SEPARATION AGREEMENT – Gordon Paris

 

EXHIBIT 10.1

EXECUTION COPY

September 13, 2006

VIA HAND DELIVERY
PERSONAL AND CONFIDENTIAL

Gordon A. Paris
[address]

Re: Termination of Employment from Sun-Times Media Group, Inc.

Dear Gordon:

     This letter agreement (this “Agreement”) sets forth certain terms and conditions in connection with your termination of employment from Sun-Times Media Group, Inc. (“Sun-Times”) and its subsidiaries and affiliates, effective as of December 29, 2006 (the “Effective Date”). Upon the Effective Date, the Amended and Restated Employment Agreement, dated as of March 2, 2006, between you and Hollinger International Inc. (the “Employment Agreement”) shall terminate and be of no further force and effect, except as otherwise specifically provided herein. In consideration of the mutual covenants set forth below and other valuable consideration, including Sun-Times’s agreement to provide you with certain payments and benefits to which you are not otherwise entitled, the receipt and sufficiency of which Sun-Times (together with its parent corporations, affiliates, past and present officers, directors, stockholders, agents, employees, publications, legal representatives, successors, and assigns, hereinafter collectively referred to as, the “Company”) and you hereby acknowledge, Sun-Times and you hereby agree as follows:

     1. Termination of Employment.

     You have agreed to resign as of the Effective Date from employment with Sun-Times and its subsidiaries and affiliates to facilitate the relocation of the position of Chief Executive Officer of Sun-Times to Chicago, Illinois. As of the Effective Date, you will no longer be an employee of Sun-Times or any of its subsidiaries or affiliates. You shall continue to perform your regular duties and responsibilities through the Effective Date. Except as otherwise agreed by Sun-Times, following the Effective Date you shall relinquish all titles, positions and authorities that you held during your employment, with respect to Sun-Times and each and every subsidiary or affiliate of Sun-Times with which you have held positions as an officer and/or director, provided that you shall continue following the Effective Date as a member of the board of directors of Sun-Times (the “Board”) and the Chairman of the Special Committee of the Board until your termination or resignation from those positions in accordance with the Articles of Incorporation and By-laws of Sun-Times. You agree to execute any and all documents necessary to effect your resignation from all such positions. It is understood that there are some indirect subsidiaries of Sun-Times with respect to which it may be difficult to effect a change in membership of the board of directors by the Effective Date. In such circumstances, you agree to remain as a member of the board of directors and to cooperate with Sun-Times and each such subsidiary until such time as Sun-Times determines it appropriate for you to resign from such position.

     2.  Separation Benefits.

     You have the right to receive a lump sum payment for any accrued, unused vacation time, reduced by all applicable withholding taxes, regardless of whether you sign this Agreement. In

 


 

addition, in consideration of your full cooperation with Sun-Times and its subsidiaries and affiliates as described in Paragraph 3, and your agreement to the terms of the waivers and releases (as described in Paragraph 6), and to the other obligations set forth in this Agreement, Sun-Times shall provide you with the following:

     (a) Cash Severance Payment. You shall receive a cash lump sum payment in an amount equal to Two Million Seven Hundred Thousand Dollars ($2,700,000.00), determined in accordance with Paragraph 7B of the Employment Agreement as the amount of one year’s base salary and target bonus, plus a bonus for 2006 at target level. Such lump sum payment shall be payable within 10 business days following the Effective Date, subject to the last sentence of this Paragraph 2.

      (b) Treatment of Outstanding Cash Incentive Awards and Equity-Based Awards. Subject to the last sentence of this Paragraph 2, for purposes of the Cash Incentive Award (within the meaning of the Hollinger International Inc. 2006 Long-Term Incentive Plan (“LTIP”)) granted under the LTIP on December 9, 2005, including for the avoidance of doubt, the terms of Section 6(c)(x) of the LTIP (providing 6-month protection relating to certain awards following a Change in Control (as defined in the LTIP)), your employment shall not be deemed terminated until the later of (i) the Effective Date and (ii) the date on which you cease to be a member of the Board. On the date of such deemed termination of employment, such Cash Incentive Award shall become immediately vested and payable (if applicable) as and to the extent provided in the LTIP (if such Cash Incentive Award has not already been settled as a result of the prior expiration of the scheduled performance period), except that such Cash Incentive Award shall not be subject to proration as provided in the LTIP. Subject to the last sentence of this Paragraph 2, all equity-based awards (excluding the Cash Incentive Award referred to in the previous sentence) previously granted to you under the LTIP or otherwise shall become immediately fully vested and payable (if applicable) as of the Effective Date, and Sun-Times shall cause the underlying shares to be distributed to you on December 29, 2006.

     (c) Health and Welfare Benefits Continuation. If you so elect, Sun-Times will continue to provide you, at Sun-Times’s expense, subject to the last sentence of this Paragraph 2, with health and welfare benefits in which you were enrolled as of the Effective Date (including group medical, dental, vision, life insurance and disability insurance, individual supplemental life insurance and, if applicable, any individual supplemental disability insurance in effect) at a level consistent with that provided to employees of Sun-Times (or to you, in the case of the individual supplemental life and disability insurance coverages) until December 31, 2007. With respect to any such health and welfare benefits subject to COBRA (as defined in Paragraph 5), Sun-Times may satisfy its obligations under this Paragraph 2(c) by providing you such coverages under COBRA and paying 100% of the cost of your COBRA premiums.

     (d) 401(k) Plan. Subject to the last sentence of this Paragraph 2, Sun-Times will make an additional cash payment to you in an amount equal to the portion of your account balance under, or any company matching contributions to, the 401(k) plan of Sun-Times and its subsidiaries in which you participate on the Effective Date, in each case that you will forfeit or not otherwise receive solely by reason of your employment termination date being December 29, 2006 instead of December 31, 2006 (including any company matching contribution that you would have otherwise been entitled to receive for 2006 and the portion of your account balance that would have vested had you remained employed through December 31, 2006). Such payment shall be payable at the time the company matching contribution would be made by Sun-Times and its subsidiaries under the 401(k) plan to other 401(k) plan participants, but in no event later than March 15, 2007.

