Exhibit 10.5
FIRST AMENDMENT TO
EMPLOYMENT AGREEMENT
          THIS FIRST AMENDMENT, by and between Dolan Media Company, a Delaware
corporation (the “Company”); and James P. Dolan (“Executive”), is entered into
on this 29th day of December 2008, but effective as of the applicable dates set
forth below.
PRELIMINARY RECITALS
          A. Employment Agreement. The Company and Executive have entered into a
written Employment Agreement (the “Employment Agreement”), dated as of April 1,
2007 (the “Original Effective Date”), which remains in effect. Since then,
Executive has continued to serve as Chief Executive Officer and President of the
Company, pursuant to the Employment Agreement; and Executive is also currently
serving as Chairman of the Board of Directors of the Company. Any capitalized
terms used in this Amendment, and not defined herein, shall have the meanings
specified in the Employment Agreement.
          B. Purpose of Amendment. The Company and Executive desire to minimize
the risk to Executive of premature income taxation and unnecessary penalties
under Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), by amending certain provisions of the Employment Agreement to comply
with Section 409A of the Code or applicable guidance or regulations thereunder.
AMENDMENT
          NOW, THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree to amend the Employment Agreement as
follows:
          1. As of the Original Effective Date, the last sentence of Section 2.2
is hereby amended to read as follows:
The Annual Bonus for a fiscal year shall be paid to Executive in a cash lump sum
in accordance with the terms of the Company’s annual bonus plan, but in any
event shall be paid within two and one-half months after such fiscal year.
          2. As of the Original Effective Date, the definition of “Good Reason”
in Section 3.1(b) is hereby amended to read as follows:
“Good Reason” means the occurrence, without Executive’s express written consent,
of any of the following events; provided, however, that Executive gives the
Company written notice of circumstances giving rise to any of the following
events no later than ninety (90) days after the date that such circumstances
come into existence; and provided further that any termination of Executive’s
employment for Good Reason, as a result of any such event or condition that is
not timely cured, must occur no later than the second anniversary of the date
that such event occurs: (i) the Company moves its principal offices from the
Minneapolis-St. Paul metropolitan area and requires Executive to relocate to the
vicinity of such new offices; (ii) the Company removes Executive as the
Company’s Chief Executive Officer or otherwise substantially diminishes
Executive’s duties or responsibilities with respect to the Company; (iii) the
Company breaches any of its obligations hereunder,

1

--------------------------------------------------------------------------------

 

which breach remains uncured thirty (30) days after receipt by the Company of
written notice of such breach; (iv) a material diminution in Executive’s Base
Salary or the target amount of any Annual Bonus, or a material diminution in
Benefits available to Executive on the Effective Date or as hereafter may be
made available to Executive, other than, in each case under this clause (iv):
(x) any such diminution that is cured within thirty (30) days after receipt by
the Company of written notice of such diminution, or (y) any diminution of
Benefits that also applies to the other senior executives of the Company.
          3. As of the Original Effective Date, the last sentence of
Section 3.2(b) (concerning certain payments due after termination of Executive’s
employment by the Company without Cause or by Executive with Good Reason) is
hereby deleted and replaced by three sentences reading as follows:
If the Company does not execute and deliver any such release to Executive at
least sixty (60) days before the end of the six (6) month period following
Executive’s Separation from Service, the Company shall be deemed to have elected
not to require Executive’s execution of such a release. If the Company shall
have timely executed and delivered such a release to Executive, and Executive
either fails to execute and deliver the release to the Company at least thirty
(30) days before the end of that six (6) month period, or he does so but
rescinds such release before any payment is otherwise due under
Section 3.2(b)(iii) or Section 3.2(b)(iv), the Company shall have no obligations
under Sections 3.2(b)(iii) and (iv). Except for the Company’s obligations, if
any, under this Section 3.2(b) and as otherwise provided in Section 3.3, the
Company shall have no further obligations hereunder, including under Section 2,
or otherwise with respect to Executive’s employment, from and after the
termination date.
          4. Except as expressly amended in this First Amendment, the Employment
Agreement shall remain in full force and effect according to its terms.
          IN WITNESS WHEREOF, the undersigned Executive and the Company have
executed this Amendment on the date first stated above, but effective
retroactively as of the applicable effective dates stated above.

         
 
  COMPANY:    
 
       
 
  DOLAN MEDIA COMPANY    
 
       
 
  /s/ Scott J. Pollei    
 
       
 
  By: Scott J. Pollei, Executive Vice    
 
  President and Chief Financial Officer    
 
       
 
  /s/ John Bergstrom    
 
       
 
  By: John Bergstrom, Chairman of the    
 
  Compensation Committee    
 
       
 
  EXECUTIVE:    
 
       
 
  /s/ James P. Dolan    
 
       
 
  James P. Dolan    

2