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 (Amendment No.          )

CROWN MEDIA HOLDINGS, INC.
12700 Ventura Boulevard
Suite 200
Studio City, California 91604

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
June 26, 2013

To the Stockholders of Crown Media Holdings, Inc.:

        We will hold the annual meeting of stockholders (the "Annual Meeting") of Crown Media Holdings, Inc. ("Crown Media Holdings" or the "Company") at the offices of the Company located at 12700 Ventura Boulevard, Suite 200, Studio City, California 91604, on June 26, 2013, at 12:30 p.m., Pacific Time.

        The purpose of the meeting is to:

1.

Elect our 14 board nominees to the Company's board of directors (the "Board");



2.

Approve our Chief Executive Officer's and Other Executive Officers' Performance-Based Compensation for IRS Section 162(m) purposes; and



3.

Consider any other matters that properly come before the meeting and any adjournments thereof.

        Information concerning the matters to be acted upon at the Annual Meeting is set forth in our Proxy Statement.

        Only stockholders of record of Class A Common Stock at the close of business on May 6, 2013 (the "Record Date") are entitled to receive notice of and to vote at the meeting. A list of the stockholders entitled to vote will be available for examination at the meeting by any stockholder for any purpose relevant to the meeting. The list will also be available on the same basis for ten days prior to the Annual Meeting at our principal executive office, 12700 Ventura Boulevard, Suite 200, Studio City, California 91604.

Important Notice Regarding the Availability of Proxy Materials
for the Annual Meeting to be held on June 26, 2013:
The Company's Proxy Statement and Annual Report on Form 10-K are available at
www.hallmarkchannel.com/2013annualmeeting.html

        We have elected to furnish our proxy materials over the Internet. On or about May 16, 2013, we are sending our stockholders a Notice of Internet Availability of Proxy Materials (the "Notice") instead of a paper copy of our Proxy Statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2012. The Notice contains instructions on how to access and review those documents over the Internet. We anticipate that the Proxy Statement will first be available to stockholders of the Company at our website on or about April 30, 2013. The Notice also instructs you on how to submit your proxy over the Internet. We believe that this process allows us to provide you with the information you need in a more timely manner, while reducing the environmental impact and lowering the costs of printing and distributing our proxy materials. If you would like to receive a printed copy of our proxy materials, you should request such materials no later than June 12, 2013 from the Company's Executive Vice President, Legal and Business Affairs, and General Counsel of the Company at Crown Media Holdings, Inc., 12700 Ventura Boulevard, Suite 200, Studio City, California 91604.

April 30, 2013

PLEASE VOTE. YOUR VOTE IS IMPORTANT.

CROWN MEDIA HOLDINGS, INC.
12700 Ventura Boulevard
Suite 200
Studio City, California 91604

PROXY STATEMENT
For
ANNUAL MEETING OF STOCKHOLDERS
To Be Held On June 26, 2013

        The Board is soliciting proxies (the "Proxies") for use at the Annual Meeting to be held on June 26, 2013 at 12:30 p.m., Pacific Time at offices of the Company located at 12700 Ventura Boulevard, Suite 200, Studio City, California 91604 or at any postponements or adjournments of the Annual Meeting. We anticipate that this Proxy Statement will first be available to stockholders of the Company at our website on or about April 30, 2013.

SOLICITATION OF PROXIES

Voting by Telephone or Internet

        Stockholders of record entitled to vote at the Annual Meeting can simplify their voting and reduce the Company's cost by voting their shares via telephone or the Internet. The telephone and Internet voting procedures are designed to authenticate stockholders' identities, allow stockholders to vote their shares and to confirm that their instructions have been properly recorded. If a stockholder's shares are held in the name of a bank or broker, the availability of telephone and Internet voting will depend on the processes of the bank or broker; therefore, stockholders should follow the voting instructions on the form they receive from their bank or broker.

        Stockholders who elect to vote over the Internet may incur costs such as telecommunication and Internet access charges for which the stockholder is solely responsible. The telephone and Internet voting facilities for stockholders of record will close at 11:59 p.m. Pacific Time on June 25, 2013.

Voting by Mail

        You can only vote by mail if you request and receive a paper copy of the proxy materials and proxy card. The Notice provides instructions on how to do this and you should make your request by June 12, 2013. You then vote by completing, signing, dating, and returning a proxy card. The proxy card must be received by the close of business on June 25, 2013. The shares represented will be voted in accordance with the directions in the proxy card.

Stockholders Entitled to Vote

        Stockholders of record as of the close of business on May 6, 2013, the Record Date, are entitled to vote at the Annual Meeting. As of the date of this Proxy Statement, 359,675,936 shares of the Company's Class A common stock, par value $0.01 (the "Class A Common Stock") are issued and outstanding. Each share of Class A Common Stock is entitled to one vote and will vote together as a single class. You may not cumulate votes.

Revocation of Proxies

        You may revoke your proxy at any time before it is exercised by (i) providing written notice of revocation to the Company Secretary, (ii) timely delivery of a later dated proxy (including an Internet or telephone vote), or (iii) attending the Annual Meeting and voting in person.

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Quorum; Required Vote

        A majority of the voting power of the outstanding shares entitled to vote generally in the election of directors, represented in person or by proxy, will constitute a quorum. Any stockholder that has properly submitted a proxy will be considered part of the quorum.

        Votes that are withheld and abstentions are deemed as present at the annual meeting, are counted for quorum purposes and, except for voting on directors, will have the same effect as a vote against a matter. Broker non-votes, while counted for general quorum purposes, are not deemed to be present and will have no effect with respect to any matter for which a broker does not have authority to vote. A broker non-vote occurs when a broker submits a proxy but chooses not to vote the shares on a "discretionary" matter or is not permitted to vote on "non-discretionary" matters in cases in which the beneficial owner has not instructed the broker how to vote. All matters being presented in this Proxy Statement are considered "non-discretionary."

        The required vote for Proposal 1 is a plurality of the votes cast, with the 14 nominees receiving the highest number of votes cast elected to the Board. The required vote for Proposal 2 is the affirmative vote of a majority of the shares present or represented by proxy and entitled to vote at the Annual Meeting, voting as a single class.

Solicitation Costs

        The Company will bear the cost of soliciting proxies. The Company hired Computershare, Inc. to assist in the solicitation of proxies at a cost of approximately $5,000 plus out-of-pocket expenses. The Company will reimburse brokerage firms and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to the owners of Class A Common Stock. In addition to using the mails, the Company's officers, employees or agents may also solicit proxies in person or by telephone, facsimile or by other means of electronic communication, but they will not be specifically compensated for such services.

Annual Report on Form 10-K

        Stockholders may receive a copy of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012 by contacting the Executive Vice President, Legal and Business Affairs, and General Counsel of the Company at Crown Media Holdings, Inc., 12700 Ventura Boulevard, Suite 200, Studio City, California 91604 or by visiting www.hallmarkchannel.com/2013annualmeeting.html.

Stockholders Sharing the Same Address

        The Company has adopted a procedure approved by the SEC called "householding." Under this procedure, stockholders of record who have the same address and last name will receive only one copy of our Notice of Internet Availability until such time as one or more of these stockholders notifies us that they want to receive a separate Notice of Internet Availability. This procedure reduces our printing costs and postage fees. Stockholders who participate in householding will continue to have access to and may utilize separate proxy voting instructions.

        If you receive a single Notice of Internet Availability as a result of householding and you would like to receive a separate copy, please submit a request to our Executive Vice President, Legal and Business Affairs, and General Counsel at Crown Media Holdings, Inc., 12700 Ventura Boulevard, Suite 200, Studio City, California 91604, and we will promptly send the notice to you. You may also contact the Company's Executive Vice President, Legal and Business Affairs, and General Counsel at the address and phone number above if you receive multiple copies of the Notice of Internet Availability and you would prefer to receive a single copy in the future, or if you would like to opt out of householding for future mailings. Beneficial owners can request information about householding from their bank, broker, or other nominee.

