<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
THE TIMES MIRROR COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] 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:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] 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.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
[LOGO OF TIMES MIRROR]
Times Mirror Square
Los Angeles, CA 90053
MARK H. WILLES
Chairman, President and
Chief Executive Officer,
and Publisher,
Los Angeles Times
March 27, 1998
Dear Times Mirror Shareholder:
We are pleased to invite you to attend the 1998 Annual Meeting of
Shareholders of The Times Mirror Company. The meeting will be held at the
offices of Newsday, Inc. at 235 Pinelawn Road in Melville, New York on
Thursday, May 7, 1998 at 10:30 a.m., Eastern Time.
Our agenda will include the formal items of business described in the
accompanying Notice of Annual Meeting and Proxy Statement, as well as a report
on the operations of Times Mirror during 1997 and an opportunity for
questions. We will also be honoring our employees who have won awards for
journalistic and editorial excellence and for innovative products and
processes that help us grow revenues and better serve our customers.
We encourage you to attend the meeting in person. Whether or not you plan to
attend, your vote is important, regardless of the number of shares which you
own. Please complete, sign and return the enclosed proxy card as soon as
possible so that your shares will be represented. If you do plan to attend the
meeting, please check the appropriate box on the proxy card.
We hope to see you at the Annual Meeting on May 7.
Sincerely,
/s/ Mark H. Willes
Mark H. Willes
Chairman of the Board, President and
Chief Executive Officer, and
Publisher, Los Angeles Times
<PAGE>
[LOGO OF TIMES MIRROR]
----------------
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
----------------
NOTICE OF ANNUAL MEETING
As a shareholder, you are invited to be represented in person or by proxy at
the Annual Meeting of Shareholders of The Times Mirror Company to be held at
the offices of Newsday, Inc. at 235 Pinelawn Road in Melville, New York on
Thursday, May 7, 1998 at 10:30 a.m., Eastern Time, for the following purposes:
1. To elect four persons to Class III of the Board of Directors in
accordance with Article VIII, Section 1 of the Company's Certificate of
Incorporation.
2. To consider and act upon a proposal to ratify the appointment by the
Board of Directors of Ernst & Young LLP as independent auditors for the
Company and its subsidiaries for the year ending December 31, 1998.
3. To transact such other business as may properly come before the meeting.
The Board of Directors has fixed the close of business on March 9, 1998 as
the record date for the determination of shareholders entitled to notice of
and to vote at the meeting.
It is important that your shares are represented at the meeting whether or
not you plan to attend in person. Accordingly, you are requested to mark,
sign, date and return the enclosed proxy as promptly as possible. A return
envelope is provided for your convenience.
By Order of the Board of Directors,
/s/ Stephen C. Meier
Stephen C. Meier
Secretary
March 27, 1998
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Proxy Statement........................................................... 1
Election of Directors..................................................... 2
Nominees for Directors.................................................... 2
Continuing Directors...................................................... 4
Compensation of Directors................................................. 6
Committees of the Board of Directors...................................... 7
Appointment of Independent Auditors....................................... 8
Other Matters............................................................. 8
Ownership of Voting Securities............................................ 9
Executive Compensation.................................................... 13
Option Grants Table....................................................... 15
Aggregated Option Exercises in 1997 and Option Values as of December 31,
1997..................................................................... 16
Report of the Compensation Committee on Executive Compensation............ 17
Compensation Committee Interlocks and Insider Participation............... 18
Stock Price Performance Graph............................................. 19
Retirement Plans.......................................................... 20
Certain Relationships and Related Transactions............................ 21
Section 16(a) Beneficial Ownership Reporting Compliance................... 23
Revocation of Proxies..................................................... 23
1999 Annual Meeting....................................................... 23
General................................................................... 23
</TABLE>
<PAGE>
PROXY STATEMENT
----------------
ANNUAL MEETING OF SHAREHOLDERS OF
THE TIMES MIRROR COMPANY
----------------
MAY 7, 1998
This Proxy Statement is furnished in connection with the solicitation by the
directors of The Times Mirror Company (the "Company") of proxies for use at
the Annual Meeting of Shareholders to be held on Thursday, May 7, 1998 or at
any adjournment or postponement of the meeting (the "1998 Annual Meeting"), as
set forth in the accompanying notice. This Proxy Statement and the
accompanying proxy card are first being mailed to shareholders on or about
March 27, 1998. A shareholder giving a proxy may revoke it at any time before
it is exercised (see Revocation of Proxies on page 23). Any proxy which is not
revoked will be voted at the meeting in accordance with the shareholder's
instructions. Unless otherwise directed in the accompanying proxy, the proxy
holders named in the proxy will vote FOR the election of all of the nominees
for director to Class III of the Board of Directors; and FOR the proposal to
ratify the appointment of Ernst & Young LLP as independent auditors for the
year ending December 31, 1998.
On March 9, 1998, the record date for the determination of Company
shareholders entitled to notice of and to vote at the meeting, 63,128,823
shares of Series A Common Stock and 25,472,038 shares of Series C Common Stock
were outstanding. Each share of Series A Common Stock is entitled to one vote
and each share of Series C Common Stock is entitled to ten votes on all
matters. Shareholders have the right to elect directors by cumulative voting,
with each share allocated a number of votes equal to the votes to which the
share is entitled times the number of directors to be elected, which votes may
be cast for one candidate or distributed among any two or more candidates.
The four nominees for director who receive the greatest number of votes cast
will be elected. An affirmative vote of a majority of the shares present and
voting at the meeting is required for approval of the proposal to ratify the
appointment of Ernst & Young LLP as independent auditors for the year ending
December 31, 1998. Abstentions and broker non-votes are each included in the
determination of the number of shares present at the meeting. Each is
tabulated separately. Abstentions are counted in tabulations of the votes cast
on proposals presented to shareholders, but broker non-votes are not counted
for purposes of determining whether a proposal has been approved.
The annual report of the Company for the year ended December 31, 1997 is
being mailed to shareholders with this Proxy Statement.
THE TIMES MIRROR COMPANY
TIMES MIRROR SQUARE, LOS ANGELES, CALIFORNIA 90053
<PAGE>
ELECTION OF DIRECTORS
One of the purposes of the 1998 Annual Meeting is the election of four
persons to Class III of the Board of Directors in accordance with Article
VIII, Section 1 of the Company's Certificate of Incorporation. As indicated
above, shareholders have the right to elect directors by cumulative voting.
Unless instructed to the contrary, the persons named in the accompanying proxy
intend to vote the shares equally for the election of all of the nominees
named in this Proxy Statement to Class III of the Board of Directors. However,
if votes are cast for any nominee other than those named in this Proxy
Statement, the proxy holders will have full authority to vote cumulatively and
to allocate votes among any or all of the Company's nominees (except to the
extent that authority to vote particular shares for any particular nominee is
withheld) according to their sole discretion, in order to elect the maximum
number of the nominees named in this Proxy Statement to Class III of the Board
of Directors. Although it is not contemplated that any nominee will decline or
be unable to serve, the shares will be voted by the proxy holders in their
discretion for another person if such a contingency should arise. The term of
each person elected as a director will continue until that director's term has
expired and until his or her successor is elected and qualified.
Gwendolyn Garland Babcock, Clayton W. Frye, Jr., William Stinehart, Jr. and
Mark H. Willes were recommended by the Nominating Committee for election at
the 1998 Annual Meeting to serve until the Annual Meeting to be held in 2001
and until their respective successors are elected and qualified. Two
directors, C. Michael Armstrong and Richard T. Schlosberg III, resigned from
the Board of Directors during 1997, and four current directors in Class III
have not been nominated for reelection. In order to keep the classes of the
Board of Directors as equal as possible following the 1998 Annual Meeting,
Mrs. Babcock, who is currently a member of Class I, and Mr. Stinehart, who is
currently a member of Class II, have been nominated for election to Class III
along with Messrs. Frye and Willes, who are currently members of Class III. In
addition, the number of authorized directors fixed in the Company's Bylaws
will be reduced to eleven immediately following the 1998 Annual Meeting and,
therefore, proxies cannot be voted for a greater number of persons than the
number of nominees named below.
The current term of directors in Class I will continue until the Annual
Meeting in 1999 and the current term of directors in Class II will continue
until the Annual Meeting in 2000 and, in each case, until their respective
successors are elected and qualified. The name, age and principal business or
occupation of each of the continuing directors and nominees are shown below in
the brief description beside the photograph of each of the directors. The
description also includes the year in which each of the directors first became
a director of the Company, the committee memberships of each, and certain
other information. The directors' and nominees' ownership of equity securities
of the Company at March 9, 1998 is indicated in the section entitled
"Ownership of Voting Securities" beginning on page 9.
----------------
NOMINEES FOR DIRECTORS
Each of the persons listed below is nominated for election to Class III of
the Board of Directors (to serve three-year terms ending at the Annual Meeting
to be held in 2001 and until their respective successors are elected and
qualified).
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE ELECTION OF
EACH OF THE NOMINEES.
GWENDOLYN GARLAND BABCOCK, 62, has been a director of the
Company since 1976 and is a member of the Nominating
[PHOTO APPEARS Committee. She has been a private investor for more than
HERE] five years. Mrs. Babcock is a graduate of Bryn Mawr College
and is a member of the Board of Overseers of The Huntington
Library, Art Collections and Botanical Gardens. She is also
a trustee of the Chandler Trusts. (See Certain Relationships
and Related Transactions beginning on page 21.) She is
currently a director in Class I of the Board of Directors.
2
<PAGE>
NOMINEES FOR DIRECTORS (CONTINUED)
CLAYTON W. FRYE, JR., 67, has been a director of the Company
since 1988 and is Chairman of the Compensation Committee and
the Executive Compensation Subcommittee of the Compensation
[PHOTO APPEARS Committee and a member of the Nominating Committee and the
HERE] Finance Committee. He is the Senior Associate of Laurance S.
Rockefeller. He has served in that capacity since 1973 and
is responsible for overseeing and directing Mr.
Rockefeller's business, real estate and investment interests
as well as managing his own business and real estate
interests. Mr. Frye is a graduate of Stanford University
where he received both a B.A. degree and an M.B.A. degree.
He is a partner in Rockefeller and Associates Realty, a
Director of Tejon Ranch Company and several privately-held
companies including King Ranch, Inc. Mr. Frye serves on The
Advisory Council of The Stanford University Graduate School
of Business and is a Trustee of The White House Historical
Association and other not-for-profit Foundations.
WILLIAM STINEHART, JR., 54, has been a director of the
Company since 1991 and is a member of the Nominating
Committee and the Finance Committee. He is a partner in the
law firm of Gibson, Dunn & Crutcher LLP where he has
[PHOTO APPEARS practiced law since 1969. Gibson, Dunn & Crutcher LLP has
HERE] provided legal services to the Company and its subsidiaries
for many years and is expected to do so in the future. Mr.
