10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended June 30, 2006
OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Commission File Number 033-75156

MEDIANEWS GROUP, INC.

(Exact name of registrant as specified in its charter)

Delaware	76-0425553
(State or other jurisdiction of	(I.R.S. Employer Identification Number)
incorporation or organization)
101 W. Colfax, Denver, Colorado	80202
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (303) 954-6360

Securities registered pursuant to Section 12(b) of the Act:
NONE

Securities registered pursuant to Section 12(g) of the Act:
NONE

     Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [  ] No [X]

     Indicate by check mark if the registrant is not required to file reports to Section 13 or Section 15(d) of the Act. Yes [X] No [  ]

     Indicate by check mark whether the registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Item (1) Yes [X] No [  ]; Item (2) Yes [  ] No [X*]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ] Accelerated filer [  ] Non-accelerated filer [X]

     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

     State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked prices of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

     Not applicable as there is no active market for our common equity.

     The number of shares outstanding of the registrant’s common stock as of September 26, 2006 was 2,298,346.

Documents Incorporated By Reference: None

*The registrant’s duty to file reports with the Securities and Exchange Commission has been suspended in respect of its fiscal year commencing July 1, 2006 pursuant to Section 15(d) of the Securities Exchange Act of 1934. The registrant is filing this Annual Report on Form 10-K on a voluntary basis.

Table of Contents

		Page
Part I
Item 1.	Business		3
Item 1A.	Risk Factors		11
Item 1B.	Unresolved Staff Comments		14
Item 2.	Properties		14
Item 3.	Legal Proceedings		15
Item 4.	Submission of Matters to a Vote of Security Holders		15
Part II
Item 5.	Market for the Registrant's Common Equity and Related Stockholder Matters and Issuer Purchases of Equity		16
Item 6.	Selected Financial Data		17
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operation		20
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		38
Item 8.	Financial Statements and Supplementary Data		40
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		40
Item 9A.	Controls and Procedures		40
Item 9B.	Other Information		40
Part III
Item 10.	Directors and Executive Officers of the Registrant		41
Item 11.	Executive Compensation		43
Item 12.	Security Ownership of Certain Beneficial Owners and Management		46
Item 13.	Certain Relationships and Related Transactions		48
Item 14.	Principal Accountant Fees and Services		49
Part IV
Item 15.	Exhibits and Financial Statement Schedules		51
Signatures			90
Fifth Amendment to Credit Agreement
Amendment and Restatement of Agreement
Limited Liability Company Operating Agreement
Second Amended and Restated Partnership Agreement
Third Amended and Restated Partnership Agreement
Subsidiaries
Certification Pursuant to Section 302
Certification Pursuant to Section 302
Certification Pursuant to Section 302
Certification Pursuant to Section 906
Certification Pursuant to Section 906

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Item 1: Business

General

     MediaNews Group, Inc. (“MediaNews” or “the Company”), a Delaware Corporation, was founded in March 1985. We are one of the largest privately owned newspaper companies in the United States in terms of daily paid circulation. We publish 54 market dominant daily and approximately 80 non-daily newspapers in 12 states, including suburban markets in close proximity to the San Francisco Bay area, San Jose, Los Angeles, New York, Baltimore and Boston. We also own metropolitan daily newspapers in Denver, Salt Lake City and Detroit that operate under joint operating agency (“JOA”) agreements. The newspapers we currently control had combined daily and Sunday paid circulation of approximately 2.6 million and 2.9 million, respectively, as of March 31, 2006 (including the daily circulation of the San Jose Mercury News and Contra Costa Times in California, which were acquired on August 2, 2006, and The Monterey County Herald in California and the St. Paul Pioneer Press in Minnesota, which we began managing on August 2, 2006 — see further discussion under “Recent Transactions”). We have grown primarily through strategic acquisitions, partnerships and, to a lesser extent, internal growth. One of our key strategies is geographic clustering. This strategy involves acquiring newspapers, or partnering with newspapers, in markets contiguous to those in which we already operate. Clustering has allowed us to realize substantial revenue synergies and cost efficiencies, resulting in higher operating cash flow growth at those newspapers than they would have achieved on a stand-alone basis.

     Our newspapers are generally positioned in markets with limited direct competition for local newspaper advertising. Start-ups of new daily newspapers in suburban markets with pre-existing local newspapers are infrequent. We believe that our newspaper markets, taken as a whole, have above average population and sales growth potential. Most suburban and small city daily newspapers, such as a majority of the newspapers we own, have the leading or sole distribution in the markets they serve. Suburban newspapers address the specific needs of a community by publishing a broad spectrum of local news as well as advertiser specific editions which television, because of its broader geographic coverage, is unwilling or unable to provide. Thus, in many communities, the local newspaper provides a combination of social and economic services in a way that only it can, making it attractive for both consumers and advertisers. Our suburban newspapers generate the majority of their revenues from local retail, classified and circulation sales, which we believe are less affected by national economic trends and therefore tend to provide a more stable base of operating cash flow. On the other hand, our metropolitan newspapers generate significant print revenues from high margin national and employment advertising, which is strongly influenced by national and local economic conditions and trends.

     In conjunction with several of our daily newspapers, we operate sizeable weekly newspaper groups that extend our reach and advertising opportunities in and around our daily newspaper markets. Suburban weekly newspapers allow us to attract a different base of advertisers than our paid daily newspapers, such as small local retailers, local classifieds and restaurants, which improves our competitive positioning, reduces the threat of competition from direct mail and shoppers (free circulars) and achieves greater household penetration in our newspaper markets. Our largest suburban weekly newspaper groups operate in conjunction with our San Francisco Bay area newspapers, Los Angeles Newspapers Group and Connecticut Post.

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     The following sets forth our paid daily newspapers:

California	Massachusetts
Daily News, Los Angeles, CA	The Sun, Lowell, MA
Press-Telegram, Long Beach, CA	The Berkshire Eagle, Pittsfield, MA
The Monterey County Herald, Monterey, CA(a)	Sentinel & Enterprise, Fitchburg, MA
California Newspapers Partnership — 54.23%-owned partnership	North Adams Transcript, North Adams, MA
San Gabriel Valley Newspaper Group, CA
San Gabriel Valley Tribune, West Covina, CA	Michigan
Pasadena Star-News, Pasadena, CA	The Detroit News, Detroit, MI (JOA)(b)
Whittier Daily News, Whittier, CA
The Sun, San Bernardino, CA	Minnesota
Inland Valley Daily Bulletin, Ontario, CA	St. Paul Pioneer Press, St. Paul, MN(a)
ANG Newspapers, San Francisco Bay Area, CA
Oakland Tribune, Oakland, CA	Utah
Tri-Valley Herald, Pleasanton, CA	The Salt Lake Tribune, Salt Lake City, UT (JOA)
The Daily Review, Hayward, CA
The Argus, Fremont, CA	Vermont
Alameda Times-Star, Alameda, CA	Brattleboro Reformer, Brattleboro, VT
San Mateo County Times, San Mateo, CA	Bennington Banner, Bennington, VT
Marin Independent Journal, Marin, CA
Enterprise-Record/Oroville Mercury-Register, Chico & Oroville, CA	West Virginia
Times-Herald, Vallejo, CA	Charleston Daily Mail, Charleston, WV(b)
Times-Standard, Eureka, CA
The Reporter, Vacaville, CA	Texas-New Mexico Newspapers Partnership — 59.4%-owned partnership
Daily Democrat, Woodland, CA	Texas
The Ukiah Daily Journal, Ukiah, CA	El Paso Times, El Paso, TX
Redlands Daily Facts, Redlands, CA	New Mexico
Lake County Record-Bee, Lakeport, CA Red Bluff Daily News, Red Bluff, CA	Las Cruces Sun-News, Las Cruces, NM The Daily Times, Farmington, NM
San Jose Mercury News, San Jose, CA	Carlsbad Current-Argus, Carlsbad, NM
Contra Costa Times, Walnut Creek, CA	Alamogordo Daily News, Alamogordo, NM
	The Deming Headlight, Deming, NM
Colorado	Pennsylvania
The Denver Post, Denver, CO (JOA)	York Daily Record & The York Dispatch, York, PA (JOA)
Prairie Mountain Publishing Company, CO - 50%-owned partnership	Lebanon Daily News, Lebanon, PA
The Fort Morgan Times, Fort Morgan, CO	The Evening Sun, Hanover, PA
Journal-Advocate, Sterling, CO	Public Opinion, Chambersburg, PA
Lamar Daily News, Lamar, CO
Daily Camera, Boulder, CO
Connecticut
Connecticut Post, Bridgeport, CT

(a)	We manage these newspapers for The Hearst Corporation (see additional discussion under Recent Transactions).
(b)	We are responsible only for editorial and news content.

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Industry Background

     Newspaper publishing is the oldest and largest segment of the media industry. Newspapers address the specific needs of readers and advertisers in the communities they serve by publishing a broad spectrum of local news as well as special editions that are targeted to specific advertisers and readers. In most communities, the local newspaper provides the primary voice for local news and information, including business, sports, government and social as well as political commentary, making a newspaper’s content attractive to both readers and advertisers. We believe that the local newspaper’s close relationship with its readers and the community is one of the primary reasons why newspapers remain a dominant medium for local advertising, accounting for approximately 42% of all local media advertising expenditures in the United States in calendar 2005.⁽¹⁾

     We believe that, due to continuing fragmentation of other advertising mediums, newspapers are one of the last mass market mediums available for advertisers. In addition, newspapers are one of the few forms of mass media used by readers for both editorial and advertising content. Readers of newspapers also tend to be more highly educated and have higher incomes than non-newspaper readers, with a recent survey showing approximately 56% of college graduates and 58% of households with incomes greater than $75,000 read a daily newspaper.⁽¹⁾ Because of the desirable demographics and mass market reach of daily newspapers, we believe that they represent the most cost-effective means for advertisers to reach a broad and affluent spectrum of consumers.

     With the exception of a few of the largest cities, most cities in the United States do not have more than one daily newspaper.

Recent Transactions

Acquisitions

San Jose Mercury News, Contra Costa Times, The Monterey County Herald and St. Paul Pioneer Press

     On April 26, 2006, MediaNews Group, Inc. and The McClatchy Company (“McClatchy”) entered into a Stock and Asset Purchase Agreement (the “MediaNews Purchase Agreement”) pursuant to which we agreed to purchase the Contra Costa Times and the San Jose Mercury News and related publications and Web sites for $736.8 million. We consummated the purchase from McClatchy on August 2, 2006 through the California Newspapers Partnership (“CNP”), a 54.23%-owned subsidiary. The acquisition, including fees, was funded in part with contributions of $340.1 million from our partners in CNP. Our share of the acquisition, including fees, was approximately $403.0 million and was funded with borrowings under a new term loan “C” and our existing bank revolver. See further discussion of our amended bank credit facility under “Recent Transactions — Debt.”

     On April 26, 2006, The Hearst Corporation (“Hearst”) and McClatchy entered into a Stock and Asset Purchase Agreement (the “Hearst Purchase Agreement”) pursuant to which Hearst agreed to purchase The Monterey County Herald and the St. Paul Pioneer Press and related publications and Web sites for $263.2 million. Hearst and McClatchy consummated such purchase on August 2, 2006. On August 2, 2006, we entered into an agreement with Hearst (the “MediaNews/Hearst Agreement”) pursuant to which (i) Hearst agreed to make an equity investment of up to $299.4 million (subject to adjustment under certain circumstances) in us (such investment will not include any governance or economic rights or interest in our publications in the San Francisco Bay area) and (ii) we agreed to purchase from Hearst The Monterey County Herald and the St. Paul Pioneer Press with a portion of the Hearst equity investment. The equity investment will afford Hearst an equity interest of approximately 30% (subject to adjustment in certain circumstances) in our publications outside the San Francisco Bay area. The equity investment by Hearst in us is subject to regulatory approval, and a review is currently underway by the Antitrust Division of the Department of Justice. The Antitrust Division has requested information and documents in connection with this review, and we are in the process of responding to the request. We have agreed to manage The Monterey County Herald and the St. Paul Pioneer Press during the period of ownership by Hearst, with us retaining all the net cash flows from these newspapers as a management fee. We also agreed that at the election of MediaNews or Hearst, we will purchase The Monterey County Herald and the St. Paul Pioneer Press from Hearst for $263.2

⁽¹⁾ Source: Newspaper Association of America

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million (plus reimbursement to Hearst for its cost of funds with respect to its purchase of such newspapers) if for any reason Hearst’s equity investment in us is not consummated within six months. We would need to obtain additional financing to fund this purchase. If necessary, we currently intend to fund the purchase price of the St. Paul Pioneer Press and The Monterey County Herald through equity investments from other sources or debt issued by a newly formed holding company that would be the parent company of MediaNews. A portion of the purchase price related to The Monterey County Herald would be funded by one or more partners as described below.

     On April 26, 2006, we also entered into an agreement (the “Stephens/Gannett Contribution Agreement”) with Gannett Co., Inc. (“Gannett”) and S.F. Holding Corporation (“Stephens”), formerly Stephens Media Group, pursuant to which Gannett and Stephens agreed to contribute their pro rata share of the initial purchase price (plus estimated transaction fees and expenses) of The Monterey County Herald for a total ranging between approximately $27.4 million and $38.4 million depending on whether The Monterey County Herald is purchased by the California Newspapers Partnership or, if necessary, a new partnership between us and Stephens, to be owned 67.36% by us and 32.64% by Stephens.

Debt

     On September 8, 2005, we amended our December 30, 2003 bank credit facility (the “amended facility”). The amended facility maintained the $350.0 million revolving credit facility, the $100.0 million term loan “A” and provided for a $147.3 million term loan “B,” which was used to pay off a term loan “C” facility. On August 2, 2006, we entered into another amendment of the amended facility. The August 2, 2006 amendment was entered into in order to create a new $350.0 million term loan “C” facility and to authorize us to purchase the Contra Costa Times, San Jose Mercury News, The Monterey County Herald and the St. Paul Pioneer Press. The $350.0 million term loan “C” facility was funded on August 2, 2006 and, used along with borrowings under our revolver, to pay our portion of the purchase price of the Contra Costa Times and the San Jose Mercury News.

     The term loan “B” bears interest based upon, at the Company’s option, Eurodollar or base rates, plus a borrowing margin of 1.25% or 0.25%, respectively. Term loan “B” requires quarterly principal payments as follows: $0.4 million through December 2009; $35.2 million from March through September 2010, with the remaining balance due at maturity on December 30, 2010. Term loan “C” bears interest based upon, at the Company’s option, Eurodollar, plus a borrowing margin of 1.75%, or base rate, plus a borrowing margin of 0.75%. Term loan “C” requires quarterly principal payments as follows: $0.875 million through June 2012; and $82.25 million from June 2012 through March 2013, with the remaining balance due at maturity on August 2, 2013. Amounts repaid under the term loans are not available for re-borrowing. Borrowings under the revolving facility may be repaid and re-borrowed, subject to usual and customary conditions for facilities of this nature. The revolving credit facility reduces to $250.0 million on December 30, 2008 and matures on December 30, 2009.

Other Transactions

Texas-New Mexico Newspapers Partnership

     Effective December 26, 2005, we restructured the Texas-New Mexico Newspapers Partnership (“TNMP”) whereby we contributed to TNMP our Pennsylvania newspapers, The Evening Sun (Hanover), the Lebanon Daily News and our interest in the partnership that publishes the York Daily Record and York Sunday News, which will continue to operate under the terms of a JOA agreement along with The York Dispatch. Our partner, Gannett, contributed The Public Opinion in Chambersburg, Pennsylvania. As a result of the contributions and the amendment of the TNMP agreement, TNMP became a 59.4% owned consolidated subsidiary of ours.

Prairie Mountain Publishing Company

     On February 1, 2006, we formed the Prairie Mountain Publishing Company (“PMP”) with E.W. Scripps Company (“Scripps”). Upon formation of PMP, we contributed substantially all of the operating assets used in the publication of the newspapers published by Eastern Colorado Publishing Company comprised of several small daily and weekly newspapers published in eastern Colorado, and Scripps contributed substantially all of the operating assets used in the publication of the Daily Camera and the Colorado Daily, both published in Boulder, Colorado. In addition to the assets contributed to PMP, we paid Scripps approximately $20.4 million to obtain our 50% interest in PMP. Scripps owns the remaining interest in

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PMP. As a result of the partnership formation, we no longer consolidate the operations of Eastern Colorado Publishing Company and now account for our share of the operations of PMP under the equity method of accounting.

Detroit

     Effective August 3, 2005, we purchased the editorial assets of The Detroit News, published in Detroit, Michigan, and a 5% limited partnership interest in the Detroit JOA for approximately $25.0 million. We are responsible for the news and editorial content of The Detroit News for which we receive a fixed monthly preferred distribution with possible incremental distributions beginning in 2009 based on profit growth. Under the terms of the Detroit JOA agreement, we are reimbursed for our news and editorial costs. Because of the structure of the partnership and our ownership interest, we account for our investment in the Detroit JOA on the cost basis.

Operating Strengths and Strategies

     Our long-term operating strategy is to increase revenues and operating profit through geographic clustering, partnerships and internal growth. Our internal growth strategy is built on our key strengths, which include development of new revenue streams, local news leadership, circulation growth and prudent cost controls. In addition, we seek to drive revenue growth in our Internet operations by leveraging our local content across a diverse array of classified advertising categories, including employment, automotive, real estate and other Internet verticals.

     Geographic Clusters and Partnerships. One of our key acquisition strategies is to acquire newspapers in markets contiguous to our own. We refer to this strategy, which we pioneered, as “clustering.” Clustering enables us to realize operating efficiencies and economic synergies, such as the sharing of management, accounting, newsgathering, advertising and production facilities. In addition, we seek to increase operating cash flows at acquired newspapers by reducing labor costs and implementing overall improvements in cost management. Clustering also enables us to maximize revenues by selling advertising into newspapers owned by us in contiguous markets. We believe that this strategy allows us to achieve higher operating margins at our clustered newspapers than we would realize from those newspapers on a stand-alone basis. The acquisition of the San Jose Mercury News and Contra Costa Times is a continuation of this strategy. The California Newspapers Partnership (“CNP”), the Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company are also all extensions of this strategy.

     New Revenue Streams. We focus on developing and implementing new revenue initiatives and exporting these initiatives across all of our newspapers. Launching niche publications is one of our key initiatives. For example, in Denver, we launched YourHub.com, a zoned weekly, distributed in the newspaper, which is published from content created on the Internet by people in the community. We also launched Flipside, an entertainment publication in York, targeting 18 to 34 year olds in that market. We have other revenue growth initiatives, such as a monthly contest for the “best new revenue initiative,” revenue Think Tanks with our top sales executives, TOMA (“Top of Mind Awareness”) which introduces local advertisers to the power of newspaper advertising and SWAT programs which utilize the skills of our best sales representatives in a sales blitz at a sister newspaper. Our Los Angeles Newspaper Group publishes IMPACTO USA, a weekend home delivered Spanish-language newspaper. IMPACTO USA is home delivered every Saturday to over 250,000 targeted Hispanic households in Central and East Los Angeles, Long Beach and the San Fernando Valley under a distribution strategy developed through the Latino Newspaper Network, a marketing and advertising sales partnership in which we participate. In conjunction with these programs, we utilize market research, demographic studies, zoning, strong local market penetration and active community involvement to develop and implement marketing programs that allow us to maximize our share of the available advertising dollars in the market whether in print or online. An expansion of our zoning strategy is YourHub.com, described above, which publishes separate community editions. YourHub.com has over 40 online zones, along with 15 editorial and 10 advertising zoned editions of YourHub.com which are distributed weekly in both Denver newspapers on Thursday.

     Local News Leadership. We believe that we have assembled the largest local newsgathering resources in our markets, and we are committed to being the leading provider of trusted high quality local news in those markets. Each newspaper is locally managed and sets its own news coverage and editorial policy based on the local market. Our focus on in-depth local news coverage sets us apart from other news sources in our markets, contributing to reader loyalty and increasing franchise value. With the timeliness and availability of national and world news 24 hours a day on television and the Internet, we believe that providing in-depth local news coverage is invaluable and is what sets us apart from other news sources. To foster reader interaction and participation, we introduced “citizen journalism” with YourHub.com in Denver whereby local

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news content and photos are submitted directly by readers. In Denver, we have also introduced Podcasts in which The Denver Post’s top headlines, presented in an audio version, can be downloaded from the newspaper’s Web site, www.denverpost.com, onto a digital audio device, such as an iPod, and listened to on the go. Our ongoing involvement in the communities in which we operate not only strengthens our relationships with these communities but also provides our advertisers a superior vehicle for promoting their products or services. Although our focus is primarily on local news, we are committed to providing quality national and international news coverage when it is of particular interest to the local community.

     Our newspapers are designed to visually attract readers through attractive layouts and color enhancements and have received numerous awards from state press associations as well as other peer organizations for their editorial content, local news and sports coverage, and photography. The majority of our newspapers receive awards annually for excellence in various editorial categories in their respective regions and circulation size.

     Circulation Growth. We believe circulation growth is essential to maintaining and growing the long-term franchise value of our newspapers. Accordingly, we have and will continue to make significant investments in circulation promotion, telemarketing and other circulation growth campaigns to increase circulation and readership. Our circulation growth strategies are focused on growing home delivery and single copy sales, the most desired circulation types for our advertisers. We also design our management incentive programs to reward our publishers for circulation growth at their daily newspapers. Changes in the telemarketing rules, including the National Do-Not-Call Registry, are having an impact on our ability to gain subscriptions through telemarketing; however, we are not prohibited from calling those persons who are not registered with the registry or those persons who are, but with whom we have had a pre-existing relationship during the prior 18 months. Other home delivery circulation marketing programs are being implemented to offset the impact of the reduction in telemarketing orders. While growing circulation volumes is important, we continue to balance this with an eye on circulation profit by instituting programs that target the replacement of higher churn short-term circulation orders with lower cost, longer term circulation orders, thereby delivering a stable subscriber base for our advertising customers and controlling subscriber acquisition costs. In the past, this strategy has improved circulation profits, but in some cases decreased circulation home delivery volumes in the short-term. Throughout the industry, circulation has been a challenging area. According to an analysis completed by the Newspaper Association of America, the industry as a whole reported a decline in total circulation by 2.5% while Sunday declined by 3.1% for the six month period ending March 31, 2006 as compared to the same period a year ago. Sunday circulation at our newspapers declined by less than 1% after excluding Denver JOA and a few of our papers in the very competitive Los Angeles market where management made the decision to continue bringing circulation down. The individual paid circulation on Sunday for this same group increased by nearly 1%. We continue to implement technology to enhance demographic targeting of potential subscribers aimed at acquiring and retaining what our advertisers consider to be high quality subscribers. We have also started offering electronic replica editions to subscribers at several of our papers. This meets the needs of customers who prefer an electronic edition and also saves the cost of printing and delivering those newspapers.

     Cost Controls. We focus on cost control with particular attention on managing staffing requirements. At newspapers with collective bargaining agreements, management strives to enter into long-term agreements with small annual increases. In addition, we further control labor costs through investments in state-of-the-art production equipment that improve production quality and increase operating efficiency. Our investments, such as a new production and office facility in Salt Lake City and in Denver, not only will cut costs through the implementation of 48” web width and shorter cut-off on the new presses as well as lower staffing levels, but will also make significant improvements to the reproduction and color quality of the newspapers. The Salt Lake City facility became operational in the spring of 2006; the production facility in Denver is expected to be fully operational in January 2008.

     We are equally focused on newsprint cost control and are reducing the web width to 48” on the majority of our presses resulting in newsprint volume savings of 4%. In addition to volume savings, each of our newspapers benefits from the discounted newsprint pricing we obtain as one of the largest newspaper groups in the United States. We purchase newsprint from several suppliers under arrangements resulting in what we believe are some of the most favorable newsprint prices in the industry.

     Internet. MediaNews Group interactive (“MNGi”), our Internet subsidiary, drives the interactive media business of our Company and manages the centralized technology infrastructure that supports each of our local sites. Our strategy is to use the Internet and other electronic media to enhance and broaden our position as the leading provider of news, information and services in our local media markets. Our interactive operations are growing market share and extending the profitability of

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our local media franchises by leveraging our extensive newsgathering resources, print and online sales infrastructures and partnering with providers of emerging technologies and industry leaders, including Internet portals, broadband and wireless. We expect to extend the reach of our brands beyond our core and existing print audience to attract a younger and more diverse audience. Finally, we are cultivating relationships with new and existing advertisers by proactively addressing their needs by providing multimedia packages, among other things.

     We launched a significant new alliance with Yahoo! Hot Jobs which provides employers more visibility and distribution for their job postings and provides job seekers the most comprehensive database of employment listings in each of our local markets. This relationship with Yahoo! Hot Jobs allows us to offer the best value and cutting-edge products for both our advertisers and customers. We recently began exploring additional national distribution opportunities and platforms to increase the distribution of our advertising and news content while expanding the value we provide our customers online.

     To expand our direct sales channels, we are adding several comprehensive online self-service products to facilitate customer orders. We have also begun to implement next generation classified capabilities that we believe will result in more revenue per order, new revenue streams and significant cost savings. The development of these products will allow us to better compete with new entrants into online advertising and enhance advertiser satisfaction.

     Our search strategy launched in 2006 enables us to better understand the intent of our users and thus better deliver relevant content. In addition, we are introducing site registration and personalization across each of our sites, giving us the ability to integrate our online/offline databases to allow for a higher degree of online targeted marketing, including print subscription acquisitions, email marketing and the ability to target advertising based on the captured demographic and psychographic data.

     Finally, in 2007, we plan to launch a wireless strategy that will extend our ability to deliver our content to customers where, how and when they want it.

     By being the leading provider of local news and information in our markets and leveraging the Internet, electronic media, emerging wireless and broadband technologies, we believe that our newspapers are well positioned to respond to and benefit from changes in the way advertising, news and information are delivered to customers now and in the future. Links to our online newspapers can be found at www.newschoice.com.

     Superior Management. Our management team has a proven track record of successfully acquiring, including through partnerships, approximately 80 newspapers that have been successfully integrated into our operations. All of our senior executives have spent the majority of their careers in the newspaper industry operating, acquiring and integrating newspapers.

     Strategic Acquisitions. In the past we have sought to acquire newspapers that are contiguous to our existing newspapers and that represent compelling values based on expected operating cash flow growth from clustering synergies, efficiencies or otherwise. We may from time to time continue to evaluate and pursue strategic or targeted acquisitions and partnerships that meet our strict acquisition criteria, including our goal of not increasing our leverage ratio over the long term.

Advertising and Circulation Revenues

     Advertising is the largest component of a newspaper’s revenues, followed by circulation revenue. Advertising rates at each newspaper are established based upon market size, circulation, readership, demographic makeup of the market and the availability of alternative advertising media in the marketplace. While circulation revenue is not as significant as advertising revenue, circulation volume trends can impact the decisions of advertisers and advertising rates.

     Advertising revenue includes Retail (local and national department stores, specialty shops, preprinted advertising circulars and other local retailers, direct mail and niche publications), National (national brand advertising accounts), Classified advertising (employment, automotive, real estate and private party) and Interactive (online components of Retail, National and Classified Advertising). Other revenue consists primarily of revenue from commercial printing. The contributions of Retail, National, Classified, Interactive, Circulation and Other revenue to total revenues are shown in the following table.

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	Fiscal Years Ended
	June 30,(1)
	2006			2005			2004
Retail		42	%		42	%		42	%
National		6			6			6
Classified		27			26			27
Interactive		5			4			3
Circulation		16			17			17
Other		4			5			5
		100	%		100	%		100	%

(1) Generally accepted accounting principles do not allow us to consolidate the revenues for our JOA investments we do not control; accordingly, we record our share of the JOAs’ (Salt Lake City, Denver and Charleston through May 7, 2004) net results in one line item, “Income from Unconsolidated JOAs.” The revenue data for the JOAs we do not control (Salt Lake City, Denver, Charleston and Detroit) are excluded from this summary (see further discussion under Management’s Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Policies).

Newsprint

     Newsprint is one of the largest costs of producing a newspaper. We buy newsprint from several suppliers under arrangements that we believe provide us with some of the most favorable newsprint prices in the industry. Newsprint prices began increasing during fiscal year 2003 and this trend continued through fiscal year 2006. To combat this, we have begun implementing cost-cutting measures such as decreasing our newspapers to 48” web width and using lighter weight newsprint. During fiscal years 2006 and 2005, excluding our unconsolidated JOA operations, we consumed approximately 146,000 metric tons of newsprint, and in 2004 we consumed approximately 150,000 metric tons of newsprint. During fiscal years 2006, 2005 and 2004, we incurred newsprint expense of $83.6 million, $77.4 million and $72.8 million, respectively. Newsprint expense as a percentage of revenue from our newspaper operations (excluding unconsolidated JOAs) for fiscal years 2006, 2005 and 2004, was 10.1%, 9.9% and 9.8%, respectively. Our average price per metric ton was $574 during fiscal year 2006, compared to $528 and $485 during fiscal years 2005 and 2004, respectively. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Near Term Outlook — Newsprint Prices” for a discussion regarding current newsprint pricing trends.

Employee Relations

     As of June 30, 2006, we employed at our consolidated entities and unconsolidated JOAs in Denver and Salt Lake City approximately 8,400 full-time and 1,700 part-time employees, of which approximately 3,000 are unionized (approximately 1,800 of the total union employees are in Denver). There has never been a significant strike or work stoppage at any of our newspapers during our ownership, and we believe that our relations with our employees are generally good.

Seasonality and Cyclicality

     Newspaper companies tend to follow a distinct and recurring seasonal pattern, with higher advertising revenues in months containing significant events or holidays. Accordingly, the fourth calendar quarter, or our second fiscal quarter, is generally our strongest revenue quarter of the year. Due to generally poor weather and a lack of holidays, the first calendar quarter, or our third fiscal quarter, is generally our weakest revenue quarter of the year.

     Our advertising revenues, as well as those of the newspaper industry in general, are cyclical and dependent upon general economic conditions. Historically, advertising revenues have increased in periods of economic growth and declined with general national, regional and local economic downturns and recessionary economic conditions.

Competition

     Each of our newspapers competes for advertising revenue to varying degrees with magazines, yellow pages, radio, broadcast television and cable television, as well as with some weekly publications, direct mail and other advertising media,

10

including electronic media (Internet). Competition for newspaper advertising is largely based upon circulation, price and the content of the newspaper. Our suburban and small city daily newspapers are the dominant local news and information source, with strong brand name recognition and no direct competition from similar daily newspapers published in their markets. However, as with most suburban small city daily newspapers, some circulation competition exists from larger daily newspapers, which are usually published in nearby metropolitan areas.

     We believe larger metropolitan daily newspapers with circulation in our suburban newspaper markets generally do not compete in any meaningful way for local advertising revenues, a newspaper’s main source of revenues. Our suburban daily newspapers capture the largest share of local advertising as a result of their in-depth coverage of their suburban market, providing our readers with local stories and information that major metropolitan newspapers are unable or unwilling to provide. In addition, we believe advertisers generally regard newspaper advertising as a more effective method of advertising promotions and pricing as compared to television, which is generally used to advertise image.

     Most newspapers are now publishing news and advertising content on the Internet. In addition, there are many sites on the Internet, which are advertising and/or subscription supported. Many of these sites target specific types of advertising such as employment, real estate and automotive classified. Accordingly, we have invested and will continue to invest in our online strategy, which we believe allows us to capture our share of the locally available advertising dollars being spent on the Internet now and in the future.

Regulation and Environmental Matters

     Substantially all of our facilities are subject to federal, state and local laws concerning, among other things, emissions to the air, water discharges, handling and disposal of waste and remediation of contaminated sites. Compliance with these laws has not had, nor do we expect it to have, a material effect upon our capital expenditures, net income or competitive position. Although we believe we are in material compliance with these requirements, we may not have been and may not at all times be in complete compliance with all applicable requirements, and there can be no guarantee that we will not incur material costs, including fines or damages, resulting from non-compliance.

     Environmental laws and regulations and their interpretation have changed rapidly in recent years and may continue to do so in the future. These may include obligations to investigate and clean up environmental contamination on or from properties we currently own or formerly owned or operated, or at off-site locations where we are identified as a responsible party. Certain laws impose strict and, under certain circumstances, joint and several liability for investigation and clean-up costs. Environmental Assessment Reports of our properties have identified historic activities and conditions on certain of these properties, as well as current and historic uses of properties in surrounding areas, which may require further study or remedial measures. No material remedial measures are currently anticipated or planned by us with respect to our properties. However, no assurance can be given that existing Environmental Assessment Reports reveal all environmental liabilities, that any prior owner of our properties did not create an environmental condition not known to us, or that an environmental condition does not otherwise exist at any such property which could result in incurrence of material cost.

     Because we deliver certain newspapers by second-class mail, we are required to obtain permits from, and to file an annual statement of ownership with, the United States Postal Service.

Item 1A. Risk Factors

Advertising Revenues — We depend on advertising revenues that are affected by a number of factors, many of which are beyond our control.

     The primary source of our revenue is advertising. Our advertising revenues are affected by:

• the health of the economy in the areas where our newspapers are distributed and in the nation as a whole,

• the circulation of our newspapers,

• our editorial content,

• the demographic makeup of the population where our newspapers are distributed,

11

• fluctuations in our competitors’ price of advertising, and

• the activities of our competitors, including increased competition from other advertising mediums, including network, cable and satellite television, the Internet, radio and weekly newspapers.

Paid Circulation

     The newspaper publishing industry continues to experience some circulation decline with several factors contributing: (a) the ongoing impact of the federally imposed do-not-call lists (now three years old), which limits telemarketing of subscription home delivery sales; (b) the increased scrutiny of, and limitations on, the bulk/third-party sales that had been a source of circulation growth; (c) rule changes by the Audit Bureau of Circulation; and (d) the Internet, which creates competition for readers’ time and may not count as paid circulation if the reader is viewing our newspapers’ Web sites. We have taken steps to meet each of these challenges, including strengthening practices aimed at compliance with industry-wide accepted procedures in circulation reporting. Nonetheless, ongoing decline in paid circulation could have a material effect on the rate and volume of our advertising revenue.

Newsprint Costs — Increases in newsprint costs could adversely affect our financial results.

     Newsprint is a basic commodity and its price is sensitive to the worldwide balance of supply and demand. However, the demand for newsprint can change quickly, resulting in wide swings in its price. Increases in newsprint prices can adversely impact our financial results to the extent such increases are not offset by increased advertising revenues. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Near Term Outlook — Newsprint Prices.”

Competition — Competition could have a material adverse effect on us.

     Our revenue depends primarily upon the sale of advertising and, to a lesser degree, paid circulation. Our competitors for advertising and circulation include local and regional newspapers, magazines, yellow pages, radio and television broadcast, cable television, direct mail, electronic media (including the Internet) and other communications and advertising media which operate in our markets. Some of our competitors are larger and have greater financial resources than we do. The extent and nature of our competition in any particular newspaper market is in large part determined by the location and demographics of the market and the number of media alternatives in that market. Competition for newspaper advertising is largely based upon circulation, price, and the content of the newspaper.

Full Implementation of Operating Strategy — Failure to implement our operating strategy could have a material adverse effect on us.

     Our future financial performance and success are dependent in large part upon our ability to successfully implement our business strategy. We cannot assure you that we will be able to successfully implement our business strategy or be able to improve our operating results. In particular, we cannot assure you that we will be able to maintain circulation of our publications, obtain new sources of advertising revenues, generate additional revenues by building on the brand names of our publications or raise the cover or subscription prices of our publications without causing a decline in circulation.

Senior Management

     Our ability to maintain our competitive position is dependent on the services of our senior management team. If we were unable to retain the existing senior management personnel, develop future senior management within our company or attract other qualified senior management personnel, our business would be adversely affected.

Employee Benefits

     Health insurance costs have increased significantly faster than inflation on an annual basis over the past few years. We also anticipate that in the future, the cost of health care will continue to escalate, causing an increase to our expenses and employee contributions. If we are unable to negotiate favorable health insurance rates, it could adversely affect our results.

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Self-Insurance and Deductibles on Workers’ Compensation Insurance

     Under our workers’ compensation insurance program, we are responsible for the first $500,000 per occurrence; otherwise, we have statutory unlimited insurance coverage for workers’ compensation losses. The final cost of many of these claims may not be known for several years. We continuously review the adequacy of our insurance coverage, which we currently believe to be appropriate in light of the cost of insurance coverage and the type of risk being insured.

     The workers’ compensation insurance liability does not include the claims of our independent contractors. We believe these claims are covered under our general liability insurance (discussed below). However, if it is later determined that the independent contractors are covered under workers’ compensation insurance, our exposure (and liability) could be significantly greater than we have currently estimated.

Other Insurance Exposure, including Earthquake Coinsurance and Deductibles and Caps on General Liability, Property and Other Insurance Lines

     Our general liability, property and other insurance lines have deductibles ranging from $100,000 to $500,000. We also have specific earthquake coverage which has a deductible of the lesser of $250,000 per incident, or 5% of the value of the insured property. The maximum insured loss under the earthquake coverage is $70.0 million for our existing locations, and $25.0 million for the properties acquired in August 2006.

We are effectively controlled by two shareholder groups.

     William Dean Singleton, the Scudder family, and their respective family trusts, have the power to vote approximately 93% of our outstanding common stock. These shareholder groups are entitled to elect all of the members of our Board of Directors, and to otherwise control us, including decisions with respect to mergers, liquidations and asset acquisitions and dispositions. There are no independent directors on our Board. However, we are considering expanding the Board and possibly adding an independent director in the future, although there is no assurance such action will be taken.

We are not required to and may not comply with certain Board of Directors and Audit Committee requirements of the Sarbanes-Oxley Act of 2002.

     Our Board of Directors currently consists of four members: two members of the Scudder family, William Dean Singleton, our Chief Executive Officer, and Howell E. Begle, Jr., Of Counsel to Hughes Hubbard & Reed, LLP, which law firm is our counsel. The Board does not have a separate audit committee. No member of the Board has been elected, or is anticipated to be elected, to represent the interests of our creditors. However, we are considering expanding the Board and possibly adding an independent director in the future, although there is no assurance such action will be taken.

Our business could suffer if we are unsuccessful in negotiating new collective bargaining agreements.

     Portions of our workforce (and portions of the workforces at our JOAs) are represented by labor unions. The collective bargaining agreements covering these employees expire periodically. While we and our partners in our JOAs have in the past been successful in negotiating collective bargaining agreements on terms acceptable to us, and we believe that we and our partners currently have satisfactory relationships with labor unions and our employees who are represented by labor unions, no assurance can be given that we or our partners will be successful in any future negotiations with these unions. Currently, several of the collective bargaining agreements covering our employees and employees of our JOAs have expired. We or our JOAs, as applicable, and the employees that were covered by these agreements are currently continuing to operate under the terms of the expired agreements.

Substantial Leverage — Our substantial indebtedness could have a material adverse effect on our financial health and prevent us from fulfilling our obligations.

     We have a significant amount of indebtedness. Subject to the restrictions contained in our indebtedness agreements, we may incur additional indebtedness from time to time to finance acquisitions, to make capital expenditures, to fund working capital and for general business purposes.

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     Our substantial indebtedness could have important consequences. For example, it could:

• require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures or other general corporate purposes,

• impair our ability to obtain additional financing for, among other things, working capital, capital expenditures, acquisitions or other general corporate purposes, or

• limit our flexibility to adjust to changing business and market conditions, and make us more vulnerable to a downturn in general economic conditions as compared to our competitors that have any less debt.

     In addition, our failure to comply with the financial and other restrictive covenants contained in our indebtedness agreements could result in an event of default under such indebtedness, which, if not cured or waived, could have a material adverse effect on us. If we cannot meet or refinance our obligations when they are due, we may have to sell assets, reduce capital expenditures or take other actions, which could have a material adverse effect on us.

     We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us under our credit facility or otherwise in an amount sufficient to enable us to pay our indebtedness, or to fund our other liquidity needs. In addition, we may need to refinance all or a portion of our indebtedness, on or before maturity.

Item 1B. Unresolved Staff Comments

     Not applicable.

Item 2: Properties

     Our corporate headquarters are located in Denver, Colorado. The listing below of our production and operating facilities are, in most cases, complete newspaper production and office facilities, but the listing also includes television and radio stations. The principal production and operating facilities we own are located in:

Alaska	Minnesota	Texas	California
Anchorage	St. Paul (a)	El Paso	Vacaville	San Jose
		Graham	Paradise	Walnut Creek
Colorado	New Mexico		Hayward	Concord
Denver	Las Cruces	Utah	Pleasanton	Monterey (a)
	Carlsbad	Salt Lake City	Marin	West Covina
Connecticut	Farmington	Murray	Eureka	Valencia
Bridgeport	Alamogordo		Chico	Long Beach
		Vermont	Oroville	San Bernardino
Massachusetts	Pennsylvania	Brattleboro	Vallejo	Ontario
Pittsfield	York	Bennington	Lakeport	Woodland Hills
North Adams	Hanover		San Mateo	Redlands
Lowell	Lebanon		Woodland
Fitchburg	Chambersburg		Ukiah
Devens

(a) We manage these newspapers for The Hearst Corporation.

     Certain facilities located in Denver, Colorado and Long Beach, Oakland, Pasadena, Hayward and Pleasanton, California are operated under long-term leases.

     We believe that all of our properties are generally well maintained, in good condition and suitable for current operations. Our equipment is adequately insured.

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Item 3: Legal Proceedings

     MediaNews and Salt Lake City Tribune Publishing Company (“SLTPC”) continue to be involved in litigation over SLTPC’s option to acquire the assets used in connection with the operation and publication of The Salt Lake Tribune. We are also involved in other legal proceedings. See Note 11: Commitments and Contingencies of the consolidated financial statements for a description of the background of this litigation and other lawsuits.

Item 4: Submission of Matters to a Vote of Security Holders

     None.

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PART II

Item 5: Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities

     There were no equity securities sold by us during fiscal year 2006. There is no established public trading market for our common stock.

     As of June 30, 2006, there were approximately 9 record holders of our Class A Common Stock. No shares of Class B Common Stock are outstanding.

     We have never paid a cash dividend on our common stock. In conjunction with an investment by Hearst in the Company (if approved by the Department of Justice), we anticipate paying a dividend to the Class A shareholders of approximately $25.0 million with a portion of the proceeds from the Hearst investment. In addition, our long-term debt agreements contain covenants which, among other things, limit our ability to pay dividends to our shareholders.

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Item 6: Selected Financial Data

     The table below presents selected historical consolidated financial data.

     The following data should be read in conjunction with “Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K.

	MediaNews Group, Inc. & Subsidiaries
	Fiscal Years Ended June 30,
	2006			2005			2004			2003			2002
	(Dollars in thousands)
INCOME STATEMENT DATA(a):
Revenues
Advertising	$	660,389		$	610,060		$	582,689		$	570,163		$	545,715
Circulation		130,829			129,344			132,505			137,445			139,495
Other		44,658			39,875			38,635			30,990			25,920
Total Revenues		835,876			779,279			753,829			738,598			711,130
Income (Loss) from Unconsolidated JOAs		(23,298	)		23,291			22,207			25,227			8,770
Cost of Sales		260,939			242,653			234,784			221,888			220,082
Selling, General and Administrative		417,602			382,180			366,636			346,763			324,364
Depreciation and Amortization		44,067			40,598			40,742			40,553			47,545
Interest Expense		55,564			49,481			57,036			64,252			75,302
Gain on Sale of Newspaper Properties		1,129			114			6,982			28,797			—
Minority Interest		(35,033	)		(29,334	)		(32,237	)		(34,088	)		(32,218	)
Income Before Income Taxes		4,960			59,970			43,703			69,253			9,883
Net Income		1,077			39,880			26,737			38,312			12,365
CASH FLOW DATA:
Capital Expenditures	$	47,501		$	51,312		$	36,483		$	20,669		$	11,323
Cash Flows from:
Operating Activities(b)		71,508			92,944			76,455			89,759			66,629
Investing Activities (including Capital Expenditures)(b)		(64,454	)		(92,669	)		(20,534	)		(32,480	)		(18,002	)
Financing Activities		(10,892	)		(60,749	)		5,472			(55,965	)		(53,747	)
BALANCE SHEET DATA:
Total Assets	$	1,427,783		$	1,365,772		$	1,369,170		$	1,323,148		$	1,291,886
Long-Term Debt and Capital Leases		867,893			877,569			928,467			904,554			957,090
Other Long-Term Liabilities and Obligations		28,774			47,359			26,450			33,947			30,462
Putable Common Stock		40,899			48,556			—			—			—
Total Shareholders’ Equity		59,520			38,493			61,006			34,894			1,903
NON-GAAP FINANCIAL DATA (c):
Long-Term Debt and Capital Leases, Net(d)	$	882,833		$	875,512		$	863,094		$	897,998		$	945,551
Adjusted EBITDA	$	157,335		$	154,446		$	152,409		$	169,947		$	166,684
Minority Interest in Adjusted EBITDA		(46,541	)		(41,152	)		(45,747	)		(49,089	)		(45,946	)
Combined Adjusted EBITDA of Unconsolidated JOAs		27,909			38,097			39,842			40,371			36,006
EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company(e)		5,681			9,610			10,108			3,275			—
Adjusted EBITDA Available to Company	$	144,384		$	161,001		$	156,612		$	164,504		$	156,744

Footnotes on following two pages.

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Footnotes from previous page.

(a) Significant Transactions. The income statement data is impacted by the following significant transactions.

Acquisitions Fiscal Years 2002-2006
Year	Date	Publication	Location	Description	Purchase Price
2006	08/03/05	Detroit News	Detroit, Michigan	Daily morning newspaper	$  25.0 million
				(editorial only) and limited
				Detroit JOA partnership interest
		See Other Transactions (below) regarding the Prairie Mountain Publishing Company formation and Texas-New Mexico Newspapers Partnership restructuring
2005	01/04/05	The Park Record	Park City, Utah	Three times weekly newspaper	$  8.0 million
2004	01/05/04	Grunion Gazette and	Long Beach, California	Weekly newspapers	$  9.0 million
		Downtown Gazette
		See Other Transactions regarding the York JOA restructuring
2003	01/31/03	Paradise Post	Paradise, California	Three times weekly newspaper,	$  13.0 million
				plus commercial printing
	10/01/02	The Reporter	Vacaville, California	Daily morning newspaper	$  30.9 million
	10/01/02	Original Apartment	Los Angeles, California	Free distribution apartment rental	$  10.0 million,
		Magazine		magazine	plus $  4.9
					million in
					earnouts
2002	No significant acquisitions.

Dispositions Fiscal Years 2002-2006
Year
2006	No dispositions. See Other Transactions regarding the Prairie Mountain Publishing Company formation and Texas-New Mexico Newspapers Partnership restructuring.
2005	No dispositions.
2004	No significant dispositions. See Other Transactions regarding the Charleston JOA restructuring.
2003	No dispositions. See Other Transactions regarding the formation of Texas-New Mexico Newspapers Partnership.
2002	No dispositions.

Other Transactions Fiscal Years 2002-2006
Year	Description
2006	Effective February 1, 2006, we formed the Prairie Mountain Publishing Company (“PMP”) with E.W. Scripps (“Scripps”). Upon formation of PMP, we contributed substantially all of the operating assets of Eastern Colorado Publishing Company, comprised of several small daily and weekly newspapers, and Scripps contributed substantially all of the operating assets of the Daily Camera and the Colorado Daily, both published in Boulder, Colorado. In addition to the assets contributed to PMP, we paid Scripps $20.4 million to obtain our 50% interest in PMP.
	Effective December 26, 2005, we contributed assets of our four daily newspapers published in southern Pennsylvania (The Evening Sun (Hanover), the Lebanon Daily News and our interest in the entity that publishes the York Daily Record and York Sunday News, which will continue to be published under the terms of a joint operating agreement along with The York Dispatch) and Gannett contributed assets of the Public Opinion, published in Chambersburg, PA into the Texas-New Mexico Newspapers Partnership. As a result of the contributions (our ownership percentage went from 33.8% to 59.4%) and amended and restated partnership agreement, we are now the controlling partner and accordingly began consolidating the results of the Texas-New Mexico Newspapers Partnership effective December 26, 2005.
2005	In June 2005, we purchased the remaining 20% of The Denver Post Corporation which we did not own for $45.9 million.
2004	In May 2004, we restructured our interest in Charleston Newspapers (“Charleston JOA”). In exchange for $55.0 million (net of certain adjustments) and a limited partnership interest in a newly formed entity, Charleston Newspapers Holdings, L.P., we contributed our general partnership interest in the Charleston JOA and the masthead of the Charleston Daily Mail to Charleston Newspapers Holdings, L.P. Our limited partnership interest does not entitle us to any share of the profits or losses of the limited partnership. We recorded a pre-tax gain of $8.0 million as a result of this transaction.
	Effective April 30, 2004, we restructured our interest in the York JOA through the exercise of our call option to acquire the remaining interest in The York Newspaper Company and the masthead of the York Daily Record for approximately $38.3 million.
2003	Effective March 3, 2003, we formed the Texas-New Mexico Newspapers Partnership with Gannett. We contributed assets of our daily newspapers published in New Mexico (Las Cruces Sun-News, The Daily Times (Farmington), Carlsbad Current-Argus, Alamogordo Daily News and The Deming Headlight) and Gannett contributed the El Paso Times. Upon formation, we recognized in fiscal year 2003 a non-monetary pre-tax gain of $28.8 million and began accounting for our 33.8% interest in the partnership under the equity method of accounting.
2002	None.

Footnotes continue on following page.

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Footnotes from previous page (continued).

(b)	Prior Year Revision/Reclassification. For comparability certain prior year balances have been reclassified to conform to current reporting classifications. In particular, the statements of cash flows have been revised for the years ended June 30, 2005, 2004, 2003 and 2002 to reclassify the distribution of net income from equity investments from net cash flows from investing activities to net cash flows from operating activities and to reflect distributions in excess of net income from unconsolidated JOAs and equity investments as cash flows from investing activities in accordance with Statement of Financial Accounting Standards No. 95, Statement of Cash Flows. For the years ended June 30, 2005, 2004, 2003 and 2002, the revision increased (decreased) the reported net cash flows from investing activities by $6.0 million, ($1.3) million, $12.9 million and $6.0 million, respectively, with an offsetting change in net cash flows from operating activities.
(c)	Non-GAAP Financial Data. The Non-GAAP Financial Data presented, including Adjusted EBITDA and Adjusted EBITDA Available to Company, are not measures of performance recognized under GAAP. However, we believe that they are indicators and measurements of our leverage capacity and debt service ability. Adjusted EBITDA and Adjusted EBITDA Available to Company should not be considered as an alternative to measure profitability, liquidity, or performance, nor should they be considered an alternative to net income, cash flows generated by operating, investing or financing activities, or other financial statement data presented in our consolidated financial statements. Adjusted EBITDA is calculated by deducting cost of sales and SG&A expense from total revenues. Adjusted EBITDA Available to Company is calculated by: (i) reducing Adjusted EBITDA by the minorities’ interest in the Adjusted EBITDA generated from the California Newspapers Partnership, the Texas-New Mexico Newspapers Partnership (beginning December 26, 2005), The Denver Post Corporation (through June 10, 2005), and The York Newspaper Company (through April 30, 2004), our less than 100% owned subsidiaries (“Minority Interest in Adjusted EBITDA”); (ii) increasing Adjusted EBITDA by our combined proportionate share of the Adjusted EBITDA generated by our unconsolidated JOAs in Denver, Salt Lake City and through May 7, 2004, Charleston (“Combined Adjusted EBITDA of Unconsolidated JOAs”); and (iii) increasing Adjusted EBITDA by our proportionate share of EBITDA from the Texas-New Mexico Newspapers Partnership (through December 25, 2005) and our proportionate share of EBITDA of the Prairie Mountain Publishing Company (beginning February 1, 2006) (see footnote e). See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Reconciliation of GAAP and Non-GAAP Financial Information.”
(d)	Long-Term Debt and Capital Leases, Net as shown is net of cash and minority interest in cash and long-term debt and includes our share of long-term debt and capital leases in unconsolidated JOAs.

	Years Ended June 30,
	2006			2005			2004			2003			2002
	(Dollars in thousands)
Long-Term Debt and Capital Leases per Balance Sheet	$	867,893		$	877,569		$	928,467		$	904,554		$	957,090
Less: Cash per Balance Sheet		(424	)		(4,262	)		(64,736	)		(3,343	)		(2,029	)
Less: Minority Interest Share of Cash and Long-Term Debt and Capital Leases		(846	)		(216	)		(2,829	)		(7,414	)		(13,789	)
Add: Our share of Long-Term Debt and Capital Leases in Unconsolidated JOAs, net of minority interest		16,210	(1)		2,421	(1)		2,192			4,201			4,279
Total	$	882,833		$	875,512		$	863,094		$	897,998		$	945,551

(1)

Excludes our share of the Denver JOA lease (related to the construction of a new building) of approximately $41.7 million and $18.4 million at June 30, 2006 and 2005, respectively, which we expect will be terminated in the second quarter of our fiscal year 2007.

(e)

EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company. The Texas-New Mexico Newspapers Partnership and the Prairie Mountain Publishing Company agreements require the partnerships to make distributions equal to the earnings of the partnership before depreciation and amortization (EBITDA). From March 3, 2003 through December 25, 2005, our 33.8% share of the EBITDA of Texas-New Mexico Newspapers Partnership and beginning February 1, 2006, our 50% share of the EBITDA of Prairie Mountain Publishing Company, have been included in Adjusted EBITDA Available to Company as they are an integral part of our cash flow from operations defined by our debt covenants. Beginning December 26, 2005, we became the controlling partner of the Texas-New Mexico Newspapers Partnership at which time we began consolidating its results. See Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership and Note 5: Acquisitions, Dispositions and Other Transactions of the notes to the consolidated financial statements of this Annual Report on Form 10-K for further discussion of the Texas-New Mexico Newspapers Partnership restructuring and the Prairie Mountain Publishing Company formation.

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Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations

Introduction

     The following analysis of the financial condition and results of operations should be read in conjunction with Item 6: Selected Financial Data and the consolidated financial statements of MediaNews Group, Inc. and the notes thereto appearing elsewhere in this Annual Report on Form 10-K.

Company Overview

     We are in the business of publishing daily and weekly newspapers and Internet Web sites related thereto. Our newspapers derive their revenues primarily from advertising and circulation. Our primary operating expenses (before depreciation and amortization) are employee compensation, newsprint, marketing and distribution. In addition to our newspaper and related Internet operations, we own radio stations in Graham and Breckenridge, Texas and a CBS affiliate television station in Anchorage, Alaska. However, for the fiscal year ended June 30, 2006, the combined revenues of these non-newspaper operations were not significant to our operations as they comprised less than 1.0% of our consolidated revenue.

     Newspaper revenues tend to follow a distinct and recurring seasonal pattern, with higher advertising revenues in months containing significant events or holidays. Accordingly, the fourth calendar quarter, or our second fiscal quarter, is generally our strongest revenue quarter of the year. Due to generally poor weather and lack of holidays, the first calendar quarter, or our third fiscal quarter, is generally our weakest revenue quarter of the year.

     Our advertising revenues, as well as those of the newspaper industry in general, are cyclical and dependent upon general economic conditions. Historically, advertising revenues have increased in periods of economic growth and declined during national, regional and local economic downturns.

Critical Accounting Policies

     The preparation of financial statements in accordance with generally accepted accounting principles at times requires the use of estimates and assumptions. We make our estimates, based on historical experience, actuarial studies and other assumptions, as appropriate, to assess the carrying values of assets and liabilities and disclosure of contingent matters. We re-evaluate our estimates on an ongoing basis. Actual results could differ from these estimates. Critical accounting policies for us include revenue recognition; accounts receivable allowances; recoverability of our long-lived assets, including goodwill and other intangible assets, which are based on such factors as estimated future cash flows and current fair value estimates; pension and retiree medical benefits, which require the use of various estimates concerning the work force, interest rates and plan investment return, and involve the use of advice from consulting actuaries; and reserves for the self-insured portion of our workers’ compensation programs, which are based on such factors as claims growth and also involve advice from consulting actuaries. Our accounting for federal and state income taxes is sensitive to interpretation of various laws and regulations and the valuation of deferred tax assets. The notes to our consolidated financial statements included later in this Annual Report on Form 10-K contain a more complete discussion of our significant accounting policies.

     Advertising revenue is earned and recognized when advertisements are published, inserted, aired or displayed and are net of provisions for estimated rebates, rate adjustments and discounts. Circulation revenue includes home delivery subscription revenue, single copy and third party sales. Single copy revenue is earned and recognized based on the date the publication is delivered to the single copy outlet, net of provisions for returns. Home delivery subscription revenue is earned and recognized when the newspaper is sold and delivered to the customer or sold to a home delivery independent contractor. Amounts received in advance of an advertising run date or newspaper delivery are deferred and recorded on the balance sheet as a current liability (“Unearned Income”) and recognized as revenue when earned.

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     The operating results of our unconsolidated JOAs (Denver, Salt Lake City and, through May 7, 2004, Charleston) are reported as a single net amount in the accompanying financial statements in the line item “Income from Unconsolidated JOAs.” This line item includes:

• Our proportionate share of net income from JOAs,

• The amortization of subscriber lists created by the original purchase, as the subscriber lists are attributable to our earnings in the JOAs, and

• Editorial costs, miscellaneous revenue received outside of the JOA, and other charges incurred by our consolidated subsidiaries directly attributable to providing editorial content and news for our newspapers party to a JOA.

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Operating Results

     We have provided below certain summary historical consolidated financial data for fiscal years 2006, 2005 and 2004, in each case including the percentage change between periods.

	Summary Historical Financial Data
	Fiscal Years Ended June 30,
										2006 vs.			2005 vs.
	2006			2005			2004			2005			2004
	(Dollars in thousands)
INCOME STATEMENT DATA:
Total Revenues	$	835,876		$	779,279		$	753,829			7.3	%		3.4	%
Income (Loss) from Unconsolidated JOAs		(23,298	)		23,291			22,207			(d	)		4.9
Cost of Sales		260,939			242,653			234,784			7.5			3.4
Selling, General and Administrative		417,602			382,180			366,636			9.3			4.2
Depreciation and Amortization		44,067			40,598			40,742			8.5			(0.4	)
Interest Expense		55,564			49,481			57,036			12.3			(13.2	)
Other (Income) Expense, Net		1,440			8,669			17,365			(83.4	)		(50.1	)
Total Costs and Expenses		779,612			723,581			716,563			7.7			1.0
Equity Investment Income, Net		5,898			10,201			9,485			(42.2	)		7.5
Gain on Sale of Newspaper Properties		1,129			114			6,982			(d	)		(d	)
Minority Interest		(35,033	)		(29,334	)		(32,237	)		19.4			(9.0	)
Net Income		1,077			39,880			26,737			(d	)		(d	)
CASH FLOW DATA:
Cash Flows from:
Operating Activities(a)	$	71,508		$	92,944		$	76,455
Investing Activities(a)		(64,454	)		(92,669	)		(20,534	)
Financing Activities		(10,892	)		(60,749	)		5,472
NON-GAAP FINANCIAL DATA (b):
Adjusted EBITDA	$	157,335		$	154,446		$	152,409			1.9	%		1.3	%
Minority Interest in Adjusted EBITDA		(46,541	)		(41,152	)		(45,747	)		13.1			(10.0	)
Combined Adjusted EBITDA of Unconsolidated JOAs		27,909			38,097			39,842			(26.7	)		(4.4	)
EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company (c)		5,681			9,610			10,108			(40.9	)		(4.9	)
Adjusted EBITDA Available to Company	$	144,384		$	161,001		$	156,612			(10.3	)%		2.8	%

(a)	Prior Year Revision/Reclassification. For comparability, certain prior year balances have been reclassified to conform to current reporting classifications. In particular, the statements of cash flows have been revised for the years ended June 30, 2005 and 2004 to reclassify the distribution of earnings from equity investments from net cash flows from investing activities to net cash flows from operating activities and to reflect distributions in excess of net income from unconsolidated JOAs and equity investments as cash flows from investing activities in accordance with Statement of Financial Accounting Standards No. 95, Statement of Cash Flows. For the year ended June 30, 2005, the revision increased the reported net cash flows from investing activities and decreased the reported net cash flows from operating activities by $6.0 million. For the year ended June 30, 2004, the revision decreased the reported net cash flows from investing activities and increased the reported net cash flow from operating activities by $1.3 million.
(b)	Non-GAAP Financial Data. Adjusted EBITDA and Adjusted EBITDA Available to Company are not measures of performance recognized under GAAP. However, we believe that they are indicators and measurements of our leverage capacity and debt service ability. Adjusted EBITDA and Adjusted EBITDA Available to Company should not be considered as an alternative to measure profitability, liquidity, or performance, nor should they be considered an alternative to net income, cash flows generated by operating, investing or financing activities, or other financial statement data presented in our consolidated financial statements. Adjusted EBITDA is calculated by deducting cost of sales and SG&A expense from total revenues. Adjusted EBITDA Available to Company is calculated by: (i) reducing Adjusted EBITDA by the minorities’ interest in the Adjusted EBITDA generated from the California Newspapers Partnership, the Texas-New Mexico Newspapers Partnership (beginning December 26, 2005), The Denver Post Corporation (through June 10, 2005) and The York Newspaper Company (through April 30, 2004), our less than 100% owned consolidated subsidiaries (“Minority Interest in Adjusted EBITDA”); (ii) increasing Adjusted EBITDA by our combined proportionate share of the Adjusted EBITDA generated by our unconsolidated JOAs in Denver, Salt Lake City and through May 7, 2004, Charleston (“Combined Adjusted EBITDA of Unconsolidated JOAs”); and (iii) increasing Adjusted EBITDA by our proportionate share of EBITDA from the Texas-New Mexico Newspapers Partnership (through December 25, 2005) and our proportionate share of EBITDA of the Prairie Mountain Publishing Company (beginning February 1, 2006) (see footnote c). See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Reconciliation of GAAP and Non-GAAP Financial Information.”
(c)	The Texas-New Mexico Newspapers Partnership Agreement and Prairie Mountain Publishing Company. The Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company agreements require the partnership to make distributions equal to the earnings of the partnership before depreciation and amortization (EBITDA). Through December 25, 2005, our 33.8% share of the EBITDA of Texas-New Mexico Newspapers Partnership and beginning February 1, 2006, our 50% share of the EBITDA of Prairie Mountain Publishing Company have been included in Adjusted EBITDA Available to Company as they are an integral part of our cash flows from operations as defined by our debt covenants. Beginning December 26, 2005, we became the controlling partner of the Texas-New Mexico Newspapers Partnership at which time we began consolidating its results. See Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership and Note 5: Acquisitions, Dispositions and Other Transactions of the notes to the consolidated financial statements of this Annual Report on Form 10-K for further discussion of the Texas-New Mexico Newspapers Partnership restructuring and the Prairie Mountain Publishing Company formation.
(d)	Not meaningful.

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Summary Supplemental Non-GAAP Financial Data

     Joint operating agencies, or JOAs, represent an operating structure that is unique to the newspaper industry. Prior to EITF 00-1 “Balance Sheet and Income Statement Display under the Equity Method of Investments in Certain Partnerships and Other Unincorporated Joint Ventures,” which eliminated the use of pro-rata consolidation except in the extractive and construction industries, we reported the results of our JOA interests on a pro-rata consolidated basis. Under this method, we consolidated, on a line-item basis, our proportionate share of the JOAs’ operations. Although pro-rata consolidation is no longer considered an acceptable method for our financial reporting under GAAP, we believe it provides a meaningful presentation of the results of our operations and the amount of operating cash flow available to meet our debt service and capital expenditure requirements. Our JOA agreements in Denver and Salt Lake City do not restrict cash distributions to the owners and in general our Denver and Salt Lake City JOAs make monthly distributions. We use pro-rata consolidation to internally evaluate our performance and present it here because our bank credit agreement and the indentures governing our senior subordinated notes define cash flows from operations for covenant purposes using pro-rata consolidation. We also believe financial analysts and investors use the pro-rata consolidation and the resulting Adjusted EBITDA, combined with capital spending requirements, and leverage analysis to evaluate our performance. This information should be used in conjunction with GAAP performance measures in order to evaluate our overall prospects and performance. Net income determined using pro-rata consolidation is identical to net income determined under GAAP.

     In the table below, we have presented the results of operations of our JOAs in Denver and Salt Lake City, York through April 30, 2004, and Charleston through May 7, 2004 using pro-rata consolidation, including the percentage change between periods (the operations of the Charleston JOA subsequent to May 7, 2004 and the Detroit JOA have not been included on a pro-rata consolidation basis). See Notes 2 and 3 to the consolidated financial statements for additional discussion of the GAAP accounting for our JOAs.

THE INFORMATION IN THE FOLLOWING TABLE IS NOT PRESENTED IN ACCORDANCE WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND DOES NOT COMPLY WITH ARTICLE 11
OF REGULATION S-X FOR PRO FORMA FINANCIAL DATA

	Summary Selected Non-GAAP Financial Data
	Fiscal Years Ended June 30,
										2006 vs.			2005 vs.
	2006			2005			2004			2005			2004
	(Dollars in thousands)
PRO-RATA CONSOLIDATED INCOME STATEMENT DATA:
Total Revenues	$	1,132,423		$	1,081,754		$	1,049,851			4.7	%		3.0	%
Cost of Sales		381,763			362,456			355,808			5.3			1.9
Selling, General and Administrative		565,416			526,755			508,656			7.3			3.6
Depreciation and Amortization		92,261			54,021			55,453			70.8			(2.6	)
Interest Expense		55,827			49,679			57,258			12.4			(13.2	)
Other (Income) Expense, Net		4,190			9,854			19,225			(57.5	)		(48.7	)
Total Costs and Expenses		1,099,457			1,002,765			996,400			9.6			0.6
Gain on Sale of Newspaper Properties		1,129			114			6,982			(c	)		(c	)
Minority Interest		(35,033	)		(29,334	)		(26,215	)		19.4			11.9
Net Income		1,077			39,880			26,737			(c	)		(c	)
CASH FLOW DATA (GAAP BASIS):
Cash Flows from:
Operating Activities(a)	$	71,508		$	92,944		$	76,455
Investing Activities(a)		(64,454	)		(92,669	)		(20,534	)
Financial Activities		(10,892	)		(60,749	)		5,472
PRO-RATA OTHER DATA(b):
Adjusted EBITDA	$	185,244		$	192,543		$	185,387			(3.8	)%		3.9	%
Minority Interest in Adjusted EBITDA		(46,541	)		(41,152	)		(38,883	)		13.1			5.8
EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company		5,681			9,610			10,108			(40.9	)		(4.9	)
Adjusted EBITDA Available to Company	$	144,384		$	161,001		$	156,612			(10.3	)%		2.8	%

(a)	See footnote (a) under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Operating Results” for discussion of Prior Year Revision/Reclassification.
(b)	See footnote (b) under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Operating Results” for discussion of Adjusted EBITDA, EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company and Adjusted EBITDA Available to Company. The Minority Interest in Adjusted EBITDA shown is calculated the same as described in footnote (b) under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Operating Results” except that Minority Interest in Adjusted EBITDA shown here on a pro-rata basis includes only the minority interest in Adjusted EBITDA of the California Newspapers Partnership and The Denver Post Corporation (through June 10, 2005), as pro-rata consolidation factors out of the minority interest associated with The York Newspaper Company through April 30, 2004. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Reconciliation of GAAP and Non-GAAP Financial Information.”
(c)	Not meaningful.

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Fiscal Year 2006 Executive Overview

     In fiscal year 2006, we continued to grow advertising revenue. We saw growth in national, preprint, employment and real estate classified advertising in most of our markets. While advertising revenue grew, circulation revenue declined slightly. The trend of significant growth in Internet advertising revenue continued as Internet-related revenues increased 38.4% in fiscal year 2006, after adjusting for acquisitions and dispositions. The Internet is a critical element of our overall strategy to expand our audience by delivering news and information to a larger, more diverse and younger audience, which in turn allows our advertising customers to take advantage of our expanded market reach.

     During fiscal year 2006, newsprint and employee benefit costs, two of our largest expenses, continued their trend from fiscal year 2005 and increased at a higher rate as compared to other operating expenses. Excluding our unconsolidated JOAs, our average cost per metric ton of newsprint increased almost 8.7% in fiscal year 2006 and 8.9% in fiscal year 2005, which correspondingly increased cost of sales by $4.6 million and $5.5 million during the respective fiscal years. Reduced consumption associated with decreases in retail advertising volumes, a shift to preprint advertising from advertising printed in the newspaper, and small circulation declines helped to somewhat offset the impact of newsprint price increases. Employee benefit costs were driven by increases in health care costs and post-retirement benefits. Health care costs across the United States continued to increase during fiscal year 2006. Pension and other post retirement benefit costs increased due to increases in assumed health care costs and lower discount rates. We also saw increased spending related to our Internet initiatives. We continue to maintain tight cost controls throughout our organization and seek to identify areas where further cost control measures can be implemented.

Transactions

     Our current year results were also impacted by the following transactions completed during fiscal year 2006:

• In August 2005, we purchased The Detroit News, Inc. which included a limited partnership interest in the Detroit JOA.

• In September 2005, we amended our bank credit facility to refinance a portion of our long-term debt and reduce certain interest rate margins charged under the bank credit facility.

• Effective December 26, 2005, we restructured the Texas-New Mexico Newspapers Partnership whereby we contributed to the partnership our Pennsylvania newspapers: The Evening Sun (Hanover), the Lebanon Daily News and our interest in the partnership that publishes the York Daily Record and York Sunday News, which continues to operate under the terms of a joint operating agreement along with The York Dispatch. Gannett, our partner in the Texas-New Mexico Newspapers Partnership, contributed the Public Opinion in Chambersburg, PA. As a result of the contributions and amendment and restatement of the partnership agreement, the Texas-New Mexico Newspapers Partnership became a 59.4%-owned consolidated subsidiary of ours.

• In February 2006, the Prairie Mountain Publishing Company was formed after which we no longer consolidate the results of Eastern Colorado Publishing Company and account for our investment in Prairie Mountain Publishing Company under the equity method of accounting. We own 50% of Prairie Mountain Publishing Company.

     In addition to the fiscal year 2006 transactions described above, certain transactions in fiscal years 2005 and 2004 had an impact on the comparisons of our results for the years ended June 30, 2006, 2005 and 2004.

     In fiscal year 2005, transactions that affect comparisons include the following:

• In January 2005, we purchased The Park Record published in Park City, Utah.

• We took advantage of the lower interest rates available to us in both the bond and bank financing markets by refinancing a portion of our long-term debt. We amended and refinanced a portion of our bank credit facility in August 2004 to take advantage of lower borrowing margins. We also retired $200.0 million of our 8 5/8% bonds in July 2004 with proceeds of our January 2004 issuance of $150.0 million 6 3/8% bonds and cash on hand.

• In June 2005, we purchased the 20% of The Denver Post Corporation which we did not own for approximately $45.9 million.

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     In fiscal year 2004, transactions that affect comparisons include the following:

• We restructured our interest in the Charleston JOA in exchange for $55.0 million in cash and recorded a pre-tax gain of $8.0 million. We also restructured our interest in The York Newspaper Company through the exercise of our option to buy out the minority partner’s interest and purchase the masthead of the York Daily Record for $38.3 million using a portion of the proceeds from the Charleston Newspapers restructuring.

• In January 2004, we purchased two weekly newspapers: the Grunion Gazette and Downtown Gazette. These weeklies are distributed in and around Long Beach, California, where we own the daily newspaper.

• We launched IMPACTO USA, a Spanish-language publication in the Los Angeles market that is home delivered on Saturdays to 250,000 targeted households.

• We took advantage of the lower interest rates available to us in both the bond and bank financing markets by refinancing the majority of our long-term debt. This included refinancing our $300.0 million 8 3/4% bonds due in 2009 with $300.0 million of our 6 7/8% bonds due in 2013 and refinancing our bank credit facility in December 2003, to take advantage of lower borrowing margins and increase the amount available under our revolving credit facility. We also sold $150.0 million of our 6 3/8% bonds in anticipation of the retirement of $200.0 million of our 8 5/8% bonds, which was accomplished in July 2004.

Comparison of Fiscal Years Ended June 30, 2006 and 2005

Revenues

     On a same newspaper basis (after adjusting for the aforementioned fiscal year 2005 Park City acquisition, the fiscal year 2006 Detroit acquisition, Texas-New Mexico Newspapers Partnership restructuring and Prairie Mountain Publishing Company formation), the following changes occurred in our significant revenues categories for the year ended June 30, 2006 as compared to the prior year.

     Advertising Revenues. Advertising revenues increased by approximately 1.7% for the year ended June 30, 2006 as compared to the prior year. The increase in advertising revenue was due principally to increases in national and preprint advertising categories, as well as increases in revenues from our Internet operations, offset in part by a decrease in retail (ROP, run of press) advertising. The classified advertising category remained relatively flat with increases in classified employment and classified real estate being offset by decreases in classified automotive.

     Circulation Revenues. Circulation revenues decreased 4.9% for the year ended June 30, 2006 as compared to the prior year. The decrease was primarily due to home delivery pricing pressures at most of our newspapers, which resulted in our offering greater discounts to acquire new and retain existing subscribers, in order to help achieve our home delivery volume goals.

Income from Unconsolidated JOAs

     As noted in our discussion of critical accounting policies, income from unconsolidated JOAs (Denver and Salt Lake City) includes our proportionate share of net income from those JOAs, the amortization of subscriber lists created by the original purchase, editorial costs, miscellaneous revenue and other charges directly attributable to providing editorial content and news for newspapers party to a JOA. The following discussion takes into consideration all of the associated revenues and expenses described above. The results for the year ended June 30, 2006 were negatively impacted by the accelerated depreciation taken on certain fixed assets at production facilities in Denver and Salt Lake City which have been or will be retired earlier than originally expected due to the construction or completion of new production facilities at their respective locations. Excluding depreciation and amortization which were significantly impacted by the effect of accelerated depreciation, income from unconsolidated JOAs in Denver and Salt Lake City was down approximately $11.8 million or 32.2% compared to the prior year. The results of the Denver JOA were negatively impacted by a soft advertising market combined with higher newsprint prices, increased circulation, promotion and delivery costs, and increased employee benefit costs. Excluding the impact of the accelerated depreciation, the results of the Salt Lake City JOA were relatively flat year over year. While the Salt Lake City JOA experienced many of the same operating expense increases that the Denver JOA did, its advertising revenue gains mostly kept pace with these expense increases.

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Cost of Sales

     The purchase of The Park Record in fiscal year 2005, the December 2005 Texas-New Mexico Newspapers Partnership restructuring and the February 2006 formation of Prairie Mountain Publishing Company had the net impact of increasing cost of sales by $12.9 million for the year ended June 30, 2006 as compared to the prior year. Excluding these transactions, cost of sales increased 2.3%. The increase was driven by an 8.7% increase in newsprint prices as compared to the same period in prior year. Our average price of newsprint was $574 per metric ton for the year ended June 30, 2006 as compared to $528 per metric ton for the prior year. Increases in newsprint prices were offset in part by decreases in newsprint consumption of approximately 4.4% for the year ended June 30, 2006. Also impacting cost of sales were increased costs in our production and mailroom departments related to commercial printing and increased preprint volumes.

Selling, General and Administrative

     The purchase of The Park Record in fiscal year 2005, the December 2005 Texas-New Mexico Newspapers Partnership restructuring and the February 2006 formation of Prairie Mountain Publishing Company had the net impact of increasing SG&A by $20.4 million for the year ended June 30, 2006 as compared to the prior year. Excluding these transactions, SG&A increased 3.9%. The current year increases were primarily the result of increases in employee costs, including health care and retirement benefits, as well as increased costs associated with circulation promotion and delivery (primarily fuel due to increased gas prices), and increased costs related to the growth in our advertising revenues and Internet operations. Expenses related to our Internet operations increased $5.0 million for the year ended June 30, 2006 as compared to the prior year, which was more than offset by Internet revenue growth of 38.4%.

Interest Expense

     The increase in interest expense was the result of an increase in the average debt outstanding, as well as an increase in the weighted average cost of debt. Significant borrowings impacting the year over year comparison related to the August 3, 2005 purchase of our interest in the Detroit JOA, the June 10, 2005 purchase of the remaining 20% of The Denver Post Corporation which we did not own, funding for our share of the cost of the new production and office facility built in Salt Lake City, and the cash investment associated with the formation of the Prairie Mountain Publishing Company. For the year ended June 30, 2006, our average debt outstanding increased $34.9 million, or 4.0%, and our weighted average interest rate increased 64 basis points as compared to the prior year.

Other (Income) Expense, Net

     We include expenses and income items that are not related to current operations in other (income) expense, net.

     The charges incurred for the year ended June 30, 2006 relate to litigation expense of $1.3 million associated with the acquisition of Kearns-Tribune, LLC (Salt Lake City), $0.8 million related to hedging and investing activities that did not qualify for hedge accounting under SFAS No. 133, $(2.0) million related to our contractual return on our investment in the Detroit JOA, $0.2 million in bank fees and $1.1 million associated with various other items that were not related to ongoing operations.

Equity Investment Income, Net

     Included in equity investment income, net is our share of the net income (or loss) of our non-JOA equity investees as further described in Note 2: Significant Accounting Policies and Other Matters of the notes to consolidated financial statements. The $4.3 million decrease in equity investment income, net is largely due to the December 25, 2005 restructuring of the Texas-New Mexico Newspapers whereby as a result of the restructuring, we no longer account for our interest in the Texas-New Mexico Newspapers Partnership under the equity method of accounting and instead consolidate the partnership’s results.

Net Income

     Net income for fiscal year 2006 was negatively impacted by the loss from unconsolidated JOAs which was caused by the accelerated depreciation taken on certain fixed assets at production facilities in Denver and Salt Lake City which have

26

been or will be retired earlier than originally expected due to the construction or completion of new production facilities at their respective locations. Excluding the impact of accelerated depreciation at the Denver and Salt Lake JOAs, pre-tax net income declined $6.8 million. Our effective tax rate was 78% for the year ended June 30, 2006, as compared to 34% for the year ended June 30, 2005. The effective tax rate was higher in fiscal year 2006 due to the contribution of our eastern Colorado newspapers to Prairie Mountain Publishing Company which caused a change in how we account for the related book/tax basis differences, an increase in the valuation allowances for state tax NOL carryforwards, and recurring non-deductible expenses that had a larger impact on the effective income tax rate in fiscal year 2006 due to lower pre-tax book income in fiscal year 2006 compared to the prior year.

Comparison of Fiscal Years Ended June 30, 2005 and 2004

Revenues

     On a same newspaper basis (after adjusting for the aforementioned fiscal year 2005 Park City and fiscal year 2004 Gazette transactions), the following changes occurred in our significant revenues categories for the year ended June 30, 2005 as compared to the prior year.

     Advertising Revenues. Advertising revenues increased by approximately 4.1% for the year ended June 30, 2005 as compared to the prior year. The increase in advertising revenue was due principally to increases in national of 6.1%, classified of 3.7% and preprints of 9.6%, as well as a $7.8 million or 40.5% increase in revenues from our Internet operations, offset in part by a small decrease in retail ROP (run of press) advertising of 1.9%. The growth in preprint revenues was due to a trend of major retail advertisers shifting from ROP advertising and into preprint advertising. For the year ended June 30, 2005, employment and real estate classified advertising increased at the majority of our newspapers. These gains, however, were somewhat offset by declines in classified automotive advertising.

     Circulation Revenues. Circulation revenues decreased by approximately 3.0% for the year ended June 30, 2005 as compared to the prior year. The decrease was primarily due to pricing pressures at some of our newspapers, as well as competition from other non-newspaper media sources, which resulted in greater discounts in order to acquire new and retain existing subscribers and help achieve our home delivery volume goals.

Income from Unconsolidated JOAs

     As noted in our discussion of critical accounting policies, income from unconsolidated JOAs (Denver, Salt Lake City, and through May 7, 2004, Charleston) includes our proportionate share of net income from those JOAs, the amortization of subscriber lists created by the original purchase, editorial costs, miscellaneous revenue and other charges directly attributable to providing editorial content and news for our newspapers party to a JOA. The following discussion takes into consideration all of the associated revenues and expenses described above. The aforementioned Charleston restructuring had the net impact of decreasing income from unconsolidated JOAs by $1.3 million for the year ended June 30, 2005. Excluding the impact of the Charleston restructuring, the increase for the year ended June 30, 2005 was due to improved net income at both the Denver and Salt Lake JOAs.

Cost of Sales

     The aforementioned purchase of The Park Record in fiscal year 2005, the fiscal year 2004 York restructuring and weekly newspaper purchases had the net impact of increasing cost of sales by $3.8 million for the year ended June 30, 2005, as compared to the prior year. Excluding these transactions, cost of sales for the year increased 1.7%. The current year increase in cost of sales was due in part to an 8.9% increase in our average price per metric ton of newsprint consumed for the year ended June 30, 2005, as compared to the prior year. Our average price was approximately $528 per metric ton for the year ended June 30, 2005, as compared to $485 per metric ton for prior year. Partially offsetting the impact of higher newsprint prices was a small decrease in our newsprint consumption.

Selling, General and Administrative

     The transactions described above had the net impact of increasing SG&A by $2.7 million for the year ended June 30, 2005, as compared to the prior year. Excluding these transactions, SG&A increased 3.5%. The current year increase was primarily the result of increases in employee costs, including health care and retirement benefits, the curtailment of a pension plan at one of our subsidiaries, as well as increased costs directly associated with the growth in our advertising revenues and Internet operations. Expenses related to our Internet operations increased $2.1 million, or 15.0%, for the year ended June 30, 2005.

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Interest Expense

     Interest expense for fiscal year 2005 decreased $7.6 million as a result of a $48.4 million, or 5.3% reduction, in our average debt outstanding to $864.9 million, as well as a 42 basis point reduction in our weighted average interest rate to 5.59%. The lower weighted average cost of debt was a result of the November 2003 refinancing of our 8 3/4% Senior Subordinated Notes with our 6 7/8% Senior Subordinated Notes, the restructuring of our bank credit agreement (December 2003 and August 2004) and the July 2004 repurchase of our 8 5/8% Senior Subordinated Notes funded out of proceeds from our 6 3/8% Senior Subordinated Notes (issued in January 2004) and borrowings from our bank credit facility. Savings from our various refinancing efforts were offset in part by increases in LIBOR over the prior year (the average daily one month rate for LIBOR increased 125 basis points, for the year ended June 30, 2005 as compared to the same period in prior year). The interest rates under our bank credit facility are based on LIBOR, plus a borrowing margin based on our leverage ratio. Interest expense was also favorably impacted in the prior year by net settlements related to our interest rate swap agreements. The net settlements of our interest rate swap agreements had the effect of decreasing interest expense by $3.0 million for the year ended June 30, 2004. We had no interest rate swap agreements during fiscal year 2005. Excluding the impact of the interest rate swaps in the prior year, our weighted average interest rate decreased by approximately 74 basis points for the year ended June 30, 2005.

Other (Income) Expense, Net

     We include expenses and income items that are not related to current operations in other (income) expense, net. We incurred charges for the year ended June 30, 2005 related to litigation expense of $0.8 million associated with the acquisition of Kearns-Tribune, LLC (Salt Lake City), $(5.8) million reduction in the estimated cost to repurchase an option held by a third party to acquire one of our newspapers, $9.2 million of repurchase premiums and unamortized discount associated with the early redemption of our 8 5/8% Senior Subordinated Notes, $0.4 million related to hedging activities that did not qualify for hedge accounting under SFAS No. 133, $0.7 million in bank fees and $3.4 million related to various other costs that were not related to ongoing operations.

Equity Investment Income, Net

     Included in equity investment income, net is our share of the net income (or loss) of our non-JOA equity investees as further described in Note 2: Significant Accounting Policies and Other Matters of the notes to consolidated financial statements. The $0.7 million increase in equity investment income, net was primarily related to an increase in equity income from PowerOne mostly due to a gain on sale recognized by PowerOne from the sale of one of its product lines. Operating results also improved at CIPS. The increases at PowerOne and CIPS were partially offset by decreases in income from our other equity investments.

Net Income

     Net income for fiscal year 2005 was negatively impacted by $9.2 million for redemption premiums and unamortized discounts associated with the early redemption of our 8 5/8% Senior Subordinated Notes. Excluding the $9.2 million loss on early extinguishment of debt, pre-tax net income was $69.2 million for the year ended June 30, 2005. Prior year pre-tax income was impacted by $9.3 million for redemption premiums, net of unamortized premiums, that were recorded as a result of redeeming our 8 3/4% Senior Subordinated Notes and a $7.0 million pre-tax gain on sale of newspaper assets, primarily associated with the Charleston newspapers restructuring. Excluding the $9.3 million loss on early extinguishment of debt and the $7.0 million pre-tax gain on sale, pre tax net income was $46.0 million for the year ended June 30, 2004. Our effective tax rate was 34% for the year ended June 30, 2005, as compared to 39% for the year ended June 30, 2004.

Liquidity and Capital Resources

     Our sources of liquidity are cash and other working capital, cash flows provided from operating activities, distributions from JOAs and partnerships and the borrowing capacity under our bank credit facility. Our operations, consistent with the newspaper industry, require little investment in inventory, as less than 30 days of newsprint is generally maintained on hand; however, from time to time, we increase our newsprint inventories in anticipation of price increases. In general, our receivables have been collected on a timely basis.

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Cash Flow Activity

     The decrease in net cash flows from operating activities of $21.4 million for the year ended June 30, 2006, was largely attributable to a $12.6 million increase in distributions paid to minority interests, a $32.0 million decrease in distributions of net income from unconsolidated JOAs and equity investments, offset in part by a $29.8 million change in cash flows from operating assets and liabilities due to timing.

     The net cash outflows related to investing activities decreased by $28.2 million. The significant changes between fiscal year 2006 and 2005 are as follows. In fiscal year 2006, we had combined investments of $47.9 million related to the Detroit JOA, Prairie Mountain Publishing Company, and other small investments, as compared to combined investments of $58.6 million in the prior year (primarily the purchase of the remaining minority interest in The Denver Post Corporation and the Park City acquisition). In addition, the fiscal year 2006 change was impacted by a net $13.8 million increase in distributions in excess of net income from unconsolidated JOAs, equity investments and other unconsolidated subsidiaries, and a $3.8 million decrease in capital expenditures. However, total cash distributions from unconsolidated JOAs (components of operating and investing cash flows) decreased by $15.1 million year over year. Approximately $15.3 million of the 2006 capital expenditures are related to our share of the cost of a new printing and office facility being constructed for the Salt Lake City JOA. In addition, capital expenditures for the year ended June 30, 2006 include expenditures related to the construction of a new building in San Bernardino, California and the ongoing project to implement new advertising and circulation systems company-wide.

     The net cash outflows related to financing activities decreased by $49.9 million for the year ended June 30, 2006. Activity included normal borrowings and paydowns on long-term debt, as well as borrowings to finance the purchases of our interest in the Detroit JOA, our 50% interest in the Prairie Mountain Publishing Company and to fund our share of the new production and office facility in Salt Lake City, contributions related to certain equity investments and refinancing costs of the September 8, 2005 amended credit facility. Excluding the aforementioned items we paid down debt of approximately, $70.1 million for the year ended June 30, 2006. In addition to normal borrowings and paydowns on long-term debt, prior period activity included using cash on hand and available borrowings under the revolver portion of our credit facility to repurchase all of our outstanding 8 5/8% Senior Subordinated Notes for $208.6 million (including $8.6 million of repurchase premiums).

Capital Expenditures

	Capital Expenditures
	Fiscal Year 2007 Plan										Fiscal Year 2006 Actual
	(Dollars in thousands)
	Wholly-		Non Wholly-			Our Share of					Wholly-		Non Wholly-			Our Share of
	Owned		Owned			Unconsolidated					Owned		Owned			Unconsolidated
	Subsidiaries		Subsidiaries			JOAs		Total			Subsidiaries		Subsidiaries			JOAs		Total
Total Capital Projects	$	24,262	$	14,448		$	17,930	$	56,640		$	32,496	$	15,005		$	16,858	$	64,359
Less Minority Partners’ Share		—		(6,441	)		—		(6,441	)		—		(6,817	)		—		(6,817	)
	$	24,262	$	8,007		$	17,930	$	50,199		$	32,496	$	8,188		$	16,858	$	57,542

     Non-maintenance expenditures planned for fiscal year 2007 include costs for leasehold improvements and furniture and fixtures related to Corporate and our Internet group’s move, a redundant data center as well as other infrastructure software and equipment for our Internet group, and certain production facility improvements and various other technology infrastructure improvements throughout the Company. Carryover expenditures from the prior year of which our share (net of minority interest) is approximately $12.5 million are primarily for new Company-wide advertising and circulation systems, front-end editorial systems for the Alameda Newspapers Group and our share of remaining costs related to the new printing and office facility in Salt Lake City. Planned expenditures related to our share of unconsolidated JOAs include the new production and office facilities in Denver. Management reviews the capital expenditure plan throughout the year and adjusts it as required to meet our current business needs and performance. Capital expenditures related to these projects are expected to be funded either through available cash or borrowings under our bank credit facility. The capital expenditures plan above excludes the capital budget for our August 2, 2006 acquisitions (see Note 16: Subsequent Events for further discussion of the acquisition).

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Liquidity at June 30, 2006

     On April 26, 2006, we entered into a Stock and Asset Purchase Agreement (the “MediaNews Purchase Agreement”) with The McClatchy Company (“McClatchy”) pursuant to which we agreed to purchase the Contra Costa Times and the San Jose Mercury News and related publications and Web sites for $736.8 million. We consummated such purchase from McClatchy on August 2, 2006 through the California Newspapers Partnership, a 54.23% owned subsidiary. Our cash portion of the acquisition, including fees, was approximately $403.0 million and was funded with borrowings from our revolver and proceeds from a new term loan “C” of our amended bank credit facility. The acquisition, including fees, was funded in part with contributions of $340.1 million from our partners in the California Newspapers Partnership. See further discussion regarding term loan “C” below.

     On April 26, 2006, The Hearst Corporation (“Hearst”) and McClatchy entered into a Stock and Asset Purchase Agreement (the “Hearst Purchase Agreement”) pursuant to which Hearst agreed to purchase The Monterey County Herald and the St. Paul Pioneer Press and related publications and Web sites for $263.2 million. Hearst and McClatchy consummated such purchase on August 2, 2006. On August 2, 2006, we entered into an agreement with Hearst (the “MediaNews/Hearst Agreement”) pursuant to which (i) Hearst agreed to make an equity investment in us of up to $299.4 million (subject to adjustment under certain circumstances). Such investment will not include any governance or economic rights or interest in our publications in the San Francisco Bay Area and (ii) we agreed to purchase from Hearst The Monterey County Herald and the St. Paul Pioneer Press with a portion of the proceeds from the Hearst equity investment. The equity investment will afford Hearst an equity interest of approximately 30% (subject to adjustment in certain circumstances) in our publications outside the San Francisco Bay area. Hearst will also be provided certain approval rights with respect to our publications outside the San Francisco Bay area. The equity investment by Hearst in the Company is subject to regulatory approval, and a review is currently underway by the Antitrust Division of the Department of Justice. The Antitrust Division has requested information and documents in connection with this review, and we are in the process of responding to this request. We have agreed to manage The Monterey County Herald and the St. Paul Pioneer Press during the period of ownership by Hearst, with us retaining all the net cash flows from these newspapers as a management fee. We have also agreed that at the election of MediaNews or Hearst, we will purchase The Monterey County Herald and the St. Paul Pioneer Press from Hearst for $263.2 million (plus reimbursement of Hearst’s cost of funds in respect of its purchase of such newspapers) if for any reason Hearst’s equity investment in us is not consummated within six months, which may be extended by agreement of both parties. We would need to obtain additional financing to fund this purchase, if required. We will consolidate the financial statements of these two properties commencing August 2, 2006. If necessary, we currently intend to fund the purchase of the St. Paul Pioneer Press and The Monterey County Herald through equity investments from other sources or debt issued by a newly formed holding company that would be the parent company of MediaNews. Proceeds from The Monterey County Herald contribution to CNP or separate Stephens partnership would also be available to fund the Hearst purchase.

