Exhibit 10.8

 

Gannett Co., Inc.

2001 Omnibus Incentive

Compensation Plan

 

Effective January 1, 2001

 

[Revised to reflect revisions through February 20, 2006]

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Contents

 

Article 1. Establishment, Objectives, and Duration

   1

Article 2. Definitions

   1

Article 3. Administration

   5

Article 4. Shares Subject to the Plan and Maximum Awards

   5

Article 5. Eligibility and Participation

   6

Article 6. Stock Options

   7

Article 7. Stock Appreciation Rights

   8

Article 8. Restricted Stock

   10

Article 9. Performance Units, Performance Shares, and Cash-Based Awards

   11

Article 10. Performance Measures

   12

Article 11. Beneficiary Designation

   13

Article 12. Deferrals

   13

Article 13. Rights of Employees/Directors

   13

Article 14. Termination of Employment/Directorship

   14

Article 15. Change in Control

   14

Article 16. Amendment, Modification, and Termination

   16

Article 17. Withholding

   17

Article 18. Successors

   17

Article 19. General Provisions

   17

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Gannett Co., Inc. 2001 Omnibus Incentive Compensation Plan

 

Article 1. Establishment, Objectives, and Duration

 

1.1 Establishment of the Plan. Gannett Co., Inc., a Delaware corporation
(hereinafter referred to as the “Company”), hereby establishes an incentive
compensation plan to be known as the “Gannett Co., Inc. 2001 Omnibus Incentive
Compensation Plan” (hereinafter referred to as the “Plan”), as set forth in this
document. The Plan permits the grant of Nonqualified Stock Options, Incentive
Stock Options, Stock Appreciation Rights, Restricted Stock, Performance Shares,
Performance Units, and Cash-Based Awards.

 

Subject to approval by the Company’s stockholders, the Plan shall become
effective as of January 1, 2001 (the “Effective Date”) and shall remain in
effect as provided in Section 1.3 hereof.

 

1.2 Objectives of the Plan. The objectives of the Plan are to optimize the
profitability and growth of the Company through annual and long-term incentives
that are consistent with the Company’s goals and that link the personal
interests of Participants to those of the Company’s stockholders, to provide
Participants with an incentive for excellence in individual performance, and to
promote teamwork among Participants.

 

The Plan is further intended to provide flexibility to the Company and its
Affiliates in their ability to motivate, attract, and retain the services of
Participants who make significant contributions to the Company’s success and to
allow Participants to share in that success.

 

1.3 Duration of the Plan. The Plan shall commence on the Effective Date and
shall remain in effect, subject to the right of the Committee to amend or
terminate the Plan at any time pursuant to Article 16 hereof, until all Shares
subject to it shall have been purchased or acquired according to the Plan’s
provisions. However, in no event may an Award be granted under the Plan on or
after the tenth (10th) anniversary of the Effective Date.

 

1.4 Prior Plans. Effective on May 8, 2001, no further awards shall be made under
the Company’s 1978 Executive Long-Term Incentive Plan or the 1968 Executive
Incentive Bonus Plan; provided, however, that any rights theretofore granted
under either such plan shall not be affected.

 

Article 2. Definitions

 

Whenever used in the Plan, the following terms shall have the meanings set forth
below, and when the meaning is intended, the initial letter of the word shall be
capitalized:

 

2.1 “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations of the Exchange Act.

 

2.2 “Award” means, individually or collectively, a grant under this Plan of
Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights,
Restricted Stock, Performance Shares, Performance Units, or Cash-Based Awards.

 

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2.3 “Award Agreement” means a written or electronic agreement entered into by
the Company and each Participant setting forth the terms and provisions
applicable to Awards granted under this Plan.

 

2.4 “Beneficial Owner” or “Beneficial Ownership” shall have the meaning ascribed
to such term in Rule 13d-3 of the General Rules and Regulations under the
Exchange Act.

 

2.5 “Board” or “Board of Directors” means the Board of Directors of the Company.

 

2.6 “Cash-Based Award” means an Award granted to a Participant as described in
Article 9 hereof.

 

2.7 “Change in Control” shall be deemed to have occurred under any one or more
of the following conditions:

 

i. if, within three years of any merger, consolidation, sale of a substantial
part of Gannett’s assets, or contested election, or any combination of the
foregoing transactions (a “Transaction”), the persons who were directors of
Gannett immediately before the Transaction shall cease to constitute a majority
of the Board of Directors (x) of Gannett or (y) of any successor to Gannett, or
(z) if Gannett becomes a subsidiary of or is merged into or consolidated with
another corporation, of such corporation (Gannett shall be deemed a subsidiary
of such other corporation if such other corporation owns or controls, directly
or indirectly, a majority of the combined voting power of the outstanding shares
of the capital stock of Gannett entitled to vote generally in the election of
directors (“Voting Stock”));

 

ii. if, as a result of a Transaction, Gannett does not survive as an entity, or
its shares are changed into the shares of another corporation;

 

iii. if any “person” (as that term is used in Section 13(d) or 14(d)(2) of the
Exchange Act) becomes a beneficial owner directly or indirectly of securities of
Gannett representing 20% or more of the combined voting power of Gannett’s
Voting Stock;

 

iv. if three or more persons are elected directors of Gannett despite the
opposition of a majority of the directors of Gannett then in office; or

 

v. upon determination by the Committee that a Change in Control has occurred, if
such a person as defined in subparagraph (iii) above becomes the beneficial
owner directly or indirectly of securities of Gannett representing from 12% up
to 20% of the combined voting power of Gannett’s Voting Stock.

