SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
_______KNIGHT-RIDDER, INC.________________________
(Name of Registrant as Specified in its Charter)
_______KNIGHT-RIDDER, INC.________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: _/
4) Proposed maximum aggregate value of transaction:
_/ Set forth the amount on which the filing fee is calculated and state
how it was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
Knight-Ridder, Inc.
One Herald Plaza, Miami, Florida 33132
March 23, 1994
To Our Shareholders:
You are cordially invited to attend the Company's 1994 Annual Meeting of
Shareholders which will be held on Wednesday, May 4, 1994, at 9:30 a.m. at
the Hotel Inter-Continental, Miami, Florida. Shareholders who attended past
Annual Meetings have found them interesting and informative. We hope you
will be able to attend. Your vote is important. Whether or not you expect
to attend the Annual Meeting, please sign, date and return the enclosed Proxy.
A prompt return of your Proxy will be appreciated as it will save the expense
of further mailings. If you do attend the Annual Meeting, you may still vote
in person if you wish to.
Sincerely yours,
James K. Batten
Chairman of the Board and
Chief Executive Officer
<PAGE>
Knight-Ridder, Inc.
One Herald Plaza, Miami, Florida 33132
Notice of 1994 Annual Meeting of Shareholders
to be Held Wednesday, May 4, 1994
To the Shareholders of
KNIGHT-RIDDER, INC.
The Annual Meeting of Shareholders of Knight-Ridder, Inc. will be held at
9:30 a.m. at the Hotel Inter-Continental, 100 Chopin Plaza, Miami, Florida,
on Wednesday, May 4, 1994 for the following purposes:
1. To elect 8 directors;
and to consider and vote upon:
2. A proposal recommended by the Board of Directors that the shareholders
ratify the appointment of Ernest & Young as independent auditors of the
Company for the year 1994 (the Company Proposal);
3. A proposal by two shareholders requesting preparation of a report
relating to cigarette advertising (Shareholder Proposal No.1);
4. A proposal by a shareholder that the Company take the action necessary
to provide for the annual election of all directors (Shareholder Proposal
No. 2); and
5. A proposal by a shareholder relating to editorial policy of the
Company's newspapers on gun control and related issues (Shareholder
Proposal No. 3);
and to transact such other business as may properly come before the meeting.
The accompanying Proxy Statement contains further information with respect
to the matters to be acted upon at the meeting.
Shareholders of record at the close of business on March 15, 1994 are
entitled to notice of and to vote at the meeting.
All proxies, ballots and vote tabulations that identify the vote of a
shareholder will be kept confidential except to the extent necessary
to allow the independent inspectors to tabulate the results of the
vote or to meet applicable legal requirements.
You are invited to attend the meeting; however, if you do not expect
to attend in person, you are urged to execute and return immediately
the enclosed Proxy, which is solicited by the management. You may
revoke your Proxy and vote in person should you attend the meeting.
By Order of the Board of Directors
Douglas C. Harris
Vice President and Secretary
March 23, 1994
<PAGE>
KNIGHT-RIDDER, INC.
One Herald Plaza, Miami, Florida 33132
PROXY STATEMENT
1994 Annual Meeting of Shareholders to be Held on Wednesday, May 4, 1994
Solicitation of Proxies
This Proxy Statement is furnished in connection with the solicitation on behalf
of the Board of Directors of Knight-Ridder, Inc. (the "Company") of Proxies for
use at the Annual Meeting of Shareholders to be held at 9:30 a.m. on Wednesday,
May 4, 1994 at the Hotel Inter-Continental, Miami, Florida for the purposes
described in the accompanying Notice of Annual Meeting of Shareholders.
This Proxy Statement, the accompanying Proxy card and the Annual Report of
the Company for the year ended December 26, 1993 are being mailed together
to shareholders for the first time on March 23, 1994.
Shares represented by a valid Proxy received in time for voting will be
voted in accordance with the shareholder's instructions with respect to matters
for which a ballot is provided in the Proxy. If no such instructions are
specified, the Proxy will be voted for the election of the directors nominated
by the Board of Directors, for ratification of the appointment of Ernst & Young
as the Company's independent auditors (the Company Proposal), and against each
of the three Shareholder Proposals.
Votes by shareholders will be confidential and not disclosed to the Company
except as necessary to tabulate voting results or as required by law.
Common Stock Outstanding and Principal Holders
Each shareholder or shareholder's Proxy will be entitled to one vote for each
share held of record on March 15, 1994 on all matters which may come before
the meeting. On that date 54,748,049 shares of the Company's Common Stock
were outstanding and entitled to vote.
The following table sets forth information as of January 31, 1994 with respect
to The Northern Trust Company, the only person known by the Company to own
beneficially more than 5% of the outstanding Common Stock of the Company.
Shares
Beneficially Percent of
Name and Address of Beneficial Owner <F1> Owned Class
The Northern Trust Company 3,220,727 5.87%
Fifty South LaSalle Street
Chicago, IL 60675
[FN]
<F1> Alvah H. Chapman, Jr., a director of the Company, is a director of
Northern Trust Bank of Florida, N.A., a subsidiary of The Northern Trust
Company.
Election of Directors
The Company's Charter provides for a Board of Directors divided into three
classes having staggered three-year terms. Eight directors are to be elected
at the 1994 Annual Meeting, five to hold office until the 1997 Annual Meeting
of Shareholders, two to hold office until the 1995 Annual Meeting of
Shareholders, and one to hold office until the 1996 Annual Meeting of
Shareholders.
The individuals nominated by the Board of Directors to stand for election
at the 1994 Annual Meeting for three-year terms are Alvah H. Chapman, Jr.,
Peter C. Goldmark, Jr., Barbara B. Hauptfuhrer, William S. Lee and John L.
Weinberg, all of whom were elected by shareholders at the 1991 Annual Meeting.
Ben R. Morris and Eric Ridder, who were elected by shareholders at the 1991
Annual Meeting of Shareholders, were nominated by the Board of Directors to
stand for election for one-year terms. Randall L. Tobias, who is not
currently a member of the Board of Directors, was nominated by the Board
to stand for election for a two-year term.
The nominations of Messrs. Morris and Ridder for one-year terms and
Mr. Tobias for a two-year term were to comply with the Bylaw requirement
that, to the extent practicable, the classes of directors be of equal size.
On September 30, 1993, Robert F. Singleton retired as Chief Financial Officer
and a director. On March 22, 1994, Bernard H. Ridder, Jr., who was elected
at the 1992 Annual Meeting for a term ending in 1995, announced his retirement
from the Board. The other eight directors who were elected at prior Annual
Meetings will continue to serve their respective terms.
Proxies will be voted for the election of the eight nominees of the Board
of Directors unless instructions are given on the Proxy to withhold authority
to vote for one or more of the nominees.
Although it is not contemplated that any nominee will decline or be unable
to serve, the shares will be voted by the proxyholders in their discretion
for another person should that occur unless the Board acts to reduce the
number of directors to be elected.
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS ENDING 1997
[Photo]ALVAH H. CHAPMAN, JR., age 72 Director since 1962
Former Chairman of the Board and
Chief Executive Officer of the Company
Mr. Chapman graduated and received an honorary degree from the Citadel, as
well as honorary degrees from four other universities. Mr. Chapman joined the
company in 1960 and held various executive positions; from 1976 until 1988 he
served as Chief Executive Officer, and from 1982 until 1989 he served as
Chairman of the Board. Mr. Chapman is a director of Northern Trust Bank of
Florida, N.A. and a trustee of the John S. and James L. Knight Foundation.
Mr. Chapman is Chairman (by appointment by President Bush and Governor Chiles)
of We Will Rebuild, a not-for-profit organization dedicated to assisting South
Florida rebuild after the damage of Hurricane Andrew. He is Chairman of the
Executive Committee of the Board and the Executive Committee and serves on
the Nominating Committee.