     On April 26, 2006, we entered into an agreement with Gannett and S.F. Holding Corporation (the “Stephens/Gannett Contribution Agreement”) pursuant to which Gannett and S.F. Holding Corporation (“Stephens”) will contribute their pro rata share of the purchase price (plus estimated transaction fees and expenses) of The Monterey County Herald, for a total ranging between approximately $27.4 million and $38.4 million, depending on whether The Monterey County Herald is purchased by the California Newspapers Partnership or a partnership between us and Stephens, to be owned 67.36% by us and 32.64% by Stephens.

     On June 30, 2006, our debt structure included our amended and restated bank credit facility which provides for borrowings of up to $597.3 million, consisting of a $350.0 million revolving credit facility, a $100.0 million term loan “A” and a $147.3 million term loan “B.” Any payments on the term loans cannot be reborrowed, regardless of whether such payments are scheduled or voluntary. On June 30, 2006, the balances outstanding under the revolving credit portion of the bank credit facility, term loan “A” and term loan “B” were $146.6 million, $100.0 million and $145.8 million, respectively, and we had $193.0 million available for future borrowings, net of $10.4 million in outstanding letters of credit.

     In July 2006, we sold our office building in Long Beach, California for approximately $20.0 million. We expect to recognize a gain on the sale of the building. In conjunction with the sale of our building, we entered into a 15-year lease agreement for space to house our Long Beach operations. The lease term commences once the new space is ready to be occupied, which is expected to be in the second quarter of our fiscal year 2007. Expected minimum lease payments are as follows: fiscal years 2007 through 2009 — $0.8 million per year; fiscal years 2010 through 2011 — $0.9 million per year; and thereafter — $10.5 million cumulatively.

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     On August 2, 2006, we amended our existing bank credit facility. The amendment was entered into in order to create a new $350.0 million term loan “C” facility and to authorize us to purchase the Contra Costa Times, San Jose Mercury News, The Monterey County Herald and the St. Paul Pioneer Press. The amended facility maintains the $350.0 million revolving credit facility, the $100.0 million term loan “A,” the $147.3 million term loan “B” and provides for the $350.0 million term loan “C” facility which was borrowed on August 2, 2006 and used to pay our portion of the purchase price for the Contra Costa Times and the San Jose Mercury News along with the additional borrowings under our revolving credit facility. The term loan “C” bears interest based upon, at the Company’s option, Eurodollar, plus a borrowing margin of 1.75%, or base rate, plus a borrowing margin of 0.75%. The term loan “C” requires quarterly principal payments as follows: $0.875 million through June 2012; and $82.25 million from June 2012 through March 2013, with the remaining balance due at maturity on August 2, 2013. Amounts repaid under term loan “C” are not available for re-borrowing.

     In September 2005, the management committee of the Denver JOA authorized the incurrence of up to $150.0 million of debt by the Denver JOA to finance furniture, fixtures and computers for its new building and new presses and related equipment and building costs related to the consolidation of two existing production facilities into one for the Denver JOA. We own a 50% interest in the Denver JOA. As of June 30, 2006, our share of the debt incurred by the Denver JOA for the items mentioned was approximately $14.0 million. See “Off-Balance Sheet Arrangements” for further information regarding our share of long-term debt in Denver.

     In January 1998, we entered into an option agreement in association with the acquisition financing of one of our newspaper properties. This option provides the holder the right to purchase the assets used in the publication of the newspaper, which the option holder can exercise or put such option to us based on a predetermined formula anytime after January 31, 2003. The option repurchase price at June 30, 2006 is valued at approximately $6.6 million, and is recorded as a component of other long-term liabilities. If the option were put to us, we expect to fund the payment with available borrowings from our bank credit facility. As a result, in accordance with SFAS No. 6, Classification of Short-Term Obligations Expected to be Refinanced, the option repurchase price remains classified in our balance sheet as long-term. If the option is not exercised, we must repurchase it on January 30, 2010.

     S.F. Holding Corporation (“Stephens”), a 26.28% partner in the California Newspapers Partnership (“CNP”), has a right to require CNP to redeem its interest in CNP at its fair market value (plus interest through closing) any time after January 1, 2005. If such right is exercised, Stephens’ interest must be redeemed within two years of the determination of its fair market value. We are not currently aware of any intentions on the part of Stephens to exercise its put. No amounts are recorded in our financial statements related to Stephens’ put right.

     Our ability to service our debt and fund planned capital expenditures depends on our ability to continue to generate operating cash flows in the future. Based on current levels, we believe our cash flow from operations, available cash and available borrowings under our bank credit facility will be adequate to meet our future liquidity needs for at least the next twelve months.

     We estimate minimum contributions to our defined benefit pension plans in fiscal year 2007 will be approximately $8.5 million to $9.0 million (including the required contributions for the plans assumed in conjunction with our August 2, 2006 acquisition). We expect federal income tax payments to significantly increase next year because of the impact of alternative minimum taxes.

Distributions from Partnerships

     Set forth below is a description of the ownership structure and earnings-distribution provisions of our Denver, Salt Lake City and Detroit JOAs, as well as the CNP, the Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company partnership agreements:

• Through our wholly-owned subsidiary, Kearns-Tribune, LLC, we own a 50% interest in the Salt Lake City JOA. Under the agreement, 58% of the Salt Lake City JOA’s net income, less their working capital needs and other minor adjustments, is paid to Kearns-Tribune, LLC and is distributed (generally) weekly.

• Through our wholly-owned subsidiary, The Denver Post Corporation, we own 50% of The Denver Newspaper Agency, LLP. Under the Denver Newspaper Agency JOA agreement, the partnership is required to distribute 50% of

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	its monthly EBITDA (and other funds available for distribution), less working capital required by the partnership and payments under its separate credit agreements, to The Denver Post Corporation.
•	Through our wholly-owned subsidiary, The Detroit News, Inc., we own a limited partnership interest in Detroit Newspaper Partnership, L.P. Under the Detroit JOA agreement, the partnership is required to make fixed preferred distributions to us monthly, as well as reimburse us for our news and editorial costs. The fixed preferred distributions are as follows: $5.0 million for years 2006 and 2007; $4.0 million for years 2008 and 2009; $3.0 million for years 2010 and 2011; $2.0 million for the year 2012; and $1.9 million for all remaining years. Beginning in 2009, we may receive incremental distributions based on profit growth of the Detroit JOA.
•	Through our wholly-owned subsidiary, West Coast MediaNews LLC, we own a 54.23% interest in the California Newspapers Partnership (“CNP”). Under the terms of the partnership agreement, we are entitled to monthly distributions of the partnership’s EBITDA in proportion to our partnership interest, less working capital required and debt service payments (total CNP debt, excluding the debt and capital leases we contributed to the partnership, is $1.2 million at June 30, 2006 of which our share is $0.7 million).
•	Through our wholly-owned subsidiary, New Mexico-Texas MediaNews LLC, we own a 59.4% interest in the Texas-New Mexico Newspapers Partnership. Pursuant to the partnership agreement, the partnership management committee is required to determine the amount of earnings (before depreciation and amortization) or other partnership funds available for distribution for each accounting period and distribute (generally monthly) 59.4% of such funds to New Mexico-Texas MediaNews LLC.
•	Through our wholly-owned subsidiary, Eastern Colorado Publishing Company, we own 50% of the Prairie Mountain Publishing Company. Under the Prairie Mountain Publishing Company partnership agreement, monthly distributions equal to 50% of EBITDA (and other funds available for distribution), less working capital required by the partnership, are required to be made to Eastern Colorado Publishing Company.

Off-Balance Sheet Arrangements

     Our share of long-term debt in unconsolidated JOAs (Denver) was approximately $16.2 million at June 30, 2006 (excludes approximately $41.7 million at June 30, 2006 for our share of the Denver JOA construction lease related to a new building to consolidate the Denver JOA operations). We expect the Denver JOA will terminate the construction lease in the second quarter of our fiscal year 2007.

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Contractual Obligations

     The following table represents our contractual obligations as of June 30, 2006:

			Less than						More than
	Total		1 Year		1-3 Years		3-5 Years		5 Years
	(Dollars in thousands)
Long-Term Debt(1)	$	861,923	$	3,926	$	41,843	$	356,459	$	459,695
Capital Lease Obligations, Net of Imputed Interest		5,970		207		519		645		4,599
Operating Leases		41,135		6,865		10,655		4,147		19,468
Purchase Obligations(2)		116,922		41,972		56,492		15,243		3,215
Other Long-Term Liabilities Reflected on the Balance Sheet under GAAP(3)		28,774		—		2,496		9,406		16,872
Total	$	1,054,724	$	52,970	$	112,005	$	385,900	$	503,849

(1) Does not reflect our August 2, 2006 amended credit facility which provided for a new term loan “C.” Maturities related to the new term loan “C” facility are as follows: Fiscal years 2007 through 2011 — $3.5 million each year; and thereafter — $329.0 million.

(2) Purchase obligations primarily include commitments to purchase newsprint. One of our newsprint contracts requires us to purchase newsprint at market. For purposes of this disclosure we used the market price as of June 2006. It is difficult to predict the price of newsprint over the term of the contract.

(3) Reflected on the balance sheet in Other Liabilities (long-term) at June 30, 2006 is $6.6 million related to the amount accrued to repurchase an option held by a third party to purchase the assets used in the publication of one of our newspaper properties. The option was exercisable beginning in January 2003; however it is included in Other Liabilities (long-term) because if the option is put to us, we expect to fund the payment with available borrowings from our bank credit facility.

Near Term Outlook

Newsprint Prices

     Newsprint suppliers last announced a price increase for August 2006. However, the timing and amount of the price increase has and continues to vary widely among newsprint purchasers and suppliers, and we believe that such increase is unlikely to hold. The August 2006 RISI (“Resource Information Systems, Inc.”) price index for 30 pound newsprint was $663 per metric ton compared to $612 per metric ton in August 2005. As a large buyer of newsprint, our cost of newsprint continues to be below the RISI price index.

Recently Issued Accounting Standards

     See Note 2: Significant Accounting Policies and Other Matters — Recently Issued Accounting Standards, of the notes to our consolidated financial statements.

Reconciliation of GAAP and Non-GAAP Financial Information

     The following tables have been provided to reconcile the Non-GAAP financial information (Adjusted EBITDA and Pro-Rata Consolidated Income Statement Data) presented in the “Selected Consolidated Financial Data,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of this annual report on Form 10-K to their most directly comparable GAAP measures (Cash Flows from Operating Activities and GAAP Income Statement Data).

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     Reconciliation of Cash Flows from Operating Activities (GAAP measure) to Adjusted EBITDA (non-GAAP measure).

	Years Ended June 30,
	2006			2005			2004			2003			2002
	(Dollars in thousands)
NON-GAAP FINANCIAL DATA(a)
Cash Flows from Operating Activities (GAAP measure)	$	71,508		$	92,944		$	76,455		$	89,759		$	66,629
Net Change in Operating Assets and Liabilities		(4,132	)		25,678			20,126			8,619			459
Distributions Paid to Minority Interest		40,782			28,167			36,176			38,765			43,406
Distributions of Net Income from Unconsolidated JOAs		(44,120	)		(71,878	)		(66,828	)		(66,326	)		(50,995	)
Distributions of Net Income from Equity Investments		(5,228	)		(9,511	)		(9,676	)		(4,360	)		(1,448	)
Interest Expense		55,564			49,481			57,036			64,252			75,302
Bad Debt Expense		(9,893	)		(8,065	)		(7,405	)		(9,632	)		(10,213	)
Pension Income (Expense), Net of Cash Contributions		(2,427	)		(1,463	)		(1,082	)		(31	)		(1,172	)
Direct Costs of the Unconsolidated JOAs, Incurred Outside of the Unconsolidated JOAs(b)		46,318			44,286			42,352			39,226			35,367
Net Cash Related to Other (Income), Expense		8,963			4,807			5,255			9,675			9,349
Adjusted EBITDA		157,335			154,446			152,409			169,947			166,684
Minority Interest in Adjusted EBITDA		(46,541	)		(41,152	)		(45,747	)		(49,089	)		(45,946	)
Combined Adjusted EBITDA of Unconsolidated JOAs		27,909			38,097			39,842			40,371			36,006
EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company (c)		5,681			9,610			10,108			3,275			—
Adjusted EBITDA Available to Company	$	144,384		$	161,001		$	156,612		$	164,504		$	156,744

(a)	Non-GAAP Financial Data. Adjusted EBITDA and Adjusted EBITDA Available to Company are not measures of performance recognized under GAAP. However, we believe that they are indicators and measurements of our leverage capacity and debt service ability. Adjusted EBITDA and Adjusted EBITDA Available to Company should not be considered as an alternative to measure profitability, liquidity, or performance, nor should they be considered an alternative to net income, cash flows generated by operating, investing or financing activities, or other financial statement data presented in our consolidated financial statements. Adjusted EBITDA is calculated by deducting cost of sales and SG&A expense from total revenues. Adjusted EBITDA Available to Company is calculated by: (i) reducing Adjusted EBITDA by the minorities’ interest in the Adjusted EBITDA generated from the California Newspapers Partnership, the Texas-New Mexico Newspapers Partnership (beginning December 26, 2005), The Denver Post Corporation (through June 10, 2005) and The York Newspaper Company (through April 30, 2004), our less than 100% owned consolidated subsidiaries (“Minority Interest in Adjusted EBITDA”); (ii) increasing Adjusted EBITDA by our combined proportionate share of the Adjusted EBITDA generated by our unconsolidated JOAs in Denver, Salt Lake City and through May 7, 2004, Charleston (“Combined Adjusted EBITDA of Unconsolidated JOAs”); and (iii) increasing Adjusted EBITDA by our proportionate share of EBITDA of the Texas-New Mexico Newspapers Partnership (through December 25, 2005) and our proportionate share of EBITDA of the Prairie Mountain Publishing Company (beginning February 1, 2006) (see footnote (c)).
(b)	Direct Costs of Unconsolidated JOAs. Direct Costs of the Unconsolidated JOAs, Incurred Outside of the Unconsolidated JOAs includes the editorial costs, publishing related revenues, and other direct costs incurred outside of the JOAs by our consolidated subsidiaries associated with The Salt Lake Tribune, The Denver Post, and through May 7, 2004, the Charleston Daily Mail, but excludes depreciation and amortization and other expense not related to continuing operations as these costs are not included in Adjusted EBITDA. See Note 3: Joint Operating Agencies in the footnotes to our consolidated financial statements for further description and analysis of this adjustment.
(c)	The Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company. The Texas-New Mexico Newspapers Partnership agreement, effective March 3, 2003, and the Prairie Mountain Publishing Company agreement, effective February 1, 2006, require the partnerships to make distributions equal to the earnings of the partnership before depreciation and amortization (EBITDA). From March 3, 2003 through December 25, 2005, our 33.8% share of the EBITDA of Texas-New Mexico Newspapers Partnership and, beginning February 1, 2006, our 50% share of the EBITDA of Prairie Mountain Publishing Company have been included in Adjusted EBITDA Available to Company as they are an integral part of our cash flows from operations as defined by our debt covenants. Beginning December 26, 2005, we became the controlling partner of the Texas-New Mexico Newspapers Partnership at which time we began consolidating its results. See Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership and Note 5: Acquisitions, Dispositions and Other Transactions of the notes to the consolidated financial statements of this Form 10-K for further discussion of the Texas-New Mexico Newspapers Partnership restructuring and the Prairie Mountain Publishing Company formation.

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Reconciliation of Cash Flows from Operating Activities (GAAP measure) to Adjusted EBITDA presented on a pro-rata consolidated basis (non-GAAP measure).

	Years Ended June 30,
	2006			2005			2004
	(Dollars in thousands)
NON-GAAP FINANCIAL DATA(a)
Cash Flows from Operating Activities (GAAP measure)	$	71,508		$	92,944		$	76,455
Net Change in Operating Assets and Liabilities		(4,132	)		25,678			20,126
Distributions Paid to Minority Interest		40,782			28,167			36,176
Distributions of Net Income from Unconsolidated JOAs		(44,120	)		(71,878	)		(66,828	)
Distributions of Net Income from Equity Investments		(5,228	)		(9,511	)		(9,676	)
Interest Expense		55,564			49,481			57,036
Bad Debt Expense		(9,893	)		(8,065	)		(7,405	)
Pension Income Expense, Net of Cash Contributions		(2,427	)		(1,463	)		(1,082	)
Direct Costs of the Unconsolidated JOAs, Incurred Outside of the JOAs (c)		46,318			44,286			42,352
Combined Adjusted EBITDA of Unconsolidated JOAs(b)		27,909			38,097			39,842
Minority Interest in Adjusted EBITDA of the York Newspaper Company (d)		—			—			(6,864	)
Net Cash Related to Other (Income), Expense		8,963			4,807			5,255
Adjusted EBITDA		185,244			192,543			185,387
Minority Interest in Adjusted EBITDA		(46,541	)		(41,152	)		(38,883	)
EBITDA of Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company		5,681			9,610			10,108
Adjusted EBITDA Available to Company	$	144,384		$	161,001		$	156,612

(a)	Non-GAAP Financial Data. Adjusted EBITDA and Adjusted EBITDA Available to Company are not measures of performance recognized under GAAP. However, we believe that they are indicators and measurements of our leverage capacity and debt service ability. Adjusted EBITDA and Adjusted EBITDA Available to Company should not be considered as an alternative to measure profitability, liquidity, or performance, nor should they be considered an alternative to net income, cash flows generated by operating, investing or financing activities, or other financial statement data presented in our consolidated financial statements. Adjusted EBITDA is calculated by deducting cost of sales and SG&A expense from total revenues. Adjusted EBITDA Available to Company is calculated by: (i) reducing Adjusted EBITDA by the minorities’ interest in the Adjusted EBITDA generated from the California Newspapers Partnership, the Texas-New Mexico Newspapers Partnership (beginning December 26, 2005), and The Denver Post Corporation (through June 10, 2005), our less than 100% owned consolidated subsidiaries (“Minority Interest in Adjusted EBITDA”) and (ii) increasing Adjusted EBITDA by our proportionate share of EBITDA of the Texas-New Mexico Newspapers Partnership and Prairie Mountain Publishing Company. Note that pro-rata consolidation already takes into account our share of the results from our unconsolidated JOAs and factors out the minority interest associated with The York Newspaper Company through April 30, 2004.
(b)	Combined Adjusted EBITDA of Unconsolidated JOAs. Combined Adjusted EBITDA of Unconsolidated JOAs is calculated as total revenues, less cost of sales and SG&A expense from the Unconsolidated JOAs Pro-Rata Adjustment column presented that follows under “— Reconciliation of Income Statement Data presented on a historical GAAP basis to Non-GAAP Income Statement Data presented on a pro-rata consolidation basis.”
(c)	Direct Costs of Unconsolidated JOAs. Direct Costs of the Unconsolidated JOAs, Incurred Outside of the Unconsolidated JOAs includes the editorial costs, publishing related revenues, and other direct costs incurred outside of the JOAs by our consolidated subsidiaries associated with The Salt Lake Tribune, The Denver Post, and through May 7, 2004 the Charleston Daily Mail, but excludes depreciation and amortization and other expense not related to continuing operations as these costs are not included in Adjusted EBITDA. See Note 3: Joint Operating Agencies in the footnotes to our consolidated financial statements for further description and analysis of this adjustment.
(d)	Minority Interest in Adjusted EBITDA of the York Newspaper Company. Minority Interest in Adjusted EBITDA of the York Newspaper Company through April 30, 2004 is calculated as total revenues, less cost of sales and SG&A expense from the Adjustment to Eliminate 42.5% Minority Interest in York JOA column presented that follows under “ — Reconciliation of Income Statement Data presented on a historical GAAP basis to Non-GAAP Income Statement Data presented on a pro-rata consolidation basis.”

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Reconciliation of Income Statement Data presented on a historical GAAP basis to Non-GAAP Income Statement Data presented on a pro-rata consolidation basis.

     See footnotes (1) and (2) at the end of these reconciliations for a description of the adjustments made. See footnote (a) on the preceding page for a description of our method of calculating Adjusted EBITDA. All amounts shown in the following reconciliations are in thousands.

	Year Ended June 30, 2006
				Unconsolidated
	As Presented			JOAs Pro-Rata		As Presented on
	Under GAAP			Adjustment(2)		a Pro-Rata Basis
Total Revenues	$	835,876		$	296,547	$	1,132,423
Loss from Unconsolidated JOAs		(23,298	)		23,298		—
Cost of Sales		260,939			120,824		381,763
Selling, General and Administrative		417,602			147,814		565,416
Depreciation and Amortization		44,067			48,194		92,261
Interest Expense		55,564			263		55,827
Other (Income) Expense, Net		1,440			2,750		4,190
Total Costs and Expenses		779,612			319,845		1,099,457
Gain on Sale of Newspaper Properties		1,129			—		1,129
Minority Interest		(35,033	)		—		(35,033	)
Net Income		1,077			—		1,077
Adjusted EBITDA(3)	$	157,335		$	27,909	$	185,244

	Year Ended June 30, 2005
				Unconsolidated
	As Presented			JOAs Pro-Rata			As Presented on
	Under GAAP			Adjustment(2)			a Pro-Rata Basis
Total Revenues	$	779,279		$	302,475		$	1,081,754
Income from Unconsolidated JOAs		23,291			(23,291	)		—
Cost of Sales		242,653			119,803			362,456
Selling, General and Administrative		382,180			144,575			526,755
Depreciation and Amortization		40,598			13,423			54,021
Interest Expense		49,481			198			49,679
Other (Income) Expense, Net		8,669			1,185			9,854
Total Costs and Expenses		723,581			279,184			1,002,765
Minority Interest		(29,334	)		—			(29,334	)
Net Income		39,880			—			39,880
Adjusted EBITDA(3)	$	154,446		$	38,097		$	192,543

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	Year Ended June 30, 2004
				Adjustment to
				Eliminate 42.5%			Unconsolidated
	As Presented			Minority Interest			JOAs Pro-Rata			As Presented on
	Under GAAP			in York JOA(1)			Adjustment(2)			a Pro-Rata Basis
Total Revenues	$	753,829		$	(15,280	)	$	311,302		$	1,049,851
Income from Unconsolidated JOAs		22,207			—			(22,207	)		—
Cost of Sales		234,784			(3,192	)		124,216			355,808
Selling, General and Administrative		366,636			(5,224	)		147,244			508,656
Depreciation and Amortization		40,742			(500	)		15,211			55,453
Interest Expense		57,036			(78	)		300			57,258
Other (Income) Expense, Net		17,365			(264	)		2,124			19,225
Total Costs and Expenses		716,563			(9,258	)		289,095			996,400
Gain on Sale of Newspaper Properties		6,982			—			—			6,982
Minority Interest		(32,237	)		6,022			—			(26,215	)
Net Income		26,737			—			—			26,737
Adjusted EBITDA(3)	$	152,409		$	(6,864	)	$	39,842		$	185,387

(1)	Adjustment to Eliminate 42.5% Minority Interest in York JOA. Eliminates The York Newspaper Company JOA minority partner’s 42.5% share from the individual line items with a corresponding adjustment to GAAP minority interest through April 30, 2004. Effective April 30, 2004, we acquired the minority interest in The York Newspaper Company. The difference between the minority interest adjustment provided in the reconciliation of Cash Flows from Operating Activities (GAAP measure) to Adjusted EBITDA presented on a pro-rata consolidated basis (non-GAAP measure) and the pro-rata minority interest adjustment above is that certain items (Depreciation and Amortization, Interest Expense and Other (Income) Expense, Net) are excluded from Minority Interest in Adjusted EBITDA.
(2)	Unconsolidated JOAs Pro-Rata Adjustment. The adjustment to pro-rata consolidate our unconsolidated JOAs includes our proportionate share, on a line item basis of the income statements of our unconsolidated JOAs. Our interest in the earnings of the Salt Lake City JOA is 58%, while our interests in Denver Newspaper Agency and Charleston Newspapers (through May 7, 2004) are 50%. This adjustment also includes the editorial costs, publishing related revenues, depreciation, amortization, and other direct costs incurred outside of the JOAs by our consolidated subsidiaries associated with The Salt Lake Tribune, The Denver Post, and the Charleston Daily Mail (through May 7, 2004). See Note 3: Joint Operating Agencies in the footnotes to our consolidated financial statements for further description and analysis of the components of this adjustment.
(3)	Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure.

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Item 7A: Quantitative and Qualitative Disclosures About Market Risk

     We are exposed to market risk arising from changes in interest rates associated with our bank debt, which includes our bank term loans and bank credit facility.

     The following table provides information about our debt obligations that are sensitive to changes in interest rates. The table presents principal cash flows and related weighted-average interest rates by expected maturity dates. Weighted-average variable rates are based on implied forward rates as derived from appropriate annual spot rate observations as of the reporting date.

Interest Rate Sensitivity
Principal or Notional Amount by Expected Maturity
Average Interest or Swap Rate

	Years Ended June 30,																					Fair Value 2006
	2007			2008			2009			2010			2011			Thereafter			Total			(Liability)
										(Dollars in thousands)
Liabilities
Long-Term Debt including Current Portion Fixed Rate	$	—		$	—		$	—		$	—		$	—		$	446,813		$	446,813		$	403,125
Average Interest Rate		8.64	%		8.64	%		8.64	%		8.64	%		8.64	%		8.64	%
Variable Rate	$	4,973		$	14,973		$	29,973		$	317,404		$	98,817		$	332,500		$	798,640		$	798,640
Average Interest Rate(c)		6.83	%		6.83	%		6.83	%		6.83	%		6.83	%		6.83	%
Total																			$	1,245,453	(a)

(a) The long-term debt (including current portion) of $1,245.4 million from the Market Risk table above differs from total long-term debt of $861.9 million reported in Note 6: Long-Term Debt of the notes to the consolidated financial statements due to the following (in millions):

$	1,245.4		Balance per table above
	22.8		(b)
	(406.3	)	(c)
$	861.9		Total per Note 6: Long-Term Debt

(b)	Relates to various notes payable due through 2013. The Market Risk table above excludes these long-term obligations as we could not practicably estimate fair value due to the lack of quoted market prices for these types of instruments and our inability to estimate the fair value without incurring the excessive costs of obtaining an appraisal.
(c)	Reflects our August 2, 2006 amended credit facility, which provided for a new $350.0 million term loan “C,” which we used along with borrowings under our revolver of $56.3 million to fund our August 2, 2006 acquisition. See Note 16: Subsequent Events of the notes to the consolidated financial statements for further discussion.

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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

     This Annual Report on Form 10-K includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements contained herein and elsewhere in this annual report on Form 10-K are based on current expectations. Such statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The terms “expect,” “anticipate,” “intend,” “believe,” and “project” and similar words or expressions are intended to identify forward-looking statements. These statements speak only as of the date of this Annual Report on Form 10-K. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results and events to differ materially from those anticipated and should be viewed with caution. Potential risks and uncertainties that could adversely affect our ability to obtain these results, and in most instances are beyond our control, include, without limitation, the following factors: (a) increased consolidation among major retailers, bankruptcy or other events that may adversely affect business operations of major customers and depress the level of local and national advertising, (b) an economic downturn in some or all of our principal newspaper markets that may lead to decreased circulation or decreased local or national advertising, (c) a decline in general newspaper readership patterns as a result of competitive alternative media or other factors, (d) increases in newsprint costs over the level anticipated, (e) labor disputes which may cause revenue declines or increased labor costs, (f) acquisitions of new businesses or dispositions of existing businesses, (g) costs or difficulties related to the integration of businesses acquired by us may be greater than expected, (h) increases in interest or financing costs, (i) rapid technological changes and frequent new product introductions prevalent in electronic publishing, including increased competition from Internet advertising and news sites and (j) other unanticipated events and conditions. It is not possible to foresee or identify all such factors. We make no commitment to update any forward-looking statement or to disclose any facts, events, or circumstances after the date hereof that may affect the accuracy of any forward-looking statements.

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Item 8: Financial Statements and Supplementary Data

     The response to this item is filed as a separate part of this report. See Item 15: Exhibits and Financial Statement Schedules.

Item 9: Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

     None

Item 9A: Controls and Procedures

     As of June 30, 2006, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer, President, and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 15d-15(e) of the Securities Exchange Act of 1934. Based upon that evaluation, the Chief Executive Officer, President, and Chief Financial Officer concluded that our disclosure controls and procedures were sufficiently effective to provide reasonable assurance that material information regarding us and/or our subsidiaries required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms. During the fourth quarter of our fiscal year 2006, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

     The Company’s management, including the CEO, President, and CFO, does not expect that our disclosure controls or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple errors or mistakes. Additionally, controls can be circumvented by the individual acts of some persons or by collusion of two or more people. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Item 9B: Other Information

     None

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PART III

Item 10: Directors and Executive Officers of the Registrant

     Set forth below are the names, ages and titles and a brief account of the business experience of each person who is a director, executive officer or other significant employee of ours.

Name	Age		Title
Richard B. Scudder		93	Chairman of the Board and Director
William Dean Singleton		55	Vice Chairman and Chief Executive Officer and Director
Joseph J. Lodovic, IV		45	President
Steven B. Rossi		57	Executive Vice President and Chief Operating Officer
Anthony F. Tierno		61	Senior Vice President of Operations
Eric J. Grilly		35	President, MediaNews Group Interactive; Senior Vice President MediaNews
Ronald A. Mayo		45	Vice President and Chief Financial Officer
James L. McDougald		53	Treasurer
Michael J. Koren		39	Vice President and Controller
Steven M. Barkmeier		45	Vice President Tax
Elizabeth A. Gaier		41	Senior Vice President of New Business Development
Charles M. Kamen		58	Vice President Human Resources
David M. Bessen		52	Vice President and Chief Information Officer
Patricia Robinson		64	Secretary
Jean L. Scudder		52	Director
Howell E. Begle, Jr.		62	Director

     Each director is elected annually and serves until the next annual meeting of shareholders or until his/her successor is duly elected and qualified. Our directors are not compensated for their service as directors. They do, however, receive reimbursement of expenses incurred from the attendance at Board of Directors meetings. Please see Item 13: Certain Relationships and Related Transactions for a description of consulting payments made to Mr. Scudder. Our executive officers are appointed by and serve at the pleasure of the Board of Directors.

Business Experience

     Richard B. Scudder has served as Chairman of the Board and a Director of MediaNews since 1985.

     William Dean Singleton has served as Vice Chairman and Chief Executive Officer and a Director of MediaNews since 1985. He is also the Publisher of The Denver Post effective February 2001, the Publisher of The Salt Lake Tribune effective August 2002, and the Publisher of the York Daily Record and York Sunday News effective May 2004.

     Joseph J. Lodovic, IV has served as President of MediaNews since February 2001. Prior thereto, he served as Executive Vice President and Chief Financial Officer from 1993 to February 2001. Mr. Lodovic has been with MediaNews since 1987.

     Steven B. Rossi has served as Executive Vice President and Chief Operating Officer of MediaNews since September 2006. Prior thereto he served as Senior Vice President and Chief Financial Officer of Knight Ridder Inc. from January 2005 until its acquisition by The McClatchy Company in June 2006. He previously served as President/Newspaper Division of Knight Ridder from 2001 to 2004 and Senior Vice President/Operations of Knight Ridder from 1998 to 2001.

     Anthony F. Tierno has served as Senior Vice President of Operations since February 2001. Prior thereto, he served as Executive Vice President and Chief Operating Officer of MediaNews from 1993 to February 2001. Mr. Tierno has been with MediaNews since its inception in 1985.

     Eric J. Grilly has served as President of MediaNews Group Interactive since October 2002 and as Senior Vice President of MediaNews Group since September 2006. Prior thereto, he served as Vice President of MediaNews Group Interactive

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from October 2000 to October 2002. From May 1999 to October 2000, Mr. Eric Grilly was Vice President of Interactive Media of The Denver Post Corporation. Mr. Eric Grilly is the son of Mr. Gerald E. Grilly who served as Executive Vice President and Chief Operating Officer of MediaNews from February 2001 through August 2006.

     Ronald A. Mayo has served as Vice President and Chief Financial Officer since February 2001. Prior thereto, he served as Vice President Finance and Controller from September 1994 to February 2001.

     James L. McDougald has served as Treasurer since September 1994. Prior thereto, he was Controller for MediaNews from 1988 to 1994.

     Michael J. Koren has served as Vice President and Controller since July 2001.

     Steven M. Barkmeier has served as Vice President Tax since July 2004. Prior thereto, he served as Director of Tax from November 1995 to June 2004.

     Elizabeth A. Gaier has served as Senior Vice President of New Business Development since January 2006. Prior thereto, she served as Vice President of New Business Development from November 2001 to January 2006. Prior thereto she served as Director of Advertising at the Ventura County Star from 2000 to 2001.

     Charles M. Kamen has served as Vice President Human Resources for MediaNews Group since he joined the Company in April 2000.

     David M. Bessen has served as Vice President and Chief Information Officer since November 2005. Prior thereto, he served as Director of Information Services for Copley Press from 1996 to 2005.

     Patricia Robinson has served as Secretary of MediaNews since 1986. Ms. Robinson is the sister of Mr. William Dean Singleton.

     Jean L. Scudder has served as a Director of MediaNews since July 1998. Ms. Scudder is the daughter of Mr. Richard B. Scudder.

     Howell E. Begle, Jr. has served as a Director of MediaNews since November 1996. Mr. Begle is Of Counsel to Hughes Hubbard & Reed LLP, which law firm is counsel to MediaNews and its affiliates.

Audit Committee Financial Expert

     We are not a listed issuer as defined in Rule 10A-3 under the Exchange Act and therefore are not required to have an audit committee comprised of independent directors; our board of directors acts as our audit committee. Additionally, we do not have an audit committee financial expert, as that term is defined by Item 401(h) of Regulation S-K.

Code of Ethics

     We have adopted a code of ethics that applies to all employees and officers of MediaNews. You may obtain a copy of our code of ethics, without charge, by request directed to Ronald A. Mayo, at MediaNews Group, Inc., 101 West Colfax, Suite 1100, Denver, CO 80202, (303) 954-6360.

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Item 11: Executive Compensation

     The following table sets forth the cash compensation paid or payable to Mr. Singleton and each of the other four most highly compensated executive officers whose direct or allocated cash compensation exceeded $100,000 for services rendered to MediaNews in fiscal year 2006. None of our executive officers have an employment agreement with us except Messrs. Singleton and Lodovic.

			Annual Compensation				Long Term Compensation
							Restricted Stock		All Other
Name and Principal Position	Fiscal Year		Salary		Bonus		Awards (a)		Compensation (b)
William Dean Singleton		2006	$	1,010,625	$	250,000	$	588,745	$	159,988
Vice Chairman, Chief Executive Officer		2005		962,475		450,000		—		196,427
		2004		872,250		150,000		—		115,933
Joseph J. Lodovic, IV		2006	$	671,700	$	250,000	$	353,320	$	80,785
President		2005		639,600		400,000		—		60,316
		2004		574,950		150,000		—		47,140
Gerald E. Grilly (c)		2006	$	614,375	$	81,250	$	659,190	$	50,367
Executive Vice President &		2005		589,375		157,500		—		64,509
Chief Operating Officer		2004		538,050		113,750		—		15,398
Anthony F. Tierno		2006	$	373,013	$	5,000	$	1,334,075	$	24,105
Senior Vice President of Operations		2005		358,750		42,500		—		30,414
		2004		322,875		61,250		—		19,164
Eric J. Grilly		2006	$	271,050	$	75,000	$	156,950	$	9,896
President, MediaNews Group Interactive		2005		256,250		95,500		—		23,355
		2004		206,500		83,500		—		10,213

(a)	Reflects the value of restricted stock units calculated by multiplying the number of units granted times the fair value as defined and calculated in accordance with the RSU plan document on the date of the grant. The number of restricted stock units held by each of the named executive officers at June 30, 2006 and the dollar value of such units are as follows: Mr. Singleton, 1,613 units, $390,346; Mr. Lodovic, 968 units, $234,256; Mr. Gerald E. Grilly, 1,806 units, $437,052; Mr. Tierno, 3,655 units, $884,510; Mr. Eric J. Grilly, 430 units, $104,060. Fair market value of the RSU grants fluctuates with our performance and the performance of certain of our peers in the newspaper industry.
(b)	Included in “All Other Compensation” are amounts earned under the deferred compensation plans described below.
(c)	Effective August 31, 2006, Mr. Grilly retired from MediaNews. In connection therewith, Mr. Grilly will receive severance of $1.25 million payable over three years, $150,000 bonus associated with the August 2, 2006 acquisition, as well as $250,000 in connection with the Company’s long-term compensation plans.

     During fiscal year 2003, we adopted the non-qualified MediaNews Group Supplemental Executive Retirement Plan, or the “2003 Plan,” which does not qualify as a long-term incentive plan as defined in Instruction 7 (iii) to Item 402(a)(3) of Regulation S-K. This plan has been offered to certain of our eligible corporate executives. The 2003 Plan allows participants to defer a portion of their compensation, including bonuses, if any, on a pre-tax basis. There is no company match on these deferrals; however, the deferrals earn a return based on notional investment elections made by the individual participants. In addition, we may, at our discretion, elect to make contributions to the participants’ accounts based on a comparison of our actual profits to budgeted profits during each fiscal year. Any such contribution is subject to vesting, which is generally ten years from the date of participation in the plan. In addition to the 2003 Plan, in fiscal year 2004 we implemented an executive retiree medical benefit plan. The retiree medical benefit plan provides for full health care coverage during retirement for the participants in the 2003 plan. There are minimum age and years of service criteria for eligibility for benefits under this plan.

     We also award discretionary bonuses to executive officers who are not covered by employment agreements based on completion of individual performance criteria determined on an annual basis.

     Effective June 29, 2005, we adopted the Career Restricted Stock Unit Plan (“RSU Plan”) intended to encourage retention and reward performance of selected senior management over a significant period of time. The RSU plan is administered by our board of directors (or a designated committee). The RSU Plan provides for the award to members of senior management selected by our board (or committee) for participation in the Plan of such number of restricted stock units (“RSUs”) at such

43

time or times as determined by our board (or committee) in its discretion. Each RSU represents the right to receive one share of our new class of common stock, Class B (which is non-voting and does not pay dividends, but which is convertible into Class A in certain circumstances), subject to vesting and other requirements. RSUs granted to a participant vest upon the later to occur of:

• the earlier of (x) the completion of 20 years of continuous service with us or our affiliates or (y) attainment of age 67 while still employed by us or our affiliates; or

• the date on which the participant (a) has completed at least five years of participation in RSU Plan and (b) has a combined age and years of continuous service with us or our affiliates of at least 72.

     RSUs fully vest upon the occurrence of a “Change in Control” (as defined) and vest pro rata in the event of the participant’s death, disability or termination of employment by us without cause. Any RSUs not so vested are forfeited upon the participant’s termination of employment, unless otherwise determined by the board (or committee) in its sole discretion.

     Shares of our Class B common stock will be issued to holders of vested RSUs upon the earliest of the participant’s separation from service, the participant’s disability and the occurrence of a “Qualified Change in Control” (as defined).

     Recipients of shares issued pursuant to RSUs have the right to require us to repurchase a number of shares at their then fair market value (as determined by formula outlined in the RSU plan) that is sufficient to enable them to pay taxes due in connection with such issuance, provided that our board of directors may suspend such right at any time. At any time following the six-month anniversary of the date of issuance of shares of such Class B common stock, we have the right to repurchase such shares at their then fair market value (as determined by formula outlined in the RSU plan). Such repurchase rights will terminate if we consummate an initial public offering of our common stock.

     The issuance of up to 150,000 shares of our Class B common stock is authorized under the RSU Plan. RSU grants have been awarded to the following executive officers in fiscal years 2006 and 2007: Mr. William Dean Singleton, Mr. Joseph J. Lodovic, IV, Mr. Anthony F. Tierno, Mr. Ronald A. Mayo, Mr. James L McDougald, Mr. Charles M. Kamen, Mr. Eric J. Grilly and Ms. Elizabeth A. Gaier. Mr. Gerald E. Grilly and Mr. Stephen M. Hesse received RSU grants in fiscal year 2006.

Equity Compensation Plan Information

     As of June 30, 2006, the number of shares of our Class B common stock to be issued upon exercise of securities issued under our Career RSU Plan (which is our only equity compensation plan) and the number of shares reserved for future issuance thereunder was as follows:

	(a)		(b)		(c)
					Number of securities remaining
	Number of securities to		Weighted-average		available for the future issuance
	be issued upon exercise		exercise price of		under equity compensation
	of outstanding options,		outstanding options,		plans (excluding securities
Plan Category	warrants and rights		warrants and rights		reflected in column (a))
Equity compensation plans approved by security holders		- 0 -	$	- 0 -		139,895
Equity compensation plans not approved by security holders		- 0 -	$	- 0 -		- 0 -

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Employment and Other Agreements

     Under the terms of Mr. Singleton’s Employment Agreement, which was amended and restated effective July 1, 2005, Mr. Singleton is currently entitled to receive cash compensation at an annual rate of $1,035,300, subject to annual increase of not less than 5%, and a one-time cash bonus of $100,000, which was paid in June 2005. In addition, Mr. Singleton is entitled to receive an annual cash bonus of up to $500,000 for each fiscal year based on a comparison of our actual profits to budgeted profits during such fiscal year. Other discretionary bonuses may be paid which are not part of his Employment Agreement, if approved by the Board of Directors. Mr. Singleton’s Employment Agreement expires on December 31, 2009, but is automatically renewed for successive one-year terms unless either party gives notice terminating the Employment Agreement at least 120 days prior to the expiration of the existing term. Additionally, Mr. Singleton’s Employment Agreement may be terminated prior to the expiration of the existing term under certain circumstances. Mr. Singleton is entitled to severance payments if his employment terminates for certain reasons. In addition, if the Employment Agreement terminates by expiration at the end of the initial term or any renewal term, Mr. Singleton is entitled to receive a cash payment equal to his base annual salary in effect immediately prior to termination, plus an amount equal to the maximum annual bonus he is eligible to earn. Under Mr. Singleton’s Employment Agreement, he is eligible to participate in equity ownership and incentive plans established for executive personnel. Mr. Singleton’s Employment Agreement also provides for him to be reimbursed for the annual premium (up to a maximum premium of $100,000 per year) on up to $40 million of term life insurance insuring his spouse as part of his estate planning. Mr. Singleton’s Employment Agreement contains a two-year non-compete covenant for all geographical areas in which newspapers are owned or managed by us and or our subsidiaries with paid print circulation in excess of 25,000 at the time of termination of the Employment Agreement; provided, however that the ownership of up to 5% of any class of publicly traded securities of any entity shall not be deemed to be a violation. In the event of his disability, Mr. Singleton has the right to require MediaNews to purchase his common stock from time to time during his lifetime in an aggregate amount not to exceed $1.0 million in any fiscal year. At June 30, 2006, the total estimated cost (determined actuarially) of the repurchase would be $26.8 million and such amount is recorded as a component of “Putable Common Stock” on our balance sheet. From 1996 through 2002, MediaNews advanced a total of $1.5 million to the Singleton Irrevocable Trust (see Item 12: Security Ownership of Certain Beneficial Owners and Management) to fund premiums on cash surrender life insurance policies covering Mr. Singleton and his wife. The advances are recorded in our consolidated balance sheet as a component of other long-term assets. Advances will be repaid when the policy is surrendered or earlier at Mr. Singleton’s option. No interest is charged to Mr. Singleton on these advances. No funding by MediaNews of this insurance coverage has occurred subsequent to July 2002. The cash surrender value life insurance policies were originally purchased in order to mitigate the impact of estate taxes that may be due on MediaNews stock held in the Singleton Revocable Trust as a result of the death of Mr. Singleton and his spouse and the resulting need for us to repurchase such shares to provide liquidity in the Singleton Revocable Trust.

     Mr. Lodovic’s Employment Agreement was amended and restated effective July 1, 2005. Mr. Lodovic is currently entitled to receive cash compensation at an annual rate of $688,200, subject to annual increase of not less than 5%, and a one-time cash bonus of $100,000, which was paid in June 2005. In addition, Mr. Lodovic is also entitled to receive an annual cash bonus of up to $400,000 for each fiscal year based on a comparison of our actual profits to budgeted profits during such year. Other discretionary bonuses may also be paid which are not part of his employment agreement, if approved by the Board of Directors. Mr. Lodovic’s Employment Agreement expires on December 31, 2009, but is automatically renewed for successive one-year terms unless either party gives notice terminating the Employment Agreement at least 120 days prior to the expiration of the existing term. Additionally, Mr. Lodovic’s Employment Agreement may be terminated prior to the expiration of the existing term under certain circumstances. Mr. Lodovic is entitled to severance payments if his employment terminates for certain reasons. In addition, if the Employment Agreement terminates by expiration at the end of the initial term or any renewal term, Mr. Lodovic is entitled to receive a cash payment equal to his base annual salary in effect immediately prior to termination, plus an amount equal to the maximum annual bonus he is eligible to earn. Under Mr. Lodovic’s Employment Agreement, he is also eligible to participate in equity ownership and incentive plans established for executive personnel. Mr. Lodovic’s Employment Agreement contains a two-year non-compete covenant for all geographical areas in which newspapers are owned or circulated by us or our subsidiaries with paid print circulation in excess of 25,000 at the time of termination of the Employment Agreement; provided, however that the ownership of up to 5% of any class of publicly traded securities of any entity shall not be deemed to be a violation. Mr. Lodovic is also party to a Shareholder Agreement with the Company. The Shareholder Agreement entitles Mr. Lodovic, upon termination of his employment following December 31, 2009, by mutual agreement, or as a result of breach by the Company or certain other circumstances, to put to us at a price of 100% of the then fair market value (as determined by formula outlined in the Shareholder Agreement) shares of Class A and B common stock which he owns. We also have a call under Mr. Lodovic’s Shareholder Agreement to acquire, and Mr. Lodovic has a right to put, such shares following termination of his employment under other

45

circumstances, at a price equal to a percentage of fair market value (as determined by formula outlined in the Shareholder Agreement), which increases to 100% on December 31, 2009 (at June 30, 2006, Mr. Lodovic is entitled to 80% of the fair market value). As of June 30, 2006, the value of Mr. Lodovic’s put, as calculated per terms of the Shareholder Agreement, was estimated to be $14.1 million and is recorded as a component of “Putable Common Stock” on our balance sheet. In the event of his disability, Mr. Lodovic has the right to require MediaNews to purchase his common stock from time to time during his lifetime in an aggregate amount not to exceed $1.0 million in any fiscal year.

Compensation Committee Interlocks and Insider Participation

     Decisions regarding annual compensation of executives other than Messrs. Singleton and Lodovic are made by Mr. Singleton and Mr. Lodovic. Our Board of Directors is responsible for approving Mr. Singleton’s and Mr. Lodovic’s Employment Agreements, including their compensation. The Board of Directors of MediaNews does not have a compensation committee.

Item 12: Security Ownership of Certain Beneficial Owners and Management

     The authorized capital stock of MediaNews consists of 3,000,000 shares of Class A common stock, $0.001 par value, 2,314,346 shares of which are issued of which 2,298,346 are outstanding and 16,000 are held in treasury and 150,000 shares of Class B common stock, $0.001 par value, none of which are issued or outstanding at June 30, 2006. We have not declared or paid any cash dividends on our common stock in the past. Our current long-term debt agreements place limits on our ability to pay dividends. In conjunction with an investment by Hearst in the Company (if approved by the Department of Justice), we anticipate paying a dividend to the Class A Shareholders of approximately $25.0 million with a portion of the proceeds from the Hearst investment.

     The following table sets forth the number and percentage of shares of our common stock currently issued and outstanding and beneficially owned by (i) each person known to us to be the beneficial owner of more than 5.0% of any class of our equity securities; (ii) each executive officer as defined in Item 402(a)(3) of Regulation S-K; and (iii) all directors and executive officers of MediaNews as a group.

	Amount and Nature of		Percentage of
	Beneficial Ownership(a)		Ownership of
	Class A Common Stock		Class A Common Stock
William Dean Singleton(b),(c),(l),(m)		254,858.9900		11.09	%
Howell E. Begle, Jr.(b),(d),(l),(m)		786,426.5100		34.22	%
Patricia Robinson(b),(e),(l),(m)		786,426.5100		34.22	%
Joseph J. Lodovic, IV(b),(f)		58,199.0000		2.53	%
Jean L. Scudder(g),(k)		384,065.1200		16.71	%
Charles Scudder(h),(k)		260,321.3750		11.32	%
Elizabeth H. Difani(h),(i),(k)		219,073.4575		9.53	%
Carolyn Miller(h),(j),(k)		177,825.5475		7.74	%
All directors and executives as a group(n)		2,140,770.0000		93.14	%

(a)	Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission. Except as indicated by footnote, the persons named in the tables above have sole voting and investment power with respect to all shares of capital stock indicated as beneficially owned by them.
(b)	The address of each such person is: c/o Mr. Howell E. Begle, Jr., Trustee, 1775 I Street N.W., Suite 600, Washington, D.C. 20006. Mr. Begle is Of Counsel to Hughes Hubbard & Reed LLP, which law firm is counsel to us.
(c)	These shares are held by a revocable trust for the benefit of the children of Mr. Singleton (the “Singleton Revocable Trust”), for which trust Mr. Begle and Mr. Singleton are trustees.
(d)	Includes all shares for which Mr. Begle has sole voting power under the Singleton Family Voting Trust Agreement for MediaNews (the “Singleton Family Voting Trust Agreement for MediaNews”) and shared investment power, as a trustee for an irrevocable trust for the benefit of Mr. Singleton’s children (the “Singleton Irrevocable Trust”). Also includes all shares of common stock held by the Singleton Revocable Trust for which Mr. Begle is a trustee.

46

(e)	These shares are held by the Singleton Irrevocable Trust for which Ms. Robinson serves as a trustee and as to which she has shared investment power. Ms. Robinson is Mr. Singleton’s sister.
(f)	Legal ownership of 50% of such shares is held by the Singleton Family Voting Trust. Legal ownership of the remaining 50% of such shares is held by the Scudder Family Voting Trust.
(g)	Includes 123,743.745 shares of common stock held by a trust for the benefit of two of Ms. Scudder’s nephews, for which trust Ms. Scudder serves as the sole trustee. Also includes 74,504 shares of common stock held for the benefit of Ms. Scudder’s son, Benjamin Fulmer, and daughter, Nina Fulmer, for which Ms. Scudder also serves as the sole trustee. Does not include the shares held by Charles Scudder, Elizabeth Difani, as trustee and/or custodian for certain of her children, or Carolyn Miller, as trustee and/or custodian for certain of her minor children, with respect to which Ms. Scudder has sole voting power pursuant to the Scudder Family Voting Trust Agreement for MediaNews (the “Scudder Family Voting Trust Agreement”). Charles Scudder, Elizabeth Difani and Carolyn Miller are siblings of Ms. Scudder; all four are the children of Mr. Richard B. Scudder.
(h)	Sole voting power with respect to these shares is held by Ms. Scudder pursuant to the Scudder Family Voting Trust Agreement. See note (g) above.
(i)	Ms. Difani holds 132,299.6658 shares as trustee and/or custodian for certain of her children. Sole voting power with respect to all 219,073.4575 shares is held by Ms. Scudder pursuant to the Scudder Family Voting Trust Agreement. See note (g) above.
(j)	Ms. Miller holds 118,550.365 shares as trustee for certain of her children. Sole voting power with respect to all 177,825.5475 shares is held by Ms. Scudder pursuant to the Scudder Family Voting Trust Agreement. See note (g) above.
(k)	The address of each person is: c/o Jean L. Scudder, 193 Old Kents Hill Road, Readfield, Maine 04355.
(l)	Indicates shared voting power.
(m)	Indicates shared investment power.
(n)	No directors or officers of MediaNews beneficially own any shares in MediaNews at June 30, 2005 except Mr. Singleton, Ms. Scudder, Mr. Begle, Ms. Robinson and Mr. Lodovic.

Scudder Family Voting Trust Agreement for MediaNews

     The children of Richard B. Scudder, which includes Charles A. Scudder, Carolyn S. Miller, Elizabeth H. Difani and Jean L. Scudder, respectively, and Joseph J. Lodovic, IV have entered into the Scudder Family Voting Trust Agreement for MediaNews (the “Scudder Family Voting Trust”) in accordance with which all shares of our common stock held by Charles Scudder, Carolyn Miller, Elizabeth H. Difani, Jean L. Scudder and 50% of those shares held by Joseph J. Lodovic, IV, were transferred to the Scudder Family Voting Trust for MediaNews. Under the Scudder Family Voting Trust for MediaNews, Jean L. Scudder (the “Scudder Trustee”) exercises all voting rights (subject to the consent of shareholders holding 50% of the common stock held by the Scudder Family Voting Trust for MediaNews on such matters as election of directors, mergers, dissolution or reorganization of MediaNews, sale, exchange or pledge of all or substantially all of the assets of MediaNews and acquisition or divestiture by MediaNews of any newspaper venture) and substantially all other rights to which such shareholders would otherwise be entitled until January 31, 2010, subject to extension by written agreement of one or more beneficiaries of the Scudder Family Voting Trust Agreement for MediaNews and the Scudder Trustee.

Singleton Family Voting Trust Agreement for MediaNews

     The Singleton Irrevocable Trust, the Singleton Revocable Trust and Joseph J. Lodovic, IV have entered into the Singleton Family Voting Trust Agreement for MediaNews (the “Singleton Family Voting Trust Agreement for MediaNews”) in accordance with which all shares of our common stock held by the Singleton Irrevocable Trust and the remaining 50% of those shares held by Joseph J. Lodovic, IV were transferred to the Singleton Family Voting Trust for MediaNews and the shares of our common stock held by the Singleton Revocable Trust will be transferred to the Singleton Family Voting Trust for MediaNews upon the death or incapacity of Mr. Singleton. Under the Singleton Family Voting Trust Agreement for MediaNews, the Singleton Trustees exercise all voting and substantially all other rights to which such shareholders would otherwise be entitled until January 31, 2010, subject to extension by written agreement of one or more beneficiaries of the Singleton Family Voting Trust Agreement for MediaNews.

47

MediaNews Shareholders’ Agreement

     The Singleton Revocable Trust, the Singleton Irrevocable Trust, the Singleton Family Voting Trust for MediaNews, the Scudder Family Voting Trust for MediaNews, certain of the beneficiaries of such trusts, Joseph J. Lodovic, IV and MediaNews entered into a Shareholders’ Agreement (the “MediaNews Shareholders’ Agreement”) which provides, among other things, that action by the Board of Directors with respect to such matters as the issuance of capital stock, declaration of dividends, redemption of capital stock, certain capital expenditures, mergers or consolidation, and incurring certain indebtedness requires the unanimous approval of all Directors then serving on the Board of Directors or approval by the holders of 75% of the shares of Class A Common Stock entitled to vote on such matters.

     The MediaNews Shareholders’ Agreement also provides that until the earlier of (i) the date on which none of our 6 7/8% Senior Subordinated Notes due October 1, 2013, and our 6 3/8% Senior Subordinated Notes due April 1, 2014 are outstanding, or (ii) when MediaNews’ Leverage Ratio (as defined in the indenture relating to our 6 3/8% Senior Subordinated Notes) is less than 3:1, no shareholder may sell, transfer, pledge or otherwise encumber their shares or their interest in their shares, of our common stock to any third party (except to the Company and certain permitted transfers to family members and other shareholders), without the consent of all our shareholders or unless all shares of common stock then outstanding are sold in a single transaction or a contemplated sale to a third party. If any shareholder desires to sell or transfer his shares to us or the other shareholders without an identified third party buyer, then such shareholder may offer to sell his shares to us at fair market value determined by appraisal, or if we decline to purchase such shares, such shareholder may offer to sell his shares to the remaining shareholders at fair market value.

Item 13: Certain Relationships and Related Transactions

Management Services

     We are a party to a consulting agreement, renewable annually, with Mr. Richard Scudder, which agreement requires us to make annual payments of $300,000. In connection with his consulting services, Mr. Scudder participates in our medical plans at no cost to him and we provide Mr. Scudder with the use of a car, which is also used for personal purposes. The cost to us for providing this car during the last fiscal year and currently has been the cost of insurance and maintenance. We also pay the compensation for an administrative assistant for Mr. Scudder.

     We are a party to a management agreement with CNP, which prior to being amended as described below, provided us with a management fee of 1.25% of CNP’s revenues, thereby reducing our total corporate overhead, the effect of which is a reduction of the impact minority interest expense has on our consolidated statement of operations. In connection with the August 2, 2006 acquisition of the Contra Costa Times and the San Jose Mercury News, and the related contribution of those publications into the California Newspapers Partnership, the CNP management agreement was revised. Effective August 2, 2006, the revised agreement provides for annual management fees of $5.4 million, subject to annual adjustments based on actual costs and the operating performance of CNP.

     In addition, in connection with the restructuring of the Texas-New Mexico Newspapers Partnership, the Company as managing controlling partner is provided an annual management fee of $75,000 by the partnership, subject to annual adjustments.

Other

     MediaNews uses Hughes Hubbard & Reed LLP as one of its legal counsel. Mr. Howell Begle, who is general counsel and a board member of MediaNews, is Of Counsel to Hughes Hubbard & Reed LLP.

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Item 14: Principal Accountant Fees and Services

     The following table presents fees incurred for services provided by Ernst & Young LLP.

     All audit and non-audit services for which we engaged the independent auditor to perform and were required to be pre-approved were pre-approved by our board of directors, which acts as our audit committee. The board of directors considers, among other things, the possible effect of the performance of such services on the auditor’s independence in order to ensure that the provision of such services does not impair the auditors’ independence.

	Years Ended June 30,
	2006		2005		2004
	(Dollars in thousands)
Audit Fees(a)	$	618	$	563	$	617
Audit-Related Fees(b)		18		2		121
Tax Fees(c)		2		65		5
Total	$	638	$	630	$	743

(a)	Fees for professional services incurred by the auditors to comply with Generally Accepted Auditing Standards, reviews of the Company’s filings with the Securities Exchange Commission, and comfort letters.
(b)	Fees for professional services which principally include services in connection with employee benefit plan audits, due diligence and consultation related to mergers and acquisitions, internal control reviews, attest services not required by statute or regulation, and consultation concerning financial accounting and reporting standards.
(c)	Fees for professional services for tax compliance, tax advice and tax planning. These services include assistance regarding federal and state tax compliance, return preparation and tax audits.

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AVAILABLE INFORMATION

     MediaNews consummated exchange offers for its 6 7/8% Senior Subordinated Notes due 2013 and its 6 3/8% Senior Subordinated Notes due 2014 in April 2004. Because the exchange offers were registered under the Securities Act of 1933, MediaNews became subject to the reporting requirements of the Securities Exchange Act of 1934 upon effectiveness of the registration statements for the exchange offers. Our duty to file reports with the Commission has been suspended in respect of our fiscal year commencing July 1, 2006 pursuant to Section 15(d) of the Securities Exchange Act of 1934. However, the indentures governing our Senior Subordinated Notes require that we continue to file quarterly, annual and, if applicable, current reports on Form 8-K, with the Commission on a voluntary basis.

     You can inspect and copy our annual, quarterly and current reports and other information filed with or furnished to the Commission at the public reference facilities of the Commission in Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549. You can also obtain copies of these materials from the public reference section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Please call the Commission at 1-800-SEC-0330 for further information on the public reference rooms. The Commission also maintains a Web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission (http://www.sec.gov).

     Copies of our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of charge through our Internet site www.medianewsgroup.com as soon as reasonably practicable after we electronically file the material with, or furnish it to, the Securities and Exchange Commission. The information on our Web site is not incorporated by reference to, or as part of, this Report on Form 10-K.

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PART IV

Item 15: Exhibits and Financial Statement Schedules

(a) Financial Statements

1.	The list of financial statements contained in the accompanying Index to Consolidated Financial Statements and Schedule Covered by Report of Independent Registered Public Accounting Firm is filed as a part of this Report (see page 52).
2.	Financial Statement Schedule
	The financial statement schedule contained in the accompanying Index to Consolidated Financial Statements and Schedule Covered by Report of Independent Registered Public Accounting Firm is filed as a part of this Report (see page 52).
3.	Exhibits
	The exhibits listed in the accompanying Index to exhibits are filed as a part of this Annual Report (see page 52).

51

MEDIANEWS GROUP, INC.

Index to Consolidated Financial Statements and Schedule
Covered by Report of Independent Registered Public Accounting Firm

     The following financial statements of the registrant and its subsidiaries required to be included in Items 8 and 15(a)(1) are listed below:

	Page
Report of Independent Registered Public Accounting Firm		53
Consolidated Balance Sheets as of June 30, 2006 and 2005		54
Consolidated Statements of Operations for the Fiscal Years Ended June 30, 2006, 2005 and 2004		56
Consolidated Statements of Changes in Shareholders’ Equity for the Fiscal Years Ended June 30, 2006, 2005 and 2004		57
Consolidated Statements of Cash Flows for the Fiscal Years Ended June 30, 2006, 2005 and 2004		58
Notes to Consolidated Financial Statements		59

     The following financial statement schedule of the registrant and its subsidiaries required to be included in Item 15(a)(2) is listed below:

Schedule II Valuation and Qualifying Accounts 94

     All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable and therefore have been omitted or the information is presented in the consolidated financial statements or related notes.

52

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors
MediaNews Group, Inc.

     We have audited the accompanying consolidated balance sheets of MediaNews Group, Inc. and subsidiaries as of June 30, 2006 and 2005, and the related consolidated statements of operations, statements of changes in shareholders’ equity and cash flows for each of the three years in the period ended June 30, 2006. Our audits also included the financial statement schedule listed in the accompanying index to consolidated financial statements. These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

     We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

     In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of MediaNews Group, Inc. and subsidiaries at June 30, 2006 and 2005, and the consolidated results of their operations and their cash flows for each of the three years in the period ended June 30, 2006, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

/s/ ERNST & YOUNG LLP

Ernst & Young LLP 

September 25, 2006
Denver, Colorado

53

MEDIANEWS GROUP, INC. & SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	June 30,
	2006			2005
	(Dollars in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	424		$	4,262
Trade accounts receivable, less allowance for doubtful accounts of $9,282 and $6,901, at June 30, 2006 and 2005, respectively		93,705			82,284
Other receivables		12,327			5,427
Inventories of newsprint and supplies		21,289			24,248
Prepaid expenses and other assets		11,954			14,616
Income taxes receivable		—			2,820
TOTAL CURRENT ASSETS		139,699			133,657
PROPERTY, PLANT AND EQUIPMENT
Land		41,871			37,403
Buildings and improvements		131,336			105,352
Machinery and equipment		397,949			356,510
Construction in progress		57,657			43,602
TOTAL PROPERTY, PLANT AND EQUIPMENT		628,813			542,867
Less accumulated depreciation and amortization		(249,588	)		(210,561	)
NET PROPERTY, PLANT AND EQUIPMENT		379,225			332,306
OTHER ASSETS
Investment in unconsolidated JOAs (Denver and Salt Lake City)		228,925			262,764
Equity investments		54,457			91,421
Subscriber accounts, less accumulated amortization of $161,776 and $149,397 at June 30, 2006 and 2005, respectively		39,365			49,543
Excess of cost over fair value of net assets acquired		424,161			392,748
Newspaper mastheads		101,829			76,662
Covenants not to compete and other identifiable intangible assets, less accumulated amortization of $34,506 and $31,771 at June 30, 2006 and 2005, respectively		15,656			5,175
Other		44,466			21,496
TOTAL OTHER ASSETS		908,859			899,809
TOTAL ASSETS	$	1,427,783		$	1,365,772

See notes to consolidated financial statements

54

MEDIANEWS GROUP, INC. & SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	June 30,
	2006			2005
	(Dollars in thousands, except share data)
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Trade accounts payable	$	19,526		$	15,045
Accrued employee compensation		33,299			34,772
Accrued interest		11,690			10,428
Other accrued liabilities		19,486			15,132
Unearned income		31,715			26,577
Income taxes payable		4,193			—
Current portion of long-term debt and obligations under capital leases		4,133			4,088
TOTAL CURRENT LIABILITIES		124,042			106,042
OBLIGATIONS UNDER CAPITAL LEASES		5,763			5,969
LONG-TERM DEBT		857,997			867,512
OTHER LIABILITIES		28,774			47,359
DEFERRED INCOME TAXES, NET		103,349			98,208
MINORITY INTEREST		207,439			153,633
PUTABLE COMMON STOCK		40,899			48,556
SHAREHOLDERS’ EQUITY
Common stock, par value $0.001; 3,150,000 shares authorized:
2,314,346 shares issued and 2,298,346 shares outstanding		2			2
Additional paid-in capital		—			—
Accumulated other comprehensive loss, net of taxes:
Unrealized loss on hedging		(1,588	)		(2,330	)
Minimum pension liability		(19,932	)		(31,483	)
Retained earnings		83,038			74,304
Common stock in treasury, at cost, 16,000 shares		(2,000	)		(2,000	)
TOTAL SHAREHOLDERS’ EQUITY		59,520			38,493
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,427,783		$	1,365,772

See notes to consolidated financial statements

55

MEDIANEWS GROUP, INC. & SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	Years Ended June 30,
	2006			2005			2004
	(Dollars in thousands, except share data)
REVENUES
Advertising	$	660,389		$	610,060		$	582,689
Circulation		130,829			129,344			132,505
Other		44,658			39,875			38,635
TOTAL REVENUES		835,876			779,279			753,829
INCOME (LOSS) FROM UNCONSOLIDATED JOAS		(23,298	)		23,291			22,207
COSTS AND EXPENSES
Cost of sales		260,939			242,653			234,784
Selling, general and administrative		417,602			382,180			366,636
Depreciation and amortization		44,067			40,598			40,742
Interest expense		55,564			49,481			57,036
Other (income) expense, net		1,440			8,669			17,365
TOTAL COSTS AND EXPENSES		779,612			723,581			716,563
EQUITY INVESTMENT INCOME, NET		5,898			10,201			9,485
GAIN ON SALE OF NEWSPAPER PROPERTIES		1,129			114			6,982
MINORITY INTEREST		(35,033	)		(29,334	)		(32,237	)
INCOME BEFORE INCOME TAXES		4,960			59,970			43,703
INCOME TAX EXPENSE		(3,883	)		(20,090	)		(16,966	)
NET INCOME	$	1,077		$	39,880		$	26,737

See notes to consolidated financial statements

56

MEDIANEWS GROUP, INC. & SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

						Accumulated
			Additional			Other						Common			Total
	Common		Paid-In			Comprehensive			Retained			Stock in			Shareholders’
	Stock		Capital			Loss			Earnings			Treasury			Equity
						(Dollars in thousands)
BALANCE AT JUNE 30, 2003	$	2	$	3,631		$	(19,351	)	$	52,612		$	(2,000	)	$	34,894
Comprehensive income:
Unrealized gain on hedging activities, net of tax expense of $194		—		—			291			—			—			291
Unrealized loss on hedging activities, reclassified to earnings, net of tax benefit of $1,300		—		—			1,884			—			—			1,884
Minimum pension liability adjustment, net of tax benefit of $1,867		—		—			(2,800	)		—			—			(2,800	)
Net income		—		—			—			26,737			—			26,737
Comprehensive income																26,112
BALANCE AT JUNE 30, 2004		2		3,631			(19,976	)		79,349			(2,000	)		61,006
Adjustment for putable common stock		—		(3,631	)		—			(44,925	)		—			(48,556	)
Comprehensive income:
Unrealized loss on hedging activities, net of tax benefit of $426		—		—			(697	)		—			—			(697	)
Unrealized loss on hedging activities, reclassified to earnings, net of tax benefit of $348		—		—			456			—			—			456
Minimum pension liability adjustment, net of tax benefit of $10,168		—		—			(13,596	)		—			—			(13,596	)
Net income		—		—			—			39,880			—			39,880
Comprehensive income																(26,043	)
BALANCE AT JUNE 30, 2005		2		—			(33,813	)		74,304			(2,000	)		38,493
Adjustment for putable common stock		—		—			—			7,657			—			7,657
Comprehensive income:
Unrealized gain on hedging activities, net of tax benefit of $153		—		—			286			—			—			286
Unrealized loss on hedging activities, reclassified to earnings, net of tax benefit of $348		—		—			456			—			—			456
Minimum pension liability adjustment, net of tax expense of $9,310		—		—			11,551			—			—			11,551
Net income		—		—			—			1,077			—			1,077
Comprehensive income																13,370
BALANCE AT JUNE 30, 2006	$	2	$	—		$	(21,520	)	$	83,038		$	(2,000	)	$	59,520

See notes to consolidated financial statements

57

MEDIANEWS GROUP, INC. & SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years Ended June 30,
	2006			2005			2004
				Revised			Revised
	(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,077		$	39,880		$	26,737
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		43,248			25,834			25,554
Amortization		20,901			18,953			19,584
Loss on early extinguishment of debt		—			9,236			9,292
Net loss (gain), on sale of newspaper assets		(1,097	)		437			(6,931	)
Provision for losses on accounts receivable		9,893			8,065			7,405
Amortization of debt discount		935			1,051			934
Minority interest		35,033			29,334			32,237
Distributions paid to minority interest		(40,782	)		(28,167	)		(36,176	)
Proportionate share of net income from unconsolidated JOAs		(44,120	)		(71,878	)		(69,204	)
Distributions of net income from unconsolidated JOAs(a)		44,120			71,878			66,828
Equity investment income, net		(5,898	)		(10,201	)		(9,485	)
Distributions of net income from equity investments(b)		5,228			9,511			9,676
Deferred income tax expense (benefit)		(4,545	)		17,728			16,387
Change in defined benefit plan liabilities, net of cash contributions		2,427			1,463			1,082
Change in estimated option repurchase price		500			(5,306	)		(3,491	)
Unrealized loss on hedging activities, reclassified to earnings from accumulated other comprehensive loss		456			804			3,184
Unrealized (gain) loss on swaps		—			—			2,968
Change in operating assets and liabilities:
Accounts receivable		(18,564	)		(13,356	)		(6,446	)
Inventories		4,026			(7,632	)		(2,113	)
Prepaid expenses and other assets		4,599			(4,301	)		808
Accounts payable and accrued liabilities		10,406			6,374			(7,485	)
Unearned income		2,881			173			1,341
Change in other assets and liabilities, net		784			(6,936	)		(6,231	)
NET CASH FLOWS FROM OPERATING ACTIVITIES		71,508			92,944			76,455
CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in equity investments		(575	)		(250	)		(50	)
Proceeds from the sale of newspapers and other assets		746			483			56,733
Business acquisitions, net of cash acquired		(47,905	)		(58,607	)		(50,072	)
Capital received from unconsolidated subsidiaries		1,379			—			—
Distributions in excess of net income from JOAs(a)		28,148			15,531			8,376
Distributions in excess of net income from equity investments(b)		1,254			1,486			962
Capital expenditures		(47,501	)		(51,312	)		(36,483	)
NET CASH FLOWS FROM INVESTING ACTIVITIES		(64,454	)		(92,669	)		(20,534	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of long-term debt, net of issuance costs		66,350			464,250			523,983
Reduction of long-term debt and other liabilities		(77,242	)		(516,375	)		(509,046	)
Repurchase premiums and related costs associated with long-term debt		—			(8,624	)		(9,465	)
NET CASH FLOWS FROM FINANCING ACTIVITIES		(10,892	)		(60,749	)		5,472
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(3,838	)		(60,474	)		61,393
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR		4,262			64,736			3,343
CASH AND CASH EQUIVALENTS AT END OF YEAR	$	424		$	4,262		$	64,736

(a)	Total distributions from unconsolidated JOAs were $72.3 million, $87.4 million and $75.2 million for fiscal years 2006, 2005 and 2004, respectively.
(b)	Total distributions from equity investments were $6.5 million, $11.0 million and $10.6 million for fiscal years 2006, 2005 and 2004, respectively.

See notes to consolidated financial statements

58

MEDIANEWS GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1: Basis of Presentation

     MediaNews Group, Inc. (“MediaNews” or the “Company”), through its subsidiaries, publishes daily and non-daily newspapers serving markets in twelve states, including the impact of the Company’s August 2, 2006 acquisition discussed in Note 16: Subsequent Events. The Company also owns four radio stations and one television station; the combined revenues of these non-newspaper operations comprise less than 1.0% of the Company’s consolidated revenue and are not considered significant to the Company’s operations.

Note 2: Significant Accounting Policies and Other Matters

     Significant accounting policies for the Company involve its assessment of the recoverability of its long-lived assets, including goodwill and other intangible assets, which is based on such factors as estimated future cash flows and current fair value estimates. The Company’s accounting for pension and retiree medical benefits requires the use of estimates concerning the work force, interest rates, plan investment return, and involves the use of advice from consulting actuaries. The workers’ compensation obligation involves estimating ultimate claims payouts for open claims and involves the use of advice and analysis of actuaries. The Company’s accounting for federal and state income taxes is sensitive to interpretation of various laws and regulations and assumptions on the realization of deferred tax assets.

Use of Estimates

     The preparation of financial statements in accordance with generally accepted accounting principles at times requires the use of estimates and assumptions. The Company uses estimates, based on historical experience, actuarial studies and other assumptions, as appropriate, to assess the carrying values of its assets and liabilities and disclosure of contingent matters. The Company re-evaluates its estimates on an ongoing basis. Actual results could differ from these estimates.

Principles of Consolidation

     All significant intercompany accounts have been eliminated.

Revisions/Reclassifications

     For comparability, certain prior year balances have been reclassified to conform to current reporting classifications. In particular, the statements of cash flows have been revised for the years ended June 30, 2005 and 2004, to reclassify the distribution of net income from equity investments from net cash flows from investing activities to net cash flows from operating activities and to reflect distributions in excess of net income from unconsolidated JOAs and equity investments as cash flows from investing activities in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 95, Statement of Cash Flows. For the year ended June 30, 2005, the revision increased the reported net cash flows from investing activities and decreased the reported net cash flows from operating activities by $6.0 million. For the year ended June 30, 2004, the revision decreased the reported net cash flows from investing activities and increased the reported net cash flows from operating activities by $1.3 million.

Joint Operating Agencies

     A joint operating agency (“JOA”) performs the production, sales, distribution and administrative functions for two or more newspapers in the same market under the terms of a joint operating agreement. Editorial control and news at each newspaper party to a joint operating agreement continue to be separate and outside of a JOA. As of June 30, 2006, the Company, through its partnerships and subsidiaries, participates in JOAs in Denver, Colorado, Salt Lake City, Utah, York, Pennsylvania, Detroit, Michigan and Charleston, West Virginia.

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     The operating results from the Company’s unconsolidated JOAs (Denver, Salt Lake City and, through May 7, 2004, Charleston) are reported as a single net amount in the accompanying financial statements in the line item “Income from Unconsolidated JOAs.” This line item includes:

• The Company’s proportionate share of net income from JOAs,

• The amortization of subscriber lists created by the original purchase, as the subscriber lists are attributable to the Company’s earnings in the JOAs, and

• Editorial costs, miscellaneous revenue received outside of the JOA, and other charges incurred by the Company’s consolidated subsidiaries directly attributable to the JOAs providing editorial content and news for the Company’s newspapers party to the JOAs.

     The Company’s investments in the Denver and Salt Lake City JOAs are included in the consolidated balance sheet under the line item “Investment in Unconsolidated JOAs”. See Note 3: Joint Operating Agencies for additional discussion of our accounting for each JOA operation in which the Company participates.

Cash and Cash Equivalents

     The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

Trade Accounts Receivable

     Trade accounts receivable are generally from advertisers, commercial printing customers, single copy newspaper outlets, newspaper subscribers and independent newspaper delivery contractors. The Company extends unsecured credit to most of its customers. Credit limits, setting and maintaining credit standards and managing the overall quality of the credit portfolio is largely decentralized (maintained and managed at the individual newspaper locations). The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The allowance for doubtful accounts is based on both the aging of accounts receivable at period end and specific identification.

Inventories

     Inventories, which largely consist of newsprint, are valued at the lower of cost or market. Cost is generally determined using the first-in, first-out method.

Investments

     The Company has made the following strategic investments, which are accounted for under the equity method (for those investments in which the Company has less than 20% ownership, the Company accounts for these under the equity method as the Company has seats on the board and, therefore, has significant influence and ties to the entity beyond the Company’s invested capital):

• Prairie Mountain Publishing Company, partnership that publishes the former Eastern Colorado Publishing Company newspapers (comprised of several small daily and weekly newspapers) and the Daily Camera and Colorado Daily, both published in Boulder, Colorado (50% ownership interest).

• PowerOne Media, LLC, a company that provides software tools and hosts classified advertising for daily and weekly newspapers throughout the United States (16% ownership interest),

• CIPS Marketing Group, Inc., a total market coverage delivery service in Los Angeles (50% ownership interest),

• Gallup Independent Company, publisher of the Gallup Independent in Gallup, New Mexico (approximately 38% ownership interest),

• Ponderay Newsprint Company, a minority investment in a newsprint mill held by the Company’s subsidiary, Kearns-Tribune, LLC (6.0% ownership interest and one seat on the board).

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• Texas-New Mexico Newspapers Partnership through December 25, 2005, which was formed on March 3, 2003 (the Company held a minority interest of 33.8% through December 25, 2005). Effective December 26, 2005, as a result of contributions to the partnership and an amendment and restatement of the partnership agreement, the Company owns 59.4% of the partnership and consolidates its results after such date. See Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership for further discussion.

• Hometown Values, acquired in July 2005, advertising coupon magazine for small local businesses mailed to 16 different targeted community zones along the Wasatch front in Utah (50% ownership interest).

     These investments are included in the consolidated balance sheet as a component of long-term assets under the caption “equity investments.” See Note 14: Equity Investments (Non-JOA) for further information.

Property, Plant and Equipment

     Property, plant, and equipment are recorded at cost. Buildings and machinery and equipment are depreciated using the straight-line method over the expected useful lives of individual assets. Buildings and improvements are depreciated over the lesser of 40 years or the term of the lease and machinery and equipment is depreciated over 3 to 20 years.

Goodwill and Other Intangible Assets

     The Company accounts for goodwill and other intangible assets under SFAS No. 142, Goodwill and Other Intangible Assets. Under the standard, excess of cost over fair value of net assets acquired (goodwill) and other indefinite life intangibles (primarily mastheads) are not amortized, but instead are periodically reviewed for impairment. All other intangibles with a finite useful life continue to be amortized over their estimated useful lives. Subscriber accounts are amortized using the straight-line method over periods ranging from 8 to 15 years with a weighted average remaining life based on the date of acquisitions of approximately 9 years. Other finite lived intangibles are being amortized over periods not exceeding 15 years.

     In addition, as required by SFAS No. 142, the Company performed an annual impairment test for goodwill and mastheads as of July 1, 2006. There was no impairment of intangible assets noted as a result of these tests. Another impairment test will be performed July 1, 2007, unless unexpected events or circumstances arise that require the Company to test for impairment sooner.

     Estimated amortization expense for the next five years is as follows at June 30, 2006 (excluding the impact of August 2, 2006 acquisition transactions discussed in Note 16: Subsequent Events) (in thousands):

2007	$	12,231
2008		8,623
2009		5,546
2010		4,810
2011		4,443

Long-Lived Assets

     SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, addresses financial accounting and reporting for the impairment or disposal of long-lived assets. The carrying value of long-lived assets is reviewed annually. If, at any time, the facts or circumstances at any of the Company’s individual newspaper or other operations indicate the impairment of long-lived asset values as a result of a continual decline in performance or as a result of fundamental changes in a market, a determination is made as to whether the carrying value of the long-lived assets exceeds estimated realizable value. For purposes of this determination, estimated realizable value is evaluated based on values placed on comparable assets, generally based on a multiple of revenue and/or operating profit (revenues less cost of sales and selling, general and administrative expenses); however, other valuation methods may be used.

Debt Discount

     Debt discount is amortized in a manner that results in a constant rate of interest over the life of the related debt and is included as a component of interest expense.

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Income Taxes

     The Company accounts for income taxes utilizing the liability method of accounting for income taxes. Under the liability method, deferred income taxes are recognized for the tax consequences of “temporary differences” by applying enacted statutory tax rates applicable to differences between the financial statement carrying amount and the tax basis of existing assets and liabilities.

Revenue Recognition

     Advertising revenue is earned and recognized when advertisements are published, inserted, aired or displayed and are net of provisions for estimated rebates, credit and rate adjustments and discounts. Circulation revenue includes single copy and home delivery subscription revenue. Single copy revenue is earned and recognized based on the date the publication is delivered to the single copy outlet, net of provisions for returns. Home delivery subscription revenue net of discounts is earned and recognized when the newspaper is delivered to the customer or sold to a home delivery independent contractor. Amounts received in advance of an advertisement or newspaper delivery are deferred and recorded on the balance sheet as a current liability to be recognized into income when the revenue has been earned.

Disclosures about Segments of an Enterprise and Related Information

     The Company conducts business in one reporting segment and determines its reporting segment based on the individual operations that the chief operating decision maker reviews for purposes of assessing performance and making operating decisions. The individual operations have been aggregated into one segment because management believes they have similar economic characteristics, products, services, customers, production processes and distribution methods. The Company believes that aggregating the operations into one segment helps users understand the Company’s performance and assess its prospects. The Company’s newspaper operations, individually and in the aggregate, generally trend in the same direction because they are impacted by the same economic trends. A newspaper’s operating performance is most affected by newsprint prices and the health of the national economy, particularly conditions within the retail, employment, real estate and automotive markets. While an individual newspaper may perform better or worse than the Company’s newspapers as a whole due to specific conditions at that newspaper or within its local economy, such variances generally do not significantly affect the overall year over year performance comparisons of the Company.

     While the Company, in addition to its newspapers, operates four radio stations and one television station, these non-newspaper operations are not significant to the Company’s operations as they comprise less than 1.0% of our consolidated revenue.

Comprehensive Income

     Under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (“SFAS No. 133”), the Company’s newsprint swap agreements were recorded at fair value and changes in the value of such contracts, net of income taxes, were reported in comprehensive income. As of June 30, 2006 and 2005 and 2004, the Company had no outstanding newsprint agreements; however, amounts previously recorded in other comprehensive income related to a terminated newsprint swap agreement remained in other comprehensive income at June 30, 2006 due to the Company’s determination that the hedge became ineffective prior to the expiration of the original term of the agreement. The amount in accumulated other comprehensive loss related to the ineffective hedge is being amortized and charged to other (income) expense, net over the original term of the agreement as the forecasted newsprint purchase transactions originally contemplated in the hedging agreement continued to be probable of occurring. Also included in comprehensive income are the changes in fair value of interest rate swap agreements at one of the Company’s unconsolidated JOAs. See Note 10: Hedging Activities for further discussion. Comprehensive income for the Company also includes a minimum pension liability adjustment related to one of the Company’s pension plans (at June 30, 2005, two of the Company’s pension plans had other comprehensive income) and a pension plan at one of the Company’s unconsolidated JOAs. See Note 8: Employee Benefit Plans for further discussion. For purposes of calculating income taxes related to comprehensive income, the Company uses its combined statutory rate for federal and state income taxes.

Stock Based Compensation

     The Company accounts for its Career Restricted Stock Unit (“RSU”) plan under SFAS No. 123 (R) , Share Based Payments. SFAS No. 123 (R) requires all share-based payments to employees be recognized in the income statement based on their fair values. The Company determines the fair value of the units granted based on the RSU plan document and recognizes compensation expense over the vesting period of the grant. See Note 15: Career Restricted Stock Unit Plan for further discussion.

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Dividends

     The Company has never paid a dividend on its common stock. The Company may pay a dividend in connection with future equity financing from The Hearst Corporation. See Note 16: Subsequent Events for further discussion regarding a possible equity investment in the Company by The Hearst Corporation. The Company’s long-term debt agreements contain covenants which, among other things, limit the amount the Company can pay in dividends to its shareholders.

Employees

     Certain employees of the Company’s newspapers are employed under collective bargaining agreements.

Recently Issued Accounting Standards

     In July 2006, the FASB issued Interpretation No. 48 (“FIN 48”), Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109, effective for fiscal years beginning after December 15, 2006. FIN 48 creates a single model to address uncertainty in tax positions, prescribes the minimum recognition threshold, and provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. FIN 48 also has expanded disclosure requirements, which include a tabular rollforward of the beginning and ending aggregate unrecognized tax benefits, as well as specific detail related to tax uncertainties for which it is reasonably possible the amount of unrecognized tax benefit will significantly increase or decrease within twelve months. The adoption of FIN 48 is not expected to have a material impact on the Company’s financial statements.

Note 3: Joint Operating Agencies

Denver JOA

     The Company through its wholly-owned subsidiary, The Denver Post Corporation, owns the masthead of The Denver Post and a 50% interest in the Denver Newspaper Agency (“DNA” or the “Denver JOA”), a partnership which publishes The Denver Post and the Rocky Mountain News, under the terms of a JOA agreement. DNA is the managing entity of the JOA agreement between The Denver Post Corporation and E.W. Scripps Company (owner of the Rocky Mountain News). Under the terms of the JOA agreement, DNA is responsible for performing all the business functions of The Denver Post and the Rocky Mountain News, including advertising and circulation sales, production, distribution and administration. News and editorial costs related to The Denver Post are incurred outside of the Denver JOA and are the sole responsibility of the Company. Conversely, E.W. Scripps Company is solely responsible for the news and editorial costs of the Rocky Mountain News. In addition to the Company’s proportionate share of income from DNA, the editorial costs, miscellaneous revenues outside of the JOA, depreciation of editorial assets owned outside of the JOA, and other direct costs of The Denver Post are included in the line item “Income from Unconsolidated JOAs.” The Denver JOA agreement expires in 2051, unless otherwise extended.

Salt Lake City JOA

     The Company, through its wholly-owned subsidiary, Kearns-Tribune, LLC, owns The Salt Lake Tribune and a 58% profit interest in the Newspaper Agency Company LLC (“NAC” or the “Salt Lake City JOA”). Although the Company has a majority of the Salt Lake City JOA’s profit interests, under the operating agreement for that entity, each of the Company and Deseret News Publishing Company (our partner in the Salt Lake JOA) have an equal representation on that entity’s management committee. The Salt Lake City JOA is the managing entity under the JOA agreement between Kearns-Tribune, LLC and the Deseret News Publishing Company (owner of the Deseret Morning News). Under the terms of this JOA agreement, the Salt Lake City JOA is responsible for performing all the business functions of The Salt Lake Tribune and the Deseret Morning News, including advertising and circulation sales, production and distribution; however, the Salt Lake City JOA does not own any of the fixed assets used in its operations. Instead, beginning July 1, 2006, most of those assets are owned by its affiliate, Salt Lake Newspapers Production Facilities, LLC (“SLNPF”), 58% of which entity is owned directly by the Company and 42% of which entity is owned by Deseret News Publishing Company. SLNPF leases those assets to the Salt Lake JOA; however, management of SLNPF is shared equally between Kearns-Tribune and Deseret News Publishing Company. Certain other assets used in the operations of the Salt Lake City JOA are owned solely by Deseret News Publishing Company, which leases those assets directly to the Salt Lake City JOA, and certain other assets are owned jointly

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by Kearns- Tribune, LLC and Deseret News Publishing Company, as tenants in common. Prior to July 1, 2006, Kearns-Tribune, LLC and Deseret News Publishing Company owned the fixed assets as joint tenants in common and did not charge lease payments to the Salt Lake City JOA. News and editorial costs related to The Salt Lake Tribune are incurred outside of the Salt Lake City JOA and are the sole responsibility of Kearns-Tribune, LLC. Conversely, Deseret News Publishing Company is solely responsible for the news and editorial costs of the Deseret Morning News. The Company records its 58% share of the results of the operations of the Salt Lake City JOA along with the operations of Kearns-Tribune, LLC, which consists principally of editorial costs, miscellaneous revenues outside of the JOA, amortization of intangibles, depreciation of fixed assets, and other direct costs of The Salt Lake Tribune, in the line item “Income from Unconsolidated JOAs.” The Salt Lake City JOA expires in 2020, unless otherwise extended.

York JOA

     Prior to May 1, 2004, the Company, through its wholly-owned subsidiary, York Newspapers, Inc. (“YNI”), owned the masthead of The York Dispatch, a daily evening newspaper, the York Sunday News, as well as a 57.5% interest in The York Newspaper Company (the York JOA). York Daily Record, Inc. (“YDR”) owned the remaining 42.5% in the York JOA and the masthead of the York Daily Record. Under the terms of the York JOA agreement, the York JOA was responsible for all newspaper publishing operations, other than news and editorial, including production, sales, distribution and administration, of The York Dispatch, the York Daily Record, a daily morning newspaper, and the York Sunday News. Because YNI had the controlling interest and was the controlling partner of the York JOA, the operations of the JOA were consolidated with those of the Company, with a minority interest reflected for YDR’s interest in the York JOA. Prior to May 1, 2004, the operating results of the York JOA did not include the editorial costs associated with the publication of the York Daily Record since the Company did not own the newspaper and the costs were incurred outside of the JOA.

     Effective April 30, 2004, the Company restructured its interest in the York JOA through the exercise of its call option to acquire the remaining 42.5% interest in The York Newspaper Company and the masthead of the York Daily Record for approximately $38.3 million. As a result of the option exercise and the restructuring of the York JOA, the Company became responsible for the news and editorial content of the York Daily Record and an affiliate of YDR became responsible for providing the news and editorial content for The York Dispatch. However, the Company still owns the masthead and all other tangible and intangible assets of The York Dispatch. Under the restructured JOA, the Company is entitled to all of the profits and losses of the York JOA and reimburses the affiliate of the former partner for the cost of providing editorial and news content in The York Dispatch plus a management fee of $256,653 per year, indexed annually for inflation. The transaction was accounted for under the purchase method of accounting. Approximately $4.6 million of the $38.3 million transaction price was attributable to purchasing the remaining minority interest in The York Newspaper Company, $5.3 million was attributable to identifiable intangible assets ($3.2 million of which was related to the York Daily Record masthead; the remainder was associated with subscriber and advertiser lists) and $28.4 million was recorded as goodwill. The York JOA expires in 2024, unless otherwise extended. See Note 2: Significant Accounting Policies and Other Matters — Joint Operating Agencies and Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership for further discussion of the contribution of York to the Texas-New Mexico Newspapers Partnership.