 

Effective as of December 4, 2001, “Change in Control” shall have the same
definition as set forth in Section 5 of the Gannett Transitional Compensation
Plan, as that definition may be amended from time to time.

 

2.8 “Code” means the Internal Revenue Code of 1986, as amended from time to
time.

 

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2.9 “Committee” means any committee appointed by the Board to administer Awards
to Employees or Directors, as specified in Article 3 hereof.

 

2.10 “Company” means Gannett Co., Inc., a Delaware corporation and any successor
thereto as provided in Article 18 hereof.

 

2.11 “Covered Employee” means a Participant who, as of the date of vesting
and/or payout of an Award, as applicable, is one of the group of “covered
employees,” as defined in the regulations promulgated under Code Section 162(m),
or any successor statute.

 

2.12 “Director” means any individual who is a member of the Board of Directors
of the Company; provided, however, that any Director who is employed by the
Company shall be considered an Employee under the Plan.

 

2.13 “Disability” shall have the meaning ascribed to such term in the
Participant’s governing long-term disability plan, or if no such plan exists, at
the discretion of the Committee, or if different, as defined in the Employee’s
employment contract with the Company or any of its Affiliates or Subsidiaries.

 

2.14 “Effective Date” shall have the meaning ascribed to such term in
Section 1.1 hereof.

 

2.15 “Employee” means any employee of the Company or its Subsidiaries or
Affiliates.

 

2.16 “Exchange Act” means the Securities Exchange Act of 1934, as amended from
time to time, or any successor act thereto.

 

2.17 “Fair Market Value” as of any date and in respect of any Share means the
then most recent closing price of a Share reflected in the consolidated trading
tables of USA Today or any other publication selected by the Committee, provided
that, if Shares shall not have been traded on the New York Stock Exchange for
more than 10 days immediately preceding such date or if deemed appropriate by
the Committee for any other reason, the fair market value of Shares shall be as
determined by the Committee in such other manner as it may deem appropriate. In
no event shall the fair market value of any Share be less than its par value.

 

2.18 “Freestanding SAR” means an SAR that is granted independently of any
Options, as described in Article 7 hereof.

 

2.19 “Incentive Stock Option” or “ISO” means an option to purchase Shares
granted under Article 6 hereof and that is designated as an Incentive Stock
Option and that is intended to meet the requirements of Code Section 422.

 

2.20 “Insider” shall mean an individual who is, on the relevant date, an
executive officer, director or ten percent (10%) beneficial owner of any class
of the Company’s equity securities that is registered pursuant to Section 12 of
the Exchange Act, all as defined under Section 16 of the Exchange Act.

 

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2.21 “Nonqualified Stock Option” or “NQSO” means an option to purchase Shares
granted under Article 6 hereof and that is not intended to meet the requirements
of Code Section 422, or that otherwise does not meet such requirements.

 

2.22 “Option” means an Incentive Stock Option or a Nonqualified Stock Option, as
described in Article 6 hereof.

 

2.23 “Option Price” means the price at which a Share may be purchased by a
Participant pursuant to an Option.

 

2.24 “Participant” means an Employee or Director who has been selected to
receive an Award or who has outstanding an Award granted under the Plan.

 

2.25 “Performance-Based Exception” means the performance-based exception from
the tax deductibility limitations of Code Section 162(m).

 

2.26 “Performance Share” means an Award granted to a Participant, as described
in Article 9 hereof.

 

2.27 “Performance Unit” means an Award granted to a Participant, as described in
Article 9 hereof.

 

2.28 “Period of Restriction” means the period during which the transfer of
Shares of Restricted Stock is limited in some way (based on the passage of time,
the achievement of performance goals, or upon the occurrence of other events as
determined by the Committee, at its discretion), and the Shares are subject to a
substantial risk of forfeiture, pursuant to the Restricted Stock Award
Agreement, as provided in Article 8 hereof.

 

2.29 “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of
the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a
“group” as defined in Section 13(d) thereof.

 

2.30 “Restricted Stock” means an Award granted to a Participant pursuant to
Article 8 hereof.

 

2.31 “Retirement” means any retirement recognized under the Gannett Retirement
Plan or any successor plan thereto.

 

2.32 “Shares” means the Company’s common stock, par value $1.00 per share.

 

2.33 “Stock Appreciation Right” or “SAR” means an Award, granted alone or in
connection with a related Option, designated as an SAR, pursuant to the terms of
Article 7 hereof.

 

2.34 “Subsidiary” means any corporation, partnership, joint venture, or other
entity in which the Company has a majority voting interest.

 

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2.35 “Tandem SAR” means an SAR that is granted in connection with a related
Option pursuant to Article 7 hereof, the exercise of which shall require
forfeiture of the right to purchase a Share under the related Option (and when a
Share is purchased under the Option, the Tandem SAR shall similarly be
canceled).

 

Article 3. Administration

 

3.1 General. Subject to the terms and conditions of the Plan, the Plan shall be
administered by the Committee. The members of the Committee shall be appointed
from time to time by, and shall serve at the discretion of, the Board of
Directors. The Committee shall have the authority to delegate administrative
duties to officers of the Company.