     Notwithstanding the foregoing, subject to the last sentence of this Paragraph 2, in the event a Change in Control (as defined in the Employment Agreement) occurs on or prior to December 31, 2006, then you shall be entitled to receive the payments and benefits set forth in Paragraph 7C of the

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Employment Agreement (the “Change in Control Benefits”) (in lieu of the payments and benefits set forth in Paragraphs 2(a), 2(b) and 2(c) of this Agreement) to the extent the Change in Control Benefits are greater then the payments and benefits set forth in Paragraphs 2(a), 2(b) and 2(c) of this Agreement.

     Notwithstanding the foregoing, payments under Paragraphs 2(a) (or the corresponding Change in Control Benefit, as applicable) and 2(d) shall not be payable until you execute and deliver a waiver and release of claims in favor of the Company (that contains provisions substantially identical to the provisions of Sections 6 , 7, 8(b), 8(c) and 11 of this Agreement, but which is dated as of the Effective Date) that becomes fully effective and enforceable in accordance with its terms (i.e., upon the eighth day following the date you have signed such waiver and release so long as you have not previously revoked such waiver and release), and your entitlement to the benefits under Paragraphs 2(b) and (c) (or the corresponding Change in Control Benefits, as applicable) shall be void ab initio if you do not execute and deliver such waiver and release or revoke such waiver and release before it becomes fully effective and enforceable in accordance with its terms (it being understood that in order to receive the distribution of shares under Paragraph 2(b) (or the corresponding Change in Control Benefit, as applicable) on December 29, 2006, you shall be required to provide an additional substantially identical waiver and release as of December 21, 2006).

     3. Cooperation.

     (a) You further agree that, upon reasonable notice and without the necessity of the Company obtaining a subpoena or court order, you shall provide reasonable cooperation in connection with any suit, action or proceeding (or any appeal from any suit, action or proceeding), and any investigation and/or defense of any claims asserted against the Company, which relates to events occurring during your employment with Sun-Times and its subsidiaries and affiliates (and their predecessors and successors) as to which you may have relevant information (including but not limited to furnishing relevant information and materials to the Company or its designee and/or providing testimony at depositions and at trial).

     (b) Sun-Times agrees to reimburse you for all reasonable out-of-pocket expenses associated with the provision of such reasonable cooperation, subject to the provision of detailed invoices for all expenses so incurred. In requesting your services from time to time and such reasonable cooperation, Sun-Times shall make reasonable efforts to accommodate your schedule and the requirements of your employer.

     4. Return of Confidential Information; Nondisparagement; Return of Company Property.

     (a) Without limiting the provisions of Section 8 of the Employment Agreement (which shall survive the termination of the Employment Agreement and continue in effect in accordance with its terms), you agree to return to Sun-Times and its subsidiaries and affiliates following the date on which you cease to be a member of the Board any and all confidential and proprietary information you have acquired regarding Sun-Times and its subsidiaries and affiliates, including information about their personnel, policies, publications, business practices, strategic plans, advertisers, customers, suppliers, distributors, readers, financial forecasts, production data, marketing techniques, promotional plans, and financial information, and to hold in the strictest confidence, except as required by applicable law, and not to disclose any of said information to anyone, and to refrain from making any statements or representations to any employee of Sun-Times and its subsidiaries and affiliates or to their customers, suppliers, competitors or the public at large which might disparage or have a detrimental effect on Sun-Times’s and its subsidiaries’s and affiliates’s business, operations, public image, reputation or their relations with advertisers, customers, suppliers, employees, lenders, competitors, or other business associates.

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     (b) Sun-Times agrees that you shall be entitled to retain any personal computing equipment provided to you by Sun-Times and its subsidiaries and affiliates, including any PCs and laptops, subject to the condition that, following the date on which you cease to be a member of the Board, Sun-Times be permitted to remove from such equipment all proprietary software and documents. You may also retain the Blackberry provided to you by Sun-Times and its subsidiaries and affiliates, subject to the same condition set forth immediately above. All other property of Sun-Times and its subsidiaries and affiliates which you have in your possession including, but not limited to, all access cards, facility keys and credit cards, shall be returned to Sun-Times and its subsidiaries and affiliates following the date on which you cease to be a member of the Board, except as otherwise agreed to between you and Sun-Times.

     5. COBRA Generally.

     The Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) requires that, in certain cases, terminated employees be allowed to continue their medical and dental insurance beyond their separation date at their own expense. An explanation of your rights under COBRA will be sent to you under separate cover at a future date.

     6. Release.

     (a) You hereby agree to WAIVE any and all rights in connection with, and to fully RELEASE and forever discharge the Company from, any and all torts, contracts, claims, suits, actions, causes of action, demands, rights, damages, costs, expenses, attorneys fees, and compensation in any form whatsoever, whether now known or unknown, in law or in equity, which you have or ever had (from the beginning of time through and including the date hereof) against the Company, including without limitation on account of or in any way arising out of, relating to or in connection with your employment by or separation of employment from Sun-Times and its subsidiaries and affiliates (and their predecessors and successors), and any and all claims for damages or injury to any entity, person, property or reputation arising therefrom, claims for wages, employment benefits, tort claims and claims under Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Civil Rights Act of 1866, the Employee Retirement Income Security Act of 1974, the National Labor Relations Act, the Fair Labor Standards Act, the Rehabilitation Act of 1973, the Family and Medical Leave Act of 1993, the Americans with Disabilities Act of 1990, the Illinois Human Rights Act, the Illinois Wage Payment and Collection Act, the Cook County Human Rights Ordinance, the Chicago Human Rights Ordinance and any other federal, state or local law, statute, ordinance, guideline, regulation, order or common-law principle of any state relating to employment, employment contracts, wrongful discharge or any other matter; provided, however, that the foregoing waiver and release shall not apply to your rights in respect of any benefit or claim to which you are entitled under employee pension or welfare benefit plans and programs of Sun-Times and its subsidiaries and affiliates in which you are a participant prior to the Effective Date, or to your rights to enforce this Agreement.

