ITEM 3. Legal Proceedings
In 1990, a verdict was rendered against the company's subsidiary, Philadelphia Newspapers, Inc., (PNI), publisher of The Philadelphia Inquirer and Philadelphia Daily News, in a libel action entitled Sprague v. Philadelphia Newspapers, Inc., for $2.5 million in compensatory damages and $31.5 million in punitive damages. Following entry of the judgment on Sept. 15, 1992, PNI, as required by statute, posted a bond equal to 120% of the amount of the verdict and appealed the judgment to the Pennsylvania Superior Court. PNI believes that substantial grounds exist for a decision by an appellate court to reverse the trial court and remand the case for a new trial. The Comprehensive Environmental Response, Compensation and Liability Act (Superfund) establishes a fund to clean up deposits and spills of hazardous substances. The Company has been identified by certain regulatory agencies as one of several potentially responsible parties in connection with the generation of allegedly hazardous substances which may have been disposed of or reclaimed by third-party contractors at sites in New Jersey, Maryland, South Carolina, North Carolina, Pennsylvania, and Kansas. The Company, certain other potentially responsible parties and the United States Environmental Protection Agency (EPA) have entered into consent orders relating to the sites in New Jersey, South Carolina and North Carolina providing for remedial investigations and feasibility studies or remediation to be performed.
The Company does not anticipate that any liability arising from ultimate relief secured by regulatory agencies or other persons will have a material effect on the Company's business or financial condition. The Company is cooperating with the appropriate regulatory agencies with respect to compliance with environmental laws.
ITEM 4.

ITEM 4. Submission of matters to a vote of security holders
None. PART II ITEM 5.

ITEM 5. Market for registrant's common stock and related stockholder matters -------------------------------------------------------------------- KRI STOCK Knight-Ridder common stock is listed on the New York Stock Exchange and the Frankfurt Stock Exchange under the symbol KRI and on the Tokyo Stock Exchange with the designation 9491. The stock also is traded on exchanges in Philadel- phia, Chicago, Boston, San Francisco, Los Angeles and Cincinnati, as well as through the Intermarket Trading System. Options are traded in the Philadel- phia Exchange.
ITEM 6.

ITEM 6. Selected Financial Data -----------------------
ITEM 7.

ITEM 7. Management's Discussion and Analysis of Financial Condition ----------------------------------------------------------- and Results of Operations -------------------------
Knight-Ridder is an international information and communications company engaged in newspaper publishing, business news and information services, electronic retrieval services and news, graphics and photo services. In 1993, the gross revenue from these businesses was almost $2.5 billion. The company also is involved in other newspaper businesses, cable television and newsprint manufacturing through business arrangements, including joint ventures and partnerships. The charts at the end of this section illustrate the approximate relative percentages of the components of operating revenue and of operating costs as a percentage of revenue.
Glossary of Newspaper Advertising Terms The following definitions may be helpful when reading the Discussion and Analysis of Operations. RETAIL - display advertising from local merchants, such as department and grocery stores, selling goods and services to the public. GENERAL - display advertising by national advertisers who promote products or brand names on a nationwide basis. CLASSIFIED - small, locally placed ads listed together and organized by category, such as real estate sales, employment opportunities and automobile sales and display-type advertisements in these categories. FULL-RUN - advertising appearing in all editions of a newspaper. PART-RUN - advertising appearing in select editions or zones of a newspaper's market. Part-run advertising is translated into full-run equivalent linage (referred to as factored) based on the ratio of the circulation in a particular zone to the total circulation of a newspaper. RUN-OF-PRESS (ROP) - all advertising printed on Knight-Ridder presses and appearing within a newspaper. PREPRINT - advertising supplements prepared by advertisers and inserted into a newspaper.
NEWSPAPER revenue is derived principally from advertising and newspaper copy sales. Newspaper advertising currently accounts for 60% of consolidated revenue. This revenue comes from the three basic categories of advertising - retail, general and classified - discussed above. Newspaper advertising volume is categorized as either run-of-press (ROP) or preprint. Volume for ROP advertising is measured in terms of either full-run or part-run advertising linage and reported in six-column inches. A six-column inch consists of one inch of advertising in one column of a newspaper page when that page is divided into six columns of equal size. By using part-run advertising, advertisers can direct their messages to selected market segments. Circulation revenue results from the sale of newspapers. Circulation of daily and Sunday newspapers currently accounts for 19% of consolidated revenue. It is reported at the net wholesale price for newspapers delivered or sold by independent contractors and at the retail price for newspapers delivered or sold by employees. Other newspaper revenue comes from alternate delivery systems, commercial job printing, newsprint scrap sales, newspaper trucking services, book publishing, niche publications and other miscellaneous sources. BUSINESS INFORMATION SERVICES (BIS) revenue includes operations of Dialog, Knight-Ridder Financial and the Journal of Commerce. Dialog includes Dialog Information Services and Data-Star, a 1993 acquisition with Europe-based online operations. Dialog and Data-Star have more than 155,000 customers in over 100 countries and offer more than 450 databases. Subscribers are charged according to the amount of time they spend online and which databases they access. Knight-Ridder Financial products include real-time and archival information services focusing on global sovereign debt, foreign exchange, money markets and futures instruments. Information displayed on these products consists of news, quotations, charts and a variety of other analytical services. The group generates revenue from subscribers in more than 30 countries. The Journal of Commerce publishes The Journal of Commerce, a business daily newspaper that focuses on global trade and transportation issues, and several more-targeted periodicals. It also provides access to electronic databases on imports, exports and steamship tariffs. SUMMARY OF OPERATIONS: A summary of the company's operations, certain share data and other financial data for the past 11 years is provided in Item 6. Compound growth rates for the past five- and 10-year periods are also included, if applicable. A review of this summary and of the
Supplemental Information section (Items 1 & 2) will provide a better understanding of the following discussion and analysis of operating results and of the financial statements as a whole. The Supplemental Information section contains financial data for the company's operations by line of business and includes discussions of the company's largest newspapers and information regarding the company's properties, technology and the raw materials used in operations. RESULTS OF OPERATIONS: 1993 vs. 1992 - Knight-Ridder, Inc., earnings per share was $2.68, up $.03, or 1.1%, from $2.65 per share before the cumulative effect of changes in accounting principles in 1992. Operating income increased 2.3% on a 5.2% increase in revenue in 1993. Operating income as a percentage of revenue was 11.6% compared with 12.0% in 1992. A 20.7% increase in net interest expense resulted from a reduction in capitalization of interest related to the Philadelphia plant. This was partially offset by higher earnings from our cable investment. NEWSPAPERS: The Newspaper Division's operating income increased $8.2 million, or 2.8%, to $298.8 million. The increase resulted from improved revenues that more than offset a 3.4% increase in the average price of newsprint, and increased costs due to the transition to the new plant in Philadelphia. Overall, newspaper advertising revenue increased by $37.5 million, or 2.6%, in 1993 on a full-run ROP linage increase of 1.3%. The following table summarizes the percentage change in revenue and full-run ROP linage from 1992. Percent Percent Gain Gain (Decline) (Decline) in Full-Run Advertising Category in Revenue ROP Linage - -------------------- ---------- ---------- Retail 1.0 (1.0) General (3.4) (7.8) Classified 7.0 5.3 Total 2.6 1.3
Retail advertising revenue improved $7.6 million, or 1.0%. A 1.9% increase in full-run average rates and an increase in part-run ROP revenue was partially offset by a 1.0% decrease in full-run ROP linage.
General advertising revenue declined by $6.0 million, or 3.4%, from 1992 on a 7.8% decline in full-run ROP general linage, partially offset by an increase in preprint revenue. General advertising revenue did show year-over-year improvement in the fourth quarter of 1993. Classified revenue improved by $35.9 million, or 7.0%, on a 5.3% increase in full-run ROP volume. Circulation revenue increased $14.4 million, or 3.1%, despite a decline in average number of copies. Morning circulation declined 11,300 copies, or 0.4%, and afternoon circulation declined 11,800 copies, or 2.5%. Sunday circulation declined 14,300 copies, or 0.3%. Other newspaper revenue increased $16.8 million, or 42.2%, during 1993, primarily due to efforts to augment the revenue of our core newspaper business. BUSINESS INFORMATION SERVICES: In 1993, BIS contributed 17.9% of consolidated revenue, compared with 16.5% in 1992. Operating income was $23.4 million, up $1.3 million, or 6.1%, from 1992 on a 13.8% increase in revenue. About half of the revenue growth was due to the first-quarter acquisition of Data-Star. Excluding Data-Star revenue, BIS revenue was up 6.5% from the prior year. The graph at the end of this section illustrates the 22.4% compound growth rate for BIS revenue from 1983. EXPENSES: Labor and employee benefit costs were up $33.9 million, or 3.4%, with 141, or 0.7%, more employees resulting from expansion and acquisitions in the BIS division. The average wage per employee increased 3.9%. Included in 1992 results were $10.5 million in severance and buyout costs related to a Detroit joint operating agreement (JOA) labor settlement. Newsprint, ink and supplements cost increased by $18.2 million, or 5.8%, due to a 3.4% increase in both consumption and average newsprint prices from the prior year. Depreciation and amortization expense increased 10.6%, or $13.5 million, due to the completion of the new Philadelphia printing plant and BIS expansion. Other operating costs increased 8.1% from 1992 due partially to a $21.7 million increase in volume-related BIS royalty and exchange fee expenses. NON-OPERATING ITEMS: Net interest expense increased $6.7 million, or 20.7%, from 1992 as a result of the $14.6 million reduction in capitalized interest. This was partially offset by a reduction of interest expense reserves related to prior year tax audits and the call of $100.0 million of 8.0% notes, replaced by lower-rate commercial paper. Average interest rates on commercial paper decreased from 4.3% in 1992 to 3.2% in 1993.
Other non-operating items improved to a $2.2 million loss, a $4.1 million improvement from 1992. Most of the improvement came from our cable investment, which this year contributed an additional $3.5 million to our pretax income. INCOME TAXES: The effective income tax rate for 1993 was 39.2%, up 0.1% from 39.1% in 1992. Income tax expense included the $5.1 million unfavorable effect of the retroactive and current impact of the tax rate change in the Omnibus Budget Reconciliation Act of 1993. It was mostly offset by favorable adjustments of tax reserves and deferred tax assets resulting from settlement of IRS audits of prior years and resolution of other state tax issues. RESULTS OF OPERATIONS: 1992 vs. 1991 - Knight-Ridder, Inc., earnings per share before the cumulative effect of changes in accounting principles was $2.65, up $.10, or 3.9%, from $2.55 per share in 1991. The company recorded a non-recurring net charge of $105.2 million ($1.91 per share) related to the adoption of Financial Accounting Standards (FAS) 106 (Postretirement Benefits Other Than Pensions) and FAS 109 (Accounting For Income Taxes). The cumulative effect of adoption of FAS 106, relating to postretirement benefits other than pensions, was an after-tax reduction in earnings of $131.0 million, or $2.37 per share. This represents the unrecognized net obligation based on plans in place at the beginning of 1992. The company chose to recognize this "transition" amount immediately, rather than prospectively. In the second quarter, the company announced medical plan changes effective Jan. 1, 1993, that placed a maximum annual dollar cap for medical premiums that the company would pay for most future non-union retirees. Additionally, coverage after the age of 65 was eliminated for most future non-union retirees. The result of this announced plan change was a reduction in the prior service cost, which will be amortized over future years. The full-year operating profit reduction resulting from the recurring additional costs related to FAS 106 was $6.6 million, or an after-tax $.07 reduction in earnings per share. The adoption of FAS 109, which relates to accounting for deferred income taxes, resulted in an increase to 1992 net income of $25.8 million, or almost $.47 per share. Operating income increased 14.5% on a 3.2% increase in revenue in 1992. Operating income as a percentage of revenue improved to 12.0% from 10.8% in 1991. Revenue gains and a decline in the cost of newsprint contributed positively to operating income. A decline in net interest expense and higher earnings from our cable investment helped to offset the decline in earnings from our newsprint manufacturing investments.
NEWSPAPERS: The Newspaper Division's operating income increased $30.9 million, or 11.9%, to $290.5 million. The increase resulted from improved revenue and a decline in the cost of newsprint. Newspaper Division operating costs increased $9.3 million. Overall, newspaper advertising revenue increased by $14.5 million, or 1.0%, in 1992 on a full-run ROP linage decline of 1.5%. The following table summarizes the percentage change in revenue and full-run ROP linage from 1991.
