-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AKA/HuE5dIbzK0VP49WXuW/l2v6SinzW1P379F3xNA4pAayz7Y2koBKA7FD6wM53 idff5Hu1l1CpVi3CUigsCg== 0000909518-07-000138.txt : 20070214 0000909518-07-000138.hdr.sgml : 20070214 20070214173203 ACCESSION NUMBER: 0000909518-07-000138 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20070214 DATE AS OF CHANGE: 20070214 GROUP MEMBERS: 4322525 CANADA INC. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SUN-TIMES MEDIA GROUP INC CENTRAL INDEX KEY: 0000868512 STANDARD INDUSTRIAL CLASSIFICATION: NEWSPAPERS: PUBLISHING OR PUBLISHING & PRINTING [2711] IRS NUMBER: 953518892 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-43563 FILM NUMBER: 07623148 BUSINESS ADDRESS: STREET 1: 350 NORTH ORLEANS ST STREET 2: FLOOR 10 SOUTH CITY: CHICAGO STATE: IL ZIP: 60654-1771 BUSINESS PHONE: 3123212299 MAIL ADDRESS: STREET 1: 350 NORTH ORLEANS ST STREET 2: FLOOR 10 SOUTH CITY: CHICAGO STATE: IL ZIP: 60654-1771 FORMER COMPANY: FORMER CONFORMED NAME: HOLLINGER INTERNATIONAL INC DATE OF NAME CHANGE: 19951020 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN PUBLISHING COMPANY DATE OF NAME CHANGE: 19940204 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HOLLINGER INC CENTRAL INDEX KEY: 0000911707 STANDARD INDUSTRIAL CLASSIFICATION: NEWSPAPERS: PUBLISHING OR PUBLISHING & PRINTING [2711] IRS NUMBER: 135691211 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 10 TORONTO ST STREET 2: TORONTO CITY: ONTARIO CANADA STATE: A6 ZIP: 00000 BUSINESS PHONE: 4163638721 MAIL ADDRESS: STREET 1: 10 TORONTO ST STREET 2: TORONTO CITY: ONTARIO CANADA STATE: A6 ZIP: 00000 SC 13D 1 mv2-14_13d.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. __________)* SUN-TIMES MEDIA GROUP, INC. - -------------------------------------------------------------------------------- (Name of Issuer) CLASS A COMMON STOCK, PAR VALUE $.01 PER SHARE - -------------------------------------------------------------------------------- (Title of Class of Securities) 86688Q100 - -------------------------------------------------------------------------------- (CUSIP Number) G. WESLEY VOORHEIS AUTHORIZED REPRESENTATIVE HOLLINGER INC. 10 TORONTO STREET TORONTO, ONTARIO CANADA M5C 2B7 (416) 363-8721 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) FEBRUARY 13, 2007 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [ ] NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See ss.240.13d-7 for other parties to whom copies are to be sent. *The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). Page 2 of 16
CUSIP No. 86688Q100 - -------------------------------------------------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only). Hollinger Inc. - -------------------------------------------------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) ______ (b) ______ - -------------------------------------------------------------------------------------------------------------------------- 3. SEC Use Only - -------------------------------------------------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - -------------------------------------------------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [_] - -------------------------------------------------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Canada - -------------------------------------------------------------------------------------------------------------------------- 7. Sole Voting Power 2,166,979 Number of Shares Beneficially Owned by Each Reporting Person With ------------------------------------------------------------------------------------------------------ 8. Shared Voting Power 13,605,944 ------------------------------------------------------------------------------------------------------ 9. Sole Dispositive Power 2,166,979 ------------------------------------------------------------------------------------------------------ 10. Shared Dispositive Power 13,605,944 - -------------------------------------------------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each 15,772,923 Reporting Person - -------------------------------------------------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) |_| - -------------------------------------------------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 19.7% - -------------------------------------------------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) CO/HC - -------------------------------------------------------------------------------------------------------------------------- Page 2 of 16 Page 3 of 16 CUSIP No. 86688Q100 - -------------------------------------------------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only). 4322525 Canada Inc. - -------------------------------------------------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) ______ (b) ______ - -------------------------------------------------------------------------------------------------------------------------- 3. SEC Use Only - -------------------------------------------------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - -------------------------------------------------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [_] - -------------------------------------------------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Canada - -------------------------------------------------------------------------------------------------------------------------- 7. Sole Voting Power 13,605,944 Number of Shares Beneficially Owned by Each Reporting Person With ------------------------------------------------------------------------------------------------------ 8. Shared Voting Power ------------------------------------------------------------------------------------------------------ 9. Sole Dispositive Power 13,605,944 ------------------------------------------------------------------------------------------------------ 10. Shared Dispositive Power - -------------------------------------------------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each 13,605,944 Reporting Person - -------------------------------------------------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) |_| - -------------------------------------------------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 17.0% - -------------------------------------------------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) CO/HC - --------------------------------------------------------------------------------------------------------------------------
Page 3 of 16 This Schedule 13D (this "Statement") is filed by the undersigned and relates to the Class A Common Stock, par value $.01 per share, of Sun-Times Media Group, Inc. (formerly Hollinger International Inc.) (the "Issuer"). Hollinger (as defined below) previously filed a Schedule 13D with the U.S. Securities and Exchange Commission ("Commission") on October 23, 1995, as amended by Amendment No. 1 thereto filed on February 9, 1996, Amendment No. 2 thereto filed on March 8, 1996, Amendment No. 3 thereto filed on June 17, 1996, Amendment No. 4 thereto filed on August 28, 1996, Amendment No. 5 thereto filed on August 11, 1997, Amendment No. 6 thereto filed on June 12, 1998, Amendment No. 7 thereto filed on October 13, 1998, Amendment No. 8 thereto filed on October 22, 1998, Amendment No. 9 thereto filed on March 4, 1999, Amendment No. 10 thereto filed on June 15, 1999, Amendment No. 11 thereto filed on November 19, 1999, Amendment No. 12 thereto filed on March 22, 2001, Amendment No. 13 thereto filed on July 31, 2001, Amendment No. 14 thereto filed on August 19, 2002, Amendment No. 15 thereto filed on January 18, 2004, Amendment No. 16 thereto filed on March 3, 2004, Amendment No. 17 thereto filed on June 24, 2004, Amendment No. 18 thereto filed on June 29, 2004 and Amendment No. 19 thereto filed on July 7, 2004. Such Schedule 13D and amendments thereto (collectively, the "Joint Filing") were jointly filed by Hollinger, Conrad M. Black, The Lord Black of Crossharbour, P.C. (CAN), O.C., K.C.S.G. ("Mr. Black") and The Ravelston Corporation Limited ("Ravelston") (collectively, the "Joint Filers") and, as described in Item 6 of this Statement, Hollinger has determined to no longer file jointly with the other Joint Filers. Although the Joint Filers no longer file jointly, this Statement should be read in connection with the Joint Filing, and Item 3 hereof is based upon Item 3 of the Joint Filing. ITEM 1. SECURITY AND ISSUER. The class of equity securities to which this Statement relates are shares of Class A Common Stock, par value $.01 per share, of the Issuer ("Class A Common Stock"). The principal executive offices of the Issuer are located at 350 North Orleans, Chicago, Illinois 60654. ITEM 2. IDENTITY AND BACKGROUND. This Statement is being filed by Hollinger Inc. ("Hollinger") and 4322525 Canada Inc., an indirect wholly-owned subsidiary of Hollinger ("Canada Co", and together with Hollinger, the "Reporting Persons"). Each of Hollinger and Canada Co is a corporation incorporated under the laws of Canada and each such corporation is a holding company whose principal asset is its equity interest in the Issuer, a newspaper publisher whose assets include the Chicago Sun-Times, a large number of community papers in the Chicago area and a portfolio of new media investments. The principal business address for each Reporting Person is 10 Toronto Street, Toronto, Ontario, Canada M5C 2B7. The name, residence or business address, present principal occupation or employment (including the name, principal business and address of any corporation or other organization in which such employment is conducted) and citizenship of each director and executive officer of the Reporting Persons are listed on Schedule I hereto (the "Schedule I Persons"). Page 4 of 16 During the last five years, none of the Reporting Persons nor, to the best of their knowledge, any of their officers and directors listed on Schedule I, has (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. Hollinger and Canada Co acquired beneficial ownership of the Issuer's securities pursuant to the following transactions with the Issuer: (i) 14,990,000 shares of the Issuer's Class B Common Stock, par value $.01 per share ("Class B Common Stock"), acquired by Hollinger in May 1994 in connection with a recapitalization effected by the Issuer concurrently with the initial public offering of Class A Common Stock; (ii) 33,610,754 shares of Class A Common Stock pursuant to the Share Exchange Agreement dated as of July 19, 1995 between Hollinger and the Issuer (the "1995 Share Exchange Agreement"); and (iii) 3,207,045 shares of Class A Common Stock pursuant to the UniMedia Class A Stock Purchase Agreement, dated as of April 18, 1997, among Hollinger, UniMedia Holding Company ("UniMedia") and the Issuer (the "UniMedia Class A Stock Purchase Agreement") and the UniMedia Class B Stock Purchase Agreement, dated as of April 18, 1997, among Hollinger, UniMedia and the Issuer (the "UniMedia Class B Stock Purchase Agreement"). The foregoing beneficial ownership totals give effect to certain exchange transactions with the Issuer that were completed in August 1997 pursuant to the Amended and Restated First Exchange Agreement, dated as of July 21, 1997, among Hollinger, UniMedia and the Issuer (the "Amended and Restated First Exchange Agreement") and the Second Amended and Restated Second Exchange Agreement, dated as of July 21, 1997, among Hollinger, UniMedia and the Issuer (the "Second Amended and Restated Second Exchange Agreement"). For information concerning the 1995 Share Exchange Agreement, the UniMedia Class A Stock Purchase Agreement, the UniMedia Class B Stock Purchase Agreement, the Amended and Restated First Exchange Agreement and the Second Amended and Restated Second Exchange Agreement, reference is hereby made to Exhibits 2, 3, 4, 5 and 6 hereto. For further information concerning the foregoing transactions, reference is hereby made to Item 3 of Schedule 13D (Amendment No. 5) filed with the Commission by Hollinger, Ravelston and Mr. Black on or about August 11, 1997. In September 1997, Hollinger undertook an internal reorganization which involved, among other things, transferring its holdings in the Issuer among different subsidiaries of Hollinger. As reported in Amendment No. 5 to Schedule 13D, as of August 11, 1997, Hollinger's holdings in the Issuer included securities held by its subsidiaries 3007017 Nova Scotia Limited ("Nova Scotia"), WMT Holding LLC, a Delaware limited liability company ("WMT") and UniMedia. On September 17, 1997, Nova Scotia and UniMedia were amalgamated and continued as UniMedia. On September 18, 1997, UniMedia transferred all of its holdings in securities of the Issuer to Canada Co (formerly known as 504468 N.B. Inc., a New Brunswick corporation), except for 2,000,000 shares of the Class B Page 5 of 16 Common Stock of the Issuer that were retained by UniMedia. On September 19, 1997, WMT wound up and transferred 15,950,000 shares of Class A Common Stock of the Issuer to UniMedia. On September 22, 1997, UniMedia transferred all of its holdings of securities of the Issuer to Hollinger and was dissolved. Giving effect to these transactions, Hollinger and Canada Co's beneficial ownership in the Issuer's securities are as set forth in Item 5 below. ITEM 4. PURPOSE OF TRANSACTION. The Reporting Persons beneficially own 782,923 shares of Class A Common Stock and 14,990,000 shares of Class B Common Stock, which represent, in the aggregate, approximately 70.1% of the combined voting power of all outstanding voting securities of the Issuer. The Reporting Persons are considering proposing changes to the Board of Directors of the Issuer (other than with respect to the Special Committee of the Board of Directors), including nominating one or more members to the Board of Directors of the Issuer and voting all of their shares of Class A Common Stock and Class B Common Stock in favor of such nominee or nominees. As of the date hereof, none of the current members of the Board of Directors of the Issuer were nominated by the Reporting Persons. On an on-going basis, the Reporting Persons expect to consider and evaluate the alternatives available with respect to their investment in the Issuer to enhance and maximize value for all shareholders and other stakeholders of Hollinger (which alternatives may include proposing changes to the Board of Directors of the Issuer (other than with respect to the Special Committee of the Board of Directors) and seeking representation on the Board of Directors of the Issuer). The Reporting Persons have in the past engaged, and may from time-to-time in the future engage, in discussions with the management and other representatives of the Issuer, as well as other shareholders of the Issuer, regarding the Issuer's business and operations, the Issuer's strategic plan and other matters. Other than as set forth herein, the Reporting Persons currently have no plans or proposals which relate to or would result in any of the actions enumerated in paragraphs (a) through (j) of Item 4 of the form of Schedule 13D promulgated under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"). However, each of the Reporting Persons reserves the right to change its plans or intentions at any time, as it deems appropriate, in light of its ongoing evaluation of (a) its business and liquidity objectives, (b) the Issuer's financial condition, business, operations, competitive position, prospects and/or share price, (c) industry, economic and/or securities markets conditions, (d) alternative investment opportunities, and (e) other relevant factors. To the Reporting Persons' knowledge, any of the Schedule I Persons may make the same evaluations and reserve the same rights. ITEM 5. INTERESTS IN THE SECURITIES OF THE PURCHASER. The Reporting Persons - --------------------- (a) The responses set forth on rows 11 through 13 of the cover pages of this Statement are incorporated herein by reference. The percentages set forth in such responses are based on 79,984,088 shares of Class A Common Stock as reported in the Issuer's quarterly report on Form 10-Q Page 6 of 16 filed with the Commission on November 11, 2006, and includes (i) 64,994,088 outstanding shares of Class A Common Stock and (ii) 14,990,000 shares of Class A Common Stock that may be acquired at any time by the conversion of 14,990,000 shares of Class B Common Stock. The aggregate amount of shares beneficially owned by Hollinger, as set forth on row 11 of the applicable cover page of this Statement, is comprised of the following: (i) 782,923 shares of Class A Common Stock, 166,979 of which are held by Hollinger and 615,944 of which are held by Canada Co; and (ii) 14,990,000 shares of Class A Common Stock that may be acquired at any time by the conversion of 14,990,000 shares of Class B Common Stock, 2,000,000 of which are held by Hollinger and 12,990,000 of which are held by Canada Co. Pursuant to Rule 13d-3 under the Exchange Act, Hollinger (by virtue of its relationship with Canada Co) may be deemed to share beneficial ownership of the shares of Class A Common Stock and the shares of Class B Common Stock owned by Canada Co. (b) The responses set forth (i) on rows 7 through 10 of the cover pages of this Statement and (ii) in Item 5(a) above are incorporated herein by reference. (c) None. (d) The responses set forth in Item 6 relating to the Indentures, the Security Agreement, the Security Agreement Amendment and the Second Priority Notes Security Agreement (each such term defined below) are incorporated herein by reference. (e) Not applicable. Page 7 of 16 Directors and Executive Officers of the Reporting Persons - --------------------------------------------------------- To the knowledge of the Reporting Persons, the following directors and executive officers of the Reporting Persons beneficially own shares of Class A Common Stock as follows: - ----------------------------------- -------------------------------------------- NAME NUMBER OF SHARES OF CLASS A COMMON STOCK BENEFICIALLY OWNED - ----------------------------------- -------------------------------------------- Stanley M. Beck, Q.C. 3,525.67 - ----------------------------------- -------------------------------------------- Newton G. Z. Glassman 585(1) - ----------------------------------- -------------------------------------------- - ------------------------- (1) These 585 shares of Class A Common Stock are beneficially owned by Catalyst Fund General Partner I Inc., a private equity fund managed by Catalyst Capital Group Inc., in respect of which Mr. Glassman is the Managing Partner. Page 8 of 16 ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. The Issuer's Restated Certificate of Incorporation, as amended, provides that holders of shares of Class B Common Stock are entitled to ten votes per share and holders of shares of Class A Common Stock are entitled to one vote per share. The holders of shares of Class A Common Stock and shares of Class B Common Stock vote together as a single class on all matters on which stockholders may vote, except when class voting is required by applicable law or on a vote to issue or increase the authorized number of shares of Class B Common Stock. Dividends must be paid on both the shares of Class A Common Stock and the shares of Class B Common Stock at any time dividends are paid on either. Each share of Class B Common Stock is convertible at any time at the option of the holder into one share of Class A Common Stock and is transferable by the Reporting Persons to a subsidiary or an affiliate. In addition, each share of Class B Common Stock is automatically converted into a share of Class A Common Stock at the time it is sold, transferred or otherwise disposed of by the Reporting Persons or a subsequent permitted transferee to any third party (other than a subsidiary or an affiliate of the Reporting Persons or such subsequent permitted transferee) unless such purchaser or transferee offers to purchase all the shares of Class A Common Stock from the holders thereof for an amount per share equal to the amount per share received by the holder of shares of Class B Common Stock (a "Permitted Transaction"). Notwithstanding the foregoing paragraph, any holder of shares of Class B Common Stock may pledge such holder's shares of Class B Common Stock to a pledgee pursuant to a bona fide pledge of such shares as collateral security for indebtedness due to the pledgee, provided that such shares shall not be transferred to or registered in the name of the pledgee and shall remain subject to the transfer restrictions described in the foregoing paragraph. In the event that shares of Class B Common Stock are so pledged, the pledged shares shall not be converted automatically into shares of Class A Common Stock. However, if any such pledged shares become subject to any foreclosure, realization or other similar action of the pledgee, they shall be converted automatically into shares of Class A Common Stock unless they are sold in a Permitted Transaction. Hollinger's Articles of Amalgamation dated September 17, 1985, as amended, provide that the holders of Retractable Common Shares of Hollinger (the "Retractable Common Shares") may cause Hollinger to exchange such shares at any time upon demand, subject to certain exceptions, for a number of shares of Class A Common Stock held both directly and indirectly by Hollinger determined pursuant to a formula or cash, at Hollinger's option. The price for such shares (the "Retraction Price") is an amount determined by the Board of Directors of Hollinger (or committee thereof) on a quarterly basis within a range of not less than 90% and not more than 100% of the Current Value (as defined below) on the relevant date divided by the number of Retractable Common Shares outstanding on such date. For these purposes, "Current Value" is defined by reference to the fair market value