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 24, 1995
To Our Shareholders:
You are cordially invited to attend the Company's 1995 Annual Meeting of
Shareholders which will be held on Friday, May 5, 1995, 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 1995 Annual Meeting of Shareholders
to be Held Friday, May 5, 1995
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 Friday, May 5, 1995 for the following purposes:
1. To elect 5 directors;
and to consider and vote upon:
2. A proposal recommended by the Board of Directors that the shareholders
ratify the appointment of Ernst & Young LLP as independent auditors of the
Company for the year 1995 (the Company Proposal);
3. A shareholder proposal requesting preparation of a report relating to
cigarette advertising (Shareholder Proposal No.1); and
4. A shareholder proposal that the Company take the action necessary to
provide for the annual election of all directors (Shareholder Proposal No.
2);
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 16, 1995 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 24, 1995
<PAGE>
KNIGHT-RIDDER, INC.
One Herald Plaza, Miami, Florida 33132
PROXY STATEMENT
1995 Annual Meeting of Shareholders to be Held on Friday, May 5, 1995
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 Friday, May 5, 1995 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 25, 1994 are
being mailed together to shareholders for the first time on March 24, 1995.
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 LLP as the Company's independent auditors (the
Company Proposal), and against each of the two 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 16, 1995 on all matters which may come
before the meeting. On that date 50,458,416 shares of the Company's Common
Stock were outstanding and entitled to vote.
The following table sets forth information as of January 31, 1995 with
respect to the only persons 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 Owners Owned Class
The Northern Trust Company <F1> 4,912,766 9.50%
Fifty South LaSalle Street
Chicago, IL 60675
Southeastern Asset Management, Inc. 3,561,016 6.88%
6075 Poplar Avenue
Memphis, TN 38119
Regents of the University of California 2,650,200 5.12%
300 Lakeside Drive
Oakland, CA 94612
<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. Five directors are to be
elected at the 1995 Annual Meeting, three to hold office until the 1998
Annual Meeting of Shareholders and two to hold office until the 1996
Annual Meeting of Shareholders.
The individuals nominated by the Board of Directors to stand for election
at the 1995 Annual Meeting for three-year terms are James K. Batten, C.
Peter McColough and Gonzalo F. Valdes-Fauli, all of whom were elected by
shareholders at the 1992 Annual Meeting.
Ben R. Morris and Eric Ridder, who were elected by shareholders at the 1994
Annual Meeting of Shareholders, were nominated by the Board of Directors to
stand for election for one-year terms.
Barbara Knight Toomey, who was elected at the 1992 Annual Meeting, advised
the Nominating Committee that, because of personal commitments, she did not
wish to be nominated by the Board to stand for election at the 1995 Annual
Meeting.
The other ten directors who were elected at prior Annual Meetings will
continue to serve their respective terms.
Proxies will be voted for the election of the five 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 1998
[Photo]JAMES K. BATTEN, age 59 Director since 1981
Chairman of the Board and
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 Committee.
Mr. Batten was operated on for removal of a malignant brain tumor in the
summer of 1994. Since then, he has undergone various radiation and
chemotherapy treatments and, from time-to-time in 1994 and 1995, has not
been able to perform all his responsibilities on a full-time basis.
[Photo]C. PETER McCOLOUGH, age 72 Director since 1982
Former Chairman and Chief Executive
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]GONZALO F. VALDES-FAULI, age 48 Director since 1992
Regional Chief Executive
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 and member of
the Executive Committee of the University of Miami. Mr. Valdes-Fauli
serves on the Finance and Audit Committees.
NOMINEES FOR ELECTION AS DIRECTORS FOR TERMS ENDING 1996
[Photo]BEN R. MORRIS, age 72 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 76 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.
CONTINUING DIRECTORS
[Photo]ALVAH H. CHAPMAN, JR., age 73 Director since 1962
Former Chairman of the Board and Term Expires 1997
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. He also is a director of Community Partnership for
Homeless, Inc., the Community Anti-Drug Coalition of America, the Miami
Coalition for a Safe and Drug Free Community and Florida International
University Foundation and as Advisory Director 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]JOAN RIDDER CHALLINOR, age 67 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 board member of a
number of educational organizations, including the French-American
Foundation and the Schlesinger Library on the History of Women at Radcliffe
College (chairperson), and is a member of the Editorial Advisory Committee
of the Adams Papers. She serves on the Audit, Environmental Affairs and
Nominating Committees.