[Photo]PETER C. GOLDMARK, JR., age 53 Director since 1990
President of The Rockefeller Foundation
Mr. Goldmark graduated from Harvard College. He has served as President
of The Rockefeller Foundation since 1988. From 1985 to 1988, he was Senior
Vice President of Times Mirror Company, and prior to that, held posts as
Executive Director of the New York and New Jersey Port Authority, Director
of Budget for the State of New York, and Secretary of Human Services for
the Commonwealth of Massachusetts. He is a director of the Dreyfus Third
Century Fund and a member of the Council on Foreign Relations. He serves
on the Finance and Nominating Committees.
[Photo]BARBARA BARNES HAUPTFUHRER, age 65 Director since 1979
Director of Various Public Companies
Mrs. Hauptfuhrer graduated from Wellesley College. She serves as a Trustee
Emeritus of Wellesley College and a Trustee of the Eisenhower Exchange
Fellowships and is a director of The Vanguard Group of Investment Companies
and all of the mutual funds in the Group; The Great Atlantic & Pacific Tea Co.;
Massachusetts Mutual Life Insurance Company; Alco Standard Corporation; and
the Raytheon Company. She chairs the Nominating Committee and serves on the
Compensation Committee.
[Photo]WILLIAM S. LEE, age 64 Director since 1990
Chairman and President of Duke Power Co.
Mr. Lee graduated from Princeton University. He is Chairman and President
of Duke Power Co. in Charlotte, N.C., which he joined in 1955. He is a
director of J.P. Morgan & Co., Morgan Guaranty Trust Co., the Liberty
Corporation and Texas Instruments. Mr. Lee has announced that he will
retire as an officer and director of Duke Power Co. at its 1994 annual meeting.
Mr. Lee is Chairman of the Environmental Affairs Committee and serves on the
Compensation Committee.
[Photo]JOHN L. WEINBERG, age 69 Director since 1969
Senior Chairman Goldman, Sachs & Co.
Mr. Weinberg graduated from Princeton University. He received a Master of
Business Administration degree from Harvard Business School. He has served
as an investment banker with Goldman, Sachs & Co. since 1950. He was senior
partner of The Goldman Sachs Group, L.P. and its principal affiliate, Goldman
Sachs & Co. until November 30, 1990 when he retired as a general partner and
became Senior Chairman of The Goldman Sachs Group, L.P. In July, 1991, he
became Senior Chairman of Goldman, Sachs & Co. Mr. Weinberg is a director
of Champion International Corporation; Capital Holding Corporation; The
B.F. Goodrich Company; The Seagram Company Ltd.; and E.I. du Pont de Nemours
& Company, Inc. He is a Charter Trustee of Princeton University and member
of The Business Council. He is Chairman of the Compensation Committee and
serves on the Executive Committee of the Board.
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS ENDING 1995
[Photo]BEN R. MORRIS, age 71 Director since 1986
Former President of The State-Record Company
Mr. Morris graduated from North Carolina State University. Mr. Morris
joined The State-Record Company in 1970 as Executive Vice President and
served as President from 1972 through 1988. He served on the Board of
Directors of The State-Record Company from 1968 until its acquisition by
the Company in 1986. He serves on the Finance and Audit Committees.
[Photo]ERIC RIDDER, age 75 Director since 1983
Publisher Emeritus of The Journal of Commerce
Mr. Ridder graduated from Harvard University. He served as Publisher of The
Journal of Commerce from 1956 to 1984, after serving as General Manager from
1946 to 1956. He is a director of the Seattle Times Company. He serves on
the Finance and Audit Committees.
NOMINEE FOR ELECTION AS DIRECTOR FOR TERM ENDING 1996
[Photo]RANDALL L. TOBIAS, age 52
Chairman and CEO Eli Lilly & Co.
Randall L. Tobias is a graduate of Indiana University. He is Chairman of the
Board and Chief Executive Officer of Eli Lilly and Company. Prior to joining
Lilly in 1993, he served as Vice Chairman of the Board of American Telephone
and Telegraph Company ("AT&T") since 1986 and as Chairman and Chief Executive
Officer of AT&T International (an AT&T subsidiary) since 1991. He joined
AT&T in 1964. Mr. Tobias is a director of Phillips Petroleum Company. He is
a trustee of Duke University, the Colonial Williamsburg Foundation, and the
Indiana University Foundation.
CONTINUING DIRECTORS
[Photo]JAMES K. BATTEN, age 58 Director since 1981
Chairman of the Board and Term expires 1995
Chief Executive Officer of the Company
Mr. Batten graduated from Davidson College in North Carolina and received
a master's degree in public affairs from Princeton University's Woodrow
Wilson School. He joined the Company in 1957, became an officer of the
Company in 1975 and has served in various executive positions. He became
Chief Executive Officer in 1988 and Chairman of the Board in 1989. Mr. Batten
is a trustee of the John S. and James L. Knight Foundation. He serves on
the Executive Committee of the Board and the Executive and Nominating
Committees.
[Photo]JOAN RIDDER CHALLINOR, age 66 Director since 1989
Director of Various Educational Term expires 1996
Organizations
Dr. Challinor attended Wells College and received her Ph.D. in History from
The American University, Washington, D.C. She is a Research Associate at
the National Museum of American History of the Smithsonian Institution and
a board member of a number of educational organizations, including the
French-American Foundation; the Schlesinger Library on the History of Women
at Radcliffe College (chairperson); and the James Madison Memorial Fellowship
Foundation (a Presidential appointment); and is a member of the Editorial
Advisory Committee of the Adams Papers. She serves on the Audit, Environmental
Affairs and Employee Stock Purchase Plan Committees.
[Photo]JESSE HILL, JR., age 67 Director since 1980
Chairman and Chief Executive Officer Term expires 1996
of Atlanta Life Insurance Co.
A native of St. Louis, Mr. Hill graduated from Lincoln University of Missouri
and received a Master of Business Administration degree from the University
of Michigan. Mr. Hill has been with Atlanta Life Insurance Co. since 1949.
He became President and Chief Executive Officer in 1973. He is Chairman of
the Board of the Martin Luther King Center for Nonviolent Social Change.
He serves on the boards of Delta Air Lines, Inc.; Trust Company of Georgia;
and National Service Industries, Inc. He is Chairman of the Audit Committee
and serves on the Finance Committee.
[Photo]C. PETER McCOLOUGH, AGE 71 Director since 1982
Former Chairman and Chief Executive Term expires 1995
Officer of Xerox Corporation
A native of Halifax, Nova Scotia, Mr. McColough, following a career in sales,
served as President of Xerox from 1966 through 1971, and as Chief Executive
Officer from 1968 through May 1982. He serves as a director of Union Carbide
Corporation. He serves on the Compensation, Nominating and Environmental
Affairs Committees.
[Photo]THOMAS L. PHILLIPS, age 69 Director since 1983
Retired Chairman and Chief Executive Term expires 1996
Officer of the Raytheon Company
Mr. Phillips graduated and received a master's degree from Virginia Polytechnic
Institute. He has honorary degrees from eight universities. He joined
Raytheon in 1948 and served as Chief Executive Officer from 1968 to March 1991
and Chairman of the Board from 1975 to March 1991, when he retired. He is a
director of Digital Equipment Corporation and Raytheon Company and is a trustee
of State Street Research funds and Massachusetts General Hospital. He is
Chairman of the Finance Committee and serves on the Compensation Committee.
[Photo]P. ANTHONY RIDDER, age 53 Director since 1987
President of the Company and the Term expires 1996
Newspaper Division of the Company
Mr. Ridder graduated from the University of Michigan. He spent the early
part of his newspaper career in various editorial and business capacities
at several of the Company's newspapers and joined the San Jose Mercury News
in 1964. He served as its general manager until 1977 when he was named
Publisher. In 1986, Mr. Ridder became President of the Newspaper Division
of the Company and in 1989, he became President of the Company. He is a
director of the Seattle Times Company. He is Chairman of the Operating
Committee and serves on the Executive and Environmental Affairs Committees.
