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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A

 

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

 

Check the appropriate box:

 

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under § 240.14a-12

 

Cable One, Inc.

(Name of Registrant as Specified in Its Charter)

 

 

(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)

 

 

Payment of Filing Fee (Check the appropriate box):

 

No fee required.

 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

 

(1)

 Title of each class of securities to which the transaction applies:

 

(2)

 Aggregate number of securities to which the transaction applies:

 

(3)

 Per unit price or other underlying value of the transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

(4)

 Proposed maximum aggregate value of the transaction:

 

(5)

 Total fee paid:

 

Fee paid previously with preliminary materials.

 

Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

       

 

(1)

 Amount Previously Paid:

 

(2)

 Form, Schedule or Registration Statement No.:

 

(3)

 Filing Party:

 

(4)

 Date Filed:

 

 

 

 

210 E. Earll Drive

Phoenix, AZ 85012

 

March 28, 2017

 

 

 

Dear Fellow Stockholders:

 

I am pleased to invite you to attend the 2017 Annual Meeting of Stockholders (the “Annual Meeting”) of Cable One, Inc. The Annual Meeting will be held at the Millenium Hilton, 55 Church Street, New York, New York, 10007, on Tuesday, May 2, 2017, at 8:30 a.m., local time.

 

Included with this letter are a Notice of Annual Meeting of Stockholders and Proxy Statement, which describe the business to be conducted at the Annual Meeting.

 

Your vote is important. Whether or not you plan to attend the Annual Meeting, we hope you will vote as soon as possible. You may vote over the Internet, as well as by telephone, or, if you requested to receive printed proxy materials, by returning a proxy card or voting instruction form in the envelope provided. If you plan to attend the Annual Meeting, kindly so indicate in the space provided on the proxy card or when prompted if voting over the Internet or by telephone.

 

 

Sincerely,

 

/s/ Thomas O. Might

 

Thomas O. Might

Executive Chairman and

Chairman of the Board

 

 

 

 

CABLE ONE, INC.

 

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

May 2, 2017

 

 

The 2017 Annual Meeting of Stockholders of Cable One, Inc. (the “Company”) will be held at the Millenium Hilton, 55 Church Street, New York, New York, 10007, on Tuesday, May 2, 2017, at 8:30 a.m., local time, for the following purposes:

 

 

1.

To elect two Class II directors to hold office until the 2020 annual meeting of stockholders and until their respective successors are elected and qualified, as more fully described in the accompanying Proxy Statement.

 

 

2.

To ratify the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm of the Company for the year ending December 31, 2017.

 

 

3.

To approve the compensation of our named executive officers for 2016 on an advisory basis.

 

 

4.

To select the frequency of future advisory votes on executive compensation on an advisory basis.

 

 

5.

To approve the Amended and Restated Cable One, Inc. 2015 Omnibus Incentive Compensation Plan.

 

 

6.

To transact such other business as may properly come before the meeting or any adjournment thereof.

 

The Board of Directors of the Company has fixed the close of business on March 10, 2017, as the record date for the determination of stockholders entitled to notice of and to vote at the meeting.

 

It is important that your shares be represented and voted at the meeting. Please sign and return your proxy card at your earliest convenience. You may also vote your shares by telephone or over the Internet. If you choose to vote your shares by telephone or over the Internet, please follow the instructions in the enclosed Proxy Statement and proxy card. You may revoke your proxy at any time before it has been voted at the meeting. You may vote in person at the meeting even if you have previously given your proxy. For shares held through a broker, bank or other nominee, you may vote submitting voting instructions as provided by your broker, bank or other nominee; however, you may not vote such shares in person at the meeting unless you have a proxy executed in your favor by your broker, bank or other nominee.

 

By Order of the Board of Directors,

 

/s/ Alan H. Silverman

 

Alan H. Silverman

Secretary

 

 

Phoenix, Arizona

March 28, 2017

 

 

 

 

TABLE OF CONTENTS

 

 

QUESTIONS AND ANSWERS

1

PROPOSAL 1: ELECTION OF DIRECTORS

5

CORPORATE GOVERNANCE

9

PROPOSAL 2: RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

15

EXECUTIVE COMPENSATION

17

PROPOSAL 3: ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION FOR 2016

40

PROPOSAL 4: ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATION

41

PROPOSAL 5: APPROVAL OF THE AMENDED AND RESTATED CABLE ONE, INC. 2015 OMNIBUS INCENTIVE COMPENSATION PLAN

42

DIRECTOR COMPENSATION

51

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

53

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

54

REPORT OF THE AUDIT COMMITTEE

55

CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS

56

STOCKHOLDER PROPOSALS FOR THE 2018 ANNUAL MEETING OF STOCKHOLDERS

59

HOUSEHOLDING OF PROXY MATERIALS

59

OTHER MATTERS THAT MAY COME BEFORE THE ANNUAL MEETING

60

ANNEX A: USE OF NON-GAAP FINANCIAL METRICS

A-1

ANNEX B: AMENDED AND RESTATED CABLE ONE, INC. 2015 OMNIBUS INCENTIVE COMPENSATION PLAN

B-1

 

 

 

 

 

 

CABLE ONE, INC.

210 E. Earll Dr.

Phoenix, Arizona 85012

 


  

PROXY STATEMENT

FOR THE 2017 ANNUAL MEETING OF STOCKHOLDERS

May 2, 2017

 


 

This Proxy Statement contains information relating to the 2017 Annual Meeting of Stockholders (the “Annual Meeting”) of Cable One, Inc. (the “Company, “we,” “us,” “our,” or “Cable ONE”) to be held at the Millenium Hilton, 55 Church Street, New York, New York, 10007, on Tuesday, May 2, 2017, at 8:30 a.m., local time, or any adjournments thereof, for the purposes set forth in the accompanying Notice of Annual Meeting of Stockholders. The Board of Directors (the “Board”) of the Company is making this proxy solicitation.

 

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders

to Be Held on May 2, 2017

 

Our Proxy Statement and Annual Report to Stockholders are available at

www.proxyvote.com

 

These proxy solicitation materials, including this Proxy Statement and the accompanying proxy card or voting instruction form, were first distributed and made available on or about March 28, 2017 to all stockholders entitled to vote at the Annual Meeting.

 

QUESTIONS AND ANSWERS

 

Q:

What am I voting on?

A:

There are five proposals scheduled to be voted on at the Annual Meeting:

 

 

The election of two Class II directors to hold office until the 2020 annual meeting of stockholders and until their respective successors are elected and qualified or as otherwise provided in our Amended and Restated By-laws (“By-laws”);

 

 

The ratification of the Audit Committee’s appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm of our Company for the year ending December 31, 2017;

 

 

The approval of the compensation of our named executive officers for 2016 on an advisory basis (also referred to as the “say-on-pay” vote);

 

 

The selection of the frequency of future advisory votes on executive compensation on an advisory basis (also referred to as the “say-on-frequency” vote); and

 

 

The approval of the Amended and Restated Cable One, Inc. 2015 Omnibus Incentive Compensation Plan (the “2015 Omnibus Plan”).

 

In the event that any nominee for election withdraws or for any reason is not able to serve as a director, Kevin P. Coyle and Alan H. Silverman, acting as your proxies, may vote for such other person as the Board may nominate.

 

1

 

 

Q:

What are the voting recommendations of the Board?

A:

The Board unanimously recommends you vote as follows:

 

 

 

Board Vote Recommendation

 

 

Page Reference

for Additional

Detail

 

Election of Directors

 

“FOR” each nominated director

   

5

 

Ratification of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2017

 

“FOR”

   

15

 

Advisory Vote on the Approval of Executive Compensation for 2016

 

“FOR”

   

40

 

Advisory Vote on the Frequency of Future Executive Compensation Advisory Votes

 

“1 YEAR”

   

41

 

Approval of the 2015 Omnibus Plan

 

“FOR”

   

42

 

 

The Board knows of no reason that would cause any director nominee to be unable to act or to refuse to accept his or her nomination or election.

 

Q:

Will any other matters be voted on?

A:

We are not aware of any matters to be voted on other than those referred to in this Proxy Statement. If any other matter is properly brought before the Annual Meeting, Kevin P. Coyle and Alan H. Silverman, acting as your proxies, will vote for you at their discretion.

 

Q:

How do I vote?

A:

If you are a stockholder of record (that is, if your shares are registered in your name and not in “street name”), there are four ways to vote:

 

 

 Over the Internet at www.proxyvote.com or scan the QR code on your proxy card with your mobile device. We encourage you to vote this way;

 

 

By toll-free telephone at 1-800-690-6903;

 

 

By completing and mailing your proxy card; or

 

 

By attending the Annual Meeting and voting in person.

 

If you hold shares in “street name” (that is, your shares are held in a brokerage account by a broker, bank or other nominee, also known as “beneficial owners”), you should follow the voting instructions provided by your broker, bank or other nominee.

 

If you wish to vote over the Internet or by telephone, your vote must be received by 11:59 p.m., Eastern Time, on the day before the Annual Meeting. After that time, Internet and telephone voting will not be permitted, and a stockholder of record wishing to vote who has not previously submitted a signed proxy card must vote in person at the Annual Meeting. Stockholders of record will be on a list held by the inspector of elections. Street name stockholders must obtain a proxy executed in their favor from the institution that holds their shares, whether it is their brokerage firm, bank or other nominee, and present it to the inspector of elections in order to vote at the Annual Meeting. Voting in person by a stockholder at the Annual Meeting will replace any previous votes submitted by proxy.

 

Your shares will be voted as you indicate. If you do not indicate your voting preferences, Kevin P. Coyle and Alan H. Silverman, acting as your proxies, will vote your shares in accordance with the Board’s recommendations specified above under “What are the voting recommendations of the Board?

 

Q:

Who can vote?

A:

You can vote if you were a stockholder as of the close of business on March 10, 2017 (the “Record Date”). Each of your shares—whether held (i) directly in your name as stockholder of record or (ii) in street name—entitles you to one vote with respect to each proposal to be voted on at the Annual Meeting. However, street name stockholders generally cannot vote their shares directly and instead must instruct the broker, bank or nominee how to vote their shares.

 

2

 

 

Q:

Can I change my vote?

A:

Yes. If you are a stockholder of record, you can change your vote or revoke your proxy at any time before the Annual Meeting:

 

 

By entering a new vote over the Internet or by telephone by 11:59 p.m., Eastern Time, on the day before the Annual Meeting;

 

 

By returning a properly signed proxy card with a later date that is received at or prior to the Annual Meeting; or

 

 

By voting in person at the Annual Meeting.

 

If you hold shares in street name, you may submit new voting instructions by contacting your bank, broker or other nominee. You may also change your vote or revoke your voting instructions in person at the Annual Meeting if you obtain a signed proxy from the record holder (bank, broker or other nominee) giving you the right to vote the shares. Only the latest validly executed proxy that you submit will be counted.

 

Q:

What vote is required to approve a proposal?

A:

Each proposal requires the affirmative vote of majority of the votes cast at the Annual Meeting in order to be approved. “Abstentions” and “broker non-votes” will not be counted as votes cast with respect to that proposal, although they will have the practical effect of reducing the number of affirmative votes required to achieve a majority by reducing the total number of shares from which the majority is calculated. Approval of Proposal 5 (approval of the 2015 Omnibus Plan) additionally requires that a majority of the outstanding shares on the Record Date actually cast votes on the matter. Abstentions and “broker non-votes” will have the practical effect of reducing the likelihood that this requirement will be satisfied.

 

Regarding Proposal 1 (election of the Company’s directors), in accordance with our By-laws, any incumbent director who fails to receive a majority of the votes cast must submit an offer to resign from the Board no later than two weeks after the Company certifies the voting results. In that case, the remaining members of the Board would consider the resignation offer and may either (i) accept the offer or (ii) reject the offer and seek to address the underlying cause(s) of the majority-withheld vote. The Board must decide whether to accept or reject the resignation offer within 90 days following the certification of the stockholder vote, and, once the Board makes its decision, the Company must promptly make a public announcement of the Board’s decision (including a statement regarding the reasons for its decision in the event the Board rejects the offer of resignation).

 

Q:

Who will count the vote?

A:

A representative of Broadridge Financial Solutions, Inc. will tabulate the votes and act as inspector of elections.

 

Q:

Who can attend the Annual Meeting?

A:

All stockholders of record as of the close of business on March 10, 2017, can attend. Street name stockholders must show proof of ownership in order to be admitted to the Annual Meeting.

 

Q:

What do I need to do to attend the Annual Meeting?

A:

In order to be admitted to the Annual Meeting, you must present proof of ownership of our common stock as of the Record Date. This can be a brokerage statement or letter from a broker, bank or other nominee indicating your ownership as of the Record Date, a proxy card, or a legal proxy or voting instruction card provided by your broker, bank or nominee. Any holder of a proxy from a stockholder must present the proxy card, properly executed, and a copy of the proof of ownership. Stockholders and proxyholders may also be asked to present a form of photo identification such as a driver’s license or passport.

 

In addition, please follow these instructions:

 

 

If you vote by using the enclosed proxy card, check the appropriate box on the card to indicate that you plan to attend the Annual Meeting.

 

 

If you vote over the Internet or by telephone, follow the instructions provided to indicate that you plan to attend the Annual Meeting.

 

3

 

 

Seating at the Annual Meeting will be on a first-come, first-served basis upon arrival at the Annual Meeting.

 

Backpacks, cameras, cell phones with cameras, recording equipment and other electronic recording devices will not be permitted inside the Annual Meeting. Failure to follow the Annual Meeting rules or permit inspection will be grounds for exclusion from the Annual Meeting.

 

Q:

Can I bring a guest?

A:

No. The Annual Meeting is for stockholders only.

 

Q:

What is the quorum requirement of the Annual Meeting?

A:

A majority of the votes entitled to be cast by the outstanding shares of common stock entitled to vote generally on the business properly brought before the Annual Meeting must be present in person or by proxy to constitute a quorum for the Annual Meeting. If you vote, your shares will be part of the quorum. Abstentions and “broker non-votes” will be counted for purposes of determining whether a quorum is present at the Annual Meeting. As of the Record Date, there were 5,724,508 shares of our common stock outstanding and entitled to vote.

 

If you hold your shares in street name and do not provide voting instructions to your broker, New York Stock Exchange (“NYSE”) rules grant your broker discretionary authority to vote your shares on “routine matters” at the Annual Meeting, including for the ratification of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2017 in Proposal 2. However, the proposals regarding the election of directors, the say-on-pay vote, the say-on-frequency vote and the approval of the 2015 Omnibus Plan are not considered “routine matters.” As a result, if you do not provide voting instructions to your broker, your shares will be voted on Proposal 2 but will not be voted on Proposals 1, 3, 4 and 5 (resulting in a “broker non-vote” with respect to each of Proposals 1, 3, 4 and 5). Although “broker non-votes” will be counted as present for purposes of determining a quorum, we urge you to promptly provide voting instructions to your broker or other nominee so that your shares are voted on all proposals.

  

Q:

Who is soliciting proxies?

A:

Solicitation of proxies is being made by the Company’s management through the mail, in person, over the Internet or by telephone, without any additional compensation being paid to such members of the Company’s management. The cost of such solicitation will be borne by the Company. In addition, the Company has requested brokers and other custodians, nominees and fiduciaries to forward proxy cards and proxy soliciting material to stockholders, and the Company will pay their fees and reimburse them for their expenses in so doing.