     (b) Release of Age Discrimination Claims. In further consideration of the promises made by the Company in this Agreement, you specifically WAIVE any and all rights in connection with, and fully RELEASE and forever discharge the Company from, any and all torts, contracts, claims, suits, actions, causes of action, demands, rights, damages, costs, expenses, attorneys fees, and compensation in any form whatsoever, whether now known or unknown, in law or in equity, which you have or ever had (from the beginning of time through and including the date hereof) against the Company, arising under the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. Sec. 621, et seq. (“ADEA”). You further agree that:

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(i)

 

your waiver of rights under this release is knowing and voluntary and in compliance with the Older Workers Benefit Protection Act of 1990;

 

 

 

 

 

(ii)

 

you understand the terms of this release;

 

 

 

 

 

(iii)

 

the consideration provided in Paragraph 2 represents consideration over and above that to which you otherwise would be entitled, that the consideration would not have been provided had you not signed this release, and that the consideration is in exchange for the signing of this release;

 

 

 

 

 

(iv)

 

the Company is hereby advising you in writing to consult with your attorney prior to executing this release;

 

 

 

 

 

(v)

 

the Company is giving you a period of twenty-one days within which to consider this release;

 

 

 

 

 

(vi)

 

following your execution of this release you have seven (7) days in which to revoke this release by written notice. To be effective, the revocation must be made in writing and delivered to and received by Pamela A. Davidson, Assistant Corporate Counsel, Sun-Times Media Group, Inc., 350 North Orleans, 10 South, Chicago, Illinois 60654, no later than 4:00 p.m. on the seventh day after you execute this release. An attempted revocation not actually received by Ms. Davidson before the revocation deadline will not be effective; and

 

 

 

 

 

(vii)

 

this entire Agreement shall be void and of no force and effect if you choose to so revoke, and if you choose not to so revoke this Agreement shall then become fully effective and enforceable.

     This Paragraph 6(b) does not waive rights or claims that may arise under the ADEA after the date you sign this Agreement. In addition, nothing in this Agreement shall in any way affect your right to the indemnification and expense advancement to the extent provided by Sun-Times’s bylaws and Restated Certificate of Incorporation, as amended; provided, however, that the Company shall not be liable, and shall not provide a defense and indemnification for any claim wherein you have not satisfied the applicable standard of conduct set forth in such by-laws and Restated Certificate of Incorporation, or wherein you have committed any acts of fraud, embezzlement or gross misconduct.

     7. Proceedings; No Admissions.

     (a) You hereby represent and warrant that: (i) you have no pending claims against the Company with any municipal, state, federal or other governmental or nongovernmental entity; and (ii) you will not file any claims with respect to any events occurring on or before the date hereof. You also acknowledge and agree that by entering into this Agreement you can never make claim or demand upon or sue the Company for any reason whatsoever relating to anything that has happened through the date hereof. Notwithstanding the foregoing, this Agreement shall not prevent you from (A) initiating or causing to be initiated on your behalf any complaint, charge, claim or proceeding against Sun-Times or its subsidiaries and affiliates before any local, state or federal agency, court or other body challenging the validity of the waiver of your claims under the ADEA contained in this Agreement (but no other portions of the waivers and releases described in Paragraph 6); or (B) initiating or participating in an investigation or proceeding conducted by the Equal Employment Opportunity Commission with respect to the ADEA.

     (b) Both parties acknowledge and agree that this Agreement does not constitute, is not intended to be, and shall not be construed, interpreted or treated in any respect as, and shall not be

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admissible in any proceeding as, an admission of liability, error, violation, omission or wrongdoing by either party for any purpose whatsoever. Further, both parties acknowledge and agree that there has been no determination that either party has violated any federal, state or local law, statute, ordinance, guideline, regulation, order or common-law principle. You further acknowledge that no precedent, practice, policy or usage shall be established by this Agreement or the offer to you of compensation and benefits herein.

     8. Continuing Obligations; Remedies.

     (a) Should you damage the reputation, goodwill or competitive position of Sun-Times or its subsidiaries or affiliates, or if you cause, directly or indirectly, any key executive employee of Sun-Times or its subsidiaries or affiliates to terminate his or her employment with Sun-Times or its subsidiaries or affiliates (except that you shall be permitted to respond to unsolicited requests for references), then Sun-Times will be entitled to reimbursement from you of the full amount of separation pay and other compensation and benefits that you have received under this Agreement through the date of such action by you, and Sun-Times will also be entitled to obtain injunctive relief against your continuing any such action.

     (b) You also understand and agree that in the event you, your heirs, spouse, family members, executors, or administrators attempt to institute or do institute any charge, claim, suit or action against the Company in violation of this Agreement, you shall be obligated, as an express condition of bringing such action, to tender back to Sun-Times the full amount of separation pay and other compensation and benefits that you have received under this Agreement; and you further agree that you will pay all of the Company’s costs, expenses and fees of defending against such action, including among other things, reasonable attorney’s fees. This paragraph does not grant you an option to return the money and institute an action. Instead this paragraph merely creates an additional term and condition precedent to bringing an action regardless of the fact that such action is expressly barred by this Agreement, and is without merit.