[Photo]BARBARA KNIGHT TOOMEY, age 56 Director since 1989
Director of Various Civic and Term expires 1995
Philanthropic Organizations
Mrs. Toomey graduated from Boston University and received an A.A.S. degree
from Briarcliff College. She has worked for firms engaged in the fields
of management consulting, data retrieval and storage, resort management
and library science. Mrs. Toomey has also served on the boards of a number
of civic and philanthropic organizations. She serves on the Audit,
Environmental Affairs and Employee Stock Purchase Plan Committees.
[Photo]GONZALO F. VALDES-FAULI, age 47 Director since 1992
Regional Chief Executive Term expires 1995
Barclays Bank PLC
Mr. Valdes-Fauli was born in Havana, Cuba in 1946. He graduated from Spring
Hill College in Mobile, Alabama and received his master's degree from
Thunderbird Graduate School for International Management. He has spent
his professional life in banking, specializing in international matters.
He joined Barclays Bank in 1980. He is a trustee of the University of Miami.
Mr. Valdes-Fauli serves on the Audit and Finance Committees.
Security Ownership of Management
The following table provides information with respect to the shares of
the Company's Common Stock beneficially owned as of January 31, 1994 by
each nominee for director and each continuing director, by each other member
of management named in the table on page 11 and by all directors and officers
as a group. None of such persons beneficially owned more than 1% of the
Company's Common Stock except for Mrs. Barbara Knight Toomey and Mr. Eric
Ridder, who beneficially owned 2.98% and 2.0%, respectively. All directors
and officers of the Company as a group beneficially owned 14.42% of the
Company's Common Stock.
Total Number
of Shares
of Common Stock
Beneficially
Shares Other Than Shares Subject Owned
Name Option Shares to Options <F1> <F1><F2>
James K. Batten 33,679 328,300 361,979 <F3>
Joan Ridder Challinor 60,541 60,541 <F4>
Alvah H. Chapman, Jr. 139,612 139,612 <F3>
John C. Fontaine 3,814 44,000 47,814 <F3>
Peter C. Goldmark, Jr. 100 100
Barbara B. Hauptfuhrer 1,200 1,200 <F5>
Jesse Hill, Jr. 800 800
Ross Jones 1,000 20,000 21,000
William S. Lee 700 700
C. Peter McColough 400 400
Ben R. Morris 127,346 127,346 <F3>
Thomas L. Phillips 1,200 1,200
David K. Ray 3,400 80,350 83,750
Bernard H. Ridder, Jr. 474,392 474,392 <F3>
Eric Ridder 1,110,534 1,110,534 <F6>
P. Anthony Ridder 65,239 203,500 268,739 <F3>
Randall L. Tobias 1,000 1,000
Barbara Knight Toomey 1,670,888 1,670,888 <F3><F7>
Gonzalo F. Valdes-Fauli 500 500
John L. Weinberg 14,000 14,000
All directors and officers
as a group (33) 7,048,823 1,012,425 8,061,248 <F8>
[FN]
<F1> For purposes of computing the amounts and percentages shown, the
number of shares of Common Stock outstanding includes any shares which may
be acquired by a named person or group upon the exercise of stock options
which may be exercised within sixty days after January 31, 1994.
<F2> Except as otherwise indicated, the beneficial owner has sole voting
and investment power.
<F3> Includes shares owned by, or jointly held with, spouses as follows:
Mr. Batten -- 1,311 shares owned jointly with Mrs. Batten, and 10,000 shares
owned by Mrs. Batten as trustee; Mr. Chapman -- 7,682 shares owned jointly
with Mrs. Chapman; Mr. Fontaine -- 1,957 shares owned jointly with Mrs.
Fontaine; Mr. Morris -- 2,100 shares owned by Mrs. Morris; Mr. Bernard H.
Ridder, Jr. -- 560 shares owned by Mrs. Ridder; Mr. P. Anthony Ridder -- 1,230
shares owned by Mrs. Ridder; and Mrs. Toomey -- 600 shares owned by Mr.
Toomey. Mrs. Toomey and Messrs. Morris, Bernard H. Ridder, Jr. and P.
Anthony Ridder disclaim beneficial ownership of the shares owned by their
respective spouses. Messrs. Batten, Chapman and Fontaine share voting and
investment power with their respective spouses as to those shares owned
jointly.
<F4> Does not include 124,800 shares owned by a trust in which Mrs.
Challinor has an income interest; she has neither the power to vote these
shares nor the power to direct their disposition and she disclaims
beneficial ownership of them.
<F5> Does not include shares owned by The Vanguard Group of Investment
Companies or the mutual funds of the Group, of which Mrs. Hauptfuhrer is a
director. Mrs. Hauptfuhrer disclaims beneficial ownership of such shares.
<F6> Includes 353,804 shares held by Mr. Eric Ridder as a trustee as to
which he shares voting power. Mr. Ridder disclaims beneficial ownership of
171,708 of such shares.
<F7> Includes 1,451,007 shares owned by the James L. Knight Trust. Mrs.
Toomey is a Trust Advisor to the Trustee of the Trust. Also includes
209,625 shares held by a charitable lead trust as to which Mrs. Toomey is
the Trust Advisor to the Trustee. Upon expiration of the trust in 2016, a
portion of the residual interest in the trust will be distributed to Mrs.
Toomey's then surviving children. Mrs. Toomey disclaims beneficial
ownership of the shares owned by the charitable lead trust.
<F8> Includes 2,703,818 shares held by the John S. and James L. Knight
Foundation as to which Messrs. Batten and Chapman share voting and
investment power and disclaim beneficial ownership. Also includes 600,000
shares held by the Company's Retirement Plan as to which voting and
dispositive power is exercised by the Investment Committee under the Plan
which includes certain officers of the Company. Each member of the
Committee disclaims beneficial ownership of the 600,000 shares.
Board Committees
The Board of Directors conducts its business through meetings of the Board
and the activities of its Committees. The active standing Committees of
the Board are the Nominating Committee, the Compensation Committee, the
Audit Committee, the Finance Committee and the Environmental Affairs
Committee.
The Nominating Committee reviews the composition of the Board and
recommends changes in its membership as and if needed. During 1993, the
Committee was comprised of Barbara B. Hauptfuhrer, Chairperson, Alvah H.
Chapman, Jr., Peter C. Goldmark, Jr., C. Peter McColough, Bernard H.
Ridder, Jr. and James K. Batten, who left the Committee early in 1993. The
Committee met twice in 1993.
The Committee considers nominees for the Board of Directors recommended by
shareholders. A shareholder wishing to submit a recommendation for the
Board should mail his or her recommendation to the Committee at the
Company's Executive Offices, One Herald Plaza, Miami, Florida 33132. A
shareholder wishing to nominate a person for election to the Board at an
Annual Meeting must notify the Secretary at least 120 days prior to the
first anniversary of the Company's Proxy Statement relating to the
immediately preceding Annual Meeting.
The Compensation Committee approves salary levels of all corporate officers
of the Company and incentive compensation for certain senior officers of
the Company. It also authorizes grants under the Company's Employee Stock
Option Plan. During 1993, the Committee was comprised of John L. Weinberg,
Chairman, Barbara B. Hauptfuhrer, William S. Lee, C. Peter McColough and
Thomas L. Phillips, all of whom are outside directors. The Committee met
seven times in 1993.
The Audit Committee which in 1993 was comprised of Jesse Hill, Jr.,
Chairman, Joan Ridder Challinor, Ben R. Morris, Barbara Knight Toomey, Eric
Ridder and Gonzalo Valdes-Fauli, reviews the activities of the internal
audit staff, the independent auditors' report and the qualifications,
performance and independence of the independent auditors, and makes
recommendations to the Board respecting these matters. Both the internal
and the independent auditors have free access to the Committee and, from
time to time, the Committee directs them to carry out special assignments.
The Committee met twice in 1993. The Finance Committee periodically reviews
the Company's financial position and capital structure and makes
recommendations to the Board concerning financings.
The Finance Committee, which met once in 1993, was comprised of Robert F.
Singleton, Chairman, Peter C. Goldmark, Jesse Hill, Jr., Ben R. Morris,
Thomas L. Phillips, Eric Ridder and Gonzalo Valdes-Fauli. Mr. Phillips
succeeded Mr. Singleton as Chairman of the Committee following Mr.