Stinehart holds a B.A. degree from Stanford University and a
J.D. degree from UCLA Law School, and is a member of the
Board of Trustees of the Harvey and Mildred Mudd Foundation.
He is also a trustee of the Chandler Trusts. (See Certain
Relationships and Related Transactions beginning on page
21). He is currently a director in Class II of the Board of
Directors.
MARK H. WILLES, 56, is Chairman of the Board, President and
Chief Executive Officer of the Company. A director of the
Company since June 1, 1995, Mr. Willes was also elected
President and Chief Executive Officer of the Company at that
[PHOTO APPEARS time. He was elected Chairman of the Board effective January
HERE] 1, 1996 and became Publisher of the Los Angeles Times in
September 1997. Prior to joining the Company, Mr. Willes was
employed by General Mills, Inc., commencing in 1980, where
he held a variety of positions including Chief Financial
Officer, President and Chief Operating Officer and, at the
time of his departure, Vice Chairman of the Board of
Directors. He was also a director of that company. Mr.
Willes was President of the Federal Reserve Bank of
Minneapolis from 1977 to 1980. In 1971, Mr. Willes joined
the Philadelphia Reserve Bank where he held a number of
positions including Director of Research and First Vice
President. He was Assistant Professor of Finance and
Commerce at the University of Pennsylvania from 1967 to
1971. Mr. Willes received an undergraduate degree from
Columbia College and a doctorate from Columbia Graduate
School of Business. He is also a director of The Black &
Decker Corporation and Talbots, Inc.
3
<PAGE>
CONTINUING DIRECTORS
CLASS I (currently serving until the 1999 Annual Meeting and until their
respective successors are elected and qualified):
DONALD R. BEALL, 59, has been a director of the Company
since 1990 and is a member of the Compensation Committee,
Executive Compensation Subcommittee of the Compensation
Committee and the Nominating Committee. He is Chairman of
[PHOTO APPEARS the Executive Committee and Retired Chairman of the Board
HERE] and Chief Executive Officer of Rockwell International
Corporation, a leading provider of technology solutions in
the industrial automation, semiconductor systems, avionics
and communications systems and automotive component systems
business. Prior to assuming his positions as Chairman of the
Board and Chief Executive Officer in February 1988, Mr.
Beall served as President and Chief Operating Officer of
Rockwell International for ten years. Mr. Beall received a
B.S. degree from San Jose State University and an M.B.A.
degree from the University of Pittsburgh. He is also a
director of Amoco Corporation and Procter & Gamble Co.
JOAN A. PAYDEN, 66, has been a director of the Company since
1993 and is a member of the Audit Committee, the Finance
Committee and the Public Responsibility Committee. She is a
founder, president and chief executive officer of Payden &
[PHOTO APPEARS Rygel, an investment management firm registered under the
HERE] Investment Company Act of 1940 which manages domestic and
global fixed-income portfolios. She has held those positions
since the formation of the firm in 1983. Prior to that time,
Ms. Payden was the managing partner of the west coast
operation of Scudder, Stevens & Clark. Ms. Payden has a B.A.
degree in Mathematics and Physics from Trinity College in
Washington, D.C. and completed graduate study at Columbia
University as well as the Advanced Management Program at
Harvard Business School. She is a chartered financial
analyst and is the President of the Investment Counseling
Association of America. She is also a director of the Los
Angeles Chamber of Commerce, a trustee of the Pacific Asia
Museum and of Loyola Marymount University, and a member of
the Board of Visitors of the Anderson Graduate School of
Management at UCLA.
WARREN B. WILLIAMSON, 69, has been a director of the Company
since 1977 and is Chairman of the Finance Committee and a
member of the Compensation Committee. He is Chairman of the
[PHOTO APPEARS Board of Trustees of the Chandler Trusts. (See Certain
HERE] Relationships and Related Transactions beginning on page
21). In 1989, Mr. Williamson retired from Crowell, Weedon
and Co., a stock brokerage firm with which he had been
associated since 1970. Mr. Williamson is a graduate of
Claremont Men's College. He is a director of Hollywood Park,
Inc. and Chairman Emeritus of the Trustees of the Art Center
College of Design.
4
<PAGE>
CONTINUING DIRECTORS
CLASS II (currently serving until the 2000 Annual Meeting and until their
respective successors are elected and qualified):
JOHN E. BRYSON, 54, has been a director of the Company since
1991 and is a member of the Compensation Committee, the
Executive Compensation Subcommittee of the Compensation
[PHOTO APPEARS Committee and the Audit Committee. He is Chairman of the
HERE] Board and Chief Executive Officer of Edison International
Company and its largest subsidiary, Southern California
Edison Company, a public utility. He has held those
positions since October 1990. Mr. Bryson holds a B.A. degree
from Stanford University and a J.D. degree from Yale Law
School. Mr. Bryson is also a director of The Boeing Co. and
the W.M. Keck Foundation and a trustee of Stanford
University.
BRUCE CHANDLER, 61, has been a director of the Company since
1975 and is a member of the Finance Committee. He has been a
private investor since 1989. From 1968 to 1989, he practiced
law in the State of California. Mr. Chandler is a graduate
[PHOTO APPEARS of the University of Southern California and holds a J.D.
HERE] degree from the University of San Diego School of Law. He is
also a trustee of the Chandler Trusts. (See Certain
Relationships and Related Transactions beginning on page
21.)
DR. ALFRED E. OSBORNE, JR., 53, has been a director of the
Company since 1980 and is Chairman of the Audit Committee
and a member of the Compensation Committee, the Executive
[PHOTO APPEARS Compensation Subcommittee of the Compensation Committee and
HERE] the Nominating Committee. He is Director of the Harold Price
Center for Entrepreneurial Studies and Associate Professor
of Business Economics at the Anderson Graduate School of
Management at UCLA. He has been with UCLA since 1972. From
August 1977 to July 1979, Dr. Osborne served as a Brookings
Institution Economic Policy Fellow at the Securities and
Exchange Commission. He holds a bachelor's degree in
electrical engineering, a master's degree in economics, a
master of business administration in finance and a doctorate
in business-economics, all from Stanford University. He is
also a director of Greyhound Lines, Inc., Nordstrom, Inc.
and United States Filter Corporation. He is a trustee of
Sierra Trust Funds and an independent general partner of
Technology Funding Venture Partners V, a 1940 Investment
Company Act company.
DR. EDWARD ZAPANTA, 59, has been a director of the Company
since 1988 and is Chairman of the Nominating Committee and a
member of the Public Responsibility Committee, the
[PHOTO APPEARS Compensation Committee and the Executive Compensation
HERE] Subcommittee of the Compensation Committee. He is a
practicing physician providing neurosurgical care in the Los
Angeles area. He has been in private practice since 1970.
Dr. Zapanta attended UCLA, received his M.D. degree from the
University of Southern California School of Medicine, and
currently serves as a trustee of the University of Southern
California. He is a clinical professor of surgery,
department of Neurological Surgery, at the University of
Southern California. Dr. Zapanta is also Senior Medical
Director of HealthCare Partners Medical Group and a director
of Edison International and the Irvine Foundation.
5
<PAGE>
COMPENSATION OF DIRECTORS
The Board of Directors presently has fifteen directors, two of whom are
salaried employees of the Company. Salaried employees receive no additional
compensation or benefits for their service as directors. During 1997, each
non-employee director received an annual retainer of 500 shares of Series A
Common Stock. In addition, each of them received a cash payment equal to the
value of 500 shares of such stock, based on an average of the prevailing
market prices at the time. Non-employee chairpersons of committees of the
Board also received an annual retainer of 60 shares of Series A Common Stock
and a cash payment equal to the value of 60 shares of such stock. A director
may also elect to receive the cash portion of the annual retainer or the
chairperson retainer in the form of Series A Common Stock.
Non-employee directors also receive annually an option grant for 5,000
shares of Series A Common Stock under the Company's 1997 Directors Stock
Option Plan. These stock options are immediately exercisable at a price equal
to the fair market value of the Series A Common Stock on the date of grant and
have a term of ten years.
Non-employee directors may elect to defer the receipt of any part of their
retainer. If a director defers receipt of the cash portion and/or stock
portion of the retainer, an amount valued with reference to shares of Series A
Common Stock will be credited to an unfunded stock unit account. During the
deferral period, this account will be credited with additional stock units
equal to the value of dividends declared on the Series A Common Stock
represented by stock units in the account. The aggregate value of the stock
units will be distributed in shares of Series A Common Stock under The Times
Mirror Non-Employee Directors Stock Plan at the end of the deferral period and
over the payment period selected by the director.
Prior to December 31, 1996, non-employee directors participated in the
Company's Pension Plan for Directors, which provided for the payment after
retirement from the Board of an annual benefit equal to the sum of the amount
of the annual retainer at the time of retirement plus the amount of the Board
and committee attendance fees paid or payable for the calendar year preceding
retirement. The duration of the payment equaled the number of years of service
as an outside director.
In January 1997, the Board determined that benefit accruals under the
Pension Plan for Directors would cease effective December 31, 1996, and that
no future directors would be entitled to participate in the plan. Directors
who retired prior to 1997 will continue to receive benefits previously earned
under that pension plan and directors who were on the Board as of January 1,
1997 have received or will receive (either in a lump sum payment or in
installments) an amount in lieu of benefits accrued under the pension plan as
of December 31, 1996. For each director who elected to receive a future
payment of such amount, the Company entered into an agreement with that
director specifying the Company's obligation to accumulate amounts at 9%
compounded annually and to make payments at the date and over the period
specified by the director.
For each non-employee director, the Company provides $150,000 life insurance
coverage and $100,000 travel accident insurance for travel on Company
business.
6
<PAGE>
COMMITTEES OF THE BOARD OF DIRECTORS
The standing committees of the Board are the Audit Committee, Compensation
Committee, Executive Compensation Subcommittee of the Compensation Committee,
Finance Committee, Nominating Committee and Public Responsibility Committee.
The functions of each of these six committees are described and the members of
each are listed below.
Each year, the Audit Committee reviews the Company's audit plan, the scope
of activities of the independent auditors and of the internal auditors, the
results of the audit after completion, and the fees for services performed
during the year, and recommends to the Board of Directors the firm to be
appointed as independent auditors. During a portion of each meeting, this
Committee meets with representatives of the independent auditors without
officers or employees of the Company present. The members of the Audit
Committee are Dr. Alfred E. Osborne, Jr. (Chairman), John E. Bryson, Robert F.