Charleston JOA

     Prior to May 7, 2004, the Company, through its wholly-owned subsidiary, Charleston Publishing Company, owned the masthead of the Charleston Daily Mail and a 50% interest in Charleston Newspapers (the “Charleston JOA”), which publishes the Charleston Gazette (morning) and Charleston Daily Mail (evening) six days a week and the Sunday Gazette-Mail, under the terms of a JOA agreement. The managerial responsibility for the news and editorial functions was completely separate from the JOA; accordingly, the Company was only responsible for the news and editorial content of the Charleston Daily Mail. However, related editorial expenses were incurred and paid within the Charleston JOA. As a result, all editorial expenses of the three Charleston JOA publications were included in the Company’s proportionate share of income from Charleston Newspapers, which is included in Income from Unconsolidated JOAs prior to the restructuring of ownership. Amortization of intangibles and other direct costs associated with the JOA incurred by Charleston Publishing Company were also included in Income from Unconsolidated JOAs. On May 7, 2004, the Company restructured its ownership interest in the Charleston JOA. In exchange for $55.0 million in cash (less a net adjustment of approximately $3.5 million for 50% of Charleston Newspapers’ working capital, long-term employee benefit liabilities and long-term debt) and a limited partnership interest in a newly formed entity (Charleston Newspapers Holdings, L.P.), the Company contributed its general partnership interest in Charleston Newspapers and the masthead of the Charleston Daily Mail to Charleston Newspapers Holdings, L.P.

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In addition, in conjunction with the restructuring, the Company agreed to continue to be responsible for the news and editorial content of the Charleston Daily Mail. Under its agreement with Charleston Newspapers Holdings, L.P., the Company is reimbursed for the cost of providing the news and editorial content of the Charleston Daily Mail and is paid a management fee. The Company’s limited partnership interest does not entitle the Company to any share of the profits or losses of the limited partnership. As a result of the restructuring transaction, the Company recorded a pre-tax gain of approximately $8.0 million in its fourth quarter of fiscal year 2004 and wrote off $10.6 million of net intangible assets. The Charleston JOA expires in 2024, unless otherwise extended.

Detroit JOA

     On August 3, 2005, the Company purchased the stock of The Detroit News, Inc., which included the editorial assets of The Detroit News, a daily newspaper published in Detroit, Michigan, and a limited partnership interest in the Detroit Newspaper Partnership, L.P. (“Detroit JOA”), for approximately $25.0 million. The Company is responsible for the news and editorial content of The Detroit News pursuant to a JOA agreement. In accordance with the Detroit JOA agreement, the Company receives a fixed preferred distribution each month with possible incremental distributions beginning in 2009 based on profit growth. However, such distributions can be suspended to the extent that the Detroit JOA has insufficient profits to make such fixed preferred distributions. Any shortfall in distributions will be carried forward and made when sufficient profits are available. The fixed preferred distributions are as follows: $0.2 million per month during calendar year 2005; $5.0 million for calendar years 2006 and 2007; $4.0 million for 2008 and 2009; $3.0 million for 2010 and 2011; $2.0 million for 2012; and $1.9 million for all remaining years until specified amounts are paid. Under the terms of the Detroit JOA, the Company is also reimbursed for its news and editorial costs associated with publishing The Detroit News. The Detroit JOA expires in 2025, unless otherwise extended.

     Because of the structure of the partnership and our ownership interest, our accounting for the investment in the Detroit JOA only includes the preferred distributions we receive from the Detroit JOA, which is different from our accounting for the Denver and Salt Lake City JOAs. The Company’s investment in The Detroit News, Inc. is included in other long-term assets.

Unconsolidated JOA Summarized Results

     The following tables present the summarized results of the Company’s unconsolidated JOAs in Denver and Salt Lake City and through May 7, 2004, the JOA in Charleston, on a combined basis, along with related balance sheet data. The Salt Lake City JOA data has been presented separately because, as of June 30, 2006, it is a significant investee of the Company as determined in accordance with Rule 3-09 of Regulation S-X. Beginning in fiscal year 2005, The Denver JOA data is no longer combined with the Charleston JOA data as a result of the May 2004 Charleston JOA restructuring. The fiscal year 2004 income statement data combines the Denver JOA and the Charleston JOA in the column “Other Unconsolidated JOAs.” The Salt Lake City JOA, Denver JOA and Other Unconsolidated JOA information is presented at 100%, with the other partners’ share of income from the related JOAs subsequently eliminated. The editorial costs, miscellaneous revenues received outside of the JOA, depreciation, amortization, and other direct costs incurred outside of the JOAs by our subsidiaries associated with The Salt Lake Tribune, The Denver Post, and through May 7, 2004, the Charleston Daily Mail are included in the line “Associated Revenues and Expenses.” The 20% minority interest associated with The Denver Post through June 10, 2005 has not been reflected in the following tables.

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	Year Ended June 30, 2006
										Total Income
							Associated			from
	Salt Lake			Denver			Revenues and			Unconsolidated
	City JOA			JOA			Expenses			JOAs
				(Dollars in thousands)
Income Statement Data:
Total revenues	$	149,041		$	419,055		$	484
Cost of sales		34,222			132,893			34,530
Selling, general and administrative		55,017			207,263			12,272
Depreciation and amortization		—			56,225			20,082
Other		2,643			922			1,019
Total costs and expenses		91,882			397,303			67,903
Net income		57,159			21,752			(67,419	)
Partners’ share of income from unconsolidated JOAs		(23,914	)		(10,876	)		—
Income from unconsolidated JOAs	$	33,245		$	10,876		$	(67,419	)	$	(23,298	)

	Year Ended June 30, 2005
										Total Income
							Associated			from
	Salt Lake			Denver			Revenues and			Unconsolidated
	City JOA			JOA			Expenses			JOAs
				(Dollars in thousands)
Income Statement Data:
Total revenues	$	146,904		$	433,183		$	527
Cost of sales		32,440			134,488			33,744
Selling, general and administrative		53,638			204,792			11,069
Depreciation and amortization		—			18,468			4,189
Other		2,485			(341	)		112
Total costs and expenses		88,563			357,407			49,114
Net income		58,341			75,776			(48,587	)
Partners’ share of income from unconsolidated JOAs		(24,351	)		(37,888	)		—
Income from unconsolidated JOAs	$	33,990		$	37,888		$	(48,587	)	$	23,291

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	Year Ended June 30, 2004
										Total Income
				Other			Associated			from
	Salt Lake			Unconsolidated			Revenues and			Unconsolidated
	City JOA			JOAs			Expenses			JOAs
	(Dollars in thousands)
Income Statement Data:
Total revenues	$	139,673		$	459,102		$	560
Cost of sales		31,650			145,895			32,911
Selling, general and administrative		53,482			212,446			10,001
Depreciation and amortization		—			21,630			4,396
Other		214			4,103			249
Total costs and expenses		85,346			384,074			47,557
Net income		54,327			75,028			(46,997	)
Partners’ share of income from unconsolidated JOAs		(22,637	)		(37,514	)		—
Income from unconsolidated JOAs	$	31,690		$	37,514		$	(46,997	)	$	22,207

	June 30, 2006				June 30, 2005
	Salt Lake				Salt Lake City
	City JOA		Denver JOA		JOA		Denver JOA
	(Dollars in thousands)
Balance Sheet Data:
Current assets	$	15,800	$	64,352	$	20,349	$	67,467
Non-current assets		14,589		221,399		10,825		188,627
Current liabilities		24,589		50,396		25,686		51,533
Non-current liabilities(1)		7,043		135,069		7,124		55,853

(1) The June 30, 2006 and 2005 amounts for the Denver JOA includes the Denver JOA lease (related to the construction of a new building) which is expected to be terminated in the second quarter of the Company’s fiscal year 2007.

     Depreciation and amortization expense increased significantly for the year ended June 30, 2006, as compared to the same periods in the prior year due to accelerated depreciation on certain fixed assets at the production facilities in Denver and Salt Lake City which will be or have been retired earlier than originally expected due to the construction of new production facilities at the respective locations. The depreciation and amortization expense for the Salt Lake City fixed assets appears in the associated revenues and expenses column as the Salt Lake City JOA does not own any of the fixed assets used in its operations. Instead, each partner in the JOA owns the fixed assets used in the operations of the Salt Lake City JOA and, effective July 1, 2006, leases them to the Salt Lake City JOA through SLNPF.

Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership

California Newspapers Partnership

     On March 31, 1999, through its wholly-owned subsidiary, West Coast MediaNews LLC, the Company formed the California Newspapers Partnership (“CNP”) with S.F. Holding Corporation, formerly Stephens Media Group, (“Stephens”), and The Sun Company of San Bernardino California (“Gannett”). MediaNews, Stephens and Gannett’s interests in the California Newspapers Partnership are 54.23%, 26.28% and 19.49%, respectively. The Company is the controlling partner and, therefore, the operations of the partnership are consolidated with those of the Company with minority interest reflected for Stephens’ and Gannett’s interests in the partnership.

     At the formation of CNP, the Company also contributed long-term debt with a remaining balance of $6.6 million to the partnership. However, in accordance with the partnership agreement, the Company remains liable for the contributed debt. All principal and interest payments associated with this debt are charged to the MediaNews capital account of CNP as a

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distribution. Approximately $0.9 million, $0.8 million and $1.0 million of principal and interest payments were made in fiscal years 2006, 2005 and 2004, respectively, by CNP on behalf of the Company.

     The California Newspapers Partnership is governed by a management committee. The management committee consists of seven members. MediaNews is entitled to appoint four of the members on the management committee, SMG is entitled to appoint two, and Gannett is entitled to appoint one. Decisions of the management committee are by majority vote, except that unanimous votes are required for certain actions, including asset transfers or sales, asset acquisitions, incurrence of debt and certain material changes in the partnership business.

     The California Newspapers Partnership agreement also contains transfer of interests restrictions. None of the partners were able to transfer their interests before January 1, 2004, and after that date, transfers may be made only subject to the “right of first offer” of the remaining partners. In addition, where no partner exercises its right of first offer, any sale of a partner’s interest must include the right for the remaining partners to “tag-along” and sell their interests to the third-party buyer at the same price. After January 1, 2005, MediaNews has the right to require the other partners to sell their interests to any third party to which MediaNews sells its interest.

     Stephens has a separate right to require CNP to purchase its interest in the partnership at fair market value anytime after January 1, 2005. Upon notification of the exercise of this right and obtaining a valuation of the partnership interest, CNP has two years to complete the purchase. The Company is not currently aware of any intentions on the part of Stephens to exercise its put.

     The minority interest liability reflects the fair market value of the net assets at the time they were contributed to CNP by Stephens and Gannett, plus the minority partners’ share of earnings, net of distributions since inception. CNP made cash distributions to the Company in the amount of $34.2 million, $33.4 million and, $34.5 million in fiscal years 2006, 2005, and 2004, respectively.

     On April 26, 2006, the Company entered into an agreement with Gannett and Stephens (the “Stephens/Gannett Contribution Agreement”) pursuant to which Gannett and/or Stephens agreed to contribute their pro rata share of the initial purchase price (plus estimated transactions fees and expenses) of The Monterey County Herald for a total ranging between $27.4 million and $38.4 million depending on whether The Monterey County Herald is purchased by CNP or a possible new partnership between the Company and Stephens, which would be owned 67.36% by the Company and 32.64% by Stephens.

Texas-New Mexico Newspapers Partnership

     Effective March 3, 2003, MediaNews and Gannett Co., Inc. (“Gannett”) formed the Texas-New Mexico Newspapers Partnership (“TNMP”). MediaNews contributed substantially all the assets and operating liabilities of the Las Cruces Sun-News, The Daily Times (Farmington), Carlsbad Current-Argus, Alamogordo Daily News, and The Deming Highlight, as well as all the weekly and other publications published by these daily newspapers, in exchange for a 33.8% interest in the TNMP. Gannett contributed the El Paso Times, located in El Paso, Texas, in exchange for its 66.2% controlling partnership interest. Accordingly, MediaNews accounted for its share of the operations of TNMP under the equity method of accounting. However, effective December 26, 2005, MediaNews contributed to TNMP the assets of four daily newspapers published in southern Pennsylvania and Gannett contributed assets of the Public Opinion, published in Chambersburg, PA. Assets contributed by MediaNews included The Evening Sun (Hanover), the Lebanon Daily News, and MediaNews’ interest in the entity that owns and publishes the York Daily Record and York Sunday News, which will continue to be published under the terms of a joint operating agreement along with The York Dispatch.

     In conjunction with the partners’ contributions of newspaper assets to TNMP, the partnership agreement was amended and restated to provide, among other things, that MediaNews will have the right to appoint a majority of the members of TNMP’s Management Committee and control the day-to-day operations of TNMP. In addition, MediaNews now owns approximately 59.4% of TNMP, and Gannett owns the remaining 40.6%. Effective December 26, 2005, in conjunction with the change in ownership and management, TNMP became a consolidated subsidiary of MediaNews. The contributions to TNMP described in the paragraph above were accounted for as a non-monetary transaction at fair value based on an independent valuation. The restructuring of TNMP described above was treated as three separate, but simultaneous transactions: (1) a sale, whereby for accounting purposes, the Company sold to Gannett a 40.6% interest in its Pennsylvania newspapers, resulting in a $0.3 million non-monetary gain (pursuant to Statement of Financial Accounting Standards No. 153, Exchanges of Non-Monetary Assets), (2) the acquisition of an additional 25.6% interest in TNMP and (3) the acquisition

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of a 59.4% interest in the Chambersburg, PA newspaper. As a result of the business combination, and the consolidation of the Texas-New Mexico Newspapers Partnership, the Company recorded the following: $86.0 million in intangible assets, $52.2 million in net tangible assets, $59.5 million to reflect Gannett’s minority interest, and eliminated its previous $76.2 million equity investment in the Texas-New Mexico Newspapers Partnership. The accounting for the business combination is still preliminary.

     The minority interest liability reflects the fair market value of the net assets of Gannett’s share of TNMP, plus the minority partners’ share of earnings, net of distributions since December 26, 2005. TNMP made cash distributions to the Company in the amount of $12.0 million since the change in control of the partnership on December 26, 2005. Prior to the TNMP restructuring, distributions were recorded as a component of equity investment.

Note 5: Acquisitions, Dispositions and Other Transactions

Acquisitions

Fiscal Year 2006

     See Note 4: Investment in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership for discussion of the Texas-New Mexico Partnership restructuring and Other Transactions - - Fiscal Year 2006 below for discussion of the formation of the Prairie Mountain Publishing Company and Note 3: Joint Operating Agencies for discussion of our purchase of The Detroit News.

Fiscal Year 2005

     On January 4, 2005, the Company entered into a Stock Purchase Agreement pursuant to which the Company purchased all of the outstanding common stock of Diversified Suburban Newspapers, Inc. (“Diversified”), the publisher of The Park Record, in Park City, Utah. The Singleton Family Revocable Trust owned 50% of the outstanding stock of Diversified at the time of purchase. The purchase price was approximately $8.0 million (plus transaction costs of $0.2 million), subject to adjustment to reflect final working capital balances. The Company has allocated the purchase price as follows: $0.8 million tangible assets (primarily fixed assets), $3.6 million identifiable intangible assets ($2.0 million, masthead; $0.4 million, subscriber list; $1.2 million, advertiser list) and $3.8 million was recorded as goodwill. An additional $1.7 million of goodwill was recorded as the offset to the deferred tax liability established in association with the difference between the book and tax basis in the Diversified common stock at the date of the transaction. The Company received a fairness opinion on the purchase price. The transaction was unanimously approved by the disinterested directors of the Company.

     The Singleton Family Revocable Trust holds 254,858.99 shares of the Company’s Class A Common Stock, representing 11.09% of total shares of Class A Common Stock outstanding. Mr. William Dean Singleton, Vice Chairman, Chief Executive Officer and a director of the Company and Mr. Howell Begle, Assistant Secretary, General Counsel and a director of the Company, are trustees of The Singleton Family Revocable Trust. Mr. Singleton is a beneficiary of The Singleton Family Revocable Trust.

     During fiscal year 2005, the Company purchased several small weekly publications in its existing newspaper markets for an aggregate purchase price of approximately $2.1 million. The estimated fair market value of assets acquired reflects management’s current best estimate and is subject to change in the final allocation of the purchase price.

Fiscal Year 2004

     In May 2004, the Company restructured its interest in the York JOA and acquired the masthead and the other identifiable intangible assets of the York Daily Record as discussed in Note 3: Joint Operating Agencies.

     In January 2004, the Company purchased two weekly newspapers; the Grunion Gazette and Downtown Gazette, both published in Long Beach, California for $9.3 million. Approximately $0.2 million of the purchase price was attributable to

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tangible assets, $2.5 million was attributable to identifiable intangible assets and $6.6 million was recorded as goodwill. The Company also owns and operates the Press-Telegram, a daily newspaper published in Long Beach.

Dispositions

Fiscal Year 2006

     See Note 4: Investment in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership for discussion of the Texas-New Mexico Newspapers Partnership restructuring and Fiscal Year 2006 — Other Transactions below for discussion of the formation of the Prairie Mountain Publishing Company.

Fiscal Year 2005

     There were no dispositions in fiscal year 2005.

Fiscal Year 2004

     In May 2004, MediaNews restructured its interests in the Charleston JOA as discussed in Note 3: Joint Operating Agencies.

Other Transactions

Fiscal Year 2006

Prairie Mountain Publishing Company

     On February 1, 2006, MediaNews and E. W. Scripps Company (“Scripps”) completed the formation of the Prairie Mountain Publishing Company LLP (formerly named Colorado Publishing Company LLP). Upon formation of the Prairie Mountain Publishing Company LLP (“PMP”), MediaNews contributed substantially all of the operating assets used in the publication of the newspapers published by Eastern Colorado Publishing Company, comprised of several small daily and weekly newspapers, and Scripps contributed substantially all of the operating assets used in the publication of the Daily Camera and the Colorado Daily, both published in Boulder, Colorado. In addition to the assets contributed to PMP, MediaNews paid Scripps approximately $20.4 million to obtain its 50% interest in PMP. Scripps owns the remaining 50% interest. The management committee of PMP is comprised of four members, two of whom are appointed by MediaNews and two of whom are appointed by Scripps. Under the partnership agreement, PMP is required to make distributions to the Company equal to 50% of earnings, less working capital required by the partnership. The Company’s contribution to PMP was treated as two separate, but simultaneous transactions: (1) a sale, whereby for accounting purposes, the Company sold to Scripps a 50% interest in Eastern Colorado Publishing Company, resulting in a $0.8 million non-monetary gain (pursuant to Statement of Financial Accounting Standards No. 153, Exchanges of Nonmonetary Assets) and approximately $16.6 million of assets were reclassified to equity investments, and (2) the acquisition of a 50% interest in the newspapers contributed to PMP by Scripps. As a result, effective February 1, 2006, MediaNews no longer consolidates the operations of Eastern Colorado Publishing Company contributed to PMP and began accounting for its share of the operations of PMP under the equity method of accounting.

Texas-New Mexico Newspapers Partnership

     See Note 4: Investment in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership for discussion of the Texas-New Mexico Newspapers Partnership restructuring.

Fiscal Year 2005

     On June 10, 2005, the Company acquired for approximately $45.9 million the remaining 20% of The Denver Post Corporation which it did not own.

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Fiscal Year 2004

     The Company’s subsidiary, Alaska Broadcasting Company (or “ABC”), owns the license rights to KTVA, an Anchorage, Alaska affiliate of CBS Broadcasting. Until September 30, 2004, ABC participated, and was the manager, in a Joint Sales Agreement (or “JSA”) with KTBY, an affiliate of Fox Broadcasting, owned by Piedmont Television Holdings LLC (or “Piedmont”). By the terms of the former JSA and a shared services agreement, ABC performed certain production, sales and administrative functions of both stations. Responsibility for programming at the individual stations was separate and remained with the respective licensees.

     The Company also entered into an agreement to purchase the KTBY license and all the operating assets of KTBY from Piedmont for $4.5 million and had paid $1.0 million of the purchase price into an escrow account. The purchase of the KTBY license was subject to FCC (Federal Communications Commission) approval. Effective September 30, 2004, the Company elected not to extend the JSA and purchase agreement, and as a result, the agreements were terminated. Upon the termination of the purchase agreement, the $1.0 million in escrow was forfeited to Piedmont. The escrow deposit was written-off along with $0.1 million of other prepaid acquisition costs as of June 30, 2004.

     The termination of the JSA has not had a material impact on operations or the carrying value of the assets and liabilities of ABC.

Note 6: Long-Term Debt

     Long-term debt consisted of the following:

				June 30,
				2006			2005
				(Dollars in thousands)
Bank Credit Facility (Revolving Portion)		(I	)	$	146,550		$	152,700
Bank Term Loan A		(I	)		100,000			100,000
Bank Term Loan B		(I	)		145,790			—
Bank Term Loan C		(I	)		—			147,263
Various Notes, payable through 2013	(II)				22,770			24,970
6.875% Senior Subordinated Notes, due 2013	(III)				297,925			297,712
6.375% Senior Subordinated Notes, due 2014	(IV)				148,888			148,780
					861,923			871,425
Less current portion of long-term debt					(3,926	)		(3,913	)
				$	857,997		$	867,512

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I.

On December 30, 2003, the Company refinanced its bank credit facility. The credit facility provided for borrowings of up to $600.0 million, consisting of a $350.0 million revolving credit facility and a $250.0 million term loan “B” facility. On August 30, 2004, the Company entered into an amendment and restatement of the December 30, 2003 bank credit facility which refinanced term loan “B” with a $100.0 million term loan “A” and a $148.8 million term loan “C.” On September 8, 2005, the Company entered into another amendment of its December 30, 2003 bank credit facility in order to reduce borrowing margins. The amendment provided for a $147.3 million term loan “B,” which was used to refinance term loan “C.” The revolving credit facility reduces to $250.0 million on December 30, 2008 and matures on December 30, 2009. The Company may increase the amount of the amended facility by up to $200.0 million, subject to obtaining commitments of lenders to loan such additional amounts and to usual and customary conditions. Prior to the maturity date of the revolving facility, borrowings under the revolving facility are permitted to be borrowed, repaid and reborrowed without premium or penalty (other than customary breakage costs). Amounts repaid under the term loans “A” and “B” are not available for reborrowing. The bank credit facility is guaranteed by the Company’s subsidiaries (with certain exceptions) and secured by first priority liens and security interests in all of the capital stock (or other ownership interests) of each of the Company’s and the guarantors’ subsidiaries (with certain exceptions) and its interest in the Texas-New Mexico Newspapers Partnership. The Company also has pledged its interest in the Denver JOA to secure the bank credit facility (subject to certain limitations). The bank credit facility contains a number of covenants that, among other things, restrict the Company’s ability and its subsidiaries’ ability to dispose of assets, incur additional indebtedness, pay dividends or make capital contributions, create liens on assets, make investments, make acquisitions and engage in mergers or consolidations. In addition, the bank credit facility requires compliance with certain financial ratios, including a maximum consolidated debt to consolidated operating cash flow ratio, a maximum consolidated senior debt to consolidated operating cash flow ratio and a minimum consolidated operating cash flow to consolidated fixed charges ratio. At June 30, 2006, the Company was in compliance with all such covenants. Borrowings under the bank credit facility bear interest at rates based upon, at the Company’s option, either 1) the base rate (the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) Bank of America’s prime rate) or 2) Eurodollar rate plus a spread based on the Company’s leverage ratio. At June 30, 2006, Eurodollar borrowing margins varied from 0.75% to 1.00% and base rate borrowing margins were 0% on the revolver portion of the bank credit facility. At June 30, 2006, borrowing margins on the revolver portion of the bank credit facility were set at 1.00% and 0.00% for the Eurodollar and base rate borrowings, respectively. The term loan “A” bears interest at rates based upon, at the Company’s option, Eurodollar or base rates (derived from prime), plus a borrowing margin based on the Company’s leverage ratio. The Eurodollar and base rate borrowing margins on term loan “A” will bear interest at the Eurodollar or base rate, at the Company’s option, plus a borrowing margin based on the pricing grid used for the revolving credit facility. At June 30, 2006, borrowing margins on term loan “A” were set at 1.00% and 0.00% for Eurodollar and base rate borrowings, respectively. Term loan “A” requires quarterly principal payments as follows: $5.0 million beginning in March 2008 through December 2008; $7.5 million from March 2009 through December 2009; and $12.5 million from March 2010 through September 2010, with the remaining balance due at maturity on December 30, 2010. Term loan “B” bears interest based upon, at the Company’s option, Eurodollar or base rates, plus a borrowing margin of 1.25% or 0.25%, respectively. At June 30, 2006, borrowing margins were set at 1.25% and 0.25%, respectively, for the Eurodollar and base rate borrowings. Term loan “B” requires quarterly principal payments as follows: $0.4 million through December 2009, increasing to $35.2 million from March through September 2010, with the remaining balance due at maturity on December 30, 2010. In addition to interest, the Company pays an annual commitment fee of 0.25% to 0.375% on the unused portion of the commitment based on the Company’s leverage ratio. The annual commitment fee is currently set at 0.375%. At June 30, 2006, the Company had $193.0 million available under the credit facility for future borrowings, net of $10.4 million in outstanding letters of credit. The Company incurred debt issuance costs of $3.8 million related to the December 31, 2003 $600.0 million bank credit facility, and another $0.3 million related to the amended facility. These debt issuance costs have been capitalized as a deferred charge, and are being amortized on a straight-line basis over the term of the bank credit facility as a component of amortization expense. The Company amended the facility again in August 2006 adding a $350.0 million term loan “C.” See Note 16: Subsequent Events for a complete discussion of the new terms of the amended credit agreement.

II.

In connection with various acquisitions, the Company’s subsidiaries have issued notes payable to prior owners and assumed certain debt obligations. The notes payable and other debt obligations bear interest at rates ranging from 0.0% to 7.0%. The notes bearing interest at below market rates have been discounted at rates ranging from 8.5% to 10.5%, which reflects the prevailing rate at the date of acquisition. The majority of these notes and other debt obligations are unsecured obligations of the Company.

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III.

On November 25, 2003, the Company completed the sale of $300.0 million of its 6.875% Senior Subordinated Notes due 2013 (or “6.875% Notes”). The Company applied the net proceeds of $291.5 million from the sale of the 6.875% Notes and other available funds to repurchase all of its outstanding $300.0 million 8.75% Notes. Proceeds from the sale of the 6.875% Notes were reduced by an original issue discount of $2.6 million and debt issuance costs of $6.0 million. The Company reduced the principal amount of the 6.875% Notes by the amount of the original issue discount and is amortizing the discount as a component of interest expense using the effective interest method. The debt issuance costs have been capitalized as a deferred charge, and are being amortized on a straight-line basis over the term of the 6.875% Notes as a component of amortization expense. The indebtedness evidenced by the 6.875% Notes is subordinated and junior in right of payment to obligations under the bank credit facility and related term loans. No principal payments are required on the 6.875% Notes until October 1, 2013, at which time all outstanding principal and interest is due and payable. Semi-annual interest payments are due and payable on October 1 and April 1 of each year. The 6.875% Notes are general unsecured obligations of the Company ranking equal in right of payment with the 6.375% Notes.

IV.

On January 26, 2004, the Company completed the sale of $150.0 million of its 6.375% Senior Subordinated Notes due 2014 (or “6.375% Notes”). The Company ultimately used the proceeds of the sale of $146.9 million to temporarily prepay all borrowings under the revolver portion of the bank credit facility. Such prepayment was reborrowed and used, along with cash on hand, to repurchase all of the Company’s $200.0 million 8.625% Notes on July 1, 2004. Proceeds from the sale of the 6.375% Notes were reduced by an original issue discount of $1.4 million and debt issuance costs of $1.8 million. The principal amount of the 6.375% Notes has been reduced by the amount of the original issuance discount, which is being amortized as a component of interest expense using the effective interest method. The debt issuance costs have been capitalized as a deferred charge and are being amortized on a straight-line basis over the term of the 6.375% Notes as a component of amortization expense. The indebtedness evidenced by the 6.375% Notes is subordinated and junior in right of payment to obligations under the new bank credit facility and related term loans. No principal payments are required until April 1, 2014, at which time all outstanding principal and interest is due and payable. Semi-annual interest payments are due and payable on January 1 and July 1 of each year. The 6.375% Notes are general unsecured obligations of the Company ranking equal in right of payment with the 6.875% Notes.

     Maturities of long-term debt for the next five fiscal years and thereafter are shown below (in thousands).

	As of
	June 30, 2006
2007	$	3,926
2008		13,495
2009		28,348
2010		259,312
2011		97,147
Thereafter		459,695
	$	861,923

     Interest paid during the fiscal years ended June 30, 2006, 2005, and 2004 was approximately $55.2 million, $55.4 million and $52.7 million, respectively. Approximately $2.0 million and $0.7 million of interest was capitalized during fiscal years 2006 and 2005, respectively. An immaterial amount of interest was capitalized during fiscal year 2004.

     Letters of credit have been issued in favor of an insurance company providing workers compensation insurance coverage to the Company and its subsidiaries totaling approximately $10.4 million as of June 30, 2006.

     The fair market value of the 6.875% Notes and 6.375% Notes at June 30, 2006 was approximately $272.2 million and $130.9 million, respectively. The carrying value of the Company’s bank debt, which has interest rates tied to prime or the Eurodollar, approximates its fair value. Management cannot practicably estimate the fair value of the remaining long-term debt because of the lack of quoted market prices for these types of securities and its inability to estimate the fair value without incurring the excessive costs of obtaining an appraisal. The carrying amount represents the original issue price net of remaining original issue discounts, if applicable.

     At times, the Company has entered into interest rate swap agreements to reduce its exposure to the uncertainty of short-term interest rate fluctuations associated with its outstanding bank debt. In fiscal year 2004, the Company had swap

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agreements that swapped fixed-rate interest payments for variable interest rate payments based on current pricing. At June 30, 2006 and 2005, the Company had no outstanding interest rate swap agreements. However, during fiscal year 2004, net settlements of the interest rate swap agreements were recorded as adjustments to interest expense. These fixed to variable interest rate swaps did not qualify for hedge accounting, and therefore, changes in their fair value were recognized in other (income) expense, net in the period of change. As a result of marking these derivative instruments to market, a loss of $3.0 million was recognized in other (income) expense, net for the year ended June 30, 2004. The net cash settlements of the Company’s interest rate swap agreements had the effect of decreasing interest expense by $3.0 million for the year ended June 30, 2004.

Note 7: Leases

     The California Newspapers Partnership leases assets under capital leases. One of the capital leases was renegotiated during fiscal year 2005 resulting in an adjustment to the asset and the corresponding liability of approximately $0.5 million. Assets under capital leases and related accumulated amortization are included in property, plant and equipment in the accompanying consolidated balance sheets at June 30, as follows:

	2006			2005
	(Dollars in thousands)
Building and equipment	$	6,406		$	6,422
Accumulated amortization		(3,882	)		(3,688	)
Assets under capital leases, net	$	2,524		$	2,734

     Amortization on capital lease assets is included with depreciation expense in the accompanying financial statements.

     The Company and its subsidiaries also lease certain facilities and equipment under operating leases, some of which contain renewal or escalation clauses. Rent expense was approximately $7.8 million, $8.2 million and $6.1 million during fiscal years 2006, 2005, and 2004, respectively. Contingent rentals are not significant. Future minimum payments on capital and operating leases, excluding the acquisition transaction on August 2, 2006, are as follows at June 30, 2006:

	Capital			Operating
	Leases			Leases
	(Dollars in thousands)
2007	$	853		$	6,865
2008		867			6,034
2009		867			4,621
2010		867			2,404
2011		867			1,743
Thereafter		6,936			19,468
Total minimum lease payments		11,257		$	41,135
Less amount representing interest		(5,287	)
Present value of net future lease payments	$	5,970

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Note 8: Employee Benefit Plans

Pension and Post-Retirement Plans

     In conjunction with the fiscal year 1998 acquisitions of The Sun in Lowell, Massachusetts and the Daily News in Los Angeles, California, the Company assumed non-contributory defined benefit pension plans, which covered substantially all the employees at the acquired newspapers. The Sun‘s plan was combined with the frozen plan of New England Newspapers, Inc., a wholly owned subsidiary of the Company. In addition, shortly after the acquisition of Daily News, the Company elected to freeze the plan assumed in conjunction with that acquisition. Accordingly, all current service cost under that plan has been terminated. Until April 1, 2005, participants in the plan assumed in conjunction with the acquisition of The Sun continued to accrue benefits associated with current services, based on years of service and estimated compensation prior to retirement. Effective April 1, 2005, the Company froze the defined benefit plan benefits and recognized a curtailment loss of approximately $0.4 million.

     The Denver Post sponsors two non-contributory defined benefit pension plans, which cover substantially all its current employees. Both plans provide benefits based on employees’ years of service and compensation during the years immediately preceding retirement. The Denver Post also sponsors post-retirement health care and life insurance plans that provide certain union employees and their spouses with varying amounts of subsidized medical coverage upon retirement and, in some instances, continued life insurance benefits until age 65 if the employee retires prior to age 65. Due to the formation of DNA on January 23, 2001, obligations related to the employees of The Denver Post who became employees of DNA were transferred to DNA’s pension plans along with an amount of net pension asset actuarially determined to fund the obligation. The Denver Post editorial employees, terminated vested employees and retired employees continue to be covered by the two non-contributory plans sponsored by The Denver Post as discussed above.

     The Company’s funding policy for all plans is to make at least the minimum annual contributions required by the Employee Retirement Income Security Act of 1974.

     Effective December 31, 2003, the New England Newspapers, Inc., Daily News and one of The Denver Post plans were merged into one master plan: the MediaNews Plan. The Denver Post Guild (union) pension plan remains as a separate plan and a nonqualified pension plan was also created as a result of the plan merger.

     During the fourth quarter of fiscal year 2006, the Company offered early retirement and severance to certain employees of The Denver Post. In conjunction with the early retirement and severance offers, the Company recognized a small curtailment loss and a small amount related to special termination benefits.

     The Company sponsors a post-retirement health care plan for certain former and current Kearns-Tribune, LLC employees that provided subsidized medical coverage for former employees who retired prior to January 1, 2005. Effective January 1, 2005, the Company no longer provides post-retirement health care coverage for the majority of Kearns-Tribune, LLC employees retiring after that date. In conjunction with the partial freeze of this plan, the Company recognized a small curtailment loss.

     Effective July 1, 2003, the Company adopted an executive retiree medical benefit plan, which provides for health care coverage during the retirement for the eligible participants (corporate officers). There are minimum age and years of service criteria for eligibility for benefits under this plan.

     The Company has additional post-employment agreements and obligations, none of which are material individually or in aggregate.

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     The following tables provide a reconciliation of benefit obligations, plan assets and funded status of the Company’s pension and other defined benefit plans as of June 30. The tables also provide the components of net periodic pension cost associated with those plans as of June 30.

	Pension Plans									Other Benefits
	2006			2005			2004			2006			2005			2004
	(Dollars in thousands)
Change in Benefit Obligation
Benefit Obligation at Beginning of Year	$	111,182		$	98,188		$	93,832		$	4,880		$	5,495		$	5,561
Service Cost		1,125			1,038			1,143			557			434			331
Interest Cost		5,679			5,927			5,688			295			327			326
Amendments		160			(720	)		64			49			(128	)		—
Other Adjustments		307			—			—			2,032			—			—
Actuarial Loss (Gain)		(10,257	)		12,561			3,335			2,715			(650	)		(216	)
Benefits Paid		(5,836	)		(5,812	)		(5,874	)		(536	)		(598	)		(507	)
Benefit Obligation at End of Year	$	102,360		$	111,182		$	98,188		$	9,992		$	4,880		$	5,495
Change in Plan Assets
Fair Value of Plan Assets at Beginning of Year	$	82,580		$	81,387		$	77,944		$	—		$	—		$	—
Actual Return on Plan Assets		7,304			4,949			8,539			—			—			—
Company Contributions		1,945			2,056			778			536			598			507
Benefits Paid		(5,836	)		(5,812	)		(5,874	)		(536	)		(598	)		(507	)
Fair Value of Plan Assets at End of Year	$	85,993		$	82,580		$	81,387		$	—		$	—		$	—
Reconciliation of Funded Status
Funded Status	$	(16,367	)	$	(28,602	)	$	(16,801	)	$	(9,992	)	$	(4,880	)	$	(5,495	)
Unrecognized Net Loss		34,770			48,893			37,674			2,953			397			1,117
Unrecognized Prior Service Cost		2,929			3,494			4,376			(136	)		(149	)		—
Net Prepaid (Accrued) Cost	$	21,332		$	23,785		$	25,249		$	(7,175	)	$	(4,632	)	$	(4,378	)
Assumptions as of June 30
Discount Rate		6.25	%		5.25	%		6.25	%		6.25	%		5.25	%		6.25	%
Expected Return on Plan Assets		8.00	%		8.00	%		8.00	%		N/A			N/A			N/A
Rate of Compensation Increase		3.00	%		3.00	%		3.00	%		N/A			N/A			N/A
Components of Net Periodic Cost
Service Cost	$	1,125		$	1,038		$	1,143		$	557		$	434		$	331
Interest Cost		5,679			5,927			5,688			295			326			326
Expected Return on Plan Assets		(6,466	)		(6,369	)		(7,041	)		—			—			—
Amortization of Deferral		416			440			462			(13	)		(6	)		(2	)
Recognized Net Actuarial Loss		2,990			2,040			1,608			31			70			93
Curtailment Loss and Special Termination Benefits		347			443			—			49			27			—
Net Periodic Cost	$	4,091		$	3,519		$	1,860		$	919		$	851		$	748
Amounts Recognized in the Consolidated Balance Sheets Consist of:
Prepaid Benefit Cost	$	11,783		$	—		$	13,979		$	—		$	—		$	—
Accrued Benefit Cost		(16,530	)		(27,545	)		(16,356	)		(7,174	)		(4,632	)		(4,378	)
Intangible Asset		26			3,271			659			—			—			—
Accumulated Other Comprehensive Loss(1)		26,053			48,059			26,967			—			—			—
Net Prepaid (Accrued) Cost	$	21,332		$	23,785		$	25,249		$	(7,174	)	$	(4,632	)	$	(4,378	)
Separate Disclosure for Pension Plans with Accumulated Benefit Obligation and Projected Benefit Obligation in Excess of Plan Assets
Projected Benefit Obligation	$	73,093		$	111,182		$	70,733			N/A			N/A			N/A
Accumulated Benefit Obligation	$	72,574		$	110,124		$	69,451			N/A			N/A			N/A
Fair Value of Plan Assets	$	56,044		$	82,580		$	53,094			N/A			N/A			N/A

(1) The Company’s share of minimum pension liability at DNA (which is unconsolidated) is included as a component of accumulated other comprehensive loss in the Company’s consolidated balance sheet; however, because the Company does not consolidate the related pension plan, the obligation has been excluded from the table. Also, accumulated other comprehensive loss as shown here differs from the accumulated other comprehensive loss as reflected in the consolidated balance sheet and consolidated statements of changes in shareholders’ equity as the consolidated statements reflect the minimum pension liability net of tax.

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     The Company’s estimates of payments to beneficiaries of its pension plans and other benefits are as follows for each fiscal year ended June 30 (in thousands):

	Pension Plans		Other Benefits
2007	$	6,540	$	900
2008		6,540		940
2009		6,550		960
2010		6,760		1,000
2011		6,850		1,000
2012 — 2016		36,710		4,700

     The Company’s pension plan allocations at June 30 were as follows:

	Target			Plan Assets
	Allocations			Years Ended June 30,
	2007			2006			2005
Asset Category:
Equity securities		70.0	%		70.0	%		66.5	%
Debt securities		20.0			19.3			29.3
Other		10.0			10.7			4.2
Total		100.0	%		100.0	%		100.0	%

     The Company’s investment policy is to maximize the total rate of return on plan assets to meet the long-term funding obligations of the plan. Plan assets are invested using a combination of active management and passive investment strategies. Risk is controlled through diversification among multiple asset classes, managers, styles and securities. Risk is further controlled both at the manager and asset level by assigning return targets and evaluating performance against these targets. Equity securities include common stocks of large, medium, and small companies which are predominately U.S. based. Fixed-income securities primarily include securities issued or guaranteed by the U.S. government, mortgage-backed securities and corporate debt obligations. Other includes certain real estate investments.

     The assumptions used in determining the Company’s pension and postretirement benefit obligation can differ from the actual results. As a result of these differences, as well as other external economic factors, the assumptions used are periodically revised and updated. The differences between actual and assumed experience, and the related changes in assumptions, give rise to actuarial gains and losses in the preceding table, which are recognized over the expected service period of active participants. The majority of the current year differences are related to the Company increasing the discount rate used, which decreased the minimum pension liability that is reflected in other comprehensive income. The discount rate used to determine the Company’s future pension obligations is based upon an index of securities with various maturities rated Aa or better as of the respective measurement dates. The increase in compensation levels assumption is based on actual past experience and near-term outlook and only applies to The Denver Post pension plans. The expected long-term rate of return on plan assets is based upon the weighted average expected rate of return and capital market forecasts for each asset class employed.

     The Company expects to contribute approximately $3.0 million to $4.0 million to its defined benefit pension plans in fiscal year 2007, excluding the impact of our August 2, 2006 acquisitions discussed in Note 16: Subsequent Events.

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     Assumed health care cost trend rates can have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effect (in thousands):

	1-Percentage		1-Percentage
	Point Increase		Point Decrease
Effect on total of service and interest cost components	$	125	$	105
Effect on postretirement benefit obligation	$	799	$	698

     The July 1, 2006 assumed trend rate for the increases in health care costs for its post-retirement plans was 10% trending down over five years to an ultimate rate of 5%. The Company’s policy is to fund the cost of providing postretirement health care and life insurance benefits when they are entitled to be received.

Deferred Compensation Plan

     The Company sponsors several nonqualified deferred compensation plans, which are offered to certain employees (principally corporate officers, newspaper publishers and operational executives). The plans allow participants to defer a portion of their compensation, including bonuses on a pre-tax basis. Participants in one plan are eligible for a Company match based on their deferrals into the plan, while participants of another plan are eligible for a discretionary Company contribution award based on operating results. The Company match and discretionary awards are subject to vesting, over a period of ten years from the date of participation in the plans. No vesting occurs until the participant has completed three or five full years in the plan (depending on the specific plan), after which time the participant is 30% or 50% vested; the residual vesting occurs evenly over the remaining period at 10% per year. The Company match is subject to early withdrawal penalties. The compensation deferrals and Company match earn a return based on notional investment elections made by the individual participants. The discretionary Company contribution awards earn a return equal to the Company’s cost of borrowing under its revolving credit agreement, which it may use to fund payments on the deferred compensation obligations. These deferred compensation obligations are recorded in the Company’s consolidated balance sheets as a component of “Other Liabilities” at the vested value of the deferred compensation, plus the applicable return on investment, and amounted to $7.3 million and $5.8 million at June 30, 2006 and 2005, respectively. In some cases, the Company has made investments in cash surrender value life insurance policies, which may be used at the Company’s discretion to fund its deferred compensation liability. The Company’s investments in cash surrender value life insurance policies are recorded in the Company’s consolidated balance sheets as a component of “Other Assets” and amounted to $5.2 million and $3.9 million at June 30, 2006 and 2005, respectively.

Other Retirement Plans

     The Company and several of its newspaper properties participate in retirement/savings plans, and in addition, contribute to several multi-employer plans on behalf of certain union-represented employee groups. The majority of the Company’s full-time employees are covered by one of these plans. Total expense for these plans in the fiscal years ended June 30, 2006, 2005 and 2004, was approximately $4.9 million, $4.6 million and $4.1 million, respectively.

Note 9: Income Taxes

     The income tax provision consists of the following:

	Years Ended June 30,
	2006			2005		2004
	(Dollars in thousands)
Current:
State	$	1,249		$	1,331	$	579
Federal		7,179			1,031		—
Deferred:
State		(19	)		1,167		(43	)
Federal		(4,526	)		16,561		16,430
Net provision	$	3,883		$	20,090	$	16,966

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     A reconciliation between the actual income tax expense (benefit) for financial statement purposes and income taxes computed by applying the statutory Federal income tax rate to financial statement income before income taxes is as follows:

	Years Ended June 30,
	2006			2005			2004
Statutory federal income tax rate		35	%		35	%		35	%
Effect of:
State income tax net of federal benefit		16			3			1
Dividends received deduction		(4	)		(4	)		(1	)
Book/tax basis difference associated with acquisitions and non-deductible acquisition costs		12			—			(2	)
Expenses not deductible for tax purposes		12			1			2
Other, net		7			(1	)		4
Financial statement effective tax rate		78	%		34	%		39	%

Components of the long-term deferred tax assets and liabilities are as follows:

	June 30,
	2006			2005
	(Dollars in thousands)
Deferred tax assets:
Net operating losses and other credits	$	19,529		$	25,991
Deferred employee compensation		8,760			5,379
Notes payable		2,445			2,599
Pensions		1,831			9,531
Option accrual		1,371			1,178
Bad debts		1,640			1,357
Other		1,392			2,009
		36,968			48,044
Valuation allowance		(3,822	)		(4,837	)
Deferred tax assets		33,146			43,207
Deferred tax liabilities:
Fixed assets		16,009			21,152
Intangibles		83,736			50,460
Partnership interests and equity investments		36,750			69,803
Deferred tax liabilities		136,495			141,415
Net deferred tax liabilities	$	103,349		$	98,208

     On February 1, 2006, MediaNews contributed assets including permanent difference goodwill to Prairie Mountain Publishing Company, LLP (“PMP”). The basis of those contributed assets became a component of the Company’s equity investment in PMP. The Company has provided for deferred taxes on the entire investment balance including the goodwill portion that was treated as a permanent difference prior to the contribution. As a result, MediaNews recognized $0.7 million deferred tax expense, the impact of which is included in the rate reconciliation above in the line item “book/tax basis difference associated with acquisitions and non-deductible acquisition costs.”

     The State of Texas enacted a new franchise tax law on May 18, 2006. This new tax law will apply to MediaNews beginning in its fiscal year 2008. Fixed assets depreciation, intangible amortization, and partnership flowthrough are no longer included in the calculation of taxes under the new statute. MediaNews recognized a state tax benefit of $0.9 million for the elimination of Texas deferred tax liability net of federal tax impact. This benefit had the impact of decreasing the Company’s effective state income tax rate net of federal benefit in the rate reconciliation above.

     At June 30, 2006, for financial reporting purposes, the Company has approximately $9.8 million of net operating loss carryforwards (NOLs) for federal tax reporting purposes available to offset its future taxable income, which expire in 2019 through 2025 and $8.9 million of alternative minimum tax credit carryforwards. The Company also has approximately $106.7 million of state NOLs and approximately $4.6 million of state tax credits available to offset future state taxable

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income. The state NOLs expire in 2006 through 2025; the state tax credits expire beginning in 2006. During fiscal year 2006, the Company recorded $0.9 million of deferred tax expense related to the Company’s state NOLs. The expense resulted from the net increase in valuation allowances to reflect state tax attributes that are more likely than not to go unrecognized. This activity had the impact of increasing the Company’s effective state income tax rate net of federal benefit in the rate reconciliation above.

     The impact on the rate reconciliation varies annually based on the relative size of the non-deductible expenses in comparison to the pre-tax book income. In fiscal year 2006, expenses not deductible for tax purposes had the impact of increasing the Company’s federal income taxes by $0.6 million.

     The Company projects it will generate taxable income sufficient to utilize substantially all of the federal net operating loss carryovers before they expire; however, because of several uncertainties surrounding its projections, and the resulting uncertainty as to whether all of the net operating loss carryovers will be used before they expire, the Company has established a valuation allowance at each period end based upon its estimate of net operating loss and state tax credit carryovers that are more likely than not to expire unused.

     The Company made net state and federal income tax payments of approximately $1.2 million, $3.7 million and $1.8 million, during fiscal years 2006, 2005, and 2004, respectively.

Note 10: Hedging Activities

     At times, the Company has entered into newsprint and interest rate swap agreements. As of June 30, 2006, the Company had no outstanding newsprint or interest rate swap agreements.

     The Company had two newsprint swap agreements: one with Enron North America Corp. (“Enron”) and the other with Mirant Americas Energy Marketing LP (“Mirant”). Both newsprint hedges were designated at contract inception as cash flow hedges under SFAS No. 133 and recorded at fair value with changes in the fair value of such contracts, net of income taxes, reported in comprehensive income. The periodic net settlements made under the newsprint swap agreements were reflected in operations in the period the newsprint was consumed. The newsprint swap agreements were subsequently determined to be ineffective hedges when the swap counterparties became invalid due to bankruptcy and the hedges were terminated prior to the original term of the agreements. The Company accounted for the early termination of the swaps in accordance with SFAS No. 133, which required the Company to record a liability and a charge to comprehensive income to reflect the fair value of the derivative instrument as of the date prior to that which the hedges were deemed ineffective. Since a liquid market for the swap agreements did not exist, the valuations of the swaps were based on a discounted cash flow model and projected future newsprint prices. The valuations required significant judgment and were subject to assumptions, most notably estimates of future newsprint prices. The original term of the newsprint swap agreement with Enron expired in December 2009; the swap was determined to be ineffective the date Enron filed bankruptcy (during the Company’s fiscal year 2002). The original term of the newsprint swap agreement with Mirant expired in May 2005; the swap was determined to be ineffective on the date Mirant filed bankruptcy (during the Company’s fiscal year 2004). The amounts in accumulated other comprehensive loss related to these ineffective hedges are being amortized and charged to other (income) expense, net over the original terms of the swap agreements as the forecasted newsprint purchase transactions originally contemplated in the hedging arrangements continue to be probable of occurring. By the end of fiscal year 2005, all accumulated other comprehensive income related to the Mirant swap had been fully amortized. The Enron newsprint swap is being amortized on a straight-line basis. The Mirant newsprint swap was amortized ratably based on the difference between the floating price (based on the Resource Information Systems, Inc. “RISI” price index) and the fixed price of $615.50 per metric ton using nominal metric tons of 6,250 per quarter. Approximately $0.8 million was reclassified from accumulated other comprehensive loss to earnings for each of the years ended June 30, 2006 and 2005 related to these terminated swaps. The Company did not record any liabilities associated with the termination of the swaps, except as required by SFAS No. 133. See Note 11: Commitments and Contingencies for further discussion regarding the settlement of a lawsuit with Mirant over termination of the newsprint swap agreement.

     See Note 6: Long-Term Debt for further discussion regarding the Company’s interest rate swaps.

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Note 11: Commitments and Contingencies

Commitments

     In December 2004, the Company entered into a contract with a newsprint vendor to purchase newsprint based on market price beginning January 1, 2005 (24,000 metric tons for calendar year 2005) and continuing through December 31, 2009 (36,000 metric tons per year for calendar years 2006 - - 2009).

     In December 2005, the Company entered into a contract with a newsprint vendor to purchase 3,150 metric tons of newsprint based on market price beginning December 2005 and continuing through December 31, 2009.

     In fiscal year 1998, in exchange for $2.4 million, the Company granted an option to a third party to purchase substantially all the assets used in the publication of one of the Company’s newspaper properties, which the third party can exercise or put to the Company based on a predetermined formula. At June 30, 2006, the option repurchase price was valued at $6.6 million and is recorded as a component of other long-term liabilities. Changes in the estimated option repurchase price are recorded as a component of other (income) expense, net. The purchase price of the option can increase or decrease significantly each period based on the performance of the publication because a significant component of the option repurchase formula is the twenty-four month trailing cash flows of the publication. If the purchase option is put to the Company (the put became exercisable on January 31, 2003 and expires in 2010), the option repurchase price is due and payable in full. If the option were put to the Company, the Company expects to fund the payment with available borrowings from its bank credit facility. As a result, in accordance with SFAS No. 6, Classification of Short-Term Obligations Expected to be Refinanced, the option repurchase price remains classified in the Company’s balance sheet as long-term.

     The Company is party to a Shareholder Agreement with the Company’s President. The Shareholder Agreement entitles the President, upon termination of his employment following December 31, 2009, by mutual agreement, or as a result of breach by the Company or certain other circumstances, to put to the Company at a price of 100% of the then fair market value (as determined by formula outlined in the Shareholder Agreement) shares of common stock which he owns. The Company also has a call under the Shareholder Agreement to acquire, and the President has a right to put, such shares following termination of his employment under other circumstances, at a price equal to a percentage of fair market value (as determined by formula outlined in the Shareholder Agreement), which increases to 100% on December 31, 2009 (at June 30, 2006, the President has 58,199 shares of Class A common stock and is entitled to 80% of the fair market value). As of June 30, 2006 and 2005, the value of the President’s put, as calculated per terms of the Shareholder Agreement, was estimated to be $14.1 million and $21.0 million, respectively, and is recorded as component of “Putable Common Stock” on the Company’s balance sheet. In the event of his disability, the President also has the right to require MediaNews to purchase his common stock from time to time during his lifetime in an aggregate amount not to exceed $1.0 million in any fiscal year.

     Effective July 1, 2005, the Company amended the employment agreement of Mr. William Dean Singleton, the Company’s Vice Chairman of the Board and Chief Executive Officer. Under the amended employment agreement, Mr. Singleton has the right, in the event of his disability, to require MediaNews to purchase his common stock from time to time during his lifetime in an aggregate amount not to exceed $1.0 million in any fiscal year. At June 30, 2006 and 2005, the total estimated cost (determined actuarially) of the repurchase would be $26.8 million and $27.6 million, respectively, and such amount is recorded as a component of “Putable Common Stock” on the Company’s balance sheet.

     The Company had entered into contractual commitments with regard to the construction of a printing and office facility for the Salt Lake City JOA. As of June 30, 2006, the facilities were operational; however, there are contractual holdbacks and allowances of approximately $2.5 million that remain which are due for work that has been completed and remains subject to testing.

Contingencies

     Prior to and since the Company’s acquisition of Kearns-Tribune, LLC (“Kearns Tribune”) and The Salt Lake Tribune in January 2001, the Company has been involved in various legal actions with Salt Lake Tribune Publishing Company (“SLTPC”), the holder of an option (the “Option Agreement”) to acquire the Tribune Assets (defined as all of the assets used, held for use or usable in connection with the operation and publication of The Salt Lake Tribune). Kearns Tribune holds

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certain assets used in connection with the operation and publication of The Salt Lake Tribune. As of the date of this report, the Company continues to be involved in litigation with SLTPC, primarily concerning the option to purchase the Tribune Assets, the option exercise price, and any damages related to the option exercise. The following is a summary of the ongoing Kearns Tribune litigation as of June 30, 2006:

     On May 31, 2002, the United States District Court for the District of Utah (“District Court”) issued an Order for Summary Judgment ruling that SLTPC held a valid and enforceable option to purchase the Tribune Assets owned by Kearns Tribune. However, the District Court also ruled that one of the key components of the Tribune Assets, stock in the Salt Lake City JOA, was subject to an anti-alienation provision contained in a Joint Operating Agreement (“JOA”) between Kearns Tribune and Deseret News Publishing Company (“Deseret Publishing”). The anti-alienation provision precludes the sale, assignment or transfer of the Salt Lake City JOA stock by either party to the JOA absent a waiver or modification of the provision. Subsequent to the court ruling, Deseret Publishing notified SLTPC that it would not waive or modify the anti-alienation provision or consent to the sale or transfer of the Salt Lake City JOA stock to SLTPC. The District Court certified for immediate appeal to the United States Court of Appeals for the Tenth Circuit the question of whether the anti-alienation provision contained in the Joint Operating Agreement was enforceable, as the District Court held in its Summary Judgment Order. The Tenth Circuit affirmed the District Court ruling that the stock of the Salt Lake City JOA could not be transferred without the consent of Deseret Publishing. However, the Tenth Circuit remanded to the District Court for further proceedings on the issue of whether the Tribune Assets other than the stock of the Salt Lake City JOA could be sold and transferred to SLTPC and remedies could be fashioned that addressed an exclusion of the Salt Lake City JOA stock from the transfer of the Tribune Assets. Potential remedies identified by the Tenth Circuit included: 1) an order of specific performance transferring all the Tribune Assets that can be transferred without triggering the share transfer restriction; 2) damages to compensate SLTPC for the Salt Lake City JOA stock not being transferred; or 3) equitable relief if a damage award would be insufficient to remedy the failure to transfer the Salt Lake City JOA stock. In its opinion, the Tenth Circuit also stated that the District Court could avoid equitable relief altogether and simply award damages to SLTPC if it is found that Kearns Tribune is liable for failing to perform under the Option Agreement.

     Subsequent to the Tenth Circuit’s ruling, SLTPC filed a motion for partial summary judgment seeking a ruling that, at the Closing specified in the Option Agreement, Kearns Tribune is obligated under the Option Agreement to transfer all Tribune Assets except for the Salt Lake City JOA stock. On June 25, 2003, the District Court granted this motion. Based upon this ruling, the District Court also reinstated claims by SLTPC against the Company and Deseret Publishing that a 2001 amendment of the JOA interfered with SLTPC’s rights under the Option Agreement. Regarding SLTPC’s exercise of the option, still reserved for trial is the question of whether, in an event those Tribune Assets (excluding the Salt Lake City JOA stock) are not transferred, SLTPC is entitled to an order that Kearns Tribune specifically perform under the Option Agreement and transfer those Tribune Assets, or limited to a damages remedy. Also remaining for decision at trial is the issue of what additional remedies SLTPC might be entitled to if all Tribune Assets except for the Salt Lake City JOA stock are transferred. A trial date was set for November 3, 2003, but was vacated by the District Court in light of the dispute (discussed below in the next paragraph) over the exercise price should SLTPC acquire the Tribune assets. There is no trial date currently set.

     One issue in dispute is the option exercise price. The terms of the Option Agreement specify an appraisal process for determination of the fair market value of the Tribune Assets. In this appraisal process, each party engaged an appraisal firm to value the Tribune Assets at their fair market value. MediaNews’ appraisal valued the Tribune Assets at $380.0 million, whereas SLTPC’s appraisal valued the Tribune Assets at $218.0 million. Because Kearns Tribune’s and SLTPC’s appraisals were more than 10% apart, the appraisers appointed by Kearns Tribune and SLTPC were required to jointly select a third appraiser. Under the terms of the Option Agreement, the final option purchase price is based on the average of the two closest of the three appraisals. On June 11, 2003, the third appraiser issued its final report valuing the Tribune Assets at $331.0 million. Accordingly, the option exercise price was set at $355.5 million for the Tribune Assets. After the third appraiser’s final report was issued, SLTPC filed a lawsuit in the District Court on June 24, 2003 (the “appraisal lawsuit”), challenging the valuation performed by the third appraiser and seeking to set aside the third appraisal and the $355.5 million exercise price. The District Court ruled that the appraisal process constituted an arbitration under the Federal Arbitration Act (“FAA”) and that any challenge must therefore be made under the procedures set forth in the FAA. The District Court subsequently denied SLTPC’s motion under the FAA procedures seeking to set aside the appraisal, and, as a consequence of its arbitration rulings, also dismissed the appraisal lawsuit. SLTPC appealed the District Court’s rulings to the Tenth Circuit, and on November 30, 2004, the Tenth Circuit reversed the District Court’s rulings. While taking no position on the merits of the dispute as to the finality of the third appraisal and the validity of the $355.5 million exercise price, the Tenth Circuit held

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that the Option Agreement’s appraisal procedure did not constitute arbitration within the meaning of the FAA. The Tenth Circuit accordingly reinstated SLTPC’s appraisal lawsuit.

     In the reinstated appraisal lawsuit, SLTPC filed an amended complaint against MediaNews, Kearns Tribune and the third appraiser, Management Planning Inc. (“MPI”), seeking relief that includes (a) the setting aside of the third appraisal; or (b) alternatively, if the exercise price of $355.5 million is held to be final and binding, (i) monetary damages from the third appraiser for alleged breaches of contractual and fiduciary duties, and (ii) what SLTPC refers to as an “abatement” of the purchase price pursuant to allegations that the value of the Tribune Assets has decreased since SLTPC sought to exercise the option. MediaNews and Kearns Tribune and MPI filed separate motions to dismiss SLTPC’s amended complaint in the appraisal lawsuit. On October 24, 2005, the District Court granted those motions and dismissed the appraisal lawsuit, ruling that SLTPC’s allegations in its amended complaint did not set forth grounds for the invalidation of the third appraisal. SLTPC subsequently filed a motion for reconsideration or, in the alternative, for leave to file a second amended complaint, which the District Court denied on December 7, 2005. SLTPC appealed to the United States Court of Appeals for the Tenth Circuit (“the Tenth Circuit”). On July 19, 2006, the Court of Appeals reversed the District Court, holding that SLTPC had set forth grounds for invalidation of the third appraisal by alleging that MPI had (a) used the wrong definition of Fair Market Value; (b) failed to consider relevant evidence; and (c) failed to comply with professional appraisal standards. The Court of Appeals remanded the case to the District Court for further proceedings to determine if those allegations could be sustained. On August 3, 2006, MediaNews and Kearns Tribune filed a Petition for Rehearing, asking the Court of Appeals to reconsider whether the second and third allegations (failure to consider relevant evidence and failure to comply with professional appraisal standards) were sufficient to challenge the third appraisal. The Court of Appeals ordered SLTPC to respond to the Petition for Rehearing but has not yet ruled on it.

     If the $355.5 million option exercise price is upheld, there remains a dispute as to whether SLTPC has now waived its rights under the Option Agreement to acquire the Tribune Assets at that price. The District Court had set a date of October 10, 2003 (the “Closing Date”) for the closing to occur. On October 9, 2003, counsel for SLTPC sent a letter to counsel for MediaNews and Kearns Tribune notifying Kearns Tribune that SLTPC would not pay the $355.5 million option exercise price, and raised additional objections to the proposed closing documentation; accordingly, no closing occurred on October 10, 2003. MediaNews and Kearns Tribune contend that this was SLTPC’s sole opportunity to close at the $355.5 million price, while SLTPC contends that in light of its objections, it would be entitled to another opportunity to close at that price. It is expected that any dispute over SLTPC’s opportunity for a second closing will be litigated in the main action between the parties (see discussion in the paragraph below).

     During the time in which the appraisal and exercise price issues were on appeal before the Tenth Circuit, SLTPC’s main action was stayed. In the main action, SLTPC’s pending claims against MediaNews and Kearns Tribune include claims for specific performance damages for breach of contract (in the event some or all of the Tribune Assets are not transferred to SLTPC) and for interference with contract (arising out of the amendment of the JOA in 2001). MediaNews and Kearns Tribune have pending counterclaims against SLTPC, which include claims for damages for breaches of contract, breach of fiduciary duty, interference with contract, negligence and conversion. Additionally, MediaNews and Kearns Tribune have pending counterclaims for declaratory judgment, but no damage claims against Deseret News Publishing Company (“Deseret Publishing”). Deseret Publishing has pending claims against SLTPC for damages, and claims that do not seek damages against Kearns Tribune as to the meaning and enforceability of the Option Agreement and related Management and Joint Operating Agreements. Additionally, it is anticipated, depending upon the outcome of the appraisal lawsuit, that the main action may also encompass litigation by the parties concerning whether the Option Agreement expired when SLTPC did not exercise it on October 10, 2003 (as the Company and Kearns Tribune have contended), or whether SLTPC still has the opportunity to exercise the Option Agreement (as SLTPC contends). No schedule has yet been set for the litigation of these issues.

     In related litigation, the Company and Kearns Tribune filed a declaratory judgment against certain members of the McCarthey family who own a majority interest in SLTPC, seeking a ruling that the defendants do not have any rights as individuals (separate from their corporate entity, SLTPC) to purchase or otherwise acquire the Tribune Assets. The defendants have asserted contract, tort and equitable claims based on an alleged oral agreement that they contend gives them the right as individuals (separate from their corporate entity, SLTPC) to purchase the Tribune Assets at a price established through a different appraisal methodology than that employed by MPI. The defendants have also filed a third-party complaint naming as defendants various individuals and entities, including AT&T, Deseret Publishing, and Dirks Van Essen, one of the three appraisers of the Tribune Assets. The Company, Kearns Tribune and all of the third-party defendants filed

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motions seeking summary judgment on all claims. On April 24, 2006, the District Court granted those motions. The McCartheys have appealed, and the case is not yet fully briefed on appeal.

     In January 2002, certain controlling members of SLTPC filed a separate lawsuit in Colorado State Court in Denver in their individual capacities. The lawsuit names all the same defendants, arises from same underlying facts, and seeks overlapping equitable relief and compensatory and punitive damages as the original federal case filed in Utah in the District Court. The Company and the other defendants filed motions seeking to have this lawsuit dismissed or, in the alternative, stayed pending resolution of the federal action. On February 21, 2002, the Colorado court granted the defendants’ motion to stay the Colorado action until the Utah federal court action has been resolved. In January 2003, the Colorado plaintiffs filed a motion to have the stay lifted, which was denied by the Colorado court. Thus, the Colorado action remains stayed until completion of the Utah case.

     The Company is not in a position at this time to predict the likely outcome of this litigation. However, the Company does not believe that the litigation will have a materially adverse impact on its financial condition, results of operations, or liquidity. Approximately $1.3 million, $0.8 million and $2.2 million, respectively, was recorded in other (income) expense, net for the fiscal years ended June 30, 2006, 2005 and 2004, related to the cost of defending these lawsuits. The cost of defending these lawsuits has been and may continue to be substantial.

Other

     MediaNews sent a notice terminating its newsprint swap agreement with Mirant Americas Energy Marketing, LP (“Mirant”) effective September 5, 2003. In March 2005, Mirant filed a lawsuit in U.S. District Court for the Southern District of New York against the Company alleging breach of contract and seeking damages in connection with the swap termination in the amount of approximately $2.0 million, plus interest, costs and attorney’s fees. In March 2006, such motion was denied. In August 2006, the Company reached a settlement agreement with Mirant. Settlement terms under the agreement were accounted for as of June 30, 2006 and did not have a material impact on the financial condition or results of operations of the Company.

     A series of class action lawsuits were filed against entities involved in the electronic display of articles (“Database Entities”) that had previously appeared in newspapers and magazines (collectively, “Media Entities”) and had been authored by individuals who were not employees of the Media Entities. These lawsuits alleged that the Database Entities’ electronic display infringed upon the copyrights owned by the freelance authors. The lawsuits were consolidated into a single action in the Southern District of New York, In re Literary Works in Electronic Databases Copyright Litigation, MDL No. 1379, Consolidated Case No. 00 Civ. 8049 GBD (S.D.N.Y. 2000). MediaNews had licensed articles from its various newspapers to one or more of the Database Entities. Although the Company is not a party to this litigation, various Media Entities have asserted claims for indemnification against the Company in respect of their potential liability in this litigation. In 2004, the Database Entities negotiated a settlement of these consolidated actions, and MediaNews agreed to participate in the settlement process. The settlement provides for a claims settlement process in which a claims administrator would determine the responsibility of the participants taking into account such factors as the availability of defenses, the existence of a copyright registration, the date on which the relevant article was originally published, the amount received by the author of the freelance article for the original publication and the total amount of claims that are compensated. Settlement under the agreement could be significant; however, the Company has not been provided sufficient information to be able to estimate its potential exposure to settling its share of the asserted claims.

     In May 2004, the Company restructured its interests in Charleston Newspapers (“Charleston JOA”) and The York Newspaper Company (“York JOA”). The Company and the other participants in such restructurings subsequently received civil investigative demands from the Department of Justice and provided responsive information and documents concerning the recent restructurings of the Charleston and York JOAs. After discussions with the Antitrust Division staff in 2005, the Company proposed potential amendments to the agreements governing the York JOA to clarify the rights and obligations of the parties to provide for additional performance based compensation to the manager of The York Dispatch under certain circumstances. The proposed amendments remain under review at the Antitrust Division. The Company anticipates that any such amendments would not be material to its future operating results.

     With respect to the Charleston JOA, the Antitrust Division staff continued their investigation in 2005 and 2006. While this investigation remains open, the Company does not anticipate any action by the Antitrust Division would materially affect its future operating results.

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     See Note 16: Subsequent Events regarding a lawsuit filed July 14, 2006 alleging antitrust violations based on the Company’s purchase of certain California newspapers from The McClatchy Company and The Hearst Corporation’s proposed investment in the Company’s non-Bay area assets and the review of the equity investment by Hearst in the Company by the Antitrust Division of the Department of Justice.

     The Company owns certain life insurance policies received in conjunction with an acquisition. In fiscal year 2006, the Company determined one of the policies, with a face value of $5.0 million, relates to an individual who passed away in 2002. While the Company believes it is entitled to the $5.0 million face value proceeds, the Company will record the proceeds when collection is assured.

     The Company is involved in other litigation arising in the ordinary course of business. In management’s opinion, the outcome of these legal proceedings will not have a material adverse impact on its financial condition, results of operations, or liquidity.

Note 12: Related Party Transactions

     The Company is party to a consulting agreement, renewable annually, with Mr. Richard B. Scudder, the Chairman of the Board of MediaNews, which requires annual payments of $300,000.

     From 1996 through July 2002, the Company advanced to the Singleton Irrevocable Trust funds to pay the premiums on cash surrender value life insurance policies covering Mr. William Dean Singleton, the Vice Chairman of the Board and Chief Executive Officer of MediaNews, and his wife. The cash surrender value life insurance policies were originally purchased in order to mitigate the impact of estate taxes that may be due on MediaNews stock held in the Singleton Revocable Trust. The Singleton Revocable Trust benefits Mr. Singleton’s children. The amount advanced as of June 30, 2006 and 2005 was $1.5 million. Advances will be repaid when the policy is surrendered or earlier at Mr. Singleton’s option. No interest is charged on these advances. See Note 11: Commitments and Contingencies for further discussion of Mr. Singleton’s amended employment agreement.

     The Company has an employment and shareholder agreement with the Company’s President. See Note 11: Commitments and Contingencies for further discussion.

     The Company uses Hughes Hubbard & Reed LLP as one of its legal counsel. Mr. Howell E. Begle, Jr., a board member and general counsel of the Company, is Of Counsel to Hughes Hubbard & Reed LLP.

     The Company is party to a management agreement with the California Newspapers Partnership, which prior to being amended as described below provided MediaNews with a management fee of 1.25% of revenues and thereby reducing the Company’s total corporate overhead, the effect of which is a reduction of the impact minority interest expense has on its consolidated statement of operations. In connection with the acquisition of the Contra Costa Times and the San Jose Mercury News, and the related contribution of those publications into the California Newspapers Partnership, the CNP management agreement was revised. Effective August 2, 2006, the revised agreement calls for annual management fees of $5.4 million, subject to annual adjustments based on actual costs and the operating performance of CNP.

     In addition, in connection with the restructuring of the Texas-New Mexico Newspapers Partnership, the Company as managing controlling partner is provided an annual management fee of $75,000 by the partnership, subject to annual adjustment.

     In August 2004, the Company purchased the Colorado residence of Mr. Gerald Grilly (the Company’s Chief Operating Officer at the time) for $2.7 million in conjunction with his relocation to Los Angeles, California. Mr. Grilly’s relocation was requested by MediaNews. In May 2005, the Company sold the residence for $2.5 million.

     See Note 5: Acquisitions, Dispositions and Other Transactions regarding the Company’s purchase of The Park Record in Park City, Utah.

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Note 13: Other (Income) Expense, Net

     Included in other (income) expense, net are the following items:

	Years Ended June 30,
	2006			2005			2004
	(In millions)
Change in estimated option repurchase price	$	—		$	(5.8	)	$	(4.0	)
Hedging, net		0.8			0.4			2.1
Bank fees		0.2			0.7			0.4
Salt Lake ownership litigation		1.3			0.8			2.2
Freedom acquisition bid		—			—			1.0
Debt redemption premiums and write-off of deferred debt costs		—			9.2			9.3
Write-off of KTBY escrow and other prepaid acquisition costs		—			—			1.1
Preferred return on Detroit JOA investment		(2.0	)		—			—
Other		1.1			3.4			5.3
	$	1.4		$	8.7		$	17.4

Note 14: Equity Investments (Non-JOA)

     The following table represents the summary financial data, on a combined basis, for the Company’s non-JOA equity investments (the entities represented in the table below are included at 100%).

	Years Ended June 30,
	2006		2005		2004
	(In thousands)
Current assets	$	64,123	$	57,894	$	58,924
Non-current assets		167,986		192,164		216,640
Current liabilities		35,854		30,117		29,723
Non-current liabilities		47,492		67,404		92,967
Total revenues		257,185		257,816		266,865
Net income		27,405		35,605		30,260

     See Note 4: Investments in California Newspapers Partnership and Texas-New Mexico Newspapers Partnership for discussion of our accounting for the Texas-New Mexico Newspapers Partnership whereby prior to December 26, 2005, the Company accounted for its interest in the partnership as an equity investment. Effective December 26, 2005, the partnership became a consolidated subsidiary of the Company. The Texas-New Mexico Newspapers Partnership results are reflected in the above table through December 25, 2005. Also, beginning February 1, 2006, the results of Prairie Mountain Publishing Company are included above (discussed further in Note 5: Acquisitions, Dispositions and Other Transactions).

Note 15: Career Restricted Stock Unit Plan

     Effective June 29, 2005, the Company adopted a Career Restricted Stock Unit (“RSU”) Plan intended to encourage retention and reward performance of selected senior management of the Company and its affiliates over a significant period of time.

     The RSU Plan is administered by the Company’s board of directors (or a designated committee). The RSU Plan provides for the award to members of senior management selected by the board (or committee) for participation in the Plan of such number of restricted stock units (“RSUs”) at such time or times as determined by the board (or committee) in its discretion. Each RSU represents the right to receive one share of the Company’s new class of Class B common stock (which is non-

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voting and does not pay dividends, but which is convertible into Class A in certain circumstances), subject to vesting and other requirements. RSUs granted to a participant vest upon the later to occur of:

• the earlier of (x) the completion of 20 years of continuous service with the Company or its affiliates or (y) attainment of age 67 while still employed by the Company or its affiliates; or

• the date on which the participant (a) has completed at least five years of participation in the RSU Plan and (b) has a combined age and years of continuous service with the Company and or affiliates of at least 72.

     RSUs also fully vest upon the occurrence of a “Change in Control” (as defined) and vest pro rata in the event of the participant’s death, disability or termination of employment by the Company without cause. Any RSUs not so vested are forfeited upon the participant’s termination of employment, unless otherwise determined by the board (or committee) in its sole discretion.

     Shares of the Company’s Class B common stock are issued to holders of vested RSUs upon the earliest of the participant’s separation from service, the participant’s disability and the occurrence of a “Qualified Change in Control” (as defined).

     Recipients of shares issued pursuant to RSUs have the right to require the Company to repurchase a number of shares at their then fair market value (as determined by formula outlined in the RSU plan) that is sufficient to enable them to pay taxes due in connection with such issuance, provided that the board of directors may suspend such right at any time. At any time following the six-month anniversary of the date of issuance of shares of such Class B common stock, the Company has the right to repurchase such shares at their then fair market value (as determined by formula outlined in the RSU plan). Such repurchase rights will terminate if the Company consummates an initial public offering.

     The issuance of up to 150,000 shares of the Company’s Class B common stock is authorized under the RSU Plan. RSU grants of 10,105 units were made July 14, 2005 to certain executive officers of the Company, the fair value of which was approximately $3.7 million. Approximately $0.6 million was recognized in selling, general and administrative expense in fiscal year 2006 (the tax benefit related thereto was $0.2 million). None of the grants have vested. As of June 30, 2006, the total compensation cost related to nonvested grants not yet recognized was $3.1 million and is expected to be recognized over a weighted average period of 6 years.

Note 16: Subsequent Events

Acquisition

     On August 2, 2006, MediaNews and The McClatchy Company (“McClatchy”) consummated the closing under the Stock and Asset Purchase Agreement dated as of April 26, 2006, between the Company and McClatchy, pursuant to which California Newspapers Partnership, a 54.23% subsidiary of the Company, purchased the Contra Costa Times and the San Jose Mercury News and related publications and Web sites for $736.8 million. The acquisition, including fees, was funded in part with contributions of $340.1 million from the Company’s partners in CNP. The Company’s share of the acquisition, including fees, was approximately $403.0 million and was funded with borrowings under a new term loan “C” and its existing bank revolver (see Note 16: Subsequent Events — Credit Agreement Amendment)

     On August 2, 2006, Hearst and McClatchy consummated the closing under the Stock and Asset Purchase Agreement dated as of April 26, 2006, between Hearst and McClatchy, pursuant to which Hearst purchased The Monterey County Herald and the St. Paul Pioneer Press and related publications and Web sites for $263.2 million.

Hearst Stock Purchase Agreement

     On August 2, 2006, MediaNews and The Hearst Corporation (“Hearst”) entered into a Stock Purchase Agreement (the “MediaNews/Hearst Agreement”) pursuant to which (i) Hearst agreed to make an equity investment of up to $299.4 million (subject to adjustment under certain circumstances) in the Company (such investment will not include any governance or economic rights or interest in the Company’s publications in the San Francisco Bay area) and (ii) the Company has agreed to purchase from Hearst The Monterey County Herald and the St. Paul Pioneer Press with a portion of the Hearst equity investment in the Company. The equity investment will afford Hearst an equity interest of approximately 30% (subject to adjustment in certain circumstances) in the Company after excluding its economic interest in the San Francisco Bay area newspapers. The equity investment by Hearst in the Company is subject to antitrust review, currently underway by the Antitrust Division of the Department of Justice. The Antitrust Division has requested information and documents in

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connection with this review, and the Company is in the process of responding to the request. The Company has agreed to manage The Monterey County Herald and the St. Paul Pioneer Press during the period of their ownership by Hearst, with the Company retaining all the net cash flows from these newspapers as a management fee. The Company also agreed that at the election of MediaNews or Hearst, the Company will purchase The Monterey County Herald and the St. Paul Pioneer Press, if requested, from Hearst for $263.2 million (plus reimbursement of Hearst’s cost of funds in respect of its purchase of such newspapers) if for any reason Hearst’s equity investment in the Company is not consummated within six months. The Company would need to obtain additional financing to fund this purchase, if required.

Litigation

     On July 14, 2006, an individual filed suit against the Company in California alleging antitrust violations based on the Company’s purchase of certain California newspapers from McClatchy and Hearst’s proposed investment in the Company’s non-Bay area assets. The individual sought a temporary restraining order enjoining the Company from acquiring these newspapers and enjoining Hearst’s proposed investment in the Company’s non-Bay area assets, which the court denied in full on July 28, 2006. The Company is contesting all of the individual’s substantive claims vigorously. Trial is scheduled for February 2007. If the Company loses on one or more counts, it could be required to divest one or more of the acquired newspapers, and/or the Hearst investment in the Company’s non-Bay area assets could be enjoined. In addition, if the Company loses on any count, it may have to pay the complainant’s reasonable legal costs as provided by statute.

Credit Agreement Amendment

     On August 2, 2006, the Company entered into an amendment to its December 30, 2003 bank credit facility (the “amended facility”). The amended facility was entered into in order to authorize a new $350.0 million term loan “C” facility and to approve the purchase of the Contra Costa Times, San Jose Mercury News, The Monterey County Herald and the St. Paul Pioneer Press by the Company.

     The amended facility maintains the $350.0 million revolving credit facility, the $100.0 million term loan “A”, the $147.3 million term loan “B” facility, and provides for the $350.0 million term loan “C” facility, which was borrowed on August 2, 2006 and used, along with borrowings under the Company’s bank revolver of $56.3 million, to fund the remainder of its portion of the purchase price for the Contra Costa Times and the San Jose Mercury News and the related fees to amend the facility.

     Term loan “C” bears interest based upon, at the Company’s option, Eurodollar, plus a borrowing margin of 1.75%, or base rate, plus a borrowing margin of .75%. Term loan “C” requires quarterly principal payments as follows: $0.875 million through June 2012; and $82.25 million from June 2012 through March 2013, with the remaining balance due at maturity on August 2, 2013. Amounts repaid under the term loan “C” facility will not be available for re-borrowing.

     The amended facility also contained certain definitional changes used in calculating the maximum consolidated debt to consolidated operating cash flow ratio as well as increasing the maximum coverage ratio for certain future periods.

     The Company paid approximately $4.6 million to amend the facility, which included $1.0 million for the lender to back-stop the commitment for the borrowing.

Commitments

     On August 24, 2006, in connection with the previously described series of transactions involving MediaNews, Hearst and McClatchy, the Company awarded bonuses to certain of its officers and employees in the aggregate amount of approximately $1.9 million.

     On August 24, 2006, the Company and Gerald E. Grilly, Executive Vice President and Chief Operating Officer of the Company, agreed that Mr. Grilly would retire from the Company effective August 31, 2006. In connection therewith, Mr. Grilly will receive severance of $1.25 million payable over three years, $150,000 bonus associated with the August 2, 2006 acquisition as well as $250,000 in connection with the Company’s long-term compensation plans.

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Building Sale

     In July 2006, the Company sold its office building in Long Beach, California for approximately $20.0 million. The Company expects to recognize a gain on the sale of the building. In conjunction with the sale of the building, the Company entered into a 15-year lease agreement for space to house its Long Beach operations. The lease term commences once the new space is ready to be occupied, which is expected to be in the second quarter of the Company’s fiscal year 2007. The expected minimum lease payments are included in the disclosure of future minimum payments for operating leases in Note 7: Leases.

Original Apartment Magazine

     In September 2006, the California Newspapers Partnership agreed to sell the Original Apartment Magazine for $14.0 million plus a potential earnout of $1.0 million based on increases in the Original Apartment Magazine’s revenue over a twelve month period ending August 2007. The expected closing date is September 29, 2006.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	MEDIANEWS GROUP, INC.
Date: September 26, 2006	By:	/S/ Ronald A. Mayo
		Ronald A. Mayo
		Vice President and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the registrant in the capacities and on the dates indicated.

SIGNATURE	TITLE	DATE
/S/ Richard B. Scudder (Richard B. Scudder)	Chairman and Director	September 26, 2006
/S/ Jean L. Scudder (Jean L. Scudder)	Director	September 26, 2006
/S/Howell E. Begle, Jr. (Howell E. Begle, Jr.)	Director	September 26, 2006
/S/William Dean Singleton (William Dean Singleton)	Vice Chairman, Chief Executive Officer and Director (Chief Executive Officer)	September 26, 2006
/S/ Joseph J. Lodovic, IV (Joseph J. Lodovic, IV)	President	September 26, 2006
/S/ Ronald A. Mayo (Ronald A. Mayo)	Vice President and Chief Financial Officer	September 26, 2006
/S/ Michael J. Koren (Michael J. Koren)	Vice President and Controller (Principal Accounting Officer)	September 26, 2006

Supplemental Information to be Furnished with Reports Filed
Pursuant to Section 15(d) of the Act by Registrants Which Have Not
Registered Securities Pursuant to Section 12 of the Act

     No annual report or proxy material has been sent to our security holders. We will furnish to our security holders an annual report subsequent to this filing.

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EXHIBIT INDEX

Exhibits
2.1	Stock and Asset Purchase Agreement dated as of April 26, 2006, between MediaNews Group, Inc. and The McClatchy Company (incorporated by reference to Exhibit 99.1 to the registrant’s Form 8-K filed May 1, 2006)
2.2	Stock and Asset Purchase Agreement dated as of April 26, 2006, between The Hearst Corporation and The McClatchy Company (incorporated by reference to Exhibit 99.2 to the registrant’s Form 8-K filed May 1, 2006)
3.1	Third Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the registrant’s June 30, 2005 Form 10-K)
3.2	Amended and Restated Bylaws of MediaNews Group, Inc. (incorporated by reference to Exhibit 3.2 to the registrant’s June 30, 2005 Form 10-K)
4.1	Registration Rights Agreement dated May 20, 1994, between Affiliated Newspapers Investments, Inc. (the predecessor to the registrant) and BT Securities Corporation (incorporated by reference to Exhibit 4.3 to Form S-1/A of Affiliated Newspapers Investments, Inc., filed May 6, 1994 (File No. 33-75158))
4.2	Indenture dated as of November 25, 2003 between MediaNews Group, Inc., as Issuer, and The Bank of New York, as Trustee (incorporated by reference to Exhibit 4.4 to the registrant’s Form 8-K filed January 14, 2004)
4.3	Form of MediaNews Group, Inc.’s 6 7/8% Senior Subordinated Notes due 2013 (contained in the Indenture filed as Exhibit 4.4 to the registrant’s Form 8-K filed January 14, 2004)
4.4	Indenture dated as of January 26, 2004 between MediaNews Group, Inc., as Issuer, and The Bank of New York, as Trustee (incorporated by reference to Exhibit 4.4 to the registrant’s From 10-Q for the period ended December 31, 2003)
4.5	Form of MediaNews Group, Inc.’s 6 3/8% Senior Subordinated Notes due 2014 (contained in the Indenture filed as Exhibit 4.4 to the registrant’s Form 10-Q for the period ended December 31, 2003)
10.1	Credit Agreement dated as of December 30, 2003 by and among MediaNews Group, Inc., the guarantors named therein, the lenders named therein, and Bank of America, N.A., as administrative agent (the “Credit Agreement”) (incorporated by reference to Exhibit 10.1 to the registrant’s Form 8-K filed January 14, 2004)
10.2	First Amendment to Credit Agreement, dated as of January 20, 2004, by and among MediaNews Group, Inc., the guarantors named therein, the lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.12 to the registrant’s Form S-4 filed February 23, 2004)
10.3	Second Amendment to Credit Agreement, dated as of April 16, 2004, by and among MediaNews Group, Inc., the guarantors named therein, the lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.3 to the registrant’s June 30, 2004 Form 10-K)
10.4	Third Amendment to Credit Agreement, dated as of August 30, 2004, by and among MediaNews Group, Inc., the guarantors named therein, the lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.4 to the registrant’s June 30, 2004 Form 10-K)
10.5	Fourth Amendment to Credit Agreement, dated as of September 8, 2005, by and among MediaNews Group, Inc., the guarantors named therein, the lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 10.5 to the registrant’s June 30, 2005 Form 10-K)
10.6	Fifth amendment to Credit Agreement dated as of June 28, 2006, by and among MediaNews Group, Inc., the guarantors party thereto, the lenders named therein and Bank of America, N.A., as administrative agent
10.7	Sixth Amendment to Credit Agreement dated as of August 2, 2006, by and among MediaNews Group, Inc., the guarantors party thereto, the lenders named therein and Bank of America, N.A., as administrative agent (incorporated by reference to Exhibit 99.2 to the registrant’s Form 8-K filed August 8, 2006)
10.8	Amended and Restated Shareholders Agreement of MediaNews Group, Inc. by and among MediaNews Group, Inc. and the shareholders named therein, effective as of January 31, 2000, and amended and restated as of March 16, 2004 (incorporated by reference to Exhibit 10.7 to the registrant’s Form S-4/A (File No. 333-113028), filed March 18, 2004)

91

EXHIBIT INDEX (continued)

Exhibits
(continued)
10.9	Amendment to the Amended and Restated Shareholders Agreement of MediaNews Group, Inc. dated as of June 30, 2005, by and among MediaNews Group, Inc. and the shareholders named therein, effective as of January 31, 2000, and amended and restated as of March 16, 2004 (incorporated by reference to Exhibit 10.7 to the registrant’s June 30, 2005 Form 10-K)
10.10	Employment Agreement dated July 1, 2005 between MediaNews and William Dean Singleton (incorporated by reference to Exhibit 99.2 to the registrant’s Form 8-K filed July 5, 2005)
10.11	Employment Agreement dated July 1, 2005 between MediaNews and Joseph J. Lodovic IV (incorporated by reference to Exhibit 99.3 to the registrant’s Form 8-K filed July 5, 2005)
10.12	Amended and Restated Joint Operating Agreement, dated as of April 30, 2004 by and between York Newspapers, Inc., York Newspapers Holdings, Inc., The York Newspaper Company, York Newspapers Holdings, L.P. and York Dispatch Publishing Company, LLC (incorporated by reference to Exhibit 10.8 to the registrant’s June 30, 2004 Form 10-K)
10.13	Singleton Family Voting Trust Agreement for MediaNews Group, Inc. dated January 31, 2000 (incorporated by reference to Exhibit 10.21 to the registrant’s Form 10-Q for the period ended March 31, 2000)
10.14	Scudder Family Voting Trust Agreement for MediaNews Group, Inc. dated January 31, 2000 (incorporated by reference to Exhibit 10.22 to the registrant’s Form 10-Q for the period ended March 31, 2000)
10.15	Amendment and Restatement of Agreement, by and between Kearns-Tribune, LLC and Deseret News Publishing Company, dated as of July 1, 2006
10.16	Limited Liability Company Operating Agreement of Newspaper Agency Company, LLC dated as of July 1, 2006
10.17	Option Purchase Agreement between Garden State Newspapers, Inc., the predecessor of MediaNews Group, Inc., and Greenco, Inc., dated as of January 30, 1998 (incorporated by reference to Exhibit 10.13 to the registrant’s Form S-4 filed February 23, 2004)
10.18	Joint Operating Agreement by and between The Denver Post Corporation, Eastern Colorado Production Facilities, Inc., The Denver Newspaper Agency LLP and The Denver Publishing Company, dated as of May 11, 2000 (incorporated by reference to Exhibit 10.14 to the registrant’s Form S-4 filed February 23, 2004)
10.19	First Amendment to the Joint Operating Agreement by and among The Denver Post Corporation, Eastern Colorado Production Facilities, Inc., The Denver Newspaper Agency LLP and The Denver Publishing Company, dated January 22, 2001 (incorporated by reference to Exhibit 10.15 to the registrant’s Form S-4 filed February 23, 2004)
10.20	Limited Liability Partnership Agreement of The Denver Newspaper Agency LLP dated as of January 22, 2001 (incorporated by reference to Exhibit 10.16 to the registrant’s Form S-4 filed February 23, 2004)
10.21	Second Amended and Restated Partnership Agreement for Texas-New Mexico Newspapers Partnership, a Delaware general partnership, by and among Gannett Texas L.P. and Northwest New Mexico Publishing Company
10.22	Third Amended and Restated Partnership Agreement for California Newspapers Partnership, a Delaware General Partnership, by and among West Coast MediaNews LLC; Stephens California Media; The Sun Company of San Bernardino, California; California Newspapers, Inc.; Media West—SBC, Inc. and Media West—CNI, Inc., dated as of August 2, 2006
10.23	Purchase Agreement, dated as of April 30, 2004, between Buckner News Alliance, Inc., MediaNews Group, Inc., York Newspapers Holdings, LLC, MediaNews Group Interactive and York Daily Record LLC and related side letter (incorporated by reference to Exhibit 10.20 to the registrant’s June 30, 2004 Form 10-K)

92

EXHIBIT INDEX (continued)

Exhibits
(continued)
10.24	Master Restructuring and Purchase Agreement, dated as of May 7, 2004, among Daily Gazette Company, MediaNews Group, Inc., Charleston Publishing Company and Charleston Newspapers (incorporated by reference to Exhibit 10.21 to the registrant’s June 30, 2004 Form 10-K)
10.25	Stock Purchase Agreement dated January 4, 2005, by and among MediaNews Group, Inc., as purchaser, and The Singleton Family Revocable Trust and Peter Bernhard, as sellers (incorporated by reference to Exhibit 10.1 to the registrant’s Form 10-Q for the period ended December 31, 2004)
10.26	MediaNews Group, Inc. Career RSU Plan (incorporated by reference to Exhibit 99.1 to the registrant’s Form 8-K filed July 5, 2005)
10.27	Shareholder Agreement dated as of July 1, 2005, as amended as of September 22, 2005, by and among MediaNews Group, Inc. and Joseph J. Lodovic, IV (incorporated by reference to Exhibit 10.24 to the registrant’s June 30, 2005 Form 10-K)
10.28	Agreement dated April 26, 2006 between MediaNews Group, Inc. and The Hearst Corporation (incorporated by reference to Exhibit 99.3 to the registrant’s Form 8-K filed May 1, 2006)
10.29	Agreement dated April 26, 2006 between MediaNews Group, Inc., Gannett Co., Inc., and Stephens Group, Inc. (incorporated by reference to Exhibit 99.4 to the registrant’s Form 8-K filed May 1, 2006)
10.30	Stock Purchase Agreement dated as of August 2, 2006 between MediaNews Group, Inc. and The Hearst Corporation (incorporated by reference to Exhibit 99.1 to the registrant’s Form 8-K filed August 8, 2006)
21.1	Subsidiaries of MediaNews Group, Inc.
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.3	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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MEDIANEWS GROUP, INC. AND SUBSIDIARIES

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS

FISCAL YEARS ENDED JUNE 30, 2006, 2005 AND 2004

	Balance at		Additions					Acquisitions
	Beginning of		Charged to		Net			(Dispositions),		Balance at
	Period		Expense, Net		Deductions			Net		End of Period
	(In thousands)
YEAR ENDED JUNE 30, 2006
Reserves and allowances deducted from asset accounts:
Allowance for doubtful accounts	$	6,901	$	9,893	$	(8,091	)	$	579	$	9,282
YEAR ENDED JUNE 30, 2005
Reserves and allowances deducted from asset accounts:
Allowance for doubtful accounts	$	7,625	$	8,065	$	(8,874	)	$	85	$	6,901
YEAR ENDED JUNE 30, 2004
Reserves and allowances deducted from asset accounts:
Allowance for doubtful accounts	$	7,887	$	7,405	$	(7,668	)	$	1	$	7,625

See notes to consolidated financial statements.

