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UNITEDSTATESSECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C.20549

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FORM10-Q

(Mark One)

|        |                                                                                        |
|--------|----------------------------------------------------------------------------------------|
|   | QUARTERLYREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934. |

For the quarterly period ended June25,2006

OR

|        |                                                                                         |
|--------|-----------------------------------------------------------------------------------------|
|   | TRANSITION REPORTPURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934. |

For the transition period from                         to                        

Commission File Number: 1-12955

JournalRegister Company

(Exact Name ofRegistrant as Specified in itsCharter)

|                                              |  |  |                    |
|----------------------------------------------|--|--|--------------------|
| Delaware                                     |  |  | 22-3498615         |
| (Stateor Other Jurisdictionof                |  |  | (I.R.S.Employer    |
| IncorporationorOrganization)                 |  |  | IdentificationNo.) |
| 790 Township LineRoad, Suite 300, Yardley,PA |  |  | 19067              |
| (Addressof Principal ExecutiveOffices)       |  |  | (ZipCode)          |
|                                              |

(215)504-4200

(Registrant’s TelephoneNumber, Including AreaCode)

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50 West StateStreet, Trenton, New Jersey08608-1298

(Former Address of PrincipleExecutive Offices)

Indicate by check mark whether the registrant:(1) has filed all reports required 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 filesuch reports), and (2) has been subject to such filing requirements forthe past 90 days.     Yes       No   

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

Large acceleratedfiler           Acceleratedfiler           Non-acceleratedfiler   

Indicate by check mark whether the registrantis a shell company (as defined in Rule 12b-2 of the ExchangeAct).    Yes       No   

Indicate thenumber of shares outstanding of each of the issuer’s classes ofcommon stock, as of the latest practicable date: common stock, $.01 parvalue per share, 39,182,632 shares outstanding (exclusive of treasuryshares) as of July  28,2006.

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Table of Contents

JOURNALREGISTER COMPANY

INDEX TO FORM10-Q

|             |  |  |                                                                                          |  |  |         |
|-------------|--|--|------------------------------------------------------------------------------------------|--|--|---------|
| PARTI.      |  |  | FINANCIAL INFORMATION                                                                    |  |  | PageNo. |
| Item 1.     |  |  | FinancialStatements (Unaudited):                                                         |  |  |    |
|        |  |  | CondensedConsolidated BalanceSheets                                                      |  |  | 1       |
|        |  |  | CondensedConsolidated Statements ofIncome                                                |  |  | 2       |
|        |  |  | Condensed ConsolidatedStatements of Cash Flows                                           |  |  | 3       |
|        |  |  | Notes toCondensed Consolidated FinancialStatements                                       |  |  | 4       |
| Item2.      |  |  | Management’s Discussion and Analysis of FinancialCondition andResults ofOperations |  |  | 15      |
| Item3.      |  |  | Quantitative and Qualitative Disclosures About MarketRisk                                |  |  | 25      |
| Item 4.     |  |  | Controls andProcedures                                                                   |  |  | 25      |
| PARTII.     |  |  | OTHERINFORMATION                                                                         |  |  |    |
| Item1A      |  |  | Risk Factors                                                                             |  |  | 26      |
| Item2.      |  |  | Unregistered Sales of Equity Securities and Use ofProceeds                               |  |  | 26      |
| Item4.      |  |  | Submission of Matters to a Vote of SecurityHolders                                       |  |  | 27      |
| Item6.      |  |  | Exhibits                                                                                 |  |  | 28      |
| Signature   |  |  | 29                                                                                       |
| Exhibit31.1 |  |  | Certification of Chairman and Chief ExecutiveOfficer                                     |  |  |    |
| Exhibit31.2 |  |  | Certification of Chief FinancialOfficer                                                  |  |  |    |
| Exhibit32   |  |  | Certifications required under Section 906 of theSarbanes-Oxley Act of2002                |  |  |    |
|             |

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Table of Contents

PARTI.    FINANCIAL INFORMATION

Item1.    Financial Statements

JOURNAL REGISTERCOMPANYCONDENSED CONSOLIDATED BALANCESHEETS(Unaudited)

|                                                                                                                                                                                                         |  |  |         |   |           |             |  |  |  |   |           |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--|--|---------|---|-----------|-------------|--|--|--|---|-----------|---|
| Inthousands, except for sharedata                                                                                                                                                                       |  |  | June25, |   |           | December25, |
| Asof:                                                                                                                                                                                                   |  |  | 2006    |   |           | 2005        |
| ASSETS:                                                                                                                                                                                                 |  |  |         |   |      |             |  |  |  |   |      |   |
| Currentassets:                                                                                                                                                                                          |  |  |         |   |      |             |  |  |  |   |      |   |
| Cash and cashequivalents                                                                                                                                                                                |  |  |         | $ | 2,977     |             |  |  |  | $ | 2,410     |   |
| Accountsreceivable, less allowance for doubtful accounts of $7,620 and $7,937,respectively                                                                                                              |  |  |         |   | 60,727    |             |  |  |  |   | 61,203    |   |
| Inventories                                                                                                                                                                                             |  |  |         |   | 8,785     |             |  |  |  |   | 8,736     |   |
| Deferredincometaxes                                                                                                                                                                                     |  |  |         |   | 10,486    |             |  |  |  |   | 10,588    |   |
| Othercurrentassets                                                                                                                                                                                      |  |  |         |   | 8,041     |             |  |  |  |   | 7,375     |   |
| Totalcurrentassets                                                                                                                                                                                      |  |  |         |   | 91,016    |             |  |  |  |   | 90,312    |   |
| Property,plant andequipment:                                                                                                                                                                            |  |  |         |   |      |             |  |  |  |   |      |   |
| Land                                                                                                                                                                                                    |  |  |         |   | 14,386    |             |  |  |  |   | 14,386    |   |
| Buildingsandimprovements                                                                                                                                                                                |  |  |         |   | 99,974    |             |  |  |  |   | 97,800    |   |
| Machineryandequipment                                                                                                                                                                                   |  |  |         |   | 193,885   |             |  |  |  |   | 187,195   |   |
| Constructioninprogress                                                                                                                                                                                  |  |  |         |   | 7,109     |             |  |  |  |   | 6,731     |   |
| Totalproperty, plant andequipment                                                                                                                                                                       |  |  |         |   | 315,354   |             |  |  |  |   | 306,112   |   |
| Lessaccumulateddepreciation                                                                                                                                                                             |  |  |         |   | (157,683  | )           |  |  |  |   | (150,225  | ) |
| Netproperty, plant andequipment                                                                                                                                                                         |  |  |         |   | 157,671   |             |  |  |  |   | 155,887   |   |
| Intangibleand otherassets:                                                                                                                                                                              |  |  |         |   |      |             |  |  |  |   |      |   |
| Goodwill                                                                                                                                                                                                |  |  |         |   | 782,503   |             |  |  |  |   | 779,581   |   |
| Otherintangible assets, net of accumulated amortization of $11,302 and$11,936,respectively                                                                                                              |  |  |         |   | 146,894   |             |  |  |  |   | 151,553   |   |
| Fairmarket value ofhedges                                                                                                                                                                               |  |  |         |   | 16,179    |             |  |  |  |   | 7,189     |   |
| Otherassets                                                                                                                                                                                             |  |  |         |   | 3,495     |             |  |  |  |   | 3,367     |   |
| Totalassets                                                                                                                                                                                             |  |  |         | $ | 1,197,758 |             |  |  |  | $ | 1,187,889 |   |
| LIABILITIESAND STOCKHOLDERS’EQUITY:                                                                                                                                                               |  |  |         |   |      |             |  |  |  |   |      |   |
| Currentliabilities:                                                                                                                                                                                     |  |  |         |   |      |             |  |  |  |   |      |   |
| Dividendspayable                                                                                                                                                                                        |  |  |         | $ | 797       |             |  |  |  | $ | 809       |   |
| Currentmaturities of seniordebt                                                                                                                                                                         |  |  |         |   | 15,000    |             |  |  |  |   | 7,500     |   |
| Accountspayable                                                                                                                                                                                         |  |  |         |   | 19,353    |             |  |  |  |   | 19,369    |   |
| Accruedinterest                                                                                                                                                                                         |  |  |         |   | 6,903     |             |  |  |  |   | 6,603     |   |
| Deferredsubscriptionrevenue                                                                                                                                                                             |  |  |         |   | 14,890    |             |  |  |  |   | 14,664    |   |
| Accruedsalaries andvacation                                                                                                                                                                             |  |  |         |   | 10,207    |             |  |  |  |   | 10,704    |   |
| Otheraccrued expenses and currentliabilities                                                                                                                                                            |  |  |         |   | 23,976    |             |  |  |  |   | 20,876    |   |
| Totalcurrentliabilities                                                                                                                                                                                 |  |  |         |   | 91,126    |             |  |  |  |   | 80,525    |   |
| Seniordebt                                                                                                                                                                                              |  |  |         |   | 727,800   |             |  |  |  |   | 740,700   |   |
| Capital leaseobligations, net of currentmaturities                                                                                                                                                      |  |  |         |   | 3,468     |             |  |  |  |   | 3,628     |   |
| Deferredincome taxes                                                                                                                                                                                    |  |  |         |   | 112,721   |             |  |  |  |   | 103,127   |   |
| Accruedretiree benefits and otherliabilities                                                                                                                                                            |  |  |         |   | 20,733    |             |  |  |  |   | 20,259    |   |
| Incometaxespayable                                                                                                                                                                                      |  |  |         |   | 17,652    |             |  |  |  |   | 17,608    |   |
| Commitmentsandcontingencies                                                                                                                                                                             |  |  |         |   |      |             |  |  |  |   |      |   |
| Stockholders’equity:                                                                                                                                                                              |  |  |         |   |      |             |  |  |  |   |      |   |
| Preferredstock, $.01 par value per share, 1,000,000 shares authorized, noneissued and outstanding at June  25,  2006 andDecember  25,2005                                                               |  |  |         |   | —   |             |  |  |  |   | —   |   |
| Commonstock, $.01 par value per share, 300,000,000 shares authorized,48,437,581 issued and 39,246,436 outstanding at June  25,2006 and 48,437,581 issued and 40,385,525 outstanding atDecember  25,2005 |  |  |         |   | 484       |             |  |  |  |   | 484       |   |
| Additionalpaid-incapital                                                                                                                                                                                |  |  |         |   | 362,254   |             |  |  |  |   | 361,421   |   |
| Retainedearnings (accumulated deficit)                                                                                                                                                                  |  |  |         |   | 4,264     |             |  |  |  |   | (5,680    | ) |
|                                                                                                                                                                                                    |  |  |         |   | 367,002   |             |  |  |  |   | 356,225   |   |
| Lesstreasury stock                                                                                                                                                                                      |  |  |         |   |      |             |  |  |  |   |      |   |
| 9,191,145shares and 8,052,056 shares, respectively, atcost                                                                                                                                              |  |  |         |   | (135,827  | )           |  |  |  |   | (121,953  | ) |
| Accumulatedother comprehensive loss, net of tax                                                                                                                                                         |  |  |         |   | (6,917    | )           |  |  |  |   | (12,230   | ) |
| Stockholders’equity                                                                                                                                                                               |  |  |         |   | 224,258   |             |  |  |  |   | 222,042   |   |
| Totalliabilities and stockholders’equity                                                                                                                                                          |  |  |         | $ | 1,197,758 |             |  |  |  | $ | 1,187,889 |   |
|                                                                                                                                                                                                         |

Seeaccompanying notes to condensed consolidated financialstatements.

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JOURNAL REGISTERCOMPANYCONDENSED CONSOLIDATED STATEMENTS OFINCOME(Unaudited)

|                                                      |  |  |                     |   |         |                       |  |  |              |   |         |                |  |  |  |   |         |   |  |  |  |   |         |   |
|------------------------------------------------------|--|--|---------------------|---|---------|-----------------------|--|--|--------------|---|---------|----------------|--|--|--|---|---------|---|--|--|--|---|---------|---|
|                                                 |  |  | Thirteenweeks ended |   |         | Twenty-six weeksended |
| Inthousands, except per share dataFiscal periodended |  |  | June 25,2006        |   |         | June26,2005(1)        |  |  | June 25,2006 |   |         | June26,2005(1) |
| Revenues:                                            |  |  |                     |   |    |                       |  |  |              |   |    |                |  |  |  |   |    |   |  |  |  |   |    |   |
| Advertising                                          |  |  |                     | $ | 111,896 |                       |  |  |              | $ | 115,011 |                |  |  |  | $ | 211,841 |   |  |  |  | $ | 217,251 |   |
| Circulation                                          |  |  |                     |   | 25,148  |                       |  |  |              |   | 25,992  |                |  |  |  |   | 50,292  |   |  |  |  |   | 51,689  |   |
| Newspaperrevenues                                    |  |  |                     |   | 137,044 |                       |  |  |              |   | 141,003 |                |  |  |  |   | 262,133 |   |  |  |  |   | 268,940 |   |
| Commercialprinting and other                         |  |  |                     |   | 5,121   |                       |  |  |              |   | 4,872   |                |  |  |  |   | 9,622   |   |  |  |  |   | 9,471   |   |
| Totalrevenues                                        |  |  |                     |   | 142,165 |                       |  |  |              |   | 145,875 |                |  |  |  |   | 271,755 |   |  |  |  |   | 278,411 |   |
| Operatingexpenses:                                   |  |  |                     |   |    |                       |  |  |              |   |    |                |  |  |  |   |    |   |  |  |  |   |    |   |
| Salariesand employeebenefits                         |  |  |                     |   | 58,416  |                       |  |  |              |   | 55,385  |                |  |  |  |   | 113,727 |   |  |  |  |   | 111,342 |   |
| Newsprint,ink and printing charges                   |  |  |                     |   | 13,253  |                       |  |  |              |   | 12,956  |                |  |  |  |   | 25,501  |   |  |  |  |   | 24,370  |   |
| Selling,general andadministrative                    |  |  |                     |   | 20,281  |                       |  |  |              |   | 19,602  |                |  |  |  |   | 40,143  |   |  |  |  |   | 41,284  |   |
| Depreciationandamortization                          |  |  |                     |   | 4,781   |                       |  |  |              |   | 4,742   |                |  |  |  |   | 9,422   |   |  |  |  |   | 9,608   |   |
| Other                                                |  |  |                     |   | 18,674  |                       |  |  |              |   | 18,160  |                |  |  |  |   | 36,417  |   |  |  |  |   | 35,578  |   |
| Totaloperatingexpenses                               |  |  |                     |   | 115,405 |                       |  |  |              |   | 110,845 |                |  |  |  |   | 225,210 |   |  |  |  |   | 222,182 |   |
| Operatingincome                                      |  |  |                     |   | 26,760  |                       |  |  |              |   | 35,030  |                |  |  |  |   | 46,545  |   |  |  |  |   | 56,229  |   |
| Netinterest expense andother                         |  |  |                     |   | (10,664 | )                     |  |  |              |   | (9,722  | )              |  |  |  |   | (21,881 | ) |  |  |  |   | (18,587 | ) |
| Write-offof debt issuancecosts                       |  |  |                     |   | — |                       |  |  |              |   | — |                |  |  |  |   | (5,662  | ) |  |  |  |   | — |   |
| Incomebefore provision for income taxes              |  |  |                     |   | 16,096  |                       |  |  |              |   | 25,308  |                |  |  |  |   | 19,002  |   |  |  |  |   | 37,642  |   |
| Provisionfor income taxes                            |  |  |                     |   | 6,318   |                       |  |  |              |   | 9,936   |                |  |  |  |   | 7,459   |   |  |  |  |   | 14,771  |   |
| Netincome                                            |  |  |                     | $ | 9,778   |                       |  |  |              | $ | 15,372  |                |  |  |  | $ | 11,543  |   |  |  |  | $ | 22,871  |   |
| Netincome per commonshare:                           |  |  |                     |   |    |                       |  |  |              |   |    |                |  |  |  |   |    |   |  |  |  |   |    |   |
| Basic                                                |  |  |                     | $ | 0.25    |                       |  |  |              | $ | 0.37    |                |  |  |  | $ | 0.29    |   |  |  |  | $ | 0.55    |   |
| Diluted                                              |  |  |                     | $ | 0.25    |                       |  |  |              | $ | 0.37    |                |  |  |  | $ | 0.29    |   |  |  |  | $ | 0.54    |   |
| Dividendsper commonshare                             |  |  |                     | $ | 0.02    |                       |  |  |              | $ | — |                |  |  |  | $ | 0.04    |   |  |  |  | $ | — |   |
| Weighted-averagesharesoutstanding:                   |  |  |                     |   |    |                       |  |  |              |   |    |                |  |  |  |   |    |   |  |  |  |   |    |   |
| Basic                                                |  |  |                     |   | 39,497  |                       |  |  |              |   | 41,717  |                |  |  |  |   | 39,837  |   |  |  |  |   | 41,867  |   |
| Diluted                                              |  |  |                     |   | 39,530  |                       |  |  |              |   | 41,943  |                |  |  |  |   | 39,860  |   |  |  |  |   | 42,179  |   |
|                                                      |