 

3.2 Authority of the Committee. Except as limited by law or by the Certificate
of Incorporation or Bylaws of the Company, and subject to the provisions herein,
the Committee shall have full power to select Employees and Directors who shall
participate in the Plan; determine the sizes and types of Awards; determine the
terms and conditions of Awards in a manner consistent with the Plan; construe
and interpret the Plan and any agreement or instrument entered into under the
Plan; establish, amend, or waive rules and regulations for the Plan’s
administration; and amend the terms and conditions of any outstanding Award as
provided in the Plan. Further, the Committee shall make all other determinations
that it deems necessary or advisable for the administration of the Plan. As
permitted by law and the terms of the Plan, the Committee may delegate its
authority herein. No member of the Committee shall be liable for any action
taken or decision made in good faith relating to the Plan or any Award granted
hereunder.

 

3.3 Decisions Binding. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan and all related orders and resolutions of
the Committee shall be final, conclusive, and binding on all persons, including
the Company, its stockholders, Directors, Employees, Participants, and their
estates and beneficiaries, unless changed by the Board.

 

Article 4. Shares Subject to the Plan and Maximum Awards

 

4.1 Number of Shares Available for Grants. Subject to adjustment as provided in
Section 4.2 hereof, the number of Shares hereby reserved for issuance to
Participants under the Plan shall be thirty-two million five hundred thousand
(32,500,000), no more than five million (5,000,000) of which may be granted in
the aggregate in the form of Restricted Stock, Performance Shares and/or
Performance Units. The Committee shall determine the appropriate methodology for
calculating the number of shares issued pursuant to the Plan. Shares issued
under the Plan may be authorized but unissued shares or treasury shares. The
Plan also amends and restates the 1978 Executive Long-Term Incentive Plan and
the 1968 Executive Incentive Bonus Plan, each in its entirety (it being noted
that awards under such plans prior to May 8, 2001, shall not be impacted by this
amendment).

 

Unless the Committee determines that an Award to a Covered Employee shall not be
designed to comply with the Performance-Based Exception, the following rules
shall apply to grants of such Awards under the Plan:

 

  (a) Stock Options: The maximum aggregate number of Shares that may be granted
in the form of Stock Options, pursuant to any Award granted in any one fiscal
year to any one Participant shall be one million (1,000,000).

 

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  (b) SARs: The maximum aggregate number of Shares that may be granted in the
form of Stock Appreciation Rights, pursuant to any Award granted in any one
fiscal year to any one Participant shall be one million (1,000,000).

 

  (c) Restricted Stock: The maximum aggregate grant with respect to Awards of
Restricted Stock granted in any one fiscal year to any one Participant shall be
five hundred thousand (500,000).

 

  (d) Performance Shares/Performance Units and Cash-Based Awards: The maximum
aggregate grant with respect to Awards of Performance Shares made in any one
fiscal year to any one Participant shall be equal to the value of five hundred
thousand (500,000) shares; the maximum aggregate amount awarded with respect to
Cash-Based Awards or Performance Units to any one Participant in any one fiscal
year may not exceed ten million dollars ($10,000,000).

 

4.2 Adjustments in Authorized Shares. Upon a change in corporate capitalization,
such as a stock split, stock dividend or a corporate transaction, such as any
merger, consolidation, combination, exchange of shares or the like, separation,
including a spin-off, or other distribution of stock or property of the Company,
any reorganization (whether or not such reorganization comes within the
definition of such term in Code Section 368) or any partial or complete
liquidation of the Company, such adjustment shall be made in the number and
class of Shares that may be delivered under Section 4.1, in the number and class
of and/or price of Shares subject to outstanding Awards granted under the Plan,
and in the Award limits set forth in Section 4.1, as may be determined to be
appropriate and equitable by the Committee, in its sole discretion, to prevent
dilution or enlargement of rights.

 

4.3 Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
Events. The Committee may make adjustments in the terms and conditions of, and
the criteria included in, Awards in recognition of unusual or nonrecurring
events (including, without limitation, the events described in Section 4.2
hereof) affecting the Company or the financial statements of the Company or of
changes in applicable laws, regulations, or accounting principles, whenever the
Committee determines that such adjustments are appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan; provided that, unless the Committee determines
otherwise at the time such adjustment is considered, no such adjustment shall be
authorized to the extent that such authority would be inconsistent with the
Plan’s or any Award’s meeting the requirements of Section 162(m) of the Code, as
from time to time amended.

 

Article 5. Eligibility and Participation

 

5.1 Eligibility. Persons eligible to participate in this Plan include all
Employees and Directors.

 

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5.2 Actual Participation. Subject to the provisions of the Plan, the Committee
may, from time to time, select from all eligible Employees and Directors, those
to whom Awards shall be granted and shall determine the nature and amount of
each Award.

 

5.3 Newly Eligible Employees. The Committee shall be entitled to make such
rules, regulations, determinations and awards as it deems appropriate in respect
of any Employee who becomes eligible to participate in the Plan or any portion
thereof after the commencement of an award or incentive period.

 

5.4 Leaves of Absence. The Committee shall be entitled to make such rules,
regulations, and determinations as it deems appropriate under the Plan in
respect of any leave of absence taken by the recipient of any award. Without
limiting the generality of the foregoing, the Committee shall be entitled to
determine: (a) whether or not any such leave of absence shall constitute a
termination of employment within the meaning of the Plan; and (b) the impact, if
any, of such leave of absence on awards under the Plan theretofore made to any
recipient who takes such leave of absence.