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EX-10.6

Exhibit 10.6

FIFTH AMENDMENT TO CREDIT AGREEMENT

     THIS FIFTH AMENDMENT TO CREDIT AGREEMENT (this “Amendment”), dated as of June 28, 2006, is by and among MediaNews Group, Inc. (the “Borrower”), the guarantors identified on the signature pages hereto (the “Guarantors”), the Lenders parties hereto and Bank of America, N.A., and administrative agent for the Lenders (in such capacity, the “Administrative Agent”).

RECITALS

     A. The Borrower, the Guarantors, the Lenders and the Administrative Agent entered into that certain Credit Agreement dated as of December 30, 2003, as amended pursuant to First Amendment to Credit Agreement dated as of January 20, 2004, as further amended pursuant to Second Amendment to Credit Agreement dated as of April 16, 2004, as further amended pursuant to Third Amendment to Credit Agreement dated as of August 30, 2004 and as further amended pursuant to Fourth Amendment to Credit Agreement dated as of September 8, 2005 (as previously amended, the “Existing Credit Agreement”). Capitalized terms used herein which are not defined herein and which are defined in the Existing Credit Agreement shall have the same meanings as therein defined.

     B. The Loan Parties have requested that certain provisions of the Existing Credit Agreement be amended; and

     C. The parties hereto have agreed to amend the Existing Credit Agreement as set forth herein.

     NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

AGREEMENT

     1. Amendments to Existing Credit Agreement. Effective upon satisfaction of the conditions precedent set forth in Section 2 below, the Existing Credit Agreement is hereby amended as follows:

     (A) The definition of “Operating Cash Flow” appearing in Section 1.01 of the Existing Credit Agreement is hereby amended and restated in its entirety to read as follows

     “Consolidated Operating Cash Flow” means, as of any date of determination with respect to the Borrower and its Restricted Subsidiaries on a consolidated basis, the following, with respect to the immediately preceding four fiscal quarters of the Borrower for which the Required Financial Information has been delivered: (A) revenues minus (B) the sum of (i) cost of sales, (ii) management fees, (iii) regularly scheduled payments in respect of the Denver Synthetic Lease and (iv) selling, general and administrative expenses (other than non-cash expenses accrued under employee compensation and stock ownership plans and post-retirement executive medical plans) for such period plus (C) dividends or other distributions received in cash from any Person (other than a JOA or the Salt Lake Printer Entity) not constituting a Restricted Subsidiary hereunder for such period plus (D) severance expenses for such period not to exceed (i) $250,000 for the fiscal quarter ended September 30, 2005, (ii) $135,000 for the fiscal quarter ended December 31, 2005, (iii) $135,000 for fiscal quarter ended March 31, 2006,

(iv) $1,335,000 for the fiscal quarter ended June 30, 2006 and (v) $500,000 for the fiscal quarter ended September 30, 2006.

     (B) The second paragraph of Section 4.01 of the Existing Credit Agreement is hereby amended and restated in its entirety to read as follows:

     Notwithstanding any provision to the contrary contained herein or in any other of the Loan Documents or Swap Contracts, (a) the obligations of each Guarantor under this Agreement and the other Loan Documents shall be limited to an aggregate amount equal to the largest amount that would not render such obligations subject to avoidance under the Debtor Relief Laws or any comparable provisions of any applicable state law, (b) the liability of Los Angeles Daily News pursuant to this Article IV shall be limited to the maximum amount permitted under the Greenco Option Agreement as in effect on the Closing Date and (c) prior to the time, if any, that the California Partnership, TNMP, MNG/Power One Media Holding Company, Inc., the Salt Lake JOA, Utah Media Partners, LLC or any of their respective Subsidiaries (including Persons which become Subsidiaries after the Closing Date pursuant to a Permitted Investment) becomes a Wholly Owned Subsidiary, such Person shall not be required to Guarantee all or any portion of the Obligations (or enter into a Pledge Agreement).

     (C) Section 8.19(a) of the Existing Credit Agreement is hereby amended and restated in its entirety to read as follows:

     (a) Consolidated Total Leverage Ratio. Permit the Consolidated Total Leverage Ratio at any time during a period set forth below to be greater than the ratio set forth opposite such period:

Period	Ratio
Closing Date through June 30, 2004	6.00 to 1.0
July 1, 2004 through June 30, 2005	5.75 to 1.0
July 1, 2005 through December 31, 2006	5.50 to 1.0
January 1, 2007 through June 30, 2007	5.25 to 1.0
July 1, 2007 through June 30, 2008	5.00 to 1.0
Thereafter	4.50 to 1.0

     (D) Section 8.21 of the Existing Credit Agreement is hereby amended and restated in its entirety to read as follows:

     After the Closing Date, acquire any interest in, or enter into, any JOA (other than the New Salt Lake JOA and Utah Media Partners, LLC, interests in which need not be pledged pursuant to Section 7.04) or the Salt Lake Printer Entity unless (a) the Capital Stock thereof or other interests therein shall be pledged pursuant to the Collateral Documents or (b) the Capital Stock thereof or other interests therein shall be owned directly by a newly formed corporation or limited liability company that (i) shall have no assets other than its interest in such JOA or the Salt Lake Printer Entity, (ii) shall have no other liabilities other than its obligations as a Guarantor hereunder and as a holder of its interest in such JOA or the Salt Lake Printer Entity and (iii) shall have become a Guarantor pursuant to Section 7.04 and the Borrower and its Restricted Subsidiaries shall have granted a security interest in its interest in their Capital Stock in such newly formed

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corporation or limited liability company to the Administrative Agent, for the benefit of the Lenders, in each case, accordance with Section 7.08.

     2. Conditions Precedent. This Amendment shall become effective as of the date hereof upon satisfaction of the following conditions precedent:

     (A) Counterparts of Amendment. The Administrative Agent shall have received counterparts of this Amendment, which collectively shall have been duly executed on behalf of each of the Borrower, the Guarantors, and the Required Lenders.

     (B) Payment of Fees and Expenses. The Borrower shall have paid all fees required to be paid to BAS in connection with this Amendment and all Attorney Costs of the Administrative Agent to the extent invoiced prior to or on the date hereof.

     3. Representations and Warranties. The Borrower hereby represents and warrants to the Administrative Agent and the Lenders that, after giving effect to this Amendment, (a) the representations and warranties set forth in Article VI of the Existing Credit Agreement are, subject to the limitations set forth therein, true and correct in all material respects as of the date hereof (except for those which expressly relate to an earlier date) and (b) no Default or Event of Default exists under the Existing Credit Agreement or any of the other Loan Documents.

     4. Reaffirmation of Obligations. Each Loan Party hereby ratifies the Existing Credit Agreement and acknowledges and reaffirms (a) that it is bound by all terms of the Existing Credit Agreement applicable to it and (b) that it is responsible for the observance and full performance of its respective Obligations. Without limiting the generality of the foregoing sentence, each of the Guarantors hereby (x) jointly and severally reaffirms and ratifies its guaranty of the Obligations pursuant to Article IV of the Existing Credit Agreement, and (y) jointly and severally reaffirms and ratifies all agreements set forth in such Collateral Documents securing such guaranty, all of which shall in all respects remain in full force and effect and shall continue to guarantee and secure any and all of the Obligations, whether now existing or hereafter arising, on the same terms and conditions as are now set forth in such Collateral Documents.

     5. References in Other Loan Documents. At such time as this Amendment shall become effective pursuant to the terms of Section 2 above, all references in the Loan Documents to the “Credit Agreement” shall be deemed to refer to the Existing Credit Agreement as amended by this Amendment.

     6. Counterparts/Telecopy. This Amendment may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the same agreement. This Amendment may be transmitted and/or signed by facsimile. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually signed originals and shall be binding on all Loan Parties, the Administrative Agent and the Lenders. The Administrative Agent may also require that any such documents and signatures be confirmed by a manually signed original thereof; provided, however, that the failure to request or deliver the same shall not limit the effectiveness of any facsimile document or signature.

     7. Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.

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     8. Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

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     IN WITNESS WHEREOF the Borrower, the Guarantors and the Required Lenders have caused this Amendment to be duly executed on the date first above written.

BORROWER:	MEDIANEWS GROUP, INC.,
	a Delaware corporation
	By:	/s/ Ronald A. Mayo
	Name: Ronald A. Mayo
	Title: Vice President and Chief Financial Officer
GUARANTORS:	ALASKA BROADCASTING COMPANY, INC., an Alaska corporation CHARLESTON PUBLISHING COMPANY, a Delaware corporation CONNECTICUT NEWSPAPERS PUBLISHING COMPANY, a Delaware corporation THE DENVER POST CORPORATION, a Delaware corporation THE DETROIT NEWS, INC., a Michigan corporation EASTERN COLORADO PRODUCTION FACILITIES, INC., a Delaware corporation EASTERN COLORADO PUBLISHING COMPANY, a Delaware corporation FITCHBURG INTERNET MEDIA PUBLISHING COMPANY, INC., a Delaware corporation GRAHAM NEWSPAPERS, INC., a Delaware corporation KEARNS-TRIBUNE, LLC, a Delaware limited liability company LONG BEACH PUBLISHING COMPANY, a Delaware corporation LOS ANGELES DAILY NEWS PUBLISHING COMPANY, a Delaware corporation LOWELL INTERNET MEDIA PUBLISHING COMPANY, INC., a Delaware corporation LOWELL PUBLISHING COMPANY, a Delaware corporation
	By:	/s/ Ronald A. Mayo
	Name: Ronald A. Mayo
	Title: Vice President and Chief Financial Officer

1

MEDIANEWS GROUP INTERACTIVE, INC., a Delaware corporation MEDIANEWS SERVICES, INC., a Delaware corporation NEW ENGLAND INTERNET MEDIA PUBLISHING, INC., a Delaware corporation NEW ENGLAND NEWSPAPERS, INC., a Delaware corporation TNP PUBLISHING LLC, a Delaware limited liability company NIMITZ PAPER COMPANY, a Delaware corporation NORTHWEST NEW MEXICO PUBLISHING COMPANY, a Delaware corporation RATE WATCH, INC., a Delaware corporation UTAH MEDIA, INC., a Delaware corporation WEST COAST MEDIANEWS LLC, a Delaware limited liability company
By:	/s/ Ronald A. Mayo
Name: Ronald A. Mayo
Title: Vice President and Chief Financial Officer

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EX-10.15

Exhibit 10.15 EXECUTION VERSION

AMENDMENT AND RESTATEMENT OF AGREEMENT

     This document entered into as of the 1^st day of July 2006 constitutes an amendment of the Agreement dated August 12, 1952 between Salt Lake Tribune Publishing Company, a West Virginia corporation, and Deseret News Publishing Company, a Utah corporation, as amended by a certain Amendment Agreement dated June 1, 1982 entered into between Kearns-Tribune Corporation, a Utah corporation (successor to Salt Lake Tribune Publishing Company) and Deseret News Publishing Company, a Utah corporation, and made effective January 1, 1983 and as further amended and restated by an Amendment and Restatement of Agreement dated as of January 1, 2001 (the “2001 JOA”). This document also constitutes a restatement of the 2001 JOA, as herein amended, and is intended by the parties to define their current agreement, into which all prior agreements, amendments, understandings and interpretations related hereto are hereby merged and herein subsumed.

Parties

     The parties to this Amendment and Restatement of Agreement (herein “Agreement”) are:

     A. Kearns-Tribune, LLC., a Delaware limited liability company (herein “K-T, LLC”), the successor by mergers and otherwise to Kearns-Tribune Corporation, thereby succeeding to ownership of The Salt Lake Tribune, a daily newspaper. All of the member interests in K-T, LLC are owned by MediaNews Group, Inc., a Delaware corporation (herein “MNG”); and

     B. Deseret News Publishing Company, a Utah corporation (herein “DNPC”), which owns and publishes the Deseret Morning News, a daily newspaper.

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Recitals

     The parties hereto and their predecessors have since 1952, and continuing until their execution of this July 1, 2006 Amendment and Restatement of this Agreement, been engaged in a joint newspaper operating arrangement for the purpose of providing, for the benefit of both parties and of the public they serve, an economical, efficient and practical method of printing and distributing daily newspapers, primarily in the State of Utah, through a common agency formerly known as the Newspaper Agency Corporation, a Utah corporation created for that purpose, which has recently been renamed as NAC, Inc. Each of the parties owns fifty (50) shares of the capital stock of NAC, Inc., comprising all of the outstanding shares of that corporation.

     The parties have jointly caused to be formed the Newspaper Agency Company, LLC, a Utah limited liability company (“NAC”), and have by this Amendment and Restatement of Agreement jointly engaged the NAC hereinafter to carry out various responsibilities regarding their joint newspaper operating arrangement, in lieu of having these responsibilities continue to be carried out by the Newspaper Agency Corporation.

     Since the parties entered into the 1952 Agreement, the Congress of the United States declared in the Newspaper Preservation Act of 1970, Publ. L. 910353, 84 Stat. 467, Title 15, Chapter 43, U.S.C.A. (the “Newspaper Preservation Act”) that it is in the public interest to maintain newspapers editorially and reportorially independent and competitive and to preserve the publication of newspapers where a joint newspaper operating arrangement has been entered into under circumstances of economic distress as experienced by the parties at the time the 1952 Agreement was entered into.

     The parties believe that (a) the policy of the United States has confirmed the wisdom of the parties in entering into the 1952 Agreement, under which the advantages of such joint

3

newspaper operating arrangement and common agency have been enjoyed by the public and the parties hereto, (b) the newspapers published by the respective parties have continued to maintain their separate identities and the parties hereto have continued to retain direct and immediate control of their respective editorial and news departments, (c) there has not been any merger, combination or amalgamation of editorial or reportorial staffs, and (d) editorial policies have been independently determined and expressed.

     Certain clarifications concerning interpretation of the 2001 JOA, and certain amendments thereto, are mutually desired by the parties, and a full restatement of the agreements into one document will facilitate their understanding and administration.

     The parties, believing it is desirable both from their standpoint and in the interest of the public that such amendments, clarifications and restatement be made and the benefits thereof be provided and continued, therefore desire to amend, renew and restate their agreements as set forth herein.

     NOW, THEREFORE, in consideration of the sum of One Dollar ($1.00) in hand paid by each of the parties to the other, and the promises, covenants and agreements hereinafter set forth, the parties, based upon mutual trust and confidence in each other, agree to and hereby amend, renew and restate the 2001 JOA, and further agree as follows:

4

Preamble

     The parties hereto declare and reaffirm as the principal objective of this Agreement their joint and several commitment to the survival and success of both the Deseret Morning News and The Salt Lake Tribune as independent editorial voices, with the ultimate goal for each newspaper of achieving optimal household penetration and maximizing the circulation of each newspaper, while allowing both newspapers to reap the financial benefits and economies from the able management of a joint operating system.

     To achieve these objectives, and for the purpose of serving the operational needs and objectives of both newspapers, the parties originally created Newspaper Agency Corporation and have now created the NAC as their joint agent under this Agreement.

     All provisions of this Agreement, separately and cumulatively, and notwithstanding any other inference that may be drawn from its wording, shall be interpreted and applied in a manner consistent with the objectives and purposes set forth in this Preamble.

     1. Effective Date — This Joint Operating Agreement was entered into initially on August 12, 1952, has been amended by an Amendment Agreement dated June 1, 1982, which had an effective date of January 1, 1983 and has been further amended by an Amendment and Restatement of Agreement dated as of January 1, 2001. All modifications thereof as set forth in this Agreement shall become effective as of July 1, 2006.

     2. The NAC — DNPC and K-T, LLC have caused the NAC to be created pursuant to the laws of the State of Utah for the purposes set forth in its Articles of Organization. The NAC shall perform various functions which the Newspaper Agency Corporation has heretofore provided to both newspapers under the 2001 JOA.

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     2.01 Ownership of the NAC — The membership interests of the NAC are owned 42% by DNPC and 58% by K-T, LLC, its two members (the “Members”). The parties hereto shall cause the operations of the NAC to continue and shall not assign, sell, transfer, mortgage, pledge or otherwise dispose of their membership interests in the NAC, nor voluntarily permit alienation of any interest therein by any means, including a sale or merger involving the owning entity, during the term of this Agreement or any renewal or extension thereof, without written approval of the other party; provided however, that such restriction shall not limit the right of the owning entity of either party to pledge, and/or otherwise grant security interests in stock or equity interests of such owning entity to secure any indebtedness now or hereafter incurred by either party nor shall such restrictions in any manner affect the enforcement of such security interests. Such restriction shall be printed on the face of any certificates evidencing the membership interests of the parties in the NAC which may heretofore or hereafter be issued or reissued, and shall be strictly enforced.

     2.02 Management Committee — The Management Committee of the NAC shall govern the NAC and shall exercise all of the usual and customary duties of managers. The Management Committee of the NAC shall consist of four (4) persons who shall be elected at each annual meeting of the Members (an annual meeting shall be held simultaneously with the execution of this Agreement, and, subsequent thereto, shall be held on the second Monday of each December commencing in 2006, at the offices of the NAC, unless the Management Committee shall determine otherwise) to serve until the next annual meeting of the Members and until their successors are elected in their stead. Two (2) members of the four-member Management Committee shall be the Chairman and the President of DNPC (unless one person shall simultaneously hold both offices of DNPC, in which case the two DNPC Management

6

Committee members shall be the Chairman of DNPC and such other senior officer of DNPC as the Chairman of DNPC shall designate) and the other two (2) members shall be the Chairman and the President of K-T, LLC (unless one person shall simultaneously hold both offices of K-T, LLC, in which case the two K-T, LLC Management Committee members shall be the Chairman of K-T, LLC and such other senior officer of K-T, LLC as the Chairman of K-T, LLC shall designate). The parties agree to vote their membership interests in the NAC to elect the Management Committee members so specified. The parties further agree that at the first annual meeting of Members following the effective date of this Amendment and Restatement and at each annual Members meeting thereafter held to elect Management Committee members, this same procedure for electing Management Committee members shall be followed.

     If the four-member Management Committee shall become deadlocked with respect to any matter to be acted upon by it, and if after negotiating reasonably and in good faith for a period of not more than five (5) business days (or such longer period as the parties may mutually agree upon) the parties are unable to resolve such deadlock, the President of the NAC shall be empowered to break such deadlock, provided such deadlock does not relate to a Reserved Matter (as hereinafter defined). If the President is called upon to break such a deadlock, he or she shall be bound to apply all the provisions of this Agreement and shall specifically be bound by its Preamble. If such deadlock relates to a Reserved Matter, such deadlock shall be resolved in the manner specified in Section 26 hereof.

     For the purposes of this Agreement, Reserved Matters shall include the exercise of any material right of either or both of the parties including but not limited to: (a) declaring or otherwise causing a distribution to either party of any of the earnings or other assets of the NAC, except as otherwise expressly provided in this Agreement; (b) approving or amending the NAC’s

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Annual Plan (as hereinafter defined); (c) changing the financial accounting or tax principles utilized by the NAC, except as otherwise required by law or governmental authority; (d) committing or causing the NAC to make aggregate capital expenditures in any fiscal year exceeding by $250,000 such amounts as are specified therefor in the capital budget section of the then applicable NAC Annual Plan; (e) except in the ordinary course of the NAC’s business, committing or causing NAC to enter into any contract or transaction requiring annual expenditures by the NAC exceeding by $250,000 or more such amounts as are specified therefor in the operations budget section of the then applicable NAC Annual Plan; (f) employing the services of, or entering into any transaction with, either party, or any affiliate thereof, directly or indirectly, except upon standard commercial terms; (g) lending or contributing to the capital of any other person any funds of the NAC, except for trade accounts receivable and/or customary employee advances; (h) unless specified or authorized in the then applicable NAC Annual Plan, encumbering any assets of the NAC, borrowing any funds, or entering into any equipment leases or purchase money financings in excess of an aggregate amount of $250,000 per fiscal year; (i) instituting any bankruptcy or insolvency proceeding or assigning any assets of the NAC for the benefit of its creditors; (j) instituting, settling, or compromising any lawsuit or claim on behalf of the NAC where the amount in controversy exceeds $250,000; and (k) any matter requiring interpretation or construction of any provision of this Agreement or the intended meaning or application thereof, or any matter having substantial financial impact upon one or both parties hereto or upon their rights to participate in matters relating to the governance of the NAC.

     The NAC Annual Plan shall consist of an (a) operating budget section and (b) a capital budget section. The NAC’s Annual Plan shall be approved annually by the Management Committee concurrently with each annual Members meeting, inclusive of the annual meeting to

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be held concurrently with the execution of this Agreement, or as soon thereafter as may be practical. If a vacancy occurs in the Management Committee, the nomination for replacement shall be made by the party hereto which nominated the person whose position is to be filled, following the same procedure outlined above in this Section 2.2. If necessary, the parties agree that they will immediately call a special meeting of the Members for the purpose of electing, in accordance with the procedure herein set forth for the election of members of the Management Committee at meetings of the Members, a Management Committee member to fill such vacancy or to remove or re-elect any or all members of the Management Committee, as they may mutually choose.

     2.03 Chairman and Vice-Chairman of NAC Management Committee — The Management Committee shall have a Chairman and a Vice-Chairman. The Chairman shall preside over and conduct meetings of the Management Committee. If the Chairman is not present at a meeting of the Management Committee, or is present and so directs, the Vice-Chairman shall preside over and conduct meetings of the Management Committee. The Vice-Chairman shall automatically succeed to all duties of the Chairman in the event of the Chairman’s unavailability or disability, until another Chairman is duly appointed.

     William Dean Singleton, who has been appointed by K-T, LLC, is the Chairman, and he personally shall be permitted to serve in such capacity so long as he desires and is ready, willing and able so to serve. DNPC shall have the right to appoint the Chairman for the four (4) year period commencing on the date on which William Dean Singleton no longer serves as Chairman. Thereafter, K-T, LLC shall have the right to appoint the Chairman for the ensuing four (4) years, whereupon the right to appoint the Chairman shall revert to DNPC and shall alternate with K-T,

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LLC for ensuing four year terms. During the time a Chairman serves, the right to appoint the Vice-Chairman shall be exercised by the party hereto that did not appoint the Chairman.

     2.04 NAC Officers — The officers of the NAC shall consist of a President, a Vice-President, a Secretary and a Treasurer. Upon the execution of this Agreement and in connection with each subsequent annual meeting of the Members of the NAC, the President of the NAC shall be selected as follows: K-T, LLC shall recommend to the Management Committee, for its approval or rejection, in its absolute discretion, K-T, LLC’s preferred candidate for President of the NAC. If such candidate is rejected by the Management Committee, K-T, LLC shall then recommend a second preferred candidate for President, which the Management Committee may again approve or reject in its absolute discretion. If either of the foregoing candidates proposed by K-T, LLC is approved by the Management Committee, such candidate shall serve as President until the next annual meeting of NAC’s Members, unless sooner removed as hereinafter provided. If both such candidates are rejected by the Management Committee, K-T, LLC shall thereupon be solely empowered to designate the person who shall then serve as President (which person shall be someone who the Management Committee has not previously declined to approve as President), which person shall then serve as President until the next annual meeting of the Members, or until sooner removed as hereinafter provided.

     Any person selected to serve as President of the NAC in accordance with the foregoing procedures shall at any time during his or her term as President be subject to removal, with or without cause, upon the affirmative vote of two or more members of the Management Committee. Upon the removal of any person as President, K-T, LLC and the Management Committee shall promptly commence to select a successor President, in accordance with the same selection procedures hereinbefore set forth.

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     The President shall report directly to the Management Committee, and upon being selected as President shall recommend to the Management Committee the persons to serve as Vice-President, Secretary and Treasurer, whose appointments and the terms and conditions thereof shall be determined by the Management Committee. No person appointed as an Officer of the NAC shall have separate connections with or loyalties to the Deseret Morning News or The Salt Lake Tribune unless otherwise mutually approved by DNPC and K-T, LLC, which approval may be withdrawn at anytime. The President shall operate the NAC fairly with equal treatment for both newspapers. Except to the extent otherwise herein provided, the powers and duties of the President, Vice-President, Secretary and Treasurer shall be as agreed to by DNPC and K-T, LLC from time to time. As approved by the NAC Management Committee, other persons may be given the working title of Vice President without such persons becoming officers of the NAC.

     2.05 Duties of President and Other Officers — The President shall conduct the normal business of the NAC pursuant to the terms of this Agreement as a stand-alone venture of the owners. Subject to legal and contractual obligations, the President shall select qualified managers, executives and personnel, and shall supervise the facilities and equipment used by the NAC, its operating systems and procedures, with respect to advertising, circulation, production, finance and personnel, and shall fulfill these duties in accordance with NAC’s applicable Annual Plan. The President and the other officers of the NAC shall at all times act independently and disinterestedly as between DNPC and K-T, LLC and in the best interest of the NAC, consistent with the Preamble to this Agreement. All compensation to the President shall be determined by the Management Committee and paid exclusively by the NAC. The President shall report

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directly to the Management Committee of the NAC and shall manage the business and affairs of the NAC under the direction and authority of its Management Committee.

     2.06 NAC Executive Committee — The Executive Committee of the NAC shall be comprised of the President of the NAC, one member of the Management Committee designated by K-T, LLC and one member of the Management Committee designated by DNPC. The Executive Committee shall have the right, under chairmanship of the President, to oversee the operations and performance of the NAC in accordance with guidelines established by the Management Committee, to take emergency action as required, and to propose to the Management Committee policies and other matters on which Management Committee action is appropriately required. The Executive Committee shall meet weekly or as often as necessary, in person or by telephone, unless otherwise directed by the NAC Management Committee. If one or more members of the Executive Committee shall be unable to attend an Executive Committee meeting, he or she may designate someone, upon notice to the other members, to attend in his or her stead.

     3. Publishing Schedules — The Deseret Morning News currently publishes morning editions Monday through Sunday between 7 p.m. and 7 a.m.. Currently, the Saturday publication carries the present tabloid LDS Church News Section, which the Deseret Morning News may elect to publish weekly on any day it may select. The Salt Lake Tribune currently publishes morning editions Monday through Sunday between 7 p.m. and 7 a.m.

     Whenever the Deseret Morning News and the Tribune are printed in the same time frame, news deadlines and printing times shall be determined in a manner fair to both newspapers, and distribution and delivery of both papers shall be accomplished by the NAC through joint use of trucks and carriers wherever practical.

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     In satisfaction of DNPC’s obligations under the 2001 JOA to purchase and/or own an additional press and/or other directly related capital equipment which may initially have been required to accommodate the entry of the Deseret Morning News into the morning field of publication, the DNPC has prior to the parties’ execution of this Amendment and Restatement of Agreement purchased, at its sole expense, one TKS Color-Top 5000 printing press and certain related press drive and central system equipment and computer software (collectively, a “TKS Press”) and has also purchased at its sole expense a 33.33 percent interest in a Newsgrip-A Conveyor System, all of which equipment concurrently with the parties’ execution of this Amendment and Restatement of Agreement, has been leased by DNPC to NAC pursuant to two separate leases between DNPC and NAC, both dated as of July 1, 2006 (the “DNPC Press and Conveyor System Leases”). Although such leases provide for the NAC to pay a fair market value rental for its use of that equipment, as required by Section 7 hereof, the parties hereby agree that for the term of such leases and any renewal thereof, there shall be a special allocation of income made and paid to K-T, LLC monthly in an amount equal to 138% of the monthly rent paid by NAC to DNPC pursuant to such leases. This special allocation of income shall be paid concurrently with the monthly distribution pursuant to Section 4 hereof.

     4. Division of Earnings and Losses Subject to the special allocation provided for at the end of Section 3 hereof, NAC shall apportion to DNPC and K-T, LLC, in percentages hereinafter set forth, the net income or the net loss of its agency operations hereunder. Each month all receipts and income collected from its newspaper operations as herein provided (except for One-sided Advertising as hereafter set forth), after said special allocation and the payment of operating expenses and other proper expenditures, and retaining such part of said net income as may reasonably be required as working capital for its near-term future operations as

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recommended by the President and approved by the Management Committee , shall be distributed to the parties hereto in percentages as follows: fifty-eight percent (58%) to K-T, LLC and forty-two percent (42%) to DNPC. Where one of the newspapers determines as a matter of editorial policy not to carry certain classifications of advertising or certain particular advertisements, all receipts and income collected from such advertising (hereinafter “One-sided Advertising”) shall be distributed to the party in whose newspaper the advertisements are run, after payment of related operating expenses as measured by the NAC’s production costs; provided, however that if advertising is in fact carried in a newspaper, the newspaper carrying such advertising shall be entitled to participate in the revenues derived therefrom regardless of whether it has a general policy of refusing the advertising in question.

     Charges to either party for Extra Editorial Pages (as defined in Section 6.05 hereof), for One-sided Advertising and/or for promotional advertising space which promotes only the Deseret Morning News or only the Tribune, or which seeks to build community goodwill or to promote charities, community groups or activities solely supported by only one of the parties, shall be based upon the NAC’s actual incremental costs of material and labor therefor, as reflected in the operating budget sections of the applicable NAC Annual Plan. Such costs shall be subject to a quarterly adjustment to reflect fluctuations in actual newsprint or other costs from the estimated newsprint costs and other estimated costs reflected in the applicable NAC Annual Plan.

     Notwithstanding the foregoing, the Management Committee of the NAC from time to time shall establish a schedule for production of each of the daily newspapers which imposes reasonable duties on each of the parties to cooperate in meeting page flow, press starts and other production deadlines. If for any reason DNPC or K-T, LLC fails to adhere to said schedule

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within designated tolerances, such failing party may be assessed a late charge according to a schedule of production costs computed using the NAC’s accounting methods. Such charge shall be subject to approval by the NAC Management Committee.

     5. Limitations on Activities — Neither party shall engage in any activity which, in the opinion of counsel satisfactory to both of them, would jeopardize the exemption of this Agreement and the parties’ joint operating arrangement under the Newspaper Preservation Act.

     Neither party shall have the right to utilize the services or facilities of the NAC for any other newspaper publication published by either party without the prior written consent of the other party, and without the entire cost of such services and/or facilities being allocated to the party utilizing them.

     Except as provided in this Agreement, neither party hereto shall publish any newspaper in the State of Utah so long as this Agreement shall remain in force, except as a given area shall be designated in writing by one party to this Agreement as being outside the then existing primary and secondary market areas of either newspaper (i.e., the Newspaper Designated Market and Retail Trading Zone, as defined by the Audit Bureau of Circulation) and the other party does not object in writing within sixty (60) days from the receipt of such designation. No such objection shall be made unreasonably, and such objections must be based on the following criteria: the NAC’s market penetration in the designated area, such area’s importance to the NAC’s advertisers, and all other criteria then relevant to a proper determination that such an objection constitutes a necessary and ancillary restraint to this Agreement under the antitrust laws. The restrictions hereinbefore set forth shall not, however, apply (a) to the Park Record or any other newspaper now published in Summit County, Utah by the Park Record, its owner, Utah Media, Inc., a Delaware corporation, or its successors in interest (“UMI”), or (b) any newspaper or other

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publication now or hereafter published by any entity, of which less than fifty percent (50%) of the stock or other equity is owned by William Dean Singleton, his family and/or trusts for their benefit.

     DNPC may, on its own, use the NAC services and facilities to publish for distribution outside the State of Utah (or elsewhere outside the primary market area when designated without objection pursuant to this paragraph) a national or international edition or section of the Deseret Morning News. This edition or section may contain advertising at rates and with guidelines and advertising and editorial ratios as may be determined by DNPC’s management. DNPC shall pay to the NAC the actual amount of increased out-of-pocket costs actually incurred for this special edition and shall receive the revenues for advertising published in said national or international edition for distribution outside the state of Utah.

     6. General Relations and Duties of the NAC — The sole purpose and function of the NAC shall be to act as agent of the parties hereto in the printing, advertising, solicitation and distribution functions of their respective newspapers, and doing such other things as are herein specified, the cost of which shall be paid out of the moneys collected by the NAC as herein provided. The NAC shall be entitled, as a commission, to a fee in an amount equal to 3.5% of the net income of its agency operations under this Agreement, in keeping with requirements of the Internal Revenue Service, which amount shall be distributed to the parties from time to time based upon their respective percentage of earnings allocation when the commission was charged.

     6.01 Management — Management and control of the business of the NAC shall be and remain in its Management Committee. Except as specifically provided in this Agreement, neither the officers, directors or employees of either of the parties hereto shall undertake or

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assume the direction or control of any of the executive officers or employees of the NAC in the performance of their duties and obligations hereunder.

     6.02 NAC as Agent — Except as may be expressly otherwise herein provided, all contracts made by the NAC shall be made in the capacity of agent of the parties hereto and its activities and powers shall be confined entirely to such agency. Except as may otherwise expressly herein, no provision contained herein or in the Articles of Organization or Operating Agreement of the NAC shall be construed as permitting it to act other than as agent of the parties hereto, as herein provided, during the term of this Agreement and any renewal or extension thereof.

     6.03 NAC Duties — The parties hereto shall, except insofar as the NAC itself shall secure the same and/or otherwise acquire the ownership thereof, make available or cause to be made available, for the use of the NAC, as their agent, all records, office equipment and other facilities necessary to enable the NAC to carry into effect the purposes, objects, terms and conditions of this agreement. The NAC shall, as agent, except as the parties may otherwise expressly provide herein, (a) continue to perform all of the functions and provide all of the services the Newspaper Agency Corporation heretofore performed and provided under 2001 JOA; (b) implement NAC’s Annual Plan, (c) solicit, distribute and promote the business of the papers, and do all billing for advertising, circulation and other charges on behalf of the parties hereto; (d) receive and collect all receipts and income from the publication of the newspapers of the parties hereto; (e) pay all operating expenses incident to the printing, of the sale of advertising and subscriptions for, of the promotion and distribution of said newspapers, excepting the news and editorial departments thereof and other functions performed separately by the parties (e.g., internal accounting, etc.), and excluding salaries of the executives of the

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parties hereto; (f) prepare balance sheets and statements of income, cash flow and owners’ equity on a monthly basis. Such statements shall be prepared on a consistent basis and in accordance with generally accepted accounting principles; (g) keep complete books of account and records of operations and costs, all of which books and records shall be accessible at all times to the parties hereto; (h) prepare and deliver all necessary reports to governmental agencies; (i) promote the advertising in and circulation of both newspapers consistent with provisions of the Preamble to this Agreement; and (j) integrate the operations as much as is prudent and businesslike in order to effect all practical economies.

     6.04 Subscription Rates/Advertising — The NAC shall have the right to set and establish the respective advertising and subscription rates for the Deseret Morning News and the Tribune from time to time; provided, however, that circulation rates shall be established in such a manner so as not to constitute a detriment to either of the newspapers with respect to the other or to provide a benefit for either of the newspapers with respect to the other. Whenever the advertising linage of the Deseret Morning News acceptable to it is 85% or less than that of the Tribune, the NAC shall restructure the rate card within any legal and economic restraints to again make buying the Deseret Morning News space along with that of the Tribune as attractive as possible. The classified advertising section shall be identical in each newspaper, except where one of the newspapers refuses to accept certain classifications of advertising or certain particular advertisements, as provided herein (i.e., One-sided Advertising), or except when the advertisers elect to advertise in only one newspaper. Unless the parties agree otherwise, each newspaper’s classified advertising section shall carry the separate folio of the newspaper in which it appears.

     6.05 Newshole Allocations — During the term of this agreement, the NAC shall establish the size of each day’s edition of the newspapers, and allot to the Deseret Morning

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News the same percentage ratio newshole as the Tribune, based on the amount of run of press (“ROP”) paid advertising space appearing in each newspaper. The average weekly ratio of newshole to advertising space shall be determined annually in the NAC’s Annual Plan, provided that in no case shall the amount of space allotted for editorial matter in any single edition be less than ninety-three (93) columns (fifteen and one-half pages), unless otherwise approved by the Management Committee. If either newspaper requires more editorial space than the amount allotted by NAC in any given week (“Extra Editorial Pages”), the cost of such extra pages beyond the newshole established by the NAC shall be charged to the party requiring the extra pages in the manner described in Section 4 hereof.

     6.06 Working Capital — The parties hereto shall from time to time, upon request of the President and upon the approval of the Management Committee, provide additional working capital to the NAC in the ratio of their respective percentages of earnings and losses (i.e., 58% — 42%) as set forth in Section 4 hereof, as such amounts may be required to enable the NAC to carry on and perform its duties hereunder. If either party shall fail to provide its required share of additional working capital when due, the other party may elect to provide such share, as an advance on the defaulting party’s behalf, which advance shall bear interest at the prime lending rate charged by the Bank of New York until repaid, and which advance shall be repaid in full before the party failing to provide its required share of working capital shall be entitled to receive further distributions of profits of the NAC pursuant to Section 4 hereof.

     6.07 Employees — The NAC shall contract with, employ and pay all employees necessary to its operation as provided herein, and shall make contracts in connection with such employment of labor and with independent contractors for the furnishing of labor as may be required; provided, however, that the NAC shall have no role or involvement whatsoever with

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employment in connection with the operations of the editorial and news departments of the parties hereto.

     6.08 Audits — An annual audit of the business of the NAC shall be made by an independent certified public accountant or firm of certified public accountants selected by the Management Committee, and copies of the reports issued with respect to such audits shall be furnished to each of the parties hereto.

     6.09 Agency Status — Except as may otherwise expressly be provided herein, the NAC shall be only an agent and shall act only in an agency capacity for the parties hereto in its operations hereunder, and there is not and shall not be any partnership or joint adventure between the parties hereto or between either of the parties hereto and the NAC

     6.10 Accounts to be Paid — Except as herein otherwise provided, the NAC shall pay only such accounts as shall have been incurred by it as such agent.

     6.11 Libel Actions — Any expense arising out of claims for libel or alleged libel, and any judgment (including attorney fees) in connection therewith, shall be borne and paid by the party hereto in whose newspaper the libel or alleged libel is published.

     6.12 Newsprint — The parties hereto will use their buying power relationships to enable the NAC to purchase newsprint at the lowest possible price, without markup. In the event a newsprint shortage necessitates reduction in number of pages of the Tribune and the Deseret Morning News, they shall be reduced equally in number.

     6.13 Trademarks, etc. — Neither party hereto shall in any manner represent or claim that it has any ownership interest in any trademarks, trade names, service marks and copyrights held by the other party and each party acknowledges that any use by it or by the NAC hereunder

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of any trademarks, trade names, service marks and copyrights held by the other party shall not create in its or in the NAC’s favor any right, title or interest in or to the same.

     7. Property Furnished to the NAC — As of July 1, 2006, NAC, as lessee, will enter into leases with Salt Lake Newspaper Production Facilities, LLC (which is owned by MediaNews Group and DNPC), as lessor, for new production facilities in West Valley City (excluding certain equipment which is owned by the parties as tenants in common and which will not be subject to said leases and excluding the equipment which will be the subject of the DNPC Press and Conveyor System Leases described in the last paragraph of Section 3 hereof) and, as lessee, will enter into the DNPC Press and Conveyor System Leases with DNPC, as lessor. NAC may also now or in the future enter into other leases with one or both of the parties or with third parties for additional real property, equipment and other property, and NAC may from time to time purchase or otherwise acquire additional real property, equipment and other property. In addition to such real property, equipment and other property that NAC may lease, purchase or otherwise acquire relative to the carrying out of its operations, the parties hereto (either as tenants in common or as separate owners) shall furnish (58% by K-T, LLC and 42% by DNPC) and place at the disposal of the NAC, for its exclusive use, such other real property, equipment, and other property as shall be required by NAC, subject to the following provisions:

     (a) All of the same shall be used, kept in repair and, as approved by the NAC’s Management Committee, added to, maintained and replaced by the parties when necessary.

     (b) All of the same, and all additions to and replacements thereto, shall, unless and until the parties shall mutually contribute their ownership interests from time to time in such equipment to the NAC, continue to be owned by the

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parties hereto (either as tenants in common or as separate owners) in accordance with their respective interests and appropriate book records thereof shall be kept by the NAC.

     (c) All of the same, including additions thereto, may be sold or exchanged by the NAC; provided, however, that no part thereof shall be sold or exchanged except with approval of the NAC’s Management Committee and after full compliance with the terms and provisions of any and all contracts and obligations of the parties hereto applicable thereto.

     (d) In the event of any authorized sale thereof by the NAC, the NAC shall pay the proceeds of any such sale to the parties hereto in accordance with their respective ownership interests therein.

     (e) Title thereto, except as the parties may have contributed to the NAC their ownership interests therein, shall be in the parties hereto, as provided herein, and shall at no time be in the NAC.

     (f) shall, out of the funds received by it as the parties’ agent, pay for all necessary repairs thereof, all taxes levied and assessed thereon, fire and other customary insurance thereon and in connection with the use thereof, to the same extent and in the same manner it would pay for such matters in connection with similar items of property which the NAC may itself own directly.

     8. Independent Editorial and News Departments and Advertising Policies — Each of the parties hereto retains unto itself complete and exclusive control of its news and editorial departments and policies, together with its editorial contracts, conduct and contents, and the selection of its editors and news and editorial department employees. There shall be no

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merger, combination or amalgamation of editorial or reportorial staffs, and editorial policies shall be independently determined. All expenses of the news and editorial department of each of the parties hereto, including wire and photo services, salaries, compensation, rentals to or for correspondents and bureaus, features and feature services, graphics, internet content, office equipment and supplies, and all other expenses directly attributable to their respective news and editorial departments shall be paid by the respective parties hereto and not by the NAC.

     Both parties shall have unlimited discretion to contract with a third party to exercise the newspaper’s independent editorial and newsroom rights of expression, but all other rights under this Agreement shall be personal and non-delegable, except as otherwise expressly provided in Section 21 hereof.

     Each party hereto retains unto itself complete and exclusive control of its advertising acceptance policies and the content of the advertising to appear in the respective newspaper edited by it. The NAC shall use its best efforts to transfer unacceptable advertising from a feature section to a main section of the newspaper that edits the section and elects to publish such advertising, so long as the advertiser agrees and it is mechanically feasible.

     Any claims of third parties, cost or expense arising from excluding advertising from one of the two newspapers, shall be borne by the party whose policies exclude the same. Any such claims, cost or expense arising from the inclusion of the advertising in one newspaper, when such advertising has been excluded from the other newspaper due to its advertising policies, shall be borne by the publishing newspaper.

     9. Circulation Promotions — To implement provisions of the Preamble to this Agreement, the NAC will devote sufficient funds and efforts to expand marketing, promotion and advertising for the purpose of increasing circulation of both newspapers. Expenditures for

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these efforts, including geographic expansion, shall be weighted in favor of the newspaper with less overall circulation.

     The NAC will support expanded geographic distribution for the Deseret Morning News (and, if desired by K-T, LLC, for the Tribune) into other key markets outside the primary and secondary market areas (as hereinbefore defined) currently served by either newspaper, whenever practical; provided, however, that if such expansion is undertaken for only one of the newspapers at its request and such expansion occasions any incremental cost to the NAC, the party requesting such expansion shall be charged for such cost and provided further such party shall be entitled to receive all of the circulation revenue received by the NAC from such expanded circulation.

     All advertising and promotion of both newspapers shall be done by the NAC, except that DNPC shall be free to spend whatever it wishes in additional sales promotion of the Deseret Morning News through the NAC or independently, provided such expenditures by DNPC shall be coordinated with the NAC’s efforts.

     10. Ownership of K-T, LLC — The parties confirm that this Agreement creates a special relationship between them that must be honored and preserved. It is therefore agreed that the present ownership of K-T, LLC (i.e., one hundred percent owned by MediaNews Group, Inc.) shall not be changed without written consent of DNPC, which shall not be unreasonably withheld; provided, however, that DNPC shall have the unrestricted discretionary right to withhold its consent if any sale, transfer or conveyance in one or more transactions would result in more than 49% of the ownership of K-T, LLC being held by any entity or entities other than MNG or if any such owner or owners of minority interest in K-T, LLC, individually or collectively, would have the right to manage or participate in management of K-T, LLC or

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compel it to take or forbear any action with respect to this Agreement or management of the NAC.

     11. Term and Renewals — This Agreement shall continue until and through the thirty-first day of December, 2020 unless sooner terminated as provided in Section 12 hereof. This Agreement shall automatically renew for succeeding renewal periods of five (5) years each, unless either party shall notify the other in writing at least two (2) years prior to the end of the then current term that it elects to terminate the Agreement at the end of the then current term; provided further, anything to the contrary in this paragraph notwithstanding, DNPC shall have the option to extend the initial term of this Agreement for successive additional terms of ten (10) years by notifying K-T, LLC of its election to do so at least two (2) years prior to the end of the current term or of any extended term.

     12. Optional Termination — Either party hereto shall have the option to terminate this Agreement at any time upon the happening of any one or more of the following events:

     (a) Performance of this Agreement by either or both parties involves a violation of law or of governmental order or decree; or

     (b) Change or modification is made in the scope or applicability of the exemption available under the Newspaper Preservation Act which prevents the performance of this Agreement according to its terms; or

     (c) As a result of any changes in the Constitution of any state or the Constitution of the United States of America or of legislative or administrative action (whether state or federal) or by final decree, judgment or order of any court or administrative body (whether state or federal) entered after the contest thereof by either or both parties in good faith, this Agreement

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shall have become void or unenforceable or impossible of performance in accordance with the intent and purposes of the parties as expressed in this Agreement; or

     (d) Because of the bankruptcy or insolvency of a party, there has been or is likely to be an involuntary alienation of the membership interests of the NAC owned by such party.

           To exercise such option, the party seeking to terminate this Agreement shall give written notice to the other party within fifteen (15) days following the occurrence of the event upon which termination is to be made describing such event, except that no such termination shall be effective until the expiration of twelve (12) months after giving such written notice wherever it is legally possible, unless such delay in termination would substantially prejudice either or both parties.

     13. Rights of Parties on Termination — On termination of this Agreement by expiration or otherwise, the parties hereto shall meet and endeavor to work out a just and equitable plan for discontinuing the operation of their newspapers by the NAC, and each shall assume the full operation of its respective newspaper from the NAC at the earliest legally mandated practicable date, subject to the provisions of the preceding sentence of this Agreement. It is understood that until the physical properties, real and personal, owned by the parties hereto and made available to NAC for the printing and distribution of their newspapers, are properly segregated or divided so that each of the parties hereto can print and circulate its paper with its own equipment (and in no event for a period of availability, if desired by either party, less than three years from the date of termination), such equipment and real property so owned by them in common and which may be necessary for the continued printing and circulation of their two newspapers shall continue to be available to both parties, in an equitable manner, to the extent legally permissible, to the end that there be no break in the continued publication and circulation

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of their respective newspapers. Either party may, by mutual agreement, acquire the plant and equipment interests of the other party, but neither party shall be compelled to purchase or sell such asset interests to the other except as provided in a mutually agreed plan of distribution. Upon termination of this Agreement, both parties shall be given full access to all circulation, subscriber and single copy distribution lists, advertising account records, and market research data relating to both newspapers. The provisions of this paragraph do not apply to property that is leased by the NAC from either K-T, LLC or DNPC or that is leased by the NAC from Salt Lake Newspaper Production Facilities, LLC, which leases have their own termination provisions.

     The NAC shall be dissolved as soon as practicable, and the cost and expense thereof paid from such funds as the NAC may have on hand, and, if insufficient, the deficiency shall be funded by the parties hereto in the same proportion to which they are entitled to participate in the earnings of the NAC at the time of dissolution. Accounts or obligations incurred by the NAC prior to or in connection with such dissolution and any of its then outstanding commitments shall be paid or provided for out of funds it may have on hand and, if such funds are insufficient, shall be paid or provided for by the parties in the same proportion to which they are entitled to participate in the earnings of the NAC at the time of dissolution. Property other than cash and accounts receivable which may be in the custody of the NAC, shall be delivered to the parties herein in accordance with their respective interests therein. Any remaining cash on hand with the NAC that is not needed for the payment of accounts or obligations, as aforesaid, or required to be set aside for liquidation of commitments, together with notes and accounts receivable, shall be delivered to the parties hereto in such proportion as they may be entitled to participate in the earnings of the NAC at the time of dissolution.

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     If, upon termination of this Agreement, the parties are unable to agree upon a distribution plan and its implementation, either party may petition for a court-appointed receiver to effect a dissolution of the NAC and distribution of its assets pursuant to Rule 66(h) of the Utah Rules of Civil Procedure. If a receiver is appointed, the parties hereto will stipulate that the provisions of this Agreement will be implemented by the receiver to the full extent permitted by law.

     14. Notices — All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered personally, by telecopier or sent by certified mail, return receipt requested, postage prepaid, or by a recognized air courier service as follows:

     If to DNPC to:

Deseret News Publishing Company
30 East First South
Salt Lake City, Utah 84111
Attention: Ellis R. Ivory, Chairman

     with a copy to

Kirton & McConkie, P.C.
Eagle Gate Tower
60 East South Temple Street, Suite 1800
Salt Lake City, Utah 84111
Attention: Robert W. Edwards

     If to K-T, LLC to:

Kearns-Tribune, LLC
c/o MediaNews Group, Inc.
1560 Broadway, Suite 2100
Denver, CO 80202
Attention: Joseph J. Lodovic, IV, President

     with a copy to

Hughes Hubbard & Reed LLP
1775 I Street, N.W., Suite 600
Washington, DC 20006
Attention: Howell E. Begle, Jr., Esq.

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or to such other address or addresses as shall be designated in writing. All notices shall be effective when received.

     15. Confidentiality — Except as required by law, legal process, government regulators, or as reasonably necessary for performance of their obligations or enforcement of their rights under this Agreement, without the prior written consent of the other, the parties hereto will treat and hold as confidential all confidential information disclosed to or received by them relating to the business of the NAC, including all intellectual property rights, in each case excluding information that (a) at the time of disclosure or receipt is in the public domain or thereafter enters the public domain without any act or omission of receiving party, (b) was in possession of the receiving party before its disclosure hereunder, or (c) is obtained by the receiving party from a third party who does not thereby breach an obligation of confidence to either party to this Agreement and who discloses it in good faith.

     16. Definition of Parties — Any reference herein to Kearns-Tribune, LLC (K-T, LLC), to MediaNews Group, Inc. (MNG), or to either or both of them as a “party” or as “parties” to this Agreement, as such references relate to any covenants, performances and prohibitions set forth in this Agreement, shall include all entities and enterprises in which William Dean Singleton, members of his family and/or trusts for their benefit collectively own fifty percent (50%) or more, directly or indirectly of the ownership, and all such other entities and enterprises over which he otherwise is capable of exercising management control. Any reference herein to Deseret News Publishing Company as a party to this Agreement, as such references relate to any covenants, performances and prohibitions set forth in this Agreement, shall include all entities and enterprises in which Deseret Management Corporation or any other entity affiliated with The Church of Jesus Christ of Latter-day Saints owns fifty percent (50%) or more, directly or

29

indirectly of the ownership and all such other entities and enterprises over which Deseret Management Corporation or any other entity affiliated with The Church of Jesus Christ of Latter—day Saints otherwise is capable of exercising management control.

     17. Counterparts — This Agreement may be executed in two or more counterparts by the parties hereto, each of which when so executed will be an original, but all of which together will constitute one and the same instrument.

     18. Governing Law — This Agreement shall be governed by and construed in accordance with the laws of the State of Utah as applied to transactions taking place wholly within Utah between Utah residents.

     19. No Third Party Beneficiary — This Agreement is made solely for the benefit of the parties hereto and their lawful successors and assigns. No other person shall have any rights, interest, or claims hereunder or otherwise be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise.

     20. Take Action — Each of the parties hereto agrees to take all corporate or other action necessary to carry out and effectuate the intent, purposes and provisions of this Agreement and to cooperate with the other party in every reasonable way that will promote successful and lawful operation of this Agreement for both parties.

     21. Successors and Assigns — Because of the special and fiduciary relationship created hereby, neither this Agreement nor any of the rights or obligations of either party thereto shall be assignable or delegable by either party without the written consent of the other. Any authorized assignment shall be binding upon and inure to the benefit of the respective successors and assigns of the parties hereto.

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     22. Equitable Remedies — Because of the special relationship perpetuated by this Agreement and because the parties hereto stipulate that an award of damages for breach of this Agreement will not provide an adequate remedy for such breach, the parties shall be entitled to specific performance of the terms of this Agreement and other appropriate equitable remedies.

     23. Severability — If any provision of this Agreement shall be held or deemed to be or shall, in fact, be illegal, invalid, non-binding, inoperative or unenforceable, the same shall not affect any other provision or provisions herein contained or render the same illegal, invalid, non-binding, inoperative, or unenforceable to any extent whatever.

     24. NAC Binding Approval — The parties shall cause the NAC to approve and accept in writing all of the terms hereof applying to it, with duplicate original executed copies thereof delivered to each of the parties hereto.

     25. Department of Justice Filing — A copy of this 2006 Amendment and Restatement Agreement, together with a copy of the 1952 Agreement, the 1982 Amendment and the 2001 Amendment and Restatement of Agreement, shall be filed with the United States Department of Justice immediately following its execution by the parties hereto.

     26. Arbitration — If the parties are deadlocked with respect to a Reserved Matter and if the parties’ dispute with respect to such Reserved Matter is not resolved by negotiation within ten (10) business days following written notice of the dispute delivered by either party to the other, either party shall have the right to refer the dispute to arbitration by giving notice to the other, which notice shall identify the dispute. During the first seven (7) days after such notice demanding arbitration the parties shall seek to nominate a mutually agreed upon arbitrator. If such an arbitrator is selected and engaged, he or she shall serve in accordance with these provisions. If within the said seven day period no mutually agreed arbitrator is selected and

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engaged, then the party requesting arbitration shall provide a copy of the notice and request for arbitration to the person serving at such time as President of the Newspaper Association of America (“NAA”) or, if such person is interested in the dispute or is not independent of each of the parties, the most recent past president of the NAA who is not interested in the dispute and who is independent of each of the parties. The NAA President or past president receiving such notice (“Facilitator”) shall, within fifteen (15) days after receipt of the notice, appoint either himself or herself, or such other person qualified as stipulated herein, to serve as arbitrator of the dispute (“Arbitrator”). The arbitration shall be conducted in accordance with the Rules of the American Arbitration Association or such other rules as the Arbitrator in his or her sole discretion shall select (in either case, the “Rules”). The procedural laws of the Federal Arbitration Act shall apply to the arbitration to the extent not inconsistent with the Rules. The arbitrator appointed hereunder shall not be interested in the dispute, shall be independent of each of the parties, and shall be a professional with at least ten (10) years experience in the newspaper publishing industry at an executive level or otherwise a person of recognized competence or expertise in the field of newspaper publishing.

     The venue of the arbitration shall be in Salt Lake City, Utah. In arriving at a decision, the Arbitrator shall consider the pertinent fact and circumstances. Parties shall have the right to present documentary evidence and witnesses and to cross-examine witnesses. The Arbitrator shall issue his or her findings and conclusions in writing. The decision of the Arbitrator shall be final and binding upon the parties, and no party shall seek recourse to a law court or other authorities to appeal for revisions of such decision. Each party shall be responsible for payment of its own expenses and the parties shall equally share the fees and expenses of the Arbitrator. On request of any party, a transcript of the hearing shall be prepared and made available to the

32

parties. Judgment on the decision of the Arbitrator may be entered in any court having jurisdiction thereof. Nothing in the Agreement shall preclude a party hereto from seeking equitable or other relief from a court of competent jurisdiction when such relief is unavailable pursuant to the Rules. The parties agree that any arbitration relating to a dispute hereunder shall be conducted and concluded as privately and expeditiously as possible, and the parties shall use their best efforts to that end.

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     IN WITNESS WHEREOF, the parties hereto have caused these presents to be duly executed at Salt Lake City, Utah, the day and year first above written.

ATTEST:		DESERET NEWS PUBLISHING COMPANY
By:	\s\ Michael B. Todd	By:	\s\ Jim M. Wall
	, Secretary		Jim M. Wall, President

ATTEST:		KEARNS-TRIBUNE, LLC
By:	\s\ Patricia Robinson	By:	\s\ Joseph J. Lodovic, IV
	Patricia Robinson, Secretary		Joseph J. Lodovic, IV, President

     Newspaper Agency Company, LLC hereby approves and accepts the foregoing Agreement and agrees to be bound by terms and provisions thereof applicable to it.

ATTEST:		NEWSPAPER AGENCY COMPANY, LLC
By:	\s\ Patricia Robinson	By:	\s\ William Dean Singleton
	Patricia Robinson, Secretary		William Dean Singleton, Chairman

EX-10.16

Exhibit 10.16 EXECUTION VERSION

Limited Liability

Company Operating Agreement

of

Newspaper Agency Company, LLC

July 1, 2006

TABLE OF CONTENTS

ARTICLE I			1
Definitions			1
ARTICLE II			10
The Limited Liability Company			10
	2.1	Formation	10
	2.2	Name	10
	2.3	Business Purpose	10
	2.4	Registered Agent	11
	2.5	Term	11
	2.6	Principal Place of Business	11
	2.7	Title to Company Property	11
	2.8	The Members	11
	2.9	Fiscal Year	11
	2.10	Representations and Warranties of the Parties	12
	2.11	Survival of Representations and Warranties	13
ARTICLE III			13
Capital Structure and Contributions			13
	3.1	Capital Contributions	13
	3.2	Failure to Make Capital Contributions	14
	3.3	No Right to Return of Capital Contributions	14
	3.4	Loans by Third Parties	15
ARTICLE IV			15
Capital Accounts; Allocation of Profits and Losses			15
	4.1	Capital Accounts	15
	4.2	Book Allocation	16
	4.3	Tax Allocations	20
ARTICLE V			22
Distributions			22
	5.1	In General	22
	5.2	Periodic Distributions	22
ARTICLE VI			22
Accounting and Reports			22
	6.1	Books and Records	22
	6.2	Reports to Members	23
	6.3	Tax Matters Member/Annual Tax Returns	24
	6.4	Actions in Event of Audit	27
	6.5	Tax Election	27
ARTICLE VII			28
Actions by Members			28
	7.1	Meetings/Actions by Members	28
	7.2	Certain Matters Requiring Approval of the Members	28
	7.3	Action by Consent	29
	7.4	Limitation on Rights of Defaulting Member	30

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ARTICLE VIII			30
Management Committee			30
	8.1	The Management Committee	30
	8.2	Limitation of Rights of Defaulting Member	30
ARTICLE IX			31
Transfer of Company Interests; Additional and Substitute Members			31
	9.1	Prohibited Transfers	31
	9.2	Permitted Transfers by Members	31
	9.3	Substitute Member	33
	9.4	Involuntary Transfers	33
ARTICLE X			37
Dissolution and Liquidation			37
	10.1	Dissolution	37
	10.2	Closing of Affairs	37
	10.3	Orderly Liquidation	39
	10.4	Deficit Upon Liquidation	39
ARTICLE XI			39
Amendments to Agreement			39
ARTICLE XII			40
Indemnification			40
	12.1	Remedies for Breach	40
	12.2	Limitation of Liability	40
	12.3	Indemnification by Members for Breach of Representations or Warranties	40
	12.4	Indemnification by Company	43
ARTICLE XIII			47
General Provisions			47
	13.1	Arbitration	47
	13.2	Notices	47
	13.3	Confidentiality	48
	13.4	Public Announcements	50
	13.5	Entire Agreement, Amendments, etc.	50
	13.6	Construction Principles	50
	13.7	Counterparts	51
	13.8	Severability	51
	13.9	Expenses	51
	13.10	Governing Law	51
	13.11	Binding Effect	52
	13.12	Additional Documents and Acts	52
	13.13	Third Party Beneficiaries	52
	13.14	Limited Liability Company	52

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EXHIBITS

Exhibit 1 2006 Amended and Restated Salt Lake JOA

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LIMITED LIABILITY COMPANY OPERATING AGREEMENT

OF

NEWSPAPER AGENCY COMPANY, LLC

     This Liability Company Operating Agreement is made and entered into as of the 1st day of July, 2006, between Kearns-Tribune, LLC., a Utah limited liability company, and Deseret News Publishing Company, a Utah corporation (“DNPC”). K-T, LLC and DNPC shall hereafter be known as and referred to as the “Members” and individually as a “Member.”

ARTICLE I
Definitions

     “Absolute Majority Vote of the Management Committee” means the affirmative vote of a majority of all of the appointed members of the Management Committee irrespective of whether all of the appointed members of the Management Committee are present at a duly constituted meeting of the Management Committee.

     “Act” means the Utah Limited Liability Company Act, as in effect from time to time.

     “Adjusted Capital Account Deficit” means, with respect to any Member, the deficit balance, if any, in such Member’s Capital Account as of the end of the relevant Fiscal Year, after giving effect to the following adjustments:

               (i) such Capital Account shall be deemed to be increased by any amounts that such Member is deemed to be obligated to restore pursuant to (A) the penultimate sentence of Regulations Section 1.704-2(g)(1), or (B) the penultimate sentence of Regulations Section 1.704-2(i)(5); and,

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               (ii) such Capital Account shall be deemed to be decreased by the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

     “Affiliate” means any person controlled by, controlling, or under common control with the entity in question.

     “Agreement” means this document.

     “Bankruptcy Event” means with respect to any Member (i) the application for, or the consent to, the appointment of a conservator, receiver, trustee, liquidator or the like for itself or its property; (ii) the admission in writing of its inability to pay its debts as they mature; (iii) the making of a general assignment for the benefit of its creditors; (iv) its being adjudicated as bankrupt or insolvent; (v) its filing a voluntary petition in bankruptcy or a petition or answer seeking reorganization or an arrangement with creditors or to take advantage of any insolvency law, or an answer admitting the material allegations of a petition filed against it in any bankruptcy, reorganization, or insolvency proceedings, or corporate action taken by it for the purpose of effecting any of the foregoing or (vi) an order, judgment, or decree being entered against it by a court or governmental agency of competent jurisdiction, approving a petition seeking reorganization of it or appointing a conservator, receiver, trustee, liquidator, or the like for it or for all or a substantial part of its assets, and such order, judgment, or decree continuing unstayed or in effect for any period of thirty (30) consecutive days, or an involuntary petition being filed against it in bankruptcy or seeking reorganization under the Bankruptcy Act (and the same not having been dismissed within sixty (60) days).

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     “Book Value” means, with respect to any asset of the Company, the adjusted basis of such asset as of the relevant date for federal income tax purposes, except as follows:

               (i) the initial Book Value of any asset contributed by a Member to the Company shall be the fair market value of such asset as determined by all of the Members. The determination by the Members of the fair market value of those assets contributed to the Company in conjunction with the formation of the Company is set forth in Exhibit “A.”

               (ii) the Book Value of all Company assets (including intangible assets such as goodwill) shall be adjusted to equal their respective fair market values as of the following times:

          (A) the contribution of money or other property (other than a de minimis amount) to the Company by a new or existing Member as consideration for an interest in the Company;

          (B) the distribution by the Company to a Member of more than a de minimis amount of money or Company property as consideration for an Interest in the Company; and,

          (C) the liquidation of the Company within the meaning of Regulation Section 1.704-1 (b)(2)(ii)(g);

               (iii) The Book Value of any property distributed to any Member shall be adjusted to equal the gross fair market value (taking into account Code Section 7701(g)) of such asset on the date of distribution as determined by the distributee and all of the Members;

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               (iv) the Book Value of the Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulation Section 1.704-1 (b)(2)(iv)(m), provided however, that Book Value shall not be adjusted pursuant to this subsection (iv) to the extent all of the Members determine that an adjustment pursuant to subsection (ii) above is necessary or appropriate in connection with a transaction that would otherwise result in an adjustment pursuant to this subsection (iv); and,

               (v) if the Book Value of an asset has been determined or adjusted pursuant to subsections (ii), (iii) or (iv) above, any such adjustment shall be reflected in the Profits and/or Losses of the Company (for book purposes but not for tax purposes) and allocated among the Members in accordance with Section 4.2, and such Book Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses and other items allocated pursuant to Section 4.2.

     The foregoing definition of Book Value is intended to comply with the provisions of Regulation Section 1.704-1 (b)(2)(iv) and shall be interpreted and applied consistently therewith.

     “Business Day” means any day (other than a day which is a Saturday, Sunday or legal holiday in the State of Utah).

     “Business Plan” means the NAC Annual Plan as defined in Section 2.02 of the Salt Lake JOA.

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     “Business Purpose” shall have the meaning ascribed in Section 2.3.

     “Capital Account” means, for each Member, the capital account maintained by the Company for such Member as described in Section 4.1.

     “Capital Contribution” means the amount of money and the agreed fair market value of other property (net of any liabilities secured by such property that the Company is considered to assume or take subject to Code Section 752) contributed by a Member to the Company pursuant to Article III hereof.

     “Code” means the Internal Revenue Code of 1986, as amended from time to time or any successor statute. A reference to the Code shall be deemed to include any mandatory or successor provisions thereto.

     “Company” means the Newspaper Agency Company, LLC, a Utah limited liability company, or its successor in interest, as identified in Section 2.3.

     “Company Minimum Gain” means the aggregate amount of gain (of whatever character), determined for each Nonrecourse Liability of the Company, that would be realized by the Company if it disposed of the Company property subject to such liability in a taxable transaction in full satisfaction thereof (and for no other consideration) and by aggregating the amounts so computed, determined in accordance with Regulation Sections 1.704-2(d) and (k).

     “Defaulting Member” shall have the meaning ascribed in Section 3.4.

     “Depreciation” means, for each Fiscal Year or part thereof, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such Fiscal Year or part thereof, except that if the Book Value of an asset differs from its adjusted basis for federal

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income tax purposes, the depreciation, amortization or other cost recovery deduction for such Fiscal Year or part thereof shall be determined in accordance with Treasury Regulations Section 1.704-3(d).

     “Distribution Plan” shall have the meaning ascribed to it in Section 10.2(a) hereof.

     “Effective Date” shall mean the date of this Agreement.

     “ERISA” means the Employment Retirement Income Security Act of 1974, as amended.

     “Excess Losses” shall have the meaning ascribed to it in Section 4.2(c)(i) hereof.

     “Excluded Assets” shall have the meaning ascribed to it in Section 3.10 hereof.

     “Fiscal Year” means the fiscal year of the Company as defined in Section 2.10 hereof.

     “GAAP” means generally accepted accounting principles, as in effect from time to time.

     “Interest” means, with respect to any Member at any time, such Member’s entire beneficial ownership interest in the Company at such time, including such Member’s Capital Account, voting rights (if any), and right to share in Profits and Losses, all items of income, gain, loss, deduction and credit, distributions and all other benefits of the Company as specified in this Agreement, together with such Member’s obligations to comply with all of the terms of this Agreement. With respect to any person other than a Member, “Interest” means the entirety of such person’s rights and obligations with respect to the Company.

     “Salt Lake JOA” shall have the meaning ascribed in Section 2.3.

     “K-T, LLC” means Kearns-Tribune, LLC, a Utah limited liability company.

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     “Management Committee” shall have the meaning ascribed to it in Section 8.1.

     “Member Nonrecourse Debt” has the meaning ascribed to such term in Regulation Section 1.704-2(b)(4).

     “Member Nonrecourse Debt Minimum Gain” means the aggregate amount of gain (of whatever character), determined for each Member Nonrecourse Debt, that would be realized by the Company if it disposed of the Company property subject to such Member Nonrecourse Debt in a taxable transaction in full satisfaction thereof (and for no other consideration) determined in accordance with the provisions of Regulation Section 1.704-2(i)(5) for determining a Member’s share of minimum gain attributable to a Member Nonrecourse Debt.

     “Member Nonrecourse Deductions” means the excess, if any, of (i) the net increase, if any, in the amount of Member Nonrecourse Debt Minimum Gain during any Fiscal Year over (ii) the aggregate amount of any distributions during such Fiscal Year of proceeds of a Member Nonrecourse Debt that are allocable to an increase in Member Nonrecourse Debt Minimum Gain, determined after application of Regulation Section 1.704-2(k).

     “Newspaper Agency Corporation” or “NAC” mean the Newspaper Agency Corporation, a Utah corporation.

     “Non-Defaulting Member” shall have the meaning ascribed in Section 3.4.

     “Nonrecourse Deductions” shall have the meaning set forth in Regulation Section 1.704-2(b)(1).

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     “Nonrecourse Liability” shall mean any Company liability (or portion thereof) for which no Member or a related person (as defined in Regulation Section 1.752-4(b)) bears the economic risk of loss for that liability under Regulation Section 1.752-2.

     “Percentage Interest” means, for K-T, LLC, or its successor-in-interest, fifty-eight percent (58%) and for DNPC, or its successor-in-interest, forty-two percent (42%), as may be adjusted from time to time in accordance with this Agreement.

     “Profits” and “Losses” means, for each Fiscal Year or part thereof, the taxable income or loss of the Company for such Fiscal Year determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments:

               (i) any income of the Company that is exempt from federal income tax shall be added to such taxable income or loss;

               (ii) any expenditures of the Company described in Code Section 705(a)(2)(B) or treated as such pursuant to Regulation Section 1.704-1(b)(2)(iv)(i) shall be subtracted from such taxable income or loss;

               (iii) any Depreciation for such Fiscal Year or part thereof shall be taken into account in lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss;

               (iv) gain or loss resulting from any disposition of Company property with respect to which gain or loss is recognized for federal income tax purposes shall be computed with reference to the Book Value of the property disposed of, rather than the adjusted tax basis of such property;

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               (v) in the event the Book Value of any Company asset is adjusted pursuant to Section (ii), (iii) or (iv) of the definition of Book Value hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such assets for purposes of computing Profits and Losses; and,

               (vi) such taxable income or loss shall be deemed not to include any income, gain, loss, deduction or other item thereof allocated pursuant to Section 4.2(c) or Section 4.3.

     “Regulations” means the income tax regulations promulgated under the Code by the Department of the Treasury, as such regulations may be amended from time to time.

     “Reserved Matters” shall have the meaning ascribed in Sections 3.2, 7.2 and 8.1.

     “Substitute Member” shall have the meaning ascribed in Section 9.3.

     “Tax Matters Member” shall have the meaning ascribed in Section 6.3.

     “Transfer” means any sale, assignment, gift, hypothecation, pledge, encumbrance, alienation, mortgage or other disposition, whether voluntary or by operation of law, of an Interest or any portion thereof.

     “Transferee” means a purchaser, transferee, assignee (other than collateral assignees) or any other person who takes, in accordance with the terms of this Agreement, an Interest in the Company, and who thereby becomes bound by all the terms of this Agreement, regardless of whether such person becomes a Substitute Member.

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ARTICLE II
The Limited Liability Company

     2.1 Formation. Articles of Organization for the Company were filed with the Utah Division of Corporations and Commercial Code on May 23, 2006 in conformity with the Act. All of the Members undertake hereafter to execute or cause to be executed from time to time all other instruments, certificates, notices and documents, and to do or cause to be done all such filing, recording, publishing and other acts, in each case, as may be necessary or appropriate from time to time to comply with all applicable requirements for the operation and, when appropriate, termination of a limited liability company in the State of Utah and all other jurisdictions where the Company shall desire to conduct its business.

     2.2 Name. The name of the Company shall be “Newspaper Agency Company, LLC,” and its business shall be carried on in this name with such variations and changes, if any, as may be necessary or appropriate to comply with the requirements of the jurisdictions in which the Company’s operations are conducted.

     2.3 Business Purpose. The purpose of the Company (the “Business Purpose”) is to carry on any lawful business and to engage in any lawful act or activity for which a limited liability company may be formed under the Act or other applicable laws of the State of Utah; provided, however, that except as the Members shall approve otherwise, the Company’s activities shall hereafter be limited to acting as the agent of the members as contemplated by the Amendment and Restatement of Agreement dated as of July 1, 2006 which is attached as Exhibit 1 to this Agreement (the “Salt Lake JOA”), as the same may hereafter be amended and/or restated.

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     2.4 Registered Agent. The registered office of the Company in the State of Utah and its registered agent for service of process on the Company in the State of Utah shall be as set forth in the Articles of Organization of the Company, as filed with the Division of Corporations and Commercial Code of the State of Utah, as the same may be amended from time to time.

     2.5 Term. The term of the Company shall continue until dissolved and liquidated in accordance with Article X hereof.

     2.6 Principal Place of Business. The Company shall maintain its principal place of business within the county of Salt Lake, Utah, at such location or locations as it may from time to time select.

     2.7 Title to Company Property. Legal title to all property of the Company shall be held and conveyed in the name of the Company.

     2.8 The Members. The name and place of residence of each Member is as follows:

Name	Address
Kearns-Tribune, LLC	c/o Media News Group, Inc.
	1560 Broadway, Suite 2100
	Denver, CO 80202
Deseret News Publishing Company	30 East 100 South
	Salt Lake City, UT 84111

     2.9 Fiscal Year. Unless the Management Committee shall at any time otherwise determine, the fiscal year and taxable year of the Company shall hereafter end on June 30^th of each year unless otherwise required by Section 706 of the Code.

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     2.10 Representations and Warranties of the Parties. Each of the parties represents and warrants that:

          (a) It is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization;

          (b) It has all requisite power and authority to enter into this Agreement; the execution and delivery by such party of this Agreement and the consummation by such party of the transactions contemplated hereby have been duly authorized by all necessary action on the part of such party; and this Agreement has been duly and validly executed and delivered by such party and constitutes (assuming the due and valid execution and delivery of this Agreement by the other party), the legal, valid and binding obligation of such party, enforceable against it in accordance with its terms;

          (c) There is no litigation pending or, to the best knowledge of such party, threatened against such party which has a reasonable likelihood of materially and adversely affecting the operations, properties or business of the Company or any of such party’s obligations under this Agreement;

          (d) The execution, delivery and performance by such party of this Agreement will not result in a breach of any of the terms, provisions or conditions of any agreement to which such party is a party which has a reasonable likelihood of materially and adversely affecting the operations, properties or business of the Company or such party’s obligations under this Agreement;

          (e) The execution and delivery by such party of this Agreement and the continuation of the Company as a limited liability company does not require any filing by

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such party with, or approval or consent of, any governmental authority which has not already been made or obtained; and,

          (f) It is acquiring or has acquired its Interest for its own account for investment, without a view to, or for, resale in connection with the distribution thereof in violation of U.S. federal or state securities laws, and with no present intention of distributing or reselling any part thereof.

          (g) The Company shall receive good and marketable title to the assets contributed by it.

     2.11 Survival of Representations and Warranties. The representations and warranties of each of the parties contained in Section 2.10 of this Agreement are each made as of the Effective Date of this Agreement and shall survive until the dissolution of the Company.

ARTICLE III
Capital Structure and Contributions

     3.1 Capital Contributions. In addition to the Member’s initial capital contributions, in the event it shall from time to time be determined, in the manner set forth in Section 6.06 of the Salt Lake JOA, that the Company shall hereafter require funds for any authorized business purpose, all such funds, unless duly authorized hereunder to be obtained from outside sources, shall be contributed by the Members in proportion to their Percentage Interests, when and as such additional contributions may be duly authorized pursuant to the provisions of Section 6.06 of the Salt Lake JOA. Any such authorization will be a Reserved Matter.

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     3.2 Failure to Make Capital Contributions. If either Member (the “Defaulting Member”) fails to make any capital contribution required under this Agreement, the other Member (the “Non-Defaulting Member”) may, as provided in Section 6.06 of the Salt Lake JOA, lend the amount thereof to the Defaulting Member by contributing such amount to the Company on behalf of the Defaulting Member. In any such event, as provided in Section 6.06 of the Salt Lake JOA, (i) no distributions shall thereafter be made to the Defaulting Member by the Company pursuant to Section 5.2 hereof or otherwise until the full amount of each such loan that was made or incurred by the Non-Defaulting Member, plus interest from the date of default to the date(s) of such repayment(s) at the rate provided in Section 6.06 of the Salt Lake JOA, has been paid in full to the Non-Defaulting Member by the Defaulting member and (ii) all such distributions which are thus withheld by the Company from the Defaulting Member shall instead concurrently be paid by the Company to the Non-Defaulting Member in repayment of such party’s loan(s). If more than one loan is made by a Non-Defaulting Member in accordance with this Section 3.3, all repayments shall first be applied to interest owing on the loans in the order in which the loans were made and then to principal owing on the loans in the same order. All such loans, to the extent not earlier repaid in the manner hereinafter provided, shall be due and payable in full on the third anniversary of the failure to make the capital contribution which gave rise to such indebtedness.

     3.3 No Right to Return of Capital Contributions. No Member shall hereafter have the right to have returned to it any portion of its Capital Contributions or be paid any distributions from the Company, except as provided in Articles V or XI hereof.

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     3.4 Loans by Third Parties. Subject to any applicable provisions of Article VIII hereof, the Company may borrow funds from or enter into credit, guarantee, financing or refinancing arrangements for any purpose with any Member (provided that each of the Members is given reasonable notice and is afforded a pro rata opportunity to participate therein) or from any other person, upon such terms as the Management Committee determines appropriate.

ARTICLE IV
Capital Accounts; Allocation of Profits and Losses

     4.1 Capital Accounts. Each Member shall have a capital account (a “Capital Account”) which account shall be (1) increased by the amount of (a) the Capital Contributions of such Member, (b) the allocations to such Member of Profits and items of income or gain pursuant to Section 4.2, and (c) any positive adjustment to such Capital Account by reason of an adjustment to the Book Value of Company assets (but only to the extent not included in (b)), and (2) decreased by the amount of (x) any cash and the Book Value of any property (net of liabilities secured by such property that such Member is considered to assume or take subject to under Code Section 752) distributed to such Member (including any distribution withheld from such Member and applied to repay a loan to such Member pursuant to Section 3.4 hereof), (y) the allocation to such Member of Losses and items of loss pursuant to Section 4.2, and (z) any negative adjustment to such Capital Account by reason of an adjustment to the Book Value of the Company assets (but only to the extent not covered in (y)). The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with

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Regulation Section 1.704-1(b), and shall be interpreted and applied in a manner consistent with such Regulation.

     4.2 Book Allocation.

          (a) In General. This Section 4.2 sets forth the general rules for book allocations of Profits, Losses and similar items to the Members.

          (b) Profits and Losses. After giving effect to the special allocations provided in Section 3 of the Salt Lake JOA and Section 4.2(c) hereof, Profits and Losses shall be allocated to the Members in proportion to their Percentage Interests.

          (c) Special Rules. Notwithstanding the general allocation rules set forth in Section 4.2(b), the following special allocation rules shall apply under the circumstances described.

               (i) Limitation on Loss Allocations. The Losses allocated to any Member pursuant to Section 4.2(b) with respect to any Fiscal Year shall not exceed the maximum amount of Losses that can be so allocated without causing such Member to have an Adjusted Capital Account Deficit at the end of such Fiscal Year. All Losses in excess of the limitation set forth in this Section 4.2(c)(i) (the “Excess Losses”) shall be allocated (1) first, to those Members who will not be subject to this limitation, in the ratio that their Percentage Interests bear to each other, and (2) second, any remaining amount to the Members in the manner required by the Code and the Regulations.

               (ii) Qualified Income Offset. If in any Fiscal Year a Member unexpectedly receives an adjustment, allocation or distribution described in Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), and such adjustment, allocation or distribution causes or increases an Adjusted Capital Account Deficit for such Member, then, before

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any other allocations are made under this Agreement except for allocations under 4.2(c)(iii), (iv), (v) and (vi) of this Agreement (which shall be made before any other allocations under this Agreement) or otherwise, such Member shall be allocated items of income and gain (consisting of a pro rata portion of each item of Company income, including gross income and gain) in an amount and manner sufficient to eliminate such Adjusted Capital Account Deficit as quickly as possible. This Section 4.2(c)(ii) is intended to comply with the qualified income offset requirement of Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

               (iii) Company Minimum Gain Chargeback. If there is a net decrease in Company Minimum Gain during any Fiscal Year, except as otherwise provided in Regulation Section 1.704-2(f), each Member shall be allocated items of income and gain for such Fiscal Year (and, if necessary, for subsequent Fiscal Years) in proportion to, and to the extent of, such Member’s share of the net decrease in Company Minimum Gain during such Fiscal Year determined in accordance with Regulation Section 1.704-2(g). This Section 4.2(c)(iii) is intended to comply with the minimum gain chargeback requirement of Regulation Section 1.704-2(f) and the ordering rules set forth in Regulation Section 1.704-2(j) and shall be interpreted consistently therewith.

               (iv) Member Nonrecourse Debt Minimum Gain Chargeback. If there is a net decrease in Member Nonrecourse Debt Minimum Gain during any Fiscal Year, then, except as otherwise provided in Regulation Section 1.704-2(i)(4), each Member who has a share of Member Nonrecourse Debt, determined in accordance with Regulation Section 1.704-2(i)(5), shall be allocated items of income and gain for such

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Fiscal Year (and, if necessary, for subsequent Fiscal Years) in proportion to, and to the extent of, such Member’s share of the net decrease in Member Nonrecourse Debt Minimum Gain during such Fiscal Year determined in accordance with Regulation Section 1.704-2(i)(4). This Section 4.2(c)(iv) is intended to comply with the chargeback of partner nonrecourse debt minimum gain requirement of Regulation Section 1.704-2(i)(4) and the ordering rules set forth in Regulation Section 1.704-2(j) and shall be interpreted consistently therewith.

               (v) Member Nonrecourse Deductions. Member Nonrecourse Deductions shall be allocated among the Members in accordance with the ratio in which the Members share the economic risk of loss for the Member Nonrecourse Debt that gave rise to those deductions. This allocation is intended to comply with the requirements of Regulation Section 1.704-2(i) and shall be interpreted consistently therewith.

               (vi) Nonrecourse Deductions. Nonrecourse Deductions for any Fiscal Year shall be allocated to the Members in proportion to their Percentage Interests.

               (vii) Limited Effect and Interpretation. The special rules set forth in Sections 4.2(c)(i), (ii), (iii), (iv), (v) and (vi) (the “Regulatory Allocations”) shall be applied only to the extent required by applicable Regulations for the resulting allocations provided for in this Section 4.2, taking into account such Regulatory Allocations, to be respected for federal income tax purposes. The Regulatory Allocations are intended to comply with the requirements of Regulation Sections 1.704-1(b), 1.704-2 and 1.752-1 through 1.752-5 and shall be interpreted and applied consistently therewith.

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               (viii) Curative Allocations. The Regulatory Allocations may not be consistent with the manner in which the Members intend to divide the Company Profits, Losses and similar items. Accordingly, Profits, Losses and other items will be reallocated among the Members in a manner consistent with Regulations Section 1.704-1(b) and 1.704-2 so as to negate as rapidly as possible any deviation from the manner in which Company Profits, Losses and other items are intended to be allocated among the Members pursuant to Section 4.2(b) that is caused by the Regulatory Allocations.

               (ix) Change in Regulations. If the Regulations incorporating the Regulatory Allocations are hereafter changed or if new Regulations are hereafter adopted, and such changed or new Regulations, in the opinion of independent tax counsel for the Company, make it necessary to revise the Regulatory Allocations or provide further special allocation rules in order to avoid a significant risk that a material portion of any allocation set forth in this Article IV would not be respected for federal income tax purposes, the Members shall negotiate in good faith any amendments to this Agreement as, in the opinion of such counsel, are necessary or desirable, taking into account the interests of the Members as a whole and all other relevant factors, to avoid or reduce significantly such risk to the extent possible without materially changing the amounts allocable and distributable to any Member pursuant to this Agreement.

               (x) Change in Members’ Interests. If there is a change in any Member’s Percentage Interest during any Fiscal Year, allocations among the Members shall be made in accordance with their Percentage Interests from time to time during such Fiscal Year in accordance with Code Section 706, using the closing-of-the-books

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method, except that Depreciation shall be deemed to accrue ratably on a daily basis over the entire Fiscal Year during which the corresponding asset is owned by the Company.

     4.3 Tax Allocations.

          (a) In General. Except as set forth in Section 4.3(b), allocations for tax purposes of items of Profit, Loss and other items of gain, deduction, credit and distribution therefor, shall be made in the same manner as allocations for book purposes set forth in Section 4.2(b). Allocations pursuant to this Section 4.3 are solely for purposes of federal, state and local income taxes and shall not affect or in any way be taken into account in computing, any Member’s Capital Account or share of Profits, Losses, other items or gain, deduction and distribution pursuant to any provision of this Agreement.

          (b) Special Rules.

               (i) Elimination of Book/Tax Disparities. In determining a Member’s allocable share of Company taxable income, the Member’s allocable share of each item of Profits and Losses shall be properly adjusted to reflect the difference between such Member’s share of the adjusted tax basis and the Book Value of Company assets used in determining such item. Items of depreciation, amortization, and gain or loss with respect to any contributed property, or with respect to revalued property where Company property is revalued pursuant to Regulation Section 1.704-1(b)(2)(iv)(f), shall be allocated to the Members under the remedial method as provided in Regulation Section 1.704-3(d). This Section 4.3(b)(i) is intended to comply with the requirements of Code Section 704(b) and Section 704(c) and Regulation Sections

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1.704-1(b)(2)(iv)(d)(3) and 1.704-3 and shall be interpreted and applied consistently therewith.

               (ii) Allocation of Items Among Members. Except as otherwise provided in Section 4.3(b)(i), each item of income, gain, loss and deduction and all other items governed by Code Section 702(a) shall be allocated among the Members in proportion to the allocation of Profits, Losses and other items to the Members hereunder, provided that any gain recognized from any disposition of a Company asset that is treated as ordinary income because it is attributable to the recapture of any depreciation or amortization shall be allocated among the Members in the same ratio as the prior allocations of tax depreciation or amortization, but not in excess of the gain otherwise allocable to each Member.

               (iii) Tax Credits. Any tax credits shall be allocated among the Members in accordance with Regulation Section 1.704-1(b)(4)(ii), unless the applicable Code provision shall otherwise require.

          (c) Conformity of Reporting. The Members are aware of the income tax consequences of the allocations made by this Section 4.3 and hereby agree to be bound by the provisions of this Section 4.3 in reporting their shares of Company profits, gains, income, losses, deductions, credits and other items for income tax purposes.

          (d) Excess Nonrecourse Liabilities. For purposes of determining a Member’s proportionate share of the excess nonrecourse liabilities of the Company within the meaning of Regulation Section 1.752-3(a)(3), the Members’ interests in the Company Profits are in proportion to their Percentage Interests.

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ARTICLE V
Distributions

     5.1 In General. Except as otherwise provided herein and in Section 3 of the Salt Lake JOA, all distributions shall be made in proportion to the Members’ Percentage Interests.

     5.2 Periodic Distributions. Periodic distributions of cash flows from the Company’s operations shall be made in the manner set forth in Sections 3 and 4 of the Salt Lake JOA, subject to the provisions of Section 3.3 hereof relating to payments on loans made by a Non-Defaulting Member. Subject to the foregoing, all distributions shall be made in proportion to the Members’ Percentage Interests in the manner provided in Sections 3 and 4 of the Salt Lake JOA.

ARTICLE VI
Accounting and Reports

     6.1 Books and Records.

          (a) The Company shall maintain or cause to be maintained at an office of the Company this Agreement and all amendments thereto and full and accurate books of the Company showing all receipts and expenditures, assets and liabilities, Profits and Losses, and all other books, records and information required by the Act as necessary for recording the Company’s business and affairs. The Company’s books and records shall be maintained in accordance with GAAP except to the extent otherwise provided hereunder for purposes of maintaining Capital Accounts in accordance with Article IV hereof and calculating the Profits or Losses charged or credited thereto. Such documents, books and records shall be maintained at such

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office or such designated successor office until six (6) years after the termination and liquidation of the Company.

          (b) Each Member shall, upon 24 hours’ advance notice, have the right at reasonable times during usual business hours to inspect the facilities of the Company, to observe the Company’s operations and to examine and make copies of the books of account including books and records of the Company relating to the reserves, assets, liabilities and expenses of the Company and expenditures by the Management Committee on behalf of the Company; provided, however, that none of the foregoing activities shall be conducted in a manner that unreasonably interferes with the Company’s operations or business or the Management Committee’s management thereof. Such right may be exercised through any agent or employee of a Member designated in writing by it or by an independent public accountant, engineer, attorney or other consultant so designated. The Member making the request shall bear all expenses incurred in any inspection or examination made at such Member’s behest. Should any inspection or examination disclose any errors or improper charges, the Management Committee shall make, or cause to be made, appropriate adjustments therefor.

     6.2 Reports to Members.

          (a) Each Member shall be entitled: (i) promptly upon their availability and in any event within eight (8) business days after the end of each quarterly period in each fiscal year, to an unaudited balance sheet and unaudited statements of income or loss and cash flows for the quarterly period then ended and for the fiscal year-to-date, and (ii) promptly upon their availability and in any event within sixty (60) days after the

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end of each fiscal year, to an audited balance sheet of the Company as at the end of such fiscal year, and audited statements of income or loss and cash flows for such fiscal year, all in reasonable detail and accompanied by an opinion thereon of the Company’s independent certified public accountants, such balance sheet and statements of income or loss and cash flows to include a comparison of the current fiscal year with the fiscal year immediately preceding, if any.

          (b) The Company shall, in addition, provide to each Member such information as may be necessary for it to comply with applicable financial reporting requirements of any competent governmental authorities or agencies or of any stock exchange on which the shares of any such Member or Affiliate are listed including, without limitation, the New York Stock Exchange and the U.S. Securities and Exchange Commission, and such information regarding the financial position, business, properties or affairs of the Company as a Member may reasonably request.