 

Q:

What other information about Cable ONE is available?

A:

The following information is available:

 

 

The Company maintains on its website, http://ir.cableone.net, copies of its Annual Report on Form 10-K; Annual Report to Stockholders; Corporate Governance Guidelines; Statement of Ethical Principles; Code of Business Conduct; charters of the Audit, Compensation, Executive, and Nominating and Governance Committees; Policy Statement Regarding Director Nominations and Stockholder Communications (the “Policy Statement”); and other information about the Company.

 

 

In addition, printed copies of these documents will be furnished without charge (except exhibits) to any stockholder upon written request addressed to the Secretary of the Company at 210 E. Earll Drive, Phoenix, Arizona 85012.

 

 

Amendments to, or waivers granted to the Company’s directors and executive officers under, the Code of Business Conduct, if any, will be posted on the Company’s website. 

 

Q:

Can I receive materials relating to the Annual Meeting electronically?

A:

To assist the Company in reducing costs related to the Annual Meeting, stockholders who vote over the Internet may consent to electronic delivery of mailings related to future annual stockholder meetings. The Company also makes its Proxy Statements and Annual Reports available online and may eliminate mailing hard copies of these documents to those stockholders who consent in advance to electronic distribution. If you are voting over the Internet, you may consent online at www.proxyvote.com when you vote. If you hold shares in street name, please also refer to information provided by the broker, bank or other nominee for instructions on how to consent to electronic distribution.

 

4

 

 

PROPOSAL 1: ELECTION OF DIRECTORS

 

The Board is divided into three classes, designated Class I, Class II and Class III. Directors are elected by class for three-year terms, which continue until the third annual meeting of stockholders following the director’s election and until the director’s successor is elected and qualified. Our Amended and Restated Certificate of Incorporation (“Charter”) and By-laws provide that the number of the directors of the Company will be fixed from time to time by the Board.

 

There are three Class II directors whose term of office expires in 2017. The nominees for election as Class II directors, to serve for a three-year term until the 2020 annual meeting of stockholders and until his successor is elected and qualified, are Alan G. Spoon and Wallace R. Weitz. All nominees are currently directors of the Company and were previously elected by the then-sole stockholder of the Company, Graham Holdings Company (“GHC”), at the effective time of the Company’s spin-off from GHC (the “spin-off”). Naomi M. Bergman will not stand for re-election at the conclusion of her term of office in 2017, and the size of the Board will be fixed at eight directors effective immediately upon the conclusion of Ms. Bergman’s term.

 

The candidates for election have been nominated by the Board based on the recommendation of the Nominating and Governance Committee. In choosing directors and nominees, the Company seeks individuals of the highest personal and professional ethics, integrity and business acumen, who are committed to representing the long-term interests of our stockholders. In respect of its composition, the Board considers the diversity, skills and experience of prospective nominees in the context of the needs of the Board and seeks directors who are “independent” under applicable law and listing standards. Although the Company’s Corporate Governance Guidelines and the Policy Statement do not prescribe specific standards regarding Board diversity, the Board considers, as a matter of practice, the diversity of prospective nominees (including incumbent directors), both culturally and in terms of the variety of viewpoints on the Board, which may be enhanced by a mix of different professional and personal backgrounds and experiences.

 

Directors are elected by the affirmative vote of majority of the votes cast at the Annual Meeting. The Board knows of no reason that would cause any nominee to be unable to act or to refuse to accept his or her nomination or election. In the event that any nominee withdraws or for any reason is not able to serve as a director, the individuals acting as your proxies may vote for such other person as the Board may nominate.

 

The following table presents certain information, as of March 10, 2017, concerning each nominee for election as a director and each director whose term of office will continue after the Annual Meeting.

 

Name

  

Age

  

Director

Since

  

Position

  

Expiration of

Term as Director

Mr. Thomas O. Might

  

65

  

1995

  

Executive Chairman, Chairman of the Board, and Director

  

2018

Ms. Julia M. Laulis

  

54

  

2017

  

President, Chief Executive Officer, and Director

  

2019

Mr. Brad D. Brian*

  

64

  

2016

  

Director

  

2019

Mr. Thomas S. Gayner*

  

55

  

2016

  

Lead Independent Director

  

2018

Ms. Deborah J. Kissire*

  

59

  

2016

  

Director

  

2018

Mr. Alan G. Spoon*

  

65

  

2016

  

Director

  

2017

Mr. Wallace R. Weitz*

  

67

  

2016

  

Director

  

2017

Ms. Katharine B. Weymouth*

  

50

  

2016

  

Director

  

2019

                        

   * Independent Director

 

In addition to the information presented below regarding each nominee’s specific qualifications, skills, attributes and experience that led the Board to conclude that he or she should serve as a director, the Board believes that each nominee has demonstrated established records of accomplishment in areas relevant to the Company’s strategy and operations and share characteristics identified in the Company’s Corporate Governance Guidelines, Statement of Ethical Principles and the Policy Statement as essential to a well-functioning deliberative body, including honesty, integrity, judgment, acumen, ethics, financial literacy, independence, competence, diligence and commitment to the interests of all stockholders to build long-term stockholder value.

 

All of the directors and nominees have held senior positions as leaders of complex organizations and gained expertise in core management skills, such as strategy and business development, innovation, line operations, brand management, finance, compensation and leadership development, compliance and risk management. They have significant experience in corporate governance and oversight through their positions as senior executives and as directors of public companies and other institutions. These skills and experience are pertinent to the Company’s current and evolving business strategies, as well as to the Board’s oversight role, and enable the directors to provide diverse perspectives about the complex issues facing the Company.

 

5

 

 

The following matrix and biographies highlight specific qualifications, skills, attributes and experience of each of our directors who is a nominee for election as a director or whose term of office will continue after the Annual Meeting. The matrix is a summary only; therefore, it does not include all of the qualifications, skills, attributes and experience that each director offers, and the fact that a particular qualification, skill, attribute or experience is not listed does not mean that a director does not possess it.

 

  

  

Cable /

Communications /

Media Industry

Experience

  

Leadership

Experience

  

Governance /

Board

Experience

  

Financial /

Accounting

Expertise

  

Legal

Expertise

  

Diversity

Brad D. Brian

  

  

  

  

  

  

  

  

  

  

Thomas S. Gayner

  

  

  

  

  

  

  

  

Deborah J. Kissire

  

  

  

  

  

  

  

  

Thomas O. Might

  

  

  

  

  

  

  

  

  

Julia M. Laulis

  

  

  

 

  

  

  

  

  

Alan G. Spoon

  

  

  

  

  

  

  

  

Wallace R. Weitz

  

  

  

  

  

  

  

  

  

Katharine B. Weymouth

  

  

  

  

  

  

  

 

Nominees for Election for a Term Expiring at the 2020 Annual Meeting of Stockholders

 

Alan G. Spoon

 

Mr. Spoon is currently Partner Emeritus at Polaris Partners, a private investment firm that provides venture capital to development-stage companies. He has been with Polaris Partners since May 2000, previously serving as Managing General Partner and General Partner. Mr. Spoon was Chief Operating Officer and a director of The Washington Post Company from March 1991 through May 2000 and served as President of The Washington Post Company from September 1993 through May 2000. Prior to that, he held a wide variety of positions at The Washington Post Company, including President of Newsweek from September 1989 to May 1991. Mr. Spoon began his career at, and later became a partner of, The Boston Consulting Group.

 

Mr. Spoon serves on the boards of Danaher Corporation, Fortive Corporation, IAC/InterActiveCorp and Match Group, Inc. and previously served as a director of Cable ONE from 1991 to 2000. Additionally, he has served on the boards of Getty Images, TechTarget, Inc., Human Genome Sciences, Ticketmaster and American Management Systems. Previously, Mr. Spoon was a member of the Board of Regents at the Smithsonian Institution (formerly Vice Chairman). He is a member of the MIT Corporation (member of the Executive Committee), where he also serves on the board of edX (an online education platform).

 

Mr. Spoon’s public company leadership experience gives him insight into business strategy, leadership and executive compensation, and his public company and private equity experience give him insight into technology trends, acquisition strategy and financing. With more than 20 years of experience with The Washington Post Company, including nine years as a director of Cable ONE, he also has knowledge of Cable ONE’s business.

 

Wallace R. Weitz

 

Mr. Weitz founded the investment management firm Weitz Investment Management, Inc. in 1983 as Wallace R. Weitz & Company and has since served in various roles at Weitz Investment Management, including Chief Investment Officer, President and Portfolio Manager. Mr. Weitz manages the Partners III Opportunity Fund and co-manages the Partners Value Fund and Hickory Fund, each of which is managed by Weitz Investment Management. Mr. Weitz has served as a Trustee of the Weitz Funds since 1986. Mr. Weitz began his career in New York as a securities analyst before joining Chiles, Heider & Co. in Omaha, Nebraska in 1973. There, he spent 10 years as an analyst and portfolio manager. Mr. Weitz is on the Board of Trustees for Carleton College and serves on various other non-profit boards.

 

Mr. Weitz brings to the Board his substantial finance experience as an investor in public companies.

 

6

 

 

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE NOMINATED DIRECTORS.

 

Directors Continuing in Office

 

Brad D. Brian

 

Mr. Brian is a Co-Managing Partner at the California law firm Munger, Tolles & Olson LLP, having been with the firm for over 30 years. A complex civil and criminal litigator, Mr. Brian is a Fellow in the American College of Trial Lawyers and the International Academy of Trial Lawyers. Mr. Brian has represented numerous Fortune 500 corporations in lawsuits and government investigations. This work has included trials, regulatory investigations and internal corporate investigations. He also has defended companies against more than 40 lawsuits filed under the qui tam provisions of the False Claims Act. Mr. Brian is the co-editor of Internal Corporate Investigations (ABA 3rd Ed. 2007). Mr. Brian was named a “Litigator of the Year” by The American Lawyer in 2016.

 

Mr. Brian brings to the Board his experience as a litigator and understanding of legal matters that may arise at Cable ONE.

 

Thomas S. Gayner

 

Mr. Gayner has served as Co-Chief Executive Officer of Markel Corporation, a publicly traded financial holding company headquartered in Glen Allen, Virginia, since January 2016 and as a director since August 2016. He also served as President and Chief Investment Officer of Markel Corporation from May 2010 until December 2015, and as a director of Markel Corporation from 1998 to 2003. Since 1990, he has served as President of Markel-Gayner Asset Management Corporation. Previously, he was a certified public accountant at PricewaterhouseCoopers LLP and a Vice President of Davenport & Company LLC in Virginia. Mr. Gayner serves on the boards of GHC, Colfax Corporation and The Davis Series Mutual Funds. He also serves on the boards of the non-profit entities Bon Secours Health System and the Community Foundation of Richmond.

 

Mr. Gayner brings to the Board the leadership, management oversight and financial skills gained in his role as a senior manager and director of Markel Corporation as well as other public company boards.

 

Deborah J. Kissire

 

Ms. Kissire retired as a partner of Ernst & Young LLP, an independent registered public accounting firm, in July 2015 after a 36-year career. At the time of her retirement, Ms. Kissire served as Ernst & Young’s Vice Chair and East Central Managing Partner as well as a member of the Americas Executive Board. Ms. Kissire serves on the boards of Axalta Coating Systems Ltd. and Omnicom Group Inc., and she has served on the boards of Goodwill Industries of Greater Washington and Junior Achievement USA.

 

Ms. Kissire brings to the Board her significant experience in public company financial reporting, accounting and financial control matters.

 

Julia M. Laulis

 

Ms. Laulis has been Chief Executive Officer and a member of the Board since January 2017 and President of Cable ONE since January 2015.

 

Ms. Laulis joined Cable ONE in 1999 as Director of Marketing-NW Division. In 2001, she was named Vice President of Operations for the SW Division. In 2004, she accepted the additional responsibility for starting up Cable ONE’s Phoenix Customer Care Center. In 2008, she was named Chief Operations Officer, and in 2012, she was named Chief Operating Officer of Cable ONE. In January 2015, she was promoted to President and Chief Operating Officer of Cable ONE.

 

Prior to joining Cable ONE, Ms. Laulis served in various senior marketing positions with Jones Communications. Ms. Laulis began her 30-plus-year career in the cable industry with Hauser Communications.

 

Ms. Laulis brings to the Board her significant operational and leadership experience as well as intimate knowledge and perspective about the strategic and operational opportunities and challenges, economic and industry trends, and competitive and financial positioning of the Company based on her various executive roles at Cable ONE.

 

7

 

 

Thomas O. Might

 

Mr. Might has been Executive Chairman of Cable ONE since January 2017. He has served as Chairman of the Board of Cable ONE since 2015 and as a member of the Board of Cable ONE since 1995. Mr. Might served as Chief Executive Officer of Cable ONE from 1994 to 2016 and as President of Cable ONE from 1994 to 2014.

 

Mr. Might joined The Washington Post Company in 1978 as assistant to publisher Donald E. Graham after serving a summer internship at the newspaper in 1977. He was promoted to Vice President-Production in 1982 and served in that position until 1987, when he became Vice President-Production and Marketing. In 1991, Mr. Might was named Vice President-Advertising Sales.

 

In 1993, Mr. Might was promoted to President and Chief Operating Officer of Cable ONE (formerly named Post-Newsweek Cable). He became President and Chief Executive Officer of Cable ONE in 1994 and was elected to the Board in 1995.

 

Mr. Might serves on the boards of the American Cable Association, CableLabs, and C-SPAN. Mr. Might was a Combat Engineer Officer in the U.S. Army from 1972 to 1976.

 

Mr. Might brings to the Board leadership and management oversight skills as well as intimate knowledge and perspective about the strategic and operational opportunities and challenges, economic and industry trends, and competitive and financial positioning of the Company based on his various executive roles at Cable ONE.

 

Katharine B. Weymouth

 

Ms. Weymouth was the Chief Executive Officer of Washington Post Media and Publisher of The Washington Post newspaper from February 2008 until October 2014. She joined The Washington Post Company in 1996 as Assistant General Counsel of The Washington Post newspaper and held various positions within that organization over the course of 18 years. Ms. Weymouth held several positions within The Washington Post’s advertising department, including Director of the department’s jobs unit, Director of Advertising Sales and Vice President of Advertising. She also served as Associate Counsel of Washingtonpost.Newsweek Interactive, then the online publishing subsidiary of The Washington Post Company. Ms. Weymouth has been a director of GHC, from which Cable ONE was spun-off in July 2015, since September 2010. She serves as a Trustee of the Philip L. Graham Fund and of The Field School and is a director of the American Institute of Architects, The Economic Club of Washington, D.C. and the Community Foundation for the Greater Capital Region.

 

Ms. Weymouth brings to the Board public company leadership, management oversight and operational expertise gained through her various senior roles with and directorship of GHC.

 

There are no family relationships among any of our directors and executive officers.

 

8

 

 

CORPORATE GOVERNANCE

 

Board Committees and Meeting Attendance

 

The standing committees of the Board include the Audit Committee, Compensation Committee, Executive Committee, and Nominating and Governance Committee. As discussed in more detail below, each of the Audit, Compensation and Nominating and Governance Committees is comprised entirely of independent directors, consistent with the definition of “independent” under NYSE listing standards applicable to boards of directors generally and board committees in particular.

 

Each committee of the Board operates under a written charter that is maintained on our website, http://ir.cableone.net/govdocs, and has the authority to hire at the expense of the Company independent legal, accounting, financial or other advisors as it deems necessary or appropriate.

