<PAGE>
                                                                   Exhibit 1.1 f

[CANADA LETTERHEAD]  Industry Canada    Industrie Canada

CERTIFICATE                                           CERTIFICAT
OF AMENDMENT                                          DE MODIFICATION

CANADA BUSINESS                                       LOI CANADIENNE SUR
CORPORATIONS ACT                                      LES SOCIETES PAR ACTIONS

HOLLINGER INC.                                               197578-1

<TABLE>
-----------------------------------------------------------------         ----------------------------------------------------------
<S>                                                                 <C>   <C>
Name of corporation-Denomination de la societe                            Corporation number-Numero de la societe

I hereby certify that the articles of the above-named corporation         Je certifie que les statuts de la societe susmentionnee
were amended                                                              ont ete modifies :

(a) under section 13 of the Canada Business Corporations Act in     [ ]   a) en vertu de l'article 13 de la Loi canadienne sur les
accordance with the attached notice;                                      societes par actions, conformement a l'avis ci-joint;

(b) under section 27 of the Canada Business Corporations Act as     [x]   b) en vertu de l'article 27 de la Loi canadienne sur les
set out in the attached articles of amendment designating a               societes par actions, tel qu'il est indique dans les
series of shares;                                                         clauses modificatrices ci-jointes designant une serie
                                                                          d'actions;

(c) under section 179 of the Canada Business Corporations Act as    [ ]   c) en vertu de l'article 179 de la Loi canadienne sur les
set out in the attached articles of amendment;                            societes par actions, tel qu'il est indique dans les
                                                                          clauses modificatrices ci-jointes;

(d) under section 191 of the Canada Business Corporations Act as    [ ]   d) en vertu de l'article 191 de la Loi canadienne sur les
set out in the attached articles of reorganization.                       societes par actions, tel qu'il est indique dans les
                                                                          clauses de reorganisation ci-jointes.
</TABLE>


                                       NOVEMBER 7, 1997/LE 7 NOVEMBRE 1997
Director -  Directeur                  Date of Amendment - Date de modification

Canada

<PAGE>

[CANADA LETTERHEAD]
                                      FORM 4
                               ARTICLES OF AMENDMENT
                                (SECTION 27 OR 177)

--------------------------------------------------------------------------------
1 - NAME OF CORPORATION                            2 - CORPORATION NO.

         HOLLINGER INC.                                197578-1
--------------------------------------------------------------------------------
3 - THE ARTICLES OF THE ABOVE-NAMED CORPORATION ARE AMENDED AS FOLLOWS:

    The certificate and articles of the Corporation are amended to create the
    thirteenth series of Preference Shares, unlimited in number, to be
    designated Series I Exchangeable Non-Voting Preference Shares, and the
    fourteenth series of Preference Shares, unlimited in number, to be
    designated Series II Exchangeable Non-Voting Preference Shares, and to have
    attached thereto the rights, privileges, restrictions and conditions set
    forth in annexed Schedule A.
--------------------------------------------------------------------------------
DATE                    SIGNATURE                     TITLE

November 7, 1997                                      Vice-President & Secretary
--------------------------------------------------------------------------------
                                                      FOR DEPARTMENTAL USE ONLY
                                                      Filed
                                                      --------------------------

<PAGE>

                                   SCHEDULE A

                            NUMBER AND DESIGNATION OF
                      AND RIGHTS, PRIVILEGES, RESTRICTIONS
                           AND CONDITIONS ATTACHING TO
                         THE SERIES I PREFERENCE SHARES

                  The thirteenth series of Preference Shares of the Corporation
shall consist of an unlimited number of Preference Shares which shall be
designated as Exchangeable Non-Voting Preference Shares Series I (hereinafter
referred to as the "Series I Preference Shares") and which, in addition to the
rights, privileges, restrictions and conditions attached to the Preference
Shares as a class, shall have attached thereto the following rights, privileges,
restrictions and conditions:

1.                CONSIDERATION FOR ISSUE

1.1.              The consideration for the issue of each Series I Preference
Share shall be $4.00.

2.                INTERPRETATION

2.1.              DEFINITIONS

                  For the purpose hereof:

         (a)      "Act" means the Canada Business Corporations Act, as amended,
                  re-enacted or replaced from time to time;

         (b)      "Board" means the board of directors of the Corporation or the
                  Executive Committee thereof;

         (c)      "Business Day" means a day other than Saturday, Sunday or any
                  other day that is treated as a statutory holiday in the
                  jurisdiction in which the Corporation's registered office is
                  located;

