<PAGE> 1
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 240.14a-11(c) or 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:
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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
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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
previously paid. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
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<PAGE> 2
<TABLE>
<S> <C>
LOGO TIMES MIRROR TIMES MIRROR
Times Mirror Square
Los Angeles, CA 90053
MARK H. WILLES
Chairman, President and
Chief Executive Officer,
and Publisher,
Los Angeles Times
</TABLE>
March 26, 1999
Dear Times Mirror Shareholder:
We are pleased to invite you to attend the 1999 Annual Meeting of
Shareholders of The Times Mirror Company. The meeting will be held at the
offices of the Los Angeles Times, Orange County Edition, at 1375 Sunflower
Avenue in Costa Mesa, California on Thursday, May 6, 1999 at 10:00 a.m.
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 1998. After the meeting, there will be
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 or follow the
instructions on the proxy card to vote your shares by telephone 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 6.
Sincerely,
/s/ Mark H. Willes
Mark H. Willes
Chairman of the Board, President and
Chief Executive Officer, and
Publisher, Los Angeles Times
<PAGE> 3
LOGO 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 the Los Angeles Times, Orange County Edition, at 1375 Sunflower
Avenue in Costa Mesa, California on Thursday, May 6, 1999 at 10:00 a.m. for the
following purposes:
1. To elect five persons to Class I of the Board of Directors in accordance
with Article VIII, Section 1 of the Company's Restated 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, 1999.
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 10, 1999 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. Alternatively, you may vote your shares by
telephone. Please see the enclosed proxy card for instructions.
By Order of the Board of Directors,
/s/ Stephen C. Meier
Stephen C. Meier
Secretary
March 26, 1999
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Proxy Statement............................................. 1
Election of Directors....................................... 2
Nominees for Directors...................................... 2
Continuing Directors........................................ 3
Compensation of Directors................................... 6
Committees of the Board of Directors........................ 6
Appointment of Independent Auditors......................... 8
Other Matters............................................... 8
Ownership of Voting Securities.............................. 9
Executive Compensation...................................... 13
Option Grants Table......................................... 15
Aggregated Option Exercises in 1998 and Option Values as of
December 31, 1998......................................... 16
Report of the Executive Compensation Subcommittee on
Executive Compensation.................................... 17
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
2000 Annual Meeting......................................... 23
General..................................................... 23
</TABLE>
<PAGE> 5
PROXY STATEMENT
------------------------
ANNUAL MEETING OF SHAREHOLDERS OF
THE TIMES MIRROR COMPANY
------------------------
MAY 6, 1999
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 6, 1999 or at any
adjournment or postponement of the meeting (the "1999 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 26, 1999. A
shareholder giving a proxy may revoke it at any time before it is exercised (see
Revocation of Proxies on page 23). Any proxy that 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 I
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, 1999.
On March 10, 1999, the record date for the determination of Company
shareholders entitled to notice of and to vote at the meeting, 47,515,394 shares
of Series A Common Stock and 25,176,553 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 five 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, 1999. 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, 1998 is
being mailed to shareholders with this Proxy Statement.
THE TIMES MIRROR COMPANY
TIMES MIRROR SQUARE, LOS ANGELES, CALIFORNIA 90053
<PAGE> 6
ELECTION OF DIRECTORS
One of the purposes of the 1999 Annual Meeting is the election of five
persons to Class I of the Board of Directors in accordance with Article VIII,
Section 1 of the Company's Restated 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 I 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 I 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.
Donald R. Beall, Sherry L. Lansing, Dawn Gould Lepore, Robert W. Schult and
Warren B. Williamson were recommended by the Nominating Committee for election
at the 1999 Annual Meeting to serve until the Annual Meeting to be held in 2002
and until their respective successors are elected and qualified.
The current term of directors in Class II will continue until the Annual
Meeting in 2000 and the current term of directors in Class III will continue
until the Annual Meeting in 2001 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 10, 1999 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 I of
the Board of Directors (to serve three-year terms ending at the Annual Meeting
to be held in 2002 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.
PHOTO
DONALD R. BEALL, 60, 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 the Executive
Committee and Retired Chairman of the Board and Chief
Executive Officer of Rockwell International Corporation, a
leader in industrial automation, avionics and communications
systems markets. 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 a M.B.A. degree
from the University of Pittsburgh. He was also a director of
Amoco Corporation until December 31, 1998. Currently, he is a
director of Rockwell International Corporation, Procter &
Gamble Company, Meritor Automotive, Inc. (a spin-off of
Rockwell's automotive components business) and Conexant
Systems, Inc. (a spin-off of Rockwell's semiconductor
business).
2
<PAGE> 7
PHOTO
SHERRY L. LANSING, 54, has been a director of the Company
since December 1998 and became a member of the Compensation
Committee in March 1999. She is Chairman and Chief Executive
Officer of the Motion Picture Group of Paramount Pictures, a
leading global entertainment company. She is responsible for
overseeing all aspects of motion picture operations of
Paramount Picture's Motion Picture Group. Prior to being named
Chairman in 1992, Ms. Lansing headed her own independent
production company. Ms. Lansing received a B.S. degree from
Northwestern University.