 

The following table summarizes the current membership of the Board and each of its committees, as well as the number of times the Board and each committee met during 2016.

 

Director

  

Board

  

Audit

Committee

  

Compensation Committee

  

Executive Committee

  

Nominating

and

Governance Committee

Thomas O. Might

  

Chair

  

  

  

  

  

  

  

Julia M. Laulis*

  

  

  

  

  

  

  

  

Naomi M. Bergman**

  

  

  

  

  

  

  

Brad D. Brian

  

  

  

  

  

  

  

Thomas S. Gayner

  

Lead Independent Director

  

  

  

  

  

Chair

  

Chair

Deborah J. Kissire

  

  

Chair

  

  

  

  

  

  

Alan G. Spoon

  

  

  

  

  

  

Wallace R. Weitz

  

  

  

  

Chair

  

  

  

  

Katharine B. Weymouth

  

  

  

  

  

  

  

  

  

Number of Meetings

  

7

  

5

  

6

  

4

  

5

*

As of January 1, 2017, the Board elected Ms. Laulis as a director and a member of the Executive Committee.

**

Ms. Bergman will not stand for re-election at the conclusion of her term of office in 2017. Effective immediately upon the conclusion of Ms. Bergman’s term, it is anticipated that Ms. Weymouth will be appointed to the Audit Committee and Mr. Weitz will be appointed to the Nominating and Governance Committee.

 

Each director attended at least 75% of the meetings of the Board and the committees of the Board on which the director served in 2016.

 

Audit Committee

 

The functions of the Audit Committee include, among other duties, overseeing:

 

 

management’s conduct of our financial reporting process (including the development and maintenance of systems of internal accounting and financial controls);

 

 

the integrity of our financial statements;

 

 

our compliance with legal and regulatory requirements;

 

 

the qualifications and independence of our outside auditor;

 

 

the performance of our internal audit function;

 

 

the outside auditor’s annual audit of our financial statements; and

 

 

the preparation of certain reports required by the rules and regulations of the Securities and Exchange Commission (the “SEC”).

 

9

 

 

The Board has determined that all members of the Audit Committee are non-employee, “financially literate,” “independent” directors within the meaning of the listing standards of the NYSE. None of the members of the Audit Committee has accepted, other than in such person’s capacity as a committee or Board member, any consulting, advisory or other compensatory fee from the Company or its affiliates.

 

The Board has determined that each of Ms. Kissire and Mr. Spoon has the requisite background and experience to be (and is) designated an “audit committee financial expert” within the meaning of Item 407(d)(5)(ii) of Regulation S-K due to his or her extensive experience, as discussed under “Proposal 1: Election of Directors.” In addition, the Board has determined that all of the members of the Audit Committee are well grounded in financial matters and are familiar with generally accepted accounting principles. All of the members of the Audit Committee have a general understanding of internal controls and procedures for financial reporting, as well as an understanding of audit committee functions. To the extent that matters come before the Audit Committee that involve accounting issues, the members of the Audit Committee consult with and rely on management, in addition to consulting with external experts, such as the Company’s independent registered public accounting firm, PricewaterhouseCoopers LLP. In addition, the Audit Committee has authority to obtain advice from internal or external legal or other advisors.

 

Compensation Committee

 

The functions of the Compensation Committee include, among other duties:

 

 

determining and approving the compensation of our Chief Executive Officer;

 

 

reviewing and approving the compensation of other members of our senior management;

 

 

overseeing the administration and determination of awards under our compensation plans; and

 

 

preparing any report on executive compensation required by the rules and regulations of the SEC.

 

All members of the Compensation Committee are non-employee directors and have been determined to be “independent” within the meaning of the listing standards of the NYSE applicable to service on compensation committees of emerging growth companies.

 

Executive Committee

 

The functions of the Executive Committee include, among other duties:

 

 

reviewing and providing guidance to the Board and to senior management of the Company regarding the Company’s strategy, operating plans and operating performance; and

 

 

performing such other duties or responsibilities as may be delegated to the Committee from time to time by the Board.

 

Nominating and Governance Committee

 

The functions of the Nominating and Governance Committee include, among other duties:

 

 

overseeing our corporate governance practices;

 

 

reviewing and recommending to our Board amendments to our By-laws, Charter, committee charters and other governance policies;

 

 

reviewing and making recommendations to our Board regarding the structure of our various board committees;

 

 

identifying, reviewing and recommending to our Board individuals for election to the Board;

 

10

 

 

 

adopting and reviewing policies regarding the consideration of candidates for our Board proposed by stockholders and other criteria for membership on our Board;

 

 

overseeing the Chief Executive Officer succession planning process, including an emergency succession plan;

 

 

reviewing the leadership structure for our Board;

 

 

overseeing our Board’s annual self-evaluation; and

 

 

overseeing and monitoring general governance matters, including communications with stockholders and regulatory developments relating to corporate governance.

 

All members of the Nominating and Governance Committee are non-employee directors and have been determined to be “independent” within the meaning of the listing standards of the NYSE.

 

Corporate Governance Guidelines and Codes of Conduct

 

In order to help assure the highest levels of business ethics at Cable ONE, our Board has adopted the following Corporate Governance Guidelines and codes of conduct, which are maintained on our website, http://ir.cableone.net/govdocs.

 

Corporate Governance Guidelines

 

Our Corporate Governance Guidelines provide a framework for the governance of the Company. Among other things, our Corporate Governance Guidelines address director qualifications, Board operations, director compensation, management review and succession, and director orientation and continuing education. The Corporate Governance Guidelines also provide for annual self-evaluations by the Board and its committees.

 

The Board has not established limits on the number of terms a director may serve prior to his or her 75th birthday; however, no director may be nominated to a new term if he or she would be age 75 or older at the time of the election.

 

Code of Business Conduct

 

Our Code of Business Conduct applies to our employees, including any employee directors. The Code of Business Conduct contains policies pertaining to, among other things, employee conduct in the workplace; electronic communications and information security; accuracy of books, records and financial statements; securities trading; confidentiality; conflicts of interest; fairness in business practices; anti-bribery and anti-corruption laws; antitrust laws; and political activities and solicitations.

 

Statement of Ethical Principles 

 

Our Statement of Ethical Principles applies to our directors, officers and employees and is designed to deter wrongdoing and to promote, among other things:

 

 

honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

 

 

the protection of the confidentiality of our non-public information;

 

 

the responsible use of and control over our assets and resources;

 

 

full, fair, accurate, timely and understandable disclosure in reports and documents that we file with the SEC and other regulators and in our other public communications;

 

 

compliance with applicable laws, rules and regulations; and

 

 

accountability for adherence to the Statement of Ethical Principles and prompt internal reporting of any possible violation of the Statement of Ethical Principles.

 

11

 

 

Director Nomination Process

 

Under our By-laws, stockholders of record are able to nominate persons for election to our Board only by providing proper notice to our Secretary. Proper notice must be timely, generally between 90 and 120 days prior to the relevant meeting (or, in the case of annual meetings, prior to the first anniversary of the prior year’s annual meeting), and must include, among other information, the name and address of the stockholder giving the notice, a representation that such stockholder is a holder of record of our common stock as of the date of the notice, certain information regarding such stockholder’s beneficial ownership of our securities and any derivative instruments based on or linked to the value of or return on our securities as of the date of the notice, certain information relating to each person whom such stockholder proposes to nominate for election as a director, a brief description of any other business such stockholder proposes to bring before the meeting and the reason for conducting such business and a representation as to whether such stockholder intends to solicit proxies.

 

The Nominating and Governance Committee will consider director candidates recommended by stockholders. Our By-laws provide that any stockholder of record entitled to vote for the election of directors at the applicable meeting of stockholders may nominate persons for election to our Board, if such stockholder complies with the applicable notice procedures.

 

Our Corporate Governance Guidelines and the Policy Statement contain information concerning the responsibilities of the Nominating and Governance Committee with respect to identifying and evaluating future director candidates. The Policy Statement sets forth our Nominating and Governance Committee’s general policy regarding the consideration of candidates proposed by stockholders; a description of the minimum criteria used by the Nominating and Governance Committee in evaluating candidates for the Board; a description of the Nominating and Governance Committee’s process for identifying and evaluating director nominees (including candidates recommended by stockholders); and the general process for communications between stockholders and the Board.

 

Majority Voting for Directors

 

Our By-laws provide for majority voting in uncontested director elections, and any incumbent director who fails to receive a majority of the votes cast must submit an offer to resign from the Board no later than two weeks after the Company certifies the voting results. In that case, the remaining members of the Board would consider the resignation offer and may either (i) accept the offer or (ii) reject the offer and seek to address the underlying cause(s) of the majority-withheld vote. The Board must decide whether to accept or reject the resignation offer within 90 days following the certification of the stockholder vote, and, once the Board makes its decision, the Company must promptly make a public announcement of the Board’s decision (including a statement regarding the reasons for its decision in the event the Board rejects the offer of resignation).

 

Director Independence

 

As set forth in our Corporate Governance Guidelines, the majority of directors must be “independent” according to the criteria for independence established by the NYSE. Our Corporate Governance Guidelines also require that all the members of each of the standing committees (other than the Executive Committee) must be independent and may not directly or indirectly accept any consulting, advisory or other compensatory fee (other than pension or other forms of deferred compensation for prior service which is not contingent in any way on continued service) from the Company or its subsidiaries and none of the members of the standing committees may have a material relationship with the Company. In order to determine that a director is independent, the Board must make an affirmative determination that the director satisfies applicable regulatory and NYSE listing requirements to be an independent director of the Company and that the director is free of any other relationship that would interfere with the exercise of independent judgment by such director. The Board has determined that the following directors are independent Naomi M. Bergman, Brad D. Brian, Thomas S. Gayner, Deborah J. Kissire, Alan G. Spoon, Wallace R. Weitz and Katharine B. Weymouth.

 

Executive Sessions of the Non-Management Directors

 

The listing standards of the NYSE call for the non-management directors of the Company to meet at regularly scheduled executive sessions without management. Thomas S. Gayner serves as Lead Independent Director of the Board, and he presides at the executive sessions of the Board. In 2016, the non-management directors regularly met in executive sessions outside the presence of any employee director or management, and the non-management directors expect to meet in executive session in 2017 as appropriate.

 

12

 

 

Board Leadership Structure

 

The Board supports flexibility in determining its leadership structure by not requiring the separation of the roles of Chairman of the Board and Chief Executive Officer. The Board believes that the Company and its stockholders are best served by maintaining this flexibility rather than mandating a particular leadership structure.

 

In 2016, Mr. Might served as Chairman of the Board as well as Chief Executive Officer of the Company. Effective January 1, 2017, Ms. Laulis was appointed President and Chief Executive Officer, while Mr. Might continues to serve as Chairman of the Board. Until the separation of the roles in 2017, the Board believed that Mr. Might’s service as both Chairman of the Board and Chief Executive Officer was in the best interests of the Company and that this structure was appropriate because Mr. Might possesses in-depth strategic and operational knowledge of the opportunities and challenges facing the Company and has played a critical role in the growth of the Company during his over-20 years of experience as an executive at and as a member of the Board of Cable ONE.

 

We currently maintain separate roles between Chairman of the Board and Chief Executive Officer in recognition of the differences between the two responsibilities and because we believe that, at this time, the separation of the roles is in the best interests of the Company. This structure is appropriate because our Chief Executive Officer, Ms. Laulis, is responsible for, among other things, setting our strategic direction and day-to-day leadership and performance of our Company. Meanwhile, Mr. Might continues to serve as an executive officer of the Company. As Chairman of the Board and Executive Chairman, Mr. Might focuses on strategy and business development, provides input to the Chief Executive Officer, develops agendas that focus on matters that merit Board attention, and presides over meetings of the full Board.

 

To ensure the Board’s independence and proper functioning, the Board also appoints a Lead Independent Director. Thomas S. Gayner currently serves in this capacity. The Lead Independent Director typically chairs executive sessions of Board meetings and consults with Mr. Might, Ms. Laulis and senior management regarding issues to be included in Board meeting agendas. The Lead Independent Director is also expected to collaborate with Mr. Might and Ms. Laulis, along with the other members of the Executive Committee, in reviewing key operational and other matters and to act as a liaison between Mr. Might and Ms. Laulis and the non-management directors. The role of the Lead Independent Director is able to provide strong leadership of the non-management directors and help the Board provide effective independent oversight of the Chairman of the Board and Executive Chairman as well as the Chief Executive Officer.

 

Board’s Role in Risk Oversight

 

The Board as a whole actively considers strategic decisions proposed by management, including matters affecting the business strategy and competitive and financial positions of the Company, and monitors the Company’s risk profile. Board meetings are focused on strategic matters affecting major areas of the Company’s business, including operational, execution and competitive risks and risk management initiatives. The Board fulfills certain risk oversight functions through its standing committees. For example, the Audit Committee plays a key role in risk oversight, particularly with respect to financial reporting, accounting and compliance matters; the Compensation Committee addresses the risk profile of the Company’s compensation program and arrangements; and the Nominating and Governance Committee oversees corporate governance-related risk associated with our governance practices and profile.

 

Risk oversight activities are supported by internal reporting structures that aim to surface directly to the Board key matters that can affect the Company’s risk exposures. The Company has established a Disclosure Controls Committee that reports directly to the Audit Committee on certain matters relating to the Company’s public disclosures.

 

Communicating with Directors

 

In accordance with the Policy Statement, stockholders and other interested persons seeking to communicate with the Board may submit any communications in writing to the Company’s Secretary, at the address of the Company’s headquarters: 210 E. Earll Drive, Phoenix, Arizona 85012. Any such communication must state the number of shares beneficially owned by the stockholder making the communication. The Secretary will review all incoming stockholder communications, except for solicitations, junk mail and obviously frivolous or inappropriate communications, and forward such communications, as appropriate, to the full Board or to any individual director or directors to whom the communication is directed.

 

13

 

 

Annual Meeting Attendance

 

The Board does not have a policy of requiring directors to attend annual meetings of stockholders; however, the Company generally schedules a Board meeting in conjunction with its annual meeting of stockholders and encourages directors and nominees for director to attend each annual meeting of stockholders. All of our directors attended our 2016 annual meeting of stockholders.

 

Compensation Committee Interlocks and Insider Participation

 

Messrs. Brian, Spoon and Weitz served as members of the Compensation Committee in 2016. None of these individuals has ever been an employee of the Company. During 2016, none of our executive officers served on the board of directors or compensation committee of any other entity for which a member of our Board or Compensation Committee served as an executive officer.

 

Corporate Governance Policies Related to Compensation and Equity

 

Please refer to Compensation Discussion and Analysis—Corporate Governance Policies” beginning on page 27 of this Proxy Statement for discussion of our stock ownership guidelines, and our policies with respect to prohibiting derivative trading, hedging and pledging; clawbacks; and the tax deductibility of compensation. 

 

14

 

 

PROPOSAL 2: RATIFICATION OF APPOINTMENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

The firm of PricewaterhouseCoopers LLP, an independent registered public accounting firm, has audited the financial statements of our Company for the fiscal year ended December 31, 2016. Our Audit Committee has appointed PricewaterhouseCoopers LLP to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2017 and recommends that stockholders vote in favor of the ratification of such appointment. Although ratification is not required by our By-laws or otherwise, the Board is submitting the selection of PricewaterhouseCoopers LLP to our stockholders for ratification as a matter of good corporate governance. If the appointment is not ratified, the Audit Committee will consider whether it is appropriate to select another independent registered public accounting firm. Even if the appointment is ratified, the Audit Committee, in its discretion, may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and our stockholders.