     6.3 Tax Matters Member/Annual Tax Returns.

          (a) K-T, LLC (or its successor-in-interest) is hereby designated hereafter to serve as the “Tax Matters Member” for federal income tax purposes pursuant to Section 6231 of the Code and is authorized to do whatever is necessary to qualify as such. K-T, LLC shall serve as the Tax Matters Member until the end of the fourth taxable year following the Effective Date (the “Initial Tax Matters Term”). After the end of the Initial Tax Matters Term, DNPC (or its successor-in-interest) shall be the Tax Matters Member for the next four taxable years of the Company. Thereafter, K-T, LLC and DNPC shall serve alternate four year terms as the Tax Matters Member, starting again with K-T, LLC. If a Member resigns as the Tax Matters Member, the

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Member who is next due to serve as the Tax Matters Member shall serve out the remainder of the term of the Member who resigned. The Tax Matters Member shall, as soon as practicable under the circumstances, inform each Member of all tax-related matters that are, or have the reasonable potential to become, material to one or both Members that come to its attention as Tax Matters Member.

          (b) Notwithstanding the designation of a Member as the Tax Matters Member:

               (i) any right or power delegated by the Code to the Tax Matters Member may be exercised by Absolute Majority Vote of the Management Committee;

               (ii) no tax return, tax form or (except as provided in Section 6.5) any election shall be filed with or sent to the U.S. or any foreign government without the approval of the Management Committee. If an unresolvable dispute arises over any such return, form or letter of election, the Company’s firm of independent accountants or another firm of independent accountants, as selected by the Management Committee (by Absolute Majority Vote), shall be engaged to settle such dispute and the determination of the firm so selected shall be final;

               (iii) each Member shall have the right to review all tax returns, tax forms, letters and other tax related documents of the Company and all information necessary to support any item on any tax return, tax form, letter or other tax-related document of the Company at least 30 days prior to the filing thereof.

          (c) The Tax Matters Member shall prepare or cause to be prepared all tax or informational returns required of the Company and/or relating to the Members, which returns shall be reviewed in advance of filing by the Member’s and the

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Company’s independent accountants and shall be approved for filing and/or distribution to the Members by the Management Committee. Within ninety (90) days after the end of each taxable year, the Tax Matters Member shall cause to be furnished to each Member such information in the possession of the Tax Matters Member or its Affiliate as may be requested by such Member as necessary to timely fulfill such Member’s federal, state, local and foreign tax obligations, including Form K-1, or any similar form as may be required by the Code or the Internal Revenue Service (the “IRS”) or, to the extent any such information is not in the Tax Matters Member’s possession, the Tax Matters Member shall take all reasonable steps necessary to have such information provided to the requesting Member. The Tax Matters Member and the Management Committee shall consider in good faith, consistent with Section 6.3(a) and (b) hereof, any comments of the Members with respect to such Form K-1 or similar form made within thirty (30) days of the Member’s receipt of a copy thereof. The Members shall file their corporate or partnership returns in a manner consistent with the Company tax and information returns.

          (d) The Tax Matters Member shall, consistent with the Business Plan, use its best efforts to do all acts and take whatever steps are required to maximize, in the aggregate, the federal, state and local income tax advantages available to the Members and shall defend all tax audits and litigation with respect thereto. The Tax Matters Member shall maintain the books, records and tax returns of the Company in a manner consistent with the acts, elections and steps taken by the Company.

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          (e) The Tax Matters Member shall be reimbursed for all out-of-pocket expenses reasonably and appropriately incurred in connection with the performance of its duties as such.

     6.4 Actions in Event of Audit. If any tax audit of any of the Company’s books and records shall occur, each Member shall, at its own expense, be offered an appropriate opportunity to participate in such audit. No Member may contest, settle or otherwise compromise assertions of the auditing agent which may be adverse to the Company or the other Member without the approval of the Management Committee. The Management Committee may, if it determines that the retention of accountants or other professionals would be in the best interests of the Company, retain such accountants or other professionals, to assist the Company in any such audits. Neither the Tax Matters Member nor any other Member shall have any obligation to provide funds for or in connection with such audit, and the taking of any action and the incurring of any expense by the Management Committee or the Members in connection with any such audit, except to the extent required by law, is a matter in the sole discretion of the Management Committee or the Members, as the case may be.

     6.5 Tax Election. The Tax Matters Member shall, at the request of both Members, cause the Company to file an election under Code Section 754 and the Regulations thereunder and a corresponding election under the applicable section of state and local law.

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ARTICLE VII
Actions by Members

     7.1 Meetings/Actions by Members. Meetings of the Members shall hereafter be held at the place and time designated from time to time by any Member upon at least five (5) business days prior written notice to the other Member. Subject to the provisions of Section 7.3 hereof, such meetings may be in person or by telephone. K-T, LLC and DNPC (or their successors-in-interest), whether present in person or by proxy, shall constitute a quorum for the transaction of business at any meeting of the Members. Subject to the provisions of this Agreement, any matter brought before a meeting of the Members shall be decided by unanimous vote of the Members present at a duly constituted meeting at which a quorum is present, except as otherwise expressly provided in this Agreement. The Chairman of the Management Committee (if present in person) shall preside at all meetings of the Members. In the absence of the Chairman of the Management Committee, such other person as shall be selected by the unanimous vote of those in attendance shall preside over a meeting of the Members. The Company shall promptly deliver written notice of any action taken at a meeting to any Member not present at such meeting.

     7.2 Certain Matters Requiring Approval of the Members. “Reserved Matters” are those actions requiring the written approval of all of the Members. In addition to Reserved Matters identified as such elsewhere in this Agreement, the following shall be considered Reserved Matters:

          (a) admit any new Member or Substitute Member to the Company and determine the terms upon which such new Member or Substitute Member is to be admitted;

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          (b) require additional capital contributions or loans from the Members except as otherwise expressly contemplated in Section 3.2 hereof;

          (c) sell, lease or otherwise dispose of any material assets of the Company,

          (d) commit or cause the Company to acquire all or substantially all of the capital stock or all or substantially all of the assets of any person or business;

          (e) cause the Company to create, or enter into, as applicable, any consolidation, partnership, joint venture, association, trust or other business entity;

          (f) merge or consolidate with any person;

          (g) except as permitted pursuant to Article XI of this Agreement, dissolve or liquidate the Company;

          (h) authorize the issuance of any securities by the Company, except as otherwise may be expressly permitted in this Agreement;

          (i) adopt or approve any amendment to this Agreement;

          (j) add to or change the Business Purpose of the Company;

          (k) enter into any line of business not contemplated by the Company’s Business Purpose;

          (l) any Reserved Matters as defined in the Salt Lake JOA.

     7.3 Action by Consent. Any action permitted or required to be taken on behalf of the Company at any meeting of the Members pursuant to Section 7.2 of this Agreement may be taken without a meeting, by written consent signed by the Members required to approve such action, provided that each Member is given notice of such

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proposed action at least 48 hours prior to the taking of such action and is provided a written copy of the action promptly after its adoption.

     7.4 Limitation on Rights of Defaulting Member. Notwithstanding anything in this Agreement to the contrary, a Defaulting Member, as defined in Section 3.4 hereof, shall, during the continuance of the default, have none of the rights of a Member under this Article VII, and all rights of Members under this Article VII relating to any such matter shall, during the continuance of such default, be exercised solely by the Non-Defaulting Member.

ARTICLE VIII
Management Committee

     8.1 The Management Committee. Except for matters which are reserved under the terms of this Agreement, by the Articles of Organization or by the Act to be exercised, done or approved by the Members, the business and affairs of the Company shall hereafter be managed under the direction and authority of the Management Committee, as defined and instituted, in the manner provided in Section 2.02 of the Salt Lake JOA.

          8.2 Limitation of Rights of Defaulting Member. Notwithstanding anything in this Agreement to the contrary, the Managers appointed by a Defaulting Member shall, during the continuance of the default, have no rights as Managers under this Article VIII, and all rights of the Managers under this Article VIII shall, during the continuance of such default, be exercised solely by the Managers appointed by the Non-Defaulting Member.

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          8.3 Officers, etc. A Chairman and Vice-Chairman of the Management Committee, other officers, and an Executive Committee, shall be appointed and function as contemplated in Sections 2.03 through 2.06 of the Salt Lake JOA.

ARTICLE IX
Transfer of Company Interests; Additional and Substitute Members

     9.1 Prohibited Transfers. Except as otherwise provided by law, all of the following prohibitions and restrictions on Transfers shall apply:

          (a) No Transfer may be made of any Member’s Interest except to the extent permitted by Section 2.01 of the Salt Lake JOA. :

          (b) No Transfer may be made of only a part of a Member’s Interest. The intent of the Members is that there will never be more than two Members.

          (c) Any Transfer not prohibited in subsection (a) above may be made only upon compliance with the provisions of this Agreement, including, to the extent by its terms applicable, the provisions of Section 9.2 hereof.

     Any Transfer in violation of this Article IX shall be null and void as against the Company and any and all other persons, and the transferring Member shall be liable to the Company and the other Member for all damages that they may sustain as a result of such attempted Transfer.

     9.2 Permitted Transfers by Members. With respect to any Transfer by a Member of its Interest that is not prohibited under Section 9.1, no such Transfer, except a Transfer pursuant to Section 9.1 herein or a Transfer by either Member to the other Member, shall hereafter be made unless:

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          (a) the Member desiring to consummate such Transfer (the “Assigning Member”), and the prospective Transferee shall each execute, acknowledge and deliver to the Company such instruments of transfer and assignment with respect to such Transfer and such other instruments as may be reasonably satisfactory in form and substance to the Management Committee;

          (b) the Transfer shall not violate any federal or state securities laws or other laws;

          (c) the Transfer shall not cause any nonrecourse debt that is not already Member Nonrecourse Debt to become Member Nonrecourse Debt;

          (d) the Transfer shall not result in or create a “prohibited transaction” as defined in Section 4975(c) of the Code, or result in or cause the Company or any Member, or any Affiliate of a Member, to be liable for any excise tax under Chapter 42 of the Code, or result in or cause any Interest or the Company’s assets to become an asset of an employee benefit plan (as defined in Section 3(3) of ERISA);

          (e) the Transfer shall not cause any violation of or an event of default under, or result in acceleration of any indebtedness under, any note, mortgage, loan, or similar instrument or document to which the Company is a party;

          (f) the Transfer shall not cause a material adverse tax consequence to the Company or any of the Members, including but not limited to any material adverse tax consequence resulting, directly or indirectly, from the termination of the Company under Section 708 of the Code; and,

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          (g) the Transfer, except a Transfer from one Member to the other Member, shall not cause the Company to be classified as an entity other than a partnership for purposes of the Code.

     9.3 Substitute Member. A Transferee of the entirety of an Interest (other than a Transferee pursuant to an Involuntary Transfer pursuant to Section 9.4 of this Agreement) who satisfies the conditions set forth in Section 9.2 hereof shall hereafter have the right to become a Member in place of the Assigning Member (a “Substitute Member”), but only if all of the following conditions are satisfied:

          (a) the fully executed and acknowledged written instrument of assignment that has been filed with the Company sets forth a statement of the intention of the Assigning Member that the Transferee become a Substitute Member in its place;

          (b) the Transferee executes, adopts and acknowledges this Agreement (as it may be amended) and agrees to assume all the obligations of the Assigning Member;

          (c) any costs of the Transfer incurred by the Company shall have been reimbursed by the Assigning Member or the Transferee to the Company.

     Any Transferee that does not become a Substitute Member shall not be entitled to exercise any rights of a Member or be entitled to any interest in the Company other than such rights as the transferor may have held in the Profits, Losses and/or capital of the Company.

     9.4 Involuntary Transfers.

          (a) Upon any Transfer hereafter of a Member’s Interest due to bankruptcy, or other insolvency, involuntary dissolution or liquidation of a Member, or

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foreclosure or other exercise of any remedies by a party holding a security interest in the Interest of a Member (each, an “Involuntary Transfer”), or upon the occurrence of a “Bankruptcy Event” with respect to any Member, neither such Member nor any Transferee of a Member’s Interest as a result of an Involuntary Transfer or a Bankruptcy Event shall thereafter be entitled to exercise any rights of a Member, nor shall either thereby or thereafter be entitled to any Interest in the Company other than such rights as such Member may have held, immediately prior to the occurrence of the Involuntary Transfer or Bankruptcy Event, in the Profits, Losses and/or capital of the Company. A Transferee by Involuntary Transfer of a Member’s Interest or a result of a Bankruptcy Event shall not become a Substitute Member unless the remaining Member consents. Subject to subsection (c) below, the Company may elect to purchase the Interest which is the subject of an Involuntary Transfer or which is held by a Member that has suffered the occurrence of a Bankruptcy Event. Upon such election by the Company, the holder of such Interest shall transfer such Interest to the Company free and clear of all liens and encumbrances and shall be entitled to receive an amount equal to the fair market value of such Interest. The amount thus to be paid by the Company shall be paid in full in cash within sixty (60) days of the Company’s election to acquire such Interest. The Member whose Interest was the subject of the Involuntary Transfer or who suffered the occurrence of the Bankruptcy Event shall remain fully liable to the Company for all such Member’s outstanding debts, obligations and liabilities to the Company incurred while it was a Member.

          (b) (i) For the purposes of calculating the amount to be paid pursuant to the preceding sub-paragraph, “fair market value” as used therein shall be

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the amount that would be paid for the Interest in the Company as a going concern (taking into consideration the effects of the Involuntary Transfer or Bankruptcy Event), on a consolidated basis, by a willing buyer to a willing seller; provided, however, notwithstanding anything herein to the contrary, the entire negative effect of the Involuntary Transfer or Bankruptcy on the fair market value of the Company shall be charged to the Interest being valued. The Member who has suffered the Bankruptcy Event or the Transferee whose Interest is the subject of the Involuntary Transfer, as the case may be, and the remaining Member may mutually agree as to the fair market value of the Interest in question. If such Member or Transferee and the remaining Member are unable to agree on such fair market value within fifteen (15) days of the remaining Member’s election to purchase the subject Interest, then fair market value shall be determined pursuant to Section 9.4(b)(ii) by two independent qualified appraisers, one to be appointed by the Member or Transferee and one to be appointed by the remaining Member.

               (ii) The two independent appraisers shall be appointed within fifteen (15) days after receipt by such Member or Transferee of written notice from the remaining Member of its decision to determine fair market value by appraisal. If either side fails to appoint an appraiser within such period, then its right to do so shall lapse and the appraisal made by the one independent appraiser who is timely appointed shall be the fair market value. If two appraisals are made, and if the two appraised values differ by less than 15% of the higher appraised value, fair market value shall be the average of the two appraisals, and if the two appraised values differ by more than 15% of the higher appraised value, the two appraisers shall jointly select a third appraiser

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and, the fair market value shall be the average of the two of the three appraisals that are closest together in amount. All appraisals shall be made within sixty (60) days of appointment of an appraiser, and written notice of the results of such appraisals shall be given to all parties within such 30-day period. The fair market value of the Company shall be determined in its entirety as a going concern, with such Member or Transferee receiving a proportionate part of such total value based upon its Percentage Interest; provided, however, notwithstanding anything herein to the contrary, the entire negative effect of the Involuntary Transfer or Bankruptcy on the fair market value of the Company shall be charged to the Interest of such Member or Transferee whose Interest is being purchased. In making any appraisal hereunder, all debts and liabilities shall be taken into account. Each party shall pay the fees of the appraiser selected by it, and each side shall share evenly the fees of the third appraiser, if any.

          (c) Notwithstanding anything in this Section 9.4 to the contrary, the Company shall have the right, without liability, to rescind its election to purchase the Interest which is the subject of an Involuntary Transfer or which is held by a Member that has suffered the occurrence of a Bankruptcy Event at any time within fifteen (15) days after the fair market value of the Company has been determined. Notwithstanding anything in this Agreement to the contrary, all decisions by the Company that are contemplated by this Section 9.4 shall be made without any participation by the Member who has suffered the Bankruptcy Event of by any Manager subject to its appointment.

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ARTICLE X
Dissolution and Liquidation

     10.1 Dissolution. Except as provided in Section 10.2, the Company shall be dissolved upon the first to occur hereafter (each a “Dissolution Event”) of:

          (a) The sale, transfer or other disposition of all or substantially all the assets of the Company, including by condemnation or eminent domain;

          (b) The execution of an agreement in writing among all the Members to dissolve the Company; or

          (c) The entry of a decree of judicial dissolution of the Company.

For purposes of this Agreement, a Dissolution Event shall not be deemed to include any other event, including, but not limited to, any event specified under the Act as affecting the dissolution of a limited liability company formed under the Act.

     10.2 Closing of Affairs.

          (a) Except as otherwise contemplated in this Agreement, upon the occurrence of a Dissolution Event, the Members will meet and use their best efforts to develop a just and equitable plan for discontinuing and dissolving the Company and, to the extent both Members then continue to own and publish their respective newspapers (The Salt Lake Tribune and Deseret Morning News), for distributing the Company’s assets in kind between the Members (after collection of all receivables and payment of all indebtedness and liabilities of the Company and all costs of dissolution and liquidation), so as, to the extent practicable, to enable the Members to continue publication of The Salt Lake Tribune and Deseret Morning News, respectively, independently of the Company (a “Distribution Plan”), in the manner set forth in Section 13 of the Salt Lake JOA. If the Members agree on a Distribution Plan, the assets of the

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Company shall be distributed in accordance with the Distribution Plan, and the Company shall thereupon be dissolved. Except as provided in the Distribution Plan and upon effective distribution of assets by the Company pursuant thereto, no Member shall have any separate right, title or interest in or to any asset of the Company.

          (b) If the Members are unable to agree upon a Distribution Plan then, subject to the right of either party to petition for a court appointed receiver, as provided in Section 13 of the Salt Lake JOA, the Members shall commence to close the affairs of the Company, including payment of the Company’s liabilities and making such distributions to the Members as may be authorized hereunder and to terminate the existence of the Company, in each instance in the manner as the Members may reasonably determine to be appropriate. Upon complete liquidation of the Company’s property and compliance with the distribution provisions set forth in Section 10.2(c) hereof, the Company shall cease its existence, and the Management Committee shall cause to be executed, acknowledged and filed all certificates necessary to terminate the Company.

          (c) In liquidating the Company, the assets of the Company shall be applied to the extent permitted by the Act in the following order of priority:

               (i) First, to pay the costs and expenses of the closing of the affairs and liquidation of the Company;

               (ii) Second, to pay the matured debts and liabilities of the Company to third parties;

               (iii) Third, to establish reserves adequate to meet any and all contingent or unforeseen liabilities or obligations of the Company, provided that at the

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expiration of such period of time as the Members may deem advisable, the balance of such reserves remaining after the payment of such contingencies or liabilities shall be distributed as hereinafter provided;

               (iv) Fourth, to pay the matured debts and liabilities of the Company to the Members including those arising pursuant to Section 3.4 of this Agreement; and

               (v) Fifth, to all Members in proportion to each Member’s positive Capital Account balance at the time of the distribution of the assets.

     10.3 Orderly Liquidation. A reasonable time shall be allowed for the orderly liquidation of the assets of the Company and the discharge of liabilities so as to minimize the losses normally attendant upon a liquidation.

     10.4 Deficit Upon Liquidation. Except to the extent otherwise provided in this Agreement or by law with respect to third-party creditors of the Company, upon liquidation, none of the Members shall be liable to the Company for any deficit in its Capital Account, nor shall such deficits be deemed assets of the Company.

ARTICLE XI
Amendments to Agreement

     Amendments to this Agreement and to the Articles of Organization of the Company shall be approved in writing by all of the Members. An amendment shall become effective as of the date specified therein, or if none is specified as of the date of such approval or as otherwise provided in the Act.

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ARTICLE XII
Indemnification

     12.1 Remedies for Breach. Except as otherwise limited by this Agreement, each Member shall have such remedies at law or in equity or as provided in this Agreement for breach of the representations, warranties, obligations, and covenants of this Agreement by any other Member.

     12.2 Limitation of Liability. Notwithstanding any other provision of this Agreement, except with respect to actions, demands, proceedings or suits of third parties for which indemnification is required pursuant to Section 12.3, no Member shall be liable to any other Member or entity claiming by or through any other Member for any lost profits or any special, incidental, consequential, or punitive loss or damage arising out of this Agreement or any breach thereof or any actions or omissions in connection therewith or as the result of any investment in the Company by any Member or any rights as an investor or Member.

     12.3 Indemnification by Members for Breach of Representations or Warranties.

          (a) Indemnification. Each Member (the “Indemnifying Member”) agrees to defend and hold harmless the Company, any other Members and their affiliates, officers, directors, trustees, employees and agents, and any manager, officer, employee, or agent of the Company (each an “Indemnified Party”) from and against any action, demand, proceeding or suit, whether civil, criminal, administrative or investigative (an “Action”) threatened or brought against such Indemnified Party by a third party who is not the Company or a Member or an Affiliate of any Member or anyone claiming by or through the Company or a Member, and based on a claim which

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if true would mean that the Indemnifying Member had breached representations or warranties made by such Indemnifying Member in Section 2.10 of this Agreement; provided, that such indemnification shall be limited to (i) all costs of defense (including, but not limited to, reasonable investigation costs, reasonable attorney fees and all other reasonable costs of defending the Action at all adjudicatory levels), (ii) any monetary amounts required to settle such Action or to satisfy any judgment, order, award, or similar requirement entered in any such Action, (iii) the costs and expenses incurred by the Company in complying with, or avoiding by settlement, any injunctive or other relief sought by the party bringing such Action, and (iv) any actual monetary damages incurred by each Member other than the Indemnifying Member.

          (b) Notice and Defenses of Claims.

               (i) The Indemnified Party shall give prompt written notice to the Indemnifying Member of each Action that, in the opinion of the Indemnified Party, is likely to give rise to a right of indemnification under this Section 12.3; provided, however, that failure to give such notice of an Action shall not affect the obligations of the Indemnifying Member under this Section 12.3 except to the extent the Indemnifying Member has demonstrated actual damage caused by such failure. Such notice shall describe the Action in reasonable detail and shall indicate the amount (estimated, if necessary) of the loss that has been or may be suffered by the Indemnified Party.

               (ii) Subject to the provisions of this Section 12.3, the Indemnifying Member shall have the right to control and conduct at its own expense the defense and settlement of any such Action with counsel reasonably satisfactory to the Indemnified Party, provided, however, that the consent of all the Members (other than

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the Indemnifying Member) is required for any settlement which would materially affect the ability of the Company to engage in the business contemplated in its current Business Plan. Each Indemnified Party may also retain counsel at its own expense to participate in the defense of the Action.

               (iii) After notice from the Indemnifying Member of its election to control and conduct the defense and settlement of such Action, the Indemnifying Member shall not be liable to the Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Party in connection with defense and settlement of such Action. The Indemnified Party shall cooperate with the Indemnifying Member in connection with any such Action by making personnel, books and records (to the extent not inconsistent with any applicable legal privilege) relevant to the Action available to the Indemnifying Member, and grant such authorization as may reasonably be necessary in connection with the defense and settlement of any such Action.

               (iv) In the event that the Indemnifying Member does not wish to control and conduct the defense and settlement of any such Action, or any other Member (other than the Indemnifying Member) does not receive from the Indemnifying Member reasonable assurances (when requested by such other Member) that the Indemnifying Member will have the financial resources to defend the Action and fulfill its indemnification obligations hereunder, the Company shall have the right to control and conduct the defense and settlement of the Action without the participation of the Indemnifying Member, and will not be required to obtain the consent of the Indemnifying Member to any settlement of such Action.

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               (v) The Indemnified Party shall use its reasonable efforts consistent with sound business practice to mitigate the losses or damages for which indemnification is sought hereunder.

     12.4 Indemnification by Company.

          (a) Except as provided in subsection (k) below, the Company shall indemnify any person or entity that was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company), by reason of the fact that such person or entity is or was a member of the Management Committee, a Member, or officer or is or was serving at the request of the Company as a director, officer, employee, representative or agent of another entity, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person or entity in connection with such action, suit or proceeding if such person or entity acted in good faith and in a manner such person or entity reasonably believed to be in or not opposed to the best interest of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his, her or its conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that such person or entity did not act in good faith and in a manner which he, she or it reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his, her or its conduct was unlawful.

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          (b) Except as provided in subsection (k) below, the Company shall indemnify any person or entity that was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit in the right of the Company to procure a judgment in its favor by reason of the fact that such person or entity is or was a member of the Management Committee, a Member or officer of the Company, or is or was serving at the request of the Company as a director, officer, employee, representative or agent of another entity, against expenses (including attorneys’ fees) actually and reasonably incurred by him, her or it in connection with the defense or settlement of such action or suit if he, she or it acted in good faith and in a manner such person or entity reasonably believed to be in or not opposed to the best interests of the Company, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person or entity shall have been adjudged to be liable to the Company unless and only to the extent that a Utah state court or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person or entity is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper.

          (c) To the extent that a member of the Management Committee or a Member or officer of the Company has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in paragraphs (a) and (b) of this Section 12.4, or in defense of any claim therein, he, she or it shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him, her or it in connection therewith.

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          (d) Any indemnification under paragraphs (a) and (b) of this Section 12.4 (unless ordered by a court of competent jurisdiction) shall be made by the Company only as authorized in the specific case upon a determination that indemnification of the member of the Management Committee, a Member or officer is proper in the circumstances because he, she or it has met the applicable standard of conduct set forth in paragraphs (a) and (b) of this Section 12.4. Such determination shall be made (i) by the Management Committee by a majority vote of the members thereof who were not parties to such action, suit or proceeding (even if such persons constitute less than a quorum), (ii) if a majority of the disinterested members of the Management Committee (even if such persons constitute less than a quorum) so directs, by independent legal counsel in a written opinion or (iii) if no disinterested members of the Management Committee exist, by all Members.

          (e) Expenses (including attorneys’ fees) incurred by a member of the Management Committee or a Member in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the Company in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such person to repay such amount if it shall ultimately be determined that he, she or it is not entitled to be indemnified by the Company pursuant to this Section 12.4. Expenses (including attorneys’ fees) incurred by officers of the Company shall be paid upon such terms and conditions, if any, as the Management Committee deems appropriate.

          (f) The indemnification and advancement of expenses provided by, or granted pursuant to, this Section 12.4 shall not be deemed exclusive of any other rights

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to which those seeking indemnification or advancement of expenses may be entitled under any agreement, vote of the Members or vote of the disinterested members of the Management Committee or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office.

          (g) The indemnification and advancement of expenses provided by, or granted pursuant to, this Section 12.4 shall continue as to a person or entity who has ceased to be a member of the Management Committee, a Member or officer and shall inure to the benefit of the heirs, executors, administrators, successors or permitted assigns of such person or entity.

          (h) Notwithstanding anything in this Section 12.4 to the contrary, the Company shall not have the obligation of indemnifying any person or entity with respect to proceedings, claims or actions initiated or brought voluntarily by such person or entity and not by way of defense.

          (i) The Company may purchase and maintain insurance or another arrangement on behalf of any person or entity who is or was a member of the Management Committee, a Member, or an officer, employee, agent or other person or entity identified in this Section 12.4 against any liability asserted against such person or entity or incurred by such person or entity in such a capacity or arising out of the status of such a person or entity, whether or not the Company would have the power to indemnify such person or entity against that liability under this Section 12.4 or otherwise.

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          (j) The indemnification set forth in this Section 12.4 shall in no event cause the Members to incur any personal liability beyond their total Capital Contribution, nor shall it result in any liability of the Members to any third party.

ARTICLE XIII
General Provisions

     13.1 Arbitration.

          (a) Each Member agrees that, in the event of any deadlock with respect to any Reserved Matter (the “Dispute”), it will be resolved in the manner set forth in Section 26 of the Salt Lake JOA.

          (b) Nothing in this Agreement shall preclude a Member from seeking equitable or other relief from a court of competent jurisdiction when such relief is unavailable pursuant to the Rules, as defined in Section 26 of the Salt Lake JOA.

          (c) The parties hereto agree that given the nature of those matters that are the Reserved Matters, any arbitration relating to a Dispute shall be conducted and concluded as expeditiously as possible, and the parties shall use their best efforts to that end.

     13.2 Notices. Unless otherwise specifically provided in this Agreement, all notices and other communications required or permitted to be given hereunder to the Members shall be in writing, directed or addressed to the following respective addresses:

If to DNPC to:	Deseret News Publishing Company
	30 East First South
	Salt Lake city, Utah 84111
	Attention: Ellis R. Ivory, Chairman

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With a copy to:	Kirton & McConkie, P.C.
	Eagle Gate Tower
	60 East South Temple Street, Suite 1800
	Salt Lake City, Utah 84111
	Attention: Robert W. Edwards, Esq.
If to K-T, LLC to:	Kearns-Tribune, LLC
	c/o MediaNews Group, Inc.
	1560 Broadway, Suite 2100
	Denver, CO 80202
	Attention: Joseph J. Lodovic, IV, President
With a copy to:	Hughes Hubbard & Reed LLP
	1775 I Street, NW, Suite 600
	Washington, D.C. 20006
	Attention: Howell E. Begle, Jr., Esq.

and shall be either (i) delivered by hand, (ii) delivered by a nationally recognized commercial overnight delivery service, (iii) mailed postage prepaid by registered or certified mail, or (iv) transmitted by facsimile, with receipt confirmed. Such notices shall be effective: (a) in the case of hand deliveries, when received; (b) in the case of an overnight delivery service, when received in accordance with the records of such delivery service; (c) in the case of registered or certified mail, upon the date received by the addressee as determined by the U.S. Postal Service; and (d) in the case of facsimile notices, when electronic indication of receipt is received. Any Member may at any time change its address and telecopy number for all notices and other communications required or permitted to be given hereunder by written notice to the other Member given in accordance with this Section 13.2.

     13.3 Confidentiality. Each of the Members agrees that, except as required by law, legal process, government regulators, or as reasonably necessary for performance of its obligations or enforcement of its rights under this Agreement, without the prior

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written consent of the other Members, it will treat and hold as confidential (and not disclose or provide access to any person other than such Member’s attorneys or accountants) and it will cause its Affiliates, officers, managers, partners, employees and agents to treat and hold as confidential (and not divulge, provide access to any person, or use to the detriment of any Member or the Company) all confidential information disclosed by the Company and relating to (i) the business of the Company and (ii) any patents, inventions, designs, know-how, trade secrets or other intellectual property relating to the Company, in each case excluding (A) information in the public domain when received by such Member or thereafter in the public domain through sources other than such Member, (B) information lawfully received by such Member from a third party not subject to a confidentiality obligation, (C) information already in the possession of the Member, and (D) information developed independently by such Member. The obligations of the Members hereunder shall not apply to the extent that the disclosure of information otherwise determined to be confidential is required by applicable law, provided, however, that prior to disclosing such confidential information to any party other than a governmental agency exercising its ordinary regulatory oversight of a Member, a Member shall notify the Company thereof, which notice shall include the basis upon which such Member believes the information is required to be disclosed. This Section 13.3 shall survive for a period of four years with respect to any Member that withdraws from the Company and, for any period of time agreed to by the Members, with respect to any dissolution or termination of the Company pursuant to Article XII hereof.

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     13.4 Public Announcements. Except as required by law, no party hereto will make any public announcement concerning this Agreement and the transactions contemplated hereby prior to the first mutually agreed upon announcement thereof without the consent of the other party and then only upon the maximum advance notice to the other party which is practicable under the circumstances.

     13.5 Entire Agreement, Amendments, etc. This Agreement, together with the Supplemental Agreement and the other documents being executed by the parties in connection herewith, constitutes the entire understanding and agreement of the parties with respect to the subject matter hereof except as otherwise contemplated in this Agreement or the Supplemental Agreement. No course of prior dealings among all of the parties shall be relevant to supplement or explain any term used in this Agreement. Acceptance and acquiescence in a course of performance rendered under this Agreement shall not be relevant to determine the meaning of this Agreement even though the accepting or the acquiescing party has knowledge of the nature of the performance and an opportunity for objection. All waivers, amendments and modifications of this Agreement must be confirmed in writing and must be approved by the Members in the manner specified in Article XII of this Agreement. No waiver of any terms or conditions of this Agreement in any instance shall operate as a waiver of any other term or condition or as a waiver in any other instance.

     13.6 Construction Principles. As used in this Agreement words in any gender shall be deemed to include all other genders. The singular shall be deemed to include the plural and vice versa. References in this Agreement to K-T, LLC and DNPC include their respective successors and permitted assigns. The captions and Article and Section

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headings in this Agreement are inserted for convenience of reference only and are not intended to have significance for the interpretation of or construction of the provisions of this Agreement. This Agreement has been jointly drafted by the parties, and the parties agree that the provisions of this Agreement are not to be construed more strictly against one party than the other.

     13.7 Counterparts. This Agreement may be executed in two or more counterparts by the parties hereto, each of which when so executed will be an original, but all of which together will constitute one and the same instrument.

     13.8 Severability. If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way. The parties hereto agree to replace any invalid or unenforceable provision with a valid provision which closely approximates the intent and economic effect of the invalid or unenforceable provision.

     13.9 Expenses. Each Member shall bear its own costs (including taxes) for all matters involved in the negotiation, execution and performance of this Agreement and related transactions.

     13.10 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah as applied to transactions taking place wholly within Utah between Utah residents. Any legal action or proceedings against either Member with respect to this Agreement may be brought in the courts of the State

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of Utah in Salt Lake County or in the United States District Court for the District of Utah, as either Member may elect, and both Members agree that such jurisdiction shall be exclusive.

     13.11 Binding Effect. Subject to the provisions of this Agreement relating to transferability, this Agreement shall be binding upon, and inure to the benefit of, the Members and their respective permitted distributees, successors and assigns.

     13.12 Additional Documents and Acts. Each Member agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions, and conditions of this Agreement and of the transactions contemplated hereby.

     13.13 Third Party Beneficiaries. This Agreement is made solely for the benefit of K-T, LLC and DNPC and their permitted successors and assigns and no other person shall have any rights, interest, or claims hereunder or otherwise be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise.

     13.14 Limited Liability Company. The Company was formed as a limited liability company and not as a partnership under the laws of the State of Utah or any other laws; provided, however, that, to the extent permitted by law, the Company will hereafter be treated as a partnership for federal, state and local income tax purposes.

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     13.15 Salt Lake JOA. No provision of this Agreement, and no course of action by KK-T, LLC and/or DNPC prior to the execution of this Agreement, was intended to modify or amend the Salt Lake JOA or to constitute a waiver of any rights or obligations of K-T, LLC or DNPC under the Salt Lake JOA. In the event of any conflict between the provisions of this Agreement and the Salt Lake JOA, the provisions of the Salt Lake JOA shall control.

     IN WITNESS WHEREOF, each Member has duly executed and become a party to this Agreement as of this 1st day of July, 2006.

KEARNS-TRIBUNE, LLC
By:	\s\ Joseph J. Lodovic, IV
	Joseph J. Lodovic, IV
	President
DESERET NEWS PUBLISHING COMPANY
By:	\s\ Jim M. Wall
	Jim M. Wall
	President

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EX-10.21

Exhibit 10.21

Second Amended and Restated Partnership Agreement

For

Texas-New Mexico Newspapers Partnership

A Delaware General Partnership

By and Between

Gannett Texas L.P.

And

Northwest New Mexico Publishing Company

August 2, 2006

TABLE OF CONTENTS

ARTICLE I DEFINITIONS			2
ARTICLE II THE PARTNERSHIP			8
	2.1	Formation	8
	2.2	Name	9
	2.3	Business Purpose	9
	2.4	Registered Office and Agent	9
	2.5	Term	9
	2.6	Principal Place of Business	9
	2.7	The Partners	9
	2.8	Fiscal Year	10
	2.9	Representations and Warranties of the Parties	10
ARTICLE III CAPITAL STRUCTURE AND CONTRIBUTIONS			10
	3.1	Capital Contributions	10
	3.2	No Other Mandatory Capital Contributions	12
	3.3	No Right of Withdrawal	12
	3.4	Loans by Third Parties	13
ARTICLE IV CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES			13
	4.1	Capital Accounts	13
	4.2	Book Allocation	13
	4.3	Tax Allocations	14
ARTICLE V DISTRIBUTIONS			15
	5.1	Distributions	15
ARTICLE VI ACCOUNTING AND REPORTS			16
	6.1	Books and Records	16
	6.2	Reports to Partners	16
	6.3	Annual Tax Returns	17
	6.4	Actions in Event of Audit	18
	6.5	Tax Elections	18
ARTICLE VII ACTIONS BY PARTNERS			18
	7.1	Meetings	18
	7.2	Actions by the Partners	18
ARTICLE VIII MANAGEMENT			19
	8.1	The Management Committee	19
	8.2	Removal of Members; Vacancies	19
	8.3	Meetings of the Management Committee; Notice	20
	8.4	Quorum	20
	8.5	Voting	20
	8.6	Certain Matters Requiring a Unanimous Vote of the Management Committee	20
	8.7	Action by Consent	22
	8.8	Executive Officers	22

i

	8.9	Provision of Services to Partnership by MediaNews	23
	8.10	Partnership Change in Control	25
	8.11	MediaNews Change in Control	25
ARTICLE IX TRANSFER OF PARTNERSHIP INTERESTS; ADDITIONAL AND SUBSTITUTE PARTNERS			28
	9.1	Prohibited Transfers	28
	9.2	Permitted Transfers by Partners	28
	9.3	Substitute Partner	29
	9.4	Involuntary Withdrawal by a Partner	29
	9.5	Right of First Refusal for Sale of Partnership Interests	29
	9.6	Tag-Along Rights Regarding Sales of Partnership Interests	31
	9.7	MediaNews Drag-Along Rights	32
	9.8	Admission of Additional Partners	33
	9.9	Acknowledgment of Pledge of Interests	33
	9.10	Rights of First Refusal with Respect to Certain Assets Offered to the Partners	34
ARTICLE X DISSOLUTION AND LIQUIDATION			34
	10.1	Dissolution	34
	10.2	Election to Continue the Business	36
	10.3	Closing of Affairs	36
ARTICLE XI AMENDMENT TO AGREEMENT			37
ARTICLE XII INDEMNIFICATION			37
	12.1	General	37
	12.2	Indemnification Obligations	37
	12.3	Exclusive Remedy	40
	12.4	Third Party Claims	40
	12.5	Other Indemnification Claims	41
ARTICLE XIII GENERAL PROVISIONS			42
	13.1	Mediation	42
	13.2	Notices	42
	13.3	Confidentiality	43
	13.4	Entire Agreement, Etc	43
	13.5	Construction Principles	43
	13.6	Counterparts	43
	13.7	Severability	44
	13.8	Expenses	44
	13.9	Governing Law and Venue	44
	13.10	Binding Effect	44
	13.11	Additional Documents and Acts	44
	13.12	No Third Party Beneficiary	45
	13.13	Waiver of Jury Trial	45

Exhibit A — Form of Third Amended and Restated Partnership Agreement Pursuant to Section 8.11

ii

SECOND AMENDED AND RESTATED PARTNERSHIP AGREEMENT

FOR

TEXAS-NEW MEXICO NEWSPAPERS PARTNERSHIP

A DELAWARE GENERAL PARTNERSHIP

     THIS SECOND AMENDED AND RESTATED PARTNERSHIP AGREEMENT of Texas-New Mexico Newspapers Partnership, a Delaware general partnership (the “Partnership”) is effective as of the 2nd day of August, 2006 by and among Gannett Texas L.P., a Delaware limited partnership (“Gannett”) and Northwest New Mexico Publishing Company, a Delaware corporation, the successor-in-interest to New Mexico-Texas MediaNews LLC, a Delaware limited liability company (“MediaNews”), and each other individual or business entity who may hereafter be admitted from time to time as a Partner hereunder. Gannett and MediaNews and any other individual and/or business entity subsequently admitted shall be known as and referred to as “Partners” and individually as a “Partner”.

RECITALS

     WHEREAS, the Partnership was formed as a general partnership under the laws of the State of Delaware on March 17, 2003;

     WHEREAS, a Partnership Agreement was entered into by and among Gannett Texas L.P. and New Mexico-Texas MediaNews LLC dated as of March 17, 2003 and was amended and restated by the parties as of March 21, 2003;

     WHEREAS, the Partnership Agreement was further amended and restated pursuant to an Amended and Restated Partnership Agreement dated as of December 25, 2005 (as so amended, the “Amended and Restated Partnership Agreement”);

     WHEREAS, the Partners desire to further amend and restate the Amended and Restated Partnership Agreement as of the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter expressed, the Partners agree as follows:

ARTICLE I
DEFINITIONS

     “Act” means the Delaware Revised Uniform Partnership Act, as amended.

     “Additional Capital Contributions” means any additional Capital Contributions made pursuant to Section 3.1(b) of this Agreement.

     “Additional Contribution Terms” shall have the meaning ascribed to it in Section 3.1(b) of this Agreement.

     “Additional Partner” means any additional person admitted to the Partnership, pursuant to Section 9.8 of this Agreement, but does not include a Substitute Partner.

     “Affiliate” means any person controlled by, controlling, or under common control with the entity in question.

     “Book Value” means, with respect to any asset of the Partnership, the adjusted basis of such asset as of the relevant date for federal income tax purposes, except as follows:

          (i) the initial Book Value of any asset contributed by a Partner to the Partnership shall be the fair market value of such asset;

          (ii) the Book Values of all Partnership assets (including intangible assets such as goodwill) shall be adjusted to equal their respective fair market values as of the following times:

               (A) the acquisition of an additional Interest in the Partnership by any new or existing Partner in exchange for more than a de minimis Capital Contribution;

               (B) the distribution by the Partnership to a Partner of more than a de minimis amount of money or Partnership property as consideration for an Interest in the Partnership; and

               (C) the liquidation of the Partnership within the meaning of Regulation section 1.704-1(b)(2) (iv)(f)(5)(ii);

          (iii) the Book Value of the Partnership assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code section 734(b) or Code section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulation section 1.704-1(b)(2)(iv)(m); and

          (iv) if the Book Value of an asset has been determined or adjusted pursuant to subsection (i), (ii) or (iii) above, such Book Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses and other items allocated pursuant to Section 4.2.

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     The foregoing definition of Book Value is intended to comply with the provisions of Regulation section 1.704—1(b)(2)(iv) and shall be interpreted and applied consistently therewith.

     “Business Day” means any day (other than a day which is a Saturday, Sunday or legal holiday for the United States government).

     “Business Plan” is defined in Section 8.1.

     “Capital Account” means, for each Partner, the capital account maintained by the Partnership for such Partner as described in Section 4.1.

     “Capital Contribution” means the amount of money and the other property (net of any liabilities that the Partnership is considered to assume, or take subject to, pursuant to Code Section 752, except to the extent such liabilities are in fact discharged by the Partners contributing such property) which is contributed by a Partner to the Partnership pursuant to Article III hereof, including Additional Capital Contributions.

     “Capital Expenditure” means all expenditures of a capital nature, including those in relation to the construction of enlargements or additions to any of the assets or facilities owned by the Partnership or York Limited Partnership or for any other acquisitions or improvements thereto of a capital nature, including, without limitation, expenditures for materials, labor, equipment permits, consulting fees, accounting and legal fees, insurance costs, contractors’ fees, and land and easement costs.

     “Chairman” is defined in Section 8.1(a).

     “Chief Executive Officer” is defined in Section 8.8(a).

     “Chief Financial Officer” is defined in Section 8.8(b).

     “CNP” means California Newspapers Partnership, a Delaware general partnership, its successors and assigns.

     “CNP Contribution Date” means the date of the Gannett CNP Contribution.

     “CNP EBITDA” means EBITDA of CNP.

     “CNP Partnership Agreement” means the Partnership Agreement for California Newspapers Partnership, a Delaware general partnership, dated August 2, 2006, by and among West Coast MediaNews LLC, Stephens California Media LLC, The Sun Company of San Bernardino, California, California Newspapers, Inc., Media West SBC, Inc., and Media West-CNI, Inc.

     “Code” means the Internal Revenue Code of 1986, as amended.

     “Contribution Agreement” means those contribution agreements described in Section 3.1 of the Agreement.

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     “Depreciation” means, for each Fiscal Year or part thereof, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such Fiscal Year or part thereof, except that if the Book Value of an asset differs from its adjusted basis for federal income tax purposes, the depreciation, amortization or other cost recovery deduction for such Fiscal Year or part thereof shall be an amount which bears the same ratio to such Book Value as the federal income tax depreciation, amortization or other cost recovery deduction for such Fiscal Year or part thereof bears to such adjusted tax basis. If such asset has a zero adjusted tax basis, the depreciation, amortization or other cost recovery deduction for each Fiscal Year shall be determined under a method reasonably selected by the Tax Matters Partner.

     “Dissolution Committee” means the committee established pursuant to Section 8.11(c) hereof to serve as the liquidator of the Partnership and to manage the dissolution of the Partnership.

     “EBITDA” means, with respect to any entity, the sum of (i) net income after taxes, plus (ii) interest expense that has been deducted in the determination of such net income, plus (iii) federal, state and local income taxes that have been deducted in determining such net income, plus (iv) depreciation and amortization expenses that have been deducted in determining such net income, in each case for the 12-month period ended immediately prior to the date of such determination, and determined on a basis consistent with GAAP, consistently applied.

     “Election Period” means either (i) the Transition Period plus 30 days thereafter, if a MNG Notice is received by Gannett during the Transition Period (and such MNG Notice has not been revoked by MNG), provided that Gannett shall have the right, exercisable in its sole discretion upon notice to the other Partners, to extend the Election Period until a date specified by Gannett occurring at any time during the fiscal year of Gannett Co., Inc. in which the Transition Period expires or the next succeeding fiscal year of Gannett Co., Inc.; or (ii) 30 days following receipt by Gannett of the MNG Notice, if a MNG Notice (which has not been revoked by MNG) is received by Gannett after the expiration of the Transition Period, provided that Gannett shall have the right, exercisable in its sole discretion upon notice to the other Partners, to extend the Election Period until a date specified by Gannett occurring at any time (A) during the fiscal year of Gannett Co., Inc. in which the MNG Notice is received by Gannett, or (B) during the next succeeding fiscal year of Gannett Co., Inc. In the case of either clause (i) or (ii) above, the Election Period shall automatically be extended by one day for each day which elapses during the period commencing on the date of the applicable MNG Notice and continuing until the date of consummation of the transaction referenced in the applicable MNG Notice.

     “Executive Officers” means the following officers of the Partnership: its president, Chief Executive Officer, Chief Financial Officer and any other individual who would be an “executive officer” of the Partnership as determined in accordance with Rule 3b-7 promulgated under the Securities Exchange Act of 1934.

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     “Fair Market Value of the Offered Interest” is defined in Section 9.5(f)(ii).

     “Fiscal Year” means the fiscal year of the Partnership as defined in Section 2.8 hereof.

     “Formation Date” is defined in Section 2.5 of this Agreement.

     “GAAP” means United States generally accepted accounting principles, as in effect from time to time.

     “Gannett” means Gannett Texas L.P., a Delaware limited partnership, its successors and assigns.

     “Gannett Claim Notice” is defined in Section 12.2 of this Agreement.

     “Gannett CNP Contribution” means the contribution of the Gannett CNP Interest to the Partnership pursuant to Section 3.1(e).

     “Gannett CNP EBITDA” means the product of CNP EBITDA multiplied by the percentage interest in CNP represented by the Gannett CNP Interest.

     “Gannett CNP Interest” means the entire beneficial ownership interest of Gannett Co., Inc. and its Affiliates in CNP and its property on the CNP Contribution Date.

     “Gannett Election Notice” means written notice from Gannett to MediaNews of its intention to contribute (or cause to be contributed) the Gannett CNP Interest to the Partnership pursuant to Section 3.1(e), which notice shall specify the date upon which such contribution shall become effective for all purposes of this Agreement.

     “Gannett TNP EBITDA” means the Percentage Interest of Gannett and its Affiliates in the Partnership at the date of determination, multiplied by TNP EBITDA.

     “GANSAT” means Gannett Satellite Information Network, Inc., a Delaware corporation, its successors and assigns.

     “Indebtedness” means those obligations for borrowed money which were assumed by the Partnership as a consequence of, or to which property of the Partnership was subject immediately following the Partner’s initial Capital Contributions (within the meaning of Section 3.1(a) hereof), with the exception of any of the foregoing such obligations which are included in the Working Capital Statements (as defined in the Contribution Agreement).

     “Interest” means, with respect to any Partner at any time, such Partner’s entire beneficial ownership interest in the Partnership and its property at such time, including such Partner’s Capital Account, voting rights (if any), and right to share in Profits and Losses, all items of income, gain, loss, deduction and credit, distributions and all other benefits of the Partnership as specified in this Agreement, together with such Partner’s obligations to comply with all of the terms of this Agreement.

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     “Involuntary Transfer” shall have the meaning ascribed thereto in Section 9.4.

     “Majority” means the Partners having a majority of the Percentage Interests.

     “MediaNews” means Northwest New Mexico Publishing Company, a Delaware corporation, its successors and assigns.

     “MediaNews Change in Control” means the occurrence of any transaction or series of transactions as a result of which (i) MNG and Permitted Holders no longer directly or indirectly hold in the aggregate more than 50% of the voting interests of each of TNP Publishing, LLC, Northwest New Mexico Publishing Company and MediaNews Group Interactive, Inc., their successors and assigns, including any Affiliate which on or after the date hereof holds any Interest in the Partnership, or (ii) the sale or other disposition of all or substantially all of the assets of MNG or any of its Affiliates listed in clause (i) except for sales or other dispositions to MNG or any of its Affiliates and/or Permitted Holders, or (iii) a majority of the voting interests of MNG are acquired by a person or entity (or group of persons and entities acting in concert), whether structured as a merger, consolidation, reorganization, sale of stock or otherwise, other than Permitted Holders, in each case of clauses (i) or (ii), without the prior written consent of Gannett, not to be unreasonably withheld. No such approval shall be deemed to have been withheld unreasonably if the proposed transferee (or those controlling the proposed transferee) does not have experience in and a good reputation within the newspaper publishing industry.

     “MNG” means MediaNews Group, Inc., a Delaware corporation, its successors and assigns.

     “MNG Notice” means notice from MNG of a proposed MediaNews Change in Control pursuant to Section 8.11.

     “Partnership Change in Control” means (i) any occurrence whereby the Percentage Interests directly or indirectly owned by MNG and its Affiliates and Permitted Holders become less than fifty percent (50%) of the total Percentage Interest of all Partners, after giving effect to any reduction in MediaNews’ Percentage Interest occasioned by Gannett’s availing itself of the remedy set forth in Section 12.2 of this Agreement and any additional capital contribution of newspaper assets by MediaNews pursuant to Section 12.2, or (ii) any pledgee, collateral assignee or Transferee (other than MNG and its Affiliates) of all or any portion of the Interest of MNG and its Affiliates, without the prior written consent of Gannett, seeks to be admitted as a Substitute Partner or to exercise any voting rights or other powers granted to MediaNews (including with respect to members of the Management Committee appointed by MediaNews) in this Agreement, or (iii) the occurrence of the Gannett CNP Contribution.

     “Percentage Interest” means, for each Partner, such Partner’s percentage interest as set forth in Section 3.1 hereof as such may be adjusted from time to time in accordance with this Agreement.

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     “Permitted Holders” means (i) each of William Dean Singleton, Richard B. Scudder, Joseph J. Lodovic, IV and their respective spouses, ancestors, siblings, descendants (including children or grandchildren by adoption) and the descendants of any of their siblings; (ii) in the event of the incompetence or death of any of the persons described in clause (i), such person’s estate, executor, administrator, committee or other personal representative, in each case who at any particular date shall beneficially own or have the right to acquire, directly or indirectly, capital stock of MNG; (iii) any trust created for the benefit of the persons described in clause (i) or (ii) or any trust for the benefit of any such trust; or (iv) any person controlled by any of the persons described in clause (i), (ii) or (iii). For purposes of this definition, “control,” as used with respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, whether through ownership of voting securities or by contract or otherwise.

     “Profits” and “Losses” means, for each Fiscal Year or part thereof, the taxable income or loss of the Partnership for such Fiscal Year determined in accordance with Code section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code section 703(a)(1) shall be included in taxable income or loss), with the following adjustments:

          (i) any income of the Partnership that is exempt from federal income tax shall be added to such taxable income or loss;

          (ii) any expenditures of the Partnership described in Code section 705(a)(2)(B) or treated as such pursuant to Regulation section 1.704-1(b)(2)(iv)(i) shall be subtracted from such taxable income or loss;

          (iii) any Depreciation for such Fiscal Year or part thereof shall be taken into account in lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss;

          (iv) gain or loss resulting from any disposition of Partnership property with respect to which gain or loss is recognized for federal income tax purposes shall be computed with reference to the Book Value of the property disposed of, rather than the adjusted tax basis of such property;

          (v) in the event the Book Value of any Partnership asset is adjusted pursuant to section (ii) or (iii) of the definition of Book Value hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such assets for purposes of computing Profits and Losses; and

          (vi) such taxable income or loss shall be deemed not to include any income, gain, loss, deduction or other item thereof allocated pursuant to Section 4.3.

     “Regulations” means the income tax regulations promulgated under the Code by the Department of the Treasury, as such regulations may be amended from time to time.

     “Substitute Partner” means a person who has become a substitute Partner pursuant to Section 9.3 hereof, but does not include an Additional Partner.

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     “Third Amended and Restated Partnership Agreement” means the form of Third Amended and Restated Partnership Agreement of the Partnership referenced in Section 8.11 of this Agreement and attached hereto as Exhibit A.

     “TNP EBITDA” means EBITDA of the Partnership.

     “Transfer” means any sale, assignment, gift, alienation, or other disposition, whether voluntary or by operation of law (other than a transfer which may arise by reason of death or incapacity), of an interest or any portion thereof, but shall not include any pledge, hypothecation or granting of a security interest in such Interest.

     “Transferee” means a purchaser, transferee, assignee (other than any secured party, pledgee or collateral assignee) or any other person who takes, in accordance with the terms of this Agreement, an Interest in the Partnership.

     “Transition Period” means the period commencing on the date of this Agreement and ending on June 30, 2010.

     “York Indemnity Claim” is defined in Section 12.2 of this Agreement.

     “York Joint Operating Agreement” means the Amended and Restated Joint Operating Agreement, dated as of April 30, 2004, by and among York Newspapers, Inc., York Newspapers Holdings, Inc., York Limited Partnership and York Dispatch Publishing Company, LLC.

     “York Limited Partnership Agreement” means the Limited Partnership Agreement, dated as of April 30, 2004, by and among York Newspapers, Inc., York Newspapers Holdings, Inc. and York Dispatch Publishing Company, LLC.

     “York Limited Partnership” means York Newspapers Holdings, L.P., a Delaware limited partnership, its successors and assigns, and its subsidiaries, The York Newspaper Company, a Pennsylvania general partnership, York Newspapers Holdings, LLC, York Dispatch LLC and York Daily Record — York Sunday News LLC, their successors and assigns.

     “York LLC” means York Partnership Holdings LLC, a Delaware limited liability company, its successors and assigns. As of the date hereof, York LLC is a wholly-owned subsidiary of the Partnership and the sole general partner of York Limited Partnership. Northwest New Mexico Publishing Company, successor to Pennsylvania Newspapers Publishing, Inc., is the sole manager of York LLC.

     “York Partnership Interest” has the same meaning as defined in Section 2.5(a) of the Contribution Agreement.

ARTICLE II
THE PARTNERSHIP

     2.1 Formation. The parties hereto have formed a partnership in accordance with the further terms and provisions hereof. Each of the Partners shall execute or cause to be executed from time to time all other instruments, certificates, notices and documents, and shall do or cause to be done all such filing, recording, publishing and other acts, in each case, as may be necessary or appropriate from time to time to

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comply with all applicable requirements for the formation and/or operation and, when appropriate, termination of a partnership in the State of Delaware and all other jurisdictions where the Partnership shall desire to conduct its business.

     2.2 Name. The name of the Partnership shall be “Texas-New Mexico Newspapers Partnership” and its business shall be carried on in this name with such variations and changes as the Management Committee, in its sole judgment, deems necessary or appropriate to comply with the requirements of the jurisdictions in which the Partnership’s operations are conducted.

     2.3 Business Purpose. The purpose of the Partnership is to carry on any lawful business and to engage in any lawful act or activity for which a partnership may be formed under the laws of the State of Delaware; provided, however, that the business of the Partnership shall, without the unanimous consent of the Management Committee, be limited to activities involving the ownership, operation, and publication (in printed and electronic form) of newspapers and related publications and business activities directly related or incidental to such ownership, operation and publication including, without limitation, commercial printing, alternate distribution services and direct mail activities.

     2.4 Registered Office and Agent. The registered office of the Partnership in the State of Delaware and its registered agent for service of process on the Partnership in the State of Delaware shall be as determined by the Management Committee.

     2.5 Term. The term of the Partnership commenced on March 17, 2003 (the “Formation Date”) and shall continue until December 31, 2053 unless earlier dissolved and liquidated in accordance with Article X hereof.

     2.6 Principal Place of Business. The Partnership shall maintain its principal place of business at 1560 Broadway, Suite 2100, Denver, Colorado 80202, or such other location or locations as the Management Committee may from time to time select.

     2.7 The Partners. The name and place of residence of each Partner is as follows:

NAME	RESIDENCE
Gannett Texas L.P.	c/o Gannett Co., Inc.
	7950 Jones Branch Drive
	McLean, VA 22107
Northwest New Mexico Publishing Company	c/o MediaNews Group, Inc,
	1560 Broadway, Suite 2100
	Denver, CO 80202

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     2.8 Fiscal Year. Unless the Tax Matters Partner shall otherwise determine in accordance with Section 706 of the Code, the fiscal year of the Partnership shall end on June 30^th of each calendar year.

     2.9 Representations and Warranties of the Parties. Each of the parties represents and warrants that:

          (a) It is a limited partnership, limited liability company or corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization;

          (b) It has all requisite power and authority to enter into this Agreement; the execution and delivery by such party of this Agreement and the consummation by such party of the transactions contemplated hereby have been duly authorized by all necessary partnership or corporate action on the part of such party; and this Agreement has been duly and validly executed and delivered by such party and constitutes (assuming the due and valid execution and delivery of this Agreement by the other parties), the legal, valid and binding obligation of each party, enforceable against each party in accordance with its terms;

          (d) The execution, delivery and performance by such party of this Agreement will not, as of and after the date of this Agreement, result in a breach of any of the terms, provisions or conditions of any agreement to which such party is a party which has a reasonable likelihood of materially and adversely affecting the operations, properties or business of the Partnership or such party’s obligations under this Agreement; and

          (e) The execution and delivery by such party of this Agreement and the formation of the Partnership does not require any filing by it with, or approval or consent of, any governmental authority which has not already been made.

ARTICLE III
CAPITAL STRUCTURE AND CONTRIBUTIONS

     3.1 Capital Contributions.

          (a) Initial Contributions. Each of Gannett and MediaNews has made (or caused to be made) a Capital Contribution to the Partnership as set forth in a contribution agreement among Gannett, Las Cruces Publishing Company, Northwest New Mexico Publishing Company, Carlsbad Publishing Company, and New Mexico — Texas MediaNews Group Interactive, Inc. and dated as of March 14, 2003 (the “Contribution Agreement”). Each of Gannett and MediaNews has made (or will cause to be made) a Capital Contribution to the Partnership as set forth in a contribution agreement among Gannett, MediaNews, Pennsylvania Newspapers Publishing Inc., MediaNews Group Interactive, Inc., MediaNews Group, Inc., TNP Publishing, LLC and the Partnership and dated as of November 30, 2005 (also, for purposes of this Agreement, the “Contribution Agreement”). As a result of such Capital Contributions, effective as of December 25, 2005, Gannett has (or will have) a Percentage Interest in the Partnership of 40.64%, and MediaNews has (or will have) a Percentage Interest in

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the Partnership of 59.36%. Except as specified in Section 3.1(e), Percentage Interests shall not be adjusted on account of the payment of any sums, or the contribution of any property, treated as a Capital Contribution without the unanimous consent of the Partners.

          (b) Additional Capital Contributions; Interest; and Offset. At any time, and from time to time after the Formation Date (i) the Management Committee, in its sole and absolute discretion, by unanimous vote, or (ii) either the Chief Executive Officer or the Chief Financial Officer, each in his sole and absolute discretion, may determine that the Partnership requires additional capital contributions (the “Additional Capital Contributions”) and the amount, terms and conditions thereof. Such Additional Capital Contributions will be used by the Partnership for such activities as are designated by the Management Committee in its approval resolution, or as are determined by the Chief Executive Officer or the Chief Financial Officer, as the case may be, provided that the Additional Capital Contributions made pursuant to a determination by the Chief Executive Officer or the Chief Financial Officer may only be used by the Partnership to fund Capital Expenditures in accordance with the Business Plan which has been approved by the Management Committee pursuant to Section 8.1. All Additional Capital Contributions will be made by the Partners in proportion to their then-current Percentage Interests in the Partnership. In addition, with the unanimous consent of the Management Committee, Additional Capital Contributions may be obtained by the admittance of Additional Partners in accordance with Section 9.8. In the event Additional Partners are admitted, the Percentage Interests of the existing and Additional Partners shall be adjusted as determined by the Management Committee, voting unanimously. From the date of the Management Committee’s, the Chief Executive Officer’s or the Chief Financial Officers’ determination, as the case may be, that an Additional Capital Contribution is required until it has been paid, a Partner’s obligation to make that contribution shall accrue interest at a rate of 9% per annum until the obligation to make the Additional Capital Contribution (and to pay all accrued but unpaid interest, if any, with respect thereto) has been paid in full. All cash distributions to which such Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such Additional Capital Contribution (and to pay all accrued but unpaid interest, if any, with respect thereto). Any amounts so retained shall be treated as distributed to such Partner and, first paid to the Partnership in the amount of the accrued interest and, second, with respect to the remainder thereof, contributed to the Partnership as an Additional Capital Contribution on behalf of the Partner owing such obligation.

          (c) Capital Contributions Required Under Section 12.2; Interest; and Offset. As provided in Section 12.2 of this Agreement, any Partner owing an indemnification obligation to the Partnership arising under Article XII of this Agreement shall make a capital contribution in cash or other immediately available funds in the amount of such obligation promptly upon the determination of such obligation. Furthermore, from the date of the determination of such obligation until the date such capital contribution is made in cash or other immediately available funds, the amount of such obligation shall accrue interest owing to the Partnership at a rate of 9 per cent per annum, and until such obligation (and all accrued interest, if any, with respect thereto)

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has been paid in full in cash or other immediately available funds, all cash distributions to which a Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such capital contribution and to pay accrued but unpaid interest. Any amounts so retained shall be treated as distributed to such Partner and, first paid to the Partnership in the amount of the accrued interest and, second, with respect to the remainder thereof, contributed to the Partnership as an additional capital contribution on behalf of the Partner owing such obligation.

          (d) Other Contributions. At any time during the term of this Agreement, any Partner may offer to contribute to the Partnership as an additional capital contribution any newspapers, mastheads or related assets owned by it that are located in the State of Texas, the State of New Mexico or the Commonwealth of Pennsylvania. Should the Management Committee, by a unanimous vote, agree to accept such contribution, the Capital Account and, if determined by unanimous vote of the Management Committee, as provided in Section 8.6 hereof, the Percentage Interest, of the contributing Partner will be adjusted upward to reflect the fair market value of such contribution (determined in accordance with the procedures set forth in Section 9.5(f)) and, if determined by unanimous vote of the Management Committee, as provided in Section 8.6 hereof, the Percentage Interest of the other Partners will be adjusted downward proportionately to reflect the increase in the contributing Partner’s Percentage Interest.

          (e) Contribution of Gannett CNP Interest; Increase of Percentage Interest. Following receipt of any MNG Notice by Gannett, and during the Election Period, Gannett shall have the right (but not the obligation) to elect to contribute (or cause to be contributed) all of the Gannett CNP Interest to the Partnership, without obtaining the consent of the Partnership or any other Partner, by sending the Gannett Election Notice in accordance with Section 13.2. Any such contribution to the Partnership shall become effective upon the closing date during the Election Period specified by Gannett in the Gannett Election Notice, and the Partnership shall be admitted as a substitute partner of CNP on such closing date; provided, however, that such contribution shall not become effective unless and until the consummation of the proposed MediaNews Change in Control referenced in the MNG Notice. Effective as of the CNP Contribution Date, Gannett and its Affiliates’ Percentage Interest will be increased to the quotient (expressed as a percentage) of (i) the sum of Gannett CNP EBITDA, plus Gannett TNP EBITDA, divided by (ii) the sum of TNP EBITDA plus Gannett CNP EBITDA.

     3.2 No Other Mandatory Capital Contributions. Except as specified in Section 3.1(b), Section 3.1(c) or Section 12.2, no Partner shall be obligated to make any Additional Capital Contribution to the Partnership’s capital.

     3.3 No Right of Withdrawal. No Partner shall have the right to withdraw any portion of such Partner’s Capital Contributions to, or to receive any distributions from, the Partnership, except as provided in Articles V, IX and X hereof.

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     3.4 Loans by Third Parties. Subject to the provisions of Section 8.6 hereof, the Partnership may borrow funds or enter into other similar credit, guarantee, financing or refinancing arrangements for any purpose from any Partner or from any person upon such terms as the Management Committee determines, in its sole and absolute discretion, are appropriate.

ARTICLE IV
CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES

     4.1 Capital Accounts. Each Partner shall have a capital account (a “Capital Account”) which account shall be (1) increased by the amount of (a) the Capital Contributions of such Partner, (b) the allocations to such Partner of Profits and items of income or gain pursuant to Section 4.2, and (c) any positive adjustment to such Capital Account by reason of an adjustment to the Book Value of Partnership assets, and (2) decreased by the amount of (x) any cash and the Book Value of any property (net of liabilities secured by such property that such Partner is considered to assume or take subject to under Code section 752) distributed to such Partner, (y) the allocation to such Partner of Losses and items of loss pursuant to Section 4.2, and (z) any negative adjustment to such Capital Account by reason of an adjustment to the Book Value of Partnership assets. In the event of a revaluation of the Book Value of Partnership assets, the Partners’ Capital Accounts shall be adjusted in the same manner as if gain or loss had been recognized on a sale of the assets at their new Book Value. The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulation section 1.704-1(b), and shall be interpreted and applied in a manner consistent with such Regulation.

     4.2 Book Allocation.

          (a) In General. This Section 4.2 sets forth the general rules for book allocations of Profits, Losses and similar items to the Partners as reflected in their Capital Accounts.

          (b) Profits and Losses. Profits shall be allocated to the Partners in proportion to their Percentage Interests. Losses shall be allocated to the Partners in proportion to their Percentage Interests except that any interest expense or other deduction attributable to any Indebtedness (other than any depreciation or amortization deductions attributable to property which is contributed to the Partnership subject to such Indebtedness) and any deductions attributable to any indemnity payments described in Section 12.2 shall be allocated to the Partner that contributed property subject to such Indebtedness or such indemnity payment.

          (c) Special Rules.

               (i) Notwithstanding the general allocation rules set forth in Section 4.2(b), in the case of any deduction allocable to a “nonrecourse liability” (as that term is defined in Regulations Section 1.704-2(b)(3)) and any deduction allocable to a “partner nonrecourse liability” (as that term is defined in Regulations Section 1.704-2(b)(4)), and any minimum gain or partner minimum gain chargeback with respect

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thereto, shall be subject to the rules applicable thereto and described in Regulations Section 1.704-2.

               (ii) If in the opinion of independent tax counsel for the Partnership, it is necessary to provide special allocation rules in order to avoid a significant risk that a material portion of any allocation set forth in this Article IV would not be respected for federal income tax purposes, the Partners shall negotiate in good faith any amendments to this Agreement as, in the opinion of such counsel, are necessary or desirable, taking into account the interests of the Partners as a whole and all other relevant factors, to avoid or reduce significantly such risk to the extent possible without materially changing the amounts allocable and distributable to any Partner pursuant to this Agreement.

               (iii) If there is a change made, by unanimous vote of the Management Committee in accordance with the provisions of Section 8.6 hereof, in any Partner’s share of the Profits, Losses or other items of the Partnership during any Fiscal Year, allocations among the Partners shall be made in accordance with their interests in the Partnership from time to time during such Fiscal Year in accordance with Code section 706, using the closing-of-the-books method, except that Depreciation with respect to assets not contributed by a Partner shall be deemed to accrue ratably on a daily basis over the entire Fiscal Year during which the corresponding asset is owned by the Partnership.

               (iv) Except as otherwise provided in Sections 4.2(b) and 4.3(b)(i), each item of income, gain, loss, and deduction and all items governed by Code section 702(a) shall be allocated among the Partners in proportion to the allocation of Profits, Losses and other items to the Partners hereunder, provided that to the extent any gain recognized from any disposition of a Partnership asset is treated as ordinary income because it is attributable to the recapture of any depreciation or amortization, such ordinary income shall be allocated among the Partners in the same ratio as the prior allocations of Profits, Losses or other items that included such depreciation or amortization; in no event, however, shall any Partner be allocated ordinary income hereunder in excess of the gain otherwise allocable to each Partner.

     4.3 Tax Allocations.

          (a) In General. Except as set forth in Section 4.3(b), allocations for tax purposes of items of Profit, Loss and other items of income, gain, loss, deduction, credit and distribution therefor, shall be made in the same manner as allocations for book purposes set forth in Section 4.2. All such allocations pursuant to Section 4.3(b) shall be considered made solely for purposes of federal, state and local income taxes, and shall not affect or in any way be taken into account in computing any Partner’s Capital Account or share of Profits, Losses, other items or gain, deduction and distribution pursuant to any provision of this Agreement.

          (b) Special Rules.

               (i) Elimination of Book/Tax Disparities. In determining a Partner’s allocable share of Partnership taxable income, the Partner’s allocable share of each item of Profits and Losses shall be properly adjusted to reflect the difference

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between such Partner’s share of the adjusted tax basis and the Book Value of Partnership assets used in determining such item under any method adopted by the Tax Matters Partner and allowable under Code Section 704(c), provided, however, that any deductions for depreciation or amortization attributable to property contributed to the Partnership by a Partner shall be allocated to the Partner contributing such property (and, from and after the CNP Contribution Date, any similar allocations made by CNP to the Partnership pursuant to the parenthetical in Section 4.3(b)(i) of the CNP Partnership Agreement shall be allocated to Gannett and its Affiliates). In the event that the method for the allocation of depreciation or amortization deductions attributable to contributed property described in the previous sentence is disallowed, then the Tax Matters Partner shall make such compensating allocations of items including (notwithstanding the second sentence of Section 4.3(a)) such book allocations as are intended to accomplish the same economic result.

               (ii) Tax Credits. Any tax credits shall be allocated among the Partners in accordance with Regulation section 1.704-1(b)(4)(ii), unless the applicable Code provision shall otherwise require.

          (c) Conformity of Reporting. The Partners are aware of the income tax consequences of the allocations made or to be made pursuant to this Article 4 and Section 6.5 and hereby agree to be bound by the provisions of this Article 4 and Section 6.5 in reporting their shares of Partnership profits, gains, income, losses, deductions, credits and other items for income tax purposes.

ARTICLE V
DISTRIBUTIONS

     5.1 Distributions.

          (a) The Management Committee (or, at the Management Committee’s direction, the Executive Officers of the Partnership), on or before the last day of each accounting period shall, in its or their sole discretion, determine the amount of earnings (before depreciation and amortization) or other Partnership funds available for distribution to Partners (whether as a distribution of earnings or as loans or advances) and shall cause that amount to be distributed to the Partners (subject to the provisions of Sections 3.1(b) and 3.1(c) hereof relating to the Partnership’s retention of sums otherwise distributable to a Partner to discharge the obligation to make certain capital contributions and pay certain accrued but unpaid interest). Except as otherwise provided herein, all distributions shall be made in proportion to the Partners’ Percentage Interests. For the purposes of this Section 5.1(a), any payment of principal or interest by the Partnership with respect to Indebtedness shall be treated as distributed by the Partnership to the Partner that transferred the property to the Partnership to which such Indebtedness relates, and then as contributed to the Partnership by such Partner as an Additional Capital Contribution.

          (b) If a distribution of cash is deemed made pursuant to Section 3.1(b), Section 3.1(c) or the last sentence of Section 5.1(a) and, the distribution is not in proportion to the Partner’s Percentage Interest, then the Management Committee shall

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adjust subsequent distributions so that the cumulative distributions deemed made pursuant to Section 3.1(b), Section 3.1(c), the last sentence of Section 5.1(a) and this Section 5.1(b) are, in the aggregate, in proportion to the Partners’ Percentage Interests.

ARTICLE VI
ACCOUNTING AND REPORTS

     6.1 Books and Records.

          (a) The Partnership shall maintain or cause to be maintained at an office of the Partnership this Agreement and all amendments thereto and full and accurate books of the Partnership showing all receipts and expenditures, assets and liabilities, Profits and Losses, and all other books, records and information required by the Act as necessary for recording the Partnership’s business and affairs. The Partnership’s books and records shall be maintained in accordance with GAAP except to the extent otherwise provided hereunder for purposes of maintaining Capital Accounts in accordance with Article IV hereof and calculating the Profits or Losses charged or credited thereto. Such documents, books and records shall be maintained at such office or such designated successor office until the expiration of any applicable statutes of limitations for bringing a claim in relation to such documents, books and records.

          (b) Each Partner shall have the right at reasonable times during usual business hours to inspect the facilities of the Partnership, to observe the Partnership’s operations and to examine, audit and make copies of the books of account and other books and records of the Partnership and other books and records relating to the reserves, assets, liabilities and expenses of the Partnership and expenditures by the Management Committee on behalf of the Partnership; provided, however, that none of the foregoing activities shall be conducted in a manner that unreasonably interferes with the Partnership’s operations or business or the Management Committee’ management thereof. Such right may be exercised through any agent or employee of a Partner designated in writing by it or by an independent public accountant, engineer, attorney or other consultant so designated. The Partner making the request shall bear all expenses incurred in any inspection, audit or examination made at such Partner’s behest. Should any inspection, audit or examination disclose any errors or improper charges, the Management Committee shall make, or cause to be made, appropriate adjustments therefor.

     6.2 Reports to Partners.

          (a) As soon as practicable and in any event within thirty (30) days after the end of each accounting period, the Tax Matters Partner shall cause to be prepared and sent to each Partner unaudited statements of income, cash flow and changes in retained earnings and Partners’ equity, for the accounting period in question and from the beginning of such Fiscal Year to the end of such accounting period and an unaudited balance sheet as of the close of such accounting period, all of which shall (i) be prepared in accordance with GAAP (except that certain footnotes may be omitted)

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and (ii) set forth in each case in comparative form the figures for the same accounting period for the previous Fiscal Year.

          (b) As requested, the Tax Matters Partner shall provide to each Partner such information as may be necessary for them to comply with applicable financial reporting requirements of any competent governmental authorities or agencies or stock exchange on which the securities of any such Partner are listed including, without limitation, the U.S. Securities and Exchange Commission and such information regarding the financial position, business, properties or affairs of the Partnership as a Partner may reasonably request.

          (c) At the end of each accounting period and at the end of each Fiscal Year, the Tax Matters Partner shall prepare or cause to be prepared and sent to each Partner reports of advertising lineage, preprint distribution, circulation, cost and other statistical data in relation to the Partnership’s business during the relevant period.

     6.3 Annual Tax Returns.

          (a) Subject to Section 8.10 hereof, effective as of December 25, 2005, MediaNews was designated the “Tax Matters Partner” for income tax purposes pursuant to Section 6231 of the Code (or any corresponding provision of state or local law) with respect to all taxable years of the Partnership and is authorized to do whatever is necessary to qualify as such. Subject to Section 8.10 hereof, if MediaNews is no longer a Partner or has resigned as the Tax Matters Partner, the Tax Matters Partner shall be any Partner designated as such by a unanimous vote of the Partners, and in the absence of a unanimous vote, as shall be determined under applicable provisions of the Code and/or Regulations. The Tax Matters Partner shall, as soon as practicable under the circumstances, inform each Partner of all tax-related matters that are, or have the reasonable potential to become, material to the Partnership that come to its attention in its capacity as Tax Matters Partner.

          (b) The Tax Matters Partner shall prepare or cause to be prepared all tax returns required of the Partnership. As soon as practicable after the end of each Fiscal Year, the Tax Matters Partner shall furnish to each Partner such information in the possession of the Tax Matters Partner requested by such Partner as necessary to timely fulfill such Partner’s federal, state, local and foreign tax obligations, including Form K-1, or any similar form as may be required by the Code or the Internal Revenue Service (the “IRS”) or, to the extent any such information is not in the Tax Matters Partner’s possession, the Tax Matters Partner shall take all reasonable steps necessary to have such information provided to the requesting Partner. No later than forty-five (45) business days prior to filing with the IRS, the Tax Matters Partner shall deliver to each Partner for its review a complete copy of the federal income tax return proposed to be filed by the Partnership. The Tax Matters Partner shall consider in good faith, consistent with Section 6.3(c) hereof, any comments of the Partners with respect to such return made within thirty (30) business days of sending the copy of such return. The Partners shall file their individual or corporate returns in a manner consistent with the Partnership tax and information returns.

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          (c) The Tax Matters Partner shall, consistent with the Business Plan, use its best efforts to do all acts and take whatever steps are required to maximize, in the aggregate, the federal, state and local income tax advantages available to the Partnership and shall defend all tax audits and litigation with respect thereto. The Tax Matters Partner shall maintain the books, records and tax returns of the Partnership in a manner consistent with the acts, elections and steps taken by the Partnership.

     6.4 Actions in Event of Audit. If an audit of any of the Partnership’s tax returns shall occur, each Partner shall, at the expense of the Partnership, participate in the audit. No Partner may contest, settle or otherwise compromise assertions of the auditing agent which may be adverse to the Partnership or any Partner without the approval of a unanimous Management Committee. The Management Committee may, if it determines that the retention of accountants or other professionals would be in the best interests of the Partnership, retain such accountants or other professionals, to assist in any such audits. The Partnership shall indemnify and reimburse the Management Committee for all expenses, including legal and accounting fees, claims, liabilities, losses, and damages to the extent borne by the Management Committee, incurred in connection with any administrative or judicial proceeding with respect to any audit of the Partnership’s tax returns. The payment of all such expenses to which this indemnification applies shall be made before any distributions are made to the Partners under Article V hereof. Neither the Tax Matters Partner, nor any other person shall have any obligation to provide funds for such purpose. The taking of any action and the incurring of any expense by the Management Committee in connection with any such proceeding, except to the extent required by law, is a matter in the sole discretion of the Management Committee.

     6.5 Tax Elections. The Tax Matters Partner shall, in its reasonable discretion, determine (x) whether or not to cause the Partnership to file an election under Code section 754 and the Regulations thereunder and a corresponding election under the applicable section of state and local law, (y) which method to apply to any asset of the Partnership under Section 704(c) of the Code consistent with Section 4.3(b) hereof and whether or not to make any other elections provided for under related state and local laws, and (z) any other tax elections.

ARTICLE VII
ACTIONS BY PARTNERS

     7.1 Meetings. Meetings of the Partners shall be held at the place and time designated from time to time unanimously by the Partners. The Partners may take action by the vote of Partners at a meeting in person or by proxy, or without a meeting by written consent. In no instance where action is authorized by written consent need a meeting of Partners be called or noticed.

     7.2 Actions by the Partners. All actions required or permitted to be taken by the Partners with respect to the Partnership require the vote or consent of all of the Partners.

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ARTICLE VIII
MANAGEMENT

     8.1 The Management Committee. The business and affairs of the Partnership shall be managed under the direction and authority of a Management Committee. On or before July 31, 2003, the Management Committee adopted an initial business plan for the Partnership, and thereafter the Management Committee shall annually adopt a business plan (such initial or subsequent business plan, the “Business Plan”).

          (a) Number, Appointment and Term of Managers. The Management Committee shall be comprised of five (5) members. Subject to Section 8.10 hereof, three (3) members shall be appointed by MediaNews and two (2) members shall be appointed by Gannett. The managers shall act solely as the agents of the Partners appointing them. Each manager shall serve at the pleasure of the Partner appointing him and until his successor has been duly appointed, or until his resignation or removal. In addition, the Chief Executive Officer shall be entitled to attend all meetings and participate in all discussions of the Management Committee except as to matters regarding the Chief Executive Officer or as otherwise determined by the Management Committee. Each Partner shall also be entitled to designate two non-voting observers to attend and participate in all meetings of the Management Committee. So long as William Dean Singleton is CEO of MediaNews Group, Inc., MediaNews shall elect a chairman of the Management Committee (“Chairman”) who shall have the responsibility for convening and chairing the meetings of the Management Committee. The Chairman may, but need not be, one of the members appointed by MediaNews to the Management Committee, provided however that when acting in his capacity as Chairman he shall not be counted for the purposes of constituting a quorum, nor shall he have any voting rights on matters brought before the Management Committee. If a Chairman has not been elected by MediaNews or in the absence or unavailability of the Chairman, the member who requested the meeting shall convene and chair the meeting. If Mr. Singleton is no longer serving as CEO of MediaNews Group, Inc., a Chairman may be appointed by at least three (3) members of the Management Committee.

          (b) Duties and Powers. The Management Committee may exercise all such powers of the Partnership and do all such lawful acts and things as are not directed or required to be exercised or done by the Partners. Each member of the Management Committee may delegate to a representative by written proxy the right to act on behalf of the member in any respect, including without limitation the right to attend meetings or telephone conferences, to represent that Partner’s appointed member for the purposes of constituting a quorum at a meeting, and to vote upon resolutions with or without a meeting.

     8.2 Removal of Members; Vacancies. A member of the Management Committee may be removed at any time, with or without cause, by the Partner (or Partners) who appointed such member. Any vacancy on the Management Committee resulting from removal, resignation, death or incapacity shall be filled by the Partner (or Partners) who is entitled to appoint such member.

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     8.3 Meetings of the Management Committee; Notice. The Management Committee shall meet in regular meetings held at least quarterly at such time and place as may from time to time be determined by the Management Committee either in person or by telephone. Special meetings of the Management Committee may be called by any member. Written notice of regular and special meetings of the Management Committee, stating the place, date and hour of the meeting shall be delivered to each member together with a reasonably detailed agenda for such meeting not less than five Business Days before the date of the meeting, provided, that the foregoing notice requirement may be waived by the Management Committee with respect to any meeting at which at least three (3) members of the Management Committee (including at least one (1) member appointed by Gannett and at least one (1) member appointed by MediaNews) vote for waiver of notice. Notice may be delivered to members in person, by telephone, facsimile, electronic mail or other means of telecommunication.

     8.4 Quorum. Three (3) members of the Management Committee shall constitute a quorum for the transaction of all such business as shall have been set forth with reasonable specificity in the agenda accompanying the notice for such meeting, either in person or by telephone provided that such three (3) (or more) members who are in attendance at such meeting include at least one (1) member appointed by Gannett and at least one (1) member appointed by MediaNews. For the transaction of all other business at a regular or special meeting of the Management Committee, three (3) members of the Management Committee, whether present in person or by telephone, shall again constitute a quorum, provided that such three (3) or more members who are in attendance include at least one (1) member appointed by Gannett and at least one (1) member appointed by MediaNews.

     8.5 Voting. Any matter brought before the Management Committee shall be decided by a majority of members present, except for matters that require a unanimous vote of the Management Committee as provided in this Agreement or as otherwise provided under the laws of the State of Delaware.

     8.6 Certain Matters Requiring a Unanimous Vote of the Management Committee. The Partnership shall not, and Northwest New Mexico Publishing Company (successor to Pennsylvania Newspapers Publishing Inc.) shall cause York Limited Partnership not to, without a unanimous vote of all five (5) members of the Management Committee:

          (a) admit any new Partners to the Partnership or admit any new partners to York Limited Partnership;

          (b) sell, lease, transfer or otherwise dispose of (other than pro rata to the Partners), other than in the ordinary course of business, any assets, property and goodwill of any newspaper or related publication owned by the Partnership or by York Limited Partnership;

          (c) except for distributions to Partners pursuant to Section 5.1 which may be deemed to be advances, commit or cause the Partnership or York Limited Partnership to invest in or purchase the securities of, or any interests of, any person

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except short-term investments in U.S. Government securities, federally-insured certificates of deposit, repurchase agreements for such securities, or commercial paper rated A-1 or better by Standard and Poor’s or P-1 or better by Moody’s or its equivalent by a nationally recognized statistical rating organization;

          (d) commit or cause the Partnership or York Limited Partnership to acquire all or substantially all of the capital stock or all or substantially all of the assets of any person or business deemed to be material or outside of the ordinary course of business;

          (e) except as provided in Section 3.1(b) or Section 12.2 hereof, obligate the Partners to make any Additional Capital Contribution or, except as provided in Section 3.1(e), adjust any Partner’s Percentage Interest;

          (f) cause the Partnership or York Limited Partnership to create, or enter into, any corporation, partnership, limited liability company, joint venture, association, trust or other business entity or to merge or consolidate with any person;

          (g) except as provided in Section 8.9 hereof, commit or cause the Partnership or York Limited Partnership to enter into any contract, agreement, understanding or transaction (i) with any person, that is other than in the ordinary course of the Partnership’s business, (ii) with a Partner or an affiliate of any Partner, which would have the result of imposing terms or conditions on the Partnership or York Limited Partnership that are more onerous or less advantageous to the Partnership or York Limited Partnership than those customarily provided by such Affiliate to its affiliates or (iii) with a Partner or an Affiliate of any Partner that either involves goods, services or properties of a value of more than $350,000 in the aggregate over the entire term of such contract, agreement, understanding or transaction, or does not reflect standard and customary commercial terms;

          (h) accept the contribution of any additional newspapers or related assets from any Partner as an Additional Capital Contribution under the provisions of Section 3.1(c) hereof;

          (i) commit or cause the Partnership or York Limited Partnership (i) to borrow any funds outside of the ordinary course of business; (ii) to enter into any capitalized lease agreements, which are material or outside of the ordinary course of business, except for refinancings or extensions of any existing indebtedness of the Partnership or York Limited Partnership (including, without limitation, the Indebtedness), (iii) to enter into any hedge agreement, or (iv) to guarantee the indebtedness of any other person or entity;

          (j) make any Capital Expenditures materially in excess of the amounts provided in the Business Plan for such expenditures or which are not in the ordinary course of business;

          (k) except as permitted pursuant to Section 8.11 or Article X hereof, dissolve or liquidate the Partnership or York Limited Partnership;

          (l) make any material change to the nature of the Partnership’s business as described in Section 2.3 or make any material change to the nature of the business of York Limited Partnership as conducted as of December 25, 2005;

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          (m) adopt any portion of the Business Plan which would, of itself, require a unanimous vote of the Management Committee;

          (n) amend, terminate or change in any material respect the Partnership’s existing business relationships at its Texas and New Mexico newspapers with Career Builder or Classified Ventures;

          (o) pledge, assign, hypothecate or grant any security interest in, or with respect to, all or any portion of the York Partnership Interest or any material assets of the York Partnership’s Newspapers or the Partnership; or

          (p) amend or waive any provision of this Agreement, the York Joint Operating Agreement or the York Limited Partnership Agreement (the parties understand and agree, however, that the grant of any such consent or approval with respect to any proposed amendment shall in no way waive or modify any rights of the Partnership or Gannett under the Contribution Agreement).

     Notwithstanding any provision of this Agreement to the contrary, from and after the CNP Contribution Date, Gannett shall have exclusive voting, consent and approval rights, which rights may be exercised by Gannett in its sole discretion, with respect to the Gannett CNP Interest contributed to the Partnership.

     8.7 Action by Consent. Any action required or permitted to be taken on behalf of the Partnership at any meeting of the Management Committee may be taken without a meeting by written consent signed by the number of members of the Management Committee required to approve such action, provided that such members include at least one member appointed by each of the Partners.

     8.8 Executive Officers.

          (a) The Management Committee shall elect a chief executive officer of the Partnership (the “Chief Executive Officer”) who shall have the responsibility for managing the day-to-day business operations and affairs of the Partnership and supervising its other officers, subject to the direction, supervision and control of the Management Committee and the Partners. In general, the Chief Executive Officer shall have such other powers and perform such other duties as usually pertain to the office of a chief executive officer, and as from time to time may be assigned to him by the Management Committee, including, without limitation, the authority to retain and terminate employees of the Partnership. The powers and duties of the Chief Executive Officer shall at all times be subject to the provisions of this Agreement.

          (b) The Management Committee shall also elect a chief financial officer of the Partnership (the “Chief Financial Officer”) who shall have the responsibility for managing the Partnership’s financial affairs and books of account, subject to the direction of the Management Committee, the Chief Executive Officer, and the Partners. In general, the Chief Financial Officer shall have such other powers and perform such other duties as usually pertain to the office of a chief financial officer, and as from time to time may be assigned to him by the Management Committee. The powers and duties of the Chief Financial Officer shall at all times be subject to the provisions of this Agreement.

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          (c) The Management Committee may in its discretion also elect from time to time such other Executive Officers as it may determine, each of whom shall have such powers and perform such duties as usually pertain to such offices and as from time to time may be assigned to such persons by the Management Committee. The powers and duties of each Executive Officer shall be subject to the provisions of this Agreement.

          (d) Subject to Section 8.10 hereof, both the Partnership’s Chief Executive Officer and the Chief Financial Officer shall be employees of MediaNews.

          (e) Subject to the provisions of this Agreement and to the directives and policies of the Management Committee, the Chief Executive Officer, the Chief Financial Officer and the other officers of the Partnership shall have the power, acting individually or jointly, to represent and bind the Partnership in all matters, in accordance with the scope of their respective duties subject to Section 8.6 hereof and any other limitations imposed by the Management Committee.

     8.9 Provision of Services to Partnership by MediaNews.

          (a) The Partners hereby agree that the Partnership shall obtain management services, operating, administrative, accounting, electronic media and/or other support services, newsprint purchase services, financial reporting services, human resource services, employee benefit plans and services, risk management services, tax reporting and tax return preparation services and other similar services which MediaNews Group, Inc., a Delaware corporation (“MNG”) provides to its own operating affiliates (collectively, the “MediaNews Support Services”) from MNG. However, Gannett Satellite Information Network, Inc., a Delaware corporation and the general partner of Gannett (“GANSAT”) shall, unless the Partnership requests otherwise, continue to provide newsprint purchase services to the Partnership’s newspapers located in Texas and New Mexico. Newsprint purchased for the Partnership by GANSAT shall be provided at GANSAT’s cost, including all vendor discounts related to newsprint purchased by the Partnership. Newsprint purchased for the Partnership by MNG shall be provided at MNG’s cost, including all vendor discounts related to newsprint purchased by the Partnership.