PHOTO
DAWN GOULD LEPORE, 45, has been a director of the Company
since December 1998 and became a member of the Finance
Committee in March 1999. She is Executive Vice President and
Chief Information Officer of the Charles Schwab Corporation,
one of the nation's largest financial service firms. She is
responsible for the Charles Schwab Corporation's worldwide use
of information technology, including all telecommunications,
operations and customer and business applications. Prior to
assuming her position in 1993, Ms. Lepore was Senior Vice
President of Information Technology for the Charles Schwab
Corporation and had held other positions since joining the
Company in 1983. Ms. Lepore received a B.A. degree from Smith
College.
PHOTO
ROBERT W. SCHULT, 49, has been a director of the Company since
July 1998 and became a member of the Audit and Public
Responsibility Committee and the Finance Committee in July
1998. He is President and Chief Operating Officer of Nestle
USA, Inc., a subsidiary of Nestle S.A., a food company. He has
held those positions since July 1996. Prior to that, Mr.
Schult served as President of the Nestle Food Company, an
operating company of Nestle USA, for 6 years. Mr. Schult
received a B.A. degree from the University of North Carolina.
PHOTO
WARREN B. WILLIAMSON, 70, 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
Board of Trustees of the Chandler Trusts. (See Certain
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.
CONTINUING DIRECTORS
CLASS II (currently serving until the 2000 Annual Meeting and until their
respective successors are elected and qualified):
PHOTO
JOHN E. BRYSON, 55, has been a director of the Company since
1991 and is a member of the Nominating Committee and the Audit
and Public Responsibility Committee. He is Chairman of the
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.
3
<PAGE> 8
PHOTO
ROGER GOODAN, 53, has been a director of the Company since
December 1998 and became a member of the Finance Committee in
March 1999. He is Vice President of Marketing for Schlumberger
Oilfield Services North America. He has held this position
since February 1998. Prior to that, Mr. Goodan has held
management positions throughout Schlumberger including
positions in operations, engineering and finance since 1973.
Mr. Goodan holds B.A. degrees from the University of
California at Berkeley and Stanford University. Mr. Goodan is
also a director of the Offshore Energy Center in Houston and
the Stanford University Department of Athletics. He is also a
beneficiary of the Chandler Trusts. (See Certain Relationships
and Related Transactions beginning on page 21.)
PHOTO
BRUCE CHANDLER, 62, 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 of
the University of Southern California and holds a J.D. 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.)
PHOTO
DR. ALFRED E. OSBORNE, JR., 54, has been a director of the
Company since 1980 and is Chairman of the Audit and Public
Responsibility Committee and a member of the Compensation
Committee, the Executive Compensation Subcommittee of the
Compensation Committee and the Nominating Committee. He is
Director of the Harold Price Center for Entrepreneurial
Studies and Associate Professor of Business Economics at the
John E. Anderson Graduate School of Management at the
University of California, at Los Angeles. 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 WM Group of Funds and an independent general
partner of Technology Funding Venture Partners V, both of
which are 1940 Investment Company Act companies.
PHOTO
DR. EDWARD ZAPANTA, 60, has been a director of the Company
since 1988 and is Chairman of the Nominating Committee and a
member of the Audit and Public Responsibility Committee, the
Compensation Committee and the Executive Compensation
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, East-West
Bancorp, Inc. and the Irvine Foundation.
4
<PAGE> 9
CLASS III (currently serving until the 2001 Annual Meeting and until their
respective successors are elected and qualified):
PHOTO
GWENDOLYN GARLAND BABCOCK, 63, has been a director of the
Company since 1976 and is a member of the Nominating
Committee. She has been a private investor for more than 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.)
PHOTO
CLAYTON W. FRYE, JR., 68, has been a director of the Company
since 1988 and is Chairman of the Compensation Committee and
the Executive Compensation Subcommittee of the Compensation
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 several
privately-held companies including King Ranch. Mr. Frye serves
as a Trustee of The White House Historical Association and
other not-for-profit foundations.
PHOTO
WILLIAM STINEHART, JR., 55, 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 practiced law since 1969.
Gibson, Dunn & Crutcher LLP has 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).
PHOTO
MARK H. WILLES, 57, 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
time. He was elected Chairman of the Board effective January
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.
5
<PAGE> 10
COMPENSATION OF DIRECTORS
The Board of Directors presently has fourteen directors, one of whom is a
salaried employee of the Company. Salaried employees receive no additional
compensation or benefits for their service as directors. Except as noted below,
during 1998, 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. Mr. Schult, who
was elected to the Board of Directors on July 9, 1998, received for 1998 a
pro-rated retainer of 270 shares of Series A Common Stock and a cash payment
equal to the value of 270 shares of such stock. Mr. Goodan, Ms. Lansing and Ms.
Lepore, who were elected to the Board of Directors on December 3, 1998, each
received for 1998 a pro-rated retainer of 40 shares of Series A Common Stock and
a cash payment equal to the value of 40 shares of such 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. Mr. Schult received for 1998 a pro-rated option grant for
2,700 shares of Series A Common Stock. Mr. Goodan, Ms. Lansing and Ms. Lepore
each received for 1998 a pro-rated option grant of 400 shares of Series A Common
Stock.
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.
COMMITTEES OF THE BOARD OF DIRECTORS
The standing committees of the Board are the Audit and Public
Responsibility Committee, Compensation Committee, Executive Compensation
Subcommittee of the Compensation Committee, Finance Committee and Nominating
Committee. The functions of each of these five committees are described and the
members of each are listed below.