Erburu, Joan A. Payden and Harold M. Williams, none of whom is either an
officer or employee of the Company. The Audit Committee met three times in
1997.
The Compensation Committee administers the Company's employee and management
compensation and stock plans, determines the compensation of officers of the
Company, authorizes and approves bonus-incentive compensation and stock option
programs for personnel of the Company and considers and discusses other
matters relating to key executive personnel, including management succession
and promotions. Clayton W. Frye, Jr. (Chairman), Donald R. Beall, John E.
Bryson, Dr. Alfred E. Osborne, Jr., Warren B. Williamson and Dr. Edward
Zapanta, none of whom is either an officer or employee of the Company, are the
members of the Compensation Committee. The Compensation Committee met three
times in 1997.
The Executive Compensation Subcommittee of the Compensation Committee
determines the compensation of and approves stock option grants to executive
officers of the Company. Clayton W. Frye, Jr. (Chairman), Donald R. Beall,
John E. Bryson, Dr. Alfred E. Osborne, Jr. and Dr. Edward Zapanta, none of
whom is either an officer or employee of the Company, are the members of this
Subcommittee. This Subcommittee was created in February 1998 and, therefore,
did not meet in 1997.
The Finance Committee reviews financial policies and performance objectives
as developed by the Company's management. Warren B. Williamson (Chairman),
Bruce Chandler, Clayton W. Frye, Jr., Joan A. Payden, William Stinehart, Jr.
and Harold M. Williams are the members of the Finance Committee, which met
once in 1997.
The Nominating Committee considers and recommends to the Board nominees for
possible election to the Board of Directors and considers other matters
pertaining to the size and composition of the Board of Directors and its
committees. The members of the Nominating Committee are Dr. Edward Zapanta
(Chairman), Gwendolyn Garland Babcock, Donald R. Beall, Otis Chandler, Clayton
W. Frye, Jr., Dr. Alfred E. Osborne, Jr. and William Stinehart, Jr. The
Nominating Committee recommended the nomination of all of the nominees to
Class III for election at the 1998 Annual Meeting. The Nominating Committee
will give appropriate consideration to qualified persons recommended by
shareholders as possible nominees, if such recommendations are accompanied by
information sufficient to enable the Nominating Committee to evaluate the
qualifications of the persons recommended and such persons consent to be
considered. Such recommendations must be submitted in writing to the Secretary
of the Company by no later than December 31 preceding the annual meeting of
shareholders at which directors are to be elected. The Nominating Committee
met twice in 1997.
The Public Responsibility Committee reviews and evaluates policies and
practices of the Company to assure that they are consistent with high
standards of responsible corporate conduct, as well as with the Company's
legal and other obligations to its employees, consumers, communities and
society as a whole. The members of the Public Responsibility Committee are
Harold M. Williams (Chairman), Otis Chandler, Robert F. Erburu, Joan A. Payden
and Dr. Edward Zapanta. The Public Responsibility Committee met once in 1997.
7
<PAGE>
In 1997, there were seven meetings of the Board of Directors. During the
year, each of the incumbent directors, other than Otis Chandler and Donald R.
Beall, attended at least 75% of the aggregate number of meetings of the Board
and the committees on which he or she sits. C. Michael Armstrong resigned from
the Board of Directors as well as the Finance Committee and the Public
Responsibility Committee effective December 16, 1997 and Richard T. Schlosberg
resigned from the Board of Directors effective October 9, 1997.
APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company, on the recommendation of its Audit
Committee (consisting of directors who are neither officers nor employees of
the Company--see page 7), has appointed Ernst & Young LLP as independent
auditors for the Company and its subsidiaries for 1998. As a matter of
corporate practice, the Company is submitting the appointment of Ernst & Young
LLP to shareholders for ratification. If shareholders fail to ratify the
appointment, the Audit Committee will review its selection for subsequent
years.
Ernst & Young LLP has served as independent auditors for the Company since
1936. One or more members of the firm will attend the 1998 Annual Meeting.
Ernst & Young LLP has indicated that it does not presently intend to make a
statement at the 1998 Annual Meeting, but a member of the firm will be
available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE APPOINTMENT
OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS.
OTHER MATTERS
Management does not know of any matter to be acted upon at the 1998 Annual
Meeting other than the matters described above. If any other matter properly
comes before the 1998 Annual Meeting, however, the proxy holders will vote on
those matters in accordance with their best judgment.
8
<PAGE>
OWNERSHIP OF VOTING SECURITIES
BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS
The following table sets forth the ownership of the outstanding shares of
the voting securities of the Company as of March 9, 1998 (except as otherwise
noted), held by persons known to the Company to beneficially own more than 5%
of the outstanding shares of a class of voting securities of the Company and
by certain employee benefit plans maintained by the Company for various
qualified retirement plans for employees of the Company and its subsidiaries.
Unless otherwise indicated, beneficial ownership numbers represent shares over
which the beneficial owner has sole voting and dispositive power.
<TABLE>
<CAPTION>
SERIES A PERCENT SERIES C PERCENT
NAME AND ADDRESS OF COMMON OF COMMON OF
BENEFICIAL OWNER STOCK SERIES(1) STOCK SERIES(1)
------------------- --------- --------- ---------- ---------
<S> <C> <C> <C> <C>
The Trustees of the Chandler
Trusts(2)........................... 9,305,624 14.74% 20,757,246 81.49%
350 West Colorado Boulevard
Suite 230
Pasadena, CA 91105
The Times Mirror Employee Stock
Ownership Trust(3).................. 3,212,608 5.09% 1,619,949 6.36%
Times Mirror Square
Los Angeles, CA 90053
Times Mirror Savings Plus Plan
Trust(4)............................ 2,253,732 3.57% 181,518 .71%
Times Mirror Square
Los Angeles, CA 90053
FMR Corp.(5)......................... 9,856,113 15.6% -- --
82 Devonshire Street
Boston, MA 02109
Soros Fund Management LLC(6)......... 6,266,200 9.93% -- --
George Soros
Stanley F. Druckenmiller
Duquesne Capital Management, L.L.C.
888 Seventh Avenue, 33rd Floor
New York, NY 10106
Putnam Investments, Inc.(7).......... 4,182,017 6.62% -- --
Marsh & McLennan Companies, Inc.
Putnam Investment Management, Inc.
The Putnam Advisory Company, Inc.
One Post Office Square
Boston, MA 02109
</TABLE>
- --------
(1) The percentages are based on the number of shares outstanding of each
class of voting securities as of March 9, 1998, as reflected in the
records of the Company.
(2) On March 9, 1998, the Chandler Trusts owned in the aggregate 9,305,624
shares of Series A Common Stock and 20,757,246 shares of Series C Common
Stock. In addition to her interests in shares held by the Chandler Trusts,
Gwendolyn Garland Babcock holds 12,256 shares of Series A Common Stock
(over all of which Mrs. Babcock has sole voting and dispositive power),
including 10,000 shares of Series A Common Stock which she may acquire
upon the exercise of outstanding stock options and 1,013 stock units
deferred under The Times Mirror Non-Employee Directors Stock Plan. Her
husband holds 1,862 shares of Series A Common Stock and 448 shares of
Series C Common Stock, and Mrs. Babcock, together with her husband, holds
as co-trustee 3,229 shares of Series A Common Stock and 12,212 shares of
Series C Common Stock, of which she disclaims beneficial ownership. In
addition to his interests in shares held by the Chandler Trusts, Otis
Chandler (individually and as a trustee) and his wife hold an aggregate of
12,970 shares of
9
<PAGE>
Series A Common Stock (of which Mr. Chandler has sole voting and
dispositive power over 12,595 shares), including 11,410 shares of Series A
Common Stock which he may acquire upon the exercise of outstanding stock
options and 3,983 shares of Series C Common Stock. In addition to
Mrs. Babcock, five other trustees of the Chandler Trusts own Series A
Common Stock individually or as trustee as follows: 163,801 shares by
Camilla Chandler Frost (over all of which Mrs. Frost has sole voting and
dispositive power); 436 shares by Douglas Goodan (over all of which Mr.
Goodan has sole voting and dispositive power); 11,248 shares by Bruce
Chandler (over all of which Mr. Chandler has sole voting and dispositive
power), including 10,000 shares of Series A Common Stock which he may
acquire upon the exercise of outstanding stock options; 12,758 shares by
William Stinehart, Jr. (of which he has sole voting and dispositive power
over 12,015 shares), including 10,000 shares of Series A Common Stock which
he may acquire upon the exercise of outstanding stock options and 2,015
stock units deferred under The Times Mirror Non-Employee Directors Stock
Plan; and 12,540 shares by Warren B. Williamson (over all of which Mr.
Williamson has sole voting and dispositive power), including 10,000 shares
of Series A Common Stock which he may acquire upon the exercise of
outstanding stock options and 2,257 stock units deferred under The Times
Mirror Non-Employee Directors Stock Plan. On March 9, 1998, the individuals
who act as trustees of the Chandler Trusts beneficially owned, directly or
indirectly, in their capacities as individuals and as trustees of the
Chandler and other trusts an aggregate of 9,536,674 shares of Series A
Common Stock and 20,773,889 shares of Series C Common Stock constituting
15.11% of the shares of Series A Common Stock and 81.56% of the shares of
Series C Common Stock outstanding on that date, representing 68.36% of the
total voting interests of all outstanding shares of Series A and Series C
Common Stock. Unless otherwise indicated, all beneficial ownership figures
reported in this footnote represent shares over which the beneficial owner
shares voting and dispositive power with others.
(3) Based on holdings as of December 31, 1997. Shares of Times Mirror stock
allocated to participants' accounts in The Times Mirror Employee Stock
Ownership Plan ("ESOP") are voted by the participants themselves on
matters presented at meetings of shareholders. Shares with respect to
which no participant directions are received are voted by the trustee of
the ESOP as directed by the Plan Administration Committee, which is
appointed by the Board of Directors of the Company. Fidelity Management
Trust Company will replace The Northern Trust Company as trustee of the
Times Mirror Savings Plus Plan on April 1, 1998. This Committee also has
authority and responsibility for the disposition of the investment of the
assets held in the ESOP, including the stock. This Committee consists of
five officers of the Company, three of whom are Mark H. Willes, Thomas
Unterman and Donald F. Wright.
(4) Based on holdings as of December 31, 1997. Shares of Times Mirror stock
held in the Times Mirror Savings Plus Plan accounts or allocated to
participants' Payroll-Based Stock Ownership Plan ("PAYSOP") accounts are
voted by the participants themselves on matters presented at meetings of
shareholders. Shares allocated to the Times Mirror Savings Plus Plan
accounts with respect to which no participant directions are received will
remain unvoted. Shares allocated to the PAYSOP accounts with respect to
which no participant directions are received will be voted by Fidelity
Management Trust Company, as trustee of the Times Mirror Savings Plus
Plan.