[Photo]PETER C. GOLDMARK, JR., age 54 Director since 1990
President of The Rockefeller Foundation Term Expires 1997
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 Port Authority of New York and New Jersey,
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 66 Director since 1979
Director of Various Public Companies Term expires 1997
Mrs. Hauptfuhrer graduated from Wellesley College. She 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 serves as a Trustee Emerita of Wellesley College. She chairs the
Nominating Committee and serves on the Compensation Committee.
[Photo]JESSE HILL, JR., age 68 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]WILLIAM S. LEE, age 65 Director since 1990
Retired Chairman and President of Term expires 1997
Duke Power Co.
Mr. Lee graduated from Princeton University. Until his retirement in 1994,
he was Chairman and President of Duke Power Co. in Charlotte, N.C., which
he joined in 1955. In 1994, he became Chairman Emeritus of Duke Power. He
is a director of J.P. Morgan & Co., Morgan Guaranty Trust Co., the Liberty
Corporation and Texas Instruments. Mr. Lee is Chairman of the Environmental
Affairs Committee and serves on the Compensation Committee.
[Photo]THOMAS L. PHILLIPS, age 70 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, Raytheon
Company and John Hancock Financial Services and is a trustee of State
Street Funds, Massachusetts General Hospital and Gordon College. He is
Chairman of the Finance Committee and serves on the Compensation Committee.
[Photo]P. ANTHONY RIDDER, age 54 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 and of the United Way of Dade County.
He is Chairman of the Operating Committee and serves on the Executive and
Environmental Affairs Committees.
[Photo]RANDALL L. TOBIAS, age 53 Director since 1994
Chairman and Chief Executive Officer Term expires 1996
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 and Kimberly-Clark Corporation. He is a trustee of Duke
University, the Colonial Williamsburg Foundation, and the Indiana
University Foundation and serves on the boards of the American Red Cross,
American Enterprise Institute, Committee for Economic Development, the
Indianapolis Museum of Art and the Indianapolis Symphony Orchestra. Mr.
Tobias serves on the Finance Committee.
[Photo]JOHN L. WEINBERG, age 70 Director since 1969
Senior Chairman Term expires 1997
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; Providian
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.
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, 1995 by each
director and 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
2.61% and 2.1%, respectively. All directors and officers of the Company as
a group beneficially owned 13.2% of the Company's Common Stock.
Total Number
of Shares
of Common Stock
Shares Other Beneficially
Than Option Shares Subject Owned
Name Shares to Options <F1> <F1><F2>
James K. Batten 41,481 290,000 331,481 <F3>
Joan Ridder Challinor 58,706 58,706 <F4>
Alvah H. Chapman, Jr. 136,058 136,058 <F3>
John C. Fontaine 4,397 44,000 48,397 <F3>
Peter C. Goldmark, Jr. 100 100
Barbara B. Hauptfuhrer 1,200 1,200 <F5>
Jesse Hill, Jr. 800 800
Ross Jones 1,546 20,000 21,546
William S. Lee 700 700
C. Peter McColough 400 400
Ben R. Morris 115,500 115,500 <F3>
Thomas L. Phillips 1,200 1,200
David K. Ray 7,726 74,350 82,076
Eric Ridder 1,110,534 1,110,534 <F6>
P. Anthony Ridder 65,341 196,000 261,341 <F3>
Randall L. Tobias 1,000 1,000
Barbara Knight Toomey 1,378,524 1,378,524 <F3><F7>
Gonzalo F. Valdes-Fauli 500 500
John L. Weinberg 14,000 14,000
All directors and officers
as a group (36) 6,002,034 951,275 6,953,309 <F8>
<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, 1995.
<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 -- 18,826 shares owned by Mrs. Batten as trustee; Mr. Chapman --
7,682 shares owned jointly with Mrs. Chapman; Mr. Fontaine -- 2,546 shares
owned jointly with Mrs. Fontaine; Mr. Morris -- 2,100 shares owned by Mrs.
Morris; Mr. P. Anthony Ridder -- 1,271 shares owned by Mrs. Ridder; and Mrs.
Toomey -- 600 shares owned by Mr. Toomey. Mrs. Toomey and Messrs. Morris 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 1,091,268 shares owned by the James L. Knight Trust. Mrs.