         (d)      "Canadian Dollar Equivalent" means in respect of an amount
                  expressed in a foreign currency (the "Foreign Currency
                  Amount") at any date the product obtained by multiplying (A)
                  the Foreign Currency Amount by (B) the exchange rate for such
                  foreign currency in effect at 12 o'clock noon (eastern time)
                  on such date as posted by Canadian Imperial Bank of Commerce
                  or, in the event such exchange rate is not available, such
                  exchange rate on such date for such foreign currency as may be
                  deemed by the Board to be appropriate for such purpose;

<PAGE>

                                      - 2 -

         (e)      "Class A Common Shares" means shares of Class A common stock
                  of Hollinger International Inc., par value U.S. $0.01 per
                  share, and any other securities into which such shares may be
                  changed or for which such shares may be exchanged (whether or
                  not Hollinger International shall be the issuer of such other
                  securities) or any other consideration which may be received
                  by the holders of such shares pursuant to a recapitalization,
                  reconstruction, reorganization or reclassification of, or
                  amalgamation, merger, liquidation or similar transaction
                  affecting, such shares;

         (f)      "Current Class A Market Price" means in respect of a Class A
                  Common Share on any date, the Canadian Dollar Equivalent of
                  the per share closing price (or if no closing price is
                  recorded, the average of the bid and the ask prices) of Class
                  A Common Shares on the last full trading day preceding such
                  date as such price is reported on the NYSE Composite
                  Transactions Tape, or if the Class A Common Shares are not
                  listed on the NYSE, such other national, regional or
                  provincial securities exchange or automated quotation system
                  upon which the Class A Common Shares are listed or quoted, as
                  the case may be, as may be selected by the Board for such
                  purpose; provided, however, that if in the opinion of the
                  Board the public distribution or trading activity of Class A
                  Common Shares is inadequate to create a market that reflects
                  the fair market value of a Class A Common Share then the
                  Current Class A Market Price shall be determined by the Board
                  based upon the advice of such qualified independent financial
                  advisors as the Board may deem to be appropriate, and provided
                  further that any such selection, opinion or determination by
                  the Board shall be conclusive and binding;

         (g)      "Determination Date" means the fifth Business Day prior to the
                  Initial Period Expiry Date;

         (h)      "Dividend Amount" means, as at any date, an amount equal to
                  the full amount of all dividends and distributions declared
                  and unpaid on each Series I Preference Share and all dividends
                  and distributions declared on a Class A Common Share in
                  respect of which a dividend has not been declared on each
                  Series I Preference Share in accordance with section 3.1.2, in
                  each case with a record date prior to such date;

         (i)      "Exchange Price" means an amount per Series I Preference Share
                  surrendered for retraction pursuant to section 5.2 equal to
                  (i) the Current Class A Market Price on the Retraction Date of
                  the Exchange Number of Class A Common Shares plus (ii) the
                  Dividend Amount, if any, on the Retraction Date;

         (j)      "Exchange Number" means, subject to adjustment from time to
                  time in accordance with sections 5.8 and 5.9, the result
                  obtained when $4.00 is divided by (A) if the Initial Period
                  Expiry Date is May 6, 1998, the weighted average trading
                  price of the Class A Common Shares on the NYSE for the 20
                  consecutive trading days (whether or not Class A Common Shares
                  traded on such day) ending on (and

<PAGE>

                                     - 3 -

                  including) the Determination Date and (B) if the Initial
                  Period Expiry Date is prior to May 6, 1998, the lesser of (i)
                  the weighted average trading price of the Class A Common
                  Shares on the NYSE for the 20 consecutive trading days
                  (whether or not Class A Common Shares traded on such day)
                  ending on (and including) the Determination Date and (ii) the
                  weighted average trading price of the Class A Common Shares on
                  the NYSE on the Determination Date, provided that if the Class
                  A Common Shares are not listed on the NYSE on the relevant
                  date(s), the weighted average trading prices referred to above
                  shall be calculated using trading prices on any stock exchange
                  on which such shares are listed as the Board may select for
                  this purpose, or if such shares are not listed on any stock
                  exchange, in such over-the-counter market as the Board may
                  select for such purpose;

         (k)      "HII Dividend Declaration Date" means the date on which the
                  Board of Directors of Hollinger International declares any
                  dividend or distribution on the Class A Common Shares;

         (l)      "Hollinger International Capital Reorganization" has the
                  meaning set out in section 5.8.3;

         (m)      "Hollinger International" means Hollinger International Inc.,
                  a Delaware corporation;