of all of the assets of Hollinger, less amounts payable upon liquidation to holders of Hollinger's preference shares and certain tax liabilities, all as determined by the Board of Directors of Hollinger. Hollinger has previously stated that employing this range will allow fluctuating market conditions to be taken into account in setting the Retraction Price. Upon receipt of a retraction notice, Hollinger will retract the appropriate number of Page 9 of 16 Retractable Common Shares by sending to the holder a stock certificate representing that number of shares of Class A Common Stock equal to the applicable Retraction Price divided by the Current Class A Market Price (as defined below) on the retraction date. For these purposes, the "Current Class A Market Price" will be determined primarily by reference to the per share closing price of the Class A Common Stock on the New York Stock Exchange, with such price being converted into the Canadian dollar equivalent. If Hollinger elects to satisfy the Retraction Price in cash, it may do so for all or any part of the shares to be retracted. Hollinger is obligated to satisfy certain conditions with respect to shares of Class A Common Stock delivered as a redemption of Retractable Common Shares, including the effectiveness of a registration statement under the Securities Act of 1933, as amended, with respect to such shares or the availability of an exemption from such registration, and the listing of such shares on each stock exchange on which shares of Class A Common Stock is listed. The Series II Preference Shares of Hollinger (the "Series II Preference Shares") are "mirror shares", each of which tracks a number of shares of Class A Common Stock of the Issuer equal to the "Exchange Number". The Exchange Number is subject to adjustment upon the occurrence of certain events, and is currently equal to 0.46. Each Series II Preference Share entitles the holder to a dividend in an amount equal to the Canadian dollar equivalent of the amount of any dividend on the Exchange Number of shares of Class A Common Stock of the Issuer less any U.S. withholding tax thereon payable by Hollinger or any of its subsidiaries. A holder of Series II Preference Shares is entitled to require Hollinger to exchange such holder's Series II Preference Shares for a number of shares of Class A Common Stock for each such Series II Preference Share equal to (i) the Exchange Number plus (ii) the quotient obtained when the amount of declared and unpaid dividends on the Series II Preference Shares and declared dividends on shares of Class A Common Stock for which dividends have not been declared on the Series II Preference Shares is divided by the Canadian dollar equivalent of the current market price of the Exchange Number of shares of Class A Common Stock. On receipt of a retraction notice in respect of Series II Preference Shares, Hollinger is entitled to retract all or part of such Series II Preference Shares for a cash payment equal to the Canadian dollar equivalent of the current market price of the Exchange Number of shares of Class A Common Stock plus the amount of the declared and unpaid dividends on the Series II Preference Shares and declared dividends on shares of Class A Common Stock for which dividends have not been declared on the Series II Preference Shares. In the event of a liquidation, dissolution or winding up of Hollinger, the holders of Series II Preference Shares are entitled to (i) the Canadian dollar equivalent of the current market price of shares of Class A Common Stock (payable in shares of Class A Common Stock or cash, at the option of Hollinger) plus (ii) the amount of declared and unpaid dividends on the Series II Preference Shares and declared dividends on shares of Class A Common Stock for which dividends have not been declared on the Series II Preference Shares. Hollinger is currently prevented from honoring retractions of the Retractable Common Shares and the Series II Preference Shares as a consequence of it being in default under the terms of the Indentures (as defined below). As of November 30, 2006, there were retraction notices from holders of 153,846 Retractable Common Shares at a retraction price of $9.00 per share and 211 Retractable Common Shares at a retraction price of $7.25 per share, which Hollinger is unable to complete at the present time. On June 11, 2004, Hollinger caused certain shares (the "Escrowed Shares") of Class A Common Stock to be deposited into escrow with Computershare Trust Company of Canada (the "Share Escrow Agent"). The shares of Class A Common Page 10 of 16 Stock reported in Item 5 of this Statement comprise Escrowed Shares and will be released by the Share Escrow Agent from time to time in order to satisfy retraction requests from the holders of all of the issued and outstanding Series II Preference Shares. Pursuant to the Security Agreement (the "Security Agreement"), dated as of March 10, 2003, as amended on September 30, 2004 (the "Security Agreement Amendment"), among Hollinger, RMI (as defined below), Canada Co and Wachovia Trust Company, National Association ("Wachovia"), the Reporting Persons granted to Wachovia a first priority lien on the shares of Class B Common Stock reported in Item 5 of this Statement. The Security Agreement was executed pursuant to the Indenture, dated as of March 10, 2003, as supplemented on September 30, 2004, among Hollinger, RMI, Canada Co, Ravelston, Sugra Limited and Wachovia (the "First Indenture"). Pursuant to the Second Priority Notes Security Agreement (the "Second Priority Notes Security Agreement"), dated as of September 30, 2004, among Hollinger, RMI, Canada Co and HSBC Bank USA, National Association ("HSBC"), the Reporting Persons granted to HSBC a second priority security interest on the shares of Class B Common Stock reported in Item 5 of this Statement. The Second Priority Notes Security Agreement was executed pursuant to the Indenture, dated as of September 30, 2004, among Hollinger, RMI, Canada Co, Ravelston, Sugra Limited and HSBC (together with the First Indenture, the "Indentures"). On January 16, 2004, the Issuer consented (the "Consent") to the entry of a Partial Final Judgment and Order of Permanent Injunction against the Issuer in an action brought by the Commission in the U.S. District Court for the Northern District of Illinois (the "Order"). The Consent and Order provide, among other things, for the appointment of Richard C. Breeden ("Breeden") as Special Monitor of the Issuer in each of the following events (i) the nomination or election to the Board of Directors of any individual without the support of at least 80% of incumbent members of the Board of Directors of the Issuer, (ii) the removal of any of the directors of the Issuer prior to the end of their term, (iii) the removal of any members of the Special Committee of the Issuer as a member of the Board of Directors of the Issuer and (iv) the removal by the Board of Directors of the Issuer of any of the members of the Special Committee as a member of the Special Committee. The Special Monitor's mandate, among other matters, is to protect the interests of the Company's non-controlling stockholders to the extent permitted by law. On January 24, 2006, at the Issuer's 2005 Annual Meeting of Stockholders, Hollinger nominated two of its directors to serve as directors of the Company. As a result of Hollinger's 70.1% voting interest, the two nominees were elected to the Issuer's Board of Directors. Since these nominees were not endorsed in accordance with the Order, Breeden became Special Monitor of the Company. These nominees resigned from the Issuer's Board of Directors on July 13, 2006. Hollinger has determined to no longer file jointly with the other Joint Filers as a result of the following: (a) the resignation of Mr. Black as Chairman, Chief Executive Officer and a director of Hollinger on November 2, 2004, (b)(i) the placement of Ravelston and Ravelston Management, Inc. ("RMI"), a subsidiary of Ravelston, into receivership by an order of the Ontario Superior Page 11 of 16 Court of Justice (the "Court") pursuant to the Courts of Justice Act (Ontario) (the "Receivership Order"), (ii) the granting of protection to Ravelston and RMI of protection pursuant to the Companies' Creditors Arrangement Act (Canada) by a separate order (the "CCAA Order") and (iii) the appointment of RSM Richter Inc. ("RSM Richter") as receiver and monitor of all assets of Ravelston and RMI and certain affiliated entities and (c) the commencement of certain litigation among Hollinger, Mr. Black and the Ravelston Entities (as defined below). On May 18, 2005, the Court further ordered that the Receivership Order and the CCAA Order be extended to include Argus Corporation Limited and its five subsidiary companies which collectively own, directly or indirectly, 61.8% of the outstanding Retractable Common Shares and approximately 4% of the Series II Preference Shares (collectively, Argus Corporation Limited and its five subsidiary companies, as well as Ravelston and RMI are referred to as the "Ravelston Entities"). On June 12, 2006, the Court appointed RSM Richter as receiver and manager and interim receiver of all the property, assets and undertaking of Argent News Inc., a wholly owned subsidiary of Ravelston. The Ravelston Entities own, in aggregate, approximately 78% of the outstanding Retractable Common Shares and approximately 4% of the Series II Preference Shares. The Court has extended the stay of proceedings against the Ravelston Entities to June 8, 2007. Except for the agreements described in response to this Item 6, there are no contracts, arrangements, understandings or relationships (legal or otherwise) among the person named in Item 2 (as it relates to the Schedule I Persons, to the Reporting Persons' knowledge) and between such persons and any other person with respect to any of the securities of the Issuer, including, but not limited to, transfer or voting of any of the securities, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies. The foregoing descriptions of the Security Agreement, the Security Agreement Amendment, the Second Priority Notes Security Agreement, Consent and Order do not purport to be complete and are qualified in their entirety by reference to the full text of thereof, which are filed as Exhibit 7, 8, 9, 10 and 11 hereto, and are incorporated herein by reference. Page 12 of 16 ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. Exhibit No. Description ----------- ---------------------------------------------------------- 1. Joint Filing Agreement, dated as of February 13, 2007, between Hollinger Inc. and 4322525 Canada Inc. (filed herewith). 2. Share Exchange Agreement, dated as of July 19, 1995, between Hollinger Inc. and American Publishing Company (incorporated by reference to the definitive proxy statement of Sun-Times Media Group, Inc., dated September 28, 1995). 3. UniMedia Class A Stock Purchase Agreement, dated as of April 18, 1997, among Hollinger Inc., UniMedia Holding Company and Hollinger International Inc. (incorporated by reference to Exhibit 14 of Amendment No. 5 to the Schedule 13D filed by Hollinger Inc., The Ravelston Corporation Limited and Conrad M. Black on August 11, 1997). 4. UniMedia Class B Stock Purchase Agreement, dated as of April 18, 1997, among Hollinger Inc., UniMedia Holding Company and Hollinger International Inc. (incorporated by reference to Exhibit 15 of Amendment No. 5 to the Schedule 13D filed by Hollinger Inc., The Ravelston Corporation Limited and Conrad M. Black on August 11, 1997). 5. Amended and Restated First Exchange Agreement, dated as of July 21, 1997, among Hollinger Inc., UniMedia Holding Company and Hollinger International Inc. (incorporated by reference to Exhibit 16 of Amendment No. 5 to the Schedule 13D filed by Hollinger Inc., The Ravelston Corporation Limited and Conrad M. Black on August 11, 1997). 6. Second Amended and Restated Second Exchange Agreement, dated as of July 21, 1997, among Hollinger Inc., UniMedia Holding Company and Hollinger International Inc. (incorporated by reference to Exhibit 17 of Amendment No. 5 to the Schedule 13D filed by Hollinger Inc., The Ravelston Corporation Limited and Conrad M. Black on August 11, 1997). 7. Security Agreement, dated as of March 10, 2003, among Hollinger Inc., Ravelston Management Inc., 504468 N.B. Inc. and Wachovia Trust Company, National Association (incorporated by reference to Exhibit 99.33 of Amendment No. 15 to the Schedule 13D filed by Hollinger Inc., The Ravelston Corporation Limited and Conrad M. Black, The Lord Black of Crossharbour, P.C. (Can), O.C., K.C.S.G, on January 20, 2004). Page 13 of 16 Exhibit No. Description ----------- ---------------------------------------------------------- 8. First Amendment to Security Agreement, dated as of September 30, 2004, among Hollinger Inc., Ravelston Management Inc., 504468 N.B. Inc. and Wachovia Trust Company, National Association (filed herewith). 9. Second Priority Notes Security Agreement, dated as of September 30, 2004, among Hollinger Inc., Ravelston Management Inc., 504468 N.B. Inc. and HSBC Bank USA, National Association (filed herewith). 10. Consent of Defendant Hollinger International Inc., dated January 16, 2004 (incorporated by reference to Exhibit 99.3 of the Current Report On Form 8-K filed by Hollinger International Inc. on January 16, 2004). 11. Partial Final Judgment and Order of Permanent Injunction and Other Equitable Relief, dated January 16, 2004 (incorporated by reference to Exhibit 99.4 of the Current Report On Form 8-K filed by Hollinger International Inc. on January 16, 2004). 12. Power of Attorney, dated as of February 13, 2007, between Hollinger Inc. and G. Wesley Voorheis (filed herewith). 13. Power of Attorney, dated as of February 13, 2007, between 4322525 Canada Inc. and G. Wesley Voorheis (filed herewith). Page 14 of 16 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: February 14, 2007 HOLLINGER INC. By: /s/ G. Wesley Voorheis --------------------------------- Name: G. Wesley Voorheis Title: Authorized Representative Page 15 of 16 SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: February 14, 2007 4322525 CANADA INC. By: /s/ G. Wesley Voorheis --------------------------------- Name: G. Wesley Voorheis Title: Authorized Representative Page 16 of 16 SCHEDULE I DIRECTORS AND EXECUTIVE OFFICERS OF THE REPORTING PERSONS The (i) name, (ii) title, (iii) country of citizenship, (iv) principal occupation or employment (including the name and principal business of any corporation or other organization in which such employment is conducted) and (v) principal business address of each of the directors and executive officers of Hollinger are listed below: DIRECTORS (i) Randall C. Benson (ii) Director, Chief Restructuring Officer (iii) Canada (iv) Chief Restructuring Officer, Hollinger Inc. (v) 10 Toronto Street, Toronto, Ontario, Canada M5C 2B7 (i) Newton G. Z. Glassman (ii) Director (iii) Canada (iv) Managing Partner, Catalyst Capital Group Inc. (v) 79 Wellington Street West, Maritime Life Tower, TD Centre, Suite 3475, Toronto, Ontario, Canada M5K 1J3 (i) Stanley M. Beck, Q.C. (ii) Director (iii) Canada (iv) President, Granville Arbitrations Limited (v) Suite 500, 70 Bond Street, Toronto, Ontario, Canada M5B 1X3 (i) David A. Rattee (ii) Director (iii) Canada (iv) Chairman, President and Chief Executive Officer, CIGL Holdings Ltd. (v) Suite 1000, 33 Yonge Street, Toronto, Ontario, Canada M5E 159 (i) David W. Drinkwater (ii) Director (iii) Canada (iv) Chief Legal Officer, Nortel Networks Corporation (v) 195 The West Mall, Toronto, Ontario, Canada M9C 5K1 (i) Patrick W. E. Hodgson (ii) Director (iii) Canada (iv) President, Cinnamon Investments Ltd. (v) 60 Bedford Road, 2nd Floor, Toronto, Ontario, Canada M5R 2K2 (i) G. Wesley Voorheis (ii) Director (iii) Canada (iv) Managing Director, VC & Co. Incorporated (v) Suite 908, 120 Adelaide Street West, Toronto, Ontario, Canada M5H 1T1 EXECUTIVE OFFICERS (i) Randall C. Benson (ii) Director, Chief Restructuring Officer (iii) Canada (iv) Chief Restructuring Officer, Hollinger Inc. (v) 10 Toronto Street, Toronto, Ontario, Canada M5C 2B7 (i) Ronald B. Mitchell (ii) Acting Chief Financial Officer (iii) Canada (iv) Acting Chief Financial Officer, Hollinger Inc. (v) 10 Toronto Street, Toronto, Ontario, Canada M5C 2B7 The (i) name, (ii) title, (iii) country of citizenship, (iv) principal occupation or employment (including the name and principal business of any corporation or other organization in which such employment is conducted) and (v) principal business address of each of the directors and executive officers of Canada Co are listed below: DIRECTORS (i) Randall C. Benson (ii) Director, President, Secretary (iii) Canada (iv) Chief Restructuring Officer, Hollinger Inc. (v) 10 Toronto Street, Toronto, Ontario, Canada M5C 2B7 (i) G. Wesley Voorheis (ii) Director, Chairman (iii) Canada (iv) Managing Director, VC & Co. Incorporated (v) Suite 908, 120 Adelaide Street West, Toronto, Ontario, Canada M5H 1T1 (i) Stanley M. Beck, Q.C. (ii) Director (iii) Canada (iv) President, Granville Arbitrations Limited (v) Suite 500, 70 Bond Street, Toronto, Ontario, Canada M5B 1X3 (i) David A. Rattee (ii) Director (iii) Canada (iv) Chairman, President and Chief Executive Officer, CIGL Holdings Ltd. (v) Suite 1000, 33 Yonge Street, Toronto, Ontario, Canada M5E 159 EXECUTIVE OFFICERS (i) Randall C. Benson (ii) Director, President, Secretary (iii) Canada (iv) Chief Restructuring Officer, Hollinger Inc. (v) 10 Toronto Street, Toronto, Ontario, Canada M5C 2B7 EX-99 2 mv2-14ex_1.txt EXHIBIT 1 EXHIBIT 1 JOINT FILING AGREEMENT The undersigned acknowledge and agree that the foregoing Schedule 13D is filed on behalf of each of the undersigned and that all subsequent amendments to this Statement on Schedule 13D may be filed on behalf of each of the undersigned without the necessity of filing additional joint filing agreements. Dated: February 13, 2007 HOLLINGER INC. By: /s/ G. Wesley Voorheis ------------------------------------------ Name: G. Wesley Voorheis Title: Director 4322525 CANADA INC. By: /s/ G. Wesley Voorheis ------------------------------------------ Name: G. Wesley Voorheis Title: Chairman EX-99 3 mv2-14ex_8.txt EXHIBIT 8 EXHIBIT 8 FIRST AMENDMENT TO SECURITY AGREEMENT Dated as of September 30, 2004 Among The Grantors referred to herein as Grantors ----------- and WACHOVIA TRUST COMPANY, NATIONAL ASSOCIATION as Trustee and Collateral Agent, -------------------------------- and the other Secured Parties referred to herein FIRST AMENDMENT TO SECURITY AGREEMENT First Amendment to Security Agreement dated as of September 30, 2004 (this "FIRST AMENDMENT TO SECURITY Agreement") made by HOLLINGER INC., a Canadian corporation (the "COMPANY"), RAVELSTON MANAGEMENT INC., an Ontario corporation ("RMI"), and 504468 N.B. INC., a New Brunswick corporation ("NBI"), and the Additional Grantors (as such term is defined in Section 19 of the Security Agreement dated March 10, 2003 (the "SECURITY AGREEMENT") among the Company, RMI, NBI and the Additional Grantors) (the Company, RMI, NBI, and the Additional Grantors being, collectively, the "GRANTORS"), to WACHOVIA TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee and as Collateral Agent under the Indenture (as hereinafter defined) (in such capacity, together with any successor appointed pursuant to the Indenture, the "COLLATERAL AGENT") for itself, each of the Holders (as defined in the Indenture), and each other secured party specified in any of the other Note Documents (as hereinafter defined) (collectively, the "SECURED PARTIES"), being an amendment to the Security Agreement. PRELIMINARY STATEMENTS (1) The Company, as issuer, and RMI and NBI, as guarantors, entered into an Indenture dated as of March 10, 2003 (said indenture, as it may be amended, amended and restated, supplemented or otherwise modified from time to time, being the "INDENTURE") with The Ravelston Corporation Limited, Sugra Limited and the Collateral Agent. (2) The Grantors entered into the Security Agreement in order to grant to the Collateral Agent for the ratable benefit of itself and the other Secured Parties a security interest in the Collateral (as defined in the Security Agreement). (3) The Company, as issuer, and RMI and NBI, as guarantors, have entered into a First Supplemental Indenture (the "SUPPLEMENTAL INDENTURE") dated as of the date hereof with The Ravelston Corporation Limited, Sugra Limited and the Collateral Agent in order to amend the Indenture to permit, among other things, the issuance of New Notes (as defined in the Supplemental Indenture) pursuant to the New Notes Indenture (as defined in the Supplemental Indenture). (4) It is desired to amend certain provisions of the Security Agreement to reflect the terms of the Supplemental Indenture. (5) The Company intends to issue up to $15,000,000 in aggregate principal amount of New Notes to be secured by a second priority security interest in the Senior Notes Collateral pursuant to a security agreement dated the date hereof among the Grantors and HSBC Bank USA, National Association, as trustee and as collateral agent under the New Notes Indenture (the "NEW NOTES COLLATERAL AGENT") and an intercreditor agreement dated the date hereof among the Company, Trustee, the Collateral Agent, the trustee for the New Notes and the New Notes Collateral Agent. (6) For all purposes of this First Amendment to Security Agreement, except as otherwise stated herein, capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Security Agreement or in the Note Documents (as defined in the Security Agreement), as the case may be. NOW THEREFORE, in consideration of the premises and in order to implement the terms of the Supplemental Indenture, each Grantor agrees with the Collateral Agent and the other Secured Parties that the Security