Current Report Filing (8-k)
February 24 2017 - 4:56PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report
(Date of earliest event reported):
February 21, 2017
GANNETT CO.,
INC.
(Exact name
of registrant as specified in charter)
Delaware
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1-36874
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47-2390983
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(State or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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7950 Jones
Branch Drive, McLean, Virginia, 22107-0910
(Address of
principal executive offices, including zip code)
(703) 854-6000
(Registrant’s
telephone number, including area code)
N/A
(Former name
or former address, if changed since last report)
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
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On February
21, 2017, the Executive Compensation Committee of the Board of Directors (the “Committee”) of Gannett Co., Inc. (the
“Company”) approved the 2017 executive annual incentive plan (the “AIP”) and 2017 stretch goals (the “Stretch
Goals”) pursuant to which the Committee will determine the amount of cash incentive compensation payable for 2017 to each
of our executive officers under the Company’s 2015 Omnibus Incentive Compensation Plan (the “Omnibus Plan”).
2017 Executive Annual Incentive
Plan
The AIP establishes
the parameters according to which the Committee will determine the amount of annual cash incentive compensation payable to each
executive officer for 2017 pursuant to the Omnibus Plan. In the case of our CEO, the AIP provides that the bonus amount will be
determined by the Committee subject to ratification by the independent directors serving on our Board. Initially, the AIP fixes
an individual annual cash bonus target for each executive officer participating in the AIP, expressed as a percentage of the executive’s
eligible base salary. As further described below, the bonus amount payable to each executive will be based on the Company’s
performance relative to specified financial goals and the executive’s performance relative to specified individual and cultural
goals. Goals under the AIP will be independent of each other and structured such that executives may receive a portion of their
annual bonuses based upon achievement relative to one or more of the goals, even if required levels of performance are not met
for payments for other goals.
Company-Wide
Financial Goals
A portion of
the annual cash bonuses payable to our executive officers will be based on the extent to which the Company achieves the Company-wide
financial goals specified in the AIP. The financial goals are assigned an overall weight of 70% for the CEO and 60% for other executives.
The financial goals specified in the AIP are as follows:
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2017 Adjusted EBITDA Budget
. Of the portion
of the bonus based on Company financial performance, 70% will be based on the Company’s achievement relative to an Adjusted
EBITDA Budget target. “Adjusted EBITDA Budget” is defined as the Company’s earnings before interest, taxes, depreciation
and amortization, excluding items approved by the Committee that are “one-time” in nature and affect the comparability
of the Company’s financial results. In addition, Adjusted EBITDA Budget will be calculated by fixing pension and medical
expenses at predetermined budgeted amounts and fixing the exchange rate for British pounds to U.S. dollars at a predetermined budgeted
rate. These further adjustments effectively will exclude from Adjusted EBITDA Budget significant positive or negative variances
in pension and medical expenses that may occur during the year, as well as significant variances in Newsquest’s EBITDA contributions
due to foreign exchange rate fluctuations.
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2017 Digital Revenue
. Of the portion of the
bonus based on Company financial performance, 30% will be based on the Company’s achievement relative to a digital revenue
target. “Digital Revenue” is defined as digital advertising revenues plus revenues generated from sales of digital-only
subscriptions. Digital advertising revenues include revenues generated by (a) selling display and video advertising on desktop
and mobile platforms, (b) selling classifieds on third-party platforms, and (c) selling other digital products and services such
as search engine marketing and optimization, social and email advertising, directories, digital syndication, archives, and software
and web-presence products. Digital-only subscriptions generally include digital-only newspaper subscriptions on desktop, mobile
web or native apps. For these purposes, Newsquest’s contributions to digital revenue will be calculated using the predetermined
pounds-to-dollars exchange rate described above.
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In determining
actual bonus amounts payable relative to the Company-wide financial goals, the Committee will evaluate threshold, target and maximum
levels of performance for each goal as follows:
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Threshold: Achievement of 75% of target results in
a 50% payout.
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Target: Achievement of target results in a 100% payout.
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Maximum: Achievement of 120% of target results in
a 150% payout.
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No bonus will be paid pursuant to either
goal if the threshold level of performance for that goal is not met, and no amounts will be payable over the maximum for either
goal. Amounts between threshold, target and maximum will be interpolated on a straight-line basis.
Individual
Performance and Cultural Goals
In
addition to the Company-wide financial goals, the Committee believes that strategic individual performance and cultural goals
relative to predetermined objectives should play a role in the cash bonus payable to each executive officer. Accordingly, the
Committee has determined that 15% of the overall cash bonus for the CEO and 25% of the overall cash bonus for each other
executive officer for 2017 will be based upon the Committee’s assessment the executive’s achievement of
individual performance goals. The individual performance goals will be specific to each executive based on his or her role
within the Company and particular areas of responsibility, and consist of non-financial goals that advance the
Company’s business strategy (such as expanding the Company’s footprint, optimizing the use of existing assets
and transitioning to digital). In addition, 15% of the overall cash bonus for the CEO and each other executive
officer will be based on the Committee’s assessment of the officer’s achievement of cultural goals. The cultural
goals also will be specific to each executive and relate to his or her contributions towards promoting the Company’s
cultural values (such as diversity and inclusiveness). The maximum amount payable in respect of the individual performance
goals and culture goals will be 150% of each executive’s target amount for such goals. The Committee will retain full
discretion in respect of all amounts awarded under this portion of the AIP. No executive officer is guaranteed an award and,
if performance is unsatisfactory, no bonus will be paid under the individual performance or cultural components of the
AIP.
2017 Stretch Goals
In addition
to the AIP, the Committee approved three Stretch Goals for 2017, pursuant to which our executive officers have an opportunity to
earn additional cash incentive compensation under the Omnibus Plan if, by the end of 2017, the Company achieves certain strategic
milestones related to our digital transformation. As with the AIP, achievement of each Stretch Goal will be evaluated independently
of the others. Executives will receive a payment equal to 8.33% of their annual base salaries if any one goal is met, a payment
equal to 16.66% of their annual base salaries if any two goals are met, and a payment equal to 25% of their annual base salaries
if all three goals are met.
SIGNATURES
Pursuant to
the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
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Gannett Co., Inc.
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Date: February 24, 2017
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By:
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/s/ Barbara W. Wall
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Barbara W. Wall
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Senior Vice President and Chief Legal Officer
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