          (b) In exchange for these MediaNews Support Services, the Partnership shall pay MNG a management fee of $75,000 per annum, payable each year in advance commencing as of January 1, 2006, with an automatic 3% increase for each successive year that MNG provides the MediaNews Support Services. MNG shall begin providing the MediaNews Support Services after the closing of the transactions contemplated by the Contribution Agreement (as defined therein); provided that GANSAT will continue to provide equivalent support services to the Partnership’s newspapers located in Texas, New Mexico and Chambersburg, Pennsylvania for a limited period of time pursuant to a transitional services agreement in such form as shall be reasonably acceptable to Gannett and MediaNews (the “Transitional Services Agreement”). For periods on and after December 25, 2005, Partnership employees shall participate in defined contribution retirement, welfare and other employee benefit plans made available by MNG (the “New Plans”), and, as of December 25, 2005, Partnership employees shall cease active participation in employee benefit plans made

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available through Gannett (the “Gannett Plans”) (except as otherwise provided in the Transitional Services Agreement). Gannett shall be entitled to charge the Partnership for its allocated cost for the coverage provided under the Gannett Plans through December 25, 2005, which costs shall be reflected on the Final Partnership Working Capital Statement, or, for periods after December 25, 2005, as set forth in the Transitional Services Agreement, in accordance with past practice. Additionally, on an ongoing basis for periods after December 25, 2005, Gannett shall be entitled to charge the Partnership, in accordance with past practice, for the Partnership’s portion of the cost for retiree medical or life insurance for those former Partnership employees receiving retiree medical or life insurance benefits as of December 25, 2005 under Gannett’s retiree medical or life insurance plans (no individual who is employed by the Partnership on or after December 25, 2005 shall be entitled to receive benefits under Gannett’s retiree medical or life insurance plans). From and after December 25, 2005 (or such later date set forth in the Transitional Services Agreement), Gannett shall be solely responsible for, and without charge to the Partnership, continuing to provide long-term disability benefits and workers’ compensation benefits to Partnership employees who are entitled to such benefits under Gannett’s plans as of December 25, 2005. As of December 25, 2005 (or such later date set forth in the Transitional Services Agreement), the New Plans shall provide short-term disability benefits to Partnership employees receiving such benefits as of such date and shall provide the coverage required by Section 4980B of the Code and Part 6 of Subtitle B of Title I of ERISA to individuals who are entitled to or receiving such coverage as of such date by virtue of being, or their connection with, a current or former Partnership employee. Except as set forth in this Section, Gannett shall be solely responsible and liable for providing all benefits accrued under the Gannett Plans. For purposes of the New Plans, (A) each Partnership employee shall be immediately eligible to participate, without any waiting period, in any and all New Plans to the extent coverage under such New Plan is comparable to a Gannett Plan or compensation arrangements or agreements in which such Partnership employee participated immediately before December 25, 2005; and (B) for purposes of each New Plan providing medical, dental, pharmaceutical and/or vision benefits to any Partnership employee, MNG shall cause all pre-existing condition exclusions and actively-at-work requirements of such New Plan to be waived for such employee and his or her covered dependents, and MNG shall cause any eligible expenses incurred by such employee and his or her covered dependents during the portion of the plan year of the Gannett Plan ending on the date such employee’s participation in the corresponding New Plan begins to be taken into account under such New Plan for purposes of satisfying all deductible, coinsurance and maximum out-of-pocket requirements applicable to such employee and his or her covered dependents for the applicable plan year as if such amounts had been paid in accordance with such New Plan. Additionally, MNG shall credit Partnership employees with their service with Gannett or its affiliates for purposes of eligibility to participate, vesting and determining such employees’ entitlement to a level of benefits (but not for purposes of benefit accrual) under all employee plans, programs or arrangements made available by MNG to Partnership employees after December 25, 2005. All services and supplies, including employee benefits, shall be provided to the Partnership at cost without any

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administrative charge, allocation of internal expenses or adjustment for overhead or any other direct or indirect payment to MNG or GANSAT, or their affiliates.

          (c) MNG, by agreeing to provide management services, agrees to perform those services with the degree of care that a reasonably prudent person would exercise and shall not enter into any transaction in which it may have a conflict of interest without the unanimous consent of the members of the Management Committee. If MNG should at anytime, due to bankruptcy, insolvency or similar incapacity, become unable to continue to provide such services on behalf of the Partnership, the Partners shall, by mutual agreement, make appropriate arrangements for the provision of such services by one or more of the other Partners or their Affiliates, or by one or more third parties.

     8.10 Partnership Change in Control. In the event of a Partnership Change in Control, Gannett shall have the right, exercisable in its sole discretion from time to time by giving not less than two (2) Business Days prior written notice to MediaNews at any time following a Partnership Change in Control, to cause some or all of the following changes to occur, which change(s) shall be effective from and after the effective date (the “Effective Date”) of the change specified in any such notice: (i) Gannett shall have the right to appoint three (3) of the five (5) members of the Management Committee and MediaNews shall have the right to appoint two (2) members of the Management Committee and, if Gannett exercises such right, the members serving on the Management Committee immediately prior to the Effective Date shall be deemed to have been removed by the Partners who appointed them as of the Effective Date; (ii) Gannett shall have the right to appoint a replacement Chief Executive Officer and/or Chief Financial Officer of the Partnership who shall be an employee of Gannett and terminate the then-current Chief Executive Officer and/or Chief Financial Officer on behalf of the Partnership; (iii) Gannett shall have the right to be designated the Tax Matters Partner of the Partnership and, if Gannett exercises such right, MediaNews shall no longer serve as the Tax Matters Partner; and (iv) Gannett (and not MediaNews) shall be entitled to exercise the drag-along rights set forth in Section 9.7 of this Agreement and, if Gannett exercises such right, every reference to “MediaNews” in Section 9.7 shall be changed to “Gannett” and Section 9.7 shall be deemed to be amended in accordance with the foregoing. From and after the Effective Date, MediaNews will, at its expense, (x) execute and deliver, or cause to be executed and delivered, such documents to Gannett and the Partnership (including, but not limited to, any amendments to this Agreement) and take such actions as Gannett may reasonably request in order to effect the foregoing changes; and (y) use all reasonable efforts to obtain any third party consents or approvals which may be necessary in connection with any of the foregoing changes.

     8.11 MediaNews Change in Control.

     (a) In General. MNG shall give prior written notice to Gannett of any proposed MediaNews Change in Control that either the stockholders or board of directors of MNG intend to accept (the “MNG Notice”), which notice shall specify the

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identity of the potential acquirer(s) and the structure of the proposed transaction. MNG shall promptly revoke any MNG Notice, upon written notice to Gannett, if the proposed transaction to which such MNG Notice relates is terminated for any reason. Gannett shall have the option, exercisable in its sole discretion, by giving written notice to MediaNews (the “Gannett Notice”) within thirty (30) days following receipt of a MNG Notice, to elect to assume sole responsibility for the operation and management of the Gannett Designated Newspapers (as defined below) (which Gannett Designated Newspapers shall be specified by Gannett in such Gannett Notice), and in which case MediaNews shall assume sole responsibility for the operation and management of the remaining newspapers of the Partnership, in each case as provided in the Third Amended and Restated Partnership Agreement. If Gannett provides the Gannett Notice to MediaNews within such 30-day period, (x) the Partners shall enter into and deliver the Third Amended and Restated Partnership Agreement within fifteen (15) days of the delivery of the Gannett Notice to MediaNews and (y) the proposed MediaNews Change in Control shall not be consummated, and the representatives of MediaNews then serving on the Management Committee shall not be replaced by MediaNews without consent of Gannett, until at least forty-five (45) days after the date of delivery of the MNG Notice to Gannett; provided, however, that if MediaNews has not executed and delivered to Gannett the Third Amended and Restated Partnership Agreement prior to the end of such 45-day period, such 45-day period shall be extended and the proposed MediaNews Change in Control shall not be consummated until after the Third Amended and Restated Partnership Agreement has been executed by MediaNews and delivered to Gannett; provided, further, that the Third Amended and Restated Partnership Agreement shall not become effective unless and until the consummation of the proposed MediaNews Change in Control referenced in the MNG Notice (the “Effective Date of the MNG Change in Control”).

     (b) Gannett Designated Newspapers. As used in this Agreement, “Gannett Designated Newspapers” shall mean all of the assets used, held for use in, located at the premises of, or shown on the financial statements of one or more newspapers selected by Gannett, in its sole discretion, which are owned directly or indirectly by the Partnership and are located in the same geographic regions, so long as the then total fair market value of the Gannett Designated Newspapers reasonably approximates the then fair market value of Gannett’s Interest in the Partnership. The assets eligible for selection by Gannett as Gannett Designated Newspapers shall include, but not be limited to, (i) all of the types of Gannett Assets and/or MediaNews Assets (in each case, as defined in the Contribution Agreement), as the case may be, and the related current liabilities, associated with any of such newspapers; and/or (ii) if Gannett has made or committed to make the Gannett CNP Contribution, the Gannett CNP Interest (and, for the purpose of this Agreement, all of the newspapers which at any time are owned by CNP shall be deemed to be located in the same geographic region). If Gannett provides the Gannett Notice in accordance with clause (a) of this Section 8.11, following the Effective Date of the MNG Change in Control, Gannett and MediaNews shall each have the option, exercisable in its sole discretion at any time after December 25, 2012 (or, if Gannett has made the CNP Contribution, seven years and one day after the CNP Contribution Date) by giving written notice to the other Partners (the “Dissolution Notice”), to cause the Partnership to dissolve in accordance with Section 8.11(c).

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Notwithstanding any provision of this Section 8.11 to the contrary, if the MNG Notice is received by Gannett after December 25, 2012 and Gannett has made the CNP Contribution, the proposed MediaNews Change in Control may be consummated after thirty (30) days following the date of receipt by Gannett of the MNG Notice and (x) no change to the operation or management of any of the Partnership’s newspapers and no amendment to this Agreement shall be required pursuant to this Section 8.11, (y) following the Effective Date of the MNG Change in Control, Gannett shall have the option, exercisable in its sole discretion at any time thereafter, to cause the immediate dissolution of the Partnership in accordance with Section 8.11(c), by giving the Dissolution Notice to the other Partners, and (z) Gannett shall specify the Gannett Designated Newspapers in such Dissolution Notice.

     (c) Dissolution of the Partnership. If Gannett or MediaNews exercises its option to dissolve the Partnership in accordance with Section 8.11, a committee of six (6) persons, three (3) of which are to be appointed by Gannett and three (3) of which are to be appointed by MediaNews, pursuant to the procedures in Section 8.1, which committee shall act only by unanimous consent (collectively, the “Dissolution Committee”), shall serve as the liquidator of the Partnership (instead of the Management Committee as otherwise set forth in Section 10.3) to wind up the affairs of the Partnership pursuant to this Section 8.11. In performing its duties as liquidator, the Dissolution Committee shall, unless otherwise agreed to by the Partners, make an in kind distribution of the assets of the Gannett Designated Newspapers to Gannett and an in kind distribution of assets of the other newspapers owned directly or indirectly by the Partnership to MediaNews. In liquidating the Partnership, the Dissolution Committee, in its reasonable discretion, shall apply the assets of the Partnership as provided in Sections 10.3(b) and (c), except that the Dissolution Committee may require liabilities of the Partnership associated with a newspaper of the Partnership that is distributed in kind to not be paid and instead to be assumed by the Partner that is to receive the in kind distribution of such newspaper assets. Any Partner receiving an in kind distribution of newspaper assets shall enter into a reasonable and customary cross-indemnification agreement in favor of the Partnership and the other Partner(s) with respect to the liabilities of the newspaper that is distributed in kind, in form and substance reasonably acceptable to the Dissolution Committee. The Dissolution Committee, in its capacity as liquidator, (x) shall have the right to compel each Partner to contribute an appropriate amount of cash to the Partnership to the extent necessary to equalize the relative values of the newspaper assets to be distributed in kind to the Partners, and /or (y) shall distribute an appropriate amount of cash to address any differences in the relative values of assets (taking into account any assumed liabilities) and cash distributed to the Partners. Prior to making any liquidating distributions, the Dissolution Committee shall furnish each of the Partners with a statement that shall set forth the values of the assets and liabilities of the Partnership as of the date of dissolution and as of the date of the planned liquidation, the share of each Partner thereof and a description of the newspaper assets and/or cash that each Partner is to receive as its liquidating distribution, the amount of cash (if any) that is to be contributed by any Partner, and a reasonably detailed report of the manner of disposition of the assets of the Partnership, and such statement and report shall be final and binding on the Partners and the Partnership. If, however, the Dissolution Committee is unable to agree upon the terms

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of such statement and report within thirty (30) days after the date of the Dissolution Notice, the fair market values of the assets of the Partnership shall be determined consistent with the approach set forth in Section 9.5(f), and the Dissolution Committee shall distribute the property and/or cash of the Partnership in accordance with such determination of values. The unanimous determination of the Dissolution Committee as to the value of each of the Partnership’s assets, or the determination of the appraisers appointed pursuant to Section 9.5(f), as applicable, shall conclusively establish the value of the Partnership’s properties and shall be final and binding upon the Partners and the Partnership. From and after the date of the Dissolution Notice, each of the Partners and their Affiliates will, at their expense, (1) execute and deliver to the other Partners and the Partnership such documents and take such actions as the Dissolution Committee may reasonably request in order to effect such dissolution and winding up of the affairs of the Partnership; and (2) use all reasonable efforts to obtain any third party consents or approvals (including, but not limited to, approvals of governmental authorities) which may be necessary in connection with the dissolution and winding up of the affairs of the Partnership.

ARTICLE IX
TRANSFER OF PARTNERSHIP INTERESTS;
ADDITIONAL AND SUBSTITUTE PARTNERS

     9.1 Prohibited Transfers. No Partner may Transfer its Interest or any part thereof in any way whatsoever, and any such Transfer in violation of this Article IX shall be null and void as against the Partnership, except as otherwise permitted herein or provided by law, and the Transferring or withdrawing Partners shall be liable to the Partnership and the other Partners for all damages that they may sustain as a result of such attempted Transfer or withdrawal.

     9.2 Permitted Transfers by Partners. No Partner may Transfer all or a portion of its Interest unless all of the conditions set forth in Section 9.5 have been satisfied, in addition to each of the following conditions:

          (a) the Partner desiring to consummate such Transfer (the “Assigning Partner”), and the prospective Transferee each execute, acknowledge and deliver to all the other Partners such instruments of transfer and assignment with respect to such Transfer and such other instruments as are reasonably satisfactory in form and substance to all the Partners;

          (b) the Transfer will not violate any federal or state laws;

          (c) the Transfer will not cause any violation of or an event of default under, or result in acceleration of any indebtedness under, any note, mortgage, loan, or similar instrument or document to which the Partnership is a party;

          (d) the Transfer will not cause a material adverse tax consequence to the Partnership or any of the Partners including but not limited to any material adverse tax consequence resulting, directly or indirectly, from the termination of the Partnership under section 708 of the Code;

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          (e) the Transfer will not cause the Partnership to be classified as an entity other than a partnership for purposes of the Code; and

          (f) except for transfers of a Partner’s Interest to an Affiliate of such Partner, any amendments to this Agreement required by or made a condition by any Partner to its consent to the transfer, have been made.

     9.3 Substitute Partner. A Transferee of the whole or any part of an Interest who satisfies all of the conditions referenced in Section 9.2 hereof shall have the right to become a Partner in place of the Assigning Partner only if all of the following conditions are satisfied:

          (a) the fully executed and acknowledged written instrument of assignment that has been filed with the Partnership sets forth a statement of the intention of the Assigning Partner that the Transferee become a Substitute Partner in its place;

          (b) the Transferee executes, adopts and acknowledges this Agreement (as it may be amended) and agrees to assume all the obligations of the Assigning Partner; and

          (c) any costs of the Transfer incurred by the Partnership shall have been reimbursed by the Assigning Partner or the Transferee to the Partnership.

     9.4 Involuntary Withdrawal by a Partner. With respect to the Transfer of a Partner’s Interest due to bankruptcy, or other insolvency, involuntary dissolution or liquidation, and any foreclosure (or other exercise of remedies by a party holding a security interest in such Interest) (each, an “Involuntary Transfer”), the Partner with respect to whom such event occurred shall forthwith cease to be a Partner and shall have no rights or powers as a Partner except for such rights as are specified pursuant to Articles III, IV and V and Section 10.3(b) hereof.

     9.5 Right of First Refusal for Sale of Partnership Interests.

          (a) No Partner may voluntarily Transfer all or any part of its Interest in the Partnership to any party (i) in any case prior to December 31, 2008 or (ii) after that date unless it has complied with the procedures of Section 9.2 and first offers to sell such Interest to the other Partner(s) pursuant to the terms of this Section 9.5; provided that this Section 9.5 shall not be applicable with respect to a Transfer to an Affiliate of the transferring Partner.

          (b) A Partner (the “Offering Partner”) who has received a firm, written, bona fide offer from a third-party for its Interest (a “Third Party Offer”) or who has otherwise determined to offer its Interest for sale shall, before offering such Interest or agreeing to accept such offer for such Interest (in either case, the “Offered Interest”), give written notice to the other Partners that are not Affiliates of the Offering Partner (each an “Option Partner”) of such offer or intent including, in the case of a Third Party Offer, a copy of such Third Party Offer and a complete description thereof including, by way of example but not of limitation, the nature and extent of such Third Party Offer, the purchase price therein, the terms of payment and the time for performance.

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          (c) Upon receiving the Offering Partner’s written notice pursuant to Section 9.5(b), the Option Partner(s) shall have a period of thirty (30) days following the date of receipt by the Option Partner of the Offering Partner’s notice to elect to purchase the Offered Interest at the price determined in accordance with Section 9.5(f). If an Option Partner desires to purchase the Offered Interest it shall give written notice to the Offering Partner in the manner set forth in Section 13.2 hereof within such 30-day period. To be effective, this notice must be received by the Offering Partner within such 30-day period. In no event may the Option Partner(s) elect to acquire less than all of the Offered Interest. To the extent there is more than one Option Partner, the Option Partners accepting such offer shall be jointly and severally liable to the Offering Partner to purchase all of the Offered Interest.

          (d) The closing of the sale and purchase of the Offered Interest shall be promptly completed, but in any event, to the extent practicable, within ninety (90) days after the receipt of the Option Partner(s)’ notice of acceptance (or such later date as necessary to obtain any necessary regulatory approvals). The Management Committee shall assist in coordinating the closing. At the closing, the Offering Partner shall sell the Offered Interest, free and clear of all liens and encumbrances, and execute and deliver such assignment(s) and all other documents or other instruments of assignment or conveyance necessary to effect and evidence the assignment. At the closing, the Option Partner(s) shall deliver to the Offering Partner cash, a certified or official bank check or shall pay by wire transfer of immediately available funds for the applicable purchase price.

          (e) If the Option Partner(s) do not elect to purchase all of the Offered Interest pursuant to this Section 9.5, then the Offering Partner shall be free to sell, assign, transfer, pledge, encumber or otherwise dispose of the Offered Interest pursuant to the Third Party Offer or, in the case of a non-Third Party Offer, to any third party for an amount equal to Fair Market Value of the Offered Interest, as hereunder determined, in either case, within six month’s after the date of the Option Partner(s)’ notice of refusal or after the expiration of the 30-day response period, whichever occurs first. For purposes of this Section 9.5(e), a sale shall be deemed made when there is executed a legally binding agreement between the Offering Partner and the prospective purchaser, subject to no condition or contingency which permits the prospective purchaser to terminate or cancel the agreement, except for the default of the Offering Partner, and routine approvals or conditions. If a sale within the meaning of this Section 9.5(e) is not made within such 6-month period, then the Offered Interest shall remain subject to the restrictions of this Agreement and must again be first offered to the Option Partner(s) if the Offering Partner thereafter wishes to sell its Interest to a third party.

          (f) (i) In the case of a Third Party Offer, if the consideration offered by the prospective purchaser is offered in cash and/or a promissory note or other similar instrument to be issued by the prospective purchaser, the price shall be the price offered by such prospective purchaser. If (A) the consideration offered by the prospective purchaser is offered in a form other than cash and/or a promissory note or other similar instrument or (B) the Offering Partner has not received a Third Party Offer, then in either case, the price shall be the Fair Market Value of the Offered Interest, as defined below.

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               (ii) For the purposes of this Agreement, “Fair Market Value of the Offered Interest” shall be the amount that would be paid for the Offered Interest in the Partnership as a going concern, on a consolidated basis, by a willing buyer to a willing seller. The Offering Partner and the Option Partner(s) may mutually agree as to the Fair Market Value of the Offered Interest in question. If the Offering Partner and the Option Partner(s) are unable to agree on the Fair Market Value of the Offered Interest within fifteen (15) days after the Offering Partner’s written notice of the proposed sale, then in such event Fair Market Value of the Offered Interest shall be determined pursuant to Section 9.5(f)(iii) by two independent qualified appraisers, one to be appointed by the Offering Partner and the other to be appointed by the Option Partner(s).

               (iii) The two independent appraisers shall be appointed within fifteen (15) days after receipt by the Option Partner(s) of the notice of proposed sale. If either side fails to appoint an appraiser within such period, then its right to do so shall lapse and the appraisal made by the one independent appraiser who is timely appointed shall be the Fair Market Value of the Offered Interest. If two appraisals are made, and if the two appraised values differ by less than 15 percent, Fair Market Value of the Offered Interest shall be the average of the two appraisals, and if the two appraised values differ by more than 15 percent, the two appraisers shall jointly select a third appraiser and, the Fair Market Value of the Offered Interest shall be the average of the two of the three appraisals that are closest together in amount. All appraisals shall be made within thirty (30) days of appointment of an appraiser, and written notice of the results of such appraisals shall be given to all parties within such 30-day period. The Fair Market Value of the Offered Interest shall be determined based upon the value of the Partnership in its entirety as a going concern, with the Offering Partner receiving a proportionate part of such total value based upon its Percentage Interest. In making any appraisal hereunder, all debts and liabilities shall be taken into account. Each side shall pay the fees of the appraiser selected by them.

     9.6 Tag-Along Rights Regarding Sales of Partnership Interests.

          (a) Except for Transfers of a Partner’s Interest to an Affiliate of such Partner and except following an Involuntary Transfer of a Partner’s Interest, in any case where a Partner has declined to exercise its rights of first refusal under Section 9.5, no Partner (the “Tag-Along Offeror”) shall, individually or collectively, in any one transaction or series of transactions, directly or indirectly, sell or otherwise dispose of its Interest, to any person (a “Third Party”) unless the terms and conditions of such sale or other disposition to such Third Party shall include an offer to each other Partner (each, a “Tag-Along Offeree”) to include, at the option of each Tag-Along Offeree, in the sale or other disposition to the Third Party, such Tag-Along Offeree’s Interest (the “Tag-Along Right”). Each Partner proposing to effect such a sale or other disposition shall send a written notice (the “Tag-Along Notice”) to each of the Tag-Along Offerees setting forth the terms of the offer. At any time within 15 days after its receipt of the Tag-Along Notice, each Tag-Along Offeree may exercise its Tag-Along Option by furnishing written notice of such exercise (the “Tag-Along Exercise Notice”) to the Tag-Along Offeror.

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          (b) If the proposed sale or other disposition to the Third Party by the Partner providing the Tag-Along Notice is consummated, each Tag-Along Offeree shall have the right to sell such Third Party all of its Interest.

          (c) Each Partner participating in the sale or other disposition to the Third Party shall have the right, in their sole discretion, at all times prior to consummation of the proposed sale or other disposition giving rise to the Tag-Along Right granted by this Section to abandon, rescind, annul, withdraw or otherwise terminate such sale or other disposition as it relates to such Partner’s Interest whereupon that Partner’s Tag-Along Rights in respect of such sale or other disposition pursuant to this Section shall become null and void, and neither the Tag-Along Offeror nor the Third Party shall have any liability or obligations to the withdrawing Tag-Along Offeree with respect thereto by virtue of such abandonment, rescission, annulment, withdrawal or termination.

          (d) The purchase of each Tag-Along Offeree’s Interest pursuant to this Section shall be on the same terms and conditions, including but not limited to the purchase price (as adjusted for any difference in size of the respective Interest’s), as are applicable to the Partner giving the Tag-Along Notice, which shall be stated in such Tag-Along Notice. In determining the purchase price of any Interest under this Section, the aggregate purchase price of all Interests being acquired by the Third Party shall be increased to the extent any of the selling Partners shall receive additional compensation (A) for covenants not to compete or (B) for services (such as pursuant to consulting agreements or management agreements) which are in excess of the amounts which would be payable for comparable services as a result of an arm’s-length transaction.

          (e) If, within 15 days after receipt of a Tag-Along Notice, any Tag-Along Offeree has not delivered a Tag-Along Exercise Notice, such Tag-Along Offeree will be deemed to have waived any and all of its rights with respect to the sale or other disposition of Interests described in such Tag-Along Notice and the other Partners shall have 135 days following the expiration of such 15-day period in which to consummate such sale or other disposition on terms not more favorable to such other Partners than those described in the Tag-Along Notice. If, at the end of 150 days following receipt of such Tag-Along Notice, the sale or other disposition described therein has not been completed, then all restrictions on sale or other disposition contained in this Agreement shall again be in effect.

     9.7 MediaNews Drag-Along Rights.

          (a) Subject to Section 8.10 hereof, if at any time after December 31, 2008, MediaNews receives a bona fide written offer to purchase all of the Interests in the Partnership from an independent third party, in one transaction or a series of transactions, and MediaNews determines to accept such offer, then, notwithstanding any other provisions of this Agreement, at MediaNews’ election, all other Partners shall, subject to (b) below, be required to sell their respective Interests on the same terms and conditions (except for adjustments based upon the relative size of Percentage Interests) as have been offered to MediaNews (the “MediaNews Drag-Along Rights”); provided that the aggregate purchase price of all Interests being acquired by the Third Party shall

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be increased to the extent any of the selling Partners shall receive additional compensation (A) for covenants not to compete or (B) for services (such as pursuant to consulting agreements or management agreements) which are in excess of the amounts which would be payable for comparable services as a result of an arm’s-length transaction; and further provided that all other Partners receive fair market value (as determined in accordance with Section 9.5(f)) for their Interest.

          (b) Subject to Section 8.10 hereof, if MediaNews elects to exercise its Drag-Along Rights, it shall provide written notice (the “Drag-Along Notice”) to each other Partner of such election at least 60 days in advance of the proposed closing date for such transaction, which notice shall describe the terms and conditions of such offer and the proposed closing date. Such Drag-Along Notice shall be deemed a Third Party Offer (as defined in Section 9.5(b) hereof) with respect to the Interest of MediaNews and shall be subject to the right of first refusal of the other Partners that are not Affiliates of MediaNews (each, an “Option Partner”) pursuant to Section 9.5 hereof. If the Option Partner provides written notice to MediaNews of its election to purchase the Offered Interest within thirty (30) days following the date of receipt by the Option Partner of the Drag-Along Notice, the sale to the Option Partner shall be completed in accordance with Section 9.5 hereof. If the Option Partner fails to provide such notice within such 30-day period, then the Option Partner shall be obligated to sell its entire Interest to the Third Party making such offer on the terms set forth in the Drag-Along Notice. However, if the transaction is not completed within 90 days after the giving of the Drag-Along Notice, then any sale thereafter by MediaNews of its Interest with respect to which it wishes to exercise its Drag-Along Rights shall require a new notice under this Section 9.7(b).

     9.8 Admission of Additional Partners. A person shall become an Additional Partner only if and when each of the following conditions is satisfied:

          (a) the Management Committee, unanimously and in its sole and absolute discretion, determine the Additional Contribution Terms;

          (b) the Partnership has complied with the terms of Section 3.1(b);

          (c) all of the Partners consent in writing to such admission, which consent may be withheld by any such Partner in its sole and absolute discretion;

          (d) the Management Committee receives written instruments (including, without limitation, such person’s consent to be bound by this Agreement (as it may be amended) as an Additional Partner) that are in a form satisfactory to the Management Committee (as determined in its sole and absolute discretion);

          (e) the Partnership has received such person’s Capital Contribution; and,

          (f) any amendments to this Agreement required by or made a condition by any Partner to its consent to the transfer, have been made.

     9.9 Acknowledgment of Pledge of Interests. Gannett hereby (i) acknowledges that MediaNews’ Interest in the Partnership has been pledged as security under an Amended and Restated Credit Agreement dated as of December 30, 2003, as currently amended, among MediaNews Group, Inc., Bank of America, N.A., and other banks, as

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amended, substituted, refinanced, renewed or replaced (without regard to the amount of credit extended thereunder or the identity of the lenders or agents with respect thereto) and (ii) without limitation of its rights under Section 8.10, agrees that any foreclosure on such pledge shall not be deemed a Transfer for purposes of Sections 9.3, 9.5, 9.6 and 9.7 (but shall be deemed an Involuntary Transfer pursuant to Section 9.4).

     9.10 Rights of First Refusal with Respect to Certain Assets Offered to the Partners. With respect to any offer or sale of substantially all of the assets, properties and goodwill of: (a) any newspapers or related publications a majority of the circulation of which occurs in the State of New Mexico, with the exception of McKinley county, Bernalillo county, and Santa Fe county; (b) any newspapers or related publications a majority of the circulation of which occurs in the counties of Adams, Berks, Cumberland, Dauphin, Franklin, Lancaster, Lebanon, Perry or York in the Commonwealth of Pennsylvania or in El Paso county, Texas; or (c) any radio or television station licensed in Dona Ana, Otero, or Eddy counties, New Mexico or the El Paso television DMA or the Harrisburg-Lancaster-Lebanon-York television DMA that is made to either Gannett or MediaNews or their respective Affiliates during the term of this Agreement (other than offers which relate to assets, properties and goodwill which the party receiving such offer is, as of the date of this Agreement, contractually obligated to offer to a third person an equity interest therein, or other investment opportunity with respect thereto), such party (the “Notifying Party”) shall give prompt written notice of such offer to the other Partner. Should the other Partner give written notice to the Notifying Party of its approval of the negotiation for the acquisition of such assets, properties and goodwill by the Partnership within 10 days of its receipt of the Notifying Party’s notice of the offering of such assets, the Notifying Party shall not negotiate to acquire such assets, properties and goodwill for its own account, and the Notifying Party shall instead permit the Partnership to negotiate for the acquisition of such assets, properties and goodwill from the seller of such assets. Should the other Partner fail to provide the Notifying Party such written notice of approval, the Notifying Party may proceed to acquire such assets, properties and goodwill for its own account and ownership.

ARTICLE X
DISSOLUTION AND LIQUIDATION

     10.1 Dissolution.

          (a) The Partnership shall be dissolved upon the first to occur (each a “Dissolution Event”):

               (i) December 31, 2053;

               (ii) At any time after December 25, 2012 (or, if Gannett has made the Gannett CNP Contribution, seven years and one day after the CNP Contribution Date), the election by written notice to the other Partners by one or more Partners (the “Electing Partner”) to terminate the Partnership prior to December 31, 2053; provided, however, that such right may be exercised at any time in connection with an Involuntary Transfer of a Partner’s Interest or to the extent required to effect compliance with the provisions of any indenture applicable to publicly held indebtedness

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of a Partner; provided, further, that MediaNews shall not be entitled to make any election to terminate the Partnership pursuant to this paragraph, or to cause or permit any election that was previously made pursuant to this paragraph to be continued, from and after the date of any MNG Notice, unless and until MNG has confirmed in writing to Gannett that such MNG Notice has been revoked by MNG and that the proposed transaction described in such MNG Notice will not be consummated;

               (iii) Upon the election by Gannett or MediaNews to dissolve the Partnership following a MediaNews Change of Control, as provided in Section 8.11 of this Agreement; or

               (iv) The occurrence of any other event specified under the Delaware Uniform Partnership Law (6 Del. C. 1953, Section1501 et seq.) as one effecting such dissolution.

          (b) Notwithstanding the provisions of subsection (a)(ii) above, a dissolution of the Partnership (other than a dissolution described in Section 10.1(a)(iii) hereof) shall not occur if, within 10 business days of receipt of the written notice described in subsection (a)(ii) above, the Partners other than the Partner who is the Electing Partner provide written notice to the Electing Partner of their election to continue the business of the Partnership and of their undertaking to cause the Partnership to enter into a contract to redeem all of the Interest in the Partnership of the Partner electing to terminate the Partnership, in exchange for a distribution of cash equal to the then-determined fair market value of such Interest (net of any liabilities allocable to such Interest) plus the amounts described in the second to last sentence of Section 10.1 (c) within 2 years of the date the fair market value of such Interest is determined under this Section 10.1(b). Such fair market value shall be determined in accordance with the procedures set forth in Section 9.5(a) through (f) above, provided, however, that the period for negotiation between the Partners set forth in Section 9.5(f)(ii) shall be 90 days. At the time such fair market value is determined, the Interest of the Electing Partner in the Partnership shall terminate and Electing Partner shall be treated as a “retiring partner” for purposes of Code Section 736 and the payment described in this Section 10.1(a) shall be treated as described in Code Section 736(b).

          (c) Upon the date of the determination of such fair market value, the Electing Partner’s right to receive any distribution or allocation of Profits from the Partnership under Section 4.2(b) shall convert automatically into a first priority interest in the Profits of the Partnership equal to the product of (x) the determined fair market value of such Interest and (y) LIBOR plus (I) 1 percent for the first 6-month period following the date of determination of the fair market value; (II) 2 percent for the seventh through ninth months following the date of determination of the fair market value; (III) 3 percent for the tenth through twelfth months following the date of determination of the fair market value; (IV) 4 percent for the thirteenth through fifteenth months following the date of determination of the fair market value; (V) 5 percent for the sixteenth through eighteenth months following the date of determination of the fair market value; (VI) 6 percent for the nineteenth through twenty-first months following the date of determination of the fair market value; and (VII) 7 percent for the twenty-second through twenty-fourth months following the date of determination of the fair market value. The

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payments described in this Section 10.1(c) shall be treated as distributions of partnership income as described in Code Section 736(a).

     10.2 Election to Continue the Business. The Partnership shall also not be dissolved pursuant to a Dissolution Event specified in Sections 10.1(a)(i) or (iv) (except as otherwise provided in the Act), if, within 20 business days of such Dissolution Event, all the remaining Partners unanimously agree in writing to continue the business of the Partnership.

     10.3 Closing of Affairs.

          (a) In the event of the dissolution of the Partnership for any reason, and in the absence of an election pursuant to Section 10.2 hereof to continue the business of the Partnership, (i) the Management Committee or (ii) from the date of any MNG Notice and continuing thereafter unless and until such MNG Notice has been revoked in writing by MNG prior to the consummation of the proposed transaction described in such MNG the Notice, the Dissolution Committee, shall commence to close the affairs of the Partnership, to liquidate or retain for distribution to the Partners its investments and to terminate the Partnership, in each instance in such manner as the Management Committee or Dissolution Committee (as the case may be) may reasonably determine to be appropriate, provided, however, that (except as expressly provided in Section 8.11 hereof in connection with a dissolution following a MediaNews Change in Control) no distribution of any Partnership property shall be made to any of the Partners (except for pro rata distributions) except upon the prior approval of all of the Partners. Upon complete liquidation of the Partnership’s property and compliance with the distribution provisions set forth in Section 10.3(b) hereof, the Partnership shall cease to be such, and the Management Committee or Dissolution Committee (as the case may be) shall cause to be executed, acknowledged and filed all certificates necessary to terminate the Partnership.

          (b) In liquidating the Partnership, the assets of the Partnership shall be applied to the extent permitted by the Act in the following order of priority:

               (i) First, to pay the costs and expenses of the closing of the affairs and liquidation of the Partnership;

               (ii) Second, to pay the matured debts and liabilities of the Partnership;

               (iii) Third, to establish reserves adequate to meet any and all contingent or unforeseen liabilities or obligations of the Partnership, provided that at the expiration of such period of time as the Management Committee or Dissolution Committee (as the case may be) may deem advisable, the balance of such reserves remaining after the payment of such contingencies or liabilities shall be distributed as hereinafter provided;

               (iv) Fourth, to all Partners in proportion to each Partner’s Percentage Interest in the Partnership, after taking appropriate account of, and making appropriate adjustments for, (A) any Indebtedness then remaining outstanding which is attributable to any Partnership assets previously contributed by a particular partner, and

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(B) any portion of any required capital contributions or accrued but unpaid interest described in either Section 3.1(b) or 3.1(c) of this Agreement which then remains outstanding, (provided, however, that to the extent that any Partner has a finally adjudicated indemnity obligation to any other Partner, any distribution that would otherwise be distributed to the Partner subject to such obligation shall be distributed to the Partner(s) entitled to the benefit of the indemnity obligation to the extent thereof).

          (c) No Partner shall have any obligation to restore a deficit balance in its Capital Account.

ARTICLE XI
AMENDMENT TO AGREEMENT

     Amendments to this Agreement and to the Certificate of Formation of the Partnership shall be approved in writing by all of the Partners. An amendment shall become effective as of the date specified in the Partners’ approval or if none is specified as of the date of such approval or as otherwise provided in the Act.

ARTICLE XII
INDEMNIFICATION

     12.1 General. From and after the Closing, the Partners shall indemnify each other as provided in this Article XII. As used in this Agreement, the term “Damages” shall mean all liabilities, demands, claims, actions or causes of action, regulatory, legislative or judicial proceedings or investigations, assessments, levies, losses (including, without limitation, any adverse tax consequences to other parties arising directly or indirectly from a violation of a covenant in this Agreement by a party and reduction in profits and diminution in the value of an interest in the Partnership), fines, deficiencies, interest, penalties, damages, judgments, costs and expenses, including, without limitation: reasonable attorneys’, accountants’, investigators’, and experts’ fees and expenses sustained or incurred in connection with the defense or investigation of any such claim.

     12.2 Indemnification Obligations. Notwithstanding any other provision of this Agreement, each party (an “Indemnifying Party”) shall defend, indemnify, save and keep harmless the other Partners, their Affiliates, the Partnership, York LLC and their respective successors and permitted assigns (collectively, the “Indemnified Parties”) against and from any and all Damages sustained or incurred by any of them resulting from or arising out of or by virtue of:

          (a) any breach of any representation or warranty made by the Indemnifying Party in this Agreement;

          (b) any breach by the Indemnifying Party of, or failure by the Indemnifying Party to comply with, any of its covenants or obligations under this Agreement (including, without limitation, their obligations under this Article XII); or

          (c) any indemnification obligation of such party or any Affiliate thereof arising under the provisions of Article X of the Contribution Agreement.

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     Except as provided in the succeeding two paragraphs of this Section 12.2, any indemnification obligation arising under this Article XII and/or Article X of the Contribution Agreement shall be discharged by a capital contribution by the Partner owing such obligation to the Partnership in the amount of the Damages relating thereto. Any payment by the Partnership of Damages to which an indemnification obligation relates shall be charged as a distribution to the Indemnifying Partner and taken into account for purposes of current and future distributions made by the Partnership pursuant to Section 5.1. In addition, no item of Partnership property shall be revalued to reflect such indemnification payment. From the date of determination of such obligation (which shall be the date agreed by the parties or the date of a final binding determination by a mediator or the date of a final, non-appealable determination by a court of competent jurisdiction, as applicable) and until such obligation (and all accrued interest, if any, with respect thereto) has been paid in full in cash or other immediately available funds, all cash distributions to which a Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such capital contribution and to pay accrued but unpaid interest as provided in Section 3.1(c) hereof.

     Notwithstanding any other provision of this Agreement to the contrary, in the event any indemnification obligation arises under Section 10.6 of the Contribution Agreement and Gannett reasonably determines that such claim is likely to result in Damages which would impact more than one fiscal year of the Partnership (each, a “York Indemnity Claim”), Gannett shall have the option to invoke the remedy described in this paragraph with respect to such York Indemnity Claim in lieu of the remedies described in the immediately preceding paragraph of this Section. Such option may be exercised by Gannett, in its sole discretion, by providing written notice to the Partnership and MediaNews (each, a “Gannett Claim Notice”), within thirty (30) days of any such determination, which sets forth with reasonable specificity the basis for the claim for indemnification, the nature of the claim and the basis and methodology for calculating the amount of the proposed reduction in the MediaNews Percentage Interest and the proportionate increase in the Gannett Percentage Interest as a result of such York Indemnity Claim. The parties agree that of MediaNews’ 59.36% Percentage Interest, a 29.50% Percentage Interest shall be treated by the parties as being attributable to the contribution of the York Partnership Interest to the Partnership pursuant to Section 2.5(a) of the Contribution Agreement. With respect to any York Indemnity Claim subject to a Gannett Claim Notice, the parties agree that MediaNews’ Percentage Interest shall be adjusted to the following percentage: (I) the sum of (a) the excess of 59.36 over 29.50 plus (b) the product of 29.50 times a fraction, the numerator of which is the fair market value of the York Partnership Interest on the date of the Gannett Claim Notice (taking into account all Damages resulting from or arising out of or by virtue of such York Indemnity Claim, including, but not limited to, the adverse effect, on a present value basis, of any changes which impact the subsequent business or operations of the York Limited Partnership) and the denominator of which is the fair market value of the York Partnership Interest immediately prior to the date that such indemnification obligation first arose (for purposes of clarification, this fraction cannot be greater than 1), divided by (II) 100 plus the amount described in (I)(b) above minus 29.50.

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     If MediaNews objects to the proposed reduction in the MediaNews Percentage Interest set forth in the Gannett Claim Notice, MediaNews shall notify Gannett in writing of the basis for its objection within fifteen (15) business days after receipt of the Gannett Claim Notice and, pursuant to the procedures set forth in Section 13.1 hereof (except that no further written notice of the matter in dispute shall be required), the parties shall attempt to agree upon the fair market values of the York Partnership Interests for purposes of the applicable fraction set forth above. If the parties are unable to agree on the fair market values of the York Partnership Interest pursuant to Section 13.1, then MediaNews shall select an independent qualified appraiser (with the concurrence of Gannett, which concurrence shall not be unreasonably withheld) to determine the fair market values of the York Partnership Interests for purposes of the applicable fraction set forth above, and the parties shall abide by the conclusions of such appraiser which shall be final and binding upon the parties. The Partnership shall pay the fees of any such appraiser. Any indemnification obligation with respect to a York Indemnification Claim subject to a Gannett Claim Notice shall be discharged upon a reduction in the MediaNews Percentage Interest and proportionate increase in the Gannett Percentage Interest pursuant to this paragraph, and such discharge shall be effective as of the date of the applicable Gannett Claim Notice. Notwithstanding the preceding sentence, from and after the date of any Gannett Claim Notice, unless otherwise agreed by the parties, all cash distributions to which MediaNews shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof shall continue to be distributed to MediaNews until (i) MediaNews has made an additional capital contribution to the Partnership pursuant to the next paragraph of this Section or (ii) MediaNews has failed to exercise its option to make an additional capital contribution to the Partnership within the 30-day period referenced in the next paragraph of this Section, in either of which events, any future distributions to which MediaNews would otherwise be entitled to receive pursuant to Section 5.1(a) hereof shall be equitably adjusted (including accrued interest at a rate of 5% per annum), retroactive to the date of the Gannett Claim Notice, to take into account the period during which the MediaNews Percentage Interest was reduced from and after the date of the Gannett Claim Notice.

     If, as a consequence of Gannett’s invoking the remedy described in the preceding two paragraphs of this Section, the Percentage Interest of MNG and its Affiliates would be decreased to less than 51%, MediaNews shall have the option, exercisable by written notice to Gannett within 30 days of a final determination of the amount by which MediaNews’ Percentage Interest is to decrease pursuant to the preceding two paragraphs, to contribute to the Partnership additional newspapers, mastheads or related assets owned by it, provided that any such proposed additional capital contribution shall be subject to Gannett’s reasonable concurrence, which such concurrence shall not be unreasonably withheld; and provided, further, that no such proposed additional capital contribution shall cause Gannett’s Percentage Interest to be decreased to a level of less than 90% of the Gannett Percentage Interest which was in effect immediately prior to the date of the Gannett Claim Notice which gave rise to such reduction in MediaNews’ Percentage Interest, without obtaining the prior written consent of Gannett, which may be withheld in Gannett’s sole discretion. Upon receipt by the

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Partnership of an additional capital contribution pursuant to this paragraph, the Capital Account and Percentage Interest of the contributing Partner(s) will be adjusted upward to reflect the fair market value of such contribution (determined in accordance with the procedures set forth in Section 9.5(f)) and, subject to the terms of the immediately preceding sentence, the Percentage Interest of the other Partner(s) will be adjusted downward proportionately to reflect the increase in the contributing Partner’s Percentage Interest.

     12.3 Exclusive Remedy. The sole and exclusive remedy of Indemnified Parties with respect to any and all claims relating to the subject matter of this Agreement shall be pursuant to the indemnification provisions set forth in this Article XII and the Contribution Agreement.

     12.4 Third Party Claims. Promptly following the receipt of notice of any claim for Damages or for equitable relief which are asserted or threatened by a party other than the parties hereto, their successors or permitted assigns (a “Third Party Claim”), the party receiving the notice of the Third Party Claim shall (a) notify the other Partners in writing in accordance with Section 13.2 hereof of its existence setting forth with reasonable specificity the facts and circumstances of which such party has received notice and (b) if the party giving such notice is an Indemnified Party, specifying the basis hereunder upon which the Indemnified Party’s claim for indemnification is asserted. No failure to give notice of a claim shall affect the indemnification obligations of the Indemnifying Party hereunder, except to the extent that the Indemnifying Party can demonstrate that such failure materially prejudiced such Indemnifying Party’s ability to successfully defend the matter giving rise to the claim. The Indemnified Party shall tender the defense of a Third Party Claim to the Indemnifying Party.

     The Indemnified Party shall not have the right to defend or settle such Third Party Claim. The Indemnified Party shall have the right to be represented by counsel at its own expense in any such contest, defense, litigation or settlement conducted by the Indemnifying Party; provided, however, that with respect to any claim under Section 10.6 of the Contribution Agreement, the Indemnifying Party shall be solely responsible for the fees and expenses of outside counsel retained by the Indemnified Party to represent the Indemnified Party in any such contest, defense, litigation or settlement. The Indemnifying Party shall lose its right to defend and settle the Third Party Claim if it shall fail to diligently contest the Third Party Claim. So long as the Indemnifying Party has not lost its right and/or obligation to defend and settle as herein provided, the Indemnifying Party shall have the right to contest, defend and litigate the Third Party Claim and shall have the right, in its discretion exercised in good faith, and upon the advice of counsel, to settle any such matter, either before or after the initiation of litigation, at such time and upon such terms as it deems fair and reasonable; provided that in any event the Indemnifying Party shall consult with the Indemnified Party with respect to settling such matter which decision shall be made by mutual agreement of the Indemnifying Party and the Indemnified Party, not to be unreasonably withheld by either. All expenses (including without limitation attorneys’ fees) incurred by the Indemnifying Party in connection with the foregoing shall be paid by the Indemnifying Party. Notwithstanding the foregoing, in connection with any settlement negotiated by

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an Indemnifying Party, no Indemnified Party shall be required by an Indemnifying Party to (w) enter into any settlement that does not include as an unconditional term thereof the delivery by the claimant or plaintiff to the Indemnified Party of a release from all liability in respect of such claim or litigation, (x) enter into any settlement that attributes by its terms liability to the Indemnified Party, (y) consent to the entry of any judgment that does not include as a term thereof a full dismissal of the litigation or proceeding with prejudice or (z) enter into any settlement which would, or could reasonably be expected to, result in or relate to either a material nonmonetary obligation or restriction of any kind whatsoever being imposed upon the Indemnified Party or Damages other than Damages which are indemnifiable under this Article XII; provided, however, that the Indemnifying Party may enter into the settlements described in (w) and (y) above if (1) such settlement is not in any way materially damaging or harmful to the Partnership’s business or the Indemnified Parties, as the case may be, and (2) the Indemnifying Party agrees to remain liable to the Indemnified Party for indemnification with respect to such claim indefinitely thereafter. No failure by an Indemnifying Party to acknowledge in writing its indemnification obligations under this Article XII shall relieve it of such obligations to the extent they exist. If an Indemnified Party is entitled to indemnification against a Third Party Claim, and the Indemnifying Party fails to accept the defense of a Third Party Claim tendered pursuant to this Section 12.4, the Indemnifying Party shall lose its right to contest, defend, litigate and settle such a Third Party Claim; provided that the Indemnifying Party shall be entitled to participate, at its expense, with counsel of its choice, and any settlement shall be approved by the Indemnifying Party, such approval not to be unreasonably withheld, the Indemnified Party shall have the right, without prejudice to its right of indemnification hereunder, in its discretion exercised in good faith and upon the advice of counsel, to contest, defend and litigate such Third Party Claim, and subject to the preceding sentence may settle such Third Party Claim, either before or after the initiation of litigation. If, pursuant to this Section 12.4, the Indemnified Party so defends or (except as hereinafter provided) settles a Third Party Claim, for which it is entitled to indemnification hereunder, as hereinabove provided, the Indemnified Party shall be reimbursed by the Indemnifying Party for the reasonable attorneys’ fees and other expenses of defending the Third Party Claim which is incurred from time to time, forthwith following the presentation to the Indemnifying Party of itemized bills for said attorneys’ fees and other expenses.

     12.5 Other Indemnification Claims. The Indemnified Party shall give the Indemnifying Party prompt notice of any Indemnification Claim (other than a Third Party Claim) specifying the basis hereunder upon which the Indemnified Party’s claim for indemnification is asserted. No failure to give notice of a claim shall affect the indemnification obligations of the Indemnifying Party hereunder, except to the extent that the Indemnifying Party can demonstrate that such failure materially prejudiced such Indemnifying Party’s ability to successfully defend or otherwise respond to the matter giving rise to the claim. In respect of any Indemnification Claim other than a Third Party Claim, the Partnership shall provide the Indemnifying Party with the opportunity and all appropriate access to the applicable facilities, personnel, books and records necessary to respond to such Indemnification Claim.

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ARTICLE XIII
GENERAL PROVISIONS

     13.1 Mediation. Each Partner agrees that, in the event of any dispute among such Partners regarding the interpretation or application of any provision of this Agreement other than with respect to a potential reduction in the Percentage Interest of MNG and its Affiliates pursuant to the procedures set forth in Section 12.2 of this Agreement (including any dispute regarding the operation of the Partnership that cannot be resolved by the procedures created by the provisions of this Agreement), it will follow the following procedures:

          (a) it will give each other Partner written notice of the matter in dispute;

          (b) it will negotiate reasonably and in good faith with the other Partners in order to resolve such dispute for a period of not less than fifteen (15) business days following receipt of the notice in (a);

          (c) if the dispute has not been resolved by negotiation pursuant to (b), it will cooperate with the other Partners to submit the dispute to an independent mediator (to be selected by the unanimous consent of the Partners, which shall only be withheld on the basis of good faith concerns about the independence or adequacy of expertise of the proposed mediator) who shall have ten (10) business days after the matter is fully submitted to him or her to propose a settlement of the dispute;

          (d) if any Partner refuses, in its sole and unreviewable discretion to accept the proposed resolution of the mediator, it shall give prompt written notice of such refusal to the other Partners and, at any time following receipt of any such notice, any Partner shall be free to pursue any legal, equitable or other remedies available to it regarding the matter in dispute.

     Notwithstanding the foregoing, no Partner shall be required to pursue the notice, negotiation or mediation steps set forth above if it determines, reasonably and in good faith, the delay involved in such procedure would cause irreparable, material harm to it or its interest in the Partnership.

     13.2 Notices. Unless otherwise specifically provided in this Agreement, all notices and other communications required or permitted to be given hereunder shall be in writing, directed or addressed to the respective addresses set forth in Schedule 13.2 attached hereto, and shall be either (i) delivered by hand, (ii) delivered by a nationally recognized commercial overnight delivery service, (iii) mailed postage prepaid by registered or certified mail, or (iv) transmitted by facsimile, with receipt confirmed. Such notices shall be effective: (a) in the case of hand deliveries when received; (b) in the case of an overnight delivery service, when received in accordance with the records of such delivery service; (c) in the case of registered or certified mail, upon the date received by the addressee as determined by the U.S. Postal Service; and (d) in the case of facsimile notices, when electronic indication of receipt is received. Any party may change its address and facsimile number by written notice to the other parties given in accordance with this Section 13.2.

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     13.3 Confidentiality. Each of the Partners agrees that, except as required by law, legal process, government regulators, or as reasonably necessary for performance of its obligations or enforcement of its rights under this Agreement, without the prior written consent of the other Partners, it will treat and hold as confidential (and not disclose or provide access to any person other than such Partner’s attorneys or accountants) and it will cause its Affiliates, officers, managers, partners, employees and agents to treat and hold as confidential (and not divulge or provide access to any person) all information relating to (i) the business of the Partnership and (ii) any patents, inventions, designs, know-how, trade secrets or other intellectual property relating to the Partnership, in each case excluding (A) information in the public domain when received by such Partner or thereafter in the public domain through sources other than such Partner, (B) information lawfully received by such Partner from a third party not subject to a confidentiality obligation and (C) information developed independently by such Partner. The obligations of the Partners hereunder shall not apply to the extent that the disclosure of information otherwise determined to be confidential is required by applicable law, provided, however, that prior to disclosing such confidential information to any party other than a governmental agency exercising its ordinary regulatory oversight of a Partner, a Partner shall notify the Partnership thereof, which notice shall include the basis upon which such Partner believes the information is required to be disclosed. This Section 13.3 shall survive for a period of four years with respect to any Partner that withdraws from the Partnership and, with respect to any dissolution or termination of the Partnership pursuant to Article X hereof, for a period of time agreed by the all of Partners.

     13.4 Entire Agreement, Etc. This Agreement, together with the Contribution Agreement, constitutes the entire agreement among all of the parties hereto relating to the subject matter hereof and supersedes all prior contracts, agreements and understandings among all of them. No course of prior dealings among all of the parties shall be relevant to supplement or explain any term used in the Agreement. Acceptance or acquiescence in a course of performance rendered under this Agreement shall not be relevant to determine the meaning of this Agreement even though the accepting or the acquiescing party has knowledge of the nature of the performance and an opportunity for objection. All waivers, amendments and modifications of this Agreement must be in writing, executed by a duly authorized officer of the party against whom enforcement of any waiver, modification or consent is sought. No waiver of any terms or conditions of this Agreement in one instance shall operate as a waiver of any other term or condition or as a waiver in any other instance.

     13.5 Construction Principles. As used in this Agreement words in any gender shall be deemed to include all other genders. The singular shall be deemed to include the plural and vice versa. The captions and article and section headings in this Agreement are inserted for convenience of reference only and are not intended to have significance for the interpretation of or construction of the provisions of this Agreement.

     13.6 Counterparts. This Agreement may be executed in two or more counterparts by the parties hereto, each of which when so executed will be an original, but all of which together will constitute one and the same instrument.

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     13.7 Severability. If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way unless such invalid or unenforceable provision or clause shall be so significant as to materially affect the parties’ expectations regarding this Agreement. Otherwise, the parties hereto agree to replace any invalid or unenforceable provision with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision.

     13.8 Expenses. The Initial Partners each agree to bear their own costs for all matters involved in the negotiation, execution and performance of this Agreement and related transactions unless otherwise specified herein.

     13.9 Governing Law and Venue. The validity and construction of this Agreement shall be governed by the internal laws (and not the principles of conflict of laws) of the State of Delaware. Subject to the provisions of this Agreement with respect to the resolution by the parties hereto of disputes hereunder pursuant to the mediation provisions herein set forth, any legal action or proceeding with respect to this Agreement may be brought in the courts of the State of Delaware and, by execution and delivery of this Agreement, each of the parties hereto hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts. Each of the parties hereto hereby waives, and agrees not to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement of this Agreement, that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in said courts or that this Agreement may not be enforced in or by said courts or that its property is exempt or immune from execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or (provided that process shall be served in any manner referred to in the following sentence) that service of process upon such party is ineffective. Each of the parties hereto agrees that service of process in any such action, suit or proceeding against it with respect to this Agreement may be made upon it in any manner permitted by the laws of the State of Delaware or the federal laws of the United States or as follows: (i) by personal service or by certified or registered mail to the party’s designated agent for such service in such state, or (ii) by certified or registered mail to the party at its address set forth in Schedule 13.2 herein. Service of process in any manner referred to in the preceding sentence shall be deemed, in every respect, effective service of process upon such party.

     13.10 Binding Effect. Subject to the provisions of this Agreement relating to transferability, this Agreement shall be binding upon, and inure to the benefit of, the Partners and their respective permitted distributees, heirs, successors and assigns.

     13.11 Additional Documents and Acts. Each Partner agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms,

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provisions, and conditions of this Agreement and of the transactions contemplated hereby.

     13.12 No Third Party Beneficiary. This Agreement is made solely for the benefit of the parties hereto and their permitted distributees, heirs, successors and assigns and no other person shall have any rights, interest, or claims hereunder or otherwise be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise.

     13.13 Waiver of Jury Trial. Each of the parties hereto hereby waives trial by jury in any action, proceeding or counterclaim brought by or against it on any matters whatsoever arising out of or in any way connected with this Agreement.

[Balance of Page Left Intentionally Blank]

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     IN WITNESS WHEREOF, each Partner has duly executed this Amended and Restated Partnership Agreement as of the date set forth above.

Gannett Texas L.P.
By:	Gannett Satellite Information Network, Inc.
	Its General Partner
By:	/s/ Daniel S. Ehrman, Jr.     Daniel S. Ehrman, Jr.
	Authorized Representative
Northwest New Mexico Publishing Company
By:	/s/ Joseph J. Lodovic, IV     Joseph J. Lodovic, IV
	Its: President

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Schedule 13.2

Addresses for Notices

Gannett

Gannett Texas L.P.
c/o Gannett Co., Inc.
7950 Jones Branch Drive
McLean, VA 22107
Attn: Daniel S. Ehrman, Jr.
Fax No.: (703) 854-2042

with a copy to:

Gannett Co., Inc.
7950 Jones Branch Drive
McLean, VA 22107
Attn: Todd A. Mayman, Esq.
Fax No.: (703) 854-2035

MediaNews

Northwest New Mexico Publishing Company
c/o MediaNews Group, Inc.
1560 Broadway, Suite 2100
Denver, CO 80202
Attn: Joseph J. Lodovic, IV, President
Fax No.: (303) 894-9327

with a copy to:

Howell E. Begle, Jr. and James Modlin
Hughes Hubbard & Reed LLP
1775 I Street, NW, Suite 600
Washington, DC 20006
Fax No.: (202) 721-4646

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Exhibit A

Form of Third Amended and Restated Partnership Agreement
Pursuant to Section 8.11

Third Amended and Restated Partnership Agreement

For

Texas-New Mexico Newspapers Partnership

A Delaware General Partnership

By and Between

Gannett Texas L.P.

And

Northwest New Mexico Publishing Company

[                    , 20___]

TABLE OF CONTENTS

ARTICLE I DEFINITIONS			2
ARTICLE II THE PARTNERSHIP			10
	2.1	Formation	10
	2.2	Name	10
	2.3	Business Purpose	10
	2.4	Registered Office and Agent	11
	2.5	Term	11
	2.6	Principal Place of Business	11
	2.7	The Partners	11
	2.8	Fiscal Year	11
	2.9	Representations and Warranties of the Parties	11
ARTICLE III CAPITAL STRUCTURE AND CONTRIBUTIONS			12
	3.1	Capital Contributions	12
	3.2	No Other Mandatory Capital Contributions	14
	3.3	No Right of Withdrawal	14
	3.4	Loans by Third Parties	14
ARTICLE IV CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES			14
	4.1	Capital Accounts	14
	4.2	Book Allocation	15
	4.3	Tax Allocations	16
ARTICLE V DISTRIBUTIONS			17
	5.1	Distributions	17
ARTICLE VI ACCOUNTING AND REPORTS			17
	6.1	Books and Records	17
	6.2	Reports to Partners	18
	6.3	Annual Tax Returns	18
	6.4	Actions in Event of Audit	19
	6.5	Tax Elections	19
ARTICLE VII ACTIONS BY PARTNERS			20
	7.1	Meetings	20
	7.2	Actions by the Partners	20
ARTICLE VIII MANAGEMENT			20
	8.1	The Management Committee	20
	8.2	Removal of Members; Vacancies	23
	8.3	Meetings of the Management Committee; Notice	23
	8.4	Quorum	23
	8.5	Voting	24
	8.6	Certain Matters Requiring a Unanimous Vote of the Management Committee	24
	8.7	Action by Consent	25
	8.8	Executive Officers	25

	8.9	Provision of Services to Partnership by MediaNews	26
	8.10	Partnership Change in Control	27
ARTICLE IX TRANSFER OF PARTNERSHIP INTERESTS; ADDITIONAL AND SUBSTITUTE PARTNERS			28
	9.1	Prohibited Transfers	28
	9.2	Permitted Transfers by Partners	28
	9.3	Substitute Partner	28
	9.4	Involuntary Withdrawal by a Partner	29
	9.5	Right of First Refusal for Sale of Partnership Interests	29
	9.6	Tag-Along Rights Regarding Sales of Partnership Interests	31
	9.7	Admission of Additional Partners	32
	9.8	Acknowledgment of Pledge of Interests	32
	9.9	Rights of First Refusal with Respect to Certain Assets Offered to the Partners	33
ARTICLE X DISSOLUTION AND LIQUIDATION			33
	10.1	Dissolution	33
	10.2	Election to Continue the Business	34
	10.3	Closing of Affairs	35
	10.4	Liquidator of the Partnership; In Kind Distribution of Newspapers	36
ARTICLE XI AMENDMENT TO AGREEMENT			37
ARTICLE XII INDEMNIFICATION			37
	12.1	General	37
	12.2	Indemnification Obligations	37
	12.3	Exclusive Remedy	40
	12.4	Third Party Claims	40
	12.5	Other Indemnification Claims	41
ARTICLE XIII GENERAL PROVISIONS			42
	13.1	Mediation	42
	13.2	Notices	42
	13.3	Confidentiality	43
	13.4	Entire Agreement, Etc	43
	13.5	Construction Principles	43
	13.6	Counterparts	44
	13.7	Severability	44
	13.8	Expenses	44
	13.9	Governing Law and Venue	44
	13.10	Binding Effect	45
	13.11	Additional Documents and Acts	45
	13.12	No Third Party Beneficiary	45
	13.13	Waiver of Jury Trial	45

2

THIRD AMENDED AND RESTATED PARTNERSHIP AGREEMENT

FOR

TEXAS-NEW MEXICO NEWSPAPERS PARTNERSHIP

A DELAWARE GENERAL PARTNERSHIP

     THIS THIRD AMENDED AND RESTATED PARTNERSHIP AGREEMENT of Texas-New Mexico Newspapers Partnership, a Delaware general partnership (the “Partnership”), is effective as of the Effective Date (as defined below) by and among Gannett Texas L.P., a Delaware limited partnership (“Gannett”), and Northwest New Mexico Publishing Company, a Delaware Corporation (“MediaNews”), and each other individual or business entity who may hereafter be admitted from time to time as a Partner hereunder. Gannett and MediaNews and any other individual and/or business entity subsequently admitted shall be known as and referred to as “Partners” and individually as a “Partner”.

RECITALS

     WHEREAS, the Partnership was formed as a general partnership under the laws of the State of Delaware on March 17, 2003;

     WHEREAS, the Partnership Agreement entered into by and among Gannett Texas L.P. and New Mexico-Texas MediaNews LLC dated as of March 17, 2003 was amended and restated by the parties as of March 21, 2003 (the “Partnership Agreement”);

     WHEREAS, the Partnership Agreement was amended and restated by Gannett Texas L.P. and TNP Publishing, LLC, a Delaware limited liability company as successor-in-interest to New Mexico-Texas MediaNews, LLC as of December 25, 2005 (the “Amended and Restated Partnership Agreement”);

     WHEREAS the Amended and Restated Partnership Agreement was amended and restated by Gannett Texas L.P. and Northwest New Mexico Publishing Company as successor-in-interest to TNP Publishing, LLC as of July ___, 2006 (the “Second Amended and Restated Partnership Agreement”);

     WHEREAS, on [                    ,___], Gannett received written notice from MNG (as defined below) of a proposed MediaNews Change in Control (as defined below) that either the stockholders or board of directors of MNG intended to accept (the “MNG Notice”);

     WHEREAS, Gannett has exercised its option under Section 8.11(a) of the Second Amended and Restated Partnership Agreement, by giving written notice to MediaNews on [                    ,___], to assume sole authority for the operation and management of the Gannett Designated Newspapers (as defined below) and, as a result thereof, MediaNews has assumed sole authority for the operation and management of the MediaNews Newspapers (as defined below), in each case from and after the Effective Date and pursuant to the terms and conditions of this Agreement; and

     WHEREAS, pursuant to Section 8.11(a) of the Second Amended and Restated Partnership Agreement, the Partners have executed and delivered this Agreement;

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter expressed, the Partners agree as follows:

ARTICLE I
DEFINITIONS

     “Act” means the Delaware Revised Uniform Partnership Act, as amended.

     “Additional Capital Contributions” means any additional Capital Contributions made pursuant to Section 3.1(b) of this Agreement.

     “Additional Contribution Terms” shall have the meaning ascribed to it in Section 3.1(b) of this Agreement.

     “Additional Partner” means any additional person admitted to the Partnership, pursuant to Section 9.7 of this Agreement, but does not include a Substitute Partner.

     “Affiliate” means any person controlled by, controlling, or under common control with the entity in question.

     “Agreement” means this Third Amended and Restated Partnership Agreement of the Partnership dated [                    ,___].

     “Available Funds” means with respect to any year or other applicable period, all cash received by the Partnership (including from Capital Contributions, proceeds of any disposition of Partnership property, loans to the Partnership, and all Partnership operating income) less all disbursements of cash, including payments of operating expenses, including payments in reduction of Partnership indebtedness and allocations to reasonable reserve accounts as were established with respect to such year or other applicable period pursuant to the Business Plan for such year or, as necessary, to provide for a material contingency which arises, or facts and circumstances which first arose, after the date of the Business Plan, all as reasonably determined by the Management Committee. Partnership expenses shall include those customarily considered expenses under cash basis accounting practices, except that the following adjustments shall be made: (i) depreciation shall not be included as an expense; (ii) the entire amount of prepaid expenses shall be included as an expense in the year paid; (iii)

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funds expended for capital improvements or replacements shall be included as an expense in the year paid; and (iv) taxes collected on behalf of governmental entities and paid over to the entities shall not be included in expenses or receipts. If the Management Committee determines that the reserves of the Partnership exceed the amount it deems sufficient for the operation of the Partnership’s business, it shall reduce the reserves to such levels as are deemed appropriate in the reasonable commercial judgment of the Management Committee. Any amount released from such reserves as aforesaid shall be added to Available Funds. Within ten (10) days of the end of each month, the Management Committee shall issue a detailed report to the Partners setting forth the calculations of Available Funds for such preceding month.

     “Book Value” means, with respect to any asset of the Partnership, the adjusted basis of such asset as of the relevant date for federal income tax purposes, except as follows:

          (i) the initial Book Value of any asset contributed by a Partner to the Partnership shall be the fair market value of such asset;

          (ii) the Book Values of all Partnership assets (including intangible assets such as goodwill) shall be adjusted to equal their respective fair market values as of the following times:

               (A) the acquisition of an additional Interest in the Partnership by any new or existing Partner in exchange for more than a de minimis Capital Contribution;

               (B) the distribution by the Partnership to a Partner of more than a de minimis amount of money or Partnership property as consideration for an Interest in the Partnership; and

               (C) the liquidation of the Partnership within the meaning of Regulation section 1.704-1(b)(2) (iv)(f)(5)(ii);

          (iii) the Book Value of the Partnership assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code section 734(b) or Code section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulation section 1.704-1(b)(2)(iv)(m); and

          (iv) if the Book Value of an asset has been determined or adjusted pursuant to subsection (i), (ii) or (iii) above, such Book Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses and other items allocated pursuant to Section 4.2.

     The foregoing definition of Book Value is intended to comply with the provisions of Regulation section 1.704–1(b)(2)(iv) and shall be interpreted and applied consistently therewith.

     “Business Day” means any day (other than a day which is a Saturday, Sunday or legal holiday for the United States government).

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     “Business Plans” means an annual operating budget (including estimated capital expenditure requirements) covering the next succeeding fiscal year, or portion of the fiscal year following the Effective Date, with respect to the Gannett Designated Newspapers and the MediaNews Newspapers, prepared pursuant to Section 8.1.

     “Capital Account” means, for each Partner, the capital account maintained by the Partnership for such Partner as described in Section 4.1.

     “Capital Contribution” means the amount of money and the other property (net of any liabilities that the Partnership is considered to assume, or take subject to, pursuant to Code Section 752, except to the extent such liabilities are in fact discharged by the Partners contributing such property) which is contributed by a Partner to the Partnership pursuant to Article III hereof, including Additional Capital Contributions.

     “Capital Expenditure” means all expenditures of a capital nature, including those in relation to the construction of enlargements or additions to any of the assets or facilities owned by the Partnership or York Limited Partnership or for any other acquisitions or improvements thereto of a capital nature, including, without limitation, expenditures for materials, labor, equipment permits, consulting fees, accounting and legal fees, insurance costs, contractors’ fees, and land and easement costs.

     “Chairman” is defined in Section 8.1(a).

     “CNP” means California Newspapers Partnership, a Delaware general partnership, its successors and assigns.

     “CNP Contribution Date” means the date of the Gannett CNP Contribution.

     “CNP EBITDA” means EBITDA of CNP.

     “CNP Partnership Agreement” means the Partnership Agreement for California Newspapers Partnership, a Delaware general partnership, dated July ___, 2006, by and among West Coast MediaNews LLC, Donrey Newspapers LLC, The Sun Company of San Bernardino, California, California Newspapers, Inc., Media West SBC, Inc., and Media West-CNI, Inc.

     “Code” means the Internal Revenue Code of 1986, as amended.

     “Contribution Agreement” means those contribution agreements described in Section 3.1 of the Agreement.

     “Depreciation” means, for each Fiscal Year or part thereof, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such Fiscal Year or part thereof, except that if the Book Value of an asset differs from its adjusted basis for federal income tax purposes, the depreciation, amortization or other cost recovery deduction for such Fiscal Year or part thereof shall be an amount which bears the same ratio to such Book Value as the federal income tax depreciation, amortization or other cost recovery

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deduction for such Fiscal Year or part thereof bears to such adjusted tax basis. If such asset has a zero adjusted tax basis, the depreciation, amortization or other cost recovery deduction for each Fiscal Year shall be determined under a method reasonably selected by the Tax Matters Partner.

     “Dissolution Committee” means the committee established pursuant to Section 10.4 hereof to serve as the liquidator of the Partnership and to manage the dissolution of the Partnership.

     “Dissolution Notice” means the notice given by an Electing Partner pursuant to Section 10.1(a)(ii), the notice to dissolve the Partnership given by Gannett or MediaNews pursuant to Section 10.1(a)(iii) or any other written notice of a Dissolution Event received by the Partnership from a Partner pursuant to Article X of this Agreement.

     “EBITDA” means, with respect to any entity, the sum of (i) net income after taxes, plus (ii) interest expense that has been deducted in the determination of such net income, plus (iii) federal, state and local income taxes that have been deducted in determining such net income, plus (iv) depreciation and amortization expenses that have been deducted in determining such net income, in each case for the 12-month period ended immediately prior to the date of such determination, and determined on a basis consistent with GAAP, consistently applied.

     “Effective Date” means the next Business Day following the day on which the MediaNews Change in Control referenced in the MNG Notice has been consummated; provided, however, that any right of MediaNews to exercise any drag-along rights pursuant to Section 9.7 of the Second Amended and Restated Partnership Agreement shall be suspended from and after the date of the MNG Notice until either (i) such proposed transaction is consummated (in which event, such rights are automatically terminated pursuant to this Agreement) or (ii) MNG has confirmed in writing to Gannett that such proposed transaction will not be consummated and that the MNG Notice has been revoked (in which event, this Agreement shall be null and void and of no further force or effect).

     “Election Period” means either (i) the Transition Period plus 30 days thereafter, if the MNG Notice is received by Gannett during the Transition Period (and such MNG Notice has not been revoked by MNG), provided that Gannett shall have the right, exercisable in its sole discretion upon notice to the other Partners, to extend the Election Period until a date specified by Gannett occurring at any time during the fiscal year of Gannett Co., Inc. in which the Transition Period expires or the next succeeding fiscal year of Gannett Co., Inc.; or (ii) 30 days following receipt by Gannett of the MNG Notice, if the MNG Notice (which has not been revoked by MNG) is received by Gannett after the expiration of the Transition Period, provided that Gannett shall have the right, exercisable in its sole discretion upon notice to the other Partners, to extend the Election Period until a date specified by Gannett occurring at any time (A) during the fiscal year of Gannett Co., Inc. in which the MNG Notice is received by Gannett, or (B) during the next succeeding fiscal year of Gannett Co., Inc. In the case of either clause

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(i) or (ii) above, the Election Period shall automatically be extended by one day for each day which elapses during the period commencing on the date of the MNG Notice and continuing until the Effective Date.

     “Fair Market Value of the Offered Interest” is defined in Section 9.5(f)(ii).

     “Fiscal Year” means the fiscal year of the Partnership as defined in Section 2.8 hereof.

     “Formation Date” is defined in Section 2.5 of this Agreement.

     “GAAP” means United States generally accepted accounting principles, as in effect from time to time.

     “Gannett” means Gannett Texas L.P., a Delaware limited partnership, its successors and assigns.

     “Gannett Claim Notice” is defined in Section 12.2 of this Agreement.

     “Gannett CNP Contribution” means the contribution of the Gannett CNP Interest to the Partnership pursuant to Section 3.1(e).

     “Gannett CNP EBITDA” means the product of CNP EBITDA multiplied by the percentage interest in CNP represented by the Gannett CNP Interest.

     “Gannett CNP Interest” means the entire beneficial ownership interest of Gannett Co., Inc. and its Affiliates in CNP and its property on the CNP Contribution Date.

     “Gannett Designated Newspapers” means all of the assets used, held for use in, located at the premises of, or shown on the financial statements of the newspapers set forth on Schedule 1.1 (a) attached hereto. The assets eligible for selection by Gannett as Gannett Designated Newspapers may include, but not be limited to, (i) all of the types of Gannett Assets and/or MediaNews Assets (in each case, as defined in the Contribution Agreement), as the case may be, and the related current liabilities, associated with such newspapers; and/or (ii) if Gannett has made or committed to make the Gannett CNP Contribution, the Gannett CNP Interest (and, for the purpose of this Agreement, all of the newspapers which at any time are owned by CNP shall be deemed to be located in the geographic region).

     “Gannett Election Notice” means written notice from Gannett to MediaNews of its intention to contribute (or cause to be contributed) the Gannett CNP Interest to the Partnership pursuant to Section 3.1(e), which notice shall specify the date upon which such contribution shall become effective for all purposes of this Agreement.

     “Gannett TNP EBITDA” means the Percentage Interest of Gannett and its Affiliates in the Partnership at the date of determination, multiplied by TNP EBITDA.

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     “GANSAT” means Gannett Satellite Information Network, Inc., a Delaware corporation, its successors and assigns.

     “Indebtedness” means those obligations for borrowed money which were assumed by the Partnership as a consequence of, or to which property of the Partnership was subject immediately following the Partner’s initial Capital Contributions (within the meaning of Section 3.1(a) hereof), with the exception of any of the foregoing such obligations which are included in the Working Capital Statements (as defined in the Contribution Agreement).

     “Interest” means, with respect to any Partner at any time, such Partner’s entire beneficial ownership interest in the Partnership and its property at such time, including such Partner’s Capital Account, voting rights (if any), and right to share in Profits and Losses, all items of income, gain, loss, deduction and credit, distributions and all other benefits of the Partnership as specified in this Agreement, together with such Partner’s obligations to comply with all of the terms of this Agreement.

     “Involuntary Transfer” shall have the meaning ascribed thereto in Section 9.4.

     “Majority” means the Partners having a majority of the Percentage Interests.

     “MediaNews” means Northwest New Mexico Publishing Company, a Delaware corporation, its successors and assigns.

     “MediaNews Change in Control” means the occurrence of any transaction or series of transactions as a result of which (i) MNG and Permitted Holders no longer directly or indirectly hold in the aggregate more than 50% of the voting interests of each of TNP Publishing, LLC, Northwest New Mexico Publishing Company and MediaNews Group Interactive, Inc., their successors and assigns, including any Affiliate which on or after the date hereof holds any Interest in the Partnership, or (ii) the sale or other disposition of all or substantially all of the assets of MNG or any of its Affiliates listed in clause (i) except for sales or other dispositions to MNG or any of its Affiliates and/or Permitted Holders, or (iii) a majority of the voting interests of MNG are acquired by a person or entity (or group of persons and entities acting in concert), whether structured as a merger, consolidation, reorganization, sale of stock or otherwise, other than Permitted Holders, in each case of clauses (i) or (ii), without the prior written consent of Gannett, not to be unreasonably withheld. No such approval shall be deemed to have been withheld unreasonably if the proposed transferee (or those controlling the proposed transferee) does not have experience in and a good reputation within the newspaper publishing industry.

     “MediaNews Newspapers” means all of the assets used, held for use in, located at the premises of, or shown on the financial statements of the newspapers set forth on Schedule 1.1 (b) attached hereto. The MediaNews Newspapers may include, but not be limited to (i) all of the types of Gannett Assets and/or MediaNews Assets (in each case, as defined in the Contribution Agreement), as the case may be, and the related current liabilities, associated with such newspapers; and/or (ii) the Gannett CNP Interest,

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provided that Gannett has made or committed to make the Gannett CNP Contribution and the Gannett CNP Interest is not a Gannett Designated Newspaper.

     “MNG” means MediaNews Group, Inc., a Delaware corporation, its successors and assigns.

     “MNG Notice” is defined in the recitals.

     “Partnership Change in Control” means (i) any occurrence whereby the Percentage Interests directly or indirectly owned by MNG and its Affiliates and Permitted Holders become less than fifty percent (50%) of the total Percentage Interest of all Partners, after giving effect to any reduction in MediaNews’ Percentage Interest occasioned by Gannett’s availing itself of the remedy set forth in Section 12.2 of this Agreement and any additional capital contribution of newspaper assets by MediaNews pursuant to Section 12.2, or (ii) any pledgee, collateral assignee or Transferee (other than MNG and its Affiliates) of all or any portion of the Interest of MNG and its Affiliates, without the prior written consent of Gannett, seeks to be admitted as a Substitute Partner or to exercise any voting rights or other powers granted to MediaNews (including with respect to members of the Management Committee appointed by MediaNews) in this Agreement, or (iii) the occurrence of the Gannett CNP Contribution.

     “Percentage Interest” means, for each Partner, such Partner’s percentage interest as set forth in Section 3.1 hereof as such may be adjusted from time to time in accordance with this Agreement.

     “Permitted Holders” means (i) each of William Dean Singleton, Richard B. Scudder, Joseph J. Lodovic, IV and their respective spouses, ancestors, siblings, descendants (including children or grandchildren by adoption) and the descendants of any of their siblings; (ii) in the event of the incompetence or death of any of the persons described in clause (i), such person’s estate, executor, administrator, committee or other personal representative, in each case who at any particular date shall beneficially own or have the right to acquire, directly or indirectly, capital stock of MNG; (iii) any trust created for the benefit of the persons described in clause (i) or (ii) or any trust for the benefit of any such trust; or (iv) any person controlled by any of the persons described in clause (i), (ii) or (iii). For purposes of this definition, “control,” as used with respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, whether through ownership of voting securities or by contract or otherwise.

     “Profits” and “Losses” means, for each Fiscal Year or part thereof, the taxable income or loss of the Partnership for such Fiscal Year determined in accordance with Code section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code section 703(a)(1) shall be included in taxable income or loss), with the following adjustments:

          (i) any income of the Partnership that is exempt from federal income tax shall be added to such taxable income or loss;

8

          (ii) any expenditures of the Partnership described in Code section 705(a)(2)(B) or treated as such pursuant to Regulation section 1.704-1(b)(2)(iv)(i) shall be subtracted from such taxable income or loss;

          (iii) any Depreciation for such Fiscal Year or part thereof shall be taken into account in lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss;

          (iv) gain or loss resulting from any disposition of Partnership property with respect to which gain or loss is recognized for federal income tax purposes shall be computed with reference to the Book Value of the property disposed of, rather than the adjusted tax basis of such property;

          (v) in the event the Book Value of any Partnership asset is adjusted pursuant to section (ii) or (iii) of the definition of Book Value hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such assets for purposes of computing Profits and Losses; and

          (vi) such taxable income or loss shall be deemed not to include any income, gain, loss, deduction or other item thereof allocated pursuant to Section 4.3.

     “Regulations” means the income tax regulations promulgated under the Code by the Department of the Treasury, as such regulations may be amended from time to time.

     “Substitute Partner” means a person who has become a substitute Partner pursuant to Section 9.3 hereof, but does not include an Additional Partner.

     “TNP EBITDA” means EBITDA of the Partnership.

     “Transfer” means any sale, assignment, gift, alienation, or other disposition, whether voluntary or by operation of law (other than a transfer which may arise by reason of death or incapacity), of an interest or any portion thereof, but shall not include any pledge, hypothecation or granting of a security interest in such Interest.

     “Transferee” means a purchaser, transferee, assignee (other than any secured party, pledgee or collateral assignee) or any other person who takes, in accordance with the terms of this Agreement, an Interest in the Partnership.

     “Transition Period” means the period commencing on the date of this Agreement and ending on June 30, 2010.

     “Transitional Services Agreement” means a certain agreement among Gannett, GANSAT, MNG and the Partnership dated as of December 25, 2005.

     “York Indemnity Claim” is defined in Section 12.2 of this Agreement.

     “York Joint Operating Agreement” means the Amended and Restated Joint Operating Agreement, dated as of April 30, 2004, by and among York Newspapers, Inc., York Newspapers Holdings, Inc., York Limited Partnership and York Dispatch Publishing Company, LLC.

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     “York Limited Partnership Agreement” means the Limited Partnership Agreement, dated as of April 30, 2004, by and among York Newspapers, Inc., York Newspapers Holdings, Inc. and York Dispatch Publishing Company, LLC.

     “York Limited Partnership” means York Newspapers Holdings, L.P., a Delaware limited partnership, its successors and assigns, and its subsidiaries, The York Newspaper Company, a Pennsylvania general partnership, York Newspapers Holdings, LLC, York Dispatch LLC and York Daily Record – York Sunday News LLC, their successors and assigns.

     “York LLC” means York Partnership Holdings LLC, a Delaware limited liability company, its successors and assigns. As of the date hereof, York LLC is a wholly-owned subsidiary of the Partnership and the sole general partner of York Limited Partnership. Northwest New Mexico Publishing Company, successor to Pennsylvania Newspapers Publishing, Inc., is the sole manager of York LLC.

     “York Partnership Interest” has the same meaning as defined in Section 2.5(a) of the Contribution Agreement.

ARTICLE II
THE PARTNERSHIP

     2.1 Formation. The parties hereto have formed a partnership in accordance with the further terms and provisions hereof. Each of the Partners shall execute or cause to be executed from time to time all other instruments, certificates, notices and documents, and shall do or cause to be done all such filing, recording, publishing and other acts, in each case, as may be necessary or appropriate from time to time to comply with all applicable requirements for the formation and/or operation and, when appropriate, termination of a partnership in the State of Delaware and all other jurisdictions where the Partnership shall desire to conduct its business.

     2.2 Name. The name of the Partnership shall be “Texas-New Mexico Newspapers Partnership” and its business shall be carried on in this name with such variations and changes as the Management Committee, in its sole judgment, deems necessary or appropriate to comply with the requirements of the jurisdictions in which the Partnership’s operations are conducted.

     2.3 Business Purpose. The purpose of the Partnership is to carry on any lawful business and to engage in any lawful act or activity for which a partnership may be formed under the laws of the State of Delaware; provided, however, that the business of the Partnership shall, without the unanimous consent of the Management Committee, be limited to activities involving the ownership, operation, and publication (in printed and electronic form) of newspapers and related publications and business activities directly related or incidental to such ownership, operation and publication including, without limitation, commercial printing, alternate distribution services and direct mail activities.

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     2.4 Registered Office and Agent. The registered office of the Partnership in the State of Delaware and its registered agent for service of process on the Partnership in the State of Delaware shall be as determined by the Management Committee.

     2.5 Term. The term of the Partnership commenced on March 17, 2003 (the “Formation Date”) and shall continue until December 31, 2053 unless earlier dissolved and liquidated in accordance with Article X hereof.

     2.6 Principal Place of Business. The Partnership shall maintain its principal place of business at 1560 Broadway, Suite 2100, Denver, Colorado 80202, or such other location or locations as the Management Committee may from time to time select.

     2.7 The Partners. The name and place of residence of each Partner is as follows:

NAME	RESIDENCE
Gannett Texas L.P.	c/o Gannett Co., Inc.
	7950 Jones Branch Drive
	McLean, VA 22107
TNP Publishing, LLC	c/o MediaNews Group, Inc,
	1560 Broadway, Suite 2100
	Denver, CO 80202

     2.8 Fiscal Year. Unless the Tax Matters Partner shall otherwise determine in accordance with Section 706 of the Code, the fiscal year of the Partnership shall end on June 30^th of each calendar year.

     2.9 Representations and Warranties of the Parties. Each of the parties represents and warrants that:

          (a) It is a limited partnership, limited liability company or corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization;

          (b) It has all requisite power and authority to enter into this Agreement; the execution and delivery by such party of this Agreement and the consummation by such party of the transactions contemplated hereby have been duly authorized by all necessary partnership or corporate action on the part of such party; and this Agreement has been duly and validly executed and delivered by such party and constitutes (assuming the due and valid execution and delivery of this Agreement by the other parties), the legal, valid and binding obligation of each party, enforceable against each party in accordance with its terms;

          (d) The execution, delivery and performance by such party of this Agreement will not, as of and after the date of this Agreement, result in a breach of any of the terms, provisions or conditions of any agreement to which such party is a party

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which has a reasonable likelihood of materially and adversely affecting the operations, properties or business of the Partnership or such party’s obligations under this Agreement; and

          (e) The execution and delivery by such party of this Agreement and the formation of the Partnership does not require any filing by it with, or approval or consent of, any governmental authority which has not already been made.

ARTICLE III
CAPITAL STRUCTURE AND CONTRIBUTIONS

     3.1 Capital Contributions.

          (a) Initial Contributions. Each of Gannett and MediaNews has made (or caused to be made) a Capital Contribution to the Partnership as set forth in a contribution agreement among Gannett, Las Cruces Publishing Company, Northwest New Mexico Publishing Company, Carlsbad Publishing Company, and New Mexico – Texas MediaNews Group Interactive, Inc. and dated as of March 14, 2003 (the “Contribution Agreement”). Each of Gannett and MediaNews has made (or will cause to be made) a Capital Contribution to the Partnership as set forth in a contribution agreement among Gannett, MediaNews, Pennsylvania Newspapers Publishing Inc., MediaNews Group Interactive, Inc., MediaNews Group, Inc., TNP Publishing, LLC and the Partnership and dated as of November 30, 2005 (also, for purposes of this Agreement, the “Contribution Agreement”). As a result of such Capital Contributions, effective as of December 25, 2005, Gannett has (or will have) a Percentage Interest in the Partnership of 40.64%, and MediaNews has (or will have) a Percentage Interest in the Partnership of 59.36%. Except as specified in Section 3.1(e), Percentage Interests shall not be adjusted on account of the payment of any sums, or the contribution of any property, treated as a Capital Contribution without the unanimous consent of the Partners.

          (b) Additional Capital Contributions; Interest; and Offset. At any time, and from time to time after the Formation Date, the Management Committee, in its sole and absolute discretion, by unanimous vote, may determine that the Partnership requires additional capital contributions (the “Additional Capital Contributions”) and the amount, terms and conditions thereof. Such Additional Capital Contributions will be used by the Partnership for such activities as are designated by the Management Committee in its approval resolution. All Additional Capital Contributions will be made by the Partners in proportion to their then-current Percentage Interests in the Partnership. In addition, with the unanimous consent of the Management Committee, Additional Capital Contributions may be obtained by the admittance of Additional Partners in accordance with Section 9.8. In the event Additional Partners are admitted, the Percentage Interests of the existing and Additional Partners shall be adjusted as determined by the Management Committee, voting unanimously. From the date of the Management Committee’s determination that an Additional Capital Contribution is required until it has been paid, a Partner’s obligation to make that contribution shall accrue interest at a rate of 9% per annum until the obligation to make the Additional Capital Contribution (and to pay all accrued but unpaid interest, if any, with respect

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thereto) has been paid in full. All cash distributions to which such Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such Additional Capital Contribution (and to pay all accrued but unpaid interest, if any, with respect thereto). Any amounts so retained shall be treated as distributed to such Partner and, first paid to the Partnership in the amount of the accrued interest and, second, with respect to the remainder thereof, contributed to the Partnership as an Additional Capital Contribution on behalf of the Partner owing such obligation.

          (c) Capital Contributions Required Under Section 12.2; Interest; and Offset. As provided in Section 12.2 of this Agreement, any Partner owing an indemnification obligation to the Partnership arising under Article XII of this Agreement shall make a capital contribution in cash or other immediately available funds in the amount of such obligation promptly upon the determination of such obligation. Furthermore, from the date of the determination of such obligation until the date such capital contribution is made in cash or other immediately available funds, the amount of such obligation shall accrue interest owing to the Partnership at a rate of 9 per cent per annum, and until such obligation (and all accrued interest, if any, with respect thereto) has been paid in full in cash or other immediately available funds, all cash distributions to which a Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such capital contribution and to pay accrued but unpaid interest. Any amounts so retained shall be treated as distributed to such Partner and, first paid to the Partnership in the amount of the accrued interest and, second, with respect to the remainder thereof, contributed to the Partnership as an additional capital contribution on behalf of the Partner owing such obligation.

          (d) Other Contributions. At any time during the term of this Agreement, any Partner may offer to contribute to the Partnership as an additional capital contribution any newspapers, mastheads or related assets owned by it that are located in the State of Texas, the State of New Mexico or the Commonwealth of Pennsylvania. Should the Management Committee, by a unanimous vote, agree to accept such contribution, the Capital Account and, if determined by unanimous vote of the Management Committee, as provided in Section 8.6 hereof, the Percentage Interest, of the contributing Partner will be adjusted upward to reflect the fair market value of such contribution (determined in accordance with the procedures set forth in Section 9.5(f)) and, if determined by unanimous vote of the Management Committee, as provided in Section 8.6 hereof, the Percentage Interest of the other Partners will be adjusted downward proportionately to reflect the increase in the contributing Partner’s Percentage Interest.

          (e) Contribution of Gannett CNP Interest; Increase of Percentage Interest. Following receipt of any MNG Notice by Gannett, and during the Election Period, Gannett shall have the right (but not the obligation) to elect to contribute (or cause to be contributed) all of the Gannett CNP Interest to the Partnership, without obtaining the consent of the Partnership or any other Partner, by sending the Gannett Election Notice in accordance with Section 13.2. Any such contribution to the Partnership shall become effective upon the closing date during the Election Period

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specified by Gannett in the Gannett Election Notice, and the Partnership shall be admitted as a substitute partner of CNP on such closing date; provided, however, that such contribution shall not become effective unless and until the consummation of the proposed MediaNews Change in Control referenced in the MNG Notice. Effective as of the CNP Contribution Date, Gannett and its Affiliates’ Percentage Interest will be increased to the quotient (expressed as a percentage) of (i) the sum of Gannett CNP EBITDA, plus Gannett TNP EBITDA, divided by (ii) the sum of TNP EBITDA plus Gannett CNP EBITDA.

     3.2 No Other Mandatory Capital Contributions. Except as specified in Section 3.1(b), Section 3.1(c) or Section 12.2, no Partner shall be obligated to make any Additional Capital Contribution to the Partnership’s capital.

