DRAFT — PRIVILEGED AND CONFIDENTIAL / ATTORNEY-CLIENT PRIVILEGED
Prepared by Calderwood & Harkness LLP
RESOLUTIONS OF THE BOARD OF DIRECTORS OF AURELIUS GLOBAL MEDIA GROUP PLC
Engagement of Independent Governance Counsel
March 12, 2024
WHEREAS, Aurelius Global Media Group PLC ("AGMG" or the "Company") is a public limited company incorporated in the State of Delaware, with its Certificate of Incorporation originally filed with the Secretary of State of the State of Delaware on September 14, 2009 (Delaware File Number 4827193; Employer Identification Number 26-4831097), and is registered as an overseas company in England and Wales pursuant to Part 34 of the Companies Act 2006. The Company maintains its principal executive offices at 14 Sceptre Row, London EC2V 7QN, United Kingdom. The Company's shares of common stock, par value $0.01 per share (the "Common Stock"), are listed on the New York Stock Exchange under the ticker symbol "AGMG" and are admitted to the premium segment of the Official List maintained by the Financial Conduct Authority and to trading on the London Stock Exchange Main Market under the ticker symbol "AGMG.L." As of March 1, 2024, the Company has approximately 412,600,000 shares of Common Stock issued and outstanding and an approximate market capitalization of £6.82 billion (approximately $8.65 billion based on then-prevailing exchange rates). The Company is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the rules and regulations of the U.S. Securities and Exchange Commission (the "SEC"), the listing standards of the New York Stock Exchange, and the UK Listing Rules, the Disclosure Guidance and Transparency Rules, and the UK Corporate Governance Code, each as applicable to the Company;
WHEREAS, Marcus Vane resigned as Chief Executive Officer and Executive Director of the Company effective March 8, 2024, citing personal and family considerations, and tendered his resignation from the Board of Directors of the Company (the "Board") concurrently therewith. The Board accepted Mr. Vane's resignation at a special meeting of the Board held on March 8, 2024, and, in order to ensure continuity of executive leadership during the transition period, designated Priya Nair-Whitfield, the Company's Chief Operating Officer and an Executive Director of the Company, as Interim Chief Executive Officer of the Company, such appointment to be effective immediately upon Mr. Vane's resignation. The Board further resolved to undertake a comprehensive and rigorous CEO succession process, to be conducted with the assistance of an executive search firm, to identify and appoint a permanent successor to Mr. Vane as Chief Executive Officer of the Company on a timeline to be determined by the Board in its sole discretion;
WHEREAS, Corvus Peak Capital Partners LP ("Corvus Peak"), a Delaware limited partnership whose general partner is Corvus Peak Management LLC, a Delaware limited liability company, and whose Founding Partner and Chief Investment Officer is Damien Solberg, filed an initial Schedule 13D with the SEC on January 18, 2024 (the "Initial 13D"), disclosing beneficial ownership of approximately 6.1% of the Company's outstanding shares of Common Stock. The Initial 13D disclosed, among other things, that Corvus Peak had been acquiring shares of Common Stock over a period beginning in October 2023 and that Corvus Peak intended to engage in discussions with the Board and management of the Company regarding the Company's strategic direction, capital allocation practices, and corporate governance;
WHEREAS, on February 12, 2024, Corvus Peak sent a letter (the "Demand Letter") to the Board, a copy of which was simultaneously made public through a press release issued by Corvus Peak, setting forth certain demands, including: (i) the appointment of two new independent directors to the Board with specific qualifications in digital media and financial restructuring, to be selected through a process in which Corvus Peak would have meaningful input; (ii) the immediate commencement of a comprehensive strategic review of the Company's business segments, including an evaluation of potential divestitures, asset sales, or other strategic transactions involving the Company's legacy print media division and its European broadcasting assets; and (iii) the implementation of a formal and transparent CEO succession plan to be overseen by an independent committee of the Board, with regular disclosure to shareholders regarding the status and timeline of such process;
WHEREAS, on February 26, 2024, Corvus Peak filed an amendment to its Schedule 13D (the "Amended 13D") disclosing that it had increased its beneficial ownership stake in the Company to approximately 8.7% of the outstanding shares of Common Stock, representing approximately 35,896,200 shares. The Amended 13D further disclosed Corvus Peak's intention to nominate a slate of three director candidates for election at the Company's 2024 Annual General Meeting of stockholders (the "2024 AGM") in the event that the Board did not engage constructively with Corvus Peak's proposals within a timeframe that Corvus Peak deemed reasonable;
