UNITED STATES
SECURITIES AND
EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE 13E-3
RULE 13e-3 TRANSACTION STATEMENT
UNDER SECTION 13(e) OF
THE SECURITIES EXCHANGE ACT OF 1934
TRIBUNE PUBLISHING
COMPANY
(Name of the Issuer)
Tribune Publishing Company
Tribune Enterprises, LLC
Tribune Merger Sub, Inc.
Alden Global Capital LLC
Alden Global Opportunities Master Fund,
L.P.
AGOF Master GP, Ltd.
Alden Global Value Recovery Master Fund,
L.P.
AGVRF Master GP, Ltd.
Turnpike Limited
Heath
B. Freeman
Randall D. Smith
(Names of Persons Filing Statement)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
63934E108
(CUSIP Number of Class of Securities)
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Terry Jimenez
Tribune Publishing Company
560 W. Grand Avenue
Chicago, IL 60654
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Tribune Enterprises, LLC
Tribune Merger Sub, Inc.
Alden Global Opportunities Master Fund,
L.P.
AGOF Master GP, Ltd.
Alden Global Value Recovery Master Fund,
L.P.
AGVRF Master GP, Ltd.
Turnpike Limited
Heath Freeman
Alden Global Capital LLC
Randall Smith
c/o Alden Global Capital LLC
777 South Flagler Drive
West Tower, Suite 800
West Palm Beach, FL 33401
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(Name, Address, and Telephone Numbers
of Person Authorized to Receive Notices
and Communications on Behalf of the Persons
Filing Statement)
With copies to
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Harold Birnbaum
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, NY 10017
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David D’Urso
Akin Gump Strauss Hauer & Feld
One Bryant Park
New York, NY 10036
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THIS TRANSACTION, PASSED ON THE MERITS OR THE FAIRNESS OF THE TRANSACTION OR
PASSED UPON THE ADEQUACY OR ACCURACY OF THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
This statement is filed in connection with (check the appropriate
box):
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a.
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☒
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The filing of solicitation materials or an information statement subject to Regulation 14A (§§ 240.14a-1 through 240.14b-2), Regulation 14C (§§ 240.14c-1 through 240.14c-101) or Rule 13e-3(c) (§ 240.13e-3(c)) under the Securities Exchange Act of 1934 (the “Exchange Act”).
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b.
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☐
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The filing of a registration statement under the Securities Act of 1933.
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c.
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☐
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A tender offer.
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d.
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☐
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None of the above.
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Check the following box if the soliciting materials or information
statement referred to in checking box (a) are preliminary copies: ☒
Check the following box if the filing is a final amendment reporting
the results of the transaction: ☐
CALCULATION OF FILING FEE
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Transaction Valuation*
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Amount of Filing Fee**
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$450,143,623
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$49,110.67
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*
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Solely for the purpose of calculating the filing fee, the underlying value of the transaction was calculated as the sum of: (A) 36,726,500 shares of common stock less 11,554,306 shares of common stock owned by Parent and its subsidiaries, multiplied by $17.25; (B) 276,301 shares of common stock with an exercise price less than $17.25, multiplied by $2.43 (which is the difference between $17.25 and the weighted average exercise price of $14.82 for such options, rounded to the nearest cent); and (C) 884,213 shares of common stock underlying the Company’s restricted stock units, multiplied by $17.25.
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**
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The amount of the filing fee, calculated in accordance with Rule 0-11 of the Exchange Act was calculated by multiplying $450,143,623 by 0.00010910.
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☒
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Check the box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule, and the date of its filing.
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Amount Previously Paid:
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$49,110.67
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Filing Party:
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Tribune Publishing Company
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Form or Registration No.:
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Schedule 14A
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Date Filed:
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March 23, 2021
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INTRODUCTION
This Rule 13e-3 Transaction Statement on Schedule 13E-3, together
with the exhibits hereto (this “Transaction Statement”), is being filed with the Securities and Exchange Commission
(the “SEC”) pursuant to Section 13(e) of the Exchange Act, by (a) Tribune Publishing Company, a Delaware corporation
(“Tribune”), the issuer of the shares of common stock, par value $0.01 per share (the “Common Stock”)
that are the subject of the Rule 13e-3 transaction; (b) Tribune Enterprises, LLC, a Delaware owned limited liability company (“Parent”);
(c) Tribune Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”);
(d) Alden Global Opportunities Master Fund, L.P., a Cayman Islands limited partnership (“AGOMF”); (e) Alden
Global Value Recovery Master Fund, L.P, a Cayman Islands limited partnership (“AGVRMF” and, together with AGOMF,
the “Alden Funds”); (f) Alden Global Capital LLC, a Delaware limited liability company (“Alden Global
Capital” and, together with the Alden Funds, “Alden”); (g) Turnpike Limited, a Cayman Islands exempted
company (“Turnpike”); (h) AGOF Master GP, Ltd., a Cayman Islands exempted company (“AGOF”);
(i) AGVRF Master GP, Ltd., a Cayman Islands exempted company (“AGVRF”); (j) Heath B. Freeman; and (k) Randall
D. Smith. Collectively, the persons filing this Transaction Statement are referred to as the “filing persons.”
This Transaction Statement relates to the Agreement and Plan
of Merger, dated February 16, 2021 (the “Merger Agreement”), by and among Tribune, Parent and Merger Sub. The
Merger Agreement provides that Merger Sub will merge with and into Tribune, with Tribune continuing as the surviving corporation
(the “Surviving Corporation”) and becoming a wholly owned subsidiary of Parent (the “Merger”).
If the Merger is completed, subject to the terms of the Merger
Agreement, each outstanding share of Common Stock will automatically be converted into the right to receive an amount in cash equal
to $17.25, without interest, other than shares of Common Stock (i) owned by (x) Parent, its subsidiaries and affiliates and its
and their respective directors and officers (collectively, the “Alden Parties”); or (y) Tribune as treasury
stock, which shares in clauses (x) and (y) we refer to as “excluded shares”; and (ii) held by stockholders who have
not voted in favor of the Merger and properly and validly perfected their statutory rights of appraisal in accordance with Section
262 of the Delaware General Corporation Law (the “DGCL”), which shares we refer to as “dissenting shares,”
which shares will be canceled without payment of any consideration therefor and will cease to exist. Treatment of outstanding equity
plan awards under Tribune’s equity incentive plans is described in greater detail in the Proxy Statement (defined below)
under “The Merger Agreement—Treatment of Common Stock and Equity Plan Awards.” Further, following completion
of the Merger, the shares of Common Stock will cease to be listed on NASDAQ and registration of the Common Stock under the Exchange
Act will be terminated.
The Merger and the Merger Agreement have been approved by the
board of directors of Tribune.
Concurrently with the filing of this Transaction Statement,
Tribune is filing a notice of meeting and a proxy statement (the “Proxy Statement”) under Section 14(a) of the
Exchange Act, with respect to the special meeting of stockholders (the “Special Meeting”), at which the stockholders
will be asked to consider and vote on (1) a proposal to adopt and approve the Merger Agreement (the “Merger Proposal”),
(2) a proposal to approve, by non-binding, advisory vote, certain compensation arrangements for Tribune’s named executive
officers in connection with the Merger (the “Merger Compensation Proposal”) and (3) a proposal to approve the
adjournment or postponement of the Special Meeting, if necessary, to continue to solicit votes for the Merger Proposal. A copy
of the Proxy Statement is attached hereto as Exhibit (a)(1) and a copy of the Merger Agreement is attached as Annex A to the Proxy
Statement. Adoption and approval of the Merger Proposal requires the affirmative vote of (i) at least two-thirds of the shares
of Common Stock (other than shares “owned” by Parent or Merger Sub and their “affiliates” and “associates”
(as each term is defined in Section 203 of the DGCL)) outstanding and entitled to vote on such matter and (ii) a majority in voting
power of the outstanding shares of Common Stock entitled to vote on such matter.
The approval of the Merger Proposal is a condition to the completion
of the Merger.
Pursuant to General Instruction F to Schedule 13E-3, the information
contained in the Proxy Statement, including all annexes thereto, is expressly incorporated herein by reference in its entirety,
and responses to each item herein are qualified in their entirety by the information contained in the Proxy Statement and the annexes
thereto. The cross-references below are being supplied pursuant to General Instruction G to Schedule 13E-3 and show the location
in
the Proxy Statement of the information required to be included
in response to the items of Schedule 13E-3. As of the date hereof, the Proxy Statement is in preliminary form and is subject to
completion.
All information contained in this Transaction Statement concerning
any of the filing persons has been provided by such filing person and no filing person has produced any disclosure with respect
to any other filing persons.
TABLE OF CONTENTS
ITEM 1. SUMMARY TERM SHEET
The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
ITEM 2. SUBJECT COMPANY INFORMATION
(a) Name and Address.
Tribune Publishing Company
560 W. Grand Avenue
Chicago, Illinois 60654
(312) 222-9100
(b) Securities. The
information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary about the Special Meeting”
“Questions and Answers about the Special Meeting and the
Merger”
(c) Trading Market and Price. The information
set forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Market Price of Common Stock and Dividend Information”
(d) Dividends. The information set forth
in the Proxy Statement under the following caption is incorporated herein by reference:
“Market Price of Common Stock and Dividend Information”
(e) Prior Public Offerings. Not applicable.
(f) Prior Stock Purchases. Not applicable.
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSONS
(a)–(c) Name and Address; Business and Background of
Entities; Business and Background of Natural Persons. The information set forth in the Proxy Statement under the following
captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Proposal 1 – Merger Proposal – Parties to
the Merger”
“Important Additional Information Regarding the Purchaser
Group”
“Where You Can Find More Information”
The name, business address, present principal employment and
citizenship of each director and executive officer of Tribune are set forth below. Unless otherwise noted, each director and officer
has held his or her present principal employment for the past five years.
As of [●], the directors and executive officers of Tribune
beneficially owned and were entitled to vote, in the aggregate, [●] shares of Common Stock (not including any shares of such
Common Stock deliverable upon exercise or conversion of any options, or restricted stock units), representing approximately [●]%
of the outstanding voting power of Common Stock.
During the past five years, none of the directors or officers
listed below has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) party
to any judicial or administrative
proceeding (except for matters that were dismissed without sanction
or settlement) that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting
activities subject to, federal or state securities laws, or a finding of any violation of federal or state securities laws.
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Name
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Present Principal
Employment
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Business Address
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Other Material Occupations or
Employment in past 5 years and address
(if applicable)
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Citizenship
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Directors
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Terry Jimenez
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Chief Executive Officer and President of Tribune (since January 2020)
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560 W. Grand Avenue
Chicago, IL 60654
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Executive Vice President and Chief Financial
Officer of Tribune (April 2016 to January 2020)
560 W. Grand Avenue
Chicago, IL 60654
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USA
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Carol Crenshaw
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Member of the Board of Directors of Tribune (since April 2016)
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560 W. Grand Avenue
Chicago, IL 60654
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Member of the Board of Directors of Northern
Illinois University Foundation
Altgeld Hall 135
DeKalb, IL 60115
Chief Financial Officer and Vice President
of Finance of The Chicago Community Trust (1983 to September 2018)
225 North Michigan Avenue
Suite 2200
Chicago, IL 60601
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USA
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Richard Reck
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President of Business Strategy Advisors LLC (since 2002)
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128 Hillcrest Avenue
Hinsdale, IL 60521
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Member of the Board of Directors of SilkRoad,
Inc. (since January 2014)
100 S Wacker Dr.
Suite 425
Chicago, IL 60606
Member of the Board of Advisors of Ultra
Corporation (since 2012)
939 W. North Avenue
Suite 750
Chicago, IL 60642
Member of the Board of Directors of Advanced
Life Sciences Holdings, Inc. (since 2005)
(inactive—no address)
Member of the Board of Directors of Interactive
Intelligence Group, Inc. (May 2005 to December 2016)
7601 Interactive Way
Indianapolis, IN 46278
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USA
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Name
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Present Principal
Employment
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Business Address
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Other Material Occupations or
Employment in past 5 years and address
(if applicable)
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Citizenship
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Philip G. Franklin
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Chair of the Board of Directors of Tribune (since 2020 and member since August 2014)
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560 W. Grand Avenue
Chicago, IL 60654
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Member of the Board of Directors of TTM
Technologies, Inc.
200 East Sandpointe
Suite 400
Santa Ana, CA 92707
Chief Financial Officer of Littelfuse, Inc.
(1999 to April 2016)
8755 West Higgins Road
Suite 500
Chicago, IL 60631
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USA
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Christopher Minnetian
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President of Smith Management LLC (since 2014)
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885 Third Avenue, 34th Floor
New York, NY 10022
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Member of the Board of Directors of MNG
Enterprises, Inc.
101 W. Colfax Avenue
Suite 1100
Denver, CO 80202
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USA
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Dana Needleman
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President of The Cogent Group LLC (since
2009)
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One Grand Central Place, 46th Floor
New York, NY 10165
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Member of the Board of Directors of Fred’s
Inc. (since September 2019)
4300 Getwell Rd
Memphis, TN 38118
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USA
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Randall D. Smith
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Founder of Alden Global Capital (since 2007)
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885 Third Avenue, 34th Floor
New York, NY 10022
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N/A
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USA
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Executive Officers
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Terry Jimenez
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President and Chief Executive Officer
of Tribune (since January 2020)
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560 W. Grand Avenue
Chicago, IL 60654
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Executive Vice President and Chief
Financial Officer of Tribune (April 2016 to January 2020)
560 W. Grand Avenue
Chicago, IL 60654
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USA
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Michael Lavey
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Interim Chief Financial Officer,
Controller and Chief Accounting Officer of Tribune (since February 2020)
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560 W. Grand Avenue
Chicago, IL 60654
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Controller and Chief Accounting
Officer of Tribune (May 2018 to February 2020), Senior Vice President, Corporate Controller (May 2015 to May 2018)
560 W. Grand Avenue
Chicago, IL 60654
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USA
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ITEM 4. TERMS OF THE TRANSACTION
(a)(1) Material Terms – Tender Offers. Not applicable
(a)(2) Material Terms – Merger or Similar Transactions.
The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Summary about the Special Meeting – Vote Required”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Plans for the Company after the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“The Merger – Merger Consideration”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“The Merger – Opinion of Lazard Frères &
Co.”
“The Merger – Interests of Certain Persons in the
Merger”
“The Merger – Material U.S. Federal Income Tax Consequences
of the Merger”
“The Merger Agreement – Treatment of Common Stock
and Equity Plan Awards”
“Annex A: Agreement and Plan of Merger”
“Annex B: Opinion of Lazard Frères & Co”
(c) Different Terms. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“The Merger – Merger Consideration”
“The Merger – Interests of Certain Persons in the
Merger”
“The Merger Agreement – Treatment of Common Stock
and Equity Plan Awards”
(d) Appraisal Rights. The information set forth in the
Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal –
Appraisal Rights”
“Questions and Answers about the Special Meeting and the
Merger”
“The Special Meeting – Rights of Stockholders Who
Seek Appraisal”
“Appraisal Rights”
(e) Provisions for Unaffiliated Security Holders. The
information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Provisions for Unaffiliated Stockholders”
(f) Eligibility for Listing or Trading. Not applicable.
ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS
(a) Transactions. The information set forth in the Proxy
Statement under the following captions is incorporated herein by reference:
“Transactions between the Company and the Purchaser Group”
(b)–(c) Significant Corporate Events; Negotiations
or Contacts. The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Plans for the Company after the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“Special Factors – Fees and Expenses”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“Transactions between the Company and the Purchaser Group”
“Annex A: Agreement and Plan of Merger”
(e) Agreements Involving the Subject Company’s Securities.
The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Plans for the Company after the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“Special Factors – Fees and Expenses”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“Transactions between the Company and the Purchaser Group”
“Annex A: Agreement and Plan of Merger”
ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS
(b) Use of Securities Acquired. The information set forth
in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors – Plans for the Company after the
Merger”
“The Merger – Merger Consideration”
“The Merger – Interests of Certain Persons in the
Merger”
“The Merger Agreement – Treatment of Common Stock
and Equity Plan Awards”
(c)(1)–(8) Plans. The information set forth in
the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Plans for the Company after the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“Special Factors – Fees and Expenses”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“The Merger – Interests of Certain Persons in the
Merger”
“The Merger Agreement”
“Delisting and Deregistration of Common Stock”
“Annex A: Agreement and Plan of Merger”
ITEM 7. PURPOSES, ALTERNATIVES, REASONS AND EFFECTS
(a) Purposes. The information set forth in the Proxy
Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“The Merger – Background of the Merger”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
(b) Alternatives. The information set forth in the Proxy
Statement under the following captions is incorporated herein by reference:
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“The Merger – Background of the Merger”
(c) Reasons. The information set forth in the Proxy Statement
under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“The Merger – Background of the Merger”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Plans for the Company after the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
(d) Effects. The information set forth in the Proxy Statement
under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors – Purposes and Reasons of the Purchaser
Group for the Merger”
“Special Factors – Plans for the Company after the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“The Merger – Merger Consideration”
“The Merger – Interests of Certain Persons in the
Merger”
“The Merger - Material U.S. Federal Income Tax Consequences
of the Merger”
“The Merger Agreement – Treatment of Common Stock
and Equity Plan Awards”
“Appraisal Rights”
“Annex A: Agreement and Plan of Merger”
ITEM 8. FAIRNESS OF THE TRANSACTION
(a)–(b) Fairness; Factors Considered in Determining
Fairness. The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“The Merger – Opinion of Lazard Frères &
Co.”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“Annex B: Opinion of Lazard Frères & Co.”
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated December 22, 2020 is attached hereto as Exhibit (c)(1) and
is incorporated by reference herein.
The Valuation Analysis of Lazard Frères & Co. presented
to the Board of Directors of Tribune Publishing Company dated December 30, 2020 is attached hereto as Exhibit (c)(2) and is incorporated
by reference herein.
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated January 14, 2021 is attached hereto as Exhibit (c)(3) and
is incorporated by reference herein.
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated February 5, 2021 is attached hereto as Exhibit (c)(4) and
is incorporated by reference herein.
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated February 11, 2021 is attached hereto as Exhibit (c)(5) and
is incorporated by reference herein.
The Valuation Analysis of Lazard Frères & Co. presented
to the Special Committee of Tribune Publishing Company dated February 15, 2021 is attached hereto as Exhibit (c)(6) and is incorporated
by reference herein.
(c) Approval of Security Holders. The information set
forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Summary about the Special Meeting – Vote Required”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“The Merger – Background of the Merger”
(d) Unaffiliated Representative. The information set
forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Provisions for Unaffiliated Stockholders”
(e) Approval of Directors. The information set forth
in the Proxy Statement under the following captions is incorporated herein by reference:
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
(f) Other Offers.
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
ITEM 9. REPORTS, OPINIONS, APPRAISALS AND NEGOTIATIONS
(a)–(c) Report, Opinion or Appraisal; Preparer and
Summary of the Report, Opinion or Appraisal; Availability of Documents. The information set forth in the Proxy Statement under
the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“The Merger – Background of the Merger”
“The Merger – Reasons for the Merger; Recommendation
of the Company’s Special Committee and Board”
“The Merger – Opinion of Lazard Frères &
Co.”
“The Merger –Summary of Lazard Financial Analyses”
“The Merger – Certain Company Forecasts”
“Annex B: Opinion of Lazard Frères & Co.”
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated December 22, 2020 is attached hereto as Exhibit (c)(1) and
is incorporated by reference herein.
The Valuation Analysis of Lazard Frères & Co. presented
to the Board of Directors of Tribune Publishing Company dated December 30, 2020 is attached hereto as Exhibit (c)(2) and is incorporated
by reference herein.
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated January 14, 2021 is attached hereto as Exhibit (c)(3) and
is incorporated by reference herein.
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated February 5, 2021 is attached hereto as Exhibit (c)(4) and
is incorporated by reference herein.
The Presentation Materials of Lazard Frères & Co.
presented to the Special Committee of Tribune Publishing Company dated February 11, 2021 is attached hereto as Exhibit (c)(5) and
is incorporated by reference herein.
The Valuation Analysis of Lazard Frères & Co. presented
to the Special Committee of Tribune Publishing Company dated February 15, 2021 is attached hereto as Exhibit (c)(6) and is incorporated
by reference herein.
The reports, opinions or appraisals referenced in this Item
9 are filed herewith and will be made available for inspection and copying at the principal executive offices of Tribune during
its regular business hours by any interested holder of Common Stock or representative who has been designated in writing, and
copies may be obtained by requesting them in writing from Tribune at the email address provided under the caption “Where
You Can Find More Information” in the Proxy Statement, which is incorporated herein by reference.
ITEM 10. SOURCE AND AMOUNTS OF FUNDS OR OTHER CONSIDERATION
(a)–(b) Source of Funds; Conditions. The information
set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“The Merger – Financing of the Merger”
(c) Expenses. The information set forth in the Proxy
Statement under the following captions is incorporated herein by reference:
“Summary of Proposal 1 – Merger Proposal”
“Special Factors – Fees and Expenses”
(d) Borrowed Funds. None.
ITEM 11. INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a) Securities Ownership. The information set forth in
the Proxy Statement under the following captions is incorporated herein by reference:
“Security Ownership of Certain Beneficial Owners, Directors,
and Management"
“Important Additional Information Regarding the Purchaser
Group”
(b) Securities Transactions. The information set forth
in the Proxy Statement under the following captions is incorporated herein by reference:
“Transactions in Common Stock”
ITEM 12. THE SOLICITATION OR RECOMMENDATION
(d) Intent to Tender or Vote in a Going-Private Transaction.
The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary about the Special Meeting – Vote Required”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors –Purposes and Reasons of the Purchaser
Group for the Merger”
“The Merger Agreement – Parent Voting Agreement”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“The Merger – Background of the Merger”
(e) Recommendations of Others. The information set forth
in the Proxy Statement under the following captions is incorporated herein by reference:
“Summary about the Special Meeting – Vote Required”
“Questions and Answers about the Special Meeting and the
Merger”
“Special Factors –Purposes and Reasons of the Purchaser
Group for the Merger”
“The Merger Agreement – Parent Voting Agreement”
“Special Factors – Position of the Purchaser Group
as to the Fairness of the Merger”
“The Merger – Background of the Merger”
ITEM 13. FINANCIAL STATEMENTS
(a) Financial Statements. The audited financial statements
set forth in Tribune’s Annual Report on Form 10-K for the year ended December 27, 2020 are incorporated by reference herein.
The information set forth in the Proxy Statement under the following captions is incorporated herein by reference:
“Where You Can Find More Information”
(b) Pro Forma Information. Not applicable.
ITEM 14. PERSONS/ASSETS, RETAINED, EMPLOYED, COMPENSATED
OR USED
(a)–(b) Solicitations or Recommendations; Employees
and Corporate Assets. The information set forth in the Proxy Statement under the following captions is incorporated herein
by reference:
“Questions and Answers about the Special Meeting and the
Merger”
“The Special Meeting – Solicitation of Proxies;
Payment of Solicitation Expenses”
ITEM 15. ADDITIONAL INFORMATION
(b) Golden Parachute Compensation. The information set
forth in the Proxy Statement under the following caption is incorporated herein by reference:
“Proposal 2 – Merger Compensation Proposal –
Golden Parachute Compensation”
(c) Other Material Information. The information set forth
in the Proxy Statement, including all annexes thereto, is incorporated herein by reference.
ITEM 16. EXHIBITS
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Exhibit
No.
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Description
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(a)(1)
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Preliminary Proxy Statement of Tribune Publishing Company (incorporated by reference to the Schedule 14A filed concurrently with this Transaction Statement by Tribune Publishing Company with the SEC)
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(a)(2)
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Opinion of Lazard Frères & Co. to the Special Committee and Board of Directors of Tribune Publishing Company dated February 16, 2021 (incorporated by reference to Annex B of the Proxy Statement)
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(a)(3)
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Letter to Tribune Publishing Company Stockholders (incorporated by reference to the Proxy Statement)
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(a)(4)
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Notice of Special Meeting of Stockholders (incorporated by reference to the Proxy Statement)
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(a)(5)
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Form of Proxy Card (incorporated by reference to the Proxy Statement)
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(a)(6)
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Joint Press Release of Tribune Publishing Company, dated February 16, 2021 (filed as Exhibit 99.1 to Tribune Publishing Company’s Current Report on Form 8-K, filed February 17, 2021 and incorporated by reference)
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(c)(1)*
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Presentation Materials of Lazard Frères & Co. presented to the Special Committee of Tribune Publishing Company dated December 22, 2020
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(c)(2)*
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Valuation Analysis of Lazard Frères & Co. presented to the Board of Directors of Tribune Publishing Company dated December 30, 2020
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(c)(3)*
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Presentation Materials of Lazard Frères & Co. presented to the Special Committee of Tribune Publishing Company dated January 14, 2021
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(c)(4)*
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Presentation Materials of Lazard Frères & Co. presented to the Special Committee of Tribune Publishing Company dated February 5, 2021
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(c)(5)*
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Presentation Materials of Lazard Frères & Co. presented to the Special Committee of Tribune Publishing Company dated February 11, 2021**
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(c)(6)*
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Valuation Analysis of Lazard Frères & Co. presented to the Special Committee of Tribune Publishing Company dated February 15, 2021**
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(d)(1)
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Agreement and Plan of Merger, dated as of February 16, 2021, by and among Tribune Publishing Company, Tribune Enterprises, LLC and Tribune Merger Sub, Inc. (incorporated by reference to Annex A of the Proxy Statement)
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(f)(1)
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Section 262 of the Delaware General Corporation Law (incorporated by reference to Annex C of the Proxy Statement)
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* To be filed herewith.
** Such materials were distributed to the Special Committee
the following day and reflect certain immaterial updates.
SIGNATURES
After due inquiry and to the best of each of the undersigned’s
knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and
correct.
Dated as of March 23, 2021
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Tribune Publishing Company
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By:
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/s/ Terry Jimenez
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Name:
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Terry Jimenez
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Title:
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Chief Executive Officer
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Tribune Enterprises, LLC
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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Tribune Merger Sub, Inc.
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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Alden Global Capital LLC
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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Alden Global Opportunities Master Fund, L.P.
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By:
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Alden Global Capital LLC, its investment advisor
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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AGOF Master GP, Ltd.