(5) This information is based solely on a Schedule 13G dated February 14, 1998
filed with the Securities and Exchange Commission (the "SEC") by FMR Corp.
as a parent holding company on behalf of certain shareholders of FMR Corp.
and its investment advisory subsidiary Fidelity Management & Research
Company ("Fidelity"). Fidelity is the beneficial owner of 6,951,797 shares
of the Series A Common Stock as a result of acting as investment advisor
to various registered investment companies and as sub-advisor to a unit
trust. Fidelity Management Trust Company, a subsidiary of FMR Corp., is
the beneficial owner of 2,885,116 shares of the Series A Common Stock as a
result of it serving as investment manager of institutional accounts.
Fidelity International Limited, a company partially owned indirectly by
certain shareholders of FMR Corp., is the beneficial owner of 20,900
shares of Series A Common Stock. FMR Corp. has sole power to vote
2,742,216 shares and sole power to dispose of 9,856,113 shares. See Note
(4) above.
(6) This information is based solely on a Schedule 13G dated March 6, 1998
filed with the SEC on March 9, 1998 by Soros Fund Management LLC ("SFM"),
George Soros, Stanley F. Druckenmiller and Duquesne Capital Management,
L.L.C. ("DCM"). SFM, as principal investment manager, may be deemed to be
the
10
<PAGE>
beneficial owner of 5,347,000 shares (over all of which it reports having
sole dispositive and voting power) held for the account of Quantum Partners
LDC ("Quantum"). Mr. Soros, as Chairman of SFM, may be deemed to be the
beneficial owner of 5,347,000 shares (over all of which he reports having
shared dispositive and voting power) held for the account of Quantum and,
as a general partner, may be deemed to be the beneficial owner of 262,000
shares (over all of which he reports having sole dispositive and voting
power) held for the account of Lupa Family Partners ("Lupa"). Mr.
Druckenmiller, as Lead Portfolio Manager and a member of the management
committee of SFM, may be deemed to be the beneficial owner of 5,347,000
shares (over all of which he reports having shared dispositive and voting
power) held for the account of Quantum and, as an investor in and sole
managing member of DCM, may be deemed to be the beneficial owner of 918,700
shares (over all of which he reports having sole dispositive and voting
power) held for the accounts of institutional clients of DCM. DCM, as
discretionary investment advisor, may be deemed to be the beneficial owner
of 918,700 shares (over all of which it reports having sole dispositive and
voting power) held for the accounts of institutional clients. SFM disclaims
beneficial ownership of any shares held for the accounts of Lupa and the
clients of DCM. Mr. Soros disclaims beneficial ownership of any shares held
for the accounts of the clients of DCM. Mr. Druckenmiller disclaims
beneficial ownership of any shares held for the account of Lupa. DCM
disclaims beneficial ownership of any shares held for the accounts of
Quantum and Lupa.
(7) This information is based solely on a Schedule 13G filed with the SEC on
January 21, 1998 by Putnam Investments, Inc. ("PI"). PI, a wholly owned
subsidiary of Marsh & McLennan Companies, Inc., wholly owns Putnam
Investment Management, Inc. ("PIM"), which is the investment adviser to
the Putnam family of mutual funds, and The Putnam Advisory Company, Inc.
("TPAC"), which is the investment adviser to Putnam's institutional
clients. PIM and TPAC both have dispositive power over the shares as
investment managers, but each of the mutual fund's trustees have voting
power over the shares held by each fund, and TPAC has shared voting power
over the shares held by the institutional clients.
BENEFICIAL OWNERSHIP OF MANAGEMENT
The following table shows the beneficial ownership as of March 9, 1998 of
the Company's common and preferred stock, including shares as to which a right
to acquire ownership exists within the meaning of Rule 13d-3(d)(1) under the
Securities Exchange Act of 1934, of each director, each nominee, each
executive officer listed in the Summary Compensation Table on page 13, and a
group of such persons and other executive officers. For this purpose, the
rules of the Securities and Exchange Commission require that every person who
has or shares the power to vote or dispose of shares of stock be reported as a
"beneficial owner" of all shares as to which such power exists. As a
consequence, many persons may be deemed to be the "beneficial owners" of the
same securities and for this reason all shares of Series A Common Stock,
Series C Common Stock, Series C-1 Preferred Stock and Series C-2 Preferred
Stock held by the trustees of the Chandler Trusts (see Note (2) on page 9) are
included in the shares reported in the table below as "beneficially owned" by
each director who is also a trustee of the Chandler Trusts. None of the
persons listed below beneficially owns any shares of the Company's Cumulative
Redeemable Preferred Stock, Series A. Unless otherwise indicated, beneficial
ownership numbers represent shares over which the beneficial owner has sole
voting and dispositive power.
11
<PAGE>
TABLE OF BENEFICIAL OWNERSHIP OF MANAGEMENT
<TABLE>
<CAPTION>
SERIES A SERIES C SERIES C-1 SERIES C-2
COMMON STOCK COMMON STOCK PREFERRED STOCK PREFERRED STOCK
---------------------------- ------------------------ ------------------ ------------------
PERCENT PERCENT PERCENT PERCENT
OF OF OF OF
NAME TOTAL(1)(2) SERIES TOTAL(1) SERIES TOTAL SERIES TOTAL SERIES
---- ----------- ------- ---------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Gwendolyn Garland
Babcock................ 9,322,971(3)(4)(5) 14.77% 20,769,906(4)(5) 81.54% 380,972(4) 100% 245,100(4) 100%
Donald R. Beall......... 13,258(3)(5) * -- -- -- -- -- --
Horst A. Bergmann....... 74,133(7) * -- -- -- -- -- --
John E. Bryson.......... 15,410(3) * -- -- -- -- -- --
Bruce Chandler.......... 9,316,872(4) 14.76% 20,757,246(4) 81.49% 380,972(4) 100% 245,100(4) 100%
Otis Chandler........... 9,318,594(4)(5) 14.76% 20,761,229(4)(5) 81.51% 380,972(4) 100% 245,100(4) 100%
Robert F. Erburu........ 682,216(3) 1.07% 57,513 * -- -- -- --
Clayton W. Frye, Jr..... 17,333 * 190 * -- -- -- --
Mary E. Junck........... 18,309(7) * -- -- -- -- -- --
David Laventhol......... 34,565 * 24,533 * -- -- -- --
Dr. Alfred E. Osborne,
Jr..................... 13,459(3) * 385 * -- -- -- --
Joan A. Payden.......... 12,243 * -- -- -- -- -- --
William Stinehart, Jr... 9,318,382(3)(4)(5) 14.76% 20,757,246(4) 81.49% 380,972(4) 100% 245,100(4) 100%
Thomas Unterman......... 164,997(7) * -- -- -- -- -- --
Mark H. Willes.......... 336,038(7) * -- -- -- -- -- --
Harold M. Williams...... 11,603 * 200 * -- -- -- --
Warren B. Williamson.... 9,318,164(3)(4) 14.76% 20,757,246(4) 81.49% 380,972(4) 100% 245,100(4) 100%
Donald F. Wright........ 187,476(5)(7) * 54,932(6) * -- -- -- --
Dr. Edward Zapanta...... 14,671(3)(8) * -- -- -- -- -- --
All directors and
executive officers as a
group
(26 persons, including
those named above)..... 11,026,592 17.11% 20,923,840 82.14% 380,972(4) 100% 245,100(4) 100%
</TABLE>
- -------
* Less than 1%
(1) Includes shares held under the Company's Savings Plus Plan (including the
PAYSOP) and Employee Stock Ownership Plan and allocated to the accounts of
the executive officers as of December 31, 1997. Also includes shares held
in the Company's Dividend Reinvestment Plan.
(2) Includes shares which may be acquired upon the exercise of outstanding
stock options and that are currently exercisable within 60 days of March
9, 1998 as follows: 10,000 by Mrs. Babcock; 10,000 by Mr. Beall; 64,792 by
Mr. Bergmann; 13,653 by Mr. Bryson; 10,000 by Mr. Bruce Chandler; 11,410
by Mr. Otis Chandler; 594,628 by Mr. Erburu; 10,000 by Mr. Frye; 7,500 by
Ms. Junck; 10,000 by Dr. Osborne; 10,000 by Ms. Payden; 10,000 by Mr.
Stinehart; 133,747 by Mr. Unterman; 248,100 by Mr. Willes; 10,000 by Mr.
Williams; 10,000 by Mr. Williamson; 157,927 by Mr. Wright; and 10,000 by
Dr. Zapanta.
(3) Includes shares deferred under The Times Mirror Company Non-Employee
Directors Stock Plan.
(4) Includes shares held in the Chandler Trusts, as to which Mr. Stinehart
disclaims beneficial ownership. See Note (2) on page 9.
(5) Includes shares held in trust, or other capacities, as to which beneficial
ownership is disclaimed. Mr. Beall shares dispositive and voting power
with respect to 1,243 shares and Mr. Wright shares dispositive and voting
power with respect to 400 shares. See Note (2) on page 9 for dispositive
and voting power of other persons indicated.
(6) Includes shares held by the Pfaffinger Foundation as to which Mr. Wright
shares dispositive and voting power and disclaims beneficial ownership. As
of March 9, 1998, the Pfaffinger Foundation held 50,000 shares of Series C
Common Stock.
(7) Includes shares of restricted stock, including shares granted under the
matching restricted stock program of The Times Mirror Company 1996
Management Incentive Plan.
(8) Includes shares held in an Individual Retirement Account.