 

Article 6. Stock Options

 

6.1 Grant of Options. Subject to the terms and provisions of the Plan, Options
may be granted to Participants in such number, and upon such terms, and at any
time and from time to time as shall be determined by the Committee.

 

6.2 Award Agreement. Each Option grant shall be evidenced by an Award Agreement
that shall specify the Option Price, the duration of the Option, the number of
Shares to which the Option pertains, and such other provisions as the Committee
shall determine which are not inconsistent with the terms of the Plan.

 

6.3 Option Price. The Option Price for each grant of an Option under this Plan
shall be as determined by the Committee; provided, however, the per-share
exercise price shall not be less than 100 percent of the Fair Market Value of
the Shares on the date the Option is granted.

 

6.4 Duration of Options. Each Option granted to a Participant shall expire at
such time as the Committee shall determine at the time of grant.

 

6.5 Exercise of Options. Options granted under this Article 6 shall be
exercisable at such times and be subject to such restrictions and conditions as
the Committee shall in each instance approve, which need not be the same for
each grant or for each Participant.

 

6.6 Payment. Options granted under this Article 6 shall be exercised by the
delivery of a written, electronic or telephonic notice of exercise to the
Company, setting forth the number of Shares with respect to which the Option is
to be exercised, accompanied by full payment for the Shares.

 

The Option Price upon exercise of any Option shall be payable to the Company in
full either: (a) in cash or its equivalent; or (b) by tendering previously
acquired Shares having an aggregate Fair Market Value at the time of exercise
equal to the total Option Price (provided that the Shares that are tendered must
have been held by the Participant for at least six (6) months prior to their
tender to

 

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satisfy the Option Price); or (c) by a combination of (a) and (b); or (d) any
other method approved by the Committee in its sole discretion. The tendering of
previously acquired shares may be done through attestation. No fractional shares
may be tendered or accepted in payment of the Option Price.

 

Cashless exercises are permitted pursuant to Federal Reserve Board’s Regulation
T, subject to applicable securities law restrictions, or by any other means
which the Committee determines to be consistent with the Plan’s purpose and
applicable law.

 

Subject to any governing rules or regulations, as soon as practicable after
receipt of notification of exercise and full payment, the Company shall deliver
to the Participant, in the Participant’s name, Share certificates in an
appropriate amount based upon the number of Shares purchased under the
Option(s).

 

Unless otherwise determined by the Committee, all payments under all of the
methods indicated above shall be paid in United States dollars.

 

6.7 Restrictions on Share Transferability. The Committee may impose such
restrictions on any Shares acquired pursuant to the exercise of an Option
granted under this Article 6 as it may deem advisable, including, without
limitation, restrictions under applicable federal securities laws, under the
requirements of any stock exchange or market upon which such Shares are then
listed and/or traded, or under any blue sky or state securities laws applicable
to such Shares.

 

6.8 Nontransferability of Options.

 

  (a) Incentive Stock Options. No ISO granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, all ISOs
granted to a Participant under the Plan shall be exercisable during his or her
lifetime only by such Participant.

 

  (b) Nonqualified Stock Options. Except as otherwise provided in a
Participant’s Award Agreement, no NQSO granted under this Article 6 may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant’s Award Agreement, all NQSOs granted to a
Participant under this Article 6 shall be exercisable during his or her lifetime
only by such Participant or such Participant’s legal representative.

 

Article 7. Stock Appreciation Rights

 

7.1 Grant of SARs. Subject to the terms and conditions of the Plan, SARs may be
granted to Participants at any time and from time to time as shall be determined
by the Committee. The Committee may grant Freestanding SARs, Tandem SARs, or any
combination of these forms of SAR.

 

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Subject to the terms and conditions of the Plan, the Committee shall have
complete discretion in determining the number of SARs granted to each
Participant and, consistent with the provisions of the Plan, in determining the
terms and conditions pertaining to such SARs.

 

The grant price of a Freestanding SAR shall equal the Fair Market Value of a
Share on the date of grant of the SAR. The grant price of Tandem SARs shall
equal the Option Price of the related Option.

 

7.2 SAR Agreement. Each SAR grant shall be evidenced by an Award Agreement that
shall specify the grant price, the term of the SAR, and such other provisions as
the Committee shall determine.

 

7.3 Term of SARs. The term of an SAR granted under the Plan shall be determined
by the Committee, in its sole discretion.

 

7.4 Exercise of Freestanding SARs. Freestanding SARs may be exercised upon
whatever terms and conditions the Committee, in its sole discretion, imposes
upon them.

 

7.5 Exercise of Tandem SARs. Tandem SARs may be exercised for all or part of the
Shares subject to the related Option upon the surrender of the right to exercise
the equivalent portion of the related Option. A Tandem SAR may be exercised only
with respect to the Shares for which its related Option is then exercisable.

 

7.6 Payment of SAR Amount. Upon exercise of an SAR, a Participant shall be
entitled to receive payment from the Company in an amount determined by
multiplying:

 

  (a) The difference between the Fair Market Value of a Share on the date of
exercise over the grant price; by

 

  (b) The number of Shares with respect to which the SAR is exercised.

 

In the sole discretion of the Committee, the payment upon SAR exercise may be in
cash, in Shares of equivalent value, in some combination thereof, or in any
other manner approved by the Committee. The Committee’s determination regarding
the form of SAR payout shall be set forth in the Award Agreement pertaining to
the grant of the SAR.