     3.3 No Right of Withdrawal. No Partner shall have the right to withdraw any portion of such Partner’s Capital Contributions to, or to receive any distributions from, the Partnership, except as provided in Articles V, IX and X hereof.

     3.4 Loans by Third Parties. Subject to the provisions of Section 8.6 hereof, the Partnership may borrow funds or enter into other similar credit, guarantee, financing or refinancing arrangements for any purpose from any Partner or from any person upon such terms as the Management Committee determines, in its sole and absolute discretion, are appropriate.

ARTICLE IV
CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES

     4.1 Capital Accounts. Each Partner shall have a capital account (a “Capital Account”) which account shall be (1) increased by the amount of (a) the Capital Contributions of such Partner, (b) the allocations to such Partner of Profits and items of income or gain pursuant to Section 4.2, and (c) any positive adjustment to such Capital Account by reason of an adjustment to the Book Value of Partnership assets, and (2) decreased by the amount of (x) any cash and the Book Value of any property (net of liabilities secured by such property that such Partner is considered to assume or take subject to under Code section 752) distributed to such Partner, (y) the allocation to such Partner of Losses and items of loss pursuant to Section 4.2, and (z) any negative adjustment to such Capital Account by reason of an adjustment to the Book Value of Partnership assets. In the event of a revaluation of the Book Value of Partnership assets, the Partners’ Capital Accounts shall be adjusted in the same manner as if gain or loss had been recognized on a sale of the assets at their new Book Value. The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulation section 1.704-1(b), and shall be interpreted and applied in a manner consistent with such Regulation.

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     4.2 Book Allocation.

          (a) In General. This Section 4.2 sets forth the general rules for book allocations of Profits, Losses and similar items to the Partners as reflected in their Capital Accounts.

          (b) Profits and Losses. Profits shall be allocated to the Partners in proportion to their Percentage Interests. Losses shall be allocated to the Partners in proportion to their Percentage Interests except that any interest expense or other deduction attributable to any Indebtedness (other than any depreciation or amortization deductions attributable to property which is contributed to the Partnership subject to such Indebtedness) and any deductions attributable to any indemnity payments described in Section 12.2 shall be allocated to the Partner that contributed property subject to such Indebtedness or such indemnity payment.

          (c) Special Rules.

               (i) Notwithstanding the general allocation rules set forth in Section 4.2(b), in the case of any deduction allocable to a “nonrecourse liability” (as that term is defined in Regulations Section 1.704-2(b)(3)) and any deduction allocable to a “partner nonrecourse liability” (as that term is defined in Regulations Section 1.704-2(b)(4)), and any minimum gain or partner minimum gain chargeback with respect thereto, shall be subject to the rules applicable thereto and described in Regulations Section 1.704-2.

               (ii) If in the opinion of independent tax counsel for the Partnership, it is necessary to provide special allocation rules in order to avoid a significant risk that a material portion of any allocation set forth in this Article IV would not be respected for federal income tax purposes, the Partners shall negotiate in good faith any amendments to this Agreement as, in the opinion of such counsel, are necessary or desirable, taking into account the interests of the Partners as a whole and all other relevant factors, to avoid or reduce significantly such risk to the extent possible without materially changing the amounts allocable and distributable to any Partner pursuant to this Agreement.

               (iii) If there is a change made, by unanimous vote of the Management Committee in accordance with the provisions of Section 8.6 hereof, in any Partner’s share of the Profits, Losses or other items of the Partnership during any Fiscal Year, allocations among the Partners shall be made in accordance with their interests in the Partnership from time to time during such Fiscal Year in accordance with Code section 706, using the closing-of-the-books method, except that Depreciation with respect to assets not contributed by a Partner shall be deemed to accrue ratably on a daily basis over the entire Fiscal Year during which the corresponding asset is owned by the Partnership.

               (iv) Except as otherwise provided in Sections 4.2(b) and 4.3(b)(i), each item of income, gain, loss, and deduction and all items governed by Code section 702(a) shall be allocated among the Partners in proportion to the allocation of Profits, Losses and other items to the Partners hereunder, provided that to the extent any gain recognized from any disposition of a Partnership asset is treated as ordinary

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income because it is attributable to the recapture of any depreciation or amortization, such ordinary income shall be allocated among the Partners in the same ratio as the prior allocations of Profits, Losses or other items that included such depreciation or amortization; in no event, however, shall any Partner be allocated ordinary income hereunder in excess of the gain otherwise allocable to each Partner.

     4.3 Tax Allocations.

          (a) In General. Except as set forth in Section 4.3(b), allocations for tax purposes of items of Profit, Loss and other items of income, gain, loss, deduction, credit and distribution therefor, shall be made in the same manner as allocations for book purposes set forth in Section 4.2. All such allocations pursuant to Section 4.3(b) shall be considered made solely for purposes of federal, state and local income taxes, and shall not affect or in any way be taken into account in computing any Partner’s Capital Account or share of Profits, Losses, other items or gain, deduction and distribution pursuant to any provision of this Agreement.

          (b) Special Rules.

               (i) Elimination of Book/Tax Disparities. In determining a Partner’s allocable share of Partnership taxable income, the Partner’s allocable share of each item of Profits and Losses shall be properly adjusted to reflect the difference between such Partner’s share of the adjusted tax basis and the Book Value of Partnership assets used in determining such item under any method adopted by the Tax Matters Partner and allowable under Code Section 704(c), provided, however, that any deductions for depreciation or amortization attributable to property contributed to the Partnership by a Partner shall be allocated to the Partner contributing such property (and, from and after the CNP Contribution Date, any similar allocations made by CNP to the Partnership pursuant to the parenthetical in Section 4.3(b)(i) of the CNP Partnership Agreement shall be allocated to Gannett and its Affiliates). In the event that the method for the allocation of depreciation or amortization deductions attributable to contributed property described in the previous sentence is disallowed, then the Tax Matters Partner shall make such compensating allocations of items including (notwithstanding the second sentence of Section 4.3(a)) such book allocations as are intended to accomplish the same economic result.

               (ii) Tax Credits. Any tax credits shall be allocated among the Partners in accordance with Regulation section 1.704-1(b)(4)(ii), unless the applicable Code provision shall otherwise require.

          (c) Conformity of Reporting. The Partners are aware of the income tax consequences of the allocations made or to be made pursuant to this Article 4 and Section 6.5 and hereby agree to be bound by the provisions of this Article 4 and Section 6.5 in reporting their shares of Partnership profits, gains, income, losses, deductions, credits and other items for income tax purposes.

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ARTICLE V
DISTRIBUTIONS

     5.1 Distributions.

          (a) The Partnership shall distribute to the Partners, not less than on a monthly basis within ten (10) days of the end of each month, all Available Funds in proportion to the Partners’ Percentage Interests, except as otherwise provided in this Agreement, including but not limited to the provisions of Sections 3.1(b) and 3.1(c) hereof relating to the Partnership’s retention of sums otherwise distributable to a Partner to discharge the obligation to make certain capital contributions and pay certain accrued but unpaid interest. Except as otherwise provided herein, all distributions shall be made in proportion to the Partners’ Percentage Interests. For the purposes of this Section 5.1(a), any payment of principal or interest by the Partnership with respect to Indebtedness shall be treated as distributed by the Partnership to the Partner that transferred the property to the Partnership to which such Indebtedness relates, and then as contributed to the Partnership by such Partner as an Additional Capital Contribution.

          (b) If a distribution of cash is deemed made pursuant to Section 3.1(b), Section 3.1(c) or the last sentence of Section 5.1(a) and, the distribution is not in proportion to the Partner’s Percentage Interest, then the Management Committee shall adjust subsequent distributions so that the cumulative distributions deemed made pursuant to Section 3.1(b), Section 3.1(c), the last sentence of Section 5.1(a) and this Section 5.1(b) are, in the aggregate, in proportion to the Partners’ Percentage Interests.

ARTICLE VI
ACCOUNTING AND REPORTS

     6.1 Books and Records.

          (a) The Partnership shall maintain or cause to be maintained at an office of the Partnership this Agreement and all amendments thereto and full and accurate books of the Partnership showing all receipts and expenditures, assets and liabilities, Profits and Losses, and all other books, records and information required by the Act as necessary for recording the Partnership’s business and affairs. The Partnership’s books and records shall be maintained in accordance with GAAP except to the extent otherwise provided hereunder for purposes of maintaining Capital Accounts in accordance with Article IV hereof and calculating the Profits or Losses charged or credited thereto. Such documents, books and records shall be maintained at such office or such designated successor office until the expiration of any applicable statutes of limitations for bringing a claim in relation to such documents, books and records.

          (b) Each Partner shall have the right at reasonable times during usual business hours to inspect the facilities of the Partnership, to observe the Partnership’s operations and to examine, audit and make copies of the books of account and other books and records of the Partnership and other books and records relating to the reserves, assets, liabilities and expenses of the Partnership; provided, however, that

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none of the foregoing activities shall be conducted in a manner that unreasonably interferes with the Partnership’s operations or business or any Partner’s management thereof. Such right may be exercised through any agent or employee of a Partner designated in writing by it or by an independent public accountant, engineer, attorney or other consultant so designated. The Partner making the request shall bear all expenses incurred in any inspection, audit or examination made at such Partner’s behest. Should any inspection, audit or examination disclose any errors or improper charges, the Management Committee shall make, or cause to be made, appropriate adjustments therefor.

     6.2 Reports to Partners.

          (a) As soon as practicable and in any event within thirty (30) days after the end of each accounting period, the Tax Matters Partner shall cause to be prepared and sent to each Partner unaudited statements of income, cash flow and changes in retained earnings and Partners’ equity, for the accounting period in question and from the beginning of such Fiscal Year to the end of such accounting period and an unaudited balance sheet as of the close of such accounting period, all of which shall (i) be prepared in accordance with GAAP (except that certain footnotes may be omitted) and (ii) set forth in each case in comparative form the figures for the same accounting period for the previous Fiscal Year.

          (b) As requested, the Tax Matters Partner shall provide to each Partner such information as may be necessary for them to comply with applicable financial reporting requirements of any competent governmental authorities or agencies or stock exchange on which the securities of any such Partner are listed including, without limitation, the U.S. Securities and Exchange Commission and such information regarding the financial position, business, properties or affairs of the Partnership as a Partner may reasonably request.

          (c) At the end of each accounting period and at the end of each Fiscal Year, the Tax Matters Partner shall prepare or cause to be prepared and sent to each Partner reports of advertising lineage, preprint distribution, circulation, cost and other statistical data in relation to the Partnership’s business during the relevant period.

     6.3 Annual Tax Returns.

          (a) Subject to Section 8.10 hereof, as of December 25, 2005, MediaNews was designated the “Tax Matters Partner” for income tax purposes pursuant to Section 6231 of the Code (or any corresponding provision of state or local law) with respect to all taxable years of the Partnership and is authorized to do whatever is necessary to qualify as such. Subject to Section 8.10 hereof, if MediaNews is no longer a Partner or has resigned as the Tax Matters Partner, the Tax Matters Partner shall be any Partner designated as such by a unanimous vote of the Partners, and in the absence of a unanimous vote, as shall be determined under applicable provisions of the Code and/or Regulations. The Tax Matters Partner shall, as soon as practicable under the circumstances, inform each Partner of all tax-related matters that are, or have

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the reasonable potential to become, material to the Partnership that come to its attention in its capacity as Tax Matters Partner.

          (b) The Tax Matters Partner shall prepare or cause to be prepared all tax returns required of the Partnership. As soon as practicable after the end of each Fiscal Year, the Tax Matters Partner shall furnish to each Partner such information in the possession of the Tax Matters Partner requested by such Partner as necessary to timely fulfill such Partner’s federal, state, local and foreign tax obligations, including Form K-1, or any similar form as may be required by the Code or the Internal Revenue Service (the “IRS”) or, to the extent any such information is not in the Tax Matters Partner’s possession, the Tax Matters Partner shall take all reasonable steps necessary to have such information provided to the requesting Partner. No later than forty-five (45) business days prior to filing with the IRS, the Tax Matters Partner shall deliver to each Partner for its review a complete copy of the federal income tax return proposed to be filed by the Partnership. The Tax Matters Partner shall consider in good faith, consistent with Section 6.3(c) hereof, any comments of the Partners with respect to such return made within thirty (30) business days of sending the copy of such return. The Partners shall file their individual or corporate returns in a manner consistent with the Partnership tax and information returns.

          (c) The Tax Matters Partner shall, consistent with the Business Plans, use its best efforts to do all acts and take whatever steps are required to maximize, in the aggregate, the federal, state and local income tax advantages available to the Partnership and shall defend all tax audits and litigation with respect thereto. The Tax Matters Partner shall maintain the books, records and tax returns of the Partnership in a manner consistent with the acts, elections and steps taken by the Partnership.

     6.4 Actions in Event of Audit. If an audit of any of the Partnership’s tax returns shall occur, each Partner shall, at the expense of the Partnership, participate in the audit. No Partner may contest, settle or otherwise compromise assertions of the auditing agent which may be adverse to the Partnership or any Partner without the approval of a unanimous Management Committee. The Management Committee may, if it determines that the retention of accountants or other professionals would be in the best interests of the Partnership, retain such accountants or other professionals, to assist in any such audits. The Partnership shall indemnify and reimburse the Management Committee for all expenses, including legal and accounting fees, claims, liabilities, losses, and damages to the extent borne by the Management Committee, incurred in connection with any administrative or judicial proceeding with respect to any audit of the Partnership’s tax returns. The payment of all such expenses to which this indemnification applies shall be made before any distributions are made to the Partners under Article V hereof. Neither the Tax Matters Partner, nor any other person shall have any obligation to provide funds for such purpose. The taking of any action and the incurring of any expense by the Management Committee in connection with any such proceeding, except to the extent required by law, is a matter in the sole discretion of the Management Committee.

     6.5 Tax Elections. The Tax Matters Partner shall, in its reasonable discretion, determine (x) whether or not to cause the Partnership to file an election under Code

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section 754 and the Regulations thereunder and a corresponding election under the applicable section of state and local law, (y) which method to apply to any asset of the Partnership under Section 704(c) of the Code consistent with Section 4.3(b) hereof and whether or not to make any other elections provided for under related state and local laws, and (z) any other tax elections.

ARTICLE VII
ACTIONS BY PARTNERS

     7.1 Meetings. Meetings of the Partners shall be held at the place and time designated from time to time unanimously by the Partners. The Partners may take action by the vote of Partners at a meeting in person or by proxy, or without a meeting by written consent. In no instance where action is authorized by written consent need a meeting of Partners be called or noticed.

     7.2 Actions by the Partners. All actions required or permitted to be taken by the Partners with respect to the Partnership require the vote or consent of all of the Partners.

ARTICLE VIII
MANAGEMENT

     8.1 The Management Committee. Subject to Sections 8.1 (c) and 8.1(d) hereof, the business and affairs of the Partnership shall be managed under the direction and authority of a Management Committee as more fully described in this Agreement. No later than April 1 of each year during the term of this Agreement (or, for the year during which the Effective Date occurs, within thirty days after the Effective Date), Gannett shall annually adopt a Business Plan for the Gannett Designated Newspapers and MediaNews shall annually adopt a Business Plan for the MediaNews Newspapers. The Business Plans shall be subject to the unanimous approval of the Management Committee, which such approval shall not be unreasonably withheld or delayed. If the Management Committee fails to approve the Business Plans by June 1 of any year (or, for the year during which the Effective Date occurs, within sixty days after the Effective Date), unless otherwise agreed in writing by Gannett and MediaNews, until such time as new Business Plans have been approved by the Management Committee, the most recent business plan previously approved by the Management Committee shall continue to apply with respect to the applicable newspapers (subject to an increase in the operating budget of two percent (2%) per year since the date of the most recent operating budget included therein).

          (a) Number, Appointment and Term of Managers. The Management Committee shall be comprised of five (5) members. Subject to Section 8.10 hereof, three (3) members shall be appointed by MediaNews and two (2) members shall be appointed by Gannett. The managers shall act solely as the agents of the Partners appointing them. Each manager shall serve at the pleasure of the Partner appointing him and until his successor has been duly appointed, or until his resignation or removal. Each Partner shall also be entitled to designate two non-voting observers to attend and

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participate in all meetings of the Management Committee. So long as William Dean Singleton is CEO of MediaNews Group, Inc., MediaNews shall elect a chairman of the Management Committee (“Chairman”) who shall have the responsibility for convening and chairing the meetings of the Management Committee. The Chairman may, but need not be, one of the members appointed by MediaNews to the Management Committee, provided however that when acting in his capacity as Chairman he shall not be counted for the purposes of constituting a quorum, nor shall he have any voting rights on matters brought before the Management Committee. If a Chairman has not been elected by MediaNews or in the absence or unavailability of the Chairman, the member who requested the meeting shall convene and chair the meeting. If Mr. Singleton is no longer serving as CEO of MediaNews Group, Inc., a Chairman may be appointed by at least three (3) members of the Management Committee.

          (b) Duties and Powers. The Management Committee may exercise all powers of the Partnership as are expressly afforded to it under this Agreement. Each member of the Management Committee may delegate to a representative by written proxy the right to act on behalf of the member in any respect, including without limitation the right to attend meetings or telephone conferences, to represent that Partner’s appointed member for the purposes of constituting a quorum at a meeting, and to vote upon resolutions with or without a meeting.

          (c) Gannett Designated Newspapers. Except as expressly reserved to the Management Committee in this Agreement, from and after the Effective Date, Gannett shall have complete discretion, power and authority in the management and control of the business of the Gannett Designated Newspapers, shall make all decisions affecting the business of the Gannett Designated Newspapers and shall manage and control the affairs of the Gannett Designated Newspapers to carry out the business and purposes of the Partnership. Without limitation of the generality of the foregoing, with respect to the Gannett Designated Newspapers, Gannett is hereby authorized to:

          (i) establish and maintain bank accounts and to expend Partnership funds to pay operating expenses of the Gannett Designated Newspapers in the ordinary course of business and consistent with the Business Plan for the Gannett Designated Newspapers;

          (ii) employ and discharge such agents, employees, independent contractors, attorneys and accountants as Gannett deems reasonably necessary in the ordinary course of business and consistent with the Business Plan for the Gannett Designated Newspapers;

          (iii) commence, prosecute, defend, compromise, settle and dismiss any claims, proceedings, actions or litigation brought by or against the Partnership, any Partner or their employees or agents in connection with activities arising out of, or connected with, or incident to the Gannett Designated Newspapers, and to engage counsel or others in connection therewith;

          (iv) keep in force such insurance as may be required to reasonably protect the assets of the Gannett Designated Newspapers in the ordinary course of

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business and consistent with the Business Plan for the Gannett Designated Newspapers;

          (v) acquire by purchase, lease or otherwise any real or personal property which may be necessary or desirable for the operation of the Gannett Designated Newspapers in the ordinary course of business and consistent with the Business Plan for the Gannett Designated Newspapers;

          (vi) operate, maintain, improve, construct, own, sell, convey and/or lease any real or personal property necessary or desirable for the operation of the Gannett Designated Newspapers in the ordinary course of business and consistent with the Business Plan for the Gannett Designated Newspapers;

          (vii) execute any and all agreements, contracts, purchase orders, certifications, instruments and other documents which may be necessary or desirable for the management, maintenance and operation of the Gannett Designated Newspapers in the ordinary course of business and consistent with the Business Plan for the Gannett Designated Newspapers; and

          (viii) take such other actions as Gannett may reasonably believe to be necessary or desirable to manage the affairs of the Gannett Designated Newspapers.

          (d) MediaNews Newspapers. Except as expressly reserved to the Management Committee in this Agreement, from and after the Effective Date, MediaNews shall have complete discretion, power and authority in the management and control of the business of the MediaNews Newspapers, shall make all decisions affecting the business of the MediaNews Newspapers and shall manage and control the affairs of the MediaNews Newspapers to carry out the business and purposes of the Partnership. Without limitation of the generality of the foregoing, with respect to the MediaNews Newspapers, MediaNews is hereby authorized to:

          (i) establish and maintain bank accounts and to expend Partnership funds to pay operating expenses of the MediaNews Newspapers in the ordinary course of business and consistent with the Business Plan for the MediaNews Newspapers;

          (ii) employ and discharge such agents, employees, independent contractors, attorneys and accountants as MediaNews deems reasonably necessary in the ordinary course of business and consistent with the Business Plan for the MediaNews Newspapers;

          (iii) commence, prosecute, defend, compromise, settle and dismiss any claims, proceedings, actions or litigation brought by or against the Partnership, any Partner or their employees or agents in connection with activities arising out of, or connected with, or incident to the MediaNews Newspapers, and to engage counsel or others in connection therewith;

          (iv) keep in force such insurance as may be required to reasonably protect the assets of the MediaNews Newspapers in the ordinary course of business and consistent with the Business Plan for the MediaNews Newspapers;

          (v) acquire by purchase, lease or otherwise any real or personal property which may be necessary or desirable for the operation of the MediaNews Newspapers

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in the ordinary course of business and consistent with the Business Plan for the MediaNews Newspapers;

          (vi) operate, maintain, improve, construct, own, sell, convey and/or lease any real or personal property necessary or desirable for the operation of the MediaNews Newspapers in the ordinary course of business and consistent with the Business Plan for the MediaNews Newspapers;

          (vii) execute any and all agreements, contracts, purchase orders, certifications, instruments and other documents which may be necessary or desirable for the management, maintenance and operation of the MediaNews Newspapers in the ordinary course of business and consistent with the Business Plan for the MediaNews Newspapers; and

          (viii) take such other actions as MediaNews may reasonably believe to be necessary or desirable to manage the affairs of the MediaNews Newspapers.

     8.2 Removal of Members; Vacancies. A member of the Management Committee may be removed at any time, with or without cause, by the Partner (or Partners) who appointed such member. Any vacancy on the Management Committee resulting from removal, resignation, death or incapacity shall be filled by the Partner (or Partners) who is entitled to appoint such member.

     8.3 Meetings of the Management Committee; Notice. The Management Committee shall meet in regular meetings held at least quarterly at such time and place as may from time to time be determined by the Management Committee either in person or by telephone. Special meetings of the Management Committee may be called by any member. Written notice of regular and special meetings of the Management Committee, stating the place, date and hour of the meeting shall be delivered to each member together with a reasonably detailed agenda for such meeting not less than five Business Days before the date of the meeting, provided, that the foregoing notice requirement may be waived by the Management Committee with respect to any meeting at which at least three (3) members of the Management Committee (including at least one (1) member appointed by Gannett and at least one (1) member appointed by MediaNews) vote for waiver of notice. Notice may be delivered to members in person, by telephone, facsimile, electronic mail or other means of telecommunication.

     8.4 Quorum. Three (3) members of the Management Committee shall constitute a quorum for the transaction of all such business as shall have been set forth with reasonable specificity in the agenda accompanying the notice for such meeting, either in person or by telephone provided that such three (3) (or more) members who are in attendance at such meeting include at least one (1) member appointed by Gannett and at least one (1) member appointed by MediaNews. For the transaction of all other business at a regular or special meeting of the Management Committee, three (3) members of the Management Committee, whether present in person or by telephone, shall again constitute a quorum, provided that such three (3) or more

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members who are in attendance include at least one (1) member appointed by Gannett and at least one (1) member appointed by MediaNews.

     8.5 Voting. Any matter brought before the Management Committee shall be decided by a majority of members present, except for matters that require a unanimous vote of the Management Committee as provided in this Agreement or as otherwise provided under the laws of the State of Delaware.

     8.6 Certain Matters Requiring a Unanimous Vote of the Management Committee. The Partnership shall not, and Northwest New Mexico Publishing Company (successor to Pennsylvania Newspapers Publishing Inc.) shall cause York Limited Partnership not to, without a unanimous vote of all five (5) members of the Management Committee:

          (a) admit any new Partners to the Partnership or admit any new partners to York Limited Partnership;

          (b) sell, lease, transfer or otherwise dispose of (other than pro rata to the Partners), other than in the ordinary course of business, any assets, property and goodwill of any newspaper or related publication owned by the Partnership or by York Limited Partnership;

          (c) except for distributions to Partners pursuant to Section 5.1 which may be deemed to be advances, commit or cause the Partnership or York Limited Partnership to invest in or purchase the securities of, or any interests of, any person except short-term investments in U.S. Government securities, federally-insured certificates of deposit, repurchase agreements for such securities, or commercial paper rated A-1 or better by Standard and Poor’s or P-1 or better by Moody’s or its equivalent by a nationally recognized statistical rating organization;

          (d) commit or cause the Partnership or York Limited Partnership to acquire all or substantially all of the capital stock or all or substantially all of the assets of any person or business deemed to be material or outside of the ordinary course of business;

          (e) except as provided in Section 3.1(b) or Section 12.2 hereof, obligate the Partners to make any Additional Capital Contribution or, except as provided in Section 3.1(e), adjust any Partner’s Percentage Interest;

          (f) cause the Partnership or York Limited Partnership to create, or enter into, any corporation, partnership, limited liability company, joint venture, association, trust or other business entity or to merge or consolidate with any person;

          (g) except as provided in Section 8.9 hereof, commit or cause the Partnership or York Limited Partnership to enter into any contract, agreement, understanding or transaction (i) with any person, that is other than in the ordinary course of the Partnership’s business, (ii) with a Partner or an affiliate of any Partner, which would have the result of imposing terms or conditions on the Partnership or York Limited Partnership that are more onerous or less advantageous to the Partnership or York Limited Partnership than those customarily provided by such Affiliate to its affiliates or (iii) with a Partner or an Affiliate of any Partner that either involves goods, services or

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properties of a value of more than $350,000 in the aggregate over the entire term of such contract, agreement, understanding or transaction, or does not reflect standard and customary commercial terms;

          (h) accept the contribution of any additional newspapers or related assets from any Partner as an Additional Capital Contribution under the provisions of Section 3.1(c) hereof;

          (i) commit or cause the Partnership or York Limited Partnership (i) to borrow any funds outside of the ordinary course of business; (ii) to enter into any capitalized lease agreements, which are material or outside of the ordinary course of business, except for refinancings or extensions of any existing indebtedness of the Partnership or York Limited Partnership (including, without limitation, the Indebtedness), (iii) to enter into any hedge agreement, or (iv) to guarantee the indebtedness of any other person or entity;

          (j) make any Capital Expenditures materially in excess of the amounts provided in the Business Plan for such expenditures or which are not in the ordinary course of business;

          (k) except as permitted pursuant to Article X hereof, dissolve or liquidate the Partnership or York Limited Partnership;

          (l) make any material change to the nature of the Partnership’s business as described in Section 2.3 or make any material change to the nature of the business of York Limited Partnership as conducted as of December 25, 2005;

          (m) adopt any portion of the Business Plan which would, of itself, require a unanimous vote of the Management Committee;

          (n) amend, terminate or change in any material respect the Partnership’s existing business relationships at its Texas and New Mexico newspapers with Career Builder or Classified Ventures;

          (o) pledge, assign, hypothecate or grant any security interest in, or with respect to, all or any portion of the York Partnership Interest or any material assets of the York Partnership’s Newspapers or the Partnership; or

          (p) amend or waive any provision of this Agreement, the York Joint Operating Agreement or the York Limited Partnership Agreement (the parties understand and agree, however, that the grant of any such consent or approval with respect to any proposed amendment shall in no way waive or modify any rights of the Partnership or Gannett under the Contribution Agreement).

     8.7 Action by Consent. Any action required or permitted to be taken on behalf of the Partnership at any meeting of the Management Committee may be taken without a meeting by written consent signed by the number of members of the Management Committee required to approve such action, provided that such members include at least one member appointed by each of the Partners.

     8.8 Executive Officers. Gannett shall have the right to appoint senior management of the Gannett Designated Newspapers and MediaNews shall have the

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right to appoint senior management of the MediaNews Newspapers. Such persons may be employees of Gannett or MediaNews, as the case may be.

     8.9 Provision of Services to Partnership by MediaNews.

          (a) The Partners hereby agree that the Partnership shall obtain from MNG operating, administrative, accounting, electronic media and/or other support services, newsprint purchase services, financial reporting services, human resource services, employee benefit plans and services, risk management services, tax reporting and tax return preparation services and other similar services which MediaNews Group, Inc., a Delaware corporation (“MNG”), provides to its own operating affiliates (collectively, the “MediaNews Support Services”), which MediaNews Support Services shall be provided at MNG’s cost. However, Gannett Satellite Information Network, Inc., a Delaware corporation and the general partner of Gannett (“GANSAT”) shall, unless the Partnership requests otherwise, continue to provide newsprint purchase services to the Partnership’s newspapers located in Texas and New Mexico. Newsprint purchased for the Partnership by GANSAT shall be provided at GANSAT’s cost, including all vendor discounts related to newsprint purchased by the Partnership. Newsprint purchased for the Partnership by MNG shall be provided at MNG’s cost, including all vendor discounts related to newsprint purchased by the Partnership.

          (b) For periods on and after December 31, 2005, Partnership employees shall participate in defined contribution retirement, welfare and other employee benefit plans made available by MNG (the “New Plans”), and, as of December 31, 2005, Partnership employees ceased active participation in employee benefit plans made available through Gannett (the “Gannett Plans”) (except as otherwise provided in the Transitional Services Agreement). Additionally, on an ongoing basis for periods after December 31, 2005, Gannett shall be entitled to charge the Partnership, in accordance with past practice, for the Partnership’s portion of the cost for retiree medical or life insurance for those former Partnership employees receiving retiree medical or life insurance benefits as of December 31, 2005 under Gannett’s retiree medical or life insurance plans (no individual who is employed by the Partnership on or after December 31, 2005 shall be entitled to receive benefits under Gannett’s retiree medical or life insurance plans). From and after December 31, 2005 (or such later date set forth in the Transitional Services Agreement), Gannett shall be solely responsible for, and without charge to the Partnership, continuing to provide long-term disability benefits and workers’ compensation benefits to Partnership employees who are entitled to such benefits under Gannett’s plans as of December 31, 2005. As of December 31, 2005 (or such later date set forth in the Transitional Services Agreement), the New Plans shall provide short-term disability benefits to Partnership employees receiving such benefits as of such date and shall provide the coverage required by Section 4980B of the Code and Part 6 of Subtitle B of Title I of ERISA to individuals who are entitled to or receiving such coverage as of such date by virtue of being, or their connection with, a current or former Partnership employee. Except as set forth in this Section, Gannett shall be solely responsible and liable for providing all benefits accrued under the Gannett Plans. For purposes of the New Plans, (A) each Partnership employee shall be immediately eligible to participate, without any waiting period, in any and all New Plans to the extent coverage under such New Plan is

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comparable to a Gannett Plan or compensation arrangements or agreements in which such Partnership employee participated immediately before December 31, 2005; and (B) for purposes of each New Plan providing medical, dental, pharmaceutical and/or vision benefits to any Partnership employee, MNG shall cause all pre-existing condition exclusions and actively-at-work requirements of such New Plan to be waived for such employee and his or her covered dependents, and MNG shall cause any eligible expenses incurred by such employee and his or her covered dependents during the portion of the plan year of the Gannett Plan ending on the date such employee’s participation in the corresponding New Plan begins to be taken into account under such New Plan for purposes of satisfying all deductible, coinsurance and maximum out-of-pocket requirements applicable to such employee and his or her covered dependents for the applicable plan year as if such amounts had been paid in accordance with such New Plan. Additionally, MNG shall credit Partnership employees with their service with Gannett or its affiliates for purposes of eligibility to participate, vesting and determining such employees’ entitlement to a level of benefits (but not for purposes of benefit accrual) under all employee plans, programs or arrangements made available by MNG to Partnership employees after December 31, 2005. All services and supplies, including employee benefits, shall be provided to the Partnership at cost without any administrative charge, allocation of internal expenses or adjustment for overhead or any other direct or indirect payment to MNG or GANSAT, or their affiliates.

          (c) MNG, by agreeing to provide MediaNews Support Services, agrees to perform those services with the degree of care that a reasonably prudent person would exercise and shall not enter into any transaction in which it may have a conflict of interest without the unanimous consent of the members of the Management Committee. If MNG should at anytime, due to bankruptcy, insolvency or similar incapacity, become unable to continue to provide such services on behalf of the Partnership, the Partners shall, by mutual agreement, make appropriate arrangements for the provision of such services by one or more of the other Partners or their Affiliates, or by one or more third parties.

     8.10 Partnership Change in Control. In the event of a Partnership Change in Control, Gannett shall have the right, exercisable in its sole discretion from time to time by giving not less than two (2) Business Days prior written notice to MediaNews at any time following a Partnership Change in Control, to cause some or all of the following changes to occur, which change(s) shall be effective from and after the effective date (the “Effective Date”) of the change specified in any such notice: (i) Gannett shall have the right to appoint three (3) of the five (5) members of the Management Committee and MediaNews shall have the right to appoint two (2) members of the Management Committee and, if Gannett exercises such right, the members serving on the Management Committee immediately prior to the Effective Date shall be deemed to have been removed by the Partners who appointed them as of the Effective Date; and (ii) Gannett shall have the right to be designated the Tax Matters Partner of the Partnership and, if Gannett exercises such right, MediaNews shall no longer serve as the Tax Matters Partner. From and after the Effective Date, MediaNews will, at its expense, (x) execute and deliver, or cause to be executed and delivered, such documents to Gannett and the Partnership (including, but not limited to, any

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amendments to this Agreement) and take such actions as Gannett may reasonably request in order to effect the foregoing changes; and (y) use all reasonable efforts to obtain any third party consents or approvals which may be necessary in connection with any of the foregoing changes.

ARTICLE IX
TRANSFER OF PARTNERSHIP INTERESTS;
ADDITIONAL AND SUBSTITUTE PARTNERS

     9.1 Prohibited Transfers. No Partner may Transfer its Interest or any part thereof in any way whatsoever, and any such Transfer in violation of this Article IX shall be null and void as against the Partnership, except as otherwise permitted herein or provided by law, and the Transferring or withdrawing Partners shall be liable to the Partnership and the other Partners for all damages that they may sustain as a result of such attempted Transfer or withdrawal.

     9.2 Permitted Transfers by Partners. No Partner may Transfer all or a portion of its Interest unless all of the conditions set forth in Section 9.5 have been satisfied, in addition to each of the following conditions:

          (a) the Partner desiring to consummate such Transfer (the “Assigning Partner”), and the prospective Transferee each execute, acknowledge and deliver to all the other Partners such instruments of transfer and assignment with respect to such Transfer and such other instruments as are reasonably satisfactory in form and substance to all the Partners;

          (b) the Transfer will not violate any federal or state laws;

          (c) the Transfer will not cause any violation of or an event of default under, or result in acceleration of any indebtedness under, any note, mortgage, loan, or similar instrument or document to which the Partnership is a party;

          (d) the Transfer will not cause a material adverse tax consequence to the Partnership or any of the Partners including but not limited to any material adverse tax consequence resulting, directly or indirectly, from the termination of the Partnership under section 708 of the Code;

          (e) the Transfer will not cause the Partnership to be classified as an entity other than a partnership for purposes of the Code; and

          (f) except for transfers of a Partner’s Interest to an Affiliate of such Partner, any amendments to this Agreement required by or made a condition by any Partner to its consent to the transfer, have been made.

     9.3 Substitute Partner. A Transferee of the whole or any part of an Interest who satisfies all of the conditions referenced in Section 9.2 hereof shall have the right to become a Partner in place of the Assigning Partner only if all of the following conditions are satisfied:

          (a) the fully executed and acknowledged written instrument of assignment that has been filed with the Partnership sets forth a statement of the

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intention of the Assigning Partner that the Transferee become a Substitute Partner in its place;

          (b) the Transferee executes, adopts and acknowledges this Agreement (as it may be amended) and agrees to assume all the obligations of the Assigning Partner; and

          (c) any costs of the Transfer incurred by the Partnership shall have been reimbursed by the Assigning Partner or the Transferee to the Partnership.

     9.4 Involuntary Withdrawal by a Partner. With respect to the Transfer of a Partner’s Interest due to bankruptcy, or other insolvency, involuntary dissolution or liquidation, and any foreclosure (or other exercise of remedies by a party holding a security interest in such Interest) (each, an “Involuntary Transfer”), the Partner with respect to whom such event occurred shall forthwith cease to be a Partner and shall have no rights or powers as a Partner except for such rights as are specified pursuant to Articles III, IV and V and Section 10.3(b) hereof.

     9.5 Right of First Refusal for Sale of Partnership Interests.

          (a) No Partner may voluntarily Transfer all or any part of its Interest in the Partnership to any party (i) in any case prior to December 31, 2008 or (ii) after that date unless it has complied with the procedures of Section 9.2 and first offers to sell such Interest to the other Partner(s) pursuant to the terms of this Section 9.5; provided that this Section 9.5 shall not be applicable with respect to a Transfer to an Affiliate of the transferring Partner.

          (b) A Partner (the “Offering Partner”) who has received a firm, written, bona fide offer from a third-party for its Interest (a “Third Party Offer”) or who has otherwise determined to offer its Interest for sale shall, before offering such Interest or agreeing to accept such offer for such Interest (in either case, the “Offered Interest”), give written notice to the other Partners that are not Affiliates of the Offering Partner (each an “Option Partner”) of such offer or intent including, in the case of a Third Party Offer, a copy of such Third Party Offer and a complete description thereof including, by way of example but not of limitation, the nature and extent of such Third Party Offer, the purchase price therein, the terms of payment and the time for performance.

          (c) Upon receiving the Offering Partner’s written notice pursuant to Section 9.5(b), the Option Partner(s) shall have a period of thirty (30) days following the date of receipt by the Option Partner of the Offering Partner’s notice to elect to purchase the Offered Interest at the price determined in accordance with Section 9.5(f). If an Option Partner desires to purchase the Offered Interest it shall give written notice to the Offering Partner in the manner set forth in Section 13.2 hereof within such 30-day period. To be effective, this notice must be received by the Offering Partner within such 30-day period. In no event may the Option Partner(s) elect to acquire less than all of the Offered Interest. To the extent there is more than one Option Partner, the Option Partners accepting such offer shall be jointly and severally liable to the Offering Partner to purchase all of the Offered Interest.

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          (d) The closing of the sale and purchase of the Offered Interest shall be promptly completed, but in any event, to the extent practicable, within ninety (90) days after the receipt of the Option Partner(s)’ notice of acceptance (or such later date as necessary to obtain any necessary regulatory approvals). The Management Committee shall assist in coordinating the closing. At the closing, the Offering Partner shall sell the Offered Interest, free and clear of all liens and encumbrances, and execute and deliver such assignment(s) and all other documents or other instruments of assignment or conveyance necessary to effect and evidence the assignment. At the closing, the Option Partner(s) shall deliver to the Offering Partner cash, a certified or official bank check or shall pay by wire transfer of immediately available funds for the applicable purchase price.

          (e) If the Option Partner(s) do not elect to purchase all of the Offered Interest pursuant to this Section 9.5, then the Offering Partner shall be free to sell, assign, transfer, pledge, encumber or otherwise dispose of the Offered Interest pursuant to the Third Party Offer or, in the case of a non-Third Party Offer, to any third party for an amount equal to Fair Market Value of the Offered Interest, as hereunder determined, in either case, within six month’s after the date of the Option Partner(s)’ notice of refusal or after the expiration of the 30-day response period, whichever occurs first. For purposes of this Section 9.5(e), a sale shall be deemed made when there is executed a legally binding agreement between the Offering Partner and the prospective purchaser, subject to no condition or contingency which permits the prospective purchaser to terminate or cancel the agreement, except for the default of the Offering Partner, and routine approvals or conditions. If a sale within the meaning of this Section 9.5(e) is not made within such 6-month period, then the Offered Interest shall remain subject to the restrictions of this Agreement and must again be first offered to the Option Partner(s) if the Offering Partner thereafter wishes to sell its Interest to a third party.

          (f) (i) In the case of a Third Party Offer, if the consideration offered by the prospective purchaser is offered in cash and/or a promissory note or other similar instrument to be issued by the prospective purchaser, the price shall be the price offered by such prospective purchaser. If (A) the consideration offered by the prospective purchaser is offered in a form other than cash and/or a promissory note or other similar instrument or (B) the Offering Partner has not received a Third Party Offer, then in either case, the price shall be the Fair Market Value of the Offered Interest, as defined below.

               (ii) For the purposes of this Agreement, “Fair Market Value of the Offered Interest” shall be the amount that would be paid for the Offered Interest in the Partnership as a going concern, on a consolidated basis, by a willing buyer to a willing seller. The Offering Partner and the Option Partner(s) may mutually agree as to the Fair Market Value of the Offered Interest in question. If the Offering Partner and the Option Partner(s) are unable to agree on the Fair Market Value of the Offered Interest within fifteen (15) days after the Offering Partner’s written notice of the proposed sale, then in such event Fair Market Value of the Offered Interest shall be determined pursuant to Section 9.5(f)(iii) by two independent qualified appraisers, one to be appointed by the Offering Partner and the other to be appointed by the Option Partner(s).

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               (iii) The two independent appraisers shall be appointed within fifteen (15) days after receipt by the Option Partner(s) of the notice of proposed sale. If either side fails to appoint an appraiser within such period, then its right to do so shall lapse and the appraisal made by the one independent appraiser who is timely appointed shall be the Fair Market Value of the Offered Interest. If two appraisals are made, and if the two appraised values differ by less than 15 percent, Fair Market Value of the Offered Interest shall be the average of the two appraisals, and if the two appraised values differ by more than 15 percent, the two appraisers shall jointly select a third appraiser and, the Fair Market Value of the Offered Interest shall be the average of the two of the three appraisals that are closest together in amount. All appraisals shall be made within thirty (30) days of appointment of an appraiser, and written notice of the results of such appraisals shall be given to all parties within such 30-day period. The Fair Market Value of the Offered Interest shall be determined based upon the value of the Partnership in its entirety as a going concern, with the Offering Partner receiving a proportionate part of such total value based upon its Percentage Interest. In making any appraisal hereunder, all debts and liabilities shall be taken into account. Each side shall pay the fees of the appraiser selected by them.

     9.6 Tag-Along Rights Regarding Sales of Partnership Interests.

          (a) Except for Transfers of a Partner’s Interest to an Affiliate of such Partner and except following an Involuntary Transfer of a Partner’s Interest, in any case where a Partner has declined to exercise its rights of first refusal under Section 9.5, no Partner (the “Tag-Along Offeror”) shall, individually or collectively, in any one transaction or series of transactions, directly or indirectly, sell or otherwise dispose of its Interest, to any person (a “Third Party”) unless the terms and conditions of such sale or other disposition to such Third Party shall include an offer to each other Partner (each, a “Tag-Along Offeree”) to include, at the option of each Tag-Along Offeree, in the sale or other disposition to the Third Party, such Tag-Along Offeree’s Interest (the “Tag-Along Right”). Each Partner proposing to effect such a sale or other disposition shall send a written notice (the “Tag-Along Notice”) to each of the Tag-Along Offerees setting forth the terms of the offer. At any time within 15 days after its receipt of the Tag-Along Notice, each Tag-Along Offeree may exercise its Tag-Along Option by furnishing written notice of such exercise (the “Tag-Along Exercise Notice”) to the Tag-Along Offeror.

          (b) If the proposed sale or other disposition to the Third Party by the Partner providing the Tag-Along Notice is consummated, each Tag-Along Offeree shall have the right to sell such Third Party all of its Interest.

          (c) Each Partner participating in the sale or other disposition to the Third Party shall have the right, in their sole discretion, at all times prior to consummation of the proposed sale or other disposition giving rise to the Tag-Along Right granted by this Section to abandon, rescind, annul, withdraw or otherwise terminate such sale or other disposition as it relates to such Partner’s Interest whereupon that Partner’s Tag-Along Rights in respect of such sale or other disposition pursuant to this Section shall become null and void, and neither the Tag-Along Offeror nor the Third Party shall have any liability or obligations to the withdrawing Tag-Along

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Offeree with respect thereto by virtue of such abandonment, rescission, annulment, withdrawal or termination.

          (d) The purchase of each Tag-Along Offeree’s Interest pursuant to this Section shall be on the same terms and conditions, including but not limited to the purchase price (as adjusted for any difference in size of the respective Interest’s), as are applicable to the Partner giving the Tag-Along Notice, which shall be stated in such Tag-Along Notice. In determining the purchase price of any Interest under this Section, the aggregate purchase price of all Interests being acquired by the Third Party shall be increased to the extent any of the selling Partners shall receive additional compensation (A) for covenants not to compete or (B) for services (such as pursuant to consulting agreements or management agreements) which are in excess of the amounts which would be payable for comparable services as a result of an arm’s-length transaction.

          (e) If, within 15 days after receipt of a Tag-Along Notice, any Tag-Along Offeree has not delivered a Tag-Along Exercise Notice, such Tag-Along Offeree will be deemed to have waived any and all of its rights with respect to the sale or other disposition of Interests described in such Tag-Along Notice and the other Partners shall have 135 days following the expiration of such 15-day period in which to consummate such sale or other disposition on terms not more favorable to such other Partners than those described in the Tag-Along Notice. If, at the end of 150 days following receipt of such Tag-Along Notice, the sale or other disposition described therein has not been completed, then all restrictions on sale or other disposition contained in this Agreement shall again be in effect.

     9.7 Admission of Additional Partners. A person shall become an Additional Partner only if and when each of the following conditions is satisfied:

          (a) the Management Committee, unanimously and in its sole and absolute discretion, determine the Additional Contribution Terms;

          (b) the Partnership has complied with the terms of Section 3.1(b);

          (c) all of the Partners consent in writing to such admission, which consent may be withheld by any such Partner in its sole and absolute discretion;

          (d) the Management Committee receives written instruments (including, without limitation, such person’s consent to be bound by this Agreement (as it may be amended) as an Additional Partner) that are in a form satisfactory to the Management Committee (as determined in its sole and absolute discretion);

          (e) the Partnership has received such person’s Capital Contribution; and,

          (f) any amendments to this Agreement required by or made a condition by any Partner to its consent to the transfer, have been made.

     9.8 Acknowledgment of Pledge of Interests. Gannett hereby (i) acknowledges that MediaNews’ Interest in the Partnership has been pledged as security under an Amended and Restated Credit Agreement dated as of December 30, 2003, as currently amended, among MediaNews Group, Inc., Bank of America, N.A., and other banks, as

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amended, substituted, refinanced, renewed or replaced (without regard to the amount of credit extended thereunder or the identity of the lenders or agents with respect thereto) and (ii) without limitation of its rights under Section 8.10, agrees that any foreclosure on such pledge shall not be deemed a Transfer for purposes of Sections 9.3, 9.5 and 9.6 (but shall be deemed an Involuntary Transfer pursuant to Section 9.4).

     9.9 Rights of First Refusal with Respect to Certain Assets Offered to the Partners. With respect to any offer or sale of substantially all of the assets, properties and goodwill of: (a) any newspapers or related publications a majority of the circulation of which occurs in the State of New Mexico, with the exception of McKinley county, Bernalillo county, and Santa Fe county; (b) any newspapers or related publications a majority of the circulation of which occurs in the counties of Adams, Berks, Cumberland, Dauphin, Franklin, Lancaster, Lebanon, Perry or York in the Commonwealth of Pennsylvania or in El Paso county, Texas; or (c) any radio or television station licensed in Dona Ana, Otero, or Eddy counties, New Mexico or the El Paso television DMA or the Harrisburg-Lancaster-Lebanon-York television DMA that is made to either Gannett or MediaNews or their respective Affiliates during the term of this Agreement (other than offers which relate to assets, properties and goodwill which the party receiving such offer is, as of the date of this Agreement, contractually obligated to offer to a third person an equity interest therein, or other investment opportunity with respect thereto), such party (the “Notifying Party”) shall give prompt written notice of such offer to the other Partner. Should the other Partner give written notice to the Notifying Party of its approval of the negotiation for the acquisition of such assets, properties and goodwill by the Partnership within 10 days of its receipt of the Notifying Party’s notice of the offering of such assets, the Notifying Party shall not negotiate to acquire such assets, properties and goodwill for its own account, and the Notifying Party shall instead permit the Partnership to negotiate for the acquisition of such assets, properties and goodwill from the seller of such assets. Should the other Partner fail to provide the Notifying Party such written notice of approval, the Notifying Party may proceed to acquire such assets, properties and goodwill for its own account and ownership.

ARTICLE X
DISSOLUTION AND LIQUIDATION

     10.1 Dissolution.

          (a) The Partnership shall be dissolved upon the first to occur (each a “Dissolution Event”):

               (i) December 31, 2053;

               (ii) Upon the election by written notice to the other Partners by one or more Partners (the “Electing Partner”) to terminate the Partnership prior to December 31, 2053 in connection with an Involuntary Transfer of the Electing Partner’s Interest or to the extent required by the Electing Partner to effect compliance with the provisions of any indenture applicable to publicly held indebtedness of the Electing Partner;

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               (iii) Upon the election by Gannett or MediaNews to dissolve the Partnership at any time after December 25, 2012 (or, if Gannett has made the Gannett CNP Contribution, seven years and one day after the CNP Contribution Date), by giving written notice to the other Partners after such date of its election to cause the Partnership to be dissolved and liquidated in accordance with Section 10.4; or

               (iv) The occurrence of any other event specified under the Delaware Uniform Partnership Law (6 Del. C. 1953, Section 1501 et seq.) as one effecting such dissolution.

          (c) Notwithstanding the provisions of subsection (a)(ii) above, a dissolution of the Partnership (other than a dissolution described in Section 10.1(a)(iii) hereof) shall not occur if, within 10 business days of receipt of the written notice described in subsection (a)(ii) above, the Partners other than the Partner who is the Electing Partner provide written notice to the Electing Partner of their election to continue the business of the Partnership and of their undertaking to cause the Partnership to enter into a contract to redeem all of the Interest in the Partnership of the Electing Partner, in exchange for a distribution of cash equal to the then-determined fair market value of such Interest (net of any liabilities allocable to such Interest) plus the amounts described in the second to last sentence of Section 10.1(c) within 2 years of the date the fair market value of such Interest is determined under this Section 10.1(b). Such fair market value shall be determined in accordance with the procedures set forth in Section 9.5(a) through (f) above, provided, however, that the period for negotiation between the Partners set forth in Section 9.5(f)(ii) shall be 90 days. At the time such fair market value is determined, the Interest of the Electing Partner in the Partnership shall terminate and Electing Partner shall be treated as a “retiring partner” for purposes of Code Section 736 and the payment described in this Section 10.1(b) shall be treated as described in Code Section 736(b).

          (c) Upon the date of the determination of such fair market value, the Electing Partner’s right to receive any distribution or allocation of Profits from the Partnership under Section 4.2(b) shall convert automatically into a first priority interest in the Profits of the Partnership equal to the product of (x) the determined fair market value of such Interest and (y) LIBOR plus (I) 1 percent for the first 6-month period following the date of determination of the fair market value; (II) 2 percent for the seventh through ninth months following the date of determination of the fair market value; (III) 3 percent for the tenth through twelfth months following the date of determination of the fair market value; (IV) 4 percent for the thirteenth through fifteenth months following the date of determination of the fair market value; (V) 5 percent for the sixteenth through eighteenth months following the date of determination of the fair market value; (VI) 6 percent for the nineteenth through twenty-first months following the date of determination of the fair market value; and (VII) 7 percent for the twenty-second through twenty-fourth months following the date of determination of the fair market value. The payments described in this Section 10.1(c) shall be treated as distributions of partnership income as described in Code Section 736(a).

     10.2 Election to Continue the Business. The Partnership shall also not be dissolved pursuant to a Dissolution Event specified in Sections 10.1(a)(i) or (iv) (except

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as otherwise provided in the Act), if, within 20 business days of such Dissolution Event, all the remaining Partners unanimously agree in writing to continue the business of the Partnership.

     10.3 Closing of Affairs.

          (a) In the event of the dissolution of the Partnership for any reason prior to December 25, 2012 (or, if Gannett has made the Gannett CNP Contribution, prior to seven years and one day after the CNP Contribution Date), and in the absence of an election pursuant to Sections 10.1(b) or 10.2 hereof to continue the business of the Partnership, the Dissolution Committee shall commence to close the affairs of the Partnership, to liquidate or retain for distribution to the Partners its investments and to terminate the Partnership, in each instance in such manner as the Dissolution Committee may reasonably determine to be appropriate, provided, however, that no distribution of any Partnership property shall be made to any of the Partners (except for in kind distributions pursuant to Section 10.4(b) hereof, which Section shall apply to any Dissolution Event occurring after December 25, 2012 or, if Gannett has made the Gannett CNP Contribution, any Dissolution Event occurring at any time subsequent to seven years and one day after the CNP Contribution Date) except upon the prior approval of all of the Partners. Upon complete liquidation of the Partnership’s property and compliance with the distribution provisions set forth in Section 10.3(b) hereof, the Partnership shall cease to be such, and the Dissolution Committee shall cause to be executed, acknowledged and filed all certificates necessary to terminate the Partnership.

          (b) In liquidating the Partnership in accordance with Section 10.3(a) hereof, the assets of the Partnership shall be applied to the extent permitted by the Act in the following order of priority:

               (i) First, to pay the costs and expenses of the closing of the affairs and liquidation of the Partnership;

               (ii) Second, to pay the matured debts and liabilities of the Partnership;

               (iii) Third, to establish reserves adequate to meet any and all contingent or unforeseen liabilities or obligations of the Partnership, provided that at the expiration of such period of time as the Dissolution Committee may deem advisable, the balance of such reserves remaining after the payment of such contingencies or liabilities shall be distributed as hereinafter provided;

               (iv) Fourth, to all Partners in proportion to each Partner’s Percentage Interest in the Partnership, after taking appropriate account of, and making appropriate adjustments for, (A) any Indebtedness then remaining outstanding which is attributable to any Partnership assets previously contributed by a particular partner, and (B) any portion of any required capital contributions or accrued but unpaid interest described in either Section 3.1(b) or 3.1(c) of this Agreement which then remains outstanding, (provided, however, that to the extent that any Partner has a finally adjudicated indemnity obligation to any other Partner, any distribution that would

35

otherwise be distributed to the Partner subject to such obligation shall be distributed to the Partner(s) entitled to the benefit of the indemnity obligation to the extent thereof).

          (c) No Partner shall have any obligation to restore a deficit balance in its Capital Account.

     10.4 Liquidator of the Partnership; In Kind Distribution of Newspapers.

          (a) A committee of six (6) persons, three (3) of which are to be appointed by Gannett and three (3) of which are to be appointed by MediaNews, pursuant to the procedures in Section 8.1, which committee shall act only by unanimous consent (collectively, the “Dissolution Committee”), shall serve as the liquidator of the Partnership to wind up the affairs of the Partnership.

          (b) In connection with any Dissolution Event occurring after December 25, 2012 (or, if Gannett has made the Gannett CNP Contribution, any Dissolution Event occurring at any time subsequent to seven years and one day after the CNP Contribution Date), in the absence of an election pursuant to Sections 10.1(b) or 10.2 hereof to continue the business of the Partnership, the Dissolution Committee shall, unless otherwise agreed to by the Partners, make an in kind distribution of the assets of the Gannett Designated Newspapers to Gannett and an in kind distribution of the MediaNews Newspapers to MediaNews. In liquidating the Partnership, the Dissolution Committee, in its reasonable discretion, shall apply the assets of the Partnership as provided in Sections 10.3(b) and (c), except that the Dissolution Committee may require liabilities of the Partnership associated with a newspaper of the Partnership that is distributed in kind to not be paid and instead to be assumed by the Partner that is to receive the in kind distribution of such newspaper assets. Any Partner receiving an in kind distribution of newspaper assets shall enter into a reasonable and customary cross-indemnification agreement in favor of the Partnership and the other Partner(s) with respect to the liabilities of the newspaper that is distributed in kind, in form and substance reasonably acceptable to the Dissolution Committee. The Dissolution Committee, in its capacity as liquidator, (x) shall have the right to compel each Partner to contribute an appropriate amount of cash to the Partnership to the extent necessary to equalize the relative values of the newspaper assets to be distributed in kind to the Partners, and /or (y) shall distribute an appropriate amount of cash to address any differences in the relative values of assets (taking into account any assumed liabilities) and cash distributed to the Partners. Prior to making any liquidating distributions, the Dissolution Committee shall furnish each of the Partners with a statement that shall set forth the values of the assets and liabilities of the Partnership as of the date of dissolution and as of the date of the planned liquidation, the share of each Partner thereof and a description of the newspaper assets and/or cash that each Partner is to receive as its liquidating distribution, the amount of cash (if any) that is to be contributed by any Partner, and a reasonably detailed report of the manner of disposition of the assets of the Partnership, and such statement and report shall be final and binding on the Partners and the Partnership. If, however, the Dissolution Committee is unable to agree upon the terms of such statement and report within thirty (30) days after the date of the applicable Dissolution Notice, the fair market values of the assets of the Partnership shall be determined consistent with the approach set forth in Section 9.5(f),

36

and the Dissolution Committee shall distribute the property and/or cash of the Partnership in accordance with such determination of values. The unanimous determination of the Dissolution Committee as to the value of each of the Partnership’s assets, or the determination of the appraisers appointed pursuant to Section 9.5(f), as applicable, shall conclusively establish the value of the Partnership’s properties and shall be final and binding upon the Partners and the Partnership. From and after the date of the applicable Dissolution Notice, each of the Partners and their Affiliates will, at their expense, (1) execute and deliver to the other Partners and the Partnership such documents and take such actions as the Dissolution Committee may reasonably request in order to effect such dissolution and winding up of the affairs of the Partnership; and (2) use all reasonable efforts to obtain any third party consents or approvals (including, but not limited to, approvals of governmental authorities) which may be necessary in connection with the dissolution and winding up of the affairs of the Partnership.

ARTICLE XI
AMENDMENT TO AGREEMENT

     Amendments to this Agreement and to the Certificate of Formation of the Partnership shall be approved in writing by all of the Partners. An amendment shall become effective as of the date specified in the Partners’ approval or if none is specified as of the date of such approval or as otherwise provided in the Act.

ARTICLE XII
INDEMNIFICATION

     12.1 General. From and after the Closing, the Partners shall indemnify each other as provided in this Article XII. As used in this Agreement, the term “Damages” shall mean all liabilities, demands, claims, actions or causes of action, regulatory, legislative or judicial proceedings or investigations, assessments, levies, losses (including, without limitation, any adverse tax consequences to other parties arising directly or indirectly from a violation of a covenant in this Agreement by a party and reduction in profits and diminution in the value of an interest in the Partnership), fines, deficiencies, interest, penalties, damages, judgments, costs and expenses, including, without limitation: reasonable attorneys’, accountants’, investigators’, and experts’ fees and expenses sustained or incurred in connection with the defense or investigation of any such claim.

     12.2 Indemnification Obligations. Notwithstanding any other provision of this Agreement, each party (an “Indemnifying Party”) shall defend, indemnify, save and keep harmless the other Partners, their Affiliates, the Partnership, York LLC and their respective successors and permitted assigns (collectively, the “Indemnified Parties”) against and from any and all Damages sustained or incurred by any of them resulting from or arising out of or by virtue of:

37

          (a) any breach of any representation or warranty made by the Indemnifying Party in this Agreement;

          (b) any breach by the Indemnifying Party of, or failure by the Indemnifying Party to comply with, any of its covenants or obligations under this Agreement (including, without limitation, their obligations under this Article XII); or

          (c) any indemnification obligation of such party or any Affiliate thereof arising under the provisions of Article X of the Contribution Agreement.

     Except as provided in the succeeding two paragraphs of this Section 12.2, any indemnification obligation arising under this Article XII and/or Article X of the Contribution Agreement shall be discharged by a capital contribution by the Partner owing such obligation to the Partnership in the amount of the Damages relating thereto. Any payment by the Partnership of Damages to which an indemnification obligation relates shall be charged as a distribution to the Indemnifying Partner and taken into account for purposes of current and future distributions made by the Partnership pursuant to Section 5.1. In addition, no item of Partnership property shall be revalued to reflect such indemnification payment. From the date of determination of such obligation (which shall be the date agreed by the parties or the date of a final binding determination by a mediator or the date of a final, non-appealable determination by a court of competent jurisdiction, as applicable) and until such obligation (and all accrued interest, if any, with respect thereto) has been paid in full in cash or other immediately available funds, all cash distributions to which a Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such capital contribution and to pay accrued but unpaid interest as provided in Section 3.1(c) hereof.

     Notwithstanding any other provision of this Agreement to the contrary, in the event any indemnification obligation arises under Section 10.6 of the Contribution Agreement and Gannett reasonably determines that such claim is likely to result in Damages which would impact more than one fiscal year of the Partnership (each, a “York Indemnity Claim”), Gannett shall have the option to invoke the remedy described in this paragraph with respect to such York Indemnity Claim in lieu of the remedies described in the immediately preceding paragraph of this Section. Such option may be exercised by Gannett, in its sole discretion, by providing written notice to the Partnership and MediaNews (each, a “Gannett Claim Notice”), within thirty (30) days of any such determination, which sets forth with reasonable specificity the basis for the claim for indemnification, the nature of the claim and the basis and methodology for calculating the amount of the proposed reduction in the MediaNews Percentage Interest and the proportionate increase in the Gannett Percentage Interest as a result of such York Indemnity Claim. The parties agree that of MediaNews’ 59.36% Percentage Interest, a 29.50% Percentage Interest shall be treated by the parties as being attributable to the contribution of the York Partnership Interest to the Partnership pursuant to Section 2.5(a) of the Contribution Agreement. With respect to any York Indemnity Claim subject to a Gannett Claim Notice, the parties agree that MediaNews’ Percentage Interest shall be adjusted to the following percentage: (I) the sum of (a) the excess of 59.36 over 29.50 plus (b) the product of 29.50 times a fraction, the numerator

38

of which is the fair market value of the York Partnership Interest on the date of the Gannett Claim Notice (taking into account all Damages resulting from or arising out of or by virtue of such York Indemnity Claim, including, but not limited to, the adverse effect, on a present value basis, of any changes which impact the subsequent business or operations of the York Limited Partnership) and the denominator of which is the fair market value of the York Partnership Interest immediately prior to the date that such indemnification obligation first arose (for purposes of clarification, this fraction cannot be greater than 1), divided by (II) 100 plus the amount described in (I)(b) above minus 29.50.

     If MediaNews objects to the proposed reduction in the MediaNews Percentage Interest set forth in the Gannett Claim Notice, MediaNews shall notify Gannett in writing of the basis for its objection within fifteen (15) business days after receipt of the Gannett Claim Notice and, pursuant to the procedures set forth in Section 13.1 hereof (except that no further written notice of the matter in dispute shall be required), the parties shall attempt to agree upon the fair market values of the York Partnership Interests for purposes of the applicable fraction set forth above. If the parties are unable to agree on the fair market values of the York Partnership Interest pursuant to Section 13.1, then MediaNews shall select an independent qualified appraiser (with the concurrence of Gannett, which concurrence shall not be unreasonably withheld) to determine the fair market values of the York Partnership Interests for purposes of the applicable fraction set forth above, and the parties shall abide by the conclusions of such appraiser which shall be final and binding upon the parties. The Partnership shall pay the fees of any such appraiser. Any indemnification obligation with respect to a York Indemnification Claim subject to a Gannett Claim Notice shall be discharged upon a reduction in the MediaNews Percentage Interest and proportionate increase in the Gannett Percentage Interest pursuant to this paragraph, and such discharge shall be effective as of the date of the applicable Gannett Claim Notice. Notwithstanding the preceding sentence, from and after the date of any Gannett Claim Notice, unless otherwise agreed by the parties, all cash distributions to which MediaNews shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof shall continue to be distributed to MediaNews until (i) MediaNews has made an additional capital contribution to the Partnership pursuant to the next paragraph of this Section or (ii) MediaNews has failed to exercise its option to make an additional capital contribution to the Partnership within the 30-day period referenced in the next paragraph of this Section, in either of which events, any future distributions to which MediaNews would otherwise be entitled to receive pursuant to Section 5.1(a) hereof shall be equitably adjusted (including accrued interest at a rate of 5% per annum), retroactive to the date of the Gannett Claim Notice, to take into account the period during which the MediaNews Percentage Interest was reduced from and after the date of the Gannett Claim Notice.

     If, as a consequence of Gannett’s invoking the remedy described in the preceding two paragraphs of this Section, the Percentage Interest of MNG and its Affiliates would be decreased to less than 51%, MediaNews shall have the option, exercisable by written notice to Gannett within 30 days of a final determination of the amount by which MediaNews’ Percentage Interest is to decrease pursuant to the preceding two paragraphs, to contribute to the Partnership additional newspapers,

39

mastheads or related assets owned by it, provided that any such proposed additional capital contribution shall be subject to Gannett’s reasonable concurrence, which such concurrence shall not be unreasonably withheld; and provided, further, that no such proposed additional capital contribution shall cause Gannett’s Percentage Interest to be decreased to a level of less than 90% of the Gannett Percentage Interest which was in effect immediately prior to the date of the Gannett Claim Notice which gave rise to such reduction in MediaNews’ Percentage Interest, without obtaining the prior written consent of Gannett, which may be withheld in Gannett’s sole discretion. Upon receipt by the Partnership of an additional capital contribution pursuant to this paragraph, the Capital Account and Percentage Interest of the contributing Partner(s) will be adjusted upward to reflect the fair market value of such contribution (determined in accordance with the procedures set forth in Section 9.5(f)) and, subject to the terms of the immediately preceding sentence, the Percentage Interest of the other Partner(s) will be adjusted downward proportionately to reflect the increase in the contributing Partner’s Percentage Interest.

     12.3 Exclusive Remedy. The sole and exclusive remedy of Indemnified Parties with respect to any and all claims relating to the subject matter of this Agreement shall be pursuant to the indemnification provisions set forth in this Article XII and the Contribution Agreement.

     12.4 Third Party Claims. Promptly following the receipt of notice of any claim for Damages or for equitable relief which are asserted or threatened by a party other than the parties hereto, their successors or permitted assigns (a “Third Party Claim”), the party receiving the notice of the Third Party Claim shall (a) notify the other Partners in writing in accordance with Section 13.2 hereof of its existence setting forth with reasonable specificity the facts and circumstances of which such party has received notice and (b) if the party giving such notice is an Indemnified Party, specifying the basis hereunder upon which the Indemnified Party’s claim for indemnification is asserted. No failure to give notice of a claim shall affect the indemnification obligations of the Indemnifying Party hereunder, except to the extent that the Indemnifying Party can demonstrate that such failure materially prejudiced such Indemnifying Party’s ability to successfully defend the matter giving rise to the claim. The Indemnified Party shall tender the defense of a Third Party Claim to the Indemnifying Party.

     The Indemnified Party shall not have the right to defend or settle such Third Party Claim. The Indemnified Party shall have the right to be represented by counsel at its own expense in any such contest, defense, litigation or settlement conducted by the Indemnifying Party; provided, however, that with respect to any claim under Section 10.6 of the Contribution Agreement, the Indemnifying Party shall be solely responsible for the fees and expenses of outside counsel retained by the Indemnified Party to represent the Indemnified Party in any such contest, defense, litigation or settlement. The Indemnifying Party shall lose its right to defend and settle the Third Party Claim if it shall fail to diligently contest the Third Party Claim. So long as the Indemnifying Party has not lost its right and/or obligation to defend and settle as herein provided, the Indemnifying Party shall have the right to contest, defend and litigate the Third Party Claim and shall have the right, in its discretion exercised in good faith, and upon the

40

advice of counsel, to settle any such matter, either before or after the initiation of litigation, at such time and upon such terms as it deems fair and reasonable; provided that in any event the Indemnifying Party shall consult with the Indemnified Party with respect to settling such matter which decision shall be made by mutual agreement of the Indemnifying Party and the Indemnified Party, not to be unreasonably withheld by either. All expenses (including without limitation attorneys’ fees) incurred by the Indemnifying Party in connection with the foregoing shall be paid by the Indemnifying Party. Notwithstanding the foregoing, in connection with any settlement negotiated by an Indemnifying Party, no Indemnified Party shall be required by an Indemnifying Party to (w) enter into any settlement that does not include as an unconditional term thereof the delivery by the claimant or plaintiff to the Indemnified Party of a release from all liability in respect of such claim or litigation, (x) enter into any settlement that attributes by its terms liability to the Indemnified Party, (y) consent to the entry of any judgment that does not include as a term thereof a full dismissal of the litigation or proceeding with prejudice or (z) enter into any settlement which would, or could reasonably be expected to, result in or relate to either a material nonmonetary obligation or restriction of any kind whatsoever being imposed upon the Indemnified Party or Damages other than Damages which are indemnifiable under this Article XII; provided, however, that the Indemnifying Party may enter into the settlements described in (w) and (y) above if (1) such settlement is not in any way materially damaging or harmful to the Partnership’s business or the Indemnified Parties, as the case may be, and (2) the Indemnifying Party agrees to remain liable to the Indemnified Party for indemnification with respect to such claim indefinitely thereafter. No failure by an Indemnifying Party to acknowledge in writing its indemnification obligations under this Article XII shall relieve it of such obligations to the extent they exist. If an Indemnified Party is entitled to indemnification against a Third Party Claim, and the Indemnifying Party fails to accept the defense of a Third Party Claim tendered pursuant to this Section 12.4, the Indemnifying Party shall lose its right to contest, defend, litigate and settle such a Third Party Claim; provided that the Indemnifying Party shall be entitled to participate, at its expense, with counsel of its choice, and any settlement shall be approved by the Indemnifying Party, such approval not to be unreasonably withheld, the Indemnified Party shall have the right, without prejudice to its right of indemnification hereunder, in its discretion exercised in good faith and upon the advice of counsel, to contest, defend and litigate such Third Party Claim, and subject to the preceding sentence may settle such Third Party Claim, either before or after the initiation of litigation. If, pursuant to this Section 12.4, the Indemnified Party so defends or (except as hereinafter provided) settles a Third Party Claim, for which it is entitled to indemnification hereunder, as hereinabove provided, the Indemnified Party shall be reimbursed by the Indemnifying Party for the reasonable attorneys’ fees and other expenses of defending the Third Party Claim which is incurred from time to time, forthwith following the presentation to the Indemnifying Party of itemized bills for said attorneys’ fees and other expenses.

     12.5 Other Indemnification Claims. The Indemnified Party shall give the Indemnifying Party prompt notice of any Indemnification Claim (other than a Third Party Claim) specifying the basis hereunder upon which the Indemnified Party’s claim for indemnification is asserted. No failure to give notice of a claim shall affect the indemnification obligations of the Indemnifying Party hereunder, except to the extent

41

that the Indemnifying Party can demonstrate that such failure materially prejudiced such Indemnifying Party’s ability to successfully defend or otherwise respond to the matter giving rise to the claim. In respect of any Indemnification Claim other than a Third Party Claim, the Partnership shall provide the Indemnifying Party with the opportunity and all appropriate access to the applicable facilities, personnel, books and records necessary to respond to such Indemnification Claim.

ARTICLE XIII
GENERAL PROVISIONS

     13.1 Mediation. Each Partner agrees that, in the event of any dispute among such Partners regarding the interpretation or application of any provision of this Agreement other than with respect to a potential reduction in the Percentage Interest of MNG and its Affiliates pursuant to the procedures set forth in Section 12.2 of this Agreement (including any dispute regarding the operation of the Partnership that cannot be resolved by the procedures created by the provisions of this Agreement), it will follow the following procedures:

          (a) it will give each other Partner written notice of the matter in dispute;

          (b) it will negotiate reasonably and in good faith with the other Partners in order to resolve such dispute for a period of not less than fifteen (15) business days following receipt of the notice in (a);

          (c) if the dispute has not been resolved by negotiation pursuant to (b), it will cooperate with the other Partners to submit the dispute to an independent mediator (to be selected by the unanimous consent of the Partners, which shall only be withheld on the basis of good faith concerns about the independence or adequacy of expertise of the proposed mediator) who shall have ten (10) business days after the matter is fully submitted to him or her to propose a settlement of the dispute;

          (d) if any Partner refuses, in its sole and unreviewable discretion to accept the proposed resolution of the mediator, it shall give prompt written notice of such refusal to the other Partners and, at any time following receipt of any such notice, any Partner shall be free to pursue any legal, equitable or other remedies available to it regarding the matter in dispute.

     Notwithstanding the foregoing, no Partner shall be required to pursue the notice, negotiation or mediation steps set forth above if it determines, reasonably and in good faith, the delay involved in such procedure would cause irreparable, material harm to it or its interest in the Partnership.

     13.2 Notices. Unless otherwise specifically provided in this Agreement, all notices and other communications required or permitted to be given hereunder shall be in writing, directed or addressed to the respective addresses set forth in Schedule 13.2 attached hereto, and shall be either (i) delivered by hand, (ii) delivered by a nationally recognized commercial overnight delivery service, (iii) mailed postage prepaid by registered or certified mail, or (iv) transmitted by facsimile, with receipt confirmed. Such notices shall be effective: (a) in the case of hand deliveries when received; (b) in the

42

case of an overnight delivery service, when received in accordance with the records of such delivery service; (c) in the case of registered or certified mail, upon the date received by the addressee as determined by the U.S. Postal Service; and (d) in the case of facsimile notices, when electronic indication of receipt is received. Any party may change its address and facsimile number by written notice to the other parties given in accordance with this Section 13.2.

     13.3 Confidentiality. Each of the Partners agrees that, except as required by law, legal process, government regulators, or as reasonably necessary for performance of its obligations or enforcement of its rights under this Agreement, without the prior written consent of the other Partners, it will treat and hold as confidential (and not disclose or provide access to any person other than such Partner’s attorneys or accountants) and it will cause its Affiliates, officers, managers, partners, employees and agents to treat and hold as confidential (and not divulge or provide access to any person) all information relating to (i) the business of the Partnership and (ii) any patents, inventions, designs, know-how, trade secrets or other intellectual property relating to the Partnership, in each case excluding (A) information in the public domain when received by such Partner or thereafter in the public domain through sources other than such Partner, (B) information lawfully received by such Partner from a third party not subject to a confidentiality obligation and (C) information developed independently by such Partner. The obligations of the Partners hereunder shall not apply to the extent that the disclosure of information otherwise determined to be confidential is required by applicable law, provided, however, that prior to disclosing such confidential information to any party other than a governmental agency exercising its ordinary regulatory oversight of a Partner, a Partner shall notify the Partnership thereof, which notice shall include the basis upon which such Partner believes the information is required to be disclosed. This Section 13.3 shall survive for a period of four years with respect to any Partner that withdraws from the Partnership and, with respect to any dissolution or termination of the Partnership pursuant to Article X hereof, for a period of time agreed by the all of Partners.

     13.4 Entire Agreement, Etc. This Agreement, together with the Contribution Agreement, constitutes the entire agreement among all of the parties hereto relating to the subject matter hereof and supersedes all prior contracts, agreements and understandings among all of them. No course of prior dealings among all of the parties shall be relevant to supplement or explain any term used in the Agreement. Acceptance or acquiescence in a course of performance rendered under this Agreement shall not be relevant to determine the meaning of this Agreement even though the accepting or the acquiescing party has knowledge of the nature of the performance and an opportunity for objection. All waivers, amendments and modifications of this Agreement must be in writing, executed by a duly authorized officer of the party against whom enforcement of any waiver, modification or consent is sought. No waiver of any terms or conditions of this Agreement in one instance shall operate as a waiver of any other term or condition or as a waiver in any other instance.

     13.5 Construction Principles. As used in this Agreement words in any gender shall be deemed to include all other genders. The singular shall be deemed to include

43

the plural and vice versa. The captions and article and section headings in this Agreement are inserted for convenience of reference only and are not intended to have significance for the interpretation of or construction of the provisions of this Agreement.

     13.6 Counterparts. This Agreement may be executed in two or more counterparts by the parties hereto, each of which when so executed will be an original, but all of which together will constitute one and the same instrument.

     13.7 Severability. If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way unless such invalid or unenforceable provision or clause shall be so significant as to materially affect the parties’ expectations regarding this Agreement. Otherwise, the parties hereto agree to replace any invalid or unenforceable provision with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision.

     13.8 Expenses. The Initial Partners each agree to bear their own costs for all matters involved in the negotiation, execution and performance of this Agreement and related transactions unless otherwise specified herein.

     13.9 Governing Law and Venue. The validity and construction of this Agreement shall be governed by the internal laws (and not the principles of conflict of laws) of the State of Delaware. Subject to the provisions of this Agreement with respect to the resolution by the parties hereto of disputes hereunder pursuant to the mediation provisions herein set forth, any legal action or proceeding with respect to this Agreement may be brought in the courts of the State of Delaware and, by execution and delivery of this Agreement, each of the parties hereto hereby accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts. Each of the parties hereto hereby waives, and agrees not to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement of this Agreement, that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in said courts or that this Agreement may not be enforced in or by said courts or that its property is exempt or immune from execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or (provided that process shall be served in any manner referred to in the following sentence) that service of process upon such party is ineffective. Each of the parties hereto agrees that service of process in any such action, suit or proceeding against it with respect to this Agreement may be made upon it in any manner permitted by the laws of the State of Delaware or the federal laws of the United States or as follows: (i) by personal service or by certified or registered mail to the party’s designated agent for such service in such state, or (ii) by certified or registered mail to the party at its address set forth in Schedule 13.2 herein. Service of process in any manner referred to in the preceding sentence shall be deemed, in every respect, effective service of process upon such party.

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     13.10 Binding Effect. Subject to the provisions of this Agreement relating to transferability, this Agreement shall be binding upon, and inure to the benefit of, the Partners and their respective permitted distributees, heirs, successors and assigns.

     13.11 Additional Documents and Acts. Each Partner agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions, and conditions of this Agreement and of the transactions contemplated hereby.

     13.12 No Third Party Beneficiary. This Agreement is made solely for the benefit of the parties hereto and their permitted distributees, heirs, successors and assigns and no other person shall have any rights, interest, or claims hereunder or otherwise be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise.

     13.14 Waiver of Jury Trial. Each of the parties hereto hereby waives trial by jury in any action, proceeding or counterclaim brought by or against it on any matters whatsoever arising out of or in any way connected with this Agreement.

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     IN WITNESS WHEREOF, each Partner has duly executed this Amended and Restated Partnership Agreement as of the date set forth above.

Gannett Texas L.P.
By:	Gannett Satellite Information Network, Inc.
	Its General Partner
By:
	Daniel S. Ehrman, Jr.
	Authorized Representative
Northwest New Mexico Publishing Company
By:
	Ronald A. Mayo
	Vice President and Chief Financial Officer

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Schedule 1.1(a)

List of Gannett Designated Newspapers

[to be specified in the Gannett Notice in accordance with Section 8.11(b) of the Second
Amended and Restated Partnership Agreement]

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Schedule 1.1(b)

List of MediaNews Newspapers

[the Partnership’s newspapers and, if Gannett has made or committed to make the
Gannett CNP Contribution, the Gannett CNP Interest, other than the Gannett
Designated Newspapers]

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Schedule 13.2

Addresses for Notices

Gannett

Gannett Texas L.P.
c/o Gannett Co., Inc.
7950 Jones Branch Drive
McLean, VA 22107
Attn: Daniel S. Ehrman, Jr.
Fax No.: (703) 854-2042

with a copy to:

Gannett Co., Inc.
7950 Jones Branch Drive
McLean, VA 22107
Attn: Todd A. Mayman, Esq.
Fax No.: (703) 854-2035

MediaNews

Northwest New Mexico Publishing Company
c/o MediaNews Group, Inc.
1560 Broadway, Suite 2100
Denver, CO 80202
Attn: Joseph J. Lodovic, IV, President
Fax No.: (303) 894-9327

with a copy to:

Howell E. Begle, Jr. and James Modlin
Hughes Hubbard & Reed LLP
1775 I Street, NW, Suite 600
Washington, DC 20006
Fax No.: (202) 721-4646

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EX-10.22

Exhibit 10.22

Third Amended and Restated

Partnership Agreement

For

California Newspapers Partnership
A Delaware General Partnership

By and Among

West Coast MediaNews LLC

Stephens California Media

The Sun Company of San Bernardino, California

California Newspapers, Inc.

Media West—SBC, Inc.

And

Media West—CNI, Inc.

August 2, 2006

TABLE OF CONTENTS

ARTICLE I DEFINITIONS
ARTICLE II THE PARTNERSHIP
2.1	Formation	7
2.2	Name	8
2.3	Business Purpose	8
2.4	Registered Office and Agent	8
2.5	Term	8
2.6	Principal Place of Business	8
2.7	Title to Partnership Property	8
2.8	The Partners	8
2.9	Fiscal Year	9
2.10	Representations and Warranties of the Parties	9
ARTICLE III CAPITAL STRUCTURE AND CONTRIBUTIONS
3.1	Capital Contributions	10
3.2	No Other Mandatory Capital Contributions	12
3.3	No Right of Withdrawal	12
3.4	Loans by Third Parties	12
ARTICLE IV CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES
4.1	Capital Accounts	12
4.2	Book Allocation	12
4.3	Tax Allocations	13
ARTICLE V DISTRIBUTIONS
5.1	Distributions	14
ARTICLE VI ACCOUNTING AND REPORTS
6.1	Books and Records	15
6.2	Reports to Partners	16
6.3	Annual Tax Returns	16
6.4	Actions in Event of Audit	17
6.5	Tax Elections	18
ARTICLE VII ACTIONS BY PARTNERS
7.1	Consents and Other Actions by Sun, California Newspapers, MWSBC and MWCNI	18
7.2	Meetings	18

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7.3	Actions by the Partners	18
ARTICLE VIII MANAGEMENT
8.1	The Management Committee	18
8.2	Removal of Members; Vacancies	19
8.3	Meetings of the Management Committee; Notice	19
8.4	Quorum	20
8.5	Voting	20
8.6	Certain Matters Requiring a Unanimous Vote of the Management Committee	20
8.7	Action by Consent	21
8.8	Executive Officers	22
8.9	Provision of Services to Partnership by MediaNews	22
8.10	MediaNews Change in Control	23
ARTICLE IX TRANSFER OF PARTNERSHIP INTERESTS; ADDITIONAL AND SUBSTITUTE PARTNERS
9.1	Prohibited Transfers	24
9.2	Permitted Transfers by Partners	24
9.3	Substitute Partner	24
9.4	Involuntary Withdrawal by a Partner	25
9.5	Right of First Refusal for Sale of Partnership Interests	25
9.6	Tag-Along Rights Regarding Sales of Partnership Interests	27
9.7	West Coast MediaNews Drag-Along Rights	28
9.8	Admission of Additional Partners	29
9.9	SCM Put Option	29
9.10	Reserved	30
9.11	Partnership Call Option Re Section 9.9 Put Option	30
9.12	Acknowledgment of Pledges of Interests	31
ARTICLE X DISSOLUTION AND LIQUIDATION
10.1	Dissolution	32
10.2	Election to Continue the Business	33
10.3	Closing of Affairs	33
ARTICLE XI AMENDMENT TO AGREEMENT
ARTICLE XII INDEMNIFICATION
12.1	General	34
12.2	Indemnification Obligations	34
12.3	Exclusive Remedy	35
12.4	Third Party Claims	35
12.5	Other Indemnification Claims	36

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ARTICLE XIII GENERAL PROVISIONS
13.1	Mediation	37
13.2	Notices	37
13.3	Confidentiality	38
13.4	Entire Agreement, Etc	38
13.5	Construction Principles	38
13.6	Counterparts	38
13.7	Severability	39
13.8	Expenses	39
13.9	Governing Law	39
13.10	Binding Effect	39
13.11	Additional Documents and Acts	39
13.12	No Third Party Beneficiary	39
13.13	Formation of Subsidiary Limited Partnership	39

Exhibits

Exhibit 1 Schedule of Certain Partnership Assets and Liabilities Transferred to Subsidiary Limited Partnership.

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THIRD AMENDED AND RESTATED PARTNERSHIP AGREEMENT

FOR

CALIFORNIA NEWSPAPERS PARTNERSHIP
A DELAWARE GENERAL PARTNERSHIP

     THIS THIRD AMENDED AND RESTATED PARTNERSHIP AGREEMENT of California Newspapers Partnership, a Delaware general partnership (the “Partnership”) is made and entered into as of this 2nd day of August, 2006 by and among West Coast MediaNews LLC, a Delaware limited liability company (“West Coast MediaNews”), Stephens California Media LLC (f/k/a Donrey Newspapers LLC), an Arkansas limited liability company (“SCM”), The Sun Company of San Bernardino, California, a California corporation (“Sun”), California Newspapers, Inc., a California corporation (“California Newspapers”), Media West—SBC, Inc., a Delaware corporation (“MWSBC”), Media West—CNI, Inc., a Delaware corporation (“MWCNI,” with Sun, California Newspapers, MWSBC and MWCNI being sometimes hereinafter collectively referred to as “Gannett”) and each other individual or business entity who may hereafter be admitted from time to time as a Partner hereunder. West Coast MediaNews, SCM, Sun, California Newspapers, MWSBC and MWCNI and any other individual and/or business entity subsequently admitted shall be known as and referred to as “Partners” and individually as a “Partner”.

RECITALS

     WHEREAS, the Partnership was formed as a general partnership under the laws of the State of Delaware as of March 31, 1999;

     WHEREAS, a Partnership Agreement was entered into by West Coast MediaNews, SCM, Sun and MWSBC dated as of March 31, 1999 and was amended and restated pursuant to an Amended and Restated Partnership Agreement dated as of September 30, 2000;

     WHEREAS, the Amended and Restated Partnership Agreement was amended and restated pursuant to a Second Amended and Restated Partnership Agreement dated as of May 20, 2003 (as so amended, the “Second Amended and Restated Partnership Agreement”); and

     WHEREAS, the Partners desire to further amend and restate the Second Amended and Restated Partnership Agreement as of the date hereof;

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter expressed, the Partners agree as follows:

ARTICLE I
DEFINITIONS

     “Additional Capital Contributions” means any additional Capital Contributions made pursuant to Section 3.1(b) of this Agreement.

     “Additional Contribution Terms” shall have the meaning ascribed to it in Section 3.1(b) of this Agreement.

     “Additional Partner” means any additional person admitted to the Partnership, pursuant to Section 9.8 of this Agreement, but does not include a Substitute Partner.

     “Affiliate” means any person controlled by, controlling, or under common control with the entity in question. The parties understand and agree that TNP shall be deemed an Affiliate of Gannett (and an Affiliate of each of Sun, California Newspapers, MWSBC and MWCNI) in connection with any Transfer to TNP.

     “Book Value” means, with respect to any asset of the Partnership, the adjusted basis of such asset as of the relevant date for federal income tax purposes, except as follows:

          (i) the initial Book Value of any asset contributed by a Partner to the Partnership shall be the fair market value of such asset;

          (ii) the Book Values of all Partnership assets (including intangible assets such as goodwill) shall be adjusted to equal their respective fair market values as of the following times:

               (A) the acquisition of an additional Interest in the Partnership by any new or existing Partner in exchange for more than a de minimis Capital Contribution;

               (B) the distribution by the Partnership to a Partner of more than a de minimis amount of money or Partnership property as consideration for an Interest in the Partnership; and

               (C) the liquidation of the Partnership within the meaning of Regulation section 1.704-1(b)(2) (iv)(f)(5)(ii);

          (iii) the Book Value of the Partnership assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code section 734(b) or Code section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulation section 1.704-1(b)(2)(iv)(m); and

          (iv) if the Book Value of an asset has been determined or adjusted pursuant to subsection (i), (ii) or (iii) above, such Book Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses and other items allocated pursuant to Section 4.2.

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     The foregoing definition of Book Value is intended to comply with the provisions of Regulation section 1.704–1(b)(2)(iv) and shall be interpreted and applied consistently therewith.

     “Business Day” means any day (other than a day which is a Saturday, Sunday or legal holiday in the State of California).

     “Business Plan” means the business plan for the Partnership for the period ending June 30, 1999, substantially in the form attached hereto as Schedule A, and as adopted annually thereafter by the Management Committee.

     “Capital Account” means, for each Partner, the capital account maintained by the Partnership for such Partner as described in Section 4.1.

     “Capital Contribution” means the amount of money and the other property (net of any liabilities that the Partnership is considered to assume, or take subject to, pursuant to Code Section 752, except to the extent such liabilities are in fact discharged by the Partners contributing such property) which is contributed by a Partner to the Partnership pursuant to Article III hereof, including Additional Capital Contributions.

     “Capital Expenditure” means all expenditures of a capital nature, including those in relation to the construction of enlargements or additions to any of the assets or facilities owned by the Partnership (including the Subsidiaries) or for any other acquisitions or improvements thereto of a capital nature, including, without limitation, expenditures for materials, labor, equipment permits, consulting fees, accounting and legal fees, insurance costs, contractors’ fees, and land and easement costs.

     “CNP EBITDA” means the sum of the Partnership’s (i) net income after taxes, plus (ii) interest expense that has been deducted in the determination of such net income, plus (iii) federal, state and local income taxes that have been deducted in determining such net income, plus (iv) depreciation and amortization expenses that have been deducted in determining such net income, in each case for the 12-month period ended immediately prior to the date of such determination, and determined on a basis consistent with GAAP, consistently applied.

     “Code” means the Internal Revenue Code of 1986, as currently amended.

     “Contribution Agreement” means that contribution agreement described in Section 3.1 of this Agreement.

     “Corporate Expenses of MNG” means, with respect to any Fiscal Year, all compensation, overhead (such as rent, utilities and travel), administrative expenses and other expenses relating to corporate level employees, including without limitation, those expenses relating to the following functions: finance and accounting, treasury, personnel/human resources, tax, legal, investor relations, IT (other than MNG’s internet division) and other corporate functions (such as sales, news, circulation, newsprint and other purchasing) supporting MNG’s operations generally.

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     “Depreciation” means, for each Fiscal Year or part thereof, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such Fiscal Year or part thereof, except that if the Book Value of an asset differs from its adjusted basis for federal income tax purposes, the depreciation, amortization or other cost recovery deduction for such Fiscal Year or part thereof shall be an amount which bears the same ratio to such Book Value as the federal income tax depreciation, amortization or other cost recovery deduction for such Fiscal Year or part thereof bears to such adjusted tax basis. If such asset has a zero adjusted tax basis, the depreciation, amortization or other cost recovery deduction for each Fiscal Year shall be determined under a method reasonably selected by the Tax Matters Partner.

     “Effective Date” means August 2, 2006.

     “Election Period” means either (i) the Transition Period plus 30 days thereafter, if a MNG Notice is received by Gannett during the Transition Period (and such MNG Notice has not been revoked by West Coast MediaNews), provided that Gannett shall have the right, exercisable in its sole discretion upon notice to the other Partners, to extend the Election Period until a date specified by Gannett occurring at any time during the fiscal year of Gannett Co., Inc. in which the Transition Period expires or the next succeeding fiscal year of Gannett Co., Inc.; or (ii) 30 days following receipt by Gannett of the MNG Notice, if a MNG Notice (which has not been revoked by West Coast MediaNews) is received by Gannett after the expiration of the Transition Period, provided that Gannett shall have the right, exercisable in its sole discretion upon notice to the other Partners, to extend the Election Period until a date specified by Gannett occurring at any time (A) during the fiscal year of Gannett Co., Inc. in which the MNG Notice is received by Gannett, or (B) during the next succeeding fiscal year of Gannett Co., Inc. In the case of either clause (i) or (ii) above, the Election Period shall automatically be extended by one day for each day which elapses during the period commencing on the date of the applicable MNG Notice and continuing until the date of consummation of the transaction referenced in the applicable MNG Notice.

