Washington Post 2015 Annual Report Download - page 116

12. REDEEMABLE PREFERRED STOCK
On October 1, 2015, the Company redeemed its Series A preferred stock with a par value of $1.00 per share and
a liquidation preference of $1,000 per share. The 10,510 shares outstanding were redeemed at the redemption
price of $1,000 per share for $10.5 million. Prior to redemption, dividends on the Series A preferred stock were
payable four times a year at the annual rate of $80.00 per share and in preference to any dividends on the
Company’s common stock. The Series A preferred stock was not convertible into any other security of the
Company, and the holders thereof had no voting rights except with respect to any proposed changes in the
preferences and special rights of such stock.
13. CAPITAL STOCK, STOCK AWARDS AND STOCK OPTIONS
Capital Stock. Each share of Class A common stock and Class B common stock participates equally in
dividends. The Class B stock has limited voting rights and as a class has the right to elect 30% of the Board of
Directors; the Class A stock has unlimited voting rights, including the right to elect a majority of the Board of
Directors. In 2015 and 2014, the Company’s Class A shareholders converted 10,822, or 1%, and 194,250, or
17%, respectively, of the Class A shares of the Company to an equal number of Class B shares. The conversions
had no impact on the voting rights of the Class A and Class B common stock.
During 2015 and 2013, the Company purchased a total of 46,226 and 33,024 shares, respectively, of its Class B
common stock at a cost of approximately $23.0 million and $17.7 million, respectively. As part of the exchange
transaction with Berkshire in 2014, the Company acquired 1,620,190 shares of its Class B common stock at a
cost of approximately $1,165.4 million. On May 14, 2015, the Board of Directors authorized the Company to
acquire up to 500,000 shares of its Class B common stock. The Company did not announce a ceiling price or
time limit for the purchases. The authorization included 159,219 shares that remained under the previous
authorization. At December 31, 2015, the Company had remaining authorization from the Board of Directors to
purchase up to 453,774 shares of Class B common stock. Shares acquired as part of the exchange transaction
received separate authorization by the Company’s Board of Directors.
Stock Awards. In 2001, the Company adopted an incentive compensation plan, which, among other
provisions, authorizes the awarding of Class B common stock to key employees. Stock awards made under this
incentive compensation plan are primarily subject to the general restriction that stock awarded to a participant
will be forfeited and revert to Company ownership if the participant’s employment terminates before the end of a
specified period of service to the Company. Some of the awards are also subject to performance conditions and
will be forfeited and revert to Company ownership if the conditions are not met. At December 31, 2015, there
were 4,625 shares reserved for issuance under this incentive compensation plan, which were all subject to awards
outstanding.
In 2012, the Company adopted a new incentive compensation plan (the 2012 Plan), which, among other
provisions, authorizes the awarding of Class B common stock to key employees in the form of stock awards,
stock options and other awards involving the actual transfer of shares. All stock awards, stock options and other
awards involving the actual transfer of shares issued subsequent to the adoption of this plan are covered under
this new incentive compensation plan. Stock awards made under the 2012 Plan are primarily subject to the
general restriction that stock awarded to a participant will be forfeited and revert to Company ownership if the
participant’s employment terminates before the end of a specified period of service to the Company. Some of the
awards are also subject to performance conditions and will be forfeited and revert to Company ownership if the
conditions are not met. As a result of the Cable ONE spin-off, the number of Class B common stock authorized
for issuance under the 2012 Plan was increased from 500,000 shares to 772,588 shares. The individual award
limit under the 2012 Plan was also increased from 50,000 shares to 77,258 shares per calendar year. At
December 31, 2015, there were 624,839 shares reserved for issuance under the 2012 incentive compensation
plan. Of this number, 181,553 shares were subject to stock awards and stock options outstanding and 443,286
shares were available for future awards.
101 GRAHAM HOLDINGS COMPANY