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By:
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/s/ Philip Dickie
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Name:
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Philip Dickie
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Title:
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Director
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Alden Global Value Recovery Master Fund, L.P.
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By:
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Alden Global Capital LLC, its investment advisor
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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AGVRF Master GP, Ltd.
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By:
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/s/ Philip Dickie
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Name:
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Philip Dickie
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Title:
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Director
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Turnpike Limited
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By:
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Alden Global Capital LLC, its investment advisor
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By:
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/s/ Heath Freeman
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Name:
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Heath Freeman
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Title:
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President
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Heath Freeman
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/s/ Heath Freeman
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Heath B. Freeman
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Randall D. Smith
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/s/ Heath Freeman
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Randall D. Smith
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Exhibit (c)(1)
Project Crayola SPECIAL COMMITTEE DISCUSSION MATERIALS DECEMBER 2020 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT CRAYOLA CONFIDENTIAL 1
Proposed Terms – Amber to Acquire Teal PROJECT CRAYOLA Buyer Amber Global Capital, LLC (“Amber”) submitted an offer on 12/14/20 Amber owns 32% of Teal and a majority interest in the Media News Group (“MNG”) Price Per Share [$14.25] per Teal share, subject to limited due diligence Premium Amber noted it was a 32% premium to the 1 - year VWAP The offer is a 13% premium to the 12/18/20 closing price, a 20% premium to the price the day prior to the offer and a 14% premium to the price 4 - weeks prior to the offer Form of Consideration Cash Financing Amber stated it can fully finance the transaction ([~$365mm] for the 68% not already owned) with cash on hand at Amber and MNG (no third - party financing or financing conditions) Requested approval to discuss a joint transaction with Stewart Bainum , Jr. (the “Investor”). The offer is not contingent on a joint proposal with the Investor Will Amber Sell Its Stake? Amber has stated that it is not interested in selling its Teal stock to another party and has no intention to vote in its capacity as a stockholder in favor of any such non - Amber transaction Process Amber non - binding proposal conditioned on approval by a special committee and approval by a vote of two - thirds of the outstanding non - Amber shares 2
- 5.00 10.00 15.00 20.00 $25.00 Jan-19 May-19 Oct-19 Mar-20 Jul-20 Dec-20 Teal Stock Price Performance PROJECT CRAYOLA Share Price Evolution Since January 1, 2019 $12.60 / share on 12/18/20 ($2.00 of dividends / share paid since 1/1/19) 5/30/19 Teal declares a one - time dividend of $1.50 per share Source: FactSet, Company filings and publicly available sources. Historical stock prices shown are not adjusted for subsequent d ividends paid. Note: Market values as of December 18, 2020. 1/14/19 Gannett approached by Amber with hostile bid 8/5/19 Gannett and New Media announce merger 1/17/19 Teal CEO Dearborn to step down 11/14/19 Teal declares regular quarterly dividend of $0.25/share (ex - dividend on 11/25/19) 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 11/25/19 Amber files Schedule 13D noting its stake increased to 32% Low closing price of $5.50 (on 3/18/20) 12/2/19 Standstill agreement with Amber signed 2/3/20 Chairman and CEO change + removal of BestReviews Put / Call 2/19/20 Pre - COVID S&P 500 High; Teal declares quarterly dividend of $0.25 / share 7/28/20 Shareholder Rights Plan put into place, expiration on 7/27/21 7/2/20 Teal elects Randall Smith to Board of Directors 3/18/20 Mason Slaine acquires 6.9% stake Period (Actual Days) Price $14.25 Implied Premium Current $12.60 13.1% 52-Week Low 5.50 159.1% 52-Week High 13.33 6.9% 10 Day VWAP 12.32 15.7% 20 Day VWAP 12.30 15.9% 30 Day VWAP 12.33 15.6% 60 Day VWAP 12.31 15.8% 90 Day VWAP 12.09 17.9% 180 Day VWAP 10.41 36.9% 365 Day VWAP 10.03 42.0% 5/12/20 Teal suspends dividend 12/16/20 Teal to sell 100% of BestReviews to Nexstar for $160mm 3
(120%) (100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100% 120% 140% Jan-19 Feb-19 Apr-19 Jun-19 Aug-19 Sep-19 Teal Share Price Performance Relative to Peers PROJECT CRAYOLA Source: FactSet and Bloomberg. Note: Market values as of September 30, 2019 and December 18, 2020, respectively. 1 Stock closing price as of January 1, 2019. 2 Stock closing price as of September 30, 2019. Share Price Performance January 1, 2019 to September 30, 2019 NYT 27.8% S&P500 18.7% NWSA 22.6% LEE (3.3%) PF GCI (23.9%) Teal (24.3%) Teal¹ $11.34 SA GCI 25.9% Share Price Performance Since September 30, 2019 (120%) (100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100% 120% 140% Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 2/19/20 Pre - COVID S&P 500 High; Teal declares quarterly dividend of $0.25 / share Teal 2 $8.58 4
Teal (Street) Teal (Street) Comparables Benchmarking – Teal @ $12.60 / Share FV / 2019A EBITDA (w/ Pensions) PROJECT CRAYOLA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of December 18, 2020. 1 Pro forma for sale of BestReviews . Teal Mgmt. balance sheet as of Q4 2020. Teal Street balance sheet as of Q3 2020. 2 Current Net D ebt / 2020E EBITDA (EBITDA is Pre - SBC and the ratio is not adjusted for pensions). 3 Not shown due to lack of 2021E estimates. FV / 2020E EBITDA (w/ Pensions) 3.8x 4.1x 4.8x 5.1x 16.1x 30.1x FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) 2.5x 3.9x 4.5x NA 14.5x 24.2x 3 13.7% 11.8% 19.5% 7.8% 10.9% 13.4% 11.8% 15.8% 8.9% 9.7% 15.5% 13.4% NA 10.0% 11.1% — — 3.9x — 3.4x ’20E Net Leverage 3.6x 3.5x 3.8x 14.8x 28.8x FV / LTM EBITDA (w/ Pensions) 4.2x 5.0x 5.1x 15.8x 28.7x ’19A Margin ’20E Margin 9.5% ’21E Margin 15.4% Teal ( Mgmt ) 1 1 1 44.0% NA 26.6% 22.5% 18.4% % LTM Digital Revenue Teal 1 Teal Teal margins jump to the high - end of the comparable range in the Management C ase 1 1 — 2 5
Min Median Max Lee LTM¹ 3.9x 5.1x 5.6x SA GCI LTM 3.2x 3.7x 4.5x SA GCI NTM 3.3x 4.0x 5.2x PF GCI LTM 3.9x 4.7x 6.0x PF GCI NTM 3.1x 4.0x 4.7x 2.0 3.0 4.0 5.0 6.0 7.0x Jan-18 Aug-18 Mar-19 Oct-19 May-20 Dec-20 Lee LTM SA GCI LTM PF GCI LTM SA GCI NTM PF GCI NTM 5.0x Gannett and Lee EBITDA Multiples Since January 1, 2018 PROJECT CRAYOLA August 5, 2019 Gannett and New Media announce merger January 14, 2019 MNG announces hostile takeover bid November 19, 2019 New Media / Gannett merger closes May 16, 2019 Gannett shareholders reelect Gannett's independent director nominees after proxy fight with MNG Source: FactSet . Note: Market values as of December 18, 2020. Multiples reflect Adj. Firm Value incl. Pensions. 1 Forward looking projections for Lee not available. 3.0x January 28, 2020 Lee announces agreement to purchase Berkshire Hathaway's newspapers February 19, 2020 Market high before COVID - 19 6
2.0 3.0 4.0 5.0 6.0 7.0 8.0x Jan-19 May-19 Oct-19 Mar-20 Jul-20 Dec-20 NTM LTM Teal Analyst Price Targets and EBITDA Multiples PROJECT CRAYOLA Source: FactSet and Bloomberg. Note: Market values as of December 18, 2020. Multiples reflect Adj. Firm Value incl. Pensions. Teal NTM and LTM EBITDA Multiple Evolution (Since January 1, 2019) 5.0x 3.0x 5/30/19 Teal declares a one - time dividend of $1.50 per share Teal Analyst Price Targets Teal Analyst Commentary “Few companies in media came through the COVID - 19 unscathed ; but [ … ] Q 2 EBITDA significantly exceeded our expectation on better than expected revenue, 60 % owned Best Reviews saw revenue grow 37 % , digital subscriber growth increased 40 % to 419 , 000 , and the company continues to manage cash well . ” HUBER RESEARCH PARTNERS, 11 SEPTEMBER 2020 “The Teal shares trade at a modest 2 . 9 times enterprise value to proforma estimates . We believe that upside revenue and cash flow surprises and increasing contributions from its digital businesses would be among the key catalysts towards higher stock valuations . We would not rule out, however, other transformative acquisitions or return of capital strategies . ” NOBLE CAPITAL MARKETS, 17 DECEMBER 2020 Premium / Price Discount Broker Date Rating Target to Current Noble Capital Markets 12/17/2020 Buy 17.50 38.9% Huber Research Partners 9/11/2020 Buy 15.00 19.0% Cowen & Company Share Price (12/18/20) $12.60 – 52 Week High 13.33 5.8% 52 Week Low 5.50 (56.3%) No longer active 8/5/19 Gannett and New Media announce merger 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 1/14/19 Gannett approached by Amber with hostile bid 11/25/19 Amber files Schedule 13D noting its stake increased to 32% 12/2/19 Standstill agreement with Amber signed 11/14/19 Teal declares quarterly dividend of $0.25 per share (ex - dividend on 11/25/19) 2/3/20 Chairman and CEO change + removal of BestReviews Put / Call 2/19/20 Pre - COVID S&P 500 High, Teal declares quarterly dividend of 25 cents 7/2/20 Randall Smith elected to Board of Directors 7/28/20 Shareholder Rights Plan put into place, expiration on 7/27/21 12/16/20 Teal to sell 100% of BestReviews to Nexstar for $160mm 7
Teal At Market Illustrative Offer Price Share Price (12/18/2020) $12.60 $14.25 $15.00 $16.00 $17.00 $18.00 $19.00 $20.00 Implied Premium to Current 13.1% 19.0% 27.0% 34.9% 42.9% 50.8% 58.7% % Bump vs. $14.25 5.3% 12.3% 19.3% 26.3% 33.3% 40.4% FDSO 37.633 37.633 37.755 37.755 37.755 37.762 37.762 37.769 Fully Diluted Equity Value $474 $536 $566 $604 $642 $680 $717 $755 Less: Cash Proceeds from Options – – (2) (2) (2) (2) (2) (2) Equity Value $474 $536 $565 $602 $640 $678 $716 $753 Plus: Pensions 17 17 17 17 17 17 17 17 Less: Cash (219) (219) (219) (219) (219) (219) (219) (219) Firm Value $272 $334 $363 $400 $438 $476 $514 $552 FV / LTM Revenue ($793mm) 0.3x 0.4x 0.5x 0.5x 0.6x 0.6x 0.6x 0.7x FV / '19A EBITDA ($75mm) 3.6x 4.5x 4.8x 5.3x 5.8x 6.3x 6.8x 7.3x FV / LTM EBITDA ($65mm) 4.2x 5.1x 5.6x 6.1x 6.7x 7.3x 7.9x 8.4x FV / '20E EBITDA ($72mm) 3.8x 4.6x 5.0x 5.5x 6.1x 6.6x 7.1x 7.6x FV / '21E EBITDA - Street ($71mm) 3.8x 4.7x 5.1x 5.6x 6.2x 6.7x 7.2x 7.8x FV / '21E EBITDA ($109mm) 2.5x 3.1x 3.3x 3.7x 4.0x 4.4x 4.7x 5.1x Precedent Transactions ($ in millions, except per share data) Analysis at Various Prices PROJECT CRAYOLA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of December 18, 2020. Balance sheet as of Q4 2020 provided by Teal management. 1 Pro forma for sale of BestReviews . 2 Pro forma for sale of BestReviews . EBITDA shown after deducting stock - based compensation expense and adding back $2mm of pension expense. 3 Multiple reflects pensions of $293mm. 2019 / 2020 Newspaper Precedents – LTM EBITDA Multiples 4.8x 4.4x 3.6x 3.4x Precedent Premiums Paid By Minority Shareholders 0.5x 0.4x 0.6x 0.4x LTM Revenue 1 2 2 2 2 5.5x 3 8 data points over the last 10 years: ( i ) firm value of $500mm – $2bn, and (ii) acquiror ownership of target between 15% – 50% Mean and median premiums generally in the 20% – 30% range 4 of the 8 had “bumps” of 12.5% or less (4 had no bumps) 2 Acquiror Target Chatham Asset Mgmt. (Michael Ferro 25% stake) Page 13 has the complete list of precedents Date August 2019 November 2019 January 2020 July 2020 8
Voting Scenarios (Shares in millions) PROJECT CRAYOLA Amber Proposal Alternative Proposal Source: Teal Management, company filings and FactSet. 1 Showing the minimum number of public votes necessary for the relevant proposal to pass. 2 Assumes that 70% of the total public shares (non - PSS / Amber) participate in the vote. 3 PSS is assumed to vote in favor of the highest sale price proposal given he was understood to have had conversations with Amber and Slaine in July 2020 regarding a sale of his shares. 4 Basic shares outstanding only. Excludes options and RSUs. Shares % of Public Float (Voting) Voting Requirement 2/3 vote of the outstanding non - Amber shares (not by written consent) Majority of the outstanding voting stock Slaine and BestReviews Management hold 4.7mm shares All Vote 70% Vote All Vote 70% Vote Minimum Public - For1 7.909 7.909 9.559 9.559 Public - Against 8.326 3.456 6.676 1.805 Total Voting Public 16.235 11.364 16.235 11.364 PSS Shares - For3 8.744 8.744 8.744 8.744 Amber - Against NA NA 11.554 11.554 Total Voting 24.979 20.108 36.533 31.662 % in Favor 66.7% 82.8% 50.1% 57.8% Amber - For 11.554 11.554 – – Public Non-Voting Shares – 4.870 – 4.870 Total Shares Outstanding 4 36.533 36.533 36.533 36.533 % in Favor 77.2% 77.2% 50.1% 50.1% % in Favor (excl. Amber) 66.7% 66.7% – – Minimum Public - For 48.7% 69.6% 58.9% 84.1% Public - Against 51.3% 30.4% 41.1% 15.9% Total Voting Public 100.0% 100.0% 100.0% 100.0% 2 2 9
History of Strategic Discussions PROJECT CRAYOLA Timeline Description Summer 2018 Donerail discussions ( Donerail to buy Teal and sell - off the pieces); ultimately, Donerail never secured financing for a “bust - up” Fall 2018 Process to sell the company (rumors of the process made it into the press); led to McClatchy discussions which were terminated when McClatchy could not secure financing Winter / Spring 2019 Gannett discussions regarding a combination (Teal as buyer or seller) after Amber / MediaNews announced an unsolicited offer for Gannett; Gannett ultimately merged with New Media in November 2019 Spring 2019 McClatchy discussions regarding ( i ) a full combination, and (ii) the sale of Teal Florida to McClatchy; McClatchy could not secure financing and ultimately went through bankruptcy Summer / Fall 2019 Apollo discussions regarding financing for a special dividend; given Apollo’s positions in New Media / Gannett and Cox Broadcasting (which raised regulatory concerns), Apollo and Teal terminated discussions (after Apollo repeatedly revised the terms, making the loan smaller and more onerous to Teal) Fall 2019 Amber approached about a cash / stock merger between MediaNews and Teal; Ferro (as the largest Teal shareholder and company consultant) indicated he would support an all cash deal at $13 / share; Amber withdrew from the discussions November 2019 – March 2020 Amber acquired 32% of Teal without board approval (Delaware 203 not waived). Amber entered into a standstill on 12/2/19 and began discussing potential intercompany agreements between Amber - owned MediaNews and Teal (these talks were complicated by Delaware 203). In January 2020, Amber approached Teal for a standstill waiver in order to buy Patrick Soon - Shiong’s 25% stake in Teal for $13.50 per share (waiver was not granted). Amber made a private approach to the Teal board in February 2020 to acquire all of the Teal shares it did not own for $13.50 / share. These discussions were halted due to COVID - 19 disruptions Summer 2020 Teal understood that PSS had conversations with Amber and Slaine in July regarding a potential sale of his stake in Teal (this led to the adoption of the shareholder rights plan) 10
Tactical Considerations – Other Potential Bidders PROJECT CRAYOLA McClatchy Chatham acquired out of bankruptcy for $312mm on September 4 th , 2020 Wholly - owned by Chatham so financial capacity unclear Gannett Private Equity PSS has not indicated any interest in acquiring Teal (has been more focused on a sale of Teal shares) Historically, all of the individuals that expressed interest failed to secure financing (e.g., Donerail , Jeremy Albrecht) Mason Slaine filed a 13D in March stating that he owns 6.9% of Teal (since increased to 7.8%) and believed that the Company should pursue a sale of BestReviews and use the proceeds for a special dividend; unclear financial resources and ability to finance an all cash transaction Only Apollo expressed interest in equity - linked securities in recent years (terminated discussions in the Fall of 2019) Apollo provided all the Gannett debt financing ($1.8bn) Apollo regulatory issues given Gannett and Cox broadcasting Individual Investors Stock is trading at $ 2.55 / share ($373mm of equity) with $1.5bn of debt Any transaction likely to involve Teal holders taking equity (Gannett has net leverage today of ~3.5x) All stock combination reduces leverage to ~2.5x (before synergies); still ~2x with $100mm of synergies In an all stock merger Teal shareholders own >50% (even in an at - market merger at $12.60 / share) The Special Committee will need to decide on the appropriate process, considering: ( i ) the capacity of other potential bidders, (ii) the risk of leaks, (iii) how Amber may react to various tactical decisions, and (iv) the likely terms of the fiduciary - out provisions between signing and closing (for illustrative purposes only, a $15mm break fee is $0.40 / share and 0.1x of 2021 EBITDA) 11
CONFIDENTIAL Appendix PROJECT CRAYOLA
TEAL TEAL (Mgmt) (Street) Price per Share $12.60 $12.60 $2.55 $1.13 $17.35 $48.97 % 52 Week High 94.5% 94.5% 36.5% 51.6% 92.9% 95.9% Equity Value $474 $474 $373 $68 $10,371 $8,253 Plus: Debt – 7 1,484 538 1,284 – Plus: Minority Interest & Preferred Stock – – 4 2 6,717 2 Less: Cash (219) (222) (285) (34) (1,539) (816) Less: Investments (0) (0) (36) (6) (314) (22) Adj. Firm Value Mgmt Street $255 $258 $1,541 $568 $16,519 $7,418 2019A $73 $73 3.5x 3.5x 3.4x 3.4x 14.6x 29.9x LTM 64 64 4.0 4.1 4.8 4.5 15.6 29.8 2020E 70 66 3.6 3.9 4.7 4.5 15.9 31.4 2021E 107 69 2.4 3.7 4.4 NA 14.4 24.8 Adj. Firm Value w Pension Obligation $272 $278 $1,658 $644 $16,713 $7,668 2019A $75 $75 3.6x 3.7x 3.5x 3.8x 14.8x 28.8x LTM 65 65 4.2 4.3 5.0 5.1 15.8 28.7 2020E 72 68 3.8 4.1 4.8 5.1 16.1 30.1 2021E 109 71 2.5 3.9 4.5 NA 14.5 24.2 '19A - '21E Revenue CAGR (14.2%) (14.2%) (13.3%) NA (8.2%) 3.2% '19A - '21E EBITDA CAGR 20.2% (2.8%) (12.4%) NA (7.7%) 9.7% '19A EBITDA Margin (post-SBC) 7.8% 7.8% 10.9% 19.5% 11.8% 13.7% '20E EBITDA Margin (post-SBC) 9.5% 8.9% 9.7% 15.8% 11.8% 13.4% '21E EBITDA Margin (post-SBC) 15.4% 10.0% 11.1% NA 13.4% 15.5% Dividend Yield – – – – 1.2% 0.5% % Digital Revenue (LTM) 22.5% 22.5% 18.4% 26.6% NA 44.0% Selected Public Comparables ($ in millions, except per share values) APPENDIX PROJECT CRAYOLA Public Comparables – News Media 4 3 5 2 Source: Company filings, FactSet and Wall Street research. Note: Market values as of December 18, 2020. EBITDA shown on a Post - SBC basis. 1 Balance Sheet as of Q4 2020 per Teal Management. Figures are pro forma for the sale of BestReviews . 2 Balance sheet based on Q3 2020 public filings. Teal Street EBITDA numbers are based on broker projections. Figures are pro fo rma for the sale of BestReviews . 3 Pro forma for the repayment of $647mm of term loan debt using $497mm in proceeds from newly issued convertible notes, $135mm of real estate sales and $15mm of cash announced on December 17 , 2020. Digital revenue percentage computed on a pro forma basis for merger with New Media. 4 EBITDA includes 50% of TNI / MNI EBITDA (which is not consolidated for GAAP). 5 Pension expense of $2mm added back to EBITDA and $17mm pension obligation added to Adj. Firm Value (for Teal). 6 Teal Mgmt. and Teal Street LTM figures inclusive of BestReviews . News Corp does not fully disclose digital revenues. 1 5 5 6 5 5 5 5 5 12
11.4x 35.2x 8.5x 6.3x 5.0x 4.7x 3.5x 5.6x 4.6x 4.3x NA 5.5x 7.0x 4.0x 5.0x 4.0x 4.8x 4.4x 3.6x 3.4x 0.4x 2.5x 1.2x NA 0.6x 0.4x 0.2x 1.2x 1.1x 0.7x NA 0.6x NA NA 0.5x NA 0.6x 0.4x 0.4x 0.5x 2.0 4.0 6.0 8.0 10.0 12.0x LTM EBITDA Multiple LTM Revenue Multiple 3.5x Precedent Newspaper Publishing Transaction Multiples ($ in millions) PROJECT CRAYOLA Newspaper Publishing Transaction Multiples Source: Company filings, FactSet and Wall Street Research. Note: Precedent transactions exclude deals where financial terms were not disclosed. 1 EBITDA multiple is affected by Washington Post Co. agreeing to fund the pension obligations of retirees and pay Bezos a sum e q ual to the current staff’s projected benefits plus $50mm. 2 Multiple based on Adjusted Operating Profit. 3 Includes assumption of $90mm in pension obligations. 4 Represents EV/NTM multiple, not including $10mm of immediately available synergies (4.7x with immediately available synergies ) a t time of announcement and 3.3x using full run - rate synergies. 5 Multiples reflect last public offer price of $15.00 per share. 6 Multiples reflect last rumored offer price of $18.75 per share. 7 Multiple reflects pensions of $293mm. 8 Implied Firm Value based on $13.00 per share and net debt of ($88mm) as of Q3 2019. Multiples calculated using TPCO LTM figur es as of Q3 2019. 9 EBITDA multiple reflects a deduction of $8mm in lease payments to Berkshire Hathaway. 10 2020E revenue and EBITDA per management filing utilized as proxy for LTM figures. 1 4 2 Ann. Date Aug ’13 Jul ’15 Feb ’18 Dec ’11 Dec ’11 May ’12 Aug ’13 Jul ’14 Nov ’14 Feb ’15 May ’15 Oct ’15 Dec ’15 Nov ’16 Cancelled Aug ’17 Aug ’19 Nov ’19 Jan ’20 Jul ’20 Firm Value $250 $1,310 $590 $200 $140 $142 $70 $529 $280 $102 $114 $280 $140 $20 $869 / $1,012 $120 $1,571 $442 $140 $312 Target Las Vegas Review Harris Acquiror Jeff Bezos Patrick Soon - Shiong John Henry News & Media Capital Chatham Asset Mgmt (63 Newspapers) APPENDIX 5.8x 6 5 0.6x 6 5 3 & 8 Median: 0.6x Median: 4.7x (Michael Ferro 25% stake) 5.5x 9 5.5x 7 7 = High / Low Reference Range 4 10 0.0 13
Precedent Premiums Paid By Minority Shareholders Over The Last 10 Years: ( i ) FV $500mm - $2.0bn, and (ii) Acquiror Ownership of Target Between 15% - 50% ($ in millions, except per share values) APPENDIX PROJECT CRAYOLA Source: Thomson SDC, company filings and publicly available news sources. Note: Transactions announced between January 1, 2010 and December 18, 2020. 1 $28.34 in cash and stock (also offered $26.06 in cash). 2 Brookfield submitted letter on 4/29/15 confirming $150mm investment and intent to propose tender offer for 100% of outstandin g c ommon stock (no offer price specified). 3 Initial exchange ratio of 0.72x. Final exchange ratio of 0.75x. Exchange ratio increase did not offset decline in acquiror stock price. Bump based on change in the ratio. Transactions with Existing Acquiror Ownership Undisturbed Ann. Closing Firm Acq. % Target Ownership Initial Offer Final Offer Memo: Date Date Date Target Acquiror Value Pre Post 1-Day Prior 4-Wk Prior 1-Day Prior 4-Wk Prior Initial Offer Final Offer # of Bumps % Bump 02/12/19 04/29/19 05/01/19 Coty JAB Cosmetics $1,748 40.1% 60.0% 20.6% 59.8% 20.6% 59.8% $11.65 $11.65 – – 11/09/18 05/22/19 10/18/19 International Speedway NASCAR Holdings 1,167 39.5% 100.0% 6.3% 17.8% 13.9% 26.2% $42.00 $45.00 1 7.1% 01/02/18 01/02/18 04/26/18 Archrock Partners Archrock 1,959 41.3% 100.0% 23.4% 31.4% 23.4% 31.4% $14.70 $14.70 – – 07/06/17 07/06/17 12/29/17 HSN Liberty Interactive 1,757 38.2% 100.0% 28.9% 27.5% 28.9% 27.5% $40.36 $40.36 – – 10/26/15 12/21/15 06/23/16 Northern Tier Energy Western Refining 1,737 38.4% 100.0% 14.0% 20.0% 17.0% 23.1% $27.62 $28.34 1 2.6% 04/29/15 05/18/15 08/17/15 GrafTech International Brookfield Asset Management 1,054 21.9% 100.0% NA NA 14.3% 28.8% NA $5.05 – NA 06/11/13 10/31/13 11/01/13 Dole Food Co Investor Group 1,018 37.6% 100.0% 17.6% 7.5% 32.4% 21.0% $12.00 $13.50 1 12.5% 03/25/11 07/11/11 11/30/11 Encore Energy Partners Vanguard Natural Resources 764 46.0% 100.0% 0.2% 1.3% (5.2%) (4.2%) $23.20 $21.94 1 4.2% Median: $1,452 39.0% 100.0% 17.6% 20.0% 18.8% 26.9% Mean: 1,400 37.9% 95.0% 15.9% 23.6% 18.2% 26.7% 2 2 1 3 3 14
# Shareholder Ownership Stake and Cumulative Holdings Current Market Value 1yr ∆ in % O/S Total Ownership Breakdown 1 1 Amber Global Capital $146 (0.4%) 2 Patrick Soon - Shiong 110 (0.3%) 3 Mason Slaine 36 +7.8% 4 BestReviews 24 (0.1%) 5 Dimensional Holdings 20 +0.3% 6 Morgan Stanley 15 +3.0% 7 BlackRock 15 (0.4%) 8 Renaissance Technologies 11 +0.3% 9 BrightSphere Investment Group 10 (0.2%) Top 10 Shareholder Concentration Evolution 10 Vanguard 9 (1.0%) 11 State Street 7 +0.5% 12 Northern Trust 5 +0.4% 13 Geode Holdings Trust 4 -- 14 Grantham, Mayo, Van Otterloo & Co. 3 +0.1% 15 Quinn Opportunity Partners 3 -- 16 Arrowstreet Capital 3 +0.1% 17 Timothy Knight 3 +0.4% 18 PRIMECAP Management 3 (5.5%) 19 Terry Jimenez 2 +0.2% 20 Charles Schwab 2 +0.1% 21 Jacobs Levy Equity Management 2 +0.1% 22 David Dreier 2 -- 23 GFH HFEVA 1 +0.1% 24 Credit Suisse 1 (0.1%) 25 AXA SA 1 +0.3% Teal's Top 25 Shareholders ($ in millions) 23.9% 7.8% 5.2% 4.2% 3.2% 3.2% 2.4% 2.1% 2.0% 1.5% 1.0% 0.8% 0.7% 0.7% 0.6% 0.6% 0.6% 0.5% 0.4% 0.4% 0.4% 0.3% 0.3% 0.3% 31.6% 55.6% 63.4% 68.6% 72.9% 76.1% 79.3% 81.7% 83.8% 85.8% 87.3% 88.3% 89.1% 89.8% 90.4% 91.1% 91.7% 92.2% 92.7% 93.1% 93.5% 93.9% 94.2% 94.5% 94.7% Top 5 Top 10 Top 15 Top 20 Top 25 Source: FactSet as per most recent filings. Note: Market pricing as of December 18, 2020. Ownership stake based on basic shares outstanding, consolidated across funds. One - year prior date of December 31, 2019, and five - year prior date of December 31, 2015. 1 Reflects entire shareholder base, not just top 25 shareholders, as per FactSet holdings information. PROJECT CRAYOLA APPENDIX Insider 40% Passive 8% Active 52% 72.9% 85.8% 71.6% 83.7% 48.5% 67.7% 1 2 3 4 5 6 7 8 9 10 Shareholder # Cumulative % O/S Today 1 Year ago 5 Years ago 15
APPENDIX PROJECT CRAYOLA Source: Teal Management and Public Filings. Note: Market values as of December 18, 2020. Balance sheet as of Q3 2020 for Gannett and Q4 2020 for Teal. 1 Based on illustrative $14.25 per share offer. 2 EBITDA adds back pension expense of $15mm for Gannett and $2mm for Teal. Gannett Merger with Teal @ $14.25 Per Share (All Stock) ($ in millions, except per share values) SQ SQ Pro Forma Gannett Teal @ $14.25 Price / Share $2.55 $14.25 $2.55 (x) FDSO 146.5 37.6 356.8 Fully Diluted Equity $373 $536 $910 (-) Options Proceeds – – – Equity Value $373 $536 $910 Debt $1,484 – $1,484 Minority Interest 4 – 4 Investments (36) (0) (36) Cash (285) (219) (504) Firm Value w/o Pension $1,541 $317 $1,858 2020E Adj. EBITDA (post-SBC) $328 $70 $398 2020E Adj. EBITDA (pre-SBC) 356 76 432 FV / 2020E Adj. EBITDA (post-SBC) 4.7x 4.5x 4.7x Debt / 2020E Adj. EBITDA (pre-SBC) 4.2 – 3.4 Net Debt / 2020E Adj. EBITDA (pre-SBC) 3.4 – 2.3 Pensions $117 $17 $134 Firm Value w/ Pension $1,658 $334 $1,992 2020E Adj. EBITDA (post-SBC) $343 $72 $416 2020E Adj. EBITDA (pre-SBC) 371 77 449 FV / 2020E Adj. EBITDA (post-SBC) 4.8x 4.6x 4.8x Debt / 2020E Adj. EBITDA (pre-SBC) 4.3 0.2 3.6 Net Debt / 2020E Adj. EBITDA (pre-SBC) 3.5 – 2.5 1 2 2 Teal owns 59% At $12.60 / share Teal has a $474mm market cap; so an at - market exchange would give Teal 56% of the combined company 16
Currently holds a 7.8% stake in Teal, and is the third largest shareholder of the company Chairman of technology firm Cast & Crew Currently sits on the board of Reorg Inc. and Cetara LLC. Slaine is also executive chairman of information services firm MLM2 (Warburg committed $1bn in September 2020) and a principal investor in Varo Bank Former executive chairman of Interactive Data Corp., which was sold to the Intercontinental Exchange in 2015 Slaine was the President and CEO Investment Dealers’ Digest from 1982 – 1986, the chairman and CEO of Securities and Data Corp from 1987 – 1991, and involved with Thomson Financial from 1991 – 1994, when he became the President and CEO of Thomson Financial through 1996. Founded FT Media Holdings in 2005, with Warburg Pincus , which was acquired by Gannett in 2018 Slaine graduated from Amherst College and holds an M.B.A. from Harvard Business School Background On Relevant Individuals APPENDIX PROJECT CRAYOLA Chairman of Choice Hotels International since October 1998 Served as chairman and CEO of Manor Care until 1998, when it merged with Health Care and Retirement Corp Founder of Somerford Place Corporation in 1998 and Artis Senior Living in 2012 Politically involved and served as a senator in the Maryland General Assembly from 1979 to 1987, where he was a member of each House’s budget and tax committee . Bainum has remained active in Democratic politics and served as a delegate to the Democratic Conventions in 1984, 1992 and 2008 Currently a member of both the Real Estate Roundtable and the Board of Advisors of UCLA’s Anderson School of Business Bainum graduated from Pacific Union College and holds an M.B.A. from the UCLA Anderson School of Management. Bainum also holds a theology degree from Andrews University Stewart Bainum , Jr. Mason Slaine Source: FactSet and publicly available news sources. 17
Exhibit (c)(2)
Project Crayola SPECIAL COMMITTEE DISCUSSION MATERIALS DECEMBER 2020 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT CRAYOLA CONFIDENTIAL 1
Table of Contents PROJECT CRAYOLA CONFIDENTIAL I INTRODUCTION 2 II BUSINESS PLAN 3 III VALUATION 7 IV NEXT STEPS 10 APPENDIX A Appendix – Public Comparables 15 B Appendix – Precedent Transactions 21 C Appendix – Business Plan 24 D Appendix – DCF 30 E Appendix – WACC 36 F Appendix – Other Potential Parties 39 G Appendix – Teal Shareholders 43
CONFIDENTIAL I Introduction PROJECT CRAYOLA
Introduction I INTRODUCTION PROJECT CRAYOLA Last week, on December 22, the Special Committee met to review: The terms of the Amber proposal Public market benchmarks Precedent transaction benchmarks Teal history of strategic discussions Other potential counterparties On December 23, Lazard met with the Teal CEO to do due diligence on the Teal business and the projections Today, the Special Committee will review: Teal standalone business plans Initial views on Teal’s value Potential next steps 2
CONFIDENTIAL II Business Plan PROJECT CRAYOLA
Business Plan Overview II BUSINESS PLAN PROJECT CRAYOLA 2021 Board approved budget: $695mm of revenue and $111mm of EBITDA before stock - based compensation (“SBC”) expense $107mm of EBITDA after SBC versus $70mm in 2020 (margins rise to 15.4% versus 9.5% in 2020 ) Teal Q3 ’20 margin of 12.3% pro forma for the sale of BestReviews and after deducting SBC expense Historical and forecasted results exclude the financial impact of BestReviews Case A Case B 2022 and 2023 forecasts prepared at the request of the Special Committee (has not been reviewed by the Teal board) 2022 and 2023 revenues equal those used in Case B Margins decline to 13% in 2022 and 11% in 2023 – consistent with Gannett levels in 2019 and 2021 Teal % digital revenues (LTM), ’19A - ’21E revenue CAGR, EBITDA margins (2020) and capex / revenue ratio (2020) are consistent with Gannett’s comparable statistics (see page 28) 2022 and 2023 forecasts prepared by Teal Management (has not been reviewed by the Teal board) 2023 revenues are 4% below those in Case A (2022 revenues are slightly below Case A) Margins decline to 14% by 2023 Case C 2022 and 2023 forecasts prepared by Teal Management (has not been reviewed by the Teal board) Revenues continue to decline and margins rise to 18% by 2023 3
$143 $167 $167 $145 $169 $200 $230 $196 $220 $196 $220 $1,013 $865 $779 $599 $526 $453 $392 $449 $377 $449 $377 $1,156 $1,032 $946 $744 $695 $653 $622 $645 $597 $645 $597 - 200 400 600 800 1,000 1,200 $1,400 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E Digital Print Business Plan – Revenue & EBITDA ($ in millions) II BUSINESS PLAN PROJECT CRAYOLA Revenue Commentary ’21E - ’23E Print declines of 14% - 15% (CAGR) which are worse than ’17A - ’19A levels but better than ’19A - ’21E levels (23% decline in 2020) Digital growth driven by: ( i ) a recovery in digital advertising (recover to ’19A levels by ’22E / ’23E), and (ii) growth in digital circulation (subscriber and ARPU growth) Case A Case B Margins rise from 10% to 15% in ’21E (versus 11% for Gannett) Case A has margins rise to 18% in ’23E Case B has margins decline to 14% in ’23E (News Corp and NY Times level) Case C has margins decline to 11% in ’23E (Gannett levels) EBITDA (Post - SBC) $82 $80 $73 $70 $107 $110 $113 $102 $85 $84 $66 - 50 100 150 $200 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E Post - SBC EBITDA Margin 7.8% 7.1% 7.7% 9.5% 15.4% 16.9% 18.1% 15.8% 14.3% Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 1 1 1 1 Case C Case A Case B Case C 13.0% 11.0% $952 $1,074 $873 $674 $589 $543 $509 $543 $512 $557 $527 Operating Expenses FTE 3,821 3,109 2,479 2,217 2,106 2,300 2,191 – – NA NA (12.3%) (17.8%) (13.7%) (15.3%) (15.3%) 2 - Year Trailing Print CAGR Budget Budget 4
Unlevered Free Cash Flow ($ in millions) II BUSINESS PLAN PROJECT CRAYOLA Selected Free Cash Flow Items Budget Case A Case B Case C 2017A 1 2018A 1 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E Revenue $1,156 $1,032 $946 $744 $695 $653 $622 $645 $597 $645 $597 % Growth (10.7%) (8.4%) (21.3%) (6.6%) (6.1%) (4.7%) (7.3%) (7.5%) (7.3%) (7.5%) EBITDA (Post-SBC) $82 $80 $73 $70 $107 $110 $113 $102 $85 $84 $66 % Margin 7.1% 7.8% 7.7% 9.5% 15.4% 16.9% 18.1% 15.8% 14.3% 13.0% 11.0% Capex ($24) ($33) ($22) ($10) ($6) ($6) ($6) ($6) ($6) ($6) ($6) % Revenue (2.1%) (3.2%) (2.3%) (1.3%) (0.9%) (0.9%) (1.0%) (0.9%) (1.0%) (0.9%) (1.0%) Adjusted Expenses2 ($34) ($75) ($36) ($24) ($40) ($12) ($13) ($12) ($13) ($12) ($13) Taxes @ 28% $0 $13 ($5) ($13) ($19) ($27) ($27) ($24) ($19) ($19) ($13) Unlevered Free Cash Flow 3 $21 ($8) $25 $30 $49 $69 $71 $64 $53 $51 $38 % Revenue 1.8% (0.7%) 2.6% 4.1% 7.0% 10.6% 11.4% 10.0% 8.8% 7.9% 6.5% Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Extraordinary charges related to items such as restructuring charges. 3 See page 29 for comprehensive unlevered free cash flow calculation. 5
Cases A, B and C Versus Projections Prepared In February ($ in millions) II BUSINESS PLAN PROJECT CRAYOLA Revenue Capex EBITDA (Post - SBC) Unlevered Free Cash Flow $1,032 $946 $695 $653 $622 $645 $597 $859 $806 $762 $724 $738 $640 $1,156 $744 $695 500 600 700 800 900 1,000 1,100 $1,200 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 $110 $113 $70 $102 $85 $82 $80 $73 $107 $84 $66 $83 $75 $69 $64 $74 $77 50 60 70 80 90 100 110 $120 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 $69 $71 $30 $64 $53 $21 ($8) $25 $49 $51 $38 $42 $36 $38 $37 -20 - 20 40 60 80 $100 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Source: Teal Management and Wall Street research. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 1 Noble broker estimates reduced by BestReviews results ($53mm of revenue and $23mm of EBITDA in 2020E and 2021E). (20) $6 $10 $6 $24 $33 $22 $6 $13 $14 $8 - 10 20 30 $40 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Cases A, B, and C are equal Cases B and C are equal 2017 – 2019 Actual + 2020 Management Estimate + 2021 Budget February Case C Case B Case A Noble 1 6
CONFIDENTIAL III Valuation PROJECT CRAYOLA
Implied Share FV / 2020E Key Price Range Firm Value EBITDA (Post-SBC) Assumptions - Range consistent with current and historical trading levels for Teal, Gannett and Lee; current market values based on 12/24/20 prices - New York Times has 44% LTM digital revenue (versus 19% for Teal); News Corp has other businesses like broadcasting and publishing - Multiple range based on precedent transactions that have been executed since 2011 - Recent transactions (Gannett, Teal minority interest, Berkshire and McClatchy) ranged from 3.4x - 5.5x LTM EBITDA - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (11.2%) – (2.3%) with Teal revenue declining 4.7% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.9%) – (2.1%) with Teal revenue declining 7.5% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.5%) – (1.8%) with Teal revenue declining 7.5% in 2023 - High date: 12/26/2019 - Low date: 03/18/2020 - Current Amber offer value above 52-week high - Current Analyst Price Targets: - High: $17.50 (Noble: 12/17/20) - Low: $15.00 (Huber: 9/11/20) For Reference Only DCF Case A $250 – $363 4.5x – 6.5x$314 – $460 $392 – $586 5.6x – 8.3x Analyst Price Targets 0.1x – 4.2x 52-Week High / Low $5 – $301 $364 – $459 5.0x – 6.4x DCF Case C DCF Case B 3.6x – 5.2x Trading Comparables $217 – $361 3.0x – 5.0x Precedent Transactions $253 – $397 3.5x – 5.5x $5.50 $12.44 $14.13 $16.19 $12.05 $11.09 $13.32 $15.42 $17.99 $21.29 $15.86 $14.91 Teal – Summary Financial Analysis ($ in millions, except per share values) III VALUATION PROJECT CRAYOLA Source: Bloomberg, company filings, FactSet, Thomson SDC and Wall Street research. DCFs based on Teal Case A, Case B, and Case C projections. Note: Values shown exclude upside from New Jersey real estate and IP addresses (Teal Management suggested these could be $30mm, or $0.79 / share, of additional value). 1 Based on $70mm of post - SBC EBITDA in 2020 (multiples adjusted for pensions). $15.00 Huber $17.50 Noble Teal Valuation Summary Amber Initial Offer $14.25 1 7