PLEASE VOTE. YOUR VOTE IS IMPORTANT.

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PROPOSAL 1
ELECTION OF DIRECTORS

        Nominations to our Board are governed by our bylaws. Our Board currently has 15 member positions. As of the date of this Proxy Statement, there is one vacancy on the Board. At the Annual Meeting, stockholders will vote for the election of 14 directors, the nominees for which are listed below. All nominees are currently members of our Board and were nominated for election by the Board. The nominees' terms, if elected, will continue until the next annual meeting of stockholders or until their successors are duly elected and qualified. Each of the nominees has consented to serve on our Board. If any nominee is unable to serve as a director, the current Board may designate a substitute nominee and the proxies will vote all valid proxy cards for the election of the substitute nominee. In accordance with our bylaws, no other nominees by stockholders for directors (except any nomination by or at the direction of the Board) will be proper at the Annual Meeting. Proxies solicited by the Board will not be voted for more than 14 nominees for the Board.

        Because Hallmark Cards, Incorporated ("Hallmark Cards") holds approximately 90.3% of Class A Common Stock, through its subsidiaries H C Crown, LLC ("HCC"), a Delaware limited liability company, and Hallmark Cards GmbH, a German entity ("HC Germany"), its vote in favor of the nominees will be sufficient to elect these nominees regardless of the vote of any other stockholders.

BOARD OF DIRECTORS

Board Nominees

        William J. Abbott, age 51, has been President and Chief Executive Officer and a director of Crown Media Holdings since June 1, 2009. Prior to that, Mr. Abbott was Executive Vice President, Advertising Sales, of Crown Media Holdings since January 2000. Prior to that, he was Senior Vice President, Advertising Sales, of Fox Family Worldwide from January 1997 to January 2000. Mr. Abbott was selected as a director nominee because he is the President and Chief Executive Officer of the Company and because of his extensive experience in the television industry and advertising sales.

        Dwight C. Arn, age 62, has been a director of Crown Media Holdings since March 2008. Mr. Arn has been Associate General Counsel of Hallmark Cards, the Company's parent company, since 1989. Additionally, Mr. Arn has been serving as General Counsel of Hallmark International since 1992 and as General Counsel of Crayola LLC since 1995. Mr. Arn began his career at Hallmark Cards in 1976 and has served in various attorney positions. Mr. Arn was selected as a director nominee because of his business and legal experience.

        Robert C. Bloss, age 57, has been a director of Crown Media Holdings since July 2009. Mr. Bloss has been Senior Vice President—Human Resources of Hallmark Cards since March 2008. He was human resources director for the Hallmark Cards retail business from 2005 to 2008. Mr. Bloss has been human resources director for various divisions of Hallmark Cards since 1986, including the product development and marketing divisions. Mr. Bloss is the chairman of the Compensation Committee. Mr. Bloss was selected as a director nominee because of his experience in the areas of human resources and executive compensation.

        William Cella, age 63, has been a director of Crown Media Holdings since March 2008. Mr. Cella is the Chairman and Chief Executive Officer of The Cella Group, a media sales representation company. Before forming The Cella Group in 2008, Mr. Cella led MAGNA Global, a Media Negotiation, Research and Programming Unit of the Interpublic Group of Companies. From 1997 through 2001, Mr. Cella served as Executive Vice President and Director of Broadcast and Programming for Universal McCann North America. From 1994 through 1997, Mr. Cella served as Director of National Broadcast and Programming for McCann-Erickson and, in 1997, was named Executive Vice President of McCann-Erickson for all of North America. Mr. Cella currently serves as

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a member of the Company's Nominating Committee. Mr. Cella was selected as a director nominee because of his extensive experience with media and advertising.

        Glenn Curtis, age 54, has been a director of Crown Media Holdings since January 2005. He has been President of Starz, LLC since February 2012. Prior to that, he was Executive Vice President and Chief Financial Officer of Starz LLC from August 2006 to February 2012. Prior to that, he was Vice President of Liberty Media Corporation (a holding company with interests in electronic retailing, media, communications, and entertainment industries) from 2003 to August 2006. Prior to that, he was Executive Vice President and Chief Financial Officer of Starz Entertainment Group (a subsidiary of Liberty Media Corporation providing premium movie networks on television) from 1995 to 2002. Mr. Curtis was selected as a director nominee because of his extensive experience in cable and entertainment companies.

        Steve Doyal, age 64, has been a director of Crown Media Holdings since December 2007. Mr. Doyal has been Senior Vice President of Public Affairs and Communications since 1994 and a corporate officer at Hallmark Cards since 1995. In this position, he oversees the operations of the Hallmark's communications programs, including internal communications and publications, audio-visual communications, media relations, government affairs, and the Hallmark Visitors Center. Prior to that, he served as Media Relations Director from 1993 to 1994 and as Corporate Media Relations Manager from 1988 to 1993. Mr. Doyal was selected as a director nominee because of his experience in communications and media management.

        Brian E. Gardner, age 60, has been a director and Secretary of Crown Media Holdings since January 2004. He has been Executive Vice President and General Counsel of Hallmark Cards since December 2003. From 1996 to 2003, Mr. Gardner was a Managing Partner of Stinson Morrison Hecker, LLP (formerly known as Morrison & Hecker, LLP). Mr. Gardner currently serves as a member of the Company's Nominating Committee. Mr. Gardner was selected as a director nominee because of his business, management and legal experience.

        Herbert A. Granath, age 84, is a Co-Chairman of the Board and has been a director of Crown Media Holdings since December 2004. He has been a consultant for Telenet since 2000 and a consultant for Accenture since 2006. He has also been a director of Central European Media Enterprises Ltd. (Nasdaq GS: CETV) since 2001. Mr. Granath was the Chairman of Disney/ABC International Television from 1995 to 2000. Mr. Granath currently serves as a member of the Company's Audit and Compensation Committees. Mr. Granath was selected as a director nominee because of his extensive business experience, in particular in the television industry.

        Timothy Griffith, age 62, has been a director of Crown Media Holdings since June 2012. Mr. Griffith has been Executive Vice President and Chief Financial Officer of Hallmark Cards since December of 2007. He has been in the finance division for Hallmark Cards since joining the company in 1978. In his time with Hallmark, Mr. Griffith has served in a director or manager in a variety of finance areas. He is currently a member of the Compensation Committee of Hallmark. He also serves on the Board of a Kansas City area not-for-profit, Southwest Boulevard Family Health Care. Mr. Griffith was selected as a director nominee because of his extensive business and financial experience.

        Donald J. Hall, Jr., age 57, is a Co-Chairman of the Board and has been a director of Crown Media Holdings since May 2000. Mr. Hall has been the President and Chief Executive Officer of Hallmark Cards since January 2002 and a member of the board of directors of Hallmark Cards since 1996. Mr. Hall has served in a variety of positions for Hallmark Cards since 1971. Mr. Hall was the Executive Vice President, Strategy and Development from September 1999 until December 2001. Prior to that, Mr. Hall was the Vice President, Product Development, of Hallmark Cards from September 1996 until August 1999. Mr. Hall was selected as a director nominee because of his extensive business and management experience.

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        A. Drue Jennings, age 66, has been a director of Crown Media Holdings since June 2006. He has been of Counsel at the law firm of Polsinelli Shughart (formerly known as Shughart, Thomson & Kilroy, P.C.) since October 2004. Mr. Jennings was the interim Athletic Director at the University of Kansas from April 2003 until July 2003. Prior to that, Mr. Jennings was the Chief Executive Officer of Kansas City Power & Light Company from 1988 to 2000 and Chairman of the Board of Kansas City Power & Light Company from 1990 to 2001. Mr. Jennings currently serves as the chairman of the Company's Audit Committee and as a member of the Compensation Committee. Mr. Jennings was selected as a director nominee because of his business experience, financial expertise and his ability to lead the Audit Committee.