         (n)      "Initial Period" means the period from the date of initial
                  issue of the Series I Preference Shares to and including the
                  Initial Period Expiry Date;

         (o)      "Initial Period Expiry Date" means May 6, 1998 unless the
                  Board elects pursuant to section 2.2 to select an earlier date
                  in which case the Initial Period Expiry Date shall be such
                  earlier date;

         (p)      "Initial Retraction Price" has the meaning set out in section
                  5.1;

         (q)      "junior share" means a share of the Corporation ranking junior
                  to the Series I Preference Shares with respect to the payment
                  of dividends or the distribution of assets in the event of the
                  liquidation, dissolution or winding-up of the Corporation,
                  whether voluntary or involuntary, or in the event of any other
                  distribution of assets of the Corporation among its
                  shareholders for the purpose of winding up its affairs;

         (r)      "Liquidation Event" has the meaning set out in section 8.1;

         (s)      "Liquidation Price" has the meaning set out in section 8.1;

         (t)      "NYSE" means the New York Stock Exchange;

<PAGE>

                                     - 4 -

         (u)      "ranking as to capital" means ranking with respect to the
                  distribution of assets in the event of a liquidation,
                  dissolution or winding-up of the Corporation, whether
                  voluntary or involuntary, or in the event of any other
                  distribution of assets of the Corporation among its
                  shareholders for the purpose of winding up its affairs;

         (v)      "Retraction Date" means any Business Day on which the
                  documents specified in section 5.3(a) are duly tendered by a
                  holder of Series I Preference Shares in respect of the
                  exercise of his or her retraction right pursuant to Article 5;
                  and

         (w)     "Retraction Notice" has the meaning set out in section 5.3(a).

2.2.              ELECTION TO SHORTEN THE INITIAL PERIOD

                  The Board shall be entitled to select a date prior to May 6,
1998 as the Initial Period Expiry Date. If the Board elects to do so then at
least three Business Days prior to the Initial Period Expiry Date, the
Corporation shall issue a press release and on or before the Initial Period
Expiry Date the Corporation shall send by prepaid first class mail or deliver a
notice to all holders of Series I Preference Shares each of which shall set out
the Determination Date, the Initial Period Expiry Date and the Exchange Number
as of the Initial Period Expiry Date. If the Corporation intends to exercise its
redemption right pursuant to section 4.1 such press release and notice shall
also set out the information contemplated by section 4.1.2.

2.3.              DATES

                  In the event that any date on which any dividend on the Series
I Preference Shares is payable by the Corporation, or on or by which any other
action is required to be taken by the Corporation or the holders of Series I
Preference Shares hereunder, is not a Business Day, then such dividend shall be
payable, or such other action shall be required to be taken, on or by the next
succeeding date that is a Business Day.

2.4.              CURRENCY

                  All cash amounts paid by the Corporation in respect of the
Series I Preference Shares shall be made in Canadian dollars and all references
herein to monetary amounts shall be construed accordingly.

                  For greater certainty, the determination of (i) Dividend
Amount and (ii) Exchange Number, shall be based on, respectively, (i) the
Canadian Dollar Equivalent on the payment date thereof of dividends and
distributions declared on Class A Common Shares and (ii) the Canadian Dollar
Equivalent on the Determination Date of the relevant weighted average trading
price of the Class A Common Shares.

<PAGE>

                                     - 5 -

3.                DIVIDENDS

3.1.              PAYMENT OF DIVIDENDS

                  The holders of the Series I Preference Shares shall be
entitled to receive, and the Corporation shall pay thereon, as and when declared
by the Board, subject to the insolvency provisions of applicable law, cumulative
preferential cash dividends payable in lawful money of Canada as follows:

         3.1.1.   during the Initial Period, a fixed dividend of 7.00% per annum
         of the issue price of $4.00 per share payable quarterly on each third
         month anniversary of November 6, 1997; and

         3.1.2.   after the Initial Period, a dividend per share as follows:

                  (a)      in the case of a cash dividend or distribution on
                           Class A Common Shares having a record date after the
                           Determination Date, in an amount in cash per Series I
                           Preference Share equal to the product of (i) the
                           Canadian Dollar Equivalent on the payment date
                           thereof of such cash dividend or distribution on each
                           Class A Common Share less any United States
                           withholding tax thereon payable by the Corporation or
                           any subsidiary thereof and (ii) the Exchange Number
                           as of the HII Dividend Declaration Date;