12
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information with respect to compensation of
the chief executive officer of the Company and each of the four most highly
compensated executive officers of the Company (other than the chief executive
officer) serving in such capacity at December 31, 1997. This table includes
information for each individual for services in all capacities to the Company
for the fiscal years ended December 31, 1997, 1996 and 1995, unless otherwise
noted.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------ --------------------- -------
SECURITIES
RESTRICTED UNDERLYING
OTHER ANNUAL STOCK STOCK LTIP ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARDS OPTIONS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($)(1) ($)(2) ($)(3) (#)(4) ($)(5) ($)(6)
------------------ ---- ------- --------- ------------ ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Mark H. Willes 1997 905,770 1,968,750 9,700 494,606 200,000 -- 66,852
Chairman of the 1996 798,076 1,350,000 2,900 338,859 180,200 745,084 101,503
Board, President and 1995 409,616 525,000 -- 595,000 108,000 -- 1,085,613(7)
Chief Executive
Officer, and Publisher,
Los Angeles Times
Thomas Unterman 1997 517,308 506,250 -- 127,179 65,000 -- 4,750
Executive Vice
President 1996 450,000 405,000 -- 101,672 50,700 378,751 4,500
and Chief Financial 1995 413,019 250,000 -- -- 29,615 160,800 4,500
Officer
Donald F. Wright 1997 452,116 407,157 2,644 102,338 40,000 -- 4,750
Executive Vice
President, 1996 404,999 360,000 1,612 90,375 42,800 416,005 44,974
and President and Chief 1995 404,230 150,000 -- -- 31,385 214,400 4,500
Executive Officer,
Los Angeles Times
Mary E. Junck 1997 369,807 358,064 9,000 89,976 30,000 -- 4,750
Executive Vice
President, 1996 330,000 315,000 9,000 206,390 57,100 266,988 4,500
and President, Eastern 1995 330,000 80,000 9,000 -- 20,637 -- 4,500
Newspapers
Horst A. Bergmann 1997 369,617 354,375 9,000 89,043 30,000 -- 4,750
Executive Vice
President, 1996 289,519 157,500 9,000 39,562 47,600 192,480 4,500
and Chairman, President
and 1995 284,486 100,000 -- -- 14,382 111,735 4,500
Chief Executive
Officer,
Jeppesen Sanderson
and AchieveGlobal
</TABLE>
- -------
(1) An officer may elect to take his or her bonus award in the form of cash or
deferred cash. Beginning with 1996 bonuses, an officer may also elect to
take 25% of such bonus award in shares of Series A Common Stock.
(2) Represents amounts paid in cash as allowances for certain perquisites or
to reimburse the named officers for the tax impact of certain perquisites.
None of the named executive officers received perquisites or other
personal benefits in an amount sufficient to require inclusion in this
column.
(3) Restricted stock grants relate to the Company's Series A Common Stock.
Dollar amounts shown in this column equal the number of shares of
restricted stock awarded multiplied by the closing market price of the
Company's Series A Common Stock on the grant date, net of any
consideration paid. The restricted shares granted for special restricted
stock awards vest 25% commencing on the second anniversary of the date of
award and 25% on each successive anniversary of the award date. Mr.
Willes' grant in 1995 and a special promotional grant in 1996 to Ms. Junck
of 3,500 shares were special restricted stock awards. Under the Company's
matching bonus restricted stock program under The Times Mirror Company
1996 Management Incentive Plan, certain officers of the
13
<PAGE>
Company can elect to place shares of Series A Common Stock on deposit with
the Company in an amount equal to 25% of their bonus, which the Company
then matches with the same number of restricted shares. The restricted
shares granted on January 30, 1997 for 1996 compensation and on February 5,
1998 for 1997 compensation under the matching restricted stock program will
vest 100% after four years, provided that the officer does not terminate
employment with the Company prior to that time or withdraw the shares
deposited with the Company for the match. Regular dividends are paid on
restricted shares. As of December 31, 1997, the number and value of
restricted stock award holdings, which do not include the restricted shares
granted on February 5, 1998 for 1997 compensation, were as follows: 33,479
($2,058,958) for Mr. Willes, 20,919 ($1,286,518) for Mr. Unterman, 1,928
($118,572) for Mr. Wright, 5,187 ($319,000) for Ms. Junck and 844 ($51,906)
for Mr. Bergmann.
(4) Securities reported in the Summary Compensation Table above for the year
1996 were granted on December 7, 1995, but related to compensation for
1996 and are therefore reported as 1996 compensation. Except for stock
options granted to Mr. Willes, the securities reported in the Summary
Compensation Table above for the year 1995 were granted on November 30,
1994, but related to compensation for 1995 and are therefore reported as
1995 compensation. This reporting approach has been taken to tie the
grants to the compensation period to which they relate rather than to the
date of the Board or committee meeting at which the grants were made.
Securities reported for Mr. Willes for 1995 relate to the grant of stock
options to him when he joined the Company. Securities for Ms. Junck and
Mr. Bergmann for 1996 also include a special promotional stock option
grant for 25,000 shares. Securities reported for Mr. Unterman for 1997
also include a special performance award of 15,000 stock options.
(5) In 1996, deferred cash incentive awards which had previously been granted
under the Company's 1992 Key Employee Long-Term Incentive Plan were
canceled, and shares of the Company's Series A Common Stock with certain
restrictions on transfer were granted in the place of such awards. Amounts
reported for 1996 include the value of the shares and an amount equal to
dividends paid during the first quarter of 1996 on such shares. Amounts
reported for 1995 represent payouts earned for performance under the prior
deferred cash incentive program.
(6) The amounts shown in this column for 1997 consist of the following: (i)
Mr. Willes, $62,102 for relocation assistance (see page 22) and $4,750 for
matching Company contributions under the Times Mirror Savings Plus Plan;
and (ii) Messrs. Unterman, Wright and Bergmann and Ms. Junck, $4,750 for
matching Company contributions under the Times Mirror Savings Plus Plan.
The amounts shown in this column for 1996 consist of the following:
(i) Mr. Willes, $97,003 for relocation assistance (see page 22), and
$4,500 for matching Company contributions under the Times Mirror Savings
Plus Plan; (ii) Messrs. Unterman and Bergmann and Ms. Junck, $4,500 for
matching Company contributions under the Times Mirror Savings Plus Plan;
and (iii) Mr. Wright, $40,474 for a payout for accrued vacation and $4,500
for matching Company contributions under the Times Mirror Savings Plus
Plan.
(7) Mr. Willes received 25,000 shares of Series A Common Stock in February
1996 (having a market value of $871,875 at that time) in lieu of cash for
a housing differential allowance and $213,738 in 1995 for relocation
assistance, resulting from his relocation in 1995 to Los Angeles (see page
22). These amounts were reported as bonus and as Other Annual
Compensation, respectively, in the Company's 1995 proxy statement.
14
<PAGE>
OPTION GRANTS TABLE
The following table sets forth all grants of stock options for 1997 to the
named executive officers of the Company under the Company's 1996 Management
Incentive Plan.
OPTION GRANTS FOR FISCAL YEAR 1997
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- --------------------------------------------------------------------------------
NUMBER OF % OF
SECURITIES TOTAL
UNDERLYING OPTIONS EXERCISE
OPTIONS GRANTED TO OR BASE GRANT DATE
GRANTED EMPLOYEES PRICE EXPIRATION PRESENT
NAME (#)(1) FOR 1997 ($/SH) DATE VALUE$(2)
- ---- ---------- ---------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Mark H. Willes............. 200,000 4.3% 46.6875 1/30/2007 $2,344,000
Thomas Unterman............ 65,000 1.4% 46.6875 1/30/2007 761,800
Donald F. Wright........... 40,000 0.9% 46.6875 1/30/2007 468,800
Mary E. Junck.............. 30,000 0.7% 46.6875 1/30/2007 351,600
Horst A. Bergmann.......... 30,000 0.7% 46.6875 1/30/2007 351,600
</TABLE>
- --------
(1) These options were granted at fair market value on January 30, 1997 and
related to compensation for 1997. These options were granted under the
Company's 1996 Management Incentive Plan ("MIP"), have a ten-year term and
may be initially exercised as to 25% of the underlying shares on the first
anniversary of the grant date, an additional 25% becoming exercisable on
each successive anniversary date, with full vesting on the fourth
anniversary date. Upon a change in control as described under the MIP, any
previously unexercisable portion of the options becomes exercisable.
(2) Present value determinations were made using the Black-Scholes option
pricing model. There is no assurance that any value realized by optionees
will be at or near the value estimated by that model. The ultimate values
of the options will depend on the future market price of the Series A
Common Stock, which cannot be forecast with reasonable accuracy. The
actual value, if any, an optionee will realize upon exercise of an option
will depend upon the excess, if any, of the market value of the Series A
Common Stock on the date the option is exercised over the exercise price
of the option. The model assumes (a) volatility of 0.22 derived by
averaging the weekly historical volatility of the Company over the 52 week
period prior to January 30, 1997 (the "Measurement Period"); (b) a risk-
free rate of return based on the rate (6.30%) available on the grant date
on zero-coupon U.S. Government issues with a remaining term equal to the
expected life of the options (5 years); and (c) a dividend yield of 2.33%
derived by taking the Company's target payout ratio divided by the
Company's static price to earnings ratio. The options vest at a rate of
25% per year over a 4 year period commencing on the first anniversary of
the grant date. The Black-Scholes ratio was applied to the average of the
closing prices for the most recent 20 trading days ending January 30,
1997.
15
<PAGE>
AGGREGATED OPTION EXERCISES IN 1997 AND OPTION VALUES AS OF DECEMBER 31, 1997
The following table sets forth certain information with respect to exercises
by the named executive officers of stock options during 1997, the number of
securities underlying unexercised options held by the named executive officers
at December 31, 1997 and the value of unexercised in-the-money options as of
December 31, 1997.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AS OF IN-THE-MONEY OPTIONS
DECEMBER 31, 1997 AS OF DECEMBER 31, 1997(1)
------------------------- ----------------------------
SHARES ACQUIRED VALUE
NAME ON EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- --------------- ------------ ----------- ------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Mark H. Willes.......... -- -- 90,100 398,100 $2,477,750 $10,131,500
Thomas Unterman......... -- -- 87,882 119,965 3,379,797 2,945,228
Donald F. Wright........ -- -- 116,542 92,785 4,575,886 2,543,109
Mary E. Junck........... 25,896 $701,047 14,275 85,437 346,078 2,157,567
Horst A. Bergmann....... -- -- 42,910 74,432 1,488,495 1,755,475
</TABLE>
- --------
(1) Represents the difference between the closing price of the Company's
Series A Common Stock on December 31, 1997 ($61.50) and the option price
on the date of grant.
16
<PAGE>
The following material is not deemed to be part of a document filed with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended, and is not to be deemed to be incorporated by reference in
any documents filed under the Securities Act of 1933, as amended, without the
express consent of the persons named below.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
Committee Charter
Prior to 1998, the Board of Directors of The Times Mirror Company (the
"Company") delegated to the Compensation Committee (the "Committee") the
authority to review, consider and determine the compensation of the Company's
executive officers. In February 1998, the Compensation Committee delegated to
the Executive Compensation Subcommittee of the Compensation Committee the
authority to review, consider and determine the compensation of the Company's
executive officers. The Compensation Committee was first established in 1962
and its activities have included the review and development of executive
compensation programs and the award of incentive payments under those
programs. The names of the Committee's members appear below. None of the
members of the Committee is employed by the Company and none is employed by
companies whose boards of directors include an officer of the Company.