Percent Percent Gain Gain (Decline) (Decline) in Full-Run Advertising Category in Revenue ROP Linage - -------------------- ---------- ----------- Retail (0.1) (2.8) General 1.0 (7.9) Classified 2.7 1.1 Total 1.0 (1.5)
Retail advertising revenue was down $520,000, or 0.1%. A 2.8% decline in volume was partially offset by a 1.5% increase in full-run average rates and an increase in preprint and part-run revenue. General advertising revenue increased by $1.8 million, or 1.0%, from 1991 on the strength of an 8.2% increase in rates and an increase in preprint and part-run revenue. General full-run ROP linage declined 7.9% from 1991. Classified revenue improved by $13.2 million, or 2.7%, on a 1.1% increase in full-run ROP volume and a 1.7% increase in full-run average rates. Circulation revenue increased $21.0 million, or 4.8%, due to a 6.4% increase in average rates. Morning circulation declined 26,400 copies, or 0.8%, and afternoon circulation declined 40,900 copies, or 7.9%. Sunday circulation declined 7,200 copies, or 0.2%. BUSINESS INFORMATION SERVICES: In 1992, BIS contributed 16.5% of consolidated revenue, compared with 15.7% in 1991. Operating income was $22.1 million, up $1.9 million, or 9.3%, from 1991 on an 8.8% increase in revenue. EXPENSES: Labor and employee benefit costs were up $47.9 million, or 5.1%, with 83, or 0.4%, fewer employees. The average wage per employee increased 5.2%. Included in 1992 results were $10.5 million in severance and buyout costs related to a Detroit JOA labor settlement in the first half of the year.
Newsprint, ink and supplements cost declined by $63.0 million, or 16.6%, due to a 17.8% decrease in average newsprint prices from the prior year. Newsprint consumption was 0.1% less than 1991 as a result of shifting the printing of the Journal of Commerce to an outside company. Supplements cost decreased by $4.8 million, or 10.6%. Depreciation and amortization expense increased 3.4%, or $4.2 million, due to the start-up of the new Philadelphia printing plant and BIS expansion. Other operating costs increased 8.3% from 1991 due partially to an $11.8 million increase in volume-related BIS royalty and exchange fee expenses, and increased circulation promotion costs. Additionally, Knight-Ridder increased its level of contributions to help with the aftermath of Hurricane Andrew. NON-OPERATING ITEMS: Net interest expense declined $7.7 million, or 19.2%, from 1991 as a result of lower average debt balances and lower interest rates. Average interest rates on commercial paper decreased from 6.4% in 1991 to 4.3% in 1992. Other non-operating items decreased to a $6.2 million loss, a $13.6 million decline from 1991. The major reason for the decline was unfavorable results from our investments in newsprint manufacturing, which suffered from soft newsprint prices in 1992. Our cable investments performed well, but this was not enough to offset other non-operating losses. INCOME TAXES: The effective income tax rate for 1992 was 39.1%, up 1.9% from 1991's 37.2% as a result of the resolution of prior year tax issues. RESULTS OF OPERATIONS: 1991 vs. 1990 - Knight-Ridder, Inc., earnings per share from continuing operations for 1991 of $2.55 was down $.39, or 13.3%, from $2.94 per share in 1990. The serious impact of the recession and the effects of the war in the Middle East early in the year resulted in our first down year after 15 consecutive years of earnings per share growth, excluding the impact of gains from major asset sales. Operating income from continuing operations decreased 19.1% on a 2.9% decrease in revenue in 1991. Operating income as a percentage of revenue was 10.8%, compared with 12.9% in 1990. Gains in the Business Information Services Division and a decline in total newsprint expense contributed positively to operating income, but were not enough to offset the softness in advertising revenue. A decline in net interest expense and higher earnings from investments in cable and newsprint manufacturing also helped offset the decline in operating income. NEWSPAPERS: The Newspaper Division's operating income decreased $64.2 million, or 19.8%, to $259.6 million. The decrease resulted from the
cyclical weakness in advertising revenue being experienced throughout the newspaper industry and other advertising media. Newspaper Division operating costs decreased 1.4%. Overall, newspaper advertising revenue declined by $127.3 million, or 8.2%, in 1991 on a full-run ROP linage decline of 9.4%. The following table summarizes the percentage changes in revenue and full-run ROP linage from 1990. Percent Percent Decline Decline in Full-Run Advertising Category in Revenue ROP Linage - -------------------- ---------- ----------- Retail (4.1) (8.6) General (6.8) (12.5) Classified (14.1) (10.0) Total (8.2) (9.4)
Retail advertising revenue was down $32.8 million, or 4.1%. An 8.6% decline in volume was partially offset by a 2.7% increase in full-run average rates and an increase in preprint revenue. The retail linage decline reflected the weakened condition of the retail industry and the economy in general. General advertising revenue declined $12.6 million, or 6.8%, from 1990. The volume decrease of 12.5% was slightly offset by a 3.9% increase in full-run average rates and greater volume in preprints. The continued decline in full-run ROP volume reflected softness in airline, food and factory automotive advertising. Classified revenue declined $81.9 million, or 14.1%, on a 10.0% drop in full-run ROP volume and a 4.8% decrease in full-run average rates. Almost every market was affected, with the biggest losses coming in the employment category. Employment revenue was down 24.4% on a 30.7% volume decrease, with the biggest losses in San Jose and Philadelphia. Real estate revenue dropped 13.8% on a 12.9% decline in linage. Automotive revenue was down 6.3% on a 0.3% decrease in volume. Circulation revenue increased $35.8 million, or 8.9%, due to a 12.0% increase in average rates. Morning circulation declined 12,000 copies, or 0.4%. Afternoon circulation declined 115,000 copies, or 18.2%. Sunday circulation declined 26,000 copies, about the same percentage reduction experienced in weekday morning circulation.
BUSINESS INFORMATION SERVICES: In 1991, BIS contributed 15.7% of consolidated revenue, compared with 14.3% in 1990. While the company reinvested significant profits in the development of this division, operating income was $20.2 million, up $3.0 million, or 17.3%, from 1990 on a 6.5% increase in revenue. Dialog and MoneyCenter accounted for most of the revenue increases as a result of increases in the number of customers served. EXPENSES: Labor and employee benefit costs were up $12.5 million, or 1.3%, with 3.5% fewer employees. The average wage per employee increased 3.5%. Additionally, 1991 includes $14.3 million of severance and early retirement costs incurred in the second half of the year by several newspapers, designed to streamline operations and further reduce costs in future years. Excluding these buyout costs from 1990 and 1991, total labor costs were almost flat and employee benefits increased $6.7 million, or 3.8%. Newsprint, ink and supplements cost decreased $22.4 million, or 5.6%, due to a 7.3% decrease in consumption partially offset by a 1.5% increase in average newsprint prices. The reduced consumption reflected the lower volume in advertising linage and circulation. Supplements cost decreased by $2.8 million, or 5.9%. Other operating costs decreased 0.2% from 1990 due to strong efforts to control costs. NON-OPERATING ITEMS: Net interest expense was $40.3 million in 1991, down $13.8 million, or 25.6%, from 1990. The decline was primarily a result of higher capitalized interest, which increased by $12.0 million as a result of the construction of the Philadelphia production plant. Lower average debt balances and lower interest rates also helped. In the last half of 1991, the proceeds from the sale of 3 million shares of new common stock were used to reduce debt. Average interest rates on commercial paper decreased from 8.3% in 1990 to 6.4% in 1991. Other non-operating income increased to $7.4 million from a $579,000 loss in 1990. This resulted from significant improvement in the earnings of our cable investments and reduced royalties paid to joint operating agreement participants in Miami and Fort Wayne. INCOME TAXES: The effective income tax rate for 1991 was 37.2%, down 2.2% from 1990's 39.4%, mostly as a result of the favorable resolution of several outstanding tax issues.
Earlier Years 1990 was the first full year of operations after entering the joint operating agreement between the Detroit Free Press and The Detroit News (owned by Gannett Co., Inc.) creating the Detroit Newspaper Agency (DNA), now
doing business as Detroit Newspapers. DNA performs the newspaper's production, sales and distribution functions, while the two papers maintain separate and independent newsrooms. This resulted in significantly improved bottom-line results from our Detroit operation. In October 1989, Knight-Ridder completed the sale of its eight television stations for an after-tax gain of $66.9 million, or $1.07 per share. In November 1989, the DNA was formed. Knight-Ridder purchased Dialog Information Services in mid-year 1988 for approximately $353.0 million, and an effective 7-1/2% interest in SCI Holdings, Inc. (parent of Storer Communication) in November 1988. Despite the $.13 per share dilutive impact of these acquisitions, the company's earnings per share from continuing operations increased 2.0% over 1987. In 1987, the company's newspaper operations received a boost from strong classified advertising and a full year of operations from the State-Record Company acquisition. The acquisition, however, cost the company approximately $.15 in earnings per share dilution. Excluding the State-Record newspapers, newspaper advertising revenue increased 4.9% on a 0.4% decline in full-run ROP linage. In 1986, Knight-Ridder acquired six daily newspapers in South Carolina and Mississippi. The company closed its Viewdata operation and sold the assets of TelAir Network, Inc. Newspaper advertising revenue increased 9.2% on a 0.5% gain in full-run ROP linage. Excluding the impact of a 46-day strike in Philadelphia in 1985, linage declined 1.2%. The volume decline was due to softness in Miami and various airline mergers. Consistent with the company's experience, newspaper advertising, particularly retail and classified, mirrored the general state of the economy from 1983 through 1985. In 1985, newspaper advertising revenue increased 2.9% on a 2.4% decline in full-run ROP linage. The linage decline resulted from the strike in Philadelphia and softness in Miami. Fueled by a strengthening economy in 1984, full-run advertising revenue was up 14.7% on a 4.6% increase in full-run linage.
A Look Ahead The outlook for 1994 is more positive than it has been going into the last few years. Signs indicate a slow but steady improvement in the economy, and the company is well positioned to benefit from the economic upturn.
The Newspaper Division is expected to have moderate revenue growth, with fairly stable newsprint pricing. We will benefit from a reduction in operating costs related to the transition to the new Philadelphia printing facility. The BIS Division, strengthened by recent acquisitions, is expected to continue its strong double-digit revenue growth and will continue its global expansion efforts. We expect to continue to benefit from lower interest rates, as higher-rate notes are called and mature, and are replaced by lower-rate commercial paper. At this time, we don't expect significant changes in our 1994 share of investee earnings from our equity investments. In early 1994, the company made several strategic moves that should strengthen our position in the future. The company acquired the assets of Technimetrics, which publishes information documenting the equity holdings of major global investment professionals. The company formed a joint venture with the Canadian electronic publishing operations of Southam, Inc., to produce a more efficient and focused operation for the Canadian marketplace. The company announced an agreement with Bell Atlantic Video Services to explore ways to deliver news, information and advertising for Bell Atlantic's Stargazer service.
Recent Acquisitions/Investments 1993 - In March, the company purchased all of the outstanding stock of Data-Star, Europe's leading online information service. In December, the company purchased all of the outstanding shares of Equinet Pty. Ltd. and EFECOM. Equinet is an Australia-based provider of online business real-time and archival equity, option price and analytical information services. EFECOM is a Spanish financial news service now known as KRF/Iberia. The company also made strategic minority investments in Individual, Inc., and Personal Library Software, Inc. In December, the company acquired a 6.0% interest in US Order, which provides a network of interactive electronic services to consumers utilizing screen-based telephones and other front-end devices. Capital Spending Program The company's capital spending program includes normal replacements, productivity improvements, capacity increases, building construction, expansion and printing press equipment. Over the past three years, expenditures have totaled $337.4 million for these items. Construction of the 693,000-square-foot production facility in Philadelphia began in 1989. The $299.5 million plant became fully operational in 1993.
Also included in capital expenditures is the San Jose press project completed during 1992 for $38.6 million and the Dialog mainframe computer equipment enhancements for $20.3 million. Financial Position and Liquidity 1993 vs. 1992 - During 1993 net cash provided by operating activities decreased 2.5% from 1992 to $330.0 million. Cash and short-term cash investments were $23.0 million at year end, down $74.1 million from the prior year. The decrease in cash and short-term cash investments was primarily due to the acquisition of Data-Star and Equinet, the repurchase of treasury shares and the prepayment of debt. During 1993, the company acquired 750,000 shares of its common stock in the open market for an aggregate price of $40.7 million. Approximately $100.0 million in notes payable, bearing 8.0% interest and maturing in 1996, were early retired in April 1993. Total debt at year-end 1993 was $109.2 million less than at year-end 1992. This resulted in an improved long-term-debt-to-equity ratio of 33.0% from 42.0% at the end of 1992 and an improved total-debt-to-total-capital ratio of 26.6% from 32.2%. Standard & Poor's and Moody's rate the company's commercial paper A1+ and P1 and long-term bonds AA- and A1, respectively. Average outstanding commercial paper during the year was $97.4 million with an average effective interest rate of 3.2%. At the end of 1993, commercial paper outstanding was $54.0 million and aggregate unused credit lines were approximately $446.0 million. Various libel actions, environmental and other legal proceedings that have arisen in the ordinary course of business are pending against the company and its subsidiaries. In the opinion of management, the ultimate liability to the company and its subsidiaries as a result of these actions and proceedings will not be material. 1992 vs. 1991 - During 1992, net cash provided by continuing operations was $338.5 million, an increase of $32.5 million from 1991 due to investee distributions being less than investee earnings and net changes in working capital. Cash and short-term cash investments of $97.1 million were $70.9 million more than the prior year. Net cash required for investing activities decreased $9.9 million, or 5.1%, from 1991 levels, due to completion of the Philadelphia plant. Total debt declined $46.6 million from 1991 levels. This resulted in an improved long-term-debt-to-equity ratio from 48.5% to 42.0% and total-debt-to-total-capital ratio from 34.6% to 32.2%. These ratios improved despite the FAS 106 and FAS 109 net cumulative charge of $105.2 million. Average outstanding commercial paper during the year was $54.6 million with an average effective interest rate of 4.3%. At the end of 1992, commercial paper outstanding was $62.3 million.