Toomey is a Trust Advisor to the Trustee of the Trust. Also includes
175,625 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 2,477,058 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 550,000
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 550,000 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 1994, the
Committee was comprised of Barbara B. Hauptfuhrer, Chairperson, Joan Ridder
Challinor, Alvah H. Chapman, Jr., Peter C. Goldmark, Jr. and C. Peter
McColough. The Committee met once in 1994.
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 1994, 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
five times in 1994.
The Audit Committee, which in 1994 was comprised of Jesse Hill, Jr.,
Chairman, Joan Ridder Challinor, Ben R. Morris, Barbara Knight Toomey, Eric
Ridder and Gonzalo F. 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 1994.
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 1994, was comprised
of Thomas L. Phillips, Chairman, Peter C. Goldmark, Jesse Hill, Jr., Ben R.
Morris, Eric Ridder, Randall L. Tobias and Gonzalo F. Valdes-Fauli.
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 1994.
In 1994, the Board of Directors met six times. Each of the nominees for
election at the Annual Meeting 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
except Mr. Tobias, who was elected at the 1994 Annual Meeting; Mr. Tobias
attended 75% of the Board meetings that he was eligible to attend, but was
unable to attend the one meeting of the Finance Committee.
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 1994. 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.
John L. Weinberg 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. Goldman, Sachs & Co. is an investment banking firm that
regularly performs services for the Company such as acting as a financial
advisor and serving as principal or agent for the Company in the purchase
and sale of securities. In the future, Goldman, Sachs & Co. may be called
upon to provide similar or other services for the Company.
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.
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
responsibility 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 1994 services to the Company's Chairman of the Board and
Chief Executive Officer, Mr. Batten, and 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, CFO & Treasurer; and Mr. Ray,
President of the Business Information Services Division and a Vice
President of the Company. 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 1994
compensation.
The Compensation Committee report is followed by tables that summarize the
compensation of members of senior management for the past three years,
stock options granted to and exercised by senior management in 1994 and the
estimated pension benefits that senior management will receive upon
retirement. The section concludes with a graph that 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 an executive's
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. In 1994, the Company
updated its review by comparing the salary, bonus and stock option grants
received by the Company's five most highly compensated senior executive
officers with salary, bonus and options received in 1993 by the top five
officers of the other companies included in the performance graph on page
14 and found results consistent with the 1993 review.
As a result of the 1993 study, the Committee recommended to the Board of
Directors, and the Board adopted, certain changes in the incentive
compensation plan, which first were applicable to the bonuses awarded for
1994. Key executives of the Company and its operating units are eligible
to participate in the plan; in 1994, approximately 485 executives
participated in the plan.
Under the amended plan, participants are eligible for cash bonuses ranging
from 25% of salary in the case of participants whose annual salary is below
$50,000 to 50% in the case of those whose salary exceeds $250,000.
Thirty-five percent of an executive's bonus potential is tied to his or her
performance of individual objectives established at the beginning of each
year and 65% of the executive's bonus potential is tied to the financial
performance of the Company or one of its operating units compared to
budget. If the Company or operating unit meets its financial budget, the
executive would receive 100% of that part (65%) of the potential bonus tied
to financial performance; performance below or exceeding budget would
result in payment ranging from 10% of the targeted bonus (in the case of
financial performance equal to 91% of budget) to 150% of the targeted bonus
(if the budget is exceeded by 10%).
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 1994, cash bonuses for Messrs. Batten, Ridder, Fontaine and Jones were
based upon the Company's operating profit in comparison to its budget and
upon an assessment of individual performance during the year.
Mr. Ray is President of the Company's Business Information Services
Division; the financial performance portion of his bonus was dependent 25%
on the operating profit of the Company compared to budget and 75% on the
operating profit performance of BIS compared to budget.
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 and Fontaine was
judged by the Committee on a subjective basis.
1994 Compensation of the Chief Executive Officer. During 1994, Mr.
Batten's salary was increased to $665,000 from $630,000, which it had been
since April 1, 1993. For the three and one-half years prior to April 1,
1993, Mr. Batten's salary had been $600,000. Mr. Batten was awarded a
bonus for 1994 of $325,000, compared to $170,000 for 1993.