Agreement will be hereby amended as follows: Section 1. Amendment of Section 10 of the Security Agreement. The third sentence of Section 10(a) of the Security Agreement is hereby amended and restated by deleting that sentence in its entirety and replacing it with the following: "Except for the security agreement dated as of September 30, 2004 (said agreement, as it may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time, being the "NEW NOTES SECURITY AGREEMENT") among the Grantors and HSBC Bank USA, National Association, as trustee and as collateral agent under the New Notes Indenture, no Grantor will become bound by a security agreement authenticated by another Person which by its terms may pertain to the Collateral (including, without limitation, a security agreement authenticated as provided in Section 9-203(d) of the UCC) without giving the Collateral Agent 30 days prior written notice thereof and taking all action required by the Collateral Agent to ensure that the perfection and first priority nature of the Collateral Agent's security interest in the Collateral will be maintained." Section 2. Amendments of Section 13 of the Security Agreement. (a) Subsection 13(a)(ii) of the Security Agreement is hereby amended and restated by deleting that subsection in its entirety and replacing it with the following: "(ii) create or suffer to exist any Lien upon or with respect to any of the Collateral of such Grantor except for: (A) the pledge, assignment and security interest created under this Agreement and (B) the pledge, assignment and security interest created under the New Notes Security Agreement." (b) Section 13 of the Security Agreement is hereby amended to add a new Section 13(c) at the end thereof as follows: "(c) The Collateral Agent is authorized to hold the Collateral as agent for the benefit of the secured parties under the New Notes Security Agreement, including the Second Priority Notes Collateral Agent (as defined in the New Notes Security Agreement) (collectively, the "SECOND PRIORITY SECURED 2 PARTIES"), to the extent of such secured parties' interest in the Collateral as provided in, and otherwise subject to the terms and conditions of, the New Notes Security Agreement and the New Notes Intercreditor Agreement, provided that the Collateral Agent shall not be required to take any action with respect to the Collateral or any proceeds thereof in favor of the Second Priority Secured Parties unless expressly provided in the New Notes Intercreditor Agreement or an instruction properly given pursuant thereto. Section 3. Amendment of Section 17 of the Security Agreement. The last sentence of Section 17(b) of the Security Agreement is hereby amended and restated by deleting that sentence in its entirety and replacing it with the following: Any surplus of such cash or cash proceeds held by or on the behalf of the Collateral Agent and remaining after payment in full of all the Secured Obligations shall be paid over to the Second Priority Notes Collateral Agent, if such turnover is required by the applicable provisions of the New Notes Intercreditor Agreement, and if not so required, to the applicable Grantor or to whomsoever may be lawfully entitled to receive such surplus. Section 4. Amendment of Schedule III to the Security Agreement. Schedule III to the Security Agreement is hereby amended and restated by deleting that Schedule in its entirety and replacing it with Schedule A annexed hereto. Section 5. Miscellaneous. (a) Effectiveness. Upon the execution hereof, the amendments to the Security Agreement set forth herein shall become effective, the Security Agreement shall be modified in accordance therewith and this First Amendment to Security Agreement shall form part of the Security Agreement for all purposes. (b) GOVERNING LAW. THIS FIRST AMENDMENT TO SECURITY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF). (c) Counterparts. This First Amendment to Security Agreement may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this First Amendment to Security Agreement by telecopier shall be effective as delivery of an original executed counterpart of this First Amendment to Security Agreement. (d) Successors and Assigns. All covenants and agreements in this First Amendment to Security Agreement by the Company or any other Grantor shall bind its successors and assigns, whether so expressed or not. 3 (e) Conflicts. In the event of a conflict between the terms and conditions of the Security Agreement and the terms and conditions of this First Amendment to Security Agreement, the terms and conditions of this First Amendment to Security Agreement shall prevail. (f) Headings. The Section and Subsection headings in this First Amendment to Security Agreement are for convenience only and shall not affect the construction hereof. (g) Separability Clause. In case any provision in this First Amendment to Security Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in anyway be affected or impaired thereby. (h) Benefits of First Amendment to Security Agreement. Nothing in this First Amendment to Security Agreement, express or implied, shall give to any Person (other than the parties hereto, their successors hereunder and the Holders) any benefit or any legal or equitable right, remedy or claim under this First Amendment to Security Agreement. (i) The Trustee and the Collateral Agent. The recitals herein shall be taken as statements of the Grantors and neither the Trustee nor the Collateral Agent shall assume any responsibility for their correctness. Neither the Trustee nor the Collateral Agent make any representations as to the validity or sufficiency of this First Amendment to Security Agreement. 4 IN WITNESS WHEREOF, each of parties hereto and the Collateral Agent have caused this First Amendment to Security Agreement to be duly executed, all as of the day and year first written above. HOLLINGER INC. By: /s/ Peter G. White --------------------------------------------- Title: Co-COO RAVELSTON MANAGEMENT INC. By: /s/ Peter G. White --------------------------------------------- Title: Executive VP 504468 N.B. INC. By: /s/ Peter G. White --------------------------------------------- Title: Executive VP WACHOVIA TRUST COMPANY, NATIONAL ASSOCIATION, not in its individual capacity, but solely as Trustee and as Collateral Agent under the Indenture By: /s/ Steven A. Finklea --------------------------------------------- Title: CCTS Vice President 5 SCHEDULE A TO THE FIRST AMENDMENT TO SECURITY AGREEMENT ASSIGNMENTS AGREEMENTS GRANTOR ASSIGNED AGREEMENT - ------- ------------------ RMI Services Agreement between Hollinger International Inc. and The Ravelston Corporation Limited, dated as of January 1, 1998 as assigned by The Ravelston Corporation Limited to Ravelston Management Inc. pursuant to a Transfer and Consent Agreement dated July 5, 2002 (as amended, amended and restated, or otherwise modified or supplemented from time to time). (Agreement has been terminated). RMI Amended and Restated Services Agreement between Hollinger Canadian Publishing Holdings Co. and The Ravelston Corporation Limited, dated as of December 1, 1999 as assigned by The Ravelston Corporation Limited to Ravelston Management Inc. pursuant to a Transfer and Consent Agreement dated July 5, 2002 (as amended, amended and restated, or otherwise modified or supplemented from time to time). (Agreement has been terminated). HI Support Agreement between Hollinger Inc. and Ravelston Management Inc. dated as of March 10, 2003 (as amended, amended and restated, or otherwise modified or supplemented from time to time). EX-99 4 mv2-14ex_9.txt EXHIBIT 9 EXHIBIT 9 SECOND PRIORITY NOTES SECURITY AGREEMENT Dated as of September 30, 2004 From The Grantors referred to herein as Grantors ----------- to HSBC BANK USA, NATIONAL ASSOCIATION as Trustee and Collateral Agent, -------------------------------- and the other Second Priority Secured Parties referred to herein TABLE OF CONTENTS
SECTION PAGE Section 1. Grant of Security.....................................................................3 Section 2. Security for Obligations..............................................................3 Section 3. Grantors Remain Liable................................................................3 Section 4. Delivery and Control of Security Collateral...........................................4 Section 5. Maintaining the Account Collateral....................................................6 Section 6. Investing of Amounts in the Collateral Accounts.......................................7 Section 7. Maintaining Electronic Chattel Paper and Transferable Records.........................8 Section 8. Representations and Warranties........................................................8 Section 9. Further Assurances...................................................................10 Section 10. Post-Closing Changes; Bailees; Collections on Support Agreement; Receivables and Related Contracts................................................................12 Section 11. Voting Rights; Dividends; Etc........................................................13 Section 12. As to the Support Agreement..........................................................15 Section 13. Transfers and Other Liens; Additional Shares.........................................16 Section 14. Second Priority Notes Collateral Agent Appointed Attorney-in-Fact....................16 Section 15. Second Priority Notes Collateral Agent May Perform...................................17 Section 16. The Second Priority Notes Collateral Agent's Duties..................................17 Section 17. Remedies.............................................................................18 Section 18. Indemnity and Expenses...............................................................22 Section 19. Amendments; Waivers; Additional Grantors; Etc........................................23 Section 20. Notices, Etc.........................................................................23 Section 21. Continuing Security Interest.........................................................24 Section 22. Release of Collateral; Termination...................................................24 Section 23. Security Interest Absolute...........................................................24 Section 24. Execution in Counterparts............................................................26 Section 25. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc...............................26
i Schedule I - Location, Chief Executive Office, Place Where Agreements Are Maintained, Type of Organization, Jurisdiction Of Organization And Organizational Identification Number Schedule II - Pledged Equity and Pledged Debt Schedule III - Assigned Agreement Schedule Schedule IV - Changes in Name, Location, Etc. Exhibits - -------- Exhibit A - Form of Security Agreement Supplement Exhibit B - Form of Account Control Agreement Exhibit C - Form of Consent and Agreement of RMI ii SECOND PRIORITY NOTES SECURITY AGREEMENT SECOND PRIORITY NOTES SECURITY AGREEMENT dated as of September 30, 2004 made by HOLLINGER INC., a Canadian corporation (the "COMPANY"), RAVELSTON MANAGEMENT INC., an Ontario corporation ("RMI"), and 504468 N.B. INC., a New Brunswick corporation ("NBI"), and the Additional Grantors (as defined in Section 19) (the Company, RMI, NBI, and the Additional Grantors being, collectively, the "GRANTORS"), to HSBC BANK USA, NATIONAL ASSOCIATION, as Trustee and Collateral Agent under the Second Priority Notes Indenture (as hereinafter defined) (in such capacity, together with any successor appointed pursuant to the Second Priority Notes Indenture, the "SECOND PRIORITY NOTES COLLATERAL AGENT") for itself, each of the Holders (as defined in the Second Priority Notes Indenture), and each other secured party specified in any of the other Second Priority Note Documents (as hereinafter defined) (collectively, the "SECOND PRIORITY SECURED PARTIES"). Terms used herein but not otherwise defined herein shall have the meanings ascribed thereto in the Second Priority Notes Indenture (as defined herein). PRELIMINARY STATEMENTS (1) The Company, as issuer, and RMI and NBI, as guarantors, entered into an indenture dated as of March 10, 2003 (said indenture, as it may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time, being the "FIRST PRIORITY NOTES Indenture") with The Ravelston Corporation Limited, Sugra Limited and Wachovia Trust Company, National Association (the "FIRST PRIORITY NOTES COLLATERAL AGENT"). (2) Pursuant to the First Priority Notes Indenture, the Grantors entered into a security agreement, dated as of March 10, 2003 (said security agreement, as it may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time, being the "FIRST PRIORITY NOTES SECURITY AGREEMENT"), in order to grant to the First Priority Notes Collateral Agent for the ratable benefit of itself and the other First Priority Secured Parties (as defined in the intercreditor agreement, dated as of the date hereof, between the First Priority Notes Collateral Agent, the Second Priority Notes Collateral Agent and the Company (the "FIRST PRIORITY NOTES INTERCREDITOR AGREEMENT")) a first priority security interest in the Collateral (as defined in the First Priority Notes Security Agreement). (3) The Company, as issuer, and RMI and NBI, as guarantors, have entered into an indenture dated as of September 30, 2004 (said indenture, as it may hereafter be amended, amended and restated, supplemented or otherwise modified from time to time, being the "SECOND PRIORITY NOTES INDENTURE") with The Ravelston Corporation Limited, Sugra Limited and the Second Priority Notes Collateral Agent. (4) The Grantors are entering into this Agreement in order to grant to the Second Priority Notes Collateral Agent for the ratable benefit of itself and the other Second Priority Secured Parties (as defined in the First Priority Notes Intercreditor Agreement) a second priority security interest in the Collateral. (5) Each of the Company and NBI is the owner of the shares of stock or other equity interests (the "INITIAL PLEDGED EQUITY") set forth on and described in Schedule II hereto and issued by the Persons named therein. (6) The Company is a party to the Support Agreement, between Hollinger Inc. and Ravelston Management Inc. dated as of March 10, 2003 (as amended, amended and restated, or otherwise modified or supplemented from time to time, the "SUPPORT AGREEMENT"). (7) RMI was a party to the Services Agreements (as defined in the First Priority Notes Indenture) (the Services Agreements and the Support Agreement hereinafter referred to as the "ASSIGNED AGREEMENTS"). (8) It is a condition precedent to the purchase of the Second Priority Notes by the Holders and the performance by the Second Priority Secured Parties of their respective obligations under this Agreement, the Second Priority Notes Indenture, the Second Priority Notes, the First Priority Notes Intercreditor Agreement, the other Security Documents or any other document or agreement related thereto or delivered in connection therewith (collectively, the "SECOND PRIORITY NOTE DOCUMENTS") that the Grantors shall have granted the second priority assignment and security interest and made the pledge and assignment contemplated by this Agreement. (9) Each Grantor will derive substantial direct and indirect benefit from the transactions contemplated by the Second Priority Note Documents. (10) Unless otherwise defined in this Agreement or the other Second Priority Note Documents, terms defined in Article 8 or 9 of the UCC (as defined below) and/or in the Federal Book Entry Regulations (as defined below) are used in this Agreement as such terms are defined in such Article 8 or 9 and/or the Federal Book Entry Regulations. "UCC" means the Uniform Commercial Code as in effect, from time to time, in the State of New York; provided that, if perfection or the effect of perfection or non-perfection or the priority of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, "UCC"` means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority. The term "FEDERAL BOOK ENTRY REGULATIONS" means (a) the federal regulations contained in Subpart B ("TREASURY/RESERVE AUTOMATED DEBT ENTRY SYSTEM (TRADES)") governing book-entry securities consisting of U.S. Treasury bonds, notes and bills and Subpart D ("ADDITIONAL PROVISIONS") of 31 C.F.R. Part 357, 31 C.F.R. ss. 357.2, ss. 357.10 through ss. 357.14 and ss. 357.41 through ss. 357.44 and (b) to the extent substantially identical to, the federal regulations referred to in clause (a) above (as in effect from time to time), the federal regulations governing other book-entry securities. The term "PPSA(ON)" shall mean the Personal Property 2 Security Act (Ontario) (or any successor statute} and the term "PPSA(NB)" shall mean the Personal Property Security Act (New Brunswick) (or any successor statute). NOW, THEREFORE, in consideration of the premises and in order to induce the Holders to purchase the Second Priority Notes, and each Second Priority Secured Party to perform their respective obligations under the Second Priority Note Documents, each Grantor hereby agrees with the Second Priority Notes Collateral Agent and the other Second Priority Secured Parties as follows: Section 1. Grant of Security. Each Grantor hereby grants, assigns and transfers to the Second Priority Notes Collateral Agent and the other Second Priority Secured Parties, a security interest in, such Grantor's right, title and interest in and to the Collateral (as defined in the First Priority Notes Security Agreement). Notwithstanding anything to the contrary contained in this Agreement, the security interest granted pursuant to this Agreement (including pursuant to this Section 1), shall be a "second" priority security interest in the Collateral, fully junior, subordinated and subject to the security interest granted pursuant to the First Priority Notes Security Agreement to the holders of notes issued under the First Priority Notes Indenture, and all other rights and benefits afforded hereunder to the Second Priority Secured Parties are expressly subject to the terms and conditions of the Second Priority Note Documents. Section 2. Security for Obligations. This Agreement secures, in the case of each Grantor, the payment of all obligations of such Grantor now or hereafter existing under the Second Priority Note Documents, whether direct or indirect, absolute or contingent, and whether for principal, reimbursement obligations, interest, fees, premiums, penalties, indemnifications, contract causes of action, costs, expenses or otherwise (all such obligations being the "SECURED OBLIGATIONS"). Without limiting the generality of the foregoing, this Agreement secures, as to each Grantor, the payment of all amounts that constitute part of the Secured Obligations and would be owed by such Grantor, whether incurred alone or with another or others and whether as principal, guarantor or surety, to any Second Priority Secured Party under the Second Priority Note Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving a Grantor. Section 3. Grantors Remain Liable. Anything herein to the contrary notwithstanding, (a) each Grantor shall remain liable under the contracts and agreements included in such Grantor's Collateral to the extent set forth therein to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (b) the exercise by the Second Priority Notes Collateral Agent or any other Second Priority Secured Party of any of the rights hereunder shall not release any Grantor from any of its duties or obligations under the contracts and agreements included in the Collateral and (c) neither the Second Priority Notes Collateral Agent nor any other Second Priority Secured Party shall have any obligation or liability under the contracts and agreements included in the Collateral by reason of this Agreement or any other Second Priority Note Documents, nor shall the Second Priority Notes Collateral Agent or any other Second Priority Secured Party be obligated to perform any of the obligations or duties of any Grantor thereunder 3 or to take any action to collect or enforce any claim for payment assigned hereunder. Furthermore, the Second Priority Notes Collateral Agent shall not be liable or accountable for any failure to seize, collect, realize, dispose of, enforce or otherwise deal with the Collateral, shall not be bound to institute proceedings for any such purposes or for the purpose of preserving any rights of the Second Priority Notes Collateral Agent, the Grantor or any other person, firm or corporation in respect of the Collateral and shall not be liable or responsible for any loss, cost or damage whatsoever which may arise in respect of any such failure including, without limitation, resulting from the negligence of the Second Priority Notes Collateral Agent or any of its officers, servants, agents, solicitors, attorneys, Receivers (as hereinafter defined) or otherwise. Neither the Second Priority Notes Collateral Agent nor its officers, servants, agents or Receivers shall be liable by reason of any entry into possession of the Collateral or any part thereof, to account as a mortgagee in possession, for anything except actual receipts, for any loss on realization, for any act or omission for which a mortgagee in possession might be liable for any loss, cost, damage or expense whatsoever which may arise in respect of any such actions, omissions or negligence. Section 4. Delivery and Control of Security Collateral. (a) Prior to any Collateral Transfer (as defined below), the Company's obligations with respect to delivery and control of the Collateral shall be solely to comply with the provisions of Section 4 of the First Priority Security Agreement. Pursuant to the First Priority Notes Intercreditor Agreement, in the event that (i) all of the Collateral is released