1991 vs. 1990 - During 1991, net cash provided by continuing operations was $305.9 million, a decline of $19.0 million from 1990. The 5.9% decrease was primarily due to a lower level of operating income. Cash and short-term cash investments of $26.2 million were flat with 1990. Net cash required for investing activities of $192.9 million was $85.3 million, or 30.7% less, due to reduced capital requirements for the new Philadelphia plant as it approached completion. Total debt declined $217.1 million from 1990 levels, due largely to the use of proceeds of approximately $147.0 million from the company's sale of 3 million shares of common stock in August. No treasury stock was purchased in 1991. This resulted in an improved long-term-debt-to-equity ratio from 89.8% to 48.5% and total-debt-to-total-capital ratio from 47.9% to 34.6%. During 1991 the company redeemed $160.0 million of 7-1/4% notes due in 1992 and $100.0 million of 7-7/8% notes due in 1993, and issued $160.0 million of new 8-1/2% notes, maturing in 25% increments from 1998 through 2001. Average outstanding commercial paper during the year was $250.0 million with an average effective interest rate of 6.4%. Commercial paper outstanding at the end of 1991 was $111.3 million.
Effect of Changing Prices The Consumer Price Index, a widely used measure of the impact of changing prices, has increased only moderately in recent years, up between 3% and 6% each year since 1983. Historically, when inflation was at higher levels, the impact on the company's operating costs was not significant. Historical cost depreciation charges may not accurately reflect the economic cost of replacing capital assets, but depreciation expense represents less than 5% of total operating costs. Newsprint expense represents a significant percentage of total costs, but it is a relatively current cost as inventory levels normally fluctuate between a 30- and 45-day supply. Labor and other operating costs are, by their very nature, current costs. The principal effect of inflation on the company's operating results is to increase reported costs. Historically, the company has demonstrated the ability to raise sales prices to offset these cost increases.
ITEM 8.

ITEM 8. Financial statements and supplementary data ------------------------------------------- See Quarterly Operations in Item 5.
Notes to Consolidated Financial Statements
Summary of Significant Accounting Policies Note A
A description of the company's business and the nature and scope of its operations are set forth on Items 1 & 2. Reading this information is recommended for a more complete understanding of the financial statements. The company reports on a fiscal year, ending the last Sunday in the calendar year. Results for 1993, 1992 and 1991 are for the 52 weeks ended Dec. 26, Dec. 27 and Dec. 29, respectively. The basis of consolidation is to include in the consolidated financial statements all the accounts of Knight-Ridder, Inc., and its more-than-50%-owned subsidiaries. All significant intercompany transactions and account balances have been eliminated in consolidation. The joint operating agency of Fort Wayne Newspapers, Inc., is the only subsidiary with a minority interest. The minority shareholder's interest in the net income of this subsidiary has been provided for as an expense ($5.2 million in 1993, $5.1 million in 1992 and $5.2 million in 1991) in the Consolidated Statement of Income in the caption "Other, net." The company is a 50% partner in the Detroit Newspaper Agency (DNA), a joint operating agency between Detroit Free Press, Inc., a wholly owned
subsidiary of Knight-Ridder, Inc., and The Detroit News, Inc., a wholly owned subsidiary of Gannett Co., Inc. The Consolidated Statement of Income includes on a line-by-line basis the company's pro rata share of the revenue and expense generated by the operation of the agency. Investments in companies in which Knight-Ridder, Inc., has an equity interest of at least 20% but not more than 50% are accounted for under the equity method. Under this method, the company records its share of earnings as income and increases the investment by the equivalent amount. Dividends are recorded as a reduction in the investment. All other investments are recorded at the lower of cost or net realizable value, and the company recognizes income from such investments upon receipt of a dividend. The investment caption "Equity in unconsolidated companies and joint ventures" in the Consolidated Balance Sheet represents the company's equity in the net assets of the Detroit Newspaper Agency, the Seattle Times Company and subsidiaries, a company responsible for the sales and services of general, retail and classified advertising accounts for a group of newspapers, two newsprint mill partnerships, a cable television joint venture and a joint venture that offers full-service copies of original journal articles. The company owns 49-1/2% of the voting common stock and 65% of the non-voting common stock of the Seattle Times Company, owns 33-1/3% of the voting stock of Newspapers First, is a one-third partner in the Southeast Paper Manufacturing Co., owns a 13-1/2% equity share of Ponderay Newsprint Company, and jointly owns TKR Cable Company and TKR Cable Partners. Effective December 1992, after a restructuring, the company has a 15% interest in TCI/TKR Limited Partnership through TKR Cable Partners. Prior to December 1992, the company held a 7-1/2% interest in SCI Holdings, Inc., the holding company for Storer Communications, Inc. Dialog, a Knight-Ridder subsidiary, owns 33.78% of the voting stock and 100% of the non-voting stock of Article Express International, Inc. The investment amount at Dec. 26, 1993, includes $64.1 million representing the company's share of undistributed earnings (excluding the DNA) accumulated since the investment dates. The company's share of the earnings of the unconsolidated companies (except for the DNA) of $7.3 million in 1993, $3.9 million in 1992 and $14.5 million in 1991 is included in the caption "Other, net" in the Consolidated Statement of Income. The company also recorded its share of Ponderay Newsprint Company's operating losses ($7.4 million in 1993 and $6.5 million in 1992) in this caption. Dividends and cash distributions received from the unconsolidated companies and joint ventures (excluding the DNA) were $3.0 million in 1993, $2.8 million in 1992 and $8.1 million in 1991 and offset against the investment account.
"Cash and short-term cash investments" includes currency and checks on hand, demand deposits at commercial banks, overnight repurchase agreements of government securities and investment-grade commercial paper with maturities of fewer than 90 days. Cash and short-term investments are recorded at cost. Due to the short-term nature of marketable securities, cost approximates market value. In 1994, the company will adopt Statement of Financial Accounting Standards (FAS) 115, Accounting for Certain Investments in Debt and Equity Securities, the impact of which is immaterial. "Inventories" are priced at the lower of cost ( first-in, first-out FIFO method), or market. Most of the inventory is newsprint, ink and other supplies used in printing newspapers. "Property, plant and equipment" is recorded at cost and the provision for depreciation for financial statement purposes is computed principally by the straight-line method over the estimated useful lives of the assets. The company capitalizes interest expense as part of the cost of major construction projects. "Excess of cost over net assets acquired" arises from the purchase of at least a 50% interest in a company for a price higher the fair market value of the net tangible assets. Intangible assets of this type arising from acquisitions accounted for as purchases and occurring subsequent to Oct. 31, 1970, totaled approximately $773.0 million at Dec. 26,1993. They are generally being amortized over a 40-year period on a straight-line basis, unless management has concluded a shorter term is more appropriate. If, in the opinion of management, an impairment in value occurs, based on the undiscounted cash flow method, any necessary additional write-downs will be charged to expense. "Deferred revenue" arises as a normal part of business from advance subscription payments for newspapers and business information services. Revenue is recognized in the period in which it is earned. "Short-term borrowings" represents the carrying amounts of commercial paper and other short-term borrowings that approximate fair value. "Long-term debt" represents the carrying amounts of debentures and notes payable. Fair values, disclosed in Note C, are estimated using discounted cash flow analyses based on the company's current incremental borrowing rates for similar types of borrowing arrangements. In 1992, the company adopted the FAS 106, Accounting For Postretirement Benefits Other Than Pensions, and FAS 109, Accounting For Income Taxes. The effects of adoption are described in Notes H and B, respectively. In 1994, the company will adopt FAS 112, Employers' Accounting for Postemployment Benefits. The impact on the consolidated financial statements will not be material.
Earnings per share is computed by dividing net income by the weighted average number of common and common equivalent shares outstanding. Quarterly earnings per share may not add to the total for the year, since each quarter and the year are calculated separately based on average outstanding shares during the period. Certain amounts in 1992 and 1991 have been reclassified to conform to the 1993 presentation.
Income Taxes Note B The company's income tax expense is determined under the provisions of Statement of Financial Accounting Standards 109, Accounting for Income Taxes, which was adopted in 1992. This accounting standard requires the use of the liability method in adjusting previously deferred taxes for changes in tax rates. The company chose to reflect the cumulative effect of adopting this standard as a change in accounting principle as of the beginning of 1992. The adoption resulted in a credit to earnings of $25.8 million. Prior years' financial statements were not restated. Substantially all of the company's earnings are subject to domestic taxation. With the exception of immaterial amounts of taxes withheld on trans-border receipts, no foreign income taxes have been imposed on reported earnings.
In 1991, deferred tax expense resulted principally from the excess of tax depreciation over financial statement depreciation (including depreciation on assets of partnerships in which the company participates), the tax effect of which amounted to $8.8 million. Cash payments of income taxes for the years 1993, 1992 and 1991 were $82.7 million $60.2 million and $61.4 million, respectively. Payments in 1993 include the payment and settlement of prior year state and federal income tax examinations.
At the end of fiscal years 1993 and 1992, the company's deferred tax assets totaled $135.8 million and $120.7 million, respectively, of which the most significant component was postretirement benefit plans, $87.2 million and $83.0 million, respectively (including amounts relating to partnerships in which the company participates). Other material components were: compens- ation and benefits accruals of $11.2 million in 1993 and $19.2 million in 1992,
and state net operating loss carryovers, net of allowance, of $7.0 million in 1993. Management is satisfied that a substantial portion of the state net operating loss carryovers will be realized within the applicable carryover periods. Accordingly, the related valuation allowance was reduced to $4.0 million in 1993. At the end of fiscal years 1993 and 1992, deferred tax liabilities totaled $249.3 million and $204.1 million, respectively, of which the most significant component was depreciation and amortization (including depreciation and amortization deductions claimed by partnerships in which the company has an interest). 	 The components of deferred taxes included in the Consolidated Balance Sheet are as follows (in thousands):
Debt Note C
Debt consisted of the following (in thousands):
The following table presents (in thousands) the approximate annual maturities of long-term debt for the five years after 1993:
The carrying amounts and fair values of debt as of Dec. 26, 1993, are as follows (in thousands):
Unconsolidated Companies and Joint Ventures Note D
Beginning in 1992, the company's investment in Ponderay Newsprint Company is reported in "Equity in unconsolidated companies and joint ventures" in the Consolidated Balance Sheet, and related amounts are included in the above table. In 1989, the Detroit Free Press and The Detroit News began operating under a joint operating agreement as the Detroit Newspaper Agency (DNA). Balance sheet amounts for the DNA at Dec. 26, 1993, Dec. 27, 1992, and Dec. 29, 1991, are included above and the net assets contributed to the DNA are included in "Equity in unconsolidated companies and joint ventures" in the Consolidated Balance Sheet.
Capital Stock Note E
In 1991, shareholders authorized 20.0 million shares of preferred stock for future issuance. Common stock authorized for issuance is 250.0 million shares at par value $.02-1/12 per share. The Employees Stock Purchase Plan provides for the sale of common stock to employees of the company and its subsidiaries at a price equal to 85% of the market value at the end of each purchase period. Participants under the plan received 278,251 shares in 1993, 240,022 shares in 1992 and 266,330 shares in 1991. The purchase price of shares issued in 1993 under this plan ranged between $46.59 and $50.89, and the market value on the purchase dates of such shares ranged from $54.81 to $59.88. The Employee Stock Option Plan provides for the issuance of non-qualified stock options and incentive stock options. Options are issued at prices not less than market value at date of grant and are exercisable when issued. There is no expiration date for the granting of options, but options must expire no later than 10 years from the date of grant. The option plan provides for the discretionary grant of stock appreciation rights (SARs) in tandem with previously granted options, which allow a holder to receive in cash, stock or combinations thereof the difference between the exercise price and the fair market value of the stock at date of exercise. The value of stock appreciation rights is charged to compensation expense. When options and stock appreciation rights are granted in tandem, the exercise of one cancels the exercise right of the other. Proceeds from the issuance of shares under these plans are included in shareholders' equity and do not affect income.
The exercise price of the shares issued upon exercise of stock options in 1993 ranged between $24.63 and $58.63. In 1993, shareholders voted in favor of a proposal amending the Employee Stock Option Plan to make an additional 3.5 million shares of the company's common stock available for options. In addition, shareholders voted in favor of an amendment to make 1.5 million shares of common stock available for purchase under the Employees Stock Purchase Plan.