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|-----|----------------------------------------------------------------------------|
| (1) | Containsreclassifications in order to conform to current yearpresentation. |

See accompanying notes tocondensed consolidated financialstatements.

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JOURNAL REGISTERCOMPANYCONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS(Unaudited)

|                                                                                 |  |  |                      |   |          |                 |  |  |  |   |         |   |
|---------------------------------------------------------------------------------|--|--|----------------------|---|----------|-----------------|--|--|--|---|---------|---|
| Inthousands                                                                     |  |  | Twenty-sixweeksended |
| Fiscalperiod ended                                                              |  |  | June 25, 2006        |   |          | June 26,2005(1) |
| Cash flows fromoperating activities:                                            |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Netincome                                                                       |  |  |                      | $ | 11,543   |                 |  |  |  | $ | 22,871  |   |
| Adjustmentsto reconcile net income to net cash provided by operatingactivities: |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Provision for losseson accountsreceivable                                       |  |  |                      |   | 1,840    |                 |  |  |  |   | 2,456   |   |
| Depreciationandamortization                                                     |  |  |                      |   | 9,422    |                 |  |  |  |   | 9,608   |   |
| Write-offof debt issuancecosts                                                  |  |  |                      |   | 5,662    |                 |  |  |  |   | — |   |
| Non-cashinterest expense                                                        |  |  |                      |   | 520      |                 |  |  |  |   | 744     |   |
| Non-cashstock compensationexpense                                               |  |  |                      |   | 833      |                 |  |  |  |   | 529     |   |
| Increase in deferredincome taxes                                                |  |  |                      |   | 9,696    |                 |  |  |  |   | 10,264  |   |
| Decreasein accountsreceivable                                                   |  |  |                      |   | (1,364   | )               |  |  |  |   | (543    | ) |
| Increase inaccounts payable                                                     |  |  |                      |   | (16      | )               |  |  |  |   | (2,475  | ) |
| Other,net                                                                       |  |  |                      |   | (805     | )               |  |  |  |   | (2,985  | ) |
| Netcash provided by operatingactivities                                         |  |  |                      |   | 37,331   |                 |  |  |  |   | 40,469  |   |
| Cashflows from investingactivities:                                             |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Net additions toproperty, plant andequipment                                    |  |  |                      |   | (10,495  | )               |  |  |  |   | (4,216  | ) |
| Netproceeds from sale ofequipment                                               |  |  |                      |   | 140      |                 |  |  |  |   | — |   |
| Purchases ofbusiness, net of cashacquired                                       |  |  |                      |   | (2,917   | )               |  |  |  |   | — |   |
| Netcash used in investingactivities                                             |  |  |                      |   | (13,272  | )               |  |  |  |   | (4,216  | ) |
| Cashflows from financingactivities:                                             |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Proceeds fromissuance of long-termdebt                                          |  |  |                      |   | 755,500  |                 |  |  |  |   | — |   |
| Extinguishmentof prior long-termdebt                                            |  |  |                      |   | (755,500 | )               |  |  |  |   | — |   |
| Debtissuance fees                                                               |  |  |                      |   | (2,463   | )               |  |  |  |   | — |   |
| Netrepayments of long-term debt                                                 |  |  |                      |   | (5,400   | )               |  |  |  |   | (22,500 | ) |
| Dividendspaid                                                                   |  |  |                      |   | (1,599   | )               |  |  |  |   | — |   |
| Payments ofcapital leaseobligations                                             |  |  |                      |   | (156     | )               |  |  |  |   | (114    | ) |
| Exercise ofstock options for commonstock                                        |  |  |                      |   | —  |                 |  |  |  |   | 54      |   |
| Purchase ofCompanystock                                                         |  |  |                      |   | (13,874  | )               |  |  |  |   | (12,438 | ) |
| Netcash used in financingactivities                                             |  |  |                      |   | (23,492  | )               |  |  |  |   | (34,998 | ) |
| Increasein cash and cashequivalents                                             |  |  |                      |   | 567      |                 |  |  |  |   | 1,255   |   |
| Cash and cashequivalents, beginning ofperiod                                    |  |  |                      |   | 2,410    |                 |  |  |  |   | 2,003   |   |
| Cashand cash equivalents, end ofperiod                                          |  |  |                      | $ | 2,977    |                 |  |  |  | $ | 3,258   |   |
| Supplementaldisclosures of cash flowinformation:                                |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Cashpaid during the periodfor:                                                  |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Interest                                                                        |  |  |                      | $ | 21,179   |                 |  |  |  | $ | 14,996  |   |
| Incometaxes                                                                     |  |  |                      | $ | 3,123    |                 |  |  |  | $ | 5,476   |   |
| Supplementaldisclosures of non-cashactivities:                                  |  |  |                      |   |     |                 |  |  |  |   |    |   |
| Comprehensiveincome (loss) – mark-to-market hedge adjustments, net oftax  |  |  |                      | $ | 5,313    |                 |  |  |  | $ | (487    | ) |
|                                                                                 |

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|     |                                                                            |
|-----|----------------------------------------------------------------------------|
| (1) | Containsreclassifications in order to conform to current yearpresentation. |

See accompanying notes to condensedconsolidated financialstatements.

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

1.    Organizationand Basis of Presentation

The accompanying consolidatedfinancial statements include Journal Register Company and all of itswholly-owned subsidiaries (the‘‘Company’’). The Company primarilypublishes daily and non-daily newspapers in print and online servingmarkets in the Greater Philadelphia area, Michigan, Connecticut, theGreater Cleveland area, Upper New England, and the Capital-Saratoga andMid-Hudson regions of New York. The Company owns and manages commercialprinting operations in Connecticut and Pennsylvania. The Company alsoowns JobsInTheUS, a network of premier employment Web sites in theNortheast. The Company was incorporated on March  11,  1997and became a publicly traded company in May of 1997.

The Companyoperates on a 52/53 week fiscal year generally ending on the Sundayclosest to the end of the calendar year. Each quarter is 13/14 weeks,also generally ending on the Sunday closest to the end of the calendarquarter.

The condensed consolidated interim financial statementsincluded herein have been prepared by the Company, without audit, inaccordance with accounting principles generally accepted in the UnitedStates (‘‘GAAP’’) and pursuant to the rulesand regulations of the Securities and Exchange Commission. Thecondensed consolidated interim financial statements do not include allof the information and footnote disclosure required by GAAP forcomplete financial statements. In the opinion of the Company’smanagement, the accompanying unaudited condensed consolidated financialstatements contain all material adjustments (consisting only of normalrecurring accruals) necessary to present fairly its financial positionas of June  25,  2006 and December  25,  2005and the results of its operations and cash flows for the thirteen andtwenty-six week periods ended June  25  2006 andJune  26,  2005. These financial statements should be readin conjunction with the December  25,  2005 auditedConsolidated Financial Statements and Notes thereto filed with theSecurities and Exchange Commission. The interim operating results arenot necessarily indicative of the results to be expected for an entireyear.

2.    Reclassifications

To conform to currentyear presentations, the Company reclassified certain circulationrevenues and expenses related to discounts, promotions and carriercompensation. The impact of the reclass was a decrease in circulationrevenues of $0.9  million and $2.2  million for thethirteen and twenty-six periods ended June  26,  2005,respectively, offset entirely by a decrease in operating expenses ofthe same amounts. The Company also reclassified certain cash balancesof $1.3  million for the period ended June  26,  2005from accounts payable, the effect of which is reflected on itsCondensed Consolidated Statement of CashFlows.

3.    EarningsPer Common Share

The following table sets forth the computationof weighted-average shares outstanding for calculating both basic anddiluted earnings pershare:

|                                        |  |  |                     |  |        |                       |  |  |               |  |        |              |  |  |  |  |        |  |  |  |  |  |        |  |
|----------------------------------------|--|--|---------------------|--|--------|-----------------------|--|--|---------------|--|--------|--------------|--|--|--|--|--------|--|--|--|--|--|--------|--|
|                                   |  |  | Thirteenweeks ended |  |        | Twenty-six weeksended |
|                                   |  |  | June 25,2006        |  |        | June 26, 2005         |  |  | June 25, 2006 |  |        | June 26,2005 |
| Weighted-average shares – basic  |  |  |                     |  | 39,497 |                       |  |  |               |  | 41,717 |              |  |  |  |  | 39,837 |  |  |  |  |  | 41,867 |  |
| Effectof dilutivesecurities:           |  |  |                     |  |   |                       |  |  |               |  |   |              |  |  |  |  |   |  |  |  |  |  |   |  |
| Employeestockoptions                   |  |  |                     |  | 33     |                       |  |  |               |  | 226    |              |  |  |  |  | 23     |  |  |  |  |  | 312    |  |
| Weighted-averageshares – diluted |  |  |                     |  | 39,530 |                       |  |  |               |  | 41,943 |              |  |  |  |  | 39,860 |  |  |  |  |  | 42,179 |  |
|                                        |

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

3.    EarningsPer Common Share (continued)

Options to purchase approximately5.2  million shares of common stock at a range of $14.00 to$22.50 per share were outstanding during the thirteen and twenty-sixweek periods ended June  25,  2006, but were not includedin the computation of diluted earnings per share for such periodbecause the exercise prices were greater than the average market priceof the common shares during such period. Similarly, options to purchase2.4  million shares of common stock at a range of $18.51 to$22.50 were outstanding during the thirteen and twenty-six week periodsended June  26,  2005, but were not included in thecomputation of the diluted earnings per share for such period becausethe exercise prices of those options were greater than the averagemarket price of the common shares during suchperiod.

4.    Acquisitions

TheCompany applies the purchase method of accounting for acquisitions.Acquisitions and dispositions of properties are subject to closingcosts and may be subject to the finalization of customaryadjustments.

On December  6,  2005, theCompany completed the acquisition of the assets of JobsInTheUS, basedin Westbrook, Maine. This acquisition included the online recruitingWeb sites of JobsInTheUS.com, JobsInME.com, JobsInNH.com, JobsInVT.com,JobsInRI.com and other domain names. Founded in 1999, JobsInTheUS isone of the fastest-growing local job Internet sites — both interms of unique visits to the Web sites and jobs posted. The acquiredcompany specializes in state-specific job Internet sites wherequalified candidates who want to work in a particular region find amatch with local employers. The excess of the purchase price over thefair market value of the assets acquired is subject to the Companyfinalizing the valuation of the business acquired and purchase priceallocation.

On March  29,  2006, theCompany completed the acquisition of the assets of the SuburbanLifestyles Community Newspaper Group, (‘‘SuburbanLifestyles’’). Based in Rochester Hills, Michigan,Suburban Lifestyles publications are distributed in many of theaffluent and growing neighborhoods of Oakland and Macomb Counties andfocus on local news and information in each of the communities served.Suburban Lifestyles is being integrated into our MichiganCluster.

Results of operations of the Company’sacquisitions are included in the Company’s results of operationsfrom the dates of their respectiveacquisition.

5.    Debtand Interest Rate Derivatives

On January25,  2006, the Company amended and restated its existing CreditAgreement, dated August  12,  2004, pursuant to an Amendedand Restated Credit Agreement (the ‘‘Amended CreditAgreement’’) with JPMorgan Chase Bank, N.A. asAdministrative Agent, J.P. Morgan Securities Inc. as Sole Lead Arrangerand Sole Bookrunner, SunTrust Bank and Wachovia Bank, N.A. asCo-Syndication Agents and Bank of America, N.A. and The Royal Bank ofScotland PLC as Co-Documentation Agents, and several banks and otherfinancial institutions who became parties thereto as lenders. OnJanuary  25,  2006, the Company borrowed $625million in Term Loan A and $130.5  million in revolving creditloans under the Amended Credit Agreement. These borrowings were used torepay term loans and revolving credit loans outstanding under theformer Credit Agreement, to pay fees and expenses in connection withthe Amended Credit Agreement, and for general corporate purposes. TheAmended Credit Agreement allows the Company to borrow up to anadditional $244.5  million in revolving credit loans, subject tothe terms of the Amended Credit Agreement. In addition, an incrementalloan facility is also made available under the Amended Credit Agreementin the maximum amount of $500  million, subject to the terms andconditions of the agreement. The lenders have no obligation to makeadditional loans to the Company under the incremental loan facility,but may enter into these commitments at their solediscretion.