        Peter A. Lund, age 72, has been a director of Crown Media Holdings since May 2000. He is the former President and Chief Executive Officer of CBS Inc. and President and Chief executive Officer of CBS Television and Cable. Additionally, Mr. Lund held numerous positions including President of CBS Broadcasting Group, President of CBS Sports, President of CBS Television Stations and President of CBS Television Network. Mr. Lund has served as a director and a member of the Compensation Committee and Audit Committee of DIRECTV and The DIRECTV Group, Inc. (DIRECTV became publicly held in November 2009 at which time The DIRECTV Group, Inc. became a wholly-owned subsidiary of DIRECTV). Mr. Lund also serves as a director of Emmis Communications Corporation (NasdaqGS: EMMS). Mr. Lund currently serves as the chairman of the Company's Nominating Committee and as a member of the Company's Audit Committee. Mr. Lund was selected as a director nominee because of his extensive experience in the television and cable industry.

        Brad R. Moore, age 66, has been a director of Crown Media Holdings since March 2008. Mr. Moore has been President of Hallmark Hall of Fame Productions since 1993 and Hallmark Publishing from 2007 to 2009, both of which are wholly-owned subsidiaries of Hallmark Cards. Prior to that, Mr. Moore led the development, production and distribution of the Hallmark Hall of Fame series since 1983. Mr. Moore directed Hallmark Cards' U.S. advertising efforts from 1982 to 1998. Mr. Moore was selected as a director nominee because of his knowledge of Hallmark television programming and his familiarity with the Hallmark brand.

        Deanne R. Stedem, age 50, has been a director of Crown Media Holdings since March 2003. She has been Associate General Counsel for Hallmark Cards since 1998, managing legal matters for the various entertainment divisions of Hallmark Cards. She served as Senior Attorney for Hallmark Cards from 1989 until 1998. Ms. Stedem currently serves as a member of the Company's Compensation Committee. Ms. Stedem was selected as a director nominee because of her experience in managing entertainment legal matters for divisions of Hallmark Cards.

Executive Officers

        The following lists our executive officers as of the date of this Proxy Statement and information regarding their principal occupations during at least the last five years.

        William J. Abbott, please see information above under "Directors".

        Edward Georger, age 47, has been Executive Vice President, Advertising Sales, and General Manager of Hallmark Movie Channel since January 2011. Prior to that, Mr. Georger was Executive Vice President of Advertising Sales from June 2009 to January 2011 and Senior Vice President, Advertising Sales from February 2000 to June 2009. Prior to joining the Company, Mr. Georger was Vice President of Eastern Sales, for Family Channel and Fox Family Channel.

        Annie Howell, age 48, has been Executive Vice President of Corporate Communications and Media Relations since January 2012. Prior to that, she was Senior Vice President of Corporate Communications and Media Relations from October 2010 to January 2012. Prior to joining the Company, from July 2007 to March 2010, Ms. Howell served as the Senior Vice President of

5

Communications & Public Affairs at Planet Green and TreeHugger.com, Discovery Communications' global cross-platform initiative and channel devoted to the environment. From Sept 2001 to July 2007, Ms. Howell was Senior Vice President, Communications of Discovery Communications' U.S. Networks division.

        Laura Lee, age 39, has been Executive Vice President of Distribution since March 2013. Prior to that, she was Senior Vice President of Distribution from 2005 to March 2013. Prior to joining the Company, Ms. Lee served as the regional manager of affiliate sales for E! Entertainment Television.

        Susanne McAvoy, age 42, has been Executive Vice President, Marketing since January 2011. Prior to that, Ms. McAvoy was Senior Vice President, Marketing from August 2009 to January 2011 and Vice President, Ad Sales Marketing from November 2007 to August 2009. Prior to joining the Company, Ms. McAvoy was an Ad Sales Marketing Consultant for Bravo and Director of Ad Sales Corporate Marketing for Comcast Spotlight.

        Andrew Rooke, age 50, has been Executive Vice President and Chief Financial Officer since March 2011. Prior to joining the Company, Mr. Rooke held various positions with Fox Entertainment and its affiliates. Most recently, Mr. Rooke was Chief Financial Officer of Twentieth Television from 2007 to 2010. Prior to that, he served as Vice President of Finance of MySpace.com and Fox Interactive Media from 2005 to 2007 and Vice President of Corporate Audit of Fox Entertainment Group from 2003 through 2005. Prior to joining Fox Entertainment, Mr. Rooke served as Vice President of Finance at Warner Bros.

        Charles L. Stanford, age 67, has been Executive Vice President, Legal and Business Affairs and General Counsel since May 2001. Prior to that, he was Senior Vice President, Business Affairs and General Counsel from October 2000 to May 2001. He also served as Senior Vice President, Legal and Business Affairs of Crown Media International from November 1999 through October 2000. Prior to joining the Company, Mr. Stanford held various positions with ABC, Inc., Capital Cities/ABC and The Walt Disney Company from 1976 through 1999.

        Michelle Vicary, age 51, has been Executive Vice President, Programming, since January 2011. Prior to that, Ms. Vicary was Senior Vice President, Scheduling & Acquisitions, Programming, from July 2006 to January 2011 and Vice President, Program Scheduling & Administration from June 2003 to July 2006.

        There are no family relationships among the executive officers or directors of the Company.

THE BOARD RECOMMENDS THAT YOU VOTE "FOR" THESE NOMINEES

THE BOARD OF DIRECTORS

Structure

        Our Board consists of 15 directors, including one vacancy as of the date of this Proxy Statement. Directors are elected annually. Our Board has a standing Audit Committee, Compensation Committee and Nominating Committee. The membership, duties and responsibilities of each of these committees are described below. The committee charters for the Audit and Compensation Committees are available at www.hallmarkchannel.com under "Investor Relations."

Board Leadership Structure and Role in Risk Oversight

        Our Board has two non-executive Co-Chairmen: Donald J. Hall, Jr. and Herbert A. Granath. Mr. Hall was selected to serve in such capacity for the depth of his knowledge of the Company and the Hallmark brand, which brand is a significant element in the Company's business. Mr. Granath was elected to serve in such capacity for the breadth of his experience in the television and entertainment

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industry and his independence without any relationship with the Company, except as a director of the Company.

        The Board has delegated to the Audit Committee the duty of assessing various types of risks which the Company may encounter and developing plans to address risks that materialize. Under the guidance of the Audit Committee, the Company established "Crown Media Ethics Compliance Hotline", which is administered by The Network, a company which renders ethics hotline and cash management services. The Network is independent of the Company and Hallmark Cards and provides a means of anonymously reporting auditing, financial, ethical or other issues which an employee, director or stockholder may feel need to be brought to the Board's attention. Any reports received through The Network are distributed to the Audit Committee. The Company regularly informs its employees and directors the phone number and purpose of this hotline through internal communications and to its stockholders through annual proxy statements.

Committees

Audit Committee

        In 2012, the Audit Committee held four meetings and acted by unanimous written consent on one occasion. The members of the Audit Committee are Messrs. Jennings (who serves as Chairman), Granath and Lund, each of whom is an independent director as defined in Rule 5605 of the listing standards for the Nasdaq Global Market ("Nasdaq Listing Standards"). The Board has determined that each of the members of the Audit Committee is financially literate in accordance with the Nasdaq Listing Standards. The Board has also determined that Mr. Jennings qualifies as an audit committee financial expert, as defined under Securities and Exchange Commission (the "Commission") rules.