At Dec. 26, 1993, shares of the company's authorized but unissued common stock were reserved for issuance as follows:
Shares --------- Employee stock option plans 3,569,818 Employees stock purchase plan 1,741,089 --------- Total 5,310,907 ========= Since 1985, the company has purchased 21.2 million shares of its own stock for approximately $872.0 million. See Treasury Stock Purchases in Item 5. Each holder of a common share has been granted a right, under certain conditions, to purchase from the company one common share at a price of $200, subject to adjustment. The rights provide that in the event the company is a surviving corporation in a merger, each holder of a right will be entitled to receive common shares having a value equal to two times the exercise price of the right. In the event the company engages in a merger or other business combination transaction in which the company is not the surviving corporation, the rights agreement provides that proper provision shall be made so that each holder of a right will be entitled to receive common stock of the acquiring company having a value equal to two times the exercise price of the right. The rights agreement also provides that in the event any person acquires 20% or more of the company's outstanding common stock (other than pursuant to an offer for all outstanding stock that the board determines is fair and in the best interests of the company and stockholders), each right (other than rights held by the person who has acquired such 20% or larger block) will entitle its holder to purchase common stock of the company having a value equal to twice the exercise price of the right. No rights certificates will be distributed until 10 days following a public announcement that a person or group has acquired beneficial ownership of 20% or more of the company's outstanding common stock, or 10 days following the commencement of a tender offer or exchange offer for 20% or more of the company's outstanding stock. Until such time, the rights are evidenced by the common share certificates of the company. The rights are not exercisable until distributed and will expire on July 10, 1996, unless earlier redeemed. The company has the option to redeem the rights in whole, but not in part, at a price of $.05 per right.
Retirement Plans Note F
The company and its subsidiaries have several company-administered non-contributory defined benefit plans covering most non-union employees. These plans provide benefits that are based on the employees' compensation during various times before retirement. The funding policy for these plans is to contribute annually an amount that is intended to provide the projected benefit earned during the year for the covered employees. The company also contributes to certain union-administered, company-administered and jointly administered negotiated plans covering union employees. The funding policy for these plans is to make annual contributions in accordance with applicable agreements. The company also sponsors certain defined contribution plans established pursuant to Section 401(k) of the Internal Revenue Code. Subject to certain dollar limits, employees may contribute a percentage of their salaries to these plans, and the company will match a portion of the employees' contributions. A summary of the components of net periodic pension cost for the defined benefit plans (both company-administered non-negotiated and single-employer negotiated plans) is presented here, along with the total amounts charged to pension expense for multi-employer union plans, defined contribution plans and other agreements (in thousands):
The following table sets forth the funded status and amounts recognized in the Consolidated Balance Sheet for the defined benefit plans (in thousands):
Segment Information Note G
The company is a diversified information and communications company with two principal business segments: Newspapers and Business Information Services. Financial data regarding the company's business segments are presented in Items 1 & 2 in the supplemental information. Operating revenue by industry segment includes sales to un- affiliated customers, as reported in the company's consolidated income statement. Operating income is operating revenue less operating expenses, including depreciation expense and amortization of intangibles. General corporate expenses are not allocated to the Newspaper or Business Information Services divisions. Equity in net income of unconsolidated companies and joint ventures, interest income, net interest expense, other non-operating income and expense items, as well as income taxes, have not been included in the amounts reflected as operating income by segment. Identifiable assets by segment are all assets employed in the individual operations of each business segment and excess of cost over net assets acquired associated with acquisitions in each segment. General corporate assets include cash and equivalents, other investments, net assets of unconsolidated companies and joint ventures (other than the Detroit Newspaper Agency, which is included in Newspaper Division assets), and property, plant and equipment used primarily for corporate purposes. Investments in unconsolidated companies and joint ventures are discussed in Notes A and D.
Postretirement Benefits Other Than Pensions Note H The company and its subsidiaries have defined postretirement benefit plans that provide medical and life insurance for retirees and eligible dependents. Effective with the beginning of fiscal year 1992, the company implemented, on the immediate recognition basis, Statement of Financial Accounting Standards (FAS) 106, Accounting for Postretirement Benefits Other Than Pensions. This statement requires that the cost of these benefits, which are primarily for health care and life insurance, be recognized in the financial statements throughout the employees' active working careers. The company's previous practice was to expense these costs on a cash basis, principally after retirement. The cumulative effect of adopting FAS 106 on the immediate recognition basis, as of the beginning of 1992, was to reduce net income by $131.0
million (net of income taxes of $80.3 million), or $2.37 per share. The 1992 after-tax impact of FAS 106 (excluding the cumulative effect of adoption) was to reduce earnings by $4.0 million, or $.07 per share. This charge includes a previously unrecognized accumulated postretirement benefit obligation of $211.3 million, including $47.2 million related to the company's share of the Detroit Newspaper Agency (DNA). This obligation was based on plans in place at the beginning of 1992. The company valued the accumulated postretirement benefit obligation as of Dec. 26, 1993, and Dec. 27, 1992, using the following actuarial assumptions: Discount rate: 7.5% in 1993 and 8.5% in 1992 Return on plan assets: 8.5% in 1993 and 1992 Annual rate of increase in salaries: 4.5% in 1993 and 5.0% in 1992 Medical trend rate: 12.0% for 1994, reducing to 5.5% in 2001 and thereafter and 14.0% for 1993, reducing to 6.5% in 2001 and thereafter. In 1992, the company announced several changes to its retiree non-union benefit plans that established a maximum annual dollar cap for medical premiums the company would pay and eliminated coverage for future retirees after the age of 65. During 1993, many of the company's unions adopted similar changes to their retiree benefit plans. Most current retirees will keep their current plans. Proforma amounts for 1991 show that net income would have been reduced by approximately $8.4 million (approximately $.16 per share). The impact on 1992 and 1993 is substantially less due to the effect of the plan amendments described above. These plan amendments resulted in an unrecognized reduction in prior service cost, which is being amortized over future years. 1993 reflects a full year of amortization for the reduction in prior service cost.
Acquisitions Note I On March 1, 1993, the company (through its wholly owned subsidiaries Knight-Ridder Business Information Services, Inc., and Dialog Information Services, Inc.) acquired all of the outstanding shares of Data-Star (composed of Radio Suisse and Data-Star Marketing) from Motor-Columbus and Peter Martin, respectively. Data-Star is Europe's leading online information service. On Dec. 2, 1993, the company acquired all of the outstanding shares of Equinet Pty. Ltd. Equinet is an Australia-based provider of online business real-time and archival equity, option price and analytical information services. The acquisitions were accounted for as purchases and, accordingly, the accompanying financial statements include their operations from the acquisition dates. The cost of acquisitions is included in the caption "Other items, net" in the "Cash Required For Investing Activities" section of the Consolidated Statement of Cash Flows. The effect on operations and proforma results of operations was not material.
Commitments and Contingencies Note J At Dec. 26, 1993, the company had lease commitments currently estimated to aggregate approximately $84.1 million that expire from 1994 through 2051 as follows (in thousands):
Payments under the lease contracts were $25.4 million in 1993, $25.2 million in 1992 and $24.1 million in 1991. Various libel actions, environmental and other legal proceedings that have arisen in the ordinary course of business are pending against the company and its subsidiaries. In 1990, a verdict was rendered against the company's subsidiary, Philadelphia Newspapers, Inc., (PNI), publisher of The Philadelphia Inquirer and Philadelphia Daily News, in a libel action entitled Sprague v. Philadelphia Newspapers, Inc., for $2.5 million in compensatory damages and $31.5 million in punitive damages. Following entry of the judgment on Sept. 15, 1992, PNI, as required by statute, posted a bond equal to 120% of the amount of the verdict and appealed the judgment to the Pennsylvania Superior Court. PNI believes that substantial grounds exist for a decision by an appellate court to reverse the trial court and remand the case for a new trial. In the opinion of management, the ultimate liability to the company and its subsidiaries as a result of this and other legal proceedings will not be material.
Management's Responsibility for Financial Statements Shareholders: The consolidated financial statements and other financial information were prepared by management in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods. The manner of presentation, the selection of accounting policies and the integrity of the financial information are the responsibility of management. Some of the amounts included in the financial statements are estimates based on management's best judgment of current conditions and circumstances. To fulfill its responsibilities, management has developed and continues to maintain a system of internal accounting controls. We believe the controls in use are adequate to provide reasonable assurance that assets are safeguarded
from loss or unauthorized use, and that the financial records are reliable for preparing the financial statements and maintaining accountability for assets. These systems are augmented by written policies, organizational structures providing for division of responsibilities, qualified financial officers at each operating unit, careful selection and training of financial personnel and a program of internal audits. There are, however, inherent limitations in any control system, in that the cost of maintaining a control system should not exceed the benefits to be derived. The Audit Committee of the Board of Directors is composed of outside directors and meets periodically with management, internal auditors and independent auditors, both separately and together, to review and discuss the auditors' findings and other financial and accounting matters. Both the independent and internal auditors have free access to the committee. The consolidated financial statements have been audited by the company's independent auditors and their report is presented below. The independent auditors are elected each year at the annual shareholders meeting based on a recommendation by the Audit Committee and the Board of Directors.
James K. Batten - -------------------- James K. Batten Chairman and Chief Executive Officer
Ross Jones - -------------------- Ross Jones Senior Vice President/Finance and Chief Financial Officer
Report of Independent Certified Public Accountants Shareholders Knight-Ridder, Inc.
We have audited the consolidated balance sheet of Knight-Ridder, Inc., and subsidiaries as of Dec. 26, 1993, Dec. 27, 1992, and Dec. 29, 1991, and the related consolidated statements of income, cash flows and shareholders' equity for each of the three years then ended. Our audits also included the financial statement schedules listed in the Index at Item 14 (a). These financial statements and schedules are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements and schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Knight-Ridder, Inc., and subsidiaries at Dec. 26, 1993, Dec. 27, 1992, and Dec. 29, 1991, and the consolidated results of their operations and their cash flows for the years then ended, in conformity with generally accepted accounting principles. Also, in our opinion, the related financial statement schedules, when considered in relation to the basic financial statements taken as a whole, present fairly in all material respects the information set forth therein. As discussed in Notes B and H the consolidtaed financial statements, in 1992 the Company changed its method of accounting for income taxes and postretirement benefits other than pensions.
ERNST & YOUNG
Miami, Fla. Feb. 1, 1994
ITEM 9.

ITEM 9. Changes in and Disagreements with Accountants on Accounting and --------------------------------------------------------------- Financial Disclosure. ---------------------
Not Applicable
PART III
ITEM
10.

ITEM
10. Directors and Executive Officers of the Registrant -------------------------------------------------- 1994 Proxy Statement page 2, "Election of Directors"; page 3, "Nominees for Election as Directors for Terms Ending 1997"; page 4, "Nominees for Election as Directors for Terms Ending 1995"; "Nominees for Election as Directors for Terms Ending 1996"; page 15, "Certain Transactions, Relationships and Reports of Certain Stock Transactions."
Knight-Ridder's Executive Committee:
James K. Batten, 58, chairman since 1989 and chief executive officer since 1988. Served as president 1982 to 1989; senior vice president 1980 to 1982; vice president/news 1975 to 1980; Charlotte Observer executive editor 1972 to 1975. Advanced Management Program, Harvard Business School, 1981; M.P.A., public affairs, Princeton University, 1962; B.S., chemistry/ biology, Davidson College, 1957.
Alvah H. Chapman Jr., 72, chairman of the Executive Committee since 1984. Served as chairman of the board 1982 to 1989; chief executive officer 1976 to 1988; president 1973 to 1982; executive vice president 1967 to 1973; vice president 1966 to 1967; Miami Herald general manager 1962 to 1969. B.S., business administration, The Citadel, 1942.
Mary Jean Connors, 41, vice president/human resources since 1989. Served as Philadelphia Newspapers, Inc., vice president/human resources 1988 to 1989; assistant to the senior vice president/ news for Knight-Ridder 1988; The Miami Herald assistant managing editor/ personnel 1985 to 1988; held various editing positions at The Miami Herald 1980 to 1985. B.A., English, Miami University in Oxford, Ohio, 1973.
John C. Fontaine, 62, executive vice president since January 1994; senior vice president 1987 to 1993; general counsel 1980 to 1993. Formerly a partner with Hughes Hubbard & Reed. LL.B., Harvard Law School, 1956; B.A., political science, University of Michigan, 1953.
Ross Jones, 51, senior vice president and chief financial officer since October 1993; vice president/finance since March 1993. Served as vice president and treasurer of Reader's Digest Association, Inc., 1985 to 1993 and in other positions there 1977 to 1985. Served as manager at Brown Brothers Harriman & Co. 1970 to 1977. M.B.A., finance, Columbia University Business School, 1970; B.A. in classics, Brown University, 1965.
Bernard H. Ridder Jr., 77, former chairman of the board 1979 to 1982; former chairman of the Executive Committee 1976 to 1984; former vice chairman of the board 1974 to 1979. Served as president and chief executive officer of Ridder Publications, Inc., 1969 to 1974. B.A., history, Princeton University, 1938.
P. Anthony Ridder, 53, president since 1989; president of Newspaper Division since 1986; chairman of the Operating Committee since 1985; board member since 1987. Served as publisher of the San Jose Mercury News 1977 to 1986; general manager 1975 to 1977; business manager 1969 to 1975. B.A., economics, University of Michigan, 1962.
Other Officers:
Marty Claus, 45, vice president/ news since 1993. Served as Detroit Free Press managing editor/business and features from 1987 to 1992; held various editing positions at the Free Press 1977 to 1987. Held various writing and editing positions at the San Bernardino (Calif.) Sun-Telegram 1970 to 1977. B.A., journalism, Michigan State University Honors College, 1970.