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

5.    Debtand Interest Rate Derivatives    (continued)

The Amended Credit Agreement is anamendment and restatement of the former Credit Agreement which was ineffect from August  12,  2004 until January25,  2006 and, therefore, contains substantially similar terms asthe former Credit Agreement except that, among other changes and inaddition to the terms described above, the Term Loan B under the formerCredit Agreement was eliminated and the Term Loan A commitment wasincreased by $350  million. The amortization period for the TermLoan A has also been extended. The commitment fee on the currentlyavailable and unused revolving credit loans has been reduced by 0.125percentage points and the interest rates on outstanding loans based onLondon Interbank Offered Rates (LIBOR) have been reduced by 0.25percentage points to 0.50 percentage points, subject to the terms andconditions of the Amended Credit Agreement. The borrowings currentlyoutstanding under the Amended Credit Agreement bear interest based oneither various LIBOR rates (determined daily) plus 1.00 percent or thePrime Rate.

The Amended Credit Agreement provides formandatory prepayments with the proceeds of certain dispositions andcasualty events and with specified percentages of excess cash flow (asthat term is defined in the agreement). In addition, the full amount ofthe borrowings may become immediately due following events of defaultby the Company or its subsidiaries as specified, and the Company mayprepay borrowings without premium or penalty in accordance with theprovisions of the Amended Credit Agreement.

Pursuant tothe terms of the Amended Credit Agreement, the Company will be requiredto maintain specified financial ratios, and will also be subject tospecified operational limitations, including, among others, limitationson its ability to incur additional indebtedness, to make certainfundamental company changes (such as mergers and dispositions ofassets), to authorize dividends and distributions on theCompany’s capital stock, and to undertake certain capitalexpenditures.

The borrowings are fully andunconditionally guaranteed by each of the Company’ssubsidiaries. The Company and its guarantor subsidiaries have pledgedsubstantially all of their assets to secure theborrowings.

The Company will be required to pay down theprincipal amount of the term loan in quarterly installments starting onDecember  29,  2006 and ending with a payment of$340  million on August  12,  2012. Interest andcommitment fees are payable quarterly. The initial availability of$375  million of the Revolving Credit Facility under the AmendedCredit Agreement is available until August  12,  2012. Uponexpiration of the Revolving Credit Facility, the Company is required torepay or refinance the amounts due to the lenders at that time. As ofJune  25,  2006, the maximum availability under theRevolving Credit Facility was $257.2  million, with approximately$108  million available based on the terms and covenants of theAmended Credit Agreement.

The aggregate maturitiespayable as of June  25,  2006 under the refinanced TermLoan A for the following fiscal years are as follows (inthousands):

|      |  |  |  |   |         |  |
|------|--|--|--|---|---------|--|
| 2006 |  |  |  | $ | 7,500   |  |
| 2007 |  |  |  |   | 22,500  |  |
| 2008 |  |  |  |   | 40,000  |  |
| 2009 |  |  |  |   | 50,000  |  |
| 2010 |  |  |  |   | 60,000  |  |
| 2011 |  |  |  |   | 60,000  |  |
| 2012 |  |  |  |   | 385,000 |  |
|      |

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

5.    Debtand Interest Rate Derivatives    (continued)

In connection with this refinancing, theCompany wrote-off $5.7  million of deferred debt issuance costsassociated with the former Credit Agreement. This is reflected as acharge against earnings in the Condensed Consolidated Statements ofIncome and as a non-cash item in the Condensed Consolidated Statementsof Cash Flows for the twenty-six week period ending June25,  2006.

The Company’s long-term debt as ofJune  25,  2006 and December  25,  2005 wascomprised of thefollowing:

|                           |  |  |      |   |         |      |  |  |  |   |         |  |
|---------------------------|--|--|------|---|---------|------|--|--|--|---|---------|--|
| Inthousands               |  |  | 2006 |   |         | 2005 |
| Termloan A                |  |  |      | $ | 625,000 |      |  |  |  | $ | 275,000 |  |
| Term loanB                |  |  |      |   | — |      |  |  |  |   | 350,000 |  |
| Revolving creditfacility  |  |  |      |   | 117,800 |      |  |  |  |   | 123,200 |  |
| Totalsenior debt          |  |  |      |   | 742,800 |      |  |  |  |   | 748,200 |  |
| Less:current portion      |  |  |      |   | 15,000  |      |  |  |  |   | 7,500   |  |
| Totallong-term seniordebt |  |  |      | $ | 727,800 |      |  |  |  | $ | 740,700 |  |
|                           |

Inaccordance with the requirements of the Amended Credit Agreement, theCompany is required to maintain certain Interest Rate ProtectionAgreements (‘‘IRPAs’’) on a portion of itsdebt to reduce the potential exposure of the Company’s futurecash flows to fluctuations in variable interest rates. The minimumrequirement varies depending on the Company’s Total LeverageRatio, as defined in the Amended Credit Agreement. Pursuant to theserequirements, the Company entered into certain IRPAs that consist of(i) interest rate collars (‘‘Collars’’)that establish a base interest rate ceiling(‘‘Cap’’) and a base interest rate floor(‘‘Floor’’) and (ii) interest rate swaps(‘‘Swaps’’) in which the Company exchangesa portion of its floating rate debt for fixed rate debt, in each caseat no initial cost to the Company.

Interest RateCollars — Pursuant to the terms of theCollars, in the event 90-day LIBOR exceeds the Cap, the Company willreceive cash from the Collar issuers to compensate for the rate inexcess of the Cap. If the 90-day LIBOR is lower than the Floor, theCompany will pay cash to the Collar issuers to compensate for the ratebelow the Floor. Each of the Collars is for a fixed notional amount, asset forth in the chart below. As of June  25,  2006, theaggregate notional amount of outstanding Collars in effect was$300  million.

The following table summarizes theCompany’s existing Collars and contracts for Collars includingthose that have an effective date occurring in the future, in each caseat June  25,2006:

|                  |  |  |         |  |     |           |  |  |                |  |      |      |  |  |                                |  |  |           |
|------------------|--|--|---------|--|-----|-----------|--|--|----------------|--|------|------|--|--|--------------------------------|--|--|-----------|
| EffectiveDate    |  |  | CAP (%) |  |     | Floor (%) |  |  | NotionalAmount |  |      | Term |
| August  20,2004  |  |  |         |  | 4.5 |           |  |  |                |  | 2.05 |      |  |  | $  50 million |  |  | 2.0years  |
| October  29,2004 |  |  |         |  | 4.5 |           |  |  |                |  | 2.08 |      |  |  | $100 million            |  |  | 2.0years  |
| January  29,2005 |  |  |         |  | 4.5 |           |  |  |                |  | 2.38 |      |  |  | $  50 million |  |  | 2.0years  |
| January  29,2005 |  |  |         |  | 4.5 |           |  |  |                |  | 2.47 |      |  |  | $100 million            |  |  | 2.0years  |
| July  24,2006    |  |  |         |  | 6.0 |           |  |  |                |  | 4.75 |      |  |  | $  25 million |  |  | 5.0years  |
| August  21,2006  |  |  |         |  | 6.0 |           |  |  |                |  | 4.71 |      |  |  | $  25 million |  |  | 5.0years  |
| August  21,2006  |  |  |         |  | 6.0 |           |  |  |                |  | 4.70 |      |  |  | $  25 million |  |  | 5.0years  |
| January  29,2007 |  |  |         |  | 6.0 |           |  |  |                |  | 3.39 |      |  |  | $100 million            |  |  | 2.75years |
|                  |

Interest RateSwaps — Pursuant to the terms of the Swaps, inthe event 90-day LIBOR exceeds the fixed interest rate, the Companywill receive cash from the Swap issuers to compensate for the rate inexcess of the fixed rate. If the 90-day LIBOR is lower than the fixedrate, the Company will 

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

5.    Debtand Interest Rate Derivatives    (continued)

pay cash to the Swap issuers to compensate forthe rate below the fixed rate. As of June  25,  2006, theaggregate notional amount of existing Swaps in effect was $225million.

The following table summarizes the Company’sexisting and executed contracts for Swaps including those that have aneffective date occurring in the future, in each case at June25,  2006:

|                |  |  |                |  |  |                |   |                               |      |  |  |            |
|----------------|--|--|----------------|--|--|----------------|---|-------------------------------|------|--|--|------------|
| EffectiveDate  |  |  | Fixed Rate (%) |  |  | NotionalAmount |   |                               | Term |
| December3,2004 |  |  | 3.48           |  |  |                | $ |   50 million |      |  |  | 3.0years   |
| April  1,2005  |  |  | 4.06           |  |  |                | $ | 100 million            |      |  |  | 4.75years  |
| April  1,2005  |  |  | 4.085          |  |  |                | $ | 112 million            | (1)  |  |  | 4.75 years |
| July  24,2006  |  |  | 5.33           |  |  |                | $ |   75 million |      |  |  | 5.0years   |
|                |

|  |
|--|
|  |  |
|  |

|     |                                                                                                                                 |
|-----|---------------------------------------------------------------------------------------------------------------------------------|
| (1) | Representsthe average of an amortizing notional amount for which the actualnotional amount at June  25,  2006 was $75.0million. |

Under Statement of Financial Accounting Standards(‘‘SFAS’’) No. 133, Accounting forDerivative Instruments and Hedging Activities, as amended, the fairmarket value of derivatives is reported as an adjustment to OtherComprehensive Income/Loss (‘‘OCI’’). TheIRPAs were fully effective in hedging a portion of the changes in cashflows related to the debt obligation during the twenty-six week periodended June  25,  2006 and the fiscal year endedDecember  25,  2005. The Company reported a deferred gainin OCI as of June  25,  2006 of approximately $5.3million compared to a deferred loss of $0.5  million atJune  26,  2005 (which are net of $3.7  million and$0.3  million of deferred taxes, respectively).

The fairmarket value of the derivatives is reflective of the price that a thirdparty would be willing to pay or receive in arm’s lengthtransactions and includes adjustments for mark-to-market changes in therelated interest rates. During the twenty-six week period endedJune  25,  2006, the fair market value of the IRPAsincreased by $9.0  million to $16.2  million. Incomparison, the Company’s hedges during the twenty-six weekperiod ended June  26,  2005, sustained a decline in theirfair market value of $0.8  million to $ 0.8million.

The Company’s weighted average effective interestrate was approximately 5.7 percent for the thirteen week period endedJune  25,  2006 and approximately 4.9 percent for thethirteen week period ended June  26,  2005. The effectiveinterest rates for the thirteen week period ended June25,  2006 and June  26,  2005 includes the impact ofa $0.9  million pre-tax benefit and a $0.5  million pre-taxcharge, respectively, realized and reported as a component of interestexpense related to the Company’s IRPAs.

Each IRPA isdesignated for all or a portion of the principal balance and term of aspecific debt obligation. From time to time, the Company may enter intoadditional IRPAs for nominal amounts on the outstanding debt that will,at a minimum, meet the requirements of the Credit Agreement.

6.    StockIncentive Plans

The Company has adopted SFAS No. 123(R),Accounting for Stock-Based Compensation, as of the beginning of2006 using the modified prospective method. This statement requiresthat share based transactions be accounted for using a fair value basedmethod to recognize compensation expense. It also requires that thebenefit of tax deductions in excess of recognized compensation cost bereported as a financing cash flow, rather than as an operating cashflow as was required under previous pronouncements.

Prior to theadoption of SFAS No. 123(R), the Company accounted for stock-basedcompensation awards using the intrinsic value method as prescribed byAccounting Principles Board Opinion No. 25. 

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

6.    StockIncentive Plans (continued)

Accordingly, the Company did not recognizecompensation expense in the Condensed Consolidated Statement of Incomefor options granted that had an exercise price equal to the marketvalue of the underlying common stock on the date of grant. Prior toadoption of SFAS 123 (R) the Company provided certain pro formadisclosures for stock-based awards as if the fair-value-based approachof SFAS No. 123 had been applied.

During 1997, theCompany’s Board of Directors (the‘‘Board’’) adopted, and theCompany’s stockholders approved, the Company’s 1997 StockIncentive Plan (the ‘‘1997 Plan’’). The1997 Plan has a ten year term and will be effective through the firstquarter of 2007. The 1997 Plan, as amended, authorizes grants of up to7,383,750 shares of Common Stock through: (i) incentive stock optionsand non-qualified stock options (in each case, with or without stockappreciation rights) to acquire common stock; (ii) awards of restrictedshares of Common Stock; and (iii) stock units to such directors,officers and other employees of, and consultants to, the Company andits subsidiaries and affiliates as may be designated by theCompensation Committee of the Board or such other committee of theBoard as the Board may designate. Options and other awards grantedunder the plan will remain in effect after the plan has terminated inaccordance with their respective terms. Options granted under the 1997Plan do not accrue dividends until the option is exercised and commonstock is issued to the option holder. Restricted stock units areentitled to dividends and the Company accrues dividends for all periodsin which a restricted stock unit is outstanding, but still subject tovesting.

Incentive stock options are granted at no less than fairmarket value of the common stock on the date of grant. The exerciseprice per share of common stock underlying all other non-statutorystock options is established by the Compensation Committee of theBoard. Stock options generally vest evenly over a five year period at arate of 20 percent per year commencing on the first anniversary afterissuance, continuing through the fifth anniversary, at which time 100percent are vested. Upon vesting, options may be exercised at thediscretion of the holder at anytime until the option expires, which isgenerally ten years after issuance. No stock options were grantedduring the thirteen week or twenty-six week periods ended June25,  2006.

On October  27,  2005, the Companyamended certain stock option award agreements to accelerate vesting ofapproximately 1.4  million options for which the exercise pricewas above the then current market price. This resulted in approximately$2.9  million of compensation expense recognized on a pro-formabasis as required by SFAS No. 123. Additionally, the Companyaccelerated the vesting of 0.1  million shares which were in themoney at the time of vesting, resulting in an additional expense beingrecognized of approximately $12,000. The Company currently has nounvested stock options outstanding.

