Company: GHC
Filing Date: 2025-03-26
Form Type: DEF 14A
Source: 0001193125-25-063218
Chunk: 36

Company: Graham Holdings Co
Filing Date: 2025-03-26
Form: DEF 14A
Chunk 36
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 officers.

In 2024, the total annual bonus formula for the named executive officers, except for Mr. Rosen, was based on a diluted earnings per share target for the Company because the Committee believed that such a goal would align the interests of shareholders and the named executive officers in growing the value of the Company. Potential payouts ranged from 0% to 200% of target, with a threshold achievement of 80% of the diluted earnings per share target necessary for any amounts to be paid (which would be paid at a threshold level of 50%), and the maximum potential payout available in the event 140% of the diluted earnings per share target is attained. The Committee believes that the targets are challenging, but achievable, as evidenced by the fact that payouts have been at or above target in two out of the past five years.

The diluted earnings per share goal for 2024 was $61.88. In evaluating performance achievement, the actual results are subject to adjustment for certain items, to the extent that actual amounts for such items varied from those in the 2024 annual budget (whether to the detriment or the benefit of the Company). Specifically, these adjustments included deductions for a pension budget variance, unbudgeted net gains on marketable and other equity securities, and foreign exchange gains. These deductions were offset by unbudgeted goodwill and other long-lived asset impairment charges, losses on unbudgeted new acquisitions and investments, and a Kaplan stock compensation expense variance.

In addition, the Committee exercised its discretion to exclude certain unusual and unbudgeted items, including additions for an unbudgeted interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest at Graham Healthcare Group; unbudgeted impairments, losses and gains from equity and cost method investments, net; and unbudgeted costs at Hoover, Dekko, Saatchi Art and Code3. The Committee adjusted for these items as they do not relate to the regular operating results that are customarily considered by the Committee in determining bonus amounts. Page 54 of the Company’s 2024 Annual Report on Form 10-K, filed with the SEC on February 26, 2025, detailed $29.04 in diluted earnings per share additions, which comprise most of these discretionary items.

Taking into account these adjustments, the Company’s 2024 diluted earnings per share, as adjusted for purposes of the bonus determination, was $59.40 (compared to reported diluted earnings per share of $163.40), resulting in the Company