Stephen D. Dempsey, 41, assistant vice president/information systems since February 1994. Served as director of information systems from 1990 to 1994; San Jose Mercury News information systems director from 1984 to 1990; various technical positions 1979 to 1984; Boulder Daily Camera, various programming and circulation positions, 1969 to 1979. B.A., history, University of Colorado, 1975.
Gary R. Effren, 37, assistant vice president/assistant treasurer since December 1993. Served as assistant to the vice president/ finance and treasurer 1989 to 1993; director of corporate accounting 1986 to 1989; business manager of Viewdata Corp. of America 1984 to 1986; manager of financial reporting 1983 to 1984. M.B.A., University of Miami, 1989; B.S., accounting, Rider College, 1978.
Virginia Dodge Fielder, 45, vice president/research since 1989. Served as vice president/news and circulation research 1986 to 1989. Served as director/news and circulation research 1981 to 1985; editorial research manager, Chicago Sun-Times 1979 to 1981; held various positions at Lexington Herald-Leader 1976 to 1979. Ph.D., mass communications, Indiana University, 1976; M.A., journalism, Indiana University, 1974; B.A., psychology, Transylvania University, 1970.
Douglas C. Harris, 54, vice president and secretary since 1986. Served as vice president/personnel 1977 to 1985; director/personnel 1972 to 1977. Formerly with Peat, Marwick, Mitchell and Co. as director of college and special recruiting. Advanced Management Program, Harvard Business School, 1987; Ed.D., counseling and guidance, Indiana University, 1968; M.S., student personnel, Indiana University, 1964; B.S., business administration, Murray State University, 1961.
W. H. (Gus) Harwell Jr., 64, senior vice president/operations since 1989. Served as group vice president/operations 1981 to 1989. Served as Tallahassee Democrat president and publisher 1978 to 1981; general manager 1973 to 1978; Boca Raton News publisher 1968 to 1973. B.J., community journalism, University of Missouri, 1951.
Clark Hoyt, 51, vice president/news since August 1993. Served as chief of the Knight-Ridder Washington Bureau 1987 to 1993; news editor 1985 to 1987; managing editor, The Wichita Eagle, 1981 to 1985; various editing positions, Detroit Free Press, 1977 to 1981; various reporting positions, the Detroit Free Press and Washington Bureau. B.A., English literature, Columbia College, 1964.
Ivan A. Jones, 51, assistant vice president/personnel research and development since 1986. Served as director/ personnel research and development 1977 to 1986; personnel consultant 1975 to 1977. Formerly with the consulting firm of Byron Harless, Reid & Associates 1973 to 1975. Ph.D., industrial psychology, Baylor University, 1969; M.A., psychology, Baylor University, 1967; B.A., psychology, University of Arizona, 1964.
Polk Laffoon IV, 48, vice president/ corporate relations since March 1994. Served as assistant to the president 1992 to 1994; assistant circulation director/distribution, The Miami Herald, 1991 to 1992; executive assistant to the vice president/marketing 1989 to 1991; Living Today editor, 1987 to 1989. Served as director and vice president/ investor relations, Taft
Broadcasting Co., 1982 to 1987. Held various writing and editing positions at the Detroit Free Press 1978 to 1982. M.B.A., marketing, Wharton School, 1970; B.A., English, Yale, 1967.
Tally C. Liu, 43, vice president/finance and controller since October 1993; vice president and controller 1990 to 1993. Served as San Jose Mercury News vice president and chief financial officer 1987 to 1990; chief financial officer 1986 to 1987; controller 1983 to 1986; Boca Raton News controller 1980 to 1983; assistant controller 1978 to 1980. M.B.A., Florida Atlantic University, 1977; B.S., business administration, National Chen-Chi University, 1973; CPA.
Mario R. Lopez, 54, assistant vice president/internal audit since July 1993. Served as partner at Deloitte & Touche 1978 to 1993 and in other positions there from 1964 to 1978. B.S., business administration, Saint Joseph's University, 1962, CPA.
Larry D. Marbert, 40, vice president/ technology since February 1994. Served as Philadelphia Newspapers, Inc., senior vice president/operations 1991 to 1994; vice president/operations research and planning 1988 to 1991; vice president/production 1986 to 1988; Knight-Ridder director of production/Newspaper Division 1981 to 1986; various production positions, The Miami Herald, 1977 to 1981. M.S., management science, Auburn University, 1977; B.S., University of North Carolina, business administration, 1976.
Jerry M. Marshall, 55, assistant vice president/financial services since 1986. Served as director of accounting administration 1984 to 1985; director of corporate accounting 1977 to 1984; manager of corporate accounting 1972 to 1977; internal auditor 1969 to 1972. B.S., accounting, Kent State University, 1963.
Cristina Lagueruela Mendoza, 47, vice president/general counsel since 1993; vice president/associate general counsel 1992 to 1993; associate general counsel since 1990. Served as a partner in the Miami law firm of Murai, Wald, Biondo, Moreno & Mendoza, P.A., 1988 to 1990; associate 1984 to 1988. J.D., University of Miami Law School, 1982; M.A., political science, University of Miami, 1967; B.A., political science, Chatham College, 1966.
Laurence D. Olmstead, 36, assistant vice president/ human resources/ diversity since December 1993. Served as special projects editor/metro staff of The New York Times 1993; city editor of the Detroit Free Press 1991 to 1993; held various editing and reporting positions 1980 to 1991. Attended George Washington University.
Peter E. Pitz, 52, vice president/operations since February 1994. Served as vice president/technology 1989 to 1994; San Jose Mercury News vice president/operations 1987 to 1989; Detroit Free Press director of operations 1983 to 1987; Denver Post operations manager 1974 to 1983. M.B.A., Denver University, 1979; B.S., business administration, Northern Illinois University, 1963.
David K. Ray, 52, president of Business Information Services Division since 1983; Knight-Ridder vice president since 1980. Formerly a vice president, LIN Broadcasting Co. M.B.A., University of Chicago, 1965; B.A., liberal arts, Colgate University, 1963.
Stephen H. Sheriff, 47, assistant vice president/taxation since 1989. Served as director of taxation 1987 to 1989. Formerly with Federal Express as director of taxation. J.D., University of Miami School of Law, 1992; B.B.A., accounting, University of Georgia, 1971; CPA.
Homer E. Taylor, 51, vice president/supply since 1987. Formerly vice president/manufacturing and supply with Scripps Howard. B.S., business, West Virginia Institute of Technology, 1973; A.S., electrical engineering, West Virginia Institute of Technology, 1970.
Jerome S. Tilis, 51, vice president/marketing since 1987. Served as president of the Detroit Free Press 1985 to 1989; senior vice president of Philadelphia Newspapers, Inc., 1980 to 1985; vice president of advertising sales and marketing 1979 to 1980; advertising director 1977 to 1979. Advanced Management Program, Harvard Business School, 1984; B.S., chemistry, Hunter College, 1964.
Knight-Ridder Board: The Knight-Ridder Board of Directors is composed of members who represent a wide cross-section of American business and journalism. The group includes highly experienced investment and commercial bankers, leaders of top American corporations, senior executives and retired executives of the company and members of the Knight and Ridder families. The group is the central governing body of the company.
Eric Ridder, 75, publisher emeritus of The Journal of Commerce, a director since 1983; attended Harvard University.
Jesse Hill Jr., 67, chairman and chief executive officer of Atlanta Life Insurance Co., a director since 1980; M.B.A., actuarial science, University of Michigan, 1949; B.S., mathematics and physics, Lincoln University, 1947.
Barbara Knight Toomey, 56, experienced in management consulting, data retrieval and storage, resort management and library science, a director since 1989; B.A., geography and zoology, Boston University, 1959.
James K. Batten, 58, chairman and chief executive officer, a director since 1981; Advanced Management Program, Harvard Business School, 1981; M.P.A., public affairs, Princeton University, 1962; B.S., chemistry/biology, Davidson College, 1957.
Ben R. Morris, 71, former president of The State-Record Company, a director since 1986; B.S., textile engineering, North Carolina State University, 1948.
Peter C. Goldmark Jr., 53, president of The Rockefeller Foundation, a director since 1990; B.A., government, Harvard College, 1962.
Bernard H. Ridder Jr., 77, former chairman of the board and of the Executive Committee, a director since 1946; B.A., history, Princeton University, 1938.
P. Anthony Ridder, 53, president of Knight-Ridder and of the Newspaper Division, a director since 1987; B.A., economics, University of Michigan, 1962.
C. Peter McColough, 71, former chairman and CEO of Xerox Corp., a director since 1982; LL.B., law, Dalhousie University (Nova Scotia), 1947; M.B.A., Harvard University, 1949.
Joan Ridder Challinor, 66, research associate at the National Museum of American History, Smithsonian Institution, a director since 1989; Ph.D., U.S. history, The American University in Washington, D.C., 1982; M.A., U.S. history/ancient history, The American University, 1974; B.A., history, The American University, 1971.
Thomas L. Phillips, 69, retired chairman and chief executive officer of Raytheon Co., a director since 1983; M.S., electrical engineering, Virginia Polytechnic Institute, 1948; B.S., electrical engineering, Virginia Polytechnic, 1947.
Barbara Barnes Hauptfuhrer, 65, director of several public companies, a Knight-Ridder director since 1979; B.A., sociology and economics, Wellesley College, 1949.
William S. Lee, 64, chairman and president of Duke Power, a director since 1990; B.S., civil engineering, Princeton University, 1951.
John L. Weinberg, 69, senior chairman of Goldman, Sachs & Co., a director since 1969; M.B.A., business administration, Harvard University, 1950; B.A., economics, Princeton University, 1948.
Gonzalo F. Valdes-Fauli, 47, regional chief executive: Latin America of Barclays Bank PLC, a director since 1992; master's in international finance, Thunderbird Graduate School for International Management, 1970; B.S., economics, Spring Hill College, 1968.
Alvah H. Chapman Jr., 72, chairman of the Executive Committee and former chairman of the board and chief executive officer, a director since 1962; B.S., business administration, The Citadel, 1942.
11. Executive Compensation ---------------------- 1994 Proxy Statement, pages 7 and 8, "Compensation Committee Interlocks and Insider Participation"; pages 8 through 10, "Executive Compensation;" page 11, "Senior Executive Compensation;" page 12, "Stock Options Granted;" pages 12 and 13, "Stock Options Exercised;" page 13, "Pension Benefits;" and page 15, "Compensation of Directors"
12. Security Ownership of Certain Beneficial Owners and Management -------------------------------------------------------------- 1994 Proxy Statement page 1, "Common Stock Outstanding and Principal Holders" and page 6, "Security Ownership of Management"
See Note E in Item 8.
13. Certain Relationships and Related Transactions ---------------------------------------------- 1994 Proxy Statement page 15, "Certain Transactions, Relationships and Reports of Certain Stock Transactions"
PART IV
14. Exhibits, Financial Statement Schedules, and Reports on Form ------------------------------------------------------------ 8-K. ---- (a)
1. The following consolidated financial statements of Knight-Ridder, Inc. and subsidiaries, included in the annual report of the registrant to its shareholders for the year ended December 26, 1993, are included in Item 8:
Consolidated Balance Sheet - December 26, 1993, December 27, 1992 and December 29, 1991
Consolidated Statement of Income - Years ended December 26, 1993, December 27, 1992 and December 29, 1991
Consolidated Statement of Cash Flows - Years ended December 26, 1993, December 27, 1992 and December 29, 1991
Consolidated Statement of Shareholders' Equity - Years ended December 26, 1993, December 27, 1992 and December 29, 1991
Notes to consolidated financial statements - December 26, 1993
2. The following consolidated financial statement schedules of Knight-Ridder, Inc. and subsidiaries are submitted as a separate section of this report.
Schedule V - Property, plant and equipment
Schedule VI - Accumulated depreciation, depletion and amortization of property, plant and equipment
Schedule VIII - Valuation and qualifying accounts
Schedule IX - Short-term borrowings
Schedule X - Supplementary income statement information
All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions, or are inapplicable, or have been shown in the consolidated financial statements or notes thereto, and therefore have been omitted from this section.
3. Exhibits Filed
No. 3 - Articles of Incorporation and Bylaws are incorporated by reference to the Company's Form 10K, filed in March, 1981.
No. 4 - Indenture, dated as of April 6, 1989, is incorporated by reference to the Company's Registration Statement on Form S-3, effective April 7, 1989. (No. 33-28010)
No. 10 - 1993 Executive MBO Plan description is incorporated herein on pages 116 to 121.
- Amendment to the Employee Stock Option Plan originally filed on May 6, 1980 is incorporated herein on pages 121-129
- Director's Pension Plan dated January 1, 1994 is filed herein on pages 129-131
- Executive Officer's Retirement Agreement dated July 19, 1993 is incorporated herein on pages 131-133
No. 11 - Statement re Computation of Per Share Earnings is filed herein on pages 133-135.
No. 12 - Statement re Computation of Earnings to Fixed Charges Ratio From Continuing Operations is filed herein on page 135-136.