Singleton's retirement on September 30, 1993.
The Environmental Affairs Committee oversees the policies of the Company
formulated to carry out the Company's commitment to preserving the natural
environment of the communities it serves and the safety of its workplaces.
The Committee consists of William S. Lee, Chairman, Joan Ridder Challinor,
C. Peter McColough, P. Anthony Ridder and Barbara Knight Toomey. The
Committee met twice in 1993.
In 1993, the Board of Directors met six times. Each of the nominees for
election at the Annual Meeting (other than Mr. Tobias who is not a member
of the Board and Mr. Lee) and each of the continuing directors attended at
least 75% of the aggregate of the total number of meetings of the Board and
of the Committees of the Board on which he or she served. Mr. Lee attended
73% of the total number of meetings that he was entitled to attend.
Compensation Committee Interlocks and Insider Participation
Messrs. Weinberg, Lee, McColough and Phillips and Mrs. Hauptfuhrer served
as members of the Company's Compensation Committee during 1993. None of
them was or is an officer or employee of the Company or any of its
subsidiaries. None of the Company's executive officers served on the
compensation committee or board of a company of which a member of the
Company's Compensation Committee or other director of the Company was an
executive officer or an executive officer of that company was one of the
Company's directors.
Mrs. Hauptfuhrer is a director of the Vanguard Group which renders services
in connection with the Company's investment savings plan. Mr. Weinberg is
a former senior partner of Goldman, Sachs & Co., a firm which performs
certain services for the Company. See page 15.
Executive Compensation
Summary
One of the most important responsibilities of the Board of Directors is to
determine the compensation of senior management. At Knight-Ridder, this
task is delegated to the Compensation Committee which is composed entirely
of outside directors.
This section of the Proxy Statement discusses the compensation awarded by
the Committee for 1993 services to the Company's Chairman of the Board and
Chief Executive Officer, Mr. Batten, the other four most highly paid senior
executive officers -- Mr. Ridder, President of the Company and President of
the Newspaper Division; Mr. Fontaine, Executive Vice President; Mr. Jones,
Senior Vice President/Finance and Chief Financial Officer and Mr. Ray,
President of the Business Information Services Division and a Vice
President of the Company -- and Mr. Singleton, who retired on September 30,
1993 as Senior Vice President/Finance and Chief Financial Officer. The
discussion includes a report of the Compensation Committee regarding the
Company's compensation policies and explaining the standards applied in
determining Mr. Batten's 1993 compensation.
The Compensation Committee report is followed by tables which summarize the
compensation of members of senior management for the past three years,
stock options granted to and exercised by senior management in 1993 and the
estimated pension benefits that senior management will receive upon
retirement. The section concludes with a graph which compares the total
return on the Company's stock over the past five years with the total
return on stocks of other publicly-held newspaper companies (including the
Company) and on the stocks of the companies which make up the S&P 500 Stock
Index.
Compensation Committee Report
The following is a report of the Compensation Committee to the
Knight-Ridder shareholders:
Compensation Policies. The Committee operates on the principle that the
compensation opportunities of Knight-Ridder's executive officers, including
its chief executive officer and the other executive officers named in the
table on page 11, should be competitive with compensation of senior
executives at comparable companies. The Committee has a policy of basing a
significant portion of the cash compensation of senior executive officers
on the operating performance of the Company. In addition, the Committee
administers the Company's Stock Option Plan, under which compensation is
directly dependent on the performance of the Company's stock.
Salary and bonus make up the current compensation of senior executives.
Stock options comprise the long-term compensation program. The Company has
no other compensation programs for senior executives.
During 1993, the Committee reviewed the Company's executive compensation
program with the assistance of Strategic Compensation Associates,
specialists in executive compensation. Among other things, the Committee
reviewed data comparing the compensation of executives of the Company with
that of the other companies included in the performance graph on page 14,
as well as with a broader range of newspaper and media companies. Data for
1988 - 1992, the period covered by the inquiry, showed that over those five
years, salary levels and stock option compensation of Company executives
were comparable to the median compensation paid by both groups of
comparative companies, but that over the same period the cash bonuses of
Company executives were substantially lower than the median paid by the
comparative companies even though the Company's financial performance
equaled or exceeded the median financial performance. As a result of the
study, the Committee recommended to the Board of Directors, and the Board
adopted, certain changes in the incentive compensation plan, none of which
affected the bonuses awarded for 1993.
Under the Company's incentive compensation plan as it applied to 1993,
participants are eligible for cash bonuses which are related to
year-to-year growth in operating profit and operating profit compared to
budget. Messrs. Jones and Ray are participants in the plan. Although
Messrs. Batten, Ridder and Fontaine are not participants in the plan, the
Committee considers the criteria and standards under the plan in
determining their bonuses.
In 1993, cash bonuses for Messrs. Batten, Ridder, Fontaine, Jones and
Singleton were based upon year-to-year growth in the Company's operating
profit and upon the Company's operating profit in comparison to the
Company's operating budget and also reflected an assessment of individual
performance during the year. The Company's performance against its
operating budget accounted for 75% of the basis for measuring potential
bonuses and performance against the prior year accounted for 25%.
Depending on their individual performance, these officers were entitled to
bonuses of up to 50% of their salaries if the Company achieved its 1993
operating budget and 110% of its 1992 operating profit.
Mr. Ray is President of the Company's Business Information Services
Division and his bonus was dependent 25% on the operating profit of the
Company compared to the prior year and to budget and 75% on the operating
profit performance of BIS compared to the prior year and budget.
These financial performance criteria determine the amount of potential
bonuses. The actual bonuses awarded are determined by multiplying the
potential bonus amount by the percentage of an executive's individual
performance goals that were achieved during the year. In the case of
participants in the plan (Messrs. Jones and Ray), specific individual
performance goals were set at the beginning of the year and performance
against the goals measured at the end of the year. The individual overall
performance of Messrs. Batten, Ridder, Fontaine and Singleton was judged by
the Committee on a subjective basis.
1993 Compensation of the Chief Executive Officer. On April 1, 1993, Mr.
Batten's salary was increased to $630,000 from $600,000, which it had been
for the prior three and one-half years. Mr. Batten was awarded a bonus for
1993 of $170,000. In 1992 he had been eligible under the Committee's
guidelines for a bonus of $168,000 but, at his request, he was awarded a
bonus of half that amount and the balance that could have been awarded to
him was included in the Company's $250,000 contribution to the Miami Herald
Lend-A-Hand Fund for aid to employees severely affected by Hurricane
Andrew.
As we noted above, Mr. Batten is not a formal participant in the Company's
incentive compensation plan although the Committee has for a number of
years, including 1993, utilized the criteria that would have been
applicable to him had he been a plan participant. Based upon the Company's
financial performance in 1993 compared to its operating budget and to its
operating profit in 1992, the maximum bonus Mr. Batten could have received
for 1993 under the plan criteria (depending on our assessment of his
individual performance) was $189,000. This compares to a potential bonus
of up to $311,000 that he could have received under the plan criteria had
the Company met its 1993 operating profit budget and achieved 110% of its
1992 operating profit.
The Committee granted Mr. Batten a 1993 stock option covering 30,000
shares, the same as was granted to him in 1992 and 1991. As we noted
above, the comparative data we received indicated that a grant of this size
was comparable to the median long-term compensation in comparable
companies.
In assessing Mr. Batten's total compensation, we took into consideration
other aspects of the Company's financial performance, including the
strength of its balance sheet and its net cash flow and Mr. Batten's
leadership in keeping the Company financially sound in difficult economic
times and in developing strategies designed to adapt the Company's
businesses to changing competitive, technological and economic conditions.
Based upon these criteria, compensation at comparable companies as
summarized in data provided to us by Strategic Compensation Associates
referred to earlier in this report and his compensation history, we believe
that we would have been justified in paying Mr. Batten significantly more
for his 1993 services. However, we do concur with his belief that
restraint in top executive compensation is appropriate, especially in times
of economic stress.