6
<PAGE> 11
Each year, the Audit and Public Responsibility 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 Committee also 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 Audit and Public
Responsibility Committee are Dr. Alfred E. Osborne, Jr. (Chairman), John E.
Bryson, Robert W. Schult and Dr. Edward Zapanta, none of whom is either an
officer or employee of the Company. The Audit and Public Responsibility
Committee met three times in 1998.
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
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, Sherry L. Lansing,
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 two times in 1998.
The Executive Compensation Subcommittee of the Compensation Committee
determines the compensation of and approves stock and stock option grants to
executive officers of the Company. Clayton W. Frye, Jr. (Chairman), Donald R.
Beall, 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 met two times in 1998.
The Finance Committee reviews financial policies and performance objectives
as developed by the Company's management. Warren B. Williamson (Chairman), Bruce
Chandler, Roger Goodan, Dawn Gould Lepore, Robert W. Schult and William
Stinehart, Jr. are the members of the Finance Committee, which met three times
in 1998.
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, John E. Bryson, Dr.
Alfred E. Osborne, Jr. and William Stinehart, Jr. The Nominating Committee
recommended the nomination of all of the nominees to Class I for election at the
1999 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 three times in 1998.
In 1998, there were 10 meetings of the Board of Directors. During the year,
each of the incumbent directors attended at least 75% of the aggregate number of
meetings of the Board and the committees on which he or she sits.
7
<PAGE> 12
APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company, on the recommendation of its Audit
and Public Responsibility 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 1999.
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 and Public Responsibility 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 1999 Annual Meeting. Ernst
& Young LLP has indicated that it does not presently intend to make a statement
at the 1999 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 1999 Annual
Meeting other than the matters described above. If any other matter properly
comes before the 1999 Annual Meeting, however, the proxy holders will vote on
those matters in accordance with their best judgment.
8
<PAGE> 13
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 10, 1999 (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 plan trusts 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
COMMON OF COMMON OF
NAME AND ADDRESS OF BENEFICIAL OWNER STOCK SERIES(1) STOCK SERIES(1)
------------------------------------ --------- --------- ---------- ---------
<S> <C> <C> <C> <C>
The Trustees of the Chandler Trusts(2)............. 9,305,624 19.58% 20,757,246 82.45%
350 West Colorado Boulevard
Suite 230
Pasadena, CA 91105
The Times Mirror Employee Stock Ownership
Trust(3)......................................... 3,102,933 6.53% 1,484,810 5.90%
Times Mirror Square
Los Angeles, CA 90053
Times Mirror Savings Plus Plan Trust(4)............ 2,190,302 4.61% 159,472 .63%
Times Mirror Square
Los Angeles, CA 90053
Putnam Investments, Inc.(5)........................ 5,812,530 12.23% -- --
Marsh & McLennan Companies, Inc.
Putnam Investment Management, Inc.
The Putnam Advisory Company, Inc.
One Post Office Square
Boston, MA 02109
FMR Corp.(6)....................................... 5,331,741 11.22% -- --
82 Devonshire Street
Boston, MA 02109
</TABLE>
- ---------------
(1) The percentages are based on the number of shares outstanding of each class
of voting securities as of March 10, 1999, as reflected in the records of
the Company. Shares of Series C Common Stock automatically convert into
shares of Series A Common Stock upon being transferred, other than transfers
to certain permitted transferees as specified in the Company's Restated
Certificate of Incorporation.
(2) On March 10, 1999, 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 18,272 shares of Series A Common Stock (over
all of which Mrs. Babcock has sole voting and dispositive power), including
15,000 shares of Series A Common Stock which she may acquire upon the
exercise of outstanding stock options and 2,029 stock units deferred under
The Times Mirror Non-Employee Directors Stock Plan. Her husband holds 900
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 Mrs. Babcock, four other
trustees of the Chandler Trusts own Series A Common Stock individually or as
trustee as follows: 113,801 shares by Camilla Chandler Frost (over all of
which Mrs. Frost has sole voting and dispositive power); 16,748 shares by
Bruce Chandler (over all of which Mr. Chandler has sole voting and
dispositive power), including 15,000 shares of Series A Common Stock which
he may acquire upon the exercise of outstanding stock options; 18,787 shares
by William Stinehart, Jr. (of which he has sole voting and dispositive power
over 18,044 shares), including 15,000 shares of Series A Common Stock which
he may acquire upon the exercise of outstanding stock options, 3,044 stock
units deferred under The Times Mirror Non-Employee Directors Stock Plan and
743 shares held as co-trustee, of which he disclaims beneficial ownership;
and 18,692 shares by Warren B. Williamson (over all of which Mr. Williamson
has
9
<PAGE> 14
sole voting and dispositive power), including 15,000 shares of Series A
Common Stock which he may acquire upon the exercise of outstanding stock
options and 3,409 stock units deferred under The Times Mirror Non-Employee
Directors Stock Plan. On March 10, 1999, the individuals who act as trustees
of the Chandler Trusts (see Certain Relationships and Related Transactions
beginning on page 21) beneficially owned, directly or indirectly, in their
capacities as individuals and as trustees of the Chandler and other trusts
an aggregate of 9,496,053 shares of Series A Common Stock and 20,769,906
shares of Series C Common Stock constituting 19.99% of the shares of Series
A Common Stock and 82.50% of the shares of Series C Common Stock outstanding
on that date, representing 72.57% 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 February 8, 1999. 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 will be voted by Fidelity Management
Trust Company, as the trustee of the ESOP. Fidelity Management Trust Company
replaced The Northern Trust Company as trustee of the ESOP on April 1, 1998.