The following tableillustrates the effect on net income after tax and net income percommon share as if the Company had applied the fair value recognitionprovisions of SFAS No. 123(R) to stock-based compensation for thethirteen and twenty six weeks ended June  26,  2005:

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

6.    StockIncentive Plans (continued)

|                                                                                                                                          |  |  |                                  |   |        |                                    |  |  |  |   |        |   |
|------------------------------------------------------------------------------------------------------------------------------------------|--|--|----------------------------------|---|--------|------------------------------------|--|--|--|---|--------|---|
| (Inthousands, except per share amounts)                                                                                                  |  |  | Thirteen weeksendedJune 26, 2005 |   |        | Twenty-six weeks endedJune 26,2005 |
| Netincome:                                                                                                                               |  |  |                                  |   |   |                                    |  |  |  |   |   |   |
| Asreported                                                                                                                               |  |  |                                  | $ | 15,372 |                                    |  |  |  | $ | 22,871 |   |
| Add:Stock-based employee compensation expense included in reported netincome net of related taxeffects                                   |  |  |                                  |   | 23     |                                    |  |  |  |   | 251    |   |
| Deduct: Totalstock-based employee compensation expense determined under fair valuebased method for all awards, net of related taxeffects |  |  |                                  |   | (577   | )                                  |  |  |  |   | (1,310 | ) |
| Proforma                                                                                                                                 |  |  |                                  | $ | 14,818 |                                    |  |  |  | $ | 21,812 |   |
| Netincome per commonshare:                                                                                                               |  |  |                                  |   |   |                                    |  |  |  |   |   |   |
| Asreported:                                                                                                                              |  |  |                                  |   |   |                                    |  |  |  |   |   |   |
| Basic                                                                                                                                    |  |  |                                  | $ | 0.37   |                                    |  |  |  | $ | 0.55   |   |
| Diluted                                                                                                                                  |  |  |                                  | $ | 0.37   |                                    |  |  |  | $ | 0.54   |   |
| Proforma:                                                                                                                                |  |  |                                  |   |   |                                    |  |  |  |   |   |   |
| Basic                                                                                                                                    |  |  |                                  | $ | 0.36   |                                    |  |  |  | $ | 0.52   |   |
| Diluted                                                                                                                                  |  |  |                                  | $ | 0.35   |                                    |  |  |  | $ | 0.52   |   |
|                                                                                                                                          |

Thefollowing table summarizes the Company’s stock option activityfor the twenty-six week period ended June  25,2006:

|                                        |  |  |                                    |  |           |                                   |  |  |                 |   |         |                               |  |  |  |  |           |  |  |  |  |   |       |  |
|----------------------------------------|--|--|------------------------------------|--|-----------|-----------------------------------|--|--|-----------------|---|---------|-------------------------------|--|--|--|--|-----------|--|--|--|--|---|-------|--|
|                                   |  |  | Twenty-sixweeks endedJune 25, 2006 |  |           | Twenty-six weeksendedJune 26,2005 |
|                                   |  |  | NumberOfOptions                    |  |           | Weighted-AverageExercisePrice     |  |  | NumberOfOptions |   |         | Weighted-AverageExercisePrice |
| Outstanding – beginning ofperiod |  |  |                                    |  | 5,218,660 |                                   |  |  |                 | $ | 18.31   |                               |  |  |  |  | 5,010,285 |  |  |  |  | $ | 18.43 |  |
| Granted                                |  |  |                                    |  | —   |                                   |  |  |                 |   | — |                               |  |  |  |  | 400,900   |  |  |  |  |   | 16.95 |  |
| Exercised                              |  |  |                                    |  | —   |                                   |  |  |                 |   | — |                               |  |  |  |  | 5,395     |  |  |  |  |   | 15.09 |  |
| Forfeited                              |  |  |                                    |  | 48,065    |                                   |  |  |                 | $ | 18.69   |                               |  |  |  |  | 74,599    |  |  |  |  |   | 20.18 |  |
| Outstanding– end ofperiod        |  |  |                                    |  | 5,170,595 |                                   |  |  |                 | $ | 18.31   |                               |  |  |  |  | 5,331,191 |  |  |  |  | $ | 18.30 |  |
| Exercisableat end ofperiod             |  |  |                                    |  | 5,170,595 |                                   |  |  |                 | $ | 18.31   |                               |  |  |  |  | 5,331,191 |  |  |  |  | $ | 18.30 |  |
|                                        |

Furtherinformation about stock options outstanding at June  25,2006 is asfollows:

|                         |  |  |                   |  |           |                                                 |  |  |                               |  |     |                   |  |  |                               |   |       |  |  |  |  |  |           |  |  |  |  |   |       |  |
|-------------------------|--|--|-------------------|--|-----------|-------------------------------------------------|--|--|-------------------------------|--|-----|-------------------|--|--|-------------------------------|---|-------|--|--|--|--|--|-----------|--|--|--|--|---|-------|--|
| Rangeof Exercise Prices |  |  | NumberOutstanding |  |           | Weighted-AverageRemainingContractualLife(years) |  |  | Weighted-AverageExercisePrice |  |     | NumberExercisable |  |  | Weighted-AverageExercisePrice |
| $14.00 –16.00     |  |  |                   |  | 1,838,879 |                                                 |  |  |                               |  | 3.7 |                   |  |  |                               | $ | 14.99 |  |  |  |  |  | 1,838,879 |  |  |  |  | $ | 14.99 |  |
| $16.01–18.00      |  |  |                   |  | 999,135   |                                                 |  |  |                               |  | 7.3 |                   |  |  |                               |   | 17.31 |  |  |  |  |  | 999,135   |  |  |  |  |   | 17.31 |  |
| $18.01–20.00      |  |  |                   |  | 372,943   |                                                 |  |  |                               |  | 7.7 |                   |  |  |                               |   | 19.38 |  |  |  |  |  | 372,943   |  |  |  |  |   | 19.38 |  |
| $20.01–22.50      |  |  |                   |  | 1,959,638 |                                                 |  |  |                               |  | 2.8 |                   |  |  |                               |   | 21.73 |  |  |  |  |  | 1,959,638 |  |  |  |  |   | 21.73 |  |
|                    |  |  |                   |  | 5,170,595 |                                                 |  |  |                               |  | 4.3 |                   |  |  |                               | $ | 18.31 |  |  |  |  |  | 5,173,095 |  |  |  |  | $ | 18.31 |  |
|                         |

TheCompany uses the Black-Scholes option pricing model to determine thefair value of stock options at the date of each grant. The assumptionsused for the inputs for volatility and dividend yield for theBlack-Scholes model are derived from the historical data of theCompany’s common stock. 

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

6.    StockIncentive Plans (continued)

Assumptions for the risk free interest rateare derived from the appropriate yields on treasury securities andexpected life of options is derived from historical employee optionactivity. Restricted stock unit values are valued based on theCompany’s common stock underlying the units granted as of thegrant date.

The following table shows assumptions used incomputing fair market values on options granted during the twenty-sixweek periods ended June  26,  2005, no options were grantedduring the twenty-six week period ended June  25,2006.

|                               |  |  |                                    |  |     |               |
|-------------------------------|--|--|------------------------------------|--|-----|---------------|
|                          |  |  | Twenty-sixweeks endedJune 26, 2005 |
| Risk free interestrate        |  |  |                                    |  | 4.1 | %             |
| Expected annualizedvolatility |  |  |                                    |  | 14  | %             |
| Dividendyield                 |  |  |                                    |  | 0   | %             |
| Expected life ofoption        |  |  |                                    |  | 7   |  Years |
|                               |

During thetwenty-six weeks ended June  25,  2006, the Company issued355,125 restricted stock units (‘‘RSUs’’)pursuant to the 1997 Plan. Of those issued, 37,000 units vest overeither a one or two year period of time. All other units issued vestbased on the achievement of performance milestones over a period oftime, typically achievement of certain levels of EBITDA within fiveyears. The Company has assumed a 10% rate of forfeiture. TheCompany assesses the probability of the performance targets beingachieved over the vesting period of the grants at each reportingperiod. If it is likely that the performance targets will be achievedover the vesting period, expense is recorded during the period forthose shares which are likely to vest as a result of the achievement ofthose targets. To date, the Company has not recorded any expense forthe units that may vest based on achievement of performancetargets.

In total, the Company has issuedapproximately 513,000 RSUs under the Plan, of which 440,000 remainunvested as of June  25,  2006. Of these restricted units,22,325 were issued to directors of the Company and vest monthly over atwelve-month period. The remainder of the RSUs were issued to keyemployees and vest based on the achievement of performance-basedmilestones, and/or over a five year period.

7.    Comprehensive Income

The components ofcomprehensive income for the thirteen and twenty-six weeks endedJune  25,  2006 and June  26,  2005 are asfollows:

|                                                                                        |  |  |                     |   |        |                       |  |  |               |   |         |              |  |  |  |   |        |   |  |  |  |   |        |   |
|----------------------------------------------------------------------------------------|--|--|---------------------|---|--------|-----------------------|--|--|---------------|---|---------|--------------|--|--|--|---|--------|---|--|--|--|---|--------|---|
|                                                                                   |  |  | Thirteenweeks ended |   |        | Twenty-six weeksended |
| (Inthousands)                                                                          |  |  | June 25, 2006       |   |        | June26, 2005          |  |  | June 25, 2006 |   |         | June 26,2005 |
| Netincome                                                                              |  |  |                     | $ | 9,778  |                       |  |  |               | $ | 15,372  |              |  |  |  | $ | 11,543 |   |  |  |  | $ | 22,871 |   |
| Reclassificationof unrealized gains on fully effective hedges to net income, net oftax |  |  |                     |   | (544   | )                     |  |  |               |   | 324     |              |  |  |  |   | (777   | ) |  |  |  |   | 393    |   |
| Netchange in fair value of fully effective hedges, net oftax                           |  |  |                     |   | 4,285  |                       |  |  |               |   | (5,327  | )            |  |  |  |   | 6,087  |   |  |  |  |   | (862   | ) |
| Markto market adjustment of investments, net oftax                                     |  |  |                     |   | 1      |                       |  |  |               |   | — |              |  |  |  |   | 3      |   |  |  |  |   | (18    | ) |
| Comprehensiveincome                                                                    |  |  |                     | $ | 13,520 |                       |  |  |               | $ | 10,369  |              |  |  |  | $ | 16,856 |   |  |  |  | $ | 22,384 |   |
|                                                                                        |

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

8.    Intangibleand Other Assets

Under SFAS No. 142, goodwill andindefinite-lived intangible assets are no longer amortized. However,they are reviewed annually or more frequently, if required, forimpairment. Separable intangible assets that are not deemed to have anindefinite life will continue to be amortized over their useful lives.The Company performs the required annual impairment tests as of thefirst day of the fourth quarter of each fiscal year.

The carrying amounts of goodwill and other intangibleassets are asfollows:

|                                                    |  |  |                    |   |         |                         |  |  |     |   |         |       |  |  |                         |   |         |     |  |  |  |   |         |  |  |  |  |   |         |   |  |  |  |   |         |  |
|----------------------------------------------------|--|--|--------------------|---|---------|-------------------------|--|--|-----|---|---------|-------|--|--|-------------------------|---|---------|-----|--|--|--|---|---------|--|--|--|--|---|---------|---|--|--|--|---|---------|--|
|                                               |  |  | Asof June 25, 2006 |   |         | As of December 25,2005  |
| (Inthousands)                                      |  |  | Gross              |   |         | AccumulatedAmortization |  |  | Net |   |         | Gross |  |  | AccumulatedAmortization |   |         | Net |
| Goodwill                                           |  |  |                    | $ | 845,713 |                         |  |  |     | $ | (63,210 | )     |  |  |                         | $ | 782,503 |     |  |  |  | $ | 842,791 |  |  |  |  | $ | (63,210 | ) |  |  |  | $ | 779,581 |  |
| Otherintangible assets not subject toamortization: |  |  |                    |   |    |                         |  |  |     |   |    |       |  |  |                         |   |    |     |  |  |  |   |    |  |  |  |  |   |    |   |  |  |  |   |    |  |
| Mastheads                                          |  |  |                    | $ | 137,900 |                         |  |  |     | $ | (92     | )     |  |  |                         | $ | 137,808 |     |  |  |  | $ | 137,900 |  |  |  |  | $ | (92     | ) |  |  |  | $ | 137,808 |  |
| Otherintangible assets subjectto                   |  |  |                    |   |    |                         |  |  |     |   |    |       |  |  |                         |   |    |     |  |  |  |   |    |  |  |  |  |   |    |   |  |  |  |   |    |  |
| amortization:                                      |  |  |                    |   |    |                         |  |  |     |   |    |       |  |  |                         |   |    |     |  |  |  |   |    |  |  |  |  |   |    |   |  |  |  |   |    |  |
| Customerand subscriberlists                        |  |  |                    |   | 9,657   |                         |  |  |     |   | (8,366  | )     |  |  |                         |   | 1,291   |     |  |  |  |   | 9,657   |  |  |  |  |   | (7,579  | ) |  |  |  |   | 2,078   |  |
| Non-competecovenants                               |  |  |                    |   | 4,347   |                         |  |  |     |   | (2,445  | )     |  |  |                         |   | 1,902   |     |  |  |  |   | 4,317   |  |  |  |  |   | (2,269  | ) |  |  |  |   | 2,048   |  |
| Debtissuancecosts                                  |  |  |                    |   | 6,292   |                         |  |  |     |   | (399    | )     |  |  |                         |   | 5,893   |     |  |  |  |   | 11,615  |  |  |  |  |   | (1,996  | ) |  |  |  |   | 9,619   |  |
| Totalother intangibleassets                        |  |  |                    | $ | 158,196 |                         |  |  |     | $ | (11,302 | )     |  |  |                         | $ | 146,894 |     |  |  |  | $ | 163,489 |  |  |  |  | $ | (11,936 | ) |  |  |  | $ | 151,553 |  |
|                                                    |

Identifiableintangible assets include customer and subscriber lists, non-competecovenants, and debt issuance costs, which have an estimable useful lifeand are amortizable on a straight-line basis over their useful lives.Indefinite-lived intangible assets include goodwill and mastheads,which are not amortizable. For purposes of expense classification,amortization of debt issuance costs are included as ‘‘Netinterest expense and other’’ in the CondensedConsolidated Statements of Income. The following table showsamortization expense for the thirteen week and twenty-six week periodsended June  25,  2006 and June  26,2005.

