##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 20-F







| ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------------

OR



|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For fiscal year ended August 31, 2015

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from
 to

OR



| ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------

Commission file number: 333-174780





POSTMEDIA
NETWORK CANADA CORP.

(Exact names of registrants as specified in their charters)





N/A

(Translation of
registrants name into English)

Postmedia Network Canada Corp.

Canada

(Jurisdiction of
incorporation or organization)

98-0667225

(I.R.S. Employer Identification No.)







365 Bloor Street East, 12th Floor

Toronto, Ontario Canada M4W 3L4

(416) 383-2300

(Address, of each of the registrants principal executive offices)





Douglas Lamb, Executive Vice President and Chief Financial Officer

365 Bloor Street East, 12th Floor

Toronto, Ontario Canada M4W 3L4

Phone: (416) 383-2300 Fax: (416) 443-6046

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)





Securities registered or to be registered pursuant to Section 12(b) of the Act.

None

Securities for
which there is a reporting obligation pursuant to Section 15(d) of the Act.

None

(Title of Class)





Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of
the period covered by the annual report.

1,040,153 Class C voting shares and 280,141,692 Class NC variable voting shares outstanding as
of August 31, 2015

Indicate by check mark if the registration is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act     ̈  Yes    x  No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934.    x  Yes     ̈  No

Note  Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

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 file such reports),
and (2) has been subject to such filing requirements for the past 90
days.     ̈  Yes    x  No

Indicate by check mark whether the registrant is a large accelerated filer, or a non-accelerated filer. See definition of
accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act.

Large accelerated filer   ̈                 Accelerated
filer   ̈                 Non-accelerated
filer  x

Indicate by check mark which basis of accounting the
registrant has used to prepare the financial statements included in this filing:



|             |  |                                                                                                          |  |         
|------------ |  | -------------------------------------------------------------------------------------------------------- |  | --------
| ̈  U.S. GAAP |  | x  International Financial Reporting Standards
as issued by the International Accounting Standards Board |  |  ̈  Other

If Other has been checked in response to the previous question, indicate by check
mark which financial statement item the registrant has elected to follow.    Item 17.   ̈    Item 18.   ̈

If this is an annual report, indicate by check mark whether the Company is a
shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes   ̈    No  x









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TABLE OF CONTENTS



|                                                                                     |  |  |    | 
|------------------------------------------------------------------------------------ |  |  | -- | 
|General Information                                                                  |  |  | 1  | 
|Notice Regarding Forward Looking Statements                                          |  |  | 5  | 
|Notice Regarding Presentation of Financial Information                               |  |  | 7  | 
|Part I                                                                               |  |  | 8  | 
|Item 1. Identity of Directors, Senior Management and Advisors                        |  |  | 8  | 
|Item 2. Offer Statistics and Expected Timetable                                      |  |  | 8  | 
|Item 3. Key Information                                                              |  |  | 8  | 
|Item 4. Information on the Company                                                   |  |  | 10 | 
|Item 4A. Unresolved Staff Comments                                                   |  |  | 25 | 
|Item 5. Operating and Financial Review and Prospects                                 |  |  | 25 | 
|Item 6. Directors, Senior Management and Employees                                   |  |  | 26 | 
|Item 7. Major Shareholders and Related Party Transactions                            |  |  | 64 | 
|Item 8. Financial Information                                                        |  |  | 65 | 
|Item 9. The Offer and Listing                                                        |  |  | 66 | 
|Item 10. Additional information                                                      |  |  | 67 | 
|Item 11. Quantitative and Qualitative Disclosures About Market Risk                  |  |  | 82 | 
|Item 12. Description of Securities Other than Equity Securities                      |  |  | 82 | 
|Part II                                                                              |  |  | 82 | 
|Item 13. Defaults, Dividend Arrearages and Delinquencies                             |  |  | 82 | 
|Item 14 Material Modifications to the Rights of Security Holders and Use of Proceeds |  |  | 82 | 
|Item 15. Controls and Procedures                                                     |  |  | 82 | 
|Item 15T. Controls and Procedures                                                    |  |  | 84 | 
|Item 16A. Audit Committee Financial Expert                                           |  |  | 84 | 
|Item 16B. Code of Ethics                                                             |  |  | 84 | 
|Item 16C. Principal Accountant Fees and Services                                     |  |  | 85 | 
|Item 16D. Exemptions From the Listing Standards for Audit Committees                 |  |  | 85 | 
|Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers     |  |  | 85 | 
|Item 16F. Change in Registrants Certifying Accountant                                |  |  | 85 | 
|Item 16G. Corporate Governance                                                       |  |  | 85 | 
|Item 16H. Mine Safety Disclosure                                                     |  |  | 85 | 
|Part III                                                                             |  |  | 86 | 
|Item 17. Financial Statements                                                        |  |  | 86 | 
|Item 18. Financial Statements                                                        |  |  | 86 | 
|Item 19. Exhibits                                                                    |  |  | 86 | 



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GENERAL INFORMATION

Unless otherwise indicated, all references herein are to Canadian dollars.

Capitalized terms, except as otherwise defined herein, are defined in the section entitled Glossary of Terms.

Except as otherwise indicated or the context otherwise requires in this annual report, for periods prior to the Acquisition, references to the
Corporation, the Company, we, us and our refer to Canwest LP and its consolidated subsidiaries; and for periods following the Acquisition, those terms
refer to Postmedia Network Canada Corp. and, if the context requires, Postmedia Network Inc.

The Corporation was incorporated under the
Canada Business Corporations Act, which is referred to as the CBCA. The Corporations principal executive offices are located at 365 Bloor Street East, 12th Floor,
Toronto, Ontario, Canada, M4W 3L4 and its telephone number at that address is (416) 383-2300. The Corporations website is located at http://www.postmedia.com. Information about the Corporation is included on its website. The
Corporations website and the information contained on its website are not part of this report.

Glossary of Terms

In this annual report, the following terms will have the meanings set forth below, unless otherwise indicated. Words importing the singular
include the plural and vice versa and words importing any gender include all genders.

ABL Collateral means the
accounts receivable, cash and cash equivalents, inventory and related assets of Postmedia Network Inc. and Postmedia Network Canada Corp., which constitute collateral for the ABL Facility on a first-priority basis, for the First-Lien Notes on a
second-priority basis and for the Second-Lien Notes on a third-priority basis.

ABL Facility has the meaning ascribed
to such term in Item 10.C Material Contracts  ABL Facility.

Acquisition has the meaning
ascribed to such term in Item 4.A History and Development of the Company - Acquisition.

Acquisition
Consideration has the meaning ascribed to such term in Item 4.A History and Development of the Company - Acquisition.

annual report means this annual report on Form 20-F.

Board means the board of directors of Postmedia Network Canada Corp.

Business Day means a day on which banks are open for business in Toronto, but does not include a Saturday, Sunday or a
holiday in the Province of Ontario.

Canso has the meaning ascribed to such term in Item 4.A History and
Development of the Company  Significant Post-Acquisition Events.

CBCA means the Canada Business Corporations Act.

CCAA means the Companies Creditors Arrangement Act (Canada).

Canwest Global means Canwest Global Communications Corp., a corporation incorporated under the laws of Canada and the
indirect parent company of Canwest LP.



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Canwest LP means the Canwest Limited Partnership/Canwest Societe en
Commandite, a limited partnership formed under the laws of the province of Ontario whose general and limited partnership interests were owned by Canwest (Canada) Inc. and 4501071 Canada Inc., respectively, together with its subsidiaries.

Conversion Restriction Agreement has the meaning ascribed to such term under Item 7. Major Shareholders and
Related Party Transactions.

Disposed Properties has the meaning ascribed to such term in
Item 4.A History and Development of the Company  Significant Post-Acquisition Events.

dollars or $ means Canadian dollars.

DSU means a right to receive, on a deferred basis, an amount of money subject to and in accordance with the terms of the
DSU Plan, credited to a Member (as such term is defined in the DSU Plan) and reflected as an entry in a Members DSU Account (as such term is defined in the DSU Plan) in accordance with the DSU Plan.

DSU Plan means the deferred share unit plan of the Corporation dated as of July 13, 2010, as amended thereafter.

EDGAR means the Electronic Data-Gathering, Analysis and Retrieval system of the US Securities and Exchange Commission.

Equity Subscription Receipts has the meaning ascribed to such term in Item 4.A History and Development of the
Company  Significant Post-Acquisition Events.

First-Lien Notes means the 8.25% Senior Secured
Notes due 2017 issued by Postmedia Network Inc. on August 16, 2012 pursuant to the terms and conditions of the First-Lien Notes indenture.

First-Lien Notes Collateral means substantially all the assets of Postmedia Network Inc. and Postmedia Network Canada Corp.
(other than ABL Collateral) and certain customary exclusions, which constitutes collateral for the First-Lien Notes on a first-priority basis, Second-Lien Notes on a second-priority basis and for the ABL Facility on a third-priority basis.

Fiscal means the twelve month period ending on August 31 of such year.

Glacier Transaction has the meaning ascribed to such term in Item 4.A History and Development of the Company
 Significant Post-Acquisition Events.

GoldenTree means GoldenTree Asset Management LP.

IFRS means generally accepted accounting principles in accordance with Part I of the Handbook of the Canadian
Institute of Chartered Accountants. IFRS as applied by the Corporation is in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.

LP Entities means Canwest Publishing Inc./Publications Canwest Inc., Canwest Books Inc., Canwest (Canada) Inc. and Canwest
LP.

MD&A means Postmedia Network Canada Corps managements discussion and analysis for the years ended
August 31, 2015, 2014 and 2013, attached hereto as Exhibit 15.2.

National Post means the daily national
newspaper published by the Corporation.

Non-Canadian has the meaning ascribed to such term in Item 10.B
Memorandum and Articles of Association  Voting Shares.



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Notes Subscription Receipts has the meaning ascribed to such term in
Item 4.A History and Development of the Company  Significant Post-Acquisition Events.

Option means the right to purchase Voting Shares or Variable Voting Shares, as applicable, under the Option Plan.

Option Plan means the stock option plan of the Corporation dated as of July 13, 2010.

Plan has the meaning ascribed to such term in Item 4.A History and Development of the Company -
Acquisition.

Postmedia means Postmedia Network Canada Corp. and, if the context requires, its
subsidiary, Postmedia Network Inc.

Postmedia Rights Plan means the Shareholder rights plan agreement entered
into between Postmedia and Computershare Investor Services Inc., as rights agent.

Prospectus means the Canadian
non-offering prospectus filed by Postmedia on June 7, 2011.

Purchase Agreement has the meaning ascribed to such
term in Item 4.A History and Development of the Company  Significant Post-Acquisition Events.

QMI has the meaning ascribed to such term in Item 4.A History and Development of the Company  Significant
Post-Acquisition Events.

QMPI has the meaning ascribed to such term in Item 4.A History and
Development of the Company  Significant Post-Acquisition Events.

Qualifying Public Corporation
has the meaning ascribed to such term in Item 4.B Business Overview  Regulation.

Rights
Offering has the meaning ascribed to such term in Item 4.A History and Development of the Company  Significant Post-Acquisition Events.

SEC means the U.S. Securities and Exchange Commission.

Sarbanes-Oxley means the U.S. Sarbanes-Oxley Act of 2002.

Second-Lien Notes means the 12.50% Senior Secured Notes due 2018 issued by Postmedia Network Inc. pursuant to the terms and
conditions of the Second-Lien Notes indenture.

SEDAR means the System for Electronic Data Analysis and Retrieval
operated by the Canadian Securities Administrators.

Shareholder means both registered and non-registered owners of the
Shares.

Shares means, collectively, the Voting Shares and the Variable Voting Shares.

Standby Purchase Agreement has the meaning ascribed to such term in Item 7. Major Shareholders and Related Party
Transactions.

Subscription Agreement has the meaning ascribed to such term in Item 4.A
History and Development of the Company - Significant Post-Acquisition Events.

Subscription Receipt
Indenture has the meaning ascribed to such term in Item 4.A History and Development of the Company - Significant Post-Acquisition Events.



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Sun Acquisition has the meaning ascribed to such term in Item 4.A
History and Development of the Company - Significant Post-Acquisition Events.

Tax Act means the Income
Tax Act (Canada).

Term Loan Facility means the previous Senior Secured Term Loan Credit Facility of Postmedia
Network Inc. entered into on July 13, 2010.

Toronto Head Office has the meaning ascribed to such term in
Item 4.A History and Development of the Company - Incorporation.

TSX means the Toronto Stock
Exchange.

US$ and US dollars means United States dollars.

Variable Voting Shares means the Class NC variable voting shares in the capital of the Corporation which trade on the TSX
under the symbol PNC.B.

Voting Shares means the Class C voting shares in the capital of the Corporation which trade on
the TSX under the symbol PNC.A.



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NOTICE REGARDING FORWARD LOOKING STATEMENTS

This annual report includes statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections
regarding future events or future results, and therefore are, or may be deemed to be, forward-looking statements. These forward-looking statements can generally be identified by the use of forward-looking terminology, including
the terms believes, estimates, anticipates, expects, seeks, projects, intends, plans,
may, will, could or should or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include all matters that are not
historical facts. They appear in a number of places throughout this annual report and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition,
liquidity, prospects, growth, strategies, expenditures, costs and the industry in which we operate. These statements reflect managements current beliefs with respect to future events and are based on information currently available to
management. Forward-looking statements involve significant known and unknown risks, uncertainties and assumptions. Many factors could cause the Corporations actual results, performance or achievements to be materially different from any future
results, performance or achievements that may be expressed or implied by such forward-looking statements, including, without limitation, those listed in the Risk Factors section of the MD&A, attached hereto as
Exhibit 15.2. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements could vary materially from those
expressed or implied by the forward-looking statements contained in this annual report. Such risks include, but are not limited to: competition from digital and other forms of media; the Corporations ability to compete successfully in
newspaper and online industries; the influence of prevailing economic conditions and the prospects of the Corporations advertising customers on advertising revenue; the failure to fulfill the Corporations strategy of building its digital
media and online businesses; failure to maintain print and online newspaper readership and circulation levels; the negative impact of decreases in advertising revenue on results of operations; financial difficulties of certain contractors and
vendors; competition with alternative emerging technologies; not being able to achieve a profitable balance between circulation levels and advertising revenues; not realizing anticipated cost savings from cost savings initiatives; seasonal
variations in revenue; intellectual property rights; damage to the Corporations reputation; variations in the cost and availability of newsprint; disruptions in information systems and technology and other manufacturing systems; labour
disruptions; equipment failure; environmental, health and safety laws and regulations; controversial editorial content; unresolved litigation matters; failure to comply with Canadian Newspaper status for purposes of the Tax Act;
the collectability of accounts receivable; goodwill and intangible asset impairment charges; disruptions in the credit markets; changes to the availability and terms of insurance policies; under-funded registered pension plans; changes in pension
fund investment performance; foreign exchange fluctuations; increases in distribution costs due to increases in fuel prices; outsourcing certain aspects of the business to third-party vendors; retaining and attracting sufficient qualified personnel;
increases in sales and other taxes; the occurrence of natural or man-made disasters; failure to comply with the Sarbanes-Oxley Act; failure to maintain effective internal controls; change of laws;
security breaches and other disruptions could compromise information and expose the Corporation to liability; risks related to the assets acquired in the Sun Acquisition and the integration of those assets; the substantial indebtedness of the
Corporation and the possibility that it may be able to incur substantially more debt which could adversely affect its financial condition; the Corporation did not refinance its ABL Facility; the terms of the indentures that govern the First-Lien
Notes and Second-Lien Notes, may restrict the Corporations current and future operations; the possibility that the Corporation will not be able to generate sufficient cash to service all of its indebtedness; the lack of an active public market
for the Shares; volatility of the market price for Shares; dual class share structure; Postmedia Network Canada Corp. having a holding company structure; risks relating to the future sales of Shares by directors and officers and risks relating to
dilution. See the section entitled Risk Factors in the Corporations MD&A dated October 21, 2015, attached hereto as Exhibit 15.2 and which is available on SEDAR at www.sedar.com and EDGAR for a complete
description of risks relating to an investment in the Corporation. These risk factors are incorporated in this annual report by reference. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and
depend on circumstances that may or may not occur in the future. These risk factors should not be construed as exhaustive and should be read with the other cautionary statements in this annual report and with the risk factors described in the
MD&A.



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These risk factors should be considered carefully and readers should not place undue reliance on
the forward-looking statements. Although the Corporation bases its forward-looking statements on assumptions that it believes were reasonable when made, which assumptions include, but are not limited to, the Corporations future growth
potential, results of operations, future prospects and opportunities, execution of the Corporations business strategy, a stable workforce, no material variations in the current tax and regulatory environments, future levels of indebtedness and
the ability to achieve future cost savings, the Corporation cautions the reader that forward-looking statements are not guarantees of future performance and that the Corporations actual results of operations, financial condition and liquidity,
and the development of the industry in which the Corporation operates, may differ materially from those made in or suggested by the forward-looking statements contained in this annual report. In addition, even if the Corporations results of
operations, financial condition and liquidity, and the development of the industry in which it operates are consistent with the forward-looking statements contained in this annual report, those results or developments may not be indicative of
results or developments in subsequent periods.

Any forward-looking statements which are made in this annual report speak only as of the
date of such statement, and the Corporation does not undertake, and specifically declines, except as required by applicable law, any obligation to update such statements or to publicly announce the results of any revisions to any such statements to
reflect future events or developments. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical
data. All of the forward-looking statements made in this annual report are qualified by these cautionary statements.

The Corporation owns
or has rights to use the trademarks, service marks and trade names that it uses in connection with its business, such as Postmedia Network, Infomart and National Post. Each trademark, service mark and trade name of any other company appearing in
this annual report is to the Corporations knowledge, owned by such other company. Solely for convenience, the trademarks, service marks and trade names referred to in this annual report are listed without the ® and  symbols, but such references are not intended to indicate in any way that the Corporation will not assert, to the fullest extent under applicable law, its rights or the rights of the
applicable licensors to these trademarks, service marks and trade names.

Industry Information

This annual report includes market share, ranking, industry data and forecasts that the Corporation obtained from industry publications,
surveys, public filings, documents and internal sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to
the accuracy or completeness of included information. The Corporation has not independently verified any of the data from third-party sources nor has it ascertained the underlying economic assumptions relied upon therein.

Unless otherwise stated herein:



| |  |  | individual newspaper circulation figures were obtained from the Alliance for Audited Media (AAM), the Canadian Media Circulation
Audit (CMCA) and the Canadian Circulations Audit Board (CCAB), which are independent audit organizations that audit the circulation of print media entities, including newspapers;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | information regarding industry-wide newspaper circulation revenue and circulation were obtained from Newspapers Canada, a partnership between the
Canadian Newspaper Association and the Canadian Community Newspaper Association, which are not-for-profit industry associations representing publishers of Canadian daily newspapers and weekly newspapers, respectively. The Circulation Data Report,
prepared by Newspapers Canada, calculates circulation levels based on data provided by AAM, CMCA and CCAB reports. No single publication schedule applies across the Canadian newspaper industry. Therefore, in the Circulation Data Report, Newspapers
Canada makes further calculations based on AAM, CMCA and CCAB data to derive industry-wide figures;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | newspaper readership information was obtained from the eMarketer Global Media Report, and Vividata (Vividata), the amalgamated
organization of NADbank Inc. and Print Measurement Bureau (PMB), a not-for-profit research association of publishers, agencies and advertisers that provides audience measurement for magazines and newspapers to its members; and
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | digital audience measurement information was obtained from comScore Media Metrix, the audience measurement division of comScore, Inc.
(comScore), which defines total unique visitors, a measure that the Corporation cites throughout this document, as the estimated number of different individuals (in thousands) that visited any content
of a website or mobile platform (smartphone/tablet), a category, a channel, or an application during the reporting period.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Statements as to the Corporations market position and ranking are based in part on market data currently available to it and
managements estimates and assumptions that have been made regarding the size of its markets within its industry. The Corporation believes data regarding the size of the markets and market share are inherently imprecise, but generally indicate
size and position and market share within its markets. Although the Corporation is not aware of any misstatements regarding the industry data presented herein, the estimates involve risks and uncertainties and are subject to change based on various
factors, including those discussed under the section entitled Risk Factors in the Corporations MD&A dated October 21, 2015, attached hereto as Exhibit 15.2. The Corporation cannot guarantee the accuracy or
completeness of such information contained in this annual report.

NOTICE REGARDING PRESENTATION OF FINANCIAL
INFORMATION

The financial statements included in this annual report are presented in Canadian dollars. In this annual report,
references to $ and dollars are to Canadian dollars and references to US$ and US dollars are to United States dollars. See Item 3.A Selected Financial Data 
Currency and Exchange Rates.

Unless otherwise indicated, all financial statement data in this annual report in respect of
periods commencing on or after September 1, 2010 has been derived from financial statements prepared in accordance with IFRS as issued by the International Accounting Standards Board. Postmedia Network Canada Corp.s audited consolidated
financial statements for the years ended August 31, 2015, 2014, and 2013 included in this annual report, attached hereto as Exhibit 15.1 are prepared in accordance with IFRS as issued by the International Accounting Standards Board.



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PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

Not applicable

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable

ITEM 3. KEY INFORMATION



|A. | Selected Financial Data.
|-- | ------------------------

Set forth below is selected financial data of the Corporation, at the dates and for the periods indicated.

The selected financial data as of and for the years ended August 31, 2015, 2014 and 2013 have been derived from Postmedias audited
consolidated financial statements for the years ended August 31, 2015, 2014 and 2013, attached hereto as Exhibit 15.1. In addition, financial data pertaining to the years ended August 31, 2012 and 2011 are also disclosed. As a result
of Postmedias adoption of new and amended accounting standards in accordance with their respective transition provisions effective September 1, 2013, the selected financial data as of and for the years ended August 31, 2013 and 2012
has been revised to reflect the adoption of these new and amended standards. For a summary of the impact of the new and amended standards refer to note 2 of the audited consolidated financial statements for the years ended August 31, 2014, 2013
and 2012 which can be obtained from the Postmedia Network Canada Corp.s 20-F for the year ended August 31, 2014.

The selected
financial data should be read in conjunction with, and are qualified by reference to, Items 4 and 5 of this annual report on Form 20-F. In addition, the selected financial data for periods presented prior to April 13, 2015 does not include the
results of the properties acquired in the Sun Acquisition as described in Item 4.A History and Development of the Company - Significant Post-Acquisition Events. The results of operations for the year ended August 31, 2015
includes the results of the properties acquired in the Sun Acquisition for the period April 13, 2015 to August 31, 2015.



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|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|-------------------------------------------------------------------------------------------- |  | ---------------------- |  | ---------- |  | ------- |  | ------- |  | -------
|                                                                                             |  | Postmedia             
|                                                                                             |  | Years ended August 31,
|                                                                                             |  | 2011(8)                |  | 2012(2)(8) |  | 2013(2) |  | 2014    |  | 2015(1)
|(in millions of Canadian dollars)                                                            |  |                        |  |            |  |         |  |         |  |        
|                                                                                             |  |                        |  |            | 
|Revenues                                                                                     |  | 898.9                  |  | 831.9      |  | 751.6   |  | 674.3   |  | 750.3  
|Expenses                                                                                     |  | 709.7                  |  | 688.0      |  | 621.7   |  | 564.8   |  | 638.9  
|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|Operating income before depreciation, amortization, impairment and restructuring             |  | 189.2                  |  | 143.9      |  | 129.9   |  | 109.5   |  | 111.4  
|Depreciation                                                                                 |  | 27.0                   |  | 26.2       |  | 29.9    |  | 66.6    |  | 32.0   
|Amortization                                                                                 |  | 45.2                   |  | 43.6       |  | 43.3    |  | 39.1    |  | 40.1   
|Impairments (3)                                                                              |  |                       |  |           |  | 100.0   |  |        |  | 153.0  
|Restructuring and other items (4)                                                            |  | 38.0                   |  | 35.3       |  | 34.2    |  | 39.3    |  | 34.6   
|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|Operating income (loss)                                                                      |  | 79.0                   |  | 38.8       |  | (77.5)  |  | (35.5)  |  | (148.3)
|Interest expense                                                                             |  | 72.3                   |  | 65.4       |  | 61.9    |  | 61.9    |  | 69.2   
|Loss on debt repayment (5)                                                                   |  | 11.0                   |  | 9.2        |  |        |  |        |  |       
|Net financing expense relating to employee benefit plans                                     |  | 3.0                    |  | 5.7        |  | 7.5     |  | 5.6     |  | 5.6    
|(Gain) loss on derivative financial instruments                                              |  | 21.4                   |  | (8.6)      |  | 7.3     |  | (1.6)   |  | 18.4   
|Foreign currency exchange (gains) losses                                                     |  | (17.9)                 |  | 6.4        |  | 7.1     |  | 6.3     |  | 61.8   
|(Gain) loss on disposal of property and equipment, intangible assets and asset held-for-sale |  | 0.2                    |  | 0.3        |  | (1.0)   |  | (0.3)   |  | (1.2)  
|Acquisition costs (6)                                                                        |  | 1.2                    |  |           |  |        |  |        |  |       
|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|Net loss before income taxes                                                                 |  | (12.2)                 |  | (39.6)     |  | (160.3) |  | (107.4) |  | (302.1)
|Recovery of income taxes(7)                                                                  |  |                       |  |           |  |        |  |        |  | (38.7) 
|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|Net loss from continuing operations                                                          |  | (12.2)                 |  | (39.6)     |  | (160.3) |  | (107.4) |  | (263.4)
|Net earnings from discontinued operations(8)                                                 |  | 2.6                    |  | 13.5       |  |        |  |        |  |       
|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|Net loss                                                                                     |  | (9.6)                  |  | (26.1)     |  | (160.3) |  | (107.4) |  | (263.4)
|                                                                                             |  |                        |  |            |  |         |  |         |  |        
|                                                                                             |  |                        |  |            | 
|Net loss per share from continuing operations:                                               |  |                        |  |            |  |         |  |         |  |        
|Basic                                                                                        |  | $(0.30)                |  | $(0.98)    |  | $(3.98) |  | $(2.67) |  | $(1.98)
|Diluted                                                                                      |  | $(0.30)                |  | $(0.98)    |  | $(3.98) |  | $(2.67) |  | $(1.98)
|Net loss per share:                                                                          |  |                        |  |            |  |         |  |         |  |        
|Basic                                                                                        |  | $(0.24)                |  | $(0.65)    |  | $(3.98) |  | $(2.67) |  | $(1.98)
|Diluted                                                                                      |  | $(0.24)                |  | $(0.65)    |  | $(3.98) |  | $(2.67) |  | $(1.98)
|                                                                                             |  |                        |  |            | 
|Balance sheet data:                                                                          |  |                        |  |            |  |         |  |         |  |        
|Long-term debt (including current portion)                                                   |  | 572.3                  |  | 499.9      |  | 486.9   |  | 486.3   |  | 672.3  
|Total assets                                                                                 |  | 1,180.2                |  | 1,044.8    |  | 862.8   |  | 740.6   |  | 874.1  
|Net assets (liabilities)                                                                     |  | 315.3                  |  | 231.8      |  | 134.2   |  | 10.9    |  | (89.3) 
|Capital stock                                                                                |  | 371.1                  |  | 371.1      |  | 371.1   |  | 371.1   |  | 535.5  
|                                                                                             |  |                        |  |            | 
|Other:                                                                                       |  |                        |  |            |  |         |  |         |  |        
|Number of shares outstanding                                                                 |  | 40.3                   |  | 40.3       |  | 40.2    |  | 40.2    |  | 281.2  
|Dividends declared per share                                                                 |  |                       |  |           |  |        |  |        |  |       



Notes:



|(1) | The selected financial data for the year ended August 31, 2015 includes the results of the properties acquired in the Sun Acquisition for the
period from April 13, 2015 to August 31, 2015.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The selected financial data of Postmedia as at and for the years ended August 31, 2013 and 2012 have been revised as a result of the adoption
of new and amended accounting standards in accordance with their respective transition provisions effective September 1, 2013. For a summary of the impact of the new and amended standards refer to note 2 of the audited consolidated financial
statements for the years ended August 31, 2014, 2013 and 2012 which can be obtained from the Postmedia Network Canada Corp.s 20-F for the year ended August 31, 2014.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | During the years ended August 31, 2015 and 2013, as a result of interim and annual impairment testing of goodwill and indefinite life
intangible assets Postmedia recorded an impairment of $150.7 million and $93.9 million, respectively. During the year ended August 31, 2015 the impairment consisted of $80.0 million related to goodwill and $70.7 million related to indefinite
life intangible assets (2013 - $73.9 million related to goodwill, $16.4 million related to indefinite life intangible assets and $3.6 million related to property and equipment). The impairments were as a result of lower than anticipated long-term
revenue projections due to economic and structural factors including the uncertainty of the print advertising market and the rapidly evolving digital advertising market. In addition, during the year ended August 31, 2015, Postmedia recorded an
impairment of $2.3 million with respect to the sale of a production facility and during the year ended August 31, 2013, Postmedia recorded an impairment of $6.1 million with respect to a production facility upon reclassification of the asset
from property and equipment to asset held-for-sale. For more information refer to note 5 of the audited consolidated financial statements for the years ended August 31, 2015, 2014, and 2013 included in this annual report, attached hereto as
Exhibit 15.1
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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|(4) | Restructuring and other items expense primarily reflects employee termination costs related to various initiatives undertaken by Postmedia with the
objective of permanently reducing or eliminating costs. Also included in this line item for the years ended August 31, 2015 and 2014 are expenses related to the Sun Acquisition and for the year ended August 31, 2013 an expense related to
changes made to an employee benefit plan as a result of an arbitrators ruling. In addition, also included in this line item for the years ended August 31, 2012 and 2011 are curtailment gains relating to employee benefit plans a result of
the termination of employees under the restructuring initiatives. The restructuring initiatives resulted in the elimination, for a significant number of employees, of the right to earn defined benefits and as a result curtailments occurred.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | During the years ended August 31, 2011 and 2012, Postmedia recorded a loss on debt repayment related to the first amendment of its ABL
Facility and the repayment of the Term Loan Facility, respectively.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) | Acquisition costs relate to advisory, legal, valuation, and other professional fees incurred in connection with the Acquisition of Canwest LP which
are non-recurring.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Recovery of income taxes for the year ended August 31, 2015 was as a result of the recognition of a portion of Postmedias historical tax
loss carryforwards which offset the scheduled reversal of taxable temporary differences acquired in the Sun Acquisition. For the years ended August 31, 2014, 2013, 2012 and 2011, Postmedia has not recorded a current or deferred tax expense or
recovery as any current taxes payable or recoverable result in a decrease or increase, respectively, to Postmedias tax loss carryforward balances. The cumulative tax loss carryforward balances have not been recognized as a net deferred tax
asset on the statement of financial position.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) | On November 30, 2011, Postmedia completed the sale of the Disposed Properties. As a result of the sale, Postmedia has presented the results of
the Disposed Properties as discontinued operations as at and for the period ended November 30, 2011, and as such the statement of operations for the year ended August 31, 2011 prepared in accordance with IFRS reflects this change in
presentation. The statement of financial position and the statements of cash flows for the year ended August 31, 2011 have not been revised to reflect this change in presentation. Net earnings from discontinued operations for the year ended
August 31, 2012 includes a gain on sale of discontinued operations of $17.1 million and additional interest expense allocated to discontinued operations of $6.4 million.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|B. | Capitalization and indebtedness.
|-- | --------------------------------

Not applicable



|C. | Reason for the Offer and Use of Proceeds.
|-- | -----------------------------------------

Not applicable



|D. | Risk Factors.
|-- | -------------

The Corporation is subject to a number of risks and uncertainties which are described in detail in its MD&A, attached hereto as
Exhibit 15.2, under the section entitled Risk Factors which section is incorporated by reference in this annual report. The risks and uncertainties described in the MD&A are those the Corporation currently believe to be
material, but they are not the only ones the Corporation faces. If any of the risks, or any other risks and uncertainties that have not yet been identified or that are currently considered not to be material, actually occur or become material risks,
the Corporations business, financial condition, results of operations and cash flows and consequently, the price of the Corporations securities, could be materially and adversely affected.

ITEM 4. INFORMATION ON THE COMPANY



|A. | History and Development of the Company.
|-- | ---------------------------------------

Incorporation

7535538 Canada Inc. was
incorporated pursuant to the CBCA on April 26, 2010. Its name was changed to Postmedia Network Canada Corp. pursuant to Articles of Amendment filed on June 25, 2010. 7536321 Canada Inc. was incorporated pursuant to the CBCA on
April 27, 2010. Its name was changed to Postmedia Network Inc. pursuant to Articles of Amendment filed on June 25, 2010 and it is a wholly-owned subsidiary of the Corporation. The Corporations registered office is located at 365
Bloor Street East, 12th Floor Toronto, Ontario Canada, M4W 3L4 and its telephone number at that address (416) 383-2300 (the Toronto Head Office).



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Both Postmedia Network Canada Corp. and Postmedia Network Inc. were specifically incorporated for
the sole purpose of facilitating the acquisition on July 13, 2010 of substantially all of the newspaper and related online, digital, and mobile assets of the LP Entities including the shares of National Post Inc. See History and
Development of the Corporation  Acquisition below.

Acquisition

Canwest LP previously owned newspaper and related online, digital, and mobile assets and was wholly-owned by Canwest Global, a parent company
that also wholly-owned, among other entities, CPI, CBI and CCI.

CPI, CBI, and CCI sought, and on January 8, 2010 obtained,
protection under the CCAA granting protection from creditors. Although not itself an applicant, the protections provided by the CCAA were extended to Canwest LP. National Post Inc. was excluded from the CCAA protection.

Pursuant to the Asset Purchase Agreement that was entered into in connection with the implementation of the plan of arrangement and compromise
under the CCAA relating to the LP Entities (the Plan), Postmedia Network Inc. purchased substantially all of the assets, including the shares of National Post Inc., and assumed certain liabilities of Canwest LP (the
Acquisition) for $1.05 billion (the Acquisition Consideration). The Acquisition Consideration consisted of cash consideration of $927.8 million and non-cash consideration, through the issuance of equity, having
a value of $120.1 million. To satisfy the cash portion of the purchase price and to fund certain transaction costs under the Asset Purchase Agreement and the Plan, Postmedia raised an aggregate of $954.4 million of financing, consisting of the Term
Loan Facility, Second-Lien Notes and the issuance of equity. See Item 10. C Material Contracts  Second-Lien Notes Indenture.

The Acquisition closed and the Plan was implemented on July 13, 2010.

Significant Post-Acquisition Events

On
January 31, 2011, National Post Inc. was dissolved and its assets and liabilities were transferred to Postmedia Network Inc.

On
June 7, 2011, the Corporation filed the Prospectus in all provinces of Canada other than Quebec. On June 14, 2011, the Corporations Voting Shares and Variable Voting Shares were listed and began trading on the TSX under the symbols
PNC.A and PNC.B, respectively.

On November 30, 2011, the Corporation sold substantially all of
the assets and liabilities of the Lower Mainland Publishing Group, the Victoria Times Colonist and the Vancouver Island Newspaper Group, to Glacier Media Inc., collectively herein referred to as the Disposed Properties (the
Glacier Transaction).