The Plan Administration Committee, which is appointed by the Board of
Directors of the Company, 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 four officers of the Company, three of
whom are Mark H. Willes, Thomas Unterman and Donald F. Wright.
(4) Based on holdings as of February 8, 1999. 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 filed with the Securities
and Exchange Commission (the "SEC") on February 12, 1999 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.
(6) This information is based solely on a Schedule 13G dated February 1, 1999
filed with 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 ("FMRC"). FMRC is the beneficial
owner of 2,996,617 shares of Series A Common Stock as a result of acting as
investment advisor to various registered investment companies. Edward C.
Johnson 3d, Chairman of FMR Corp., FMR Corp., through its control of FMRC,
and the investment companies, each has sole power to dispose of the
2,996,617 shares owned by the investment companies. Neither Mr. Johnson nor
FMR Corp. has the sole power to vote the 2,996,617 shares owned by the
investment companies, which power resides in the board of trustees of the
investment companies. Fidelity Management Trust Company ("FMTC"), a
subsidiary of FMR Corp., is the beneficial owner of 2,334,824 shares of
Series A Common Stock as a result of it serving as investment manager of
institutional accounts. Mr. Johnson and FMR Corp., through its control of
FMTC, each has sole dispositive power over 2,334,824 shares, sole power to
vote 2,324,324 shares and no power to vote 10,500 shares owned by
institutional accounts. Fidelity International Limited ("FIL"), a company
partially owned indirectly by certain shareholders of FMR Corp., is the
beneficial owner of 300 shares of Series A Common Stock. FIL has sole power
to dispose of and to vote the 300 shares. See also Notes (3) and (4) above.
10
<PAGE> 15
BENEFICIAL OWNERSHIP OF MANAGEMENT
The following table shows the beneficial ownership as of March 10, 1999
(except as otherwise noted) 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) beginning 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.
TABLE OF BENEFICIAL OWNERSHIP OF MANAGEMENT
<TABLE>
<CAPTION>
SERIES A SERIES C SERIES C-1
COMMON STOCK COMMON STOCK PREFERRED STOCK
------------------------------------- ---------------------------- -------------------
PERCENT PERCENT PERCENT
OF OF OF
NAME TOTAL(1)(2) SERIES TOTAL(1) SERIES TOTAL SERIES
---- -------------------- ------- --------------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Gwendolyn Garland
Babcock............ 9,328,025(3)(4)(5) 19.63% 20,769,906(4)(5) 82.50% 380,972(4) 100%
Donald R. Beall...... 19,287(3)(5) * -- -- -- --
John E. Bryson....... 21,432(3) * -- -- -- --
Bruce Chandler....... 9,322,372(4) 19.62% 20,757,246(4) 82.45% 380,972(4) 100%
Kathryn M. Downing... 89,429(6) * -- -- -- --
Clayton W. Frye,
Jr. ............... 22,893 * 190 * -- --
Roger Goodan......... 7,090(5) * -- -- -- --
Mary E. Junck........ 43,879(6) * -- -- -- --
Sherry L. Lansing.... 5,940 * -- -- -- --
Dawn Gould Lepore.... 6,483(3) * -- -- -- --
Dr. Alfred E.
Osborne, Jr. ...... 19,611(3) * 385 * -- --
Robert W. Schult..... 8,470 * -- -- -- --
William Stinehart,
Jr. ............... 9,324,411(3)(4)(5) 19.62% 20,757,246(4) 82.45% 380,972(4) 100%
Thomas Unterman...... 138,504(6) * -- -- -- --
Mark H. Willes....... 490,715(6) 1.03% -- -- -- --
Warren B.
Williamson......... 9,324,316(3)(4) 19.62% 20,757,246(4) 82.45% 380,972(4) 100%
Donald F. Wright..... 69,365(5)(6) * 4,932 * -- --
Dr. Edward Zapanta... 15,252(3)(7) * -- -- -- --
All directors and
executive officers
as a group (24
persons, including
those named
above)............. 10,652,588 22.42% 20,787,621 82.57% 380,972(4) 100%
<CAPTION>
SERIES C-2
PREFERRED STOCK
--------------------
PERCENT
OF
NAME TOTAL SERIES
---- ---------- -------
<S> <C> <C>
Gwendolyn Garland
Babcock............ 245,100(4) 100%
Donald R. Beall...... -- --
John E. Bryson....... -- --
Bruce Chandler....... 245,100(4) 100%
Kathryn M. Downing... -- --
Clayton W. Frye,
Jr. ............... -- --
Roger Goodan......... -- --
Mary E. Junck........ -- --
Sherry L. Lansing.... -- --
Dawn Gould Lepore.... -- --
Dr. Alfred E.
Osborne, Jr. ...... -- --
Robert W. Schult..... -- --
William Stinehart,
Jr. ............... 245,100(4) 100%
Thomas Unterman...... -- --
Mark H. Willes....... -- --
Warren B.