|                                           |  |  |                     |   |     |                       |  |  |               |   |     |              |  |  |  |   |       |  |  |  |  |   |       |  |
|-------------------------------------------|--|--|---------------------|---|-----|-----------------------|--|--|---------------|---|-----|--------------|--|--|--|---|-------|--|--|--|--|---|-------|--|
|                                      |  |  | Thirteenweeks ended |   |     | Twenty-six weeksended |
|                                      |  |  | June 25,2006        |   |     | June 26, 2005         |  |  | June 25, 2006 |   |     | June 26,2005 |
| Amortization expense for intangibleassets |  |  |                     | $ | 482 |                       |  |  |               | $ | 507 |              |  |  |  | $ | 963   |  |  |  |  | $ | 1,091 |  |
| Amortizationof debt issuancecosts         |  |  |                     |   | 239 |                       |  |  |               |   | 372 |              |  |  |  |   | 520   |  |  |  |  |   | 744   |  |
| Totalamortizationexpense                  |  |  |                     | $ | 721 |                       |  |  |               | $ | 879 |              |  |  |  | $ | 1,483 |  |  |  |  | $ | 1,835 |  |
|                                           |

Duringthe twenty-six week period ended June  26,  2006, theCompany wrote off $5.7  million in unamortized debt issuancecosts related to borrowings that were refinanced in the first quarterof 2006. Estimated amortization of identifiable intangible assets is asfollows (inthousands):

|            |  |  |  |   |       |  |
|------------|--|--|--|---|-------|--|
| 2006       |  |  |  | $ | 2,507 |  |
| 2007       |  |  |  |   | 1,910 |  |
| 2008       |  |  |  |   | 1,401 |  |
| 2009       |  |  |  |   | 1,363 |  |
| 2010       |  |  |  |   | 1,233 |  |
| Thereafter |  |  |  |   | 2,034 |  |
|            |

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

8.    Intangibleand Other Assets (continued)

The changes in the carrying amount ofgoodwill during the twenty-six weeks ended June  25,  2006and the fiscal year ended December  25,  2005 reflect theaddition of goodwill for the acquisitions of JobsInTheUS and SuburbanLifestyles, respectively, as well as adjustments, to the purchaseprices of JobsInTheUS and our Michigan cluster.

The changes togoodwill are asfollows:

|                                   |  |  |             |   |         |                 |  |  |  |   |         |   |
|-----------------------------------|--|--|-------------|---|---------|-----------------|--|--|--|---|---------|---|
| (Inthousands)                     |  |  | June25,2006 |   |         | December25,2005 |
| Beginningbalance                  |  |  |             | $ | 779,581 |                 |  |  |  | $ | 772,683 |   |
| Goodwillacquired during theperiod |  |  |             |   | 2,917   |                 |  |  |  |   | 14,891  |   |
| Adjustments                       |  |  |             |   | 5       |                 |  |  |  |   | (7,993  | ) |
| Endingbalance                     |  |  |             | $ | 782,503 |                 |  |  |  | $ | 779,581 |   |
|                                   |

9.    Pensionand Other Post-retirement Benefits

Net Periodic BenefitCost for the thirteen and twenty-six week periods ended June25,  2006 and June  26,  2005 included the followingcomponents:

|                                        |  |  |                 |   |         |                              |  |  |              |   |         |             |  |  |  |   |         |   |  |  |  |   |         |   |
|----------------------------------------|--|--|-----------------|---|---------|------------------------------|--|--|--------------|---|---------|-------------|--|--|--|---|---------|---|--|--|--|---|---------|---|
|                                   |  |  | PensionBenefits |   |         | OtherPost-RetirementBenefits |
| (Inthousands)Thirteen weeksended:      |  |  | June 25,2006    |   |         | June26,2005                  |  |  | June 25,2006 |   |         | June26,2005 |
| Components of Net PeriodicBenefitCost: |  |  |                 |   |    |                              |  |  |              |   |    |             |  |  |  |   |    |   |  |  |  |   |    |   |
| ServiceCost                            |  |  |                 | $ | 763     |                              |  |  |              | $ | 699     |             |  |  |  | $ | 6       |   |  |  |  | $ | 5       |   |
| InterestCost                           |  |  |                 |   | 1,550   |                              |  |  |              |   | 1,565   |             |  |  |  |   | 66      |   |  |  |  |   | 66      |   |
| ExpectedReturn on PlanAssets           |  |  |                 |   | (2,141  | )                            |  |  |              |   | (2,066  | )           |  |  |  |   | — |   |  |  |  |   | — |   |
| AmortizationofNet:                     |  |  |                 |   |    |                              |  |  |              |   |    |             |  |  |  |   |    |   |  |  |  |   |    |   |
| TransitionObligation                   |  |  |                 |   | — |                              |  |  |              |   | — |             |  |  |  |   | — |   |  |  |  |   | — |   |
| PriorServiceCost                       |  |  |                 |   | (88     | )                            |  |  |              |   | (88     | )           |  |  |  |   | — |   |  |  |  |   | (17     | ) |
| Loss/(Gain)                            |  |  |                 |   | 388     |                              |  |  |              |   | 387     |             |  |  |  |   | (98     | ) |  |  |  |   | (121    | ) |
| NetPeriodicBenefit/(Cost)              |  |  |                 | $ | 472     |                              |  |  |              | $ | 497     |             |  |  |  | $ | (26     | ) |  |  |  | $ | (67     | ) |
|                                        |

|                                        |  |  |                 |   |         |                              |  |  |              |   |         |             |  |  |  |   |         |   |  |  |  |   |         |   |
|----------------------------------------|--|--|-----------------|---|---------|------------------------------|--|--|--------------|---|---------|-------------|--|--|--|---|---------|---|--|--|--|---|---------|---|
|                                   |  |  | PensionBenefits |   |         | OtherPost-RetirementBenefits |
| (Inthousands)Thirteen weeksended:      |  |  | June 25,2006    |   |         | June26,2005                  |  |  | June 25,2006 |   |         | June26,2005 |
| Components of NetPeriodic BenefitCost: |  |  |                 |   |    |                              |  |  |              |   |    |             |  |  |  |   |    |   |  |  |  |   |    |   |
| ServiceCost                            |  |  |                 | $ | 1,526   |                              |  |  |              | $ | 1,398   |             |  |  |  | $ | 12      |   |  |  |  | $ | 10      |   |
| InterestCost                           |  |  |                 |   | 3,100   |                              |  |  |              |   | 3,130   |             |  |  |  |   | 132     |   |  |  |  |   | 132     |   |
| ExpectedReturn on PlanAssets           |  |  |                 |   | (4,282  | )                            |  |  |              |   | (4,132  | )           |  |  |  |   | — |   |  |  |  |   | — |   |
| AmortizationofNet:                     |  |  |                 |   |    |                              |  |  |              |   |    |             |  |  |  |   |    |   |  |  |  |   |    |   |
| TransitionObligation                   |  |  |                 |   | — |                              |  |  |              |   | — |             |  |  |  |   | — |   |  |  |  |   | — |   |
| PriorServiceCost                       |  |  |                 |   | (176    | )                            |  |  |              |   | (176    | )           |  |  |  |   | — |   |  |  |  |   | (34     | ) |
| Loss/(Gain)                            |  |  |                 |   | 776     |                              |  |  |              |   | 774     |             |  |  |  |   | (196    | ) |  |  |  |   | (242    | ) |
| NetPeriodicBenefit/(Cost)              |  |  |                 | $ | 944     |                              |  |  |              | $ | 994     |             |  |  |  | $ | (52     | ) |  |  |  | $ | (134    | ) |
|                                        |

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JOURNALREGISTER COMPANYNOTES TO CONDENSED CONSOLIDATED FINANCIALSTATEMENTSJune  25,2006(Unaudited)

9.    Pensionand Other Post-retirement Benefits (continued)

The Company currently expects tocontribute an aggregate of approximately $139,000 to its definedbenefit pension plans in fiscal year 2006. For the post-retirementhealth and life insurance plans, the Company expects to contributeapproximately $429,000 in fiscal year 2006. During the thirteen weeksended June  25,  2006, approximately $34,000 and $89,000was contributed by the Company to the Company-sponsored defined benefitpension plans and the Company-sponsored post-retirement health and lifeinsurance plans, respectively. During the twenty-six weeks endedJune  25,  2006, approximately $71,000 and $172,000 wascontributed by the Company to the Company-sponsored defined benefitpension plans and the Company-sponsored post-retirement health and lifeinsurance plans,respectively.

10.    RecentlyIssued Accounting Pronouncements

In July 2006,the Financial Accounting Standards Board(‘‘FASB’’) issued FASB Interpretation No.48 Accounting for Uncertainty in Income Taxes — aninterpretation of SFAS No. 109 (‘‘FIN48’’), which prescribes a recognition threshold andmeasurement process for recording in the financial statements uncertaintax positions taken or expected to be taken in a tax return.Additionally, FIN 48 provides guidance on the derecognition,classification, accounting in interim periods and disclosurerequirements for uncertain tax positions. FIN 48 is effective forfiscal years beginning after December 15, 2006. The Company iscurrently assessing the impact of FIN 48 but does not anticipate itwill have a material effect on its consolidated financial position orresults of operations.

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Item2.    Management’s Discussion and Analysis of FinancialCondition and Results of Operations

Cautionary Note RegardingForward-Looking Statements

Statements in this Quarterly Reporton Form 10-Q that are not purely historical are forward-lookingstatements within the meaning of Section 27A of the Securities Act of1933, as amended, and Section 21E of the Securities Exchange Act of1934, as amended, including statements regarding our (as hereinafterdefined) expectations, forecasts, projections, hopes, intentions orstrategies regarding the future. Forward-looking statements includestatements regarding our plans and objectives for future operations andtrends affecting our financial condition and results of operations. Inaddition, the words ‘‘anticipates,’’‘‘projects,’’‘‘plans,’’‘‘intends,’’‘‘estimates,’’‘‘expects,’’‘‘may,’’‘‘believes’’ and similar words are intendedto identify these forward-looking statements. All forward-lookingstatements in this Report are based on information available to us asof the date this Report is filed with the Securities and ExchangeCommission, and we assume no obligation to update any suchforward-looking statements, except as required by law. Allforward-looking statements involve risks and uncertainties. Actualresults may differ materially from those expressed or implied by suchforward-looking statements as a result of certain factors including,but not limited to, the unavailability or a material increase in theprice of newsprint, the success of our acquisition strategy,dispositions, our ability to achieve cost reductions and integrateacquisitions, competitive pressures, general or regional economicconditions, advertising trends and material increases in interestrates. These and other factors are discussed in more detail in ourother filings with the SEC, including our Annual Report on Form 10-Kfor the fiscal year ended December  25,  2005. We undertakeno obligation to release publicly the results of any future revisionswe may make to forward-looking statements to reflect events orcircumstances after the date hereof or to reflect the occurrence ofunanticipated events.

General

Our principal business ispublishing newspapers in print and online in the United States, and ourpublications are primarily daily and non-daily newspapers. We deriveour revenues primarily from advertising, paid circulation andcommercial printing.

As of June  25,  2006 we own 27daily newspapers, and 365 non-daily publications. We also currentlyoperate 222 individual Web sites that are affiliated with our dailynewspapers, non-daily publications and our recently acquired network ofemployment Web sites. All of our web sites can be accessed atwww.journalregister.com. Our operations are strategically clustered inseven geographic areas: Greater Philadelphia; Michigan; Connecticut;Greater Cleveland; New England; and the Capital-Saratoga and Mid-Hudsonregions of New York. We also own JobsInTheUS, a network of premieremployment Web sites in the Northeast and have an investment inPowerOne Media, LLC, a leading provider of online solutions fornewspapers. We have total paid daily circulation of approximately628,000, total paid Sunday circulation of approximately 658,000 andtotal non-daily distribution of approximately 6  million.

The principal elements of our strategy are to: (i) expandadvertising revenues and readership, in print and online; (ii) grow byacquisition; (iii) capture synergies from geographic clustering; and(iv) implement consistent operating policies andstandards.

As part of our strategy, we focus on increasingadvertising and circulation revenues and expanding readership at ourexisting and newly acquired properties. We have also developed certainoperating policies and standards, which we believe have resulted insignificant improvements in the cash flow and profitability of existingand acquired newspapers, including: (i) focusing on local content; (ii)maintaining and improving product quality; (iii) enhancingdistribution; and (iv) promoting communityinvolvement.

We are a leader in the newspaper industry inexecuting a clustering strategy. We believe that our clusteringstrategy creates significant synergies and cost savings within eachcluster, including cross-selling of advertising, centralized newsgathering and consolidation of printing, production and 

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back office activities. We also believe thatour clustering strategy enables us to improve print quality anddistribution, introduce new products and services in a cost-effectivemanner and increase readership. In addition, clustering enables ouradvertisers to expand their reach and target their message bothgeographically and demographically.

We generate revenues throughadvertising, paid circulation, including single copy sales andsubscription sales, and commercial printing and other activities. Forthe thirteen and twenty-six week periods ending June  25,2006, advertising, paid circulation and commercial printing and otheractivities represented 78%, 18% and 4% of totalrevenue, respectively. Our advertiser base is predominantly local. Ournewspapers and Web sites seek to produce desirable results for localadvertisers by targeting readers based on certain geographic anddemographic characteristics. We seek to increase readership, andthereby generate traffic for our advertisers, by focusing on highproduct quality, compelling and primarily proprietary local content andcreative and interactive promotions. We also publish numerous specialsections, as well as niche and special interest publications. Suchpublications tend to increase readership within targeted demographicgroups and geographic areas. Management believes that as a result ofthese strategies, our newspapers represent an attractive andcost-effective medium for our readers and advertisers.

Ouradvertising revenues are derived primarily from a broad group of localadvertisers. Management believes that our advertising revenues tend tobe relatively stable because our newspapers have a broad base of localretail and classified advertising, rather than a reliance on thegenerally more volatile national and major account advertising. Ouradvertising revenue and, to a lesser extent, circulation revenues aredependent on a variety of factors specific to the communities that ournewspapers serve. For example, our Michigan and Ohio clusters areimpacted by the automotive sector and have experienced weakness as aresult of economic conditions in these areas.

