(A correction has been added to this story)
The problem with being a publicly traded company is all your missteps are there for everyone to see. The problem with being a publicly traded company that gives bonuses and enhanced severance packages to top executives is it’s there for everyone to see.
The problem with being a publicly traded company that does all that while trading at 5 cents a share, admitting they are close to bankruptcy, and laying off hundreds of employees is it angers all your past and present employees, especially those recently laid off with little more than a couple weeks severance.
So it goes for GateHouse Media, the newspaper giant that sprung from nothing to more than 500 daily and weekly papers, including the Patriot Ledger, the Brockton Enterprise, and more than 100 others in Massachusetts. In its annual filing with the Securities and Exchange Commission, the company acknowledged $1.4 million handed out in bonuses to their top executives while reporting a nearly $10 million drop in operating income as well as an 8.6 percent decline in advertising revenue.
In addition, the company reports a revision in the severance packages of CEO Mike Reed and Kirk Davis, the president and COO who was the head of the Community Newspaper Company in Massachusetts that publishes 88 weeklies, including the Tab newspapers. Under the revision, if either loses their job involuntarily, Reed will get 27 months of his salary plus a monthly average of the annual bonus while Davis gets two years of salary and bonus.
In a press release, GateHouse put the best spin on the numbers but failed to mention the bonuses or severance package.
All this comes as GateHouse is revamping its operations by consolidating its copy editing desks at two locations for all the 500 national papers. The Rockford, Illinois, newspaper will house copy editing for publications with a circulation of 5,000 or more while the Framingham office of the Metrowest Daily News will handle copy editing for those papers with circulation under 5,000 copies. GateHouse is touting the new centers will employ 70 people but they’re not saying out loud the move will cut 300 jobs around the country
, including at the Ledger and Enterprise, two of the company’s bigger outlets. (A GateHouse editor says the Ledger and Enterprise are not included in the “central desks.”)
Some of the problems were presaged in a 2008 CommonWealth piece by media observer Dan Kennedy about GateHouse and the perils of media companies in general.
The annual report shows the company, which Reed started with little capital and a whole bunch of loans, has $4.6 million due to creditors this year but in 2014, a whopping $1.2 billion balloon payment is due, and the company admits it doesn’t have the cash or the cachet to refinance.
“If we are unable to repay our indebtedness at maturity we may be forced to liquidate or reorganize our operations and business under the federal bankruptcy laws,” the report states.
But if they do declare bankruptcy and Reed, who received an $800,000 bonus for last year, and Davis, who got a $350,000 bonus, are forced out, they just guaranteed themselves a soft landing with the severance deals. That is what is irking those who left and scares those who stayed behind.
One former staffer on Facebook, noting the company’s performance on Wall Street, summed up the feeling succinctly: “They should have paid them in stock options.”
Loose lips: Jailed former House speaker Sal DiMasi testified for five hours before a federal grand jury investigating the Probation Department hiring scandal but didn’t give them anything juicy on any lawmakers, according the Boston Globe, which got its account from several sources who say they heard it from state Rep. Angelo Scaccia, who apparently got the skinny from DiMasi when he visited the former speaker at the Rhode Island prison where he was being held temporarily.
Norfolk District Attorney Michael Morrissey claims the Supreme Judicial Court’s Judiciary-Media Committee, which has been in place since 1995, is too skewed in favor of the press and wants more representation for victims.
The power is finally back on to all customers blacked out by Tuesday’s transformer fire in the Back Bay. Brian McGrory seems ready to blame NStar chief executive Tom May for the outage, then says it’s not necessarily his fault — but does want to remind everyone that May earns an obscene $8 million salary for running a publicly-regulated utility. Meanwhile, Senator Kerry requests federal help for small businesses affected by the blackout. Mayor Tom Menino wants city workers to inspect electrical substations, but May says an inspection wouldn’t have caught the problem that caused this week’s fire.
Swampscott considers establishing a historic district.
NECN looks back at Boston’s Irish politicians.
Paul Krugman takes on the “Drill, baby, drill” caucus.
A presidential rankings expert — we didn’t know there was such a thing, either — says if President Obama is reelected, he would rank fourth behind Abraham Lincoln, Franklin Roosevelt and George Washington but if he loses, his legacy drops to 22nd.
The New Republic’s Noam Scheiber doesn’t think the new Obamacumentary quite hits it right.
Joe Biden flies to Ohio to do his Biden-y thing.
Mitt Romney is spending big, again, this time in Illinois. Rick Santorum says that before Puerto Rico becomes a state, it has to comply with some nonexistent law and learn how to speak English. Related: The GOP goes looking for Hispanic votes in swing states. The Atlantic asks, is Newt Gingrich literally crazy?
The Lowell Sun reports on the Republican battle to choose the next challenger to US Rep. Niki Tsongas.
The high price of gold combined with the continuing economic struggles has triggered an explosion of pawn shops.
Three in 10 young adults have moved back in with their parents, a trend that has been building for decades but has been exacerbated by the weak economy and high college debt.
Big banks are no longer on the verge of collapse, so now they want to buy the most toxic parts of AIG’s old mortgage-backed portfolio. Obviously.
In the next act in their ever-escalating standoff with OneUnited Bank, Boston ministers will travel to Los Angeles next week to ask California depositors to withdraw their money from the bank.
Ten teachers at Fall River’s three underperforming schools, which the state says must extend school hours and educator responsibilities to bring performance up, have asked to be transferred.
There will be no “pink slime” containing ground beef served in Boston school cafeterias.
Officials in the Wilbraham-Hampden Regional School District get slammed by the conservative commentariat over their attempt to mark St. Patrick’s Day a day early.
Harvard takes a reporter on a tour of its primate research center in Southborough to showcase steps it claims to have taken to improve conditions after the deaths of four monkeys at the facility over the last two years.
Biogen donates $500,000 to an ALS research fund established by former governor Paul Cellucci who suffers from the disease.
The Marblehead Board of Selectmen plans to issue letters to state officials urging them to support an MBTA deficit reduction plan that does not include bus service cuts, the Lynn Daily Item reports.
San Francisco ties parking meter rates to supply and demand economics.
The Newburyport Daily News gets a guided tour of the leaky tunnels underneath the Seabrook nuclear power station, which are showing some signs of water infiltration.
A Plymouth District Court judge, either ignorant of the law or ignoring it, refused to allow a Patriot Ledger reporter to be at a hospital arraignment of a Plymouth woman charged with child rape and did not explain his reason, as required by court rule.
A Hamilton police sergeant shot and wounded a Beverly police officer and then killed himself because of a relationship the Beverly officer had with his wife, according to reports released by the Essex District Attorney and Beverly Police Department.
A Gloucester Times editorial argues that the criminal justice system failed in the case of a Level 3 sex offender who exposed himself to a young girl and was subsequently released from prison on bail.
The Lawrence Eagle Tribune reports Mayor William Lantigua’s former chief of staff testified before a grand jury yesterday, as part of an investigation into Lantigua’s administration.
Nancy Gertner and Barry Scheck consider ways to rein in “rogue prosecutors” in a Wall Street Journal op-ed column.
Keller@Large is rethinking his news and information consumption, trying to cut out empty calorie offerings.