Williamson......... 245,100(4) 100%
Donald F. Wright..... -- --
Dr. Edward Zapanta... -- --
All directors and
executive officers
as a group (24
persons, including
those named
above)............. 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 February 8, 1999. Also includes shares held in
the Company's Dividend Reinvestment Plan as of December 31, 1998. Shares of
Series C Common Stock automatically convert into shares of Series A Common
Stock upon being transferred, other than transfers to certain permitted
transferees as specified in the Company's Restated Certificate of
Incorporation.
11
<PAGE> 16
(2) Includes shares which may be acquired upon the exercise of outstanding stock
options and that are currently exercisable within 60 days of March 10, 1999
as follows: 15,000 by Mrs. Babcock; 15,000 by Mr. Beall; 18,653 by Mr.
Bryson; 15,000 by Mr. Chandler; 73,450 by Ms. Downing; 15,000 by Mr. Frye;
5,400 by Mr. Goodan; 31,250 by Ms. Junck; 5,400 by Ms. Lansing; 5,400 by Ms.
Lepore; 15,000 by Dr. Osborne; 7,700 by Mr. Schult; 15,000 by Mr. Stinehart;
116,390 by Mr. Unterman; 393,150 by Mr. Willes; 15,000 by Mr. Williamson;
44,900 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. See Note (2) beginning on page
9 and Certain Relationships and Related Transactions beginning on page 21.
(5) Includes shares held in trust, or other capacities, as to which beneficial
ownership is disclaimed. Mr. Beall shares voting and dispositive power with
respect to 1,243 shares and Mr. Wright shares voting and dispositive power
with respect to 400 shares. Includes 150 shares owned by Mr. Goodan's
daughter, who lives in his household. See Note (2) beginning on page 9 for
voting and dispositive power of other persons indicated.
(6) Includes shares of restricted stock, including shares granted under the
matching restricted stock program of The Times Mirror Company 1996
Management Incentive Plan.
(7) Includes shares held in an Individual Retirement Account.
12
<PAGE> 17
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, 1998. This table includes
information for each individual for services in all capacities to the Company
for the fiscal years ended December 31, 1998, 1997 and 1996, unless otherwise
noted.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
---------------------------------
AWARDS PAYOUTS
----------------------- -------
ANNUAL COMPENSATION SECURITIES
----------------------------------- RESTRICTED UNDERLYING
OTHER ANNUAL STOCK STOCK LTIP ALL OTHER
SALARY BONUS COMPENSATION AWARDS OPTIONS PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($)(1) ($)(2) ($)(3) (#)(4) ($)(5) ($)(6)
--------------------------- ---- ------- --------- ------------- ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Mark H. Willes.................... 1998 900,000 2,025,000 37,642 508,002 200,000 -- 9,015
Chairman of the Board, President 1997 905,770 1,968,750 9,700 494,606 200,000 -- 69,972
and Chief Executive Officer, 1996 798,076 1,350,000 2,900 338,859 180,200 745,084 104,623
and Publisher, Los Angeles Times
Thomas Unterman................... 1998 549,999 1,562,500 12,226 141,142 65,000 -- 11,124
Executive Vice President and 1997 517,308 506,250 3,621 127,179 65,000 -- 7,084
Chief Financial Officer 1996 450,000 405,000 1,740 101,672 50,700 378,751 6,609
Kathryn M. Downing................ 1998 448,923 712,501 7,076 112,914 40,000 -- 143,471
Executive Vice President, 1997 389,808 325,277 1,536 81,754 30,000 -- 6,694
and President and Chief 1996 325,000 199,875 372 177,516 39,600 -- 4,521
Executive Officer,
Los Angeles Times
Mary E. Junck (7)................. 1998 458,654 397,500 -- 99,759 40,000 -- 7,406
Executive Vice President, 1997 369,807 358,064 9,000 89,976 30,000 -- 6,694
and President, Eastern 1996 330,000 315,000 9,000 206,390 57,100 266,988 6,044
Newspapers
Donald F. Wright (7).............. 1998 500,000 272,500 18,544 68,406 40,000 -- 7,143
Executive Vice President 1997 452,116 407,157 11,304 102,338 40,000 -- 6,995
1996 404,999 360,000 7,043 90,375 42,800 416,005 46,871
</TABLE>
- ---------------
(1) An officer may elect to take his or her bonus award in the form of cash or
deferred cash. An officer may also elect to take 25% of such bonus award in
shares of Series A Common Stock. The amounts shown in this column for 1998
include special bonus payments of $1,000,000 for Mr. Unterman and $450,000
for Ms. Downing in recognition of the successful completion of the
divestitures of Matthew Bender & Company, Incorporated, Shepard's and Mosby,
Inc. The amounts include bonuses earned in the indicated year and paid in
the subsequent year and exclude bonuses paid in the indicated year but
earned in the preceding year.
(2) Represents amounts paid in cash as allowances for certain perquisites or to
reimburse the named officers for the tax impact of certain perquisites. Also
represents amounts credited on deferred compensation at above-market
interest rates. 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. Special promotional grants of
3,500 shares in 1996 to Ms. Junck and to Ms. Downing 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 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,
February 5, 1998 for 1997 compensation and on February 4, 1999 for 1998
compensation under the matching restricted stock program will vest 100%
after four years, provided that
13
<PAGE> 18
the officer does not terminate employment with the Company prior to that
time or withdraw the shares deposited with the Company for the match. An
amount equal to regular dividends is paid on restricted shares. As of
December 31, 1998, the number and value of restricted stock award holdings,
which do not include the restricted shares granted on February 4, 1999 for
1998 compensation, were as follows: 33,211 ($1,859,816) for Mr. Willes,
16,850 ($943,600) for Mr. Unterman, 8,348 ($467,488) for Ms. Downing, 5,855
($327,880) for Ms. Junck and 3,683 ($206,248) for Mr. Wright.