Compensation Policies
The Committee's policies are designed to assist the Company in attracting,
retaining and motivating qualified executives by providing competitive levels
of compensation that align directly shareholders' and executives' financial
interests, reward achievement of the Company's annual and long-term
performance goals, and recognize individual initiative and achievements. As a
result of extensive consideration in 1995 of the Company's compensation
policies, the Committee implemented a performance-based compensation program
involving annual bonus incentive awards contingent on satisfaction of pre-
established performance goals selected by the Committee under the 1996
Management Incentive Plan ("Incentive Plan"), approved by shareholders in
1996, and on individual performance and stock-based arrangements. The
Incentive Plan implements the Committee's approach of providing total
compensation which is leveraged based upon individual, corporate and business
unit performance.
The specific objectives of the executive compensation program are to (a)
link directly shareholder and executive interests; (b) balance rewards for
achieving short-term and long-term performance objectives (financial and
strategic); (c) ensure that total compensation costs vary in direct
correlation with the Company's financial results; and (d) encourage executives
to acquire and retain Company stock. In December 1995, the Committee adopted
stock ownership guidelines for the Company's senior key executives to further
align their interests with those of shareholders. The guidelines suggest
minimum stock ownership thresholds, excluding unexercised stock options, for
executives depending on their positions, and range from a minimum of at least
one year's base salary for vice presidents of the Company and chief executive
officers and selected key executives of the Company's various business units
to four years' base salary for the Chairman, President and Chief Executive
Officer of the Company. The Company expects that executives will reach full
compliance with these guidelines over several years, and many executives have
already done so.
For 1997, executives' total compensation packages typically consisted of
salary, an annual bonus incentive award and stock option grants. The
allocation of types of compensation varied depending on level, position and
function, with more senior executives having a greater portion of their
compensation packages tied to performance achievements. Based on a regular
review of survey data of other companies of comparable size, complexity and
industry focus provided by independent, nationally recognized compensation
consulting firms, the Committee generally set executives' base salaries at
median levels, executives' bonus incentive targets slightly above the median
and stock option grants at levels consistent with the prior year's grant. The
compensation survey data reviewed by the Committee includes information on pay
levels for companies within the media/communications industry against which
the Company may compete in whole or in part for business or talent.
17
<PAGE>
The amount of annual bonus incentive awards for 1997 was determined by
reference to pre-established financial performance goals, notably the
Company's actual 1997 financial results which significantly exceeded the 1997
targets for return on capital, net income and earnings per share. In addition
to weighing annual performance, the Committee considered favorably the
strategic actions taken in 1997 to restart growth in the Company's newspapers
and to reevaluate the Company's position in legal and medical publishing. The
Committee also found particularly noteworthy the Company's recapitalization
transaction with the Chandler Trust in August 1997 which balanced the
interests of the Company and the Trusts in a manner that measurably created
shareholder value.
Compensation of Mark H. Willes, the Chief Executive Officer
Mr. Willes' compensation, and that of other Company executives, was
determined on a leveraged basis that was heavily weighted toward performance
to align executives' interests with those of the shareholders. The Committee's
consideration in setting the 1997 compensation of Mr. Willes was strongly
influenced by the improvement in return on capital and earnings per share
experienced by the Company during 1996 and by the Company's achievement of
certain strategic initiatives during 1996. In January 1997, the Committee set
Mr. Willes' base compensation for 1997 at $875,000. In January 1998, the
Committee awarded Mr. Willes a bonus of $1,968,750 with respect to 1997
performance. In 1997, the Committee granted him options on 200,000 shares of
Series A Common Stock with an exercise price of $46.6875 (the stock's market
price on the date of grant) as part of his compensation for 1997. In taking
such actions, the Committee also considered Mr. Willes' success in the
continued revitalization of the Company and in incenting its executives to
achieve significant internal growth.
Company Policy Regarding Section 162(m) of the Internal Revenue Code
Under the 1993 Omnibus Budget Reconciliation Act ("OBRA"), income tax
deductions for compensation paid by publicly-traded companies may be limited
to the extent total compensation (including base salary, annual bonus,
restricted stock vesting, stock option exercises and non-qualified benefits)
for certain executive officers exceeds $1 million in any one year. Under OBRA,
the deduction limit does not apply to payments which qualify as "performance-
based." To qualify as "performance-based," compensation payments must be made
from a plan that is administered by a committee of outside directors. In
addition, the material terms of the plan must be disclosed to and approved by
shareholders, and the committee must certify that the performance goals were
achieved before payments can be awarded.
The Committee intends generally to design the Company's compensation
programs to conform with the OBRA legislation and related regulations so that
total non-qualifying compensation paid to any employee will not exceed $1
million in any one year, except for compensation payments in excess of $1
million which qualify as "performance-based." The Incentive Plan is designed
so that option grants and all or a portion of restricted stock grants and
annual incentive bonuses paid under the Incentive Plan may be qualified as
"performance-based." However, the Company may pay compensation which is not
deductible in limited circumstances when sound management of the Company so
requires.
CLAYTON W. FRYE, JR., CHAIRMAN DR. ALFRED E. OSBORNE, JR.
DONALD R. BEALL WARREN B. WILLIAMSON
JOHN E. BRYSON DR. EDWARD ZAPANTA
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1997, Messrs. Frye, Beall, Bryson and Williamson and Drs. Zapanta and
Osborne served on the Compensation Committee. As described in Certain
Relationships and Related Transactions on page 21, Mr. Williamson is a trustee
and a beneficiary of the Chandler Trusts, which in August 1997 consummated a
recapitalization transaction with the Company.
18
<PAGE>
STOCK PRICE PERFORMANCE GRAPH
The stock price performance graph depicted below shall not be deemed
incorporated by reference by any general statement incorporating by reference
this proxy statement into any filing under the Securities Act of 1933 or under
the Securities Exchange Act of 1934, except to the extent that the Company
specifically incorporates this information by reference, and shall not
otherwise be deemed filed under such Acts.
The graph below compares the cumulative total return of Times Mirror, the S&P
500 Stock Index and the following group of peer companies (the "Peer Group"):
A. H. Belo Corporation, Dow Jones & Company, Inc., The E. W. Scripps Company,
Gannett Co., Inc., Knight-Ridder, Inc., McClatchy Newspapers, Inc., The McGraw
Hill Companies, Inc., Media General, Inc., Meredith Corporation, The New York
Times Company, Tribune Company and The Washington Post Company.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN(1)
OF TIMES MIRROR, S&P 500 INDEX AND PEER GROUP
PERFORMANCE GRAPH APPEARS HERE
<TABLE>
<CAPTION>
Measurement Period TIMES S&P PEER
(Fiscal Year Covered) MIRROR(2) 500 INDEX GROUP(3)
- --------------------- --------- --------- --------
<S> <C> <C> <C>
Measurement Pt- 12/31/92 $100 $100 $100
FYE 12/31/93 $111 $110 $116
FYE 12/31/94 $107 $112 $113
FYE 12/31/95 $173 $153 $141
FYE 12/31/96 $256 $189 $170
FYE 12/31/97 $319 $252 $267
</TABLE>
- --------
(1) Assumes $100 invested on December 31, 1992 in the common stock of Times
Mirror, the S&P 500 Index and the common stock of the Peer Group. Total
shareholder return assumes full reinvestment of dividends and other
distributions.
(2) The above graph reflects distributions received in connection with the
divestiture of the Company's cable operations as a dividend in 1995. Such
dividend is assumed to have been reinvested in the Company's common stock
as of the date of such divestiture.
(3) Peer Group data is weighted by market capitalization as of the beginning of
each year.
19
<PAGE>
RETIREMENT PLANS
The following table illustrates the maximum annual benefits payable as a
single life annuity under the basic benefit formula in the Pension Plan (see
below) to an officer or employee retiring at age 65 with the specified
combination of final average salary and years of credited service.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF CREDITED SERVICE AT RETIREMENT
FINAL AVERAGE ---------------------------------------
SALARY (5 YEARS) 15 20 25 30
---------------- --------- --------- --------- ---------
<S> <C> <C> <C> <C>
$ 300,000........................ $ 78,750 $ 105,000 $ 131,250 $ 157,500
400,000........................ 105,000 140,000 175,000 210,000
500,000........................ 131,250 175,000 218,750 262,500
600,000........................ 157,500 210,000 262,500 315,000
700,000........................ 183,750 245,000 306,250 367,500
800,000........................ 210,000 280,000 350,000 420,000
900,000........................ 236,250 315,000 393,750 472,500
1,000,000........................ 262,500 350,000 437,500 525,000
1,100,000........................ 288,750 385,000 481,250 577,500
1,200,000........................ 315,000 420,000 525,000 630,000
</TABLE>
The Company maintains a retirement income plan (the "Pension Plan") which is
a funded, qualified, non-contributory, defined benefit plan that covers most
employees including executive officers. The Pension Plan provides benefits
based on the participant's highest average salary for five consecutive years
within the ten years prior to retirement and the participant's length of
service. Benefit amounts will be offset by a portion of the primary Social
Security benefit to be received by the participant. A survivor's annuity for
the spouse of a vested participant is also provided.
In general, compensation covered by the Pension Plan includes salary and
wages, but does not include bonuses, overtime pay, or other unusual or
extraordinary compensation. For the executive officers whose compensation is
shown in the Summary Compensation Table on page 13, up to $160,000 paid in
1997 and designated as salary in that table is covered by the Pension Plan.
Credited years of service under the Pension Plan as of December 31, 1997 were
approximately 2 years for Mr. Willes, 5 years for Mr. Unterman, 20 years for
Mr. Wright, 4 years for Ms. Junck and 34 years for Mr. Bergmann.
The amounts shown in the Pension Plan Table above have been calculated
without adjustment for Social Security benefits, and thus may be subject to
reduction to recognize primary Social Security benefits to be received by the
participant. The amounts shown in the Table above have also been calculated
without reference to the maximum limitations ($125,000 in 1997) imposed by the
Internal Revenue Code on benefits which may be paid under a qualified defined
benefit plan. Optional forms of payment available under the Pension Plan may
result in substantially reduced payments to an employee electing such an
option.
In addition to the amounts shown in the above Pension Plan Table, certain
active participants employed on March 29, 1985 were eligible for a past
service benefit improvement as a single sum equal to 2% of their 1984 base
salary (for participants in the Supplemental Executive Retirement Plan (the
"SERP"), 2% of their aggregated 1984 base salary and 1984 annual bonus)
multiplied by the years of credited service before 1985. This amount will be
increased by an amount equal to interest, currently at 7 1/2% per annum, until
termination or retirement and then may be paid as a single sum or converted
into an equivalent annuity commencing at retirement. The estimated annual past
service improvement benefit from the Pension Plan and the SERP for the
officers named in the Summary Compensation Table on page 13 and employed by
the Company on March 29, 1985 is $12,972 for Mr. Wright.
The Company also maintains an Employee Stock Ownership Plan (the "ESOP").