OnlineOperations

We are committed to expanding our business throughour Internet initiatives. Online revenues of $4.1  million and$7.4  million for the thirteen and twenty-six week periods endingJune  25,  2006 are included in advertising revenues. Ouronline revenues have increased by 37.2% and 34.1% fromthe comparable prior year periods primarily as a result of ourJobsInTheUs acquisition in December  2005. Our online objectiveis to make our Web sites, all of which are accessible throughwww.journalregister.com, the local information portal for theirrespective markets by establishing such Web sites as the indispensablesource of useful and reliable community news, sports, information andadvertising in their markets. We currently operate 222 Web sites whichare affiliated with our daily newspapers and non-dailypublications.

Acquisitions

On December  6,2005, we completed the acquisition of the assets of JobsInTheUS, basedin Westbrook, Maine. This acquisition included the online recruitingWeb sites of JobsInTheUS.com, JobsInME.com, JobsInNH.com, JobsInVT.com,JobsInRI.com, JobsInMA.com and other domain names. Founded in 1999,JobsInTheUS is one of the fastest-growing local job Internet sites– both in terms of unique visits to the Web sites and jobsposted. The acquired company specializes in state-specific job Internetsites where qualified candidates who want to work in a particularregion find a match with local employers. JobsInTheUS is expected tobecome the cornerstone of our expanded online recruitment product andwhen paired with our local newspapers and Web sites, an important stepfor our future.

On March  29,  2006, we acquired theassets of the Suburban Lifestyles Community Newspaper Group,(‘‘Suburban Lifestyles’’). Based inRochester Hills, Michigan, Suburban Lifestyles publications aredistributed in many of the affluent and growing neighborhoods ofOakland and Macomb Counties and focus on local news and information ineach of the communities served. Suburban Lifestyles is being integratedinto our Michigan Cluster.

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Critical Accounting Policies andEstimates

General

Our discussion and analysis ofour financial condition and results of operations are based upon ourcondensed consolidated interim financial statements, which have beenprepared by us, without audit, in accordance with accounting principlesgenerally accepted in the United States. The preparation of thesefinancial statements requires us to make estimates and judgments thataffect the reported amounts of assets, liabilities, revenues andexpenses, and related disclosure of contingent assets and liabilities.On an on-going basis, we evaluate our estimates, including thoserelated to bad debts, inventories, investments, remaining useful livesof long-lived assets, income taxes, pensions and other post-retirementbenefits, as well as contingencies and litigation. We base ourestimates on historical experience and actuarial studies and on otherassumptions that are believed to be reasonable and applicable under thecircumstances, the results of which form the basis for making judgmentsabout the carrying values of assets and liabilities that are notreadily apparent from other sources. Actual results may differ fromthese estimates under different assumptions or conditions. We believethe following critical accounting policies affect our more significantjudgments and estimates used in the preparation of our consolidatedfinancial statements.

Segment Reporting

We areprimarily engaged in the publishing of daily and non-daily newspapersin print and online in the United States. Newspapers are typicallydistributed through local distribution channels, which consist ofcontract carriers and single copy outlets. We consider this business tobe one operating segment. This operating segment consists of severalgeographically diverse operating units, which are locally managed, butare aggregated into one segment because each of our units is engaged inthe same essential business activity in each local market served. Thecombined operating units have similar economic characteristics based onsimilar products, services, customers, production processes anddistribution systems. We believe this presentation of our financialcondition and performance is consistent with the way in which ouroperations are managed.

Accounts Receivable and Allowancefor Doubtful Accounts

Accounts receivable consist primarilyof amounts due to us from normal business activities. The allowance fordoubtful accounts represents reserves for the estimated loss from theinability of customers to make required payments. We use historicalexperience as well as current market information in determining theestimate. We write-off accounts receivable, which are deemeduncollectible, on a specific identification basis. If the financialcondition of our customers were to deteriorate, resulting in animpairment of their ability to make payments, additional allowances maybe required.

Goodwill and Other IntangibleAssets

Identifiable intangible assets, such as customerlists and covenants not to compete, are amortized using thestraight-line method over their estimated useful lives for the yearspresented in our consolidated financial statements. Under SFAS No. 142,goodwill and indefinite-lived intangible assets are no longer amortizedbut are reviewed annually, or more frequently if required, forimpairment. This asset impairment review assesses the fair value of theassets based on the future cash flows the assets are expected togenerate. An impairment loss is recognized when estimated undiscountedfuture cash flows expected to result from the use of the asset plus netproceeds expected from the disposition of the asset (if any) are lessthan the carrying value of the asset. This approach uses estimates forfuture market growth, forecasted revenue and costs, expected periodsthe assets will be utilized and appropriate discount rates. Changes tothese estimates, including the inability to attain forecasted revenueand cost expectations, could result in the recognition of a futureimpairment loss. Separable intangible assets that are not deemed tohave an indefinite life will continue to be amortized over their usefullives.

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Pension and Post-retirementBenefits

Pension and post-retirement benefit costs andcredits are developed from actuarial valuations. Inherent in thesevaluations are key assumptions including discount rates and expectedreturn on plan assets. We consider current market conditions, includingchanges in interest rates, in selecting these assumptions. Changes inthe related pension and post-retirement benefit costs or credits mayoccur in the future as a result of fluctuations in our headcount,changes in actuarial assumptions and marketperformance.

Self-Insurance

We are self-insuredfor a portion of our insurable risks. We analyze our claims experienceand consult with actuaries and administrators in determining anadequate liability for self-insuredclaims.

Litigation

We are involved in litigationmatters that have arisen in the ordinary course of business. We believethat the outcome of these legal proceedings will not have a materialadverse effect on our financial condition or results ofoperations.

Revenue Recognition

Revenue is earnedfrom the sale of advertising, circulation and commercial printing.Advertising revenues are recognized, net of discounts, in the periodwhen advertising is printed in our publications or placed on our Websites. Circulation revenues are recognized when purchased newspapersare distributed, net of any discounts or incentives offered toresellers and customers. Amounts received from customers in advance ofrevenue recognition are deferred as liabilities.

To conform tocurrent year presentations, we have reclassified certain circulationrevenues and expenses related to discounts, promotions and carriercompensation for the thirteen and twenty-six periods ended June26,  2005. The impact of the reclass was a decrease incirculation revenues offset entirely by a decrease in operatingexpenses.

Results of Operations

Thirteen Week PeriodEnded June  25,  2006 as Compared to the Thirteen WeekPeriod Ended June  26,2005

Summary.    Net income for the thirteen weekperiod ended June  25,  2006 was $9.8  million, or$0.25 per diluted share, versus $15.4  million, or $.37 perdiluted share, for the thirteen week period ended June26,  2005. Our 2006 second quarter reported net income includes a$2.5  million charge, net of applicable taxes, for costs relatedto a non-recurring non-compete/separation arrangement(‘‘special charge’’) which we entered intowith a former senior executive. Absent this charge, comparable resultswould have been $12.3  million or $0.31 per diluted share for thethirteen week period ending June  25,  2006.

Revenues.    For the thirteen week period endedJune  25,  2006, our total revenues decreased $3.7million, or 2.5 percent, to $142.2  million. Newspaper revenuesfor the thirteen weeks ended June  25,  2006 as compared tothe prior year period decreased $4.0  million, or 2.8 percent, to$137.0  million. Advertising revenues decreased 2.7 percent to$111.9  million, as compared to $115.0  million for thesecond quarter of 2005. Advertising revenues for the 2006 periodbenefited from the acquisitions of JobsInTheUS and Suburban Lifestyles,which added an aggregate of $1.7  million to the thirteen weekperiod. Circulation revenues, net of applicable discounts, for thethirteen week period ended June  25,  2006 decreasedapproximately $0.8  million, or 3.2 percent, as compared to theprior year period. Commercial printing and other revenues for thethirteen weeks ended June  25,  2006 increased byapproximately $0.2  million, or 5.1 percent, to $5.1million as compared to the prior year period. Online revenues, whichare included in advertising revenue, for the thirteen week period endedJune  25,  2006 were $4.1  million, an increase of37.2 percent compared to the prior year.

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The following table sets forth our totaladvertising revenues, by category, for the thirteen weeks endedJune  25,  2006 and June  26,2005:

|                          |  |  |                    |   |         |                 |  |  |           |   |         |  |  |  |  |  |     |  |
|--------------------------|--|--|--------------------|---|---------|-----------------|--|--|-----------|---|---------|--|--|--|--|--|-----|--|
|                     |  |  | ThirteenWeeksEnded |
| (Inthousands)            |  |  | June  25,2006      |   |         | June  26,  2005 |  |  | %Decrease |
| Local                    |  |  |                    | $ | 61,340  |                 |  |  |           | $ | 62,214  |  |  |  |  |  | 1.4 |  |
| Classified               |  |  |                    |   | 45,592  |                 |  |  |           |   | 47,534  |  |  |  |  |  | 4.1 |  |
| National                 |  |  |                    |   | 4,964   |                 |  |  |           |   | 5,263   |  |  |  |  |  | 5.7 |  |
| Totaladvertisingrevenues |  |  |                    | $ | 111,896 |                 |  |  |           | $ | 115,011 |  |  |  |  |  | 2.7 |  |
|                          |

Advertisingrevenues decreased $3.1  million, or 2.7 percent, which waslargely a result of decreases in classified advertising and nationaladvertising revenues of 4.1 percent and 5.7 percent, respectively.Local advertising decreased $0.9  million or 1.4 percentprimarily due to softness in the Michigan and Greater Clevelandclusters, offset partially by strong performances in the Mid-Hudson NewYork and Philadelphia clusters as compared to the prior year quarter.The decrease in classified advertising revenues was widely based, withsix of our seven clusters reporting decreases. Our New England clusterposted a gain in classified advertising, which was driven by anincrease in online revenue from JobsInTheUS, which was acquired inDecember  2005. Classified real estate advertising revenuesincreased 0.5 percent in the quarter as compared to the second quarterof last year while classified automotive advertising revenues remainedsoft in all of our clusters, and were down 19.1 percent for the quarteras compared to the prior year quarter. National advertising increasedby 7.4% in the Michigan cluster, as compared to the prior yearquarter, but this gain was largely offset by a decrease in theConnecticut cluster.

Salaries and employeebenefits.    Salaries and employee benefit expenses were 41.1percent of our revenues for the thirteen week period ended June25,  2006, as compared to 38.0 percent for the thirteen weekperiod ended June  26,  2005. Salaries and employeebenefits increased $3.0  million, or 5.5 percent, for thethirteen week period ended June  25,  2006 to $58.4million, as compared to $55.4  million in the prior year period.This increase was primarily due to the special charge of $3.6million. On a same-store basis, excluding the special charge, salariesand benefits decreased $1.5  million, or 2.7 percent, for thethirteen weeks ended June  25,  2006 as compared to theprior year period. The decrease in salaries and employee benefits inthe current period as compared to the prior year period is primarilydue to lower head count and a decrease in the cost of corporateincentives.

Newsprint, ink and printingcharges.    For the thirteen week period ended June25,  2006, newsprint, ink and printing charges were 9.3 percentof our revenues, as compared to 8.9 percent for the thirteen weekperiod ended June  26,  2005. Newsprint, ink and printingcharges for the thirteen week period ended June  25,  2006increased approximately $0.3  million, or 2.3 percent, to$13.3  million as compared to $13.0  million for thethirteen week period ended June  26,  2005. Our newsprintexpense increased approximately 5.0 percent for the thirteen weekperiod ended June  25,  2006 as compared to the prior yearperiod, reflecting an increase in unit cost of approximately 12.0percent on a comparable basis, partially offset by a decrease inconsumption of 6.0 percent.

Selling, general andadministrative.    Selling, general and administrative expenseswere 14.3 percent and 13.4 percent of our revenues for the thirteenweek periods ended June  25,  2006 and June26,  2005, respectively. As compared to the prior year period,selling, general and administrative expenses for the thirteen weekperiod ended June  25,  2006 increased $0.7  million,or 3.5 percent, to $20.3  million. The majority of the increaseis related to certain costs incurred in connection with the specialcharge, which was partially offset by a reduction in costs incurred forSection 404 of the Sarbanes-Oxley Act of 2002(‘‘Sarbanes-Oxley 404’’) compliance work inthe current year. Excluding increases due to acquisitions, selling,general and administrative expenses on a same-store basis, for thethirteen week period ended June  25,  2006 increased$0.2  million, or 1 percent.

Depreciation andamortization.    Depreciation and amortization expenses were3.4 percent and 3.3 percent of our revenues for the thirteen weekperiods ending June  25,  2006 and June  26,2005, respectively. Depreciation and amortization expenses for thethirteen week period ended June  25,  2006 increasedapproximately $40  thousand, or 0.8 percent, to $4.8million.

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Other expenses.    Otherexpenses, primarily related to promotion, circulation and delivery,were 13.1 percent and 12.5 percent of our revenues for the thirteenweek periods ended June  25,  2006 and June26,  2005, respectively. Other expenses increased approximately$0.5  million, or 2.8 percent, to $18.7  million as aresult of increased gasoline and delivery expenses for the thirteenweek period ended June  25,  2006.

Operatingincome.    Operating income was $26.7  million, or 18.8percent of our revenues, for the thirteen week period ended June25,  2006 as compared to $35.0  million, or 24.0 percent ofour revenues, for the thirteen week period ended June  26,2005 due to the items described above.

Net interest and otherexpense.    Net interest and other expense increasedapproximately $0.9  million, or 9.7 percent, for the thirteenweek period ended June  25,  2006 as compared to thethirteen week period ended June  26,  2005. Interestexpense increased in the thirteen week period ended June25,  2006 as a result of a 17.2 percent increase in the weightedaverage borrowing rate over the previous year period. This rateincrease was partially offset by a decrease in our outstanding debt ofapproximately $13.0  million over the prior year and a reductionin fees paid in connection with our borrowingagreements.

Provision for income taxes.    Theprovision for income taxes decreased by approximately $3.7million for the thirteen week period ended June  25,  2006as compared to the thirteen week period ended June  26,2005, reflecting a decrease in pretax net income. Our effective taxrate remained consistent at 39.25% for both the current andprior year period.

Twenty-Six Week Period Ended June25,  2006 as Compared to the Twenty-Six Week Period EndedJune  26,  2005

Summary.    Net incomefor the twenty-six week period ended June  25,  2006 was$11.5  million, or $0.29 per diluted share, versus $22.9million, or $0.54 per diluted share, for the period ended June26,  2005. Our 2006 first half reported net income includes a$2.5  million charge, net of applicable taxes, for costs relatedto the aforementioned special charge recorded during the second quarterand a $3.4  million charge, net of applicable taxes, related tothe repricing of our refinanced credit facility. Absent these charges,comparable results would have been $14.0  million or $0.35 perdiluted share for the twenty-six week period ending June25,  2006.