On August 16, 2012, the Corporation issued $250 million in aggregate principal amount
of First-Lien Notes, the proceeds of which were used to repay the Term Loan Facility in its entirety. See Item 10.C Material Contracts  First-Lien Notes Indenture.



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On October 6, 2014, the Corporation entered into a purchase agreement (the Purchase
Agreement) with Quebecor Media Inc. (QMI) to purchase all of the outstanding shares of 7717415 Canada Inc. (previously known as Quebecor Media Printing Inc.) (QMPI). As at the acquisition date
of April 13, 2015, QMPI owned Sun Media Corporations stable of more than 170 English-language newspapers and specialty publications as well as digital properties. The purchase price consisted of
cash consideration of $305.5 million, less a final closing working capital receivable of $1.2 million which was received subsequent to August 31, 2015 (the Sun Acquisition). Upon acquisition, QMPI and its subsidiary, 8869332
Canada Inc., amalgamated to form a new corporation which subsequently amalgamated with Postmedia Network Inc. The Corporation financed the purchase price and transaction costs associated with the Sun Acquisition through the issuance of First-Lien
Notes, the issuance of Variable Voting Shares pursuant to a rights offering of subscription receipts (the Rights Offering), net proceeds related to the sale of the Montreal Gazette production facility and corporate cash, all as
described below.

The debt financing for the Sun Acquisition was provided through the issuance of additional First-Lien Notes for proceeds
of $140.0 million to an existing noteholder, Canso Investment Counsel Ltd. (Canso), acting on behalf of certain accounts that it manages. On October 31, 2014, pursuant to a subscription agreement with Canso (the
Subscription Agreement), the Corporation issued subscription receipts (Notes Subscription Receipts) which were automatically exchanged for the additional First-Lien Notes on April 13, 2015. The Notes
Subscription Receipts were governed by a subscription receipts indenture between Postmedia Network Inc. and Computershare Trust Company of Canada (the Subscription Receipt Indenture) and bore interest at the same rate as the
First-Lien Notes with interest commencing as of November 1, 2014.

The equity financing for the Sun Acquisition was provided pursuant
to the Rights Offering for proceeds of $173.5 million. Under the terms of the Rights Offering, shareholders of the Corporation as of February 17, 2015 received one right for each share held to subscribe for 5.9929 subscription receipts
(Equity Subscription Receipts). On March 18, 2015, the Rights Offering closed, with a total of 240,972,226 Equity Subscription Receipts issued at a subscription price of $0.72, which represented a significant discount to the
market price of the Variable Voting Shares at the time. On April 13, 2015, each Equity Subscription Receipt was automatically exchanged for one Variable Voting Share without additional consideration.

The remaining financing for the Sun Acquisition was provided through the net proceeds related to the sale of the Montreal Gazette production
facility of $12.4 million and corporate cash.

As of August 31, 2015, the Corporation completed its three year business
transformation program that was announced in July 2012 that targeted total operating cost reductions of 15% to 20%. In total, the Corporation implemented net annualized cost savings of approximately $136 million, or 20% of operating costs under the
Transformation Program. The net annualized cost savings primarily relate to decreases in compensation expenses partially offset by increases in production expenses as a result of outsourced production of several newspapers including the Edmonton
Journal in August 2013, the Calgary Herald in November 2013, the Montreal Gazette in August 2014 and the Vancouver newspapers (The Vancouver Sun and The Province) in February 2015. As a result of the Sun Acquisition and the continuing trends in
advertising revenue, the Corporation continues to pursue additional cost reduction initiatives. In July 2015, the Corporation announced that it would undertake cost reduction initiatives targeted to deliver an estimated additional $50 million in
operating costs by the end of Fiscal 2017. These additional cost reductions are expected to come from a combination of acquisition synergies and further streamlining of operations.

On October 16, 2014 the Corporation entered into a new senior secured asset-based revolving credit facility (the ABL
Facility) for an aggregate amount of up to $20 million. The ABL Facility replaced the Corporations previous facility that matured on July 13, 2014. The ABL Facility was not previously used, and upon maturity on October 16,
2015, management chose not to replace it.



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|B. | Business Overview.
|-- | ------------------

General

Postmedias business
consists of news and information gathering and dissemination operations, with products offered in local, regional and major metropolitan markets in Canada through a variety of print, web, tablet and smartphone platforms. Postmedia is the largest
publisher by circulation of daily newspapers in Canada, according to Newspapers Canadas 2014 Circulation Data Report. The Corporation has the highest weekly print readership of daily newspapers in Canada, based on Vividata Fall 2015 survey
data.

The combination of these distribution platforms provides audiences with a variety of media through which to access and interact
with Postmedias content. The breadth of Postmedias reach and the diversity of its content enable advertisers to reach their target audiences on a local, regional or national scale through the convenience of a single provider.

Postmedia had an approximately 37% share of Canadas total daily newspaper circulation according to Newspapers Canadas 2014
Circulation Data Report, and weekly readership of 7.6 million Canadian adults according to the Vividata Fall 2015 survey data. The Corporation has the leading English-language daily newspaper, based on weekly print readership, in five out of
the six largest advertising markets in Canada according to the Vividata Fall 2015 survey data. Its daily metropolitan newspaper brands are among the oldest in Canada with an average publication history of 108 years.

Postmedia has one operating segment, the Newsmedia segment. The Newsmedia segment publishes daily and non-daily newspapers and operates
digital media and online assets including the canada.com and canoe.com websites, each newspapers online website, various classified advertising websites and Infomart, the Corporations media monitoring service.

The Corporation owns and operates the National Post, which is one of Canadas two daily national newspapers, 15 daily metropolitan
newspapers, two free daily commuter newspapers in Toronto and Vancouver, 27 daily newspapers in smaller community markets, 123 non-daily community newspapers and non-daily shopping guides, and various specialty publications and newspaper-related
publications. Its operations also include Flyer Force, a distribution service for advertising flyers and circulars for third parties. The Corporation also provides sales representation services to third-party owned publications.

Postmedia also has an extensive portfolio of digital media and online assets. It owns and operates 162 destination websites that make up the
Postmedia digital network, one of Canadas leading online general news and information sources, covering its newspapers websites, including classified websites and other online properties. The Corporation also provides sales
representation services to third-party branded sites.

The Corporation has also developed its mobile network, which includes mobile
optimized websites and mobile applications across various tablet and smartphone platforms such as iOS, Android and BlackBerry. The Corporations mobile applications include, but are not limited to, applications relating to its newspaper
operations.

Postmedias expertise in content production and digital product development allows for expanded service offerings to
Canadian marketers and advertisers. National and local sales teams work collaboratively with clients to develop new programs on and off Postmedias digital network. New areas under development include digital and content marketing services.



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Newsmedia Operations

The Corporation publishes 15 daily metropolitan newspapers (nine broadsheets and six tabloids) and a national newspaper. Its daily metropolitan
newspapers are geographically diverse and located in major metropolitan centres across Canada, which provides the Corporation and its advertisers access to target audiences throughout Canada. Postmedias daily newspapers are well-established in
the communities that they serve several dating back more than 100 years. Postmedias combination of national reach and local presence makes the Corporations daily newspapers attractive to both national and local advertisers.
Postmedias newspapers have consistently been recognized for the quality of their content, having received numerous nominations and awards. Recent recognition includes: Several National Newspaper awards including journalists and teams from
National Post, Ottawa Citizen, Toronto Sun, Edmonton Journal and The Vancouver Sun; Newspapers Canada Great Idea Awards for Ottawa Citizen, Calgary Herald and Montreal Gazette; National Post won 91 awards of excellence and was a finalist for
Worlds Best-Designed Newspaper at the Society for News Design Best of Newspaper Design; Montreal Gazette took home three Awards of Excellence and Postmedia won an Award of Excellence for our Postmedia Reimagined redesign at the Society for
News Design Best of Digital Design; the International News Media Association (INMA) recognized Postmedia, with Ottawa Citizens Trending Since 1845 campaign taking home the second place prize and the Montreal Gazette and Calgary
Herald Reimagined launch campaigns coming in third; National Post, Edmonton Journal and Gastropost each won Canadian Online Publishing Awards; at the Jack Webster awards The Vancouver Sun won a first place award and The Province won two top prizes;
and the Calgary Herald won a top prize at the Online Journalism Awards, presented by the Online News Association.

According to Newspapers
Canadas 2014 Circulation Data Report, the Corporation had an approximately 37% share of Canadas total daily newspaper circulation. In addition, in nine out of the eleven daily metropolitan newspaper markets in which the Corporation
operates, it has the highest circulation and readership among English-language newspapers based on average daily circulation and readership.

The National Post, the Corporations daily national newspaper, provides benefits to the Corporations overall operations, including
the provision of a newspaper with a national audience footprint. A new daily print section, 6 to 10 pages in length, of national and international news, commentary and analysis provided by the National Post has, to date, been included in five
Postmedia newspapers (Edmonton Journal, Windsor Star, Montreal Gazette, Regina Leader-Post and Saskatoon StarPhoenix). This section extends National Posts measurable readership and provides national and local advertising opportunities.



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The following table provides details about the Corporations metropolitan daily newspapers:



|                              |  |           |  |                 |  |                   |  |                               |  |     |      |  |  |  |  |  |  |  |  | 
|----------------------------- |  | --------- |  | --------------- |  | ----------------- |  | ----------------------------- |  | --- | ---- |  |  |  |  |  |  |  |  | 
|Publication                   |  | Market    |  | YearEstablished |  | MarketPosition(1) |  | LocalNewspaperMarket Share(1)
|Daily Metropolitan Newspapers |  |           |  |                 |  |                   |  |                               |  |     |     
|The Province                  |  | Vancouver |  | 1884            |  | 2(2)              |  |                               |  | 100 | %(7)
|The Vancouver Sun             |  | Vancouver |  | 1886            |  | 1                 |  |                               |  | 100 | %(7)
|Montreal Gazette              |  | Montreal  |  | 1778            |  | 3(3)              |  |                               |  | 100 | %   
|Calgary Herald                |  | Calgary   |  | 1883            |  | 1                 |  |                               |  | 100 | %(7)
|Calgary Sun                   |  | Calgary   |  | 1980            |  | 2(4)              |  |                               |  | 100 | %(7)
|Edmonton Journal              |  | Edmonton  |  | 1903            |  | 1                 |  |                               |  | 100 | %(7)
|Edmonton Sun                  |  | Edmonton  |  | 1978            |  | 2(5)              |  |                               |  | 100 | %(7)
|Ottawa Citizen                |  | Ottawa    |  | 1845            |  | 1                 |  |                               |  | 100 | %(7)
|Ottawa Sun                    |  | Ottawa    |  | 1988            |  | 2(6)              |  |                               |  | 100 | %(7)
|Toronto Sun                   |  | Toronto   |  | 1971            |  | 2                 |  |                               |  | 29  | %   
|Windsor Star                  |  | Windsor   |  | 1918            |  | 1                 |  |                               |  | 100 | %   
|London Free Press             |  | London    |  | 1821            |  | 1                 |  |                               |  | 100 | %   
|Saskatoon StarPhoenix         |  | Saskatoon |  | 1902            |  | 1                 |  |                               |  | 100 | %   
|Regina Leader-Post            |  | Regina    |  | 1883            |  | 1                 |  |                               |  | 100 | %   
|Winnipeg Sun                  |  | Winnipeg  |  | 1980            |  | 2                 |  |                               |  | 33  | %   
|Daily National Newspaper      |  |           |  |                 |  |                   |  |                               |  |     |     
|National Post                 |  | National  |  | 1997            |  | 2                 |  |                               |  | N/A |     



Notes:



|1) | Market position and local newspaper market share for English language newspapers are determined by average paid circulation of daily newspapers.
Source: Newspapers Canada  2014 Circulation Data Report.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2) | Second to The Vancouver Sun, which is also operated by the Corporation.
|-- | -----------------------------------------------------------------------

|3) | Number one English-language paid daily newspaper; number three overall among paid daily newspapers.
|-- | ---------------------------------------------------------------------------------------------------

|4) | Second to the Calgary Herald, which is also operated by the Corporation.
|-- | ------------------------------------------------------------------------

|5) | Second to the Edmonton Journal, which is also operated by the Corporation.
|-- | --------------------------------------------------------------------------

|6) | Second to the Ottawa Citizen, which is also operated by the Corporation.
|-- | ------------------------------------------------------------------------

|7) | Includes all properties operated by the Corporation in this market.
|-- | -------------------------------------------------------------------



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The following table provides the average paid daily circulation of the Corporations 27
community daily newspapers per the Newspapers Canada 2014 Circulation Data Report:



|                                     |  |                           |  |                              
|------------------------------------ |  | ------------------------- |  | -----------------------------
|Newspaper                            |  | Location                  |  | Average Daily PaidCirculation
|The Standard                         |  | St. Catharines, Ontario   |  | 23,160                       
|The Expositor                        |  | Brantford, Ontario        |  | 18,113                       
|The Kingston Whig-Standard .         |  | Kingston, Ontario         |  | 17,342                       
|The Peterborough Examiner            |  | Peterborough, Ontario     |  | 15,384                       
|The Sun Times                        |  | Owen Sound, Ontario       |  | 14,076                       
|The Barrie Examiner                  |  | Barrie, Ontario           |  | 13,911                       
|Niagara Falls Review                 |  | Niagara Falls, Ontario    |  | 13,148                       
|The Recorder & Times                 |  | Brockville, Ontario       |  | 10,796                       
|The Tribune                          |  | Welland, Ontario          |  | 10,460                       
|The Sault Star                       |  | Sault Ste. Marie, Ontario |  | 9,947                        
|The Sudbury Star                     |  | Sudbury, Ontario          |  | 9,573                        
|Simcoe Reformer                      |  | Simcoe, Ontario           |  | 9,468                        
|The Observer                         |  | Sarnia, Ontario           |  | 9,317                        
|Packet & Times                       |  | Orillia, Ontario          |  | 8,654                        
|North Bay Nugget                     |  | North Bay, Ontario        |  | 8,509                        
|Cornwall Standard Freeholder         |  | Cornwall, Ontario         |  | 7,511                        
|The Intelligencer                    |  | Belleville, Ontario       |  | 7,233                        
|The Daily Press                      |  | Timmins, Ontario          |  | 7,121                        
|Northumberland Today                 |  | Cobourg, Ontario          |  | 6,858                        
|The Beacon Herald                    |  | Stratford, Ontario        |  | 6,680                        
|The Chatham Daily News               |  | Chatham, Ontario          |  | 5,395                        
|Daily Herald Tribune                 |  | Grande Prairie, Alberta   |  | 3,728                        
|Sentinel-Review                      |  | Woodstock, Ontario        |  | 3,713                        
|The Daily Observer                   |  | Pembroke, Ontario         |  | 3,331                        
|St. Thomas Times-Journal             |  | St. Thomas, Ontario       |  | 3,293                        
|Fort McMurray Today                  |  | Fort McMurray, Alberta    |  | 1,902                        
|Kenora Daily Miner & News            |  | Kenora, Ontario           |  | 1,187                        
|                                     |  |                           |  |                              
|Total Average Daily Paid Circulation |  | 249,810                  
|                                     |  |                           |  |                              

The Corporation publishes 123 non-daily newspapers and shopping guides distributed in Ontario, Alberta,
Manitoba and Saskatchewan. Postmedias non-daily newspapers and shopping guides are generally delivered to every household in the respective communities in which they operate, thereby providing advertisers with substantial coverage of these
community markets. In addition, the Corporation publishes two free daily commuter newspapers in Toronto and Vancouver that have average daily circulation of 219,199 and 115,178, respectively, per the Newspapers Canada 2014 Circulation Data Report.

Postmedia seeks to grow its revenue by leveraging its industry leading print brands and strong customer relationships into its expanding
digital media and online product offerings. The Corporations digital media and online operations include the Postmedia digital network, websites for the Corporations daily and community newspapers, online classified websites, and
Infomart (a subscription-based media monitoring service). In addition, Postmedias digital media and online operations sell advertising on behalf of third-party websites. These agreements extend the reach of the Postmedia digital network and
increase the Corporations advertising sales opportunities. The Corporation has also developed its mobile network, which includes mobile optimized websites and mobile applications across various tablet and smartphone platforms such as iOS,
Android and BlackBerry.



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##### Table of Contents

The Postmedia digital network is a comprehensive 24/7 online news, entertainment and information
network of content distributed through websites and mobile platforms that leverages the Corporations content, brands and customer relationships. The Postmedia digital network is one of Canadas leading online general news and information
sources that integrates Canadian news and specialty content. The Postmedia digital network hosts the websites and electronic editions of the Corporations daily and community newspapers as well as other select websites. Being hosted on the
Postmedia digital network offers these websites a platform to extend their audience reach and market, as well as to build and reinforce relationships with respect to both advertisers and audiences. The Postmedia digital network has also developed
its mobile products, which includes mobile optimized websites and mobile applications across various smartphone platforms such as iOS, Android and BlackBerry. The Postmedia digital network had 11.4 million average monthly unique visitors for
the fourth quarter of Fiscal 2015.

Through the Corporations proprietary content, as well as technology partners and third-party
content providers, the Postmedia digital network provides a number of personalized online tools, including internet search and other services. The Postmedia digital network currently provides up-to-date international, national and local news
coverage sourced from the Corporations newspapers and third-party newswire services including text, photos, videos, databases and interactive applications. The licensed content covers a broad range of topics, including sports, entertainment,
automotive, recreation and travel from a variety of well-known content providers.

As part of its effort to grow its digital media and
online business, Postmedias newspapers deliver content across multiple platforms including desktop, tablet and mobile devices.

Through expertise in exporting electronic press pages intended for print editions to web-friendly formats, the daily newspapers publish
page-by-page e-Papers, complete with stories, columns, photos and advertising. The e-Papers are available to print subscribers at no cost for broadsheet publications and for an additional $1.99 per month for tabloid publications. Readers of the e-Papers are able to view page layouts, photos and advertisements exactly as they appear in the print edition of the newspaper. The experience is enhanced by a variety of digital features and tools, including
search, aimed to ease navigation and add value.

Postmedias print subscribers receive free access to their print newspapers
website via desktop, tablet and mobile devices, each of which provides headlines, breaking news, analysis, commentary and selected stories from the daily newspaper editions. For non-print subscribers, Canadian
users can access ten free articles and international users can access five free articles every 30 days or purchase a digital access subscription to obtain unlimited access. The Corporations newspapers websites also serve as customer
relationship tools, promoting subscriptions to the print editions, allowing for the purchase or renewal of newspaper subscriptions, permitting notification of vacation stops and reactivations, and processing of billing inquiries.

Postmedias digital audience ranked number one for average monthly unique visitors in the newspaper category based on the year ended
August 31, 2015 in Canada, according to comScore, and these sites reach 43% of all Canadians who visit newspaper websites.

Infomart
is a subscription-based business-to-business service for Canadian news and business information and a one-stop resource for media monitoring, research insights, brand solutions and financial and corporate data. The service offers online media
monitoring covering print, broadcast television and radio, social media, and newswires in a single integrated platform. Print sources include all of the Corporations publications plus other Canadian and international sources such as
third-party newspapers. As of August 31, 2015, Infomart had approximately 800 subscribers.

In addition to subscriptions, Infomart
also generates revenue through an electronic licensing and rights management service of the Corporations news content, corporate data and third-party content via domestic and international third-party channels used by businesses across North
America.



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The Corporation is branching into new revenue streams, including the launch of digital marketing
services, which include search engine optimization, search engine marketing, website design and creation. The Corporation is also entering content marketing with the creation of its Content Works group. This group will focus on content creation,
distribution and measurement for brands. Measurement will occur through the Infomart platform.

Functional Operations

Editorial

Editorial content is generated
across the Corporations digital platforms and publications and Postmedias infrastructure allows for sharing of its generated content among newspapers in an efficient and cost effective manner. Generally, editorial policy is developed for
each of the Corporations newspapers by local newsroom management. This leadership ensures that each newspaper is responsive to local issues and meets the editorial needs of its readers. The Corporations newspapers and digital platforms
focus on readers of various ages and demographics and aim to reflect the values and interests of their respective markets. Each of the Corporations newspapers has its own editorial staff that is responsible for producing local editorial
content of the newspaper and digital platforms supplemented by certain content which comes from Postmedias centralized editorial services, other wire services and freelancers.

The Corporation owns or has the rights to use the editorial content that is produced by its employees and freelancers, which allows for
sharing of information and editorial content among its various publications. Further, since the Corporations newspapers operate across a broad geographic spectrum, reporters familiar with local issues can be assigned to cover national events
in a particular region. Management believes that sharing of editorial content and expertise allows the Corporation to achieve substantial operating efficiencies compared to other publishers which own a smaller number of publications.

The Corporation also provides centralized pagination and production services to some of the Corporations newspapers.

Sales and Advertising

The following
charts provide a breakdown of the Corporations revenue for Fiscal 2015 and 2014:



|            |  |            
|----------- |  | -----------
|Fiscal 2015 |  | Fiscal 2014
|LOGO        |  | LOGO       



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The following charts provide a breakdown of the Corporations total print advertising
revenue for Fiscal 2015 and 2014:



|            |  |            
|----------- |  | -----------
|Fiscal 2015 |  | Fiscal 2014
|LOGO        |  | LOGO       

The Corporation offers advertisers extensive audience reach through a combination of circulation and
readership of its newspapers, e-Papers, unique visitors to its websites and various mobile and tablet products.

The Corporations
local advertising is sold on a publication-by-publication and regional basis. Each of the Corporations newspapers has a locally-based sales team that sells advertising for both print and digital, principally to local businesses and
organizations. The majority of local advertising relates to automotive, employment and real estate advertisements. The Corporation also uses an outsourced call centre to generate classified sales.

National advertising takes the form of advertisements for both print and digital, primarily from large national companies. The major national
advertising categories are automotive, food & drug, home and department stores, financial services and technology. The sale of national advertisements is handled by a national sales group (Postmedia Integrated Advertising or
PIA), which employs a dedicated sales team that services the Corporations group of newspapers and digital properties and provides individual newspapers with advertising sales representation, insertion order processing and
invoicing. PIA operates through offices in Toronto, Montreal and Vancouver, in addition to one contract representative in the U.S. PIA also represents several third-party publishers and publications acting as their national advertising sales agent
on a commissioned basis.

Circulation and Distribution

The Corporations circulation revenue is generated from subscription revenue (both print and digital), single copy sales made through
retailers and vending boxes, and corporate bulk sales. Newspapers are shipped from printing plants to depot drop locations or single copy retail outlets by independent trucking companies in the daily markets. Postmedias newspaper distribution
is carried out primarily by independent distributors and carriers that deliver newspapers to subscribers. These third-party distribution networks enable the Corporation to operate via short-term contracts and reduce supplier concentration issues.
Postmedias non-daily newspapers are generally delivered via Canada Post and independent carriers.

The Corporation benefits from
agreements with distributors which provide for the delivery of newspapers from printing facilities to bulk locations, retailers, vending boxes and residential and corporate subscribers. Typically, a newspaper division is party to several
distribution agreements, covering different stages of delivery and geographical areas.



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In addition to distributing newspapers, Postmedia also offers three types of insert distribution
services:



| |  |  | Paid subscriber basedistribution to existing newspaper subscribers;
| | - |  | --------------------------------------------------------------------



| |  |  | Extended market coveragedistribution of flyers or other materials to non-subscriber households; and
| | - |  | ----------------------------------------------------------------------------------------------------



| |  |  | Total market coverageboth subscriber and non-subscriber households for full coverage to specific areas.
| | - |  | --------------------------------------------------------------------------------------------------------

These distribution options allow broader penetration of the Corporations markets, allowing advertisers to target specific demographic
and geographic segments. Extended market coverage and/or total market coverage distribution services are offered in the Corporations 27 daily newspaper markets as well as Regina, Saskatoon, Windsor and London. In addition, Flyer Force, a
distribution service for advertising flyers, distributes insert packages to non-subscribers in Calgary, Edmonton and Ottawa, providing extended market coverage for their associated Postmedia newspapers.

The Corporation offers pre-authorized monthly payment programs to its subscribers. These automatic credit card and bank debit payment programs
lower the cost of collection and enhance subscriber retention.

Printing

Other than as described in Outsourced Functions below, the Corporation owns all of the manufacturing equipment for its
newspapers and other publications, including printing presses and mailroom inserting equipment. In some markets, in order to improve the operating efficiency of its printing presses, the Corporation also uses its printing press capacity to print
advertising inserts, flyers and other third-party publications.

Outsourced Functions

As part of Postmedias ongoing focus on cost containment, various outsourcing initiatives have been implemented. Advertising production at
the majority of its newspapers have been outsourced to suppliers in the Philippines and India. Subscriber customer service call centre operations are operated by third parties in Canada and Jamaica. These subscriber services include answering and
handling customer calls, customer service inquiries and complaints. Postmedia has also outsourced its centralized classified call centre operations to a third party in the United States. In addition, printing operations have been outsourced for
certain of its magazines and newspapers including the Edmonton Journal, the Calgary Herald, the Montreal Gazette, The Vancouver Sun, The Province and 24 Hrs Vancouver, as well as the National Post in most regions.

Competitive Conditions

The Corporation
faces competition in each of its markets as information is now widely disseminated through many media platforms on a local, national and international basis. Participants in the newsmedia industry depend primarily upon advertising sales to generate
revenue, while newspaper companies also rely on paid subscriptions and single copy newspaper and digital subscription sales. Competition for advertising, subscribers, readers and distribution is intense and comes primarily from digital media, as
well as television; radio; local, regional and national newspapers; magazines; free publications; direct mail; telephone directories; and other communications and advertising and subscriber-based media that operate in these markets.

In recent years there has been a growing shift in advertising dollars from newspaper advertising to other advertising platforms, particularly
digital media competitors such as search engines and social media websites. To date, the newsmedia industry has made limited progress in replacing print advertising revenue with digital advertising revenue.



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Advertising on digital platforms is evolving rapidly, with technology driving innovations that
make digital media a very effective competitor and substitute for advertising in print newspapers. The scope and pace of technological change has entrenched the role of the largest international players  U.S.-based technology companies such as
Google, Microsoft, Facebook and Yahoo!  in existing and rapidly expanding forms of digital advertising.

The Corporations
digital competition is not limited to news sites. Digital advertising takes various forms, such as search-engine marketing, display advertising, online classified, online telephone directories, mobile advertising and video advertising.

More and more content and related advertising is being communicated over social networks operated by companies such as Facebook and Twitter.
As geo-tagging becomes more sophisticated, the recent increase in advertising on mobile platforms  driven by the adoption and penetration of smartphones and tablets  allows digital advertising to be targeted more locally, making it a
more effective substitute for local advertising in daily newspapers.

In addition, there is increasing consolidation in the Canadian
newsmedia industry, and competitors include market participants with interests in multiple media. These competitors may be more attractive than Postmedia to certain advertisers because they may be able to bundle advertising sales across newspaper,
television and digital media platforms. Some of these competitors also have access to greater financial and other resources than Postmedia does.

In 2014, the Canadian newspaper industry comprised approximately 91 paid daily English and French newspapers and 13 free dailies for
a total of 104 daily newspapers. Paid daily newspapers accounted for a total of 4,043,553 copies on an average publishing day, according to Newspapers Canada 2014 Circulation Data Report.

The Canadian daily newspaper industrys revenue was $2.4 billion in 2014, with 68% of that revenue derived from print, web and
mobile advertising and the balance from circulation and other revenue, according to the Canadian Newspaper Association. Canadian newspaper publishers typically sell advertising based primarily on readership and secondarily on circulation. In
contrast, U.S. newspaper publishers typically sell advertising based solely on circulation figures. Canadian newspapers have higher penetration compared to the U.S., with 65% of Canadian adults reading a daily newspaper (in print and digital) in the
past three months compared to only 38% of American adults in the past six months, according to the Vividata Fall 2015 survey data and the eMarketer Global Media Report, September 2015, respectively.

Components

Newsprint is the principal
raw material used in the production of Postmedias daily newspapers and other print publications. It is a commodity that is generally subject to price volatility. Newsprint expenses fluctuate due to both changes in volume and changes in price.

Postmedias cost of newsprint is influenced by its strong supplier relationships, volume purchasing power, proximity to Canadian
paper mills and regional supply arrangements that reduce transportation costs. The Corporation opportunistically enters into newsprint purchase agreements with varying terms of up to six months depending on external factors such as foreign export
demand, North American mill capacity, operating rates and inventory.

Intangible Properties

Postmedia uses a number of trademarks, service marks and trade names to identify its products and services. Many of these trademarks are
registered by the Corporation in the appropriate jurisdictions. In addition, the Corporation has legal rights in the unregistered marks arising from their use. Postmedia has taken affirmative legal steps to protect its trademarks, and it believes
its trademarks are adequately protected.



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The content of Postmedias newspapers and digital media and online assets are protected by
copyright. The Corporation owns copyrights in each of its publications as a whole and in all individual content items created by its employees in the course of their employment, subject to limited exceptions. Postmedia has entered into licensing
agreements with wire services, freelancers and other content suppliers on terms that it believes are sufficient to meet the needs of its operations. Postmedia believes that it has taken appropriate and reasonable measures to secure, protect and
maintain its rights or obtain agreements from licensees to secure, protect and maintain copyright protection of content produced or distributed by the Corporation.

Postmedia has registered a number of domain names, many of which constitute trademarks, service marks and trade names used in its business,
under which it operates websites. As every Internet domain name is unique, its domain names cannot be registered by other entities as long as its registrations are valid.

Postmedias intellectual property constitutes a significant part of the value of the Corporation. The Corporation relies on the
trademark, copyright, internet/domain name, trade secret and other laws of Canada and other countries, as well as nondisclosure and confidentiality agreements, to protect its intellectual property rights. However, the Corporation may be unable to
prevent third-parties from using its intellectual property without its authorization, breaching any nondisclosure agreements with the Corporation, acquiring and maintaining domain names that infringe or otherwise decrease the value of its trademarks
and other proprietary rights, or independently developing intellectual property that is similar to the Corporations, particularly in those countries that do not protect the Corporations proprietary rights as fully as in Canada.

Third-parties may challenge the validity or scope of Postmedias intellectual property rights from time to time, and such challenges
could result in the limitation or loss of intellectual property rights. Irrespective of their validity, such claims may result in substantial costs and diversion of resources, which could have an adverse effect on the Corporations operations.

Cycles

Advertisers budgets
tend to be cyclical, reflecting the general economic climate and consumers buying habits. As a result, Postmedias revenue has experienced, and is expected to continue to experience, seasonal variances due to advertising patterns and
influences on peoples media consumption habits. Typically, the Corporations revenue is lowest during the fourth quarter of its fiscal year, which ends in August, and highest during the first and third quarters, which end in November and
May, respectively, while expenses are relatively constant throughout the fiscal year. These seasonal variations may lead to short-term fluctuations in cash flow at certain times during the fiscal year.

Environmental Protection

Postmedias operations are subject to a variety of laws and regulations concerning, among other things, emissions to the air, water and
land, sewer discharges, handling, storage and disposal of, or exposure to, hazardous substances and wastes, recycling, remediation of contaminated sites or otherwise relating to protection of the environment and employee health and safety. The
Corporation uses and stores hazardous substances such as inks and solvents in conjunction with its operations at its printing facilities. Such hazardous substances have in the past been stored in underground storage tanks at some of the
Corporations properties. Some of its printing and other facilities are located in areas with a history of long-term industrial use, and may be impacted by past activities onsite or by contamination emanating from nearby industrial sites. In
the past, a Postmedia predecessor has had contamination resulting from leaks and spills at some of its locations. Postmedia has incurred and will continue to incur costs to comply with environmental, health and safety requirements but, to date, such
costs have not been material.



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Regulation

The publication of newspapers in Canada is not directly regulated by federal or provincial laws. There are, however, indirect restrictions on
the foreign ownership of Canadian newspapers by virtue of certain provisions of the Tax Act. The Tax Act limits the deductibility by Canadian taxpayers of expenditures for advertisements in issues of newspapers other than, except in limited
circumstances, Canadian issues of Canadian newspapers.

In order to qualify as a Canadian
issue, the issue generally must have its type set in Canada, be edited in Canada by individuals resident in Canada for purposes of the Tax Act and be printed and published in Canada. Issues of Postmedias newspapers currently meet
these criteria.

The test of whether a newspaper is a Canadian newspaper depends on the jurisdiction, governance,
factual control and share ownership of the corporation which directly publishes the newspaper. Postmedia publishes its newspapers directly. In order to satisfy the requirements of a Canadian newspaper (subject to a statutory 12
month grace period), Postmedia must satisfy the following: (i) the corporation must be incorporated under the laws of Canada or a province thereof, (ii) the chairperson or other presiding officer and at least 75% of the directors or other
similar officers of the corporation must be Canadian citizens, and (iii) the corporation must not be controlled, in fact, directly or indirectly, by citizens or subjects of a country other than Canada.

In addition, under the share ownership requirements set out in subsection (iii) of the preceding paragraph, at least 75% of the voting
shares of a non-public corporation and shares having a fair market value in total of at least 75% of the fair market value of all issued shares of a non-public corporation, must be beneficially owned by either (i) Canadian citizens or
(ii) one or more corporations incorporated in Canada each of which is a public corporation a class or classes of shares of which are listed on a designated stock exchange in Canada (which includes the TSX) other than a public corporation
controlled by citizens or subjects of a country other than Canada (Qualifying Public Corporation). Upon the listing of Postmedia Network Canada Corp.s shares on the TSX, it became a Qualifying Public Corporation. As
Postmedia Network Inc. is a direct, wholly-owned subsidiary of Postmedia Network Canada Corp., Postmedias newspapers qualify as Canadian newspapers.

Issues of Postmedias newspapers therefore qualify as Canadian issues of Canadian newspapers (or
otherwise fall outside of the limitation on deductibility of advertising expenses) and as a result advertisers currently have the right to deduct their advertising expenditures for Canadian tax purposes.



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##### Table of Contents

|C. | Organizational Structure.
|-- | -------------------------

The following chart illustrates Postmedias corporate structure.