Other Officers. The compensation of Mr. Ridder, Mr. Jones, Mr. Ray, and
Mr. Fontaine was determined in accordance with the policies discussed
earlier in this report. As in the case of Mr. Batten, the amounts of their
bonuses were directly related to operating profit performance compared to
last year and to the 1993 operating budget and also reflected assessments
of their individual performances. Mr. Singleton retired on September 30,
1993. His 1993 bonus was awarded pursuant to the terms of his retirement
agreement with the Company (page 11) and was based on a determination of
three-quarters of the bonus that he would have received had he been
employed for the full year.
All members of the Committee concur and join in this report to the
Knight-Ridder shareholders.
John L. Weinberg, Chairman
Barbara Barnes Hauptfuhrer
William S. Lee
C. Peter McColough
Thomas L. Phillips
<PAGE>
Senior Executive Compensation
The following table summarizes the compensation during the past three years
of the chief executive officer, Mr. Batten, each of the other four most
highly compensated senior executive officers in 1993, and the former chief
financial officer.
SUMMARY COMPENSATION TABLE
Annual Compensation
Other
Annual
Salary Bonus Compensation
Name and Principal Position <F1> Year ($) ($)<F2> ($)<F3><F4>
James K. Batten 1993 622,500 170,000 --
Chairman and CEO 1992 600,000 84,000 --
1991 600,000 0 --
P. Anthony Ridder 1993 490,750 134,000 --
President 1992 466,500 66,080 --
1991 450,000 0 --
John C. Fontaine 1993 390,000 105,000 --
Executive Vice President 1992 370,000 108,000 --
1991 356,500 --
Ross Jones 1993 297,051 159,872 126,383
Senior Vice President/ 1992 -- -- --
Finance and CFO 1991 -- -- --
David K. Ray 1993 333,000 133,114 --
President of Business 1992 320,000 70,840 110,000
Information Services Division 1991 306,000 76,225 --
Robert F. Singleton 1993 340,207 54,863 --
Senior Vice President/ 1992 371,250 108,000 --
Finance and CFO 1991 356,708 0 --
Long-Term
Compensation
Stock All
Option Other
Awards Compensation
Name and Principal Position <F1> Year (# of shares) ($)<F3><F5>
James K. Batten 1993 30,000 13,239
Chairman and CEO 1992 30,000 12,764
1991 30,000 12,523
P. Anthony Ridder 1993 25,000 8,449
President 1992 25,000 8,107
1991 25,000 7,838
John C. Fontaine 1993 18,000 12,497
Executive Vice President 1992 16,000 11,917
1991 15,000 11,388
Ross Jones 1993 20,000 2,350
Senior Vice President/ 1992 -- --
Finance and CFO 1991 -- --
David K. Ray 1993 12,000 7,543
President of Business 1992 12,000 7,281
Information Services Division 1991 6,000 6,955
Robert F. Singleton 1993 -- 102,208
Senior Vice President/ 1992 16,000 12,073
Finance and CFO 1991 16,000 11,622
[FN]
<F1> Mr. Jones became an officer of the Company on February 23, 1993 and
succeeded Mr. Singleton as Senior Vice President/Finance and Chief
Financial Officer upon Mr. Singleton's retirement on September 30, 1993.
Mr. Singleton agreed to serve the Company as a consultant for one year
following his retirement at an annual fee of $50,000. His consulting
agreement also provides that Mr. Singleton is entitled to an annual
retirement benefit, including the benefit payable to him under the
Company's regular retirement program, of $200,000.
<F2> The Committee reduced by approximately half the bonuses it otherwise
would have paid to Mr. Batten and Mr. Ridder for 1992 services and the
Company included the amounts that would have been paid to them in the
$250,000 which the Company contributed to the Lend-A-Hand Fund for
hurricane relief for employees. The bonus shown for Mr. Jones includes
$75,000 paid to Mr. Jones when he joined the Company. Mr. Fontaine was not
eligible for a bonus for his 1991 services.
<F3> The Company does not have a restricted stock plan or any long-term
incentive plan other than its Stock Option Plan. Except as disclosed in
tables in this proxy statement, none of the named officers received a
perquisite or benefit in 1993 in an amount exceeding established reporting
thresholds.
<F4> The amount shown for Mr. Ray for 1992 is a payment in connection with
his relocation from Kansas City to Miami. The amount shown for Mr. Jones
relates to expenses incurred by the Company in connection with his move to
Miami when he joined the Company.
<F5> In the case of each executive other than Mr. Singleton, the amounts
shown represent Company contributions to the Company's Investment Savings
(401(k)) Plan and the cost of insurance on the life of the executive named.
In the case of Mr. Singleton, the amounts represent Company contributions
to the 401(k) plan and the cost of life insurance and for 1993 a retirement
gift valued at $5,000 and a post-retirement payment of $86,806 in lieu of
certain post-retirement health benefits. The 401(k) contributions in 1993
and 1992 were as follows: Mr. Batten -- $5,285 and $5,114; Mr. Ridder --
$4,497 and $4,364; Mr. Fontaine -- $4,985 and $4,827; Mr. Ray -- $4,914 and
$4,764; and Mr. Singleton -- $4,755 and $4,833. The life insurance amounts
in 1993 and 1992 were as follows: Mr. Batten -- $7,954 and $7,650; Mr.
Ridder -- $3,952 and $3,743; Mr. Fontaine -- $7,512 and $7,090; Mr. Jones -
- - $2,350; Mr. Ray -- $2,629 and $2,517; and Mr. Singleton -- $5,647 and
$7,240.
Stock Options Granted
The Company's long-term incentive program consists of its Employee Stock
Option Plan pursuant to which the Compensation Committee may grant key
executives options which give the executive the right at any time in the
succeeding ten years to purchase shares of the Company's stock at the
market price at the option grant date. The options granted in 1993 are, as
are options granted in prior years, immediately exercisable. In 1993, the
Committee determined that options granted in the future will provide that
the option will become exercisable in three equal installments vesting over
a three-year period from the date of grant.
Options permit executives who contribute to the performance of the Company
and the market price of its stock to benefit along with the shareholders in
increases in the value of the stock.
The following table sets forth information regarding stock options granted
in 1993 to each of the executive officers named earlier in the Summary
Compensation Table.
STOCK OPTION GRANTS IN LAST FISCAL YEAR
Number of % of Total
Securities Options
Underlying Granted to Exercise
Options Employees in Price Expiration
Name Granted Fiscal Year ($/share) Date
James K. Batten 30,000 4.1% 58.9375 14-Dec-2003
P. Anthony Ridder 25,000 3.4% 58.9375 14-Dec-2003
John C. Fontaine 18,000 2.4% 58.9375 14-Dec-2003
Ross Jones 12,000 1.6% 58.9375 14-Dec-2003
8,000 1.1% 60.3750 22-Feb-2003
David K. Ray 12,000 1.6% 58.9375 14-Dec-2003
Grant Date
Present Value
Name ($)
James K. Batten 505,200
P. Anthony Ridder 421,000
John C. Fontaine 303,120
Ross Jones 202,080
134,720
David K. Ray 202,080
The "grant date present value" shown is a hypothetical value based upon
application of the "Black-Scholes" model which often is used to estimate
the market value of transferable options by calculating the probability,
based on the volatility of the stock subject to the options, that the stock
price will exceed the option exercise price at the end of the option term.
The assumptions used in calculating the Black-Scholes value of the options
were expected volatility of 0.18, risk-free return of 5.92% and a dividend
yield of 2.4%.
The Company's stock options are not transferable and, the Black-Scholes
estimate notwithstanding, an option granted under the Stock Option Plan
will have value to the optionee only if and to the extent the market price
of the Company's stock rises above the market price on the date the option
was granted.
Stock Options Exercised
The following table summarizes information regarding stock options
exercised in 1993 by each of the officers named in the table on page 11 and
the number of unexercised options held by them at the end of the year.