     “Executive Officers” means the following officers of the Partnership: its president and chief executive officer, chief financial officer and any other individual who would be an “executive officer” of the Partnership as determined in accordance with Rule 3b-7 promulgated under the Securities Exchange Act of 1934.

     “Fair Market Value of the Offered Interest” is defined in Section 9.5(f)(ii).

     “Fiscal Year” means the fiscal year of the Partnership as defined in Section 2.9 hereof.

     “Formation Date” means March 31, 1999.

     “GAAP” means generally accepted accounting principles, as in effect from time to time.

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     “Gannett Election Notice” means written notice from Gannett to West Coast MediaNews and SCM of its intention to transfer all of its Interest in the Partnership to TNP pursuant to Section 8.10(b), which notice shall specify the date upon which such transfer shall become effective for all purposes of this Agreement.

     “Indebtedness” means those obligations for borrowed money which were assumed by the Partnership as a consequence of, or to which property of the Partnership was subject immediately following the Partner’s initial Capital Contributions, within the meaning of Section 3.1(a) hereof and any obligation of a Partner to pay money which has been assumed by the Partnership with the exception of any of the foregoing such obligations which are included on:

(i)	the working capital statement described in Section 4.5 of the Contribution Agreement dated as of March 3, 1999 by and among Garden State Newspapers, Inc. Alameda Newspapers, Inc., V & P Publishing, Inc., Internet Media Publishing, Inc., DR Partners, Media West – SBC, Inc. and The Sun Company of San Bernardino, California; or
(ii)	the Gannett Newspapers Working Capital Statement as defined in the Contribution Agreement dated as of September 15, 2000 by and among California Newspapers, Inc., Media West-CNI, Inc. and California Newspapers Partnership.

     “Interest” means, with respect to any Partner at any time, such Partner’s entire beneficial ownership interest in the Partnership and its property at such time, including such Partner’s Capital Account, voting rights (if any), and right to share in Profits and Losses, all items of income, gain, loss, deduction and credit, distributions and all other benefits of the Partnership as specified in this Agreement, together with such Partner’s obligations to comply with all of the terms of this Agreement.

     “Involuntary Transfer” shall have the meaning ascribed thereto in Section 9.4.

     “Majority” means the Partners having a majority of the Percentage Interests.

     “MediaNews Change in Control” means the occurrence of any transaction or series of transactions as a result of which (i) MNG and Permitted Holders no longer directly or indirectly hold in the aggregate more than 50% of the voting interests of West Coast MediaNews LLC, its successors and assigns, including any Affiliate which on or after the date hereof holds any Interest in the Partnership, or (ii) the sale or other disposition of all or substantially all of the assets of MNG or any of its Affiliates listed in clause (i) except for sales or other dispositions to MNG or any of its Affiliates and/or Permitted Holders, or (iii) a majority of the voting interests of MNG are acquired by a person or entity (or group of persons and entities acting in concert), whether structured as a merger, consolidation, reorganization, sale of stock or otherwise, other than Permitted Holders, in each case of clauses (i) or (ii), without the prior written consent of Gannett, not to be unreasonably withheld. No such approval shall be deemed to have

5

been withheld unreasonably if the proposed transferee (or those controlling the proposed transferee) does not have experience in and a good reputation within the newspaper publishing industry.

     “MNG” means MediaNews Group, Inc., a Delaware corporation, its successors and assigns.

     “MNG Notice” means written notice from West Coast MediaNews of a proposed MediaNews Change in Control pursuant to Section 8.10(a), which notice has not been withdrawn by West Coast MediaNews.

     “Percentage Interest” means, for each Partner, such Partner’s percentage interest as set forth in Section 3.1 hereof as such may be adjusted from time to time in accordance with this Agreement.

     “Permitted Holders” means (i) each of William Dean Singleton, Richard B. Scudder, Joseph J. Lodovic, IV and their respective spouses, ancestors, siblings, descendants (including children or grandchildren by adoption) and the descendants of any of their siblings; (ii) in the event of the incompetence or death of any of the persons described in clause (i), such person’s estate, executor, administrator, committee or other personal representative, in each case who at any particular date shall beneficially own or have the right to acquire, directly or indirectly, capital stock of MNG; (iii) any trust created for the benefit of the persons described in clause (i) or (ii) or any trust for the benefit of any such trust; or (iv) any person controlled by any of the persons described in clause (i), (ii) or (iii). For purposes of this definition, “control,” as used with respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, whether through ownership of voting securities or by contract or otherwise.

     “Permitted Transfer” means a transfer of Gannett’s Interest in the Partnership to TNP pursuant to Section 8.10(b).

     “Profits” and “Losses” means, for each Fiscal Year or part thereof, the taxable income or loss of the Partnership for such Fiscal Year determined in accordance with Code section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code section 703(a)(1) shall be included in taxable income or loss), with the following adjustments:

          (i) any income of the Partnership that is exempt from federal income tax shall be added to such taxable income or loss;

          (ii) any expenditures of the Partnership described in Code section 705(a)(2)(B) or treated as such pursuant to Regulation section 1.704-1(b)(2)(iv)(i) shall be subtracted from such taxable income or loss;

          (iii) any Depreciation for such Fiscal Year or part thereof shall be taken into account in lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss;

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          (iv) gain or loss resulting from any disposition of Partnership property with respect to which gain or loss is recognized for federal income tax purposes shall be computed with reference to the Book Value of the property disposed of, rather than the adjusted tax basis of such property;

          (v) in the event the Book Value of any Partnership asset is adjusted pursuant to section (ii) or (iii) of the definition of Book Value hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such assets for purposes of computing Profits and Losses; and

          (vi) such taxable income or loss shall be deemed not to include any income, gain, loss, deduction or other item thereof allocated pursuant to Section 4.3.

     “Regulations” means the income tax regulations promulgated under the Code by the Department of the Treasury, as such regulations may be amended from time to time.

     “Subsidiaries” means Contra Costa Newspapers, LLC, a Delaware limited liability company; The Hills Newspapers, LLC, a Delaware limited liability company; Community Newspapers, LLC, a Delaware limited liability company; Daily News Group, LLC, a Delaware limited liability company; Targeted Publications, LLC, a Delaware limited liability company; San Jose Mercury News, LLC, a Delaware limited liability company; and the successors and assigns of each of the foregoing entities.

     “Substitute Partner” means a person who has become a substitute Partner pursuant to Section 9.3 hereof, but does not include an Additional Partner.

     “TNP” means Texas-New Mexico Newspapers Partnership, a Delaware general partnership, its successors and assigns.

     “Transfer” means any sale, assignment, gift, alienation, or other disposition, whether voluntary or by operation of law (other than a transfer which may arise by reason of death or incapacity), of an interest or any portion thereof, but shall not include any pledge, hypothecation or granting of a security interest in such Interest.

     “Transferee” means a purchaser, transferee, assignee (other than collateral assignees) or any other person who takes, in accordance with the terms of this Agreement, an Interest in the Partnership.

     “Transition Period” means the period commencing on the Effective Date and ending on July 31, 2010.

ARTICLE II
THE PARTNERSHIP

     2.1 Formation. The parties hereto have formed a partnership in accordance with the further terms and provisions hereof. Each of the Partners shall execute or cause to be executed from time to time all other instruments, certificates, notices and documents, and shall do or cause to be done all such filing, recording, publishing and other acts, in each case, as may be necessary or appropriate from time to time to comply with all applicable requirements for the formation and/or operation and, when

7

appropriate, termination of a partnership in the State of Delaware and all other jurisdictions where the Partnership shall desire to conduct its business.

     2.2 Name. The name of the Partnership shall be “California Newspapers Partnership” and its business shall be carried on in this name with such variations and changes as the Management Committee, in its sole judgment, deems necessary or appropriate to comply with the requirements of the jurisdictions in which the Partnership’s operations are conducted.

     2.3 Business Purpose. The purpose of the Partnership is to carry on any lawful business and to engage in any lawful act or activity for which a partnership may be formed under the laws of the State of Delaware; provided, however, that the business of the Partnership shall, without the unanimous consent of the Management Committee, be limited to activities involving the ownership, operation, and publication (in printed and electronic form) of newspapers and related publications and business activities directly related or incidental to such ownership, operation and publication including, without limitation, commercial printing, alternate distribution services and direct mail activities.

     2.4 Registered Office and Agent. The registered office of the Partnership in the State of Delaware and its registered agent for service of process on the Partnership in the State of Delaware shall be as determined by the Management Committee.

     2.5 Term. The term of the Partnership commenced on March 31, 1999 (the “Formation Date”) and shall continue until December 31, 2048 unless earlier dissolved and liquidated in accordance with Article XI hereof.

     2.6 Principal Place of Business. The Partnership shall maintain its principal place of business at 21221 Oxnard Street, Woodland Hills, California 91367 or such other location or locations as the Management Committee may from time to time select.

     2.7 Title to Partnership Property. Except as shown in Schedule B, legal title to all property of the Partnership other than leased property shall be held and conveyed in the name of the Partnership.

     2.8 The Partners. The name and place of residence of each Partner is as follows:

NAME	RESIDENCE
West Coast MediaNews	c/o MediaNews Group, Inc.
	1560 Broadway, Suite 2100
	Denver, CO 80202
SCM	c/o Stephens Group, Inc.
	11 Center Street, Suite 2500
	Little Rock, AR 72201-4430

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NAME	RESIDENCE
Sun	c/o Gannett Co., Inc.
	7950 Jones Branch Drive
	McLean, VA 22107
California Newspapers	c/o Gannett Co., Inc.
	7950 Jones Branch Drive
	McLean, VA 22107
MWSBC	50 W. Liberty Street
	Suite 802
	Reno, NV 89501
MWCNI	50 W. Liberty Street
	Suite 802
	Reno, NV 89501

     2.9 Fiscal Year. Unless the Tax Matters Partner shall otherwise determine in accordance with Section 706 of the Code, the fiscal year of the Partnership shall end on June 30 of each year, and the initial Fiscal Year of the Partnership commenced on the Formation Date and ended on June 30, 1999.

     2.10 Representations and Warranties of the Parties. Each of the parties represents and warrants that:

          (a) It is a corporation or limited liability corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization;

          (b) It has all requisite power and authority to enter into this Agreement; the execution and delivery by such party of this Agreement and the consummation by such party of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of such party; and this Agreement has been duly and validly executed and delivered by such party and constitutes (assuming the due and valid execution and delivery of this Agreement by the other parties), the legal, valid and binding obligation of each party, enforceable against each party in accordance with its terms;

          (c) There is no litigation pending or, to the best knowledge of such party, threatened against such party which has a reasonable likelihood of materially and adversely affecting the operations, properties or business of the Partnership or any of such party’s obligations under this Agreement;

          (d) The execution, delivery and performance by such party of this Agreement will not, as of and after the Effective Date, result in a breach of any of the terms, provisions or conditions of any agreement to which such party is a party which has a reasonable likelihood of materially and adversely affecting the operations,

9

properties or business of the Partnership or such party’s obligations under this Agreement;

          (e) The execution and delivery by such party of this Agreement and the formation of the Partnership does not require any filing by it with, or approval or consent of, any governmental authority which has not already been made.

ARTICLE III
CAPITAL STRUCTURE AND CONTRIBUTIONS

3.1 Capital Contributions.

          (a) Initial Contributions. Each of West Coast MediaNews, SCM, Sun and MWSBC has made a Capital Contribution to the Partnership as set forth in the Contribution Agreement among Garden State Newspapers, Inc., Alameda Newspapers, Inc., V&P Publishing, Inc., and Internet Media Publishing, Inc. (on behalf of West Coast MediaNews), DR Partners (on behalf of SCM), Sun and MWSBC (on behalf of Gannett), dated as of March 3, 1999 (the “Contribution Agreement”). Each of California Newspapers and MWCNI (on behalf of Gannett) has made a Capital Contribution as set forth in the Contribution Agreement among the Partnership, California Newspapers and MWCNI dated as of September 15, 2000 (also, for purposes of this Agreement, the “Contribution Agreement”). As of the Effective Date, the following Partners made (or will cause to be made) the following Capital Contributions, payable in cash, to pay for the Partnership’s acquisition of 100% of the outstanding membership interests of the Subsidiaries and related assets: $402,980,000 by West Coast MediaNews; $195,290,000 by SCM; $78,322,637 by Sun; $8,694,259 by MWSBC; $52,016,932 by California Newspapers; and $5,796,172 by MWCNI. As a result of such Capital Contributions, as of the Effective Date, West Coast MediaNews has (or will have) a Percentage Interest in the Partnership of 54.23%, SCM has (or will have) a Percentage Interest in the Partnership of 26.28%, Sun has (or will have) a Percentage Interest in the Partnership of 10.54%, MWSBC has (or will have) a Percentage Interest in the Partnership of 1.17%, California Newspapers has (or will have) a Percentage Interest in the Partnership of 7.00% and MWCNI has (or will have) a Percentage Interest in the Partnership of 0.78%. Percentage Interests shall not be adjusted on account of the payment of any sums, or the contribution of any property, treated as a Capital Contribution without the unanimous consent of the Partners.

          (b) Additional Capital Contributions. At any time, and from time to time after the Formation Date, the Management Committee, in its sole and absolute discretion, may, by unanimous vote, determine that the Partnership requires additional capital contributions (the “Additional Capital Contributions”) and the amount, terms and conditions thereof. Such Additional Capital Contributions will be used by the Partnership for such activities as are designated by the Management Committee in its approval resolution. All Additional Capital Contributions will be made by the Partners in proportion to their then-current Percentage Interests in the Partnership. In addition, with

10

the unanimous consent of the Management Committee, Additional Capital Contributions may be obtained by the admittance of Additional Partners in accordance with Section 9.8. In the event Additional Partners are admitted, the Percentage Interests of the existing and Additional Partners shall be adjusted as determined by the Management Committee, voting unanimously. From the date of the Management Committee’s determination that an Additional Capital Contribution is required until it has been paid, a Partner’s obligation to make that contribution shall accrue interest at a rate of 9% per annum until the obligation to make the Additional Capital Contribution (and to pay all accrued but unpaid interest, if any, with respect thereto) has been paid in full. All cash distributions to which such Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such Additional Capital Contribution (and to pay all accrued but unpaid interest, if any, with respect thereto). Any amounts so retained shall be treated as distributed to such Partner and, first paid to the Partnership in the amount of the accrued interest and, second, with respect to the remainder thereof, contributed to the Partnership as an Additional Capital Contribution on behalf of the Partner owing such obligation.

          (c) Capital Contributions Required Under Section 12.2. As provided in Section 12.2 of this Agreement, any Partner owing an indemnification obligation to the Partnership arising under Article XII of this Agreement shall make a capital contribution in cash or other immediately available funds in the amount of such obligation promptly upon the determination of such obligation. Furthermore, from the date of the determination of such obligation until the date such capital contribution is made in cash or other immediately available funds, the amount of such obligation shall accrue interest owing to the Partnership at a rate of 9 per cent per annum, and until such obligation (and all accrued interest, if any, with respect thereto) has been paid in full in cash or other immediately available funds, all cash distributions to which a Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such capital contribution and to pay accrued, but unpaid interest. Any amounts so retained shall be treated as distributed to such Partner and, first paid to the Partnership in the amount of the accrued interest and, second, with respect to the remainder thereof, contributed to the Partnership as an additional capital contribution on behalf of the Partner owing such obligation.

          (d) Other Contributions. At any time during the term of this Agreement, any Partner may offer to contribute to the Partnership as an additional capital contribution any newspapers, mastheads or related assets owned by it that are located in the State of California. Should the Management Committee, by a unanimous vote, agree to accept such contribution, the Capital Account and, if determined by unanimous vote of the Management Committee, as provided in Section 8.6 hereof, the Percentage Interest, of the contributing Partner will be adjusted upward to reflect the fair market value of such contribution (determined in accordance with the procedures set forth in Section 9.5(f)) and, if determined by unanimous vote of the Management Committee, as provided in Section 8.6 hereof, the Percentage Interest of the other Partners will be adjusted downward proportionately to reflect the increase in the contributing Partner’s Percentage Interest.

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     3.2 No Other Mandatory Capital Contributions. Except as specified in Section 3.1(b), Section 3.1(c) or Section 12.2, no Partner shall be obligated to make any Additional Capital Contribution to the Partnership’s capital.

     3.3 No Right of Withdrawal. No Partner shall have the right to withdraw any portion of such Partner’s Capital Contributions to, or to receive any distributions from, the Partnership, except as provided in Articles V, IX and X hereof.

     3.4 Loans by Third Parties. Subject to the provisions of Section 8.6 hereof, the Partnership may borrow funds or enter into other similar credit, guarantee, financing or refinancing arrangements for any purpose from any Partner or from any person upon such terms as the Management Committee determines, in its sole and absolute discretion, are appropriate.

ARTICLE IV
CAPITAL ACCOUNTS;
ALLOCATION OF PROFITS AND LOSSES

     4.1 Capital Accounts. Each Partner shall have a capital account (a “Capital Account”) which account shall be (1) increased by the amount of (a) the Capital Contributions of such Partner, (b) the allocations to such Partner of Profits and items of income or gain pursuant to Section 4.2, and (c) any positive adjustment to such Capital Account by reason of an adjustment to the Book Value of such Partner’s share of Partnership assets, and (2) decreased by the amount of (x) any cash and the Book Value of any property (net of liabilities secured by such property that such Partner is considered to assume or take subject to under Code section 752) distributed to such Partner, (y) the allocation to such Partner of Losses and items of loss pursuant to Section 4.2, and (z) any negative adjustment to such Capital Account by reason of an adjustment to the Book Value of such Partnership assets. In the event of a revaluation of the Book Value of Partnership assets, the Partners’ Capital Accounts shall be adjusted in the same manner as if gain or loss had been recognized on a sale of the assets at their new Book Value. The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulation section 1.704-1(b), and shall be interpreted and applied in a manner consistent with such Regulation.

     4.2 Book Allocation.

          (a) In General. This Section 4.2 sets forth the general rules for book allocations of Profits, Losses and similar items to the Partners as reflected in their Capital Accounts.

          (b) Profits and Losses. Profits shall be allocated to the Partners in proportion to their Percentage Interests. Losses shall be allocated to the Partners in proportion to their Percentage Interests except that any interest expense or other deduction attributable to any Indebtedness (other than any depreciation or amortization deductions attributable to property which is contributed to the Partnership subject to such Indebtedness) and any deductions attributable to any indemnity payments

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described in Section 12.2 shall be allocated to the Partner that contributed property subject to such Indebtedness or such indemnity payment.

          (c) Special Rules.

               (i) Notwithstanding the general allocation rules set forth in Section 4.2(b), in the case of any deduction allocable to a “nonrecourse liability” (as that term is defined in Regulations Section 1.704-2(b)(3)) and any deduction allocable to a “partner nonrecourse liability” (as that term is defined in Regulations Section 1.704-2(b)(4)), and any minimum gain or partner minimum gain chargeback with respect thereto, shall be subject to the rules applicable thereto and described in Regulations Section 1.704-2.

               (ii) If in the opinion of independent tax counsel for the Partnership, it is necessary to provide special allocation rules in order to avoid a significant risk that a material portion of any allocation set forth in this Article IV would not be respected for federal income tax purposes, the Partners shall negotiate in good faith any amendments to this Agreement as, in the opinion of such counsel, are necessary or desirable, taking into account the interests of the Partners as a whole and all other relevant factors, to avoid or reduce significantly such risk to the extent possible without materially changing the amounts allocable and distributable to any Partner pursuant to this Agreement.

               (iii) If there is a change made, by unanimous vote of the Management Committee in accordance with the provisions of Section 8.6 hereof, in any Partner’s share of the Profits, Losses or other items of the Partnership during any Fiscal Year, allocations among the Partners shall be made in accordance with their interests in the Partnership from time to time during such Fiscal Year in accordance with Code section 706, using the closing-of-the-books method, except that Depreciation with respect to assets not contributed by a Partner shall be deemed to accrue ratably on a daily basis over the entire Fiscal Year during which the corresponding asset is owned by the Partnership.

               (iv) Except as otherwise provided in Sections 4.2(b) and 4.3(b)(i), each item of income, gain, loss, and deduction and all items governed by Code section 702(a) shall be allocated among the Partners in proportion to the allocation of Profits, Losses and other items to the Partners hereunder, provided that to the extent any gain recognized from any disposition of a Partnership asset is treated as ordinary income because it is attributable to the recapture of any depreciation or amortization, such ordinary income shall be allocated among the Partners in the same ratio as the prior allocations of Profits, Losses or other items that included such depreciation or amortization; in no event, however, shall any Partner be allocated ordinary income hereunder in excess of the gain otherwise allocable to each Partner.

     4.3 Tax Allocations.

          (a) In General. Except as set forth in Section 4.3(b), allocations for tax purposes of items of Profit, Loss and other items of income, gain, loss, deduction, credit and distribution therefor, shall be made in the same manner as allocations for book purposes set forth in Section 4.2. All such allocations pursuant to Section 4.3(b) shall

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be considered made solely for purposes of federal, state and local income taxes, and shall not affect or in any way be taken into account in computing any Partner’s Capital Account or share of Profits, Losses, other items or gain, deduction and distribution pursuant to any provision of this Agreement.

          (b) Special Rules.

               (i) Elimination of Book/Tax Disparities. In determining a Partner’s allocable share of Partnership taxable income, the Partner’s allocable share of each item of Profits and Losses shall be properly adjusted to reflect the difference between such Partner’s share of the adjusted tax basis and the Book Value of Partnership assets used in determining such item under any method adopted by the Tax Matters Partner and allowable under Code Section 704(c), provided, however, that any deductions for depreciation or amortization attributable to property contributed to the Partnership by a Partner shall be allocated to the Partner contributing such property (and, in the event Gannett transfers its Interest in the Partnership to TNP pursuant to Section 8.10(b), any such deductions that otherwise would have been allocated to Gannett in the absence of such a transfer, shall be allocated to TNP). In the event that the method for the allocation of depreciation or amortization deductions attributable to contributed property described in the previous sentence is disallowed, then the Tax Matters Partner shall make such compensating allocations of items including (notwithstanding the second sentence of Section 4.3(a)) such book allocations as are intended to accomplish the same economic result.

               (ii) Tax Credits. Any tax credits shall be allocated among the Partners in accordance with Regulation section 1.704-1(b)(4)(ii), unless the applicable Code provision shall otherwise require.

          (c) Conformity of Reporting. The Partners are aware of the income tax consequences of the allocations made or to be made pursuant to this Article 4 and Section 6.5 and hereby agree to be bound by the provisions of this Article 4 and Section 6.5 in reporting their shares of Partnership profits, gains, income, losses, deductions, credits and other items for income tax purposes.

ARTICLE V
DISTRIBUTIONS

     5.1 Distributions.

          (a) The Management Committee (or, at the Management Committee’s direction, the Executive Officers of the Partnership), on or before the last day of each month shall (i) determine the amount (x) of earnings (before depreciation and amortization) or other Partnership funds available for distribution to Partners (whether as a distribution of earnings or as loans or advances) and (y) the amount of working capital needed for the continuing operations of the business of the Partnership (including, without limitation, Capital Expenditures), and (ii) cause the excess, if any, of (x) over (y) to be distributed to the Partners (subject to the provisions of Sections 3.1(b) and 3.1(c) hereof relating to the Partnership’s retention of sums otherwise distributable to a Partner to discharge the obligation to make certain capital contributions and to pay

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certain accrued but unpaid interest). Except as otherwise provided herein, all distributions shall be made in proportion to the Partners’ Percentage Interests. For the purposes of this Section 5.1(a), any payment of principal or interest by the Partnership with respect to Indebtedness shall be treated as distributed by the Partnership to the Partner that transferred the property to the Partnership to which such Indebtedness relates, and then as contributed to the Partnership by such Partner as an Additional Capital Contribution.

          (b) If a distribution of cash is deemed made pursuant to Section 3.1(b), Section 3.1(c) or the last sentence of Section 5.1(a) and, the distribution is not in proportion to the Partner’s Percentage Interest, then the Management Committee shall adjust subsequent distributions so that the cumulative distributions deemed made pursuant to Section 3.1(b), Section 3.1(c), the last sentence of Section 5.1(a) and this Section 5.1(b) are, in the aggregate, in proportion to the Partners’ Percentage Interests.

ARTICLE VI
ACCOUNTING AND REPORTS

     6.1 Books and Records.

          (a) The Partnership shall maintain or cause to be maintained at an office of the Partnership this Agreement and all amendments thereto and full and accurate books of the Partnership showing all receipts and expenditures, assets and liabilities, Profits and Losses, and all other books, records and information required by the Act as necessary for recording the Partnership’s business and affairs. The Partnership’s books and records shall be maintained in accordance with GAAP except to the extent otherwise provided hereunder for purposes of maintaining Capital Accounts in accordance with Article IV hereof and calculating the Profits or Losses charged or credited thereto. Such documents, books and records shall be maintained at such office or such designated successor office until the expiration of any applicable statues of limitations for bringing a claim in relation to such documents, books and records.

          (b) Each Partner shall have the right at reasonable times during usual business hours to inspect the facilities of the Partnership, to observe the Partnership’s operations and to examine, audit and make copies of the books of account and other books and records of the Partnership and other books and records relating to the reserves, assets, liabilities and expenses of the Partnership and expenditures by the Management Committee on behalf of the Partnership; provided, however, that none of the foregoing activities shall be conducted in a manner that unreasonably interferes with the Partnership’s operations or business or the Management Committee’ management thereof. Such right may be exercised through any agent or employee of a Partner designated in writing by it or by an independent public accountant, engineer, attorney or other consultant so designated. The Partner making the request shall bear all expenses incurred in any inspection, audit or examination made at such Partner’s behest. Should any inspection, audit or examination disclose any errors or improper charges, the Management Committee shall make, or cause to be made, appropriate adjustments therefor.

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     6.2 Reports to Partners.

          (a) As soon as practicable and in any event within thirty (30) days after the end of each calendar month, the Tax Matters Partner shall cause to be prepared and sent to each Partner unaudited statements of income, cash flow and changes in retained earnings and Partners’ equity, for the month in question and from the beginning of such Fiscal Year to the end of such month and an unaudited balance sheet as of the close of such month, all of which shall (i) be prepared in accordance with GAAP (except that certain footnotes may be omitted) and (ii) set forth in each case in comparative form the figures for the same monthly period for the previous fiscal year.

          (b) As soon as practicable and in any event within seventy-five (75) days after the end of each Fiscal Year, the Tax Matters Partner shall provide to each Partner audited statements of income, retained earnings, cash flow and Partner’s equity, for such Fiscal Year and a balance sheet as of the close of such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, prepared and certified as to the scope of its audit by the accounting firm of Ernst & Young or such other certified public accountants as may be selected by the Management Committee.

          (c) As requested, the Tax Matters Partner shall provide to each Partner such information as may be necessary for them to comply with applicable financial reporting requirements of any competent governmental authorities or agencies or stock exchange on which the securities of any such Partner are listed including, without limitation, the U.S. Securities and Exchange Commission and such information regarding the financial position, business, properties or affairs of the Partnership as a Partner may reasonably request.

          (d) The Partnership’s proposed annual operating budgets and capital plans will be submitted by the Chief Executive Officer to each of the Partners for their review and comment prior to submission to the Management Committee for its review and approval, at least 30 days prior to the beginning of the upcoming Fiscal Year to which such operating budget and capital plan relates.

          (e) Each Partner shall receive copies of any written management reports from the Chief Executive Officer on a timely basis. The Chief Executive Officer will deliver to all members of the Management Committee weekly flash/reports in the same form as MNG requires the publishers or its newspapers to submit weekly to MNG’s CEO.

     6.3 Annual Tax Returns.

          (a) West Coast MediaNews is hereby designated the “Tax Matters Partner” for federal income tax purposes pursuant to Section 6231 of the Code with respect to all taxable years of the Partnership and is authorized to do whatever is necessary to qualify as such. If West Coast MediaNews is no longer a Partner or has resigned as the Tax Matters Partner, the Tax Matters Partner shall be any Partner designated as such by a unanimous vote of the Partners, and in the absence of a

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unanimous vote, as shall be determined under applicable provisions of the Code and/or Regulations. The Tax Matters Partner shall, as soon as practicable under the circumstances, inform each Partner of all tax-related matters that are, or have the reasonable potential to become, material to the Partnership that come to its attention in its capacity as Tax Matters Partner.

          (b) The Tax Matters Partner shall prepare or cause to be prepared all tax returns required of the Partnership, which returns shall be reviewed in advance of filing by Ernst & Young LLP or another certified public accountant selected by the Management Committee. As soon as practicable after the end of each Fiscal Year, the Tax Matters Partner shall furnish to each Partner such information in the possession of the Tax Matters Partner requested by such Partner as necessary to timely fulfill such Partner’s federal, state, local and foreign tax obligations, including Form K-1, or any similar form as may be required by the Code or the Internal Revenue Service (the “IRS”) or, to the extent any such information is not in the Tax Matters Partner’s possession, the Tax Matters Partner shall take all reasonable steps necessary to have such information provided to the requesting Partner. No later than forty-five (45) business days prior to filing with the IRS, the Tax Matters Partner shall deliver to each Partner for its review a complete copy of the federal income tax return proposed to be filed by the Partnership. The Tax Matters Partner shall consider in good faith, consistent with Section 6.3(c) hereof, any comments of the Partners with respect to such return made within thirty (30) business days of sending the copy of such return. The Partners shall file their individual or corporate returns in a manner consistent with the Partnership tax and information returns.

          (c) The Tax Matters Partner shall, consistent with the Business Plan, use its best efforts to do all acts and take whatever steps are required to maximize, in the aggregate, the federal, state and local income tax advantages available to the Partnership and shall defend all tax audits and litigation with respect thereto. The Tax Matters Partner shall maintain the books, records and tax returns of the Partnership in a manner consistent with the acts, elections and steps taken by the Partnership.

     6.4 Actions in Event of Audit. If an audit of any of the Partnership’s tax returns shall occur, each Partner shall, at the expense of the Partnership, participate in the audit. No Partner may contest, settle or otherwise compromise assertions of the auditing agent which may be adverse to the Partnership or any Partner without the approval of a unanimous Management Committee. The Management Committee may, if it determines that the retention of accountants or other professionals would be in the best interests of the Partnership, retain such accountants or other professionals, to assist in any such audits. The Partnership shall indemnify and reimburse the Management Committee for all expenses, including legal and accounting fees, claims, liabilities, losses, and damages to the extent borne by the Management Committee, incurred in connection with any administrative or judicial proceeding with respect to any audit of the Partnership’s tax returns. The payment of all such expenses to which this indemnification applies shall be made before any distributions are made to the Partners under Article V hereof. Neither the Tax Matters Partner, nor any other person shall have any obligation to provide funds for such purpose. The taking of any action and the incurring of any expense by the Management Committee in connection with any such

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proceeding, except to the extent required by law, is a matter in the sole discretion of the Management Committee.

     6.5 Tax Elections. The Tax Matters Partner shall, in its reasonable discretion, determine (x) whether or not to cause the Partnership to file an election under Code section 754 and the Regulations thereunder and a corresponding election under the applicable section of state and local law, (y) which method to apply to any asset of the Partnership under Section 704(c) of the Code consistent with Section 4.3(b) hereof and whether or not to make any other elections provided for under related state and local laws, and (z) any other tax elections.

ARTICLE VII
ACTIONS BY PARTNERS

     7.1 Consents and Other Actions by Sun, California Newspapers, MWSBC and MWCNI. In each instance under this Agreement when any consent, approval or other action is required or authorized to be taken by Sun, California Newspapers, MWSBC and/or MWCNI in their capacity as Partners, and in each instance hereunder when Sun, California Newspapers, MWSBC and/or MWCNI are entitled to the receipt of notice of any matter, it is hereby agreed by each of the parties hereto (a) that Sun shall act on behalf of Sun, California Newspapers, MWSBC and MWCNI, (b) that any consent, approval or other action made, given or taken by Sun shall be deemed to have been made, given and taken on behalf of Sun, California Newspapers, MWSBC and MWCNI and (c) that any notice duly delivered to Sun shall be deemed to have been duly delivered to Sun, California Newspapers, MWSBC and MWCNI, however notices shall also be sent to California Newspapers, MWSBC and MWCNI.

     7.2 Meetings. Meetings of the Partners shall be held at the place and time designated from time to time unanimously by the Partners. The Partners may take action by the vote of Partners at a meeting in person or by proxy, or without a meeting by written consent. In no instance where action is authorized by written consent need a meeting of Partners be called or noticed.

     7.3 Actions by the Partners. All actions required or permitted to be taken by the Partners with respect to the Partnership require the vote or consent of all of the Partners.

ARTICLE VIII
MANAGEMENT

     8.1 The Management Committee. The business and affairs of the Partnership shall be managed under the direction and authority of a Management Committee, who shall annually adopt a Business Plan.

          (a) Number, Appointment and Term of Managers. The Management Committee shall be comprised of seven members. Four members shall be appointed by West Coast MediaNews, two members shall be appointed by SCM and one member

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shall be appointed jointly by Sun, California Newspapers, MWSBC and MWCNI. The managers shall act solely as the agents of the Partners appointing them. Each manager shall serve at the pleasure of the Partner appointing him and until his successor has been duly appointed, or until his resignation or removal. In addition, the Chief Executive Officer of the Partnership, as named pursuant to Section 8.8(a), shall be entitled to attend all meetings and participate in all discussions of the Management Committee except as to matters regarding the Chief Executive Officer or as otherwise determined by the Management Committee. Each Partner shall also be entitled to designate one non-voting observer to attend and participate in all meetings of the Management Committee. Each Partner shall be invited, upon reasonable notice, to participate in any budget review meetings which are held by any Partner with the Chief Executive Officer or Chief Financial Officer.

          (b) Duties and Powers. The Management Committee may exercise all such powers of the Partnership and do all such lawful acts and things as are not directed or required to be exercised or done by the Partners. Each member of the Management Committee may delegate to a representative by written proxy the right to act on behalf of the member in any respect, including without limitation the right to attend meetings or telephone conferences, and to vote upon resolutions with or without a meeting.

          (c) Partner Consultation Rights. Each Partner shall be consulted by West Coast MediaNews (including its representatives on the Management Committee) with respect to (i) the recruitment, selection and hiring of a Chief Executive Officer, including consultation regarding his or her responsibilities, reporting structure, salary and benefits; and (ii) any changes in the reporting structure of the Chief Executive Officer, Chief Financial Officer or other Executive Officers, or any termination or hiring of any such individuals by the Partnership.

     8.2 Removal of Members; Vacancies. A member of the Management Committee may be removed at any time, with or without cause, by the Partner (or Partners) who appointed such member. Any vacancy on the Management Committee resulting from removal, resignation, death or incapacity shall be filled by the Partner (or Partners) who is entitled to appoint such member.

     8.3 Meetings of the Management Committee; Notice. The Management Committee shall meet in regular meetings held at least quarterly at such time and place as may from time to time be determined by the Management Committee either in person or by telephone. The Management Committee’s quarterly meetings will devote substantial time and attention to a review of the upcoming fiscal quarter and upcoming six months of projected operations of the Partnership, in addition to a review of results of operations for the prior fiscal quarter. Special meetings of the Management Committee may be called by any member. Written notice of regular and special meetings of the Management Committee, stating the place, date and hour of the meeting shall be delivered to each member together with a reasonably detailed agenda for such meeting not less than five Business Days before the date of the meeting, provided, that the foregoing notice requirement may be waived by the Management Committee with respect to any meeting at which at least four (4) members of the

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Management Committee (including at least one member appointed by each Partner) vote for waiver of notice. Notice may be delivered to members in person, by telephone, telecopy, fax, electronic mail or other means of telecommunication. The meetings of the Management Committee shall be convened by the chairman (if one has been elected) or in the absence or unavailability of the chairman, by the member who requested the meeting.

     8.4 Quorum. Four (4) members of the Management Committee shall constitute a quorum for the transaction of all such business as shall have been set forth with reasonable specificity in the agenda accompanying the notice for such meeting, either in person or by telephone provided that such four (or more) members who are in attendance at such meeting include members appointed by at least two Partners. For the transaction of all other business at a regular or special meeting of the Management Committee, four (4) members of the Management Committee, whether present in person or by telephone, shall again constitute a quorum, provided that such four (4) or more members who are in attendance include members appointed by each of the Partners.

     8.5 Voting. Any matter brought before the Management Committee shall be decided by a majority of members present, except for matters that require a unanimous vote of the Management Committee as provided in this Agreement or as otherwise provided under the laws of the State of Delaware.

     8.6 Certain Matters Requiring a Unanimous Vote of the Management Committee. The Partnership shall not, without a unanimous vote of all seven members of the Management Committee:

          (a) admit any new Partners to the Partnership or admit any new member to any Subsidiary;

          (b) sell, lease, transfer or otherwise dispose of (other than pro rata to the Partners) substantially all of the assets, property and goodwill of any newspaper or related publication owned by the Partnership or by any Subsidiary;

          (c) except for distributions to Partners pursuant to Section 5.1 which may be deemed to be advances, commit or cause the Partnership or any Subsidiary to invest in or purchase the securities of, or any interests of, any person except short-term investments in U.S. Government securities, federally-insured certificates of deposit, repurchase agreements for such securities, or commercial paper rated A-1 or better by Standard and Poor’s or P-1 or better by Moody’s or its equivalent by a nationally recognized statistical rating organization;

          (d) commit or cause the Partnership or any Subsidiary to acquire all or substantially all of the capital stock or all or substantially all of the assets of any person or business;

          (e) obligate the Partners to make any Additional Capital Contribution or adjust any Partner’s Percentage Interest;

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          (f) cause the Partnership or any Subsidiary to create, or enter into, any corporation, partnership, joint venture, association, trust or other business entity or to merge or consolidate with any person;

          (g) except as provided in Section 8.9 hereof, commit or cause the Partnership or any Subsidiary to enter into any contract, agreement, understanding or transaction (i) with any person, that is other than in the ordinary course of the Partnership’s business, (ii) with a Partner or an affiliate of any Partner, which would have the result of imposing terms or conditions on the Partnership or any Subsidiary that are more onerous or less advantageous to the Partnership or any Subsidiary than those customarily provided by such Affiliate to its affiliates or (iii) with a Partner or an Affiliate of any Partner that either involves goods, services or properties of a value of more than $1,000,000 in the aggregate over the entire term of such contract, agreement, understanding or transaction, or does not reflect standard and customary commercial terms;

          (h) accept the contribution of any additional newspapers or related assets from any Partner as an Additional Capital Contribution under the provision of Section 3.1(c) hereof;

          (i) commit or cause the Partnership or any Subsidiary (i) to borrow any funds; (ii) to enter into any capitalized leases, in each case in excess of an aggregate of $500,000 per year (on a combined basis), except for refinancings or extensions of any existing indebtedness of the Partnership or any Subsidiary (including, without limitation, the Indebtedness); (iii) to enter into any hedge agreement; or (iv) to guarantee the indebtedness of any other person or entity;

          (j) make any single Capital Expenditure in excess of $1.0 million or make Capital Expenditures in any Fiscal Year in excess of $2.5 million in the aggregate;

          (k) except as permitted pursuant to Article XI hereof, dissolve or liquidate the Partnership or any Subsidiary;

          (l) make any material change to the nature of the Partnership’s business as described in Section 2.3, or make any material change to the nature of the business of any Subsidiary as conducted on the Effective Date;

          (m) adopt any portion of the Business Plan which would, of itself, require a unanimous vote of the Management Committee; or

          (n) amend or waive any provision of the LLC Agreements of the Subsidiaries furnished by West Coast MediaNews to the other Partners prior to the Effective Date.

     8.7 Action by Consent. Any action required or permitted to be taken on behalf of the Partnership at any meeting of the Management Committee may be taken without a meeting by written consent signed by the number of members of the Management Committee required to approve such action, provided that such members include at least one member appointed by each of the Partners.

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     8.8 Executive Officers.

          (a) The Management Committee shall elect a chief executive officer of the Partnership (the “Chief Executive Officer”) who shall have the responsibility for managing the day-to-day business operations and affairs of the Partnership and supervising its other officers, subject to the direction, supervision and control of the Management Committee and the Partners. In general, the Chief Executive Officer shall have such other powers and perform such other duties as usually pertain to the office of a chief executive officer, and as from time to time may be assigned to him by the Management Committee, including, without limitation, the authority to retain and terminate employees of the Partnership. The Chief Executive Officer shall make himself or herself available to each of the Partners on a monthly basis to review the Partnership’s monthly financial operating results and projections of future performance. The powers and duties of the Chief Executive Officer shall at all times be subject to the provisions of this Agreement.

          (b) The Management Committee shall also elect a chief financial officer of the Partnership (the “Chief Financial Officer”) who shall have the responsibility for managing the Partnership’s financial affairs and books of account, subject to the direction of the Management Committee, the Chief Executive Officer, and the Partners. In general, the Chief Financial Officer shall have such other powers and perform such other duties as usually pertain to the office of a chief financial officer, and as from time to time may be assigned to him by the Management Committee. The powers and duties of the Chief Financial Officer shall at all times be subject to the provisions of this Agreement.

          (c) The Management Committee may in its discretion also elect from time to time such other Executive Officers as it may determine, each of whom shall have such powers and perform such duties as usually pertain to such offices and as from time to time may be assigned to such persons by the Management Committee. The powers and duties of each Executive Officer shall be subject to the provisions of this Agreement.

          (d) Both the Partnership’s Chief Executive Officer (other than with the approval of at least two of the Partners) and the Chief Financial Officer shall be employees of the Partnership and shall not simultaneously be employees of any Partner nor any Affiliate of any Partner.

          (e) Subject to the provisions of this Agreement and to the directives and policies of the Management Committee, the Chief Executive Officer, the Chief Financial Officer and the other officers of the Partnership shall have the power, acting individually or jointly, to represent and bind the Partnership in all matters, in accordance with the scope of their respective duties subject to Section 8.6 hereof and any other limitations imposed by the Management Committee.

     8.9 Provision of Services to Partnership by MediaNews. The Partners hereby agree that the Partnership shall obtain management services, operating, administrative, accounting, electronic media and/or other support services, newsprint purchase services, financial reporting services, human resource services, risk management

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services, tax reporting and tax return preparation services and other similar services which MediaNews Group, Inc., a Delaware corporation, and the parent company of West Coast MediaNews (“MediaNews”) provides to its own operating affiliates (collectively, the “MediaNews Support Services”) from MediaNews. In exchange for these services, the Partnership shall pay MediaNews, on a monthly basis, an amount equal to $5,400,000 per Fiscal Year commencing as of the Effective Date (the “Base Management Fee”). The Base Management Fee shall be subject to annual percentage increases or decreases, commencing with the Fiscal Year which begins on July 1, 2007, equal to any year-to-year changes in the Corporate Expenses of MNG; provided, however, that no annual percentage increase shall exceed (i) 5% in respect of a Fiscal Year in which the actual CNP EBITDA for such Fiscal Year exceeded the budgeted CNP EBITDA included in the initial Budget for such Fiscal Year approved by the Management Committee; or (ii) 3% in respect of any other Fiscal Year. The management fee payable to MediaNews under the Second Amended and Restated Partnership Agreement shall be prorated based on gross revenues generated by the Partnership through the Effective Date. The amount of the Base Management Fee and the adjustments set forth in this Section 8.9 may not be altered at any time without the unanimous vote of the Management Committee. All services and supplies including employee benefits and newsprint, shall be provided at cost without any adjustment for overhead or any other direct or indirect payment to MediaNews or its affiliates. MediaNews by agreeing to provide management services, agrees to perform those services with the degree of care that a reasonably prudent person would exercise and shall not enter into any transaction in which it may have a conflict of interest without the unanimous consent of the members of the Management Committee. If MediaNews should at anytime, due to bankruptcy, insolvency or similar incapacity, become unable to continue to provide such services on behalf of the Partnership, the Partners shall, by mutual agreement, make appropriate arrangements for the provisions of such services by one or more of the other Partners or their Affiliates, or by one or more third parties.

     8.10 MediaNews Change in Control.

          (a) West Coast MediaNews shall give prior written notice to Gannett and SCM of any proposed MediaNews Change in Control that either the stockholders or board of directors of MNG intend to accept (the “MNG Notice”), which notice shall specify the identity of the potential acquirer(s) and the structure of the proposed transaction. West Coast MediaNews shall promptly revoke any MNG Notice, upon written notice to Gannett and SCM, if the proposed transaction to which such MNG Notice relates is terminated for any reason.

          (b) Following receipt of any MNG Notice by Gannett, and during the Election Period, Gannett shall have the right (but not the obligation) to elect to transfer all of its Interest in the Partnership to TNP, without obtaining the consent of the Partnership or any other Partner, by sending the Gannett Notice in accordance with Section 13.2. Any such transfer to TNP shall become effective upon the closing date during the Election Period specified by Gannett in the Gannett Election Notice, and TNP shall be admitted as a substitute partner of the Partnership on such closing date; provided, however, that such transfer shall not become effective unless and until the

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consummation of the proposed MediaNews Change in Control referenced in the MNG Notice.

ARTICLE IX
TRANSFER OF PARTNERSHIP INTERESTS;
ADDITIONAL AND SUBSTITUTE PARTNERS

     9.1 Prohibited Transfers. No Partner may Transfer its Interest or any part thereof in any way whatsoever, and any such Transfer in violation of this Article IX shall be null and void as against the Partnership, except as otherwise permitted herein or provided by law, and the Transferring or withdrawing Partners shall be liable to the Partnership and the other Partners for all damages that they may sustain as a result of such attempted Transfer or withdrawal.

     9.2 Permitted Transfers by Partners. Except for a Permitted Transfer, no Partner may Transfer all or a portion of its Interest unless:

          (a) the Partner desiring to consummate such Transfer (the “Assigning Partner”), and the prospective Transferee each execute, acknowledge and deliver to all the other Partners such instruments of transfer and assignment with respect to such Transfer and such other instruments as are reasonably satisfactory in form and substance to all the Partners (including those written instruments described in 9.6(d));

          (b) the Transfer will not violate any federal or state laws;

          (c) the Transfer will not cause any violation of or an event of default under, or result in acceleration of any indebtedness under, any note, mortgage, loan, or similar instrument or document to which the Partnership is a party;

          (d) the Transfer will not cause a material adverse tax consequence to the Partnership or any of the Partners including but not limited to any material adverse tax consequence resulting, directly or indirectly, from the termination of the Partnership under section 708 of the Code;

          (e) the Transfer will not cause the Partnership to be classified as an entity other than a partnership for purposes of the Code; and

          (f) except for transfers of a Partner’s Interest to an Affiliate of such Partner, any amendments to this Agreement required by or made a condition by any Partner to its consent to the transfer, have been made.

     9.3 Substitute Partner. A Transferee of the whole or any part of an Interest who satisfies the conditions set forth in Section 9.2 hereof shall have the right to become a Partner in place of the Assigning Partner only if all of the following conditions are satisfied:

          (a) the fully executed and acknowledged written instrument of assignment that has been filed with the Partnership sets forth a statement of the intention of the Assigning Partner that the Transferee become a Substitute Partner in its place;

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          (b) the Transferee executes, adopts and acknowledges this Agreement (as it may be amended) and agrees to assume all the obligations of the Assigning Partner; and

          (c) any costs of the Transfer incurred by the Partnership shall have been reimbursed by the Assigning Partner or the Transferee to the Partnership.

     9.4 Involuntary Withdrawal by a Partner. With respect to the Transfer of a Partner’s Interest due to bankruptcy, or other insolvency, involuntary dissolution or liquidation, or foreclosure (or other exercise of remedies by a party holding a security interest in such Interest) (each, an “Involuntary Transfer”), the Partner with respect to whom such event occurred shall forthwith cease to be a Partner and shall have no rights or powers as a Partner except for such rights as are specified pursuant to Articles III, IV and V and Section 10.3(b) hereof.

     9.5 Right of First Refusal for Sale of Partnership Interests.

          (a) Except as otherwise herein provided, no Partner may voluntarily transfer all or any part of its Interest in the Partnership to any party unless it has complied with the procedures of Section 9.2 and first offers to sell such Interest to the other Partner(s) pursuant to the terms of this Section 9.5; provided that this Section 9.5 shall not be applicable with respect to a Transfer to an Affiliate of the Transferring Partner.

          (b) A Partner (the “Offering Partner”) who has received a firm, written, bona fide offer from a third-party for its Interest ( a “Third Party Offer”) or who has otherwise determined to offer its Interest for sale shall, before offering such Interest or agreeing to accept such offer for such Interest (in either case, the “Offered Interest”), give written notice to the other Partners that are not Affiliates of the Offering Partner (each an “Option Partner”) of such offer or intent including, in the case of a Third Party Offer, a copy of such Third Party Offer and a complete description thereof including, by way of example but not of limitation, the nature and extent of such Third Party Offer, the purchase price therein, the terms of payment and the time for performance.

          (c) Upon receiving the Offering Partner’s written notice pursuant to Section 9.5(b), the Option Partner(s) shall have a period of thirty (30) days following the date of receipt by the Option Partner of the Offering Partner’s notice to elect to purchase the Offered Interest at the price determined in accordance with Section 9.5(f). If an Option Partner desires to purchase the Offered Interest it shall give written notice to the Offering Partner in the manner set forth in Section 13.2 hereof within such 30-day period. To be effective, this notice must be received by the Offering Partner within such 30-day period. In no event may the Option Partner(s) elect to acquire less than all of the Offered Interest. To the extent there are more than one Option Partners, the Option Partners accepting such offer shall be jointly and severally liable to the Offering Partner to purchase all of the Offered Interest.

          (d) The closing of the sale and purchase of the Offered Interest shall be promptly completed, but in any event, to the extent practicable, within ninety (90) days after the receipt of the Option Partner(s)’ notice of acceptance (or such later date

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as necessary to obtain any necessary regulatory approvals). The Management Committee shall assist in coordinating the closing. At the closing, the Offering Partner shall sell the Offered Interest, free and clear of all liens and encumbrances, and execute and deliver such assignment(s) and all other documents or other instruments of assignment or conveyance necessary to effect and evidence the assignment. At the closing, the Option Partner(s) shall deliver to the Offering Partner cash, a certified or official bank check or shall pay by wire transfer of immediately available funds for the applicable purchase price.

          (e) If the Option Partner(s) do not elect to purchase all of the Offered Interest pursuant to this Section 9.5, then the Offering Partner shall be free to sell, assign, transfer, pledge, encumber or otherwise dispose of the Offered Interest pursuant to the Third Party Offer or, in the case of a non-Third Party Offer, to any third party for an amount equal to Fair Market Value of the Offered Interest, as hereunder determined, in either case, within six month’s after the date of the Option Partner(s)’ notice of refusal or after the expiration of the 30-day response period, whichever occurs first. For purposes of this Section 9.5(e), a sale shall be deemed made when there is executed a legally binding agreement between the Offering Partner and the prospective purchaser, subject to no condition or contingency which permits the prospective purchaser to terminate or cancel the agreement, except for the default of the Offering Partner, and routine approvals or conditions. If a sale within the meaning of this Section 9.5(e) is not made within such 6-month period, then the Offered Interest shall remain subject to the restrictions of this Agreement and must again be first offered to the Option Partner(s) if the Offering Partner thereafter wishes to sell its Interest to a third party.

          (f) (i) In the case of a Third Party Offer, if the consideration offered by the prospective purchaser is offered in cash and/or a promissory or other similar instrument to be issued by the prospective purchaser, the price shall be the price offered by such prospective purchaser. If (A) the consideration offered by the prospective purchaser is offered in a form other than cash and/or a promissory note or other similar instrument or (B) the Offering Partner has not received a Third Party Offer, then in either case, the price shall be the Fair Market Value of the Offered Interest, as defined below.

               (ii) For the purposes of this Agreement, “Fair Market Value of the Offered Interest” shall be the amount that would be paid for the Offered Interest in the Partnership as a going concern, on a consolidated basis, by a willing buyer to a willing seller. The Offering Partner and the Option Partner(s) may mutually agree as to the Fair Market Value of the Offered Interest in question. If the Offering Partner and the Option Partner(s) are unable to agree on the Fair Market Value of the Offered Interest within fifteen (15) days after the Offering Partner’s written notice of the proposed sale, then in such event Fair Market Value of the Offered Interest shall be determined pursuant to Section 9.5(f)(iii) by two independent qualified appraisers, one to be appointed by the Offering Partner and the other to be appointed by the Option Partner(s).

               (iii) The two independent appraisers shall be appointed within fifteen (15) days after receipt by the Option Partner(s) of the notice of proposed sale. If either side fails to appoint an appraiser within such period, then its right to do so shall

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lapse and the appraisal made by the one independent appraiser who is timely appointed shall be the Fair Market Value of the Offered Interest. If two appraisals are made, and if the two appraised values differ by less than 15 percent, Fair Market Value of the Offered Interest shall be the average of the two appraisals, and if the two appraised values differ by more than 15 percent, the two appraisers shall jointly select a third appraiser and, the Fair Market Value of the Offered Interest shall be the average of the two of the three appraisals that are closest together in amount. All appraisals shall be made within thirty (30) days of appointment of an appraiser, and written notice of the results of such appraisals shall be given to all parties within such 30-day period. The Fair Market Value of the Offered Interest shall be determined based upon the value of the Partnership in its entirety as a going concern, with the Offering Partner receiving a proportionate part of such total value based upon its Percentage Interest. In making any appraisal hereunder, all debts and liabilities shall be taken into account. Each side shall pay the fees of the appraiser selected by them.

     9.6 Tag-Along Rights Regarding Sales of Partnership Interests.

          (a) Except for Transfers of a Partner’s Interest to an Affiliate of such Partner and except following an Involuntary Transfer of a Partner’s Interest, in any case where a Partner has declined to exercise its rights of first refusal under Section 9.5, no Partner (the “Tag-Along Offeror”) shall, individually or collectively, in any one transaction or series of transactions, directly or indirectly, sell or otherwise dispose of its Interest, to any person (a “Third Party”) unless the terms and conditions of such sale or other disposition to such Third Party shall include an offer to each other Partner (each, a “Tag-Along Offeree”) to include, at the option of each Tag-Along Offeree, in the sale or other disposition to the Third Party, such Tag-Along Offeree’s Interest (the “Tag-Along Right”). Each Partner proposing to effect such a sale or other disposition shall send a written notice (the “Tag-Along Notice”) to each of the Tag-Along Offerees setting forth the terms of the offer. At any time within 15 days after its receipt of the Tag-Along Notice, each Tag-Along Offeree may exercise its Tag-Along Option by furnishing written notice of such exercise (the “Tag-Along Exercise Notice”) to the Tag-Along Offeror.

          (b) If the proposed sale or other disposition to the Third Party by the Partner providing the Tag-Along Notice is consummated, each Tag-Along Offeree shall have the right to sell such Third Party all of its Interest.

          (c) Each Partner participating in the sale or other disposition to the Third Party shall have the right, in their sole discretion, at all times prior to consummation of the proposed sale or other disposition giving rise to the Tag-Along Right granted by this Section to abandon, rescind, annul, withdraw or otherwise terminate such sale or other disposition as it relates to such Partner’s Interest whereupon that Partner’s Tag-Along Rights in respect of such sale or other disposition pursuant to this Section shall become null and void, and neither the Tag-Along Offeror nor the Third Party shall have any liability or obligations to the withdrawing Tag-Along Offeree with respect thereto by virtue of such abandonment, rescission, annulment, withdrawal or termination.

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          (d) The purchase of each Tag-Along Offeree’s Interest pursuant to this Section shall be on the same terms and conditions, including but not limited to the purchase price (as adjusted for any difference in size of the respective Interest’s), as are applicable to the Partner giving the Tag-Along Notice, which shall be stated in such Tag-Along Notice. In determining the purchase price of any Interest under this Section, the aggregate purchase price of all Interests being acquired by the Third Party shall be increased to the extent any of the selling Partners shall receive additional compensation (A) for covenants not to compete or (B) for services (such as pursuant to consulting agreements or management agreements) which are in excess of the amounts which would be payable for comparable services as a result of an arm’s-length transaction.

          (e) If, within 15 days after receipt of a Tag-Along Notice, any Tag-Along Offeree has not delivered a Tag-Along Exercise Notice, such Tag-Along Offeree will be deemed to have waived any and all of its rights with respect to the sale or other disposition of Interests described in such Tag-Along Notice and the other Partners shall have 135 days following the expiration of such 15-day period in which to consummate such sale or other disposition on terms not more favorable to such other Partners than those described in the Tag-Along Notice. If, at the end of 150 days following receipt of such Tag-Along Notice, the sale or other disposition described therein has not been completed, then all restrictions on sale or other disposition contained in this Agreement shall again be in effect.

     9.7 West Coast MediaNews Drag-Along Rights.

          (a) If, at any time after January 1, 2005, West Coast MediaNews receives a bona fide written offer to purchase all of the Interests in the Partnership from an independent third party, in one transaction or a series of transactions, and West Coast MediaNews determines to accept such offer, then, notwithstanding any other provisions of this Agreement, at West Coast MediaNews’s election, all other Partners shall, subject to (b) below, be required to sell their respective Interests on the same terms and conditions (except for adjustments based upon the relative size of Percentage Interests) as have been offered to West Coast MediaNews (the West Coast MediaNews Drag-Along Rights); provided that the aggregate purchase price of all Interests being acquired by the Third Party shall be increased to the extent any of the selling Partners shall receive additional compensation (A) for covenants not to compete or (B) for services (such as pursuant to consulting agreements or management agreements) which are in excess of the amounts which would be payable for comparable services as a result of an arm’s-length transaction; and further provided that all other Partners receive fair market value (as determined in accordance with Section 9.5(f)) for their Interest.

          (b) If West Coast MediaNews elects to exercise its Drag-Along Rights, it shall provide written notice (the “Drag-Along Notice”) to each other Partner of such election at least 30 days in advance of the closing date for such transaction, which notice shall describe the terms and conditions of such offer and the proposed closing date. Upon receipt of the Drag-Along Notice, each other Partner shall be obligated to sell its entire Interest to the Third Party making such offer on the terms set forth in the Drag-Along Notice. However, if the transaction is not completed within 90 days after the

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giving of the Drag-Along Notice, then any sale thereafter by West Coast MediaNews of its Interest with respect to which it wishes to exercise its Drag-Along Rights shall require a new notice under this Section 9.7(b).

     9.8 Admission of Additional Partners. A person shall become an Additional Partner only if and when each of the following conditions is satisfied:

          (a) the Management Committee, unanimously and in its sole and absolute discretion, determine the Additional Contribution Terms;

          (b) the Partnership has complied with the terms of Section 3.1(b);

          (c) all of the Partners consent in writing to such admission, which consent may be withheld by any such Partner in its sole and absolute discretion;

          (d) the Management Committee receives written instruments (including, without limitation, such person’s consent to be bound by this Agreement (as it may be amended) as an Additional Partner) that are in a form satisfactory to the Management Committee (as determined in its sole and absolute discretion);

          (e) the Partnership has received such person’s Capital Contribution; and,

          (f) any amendments to this Agreement required by or made a condition by any Partner to its consent to the transfer, have been made.

     9.9 SCM Put Option.

          (a) At any time on or after January 1, 2005, SCM may, by written notice to West Coast MediaNews and Gannett, require West Coast MediaNews and Gannett to cause the Partnership to enter into a contract to redeem all of SCM’s Interest in the Partnership in exchange for a distribution of cash equal to the then-determined fair market value of such Interest (net of any liabilities allocable to such Interest) plus the amounts described in Section 9.9(b) below within 2 years of the date the fair market value of such Interest is determined under this Section 9.9. Such fair market value shall be determined in accordance with the procedures set forth in Section 9.5(a) through (f) above, provided, however, that the period for negotiation between the Partners set forth in Section 9.5(f)(ii) shall be 90 days. At the time such fair market value is determined, the Interest of SCM in the Partnership shall terminate and SCM shall be treated as a “retiring partner” for purposes of Code Section 736 and the payment described in this Section 9.9(a) shall be treated as described in Code Section 736(b).

          (b) Upon the date of the determination of such fair market value, SCM’s right to receive any distribution or allocation of Profits from the Partnership under Section 4.2(b) shall convert automatically into a first priority interest in the Profits of the Partnership equal to the product of (x) the determined fair market value of such Interest and (y) the 30-day London Inter-Bank Offered Rate (“LIBOR”) plus (I) 1 percent for the first 6-month period following the date of determination of the fair market value; (II) 2 percent for the seventh through ninth months following the date of determination of the fair market value; (III) 3 percent for the tenth through twelfth months following the date of determination of the fair market value; (IV) 4 percent for the thirteenth through

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fifteenth months following the date of determination of the fair market value; (V) 5 percent for the sixteenth through eighteenth months following the date of determination of the fair market value; (VI) 6 percent for the nineteenth through twenty-first months following the date of determination of the fair market value; and (VII) 7 percent for the twenty-second through twenty-fourth months following the date of determination of the fair market value. The payments described in this Section 9.9(b) shall be treated as distributions of partnership income as described in Code Section 736(a).

          (c) In connection with SCM’s exercise of the put option described in subsection (a) above, each of the other Partners shall be obligated, effective as of the closing for the Partnership’s acquisition of SCM’s Interest in the Partnership, to make as an additional capital contribution their pro rata share of such additional cash sums as may be required by the Partnership to acquire SCM’s Interest in the Partnership under the terms of this Section 9.9. Notwithstanding the foregoing, however, (i) if West Coast MediaNews shall advise Gannett, in its sole discretion, of its election, with Gannett’s concurrence, to contribute less than its pro rata share of such required additional capital contributions, then Gannett shall, at its option, be permitted to contribute the portion of such funds which West Coast MediaNews elects not to contribute and (ii) if at the time SCM exercises its put Gannett’s Percentage Interest is less than 20%, Gannett shall, in its sole election, in any event be permitted to contribute so much of the additional cash sums required for the Partnership to acquire SCM’s interest as shall appropriately cause Gannett’s Percentage Interest (after the making of both Gannett’s and West Coast MediaNews’ capital contribution) to be increased to 20%. Immediately following the making of the additional capital contributions required for the Partnership to acquire SCM’s interest, Gannett’s and West Coast MediaNews’ Percentage Interests shall be appropriately re-adjusted.

     9.10 Reserved.

     9.11 Partnership Call Option Re Section 9.9 Put Option.

          (a) At any time subsequent to the exercise by SCM of its put option set forth in Section 9.9 of this Agreement, the Partnership shall have the option, by written notice to Gannett, to redeem all of Gannett’s Interest in the Partnership, if at the time of such notice the Percentage Interest of Gannett shall be less than 20%.

          (b) Upon the exercise by the Partnership of its option set forth in subsection (a) hereof, the Partnership shall undertake to redeem all of Gannett’s interest in the Partnership, in exchange for a distribution of cash equal to the then-determined fair market value of such Interest (net of any liabilities allocable to such Interest) plus the amounts described in Section 9.11(c) below within 2 years of the date the fair market value of such Interest is determined under this Section 9.11. Such fair market value shall be determined in accordance with the procedures set forth in Section 9.5(a) through (f) above, provided, however, that the period for negotiation between the Partners set forth in Section 9.5(f)(ii) shall be 90 days. At the time such fair market value is determined, the Interest of Gannett in the Partnership shall terminate and Gannett shall be treated as a “retiring partner” for purposes of Code Section 736 and

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the payment described in this Section 9.11(b) shall be treated as described in Code Section 736(b).

          (c) Upon the date of the determination of such fair market value, Gannett’s right to receive any distribution or allocation of Profits from the Partnership under Section 4.2(b) shall convert automatically into a first priority interest in the Profits of the Partnership equal to the product of (x) the determined fair market value of such Interest and (y) LIBOR plus (I) 1 percent for the first 6-month period following the date of determination of the fair market value; (II) 2 percent for the seventh through ninth months following the date of determination of the fair market value; (III) 3 percent for the tenth through twelfth months following the date of determination of the fair market value; (IV) 4 percent for the thirteenth through fifteenth months following the date of determination of the fair market value; (V) 5 percent for the sixteenth through eighteenth months following the date of determination of the fair market value; (VI) 6 percent for the nineteenth through twenty-first months following the date of determination of the fair market value; and (VII) 7 percent for the twenty-second through twenty-fourth months following the date of determination of the fair market value. The payments described in this Section 9.11(c) shall be treated as distributions of partnership income as described in Code Section 736(a).

     9.12 Acknowledgment of Pledges of Interests.

          (a) SCM and Gannett hereby each acknowledges that West Coast MediaNews’s Interest in the Partnership has been pledged as security under an Amended and Restated Credit Agreement dated as of December 30, 2003, as currently amended, among MediaNews Group, Inc., Bank of America, N.A., and other banks, as amended, substituted, refinanced, renewed or replaced (without regard to the amount of credit extended thereunder or the identity of the lenders or agents with respect thereto). Each Partner hereby agrees that any foreclosure on such pledge shall not be deemed a Transfer for purposes of Sections 9.3, 9.5, 9.6 and 9.7 (but shall be deemed as Involuntary Transfer pursuant to Section 9.4).

          (b) West Coast MediaNews and Gannett each hereby acknowledges that SCM has pledged its Interest in the Partnership under the following agreement: (i) the Loan Agreement among SCM, U.S. Banks National Association, Wachovia Bank, National Association, and Wachovia Capital Markets, LLC dated August 2, 2006, as may be amended, substituted, refinanced, renewed or replaced (without regard to the amount of credit extended thereunder or the identity of the lenders or agents with respect thereto). Each Partner hereby agrees that any foreclosure on such pledge shall not be deemed a Transfer for purposes of Sections 9.3, 9.5, 9.6 and 9.7 (but shall be deemed as Involuntary Transfer pursuant to Section 9.4).

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ARTICLE X
DISSOLUTION AND LIQUIDATION

10.1 Dissolution.

          (a) The Partnership shall be dissolved upon the first to occur (each a “Dissolution Event”):

               (i) December 31, 2048;

               (ii) At any time after January 1, 2004, the election by written notice to the other Partners by one or more Partners (the “Electing Partner”) to terminate the Partnership prior to December 31, 2048; provided, however, that such right may be exercised at any time in connection with an Involuntary Transfer of a Partner’s Interest or to the extent required to effect compliance with the provisions of any indenture applicable to publicly held indebtedness of a Partner; or,

               (iii) The occurrence of any other event specified under the Delaware Uniform Partnership Law (6 Del. C. §15-801 et seq.) as one effecting such dissolution.

          (b) Notwithstanding the provisions of subsection (a)(ii) above, a dissolution of the Partnership shall not occur if, within 10 business days of receipt of the written notice described in subsection (a)(ii) above, the Partners other than the Partner who is the Electing Partner provide written notice to the Electing Partner of their election to continue the business of the Partnership and of their undertaking to cause the Partnership to enter into a contract to redeem all of the Interest in the Partnership of the Partner electing to terminate the Partnership, in exchange for a distribution of cash equal to the then-determined fair market value of such Interest (net of any liabilities allocable to such Interest) plus the amounts described in the second to last sentence of this subsection within 2 years of the date the fair market value of such Interest is determined under this Section 10.1(b). Such fair market value shall be determined in accordance with the procedures set forth in Section 9.5(a) through (f) above, provided, however, that the period for negotiation between the Partners set forth in Section 9.5(f)(ii) shall be 90 days. At the time such fair market value is determined, the Interest of the Electing Partner in the Partnership shall terminate and Electing Partner shall be treated as a “retiring partner” for purposes of Code Section 736 and the payment described in this Section 10.1(a) shall be treated as described in Code Section 736(b).

          (c) Upon the date of the determination of such fair market value, the Electing Partner’s right to receive any distribution or allocation of Profits from the Partnership under Section 4.2(b) shall convert automatically into a first priority interest in the Profits of the Partnership equal to the product of (x) the determined fair market value of such Interest and (y) LIBOR plus (I) 1 percent for the first 6-month period following the date of determination of the fair market value; (II) 2 percent for the seventh through ninth months following the date of determination of the fair market value; (III) 3 percent for the tenth through twelfth months following the date of determination of the fair market value; (IV) 4 percent for the thirteenth through fifteenth months following the date of determination of the fair market value; (V) 5 percent for the sixteenth through eighteenth months following the date of determination of the fair market value; (VI) 6 percent for the nineteenth through twenty-first months following the date of determination of the fair market value; and (VII) 7 percent for the twenty-second through

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twenty-fourth months following the date of determination of the fair market value. The payments described in this Section 10.1(c) shall be treated as distributions of partnership income as described in Code Section 736(a).

     10.2 Election to Continue the Business. The Partnership shall also not be dissolved pursuant to a Dissolution Event specified in Sections 10.1(a)(i) or (iii) (except as otherwise provided in the Act), if, within 20 business days of such Dissolution Event, all the remaining Partners unanimously agree in writing to continue the business of the Partnership.

     10.3 Closing of Affairs.

          (a) In the event of the dissolution of the Partnership for any reason, and in the absence of an election pursuant to Section 10.2 hereof to continue the business of the Partnership, the Management Committee shall commence to close the affairs of the Partnership, to liquidate or retain for distribution to the Partners its investments and to terminate the Partnership, in each instance in such manner as the Management Committee may reasonably determine to be appropriate, provided, however, that no distribution of any Partnership property shall be made to any of the Partners (except for pro rata distributions) except upon the prior approval of all of the Partners. Upon complete liquidation of the Partnership’s property and compliance with the distribution provisions set forth in Section 10.3(b) hereof, the Partnership shall cease to be such, and the Management Committee shall cause to be executed, acknowledged and filed all certificates necessary to terminate the Partnership.

          (b) In liquidating the Partnership, the assets of the Partnership shall be applied to the extent permitted by the Act in the following order of priority:

               (i) First, to pay the costs and expenses of the closing of the affairs and liquidation of the Partnership;

               (ii) Second, to pay the matured debts and liabilities of the Partnership;

               (iii) Third, to establish reserves adequate to meet any and all contingent or unforeseen liabilities or obligations of the Partnership, provided that at the expiration of such period of time as the Management Committee may deem advisable, the balance of such reserves remaining after the payment of such contingencies or liabilities shall be distributed as hereinafter provided;

               (iv) Fourth, to all Partners in proportion to each Partner’s Percentage Interest in the Partnership, after taking appropriate account of, and making appropriate adjustments for, (A) any Indebtedness then remaining outstanding which is attributable to any Partnership assets previously contributed by a particular partner, and (B) any portion of any required capital contributions or accrued but unpaid interest described in either Section 3.1(b) or 3.1(c) of this Agreement which then remains outstanding, (provided, however, that to the extent that any Partner has a finally adjudicated indemnity obligation to any other Partner, any distribution that would otherwise be distributed to the Partner subject to such obligation shall be distributed to the Partner(s) entitled to the benefit of the indemnity obligation to the extent thereof).

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          (c) No Partner shall have any obligation to restore a deficit balance in its Capital Account.

ARTICLE XI
AMENDMENT TO AGREEMENT

     Amendments to this Agreement and to the Certificate of Formation of the Partnership shall be approved in writing by all of the Partners. An amendment shall become effective as of the date specified in the Partners’ approval or if none is specified as of the date of such approval or as otherwise provided in the Act.

ARTICLE XII
INDEMNIFICATION

     12.1 General. From and after the Closing, the Partners shall indemnify each other as provided in this Article XII. As used in this Agreement, the term “Damages” shall mean all liabilities, demands, claims, actions or causes of action, regulatory, legislative or judicial proceedings or investigations, assessments, levies, losses (including, without limitation, any adverse tax consequences to other parties arising directly or indirectly from a violation of a covenant in this Agreement by a party), fines, penalties, damages, costs and expenses, including, without limitation: reasonable attorneys’, accountants’, investigators’, and experts’ fees and expenses sustained or incurred in connection with the defense or investigation of any such claim.

     12.2 Indemnification Obligations. Notwithstanding any other provision of this Agreement, each party (an “Indemnifying Party”) shall defend, indemnify, save and keep harmless the other Partners, the Partnership and their respective successors and permitted assigns (collectively, the “Indemnified Parties”) against and from any and all Damages sustained or incurred by any of them resulting from or arising out of or by virtue of:

          (a) any breach of any representation or warranty made by the Indemnifying Party in this Agreement or in any closing document delivered to the Indemnified Parties in connection with this Agreement;

          (b) any breach by the Indemnifying Party of, or failure by the Indemnifying Party to comply with, any of its covenants or obligations under this Agreement (including, without limitation, their obligations under this Article XII); or,

          (c) any indemnification obligation of such party or any affiliate thereof arising under the provisions of Article XI of the Contribution Agreement.

     In no event, however, shall any party be liable to indemnify the other parties with respect to any breach of which such other Partner(s) had actual knowledge prior to the Closing.

     Any indemnification obligation arising under this Article XII and/or Article X of the Contribution Agreement shall be discharged by a capital contribution by the Partner owing such obligation to the Partnership in the amount of the Damages relating thereto.

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Any payment by the Partnership of Damages to which an indemnification obligation relates shall be charged as a distribution to the Indemnifying Partner and taken into account for purposes of current and future distributions made by the Partnership pursuant to Section 5.1. In addition, no item of Partnership property shall be revalued to reflect such indemnification payment. From the date of determination of such obligation (which shall be the date agreed by the parties or the date of a final binding determination by a mediator or the date of a final, non-appealable determination by a court of competent jurisdiction, as applicable) and until such obligation (and all accrued interest, if any, with respect thereto) has been paid in full in cash or other immediately available funds, all cash distributions to which a Partner shall otherwise be entitled to receive pursuant to Section 5.1(a) hereof, shall instead be retained by the Partnership and credited to the discharge of the obligation to make such capital contribution and to pay accrued but unpaid interest as provided in Section 3.1(c) hereof.

     12.3 Exclusive Remedy. The sole and exclusive remedy of Indemnified Parties with respect to any and all claims relating to the subject matter of this Agreement shall be pursuant to the indemnification provisions set forth in this Article XII.

     12.4 Third Party Claims. Promptly following the receipt of notice of any claim for Damages or for equitable relief which are asserted or threatened by a party other than the parties hereto, their successors or permitted assigns (a “Third Party Claim”), the party receiving the notice of the Third Party Claim shall (a) notify the other Partners in writing in accordance with Section 13.2 hereof of its existence setting forth with reasonable specificity the facts and circumstances of which such party has received notice and (b) if the party giving such notice is an Indemnified Party, specifying the basis hereunder upon which the Indemnified Party’s claim for indemnification is asserted. No failure to give notice of a claim shall affect the indemnification obligations of the Indemnifying Party hereunder, except to the extent that the Indemnifying Party can demonstrate that such failure materially prejudiced such Indemnifying Party’s ability to successfully defend the matter giving rise to the claim. The Indemnified Party shall tender the defense of a Third Party Claim to the Indemnifying Party.

     The Indemnified Party shall not have the right to defend or settle such Third Party Claim. The Indemnified Party shall have the right to be represented by counsel at its own expense in any such contest, defense, litigation or settlement conducted by the Indemnifying Party. The Indemnifying Party shall lose its right to defend and settle the Third Party Claim if it shall fail to diligently contest the Third Party Claim. So long as the Indemnifying Party has not lost its right and/or obligation to defend and settle as herein provided, the Indemnifying Party shall have the right to contest, defend and litigate the Third Party Claim and shall have the right, in its discretion exercised in good faith, and upon the advice of counsel, to settle any such matter, either before or after the initiation of litigation, at such time and upon such terms as it deems fair and reasonable; provided that in any event the Indemnifying Party shall consult with the Indemnified Party with respect to settling such matter which decision shall be made by mutual agreement of the Indemnifying Party and the Indemnified Party, not to be unreasonably withheld by either. All expenses (including without limitation attorneys’ fees) incurred by the Indemnifying Party in connection with the foregoing shall be paid by the Indemnifying

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Party. Notwithstanding the foregoing, in connection with any settlement negotiated by an Indemnifying Party, no Indemnified Party shall be required by an Indemnifying Party to (w) enter into any settlement that does not include as an unconditional term thereof the delivery by the claimant or plaintiff to the Indemnified Party of a release from all liability in respect of such claim or litigation, (x) enter into any settlement that attributes by its terms liability to the Indemnified Party, (y) consent to the entry of any judgment that does not include as a term thereof a full dismissal of the litigation or proceeding with prejudice or (z) enter into any settlement which would, or could reasonably be expected to, result in or relate to either a material nonmonetary obligation or restriction of any kind whatsoever being imposed upon the Indemnified Party or Damages other than Damages which are indemnifiable under this Article XII; provided, however, that the Indemnifying Party may enter into the settlements described in (w) and (y) above if (1) such settlement is not in any way materially damaging or harmful to the Partnership’s business or the Indemnified Parties, as the case may be, and (2) the Indemnifying Party agrees to remain liable to the Indemnified Party for indemnification with respect to such claim indefinitely thereafter. No failure by an Indemnifying Party to acknowledge in writing its indemnification obligations under this Article XII shall relieve it of such obligations to the extent they exist. If an Indemnified Party is entitled to indemnification against a Third Party Claim, and the Indemnifying Party fails to accept the defense of a Third Party Claim tendered pursuant to this Section 12.4, or if, in accordance with the foregoing, the Indemnifying Party shall lose its right to contest, defend, litigate and settle such a Third Party Claim; provided that the Indemnifying Party shall be entitled to participate, at its expense, with counsel of its choice, and any settlement shall be approved by the Indemnifying Party, such approval not to be unreasonably withheld, the Indemnified Party shall have the right, without prejudice to its right of indemnification hereunder, in its discretion exercised in good faith and upon the advice of counsel, to contest, defend and litigate such Third Party Claim, and subject to the preceding sentence may settle such Third Party Claim, either before or after the initiation of litigation. If, pursuant to this Section 12.4, the Indemnified Party so defends or (except as hereinafter provided) settles a Third Party Claim, for which it is entitled to indemnification hereunder, as hereinabove provided, the Indemnified Party shall be reimbursed by the Indemnifying Party for the reasonable attorneys’ fees and other expenses of defending the Third Party Claim which is incurred from time to time, forthwith following the presentation to the Indemnifying Party of itemized bills for said attorneys’ fees and other expenses.

     12.5 Other Indemnification Claims. The Indemnified Party shall give the Indemnifying Party prompt notice of any Indemnification Claim (other than a Third Party Claim) specifying the basis hereunder upon which the Indemnified Party’s claim for indemnification is asserted. No failure to give notice of a claim shall affect the indemnification obligations of the Indemnifying Party hereunder, except to the extent that the Indemnifying Party can demonstrate that such failure materially prejudiced such Indemnifying Party’s ability to successfully defend or otherwise respond to the matter giving rise to the claim. In respect of any Indemnification Claim other than a Third Party Claim, the Partnership shall provide the Indemnifying Party with the opportunity and all appropriate access to the applicable facilities, personnel, books and records to conduct

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(under the Indemnifying Party’s control) necessary to respond to such Indemnification Claim.

ARTICLE XIII
GENERAL PROVISIONS

     13.1 Mediation. Each Partner agrees that, in the event of any dispute among such Partners regarding the interpretation or application of this Agreement (including any dispute regarding the operation of the Partnership that cannot be resolved by the procedures created by the provisions of this Agreement), it will follow the following procedures:

          (a) it will give each other Partner written notice of the matter in dispute;

          (b) it will negotiate reasonably and in good faith with the other Partners in order to resolve such dispute for a period of not less than fifteen (15) business days following receipt of the notice in (a);

          (c) if the dispute has not been resolved by negotiation pursuant to (b), it will cooperate with the other Partners to submit the dispute to an independent mediator (to be selected by the unanimous consent of the Partners, which shall only be withheld on the basis of good faith concerns about the independence or adequacy of expertise of the proposed mediator) who shall have ten (10) business days after the matter is fully submitted to him or her to propose a settlement of the dispute;

          (d) if any Partner refuses, in its sole and unreviewable discretion to accept the proposed resolution of the mediator, it shall give prompt written notice of such refusal to the other Partners and, at any time following receipt of any such notice, any Partner shall be free to pursue any legal, equitable or other remedies available to it regarding the matter in dispute.

     Notwithstanding the foregoing, no Partner shall be required to pursue the notice, negotiation or mediation steps set forth above if it determines, reasonably and in good faith, the delay involved in such procedure would cause irreparable, material harm to it or its interest in the Partnership.

     13.2 Notices. Unless otherwise specifically provided in this Agreement, all notices and other communications required or permitted to be given hereunder shall be in writing, directed or addressed to the respective addresses set forth in Section 2.8, and shall be either (i) delivered by hand, (ii) delivered by a nationally recognized commercial overnight delivery service, (iii) mailed postage prepaid by registered or certified mail, or (iv) transmitted by facsimile, with receipt confirmed. Such notices shall be effective: (a) in the case of hand deliveries when received; (b) in the case of an overnight delivery service, when received in accordance with the records of such delivery service; (c) in the case of registered or certified mail, upon the date received by the addressee as determined by the U.S. Postal Service; and (d) in the case of facsimile notices, when electronic indication of receipt is received. Any party may change its address and telecopy number by written notice to the other parties given in accordance with this Section 13.2.

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     13.3 Confidentiality. Each of the Partners agrees that, except as required by law, legal process, government regulators, or as reasonably necessary for performance of its obligations or enforcement of its rights under this Agreement, without the prior written consent of the other Partners, it will treat and hold as confidential (and not disclose or provide access to any person other than such Partner’s attorneys or accountants) and it will cause its Affiliates, officers, managers, partners, employees and agents to treat and hold as confidential (and not divulge or provide access to any person) all information relating to (i) the business of the Partnership and (ii) any patents, inventions, designs, know-how, trade secrets or other intellectual property relating to the Partnership, in each case excluding (A) information in the public domain when received by such Partner or thereafter in the public domain through sources other than such Partner, (B) information lawfully received by such Partner from a third party not subject to a confidentiality obligation and (C) information developed independently by such Partner. The obligations of the Partners hereunder shall not apply to the extent that the disclosure of information otherwise determined to be confidential is required by applicable law, provided, however, that prior to disclosing such confidential information to any party other than a governmental agency exercising its ordinary regulatory oversight of a Partner, a Partner shall notify the Partnership thereof, which notice shall include the basis upon which such Partner believes the information is required to be disclosed. This Section 13.3 shall survive for a period of four years with respect to any Partner that withdraws from the Partnership and, with respect to any dissolution or termination of the Partnership pursuant to Article X hereof, for a period of time agreed by the all of Partners.

     13.4 Entire Agreement, Etc. This Agreement, together with the Contribution Agreement, constitutes the entire agreement among all of the parties hereto relating to the subject matter hereof and supersedes all prior contracts, agreements and understandings among all of them. No course of prior dealings among all of the parties shall be relevant to supplement or explain any term used in the Agreement. Acceptance or acquiescence in a course of performance rendered under this Agreement shall not be relevant to determine the meaning of this Agreement even though the accepting or the acquiescing party has knowledge of the nature of the performance and an opportunity for objection. All waivers, amendments and modifications of this Agreement must be in writing, executed by a duly authorized officer of the party against whom enforcement of any waiver, modification or consent is sought. No waiver of any terms or conditions of this Agreement in one instance shall operate as a waiver of any other term or condition or as a waiver in any other instance.

     13.5 Construction Principles. As used in this Agreement words in any gender shall be deemed to include all other genders. The singular shall be deemed to include the plural and vice versa. The captions and article and section headings in this Agreement are inserted for convenience of reference only and are not intended to have significance for the interpretation of or construction of the provisions of this Agreement.

     13.6 Counterparts. This Agreement may be executed in two or more counterparts by the parties hereto, each of which when so executed will be an original, but all of which together will constitute one and the same instrument.

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     13.7 Severability. If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way unless such invalid or unenforceable provision or clause shall be so significant as to materially affect the parties’ expectations regarding this Agreement. Otherwise, the parties hereto agree to replace any invalid or unenforceable provision with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision.

     13.8 Expenses. The Initial Partners each agree to bear their own costs for all matters involved in the negotiation, execution and performance of this Agreement and related transactions unless otherwise specified herein and except for Reimbursable Fees and Expenses, as such term is defined in that certain Letter Agreement dated April 26, 2006, among MNG, Gannett Co., Inc. and Stephens Group, Inc., attached hereto as Schedule C.

     13.9 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware as applied to transactions taking place wholly within Delaware between Delaware residents.

     13.10 Binding Effect. Subject to the provisions of this Agreement relating to transferability, this Agreement shall be binding upon, and inure to the benefit of, the Partners and their respective permitted distributees, heirs, successors and assigns.

     13.11 Additional Documents and Acts. Each Partner agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions, and conditions of this Agreement and of the transactions contemplated hereby.

     13.12 No Third Party Beneficiary. This Agreement is made solely for the benefit of the parties hereto and their permitted distributees, heirs, successors and assigns and no other person shall have any rights, interest, or claims hereunder or otherwise be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise.

     13.13 Formation of Subsidiary Limited Partnership. As of March 31, 1999, the Partnership contributed all of the Partnership’s assets and liabilities relating to the business and assets of the newspapers listed on Exhibit 1 to this Agreement to a new California limited partnership established among the Partnership, SCM and West Coast MediaNews, pursuant to a limited partnership agreement (the “Limited Partnership, and the “Limited Partnership Agreement”). In exchange for (i) its contribution of such assets and liabilities to the Limited Partnership and (ii) its undertaking to guarantee the discharge/performance of all of the liabilities and obligations of the Limited Partnership, the Partnership received a Limited Partner interest in such Limited Partnership equal to 99.99% of all the partnership interests in the Limited Partnership. In exchange for cash

39

equal to .005% of the net value of the assets and liabilities transferred to the Limited Partnership, each of SCM and West Coast MediaNews received a general partnership interest in the Limited Partnership, equal to .05% of the total partnership interests in the Limited Partnership. Under the Limited Partnership Agreement the Partners contemplate that the rights of the Limited Partner shall not include any right which would in Gannett’s judgment cause the Federal Communications Commission (the “FCC”) to conclude that the Limited Partner is not sufficiently insulated from being able to exert influence over the media business of the Limited Partnership to preclude ownership of such business being attributed to the Limited Partner; provided, however that the Partners agree to reform the Limited Partnership in the event that FCC rules would permit the Partners to own the newspapers in such a structure but would not permit ownership (without disposition of a business) in the General Partnership structure.

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     IN WITNESS WHEREOF, each Partner has duly executed this Agreement as of the date hereof.

West Coast MediaNews LLC
By:	/s/ Joseph J. Lodovic, IV Joseph J. Lodovic, IV
	Its: President
Stephens California Media LLC
By:	SF Holding Corp.
By:	/s/ Jackson Farrow, Jr. Jackson Farrow, Jr.
	Sr. Vice President
The Sun Company of
	San Bernardino, California
By:	/s/ Daniel S. Ehrman, Jr. Daniel S. Ehrman, Jr.
	Authorized Representative
California Newspapers, Inc.
By:	/s/ Daniel S. Ehrman, Jr. Daniel S. Ehrman, Jr.
	Authorized Representative
Media West-SBC, Inc.
By:	/s/ Brooks Johnson Brooks Johnson
	President
Media West-CNI, Inc.
By:	/s/ Brooks Johnson Brooks Johnson
	President

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EX-21.1

EXHIBIT 21.1

SUBSIDIARIES OF MEDIANEWS GROUP, INC.

Subsidiary	State of Incorporation
Northwest New Mexico Publishing Company (59.4% ownership percentage in Texas-New Mexico Newspapers Partnership, which includes: Las Cruces Sun-News, The Deming Headlight, Alamogordo Daily News, Ruidoso News, The Daily Times (Farmington), Carlsbad Current-Argus, El Paso Times, York Daily Record, The York Dispatch, The Evening Sun (Hanover), Lebanon Daily News)	Delaware
Texas-New Mexico Newspapers Partnership	Delaware
The York Newspaper Company	Delaware
York Dispatch LLC	Delaware
York Daily Record — York Sunday News, LLC	Delaware
Los Angeles Daily News Publishing Company, (Daily News)	Delaware
Long Beach Publishing Company, (Press-Telegram)	Delaware
Graham Newspapers, Inc., (The Graham Leader, KSWA, KWKQ, KLXK, KROO)	Delaware
New England Newspapers, Inc. (North Adams Transcript, Brattleboro Reformer, Bennington Banner, The Berkshire Eagle (Pittsfield)	Delaware
New England Internet Media Publishing, Inc.	Delaware
Clock Tower Condominium Association	Delaware
Lowell Publishing Company, (The Sun)	Delaware
Lowell Internet Media Publishing Company, Inc.	Delaware
The Denver Post Corporation, (The Denver Post)	Delaware
Eastern Colorado Publishing Company	Delaware
MediaNews Group Interactive, Inc.	Delaware
Rate Watch, Inc.	Delaware
MNG/PowerOne Media Holding Company, Inc.	Delaware
West Coast MediaNews LLC (54.23% Ownership percentage in California Newspapers Partnership which includes: The Oakland Tribune, Tri-Valley Herald (Pleasanton), The Argus (Fremont), The Daily Review (Hayward), Alameda Times-Star, San Mateo County Times, Inland Valley Daily Bulletin (Ontario), Enterprise-Record (Chico), San Gabriel Valley Tribune, Whittier Daily News, Pasadena Star-News, Times-Standard (Eureka), Mercury-Register (Oroville), Times-Herald (Vallejo), Marin Independent Journal, Lake County Record-Bee (Lakeport), The Daily Democrat (Woodland), Ukiah Daily Journal, Redlands Daily Facts, Red Bluff Daily News, The Sun (San Bernardino), Paradise Post, The Reporter (Vacaville), Original Apartment Magazine, LA.com)	Delaware
California Newspapers Partnership	Delaware
California Newspapers Limited Partnership	Delaware
Connecticut Newspapers Publishing Company, (Connecticut Post)	Delaware
Alaska Broadcasting Company, Inc., (Northern Television, Inc. KTVA).	Alaska
MediaNews Services, Inc.	Delaware
Utah Media, Inc., (The Park Record)	Delaware
Kearns-Tribune, LLC, (The Salt Lake Tribune)	Delaware
Nimitz Paper Company	Delaware
The Detroit News, Inc., (The Detroit News)	Michigan
Charleston Publishing Company	Delaware

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, William Dean Singleton, certify that:

1.	I have reviewed this Annual Report on Form 10-K of MediaNews Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 26, 2006

/S/ William Dean Singleton William Dean Singleton

Vice Chairman, Chief Executive Officer and Director

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Joseph J. Lodovic, IV, certify that:

1.	I have reviewed this Annual Report on Form 10-K of MediaNews Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 26, 2006

/S/ Joseph J. Lodovic, IV Joseph J. Lodovic, IV

President

EX-31.3

EXHIBIT 31.3

CERTIFICATION

I, Ronald A. Mayo, certify that:

1.	I have reviewed this Annual Report on Form 10-K of MediaNews Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: September 26, 2006

/S/ Ronald A Mayo

Ronald A. Mayo

Vice President & Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K of MediaNews Group, Inc. (the “Company”) for the year ended June 30, 2006 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, William Dean Singleton, Vice Chairman, Chief Executive Officer and Director of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ WILLIAM DEAN SINGLETON William Dean Singleton,

Vice Chairman, Chief Executive Officer and Director

September 26, 2006

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report on Form 10-K of MediaNews Group, Inc. (the “Company”) for the year ended June 30, 2006 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ronald A. Mayo, Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ RONALD A. MAYO Ronald A. Mayo

Vice President and Chief Financial Officer

September 26, 2006