Exhibit 10.1

 

THE WASHINGTON POST COMPANY

 

STOCK OPTION PLAN

 

As Amended and Restated

Effective May 31, 2003

 

1. Purpose of the Plan

 

The purpose of this Stock Option Plan (hereinafter called the Plan) of The
Washington Post Company, a Delaware corporation (hereinafter called the
Company), is to secure for the Company and its stockholders the benefits of
incentive inherent in the ownership of Class B Common Stock of the Company by
employees of the Company and its subsidiaries who will be responsible for its
future growth and continued success. It is generally recognized that stock
option plans aid in retaining and encouraging key employees of ability and in
attracting other able employees.

 

2. Stock Subject to the Plan

 

There are hereby authorized and reserved for issuance upon the exercise of
options to be granted from time to time under the Plan an aggregate of 1,900,000
shares* of the Company’s Class B Common Stock, which shares may be in whole or
in part, as the Board of Directors shall from time to time determine, issued
shares which shall have been reacquired by the Company or authorized but
unissued shares, whether now or hereafter authorized. If any option granted
under the Plan shall expire, terminate or be canceled for any reason without
having been exercised in full, the corresponding number of unpurchased shares
which were reserved for issuance upon exercise thereof shall again be available
for the purposes of the Plan. To the extent that options provide that the
exercise of one shall reduce the number of shares purchasable under the other,
then, for purposes of the Plan, the Company shall be deemed to have awarded
options only for the aggregate number of shares which in fact may be purchased
under such options (and not for the number of shares covered by both such
options).

 

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* Adjusted to give effect to stock splits in 1971, 1976 and 1978.

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3. Administration of the Plan

 

The Plan shall be administered by the Committee referred to in paragraph 4
(hereinafter called the Committee). Subject to the express provisions of the
Plan, the Committee shall have plenary authority, in its discretion, to
determine the individuals to whom, and the time or times at which, options shall
be granted and the number of shares to be subject to each option. In making such
determinations, the Committee may take into account the nature of the services
rendered or expected to be rendered by the respective employees, their present
and potential contributions to the Company’s success, the anticipated number of
years of effective service remaining and such other factors as the Committee in
its discretion shall deem relevant. Subject to the express provisions of the
Plan, the Committee shall also have plenary authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it, to determine
the terms and provisions of the respective options (which terms and provisions
need not be the same in each case), and to make all other determinations deemed
necessary or advisable in administering the Plan. The determinations of the
Committee on the matters referred to in this paragraph 3 shall be conclusive.

 

4. The Committee

 

The Committee shall consist of not less than three members of the Board of
Directors, each of whom shall be a “disinterested” person within the meaning of
Rule 16b-3 of the Securities Exchange Act of 1934, as amended (or any successor
rule or regulation). No member of the Committee shall be eligible to receive an
option under the Plan. The Committee shall be appointed by the Board of
Directors, which may from time to time appoint members to the Committee in
substitution for or in addition to members previously appointed and may fill
vacancies, however caused, in the Committee; the Board of Directors shall also
designate one of the members of the Committee as its Chairman. The Committee
shall hold its meetings at such times and places as it may determine. A majority
of its members shall constitute a quorum. All determinations of the Committee
shall be made by a majority of its members. Any decision or determination
reduced to writing and signed by all the members shall be fully as effective as
if it had been made by a majority vote at a meeting duly called and held. The
Committee may appoint a secretary (who need not be a member of the Committee)
and may make such rules and regulations for the conduct of its business as it
shall deem advisable. No member of the Committee shall be liable, in the absence
of bad faith, for any act or omission with respect to his service on the
Committee. Service on the Committee shall constitute service as a Director of
the Company so that the members of the Committee shall be entitled to
indemnification and reimbursement as Directors of the Company pursuant to its
Certificate of Incorporation.

 

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5. Time of Granting of Options

 

Nothing contained in the Plan or in any resolution adopted or to be adopted by
the Board of Directors or by the stockholders of the Company shall constitute
the granting of any option hereunder. The action of the Committee with respect
to the granting of an option shall take place on such date as a majority of the
members of the Committee at a meeting shall make a determination with respect to
the granting of an option or, in the absence of a meeting, on such date as a
written Designation covering such option shall have been executed by all the
members of the Committee. The effective date of the grant of an option
(hereinafter called the Granting Date) shall be the date specified by the
Committee in its determination or Designation relating to the award of such
option.