     (c) Should you breach any other term of this Agreement, including but not limited to filing any claim which you have agreed to release and waive under this Agreement or breaching any of the provisions of this Agreement, the Company will be entitled to recover damages for such breach and also to obtain injunctive relief against further breach by you. If Sun-Times or you at any time believe that the other party has breached any term of this Agreement, the party claiming a breach shall promptly notify the other in writing (if to you, at your address set forth on page 1 hereof; if to Sun-Times, to the contact person at the address specified in Paragraph 6(b)(vi)) of the specific basis for that belief, and the other party will have a period of ten (10) days within which to cure any breach (if cure is possible) or to otherwise respond to the claim of breach.

     (d) Notwithstanding anything to the contrary in this Agreement, the parties acknowledge and agree that the provisions of Sections 7D, 9, 17 and 18 of the Employment Agreement shall survive the termination of the Employment Agreement and continue in full force and effect in accordance with their terms.

     9. Arbitration of Disputes; Payment of Expenses.

     Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by arbitration proceedings conducted in accordance with the commercial rules of the American Arbitration Association (“AAA”) as then in effect. Any arbitration shall be held in Chicago, Illinois. The arbitrator shall be selected by joint agreement of the Company and you, but if such agreement is not reached within seven (7) days of the date of the request for arbitration, the selection shall be made by the AAA in accordance with its commercial rules. Judgment upon any award rendered by the arbitrator may be entered in any court having jurisdiction. The costs and

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expenses of the arbitrator and all costs and expenses of experts, attorneys, witnesses and other parties reasonably incurred by the prevailing party shall be borne by the party that does not prevail in such arbitration or in any court proceeding relating to enforcement of this Agreement.

     10. Governing Law.

     This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York without regard to principles of conflicts of laws.

     11. Acknowledgments; Revocation of Release.

     You hereby acknowledge (a) that the Company has given you a period of at least twenty one (21) days in which to review and consider this Agreement; (b) that the Company has advised, and does hereby in writing advise, you to consult with an attorney before signing this Agreement; (c) that you have read this Agreement in its entirety; (d) that you have had at least twenty one (21) days in which to confer with your own attorney for assistance and advice concerning this Agreement; (e) that you understand the terms of this Agreement; (f) that you understand that the terms of this Agreement are legally enforceable; (g) that you have entered into this Agreement freely, voluntarily, knowingly and willingly and were in no manner coerced into signing it; (h) that neither this Agreement nor the discussion and negotiation leading to it are or were, in any manner, discriminatory; (i) that you were, and hereby are, encouraged to discuss any questions, problems, or issues concerning this Agreement with the Company before signing it; (j) that you are waiving rights and claims you may have in exchange for consideration in addition to things of value to which you are already entitled; and (k) that after signing this Agreement you have a period of seven (7) days in which to revoke this Agreement, however, any such revocation must be in writing and must be addressed to Pamela A. Davidson, Assistant Corporate Counsel, Sun-Times Media Group, Inc., 350 North Orleans, 10 South, Chicago, Illinois 60654.

     12. Withholding.

     The Company may deduct and withhold from any amounts payable under this Agreement such Federal, state, local, non-U.S. or other taxes as are required or permitted to be withheld pursuant to any applicable law or regulation.

     13. Amendment; No Waiver; Interpretation.

     No provisions of this Agreement may be amended, modified, waived or discharged except by a written document signed by you and a duly authorized officer of Sun-Times (other than you). The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive such party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement. No failure or delay by either party in exercising any right or power hereunder will operate as a waiver thereof, nor will any single or partial exercise of any such right or power, or any abandonment of any steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. No provision of this Agreement or any related document will be construed against or interpreted to the disadvantage of any party hereto by any court or other governmental or judicial authority by reason of such party having or being deemed to have structured or drafted such provision.

     14. Severability.

     If any term or provision of this Agreement is invalid, illegal or incapable of being enforced by any applicable law or public policy, all other conditions and provisions of this Agreement shall nonetheless remain in full force and effect to the fullest extent permitted by law. You agree that in

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the event that any court of competent jurisdiction shall finally hold that any provision of this Agreement (whether in whole or in part) is void or constitutes an unreasonable restriction against you, such provision shall not be rendered void but shall be deemed to be modified to the minimum extent necessary to make such provision enforceable for the longest duration and the greatest scope as such court may determine constitutes a reasonable restriction under the circumstances.

     15. Entire Agreement.

     This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings (whether written or oral), between you and the Company relating to such subject matter. None of the parties shall be liable or bound to any other party in any manner by any representations and warranties or covenants relating to such subject matter except as specifically set forth herein.

     16. Binding on Successors.

     This Agreement shall be binding on, and shall inure to the benefit of, the parties to it and their respective heirs, legal representatives, successors and permitted assigns (including, without limitation, in the event of your death, your estate and heirs in the case of any payments due to you hereunder).

     17. No Other Benefits.

     You agree that you are not entitled to any other compensation or benefits in connection with your termination of employment (other than pursuant to the terms of the employee benefit plans and programs of Sun-Times and its subsidiaries and affiliates in which you participated prior to the Effective Date, provided that you explicitly waive any right to receive any severance or similar benefits under such plans and programs (including without limitation any benefits under the Key Employee Severance Plan)).

     18. Counterparts.

     This Agreement may be executed in one or more counterparts (including via facsimile and electronic image scan (pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.

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     Gordon, please indicate your understanding and acceptance of this Agreement by executing both copies below, and retaining one fully executed original for your files and returning one fully executed original to me.

 

 

 

 

 

 

 

 

 

Very truly yours,

 

 

 

 

 

 

 

 

 

 

 

SUN-TIMES MEDIA GROUP, INC

 

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

 

Cyrus F. Freidheim, Jr.

 

 

 

 

Title:

 

Chairman of Compensation Committee

I hereby accept the terms of this
Agreement and agree to abide by the provisions hereof:

 

 

 

 

 

 

 

 

 

 


 Gordon A. Paris

 

 

 

 

 

 

 

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

 

 

 

 

9

 
 
EMPLOYMENT AGREEMENT
 
 
         THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is made and entered into as
of the 1st day of January, 2005, by and between Hollinger International Inc., a
Delaware corporation (the "EMPLOYER"), and Gordon A. Paris (the "EXECUTIVE").
 