LOGO



|D. | Property, Plant and Equipment.
|-- | ------------------------------

Postmedia owns 40 properties (inclusive of one that is accounted for as a finance lease) which are either office, production or combined
production and office facilities, the largest of which are listed below. All other activities of Postmedia are conducted in leased premises, including the Toronto Head Office.



|                       |  |                      |  |               |         | 
|---------------------- |  | -------------------- |  | ------------- | ------- | 
|Location of Facilities |  | Office or Production |  | Area(Sq. Ft.) |        
|Edmonton, AB(1)        |  | Office               |  |               | 133,250 | 
|Edmonton, AB           |  | Production           |  |               | 51,158  | 
|Calgary, AB(2)         |  | Combined facilities  |  |               | 383,000 | 
|Calgary, AB            |  | Combined facilities  |  |               | 86,139  | 
|Regina, SK             |  | Combined facilities  |  |               | 102,537 | 
|Saskatoon, SK          |  | Combined facilities  |  |               | 110,884 | 
|Winnipeg, MB           |  | Combined facilities  |  |               | 53,855  | 
|London, ON             |  | Combined facilities  |  |               | 130,259 | 
|Windsor, ON            |  | Production           |  |               | 60,000  | 
|Toronto, ON            |  | Production           |  |               | 488,179 | 
|Ottawa, ON             |  | Combined facilities  |  |               | 183,000 | 



Notes:



|1) | This property is subject to a sale lease-back agreement, whereby Postmedia owns the land and space above and has the right to repurchase the
building in 2041. The Corporation has accounted for this lease as a finance lease on its consolidated financial statements.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2) | This facility is currently for sale.
|-- | ------------------------------------



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ITEM 4A. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS



|A. | Operating Results.
|-- | ------------------

See Key Factors Affecting Operating Results and Operating Results in the MD&A, attached hereto as
Exhibit 15.2.



|B. | Liquidity and Capital Resources.
|-- | --------------------------------

See Liquidity and Capital Resources, Sources of Cash and Uses of Cash in the MD&A,
attached hereto as Exhibit 15.2.



|C. | Research and Development, Patents and Licenses, etc.
|-- | ----------------------------------------------------

Not applicable.



|D. | Trend Information.
|-- | ------------------

See Key Factors Affecting Operating Results in the MD&A, attached hereto as Exhibit 15.2.



|E. | Off-Balance Sheet Arrangements.
|-- | -------------------------------

See Guarantees and Off-Balance Sheet Arrangement in the MD&A, attached hereto as Exhibit 15.2.



|F. | Tabular Disclosure of Contractual Obligations.
|-- | ----------------------------------------------

See the table included in Financial Instruments and Financial Instruments Risk Management  Liquidity Risk in the
MD&A, attached hereto as Exhibit 15.2.



|G. | Safe Harbor.
|-- | ------------

See Notice Regarding Forward Looking Statements in this annual report.



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##### Table of Contents

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES



|A. | Directors and Senior Management.
|-- | --------------------------------

Name, Occupation and Security Holding

The following table identifies the name and residence of those individuals who are directors and executive officers of the Corporation as of
November 17, 2015, their current positions with the Corporation, the date on which they first became a director and/or executive officer of the Corporation and their principal occupation. The term of each of the directors expires on the date of
the Corporations upcoming annual general and special meeting of Shareholders, currently scheduled for January 13, 2016, or until the election of his or her successor, unless he or she resigns or his or her office becomes vacant by reasons
of his or her death, removal or other cause.



|                                                            |  |                                                                                       |  |                                   |  |                                                                         
|----------------------------------------------------------- |  | ------------------------------------------------------------------------------------- |  | --------------------------------- |  | ------------------------------------------------------------------------
|Name and Residence                                          |  | Position with Postmedia                                                               |  | Director /Executive
Officer Since |  | Principal Occupation if Different from
Position Held with Postmedia     
|                                                            |  |                                                                                       | 
|Rod Phillips(1)
Toronto, Ontario, Canada                    |  | Director and Chair of the Board of Directors                                          |  | February 5, 2014                  |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Paul Godfrey Toronto, Ontario, Canada                       |  | Director, President and Chief Executive Officer                                       |  | April 26, 2010                    |  |                                                                         
|                                                            |  |                                                                                       | 
|Charlotte Burke(1)(2)(5)
Toronto, Ontario, Canada           |  | Director                                                                              |  | September 20, 2010                |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Hugh F. Dow(1)(3)(5)
Toronto, Ontario, Canada               |  | Director                                                                              |  | January 6, 2011                   |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Martin Nisenholtz(1)(3)(5)
Brookline, Massachusetts, U.S.A. |  | Director                                                                              |  | February 5, 2014                  |  | Professor of the Practice of Digital Communications at Boston University
|                                                            |  |                                                                                       | 
|Jane Peverett(1)(2)(4)
Vancouver, British Columbia, Canada  |  | Director                                                                              |  | April 10, 2013                    |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Graham Savage(1)(2)(3)
Toronto, Ontario, Canada             |  | Director                                                                              |  | July 12, 2010                     |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Steven Shapiro(4)
New York, New York, U.S.A                 |  | Director                                                                              |  | July 12, 2010                     |  | Founding Partner and Portfolio Manager, GoldenTree                      
|                                                            |  |                                                                                       | 
|Peter Sharpe(1)(3)(4)
Toronto, Ontario, Canada              |  | Director                                                                              |  | June 17, 2010                     |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Robert Steacy(1)(2)(3)
Toronto, Ontario, Canada             |  | Director                                                                              |  | July 14, 2010                     |  | Corporate Director                                                      
|                                                            |  |                                                                                       | 
|Douglas Lamb Toronto, Ontario, Canada                       |  | Executive Vice President and Chief Financial Officer                                  |  | July 12, 2010                     |  |                                                                        
|                                                            |  |                                                                                       | 
|Andrew MacLeod Kitchener, Ontario,
Canada                   |  | Executive Vice President and Chief Commercial Officer                                 |  | July 7, 2014                      |  |                                                                        
|                                                            |  |                                                                                       | 
|Jeffrey Haar Toronto, Ontario, Canada                       |  | Executive Vice President, Legal and General Counsel                                   |  | January 11, 2012                  |  |                                                                        
|                                                            |  |                                                                                       | 
|Michelle Hall Toronto, Ontario, Canada                      |  | Executive Vice President, Human Resources                                             |  | July 13, 2010                     |  |                                                                        
|                                                            |  |                                                                                       | 
|Gordon Fisher Toronto, Ontario, Canada                      |  | President National Post and Executive Vice President Reader Revenue and Manufacturing |  | July 13, 2010                     |  |                                                                        
|                                                            |  |                                                                                       | 
|Gillian Akai Toronto, Ontario, Canada                       |  | Vice President, Legal Affairs and Corporate Secretary                                 |  | July 12, 2010                     |  |                                                                        



Notes:



|(1) | Independent member of the Board.
|--- | --------------------------------

|(2) | Member of the Audit Committee.
|--- | ------------------------------



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##### Table of Contents

|(3) | Member of the Compensation and Pension Committee.
|--- | -------------------------------------------------

|(4) | Member of the Corporate Governance and Nominating Committee.
|--- | ------------------------------------------------------------

|(5) | Member of the Digital Oversight Committee.
|--- | ------------------------------------------

As a group, the directors and executive officers of the Corporation, as of November 17, 2015, beneficially own or exercise control or
direction, directly or indirectly, over 161,932 Voting Shares (representing 15.71% of the total Voting Shares issued and outstanding) and 867,508 Variable Voting Shares (representing 0.31% of the total Variable Voting Shares issued and outstanding).

Biographies

The following are brief
profiles of our directors and executive officers, including a description of each individuals principal occupation within the past five years.

Rod Phillips (Chair)

Mr. Phillips was most recently President and Chief Executive Officer of the Ontario Lottery and Gaming Corporation, an Operational
Enterprise of the Ontario Ministry of Finance (OLG), which is responsible for gaming sites and the sales of lottery products across the Province of Ontario. He resigned from this position on January 22, 2014. Prior to his appointment to the
OLG, Mr. Phillips was President and Chief Executive Officer of Shepell.fgi, one of North Americas leading providers of workplace health and productivity solutions. From 1997 to 2000, Mr. Phillips served as Chief of Staff to Mayor Mel
Lastman during his first term as the leader of the newly amalgamated City of Toronto. Mr. Phillips currently sits on the boards of Discovery Air Inc., Data Group Limited and Infor Acquisition Corp. In addition, Mr. Phillips is currently
chair of the boards of the Greater Toronto CivicAction Alliance and Telus Toronto Community Board. He is also a member of the board of the Toronto International Film Festival and was the founding chair of the Centre for Addiction and Mental
Healths (CAMH) Transforming Lives Gala in support of CAMHs critical work.

Paul Godfrey (Director)

Mr. Godfrey is the President and Chief Executive Officer of Postmedia. Prior to this he served as President and Chief Executive Officer of
National Post Inc., President and Chief Executive Officer of the Toronto Blue Jays Baseball Club, and spent 16 years with Sun Media Corporation, eventually taking the role of President and Chief Executive Officer. Mr. Godfrey has a proud record
of public service including a record four terms (11 years) as the chairman of the Municipality of Metropolitan Toronto. He is chairman of the board of RioCan Real Estate Investment Trust. He also serves on the board of Cargojet Inc. and serves as
Vice Chair of Baycrest Centre for Geriatric Care.

Charlotte Burke (Director)

Ms. Burke is a corporate director and operates a consulting firm that advises senior executives on digital transformation, innovation and
growth strategies in support of shareholder value. Most recently, Ms. Burke was Chief Marketing and Sales Officer with QuickPlay Media Inc., a leading provider of IPTV solutions. During 2009 to 2015, Ms. Burke served as a senior advisor
and executive to Accenture, the Department of Foreign Affairs, Hewlett Packard, Asurion Canada and the Business Development Bank of Canada. In addition, Ms. Burke was an officer and Senior Vice President with Bell Canada from 1996 to 2008,
where she led the Consumer Internet business and Bell Mobilitys digital cellular business. Ms. Burke is also an advisor with the MaRS Ontario Innovation Center and Next 36 Young Entrepreneurs Program and serves on the boards of
Rothesay Netherwood School and Halton Health Sciences, Quality and Risk Management Committee. She was formerly on the boards of Acadia University, Ontario Lottery and Gaming Corporation, Women in Telecommunications and National Ballet School.



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Hugh F. Dow (Director)

Mr. Dow retired as chairman of Mediabrands Canada in December 2010. Prior to this, Mr. Dow was President of M2 Universal and
held global responsibilities with Universal McCann, of which M2 Universal is the Canadian arm. Mr. Dow has also held many key advertising industry positions including vice chairman of BBM Bureau of Measurement, director and chairman of Canadian
Media Directors Council, chairman of PMB Print Measurement Bureau, chairman and director of ABC Audit Bureau of Circulation, and chairman of Media Medical Audience Committee. Mr. Dow also serves as a director of Reshift Media Inc.

Martin Nisenholtz (Director)

Mr. Nisenholtz is currently Professor of the Practice of Digital Communications at Boston University and a Venture Partner of FirstMark
Capital, an early stage venture capital firm based in New York City. In January 2012, Mr. Nisenholtz retired from his full-time role at The New York Times Company where he had served as Senior
Vice President, Digital Operations and was responsible for the strategy development, operations and management of its digital properties. Prior to that, Mr. Nisenholtz was Chief Executive Officer of New York Times Digital. In
June 2001, Mr. Nisenholtz founded the Online Publishers Association, an industry trade organization that represents the interests of high-quality online publishers. Mr. Nisenholtz currently serves on the boards of Yellow Pages
Limited, a Canadian media and marketing solutions company, RealMatch, a U.S. privately held online recruitment advertising solutions company and Purch, a U.S. privately held digital publishing company.

Jane Peverett (Director)

Ms. Peverett currently serves as a director of Encana, a leading North American energy producer, as well as Northwest Natural Gas Company,
the Canadian Imperial Bank of Commerce and Hydro One Inc. She is also a director of Associated Electric & Gas Insurance Services Limited. Prior to this, Ms. Peverett was the President and Chief Executive Officer of BC Transmission
Corporation from April 2005 to January 2009, and was previously its Vice-President, Corporate Services and Chief Financial Officer. In addition, Ms. Peverett was the President and Chief Executive Officer of Union Gas Limited from
April 2002 to May 2003 after serving in various senior roles within Westcoast Energy Inc.

Graham Savage (Director)

Mr. Savage is a corporate director and, from 1997 to 2007, he was chairman and Founding Partner of Callisto Capital, a private equity
firm. Prior to that, Mr. Savage spent 21 years as a senior officer at Rogers Communications Inc. Mr. Savage is currently a director of Sears Canada Inc., Cott Corporation and is chairman of Whistler Blackcomb Holdings Inc. Mr. Savage
previously served as a director of Canadian Tire Corp., Canadian Tire Bank, Rogers Communications Inc., Sun Media Corp., Royal Group Technologies Ltd. and Hollinger International Inc., among others.

Steven Shapiro (Director)

Mr. Shapiro is a Founding Partner and Portfolio Manager at GoldenTree, and is a member of its Executive Committee. He is responsible for
the firms investments in media and communications as well as its investments in distressed assets. Prior to joining GoldenTree, Mr. Shapiro was a Managing Director in the High Yield Group at CIBC World Markets, where he headed Media and
Telecommunications Research. He is a member of the boards of various corporate and not-for-profit entities, including Source Home Entertainment, Inc., the holding company of Source Interlink, Granite Broadcasting, Southern Community Newspapers, Inc.
and James Cable, LCC.



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##### Table of Contents

Peter Sharpe (Director)

Mr. Sharpe retired as President and Chief Executive Officer of Cadillac Fairview Corporation in 2010, having served with the company for
over 25 years. Mr. Sharpe is currently a director of Multiplan Empreendimentos Imobiliários S.A., Morguard Corporation, First Industrial REIT (US), and Allied Property REIT. Mr. Sharpe is also a past chairman and current Trustee of
the International Council of Shopping Centers.

Robert Steacy (Director)

Mr. Steacy retired in 2005 after spending more than 16 years as the Senior Financial Officer of Torstar Corporation. Mr. Steacy is
the chairman of the board of Domtar Corporation and chair of the audit committee of Cineplex Inc. From 2005 to 2007 he served on the boards of Alliance Atlantis Communications Inc. and Somerset Entertainment Income Fund, and was a director of
Canadian Imperial Bank of Commerce from 2008 to 2012.

Douglas Lamb (Executive Vice President and Chief Financial Officer)

Mr. Lamb was appointed as Executive Vice President and Chief Financial Officer of Postmedia in July 2010. Prior to that, he was
Executive Vice President and Chief Financial Officer of Canwest LP since 2005. He is a veteran Canadian newspaper executive. Mr. Lamb also served as Vice President of Corporate Development of Metroland, the community publishing business of
Torstar Corporation. Prior to his employment with Torstar Corporation, he held a variety of financial roles at Hollinger International Inc. and Southam Inc.

Andrew MacLeod (Executive Vice President and Chief Commercial Officer)

Mr. MacLeod was appointed as Executive Vice President and Chief Commercial Officer of Postmedia in July 2014. Prior to that, he was most
recently Senior Vice President & Regional Managing Director, North America at BlackBerry Limited, previously holding a variety of roles within that organization including Vice President and Managing Director, Canada beginning in October
2011 and Director of Business Management beginning in October 2010. Prior to his employment at BlackBerry Limited, Mr. MacLeod worked at OnX Enterprise Solutions and Xerox Canada Ltd.

Jeffrey Haar (Executive Vice President, Legal and General Counsel)

Mr. Haar was appointed as Executive Vice President, Legal and General Counsel of the Corporation in 2012. Mr. Haar was previously
Senior Vice President, Legal & Corporate Secretary at Brookfield Asset Management. Mr. Haar has also served as General Counsel and Corporate Secretary for a number of public and private companies, including Architel Systems
Corporation, which was acquired by Nortel Networks in 2000. Prior to Architel, Mr. Haar was in private practice at Skadden, Arps, Slate, Meagher & Flom LLP in Toronto, Ontario and at Shearman & Sterling LLP in New York,
New York.

Michelle Hall (Executive Vice President, Human Resources)

Ms. Hall was appointed as Executive Vice President, Human Resources in 2012 after serving as Senior Vice President, People since 2010. She
oversees the development and implementation of the Corporations human resources strategy. Previously she served as Senior Vice President, People for a predecessor Canwest LP entity from 2008 to 2010 and Vice President, Human Resources of
the Canadian operations of Canwest Media Inc. between 2005 and 2008. Prior to joining Canwest, Ms. Hall held senior level human resources roles at a variety of organizations, most recently at the Canada Life Assurance Company.



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Gordon Fisher (President National Post and Executive Vice President, Reader Revenue and Manufacturing)

Mr. Fisher was appointed President National Post and Executive Vice President, Reader Revenue and Manufacturing in August
2015. Prior to that, Mr. Fisher served as President, Pacific Newspaper Group of Postmedia beginning in January 2013 and President of National Post and the Executive Vice President, Eastern Canada of Postmedia beginning in July 2010. Previously,
he served as Publisher of the National Post under a predecessor Canwest LP entity. Mr. Fisher has an extensive media background. He has held a number of senior executive positions in many Canadian cities on both the editorial and business sides
of the media industry. Prior to his appointment as Publisher of the National Post, Mr. Fisher served as President, News and Information, Canwest Global Communications Corp., with responsibilities covering newspaper, television and digital
information. Other responsibilities of note include roles as editor-in-chief, general manager and publisher of the Ottawa Citizen; publisher of the Kingston-Whig Standard and managing editor of the Vancouver Sun.

Gillian Akai (Vice President, Legal Affairs and Corporate Secretary)

Ms. Akai was appointed to the role of Vice President, Legal Affairs and Corporate Secretary in July 2010. Previously she served as
Director, Legal Affairs/Legal Counsel for Canwest Media Inc. from April 2006 to July 2010. Ms. Akai was previously in private legal practice in the Toronto office of Fraser Milner Casgrain LLP (now Dentons LLP).

Cease Trade Orders or Bankruptcies

Other
than as described below, no director, nominee or executive officer of Postmedia is, or within ten years before the date hereof, has been a director, chief executive officer or chief financial officer of any company (including Postmedia) that,
(i) was subject to an order that was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial officer, or (ii) was subject to an order that was issued after the
director or officer ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial
officer. For the purposes of the preceding sentence, order means; (a) a cease trade order; (b) an order similar to a cease trade order; or (c) an order that denied the relevant company access to any exemption under
securities legislation.

Other than as described below, to the knowledge of the Corporation, no director, nominee or executive officer, or
Shareholder holding a sufficient number of securities to affect materially the control of Postmedia: (a) is at the date hereof, or has been within ten years before the date hereof, a director or executive officer of any company (including
Postmedia) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or
instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or (b) has, or within ten years before the date hereof, become bankrupt, made a proposal under any
legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the director, executive
officer or Shareholder.

On October 6, 2009, the subordinate voting shares and the non-voting shares of Canwest Global were suspended
from trading on the TSX while a review to determine whether the company was meeting the continued listing requirements was conducted. On October 15, 2009, Canwest Global received a notice from the TSX informing the company that its subordinate
voting shares and non-voting shares would be delisted from the exchange effective November 13, 2009 for failure to meet the continued listing requirements. In response to this notice, on November 13,
2009, Canwest Global announced that its subordinate voting shares and non-voting shares would begin trading on the TSX Venture Exchange effective November 16, 2009. Mr. Godfrey, the President and Chief Executive Officer of Postmedia and
Mr. Lamb, Executive Vice President and Chief Financial Officer of Postmedia, were senior officers of certain subsidiaries of Canwest Global throughout the period described above.



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Prior to their mandates with Postmedia, Messrs. Godfrey, Lamb, and Ms. Hall were
executive officers of certain of the LP Entities or one of the LP Entities wholly-owned subsidiaries. On January 8, 2010, the Ontario Superior Court of Justice issued an order that, among other things, granted the LP Entities protection
from their creditors under the CCAA. Postmedia acquired substantially all of the newspaper and digital media businesses previously owned by the LP Entities pursuant to a plan of compromise or arrangement that was implemented during the course of the
LP Entities proceedings under the CCAA. On April 24, 2013, the Ontario Superior Court of Justice made an order terminating the CCAA proceedings of the LP Entities.

Mr. Godfrey served on the board of directors of Mobilicity (formerly known as Data & Audio Visual Enterprises Mobilicity) from
November 20, 2008 to April 30, 2013. Mobilicity sought and received CCAA protection on September 30, 2013.

Mr. Savage
was a director of Microcell Inc. when it filed for protection under the CCAA.Mr. Savage was a director of Sun-Times Media Group, Inc. (Sun Times), formerly Hollinger
International Inc. (Hollinger). He served as a director of that company from July, 2003 until November, 2009. On June 1, 2004, the Ontario Securities Commission issued a permanent management cease trade order (the
Ontario Cease Trade Order) against the insiders of Hollinger for failing to file its interim financial statements and interim managements discussion and analysis for the three-month period ended March 31, 2004 and its
annual financial statements, managements discussion and analysis and annual information form for the year ended December 31, 2003. In addition, the British Columbia Securities Commission issued a cease trade order against an insider of
Hollinger resident in British Columbia on May 21, 2004, as updated on May 31, 2004 (the BC Cease Trade Order). The Ontario Cease Trade Order was allowed to expire on January 9, 2006 and is no longer in effect. The
BC Cease Trade Order was revoked on February 10, 2006 and is no longer in effect. Sun Times filed for protection under Chapter 11 of the United States Bankruptcy Code (USBC) in April 2009.

Mr. Shapiro was a director of Readers Digest Association Inc. (Readers Digest) until August 2009.
Readers Digest filed for protection under Chapter 11 of the USBC in August 2009, after Mr. Shapiros departure from its board.

Mr. Lodge served as a director to Source Home Entertainment, LLC (Source), a Delaware limited liability company that filed
a voluntary petition under Chapter 11 of the USBC on June 23, 2014. Source remains under the protection of the Delaware Bankruptcy Court as it proceeds with its restructuring.

Mr. Nisenholtz was appointed to the Board of Trustees of Yellow Pages Income Fund, a predecessor of Yellow Media Inc., on May 9,
2006. Upon the conversion of the fund into a Canadian corporation on November 1, 2010, Mr. Nisenholtz became a director of Yellow Media Inc. Yellow Media Inc. announced a recapitalization on July 23, 2012 which was implemented and
became effective on December 20, 2012 (the Yellow Media Recapitalization). The Yellow Media Recapitalization was implemented in accordance with a court approved Plan of Arrangement under the CBCA pursuant to which the former
securities of Yellow Media Inc. and all entitlements relating thereto were exchanged and cancelled for, as applicable, cash and common shares and warrants of Yellow Media Limited, and new senior secured notes and new senior subordinated exchangeable
debentures of YPG Financing Inc. (formerly known as Yellow Media Inc.). YPG Financing Inc. is a wholly-owned subsidiary of Yellow Media Limited. The Yellow Media Recapitalization reduced the corporations debt, including preferred shares, by
approximately $1.5 billion.

Penalties or Sanctions

To the knowledge of the Corporation, no director, nominee or executive officer or Shareholder holding a sufficient number of securities to
affect materially the control of Postmedia, has been subject to: (a) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a
securities regulatory authority; or (b) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable investor in making an investment decision.



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Conflicts of Interest

Pursuant to a nominating agreement, GoldenTree has the right to select one individual to be nominated to serve as director on the Board, see
Item 6.A  Directors and Senior Management  Nominating Agreement. GoldenTrees current nominee on the Board is Mr. Shapiro, who is a Founding Partner and Portfolio Manager at GoldenTree, and is a member of its
Executive Committee. GoldenTrees proposed nominee for election to the Board at the annual general and special meeting currently scheduled for January 13, 2016 is Mr. Lodge, who is a Partner of GoldenTree Asset Management LP.
GoldenTree is located at 300 Park Avenue, 21st Floor, New York, New York, 10022 U.S.A. GoldenTree, and certain investment funds for which it serves as investment advisor, own 146,694,259 Variable Voting Shares as at November 17, 2015 (see
Item 7  Major Shareholders and Related Party Transactions) and a portion of the First-Lien and Second-Lien Notes, both as issued by Postmedia Network Inc. GoldenTrees combined debt and equity holdings may give rise to
a potential conflict of interest.

Nominating Agreement

On July 13, 2010 Postmedia entered into a nominating agreement with GoldenTree, a principal Shareholder. Pursuant to this agreement, for
so long as GoldenTree (or certain investment funds for which GoldenTree serves as investment adviser) beneficially owns or exercises control or direction over a minimum of 10% of the outstanding Shares of Postmedia, GoldenTree has the right to
select one individual, who shall be presented to the Shareholders of Postmedia as part of managements proposed list of nominees to serve as a director on the Board of Postmedia at any Shareholder meeting at which directors of Postmedia are
being elected. GoldenTrees current nominee on the Board is Mr. Shapiro and its proposed nominee for election to the Board at the annual general and special meeting currently scheduled for January 13, 2016 is Mr. Lodge. Upon
termination of the nominating agreement; the then current nominee of GoldenTree shall fulfill his or her term as member of the Board and GoldenTree shall cease to have any nomination rights on a going forward basis.



|B. | Compensation.
|-- | -------------

The following discussion and analysis examines the compensation earned by: (a) the Corporations President and Chief Executive
Officer (the CEO); (b), the Corporations Executive Vice President and Chief Financial Officer (the CFO); (c) the Corporations three other most highly compensated executive officers, who served
as executive officers of the Corporation for Fiscal 2015; and (d) each individual who would have satisfied the conditions in (c) above but for the fact that the individual was neither an executive officer of the Corporation, nor acting in
a similar capacity at the end of Fiscal 2015 (collectively, the Named Executive Officers or NEOs), who served as executive officers of the Corporation for Fiscal 2015. In addition, it describes and explains
Postmedias compensation philosophy and objectives and the significant elements of compensation of the Corporations NEOs during Fiscal 2015.

The NEOs for Fiscal 2015 were:



| |  |  | Paul Godfrey, President and Chief Executive Officer
| | - |  | ---------------------------------------------------



| |  |  | Douglas Lamb, Executive Vice President and Chief Financial Officer
| | - |  | ------------------------------------------------------------------



| |  |  | Wayne Parrish, Chief Operating Officer(1)
| | - |  | -----------------------------------------



| |  |  | Andrew MacLeod, Executive Vice President and Chief Commercial Officer
| | - |  | ---------------------------------------------------------------------



| |  |  | Gordon Fisher, President, National Post and Executive Vice President Reader Revenue and Manufacturing
| | - |  | -----------------------------------------------------------------------------------------------------



| |  |  | Jeffrey Haar, Executive Vice President, Legal and General Counsel
| | - |  | -----------------------------------------------------------------



Notes:



|(1) | Mr. Parrishs employment with the Corporation ended July 6, 2015.
|--- | -----------------------------------------------------------------



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Executive Compensation Components and Their Objectives

Postmedias executive compensation program is comprised of the following compensation components:



| |  |  | base salary;
| | - |  | ------------



| |  |  | annual short-term incentives (annual bonuses);
| | - |  | ----------------------------------------------



| |  |  | long-term incentives, which include stock options, restricted share units and performance share units;
| | - |  | ------------------------------------------------------------------------------------------------------



| |  |  | benefits and perquisites; and
| | - |  | -----------------------------



| |  |  | pension.
| | - |  | --------

The
primary objective of the Corporations executive compensation program is to attract and motivate key executives to carry out business strategies that are aligned with the creation of Shareholder value. The level of compensation paid to each NEO
is based on the executives qualifications, experience, responsibility and performance.

(i) Salary

Base salary remunerates executives for discharging job requirements. The NEOs base salary represents a fixed level of cash compensation and it
is reviewed annually by the Compensation and Pension Committee, for recommendation to the Board for approval. The goal is to ensure that each NEO is paid competitively, taking into consideration the requirements of the position, the executives
performance, knowledge, skills, experience and equity with other executives within Postmedia and compared to the external market for competitiveness. The Corporations policy is to target base salary compensation for the NEOs at the median
level or just above, based on external market considerations, organizational and individual performance. The NEOs total compensation is considered based upon a review of the comparator peer group recommended by an independent consultant (see
Item 6C. Board Practices  Competitive Benchmarking).

(ii) Annual Short-Term Incentive Plan

The annual short-term incentive plan (STIP) represents variable cash compensation. Short-term incentive targets for the NEOs
are expressed as a percentage of base salary and are determined based on competitive market practices. The Compensation and Pension Committee recommends for approval by the Board the short-term incentive plan design, performance measures, weightings
and targets for each fiscal year.

The Corporations policy is to target short-term incentives at median of the comparator peer group
for the NEOs with the purpose of being externally competitive and incenting for maximum performance to achieve the Corporations goals.

In designing the STIP, the goal is to align the payouts with the business strategy and to motivate plan participants to achieve defined goals.
The CEO is eligible for 100% of base salary at target and the other NEOs are eligible for 50% of base salary at target. The short-term incentives all have a maximum payout opportunity equal to 150% of target.

For Fiscal 2015, consistent with the prior fiscal year the Board provided the CEO with discretion to recommend an adjustment on incentive
bonus payments under the STIP subject to the performance of pre-defined and pre-approved criteria (the Discretionary Payout). The Discretionary Payout is subject to Board approval and cannot exceed an established fixed percentage
of the overall STIP. The payout is capped at 150% of target (including any Discretionary Payout).

The CEO STIP plan design for Fiscal
2015 remained the same as the prior fiscal year, with the minimum payout threshold set at 80% of the; performance target. The payout is capped at 150% when performance reaches 120% of target. The target payout is increased with each percentage of
the performance achievement between 80% and 120% of target with set increments.



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The STIP plan for the other NEOs remained the same as the prior fiscal year with the minimum
payout threshold set at 85% of performance target. The payout is capped at 150% of target when performance achievement reaches 125% of performance target. The target payout is increased with each percentage of the performance achievement between 85%
and 125% with set increments.

In October 2015, the Board approved a plan payout for Fiscal 2015 based upon the level of achievement
of the target (established for purposes of the STIP) based on the corporate performance of consolidated operating income before depreciation amortization, impairment and restructuring (the Consolidated Operating Profit Target).
The threshold performance target described above was met for the CEO, but was not met for the other NEOs. The Compensation and Pension Committee sets the targets for the STIP based on the organizational strategic plan and budget. Targets reflect the
challenges facing the publishing industry and align with industry trends.

The Consolidated Operating Profit Target established for the
STIP for Fiscal 2015 was $109.5 million, whereas the actual achievement was $90.4 million. The determination of consolidated operating income before depreciation amortization, impairment and restructuring for Fiscal 2015 excludes the operating
income before depreciation, amortization, impairment and restructuring of the properties acquired as part of the Sun Acquisition.

In
recognition of the extensive additional work undertaken by the NEOs, among others, in connection with the Sun Acquisition and the integration of the properties acquired, a special transaction bonus was approved by the Board. In addition to the
payout to Mr. Godfrey referenced in the below table, Messrs. Godfrey, Lamb, Parrish, MacLeod, Fisher and Haar received discretionary bonuses related to the Sun Acquisition of $400,000, $200,000, $150,000, $50,000, $25,000 and $100,000,
respectively. The amounts were accrued in Fiscal 2015 and were paid in full with the exception of $200,000, $100,000, $25,000 and $50,000 related to Messrs. Godfrey, Lamb, MacLeod and Haar respectively which will be payable on December 31, 2015
provided they are still employed with the Corporation.

The following table sets forth the short-term incentive award targets and the
payout achievement of these targets in Fiscal 2015 for the NEOs of the Corporation:



|                 |  |                                                  |  |                              |  |                             
|---------------- |  | ------------------------------------------------ |  | ---------------------------- |  | ----------------------------
|PARTICIPANT NAME |  | FISCAL 2015 TARGETPAYOUT (as a %
of base salary) |  | FISCAL 2015 TARGET PAYOUT($) |  | FISCAL 2015 ACTUALPAYOUT
($)
|Paul Godfrey     |  | 100%                                             |  | 950,000                      |  | 118,750                     
|Douglas Lamb     |  | 50%                                              |  | 225,000                      |  |                            
|Wayne Parrish    |  | 50%                                              |  | 237,500                      |  |                            
|Andrew MacLeod   |  | 50%                                              |  | 212,500                      |  |                            
|Gordon Fisher    |  | 50%                                              |  | 200,000                      |  |                            
|Jeffrey Haar     |  | 50%                                              |  | 150,000                      |  |                            

(iii) Long-Term Incentive Plans

The Corporation has an Option Plan (as defined below) and a RSU Plan (as defined below) that are intended to, among other things, attract,
motivate and retain certain executive officers and other grantees and align their interests with the interests of Shareholders. The long-term incentive programs are designed to reward performance up to a ten year period, and vest up to a four year
period, and are provided to senior leaders in value driven roles and key contributors who are critical to the organizations future. For more information, see Item 6B. Compensation  Incentive Plan Awards - Stock Option Plan and
RSU Plan.



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The Compensation and Pension Committee reviews several factors on an annual basis when
determining Option and RSU grants, including the total target compensation levels of the comparator peer group, the current size of the reserve pool available, and the previous years grants, among other things. The Compensation and Pension
Committee recommends to the Board the long-term incentive plan design of the plan as well as the number of awards to be granted to the NEOs.

In Fiscal 2016, in order to enhance the link between executive compensation and key business objectives, and align with good corporate
governance practices, the Board have approved amendments to the RSU Plan which would allow performance share units (PSUs), a form of RSUs, to be granted to executives under the RSU Plan. Specifically, the amendments were to modify
the definition of Vesting Date and Vesting Terms to contemplate that RSUs may be subject to time conditions and/or performance conditions (as in the case of PSUs), rather than only time conditions.

The average mix of long-term incentives for Fiscal 2016 for the NEOs is expected to be 70% Options and 30% PSUs. It is also expected that
annual grants will be made under these plans in order to provide rolling retention periods for the executives.

(iv) Benefits and Perquisites

Although not considered a primary element of the compensation program, the Corporation provides a market competitive package of
executive level benefits and perquisites for its NEOs. The executive group benefits program includes health, dental, life insurance, wellness, short-term and long-term disability coverage. Perquisites provided to the NEOs consist of car allowances,
parking and club memberships, with a car lease available to the CEO. The level of benefits and perquisites are determined based on guidelines that have been established under an executive compensation total rewards framework.

(v) Pension Plans

Postmedia maintains a
defined benefit pension plan (the DB Plan), however, the DB Plan was closed to new members and replaced with a defined contribution plan (the DC Plan) in Fiscal 2013. The DB Plan and the DC Plan are collectively
referred to as the Pension Plans. Postmedia does not offer a supplemental executive retirement plan.

Messrs. Lamb and
Haar participates in the DB Plan. Mr. Parrish participated in the DB Plan while employed with the Corporation. Mr. MacLeod participates in the DC Plan. Mr. Godfrey is not eligible to participate in any of the Corporations
Pension Plans as he has exceeded the maximum age to be eligible to participate in a registered pension plan. Mr. Fisher receives a pension benefit under the DB Plan.

The DB Plan formula takes into consideration the members pensionable earnings and credited service along with the maximum Canada Pension
Plan levels. The formula is: 1.25% multiplied by the final average earnings up to the average yearly maximum pensionable earnings multiplied by the credited service plus 1.75% multiplied by the final average earnings in excess of the average yearly
maximum pensionable earnings multiplied by the credited service. The final average earnings are calculated using the average of the members best five years of pensionable earnings during the last ten years prior to retirement or termination.
The executive officers that participate in the DB Plan contribute 2.5% of their pensionable earnings up to the yearly maximum pensionable earnings and 5% thereafter.

The DB Plan also provides an early retirement subsidy to all participants who take early retirement following the attainment of both age 62
and ten years of continuous service. A participant retiring after age 55 but before age 62 can receive an early retirement pension reduced by a factor of one-third of 1% for each complete month by which the early retirement date precedes age 62. A
participant with ten or more years of continuous years of service may elect to receive an unreduced deferred retirement income payable at age 62. For a participant retiring after age 55 but before age 65 with less than ten years of continuous
employment, the pension is reduced by a factor of one-third of 1% for each complete month by which the early retirement date precedes the normal retirement date, which is 65.



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The DC formula is based on contributions made by the participating employee and Postmedia and the
gains and losses of the investments. The DC Plan includes a 5% employee contribution and Postmedia matches the employee contribution at 100%.