        Under the Audit Committee Charter, the primary authority and responsibilities of the Audit Committee are to:

•

oversee the Company's financial reporting processes;



•

provide oversight relating to the Company's internal control over financial reporting and internal audit process and activities;



•

review and approve related party transactions;



•

prepare the report required by the Commission to be included in the Company's annual proxy statement;



•

be directly responsible for the appointment, compensation, retention, termination and oversight of the work of the independent auditors and ensure compliance with independence requirements for auditors;



•

pre-approve all audit and non-audit services; and



•

establish and oversee the Company's whistleblower policy regarding submission of reports of questionable accounting practices, internal accounting controls or auditing matters and the investigation, disposition and retention of such reports.

Compensation Committee

        In 2012, the Compensation Committee held two meetings and acted by unanimous written consent on five occasions. The members of the Compensation Committee are Messrs. Robert Bloss (who serves as Chairman), Jennings, Granath and Ms. Stedem. None of the members of the Compensation Committee are employees of the Company; however, only Messrs. Jennings and Granath are independent based on the NASDAQ listing standards. See "Compensation Committee Interlocks and Insider Participation".

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        The Compensation Committee has the power and authority of the Board to perform the following duties and to fulfill the following responsibilities:

•

review and approve employment agreements or extensions proposed for the CEO and direct reports of the CEO;



•

provide regular oversight of material terms of any employment agreements of these persons;



•

review and approve base salary increase recommendations for CEO and direct reports of the CEO;



•

review and approve annual bonus metrics, targets and awards for these persons;



•

review and approve long-term incentive plan metrics, targets and awards for these persons;



•

review and recommend to the Board any material employee compensation plan;



•

review and approve any proposed grants or awards under a material employee compensation plan, and exercise such other power and authority as may be permitted or required under such plans;



•

produce an annual report on executive compensation for inclusion in the Company's proxy statement;



•

review and approve any compensation to members of the Board;



•

review annually the status of the management talent pool and development plans for key individuals;



•

provide regular oversight of all severance agreements; and



•

perform such other duties as may be delegated to it by the Board from time to time.

        The Compensation Committee also has sole authority to engage and terminate compensation consultants. The Compensation Committee may delegate its authority to subcommittees.

Nominating Committee

        In 2012, the Nominating Committee met once. The Nominating Committee does not have a charter. The members of the Nominating Committee are Messrs. Lund (who serves as Chairman), Gardner and Cella; and Messrs. Lund and Cella are independent directors as defined in the Nasdaq Listing Standards. The Nominating Committee's functions are to consider candidates to serve as members of the Board and to nominate qualified persons for election at the annual meeting of stockholders.

        The Nominating Committee identifies director candidates primarily by considering recommendations made by directors and management. The Nominating Committee may also retain third parties to identify and evaluate director candidates, but did not retain any such third parties during 2012. When evaluating director candidates, the Nominating Committee considers a number of factors, such as the candidate's background, skills, judgment, diversity and experience with companies of comparable business and size. The Nominating Committee also considers the candidate's experience in relation to the experience of other Board members, the candidate's independence or lack of independence (as determined in accordance with the Nasdaq Listing Standards), and the candidate's qualifications for committee membership. The Nominating Committee does not assign any particular weight or priority to any of these factors and considers each director candidate in the context of the current needs of the Board as a whole.

        The Nominating Committee will consider nominees recommended by stockholders who follow the procedures set forth in the Company's bylaws. For more information, see "Submission of Stockholder

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Proposals" below. Director candidates recommended by stockholders are evaluated in the same manner as candidates recommended by a Board member, management or a third party. Therefore, the Board has not deemed it necessary to adopt a policy regarding consideration of candidates recommended by stockholders.

        The Nominating Committee recommended that the Board nominate all directors listed above under Proposal 1 for reelection at the 2013 Annual Meeting.

Board Meetings

        In 2012, the Board held four meetings and acted by unanimous written consent on four occasions. All members of the Board attended at least 75% of the aggregate of the total number of Board meetings and the total number of meetings held by all committees on which such director served during 2012.

Compensation Committee Interlocks and Insider Participation

        During 2012, none of our current or former executive officers or employees served on the Company's Compensation Committee. During 2012, no interlocking relationship existed between any member of the Company's Compensation Committee and any member of the compensation committee of any other company, nor has any such interlocking relationship existed in the past.

CORPORATE GOVERNANCE

Director Independence

        Based on the Nasdaq Listing Standards, the Board has determined that the following directors are independent and have no relationship with the Company, except as directors of the Company: William Cella, Glenn Curtis, Herbert A. Granath, A. Drue Jennings and Peter A. Lund.

        Also based on the Nasdaq Listing Standards, the Board has determined that the following directors and director nominee are not independent because they are employees of Hallmark Cards, the Company's parent company: Dwight C. Arn, Robert C. Bloss, Steve Doyal, Brian E. Gardner, Timothy Griffith, Donald J. Hall, Jr., Brad R. Moore and Deanne R. Stedem. Furthermore, the Board has determined that William Abbott is not independent because he is the President and Chief Executive Officer of the Company.

Audit Committee

        Based on the Nasdaq Listing Standards, the Board has determined that all members of the Audit Committee are independent.

Compensation Committee

        Based on the Nasdaq Listing Standards, the Board has determined that Robert C. Bloss and Deanne R. Stedem are not independent for the reasons stated above. The other members of the Compensation Committee, Herbert Granath and A. Drue Jennings, are independent.

Nominating Committee

        Based on the Nasdaq Listing Standards, the Board determined that Brian E. Gardner is not independent for the reason stated above. Other members of the Nominating Committee, William Cella and Peter Lund, are independent.

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Controlled-Company Exemption

        Hallmark Cards holds approximately 90.3% of Class A Common Stock through its subsidiaries HCC and HC Germany. Therefore, notwithstanding the disclosures made herein under "Director Independence", the Board has determined that the Company is a "controlled company", as that term is defined under the Nasdaq Listing Standards. Consequently, the Company is exempt from independent director requirements of the Nasdaq Listing Standards, including the requirement that the Company's compensation and nominating and governance committees be composed of independent directors, except for the requirements pertaining to the composition of the audit committee and the executive sessions of independent directors, with which the Company has complied.

Code of Business Conduct and Ethics

        The Company has adopted a Code of Business Conduct and Ethics that reflects long-standing positions of the Company. The Code applies to all employees, including the Company's principal executive officer, principal financial officer and controller, and directors. A stockholder can request a free copy of the Code of Business Conduct and Ethics by writing to the Executive Vice President, Legal and Business Affairs and General Counsel of the Company at Crown Media Holdings, Inc., 12700 Ventura Boulevard, Suite 200, Studio City, California 91604. A copy of the Code of Business Conduct and Ethics Policy is also available at www.hallmarkchannel.com under "Investor Relations."

Stockholder Communications with the Board

        Any stockholder who wishes to contact a member of the Board of the Company may do so by sending an email to "directors@hallmarkchannel.com". Alternatively, a stockholder may contact directors by writing to the following address: Board of Directors, c/o Corporate Secretary, Crown Media Holdings, Inc., 12700 Ventura Boulevard, Studio 200, Studio City, California 91604. Communications received electronically or in writing will be distributed to the Chairmen of the Board or the other members of the Board as appropriate depending on the facts and circumstances outlined in the communication received. For example, if any complaints regarding accounting, internal accounting controls and auditing matters are received, the Corporate Secretary will forward them to the Chairman of the Audit Committee for review.

        As an alternative, any stockholder can contact a member of our Board through "Crown Media Ethics Compliance Hotline." This hotline is administered by The Network, a company independent of the Company and Hallmark Cards, and provides a means of anonymously reporting auditing, financial, ethical or other issues which the stockholder may feel need to be brought to the Board's attention. Any reports received through The Network will be distributed to the Company's Audit Committee. The hotline number is 1-800-536-6751.

        While the Company has no policy on directors attending the annual meeting, members of the Board are encouraged to attend the annual meetings of the Company's stockholders. All of our directors attended the 2012 Annual Meeting of Stockholders of the Company.