 
                                    RECITALS
 
 
         A.       The Employer desires that the Executive continue to provide
services for the benefit of the Employer and the Executive desires to accept
such continued employment with the Employer.
 
         B.        The Employer and the Executive acknowledge that the Executive
is, and will continue to be, a member of the senior management team of the
Employer and, as such, has participated in and will participate in implementing
the Employer's business plan.
 
         NOW, THEREFORE, in consideration of the above premises and the
following mutual covenants and conditions, the parties agree as follows:
 
         1.       EMPLOYMENT. The Employer shall employ the Executive as its
President and Chief Executive Officer, and the Executive hereby accepts such
employment on the following terms and conditions.
 
         2.       DUTIES. The Executive shall work for the Employer in a
full-time capacity. The Executive shall, during the term of this Agreement, have
the duties, responsibilities, powers, and authority customarily associated with
the positions of President and Chief Executive Officer. The Executive shall
report to, and follow the direction of, the Board of Directors. In addition to,
or in lieu of, the foregoing, the Executive also shall perform such other duties
as may be assigned to him from time to time by the Board of Directors. The
Executive shall diligently, competently, and faithfully perform all duties, and
shall devote his entire business time, energy, attention, and skill to the
performance of duties for the Employer and will use his best efforts to promote
the interests of the Employer; provided the Executive shall be entitled to
devote time to the business activities of Berenson & Company, outside boards of
directors, personal investments, and professional activities to the extent such
activities do not unduly interfere with his duties hereunder.
 
         3.       TERM OF EMPLOYMENT. This Agreement shall be entered into for a
period of one (1) year, commencing January 1, 2005 (the "INITIAL TERM"). The
term of employment shall be renewed for successive periods of one (1) year (a
"RENEWAL TERM") after the expiration of the Initial Term and any subsequent
Renewal Term, unless the Board of Directors provides the Executive, or the
Executive provides the Board of Directors, with written notice to the contrary
at least sixty (60) days prior to the end of the Initial Term or any Renewal
Term.         
4.       COMPENSATION.
 
                  A.     SALARY. The Employer shall pay the Executive an annual
         salary of $2,000,000, less an amount equal to the annual base salary
         paid to Executive by Berenson & Company (the "BASE SALARY"), payable in
         substantially equal installments in accordance with the Employer's
         payroll policy from time to time in effect. The Executive's salary
         shall be subject to any payroll or other deductions as may be required
         to be made pursuant to law, government order, or by agreement with, or
         consent of, the Executive. The Base Salary is subject to increase at
         the discretion of the Board of Directors, or a Committee thereof acting
         under delegated authority, as appropriate.
 
                  B.     PERFORMANCE BONUS. The Executive shall be eligible for
         an annual bonus targeted at fifty percent (50%) of the Executive's Base
         Salary (the "TARGET BONUS"), such bonus, if any, to be paid within
         ninety (90) days following the end of each calendar year during the
         term hereof, beginning with calendar year 2005. The bonus shall be
         based upon an annual calendar year bonus plan, to be established by the
         Board of Directors of Employer as soon as reasonably practicable after
         the date hereof. The actual bonus to be paid to Executive shall be
         determined by the Board of Directors, or by a Committee thereof with
         delegated authority, based upon such criteria as are established by the
         Board or such Committee and communicated to Executive. The actual bonus
         to be paid to Executive may exceed or be lower than the Target Bonus,
         based upon performance relative to the established criteria.
 
                  C.     RESTRICTED STOCK UNITS. Executive will receive (i) a
         one-time grant of 8,445 Restricted Stock Units (as adjusted from time
         to time for special dividends or other events) on the earlier to occur
         of November 16, 2005 or the date of the termination Executive's
         employment for any reason; and (ii) an annual grant of 68,494
         Restricted Stock Units (as adjusted from time to time for special
         dividends or other events) on January 1 of each calendar year beginning
         on January 1, 2006; provided that Executive must be employed by the
         Employer as its President and Chief Executive Officer on the dates of
         such grants. For the avoidance of doubt, it is the parties' intention
         that Executive shall be entitled to receive the one-time grant of 8,445
         Restricted Stock Units (as adjusted from time to time for special
         dividends or other events) if his employment is terminated prior to
         November 16, 2005. Each Restricted Stock Unit will entitle Executive to
         receive one share of Employer's common stock upon the termination of
         his employment. The terms of the Restricted Stock Units are set forth
         in the Deferred Stock Unit Agreement, attached hereto as EXHIBIT A and
         incorporated herein by this reference.
 
                  D.     OTHER COMPENSATION. Executive shall be eligible to
         participate in any and all other incentive compensation programs
         established by Employer in which Employer's senior executives
         participate or with respect to which they are eligible. The Board of
         Directors, or a Committee thereof with delegated authority, shall
         determine the amount of any such awards in its sole discretion.
 
                  E.     BENEFITS AND PERQUISITES. Executive shall be eligible
         to participate in all benefit plans and programs for which other senior
         executives of Employer are eligible, and shall be entitled to such
         perquisites as are available to other senior executives of Employer,
         and such additional perquisites as may be approved by the Board of
         Directors or the Compensation Committee thereof.
 
         5.       EXPENSES. The Employer shall reimburse the Executive for
expenses in accordance with the Employer's policies from time to time in effect.
 
 
         6.       TERMINATION. The Executive's services shall terminate upon the
first to occur of the following events:
 
                  A.     At the end of the term of this Agreement, including any
         Renewal Terms.
 
                  B.     Upon the Executive's date of death or the date the
         Executive is given written notice from the Employer that he has been
         determined to be disabled. For purposes of this Agreement, the
         Executive shall be deemed to be "disabled" if the Executive, as a
         result of illness or incapacity, shall be unable to perform
         substantially his required duties for a period of three (3) consecutive
         months or for any aggregate period of three (3) months in any six (6)
         month period.
 
