remain exercisable for the original term of the award for all
former directors. Following are the stock option holdings of
each of Belo’s non-employee directors as of
December 31, 2007:
Outstanding
Exercisable
Name
Stock Options
Stock Options
Henry P. Becton, Jr.
95,867
90,194
Louis E. Caldera
50,113
44,440
Douglas G. Carlston
5,134
—
France A. Córdova, Ph.D.(4)
29,535
29,535
Judith L. Craven, M.D., M.P.H
72,310
66,637
Dealey D. Herndon
72,310
66,637
Laurence E. Hirsch
147,573
130,555
Wayne R. Sanders
35,208
29,535
William T. Solomon
72,560
66,887
M. Anne Szostak
25,409
19,736
Lloyd D. Ward
65,023
59,350
J. McDonald Williams
99,789
94,116
(3)
Doug Carlston was appointed to Belo’s Board effective
July 26, 2007. He was awarded a proportionate share of the
standard annual compensation package, comprised of 50% cash, 25%
stock options for Belo Series B common stock and 25%
TBRSUs. Doug’s option and RSU awards will vest on the date
of the May 2008 annual meeting of Belo shareholders.
(4)
As described above, France Córdova resigned from the Board
in July 2007.
Director
Compensation for 2008
The non-employee directors of Belo after the spin-off will
receive the same retainer package for 2008 as was in effect for
2007. For 2008, Robert Decherd, in his new role as non-executive
Chairman of the Belo Board and Henry Becton, in his new role as
Lead Director, will receive an additional $60,000 and $30,000,
respectively, in cash for such added responsibilities.
Certain
Relationships
Belo has a written Code of Business Conduct and Ethics. One
policy in the Code provides that all directors, officers, and
employees avoid business and personal situations that may give
rise to a conflict of interest. A “conflict of
interest” under the Code occurs when an individual’s
private interest interferes or appears to interfere with
Belo’s interest. The Code provides that the Audit Committee
(or its designee) is generally responsible for enforcement of
the Code relating to members of the Board of Directors; and the
Company’s Management Committee (or its designee) is
generally responsible for enforcement of the Code relating to
officers and employees.
The Board has adopted a written related person transaction
policy and procedures pursuant to which significant transactions
involving the Company and related persons, as defined in
Item 404(a) and accompanying instructions of
Regulation S-K,
are subject to review by the Nominating and Corporate Governance
Committee. In determining whether to approve or ratify a related
person transaction, the Nominating and Corporate Governance
Committee will take into account, among other factors it deems
appropriate, whether the related person transaction is on terms
no less favorable than terms generally available to an
unaffiliated third party under the same or similar circumstances
and the extent of the related person’s interest in the
transaction.
Effective October 1, 2005, the Company entered into a
construction contract with Austin Commercial, L.P. relating to
the new
Dallas Morning News
South Plant. As of
September 30, 2007, all amounts relating to the contract
had been paid and the contract completed. The contract provided
for total payments of approximately $16.5 million, of which
approximately $2,335,000 was paid during 2007. Bill Solomon, who
will retire as a member of the Belo Board on the date of the
2008 annual meeting of shareholders, is non-executive chairman
of the Board of Austin
Industries, Inc., the parent company of Austin Commercial, L.P..
This transaction was reviewed and approved in advance by the
Board’s Audit Committee in accordance with the
above-referenced policies, as then applicable.
Robert Decherd’s son, William Decherd, was employed by Belo
from August 2005 to July 2007, when he became a full-time
student at the Stanford Graduate School of Business to pursue an
advanced degree. In 2006, William was promoted to product
development director and previously served as product
development manager. William also staffed Belo’s
enterprise-wide strategy and business development activities.
Prior to joining Belo, William worked in an analyst role for The
Goldman Sachs Group, Inc., McKinsey & Company, and
Hicks, Muse, Tate & Furst Incorporated (now known as
HM Capital Partners LLC), a Dallas-based private equity firm.
William’s compensation for 2006 was $160,882, consisting of
base salary and a performance bonus under Belo’s management
compensation plan. His base salary for 2007 was $165,000 and he
received a pro rated performance bonus based on Belo’s 2007
financial results. William’s employment with Belo was
discussed with Belo’s Board in advance of his joining Belo.
William’s 2006 compensation was reviewed and approved by
the Company’s executive vice president and the senior vice
president/Human Resources, and his 2007 compensation was
reviewed and approved by the president/Media Operations and the
senior vice president/Human Resources, in both cases in
accordance with Belo’s normal management compensation
process and the procedures referenced above.
In connection with the spin-off, Belo and A. H. Belo entered
into a Separation and Distribution Agreement, a Services
Agreement, a Tax Matters Agreement and an Employee Matters
Agreement, effective as of the distribution date. Belo’s
Dallas/Fort Worth television station,
WFAA-TV,
and
The Dallas Morning News
, owned by A. H. Belo, entered
into agreements whereby each agrees to provide media content,
cross-promotion and other services to the other on a mutually
agreed-upon
basis. Robert Decherd is chairman of the Board, president and
Chief Executive Officer of A. H. Belo, and chairman of the Board
of Belo. Jim Moroney, executive vice president of A. H. Belo and
Publisher and Chief Executive Officer of
The Dallas Morning
News
, is an executive officer of A. H. Belo and a director
of Belo. Dealey Herndon is a director of both Belo and A. H.
Belo.
The Company is not aware of any other related person
transactions that would require disclosure.
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