WHEREAS, on March 1, 2024, Corvus Peak formally submitted, in accordance with the advance notice provisions set forth in Article II, Section 12 of the Company's Amended and Restated Bylaws, director nominations for the 2024 AGM (the "Corvus Peak Nominations"), proposing the following individuals as nominees for election to the Board: (a) Malcolm Trask, a former Chief Financial Officer of a Fortune 500 media company and current private equity advisor; (b) Vanessa Loring, a digital media executive and former Senior Vice President of Strategy at a major streaming platform; and (c) Dr. Raymond Chu, a professor of corporate finance at Columbia Business School and former independent director of two publicly traded technology companies. Corvus Peak has indicated publicly that it believes the current Board composition does not adequately reflect the skill sets, diversity of perspectives, and independent judgment necessary to navigate the Company's current strategic challenges, and that the election of the Corvus Peak Nominees would serve the best interests of all stockholders;
WHEREAS, the Company's standing outside counsel, Ashworth Velmoran LLP, a law firm headquartered in New York, New York, has served as primary outside legal counsel to AGMG and its management since 2015, advising the Company on a broad range of matters including corporate transactions, securities compliance, intellectual property, employment matters, and general corporate affairs. The Board recognizes and values the longstanding relationship between the Company and Ashworth Velmoran LLP, but has determined that, in light of the current circumstances — including the CEO succession process, the activist campaign by Corvus Peak, and the heightened scrutiny that these matters will receive from stockholders, proxy advisory firms, regulatory bodies, and the media — Ashworth Velmoran LLP may be perceived by certain stockholders and other third parties as primarily aligned with management rather than with the Board as a whole, and that such perception, whether or not well-founded, could undermine the credibility and effectiveness of the Board's governance processes;
WHEREAS, the Board has determined, in the exercise of its fiduciary duties and business judgment, that it is advisable and in the best interests of the Company and its stockholders to engage independent governance counsel to advise the Board directly — separate from and independent of management counsel — in connection with: (i) the CEO succession process following the resignation of Marcus Vane; (ii) the Board's evaluation of and response to the activist campaign by Corvus Peak, including the Demand Letter, the Corvus Peak Nominations, and any related proxy contest, negotiation, settlement, or other engagement with Corvus Peak; and (iii) the review and, as appropriate, enhancement of the Company's corporate governance framework as it relates to the foregoing matters and the Board's broader governance responsibilities;
WHEREAS, Calderwood & Harkness LLP ("C&H"), a New York limited liability partnership with its principal office at 787 Seventh Avenue, New York, New York 10019, and a London office at 25 Bishopsgate, London EC2N 3AR, United Kingdom, has been identified as qualified independent counsel possessing deep expertise in corporate governance, activist defense, fiduciary duty matters, proxy contests, and board advisory engagements. C&H has extensive experience advising boards of directors of dual-listed and multinational public companies in matters of the type contemplated by this engagement. The firm's reputation for independence, discretion, and rigor is well-recognized in the legal and financial communities;
WHEREAS, C&H has confirmed that it has conducted a thorough conflicts check in accordance with its internal policies and applicable rules of professional conduct, and has determined that it has no conflicts of interest with respect to the Company, any current director or officer of the Company, Corvus Peak Capital Partners LP, Corvus Peak Management LLC, Damien Solberg, any of the Corvus Peak Nominees, Blackthorn Howell & Crane LLP (which has been identified as counsel to Corvus Peak in connection with the activist campaign), Ashworth Velmoran LLP, or any other known related party to the matters that are the subject of this engagement. C&H has further confirmed that it does not currently represent, and has not within the preceding twenty-four months represented, any of the foregoing parties in any matter;