                  C.     On the date the Employer provides the Executive with
         written notice that he is being terminated for "cause." For purposes of
         this Agreement, "cause" means that Executive has: (i) been convicted of
         (or has pleaded guilty or no contest to) a felony, or (ii) engaged in
         conduct that constitutes willful gross neglect or willful gross
         misconduct with respect to his employment duties; PROVIDED, no act or
         omission on Executive's part shall be considered "willful" if conducted
         in good faith and with a reasonable belief that his conduct was in the
         best interests of Employer. Notwithstanding the foregoing, the Employer
         may not terminate Executive's employment for cause under clause (ii) of
         this Paragraph 6C unless Executive is given at least thirty (30) days
         to cure any such conduct (if capable of cure), and only after Executive
         has received a certified copy of a resolution of the Board of Directors
         terminating his employment for cause and stating specifically the
         conduct that the Board of Directors believes satisfies the definition
         of cause.
 
                  D.     On the date the Executive terminates his employment for
         any reason, provided that the Executive shall give the Employer thirty
         (30) days written notice prior to such date of his intention to
         terminate this Agreement.
 
                  E.     On the date the Employer terminates the Executive's
         employment for any reason other than in the event of Executive's death
         or disability or for cause, provided that the Employer shall give the
         Executive sixty (60) days written notice prior to such date of its
         intention to terminate this Agreement.
 
         7.       COMPENSATION UPON TERMINATION.
 
                  A.     If the Executive's services are terminated pursuant to
         Paragraph 6B, 6C or (except as provided in Paragraph 7C) 6D, or the
         Executive elects to terminate this Agreement at the end of its term
         pursuant to Paragraph 6A, the Executive shall be entitled to his salary
         and health and welfare benefits through his final date of active
         employment, plus any accrued but unused vacation pay. The Executive
         shall also be entitled to any benefits mandated under the Consolidated
         Omnibus Budget Reconciliation Act of 1985 ("COBRA") or required under
         the terms of any death, insurance, or retirement plan, program, or
         agreement, or any other plan or arrangement, provided by the Employer
         and to which the Executive is a party or in which the Executive is a
         participant, including, but not limited to, any short-term or long-term
         disability plan or program, if applicable.
 
                  B.     If the Executive's services are terminated by the
         Employer pursuant to Paragraph 6A or 6E prior to and not in connection
         with a Change in Control (as defined herein), Executive shall receive
         (i) continuation of his final Base Salary for a period ending one year
         from the expiration of the term of this Agreement, (ii) continuation of
         health and welfare benefits for such         period, and (iii) an amount equal to Executive's Target Bonus on all
         amounts paid pursuant to clause (i) of this Paragraph 7B and all
         amounts paid to Executive as Base Salary during the then-current term
         of this Agreement, to be paid within ninety (90) days following the end
         of each calendar year during the period of Executive's salary
         continuation under clause (i) of this Paragraph 7B. Upon termination of
         Executive's employment pursuant to this Paragraph 7B, all unvested
         equity-based awards shall become immediately fully vested and payable
         (if applicable). Employer's obligations to pay the amounts and furnish
         the benefits as provided in this Paragraph 7B shall be conditioned upon
         receipt by Employer of Executive's written release of the Employer from
         all claims for additional severance payments and benefits and
         otherwise.
 
                  C.     In the event of a Change in Control, and the subsequent
         termination, within thirty-six (36) months after the Change in Control,
         of Executive's employment by Employer without cause or by Executive for
         Good Reason, the Executive shall be entitled to his salary and health
         and welfare benefits through his final date of active employment, plus
         any accrued but unused vacation pay, plus an amount equal to
         Executive's Target Bonus on his salary through his final date of active
         employment. In addition, Executive shall receive (i) a lump sum amount
         equal to (a) Executive's final Base Salary, multiplied by two (2), plus
         (b) the higher of Executive's Target Bonus or the highest annual bonus
         actually received by Executive during the two most recent years,
         multiplied by two (2); and (ii) continuation of Executive's health and
         welfare benefits for a period ending two years from the date of the end
         of the term of this Agreement. In addition, upon a Change in Control,
         all unvested awards and grants previously made to Executive shall
         become immediately fully vested and payable (if applicable). For
         purposes of this Paragraph 7C, "Good Reason" for termination of
         Executive's employment by Executive shall exist if a Change of Control
         has occurred and, at any time during the thirty-six (36) months
         thereafter, any of the following has also occurred: Executive's title,
         authority or principal duties are reduced, diminished or eliminated;
         Executive's base salary is reduced; Executive's benefits are
         diminished; Executive's principal place of employment is relocated more
         than thirty-five (35) road miles from its then-current location; or
         Executive's annual bonus opportunity is reduced. For purposes of this
         Paragraph 7C, a "CHANGE IN CONTROL" shall be deemed to have occurred
         upon:
 
                  (1)    the acquisition after the date of this Agreement by any
                  "person" (as defined in Sections 13(d) and 14(d) of the
                  Securities Exchange Act of 1934, as amended (the "EXCHANGE
                  ACT") (excluding for this purpose, (i) the Employer or any
                  subsidiary of the Employer or (ii) any employee benefit plan
                  of the Employer or of any subsidiary of the Employer or any
                  person or entity organized, appointed or established by the
                  Employer for or pursuant to the terms of any such plan which
                  acquires after the date of this Agreement beneficial ownership
                  of voting securities of the Employer) of ownership of
                  securities of the Employer whereby such person becomes the
                  "beneficial owner" (as defined in Rule 13d-3 under the
                  Exchange Act), directly or indirectly of securities of the
                  Employer representing more than fifty percent (50%) of the
                  combined voting power of the Employer's then outstanding
                  securities; provided, however, that no Change in Control will
                  be deemed to have occurred as a result of a change in
                  ownership percentage resulting solely from an acquisition of
                  securities by the Employer; or
 