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 1994, taken into account the criteria that would have been
applicable to him had he been a plan participant. In 1994, the Company
achieved 103% of its operating profit budget. The maximum bonus Mr. Batten
could have received under the plan, in light of that level of Company
operating profit performance, was $360,117. The maximum bonus Mr. Batten
could have received, had he been a plan participant and had the Company
achieved 110% of its operating profit budget, was $434,766.
The Committee granted Mr. Batten a 1994 stock option covering 35,000
shares; in each of the preceding three years, he received a grant of 30,000
shares. As we noted above, the comparative data we reviewed indicated that
a grant of this size was comparable to the median long-term compensation in
comparable companies and it is the policy of the Committee to make grants
in that range.
In assessing Mr. Batten's total compensation, we took into consideration
the fact that Mr. Batten was seriously ill in 1994 and at times was not
able to perform all his responsibilities on a full-time basis, but that he
was in the office a significant amount of time and participated in all
major decisions during that time.
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
the 1994 operating budget and also reflected assessments of their
individual performances.
Tax Considerations. Provisions of the federal tax law deny a company a tax
deduction to the extent an executive's total compensation (excluding
certain categories of compensation) exceeds $1 million. Since no officer
of the company received as much as $1 million in salary and bonus for 1994,
this provision had no effect on the Company in 1994. The Committee has
discussed, but has not decided how, the issue of tax deductibility should
affect its deliberations regarding executive compensation in the future.
All members of the Committee concur and join in this report to the
Knight-Ridder shareholders.
John L. Weinberg, Chairman
Barbara Barnes Hauptfuhrer
William S. Lee
C. Peter McColough
Thomas L. Phillips
Senior Executive Compensation
The following table summarizes the compensation during the past three years
of the chief executive officer, Mr. Batten, and each of the other four most
highly compensated senior executive officers in 1994.
SUMMARY COMPENSATION TABLE
Annual Compensation
Other
Annual
Salary Bonus Compensation
Name and Principal Position Year ($) ($)<F1> ($)<F2><F3>
James K. Batten 1994 656,250 325,000 --
Chairman and CEO 1993 622,500 170,000 --
1992 600,000 84,000 --
P. Anthony Ridder 1994 518,000 315,000 --
President 1993 490,750 134,000 --
1992 466,500 66,080 --
John C. Fontaine 1994 430,180 265,000 --
Executive Vice President 1993 390,000 105,000 --
1992 370,000 108,000 --
Ross Jones (5) 1994 364,167 196,458 --
Senior Vice President, CFO 1993 297,051 159,872 126,383
& Treasurer 1992 -- -- --
David K. Ray 1994 345,000 134,744 --
President of Business 1993 333,000 133,114 --
Information Services Division 1992 320,000 70,840 110,000
Long-Term
Compensation
Stock All
Option Other
Awards Compensation
Name and Principal Position Year (# of shares) ($)<F2><F4>
James K. Batten 1994 35,000 14,415
Chairman and CEO 1993 30,000 13,239
1992 30,000 12,764
P. Anthony Ridder 1994 28,000 8,808
President 1993 25,000 8,449
1992 25,000 8,107
John C. Fontaine 1994 20,000 14,187
Executive Vice President 1993 18,000 12,497
1992 16,000 11,917
Ross Jones <F5> 1994 14,000 8,243
Senior Vice President, CFO 1993 20,000 2,350
& Treasurer 1992 -- --
David K. Ray 1994 12,000 8,032
President of Business 1993 12,000 7,543
Information Services Division 1992 12,000 7,281
<F1> 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 1993 bonus shown for Mr. Jones
includes $75,000 paid to Mr. Jones when he joined the Company.
<F2> 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 1994 in an amount exceeding established reporting
thresholds.
<F3> 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
for 1993 relates to expenses incurred by the Company in connection with his
move to Miami when he joined the Company.
<F4> In the case of each executive, 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. The 401(k)
contributions in 1994, 1993 and 1992 were as follows: Mr. Batten -- $6,005,
$5,285 and $5,114; Mr. Ridder -- $4,620, $4,497 and $4,364; Mr. Fontaine --
$5,516, $4,985 and $4,827; Mr. Jones -- $5,385; and Mr. Ray -- $5,339, $4,914
and $4,764. The life insurance amounts in 1994, 1993 and 1992 were as
follows: Mr. Batten -- $8,409, $7,954 and $7,650; Mr. Ridder -- $4,188,
$3,952 and $3,743; Mr. Fontaine -- $8,670, $7,512 and $7,090; Mr. Jones --
$2,858 and $2,350; and Mr. Ray -- $2,693, $2,629 and $2,517.
