868512--3/12/2008--SUN-TIMES_MEDIA_GROUP

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{investment, property, distribution}

{financial, litigation, operation}

{stock, price, operating}

{cost, operation, labor}

{condition, economic, financial}

{product, market, service}

{tax, income, asset}

{debt, indebtedness, cash}

{control, financial, internal}

{system, service, information}

{loan, real, estate}

Risks Relating to the Company s Business and the Industry The Company has substantial potential tax liabilities. Competition in the newspaper industry originates from many sources. The advent of new technologies and industry practices, such as the provision of newspaper content on free Internet sites, may continue to result in decreased advertising and circulation revenue. The Company s revenue is dependent upon economic conditions in the Company s target markets and is seasonal. The Company s publications have experienced declines in circulation in the past and may do so in the future. The Company has implemented a reorganization strategy that may not result in profitability. The Company may not be able to realize the value of certain investments at their carrying value. The Company s senior management team is required to devote significant attention to matters arising from the evaluation of strategic alternatives. The outsourcing of significant business processes may expose the Company to significant financial and customer service risk. Sun-Times Media Group, Inc. is a holding company and relies on its subsidiaries to meet its financial obligations. The Company s internal control over financial reporting is not effective as of December 31, 2007 and weaknesses in the Company s internal controls and procedures could have a material adverse effect on the Company. The Company may experience labor disputes, which could slow down or halt production or distribution of the Company s newspapers or other publications. Newsprint represents the Company s single largest raw material expense and changes in the price of newsprint could affect net income. All of the Company s operations are concentrated in one geographic area. Risks Relating to Control and Improper Conduct by Controlling Stockholder The Company s controlling stockholder may cause actions to be taken that might not be in the best interests of the Company s other stockholders. The Company may face interference by its controlling stockholder that will prevent it from recovering on its claims. The results of ongoing SEC investigations may have a material adverse effect on the Company s business and results of operations. Pending litigation could have a material adverse effect on the Company. There could be a change of control of the Company through a change in control of Hollinger Inc. under circumstances not approved by the independent directors of the Company. The Company is a party to a Business Opportunities Agreement with Hollinger Inc., the terms of which limit the Company s ability to pursue certain business opportunities in certain countries. Hollinger Inc. sought protection from its creditors through insolvency proceedings which may result in a change of control or other adverse impacts on the Company.

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868512--3/12/2008--SUN-TIMES_MEDIA_GROUP_INC