AGGREGATE STOCK OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END STOCK OPTION VALUES
Number of
Securities
Underlying
Unexercised
Shares Options at
Acquired on Value Fiscal
Exercise Realized Year-end
Name (#) ($) (#)
James K. Batten 20,000 699,811 342,500
P. Anthony Ridder -- -- 203,500
John C. Fontaine 16,616 281,488 44,000
Ross Jones -- -- 20,000
David K. Ray 15,000 480,313 80,350
Robert F. Singleton 26,403 536,067 76,861
Value of
Unexercised
In-the-
Money
Options at
Fiscal
Year-end
Name ($)<F1>
James K. Batten 4,458,203
P. Anthony Ridder 2,251,779
John C. Fontaine 87,875
Ross Jones 10,500
David K. Ray 903,539
Robert F. Singleton 762,463
[FN]
<F1> The amount shown is the amount by which the market value at year-end
of all shares subject to unexercised options exceeded the exercise price of
those options.
Pension Benefits
The following table sets forth the annual benefits payable as a
straight-life annuity under the Company's retirement program to an officer
retiring in 1993 at age 65 with a specified combination of final average
earnings (salary and bonus) and years of service with the Company. The
benefits shown are not subject to any deduction for social security.
PENSION PLAN TABLE
Years of Service
Remuneration 15 20 25 30 35
$125,000 $ 35,910 $ 41,631 $ 47,351 $ 53,071 $ 56,196
200,000 58,410 67,881 77,351 86,821 91,821
300,000 88,410 102,881 117,351 131,821 139,321
400,000 118,410 137,881 157,351 176,821 186,821
450,000 133,410 155,381 177,351 199,321 210,571
500,000 148,410 172,881 197,351 221,821 234,321
550,000 163,410 190,381 217,351 244,321 258,071
600,000 178,410 207,881 237,351 266,821 281,821
700,000 208,410 242,881 277,351 311,821 329,321
800,000 238,410 277,881 317,351 356,821 376,821
900,000 268,410 312,881 357,351 401,821 424,321
Years of Service
Remuneration 40
$125,000 $ 59,321
200,000 96,821
300,000 146,821
400,000 196,821
450,000 221,821
500,000 246,821
550,000 271,821
600,000 296,821
700,000 346,821
800,000 396,821
900,000 446,821
The salary and bonus of the senior officers of the Company is set forth in
the summary compensation table at page 11. As of the end of 1993, Mr.
Batten had 31 years of services with the Company, Mr. Ridder 32, Mr. Ray
14, and Mr. Fontaine 6. Mr. Fontaine has a retirement agreement which
provides for the payment to him of an annual benefit of up to $200,000
annually upon retirement or earlier termination due to disability and a
death benefit payable to his surviving spouse. Mr. Singleton, who retired
on September 30, 1993, is entitled under his retirement agreement with the
Company (see page 11) to receive a lifetime annual retirement benefit of
$200,000.
Performance of the Company's Stock
The following graph compares the cumulative total return on the Company's
stock during the past five years with the average cumulative total return
during the same period on the stocks which comprise the S&P 500 Stock Index
and the S&P Publishing/Newspapers Index.
The S&P 500 Stock Index is comprised of 500 U.S. companies in the
industrial, transportation, utilities and financial industries, weighted by
market capitalization. The S&P Publishing/Newspapers Index is comprised of
Dow Jones & Company, Inc., Gannett Co., Inc., Knight-Ridder, Inc., The New
York Times Company, The Times Mirror Company and Tribune Company, weighted
by market capitalization.
The graph reflects the investment of $100 on December 31, 1988 in the
Company's Common Stock, the S&P 500 Stock Index and the S&P
Publishing/Newspapers Index. Dividends are assumed to have been reinvested
as paid in the Company's Common Stock and in the stocks in the S&P 500
Stock Index and quarterly in the stocks in the S&P Publishing/Newspapers
Index. [Performance Graph filed under cover Form SE]
Compensation of Directors
Directors of the Company who are not employees of the Company receive an
annual retainer of $26,000 plus $1,000 for each Board meeting and $800 for
each Committee meeting attended as compensation for their services.
Directors of the Company are eligible to enter into individual agreements
to defer with interest all or a portion of the directors' fees payable to
them until such later dates as may be provided in the agreements.
Directors who have never been employed by the Company are eligible to
receive a retirement benefit commencing upon retirement from the Board at
or after age 65 with at least five years of service or because of
disability following at least two years of service. The annual lifetime
benefit ranges from 50% of the annual retainer in the case of directors who
retire after five years of service on the Board to 100% of the retainer in
the case of directors who retire with 10 or more years of service.
Mr. Alvah H. Chapman, Jr., a former chief executive officer of the Company,
has agreed to continue to serve as Chairman of the Executive Committee and
to provide consulting services to the Company during the 12-month period
beginning October 1, 1993. The Company has agreed to pay Mr. Chapman
$150,000 for these services. Mr. Chapman's agreement with the Company also
provides, in recognition of his contribution to the Company and his
continued services to it, for payment of a $79,900 annual benefit to him
for his life and thereafter to Mrs. Chapman if she survives him for her
life, in addition to benefits payable under the Knight-Ridder retirement
program.
Certain Transactions, Relationships and Reports of Certain Stock
Transactions
John L. Weinberg is a former senior partner and now Senior Chairman of
Goldman, Sachs & Co. investment bankers. Goldman, Sachs & Co. has acted as
financial advisor to the Company and has performed services in connection
with the purchase and sale by the Company of commercial paper, the
underwriting and sale and purchase of securities of the Company and the
acquisition or sale of certain properties of the Company. The Company may
call upon this firm to provide similar services in the future.
Barbara B. Hauptfuhrer is a director of The Vanguard Group of Investment
Companies. The Vanguard Group of Investment Companies provides continuing
services in connection with administering and investing funds in the
Investment Savings (401(k)) Plan of the Company.
Joan Ridder Challinor, Bernard H. Ridder, Jr. and Eric Ridder are first
cousins, and P. Anthony Ridder is a son of Bernard H. Ridder, Jr. Peter B.
Ridder, President and Publisher of the Saint Paul Pioneer Press, is a son
of Bernard H. Ridder, Jr. and a brother of P. Anthony Ridder. Alvah H.
Chapman, Jr.'s son-in-law, Robert L. Hilton, is Circulation Marketing
Manager at The Wichita Eagle. Frank Page Morris, an Executive Vice
President of The State-Record Company, Inc., is a son of Ben R. Morris.
Edmund E. Olson, who is President and Publisher of The Macon Telegraph, is
Mrs. Toomey's brother-in-law. These persons related to directors of the
Company received aggregate compensation from the Company in 1993 of
$657,945.
The Securities Exchange Act of 1934 requires that the Company's directors
and officers file reports of ownership and changes in ownership with the
Securities and Exchange Commission and the New York Stock Exchange. The
Company believes that all directors and officers filed on a timely basis
all such reports required of them with respect to stock ownership and
changes in ownership during 1993, except that Mr. Valdes-Fauli
inadvertently filed late a report regarding his purchase in 1993 of 150
shares of Common Stock.
Proposals
Company Proposal -- Ratification of Appointment of Independent Auditors
Ernst & Young, Independent Certified Public Accountants, have been
appointed by the Board of Directors of the Company to examine the books and
accounts of the Company for the year 1994. They have served as the
Company's independent auditors since 1951. The Board of Directors
recommends that shareholders approve and ratify this appointment.
Representatives of Ernst & Young will be present at the meeting and will
have the opportunity to make a statement if they desire to do so. They
will be available to respond to appropriate questions.
The Board of Directors recommends that Shareholders vote FOR the Company
Proposal.
Shareholder Proposal No. 1 -- Preparation of a Report Regarding Cigarette
Advertising
Catholic HealthCare West, 1700 Montgomery Street, San Francisco, California
94111, beneficial owner of 31,000 shares of Common Stock, and Mercy Health
Services, 34605 Twelve Mile Road, Farmington Hills, Michigan 48331-3221,
owner of 1,500 shares of Common Stock, have informed the Company that they
intend to present the following resolution at the Annual Meeting and have
submitted the following statement of their reasons.