from the Lien under the First Priority Notes Indenture, or (ii) the First Priority Notes Collateral Agent, acting on behalf of the First Priority Note Secured Parties (as defined in the First Priority Notes Intercreditor Agreement), has foreclosed or otherwise realized upon any or all of the Collateral, the First Priority Notes Collateral Agent is required to transfer and deliver to the Second Priority Notes Collateral Agent such portion of the Collateral remaining after satisfaction of all Secured Obligations (as defined in the First Priority Notes Indenture) then outstanding (the "TRANSFERRED COLLATERAL") and the making of such other payments as the First Priority Notes Collateral Agent is required to make pursuant to Section 14.05 of the First Priority Notes Indenture (such transfer and delivery, a "COLLATERAL TRANSFER"). The Second Priority Notes Collateral Agent shall thereafter have the right, at any time in its discretion and with notice to each Grantor, to transfer to or to register in the name of the Second Priority Notes Collateral Agent or any of its nominees any or all of the Security Collateral (as defined in the First Priority Security Agreement) included in the Transferred Collateral, provided, however, that in, the case of Security Collateral included in the Transferred Collateral consisting of Class B Shares of Hollinger International Inc., such rights to register Security Collateral in the name of the Second Priority Notes Collateral Agent or any of its nominees shall only be exercised only after the occurrence and during the continuance of an Event of Default. In addition, the Second Priority Notes Collateral Agent shall have the right at any time 4 to exchange certificates or instruments representing or evidencing Security Collateral included in the Transferred Collateral for certificates or instruments of smaller or larger denominations. Also, the Second Priority Notes Collateral Agent shall have the right at any time to convert Security Collateral included in the Transferred Collateral consisting of financial assets credited to the Collateral Account (as defined in the First Priority Notes Security Agreement) to Security Collateral consisting of financial assets held directly by the Second Priority Notes Collateral Agent, and to convert Security Collateral included in the Transferred Collateral consisting of financial assets held directly by the Second Priority Notes Collateral Agent, to Security Collateral consisting of financial assets credited to the Collateral Accounts. (b) From and after a Collateral Transfer, with respect to any Security Collateral included in the Transferred Collateral in which any Grantor has any right, title or interest and that constitutes an uncertificated security, such Grantor will cause the issuer thereof either (i) to register the Second Priority Notes Collateral Agent as the registered owner of such security or (ii) to agree in an authenticated record with such Grantor and the Second Priority Notes Collateral Agent that such issuer will comply with instructions with respect to such security originated by the Second Priority Notes Collateral Agent without further consent of such Grantor, such authenticated record to be in form and substance satisfactory to the Second Priority Notes Collateral Agent. From and after a Collateral Transfer, with respect to any Security Collateral included in the Collateral, other than any Class B Shares of Hollinger International Inc., in which any Grantor has any right, title or interest and that is not an uncertificated security, upon the request of the Second Priority Notes Collateral Agent, such Grantor will notify each such issuer of Pledged Equity (as defined in the First Priority Notes Security Agreement) that such Pledged Equity is subject to the second priority security interest granted hereunder. (c) From and after a Collateral Transfer, with respect to any Security Collateral included in the Transferred Collateral, in which any Grantor has any right, title or interest and that constitutes a security entitlement in which the Second Priority Notes Collateral Agent is not the entitlement holder, such Grantor will cause the securities intermediary with respect to such security entitlement either (i) to identify in its records the Second Priority Notes Collateral Agent as the entitlement holder of such security entitlement against such securities intermediary or (ii) to agree in an authenticated record with such Grantor and the Second Priority Notes Collateral Agent that such securities intermediary will comply with entitlement orders (that is, notifications communicated to such securities intermediary directing transfer or redemption of the financial asset to which such Grantor has a security entitlement) originated by the Second Priority Notes Collateral Agent without further consent of such Grantor, such authenticated record to be in substantially the form of Exhibit B hereto or otherwise in form and substance satisfactory to the Second Priority Notes Collateral Agent (such agreement being an "ACCOUNT CONTROL AGREEMENT"). 5 (d) From and after a Collateral Transfer, no Grantor will change or add any securities intermediary that maintains any securities account in which any of the Transferred Collateral, other than any Class B Shares of Hollinger International Inc., is credited or carried, or change or add any such securities account, in each case without first complying with the above provisions of this Section 4 in order to perfect the second priority security interest granted hereunder in such Transferred Collateral. (e) Not later than 10 business days after any Collateral Transfer, each Grantor with respect to Security Collateral included in the Transferred Collateral shall (i) take and complete any and all action necessary in order to ensure that all beneficial and registered ownership interests in each item of such Security Collateral are held by a single or two Grantors; (ii) provide the Second Priority Notes Collateral Agent and/or any other Secured Party requesting the same with evidence satisfactory to the Second Priority Notes Collateral Agent and/or such other Secured Party that all such action described in clause (i) above has been taken; and (iii) deliver to or in accordance with the instructions of the Second Priority Notes Collateral Agent original stock certificates and stock powers originally executed in blank, all in form and substance satisfactory to the Second Priority Notes Collateral Agent, reflecting any changes in ownership with respect to any Security Collateral included in the Transferred Collateral resulting from the actions described in clause (i) above. Section 5. Maintaining the Account Collateral. So long as any Secured Obligations remain outstanding: (a) Each Grantor will maintain all Account Collateral only with (i) prior to a Collateral Transfer, (A) the First Priority Notes Collateral Agent or (B) in accordance with the First Priority Notes Indenture or the First Priority Notes Security Agreement, or (ii) after a Collateral Transfer, (A) the Second Priority Notes Collateral Agent or (B) banks (the "PLEDGED ACCOUNT BANKS") that have agreed, in an Account Control Agreement authenticated by the Grantor, the Second Priority Notes Collateral Agent and the Pledged Account Banks, to (x) comply with instructions originated by the Second Priority Notes Collateral Agent directing the disposition of funds in the Account Collateral without the further consent of the Grantor and (y) waive or subordinate in favor of the Second Priority Notes Collateral Agent all claims of the Pledged Account Banks (including, without limitation, claims by way of a security interest, lien or right of setoff or right of recoupment) to the Account Collateral, which authenticated record shall be substantially in the form of Exhibit B hereto, or shall otherwise be in form and substance satisfactory to the Second Priority Notes Collateral Agent. (b) Each Grantor agrees that it will not terminate any bank as a Pledged Account Bank that, (i) at any time, has entered into an Account Control Agreement with the First Priority Notes Collateral Agent with respect to the Collateral or terminate any Account Collateral included in the Collateral or (ii) after a Collateral 6 Transfer, has entered into an Account Control Agreement with the Second Priority Notes Collateral Agent with respect to the Transferred Collateral or terminate any Account Collateral included in the Transferred Collateral. (c) After any Collateral Transfer, the Second Priority Notes Collateral Agent shall have sole right to direct the disposition of funds with respect to the Collateral Accounts included in the Transferred Collateral, and it shall be a term and condition of the Collateral Accounts included in the Transferred Collateral, notwithstanding any term or condition to the contrary in any other agreement relating to the Collateral Accounts, that no amount (including, without limitation, interest on Cash Equivalents (as defined in the First Priority Notes Security Agreement) credited thereto) will be paid or released to or for the account of, or withdrawn by or for the account of, any Grantor or any other Person from the Collateral Accounts included in the Transferred Collateral. (d) After any Collateral Transfer, the Second Priority Notes Collateral Agent may, at any time and without notice to, or consent from, the Grantor, transfer, or direct the transfer of, funds from the Account Collateral included in the Transferred Collateral to satisfy the Grantor's obligations under the Second Priority Note Documents if an Event of Default shall have occurred and be continuing. Section 6. Investing of Amounts in the Collateral Accounts. From and after any Collateral Transfer: (a) The Second Priority Notes Collateral Agent will, subject to the provisions of Sections 5, 17 and 22, from time to time, at the direction of the Company, (a) invest, or direct the applicable Pledged Account Bank to invest, amounts received with respect to the Collateral Accounts included in the Transferred Collateral in such Cash Equivalents credited to (A) the Collateral Accounts included in the Transferred Collateral or (B) in the case of Cash Equivalents consisting of Securities Collateral included in the Transferred Collateral, a securities account in which the Second Priority Notes Collateral Agent is the securities intermediary or a securities account subject to an Account Control Agreement, and (b) invest interest paid on the Cash Equivalents referred to in clause (a) above, and reinvest other proceeds of any such Cash Equivalents that may mature or be sold, in each case in such Cash Equivalents credited in the same manner. (b) Interest and proceeds that are not invested or reinvested in Cash Equivalents as provided above shall be deposited and held in the Collateral Accounts included in the Transferred Collateral; and the Second Priority Notes Collateral Agent and other Second Priority Secured Parties shall not be liable for any losses resulting from such investments. 7 (c) In addition, the Second Priority Notes Collateral Agent shall have the right at any time to exchange, or direct the applicable Pledged Account Bank to exchange, such Cash Equivalents for similar Cash Equivalents of smaller or larger determinations, or for other Cash Equivalents, credited to the Collateral Accounts included in the Transferred Collateral. Section 7. Maintaining Electronic Chattel Paper and Transferable Records. From and after a Collateral Transfer, so long as any Secured Obligation of any Grantor under any Second Priority Note Documents shall remain unpaid, each Grantor will maintain all (i) electronic chattel paper included in the Transferred Collateral so that the Second Priority Notes Collateral Agent has control of the electronic chattel paper in the manner specified in Section 9-105 of the UCC or pursuant to similar laws in Canada, as applicable, and (ii) all transferable records included in the Transferred Collateral so that the Second Priority Notes Collateral Agent has control of the transferable records in the manner specified in Section 16 of the Uniform Electronic Transactions Act, as in effect in the jurisdiction governing such transferable record ("UETA") or pursuant to similar laws in Canada, as applicable. Section 8. Representations and Warranties. Each Grantor represents and warrants as follows: (a) Such Grantor's exact legal name, as defined in Section 9-503(a) of the UCC, and as evidenced pursuant to its Articles of Incorporation/ Amalgamation in the jurisdiction of incorporation, is correctly set forth in Schedule I hereto. Such Grantor has only the trade names listed on Schedule IV hereto. Such Grantor is located (within the meaning of Section 9-307 of the UCC) and has its chief executive office and the office in which it maintains the original copy of the Support Agreement to which such Grantor is a party and all originals of all chattel paper that evidence Receivables (as defined in the First Priority Notes Security Agreement) of such Grantor, in the state or provincial jurisdiction set forth in Schedule I hereto. The information set forth in Schedule I hereto with respect to such Grantor is true and accurate in all respects. Such Grantor has not, within five years prior to the date hereof, previously changed its name, location, chief executive office, place where it maintains its agreements, type of organization, jurisdiction of organization or organizational identification number from those set forth in Schedule I hereto except as disclosed in Schedule IV hereto. (b) All Security Collateral consisting of certificated securities and instruments have been delivered to the First Priority Notes Collateral Agent. Original or certified copies of each Assigned Agreement and all originals of all chattel paper that evidence Receivables have been delivered to the First Priority Notes Collateral Agent. None of the Receivables or Agreement Collateral (as defined in the First Priority Notes Security Agreement) is evidenced by a promissory note or other instrument that has not been delivered to the First Priority Notes Collateral Agent. 8 (c) Such Grantor is the legal and beneficial owner of the Collateral of such Grantor free and clear of any Lien, claim, option or right of others, except for the Liens of the First Priority Notes Indenture and the Second Priority Notes Indenture and the related first and second priority security interests created thereunder and pursuant to the First Priority Notes Security Agreement and this Agreement. No effective financing statement or other instrument similar in effect covering all or any part of such Collateral or listing such Grantor or any trade name of such Grantor as debtor is on file in any recording office, except such as may have been filed in favor of the Second Priority Notes Collateral Agent relating to the Second Priority Note Documents and except in connection with or pursuant to the First Priority Notes Indenture or the First Priority Notes Security Agreement. (d) The Pledged Equity pledged by such Grantor hereunder has been duly authorized and validly issued and is fully paid and non-assessable. With respect to the Pledged Equity that is an uncertificated security, such Grantor has caused the issuer thereof either (i) to register the First Priority Notes Collateral Agent as the registered owner of such security or (ii) to agree in an authenticated record with such Grantor and the First Priority Notes Collateral Agent that such issuer will comply with instructions with respect to such security originated by the First Priority Notes Collateral Agent without further consent of such Grantor. If such Grantor is an issuer of Pledged Equity, such Grantor confirms that it has received notice of such security interest. (e) The Initial Pledged Equity pledged by such Grantor constitutes the percentage of the issued and outstanding equity interests of the issuers thereof indicated on Schedule II hereto. (f) The Support Agreement, a true and complete copy of which has been furnished to the Second Priority Notes Collateral Agent, has been duly authorized, executed and delivered by all parties thereto, has not been amended, amended and restated, supplemented or otherwise modified, is in full force and effect and is binding upon and enforceable against all parties thereto in accordance with its terms. Each party to the Support Agreement listed on Schedule III hereto other than the Grantor has executed and delivered to such Grantor a consent, in substantially the form of Exhibit C hereto or otherwise in form and substance satisfactory to the Second Priority Notes Collateral Agent, to the assignment of the Agreement Collateral to the Second Priority Notes Collateral Agent pursuant to this Agreement. (g) All filings and other actions (including, without limitation, actions necessary to perfect the second priority security interest in the Collateral of such Grantor created under this Agreement) have been duly made or taken and are in full force and effect, and this Agreement creates in favor of the Second Priority Notes Collateral Agent for the benefit of itself and the other Second Priority Secured Parties a valid and, together with such filings and other actions, perfected second priority security interest in the 9 Collateral of such Grantor, securing the payment of the Secured Obligations. (h) No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or any other third party is required for (i) the grant by such Grantor of the second priority security interest granted hereunder or for the execution, delivery or performance of this Agreement by such Grantor, (ii) the perfection or maintenance of the second priority security interest created hereunder (including the second priority nature of such security interest), except for the filing of financing and continuation statements under the UCC, the PPSA(ON) and the PPSA(NB), which financing statements have been duly filed and are in full force and effect, and the actions described in Section 4 with respect to Security Collateral, which actions have been taken and are in full force and effect, or (iii) the exercise by the Second Priority Notes Collateral Agent of its rights provided for in this Agreement or the remedies in respect of the Collateral pursuant to this Agreement, except as may be required in connection with the disposition of any portion of the Security Collateral by laws affecting the offering and sale of securities generally. Section 9. Further Assurances. (a) Each Grantor agrees that, subject to the terms and conditions of the First Priority Notes Security Agreement, from time to time, at the expense of such Grantor, such Grantor will promptly execute and deliver, or otherwise authenticate, all, further instruments and documents, and take all further action that may be necessary or desirable, or that the Second Priority Notes Collateral Agent may request, in order to perfect and protect any pledge or second priority security interest granted or purported to be granted by such Grantor hereunder or to enable the Second Priority Notes Collateral Agent to exercise and enforce its rights and remedies hereunder with respect to any Collateral of such Grantor. Without limiting the generality of the foregoing, except to the extent prohibited by applicable law, the First Priority Notes Indenture or the First Priority Notes Security Agreement, each Grantor will promptly with respect to Collateral of such Grantor: (i) at the request of the Second Priority Notes Collateral Agent, mark conspicuously each chattel paper included in Receivables, the Support Agreement and, at the request of the Second Priority Notes Collateral Agent, each of its records pertaining to such Collateral with a legend, in form and substance satisfactory to the Second Priority Notes Collateral Agent, indicating that such chattel paper, Support Agreement or Collateral is subject to the second priority security interest granted hereby; (ii) execute or authenticate and file such financing, financing change or continuation statements, or amendments thereto, and such other instruments or notices, as may be necessary or desirable, or as the Second Priority Notes Collateral Agent may request, in order to perfect and preserve the second priority security interest granted or purported to be granted by such Grantor hereunder; (iii) take all action to ensure that the Second Priority Notes Collateral Agent's second priority security interest is noted on any certificate of ownership related to any Collateral evidenced by a certificate of ownership (other than the Class B Shares of Hollinger International Inc.); and (iv) deliver to the Second Priority Notes Collateral Agent evidence that all other action, except such actions in 10 each case that are prohibited by the First Priority Notes Indenture or the First Priority Notes Security Agreement, that may be reasonably necessary or desirable in order to perfect and protect the second priority security interest created by such Grantor under this Agreement has been taken. From time to time upon request by the Second Priority Notes Collateral Agent, each Grantor will, at such Grantor's expense, cause to be delivered to the Second Priority Notes Collateral Agent, for the benefit of the Second Priority Secured Parties, an Opinion of Independent Counsel, from outside counsel reasonably satisfactory to the Second Priority Notes Collateral Agent, as to such matters relating to the transactions contemplated hereby as the Second Priority Notes Collateral Agent may reasonably request. (b) Each Grantor hereby authorizes the Second Priority Notes Collateral Agent to file one or more financing, financing change or continuation statements, and amendments thereto, including, without limitation, one or more financing statements indicating that such financing statements cover all assets or all personal property (or words of similar effect) of such Grantor, in each case without the signature of such Grantor, and regardless of whether any particular asset described in such financing statements falls within the scope of the UCC, PPSA(ON) or PPSA(NB) or the granting clause of this Agreement. A photocopy or other reproduction of this Agreement or any financing statement covering the Collateral or any part thereof shall be sufficient as a financing statement where permitted by law. Each Grantor ratifies its authorization for the Second Priority Notes Collateral Agent to have filed such financing statements, continuation statements, financing change statements or amendments filed prior to the date hereof. In no event, however, will the Second Priority Notes Collateral Agent have any duty, responsibility or obligation to file any financing statement, continuation statement, financing change statement or amendment. (c) Each Grantor will furnish to the Second Priority Notes Collateral Agent from time to time statements and schedules further identifying and describing the Collateral of such Grantor and such other reports in connection with such Collateral as the Second Priority Notes Collateral Agent may reasonably request, all in reasonable detail. (d) The Company will furnish to the Second Priority Notes Collateral Agent, at any time upon the reasonable request of the Second Priority Notes Collateral Agent, an opinion of counsel, from outside counsel reasonably satisfactory to the Second Priority Notes Collateral Agent, to the effect that all financing, financing change or continuation statements have been filed, and all other action has been taken (including, without limitation, action necessary to (i) give the First Priority Notes Collateral Agent control over the Collateral as provided in Sections 9-104, 9-105, 9-106 and 9-107 of the UGC, in Section 16 of UETA, in the PPSA(ON) and in the PPSA(NB) and (ii) cause the second priority security interest in any Collateral evidenced by a certificate of ownership, other than the Class B Shares of Hollinger International Inc., to be noted on such certificate of ownership) to perfect continuously from the date hereof the second priority security interest granted hereunder. 