 

7.7 Nontransferability of SARs. Except as otherwise provided in a Participant’s
Award Agreement, no SAR granted under the Plan may be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or
by the laws of descent and distribution. Further, except as otherwise provided
in a Participant’s Award Agreement, all SARs granted to a Participant under the
Plan shall be exercisable during his or her lifetime only by such Participant or
such Participant’s legal representative.

 

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Article 8. Restricted Stock

 

8.1 Grant of Restricted Stock. Subject to the terms and provisions of the Plan,
the Committee, at any time and from time to time, may grant Shares of Restricted
Stock to Participants in such amounts, as the Committee shall determine.

 

8.2 Restricted Stock Agreement. Each Restricted Stock grant shall be evidenced
by a Restricted Stock Award Agreement that shall specify the Period(s) of
Restriction, the number of Shares of Restricted Stock granted, and such other
provisions as the Committee shall determine.

 

8.3 Transferability. Except as provided in this Article 8, the Shares of
Restricted Stock granted herein may not be sold, transferred, pledged, assigned,
or otherwise alienated or hypothecated until the end of the applicable Period of
Restriction established by the Committee and specified in the Restricted Stock
Award Agreement, or upon earlier satisfaction of any other conditions, as
specified by the Committee in its sole discretion and set forth in the
Restricted Stock Award Agreement. All rights with respect to the Restricted
Stock granted to a Participant under the Plan shall be available during his or
her lifetime only to such Participant or such Participant’s legal
representative.

 

8.4 Other Restrictions. The Committee shall impose such other conditions and/or
restrictions on any Shares of Restricted Stock granted pursuant to the Plan as
it may deem advisable including, without limitation, a requirement that
Participants pay a stipulated purchase price for each Share of Restricted Stock,
restrictions based upon the achievement of specific performance goals,
time-based restrictions on vesting following the attainment of the performance
goals, time-based restrictions, and/or restrictions under applicable federal or
state securities laws.

 

To the extent deemed appropriate by the Committee, the Company may retain the
certificates representing Shares of Restricted Stock in the Company’s possession
until such time as all conditions and/or restrictions applicable to such Shares
have been satisfied.

 

Except as otherwise provided in this Article 8, Shares of Restricted Stock
covered by each Restricted Stock grant made under the Plan shall become freely
transferable by the Participant after the last day of the applicable Period of
Restriction.

 

8.5 Voting Rights. If the Committee so determines, Participants holding Shares
of Restricted Stock granted hereunder may be granted the right to exercise full
voting rights with respect to those Shares during the Period of Restriction.

 

8.6 Dividends and Other Distributions. During the Period of Restriction,
Participants holding Shares of Restricted Stock granted hereunder may, if the
Committee so determines, be credited with dividends paid with respect to the
underlying Shares while they are so held. The Committee may apply any
restrictions to the dividends that the Committee deems appropriate. Without
limiting the generality of the preceding sentence, if the grant or vesting of
Restricted Shares granted to a Covered Employee is designed to comply with the
requirements of the Performance-Based Exception, the Committee may apply any
restrictions it deems appropriate to the payment of dividends declared with
respect to such Restricted Shares, such that the dividends and/or the Restricted
Shares maintain eligibility for the Performance-Based Exception.

 

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Article 9. Performance Units, Performance Shares, and Cash-Based Awards

 

9.1 Grant of Performance Units/Shares and Cash-Based Awards. Subject to the
terms of the Plan, Performance Units, Performance Shares, and/or Cash-Based
Awards may be granted to Participants in such amounts and upon such terms, and
at any time and from time to time, as shall be determined by the Committee.

 

9.2 Award Agreement. At the Committee’s discretion, each grant of Performance
Units/Shares and Cash-Based Awards may be evidenced by an Award Agreement that
shall specify the initial value, the duration of the Award, the performance
measures, if any, applicable to the Award, and such other provisions as the
Committee shall determine which are not inconsistent with the terms of the Plan.

 

9.3 Value of Performance Units/Shares and Cash-Based Awards. Each Performance
Unit shall have an initial value that is established by the Committee at the
time of grant. Each Performance Share shall have an initial value equal to the
Fair Market Value of a Share on the date of grant. Each Cash-Based Award shall
have a value as may be determined by the Committee. The Committee shall set
performance goals in its discretion which, depending on the extent to which they
are met, will determine the number and/or value of Performance Units/Shares and
Cash-Based Awards that will be paid out to the Participant. For purposes of this
Article 9, the time period during which the performance goals must be met shall
be called a “Performance Period.”

 

9.4 Earning of Performance Units/Shares and Cash-Based Awards. Subject to the
terms of this Plan, after the applicable Performance Period has ended, the
holder of Performance Units/Shares and Cash-Based Awards shall be entitled to
receive payout on the number and value of Performance Units/Shares and
Cash-Based Awards earned by the Participant over the Performance Period, to be
determined as a function of the extent to which the corresponding performance
goals have been achieved. Unless otherwise determined by the Committee,
notwithstanding any other provision of the Plan, payment of Cash-Based Awards
shall only be made for those Participants who are Directors or in the employ of
the Company at the end of the Performance Period or, if none has been specified,
the end of the applicable award year.