 

We anticipate that representatives of PricewaterhouseCoopers LLP will be present at the Annual Meeting, will have the opportunity to make a statement if they desire to do so with respect to our financial statements for the fiscal year ended December 31, 2016 and the firm’s relationship with the Company and will be available to respond to appropriate questions from stockholders.

 

Audit Committee Pre-Approval Policies and Procedures

 

The Audit Committee’s charter provides that the duties and responsibilities of the Audit Committee include the pre-approval of audit and non-audit services performed by the independent registered public accounting firm in order to assure that the provision of such services does not impair our auditor’s independence. Any proposed services exceeding pre-approved cost levels will require specific pre-approval by the Audit Committee. The term of any pre-approval is 12 months from the date of pre-approval, unless the Audit Committee specifically provides for a different period. The Audit Committee will periodically review and pre-approve the services that may be provided by the independent registered public accounting firm as well as revise the list of pre-approved services from time to time, based on subsequent determinations.

 

The Audit Committee will not delegate to management responsibilities to pre-approve services performed by the independent registered public accounting firm. The Audit Committee may delegate pre-approval authority to one or more of its members. The annual audit services engagement terms and fees will be subject to the specific pre-approval of the Audit Committee. The Audit Committee will approve, if necessary, any changes in terms, conditions and fees resulting from changes in audit scope, Company structure or other matters. In addition to the annual audit services engagement specifically approved by the Audit Committee, the Audit Committee may grant pre-approval for other audit services, which are those services that only the independent auditor reasonably can provide. The Audit Committee will not approve any non-audit services prohibited by applicable SEC regulations or any services in connection with a transaction initially recommended by the independent registered public accounting firm, the purpose of which may be tax avoidance and the tax treatment of which may not be supported by the Internal Revenue Code of 1986, as amended (the “Code”), and related regulations.

 

Audit-related services are assurance and other services that are reasonably related to the performance of the audit or review of the Company’s financial statements or that are traditionally performed by the independent registered public accounting firm. The Audit Committee believes that the provision of audit-related services does not impair the independence of the independent registered public accounting firm.

 

The Audit Committee believes that the independent registered public accounting firm can provide tax services to the Company, such as tax compliance, tax planning and tax advice, without impairing such auditor’s independence. However, the Audit Committee will not permit the retention of the independent registered public accounting firm in connection with a transaction initially recommended by the independent auditor, the purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Code and related regulations.

 

The Audit Committee may grant pre-approval of those permissible non-audit services classified as “All Other” services that it believes are routine and recurring services and would not impair the independence of the auditor.

 

Requests or applications to provide services that require specific approval by the Audit Committee will be submitted to the Audit Committee by the Chief Financial Officer (or other designated officer) and must include a statement from that individual as to whether, in his or her view, the request or application is consistent with the SEC’s rules on auditor independence.

 

15

 

 

Audit and Other Fees

 

The following table provides information regarding the aggregate fees billed to the Company for professional services rendered by PricewaterhouseCoopers LLP for 2016 and 2015.

 

   

2016

   

2015

 

Audit Fees (1)

  $ 1,858,000     $ 1,064,129  

Audit-Related Fees (2)

    681,068       35,000  

Tax Fees (3)

    36,504       40,000  

All Other Fees (4)

    1,800       1,800  

Total

  $ 2,577,372     $ 1,140,929  

 

                              

 

(1)

Audit fees for 2016 and 2015 related to the annual audit and reviews of financial statements included in the Company’s quarterly filings, including reimbursable expenses. Audit fees for 2016 also related to the initial annual audit of our internal control over financial reporting. Audit fees for 2015 also related to the filing of a Form S-8 for shares issuable in connection with the Cable One, Inc. 2015 Omnibus Incentive Compensation Plan (the “Existing 2015 Plan”).

 

 

(2)

Audit-related fees for 2016 and 2015 related to assurance and other services reasonably related to the performance of the audit or reviews of financial statements and not included under “Audit Fees” above, including reimbursable expenses. Audit-related fees for 2016 also related to due diligence services related to mergers and acquisitions.

 

 

(3)

Tax fees for 2016 and 2015 related to tax compliance, tax advice and tax planning, including reimbursable expenses. These fees were primarily for state and local tax consulting.

     
  (4) All other fees for 2016 and 2015 related to software licensing for a finance and accounting research tool provided by PricewaterhouseCoopers LLP.

 

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM OF OUR COMPANY FOR THE FISCAL YEAR ENDING DECEMBER 31, 2017.

 

16

 

 

EXECUTIVE COMPENSATION

 

Compensation Discussion and Analysis

 

Executive Summary

 

Named Executive Officers (“NEOs”)

 

This Compensation Discussion and Analysis describes the compensation of our NEOs named in the 2016 Summary Compensation Table:

 

Name

 

Position

Thomas O. Might*

 

Chairman of the Board and Chief Executive Officer (“CEO”) (through 12/31/16)

Julia M. Laulis*

 

President and Chief Operating Officer (through 12/31/16)

Kevin P. Coyle

 

Senior Vice President and Chief Financial Officer

Stephen A. Fox

 

Senior Vice President and Chief Network Officer

Alan H. Silverman

 

Senior Vice President, General Counsel and Secretary

                  

*

As of January 1, 2017, Mr. Might was appointed Executive Chairman and Ms. Laulis was appointed President and CEO. All references to our CEO throughout the Compensation Discussion and Analysis and in the Executive Compensation section of this Proxy Statement refer to Mr. Might, unless the context indicates otherwise.

 

2016 Highlights

 

Below are highlights of our financial performance in 2016, including Adjusted EBITDA, which was the performance metric used for the Company’s 2016 Annual Executive Bonus Plan (the “2016 Bonus Plan”) and the annual grant of performance-based restricted stock awards (“PSAs”) in 2016:

 

 

Net income was $98.9 million in 2016, an increase of 11.1% compared to net income of $89.0 million in 2015.

 

 

Adjusted EBITDA was $350.5 million, an increase of 10.3% compared to Adjusted EBITDA of $317.7 million in 2015. See Annex A of this Proxy Statement, entitled “Use of Non-GAAP Financial Metrics,” for the definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, which is the most directly comparable measure under U.S. generally accepted accounting principles (“GAAP”).

 

 

Net cash provided by operating activities was $251.8 million, an increase of 2.2% compared to net cash provided by operating activities of $246.4 million in 2015.

 

 

Adjusted EBITDA less capital expenditures was $225.0 million, an increase of 48.7% compared to Adjusted EBITDA less capital expenditures of $151.4 million in 2015. See Annex A of this Proxy Statement, entitled “Use of Non-GAAP Financial Metrics,” for the definition of Adjusted EBITDA less capital expenditures and reconciliations to net income, which is the most directly comparable measure under GAAP when this metric is used as a performance measure, and to net cash provided by operating activities, which is the most directly comparable measure under GAAP when this metric is used as a liquidity measure.

 

Noteworthy Changes to our Compensation Program for 2017

 

 

Redesigned performance-based equity awards for 2017. The PSAs for 2017 are based on three-year cumulative Adjusted EBITDA less capital expenditures, which as compared to the PSAs for 2016, will extend the performance period from one year to three years and will differentiate the performance metrics between our annual executive bonus plan and our long-term equity incentive awards. For additional details, please see “2017 Compensation Actions” below.

 

17

 

 

 

Management changes. Effective as of January 1, 2017, Mr. Might was appointed Executive Chairman and Ms. Laulis was appointed President and CEO. In connection with Mr. Might’s appointment, his annual base salary was reduced, he is not eligible to receive an annual bonus under our annual executive bonus plan for 2017, and he received a grant of PSAs. In connection with Ms. Laulis’ appointment, her annual base salary and target annual bonus were increased, and she received a one-time promotional stock appreciation right (“SAR”) grant in addition to her annual PSA grant. For additional details regarding the new compensation terms for Mr. Might and Ms. Laulis, please see “Elements of our Compensation Program” below.

 

 

Amended stock ownership guidelines in 2017. In 2017, the Board amended our stock ownership guidelines, which, among other things, increased the required stock ownership level for our CEO from a multiple of five times base salary to six times base salary and adopted the same six times base salary multiple for the newly created position of Executive Chairman. The stock ownership guidelines were also revised to provide that PSAs are not counted toward achievement of the applicable guideline multiple until the performance contingencies have been satisfied, and require that if, following the initial five-year compliance period an executive falls below the required ownership level, the executive retain net after-tax shares from SAR exercises or when PSAs or time-based restricted stock awards (“RSAs”) vest until the applicable guideline has been met. For additional details regarding the amended stock ownership guidelines, please see “Corporate Governance Policies—Stock Ownership Guidelines” below.

 

Corporate Governance “Best Practices”

 

Below is a summary of best practices that we have implemented with respect to the compensation of our NEOs because we believe they support our compensation philosophy and are in the best interests of our Company and our stockholders.

 

 

 

Our compensation is aligned with a pay-for-performance philosophy where a substantial portion of executive officer compensation is at-risk and tied to objective performance goals.

 

 

Both annual bonuses and, with limited exceptions, annual equity incentive awards are 100% based on financial operating performance against pre-defined objective goals with no discretion to increase payouts.

 

 

The Compensation Committee engages an independent compensation consultant.

 

 

We maintain robust executive and director stock ownership guidelines.

 

 

We maintain clawback provisions in our equity award agreements, and our long-term incentive plan permits recoupment under various circumstances for cash awards granted thereunder as well.

 

 

We prohibit all executives and directors from hedging and pledging our securities.

 

 

The Compensation Committee conducts an annual risk assessment of our compensation program.

 

 

We do not provide any “single trigger” acceleration of payments or benefits upon a change of control of the Company.

 

 

We do not provide gross-up payments on excise taxes under Section 280G of the Code.

 

 

We provide only limited perquisites to our NEOs.

 

Prior to December 31, 2016, we were considered an “emerging growth company” under federal securities laws and, as a result, we did not hold a say-on-pay vote at our 2016 annual meeting of stockholders. This Proxy Statement marks the first time we are providing a comprehensive Compensation Discussion and Analysis. Because we are no longer an emerging growth company, we are required to conduct an advisory say-on-frequency vote at the Annual Meeting. In addition, we are voluntarily conducting our say-on-pay vote at the Annual Meeting, although we are not yet required to hold such a vote. Our Board and the Compensation Committee greatly value the benefits of maintaining a dialogue with our stockholders to understand their views on our executive compensation program and practices. The Compensation Committee intends to consider the outcome of future say-on-pay votes and is devoted to consistently reviewing and enhancing our compensation programs.

 

18

 

 

Our Executive Compensation Program and Practices

 

The Compensation Committee believes that our executive compensation program is appropriately designed to advance stockholder interests through effective performance-based incentives with retention features. The primary components and associated purposes of our compensation program are as follows:

 

 

Base Salary — Provide the security of a competitive fixed cash payment for services rendered.

 

 

Annual Cash Incentives — Motivate superior annual performance and support our objectives by tying any payout to the achievement against pre-established operating goals.

 

 

Long-Term Equity Incentives — Retain executives and align their interests with those of our long-term stockholders by motivating them to build stockholder value over the life of the grants and beyond. We generally tie long-term equity incentives to the achievement against pre-established long-term operating goals (through PSAs) or the appreciation of our common stock (through SARs).

 

 

Other Benefits — Provide other benefits that are competitive and consistent with the market. We offer general health and welfare benefits, limited perquisites, and severance benefits in the event of involuntary termination, which are generally limited to partial vesting of outstanding equity awards. We have not entered into any agreements with our executives that provide cash severance. Retirement benefits are generally limited to participation in a tax-qualified 401(k) plan, which includes a Company match. In addition, there are certain legacy deferred compensation plans in which our NEOs (other than Messrs. Coyle and Fox) currently participate and legacy retirement plans in which our NEOs (other than Messrs. Coyle and Silverman) currently participate, which carried over from the spin-off.

 

Under our executive compensation program, performance-based incentive compensation comprises a substantial portion of target compensation, and our NEOs have a larger percentage of compensation at-risk than is fixed relative to total compensation. The Compensation Committee considers each component of compensation collectively with other components when establishing the various forms, components, and levels of compensation for our NEOs. In determining the appropriate mix of compensation elements for each NEO, our compensation program seeks to provide a balance between the various components by rewarding performance through annual performance-based cash incentive compensation that encourages achieving and exceeding annual goals and milestones designed to advance our long-term growth strategy and also through long-term equity incentive compensation to align our NEOs interests with those of our stockholders.

 

Objectives of our Executive Compensation Program

 

Our performance-based compensation philosophy for executive officers aims to provide incentives to achieve both short- and long-term business objectives, align the interests of our executive officers and stockholders, and ensure that we can hire and retain talented individuals in a competitive marketplace.

 

Key objectives of our executive compensation program are as follows:

 

 

Attract and retain highly qualified and productive executives.

 

 

Motivate executives to enhance our overall performance and profitability through the successful execution of the Company’s short- and long-term business strategies, with an emphasis on the long-term.

 

 

Align the long-term interests of our executives and stockholders through ownership of Cable ONE stock by executives and by rewarding stockholder value creation.

 

 

Reflect our pay-for-performance philosophy.

 

 

Ensure that compensation opportunities are competitive.

 

19

 

 

Role of the Compensation Committee and the CEO

 

The Board has delegated to the Compensation Committee the responsibility of overseeing the administration of the Company’s compensation plans and the preparation of all reports and documents required by the rules and regulations of the SEC. The Compensation Committee annually reviews and approves the corporate goals and objectives upon which the executive compensation program is based. The Compensation Committee evaluates the CEO’s performance in light of these goals and objectives. Furthermore, the Compensation Committee reviews and makes recommendations to the Board with respect to any incentive compensation plans, including equity-based plans, to be adopted or submitted to the Company’s stockholders for approval.

 

The Compensation Committee meets at least quarterly throughout the year, and may meet more often, as required to address ongoing events. In 2016, the Compensation Committee met six times. Meeting agendas are determined by the Chair of the Compensation Committee with the assistance of our CEO. Our CEO attended all six Compensation Committee meetings, and representatives from the Compensation Committee’s independent compensation consultant, Frederic W. Cook & Co., Inc. (“FW Cook”) attended all four meetings of the Compensation Committee following their engagement by the Compensation Committee in 2016. At the Compensation Committee meetings, our CEO made recommendations to the Compensation Committee regarding the annual base salary, annual cash incentive compensation, and equity compensation of our NEOs (other than our CEO). If needed, external legal counsel also attended Committee meetings.

 

Compensation Setting Process

 

The Compensation Committee makes compensation determinations for our CEO after a deliberation of individual and Company performance for the year, along with an examination of external market data of our industry peer group, based on the surveys described below under “Use of Peer Companies.”

 

The Compensation Committee makes compensation determinations for our NEOs (other than our CEO) based on recommendations made by our CEO, taking into account each NEO’s individual performance (with an assessment of the individual’s accomplishments provided by our CEO) and Company performance, along with an examination of external market data, based on the surveys described below under “Use of Peer Companies.”