Revenues.    For the twenty-six weekperiod ended June  25,  2006, our revenues decreased$6.7  million, or 2.4 percent, to $271.8  million.Newspaper revenues for the twenty-six weeks ended June25,  2006 as compared to the prior year period decreased$6.8  million, or 2.5 percent, to $262.1  million.Advertising revenues for the twenty-six week period ended June25,  2006 decreased $5.4  million, or 2.5 percent, to$211.8  million as compared to $217.3  million for thetwenty-six week period ended June  26,  2005. Theacquisitions of JobsInTheUS and Suburban Lifestyles added an aggregateof $2.5  million to advertising revenues for the 2006 period.Circulation revenues for the twenty-six week period ended June26,  2005 decreased $1.4  million, or 2.7 percent, ascompared to the prior year period. Commercial printing and otherrevenues for the twenty-six weeks ended June  25,  2006increased by $0.2  million, or 1.6 percent, to $9.6million as compared to the prior year period and represented 3.5percent of our revenues for the twenty-six weeks ended June26,  2005. Online revenues, which are included in advertisingrevenue, for the twenty-six weeks ended June  25,  2006,were $7.4  million, an increase of 34.1 percent as compared tothe prior year period.

The following table sets forth our totaladvertising revenues, by category, for the twenty-six week periodsended June  25,  2006 and June  26,2005:

|                          |  |  |                       |   |         |               |  |  |           |   |         |  |  |  |  |  |     |   |
|--------------------------|--|--|-----------------------|---|---------|---------------|--|--|-----------|---|---------|--|--|--|--|--|-----|---|
|                     |  |  | Twenty-SixWeeks Ended |
| (Dollarsin thousands)    |  |  | June 25,2006          |   |         | June 26, 2005 |  |  | %Decrease |
| Local                    |  |  |                       | $ | 113,488 |               |  |  |           | $ | 116,392 |  |  |  |  |  | 2.5 | % |
| Classified               |  |  |                       |   | 88,149  |               |  |  |           |   | 90,289  |  |  |  |  |  | 2.4 | % |
| National                 |  |  |                       |   | 10,204  |               |  |  |           |   | 10,570  |  |  |  |  |  | 3.5 | % |
| Totaladvertisingrevenues |  |  |                       | $ | 211,841 |               |  |  |           | $ | 217,251 |  |  |  |  |  | 2.5 | % |
|                          |

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Advertising revenues decreased $5.4million, or 2.5% from the prior year period. Local advertisingdeclined $2.9  million or 2.5% primarily as a result ofweakness in local advertising in our Great Lakes clusters. Classifiedadvertising revenues decreased 2.4 percent for the twenty-six weeksended June  25,  2006, as compared to the twenty-six weeksended June  26,  2005. The decrease in classifiedadvertising revenues resulted from a 17.0 percent decrease inclassified automobile advertising revenues, which was partially offsetby a 5.6 percent increase in classified real estate advertisingrevenues. National advertising declined $0.4  million or3.5% primarily due to declines in our Connecticut cluster beingoffset by growth in our Michigan cluster.

Salaries andemployee benefits.    Salaries and employee benefit expenseswere 41.9 percent of our revenues for the twenty-six week period endedJune  25,  2006, as compared to 40.0 percent for thetwenty-six week period ended June  26,  2005. Salaries andemployee benefits increased $2.4  million, or 2.1 percent, forthe twenty-six week period ended June  25,  2006 to$113.7  million. Excluding increases due to acquisitions,salaries and employee benefits, on a same-store basis, increased$1.0  million, or 1.0 percent, for the twenty-six weeks endedJune  25,  2006 as compared to the prior year period. Theincrease in salaries and benefits is due primarily to the specialcharge of $3.6  million, which was partially offset by a decreaseattributable to reductions in headcount and incentive compensation,offset by increases in medical benefit expenses.

Newsprint,ink and printing charges.    For the twenty-six week periodended June  25,  2006, newsprint, ink and printing chargeswere 9.4 percent of our revenues, as compared to 8.8 percent for thetwenty-six week period ended June  26,  2005. Newsprint,ink and printing charges for the twenty-six week period endedJune  25,  2006 increased $1.1  million, or 4.6percent, as compared to the twenty-six week period ended June26,  2005. Our newsprint expense increased 6.5 percent for thetwenty-six week period ended June  25,  2006 as compared tothe prior year period on a same-store basis. Excluding the effects ofacquisitions, the increase in same-store newsprint expense is due to anincrease in unit costs of approximately 12.0 percent, partially offsetby a 5.0 percent decline in consumption, each on a comparablebasis.

Selling, general andadministrative.    Selling, general and administrative expenseswere 14.8 percent of our revenues in each of the twenty-six weekperiods ended June  25,  2006 and June  26,2005. As compared to the prior year period, selling, general andadministrative expenses for the twenty-six week period endedJune  25,  2006 decreased $1.1  million, or 2.8percent, to $40.1  million. This decrease was primarily due to areduction of professional fees for costs associated with the successfulcompletion of our internal control assessment and documentation forcompliance with Sarbanes-Oxley 404. These decreases were partiallyoffset by costs associated with promotional efforts related to ournewly acquired internet business, JobsInTheUS and the incurrence ofcertain costs related to the special charge we entered into in thesecond quarter of 2006. Excluding costs associated with acquisitions,selling, general and administrative expenses, on a same-store basis,for the twenty-six week period ended June  25,  2006decreased $1.9  million, or 4.7 percent, as a result of thedecrease in costs associated with Sarbanes-Oxley 404 and reductions incertain other selling, general and administrativeexpenses.

Depreciation andamortization.    Depreciation and amortization expense was 3.5percent of our revenues for each of the twenty-six week periods endedJune  25,  2006 and June  26,  2005.Depreciation and amortization expense for the twenty-six week periodended June  25,  2006 decreased $0.2  million, or 1.9percent, to $9.4  million as compared to the prior year period,primarily due to decreases in amortization expense associated withcertain intangible assets and depreciation of equipment under capitalleases. These reductions were offset by increases in depreciation onbuildings and equipment.

Other expenses.    Otherexpenses were 13.4 percent and 12.8 percent of our revenues for thetwenty-six week period ended June  25,  2006 and thetwenty-six week period ended June  26,  2005, respectively.Other expenses increased $0.8  million, or 2.4 percent, to$36.4  million in the twenty-six week period ended June26,  2005.

Operating income.    Operatingincome was $46.5  million, or 17.1 percent of our revenues, forthe twenty-six week period ended June  25,  2006 ascompared to $56.2  million, or 20.2 percent of our revenues, forthe twenty-six week period ended June  26,  2005.

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Net interest and otherexpense.    Net interest and other expense increased$3.3  million, or 17.7 percent, for the twenty-six week periodended June  25,  2006 as compared to the twenty-six weekperiod ended June  26,  2005. This increase during thetwenty-six weeks ended June  25,  2006 as compared to thetwenty-six weeks ended June  26,  2005 was primarily due tohigher interest expense, which resulted from higher prevailing interestrates. The effects of the higher rates were partially offset by areduction in fees associated with our credit agreements, as a result ofthe revised borrowing arrangement we entered into in the first quarterof this year and lower average debt outstanding during the period.

Write-off of debt issuance costs.    In connection withthe refinancing of our long-term debt, as discussed below, $5.7million, $3.4 million net of taxes, of unamortized debt issuance costsrelated to the old credit facility was written off in first quarter of2006 ended March  26,  2006.

Provision for incometaxes.    The provision for income taxes decreased $7.3million, or 49.5 percent, for the twenty-six week period endedJune  25,  2006 as compared to the twenty-six week periodended June  26,  2005, which was due to a decrease inpretax income.

Liquidity and Capital Resources

Ouroperations have historically generated strong positive cash flow. Webelieve that cash flows from operations and the availability of fundsfrom external sources will be sufficient to fund our ongoing operatingneeds, capital expenditure requirements and long-term debt obligations,and will provide us with the flexibility to pay quarterly dividends,finance our acquisition strategy and maintain our share repurchaseprogram.

Cash flows from operating activities.    Netcash provided by operating activities for the twenty-six week periodended June  25,  2006 was $37.3  million as comparedto $40.5  million for the twenty-six week period endedJune  26,  2005. Current assets were $91.0  millionand current liabilities were $91.1  million as of June25,  2006 as compared to current assets of $90.3  millionand current liabilities of $80.5 as of December  25,  2005.The increase in current liabilities primarily reflects areclassification of $7.5  million of current debt under our termloans, payable March  31,  2007. We manage our workingcapital through the utilization of our Revolving Credit Facility. Theoutstanding balance on the Revolving Credit Facility is classified as along-term liability, in accordance with its terms.

Cash flowsfrom investing activities.    Net cash used in investingactivities was $13.3  million for the twenty-six week periodended June  25,  2006. Net cash used in investingactivities for the twenty-six weeks ended June  25,  2006was for investments in property, plant and equipment and the purchaseof Suburban Lifestyles. Net cash used in investing activities was$4.2  million for the twenty-six week period ended June26,  2005, all of which was for property, plant and equipment. Wehave a capital expenditure program of approximately $30.0million in place for 2006, including approximately $10.0  millionrelated to a press for our Macomb, Michigan facility. Expendituresrelating to Macomb Press project totaled $1.9  million for thetwenty-six week period of 2006. Our 2006 capital expenditure programalso includes: spending on technology, including prepress and businesssystems; computer hardware and software; building and leaseholdimprovements; other machinery and equipment, and vehicles. We reviewour capital expenditure program periodically and modify it as requiredto meet current needs and believe that it is sufficient to maintain ourcurrent level and quality of operations.

Cash flows fromfinancing activities.    Net cash used in financing activitieswas $23.5  million for the twenty-six week period endedJune  25,  2006, which includes $13.9  million forpurchases of our common stock and $5.4  million of debtrepayment. Net cash used in financing activities was $35.0million for the twenty-six week period ended June  26,2005, of which $22.5  million was used to repay debt. OnFebruary  16,  2006, we announced that pursuant to Boardauthorization, we were continuing our share repurchase program.Repurchases of our common stock, in the aggregate amount of up to$25.0  million, may be made in open market or privatetransactions as market conditions dictate.

As disclosed in thenotes to our financial statements, on January  25,  2006,we amended and restated our existing Credit Agreement, datedAugust  12,  2004. Concurrent with this new agreement,

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we borrowed $625  million in Term Loansand $130.5  million in revolving credit loans under the AmendedCredit Agreement. These borrowings were used primarily to repay termloans and revolving credit loans outstanding under the former CreditAgreement.

The Amended Credit Agreement is an amendment andrestatement of the former Credit Agreement which was in effect fromAugust  12,  2004 until January  25,  2006 and,therefore, contains substantially similar terms as the former CreditAgreement. The amortization period for the Term Loans has been extendedand the commitment fees on the currently available and unused revolvingcredit loans have been reduced by 0.125 percentage points and theinterest rates on outstanding loans based on LIBOR have been reduced by0.25 percentage points to 0.50 percentage points, subject to the termsand conditions of the Amended Credit Agreement. The borrowingscurrently outstanding under the Amended Credit Agreement bear interestbased on either various Libor based Rates (determined daily) plus 1.00percent or the Prime Rate.

In connection with this refinancing,we wrote-off $5.7  million of deferred debt issuance costsassociated with the former Credit Agreement. This is reflected as acharge against our earnings in the Condensed Consolidated Statements ofIncome and as a non-cash item in the Condensed Consolidated Statementsof Cash Flows for the twenty-six period ending June  25,2006.

Pursuant to the terms of the Amended Credit Agreement, weare required to maintain specified financial ratios, and are alsosubject to specified operational limitations, including, among others,limitations on our ability to incur additional indebtedness, to makecertain fundamental company changes (such as mergers and dispositionsof assets), to authorize dividends and distributions on our capitalstock, and to undertake certain capital expenditures. The borrowingsare fully and unconditionally guaranteed by each of our subsidiaries.We and our guarantor subsidiaries have pledged substantially all of ourassets to secure the borrowings.

We are required under the termsof the Credit Agreement to maintain certain Interest Rate ProtectionAgreements (‘‘IRPAs’’) on a portion of ourdebt to reduce the potential exposure of our future cash flows tofluctuations in variable interest rates. The minimum requirement variesdepending on our Total Leverage Ratio, as defined in the Amended CreditAgreement. Pursuant to these requirements, we maintain and from time totime enter into new IRPAs consisting of (i) interest rate collars(‘‘Collars’’) that establish a baseinterest rate ceiling (‘‘Cap’’) and a baseinterest rate floor (‘‘Floor’’) and (ii)interest rate swaps (‘‘Swaps’’) in which weexchanges a portion of our floating rate debt for fixed rate debt, ineach case at no initial cost to us.

Our weighted averageeffective interest rate was approximately 5.7 percent for thetwenty-six week period ended June  25,  2006 andapproximately 4.5 percent for the twenty-six week period endedJune  26,  2005.

Reconciliation of Certain Non-GAAPFinancial Measures.

We believe that the use of certain non-GAAPfinancial measures enables us and our analysts, investors and otherinterested parties to evaluate and compare our results from operationsand cash resources generated from our business in a more meaningful andconsistent manner. Accordingly, this information has been disclosed inthis report to permit a more complete comparative analysis of ouroperating performance and capitalization relative to other companies inthe industry and to provide an analysis of operating results usingcertain principal measures used by our chief operating decision makersto measure the operating results and performance of us and ouroperations. We believe the use of EBITDA is appropriate given thegenerally predictable cash flow generated by our operations and theshort period of time it takes to convert new orders to cash. EBITDA isalso the basis of certain covenants contained in our CreditAgreement.

All EBITDA figures in this report are non-GAAPfinancial measures. We define EBITDA as net income plus provision forincome taxes, net interest expense, depreciation, amortization andother non-cash, special or non-recurring charges. For the thirteen weekperiod ended June  25,  2006, EBITDA was $35.6million as compared to $39.8  million for the thirteen weekperiod ended June  26,  2005. For the twenty-six weekperiod ended June  25,  2006, EBITDA was $60.0million as compared to $65.8  million for the twenty-six weekperiod ended June  26,  2005.