The maximum pension payable under the Pension Plans is as prescribed by the Tax Act.

Defined Benefit Plan Table

The
following table sets forth the pension benefits and entitlements under the DB Plan as at August 31, 2015:



|                 |  |                                  |  |                             |  |                                                      |  |                           |  |                               |  |                                                         |  |        
|---------------- |  | -------------------------------- |  | --------------------------- |  | ---------------------------------------------------- |  | ------------------------- |  | ----------------------------- |  | ------------------------------------------------------- |  | -------
|PARTICIPANT
NAME |  | NUMBEROF YEARSCREDITEDSERVICE(#) |  | ANNUAL BENEFITS PAYABLE ($) |  | OPENINGPRESENT VALUE
OF DEFINEDBENEFITOBLIGATION ($) |  | COMPENSATORYCHANGE(1) ($) |  | NON-COMPENSATORYCHANGE(2) ($) |  | CLOSINGPRESENT VALUE
OF DEFINEDBENEFITOBLIGATION(3) ($)
|                 |  |                                  |  | AT YEAREND                  |  | AT AGE65                                             |  |                           |  |                               |  |                                                         |  |        
|Douglas Lamb     |  | 3.67                             |  | 10,300                      |  | 43,200                                               |  | 99,200                    |  | 17,900                        |  | 15,700                                                  |  | 132,800
|Wayne Parrish    |  | 3.83(4)                          |  | 10,800                      |  | 25,400                                               |  | 112,700                   |  | 18,400                        |  | 16,900                                                  |  | 148,000
|Gordon Fisher    |  | 21.33(5)                         |  | 52,600(5)                   |  | 52,600(5)                                            |  | 764,800                   |  |   (5)                        |  | (26,600)(6)                                             |  | 738,200
|Jeffrey Haar     |  | 3.33                             |  | 9,400                       |  | 53,800                                               |  | 73,000                    |  | 16,500                        |  | 16,600                                                  |  | 106,100



Notes:



|(1) | Compensatory change represents the normal cost net of employee contributions.
|--- | -----------------------------------------------------------------------------

|(2) | Non-compensatory change includes interest on the present value of the DB Plan obligation and employee contributions made during Fiscal 2015, and all
assumption changes.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | An actuarial valuation of the DB Plan was completed as at December 31, 2013 for funding purposes and these results were extrapolated to
August 31, 2015 for accounting purposes. The present value of the obligation was determined using the Projected Unit Credit Method pro-rated on service. Calculations are made based upon a discount rate assumption of 4.05%.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Mr. Parrishs employment with the Company ended July 6, 2015 at which time he terminated from the DB Plan with 3.68 years of actual
credited service.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Mr. Fisher is currently receiving annual benefits under the DB Plan of $52,600 based on an election of joint and survivor pension and credited
service of 21.33 years at attainment of the pension benefit. Mr. Fishers annual benefits payable at August 31, 2015 and at age 65 are the same; therefore, there is no compensatory change.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) | Mr. Fishers non-compensatory change is negative since it reflects the reduction in DB Plan obligation due to payment of pension benefits
and changes in assumptions from prior year.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Defined Contribution Plan Table

The following table sets forth the pension benefits and entitlements under the DC Plan as at August 31, 2015:



|                 |  |                                           |  |                     |  |                                 
|---------------- |  | ----------------------------------------- |  | ------------------- |  | --------------------------------
|PARTICIPANT NAME |  | ACCUMULATED VALUE AT STARTOF
THE YEAR ($) |  | COMPENSATORY(1) ($) |  | ACCUMULATED VALUE AT YEAREND ($)
|Andrew MacLeod   |  |                                          |  | 16,200              |  | 30,700                          



Notes:



|(1) | Reflects employer contributions.
|--- | --------------------------------



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##### Table of Contents

Summary Compensation Table

The following table summarizes the annual compensation provided for services rendered to Postmedia by its NEOs for Fiscal 2015, 2014 and 2013:



|                                                                                                     |  |  |               |  |  |  |                        |      |  |  |                      |  |  |  |                          |         |  |  |                                          |     |  |  |                         |  |  |  |                              |  |  |  |                         |             |  |  |                              | 
|---------------------------------------------------------------------------------------------------- |  |  | ------------- |  |  |  | ---------------------- | ---- |  |  | -------------------- |  |  |  | ------------------------ | ------- |  |  | ---------------------------------------- | --- |  |  | ----------------------- |  |  |  | ---------------------------- |  |  |  | ----------------------- | ----------- |  |  | ---------------------------- | 
|NAME AND PRINCIPAL POSITION                                                                          |  |  | FISCALYEAR    |  |  |  | SALARY($)              |      |  |  | SHARE-BASEDAWARDS($) |  |  |  | OPTION-BASEDAWARDS(1)($) |         |  |  | NON-EQUITYINCENTIVE PLANCOMPENSATION ($) |     |  |  | PENSIONVALUE(3) ($)     |  |  |  | ALL OTHERCOMPENSATION(4) ($) |  |  |  | TOTALCOMPENSATION(1)($) |            
|                                                                                                     |  |  |               |  |  |  |                        |      |  |  |                      |  |  |  |                          |         |  |  | ANNUALSHORT-TERMINCENTIVEPLANS(2)        |     |  |  | LONG-TERMINCENTIVEPLANS |  |  |  |                              |  |  |  |                         |             |  |  |                              | 
|                                                                                                     |  |  |               |  |  |  |                        |      | 
|Paul Godfrey (5)President and ChiefExecutive Officer                                                 |  |  | 20152014
2013 |  |  |  | 950,000950,000
950,000 |      |  |  |   
               |  |  |  | 96,000188,000
          | (6) (9) |  |  | 518,75099,750
579,500                    | (7) |  |  |   
                  |  |  |  |   
                       |  |  |  | 194,036181,638 151,338  | (8) (8)
(8) |  |  | 1,758,7861,419,388
1,680,838 | 
|                                                                                                     |  |  |               |  |  |  |                        |      | 
|Douglas LambExecutive Vice Presidentand Chief Financial Officer                                      |  |  | 20152014
2013 |  |  |  | 450,000450,000
450,000 |      |  |  |   
               |  |  |  | 32,00061,100
           | (6) (9) |  |  | 200,000
62,437                          | (7) |  |  |   
                  |  |  |  | 17,90014,000
16,400          |  |  |  |   
                  |             |  |  | 699,900525,100
528,837       | 
|                                                                                                     |  |  |               |  |  |  |                        |      | 
|Wayne ParrishChief Operating Officer                                                                 |  |  | 20152014
2013 |  |  |  | 402,123475,000
475,000 | (10) |  |  |   
               |  |  |  | 32,00061,100
           | (6) (9) |  |  | 125,000
65,906                          | (7) |  |  |   
                  |  |  |  | 18,40016,200
18,100          |  |  |  | 1,044,706
            | (11)        |  |  | 1,622,229552,300
559,006     | 
|                                                                                                     |  |  |               |  |  |  |                        |      | 
|Andrew MacLeodExecutive Vice Presidentand Chief Commercial Officer                                   |  |  | 20152014
2013 |  |  |  | 425,00064,568
        | (12) |  |  |   
               |  |  |  | 32,000
                | (6)     |  |  | 50,000
                                | (7) |  |  |   
                  |  |  |  | 16,200
                    |  |  |  | 74,26156,989
          | (13) (13)   |  |  | 597,461121,557
             | 
|                                                                                                     |  |  |               |  |  |  |                        |      | 
|Gordon FisherPresident, National Post and Executive Vice President, Reader Revenue and Manufacturing |  |  | 20152014
2013 |  |  |  | 400,000400,000
400,000 |      |  |  |   
               |  |  |  | 9,60014,100
            | (6) (9) |  |  | 25,000
71,417                           | (7) |  |  |   
                  |  |  |  |   
                       |  |  |  | 145,557
366,000        | (14) 
(14)  |  |  | 580,157414,100
837,417       | 
|                                                                                                     |  |  |               |  |  |  |                        |      | 
|Jeffrey HaarExecutive Vice President,Legal and General Counsel                                       |  |  | 20152014
2013 |  |  |  | 300,000300,000
300,000 |      |  |  |   
               |  |  |  | 19,20037,600
           | (6) (9) |  |  | 100,000
41,625                          | (7) |  |  |   
                  |  |  |  | 16,50011,000
12,700          |  |  |  |   
                  |             |  |  | 435,700348,600
354,325       | 



Notes:



|(1) | The total compensation value includes the estimated value of the Options granted during the applicable fiscal periods as determined using the
Black-Scholes option pricing model as this is an acceptable methodology in accordance with International Financial Reporting Standards. Option-based awards only represent an estimated value of the Options granted and do not represent cash received
by the NEOs. This amount is at risk and may be equal to zero. Accordingly, the total compensation value does not represent the true cash compensation earned by the NEOs. The class of Shares underlying the Options is determined at the discretion of
the Board. Since October 2013, the class of Shares underlying the Options has been Variable Voting Shares.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The annual short-term incentive plan compensation relates to the fiscal year in which it was accrued and will be paid in the following fiscal year.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | For more information, see the Pension Plan  Defined Benefit Plan Table as at August 31, 2015 and Pension Plan
 Defined Contribution Plan Table as at August 31, 2015.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | The value of benefits and perquisites for the NEOs, other than Mr. Godfrey, do not exceed either $50,000 or 10% of the NEOs annual
salary, and are therefore not included in All Other Compensation.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Mr. Godfrey does not receive any compensation for serving as director of the Corporation.
|--- | -----------------------------------------------------------------------------------------



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##### Table of Contents

|(6) | Messrs. Godfrey, Lamb, Parrish, MacLeod, Fisher and Haar were granted 150,000, 50,000, 50,000, 50,000, 15,000 and 30,000 Options, respectively, on
January 28, 2015. The Options had a grant date fair value of $0.64 which was determined using the Black-Scholes option pricing model. Key assumptions used in the model were an exercise price of Shares of $1.90, risk free rate of interest of
0.66% based on the Bank of Canada five year benchmark bond yield in effect on the date of grant, dividend yield of nil, a volatility factor of 37.57% based on the volatility of the Corporations Shares and an expected life of options of five
years based partly on contractual terms and a published academic study. The Options expire on October 24, 2024.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | This amount includes a discretionary transaction bonus for Messrs. Godfrey, Lamb, Parrish, MacLeod, Fisher and Haar of $400,000, $200,000,
$150,000, $50,000, $25,000 and $100,000, respectively. The amounts were accrued in Fiscal 2015 and were paid in full with the exception of $200,000, $100,000, $25,000 and $50,000 related to Messrs. Godfrey, Lamb, MacLeod and Haar, respectively,
which will be payable on December 31, 2015 provided they are still employed with the Corporation.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) | This amount includes entertainment expenses totaling $117,113 (2014 - $109,976 and 2013 - $79,742).
|--- | ---------------------------------------------------------------------------------------------------

|(9) | Messrs. Godfrey, Lamb, Parrish, Fisher and Haar were granted 200,000, 65,000, 65,000, 15,000 and 40,000 Options, respectively, on February 24,
2014. The Options had a grant date fair value of $0.94 which was determined using the Black-Scholes option pricing model. Key assumptions used in the model were an exercise price of Shares of $2.02, risk free rate of interest of 1.38% based on the
Bank of Canada five year benchmark bond yield in effect on the date of grant, dividend yield of nil, a volatility factor of 52.73% based on the volatility of the Corporations Shares and an expected life of options of five years based partly on
contractual terms and a published academic study. The Options expire on October 24, 2023.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | Mr. Parrishs employment with the Corporation ended July 6, 2015. Mr. Parrishs salary on an annualized basis in Fiscal
2015 was $475,000.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------

|(11) | This amount includes severance received upon termination of Mr. Parrishs employment in Fiscal 2015.
|---- | ----------------------------------------------------------------------------------------------------

|(12) | Mr. MacLeod commenced employment with the Corporation July 7, 2014. Mr. MacLeods salary, on an annualized basis in Fiscal
2014, was $425,000.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------

|(13) | This amount includes a guaranteed bonus for Fiscal 2015 of $74,261 (2014 - $31,989) and a signing bonus for Fiscal 2014 of $25,000.
|---- | -----------------------------------------------------------------------------------------------------------------------------------

|(14) | This amount includes a discretionary retention bonus for Fiscal 2015 of $145,557 (2013 - $366,000). The Corporation may consider similar payments
in future years.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

Performance Graph

The graph set out below illustrates the cumulative total return over the period from June 14, 2011 (Postmedias listing date on the
TSX) to August 31, 2015, of a $100 investment in the Voting Shares and Variable Voting Shares as compared to the S&P / TSX Composite Index.

The year-end values of each investment are based solely on the change in the underlying Share price as no dividends were paid. The
calculations exclude brokerage fees and any applicable taxes. The following graph shows the total Shareholder returns from each investment that may be calculated from the applicable year-end investment values shown below the graph.



LOGO



Note:

The data points in the performance graph above reflect the initial investment of $100 on June 14, 2011; the investments
performance for the period covering June 14, 2011 to August 31, 2011; and the investments performance for the years ending August 31, 2012, 2013, 2014 and 2015.

Pay For Performance

The
Corporation evaluates and considers the compensation of the NEOs with a pay for performance perspective. Although a portion of the NEOs aggregate compensation as shown in the Executive compensation -Summary Compensation
Table is composed of option-based awards, which link part of the NEOs compensation with the underlying performance of the Shares and thereby with Shareholder returns, the Compensation and Pension Committee does not base its
compensation decisions on the trading price of the Shares of the Corporation. The Compensation and Pension Committee believes the trading price of the Shares is affected by external factors over which the Corporation has little or no control and
certain of these external factors do not necessarily reflect the operating performance of the Corporation. Compensation payouts are based on key financial targets that reflect the organizational strategic plan and budgets. Over the period from
June 14, 2011 to August 31, 2015, there was no correlation between the trading price of the Shares and the Companys compensation to the NEOs, except to the extent that the value of the Options held by such NEOs have experienced a
decrease in value as a result of the decrease in the trading price of the Shares. Compensation plans are working as expected as shown in the Executive Compensation -Summary Compensation Table, indicated by the differentiation in
payouts based on achievement of targets.



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##### Table of Contents

Incentive Plan Awards

Stock Option Plan

The stock option
plan (the Option Plan) is intended to assist the Corporation in attracting, motivating and retaining officers and employees by granting the right to purchase Shares (Options), as applicable, under the Option
Plan, in order to allow them to participate in the long-term success of the Corporation and to promote a greater alignment of their interests with the interests of the Shareholders of the Corporation.

Under the Option Plan, Options may be granted to participants in respect of unissued Shares. Participants are current full-time or part-time
officers, employees or consultants of Postmedia or certain related entities (herein referred to as Participants). The Option Plan is administered by the Board (the Plan Administrator). In administering the
Option Plan, the Plan Administrator may determine, among other things, Participants to whom Options are granted and the amounts, terms and conditions relating to Options, including the exercise price, and the time(s) when and circumstances under
which Options become exercisable.

The maximum number of Shares that may be reserved for issuance at any time for the exercise of Options
under the Option Plan is 3,000,000 Shares (representing 1.07% of the total number of Shares issued and outstanding), subject to an increase to 18,300,000 shares if the option plan resolution is approved by the shareholders at the annual general and
special meeting currently scheduled for January 13, 2016. As of August 31, 2015, 2,829,000 Options (representing 94.30% of the number of Options that are reserved for issuance under the Option Plan or 1.01% of the total number of Shares
issued and outstanding), including 600,000 tandem Options/RSUs, have been granted and are outstanding under the Option Plan. Therefore, there are currently 171,000 Options (representing 0.06% of the total number of Shares issued and outstanding)
available to be granted under the Option Plan. Upon approval of the Option Plan Resolution, there will be 15,471,000 Options (representing 5.50% of the total number of Shares issued and outstanding) available to be granted under the Option Plan,
which number does not include the 600,000 tandem Option/RSUs.

All Options will have a fixed exercise price, which shall not be less than
the fair market value at the date of grant, being the volume-weighted average closing price of the applicable Shares on the TSX for the five trading days in which the Shares have actually traded immediately preceding such date, or if the Shares are
not listed and posted for trading on any stock exchange, the fair market value of the Shares as determined by the Board in its sole discretion (Fair Market Value). At the election of a Participant, in lieu of exercising an Option
a Participant may instead choose to surrender such Option, in whole or in part, in consideration of (a) Shares, the number of which is determined by dividing: (i) the difference between the Fair Market Value of the Shares subject to the
Option on the date of exercise and the exercise price for such Option (the Option Value) by (ii) the Fair Market Value of the Shares subject to the Option on the date of exercise, or (b) cash, equal to the Option Value,
subject to the consent of Postmedia. The term of any Option shall expire on the tenth anniversary of the date of grant, unless otherwise specified by the Plan Administrator at the time of grant, subject to extension of up to ten business days in the
event the expiration of an Option would otherwise occur during or within two business days after the end of a Blackout Period (as defined in the Option Plan). Options (including the rights attached thereto) are non-assignable and non-transferable
except through devolution by death. The terms and conditions of Options granted under the Option Plan are subject to adjustments in certain circumstances, at the discretion of the Plan Administrator.

The Option Plan limits insider participation such that: (a) the number of Shares issuable pursuant to the exercise of Options granted to
insiders (as such term is used in the TSX Company Manual) of Postmedia under the Option Plan, together with the number of securities issuable to insiders under Postmedias other security-based compensation arrangements (as such term is used in
the TSX Company Manual), at any time, must not exceed 10% of Postmedias issued and outstanding Shares; and (b) the number of Shares issued to insiders of Postmedia within any one year period pursuant to the exercise of Options, together
with the number of securities issued to insiders pursuant to all of Postmedias other security-based compensation arrangements, shall not exceed 10% of Postmedias issued and outstanding Shares.



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##### Table of Contents

Under the Option Plan, in the case of the death of a Participant, all outstanding unvested
Options granted to such Participant shall immediately and automatically be deemed to be vested and the legal representatives of such Participant shall have the right to exercise part or all of the Participants outstanding and vested Options at
any time up to and including (but not after) the earlier of the last business day on or prior to: (i) the date that is one year following the date of death of such Participant; or (ii) the date on which the exercise period of the
particular Option expires. In the case of Incapacity (as defined in the Option Plan), all outstanding unvested Options granted to such Participant continue to vest and the Participant shall have the right to exercise part or all of the
Participants outstanding and vested Options at any time up to and including the date on which the particular Option expires. In the case of resignation or cessation of office or employment of the Participant with the prior written consent of
Postmedia, all outstanding and unvested Options granted to such Participant immediately and automatically terminate provided that, the Board may, but is not obligated to, allow a portion or all of the unvested Options to have an extended time period
by which such Options may remain in effect and shall not automatically terminate. Such Participant shall have the right to exercise part or all of the Participants outstanding and vested Options at any time up to and including (but not after)
the earlier of the last business day on or prior to: (i) the date on which the exercise period of the particular Option expires; or (ii) the date that is 90 days following the date of resignation. In the case of Retirement (as defined in
the Option Plan) of a Participant, all outstanding unvested Options granted to such Participant shall not terminate but shall continue to vest in accordance with their terms and the Participant shall have the right to exercise part or all of such
Options once vested at any time up to and including (but not after) the earlier of the last business day on or prior to: (i) the date that is three years following the date of Retirement; or (ii) the date on which the exercise period of
the particular Option expires, and the Participant shall have the right to exercise part or all of the Participants outstanding and vested Options as at the date of Retirement at any time up to and including (but not after) the earlier of the
last business day on or prior to: (x) the date that is three years following the date of Retirement; or (y) the date on which the exercise period of the particular Option expires. Where a Participants employment terminates by reason
of termination without Cause (as defined in the Option Plan), unless otherwise determined by the Plan Administrator, all outstanding and unvested Options granted to such Participant will immediately and automatically terminate provided that, the
Board may, but is not obligated to, allow a portion or all of the unvested Options to have an extended time period by which such Options may remain in effect and shall not automatically terminate. The Participant will have the right to exercise part
or all of the Participants outstanding and vested Options at any time up to and including (but not after) the earlier of the last business day on or prior to: (i) the date on which the exercise period of the particular Option expires; and
(ii) the date that is 90 days after the Termination Date (as defined in the Option Plan). Where a Participants employment is terminated by Postmedia or certain related entities for Cause, then any Options held by such Participant, whether
or not exercisable at the Termination Date, immediately expire and are cancelled on such date at a time determined by the Plan Administrator, in its sole discretion.

If, before the expiry of an Option in accordance with the terms thereof, a Change of Control (as defined in the Option Plan) occurs and a
Participant ceases to be an employee of Postmedia or certain related entities by reason of termination: (i) by Postmedia or related entity or by the entity that has entered into a valid and binding agreement with Postmedia and/or its affiliates
to effect the Change of Control at any time after such agreement is entered into or during the Control Period (as defined in the Option Plan) and such termination was for any reason other than for Cause; or (ii) by the Participant within 60
days after an act of Constructive Dismissal (as defined in the Option Plan), the Participants Options become fully vested and may be exercised or surrendered by the Participant at any time within 120 days of the Participants Termination
Date. In the event of a Change of Control, all outstanding Options shall be replaced with similar options of the entity resulting from the transaction on substantially the same terms and conditions as the Options, unless such replacement is not
possible, practical or advisable, as the Board may, in its sole discretion, determine. If such determination is made that replacement is not possible, practical or advisable, the Plan Administrator may, in its sole discretion, accelerate the vesting
of any or all outstanding Options to provide that such outstanding Options shall be fully vested and conditionally exercisable upon (or prior to) the completion of the transaction resulting in the Change of Control.



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##### Table of Contents

In the event the Plan Administrator accelerates the vesting of any outstanding Options provided
at least ten days notice has been provided to an Optionee (as defined in the Option Plan), all vested Options, unless exercised prior to or at the time of the Change of Control, will expire and be of no further force or effect upon completion
of the Change of Control. If, for any reason, the transaction that would result in a Change of Control is not completed, the Plan Administrator may cause the acceleration of exercise periods of any Options or acceleration of the time for the
fulfillment of any conditions or restrictions on such exercise of Options to be retracted and the vesting of such Options to revert to the manner provided in the applicable Option grant document, unless such Options have already been exercised.

The Board may amend the Option Plan without Shareholder approval in certain instances, including, without limitation: (i) for the purpose
of making formal, minor or technical modifications to any of the provisions of the Option Plan, including amendments of a housekeeping nature; (ii) to correct any ambiguity, defective provision, error or omission in the
provisions of the Option Plan; (iii) to amend the vesting provisions of Options; (iv) to change the termination provisions of Options or the Option Plan that does not entail an extension beyond the original expiry date; or (v) any
other amendment that does not require Shareholder approval under applicable laws or the applicable rules of the TSX, provided that no such amendment may be made without the consent of each affected Optionee if such amendment would adversely affect
the rights of such affected Optionee for Options previously granted. Shareholder approval will be required for any amendment to the Option Plan to: (a) reduce the exercise price; (b) extend the term of Options (other than as set out in the
Option Plan); (c) increase the maximum number of Shares which may be issued under the Option Plan, subject to certain exceptions in connection with a reorganization or other event affecting the capital of Postmedia; (d) remove or exceed
the insider participation limit; and (e) amend the amendment provisions of the Option Plan.

Restricted Share Unit Plan

The restricted share unit plan (the RSU Plan) provides for the grant of the right to acquire fully paid and non-assessable
Shares (RSUs), as applicable, in accordance with the terms of the RSU Plan to Participants, being current part-time or full-time officers, employees or consultants of Postmedia or certain related entities. The maximum aggregate
number of Shares issuable under the RSU Plan shall not exceed 600,000 Shares, subject to an increase to 4,600,000 Shares if the RSU Plan resolution is approved by the Shareholders at the annual general and special meeting currently scheduled for
January 13, 2016. Effective July 13, 2010, Postmedia granted 600,000 RSUs (representing 100% of the number of RSUs that are reserved for issuance, or 0.21% of the total number of Shares issued and outstanding. to Mr. Godfrey as part
of the tandem Options/RSUs (Tandem Award) described under Employment Agreements and, as a result, there are currently no RSUs available to be granted under the RSU Plan. Upon approval of the RSU Plan Resolution,
there will be 4,000,000 RSUs (representing 1.42% of the total number of Shares issued and outstanding) available to be granted under the RSU Plan.

The RSU Plan is administered by the Board. In administering the RSU Plan, the Board may determine, among other things, Participants to whom
RSUs are granted and the amounts, terms and vesting dates of RSUs. As a result of adjustments to the RSU Plan which were adopted by the Board in Fiscal 2015, RSUs which are subject to performance conditions, otherwise known as PSUs, may be granted
under the RSU Plan. Each RSU will be settled for one Share, without payment of additional consideration, after such RSU has vested; however, at any time, a Participant may request in writing, upon exercising vested RSUs, subject to the consent of
Postmedia, that Postmedia pay an amount in cash equal to the aggregate current Fair Market Value of the Shares on the date of such exercise in consideration for the surrender by the Participant to Postmedia of the rights to receive Shares under such
RSUs. The Board may in its sole discretion accelerate the vesting date for all or any RSUs for any Participant at any time and from time to time. RSUs are non-transferable. The terms and conditions of RSUs granted under the RSU Plan will be subject
to adjustments in certain circumstances, in the discretion of the Board.



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The RSU Plan limits insider participation such that: (i) the number of Shares issuable to
insiders (as such term is used in the TSX Company Manual) at any time, under all security based compensation arrangements (as such term is used in the TSX Company Manual) of Postmedia, shall not exceed 10% of the number of Shares issued and
outstanding from time to time; and (ii) the number of Shares issued to insiders, within any one year period, under all security based compensation arrangements of Postmedia, shall not exceed 10% of the number of Shares issued and outstanding
from time to time.

Under the RSU Plan, in the case of the death of a Participant, all outstanding unvested RSUs granted to such
Participant shall immediately and automatically be deemed to be vested and the legal representatives of such Participant shall have the right to exercise part or all of the Participants outstanding and vested RSUs at any time up to and
including (but not after) the last business day on or prior to the date that is one year following the date of death of such Participant. In the case of Incapacity (as defined in the RSU Plan), all outstanding unvested RSUs granted to such
Participant continue to vest and the Participant shall have the right to exercise part or all of the Participants outstanding and vested RSUs at any time. In the case of resignation or cessation of office or employment of the Participant with
the prior written consent of Postmedia, all outstanding and unvested RSUs granted to such Participant will immediately and automatically terminate provided that, the Board may, but is not obligated to, allow a portion or all of the unvested RSUs to
have an extended time period by which such RSUs may remain in effect and shall not automatically terminate. Such Participant shall have the right to exercise part or all of the Participants outstanding and vested RSUs at any time up to and
including (but not after) the last business day on or prior to the date that is 90 days following the date of resignation. In the case of Retirement (as defined in the RSU Plan) of a Participant, all outstanding unvested RSUs granted to such
Participant shall not terminate but shall continue to vest in accordance with their terms and the Participant shall have the right to exercise part or all of such RSUs once vested at any time up to and including (but not after) the last business day
on or prior to the date that is three years following the date of Retirement, and the Participant shall have the right to exercise part or all of the Participants outstanding and vested RSUs as at the date of Retirement at any time up to and
including (but not after) the last Business Day on or prior to the date that is three years following the date of Retirement. Where a Participants employment terminates by reason of termination without Cause (as defined in the RSU Plan),
unless otherwise determined by the Board, all outstanding and unvested RSUs granted to such Participant will immediately and automatically terminate provided that, the Board may, but is not obligated to, allow a portion or all of the unvested RSUs
to have an extended time period by which such RSUs may remain in effect and shall not automatically terminate. The Participant will have the right to exercise part or all of the Participants outstanding and vested RSUs at any time up to and
including (but not after) the date that is 90 days after the Termination Date (as defined in the RSU Plan). Where a Participants employment is terminated by Postmedia or certain related entities for Cause, then any RSUs held by such
Participant, whether or not exercisable at the Termination Date, immediately expire and are cancelled on such date at a time determined by the Plan Administrator, in its sole discretion.



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If, before the expiry of a RSU in accordance with the terms thereof, a Change of Control (as
defined in the RSU Plan) occurs and a Participant ceases to be an employee of Postmedia or certain related entities by reason of termination: (i) by Postmedia or a related entity or by the entity that has entered into a valid and binding
agreement with Postmedia and/or its affiliates to effect the Change of Control at any time after such agreement is entered into or during the Control Period (as defined in the RSU Plan) and such termination was for any reason other than for Cause;
or (ii) by the Participant within 60 days after an act of Constructive Dismissal (as defined in the RSU Plan), the Participants RSUs become fully vested and may be exercised or surrendered by the Participant at any time within 120 days of
the Participants Termination Date. In the event of a Change of Control, all outstanding RSUs shall be replaced with similar restricted share units of the entity resulting from the transaction on substantially the same terms and conditions as
the RSU Plan, unless such replacement is not possible, practical or advisable, as the Board may, in its sole discretion, determine. If such determination is made that replacement is not possible, practical or advisable, the Board may, in its sole
discretion, accelerate the vesting of any or all outstanding RSUs to provide that such outstanding RSUs shall be fully vested and conditionally exercisable upon (or prior to) the completion of the transaction resulting in the Change of Control. In
the event the Board accelerates the vesting of any outstanding RSUs (i) provided at least ten days notice has been provided to a Participant, all vested RSUs, unless exercised prior to or at the time of the Change of Control, will expire
and be of no further force or effect upon completion of the Change of Control, and (ii) if, for any reason, the transaction that would result in a Change of Control is not completed, the Board may cause the acceleration of exercise periods of
any RSUs or acceleration of the time for the fulfillment of any conditions or restrictions on such exercise of RSUs to be retracted and the vesting of such RSUs to revert to the manner provided in the applicable RSU agreement, unless such RSUs have
already been exercised.

The Board may amend the RSU Plan without Shareholder approval in certain instances, including, but not limited
to: (i) for the purpose of making formal, minor or technical modifications to any of the provisions of the Plan, including amendments of a housekeeping nature; (ii) to correct any ambiguity, defective provision, error or
omission in the provisions of the plan; (iii) to amend the vesting, redemption or payment provisions of the plan or any RSUs; (iv) to change the termination provisions of RSUs or the plan that does not entail an extension beyond the
original expiry date; (v) to facilitate a cash payment; or (vi) any other amendment that does not require Shareholder approval under applicable laws or the applicable rules of the TSX, provided that no such amendment of the plan may be
made without the consent of each affected Participant if such amendment would adversely affect the rights of such affected Participant for RSUs previously granted. Shareholder approval will be required for any amendment to the RSU Plan to:
(a) extend the term of RSUs; (b) increase the maximum number of Shares which may be issued under the plan, subject to certain exceptions in connection with a reorganization or other event affecting the capital of Postmedia; (c) remove
or exceed the insider participation limit; and (d) amend the amendment provisions of the plan.



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Outstanding Share-Based Awards and Option-Based Awards

The table below sets forth information related to Options held by the NEOs as at August 31, 2015:



|                 |         |                                                        |      |                         |                        |                                                   |                  |                   |   |                                               |   |                                        |   |                                                                    
|---------------- | ------- | ------------------------------------------------------ | ---- | ----------------------- | ---------------------- | ------------------------------------------------- | ---------------- | ----------------- | - | --------------------------------------------- | - | -------------------------------------- | - | -------------------------------------------------------------------
|                 |         | OPTION-BASED AWARDS                                    |      | SHARE-BASED AWARDS     
|NAME             |         | NUMBER OFSECURITIESUNDERLYINGUNEXERCISEDOPTIONS(1)
(#) |      | OPTIONEXERCISEPRICE ($) |                        | CLASS OF SHARES
UNDERLYING THE
OPTIONS GRANTED(2) |                  | OPTION EXPIRYDATE |   | VALUE OFUNEXERCISEDIN-THE-MONEYOPTIONS(3) ($) |   | NUMBER OFSHARES THATHAVE
NOTVESTED (#) |   | MARKET OR PAYOUTVALUE OF
SHARE-BASED AWARDSTHAT HAVE NOT VESTED ($)
|Paul Godfrey(4)  |         | 400,000                                                |      | 9.85                    |                        | Voting Shares                                     |                  | July 13, 2020     |   |                                              |   |                                       |   |                                                                   
|                 | 200,000 |                                                        | 2.02 |                         | Variable Voting Shares |                                                   | October 24, 2023 |                   |  |                                               |  |                                        | 
|                 | 150,000 |                                                        | 1.90 |                         | Variable Voting Shares |                                                   | October 24, 2024 |                   |  |                                               |  |                                        | 
|Douglas Lamb     |         | 200,000                                                |      | 9.85                    |                        | Voting Shares                                     |                  | July 13, 2020     |   |                                              |   |                                       |   |                                                                   
|                 | 65,000  |                                                        | 2.02 |                         | Variable Voting Shares |                                                   | October 24, 2023 |                   |  |                                               |  |                                        | 
|                 | 50,000  |                                                        | 1.90 |                         | Variable Voting Shares |                                                   | October 24, 2024 |                   |  |                                               |  |                                        | 
|Wayne Parrish(5) |         | 200,000                                                |      | 6.53                    |                        | Voting Shares                                     |                  | January 26, 2022  |   |                                              |   |                                       |   |                                                                   
|                 | 65,000  |                                                        | 2.02 |                         | Variable Voting Shares |                                                   | October 24, 2023 |                   |  |                                               |  |                                        | 
|                 | 50,000  |                                                        | 1.90 |                         | Variable Voting Shares |                                                   | October 24, 2024 |                   |  |                                               |  |                                        | 
|Andrew MacLeod   |         | 50,000                                                 |      | 1.90                    |                        | Variable Voting Shares                            |                  | October 24, 2024  |   |                                              |   |                                       |   |                                                                   
|Gordon Fisher    |         | 200,000                                                |      | 9.85                    |                        | Voting Shares                                     |                  | July 13, 2020     |   |                                              |   |                                        |   |                                                                   
|                 | 15,000  |                                                        | 2.02 |                         | Variable Voting Shares |                                                   | October 24, 2023 |                   |  |                                               |  |                                        | 
|                 | 15,000  |                                                        | 1.90 |                         | Variable Voting Shares |                                                   | October 24, 2024 |                   |  |                                               |  |                                        | 
|Jeffrey Haar     |         | 50,000                                                 |      | 5.68                    |                        | Variable Voting Shares                            |                  | January 26, 2022  |   |                                              |   |                                       |   |                                                                   
|                 | 40,000  |                                                        | 2.02 |                         | Variable Voting Shares |                                                   | October 24, 2023 |                   |  |                                               |  |                                        | 
|                 | 30,000  |                                                        | 1.90 |                         | Variable Voting Shares |                                                   | October 24, 2024 |                   |  |                                               |  |                                        | 



Notes:



|(1) | Includes both vested and unvested Options.
|--- | ------------------------------------------

|(2) | The class of Shares underlying the Options is determined at the discretion of the Board. Since October 2013, the class of Shares underlying the
Options has been Variable Voting Shares.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | This column contains the aggregate value of the in-the-money vested and unvested unexercised Options as of August 31, 2015, computed using the
weighted average share price for the five trading days in which Shares have actually traded immediately preceding August 31, 2015, of $0.42 for the Voting Shares and $0.61 for the Variable Voting Shares. The Options have not been and may never
be exercised and the actual gain, if any, on exercise will depend on the value of the Voting Shares or Variable Voting Shares on the date of such exercise.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Does not include Mr. Godfreys Tandem Award. For more information on the Tandem Award, see Employment Agreements.
|--- | -------------------------------------------------------------------------------------------------------------------

|(5) | Mr. Parrishs employment with the Corporation ended July 6, 2015 at which time 119,000 Options were forfeited in accordance with the
terms of the Option Plan. The remaining 196,000 Options were cancelled on October 4, 2015.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Value Vested or Earned During the Year

The following table summarizes the value of (a) option-based awards that would have been realized by each NEO during Fiscal 2015 if the
option-based awards that vested in Fiscal 2015 had been exercised on their vesting date and (b) share-based awards realized by each NEO upon vesting during Fiscal 2015:



|                 |  |                                                         |  |                                                      |  |                                                                       
|---------------- |  | ------------------------------------------------------- |  | ---------------------------------------------------- |  | ----------------------------------------------------------------------
|NAME             |  | OPTION-BASED AWARDS VALUE VESTED DURINGTHE YEAR(1)
($) |  | SHARE-BASED AWARDS VALUE VESTED DURING THE
YEAR ($) |  | NON-EQUITY INCENTIVEPLAN COMPENSATION VALUE EARNED DURING THEYEAR ($)
|Paul Godfrey     |  |                                                        |  |                                                     |  | 118,750                                                               
|Douglas Lamb     |  |                                                        |  |                                                     |  |                                                                      
|Wayne Parrish(2) |  |                                                        |  |                                                     |  |                                                                      
|Andrew MacLeod   |  |                                                        |  |                                                     |  |                                                                      
|Gordon Fisher    |  |                                                        |  |                                                     |  |                                                                      
|Jeffrey Haar     |  |                                                        |  |                                                     |  |                                                                      



Notes:



|(1) | For Messrs. Godfrey, Lamb and Fisher the value of the Options granted which vested in Fiscal 2015 were computed using the weighted average share
price for the five trading days in which Shares have actually traded immediately preceding the vesting dates of January 28, 2015 of $1.90 and February 24, 2015 of $1.39 for the Variable Voting Shares. For Messrs. Parrish and Haar the value
of the Options granted which vested in Fiscal 2015 were computed using the weighted average share price for the five trading days in which Shares have actually traded immediately preceding the vesting date of January 26, 2015 of $2.15 for the
Voting Shares and the vesting dates of January 28, 2015 of $1.90 and February 24, 2015 of $1.39 for the Variable Voting Shares. For Mr. MacLeod the value of the Options granted which vested in Fiscal 2015 were computed using the
weighted average share price for the five trading days in which Shares have actually traded immediately preceding the vesting date of January 28, 2015 of $1.90 for the Variable Voting Shares. None of the Options issued to the NEOs were
in-the-money on the vesting dates during Fiscal 2015 as the exercise price was in excess of the value of a Voting Share and Variable Voting Share. The Options have not been and may never be exercised and actual gain, if any, on exercise will depend
on the value of the Voting Shares and Variable Voting Shares on the date of such exercise.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Mr. Parrishs employment with the Corporation ended July 6, 2015 at which time 119,000 Options were forfeited in accordance with the
terms of the Option Plan. The remaining 196,000 Options were cancelled on October 4, 2015.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Employee Share Purchase Plan

The Employee Share Purchase Plan (ESPP) was adopted in 2011 and has not yet been made available to employees.
If implemented, all union and non-union permanent full time and permanent part-time employees of the Corporation, Postmedia Network Inc. or any affiliated company approved by the Board would be permitted to participate in the ESPP, subject to
certain exclusions (including those employees who have been granted Options and those employees who are resident in the United States).