No. 19 - Executive Officer's Consulting/Retirement Agreement dated September 20, 1989 is incorporated herein on pages 136-138
- Executive Officer's Retirement Agreement dated December 19, 1991 is incorporated herein on pages 139-142.
No. 22 - Subsidiaries of the registrant is filed herein on pages 142-144.
No. 24 - "Consent of Independent Certified Public Accountants" is filed herewith on page 145.
No. 25 - "Powers of Attorney" for all members of the Board of Directors, are filed herein on pages 146-161.
(b) Reports on Form 8-K None were filed during the fourth quarter of 1993.
(c) Exhibits The response to this portion of Item 14 is submitted as a separate section of this report.
(d) Financial Statement Schedules The response to this portion of Item 14 is submitted as a separate section of this report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
KNIGHT-RIDDER, INC.
Dated March 22, 1994 By James K. Batten - -------------------- ------------------------------- James K. Batten Chairman of the Board and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Dated March 22, 1994 James K. Batten - ---------------------- ------------------------------- James K. Batten Chairman of the Board and Chief Executive Officer
Dated March 22, 1994 Ross Jones - ---------------------- ------------------------------- Ross Jones Chief Financial Officer and Senior Vice President/Finance
Dated March 22, 1994 Tally C. Liu - ---------------------- -------------------------------
Tally C. Liu Vice President/Finance and Controller (Chief Accounting Officer)
/s/ James K. Batten* -------------------------------- James K. Batten Director
/s/ Alvah H. Chapman, Jr.* -------------------------------- Alvah H. Chapman, Jr. Director
/s/ Joan Ridder Challinor * ------------------------------- Joan Ridder Challinor Director
/s/ Peter C. Goldmark, Jr.* ------------------------------- Peter C. Goldmark, Jr. Director
/s/ Barbara Barnes Hauptfuhrer* ------------------------------- Barbara Barnes Hauptfuhrer Director
/s/ Jesse Hill, Jr.* ------------------------------- Jesse Hill, Jr. Director
/s/ William S. Lee* ------------------------------- William S. Lee Director
/s/ C. Peter McColough* ------------------------------- C. Peter McColough Director
/s/ Ben R. Morris* ------------------------------- Ben R. Morris Director
/s/ Thomas L. Phillips* ------------------------------- Thomas L. Phillips Director
/s/ P. Anthony Ridder* ------------------------------- P. Anthony Ridder Director
/s/ Bernard H. Ridder, Jr.* ------------------------------- Bernard H. Ridder, Jr. Director
/s/ Eric Ridder* ------------------------------- Eric Ridder Director
/s/ Barbara Knight Toomey * ------------------------------- Barbara Knight Toomey Director
/s/ John L. Weinberg* ------------------------------- John L. Weinberg Director
/s/Gonzalo F. Valdes-Fauli* ------------------------------- Gonzalo F. Valdes-Fauli Director
Dated March 22, 1994 *By Ross Jones - ---------------------- ---------------------------- Ross Jones Attorney-in-fact
ANNUAL REPORT ON FORM 10-K
ITEM 14 (a) (2), (c) and (d)
SUPPLEMENTARY DATA
CERTAIN EXHIBITS
YEAR ENDED DECEMBER 26, 1993
KNIGHT-RIDDER, INC. AND SUBSIDIARIES
MIAMI, FLORIDA
SCHEDULE V
SCHEDULE VIII
SCHEDULE IX
EXHIBIT 10 ---------- GENERAL DESCRIPTION 1993 EXECUTIVE MBO PLAN (DESCRIPTION)
I. Program Overview
Following is an outline of the KRI Executive MBO Program. A. Basic Performance Criteria
This incentive MBO program is related directly to:
1. The growth of operating profit for the corporation or for individual operating units.
2. The meeting of budgeted profit levels.
3. The attainment of individual performance goals that will contribute to the long-range strength of KRI.
B. Factors Affecting Design of the Program.
1. Survey Data - Annual compensation studies by Towers Perrin and by others provide up-to-date data on compensation levels. From these studies, reliable competitive averages (as well as maximums and minimums) on most of our major positions are established.
2. KRI Position Within Our Industry - We wish to achieve a position such that an average KRI executive's total compensation will be competitive with compensation of executives at comparable companies. This positioning is necessary to continue to attract and retain the type of executive we want.
3.Rewards Increase With Responsibility - In general, the practice in American industry is for higher award opportunities at the top of the organization, since these executives have greater influence on profitability and should have more at risk.
C. Program Regulations
1. Effective Starting Date - January 1, 1993, for this revised program.
2. Maximum Limit - It is usual practice to establish a limit to the amount that can be paid out in an executive award program in a given year. An appropriate limiting formula for the Category I and II participants will be one half of one percent of beginning shareholder equity.
3. Eligibility - Participants in the KRI Executive MBO Program are in three basic categories as follows: (The Chairman/CEO, President and Executive Vice President are excluded from the program. Awards, if any, for incumbents in these three offices are at the sole discretion of the KRI Compensation Committee.)
*Category I - Included as participants are all corporate officers, and certain director - level corporate employees.
*Category II - Included are newspaper publishers and other unit operating heads who report directly to corporate officers. The President of Ft. Wayne News-Sentinel, the Chief of the Washington Bureau and the Editor of KRTN are included in this category.
*Category III - Includes top editors, general managers and all division directors. (Any employee in this category not currently in the program joined the program on January 1, 1989. Exceptions may be negotiated with the Division Presidents in cases of inequity).
*Category IV - Employees not included in Categories I,II or III of the MBO program who hold positions of sufficient scope and organizational impact to be deemed by senior management as appropriately included in the KRI Executive MBO program.
D. Goals
Individual performance goals are an integral part of the KRI Executive Compensation Program.
1. Each participant in this program is or will be committed to written, defined goals in a number of fields such as: editorial product improvement, customer service, increased readership and/or product usage, circulation improvement, advertising share, personnel development and training, pluralism, leadership, etc.
2. The individual performance goals are the manager's program of how the operating unit will be improved. They are then reviewed, adjusted and finally accepted as meaningful and attainable by the senior officer to ensure that the goals have a valid corporate purpose. In this way, these goals are established from the "bottom up" rather than imposed by top management.
3. Goals should not number more than 6 to 8 objectives. Each goal will be given a weight, based on its relative importance, on a scale of 1 to 100. The combined weight of all the goals must equal 100. At the end of each year an individual is evaluated on the percentage of each goal accomplished, with the total yielding an individual's performance factor.
II Award Calculations
The award will be determined by these factors:
A. The salary of the individual participant. See Appendix A.
B. Operating profit - This factor measures operating profit for the current year against the previous year on a scale running from 90% to 115 %. This represents 25% of the award potential.
C. Budgeted performance - This factor measures operating profit performance against budgeted performance on a scale running from 90% to 105%. This represents the other 75% of award potential.
D. Individual performance - This factor measures the individual performance against pre-established goals.
EXHIBIT 10 KNIGHT-RIDDER, INC. ----------
EMPLOYEE STOCK OPTION PLAN (As amended through May 13, 1993) 1. PURPOSE The purpose of this Stock Option Plan (hereinafter referred to as the "Plan") is to attract and retain key employees of Knight-Ridder, Inc. (hereinafter referred to as the "Company") and its subsidiaries, by the grant of options and stock appreciation rights. "Subsidiaries" as used herein shall mean corporations (other than Knight- Ridder, Inc.) or partnerships in an unbroken chain of corporations and/or partnerships beginning with Knight-Ridder, Inc. if, at the time the granting of the option or stock appreciation right, each of the corporations and
partnerships other than the last corporation or partnership in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in a corporation in such chain or at least a 50% partnership in such chain. Except as provided in Paragraph 7, a "stock appreciation right" shall mean the right of a holder thereof to receive from the Company, upon surrender of the related option, an amount equal to (A) the excess of the fair market value of a share of common stock on the date the stock appreciation right is exercised over the option price provided for in the related option, multiplied by (B) the number of shares with respect to which such stock appreciation right shall have been exercised. The term "fair market value" of a share of common stock as of any date shall be the mean between the highest and lowest sales price of a share of common stock on the date in question as reported on the composite tape for issues listed on the New York Stock Exchange. If no transaction was reported on the composite tape in the common stock on such date, the prices used shall be the prices reported on the nearest day preceding the date in question. If the common stock is not then listed or admitted to trading on such Exchange, "fair market value" shall be the mean between the closing bid and asked prices on the date in question as furnished by any member firm of the New York Stock Exchange selected from time to time for that purpose by the Compensation Committee. 2. ADMINISTRATION OF THE PLAN The Plan shall be administered by a committee as appointed from time to time by the Board of Directors of the Company, which committee shall consist of not less than three (3) members of such Board of Directors, all of whom shall be disinterested persons. Said committee shall be called the "Compensation Committee." In administering the Plan, the Compensation Committee may adopt rules and regulations for carrying out the Plan. The interpretation and decision with regard to any question arising under the Plan made by the Committee shall, unless overruled or modified by the Board of Directors of the Company, be final and conclusive on all employees of the Company and its subsidiaries participating or eligible to participate in the Plan. A Committee member shall be a "disinterested person" only if such person is not, at the time such person exercises discretion in administering the Plan, eligible and has not at any time within one year prior thereto been eligible for selection as a person to whom stock may be allocated or to whom stock options or stock appreciation rights may be granted pursuant to the Plan or any other plan of the Company or any of its affiliates entitling the
participants therein to acquire stock, stock options or stock appreciation rights of the Company or any of its affiliates. 3. STOCK The stock which may be issued and sold pursuant to the exercise of options or stock appreciation rights granted under the Plan may be authorized and unissued common stock or shares of common stock reacquired by the Company and held in treasury of a total number not exceeding 16,100,000 shares. The shares deliverable under the Plan shall be fully paid and non- assessable shares. Any shares, in respect of which an option is granted under the Plan which shall have for any reason expired or terminated, may be again allotted under the Plan. Any shares covered by options which have been canceled by reason of the exercise of related stock appreciation rights as provided in the immediately following paragraph or which are used to exercise other options or to satisfy tax withholding obligations shall not be available for other options under the Plan. The exercise of options with respect to which stock appreciation rights shall have been granted shall cause a corresponding cancellation of such stock appreciation rights, and the exercise of stock appreciation rights issued in respect of options shall cause a corresponding cancellation of such options. Each option and stock appreciation right granted under the Plan shall be subject to the requirement and condition that if the Board of Directors shall determine that the listing, registration or qualification upon any Securities Exchange under any state or federal law, or the approval or consent of any governmental body is necessary or desirable as a condition of granting such option or stock appreciation right, or the issue or purchase of any shares thereunder, then no such option or stock appreciation right may be exercised in whole or in part unless or until such listing, registration, qualification or approval has been obtained, free of any conditions which are not acceptable to the Board of Directors of the Company. 4. ELIGIBILITY Options and stock appreciation rights will be granted only to persons who are employees of the Company and its subsidiaries (including officers and directors except for persons acting as directors only). The Compensation Committee of the Board of Directors of the Company shall determine in its sole discretion the employees to be granted options, the number of shares subject to each option, the employees to be granted stock appreciation rights and the options with respect to which such stock appreciation rights shall be granted.
5. PRICE The purchase price under each option shall be determined by the Compensation Committee subject to approval by the Board of Directors of the Company, but such price shall not be less than one hundred percent (100%) of the fair market value of the stock at the time such option is granted. 6. THE PERIOD OF THE OPTION AND THE EXERCISE OF THE SAME Each option granted under the Plan shall expire no later than ten (10) years from the date such option is granted, but the Compensation Committee may prescribe a shorter period for any individual option or options. The shares subject to the option may be purchased from time to time during the option period, subject to any waiting period or vesting schedule the Compensation Committee may specify for any individual option or options. In order to exercise the option or any part thereof, the employee shall give notice in writing to the Company of his intention to purchase all or part of the shares subject to the option, and in said notice he shall set forth the number of shares as to which he desires to exercise such option, and shall pay for such shares at the time of exercise of such option. Such payment may be made in cash, through the delivery to the Company of shares of common stock of the Company with a value equal to the total option price, or through a combination of cash and shares, and any shares so delivered shall be valued at their fair market value on the date on which the option is exercised. Such payment may also be made through the delivery to the Company of all or part of the shares of common stock of the Company that are the subject of the option; provided that such option is not an incentive stock option, and such employee instructs Manufacturers Hanover Trust Company ("MHTC") to effect on the date of such exercise or as early as practicable thereafter the sale of such number of such shares "at the market" in a broker's transaction (within the meaning of Section 4(4) of the Securities Act of 1933, as amended), the proceeds of which shall be at least equal to the purchase price of such option, plus the amount of income tax required to be withheld by the Company plus transaction costs. In accordance with these instructions MHTC shall sell such shares, deliver to the Company the portion of the proceeds of such sale which equals the purchase price of such option plus the amount of income tax required to be withheld by the Company and remit the remaining sale proceeds (net of transaction costs) to such employee. Said employee shall set forth in said notice, if in the opinion of Counsel for the Company it is necessary or desirable, that it is his present intention to acquire said shares being purchased for investment and not with a view to, or for sale in connection with, any distribution thereof. Except
as specified in Paragraph 10 below, no option may be exercised except by the Optionee personally while he is in the employ of the Company or its subsidiaries and shall have been so employed continuously since the granting of his option. No Optionee or his legal representative, legatees or distributees, as the case may be, shall be or have any of the rights and privileges of a shareholder of the Company by reason of such option unless and until certificates for shares are issued to him under the terms of the Plan.