WHEREAS, the proposed engagement team at C&H consists of the following individuals: (a) Nathaniel Bower, Partner, who shall serve as the Responsible Partner and primary point of contact for the Board and the Chair; (b) Colette Whitman, Partner, who shall serve as the Billing Partner and co-lead on substantive governance matters; (c) Audrey Zhou, Senior Associate, who shall serve as the Lead Associate on the engagement; and (d) Brendan Walsh, Associate, who shall serve as the Working Associate on the engagement. Additional attorneys, paralegals, and other professional staff may be assigned to the engagement from time to time as reasonably necessary, subject to the approval of the Chair or her designee;
WHEREAS, C&H has submitted an engagement letter dated March 12, 2024 (the "Engagement Letter"), setting forth the proposed terms of the engagement, including, without limitation, the following material provisions:
(a) Scope of Engagement: C&H shall serve as independent board governance counsel, advising the Board on CEO succession, activist response strategy and tactics, related corporate governance matters, and such other matters as the Board or the Chair may direct from time to time;
(b) Fee Arrangement: C&H shall bill for its services on an hourly basis at the following standard 2024 billing rates: Nathaniel Bower (Partner) at $1,750 per hour; Colette Whitman (Partner) at $1,625 per hour; Audrey Zhou (Senior Associate) at $985 per hour; and Brendan Walsh (Associate) at $725 per hour. Rates for other timekeepers, if any, shall be at C&H's standard 2024 rates as set forth in the Engagement Letter;
(c) Retainer: An initial evergreen retainer of $75,000 shall be paid upon execution of the Engagement Letter. The retainer shall be held by C&H in its client trust account and shall be applied against fees and expenses as they are incurred. The retainer shall be replenished quarterly to the full $75,000 amount, with replenishment invoices issued at the beginning of each calendar quarter during the term of the engagement;
(d) Expenses: The Company shall reimburse C&H for reasonable out-of-pocket expenses incurred in connection with the engagement, including but not limited to travel, filing fees, document production costs, and third-party vendor charges;
(e) Governing Law: The Engagement Letter and the engagement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflict-of-laws principles;
(f) Termination: Either party may terminate the engagement upon written notice to the other party, subject to C&H's obligations under applicable rules of professional conduct regarding withdrawal from representation and the Company's obligation to pay for services rendered and expenses incurred through the effective date of termination;
WHEREAS, a complete copy of the Engagement Letter has been presented to the Board and has been reviewed by Dame Elspeth Greenvale, Independent Non-Executive Chair of the Board, and Nadine Khalil, General Counsel and Corporate Secretary of the Company, each of whom has confirmed that the terms set forth therein are reasonable and appropriate in light of the nature and complexity of the matters for which C&H is being engaged;
WHEREAS, the Board has reviewed the qualifications, independence, reputation, engagement team composition, and proposed fee arrangements of C&H, and, after due consideration and deliberation, has determined that the engagement of C&H as independent governance counsel to the Board is advisable, in the best interests of the Company and its stockholders, and consistent with the Board's fiduciary duties under the Delaware General Corporation Law, including the duties of care and loyalty, and the Board's responsibilities under the UK Corporate Governance Code and applicable listing and regulatory requirements;
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors of Aurelius Global Media Group PLC hereby authorizes and approves the engagement of Calderwood & Harkness LLP as independent governance counsel to the Board of Directors of the Company, in connection with: (i) the CEO succession process following the resignation of Marcus Vane, including the identification, evaluation, and appointment of a permanent Chief Executive Officer; (ii) the Board's evaluation of and response to the activist campaign by Corvus Peak Capital Partners LP, including the Demand Letter, the Corvus Peak Nominations, any proxy contest, any negotiation, settlement, or cooperation agreement with Corvus Peak, and all related strategic, legal, and communications matters; (iii) the review and, as appropriate, enhancement of the Company's corporate governance framework as it relates to the foregoing matters, including Board composition, committee structure, director qualifications, and governance policies; and (iv) such other related matters as the Board or the Independent Non-Executive Chair may direct from time to time in the exercise of the Board's fiduciary duties and governance responsibilities.