Under the terms of the ESPP, eligible employees of the Corporation who elect to participate shall contribute at least 1% of their annual base
salary (excluding bonus, commission and overtime pay), up to a maximum on an annual basis equal to the lesser of (i) 5% of the employees annual base salary (excluding bonus, commission and overtime pay) or (ii) $8,000. The
Corporation will match all contributions made by the employee by either contributing cash to be used by the administrative agent of the ESPP to purchase Shares on behalf of the employee or issuing Shares from treasury, in each case having a value
equal to 25% of an employees contribution up to an annual maximum of $2,000 per employee. The Shares issued by, or purchased with contributions from, the Corporation will be issued to the employee within, or be subject to a vesting period of,
12 to 18 months following the employee contribution, respectively. The Corporation may also make additional contributions for any employee or group of employees at the Boards discretion.



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Both employee and employer contributions are used to acquire Shares on behalf of the employee
through either issuances from treasury, open market purchases or a combination of both. Market purchases under the ESPP are made at the market price on the TSX. If employee contributions are used to purchase Shares from treasury, Shares are issued
at the average 30-day closing price on the TSX and the corresponding employer Shares are issued at the same price. If employee Shares are acquired through open market purchases, corresponding employer Shares are issued at the same price.

Employees may withdraw their Shares that are subject to the ESPP, subject to certain employer contribution vesting provisions. An
employees participation in the ESPP terminates if he or she becomes disabled, retires, dies, or is no longer eligible for the ESPP or the ESPP is terminated. On such terminations, all Shares (both vested and unvested) of the employee subject
to the ESPP may be transferred as directed by the employee or sold. An employees participation in the ESPP also terminates if he or she is placed on layoff and all recall rights have been exhausted, or his or her employment is terminated. On
such terminations, or if the employee terminates his or her participation in the ESPP, only those vested Shares of the employee subject to the ESPP may be transferred as directed by the employee or sold (and the employee will not be entitled to
receive the unvested Shares). The right to participate in the ESPP may not be assigned or transferred.

The maximum number of Shares that
may be issued from treasury under the ESPP is 800,000 Shares. As of the date hereof, no Shares have been issued in respect of the ESPP.

The maximum number of Shares that may be issued from treasury to insiders (as defined in the Securities Act (Ontario)) within any one
year period and issuable at any time under the ESPP and all other security based compensation arrangements is 10% of the total number of outstanding Shares on a fully diluted basis.

The Board reserves the right at any time, subject to any regulatory or stock exchange approval that may be required, to amend the ESPP without
prior notice to or approval by Shareholders provided, however, that no amendment or modification shall adversely affect the rights and interests of a participants Shares allocated to his or her account under the ESPP prior to the date of such
amendment. Examples of circumstances where the Board may make amendments without Shareholder approval include, without limitation, amendments that would: (a) make housekeeping or clerical changes; (b) clarify any provision in the ESPP;
(c) ensure compliance with applicable laws, regulations or policies of any governmental authority or relevant stock exchange; (d) change the class of participants eligible to participate in the ESPP; and (e) change the terms and
conditions of any financial assistance which may be provided by the Corporation to the participants to facilitate the purchase of Shares under the ESPP, or adding or removing any provisions providing for such financial assistance. No amendment to
the ESPP requiring the approval of the Shareholders of the Corporation under any applicable securities laws or requirements (including without limitation the TSX rules and policies) shall become effective until such approval is obtained. In addition
to the foregoing, the approval of the holders of a majority of the Shares present and voting in person or by proxy at a meeting of Shareholders shall be required for: (a) any amendment to the provisions of the amendment provision of the ESPP;
(b) a reduction in the price at which Shares are issued under the ESPP that benefits an insider of the Corporation; (c) any amendment to remove or to exceed the insider participation limit; and (d) any increase in the maximum number
of Shares issuable under the ESPP.



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Employment Agreements

The following table summarizes key details of the employment agreement for the CEO:



|                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NAME                                              |  | Paul Godfrey                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                  | 
|EFFECTIVE DATE                                    |  | On July 13, 2010, Mr. Godfrey entered into an employment agreement with Postmedia Network Inc. with an expiry date of August 31, 2014, the
term of which agreement was extended as of June 7, 2013 to December 31, 2016 and was further extended as of May 15, 2015 to December 31, 2018.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                  | 
|ANNUAL BASE SALARY ($)                            |  | 950,000                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                  | 
|INCENTIVE COMPENSATION (ANNUAL CASH BONUS)        |  | The employment agreement for Mr. Godfrey provides him with an annual cash incentive target opportunity of 100% of his base salary, based on
full achievement of the targets (as discussed in Executive Compensation  Annual Short-Term Incentive Plan) as fixed by the Board of Directors, with enhanced eligibility for up to an additional 50% of Mr. Godfreys base
salary, based on exceeding the financial target fixed by the Board of Directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                  | 
|EMPLOYEE BENEFITS AND PERQUISITES                 |  | Mr. Godfrey is entitled to receive various employee benefits and perquisites.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                  | 
|EQUITY OWNERSHIP AND SHARE-BASED AWARDS           |  | Pursuant to the terms of the employment agreement, Mr. Godfrey subscribed for $1,000,000 of Voting Shares at a price of $9.26 per share
(which Shares are currently held in a trust for the benefit of certain members of Mr. Godfreys family). In addition, Mr. Godfrey received Options to acquire 400,000 Voting Shares exercisable at a price of $9.85 per share and a grant of an
additional 600,000 tandem Options/RSUs. These tandem Options/RSUs were granted concurrently and, upon the exercise of any or all of such Options, the corresponding number of RSUs will be automatically forfeited by Mr. Godfrey for no consideration
and, upon the exercise of any or all of such RSUs, the corresponding number of Options will be automatically forfeited by Mr. Godfrey for no consideration. Upon the exercise of an Option, Mr. Godfrey will, upon payment of the exercise price, receive
one Share in accordance with the terms of the Option Plan. Upon exercise of an RSU, Mr. Godfrey will receive one Share without payment of additional consideration, however Mr. Godfrey may request in writing upon exercising his vested RSUs, subject
to the consent of Postmedia, to receive the Fair Market Value of the Shares in cash in accordance with the terms of the RSU Plan. In no event will Mr. Godfrey receive more than 600,000 share entitlements (either in the form of Shares or the value of
a Share, as applicable) in respect of the Tandem Award. The Options and RSUs will vest, as to 20% of the Shares subject to each award immediately upon grant and, as to the balance of the Shares subject to each award, equally on each of the first
four anniversaries of the effective date of the employment agreement.
|                                                  | 
|PENSION                                           |  | Mr. Godfrey is not eligible for any pension and/or post-retirement income from Postmedia Network Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                  | 
|TERMINATION OF EMPLOYMENT WITHOUT CAUSE           |  | The employment agreement provides that if Mr. Godfreys position is terminated without cause by Postmedia Network Inc. or by Mr. Godfrey
for good reason, Mr. Godfrey will be paid an amount equal to the base salary that would have been payable to him until the expiry of the term of his employment agreement as if it had not been terminated. Mr. Godfreys
termination clause also provides for an amount equal to the average of annual cash incentive bonuses paid to Mr. Godfrey for each fiscal year during which Mr. Godfrey was employed with Postmedia Network Inc. prorated for any partial year to the
expiry of the term, together with continuation of benefits, perquisites and allowances to which Mr. Godfrey was entitled at the date of termination for the same period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                  | 
|TERMINATION OF EMPLOYMENT BY REASON OF INCAPACITY |  | In the event of a termination of Mr. Godfreys employment by reason of incapacity, Mr. Godfrey is entitled to the base salary, benefits
and perquisites and allowances to which he was entitled at the date of termination to the end of the term.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                  | 
|NON-COMPETE OR NON-SOLICITATION                   |  | Mr. Godfreys employment agreement also includes non-competition and non-solicitation covenants effective during the term of employment
and post-termination (until the later of 12 months following termination and the entirety of the term of the agreement) in favour of Postmedia Network Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                  | 
|OTHER TERMS                                       |  | The agreement provides that Mr. Godfreys position is intended to be full-time and exclusive, subject only to the reasonable fulfillment
of his responsibilities in connection with his other positions as approved by Postmedia Network Inc. from time to time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      



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The following table summarizes key details of the employment agreements for each of the NEOs:



|                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                         |  |                                                                                                                                                                                                                                             |  |                                                                                                                                                     |  |                                                                                                                                                                                                                                            
|-------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|NAME OF NEO                                              |  | DOUGLAS LAMB                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | WAYNE PARRISH                                                                                                           |  | ANDREW MACLEOD                                                                                                                                                                                                                              |  | GORDON FISHER                                                                                                                                       |  | JEFFREY HAAR                                                                                                                                                                                                                               
|                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                         | 
|EFFECTIVE DATE OF EMPLOYMENT WITH POSTMEDIA NETWORK INC. |  | July 13,2010                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | July 20, 2010 (1)                                                                                                       |  | July 7, 2014                                                                                                                                                                                                                                |  | July 13, 2010                                                                                                                                       |  | January 12, 2012                                                                                                                                                                                                                           
|                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                         | 
|ANNUAL BASE SALARY ($)                                   |  | 450,000                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | 475,000                                                                                                                 |  | 425,000                                                                                                                                                                                                                                     |  | 400,000                                                                                                                                             |  | 300,000                                                                                                                                                                                                                                    
|                                                         | 
|INCENTIVE COMPENSATION (ANNUAL CASH BONUS)               |  | The employment agreements for the NEOs provide them with an annual cash incentive target opportunity of 50% of base salary, based
on full achievement of the targets (as discussed in Executive Compensation  Annual Short-Term Incentive Plan) as fixed by the Board of Directors, with enhanced eligibility for up to an additional 50% of the NEOs base salary,
based on exceeding the financial target fixed by the Board of Directors.
|                                                         | 
|EMPLOYEE BENEFITS AND PERQUISITES                        |  | The NEOs are entitled to receive various employee benefits and perquisites.                                                                                                                                                                                                                                                                                                                                                                   
|                                                         | 
|EQUITY OWNERSHIP AND SHARE-BASED AWARDS                  |  | Messrs. Lamb and Parrish exercised rights to subscribe for $200,000 of Shares and Mr. Fisher exercised his right to subscribe for
$500,000 of Shares, each at a price of $9.26 per share. For more information about share-based awards, see Executive Compensation  Summary Compensation Table                                                                                                                                            
|                                                         | 
|PENSION                                                  |  | The NEOs participate in, or are in receipt of payments from, the Corporations Pension Plans. For more information about the
NEOs participation in the Corporations Pension Plans, see Executive Compensation  Pension Plans                                                                                                                                                                                                              
|                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                         | 
|TERMINATION OF EMPLOYMENT WITHOUT CAUSE                  |  | The NEO will be paid a lump sum severance payment equivalent to two
times base salary, average annual bonus(2) and car allowance. The minimum payment under the agreement is $1,378,800. 
The NEO will also be granted these benefits in the event of: (a) termination due to change of control; or (b) resignation by the NEO due to change of
control.                                                                                       |  | The NEO was paid alump sum severancepayment equivalentto two times basesalary, averageannual bonus(2) andcar allowance. |  | For each full year of service completed, the NEO will be paid a lump sum severance payment equivalent to: (a) one months base salary; and (b) one
months average annual bonus(2) for a minimum of 12 months up to a maximum of 24 months. |  | The NEO will be paid a lump sum severance payment equivalent to a maximum of 24 months salary and a maximum of 24 months average annual bonus(2). |  | For each full year of service completed, the NEO will be paid a lump sum severance payment equivalent to: (a) one months base salary;
and (b) one months average annual bonus(2) for a minimum of 18 months up to a maximum of 24 months.
|                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                         | 
|CONTINUATION OF BENEFITS                                 |  | The NEO will continue to receive benefits for a period of 18 months.                                                                                                                                                                                                                                                                                                                                                                           |  | The NEO receivedbenefits for a periodof up to 24 months.                                                                |  | The NEO will continue to receive benefits for a minimum period of 12 months up to a maximum of 24 months.                                                                                                                                   |  | Not Applicable                                                                                                                                      |  | Mr. Haar will continue to receive benefits for a period of 18 months.                                                                                                                                                                      
|                                                         | 
|TERMINATION OF EMPLOYMENT BY REASON OF INCAPACITY        |  | None of the NEOs are entitled to receive benefits in the event of termination of employment by reason of incapacity.                                                                                                                                                                                                                                                                                                                          
|                                                         | 
|NON-COMPETE OR NON-SOLICIATION                           |  | The employment agreements for the NEOs include non-competition and non-solicitation clauses in favour of Postmedia Network Inc.
The non-competition clause is in effect for a period of six months following termination and the non-solicitation clause is in effect for a period of 12 months following termination.(3)                                                                                                                     



Notes:



|(1) | Mr. Parrish entered into a consulting agreement with Postmedia Network Inc. on July 20, 2010 and subsequently became an employee. His
employment with the Corporation ended July 6, 2015.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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|(2) | The average annual bonus will be calculated based on what was paid, or payable, for the last two fiscal years.
|--- | --------------------------------------------------------------------------------------------------------------

|(3) | Mr. MacLeods non-competition and non-solicitation clauses are in effect for 12 months following the date of the termination.
|--- | -----------------------------------------------------------------------------------------------------------------------------

Termination and Change of Control Benefits

The following table summarizes the estimated incremental payments to each NEO in the event of termination without cause and termination due to
incapacity. The payments are calculated as at August 31, 2015. For more information, see Executive Compensation  Employment Agreements:



|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 
|----------------- | ------------------------ | ---------------------- |  | ------------------------------------------------------------- | --------- |  | -------------------------------------------------- | ------- | --------- | 
|NAME              |                          | COMPENSATION COMPONENT |  | ESTIMATED INCREMENTALPAYMENTS FORTERMINATION WITHOUTCAUSE ($) |           |  | ESTIMATED INCREMENTALPAYMENTS DUE TOINCAPACITY ($) |        
|Paul Godfrey(1)   |                          | Base Salary            |  |                                                               | 3,166,667 |  |                                                    |         | 3,166,667 | 
|                  | STIP                     |                        |  | 803,068                                                       |           |  |                                                    |        |          
|                  | Unvested Options         |                        |  |                                                              |           |  |                                                    |        |          
|                  | Continuation of Benefits |                        |  | 722,427                                                       |           |  |                                                    | 722,427 |          
|                  |                          |                        |  |                                                               |           |  |                                                    |         |          
|                  |                          | Total                  |  |                                                               | 4,692,162 |  |                                                    |         | 3,889,094 | 
|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 
|Douglas Lamb(2)   |                          | Base Salary            |  |                                                               | 1,378,800 |  |                                                    |         |          | 
|                  | Unvested Options         |                        |  |                                                              |           |  |                                                    |        |          
|                  | Continuation of Benefits |                        |  | 12,035                                                        |           |  |                                                    |        |          
|                  |                          |                        |  |                                                               |           |  |                                                    |         |          
|                  |                          | Total                  |  |                                                               | 1,390,835 |  |                                                    |         |          | 
|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 
|Wayne Parrish(3)  |                          | Base Salary            |  |                                                               | 950,000   |  |                                                    |         |          | 
|                  | Car Allowance            |                        |  | 28,800                                                        |           |  |                                                    |        |          
|                  | STIP                     |                        |  | 65,906                                                        |           |  |                                                    |        |          
|                  | Unvested Options         |                        |  |                                                              |           |  |                                                    |        |          
|                  | Continuation of Benefits |                        |  | 16,046                                                        |           |  |                                                    |        |          
|                  |                          |                        |  |                                                               |           |  |                                                    |         |          
|                  |                          | Total                  |  |                                                               | 1,060,752 |  |                                                    |         |          | 
|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 
|Andrew MacLeod(4) |                          | Base Salary            |  |                                                               | 425,000   |  |                                                    |         |          | 
|                  | STIP                     |                        |  | 53,125                                                        |           |  |                                                    |        |          
|                  | Unvested Options         |                        |  |                                                              |           |  |                                                    |        |          
|                  | Continuation of Benefits |                        |  | 5,802                                                         |           |  |                                                    |        |          
|                  |                          |                        |  |                                                               |           |  |                                                    |         |          
|                  |                          | Total                  |  |                                                               | 483,927   |  |                                                    |         |          | 
|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 
|Gordon Fisher(4)  |                          | Base Salary            |  |                                                               | 800,000   |  |                                                    |         |          | 
|                  | STIP                     |                        |  |                                                              |           |  |                                                    |        |          
|                  | Unvested Options         |                        |  |                                                              |           |  |                                                    |        |          
|                  |                          |                        |  |                                                               |           |  |                                                    |         |          
|                  |                          | Total                  |  |                                                               | 800,000   |  |                                                    |         |          | 
|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 
|Jeffrey Haar(4)   |                          | Base Salary            |  |                                                               | 450,000   |  |                                                    |         |          | 
|                  | STIP                     |                        |  |                                                              |           |  |                                                    |        |          
|                  | Unvested Options         |                        |  |                                                              |           |  |                                                    |        |          
|                  | Continuation of Benefits |                        |  | 12,035                                                        |           |  |                                                    |        |          
|                  |                          |                        |  |                                                               |           |  |                                                    |         |          
|                  |                          | Total                  |  |                                                               | 462,035   |  |                                                    |         |          | 
|                  |                          |                        |  |                                                               |           |  |                                                    |         |           | 



Notes:



|(1) | In the event of the resignation by Mr. Godfrey of his employment due to good reason (as defined in his employment
contract), Mr. Godfrey will be entitled to the same payments as he would be entitled to receive in respect of a termination without cause as described in the table above. Mr. Godfrey will not be entitled to any additional Options or RSUs
after his termination date, but all existing Options and his Tandem Award will continue to vest in accordance with the provisions of the relevant plan. If Mr. Godfreys employment contract is terminated due to incapacity, his unvested
Options under the Option Plan will continue to vest. The value of these unvested Options was calculated using a value of a Variable Voting Share of $0.61.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | In the event of the resignation by Mr. Lamb of his employment due to a change in control (as defined in his employment contract),
Mr. Lamb will be entitled to the same payments as he would be entitled to receive in respect of a termination without cause as described in the table above. If Mr. Lambs employment contract is terminated due to incapacity, his
unvested Options under the Option Plan will continue to vest. The value of these unvested Options was calculated using a value of a Variable Voting Share of $0.61.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Mr. Parrishs employment with the Corporation ended July 6, 2015 and as a result these amounts represent actual payments excluding
Mr. Parrishs continuation of benefits which will end on July 6, 2017.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | If any of Messrs. MacLeods, Fishers or Haars employment contracts are terminated due to incapacity, their respective unvested
Options under the Option Plan will continue to vest. The value of these unvested Options was calculated using a value of a Variable Voting Share of $0.61.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Except for those payments to Mr. Godfrey described in note 1 to the table above, no
incremental payments to the NEOs are triggered upon the event of resignation for good reason.

Except for those
payments to Mr. Lamb described in note 2 to the table above and the ability of the Board, at its discretion, to accelerate the vesting of unvested Options and unvested RSUs, no incremental payments to the NEOs are triggered upon a change in
control of the Corporation.

Director Compensation

Annual Fees

The compensation of
any director of Postmedia (other than any members of management who receive no compensation for serving on the Board) has been structured so that a minimum of one-half of such compensation is equity-based. Annual fees for directors are paid 50% (or
at the election of a particular director, a greater percentage) in the form of a grant of DSUs (as defined below) and the balance in cash.

The following table sets out the annual fees payable to Directors of the Corporation for Fiscal 2015:



|                                                                |  |                          |         | 
|--------------------------------------------------------------- |  | ------------------------ | ------- | 
|BOARD OR COMMITTEE                                              |  | ANNUAL CASH RETAINER ($) |        
|Board of Directors (Chair)                                      |  |                          | 270,000 | 
|Board of Directors (Member)                                     |  |                          | 120,000 | 
|Audit Committee (Chair)                                         |  |                          | 170,000 | 
|Compensation and Pension Committee (Chair)                      |  |                          | 170,000 | 
|Corporate Governance & Nominating Committee (Chair)             |  |                          | 150,000 | 
|Digital Oversight Committee (Chair)                             |  |                          | 150,000 | 
|Committee Membership (per committee, excluding chair positions) |  |                          | 10,000  | 

Directors do not receive a fee for each meeting attended unless it is determined by the Board that an
extraordinary number of meetings are being held.

Ms. Burke and Messrs. Savage, Shapiro, Sharpe and Steacy who were appointed
prior to, or within 90 days following, July 13, 2010, and Mr. Dow (the Initial Directors), each received one years additional remuneration in the form of DSUs, which vested in three equal installments over three
years, in advance of each such year, and were subject to a performance threshold based on Postmedia achieving an EBITDA (as that term is defined in the applicable Board resolution) of $220.0 million in any one fiscal year. On January 11, 2012,
the threshold was adjusted to $201.8 million to reflect the impact of the divestiture of the Victoria Times Colonist, Lower Mainland Publishing Group and Vancouver Island Newspaper Group on Postmedias consolidated operating income before
amortization, depreciation, impairment and restructuring. On November 18, 2015, the threshold was further adjusted to $254.8 million to reflect the impact of the Sun Acquisition on Postmedias consolidated operating income before
amortization, depreciation, impairment and restructuring. The performance threshold has not been met as of August 31, 2015.



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DSUs totaling 1,373,650 are outstanding and fully vested as at August 31, 2015 under the DSU
Plan (as defined herein), with the Value of a Share (as defined in the DSU Plan) used to determine the number of DSUs granted. Value of a Share means the five-day weighted average closing price of the Voting Shares or Variable
Voting Shares, as applicable for the five trading days in which the applicable Shares have actually traded, or, if the applicable Shares are not trading on the TSX, on the relevant day, the Value of a Share on such stock exchange on which such
Shares are listed and posted for trading as may be selected for such purpose by the Board; however, in the event that the applicable Shares are not listed and posted for trading on any stock exchange, the value of a Share shall be the Fair Market
Value thereof. During Fiscal 2015, the Corporation paid $743,000 in cash payments to its directors and issued 980,474 DSUs (including 198,842 DSUs related to the six months ended August 31, 2014, which could not be issued during Fiscal 2014 due
to a special blackout period), but which were subsequently issued in Fiscal 2015 upon lift of such special blackout period in accordance with the DSU plan as compensation (as described in the Director Compensation Table below) to
its directors.

Director Compensation Table

The following table describes the compensation that was paid by the Corporation to its non-executive directors during the year ended
August 31, 2015. Mr. Godfrey does not receive any compensation for serving as a director of the Corporation. His compensation for serving as CEO is included under the Summary Compensation Table. The total compensation
received by the Corporations non-employee directors in Fiscal 2015 was $1.5 million:



|                  |  |                |  |                         |  |                          |  |          
|----------------- |  | -------------- |  | ----------------------- |  | ------------------------ |  | ---------
|NAME              |  | FEES EARNED($) |  | FEES GRANTEDIN DSUs ($) |  | ALL OTHERCOMPENSATION($) |  | TOTAL($) 
|Rod Phillips      |  | 135,000        |  | 135,000                 |  |                         |  | 270,000  
|Charlotte Burke   |  | 63,000         |  | 77,000                  |  |                         |  | 140,000  
|Hugh F. Dow       |  | 70,000         |  | 70,000                  |  |                         |  | 140,000  
|Martin Nisenholtz |  | 80,000         |  | 80,000                  |  |                         |  | 160,000  
|Jane Peverett     |  | 70,000         |  | 70,000                  |  |                         |  | 140,000  
|Graham Savage     |  | 90,000         |  | 90,000                  |  |                         |  | 180,000  
|Steven Shapiro    |  | 65,000         |  | 65,000                  |  |                         |  | 130,000  
|Peter Sharpe      |  | 80,000         |  | 80,000                  |  |                         |  | 160,000  
|Robert Steacy     |  | 90,000         |  | 90,000                  |  |                         |  | 180,000  
|                  |  |                |  |                         |  |                          |  |          
|Total             |  | 743,000        |  | 757,000                 |  |                         |  | 1,500,000
|                  |  |                |  |                         |  |                          |  |          

Deferred Share Unit Plan

Postmedia has adopted the deferred share unit plan (the DSU Plan) for the benefit of its non-employee directors. Under the
DSU Plan, except as otherwise specified by the Board, non-employee directors of Postmedia are required to elect to receive a minimum of 50%, and may elect to receive up to 100%, of their annual fees satisfied in the form of deferred share units
(DSUs), and may receive additional grants of DSUs under the DSU Plan from time to time in accordance with the terms of the DSU Plan. The number of DSUs to be credited to a director will be calculated on the date that fees are
payable to such director, by dividing the dollar amount elected by such director in respect of such fees by the Value of a Share (as defined in the DSU Plan) on such date. The vesting conditions (which may include time restrictions, performance
conditions or a combination of both) of each DSU granted under the DSU Plan, will be determined by the Board, and on redemption (which would occur after the holder of the DSUs ceases to serve as a director and is not otherwise employed by Postmedia)
DSUs will be paid out in cash. The DSUs are generally non-transferrable. Whenever cash dividends or distributions are paid on the Shares, additional DSUs will be credited to directors. The Board may discontinue the DSU Plan at any time or, subject
to certain exceptions set out in the DSU Plan, may amend the DSU Plan at any time.



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The table below sets forth information related to DSUs held by Postmedias directors as at
August 31, 2015, based on the year of grant:



|                                        |  |                         |  |                                                     |  |                                         |  |                                                            |  |                                                     
|--------------------------------------- |  | ----------------------- |  | --------------------------------------------------- |  | --------------------------------------- |  | ---------------------------------------------------------- |  | ----------------------------------------------------
|DIRECTOR                                |  | VESTING CONDITIONS(1)   |  | NUMBER OFDSUSGRANTED ANDVESTEDDURING THEYEAR(2) (#) |  | VALUE OFDSUSVESTEDDURING THEYEAR(3) ($) |  | NUMBER OFDSUS GRANTEDAND VESTEDAS OF THE ENDOF THE YEAR(#) |  | VALUE OFDSUS VESTED
AS OF THE END
OF THE YEAR(3)
($)
|Rod Phillips                            |  | No criteria
Performance |  | 174,920                                            |  | 106,701                                |  | 179,353                                                   |  | 109,405                                            
|Charlotte Burke                         |  | No criteria
Performance |  | 99,400                                             |  | 60,634                                 |  | 139,38714,213                                              |  | 80,9755,969                                         
|Hugh F. Dow                             |  | No criteria
Performance |  | 90,699                                              |  | 55,326                                 |  | 129,30314,213                                              |  | 74.8245,969                                         
|Martin Nisenholtz                       |  | No criteria
Performance |  | 103,656                                            |  | 63,230                                 |  | 106,283                                                   |  | 64,833                                             
|Jane Peverett                           |  | No criteria
Performance |  | 90,699                                             |  | 55,326                                 |  | 107,983                                                   |  | 65,870                                             
|Graham Savage                           |  | No criteria
Performance |  | 116,612                                            |  | 71,133                                 |  | 166,24618,274                                              |  | 96,2027,675                                         
|Steven Shapiro                          |  | No criteria
Performance |  | 84,220                                             |  | 51,374                                 |  | 127,50413,198                                              |  | 72,6035,543                                         
|Peter Sharpe                            |  | No criteria
Performance |  | 103,656                                            |  | 63,230                                 |  | 156,92916,244                                              |  | 89,3586,822                                         
|Robert Steacy                           |  | No criteria
Performance |  | 116,612                                            |  | 71,133                                 |  | 166,24618,274                                              |  | 96,2027,675                                         
|                                        |  |                         |  |                                                     |  |                                         |  |                                                            |  |                                                     
|Total  No criteria                     |  |                         |  | 980,474                                             |  | 598,087                                 |  | 1,279,234                                                  |  | 750,272                                             
|                                        |  |                         |  |                                                     |  |                                         |  |                                                            |  |                                                     
|Total  Subject to Performance Criteria |  |                         |  |                                                    |  |                                        |  | 94,416                                                     |  | 39,653                                              
|                                        |  |                         |  |                                                     |  |                                         |  |                                                            |  |                                                     
|Total Outstanding                       |  |                         |  | 980,474                                             |  | 598,087                                 |  | 1,373,650                                                  |  | 789,925                                             
|                                        |  |                         |  |                                                     |  |                                         |  |                                                            |  |                                                     



Notes:



|(1) | Certain of the DSUs noted in this column as Performance, are subject to performance criteria requiring Postmedia to achieve a
specified EBITDA threshold as defined in Director Compensation  Annual Fees. As noted earlier, the performance threshold has not been met as of August 31, 2015.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | In Fiscal 2015, 980,474 DSUs were issued which represent 781,632 DSUs ($757,000 of fees) earned in Fiscal 2015 and 198,842 DSUs ($377,800 of fees)
earned in the six months ended August 31, 2014. The DSUs related to Fiscal 2014 were issued in Fiscal 2015 due to a special Blackout Period which prevented their issuance in Fiscal 2014. The special Blackout Period lifted in Fiscal 2015 and the
aforementioned DSUs were issued in accordance with the DSU Plan.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | The value of the DSUs vested during the year and as of the end of the year, are computed using the weighted average for the five trading days in
which Shares have actually traded immediately preceding August 31, 2015 of $0.42 for the Voting Shares and $0.61 for the Variable Voting Shares.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Securities Authorized for Issuance under Equity Compensation Plans

The Option Plan, RSU Plan and ESPP Plan were not approved by Shareholders as they were each adopted by the Corporation prior to being listed on
the TSX. The following table provides a summary of securities issued and issuable under all equity compensation plans of Postmedia as at August 31, 2015:



|                         |  |                                                                    |  |                                                         |  |                                                                                         
|------------------------ |  | ------------------------------------------------------------------ |  | ------------------------------------------------------- |  | ----------------------------------------------------------------------------------------
|EQUITY COMPENSATION PLAN |  | NUMBER OF SHARESTO BE ISSUED UPONEXERCISE OFOUTSTANDINGOPTIONS (#) |  | WEIGHTED AVERAGEEXERCISE PRICE OFOUTSTANDINGOPTIONS ($) |  | NUMBER OF SHARESREMAINING AVAILABLE FORFUTURE ISSUANCE UNDEREQUITY COMPENSATIONPLANS (#)
|Option Plan (1)          |  | 2,829,000(1)                                                       |  | 5.44                                                    |  | 171,000(2)                                                                              
|RSU Plan (1)             |  | 600,000(1)                                                         |  |                                                        |  |                                                                                        
|ESPP Plan (1)            |  |                                                                   |  |                                                        |  | 800,000(3)                                                                              



Notes:



|(1) | These amounts include 600,000 of tandem Options/RSUs issued to Mr. Godfrey. In the event that he exercises the Options, the corresponding
number of RSUs will be automatically forfeited for no consideration. In the event that he exercises the RSUs, the corresponding number of Options will be automatically forfeited for no consideration.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | This amount is based on there being a maximum of 3,000,000 Shares authorized for issuance under the Option Plan.
|--- | ----------------------------------------------------------------------------------------------------------------

|(3) | The maximum number of Shares that may be issued from treasury under the ESPP is 800,000 Shares. As of the date hereof, no Shares have been issued
in respect of the ESPP.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|C. | Board Practices.
|-- | ----------------

Postmedia is required to have a minimum of three directors and a maximum of 15 directors. In Fiscal 2015, the Board was composed of ten
directors, which number will be increased to eleven in the event that all nominees are elected at the annual general and special meeting currently scheduled for January 13, 2016.