7. THE PERIOD OF THE STOCK APPRECIATION RIGHT AND THE EXERCISE OF THE SAME
A stock appreciation right granted under the Plan shall be exercisable during the period commencing on a date specified by the Compensation Committee and ending on the date on which the related option expires unless such option is earlier canceled or terminated, provided that such right may be exercised by an officer (as that term is defined in the Securities Exchange Act of 1934), a director or a beneficial owner of more than 10% of any class of the Company's equity securities only during any period beginning on the third business day following the release of a quarterly or annual summary statement of the Company's sales and earnings and ending on the twelfth business day following such date (a "ten-day window period"). Notwithstanding the preceding sentence, the Compensation Committee may provide for the grant of a stock appreciation right the exercise of which may occur outside of a ten-day window period but shall be limited to a sixty-day period following certain events specified by the Compensation Committee in the grant of such stock appreciation right. Moreover, notwithstanding the third subparagraph of Paragraph 1 above, the Compensation Committee may provide that such stock appreciation right shall be payable only in cash and that, in addition to payment of the amount otherwise due upon exercise of such stock appreciation right, the holder thereof shall receive (unless such stock appreciation right is in tandem with an incentive stock option, as defined in Section 422A(b) of the Internal Revenue Code of 1986, as amended), an amount equal to the excess of the highest price paid for a share of common stock in the open market or otherwise over the sixty-day period prior to exercise over the fair market value of a share of common stock on the date the stock appreciation right is exercised. In order to exercise the stock appreciation right or any part thereof, the employee shall give notice in writing to the Company of the intention to exercise such right, and in said notice the employee shall set forth the number of shares as to which such employee desires to exercise the stock
appreciation right, provided that such right may not be exercised with respect to a number of shares in excess of the number for which such option could then be exercised. Except as specified in Paragraph 10 below, no stock appreciation right may be exercised except by the holder thereof personally while such holder is in the employ of the Company or its subsidiaries and shall have been so employed continuously since the granting of the stock appreciation right. No holder of a stock appreciation right or such holder's legal representatives, legatees or distributees, as the case may be, shall be or have any of the rights and privileges of a shareholder of the Company by reason of such stock appreciation right unless and until certificates for such shares are issued to such holder under the terms of the Plan. 8. NON-TRANSFERABILITY OF OPTION AND STOCK APPRECIATION RIGHT No option or stock appreciation right granted under the Plan to an employee shall be transferred by him otherwise than by Will or by the laws of Descent and Distribution, and such option or stock appreciation right shall be exercisable during his lifetime only by him. 9. TERMINATION OF EMPLOYMENT If an Optionee shall cease to be employed by the Company or one of its subsidiaries, as the case may be, for any reason other than death, disability or retirement pursuant to a retirement plan of the Company or one of its sub- sidiaries, any option and any stock appreciation right theretofore granted to him which has not been exercised shall forthwith cease and terminate. However, the Compensation Committee of the Board of Directors may provide in the grant of any option or stock appreciation right or in an amendment of such grant that in the event of any such termination of employment (except termination for cause by the Company or one of its subsidiaries), any option and any stock appreciation right theretofore granted to him which has not been exercised shall be exercisable only within three months after his termination, but in no event after the expiration of the stated term of said option or any such stock appreciation right. The Company or any of its subsidiaries shall have "cause" to terminate the Optionee's employment only on the basis of the Optionee's having been guilty of fraud, misappropriation, embezzlement or any other act or acts of dishonesty constituting a felony and resulting or intended to result directly or indirectly in a substantial gain or personal enrichment to the Optionee at the expense of the Company or any of its subsidiaries. Notwithstanding the foregoing, the Optionee shall not be deemed to have been terminated for cause unless and until there shall have been delivered to the Optionee a copy of a resolution (i) duly adopted by three-quarters (3/4) of the entire membership of the Compensation Committee
of the Board of Directors, or of the Board of directors of the Company, at a meeting called and held for such purpose after reasonable notice to the Optionee and an opportunity for the Optionee, together with the Optionee's counsel, to be heard before such Committee or the Board of Directors of the Company, as the case may be, and (ii) finding that in the good faith opinion of such Committee or the Board of Directors of the Company, as the case may be, the Optionee was guilty of conduct described in the preceding sentence of this paragraph and specifying the particulars of such conduct in detail. 10. RETIREMENT OR DEATH OF OPTIONEE OR HOLDER OF STOCK APPRECIATION RIGHT In the event of the retirement of an Optionee pursuant to a retirement plan of the Company or one of its subsidiaries, as the case may be, the option and any stock appreciation right heretofore granted to him shall be exercisable during such period of time, not to exceed one (1) year after the date of such retirement with respect to incentive stock options, as defined in Section 422A(b) of the Internal Revenue Code of 1986, as amended, and not to exceed three (3) years after the date of such retirement with respect to all other stock options and stock appreciation rights, as the Compensation Committee shall specify in the option grant either at the time of grant or by amendment, but in no event after the expiration of the term of said option or any such stock appreciation right. In the event of the disability or death of an Optionee while in the employ of the Company or one of its subsidiaries, or during the post employment period referred to in the immediately preceding paragraph, the option hereto- fore granted to him shall be exercisable any time prior to the expiration of six (6) months after the date of such disability or death but in no event after the expiration of the term of said option. In the event of the disability or death of the holder of a stock appreciation right while in the employ of the Company or one of its subsidiaries, or during the post employment period referred to in the first paragraph of this Section 10, the stock appreciation right heretofore granted to him shall be exercisable any time prior to six (6) months after the date of such disability or death, but in no event after the expiration of the term of such stock appreciation right. Such option or stock appreciation right may only be exercised by the personal representative of such decedent or by the person or persons to whom such employee's rights under the option or stock appreciation right shall pass by such employee's Will or by the laws of Descent and Distribution of the state of such employee's domicile at the time of death, and then only as and to the extent that such employee was entitled to exercise the option or stock appreciation right on the date of death.
11. WRITTEN AGREEMENT Within a reasonable time after the date of grant of an option, an option and stock appreciation right or a stock appreciation right related to a previously granted option, a written agreement in a form approved by the Compensation Committee shall be duly executed and delivered to the Optionee. 12. ADJUSTMENT BY REASON OF RECAPITALIZATION, STOCK SPLITS STOCK DIVIDENDS, ETC. If, after the effective date of this Plan, there shall be any changes in the common stock structure of the Company by reason of the declaration of stock dividends, recapitalization resulting in stock split-ups, or combina- tions or exchanges of shares by reason of merger, consolidation, or by any other means, then the number of shares available for options and stock appreciation rights, the shares subject to any options and the number of shares available for and subject to stock appreciation rights shall be equitably and appropriately adjusted by the Board of Directors of the Company as in its sole and uncontrolled discretion shall seem just and reasonable in the light of all the circumstances pertaining thereto. 13. RIGHT TO TERMINATE EMPLOYMENT The plan shall not confer upon any employee any right with respect to being continued in the employ of the Company and its subsidiaries or interfere in any way with the right of the Company and its subsidiaries to terminate his employment at any time, nor shall it interfere in any way with the employee's right to terminate his employment. 14. WITHHOLDING AND OTHER TAXES The Company or one of its subsidiaries shall have the right to withhold from salary or otherwise or to cause an Optionee (or the executor or administrator of his estate or his distributee) to make payment of any Federal, State, local or foreign taxes required to be withheld with respect to any exercise of a stock option or a stock appreciation right. An Optionee may irrevocably elect to have the withholding tax obligation or, if the Compensation Committee so determines, any additional tax obligation with respect to any exercise of a stock option satisfied by (a) having the Company or one of its subsidiaries withhold shares otherwise deliverable to the Optionee with respect to the exercise of the stock option, or (b) delivering back to the Company shares received upon the exercise of the stock option or delivering other shares of common stock; that any such election shall be made either (i) during a "ten-day window period", or (ii) at least six months prior to the date income is recognized with respect to the exercise of a stock option.
15. AMENDMENT TO THE PLAN The Board of Directors shall have the right to amend, suspend or terminate the Plan at any time; provided, however, that no such action shall affect or in any way impair the rights of the holder of any option or stock appreciation right theretofore granted under the Plan; and provided further, that unless first duly approved by the common shareholders of the Company entitled to vote thereon at a meeting (which may be the annual meeting) duly called and held for such purpose, no amendment or change shall be made in the Plan (a) increasing the total number of shares which may be purchased or transferred upon exercise of options or stock appreciation rights under the Plan by all employees; (b) changing the minimum purchase price hereinbefore specified for the optioned shares; (c) changing the maximum option period; (d) increasing the amount that may be received upon exercise of a stock appreciation right; or (e) allowing a stock appreciation right to be exercised after the expiration date of the related option. 16. EFFECTIVE DATE OF THE PLAN The Plan shall be effective as of February 24, 1971. 17. SAVINGS CLAUSE Nothing included in this Plan by amendment shall revoke or alter the terms and provisions of the Plan as in effect prior to such amendment with respect to options granted under the Plan prior thereto.
EXHIBIT 10 ----------
DIRECTOR'S PENSION PLAN Plan Provisions
Effective Date
January 1, 1994
Normal Retirement Date
The first of the month following attainment of Age 65
Normal Annual Pension 100% of annual retainer fee (currently $26,000 per year)
Termination Benefits
After vesting an annuity payable for life starting at the later of age 65 or termination from the Board.
Death Benefits
None
Preretirement Spouse's Death Benefits
None
Postretirement Spouse's Death Benefit
None
Disability Pension
50% of the Normal Annual Pension payable after 2 years of Credited Service. Increases by 10% per year for years of Credited Service over 5 years until it is 100% of the Normal Annual Pension. Credited Service does not accrue while on Disability.
Early Retirement Benefit
An unreduced accrued benefit is available upon attainment of age 65 and 5 years of Credited Service.
Eligibility
All Outside Members of the Board of Directors. An Outside Member is a board member who has never been employed by the Company or an affiliate of the Company.
Credited Service
One year of Credited Service is granted for each calender year in which a Board member is on the Board for at least four months and attends at least one Board Meeting.
Benefit Accrual
10% of the Normal Retirement Benefit for each year of Credited Service. A maximum of 100% after 10 years.
Vesting
Vesting Service equals Credited Service. Benefits vest after 5 years of Vesting Service.
Contributions
None
Forms of Payment
Life Annuity only
EXHIBIT 10 ----------
EXECUTIVE OFFICER'S RETIREMENT AGREEMENT
July 19, 1993
Robert F. Singleton 8496 Old Cutler Road Coral Gables, FL. 33143
Dear Bob:
This letter describes the conditions of your retirement agreement with Knight-Ridder, Inc.
1. Your current job, compensation and benefit arrangements will continue through September 30, 1993.
2. On September 30, 1993 you will retire as an officer and as a member of the Board Of Directors of Knight-Ridder, Inc.
3. Upon retirement, you will be paid for any accrued, but unused vacation time. You will also be paid a prorated bonus for 1993, based on the potential bonus, if any, you would have received had you not retired until the end of 1993. This bonus will be calculated on the basis of projected 1993 KRI performance computed on the basis of nine months actual, plus three months budget.
4. For a one-year period beginning October 1, 1993, you will serve as a consultant to the company, reporting to me, at an annual fee of $50,000. You will be available to Ross Jones the new CFO, and other officers of the company. You will continue to represent Knight-Ridder on the TKR Cable, TCI/TKR LP and Southeast Paper Manufacturing Company Management Committees during the period you serve Knight-Ridder as a consultant.
5. Effective October 1, 1993, you will receive an annual pension of $200,000 in the form of a 66 2/3% joint and survivor annuity (66 2/3% CA Option), comprising the following elements:
SENN Plan $ 88,082 BRP Plan 41,105 Special Retirement Agreement 70,813 -------- Total Annual Benefit $200,000 ========
6 Upon your retirement, you and your dependents will be covered under the Knight-Ridder medical and dental plans for retirees. Because you originally intended to retire under the medical plan for retirees that was effective prior to January 1, 1993, upon your retirement, you will be paid a one-time bonus of $86,806 representing the difference in present value costs to you of continuing coverage for you and your dependents under the new plan versus the old plan.
7. All normal travel and out-of pocket expenses incurred in carrying out your assignments for the company during the period October 1, 1993 through September 30, 1994, will be paid for by the company upon submission of expenses.
8. Outside directorships not in conflict with Knight-Ridder, Inc. will be cleared with me.
9. You may retain your personal computer and have free access to Dialog, Moneycenter and other agreed-upon KRI electronic services until March 20, 1995.
Accepted by: Knight-Ridder, Inc.