III VALUATION PROJECT CRAYOLA Source: Company filings, FactSet and Wall Street research. Note: Market values as of December 24, 2020. 1 Metrics per Teal Management. Post - SBC EBITDA has $2mm of pension expense added back. 2 Pro forma for sale of BestReviews . Teal Mgmt. balance sheet as of Q4 2020. Teal Street balance sheet as of Q3 2020. 3 Current Net Debt / 2020E EBITDA (EBITDA is Pre - SBC and the ratio is not adjusted for pensions). 4 Multiple reflects pensions of $293mm. Implied Teal Prices – Public Comparables & Precedent Transactions ($ in millions, except per share values) Illustrative Valuation Reference Range Reference Range Low High Low High Teal Current Share Price $12.75 $12.75 $12.75 $12.75 Premium / (Discount) (13.0%) 17.0% (5.5%) 24.4% Implied Equity Value Per Share $11.09 $14.91 $12.05 $15.86 FDSO 37.770 37.890 37.770 37.890 Fully Diluted Equity Value $419 $565 $455 $601 (-) Cash Proceeds from Options – 2 – 2 Equity Value $419 $563 $455 $599 Plus: Total Debt – – – – Plus: Pensions 17 17 17 17 Less: Cash and Equivalents (219) (219) (219) (219) Less: Investments (0) (0) (0) (0) Implied Firm Value $217 $361 $253 $397 FV / EBITDA (post-SBC) Metric 2020E $72 3.0x 5.0x 3.5x 5.5x 2021E 109 2.0 3.3 2.3 3.7 Implied Multiple of Revenue Metric 2020E $744 0.3x 0.5x 0.3x 0.5x 2021E 695 0.3 0.5 0.4 0.6 Public Comparables Precedents Selected ranges based on Appendix Tab A and Tab B 1 1 FV / 2020E EBITDA (w/ Pensions) Teal (Street) 3.9x 4.2x 5.0x 5.1x 16.4x 31.6x Teal ( Mgmt ) 13.4% 11.8% 15.8% 8.9% 9.7% — — 3.9x — 3.8x ’20E Margin 9.5% 2 2 — ’20E Net Leverage 3 2019 / 2020 Newspaper Precedents – LTM EBITDA Multiples 4.8x 4.4x 3.6x 3.4x 0.5x 0.4x 0.6x 0.4x LTM Revenue 5.5x 4 Acquiror Target Chatham Asset Mgmt. (Michael Ferro 25% stake) Page 21 has the complete list of precedents Date August 2019 November 2019 January 2020 July 2020 8
Discounted Cash Flow Analysis III VALUATION PROJECT CRAYOLA Source: DCFs based on Teal Case A, Case B and Case C projections. Note: Values shown exclude upside from New Jersey real estate and IP addresses (Management suggested these could be $30mm, $0.79 / share, of additional value here). Price / Share Implied Perp. Growth Rate Implied Share Price At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x $14.52 $15.39 $16.25 $17.12 $17.99 14.42 15.27 16.13 16.98 17.84 14.32 15.16 16.01 16.85 17.69 14.22 15.06 15.89 16.72 17.55 14.13 14.95 15.77 16.59 17.41 Implied PGR At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x (10.9%) (8.5%) (6.6%) (5.1%) (3.9%) (10.5%) (8.1%) (6.2%) (4.7%) (3.4%) (10.1%) (7.7%) (5.8%) (4.2%) (3.0%) (9.7%) (7.2%) (5.3%) (3.8%) (2.5%) (9.2%) (6.8%) (4.9%) (3.4%) (2.1%) Implied Share Price At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x $12.74 $13.41 $14.08 $14.75 $15.42 12.66 13.32 13.98 14.64 15.30 12.59 13.24 13.89 14.54 15.19 12.51 13.15 13.80 14.44 15.08 12.44 13.07 13.71 14.34 14.97 Implied PGR At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x (10.5%) (8.2%) (6.3%) (4.8%) (3.6%) (10.1%) (7.7%) (5.9%) (4.4%) (3.2%) (9.7%) (7.3%) (5.5%) (4.0%) (2.7%) (9.3%) (6.9%) (5.0%) (3.5%) (2.3%) (8.9%) (6.5%) (4.6%) (3.1%) (1.8%) Case A Case B Case C Teal revenue declining 4.7% in 2023 Teal revenue declining 7.5% in 2023 Teal revenue declining 7.5% in 2023 Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $16.70 $17.84 $18.99 $20.14 $21.29 9.5% 16.57 17.70 18.83 19.96 21.10 10.0% 16.44 17.56 18.67 19.79 20.91 10.5% 16.31 17.41 18.52 19.62 20.72 11.0% 16.19 17.28 18.36 19.45 20.54 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.2%) (8.8%) (6.9%) (5.3%) (4.1%) 9.5% (10.8%) (8.3%) (6.4%) (4.9%) (3.6%) 10.0% (10.4%) (7.9%) (6.0%) (4.5%) (3.2%) 10.5% (10.0%) (7.5%) (5.6%) (4.0%) (2.8%) 11.0% (9.6%) (7.1%) (5.2%) (3.6%) (2.3%) 9
CONFIDENTIAL IV Next Steps PROJECT CRAYOLA
Proposed Terms – Amber to Acquire Teal IV NEXT STEPS PROJECT CRAYOLA Buyer Amber Global Capital, LLC (“Amber”) submitted an offer on 12/14/20 Amber owns 32% of Teal and a majority interest in the MediaNews Group (“MNG”) Price Per Share [$14.25] per Teal share, subject to limited due diligence Premium Amber noted it was a 32% premium to the 1 - year VWAP The offer is a 12% premium to the 12/24/20 closing price, a 20% premium to the price the day prior to the offer and a 14% premium to the price 4 - weeks prior to the offer Form of Consideration Cash Financing Amber stated it can fully finance the transaction (~$374mm for the 68% not already owned) with cash on hand at Amber and MNG (no third - party financing or financing conditions) Requested approval to discuss a joint transaction with Stewart Bainum , Jr. (the “Investor”). The offer is not contingent on a joint proposal with the Investor Will Amber Sell Its Stake? Amber has stated that it is not interested in selling its Teal stock to another party and has no intention to vote in its capacity as a stockholder in favor of any such non - Amber transaction Process Amber non - binding proposal conditioned on approval by a special committee and approval by a vote of two - thirds of the outstanding non - Amber shares 10
Next Steps – Significant Transaction Issues IV NEXT STEPS PROJECT CRAYOLA Price [$X] / share Based on 2021 multiple of EBITDA (board approved budget) Confirm no financing contingencies / request evidence of financial capacity Market Check Diligence Request by Amber for sanctioned discussions (including confirmation under rights plan) NDA to be entered into (including standstill) Amber stated it has limited diligence needs When to start the process (e.g ., not before an understanding on price )? New NDA to be entered into (discuss standstill) Bainum Potential to approach others? Any Amber 13D update would be public Break fee level Go shop versus traditional fiduciary - out Voting agreement(s) 11
Precedent Processes: Acquisitions by Minority Shareholders IV NEXT STEPS PROJECT CRAYOLA Last week we reviewed 8 precedents from the last 10 years (minority shareholders acquire control) 1 Did not consider GP / LP transactions ( Archrock , Encore Energy and Northern Tier), a two - step planned acquisition ( GrafTech ) or NASCAR / International Speedway (under common control of the France Family) Leaves three transactions (from the list reviewed last week): Coty, HSN and Dole JAB made a tender offer to increase its stake from 40% to 60% of Coty at a 25% premium to the price a day prior to the offer (51% premium to the 30 - day VWAP per the SEC filings); HSN and Dole were acquisitions of all the public shares Dole HSN Merger Announcement Date 8/11/13 7/6/17 First Proposal To Merger Signing ~ 2 Months ~ 1.5 months Public Initial Offer Yes No Form of Consideration Cash Stock Initial Bid Ask Spread $12 – $14 / share (17% gap) 1.735x – 1.79x ratio (3% gap); 1.60x – 1.70x (6% gap post diligence) Buyer Bumps 4 1 Final Price $13.50 / share 1.65x Total Move (Initial to Final) 12.5% 3.1% Premium to Undisturbed 32% 29% Go Shop Yes 2 No Source: Company Filings. 1 $500mm – $2bn of firm value. 2 Other parties expressed interest at $13 – $14 / share prior to signing (but the go - shop expired with no definitive offers). 12
Teal w/ Pensions Teal w/o Pensions At Market Illustrative Offer Price At Market Illustrative Offer Price Share Price (12/24/2020) $12.75 $14.25 $15.00 $16.00 $17.00 $18.00 $19.00 $20.00 $12.75 $14.25 $15.00 $16.00 $17.00 $18.00 $19.00 $20.00 Implied Premium to Current 11.8% 17.6% 25.5% 33.3% 41.2% 49.0% 56.9% 11.8% 17.6% 25.5% 33.3% 41.2% 49.0% 56.9% % Bump vs. $14.25 5.3% 12.3% 19.3% 26.3% 33.3% 40.4% 5.3% 12.3% 19.3% 26.3% 33.3% 40.4% FDSO 37.770 37.770 37.890 37.890 37.890 37.897 37.897 37.904 37.770 37.770 37.890 37.890 37.890 37.897 37.897 37.904 Fully Diluted Equity Value $482 $538 $568 $606 $644 $682 $720 $758 $482 $538 $568 $606 $644 $682 $720 $758 Less: Cash Proceeds from Options – – (2) (2) (2) (2) (2) (2) – – (2) (2) (2) (2) (2) (2) Equity Value $482 $538 $567 $604 $642 $680 $718 $756 $482 $538 $567 $604 $642 $680 $718 $756 Plus: Pensions 17 17 17 17 17 17 17 17 – – – – – – – – Less: Cash (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) Firm Value $280 $336 $365 $403 $441 $478 $516 $554 $263 $319 $348 $386 $424 $461 $499 $537 FV / LTM Revenue ($793mm / $793mm) 0.4x 0.4x 0.5x 0.5x 0.6x 0.6x 0.7x 0.7x 0.3x 0.4x 0.4x 0.5x 0.5x 0.6x 0.6x 0.7x FV / '19A EBITDA ($75mm / $73mm) 3.7x 4.5x 4.9x 5.4x 5.9x 6.4x 6.9x 7.4x 3.6x 4.4x 4.7x 5.3x 5.8x 6.3x 6.8x 7.3x FV / LTM EBITDA ($65mm / $64mm) 4.3x 5.2x 5.6x 6.2x 6.7x 7.3x 7.9x 8.5x 4.1x 5.0x 5.5x 6.1x 6.7x 7.3x 7.9x 8.5x FV / '20E EBITDA ($72mm / $70mm) 3.9x 4.7x 5.1x 5.6x 6.1x 6.6x 7.2x 7.7x 3.7x 4.5x 4.9x 5.5x 6.0x 6.5x 7.1x 7.6x FV / '21E EBITDA - Street ($71mm / $69mm) 3.9x 4.7x 5.1x 5.7x 6.2x 6.7x 7.3x 7.8x 3.8x 4.6x 5.0x 5.6x 6.1x 6.7x 7.2x 7.7x FV / '21E EBITDA ($109mm / $107mm) 2.6x 3.1x 3.4x 3.7x 4.1x 4.4x 4.8x 5.1x 2.5x 3.0x 3.3x 3.6x 4.0x 4.3x 4.7x 5.0x Multiples At Various Prices / Share ($ in millions, except per share data) IV NEXT STEPS PROJECT CRAYOLA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of December 24, 2020. Balance sheet as of Q4 2020 provided by Teal management. 1 Pro forma for sale of BestReviews . 2 Pro forma for sale of BestReviews . All EBITDA metrics are presented after deducting stock - based compensation expense. The first parameters shown have also been a djusted for a $2mm add back of pension expense. 1 2 2 2 2 2 13
Tactical Considerations – Other Potential Bidders IV NEXT STEPS PROJECT CRAYOLA McClatchy Chatham acquired out of bankruptcy for $312mm on September 4 th , 2020 Wholly - owned by Chatham so financial capacity unclear Gannett Private Equity PSS has not indicated any interest in acquiring Teal (has been more focused on a sale of Teal shares) Historically, all of the individuals that expressed interest failed to secure financing (e.g., Donerail , Jeremy Halbreich) Mason Slaine filed a 13D in March stating that he owns 6.9% of Teal (since increased to 7.8%) and believed that the Company should pursue a sale of BestReviews and use the proceeds for a special dividend; unclear financial resources and ability to finance an all cash transaction Only Apollo expressed interest in equity - linked securities in recent years (terminated discussions in the Fall of 2019) Apollo provided all the Gannett debt financing ($1.8bn) Apollo regulatory issues given Gannett and Cox B roadcasting investments Individual Investors Stock is trading at $2.75 / share ($399mm of equity) with $1.5bn of debt Any transaction likely to involve Teal holders taking equity (Gannett has net leverage today of ~3.5x) All stock combination reduces leverage to ~2.3x (before synergies); still ~2x with $100mm of synergies In an all stock merger Teal shareholders own >50% (even in an at - market merger at $12.75 / share) The Special Committee will need to decide on the appropriate process, considering: ( i ) the capacity of other potential bidders, (ii) the risk of leaks, (iii) how Amber may react to various tactical decisions, a nd (iv) the likely terms of the fiduciary - out provisions between signing and closing (for illustrative purposes only, a $15mm break fee is $0.40 / share and 0.1x of 2021 EBITDA) Note: Leverage ratios discussed above exclude pensions. 14
CONFIDENTIAL Appendix PROJECT CRAYOLA
CONFIDENTIAL A Appendix – Public Comparables PROJECT CRAYOLA
- 5.00 10.00 15.00 20.00 $25.00 Jan-19 May-19 Oct-19 Mar-20 Jul-20 Dec-20 Teal Stock Price Performance A APPENDIX – PUBLIC COMPARABLES PROJECT CRAYOLA Share Price Evolution Since January 1, 2019 $12.75 / share on 12/24/20 ($2.00 of dividends / share paid since 1/1/19) 5/30/19 Teal declares a one - time dividend of $1.50 per share Source: FactSet, Company filings and publicly available sources. Historical stock prices shown are not adjusted for subsequent d ividends paid. Note: Market values as of December 24, 2020. 1/14/19 Gannett approached by Amber with hostile bid 8/5/19 Gannett and New Media announce merger 1/17/19 Teal CEO Dearborn to step down 11/14/19 Teal declares regular quarterly dividend of $0.25/share (ex - dividend on 11/25/19) 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 11/25/19 Amber files Schedule13D noting its stake increased to 32% Low closing price of $5.50 (on 3/18/20) 12/2/19 Standstill agreement with Amber signed 2/3/20 Chairman and CEO change + removal of BestReviews Put / Call 2/19/20 Pre - COVID S&P 500 High; Teal declares quarterly dividend of $0.25 / share 7/28/20 Shareholder Rights Plan put into place, expiration on 7/27/21 7/2/20 Teal elects Randall Smith to Board of Directors 3/18/20 Mason Slaine acquires 6.9% stake 5/12/20 Teal suspends dividend 12/16/20 Teal to sell 100% of BestReviews to Nexstar for $160mm Period (Actual Days) Price $14.25 Implied Premium Current $12.75 11.8% 52-Week Low 5.50 159.1% 52-Week High 13.32 7.0% 10 Day VWAP 12.40 14.9% 20 Day VWAP 12.29 16.0% 30 Day VWAP 12.34 15.5% 60 Day VWAP 12.35 15.4% 90 Day VWAP 12.15 17.3% 180 Day VWAP 10.50 35.7% 365 Day VWAP 10.06 41.7% 15
(120%) (100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100% 120% 140% Jan-19 Feb-19 Apr-19 Jun-19 Aug-19 Sep-19 Teal Share Price Performance Relative to Peers A APPENDIX – PUBLIC COMPARABLES PROJECT CRAYOLA Source: FactSet and Bloomberg. Note: Market values as of September 30, 2019 and December 24, 2020, respectively. 1 Stock closing price as of January 1, 2019. 2 Stock closing price as of September 30, 2019. Share Price Performance January 1, 2019 to September 30, 2019 S&P500 18.7% NWSA 22.6% LEE (3.3%) PF GCI (23.9%) Teal (24.3%) Teal¹ $11.34 SA GCI 25.9% Share Price Performance Since September 30, 2019 (120%) (100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100% 120% 140% Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 2/19/20 Pre - COVID S&P 500 High; Teal declares quarterly dividend of $0.25 / share Teal 2 $8.58 NYT 27.8% 16
Teal (Street) Teal (Street) Comparables Benchmarking – Teal @ $12.75 / Share FV / 2019A EBITDA (w/ Pensions) A APPENDIX – PUBLIC COMPARABLES PROJECT CRAYOLA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of December 24, 2020. 1 Pro forma for sale of BestReviews . Teal Mgmt. balance sheet as of Q4 2020. Teal Street balance sheet as of Q3 2020. 2 Current Net Debt / 2020E EBITDA (EBITDA is Pre - SBC and the ratio is not adjusted for pensions). 3 Not shown due to lack of 2021E estimates. FV / 2020E EBITDA (w/ Pensions) 3.9x 4.2x 5.0x 5.1x 16.4x 31.6x FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) 2.6x 4.0x 4.7x NA 14.8x 25.3x 3 13.7% 11.8% 19.5% 7.8% 10.9% 13.4% 11.8% 15.8% 8.9% 9.7% 15.6% 13.4% NA 10.9% 11.1% — — 3.9x — 3.8x ’20E Net Leverage 3.7x 3.6x 3.9x 15.1x 30.3x FV / LTM EBITDA (w/ Pensions) 4.3x 5.1x 5.1x 16.1x 30.2x ’19A Margin ’20E Margin 9.5% ’21E Margin 15.4% Teal ( Mgmt ) 1 1 1 44.0% NA 26.6% 19.0% 18.4% % LTM Digital Revenue Teal 1 Teal Teal margins jump to the high - end of the comparable range in all cases 1 1 — 2 17
Min Median Max Lee LTM¹ 3.9x 5.1x 5.6x SA GCI LTM 3.2x 3.7x 4.5x SA GCI NTM 3.3x 4.0x 5.2x PF GCI LTM 4.1x 4.9x 6.2x PF GCI NTM 3.2x 4.1x 4.8x 2.0 3.0 4.0 5.0 6.0 7.0x Jan-18 Aug-18 Mar-19 Oct-19 May-20 Dec-20 Lee LTM SA GCI LTM PF GCI LTM SA GCI NTM PF GCI NTM 5.0x Gannett and Lee EBITDA Multiples Since January 1, 2018 A APPENDIX – PUBLIC COMPARABLES PROJECT CRAYOLA August 5, 2019 Gannett and New Media announce merger January 14, 2019 MNG announces hostile takeover bid November 19, 2019 New Media / Gannett merger closes May 16, 2019 Gannett shareholders reelect Gannett's independent director nominees after proxy fight with MNG Source: FactSet . Note: Market values as of December 24, 2020. Multiples reflect Adj. Firm Value incl. Pensions. 1 Forward looking projections for Lee not available. 3.0x January 28, 2020 Lee announces agreement to purchase Berkshire Hathaway's newspapers February 19, 2020 Market high before COVID - 19 18
2.0 3.0 4.0 5.0 6.0 7.0 8.0x Jan-19 May-19 Oct-19 Mar-20 Jul-20 Dec-20 NTM LTM Teal Analyst Price Targets and EBITDA Multiples A APPENDIX – PUBLIC COMPARABLES PROJECT CRAYOLA Source: FactSet and Bloomberg. Note: Market values as of December 24, 2020. Multiples reflect Adj. Firm Value incl. Pensions. Teal NTM and LTM EBITDA Multiple Evolution (Since January 1, 2019) 5.0x 3.0x 5/30/19 Teal declares a one - time dividend of $1.50 per share Teal Analyst Price Targets Teal Analyst Commentary “Few companies in media came through the COVID - 19 unscathed ; but [ … ] Q 2 EBITDA significantly exceeded our expectation on better than expected revenue, 60 % owned Best Reviews saw revenue grow 37 % , digital subscriber growth increased 40 % to 419 , 000 , and the company continues to manage cash well . ” HUBER RESEARCH PARTNERS, 11 SEPTEMBER 2020 “The Teal shares trade at a modest 2 . 9 times enterprise value to proforma estimates . We believe that upside revenue and cash flow surprises and increasing contributions from its digital businesses would be among the key catalysts towards higher stock valuations . We would not rule out, however, other transformative acquisitions or return of capital strategies . ” NOBLE CAPITAL MARKETS, 17 DECEMBER 2020 Premium / Price Discount Broker Date Rating Target to Current Noble Capital Markets 12/17/2020 Buy 17.50 37.3% Huber Research Partners 9/11/2020 Buy 15.00 17.6% Cowen & Company Share Price (12/24/20) $12.75 – 52 Week High 13.32 4.5% 52 Week Low 5.50 (56.9%) No longer active 8/5/19 Gannett and New Media announce merger 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 1/14/19 Gannett approached by Amber with hostile bid 11/25/19 Amber files Schedule 13D noting its stake increased to 32% 12/2/19 Standstill agreement with Amber signed 11/14/19 Teal declares quarterly dividend of $0.25 per share (ex - dividend on 11/25/19) 2/3/20 Chairman and CEO change + removal of BestReviews Put / Call 2/19/20 Pre - COVID S&P 500 High, Teal declares quarterly dividend of 25 cents 7/2/20 Randall Smith elected to Board of Directors 7/28/20 Shareholder Rights Plan put into place, expiration on 7/27/21 12/16/20 Teal to sell 100% of BestReviews to Nexstar for $160mm 19
Low High (Street) Price per Share $11.09 $14.91 $12.75 $2.75 $1.18 $17.82 $51.35 % 52 Week High 83.3% 112.0% 95.7% 39.3% 53.9% 95.4% 100.0% Equity Value $419 $563 $482 $399 $71 $10,636 $8,655 Plus: Debt – – 7 1,484 538 1,284 – Plus: Minority Interest & Preferred Stock – – – 4 2 6,786 2 Less: Cash (219) (219) (222) (254) (34) (1,539) (816) Less: Investments (0) (0) (0) (36) (6) (314) (22) Adj. Firm Value Mgmt Street $200 $344 $266 $1,597 $571 $16,853 $7,819 2019A $73 $73 2.7x 4.7x 3.6x 3.5x 3.4x 14.9x 31.5x LTM 64 64 3.1 5.4 4.2 5.0 4.5 15.9 31.4 2020E 70 66 2.8 4.9 4.0 4.9 4.5 16.3 32.9 2021E 107 70 1.9 3.2 3.8 4.6 NA 14.6 26.0 Adj. Firm Value w Pension Obligation $217 $361 $285 $1,714 $647 $17,047 $8,069 2019A $75 $75 2.9x 4.8x 3.8x 3.6x 3.9x 15.1x 30.3x LTM 65 65 3.3 5.5 4.4 5.1 5.1 16.1 30.2 2020E 72 68 3.0 5.0 4.2 5.0 5.1 16.4 31.6 2021E 109 72 2.0 3.3 4.0 4.7 NA 14.8 25.3 '19A - '21E Revenue CAGR (14.2%) (14.2%) (17.5%) (13.3%) NA (8.2%) 3.2% '19A - '21E EBITDA CAGR 20.2% 20.2% (2.4%) (12.4%) NA (7.7%) 10.0% '19A EBITDA Margin (post-SBC) 7.8% 7.8% 7.8% 10.9% 19.5% 11.8% 13.7% '20E EBITDA Margin (post-SBC) 9.5% 9.5% 8.9% 9.7% 15.8% 11.8% 13.4% '21E EBITDA Margin (post-SBC) 15.4% 15.4% 10.9% 11.1% NA 13.4% 15.6% Dividend Yield – – – – – 1.1% 0.5% % Digital Revenue (LTM) 19.0% 19.0% 19.0% 18.4% 26.6% NA 44.0% TEAL TEAL Selected Public Comparables ($ in millions, except per share values) A APPENDIX – PUBLIC COMPARABLES PROJECT CRAYOLA Public Comparables – News Media 4 3 5 2 Source: Company filings, FactSet and Wall Street research. Note: Market values as of December 24, 2020. EBITDA shown on a Post - SBC basis. 1 Balance Sheet as of Q4 2020 per Teal Management. Figures are pro forma for the sale of BestReviews . 2 Balance sheet based on Q3 2020 public filings. Teal Street EBITDA numbers are based on broker projections. Figures are pro fo rma for the sale of BestReviews . 3 Pro forma for the repayment of $647mm of term loan debt using $497mm in proceeds from newly issued convertible notes, $135mm of real estate sales and $15mm of cash announced on December 17, 2020. Digital revenue percentage computed on a pro forma basis for merger with New Media. 4 EBITDA includes 50% of TNI / MNI EBITDA (which is not consolidated for GAAP). 5 Pension expense of $2mm added back to EBITDA and $17mm pension obligation added to Adj. Firm Value (for Teal). 6 News Corp does not fully disclose digital revenues. 1 5 5 6 5 5 5 5 5 20
CONFIDENTIAL B Appendix – Precedent Transactions PROJECT CRAYOLA
11.4x 35.2x 8.5x 6.3x 5.0x 4.7x 3.5x 5.6x 4.6x 4.3x NA 5.5x 7.0x 4.0x 5.0x 4.0x 4.8x 4.4x 3.6x 3.4x 0.4x 2.5x 1.2x NA 0.6x 0.4x 0.2x 1.2x 1.1x 0.7x NA 0.6x NA NA 0.5x NA 0.6x 0.4x 0.4x 0.5x 2.0 4.0 6.0 8.0 10.0 12.0x LTM EBITDA Multiple LTM Revenue Multiple 3.5x Precedent Newspaper Publishing Transaction Multiples ($ in millions) PROJECT CRAYOLA Newspaper Publishing Transaction Multiples Source: Company filings, FactSet and Wall Street Research. Note: Precedent transactions exclude deals where financial terms were not disclosed. 1 EBITDA multiple is affected by Washington Post Co. agreeing to fund the pension obligations of retirees and pay Bezos a sum e q ual to the current staff’s projected benefits plus $50mm. 2 Multiple based on Adjusted Operating Profit. 3 Includes assumption of $90mm in pension obligations. 4 Represents EV/NTM multiple, not including $10mm of immediately available synergies (4.7x with immediately available synergies ) a t time of announcement and 3.3x using full run - rate synergies. 5 Multiples reflect last public offer price of $15.00 per share. 6 Multiples reflect last rumored offer price of $18.75 per share. 7 Multiple reflects pensions of $293mm. 8 Implied Firm Value based on $13.00 per share and net debt of ($88mm) as of Q3 2019. Multiples calculated using TPCO LTM figur es as of Q3 2019. 9 EBITDA multiple reflects a deduction of $8mm in lease payments to Berkshire Hathaway. 10 2020E revenue and EBITDA per management filing utilized as proxy for LTM figures. 1 4 2 Ann. Date Aug ’13 Jul ’15 Feb ’18 Dec ’11 Dec ’11 May ’12 Aug ’13 Jul ’14 Nov ’14 Feb ’15 May ’15 Oct ’15 Dec ’15 Nov ’16 Cancelled Aug ’17 Aug ’19 Nov ’19 Jan ’20 Jul ’20 Firm Value $250 $1,310 $590 $200 $140 $142 $70 $529 $280 $102 $114 $280 $140 $20 $869 / $1,012 $120 $1,571 $442 $140 $312 Target Las Vegas Review Harris Acquiror Jeff Bezos Patrick Soon - Shiong John Henry News & Media Capital Chatham Asset Mgmt (63 Newspapers) B APPENDIX – PRECEDENT TRANSACTIONS 5.8x 6 5 0.6x 6 5 3 & 8 Median: 0.6x Median: 4.7x (Michael Ferro 25% stake) 5.5x 9 5.5x 7 7 = High / Low Reference Range 4 10 0.0 21
Recent Newspaper Transactions ($ in millions, except per share values) B APPENDIX – PRECEDENT TRANSACTIONS New Media / Gannett Source: Teal Management, Company filings, press releases and FactSet. Note: EBITDA represents post - SBC EBITDA. 1 Represents $6.25 per share in cash plus 0.5427 New Media shares ($10.71 / share trading value based on the closing price as o f A ugust 2, 2019). 2 Limited financial information available on Berkshire Hathaway Media Group’s newspaper publications (no pension data was discl ose d). PROJECT CRAYOLA Lee Enterprises / Berkshire Hathaway Media Group 2 Gannett Standalone Financials 2017A 2018A 2019E Revenue $3,189 $2,944 $2,699 % Growth (10.1%) (7.7%) (8.4%) EBITDA $372 $330 $286 % Growth (6.3%) (11.4%) (13.4%) % Margin 11.7% 11.2% 10.6% Digital Revenue $744 $781 $767 % Total Revenue 23.3% 26.5% 28.4% Offer Price¹ $12.06 (x) FDSO 116.8 Fully Diluted Equity $1,408 (-) Options Proceeds (1) Equity Value $1,408 Plus: Debt $369 Plus: Minority Interest – Less: Investments (92) Less: Cash (113) Adj. Firm Value $1,571 LTM EBITDA 329 FV / LTM EBITDA 4.8x Plus: Pensions $293 Adj. Firm Value w Pension Obligation $1,864 LTM Adj. EBITDA ($9mm pension expense) 337 FV / LTM Adj. EBITDA 5.5x Versus - 10.8%, - 10.7% and - 8.4% for Teal in 2017, 2018 and 2019, respectively Versus 8% for Teal in 2019 Versus 18% for Teal in 2019 Transaction Value (excl. Real Estate) $140 LTM EBITDA $39 FV / LTM EBITDA 3.6x Memo: LTM EBITDA Pre-Lease Agreement $47 (-) Lease Payments to Berkshire (8) Implied LTM EBITDA $39 Chatham Asset Management / McClatchy Transaction Value $312 '20E EBITDA $92 FV / '20E EBITDA 3.4x Memo: Credit Bid of First Lien Notes $263 Cash 49 Transaction Value $312 22
Precedent Premiums Paid By Minority Shareholders Over The Last 10 Years: ( i ) FV $500mm - $ 2.0bn and (ii) Acquiror Ownership of Target Between 15% - 50% ($ in millions, except per share values) B APPENDIX – PRECEDENT TRANSACTIONS PROJECT CRAYOLA Source: Thomson SDC, company filings and publicly available news sources. Note: Transactions announced between January 1, 2010 and December 24, 2020. Removed Brookfield / GrafTech since it was a two - step tender / merger acquisition. 1 Based on undisturbed price prior to initial public offer. 2 Originally 1.735x (Initial Offer) and 1.75x (Final Offer) but ratio declined due to diligence issues. 3 $28.34 in cash and stock (also offered $26.06 in cash). Transactions with Existing Acquiror Ownership 3 1 1 Implied Prem. to Undist. First Initial Offer Undisturbed Final Firm Acq. % Target Ownership Initial Offer Premium Final Offer Premium Memo: Offer Public Date Agreement Comment Acquiror Target Value Pre Post Consideration1-Day Prior 4-Wk Prior 1-Day Prior 4-Wk Prior Initial OfferFinal Offer# of Bumps % Bump 02/12/19 Y 02/11/19 03/17/19 Tender JAB Cosmetics Coty $1,748 40.1% 60.0% Cash 24.9% 67.6% 24.9% 67.6% $11.65 $11.65 – – 11/09/18 Y 11/09/18 05/22/19 Common Control NASCAR Holdings International Speedway 1,167 39.5% 100.0% Cash 7.5% (0.6%) 15.2% 6.5% $42.00 $45.00 5 7.1% 11/29/17 N 12/31/17 01/02/18 GP / LP Archrock Archrock Partners 1,959 41.3% 100.0% Stock 16.4% 22.4% 23.4% 29.9% 1.32x 1.40x 2 6.1% 05/10/17 N 07/05/17 07/06/17 Merger Liberty Interactive HSN 1,757 38.2% 100.0% Stock 25.0% 11.5% 28.9% 15.0% 1.60x 1.65x 1 3.1% 10/26/15 Y 10/23/15 12/21/15 GP / LP Western Refining Northern Tier Energy 1,737 38.4% 100.0% Cash / Stock 14.8% 12.4% 17.8% 15.3% $27.62 $28.34 1 2.6% 06/10/13 Y 06/10/13 08/11/13 Merger w/ Go- Shop Investor Group Dole Food Co 1,018 37.6% 100.0% Cash 17.6% 12.0% 32.4% 26.1% $12.00 $13.50 4 12.5% 03/25/11 Y 03/24/11 07/10/11 GP / LP Vanguard Natural Resources Encore Energy Partners 764 46.0% 100.0% Stock (0.8%) 1.1% 3.3% 5.3% 0.72x 0.75x 1 4.2% Median: $1,737 39.5% 100.0% 16.4% 12.0% 23.4% 15.3% Mean: 1,450 40.2% 94.3% 15.1% 18.1% 20.8% 23.7% 2 2 23
CONFIDENTIAL C Appendix – Business Plan PROJECT CRAYOLA
’21E - ’23E Print declines consistent with ’17A - ’19A experience (declined 38% in 2020) Digital advertising in 2019 was hurt by: ( i ) Daily News shift to digital subscriptions, and (ii) Cars.com contract unwind Declined 24% in 2020 and recovers to 2019 levels by 2022 / 2023 Print circulation declined 8.6% in 2020 with similar declines forecasted for ’21E - ’23E (above the ’17A - ’19A levels) Digital circulation is forecasted to double between 2020 and 2023 based on subscriber growth and better churn management, despite less price discounting Traditional Other Revenue (direct mail and print / distribution for peers) declined 25% in 2020 (mid - teens percentage annual declines from ’20E - ’23E) Digital Other (content agency) revenue is held flat from ’20E - ’23E Margins rise from 9.5% in 2020 to 15.4% in 2021 (Q3’20A margins were 12.3% post - SBC) Margins rise to 18.1% by 2023 (margin expansion driven primarily by distribution outsourcing and the reduction in occupancy expense) Teal Financial Projections – Case A ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT CRAYOLA Summary of Teal Projections – Case A Case A Observations Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $193 $157 $121 $95 (20.5%) (22.2%) Digital Advertising 97 101 87 66 73 83 93 (5.3%) 12.7% Total Advertising $591 $472 $399 $259 $231 $204 $189 (17.8%) (9.6%) YoY Growth NA (20.1%) (15.4%) (35.1%) (10.9%) (11.8%) (7.4%) Print Circulation 363 357 337 308 286 263 239 (3.7%) (8.5%) Avg. Subs (000s) 895 792 677 592 515 ARPU (Weekly) $7.24 $7.48 $8.12 $8.52 $8.93 Digital Circulation 10 18 29 45 66 86 103 73.7% 25.3% Avg. Subs (000s) 290 384 469 526 579 ARPU (Weekly) $1.92 $2.27 $2.70 $3.13 $3.42 Total Circulation $373 $375 $366 $353 $352 $348 $343 (0.9%) (1.3%) YoY Growth NA 0.6% (2.4%) (3.5%) (0.4%) (1.0%) (1.6%) Traditional Other Revenue 156 137 130 98 83 69 57 (9.0%) (17.0%) Digital Other Revenue 36 49 51 34 30 32 34 18.9% 6.0% Total Other Revenue $192 $186 $181 $132 $113 $101 $91 (3.1%) (10.3%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (10.2%) (10.3%) Total Operating Revenue $1,156 $1,032 $946 $744 $695 $653 $622 (9.6%) (5.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.3%) (6.6%) (6.1%) (4.7%) Compensation 435 396 338 260 230 214 206 (11.8%) (5.3%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.5%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 29 6.2% (11.1%) Other Expenses 2 129 61 98 73 62 59 57 (13.0%) (4.3%) Total Operating Expenses $1,065 $942 $859 $669 $584 $539 $505 (10.1%) (7.0%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $76 $111 $114 $117 (2.9%) 2.6% YoY Growth 3.4% (0.8%) (4.9%) (12.3%) 46.6% 3.1% 2.1% Margin % 7.9% 8.8% 9.1% 10.2% 16.0% 17.5% 18.8% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $70 $107 $110 $113 (5.7%) 2.7% YoY Growth 1.6% (2.3%) (9.0%) (3.6%) 51.6% 3.2% 2.2% Margin % 7.1% 7.8% 7.7% 9.5% 15.4% 16.9% 18.1% 24
No changes to 2021 budget Case B revenues are $8mm lower in 2022 (versus Case A) and $26mm lower in 2023 (versus Case A) Roughly half of the revenue reductions come from Advertising with the other half split roughly evenly between Circulation and Other 2023 reductions in Advertising mostly in print (75%) 2023 reductions in Circulation and Other split roughly evenly between Print and Digital Margins decline from 15.4% in 2021 to 14.3% in 2023 (News Corp and New York Times levels) Teal Financial Projections – Case B ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT CRAYOLA Summary of Teal Projections – Case B Case B Observations Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $193 $157 $118 $86 (20.5%) (26.2%) Digital Advertising 97 101 87 66 73 82 91 (5.3%) 11.2% Total Advertising $591 $472 $399 $259 $231 $200 $177 (17.8%) (12.6%) YoY Growth NA (20.1%) (15.4%) (35.1%) (10.9%) (13.4%) (11.7%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (9.0%) Avg. Subs (000s) 895 792 677 592 512 ARPU (Weekly) $7.24 $7.48 $8.12 $8.52 $8.88 Digital Circulation 10 18 29 45 66 84 99 73.7% 22.8% Avg. Subs (000s) 290 384 469 526 576 ARPU (Weekly) $1.92 $2.27 $2.70 $3.07 $3.30 Total Circulation $373 $375 $366 $353 $352 $347 $336 (0.9%) (2.3%) YoY Growth NA 0.6% (2.4%) (3.5%) (0.4%) (1.4%) (3.1%) Traditional Other Revenue 156 137 130 98 83 69 54 (9.0%) (18.9%) Digital Other Revenue 36 49 51 34 30 30 30 18.9% (0.7%) Total Other Revenue $192 $186 $181 $132 $113 $98 $84 (3.1%) (13.7%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.9%) (14.5%) Total Operating Revenue $1,156 $1,032 $946 $744 $695 $645 $597 (9.6%) (7.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.3%) (6.6%) (7.3%) (7.5%) Compensation 435 396 338 260 230 214 207 (11.8%) (5.1%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.8%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 30 6.2% (10.1%) Other Expenses 2 129 61 98 73 62 59 57 (13.0%) (3.9%) Total Operating Expenses $1,065 $942 $859 $669 $584 $539 $507 (10.1%) (6.8%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $76 $111 $106 $89 (2.9%) (10.3%) YoY Growth 3.4% (0.8%) (4.9%) (12.3%) 46.6% (4.4%) (15.9%) Margin % 7.9% 8.8% 9.1% 10.2% 16.0% 16.5% 15.0% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $70 $107 $102 $85 (5.7%) (10.8%) YoY Growth 1.6% (2.3%) (9.0%) (3.6%) 51.6% (4.5%) (16.6%) Margin % 7.1% 7.8% 7.7% 9.5% 15.4% 15.8% 14.3% 25
No changes to 2021 budget Incorporates Case B revenues Target Gannett margins (~11% in 2019 and 2021) by 2023 Current operating similarities highlighted on the left side of page 28 This Case was prepared at the request of the Special Committee Teal Financial Projections – Case C ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT CRAYOLA Summary of Teal Projections – Case C Case C Observations Source:Prepared at the request of the Special Committee. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $193 $157 $118 $86 (20.5%) (26.2%) Digital Advertising 97 101 87 66 73 82 91 (5.3%) 11.2% Total Advertising $591 $472 $399 $259 $231 $200 $177 (17.8%) (12.6%) YoY Growth NA (20.1%) (15.4%) (35.1%) (10.9%) (13.4%) (11.7%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (9.0%) Avg. Subs (000s) 895 792 677 592 512 ARPU (Weekly) $7.24 $7.48 $8.12 $8.52 $8.88 Digital Circulation 10 18 29 45 66 84 99 73.7% 22.8% Avg. Subs (000s) 290 384 469 526 576 ARPU (Weekly) $1.92 $2.27 $2.70 $3.07 $3.30 Total Circulation $373 $375 $366 $353 $352 $347 $336 (0.9%) (2.3%) YoY Growth NA 0.6% (2.4%) (3.5%) (0.4%) (1.4%) (3.1%) Traditional Other Revenue 156 137 130 98 83 69 54 (9.0%) (18.9%) Digital Other Revenue 36 49 51 34 30 30 30 18.9% (0.7%) Total Other Revenue $192 $186 $181 $132 $113 $98 $84 (3.1%) (13.7%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.9%) (14.5%) Total Operating Revenue $1,156 $1,032 $946 $744 $695 $645 $597 (9.6%) (7.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.3%) (6.6%) (7.3%) (7.5%) Compensation 435 396 338 260 230 (11.8%) Circulation Distribution 203 178 171 148 131 (8.1%) Newsprint & Ink 69 68 57 34 27 (9.0%) Outside Services / Printing 174 179 134 103 98 (12.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 6.2% Other Expenses 2 129 61 98 73 62 (13.0%) Total Operating Expenses $1,065 $942 $859 $669 $584 $557 $527 (10.1%) (5.1%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $76 $111 $88 $70 (2.9%) (20.8%) YoY Growth 3.4% (0.8%) (4.9%) (12.3%) 46.6% (20.8%) (20.7%) Margin % 7.9% 8.8% 9.1% 10.2% 16.0% 13.6% 11.7% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $70 $107 $84 $66 (5.7%) (21.7%) YoY Growth 1.6% (2.3%) (9.0%) (3.6%) 51.6% (21.6%) (21.7%) Margin % 7.1% 7.8% 7.7% 9.5% 15.4% 13.0% 11.0% 26
Differences Between Cases – Cases B and C Relative to Case A ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT CRAYOLA Gap in Revenue Analysis Gap in Revenue 2021E Versus 2020E 2022E Gap 2023E Gap $ in millions 2021E 2020E Gap Case A Case B Case C A to B A to C Case A Case B Case C A to B A to C Print Advertising $157 $193 ($36) $121 $118 $118 ($3) ($3) $95 $86 $86 ($9) ($9) Digital Advertising 73 66 7 83 82 $82 (0) (0) 93 91 91 (3) (3) Total Advertising $231 $259 ($28) $204 $200 $200 ($4) ($4) $189 $177 $177 ($12) ($12) Print Circulation 286 308 (22) 263 263 263 – – 239 237 237 (3) (3) Digital Circulation 66 45 21 86 84 84 (2) (2) 103 99 99 (4) (4) Total Circulation $352 $353 ($2) $348 $347 $347 ($2) ($2) $343 $336 $336 ($7) ($7) Traditional Other Revenue 83 98 (15) 69 69 69 (1) (1) 57 54 54 (3) (3) Digital Other Revenue 30 34 (4) 32 30 30 (2) (2) 34 30 30 (4) (4) Total Other Revenue $113 $132 ($19) $101 $98 $98 ($3) ($3) $91 $84 $84 ($7) ($7) Total Operating Revenue $695 $744 ($49) $653 $645 $645 ($8) ($8) $622 $597 $597 ($26) ($26) Operating Expenses Operating Expenses as a Percentage of Revenue 2021E Versus 2020E 2022E Gap 2023E Gap $ in millions 2021E 2020E Gap Case A Case B Case C A to B A to C Case A Case B Case C A to B A to C Compensation 33.0% 34.9% (1.9%) 32.8% 33.2% 0.4% 33.1% 34.7% 1.6% Circulation Distribution 18.8% 19.9% (1.1%) 17.6% 17.8% 0.2% 16.6% 17.3% 0.7% Newsprint & Ink 3.9% 4.5% (0.6%) 3.9% 4.0% 0.1% 3.8% 4.0% 0.1% Outside Services / Printing 14.1% 13.8% 0.3% 14.0% 14.2% 0.2% 13.8% 14.4% 0.6% Occupancy, Insurance / Office Exp. 5.3% 6.9% (1.5%) 5.2% 5.3% 0.1% 4.7% 5.0% 0.3% Other Expenses1 8.9% 9.8% (0.9%) 9.0% 9.1% 0.1% 9.1% 9.6% 0.5% Stock-Based Compensation 0.6% 0.7% (0.1%) 0.6% 0.6% 0.0% 0.7% 0.7% 0.0% Total Operating Expenses 84.6% 90.5% (5.9%) 83.1% 84.2% 87.0% 1.1% 3.9% 81.9% 85.7% 89.0% 3.9% 7.1% EBITDA (Post-SBC) $107 $70 $36 $110 $102 $84 ($8) ($27) $113 $85 $66 ($28) ($47) Margin % 15.4% 9.5% 16.9% 15.8% 13.0% 18.1% 14.3% 11.0% Source: Teal Management. 1 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. 27