The Board has adopted a majority voting policy in director elections that will apply at any meeting of Shareholders where an uncontested
election of directors is held. Pursuant to this policy, if the number of proxy votes withheld for a particular director nominee is greater than the votes for such director, the director nominee will be required to submit his or her resignation to
the Chair of the Board promptly following the applicable Shareholders meeting. Following receipt of resignation, the Corporate Governance and Nominating Committee will consider whether or not to accept the offer of resignation and make a
recommendation to the Board. Within 90 days following the applicable Shareholders meeting, the Board shall publicly disclose their decision whether to accept the applicable directors resignation or not, including the reasons for
rejecting the resignation, if applicable, provided that the Board shall accept the resignation absent exceptional circumstances. The resignation will be effective when accepted by the Board. The Corporation will be required to issue a news release
with the Boards decisions and, if the Board determines not to accept a resignation, the news release will be required to state the reasons for that decision. A director who tenders his or her resignation pursuant to this policy will not be
permitted to participate in any meeting of the Board or the Corporate Governance and Nominating Committee at which the resignation is considered. A copy of the majority voting policy may be found on the Postmedia website at www.postmedia.com.



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The following table identifies the name and residence of the persons proposed to be nominated for
election by Shareholders as directors, their current positions with Postmedia, the date on which they first became a director of Postmedia and their principal occupations.



|                                                           |  |                                                 |  |                    |  |                                                                         
|---------------------------------------------------------- |  | ----------------------------------------------- |  | ------------------ |  | ------------------------------------------------------------------------
|NAME AND RESIDENCE                                         |  | POSITION WITH
POSTMEDIA                         |  | DIRECTOR SINCE     |  | PRINCIPAL OCCUPATION IF DIFFERENT FROM
POSITION HELD WITH POSTMEDIA     
|Rod Phillips(1)
Toronto, Ontario, Canada                   |  | Director and Chair of the Board of Directors    |  | February 5, 2014   |  | Corporate Director                                                      
|                                                           |  |                                                 | 
|Paul Godfrey Toronto, Ontario, Canada                      |  | Director, President and Chief Executive Officer |  | April 26, 2010     |  |                                                                         
|                                                           |  |                                                 | 
|Charlotte Burke(1)(2)(5)
Toronto, Ontario, Canada          |  | Director                                        |  | September 20, 2010 |  | Corporate Director                                                      
|                                                           |  |                                                 | 
|Stephanie Coyles(1)
Toronto, Ontario, Canada               |  | New Nominee                                     |  |                   |  | Strategy Consultant                                                     
|                                                           |  |                                                 | 
|Wendy Henkelman(1)
Calgary, Alberta, Canada                |  | New Nominee                                     |  |                   |  | Corporate Director                                                      
|                                                           |  |                                                 | 
|Mitch Joel(1)
Montreal, Quebec, Canada                     |  | New Nominee                                     |  |                   |  | President, Mirum Inc.                                                   
|                                                           |  |                                                 | 
|Ted Lodge
Lafayette Hill, Pennsylvania, U.S.A              |  | New Nominee                                     |  |                   |  | Partner of GoldenTree Asset Management LP                               
|                                                           |  |                                                 | 
|Martin Nisenholtz(1)(3)(5)
Brookline, Massachusetts, U.S.A |  | Director                                        |  | February 5, 2014   |  | Professor of the Practice of Digital Communications at Boston University
|                                                           |  |                                                 | 
|Graham Savage(1)(2)(3)
Toronto, Ontario, Canada            |  | Director                                        |  | July 12, 2010      |  | Corporate Director                                                      
|                                                           |  |                                                 | 
|Peter Sharpe(1)(3)(4)
Toronto, Ontario, Canada             |  | Director                                        |  | June 17, 2010      |  | Corporate Director                                                      
|                                                           |  |                                                 | 
|Robert Steacy(1)(2)(3)
Toronto, Ontario, Canada            |  | Director                                        |  | July 14, 2010      |  | Corporate Director                                                      



Notes:



|(1) | Independent member of the Board.
|--- | --------------------------------

|(2) | Member of the Audit Committee.
|--- | ------------------------------

|(3) | Member of the Compensation and Pension Committee.
|--- | -------------------------------------------------

|(4) | Member of the Corporate Governance and Nominating Committee.
|--- | ------------------------------------------------------------

|(5) | Member of the Digital Oversight Committee.
|--- | ------------------------------------------

Seven of the nominees are currently directors of Postmedia and had been elected for a term ending on the date of the annual general and
special meeting currently scheduled for January 13, 2016. Three of our current directors, Mr. Dow, Ms. Peverett and Mr. Shapiro will not be standing for re-election. The other four nominees, Stephanie Coyles, Wendy Henkelman,
Mitch Joel and Ted Lodge, are being nominated as directors of Postmedia for the first time. Each director elected at the annual general and special meeting currently scheduled for January 13, 2016 will hold office for a term expiring at the
close of the next annual meeting of Shareholders, or until the election of his or her successor, unless he or she resigns or his or her office becomes vacant by reasons of his or her death, removal or other cause.It is not expected that any of the
nominees will be unable, or for any reason will become unwilling, to serve as a director but should that occur prior to the election, the persons named in the form of proxy or voting instruction form reserve the right to vote for another nominee in
their discretion, unless the Shareholder has specified that his or her Shares be withheld from voting on the election of directors.

None
of the directors listed above are party to a service contract with the Corporation providing for benefits upon termination of employment.



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Details relating to the Corporations Audit Committee

Composition of the Audit Committee

The
members of the Corporations Audit Committee are:



|                      |  |                |  |                        
|--------------------- |  | -------------- |  | -----------------------
|Robert Steacy (Chair) |  | Independent(1) |  | Financially literate(2)
|Charlotte Burke       |  | Independent(1) |  | Financially literate(2)
|Jane Peverett         |  | Independent(1) |  | Financially literate(2)
|Graham Savage         |  | Independent(1) |  | Financially literate(2)



Notes:



|(1) | Pursuant to Canadian Law, a member of an audit committee is Independent if the member has no direct or indirect material relationship with the
Corporation, which could, in the view of the Board, reasonably interfere with the exercise of a members independent judgment.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | An individual is financially literate if he or she has the ability to read and understand a set of financial statements that present a breadth of
complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Corporations financial statements.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Relevant Education and Experience

In
addition to each members general business experience, the education and experience of each member of the Audit Committee that is relevant to the performance of their responsibilities as a member of the Audit Committee are set forth below:



| |  |  | Robert Steacy (Chair)  Prior to his retirement in 2005, Mr. Steacy was the Executive Vice President and Chief Financial
Officer of Torstar Corporation and had been its Senior Financial Officer for 16 years. In that capacity, he was responsible for overseeing all financial functions of that corporation (including all financial reporting, budgeting, tax, treasury
functions and internal audit). Mr. Steacy has been a Chartered Professional Accountant since 1976 (Institute of Chartered Professional Accountants of Ontario) and currently sits on the board of directors of Cineplex Inc. and is the Chairman of
the Board of Domtar Corporation. He also currently serves as chair of the audit committee for Cineplex Inc. Mr. Steacy has previously served as chair of the audit committees for each of Domtar Inc. and Somerset Entertainment Income Fund and sat
on the Audit Committee of Canadian Imperial Bank of Commerce and Alliance Atlantis Communications Inc. He earned his B. Comm from Queens University in 1973.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Charlotte Burke  Ms. Burke holds a Master of Business Administration from Harvard Business School and a Bachelor of
Business Administration in Accounting from Acadia University.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Jane Peverett - Ms. Peverett was President and Chief Executive Officer of the British Columbia Transmission Corporation (BCTC)
having previously served as its Chief Financial Officer. Ms. Peverett was also President and Chief Executive Officer of Union Gas Limited having previously served as its Chief Financial Officer. Ms. Peverett currently serves as chair of
the audit committee for each of Canadian Imperial Bank of Commerce and Encana Corporation. Ms. Peverett holds a Bachelor of Commerce degree from McMaster University and a Master of Business Administration degree from Queens University.
She is a Certified Management Accountant and a fellow of the Society of Management Accountants.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | Graham Savage  Mr. Savage has 38 years of experience in the finance and investment industry, including seven years as
Chief Financial Officer of a major public company. He has been a member of many board audit committees, many of which he chaired. Mr. Savage holds an undergraduate degree and an M.B.A. from Queens University.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Audit Committee assists the Board in, among other things, its oversight and evaluation of:



| |  |  | the quality and integrity of the financial statements of Postmedia;
| | - |  | -------------------------------------------------------------------



| |  |  | the compliance by Postmedia with legal and regulatory requirements in respect of financial disclosure;
| | - |  | ------------------------------------------------------------------------------------------------------



| |  |  | the qualification, independence and performance of the independent auditor;
| | - |  | ---------------------------------------------------------------------------



| |  |  | the assessment, monitoring and management of the financial, reporting and compliance risks involved with Postmedias business;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------



| |  |  | the enterprise risk management process; and
| | - |  | -------------------------------------------



| |  |  | the performance of the Executive Vice-President & Chief Financial Officer.
| | - |  | --------------------------------------------------------------------------

In addition, the Audit Committee provides an avenue for communication between the independent auditor, the Executive Vice President &
Chief Financial Officer and other financial senior management, other employees and the Board concerning accounting, auditing and risk management matters.

All members of the Audit Committee are independent and financially literate as contemplated by the rules of the Canadian
Securities Administrators. When considering criteria for determinations of financial literacy, Audit Committee members must be able to read and understand financial statements of a breadth and level of complexity of accounting issues generally
comparable to the issues expected to be raised by our consolidated financial statements.

The Audit Committee is directly responsible for
the recommendation of the appointment and retention (and termination) and for the compensation and the oversight of the work of the independent auditor (including oversight of the resolution of any disagreements between senior management and the
independent auditor regarding financial reporting) for the purposes of preparing audit reports and performing other audit, review or attest services. The Audit Committee has the authority to approve significant non-audit relationships with the
independent auditor and the terms of and fees for audit and non-audit engagements. The Audit Committee assesses the independence of the independent auditor and the independent auditors other relationships with Postmedia and reviews the scope
and planning of the external audit, the form of audit report and any correspondence from or comment by the independent auditor regarding financial reporting and internal controls.

We have adopted a policy requiring Audit Committee pre-approval of audit and non-audit services. Specifically, the Audit Committee is required
to pre-approve all audit and non-audit services (including any internal control-related services) provided by the independent auditor (subject to any restrictions on such non-audit services imposed by applicable legislation, regulatory requirements
and policies), with such responsibility delegated to the Chairman of the Audit Committee to pre-approve up to $250,000 of audit fees beyond the approved annual audit fee if approval of such fees is required between meetings of the Audit Committee.

Please see Item 16.C Principal Accountant Fees and Services for the fees billed by the Corporations external
auditors for Fiscal 2015 and Fiscal 2014 for audit, non-audit related services and tax services provided to the Corporation.



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The Audit Committee has unrestricted access to our personnel and documents and to the independent
auditor. The Audit Committee has primary oversight responsibility for our financial reporting and internal controls. It meets to review and discuss the annual and quarterly financial statements and accompanying managements discussion and
analysis and recommend their approval to the Board. However, it is not the responsibility of the Audit Committee to determine that our financial statements are complete and accurate and in accordance with IFRS, which is the responsibility of senior
management, or to plan and conduct audits of the financial statements, which is the responsibility of the independent auditor.

The Audit
Committee reviews significant accounting policies and principles and is updated regularly about current accounting issues and developments. The Audit Committee reviews the experience and qualifications of the senior members of the independent
auditors team.

The Audit Committee oversees an employee complaint procedure, pursuant to which our directors, officers and
employees and those of our subsidiaries will be encouraged to talk to supervisors, managers or other appropriate personnel about observed illegal or unethical behaviour and when in doubt about the best course of action in a particular situation.
Confidential complaint procedures have been established through a whistleblower hotline to facilitate the submission of complaints relating to any questionable accounting, internal accounting controls or auditing matters.

The Audit Committee charter provides that the Audit Committee is to meet at least quarterly and is to meet separately with senior management
periodically, and with the independent auditor as appropriate. The Audit Committee will also meet in camera at each of its regularly scheduled meetings. The Chair of the Audit Committee or the Board will determine whether it is necessary for
the Audit Committee to meet in camera after any of its non-regularly scheduled meetings.

None of the members of the Audit
Committee may serve on the audit committee of more than three public companies in addition to Postmedia without the prior approval of the Audit Committee, the Corporate Governance and Nominating Committee and the Board. None of the members of the
Audit Committee serves on the audit committee of more than three other public companies.

Role of the Compensation and Pension Committee

The members of the Compensation and Pension Committee are Messrs. Savage (Chair), Dow, Nisenholtz, Sharpe and Steacy, all of whom are
independent. The Compensation and Pension Committee is composed entirely of independent directors. Members of the Compensation and Pension Committee have gained relevant skills and experience with respect to their responsibilities for executive
compensation through holding a variety of senior executive management roles, including, for certain members, as chief executive officer of a business with the Human Resources and Finance functions reporting directly to them. In connection with their
past roles, most Compensation and Pension Committee members have managed and implemented a variety of compensation policies and programs. The Compensation and Pension Committee regularly reports to the Board in carrying out its responsibilities and
duties relating to compensation matters of the Corporation. The Compensation and Pension Committee regularly holds in camerasessions exclusive of management and executive directors and consults with independent advisors in respect of
compensation matters (for more information about the Corporations independent advisor, see Role of the Independent Consultant).

The Compensation and Pension Committee, through meetings, presentations and reports, understands the key drivers and issues affecting the
Corporation and regularly meets with senior management.

Consistent with the Compensation and Pension Committees charter and based
on input from management and the Compensation and Pension Committees independent advisor, the Compensation and Pension Committee reviews executive compensation and awards for each of the NEOs.



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As part of the executive compensation review, the Compensation and Pension Committee makes
recommendations to the Board on compensation levels and incentive plan awards for each of the NEOs based on the guiding principles described below, with particular reference to performance measures. The following outlines the principal
responsibilities of the Compensation and Pension Committee with respect to compensation matters:



| |  |  | reviews and makes recommendations to the Board in consultation with the CEO at least annually, with respect to the long-term goals and objectives
of the Corporation which are relevant to the CEOs compensation, evaluates the CEOs performance in light of those goals and objectives, determines and recommends to the independent directors, for approval, the CEOs compensation
based on that evaluation, and reports to the Board thereon. In determining the CEOs compensation, the Compensation and Pension Committee considers the Corporations performance, the value of similar incentive awards to chief executive
officers at comparable companies, the CEOs existing employment contract and the awards given to the CEO in past years, with a view to maintaining a compensation program for the CEO at a competitive level consistent with the best interests of
the Corporation;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews and makes recommendations to the Board at least annually (and upon appointment), in consultation with the CEO, with respect to the
compensation of those members of senior management that report directly to the CEO (including incentive-compensation plans, equity-based plans, the terms of any employment agreements, severance arrangements, and change in control arrangements or
provisions, and any special or supplemental benefits), with a view to maintaining a compensation program for senior management at a competitive level, consistent with the best interests of the Corporation;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews all executive compensation packages with annual cash compensation in excess of $300,000;
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | reviews and makes recommendations to the Board on incentive compensation program design and efficacy (including short term and long-term incentive
plans), and equity-based compensation programs for the Corporations directors, officers and employees, including share ownership guidelines;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews and makes recommendations to the Board on awards to employees of stock or Options or other awards pursuant to any of the Corporations
equity-based plans and exercises such other power and authority as may be permitted or required under those plans;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews the financial implications of the Corporations senior compensation plans, including post-retirement benefits and supplemental
employee retirement plan and funding thereof, if any;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews the potential results of the Corporations senior compensation programs under a wide variety of scenarios to ensure that the
Compensation and Pension Committee has an understanding of the linkage between Shareholder interests and senior management payouts;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews and approves annually any adjustments and guidelines made in respect of the Corporations compensation plans;
| | - |  | ---------------------------------------------------------------------------------------------------------------------



| |  |  | reviews and makes recommendations to the Board at least annually with respect to compensation of directors, the Chair and those acting as committee
chairs to, among other things, ensure their compensation appropriately reflects the responsibilities they are assuming;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | reviews and, as required, makes recommendations to the Board in co-operation with the Corporations senior management with respect to the
human resources policies and programs which are of strategic significance to the Corporation;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| |  |  | reviews all executive compensation disclosure prior to public disclosure by the Corporation; and
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | reviews and makes recommendations during periodic reviews with the Board with respect to the succession plans relating to the position of the CEO
and other senior positions with respect to the selection of individuals to occupy these positions;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

With respect to the
Corporations Pension Plans, the Compensation and Pension Committees principal duties are to oversee and monitor the management and overall governance of the pension and retirement plans sponsored and administered by the Corporation.

Risk Mitigation

The
Compensation and Pension Committee is aware that compensation programs, policies and practices should not encourage senior executives to take excessive and unnecessary risk, and monitors this on an ongoing basis by reviewing such programs, policies
and practices to ensure that executives do not make short-term decisions that could be detrimental to long-term Shareholder returns.

The
following measures impose appropriate safeguards to avoid excessive or inappropriate risk-taking:



| |  |  | the Compensation and Pension Committee reviews the performance-based compensation for senior executives and in doing so, reviews the compensation
mix of base salary, short-term and long-term incentives;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the Corporation promotes acceptable risk taking through the use of performance targets for its short-term incentive plan which has predefined
payout thresholds;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | risk is mitigated through the granting of long-term incentives such as Options, RSUs and PSUs that have multi-year vesting provisions; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | long-term incentives reward executives for taking a balanced focus on long-term performance and the achievement of long-term goals over a three to
ten year period.
| | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Compensation and Pension Committee is satisfied that current programs, policies and practices,
combined with the risk compliance reviews of the organization, promote acceptable risk taking with appropriate and reasonable incentive compensation and has not identified any risks with such programs, policies and practices that are reasonably
likely to have a material adverse effect on the Corporation.

Hedging Policy

The Corporation has a policy of prohibiting its employees from purchasing financial instruments, including, for greater certainty, prepaid
variable forward contracts, equity swaps, collars, or units of exchange traded funds, that are designed to hedge or offset a decrease in market value of securities of Postmedia held, directly or indirectly, by such employees, including equity
securities granted as compensation. Such policy is contained in the Corporations Timely Disclosure, Confidentiality and Insider Trading Policy.



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Role of the Independent Consultant

The Compensation and Pension Committee has engaged Hugessen Consulting Inc. (Hugessen) since November 5, 2010 to act as
its independent advisor to provide advice and guidance on compensation matters. All work undertaken by Hugessen is pre-approved by the Chair of the Compensation and Pension Committee. Hugessen provides no other services to Postmedia. Hugessen is
directly retained and instructed by and reports to the Compensation and Pension Committee. The decisions made by the Compensation and Pension Committee are the responsibility of the Compensation and Pension Committee and may reflect other factors
and considerations in addition to the information and recommendations from Hugessen.

The following table sets forth the fees paid to
Hugessen in the years ended August 31, 2015 and 2014 pertaining to professional consulting services. Such services included analysis and support in respect of NEO and director compensation, benchmarking, long-term incentive plan design and
assistance with an equity plan reserve request.



|            |  |                                     |  |               
|----------- |  | ----------------------------------- |  | --------------
|YEAR        |  | EXECUTIVE COMPENSATION RELATED FEES |  | ALL OTHER FEES
|FISCAL 2015 |  | 92,263                              |  |              
|FISCAL 2014 |  | 47,363                              |  |              

Executive Compensation Guiding Principles

The newsmedia industry is under significant pressure and the Corporation has been active in substantially transforming its business in
response.

The Corporations compensation programs must be able to adapt to the changing market environment and continue to be
aligned with business results and market best practices. While the Corporation works to significantly transform the business, the compensation programs key considerations will be to reward employees only when meaningful results that support
the Corporations strategic goals and Shareholder interests are achieved.

Within the context of total rewards, the Corporation seeks
to maintain an incentive structure that is attractive to new talent, particularly in the digital and sales areas, while at the same time managing costs and focusing on equity-based compensation that does not require large cash outlays.

Accountability for compensation program design and administration of such programs will be held by appropriate internal stakeholders and
overseen by the Compensation and Pension Committee with input from external consultants. The Corporations approach to compensation for all employees, including the NEOs, is guided by the following principles:



| |  |  | assessing the financial reality to support our compensation programs must be aligned and reward when the business is successfully transformed;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | attracting and retaining the best talent that will transform the Corporations business through programs that reflect its values and are
considered, but are not dictated by, market practice;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | managing the costs of incentive programs while maintaining their purpose and benefits;
| | - |  | --------------------------------------------------------------------------------------



| |  |  | keeping programs simple to communicate to our employees and are transparent to Shareholders; and
| | - |  | ------------------------------------------------------------------------------------------------



| |  |  | ensuring good governance by developing compensation programs that do not encourage excessive risk taking.
| | - |  | ---------------------------------------------------------------------------------------------------------



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Competitive Benchmarking

In July 2013, the Compensation and Pension Committee requested that Hugessen assist the Committee by reviewing the competitiveness of the
compensation levels for the NEOs, using a comparator peer group of publicly listed companies.

The review focused on the total
direct compensation (TDC) composed of base salary, short-term incentives and long-term incentives received by the NEOs. For benchmarking purposes, Hugessen matched the CEO and CFO positions with the counterparts of the comparator peer
group companies. For the other NEO positions, Hugessen matched these positions based on their TDC ranking.

Hugessen assessed the NEOs
compensation levels competitiveness by using the comparator peer group companies developed and approved by the Compensation and Pension Committee. The following table identifies the four screening criteria used to select the comparator peer
group of companies.



|                               |  |                                                                                   
|------------------------------ |  | ----------------------------------------------------------------------------------
|COMPARATOR PEER GROUP CRITERIA
|Primary Listing                |  | Toronto Stock Exchange                                                            
|Geographic Location            |  | Headquartered in Canada                                                           
|Industry Classification        |  | Media                                                                             
|Size/Financial Criteria        |  | Latest total Enterprise Value between approximately $400 million and
$2.5 billion.

The screening identified the following ten companies:



| |  |  | Aimia Inc.
| | - |  | ----------



| |  |  | Astral Media Inc.
| | - |  | -----------------



| |  |  | Cineplex Inc.
| | - |  | -------------



| |  |  | Cogeco Cable Inc.
| | - |  | -----------------



| |  |  | Corus Entertainment Inc.
| | - |  | ------------------------



| |  |  | Glacier Media Inc.
| | - |  | ------------------



| |  |  | Mood Media Corporation
| | - |  | ----------------------



| |  |  | Torstar Corporation
| | - |  | -------------------



| |  |  | TVA GROUP Inc.
| | - |  | --------------



| |  |  | Yellow Media Limited
| | - |  | --------------------

The Compensation and Pension Committee utilized the July 2013 benchmarking review to assess the NEOs compensation for Fiscal 2014 and Fiscal
2015 and determined to leave the compensation levels of the NEOs unchanged for Fiscal 2015.



|D. | Employees
|-- | ---------

As of August 31, 2015 the Corporation employed 4,733 full time equivalent employees. Approximately 29% of the Corporations employees
are unionized under 54 separate collective agreements as of August 31, 2015. In general, the Corporations collective bargaining agreements cover operations at individual locations, rather than multiple locations. Additional information on
the collective bargaining agreements is provided in the MD&A attached hereto as Exhibit 15.2.



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|E. | Share Ownership
|-- | ---------------

The following table identifies the name and residence of those individuals who are directors and NEOs of the Corporation, their current
positions or offices with the Corporation, and the number of Shares, Options, DSUs and RSUs beneficially owned, directly or indirectly, or under their direction or control as of November 17, 2015:



|                                                  |  |                                                                                        |  |                                                                 |  |                                                                                 |  |                                                            
|------------------------------------------------- |  | -------------------------------------------------------------------------------------- |  | --------------------------------------------------------------- |  | ------------------------------------------------------------------------------- |  | -----------------------------------------------------------
|                                                  |  |                                                                                        |  |                                                                
|NAME AND RESIDENCE                                |  | POSITION WITH THE CORPORATION                                                          |  | NUMBER OF SHARES BENEFICIALLY OWNED,
DIRECTLY OR INDIRECTLY (#) |  | NUMBER OF OPTIONS,
DSUS AND RSUS BENEFICIALLY OWNED, DIRECTLY OR INDIRECTLY
(#) |  | PERCENTAGE OFSHARES OWNED
IN RESPECT OFPARTICULAR CLASS
(%)
|Rod Phillips Toronto, Ontario, Canada             |  | Director and Chair of the Board of Directors                                           |  |                                                                |  | 179,353 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Paul Godfrey Toronto, Ontario,
Canada             |  | Director, President and Chief Executive Officer                                        |  | 108,000 Voting Shares(1) 647,233 Variable Voting Shares         |  | 750,000 Options plus 600,000 Tandem Options/RSUs(2)                             |  | 10.48%**                                                   
|                                                  |  |                                                                                        |  |                                                                
|Charlotte Burke Toronto, Ontario,
Canada          |  | Director                                                                               |  |                                                                |  | 153,600 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Hugh F. Dow Toronto, Ontario,
Canada              |  | Director                                                                               |  |                                                                |  | 143,516 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Martin Nisenholtz
Brookline, Massachusetts, U.S.A |  | Director                                                                               |  |                                                                |  | 106,283 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Jane Peverett
Vancouver, British Columbia, Canada |  | Director                                                                               |  |                                                                |  | 107,983 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Graham Savage Toronto, Ontario,
Canada            |  | Director                                                                               |  |                                                                |  | 184,520 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Steven Shapiro(3)
New York, New York, U.S.A.      |  | Director                                                                               |  |                                                                |  | 140,702 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Peter Sharpe Toronto, Ontario,
Canada             |  | Director                                                                               |  | 25,000 Voting Shares
149,822 Variable Voting Shares             |  | 173,173 DSUs                                                                    |  | 2.43%**                                                    
|                                                  |  |                                                                                        |  |                                                                
|Robert Steacy Toronto, Ontario,
Canada            |  | Director                                                                               |  |                                                                |  | 184,520 DSUs                                                                    |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Douglas Lamb Toronto, Ontario,
Canada             |  | Executive Vice President and Chief Financial Officer                                   |  | 21,600 Voting Shares                                            |  | 315,000 Options                                                                 |  | 2.10%                                                      
|                                                  |  |                                                                                        |  |                                                                
|Wayne Parrish(4)
Toronto, Ontario, Canada         |  | Chief Operating Officer                                                                |  | 21,600 Voting Shares                                            |  |                                                                                |  | 2.10%                                                      
|                                                  |  |                                                                                        |  |                                                                
|Andrew MacLeod Kitchener, Ontario,
Canada         |  | Executive Vice President and Chief Commercial Officer                                  |  |                                                                |  | 50,000 Options                                                                  |  |                                                           
|                                                  |  |                                                                                        |  |                                                                
|Gordon Fisher Toronto, Ontario,
Canada            |  | President, National Post and Executive Vice President Reader Revenue and Manufacturing |  | 4,632 Voting Shares 70,453 Variable Voting Shares(5)            |  | 330,000 Options                                                                 |  | ***                                                        
|                                                  |  |                                                                                        |  |                                                                
|Jeffrey Haar Toronto, Ontario,
Canada             |  | Executive Vice President and General Counsel                                           |  |                                                                |  | 120,000 Options                                                                 |  |                                                           



|* | denotes a percentage of Share ownership less than 1% of Voting Shares.
|- | ----------------------------------------------------------------------

|** | denotes a percentage of Share ownership less than 1% of Variable Voting Shares.
|-- | -------------------------------------------------------------------------------



Notes:



|(1) | These Voting Shares are held by the Paul and Gina Godfrey Sons Family Trust, of which Mr. Godfrey is a trustee.
|--- | ---------------------------------------------------------------------------------------------------------------

|(2) | Mr. Godfrey received a grant of 600,000 tandem Options/RSUs. In the event that he exercises the Options, the corresponding number of RSUs will
be automatically forfeited for no consideration. In the event that he exercises the RSUs, the corresponding number of Options will be automatically forfeited for no consideration
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Mr. Shapiro is a Founding Partner and Portfolio Manager at GoldenTree. Certain investment funds for which GoldenTree serves as investment
advisor beneficially own or exercise control and direction over 146,694,259 Variable Voting Shares of the Corporation as at November 17, 2015.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Mr. Parrishs employment with the Corporation ended July 6, 2015.
|--- | -----------------------------------------------------------------

|(5) | Of these Variable Voting Shares, 54,000 are held by the Gordon Fisher Family Trust, of which Mr. Fisher is a trustee.
|--- | ---------------------------------------------------------------------------------------------------------------------



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Share Ownership Guidelines

The Board has adopted share ownership guidelines for directors. Each non-executive director is required to acquire Shares having a value of
three times the base annual director fees, which at this time amounts to $360,000. Non-executive directors are expected to achieve this level of ownership within five years from the date they became directors. Directors may apply RSUs and DSUs which
they have received or earned or are owing to them towards this minimum equity ownership requirement, but only to the extent that such RSUs or DSUs have vested. Directors may also apply Shares that are beneficially owned by them or a family member
towards this minimum equity ownership requirement. Directors who are nominated by a Shareholder pursuant to a nominating agreement with the Corporation may apply Shares held by such nominating Shareholder and its affiliates towards this minimum
share ownership requirement. To determine whether a director has met this minimum share ownership level, Shares, RSUs and DSUs will be valued at the greater of: (a) their value at the time of acquisition or grant; and (b) the current
market price of the applicable Shares.

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS



|A. | Major Shareholders.
|-- | -------------------

The following table shows, as of November 17, 2015, the persons or companies who, to the actual knowledge of the Corporation, beneficially
own, or control or direct, directly or indirectly, Shares of the Corporation carrying 5% or more of the Shares in each class.

Variable Voting Shares



|                               |  |                                                          |  |                           
|------------------------------ |  | -------------------------------------------------------- |  | --------------------------
|Name                           |  | Number and Class of
Shares Owned,
Controlled or Directed |  | Percentage of Shares Owned
|GoldenTree Asset Management LP |  | 146,694,259 Variable Voting Shares                       |  | 52.36%                    
|Canso Investment Counsel Ltd.  |  | 56,595,013 Variable Voting Shares                        |  | 20.20%                    

Voting Shares



|                                            |  |                                                          |  |                           
|------------------------------------------- |  | -------------------------------------------------------- |  | --------------------------
|Name                                        |  | Number and Class of
Shares Owned, Controlled or
Directed |  | Percentage of Shares Owned
|The Paul And Gina Godfrey Sons Family Trust |  | 108,000 Voting Shares                                    |  | 10.48%                    



|B. | Related Party Transactions.
|-- | ---------------------------

Other than as disclosed in this annual report, including the agreements described below, to the knowledge of the directors and executive
officers of Postmedia, no informed person (as defined by Canadian securities law) or any associate or affiliate of any informed person, has had any material interest, direct or indirect, by way of beneficial ownership of
securities or otherwise, in any material transaction with us since September 1, 2012 or has any such interest in any proposed transaction that has materially affected or would materially affect Postmedia or our subsidiaries.

On July 13, 2010, Postmedia entered into a registration rights agreement and a nominating agreement with GoldenTree, a principal
Shareholder of Postmedia. See Item 10.C  Material Contracts.



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Standby Purchase Agreement

In connection with the Sun Acquisition, on October 6, 2014, Postmedia entered into a standby purchase agreement with its largest
Shareholder, GoldenTree (the Standby Purchase Agreement), pursuant to which GoldenTree agreed to take up any subscription receipts not otherwise subscribed for under the Rights Offering, subject to the satisfaction of certain
conditions. GoldenTree was paid $7.1 million for acting as standby purchaser under the Standby Purchase Agreement. See Item 4.A History and Development of the Company  Significant Post-Acquisition Events for more information
on the Sun Acquisition and the Rights Offering.

Conversion Restriction Agreement

In December 2014, Canso announced that certain investment funds and accounts over which it had control or direction acquired 3,325,827 Variable
Voting Shares (which, if converted into Voting Shares would have represented 77.90% of the total outstanding Voting Shares at that time). The Corporation entered into a conversion restriction agreement with Canso dated December 11, 2014 (the
Conversion Restriction Agreement), pursuant to which Canso has agreed that during the term of the agreement it and its affiliates and any accounts over which it or its affiliates exercise control or direction and any persons
acting jointly or in concert with Canso or its affiliates (all such persons, together with Canso, are referred to herein as the Canso Group) will not convert any of the Variable Voting Shares beneficially owned by any member of the Canso
Group or over which any member of the Canso Group exercises control or direction (including, without limitation, any Variable Voting Shares over which beneficial ownership or control or direction is acquired following the date of such agreement)
into Voting Shares, where the Voting Shares acquired upon such conversion, together with the Voting Shares beneficially owned by members of the Canso Group or over which members of the Canso Group exercise control or direction, represent in the
aggregate 20% or more of the outstanding Voting Shares on a post-conversion basis (excluding all Variable Voting Shares not being converted and other securities convertible into, exercisable into or exchangeable for Voting Shares), without the prior
written consent of the Corporation, which consent may be withheld at the Corporations sole discretion. The Conversion Restriction Agreement may only be terminated (i) with the mutual consent of the Corporation and Canso; or
(ii) following the termination of the Postmedia Rights Plan or the redemption of the rights thereunder (other than a redemption by the Board under certain conditions).



|C. | Interests of Experts and Counsel.
|-- | ---------------------------------

Not applicable.

ITEM 8. FINANCIAL INFORMATION



|A. | Consolidated Statements and Other Financial Information.
|-- | --------------------------------------------------------

Please refer to the Corporations audited consolidated financial statements for the years ended August 31, 2015, 2014 and 2013,
attached hereto as Exhibit 15.1.

Legal Proceedings

The Corporation is involved in various legal claims arising in the ordinary course of its newspaper and digital media and online businesses.
The majority of these claims are brought pursuant to defamation legislation in the province of publication. The Corporation maintains a multi-media liability insurance policy in respect of defamation claims. Subject to the terms and conditions of
that policy, and the insurers coverage position in respect of individual claims, the resolution of these matters is not expected to have a material adverse effect on the Corporations consolidated financial position, results of operations
or cash flows.



|B. | Significant Changes.
|-- | --------------------

Not applicable.