                  (2)    Richard R. Burt, Henry A. Kissinger, Shmuel Meitar,
                  Gordon A. Paris, Graham W. Savage, Raymond G.H. Seitz, James
                  R. Thompson (collectively, "INCUMBENT DIRECTORS") and any new
                  directors whose election by the Board of Directors or
                  nomination by the Board of Directors for election by the
                  Employer's stockholders was approved by a vote of a least
                  two-thirds (2/3) of the directors then still in office who
                  either are Incumbent Directors or whose election or nomination
                  for election was previously so approved (such new directors
                  being referred to as "SUCCESSOR INCUMBENT DIRECTORS") ceasing
                  for any reason to constitute at least a majority of the Board
                  of Directors;
 
                  (3)    the adoption, enactment or effectiveness of any action
                  (including, without limitation, by resolution or by amendment
                  to the Employer's charter or bylaws) that materially limits or
                  diminishes the power or authority of the Employer's board of
                  directors or any committee thereof, if such action has not
                  been approved by a vote of a least two-thirds (2/3) of the
                  directors then still in office who either are Incumbent
                  Directors or Successor Incumbent Directors; or
 
                  (4)    the consummation of, or the execution of a definitive
                  agreement the consummation of which would result in, a
                  reorganization, merger or consolidation, or sale or other
                  disposition of all or substantially all of the assets of the
                  Employer (a "BUSINESS COMBINATION"), in each case, unless,
                  following such Business Combination, all or substantially all
                  of the individuals and entities who were the beneficial owners
                  of outstanding voting securities of the Employer immediately
                  prior to such Business Combination beneficially own, directly
                  or indirectly, more than fifty percent (50%) of the combined
                  voting power of the then outstanding voting securities
                  entitled to vote generally in the election of directors of the
                  entity resulting from such Business Combination (including,
                  without limitation, an entity which, as a result of such
                  transaction, owns the Employer, or all or substantially all of
                  the Employer's assets, either directly or through one or more
                  subsidiaries) in substantially the same proportions as their
                  ownership, immediately prior to such Business Combination, of
                  the outstanding voting securities of the Employer; or
 
                  (5)    the consummation of a complete liquidation or
                  dissolution of the Employer.
 
                  D.     If the Executive is subject to a tax pursuant to
         Section 4999 of the Internal Revenue Code of 1986, as amended (the
         "CODE"), or any successor provision that may be in effect, as a result
         of "parachute payments" (as that term is defined in Section
         280G(b)(2)(A) and (d)(3) of the Code) made pursuant to this Agreement,
         the Employer shall pay to Executive, in advance, all sums necessary to
         pay any such tax, plus an amount necessary to gross-up such payments
         for income and employment taxes relating to such payments and such
         gross-up payments, plus any penalties and interest on such taxes (to
         the extent caused by the Employer).
 
         8.       CONFIDENTIAL INFORMATION. Executive acknowledges that the
Confidential Information (as defined herein) obtained by him concerning the
business and affairs of the Employer and its affiliates and its and their
predecessors during the course of his performance of services for, or employment
with, any of the foregoing persons (whether or not compensated for such
services) are the property of the Employer and its affiliates. Therefore,
Executive agrees that he will not at any time (whether during or after his
employment period) disclose to any unauthorized person or, directly or
indirectly, use for his own account, any Confidential Information without the
Board of Directors' consent. Executive agrees to deliver to the Employer at the
termination of his employment, or at any other time the Employer may request in
writing (whether during or after his employment period), all memoranda, notes,
plans, records, reports and other documents, regardless of the format or media
(and copies thereof), relating to the business of the Employer and its
affiliates and its and their predecessors which he may then possess or have
under his control and which contain Confidential Information. As used herein,
"CONFIDENTIAL INFORMATION" means information or materials of a confidential or
proprietary nature and includes, but isnot limited to, (a) matters of a technical nature, such as trade secrets,
methods, data and know-how, inventions, designs, machines, computer programs or
printouts, and documentation and similar items or research projects, and (b)
matters of a business nature, such as information about past, present, or future
company performance, correspondence, notes, reports, files, financial
information, sales figures and projections, budgets, marketing plans, price
lists, strategies, and lists of actual or potential customers, partners, or
investors. Notwithstanding the foregoing, Confidential Information shall not
include information that is generally ascertainable from public or published
information or trade sources.
 
         9.       NONCOMPETITION AND NONSOLICITATION OF EMPLOYEES.
 
                  A.     Executive covenants and agrees that, during Executive's
         employment with the Employer and for the period of one (1) year after
         the effective date of Executive's termination for whatever reason (the
         "RESTRICTED TERM"), he will not (a) be employed in an executive or
         managerial capacity by, or (b) provide whether as an employee,
         independent contractor, consultant, or otherwise, any services of an
         executive or managerial nature or any services similar to those
         provided by Executive to the Employer during Executive's employment
         with the Employer to, any company or entity engaged in the production
         or sale of newspapers or news magazines in any market which is served
         by the Employer or which the Employer is actively preparing to serve at
         the time of Executive's termination of employment. Executive
         acknowledges that the restrictions contained in this Paragraph 9A are
         necessary to protect the Employer's legitimate interests in its
         Confidential Information and customer relationships.
 
                  B.     NONSOLICITATION OF EMPLOYEES. Executive covenants and
         agrees that during Executive's employment with the Employer and the
         Restricted Term, other than in the proper performance of Executive's
         duties while employed by the Employer, Executive will not employ,
         retain, solicit, attempt to solicit, knowingly assist in the employment
         or retention of, or seek to influence or induce to leave the Employer's
         employment or service any individual who is employed or retained as an
         independent contractor by the Employer at any time during the two (2)
         year period prior to Executive's date of termination. Executive
         acknowledges that the restrictions contained in this Paragraph 9B are
         necessary to protect the Employer's legitimate interests in its
         Confidential Information, customer relationships, and employee
         relationships.
 