Robert F. Singleton James K. Batten - ----------------------- --------------------- Robert F. Singleton James K. Batten
Date: July 19, 1993 Date: July 19, 1993
EXECUTIVE OFFICER'S CONSULTING/RETIREMENT AGREEMENT EXHIBIT 19 ----------
September 20, 1989
Mr. Alvah H. Chapman, Jr. 4255 Lake Road Miami, Florida 33137
Dear Alvah: This letter sets forth our agreement with respect to your services to Knight-Ridder following your retirement as an officer and employee of the Company on October 1st.
You have agreed to continue to serve as a Director of the Company and as Chairman of its Executive Committee. I am also pleased that you have agreed to serve as a consultant to the company for the 12 months beginning October 1, 1989 and, thereafter, for such period as you, the Compensation Committee and I may agree.
In consideration of your services as Chairman of the Executive Committee and as a consultant, the Company will pay you $150,000 annually. This agree- ment extends from October 1, 1989 through September 30, 1994*. And as customary, you will be compensated as an outside director, including meeting fees for the Board and Board Committees (including the Executive Committee of the Company).
We have calculated that you will be entitled to an aggregate annual pension benefit under the Knight-Ridder Retirement and Benefit Restoration Plans of $328,670. In addition, in recognition of your contribution to the Company and your future services to it, the Company has agreed to pay you an additional retirement benefit of $100,000 per year for your life, in equal monthly installments.
Although I hope to be able to take full advantage of your broad range of experience and knowledge of the Company, it is understood between us that we will make only reasonable demands upon your time and will seek to schedule our requests for your counsel so as to accommodate your schedule of other activities in retirement.
The specific matters on which we will need your help necessarily will change from time to time. I anticipate that you and I will talk at least quarterly about your then current list of consultative duties. At the outset we look forward to your continued participation in (a) our Detroit JOA undertaking and I hope you will be willing to serve on the DNA Management Committee for at least a year following implementation; (b) our ongoing shareholder relations projects (with particular attention to the founding families); and (c) the Miami property development project. I know that there will be a number of other key issues where your counsel will be invaluable.
Our consulting relationship will preclude you from accepting consulting assignments and from other companies and from other profit-making activities, provided your other assignments and activities do not constitute a conflict of interest with Knight- Ridder.
The Company will reimburse you, in accordance with its usual policies and procedures, for your travel and other out of pocket expenses incurred in connection with your Knight-Ridder consulting activities, your attending ANPA and other industry meetings as long as you are a Knight- Ridder director, and your activities as Chairman of the FIU Foundation, Vice Chairman of The Miami Coalition, and other civic activities which are of benefit to KRI over the next several years.
In accordance with our historical practice, we will provide you as a former CEO of the Company with an office and a secretary as long as you want them.
I am happy we will continue to work together. If I have accurately summarized our understanding, I'd appreciate your signing and returning the enclosed copy of this letter to me for the Company's files.
Sincerely yours, Knight- Ridder, Inc.
By: James K. Batten ----------------- J.K. Batten President & CEO
Agreed:
Alvah H. Chapman Jr. - -------------------- Alvah H. Chapman, Jr. (*The initial agreement was for one year and has been renewed annually through September 30, 1994).
EXECUTIVE OFFICER'S RETIREMENT AGREEMENT EXHIBIT 19 (John C. Fontaine) ----------
AGREEMENT
THIS AGREEMENT made and entered into as of the 1st day of January, 1992, by and between John C. Fontaine (hereinafter referred to as "Mr. Fontaine") and Knight-Ridder, Inc. (hereinafter referred to as "KRI") WITNESSETH THAT:
WHEREAS Mr. Fontaine will work approximately nine-tenths (90%) of his time for KRI, commencing January 1, 1992; and,
WHEREAS KRI desires to provide Mr. Fontaine with an adequate pension benefit for his services;
1. KRI will pay to Mr. Fontaine an amount, payable in monthly installments, under this Agreement which, together with benefits earned under the Retirement Plan for Employees of Knight-Ridder, Inc. Corporate Division (the "Plan") will equal $135,000 annually if Mr. Fontaine retires at age 62 or $200,000 annually if Mr. Fontaine retires at age 65. These amounts are given on a life-only basis; they may be converted to any of the optional forms of benefit available under the Plan using the same conversion factors which would apply under the Plan.
2. In the event that the employment relationship ends prior to attainment of age 62 by Mr. Fontaine other than (a) by reason of Mr. Fontaine's death or disability or (b) following a change in the control of the company, a pension benefit commencing at age 65 will be payable. The amount of the benefit will be calculated by multiplying $200,000 by the ratio of years and completed months of service since August 1, 1987 to 9 years 3 months. In the event of retirement at or after age 62, a pension determined in the same manner will be payable commencing immediately (except that the benefit payable at age 62 will be $135,000). See Exhibits I and II. Amounts payable under optional payment forms are shown in Exhibit III.
3. In the event Mr. Fontaine's employment terminates by reason of his disability or following a change in the control of the company, he will be 100% vested immediately in the benefits provided under paragraph 2 above for retirement at age 65. In the event of Mr. Fontaine's death while
employed by KRI, there shall be paid to his surviving spouse for her life 50% of the amount which would otherwise be payable to him under this paragraph in the event of his disability; no beneficiary other than his surviving spouse shall be entitled to any death benefit under this Agreement. Benefit payments under this paragraph will commence on the first of the month following the occurrence of any of the above-mentioned circumstances. For purposes of this Agreement: (a) a "change in the control of the company" will be deemed to have occurred if the company is a party to a merger in which it is not the surviving entity or pursuant to which the company's common stock is converted into other property or securities; or upon the approval of the liquidation or dissolution of the company; or upon the sale of all or substantially all the company's assets; or upon the acquisition by any person or group of 35% of the company's outstanding stock; or upon a change within any 13- month period in the composition of a majority of the company's Board of Directors; and
(b) "disability" shall mean a physical or mental condition which prevents Mr. Fontaine from fully performing the duties of Senior Vice President and General Counsel as agreed to by him and the company for a period of 90 consecutive days.
4. This Agreement does not give Mr. Fontaine the right to be retained in the employ of KRI. Effective January 1, 1992, this Agreement supersedes the agreement between Mr. Fontaine and KRI concerning pension benefits dated October 16, 1989.
5. This Agreement does not give Mr. Fontaine other rights or benefits provided under the Plan except as set forth in paragraphs 1, 2 and 3 above.
6. Neither this Agreement nor any benefits that may be payable under this Agreement are assignable by Mr. Fontaine. None of Mr. Fontaine's rights under this Agreement shall be subject to any encumbrance or to the claims of his creditors.
7. This Agreement shall be governed and construed in accordance with the laws of the State of Florida.
8. Nothing contained in this Agreement shall be deemed to require KRI to make any payment to Mr. Fontaine or to any other person contrary to applicable law.
9. IN WITNESS WHEREOF, the parties hereto have hereunto set their hands to duplicates this 19th day of December, 1991. JOHN C. FONTAINE
John C. Fontaine ---------------- KNIGHT-RIDDER, INC.
By James K. Batten ------------------ James K. Batten Chairman & CEO
Exhibit 22 SUBSIDIARIES OF THE REGISTRANT ----------
State/Country of Incorporation --------------- KNIGHT-RIDDER, INC. Aberdeen News Company Delaware The Beacon Journal Publishing Company Ohio
Boca Raton News, Inc. Florida Boulder Publishing, Inc. Colorado The Bradenton Herald, Inc. Florida Circom Corporation Pennsylvania Detroit Free Press, Incorporated Michigan Detroit Newspaper Agency Michigan(partnership) Drinnon, Inc. Georgia Grand Forks Herald, Incorporated Delaware Journal of Commerce, Inc. Delaware Keynoter Publishing Company, Inc. Florida KR Newsprint Company Florida Southeast Paper Manufacturing Co. Georgia (partnership) Knight News Services, Inc. Michigan Knight-Ridder Tribune News Services District of Columbia (partnership) The Knight Publishing Co. Delaware Knight-Ridder Business Information Services, Inc. Delaware Knight-Ridder Financial, Inc. Delaware Commodity News Services (International), Inc. Delaware Knight-Ridder Financial Holding AEA Company, Inc. Delaware Knight-Ridder Financial AEA, Inc. Delaware Knight-Ridder Financial JM, Inc. Delaware Knight-Ridder Financial Japan, Inc. Delaware Knight-Ridder Financial Iberica, S.A. Spain Equinet Pty Ltd. Australia Equinet Information (NZ), Ltd. New Zealand Dialog Information Services, Inc. California Dialog Information Europe, Inc. California D-S Marketing UK, Ltd. United Kingdom D-S Marketing, Inc. Pennsylvania D-S Marketing, SARL France D-S Marketing, GMBH Germany Radio-Suisse Marketing AB Sweden Knight-Ridder Nova AG Switzerland Radio-Suisse Ltd. Switzerland Knight-Ridder Cablevision, Inc. Florida KRC Sub, Inc. Delaware SCI Cable Partners Colorado (partnership) TKR Cable Company Colorado (partnership)
Knight-Ridder Investment Company Delaware Seattle Times Company Delaware KR Video, Inc. Delaware Lexington Herald-Leader Co. Kentucky The Macon Telegraph Publishing Company Georgia The Miami Herald Publishing Company - News Publishing Company Indiana Fort Wayne Newspapers, Inc. Indiana Fort Wayne Newspaper Agency Indiana (partnership) Newspapers First Delaware Nittany Printing and Publishing Company Pennsylvania Northwest Publications, Inc. Delaware Duluth News-Tribune - Saint Paul Pioneer Press - The Observer Transportation Company North Carolina Philadelphia Newspapers, Inc. Pennsylvania Portage Graphics Co. Ohio Post-Tribune Publishing, Inc. Indiana PressLink Corporation Delaware The R.W. Page Corporation Georgia Ridder Publications, Inc. Delaware KR Land Holding Corporation Delaware San Jose Mercury News, Inc. California Silicon Valley D.A.T.A., Inc. California The State-Record Holding Company Delaware The State-Record Company, Inc. South Carolina Gulf Publishing Company, Inc. Mississippi Newberry Publishing Company, Inc. South Carolina Sun Publishing Company, Inc. South Carolina Tallahassee Democrat, Inc. Florida Tribune Newsprint Company Utah Ponderay Newsprint Company Washington (partnership) Twin Cities Newspaper Service, Inc. Minnesota Twin Coast Newspapers, Inc. New York Long Beach Press-Telegram - P.T. Sales and Marketing, Inc. California VU/TEXT Information Services, Inc. Florida Wichita Eagle and Beacon Publishing Company, Inc. Kansas
Exhibit 24 ----------
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in Registration Statement No. 33-11021 on Form S-3 dated December 22, 1986, in Registration Statement No. 33-28010 on Form S-3 dated April 7, 1989, in Registration Statement No. 33-31747 on Form S-8 dated October 30, 1989 and in Registration Statement No. 33-69206 on Form S-8 dated May 18, 1993, and in the related Prospectuses of our report dated February 1, 1994, with respect to the consolidated financial statements and schedules of Knight-Ridder, Inc. included in this Annual Report (Form 10-K) for the year ended December 26, 1993.
ERNST & YOUNG
March 22, 1994
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Gonzalo F. Valdes- Fauli Date: March 22, 1994 - ---------------------------- -------------------- Gonzalo F. Valdes-Fauli
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Bernard H. Ridder, Jr. Date: March 22, 1994 - --------------------------- -------------------- Bernard H. Ridder, Jr.
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Barbara Barnes Hauptfuhrer Date: March 22, 1994 - ------------------------------- -------------------- Barbara Barnes Hauptfuhrer
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Alvah H. Chapman, Jr. Date: March 22, 1994 - ------------------------ -------------------- Alvah H. Chapman, Jr.
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Peter C. Goldmark, Jr. Date: March 22, 1994 - ------------------------- -------------------- Peter C. Goldmark, Jr.
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
William S. Lee Date: March 22, 1994 - ------------------ -------------------- William S. Lee
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
John L. Weinberg Date: March 22, 1994 - -------------------- -------------------- John L. Weinberg
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Ben R. Morris Date: March 22, 1994 - ----------------- -------------------- Ben R. Morris
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Eric Ridder Date: March 22, 1994 - --------------- -------------------- Eric Ridder
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
James K. Batten Date: March 22, 1994 - ------------------- -------------------- James K. Batten
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Joan Ridder Challinor Date: March 22, 1994 - ------------------------- -------------------- Joan Ridder Challinor
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Jesse Hill, Jr. Date: March 22, 1993 - ------------------- -------------------- Jesse Hill, Jr.
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
C. Peter McColough Date: March 22, 1994 - ---------------------- -------------------- C. Peter McColough
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Thomas L. Phillips Date: March 22, 1994 - ----------------------- -------------------- Thomas L. Phillips
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
P. Anthony Ridder Date: March 22, 1994 - --------------------- -------------------- P. Anthony Ridder
Exhibit 25 ----------
POWER OF ATTORNEY
The undersigned member of the Board of Directors of Knight-Ridder, Inc. hereby constitutes and appoints John C. Fontaine, Ross Jones, and Tally C. Liu and each of them severally, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all Reports on Form 10-K (Annual Report pursuant to the Securities Exchange Act of 1934) and any amendments thereto, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Barbara Knight Toomey Date: March 22, 1994 - ------------------------- --------------------- Barbara Knight Toomey