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ITEM 9. THE OFFER AND LISTING



|A. | Offer and listing details.
|-- | --------------------------

The outstanding Voting Shares and Variable Voting Shares of the Corporation trade on the TSX under the symbols PNC.A and
PNC.B, respectively. The following table sets forth the reported high and low prices and the trading volume for the periods indicated:



|               |  |       |       |  |       |   |       |      |  |   |       |  |  |   |       | 
|-------------- |  | ----- | ----- |  | ----- | - | ----- | ---- |  | - | ----- |  |  | - | ----- | 
|Period         |  | PNC.A |       |  | PNC.B |  
|               |  | High  |       |  | Low   |   |       | High |  |   | Low   | 
|Fiscal 2015    |  | $     | 2.20  |  |       | $ | 0.37  |      |  | $ | 3.10  |  |  | $ | 0.40  | 
|Fiscal 2014    |  | $     | 2.11  |  |       | $ | 0.87  |      |  | $ | 2.32  |  |  | $ | 1.60  | 
|Fiscal 2013    |  | $     | 2.38  |  |       | $ | 1.30  |      |  | $ | 2.40  |  |  | $ | 1.15  | 
|Fiscal 2012    |  | $     | 12.50 |  |       | $ | 0.70  |      |  | $ | 16.00 |  |  | $ | 0.78  | 
|Fiscal 2011    |  | $     | 17.00 |  |       | $ | 10.00 |      |  | $ | 17.75 |  |  | $ | 10.00 | 
|               |  |      
|Period         |  | PNC.A |       |  | PNC.B |  
|               |  | High  |       |  | Low   |   |       | High |  |   | Low   | 
|Q4 Fiscal 2015 |  | $     | 1.00  |  |       | $ | 0.37  |      |  | $ | 0.84  |  |  | $ | 0.40  | 
|Q3 Fiscal 2015 |  | $     | 1.10  |  |       | $ | 0.80  |      |  | $ | 1.05  |  |  | $ | 0.80  | 
|Q2 Fiscal 2015 |  | $     | 2.20  |  |       | $ | 1.90  |      |  | $ | 2.25  |  |  | $ | 1.05  | 
|Q1 Fiscal 2015 |  | $     | 2.20  |  |       | $ | 1.48  |      |  | $ | 3.10  |  |  | $ | 1.55  | 
|Q4 Fiscal 2014 |  | $     | 1.50  |  |       | $ | 0.87  |      |  | $ | 2.30  |  |  | $ | 1.60  | 
|Q3 Fiscal 2014 |  | $     | 1.81  |  |       | $ | 0.87  |      |  | $ | 2.32  |  |  | $ | 1.84  | 
|Q2 Fiscal 2014 |  | $     | 1.90  |  |       | $ | 1.35  |      |  | $ | 2.10  |  |  | $ | 1.95  | 
|Q1 Fiscal 2014 |  | $     | 2.11  |  |       | $ | 1.90  |      |  | $ | 2.20  |  |  | $ | 2.00  | 
|               |  |      
|Period         |  | PNC.A |       |  | PNC.B |  
|               |  | High  |       |  | Low   |   |       | High |  |   | Low   | 
|August 2015    |  | $     | 0.65  |  |       | $ | 0.37  |      |  | $ | 0.67  |  |  | $ | 0.40  | 
|July 2015      |  | $     | 0.65  |  |       | $ | 0.65  |      |  | $ | 0.80  |  |  | $ | 0.59  | 
|June 2015      |  | $     | 1.00  |  |       | $ | 0.65  |      |  | $ | 0.84  |  |  | $ | 0.65  | 
|May 2015       |  | $     | 1.00  |  |       | $ | 1.00  |      |  | $ | 0.88  |  |  | $ | 0.80  | 
|April 2015     |  | $     | 1.10  |  |       | $ | 0.80  |      |  | $ | 0.95  |  |  | $ | 0.80  | 
|March 2015     |  | $     | 0.80  |  |       | $ | 0.80  |      |  | $ | 1.05  |  |  | $ | 0.80  | 



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|B. | Plan of Distribution.
|-- | ---------------------

Not applicable.



|C. | Markets.
|-- | --------

The Corporations Voting Shares and Variable Voting Shares trade on the TSX.



|D. | Dilution.
|-- | ---------

Not applicable.



|E. | Expenses of the issue.
|-- | ----------------------

Not applicable.

ITEM 10. ADDITIONAL INFORMATION



|A. | Share Capital.
|-- | --------------

Not applicable.



|B. | Memorandum and Articles of Association.
|-- | ---------------------------------------

The articles of incorporation and articles of amendment (collectively, the Articles) of the Corporation are incorporated by
reference to the information in our registration statement on Form F-4 filed with the Securities and Exchange Commission, in Washington, D.C. on June 8, 2011 to which our Articles of Incorporation and Articles of Amendment were filed as
exhibits.

No further changes have been made to the Corporations Articles. The Corporations Articles do not place any
restrictions on the business that the Corporation may carry on.

On October 24, 2013, the board of directors of the Corporation (the
Board) approved, and on January 9, 2014, the Shareholders ratified, amendments to the Corporations by-laws to include advance notice provisions, the purpose of which is to require advance notice to be provided to the
Corporation in circumstances where nominations of persons for election to the Board are made by Shareholders other than pursuant to: (i) a requisition of a meeting of Shareholders made pursuant to the provisions of the CBCA; or (ii) a
Shareholder proposal made pursuant to the provisions of the CBCA.A copy of the by-law amendment was filed as Exhibit 99.1 to the Registrants Form 6-K filed on October 25, 2013.

On April 13, 2015, the Corporation acquired all of the outstanding shares of 7717415 Canada Inc. as part of the Sun Acquisition. Upon
acquisition, 7717415 Canada Inc. and its subsidiary 8869332 Canada Inc. amalgamated to form a new corporation which subsequently amalgamated with Postmedia Network Inc.



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Certain Powers of Directors

The Canada Business Corporations Act(the CBCA) requires that every director who is a party to a material
contract or transaction or a proposed material contract or transaction with a corporation, or who is a director or officer of, or has a material interest in, any person who is a party to a material contract or transaction or a proposed material
contract or transaction with the corporation, shall disclose in writing to the corporation or request to have entered in the minutes of the meetings of directors the nature and extent of his or her interest, and shall refrain from voting in respect
of the material contract or transaction or proposed material contract or transaction unless the contract or transaction is: (a) one relating primarily to his or her remuneration as a director, officer, employee or agent of the corporation or an
affiliate; (b) one for indemnity of or insurance for directors as contemplated under the CBCA; or (c) one with an affiliate. However, a director who is prohibited by the CBCA from voting on a material contract or proposed material contract
may be counted in determining whether a quorum is present for the purpose of the resolution, if the director disclosed his or her interest in accordance with the CBCA, the directors approved the contract or transaction, and the contract or
transaction was reasonable and fair to the corporation at the time it was approved. The Corporations by-laws provide that the directors shall from time to time determine by resolution the remuneration to be paid to the directors, which shall
be in addition to the salary paid to any officer or employee of the Corporation who is also a director.

The directors may also by
resolution award special remuneration to any director in undertaking any special services on the Corporations behalf other than the normal work ordinarily required of a director of the Corporation. The by-laws provide that confirmation of any
such resolution by the Corporations Shareholders is not required.

The CBCA provides that, unless otherwise provided in the
Corporations articles or by-laws, the directors may without authorization of the shareholders: (a) borrow money on the credit of the Corporation; (b) issue, reissue, sell, pledge or hypothecate debt obligations of the Corporation;
(c) give a guarantee on behalf of the Corporation to secure performance of an obligation of any person; and (d) mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the Corporation, owned or
subsequently acquired, to secure any obligation of the Corporation.

The directors may, by resolution, make, amend or repeal any by-laws
that regulate the business or affairs of the Corporation. The CBCA requires the directors to submit any such amendment or repeal of a by-law to the Corporations Shareholders at the next meeting of Shareholders, and the Shareholders may, by
ordinary resolution, confirm, reject or amend the by-law, amendment or repeal.

Meetings of Shareholders

The CBCA requires the Corporation to call an annual Shareholders meeting not later than 15 months after holding the last preceding annual
meeting but no later than six months after the end of the Corporations preceding financial year and permits the Corporation to call a special Shareholders meeting at any time. In addition, in accordance with the CBCA, the holders of not
less than 5% of the Corporations shares carrying the right to vote at a meeting sought to be held may requisition the directors to call a Shareholders meeting for the purposes stated in the requisition. The Corporation is required to
mail a notice of meeting and management information circular to registered Shareholders not less than 21 days and not more than 60 days prior to the date of any annual or special Shareholders meeting. These materials also are filed with
Canadian securities regulatory authorities and the SEC. The Corporations by-laws provide that a quorum of two Shareholders in person or represented by proxy holding or representing by proxy not less than 10% of the Corporations issued
shares carrying the right to vote at the meeting is required to transact business at a Shareholders meeting. Shareholders, and their duly appointed proxies and corporate representatives, as well as the Corporations auditors, are entitled
to be admitted to the Corporations annual and special Shareholders meetings.



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Disclosure of Share Ownership

The Securities Act(Ontario) provides that a person or company that beneficially owns, directly or indirectly, voting
securities of an issuer or that exercises control or direction over voting securities of an issuer or a combination of both, carrying more than 10% of the voting rights attached to all the issuers outstanding voting securities (a
reporting insider) must, within ten days of becoming a reporting insider, file a report in the required form disclosing the reporting insiders (i) beneficial ownership of, or control or direction over, whether direct or
indirect, securities of the issuer and (ii) any interest in, or right or obligation associated with, a related financial instrument involving a security of the issuer. The Securities Act(Ontario) also provides for the filing
of a report by a reporting insider of a reporting issuer in respect of a change in the reporting insiders (i) beneficial ownership of, or control or direction over, whether direct or indirect, securities of the reporting issuer or
(ii) interest in, or right or obligation associated with, a related financial instrument involving a security of the reporting issuer. This report must be filed within five days after the date on which the change occurs. The Securities
Act(Ontario) also provides that a person or company that acquires beneficial ownership of, or the power to exercise control or direction over, voting or equity securities of any class or securities convertible into voting or equity
securities of any class of a reporting issuer that, together with previously held securities brings the total holdings of such holder to 10% or more of the outstanding securities of that class, must (a) promptly issue and file a news release
containing the prescribed information and (b) file a report within two business days from the date of the acquisition containing the same information set out in the news release. The acquiring person or company must also issue a press release
and file a report each time it acquires an additional 2% or more of the outstanding securities of the same class and every time there is a material change to the contents of the news release and report previously issued and filed.

Dividends

The Corporation has not
paid dividends and its current intention is not to declare dividends for the foreseeable future. Any future determination to pay cash dividends is at the discretion of the Board and will depend on Postmedias financial condition, results of
operations, capital requirements and such other factors as the Board deems relevant. Pursuant to the CBCA, the Corporation may not declare or pay a dividend if there are reasonable grounds for believing that: (i) the Corporation is, or would
after the payment be, unable to pay its liabilities as they become due; or (ii) the realizable value of its assets would thereby be less than the aggregate of its liabilities and stated capital of all classes. There are also certain
restrictions in the agreements relating to the First-Lien Notes and the Second-Lien Notes which limit the ability of the Corporation to pay dividends.

Authorized Capital - General

The
Corporations authorized capital consists of two classes: Voting Shares and Variable Voting Shares. The Corporation is authorized to issue an unlimited number of Voting Shares and Variable Voting Shares. As of November 17, 2015, there were
1,030,622 Voting Shares and 280,151,223 Variable Voting Shares issued and outstanding. A summary of the rights attaching to the Voting Shares and Variable Voting Shares are set forth below.

Rights upon Liquidation, Dissolution or Winding-Up

Subject to the rights, privileges, restrictions and conditions attaching to any future shares of the Corporation ranking senior to the Voting
Shares, upon liquidation, dissolution or winding up of the Corporation or other distribution of the Corporations assets among its Shareholders for the purpose of winding up its affairs, the holders of the Voting Shares and Variable Voting
Shares shall be entitled to share equally, share for share, in all distributions of such assets.



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Voting Shares

Voting rights

Holders of the Voting
Shares shall be entitled to receive notice of, and to attend and vote at, all meetings of the Shareholders of the Corporation (except where the holders of a specified class are entitled to vote separately as a class as provided in the CBCA), and
each Voting Share shall entitle the holder to one vote on each item of business in person or by proxy at all meetings of Shareholders of the Corporation.

Dividends

Subject to the rights,
privileges, restrictions and conditions attaching to the shares of the Corporation of any future class ranking senior to the Voting Shares, the holders of the Voting Shares shall, at the discretion of the directors, be entitled to receive, out of
monies, assets or property of the Corporation properly applicable to the payment of dividends, any dividends declared and payable by the Corporation on the Voting Shares. The Voting Shares shall rank equally as to dividends on a share-for-share
basis with the Variable Voting Shares and all dividends declared in any fiscal year of the Corporation shall be declared in equal or equivalent amounts per share on all Voting Shares and Variable Voting Shares at the time outstanding, without
preference or distinction.

Subdivision or Consolidation

No subdivision or consolidation of the Voting Shares or the Variable Voting Shares shall occur unless, simultaneously, the shares of the other
class are subdivided or consolidated in the same manner, so as to maintain and preserve the relative rights of the holders of the shares of each of the said classes.

Conversion

An issued and outstanding
Voting Share shall be converted into one Variable Voting Share, automatically and without any further act of the Corporation or the holder, if such Voting Share becomes held or beneficially owned or controlled, directly or indirectly, otherwise than
by way of security only, by one or more persons who are citizens or subjects of a country other than Canada or are controlled by one or more citizens or subjects of a country other than Canada (each a Non-Canadian). In addition to
the automatic conversion feature, a holder of Voting Shares shall have the option at any time to convert some or all of such shares into Variable Voting Shares on a one-for-one basis and to convert those shares back to Voting Shares on a one-for-one
basis.

Constraints on Ownership of Shares

The Voting Shares may only be beneficially owned and controlled, directly or indirectly, by persons that are not Non-Canadian.

Variable Voting Shares

General

The Variable Voting Shares have identical terms as the Voting Shares and rank equally with respect to voting, dividends and rights upon
liquidation, distribution and winding up, except that Variable Voting Shares shall not carry one vote per Variable Voting Share if:



| | (a) | the number of issued and outstanding Variable Voting Shares exceeds 49.9% of the total number of all issued and outstanding Shares; or
| | --- | --------------------------------------------------------------------------------------------------------------------------------------



| | (b) | the total number of votes that may be cast by or on behalf of holders of Variable Voting Shares present at any meeting of holders of Shares exceeds
49.9% of the total number of votes that may be cast by all holders of Shares present and entitled to vote at such meeting.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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If either of the above-noted thresholds is surpassed at any time, the vote attached to each
Variable Voting Share will decrease automatically and without further act or formality, to equal the maximum permitted vote per Variable Voting Share as indicated below. Under the circumstance described in subparagraph (a) above, the Variable
Voting Shares as a class cannot carry more than 49.9% of the aggregate votes. Under the circumstance described in subparagraph (b) above, the Variable Voting Shares as a class cannot, for the applicable Shareholders meeting, carry more
than 49.9% of the total number of votes that can be cast at the meeting.

Conversion

An issued and outstanding Variable Voting Share shall be converted into one Voting Share, automatically and without any further act of the
Corporation or the holder, if (a) such Variable Voting Share is not or ceases to be beneficially owned or controlled, directly or indirectly, otherwise than by way of security only, by one or more Non-Canadians, unless such Variable Voting
Share resulted from the exercise of a voluntary election to convert a Voting Share into a Variable Voting Share, or (b)(i) the foreign ownership restrictions of the Tax Act are repealed and not replaced with other similar restrictions in the
Tax Act or other applicable legislation and (ii) there is no Canadian federal or provincial law applicable to the Corporation prescribed for the purposes of subsection 46(1) or paragraph 174(1)(c) of the CBCA or any other similar provision in
the CBCA or the CBCA Regulations.

Coattail Provision

In the event that an offer is made to purchase Voting Shares or Variable Voting Shares and the offer is one which must, pursuant to applicable
securities legislation or the rules of a stock exchange on which the Shares are then listed, be made to all or substantially all the holders of the Shares of such class, and a concurrent offer at an equal price and with identical terms (subject to
certain exceptions) is not made to purchase the Shares of such other class, each Variable Voting Share or Voting Share, as the case may be, shall become convertible at the option of the holder into one Share of the other class that shall be subject
to the offer at any time while the offer is in effect. The conversion right may only be exercised in respect of Shares for the purpose of depositing the resulting Shares in response to the offer and a Canadian trustee designated by the Corporation
shall deposit the resulting Shares on behalf of the Shareholder.

If the Shares resulting from the conversion and deposited pursuant to
the offer are withdrawn from the offer or are not taken up by the offeror or if the offer is abandoned or withdrawn, the Shares resulting from the conversion shall be reconverted back into the original class automatically and without further act
from the Corporation or the holder.

Declaration as to Canadian Status

Under the Corporations articles of incorporation, the directors may, prior to the issuance of any Shares or the registration or transfer
of any Shares, require that there be submitted to the Corporation and/or its transfer agent, a declaration setting forth the name of the person who beneficially will own or control such Shares and whether or not such person is a Non-Canadian, as
well as such other information as the Board considers relevant for purposes of determining whether that person is in compliance with the restrictions on issue or transfer of the Shares.

In order to ensure it complies with its share ownership restrictions, Postmedia has in place special operating procedures for monitoring share
ownership that are designed to ensure that the share register of each of the Voting Shares and Variable Voting Shares remains accurate. These procedures establish that Computershare Investor Services Inc., the Corporations transfer agent, will
make periodic inquiries of intermediaries holding Voting Shares for non-registered holders to ensure compliance with shareholding ownership requirements.



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Shareholder Rights Plan

The Postmedia Rights Plan was reconfirmed at the annual general and special meeting of Shareholders of the Corporation held on January 9,
2014 and will remain in force until the earlier of the Termination Time (the time at which the right to exercise rights will terminate pursuant to the Postmedia Rights Plan) and the annual general meeting of Shareholders of Postmedia three years
thereafter unless at or prior to such meeting the Shareholders ratify the continued existence of the Postmedia Rights Plan.

The following
is a summary of the key features of the Postmedia Rights Plan. This summary does not purport to be complete and is subject to, and qualified in its entirety by reference to, the provisions of the Postmedia Rights Plan, the full text of which is
available on the SEDAR website at www.sedar.com on the EDGAR website at www.sec.gov. (Capitalized terms used in this section not otherwise defined herein have the meaning attributed to them in the Postmedia Rights Plan).

Issuance of Rights

One Right has been
issued by Postmedia in respect of each Voting Share and Variable Voting Share outstanding at the Effective Time and will continue to be issued in respect of each Voting Share and Variable Voting Share issued thereafter and prior to the earlier of
the Separation Time (as defined below) and the Expiration Time. Under the Postmedia Rights Plan, the Rights are confirmed and Postmedia confirms its authorization to continue the issuance of new Rights for each Voting Share and Variable Voting Share
issued. Each Right entitles the registered holder thereof to purchase from Postmedia one Voting Share or Variable Voting Share, as the case may be. The Exercise Price under the Postmedia Rights Plan is an amount equal to three times the market
price, from time to time, per Voting Share or Variable Voting Share, as the case may be. The Rights are not exercisable until the Separation Time. If a Flip-In Event (as defined below) occurs, each Right will entitle the registered holder to
receive, upon payment of the Exercise Price, the number of Voting Shares or Variable Voting Shares, as applicable, having an aggregate Market Price on the date of consummation or occurrence of such Flip-In Event equal to ten times the relevant
Exercise Price for an amount in cash equal to the relevant Exercise Price.

Under the Postmedia Rights Plan, Postmedia is not required to
issue or deliver Rights, or securities issuable upon the exercise of Rights, outside of Canada, where such issuance or delivery would be unlawful without registration of the relevant Persons or securities. If the Postmedia Rights Plan would require
compliance with securities laws or comparable legislation of a jurisdiction outside of Canada, Postmedia may establish procedures for the issuance to a Canadian resident fiduciary of such securities, to hold such Rights or other securities in trust
for the Persons beneficially entitled to them, to sell such securities, and to remit the proceeds to such Persons.

Trading of Rights

Until the Separation Time (or the earlier termination or expiration of the Rights), the Rights will be evidenced by the certificates
representing Voting Shares or Variable Voting Shares, as the case may be, and will be transferable only together with such associated shares. From and after the Separation Time and prior to the Expiration Time, separate certificates evidencing the
Rights (Rights Certificates), together with a disclosure statement prepared by Postmedia describing the Rights, will be mailed to holders of record of Voting Shares and Variable Voting Shares (other than an Acquiring Person) as of
the Separation Time. Rights Certificates will also be issued in respect of Voting Share and Variable Voting Share issued prior to the Expiration Time, to each holder (other than an Acquiring Person) converting, after the Separation Time, securities
(Convertible Securities) convertible into or exchangeable for Voting Shares or Variable Voting Shares. The Rights will trade separately from the Voting Shares and Variable Voting Shares, as the case may be, after the Separation
Time.



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Separation Time

The Separation Time is the close of business on the tenth Business Day after the earlier of (i) the Share Acquisition Date, which is
generally the first date of public announcement of facts indicating that a Person has become an Acquiring Person; and (ii) the date of the commencement of, or first public announcement of the intent of any Person (other than Postmedia or any
Subsidiary of Postmedia) to commence a Take-over Bid (other than a Permitted Bid or a Competing Permitted Bid, so long as such bid continues to satisfy the requirements of a Permitted Bid or Competing Permitted Bid). In either case, the Separation
Time can be such later date as may be determined by the Board acting in good faith. If a Take-over Bid expires, is cancelled, terminated or otherwise withdrawn prior to the Separation Time, it will be deemed never to have been made.

Acquiring Person

In general, an
Acquiring Person is a Person who is the Beneficial Owner of 20% or more of the outstanding Voting Shares or Variable Voting Shares. Excluded from the definition of Acquiring Person are Postmedia and its
Subsidiaries, and any Person who becomes the Beneficial Owner of 20% or more of the outstanding Voting Shares or Variable Voting Shares as a result of one or more or any combination of an acquisition or redemption by Postmedia of Shares, a Permitted
Bid Acquisition, an Exempt Acquisition, a Convertible Security Acquisition and a Pro Rata Acquisition.

The definitions of
Permitted Bid Acquisition, Exempt Acquisition, Convertible Security Acquisition and Pro Rata Acquisition are set out in the Postmedia Rights Plan. However, in general:



| | (a) | a Permitted Bid Acquisition means an acquisition of Voting Shares or Variable Voting Shares made pursuant to a Permitted Bid or
a Competing Permitted Bid;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | a Share Reduction means an acquisition or redemption by Postmedia or a Subsidiary of Postmedia of Voting Shares or Variable
Voting Shares or the automatic or optional conversion of Variable Voting Shares into Voting Shares or vice versa (other than, for greater certainty, the automatic or optional conversion of shares Beneficially Owned by such Person) pursuant to the
Corporations Constating Documents and the share provisions contained therein that, by reducing the number of Voting Shares or Variable Voting Shares outstanding, increases the percentage of outstanding Voting Shares or Variable Voting Shares
Beneficially Owned by such Person to 20% or more of the Voting Shares or Variable Voting Shares, as the case may be, then outstanding;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | an Exempt Acquisition means a Voting Share or Variable Voting Share acquisition: (A) in respect of which the Board has
waived the application of the Postmedia Rights Plan pursuant to certain provisions of the Postmedia Rights Plan; (B) pursuant to a dividend reinvestment plan of Postmedia; (C) pursuant to the receipt or exercise of rights issued by
Postmedia to all holders of Voting Shares or Variable Voting Shares (other than holders resident in a jurisdiction where such dividend is restricted or impracticable as a result of applicable law) to subscribe for or purchase Voting Shares, Variable
Voting Shares or Convertible Securities, provided that such rights are acquired directly from Postmedia and not from any other person and provided that the Person does not thereby acquire a greater percentage of Voting Shares, Variable Voting Shares
or Convertible Securities so offered than the Persons percentage of Voting Shares, Variable Voting Shares or Convertible Securities beneficially owned immediately prior to such acquisition; (D) pursuant to a distribution by Postmedia of
Voting Shares, Variable Voting Shares or Convertible Securities by way of prospectus or private placement by Postmedia, provided that the Person does not thereby acquire (or is deemed to Beneficially Own) a greater percentage of Voting Shares or
Variable Voting Shares so offered than the Persons percentage of Voting Shares or Variable Voting Shares Beneficially Owned immediately prior to such acquisition; or (E) pursuant to the exercise of awards granted under a deferred share
unit plan of Postmedia, options granted under a share option plan of Postmedia or rights to purchase securities granted under a share purchase plan of Postmedia;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | (d) | a Pro Rata Acquisition means an acquisition of Voting Shares, Variable Voting Shares or Convertible Securities: (i) as a
result of a stock dividend, a stock split or other event pursuant to which such Person receives or acquires Voting Shares, Variable Voting Shares or Convertible Securities on the same pro rata basis as all other holders of securities of the same
class or series of Postmedia; (ii) pursuant to a regular dividend reinvestment or other plan of Postmedia made available by Postmedia to all holders of Voting Shares and Variable Voting Shares (other than holders resident in any jurisdiction
where participation in any such plan is restricted or impractical as a result of applicable law), where such plan permits the holder to direct that the dividends paid in respect of such Voting Shares and Variable Voting Shares be applied to the
purchase from Postmedia of Voting Shares, Variable Voting Shares or Convertible Securities; or (iii) pursuant to the receipt and/or exercise of rights (other than the Postmedia Rights) issued by Postmedia to all of the holders of a series or
class of Voting Shares and Variable Voting Shares (other than holders resident in any jurisdiction where participation in any such plan is restricted or impractical as a result of applicable law) on a pro rata basis to subscribe for or purchase
Voting Shares, Variable Voting Shares or Convertible Securities, provided, however, that such Person does not thereby acquire a greater percentage of Voting Shares or Variable Voting Shares, as applicable, than the percentage of Voting Shares or
Variable Voting Shares Beneficially Owned by that Person immediately prior to such acquisition;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | a Convertible Security Acquisition means an acquisition of Voting Shares or Variable Voting Shares upon the exercise, conversion
or exchange of Convertible Securities received by such Person pursuant to a Permitted Bid Acquisition, Exempt Acquisition or a Pro Rata Acquisition; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (f) | a Grandfathered Person means a Person who is the Beneficial Owner of 20% or more of the outstanding Voting Shares or Variable
Voting Shares determined as at the Record Time, provided, however, that this exception shall not be, and shall cease to be, applicable to a Grandfathered Person in the event that such Grandfathered Person shall, after the Record Time, become the
Beneficial Owner of any additional Voting Shares or Variable Voting Shares, other than through one or any combination of a Permitted Bid Acquisition, an Exempt Acquisition, a Share Reduction, a Pro Rata Acquisition or a Convertible Security
Acquisition.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Also excluded from the definition of Acquiring Person is an underwriter or member of a
banking or selling group that becomes the Beneficial Owner of 20% or more of Voting Shares or Variable Voting Shares in connection with a distribution of securities by way of prospectus or private placement.

Beneficial Ownership

In general, a
Person is deemed to Beneficially Own Voting Shares or Variable Voting Shares actually held by others in circumstances where those holdings are or should be grouped together for purposes of the Postmedia Rights Plan. Included are holdings by the
Persons Affiliates (generally, a person that controls, is controlled by, or is under common control with another person) and Associates (generally, relatives sharing the same residence). Also included are securities which the Person or any of
the Persons Affiliates or Associates has the right to acquire within 60 days (other than (i) customary agreements with and between underwriters and/or banking group and/or selling group members with respect to a public offering or private
placement of securities; or (ii) pursuant to a pledge of securities in the ordinary course of the pledgees business), including Voting Shares into which Variable Voting Shares held by a citizen or subject of Canada are convertible
pursuant to the Corporations Constating Documents and the share provisions contained therein; provided, however, that a Non-Canadian who holds Variable Voting Shares will not be deemed to be the Beneficial Owner of, have
Beneficial Ownership of or Beneficially Own any Voting Shares into which the Variable Voting Shares owned by such Person are convertible.



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A Person is also deemed to Beneficially Own any securities that are
Beneficially Owned (as described in Beneficial Ownership) by any other Person with which the Person is acting jointly or in concert (a Joint Actor). A Person is a Joint Actor with any Person who is a party to
any agreement, arrangement or understanding with the first Person or an Associate or Affiliate thereof for the purpose of acquiring or offering to acquire Shares.

Institutional Shareholder Exemptions from Beneficial Ownership

The definition of Beneficial Ownership contains several exclusions whereby a Person is not considered to
Beneficially Own a security. There are exemptions from the deemed Beneficial Ownership provisions for institutional investors acting in the ordinary course of business. These exemptions apply to: (i) an
investment manager (Investment Manager) which holds securities in the ordinary course of business in the performance of its duties for the account of any other Person (a Client), including the acquisition or
holding of securities for non-discretionary accounts held on behalf of a Client by a broker or dealer registered under applicable securities law, provided, however, that for greater certainty, Investment Manager does not include a hedge fund, a
private equity fund or similar fund or entity or any Person who manages any of the foregoing; (ii) a licensed trust company (Trust Company) acting as trustee or administrator or in a similar capacity in relation to the
estates of deceased or incompetent persons (each an Estate Account) or in relation to other accounts (each an Other Account) and which holds such security in the ordinary course of its duties for such accounts;
(iii) the administrator or the trustee (a Plan Trustee) of one or more pension funds or plans (a Pension Fund or Plan) registered under applicable law; (iv) a Person who is a Pension Fund or Plan or is
a Person established by statute (the Statutory Body), and its ordinary business or activity includes the management of investment funds for employee benefit plans, pension plans, insurance plans or various public bodies; or
(v) a Crown agent or agency. The foregoing exemptions only apply so long as the Investment Manager, the Trust Company, the Plan Trustee, the Pension Fund or Plan, the Statutory Body or the Crown agent or agency is not then making or has not
then announced an intention to make a Take-over Bid alone or acting jointly or in concert with any other Person, other than an Offer to Acquire Voting Shares or Variable Voting Shares or other securities pursuant to a distribution by Postmedia or by
means of ordinary market transactions.

A Person will not be deemed to Beneficially Own a security because (i) the
Person is a Client of the same Investment Manager, an Estate Account or an Other Account of the same Trust Company, or Pension Fund or Plan with the same Plan Trustee as another Person or Pension Fund or Plan on whose account the Investment Manager,
Trust Company or Plan Trustee, as the case may be, holds such security; or (ii) the Person is a Client of an Investment Manager, Estate Account, Other Account or Pension Fund or Plan, and the security is owned at law or in equity by the
Investment Manager, Trust Company or Plan Trustee, as the case may be.

Flip-In Event

A Flip-In Event occurs when any Person becomes an Acquiring Person. In the event that, prior to the Expiration Time, a Flip-In Event which has
not been waived by the Board (whether before or after the occurrence of such Flip-In Event) occurs (see Waiver of Flip-In Events below), each Right (except for Rights Beneficially Owned or which may thereafter be Beneficially
Owned by an Acquiring Person or a transferee of such a Person, which Rights will become null and void) will constitute the right to purchase from Postmedia, upon exercise thereof in accordance with the terms of the Postmedia Rights Plan, that number
of Voting Shares or Variable Voting Shares, as applicable, having an aggregate Market Price on the date of the Flip-In Event equal to ten times the Exercise Price, for the Exercise Price (such Right being subject to anti-dilution adjustments).



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Permitted Bid and Competing Permitted Bid

A Permitted Bid is a Take-over Bid made by way of a Take-over Bid circular and which complies with the following additional provisions:



| | (a) | the Take-over Bid is made for all of the Voting Shares and Variable Voting Shares and is made to all holders of record of Voting Shares and
Variable Voting Shares, other than the Offeror, its Affiliates, Associates and Joint Actors;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | the Take-over Bid contains irrevocable and unqualified conditions that:
| | --- | -----------------------------------------------------------------------



| | A. | no security will be taken up or paid for pursuant to the Take-over Bid prior to the close of business on a date which is not less than 60 days
following the date of the Take-over Bid and the provisions for the take-up and payment for Voting Shares and Variable Voting Shares tendered or deposited thereunder will be subject to such irrevocable and unqualified condition;
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | B. | unless the Take-over Bid is withdrawn, securities may be deposited pursuant to the Take-over Bid at any time prior to the close of business on the
date of first take-up or payment for securities and securities deposited pursuant to the Take-over Bid may be withdrawn at any time prior to the close of business on such date;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | C. | not less than 50% of each of the outstanding Voting Shares and Variable Voting Shares held by Independent Shareholders must be deposited to the
Take-over Bid and not withdrawn at the close of business on the date of first take-up or payment for securities; and
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | D. | in the event that not less than 50% of each of the outstanding Voting Shares and Variable Voting Shares held by Independent Shareholders have been
deposited to the Take-over Bid and not withdrawn as at the date of first take-up or payment for securities under the Take-over Bid, the Offeror will make a public announcement of that fact and the Take-over Bid will remain open for deposits and
tenders of securities for not less than ten Business Days from the date of such public announcement.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

A Competing
Permitted Bid is a Take-over Bid that is made after a Permitted Bid or another Competing Permitted Bid has been made but prior to its expiry, satisfies all the requirements of a Permitted Bid as described above, except that a Competing Permitted Bid
is not required to remain open for 60 days so long as it is open until the later of (i) the earliest date on which securities may be taken-up or paid for under any earlier Permitted Bid or Competing Permitted Bid that is in existence; and
(ii) 35 days (or such other minimum period of days as may be prescribed by applicable law in Ontario) after the date of the Take-over Bid constituting the Competing Permitted Bid.

Redemption and Termination of Rights



| | (a) | Redemption of Rights on Approval of Holders of Shares and Rights. The Board may, at any time prior to the occurrence of a Flip-In Event,
elect to redeem all but not less than all of the outstanding Rights at a redemption price of $0.000001 per Right, appropriately adjusted for anti-dilution as provided in the Postmedia Rights Plan (the Redemption Price).
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | Deemed Redemption. Where a Person acquires, pursuant to a Permitted Bid or a Competing Permitted Bid, outstanding Voting Shares or
Convertible Securities, the Board shall be deemed to have elected to redeem the Rights at the Redemption Price.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | (c) | Redemption of Rights on Withdrawal or Termination of Bid. Where a Take-over Bid that is not a Permitted Bid or a Competing Permitted Bid
expires, is terminated or is otherwise withdrawn after the Separation Time and prior to the occurrence of a Flip-In Event, the Board may elect to redeem all of the outstanding Rights at the Redemption Price. In such event, all the provisions of the
Postmedia Rights Plan shall continue to apply as if the Separation Time had not occurred and Rights Certificates representing the number of Rights held by each holder of record of Voting Shares and Variable Voting Shares as of the Separation Time
had not been mailed to each such holder and, for all purposes of the Postmedia Rights Plan, the Separation Time shall be deemed not to have occurred and Rights shall remain attached to the outstanding Voting Shares and Variable Voting Shares.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If the Board is deemed to have elected or elects to redeem the Rights as described above, the right to exercise the
Rights will thereupon, without further action and without notice, terminate and the only right thereafter of the holders of Rights will be to receive the Redemption Price. Within ten Business Days of any such election or deemed election to redeem
the Rights, Postmedia will notify the holders of the Shares or, after the Separation Time, the holders of the Rights.

Waiver of Flip-In Events

The Board may waive the application of the events that occur under a Flip-In Event (see Shareholder Rights Plan 
Flip-In Event above) to any Flip-In Event by written notice delivered to the Rights Agent and in the event of such waiver, the Flip-In Event shall be deemed never to have occurred and, if such waiver is provided after the Separation Time,
all the provisions of Postmedia Rights Plan shall continue to apply as if the Separation Time had not occurred and Rights Certificates representing the number of Rights held by each holder of record of Voting Shares and Variable Voting Shares as of
the Separation Time had not been mailed to each such holder, and the Separation Time shall be deemed not to have occurred and Rights shall remain attached to the outstanding Voting Shares and Variable Voting Shares.