 

Independent Compensation Consultant

 

The Compensation Committee has the sole authority to retain and dismiss an independent compensation consultant. In 2016, the Compensation Committee engaged FW Cook, a national executive compensation consulting firm, as its independent consultant. FW Cook reviewed and provided recommendations concerning all of the components of the Company’s executive compensation programs for 2017. FW Cook performs services solely on behalf of the Compensation Committee and has no relationship with the Company or management except as it may relate to performing such services. The Compensation Committee assessed the independence of FW Cook pursuant to the rules of the SEC and the NYSE and concluded that FW Cook is independent and no conflict of interest exists with respect to the services they provided to the Compensation Committee.

 

Use of Peer Companies

 

In 2015 and 2014, prior to the spin-off, compensation for each of our NEOs was determined by the Compensation Committee of GHC’s board of directors (the “GHC Compensation Committee”) based on recommendations made by GHC’s senior management, and, for our NEOs (other than our CEO), in consultation with our CEO. In determining our NEOs’ compensation for 2015 and 2014, GHC’s senior management and the GHC Compensation Committee also referred to the composite market information included in, for Mr. Might, the Equilar Executive Compensation Survey and the U.S. Mercer Benchmark Database (MBD): Executive Survey, which contained compensation information for a broader group of companies in a range of industries with revenues similar to our annual revenues, and, for Ms. Laulis and Mr. Fox, the Croner CTHRA Cable and Satellite MSO Compensation Survey, which contained compensation information for a broader group of companies in the multichannel video programming distributor industry.

 

20

 

 

The Compensation Committee determined the compensation of each of our NEOs for 2016. For our NEOs (other than our CEO), the Compensation Committee’s determination was based on the recommendations of our CEO. In determining our NEOs’ 2016 compensation, the Compensation Committee reviewed the March 2014 Croner CTHRA Cable and Satellite MSO Compensation Survey (the “2014 CTHRA Survey”), the tenure of the NEOs and their internal and external pay equity. The 2014 CTHRA Survey was selected because it provided market data specific to our industry. Since the 2014 CTHRA Survey used for 2016 compensation determinations provided information with respect to 2014 compensation, in determining recommended adjustments to NEO compensation, the figures reflected in the 2014 CTHRA Survey were increased by 6%, representing an assumed rate of inflation. In making its executive compensation decisions, the Compensation Committee does not target a specific percentile for pay, but uses the market data as a guide for making its pay decisions with respect to all pay elements. The factors that influence the amount of compensation awarded include market competition for a particular position, an individual’s experience and past performance inside or outside the Company, compensation history, role and responsibilities within the Company, past and future performance objectives, value of the position within the Company, the Company’s financial performance and the relative cost of living in the Phoenix, Arizona market.

 

The Compensation Committee, with the help of FW Cook and for the first time in 2016, compared each element of compensation to that of a related industry peer group. The peer group was primarily comprised of publicly traded cable, Internet, and telecommunications companies of similar size and was supplemented by technology companies with broadly comparable gross margins and capital expenditures as a percentage of revenues. Across key size metrics, we approximate the peer median. Our annual revenues are slightly below the peer median, but this is counter-balanced by our above-median market capitalization value.

 

In assessing the competitiveness of compensation provided to our NEOs, FW Cook utilized comparative data disclosed in peer companies’ publicly available proxy statements along with other documents filed with the SEC.

 

The following chart shows the peer group developed by us in 2016, along with relevant size and performance data.

 

                           

12 Mo. Avg.

           

Capex as

 
   

Revenue

   

EBITDA

   

Total

   

Market Cap

   

Gross

   

a Percent

 

Company

 

(in millions)

   

(in millions)

   

Employees

   

(in millions)

   

Margin

   

of Revenue

 

Akamai Technologies

  $ 2,303     $ 714       6,084     $ 9,905       65 %     8 %

ATN International

  $ 411     $ 140       1,200     $ 1,172       71 %     24 %

Cincinnati Bell

  $ 1,190     $ 284       3,250     $ 853       43 %     22 %

COGECO

  $ 2,308     $ 1,025       4,740     $ 893       44 %     17 %

Cogent Communications

  $ 433     $ 130       828     $ 1,697       57 %     10 %

Consolidated Communications

  $ 755     $ 269       1,783     $ 1,271       57 %     17 %

General Communication

  $ 943     $ 286       2,370     $ 628       67 %     20 %

Gogo

  $ 574     $ 62       1,073     $ 911       54 %     24 %

Inteliquent

  $ 349     $ 71       177     $ 624       27 %     7 %

NII Holdings

  $ 981     $ 22       2,875     $ 359       58 %     7 %

Range Resources

  $ 1,142     $ 178       744     $ 6,727       31 %     45 %

SBA Communications

  $ 1,624     $ 1,060       1,310     $ 13,136       74 %     9 %

Shenandoah Telecommunications

  $ 467     $ 202       696     $ 1,420       64 %     28 %

Telephone and Data Systems

  $ 5,100     $ 950       10,400     $ 3,060       52 %     13 %

ViaSat

  $ 1,482     $ 255       3,800     $ 3,595       31 %     34 %

Vonage Holdings

  $ 939     $ 106       1,752     $ 1,250       64 %     3 %

Zayo Group Holdings

  $ 1,860     $ 837       3,224     $ 6,910       66 %     40 %
                                                 

Peer Median

  $ 981     $ 255       1,783     $ 1,271       57 %     17 %
                                                 

Cable ONE

  $ 816     $ 334       1,972     $ 2,968       63 %     18 %

- Percent Rank

    35 %     67 %     52 %     66 %     60 %     52 %
                                                 

Source: Standard & Poor's Capital IQ.

                                         

 

In determining the structure of our 2017 executive compensation program, as well as the individual pay levels of our NEOs, the Compensation Committee reviewed competitive market data provided by FW Cook, which compared the various elements of compensation provided to our NEOs, relative to compensation paid to individuals holding similar positions at companies in our executive compensation peer group. FW Cook worked with management to assess the data and review our compensation practices.

 

21

 

 

Elements of our Compensation Program

 

Base Salary

 

The Compensation Committee reviews executive officer base salaries each year (or otherwise at the time of a new hire or promotion) and makes any adjustments it deems necessary. In setting annual base salary levels, the Compensation Committee takes into account competitive considerations, changes in responsibilities, individual performance, tenure in position, internal pay equity, Company performance, market data for individuals in similar positions, retention and advice from our independent compensation consultant. The Compensation Committee gives no specific weighting to any one factor in setting the level of base salary and the process ultimately relies on the subjective exercise of the Compensation Committee’s judgment. As part of the annual review process, Messrs. Coyle and Silverman each received a base salary increase for 2016 to bring them in line with market standards, and all other NEO salaries remained the same as compared to 2015 because the Compensation Committee determined that market conditions did not warrant any other adjustments, as reflected in the table below.

 

Name

 

2016 Base Salary

 

Percent Change from 2015

Thomas O. Might

 

$900,000

 

No change

Julia M. Laulis

 

$450,000

 

No change

Kevin P. Coyle

 

$315,000

 

5%

Stephen A. Fox

 

$299,000

 

No change

Alan H. Silverman

 

$315,000

 

5%

 

Effective January 1, 2017, Mr. Might’s base salary was reduced by 50% to $450,000 in connection with his transition from the role of CEO to Executive Chairman, and Ms. Laulis’ base salary was increased by 22% to $550,000 in connection with her promotion to President and CEO. No other NEO base salary changes were made for 2017.

 

Annual Cash Incentive Plan

 

Our annual cash incentive program is intended to motivate and reward our NEOs to achieve and exceed annual goals and milestones that are expected to advance our long-term growth strategy.

 

Each of our NEOs was awarded a cash incentive opportunity at the beginning of 2016, pursuant to the 2016 Bonus Plan. The 2016 Bonus Plan provided for payouts based on our financial performance compared to goals set immediately prior to the beginning of 2016, with a target bonus for each NEO expressed as a percentage of such executive’s base salary. For 2016, these target bonuses percentages were as follows: Mr. Might, 100%; Ms. Laulis, 50%; Mr. Coyle, 40%; Mr. Fox, 40%; and Mr. Silverman, 40%. Payouts are capped at 200% of target, and the Compensation Committee retains negative discretion to further reduce any payouts.

 

Bonus payouts under the 2016 Bonus Plan were subject to the attainment of goals related to Adjusted EBITDA growth and capital expenditures as a percentage of revenues. In order to determine Adjusted EBITDA, we begin with our net income (as defined under GAAP and described in our 2016 Annual Report on Form 10-K, filed on March 1, 2017) and adjust for net interest expense; income taxes; depreciation and amortization; equity-based incentive compensation expense; for 2015, pre-spin cash-based incentive compensation expense; loss (gain) on deferred compensation; other (income) expense, net; acquisition-related costs, loss on disposal of fixed assets; and other unusual operating expenses. Furthermore, the Compensation Committee was permitted to adjust the calculation of Adjusted EBITDA growth and capital expenditures as a percentage of revenues in the event of any share repurchases; losses on the disposition or acquisition of a business; expenses associated with changes in accounting principles, practices or interpretations; losses on discontinued operations; third-party legal fees or any payments associated with litigation; third-party legal, audit, consulting or banking costs associated with capital raising, merger or acquisition activity; and other expenses or losses that were disclosed as a special, one-time, unusual or infrequent item in accordance with GAAP.

 

22

 

 

We believe that the combination of Adjusted EBITDA growth and capital expenditures as a percentage of revenues reflect our performance across several key dimensions, including profitability, cash outflows for capital expenditures, and our ability to fund operations and make additional investments with internally-generated funds. As such, performance on these measures was the basis for determining earned bonuses under the 2016 Bonus Plan, as follows:

 

 

Actual 2016 Adjusted EBITDA growth over actual 2015 Adjusted EBITDA growth (as reported in our financial statements, and subject to adjustment as provided above); and

 

 

Capital spending as a percentage of total revenues (as reported in accordance with GAAP, and subject to adjustment as provided above).

 

           

Adjusted EBITDA Growth

 
                                                                                   
           

Thresh.

                           

  Target

                         

Max.

 
           

 

<97%     98%     99%     100%     101%     102%     103%     104%     105%     106%     107%     108%  

Capex

as a

% of

Revenue

Thresh.

  22 %     0%     25%     30%     35%     40%     45%     50%     60%     70%     80%     90%     100%  
    21 %     0%     30%     36%     42%     48%     54%     60%     72%     84%     96%     108%     120%  
    20 %     0%     35%     42%     49%     56%     63%     70%     84%     98%     112%     126%     140%  
    19 %     0%     40%     48%     56%     64%     72%     80%     96%     112%     128%     144%     160%  
    18 %     0%     45%     54%     63%     72%     81%     90%     108%     126%     144%     162%     180%  

Target

  17 %     0%     50%     60%     70%     80%     90%     100%     120%     140%     160%     180%     200%  
    16 %     0%     58%     69%     81%     92%     104%     115%     138%     161%     184%     200%     200%  
    15 %     0%     65%     78%     91%     104%     117%     130%     156%     182%     200%     200%     200%  
    14 %     0%     73%     87%     102%     116%     131%     145%     174%     200%     200%     200%     200%  

Max.

  13 %     0%     80%     96%     112%     128%     144%     160%     192%     200%     200%     200%     200%  

 

On March 1, 2017, the Compensation Committee certified the results of the performance goals. The Compensation Committee approved a performance factor of 200% based on Adjusted EBITDA growth of 110.3%, which was greater than the maximum level of 108%, and capital spending as a percentage of total revenues of 15.3%. The Compensation Committee did not apply any adjustment to the performance results under the 2016 Bonus Plan. The Compensation Committee approved the following bonus payments under the 2016 Bonus Plan for our NEOs:

 

2016 Bonus Plan Payouts

 

Name

 

Target Bonus

Percentage

 

Target

Bonus

 

Performance Results

(as a Percentage of Target)

 

Bonus Payout

Thomas O. Might

 

100%

 

$900,000

 

200%

 

$1,800,000

Julia M. Laulis

 

50%

 

$225,000

 

200%

 

$450,000

Kevin P. Coyle

 

40%

 

$126,000

 

200%

 

$252,000

Stephen A. Fox

 

40%

 

$119,600

 

200%

 

$239,200

Alan H. Silverman

 

40%

 

$126,000

 

200%

 

$252,000

 

For our annual executive bonus plan for 2017, the target bonus percentage for Ms. Laulis was increased to 100% of base salary to reflect her appointment as President and CEO and her increased duties and responsibilities and the target bonus percentage for Messrs. Coyle, Fox and Silverman were increased to 50% of base salary to bring them in line with market standards. As a result of his appointment as Executive Chairman, Mr. Might will not be eligible to receive an annual bonus under our annual executive bonus plan for 2017. Payouts remain capped at 200% of target, and the Compensation Committee retains negative discretion to further reduce any payouts.

 

23

 

 

Special One-Time Bonuses

 

In March 2016, the Compensation Committee approved a one-time discretionary bonus of $37,999 for Mr. Coyle that was paid at the same time as 2015 cash bonuses were paid to our executives. This one-time bonus recognized his contributions to the successful completion of the spin-off, aligned his total compensation for 2015 with market standards and provided him with an additional cash bonus award in respect of fiscal year 2015 because his annual bonus under the 2015 Executive Incentive Compensation Plan (the “2015 EICP”) was prorated based on his hire date in 2015.

 

Long-Term Annual Equity Incentive

 

The Compensation Committee considers its long-term equity incentive program to be a critical component of the executive officer compensation program as it motivates and rewards executive officers over the long-term and further aligns the interests of our executives with those of our stockholders. Our typical practice is to grant our annual equity awards in the form of PSAs in early January each year. In addition, on a case-by-case basis, the Compensation Committee approves grants of equity awards, typically in the form of RSAs and SARs, for new hires, promotions and other special circumstances. Equity grants to our NEOs are described in greater detail in the 2016 Grants of Plan Based Awards and the Outstanding Equity Awards at Fiscal Year-End tables on pages 32 and 33, respectively, of this Proxy Statement.

 

2016 Performance-Based Stock Award Grants

 

For 2016, the Compensation Committee granted our NEOs equity awards entirely in the form of PSAs under the Existing 2015 Plan. The PSAs for 2016 were subject to the attainment of the same goals and performance targets related to Adjusted EBITDA growth and capital expenditures as a percentage of revenues as bonuses under the 2016 Bonus Plan because the Compensation Committee viewed these metrics as key indicators of our performance, as further described under the section “Annual Cash Incentive Plan” above. The decisions to use the same performance measures for the annual cash bonus plan and PSAs was based on: (1) the belief that these metrics are the best measures of performance and are the principle drivers of stockholder value; and (2) challenges in setting meaningful multi-year performance goals shortly following the spin-off. While earned over a one-year performance period, the PSAs cliff-vest on the third anniversary of the grant date, which supports retention and discourages executive officers from taking excessive risks for short-term gains as the value delivered ultimately is contingent on longer-term stock price performance. (For further information on the new design for 2017 PSA grants, which are based on three-year cumulative Adjusted EBITDA less capital expenditures, and as such, are differentiated from our 2017 annual executive bonus plan metrics, see “2017 Compensation Actions—2017 Performance-Based Stock Award Grants” below.)