 

9.5 Form and Timing of Payment of Performance Units/Shares and Cash-Based
Awards. Payment of earned Performance Units/Shares and Cash-Based Awards shall
be as determined by the Committee and, if applicable, as evidenced in the
related Award Agreement. Subject to the terms of the Plan, the Committee, in its
sole discretion, may pay earned Performance Units/Shares and Cash-Based Awards
in the form of cash or in Shares (or in a combination thereof) that have an
aggregate Fair Market Value equal to the value of the earned Performance
Units/Shares and Cash-Based Awards at the close of the applicable Performance
Period. Such Shares may be granted subject to any restrictions deemed
appropriate by the Committee. No fractional shares will be issued. The
determination of the Committee with respect to the form of payout of such Awards
shall be set forth in the Award Agreement pertaining to the grant of the Award.

 

Unless otherwise provided by the Committee, Participants holding Performance
Units/Shares may be entitled to receive dividend units with respect to dividends
declared with respect to the Shares. Such dividends may be subject to the same
accrual, forfeiture, and payout restrictions as

 

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apply to dividends earned with respect to Shares of Restricted Stock, as set
forth in Section 8.6 hereof, as determined by the Committee.

 

9.6 Nontransferability. Except as otherwise provided in a Participant’s Award
Agreement, Performance Units/Shares and Cash-Based Awards may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant’s Award Agreement, a Participant’s rights
under the Plan shall be exercisable during the Participant’s lifetime only by
such Participant or such Participant’s legal representative.

 

Article 10. Performance Measures

 

Unless and until the Committee proposes for shareholder vote and shareholders
approve a change in the general performance measures set forth in this Article
10, the attainment of which may determine the degree of payout and/or vesting
with respect to Awards to Covered Employees that are designed to qualify for the
Performance-Based Exception, the performance measure(s) to be used for purposes
of such grants shall be chosen from among:

 

  (a) Earnings per share;

 

  (b) Net income (before or after taxes);

 

  (c) Net income from continuing operations;

 

  (d) Return measures (including, but not limited to, return on assets, equity,
capital or investment);

 

  (e) Cash flow (including, but not limited to, operating cash flow and free
cash flow);

 

  (f) Cash flow return on investments, which equals net cash flows divided by
owner’s equity;

 

  (g) Earnings before or after taxes, interest, depreciation and/or
amortization;

 

  (h) Internal rate of return or increase in net present value;

 

  (i) Dividend payments;

 

  (j) Gross revenues;

 

  (k) Gross margins;

 

  (l) Operating measures such as growth in circulation, television ratings and
advertising lineage;

 

  (m) Internal measures such as achieving a diverse workforce;

 

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  (n) Share price (including, but not limited to, growth measures and total
shareholder return); and

 

  (o) Any of the above measures compared to peer or other companies.

 

Performance measures may be set either at the corporate level, division level,
or the business unit level.

 

Awards that are designed to qualify for the Performance-Based Exception, and
that are held by Covered Employees, may not be adjusted upward (the Committee
shall retain the discretion to adjust such Awards downward).

 

If applicable tax and/or securities laws change to permit Committee discretion
to alter the governing performance measures without obtaining shareholder
approval of such changes, the Committee shall have sole discretion to make such
changes without obtaining shareholder approval.

 

Article 11. Beneficiary Designation

 

Each Participant under the Plan may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case of his or her death before he or
she receives any or all of such benefit. Each such designation shall revoke all
prior designations by the same Participant, shall be in a form prescribed by the
Company, and will be effective only when filed by the Participant in writing
with the Company during the Participant’s lifetime. If a beneficiary designation
has not been made, or the beneficiary was not properly designated (in the sole
discretion of the Committee), has died or cannot be found, all payments after
death shall be paid to the Participant’s estate. In case of disputes over the
proper beneficiary, the Company reserves the right to make any or all payments
to the Participant’s estate.

 

Article 12. Deferrals

 

The Committee may permit or require a Participant to defer such Participant’s
receipt of the payment of cash or the delivery of Shares that would otherwise be
due to such Participant by virtue of the exercise of an Option or SAR, the lapse
or waiver of restrictions with respect to Restricted Stock, or the satisfaction
of any requirements or goals with respect to Performance Units/Shares and
Cash-Based Awards. If any such deferral election is required or permitted, the
Committee shall, in its sole discretion, establish rules and procedures for such
payment deferrals.

 

Article 13. Rights of Employees/Directors

 

13.1 Employment. Nothing in the Plan shall confer upon any Participant any right
to continue in the Company’s employ, or as a Director, or interfere with or
limit in any way the right of the Company to terminate any Participant’s
employment or directorship at any time.

 

13.2 Participation. No Employee or Director shall have the right to be selected
to receive an Award under this Plan, or, having been so selected, to be selected
to receive a future Award.

 

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13.3 Rights as a Stockholder. Except as provided in Sections 8.5, 8.6 and 9.5, a
Participant shall have none of the rights of a shareholder with respect to
shares of Common Stock covered by any Award until the Participant becomes the
record holder of such shares.

 

Article 14. Termination of Employment/Directorship

 

Each Participant’s Award Agreement shall set forth the extent to which the
Participant shall have the right to such Participant’s outstanding Award(s)
following termination of the Participant’s employment or directorship with the
Company. Such provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreements entered into with each
Participant, need not be uniform among all Awards issued pursuant to the Plan,
and may reflect distinctions based on the reasons for termination.