<F5> Mr. Jones became an officer of the Company on February 23, 1993.
Stock Options Granted
The Company's long-term incentive program consists of its Employee Stock
Option Plan pursuant to which the Compensation Committee may grant key
executives options which give the executive the right at any time in the
succeeding ten years to purchase shares of the Company's stock at the
market price at the option grant date. The options granted in 1994 are
exercisable in three equal installments vesting over a three-year period
from the date of grant. Options permit executives who contribute to the
performance of the Company and the market price of its stock to benefit
along with the shareholders in increases in the value of the stock.
The following table sets forth information regarding stock options granted
in 1994 to each of the executive officers named earlier in the Summary
Compensation Table.
STOCK OPTION GRANTS IN LAST FISCAL YEAR
Number of % of Total
Securities Options
Underlying Granted to Exercise
Options Employees in Price Expiration
Name Granted Fiscal Year ($/share) Date
James K. Batten 35,000 4.84% 49.125 14-Dec-2004
P. Anthony Ridder 28,000 3.87% 49.125 14-Dec-2004
John C. Fontaine 20,000 2.77% 49.125 14-Dec-2004
Ross Jones 14,000 1.94% 49.125 14-Dec-2004
David K. Ray 12,000 1.66% 49.125 14-Dec-2004
Grant Date
Present Value
Name ($)
James K. Batten 544,250
P. Anthony Ridder 435,400
John C. Fontaine 311,000
Ross Jones 217,700
David K. Ray 186,600
The "grant date present value" shown is a hypothetical value based upon
application of the "Black-Scholes" model which often is used to estimate
the market value of transferable options by calculating the probability,
based on the volatility of the stock subject to the options, that the stock
price will exceed the option exercise price at the end of the option term.
The assumptions used in calculating the Black-Scholes value of the options
were expected volatility of .18, risk-free return of 7.93%, a dividend
yield of 2.9% and vesting of exercisability in equal annual installments
over a three-year period from the date of grant.
The Company's stock options are not transferable and, the Black-Scholes
estimate notwithstanding, an option granted under the Stock Option Plan
will have value to the optionee only if and to the extent the market price
of the Company's stock rises above the market price on the date the option
was granted.
Stock Options Exercised
The following table summarizes information regarding stock options
exercised in 1994 by each of the officers named in the table on page 11 and
the number of unexercised options held by them at the end of the year.
AGGREGATED STOCK OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END STOCK OPTION VALUES
Number of
Securities
Underlying
Unexercised
Options at
Shares Fiscal
Acquired on Value Year-end (#)
Exercise Realized Exercisable/
Name (#) ($) Unexercisable
James K. Batten 27,500 784,810 315,000/35,000
P. Anthony Ridder 7,500 226,235 196,000/28,000
John C. Fontaine -- -- 44,000/20,000
Ross Jones -- -- 20,000/14,000
David K. Ray 6,000 118,500 74,350/12,000
Value of
Unexercised
In-the-
Money
Options at
Fiscal
Year-end ($)<F1>
Exercisable/
Name Unexercisable
James K. Batten 1,414,063/61,250
P. Anthony Ridder 760,500/49,000
John C. Fontaine --/35,000
Ross Jones --/24,500
David K. Ray 277,413/21,000
<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 1994 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 $ 35,796 $ 41,478 $ 47,160 $ 52,842 $ 55,967
200,000 58,296 67,728 77,160 86,592 91,592
300,000 88,296 102,728 117,160 131,592 139,092
400,000 118,296 137,728 157,160 176,592 186,592
450,000 133,296 155,228 177,160 199,092 210,342
500,000 148,296 172,728 197,160 221,592 234,092
550,000 163,296 190,228 217,160 244,092 257,842
600,000 178,296 207,728 237,160 266,592 281,592
700,000 208,296 242,728 277,160 311,592 329,092
800,000 238,296 277,728 317,160 356,592 376,592
900,000 268,296 312,728 357,160 401,592 424,092
Years of Service
Remuneration 40
$125,000 $ 59,092
200,000 96,592
300,000 146,592
400,000 196,592
450,000 221,592
500,000 246,592
550,000 271,592
600,000 296,592
700,000 346,592
800,000 396,592
900,000 446,592
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 1994, Mr.