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These non-GAAP financial measures shouldnot be considered as alternatives to GAAP measures of performance, suchas operating income or net income. In addition, our calculations ofthese measures may or may not be consistent with the calculations ofthese measures by other companies. The table below providesreconciliations of the differences between: net income and EBITDA forthe thirteen and twenty-six week periods ended June  25,2006 and June  26,2005.

|                                             |  |  |                     |   |         |                       |  |  |               |   |         |                 |  |  |  |   |        |   |  |  |  |   |         |   |
|---------------------------------------------|--|--|---------------------|---|---------|-----------------------|--|--|---------------|---|---------|-----------------|--|--|--|---|--------|---|--|--|--|---|---------|---|
|                                        |  |  | Thirteenweeks ended |   |         | Twenty-six weeksended |
| (Inthousands, except per shareamounts)      |  |  | June 25, 2006       |   |         | June26, 2005(1)       |  |  | June 25, 2006 |   |         | June 26,2005(1) |
| Net income(1)                               |  |  |                     | $ | 9,778   |                       |  |  |               | $ | 15,372  |                 |  |  |  | $ | 11,543 |   |  |  |  | $ | 22,871  |   |
| Add:Provision for incometaxes               |  |  |                     |   | 6,318   |                       |  |  |               |   | 9,936   |                 |  |  |  |   | 7,459  |   |  |  |  |   | 14,771  |   |
| Add:Loss on write-off of debt issuancecosts |  |  |                     |   | — |                       |  |  |               |   | — |                 |  |  |  |   | 5,662  |   |  |  |  |   | — |   |
| Add:Net interest expense andother           |  |  |                     |   | 10,664  |                       |  |  |               |   | 9,350   |                 |  |  |  |   | 21,881 |   |  |  |  |   | 17,843  |   |
| Operatingincome                             |  |  |                     |   | 26,760  |                       |  |  |               |   | 34,658  |                 |  |  |  |   | 46,545 |   |  |  |  |   | 55,485  |   |
| Add:Depreciation andamortization            |  |  |                     |   | 4,781   |                       |  |  |               |   | 5,114   |                 |  |  |  |   | 9,422  |   |  |  |  |   | 10,352  |   |
| Add:Special items(2)                        |  |  |                     |   | 4,078   |                       |  |  |               |   | — |                 |  |  |  |   | 4,078  |   |  |  |  |   | — |   |
| EBITDA                                      |  |  |                     |   | 35,619  |                       |  |  |               |   | 39,772  |                 |  |  |  |   | 60,045 |   |  |  |  |   | 65,837  |   |
| EBITDAmargin                                |  |  |                     |   | 25.1    | %                     |  |  |               |   | 27.3    | %               |  |  |  |   | 22.1   | % |  |  |  |   | 23.6    | % |
|                                             |

Notes:

|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1) | Certain2005 circulation revenue and expense items have been reclassified toconform to the Company's current financial presentation. Theeffect of these reclassifications is to reduce revenues by $0.9million and $2.2  million for the thirteen and twenty-six weekperiods ended June  26,  2005, respectively, with an equaldecrease in operating expenses. In addition, the Company hasreclassified amortization of deferred financing fees from amortizationexpense to interest expense. These reclassifications have no impact onEBITDA or net income. |

|     |                                                                                                                                   |
|-----|-----------------------------------------------------------------------------------------------------------------------------------|
| (2) | Special itemsrelate to a non-recurring charge for a non-compete/separationarrangement entered into with a former seniorexecutive. |

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Item 3.    Quantitative andQualitative Disclosures About Market Risk

We are exposed tomarket risk arising from changes in interest rates associated with ourlong-term debt obligations. Our long-term debt is at variable interestrates based on the LIBOR, the Prime Rate or the Federal Funds Rate,plus a certain interest rate spread as defined in the Amended CreditAgreement. To manage our exposure to fluctuations in interest rates asrequired by our Credit Agreement, we enter into certain IRPAs on aportion of our debt, which reduces the effect of changes in variableinterest rates. Our objective with respect to these agreements is forhedging activities and not for trading or speculative activity.

At June  25,  2006, we had Collars in place with respectto an aggregate notional amount of $300  million of ouroutstanding indebtedness and Swaps with respect to an aggregatenotional amount of $225  million of our outstanding indebtedness.In addition, we had contracts for Collars that have effective datesoccurring in the future with respect to additional notional amounts.See Note 4 of Notes to Condensed Consolidated Financial Statements.There was no initial cost associated with our existing Collar or Swaparrangements. Assuming a 10 percent increase or reduction in variableinterest rates, the annual impact on our pre-tax earnings would beapproximately $3.7  million.

Newsprint, which is theprincipal raw material for our newspapers, is exposed to commodityprice changes. We seek to manage the effects of increases in the priceof newsprint through a combination of, among other things, technologyimprovements, including reductions in page size, inventory managementand advertising and circulation price increases.

Item4.    Controls and Procedures

We carried out an evaluation,under the supervision and with the participation of our management,including our Chief Executive Officer and Chief Financial Officer, ofthe effectiveness of the design and operation of our disclosurecontrols and procedures as of the end of the period covered by thisreport. Based upon that evaluation, the Chief Executive Officer andChief Financial Officer concluded that our disclosure controls andprocedures are effective in alerting them in a timely manner tomaterial information relating to our (including our businessconsolidated subsidiaries) required to be included in our periodicfilings with the SEC.

Our disclosure controls and procedures aredesigned to ensure that information required to be disclosed by us inthe reports that we file or submit under the Securities Exchange Act of1934 are recorded, processed, summarized and reported within the timeperiods specified in the SEC’s rules and forms. Disclosurecontrols and procedures include, without limitation, controls andprocedures designed to ensure that information required to be disclosedby us in the reports that we file under the Exchange Act is accumulatedand communicated to our management, including our Chief ExecutiveOfficer and Chief Financial Officer, as appropriate to allow timelydecisions regarding required disclosure.

During fiscal year 2004,we commenced the deployment of a new suite of software applications ina shared services environment. The new suite of applications includes:(i) financial applications, including accounts payable, general ledger,fixed assets, and consolidation and reporting; (ii) circulationmanagement applications; and (iii) advertising management applications.As deployed, the new software, together with the change to a sharedservices business model, further enhances our internal and disclosurecontrols and our operating efficiencies. As of June  25,2006, the implementation of the financial applications was largelycomplete and deployment of the advertising and circulation managementapplications was underway and is expected to be completed by 2008. Theimplementation of the financial applications has involved changes insystems that include internal controls, and accordingly, these changeshave required changes to our system of internal controls. We havereviewed each system as it is being implemented and the controlsaffected by the implementation of the new systems and made appropriatechanges to affected internal controls as the new systems wereimplemented. We believe that the controls as modified are appropriateand functioning effectively.

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PARTII.    OTHER INFORMATION

Item 1A.    RiskFactors

There are no material changes to the risk factorsdescribed in our Annual Report on Form 10-K for the fiscal year endedDecember  25,  2005.

Item 2.    Unregistered Salesof Equity Securities and Use of Proceeds

The followingtable provides information with respect to our purchases of JournalRegister Company common stock during the twenty-six weeks endedJune  25,  2006.

Purchases of EquitySecurities

|                                         |  |  |                                    |  |           |                                 |  |  |                                                                                    |   |       |                                                                                            |  |  |  |  |           |  |  |  |  |   |            |  |
|-----------------------------------------|--|--|------------------------------------|--|-----------|---------------------------------|--|--|------------------------------------------------------------------------------------|---|-------|--------------------------------------------------------------------------------------------|--|--|--|--|-----------|--|--|--|--|---|------------|--|
| Period                                  |  |  | (a)Total Number of SharesPurchased |  |           | (b)Average Price Paid per Share |  |  | (c) Total Number ofShares Purchased as Part of Publicly Announced Plans orPrograms |   |       | (d) Approximate Dollar Value of Shares thatMay Yet Be Purchased Under the Plans orPrograms |
| December  26,  2005 toJanuary  29,2006  |  |  |                                    |  | 155,500   |                                 |  |  |                                                                                    | $ | 15.12 |                                                                                            |  |  |  |  | 155,500   |  |  |  |  | $ | 10,198     |  |
| January30,  2006 to February  26,  2006 |  |  |                                    |  | 82,900    |                                 |  |  |                                                                                    | $ | 13.15 |                                                                                            |  |  |  |  | 82,900    |  |  |  |  | $ | 23,920,063 |  |
| February27,  2006 to March  26,2006     |  |  |                                    |  | 345,600   |                                 |  |  |                                                                                    | $ | 12.52 |                                                                                            |  |  |  |  | 345,600   |  |  |  |  | $ | 19,594,188 |  |
| TotalFirst Quarter2006                  |  |  |                                    |  | 584,000   |                                 |  |  |                                                                                    | $ | 13.30 |                                                                                            |  |  |  |  | 584,000   |  |  |  |  | $ | 19,594,188 |  |
| March27,  2006 to April  30,2006        |  |  |                                    |  | 220,300   |                                 |  |  |                                                                                    | $ | 11.58 |                                                                                            |  |  |  |  | 220,300   |  |  |  |  | $ | 17,043,246 |  |
| May1,  2006 to May  28,2006             |  |  |                                    |  | 212,037   |                                 |  |  |                                                                                    | $ | 10.83 |                                                                                            |  |  |  |  | 212,037   |  |  |  |  | $ | 14,747,578 |  |
| May29,  2006 to June  25,2006           |  |  |                                    |  | 128,300   |                                 |  |  |                                                                                    | $ | 9.83  |                                                                                            |  |  |  |  | 128,300   |  |  |  |  | $ | 13,486,619 |  |
| TotalSecond Quarter2006                 |  |  |                                    |  | 560,637   |                                 |  |  |                                                                                    | $ | 10.89 |                                                                                            |  |  |  |  | 560,637   |  |  |  |  | $ | 13,486,619 |  |
| TotalYear to Date2006                   |  |  |                                    |  | 1,144,637 |                                 |  |  |                                                                                    | $ | 12.12 |                                                                                            |  |  |  |  | 1,144,637 |  |  |  |  | $ | 13,486,619 |  |
|                                         |

Allof the shares included in column (c) above were repurchased pursuant toa program initially announced on January  13,  1999,whereby our Board of Directors authorized the use of up to $100million per year for the repurchase of our Common Stock. OnApril  19,  2005, we announced that, pursuant to Boardauthorization, we were recommencing our share repurchase program forthe repurchase of our common stock in an aggregate amount of up to$30  million. We completed the $30  million sharerepurchase program and on February  16,  2006 again,pursuant to Board authorization, we are continuing our share repurchaseprogram for additional repurchases of our common stock in the aggregateamount of $25  million. There is no expiration date for therepurchase program. Since January  13,  1999, and as ofJuly  25,  2006, we have repurchased an aggregate of10,471,937 shares at an average price of $14.59 per share.

Weconduct our operations through direct and indirect subsidiaries. Ouravailable cash will depend upon the cash flow of our subsidiaries andthe ability of such subsidiaries to make funds available to us in theform of loans, dividends or otherwise. The subsidiaries are separateand distinct legal entities and have no legal obligation, contingent orotherwise, except as required by the Credit Agreement, to make fundsavailable to us, whether in the form of loans, dividends or otherwise.The Credit Agreement is secured by substantially all of our assets andthe Common Stock and assets of our subsidiaries. In addition, oursubsidiaries may, subject to limitations contained in the CreditAgreement, become parties to financing arrangements that may containlimitations on the ability of such subsidiaries to pay dividends or tomake loans or advances to us. In the event of any insolvency,bankruptcy or similar proceeding of a subsidiary, creditors of suchsubsidiary would generally be entitled to priority over us with respectto assets of the affected subsidiary.

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Item 4.    Submission of Matters to aVote of Security Holders

The Company held its Annual Meeting ofStockholders on May  3,  2006. At the Annual Meeting, thestockholders elected Robert M.  Jelenic and John L. Vogelstein asClass C directors of the Company to hold office until the 2009 AnnualMeeting of Stockholders. The stockholders also ratified the appointmentof Grant Thornton LLP as independent auditors for the Company forfiscal year 2006.

Each of the Class C directors nominated by theCompany was elected with the following votingresults:

|                   |  |  |          |  |            |               |  |  |  |  |           |  |
|-------------------|--|--|----------|--|------------|---------------|--|--|--|--|-----------|--|
|              |  |  | VOTESFOR |  |            | VOTESWITHHELD |
| RobertM.Jelenic   |  |  |          |  | 32,077,118 |               |  |  |  |  | 3,549,344 |  |
| John L.Vogelstein |  |  |          |  | 31,035,837 |               |  |  |  |  | 4,590,625 |  |
|                   |

Theother proposal submitted to the stockholders was approved with thefollowing voting results:

|                                                                                                                                    |  |  |              |  |            |                  |  |  |             |  |        |  |  |  |  |  |        |  |
|------------------------------------------------------------------------------------------------------------------------------------|--|--|--------------|--|------------|------------------|--|--|-------------|--|--------|--|--|--|--|--|--------|--|
|                                                                                                                               |  |  | VOTESCASTFOR |  |            | VOTESCASTAGAINST |  |  | ABSTENTIONS |
| Ratify the appointmentof Grant Thorton LLP as the Company’s independent registeredpublic accounting firm for fiscal year2006 |  |  |              |  | 35,586,130 |                  |  |  |             |  | 30,232 |  |  |  |  |  | 10,100 |  |
|                                                                                                                                    |

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Item 6.    Exhibits

|  |    |    |  |  |  |                                                                                                                                                                                      |
|--|----|----|--|--|--|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  | 31 | .1 |  |  |  | Certificationof Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, asadopted pursuant to Section 302 of the Sarbanes-Oxley Act of2002.                                 |
|  | 31 | .2 |  |  |  | Certification of PrincipalFinancial Officer, pursuant to 18 U.S.C. Section 1350, as adoptedpursuant to Section 302 of the Sarbanes-Oxley Act of2002.                                 |
|  | 32 |    |  |  |  | Certification of PrincipalExecutive Officer and Principal Financial Officer, pursuant to 18U.S.C. Section 1350, as adopted pursuant to Section 906 of theSarbanes-Oxley Act of 2002. |
|  |

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SIGNATURE

Pursuant to therequirements of the Securities Exchange Act of 1934, the registrant hasduly caused this report to be signed on its behalf by the undersignedhereunto duly authorized.

Date: August  04,2006                                        JOURNALREGISTER COMPANY

|  | By: /s/ Julie A.Beck                           |
|--|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | JulieA. BeckSenior Vice President andChief Financial Officer(signing on behalf of the registrantand as principal financialofficer) |
|--|------------------------------------------------------------------------------------------------------------------------------------|

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