DIRECTOR COMPENSATION

        We do not compensate directors who are employees of the Company or Hallmark Cards or their respective subsidiaries for serving on the Board or any of its committees. All directors who are not employees of the Company or Hallmark Cards or their respective subsidiaries ("non-employee directors") are compensated as follows: (1) annual retainer of $45,000 and $1,000 per meeting for each extraordinary meeting or meeting in excess of the number of regularly scheduled meetings of four per year; (2) additional annual retainer of $45,000 for Co-Chairman of the Board; (3) annual grant of non-equity long term incentive plan awards ("LTIP Awards") valued at $50,000; (4) for chairman of the

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Audit Committee, an annual retainer of $10,000; and (5) for chairman of each committee other than the Audit Committee, an annual retainer of $5,000.

        Until 2012, the non-employee directors were granted restricted stock units ("RSUs") instead of LTIP Awards. Subject to continued membership on the Board as of each anniversary date of grant date, the RSUs vest in equal one-third installments on each of the first, second and third anniversaries of the grant date. Each RSU represents the right to receive one share of the Company's Class A Common Stock or, in the discretion of the Compensation Committee, the cash equivalent to the fair market value of one share of the Company's Class A Common Stock (calculated by taking the average of the stock price for the immediately preceding 14 business days). Any outstanding unvested RSUs will vest immediately upon a director's termination of membership on the Board by reason of death, disability or involuntary termination without cause upon a change in control.

        LTIP Awards are similar in nature to those granted to executives of the Company as described below under "Compensation Discussion & Analysis". Generally, LTIP Awards vest in one lump sum three years after the grant date, subject to continued membership on the Board at the time of vesting and achievement of the same Company performance metrics which are applicable to the LTIP Awards granted to the executives of the Company. Vested LTIP Awards will be settled in cash within the later of (1) 30 days after the vesting date or (2) 15 days after the Company issues its audited financials for the year in which the awards vested, but in any event no later than March 15 of the year following the year in which the awards vested. Any outstanding unvested LTIP Award will immediately expire if the directorship is terminated at any time prior to the first anniversary date of the grant. If membership on the Board terminates by reason of death or disability, a pro rata portion of any outstanding LTIP Award will vest. In 2012, in addition to the annual grant of $50,000, the Company granted $20,000 of LTIP Awards as a transitional grant, which will vest in one lump sum in August 2013, subject to vesting criteria. Such transitional grant was necessary to compensate for the shortfall of annual compensation to be received in 2013 created by transitioning from granting of RSUs to LTIP Awards.

        All directors receive reimbursement of expenses incurred in connection with participation in Board meetings.

        The table below summarizes the compensation paid by the Company to its directors who are not employees of the Company or Hallmark Cards or its subsidiaries for the fiscal year ended in December 31, 2012:

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PROPOSAL 2
APPROVAL OF CHIEF EXECUTIVE OFFICER'S AND
CERTAIN OTHER EXECUTIVE OFFICERS'
PERFORMANCE-BASED COMPENSATION FOR IRS SECTION 162(m) PURPOSES

General

        We have employment agreements and long term incentive cash award agreements (as described under Compensation Discussion & Analysis below, the "LTIP Agreements") with our Chief Executive Officer and other executive officers that contain provisions for Performance Awards and Performance Bonuses (collectively referred to as "Performance-Based Compensation" and defined below). The Performance-Based Compensation, together with other compensation, for each executive officer could exceed $1,000,000 in any year. As a public corporation subject to Internal Revenue Code Section 162(m), we are generally unable under the Internal Revenue Code to deduct compensation over $1,000,000 paid in any fiscal year to our chief executive officer and certain other executive officers, except for qualifying performance-based compensation and certain other types of compensation. One of the conditions to qualify performance-based compensation as exempt from the deduction limitation is stockholder approval of the material terms of such compensation. We are seeking stockholder approval of the Performance-Based Compensation to the Covered Executives (defined below).

Performance Awards under 2012 LTIP

        The Company has the 2012 Crown Media Holdings, Inc. Long-Term Incentive Plan (the "2012 LTIP") in place, under which the Compensation Committee has the discretion to grant long-term incentive awards to our employees. Under the 2012 LTIP, certain key executives of the Company who contribute to management, growth, or profitability of the Company and are selected by the Compensation Committee (each a "Covered Executive" and, collectively, "Covered Executives") are eligible to receive a cash-settled award with vesting contingent on satisfaction of performance goals and certain service conditions (each a "Performance Award"). For 2013, the four most highly-compensated Covered Executives, excluding the Chief Financial Officer, are William Abbott, Edward Georger, Annie Howell, and Charles Stanford. For a Performance Award intended to qualify as deductible performance-based compensation, the performance goals are measurable and attainable targets selected by the Compensation Committee from the following list of metrics with respect to the Company: revenue, return on equity, return on assets, operating income, earnings per share, net income, total shareholder return, share price, shareholder value added, EBITDA, cash flow and/or viewer ratings. The Compensation Committee establishes performance goals using one or more of these metrics and upon the end of the applicable performance period, certifies the attainment of the performance goal.

        The maximum payout for the Performance Award granted in 2013 to the four most highly-compensated Covered Executives excluding the Chief Financial Officer is set forth as follows:

        Please see Compensation Discussion & Analysis—Elements of Executive Compensation Packages—Awards Granted Under 2012 Long Term Incentive Plan" for more information surrounding current Performance Awards granted under the 2012 LTIP.

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Annual Performance Bonus

        The Company pays annual incentive bonuses, earned during a calendar year, no later than March of the following year to Covered Executives. These Covered Executives have target percentages of base salary that are to be paid as annual bonuses (each a "Performance Bonus"), which percentages could increase or decrease during the term of employment upon approval by the Compensation Committee. In addition, the Compensation Committee sets measurable and attainable targets for the achievement of the Performance Bonus from the following list of metrics with respect to the Company: revenue, return on equity, return on assets, operating income, earnings per share, net income, total shareholder return, share price, shareholder value added, EBITDA, cash flow and/or viewer ratings. The Compensation Committee will certify the attainment of the performance goal upon completion of the calendar year. The maximum payout for the Performance Bonus granted in 2013 to the Covered Executives is set forth as follows:

        Please see Compensation Discussion & Analysis—Elements of Executive Compensation Packages—Annual Performance Bonus" for 2012 bonus opportunities and performance for the Covered Executives, including plan metrics, plan targets, calculations and other matters.

Federal Income Tax and Other Consequences

        Under Section 162(m) of the Internal Revenue Code and related treasury regulations and guidance, the Company may not be able to deduct certain forms of compensation in excess of $1,000,000 paid per year to its chief executive officer and its three most highly compensated officers (other than its CEO and CFO) who are employed by the Company at year-end. The Compensation Committee believes that it is generally in the Company's best interest to satisfy the requirements for deductibility under Internal Revenue Code Section 162(m). Accordingly, the Compensation Committee has taken appropriate actions, to the extent it believes feasible, to preserve the deductibility of annual incentive and long-term performance awards. However, notwithstanding this general policy, the Compensation Committee also believes that there may be circumstances in which the Company's interests are best served by maintaining flexibility in the way compensation is provided, whether or not compensation is fully deductible under Internal Revenue Code Section 162(m). Accordingly, the Company has expressly reserved the authority to award compensation not designed to be qualifying performance-based compensation under Internal Revenue Code Section 162(m) in appropriate circumstances. Further, because of ambiguities and uncertainties as to the application and interpretation of Section 162(m) and the regulations issued thereunder, no assurance can be given, notwithstanding the Company's efforts, that compensation intended by the Company to satisfy the requirements for deductibility under Section 162(m) does in fact do so.

