Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K Knight-Ridder, Inc. Form 10-K 12-31-95 47 270K
2: EX-10 Local Incentive Plan 4± 15K
3: EX-11 Computation of Per Share Earnings 2± 10K
4: EX-12 Computation of Earnings to Fixed Charges Ratio 1 8K
5: EX-21 Subsidiaries of the Registrant 3± 14K
6: EX-23 Consent of Ernst & Young LLP 1 6K
7: EX-24 Power of Attorney for James I. Cash, Jr. 1 6K
8: EX-27 Financial Data Schedule 2± 8K
EX-10 — Local Incentive Plan
KNIGHT-RIDDER, INC. EXHIBIT 10
LOCAL INCENTIVE PLAN
ELIGIBILITY
Employees of the corporate office who are at the director level and who are not
participating in the Knight-Ridder Annual Incentive Plan.
PLAN PROVISIONS
Effective January 1, 1995, the local incentive plan will provide eligible
employees with an opportunity to earn up to an additional 10% of their annual
salary based on their achievement in meeting certain goals each Plan Year
(1/1-12/31).
PERFORMANCE MEASURES AND THEIR WEIGHTINGS
Each participants bonus will be based on two types of measures: how well the
individual performed relative to his or her goals for the year ("Personal
Performance"); and how well the company performed relative to financial goals
for the year ("Financial Performance").
Eighty percent (80%) of each participant's potential award will be based on
Personal Performance, and twenty percent (20%) will be based on the Financial
Performance of the company.
PERFORMANCE MEASUREMENT
FINANCIAL PERFORMANCE MEASURES
Financial performance will be evaluated relative to budgeted goals set at the
beginning of the Plan Year. The financial performance measure will be
operating profit. A participant can earn a maximum of 20 points based on
financial results.
PERSONAL PERFORMANCE MEASURES
Personal performance will be evaluated relative to individual goals established
at the beginning of the calendar year and agreed upon by the participant, the
participant's manager and appropriate division head. A participant can achieve
a maximum of 80 points based on personal performance.
The goals set should be:
- no more than six to eight with one goal of 10 point value automatically
assigned to leadership/management effectiveness.
- "stretch" goals. That is, they should be challenging goals that are over
and above the normal course of doing one's job.
- measurable as to what is to be accomplished and how results will be
assessed. For example, by June 1 the error rate will be reduced by 10%.
- each goal will be given a weight, based on its relative importance, with
the combined weightings equaling 80.
At the end of the year, each participant's manager will evaluate performance on
each goal relative to the objectives, determine the degree to which the goal
was achieved and assign it a number of points. For example, if a goal was
weighted 10 points and half of it was achieved, it would receive five points.
The points received on all goals will be added to determine the total rating,
up to a maximum of 80 points.
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DETERMINING AND PAYING AWARDS
Each participant's award will be determined by adding together the award earned
based on Financial Performance and the award earned based on Personal
Performance. An award may be paid for one type of measure even if no award was
earned for the other type of measure. The only constraint is that a corporate
performance threshold must be achieved for any award to be payable. Normally
this threshold requirement will be that corporate operating income, as reported
in the Annual Report, must equal at least 80% of prior year operating income,
although the Compensation Committee reserves the right to adjust the threshold.
For Personal Performance, the award is determined by how many of the 80 total
Personal Performance points were earned by the individual. The number of
points earned translates into the percentage of the total potential award
payable. For instance, 80 points translates into 80% of the individual's total
potential award which is 10% of his or her salary.
Financial Performance works much the same way. However, the number of points
earned is determined by actual company financial results compared to budgeted
results. Points awarded can vary from zero to 20 using the following schedule:
- If actual financial results are equal to or over budget, all 20 points
of the Financial Performance award will be paid.
- If actual financial results are at or below 90% of budgeted results,
no award will be paid for Financial Performance.
- If actual financial results are above 90% of budget, but below 100% of
budget, then the points awarded will be less than the amount payable
for meeting budget, with each 1% shortfall in performance versus
budget resulting in a 2 point reduction of the amount payable for
meeting budget, as follows:
[Download Table]
ACTUAL POINTS ACTUAL POINTS
VS. BUDGET AWARDED VS. BUDGET AWARDED
---------- ------- ---------- -------
100% 20 94% 8
99% 18 93% 6
98% 16 92% 4
97% 14 91% 2
96% 12 90% 0
95% 10
The points earned on Personal Performance and those earned on Financial
Performance should be tallied together to determine what percentage of the
total potential award has been earned.
Awards will be paid in cash following the end of the calendar year and the
computation of results. Required tax amounts will be withheld.
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EXAMPLES OF DETERMINING AWARD PAYMENT
EXAMPLE 1: SALARY INCREASE WITHIN THE YEAR
- Salary Earned: 1/1 - 6/30 $30,000
- Salary Earned: 7/1 - 12/31 $35,000
-------
Total Salary $65,000
- Award Opportunity: $ 6,500 Total (10% of salary)
- Actual Award:
[Download Table]
-Personal Performance: 70 points out of 80 achieved = (70% of $6,500) = $4,550
-Financial Performance: 20 points out of 20 achieved* = (20% of $6,500) = 1,300
------
TOTAL AWARD PAYABLE $5,850
*100% of budget achieved
EXAMPLE 2: SAME SALARY THROUGHOUT THE YEAR
- Salary Earned: 1/1 - 12/31 $80,000
- Award Opportunity: $ 8,000 Total (10% of salary)
- Actual Award:
[Download Table]
-Personal Performance: 60 points out of 80 achieved = (60% of $8,000) = $4,800
-Financial Performance: 10 points out of 20 achieved* = (10% of $8,000) = 800
------
TOTAL AWARD PAYABLE $5,600
*95% of budget achieved
EXAMPLE 3: INDIVIDUAL IS PROMOTED TO A DIRECTOR LEVEL POSITION ON JULY 1 AND
IS ELIGIBLE FOR THE LOCAL INCENTIVE PLAN FOR THE REMAINDER OF THE YEAR.
- Salary Earned: 7/1 - 12/31 $35,000
- Award Opportunity: $ 3,500 (10% of salary)
- Actual Award:
[Download Table]
-Personal Performance: 80 points out of 80 achieved = (80% of $3,500) = $2,800
-Financial Performance: 16 points out of 20 achieved* = (16% of $3,500) = 560
------
TOTAL AWARD PAYABLE $3,360
*98% of budget achieved
50
Dates Referenced Herein
| This ‘10-K’ Filing | | Date | | Other Filings |
|---|
| |  |
| Filed on: | | 3/20/96 | | None on these Dates |
| For Period End: | | 12/31/95 |
| | 1/1/95 |
| List all Filings |
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