Benefits provided by the ESOP are coordinated with benefits provided under the
Pension Plan so that benefits payable under the ESOP
20
<PAGE>
will be offset against benefits otherwise payable under the Pension Plan.
Effective January 1, 1995, the Company discontinued its contributions to the
ESOP for plan years after 1994. Certain officers of the Company were eligible
to participate in the ESOP and, subject to applicable limitations imposed by
the Internal Revenue Code and by the Employee Retirement Income Security Act
of 1974 ("ERISA"), will be entitled to receive shares which have been
allocated to their accounts and other benefits provided by the ESOP. Estimated
individual account balances of Series A and Series C Common Stock (aggregated
for each individual) as of December 31, 1997 were as follows: 701 shares for
Mr. Unterman and 5,655 shares for Mr. Wright.
The Company also maintains the SERP to provide retirement benefits for
certain officers of the Company designated by the Compensation Committee of
the Board of Directors. Participants in the SERP will be entitled to receive
vested benefits under the SERP in addition to benefits payable under all other
employee benefit plans. Of the named officers on page 13, the Compensation
Committee has designated Messrs. Willes, Unterman, Wright and Bergmann and Ms.
Junck as participants in the SERP.
Benefits payable under the SERP will be determined in substantially the same
manner as under the Pension Plan except that (a) covered compensation includes
both base salary and awards under the bonus-incentive program, and (b) the
amount payable will be calculated without regard to the provisions of Section
415 of the Internal Revenue Code or other legal limits on benefits under a
qualified pension plan. The SERP provides that each participant will receive
benefits under the SERP at least equal to the difference between the amount he
or she would have been entitled to receive without regard to the maximum
limitations imposed by the Internal Revenue Code and the amount such
participant is entitled to receive under the Pension Plan. If a married
participant dies, his or her spouse will be entitled to receive a lifetime
annuity equal to approximately one-half the amount the participating officer
would have been entitled to receive under the SERP as of the date of the
participant's death.
The SERP is unfunded. Participants become vested under the same schedule as
in the Pension Plan or upon a change in control and each such participant will
be entitled to receive his or her benefits under the SERP commencing upon
retirement, provided that any such benefit commencing prior to age 65 will be
actuarially reduced to reflect its commencement prior to age 65.
The Company has established an ERISA excess retirement plan (the "Excess
Plan") to provide pension benefits for certain employees including officers of
the Company but excluding participants in the SERP. The Excess Plan provides
that each participant will receive benefits under the Excess Plan equal to the
difference between the amount he or she would have been entitled to receive
without regard to the maximum limitations imposed by the Internal Revenue Code
and the amount such participant is entitled to receive under the Pension Plan.
Participants will be vested under the Excess Plan under the same vesting
provisions as the Pension Plan. The Excess Plan is unfunded.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Four of the Company's present directors (Gwendolyn Garland Babcock, Bruce
Chandler, Otis Chandler and Warren B. Williamson) are cousins. Gwendolyn
Garland Babcock, Bruce Chandler, Camilla Chandler Frost, Douglas Goodan,
William Stinehart, Jr., Judy C. Webb and Warren B. Williamson are the trustees
of two trusts known as the "Chandler Trusts." Camilla Chandler Frost is the
sister of Otis Chandler and a cousin of the other directors named above (other
than Mr. Stinehart). Douglas Goodan and Judy C. Webb are also cousins of each
of the directors named above (other than Mr. Stinehart). The trustees (other
than Mr. Stinehart) and other of their relatives are beneficiaries of the
Chandler Trusts. The Chandler Trusts, their trustees and the general family
group of which they are members may be deemed to be "parents" of the Company
within the meaning of the Securities Act of 1933, as amended.
In August 1997, the Company and the Chandler Trusts consummated a
transaction that consisted of two parts. First, the Company and the Chandler
Trusts made contributions of assets to a new limited liability company.
Second, Chandis Securities Company, a company principally owned by one of the
Chandler Trusts, was merged into a subsidiary of the Company.
21
<PAGE>
In forming the new limited liability company, the Company contributed real
property having an appraised value of $226 million and $249 million in cash.
The Chandler Trusts contributed approximately 5 million shares of Series A
Common Stock, valued at $254 million, and $221 million stated value of 8%
Series A Preferred Stock. The real property was leased back to the Company
under long-term leases and the cash was invested in a portfolio of securities
of unrelated issuers. Pursuant to the allocations of the limited liability
company, approximately $7,683,000 of the lease payments and $1,033,000 of
dividends received by the limited liability company in 1997 were allocated to
the Chandler Trusts.
As a result of the merger, a subsidiary of the Company became the owner of
all of Chandis Securities' assets, including approximately 8.6 million shares
of Series A Common Stock, approximately 9.7 million shares of Series C Common
Stock, approximately $190 million stated value of 8% Series A Preferred Stock
and $21 million of real estate, cash and other miscellaneous net assets. In
the merger, the Chandis Securities shareholders received, in exchange for all
the outstanding shares of Chandis Securities, 6.6 million shares of Series A
Common Stock, 9.7 million shares of Series C Common Stock and an aggregate of
$313 million stated value of newly authorized preferred stock. The annual
dividend rate of the preferred stock is 5.8% through December 31, 2000 and is
subject to possible upward adjustment thereafter in the same proportion as the
percentage increase in the Company's annual common stock dividend rate, to a
maximum dividend rate of 8.4%.
The Company has an agreement with Mr. Otis Chandler, a director of the
Company and its former Chairman and Editor-in-Chief and Publisher of the Los
Angeles Times, under which he is entitled to receive supplemental payments
from the Company sufficient to provide an aggregate of $300,000 each year from
(i) payments made to or for Mr. Chandler's account under the Company's Pension
Plan and ESOP, and (ii) supplemental payments to be made by the Company. That
agreement also provides for payment of supplemental benefits to Mr. Chandler's
widow following his death sufficient to provide her, from her survivor's
annuity under the Company's Pension Plan and a supplemental benefit from the
Company, an aggregate of one-half of the amount Mr. Chandler is entitled to
receive. Mr. and Mrs. Chandler are also entitled to continuation of life
insurance on Mr. Chandler's life and medical and dental coverage provided for
certain retired officers.
Mr. Robert F. Erburu, a director of the Company and its former Chairman,
President and Chief Executive Officer, receives pension payments from the
Company under the SERP, and medical and dental coverage provided by the
Company for certain retired officers.
The Company entered into an agreement with Mr. Willes when he joined the
Company in 1995 relating to the terms of his employment with the Company.
Under that agreement, Mr. Willes was to serve as President and Chief Executive
Officer until January 1, 1996, and also as Chairman of the Board after that
date, at a salary of not less than $750,000 per year and with a target annual
incentive bonus of not less than $450,000, subject in 1995 to proration for
the number of months Mr. Willes was employed by the Company. The agreement
provided for Mr. Willes to receive a stock option grant for 108,000 shares and
35,000 shares of restricted stock in 1995, for a target deferred cash
incentive award of $600,000 for the 1995 through 1997 performance cycle under
the Company's 1992 Key Employee Long-Term Incentive Plan, and for the Company
to assume various costs and obligations in connection with Mr. Willes'
relocation to Los Angeles. Mr. Willes is entitled to participate in
retirement, deferred compensation, insurance and other employee benefit
programs. Pursuant to an amendment to his agreement effective February 1998,
he will receive a supplemental pension benefit so that his total pension
benefit from Times Mirror is equal to the greater of (a) the benefit he earns
under the SERP determined based on the aggregate of his service with Times
Mirror and his former employer (a total of approximately 17 years of service)
offset by the benefit he earned under the pension plans maintained by his
former employer and (b) the benefit provided under his original agreement,
which was the benefit Mr. Willes would have received under the pension plans
maintained by his former employer based on his service with Times Mirror and
his former employer and his salary with his former employer increased by 5%
per year offset by the benefit he actually earned under such pension plans.
The agreement further provides that if Mr. Willes terminates employment with
the Company prior to age 60 for "good reason" or if his employment is
terminated other than for "cause" or disability (as those terms are defined in
the agreement), the Company will (i) pay two years' salary and target bonus,
(ii) pay Mr. Willes' target annual bonus incentive award for the year of
termination, pro rated for the number of months of active employment in such
year, (iii) treat such termination as an early termination for purposes of
determining benefits under various benefit plans, (iv) seek to have the
restrictions on his restricted
22
<PAGE>
stock treated according to the terms applicable in situations of early
retirement, (v) provide for continued participation and service credit under
various retirement, deferred compensation, insurance and other employee
benefit programs, and (vi) provide such other benefits as are offered to
retiring officers.
The Company has an agreement with Mr. David Laventhol, a director of the
Company and its former President and Publisher of the Los Angeles Times, under
which he will be entitled to receive supplemental payments from the Company
sufficient to provide an aggregate pension benefit of $427,000 per year,
including payments under the Company pension plans, the ESOP and the SERP. In
addition, he will receive medical and dental coverage and death benefits
provided by the Company for certain retired officers.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
executive officers and directors, and persons who beneficially own more than
10% of the Company's Common Stock, to file initial reports of ownership and
changes in ownership with the Securities and Exchange Commission. Based on a
review of the copies of such forms furnished to the Company and written
representations from the Company's executive officers and directors, the
Company believes that all forms were filed in a timely manner during fiscal
1997, except that (i) a Form 4 for Otis Chandler with respect to one
transaction was filed late and (ii) a Form 4 for Gwendolyn Garland Babcock
with respect to one transaction was filed late.
REVOCATION OF PROXIES
Any shareholder may revoke a proxy by delivering a written notice of
revocation to the Company's transfer agent, Harris Trust and Savings Bank, P.
O. Box 1878, Chicago, Illinois 60690-9312, or to the Secretary of the Company
at Times Mirror Square, Los Angeles, California 90053, by executing another
proxy bearing a later date, or by voting the shares in person at the meeting
of shareholders.
1999 ANNUAL MEETING
Shareholder proposals must be received by the Company on or before November
27, 1998 to be considered for inclusion in the proxy statement and
presentation at the 1999 Annual Meeting of Shareholders, which is expected to
be held on May 6, 1999.
GENERAL
The cost of soliciting proxies will be borne by the Company. Proxy cards and
materials will also be distributed to beneficial owners of stock through
brokers, dealers, banks, voting trustees, custodians, nominees and other like
parties, and the Company will reimburse such parties for their charges and
expenses in connection with the distribution at the rates approved by the New
York Stock Exchange. The Company has retained Georgeson & Company Inc.