11 Section 10. Post-Closing Changes; Bailees; Collections on Support Agreement; Receivables and Related Contracts. (a) Except to the extent required by the First Priority Notes Indenture or the First Priority Notes Security Agreement, no Grantor will change its name, type of organization, jurisdiction of organization, organizational identification number or location from those set forth in Section 5(a) of this Agreement without first giving at least 30 days' prior written notice to the Second Priority Notes Collateral Agent and taking all action required by the Second Priority Notes Collateral Agent for the purpose of perfecting or protecting the second priority security interest granted by this Agreement. Except to the extent required by the First Priority Notes Indenture or the First Priority Notes Security Agreement, no Grantor will change the place where it keeps the original of the Support Agreement and all originals of all chattel paper that evidence Receivables of such Grantor from the locations therefor specified in Sections 5(a) without first giving the Second Priority Notes Collateral Agent 30 days' prior written notice of such change. Except to the extent required by the First Priority Notes Indenture or the First Priority Notes Security Agreement, no Grantor will become bound by a security agreement authenticated by another Person which by its terms may pertain to the Collateral (including, without limitation, a security agreement authenticated as provided in Section 9-203(d) of the UCC) without giving the Second Priority Notes Collateral Agent 30 days' prior written notice thereof and taking all action required by the Second Priority Notes Collateral Agent to ensure that the perfection and second priority nature of the Second Priority Notes Collateral Agent's security interest in the Collateral will be maintained. Except to the extent required by the First Priority Notes Indenture or the First Priority Notes Security Agreement, each Grantor will hold and preserve its records relating to the Collateral, including, without limitation, the Support Agreement, and will permit representatives of the Second Priority Notes Collateral Agent at any time during normal business hours to inspect and make abstracts from such records and other documents. If the Grantor does not have an organizational identification number and later obtains one, it will forthwith notify the Second Priority Notes Collateral Agent of such organizational identification number. (b) If any Collateral of any Grantor is at any time in the possession or control of a warehouseman, bailee, processor or agent, other than the First Priority Notes Collateral Agent or its designee, or if the Second Priority Notes Collateral Agent so requests, such Grantor will (i) at any time, notify such warehouseman, bailee, processor or agent of the second priority security interest created hereunder and (ii) after a Collateral Transfer, (A) instruct such warehouseman, bailee, processor or agent to hold all, such Transferred Collateral solely for the Second Priority Notes Collateral Agent's account subject only to the Second Priority Notes Collateral Agent's instructions (which shall permit such Transferred Collateral to be removed by such Grantor in the ordinary course of business until the Second Priority Notes Collateral Agent notifies such warehouseman, bailee, processor or agent that an Event of Default has occurred and is continuing), (B) use best efforts, to cause such warehouseman, bailee, processor or agent to authenticate a record acknowledging that it holds possession of such Transferred Collateral for the Second Priority Notes Collateral Agent's benefit and shall act solely on the instructions of the Second Priority Notes Collateral Agent without the further 12 consent of the Grantor or any other Person, and (C) make such authenticated record available to the Second Priority Notes Collateral Agent. (c) Except as otherwise provided in this subsection (c), each Grantor will continue to collect, at its own expense, all amounts due or to become due such Grantor under the Support Agreement and Receivables. In connection with such collections, such Grantor may take (and, at the Second Priority Notes Collateral Agent's direction after the occurrence of a Collateral Transfer and an Event of Default which is continuing, will take) such action as such Grantor or, if applicable, the Second Priority Notes Collateral Agent, may deem necessary or advisable to enforce collection of the Support Agreement and Receivables; provided, however, that in the event that a Collateral Transfer has occurred and an Event of Default has occurred and is continuing and the Second Priority Notes Collateral Agent has given written notice thereof to the applicable Grantor(s) in respect thereof and to the obligors thereunder, the Second Priority Notes Collateral Agent shall have the right to make payment of 100% of all amounts payable under the Support Agreement directly to the Second Priority Notes Collateral Agent for so long as such Event of Default shall continue, and, upon any such notification and at the expense of such Grantor, to enforce collection of the Support Agreement and any such Receivables, to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done, and to otherwise exercise all rights with respect to the Support Agreement and such Receivables, including, without limitation, those set forth set forth in Section 9-607 of the UCC or pursuant to the PPSA(ON) or PPSA(NB). After receipt by any Grantor of the notice from the Second Priority Notes Collateral Agent referred to in the proviso to the preceding sentence, (i) all amounts and proceeds (including, without limitation, instruments) that may be received by such Grantor in respect of the Support Agreement and Receivables of such Grantor shall be received in trust for the benefit of the Second Priority Notes Collateral Agent hereunder, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Second Priority Notes Collateral Agent in the same form as so received (with any necessary indorsement) and for so long as the Event of Default giving rise to such notice be continuing, applied as provided in Section 17(b) and (ii) such Grantor will not adjust, settle or compromise the amount or payment of any Receivable or amount due on the Support Agreement, release wholly or partly any obligor thereof, or allow any credit or discount thereon. No Grantor will permit or consent to the subordination of its right to payment under the Support Agreement and any of the Receivables to any other indebtedness or obligations of the obligor thereof. Section 11. Voting Rights; Dividends; Etc. (a) Subject to the terms and conditions of the First Priority Notes Indenture, the First Priority Notes Security Agreement and the First Priority Notes Intercreditor Agreement, so long as no Event of Default shall have occurred and be continuing: (i) Each Grantor shall be entitled to exercise any and all voting and other consensual rights pertaining to the Security Collateral of such Grantor or any part thereof for any purpose; provided, however, that such Grantor will not exercise or refrain from exercising any such right with 13 respect to the Security Collateral included in the Transferred Collateral if such action would have a material adverse effect on the value of the Security Collateral included in the Transferred Collateral or any part thereof. (ii) Each Grantor shall be entitled to receive and retain any and all dividends, interest and other distributions paid in respect of the Security Collateral of such Grantor if and to the extent that the payment thereof is not otherwise prohibited by the terms of the Second Priority Note Documents; provided however, that any and all (A) dividends, interest and other distributions paid or payable other than in cash in respect of, and instruments and other property received, receivable or otherwise distributed in respect of, or in exchange for, any Security Collateral included in the Transferred Collateral, (B) dividends and other distributions paid or payable in cash in respect of any Security Collateral included in the Transferred Collateral in connection with partial or total liquidation or dissolution or in connection with a reduction of capital, capital surplus or paid-in-surplus, and (C) cash paid, payable or otherwise distributed in respect of principal of, or in redemption of, or in exchange for, any Security Collateral included in the Transferred Collateral shall be, and shall be forthwith delivered to the Second Priority Notes Collateral Agent to hold as, Security Collateral and shall, if received by such Grantor, be received in trust for the benefit of the Second Priority Notes Collateral Agent, be segregated from the other property or funds of such Grantor and be forthwith delivered to the Second Priority Notes Collateral Agent as Security Collateral in the same form as so received (with any necessary indorsement). (iii) The Second Priority Notes Collateral Agent will execute and deliver (or cause to be executed and delivered) to each Grantor all such proxies and other instruments as such Grantor may reasonably request for the purpose of enabling such Grantor to exercise the voting and other rights that it is entitled to exercise pursuant to paragraph (i) above and to receive the dividends or interest payments that it is authorized to receive and retain pursuant to paragraph (ii) above. (b) Upon the occurrence and during the continuance of an Event of Default, subject to the terms and conditions of the First Priority Notes Indenture, the First Priority Notes Security Agreement and the First Priority Notes Intercreditor Agreement, and after the occurrence of a Collateral Transfer: 14 (i) All rights of each Grantor (x) to exercise or refrain from exercising the voting and other consensual rights that it would otherwise be entitled to exercise pursuant to Section 11(a)(i) shall, upon notice to such Grantor by the Second Priority Notes Collateral Agent, cease and (y) to receive the dividends, interest and other distributions that it would otherwise be authorized to receive and retain pursuant to Section 11(a)(ii) shall automatically cease, and all such rights shall thereupon become vested in the Second Priority Notes Collateral Agent, which shall thereupon have the sole right to exercise or refrain from exercising such voting and other consensual rights and to receive and hold as Security Collateral such dividends, interest and other distributions. (ii) All dividends, interest and other distributions that are received by any Grantor contrary to the provisions of paragraph (i) of this Section 11(b) shall be received in trust for the benefit of the Second Priority Notes Collateral Agent, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Second Priority Notes Collateral Agent as Security Collateral in the same form as so received (with any necessary indorsement). Section 12. As to the Support Agreement. (a) The Company and RMI will at their respective expense, except to the extent prohibited under applicable law, the First Priority Notes Indenture or the First Priority Notes Security Agreement: (i) perform and observe all terms and provisions of the Support Agreement to be performed or observed by it, maintain the Support Agreement in full force and effect, enforce the Support Agreement in accordance with the terms thereof; and (ii) furnish to the Second Priority Notes Second Priority Notes Collateral Agent promptly upon receipt thereof copies of all notices, requests and other documents received by such Grantor, and notify the Second Priority Notes Collateral Agent immediately of any claims, litigation or default, under or pursuant to the Support Agreement, and from time to time furnish to the Second Priority Notes Collateral Agent such information and reports regarding the Support Agreement and such other Collateral of such Grantor as the Second Priority Notes Collateral Agent may reasonably request. (b) Each of the Company and RMI agrees that it will not, except to the extent otherwise permitted under the Second Priority Notes Indenture or as otherwise required by applicable law or pursuant to the First Priority Notes Indenture or the First Priority Notes Security Agreement: 15 (i) cancel or terminate the Support Agreement or consent to or accept any cancellation or termination (other than regularly scheduled termination by the terms of the Support Agreement) thereof; (ii) amend, amend and restate, supplement or otherwise modify the Support Agreement or give any consent, waiver (including, without limitation, any waiver of rights, privileges, remedies or powers) or approval thereunder (except for periodic renewals under identical terms); (iii) take any action to waive any default under or breach of any the Support Agreement; or (iv) take any other action in connection with the Support Agreement that would materially impair the value of the interests or rights of such Grantor thereunder or that would materially impair the interests or rights of the Second Priority Notes Collateral Agent or any other Second Priority Secured Party. Section 13. Transfers and Other Liens; Additional Shares. (a) Except pursuant to the First Priority Notes Indenture or the First Priority Notes Security Agreement, each Grantor agrees that it will not (i) sell, assign or otherwise dispose of, or grant any option with respect to, any of the Collateral, other than sales, assignments and other dispositions of Collateral, and options relating to Collateral, permitted under the terms of the Second Priority Notes indenture, or (ii) create or suffer to exist any Lien upon or with respect to any of the Collateral of such Grantor except for the pledge, assignment and second priority security interest created under this Agreement. (b) Each Grantor agrees that it will take any action within its power to (i) cause each issuer of the Pledged Equity pledged by such Grantor not to issue any equity interests or other securities in substitution for the Pledged Equity issued by such issuer, except to such Grantor, and (ii) pledge hereunder, immediately upon its acquisition (directly or indirectly) thereof, any and all additional equity interests or other securities representing Pledged Equity. Section 14. Second Priority Notes Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby irrevocably appoints the Second Priority Notes Collateral Agent such Grantor's attorney-in-fact, with full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, from time to time, in the Second Priority Notes Collateral Agent's discretion after the occurrence of an Event of Default which is continuing and after the occurrence of a Collateral Transfer, to take any action and to execute any instrument that may be necessary or advisable to accomplish the purposes of this Agreement, including, without limitation: (a) to ask for, demand, collect, sue for, recover, compromise, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Transferred Collateral, 16 (b) to receive, indorse and collect any drafts or other instruments, documents and chattel paper, in connection with clause (a) above, and (c) to file any claims or take any action or institute any proceedings that maybe necessary or desirable for the collection of any of the Transferred Collateral or otherwise to enforce compliance with the terms and conditions of the Support Agreement or the rights of the Second Priority Notes Collateral Agent with respect to any of the Transferred Collateral. Section 15. Second Priority Notes Collateral Agent May Perform. If any Grantor fails to perform any agreement contained herein, the Second Priority Notes Collateral Agent may, as is necessary to protect the second priority security interest granted hereunder in the Collateral or to protect the value thereof, but without any obligation to do so and without notice, itself perform, or cause performance of, such agreement, and the expenses of the Second Priority Notes Collateral Agent incurred in connection therewith shall be payable by such Grantor under Section 18; provided that the Second Priority Notes Collateral Agent shall not take any action that would cause the Company to violate any provision of the First Priority Notes Security Agreement, the First Priority Notes Indenture or the First Priority Notes Intercreditor Agreement. Section 16. The Second Priority Notes Collateral Agent's Duties. (a) The powers conferred on the Second Priority Notes Collateral Agent hereunder are solely to protect the Second Priority Secured Parties' interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except for the safe custody of any Transferred Collateral in its possession and the accounting for moneys actually received by it hereunder, the Second Priority Notes Collateral Agent shall have no duty as to any Collateral, as to ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Collateral, whether or not any Second Priority Secured Party has or is deemed to have knowledge of such matters, or as to the taking of any necessary steps to preserve rights against any parties or any other rights pertaining to any Collateral. The Second Priority Notes Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of any Transferred Collateral in its possession if such Transferred Collateral is accorded treatment substantially equal to that which it accords its own property. (b) Anything contained herein to the contrary notwithstanding, the Second Priority Notes Collateral Agent may from time to time, when the Second Priority Notes Collateral Agent deems it to be necessary, appoint one or more agents (each a "SUBAGENT") for the Second Priority Notes Collateral Agent hereunder with respect to all or any part of the Collateral. In the event that the Second Priority Notes Collateral Agent so appoints any Subagent with respect to any Collateral, (i) the assignment and pledge of such Collateral and the second priority security interest granted in such Collateral by each Grantor hereunder shall be deemed for purposes of this Second Priority Notes Security Agreement to have been made to such Subagent, in addition to the Second Priority Notes Collateral Agent, for the ratable benefit of the Second Priority Notes Collateral Agent and the other Second Priority Secured Parties, as security for the Secured Obligations of such Grantor, (ii) such Subagent shall automatically 17 be vested, in addition to the Second Priority Notes Collateral Agent, with all rights, powers, privileges, interests and remedies of the Second Priority Notes Collateral Agent hereunder with respect to such Collateral, and (iii) the term "Second Priority Notes Collateral Agent," when used herein in relation to any rights, powers, privileges, interests and remedies of the Second Priority Notes Collateral Agent with respect to such Collateral, shall include such Subagent; provided, however, that no such Subagent shall be authorized to take any action with respect to any such Collateral unless and except to the extent expressly authorized in writing by the Second Priority Notes Collateral Agent. Section 17. Remedies. If any Event of Default shall have occurred and be continuing: (a) The Second Priority Notes Collateral Agent may exercise in respect of the Transferred Collateral, in addition to other rights and remedies provided for herein or otherwise available to it, all the rights and remedies of a secured party upon default under the UCC, PPSA(ON) or PPSA(NB), as applicable (whether or not the UCC, PPSA(ON) or PPSA(NB), as applicable, apply to the affected Transferred Collateral), and also may: (i) require each Grantor to, and each Grantor hereby agrees