        The Internal Revenue Code exempts qualifying performance-based compensation from the deduction limit if certain conditions are met. One of the conditions is stockholder approval of the performance-based compensation provisions. We are seeking stockholder approval of the Performance Awards and the Performance Bonuses for the Covered Executives described in this Proxy Statement.

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Securities Authorized for Issuance under Equity Compensation Plans

        Not applicable.

Recommendation of the Board

        The Company is authorized by the Compensation Committee to award Performance-Based Compensation to the Covered Executives and other executives of the Company. In approving award of Performance-Based Compensation, the Compensation Committee takes into account, among other things, the Covered Executives' potential contributions to the Company, their considerable business experience and media industry experience and the desirability of obtaining their long-term future commitment to the Company. The Board believes that it is desirable that Performance-Based Compensation be deductible for income tax purposes. Therefore, the Board recommends that stockholders approve the following:

•

Performance Awards granted to Covered Executives in 2013 under the 2012 LTIP; and



•

Performance Bonuses granted in 2013 to the Covered Executives.

THE BOARD RECOMMENDS THAT YOU VOTE "FOR" THE APPROVAL OF THE CHIEF EXECUTIVE OFFICER'S AND COVERED EXECUTIVES' PERFORMANCE-BASED COMPENSATION PROVISIONS

COMPENSATION DISCUSSION AND ANALYSIS

Overview and Objectives of the Compensation Program

        The Company's compensation packages to the executive officers, as determined by the Compensation Committee, are designed to enable the Company to recruit, retain and motivate a talented and diverse group of people who contribute to our success. The packages are also intended to synchronize executive compensation with the Company's performance, motivate executive officers to achieve our business objectives, provide strong performance incentives and minimize undue risk to the Company. The Company's Chief Executive Officer provides input on determining and recommending compensation packages of the executive officers other than himself. The goal of the Compensation Committee is that the packages are fair, well-balanced between short term and long term components and reasonable and competitive with other companies in the cable and television industry. To attain this goal, the Compensation Committee refers to third-party surveys to obtain a general understanding of current compensation practices in the cable and television industry. In 2012, the Compensation Committee reviewed the Croner CTHRA Cable Programmers/Broadcast Networks Compensation Survey and Towers Watson Cable Programmers Survey. The Compensation Committee also refers to such surveys for the purpose of benchmarking each executive officer's annual base salary, target bonus, target total cash compensation and target long term incentive awards against the compensation paid to comparable executive officers at other cable programmers. Fox Network, Scripps Networks, Discovery Communications, Disney ABC and Lifetime are a few of many cable programmers which participate in such third-party surveys. The Company targets total compensation at industry medians, using size-adjusted data where appropriate. If the Company's business objectives are significantly exceeded during any period, actual compensation packages offered to executive officers could be above market due to incentive pay.

        The Compensation Committee also focuses on aligning individual incentives with the Company's strategic and financial goals. Key incentive-based components in executive compensation packages are the annual Performance Bonus, which is awarded in recognition of individual and Company performance each year, and awards granted under our 2012 Long Term Incentive Plan (please see below for description).

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        The Company's Amended & Restated 2000 Long Term Incentive Plan, its only equity compensation plan, expired in 2012. The Board has determined that the Company's use of non-equity incentive awards, on a short term and long term basis, will enable the Company to continue to recruit, retain and motivate its executive officers.

Elements of Executive Compensation Packages

        Compensation packages awarded to the Named Executive Officers (defined below under "Compensation of Executive Directors") are comprised of base salary, annual cash bonus awards, awards granted under long term incentive plan and perquisites and other benefits.

Annual Base Salary

        Salary ranges for the Chief Executive Officer and the other Named Executive Officers are based on an individual's experience and prior performance, as well as the Company's operating performance and the attainment of planned financial and strategic goals. Annual salaries for the Named Executive Officers are established by the Compensation Committee, subject to the provisions of each respective employment agreement described below under the heading "Compensation of Executive Officers—Summary of Employment Agreements with Named Executive Officers". In determining whether or not to increase annual base salaries and the amount of any increase, the Compensation Committee evaluates annually each executive's individual performance, any change in the executive's position or duties, the Company's performance and attainment of initiatives, benchmarked data and commitments negotiated in the employment agreements. In 2012, Mr. Abbott's salary was increased by 2.5%, Mr. Georger's salary was increased by 1.0%, Ms. Howell's salary was increased by 5.0%, Mr. Rooke's salary was increased by 8.0% and Mr. Stanford's salary was increased by 2.5%.

Annual Performance Bonus

General

        The Company pays annual incentive bonuses earned in a calendar year no later than March of the following year. The annual performance bonus for each Named Executive Officer is established by the Compensation Committee, subject to the provisions of each respective employment agreement described below under the heading "Compensation of Executive Officers—Summary of Employment Agreements with Named Executive Officers." In addition, the Compensation Committee may, in its sole discretion, approve signing and discretionary bonuses for executive officers. Annual bonus payments for fiscal year 2012 paid to the Named Executive Officers were determined and calculated in accordance with the below formula. The Compensation Committee has the authority to modify the below formula for subsequent years. Annual performance bonuses are also granted to other executive vice presidents, senior vice presidents and vice presidents of the Company, who are not Named Executive Officers, with target award amounts granted ranging from 10% to 30% of each employee's annual base salary.

Annual Performance Bonus Opportunity

        2012 target incentive percentages of annual base salary for each Named Executive Officer are set forth below. Total bonus opportunity was 0% to 150% of the target incentive. Actual bonus amounts paid are dependent on the degree to which the Company achieves the objective for each plan measured

15

against performance ranges established for each metric. The Compensation Committee has the discretion to adjust the total award and the result for each metric up or down by up to 20 points.

Plan Metrics

        The Compensation Committee used the following metrics to determine bonus amounts earned by each Named Executive Officer in 2012:

Awards Granted Under 2012 Long Term Incentive Plan

General

        The Company has in place the 2012 Crown Media Holdings, Inc. Long-Term Incentive Plan (the "2012 LTIP"), under which the Compensation Committee has the discretion to grant incentive awards to our employees and directors, including, without limitation, cash awards based on a percentage of an employee's annual base salary. These awards are intended as incentives for long-term future performance and, combined with the executive's base salary and performance bonus, substantially form a total compensation package for the Company's executives.

Long Term Incentive Plan Awards ("LTIP Awards")

        Commencing 2011, the Company granted non-equity LTIP Awards to Named Executive Officers pursuant to LTIP Agreements, in lieu of RSUs (defined above under "Director Compensation"). The target amount of the award granted is based on a percentage of each employee's annual base salary, which percentages range from 25% to 85% for the award granted in 2013. The award is comprised of a Performance Award and an Employment Award. For awards granted in 2011 and 2012, each of Performance Award and Employment Award constitutes half of the award. For awards granted in 2013, Performance Award constitutes 60% of the award and Employment Award constitutes 40% of the award. Performance Award is based on the Company's achievement of a predetermined cash flow goal and an adjusted EBITDA goal over a three year performance period. In the case of involuntary termination of employment without cause on or after the one year anniversary date of the LTIP Agreement or an executive's death or disability, with respect to Employment Awards, a pro rata portion will vest immediately and, with respect to Performance Awards, a pro rata portion will vest and

16

be settled at the end of the performance period as if the executive had not been terminated. In the case of change in control of the Company and involuntary termination of employment without cause arising as a result thereof, an Employment Award will vest in its entirety immediately and a Performance Award will vest as if all performance goals had been achieved at target levels. The Compensation Committee also has the ability to adjust the Performance Awards based on relative market conditions, unusual activity or transactions or other unforeseen circumstances, provided, that no such adjustment may be made that would cause an LTIP Award designated as a qualified performance-based compensation not to qualify for, or to cease to qualify for, the Section 162(m) exemption. LTIP Awards were also granted since 2011 to other executive vice presidents, senior vice presidents and vice presidents of the Company, who are not Named Executive Officers, with target award amounts granted ranging from 18% to 40% of each employee's annual base salary.