 

Article 15. Change in Control

 

15.1 Treatment of Outstanding Awards Other than Cash-Based Awards. In the event
of a Change in Control, unless otherwise specifically prohibited under
applicable laws, or by the rules and regulations of any governing governmental
agencies or national securities exchanges, or unless the Committee shall
determine otherwise in the Award Agreement:

 

  (a) Any and all Options and SARs granted hereunder shall become fully
exercisable during their remaining term;

 

  (b) Any restriction periods and restrictions imposed on Restricted Stock that
are not performance-based shall lapse; and

 

  (c) The target payout opportunities attainable under all outstanding Awards of
performance-based Restricted Stock, Performance Units and Performance Shares
shall be deemed to have been fully earned for the entire Performance Period(s)
as of the effective date of the Change in Control. The vesting of all such
Awards denominated in Shares shall be accelerated as of the effective date of
the Change in Control and, subject to Section 15.4, there shall be paid out to
Participants within thirty (30) days following the effective date of the Change
in Control, a pro rata number of shares based upon an assumed achievement of all
relevant targeted performance goals and upon the length of time within the
Performance Period that has elapsed prior to the Change in Control. Subject to
Section 15.4, such Awards denominated in cash shall be paid pro rata to
Participants in cash within thirty (30) days following the effective date of the
Change in Control, with the proration determined as a function of the length of
time within the Performance Period that has elapsed prior to the Change in
Control, and based on an assumed achievement of all relevant targeted
performance goals.

 

15.2 Treatment of Cash-Based Awards. In the event of a Change in Control, unless
otherwise specifically prohibited under applicable laws, or by the rules and
regulations of any governing governmental agencies or national securities
exchanges, or unless the Committee shall determine otherwise in the Award
Agreement or resolutions adopted by

 

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the Committee relating to such Award, the vesting of all outstanding Cash-Based
Awards shall be accelerated as of the effective date of the Change in Control
(and, in the case of performance-based Cash-Based Awards, based on an assumed
achievement of all relevant target performance goals), and subject to
Section 15.4, all Cash-Based Awards shall be paid pro rata to Participants in
cash within thirty (30) days following the effective date of the Change in
Control, with the proration determined as a function of the length of time
within the Performance Period that has elapsed prior to the Change in Control.

 

15.3 Limitation on Acceleration.

 

  (a) Intention of Section 15.3: The acceleration or payment of Awards could, in
certain circumstances, subject the Participant to the excise tax provided under
Section 4999 of the Code. It is the object of this Section 15.3 to enable each
Participant to retain in full the benefits of the Plan and to provide for the
maximum after-tax income to each Participant. Accordingly, the Participant must
determine, before any payments are made on Awards governed by Section 15.1,
which of two alternative forms of acceleration will maximize the Participant’s
after-tax proceeds, and must notify the Company in writing of his or her
determination. The first alternative is the payment in full of all Awards
governed by Section 15.1. The second alternative is the payment of only a part
of the Participant’s Awards so that the Participant receives the largest payment
possible without causing an excise tax to be payable by the Participant under
Section 4999 of the Code. This second alternative is referred to in this Section
as “Limited Vesting”.

 

  (b) Limitation on Participant’s Rights: The Participant’s Awards shall be paid
only to the extent permitted under the alternative determined by the Participant
to maximize his or her after-tax proceeds, and the Participant shall have no
rights to any greater payments on his or her Awards.

 

  (c) Determination to be Conclusive: The determination of whether Limited
Vesting is required and the application of the rules in Section 15.4 shall
initially be made by the Participant and all such determinations shall be
conclusive and binding on the Company unless the Company proves that they are
clearly erroneous. In the latter event, such determinations shall be made by the
Company.

 

15.4 Limitation on Payment. Notwithstanding Section 15.1, if Limited Vesting
applies then the amount paid on exercise or payment of an Award shall not exceed
the largest amount that can be paid without causing an excise tax to be payable
by the Participant under Section 4999 of the Code. If payments are so limited,
awards shall be deemed paid in the following order:

 

  (a) all exercised Options or SARs that were accelerated pursuant to
Section 15.1(a) shall be deemed paid first;

 

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  (b) all awards of Performance Units, Performance Shares and performance-based
Restricted Stock shall then be deemed paid; and

 

  (c) finally, all awards of Restricted Stock that are not performance-based
shall be deemed paid.

 

As among awards or portions of awards of the same type, those vesting at the
most distant time in the future (absent a Change in Control) shall be deemed
paid first.

 

15.5 Expenses. The Company shall pay all legal fees, court costs, fees of
experts and other costs and expenses when incurred by a Participant in
connection with any actual, threatened or contemplated litigation or legal,
administrative or other proceeding involving the provisions of Section 15.4,
whether or not initiated by the Participant.

 

15.6 Termination, Amendment, and Modifications of Change-in-Control Provisions.
Notwithstanding any other provision of this Plan or any Award Agreement
provision, the provisions of this Article 15 may not be terminated, amended, or
modified on or after the date of a Change in Control to affect adversely any
Award theretofore granted under the Plan without the prior written consent of
the Participant with respect to said Participant’s outstanding Awards; provided,
however, the Committee may terminate, amend, or modify this Article 15 at any
time and from time to time prior to the date of a Change in Control.

 

Article 16. Amendment, Modification, and Termination

 

16.1 Amendment, Modification, and Termination. Subject to the terms of the Plan,
the Committee or the Board may at any time and from time to time, alter, amend,
suspend, or terminate the Plan in whole or in part.

 

16.2 Awards Previously Granted. Notwithstanding any other provision of the Plan
to the contrary, no termination, amendment, or modification of the Plan shall
adversely affect in any material way any Award previously granted under the
Plan, without the written consent of the Participant holding such Award.