that it will at its expense and upon request of the Second Priority Notes Collateral Agent forthwith, assemble all or part of the Transferred Collateral as directed by the Second Priority Notes Collateral Agent (to the extent such Transferred Collateral was not delivered to the Second Priority Notes Collateral Agent by the First Priority Notes Collateral Agent in connection with a Collateral Transfer) and make it available to the Second Priority Notes Collateral Agent at a place and time to be designated by the Second Priority Notes Collateral Agent that is reasonably convenient to both parties; (ii) without notice except as specified below, sell the Transferred Collateral or any part thereof in one or more parcels at public or private sale, at any of the Second Priority Notes Collateral Agent's offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Second Priority Notes Collateral Agent may deem commercially reasonable; (iii) occupy any premises owned or leased by any of the Grantors where the Transferred Collateral or any part thereof is assembled or located for a reasonable period in order to effectuate its rights and remedies hereunder or under law, without obligation to such Grantor in respect of such occupation; and (iv) exercise any and all rights and remedies of any of the Grantors under or in connection with the Transferred Collateral, or otherwise in respect of the Transferred Collateral, including, without limitation, (A) any and all rights of such Grantor to demand or otherwise require payment of any amount under, or performance of any provision of, the Support Agreement, the Receivables and the other Collateral, (B) withdraw, or cause or direct the withdrawal, of all funds with respect to the Account Collateral and (C) exercise all other rights and remedies with respect to the Support Agreement, the Receivables and the other Collateral, including, without limitation, those set forth in Section 9-607 of the UCC and those set forth in the PPSA(ON) and 18 PPSA(NB). Each Grantor agrees that, to the extent notice of sale shall be required by law, at least ten days' notice to such Grantor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Second Priority Notes Collateral Agent shall not be obligated to make any sale of Transferred Collateral regardless of notice of sale having been given. The Second Priority Notes Collateral Agent may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. No person dealing with the Second Priority Notes Collateral Agent or its servants or agents shall be concerned to inquire whether the security hereby constituted has become enforceable, whether the powers which the Second Priority Notes Collateral Agent is purporting to exercise have become exercisable, whether any money remains due on the security of the Collateral, as to the necessity or expedience of the stipulations and conditions subject to which any sale, lease or disposition shall be made, otherwise as to the propriety or regularity of any sate or any other dealing by the Second Priority Notes Collateral Agent with the Collateral or to see to the application of any money paid to the Second Priority Notes Collateral Agent. In the absence of fraud on the part of such persons, such dealings shall be deemed, so far as regards the safety and protection of such person, to be within the powers hereby conferred and to be valid and effective accordingly. (b) All cash proceeds received by or on behalf of the Second Priority Notes Collateral Agent in respect of any sale of, collection from, or other realization upon all or any part of the Transferred Collateral may be held by the Second Priority Notes Collateral Agent as collateral for, and/or then or at any time thereafter applied (after payment of any amounts payable to the Second Priority Notes Collateral Agent pursuant to Section 18) in whole or in part by the Second Priority Notes Collateral Agent for the ratable benefit of the Second Priority Secured Parties against, all or any part of the Secured Obligations, in the following manner: (i) first, paid to the Second Priority Notes Collateral Agent for any amounts then owing to the Second Priority Notes Collateral Agent under the Second Priority Note Documents; and (ii) second, ratably paid to the Holders and any other Second Priority Secured Parties, for any amounts then owing to them, in their capacities as such, under the Second Priority Note Documents ratably in accordance with such respective amounts then owing to such Second Priority Secured Parties. Any surplus of such cash or cash proceeds held by or on the behalf of the Second Priority Notes Collateral Agent and remaining after payment in full of all the Secured Obligations shall be paid over to the applicable Grantor or to whomsoever may be lawfully entitled to receive such surplus. 19 (c) From and after any Collateral Transfer, all payments received by any Grantor under or in connection with the Support Agreement or otherwise in respect of the Transferred Collateral shall be received in trust for the benefit of the Second Priority Notes Collateral Agent, shall be segregated from other funds of such Grantor and shall be forthwith paid over to the Second Priority Notes Collateral Agent in the same form as so received (with any necessary indorsement). (d) From and after any Collateral Transfer, the Second Priority Notes Collateral Agent may, without notice to any Grantor except as required by law and at any time or from time to time, charge, set-off and otherwise apply all or any part of the Secured Obligations against any funds held with respect to the Account Collateral included in the Transferred Collateral or in any other deposit account. (e) From and after a Collateral Transfer, if the Second Priority Notes Collateral Agent shall determine to exercise its right to sell all or any of the Security Collateral included in the Transferred Collateral of any Grantor pursuant to this Section 17, each Grantor agrees that, upon request of the Second Priority Notes Collateral Agent, such Grantor will, at its own expense, to the extent the Company then has the present ability to complete and have declared effect a registration statement under the United States securities laws: (i) execute and deliver, and cause each issuer of such Security Collateral contemplated to be sold and the directors and officers thereof to execute and deliver, all such instruments and documents, and do or cause to be done all such other acts and things, as may be necessary or advisable to register for resale such Security Collateral under the provisions of the Securities Act of 1933 (as amended from time to time, the "SECURITIES ACT"), to cause the registration statement relating thereto (the "COLLATERAL SHELF REGISTRATION STATEMENT") to become effective and to remain effective for such period as prospectuses are required by law to be furnished and in any event for so long as is necessary to enable the Holders to dispose of the Security Collateral in the manner of sale provided for in the registration statement and to make all amendments and supplements thereto and to the related prospectus that are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto; (ii) use its best efforts to qualify the Security Collateral under the state securities or "Blue Sky" laws and to obtain all necessary governmental approvals for the sale of such Security Collateral, as requested by the Second Priority Notes Collateral Agent or any other Second Priority Secured Party; 20 (iii) cause each such issuer of such Security Collateral to make available to its security holders, as soon as practicable, an earnings statement that will satisfy the provisions of Section 11(a) of the Securities Act; (iv) provide the Second Priority Notes Collateral Agent and each other Second Priority Secured Party with such other information and projections as may be necessary or advisable to enable the Second Priority Second Priority Notes Collateral Agent or any other Second Priority Secured Party to effect the sale of such Security Collateral; (v) take such other actions in furtherance of the resale of the Security Collateral pursuant to the Collateral Shelf Registration Statement as are comparable to those described in Section 5 (Registration Procedures) of the Registration Rights Agreement with respect to the Shelf Registration Statement (as defined therein) mutatis mutandis; and (vi) do or cause to be done all such other acts and things as may be necessary to make such sale of such Security Collateral or any part thereof valid and binding and in compliance with applicable law. (f) The Second Priority Notes Collateral Agent is authorized, in connection with any sale of the Security Collateral pursuant to this Section 17, to deliver or otherwise disclose to any prospective purchaser of the Security Collateral: (i) any registration statement or prospectus, and all supplements and amendments thereto, prepared pursuant to subsection (e)(i) above; (ii) any information and projections provided to it pursuant to subsection (e)(iv) above; and (iii) any other information in its possession relating to such Security Collateral. (g) Each Grantor acknowledges the impossibility of ascertaining the amount of damages that would be suffered by the Second Priority Secured Parties by reason of the failure by such Grantor to perform any of the covenants contained in subsection (e) above and, consequently, agrees that, if such Grantor shall fail to perform any of such covenants, it will pay, as liquidated damages and not as a penalty, an amount equal to the value of the Security Collateral on the date the Second Priority Collateral Agent shall demand compliance with subsection (e) above. (h) The Second Priority Notes Collateral Agent may, in addition to any other rights it may have, appoint by instrument in writing a receiver or receiver and manager (both of which are herein called a "RECEIVER") of all or any part of any Transferred Collateral or may institute proceedings in any court of competent jurisdiction for the appointment of such a Receiver. Any such Receiver is hereby given, and shall have the same powers and rights and exclusions and limitations of liability as the Second Priority Notes Collateral Agent 21 has under this Agreement, at law or in equity. In exercising any such powers, any such Receiver shall, to the extent permitted by law, act as and for all purposes shall be deemed to be the agent of the Grantor and the Second Priority Notes Collateral Agent shall not be responsible for any act or default of any such Receiver. The Second Priority Notes Collateral Agent may appoint one or more Receivers hereunder and may remove any such Receiver or Receivers and appoint another or others in his or their stead from time to time. Any Receiver so appointed may be an officer or employee of the Second Priority Notes Collateral Agent. A court need not appoint, ratify the appointment by the Second Priority Notes Collateral Agent of or otherwise supervise in any manner the actions of any Receiver. Upon a Grantor receiving notice from the Second Priority Notes Collateral Agent of the taking of possession of any Transferred Collateral or the appointment of a Receiver, all powers, functions, rights and privileges of each of the directors and officers of such Grantor with respect to any Transferred Collateral shall cease, unless specifically continued by the written consent of the Second Priority Notes Collateral Agent. Section 18. Indemnity and Expenses. (a) Each Grantor agrees to indemnify, defend and save and hold harmless each Second Priority Secured Party and each of their Affiliates and their respective officers, directors, employees, agents and advisors (each, an "INDEMNIFIED PARTY") from and against, and shall pay on demand, any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and expenses of counsel) that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of or in connection with or resulting from this Agreement (including, without limitation, enforcement of this Agreement), except to the extent such claim, damage, loss, liability or expense is found in a final judgment by a court of competent jurisdiction to have resulted from such Indemnified Party's gross negligence or willful misconduct. (b) Each Grantor will upon demand pay to the Second Priority Notes Collateral Agent the amount of any and all reasonable fees and expenses, including, without limitation, the reasonable fees and expenses of its counsel and of any experts and agents, that the Second Priority Notes Collateral Agent may incur in connection with (i) the administration of this Agreement, (ii) the custody, preservation, use or operation of, or the sale of, collection from or other realization upon, any Transferred Collateral, (iii) the exercise or enforcement of any of the rights of the Second Priority Notes Collateral Agent or the other Second Priority Secured Parties hereunder or (iv) the failure by such Grantor to perform or observe any of the provisions hereof. (c) In each case that the Second Priority Notes Collateral Agent may or is required hereunder to take any action, including without limitation to make any determination or judgment, to give consents, to exercise rights, powers or remedies or otherwise to act hereunder, the Second Priority Notes Collateral Agent may seek instruction from the Holders with respect to any such action of the Second Priority Notes Collateral Agent on which Holders are entitled to give instruction under the Second Priority Notes Indenture. The Second Priority Notes Collateral Agent shall not be liable with respect to any 22 action taken or omitted to be taken by it in good faith in accordance with such instruction from the Holders. Section 19. Amendments; Waivers; Additional Grantors; Etc. (a) No amendment or waiver of any provision of this Agreement, and no consent to any departure by any Grantor herefrom, shall in any event be effective unless the same shall be in writing and signed by the Second Priority Notes Collateral Agent, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. No failure on the part of the Second Priority Notes Collateral Agent or any other Second Priority Secured Party to exercise, and no delay in exercising any right hereunder, shall operate as a waiver thereof, nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. (b) Upon the execution and delivery, or authentication, by any Person of a second priority notes security agreement supplement in substantially the form of Exhibit A hereto (each a "SECOND PRIORITY NOTES SECURITY AGREEMENT SUPPLEMENT"), such Person shall be referred to as an "ADDITIONAL GRANTOR" and shall be and become a Grantor hereunder, and each reference in this Agreement and the other Second Priority Note Documents to "Grantor" shall also mean and be a reference to such Additional Grantor, and each reference in this Agreement and the other Second Priority Note Documents to "Collateral" and "Transferred Collateral" shall also mean and be a reference to the Collateral and/or Transferred Collateral of such Additional Grantor, and the supplemental Schedules I-III attached to each Second Priority Notes Security Agreement Supplement shall be incorporated into and become a part of and supplement Schedules I-III, respectively, hereto, and the Second Priority Notes Collateral Agent may attach such supplemental schedules to such Schedules; and each reference to such Schedules shall mean and be a reference to such Schedules as supplemented pursuant to each Second Priority Notes Security Agreement Supplement. Section 20. Notices, Etc. All notices and other communications provided for hereunder shall be in writing (including facsimile communication) and mailed or faxed in the case of the Second Priority Notes Collateral Agent, addressed to it at the Corporate Trust Office specified in the Second Priority Notes Indenture and, in the case of each Grantor, addressed to it at its address set forth opposite such Grantor's name on the signature pages hereto or on the signature page to the Second Priority Notes Security Agreement Supplement pursuant to which it became a party hereto; or, as to any party, at such other address as shall be designated by such party in a written notice to the other parties. All such notices and other communications shall, when mailed or faxed, be effective when deposited in the mails, faxed or otherwise delivered (or confirmed by a signed receipt), respectively, addressed as aforesaid; except that notices and other communications to the Second Priority Notes Collateral Agent shall not be effective until received by the Second Priority Notes Collateral Agent. Delivery by facsimile of an executed counterpart of any amendment or waiver of any provision of this Agreement or of any Second Priority Notes Security Agreement Supplement or Schedule hereto shall be effective as delivery of an original executed counterpart thereof. 23 Section 21. Continuing Security Interest. This Agreement shall create a continuing second priority security interest in the Collateral and shall (a) remain in full force and effect until the payment in full in cash of the Secured Obligations, (b) be binding upon each Grantor, its successors and assigns and (c) inure, together with the rights and remedies of the Second Priority Notes Collateral Agent hereunder, to the benefit of the Second Priority Secured Parties and their respective successors, transferees and assigns. Section 22. Release of Collateral; Termination. (a) From and after any Collateral Transfer, so long as no Default or Event of Default shall have occurred and be continuing, the Second Priority Notes Collateral Agent will release to the Company or at its order (or, at the request of the Company, to the Second Priority Notes Collateral Agent to be applied to the Secured Obligations of the Company under the Second Priority Note Documents), the Transferred Collateral to the extent permitted to be released under the terms of the Second Priority Note Documents and will, at such Grantor's expense, execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence the release of any Collateral from the second priority security interest granted hereby to the extent permitted to be released under the terms of the Second Priority Note Documents; provided, however, that (i) at the time of such request and such release no Default shall have occurred and be continuing, (ii) all conditions required to be satisfied under the Second Priority Notes Indenture shall have been complied with, and (iii) the Grantor shall have delivered to the Second Priority Notes Collateral Agent a form of release for execution by the Second Priority Notes Collateral Agent and a certificate of such Grantor to the effect that the transaction is in compliance with the Second Priority Note Documents and as to such other matters as the Second Priority Notes Collateral Agent may request. (b) Upon the payment in full in cash of the Secured Obligations, the pledge and second priority security interest granted hereby shall terminate and all rights to the Collateral shall revert to the applicable Grantor, except as otherwise provided in the First Priority Notes Indenture or the First Priority Notes Security Agreement. Upon any such termination, the Second Priority Notes Collateral Agent will, at the applicable Grantor's expense, execute and deliver to such Grantor such documents as such Grantor shall reasonably request to evidence such termination. Section 23. Security Interest Absolute. The obligations of each Grantor under this Agreement are independent of the Secured Obligations or any other obligations of any Grantor, or any Affiliate of any Grantor under or in respect of the Second Priority Note Documents, and a separate action or actions may be brought and prosecuted against each Grantor to enforce this Agreement, irrespective of whether any action is brought against such Grantor or any other Affiliate of any Grantor or whether such Grantor or any other Affiliate of any Grantor is joined in any such action or actions. All rights of the Second Priority Notes Collateral Agent and the other Second Priority Secured Parties and the pledge, assignment and second priority security interest hereunder, and all obligations of each Grantor hereunder, shall be irrevocable, absolute and unconditional irrespective of, and each Grantor hereby irrevocably waives (to the maximum extent permitted by applicable law) any defenses it may 24 now have or may hereafter acquire in any way relating to, any or all of the following: (a) any lack of validity or enforceability of any Second Priority Note Document or any other agreement or instrument relating thereto; (b) any change in the time, manner or place of payment of, or in any other term of, all or any of the Secured Obligations or any other obligations of any other Affiliate of a Grantor under or in respect of the Second Priority Note Documents or any other amendment or waiver of or any consent to any departure from any Note Document, including, without limitation, any increase in the Secured Obligations to any Grantor or any of its Affiliates or otherwise; (c) any taking, exchange, release or non-perfection of any Transferred Collateral or any other collateral, or any taking, release or amendment or waiver of or consent to departure from any guaranty, for all or any of the Secured Obligations; (d) any manner of application of any Transferred Collateral or any other collateral, or proceeds thereof, to all or, any of the Secured Obligations, or any mariner of sale or other disposition of any Transferred Collateral or any other collateral for all or any of the Secured Obligations or any other obligations of any other Affiliate of any Grantor under or in respect of the Note Documents or any other assets of any Affiliate of any Grantor; (e) any change, restructuring or termination of the corporate structure or existence of any Grantor, or any Affiliate of any Grantor; (f) any failure of any Second Priority Secured Party to disclose to any Grantor or any Affiliate of any Grantor any information relating to the business, condition (financial or otherwise), operations, performance, assets, nature of assets, liabilities or prospects of any other Grantor or Affiliate of any Grantor now or hereafter known to such Second Priority Secured Party (each Grantor waiving any duty on the part of the Second Priority Secured Parties to disclose such information); (g) the failure of any other Person to execute this Agreement or any other Second Priority Note Document, guaranty or agreement or the release or reduction of liability of any Grantor or other grantor or surety with respect to the Secured Obligations; or (h) any other circumstance (including, without limitation, any statute of limitations) or any existence of or reliance on any representation by any Second Priority Secured Party that might otherwise constitute a defense available to, or a discharge of, such Grantor or any other Grantor or a third party grantor of a security interest. 