RESOLVED FURTHER, that the Board hereby approves the Engagement Letter dated March 12, 2024, between Aurelius Global Media Group PLC and Calderwood & Harkness LLP, substantially in the form presented to the Board at this meeting (the "Engagement Letter"), which Engagement Letter sets forth the scope, fee arrangements, retainer terms, and other conditions of the engagement as described in the recitals hereto. Dame Elspeth Greenvale, in her capacity as Independent Non-Executive Chair of the Board, is hereby authorized, empowered, and directed to execute and deliver the Engagement Letter on behalf of the Board, with such non-material modifications, amendments, or additions as she may approve in her reasonable discretion and in consultation with the Company's General Counsel and Corporate Secretary.
RESOLVED FURTHER, that Calderwood & Harkness LLP shall report directly to the Board of Directors through Dame Elspeth Greenvale, Independent Non-Executive Chair, and shall have such access to the Company's officers, directors, employees, books, records, corporate minutes, financial information, strategic plans, and external advisors (including, without limitation, the Company's financial advisors, proxy solicitors, investor relations consultants, and public relations firms) as is reasonably necessary to fulfill its engagement and to provide effective, informed legal counsel to the Board, subject at all times to applicable legal privileges, confidentiality obligations, and the Company's policies regarding the handling of material non-public information. Calderwood & Harkness LLP shall coordinate and cooperate with the Company's standing outside counsel, Ashworth Velmoran LLP, and the Company's General Counsel and Corporate Secretary, Nadine Khalil, as appropriate and as necessary to avoid duplication of effort, ensure consistency of legal positions, and promote efficient use of the Company's legal resources; provided, however, that the delineation of respective roles, responsibilities, and work streams as between Calderwood & Harkness LLP and Ashworth Velmoran LLP shall be established by the Independent Non-Executive Chair, in consultation with C&H's Responsible Partner, Nathaniel Bower, and shall be documented in a coordination protocol to be circulated to the Board, the General Counsel and Corporate Secretary, and the lead partners of both firms within a reasonable time following the execution of the Engagement Letter.
RESOLVED FURTHER, that the Company is hereby authorized and directed to pay to Calderwood & Harkness LLP: (a) the initial retainer of $75,000 (Seventy-Five Thousand United States Dollars) upon execution of the Engagement Letter, with such retainer to be replenished quarterly in accordance with the terms of the Engagement Letter, including replenishment to the full $75,000 amount at the beginning of each calendar quarter during the term of the engagement; (b) hourly fees as incurred in accordance with the billing rates set forth in the Engagement Letter, as described in the recitals hereto, with invoices to be rendered monthly in arrears and payable within thirty (30) days of receipt; and (c) reasonable out-of-pocket expenses incurred by C&H in connection with the engagement, including but not limited to travel expenses, filing fees, document reproduction and production costs, and charges for third-party vendors engaged at the direction of C&H in furtherance of the engagement. Nadine Khalil, General Counsel and Corporate Secretary, and Garrett Voss, Chief Financial Officer, are each individually authorized to review, approve, and direct payment of invoices rendered by C&H for fees and expenses in accordance with the terms of the Engagement Letter and the Company's standard accounts payable procedures, without the need for further Board authorization, provided that aggregate fees and expenses in excess of $1,500,000 (One Million Five Hundred Thousand United States Dollars) during any rolling twelve-month period shall be reported to the Board for information purposes at the next regularly scheduled Board meeting following the date on which such threshold is exceeded.
