In March of this year, we announced a new structure for three of our functional operating areas: Marketing, Manufacturing and

Reader Sales & Service. Today we are taking the next steps and announcing a new structure for the rest of our functional areas. This represents the most significant changes we have made toward redesigning our company. We have come to these decisions based on our audiences’ behaviours and meaningful discussions with our advertisers. Our employee survey results reflect your concerns that the incomplete transition of our company, and associated uncertainty, has had an effect on the engagement of our teams. This company evolved from many different companies for different readers and advertisers using different tools and different technologies to produce different products. We stayed somewhat resistant to change for a long time because things were so good for so long. This industry felt unshakable – until it wasn’t. Some may wonder what has taken us so long. But this much change takes careful consideration, planning and timing. In spite of that it may feel we’ve gone too far and too fast. The leadership of our company believes these changes are the right changes to strengthen the operations of our business and allow for the acceleration of our strategy.

The functional reporting changes we are announcing today include the following: All content development and editorial functions across the organization will now report directly into Lou Clancy, Senior Vice President, Content. This will allow us to accelerate our efforts to centralize our non-local content production and allows the editors in our newspapers to focus resources on the exceptional hyper-local content that our audiences expect from their favourite newspaper brands. We are creating one integrated sales organization and centralizing the reporting of all of our sales operations – PIA, Local Sales, Digital and 3i and creating a senior group of sales leaders led by Brandon Grosvenor, Senior Vice President, Advertising Sales. This integrated sales leadership team is comprised of Yuri Machado, Kim Campbell and Stephane Le Gal. All digital functions will report into Wendy Desmarteaux, Senior Vice President, Transformation & Digital. This will allow us to accelerate product development, foster greater collaboration and allocate resources to projects from all our digital experts, across the organization. All Human Resources functions will report into Michelle Hall, Executive Vice President, Human Resources. This will allow for greater consistency in employee programming, performance management and hiring practices. All finance functions will report into Doug Lamb, Executive Vice President and Chief Financial Officer. This will allow for more standardized reporting, budgeting and make all of our financial processes, from accounts payable to internal forecasting, easier and more aligned. We have appointed Gerry Nott to the role of Senior Vice President, Eastern Region with responsibility for transformation initiatives at The Gazette, the Ottawa Citizen, The Windsor Star and National Post. Alan Allnutt has been appointed Senior Vice President, Prairie Region with responsibility for transformation initiatives at The StarPhoenix, the Leader-Post, the Edmonton Journal and the Calgary Herald. Earlier this year we appointed Gordon Fisher, President, Pacific Newspaper Group and Gord continues in this role focused on the unique challenges faced in our Vancouver operations. These changes transform the way we run our newspaper operations. What we have created is a functional reporting structure where specialized areas each report into one senior leader rather than duplicating so many efforts at each of our ten newspapers. What this also means is that some roles have been eliminated. We will no longer have publishers at our newspapers. Our three regional leaders: Gord Fisher, Gerry Nott and Alan Allnutt will focus on facilitating the transition from local silos to the new functional reporting structure and build local collaboration infrastructure within each of our three regions. Part of what makes this type of change so hard is saying goodbye to colleagues and friends. Marty Klyne, publisher of the LeaderPost and The StarPhoenix, Guy Huntingford, publisher of the Calgary Herald and John Connolly, publisher of the Edmonton Journal will be leaving the organization. Bill Neill, who was instrumental in our national sales efforts, will be leaving the organization as well. Each have made great contributions and we wish them the very best in their future endeavours. Marty Beneteau continues as Editor-in-Chief at The Windsor Star.

We know that this represents a lot of information and change. In the coming days and weeks you can expect to see our functional leaders at your operations as we work to make this as smooth and effective of a transformation as possible. I believe, and our senior leaders believe, that this company is uniquely positioned to benefit from our size and regional diversity. With a redesigned structure, that puts focus on where we need to go as an organization and a roadmap for how we can get there, we will be even stronger and better poised for success.

Paul

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