                  C.     INJUNCTIVE RELIEF. Executive acknowledges and agrees
         that any breach or threatened breach by Executive of Paragraphs 8 and 9
         of this Agreement will cause irreparable harm and continuing damages to
         the Employer and that the remedy at law for any such breach or
         threatened breach will be inadequate. Accordingly, in addition to any
         other remedies that may be available to the Employer at law or in
         equity in such event, the Employer shall be entitled to seek and
         obtain, from any court of competent jurisdiction, an injunction or
         injunctions, without bond or other security and without having to show
         that money damages will be inadequate or impossible to determine and
         without proving special damages or irreparable injury, enjoining and
         restricting the breach or threatened breach. If the Employer succeeds
         in securing any such relief, Executive will pay all of the costs and
         expenses, including reasonable attorneys' fees, that the Employer
         incurs in obtaining such relief.
 
         10.      NOTICES. Any and all notices required in connection with this
Agreement shall be deemed adequately given only if in writing and (a) personally
delivered, or sent by first class, registered, or certified mail, postage
prepaid, return receipt requested or by recognized overnight courier, (b) sent
by facsimile, provided a hard copy is mailed on that date to the party for whom
such notices are intended, or (c) sent by other means at least as fast and
reliable as first class mail. A written notice shall be deemed to have been
given to the recipient party on the earlier of (a) the date it shall be
delivered to the addressrequired by this Agreement; (b) the date delivery shall have been refused at the
address required by this Agreement; (c) with respect to notices sent by mail or
overnight courier, the date as of which the Postal Service or overnight courier,
as the case may be, shall have indicated such notice to be undeliverable at the
address required by this Agreement; or (d) with respect to a facsimile, the date
on which the facsimile is sent and receipt of which is confirmed. Any and all
notices referred to in this Agreement, or which either party desires to give to
the other, shall be addressed to his residence in the case of the Executive, or
to its principal office in the case of the Employer.
 
         11.      WAIVER OF BREACH. A waiver by the Employer of a breach of any
provision of this Agreement by the Executive shall not operate or be construed
as a waiver or estoppel of any subsequent breach by the Executive. No waiver
shall be valid unless in writing and signed by an authorized officer of the
Employer.
 
         12.      ASSIGNMENT. The Executive acknowledges that the services to be
rendered by him are unique and personal. Accordingly, the Executive may not
assign any of his rights or delegate any of his duties or obligations under this
Agreement. The rights and obligations of the Employer under this Agreement shall
inure to the benefit and shall be binding upon the successors and assigns of the
Employer. Employer covenants and agrees that it will secure the assumption by or
the agreement of any successor or assignee of this Agreement to the terms
hereof.
 
         13.      ENTIRE AGREEMENT. This Agreement sets forth the entire and
final agreement and understanding of the parties and contains all of the
agreements made between the parties with respect to the subject matter hereof.
This Agreement supersedes any and all other agreements, either oral or in
writing, between the parties hereto, with respect to the subject matter hereof;
provided, however, that this Agreement does not supersede any stock option or
other equity grants provided to the Executive under the terms of any stock
option or long-term incentive program or agreement. No change or modification of
this Agreement shall be valid unless in writing and signed by the Employer and
the Executive. If any provision of this Agreement shall be found invalid or
unenforceable for any reason, in whole or in part, then such provision shall be
deemed modified, restricted, or reformulated to the extent and in the manner
necessary to render the same valid and enforceable, or shall be deemed excised
from this Agreement, as the case may require, and this Agreement shall be
construed and enforced to the maximum extent permitted by law, as if such
provision had been originally incorporated herein as so modified, restricted, or
reformulated or as if such provision had not been originally incorporated
herein, as the case may be. The parties further agree to seek a lawful
substitute for any provision found to be unlawful; provided, that, if the
parties are unable to agree upon a lawful substitute, the parties desire and
request that a court or other authority called upon to decide the enforceability
of this Agreement modify those restrictions in this Agreement that, once
modified, will result in an agreement that is enforceable to the maximum extent
permitted by the law in existence at the time of the requested enforcement.
 
         14.      HEADINGS. The headings in this Agreement are inserted for
convenience only and are not to be considered a construction of the provisions
hereof.
 
         15.      EXECUTION OF AGREEMENT. This Agreement may be executed in
several counterparts, each of which shall be considered an original, but which
when taken together, shall constitute one agreement.
 
         16.      GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, without
reference to its conflict of law provisions.
 
 
 
         17.      LITIGATION EXPENSES. In the event Executive brings an action
seeking to enforce his rights under this Agreement, the Employer will pay, on a
regular and current basis, all of Executive's legal fees and expenses incurred
in connection with such action. Executive will be obligated to return all
amounts so advanced only in the event of a final judgment or arbitration
determination denying in full Executive's requested relief.
 
         18.      INDEMNIFICATION. During and after the term hereof, Executive
shall be entitled to indemnification by Employer from and against any loss, cost
or expense incurred by Executive in connection with any threatened, pending or
completed action, suit or proceeding, by reason of the fact that Executive is or
was the President and Chief Executive Officer of Employer to the fullest extent
permitted under applicable law. Executive shall be entitled to advancement of
expenses to the fullest extent permitted under applicable law.
 
 
 
               IN WITNESS WHEREOF, the parties have set their signatures on the
date first written above.
 
 
 
HOLLINGER INTERNATIONAL INC.
a Delaware corporation
 
 
 
By:  /s/ James R. Van Horn                      /s/ Gordon A. Paris
     --------------------------------           ------------------------------
Its: VP, General Counsel & Secretary            Gordon A. Paris
 
 
 
 
 
 
                                       9
 
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</DOCUMENT>