Washington Post 2005 Annual Report Download - page 69

redemption price of $1,000 per share. In addition, the holders of such for 14,190 shares, in 2008 for 425 shares, and in 2009 for
stock have a right to require the Company to purchase their shares at the 15,865 shares. Stock-based compensation costs resulting from
redemption price during an annual 60-day election period; the Ñrst such stock awards reduced net income by $3.5 million ($0.36 per
period began on February 23, 2001. Dividends on the Series A share, basic and diluted), $3.6 million ($0.38 per share, basic
Preferred Stock are payable four times a year at the annual rate of and diluted), and $3.9 million ($0.41 per share, basic and
$80.00 per share and in preference to any dividends on the Company's diluted) in 2005, 2004, and 2003, respectively.
common stock. The Series A Preferred Stock is not convertible into any Stock Options. The Company's employee stock option plan
other security of the Company, and the holders thereof have no voting reserves 1,900,000 shares of the Company's Class B common
rights except with respect to any proposed changes in the preferences stock for options to be granted under the plan. The purchase price
and special rights of such stock. of the shares covered by an option cannot be less than the fair
value on the granting date. At January 1, 2006, there were
G. CAPITAL STOCK, STOCK AWARDS AND STOCK 408,325 shares reserved for issuance under the stock option plan,
OPTIONS
of which 113,325 shares were subject to options outstanding, and
Capital Stock. Each share of Class A common stock and Class B 295,000 shares were available for future grants.
common stock participates equally in dividends. The Class B stock
Changes in options outstanding for the years ended January 1,
has limited voting rights and as a class has the right to elect 30% of
2006, January 2, 2005, and December 28, 2003, were as
the Board of Directors; the Class A stock has unlimited voting rights,
follows:
including the right to elect a majority of the Board of Directors.
During 2005 and 2004, the Company did not purchase any shares 2005 2004 2003
Number Average Number Average Number Average
of its Class B common stock. During 2003, the Company purchased of Option of Option of Option
a total of 910 shares of its Class B common stock at a cost of Shares Price Shares Price Shares Price
approximately $0.7 million. At January 1, 2006, the Company has
Beginning of yearÏÏÏÏÏ 122,250 $561.05 152,475 $530.81 163,900 $515.74
authorization from the Board of Directors to purchase up to Granted ÏÏÏÏÏÏÏÏÏÏ 4,500 762.50 4,000 953.50 5,000 803.70
542,800 shares of Class B common stock. Exercised ÏÏÏÏÏÏÏÏÏ (12,800) 533.24 (33,225) 467.68 (15,675) 450.87
Forfeited ÏÏÏÏÏÏÏÏÏÏ (625) 530.87 (1,000) 621.38 (750) 729.00
Stock Awards. In 1982, the Company adopted a long-term End of year ÏÏÏÏÏÏÏÏÏ 113,325 $572.36 122,250 $561.05 152,475 $530.81
incentive compensation plan, which, among other provisions, autho-
rizes the awarding of Class B common stock to key employees. Of the shares covered by options outstanding at the end of 2005,
Stock awards made under this incentive compensation plan are 100,950 are now exercisable, 5,750 will become exercisable in
subject to the general restriction that stock awarded to a participant 2006, 3,375 will become exercisable in 2007, 2,125 will
will be forfeited and revert to Company ownership if the partici- become exercisable in 2008, and 1,125 will become exercisable
pant's employment terminates before the end of a specified period in 2009. For 2005, 2004, and 2003, the Company recorded
of service to the Company. At January 1, 2006, there were expense of $1.1 million, $0.8 million, and $0.6 million, respective-
187,505 shares reserved for issuance under the incentive compen- ly, related to this plan. Information related to stock options outstand-
sation plan. Of this number, 29,580 shares were subject to awards ing at January 1, 2006 is as follows:
outstanding, and 157,925 shares were available for future
Weighted
awards. Activity related to stock awards under the long-term
Average Weighted Weighted
incentive compensation plan for the years ended January 1, 2006, Number Remaining Average Number Average
Range of Outstanding Contractual Exercise Exercisable Exercise
January 2, 2005, and December 28, 2003, was as follows:
Exercise Prices at 1/1/2006 Life (yrs.) Price at 1/1/2006 Price
2005 2004 2003 $344 3,300 1.0 $343.94 3,300 $343.94
Number Average Number Average Number Average 472Ó484 12,125 2.7 473.70 12,125 473.70
of Award of Award of Award 500Ó596 74,900 4.8 531.42 74,900 531.42
Shares Price Shares Price Shares Price
693 500 8.0 692.51 250 692.51
729Ó763 14,000 8.0 739.77 7,125 729.00
Beginning of year ÏÏÏÏ 28,001 $644.51 29,845 $643.89 27,625 $536.74
816 4,500 8.0 816.05 2,250 816.05
AwardedÏÏÏÏÏÏÏÏÏ 16,550 940.96 200 973.88 15,990 734.01
954 4,000 9.0 953.50 1,000 953.50
VestedÏÏÏÏÏÏÏÏÏÏÏ (13,830) 609.87 (561) 625.91 (12,752) 523.60
Forfeited ÏÏÏÏÏÏÏÏÏ (1,141) 819.22 (1,483) 683.58 (1,018) 658.44 All options were granted at an exercise price equal to or greater
End of yearÏÏÏÏÏÏÏÏÏ 29,580 $819.83 28,001 $644.51 29,845 $643.89
than the fair market value of the Company's common stock at the
date of grant. The weighted average fair value for options granted
In addition to stock awards granted under the long-term incentive
during 2005, 2004, and 2003 was $218.62, $274.93, and
compensation plan, the Company also made stock awards of
$229.81, respectively. The fair value of options at date of grant
2,550 shares in 2004 and 1,050 shares in 2003.
For the share awards outstanding at January 1, 2006, the afore-
mentioned restriction will lapse in 2006 for 1,450 shares, in 2007
2005 FORM 10-K 53