 

6. Eligibility

 

Options may be granted only to key employees (which term shall be deemed to
include officers) who on the Granting Date are in the employ of the Company or
one of its present or future subsidiary corporations, as defined in Section 424
of the Internal Revenue Code of 1986, as the same shall be amended from time to
time (hereinafter called Subsidiaries). A Director of the Company or of a
Subsidiary who is not also such an employee of the Company or one of its
Subsidiaries shall not be eligible to receive an option. During the life of the
Plan options may be granted to eligible employees whether or not they hold or
have held options under the Plan or other options previously granted by the
Company.

 

7. Option Prices

 

The purchase price of the Class B Common Stock under each option shall be
determined by the Committee, but shall not be less than 100% of the fair market
value of the Class B Common Stock on the Granting Date of such option, as
determined by the Committee. The purchase price of shares purchased upon the
exercise of an option is to be paid in full upon the issuance of such shares,
either in cash or by the surrender of whole shares of Class B Common Stock
having a fair market value, as determined by the Committee, equal to such
purchase price, or by a combination of cash and whole shares. If paid in cash,
the purchase price paid for stock upon the exercise of options shall be added to
the general funds of the Company and used for corporate purposes. If paid in
whole or in part in shares, the shares surrendered shall be held as Treasury
shares.

 

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In the alternative, the Committee may, in its discretion at any time, determine
whether to permit an optionee the right to elect to make a “cashless exercise”
of all or some portion of an option by tendering to the Company some or all of
the vested otherwise exercisable portion of the option in return for a cash
payment from the Company equal to the positive difference, if any, between the
fair market value of the number of shares of Class B Common Stock covered by
such tendered portion of the option and the aggregate option price attributable
to such shares. The Company shall cause appropriate tax withholding to be made
with respect to any such cash payment upon a “cashless exercise” of an option by
withholding the appropriate amount from the aggregate proceeds made available
through the “cashless exercise.” Finally, an optionee may direct, in connection
with a “cashless exercise,” that some or all of the cash otherwise payable to
the optionee from the Company be instead applied to the payment of the option
price of shares of Class B Common Stock with respect to which the optionee has a
vested currently exercisable option and which are not the subject of the current
“cashless exercise.” As such, the optionee would be using the value inherent in
some existing options to create a source for funding the exercise of other
options. The Company shall effectuate appropriate income tax withholding with
respect to any “cashless exercise” used to fund the purchase of shares of Class
B Common Stock by withholding the appropriate amount from the aggregate proceeds
made available through the “cashless exercise” (including the amount of tax
withholding required with respect to the purchase of such additional shares of
Class B Common Stock) and applying the remaining amount of consideration to the
purchase of additional shares of Class B Common Stock.

 

8. Option Types, Terms and Conditions

 

Options granted under the Plan shall be in the form of non-qualified stock
options. The term of each option shall be for such period as the Committee shall
determine but not more than ten years from the Granting Date, subject to earlier
termination as the Committee may determine and as provided in paragraphs 10 and
11 hereof.

 

The Committee shall, in its discretion, prescribe the terms and conditions upon
which options may be exercised, which terms and provisions need not be the same
in each case. Except as provided in paragraphs 10 and 11 below, no option may be
exercised at any time unless the holder thereof is then an employee of the
Company or of a Subsidiary. An employee shall have none of the rights of a
stockholder with respect to any of the shares subject to option until such
shares shall be issued to him upon the exercise of his option.

 

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The Committee may grant to holders of outstanding options, in exchange for the
surrender and cancellation of such options, new options having purchase prices
lower than the purchase prices provided in the options so surrendered and
canceled and containing such other terms and conditions as the Committee may
prescribe in accordance with the provisions of the Plan; provided that such new
options shall provide for the purchase of not more than 90% of the number of
shares covered by the options so surrendered and canceled and that the purchase
price under such new options shall be determined in accordance with paragraph 7
hereof.

 

The maximum number of shares subject to options which may be granted under this
Plan to any individual employee during the life of this Plan shall not exceed
75,000 in the aggregate.

 

9. Non-Transferability of Options

 

No option granted under the Plan shall be transferable otherwise than by will or
the laws of descent and distribution and an option may be exercised, during the
lifetime of the holder thereof, only by him.