Batten had 32 years of services with the Company, Mr. Ridder 33, Mr. Ray
15, Mr. Fontaine 7, and Mr. Jones 2. 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.
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, 1989 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.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
KNIGHT-RIDDER, INC., S&P PUBLISHING/NEWSPAPERS INDEX
AND S&P 500 INDEX
DECEMBER 31, 1989 - DECEMBER 31, 1994
1989 1990 1991 1992 1993 1994
Knight-Ridder, Inc. $100.00 $80.74 $ 95.91 $107.73 $113.76 $ 98.84
S&P 500 $100.00 $96.89 $126.42 $136.05 $149.76 $151.74
S&P Publishing/ $100.00 $80.14 $ 97.04 $108.51 $125.68 $116.11
Newspapers
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 period ending May
31, 1995. The Company has agreed to pay Mr. Chapman at an annual rate of
$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 Relationships and Reports of Certain Stock Transactions
Joan Ridder Challinor and Eric Ridder are first cousins. Peter B. Ridder,
President and Publisher of the Saint Paul Pioneer Press, is 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 1994 of $762,675.
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 1994, except that Clark Hoyt, a Vice President
of the Company, inadvertently was late in reporting the sale of 400 shares
of Common Stock.
See "Compensation Interlocks and Insider Participation" on page 7 for
information concerning transactions between the Company and organizations
with which Mrs. Hauptfuhrer and Mr. Weinberg are associated.
Proposals
Company Proposal -- Ratification of Appointment of Independent Auditors
Ernst & Young LLP, 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 1995. 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 LLP 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, owner of 100 shares of Common Stock; Mercy Health Services, 34605
Twelve Mile Road, Farmington Hills, Michigan 48331-3221, owner of 1,216
shares of Common Stock; and The Sisters of St. Francis of Philadelphia, Our
Lady of Angels Convent-Glen Riddle, Aston, Pennsylvania 19014, owner of
22,000 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,
for the decision: "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, 1996. 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 preparing 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 the present
forms of cigarette advertising. Supporting the First Amendment and arguing
against government regulation to ban advertising, Frank Blethen declared,
"We are exercising the independent judgment that is our responsibility as a
newspaper." Michael R. Fancher, 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 initiative and insights. So, the question was seen as one of business
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" for this resolution."
The Board of Directors recommends that Shareholders vote AGAINST
Shareholder Proposal No. 1
Management's Position
This identical proposal was presented to the shareholders at the 1994
Annual Meeting and was opposed by the vote of more than 90% of the shares
which voted on the proposal. 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.
The Board reviewed the matter again in 1994 and confirmed its earlier
conclusion. 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.
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 800 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 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. Our
Company is currently performing well in a precarious market, but that does
not justify policies that diminish accountability to The Shareholders."
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. Ms. Roisman submitted this identical proposal
to the 1994 Annual Meeting, and it was opposed by shareholders then by a
vote of more than two to one.
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.
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 and 2 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 earlier, 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 1996 Annual Meeting
Proposals of shareholders intended to be presented at the 1996 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 24, 1995. 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 $9,000, 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>
KNIGHT-RIDDER, INC.
This Proxy is Solicited on Behalf of the Board of Directors.
JAMES K. BATTEN, P. ANTHONY RIDDER and JOHN C. FONTAINE, or any 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 16, 1995 at the Annual
Meeting of Shareholders of said Company to be held on May 5, 1995 and at
any adjournment(s) thereof:
THIS PROXY IS CONTINUED ON THE REVERSE SIDE
PLEASE SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY
[Over]
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 two 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 two Shareholder Proposals.
FOR ALL WITHHOLD FOR
NOMINEES ALL NOMINEES
Election of the following nominees as Directors:
Nominees for Election as Directors for Terms [ ] [ ]
Ending 1998
James K. Batten, C. Peter McColough and
Gonzalo F. Valdes-Fauli
Nominees for Election as Directors for Terms
Ending 1996
Ben R. Morris and Eric Ridder
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.
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 above 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.
<PAGE>
APPENDIX
Photographs of Director Candidates appear on pages 3 - 5.