Anti-Dilution Adjustments

The Exercise
Price of a Right, the number and kind of securities subject to purchase upon exercise of a Right, and the number of Rights outstanding, will be adjusted in certain events, including, without limitation:



| | (i) | if there is: (A) a declaration of a dividend on its Voting Shares or Variable Voting Shares payable in Voting Shares or Variable Voting Shares
(or Convertible Securities) other than pursuant to any mandatory or optional share dividend reinvestment program, (B) a subdivision or change of the then outstanding Voting Shares or Variable Voting Shares into a greater number of shares,
(C) a combination or change of the then outstanding Voting Shares or Variable Voting Shares into a smaller number of shares, or (D) an issuance of Voting Shares or Variable Voting Shares (or Convertible Securities) in lieu of or in
exchange for existing shares; or
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | if Postmedia fixes a record date for a distribution to all holders of Voting Shares and Variable Voting Shares of certain rights or warrants to
acquire Voting Shares or Variable Voting Shares or Convertible Securities, or for the making of a distribution to all holders of Voting Shares or Variable Voting Shares of evidences of indebtedness or assets (other than regular periodic cash
dividends or a distribution payable in Voting Shares or Variable Voting Shares, but including any distribution payable in securities other than Voting Shares or Variable Voting Shares).
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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Supplements and Amendments

Postmedia may at any time, amend, supplement, vary or delete any of the provision of the Postmedia Rights Plan.

Any such amendment, supplement, variation or deletion shall be effective from the date of the resolution of the Board adopting such amendment,
supplement, variation or deletion or such earlier or later date as the Board may otherwise determine. The implementation of any such amendment, supplement, variation or deletion will be subject to receipt of any necessary regulatory approval
including that of any securities regulatory authority or stock exchange.



|C. | Material Contracts
|-- | ------------------

First-Lien Notes Indenture

On
August 16, 2012, Postmedia Network Inc. issued $250.0 million in aggregate principal amount of First-Lien Notes. The First-Lien Notes were issued under an indenture dated as of August 16, 2012 with Computershare Trust Company of Canada, as
trustee and as collateral agent and the Corporation, as guarantor. The Corporation financed the Sun Acquisition in part through the issuance of the Notes Subscription Receipts resulting in gross proceeds of $140.0 million, which were exchanged for
additional First-Lien Notes on April 13, 2015 for $139.3 million principal amount of First-Lien Notes. Amendments to the existing First-Lien Notes indenture were required to facilitate the issuance of the additional First-Lien Notes pursuant to
the first, second and third supplemental indentures (dated October 31, 2014, April 13, 2015 and April 13, 2015, respectively) among the Corporation, Postmedia Network Inc. and Computershare Trust Company of Canada. The First-Lien
Notes are secured on a first-priority basis by the First-Lien Notes Collateral and on a second-priority basis by the ABL Collateral. The First-Lien Notes indenture contains covenants that, among other things, restrict the issuers ability to
incur additional indebtedness, pay dividends or make other distributions or repurchase or redeem certain indebtedness or capital stock, make loans and investments, sell assets, incur certain liens, enter into certain transactions with affiliates,
alter the businesses it conducts, enter into agreements restricting its subsidiaries ability to pay dividends and consolidate, merge or sell all or substantially all of its assets.

Second-Lien Notes Indenture

On
July 13, 2010, Postmedia Network Inc. issued US$275 million in aggregate principal amount of Second-Lien Notes. The Second-Lien Notes were issued under an indenture dated as of July 13, 2010 with The Bank of New York Mellon, as trustee,
the Corporation, as guarantor, and BNY Trust Company of Canada, as collateral agent. The Second-Lien Notes are secured on a second-priority basis by the First-Lien Notes Collateral and on a third-priority basis by the ABL Collateral. The covenants
contained in the Second-Lien Notes indenture are substantially similar to the covenants contained in the First-Lien Notes indenture described above. Amendments to the existing Second-Lien Notes indenture were required to add additional guarantors
pursuant to the first and second supplemental note indentures (dated as of July 13, 2010 and April 13, 2015, respectively) among the Corporation, Postmedia Network Inc. and Bank of New York Mellon.



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ABL Facility

On July 13, 2010, Postmedia entered into a four-year senior secured asset-based revolving credit facility for an aggregate amount of up to
$60 million, including a $10 million letter of credit sub-facility which matured on July 13, 2014. On October 16, 2014, the Corporation entered into a one-year senior secured asset-based revolving credit facility for an aggregate amount of
up to $20 million pursuant to the terms and conditions of a revolving credit agreement among Postmedia Network Inc., as borrower, the Corporation, as guarantor, The Bank of Nova Scotia, as administrative agent, collateral agent, lead arranger, joint
bookrunner and lender, Royal Bank of Canada, as joint bookrunner and lender, and the other lenders party thereto from time to time. The ABL Facility had a term of one year and matured October 16, 2015 and was not replaced. The ABL Facility was
secured on a third-priority basis by the First-Lien Notes Collateral and on a first-priority basis by the ABL Collateral. Any replacement facility to the ABL Facility entered into in the future would have the same collateral priorities as a result
of intercreditor agreements in place for the First-Lien Notes and Second Lien Notes.

The Registration Rights Agreement

On July 13, 2010, Postmedia entered into a registration rights agreement with GoldenTree. Under the agreement, GoldenTree was granted
demand registration rights pursuant to which GoldenTree may require Postmedia to file a prospectus with the Canadian securities administrators qualifying the Shares owned by GoldenTree for sale in Canada. The agreement also grants piggyback
registration rights to GoldenTree in the event that Postmedia proposes to distribute Shares by way of a prospectus, which rights allow GoldenTree to require Postmedia in certain circumstances to include Shares owned by GoldenTree in such prospectus
distribution.

Standby Purchase Agreement

In connection with the Sun Acquisition, on October 6, 2014, Postmedia entered into a Standby Purchase Agreement with GoldenTree, pursuant
to which GoldenTree agreed to take up any subscription receipts not otherwise subscribed for under the Rights Offering, subject to the satisfaction of certain conditions. Based on the results of the Rights Offering, GoldenTree did not own Shares
carrying 331⁄3% or more of the outstanding voting rights respect of all of the issued and outstanding Shares of the Company, and therefore, in accordance with
the Standby Purchase Agreement, GoldenTree was not required to enter into a voting restriction agreement to limit the number of votes that they would be entitled to cast at any meeting of Shareholders.

The Nominating Agreement

Please refer to
Item 6.A Directors and Senior Management  Nominating Agreement.



|D. | Exchange Controls.
|-- | ------------------

There are no governmental laws, decrees or regulations in Canada relating to restrictions on the export or import of capital, or affecting the
remittance of interest, dividends or other payments to non-resident holders of the Corporations common shares other than withholding tax requirements. (E.g., Remittances of dividends to United States residents are generally subject to a 15%
withholding tax (5% if the Shareholder is a company beneficially owning at least 10% of the common shares of the Corporation) pursuant to Article X of the reciprocal treaty between Canada and the United States.

As described in greater detail in Item 10.B, the Voting Shares may only be beneficially owned and controlled, directly or indirectly, by
persons that are not Non-Canadian. Except for the restrictions on ownership described in Item 10.B Memorandum and Articles of Association and except as provided in the Investment Canada Act (the ICA), there are
no provisions under the laws of Canada or in the Articles of the Corporation restricting the right of foreigners to hold or vote the common shares of the Corporation.



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Under the ICA, certain transactions involving the acquisition of control of a Canadian business
by a non-Canadian that exceed prescribed monetary thresholds are subject to review and cannot be implemented unless the applicable Minister responsible for the ICA is satisfied that the acquisition is likely to be of net benefit to Canada. The
Minister of Canadian Heritage (for cultural businesses) and the Minister of Industry (for all other activities) are the two Ministers who are responsible for reviewing transactions. Where a transaction is subject to the review requirement (a
Reviewable Transaction), an application for review must be filed with the applicable Director of Investments appointed by the responsible Minister prior to the implementation of the Reviewable Transaction. The responsible Minister
is then required to determine whether the Reviewable Transaction is likely to be of net benefit to Canada, taking into account the application for review, any written undertakings from the investor and the prescribed factors of assessment set out in
the ICA.

The monetary threshold for the review of Canadian businesses carrying on a cultural business within the
meaning of the ICA is $5 million. The Corporation carries on a cultural business within the meaning of the ICA. An acquisition of control of the Corporation by a non-Canadian would be a Reviewable Transaction if the value of
the assets of the Corporation equalled or exceeded $5 million. The transaction would also be a Reviewable Transaction even if the Corporations assets were less than $5 million if the Governor in Council (the Canadian federal cabinet)
elected to review the transaction. In this latter case, the transaction could be implemented prior to such determination.

The ICA sets
out rules to determine, inter alia, who is a non-Canadian and whether there has been an acquisition of control of a Canadian business. Notwithstanding these rules, under the ICA, where a transaction involves a Canadian business which carries on a
cultural business, the Minister of Canadian Heritage has discretion to make a determination that an investor which may qualify as a Canadian under the rules is in fact a non-Canadian and that there has been in fact an acquisition
of control of the Canadian business notwithstanding that there may not have been an acquisition of control under the other provisions of the ICA.



|E. | Taxation.
|-- | ---------

Material
Canadian Federal Income Tax Consequences for United States Residents

The following summarizes the material Canadian federal income tax
consequences generally applicable to the holding and disposition of our shares by a holder (in this summary, a U.S. holder), who, (a) for the purposes of the Income Tax Act (Canada) (the Tax Act), and at
all relevant times, is not resident in Canada, deals at arms length with us, is not affiliated with us, holds our shares as capital property and does not use or hold and is not deemed to use or hold our shares in the course of carrying on, or
otherwise in connection with, a business in Canada, and (b) for the purposes of the Canada-United States Income Tax Convention, 1980 (the Treaty), and at all relevant times, is a resident of the U.S. and is a
qualifying person for purposes of the Treaty. This summary does not apply to traders or dealers in securities, limited liability companies, tax-exempt entities, insurers, financial institutions (including those to which the
mark-to-market provisions of the Tax Act apply), or any other holder in special circumstances. This summary is based on the current provisions of the Tax Act including all regulations thereunder, the Treaty, all proposed amendments to the Tax Act,
the regulations and the Treaty publicly announced by the Government of Canada to the date hereof, and our understanding of the current administrative practices and assessing policies of the Canada Revenue Agency. It has been assumed that all
currently proposed amendments will be enacted as proposed and that there will be no other relevant change in any governing law or administrative practice, although no assurances can be given in these respects. The summary does not take into account
Canadian provincial, U.S. federal, state or other foreign income tax law or practice. The tax consequences to any particular U.S. holder will vary according to the status of that holder as an individual, trust, corporation, partnership or other
entity, the jurisdictions in which that holder is subject to taxation, and generally according to that holders particular circumstances. Accordingly, this summary is not, and is not to be construed as, Canadian tax advice to any particular
U.S. holder. All U.S. holders are advised to consult with their own tax advisors regarding their particular circumstances. The discussion below is qualified accordingly.



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Dividends

Dividends paid or credited, or deemed to be paid or credited, to a U.S. holder by us will be subject to Canadian withholding tax under the Tax
Act at the rate of 25% of the gross amount of the dividends, unless reduced under an applicable tax treaty. Under the Treaty, the rate of withholding tax on dividends paid to a U.S. holder that is the beneficial owner of such dividends is generally
limited to 15% of the gross amount of the dividends (or 5% if the U.S. holder is a company which beneficially owns at least 10% of our voting shares). We will be required to withhold the applicable withholding tax from any dividend and remit it to
the Canadian government for the U.S. holders account.

Disposition

For purposes of the following discussion, we have assumed that our shares will remain listed on the TSX. A U.S. holder is not subject to tax
under the Tax Act in respect of a capital gain realized on the disposition of our shares in the open market unless the shares constitute taxable Canadian property to the holder thereof and the U.S. holder is not entitled to relief
under the Treaty. Our shares will constitute taxable Canadian property to a U.S. holder if, at any time during the 60 month period preceding the disposition, the U.S. holder, persons with whom the U.S. holder did not deal at arms length or a
partnership in which the U.S. holder or a non-arms length person holds a membership interest directly or indirectly through one or more partnerships, alone or together, owned 25% or more of the issued shares of any class or series of our
capital stock, and more than 50% of the fair market value of our shares was derived, directly or indirectly, from any one or a combination of (i) real or immovable property situated in Canada, (ii) Canadian resource properties,
(iii) timber resource properties, and (iv) options in respect of, or interests in, or for civil rights law rights in, property described in any of (i) to (iii), whether or not that property exists. Notwithstanding the foregoing, in
other specific circumstances, including where shares were acquired for other securities in a tax-deferred transaction, our shares could be deemed to be taxable Canadian property.

If our shares constitute taxable Canadian property to the U.S. holder, the U.S. holder will (unless relieved under the Treaty) be subject to
Canadian income tax on any gain realized. The taxpayers capital gain (or loss) from a disposition of the shares is the amount, if any, by which the proceeds of disposition exceed (or are exceeded by) the aggregate of the adjusted cost base of
the shares and reasonable expenses of disposition. One-half of the capital gain is included in income. Under the Treaty, the U.S. holder will generally be exempt from Canadian tax on any capital gain realized on a disposition of our shares provided
that, at the time of the disposition, the shares do not derive their value principally from real property situated in Canada.



|F. | Dividends and Paying Agents.
|-- | ----------------------------

Not applicable.



|G. | Statements by Experts.
|-- | ----------------------

Not applicable.



|H. | Documents on Display.
|-- | ---------------------

We filed a registration statement on Form F-4 with the SEC in Washington, D.C. (Registration No. 333-174780) on June 8, 2011, which
became effective on June 13, 2011. The Registration Statement contains exhibits and schedules. Material contracts and publicly available corporate records may be viewed at our registered and records office located at 365 Bloor Street East, 12th
Floor, Toronto, Ontario Canada.

The Corporation files annual reports and furnishes other information with the SEC. You may read and copy
any document that we file at the SECs Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549 or by accessing the Commissions website (http://www.sec.gov). The Corporation also files its annual reports and other information
with the Canadian Securities Administrators via SEDAR (www.sedar.com).



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|I. | Subsidiary Information.
|-- | -----------------------

We hold a 100% interest in our subsidiary, Postmedia Network Inc., a company incorporated under the laws of Canada.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Please refer to Financial Instruments and Financial Instruments Risk Management in the MD&A, attached hereto as
Exhibit 15.2.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES



|A. | Debt Securities.
|-- | ----------------

Not applicable.



|B. | Warrants and Rights.
|-- | --------------------

Not applicable.



|C. | Other Securities.
|-- | -----------------

Not applicable.



|D. | American Depository Shares.
|-- | ---------------------------

Not applicable.

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable.

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Not applicable.

ITEM 15. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As
required by Rule 15d-15 under the U.S. Securities Exchange Act of 1934, or the Exchange Act, management has evaluated, with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls
and procedures as of the end of the period covered by this report. Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the
Exchange Act are recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that
information required to be disclosed by us in our reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely
decisions regarding our required disclosure. Based on the foregoing evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of August 31, 2015, the end of the period covered by this report, our disclosure
controls and procedures were effective at a reasonable assurance level.



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Managements Annual Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting.

Internal controls over financial reporting have been designed by management, under the supervision of and with the participation of the
Corporations Chief Executive Officer and Chief Financial Officer, to provide reasonable assurance regarding the reliability of the Corporations financial reporting and the preparation of financial statements for external purposes in
accordance with IFRS. Our internal control over financial reporting includes those policies and procedures that:



| |  |  | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
applicable IFRS, and that receipts and expenditures are being made only in accordance with authorizations of management and the Board; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have
a material effect on the financial statements.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

To evaluate the effectiveness of the Corporations internal control
over financial reporting, management has used the Internal Control - Integrated Framework (2013), which is a suitable, recognized control framework established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Management has assessed the effectiveness of the Corporations internal control over financial reporting and concluded that such internal control over financial reporting is effective as of August 31, 2015. On April 13, 2015, the
Corporation completed the Sun Acquisition as described in Item 4.A History and Development of the Company - Significant Post-Acquisition Events. Registrants are permitted to exclude acquisitions from their assessment of internal
control over financial reporting during the first year if, among other circumstances and factors, there is not adequate time between the consummation date of the acquisition and the assessment date for internal controls. On that basis, management
excluded from its assessment the internal control over financial reporting for the properties acquired in the Sun Acquisition whose total assets and revenues represent 45.9% and 20.9% of the Corporations consolidated total assets and revenues,
respectively, for the year ended August 31, 2015.

Limitations on the Effectiveness of Controls

The Corporations management, including the Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure
controls or our internal controls will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the
design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if any, within the Corporation have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can
occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is
based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, control may become inadequate
because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
However, these inherent limitations are known features of the financial reporting process, and it is possible to design safeguards into the process to reduce, though not eliminate, this risk.



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Attestation Report of the Registered Accounting Firm

This annual report does not include an attestation report of our independent auditors regarding internal control over financial reporting.
Managements report was not subject to attestation by our independent auditors pursuant to the rules of the SEC that permit us to provide only managements report in this annual report.

Changes in Internal Control over Financial Reporting

During the fiscal year ended August 31, 2015, there were no changes in the Corporations internal control over financial reporting
that have materially affected, or are reasonably likely to materially affect, the Corporations internal control over financial reporting.

ITEM 15T. CONTROLS AND PROCEDURES

Not applicable.

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

Postmedias Board has determined that it has at least one audit committee
financial expert serving on its Audit Committee. Each of Mr. Steacy, Ms. Burke, Ms. Peverett and Mr. Savage has been determined to by the Board to be an audit committee financial expert. Each of Mr. Steacy, Ms. Burke,
Ms. Peverett and Mr. Savage are independent under Canadian securities law.

Under SEC rules, the designation
of persons as audit committee financial experts does not make them experts for any other purpose, impose any duties, obligations or liability on them that are greater than those imposed on members of their committee and the Board
who do not carry this designation or affect the duties, obligations or liability of any other member of their committee.

ITEM 16B. CODE OF ETHICS

Postmedia has adopted a Code of Business Conduct and Ethics which applies to all directors,
officers and employees of our Company, its subsidiaries and affiliates and other persons in similar relationships with those entities. The Code of Business Conduct and Ethics is provided to all directors, officers and employees and is further
available on SEDAR at www.sedar.com and on EDGAR. The Code of Business Conduct and Ethics addresses such matters as compliance with laws, conflicts of interest, confidential information, fraud protection and proper use of Postmedia assets and
the reporting of illegal and unethical behaviour. We have posted our Code of Business Conduct and Ethics on our website www.postmedia.com. We hereby undertake to provide to any person without charge, a copy of our Code of Business Conduct and Ethics
within ten working days after we receive such persons written request.

We encourage personnel who become aware of a conflict or
potential conflict or departures from the Code of Business Conduct and Ethics to bring it to the attention of a supervisor or department head and require personnel who detect or suspect a fraud has occurred to report the incident immediately. We
have also established additional procedures for confidential and anonymous reporting of complaints concerning accounting, internal accounting controls, auditing matters and breaches of the Code of Business Conduct and Ethics. The Board requires
every director and executive officer to disclose any direct or indirect conflict of interest that he or she has, and obtains formal confirmation of compliance with the Code of Business Conduct and Ethics annually from directors, officers and a group
of senior managers from across the Corporation.

Any waivers of the Code of Business Conduct and Ethics for directors or members of senior
management may only be granted by the Board (or a Committee to whom that authority has been delegated), while any waiver for all other employees may only be made by the President and CEO.



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In order to help ensure that directors exercise independent judgement in considering any
transaction or agreement in which a director or executive officer has a material interest, any director or executive officer with such an interest is expected to declare the interest and would generally not be present for any discussion or vote
regarding the matter.

The Code of Business Conduct and Ethics was filed as exhibit 99.2 to the Corporations form 6-K, filed with
the SEC on October 25, 2013 and is attached hereto as Exhibit 1.3.1.

ITEM 16C. PRINCIPAL
ACCOUNTANT FEES AND SERVICES

The following table summarizes the fees billed by the Corporations external auditors for Fiscal
2015 and Fiscal 2014 for audit and non-audit related services provided to the Corporation and its subsidiaries:



|            |  |                |  |                       |  |                       |  |                  
|----------- |  | -------------- |  | --------------------- |  | --------------------- |  | -----------------
|YEAR        |  | AUDIT FEES ($) |  | AUDIT RELATEDFEES ($) |  | TAXCOMPLIANCEFEES ($) |  | ALL OTHER FEES($)
|Fiscal 2015 |  | 726,000(1)     |  | 68,800(2)             |  | 26,250                |  | 266,050(3)       
|Fiscal 2014 |  | 575,000        |  | 74,500(2)             |  | 7,500                 |  | 524,000(4)       



Notes:



|(1) | The increase in audit fees relates to the additional work required as a result of the properties acquired as part of the Sun Acquisition.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes fees incurred in connection with the audit of the Pension Plan financial statements, fees incurred with respect to specified procedures on
internal controls and Canadian Public Accountability Board fees.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Includes fees incurred in connection with the due diligence related to the Sun Acquisition, the Rights Offering and related translation services.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Includes fees incurred in connection with the due diligence related to the Sun Acquisition.
|--- | -------------------------------------------------------------------------------------------

There were no other fees billed by the Corporations external auditors for Fiscal 2015 and Fiscal 2014 that do not fit into the
categories presented in the table above. All of the services provided by the Corporations external auditors in Fiscal 2015 were approved by the Audit Committee.

For information regarding the Corporations policy of Audit Committee pre-approval of audit and non-audit services, please refer to
Item 6.C Board Practices  Details relating to the Corporations Audit Committee.

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Not applicable.

ITEM 16F. CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT

Not applicable.

ITEM 16G. CORPORATE GOVERNANCE

Not applicable.

ITEM 16H. MINE SAFETY DISCLOSURE

Not applicable.



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PART III

ITEM 17. FINANCIAL STATEMENTS

Not applicable.

ITEM 18. FINANCIAL STATEMENTS

The Corporations consolidated financial statements are stated in Canadian dollars and
are prepared in accordance with IFRS as issued by the IASB.

The financial statements and notes thereto as required in Item 18 are
attached as Exhibit 15.1 to this annual report and are incorporated by reference herein.

ITEM 19.
EXHIBITS

The following items are specifically incorporated by reference in, and form an integral part of, this filing on
Form 20-F.



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                               
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description of Exhibit                                                                                                                                                                                                                                                                                                                                                                                                        
|            | 
|1.1.1      |  | (i) Certificate and Articles of Amalgamation of Postmedia Network Inc. dated April 13, 2015.                                                                                                                                                                                                                                                                                                                                  
|            | 
|1.1.2       |  | (ii) By-laws of Postmedia Network Inc., previously filed as Exhibit 2.1.2 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                                  
|            | 
|1.2.1       |  | (i) Certificate and Articles of Incorporation and Amendment of Postmedia Network Canada Corp., previously filed as Exhibit 2.2.1 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and
incorporated by reference herein.                                                                                                                                                                           
|            | 
|1.2.2       |  | (ii) By-laws of Postmedia Network Canada Corp., previously filed as Exhibit 2.2.2 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                          
|            | 
|1.3.1       |  | By-law No. 3 of the by-laws of Postmedia Network Canada Corp., previously filed as Exhibit 99.1 to the Registrants Form 6-K filed on October 25, 2013 and incorporated by reference herein.                                                                                                                                                                                                                                  
|            | 
|2.1         |  | Senior Secured Notes Indenture, dated as of July 13, 2010, relating to the 12.50% Senior Secured Notes due 2018, among Postmedia Network Inc., Postmedia Network Canada Corp., The Bank of New York Mellon as Trustee and BNY
Trust Company of Canada, as Collateral Agent, previously filed as Exhibit 4.1 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.
|            | 
|2.2         |  | Intercreditor Agreement, dated as of July 13, 2010, among Morgan Stanley Senior Funding, Inc., as ABL Collateral agent, JPMorgan Chase Bank, N.A., as term loan collateral agent and BNY Trust Company of Canada as notes
collateral agent, previously filed as Exhibit 4.4 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                



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|     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.3  |  | Intercreditor Agreement, dated as of July 13, 2010, among JPMorgan Chase Bank, N.A. as term loan collateral agent and BNY Trust Company of Canada, as
notes collateral agent, previously filed as Exhibit 4.5 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     | 
|2.4  |  | Pledge and Security Agreement, dated as of July 13, 2010, among Postmedia Network Inc., the grantors named thereto, The Bank of New York Mellon as trustee and BNY Trust Company of Canada as collateral agent, previously
filed as Exhibit 4.6 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                       
|     | 
|2.5  |  | Grant of Security Interest in Trademarks Rights, dated as of July 13, 2010 among Postmedia Network Inc. and BNY Trust Company of Canada as collateral agent, previously filed as Exhibit 4.7 to the Registrants
Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     | 
|2.6  |  | Shareholder Rights Plan Agreement, dated as of November 8, 2010, between Postmedia Network Canada Corp. and Computershare Investor Services Inc. as Rights Agent, previously filed as Exhibit 4.8 to the Registrants
Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     | 
|2.7  |  | Senior Secured Notes Indenture, dated as of August 16, 2012, among Postmedia Network Inc., as Issuer, Postmedia Network Canada Corp., as Guarantor, Computershare Trust Company of Canada, as Trustee and Computershare Trust
Company of Canada, as Collateral Agent, previously filed as Exhibit 4.1 to the Registrants Form 6-K filed on August 20, 2012 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                        
|     | 
|2.8  |  | First Supplemental Indenture, dated as of October 31, 2014, among Postmedia Network Canada Corp., Postmedia Network Inc. and Computershare Trust Company of Canada, as Trustee and Collateral Agent, previously filed as Exhibit 99.2 to
the Registrants Form 6-K filed on November 12, 2014 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | 
|2.9  |  | Second Supplemental Indenture, dated as of April 13, 2015, among Postmedia Network Canada Corp., Postmedia Network Inc. and Computershare Trust Company of Canada, as Trustee and Collateral Agent, previously filed as Exhibit 99.2 to
the Registrants Form 6-K filed on April 20, 2015 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     | 
|2.10 |  | Third Supplemental Indenture, dated as of April 13, 2015, among 1576626 Ontario Inc., 7731558 Canada Inc., Postmedia Network Canada Corp., Postmedia Network Inc. and Computershare Trust Company of Canada, as Trustee and Collateral
Agent, previously filed as Exhibit 99.3 to the Registrants Form 6-K filed on April 20, 2015 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                                                
|     | 
|2.11 |  | Second Supplemental Indenture, dated as of April 13, 2015, among 1576626 Ontario Inc., 7731558 Canada Inc., Postmedia Network Canada Corp., Postmedia Network Inc., the Bank of New York Mellon as Trustee and BNY Trust Company of
Canada as Collateral Agent, previously filed as Exhibit 99.1 to the Registrants Form 6-K filed on April 20, 2015 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                                                                                                              
|     | 
|4.1  |  | Revolving Credit Agreement, dated as of July 13, 2010, among Postmedia Network Inc., Postmedia Network Canada Corp., Morgan Stanley Senior Funding, Inc., as administrative agent, collateral agent, co-syndication agent, joint
collateral agent and paying agent, JPMorgan Chase Bank, N.A., as co-syndication agent, Wells Fargo Capital Finance Corporation Canada, as joint collateral agent and co-documentation agent, Royal Bank of Canada, as co-documentation agent, and the
lenders party thereto, with Morgan Stanley Senior Funding, Inc. and J.P. Morgan Securities Inc. as joint lead arrangers and joint bookrunners, previously filed as Exhibit 10.4 to the Registrants Registration Statement on Form F-4 filed on
June 8, 2011 and incorporated by reference herein.



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|     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.2  |  | Pledge and Security Agreement, dated as of July 13, 2010, among Postmedia Network Inc., the grantors party thereto and Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, previously filed as
Exhibit 10.5 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                  
|     | 
|4.3  |  | Grant of Security Interest in Trademark Rights, dated as of July 13, 2010, between Postmedia Network Inc. and Morgan Stanley Senior Funding, Inc., previously filed as Exhibit 10.6 to the Registrants Registration
Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                         
|     | 
|4.4  |  | Nominating Agreement, dated as of July 13, 2010, between Postmedia Network Canada Corp. and GoldenTree Asset Management LP., previously filed as Exhibit 10.9 to the Registrants Registration Statement on Form F-4
filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                               
|     | 
|4.5  |  | Registration Rights Agreement, dated as of July 13, 2010 between Postmedia Network Canada Corp. and GoldenTree Asset Management LP., previously filed as Exhibit 10.10 to the Registrants Registration Statement on Form
F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                      
|     | 
|4.6  |  | Agreement among Postmedia Network Inc., Sport Media Enterprises Inc. and Wayne Parrish, dated July 21, 2010, previously filed as Exhibit 10.12 to the Registrants Registration Statement on Form F-4 filed on
June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                              
|     | 
|4.7  |  | Asset Purchase Agreement, dated October 18, 2011, among Postmedia Network Inc., LMP Publication Limited Partnership and GVIC Communications Corp., previously filed as Exhibit 4.12 to the Registrants Annual Report on
Form 20-F filed on November 28, 2011 and incorporated by reference herein.                                                                                                                                                                                            
|     | 
|4.8  |  | Asset Purchase Agreement, dated October 18, 2011, among Postmedia Network Inc., TC Publication Limited Partnership and GVIC Communications Corp., previously filed as Exhibit 4.13 to the Registrants Annual Report on
Form 20-F filed on November 28, 2011 and incorporated by reference herein.                                                                                                                                                                                             
|     | 
|4.9  |  | First Amendment to Revolving Credit Agreement, dated as of August 8, 2012, among Postmedia Network Inc., Postmedia Network Canada Corp., Morgan Stanley Senior Funding, Inc., as administrative agent, collateral agent,
co-syndication agent, joint collateral agent and paying agent and the other lenders party thereto; previously filed as Exhibit 4.10 to the Registrants Annual Report on Form 20-F filed on November 23, 2012 and incorporated by
reference herein.                   
|     | 
|4.10 |  | Pledge and Security Agreement, dated as of August 16, 2012, among Postmedia Network Inc., Postmedia Network Canada Corp. and Computershare Trust Company of Canada, previously filed as Exhibit 4.2 to the Registrants Form
6-K filed on August 20, 2012 and incorporated by reference herein.                                                                                                                                                                                                
|     | 
|4.11 |  | Acknowledgement, Confirmation of and Accession to Intercreditor Agreement, dated as of August 16, 2012, among Morgan Stanley Senior Funding, Inc. as ABL Collateral Agent, Computershare Trust Company of Canada, as Term Loan
Collateral Agent, BNY Trust Company of Canada, as Notes Collateral Agent, Postmedia Network Inc. and Postmedia Network Canada Corp., previously filed as Exhibit 4.3 to the Registrants Form 6-K filed on August 20, 2012 and incorporated by
reference herein.
|     | 
|4.12 |  | Acknowledgement, Confirmation of and Accession to Intercreditor Agreement, dated as of August 16, 2012, among Computershare Trust Company of Canada, as Term Loan Collateral Agent, BNY Trust Company of Canada, as Notes
Collateral Agent, Postmedia Network Inc. and Postmedia Network Canada Corp., previously filed as Exhibit 4.4 to the Registrants Form 6-K filed on August 20, 2012 and incorporated by reference herein.                                                             
|     | 
|4.13 |  | Purchase Agreement, dated as of October 6, 2014, by and between Postmedia Network Inc. and Quebecor Media Inc., previously filed as Exhibit 2.1 to the Registrants Form 6-K filed on October 14, 2014 and
incorporated by reference herein.                                                                                                                                                                                                                                                   



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|      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.14  |  | Subscription Agreement, dated as of October 6, 2014, by and between Postmedia Network Inc. and Canso Investment Counsel Ltd., previously filed as Exhibit 10.1 to the Registrants Form 6-K filed on October 14,
2014 and incorporated by reference herein.                                                                                                                                                                                                                                 
|      | 
|4.15  |  | Subscription Receipt Indenture, dated as of October 6, 2014, by and between Postmedia Network Inc. and Computershare Trust Company of Canada, previously filed as Exhibit 10.2 to the Registrants Form 6-K filed on
October 14, 2014 and incorporated by reference herein.                                                                                                                                                                                                                 
|      | 
|4.16  |  | Standby Purchase Agreement, dated as of October 6, 2014, by and between Postmedia Network Canada Corp. and GoldenTree Asset Management LP, previously filed as Exhibit 10.3 to the Registrants Form 6-K filed on
October 14, 2014 and incorporated by reference herein.                                                                                                                                                                                                                    
|      | 
|4.17  |  | Revolving Credit Agreement, dated as of October 16, 2014, among Postmedia Network Inc., as borrower, Postmedia Network Canada Corp., as guarantor, The Bank of Nova Scotia, as administrative agent, collateral agent, lead arranger,
joint bookrunner and lender, Royal Bank of Canada, as joint bookrunner and lender, and the other lenders party thereto, previously filed as Exhibit 99.1 to the Registrants Form 6-K filed on November 12, 2014 and incorporated by reference
herein.
|      | 
|4.18  |  | Conversion Restriction Agreement, dated as of December 11, 2014, by and between Postmedia Network Canada Corp. and Canso Investment Counsel Limited, previously filed as Exhibit 99.1 to the Registrants Form 6-K filed on
December 15, 2014 and incorporated by reference herein.                                                                                                                                                                                                         
|      | 
|8.1   |  | Subsidiaries of the Registrants, previously filed as Exhibit 21.1 to the Registrants Registration Statement on Form F-4 filed on June 8, 2011 and incorporated by reference herein.                                                                                                                                                                                                                                                                                                        
|      | 
|9.1   |  | Code of Business Conduct and Ethics of Postmedia Network Canada Corp., previously filed as Exhibit 99.1 to the Registrants Form 6-K filed on October 22, 2015 and incorporated by reference herein.                                                                                                                                                                                                                                                                                        
|      | 
|12.1 |  | Certification pursuant to Title 18, United States code, Section 1350 as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (Paul Godfrey)                                                                                                                                                                                                                                                                                                                                    
|      | 
|12.2 |  | Certification pursuant to Title 18, United States code, Section 1350 as adopted pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (Douglas Lamb)                                                                                                                                                                                                                                                                                                                                    
|      | 
|13.1 |  | Certification pursuant to Title 18, United States code, Section 1350 as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (Paul Godfrey)                                                                                                                                                                                                                                                                                                                                    
|      | 
|13.2 |  | Certification pursuant to Title 18, United States code, Section 1350 as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (Douglas Lamb)                                                                                                                                                                                                                                                                                                                                    
|      | 
|15.1 |  | Consolidated financial statements of the registrant for the years ended August 31, 2015, 2014 and 2013.                                                                                                                                                                                                                                                                                                                                                                                     
|      | 
|15.2 |  | Managements Discussion and Analysis of the registrant for the years ended August 31, 2015, 2014 and 2013.                                                                                                                                                                                                                                                                                                                                                                                  



| | Filed herewith.
|- | ---------------



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SIGNATURE PAGE

The Registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the
undersigned to sign this annual report on its behalf.



| |  |                          |  |  |  |                                           |  |                                      
| |  | ------------------------ |  |  |  | ----------------------------------------- |  | -------------------------------------
| |  |                          |  |  |  | Postmedia Network Canada Corp.
REGISTRANT
| |  |                          |  | 
| |  |                          |  |  |  | By:                                       |  | /s/ Paul Godfrey                     
| |  |                          |  |  |  |                                           |  | Paul Godfrey                         
| |  | Dated: November 25, 2015 |  |  |  |                                           |  | President and Chief Executive Officer



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