25 This Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Secured Obligations is rescinded or must otherwise be returned by any Second Priority Secured Party or by any other Person upon the insolvency, bankruptcy or reorganization of any Grantor or any Affiliate of any Grantor or otherwise, all as though such payment had not been made. Section 24. Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile shall be effective as delivery of an original executed counterpart of this Agreement. Section 25. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a) This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. (b) Each Grantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any of the other Second Priority Note Documents to which it is or is to be a party, or for recognition or enforcement of any judgment, and each Grantor hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in any such New York State court or, to the extent permitted by taw, in such federal court. Each Grantor agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Second Priority Note Document shall affect any right that any party may otherwise have to bring any action or proceeding relating to this Agreement or any other Second Priority Note Document in the courts of any jurisdiction. (c) Each Grantor irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any of the other Second Priority Note Documents to which it is or is to be a party in any New York State or federal court. Each Grantor hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such suit, action or proceeding in any such court. (d) Each Grantor represents, warrants and agrees that, within 30 days after the date hereof, it will have appointed Corporation Service Company as its authorized agent (the "AUTHORIZED AGENT," which terra, as used herein, includes any successor in such capacity) upon whom process may be served in any such action, suit or proceeding arising out of, based on or relating to this Agreement or any of the transactions contemplated hereby. Such appointment shall, to the fullest extent it may effectively do so under applicable law, be 26 irrevocable. Each Grantor represents, warrants and agrees that, prior to the Closing Date, the Authorized Agent will have agreed to act as such agent for service of process and such Grantor agrees, to the fullest extent it may effectively do so under applicable law, to take any and all action, including the filing of any and all documents and instruments and the payment of all fees, that may be necessary to effect and to continue such appointment in full force and effect as aforesaid for so long as any of the Secured Obligations shall be outstanding and until the principal of, premium, if any and interest on, and any and all other amounts payable under or with respect to the Secured Obligations shall have been, paid in full. Each Grantor agrees, to the fullest extent it may effectively do so under applicable law, that service of process upon the Authorized Agent and written notice for such service to such Grantor (mailed or delivered to its Secretary at the Address shown next to its name on the signature page of this Agreement) shall be deemed, in every respect, effective service of process upon such Grantor in any such action, suit or proceeding. (e) In respect of any judgment or order given or made against a Grantor for any amount due hereunder that is expressed and paid in a currency (the "JUDGMENT CURRENCY") other than United States dollars, such Grantor will indemnify the Second Priority Notes Collateral Agent and each other Second Priority Secured Party, from and against any and all loss incurred by such Secured Party as a result of any variation as between (i) the rate of exchange at which the United States dollar amount is converted into the judgment currency for the purpose of such judgment or order and (ii) the rate of exchange at which such Secured Party is able to purchase United States dollars with the amount of judgment currency actually received by such Secured Party. Each Grantor agrees, to the fullest extent it may effectively do so under applicable law, that the foregoing indemnity shall constitute a separate and independent obligation of such Grantor and shall continue in full force and effect notwithstanding any such judgment or order as aforesaid. The term "rate of exchange" shall include any premiums and costs of exchange payable in connection with the purchase of or conversion into United States dollars. (f) To the extent that a Grantor or any of its properties, assets or revenues may have or may hereafter become entitled to, or have attributed to it, any right of immunity, on the grounds of sovereignty or otherwise, from (i) any legal action, suit or proceeding, (ii) setoff or counterclaim, (iii) the jurisdiction of any court, (iv) service process, (v) attachment upon or prior to judgment, (vi) attachment in aid of execution of judgment, (vii) execution of judgment, or (viii) other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which any action, suit or proceeding may at any time be commenced with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Agreement, such Grantor, to the fullest extent it may effectively do so under applicable law, hereby irrevocably and unconditionally waives, and agrees not to plead or claim, any such immunity and consents to such relief and enforcement. (g) EACH GRANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, 27 TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE SECOND PRIORITY NOTE DOCUMENTS, THE ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. 28 IN WITNESS WHEREOF, each Grantor has caused this Agreement to be duty executed and delivered by its officer thereunto duly authorized as of the date first above written. Address for Notices: HOLLINGER INC. - ------------------- 10 Toronto Street By /s/ Peter G. White Toronto, Canada M5C 2B7 ----------------------------- Attention: Chief Financial Officer Title: Co-COO Address for Notices: RAVELSTON MANAGEMENT INC. - ------------------- 10 Toronto Street By /s/ Peter G. White Toronto, Canada M5C 2B7 ----------------------------- Attention: Chief Financial Officer Title: Executive VP Address for Notices: 504468 N.B. INC. - ------------------- 10 Toronto Street By /s/ Peter G. White Toronto, Canada M5C 2B7 ----------------------------- Attention: Chief Financial Officer Title: Executive VP 29 SCHEDULE I TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT LOCATION, CHIEF EXECUTIVE OFFICE, PLACE WHERE AGREEMENTS ARE MAINTAINED, TYPE OF ORGANIZATION, JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION NUMBER
LOCATION, CHIEF EXECUTIVE JURISDICTION OFFICE, AND PLACE WHERE TYPE OF OF ORGANIZATIONAL GRANTOR AGREEMENTS ARE MAINTAINED ORGANIZATION ORGANIZATION I.D. NO. ------- ------------------------- ------------ ------------ -------- Hollinger Inc. 10 Toronto Street, Canadian Canada 197578-I Toronto, Canada M5C 2B7 Corporation Ravelston 10 Toronto Street, Ontario Ontario, Canada 1517107 Management Inc. Toronto, Canada M5C 2B7 Corporation 504468 N.B. Inc. 10 Toronto Street, New Brunswick New Brunswick, 504468 Toronto, Canada M5C 2B7 Corporation Canada (Registered office and agent at the following address: Stewart McKelvey Stirling Scales 10th Floor, Brunswick House 44 Chipman Hill Saint John, New Brunswick Canada, E2L 2A9 Correspondence: P.O. Box 7289 Postal Station A Saint John, New Brunswick Canada, E2L 4S6)
SCHEDULE II TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT PLEDGED EQUITY
- ---------------------------- --------------- ---------- ----------------- ----------------- ----------------- PERCENTAGE CLASS OF OF CLASS OF EQUITY CERTIFICATE NUMBER OUTSTANDING ISSUER INTEREST PAR VALUE NO(S) OF SHARES SHARES - ---------------------------- --------------- ---------- ----------------- ----------------- ----------------- Hollinger International Class B $0.01 B0005 12,990,000 86.66% Inc. Common Stock - ---------------------------- --------------- ---------- ----------------- ----------------- ----------------- Hollinger International Class B $0.01 B0006 2,000,000 13.34% Inc. Common Stock - ---------------------------- --------------- ---------- ----------------- ----------------- -----------------
SCHEDULE III TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT ASSIGNED AGREEMENTS GRANTOR ASSIGNED AGREEMENT - ------- ------------------ RMI Services Agreement between Hollinger International Inc. and The Ravelston Corporation Limited, dated as of January 1, 1998 as assigned by The Ravelston Corporation, Limited to Ravelston Management Inc. pursuant to a Transfer and Consent Agreement dated July 5, 2002 (as amended, amended and restated, or otherwise modified or supplemented from time to time). (Agreement has been terminated). RMI Amended and Restated Services Agreement between Hollinger Canadian Publishing Holdings Co. and The Ravelston Corporation Limited, dated as of December 1, 1999 as assigned by The Ravelston Corporation Limited to Ravelston Management Inc. pursuant to a Transfer and Consent Agreement dated July 5, 2002 (as amended, amended and restated, or otherwise modified or supplemented from time to time). (Agreement has been terminated). HI Support Agreement between Hollinger Inc. and Ravelston Management Inc. dated as of March 10, 2003 (as amended, amended and restated, or otherwise modified or supplemented from time to time). SCHEDULE IV TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT CHANGES IN NAME, LOCATION, ETC. None. EXHIBIT A TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT FORM OF SECOND PRIORITY NOTES SECURITY AGREEMENT SUPPLEMENT [Date] HSBC Bank USA, National Association, as Trustee and Collateral Agent under the Indenture referred to below Attn: Corporate Trust Hollinger Inc. Ladies and Gentlemen: Reference is made to (i) the Indenture dated as of September 30, 2004 (as amended, amended and restated, supplemented or otherwise modified from time to time, the "SECOND PRIORITY NOTES INDENTURE"), among Hollinger Inc., (the "COMPANY"), as the issuer of Second Priority Notes thereunder, Ravelston Management Inc. ("RMI"), 504468 N.B. Inc. ("NBI"), The Ravelston Corporation Limited, Sugra Limited, and HSBC Bank USA, National Association, as trustee and collateral agent (together with any successor appointed pursuant to the Second Priority Notes Indenture, the "SECOND PRIORITY NOTES COLLATERAL AGENT"), and (ii) the Second Priority Notes Security Agreement dated as of September 30, 2004 (as amended, amended and restated, supplemented or otherwise modified from time to time, the "SECOND PRIORITY NOTES SECURITY AGREEMENT") made by the Grantors from time to time party thereto in favor of the Second Priority Notes Collateral Agent for the Second Priority Secured Parties (as defined therein). Terms defined in the Second Priority Notes Indenture or the Second Priority Notes Security Agreement and not otherwise defined herein are used herein as defined in the Second Priority Notes Indenture or the Second Priority Notes Security Agreement. SECTION 1. Grant of Security. The undersigned hereby grants, assigns and transfers to the Second Priority Notes Collateral Agent, for the ratable benefit of the Second Priority Secured Parties, a second priority security interest in, all of its right, title and interest in and to all of the Collateral of the undersigned, whether now owned or hereafter acquired by the undersigned, wherever located and whether now or hereafter existing or arising, including, without limitation, the property and assets of the undersigned set forth on the attached supplemental schedules to the Schedules to the Second Priority Notes Security Agreement. SECTION 2. Security for Obligations. The grant of a second priority security interest in, the Collateral by the undersigned under this Agreement Supplement and the Second Priority Notes Security Agreement secures the payment of all obligations of the undersigned now or hereafter existing under or in respect of the Second Priority Note Documents, whether direct or indirect, absolute or contingent, and whether for principal, reimbursement obligations, interest, premiums, penalties, fees, indemnifications, contract causes of action, costs, expenses or otherwise. Without limiting the generality of the foregoing, this Second Priority Notes Security Agreement Supplement and the Second Priority Notes Security Agreement secures the payment of all amounts that constitute part of the Secured Obligations and that would be owed by the undersigned, whether incurred alone or with another or others and whether as principal, guarantor or surety, to any Secured Party under the Second Priority Note Documents but for the fact that such Secured Obligations are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving a Grantor or any Affiliate of a Grantor. SECTION 3. Supplements to Second Priority Notes Security Agreement Schedules. The undersigned has attached hereto supplemental Schedules I through III to Schedules I through III, respectively, to the Second Priority Notes Security Agreement, and the undersigned hereby certifies, as of the date first above written, that such supplemental schedules have been prepared by the undersigned in substantially the form of the equivalent Schedules to the Second Priority Notes Security Agreement and are complete and correct. SECTION 4. Representations and Warranties. The undersigned hereby makes each representation and warranty set forth in Section 8 of the Second Priority Notes Security Agreement (as supplemented by the attached supplemental schedules) to the same extent as each other Grantor. SECTION 5. Obligations Under the Second Priority Notes Security Agreement. The undersigned hereby agrees, as of the date first above written, to be bound as a Grantor by all of the terms and provisions of the Second Priority Notes Security Agreement to the same extent as each of the other Grantors. The undersigned further agrees, as of the date first above written, that each reference in the Second Priority Notes Security Agreement to an "Additional Grantor" or a "Grantor" shall also mean and be a reference to the undersigned. SECTION 6. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. (a) The undersigned hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof; in any action or proceeding arising out of or relating to this Agreement or any of the other Second Priority Note Documents to which it is or is to be a party, or for recognition or enforcement of any judgment, and the undersigned hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in any such New York State court or, to the extent permitted by law, in such federal court. The undersigned agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Second Priority Note Document shall affect any right that any party may otherwise have to bring any action or proceeding relating to this Agreement or any other Second Priority Note Document in the courts of airy jurisdiction. (b) The undersigned irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any of the other Second Priority Note Documents to which it is or is to be a party in any New York State or federal court. The undersigned hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such suit, action or proceeding in any such court. (c) The undersigned represents, warrants and agrees that, prior to the Closing Date, it will have appointed Corporation Service Company as its authorized agent (the "AUTHORIZED Agent", which term, as used herein, includes any successor in such capacity) upon whom process may be served in any such action, suit or proceeding arising out of, based on or relating to this Agreement or any of the transactions contemplated hereby. Such appointment shall, to the fullest extent it may effectively do so under applicable law, be irrevocable. The undersigned represents, warrants and agrees that, prior to the Closing Date, the Authorized Agent will have agreed to act as such agent for service of process and the undersigned agrees, to the fullest extent it may effectively do so under applicable law, to take any and all action, including the filing of any and all documents and instruments and the payment of all fees, that may be necessary to effect and to continue such appointment in full force and effect as aforesaid for so long as any of the Secured Obligations shall be outstanding and until the principal of, premium, if any and interest on, and any and all other amounts payable under or with respect to the Secured Obligations shall have been paid in full. The undersigned agrees, to the fullest extent it may effectively do so under applicable law, that service of process upon the Authorized Agent and written notice for such service to the undersigned (mailed or delivered to its Secretary at the address shown next to its name on the signature page of this Agreement) shall be deemed, in every respect, effective service of process upon the undersigned in any such action, suit or proceeding. (d) In respect of any judgment or order given or made against the undersigned for any amount due hereunder that is expressed and paid in a currency (the "JUDGMENT CURRENCY") other than United States dollars, the undersigned will indemnify the Second Priority Notes Collateral Agent and each other Secured Party, from and against any and all loss incurred by such Secured Party as a result of any variation as between (i) the rate of exchange at which the United States dollar amount is converted into the judgment currency for the purpose of such judgment or order and (ii) the rate of exchange at which such Second Priority Secured Party is able to purchase United States dollars with the amount of judgment currency actually received by such Secured Party. The undersigned agrees, to the fullest extent it may effectively do so under applicable law, that the foregoing indemnity shall constitute a separate and independent obligation of the undersigned and shall continue in full force and effect notwithstanding any such judgment or order as aforesaid. The term "rate of exchange" shall include any premiums and costs of exchange payable in connection with the purchase of or conversion into United States dollars. (e) To the extent that the undersigned or any of its properties, assets or revenues may have, or may hereafter become entitled to, or have attributed to it, any right of immunity, on the grounds of sovereignty or otherwise, from (i) any legal action, suit or proceeding, (ii) setoff or counterclaim, (iii) the jurisdiction of any court, (iv) service process, (v) attachment upon or prior to judgment, (vi) attachment in aid of execution of judgment, (vii) execution of judgment, or (viii) other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which any action, suit or proceeding may at any time be commenced with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Agreement, the undersigned, to the fullest extent it may effectively do so under applicable law, hereby irrevocably and unconditionally waives, and agrees not to plead or claim, any such immunity and consents to such relief and enforcement. (f) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE SECOND PRIORITY NOTE DOCUMENTS, THE ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. Very truly yours, [NAME OF ADDITIONAL GRANTOR] By -------------------------------- Title: Address for notices: -------------------------------- -------------------------------- -------------------------------- EXHIBIT B TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT FORM OF ACCOUNT CONTROL AGREEMENT (DEPOSIT ACCOUNT/SECURITIES ACCOUNT) ACCOUNT CONTROL AGREEMENT (this "AGREEMENT") dated as of ________________ among ____________, a _______________ (the "GRANTOR"), HSBC Bank USA., National Association, as Trustee and Collateral Agent (the "SECURED PARTY"), _______________ and ________________, a (_____________ as securities intermediary and depository bank (the "ACCOUNT HOLDER")). PRELIMINARY STATEMENTS: (1) The Grantor has granted the Secured Party a second priority security interest (the "SECURITY INTEREST") in the following accounts maintained by the Account Holder for the Grantor (each, an "ACCOUNT" and collectively, the "ACCOUNTS"): [Insert account numbers and other identifying information.] (2) Terms defined in Article 8 or 9 of the Uniform Commercial Code in effect in the State of New York ("N.Y. UNIFORM COMMERCIAL CODE") are used in this Agreement as such terms are defined in such Article 8 or 9. NOW, THEREFORE, in consideration of the premises and of the mutual agreements contained herein, the parties hereto hereby agree as follows: SECTION 1. The Accounts. The Grantor and Account Holder represent and warrant to, and agrees with, the Secured Party that: (a) The Account Holder maintains each Account for the Grantor, and all property (including, without limitation, all funds and financial assets) held by the Account Holder for the account, of the Grantor are, and will continue to be, credited to an Account in accordance with instructions given by the Grantor (unless otherwise provided herein). (b) To the extent that funds are credited to any Account, such Account is a deposit account; and to the extent that financial assets are credited to any Account, such Account is a securities account. The Account Holder is (i) the bank with which each Account that is a deposit account is maintained and (ii) the securities intermediary with respect to financial assets held in any Account that is a securities account. The Grantor is (x) the Account Holder's customer with respect to the Accounts and (y) the entitlement holder with respect to financial assets credited from time to time to any Account. (c) Notwithstanding any other agreement to the contrary, the Account Holder's jurisdiction with respect to each Account for purposes of the N.Y. Uniform Commercial Code is, and will continue to be for so long as the Security Interest shall be in effect, the State of New York. (d) Attached as Exhibit A hereto are statements of the respective Accounts as of the date hereof showing the property credited to each Account. (e) The Grantor and Account Holder do not know of any claim to or interest in any Account or any property (including, without limitation, funds and financial assets) credited to any Account, except for claims and interests of the parties referred to in this Agreement. SECTION 2. Confirmation of Grant of Security Interest. The Grantor hereby confirms that it has granted to the Secured Party a second priority security interest in the Accounts, all property credited thereto and all proceeds thereof, pursuant to the Second Priority Notes Security Agreement (the "SECURITY AGREEMENT") dated September 30, 2004 among the Grantor, the Secured Party, and certain other parties thereto. To the extent (and only to the extent) that such grant is for any reason found to be invalid, the Grantor hereby grants to the Secured Party a second priority security interest in the Accounts, all property credited thereto from time to time, all proceeds thereof, and all other property related thereto as more fully described in the Security Agreement, as security for the Secured Obligations (as defined in the Security Agreement). SECTION 3. Control by Secured Party. The Account Holder will comply with (i) all instructions directing disposition of the funds in any and all of the Accounts, (ii) all notifications and entitlement orders that the Account Holder receives directing it to transfer or redeem any financial asset in any and all of the Accounts, and (iii) all other directions concerning any and all of the Accounts, including, without limitation, directions to distribute to the Secured Party proceeds of any such transfer or redemption or interest or dividends on property in any and all of the Accounts (any such instruction, notification or direction referred to in clause (i), (ii) or (iii) above being an "ACCOUNT DIRECTION"), in each case of clauses (i), (ii) and (iii) above originated by the Secured Party without further consent by the Grantor or any other person or entity. SECTION 4. Grantor's Rights in Accounts. (a) The Account Holder will comply with Account Directions and other directions concerning each Account originated by, and only by, the Secured Party. (b) Until the Account Holder receives a notice from the Secured Party that the Secured Party will exercise exclusive control over any Account (a "NOTICE OF EXCLUSIVE CONTROL" with respect to such Account), the Account Holder may distribute to the Grantor all interest and regular cash dividends on property (including, without limitation, funds and financial assets) in such Account. (c) If the Account Molder receives from the Secured Party a Notice of Exclusive Control with respect to any Account, the Account Holder will cease distributing to the Grantor all interest and dividends on property (including, without limitation, funds and financial assets) in such Account. SECTION 5. Priority of Secured Party's Security Interest. (a) The Account Holder (i) subordinates to the Security Interest and in favor of the Secured Party any security interest, lien, or right of recoupment or setoff that the Account Holder may have, now or in the future, against any Account or property (including, without limitation, any funds and financial assets) credited to any Account, and (ii) agrees that it will not exercise any right in respect of any such security interest or lien or any such right of recoupment or setoff until the Security Interest is terminated, except that the Account Holder (A) will retain its prior security interest and lien on property credited to any Account, (B) may exercise any right in respect of such security interest or lien, and (C) may exercise any right of recoupment or setoff against any Account, in the case of clauses (A), (B) and (C) above, to secure or to satisfy, and only to secure or to satisfy, payment (x) for such property, (y) for its customary fees and expenses for the routine maintenance and operation of such Account, and (z) if such Account is a deposit account, for the face amount of any items that have been credited to such Account but are subsequently returned unpaid because of uncollected or insufficient funds. (b) The Account Holder will not enter into any other agreement with any person or entity relating to Account Directions or other directions with respect to any Account. SECTION 6. Statements, Confirmations and Notices of Adverse Claims. (a) The Account Holder will send copies of all statements and confirmations for each Account simultaneously to the Secured Party and the Grantor. (b) When the Account Holder knows of any claim or interest in any Account or any property (including, without limitation, funds and financial assets) credited to any Account other than the claims and interests of the parties referred to in this Agreement, the Account Holder will promptly notify the Secured Party and the Grantor of such claim or interest. SECTION 7. The Account Holder's Responsibility. (a) Except for permitting a withdrawal, delivery, or payment in violation of Section 4, the Account Holder will not be liable to the Secured Party for complying with Account Directions or other directions concerning any Account from the Grantor that are received by the Account Holder before the Account Holder receives and has a reasonable opportunity to act on a Notice of Exclusive Control. (b) The Account Holder will not be liable to the Grantor or the Secured Party for complying with a Notice of Exclusive Control or with an Account Direction or other direction concerning any Account originated by the Secured Party, even if the Grantor notifies the Account Holder that the Secured Party is not legally entitled to issue the Notice of Exclusive Control or Account Direction or such other direction unless the Account Holder takes the action after it is served with an injunction, restraining order, or other legal process enjoining it from doing so, issued by a court of competent jurisdiction, and had a reasonable opportunity to act on the injunction, restraining order or other legal process. (c) This Agreement does not create any obligation of the Account Holder except for those expressly set forth in this Agreement and, in the case of any Account that is a securities account, in Part 5 of Article 8 of the N.Y. Uniform Commercial Code and, in the case of any Account that is a deposit account, in Article 4 of the N.Y. Uniform Commercial Code. In particular, the Account Holder need not investigate whether the Secured Party is entitled tinder the Secured Party's agreements with the Grantor to give an Account Direction or other direction concerning any Account or a Notice of Exclusive Control. The Account Holder may rely on notices and communications it believes given by the appropriate party. SECTION 8. Indemnity. The Grantor will indemnify the Account Holder, its officers, directors, employees and agents against claims, liabilities and expenses arising out of this Agreement (including, without limitation, reasonable attorney's fees and disbursements), except to the extent the claims, liabilities or expenses are caused by the Account Holder's gross negligence or willful misconduct as found by a court of competent jurisdiction in a final, non-appealable judgment. SECTION 9. Termination; Survival. (a) The Secured Party may terminate this Agreement by notice to the Account Holder and the Grantor. If the Secured Party notifies the Account Holder that the Security Interest has terminated, this Agreement will immediately terminate. (b) The Account Holder may terminate this Agreement on 60 days' prior notice to the Secured Party and the Grantor, provided that before such termination the Account Holder and the Grantor shall make arrangements to transfer the property (including, without limitation, all funds and financial assets) credited to each Account to another Account Holder that shall have executed, together with the Grantor, a control agreement in favor of the Secured Party in respect of such property in substantially the form of this Agreement or otherwise in form and substance satisfactory to the Secured Party. (c) Sections 7 and 8 will survive termination of this Agreement. SECTION 10. Governing Law. This Agreement and each Account will be governed by the law of the State of New York. The Account Holder and the Grantor may not change the law governing any Account without the Secured Party's express prior written agreement. SECTION 11. Entire Agreement. This Agreement is the entire agreement, and supersedes any prior agreements, and contemporaneous oral agreements, of the parties concerning its subject matter. SECTION 12. Amendments. No amendment of, or waiver of a right under, this Agreement will be binding unless it is in writing and signed by the party to be charged. SECTION 13. Financial Assets. The Account Holder agrees with the Secured Party and the Grantor that, to the fullest extent permitted by applicable law, all property (other than funds) credited from time to time to any Account will be treated as financial assets under Article 8 of the N.Y. Uniform Commercial Code. SECTION 14. Notices. A notice or other communication to a party under this Agreement will be in writing (except that Account Directions may be given orally), will be sent to the party's address set forth under its name below or to such other address as the party may notify the other parties and will be effective on receipt. SECTION 15. Binding Effect. This Agreement shall become effective when it shall have been executed by the Grantor, the Secured Party and the Account Holder, and thereafter shall be binding upon and inure to the benefit of the Grantor, the Secured Party and the Account Holder and their respective successors and assigns. SECTION 16. Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by telecopier shall be effective as delivery of an original executed counterpart of this Agreement. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written. [NAME OF GRANTOR] By: --------------------------------------- Name: Title: Address: ------------------------------------------- ------------------------------------------- HSBC Bank USA, National Association, as Trustee and Collateral Agent By: --------------------------------------- Name: Title: Address: ------------------------------------------- ------------------------------------------- [NAME OF ACCOUNT HOLDER] By: --------------------------------------- Name: Title: Address: ------------------------------------------- ------------------------------------------- EXHIBIT C TO THE SECOND PRIORITY NOTES SECURITY AGREEMENT CONSENT AND AGREEMENT OF RAVELSTON MANAGEMENT INC. The undersigned hereby (a) acknowledges notice of, and consents to the terms and provision of, the Second Priority Notes Security Agreement dated as of September 30, 2004 (as amended, amended and restated, supplemented or otherwise modified from time to time, the "SECOND PRIORITY NOTES SECURITY AGREEMENT", the terms defined therein being used herein as therein defined) among Hollinger Inc. and certain other grantors from time to time party thereto and HSBC Bank USA, National Association, as Trustee and Collateral Agent (the "SECOND PRIORITY NOTES COLLATERAL AGENT") for the Second Priority Secured Parties referred to therein, (b) consents in all respects to the pledge and assignment to the Second Priority Notes Collateral Agent of all of the Grantor's (as defined below) right, title and interest in, to and under the Assigned Agreement (as defined below) pursuant to the Second Priority Notes Security Agreement, (c) acknowledges that the Grantor has provided it with notice of the right of the Second Priority Notes Collateral Agent in the exercise of its rights and remedies under the Second Priority Notes Security Agreement to make all demands, give all notices, take all actions and exercise all rights of the Grantor under the Assigned Agreement, and (d) agrees with the Second Priority Notes Collateral Agent that: (1) A true copy of the Support Agreement between the undersigned and Hollinger Inc. (the "GRANTOR") dated as of March 10, 2003 (the "ASSIGNED AGREEMENT), including, without limitation, all amendments, modifications, restatements and supplements is attached hereto as Schedule I. The Assigned Agreement is in full force and effect and enforceable against the undersigned, and the undersigned is not aware of any default under the Assigned Agreement or any event that would give any party the right to terminate or rescind the Assigned Agreement. No prepayments have been made of any amounts to become due under the Assigned Agreement. (2) The undersigned will make all payments to be made by it under or in connection with the Assigned Agreement provided that in the event that an Event of Default has occurred and is continuing, the undersigned will make payment of 100% of all amounts payable thereunder directly to the First Priority Notes Collateral Agent (as defined in the Second Priority Notes Security Agreement). (3) All payments referred to in paragraph 2 above shall be made by the undersigned irrespective of, and without deduction for, any counterclaim, defense, recoupment or set-off and shall be final, and the undersigned will not seek to recover from any Secured Party for any reason any such payment once made. (4) After the occurrence of an Event of Default which is continuing, the First Priority Notes Collateral Agent (as defined in the Second Priority Notes Security Agreement) or its designee shall be entitled to exercise any and all rights and remedies of the Grantor under the Assigned Agreement in accordance with the terms of the First Priority Notes Security Agreement (as defined in the Second Priority Notes Security Agreement), and the undersigned shall comply in all respects with such exercise. (5) The undersigned will not, without the prior written consent of the Second Priority Notes Collateral Agent, except as required pursuant to the First Priority Notes Indenture (as defined in the Second Priority Note's Security Agreement) or the First Priority Notes Security Agreement (i) cancel or terminate the Assigned Agreement or consent to or accept any cancellation or termination thereof, or (ii) amend, amend and restate, supplement or otherwise modify the Assigned Agreement, except, in each case, to the extent otherwise permitted under the Second Priority Note Documents referred to in the Second Priority Notes Security Agreement. (6) Except as required pursuant to the First Priority Notes Indenture or the First Priority Notes Security Agreement, in the event of a default by the Grantor in the performance of any of its obligations under the Assigned Agreement, or upon the occurrence or non-occurrence of any event or condition under the Assigned Agreement which would immediately or with the passage of any applicable grace period or the giving of notice, or both, enable the undersigned to terminate or suspend its obligations under the Assigned Agreement, the undersigned shall not terminate the Assigned Agreement until it first gives the First Priority Notes Collateral Agent written notice of the default and permits the First Priority Notes Collateral Agent to cure the default within a period of 30 days after the later of (i) notice of default having been given to the First Priority Notes Collateral Agent by the undersigned and (ii) the expiration of the applicable cure period provided in the Assigned Agreement for the Grantor to cure the default. (7) The undersigned shall deliver to the Second Priority Notes Collateral Agent, concurrently with the delivery thereof to the Grantor, a copy of each notice, request or demand given by the undersigned pursuant to the Assigned Agreement. (8) Except as specifically provided in this Consent and Agreement, neither the Second Priority Notes Collateral Agent nor any other Second Priority Secured Party shall have any liability or obligation under the Assigned Agreement as a result of this Consent and Agreement, the Second Priority Notes Security Agreement or otherwise. (9) Upon the enforcement of the First Priority Notes Security Agreement by the First Priority Notes Collateral Agent and the transfer of the Assigned Agreement to a transferee, the undersigned will recognize the transferee as the counterparty to the Assigned Agreement in the place and stead of the Grantor. This Consent and Agreement shall be binding upon the undersigned and its successors and assigns, and shall inure, together with the rights and remedies of the Second Priority Notes Collateral Agent hereunder, to the benefit of the Second Priority Secured Parties and their successors, transferees and assigns. This Consent and Agreement shall be governed by and construed in accordance with the laws of the State of New York. IN WITNESS WHEREOF, the undersigned has duly executed this Consent and Agreement as of the date set opposite its name below. Dated: September ___, 2004 RAVELSTON MANAGEMENT INC. By: ----------------------------- Name: Title: SCHEDULE I EX-99 5 mv2-14ex_12.txt EXHIBIT 12 EXHIBIT 12 POWER OF ATTORNEY The undersigned hereby constitutes and appoints G. Wesley Voorheis as the undersigned's true and lawful authorized representative and attorney-in-fact to execute for and on behalf of the undersigned and to file with the United States Securities and Exchange Commission and any other authority any Schedule 13D, and any amendments thereto, on behalf of the undersigned in accordance with Section 13 of the of the Securities Exchange Act of 1934, as amended (the "1934 Act") and the rules promulgated thereunder. The undersigned hereby grants to such attorney-in-fact full power and authority to do and perform all and every act and thing whatsoever requisite, necessary and proper to be done in the exercise of the rights and powers herein granted, hereby ratifying and confirming all that such attorney-in-fact shall lawfully do or cause to be done by virtue of this power of attorney and the rights and powers herein granted. The undersigned acknowledges that the foregoing attorney-in-fact, in serving in such capacity at the request of the undersigned, is not assuming any of the undersigned's responsibilities to comply with Section 13 or any other provision of the 1934 Act. This Power of Attorney shall remain in full force and effect until the undersigned is no longer required to file any Schedule 13D, unless earlier revoked by the undersigned in a signed writing delivered to the foregoing attorney-in-fact. This Power of Attorney is governed by the laws of the Province of Ontario and the laws of Canada applicable therein. IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney to be executed as of this 13th day of February, 2007. HOLLINGER INC. By: /s/ R. C. Benson ----------------------------------- Name: Randall C. Benson Title: Chief Restructuring Officer EX-99 6 mv2-14ex_13.txt EXHIBIT 13 EXHIBIT 13 POWER OF ATTORNEY The undersigned hereby constitutes and appoints G. Wesley Voorheis as the undersigned's true and lawful authorized representative and attorney-in-fact to execute for and on behalf of the undersigned and to file with the United States Securities and Exchange Commission and any other authority any Schedule 13D, and any amendments thereto, on behalf of the undersigned in accordance with Section 13 of the of the Securities Exchange Act of 1934, as amended (the "1934 Act") and the rules promulgated thereunder. The undersigned hereby grants to such attorney-in-fact full power and authority to do and perform all and every act and thing whatsoever requisite, necessary and proper to be done in the exercise of the rights and powers herein granted, hereby ratifying and confirming all that such attorney-in-fact shall lawfully do or cause to be done by virtue of this power of attorney and the rights and powers herein granted. The undersigned acknowledges that the foregoing attorney-in-fact, in serving in such capacity at the request of the undersigned, is not assuming any of the undersigned's responsibilities to comply with Section 13 or any other provision of the 1934 Act. This Power of Attorney shall remain in full force and effect until the undersigned is no longer required to file any Schedule 13D, unless earlier revoked by the undersigned in a signed writing delivered to the foregoing attorney-in-fact. This Power of Attorney is governed by the laws of the Province of Ontario and the laws of Canada applicable therein. IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney to be executed as of this 13th day of February, 2007. 4322525 CANADA INC. By: /s/ R. C. Benson ------------------------------------ Name: Randall C. Benson Title: President -----END PRIVACY-ENHANCED MESSAGE-----