 

Due to the large, non-recurring grants of restricted stock awards and SARs to our executives in 2015 that were intended to align their interests with those of our long-term stockholders and were also granted in lieu of the stock options, performance units and other special incentives certain of our NEOs had typically received as employees of GHC prior to the spin-off, the Compensation Committee determined to limit the 2016 annual equity grant to our NEOs to a target number of PSAs equal to 50% of each executive’s starting base salary for 2016, divided by the closing price of our common stock on the grant date, January 4, 2016, of $431.67. The PSAs are subject to the terms and conditions of the Existing 2015 Plan as well as an award agreement. The PSAs are scheduled to cliff-vest on January 4, 2019, generally subject to continued service with the Company through such date and achievement of the performance goals described above with respect to the fiscal year 2016.

 

24

 

 

On March 1, 2017, the Compensation Committee certified the results of the performance goals for our 2016 PSA grants. The Compensation Committee approved a performance factor of 200% based on Adjusted EBITDA growth of 110.3%, which was greater than the maximum level of 108%, and capital spending as a percentage of total revenues of 15.3%. The Compensation Committee did not apply any adjustment to the performance results. The Compensation Committee approved the following performance results for the 2016 PSAs for our NEOs:

 

2016 PSA Grants

 

Name

 

Target Number of PSAs

 

Performance Results

(as a Percentage of Target)

 

Earned PSAs (1)

 

Thomas O. Might

 

1,037

 

200%

 

2,074

 

Julia M. Laulis

 

518

 

200%

 

1,036

 

Kevin P. Coyle

 

363

 

200%

 

726

 

Stephen A. Fox

 

344

 

200%

 

688

 

Alan H. Silverman

 

363

 

200%

 

726

 
          
                
(1) Earned PSAs are subject to service-based vesting conditions through January 4, 2019.
 

Other Benefits

 

Our NEOs are entitled to employee benefits generally available to all full-time employees of the Company, including health and welfare benefits. In designing these offerings, the Company seeks to provide an overall level of benefits that is competitive with the level of benefits offered by similar companies in the markets in which it operates. In addition, our NEOs are eligible to participate in certain retirement and deferred compensation plans as described in more detail below under “Retirement Plans.”

 

Perquisites

 

We provide our NEOs with limited perquisites. In 2016, we paid for certain costs in connection with certain of our NEOs’ and their spouses’ travel to and participation in sales or performance incentive trips and certain other business conferences. We also reimbursed Ms. Laulis and Mr. Fox an amount representing part of the cost of our data, video and voice service, a benefit that we provide at no cost to all of our employees who reside in one of our markets. For more information regarding these payments, please see the “All Other Compensation” column of the 2016 Summary Compensation Table on page 30 of this Proxy Statement. We do not provide any other perquisites to our NEOs.

 

Severance Benefits

 

Consistent with our policy, we have not entered into any employment or severance agreements with any of our NEOs. As such, we do not have any agreements with any of our NEOs that provide cash payments upon a termination of employment or a change of control of the Company (except for Mr. Might’s 1999 special deferred compensation award, the GHC Retirement Plan and the Cable One, Inc. Supplemental Executive Retirement Plan (the “Cable ONE SERP”) described below in the “Retirement Benefits” section beginning on page 34 of this Proxy Statement).

 

We do not provide any “single trigger” change of control benefits nor any gross-up payments on excise taxes under Section 280G of the Code. In order to encourage continuity of the executive officers in the event of a change of control and promote the successful execution of the Company’s short- and long-term business strategies, our outstanding equity awards contain a “double trigger” provision, which means the awards only vest upon a qualifying termination of employment that occurs within 18 months following a change of control, as described below in the “Potential Payments Upon Termination or Change of Control” section beginning on page 38 of this Proxy Statement.

 

Retirement Plans

 

Qualified Defined Contribution Plan

 

We maintain the Cable ONE 401(k) Plan, which is a tax-qualified defined contribution plan. We provide matching contributions on up to 5% of an employee’s eligible compensation, up to the salary limit applicable to tax-qualified plans ($265,000 in 2016). Employees, including our NEOs, are eligible to receive matching contributions after one year of service, with matches fully vested when made.

 

25

 

 

Nonqualified Supplemental Executive Retirement Plan

 

Effective as of the spin-off, we established the defined contribution portion and defined benefit portion of the Cable ONE SERP, under which we assumed all obligations to current and former Cable ONE employees who participated in the defined contribution portion or the defined benefit portion of the GHC SERP, including our NEOs other than Messrs. Coyle and Silverman. In connection with the spin-off, on July 1, 2015, benefit accruals were frozen under the Cable ONE SERP, and the plan was closed to new participants. No employee contributions were permitted under the defined contribution portion of the Cable ONE SERP after December 31, 2015.

 

Nonqualified Deferred Compensation Plans

 

Effective as of the spin-off, we established the Cable ONE Deferred Compensation Plan with terms substantially similar to the GHC Deferred Compensation Plan, under which plan we remain responsible for any obligations to current and former Cable ONE employees who participated in the GHC Deferred Compensation Plan, including our NEOs other than Messrs. Coyle and Fox. In connection with the spin-off, on July 1, 2015, the Cable ONE Deferred Compensation Plan was closed to new participants, and no deferrals were permitted after December 31, 2015.

 

Additionally, in 1999, Mr. Might was granted a special deferred compensation award by GHC in recognition of his extraordinary efforts in growing our Company. Annual payouts under this arrangement will commence when Mr. Might separates service with our Company. Since the award has been deferred beyond Mr. Might’s 65th birthday due to his continued employment with us, the base amounts began accruing interest on May 1, 2016 at an annual rate corresponding to the applicable rate for 12-month U.S. Treasury bills (set at each anniversary and carried forward), which is credited and compounded on an annual basis. The award may be payable in installments upon mutual agreement of Mr. Might and us, not to extend beyond a 10-year period; however, in the event of Mr. Might’s death, all amounts due will be payable in a lump sum within 60 days. No amounts were paid to Mr. Might in 2016, 2015 or 2014 in respect of this arrangement.

 

Further explanation of the retirement plans can be found in connection with the Pension Benefits Table and Nonqualified Deferred Compensation Table beginning on pages 36 and 37, respectively, of this Proxy Statement.

 

2017 Compensation Actions

 

2017 PSA Grants

 

As described above, the Compensation Committee approved a new design for the 2017 PSA grants under our Existing 2015 Plan, which are based on three-year cumulative Adjusted EBITDA less capital expenditures, and as such, are differentiated from our 2017 annual executive bonus plan metrics. See Annex A of this Proxy Statement, entitled “Use of Non-GAAP Financial Metrics,” for the definition of Adjusted EBITDA less capital expenditures, which is reconciled to net income (the most directly comparable measure under GAAP) when used as a performance measure. In her new role as President and CEO, Ms. Laulis received a 2017 PSA grant with a target grant date fair value of 100% of her base salary ($550,000), which was increased from a target grant date fair value of 50% of her base salary for 2016. In his new role as Executive Chairman, Mr. Might was granted PSAs with a target grant date fair value of $950,000. Pursuant to the applicable award agreements, all or a portion of these awards may vest in the event of certain terminations of employment either prior to or following a change of control of the Company.

 

2017 RSA and SAR Grants

 

In January 2017, the Compensation Committee approved one-time RSA grants to Messrs. Coyle and Silverman, which are in respect of 500 shares each and vest in equal annual installments over four years. These grants were awarded in order to support retention. In addition, the Compensation Committee approved one-time grants of 5,000 SARs to Ms. Laulis and 1,000 SARs to Mr. Fox, which also vest in equal annual installments over four years and have a ten-year term (generally subject to the executive’s continued employment with us through the applicable vesting date). Ms. Laulis’ SARs grant was awarded in connection with her appointment as President and CEO effective January 1, 2017, and Mr. Fox’s SARs grant was awarded in order to support retention.

 

26

 

 

Corporate Governance Policies

 

Stock Ownership Guidelines

 

The Board has adopted stock ownership guidelines applicable to our executives, including our NEOs, and our non-employee directors because we believe executives and directors will more effectively pursue the long-term interests of stockholders if they are stockholders themselves.

 

These guidelines generally require executives to hold shares of our common stock having a value equal to a multiple of the executives’ base salary and non-employee directors to hold shares of our common stock having a value equal to a multiple of the non-employee directors’ base retainer. Under the guidelines in effect for 2016, RSAs, PSAs (based on the target number of shares until the date the Compensation Committee determines whether the applicable performance goal has been achieved, and after such date, based on the actual number of shares earned), and unrestricted shares all counted towards the guidelines for executives and unvested and deferred restricted stock units (“RSUs”) all counted towards the guidelines for non-employee directors. SARs are not counted toward compliance with the guidelines. An executive or non-employee director is expected to achieve the applicable multiple set forth in the guidelines within five years of the later of the date of initial adoption of the guidelines, which was August 4, 2015, or the date of the executive’s initial election to such position or the non-employee director’s initial election to the Board, except as otherwise approved by the Compensation Committee (the “Compliance Period”). Compliance with these stock ownership guidelines is reviewed annually, and all of our NEOs and non-employee directors were in compliance with the stock ownership guidelines as of December 31, 2016. For 2016, the stock ownership guidelines for executives and non-employee directors were the following multiples:

 

Position

 

2016

CEO

 

5.0

President

 

2.5

Senior Vice President

 

2.0

Vice President

 

2.0

Non-Employee Director

 

0.5

 

In 2017, the Compensation Committee amended the stock ownership guidelines applicable to our executive officers, as a multiple of the executives’ base salary as follows:

 

Position

 

2017

Executive Chairman

 

6.0

CEO

 

6.0

President

 

3.5

Chief Operating Officer

 

3.5

Senior Vice President

 

3.0

Vice President

 

2.0

 

The amended stock ownership guidelines also include the following clarifications or modifications:

 

 

In the case of a promotion to a level with a higher ownership requirement, an additional two-year Compliance Period will be provided to acquire the incremental shares required.

 

 

In the case of an executive officer who holds a position at more than one level (e.g., CEO and President), the higher ownership requirement will apply.

 

 

Shares held in trust and by direct family members (i.e., spouses and children) and in retirement accounts all count towards the guidelines.

 

 

PSAs are not counted toward achievement of the applicable guideline until the performance contingencies have been satisfied.

 

27

 

 

 

During the Compliance Period, up to 50% of net after-tax shares can be sold at the time the PSA, RSA or RSU vests or the SAR is exercised, and the executive or non-employee director will be required to retain the remaining 50% of net after-tax shares until in compliance with the applicable guideline. Once outside of the Compliance Period, if an executive’s or a non-employee director’s ownership falls below the required ownership level, that person will be required to retain 100% of net after-tax shares at the time a PSA, RSA, or RSU vests or a SAR is exercised, until in compliance with the applicable guideline.

 

Prohibition on Derivative Trading, Hedging and Pledging

 

Our Insider Trading Policy provides that it is inappropriate for any executive officer or director, among others, to enter into speculative transactions in the Company’s securities and prohibits them from (1) trading derivative securities, such as puts, calls, options and similar instruments; (2) entering into hedging or monetization transactions or similar arrangements, such as collars and forward-sale contracts; (3) engaging in short sale transactions in the Company’s securities; and (4) buying the Company’s securities on margin or pledging any Company securities as collateral, including borrowing against any account in which such securities are held.

 

Clawback Policy

 

Our Existing 2015 Plan contains a recoupment provision, such that award agreements may require the repayment of cash and equity awards if (1) the participant has engaged in fraud or other willful misconduct that contributes to any financial restatements or irregularities or material loss to the Company or any of our affiliates; (2) the participant engages in conduct constituting “cause” (as defined in the award agreement); (3) the participant breaches the restrictive covenants that are applicable under the award agreement or (4) the participant otherwise violates any recoupment or clawback policy adopted by the Company to the extent necessary to address the requirements of applicable law (including the Dodd-Frank Wall Street Reform and Consumer Protection Act). All of our executive officers’, including our NEOs’, outstanding equity award agreements contain such a clawback requirement.

 

Policy with Respect to Tax Deductibility of Compensation

 

As part of its role, the Compensation Committee reviews and considers the deductibility of executive compensation under Section 162(m) of the Code. Section 162(m) provides that we may not deduct compensation of more than $1,000,000 paid in any year to the CEO or any of the three other most highly compensated officers (excluding the Chief Financial Officer), unless the compensation qualifies as “performance-based compensation” under Section 162(m). The Compensation Committee has considered the potential impact of Section 162(m) on our compensation plans and has determined that it is our preference to qualify our executives’ compensation for deductibility under Section 162(m), to the extent the Compensation Committee believes it is consistent with the Company’s best interests. Our compensation plans have generally been designed to permit the Compensation Committee to grant awards that qualify for deductibility under Section 162(m). While the Compensation Committee considers deductibility as one factor in determining executive compensation, the Compensation Committee believes that stockholder interests are best served by the Compensation Committee retaining the flexibility to approve compensation that is not deductible by the Company for tax purposes.

 

Compensation Program Risk Assessment

 

As part of its oversight role, the Compensation Committee considers the impact of our compensation program, policies and practices (both at the executive and below-executive levels), on the Company’s overall risk profile. Specifically, the Compensation Committee, with assistance from our CEO, reviews the compensation plans, incentive plan design, incentive payouts and factors that may affect the likelihood of excessive risk taking to determine whether they present a significant risk to the Company. We believe that our pay program provides an effective balance in cash and equity mix and short- and longer-term performance periods, and also allows for the Compensation Committee’s discretion. The Company also maintains policies to mitigate compensation-related risk such as stock ownership guidelines, caps on incentive payouts, vesting periods on equity, insider-trading prohibitions, and independent Compensation Committee oversight. Based on this review, the Compensation Committee determined that the risks arising from the Company’s compensation policies and practices are not reasonably likely to have a material adverse effect on the Company.

 

28

 

 

COMPENSATION COMMITTEE REPORT

 

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis set forth above with management. Based on its review and discussion with management, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.

 

Wallace R. Weitz, Chairman

Brad D. Brian

Alan G. Spoon

 

29

 

 

2016 Summary Compensation Table

 

The following table shows the compensation paid by the Company during 2016, 2015 and 2014 to the principal executive officer, the principal financial officer and the three other most highly compensated executive officers of the Company based on 2016 compensation, except in the cases of Mr. Fox, who was not an NEO in 2014 and Messrs. Coyle and Silverman, who were not NEOs in 2015 or 2014.

 

Name and Principal Position

 

Year

 

Salary(1)

   

Bonus(2)

   

Stock Awards(3)

   

Option Awards(3)

   

Non-Equity Incentive Plan Compensation(4)

   

Change in Pension Value and Nonqualified Deferred Compensation Earnings(5)

   

All Other Compensation(6)

   

Total

 

Thomas O. Might

 

2016

  $ 900,000           $ 447,642           $ 1,800,000           $ 74,967     $ 3,222,609  
Chairman of the Board and   2015   $ 900,000           $ 3,906,594     $ 2,956,758     $ 2,215,500           $ 69,498     $ 10,048,350  
Chief Executive Officer   2014   $ 749,219                       $ 1,642,500     $ 604,758     $ 32,089     $ 3,028,566  

Julia M. Laulis

 

2016

  $ 450,000           $ 223,605           $ 450,000     $ 8,676     $ 43,614     $ 1,175,895  
President and Chief   2015   $ 450,000           $ 1,368,278     $ 1,160,026     $ 569,500           $ 27,200     $ 3,575,004  
Operating Officer   2014   $ 384,616                       $ 374,400     $ 29,782     $ 19,947     $ 808,745  

Kevin P. Coyle

 

2016

  $ 315,000     $ 37,999     $ 156,696           $ 252,000           $ 19,731     $ 781,426  
Senior Vice President and Chief Financial Officer                                                                    

Stephen A. Fox

 

2016

  $ 299,000           $ 148,494           $ 239,200     $ 8,812     $ 30,862     $ 726,368  
Senior Vice President and Chief Network Officer   2015   $ 299,000           $ 1,039,907     $ 950,698     $ 294,832           $ 18,566     $ 2,603,003  

Alan H. Silverman

 

2016

  $ 315,000           $ 156,696           $ 252,000           $ 24,229     $ 747,925  
Senior Vice President, General Counsel and Secretary                                                                    

                         

(1)

Amounts in this column represent base salary earned by each NEO from GHC prior to the spin-off and from Cable ONE following the spin-off for 2015 and 2016 and base salary paid to each NEO by GHC for 2014.