(4) Options 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. 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. Options for Ms. Junck and Ms. Downing for 1996 also
include special promotional grants of 25,000 stock options. Options reported
for Mr. Unterman for 1997 and 1998 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.
(6) The amounts shown in this column for 1998 consist of the following: (i) Mr.
Willes, $4,215 of term life insurance premiums paid and $4,800 for matching
Company contributions under the Times Mirror Savings Plus Plan (the "Savings
Plan"); (ii) Mr. Unterman, $2,574 of term life insurance premiums paid,
$4,800 for matching Company contributions under the Savings Plan and $3,750
as a special payment; (iii) Ms. Downing, $50,000 housing differential
payment (see pages 22 and 23), $86,565 for relocation assistance, $2,106 of
term life insurance premiums paid and $4,800 for matching Company
contributions under the Savings Plan; (iv) Ms. Junck, $2,106 of term life
insurance premiums paid, $4,800 for matching Company contributions under the
Savings Plan and $500 as a special payment; and (v) Mr. Wright, $2,343 of
term life insurance premiums paid and $4,800 for matching Company
contributions under the Savings Plan. The amounts shown in this column for
1997 consist of the following: (i) Mr. Willes, $62,102 for relocation
assistance (see page 22), $3,120 of term life insurance premiums paid and
$4,750 for matching Company contributions under the Savings Plan; (ii) Mr.
Unterman, $2,334 of term life insurance premiums paid and $4,750 for
matching Company contributions under the Savings Plan; (iii) Ms. Downing,
$1,944 for term life insurance premiums paid and $4,750 for matching Company
contributions under the Savings Plan; (iv) Ms. Junck, $1,944 for term life
insurance premiums paid and $4,750 for matching Company contributions under
the Savings Plan; and (v) Mr. Wright, $2,245 of term life insurance premiums
paid and $4,750 for matching Company contributions under the Savings Plan.
The amounts shown in this column for 1996 consist of the following: (i) Mr.
Willes, $97,003 for relocation assistance (see page 22), $3,120 of term life
insurance premiums paid and $4,500 for matching Company contributions under
the Savings Plan; (ii) Mr. Unterman, $2,109 of term life insurance premiums
paid and $4,500 for matching Company contributions under the Savings Plan;
(iii) Ms. Downing, $1,521 for term life insurance premiums paid and $3,000
for matching Company contributions under the Savings Plan; (iv) Ms. Junck,
$1,544 for term life insurance premiums paid and $4,500 for matching Company
contributions under the Savings Plan; and (v) Mr. Wright, $40,474 for a
payout for accrued vacation, $1,897 for term life insurance premiums paid
and $4,500 for matching Company contributions under the Savings Plan.
(7) Mr. Wright resigned from his positions with the Company effective as of
February 5, 1999 and Ms. Junck is resigning from her positions with the
Company in April 1999.
14
<PAGE> 19
OPTION GRANTS TABLE
The following table sets forth all grants of stock options with respect to
shares of Series A Common Stock for 1998 to the named executive officers of the
Company under the Company's 1996 Management Incentive Plan.
OPTION GRANTS FOR FISCAL YEAR 1998
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ------------------------------------------------------------------------------------------------------
NUMBER OF % OF
SECURITIES TOTAL
UNDERLYING OPTIONS EXERCISE
OPTIONS GRANTED TO OR BASE GRANT DATE
GRANTED EMPLOYEES PRICE EXPIRATION PRESENT
NAME (#)(1) FOR 1998 ($/SH) DATE VALUE($)(2)
---- ---------- ---------- -------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Mark H. Willes..................... 200,000 4.4% $58.0312 2/5/2008 2,554,000
Thomas Unterman.................... 65,000 1.4% $58.0312 2/5/2008 830,050
Kathryn M. Downing................. 40,000 0.9% $58.0312 2/5/2008 510,800
Mary E. Junck...................... 40,000 0.9% $58.0312 2/5/2008 510,800
Donald F. Wright................... 40,000 0.9% $58.0312 2/5/2008 510,800
</TABLE>
- ---------------
(1) These options were granted at fair market value on February 5, 1998 and
related to compensation for 1998. 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. The 1998 stock option grant to Mr. Wright provided that
the non-vested options under that grant will fully vest upon his retirement
from the Company. 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 0.20 derived by averaging the weekly
historical volatility of the Company over the 52 week period prior to
February 5, 1998 (the "Measurement Period"); (b) a risk-free rate of return
based on the rate (5.50%) 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 Black-Scholes ratio was applied to the average of the
closing prices for the most recent 20 trading days ending February 5, 1998.
