Item 1.01 Entry into a Material Definitive Agreement.
On December 21, 2020, Gannett Co., Inc. (the “Company”) entered into a Termination Agreement (the “Termination Agreement”) with FIG LLC (the “Manager”), the
Company’s external manager and an affiliate of Fortress Investment Group LLC, to provide for the termination of the Amended and Restated Management and Advisory Agreement, dated as of August 5, 2019 (the “Management Agreement”).
In connection with the Termination Agreement, on December 21, 2020, the Company entered into a Supplemental Indenture (the “Supplemental Indenture”) to the
Indenture (the “Indenture”) dated as of November 17, 2020, between the Company, certain subsidiaries of the Company (the “Subsidiary Guarantors”) and U.S. Bank National Association, as trustee (the “Trustee”), governing the Company’s 6% Senior
Secured Convertible Notes due 2027 (the “Notes”). The Supplemental Indenture amends two negative covenants in the Indenture to allow for the execution of the Termination Agreement.
On December 21, 2020, the Company also entered into Amendment No. 5 (the “Amendment”) to its Credit Agreement, dated November 19, 2019 (as amended, supplemented
or otherwise modified prior to the date hereof, the “Credit Agreement”) with Gannett Holdings LLC, as the borrower, Alter Domus Products Corp., as administrative agent and collateral agent, and the lenders party thereto. The Amendment provides for
certain amendments, modifications and waivers to the Credit Agreement to allow for the execution of the Termination Agreement.
Termination Agreement
On December 21, 2020, the Company entered into the Termination Agreement with the Manager to terminate the Management Agreement. Under the Management
Agreement, the operations of the Company are currently managed by the Manager, subject to the supervision of the Company’s Board of Directors (the “Board”).
Under the Termination Agreement, the Management Agreement will terminate effective as of 11:59 p.m., Eastern Time, on December 31, 2020 (the “Effective Date”),
except that certain indemnification and other obligations will survive. In connection with the termination of the Management Agreement, the Company will make a one-time cash payment of $30,375,000 to the Manager (the “Termination Payment”). In
addition, on the Effective Date, all transfer restrictions contained in the Management Agreement on shares of common stock, par value $0.01 per share, of the Company (“Common Stock”) owned by the Manager, or acquired by the Manager upon the exercise
of stock options to acquire Common Stock, shall lapse.
As described in the Termination Agreement, the Company intends to extend offers of employment to certain employees of the Manager or its affiliates who provide
services to the Company, including the Company’s Chief Executive Officer. The Manager has agreed to be solely responsible for the payment of all compensation payable to such employees with respect to the period prior to the Effective Date, whether
payable prior to or following the Effective Date, including any discretionary cash bonus payment payable in respect of the 2020 calendar year, subject to the Manager’s right to be reimbursed by the Company for such compensation payments to the extent
reimbursable pursuant to the Management Agreement.
The Termination Agreement was unanimously approved by a committee of the Board composed entirely of independent and disinterested directors.
The foregoing description of the Termination Agreement does not purport to be complete and is qualified in its entirety by reference to the Termination
Agreement filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Supplemental Indenture
In connection with the Termination Agreement, on December 21, 2020, the Company, the Subsidiary Guarantors and the Trustee executed the Supplemental Indenture,
which, among other things, (i) amends two of the negative covenants of the Indenture to allow for the execution of the Termination Agreement and (ii) allows for the payment to the Manager of the Termination Payment.
The foregoing description of the Supplemental Indenture does not purport to be complete and is qualified in its entirety by reference to the Supplemental
Indenture filed herewith as Exhibit 10.2 to this Current Report on Form 8-K and incorporated herein by reference.
Amendment to the Credit Agreement
In connection with the Termination Agreement, the Company entered into the Amendment, which amended the Credit Agreement to permit (i) the termination of the
Management Agreement and (ii) the Termination Payment.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the Amendment filed herewith as
Exhibit 10.3 to this Current Report on Form 8-K and incorporated herein by reference.
Press Release
On December 22, 2020, the Company issued a press release (the “Press Release”) announcing the Termination Agreement and the termination of the Management Agreement.
The foregoing description of the Press Release does not purport to be complete and is qualified in its entirety by reference to the Press Release filed herewith as Exhibit 99.1 to this Current Report on Form 8-K.