Operations In Perspective – Similar to Gannett C APPENDIX – BUSINESS PLAN PROJECT CRAYOLA % Digital LTM Revenue Days Receivable as of September 30 th , 2020 2 Source: Teal Management, Company filings, FactSet and Wall Street Research. 1 Pro forma for sale of BestReviews . 2 Based on a 365 day year and LTM revenue. 3 Includes A/P, accrued expenses, comp and benefits, as well as deferred revenue (excludes the current portion of debt and leas es and other current liabilities). 4 News Corp does not fully disclose the details of its digital revenues. 2020E EBITDA (Post - SBC) Margin ’19A EBITDA (Post - SBC) Margin 34.9 29.4 23.9 51.5 25.7 1 Teal 7.8% 10.9% 19.5% 11.8% 13.7% 1 Teal 19.0% 37.0% 36.8% 36.8% 18.4% 26.6% 44.0% Teal 1 9.5% 18.1% 14.3% 11.0% 9.7% 15.8% 11.8% 13.4% 2.5% 5.3% 0.7% 2.3% 1.8% ’19A Capex % Revenue Teal Case A 2023E 1 Teal Case B 2023E 1 1.0% 1.0% Teal Case C 2023E 1 87.2 74.4 55.2 Similar 43.7 55.9 Teal 1 Teal Case A 2023E 1 Teal Case B 2023E 1 Teal Case C 2023E 1 1.0% 15.6% 13.4% NA 15.4% 11.1% ’21E EBITDA (Post - SBC) Margin NA 4 Days Core Current Liabilities as of 9/30/20 2,3 Similar Note: ’19A - ’21E Revenue CAGR (14.2%) Teal ( Mgmt Estimate) (13.3%) Gannett (Street) 28
Unlevered Free Cash Flow Build ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT CRAYOLA Case A Case B Case C February Model 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E Revenue $1,156 $1,032 $946 $744 $695 $653 $622 $645 $597 $645 $597 % Growth (10.7%) (8.4%) (21.3%) (6.6%) (6.1%) (4.7%) (7.3%) (7.5%) (7.3%) (7.5%) Pre-SBC EBITDA 92 91 86 76 111 114 117 106 89 88 70 Less: SBC (9) (10) (13) (5) (4) (4) (4) (4) (4) (4) (4) Post SBC EBITDA $82 $80 $73 $70 $107 $110 $113 $102 $85 $84 $66 % Growth (2.3%) (9.0%) (3.6%) 51.6% 3.2% 2.2% (4.5%) (16.6%) (21.6%) (21.7%) % Margin 7.1% 7.8% 7.7% 9.5% 15.4% 16.9% 18.1% 15.8% 14.3% 13.0% 11.0% Less: D&A ($48) ($51) ($21) ($9) ($8) ($7) ($5) ($7) ($5) ($7) ($5) Less: Adjusted Expenses (34) (75) (36) (24) (40) (12) (13) (12) (13) (12) (13) Plus: Property Sales – – 0 10 7 4 – 4 – 4 – EBT ($0) ($45) $16 $47 $66 $95 $95 $87 $67 $69 $48 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes 0 13 (5) (13) (19) (27) (27) (24) (19) (19) (13) NOPAT ($0) ($33) $12 $34 $48 $69 $68 $63 $48 $50 $34 Plus: D&A $48 $51 $21 $9 $8 $7 $5 $7 $5 $7 $5 Plus: Change in NWC (6) 4 10 (3) (2) (0) 3 1 5 1 5 Plus: SBC1 5 5 7 3 2 2 2 2 2 2 2 Less: Capex (24) (33) (22) (10) (6) (6) (6) (6) (6) (6) (6) % Capex / Revenue 2.1% 3.2% 2.3% 1.3% 0.9% 0.9% 1.0% 0.9% 1.0% 0.9% 1.0% Less: Pension Contribution (2) (3) (4) (4) (2) (2) (2) (2) (2) (2) (2) Plus: Tax Benefit from Pension Cont. 0 1 1 1 1 1 1 1 1 1 1 Unlevered Free Cash Flow $21 ($8) $25 $30 $49 $69 $71 $64 $53 $51 $38 % Growth n.m. n.m. 23.4% 60.3% 42.9% 2.0% 32.3% (18.1%) 5.2% (24.6%) UFCF Conversion % 1.8% (0.7%) 2.6% 4.1% 7.0% 10.6% 11.4% 10.0% 8.8% 7.9% 6.5% Source: Teal Management, Company filings, FactSet and Wall Street Research. Note: Pro forma for sale of BestReviews . 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). Teal UFCF Build and Case Comparison 29
CONFIDENTIAL D Appendix – DCF PROJECT CRAYOLA
D APPENDIX – DCF PROJECT CRAYOLA Unlevered Free Cash Flow Projections Source: Teal Case A. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $113mm. Net debt includes cash of $219mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. Teal – DCF Valuation Analysis at 12/31/2020 (Case A) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $744 $695 $653 $622 (5.8%) % Growth (8.4%) (21.3%) (6.6%) (6.1%) (4.7%) Pre-SBC EBITDA 86 76 111 114 117 15.6% Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $70 $107 $110 $113 16.9% $113 % Growth (9.0%) (3.6%) 51.6% 3.2% 2.2% % Margin 7.7% 9.5% 15.4% 16.9% 18.1% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $47 $66 $95 $95 25.9% $107 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (13) (19) (27) (27) (30) NOPAT $12 $34 $48 $69 $68 25.9% $77 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) (0) 3 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Unlevered Free Cash Flow $25 $30 $49 $69 $71 32.7% $77 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $16.70 $17.84 $18.99 $20.14 $21.29 9.5% 16.57 17.70 18.83 19.96 21.10 10.0% 16.44 17.56 18.67 19.79 20.91 10.5% 16.31 17.41 18.52 19.62 20.72 11.0% 16.19 17.28 18.36 19.45 20.54 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.2%) (8.8%) (6.9%) (5.3%) (4.1%) 9.5% (10.8%) (8.3%) (6.4%) (4.9%) (3.6%) 10.0% (10.4%) (7.9%) (6.0%) (4.5%) (3.2%) 10.5% (10.0%) (7.5%) (5.6%) (4.0%) (2.8%) 11.0% (9.6%) (7.1%) (5.2%) (3.6%) (2.3%) Revenue is expected to decline by 4.7% in 2023 30
D APPENDIX – DCF PROJECT CRAYOLA DCF Valuation Analysis – Terminal Multiple Method¹ Source: Teal Case A. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $113mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 Net debt includes cash of $219mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Case A) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $150 $261 $305 $348 $392 $435 $412 $455 $499 $542 $586 5.8x 6.5x 7.1x 7.7x 8.3x 9.5% 149 257 300 343 386 429 407 450 492 535 578 5.8 6.4 7.0 7.6 8.2 10.0% 148 254 296 339 381 423 402 444 486 529 571 5.7 6.3 6.9 7.5 8.1 10.5% 146 251 292 334 376 418 397 439 481 522 564 5.6 6.2 6.8 7.4 8.0 11.0% 145 247 288 330 371 412 392 434 475 516 557 5.6 6.2 6.7 7.3 7.9 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.2%) (8.8%) (6.9%) (5.3%) (4.1%) 63.4% 66.9% 69.8% 72.2% 74.3% 3.9x 4.3x 4.7x 5.1x 5.5x 9.5% (10.8%) (8.3%) (6.4%) (4.9%) (3.6%) 63.3% 66.8% 69.7% 72.1% 74.2% 3.8 4.2 4.6 5.0 5.4 10.0% (10.4%) (7.9%) (6.0%) (4.5%) (3.2%) 63.2% 66.7% 69.6% 72.1% 74.1% 3.8 4.2 4.6 4.9 5.3 10.5% (10.0%) (7.5%) (5.6%) (4.0%) (2.8%) 63.1% 66.6% 69.5% 72.0% 74.0% 3.7 4.1 4.5 4.9 5.3 11.0% (9.6%) (7.1%) (5.2%) (3.6%) (2.3%) 63.0% 66.5% 69.4% 71.9% 73.9% 3.7 4.1 4.4 4.8 5.2 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $631 $674 $718 $761 $805 $16.70 $17.84 $18.99 $20.14 $21.29 9.5% 626 669 712 755 798 16.57 17.70 18.83 19.96 21.10 10.0% 621 663 706 748 790 16.44 17.56 18.67 19.79 20.91 10.5% 616 658 700 742 783 16.31 17.41 18.52 19.62 20.72 11.0% 612 653 694 735 776 16.19 17.28 18.36 19.45 20.54 FV Build Shares Outstanding FV $493 (-) PV of Pension Liability (Post-2023)¹ (7) FV (after Pension) $486 (-) Net Debt2 219 Equity Value $706 (+) Options Proceeds 2 FD Equity $708 / FDSO 37.897 Implied Share Price $18.67 31
D APPENDIX – DCF PROJECT CRAYOLA Unlevered Free Cash Flow Projections Source: Teal Case B. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $85mm. Net debt includes cash of $219mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. Teal – DCF Valuation Analysis at 12/31/2020 (Case B) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $744 $695 $645 $597 (7.1%) % Growth (8.4%) (21.3%) (6.6%) (7.3%) (7.5%) Pre-SBC EBITDA 86 76 111 106 89 5.6% Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $70 $107 $102 $85 6.5% $85 % Growth (9.0%) (3.6%) 51.6% (4.5%) (16.6%) % Margin 7.7% 9.5% 15.4% 15.8% 14.3% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $47 $66 $87 $67 12.3% $79 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (13) (19) (24) (19) (22) NOPAT $12 $34 $48 $63 $48 12.3% $57 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) 1 5 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Unlevered Free Cash Flow $25 $30 $49 $64 $53 20.2% $57 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $14.52 $15.39 $16.25 $17.12 $17.99 9.5% 14.42 15.27 16.13 16.98 17.84 10.0% 14.32 15.16 16.01 16.85 17.69 10.5% 14.22 15.06 15.89 16.72 17.55 11.0% 14.13 14.95 15.77 16.59 17.41 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.9%) (8.5%) (6.6%) (5.1%) (3.9%) 9.5% (10.5%) (8.1%) (6.2%) (4.7%) (3.4%) 10.0% (10.1%) (7.7%) (5.8%) (4.2%) (3.0%) 10.5% (9.7%) (7.2%) (5.3%) (3.8%) (2.5%) 11.0% (9.2%) (6.8%) (4.9%) (3.4%) (2.1%) Revenue is expected to decline by 7.5% in 2023 32
D APPENDIX – DCF PROJECT CRAYOLA DCF Valuation Analysis – Terminal Multiple Method¹ Source: Teal Case B. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $85mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 Net debt includes cash of $219mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Case B) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $132 $197 $230 $263 $296 $328 $329 $362 $395 $428 $460 4.7x 5.1x 5.6x 6.1x 6.5x 9.5% 131 194 227 259 292 324 325 358 390 422 455 4.6 5.1 5.5 6.0 6.5 10.0% 130 192 224 256 288 320 322 354 385 417 449 4.6 5.0 5.5 5.9 6.4 10.5% 129 189 221 252 284 315 318 349 381 412 444 4.5 5.0 5.4 5.9 6.3 11.0% 128 187 218 249 280 311 314 345 376 408 439 4.5 4.9 5.3 5.8 6.2 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.9%) (8.5%) (6.6%) (5.1%) (3.9%) 59.9% 63.5% 66.5% 69.1% 71.3% 3.1x 3.4x 3.7x 4.0x 4.3x 9.5% (10.5%) (8.1%) (6.2%) (4.7%) (3.4%) 59.7% 63.4% 66.4% 69.0% 71.2% 3.0 3.3 3.7 4.0 4.3 10.0% (10.1%) (7.7%) (5.8%) (4.2%) (3.0%) 59.6% 63.3% 66.3% 68.9% 71.1% 3.0 3.3 3.6 3.9 4.2 10.5% (9.7%) (7.2%) (5.3%) (3.8%) (2.5%) 59.5% 63.1% 66.2% 68.8% 71.0% 3.0 3.3 3.6 3.9 4.2 11.0% (9.2%) (6.8%) (4.9%) (3.4%) (2.1%) 59.4% 63.0% 66.1% 68.7% 70.9% 2.9 3.2 3.5 3.8 4.1 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $548 $581 $614 $647 $680 $14.52 $15.39 $16.25 $17.12 $17.99 9.5% 545 577 609 642 674 14.42 15.27 16.13 16.98 17.84 10.0% 541 573 605 637 669 14.32 15.16 16.01 16.85 17.69 10.5% 537 569 600 632 663 14.22 15.06 15.89 16.72 17.55 11.0% 534 565 596 627 658 14.13 14.95 15.77 16.59 17.41 FV Build Shares Outstanding FV $392 (-) PV of Pension Liability (Post-2023)¹ (7) FV (after Pension) $385 (-) Net Debt2 219 Equity Value $605 (+) Options Proceeds 2 FD Equity $607 / FDSO 37.890 Implied Share Price $16.01 33
D APPENDIX – DCF PROJECT CRAYOLA Unlevered Free Cash Flow Projections Source: Teal Case C. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $66mm. Net debt includes cash of $219mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. Teal – DCF Valuation Analysis at 12/31/2020 (Case C) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $744 $695 $645 $597 (7.1%) % Growth (8.4%) (21.3%) (6.6%) (7.3%) (7.5%) Pre-SBC EBITDA 86 76 111 88 70 (2.7%) Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $70 $107 $84 $66 (2.4%) $66 % Growth (9.0%) (3.6%) 51.6% (21.6%) (21.7%) % Margin 7.7% 9.5% 15.4% 13.0% 11.0% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $47 $66 $69 $48 0.1% $60 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (13) (19) (19) (13) (17) NOPAT $12 $34 $48 $50 $34 0.1% $43 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) 1 5 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Unlevered Free Cash Flow $25 $30 $49 $51 $38 8.3% $43 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $12.74 $13.41 $14.08 $14.75 $15.42 9.5% 12.66 13.32 13.98 14.64 15.30 10.0% 12.59 13.24 13.89 14.54 15.19 10.5% 12.51 13.15 13.80 14.44 15.08 11.0% 12.44 13.07 13.71 14.34 14.97 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.5%) (8.2%) (6.3%) (4.8%) (3.6%) 9.5% (10.1%) (7.7%) (5.9%) (4.4%) (3.2%) 10.0% (9.7%) (7.3%) (5.5%) (4.0%) (2.7%) 10.5% (9.3%) (6.9%) (5.0%) (3.5%) (2.3%) 11.0% (8.9%) (6.5%) (4.6%) (3.1%) (1.8%) Revenue is expected to decline by 7.5% in 2023 34
D APPENDIX – DCF PROJECT CRAYOLA DCF Valuation Analysis – Terminal Multiple Method¹ Source: Teal Case C. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $66mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 Net debt includes cash of $219mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Case C) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $110 $152 $177 $202 $228 $253 $262 $287 $313 $338 $363 3.7x 4.1x 4.4x 4.8x 5.2x 9.5% 109 150 175 200 225 250 259 284 309 334 359 3.7 4.0 4.4 4.7 5.1 10.0% 108 148 172 197 222 246 256 281 305 330 355 3.6 4.0 4.3 4.7 5.0 10.5% 108 146 170 194 219 243 253 278 302 326 350 3.6 3.9 4.3 4.6 5.0 11.0% 107 144 168 192 216 240 250 274 298 322 346 3.6 3.9 4.2 4.6 4.9 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.5%) (8.2%) (6.3%) (4.8%) (3.6%) 57.9% 61.6% 64.8% 67.4% 69.7% 2.5x 2.7x 2.9x 3.2x 3.4x 9.5% (10.1%) (7.7%) (5.9%) (4.4%) (3.2%) 57.8% 61.5% 64.6% 67.3% 69.5% 2.4 2.7 2.9 3.1 3.4 10.0% (9.7%) (7.3%) (5.5%) (4.0%) (2.7%) 57.7% 61.4% 64.5% 67.1% 69.4% 2.4 2.6 2.9 3.1 3.3 10.5% (9.3%) (6.9%) (5.0%) (3.5%) (2.3%) 57.5% 61.2% 64.4% 67.0% 69.3% 2.4 2.6 2.8 3.1 3.3 11.0% (8.9%) (6.5%) (4.6%) (3.1%) (1.8%) 57.4% 61.1% 64.2% 66.9% 69.2% 2.3 2.6 2.8 3.0 3.2 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $481 $507 $532 $557 $582 $12.74 $13.41 $14.08 $14.75 $15.42 9.5% 478 503 528 553 578 12.66 13.32 13.98 14.64 15.30 10.0% 475 500 525 549 574 12.59 13.24 13.89 14.54 15.19 10.5% 473 497 521 545 570 12.51 13.15 13.80 14.44 15.08 11.0% 470 494 518 542 566 12.44 13.07 13.71 14.34 14.97 FV Build Shares Outstanding FV $312 (-) PV of Pension Liability (Post-2023)¹ (7) FV (after Pension) $305 (-) Net Debt2 219 Equity Value $525 (+) Options Proceeds – FD Equity $525 / FDSO 37.770 Implied Share Price $13.89 35
CONFIDENTIAL E Appendix – WACC PROJECT CRAYOLA
Teal WACC Analysis: Selected Range of ~9% - 11% ($ in millions) E APPENDIX – WACC Current Public Comparables Source: Teal Management, Company filings, Barra Beta Book, Bloomberg, FactSet, Duff & Phelps, MSCI and U.S. Department of the Tr easury. Note: Market values as of December 24, 2020. 1 Levered Beta = Unlevered Beta x [1 + (1 - Tax Rate)(Debt/Equity)]. 2 Long - horizon expected equity risk premium (historical): large company stock total returns minus long - term government bond income returns (Source: Duff & Phelps). 3 Represents 30 - year U.S. Treasury yield as of December 24, 2020. 4 Cost of Equity = (Risk Free Rate of Return) + (Levered Beta)(Equity Risk Premium). 5 Weighted Average Cost of Capital = (After - Tax Cost of Debt)(Debt/Cap) + (Cost of Equity)(Equity/Cap). PROJECT CRAYOLA Illustrative Calculations WACC Sensitivity 7.0 – 9.0% WACC: CS 7.3 – 9.3% WACC: Jefferies 8.0 – 9.0% WACC: Greenhill 7.0 – 8.0% WACC: GS 9.5% WACC: Greenhill 7.0 – 8.0% WACC: GS New Media: Gannett: Pro Forma: Unlevered Beta 1.000 1.200 Target Debt / Cap – 30.0% Target Debt / Equity – 42.9% Levering Factor 1.000 1.309 Levered Beta¹ 1.000 1.570 Equity Risk Premium² 7.2% 7.2% Risk Premium 7.2% 11.2% Risk Free (30-Year Treasury)³ 1.7% 1.7% Cost of Equity4 8.8% 12.9% Pre-Tax Cost of Debt – 8.5% Marginal Tax Rate 28.0% 28.0% WACC5 8.8% 10.9% Debt / Asset Beta Cap Cost of Debt 1.000 1.050 1.100 1.150 1.200 – – 8.8% 9.2% 9.5% 9.9% 10.2% 15.0% 6.5% 9.0% 9.3% 9.6% 10.0% 10.3% 15.0% 7.5% 9.1% 9.4% 9.8% 10.1% 10.4% 15.0% 8.5% 9.2% 9.5% 9.9% 10.2% 10.6% 30.0% 6.5% 9.1% 9.4% 9.8% 10.1% 10.4% 30.0% 7.5% 9.3% 9.7% 10.0% 10.3% 10.6% 30.0% 8.5% 9.5% 9.9% 10.2% 10.5% 10.9% Capital Structure Local Beta (2 Year, Weekly, Raw) Equity Debt / Debt / Levered Unlevered Levered Unlevered Marginal Value Cap. Equity Beta Beta Beta Beta Tax Rate Teal $482 – – 1.112 1.112 1.502 1.502 28.0% Gannett 399 78.8% 372.1% 2.075 0.570 2.996 0.823 29.0% Lee Enterprises 71 88.4% NM 1.494 0.246 0.904 0.149 33.3% News Corp 10,636 10.8% 12.1% 1.055 0.972 1.036 0.954 29.1% New York Times 8,655 – – 0.864 0.864 0.827 0.827 26.0% Barra Predicted Bloomberg Historical Public Benchmarks: New Media / Gannett Merger Proxy and Lee Cost of Debt Cost of debt for New Media / Gannett: 11.5% from Apollo PF Leverage of 3.4x 2019E EBITDA Cost of debt for Lee: 9.0% from Berkshire Hathaway PF Leverage of 3.8x 2019A EBITDA 36
Historical Betas – Last Five Years E APPENDIX – WACC PROJECT CRAYOLA Predicted Barra Local Beta FactSet 2 - Year Trailing Betas Teal Source: MSCI and FactSet. GCI NWSA NYT Teal Teal 1Yr. 3Yr. 5Yr. High 1.59 1.90 1.90 Median 1.51 0.54 0.76 Low 0.46 0.10 0.10 Teal Avg. 1.27 0.81 0.93 1Yr. 3Yr. 5Yr. High 1.33 1.35 1.74 Median 1.23 1.06 1.24 Low 0.91 0.77 0.77 Teal Avg. 1.20 1.09 1.25 0.00 0.50 1.00 1.50 2.00 2.50 3.00 Nov-15 Nov-16 Nov-17 Nov-18 Nov-19 Nov-20 0.00 0.50 1.00 1.50 2.00 2.50 3.00 Nov-15 Nov-16 Nov-17 Nov-18 Nov-19 Nov-20 LEE GCI LEE NWSA NYT GCI LEE NWSA NYT 1.57 1.00 1.57 1.00 37
Predicted Barra Local Beta Historical Ranges E APPENDIX – WACC PROJECT CRAYOLA 0.908 1.205 1.061 0.849 0.941 1.329 2.186 1.627 0.984 1.081 1.112 2.075 1.494 0.864 1.055 Teal GCI LEE NYT NWSA L6M Range LTM Range Current 12 Month and 6 Month Historical Ranges Source: MSCI. Note: Represents Predicted Barra Local Beta ranges. Last 12 Months Max 1.329 2.186 1.627 0.984 1.081 Median 1.230 2.013 1.495 0.893 1.024 Min 0.908 1.205 1.061 0.849 0.941 38
CONFIDENTIAL F Appendix – Other Potential Parties PROJECT CRAYOLA
Voting Scenarios (Shares in millions) F APPENDIX – OTHER POTENTIAL PARTIES PROJECT CRAYOLA Amber Proposal Alternative Proposal Source: Teal Management, company filings and FactSet. 1 Showing the minimum number of public votes necessary for the relevant proposal to pass. 2 Assumes that 70% of the total public shares (non - PSS / Amber) participate in the vote. 3 PSS is assumed to vote in favor of the highest sale price proposal given he was understood to have had conversations with Amb er and Slaine in July 2020 regarding a sale of his shares. 4 Basic shares outstanding only. Excludes options and RSUs. Shares % of Public Float (Voting) Voting Requirement 2/3 vote of the outstanding non - Amber shares (not by written consent) Majority of the outstanding voting stock All Vote 70% Vote 2 All Vote 70% Vote 2 Minimum Public - For 1 7.985 7.985 9.617 9.617 Public - Against 8.364 3.460 6.733 1.828 Total Voting Public 16.350 11.445 16.350 11.445 PSS Shares - For 3 8.744 8.744 8.744 8.744 Amber - Against NA NA 11.554 11.554 Total Voting 25.093 20.188 36.648 31.743 % in Favor 66.7% 82.9% 50.1% 57.8% Amber - For 11.554 11.554 – – Public Non-Voting Shares – 4.905 – 4.905 Total Shares Outstanding 4 36.648 36.648 36.648 36.648 % in Favor 77.2% 77.2% 50.1% 50.1% % in Favor (excl. Amber) 66.7% 66.7% – – Minimum Public - For 48.8% 69.8% 58.8% 84.0% Public - Against 51.2% 30.2% 41.2% 16.0% Total Voting Public 100.0% 100.0% 100.0% 100.0% Slaine and BestReviews Management hold 4.7mm shares 39
History of Strategic Discussions F APPENDIX – OTHER POTENTIAL PARTIES PROJECT CRAYOLA Timeline Description Summer 2018 Donerail discussions ( Donerail to buy Teal and sell - off the pieces); ultimately, Donerail never secured financing for a “bust - up” Fall 2018 Process to sell the company (rumors of the process made it into the press); led to McClatchy discussions which were terminated when McClatchy could not secure financing Winter / Spring 2019 Gannett discussions regarding a combination (Teal as buyer or seller) after Amber / MediaNews announced an unsolicited offer for Gannett; Gannett ultimately merged with New Media in November 2019 Spring 2019 McClatchy discussions regarding ( i ) a full combination, and (ii) the sale of Teal Florida to McClatchy; McClatchy could not secure financing and ultimately went through bankruptcy Summer / Fall 2019 Apollo discussions regarding financing for a special dividend; given Apollo’s positions in New Media / Gannett and Cox Broadcasting (which raised regulatory concerns), Apollo and Teal terminated discussions (after Apollo repeatedly revised the terms, making the loan smaller and more onerous to Teal) Fall 2019 Amber approached about a cash / stock merger between MediaNews and Teal; Ferro (as the largest Teal shareholder and company consultant) indicated he would support an all cash deal at $13 / share; Amber withdrew from the discussions November 2019 – March 2020 Amber acquired 32% of Teal without board approval (Delaware 203 not waived). Amber entered into a standstill on 12/2/19 and began discussing potential intercompany agreements between Amber - owned MediaNews and Teal (these talks were complicated by Delaware 203). In January 2020, Amber approached Teal for a standstill waiver in order to buy Patrick Soon - Shiong’s 25% stake in Teal for $13.50 per share (waiver was not granted). Amber made a private approach to the Teal board in February 2020 to acquire all of the Teal shares it did not own for $13.50 / share. These discussions were halted due to COVID - 19 disruptions Summer 2020 Teal understood that PSS had conversations with Amber and Slaine in July regarding a potential sale of his stake in Teal (this led to the adoption of the shareholder rights plan) 40
F APPENDIX – OTHER POTENTIAL PARTIES PROJECT CRAYOLA Source: Teal Management and Public Filings. Note: Market values as of December 24, 2020. Balance sheet as of Q3 2020 for Gannett and Q4 2020 for Teal. 1 Based on illustrative $14.25 per share offer. 2 EBITDA adds back pension expense of $15mm for Gannett and $2mm for Teal. Gannett Merger with Teal @ $14.25 Per Share (All Stock) ($ in millions, except per share values) SQ SQ Pro Forma Gannett Teal @ $14.25 Price / Share $2.75 $14.25 $2.75 (x) FDSO 145.1 37.8 340.8 Fully Diluted Equity $399 $538 $937 (-) Options Proceeds – – – Equity Value $399 $538 $937 Debt $1,484 – $1,484 Minority Interest 4 – 4 Investments (36) (0) (36) Cash (254) (219) (473) Firm Value w/o Pension $1,597 $319 $1,916 2020E Adj. EBITDA (post-SBC) $328 $70 $398 2020E Adj. EBITDA (pre-SBC) 356 76 432 FV / 2020E Adj. EBITDA (post-SBC) 4.9x 4.5x 4.8x Debt / 2020E Adj. EBITDA (pre-SBC) 4.2 – 3.4 Net Debt / 2020E Adj. EBITDA (pre-SBC) 3.5 – 2.3 Pensions $117 $17 $134 Firm Value w/ Pension $1,714 $336 $2,050 2020E Adj. EBITDA (post-SBC) $343 $72 $416 2020E Adj. EBITDA (pre-SBC) 371 77 449 FV / 2020E Adj. EBITDA (post-SBC) 5.0x 4.7x 4.9x Debt / 2020E Adj. EBITDA (pre-SBC) 4.3 0.2 3.6 Net Debt / 2020E Adj. EBITDA (pre-SBC) 3.6 – 2.6 1 2 2 Teal owns 57% At $12.75 / share Teal has a $482mm market cap; so an at - market exchange would give Teal 55% of the combined company 41
Currently holds a 7.8% stake in Teal, and is the third largest shareholder of the company Chairman of technology firm Cast & Crew Currently sits on the board of Reorg Inc. and Cetara LLC. Slaine is also executive chairman of information services firm MLM2 (Warburg committed $1bn in September 2020) and a principal investor in Varo Bank Former executive chairman of Interactive Data Corp., which was sold to the Intercontinental Exchange in 2015 Slaine was the President and CEO Investment Dealers’ Digest from 1982 – 1986, the chairman and CEO of Securities and Data Corp from 1987 – 1991, and involved with Thomson Financial from 1991 – 1994, when he became the President and CEO of Thomson Financial through 1996. Founded FT Media Holdings in 2005, with Warburg Pincus , which was acquired by Gannett in 2018 Slaine graduated from Amherst College and holds an M.B.A. from Harvard Business School Background On Relevant Individuals F APPENDIX – OTHER POTENTIAL PARTIES PROJECT CRAYOLA Chairman of Choice Hotels International since October 1998 Served as chairman and CEO of Manor Care until 1998, when it merged with Health Care and Retirement Corp Founder of Somerford Place Corporation in 1998 and Artis Senior Living in 2012 Politically involved and served as a senator in the Maryland General Assembly from 1979 to 1987, where he was a member of each House’s budget and tax committee . Bainum has remained active in Democratic politics and served as a delegate to the Democratic Conventions in 1984, 1992 and 2008 Currently a member of both the Real Estate Roundtable and the Board of Advisors of UCLA’s Anderson School of Business Bainum graduated from Pacific Union College and holds an M.B.A. from the UCLA Anderson School of Management. Bainum also holds a theology degree from Andrews University Stewart Bainum , Jr. Mason Slaine Source: FactSet and publicly available news sources. 42
CONFIDENTIAL G Appendix – Teal Shareholders PROJECT CRAYOLA
# Shareholder Ownership Stake and Cumulative Holdings Current Market Value 1yr ∆ in % O/S Total Ownership Breakdown 1 1 Amber Global Capital $147 (0.4%) 2 Patrick Soon - Shiong 111 (0.3%) 3 Mason Slaine 37 +7.8% 4 BestReviews 24 (0.1%) 5 Dimensional Holdings 20 +0.3% 6 Morgan Stanley 15 +3.0% 7 BlackRock 15 (0.4%) 8 Renaissance Technologies 11 +0.3% 9 BrightSphere Investment Group 10 (0.2%) Top 10 Shareholder Concentration Evolution 10 Vanguard 9 (1.0%) 11 State Street 7 +0.5% 12 Northern Trust 5 +0.4% 13 Geode Holdings Trust 4 -- 14 Grantham, Mayo, Van Otterloo & Co. 3 +0.1% 15 Quinn Opportunity Partners 3 -- 16 Arrowstreet Capital 3 +0.1% 17 Timothy Knight 3 +0.4% 18 PRIMECAP Management 3 (5.5%) 19 Terry Jimenez 2 +0.2% 20 Charles Schwab 2 +0.1% 21 Jacobs Levy Equity Management 2 +0.1% 22 David Dreier 2 -- 23 GFH HFEVA 1 +0.1% 24 Credit Suisse 1 (0.1%) 25 AXA SA 1 +0.3% Teal's Top 25 Shareholders ($ in millions) 23.9% 7.8% 5.2% 4.2% 3.2% 3.2% 2.4% 2.1% 2.0% 1.5% 1.0% 0.8% 0.7% 0.7% 0.6% 0.6% 0.6% 0.5% 0.4% 0.4% 0.4% 0.3% 0.3% 0.3% 31.6% 55.6% 63.4% 68.6% 72.9% 76.1% 79.3% 81.7% 83.8% 85.8% 87.3% 88.3% 89.1% 89.8% 90.4% 91.1% 91.7% 92.2% 92.7% 93.1% 93.5% 93.9% 94.2% 94.5% 94.7% Top 5 Top 10 Top 15 Top 20 Top 25 Source: FactSet as per most recent filings. Note: Market pricing as of December 24, 2020. Ownership stake based on basic shares outstanding, consolidated across funds. One - year prior date of December 31, 2019, and five - year prior date of December 31, 2015. 1 Reflects entire shareholder base, not just top 25 shareholders, as per FactSet holdings information. PROJECT CRAYOLA G APPENDIX – TEAL SHAREHOLDERS Insider 40% Passive 8% Active 52% 72.9% 85.8% 71.6% 83.7% 48.5% 67.7% 1 2 3 4 5 6 7 8 9 10 Shareholder # Cumulative % O/S Today 1 Year ago 5 Years ago 43
Exhibit (c)(3)
Project Alinea TEAL SPECIAL COMMITTEE UPDATE JANUARY 2021 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT ALINEA CONFIDENTIAL 1
11.00 11.50 12.00 12.50 13.00 13.50 14.00 14.50 15.00 15.50 11-Dec-20 17-Dec-20 23-Dec-20 30-Dec-20 05-Jan-21 12-Jan-21 Market Price History PROJECT ALINEA Share Price Evolution Since December 11, 2020 $14.86 / share on 1/12/21 ($2.00 of dividends / share paid since 1/1/19) 12/14/20 Teal receives offer letter from Amber Source: FactSet, Company filings and publicly available sources. Historical stock prices shown are not adjusted for subsequent d ividends paid. Note: Market values as of January 12, 2021. 12/30/20 Special Committee Meeting & WSJ Article on Amber offer (post - close) 12/31/20 BestReviews 8K & EBITDA Guidance; Huber $15 price target 1/4/21 Noble $20.75 price target Volume in Shares (‘000s) 50 49 45 91 70 325 71 82 36 75 65 262 117 457 177 380 141 69 53 49 51 – 100 200 300 400 500 Avg. daily trading volume over the last 3 months was 95K shares $ 12/22/20 Special Committee Meeting $14.25 / share Amber offer 12/17/20 Special Committee Meeting 2
Comparables PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as January 12, 2021. 1 Pro forma for sale of BestReviews . Teal Mgmt. balance sheet as of Q4 2020. Share Price Performance Since December 24, 2020 (20%) 0% 20% 40% 60% 24-Dec-20 27-Dec-20 31-Dec-20 4-Jan-21 8-Jan-21 12-Jan-21 NYT (8.5%) S&P500 2.6% NWSA 3.3% LEE 21.2% PF GCI 40.4% Teal 16.5% Teal $12.75 FV / 2020E EBITDA (w/ Pensions) 5.0x 5.5x 5.2x 16.6x 28.7x FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) @ $14.86 3.3x 5.1x NA 15.0x 23.0x 31.6x 16.4x 5.1x 5.0x 12/24/20 Multiples 1 3.9x 25.3x 14.8x NA 4.7x 12/24/20 Multiples 2.6x 12/30/20 Special Committee Meeting & WSJ Article on Amber offer (post - close) Teal ( Mgmt ) @ $14.86 1 GCI equity value rose $160mm since 12/24/20 (9% on a $1.7bn firm value with pensions) 3
Commentary & Discussions PROJECT ALINEA Huber Research (12/31/20) $16 – $17 Initial offer is “significantly too low”; target 4.3x – 4.7x EBITDA Noble Capital Markets (1/4/21) $20.75 “Opportunistic lowball bid”; target 5.2x cash flow (raised target price to $20.75 from $17.50 / share) Mason Slaine (spoke with Phil Franklin on 1/5/21) $17+ At least $17 per share; below that better off rejecting and paying a $5 / share special dividend Patrick Soon - Shiong (spoke with Eric Medow on 1/11/21) - Amber proposal looks low; will evaluate any substantive proposal which is endorsed by the Special Committee; noted that $14.25 / share was less than the price he had paid in 2016 ($15 / share) and that the stock had traded through $15 / share; open to signing an NDA and considering a voting agreement Amber - Awaiting a response from the Special Committee; Moelis indicated that they expected a response by the end of this week; Akin and Moelis have forwarded diligence request lists Stewart Bainum , Jr. (1/5/21 letter) - Primary interest in the Baltimore Sun; willing to explore buying 100% of Teal if he cannot reach agreement with Amber on a “fair value” for the Sun Jeremy Halbreich $15 Has been working on preparing a bid since July 2020 and has not been able to secure financing; currently, Jeremy is working with Trive Capital, which is based out of Dallas (middle market private equity); submitted a $15 / share non - binding proposal on 1/13 (financing discussions are at an early stage); in 2018 Jeremy tried to put together an offer for Teal, but was unsuccessful in securing financing Other Potential Acquirers - No inquiry from Gannett, McClatchy or any other parties Party Suggested Deal Price / Share Comments Source: Wall Street research and publicly available sources. 1 Target price. 1 4
Implied Share FV / 2020E Key Price Range Firm Value EBITDA (Post-SBC) Assumptions - Range consistent with current and historical trading levels for Teal, Gannett and Lee; current market values based on 12/24/20 prices - New York Times has 44% LTM digital revenue (versus 19% for Teal); News Corp has other businesses like broadcasting and publishing - Multiple range based on precedent transactions that have been executed since 2011 - Recent transactions (Gannett, Teal minority interest, Berkshire and McClatchy) ranged from 3.4x - 5.5x LTM EBITDA - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (11.2%) – (2.3%) with Teal revenue declining 4.7% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.9%) – (2.1%) with Teal revenue declining 7.5% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.5%) – (1.8%) with Teal revenue declining 7.5% in 2023 - High date: 12/26/2019 - Low date: 03/18/2020 - Current Amber offer value above 52-week high - Current Analyst Price Targets: - High: $17.50 (Noble: 12/17/20) - Low: $15.00 (Huber: 9/11/20) For Reference Only DCF Case A $250 – $363 4.5x – 6.5x$314 – $460 $392 – $586 5.6x – 8.3x Analyst Price Targets 0.1x – 4.2x 52-Week High / Low $5 – $301 $364 – $459 5.0x – 6.4x DCF Case C DCF Case B 3.6x – 5.2x Trading Comparables $217 – $361 3.0x – 5.0x Precedent Transactions $253 – $397 3.5x – 5.5x $5.50 $12.44 $14.13 $16.19 $12.05 $11.09 $13.32 $15.42 $17.99 $21.29 $15.86 $14.91 Teal – Summary Financial Analysis – As Presented on 12/30/20 ($ in millions, except per share values) PROJECT ALINEA Source: Bloomberg, Company filings, FactSet, Thomson SDC and Wall Street research. DCFs based on Teal Case A, Case B, and Case C projections. Note: Values shown exclude upside from New Jersey real estate and IP addresses (Teal Management suggested these could be $30mm, or $0.79 / share, of additional value). 1 Based on $70mm of post - SBC EBITDA in 2020 (multiples adjusted for pensions). $15.00 Huber $17.50 Noble Teal Valuation Summary Amber Initial Offer $14.25 1 5
Teal w/ Pensions Teal w/o Pensions At Market Illustrative Offer Price At Market Illustrative Offer Price Share Price (01/12/2021) $14.86 $14.25 $15.00 $16.00 $17.00 $18.00 $19.00 $20.00 $14.86 $14.25 $15.00 $16.00 $17.00 $18.00 $19.00 $20.00 Implied Premium to Current (4.1%) 0.9% 7.7% 14.4% 21.1% 27.9% 34.6% (4.1%) 0.9% 7.7% 14.4% 21.1% 27.9% 34.6% % Bump vs. $14.25 5.3% 12.3% 19.3% 26.3% 33.3% 40.4% 5.3% 12.3% 19.3% 26.3% 33.3% 40.4% FDSO 37.778 37.770 37.890 37.890 37.890 37.897 37.897 37.904 37.778 37.770 37.890 37.890 37.890 37.897 37.897 37.904 Fully Diluted Equity Value $561 $538 $568 $606 $644 $682 $720 $758 $561 $538 $568 $606 $644 $682 $720 $758 Less: Cash Proceeds from Options (0) – (2) (2) (2) (2) (2) (2) (0) – (2) (2) (2) (2) (2) (2) Equity Value $561 $538 $567 $604 $642 $680 $718 $756 $561 $538 $567 $604 $642 $680 $718 $756 Plus: Pensions 17 17 17 17 17 17 17 17 – – – – – – – – Less: Cash (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) Firm Value $359 $336 $365 $403 $441 $478 $516 $554 $342 $319 $348 $386 $424 $461 $499 $537 FV / LTM Revenue ($793mm / $793mm) 0.5x 0.4x 0.5x 0.5x 0.6x 0.6x 0.7x 0.7x 0.4x 0.4x 0.4x 0.5x 0.5x 0.6x 0.6x 0.7x FV / '19A EBITDA ($75mm / $73mm) 4.8x 4.5x 4.9x 5.4x 5.9x 6.4x 6.9x 7.4x 4.7x 4.4x 4.7x 5.3x 5.8x 6.3x 6.8x 7.3x FV / '20E EBITDA ($72mm / $70mm) 5.0x 4.7x 5.1x 5.6x 6.1x 6.6x 7.2x 7.7x 4.9x 4.5x 4.9x 5.5x 6.0x 6.5x 7.1x 7.6x FV / '21E EBITDA - Mgmt ($109mm / $107mm) 3.3x 3.1x 3.4x 3.7x 4.1x 4.4x 4.8x 5.1x 3.2x 3.0x 3.3x 3.6x 4.0x 4.3x 4.7x 5.0x Multiples At Various Prices / Share ($ in millions, except per share data) PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of January 12, 2021. Balance sheet as of Q4 2020 provided by Teal management. 1 Pro forma for sale of BestReviews . 2 Pro forma for sale of BestReviews . All EBITDA metrics are presented after deducting stock - based compensation expense. The first parameters shown have also been a djusted for a $2mm add back of pension expense. 1 2 2 2 6
CONFIDENTIAL Appendix PROJECT ALINEA
Low High (Street) Price per Share $11.09 $14.91 $14.86 $3.86 $1.43 $18.40 $46.98 % 52 Week High 80.9% 108.8% 98.2% 55.2% 65.3% 95.6% 90.7% Equity Value $419 $563 $561 $560 $86 $10,945 $7,918 Plus: Debt – – 7 1,484 538 1,284 – Plus: Minority Interest & Preferred Stock – – – 4 2 6,667 2 Less: Cash (219) (219) (222) (254) (34) (1,539) (816) Less: Investments (0) (0) (0) (36) (6) (314) (22) Adj. Firm Value Mgmt Street $200 $344 $346 $1,758 $586 $17,044 $7,082 2019A $73 $73 2.7x 4.7x 4.7x 3.9x 3.5x 15.1x 28.5x LTM 64 64 3.1 5.4 5.4 5.5 4.6 16.1 28.4 2020E 70 58 2.8 4.9 6.0 5.4 4.6 16.5 29.8 2021E 107 76 1.9 3.2 4.6 5.0 NA 14.8 23.6 Adj. Firm Value w Pension Obligation $217 $361 $365 $1,875 $662 $17,238 $7,332 2019A $75 $75 2.9x 4.8x 4.9x 4.0x 3.9x 15.3x 27.5x LTM 65 65 3.3 5.5 5.6 5.6 5.2 16.2 27.4 2020E 72 59 3.0 5.0 6.1 5.5 5.2 16.6 28.7 2021E 109 78 2.0 3.3 4.7 5.1 NA 15.0 23.0 '19A - '21E Revenue CAGR (14.2%) (14.2%) (18.6%) (13.3%) NA (8.2%) 3.2% '19A - '21E EBITDA CAGR 20.2% 20.2% 1.7% (12.4%) NA (7.7%) 10.0% '19A EBITDA Margin (post-SBC) 7.8% 7.8% 7.8% 10.9% 19.5% 11.8% 13.7% '20E EBITDA Margin (post-SBC) 9.5% 9.5% 7.9% 9.7% 15.8% 11.8% 13.4% '21E EBITDA Margin (post-SBC) 15.4% 15.4% 12.2% 11.1% NA 13.4% 15.6% Dividend Yield – – – – – 1.1% 0.5% % Digital Revenue (LTM) 19.0% 19.0% 19.0% 18.4% 26.6% NA 44.0% TEAL TEAL Selected Public Comparables ($ in millions, except per share values) APPENDIX PROJECT ALINEA Public Comparables – News Media 4 3 5 2 Source: Company filings, FactSet and Wall Street research. Note: Market values as of January 12, 2021. EBITDA shown on a Post - SBC basis. 1 Balance Sheet as of Q4 2020 per Teal Management. Figures are pro forma for the sale of BestReviews . 2 Balance sheet based on Q3 2020 public filings. Teal Street EBITDA numbers are based on broker projections. Figures are pro fo rma for the sale of BestReviews . 3 Pro forma for the repayment of $647mm of term loan debt using $497mm in proceeds from newly issued convertible notes, $135mm of real estate sales and $15mm of cash announced on December 17, 2020. Digital revenue percentage computed on a pro forma basis for merger with New Media. 4 EBITDA includes 50% of TNI / MNI EBITDA (which is not consolidated for GAAP). 5 Pension expense of $2mm added back to EBITDA and $17mm pension obligation added to Adj. Firm Value (for Teal). 6 News Corp does not fully disclose digital revenues. 1 5 5 6 5 5 5 5 5 7
Letter from Stewart Bainum , Jr. APPENDIX PROJECT ALINEA January 5 , 2021 Special Committee of The Board of Directors Teal Publishing Company 160 N . Stetson Avenue Chicago, IL 60601 Care of Eric Medow, Lazard LLC Ladies and Gentlemen : I write to express my continued interest in the acquisition of The Baltimore Sun Media Group ("The Sun") from Teal Publishing Company . As you know, I have recently discussed the acquisition of The Sun with Amber Global Capital in connection with Amber's proposal to purchase all of the stock in Teal that it does not own . While those discussions are at a preliminary stage and we are hopeful they will soon progress, it is far from certain that they will . If I cannot reach an agreement with Amber on a fair value for The Sun in conjunction with their bid for Teal, I am willing to explore with the Special Committee purchasing all of the outstanding shares of Teal at a reasonable price that will deliver fair value to all Teal shareholders . I have engaged financial, legal and diligence advisors and we are prepared to move expeditiously to complete customary due diligence and negotiate and consummate a mutually acceptable transaction – whether it be for a purchase of the outstanding shares of Teal or for The Sun alone . Please contact me if I can provide any additional information helpful to the Special Committee . Sincerely, Stewart Bainum, Jr . LETTER TO THE TEAL SPECIAL COMMITTEE, 5 JANUARY 2021 8