15
<PAGE> 20
AGGREGATED OPTION EXERCISES IN 1998 AND
OPTION VALUES AS OF DECEMBER 31, 1998
The following table sets forth certain information with respect to
exercises by the named executive officers of stock options with respect to
shares of Series A Common Stock during 1998, the number of securities underlying
unexercised options held by the named executive officers at December 31, 1998
and the value of unexercised in-the-money options as of December 31, 1998.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS AS OF OPTIONS AS OF
DECEMBER 31, 1998(#) DECEMBER 31, 1998($)(1)
SHARES ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mark H. Willes........... -- -- 293,150 395,050 7,536,175 2,387,975
Thomas Unterman.......... 62,532 2,543,932 83,890 126,425 2,110,287 732,834
Kathryn M. Downing....... -- -- 49,700 84,900 979,103 633,972
Mary E. Junck............ 34,912 1,171,901 7,500 83,025 69,844 568,113
Donald F. Wright......... -- -- 168,627 80,700 5,452,922 514,775
</TABLE>
- ---------------
(1) Represents the difference between the closing price of the Company's Series
A Common Stock on December 31, 1998 ($56.00) and the option price on the
date of grant.
16
<PAGE> 21
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 EXECUTIVE COMPENSATION SUBCOMMITTEE
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
"Subcommittee") the authority to review, consider and determine the compensation
of the Company's executive officers. The names of the Subcommittee's members
appear below. None of the members of the Subcommittee is employed by the Company
and none is employed by companies whose boards of directors include an officer
of the Company.
Compensation Policies
Consistent with the policies followed by the Committee in the past, the
Subcommittee's policies are designed to assist the Company in attracting,
retaining and motivating qualified executives by providing competitive levels of
compensation that directly align 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 1998, 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
Subcommittee generally sets executives' base salaries at or near 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 Subcommittee 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> 22
The amount of annual bonus incentive awards for 1998 was determined by
reference to pre-established financial performance goals, notably the Company's
actual 1998 financial results which exceeded the 1998 targets for return on
capital, net income and earnings per share. In addition to weighing financial
performance, the Subcommittee considered favorably the strategic actions taken
in 1998 including the successful divestiture of Matthew Bender & Company,
Incorporated and Mosby, Inc.
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 Subcommittee's
consideration in setting the 1998 compensation of Mr. Willes was strongly
influenced by the improvement in return on capital and earnings per share
experienced by the Company during 1997 and by the Company's achievement of
certain strategic initiatives during 1997. In 1998, the Subcommittee set Mr.
Willes' base compensation for 1998 at $900,000. In February 1999, the
Subcommittee awarded Mr. Willes a bonus of $2,025,000 with respect to 1998
performance. In 1998, the Subcommittee granted him options on 200,000 shares of
Series A Common Stock with an exercise price of $58.0312 (the stock's market
price on the date of grant) as part of his compensation for 1998. In taking such
actions, the Subcommittee also considered Mr. Willes' success in the continued
revitalization of the Company and in incenting its executives to achieve
significant internal growth. In addition, the Subcommittee amended Willes'
retirement arrangement to base his retirement benefit more fully on his
compensation with Times Mirror.
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 $1,000,000 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 Subcommittee 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
$1,000,000 in any one year, except for compensation payments in excess of
$1,000,000 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, in limited circumstances, certain compensation
paid by the Company may not be, and in 1998 was not, deductible.
<TABLE>
<S> <C>
Clayton W. Frye, Jr., Dr. Alfred E. Osborne, Jr.
Chairman
Donald R. Beall Dr. Edward Zapanta
</TABLE>
18
<PAGE> 23
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 STOCK INDEX AND PEER GROUP
<TABLE>
<CAPTION>
TIMES MIRROR (2) S&P 500 STOCK INDEX PEER GROUP (3)
---------------- ------------------- --------------
<S> <C> <C> <C>
'1993' 100 100 100
'1994' 97 101 95
'1995' 156 139 119
'1996' 231 171 143
'1997' 289 229 225
'1998' 266 294 244
</TABLE>
- ---------------
(1) Assumes $100 invested on December 31, 1993 in the common stock of Times
Mirror, the S&P 500 Stock 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> 24
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 10 15 20 25
-------------------- -------- -------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C>
$ 300,000............... $ 26,250 $ 52,500 $ 78,750 $ 105,000 $ 131,250
400,000............... 35,000 70,000 105,000 140,000 175,000
500,000............... 43,750 87,500 131,250 175,000 218,750
600,000............... 52,500 105,000 157,500 210,000 262,500
700,000............... 61,250 122,500 183,750 245,000 306,250
800,000............... 70,000 140,000 210,000 280,000 350,000
900,000............... 78,750 157,500 236,250 315,000 393,750
1,000,000............... 87,500 175,000 262,500 350,000 437,500
1,250,000............... 109,375 218,750 328,125 437,500 546,875
1,500,000............... 131,250 262,500 393,750 525,000 656,250
1,750,000............... 153,125 306,250 459,375 612,500 765,625
2,000,000............... 175,000 350,000 525,000 700,000 875,000
2,250,000............... 196,875 393,750 590,625 787,500 984,375
2,500,000............... 218,750 437,500 656,250 875,000 1,093,750
2,750,000............... 240,625 481,250 721,875 962,500 1,203,125
3,000,000............... 262,500 525,000 787,500 1,050,000 1,312,500
</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 which
is generally up to a maximum of 30 years. 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 beneficiary 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, income from exercises of
stock options 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 1998 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, 1998 were approximately 3 years for Mr. Willes, 6 years for Mr.