("Georgeson") to assist in the solicitation of proxies. Georgeson may solicit
proxies by mail, telephone, facsimile and personal solicitation, and will
request brokerage houses and other nominees, fiduciaries and custodians
nominally holding of record shares of Series A and Series C Common Stock to
forward proxy soliciting material to the beneficial owners of such shares. The
Company will pay Georgeson a fee estimated not to exceed $10,000 plus
reimbursement of expenses. In addition, following the original mailing of the
proxy soliciting material, directors, officers and regular employees of the
Company may solicit proxies by mail, telephone, facsimile and personal
interview, for which they will receive no additional compensation.
Stephen C. Meier
Secretary
March 27, 1998
23
<PAGE>
[LOGO OF TIMES MIRROR]
[RECYCLE LOGO]
Printed on recycled paper.
<PAGE>
PROXY PROXY
[LOGO OF TIMES MIRROR]
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS--MAY 7, 1998
THE UNDERSIGNED, REVOKING ALL PRIOR PROXIES, HEREBY APPOINTS MARK H. WILLES
AND THOMAS UNTERMAN, OR EACH OR EITHER OF THEM, PROXIES FOR THE UNDERSIGNED,
WITH FULL POWER OF SUBSTITUTION, TO VOTE ALL SHARES OF SERIES A COMMON STOCK
AND SERIES C COMMON STOCK WHICH THE UNDERSIGNED IS ENTITLED TO VOTE AT THE
ANNUAL MEETING OF SHAREHOLDERS OF THE TIMES MIRROR COMPANY TO BE HELD IN
MELVILLE, NEW YORK ON MAY 7, 1998 AT 10:30 A.M., EASTERN TIME, OR AT ANY
ADJOURNMENT OR POSTPONEMENT THEREOF, UPON SUCH BUSINESS AS MAY PROPERLY COME
BEFORE THE MEETING OR AT ANY ADJOURNMENT THEREOF INCLUDING, WITHOUT LIMITING
SUCH GENERAL AUTHORIZATION, THE PROPOSALS DESCRIBED ON THE REVERSE SIDE OF THIS
CARD AND IN THE ACCOMPANYING PROXY STATEMENT.
UNLESS OTHERWISE SPECIFIED ON THE REVERSE SIDE, THIS PROXY WILL BE VOTED FOR
THE ELECTION OF DIRECTORS, AND FOR RATIFICATION OF THE APPOINTMENT OF ERNST &
YOUNG LLP.
SERIES A AND SERIES C COMMON STOCK
(CONTINUED, AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
TIMES MIRROR
IMPORTANT: PLEASE MARK BOXES TO GIVE VOTING INSTRUCTIONS (SEE NOTE BELOW). [X]
[ ]
1. ELECTION OF DIRECTORS--Nominees: CLASS III: 01-Gwendolyn Garland Babcock,
02-Clayton W. Frye, Jr., 03-William Stinehart, Jr. and 04-Mark H. Willes
For All
For Withhold Except
[_] [_] [_]
- ------------------------------
Nominee Exceptions
2. Ratifying the appointment of Ernst & Young LLP as Independent Auditors for
the Company and its subsidiaries
For Against Abstain
[_] [_] [_]
The undersigned agrees that said proxies may vote in accordance with their
discretion with respect to any other matters which may properly come before
this meeting. Should any nominee for director become unavailable, discretionary
authority is conferred to vote for a substitute. The undersigned instructs such
proxies to vote as directed on the reverse side.
This Proxy should be dated, signed by the shareholder exactly as printed at the
left and returned promptly in the enclosed envelope. Persons signing in a
fiduciary capacity should so indicate.
Dated , 1998
-------------------
- -------------------------------
(Signature)
- --------------------------------
(Signature if held jointly)
[_] I PLAN TO ATTEND THE MEETING.
- --------------------------------------------------------------------------------
-- FOLD AND DETACH HERE --
CONTROL NUMBER [LOGO OF TIMES MIRROR]
[_]
VOTE BY TELEPHONE
CALL ** TOLL FREE ** ON A TOUCH TONE TELEPHONE
1-888-221-0694--ANYTIME
THERE IS NO CHARGE FOR THIS CALL
Your telephone vote authorizes the named
proxies to vote your shares in the same manner
as if you marked, signed and returned your
proxy card, and gives them discretion to vote
on such other matters as may properly come
before the meeting.
You will be asked to enter a Control Number
which is located in the box on the left side of
this form. IF YOU ENTER YOUR CONTROL NUMBER,
BUT DO NOT MAKE A CHOICE ON ANY ITEM, YOUR
SHARES WILL BE VOTED FOR ITEM 1 AND ITEM 2.
---
OPTION #1: TO VOTE AS THE BOARD OF DIRECTORS
RECOMMENDS ON ALL ITEMS: PRESS 1
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY
PRESSING 1.
OPTION #2: IF YOU CHOOSE TO VOTE ON EACH ITEM
SEPARATELY, PRESS 0. YOU WILL HEAR THESE
INSTRUCTIONS:
Item 1: To vote FOR ALL nominees, press 1;
to WITHHOLD FOR ALL nominees, press
9
To WITHHOLD FOR AN INDIVIDUAL nominee, Press
0 and listen to the instructions
Item 2: To vote FOR, press 1; AGAINST, press
9; ABSTAIN, press 0
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY
PRESSING 1.
IF YOU VOTE BY TELEPHONE, DO NOT MAIL BACK YOUR
PROXY.
THANK YOU FOR VOTING.
<PAGE>
PROXY PROXY
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS--MAY 7, 1998
TO: PARTICIPANTS IN THE TIMES MIRROR SAVINGS PLUS PLAN
AND THE TIMES MIRROR EMPLOYEE STOCK OWNERSHIP PLAN
THE TIMES MIRROR SAVINGS PLUS PLAN (THE "SPP") AND THE TIMES MIRROR EMPLOYEE
STOCK OWNERSHIP PLAN (THE "ESOP") PROVIDE THAT THE TRUSTEE SHALL VOTE ALL
SHARES OF TIMES MIRROR COMMON STOCK HELD IN THE SPP (INCLUDING PAYSOP) AND ALL
SHARES ALLOCATED TO PARTICIPANTS' ACCOUNTS UNDER THE ESOP AT ANY MEETING OF
SHAREHOLDERS OF THE COMPANY IN ACCORDANCE WITH WRITTEN INSTRUCTIONS FROM THE
PARTICIPANTS. PLEASE MARK YOUR VOTING INSTRUCTIONS FOR THE MAY 7, 1998 ANNUAL
MEETING OF SHAREHOLDERS OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF IN THE
SPACES PROVIDED ON THE REVERSE SIDE OF THIS CARD, SIGN AND DATE THE FORM AND
RETURN IT TO THE COMPANY'S TRANSFER AGENT IN THE ENCLOSED POSTAGE PREPAID
ENVELOPE. PLEASE RETURN THIS CARD PROMPTLY.
THE TRUSTEES
YOU MAY RECEIVE OTHER INSTRUCTION CARDS FOR SHARES REGISTERED IN A DIFFERENT
MANNER. IF SO, PLEASE SIGN AND RETURN ALL SUCH INSTRUCTION CARDS IN THE
ENCLOSED ENVELOPE.
SERIES A AND SERIES C COMMON STOCK
TO: TRUSTEES FOR THE TIMES MIRROR SAVINGS PLUS PLAN AND THE TIMES MIRROR
EMPLOYEE STOCK OWNERSHIP PLAN
PLEASE VOTE ALL SHARES OF TIMES MIRROR SERIES A AND SERIES C COMMON STOCK HELD
IN MY ACCOUNT UNDER THE TIMES MIRROR SAVINGS PLUS PLAN (INCLUDING PAYSOP) AND
ALL SUCH SHARES ALLOCATED TO MY ACCOUNT UNDER THE TIMES MIRROR EMPLOYEE STOCK
OWNERSHIP PLAN AS FOLLOWS:
(CONTINUED, AND TO BE SIGNED ON REVERSE SIDE)
<PAGE>
TIMES MIRROR
IMPORTANT: PLEASE MARK BOXES TO GIVE VOTING INSTRUCTIONS (SEE NOTE BELOW).[X]
[ ]
1. ELECTION OF DIRECTORS--Nominees: CLASS III: 01-Gwendolyn Garland Babcock,
02-Clayton W. Frye, Jr., 03-William Stinehart, Jr. and 04-Mark H. Willes
FOR [_] WITHHOLD [_] FOR ALL EXCEPT [_]
--------------------------
Nominee Exceptions
2. Ratifying the appointment of Ernst & Young LLP as Independent Auditors for
the Company and its subsidiaries
FOR [_] AGAINST [_] ABSTAIN [_]
Dated: __________________________________________________________________ , 1998
- --------------------------------------------------------------------------------
Please sign exactly as imprinted at left
NOTE: Your voting instructions are solicited for shares in your Savings Plus
Plan account (including PAYSOP) and shares allocated to your account under the
ESOP. All such shares will be voted as you direct, but if you fail to return
your instructions your shares held in the ESOP and in the PAYSOP portion of the
Savings Plus Plan will be voted by the Trustees as directed by the Plan
Administration Committee appointed by the Board of Directors of the Company.
Your shares in the Savings Plus Plan, exclusive of the PAYSOP account, will
remain unvoted and will be recorded as abstentions if you fail to return your
instructions.
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-- FOLD AND DETACH HERE --
CONTROL NUMBER [LOGO OF TIMES MIRROR]
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VOTE BY TELEPHONE
CALL HH TOLL FREE HH ON A TOUCH TONE TELEPHONE
1-888-221-0694--ANYTIME
THERE IS NO CHARGE FOR THIS CALL
Your telephone vote authorizes the Trustee to
vote your shares in the same manner as if you
marked, signed and returned your proxy card.
You will be asked to enter a Control Number
which is located in the box on the left side of
this form. IF YOU ENTER YOUR CONTROL NUMBER,
BUT DO NOT MAKE A CHOICE ON ANY ITEM, YOUR
SHARES WILL BE VOTED FOR ITEM 1 AND ITEM 2.
OPTION #1: TO VOTE AS THE BOARD OF DIRECTORS
RECOMMENDS ON ALL ITEMS: PRESS 1
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY
PRESSING 1.
OPTION #2: IF YOU CHOOSE TO VOTE ON EACH ITEM
SEPARATELY, PRESS 0. YOU WILL HEAR THESE
INSTRUCTIONS:
Item 1: To vote FOR ALL nominees, press 1;
to WITHHOLD FOR ALL nominees, press 9
To WITHHOLD FOR AN INDIVIDUAL nominee, Press 0
and listen to the instructions
Item 2: To vote FOR, press 1; AGAINST, press 9;
ABSTAIN, press 0
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY
PRESSING 1.
IF YOU VOTE BY TELEPHONE, DO NOT MAIL BACK YOUR
PROXY.
THANK YOU FOR VOTING.