 

(2)

Amounts in this column represent a discretionary bonus payment in recognition of Mr. Coyle’s contributions to the Company as described in further detail in the section entitled “Compensation Discussion and AnalysisElements of Our Compensation Program—Special One-Time Bonuses” above.

 

(3)

Amounts in this column represent the grant date fair value of the PSA, RSA and SAR awards computed in accordance with FASB ASC Topic 718 and reflect an estimate of the grant date fair value of PSA, RSA and SAR grants made through the close of the 2016 fiscal year, rather than amounts paid to or realized by our NEOs. The amounts included for the PSAs granted to each NEO are based on achievement of the underlying performance conditions at target (i.e., 100% of the target award value), which was determined to be the probable outcome at the time of grant. There can be no assurance that estimated amounts will be realized, and amounts could ultimately exceed the estimated amounts. See Note 11 of the Notes to the Consolidated Financial Statements contained in our Annual Report on Form 10-K, filed on March 1, 2017, for a discussion of the assumptions used in valuation of the PSA, RSA and SAR awards.

 

 

Set forth below is the maximum value for the PSAs granted to the NEOs during 2016 (i.e., 200% of the target award value).

 

Name

 

Stock Awards –

Maximum Value of PSAs

 

Thomas O. Might

  $ 895,284  

Julia M. Laulis

  $ 447,210  

Kevin P. Coyle

  $ 313,392  

Stephen A. Fox

  $ 296,989  

Alan H. Silverman

  $ 313,392  

 

30

 

 

(4)

Amounts in this column for 2016 represent payments under the 2016 Bonus Plan. Amounts in this column for 2015 represent payments under the 2015 EICP and prorated payments under the performance units granted under GHC’s 2012 Incentive Compensation Plan for the 2013-2016 award cycle (the “2013-2016 Performance Unit Plan”) for each NEO, as follows: Mr. Might, $1,278,000 in annual bonus and $937,500 in performance units; Ms. Laulis, $319,500 in annual bonus and $250,000 in performance units; and Mr. Fox, $169,832 in annual bonus and $125,000 in performance units. Amounts in this column for 2014 represent payments under the annual bonus component of GHC’s 2012 Incentive Compensation Plan (the “2014 AIP”) and the performance units granted under GHC’s 2012 Incentive Compensation Plan for the 2011-2014 award cycle (the “2011-2014 Performance Unit Plan”) for Mr. Might and Ms. Laulis, as follows: Mr. Might, $810,000 in annual bonus and $832,500 in performance units; and Ms. Laulis, $207,900 in annual bonus and $166,500 in performance units. The 2016 Bonus Plan is described in further detail in the section entitled “Compensation Discussion and AnalysisElements of Our Compensation Program—Annual Cash Incentive Plan” above.

 

(5)

There were no above-market or preferential earnings on compensation that was deferred on a basis that is not tax-qualified. Thus, no such earnings are reflected in the amounts shown in this column.

 

Changes in the present value of benefits in 2016 are attributable to the Cable ONE SERP as follows: Mr. Might, ($31,482); Ms. Laulis, $8,676; Mr. Fox, $8,812.

 

The values of accumulated plan benefits were determined using a discount rate of 3.95% at December 31, 2016 and 4.22% at December 31, 2015 and using RP-2016 Fully Generational Mortality Table for males and females using Scale MP-2016 at December 31, 2016 and RP-2015 Fully Generational Mortality Table for males and females using Scale MP-2015 at December 31, 2015.

 

See the Pension Benefits Table and the “Retirement Benefits” section below for additional information regarding these benefits.

 

(6)

For 2016, the amounts presented include the information in the following table: 

 

All Other Compensation

 

Name

 

Perquisites(6a)

   

401(k) Company Contributions(6b)

   

PSA Dividends(6c)

   

Total

 

Thomas O. Might

  $ 7,143     $     $ 67,824     $ 74,967  

Julia M. Laulis

  $ 7,738     $ 11,192     $ 24,684     $ 43,614  

Kevin P. Coyle

  $     $ 7,269     $ 12,462     $ 19,731  

Stephen A. Fox

  $ 900     $ 11,500     $ 18,462     $ 30,862  

Alan H. Silverman

  $     $ 10,471     $ 13,758     $ 24,229  

 

                            

(6a)

Amounts in this column represent (i) for Mr. Might and Ms. Laulis, (A) travel and related expenses incurred by the NEO’s spouse in connection with attending industry conferences and/or a Company sales or performance incentive trip and (B) activity and entertainment expenses incurred by each of our NEOs and such person’s spouse on such trips and (ii) for Ms. Laulis and Mr. Fox, reimbursement for an amount representing part of the cost of our data, video and voice service, a benefit that we provide at no cost to all of our employees who reside in one of our markets.

 

(6b)

The NEOs are immediately 100% vested in the 401(k) Company contributions, which are described in further detail in the section entitled “Narrative Disclosure to Summary Compensation Table—Retirement Benefits—Defined Contribution Plans” below.

 

(6c)

Amounts in this column represent dividends attributable to PSAs granted under the Existing 2015 Plan that are not included in the grant date fair value of such PSAs reported in the “Stock Awards” column of the 2016 Summary Compensation Table. PSAs are credited with cash dividends, which are subject to the same vesting terms as the underlying award. Dividends on PSAs will not vest unless and until the performance conditions applicable to the award have been achieved.

 

31

 

 

2016 Grants of Plan-Based Awards

 

The following table shows information with respect to each equity-based award granted to our NEOs during 2016.

 

                   

Estimated Possible Payouts Under
Non-Equity Incentive Plan Awards
(2)

   

Estimated Possible Payouts Under
Equity Incentive Plan Awards
(3)

   

All Other Stock Awards: Number of Shares of Stock

   

All Other Option Awards: Number of Securities Underlying

    Exercise or Base Price of Option     Grant Date Fair Value of Stock and  
Name   Grant Date    

Approval

Date (1)

   

Threshold
($)

 

Target
($)

 

Maximum
($)

   

Threshold
(
#)

 

Target
(
#)

 

Maximum
(
#)

    or Units
(#)
    Options
(#)
   

Awards
($/Sh)

   

Option

Awards

 

Thomas O.

              $ 900,000   $ 1,800,000                                        
Might   01/04/2016     11/02/2015                         1,037     2,074                       $ 447,642  

Julia M.

              $ 225,000   $ 450,000                                        
Laulis   01/04/2016     11/02/2015                         518     1,036                       $ 223,605  

Kevin P.

              $ 126,000   $ 252,000                                        
Coyle   01/04/2016     11/02/2015                         363     726                       $ 156,696  

Stephen A.

              $ 119,600   $ 239,200                                        
Fox   01/04/2016     11/02/2015                         344     688                       $ 148,494  

Alan H.

              $ 126,000   $ 252,000                                        
Silverman   01/04/2016     11/02/2015                         363     726                       $ 156,696  

                          

(1)

The date in this column is the date the Compensation Committee took action to approve the equity-based award.

 

(2)

Amounts in this column represent the target and maximum payouts for the NEOs under the 2016 Bonus Plan. There is no threshold payout with respect to this award under the 2016 Bonus Plan.

 

(3)

Amounts in this column represent PSAs granted under the Existing 2015 Plan as part of our long-term incentive compensation program. There is no threshold payout with respect to the PSAs. The terms of the PSAs are described in further detail in the section entitled “Compensation Discussion and AnalysisElements of Our Compensation Program—Long-Term Annual Equity Incentive” above.

 

Narrative Disclosure to 2016 Summary Compensation Table and 2016 Grants of Plan-Based Awards Table

 

The following describes the material features of the compensation disclosed in the 2016 Summary Compensation Table and the 2016 Grants of Plan-Based Awards table.

 

Consistent with our policy, we have not entered into any employment agreements with, or guaranteed severance packages to, any of our NEOs. For additional information about the base salary, annual cash incentive awards and special one-time discretionary bonus awarded to our NEOs, see the sections entitled “Compensation Discussion and AnalysisElements of Our Compensation Program—Base Salary,” “Annual Cash Incentive Plan” and “—Special One-Time Bonuses” above.

 

Long-Term Equity Incentive Compensation. Each of our NEOs was awarded a long-term equity incentive opportunity at the beginning of 2016. The 2016 Summary Compensation Table reflects the grant date fair value of the PSAs granted in 2016. The “Stock Awards” column in the 2016 Summary Compensation Table and the “Estimated Possible Payouts Under Equity Incentive Plan Awards” column in the 2016 Grant of Plan-Based Awards table provide information regarding the long-term annual equity incentive program for each NEO in 2016. For additional information, see the section entitled “Compensation Discussion and AnalysisElements of Our Compensation Program—Long-Term Annual Equity Incentive” above.

 

On July 1, 2015, the Compensation Committee approved the grant of PSAs under the Existing 2015 Plan to certain executives of the Company whose equity awards issued by GHC were forfeited in connection with the spin-off (the “Replacement Shares”) or who did not receive an equity award from GHC in 2015 in anticipation of the spin-off (the “Staking Shares” and, together with the Replacement Shares, the “Spin-Related Shares”). The Spin-Related Shares are subject to both service-based and performance-based vesting conditions. The Replacement Shares cliff-vested on December 12, 2016, which was the vesting date of the forfeited awards that they replaced, and the Staking Shares are scheduled to cliff-vest on January 2, 2018. The performance goals for the Spin-Related Shares, which have been met, related primarily to year over year growth in Adjusted EBITDA less capital expenditures. See Annex A of this Proxy Statement, entitled “Use of Non-GAAP Financial Metrics,” for the definition of Adjusted EBITDA less capital expenditures, which is reconciled to net income (the most directly comparable measure under GAAP) when used as a performance measure. All Spin-Related Shares are subject to the terms and conditions of the Existing 2015 Plan as well as an award agreement entered into by each executive receiving a grant and the Company, the material terms of which were also approved by the Compensation Committee. The NEOs received the following Spin-Related Shares: Mr. Might, 5,125 Replacement Shares and 5,142 Staking Shares; Ms. Laulis, 1,025 Replacement Shares and 2,571 Staking Shares; Mr. Coyle, 1,714 Staking Shares; Mr. Fox, 1,025 Replacement Shares and 1,708 Staking Shares; and Mr. Silverman, 216 Replacement Shares and 1,714 Staking Shares. In addition, the Spin-Related Shares are credited with cash dividends, which are subject to the same vesting terms as the underlying award. Dividends on the Spin-Related Shares did not, and will not, vest unless and until the performance conditions applicable to the underlying award have been achieved. There were no PSAs or RSAs granted to our NEOs in 2014.

 

32

 

 

SARs. The 2016 Summary Compensation Table reflects the grant date fair value of the SAR awards made in 2015 to our NEOs (other than Messrs. Coyle and Silverman). On August 4, 2015, the Compensation Committee approved the grant of SARs under the Existing 2015 Plan to certain executives effective on September 1, 2015. The SARs vest in four equal ratable installments beginning on the first anniversary of the grant date (generally subject to the holder’s continued employment with the Company through the applicable vesting date) and are otherwise subject to the terms and conditions of the applicable award agreement, a form of which was approved by the Compensation Committee on August 4, 2015. The specified NEOs received the following SARs: Mr. Might, 33,900 SARs; Ms. Laulis, 13,300 SARs; and Mr. Fox, 10,900 SARs. There were no SARs granted to our NEOs in 2016 or 2014.

 

Perquisites. In 2016, 2015 and 2014, we paid for certain costs in connection with our NEOs’ and their spouses’ travel to and participation in sales or performance incentive trips and certain other business conferences. In 2016 and 2015, we also reimbursed our NEOs an amount representing part of the cost of our data, video and voice service, a benefit that we provide at no cost to all of our employees who reside in one of our markets. See the “All Other Compensation” column of the 2016 Summary Compensation Table for more information regarding these payments. We do not provide any other perquisites to our NEOs.

 

Outstanding Equity Awards at Fiscal Year-End

 

The following table shows the number of shares covered by exercisable and unexercisable SARs and unvested PSAs held by our NEOs on December 31, 2016.

 

 

       

SAR Awards

   

Stock Awards

 

Name

 

Grant Date (1)

 

Exercisable

   

Unexercisable

   

SAR Exercise

Price

   

SAR

Expiration

Date

   

Number of Shares or

Units of Stock That

Have Not Vested (2)

   

Market Value of

Shares or Units of

Stock That Have Not

Vested (3)

 

Thomas O. Might

 

07/08/2015

                            5,142     $ 3,196,936  
    09/01/2015     8,475       25,425     $ 422.31     09/01/2025              
    01/04/2016                             2,074     $ 1,289,468  

Julia M. Laulis

 

07/08/2015

                            2,571     $ 1,598,468  
    09/01/2015     3,325       9,975     $ 422.31     09/01/2025              
    01/04/2016                             1,036     $ 644,112  

Kevin P. Coyle

 

07/08/2015

                            1,714     $ 1,065,645  
    09/01/2015     1,500       4,500     $ 422.31     09/01/2025              
    01/04/2016                             726     $ 451,376  

Stephen A. Fox

 

07/08/2015

                            1,708     $ 1,061,915  
    09/01/2015     2,725       8,175     $ 422.31     09/01/2025              
    01/04/2016                             688     $ 427,750  

Alan H. Silverman

 

07/08/2015

                            1,714     $ 1,065,645  
    09/01/2015     2,825       8,475     $ 422.31     09/01/2025              
    01/04/2016                             726     $ 451,376  

                       

(1)

Generally, outstanding SARs granted under the Existing 2015 Plan vest 25% per year over a four-year period from the date of grant (vesting on September 1, 2016, 2017, 2018 and 2019). Replacement Shares cliff-vested on December 12, 2016 (the vesting date of the forfeited awards that they replaced) and, therefore, are not included in this table. Outstanding Staking Shares were granted on July 8, 2015 and are scheduled to cliff-vest on January 2, 2018, and outstanding PSAs granted in 2016 are scheduled to cliff-vest on January 4, 2019.

 

(2)

The Staking Shares and PSAs were subject to performance-based vesting conditions based on the achievement of certain performance goals selected from those specified in the Existing 2015 Plan. The Staking Shares were earned in full and the PSAs granted in 2016 were earned at 200% of target, in each case based on the achievement of applicable performance metrics, but remain subject to service-based vesting requirements. The SARs and the PSAs are described in further detail in the sections entitled Compensation Discussion and Analysis—Elements of Our Compensation Program—Long-Term Annual Equity Incentive” and Narrative Disclosure to Summary Compensation Table—Long-Term Equity Incentive Compensation” above.