"WHEREAS -- Smoking annually causes more than one of every six deaths in
the USA; over 430,000 die from cigarette-caused diseases and 50,000 die
from effects related to passive smoking;
Given these statistics, in 1993 The Seattle Times decided to reject all
cigarette advertising, even though it meant revenue losses. The paper's
publisher cited growing medical evidence on the dangers of smoking, as well
as tobacco advertisers' recent targeting of youth and racial minorities, as
prompting the move: "The evidence that smoking is the nation's No. 1
health problem is overwhelming," Publisher Frank Blethen said. "In good
conscience, we can no longer provide a forum for promoting sales of these
products."
In 1965, the cigarette industry adopted a voluntary Code to dissuade youth
from smoking; however, it abolished enforcement mechanisms for the Code in
1967. Alleged code violations include:
Using models appearing to be under age 25, and/or who have just
participated in physical activity;
Portraying women's brands as a way to be beautiful and thin;
Promoting "low-tar and nicotine" brands as reducing health risks;
Implying smoking makes one "alive with pleasure" when its use is lethal;
The Center for Disease Control calculates every cigarette steals 7 minutes
of a smoker's life, adding up to 5 million years of potential life
Americans lose smoking annually;
RESOLVED: Shareholders request a Report to be prepared for requesting
shareholders by September 1, 1995. This Report, prepared at a reasonable
cost and free of proprietary information, will develop ethical and moral
criteria providing guidelines related to continued cigarette advertising in
our publications. In preparation of this report we believe the following
issues should be analyzed:
Whether consumers and the Board feel cigarette ads in our media:
a) Encourage children to smoke by using cartoon characters such as Joe
Camel;
b) Use models perceived to be under 25;
c) Falsely portray smoking as "cool" or stylish;
d) Use slogans such as "alive with pleasure" that are contradictory and
misleading
Policies and practices our company might follow to ensure that cigarette
ads we accept are not manipulative or misleading.
The pluses and minuses of refusing all tobacco ads.
We believe First Amendment arguments do not adequately justify cigarette
advertising. While supporting the First Amendment and arguing against
government regulation to ban advertising, Frank Blethen argued, "We are
exercising the independent judgment that is our responsibility as a
newspaper." Michael R. Francher, Times executive editor argued that "The
First Amendment restricts what Congress can do; it does not restrict the
press or require anything of the press. The press is free to act under its
own ethics. The Times concluded that, while it has the right to publish
tobacco advertising, it has the responsibility to refuse the ads." If you
agree that our Company should study the moral implications of continued
advertising of cigarettes, please vote "yes"."
The Board of Directors recommends that Shareholders vote AGAINST
Shareholder Proposal No. 1
Management's Position
During 1993, a management committee reviewed the Company's position on the
advertising of cigarettes and other tobacco products and presented its
report to the Board. The Board, after careful consideration, decided that
the Company should continue its current practice and not mandate any
corporate-wide policy to all its newspapers relating to advertising of
tobacco products. In its deliberations, the Board took note of the facts
that tobacco products are legal products, that the Company's newspapers are
sensitive to community concerns when they consider whether and how to
accept advertising for tobacco products and that the Company's newspapers
provide public service announcements, many of which promote health related
causes. To date, the Company is not aware that any major newspaper other
than The Seattle Times has banned cigarette advertising.
The Company's newspapers are aware of the need to be socially responsible
in accepting advertising products. Accordingly, the Board believes that
there would be no benefit to the Company and its shareholders from
undertaking the preparation of the report requested by the proposal.
For these reasons, the Board recommends that shareholders vote AGAINST
Shareholder Proposal No. 1.
Shareholder Proposal No. 2 -- Annual Election of Directors
Lila Roisman, 1919 Chestnut Street, Philadelphia, Pennsylvania 19103, owner
of 725 shares of Common Stock, has informed the Company that she intends to
be present at the Annual Meeting and to present the following resolution
and has submitted the following statement of her reasons.
"BE IT RESOLVED: The shareholders of Knight-Ridder, Inc., assembled in
annual meeting in person and by proxy, hereby request that the Board of
Directors take the necessary steps, in accordance with Florida State law,
to declassify the Board of Directors for the purpose of director elections.
The Board declassification shall be done in a manner that does not affect
the unexpired terms of the directors previously elected.
SUPPORTING STATEMENT: The election of corporate directors is the primary
avenue in the American corporate governance system for shareholders to
influence corporate affairs and exert accountability on management. We
strongly believe that our Company's financial performance is closely linked
to its corporate governance policies and procedures, and the level of
management accountability they impose. Therefore, as shareholders
concerned about the value of our investment, we are very disturbed by our
Company's current system of electing only one-third of the board of
directors each year. We believe this staggering of director terms prevents
shareholders from annually registering their views on the performance of
the board collectively and each director individually.
Concerns that the annual election of all directors would leave our Company
without experienced Board members are unfounded. If the owners should
choose to replace the entire board, it would be obvious that the incumbent
directors' contributions were not valued. Additionally, concerns that the
annual election for all directors would expose shareholders to takeover
attempts at below full value are also unfounded. In addition to the
classified board, the Company has the following measures which protect
incumbency and limit accountability to shareholders: a shareholders'
rights plan ("a poison pill"), no cumulative voting, golden parachutes, and
prohibitions against shareholders acting by written consent or calling
special shareholder meetings.
It is our belief that a company's corporate governance procedures and
practices, and the level of management accountability they impose, are
related to the financial performance of the company. While the company's
current performance is good, we believe that sound corporate governance
practices, such as annual election of directors, will impose the level of
management accountability necessary to help insure that a good performance
record continues over the long term. Among those Fortune 500 corporations
who have no staggered boards are General Motors, Warner-Lambert Co.,
McClatchy Newspapers, Digital Communications Association, Sierra Pacific
Resources, USF&G Corp., AMP, Atari Corp., and Texas Instruments. The fact
that our Company is currently performing well does not justify policies
that diminish accountability to the shareholders. We must not allow
ourselves to become complacent in light of the current performance of the
company."
The Board of Directors recommends that Shareholders vote AGAINST
Shareholder Proposal No. 2.
Management's Position
Shareholders voted in 1989 to amend the Company's Charter to provide for
the present method of electing directors. Under the Company's Charter, the
shareholders annually elect approximately one-third of the directors to
serve for three-year terms.
The Board of Directors believes the existing Charter provision for a board
of three classes of directors who serve for three-year terms is serving the
Company well. It promotes Board stability and continuity and protects the
Company against the demands of a minority shareholder or group.
The proposal would not amend the Company's Charter at this time, but
instead requests that the Board take the necessary steps, in accordance
with Florida State law, "to declassify the Board of Directors." Under the
provisions of the Company's Charter approved by shareholders in 1989, an
affirmative vote of 80% of the outstanding shares of Common Stock entitled
to vote on a resolution proposed by the Board to amend the Charter would be
required at a future meeting of shareholders in order to provide for the
annual election of all directors.
Your Board of Directors believes that a change in the manner in which you
elect directors is not in the best interests of all shareholders and
recommends that shareholders vote AGAINST Shareholder Proposal No. 2.
Shareholder Proposal No. 3 -- Change in Editorial Policy Regarding Gun
Control and Related Issues
Dr. Ronald P. Grunwald, S. 12810 Valley Chapel Road, Valleyford, WA 99036,
owner of 40 shares of Common Stock, has informed the Company that he
intends to be present at the Annual Meeting and to make a proposal
described in the following material he has submitted to the Company.
"RESOLVED: Knight-Ridder Shareholders for Truth (KRST) -- Neal Knox, R.P.
Grunwald, M.D., Leroy Pyle, Jr., Ronald Herman, Rick Carone, Professor
Joseph E. Olson, Russ Howard -- urges that shareholders ask the Board of
Directors to address the problems below:
KRST holds that Knight-Ridder corporate policy tolerates biased reporting
on crime, self-defense and the 2nd Amendment, and unfair stereotyping of
gun owners. News articles often appear to be thinly disguised editorials
for gun control.
Corporate policy tolerating this bias . . .
Causes prejudice against 2nd Amendment supporters.