Trive / Halbreich ($ in millions, except per share values) APPENDIX PROJECT ALINEA SOTP as Presented by Halbreich Source: Halbreich proposal supporting documents. 1 Excludes $11mm of assumed Baltimore EBITDA. 2 Assumed sale price. '21E Multiple Value Market EBITDA Low High Low High Chicago $40 4.25x 5.00x $170 $200 New York (5) 25 35 Hartford 11 4.25 4.50 47 50 Orlando 10 5.00 6.00 50 60 Ft. Lauderdale 10 5.00 6.00 50 60 TCA 4 7.00 8.00 28 32 Allentown 8 4.25 4.50 34 36 VA Pilot 8 4.50 5.00 36 40 Daily Press 8 4.50 5.00 36 40 Total $94 $476 $553 BestReviews Cash 90 90 Teal Cash @ 12/31 125 125 Total Equity Value $691 $768 Shares 36.6 36.6 Price per Share $18.87 $20.97 Baltimore $11 4.55x 4.55x $50 $50 Shares 36.6 36.6 Value per Share $1.37 $1.37 Adjusted Price per Share $20.24 $22.34 Sources & Uses Price / Share $15.00 Assumed Shares 37.0 Equity Value $555 Fees & Expenses 10 Total Uses $565 Baltimore Sale $50 Cash 190 Term Loan 170 Bainum Preferred Equity 15 Trive Preferred Equity 100 Common Equity 40 Total Sources $565 Need 45 days of diligence While SOTP is shown, the proposal does not necessarily assume a sale in pieces (and hence tax leakage) Trive will backstop the term loan Commentary 1 2 2 To be bridged with additional term loan 1.8x EBITDA and ~50% of capitalization – – 9
Project Alinea TEAL SPECIAL COMMITTEE UPDATE FEBRUARY 2021 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT ALINEA CONFIDENTIAL 1
11.00 11.50 12.00 12.50 13.00 13.50 14.00 14.50 15.00 15.50 16.00 16.50 11-Dec-20 22-Dec-20 02-Jan-21 13-Jan-21 24-Jan-21 04-Feb-21 Market Price History PROJECT ALINEA Share Price Evolution Since December 11, 2020 $15.35 / share on 2/4/21 1 12/14/20 Teal receives offer letter from Amber Source: FactSet, Company filings and publicly available sources. Historical stock prices shown are not adjusted for subsequent d ividends paid. Note: Market values as of February 4, 2021. 1 $2.00 of dividends / share paid since 1/1/19. 1/14/21 Special Committee Meeting 12/31/20 BestReviews 8K & EBITDA Guidance; Huber $15 price target 1/4/21 Noble $20.75 price target Volume in Shares (‘000s) 50 49 45 91 70 325 71 82 36 75 65 262 117 457 177 380 141 69 53 49 51 41 78 54 78 54 252 116 120 44 70 138 98 33 43 203 28 – 100 200 300 400 500 Avg. daily trading volume over the last 3 months was 98K shares $ 12/22/20 Special Committee Meeting $14.25 / share Initial Amber offer 12/17/20 Special Committee Meeting $16.00 / share Revised Amber offer 2/4/21 Teal receives revised offer from Amber 12/30/20 Special Committee Meeting & WSJ Article on Amber offer (post - close) 2
Comparables PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as February 4, 2021. The New York Times, News Corporation and Lee multiples have been updated to include any relevant calendar Q4 2020 information contained in their latest earnings announcements (per 8 - Ks released on February 4, 2021). 1 Pro forma for sale of BestReviews . Teal Mgmt. balance sheet as of Q4 2020. Share Price Performance Since December 24, 2020 (20%) 0% 20% 40% 60% 80% 24-Dec-20 1-Jan-21 9-Jan-21 18-Jan-21 26-Jan-21 4-Feb-21 NYT 0.6% S&P500 4.6% NWSA 13.9% LEE 57.6% PF GCI 70.2% Teal 20.4% Teal $12.75 FV / 2020E EBITDA (w/ Pensions) 5.2x 5.8x 5.3x 17.8x 29.9x FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) @ $15.35 3.5x 5.5x NA 16.2x 26.7x 31.6x 16.4x 5.1x 5.0x 12/24/20 Multiples 1 3.9x 25.3x 14.8x NA 4.7x 12/24/20 Multiples 2.6x 12/30/20 Special Committee Meeting & WSJ Article on Amber offer (post - close) Teal ( Mgmt ) @ $15.35 1 GCI equity value rose $280mm since 12/24/20 (14% on a $2.0bn firm value with pensions); Lee equity value rose $41mm since 12/24/20 (6% on a $670mm firm value with pensions) 3
Commentary & Discussions PROJECT ALINEA Huber Research (12/31/20) $16 – $17 Initial offer of $14.25 is “significantly too low”; target 4.3x – 4.7x EBITDA Noble Capital Markets (1/4/21) $20.75 Initial offer is an “opportunistic lowball bid”; target 5.2x cash flow (raised target price to $20.75 from $17.50 / share). $20.75 target price reaffirmed in 1/28/21 report Mason Slaine (spoke with Phil Franklin on 1/5/21) $17+ At least $17 per share; below that better off rejecting and paying a $5 / share special dividend Patrick Soon - Shiong (spoke with Eric Medow on 1/11/21) - Initial Amber proposal looks low; will evaluate any substantive proposal which is endorsed by the Special Committee; noted that $14.25 / share was less than the price he had paid in 2016 ($15 / share) and that the stock had traded through $15 / share; open to signing an NDA and considering a voting agreement Amber $16 Initial offer of $14.25 on 12/14/20; Special Committee counter of $18.25 on 1/15/21; Moelis communicated revised Amber offer of $16 / share to Lazard on 2/4/21 Stewart Bainum , Jr. (1/5/21 letter) - Primary interest in the Baltimore Sun; willing to explore buying 100% of Teal if he cannot reach agreement with Amber on a “fair value” for the Sun ; Bainum has an understanding with Amber on a price for the Sun; following up regularly to check - in AIM / Tides (Jeremy Halbreich) + Trive $15 Submitted a $15 / share non - binding proposal on 1/13; ~$100mm equity hole at $15 / share; in discussions with Trive (2/3) they indicated support for the senior debt and the preferred but not the common (where the shortfall is); in 2018 AIM / Tides tried to put together an offer for Teal, but were unsuccessful in securing financing Other Potential Acquirers - No inquiry from Gannett, McClatchy or any other parties Party Suggested Deal Price / Share Comments Source: Wall Street research and publicly available sources. 1 Target price. 1 4
Address: 125 Theodore Conrad Dr, Jersey City, NJ 07305 Ownership: JV with an affiliate of the Zuckerman family; Teal owns 49.9% Square Footage: ~450,000 (industrial property) Land: 9.9998 acres Tax basis in land of $3.5mm; tax basis in building of $1mm The NJ real estate (expect to exit facility by the end of 2021) has an estimated value of $0.32 - $0.53 / share (assuming a sale at the end of 2022). IP addresses / la.com domain name has an estimated value of $0.08 - $0.12 / share (assuming a sale in 2022). In total, th e two sets of assets have $0.40 to $0.65 per share of value, so we assume $0.60 / share of value. NJ Real Estate and IP Address / Domain Name Valuation Analysis ($ in millions, except per share values) PROJECT ALINEA Real Estate Summary – Assume 2022 Sale IP Address / Domain Name Summary – Assume 2022 Sale Source: Teal Management, Company filings, FactSet, NJ Department of the Treasury, and Real Capital Analytics. Note: Illustrative valuations above exclude transaction costs. NPV’s assume a 10% WACC and that the assets are sold at the end o f 2022 (per Teal Management). 1 Real estate comps include sales of industrial buildings in Jersey City located within one mile of 125 Theodore that occurred aft er 2017 (5 transactions). 2 Taxes on gains computed using a $4.5mm tax basis for the real estate and a $0.8mm tax basis for the la.com domain name and IP ad dresses. 3 A recent prospective buyer noted that the usable square footage at 125 Theodore is approximately 300K square feet based on th eir assessment of the building’s footprint. 4 The low / high valuations are based on Brandsight LLC and Hilco Streambank (IP valuation and consulting advisory firms) reports. 5 Two - character domain name comparables data provided by Brandsight LLC (median / mean metrics suggest values of $2.4mm and $3.6mm, respectively). Teal owns the la.com domain and two /16 IPv4 blocks Teal received a $1.5mm IOI from Live Auctioneers (Nov - 20) for the la.com domain (range of $2mm - $4mm per consulting reports) 4 /16 blocks contain ~65,000 addresses Amazon offered to purchase the /16 blocks for $3.4mm (July - 20), and market data indicates a per address price range of $22 - $26 Tax basis in la.com of $0.8mm; zero tax basis in IP addresses Market Analysis Prior Low Midpoint High Offers la.com $2.0 $3.0 $4.0 $1.5 Two /16 IPv4 Blocks 2.9 3.1 3.4 3.4 Valuation $4.9 $6.1 $7.4 $4.9 Taxes (28%) (1.1) (1.5) (1.9) (1.1) After Tax Value $3.7 $4.6 $5.6 $3.7 FDSO 37.897 37.897 37.897 37.897 Value per Share $0.10 $0.12 $0.15 $0.10 NPV per Share (10% WACC) $0.08 $0.10 $0.12 $0.08 Recent SalesLow Median High Tax Value $ / Sq. Ft. $124.54 $128.21 $141.40 $141.06 Total Valuation (450K Sq. Ft.) $56.0 $57.7 $63.6 $63.5 % Ownership 49.9% 49.9% 49.9% 49.9% Valuation $28.0 $28.8 $31.8 $31.7 Taxes (28%) (6.6) (6.8) (7.6) (7.6) After Tax Value $21.4 $22.0 $24.1 $24.1 FDSO 37.897 37.897 37.897 37.897 Value per Share $0.56 $0.58 $0.64 $0.64 NPV per Share (10% WACC) $0.47 $0.48 $0.53 $0.52 Memo Total Valuation (300K Sq. Ft.) $37.4 $38.5 $42.4 $42.3 After Tax Value to Teal 14.7 15.1 16.5 16.5 Value per Share $0.39 $0.40 $0.44 $0.43 NPV per Share (10% WACC) $0.32 $0.33 $0.36 $0.36 1 2 2 3 5 4 5
Terminal Value – Adjusted Expenses ($ in millions) PROJECT ALINEA Assume 2023 print and digital revenue growth rates apply beyond 2023 Assume EBITDA (post - SBC) margins are held constant at 2023 levels Assume Adjusted Expenses (e.g. restructuring charges) as a percentage of the change in annual Opex is held constant at 2023 levels (the 2023 levels are consistent with historical rates) Calculate the NPV of the after - tax Adjusted Expenses beyond 2023 (until the Opex base begins to grow with revenues) 2023 Print Revenue Growth (13.5%) (16.0%) (16.0%) 2023 Digital Revenue Growth 15.0% 11.9% 11.9% Year Total Revenue Growth is Positive 2026 2027 2027 2023 EBITDA Margin 18.1% 14.3% 11.0% 2023 Adj. Exp. as a % Change in Opex 38.5% 41.0% 42.7% NPV @ 12/31/20 @ 9% WACC $4 $13 $14 NPV @ 12/31/20 @ 10% WACC 4 12 13 NPV @ 12/31/20 @ 11% WACC 4 12 13 Parameter Case A Case B Case C Source: Teal Management. 6
DCF Supporting Detail – Terminal Adjusted Expenses ($ in millions, except per share values) PROJECT ALINEA Source: Teal Management. Terminal Period 2023E 2024E 2025E 2026E 2027E Illustrative Impact to Valuation EBITDA $113 $109 $108 $109 $113 Margin % 18.1% 18.1% 18.1% 18.1% 18.1% NPV of Adj. Expenses @ 12/31/23 $8 (-) Taxes @ 28% (2) Opex $509 $494 $490 $494 $509 NPV of After Tax Adj. Expenses @ 12/31/23 $6 Change in Opex (33) (15) (5) 5 15 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $4 Adj. Expenses $13 $6 $2 – – / FDSO 37.9 % of Change in Opex 38.5% 38.5% 38.5% 38.5% 38.5% Impact per Share @ 12/31/20 $0.11 EBITDA $85 $80 $77 $76 $76 Margin % 14.3% 14.3% 14.3% 14.3% 14.3% NPV of Adj. Expenses @ 12/31/23 $23 (-) Taxes @ 28% (6) Opex $512 $482 $464 $456 $456 NPV of After Tax Adj. Expenses @ 12/31/23 $16 Change in Opex (31) (29) (18) (8) 1 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $12 Adj. Expenses $13 $12 $7 $3 – / FDSO 37.9 % of Change in Opex 41.0% 41.0% 41.0% 41.0% 41.0% Impact per Share @ 12/31/20 $0.33 EBITDA $66 $62 $59 $58 $58 Margin % 11.0% 11.0% 11.0% 11.0% 11.0% NPV of Adj. Expenses @ 12/31/23 $25 (-) Taxes @ 28% (7) Opex $531 $501 $482 $473 $474 NPV of After Tax Adj. Expenses @ 12/31/23 $18 Change in Opex (30) (30) (19) (9) 1 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $13 Adj. Expenses $13 $13 $8 $4 – / FDSO 37.8 % of Change in Opex 42.7% 42.7% 42.7% 42.7% 42.7% Impact per Share @ 12/31/20 $0.36 Case A Case B Case C 7
Illustrative Impact to DCF Valuation PROJECT ALINEA Source: Teal Management. 1 Per page 7, each case is valued assuming the corresponding WACC (9 - 11%). There is no terminal value. Implied Share Price Implied Share Price As Presented on 12/30 RE / IP + Adj. Expenses Impact WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $12.74 $13.41 $14.08 $14.75 $15.42 9.5% 12.66 13.32 13.98 14.64 15.30 10.0% 12.59 13.24 13.89 14.54 15.19 10.5% 12.51 13.15 13.80 14.44 15.08 11.0% 12.44 13.07 13.71 14.34 14.97 Implied Value per Share Implied Share Price $0.60 / share of RE / IP + Adj. Exp. Impact Pro Forma Combined 3.0x 3.5x 4.0x 4.5x 5.0x $0.25 $0.25 $0.25 $0.25 $0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 Implied Share Price Pro Forma Combined 3.0x 3.5x 4.0x 4.5x 5.0x $13.00 $13.66 $14.33 $15.00 $15.67 12.92 13.58 14.24 14.90 15.56 12.84 13.49 14.14 14.79 15.44 12.76 13.41 14.05 14.69 15.33 12.69 13.32 13.96 14.59 15.22 Case C Case B Implied Share Price Implied Share Price As Presented on 12/30 RE / IP + Adj. Expenses Impact WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $14.52 $15.39 $16.25 $17.12 $17.99 9.5% 14.42 15.27 16.13 16.98 17.84 10.0% 14.32 15.16 16.01 16.85 17.69 10.5% 14.22 15.06 15.89 16.72 17.55 11.0% 14.13 14.95 15.77 16.59 17.41 Implied Value per Share Implied Share Price $0.60 / share of RE / IP + Adj. Exp. Impact Pro Forma Combined 3.0x 3.5x 4.0x 4.5x 5.0x $0.28 $0.28 $0.28 $0.28 $0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 0.28 Implied Share Price Pro Forma Combined 3.0x 3.5x 4.0x 4.5x 5.0x $14.80 $15.67 $16.54 $17.40 $18.27 14.70 15.56 16.41 17.26 18.12 14.60 15.44 16.29 17.13 17.97 14.50 15.33 16.17 17.00 17.83 14.40 15.23 16.05 16.87 17.69 Case A Implied Share Price Implied Share Price As Presented on 12/30 RE / IP + Adj. Expenses Impact WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $16.70 $17.84 $18.99 $20.14 $21.29 9.5% 16.57 17.70 18.83 19.96 21.10 10.0% 16.44 17.56 18.67 19.79 20.91 10.5% 16.31 17.41 18.52 19.62 20.72 11.0% 16.19 17.28 18.36 19.45 20.54 Implied Value per Share Implied Share Price $0.60 / share of RE / IP + Adj. Exp. Impact Pro Forma Combined 3.0x 3.5x 4.0x 4.5x 5.0x $0.50 $0.50 $0.50 $0.50 $0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.49 0.49 0.49 0.49 0.49 0.49 0.49 0.49 0.49 0.49 Implied Share Price Pro Forma Combined 3.0x 3.5x 4.0x 4.5x 5.0x $17.20 $18.35 $19.50 $20.64 $21.79 17.07 18.20 19.33 20.46 21.60 16.93 18.05 19.17 20.29 21.40 16.81 17.91 19.01 20.11 21.21 16.68 17.77 18.85 19.94 21.03 1 1 1 8
Implied Share FV / 2020E Key Price Range Firm Value EBITDA (Post-SBC) Assumptions - Range consistent with current and historical trading levels for Teal, Gannett and Lee; current market values based on 02/04/21 prices - New York Times has 46% LTM digital revenue (versus 19% for Teal); News Corp has other businesses like broadcasting and publishing - Multiple range based on precedent transactions that have been executed since 2011 - Recent transactions (Gannett, Teal minority interest, Berkshire and McClatchy) ranged from 3.4x - 5.5x LTM EBITDA - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (11.2%) – (2.3%) with Teal revenue declining 4.7% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.9%) – (2.1%) with Teal revenue declining 7.5% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.5%) – (1.8%) with Teal revenue declining 7.5% in 2023 - High date: 01/22/21; low date: 12/31/20 (through 02/04/21) - Date range begins on the first trading day post public disclosure of the initial Amber offer - High date: 01/21/20; low date: 03/18/20 - Date range ends the day before public disclosure of the initial Amber offer $315 – $396 For Reference Only Post Public Disclosure (12/31/20 - Present) 52-Week High / Low (through 12/30/20) Analyst Price Targets $364 – $582 Trading Comparables $217 – $361 3.0x – 5.0x Precedent Transactions $253 – $397 3.5x – 5.5x DCF Case A $260 – $373 4.6x – 6.7x$325 – $471 $411 – $605 5.8x – 8.6x DCF Case C DCF Case B 3.7x – 5.3x 5.0x – 8.1x $5 – $297 0.1x – 4.1x 4.4x – 5.5x $5.50 $13.70 $12.69 $14.40 $16.68 $12.05 $11.09 $13.23 $15.84 $15.67 $18.27 $21.79 $15.86 $14.91 Teal – Summary Financial Analysis with Updated DCF Valuations ($ in millions, except per share values) PROJECT ALINEA Source: Bloomberg, Company filings, FactSet, Thomson SDC and Wall Street research. DCFs based on Teal Case A and Case B (prepare d by Teal Management) as well as Case C (prepared at the request of the Teal Special Committee). 1 Based on $70mm of post - SBC EBITDA in 2020 (multiples adjusted for pensions). $15.00 Huber $17.50 Noble 1 $16 - $17 Huber Range $20.75 Noble Target - : $17.50 (Noble: 12/17/20) - : $15.00 (Huber: 9/11/20) 01/04/21 Noble Target (reaffirmed 01/28/21) 12/31/20 Huber Range Amber Revised Offer $16.00 Amber Initial Offer $14.25 9
Teal w/ Pensions Teal w/o Pensions Illustrative Offer Price Illustrative Offer Price Initial Revised Initial Revised At Offer Offer At Offer Offer Market (12/14) (2/4) Market (12/14) (2/4) Share Price (02/04/21) $15.35 $14.25 $16.00 $17.00 $17.25 $17.50 $17.75 $18.00 $18.25 $15.35 $14.25 $16.00 $17.00 $17.25 $17.50 $17.75 $18.00 $18.25 Premium to 12/11/20 ($11.90) 19.7% 34.5% 42.9% 45.0% 47.1% 49.2% 51.3% 53.4% 19.7% 34.5% 42.9% 45.0% 47.1% 49.2% 51.3% 53.4% Premium to 12/30/20 ($12.79) 11.4% 25.1% 32.9% 34.9% 36.8% 38.8% 40.7% 42.7% 11.4% 25.1% 32.9% 34.9% 36.8% 38.8% 40.7% 42.7% Premium to Current (7.2%) 4.2% 10.7% 12.4% 14.0% 15.6% 17.3% 18.9% (7.2%) 4.2% 10.7% 12.4% 14.0% 15.6% 17.3% 18.9% % Bump vs. $14.25 12.3% 19.3% 21.1% 22.8% 24.6% 26.3% 28.1% 12.3% 19.3% 21.1% 22.8% 24.6% 26.3% 28.1% FDSO 37.890 37.770 37.890 37.890 37.890 37.897 37.897 37.897 37.897 37.890 37.770 37.890 37.890 37.890 37.897 37.897 37.897 37.897 Fully Diluted Equity Value $582 $538 $606 $644 $654 $663 $673 $682 $692 $582 $538 $606 $644 $654 $663 $673 $682 $692 Less: Cash Proceeds from Options (2) – (2) (2) (2) (2) (2) (2) (2) (2) – (2) (2) (2) (2) (2) (2) (2) Equity Value $580 $538 $604 $642 $652 $661 $671 $680 $690 $580 $538 $604 $642 $652 $661 $671 $680 $690 Plus: Pensions 17 17 17 17 17 17 17 17 17 – – – – – – – – – Less: Cash (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) (219) Firm Value $378 $336 $403 $441 $450 $459 $469 $478 $488 $361 $319 $386 $424 $433 $442 $452 $461 $471 FV / LTM Revenue ($793mm / $793mm) 0.5x 0.4x 0.5x 0.6x 0.6x 0.6x 0.6x 0.6x 0.6x 0.5x 0.4x 0.5x 0.5x 0.5x 0.6x 0.6x 0.6x 0.6x FV / '19A EBITDA ($75mm / $73mm) 5.0x 4.5x 5.4x 5.9x 6.0x 6.1x 6.2x 6.4x 6.5x 4.9x 4.4x 5.3x 5.8x 5.9x 6.0x 6.2x 6.3x 6.4x FV / '20E EBITDA ($72mm / $70mm) 5.2x 4.7x 5.6x 6.1x 6.2x 6.4x 6.5x 6.6x 6.8x 5.1x 4.5x 5.5x 6.0x 6.1x 6.3x 6.4x 6.5x 6.7x FV / '21E EBITDA - Mgmt ($109mm / $107mm) 3.5x 3.1x 3.7x 4.1x 4.1x 4.2x 4.3x 4.4x 4.5x 3.4x 3.0x 3.6x 4.0x 4.1x 4.1x 4.2x 4.3x 4.4x Multiples At Various Prices / Share ($ in millions, except per share data) PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of February 4, 2021. Balance sheet as of Q4 2020 provided by Teal management. 1 Pro forma for sale of BestReviews . 2 Pro forma for sale of BestReviews . All EBITDA metrics are presented after deducting stock - based compensation expense. The first parameters shown have also been a djusted for a $2mm add back of pension expense. 1 2 2 2 10
CONFIDENTIAL Appendix PROJECT ALINEA
Low High (Street) Price per Share $11.09 $14.91 $15.35 $4.68 $1.86 $20.30 $51.68 % 52 Week High 70.0% 94.1% 96.9% 72.3% 95.4% 100.0% 92.0% Equity Value $419 $563 $580 $679 $112 $12,013 $8,711 Plus: Debt – – 7 1,484 524 1,256 – Plus: Minority Interest & Preferred Stock – – – 4 2 6,987 2 Less: Cash (219) (219) (222) (254) (37) (1,562) (898) Less: Investments (0) (0) (0) (36) (6) (353) (22) Adj. Firm Value Mgmt Street $200 $344 $364 $1,877 $594 $18,341 $7,793 2019A $73 $73 2.7x 4.7x 5.0x 4.1x 3.5x 16.3x 31.4x LTM 64 64 3.1 5.4 5.7 5.9 4.3 15.3 31.1 2020E 70 80 2.8 4.9 4.6 5.7 4.7 17.6 31.1 2021E 107 98 1.9 3.2 3.7 5.4 NA 16.0 27.5 Adj. Firm Value w Pension Obligation $217 $361 $384 $1,994 $670 $18,535 $8,043 2019A $75 $75 2.9x 4.8x 5.1x 4.2x 4.0x 16.4x 30.2x LTM 65 65 3.3 5.5 5.9 6.0 4.8 15.4 29.9 2020E 72 82 3.0 5.0 4.7 5.8 5.3 17.8 29.9 2021E 109 100 2.0 3.3 3.8 5.5 NA 16.2 26.7 '19A - '21E Revenue CAGR (14.2%) (14.2%) (15.2%) (13.3%) NA (4.9%) 3.9% '19A - '21E EBITDA CAGR 20.2% 20.2% 15.6% (12.4%) NA 0.8% 6.7% '19A EBITDA Margin (post-SBC) 7.8% 7.8% 7.8% 10.9% 19.5% 11.8% 13.7% '20E EBITDA Margin (post-SBC) 9.5% 9.5% 10.2% 9.7% 15.8% 11.9% 14.1% '21E EBITDA Margin (post-SBC) 15.4% 15.4% 14.5% 11.1% NA 13.3% 14.5% Dividend Yield – – – – – 1.0% 0.5% % Digital Revenue (LTM) 19.0% 19.0% 19.0% 18.4% 26.8% NA 46.4% TEAL TEAL Selected Public Comparables ($ in millions, except per share values) APPENDIX PROJECT ALINEA Public Comparables – News Media 4 3 5 2 Source: Company filings, FactSet and Wall Street research. Note: Market values as of February 4, 2021. EBITDA shown on a Post - SBC basis. The New York Times, News Corporation and Lee figur es have been updated to include any relevant calendar Q4 2020 information contained in their latest earnings announcements (per 8 - Ks released on February 4, 2021). 1 Balance Sheet as of Q4 2020 per Teal Management. Figures are pro forma for the sale of BestReviews . 2 Balance sheet based on Q3 2020 public filings. Teal Street EBITDA numbers are based on broker projections. Figures are pro fo rma for the sale of BestReviews . 3 Pro forma for the repayment of $647mm of term loan debt using $497mm in proceeds from newly issued convertible notes, $135mm of real estate sales and $15mm of cash announced on December 17, 2020. Digital revenue percentage computed on a pro forma basis for merger with New Media. 4 EBITDA includes 50% of TNI / MNI EBITDA (which is not consolidated for GAAP). 5 Pension expense of $2mm added back to EBITDA and $17mm pension obligation added to Adj. Firm Value (for Teal). 6 News Corp does not fully disclose digital revenues. 1 5 5 6 5 5 5 5 5 11
Letter from Stewart Bainum , Jr. APPENDIX PROJECT ALINEA January 5 , 2021 Special Committee of The Board of Directors Teal Publishing Company 160 N . Stetson Avenue Chicago, IL 60601 Care of Eric Medow, Lazard LLC Ladies and Gentlemen : I write to express my continued interest in the acquisition of The Baltimore Sun Media Group ("The Sun") from Teal Publishing Company . As you know, I have recently discussed the acquisition of The Sun with Amber Global Capital in connection with Amber's proposal to purchase all of the stock in Teal that it does not own . While those discussions are at a preliminary stage and we are hopeful they will soon progress, it is far from certain that they will . If I cannot reach an agreement with Amber on a fair value for The Sun in conjunction with their bid for Teal, I am willing to explore with the Special Committee purchasing all of the outstanding shares of Teal at a reasonable price that will deliver fair value to all Teal shareholders . I have engaged financial, legal and diligence advisors and we are prepared to move expeditiously to complete customary due diligence and negotiate and consummate a mutually acceptable transaction – whether it be for a purchase of the outstanding shares of Teal or for The Sun alone . Please contact me if I can provide any additional information helpful to the Special Committee . Sincerely, Stewart Bainum, Jr . LETTER TO THE TEAL SPECIAL COMMITTEE, 5 JANUARY 2021 12
AIM / Tides + Trive ($ in millions, except per share values) APPENDIX PROJECT ALINEA SOTP as Presented by Halbreich Source: AIM / Tides submissions and discussions (as well as discussions with Trive ). 1 Excludes $11mm of assumed Baltimore EBITDA. 2 Assumed sale price. '21E Multiple Value Market EBITDA Low High Low High Chicago $40 4.25x 5.00x $170 $200 New York (5) 25 35 Hartford 11 4.25 4.50 47 50 Orlando 10 5.00 6.00 50 60 Ft. Lauderdale 10 5.00 6.00 50 60 TCA 4 7.00 8.00 28 32 Allentown 8 4.25 4.50 34 36 VA Pilot 8 4.50 5.00 36 40 Daily Press 8 4.50 5.00 36 40 Total $94 $476 $553 BestReviews Cash 90 90 Teal Cash @ 12/31 125 125 Total Equity Value $691 $768 Shares 36.6 36.6 Price per Share $18.87 $20.97 Baltimore $11 4.55x 4.55x $50 $50 Shares 36.6 36.6 Value per Share $1.37 $1.37 Adjusted Price per Share $20.24 $22.34 Sources & Uses Price / Share $15.00 Assumed Shares 37.0 Equity Value $555 Fees & Expenses 10 Total Uses $565 Cash $190 Term Loan 170 Trive Preferred Equity 100 Other Preferred Equity 15 Other Equity 50 AIM / Tides 40 Total Sources $565 Need 45 days of diligence While SOTP is shown, the proposal does not necessarily assume a sale in pieces (and hence tax leakage) Trive will backstop the term loan Commentary 1 2 2 1.8x EBITDA and ~50% of capitalization To be bridged with additional term loan – – $105mm of uncommitted equity 13
Exhibit (c)(5)
Project Alinea BUSINESS PLAN MATERIALS FEBRUARY 2021 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT ALINEA CONFIDENTIAL 1
Business Plan Overview PROJECT ALINEA 2021 Board approved budget: $695mm of revenue and $111mm of EBITDA before stock - based compensation (“SBC”) expense $107mm of EBITDA after SBC versus $67mm in 2020 (margins rise to 15.4% versus 9.0% in 2020) Teal Q3 ’20 margin of 12.3% pro forma for the sale of BestReviews and after deducting SBC expense Historical and forecasted results exclude the financial impact of BestReviews Case A Case B 2022 and 2023 forecasts prepared at the request of the Special Committee (has not been reviewed by the Teal board) 2022 and 2023 revenues equal those used in Case B Margins decline to 13% in 2022 and 11% in 2023 – consistent with Gannett levels in 2019 and 2021 Teal % digital revenues (LTM), ’19A - ’21E revenue CAGR, EBITDA margins (2020) and capex / revenue ratio (2020) are consistent with Gannett’s comparable statistics (see page 10) 2022 and 2023 forecasts prepared by Teal Management (has not been reviewed by the Teal board) 2023 revenues are 4% below those in Case A (2022 revenues are slightly below Case A) Margins decline to 14% by 2023 Case C 2022 and 2023 forecasts prepared by Teal Management (has not been reviewed by the Teal board) Revenues continue to decline and margins rise to 18% by 2023 Blended Case Composite view incorporating 25 % of Case A and 75% of Case B for each line item in 2022 and 2023 Prepared at the request of the Special Committee (has not been reviewed by the Teal board) 2023 revenue declines at 6.8% (same as 2021 revenue declines); EBITDA margins reach 15.3% (versus 15.4% in 2021) 2
$143 $167 $167 $147 $169 $200 $230 $196 $220 $196 $220 $197 $222 1,013 865 779 599 526 453 392 449 377 449 377 450 $381 $1,156 $1,032 $946 $746 $695 $653 $622 $645 $597 $645 $597 $647 $603 - 200 400 600 800 1,000 1,200 $1,400 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Digital Print Business Plan – Revenue & EBITDA ($ in millions) PROJECT ALINEA Revenue Commentary ’21E - ’23E Print declines of 14% - 15% (CAGR) which are worse than ’17A - ’19A levels but better than ’19A - ’21E levels (23% decline in 2020) Digital growth driven by: ( i ) a recovery in digital advertising (recover to ’19A levels by ’22E / ’23E), and (ii) growth in digital circulation (subscriber and ARPU growth) Case A Case B Margins rise from 10% to 15% in ’21E (versus 11% for Gannett) Case A has margins rise to 18% in ’23E Case B has margins decline to 14% in ’23E (News Corp and NY Times level) Case C has margins decline to 11% in ’23E (Gannett levels ) Blended Case margins hold at 15% (comparable to 2021) EBITDA (Post - SBC) $82 $80 $73 $67 $107 $110 $113 $102 $85 $84 $66 $104 $92 - 50 100 150 $200 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Post - SBC EBITDA Margin 7.8% 7.1% 7.7% 9.0% 15.4% 16.9% 18.1% 15.8% 14.3% Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 1 1 1 1 Case C 13.0% 11.0% $952 $1,074 $873 $679 $589 $543 $509 $543 $512 $557 $527 Operating Expenses FTE 3,821 2,863 2,479 2,217 2,106 2,300 2,191 – – NA NA (12.3%) (17.8%) (13.7%) ( 15.4%) ( 15.4%) 2 - Year Trailing Print CAGR Budget Blended Case A Case B Case C Budget Blended $ 543 $ 511 16.1% – 15.3% – ( 14.9%) 3
Unlevered Free Cash Flow ($ in millions) PROJECT ALINEA Selected Free Cash Flow Items Budget Case A Case B Case C Blended 2017A 1 2018A 1 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Revenue $1,156 $1,032 $946 $746 $695 $653 $622 $645 $597 $645 $597 $647 $603 % Growth (10.7%) (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) (7.3%) (7.5%) (7.3%) (7.5%) (7.0%) (6.8%) EBITDA (Post-SBC) $82 $80 $73 $67 $107 $110 $113 $102 $85 $84 $66 $104 $92 % Margin 7.1% 7.8% 7.7% 9.0% 15.4% 16.9% 18.1% 15.8% 14.3% 13.0% 11.0% 16.1% 15.3% Capex ($24) ($33) ($22) ($10) ($6) ($6) ($6) ($6) ($6) ($6) ($6) ($6) ($6) % Revenue (2.1%) (3.2%) (2.3%) (1.3%) (0.9%) (0.9%) (1.0%) (0.9%) (1.0%) (0.9%) (1.0%) (0.9%) (1.0%) Adjusted Expenses2 ($34) ($75) ($36) ($24) ($40) ($12) ($13) ($12) ($13) ($12) ($13) ($12) ($13) Taxes @ 28% $0 $13 ($5) ($12) ($19) ($27) ($27) ($24) ($19) ($19) ($13) ($25) ($21) Unlevered Free Cash Flow3 $21 ($8) $25 $28 $49 $69 $71 $64 $53 $51 $38 $65 $57 % Revenue 1.8% (0.7%) 2.6% 3.7% 7.0% 10.6% 11.4% 10.0% 8.8% 7.9% 6.5% 10.1% 9.5% Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Extraordinary charges related to items such as restructuring charges. 3 See page 12 for comprehensive unlevered free cash flow calculation. 4
Cases A, B and C Versus Projections Prepared In February 2020 ($ in millions) PROJECT ALINEA Revenue Capex EBITDA (Post - SBC) Unlevered Free Cash Flow $1,032 $946 $695 $653 $622 $645 $597 $859 $806 $762 $724 $780 $677 $1,156 $746 $695 $647 $603 500 600 700 800 900 1,000 1,100 $1,200 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 $110 $113 $67 $102 $85 $82 $80 $73 $84 $66 $83 $75 $69 $64 $88 $105 $107 $104 $92 50 60 70 80 90 100 110 $120 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 $69 $71 $28 $64 $53 $21 ($8) $25 $49 $51 $38 $42 $36 $38 $37 ($8) $65 $57 -20 - 20 40 60 80 $100 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Source: Teal Management and Wall Street research. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 1 Noble broker estimates are pro forma for BestReviews . (20) $6 $10 $6 $24 $33 $22 $6 $13 $14 $8 - 10 20 30 $40 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Cases A, B, C, and Blended are equal Cases B and C are equal 2017 – 2019 Actual + 2020 Management Estimate + 2021 Budget February Case C Case B Case A Noble 1 Blended 5
’21E - ’23E Print declines consistent with ’17A - ’19A experience (declined 38% in 2020) Digital advertising in 2019 was hurt by: ( i ) Daily News shift to digital subscriptions, and (ii) Cars.com contract unwind Declined 23% in 2020 and recovers to 2019 levels by 2022 / 2023 Print circulation declined 8.6% in 2020 with similar declines forecasted for ’21E - ’23E (above the ’17A - ’19A levels) Digital circulation is forecasted to double between 2020 and 2023 based on subscriber growth and better churn management, despite less price discounting Traditional Other Revenue (direct mail and print / distribution for peers) declined 25% in 2020 (mid - teens percentage annual declines from ’20E - ’23E) Digital Other (content agency) revenue is held flat from ’20E - ’23E Margins rise from 9.0% in 2020 to 15.4% in 2021 (Q3’20A margins were 12.3% post - SBC) Margins rise to 18.1% by 2023 (margin expansion driven primarily by distribution outsourcing and the reduction in occupancy expense) Teal Financial Projections – Case A ($ in millions, except ARPU data) PROJECT ALINEA Summary of Teal Projections – Case A Case A Observations Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $121 $95 (20.5%) (22.2%) Digital Advertising 97 101 87 67 73 83 93 (5.3%) 12.7% Total Advertising $591 $472 $399 $261 $231 $204 $189 (17.8%) (9.6%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (11.8%) (7.4%) Print Circulation 363 357 337 308 286 263 239 (3.7%) (8.5%) Avg. Subs (000s) 895 792 677 592 515 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.93 Digital Circulation 10 18 29 46 66 86 103 73.7% 25.3% Avg. Subs (000s) 290 384 469 526 579 ARPU (Weekly) $1.92 $2.28 $2.70 $3.13 $3.42 Total Circulation $373 $375 $366 $353 $352 $348 $343 (0.9%) (1.3%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.0%) (1.6%) Traditional Other Revenue 156 137 130 97 83 69 57 (9.0%) (17.0%) Digital Other Revenue 36 49 51 34 30 32 34 18.9% 6.0% Total Other Revenue $192 $186 $181 $132 $113 $101 $91 (3.1%) (10.3%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (10.2%) (10.3%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $653 $622 (9.6%) (5.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) Compensation 435 396 338 265 230 214 206 (11.8%) (5.3%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.5%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 29 6.2% (11.1%) Other Expenses2 129 61 98 73 62 59 57 (13.0%) (4.3%) Total Operating Expenses $1,065 $942 $859 $674 $584 $539 $505 (10.1%) (7.0%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $114 $117 (2.9%) 2.6% YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% 3.1% 2.1% Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 17.5% 18.8% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $110 $113 (5.7%) 2.7% YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% 3.2% 2.2% Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 16.9% 18.1% 6
No changes to 2021 budget Case B revenues are $8mm lower in 2022 (versus Case A) and $26mm lower in 2023 (versus Case A) Roughly half of the revenue reductions come from Advertising with the other half split roughly evenly between Circulation and Other 2023 reductions in Advertising mostly in print (75%) 2023 reductions in Circulation and Other split roughly evenly between Print and Digital Margins decline from 15.4% in 2021 to 14.3% in 2023 (News Corp and New York Times levels) Teal Financial Projections – Case B ($ in millions, except ARPU data) PROJECT ALINEA Summary of Teal Projections – Case B Case B Observations Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $118 $86 (20.5%) (26.2%) Digital Advertising 97 101 87 67 73 82 91 (5.3%) 11.2% Total Advertising $591 $472 $399 $261 $231 $200 $177 (17.8%) (12.6%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (13.4%) (11.7%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (9.0%) Avg. Subs (000s) 895 792 677 592 512 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.88 Digital Circulation 10 18 29 46 66 84 99 73.7% 22.8% Avg. Subs (000s) 290 384 469 526 576 ARPU (Weekly) $1.92 $2.28 $2.70 $3.07 $3.30 Total Circulation $373 $375 $366 $353 $352 $347 $336 (0.9%) (2.3%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.4%) (3.1%) Traditional Other Revenue 156 137 130 97 83 69 54 (9.0%) (18.9%) Digital Other Revenue 36 49 51 34 30 30 30 18.9% (0.7%) Total Other Revenue $192 $186 $181 $132 $113 $98 $84 (3.1%) (13.7%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.9%) (14.5%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $645 $597 (9.6%) (7.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (7.3%) (7.5%) Compensation 435 396 338 265 230 214 207 (11.8%) (5.1%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.8%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 30 6.2% (10.1%) Other Expenses2 129 61 98 73 62 59 57 (13.0%) (3.9%) Total Operating Expenses $1,065 $942 $859 $674 $584 $539 $507 (10.1%) (6.8%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $106 $89 (2.9%) (10.3%) YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% (4.4%) (15.9%) Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 16.5% 15.0% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $102 $85 (5.7%) (10.8%) YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% (4.5%) (16.6%) Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 15.8% 14.3% 7
No changes to 2021 budget Incorporates Case B revenues Target Gannett margins (~11% in 2019 and 2021) by 2023 Current operating similarities highlighted on the left side of page 11 This Case was prepared at the request of the Special Committee Teal Financial Projections – Case C ($ in millions, except ARPU data) PROJECT ALINEA Summary of Teal Projections – Case C Case C Observations Source: Prepared at the request of the Special Committee. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $118 $86 (20.5%) (26.2%) Digital Advertising 97 101 87 67 73 82 91 (5.3%) 11.2% Total Advertising $591 $472 $399 $261 $231 $200 $177 (17.8%) (12.6%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (13.4%) (11.7%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (9.0%) Avg. Subs (000s) 895 792 677 592 512 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.88 Digital Circulation 10 18 29 46 66 84 99 73.7% 22.8% Avg. Subs (000s) 290 384 469 526 576 ARPU (Weekly) $1.92 $2.28 $2.70 $3.07 $3.30 Total Circulation $373 $375 $366 $353 $352 $347 $336 (0.9%) (2.3%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.4%) (3.1%) Traditional Other Revenue 156 137 130 97 83 69 54 (9.0%) (18.9%) Digital Other Revenue 36 49 51 34 30 30 30 18.9% (0.7%) Total Other Revenue $192 $186 $181 $132 $113 $98 $84 (3.1%) (13.7%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.9%) (14.5%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $645 $597 (9.6%) (7.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (7.3%) (7.5%) Compensation 435 396 338 265 230 (11.8%) Circulation Distribution 203 178 171 148 131 (8.1%) Newsprint & Ink 69 68 57 34 27 (9.0%) Outside Services / Printing 174 179 134 103 98 (12.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 6.2% Other Expenses2 129 61 98 73 62 (13.0%) Total Operating Expenses $1,065 $942 $859 $674 $584 $557 $527 (10.1%) (5.1%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $88 $70 (2.9%) (20.8%) YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% (20.8%) (20.7%) Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 13.6% 11.7% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $84 $66 (5.7%) (21.7%) YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% (21.6%) (21.7%) Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 13.0% 11.0% 8