 

16.3 Shareholder Approval Required for Certain Amendments. Shareholder approval
will be required for any amendment of the Plan that does any of the following:
(a) permits the grant of any Option with an Option Price less than the Fair
Market Value of the Shares on the date of grant; or (b) reduces the Option Price
of an outstanding Option, either by lowering the Option Price or by canceling an
outstanding Option and granting a replacement Option with a lower exercise
price.

 

16.4 Compliance with Code Section 162(m). At all times when Code Section 162(m)
is applicable, to the extent the Committee so determines, all Awards granted
under this Plan to Employees who are or could reasonably become Covered
Employees as determined by the Committee shall comply with the requirements of
Code Section 162(m). In addition, if changes are made to Code Section 162(m) to
permit greater flexibility with respect to any Award or Awards available under
the Plan, the Committee may, subject to this Article 16, make any adjustments it
deems appropriate.

 

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Article 17. Withholding

 

17.1 Tax Withholding. The Company shall have the power and the right to deduct
or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy the Federal statutory minimum, state, and local taxes,
domestic or foreign, required by law or regulation to be withheld with respect
to any taxable event arising as a result of this Plan. The Participant may
satisfy, totally or in part, his obligations pursuant to this Section 17.1 by
electing to have Shares withheld, to redeliver Shares acquired under an Award,
or to deliver previously owned Shares, provided that the election is made in
writing on or prior to (i) the date of exercise, in the case of Options and
SAR’s (ii) the date of payment, in respect of Performance Units/Shares, or
Cash-Based Awards, and (iii) the expiration of the incentive period, in respect
of Restricted Stock. Any election made under this Section 17.1 shall be
irrevocable by the Participant and may be disapproved by the Committee at any
time in its sole discretion. If an election is disapproved by the Committee, the
Participant must satisfy his obligations pursuant to this paragraph in cash.

 

Article 18. Successors

 

All obligations of the Company under the Plan with respect to Awards granted
hereunder shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the
business, stock and/or assets of the Company.

 

Article 19. General Provisions

 

19.1 Gender and Number. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.

 

19.2 Severability. If any provision of the Plan shall be held illegal or invalid
for any reason, the illegality or invalidity shall not affect the remaining
parts of the Plan, and the Plan shall be construed and enforced as if the
illegal or invalid provision had not been included.

 

19.3 Requirements of Law. The granting of Awards and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required.

 

19.4 Securities Law Compliance. With respect to Insiders, transactions under
this Plan are intended to comply with all applicable conditions of Rule 16b-3 or
its successors under the Exchange Act, unless determined otherwise by the Board.
To the extent any provision of the Plan or action by the Committee fails to so
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Board.

 

19.5 Listing. The Company may use reasonable endeavors to register Shares
allotted pursuant to the exercise of an Option with the United States Securities
and Exchange Commission or to effect compliance with the registration,
qualification, and listing requirements of any national securities laws, stock
exchange, or automated quotation system.

 

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19.6 Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company’s counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

 

19.7 No Additional Rights. Neither the Award nor any benefits arising under this
Plan shall constitute part of an employment contract between the Participant and
the Company or any Subsidiary or Affiliate, and accordingly, subject to
Section 16.2, this Plan and the benefits hereunder may be terminated at any time
in the sole and exclusive discretion of the Committee without giving rise to
liability on the part of the Company or any Affiliate for severance payments.

 

19.8 Employees Based Outside of the United States. Notwithstanding any provision
of the Plan to the contrary, to comply with provisions of laws in other
countries in which the Company, its Affiliates, and its Subsidiaries operate or
have Employees, the Committee, in its sole discretion, shall have the power and
authority to:

 

  (a) Determine which Affiliates and Subsidiaries will be covered by the Plan or
relevant subplans;

 

  (b) Determine which Employees employed outside the United States are eligible
to become Participants in the Plan;

 

  (c) Modify the terms and conditions of any Award granted to Participants who
are employed outside the United States;

 

  (d) Establish subplans, modified exercise procedures, and other terms and
procedures to the extent such actions may be necessary, advisable or convenient,
or to the extent appropriate to provide maximum flexibility for the
Participant’s financial planning. Any subplans and modifications to the Plan
terms or procedures established under this Section 19.8 by the Committee shall
be filed with the Plan document as Appendices; and

 

  (e) Take any action, before or after an Award is made, which the Committee
deems advisable to obtain, comply with, or otherwise reflect any necessary
governmental regulatory procedures, exemptions or approvals, as they may affect
this Plan, any subplan, or any Participant.

 

19.9 Uncertificated Shares. To the extent that the Plan provides for issuance of
certificates to reflect the transfer of Shares, the transfer of such Shares may
be effected on a noncertificated basis, to the extent not prohibited by
applicable law or the rules of any stock exchange.

 

19.10 Governing Law. The Plan and each Award Agreement shall be governed by the
laws of the State of Delaware, excluding any conflicts or choice of law rule or
principle that might otherwise refer construction or interpretation of the Plan
to the substantive law of another jurisdiction. Unless otherwise provided in the
Award Agreement, recipients of an Award under the Plan are deemed to submit to
the exclusive jurisdiction and venue of the federal or state courts located in
the Commonwealth of Virginia, County of Fairfax, to resolve any and all issues
that may arise out of or relate to the Plan or any related Award Agreement.

 

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