Engenders laws that violate Constitutional rights, forcing citizens to
engage in civil disobedience and subjecting them to potential arrest,
imprisonment, even death.
Engenders laws that leave citizens defenseless against criminals.
Examples:
Luby's Cafeteria massacre, where a gunman facing no resistance shot people,
leisurely reloaded, and shot more. Twenty-four were slaughtered because
Texas law prevents decent citizens from carrying concealed firearms. Many
victims obediently left guns in their cars. Just one concealed weapon
could have stopped the slaughter.
During the L.A. Riots, government ensured that citizens were defenseless
against rioters. Ammunition sales and "assault rifles" were banned, gun
sales subject to a 15-day waiting period. Citizens were arrested for
carrying guns for self-defense. Criminals didn't wait, smashing into gun
stores and taking whatever they wanted. The riots proved that "assault
rifles" are the "weapon of choice": not of gang members, but of decent
citizens defending their lives and neighborhoods. One business's owners
paced the roof with "assault weapons" -- illegal under the ban. It was the
only business on the block that wasn't looted.
Corporate policy tolerating bias against publishing such facts violates The
Knight-Ridder Promise:
"Our Enterprise is . . . a public trust, built on the highest standards of
ethics and integrity. We are rooted in our founders' conviction that
high-quality newspapers -- fair, independent, probing, relevant,
compassionate -- are indispensable to our free society." . . . "You can
count on our honesty and fairness, our professionalism, our responsiveness,
our courtesy, our dedication to quality -- and our passion to serve you
well."
Corporate policy tolerating a one-sided propaganda is bad business
practice:
People become reluctant to subscribe -- hunters, target shooters, and gun
collectors in particular. They enjoy expensive leisure activities and have
the means to buy what advertisers want to sell.
Advertisers (e.g., gun stores) become reluctant to advertise.
Frustration may result in unconventional recourse. For example, ads were
withheld from the Des Moines Register to protest a PETA ad comparing the
livestock industry to Jeffrey Daumer's cannibalism.
Corporate policy tolerating slanted news yields lower subscription revenue,
lower ad revenue, lower profits, lower stock prices -- also violating The
Knight-Ridder Promise:
"We promise to work hard to make your investment . . . attractive. We are
committed to . . . operations with sound economic prospects . . . to
consistent growth in profits and a fair return on investment . . . ."
A time when newspapers face diminishing circulation and increasing
financial difficulties is no time to play fast and loose with
Knight-Ridder's credibility. Corporate policy should encourage the whole
truth, credibility, and questionably unbiased news."
The Board of Directors recommends that shareholders vote AGAINST
Shareholder Proposal No. 3.
Management's Position
Although not entirely clear, Dr. Grunwald's proposal seems to disagree with
the reporting and editorial policy of the Company's newspapers regarding
gun control and related issues. Your Board of Directors believes that the
Company's newspapers address the subjects referred to in the proposal in a
professional and objective manner. Local editorial independence is a
fundamental premise on which our Company is built and the Board does not --
and will not -- interfere with that editorial independence on any subject.
The action proposed would threaten the vitality and independence of the
Company's newspapers and clearly is not in the best interests of the
shareholders.
Accordingly, the Board of Directors recommends that shareholders vote
AGAINST Shareholder Proposal No. 3.
Vote Required
The presence, in person or by proxy, of a majority of the outstanding
shares of Common Stock of the Company is necessary to constitute a quorum
at the Annual Meeting. To be elected, each director must receive the
affirmative vote of the holders of a plurality of the outstanding shares of
Common Stock entitled to vote and represented at the Annual Meeting.
Approval of the Company Proposal and Shareholder Proposal Nos. 1, 2 and 3
will require the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock entitled to vote and represented at the
Annual Meeting. As explained on page 18, implementation of the action
requested by Shareholder Proposal No. 2 through amendment of the Company's
Charter to require annual election of all directors would require the
affirmative vote of 80% of the outstanding shares of Common Stock.
Shares represented at the meeting in person or by proxy which abstain on a
matter or are not voted by a broker because the proxy has not received
necessary authorization will be counted in determining the presence of a
quorum but will not be counted as for or against the matter.
Shareholder Proposals for the 1995 Annual Meeting
Proposals of shareholders intended to be presented at the 1995 Annual
Meeting of Shareholders and for inclusion in the Company's Proxy Statement
and form of Proxy relating to that meeting must be received by the
Secretary of the Company at the Company's Executive Offices, One Herald
Plaza, Miami, Florida 33132, by November 23, 1994. It is suggested that
proposals be submitted by Certified Mail Return Receipt Requested.
General
A shareholder may revoke his or her Proxy by giving notice to the Company
in writing or in open meeting.
All expenses incurred in connection with the solicitation of Proxies will
be borne by the Company.
In addition to solicitation by mail, arrangements may be made with
brokerage houses and other custodians, nominees, and fiduciaries to send
material to their principals, and the Company may reimburse them for these
expenses in so doing.
To the extent necessary and in order to insure sufficient participation in
the meeting, officers and regular employees of the Company may, without
additional remuneration, in person or by telephone or telegram, request the
return of Proxies. In addition, the Company has retained D.F. King & Co.,
Inc. for assistance in the solicitation of Proxies. For its services, D.F.
King will receive a fee estimated at $8,500, plus reimbursement for
reasonable and customary out-of-pocket expenses.
Except as stated above, the Board of Directors knows of no other business
to be presented at the meeting; but if any other matters come before the
meeting, the persons named in the enclosed Proxy will vote the Proxies in
accordance with their best judgment.
Douglas C. Harris
Vice President and Secretary
<PAGE>
PROXY CARD
This Proxy will be voted in accordance with the instructions indicated in
the spaces provided below. If no instruction is indicated, this Proxy will
be voted for the nominees listed below and for the Company Proposal and
against each of the three Shareholder Proposals.
___________ ___________
COMMON D.R.S.
The Board of Directors Recommends a Vote "For all Nominees" and "For" the
Company Proposal and "Against" each of the three Shareholder Proposals.
FOR ALL WITHHOLD FOR
NOMINEES ALL NOMINEES
Election of the following nominees as Directors:
Nominees for Election as Directors for Terms [ ] [ ]
Ending 1997
Alvah H. Chapman, Jr., Peter C. Goldmark, Jr.,
Barbara Barnes Hauptfuhrer, Williams S. Lee, and
John L. Weinberg
Nominees for Election as Directors for Terms
Ending 1995
Ben R. Morris and Eric Ridder
Nominee for Election as Director for Term
Ending 1996
Randall L. Tobias
To withhold authority to vote for any individual
nominee, write the name of that nominee in the
space below.
FOR AGAINST ABSTAIN
Company Proposal: Ratification of
Appointment of Ernst & Young as [ ] [ ] [ ]
Independent Auditors
FOR AGAINST ABSTAIN
Shareholder Proposal No. 1: Proposal requesting
a report relating to cigarette advertising. [ ] [ ] [ ]
Shareholder Proposal No. 2: Proposal that [ ] [ ] [ ]
the Company take required action to provide
for annual election of directors.
Shareholder Proposal No. 3: Proposal [ ] [ ] [ ]
relating to editorial policy on gun control
and related issues.
In their discretion, the proxies are authorized to vote upon such other
matters as may properly come before the meeting
Signature(s)_________________________ Date____________________
Note: Please mark, date and sign as your name appears at left and return
in the enclosed envelope. If acting as executor, administrator, trustee,
guardian, etc., you should so indicate when signing. If the signer is a
corporation, please sign the full corporate name, by duly authorized
officer.
[Over]
KNIGHT-RIDDER, INC.
This Proxy is Solicited on Behalf of the Board of Directors.
JAMES K. BATTEN and P. ANTHONY RIDDER, or either of them, with full
power of substitution, are hereby authorized to represent the undersigned
and to vote all shares of Common Stock of KNIGHT-RIDDER, INC. held of
record by the undersigned on March 15, 1994 at the Annual Meeting of
Shareholders of said Company to be held on May 4, 1994 and at any
adjournment(s) thereof:
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