No changes to 2021 budget Composite view incorporating 25% of Case A and 75% of Case B for each line item in 2022 and 2023 2023 revenue declines at 6.8% (same as 2021 revenue declines) EBITDA margins reach 15.3% (versus 15.4% in 2021) This Case was prepared at the request of the Special Committee Teal Financial Projections – Blended Case (25% A + 75% B) ($ in millions, except ARPU data) PROJECT ALINEA Summary of Teal Projections – Blended Case Blended Case Observations Source: Prepared at the request of the Special Committee. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $118 $88 (20.5%) (25.2%) Digital Advertising 97 101 87 67 73 83 91 (5.3%) 11.6% Total Advertising $591 $472 $399 $261 $231 $201 $180 (17.8%) (11.8%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (13.0%) (10.6%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (8.9%) Avg. Subs (000s) 895 792 677 592 513 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.89 Digital Circulation 10 18 29 46 66 85 100 73.7% 23.4% Avg. Subs (000s) 290 384 469 526 577 ARPU (Weekly) $1.92 $2.28 $2.70 $3.09 $3.33 Total Circulation $373 $375 $366 $353 $352 $347 $338 (0.9%) (2.0%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.3%) (2.7%) Traditional Other Revenue 156 137 130 97 83 69 55 (9.0%) (18.4%) Digital Other Revenue 36 49 51 34 30 30 31 18.9% 1.0% Total Other Revenue $192 $186 $181 $132 $113 $99 $86 (3.1%) (12.8%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.2%) (13.4%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $647 $603 (9.6%) (6.9%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (7.0%) (6.8%) Compensation 435 396 338 265 230 214 207 (11.8%) (5.1%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.7%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 30 6.2% (10.3%) Other Expenses2 129 61 98 73 62 59 57 (13.0%) (4.0%) Total Operating Expenses $1,065 $942 $859 $674 $584 $539 $507 (10.1%) (6.9%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $108 $96 (2.9%) (6.9%) YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% (2.5%) (11.2%) Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 16.7% 15.9% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $104 $92 (5.7%) (7.2%) YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% (2.6%) (11.6%) Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 16.1% 15.3% 9
Differences Between Cases – Cases B, C and Blended Relative to Case A ($ in millions) PROJECT ALINEA Gap in Revenue Analysis Gap in Revenue 2021E Versus 2020E 2022E Gap 2023E Gap $ in millions 2021E 2020E Gap Case A Case B Case C Blended A to B A to C A to Blend Case A Case B Case C Blended A to B A to C A to Blend Print Advertising $157 $194 ($37) $121 $118 $118 $118 ($3) ($3) ($2) $95 $86 $86 $88 ($9) ($9) ($7) Digital Advertising 73 67 6 83 82 $82 $83 (0) (0) (0) 93 91 91 91 (3) (3) (2) Total Advertising $231 $261 ($30) $204 $200 $200 $201 ($4) ($4) ($3) $189 $177 $177 $180 ($12) ($12) ($9) Print Circulation 286 308 (22) 263 263 263 263 – – – 239 237 237 237 (3) (3) (2) Digital Circulation 66 46 20 86 84 84 85 (2) (2) (1) 103 99 99 100 (4) (4) (3) Total Circulation $352 $353 ($2) $348 $347 $347 $347 ($2) ($2) ($1) $343 $336 $336 $338 ($7) ($7) ($5) Traditional Other Revenue 83 97 (15) 69 69 69 69 (1) (1) (1) 57 54 54 55 (3) (3) (2) Digital Other Revenue 30 34 (4) 32 30 30 30 (2) (2) (2) 34 30 30 31 (4) (4) (3) Total Other Revenue $113 $132 ($19) $101 $98 $98 $99 ($3) ($3) ($2) $91 $84 $84 $86 ($7) ($7) ($5) Total Operating Revenue $695 $746 ($51) $653 $645 $645 $647 ($8) ($8) ($6) $622 $597 $597 $603 ($26) ($26) ($19) Operating Expenses Operating Expenses as a Percentage of Revenue 2021E Versus 2020E 2022E Gap 2023E Gap $ in millions 2021E 2020E Gap Case A Case B Case C Blended A to B A to C A to Blend Case A Case B Case C Blended A to B A to C A to Blend Compensation 33.0% 35.6% (2.5%) 32.8% 33.2% 33.1% 0.4% (0.3%) 33.1% 34.7% 34.3% 1.6% 1.2% Circulation Distribution 18.8% 19.8% (1.0%) 17.6% 17.8% 17.8% 0.2% (0.2%) 16.6% 17.3% 17.1% 0.7% 0.5% Newsprint & Ink 3.9% 4.5% (0.6%) 3.9% 4.0% 4.0% 0.1% (0.0%) 3.8% 4.0% 3.9% 0.1% 0.1% Outside Services / Printing 14.1% 13.8% 0.3% 14.0% 14.2% 14.1% 0.2% (0.1%) 13.8% 14.4% 14.3% 0.6% 0.4% Occupancy, Insurance / Office Exp. 5.3% 6.8% (1.4%) 5.2% 5.3% 5.2% 0.1% (0.0%) 4.7% 5.0% 4.9% 0.3% 0.2% Other Expenses1 8.9% 9.8% (0.9%) 9.0% 9.1% 9.1% 0.1% (0.1%) 9.1% 9.6% 9.5% 0.5% 0.3% Stock-Based Compensation 0.6% 0.7% (0.1%) 0.6% 0.6% 0.6% 0.0% (0.0%) 0.7% 0.7% 0.7% 0.0% 0.0% Total Operating Expenses 84.6% 91.0% (6.4%) 83.1% 84.2% 87.0% 83.9% 1.1% 3.9% (0.8%) 81.9% 85.7% 89.0% 84.7% 3.9% 7.1% 2.9% EBITDA (Post-SBC) $107 $67 $40 $110 $102 $84 $104 ($8) ($27) ($6) $113 $85 $66 $92 ($28) ($47) ($21) Margin % 15.4% 9.0% 16.9% 15.8% 13.0% 16.1% 18.1% 14.3% 11.0% 15.3% Source: Teal Management. 1 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. 10
Operations In Perspective – Similar to Gannett PROJECT ALINEA % Digital LTM Revenue Days Receivable as of September 30 th , 2020 2 Source: Teal Management, Company filings, FactSet and Wall Street Research. 1 Pro forma for sale of BestReviews . 2 Based on a 365 day year and LTM revenue. 3 Includes A/P, accrued expenses, comp and benefits, as well as deferred revenue (excludes the current portion of debt and leas es and other current liabilities). 4 News Corp does not fully disclose the details of its digital revenues. 2020E EBITDA (Post - SBC) Margin ’19A EBITDA (Post - SBC) Margin 34.9 29.4 23.9 51.5 25.7 1 Teal 7.8% 10.9% 19.5% 11.8% 13.7% 1 Teal 19.1% 37.0% 36.8% 36.8% 36.9% 18.4% 26.8% 46.4% Teal 1 9.0% 18.1% 14.3% 11.0% 15.3% 9.7% 15.8% 12.6% 14.1% 2.5% 5.3% 0.7% 2.3% 1.8% ’19A Capex % Revenue Teal Case A 2023E 1 Teal Case B 2023E 1 1.0% 1.0% Teal Case C 2023E 1 87.2 74.4 55.2 Similar 43.7 55.9 Teal 1 Teal Case A 2023E 1 Teal Case B 2023E 1 Teal Case C 2023E 1 1.0% 14.0% 14.7% NA 15.4% 11.1% ’21E EBITDA (Post - SBC) Margin NA 4 Days Core Current Liabilities as of 9/30/20 2,3 Similar Note: ’19A - ’21E Revenue CAGR (14.2%) Teal ( Mgmt Estimate) (13.3%) Gannett (Street) Teal Blended 2023E 1 1.0% Teal Blended 2023E 1 11
Unlevered Free Cash Flow Build ($ in millions) PROJECT ALINEA Case A Case B Case C Blended Case February Model 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Revenue $1,156 $1,032 $946 $746 $695 $653 $622 $645 $597 $645 $597 $647 $603 % Growth (10.7%) (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) (7.3%) (7.5%) (7.3%) (7.5%) (7.0%) (6.8%) Pre-SBC EBITDA 92 91 86 72 111 114 117 106 89 88 70 108 96 Less: SBC (9) (10) (13) (5) (4) (4) (4) (4) (4) (4) (4) (4) (4) Post SBC EBITDA $82 $80 $73 $67 $107 $110 $113 $102 $85 $84 $66 $104 $92 % Growth (2.3%) (9.0%) (8.2%) 59.1% 3.2% 2.2% (4.5%) (16.6%) (21.6%) (21.7%) (2.6%) (11.6%) % Margin 7.1% 7.8% 7.7% 9.0% 15.4% 16.9% 18.1% 15.8% 14.3% 13.0% 11.0% 16.1% 15.3% Less: D&A ($48) ($51) ($21) ($9) ($8) ($7) ($5) ($7) ($5) ($7) ($5) ($7) ($5) Less: Adjusted Expenses (34) (75) (36) (24) (40) (12) (13) (12) (13) (12) (13) (12) (13) Plus: Property Sales – – 0 10 7 4 – 4 – 4 – 4 – EBT ($0) ($45) $16 $44 $66 $95 $95 $87 $67 $69 $48 $89 $74 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes 0 13 (5) (12) (19) (27) (27) (24) (19) (19) (13) (25) (21) NOPAT ($0) ($33) $12 $32 $48 $69 $68 $63 $48 $50 $34 $64 $53 Plus: D&A $48 $51 $21 $9 $8 $7 $5 $7 $5 $7 $5 $7 $5 Plus: Change in NWC (6) 4 10 (3) (2) (0) 3 1 5 1 5 0 4 Plus: SBC1 5 5 7 3 2 2 2 2 2 2 2 2 2 Less: Capex (24) (33) (22) (10) (6) (6) (6) (6) (6) (6) (6) (6) (6) % Capex / Revenue 2.1% 3.2% 2.3% 1.3% 0.9% 0.9% 1.0% 0.9% 1.0% 0.9% 1.0% 0.9% 1.0% Less: Pension Contribution (2) (3) (4) (4) (2) (2) (2) (2) (2) (2) (2) (2) (2) Plus: Tax Benefit from Pension Cont. 0 1 1 1 1 1 1 1 1 1 1 1 1 Unlevered Free Cash Flow $21 ($8) $25 $28 $49 $69 $71 $64 $53 $51 $38 $65 $57 % Growth n.m. n.m. 13.6% 74.0% 42.9% 2.0% 32.3% (18.1%) 5.2% (24.6%) 34.9% (12.8%) UFCF Conversion % 1.8% (0.7%) 2.6% 3.7% 7.0% 10.6% 11.4% 10.0% 8.8% 7.9% 6.5% 10.1% 9.5% Source: Teal Management, Company filings, FactSet and Wall Street Research. Note: Pro forma for sale of BestReviews . 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). Teal UFCF Build and Case Comparison 12
Project Alinea FLASH UPDATE MATERIALS FEBRUARY 2021 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT ALINEA CONFIDENTIAL 1
Flash Update Versus Board Approved Budget ($ in millions) PROJECT ALINEA Q1 Q2 Q3 Q4 Total Budget Revenue (2021) $172.3 $171.4 $170.4 $181.4 $695.5 Growth Over 2020 Actual (34.2) (0.3) (5.1) (11.2) (50.8) Flash Update Revenue (2021) $171.5 $171.8 $171.3 $182.3 $696.9 Change vs. Budget (0.8) 0.4 0.9 0.9 1.5 Budget Adjusted Pre-SBC EBITDA (2021) $21.8 $26.1 $27.2 $36.0 $111.0 Growth Over 2020 Actual 12.3 13.2 5.1 8.1 38.6 Flash Update Pre-SBC EBITDA (2021) $21.5 $27.2 $29.0 $37.8 $115.5 Change vs. Budget (0.3) 1.1 1.9 1.9 4.5 Source: Teal Management The Flash Update (which was sent to Amber / Moelis in late January) called for lower Q1 numbers (versus the Board approved Budget). Nevertheless, the Q2 – Q4 estimates increased due to cost reductions (primarily). These Q2 – Q4 cost reductions are a p ull forward of cost reductions contemplated later in the business plan forecasts (versus incremental cash flow). Given the Q1 dec lin es and the historical volatility in these Flash estimates (see next page), these Flash views are uncertain. Teal Management rema ins highly confident in their ability to achieve the Board Approved Budget from December. 2
Flash Update History Over Time – History Of Volatility ($ in millions) PROJECT ALINEA 2019 Annual Revenue 2020 Annual Revenue 2019 Annual Adj . EBITDA (Pre - SBC) 2020 Annual Adj . EBITDA (Pre - SBC) $1,000 $998 $993 $994 $992 $989 $986 $987 $985 $983 975 985 995 1,005 1,015 1,025 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Dec-19 Source: Teal Management. Note: Financials include BestReviews . Flash $903 $902 $821 $806 $809 $808 $804 $802 $801 $801 775 825 875 925 Jan-20 Mar-20 May-20 Jul-20 Sep-20 Dec-20 $105 $105 $107 $102 $102 $105 $105 $102 $101 95 100 105 110 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Dec-19 $105 $105 $105 $87 $89 $90 $97 $102 $102 $103 $102 $101 $101 85 90 95 100 105 110 Jan-20 Mar-20 May-20 Jul-20 Sep-20 Dec-20 $ $ $ $ Board Approved Budget Actual 3
Exhibit (c)(6)
Project Alinea SPECIAL COMMITTEE DISCUSSION MATERIALS FEBRUARY 2021 CONFIDENTIAL
The information herein has been prepared by Lazard Frères & Co . LLC (“Lazard”) based upon information supplied by you (“Teal” or the “Company”) or publicly available information, and portions of the information herein may be based upon certain statements, estimates and forecasts provided by the Company with respect to the anticipated future performance of the Company . Lazard has relied upon the accuracy and completeness of the foregoing information, and has not assumed any responsibility for any independent verification of such information or any independent valuation or appraisal of any of the assets or liabilities of the Company or any other entity, or concerning solvency or fair value of the Company or any other entity . With respect to financial forecasts, Lazard has assumed that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of the relevant entity ; we assume no responsibility for and express no view as to such forecasts . The information set forth herein is based upon economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, unless indicated otherwise . These materials and the information contained herein are confidential and may not be disclosed publicly or made available to third parties without the prior written consent of Lazard ; provided, however, that you may disclose to any and all persons the U . S . federal income tax treatment and tax structure of any transaction described herein and the portions of these materials that relate to such tax treatment or structure . Lazard is acting as investment banker to the Special Committee of the Board of Directors of the Company (the “Special Committee”), and will not be responsible for and will not provide any tax, accounting, actuarial, legal or other specialist advice . These materials are preliminary and summary in nature and do not include all of the information that the Special Committee should evaluate in considering a possible transaction . Lazard has been retained only by the Special Committee in connection with the transaction described herein and has no duties to any third party . Nothing herein shall constitute a commitment or undertaking on the part of Lazard or any related party to provide any service . Disclaimer PROJECT ALINEA CONFIDENTIAL 1
Table of Contents PROJECT ALINEA CONFIDENTIAL I EXECUTIVE SUMMARY 2 APPENDIX A Appendix – Public Comparables 9 B Appendix – Precedent Transactions 17 C Appendix – Business Plan 21 D Appendix – DCF 34 E Appendix – WACC 46 F Appendix – Other Potential Parties 49 G Appendix – Teal Shareholders 54 H Appendix – Offer Price Multiples 55
CONFIDENTIAL I Executive Summary PROJECT ALINEA
Deal Terms – Amber to Acquire Teal ($ in millions, except per share values) I EXECUTIVE SUMMARY PROJECT ALINEA Buyer Amber Global Capital, LLC (“Amber”) Amber owns 32% of Teal and a majority interest in the MediaNews Group (“MNG”) Price Per Share $17.25 per Teal share in cash Premium The final offer price is a 35% premium to the 12/30/20 closing price (undisturbed), a 45% premium to the price the day prior to the initial offer on 12/14/20 and an 8% premium to the 2/12/21 close The final offer price represents a 21% increase to the initial offer price of $14.25 Implied Firm Value & EBITDA Multiples Fiduciary - Out Customary fiduciary - out provisions with a $20 million break fee Amber Financing Amber intends to finance the transaction (~$475mm with fees and expenses) with cash on hand at Teal and $375mm in committed equity financing from Amber (no third - party financing or financing conditions) Financing will come from Amber Global Opportunities Master Fund, L.P. and Amber Global Value Recovery Fund, L.P., which currently have $570mm in total assets and ~$560mm of partners’ capital (these levels are slightly below those shown on the 2019 audited balance sheet). The proposed transaction requires ~$100mm of Teal cash versus ~$190mm of unrestricted cash on Teal’s balance sheet. Amber has a non - binding agreement to sell the Baltimore Sun to Stewart Bainum , Jr. (the “Investor”). Amber’s offer is not contingent on the completion of the Baltimore sale Approval Process Amber proposal conditioned on approval by the Special Committee and approval by a vote of two - thirds of the outstanding non - Amber shares Source: Teal Management. 1 Firm value includes the pension liability. EBITDA metrics are presented after stock - based compensation expense and adjusted fo r the add back of $2mm of pension expense. Final Offer Share Price $17.25 $14.25 $18.25 Equity Value $649 $536 $687 Firm Value1 $445 $332 $483 '20E Multiple (EBITDA of $69mm)1 6.5x 4.8x 7.0x '21E Multiple (EBITDA of $109mm)1 4.1 3.1 4.4 '23E Multiple - Blended Case (EBITDA of $94mm)1 4.8 3.5 5.2 2
Commentary & Discussions With Other Potential Parties I EXECUTIVE SUMMARY PROJECT ALINEA Huber Research (12/31/20) $16 – $17 Initial offer of $14.25 is “significantly too low”; target 4.3x – 4.7x EBITDA Noble Capital Markets (1/4/21) $20.75 Initial offer is an “opportunistic lowball bid”; target 5.2x cash flow (raised target price to $20.75 from $17.50 / share). $20.75 target price reaffirmed in 1/28/21 report Mason Slaine (spoke with Phil Franklin on 1/5/21) $17+ At least $17 per share; below that better off rejecting and paying a $5 / share special dividend Patrick Soon - Shiong (spoke with Eric Medow on 1/11/21) - Initial Amber proposal looks low; will evaluate any substantive proposal which is endorsed by the Special Committee; noted that $14.25 / share was less than the price he had paid in 2016 ($15 / share) and that the stock had traded through $15 / share Stewart Bainum , Jr. (1/5/21 letter) - Primary interest in the Baltimore Sun; willing to explore buying 100% of Teal if he cannot reach agreement with Amber on a “fair value” for the Sun; with the Teal Special Committee’s permission, Amber and Bainum agreed on the terms for the sale of the Sun (non - binding term sheet expected at Amber / Teal signing) AIM / Tides (Jeremy Halbreich) + Trive $15 Submitted a $15 / share non - binding proposal on 1/13; ~$100mm equity hole at $15 / share; in discussions with Trive (2/3/21) they indicated support for the senior debt and the preferred but not the common (where the shortfall is); 2/13/21 AIM / Tides indicated that they had a term sheet for $65mm of equity from an unnamed source; still $154mm short at $17.25 / share; in 2018 AIM / Tides submitted a non - binding indication on the final bid date The Shareholder Forum - Lazard spoke to Gary Lutin (Chairman); he requested access to NPI in order to decide what pieces of Teal he might be interested in pursuing; Lutin has no significant equity capital Other Potential Acquirers - No inquiry from Gannett, McClatchy or any other parties Party Suggested Deal Price / Share Comments Source: Wall Street research and publicly available sources. 1 Target price. 1 3
Timeline of Negotiations With Amber I EXECUTIVE SUMMARY PROJECT ALINEA December 14, 2020 $14.25 - Teal receives the initial offer of $14.25 per share from Amber December 31, 2020 $14.25 - Amber files a 13 - D disclosing the initial offer January 15, 2021 - $18.25 Teal’s Special Committee responds to Amber with a price of $18.25 January 16 — February 2, 2021 - - Amber provided limited diligence (primarily near - term cash items) February 4, 2021 $16.00 - Following diligence, Moelis , Amber’s financial advisor, delivers a $16.00 per share offer to Lazard February 5, 2021 - $17.75 Teal’s Special Committee meets; Lazard delivers a $17.75 per share proposal to Moelis; Lazard makes clear that a transaction will not have a financing condition (including terms related to a Baltimore sale or installing a revolver) and Amber’s diligence will be limited to a confirmatory public company standard February 6, 2021 $16.50 $17.25 - $17.50 Amber agrees to the non - price points (i.e., financing condition and diligence standard) and raises their offer price to $16.50 per share ( Moelis to Lazard) Teal’s Special Committee Chairman tells Amber (Randall Smith) that an offer between $17.25 and $17.50 would likely be supported by the Committee February 7, 2021 $17.00 - Amber (Randall Smith) responds by raising their offer to $17.00 per share (speaks to Teal Committee Chairman) February 8, 2021 $17.25 $17.25 Teal’s Special Committee meets; Committee Chairman delivers a $17.25 per share price proposal to Randall Smith Amber (Randall Smith) agrees to a $17.25 per share price (speaks to Teal Committee Chairman) Date Amber Proposal Comments Teal Response 4
11.00 11.50 12.00 12.50 13.00 13.50 14.00 14.50 15.00 15.50 16.00 16.50 17.00 17.50 18.00 11-Dec-20 23-Dec-20 05-Jan-21 17-Jan-21 30-Jan-21 12-Feb-21 Market Price History I EXECUTIVE SUMMARY PROJECT ALINEA Share Price Evolution Since December 11, 2020 $15.95 / share on 2/12/21 1 12/14/20 Teal receives offer letter from Amber Source: FactSet, Company filings and publicly available sources. Historical stock prices shown are not adjusted for subsequent d ividends paid. Note: Market values as of February 12, 2021. 1 $2.00 of dividends / share paid since 1/1/19. 1/14/21 Special Committee Meeting 12/31/20 BestReviews 8K & EBITDA Guidance; Huber $15 price target 1/4/21 Noble $20.75 price target Volume in Shares (‘000s) Avg. daily trading volume over the last 3 months was 101K shares $ 12/22/20 Special Committee Meeting $14.25 / share Initial Amber offer 1 12/17/20 Special Committee Meeting 12/30/20 Special Committee Meeting & WSJ Article on Amber offer (post - close) $17.25 / share Final Amber offer 1 2/8/21 Special Committee Meeting; Teal receives final Amber offer 2/4/21 Teal receives revised offer of $16.00 / share 50 49 45 91 70 325 71 82 36 75 65 262 117 457 177 380 141 69 53 49 51 41 78 54 78 54 252 116 120 44 70 138 98 33 43 203 28 36 39 16 69 331 208 – 100 200 300 400 500 5
Comparables I EXECUTIVE SUMMARY PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as February 12, 2021. The current New York Times, News Corporation and Lee multiples have been updated to in clude any relevant calendar Q4 2020 information contained in their latest financial releases and reports (per 8 - Ks / 10 - Qs released through February 12, 2021). 1 Pro forma for sale of BestReviews . Teal Management balance sheet as of Q4 2020. Share Price Performance Since December 30, 2020 (30%) (10%) 10% 30% 50% 70% 90% 110% 30-Dec-20 7-Jan-21 16-Jan-21 25-Jan-21 3-Feb-21 12-Feb-21 NYT (5.2%) S&P500 5.4% NWSA 31.6% LEE 82.3% PF GCI 81.4% Teal 24.7% Teal $12.79 FV / 2020E EBITDA (w/ Pensions) 5.7x 6.1x 5.5x 18.6x 28.2x FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) @ $15.95 3.6x 5.7x NA 16.0x 26.0x 31.7x 16.6x 5.1x 5.1x 12/30/20 Multiples 1 4.0x 25.5x 15.0x NA 4.8x 12/30/20 Multiples 2.5x 12/30/20 Special Committee Meeting & WSJ Article on Amber offer (post - close) Teal ( Mgmt ) @ $15.95 1 GCI equity value rose $342mm since 12/30/20 (16% on a $2.1bn firm value with pensions); Lee equity value rose $62mm since 12/30/20 (9% on a $693mm firm value with pensions) 6
Implied Share FV / 2020E Key Price Range Firm Value EBITDA (Post-SBC) Assumptions - Range consistent with current and historical trading levels for Teal, Gannett and Lee; current market values based on 02/12/21 prices - New York Times has 46% LTM digital revenue (versus 19% for Teal); News Corp has other businesses like broadcasting and publishing - Multiple range based on precedent transactions that have been executed since 2011 - Recent transactions (Gannett, Teal minority interest, Berkshire and McClatchy) ranged from 3.4x - 5.5x LTM EBITDA - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (11.0%) – (2.2%) with Teal revenue declining 6.8%% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (11.2%) – (2.3%) with Teal revenue declining 4.7% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.9%) – (2.1%) with Teal revenue declining 7.5% in 2023 - WACC: 9.00% – 11.00% - Terminal multiple of 3.0x – 5.0x 2023E EBITDA - Implied perpetuity growth rate of (10.5%) – (1.8%) with Teal revenue declining 7.5% in 2023 - High date: 02/12/21; low date: 12/31/20 (through 02/12/21) - Date range begins on the first trading day post public disclosure of the initial Amber offer - High date: 01/21/20; low date: 03/18/20 - Date range ends the day before public disclosure of the initial Amber offer DCF Case A For Reference Only Trading Comparables $207 – $344 3.0x – 5.0x Precedent Transactions $241 – $379 3.5x – 5.5x $2 – $293 $311 – $396 DCF Case C Post Public Disclosure (12/31/20 - Present) 52-Week High / Low (through 12/30/20) Analyst Price Targets $360 – $578 $260 – $373 4.8x – 7.0x$325 – $471 $347 – $505 5.2x – 7.5x 3.9x – 5.5x 4.5x – 5.7x $411 – $605 6.1x – 9.0x Blended DCF: 25% Case A + 75% Case B DCF Case B 5.2x – 8.4x 0.0x – 4.3x $5.50 $13.70 $12.80 $14.52 $16.80 $15.10 $11.85 $10.93 $13.23 $15.95 $15.79 $18.38 $21.90 $19.27 $15.50 $14.59 Teal – Summary Financial Analysis with Updated DCF Valuations ($ in millions, except per share values) I EXECUTIVE SUMMARY PROJECT ALINEA Source: Bloomberg, Company filings, FactSet, Thomson SDC and Wall Street research. DCFs based on Teal Case A and Case B (prepare d by Teal Management) as well as Case C and the Blended Case (prepared at the request of the Teal Special Committee). 1 Based on $69mm of post - SBC EBITDA in 2020 (multiples adjusted for pensions). $15.00 Huber $17.50 Noble 1 $16 - $17 Huber Range $20.75 Noble Target - : $17.50 (Noble: 12/17/20) - : $15.00 (Huber: 9/11/20) 01/04/21 Noble Target (reaffirmed 01/28/21) 12/31/20 Huber Range Initial Offer $14.25 Final Offer $17.25 7
Reference Range Reference Range Low High Low High Teal Current Share Price $15.95 $15.95 $15.95 $15.95 Premium / (Discount) (31.5%) (8.5%) (25.7%) (2.8%) Implied Equity Value Per Share $10.93 $14.59 $11.85 $15.50 FDSO 37.611 37.617 37.611 37.887 Fully Diluted Equity Value $411 $549 $446 $587 (-) Cash Proceeds from Options – (0) – (4) Equity Value $411 $549 $446 $583 Plus: Total Debt – – – – Plus: Pensions 17 17 17 17 Less: Cash and Equivalents (221) (221) (221) (221) Less: Investments – – – – Implied Firm Value $207 $344 $241 $379 FV / EBITDA (post-SBC) Metric 2020E $69 3.0x 5.0x 3.5x 5.5x 2021E 109 1.9 3.2 2.2 3.5 Implied Multiple of Revenue Metric 2020E $746 0.3x 0.5x 0.3x 0.5x 2021E 695 0.3 0.5 0.3 0.5 Public Comparables Precedents I EXECUTIVE SUMMARY PROJECT ALINEA Source: Company filings, FactSet and Wall Street research. Note: Market values as of February 12, 2021. 1 Metrics per Teal Management. Post - SBC EBITDA has $2mm of pension expense added back. 2 Multiple reflects pensions of $293mm. Implied Teal Prices – Public Comparables & Precedent Transactions ($ in millions, except per share values) Illustrative Valuation Selected ranges based on Appendix Tab A and Tab B 1 1 Gannett and Lee Trading Multiples 1/1/18 – 12/30/20 2019 / 2020 Newspaper Precedents – LTM EBITDA Multiples 4.8x 4.4x 3.6x 3.4x 0.5x 0.4x 0.6x 0.4x LTM Revenue 5.5x 2 Acquiror Target Chatham Asset Mgmt. (Michael Ferro 25% stake) Page 17 has the complete list of precedents Date August 2019 November 2019 January 2020 July 2020 2.0 3.0 4.0 5.0 6.0 7.0x Jan-18 Aug-18 Mar-19 Oct-19 May-20 Dec-20 SA GCI LTM PF GCI LTM SA GCI NTM PF GCI NTM November 19, 2019 New Media / Gannett merger closes 5.0x 3.0x Lee LTM 8
CONFIDENTIAL Appendix PROJECT ALINEA
CONFIDENTIAL A Appendix – Public Comparables PROJECT ALINEA
- 5.00 10.00 15.00 20.00 $25.00 Jan-19 May-19 Oct-19 Mar-20 Aug-20 Dec-20 Teal Stock Price Performance A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Share Price Evolution from January 1, 2019 to December 30, 2020 $12.79 / share on 12/30/20 ($2.00 of dividends / share paid since 1/1/19) 5/30/19 Teal declares a one - time dividend of $1.50 per share Source: FactSet, Company filings and publicly available sources. Historical stock prices shown are not adjusted for subsequent d ividends paid. Note: Market values as of December 30, 2020 (last undisturbed pricing date). 1/14/19 Gannett approached by Amber with hostile bid 8/5/19 Gannett and New Media announce merger 1/17/19 Teal CEO Dearborn to step down 11/14/19 Teal declares regular quarterly dividend of $0.25/share (ex - dividend on 11/25/19) 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 11/25/19 Amber files Schedule13D noting its stake increased to 32% Low closing price of $5.50 (on 3/18/20) 12/2/19 Standstill agreement with Amber signed 2/3/20 Chairman and CEO change + removal of BestReviews Put / Call 2/19/20 Pre - COVID S&P 500 High; Teal declares quarterly dividend of $0.25 / share 7/28/20 Board learns of discussions regarding Mr. Slaine’s acquisition of Mr. Soon - Shiong’s shares; Shareholder Rights Plan put into place, expiration on 7/27/21 7/2/20 Teal elects Randall Smith to Board of Directors 3/18/20 Mason Slaine acquires 6.9% stake 5/12/20 Teal suspends dividend 12/16/20 Teal to sell 100% of BestReviews to Nexstar for $160mm Period (Actual Days) Price $17.25 Implied Premium Current (12/30) $12.79 34.9% 52-Week Low 5.50 213.6% 52-Week High 13.23 30.4% 10 Day VWAP 14.16 21.8% 20 Day VWAP 13.88 24.3% 30 Day VWAP 13.70 25.9% 60 Day VWAP 13.34 29.3% 90 Day VWAP 12.97 33.0% 180 Day VWAP 11.16 54.5% 365 Day VWAP 10.42 65.5% 9
(120%) (100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100% 120% 140% Jan-19 Feb-19 Apr-19 Jun-19 Aug-19 Sep-19 Teal Share Price Performance Relative to Peers A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Source: FactSet and Bloomberg. Note: Market values as of September 30, 2019 and December 30, 2020 (last undisturbed pricing date), respectively. 1 Stock closing price as of January 1, 2019. 2 Stock closing price as of September 30, 2019. Share Price Performance January 1, 2019 to September 30, 2019 S&P500 18.7% NWSA 22.6% LEE (3.3%) PF GCI (23.9%) Teal (24.3%) Teal¹ $11.34 SA GCI 25.9% Share Price Performance September 30, 2019 to December 30, 2020 (120%) (100%) (80%) (60%) (40%) (20%) 0% 20% 40% 60% 80% 100% 120% 140% Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 2/19/20 Pre - COVID S&P 500 High; Teal declares quarterly dividend of $0.25 / share Teal 2 $8.58 NYT 27.8% 10
Teal (Street) Teal (Street) Comparables Benchmarking – Teal @ $12.79 / Share (As of 12/30/20) FV / 2019A EBITDA (w/ Pensions) A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of December 30, 2020 (last undisturbed pricing date). 1 Pro forma for sale of BestReviews . Teal Management balance sheet as of Q4 2020. Teal Street balance sheet as of Q3 2020. 2 Current Net Debt / 2020E EBITDA (EBITDA is Pre - SBC and the ratio is not adjusted for pensions). 3 Not shown due to lack of 2021E estimates. FV / 2020E EBITDA (w/ Pensions) FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) 2.5x 4.0x 4.8x NA 15.0x 25.5x 3 13.7% 11.8% 19.5% 7.8% 10.9% 13.4% 11.8% 15.8% 8.9% 9.7% 15.6% 13.4% NA 10.9% 11.1% — — 3.9x — 3.5x ’20E Net Leverage 3.7x 3.7x 3.9x 15.3x 30.4x FV / LTM EBITDA (w/ Pensions) 4.2x 5.2x 5.1x 16.2x 30.3x ’19A Margin ’20E Margin 9.0% ’21E Margin 15.4% Teal ( Mgmt ) 1 1 1 44.0% NA 26.6% 19.1% 18.4% % LTM Digital Revenue Teal 1 Teal Teal margins jump to the high - end of the comparable range in all cases 1 1 — 2 4.0x 4.2x 5.1x 5.1x 16.6x 31.7x 11
Min Median Max Lee LTM¹ 3.9x 4.7x 5.4x SA GCI LTM 3.2x 3.7x 4.5x SA GCI NTM 3.3x 4.0x 5.2x PF GCI LTM 4.6x 5.3x 6.6x PF GCI NTM 3.4x 4.3x 5.1x 2.0 3.0 4.0 5.0 6.0 7.0x Jan-18 Aug-18 Mar-19 Oct-19 May-20 Dec-20 Lee LTM SA GCI LTM PF GCI LTM SA GCI NTM PF GCI NTM 5.0x Gannett and Lee EBITDA Multiples 1/1/18 – 12/30/20 A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA August 5, 2019 Gannett and New Media announce merger January 14, 2019 MNG announces hostile takeover bid November 19, 2019 New Media / Gannett merger closes May 16, 2019 Gannett shareholders reelect Gannett's independent director nominees after proxy fight with MNG Source: FactSet . Note: Market values as of December 30, 2020 (last undisturbed pricing date). Multiples reflect Adj. Firm Value incl. Pensions. 1 Forward looking projections for Lee not available. 3.0x January 28, 2020 Lee announces agreement to purchase Berkshire Hathaway's newspapers February 19, 2020 Market high before COVID - 19 12
Teal Analyst Price Targets and EBITDA Multiples A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Premium / Price Discount Broker Date Rating Target to Current Noble Capital Markets 1/4/2021 Buy 20.75 30.1% Huber Research Partners 12/31/2020 Buy 16.50 3.4% Cowen & Company Share Price (2/12/21) $15.95 – 52 Week High 13.23 (17.1%) 52 Week Low 5.50 (65.5%) No longer active Source: FactSet and Bloomberg. Note: Market values as of December 30, 2020 (last undisturbed pricing date). Multiples reflect Adj. Firm Value incl. Pensions. 1 Noble price target reaffirmed as of January 28, 2021. Huber provided a range of $16 - $17 per share. The 52 week low / high ra nge is as of December 30, 2020 (last undisturbed pricing date). Teal Analyst Price Targets 1 Teal Analyst Commentary 1 “[AMBER], which already owns 31 . 6 % of TEAL stock, announced a so - called non - binding proposal to acquire a balance of TEAL’s stock for $ 14 . 25 per share [ … ] Our initial reaction is that this offer is significantly too low [ … ] For TEAL, something more in the $ 16 . 00 - $ 17 . 00 per share range makes more sense to us . ” HUBER RESEARCH PARTNERS, 31 DECEMBER 2020 “We are raising our price target from $ 17 . 50 to $ 20 . 75 . Our target multiple remains the same at 5 . 2 times cash flow and reflects the value of the company's real estate holdings, its strong cash generating abilities, and transition toward a Digital business . ” NOBLE CAPITAL MARKETS, 4 JANUARY 2021 2.0 3.0 4.0 5.0 6.0 7.0 8.0x Jan-19 May-19 Oct-19 Mar-20 Aug-20 Dec-20 NTM LTM Teal NTM and LTM EBITDA Multiple Evolution from January 1, 2019 to December 30, 2020 5.0x 3.0x 5/30/19 Teal declares a one - time dividend of $1.50 per share 8/5/19 Gannett and New Media announce merger 11/19/19 Michael Ferro’s fund, Merrick Ventures, sells its shares of Teal (25% stake) to Amber for $13.00 per share (36% premium to 11/18/19 closing price) 1/14/19 Gannett approached by Amber with hostile bid 11/25/19 Amber files Schedule 13D noting its stake increased to 32% 12/2/19 Standstill agreement with Amber signed 11/14/19 Teal declares quarterly dividend of $0.25 per share (ex - dividend on 11/25/19) 2/3/20 Chairman and CEO change + removal of BestReviews Put / Call 2/19/20 Pre - COVID S&P 500 High, Teal declares quarterly dividend of 25 cents 7/2/20 Randall Smith elected to Board of Directors 7/28/20 Board learns of discussions regarding Mr. Slaine’s acquisition of Mr. Soon - Shiong’s shares; Shareholder Rights Plan put into place, expiration on 7/27/21 12/16/20 Teal to sell 100% of BestReviews to Nexstar for $160mm 13
Low High (Street) Price per Share $10.93 $14.59 $12.79 $2.90 $1.24 $18.03 $51.59 % 52 Week High 82.6% 110.3% 96.7% 41.5% 56.6% 96.5% 99.9% Equity Value $411 $549 $481 $421 $74 $10,766 $8,695 Plus: Debt – – 7 1,484 538 1,284 – Plus: Minority Interest & Preferred Stock – – – 4 2 6,843 2 Less: Cash (221) (221) (222) (254) (34) (1,539) (816) Less: Investments – – – (36) (6) (314) (22) Adj. Firm Value Mgmt Street $190 $327 $266 $1,619 $575 $17,040 $7,860 2019A $73 $73 2.6x 4.5x 3.6x 3.5x 3.4x 15.1x 31.6x LTM 64 64 3.0 5.2 4.2 5.1 4.5 16.1 31.5 2020E 67 66 2.8 4.9 4.0 4.9 4.5 16.4 33.1 2021E 107 70 1.8 3.1 3.8 4.6 NA 14.8 26.1 2023E (Blended) 92 NA 2.1 3.6 NA NA NA NA NA Adj. Firm Value w Pension Obligation $207 $344 $285 $1,736 $650 $17,234 $8,110 2019A $75 $75 2.8x 4.6x 3.8x 3.7x 3.9x 15.3x 30.4x LTM 65 65 3.2 5.3 4.4 5.2 5.1 16.2 30.3 2020E 69 68 3.0 5.0 4.2 5.1 5.1 16.6 31.7 2021E 109 72 1.9 3.2 4.0 4.8 NA 15.0 25.5 2023E (Blended) 94 NA 2.2 3.7 NA NA NA NA NA '19A - '21E Revenue CAGR (14.2%) (14.2%) (17.5%) (13.3%) NA (8.2%) 3.2% '19A - '21E EBITDA CAGR 20.2% 20.2% (2.4%) (12.4%) NA (7.7%) 10.0% '19A EBITDA Margin (post-SBC) 7.8% 7.8% 7.8% 10.9% 19.5% 11.8% 13.7% '20E EBITDA Margin (post-SBC) 9.0% 9.0% 8.9% 9.7% 15.8% 11.8% 13.4% '21E EBITDA Margin (post-SBC) 15.4% 15.4% 10.9% 11.1% NA 13.4% 15.6% Dividend Yield – – – – – 1.1% 0.5% % Digital Revenue (LTM) 19.1% 19.1% 19.1% 18.4% 26.6% NA 44.0% TEAL TEAL Selected Public Comparables (As of 12/30/20) ($ in millions, except per share values) A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Public Comparables – News Media 4 3 5 2 1 5 5 6 5 5 5 5 5 Source: Company filings, FactSet and Wall Street research. Note: Market values as of December 30, 2020. EBITDA shown on a Post - SBC basis. 1 Balance Sheet as of Q4 2020 per Teal Management. Figures are pro forma for the sale of BestReviews . 2 Balance sheet based on Q3 2020 public filings. Teal Street EBITDA numbers are based on broker projections. Figures are pro fo rma for the sale of BestReviews . 3 Pro forma for the repayment of $647mm of term loan debt using $497mm in proceeds from newly issued convertible notes, $135mm of real estate sales and $15mm of cash announced on December 17, 2020. Digital revenue percentage computed on a pro forma basis for merger with New Media. 4 EBITDA includes 50% of TNI / MNI EBITDA (which is not consolidated for GAAP). 5 Pension expense of $2mm added back to EBITDA and $17mm pension obligation added to Adj. Firm Value (for Teal). 6 News Corp does not fully disclose digital revenues. 5 14