        Below is a table summarizing certain key terms of the LTIP Awards granted to the Company's executive officers from 2011 to 2013.

        With respect to Performance Awards, the percentage of award payout will vary depending upon achievement of each of the two targets as follows:

        On each vesting date of a Performance Award, the Chief Financial Officer of the Company will confirm whether or not applicable performance targets have been achieved. If targets have been

17

achieved, management will submit payout calculations to the Compensation Committee for review and final determination.

Perquisites and Other Benefits

        All Company executives are also entitled, subject to meeting certain eligibility requirements, to participate in the Company's benefit programs, including the Company's 401(k) plan and its medical, dental and other benefits plans. Certain executive officers are entitled to additional benefits, such as car allowance, housing and transportation allowance, and particular travel expenses as agreed to under their respective employment agreements.

Compensation Consultants

        From time to time, the Compensation Committee engages and consults with a human resources consulting firm and an executive compensation consulting firm, when developing, analyzing and reviewing compensation packages to be awarded to its executive officers. Such firms have, in the past, provided to the Compensation Committee relevant executive compensation data related to companies in the cable and television industry similar in size to the Company, such as base salaries, termination payments and the level or formula for performance-based cash bonuses and other incentive awards. Additionally, such firms have assisted the Compensation Committee in structuring various incentive compensation plans. During 2012, the Compensation Committee did not engage any compensation consulting firm. The Compensation Committee and the Board also seek advice and recommendations from the human resource and compensation departments of Hallmark Cards, on executive and director compensation matters. Such services are rendered by Hallmark Cards pursuant to an intercompany services agreement which it has with the Company.

Deferred Compensation Plan

        The Company offers a Deferred Compensation Plan (the "Plan") to its executive officers and directors. The Plan offers an opportunity for the executive officers to defer payment, on a pre-tax basis, of portions of his or her salary, bonus, and LTIP Awards and all such deferred amounts will be credited with in an interest rate until distribution. With respect to the interest rate earned, the Company applies Moody's Average Corporate Bond Yield as in effect on the first day of each month. Under the Plan, an executive officer may defer a maximum of 50% of base salary, 100% of incentive compensation and 100% of LTIP Awards. The amount of total compensation deferred must be at least $5,000 (not including LTIP Awards).

        An executive officer may elect to receive payment of all or part of that Plan year's deferral amount in a future year (an in-service distribution), subject to earlier payment upon termination of employment. If such scheduled in-service distribution is more than $25,000, the distribution may be made in annual installments over 5 years. If such distribution is $25,000 or less, it must be taken as a lump sum. All scheduled in-service distributions will be paid in January.

Chief Executive Officer Compensation

        The provisions of our Chief Executive Officer's employment agreement and related agreements which have been approved by the Board, determined the salary and long term incentive awards granted to him during the fiscal year 2012. In approving the compensation levels contained in Mr. Abbott's compensation agreements, the Board reviewed and considered the expected value of his leadership that he would bring to the Company. The Board then set his compensation during the term of his employment agreement in levels that reflected his potential achievements and quality of the Company under his leadership.

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2011 Shareholder Advisory Vote on Executive Compensation

        During the 2011 Annual Meeting of Stockholders of the Company, the Company proposed that the shareholders vote, on an advisory basis, to approve or not approve the compensation of the Named Executive Officers (the "say-on-pay proposal") and whether the shareholders prefer that we seek such an advisory vote every one, two or three years (the "frequency vote"). The shareholders voted "FOR" the say-on-pay proposal and voted that future say-on-pay proposals be included in the Company's Proxy Statement every three years. The say-on-pay proposal was not intended to address any particular component of any compensation package but rather the overall compensation of such officers and the Company's compensation philosophy, policies and practices in the 2011 Proxy Statement, which are substantially similar to those described in this 2013 Proxy Statement. Although the say-on-pay vote was not binding, the Company carefully considered the voting results of the say-on-pay proposal in determining compensation policies and making compensation decisions reflected in this Proxy Statement. In light of the favorable vote on our say-on-pay proposal at the 2011 Annual Meeting, the Company is maintaining similar compensation levels and policies and determined that no significant changes to the Company's executive compensation program and policies were necessary in 2012. Based on the outcome of the frequency vote at the 2011 Annual Meeting, the Company has decided to solicit votes for future say-on-pay proposal every three years.

Tax Deductibility of Executive Compensation

        Please see under heading "Proposal 2—Approval of Chief Executive Officer's and Certain Other Executive Officers' Performance Based—Compensation—Federal Income Tax and Other Consequences" for a discussion on this matter.

COMPENSATION COMMITTEE REPORT

        The Compensation Committee has reviewed and discussed the above Compensation Discussion and Analysis with the Company's management. Based on the Compensation Committee's review and discussions with management, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Company's Proxy Statement.

        This report has been submitted by the members of the Compensation Committee and the members of the Board for the fiscal year 2012.

THE COMPENSATION COMMITTEE:

Robert Bloss, Chairman
Herbert Granath
A. Drue Jennings
Deanne R. Stedem

The preceding information under the caption "Compensation Committee Report" shall be deemed to be "furnished" but not "filed" with the Securities and Exchange Commission.

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COMPENSATION OF EXECUTIVE OFFICERS

Summary Compensation Table

        The following table summarizes compensation earned in 2010, 2011 and 2012 by individuals who served as our Chief Executive Officer, Chief Financial Officer and the three other most highly compensated executive officers serving at the end of 2012 (each, a "Named Executive Officer", collectively, the "Named Executive Officers").

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Grants of Plan-Based Awards

        The following plan-based awards were granted to the Named Executive Officers in 2012.

Outstanding Equity Awards at Fiscal Year-End

        There were no outstanding equity awards held by any Named Executive Officers on December 31, 2012.

Option Exercises and Stock Vested

        No stock options or stock-based awards vested or were exercised by any Named Executive Officers in 2012.

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Nonqualifed Deferred Compensation

        The Company has a Nonqualified Deferred Compensation Plan. Please see above under the headings "Compensation Discussion and Analysis—Deferred Compensation Plan" for a description of material terms of such plan.

Summary of Employment Agreements with Named Executive Officers

Employment Agreement with William Abbott

        On May 7, 2009, Mr. Abbott entered into an employment agreement that provides for his employment as President and Chief Executive Officer effective June 1, 2009 through December 31, 2011. Mr. Abbott's employment agreement provides that the term will automatically renew for one year periods if neither party provides notice to the other by June 30 of the last year of the term. Mr. Abbott's annual base salary was initially $670,000 per year plus an annual performance bonus with a target of 60% of his then-current base salary with a potential payout range of 0 to 150%. The Company's Compensation Committee has determined that criteria for this performance bonus shall be the same as that established for the senior management team. (See details pertaining to performance bonus below under heading "Compensation Discussion and Analysis—Elements of Executive Compensation Packages—Annual Performance Bonus.") If Mr. Abbott is terminated without cause, the Company must pay the net present value of his base salary for twelve (12) months and a pro rata portion of his bonus, through the date his job duties end, for the calendar year in which termination occurs; vested ERISA benefits; and any amounts required by the terms of his LTIP Agreements. On May 11, 2010, the Company amended Mr. Abbott's employment agreement to extend the term of his employment until December 31, 2012 and to increase Mr. Abbott's annual salary to $687,000 effective June 1, 2010. On March 1, 2012, the Company further amended Mr. Abbott's employment agreement and increased his annual salary to $767,000 effective March 1, 2012 and increased the target of his annual performance bonus to 70%. Annual base salary and performance bonus target percentage are

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considered for an increase annually in March pursuant to Mr. Abbott's employment agreement. As of March 2013, Mr. Abbott's base salary is $800,000 and his annual performance target is 75% of his base salary.