Unterman, 21 years for Mr. Wright, 5 years for Ms. Junck and 3 years for Ms.
Downing.
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 ($130,000 in 1998) 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
20
<PAGE> 25
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 $9,837 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 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,
1998 were as follows: 721 shares for Mr. Unterman and 5,817 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. Prior to 1998, the Compensation Committee designated all the
named officers on page 13 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 participant dies, his or her
beneficiary 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, Roger Goodan 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 and Judy C. Webb
are cousins of each of the directors named above (other than Mr. Stinehart).
Douglas Goodan is the uncle of Roger Goodan and is the cousin of the other
directors named above (other than Mr. Stinehart and Roger Goodan). The trustees
(other than Mr. Stinehart) and other of their relatives are beneficiaries of the
Chandler Trusts. The Chandler
21
<PAGE> 26
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.
In forming the new limited liability company, the Company contributed real
property having an appraised value of $226,000,000 and $249,000,000 in cash. The
Chandler Trusts contributed approximately 5 million shares of Series A Common
Stock, valued at $254,000,000, and $221,000,000 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 $19,333,000 of the lease payments and $4,261,000 of dividends
received on the Company's stock by the limited liability company in 1998 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 $190,000,000 stated value of 8% Series A Preferred Stock
and $21,000,000 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
$313,000,000 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 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. The agreement provided 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 18 years of service) offset by the benefit he earned
under the pension plans maintained by his former employer or (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 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.
On July 15, 1998, the Company entered into an agreement with Ms. Downing
that after she transferred to the Los Angeles Times, the Company would pay her
$50,000 per year, less appropriate withholding, to assist
22
<PAGE> 27
her relocation to Southern California. This amount is to be paid to her in an
annual lump sum payment for each of the next five years. The first payment was
made as of July 1, 1998, and future payments will be made as of the next four
anniversaries from that date. These payments will be reduced for appropriate tax
withholding but will not be grossed up for taxes. These payments will cease in
the event that her employment with the Company terminates during the five-year
period.
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 1998.
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.
2000 ANNUAL MEETING
Shareholder proposals submitted pursuant to Rule 14a-8 under the Securities
Exchange Act of 1934 must be received by the Company on or before November 27,
1999 to be considered for inclusion in the proxy statement for the 2000 Annual
Meeting of Shareholders, which is expected to be held on May 4, 2000. Under the
Company's Restated Certificate of Incorporation, any nomination or proposal not
submitted pursuant to Rule 14a-8 must be received not before March 5, 2000 and
not after April 4, 2000 and must comply with, among other things, the
requirements of the Company's Restated Certificate of Incorporation. If the
shareholder does not also comply with the requirements of Rule 14a-4 under the
Securities Exchange Act of 1934, the Company may exercise discretionary voting
authority under proxies it solicits to vote in accordance with its best judgment
on any such proposal submitted by a shareholder.
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
solicitation, for which they will receive no additional compensation.
Stephen C. Meier
Secretary
March 26, 1999
23
<PAGE> 28
LOGO
LOGO
Printed on recycled paper.
<PAGE> 29
PROXY PROXY
[LOGO] TIMES MIRROR
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS -- MAY 6, 1999
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 Costa Mesa, California on May 6, 1999 at 10:00 a.m., or at any
adjournment or postponement thereof, upon such business as may properly come
before the meeting or at any adjournment or postponement 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)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE> 30
TIMES MIRROR
IMPORTANT: PLEASE MARK BOXES TO GIVE VOTING INSTRUCTIONS (SEE NOTE BELOW) [X]
1. ELECTION OF DIRECTORS -- Nominees:
CLASS I: 01 - Donald R. Beall, 02 - Sherry L. Lansing,
03 - Dawn Gould Lepore, 04 - Robert W. Schult
and 05 - Warren B. Williamson
For Withheld For All
All All Except _________________________________
[ ] [ ] [ ] Nominee Exceptions
2. Ratifying the appointment of For Against Abstain
Ernst & Young LLP as [ ] [ ] [ ]
Independent Auditors for the
Company and its subsidiaries.
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 this proxy.
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: ___________________________, 1999
________________________________________
(Signature)
________________________________________
(Signature if held jointly)
[ ] I PLAN TO ATTEND THE MEETING.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
CONTROL NUMBER [LOGO] 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> 31
PROXY PROXY
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS -- MAY 6, 1999
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 6, 1999 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 TRUSTEE
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: Trustee 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)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
<PAGE> 32
TIMES MIRROR
IMPORTANT: PLEASE MARK BOXES TO GIVE VOTING INSTRUCTIONS (SEE NOTE BELOW) [X]
1. ELECTION OF DIRECTORS -- Nominees:
CLASS I: 01 - Donald R. Beall, 02 - Sherry L. Lansing,
03 - Dawn Gould Lepore, 04 - Robert W. Schult
and 05 - Warren B. Williamson
For Withheld For All
All All Except _________________________________
[ ] [ ] [ ] Nominee Exceptions
2. Ratifying the appointment of For Against Abstain
Ernst & Young LLP as [ ] [ ] [ ]
Independent Auditors for the
Company and its subsidiaries.
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 Trustee. 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.
Dated: ___________________________, 1999
________________________________________
Please sign exactly as imprinted at left
[ ] I PLAN TO ATTEND THE MEETING.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
CONTROL NUMBER [LOGO] 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.
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.