 

(3)

Calculated using the closing price of a share of our common stock as reported by the NYSE as of December 30, 2016, the last trading day of 2016 ($621.73).

 

33

 

 

2016 Option Exercises and Stock Vested

 

The following table shows a summary of any SAR exercises and the vesting of restricted stock awards with respect to our NEOs in 2016.

 

Name

 

Number of

Shares Acquired

on Exercise

   

Value Realized on

Exercise

   

Number of

Shares Acquired

on Vesting

   

Value Realized

on Vesting (1)

 

Thomas O. Might

                5,125     $ 3,105,033  

Julia M. Laulis

                1,025     $ 621,007  

Kevin P. Coyle

                       

Stephen A. Fox

                1,025     $ 621,007  

Alan H. Silverman

                216     $ 130,866  

                          

(1)

Calculated using the closing price of a share of our common stock on the vesting date.

 

Retirement Benefits

 

Defined Benefit Pension Plans

 

Our employees, including our NEOs, participate in both tax-qualified and supplemental defined benefit retirement plans. Prior to the spin-off, our NEOs (other than Mr. Coyle) participated in GHC’s tax-qualified defined benefit plan, the Retirement Plan for GHC (the “GHC Retirement Plan”), and the associated nonqualified plan, the GHC Supplemental Executive Retirement Plan (the “GHC SERP”). The GHC Retirement Plan covered most employees of Cable ONE and provided benefits that were based on formulas that take into account base salary and service. Such formulas are contained in the individual benefits schedules for the GHC Retirement Benefits Schedule, Cash Balance Retirement Program (“CBRP”) and the Secure Retirement Account (“SRA”), as explained in further detail below. Benefits under the GHC Retirement Plan become vested after three or five years of service, depending on which schedules cover the individual employee. Upon the spin-off, the accrued benefits of our participating NEOs under the GHC Retirement Plan became vested and remain the obligation of GHC following the spin-off. GHC will continue to administer the plan, including making payments under the plan, with respect to our current and former employees with vested rights thereunder, including our participating NEOs.

 

Our NEOs (other than Mr. Coyle) have each earned a portion of their pension benefits under different benefits schedules of the GHC Retirement Plan. Mr. Might earned his pension benefit under the GHC Retirement Benefits Schedule, the CBRP and the SRA, and Ms. Laulis and Messrs. Fox and Silverman earned their pension benefits under the CBRP and the SRA.

 

Retirement Plan Benefits Under the GHC Retirement Benefits Schedule

 

Benefits payable under this schedule include the following, subject to the limitations on tax-qualified plans mentioned below (in “—DB SERP Benefits):

 

 

An annual pension (payable one-twelfth each month) equal to (a) 1.75% of the average annual salary for the 60-month period producing the highest average; multiplied by (b) years of exempt accrued credited service; reduced by (c) an offset to partially reflect Social Security benefits to the extent funded by GHC. The Social Security offset is calculated by multiplying “covered compensation” by the “offset percentage.” Covered compensation in this context is the average Social Security Taxable Wage Base over the 35-year period prior to the year in which a participant reaches Social Security retirement age. The offset percentage applied to the benefit for Mr. Might was 0.57% (based on his year of birth), multiplied by years of exempt accrued credited service (which was limited up to 30 years, until the plan was amended in 2011 to recognize credited service in excess of 30 years).

 

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An annual Cash Pension Supplement equal to $200 multiplied by years of credited service.

 

 

A temporary pre-age 65 supplement of $250 per month payable until age 65 to employees retiring at or after age 55 with 10 years of vesting service.

 

Vested benefits under the GHC Retirement Plan are generally payable in the form of a single life annuity. In addition, several optional forms are available that continue benefits to the employee’s spouse or beneficiary, with the monthly benefit amount reduced so that the resulting pension is actuarially equivalent to the single life annuity. The GHC Retirement Plan’s normal retirement age is 65. The GHC Retirement Benefits Schedule provides a reduced early retirement benefit beginning at age 55. The reduction is a percentage based on age at retirement. For example, at age 55 with 10 years of service, the reduction is 60%; at age 58, the reduction is 26%. However, if the employee’s age plus years of service at retirement is at least 90, then there is no reduction for early payment.

 

Retirement Plan Benefits Under the Secure Retirement Account and Cash Balance Retirement Program Schedule

 

The CBRP was provided to eligible employees of Cable ONE by GHC prior to the spin-off. Each employee has an account (expressed as a lump sum amount, rather than as an annuity) that is credited with quarterly pay-based credits and interest credits. Pay-based credits vary from 2.25% to 3.75%, depending on years of service. Interest is credited on these accounts at the greater of 1.41% or 1% plus the average interest rate on one-year U.S. Treasury securities. Participants are 100% vested in their benefits after attaining age 65 while actively employed or after completion of three years of vesting service. Upon retirement, the employee may elect various forms of annuities that are actuarially equivalent to the accumulated account balance, or alternatively, may elect a lump sum payment. Vested benefits are payable at any time after termination of employment, but must be paid by age 65 for employees who terminate employment prior to such age.

 

Under the SRA, each employee has an account (expressed as a lump sum amount, rather than as an annuity) that is credited with quarterly pay-based credits and interest credits. Pay-based credits vary from 2.20% to 3.50%, depending on years of service. Interest is credited on these accounts at the greater of 1.41% or 1% plus the average interest rate on one-year U.S. Treasury securities. Upon retirement, the employee may elect various forms of annuities that are actuarially equivalent to the accumulated account balance, or alternatively, may elect a lump sum payment. Vested benefits are payable at any time after termination of employment, but must be paid by age 65 for employees who terminate employment prior to such age.

 

DB SERP Benefits

 

Effective as of the spin-off, we established the defined benefit portion of the Cable ONE SERP (the “Cable ONE DB SERP”) with terms substantially similar to the defined benefit portion of the GHC SERP (the “GHC DB SERP”). The Cable ONE DB SERP, under which we assumed all obligations to current and former Cable ONE employees, including our NEOs, who participated in the GHC DB SERP, is a nonqualified plan that provides key executives who participate in the GHC Retirement Plan with a “supplemental retirement benefit.” Prior to the spin-off, participants in the GHC SERP were selected by GHC’s management as employees whom management most wanted to retain because of their superior performance and were approved for participation by the GHC’s Compensation Committee. The GHC DB SERP provided, and the Cable ONE DB SERP provides, for benefits to such participants, including each of our participating NEOs, that were calculated based on the formulas in the GHC Retirement Plan, but included bonuses under GHC’s 2012 Incentive Compensation Plan, rather than just base salary, without regard to (i) the salary limitation applicable to tax-qualified plans ($265,000 in 2016) or (ii) the benefit limitation applicable to tax-qualified plans ($210,000 per year commencing at age 65 in 2016). The GHC DB SERP provided, and the Cable ONE DB SERP provides, benefits only to the extent that the benefit described above exceeds the benefit in the GHC Retirement Plan. Benefits under the Cable ONE DB SERP are paid at retirement or age 55, if later, and are payable either in the form of a life annuity or an actuarially equivalent optional form of benefit in the GHC Retirement Plan, provided that any benefits otherwise payable before the first day of the seventh month following retirement will be withheld until such date.

 

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Pension Benefits Table

 

The following table shows years of credited service and the present value of accumulated benefits for each NEO (other than Messrs. Coyle and Silverman) under the Cable ONE SERP, computed as of December 31, 2016, which is the same pension plan measurement date used for financial statement reporting purposes with respect to our audited financial statements for the year ended December 31, 2016. Messrs. Coyle and Silverman do not participate in any pension plans sponsored or maintained by Cable ONE.

 

Name

 

Plan Name

 

Number of Years

Credited Service (1)

 

Present Value of

Accumulated Benefit (2)

 

Payments During

Last Fiscal Year

 

Thomas O. Might

 

Cable ONE SERP 

 

39

 

$

4,852,812

 

 

 

Julia M. Laulis

 

Cable ONE SERP 

 

17

 

$

79,256

 

 

 

Stephen A. Fox

 

Cable ONE SERP 

 

28

 

$

75,067

 

 

 

                          

(1)

Data in this column represents the number of years of credited service earned by the NEO as of December 31, 2016. Mr. Might has prior service with the GHC Retirement Benefits Schedule, which is included in this column.

 

(2)

Amounts in this column represent the actuarial present value of the NEO’s accumulated benefits under the plan as of December 31, 2016. The benefits valued for Mr. Might include GHC Retirement Benefits Schedule and CBRP amounts. The benefits valued for Ms. Laulis and Mr. Fox include CBRP amounts. The assumptions used in determining the present value of accumulated benefits are the RP-2016 Fully Generational Mortality Table for males and females and a 3.95% discount rate. The benefits valued reflect service and earnings through the accrual freeze date of June 30, 2015, and are valued as payable on the date at which they are unreduced for the GHC Retirement Benefits Schedule and at age 65 (or later for Mr. Might) for the CBRP. There can be no assurance that the amounts listed in this column will ever be fully paid out to the applicable NEO.

 

Benefits were assumed to commence at the age when benefits under the Cable ONE SERP are first unreduced and were discounted to the date as of which they were determined (either December 31, 2016 or December 31, 2015). Assumed benefit commencement ages are shown below, rounded to the nearest age:

 

Name

 

Age

 

Thomas O. Might

 

66 (12/31/2016); 65 (12/31/2015)

 

Julia M. Laulis

 

65 (12/31/2016 and 12/31/2015)

 

Kevin P. Coyle

 

n/a

 

Stephen A. Fox

 

65 (12/31/2016 and 12/31/2015)

 

Alan H. Silverman

 

n/a

 

 

Defined Contribution Plans

 

The Compensation Committee believes that both the U.S. tax-qualified and supplemental defined contribution plans are integral parts of our overall executive compensation program. Effective as of the spin-off, we established a defined contribution plan intended to be tax-qualified (the “Cable ONE 401(k) Plan”) and following the spin-off, all account balances of current and former Cable ONE employees, including our NEOs (other than Mr. Coyle), held by the Savings Plan for GHC Divisions, which is one of GHC’s qualified defined contribution 401(k) plans (the “GHC 401(k) Plans”), were transferred to the Cable ONE 401(k) Plan. The Cable ONE 401(k) Plan provides for non-discretionary matching contributions up to 5% of an employee’s eligible compensation up to the salary limitation applicable to tax-qualified plans ($265,000 in 2016). Participants are eligible to receive Company matching contributions after one year of service, and participants are immediately vested in the Company matching contributions.

 

Prior to the spin-off, our NEOs (other than Mr. Coyle) participated in the GHC 401(k) Plans, which provided for non-discretionary matching contributions up to 1% of an employee’s eligible compensation up to the salary limitation applicable to tax-qualified plans ($265,000 in 2016). Participants were immediately vested in the Company matching contributions. Benefits under these qualified plans were determined on the basis of base salary only, exclusive of all bonuses, sales commissions, deferred compensation and other forms of remuneration.

 

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In addition, effective as of the spin-off, we established the defined contribution portion of the Cable ONE SERP (the “Cable ONE DC SERP”) with terms substantially similar to the defined contribution portion of the GHC SERP (the “GHC DC SERP”) under which we assumed all obligations to current and former Cable ONE employees who participated in the GHC DC SERP, including our participating NEOs. The GHC DC SERP provided, and the Cable ONE DC SERP provides, such executives with tax-deferred accruals of amounts proportionate to the benefits available to non-highly compensated participants in the applicable 401(k) plans, to the extent that benefits exceed those under the sponsored basic plans because of the tax law limitations ($53,000 in 2016). Among the benefits provided under the GHC DC SERP and Cable ONE DC SERP is a supplemental defined contribution plan benefit wherein we provide a matching contribution percentage up to 3% of the participating executive’s base salary in excess of the annual covered compensation limit applied to qualified plan benefits. The executive was required to defer compensation to the applicable SERP in order to receive the applicable matching Cable ONE credit each year. Deferred amounts will earn investment credits in accordance with the participant’s elections from a choice of investment indexes. Amounts deferred under the Cable ONE DC SERP are payable on the first day of the seventh month following termination of service. No Company contributions were earned by Cable ONE DC SERP participants after July 1, 2015.

 

Deferred Compensation Plans

 

Effective as of the spin-off, we established the Cable ONE Deferred Compensation Plan with terms substantially similar to the GHC Deferred Compensation Plan, under which plan we remain responsible for any obligations to current and former Cable ONE employees who participated in the GHC Deferred Compensation Plan, including our NEOs (other than Messrs. Coyle and Fox).

 

Prior to the spin-off, the GHC Deferred Compensation Plan provided an opportunity for participants, including our NEOs (other than Mr. Coyle), to voluntarily defer the receipt of all or a portion of annual bonus and/or certain long-term cash awards under GHC’s 2012 Incentive Compensation Plan. Elections to defer must have been filed in advance of earning such awards. Deferred amounts will earn investment credits in accordance with the participant’s elections from a choice of investment indexes. Amounts deferred under the Cable ONE Deferred Compensation Plan are payable on the first business day of the seventh month following the date of separation from service or such other future date as specified by the participant at the time of election. Effective for deferral elections made on or after January 1, 2014, amounts deferred under the Cable ONE Deferred Compensation Plan are payable on the first business day of the seventh month following the date of separation of service regardless of the participant’s elections. No deferrals are permitted under the Cable ONE Deferred Compensation Plan after December 31, 2015.

 

Additionally, in 1999, Mr. Might was granted a special deferred compensation award by GHC in recognition of his efforts in growing our Company. Annual payouts under this arrangement will commence when Mr. Might separates service with our Company. The base amounts began accruing interest on May 1, 2016 at an annual rate corresponding to the applicable rate for 12-month U.S. Treasury bills (set at each anniversary and carried forward), credited and compounded on an annual basis. The award may be payable in installments upon mutual agreement of Mr. Might and us, not to extend beyond a 10-year period; however, in the event of Mr. Might’s death, all amounts due will be payable in a lump sum within 60 days. No amounts were paid to Mr. Might in 2016, 2015 or 2014 in respect of this arrangement.

 

Nonqualified Deferred Compensation Table

 

The following table shows quantitative information regarding our NEOs’ participation in the deferred compensation arrangements discussed above for 2016.

 

Name

 

Deferred

Compensation

Arrangement

 

Executive

Contributions

in 2016

   

Registrant

Contributions

in 2016

   

Aggregate

Earnings in

2016 (1)

   

Aggregate

Withdrawals / Distributions

   

Aggregate

Balance at

December 31,

2016 (2)

 

Thomas O. Might

 

Cable ONE SERP

              $ 8,590           $ 1,346,774  
   

Cable ONE Deferred Compensation Plan

              $ 44,384           $ 12,025,322  
   

Special Deferred Compensation Award

              $ 32,262           $ 2,007,345  

Julia M. Laulis

 

Cable ONE SERP

              $ 2,996           $ 39,484  
   

Cable ONE Deferred Compensation Plan

              $ 3,901     $ (23,473 )   $ 83,789  

Stephen A. Fox

 

Cable ONE SERP

              $ 1,022           $ 15,721  

Alan H. Silverman

 

Cable ONE Deferred Compensation Plan

              $ 14,329           $ 191,367  

                        

(1)

Amounts in this column represent investment gains or losses to the Cable ONE SERP or to the Cable ONE Deferred Compensation Plan, as applicable, based on the NEO’s investment