RESOLVED FURTHER, that the Board acknowledges and confirms that Calderwood & Harkness LLP is being engaged as counsel to the Board of Directors as a body, in its collective capacity, and not as counsel to any individual director, any individual officer, any committee of the Board, the Company's management, or any other person or entity. The attorney-client privilege with respect to all communications, advice, memoranda, work product, and other materials generated by or provided by Calderwood & Harkness LLP in connection with this engagement shall be held by the Board of Directors collectively, and no individual director, officer, or employee shall have the authority to waive or otherwise compromise such privilege without the express prior authorization of the Board acting by resolution duly adopted at a meeting at which a quorum is present. The engagement of Calderwood & Harkness LLP as independent governance counsel to the Board is intended to be complementary to, and not in replacement of, the Company's longstanding relationship with Ashworth Velmoran LLP as standing outside counsel to the Company and its management, and nothing in these resolutions or in the Engagement Letter shall be construed to limit, modify, or terminate the Company's engagement of Ashworth Velmoran LLP or any other legal advisor retained by the Company or its management.
RESOLVED FURTHER, that Dame Elspeth Greenvale, Independent Non-Executive Chair of the Board, is hereby authorized and empowered to take such further actions, provide such further instructions, and execute and deliver such further documents, instruments, certificates, and agreements as may be necessary, advisable, or desirable to effectuate the engagement of Calderwood & Harkness LLP as contemplated by these resolutions, including, without limitation: (a) providing supplemental instructions regarding the scope and priorities of the engagement as circumstances may warrant; (b) communicating the Board's views, concerns, and strategic priorities to C&H and receiving reports and recommendations from C&H on behalf of the Board; (c) coordinating with C&H, Ashworth Velmoran LLP, and other advisors on matters arising between regularly scheduled Board meetings; (d) approving the assignment of additional C&H personnel to the engagement team as reasonably necessary; and (e) taking such other actions as may be consistent with the purposes and intent of these resolutions and the Board's fiduciary duties, with any such actions to be reported to the full Board at the next regularly scheduled meeting.
RESOLVED FURTHER, that each of the officers of the Company, including, without limitation, the Interim Chief Executive Officer, the Chief Financial Officer, and the General Counsel and Corporate Secretary, is hereby authorized and directed, acting singly or together, to take all such further actions and to execute and deliver all such further documents, instruments, certificates, and agreements, in the name and on behalf of the Company, as such officer may deem necessary, advisable, or desirable to carry out the purposes and intent of the foregoing resolutions, including, without limitation, the execution and delivery of any ancillary agreements, supplements, amendments, or modifications to the Engagement Letter, the payment of fees and expenses as authorized herein, and the provision of information and access to C&H as contemplated by these resolutions. The taking of any such actions and the execution and delivery of any such documents by any such officer shall be conclusive evidence of the approval thereof by the Board of Directors.
RESOLVED FURTHER, that all actions heretofore taken by any officer, director, employee, or authorized representative of the Company in connection with the matters contemplated by the foregoing resolutions, including, without limitation, any preliminary discussions, negotiations, or correspondence with Calderwood & Harkness LLP, the exchange of conflict check information, the circulation of draft engagement terms, and any other preparatory actions, are hereby ratified, confirmed, and approved in all respects as the acts and deeds of the Company, with the same force and effect as if such actions had been authorized by the Board prior to their being taken.
CERTIFICATION
The undersigned, Nadine Khalil, General Counsel and Corporate Secretary of Aurelius Global Media Group PLC, hereby certifies that the foregoing resolutions were duly adopted by the Board of Directors of the Company at a meeting of the Board duly convened and held on March 12, 2024, in accordance with the Company's Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, at which a quorum of directors was present and acting throughout the entirety of the proceedings. These resolutions were adopted by the affirmative vote of a majority of the directors present at such meeting, and such resolutions have not been amended, modified, or rescinded and remain in full force and effect as of the date set forth below.
IN WITNESS WHEREOF, the undersigned has executed this certification as of the date set forth below.
AURELIUS GLOBAL MEDIA GROUP PLC
By: ________
Name: Nadine Khalil
Title: General Counsel & Corporate Secretary
Date: March 12, 2024
EXHIBIT A
Engagement Letter dated March 12, 2024, between Aurelius Global Media Group PLC and Calderwood & Harkness LLP
[Attached hereto and incorporated herein by reference]