        Under the employment agreement, Mr. Abbott may not compete with the Company during the term of his employment. Additionally, for the one-year period following his termination of employment for any reason, Mr. Abbott may not employ any person who is working for the Company as an officer, policymaker or in a high-level creative, development or distribution position at the date of termination of Mr. Abbott's employment.

Employment Agreement with Edward Georger

        On June 15, 2009, the Company entered into an employment agreement with Edward Georger that provided for his employment as Executive Vice President, Advertising Sales, through December 31, 2011, which was amended in January 2011 to add "General Manager of Hallmark Movie Channel" to Mr. Georger's title. Under the employment agreement, which has expired, Mr. Georger's annual base salary was $550,000 and the Company agreed to consider adjusting his salary in January of each year during the term. Mr. Georger's contract also provided a bonus each year of up to 55% of his base salary, 30% of which was conditioned on the Company's achievement of goals under the Company's Executive Bonus Plan and the remaining 25% was conditioned on the Company's achievement of revenue goals under the Company's advertising sales incentive plan. (See details pertaining to performance bonus below under heading "Compensation Discussion and Analysis—Elements of Executive Compensation Packages—Annual Performance Bonus."). As of March 2013, Mr. Georger's base salary is $569,388 and his annual performance target is 65% of his base salary.

Employment Agreement with Annie Howell

        Ms. Howell joined the Company in October 2010 as Senior Vice President, Communications and Media Relations. On January 1, 2012, the Company and Ms. Howell entered into an employment agreement that provided for her employment as Executive Vice President, Communications and Media Relations and has a term through December 31, 2013. The employment agreement provided for an annual base salary of $310,000, which was increased to $317,750 on March 1, 2012, and could be increased further at the discretion of the Company in March of each subsequent year. In addition to the salary, Ms. Howell was eligible to receive an annual performance bonus with a target rate of 20% of her annual salary, conditioned on the Company's achievement of certain financial goals. (See details pertaining to performance bonus below under heading "Compensation Discussion and Analysis—Elements of Executive Compensation Packages—Annual Performance Bonus".) Annual base salary and performance bonus target percentage are considered for an increase annually pursuant to Ms. Howell's employment agreement. Ms. Howell also receives a housing and transportation allowance in the amount of $40,000 per year pursuant to her employment agreement. As of March 2013, Ms. Howell's base salary is $333,638 and her annual performance target is 30% of her base salary.

        Ms. Howell's employment agreement contains identical non-compete and non-solicitation provisions to those contained in Mr. Abbott's employment agreement described above.

Employment Agreement with Andrew Rooke

        On February 28, 2011, the Company and Mr. Rooke entered into an employment agreement, with a term through December 31, 2012. The employment agreement provided for an annual base salary of $410,000, subject to review and annual adjustments.. In addition to the salary, the employment agreement included an annual performance bonus (at a target rate of 25% of his annual salary conditioned on the Company's achievement of certain financial goals. (See details pertaining to performance bonus below under heading "Compensation Discussion and Analysis—Elements of Executive

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Compensation Packages—Annual Performance Bonus".) Mr. Rooke's employment agreement was amended as of January 1, 2013 to extend the term through December 31, 2014, increase his annual base salary to $465,000 and increase each of performance bonus and LTIP Award target to 50% of his annual base salary. Annual base salary and performance bonus target percentage are considered for an increase annually pursuant to Mr. Rooke's employment agreement. As of March 2013, Mr. Rooke's base salary is $465,000 and his annual performance target is 50% of his base salary.

        Mr. Rooke's employment agreement contains identical non-compete and non-solicitation provisions to those contained in Mr. Abbott's employment agreement described above.

Employment Agreement with Charles L. Stanford

        On August 8, 2006, the Company entered into an employment agreement with Charles L. Stanford, for his services as Executive Vice President, Legal and Business Affairs and General Counsel, which was amended on January 29, 2008 and subsequently replaced by the agreement described below.. The subsequent agreement, as amended, was through August 8, 2010 and provided for an annual base salary of $485,268, subject to a minimum increase of 3% in October of each year of his term. Mr. Stanford was also entitled to receive a bonus each year of up to 20% of his base salary, conditioned on the Company's achievement of certain financial goals. On May 3, 2010, the Company amended Mr. Stanford's employment agreement to extend the term of his employment until December 31, 2011. On January 1, 2012, the Company entered into a new employment agreement with Mr. Stanford which replaced the employment agreement described above. The new employment agreement extended the term of his employment through December 31, 2013 and provided for an annual salary of $543,470. Mr. Stanford is also entitled to receive a bonus each year of no less than 30% of his base salary, conditioned on the Company's achievement of certain financial goals. (See details pertaining to performance bonus below under heading "Compensation Discussion and Analysis—Elements of Executive Compensation Packages—Annual Performance Bonus".) Annual base salary and performance bonus target percentage are considered for an increase annually in March pursuant to Mr. Stanford's employment agreement. As of March 2013, Mr. Stanford's base salary is $557,058 and his annual performance target is 35% of his base salary.

        Mr. Stanford's employment agreement contains identical non-compete and non-solicitation provisions to those contained in Mr. Abbott's employment agreement described above.

Potential Payments Upon Termination or Change-in-Control

Employment Agreements

        In all of our employment agreements with our Named Executive Officers, if his or her employment is terminated other than for death, disability or cause prior to the expiration of the employment agreements, the following will be paid by the Company:

•

twelve months base salary, paid in a lump sum and discounted at prime rate to present value at the time of payment;



•

pro rata bonus through the termination date;



•

any amounts payable under the LTIP Agreements;



•

vested ERISA benefits, such as those under the 401(k) plan; and



•

benefits that may be required by law, such as those under COBRA.

        In the event of termination for the reason stated above, the Named Executive Officer has no obligation to seek comparable employment and, if the executive accepts employment during the severance period, there will be no offset by the Company against the amounts paid for termination.

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Additionally, the non-competition provision in the employment agreements will not apply from the termination date.

        If a Named Executive Officer's employment is terminated as a result of death, disability or for cause, the following will be paid by the Company:

•

salary through the later of (i) expiration date of the 5 business days after the event which triggered the termination or (ii) end of the month in which the triggering event occurred;



•

any amounts payable under the LTIP Agreements;



•

vested ERISA benefits, such as those under the 401(k) plan; and



•

benefits that may be required by law, such as those under COBRA.

LTIP Agreements

        In the case of involuntary termination of employment without cause on or after the one year anniversary date of the LTIP Agreement or an executive's death or disability, with respect to Employment Awards, a pro rata portion will vest immediately and, with respect to Performance Awards, a pro rata portion will vest and be settled at the end of the performance period as if the executive had not been terminated. In the case of change in control of the Company and involuntary termination of employment without cause arising as a result thereof, an Employment Award will vest in its entirety immediately and a Performance Award will vest as if all performance goals had been achieved at target levels. Except for the occurrence of termination events described above, outstanding LTIP Awards will generally expire upon termination of employment.

        The pro rata percentage will be calculated by taking the number of days an executive was employed by the Company commencing with the date of the LTIP Agreement divided by the total number of days, commencing with the date of the applicable LTIP Agreement and concluding with the applicable scheduled vesting date set forth in the applicable LTIP Agreement. In the case of change in control of the Company and involuntary termination of employment arising as a result thereof, Employment Award will vest in its entirety immediately and Performance Award will vest in its entirety as if all performance goals have been achieved at target levels.

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Summary of Potential Termination or Change-in-Control Payments

        The table below reflects the dollar amount of compensation to each Named Executive Officer who is employed by the Company as of the date of this Proxy Statement in the event of termination of such individual's employment prior to the expiration of the employment agreements. The amounts shown assume that the termination was effective December 31, 2012.

WILLIAM ABBOTT

EDWARD GEORGER

ANNIE HOWELL

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ANDREW ROOKE