Teal (Street) Teal (Street) Comparables Benchmarking – Teal @ $15.95 / Share (As of 2/12/21) FV / 2019A EBITDA (w/ Pensions) A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Source: Teal Management, Company filings, FactSet and Wall Street research. Note: Market values as of February 12, 2021. 1 Pro forma for sale of BestReviews . Teal Management balance sheet as of Q4 2020. Teal Street balance sheet as of Q3 2020. 2 Current Net Debt / 2020E EBITDA (EBITDA is Pre - SBC and the ratio is not adjusted for pensions). 3 Not shown due to lack of 2021E estimates. FV / 2020E EBITDA (w/ Pensions) 5.7x 5.0x 6.1x 5.5x 18.6x 28.2x FV / 2021E EBITDA (w/ Pensions) Teal ( Mgmt ) 3.6x 4.1x 5.7x NA 16.0x 26.0x 3 13.7% 11.8% 19.5% 7.8% 10.9% 14.1% 12.6% 15.8% 10.2% 9.7% 14.0% 14.6% NA 14.5% 11.1% — — 3.8x — 3.5x ’20E Net Leverage 5.3x 4.4x 4.1x 18.5x 28.4x FV / LTM EBITDA (w/ Pensions) 6.1x 6.2x 5.0x 17.4x 28.2x ’19A Margin ’20E Margin 9.0% ’21E Margin 15.4% Teal ( Mgmt ) 1 1 1 46.4% NA 26.8% 19.1% 18.4% % LTM Digital Revenue Teal 1 Teal Teal margins jump to the high - end of the comparable range in all cases 1 1 — 2 15
Low High (Street) Price per Share $10.93 $14.59 $15.95 $5.26 $2.26 $23.72 $48.91 % 52 Week High 68.5% 91.5% 100.0% 81.6% 99.1% 100.0% 87.1% Equity Value $411 $549 $600 $763 $137 $14,155 $8,243 Plus: Debt – – 7 1,484 524 1,256 – Plus: Minority Interest & Preferred Stock – – – 4 2 7,244 2 Less: Cash (221) (221) (218) (254) (37) (1,562) (898) Less: Investments – – – (36) (6) (353) (22) Adj. Firm Value Mgmt Street $190 $327 $389 $1,961 $619 $20,739 $7,326 2019A $73 $73 2.6x 4.5x 5.3x 4.3x 3.7x 18.4x 29.5x LTM 64 64 3.0 5.2 6.1 6.2 4.5 17.3 29.2 2020E 67 80 2.8 4.9 4.9 6.0 4.9 18.5 29.2 2021E 107 98 1.8 3.1 4.0 5.6 NA 15.9 26.8 2023E (Blended) 92 NA 2.1 3.6 NA NA NA NA NA Adj. Firm Value w Pension Obligation $207 $344 $408 $2,078 $693 $20,933 $7,576 2019A $75 $75 2.8x 4.6x 5.4x 4.4x 4.1x 18.5x 28.4x LTM 65 65 3.2 5.3 6.3 6.2 5.0 17.4 28.2 2020E 69 82 3.0 5.0 5.0 6.1 5.5 18.6 28.2 2021E 109 100 1.9 3.2 4.1 5.7 NA 16.0 26.0 2023E (Blended) 94 NA 2.2 3.7 NA NA NA NA NA '19A - '21E Revenue CAGR (14.2%) (14.2%) (15.2%) (13.3%) NA (3.3%) 3.8% '19A - '21E EBITDA CAGR 20.2% 20.2% 15.6% (12.4%) NA 7.5% 5.0% '19A EBITDA Margin (post-SBC) 7.8% 7.8% 7.8% 10.9% 19.5% 11.8% 13.7% '20E EBITDA Margin (post-SBC) 9.0% 9.0% 10.2% 9.7% 15.8% 12.6% 14.1% '21E EBITDA Margin (post-SBC) 15.4% 15.4% 14.5% 11.1% NA 14.6% 14.0% Dividend Yield – – – – – 0.8% 0.6% % Digital Revenue (LTM) 19.1% 19.1% 19.1% 18.4% 26.8% NA 46.4% TEAL TEAL Selected Public Comparables (As of 2/12/21) ($ in millions, except per share values) A APPENDIX – PUBLIC COMPARABLES PROJECT ALINEA Public Comparables – News Media 4 3 5 2 Source: Company filings, FactSet and Wall Street research. Note: Market values as of February 12, 2021. EBITDA shown on a Post - SBC basis. The New York Times, News Corporation and Lee figu res have been updated to include any relevant calendar Q4 2020 information contained in their latest financial releases and reports (per 8 - Ks / 10 - Qs released through Februar y 12, 2021). 1 Balance Sheet as of Q4 2020 per Teal Management. Figures are pro forma for the sale of BestReviews . 2 Balance sheet based on Q3 2020 public filings. Teal Street EBITDA numbers are based on broker projections. Figures are pro fo rma for the sale of BestReviews . 3 Pro forma for the repayment of $647mm of term loan debt using $497mm in proceeds from newly issued convertible notes, $135mm of real estate sales and $15mm of cash announced on December 17, 2020. Digital revenue percentage computed on a pro forma basis for merger with New Media. 4 EBITDA includes 50% of TNI / MNI EBITDA (which is not consolidated for GAAP). 5 Pension expense of $2mm added back to EBITDA and $17mm pension obligation added to Adj. Firm Value (for Teal). 6 News Corp does not fully disclose digital revenues. 1 5 5 6 5 5 5 5 5 5 16
CONFIDENTIAL B Appendix – Precedent Transactions PROJECT ALINEA
11.4x 35.2x 8.5x 6.3x 5.0x 4.7x 3.5x 5.6x 4.6x 4.3x NA 5.5x 7.0x 4.0x 5.0x 4.0x 4.8x 4.4x 3.6x 3.4x 0.4x 2.5x 1.2x NA 0.6x 0.4x 0.2x 1.2x 1.1x 0.7x NA 0.6x NA NA 0.5x NA 0.6x 0.4x 0.4x 0.5x 2.0 4.0 6.0 8.0 10.0 12.0x LTM EBITDA Multiple LTM Revenue Multiple 3.5x Precedent Newspaper Publishing Transaction Multiples ($ in millions) PROJECT ALINEA Newspaper Publishing Transaction Multiples Source: Company filings, FactSet and Wall Street Research. Note: Precedent transactions exclude deals where financial terms were not disclosed. 1 EBITDA multiple is affected by Washington Post Co. agreeing to fund the pension obligations of retirees and pay Bezos a sum e q ual to the current staff’s projected benefits plus $50mm. 2 Multiple based on Adjusted Operating Profit. 3 Includes assumption of $90mm in pension obligations. 4 Represents EV/NTM multiple, not including $10mm of immediately available synergies (4.7x with immediately available synergies ) a t time of announcement and 3.3x using full run - rate synergies. 5 Multiples reflect last public offer price of $15.00 per share. 6 Multiples reflect last rumored offer price of $18.75 per share. 7 Multiple reflects pensions of $293mm. 8 Implied Firm Value based on $13.00 per share and net debt of ($88mm) as of Q3 2019. Multiples calculated using TPCO LTM figur es as of Q3 2019. 9 EBITDA multiple reflects a deduction of $8mm in lease payments to Berkshire Hathaway. 10 2020E revenue and EBITDA per management filing utilized as proxy for LTM figures. 1 4 2 Ann. Date Aug ’13 Jul ’15 Feb ’18 Dec ’11 Dec ’11 May ’12 Aug ’13 Jul ’14 Nov ’14 Feb ’15 May ’15 Oct ’15 Dec ’15 Nov ’16 Cancelled Aug ’17 Aug ’19 Nov ’19 Jan ’20 Jul ’20 Firm Value $250 $1,310 $590 $200 $140 $142 $70 $529 $280 $102 $114 $280 $140 $20 $869 / $1,012 $120 $1,571 $442 $140 $312 Target Las Vegas Review Harris Acquiror Jeff Bezos Patrick Soon - Shiong John Henry News & Media Capital Chatham Asset Mgmt (63 Newspapers) B APPENDIX – PRECEDENT TRANSACTIONS 5.8x 6 5 0.6x 6 5 3 & 8 Median: 0.6x Median: 4.7x (Michael Ferro 25% stake) 5.5x 9 5.5x 7 7 = High / Low Reference Range 4 10 0.0 17
Recent Newspaper Transactions ($ in millions, except per share values) B APPENDIX – PRECEDENT TRANSACTIONS New Media / Gannett Source: Teal Management, Company filings, press releases and FactSet. Note: EBITDA represents post - SBC EBITDA. 1 Represents $6.25 per share in cash plus 0.5427 New Media shares ($10.71 / share trading value based on the closing price as o f A ugust 2, 2019). 2 Limited financial information available on Berkshire Hathaway Media Group’s newspaper publications (no pension data was discl ose d). PROJECT ALINEA Lee Enterprises / Berkshire Hathaway Media Group 2 Gannett Standalone Financials 2017A 2018A 2019E Revenue $3,189 $2,944 $2,699 % Growth (10.1%) (7.7%) (8.4%) EBITDA $372 $330 $286 % Growth (6.3%) (11.4%) (13.4%) % Margin 11.7% 11.2% 10.6% Digital Revenue $744 $781 $767 % Total Revenue 23.3% 26.5% 28.4% Offer Price¹ $12.06 (x) FDSO 116.8 Fully Diluted Equity $1,408 (-) Options Proceeds (1) Equity Value $1,408 Plus: Debt $369 Plus: Minority Interest – Less: Investments (92) Less: Cash (113) Adj. Firm Value $1,571 LTM EBITDA 329 FV / LTM EBITDA 4.8x Plus: Pensions $293 Adj. Firm Value w Pension Obligation $1,864 LTM Adj. EBITDA ($9mm pension expense) 337 FV / LTM Adj. EBITDA 5.5x Versus - 10.8%, - 10.7% and - 8.4% for Teal in 2017, 2018 and 2019, respectively Versus 8% for Teal in 2019 Versus 18% for Teal in 2019 Transaction Value (excl. Real Estate) $140 LTM EBITDA $39 FV / LTM EBITDA 3.6x Memo: LTM EBITDA Pre-Lease Agreement $47 (-) Lease Payments to Berkshire (8) Implied LTM EBITDA $39 Chatham Asset Management / McClatchy Transaction Value $312 '20E EBITDA $92 FV / '20E EBITDA 3.4x Memo: Credit Bid of First Lien Notes $263 Cash 49 Transaction Value $312 18
Precedent Processes: Acquisitions by Minority Shareholders B APPENDIX – PRECEDENT TRANSACTIONS PROJECT ALINEA We reviewed 8 precedents from the last 10 years (minority shareholders acquire control) 1 Did not consider GP / LP transactions ( Archrock , Encore Energy and Northern Tier), a two - step planned acquisition ( GrafTech ) or NASCAR / International Speedway (under common control of the France Family) Leaves three transactions: Coty, HSN and Dole JAB made a tender offer to increase its stake from 40% to 60% of Coty at a 25% premium to the price a day prior to the offer (51 % premium to the 30 - day VWAP per the SEC filings); HSN and Dole were acquisitions of all the public shares Dole HSN Merger Announcement Date 8/11/13 7/6/17 First Proposal To Merger Signing ~ 2 Months ~ 1.5 months Public Initial Offer Yes No Form of Consideration Cash Stock Initial Bid Ask Spread $12 – $14 / share (17% gap) 1.735x – 1.79x ratio (3% gap); 1.60x – 1.70x (6% gap post diligence) Buyer Price Bumps 4 1 Final Price $13.50 / share 1.65x Total Move (Initial to Final) 12.5% 3.1% Premium to Undisturbed 32% 29% Go Shop Yes 2 No Source: Company Filings. 1 $500mm – $2bn of firm value. 2 Other parties expressed interest at $13 – $14 / share prior to signing (but the go - shop expired with no definitive offers). 19
Precedent Premiums Paid By Minority Shareholders Over The Last 10 Years: ( i ) FV $500mm - $2.0bn and (ii) Acquiror Ownership of Target Between 15% - 50% ($ in millions, except per share values) B APPENDIX – PRECEDENT TRANSACTIONS PROJECT ALINEA Source: Thomson SDC, company filings and publicly available news sources. Note: Transactions announced between January 1, 2010 and February 12, 2021. Removed Brookfield / GrafTech since it was a two - step tender / merger acquisition. 1 Based on undisturbed price prior to initial public offer. 2 Originally 1.735x (Initial Offer) and 1.75x (Final Offer) but ratio declined due to diligence issues. 3 $28.34 in cash and stock (also offered $26.06 in cash). Transactions with Existing Acquiror Ownership 3 1 1 Implied Prem. to Undist. First Initial Offer Undisturbed Final Firm Acq. % Target Ownership Initial Offer Premium Final Offer Premium Memo: Offer Public Date Agreement Comment Acquiror Target Value Pre Post Consideration1-Day Prior 4-Wk Prior 1-Day Prior 4-Wk Prior Initial OfferFinal Offer# of Bumps % Bump 02/12/19 Y 02/11/19 03/17/19 Tender JAB Cosmetics Coty $1,748 40.1% 60.0% Cash 24.9% 67.6% 24.9% 67.6% $11.65 $11.65 – – 11/09/18 Y 11/09/18 05/22/19 Common Control NASCAR Holdings International Speedway 1,167 39.5% 100.0% Cash 7.5% (0.6%) 15.2% 6.5% $42.00 $45.00 5 7.1% 11/29/17 N 12/31/17 01/02/18 GP / LP Archrock Archrock Partners 1,959 41.3% 100.0% Stock 16.4% 22.4% 23.4% 29.9% 1.32x 1.40x 2 6.1% 05/10/17 N 07/05/17 07/06/17 Merger Liberty Interactive HSN 1,757 38.2% 100.0% Stock 25.0% 11.5% 28.9% 15.0% 1.60x 1.65x 1 3.1% 10/26/15 Y 10/23/15 12/21/15 GP / LP Western Refining Northern Tier Energy 1,737 38.4% 100.0% Cash / Stock 14.8% 12.4% 17.8% 15.3% $27.62 $28.34 1 2.6% 06/10/13 Y 06/10/13 08/11/13 Merger w/ Go- Shop Investor Group Dole Food Co 1,018 37.6% 100.0% Cash 17.6% 12.0% 32.4% 26.1% $12.00 $13.50 4 12.5% 03/25/11 Y 03/24/11 07/10/11 GP / LP Vanguard Natural Resources Encore Energy Partners 764 46.0% 100.0% Stock (0.8%) 1.1% 3.3% 5.3% 0.72x 0.75x 1 4.2% Median: $1,737 39.5% 100.0% 16.4% 12.0% 23.4% 15.3% Mean: 1,450 40.2% 94.3% 15.1% 18.1% 20.8% 23.7% 2 2 20
CONFIDENTIAL C Appendix – Business Plan PROJECT ALINEA
Business Plan Overview C APPENDIX – BUSINESS PLAN PROJECT ALINEA 2021 Board approved budget: $695mm of revenue and $111mm of EBITDA before stock - based compensation (“SBC”) expense $107mm of EBITDA after SBC versus $67mm in 2020 (margins rise to 15.4% versus 9.0% in 2020) Teal Q3 ’20 margin of 12.3% pro forma for the sale of BestReviews and after deducting SBC expense Historical and forecasted results exclude the financial impact of BestReviews Case A Case B 2022 and 2023 forecasts prepared at the request of the Special Committee (has not been reviewed by the Teal board) 2022 and 2023 revenues equal those used in Case B Margins decline to 13% in 2022 and 11% in 2023 – consistent with Gannett levels in 2019 and 2021 Teal % digital revenues (LTM), ’19A - ’21E revenue CAGR, EBITDA margins (2020) and capex / revenue ratio (2020) are consistent with Gannett’s comparable statistics (see page 30) 2022 and 2023 forecasts prepared by Teal Management (has not been reviewed by the Teal board) 2023 revenues are 4% below those in Case A (2022 revenues are slightly below Case A) Margins decline to 14% by 2023 Case C 2022 and 2023 forecasts prepared by Teal Management (has not been reviewed by the Teal board) Revenues continue to decline and margins rise to 18% by 2023 Blended Case Composite view incorporating 25% of Case A and 75% of Case B for each line item in 2022 and 2023 Prepared at the request of the Special Committee (has not been reviewed by the Teal board) 2023 revenue declines at 6.8% (same as 2021 revenue declines); EBITDA margins reach 15.3% (versus 15.4% in 2021) 21
$143 $167 $167 $147 $169 $200 $230 $196 $220 $196 $220 $197 $222 1,013 865 779 599 526 453 392 449 377 449 377 450 $381 $1,156 $1,032 $946 $746 $695 $653 $622 $645 $597 $645 $597 $647 $603 - 200 400 600 800 1,000 1,200 $1,400 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Digital Print Business Plan – Revenue & EBITDA ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Revenue Commentary ’21E - ’23E Print declines of 14% - 15% (CAGR) which are worse than ’17A - ’19A levels but better than ’19A - ’21E levels (23% decline in 2020) Digital growth driven by: ( i ) a recovery in digital advertising (recover to ’19A levels by ’22E / ’23E), and (ii) growth in digital circulation (subscriber and ARPU growth) Case A Case B Margins rise from 10% to 15% in ’21E (versus 11% for Gannett) Case A has margins rise to 18% in ’23E Case B has margins decline to 14% in ’23E (News Corp and NY Times level) Case C has margins decline to 11% in ’23E (Gannett levels) Blended Case margins hold at 15% (comparable to 2021) EBITDA (Post - SBC) $82 $80 $73 $67 $107 $110 $113 $102 $85 $84 $66 $104 $92 - 50 100 150 $200 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Post - SBC EBITDA Margin 7.8% 7.1% 7.7% 9.0% 15.4% 16.9% 18.1% 15.8% 14.3% Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 1 1 1 1 Case C 13.0% 11.0% $952 $1,074 $873 $679 $589 $543 $509 $543 $512 $557 $527 Operating Expenses FTE 3,821 2,863 2,479 2,217 2,106 2,300 2,191 – – NA NA (12.3%) (17.8%) (13.7%) (15.4%) (15.4%) 2 - Year Trailing Print CAGR Budget Blended Case A Case B Case C Budget Blended $543 $511 16.1% – 15.3% – (14.9%) 22
Unlevered Free Cash Flow ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Selected Free Cash Flow Items Budget Case A Case B Case C Blended 2017A 1 2018A 1 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Revenue $1,156 $1,032 $946 $746 $695 $653 $622 $645 $597 $645 $597 $647 $603 % Growth (10.7%) (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) (7.3%) (7.5%) (7.3%) (7.5%) (7.0%) (6.8%) EBITDA (Post-SBC) $82 $80 $73 $67 $107 $110 $113 $102 $85 $84 $66 $104 $92 % Margin 7.1% 7.8% 7.7% 9.0% 15.4% 16.9% 18.1% 15.8% 14.3% 13.0% 11.0% 16.1% 15.3% Capex ($24) ($33) ($22) ($10) ($6) ($6) ($6) ($6) ($6) ($6) ($6) ($6) ($6) % Revenue (2.1%) (3.2%) (2.3%) (1.3%) (0.9%) (0.9%) (1.0%) (0.9%) (1.0%) (0.9%) (1.0%) (0.9%) (1.0%) Adjusted Expenses2 ($34) ($75) ($36) ($24) ($40) ($12) ($13) ($12) ($13) ($12) ($13) ($12) ($13) Taxes @ 28% $0 $13 ($5) ($12) ($19) ($27) ($27) ($24) ($19) ($19) ($13) ($25) ($21) Unlevered Free Cash Flow3 $21 ($8) $25 $28 $49 $69 $71 $64 $53 $51 $38 $65 $57 % Revenue 1.8% (0.7%) 2.6% 3.7% 7.0% 10.6% 11.4% 10.0% 8.8% 7.9% 6.5% 10.1% 9.5% Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Extraordinary charges related to items such as restructuring charges. 3 See page 31 for comprehensive unlevered free cash flow calculation. 23
Cases A, B, C and Blended Versus Projections Prepared In February 2020 ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Revenue Capex EBITDA (Post - SBC) Unlevered Free Cash Flow $1,032 $946 $695 $653 $622 $645 $597 $859 $806 $762 $724 $780 $677 $1,156 $746 $647 $603 500 600 700 800 900 1,000 1,100 $1,200 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 $110 $113 $67 $102 $85 $82 $80 $73 $84 $66 $83 $75 $69 $64 $88 $105 $107 $104 $92 50 60 70 80 90 100 110 $120 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 $69 $71 $28 $64 $53 $21 ($8) $25 $49 $51 $38 $42 $36 $38 $37 ($8) $65 $57 -20 - 20 40 60 80 $100 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Source: Teal Management and Wall Street research. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 1 Noble broker estimates are pro forma for BestReviews . (20) $6 $10 $6 $24 $33 $22 $6 $13 $14 $8 - 10 20 30 $40 Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Cases A, B, C, and Blended are equal Cases B and C are equal 2017 – 2019 Actual + 2020 Management Estimate + 2021 Budget February Case C Case B Case A Noble 1 Blended 24
’21E - ’23E Print declines consistent with ’17A - ’19A experience (declined 38% in 2020) Digital advertising in 2019 was hurt by: ( i ) Daily News shift to digital subscriptions, and (ii) Cars.com contract unwind Declined 23% in 2020 and recovers to 2019 levels by 2022 / 2023 Print circulation declined 8.6% in 2020 with similar declines forecasted for ’21E - ’23E (above the ’17A - ’19A levels) Digital circulation is forecasted to double between 2020 and 2023 based on subscriber growth and better churn management, despite less price discounting Traditional Other Revenue (direct mail and print / distribution for peers) declined 25% in 2020 (mid - teens percentage annual declines from ’20E - ’23E) Digital Other (content agency) revenue is held flat from ’20E - ’23E Margins rise from 9.0% in 2020 to 15.4% in 2021 (Q3’20A margins were 12.3% post - SBC) Margins rise to 18.1% by 2023 (margin expansion driven primarily by distribution outsourcing and the reduction in occupancy expense) Teal Financial Projections – Case A ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Summary of Teal Projections – Case A Case A Observations Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $121 $95 (20.5%) (22.2%) Digital Advertising 97 101 87 67 73 83 93 (5.3%) 12.7% Total Advertising $591 $472 $399 $261 $231 $204 $189 (17.8%) (9.6%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (11.8%) (7.4%) Print Circulation 363 357 337 308 286 263 239 (3.7%) (8.5%) Avg. Subs (000s) 895 792 677 592 515 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.93 Digital Circulation 10 18 29 46 66 86 103 73.7% 25.3% Avg. Subs (000s) 290 384 469 526 579 ARPU (Weekly) $1.92 $2.28 $2.70 $3.13 $3.42 Total Circulation $373 $375 $366 $353 $352 $348 $343 (0.9%) (1.3%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.0%) (1.6%) Traditional Other Revenue 156 137 130 97 83 69 57 (9.0%) (17.0%) Digital Other Revenue 36 49 51 34 30 32 34 18.9% 6.0% Total Other Revenue $192 $186 $181 $132 $113 $101 $91 (3.1%) (10.3%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (10.2%) (10.3%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $653 $622 (9.6%) (5.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) Compensation 435 396 338 265 230 214 206 (11.8%) (5.3%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.5%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 29 6.2% (11.1%) Other Expenses2 129 61 98 73 62 59 57 (13.0%) (4.3%) Total Operating Expenses $1,065 $942 $859 $674 $584 $539 $505 (10.1%) (7.0%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $114 $117 (2.9%) 2.6% YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% 3.1% 2.1% Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 17.5% 18.8% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $110 $113 (5.7%) 2.7% YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% 3.2% 2.2% Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 16.9% 18.1% 25
No changes to 2021 budget Case B revenues are $8mm lower in 2022 (versus Case A) and $26mm lower in 2023 (versus Case A) Roughly half of the revenue reductions come from Advertising with the other half split roughly evenly between Circulation and Other 2023 reductions in Advertising mostly in print (75%) 2023 reductions in Circulation and Other split roughly evenly between Print and Digital Margins decline from 15.4% in 2021 to 14.3% in 2023 (News Corp and New York Times levels) Teal Financial Projections – Case B ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Summary of Teal Projections – Case B Case B Observations Source: Teal Management. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $118 $86 (20.5%) (26.2%) Digital Advertising 97 101 87 67 73 82 91 (5.3%) 11.2% Total Advertising $591 $472 $399 $261 $231 $200 $177 (17.8%) (12.6%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (13.4%) (11.7%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (9.0%) Avg. Subs (000s) 895 792 677 592 512 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.88 Digital Circulation 10 18 29 46 66 84 99 73.7% 22.8% Avg. Subs (000s) 290 384 469 526 576 ARPU (Weekly) $1.92 $2.28 $2.70 $3.07 $3.30 Total Circulation $373 $375 $366 $353 $352 $347 $336 (0.9%) (2.3%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.4%) (3.1%) Traditional Other Revenue 156 137 130 97 83 69 54 (9.0%) (18.9%) Digital Other Revenue 36 49 51 34 30 30 30 18.9% (0.7%) Total Other Revenue $192 $186 $181 $132 $113 $98 $84 (3.1%) (13.7%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.9%) (14.5%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $645 $597 (9.6%) (7.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (7.3%) (7.5%) Compensation 435 396 338 265 230 214 207 (11.8%) (5.1%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.8%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 30 6.2% (10.1%) Other Expenses2 129 61 98 73 62 59 57 (13.0%) (3.9%) Total Operating Expenses $1,065 $942 $859 $674 $584 $539 $507 (10.1%) (6.8%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $106 $89 (2.9%) (10.3%) YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% (4.4%) (15.9%) Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 16.5% 15.0% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $102 $85 (5.7%) (10.8%) YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% (4.5%) (16.6%) Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 15.8% 14.3% 26
No changes to 2021 budget Incorporates Case B revenues Target Gannett margins (~11% in 2019 and 2021) by 2023 Current operating similarities highlighted on the left side of page 30 This Case was prepared at the request of the Special Committee Teal Financial Projections – Case C ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Summary of Teal Projections – Case C Case C Observations Source: Prepared at the request of the Special Committee. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $118 $86 (20.5%) (26.2%) Digital Advertising 97 101 87 67 73 82 91 (5.3%) 11.2% Total Advertising $591 $472 $399 $261 $231 $200 $177 (17.8%) (12.6%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (13.4%) (11.7%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (9.0%) Avg. Subs (000s) 895 792 677 592 512 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.88 Digital Circulation 10 18 29 46 66 84 99 73.7% 22.8% Avg. Subs (000s) 290 384 469 526 576 ARPU (Weekly) $1.92 $2.28 $2.70 $3.07 $3.30 Total Circulation $373 $375 $366 $353 $352 $347 $336 (0.9%) (2.3%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.4%) (3.1%) Traditional Other Revenue 156 137 130 97 83 69 54 (9.0%) (18.9%) Digital Other Revenue 36 49 51 34 30 30 30 18.9% (0.7%) Total Other Revenue $192 $186 $181 $132 $113 $98 $84 (3.1%) (13.7%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.9%) (14.5%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $645 $597 (9.6%) (7.4%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (7.3%) (7.5%) Compensation 435 396 338 265 230 (11.8%) Circulation Distribution 203 178 171 148 131 (8.1%) Newsprint & Ink 69 68 57 34 27 (9.0%) Outside Services / Printing 174 179 134 103 98 (12.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 6.2% Other Expenses2 129 61 98 73 62 (13.0%) Total Operating Expenses $1,065 $942 $859 $674 $584 $557 $527 (10.1%) (5.1%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $88 $70 (2.9%) (20.8%) YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% (20.8%) (20.7%) Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 13.6% 11.7% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $84 $66 (5.7%) (21.7%) YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% (21.6%) (21.7%) Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 13.0% 11.0% 27
No changes to 2021 budget Composite view incorporating 25% of Case A and 75% of Case B for each line item in 2022 and 2023 2023 revenue declines at 6.8% (same as 2021 revenue declines) EBITDA margins reach 15.3% (versus 15.4% in 2021) This Case was prepared at the request of the Special Committee Teal Financial Projections – Blended Case (25% A + 75% B) ($ in millions, except ARPU data) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Summary of Teal Projections – Blended Case Blended Case Observations Source: Prepared at the request of the Special Committee. Note: Financials exclude the LA Times (sold in February 2018) and BestReviews (sold in December 2020). 1 2017 and 2018 normalized for the acquisitions of the Virginian - Pilot and the NY Daily News. 2 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. Budget $ in millions 2017PF 1 2018PF 1 2019A 2020E 2021E 2022E 2023E '17A - '19A '21E - '23E Print Advertising $494 $371 $312 $194 $157 $118 $88 (20.5%) (25.2%) Digital Advertising 97 101 87 67 73 83 91 (5.3%) 11.6% Total Advertising $591 $472 $399 $261 $231 $201 $180 (17.8%) (11.8%) YoY Growth NA (20.1%) (15.4%) (34.6%) (11.6%) (13.0%) (10.6%) Print Circulation 363 357 337 308 286 263 237 (3.7%) (8.9%) Avg. Subs (000s) 895 792 677 592 513 ARPU (Weekly) $7.24 $7.47 $8.12 $8.52 $8.89 Digital Circulation 10 18 29 46 66 85 100 73.7% 23.4% Avg. Subs (000s) 290 384 469 526 577 ARPU (Weekly) $1.92 $2.28 $2.70 $3.09 $3.33 Total Circulation $373 $375 $366 $353 $352 $347 $338 (0.9%) (2.0%) YoY Growth NA 0.6% (2.4%) (3.4%) (0.5%) (1.3%) (2.7%) Traditional Other Revenue 156 137 130 97 83 69 55 (9.0%) (18.4%) Digital Other Revenue 36 49 51 34 30 30 31 18.9% 1.0% Total Other Revenue $192 $186 $181 $132 $113 $99 $86 (3.1%) (12.8%) YoY Growth NA (3.5%) (2.7%) (27.0%) (14.4%) (12.2%) (13.4%) Total Operating Revenue $1,156 $1,032 $946 $746 $695 $647 $603 (9.6%) (6.9%) YoY Growth (10.8%) (10.7%) (8.4%) (21.1%) (6.8%) (7.0%) (6.8%) Compensation 435 396 338 265 230 214 207 (11.8%) (5.1%) Circulation Distribution 203 178 171 148 131 115 103 (8.1%) (11.0%) Newsprint & Ink 69 68 57 34 27 26 24 (9.0%) (6.7%) Outside Services / Printing 174 179 134 103 98 91 86 (12.3%) (6.3%) Occupancy, Insurance / Office Exp. 55 59 62 51 37 34 30 6.2% (10.3%) Other Expenses2 129 61 98 73 62 59 57 (13.0%) (4.0%) Total Operating Expenses $1,065 $942 $859 $674 $584 $539 $507 (10.1%) (6.9%) Adjusted EBITDA (Pre-SBC) $92 $91 $86 $72 $111 $108 $96 (2.9%) (6.9%) YoY Growth 3.4% (0.8%) (4.9%) (16.2%) 53.4% (2.5%) (11.2%) Margin % 7.9% 8.8% 9.1% 9.7% 16.0% 16.7% 15.9% Stock-Based Compensation 9 10 13 5 4 4 4 19.2% 0.0% Adjusted EBITDA (Post-SBC) $82 $80 $73 $67 $107 $104 $92 (5.7%) (7.2%) YoY Growth 1.6% (2.3%) (9.0%) (8.2%) 59.1% (2.6%) (11.6%) Margin % 7.1% 7.8% 7.7% 9.0% 15.4% 16.1% 15.3% 28
Differences Between Cases – Cases B, C and Blended Relative to Case A ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Gap in Revenue Analysis Gap in Revenue 2021E Versus 2020E 2022E Gap 2023E Gap $ in millions 2021E 2020E Gap Case A Case B Case C Blended A to B A to C A to Blend Case A Case B Case C Blended A to B A to C A to Blend Print Advertising $157 $194 ($37) $121 $118 $118 $118 ($3) ($3) ($2) $95 $86 $86 $88 ($9) ($9) ($7) Digital Advertising 73 67 6 83 82 82 83 (0) (0) (0) 93 91 91 91 (3) (3) (2) Total Advertising $231 $261 ($30) $204 $200 $200 $201 ($4) ($4) ($3) $189 $177 $177 $180 ($12) ($12) ($9) Print Circulation 286 308 (22) 263 263 263 263 – – – 239 237 237 237 (3) (3) (2) Digital Circulation 66 46 20 86 84 84 85 (2) (2) (1) 103 99 99 100 (4) (4) (3) Total Circulation $352 $353 ($2) $348 $347 $347 $347 ($2) ($2) ($1) $343 $336 $336 $338 ($7) ($7) ($5) Traditional Other Revenue 83 97 (15) 69 69 69 69 (1) (1) (1) 57 54 54 55 (3) (3) (2) Digital Other Revenue 30 34 (4) 32 30 30 30 (2) (2) (2) 34 30 30 31 (4) (4) (3) Total Other Revenue $113 $132 ($19) $101 $98 $98 $99 ($3) ($3) ($2) $91 $84 $84 $86 ($7) ($7) ($5) Total Operating Revenue $695 $746 ($51) $653 $645 $645 $647 ($8) ($8) ($6) $622 $597 $597 $603 ($26) ($26) ($19) Operating Expenses Operating Expenses as a Percentage of Revenue 2021E Versus 2020E 2022E Gap 2023E Gap $ in millions 2021E 2020E Gap Case A Case B Case C Blended A to B A to C A to Blend Case A Case B Case C Blended A to B A to C A to Blend Compensation 33.0% 35.6% (2.5%) 32.8% 33.2% 33.1% 0.4% (0.3%) 33.1% 34.7% 34.3% 1.6% 1.2% Circulation Distribution 18.8% 19.8% (1.0%) 17.6% 17.8% 17.8% 0.2% (0.2%) 16.6% 17.3% 17.1% 0.7% 0.5% Newsprint & Ink 3.9% 4.5% (0.6%) 3.9% 4.0% 4.0% 0.1% (0.0%) 3.8% 4.0% 3.9% 0.1% 0.1% Outside Services / Printing 14.1% 13.8% 0.3% 14.0% 14.2% 14.1% 0.2% (0.1%) 13.8% 14.4% 14.3% 0.6% 0.4% Occupancy, Insurance / Office Exp. 5.3% 6.8% (1.4%) 5.2% 5.3% 5.2% 0.1% (0.0%) 4.7% 5.0% 4.9% 0.3% 0.2% Other Expenses1 8.9% 9.8% (0.9%) 9.0% 9.1% 9.1% 0.1% (0.1%) 9.1% 9.6% 9.5% 0.5% 0.3% Stock-Based Compensation 0.6% 0.7% (0.1%) 0.6% 0.6% 0.6% 0.0% (0.0%) 0.7% 0.7% 0.7% 0.0% 0.0% Total Operating Expenses 84.6% 91.0% (6.4%) 83.1% 84.2% 87.0% 83.9% 1.1% 3.9% (0.8%) 81.9% 85.7% 89.0% 84.7% 3.9% 7.1% 2.9% EBITDA (Post-SBC) $107 $67 $40 $110 $102 $84 $104 ($8) ($27) ($6) $113 $85 $66 $92 ($28) ($47) ($21) Margin % 15.4% 9.0% 16.9% 15.8% 13.0% 16.1% 18.1% 14.3% 11.0% 15.3% Source: Teal Management. 1 Other Expenses include: Digital COGS / Royalties, Supplies / R&M, Employee Expenses, Misc. Expenses and Allocations. 29
Operations In Perspective – Similar to Gannett C APPENDIX – BUSINESS PLAN PROJECT ALINEA % Digital LTM Revenue Days Receivable as of September 30 th , 2020 2 Source: Teal Management, Company filings, FactSet and Wall Street Research. 1 Pro forma for sale of BestReviews . 2 Based on a 365 day year and LTM revenue. 3 Includes A/P, accrued expenses, comp and benefits, as well as deferred revenue (excludes the current portion of debt and leas es and other current liabilities). 4 News Corp does not fully disclose the details of its digital revenues. 2020E EBITDA (Post - SBC) Margin 2019A EBITDA (Post - SBC) Margin 34.9 29.4 23.9 51.5 25.7 1 Teal 7.8% 10.9% 19.5% 11.8% 13.7% 1 Teal 19.1% 37.0% 36.8% 36.8% 36.9% 18.4% 26.8% 46.4% Teal 1 9.0% 18.1% 14.3% 11.0% 15.3% 9.7% 15.8% 12.6% 14.1% 2.5% 5.3% 0.7% 2.3% 1.8% ’19A Capex % Revenue Teal Case A 2023E 1 Teal Case B 2023E 1 1.0% 1.0% Teal Case C 2023E 1 87.2 74.4 55.2 Similar 43.7 55.9 Teal 1 Teal Case A 2023E 1 Teal Case B 2023E 1 Teal Case C 2023E 1 1.0% 14.0% 14.6% NA 15.4% 11.1% ’21E EBITDA (Post - SBC) Margin NA 4 Days Core Current Liabilities as of 9/30/20 2,3 Similar Note: ’19A - ’21E Revenue CAGR (14.2%) Teal ( Mgmt Estimate) (13.3%) Gannett (Street) Teal Blended 2023E 1 1.0% Teal Blended 2023E 1 30
Unlevered Free Cash Flow Build ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Case A Case B Case C Blended Case February Model 2017A 2018A 2019A 2020E 2021E 2022E 2023E 2022E 2023E 2022E 2023E 2022E 2023E Revenue $1,156 $1,032 $946 $746 $695 $653 $622 $645 $597 $645 $597 $647 $603 % Growth (10.7%) (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) (7.3%) (7.5%) (7.3%) (7.5%) (7.0%) (6.8%) Pre-SBC EBITDA 92 91 86 72 111 114 117 106 89 88 70 108 96 Less: SBC (9) (10) (13) (5) (4) (4) (4) (4) (4) (4) (4) (4) (4) Post SBC EBITDA $82 $80 $73 $67 $107 $110 $113 $102 $85 $84 $66 $104 $92 % Growth (2.3%) (9.0%) (8.2%) 59.1% 3.2% 2.2% (4.5%) (16.6%) (21.6%) (21.7%) (2.6%) (11.6%) % Margin 7.1% 7.8% 7.7% 9.0% 15.4% 16.9% 18.1% 15.8% 14.3% 13.0% 11.0% 16.1% 15.3% Less: D&A ($48) ($51) ($21) ($9) ($8) ($7) ($5) ($7) ($5) ($7) ($5) ($7) ($5) Less: Adjusted Expenses (34) (75) (36) (24) (40) (12) (13) (12) (13) (12) (13) (12) (13) Plus: Property Sales – – 0 10 7 4 – 4 – 4 – 4 – EBT ($0) ($45) $16 $44 $66 $95 $95 $87 $67 $69 $48 $89 $74 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes 0 13 (5) (12) (19) (27) (27) (24) (19) (19) (13) (25) (21) NOPAT ($0) ($33) $12 $32 $48 $69 $68 $63 $48 $50 $34 $64 $53 Plus: D&A $48 $51 $21 $9 $8 $7 $5 $7 $5 $7 $5 $7 $5 Plus: Change in NWC (6) 4 10 (3) (2) (0) 3 1 5 1 5 0 4 Plus: SBC1 5 5 7 3 2 2 2 2 2 2 2 2 2 Less: Capex (24) (33) (22) (10) (6) (6) (6) (6) (6) (6) (6) (6) (6) % Capex / Revenue 2.1% 3.2% 2.3% 1.3% 0.9% 0.9% 1.0% 0.9% 1.0% 0.9% 1.0% 0.9% 1.0% Less: Pension Contribution (2) (3) (4) (4) (2) (2) (2) (2) (2) (2) (2) (2) (2) Plus: Tax Benefit from Pension Cont. 0 1 1 1 1 1 1 1 1 1 1 1 1 Unlevered Free Cash Flow $21 ($8) $25 $28 $49 $69 $71 $64 $53 $51 $38 $65 $57 % Growth n.m. n.m. 13.6% 74.0% 42.9% 2.0% 32.3% (18.1%) 5.2% (24.6%) 34.9% (12.8%) UFCF Conversion % 1.8% (0.7%) 2.6% 3.7% 7.0% 10.6% 11.4% 10.0% 8.8% 7.9% 6.5% 10.1% 9.5% Source: Teal Management, Company filings, FactSet and Wall Street Research. Note: Pro forma for sale of BestReviews . 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). Teal UFCF Build and Case Comparison 31
Flash Update Versus Board Approved Budget ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA Q1 Q2 Q3 Q4 Total Budget Revenue (2021) $172.3 $171.4 $170.4 $181.4 $695.5 Growth Over 2020 Actual (34.2) (0.3) (5.1) (11.2) (50.8) Flash Update Revenue (2021) $171.5 $171.8 $171.3 $182.3 $696.9 Change vs. Budget (0.8) 0.4 0.9 0.9 1.5 Budget Adjusted Pre-SBC EBITDA (2021) $21.8 $26.1 $27.2 $36.0 $111.0 Growth Over 2020 Actual 12.3 13.2 5.1 8.1 38.6 Flash Update Pre-SBC EBITDA (2021) $21.5 $27.2 $29.0 $37.8 $115.5 Change vs. Budget (0.3) 1.1 1.9 1.9 4.5 Source: Teal Management The Flash Update (which was sent to Amber / Moelis in late January) called for lower Q1 numbers (versus the Board approved Budget). Nevertheless, the Q2 – Q4 estimates increased due to cost reductions (primarily). These Q2 – Q4 cost reductions are a p ull forward of cost reductions contemplated later in the business plan forecasts (versus incremental cash flow). Given the Q1 dec lin es and the historical volatility in these Flash estimates (see next page), these Flash views are uncertain. Teal Management rema ins highly confident in their ability to achieve the Board Approved Budget from December. 32
Flash Update History Over Time – History Of Volatility ($ in millions) C APPENDIX – BUSINESS PLAN PROJECT ALINEA 2019 Annual Revenue 2020 Annual Revenue 2019 Annual Adj. EBITDA (Pre - SBC) 2020 Annual Adj. EBITDA (Pre - SBC) $1,000 $998 $993 $994 $992 $989 $986 $987 $985 $983 975 985 995 1,005 1,015 1,025 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Dec-19 Source: Teal Management. Note: Financials include BestReviews . Flash $903 $902 $821 $806 $809 $808 $804 $802 $801 $801 775 825 875 925 Jan-20 Mar-20 May-20 Jul-20 Sep-20 Dec-20 $105 $105 $107 $102 $102 $105 $105 $102 $101 95 100 105 110 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Dec-19 $105 $105 $105 $87 $89 $90 $97 $102 $102 $103 $102 $101 $101 85 90 95 100 105 110 Jan-20 Mar-20 May-20 Jul-20 Sep-20 Dec-20 $ $ $ $ Board Approved Budget Actual 33
CONFIDENTIAL D Appendix – DCF PROJECT ALINEA
Discounted Cash Flow Analysis D APPENDIX – DCF PROJECT ALINEA Source: DCFs based on Teal Case A, Case B, Case C and Blended Case projections. Price / Share Implied Perp. Growth Rate Implied Share Price At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x $14.92 $15.79 $16.65 $17.52 $18.38 14.82 15.67 16.53 17.38 18.24 14.72 15.56 16.41 17.25 18.09 14.62 15.45 16.28 17.12 17.95 14.52 15.35 16.17 16.99 17.80 Implied PGR At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x (10.9%) (8.5%) (6.6%) (5.1%) (3.9%) (10.5%) (8.1%) (6.2%) (4.7%) (3.4%) (10.1%) (7.7%) (5.8%) (4.2%) (3.0%) (9.7%) (7.2%) (5.3%) (3.8%) (2.5%) (9.2%) (6.8%) (4.9%) (3.4%) (2.1%) Implied Share Price At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x $13.11 $13.78 $14.45 $15.12 $15.79 13.03 13.69 14.36 15.02 15.68 12.95 13.61 14.26 14.91 15.56 12.87 13.52 14.17 14.81 15.45 12.80 13.44 14.07 14.71 15.34 Implied PGR At Assumed TV Multiples 3.0x 3.5x 4.0x 4.5x 5.0x (10.5%) (8.2%) (6.3%) (4.8%) (3.6%) (10.1%) (7.7%) (5.9%) (4.4%) (3.2%) (9.7%) (7.3%) (5.5%) (4.0%) (2.7%) (9.3%) (6.9%) (5.0%) (3.5%) (2.3%) (8.9%) (6.5%) (4.6%) (3.1%) (1.8%) Case A Case B Blended Case Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $17.32 $18.47 $19.62 $20.76 $21.90 9.5% 17.19 18.32 19.45 20.58 21.71 10.0% 17.05 18.17 19.29 20.40 21.52 10.5% 16.92 18.03 19.13 20.23 21.33 11.0% 16.80 17.88 18.97 20.06 21.14 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.2%) (8.8%) (6.9%) (5.3%) (4.1%) 9.5% (10.8%) (8.3%) (6.4%) (4.9%) (3.6%) 10.0% (10.4%) (7.9%) (6.0%) (4.5%) (3.2%) 10.5% (10.0%) (7.5%) (5.6%) (4.0%) (2.8%) 11.0% (9.6%) (7.1%) (5.2%) (3.6%) (2.3%) Case C Teal revenue declining 4.7% in 2023 Teal revenue declining 7.5% in 2023 Teal revenue declining 6.8% in 2023 Teal revenue declining 7.5% in 2023 34
