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SEC Filings

GRAHAM HOLDINGS CO filed this Form DEF 14A on 03/23/2017
Entire Document

    return on assets;


    earnings before interest and taxes;


    earnings before interest, taxes, depreciation and amortization;


    earnings from continuing operations, sales or revenues;


    capital or investment;


    market share;


    cost reduction goals;


    budget comparisons;


    implementation or completion of specified projects or processes;


    the formation of joint ventures, research or development collaborations, or the completion of other transactions; or


    any other measure of financial performance that can be determined pursuant to U.S. generally accepted accounting principles, or any combination of any of the foregoing.

The measurement of any performance measure may exclude the impact of charges for restructurings, discontinued operations, extraordinary items and other unusual or non-recurring items and the cumulative effects of accounting changes, each as defined by generally accepted accounting principles and as identified in the Company’s audited financial statements, including the notes thereto. These performance criteria may be used singularly or in combination to measure performance of the entire company or a business unit. The payout upon the achievement of the performance goals is equal to a percentage of the participant’s base salary, which is also set at the beginning of the year. Those percentages are determined on an individual basis, taking into account the responsibilities, prior experience and recent performance of the relevant employee.

Individual Award Limitations. The maximum incentive payment any executive officer (within the meaning of Rule 3b-7 of the Securities Exchange Act of 1934) can earn in any year under the 2012 ICP for all cash incentive awards is $25 million and the maximum number of shares of common stock that may be covered by awards granted under the 2012 ICP in any calendar year is 77,258 shares.

Effect of Proposal

The Company’s shareholders are not being asked to approve amendments or modifications to the currently effective 2012 ICP. Approval of this Proposal 4 will not increase the number of shares available for issuance under the 2012 ICP. The sole effect of our shareholders’ approval of this Proposal 4 will be to qualify the material terms of the performance goals under the 2012 ICP as shareholder-approved performance goals for purposes of Section 162(m) of the Code.

Summary of Additional Material Terms of the 2012 ICP

Administration. The Compensation Committee will administer the 2012 ICP and may delegate to a subcommittee of one or more members of our Board of Directors or employees of the Company the ability to grant awards, subject to applicable restrictions and limitations. The applicable committee will designate from time to time those employees and Directors who will receive awards under the 2012 ICP; determine the amount, type and other terms and conditions of such incentive awards; and, subject to the terms and limitations set fourth in the 2012 ICP, establish the terms, conditions and other provisions of any awards granted under the 2012 ICP. The Compensation Committee will have complete authority to establish rules and regulations for the administration of the 2012 ICP.

Shares Authorized. The maximum number of shares of common stock that may be covered by awards granted under the 2012 ICP will not exceed 772,588 shares of common stock in the aggregate. For this purpose, as described more fully in the next paragraph, only shares actually issued and vested pursuant to the 2012 ICP, net of any shares that are received by the Company in connection with awards granted under the 2012 ICP, will count for this purpose. This share limit will be subject to adjustment as provided under the 2012 ICP. Shares of common stock issued under the 2012 ICP may be either authorized and unissued shares, or treasury shares, or both, at the sole discretion of the Compensation Committee.

Shares of common stock covered by awards under the 2012 ICP will only be counted as used to the extent they are actually issued and delivered to a participant (or such participant’s permitted transferees as described in the 2012 ICP) pursuant to the 2012 ICP. Accordingly, if an award is settled for cash or if shares of common stock are withheld to pay the exercise price of an option or to satisfy any tax withholding requirement in connection with an award, only the shares issued (if any), net of the shares withheld, will be deemed delivered for purposes of determining the number of shares of common stock that are available