 

10. Termination of Employment

 

In the event that the employment of an employee to whom an option has been
granted under the Plan shall be terminated (otherwise than by reason of death),
such option may, subject to the provisions of paragraphs 8 and 12, be exercised
(only to the extent that the employee was entitled to do so at the termination
of his employment) at any time within three months after such termination, but
in no event after the expiration of the term of the option. Notwithstanding the
foregoing, the Committee may permit any option granted to an employee whose
employment is being terminated (otherwise than by reason of death) to remain
exercisable for such period as the Committee shall determine, but in no event
beyond the expiration of the term of the option. In the event the Committee so
extends the exercise period of an option held by a terminating employee and such
option is exercisable as to additional shares in installments, such installments
shall continue to accrue after the termination of employment unless the
Committee determines that the exercise period shall be extended only with
respect to the number of shares purchasable at the date of the termination of
employment. Options granted under the Plan shall not be affected by any change
of employment so long as the holder continues to be an employee of the Company
or of a Subsidiary. Retirement pursuant to any retirement plan of the Company or
any Subsidiary shall be deemed to be a termination of employment for the
purposes of this paragraph. The Committee may specify

 

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in the original terms of an option, or if not so specified shall determine,
whether any authorized leave of absence or absence on military or governmental
service or for any other reason shall constitute a termination of employment for
purposes of this paragraph. Nothing in the Plan or in any option granted
pursuant to the Plan (in the absence of an express provision to the contrary)
shall confer on any individual any right to continue in the employ of the
Company or any of its Subsidiaries or interfere in any way with the right of the
Company or any of its Subsidiaries to terminate his employment at any time.

 

11. Death of Holder of Option

 

Upon the death of the holder of an option granted under the Plan, such option
may be exercised (unless the option otherwise provides) for the following
specified number of shares by a legatee or legatees of such option under the
holder’s last will, or by the holder’s personal representatives or distributees,
at any time within one year after the holder’s death, but in no event after the
expiration of the term of the option: (i) if death occurs while the holder is
employed by the Company or a subsidiary, to the extent of (a) the shares
purchasable by such holder at the date of his death plus (b) the additional
shares covered by the next installment, if any, of such option, or (ii) if death
occurs within three months after the termination of the holder’s employment or
during any extension of the post-termination exercise period permitted by the
Committee pursuant to paragraph 10 hereof, to the extent of the shares
purchasable by such holder at the date of his death.

 

12. Employee’s Agreement to Serve

 

The recipient of any option exercisable by the optionee within twelve months of
the Granting Date shall agree to serve in the employ of the Company or, at the
election of the Company from time to time, one of its Subsidiaries, for such
period as the Committee shall determine, which shall not be less than twelve
months following the Granting Date. The Committee shall be authorized in its
discretion to grant options not exercisable by the optionee within twelve months
of the Granting Date, in which case the recipient of such option need not
(unless otherwise determined by the Committee) agree to serve in the employ of
the Company or its Subsidiaries.

 

13. Adjustments in Class B Common Stock

 

Notwithstanding any other provision of the Plan, each option may contain such
provisions as the Committee shall determine to be appropriate for the adjustment
of the number and class of shares subject to such option, the option

 

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price and the number of shares as to which the option shall be exercisable at
any time in the event of changes in the outstanding Class B Common Stock by
reason of any stock dividend, split-up, recapitalization, combination or
exchange of shares, merger, consolidation, separation, reorganization,
liquidation and the like. In the event of any such change in the outstanding
Class B Common Stock, the class and aggregate number of shares available under
the Plan shall be appropriately adjusted by the Committee, whose determination
shall be conclusive.

 

14. Amendment and Termination

 

Unless the Plan shall theretofore have been terminated as hereinafter provided,
the Plan shall terminate on, and no non-qualified option shall be granted
thereunder, after December 31, 2013, provided that the Board of Directors may at
any time prior to that date terminate the Plan. The Board of Directors shall
have complete power and authority to amend the Plan, provided, however, that the
Board of Directors shall not, without the affirmative vote of the holders of a
majority of the voting stock of the Company entitled to vote thereon, (i)
increase the maximum number of shares for which options may be granted under the
Plan, (ii) change the formula as to minimum option prices, (iii) extend the
period during which options may be granted or exercised or (iv) change the class
of employees to whom options may be granted. No termination or amendment of the
Plan may, without the consent of the individual to whom any option shall
theretofore have been granted, adversely affect the rights of such individual
under such option.

 

15. Government and Other Regulations

 

The obligation of the Company to sell and deliver shares under options granted
under the Plan shall be subject to all applicable laws, rules and regulations,
and to such approvals by any governmental agencies as may be required,
including, but not by way of limitation, the effectiveness of a Registration
Statement under the Securities Act of 1933, as amended, as deemed necessary or
appropriate by counsel for the Company.

 

16. Other Actions

 

Nothing contained in the Plan shall be construed to limit the authority of the
Company to exercise its corporate rights and powers, including, but not by way
of limitation, the right of the Company (i) to grant options for proper
corporate purposes otherwise than under the Plan to any

 

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employee or other person, firm, corporation or association or (ii) to grant
options to, or assume the option of, any person in connection with the
acquisition, by purchase, lease, merger, consolidation or otherwise, of the
business and assets (in whole or in part) of any person, firm, corporation or
association.

 

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