D APPENDIX – DCF PROJECT ALINEA Unlevered Free Cash Flow Projections Source: Teal Case A. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $113mm. Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value 3 Represents after tax proceeds related to the sale of the New Jersey real estate and IP addresses / domain names. See page 43 for additional detail. Teal – DCF Valuation Analysis as of 12/31/2020 (Case A) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $746 $695 $653 $622 (5.9%) % Growth (8.4%) (21.1%) (6.8%) (6.1%) (4.7%) Pre-SBC EBITDA 86 72 111 114 117 17.3% Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $67 $107 $110 $113 18.8% $113 % Growth (9.0%) (8.2%) 59.1% 3.2% 2.2% % Margin 7.7% 9.0% 15.4% 16.9% 18.1% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $44 $66 $95 $95 29.0% $107 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (12) (19) (27) (27) (30) NOPAT $12 $32 $48 $69 $68 29.0% $77 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) (0) 3 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Plus: AT Proceeds from JC & IP Addresses – – – 28 – – Unlevered Free Cash Flow $25 $28 $49 $97 $71 36.4% $77 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $17.32 $18.47 $19.62 $20.76 $21.90 9.5% 17.19 18.32 19.45 20.58 21.71 10.0% 17.05 18.17 19.29 20.40 21.52 10.5% 16.92 18.03 19.13 20.23 21.33 11.0% 16.80 17.88 18.97 20.06 21.14 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.2%) (8.8%) (6.9%) (5.3%) (4.1%) 9.5% (10.8%) (8.3%) (6.4%) (4.9%) (3.6%) 10.0% (10.4%) (7.9%) (6.0%) (4.5%) (3.2%) 10.5% (10.0%) (7.5%) (5.6%) (4.0%) (2.8%) 11.0% (9.6%) (7.1%) (5.2%) (3.6%) (2.3%) Revenue is expected to decline by 4.7% in 2023 3 35
D APPENDIX – DCF PROJECT ALINEA DCF Valuation Analysis – Terminal Multiple Method Source: Teal Case A. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $113mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 See pages 44 and 45 for additional detail. 3 Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Case A) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $170 $261 $305 $348 $392 $435 $431 $474 $518 $561 $605 6.4x 7.1x 7.7x 8.4x 9.0x 9.5% 168 257 300 343 386 429 426 468 511 554 597 6.3 7.0 7.6 8.3 8.9 10.0% 167 254 296 339 381 423 421 463 505 548 590 6.3 6.9 7.5 8.2 8.8 10.5% 165 251 292 334 376 418 416 457 499 541 583 6.2 6.8 7.4 8.1 8.7 11.0% 164 247 288 330 371 412 411 452 493 534 576 6.1 6.7 7.3 8.0 8.6 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.2%) (8.8%) (6.9%) (5.3%) (4.1%) 60.6% 64.2% 67.2% 69.8% 72.0% 4.0x 4.4x 4.8x 5.3x 5.7x 9.5% (10.8%) (8.3%) (6.4%) (4.9%) (3.6%) 60.5% 64.1% 67.1% 69.7% 71.9% 4.0 4.4 4.8 5.2 5.6 10.0% (10.4%) (7.9%) (6.0%) (4.5%) (3.2%) 60.4% 64.0% 67.0% 69.6% 71.8% 3.9 4.3 4.7 5.1 5.5 10.5% (10.0%) (7.5%) (5.6%) (4.0%) (2.8%) 60.3% 63.9% 66.9% 69.5% 71.7% 3.9 4.3 4.7 5.1 5.5 11.0% (9.6%) (7.1%) (5.2%) (3.6%) (2.3%) 60.2% 63.8% 66.8% 69.4% 71.6% 3.8 4.2 4.6 5.0 5.4 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $652 $696 $739 $783 $826 $17.32 $18.47 $19.62 $20.76 $21.90 9.5% 647 690 733 776 819 17.19 18.32 19.45 20.58 21.71 10.0% 642 684 727 769 811 17.05 18.17 19.29 20.40 21.52 10.5% 637 679 721 762 804 16.92 18.03 19.13 20.23 21.33 11.0% 632 674 715 756 797 16.80 17.88 18.97 20.06 21.14 FV Build Shares Outstanding FV $516 (-) PV of Pension Liability (Post-2023)¹ (7) (-) PV of Adj. Expenses (Post-2023)2 (4) FV (after Pension) $505 (-) Net Debt3 221 Equity Value $727 (+) Options Proceeds 4 FD Equity $731 / FDSO 37.901 Implied Share Price $19.29 36
D APPENDIX – DCF PROJECT ALINEA Unlevered Free Cash Flow Projections Source: Teal Case B. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $85mm. Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 3 Represents after tax proceeds related to the sale of the New Jersey real estate and IP addresses / domain names. See page 43 for additional detail. Teal – DCF Valuation Analysis as of 12/31/2020 (Case B) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $746 $695 $645 $597 (7.2%) % Growth (8.4%) (21.1%) (6.8%) (7.3%) (7.5%) Pre-SBC EBITDA 86 72 111 106 89 7.2% Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $67 $107 $102 $85 8.2% $85 % Growth (9.0%) (8.2%) 59.1% (4.5%) (16.6%) % Margin 7.7% 9.0% 15.4% 15.8% 14.3% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $44 $66 $87 $67 15.0% $79 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (12) (19) (24) (19) (22) NOPAT $12 $32 $48 $63 $48 15.0% $57 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) 1 5 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Plus: AT Proceeds from JC & IP Addresses – – – 28 – – Unlevered Free Cash Flow $25 $28 $49 $92 $53 23.5% $57 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $14.92 $15.79 $16.65 $17.52 $18.38 9.5% 14.82 15.67 16.53 17.38 18.24 10.0% 14.72 15.56 16.41 17.25 18.09 10.5% 14.62 15.45 16.28 17.12 17.95 11.0% 14.52 15.35 16.17 16.99 17.80 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.9%) (8.5%) (6.6%) (5.1%) (3.9%) 9.5% (10.5%) (8.1%) (6.2%) (4.7%) (3.4%) 10.0% (10.1%) (7.7%) (5.8%) (4.2%) (3.0%) 10.5% (9.7%) (7.2%) (5.3%) (3.8%) (2.5%) 11.0% (9.2%) (6.8%) (4.9%) (3.4%) (2.1%) Revenue is expected to decline by 7.5% in 2023 3 37
D APPENDIX – DCF PROJECT ALINEA DCF Valuation Analysis – Terminal Multiple Method Source: Teal Case B. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $85mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 See pages 44 and 45 for additional detail. 3 Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Case B) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $143 $197 $230 $263 $296 $328 $340 $373 $405 $438 $471 5.1x 5.5x 6.0x 6.5x 7.0x 9.5% 142 194 227 259 292 324 336 368 401 433 465 5.0 5.5 6.0 6.4 6.9 10.0% 140 192 224 256 288 320 332 364 396 428 460 4.9 5.4 5.9 6.4 6.8 10.5% 139 189 221 252 284 315 328 360 391 423 455 4.9 5.4 5.8 6.3 6.8 11.0% 138 187 218 249 280 311 325 356 387 418 449 4.8 5.3 5.8 6.2 6.7 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.9%) (8.5%) (6.6%) (5.1%) (3.9%) 58.0% 61.7% 64.8% 67.4% 69.7% 3.2x 3.5x 3.8x 4.1x 4.4x 9.5% (10.5%) (8.1%) (6.2%) (4.7%) (3.4%) 57.9% 61.6% 64.7% 67.3% 69.6% 3.1 3.4 3.8 4.1 4.4 10.0% (10.1%) (7.7%) (5.8%) (4.2%) (3.0%) 57.7% 61.4% 64.5% 67.2% 69.5% 3.1 3.4 3.7 4.0 4.3 10.5% (9.7%) (7.2%) (5.3%) (3.8%) (2.5%) 57.6% 61.3% 64.4% 67.1% 69.3% 3.1 3.4 3.7 4.0 4.3 11.0% (9.2%) (6.8%) (4.9%) (3.4%) (2.1%) 57.4% 61.2% 64.3% 66.9% 69.2% 3.0 3.3 3.6 3.9 4.2 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $561 $594 $627 $660 $693 $14.92 $15.79 $16.65 $17.52 $18.38 9.5% 557 590 622 655 687 14.82 15.67 16.53 17.38 18.24 10.0% 554 586 617 649 681 14.72 15.56 16.41 17.25 18.09 10.5% 550 581 613 644 676 14.62 15.45 16.28 17.12 17.95 11.0% 546 577 608 639 671 14.52 15.35 16.17 16.99 17.80 FV Build Shares Outstanding FV $415 (-) PV of Pension Liability (Post-2023)¹ (7) (-) PV of Adj. Expenses (Post-2023)2 (12) FV (after Pension) $396 (-) Net Debt3 221 Equity Value $617 (+) Options Proceeds 4 FD Equity $622 / FDSO 37.887 Implied Share Price $16.41 38
D APPENDIX – DCF PROJECT ALINEA Unlevered Free Cash Flow Projections Source: Teal Case C. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $66mm. Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 3 Represents after tax proceeds related to the sale of the New Jersey real estate and IP addresses / domain names. See page 43 for additional detail. Teal – DCF Valuation Analysis as of 12/31/2020 (Case C) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $746 $695 $645 $597 (7.2%) % Growth (8.4%) (21.1%) (6.8%) (7.3%) (7.5%) Pre-SBC EBITDA 86 72 111 88 70 (1.3%) Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $67 $107 $84 $66 (0.8%) $66 % Growth (9.0%) (8.2%) 59.1% (21.6%) (21.7%) % Margin 7.7% 9.0% 15.4% 13.0% 11.0% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $44 $66 $69 $48 2.6% $60 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (12) (19) (19) (13) (17) NOPAT $12 $32 $48 $50 $34 2.6% $43 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) 1 5 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Plus: AT Proceeds from JC & IP Addresses – – – 28 – – Unlevered Free Cash Flow $25 $28 $49 $79 $38 11.4% $43 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $13.11 $13.78 $14.45 $15.12 $15.79 9.5% 13.03 13.69 14.36 15.02 15.68 10.0% 12.95 13.61 14.26 14.91 15.56 10.5% 12.87 13.52 14.17 14.81 15.45 11.0% 12.80 13.44 14.07 14.71 15.34 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.5%) (8.2%) (6.3%) (4.8%) (3.6%) 9.5% (10.1%) (7.7%) (5.9%) (4.4%) (3.2%) 10.0% (9.7%) (7.3%) (5.5%) (4.0%) (2.7%) 10.5% (9.3%) (6.9%) (5.0%) (3.5%) (2.3%) 11.0% (8.9%) (6.5%) (4.6%) (3.1%) (1.8%) Revenue is expected to decline by 7.5% in 2023 3 39
D APPENDIX – DCF PROJECT ALINEA DCF Valuation Analysis – Terminal Multiple Method Source: Teal Case C. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $66mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 See pages 44 and 45 for additional detail. 3 Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Case C) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $120 $152 $177 $202 $228 $253 $272 $297 $322 $347 $373 4.0x 4.4x 4.8x 5.2x 5.5x 9.5% 119 150 175 200 225 250 269 294 318 343 368 4.0 4.4 4.7 5.1 5.5 10.0% 118 148 172 197 222 246 266 290 315 340 364 4.0 4.3 4.7 5.1 5.4 10.5% 117 146 170 194 219 243 263 287 311 336 360 3.9 4.3 4.6 5.0 5.4 11.0% 116 144 168 192 216 240 260 284 308 332 356 3.9 4.2 4.6 4.9 5.3 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (10.5%) (8.2%) (6.3%) (4.8%) (3.6%) 55.9% 59.7% 62.8% 65.5% 67.9% 2.5x 2.8x 3.0x 3.3x 3.5x 9.5% (10.1%) (7.7%) (5.9%) (4.4%) (3.2%) 55.7% 59.5% 62.7% 65.4% 67.7% 2.5 2.7 3.0 3.2 3.4 10.0% (9.7%) (7.3%) (5.5%) (4.0%) (2.7%) 55.6% 59.4% 62.5% 65.2% 67.6% 2.5 2.7 2.9 3.2 3.4 10.5% (9.3%) (6.9%) (5.0%) (3.5%) (2.3%) 55.4% 59.2% 62.4% 65.1% 67.5% 2.5 2.7 2.9 3.1 3.4 11.0% (8.9%) (6.5%) (4.6%) (3.1%) (1.8%) 55.3% 59.1% 62.2% 65.0% 67.3% 2.4 2.7 2.9 3.1 3.3 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $493 $518 $544 $569 $594 $13.11 $13.78 $14.45 $15.12 $15.79 9.5% 490 515 540 565 590 13.03 13.69 14.36 15.02 15.68 10.0% 487 512 536 561 586 12.95 13.61 14.26 14.91 15.56 10.5% 484 508 533 557 581 12.87 13.52 14.17 14.81 15.45 11.0% 481 505 529 553 577 12.80 13.44 14.07 14.71 15.34 FV Build Shares Outstanding FV $335 (-) PV of Pension Liability (Post-2023)¹ (7) (-) PV of Adj. Expenses (Post-2023)2 (13) FV (after Pension) $315 (-) Net Debt3 221 Equity Value $536 (+) Options Proceeds 0 FD Equity $536 / FDSO 37.617 Implied Share Price $14.26 40
D APPENDIX – DCF PROJECT ALINEA Unlevered Free Cash Flow Projections Source: Teal Blended Case. Note: DCF valuation as of December 31, 2020 using end of year discounting convention. Terminal values based off of 2023E Post - SB C EBITDA of $92mm. Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. 1 Add back 50% of SBC during the planning period (50% accounted for in the fully diluted share count). 2 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 3 Represents after tax proceeds related to the sale of the New Jersey real estate and IP addresses / domain names. See page 43 for additional detail. Teal – DCF Valuation Analysis as of 12/31/2020 (Blended Case) ($ in millions, except per share values) Per Teal Management Fiscal Year Ended December 31, 20E - '23E Terminal 2019A 2020E 2021E 2022E 2023E CAGR Value Revenue $946 $746 $695 $647 $603 (6.9%) % Growth (8.4%) (21.1%) (6.8%) (7.0%) (6.8%) Pre-SBC EBITDA 86 72 111 108 96 9.9% Less: SBC (13) (5) (4) (4) (4) Post-SBC EBITDA $73 $67 $107 $104 $92 11.0% $92 % Growth (9.0%) (8.2%) 59.1% (2.6%) (11.6%) % Margin 7.7% 9.0% 15.4% 16.1% 15.3% Less: D&A ($21) ($9) ($8) ($7) ($5) ($6) Less: Adjusted Expenses (36) (24) (40) (12) (13) – Plus: Property Sales – 10 7 4 – – EBT $16 $44 $66 $89 $74 18.8% $86 Tax Rate 28.0% 28.0% 28.0% 28.0% 28.0% 28.0% Less: Cash Taxes (5) (12) (19) (25) (21) (24) NOPAT $12 $32 $48 $64 $53 18.8% $62 Plus: D&A $21 $9 $8 $7 $5 $6 Plus: Change in NWC 10 (3) (2) 0 4 – Plus: SBC1 7 3 2 2 2 – Less: Capex (22) (10) (6) (6) (6) (6) % Capex / Revenue 2.3% 1.3% 0.9% 0.9% 1.0% Less: Pension Contribution2 (4) (4) (2) (2) (2) – Plus: Tax Ben. From Pension 1 1 1 1 1 – Plus: AT Proceeds from JC & IP Addresses – – – 28 – – Unlevered Free Cash Flow $25 $28 $49 $93 $57 27.0% $62 Teal DCF Analysis Implied Share Price At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $15.53 $16.47 $17.40 $18.34 $19.27 9.5% 15.42 16.34 17.27 18.19 19.11 10.0% 15.31 16.22 17.14 18.05 18.96 10.5% 15.21 16.11 17.01 17.90 18.80 11.0% 15.10 15.99 16.88 17.76 18.65 Implied PGR At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.0%) (8.6%) (6.7%) (5.2%) (3.9%) 9.5% (10.6%) (8.2%) (6.3%) (4.7%) (3.5%) 10.0% (10.2%) (7.7%) (5.8%) (4.3%) (3.0%) 10.5% (9.7%) (7.3%) (5.4%) (3.9%) (2.6%) 11.0% (9.3%) (6.9%) (5.0%) (3.4%) (2.2%) Revenue is expected to decline by 6.8% in 2023 3 41
D APPENDIX – DCF PROJECT ALINEA DCF Valuation Analysis – Terminal Multiple Method Source: Teal Blended Case. Note: DCF valuation as of December 31, 2020. Cash flows discounted using year - end convention. Terminal values based off 2023E Po st - SBC EBITDA of $92mm. Balance sheet as of December 31, 2020. 1 Remaining pension obligation of $10mm (present value of $7mm) assumed to be funded at YE’23 ($17mm at 12/31/20 less $7mm fund ed from ’21 - ’23) and discounted to present value. 2 See pages 44 and 45 for additional detail. 3 Net debt includes cash of $221mm (as of 12/31/20). Cash balance is pro forma for the $160mm sale of BestReviews , which was announced on 12/16/2020. Teal – DCF Valuation Analysis (Blended Case) ($ in millions, except per share values) PV of Terminal Value Implied Firm Value Implied FV / 2020E EBITDA PV of At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC Forecast 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $150 $213 $249 $284 $320 $355 $363 $398 $434 $469 $505 5.4x 5.9x 6.5x 7.0x 7.5x 9.5% 149 210 245 280 315 350 359 394 429 464 499 5.3 5.9 6.4 6.9 7.4 10.0% 147 207 242 276 311 345 355 389 424 458 493 5.3 5.8 6.3 6.8 7.3 10.5% 146 204 239 273 307 341 351 385 419 453 487 5.2 5.7 6.2 6.7 7.2 11.0% 145 202 235 269 303 336 347 380 414 448 481 5.2 5.7 6.2 6.7 7.2 Implied PGR Terminal Value as % of FV Implied FV / 2021E EBITDA At Assumed TV Multiples At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% (11.0%) (8.6%) (6.7%) (5.2%) (3.9%) 58.7% 62.4% 65.5% 68.1% 70.3% 3.4x 3.7x 4.1x 4.4x 4.7x 9.5% (10.6%) (8.2%) (6.3%) (4.7%) (3.5%) 58.6% 62.3% 65.3% 68.0% 70.2% 3.4 3.7 4.0 4.3 4.7 10.0% (10.2%) (7.7%) (5.8%) (4.3%) (3.0%) 58.5% 62.1% 65.2% 67.8% 70.1% 3.3 3.6 4.0 4.3 4.6 10.5% (9.7%) (7.3%) (5.4%) (3.9%) (2.6%) 58.3% 62.0% 65.1% 67.7% 70.0% 3.3 3.6 3.9 4.2 4.6 11.0% (9.3%) (6.9%) (5.0%) (3.4%) (2.2%) 58.2% 61.9% 65.0% 67.6% 69.9% 3.2 3.6 3.9 4.2 4.5 Implied Equity Value Implied Share Price At Assumed TV Multiples At Assumed TV Multiples WACC 3.0x 3.5x 4.0x 4.5x 5.0x 3.0x 3.5x 4.0x 4.5x 5.0x 9.0% $584 $620 $655 $691 $726 $15.53 $16.47 $17.40 $18.34 $19.27 9.5% 580 615 650 685 720 15.42 16.34 17.27 18.19 19.11 10.0% 576 611 645 680 714 15.31 16.22 17.14 18.05 18.96 10.5% 572 606 640 674 708 15.21 16.11 17.01 17.90 18.80 11.0% 568 602 635 669 703 15.10 15.99 16.88 17.76 18.65 FV Build Shares Outstanding FV $440 (-) PV of Pension Liability (Post-2023)¹ (7) (-) PV of Adj. Expenses (Post-2023)2 (10) FV (after Pension) $424 (-) Net Debt3 221 Equity Value $645 (+) Options Proceeds 4 FD Equity $649 / FDSO 37.887 Implied Share Price $17.14 42
Address: 125 Theodore Conrad Dr, Jersey City, NJ 07305 Ownership: JV with an affiliate of the Zuckerman family; Teal owns 49.9% Square Footage: ~450,000 (industrial property) Land: 9.9998 acres Tax basis in land of $3.5mm; tax basis in building of $1mm The NJ real estate (expect to exit facility by the end of 2021) has an estimated value of $0.32 - $0.53 / share (assuming a sale at the end of 2022). IP addresses / la.com domain name has an estimated value of $0.08 - $0.12 / share (assuming a sale in 2022). In total, th e two sets of assets have $0.40 to $0.65 per share of value, so we assume $0.60 / share of value. NJ Real Estate and IP Address / Domain Name Valuation Analysis ($ in millions, except per share values) D APPENDIX – DCF PROJECT ALINEA Real Estate Summary – Assume 2022 Sale IP Address / Domain Name Summary – Assume 2022 Sale Source: Teal Management, Company filings, FactSet, NJ Department of the Treasury, and Real Capital Analytics. Note: Illustrative valuations above exclude transaction costs. NPV’s assume a 10% WACC and that the assets are sold at the end o f 2022 (per Teal Management). 1 Real estate comps include sales of industrial buildings in Jersey City located within one mile of 125 Theodore that occurred aft er 2017 (5 transactions). 2 Taxes on gains computed using a $4.5mm tax basis for the real estate and a $0.8mm tax basis for the la.com domain name and IP ad dresses. 3 A recent prospective buyer noted that the usable square footage at 125 Theodore is approximately 300K square feet based on th eir assessment of the building’s footprint. 4 The low / high valuations are based on Brandsight LLC and Hilco Streambank (IP valuation and consulting advisory firms) reports. 5 Two - character domain name comparables data provided by Brandsight LLC (median / mean metrics suggest values of $2.4mm and $3.6mm, respectively). Teal owns the la.com domain and two /16 IPv4 blocks Teal received a $1.5mm IOI from Live Auctioneers (Nov - 20) for the la.com domain (range of $2mm - $4mm per consulting reports) 4 /16 blocks contain ~65,000 addresses Amazon offered to purchase the /16 blocks for $3.4mm (July - 20), and market data indicates a per address price range of $22 - $26 Tax basis in la.com of $0.8mm; zero tax basis in IP addresses Market Analysis Prior Low Midpoint High Offers la.com $2.0 $3.0 $4.0 $1.5 Two /16 IPv4 Blocks 2.9 3.1 3.4 3.4 Valuation $4.9 $6.1 $7.4 $4.9 Taxes (28%) (1.1) (1.5) (1.9) (1.1) After Tax Value $3.7 $4.6 $5.6 $3.7 FDSO 37.901 37.901 37.901 37.901 Value per Share $0.10 $0.12 $0.15 $0.10 NPV per Share (10% WACC) $0.08 $0.10 $0.12 $0.08 Recent SalesLow Median High Tax Value $ / Sq. Ft. $124.54 $128.21 $141.40 $141.06 Total Valuation (450K Sq. Ft.) $56.0 $57.7 $63.6 $63.5 % Ownership 49.9% 49.9% 49.9% 49.9% Valuation $28.0 $28.8 $31.8 $31.7 Taxes (28%) (6.6) (6.8) (7.6) (7.6) After Tax Value $21.4 $22.0 $24.1 $24.1 FDSO 37.901 37.901 37.901 37.901 Value per Share $0.56 $0.58 $0.64 $0.63 NPV per Share (10% WACC) $0.47 $0.48 $0.53 $0.52 Memo Total Valuation (300K Sq. Ft.) $37.4 $38.5 $42.4 $42.3 After Tax Value to Teal 14.7 15.1 16.5 16.5 Value per Share $0.39 $0.40 $0.44 $0.43 NPV per Share (10% WACC) $0.32 $0.33 $0.36 $0.36 1 2 2 3 5 4 43
Terminal Value – Adjusted Expenses ($ in millions) D APPENDIX – DCF PROJECT ALINEA Assume 2023 print and digital revenue growth rates apply beyond 2023 Assume EBITDA (post - SBC) margins are held constant at 2023 levels Assume Adjusted Expenses (e.g. restructuring charges) as a percentage of the change in annual Opex are held constant at 2023 levels (the 2023 levels are consistent with historical rates) Calculate the NPV of the after - tax Adjusted Expenses beyond 2023 (until the Opex base begins to grow with revenues) 2023 Print Revenue Growth (13.5%) (16.0%) (16.0%) (15.4%) 2023 Digital Revenue Growth 15.0% 11.9% 11.9% 12.7% Year Total Revenue Growth is Positive 2026 2027 2027 2027 2023 EBITDA Margin 18.1% 14.3% 11.0% 15.3% 2023 Adj. Exp. as a % Change in Opex 38.5% 41.0% 42.7% 40.3% NPV @ 12/31/20 @ 9% WACC $4 $13 $14 $10 NPV @ 12/31/20 @ 10% WACC 4 12 13 10 NPV @ 12/31/20 @ 11% WACC 4 12 13 10 Parameter Case A Case B Case C Source: Teal Management. Blended 44
DCF Supporting Detail – Terminal Adjusted Expenses ($ in millions, except per share values) D APPENDIX – DCF PROJECT ALINEA Source: Teal Management. Terminal Period 2023E 2024E 2025E 2026E 2027E Illustrative Impact to Valuation EBITDA $113 $109 $108 $109 $113 Margin % 18.1% 18.1% 18.1% 18.1% 18.1% NPV of Adj. Expenses @ 12/31/23 $8 (-) Taxes @ 28% (2) Opex $509 $494 $490 $494 $509 NPV of After Tax Adj. Expenses @ 12/31/23 $6 Change in Opex (33) (15) (5) 5 15 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $4 Adj. Expenses $13 $6 $2 – – / FDSO 37.9 % of Change in Opex 38.5% 38.5% 38.5% 38.5% 38.5% Impact per Share @ 12/31/20 $0.11 EBITDA $85 $80 $77 $76 $76 Margin % 14.3% 14.3% 14.3% 14.3% 14.3% NPV of Adj. Expenses @ 12/31/23 $23 (-) Taxes @ 28% (6) Opex $512 $482 $464 $456 $456 NPV of After Tax Adj. Expenses @ 12/31/23 $16 Change in Opex (31) (29) (18) (8) 1 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $12 Adj. Expenses $13 $12 $7 $3 – / FDSO 37.9 % of Change in Opex 41.0% 41.0% 41.0% 41.0% 41.0% Impact per Share @ 12/31/20 $0.33 EBITDA $66 $62 $59 $58 $58 Margin % 11.0% 11.0% 11.0% 11.0% 11.0% NPV of Adj. Expenses @ 12/31/23 $25 (-) Taxes @ 28% (7) Opex $531 $501 $482 $473 $474 NPV of After Tax Adj. Expenses @ 12/31/23 $18 Change in Opex (30) (30) (19) (9) 1 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $13 Adj. Expenses $13 $13 $8 $4 – / FDSO 37.6 % of Change in Opex 42.7% 42.7% 42.7% 42.7% 42.7% Impact per Share @ 12/31/20 $0.36 EBITDA $92 $87 $85 $84 $84 Margin % 15.3% 15.3% 15.3% 15.3% 15.3% NPV of Adj. Expenses @ 12/31/23 $18 (-) Taxes @ 28% (5) Opex $511 $485 $470 $465 $469 NPV of After Tax Adj. Expenses @ 12/31/23 $13 Change in Opex (32) (26) (15) (5) 4 / Discount Factor (3 years, 10% WACC) 1.33 NPV of Adj. Expenses @ 12/31/20 $10 Adj. Expenses $13 $10 $6 $2 – / FDSO 37.9 % of Change in Opex 40.3% 40.3% 40.3% 40.3% 40.3% Impact per Share @ 12/31/20 $0.26 Case A Case B Case C Blended 45
CONFIDENTIAL E Appendix – WACC PROJECT ALINEA
Teal WACC Analysis: Selected Range of 9% - 11% ($ in millions) E APPENDIX – WACC Current Public Comparables Source: Teal Management, Company filings, Barra Beta Book, Bloomberg, FactSet, Duff & Phelps, MSCI and U.S. Department of the Tr easury. Note: Market values as of February 12, 2021. 1 Levered Beta = Unlevered Beta x [1 + (1 - Tax Rate)(Debt/Equity)]. 2 Long - horizon expected equity risk premium (historical): large company stock total returns minus long - term government bond income returns (Source: Duff & Phelps). 3 Represents 30 - year U.S. Treasury yield as of February 12, 2021. 4 Cost of Equity = (Risk Free Rate of Return) + (Levered Beta)(Equity Risk Premium). 5 Weighted Average Cost of Capital = (After - Tax Cost of Debt)(Debt/Cap) + (Cost of Equity)(Equity/Cap). PROJECT ALINEA Illustrative Calculations WACC Sensitivity 7.0 – 9.0% WACC: CS 7.3 – 9.3% WACC: Jefferies 8.0 – 9.0% WACC: Greenhill 7.0 – 8.0% WACC: GS 9.5% WACC: Greenhill 7.0 – 8.0% WACC: GS New Media: Gannett: Pro Forma: Unlevered Beta 1.000 1.200 Target Debt / Cap – 30.0% Target Debt / Equity – 42.9% Levering Factor 1.000 1.309 Levered Beta¹ 1.000 1.570 Equity Risk Premium² 7.2% 7.2% Risk Premium 7.2% 11.2% Risk Free (30-Year Treasury)³ 2.0% 2.0% Cost of Equity4 9.2% 13.2% Pre-Tax Cost of Debt – 8.5% Marginal Tax Rate 28.0% 28.0% Calculated WACC5 9.2% 11.1% Debt / Asset Beta Cap Cost of Debt 1.000 1.050 1.100 1.150 1.200 – – 9.2% 9.5% 9.9% 10.2% 10.6% 15.0% 6.5% 9.3% 9.6% 9.9% 10.3% 10.6% 15.0% 7.5% 9.4% 9.7% 10.0% 10.4% 10.7% 15.0% 8.5% 9.5% 9.8% 10.2% 10.5% 10.8% 30.0% 6.5% 9.4% 9.7% 10.0% 10.3% 10.7% 30.0% 7.5% 9.6% 9.9% 10.2% 10.6% 10.9% 30.0% 8.5% 9.8% 10.1% 10.4% 10.8% 11.1% Capital Structure Local Beta (2 Year, Weekly, Raw) Equity Debt / Debt / Levered Unlevered Levered Unlevered Marginal Value Cap. Equity Beta Beta Beta Beta Tax Rate Teal $600 – – 1.171 1.171 1.547 1.547 28.0% Gannett 763 66.0% 194.5% 2.110 0.886 2.915 1.224 29.0% Lee Enterprises 137 79.3% NM 1.428 0.402 0.990 0.279 33.3% News Corp 14,155 8.2% 8.9% 1.009 0.949 1.018 0.958 29.1% New York Times 8,243 – – 0.899 0.899 0.794 0.794 26.0% Barra Predicted Bloomberg Historical Public Benchmarks: New Media / Gannett Merger Proxy and Lee Cost of Debt Cost of debt for New Media / Gannett: 11.5% from Apollo PF Leverage of 3.4x 2019E EBITDA Cost of debt for Lee: 9.0% from Berkshire Hathaway PF Leverage of 3.8x 2019A EBITDA 46
Historical Betas – Last Five Years E APPENDIX – WACC PROJECT ALINEA Predicted Barra Local Beta FactSet 2 - Year Trailing Betas Teal Source: MSCI and FactSet. GCI NWSA NYT Teal Teal 1Yr. 3Yr. 5Yr. High 1.59 1.59 1.90 Median 1.52 0.54 0.79 Low 0.46 0.10 0.10 Teal Avg. 1.45 0.79 0.97 1Yr. 3Yr. 5Yr. High 1.33 1.35 1.74 Median 1.23 1.06 1.24 Low 0.91 0.77 0.77 Teal Avg. 1.20 1.08 1.24 0.00 0.50 1.00 1.50 2.00 2.50 3.00 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 0.00 0.50 1.00 1.50 2.00 2.50 3.00 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 LEE GCI LEE NWSA NYT GCI LEE NWSA NYT 1.57 1.00 1.57 1.00 47
Predicted Barra Local Beta Historical Ranges E APPENDIX – WACC PROJECT ALINEA 0.908 1.528 1.061 0.856 1.005 1.329 2.186 1.627 0.984 1.081 1.171 2.110 1.428 0.899 1.009 Teal GCI LEE NYT NWSA L6M Range LTM Range Current 12 Month and 6 Month Historical Ranges Source: MSCI. Note: Represents Predicted Barra Local Beta ranges. Last 12 Months Max 1.329 2.186 1.627 0.984 1.081 Median 1.230 2.099 1.508 0.899 1.024 Min 0.908 1.528 1.061 0.856 1.005 48
CONFIDENTIAL F Appendix – Other Potential Parties PROJECT ALINEA
Voting Scenarios (Shares in millions) F APPENDIX – OTHER POTENTIAL PARTIES PROJECT ALINEA Amber Proposal Alternative Proposal Source: Teal Management, company filings and FactSet. 1 Showing the minimum number of public votes necessary for the relevant proposal to pass. 2 Assumes that 70% of the total public shares (non - PSS / Amber) participate in the vote. 3 PSS is assumed to vote in favor of the highest sale price proposal given he was understood to have had conversations with Amb er and Slaine in July 2020 regarding a sale of his shares. 4 Basic shares outstanding only. Excludes options and RSUs. Shares % of Public Float (Voting) Voting Requirement 2/3 vote of the outstanding non - Amber shares (not by written consent) Majority of the outstanding voting stock All Vote 70% Vote 2 All Vote 70% Vote 2 Minimum Public - For1 8.038 8.038 9.656 9.656 Public - Against 8.391 3.462 6.772 1.844 Total Voting Public 16.429 11.500 16.429 11.500 PSS Shares - For3 8.744 8.744 8.744 8.744 Amber - Against NA NA 11.554 11.554 Total Voting 25.172 20.244 36.727 31.798 % in Favor 66.7% 82.9% 50.1% 57.9% Amber - For 11.554 11.554 – – Public Non-Voting Shares – 4.929 – 4.929 Total Shares Outstanding 4 36.727 36.727 36.727 36.727 % in Favor 77.2% 77.2% 50.1% 50.1% % in Favor (excl. Amber) 66.7% 66.7% 48.9% 69.9% 58.8% 84.0% Minimum Public - For 51.1% 30.1% 41.2% 16.0% Public - Against 100.0% 100.0% 100.0% 100.0% Slaine and BestReviews Management hold 4.7mm shares 49
History of Strategic Discussions F APPENDIX – OTHER POTENTIAL PARTIES PROJECT ALINEA Timeline Description Summer 2018 Donerail discussions ( Donerail to buy Teal and sell - off the pieces); ultimately, Donerail never secured financing for a “bust - up” Fall 2018 Process to sell the company (rumors of the process made it into the press); led to McClatchy discussions which were terminated when McClatchy could not secure financing Winter / Spring 2019 Gannett discussions regarding a combination (Teal as buyer or seller) after Amber / MediaNews announced an unsolicited offer for Gannett; Gannett ultimately merged with New Media in November 2019 Spring 2019 McClatchy discussions regarding ( i ) a full combination, and (ii) the sale of Teal Florida to McClatchy; McClatchy could not secure financing and ultimately went through bankruptcy Summer / Fall 2019 Apollo discussions regarding financing for a special dividend; given Apollo’s positions in New Media / Gannett and Cox Broadcasting (which raised regulatory concerns), Apollo and Teal terminated discussions (after Apollo repeatedly revised the terms, making the loan smaller and more onerous to Teal) Fall 2019 Amber approached about a cash / stock merger between MediaNews and Teal; Ferro (as the largest Teal shareholder and company consultant) indicated he would support an all cash deal at $13 / share; Amber withdrew from the discussions November 2019 – March 2020 Amber acquired 32% of Teal without board approval (Delaware 203 not waived). Amber entered into a standstill on 12/2/19 and began discussing potential intercompany agreements between Amber - owned MediaNews and Teal (these talks were complicated by Delaware 203). In January 2020, Amber approached Teal for a standstill waiver in order to buy Patrick Soon - Shiong’s 25% stake in Teal for $13.50 per share (waiver was not granted). Amber made a private approach to the Teal board in February 2020 to acquire all of the Teal shares it did not own for $13.50 / share. These discussions were halted due to COVID - 19 disruptions Summer 2020 Teal understood that PSS had conversations with Amber and Slaine in July regarding a potential sale of his stake in Teal (this led to the adoption of the shareholder rights plan) 50
F APPENDIX – OTHER POTENTIAL PARTIES PROJECT ALINEA Source: Teal Management and Public Filings. Note: Market values as of February 12, 2021 and December 30, 2020, respectively. Balance sheet as of Q3 2020 for Gannett and Q4 2020 for Teal. 1 Based on illustrative $17.25 per share offer. 2 EBITDA adds back pension expense of $15mm for Gannett and $2mm for Teal. Gannett Merger with Teal @ $17.25 Per Share (All Stock) ($ in millions, except per share values) Gannett At 2/12/21 Price Gannett At 12/30/20 Price SQ SQ Pro Forma SQ SQ Pro Forma Gannett Teal @ $17.25 Gannett Teal @ $17.25 Price / Share $5.26 $17.25 $5.26 $2.90 $17.25 $2.90 (x) FDSO 145.1 37.9 269.3 145.1 37.9 370.5 Fully Diluted Equity $763 $654 $1,417 $421 $654 $1,074 (-) Options Proceeds – (4) (4) – (4) (4) Equity Value $763 $649 $1,413 $421 $649 $1,070 Ownership 54.0% 46.0% 100.0% 39.3% 60.7% 100.0% Debt $1,484 – $1,484 $1,484 – $1,484 Minority Interest 4 – 4 4 – 4 Investments (36) – (36) (36) – (36) Cash (254) (221) (476) (254) (221) (476) Firm Value w/o Pension $1,961 $428 $2,389 $1,619 $428 $2,047 2020E Adj. EBITDA (post-SBC) $328 $67 $395 $328 $67 $395 2020E Adj. EBITDA (pre-SBC) 356 72 428 356 72 428 FV / 2020E Adj. EBITDA (post-SBC) 6.0x 6.4x 6.0x 4.9x 6.4x 5.2x Debt / 2020E Adj. EBITDA (pre-SBC) 4.2 – 3.5 4.2 – 3.5 Net Debt / 2020E Adj. EBITDA (pre-SBC) 3.5 – 2.4 3.5 – 2.4 Pensions $117 $17 $134 $117 $17 $134 Firm Value w/ Pension $2,078 $445 $2,523 $1,736 $445 $2,181 2020E Adj. EBITDA (post-SBC) $343 $69 $412 $343 $69 $412 2020E Adj. EBITDA (pre-SBC) 371 74 445 371 74 445 FV / 2020E Adj. EBITDA (post-SBC) 6.1x 6.5x 6.1x 5.1x 6.5x 5.3x Debt / 2020E Adj. EBITDA (pre-SBC) 4.3 0.2 3.6 4.3 0.2 3.6 Net Debt / 2020E Adj. EBITDA (pre-SBC) 3.6 – 2.6 3.6 – 2.6 1 2 2 1 In an all stock deal the combined company would have ~2.5x net leverage and Teal shareholders would own 61% of the combined company (assuming Gannett’s 12/30/20 undisturbed stock price). The combined company would need to trade for 5x+ (without synergies) in order to hold its value (i.e., deliver $17.25 per share to Teal shareholders). 51
Letter from Stewart Bainum , Jr. F APPENDIX – OTHER POTENTIAL PARTIES PROJECT ALINEA January 5 , 2021 Special Committee of The Board of Directors Teal Publishing Company 160 N . Stetson Avenue Chicago, IL 60601 Care of Eric Medow, Lazard LLC Ladies and Gentlemen : I write to express my continued interest in the acquisition of The Baltimore Sun Media Group ("The Sun") from Teal Publishing Company . As you know, I have recently discussed the acquisition of The Sun with Amber Global Capital in connection with Amber's proposal to purchase all of the stock in Teal that it does not own . While those discussions are at a preliminary stage and we are hopeful they will soon progress, it is far from certain that they will . If I cannot reach an agreement with Amber on a fair value for The Sun in conjunction with their bid for Teal, I am willing to explore with the Special Committee purchasing all of the outstanding shares of Teal at a reasonable price that will deliver fair value to all Teal shareholders . I have engaged financial, legal and diligence advisors and we are prepared to move expeditiously to complete customary due diligence and negotiate and consummate a mutually acceptable transaction – whether it be for a purchase of the outstanding shares of Teal or for The Sun alone . Please contact me if I can provide any additional information helpful to the Special Committee . Sincerely, Stewart Bainum, Jr . LETTER TO THE TEAL SPECIAL COMMITTEE, 5 JANUARY 2021 52
AIM / Tides + Trive ($ in millions, except per share values) F APPENDIX – OTHER POTENTIAL PARTIES PROJECT ALINEA SOTP as Presented by Halbreich Source: AIM / Tides submissions and discussions (as well as discussions with Trive ). 1 Excludes $11mm of assumed Baltimore EBITDA. 2 Assumed sale price. 3 Reduced by $4mm of options proceeds. '21E Multiple Value Market EBITDA Low High Low High Chicago $40 4.25x 5.00x $170 $200 New York (5) 25 35 Hartford 11 4.25 4.50 47 50 Orlando 10 5.00 6.00 50 60 Ft. Lauderdale 10 5.00 6.00 50 60 TCA 4 7.00 8.00 28 32 Allentown 8 4.25 4.50 34 36 VA Pilot 8 4.50 5.00 36 40 Daily Press 8 4.50 5.00 36 40 Total $94 $476 $553 BestReviews Cash 90 90 Teal Cash @ 12/31 125 125 Total Equity Value $691 $768 Shares 36.6 36.6 Price per Share $18.87 $20.97 Baltimore $11 4.55x 4.55x $50 $50 Shares 36.6 36.6 Value per Share $1.37 $1.37 Adjusted Price per Share $20.24 $22.34 Sources & Uses AIM / Tides Price / Share $15.00 Assumed Shares 37.0 Equity Value $555 Fees & Expenses 10 Total Uses $565 Cash $190 Term Loan 170 Trive Preferred Equity 100 Other Preferred Equity 15 Other Equity 50 AIM / Tides 40 Total Sources $565 Need 45 days of diligence While SOTP is shown, the proposal does not necessarily assume a sale in pieces (and hence tax leakage) Trive will backstop the term loan Commentary 1 2 2 1.8x EBITDA and ~50% of capitalization To be bridged with additional term loan – – $105mm of uncommitted equity; 2/13/21 AIM / Tides indicated they had a term sheet for $65mm of equity from an unnamed source (leaves $40mm uncommitted) Additional ~$114mm needed due to $17.25 price / share (with the current fully diluted shares) and $20mm of Teal fees and expenses (leaves $154mm uncommitted) 3 53
CONFIDENTIAL G Appendix – Teal Shareholders PROJECT ALINEA
# Shareholder Ownership Stake and Cumulative Holdings Current Market Value 1yr ∆ in % O/S Total Ownership Breakdown 1 1 Amber Global Capital $184 (0.4%) 2 Patrick Soon - Shiong 139 (0.3%) 3 Mason Slaine 46 +7.8% 4 BestReviews 31 (0.1%) 5 Dimensional Holdings 24 +0.2% 6 BlackRock 20 (0.2%) 7 Morgan Stanley 19 +3.0% 8 Renaissance Technologies 14 +0.4% 9 Vanguard 13 (0.7%) Top 10 Shareholder Concentration Evolution 10 BrightSphere Investment Group 12 (0.2%) 11 State Street 9 +0.5% 12 Northern Trust 6 +0.4% 13 Geode Capital Management 6 +0.2% 14 Terry Jimenez 4 +0.3% 15 Arrowstreet Capital 4 +0.1% 16 Quinn Opportunity Partners 4 -- 17 Timothy Knight 3 +0.4% 18 PRIMECAP Management 3 (5.5%) 19 Charles Schwab 2 +0.1% 20 Jacobs Levy Equity Management 2 +0.1% 21 David Dreier 2 -- 22 Grantham, Mayo, Van Otterloo & Co. 2 (0.3%) 23 GFH HFEVA 2 +0.1% 24 Credit Suisse 2 (0.1%) 25 AXA SA 2 +0.3% Teal's Top 25 Shareholders ($ in millions) 23.9% 7.8% 5.2% 4.1% 3.4% 3.2% 2.5% 2.3% 2.1% 1.5% 1.0% 1.0% 0.7% 0.7% 0.7% 0.6% 0.6% 0.4% 0.4% 0.4% 0.3% 0.3% 0.3% 0.3% 31.6% 55.6% 63.4% 68.6% 72.8% 76.2% 79.4% 81.9% 84.2% 86.3% 87.8% 88.8% 89.8% 90.5% 91.2% 91.8% 92.4% 93.0% 93.4% 93.7% 94.1% 94.4% 94.7% 95.1% 95.4% Top 5 Top 10 Top 15 Top 20 Top 25 Source: FactSet as per most recent filings. Note: Market pricing as of February 12, 2021. Ownership stake based on basic shares outstanding, consolidated across funds. One - year prior date of December 31, 2019, and five - year prior date of December 31, 2015. 1 Reflects entire shareholder base, not just top 25 shareholders, as per FactSet holdings information. PROJECT ALINEA G APPENDIX – TEAL SHAREHOLDERS Insider 40% Passive 9% Active 51% 72.8% 86.3% 71.5% 83.7% 48.5% 67.7% 1 2 3 4 5 6 7 8 9 10 Shareholder # Cumulative % O/S Today 1 Year ago 5 Years ago 54
CONFIDENTIAL H Appendix – Offer Price Multiples PROJECT ALINEA
H APPENDIX – OFFER PRICE MULTIPLES PROJECT ALINEA Source: Teal Management. Note: Balance sheet as of Q4 2020. Stock Based Compensation abbreviated as SBC. 1 Adjusted for the add back of $2mm of pension expense. Teal Multiples at $17.25 / share ($ in millions, except per share values) Parameter Without Pensions With Pensions Offer Price $17.25 $17.25 Implied Premium to Undisturbed (12/30/20) 34.9% 34.9% Implied Premium to Current (02/12/21) 8.2% 8.2% FDSO 37.887 37.887 Fully Diluted Equity Value $654 $654 Less: Cash Proceeds from Options (4) (4) Equity Value $649 $649 Plus: Debt – – Plus: Pensions 17 Less: Unrestricted Cash (191) (191) Less: Restricted Cash (30) (30) Firm Value $428 $445 Metric Metric FV / '20E Pre-SBC EBITDA $72 5.9x $74 6.0x FV / '20E Post-SBC EBITDA 67 6.4 69 6.5 FV / '21E Pre-SBC EBITDA 111 3.9 113 3.9 FV / '21E Post-SBC EBITDA 107 4.0 109 4.1 1 Versus Gannett multiple of 5.5x 55