                  (b)      in the case of a stock dividend or distribution
                           declared on a Class A Common Share to be paid in
                           Class A Common Shares having a record date after the
                           Determination Date in respect of which an adjustment
                           is not made pursuant to section 5.8, in that number
                           of Series I Preference Shares for each Series I
                           Preference Share equal to the product of (i) the
                           number of Class A Common Shares to be paid on each
                           Class A Common Share less any United States
                           withholding tax thereon payable by the Corporation or
                           any subsidiary thereof and (ii) the Exchange Number
                           as of the HII Dividend Declaration Date; or

                  (c)      in the case of a dividend or distribution on the
                           Class A Common Shares to be paid in property other
                           than cash or Class A Common Shares, having a record
                           date after the Determination Date in respect of which
                           an adjustment is not made pursuant to section 5.8, in
                           such type and amount of property for each Series I
                           Preference Share as is the same as or economically
                           equivalent to (to be determined by the Board) the
                           type and amount of property declared as a dividend or
                           distribution on the Exchange Number (as of the HII
                           Dividend Declaration Date) of Class A Common Shares
                           less

<PAGE>

                                     - 6 -

                           any United States withholding tax thereon payable by
                           the Corporation or any subsidiary thereof.

         For any period during the Initial Period which is less than a full
         quarter with respect to any Series I Preference Share which is redeemed
         or in respect of which assets of the Corporation are distributed to the
         holders thereof pursuant to Article 8 during such quarter, dividends
         shall be deemed to accrue on a daily basis and shall be equal to the
         amount calculated by multiplying $0.28 by a fraction of which the
         numerator is the number of days in such period and the denominator is
         365.

3.2.              METHOD OF PAYMENT

         (a)      Cheques payable in lawful money of Canada at any branch in
                  Canada of the Corporation's bankers shall be issued in respect
                  of any cash dividends or distributions on the Series I
                  Preference Shares (less any tax required to be withheld by the
                  Corporation). The mailing, by prepaid first class mail, of
                  such a cheque to a holder of Series I Preference Shares, shall
                  be deemed to be payment of the dividends represented thereby
                  unless the cheque is not paid upon presentation. Dividends
                  which are represented by a cheque which has not been presented
                  to the Corporation's bankers for payment or that otherwise
                  remain unclaimed for a period of six years from the date on
                  which they were declared to be payable shall be forfeited to
                  the Corporation.

         (b)      Certificates registered in the name of the registered holder
                  of Series I Preference Shares shall be issued or transferred
                  in respect of any stock dividends or other distribution on
                  Series I Preference Shares contemplated by section 3.2(b)
                  hereof and the sending of such a certificate to each-holder of
                  a Series I Preference Share shall satisfy the stock dividend
                  or other distribution of Series I Preference Shares
                  represented thereby.

         (c)      Such other type and amount of property in respect of any
                  dividends or distributions contemplated by section 3.2(c)
                  hereof shall be issued, distributed or transferred by the.
                  Corporation in such manner as it shall determine and the
                  issuance, distribution or transfer thereof by the Corporation
                  to each holder of a Series I Preference Share shall satisfy
                  the dividend or distribution represented thereby.

         (d)      Notwithstanding anything to the contrary herein the
                  Corporation shall pay to any shareholder whose latest address
                  as shown on the books of the Corporation is not in Canada all
                  dividends in United States dollars unless any such shareholder
                  requests payment in Canadian dollars. Any such payment in
                  United States dollars shall be in an amount equivalent to the
                  amount otherwise payable in Canadian

<PAGE>

                                     - 7 -

                  dollars converted to United States dollars at the Bank of
                  Canada noon rate of exchange on the applicable dividend
                  record date.

3.3.              RECORD AND PAYMENT DATES

                  The record date for the determination of the holders of Series
I Preference Shares entitled to receive payment of, and the payment date for,
any dividend or distribution declared on the Series I Preference Shares under
section 3.1.2 hereof shall be the same as the record date and payment date,
respectively, for the corresponding dividend or distribution on the Class A
Common Shares.

3.4.              PARTIAL PAYMENT

                  If on any payment date for any dividends or distributions
declared on the Series I Preference Shares under section 3.1 hereof the
dividends or distributions are not paid in full on all of the Series I
Preference Shares then outstanding, any such dividends or distributions that
remain unpaid shall be paid on a subsequent date or dates determined by the
Board on which the Corporation shall have sufficient money or other assets
properly applicable to the payment of such dividends or distributions.

4.                REDEMPTION

4.1.              OPTIONAL REDEMPTION AT END OF INITIAL PERIOD

         4.1.1.   On the 30th day following the Initial Period Expiry Date (the
         "Redemption Date"), subject to the provisions of the Act, this Article
         4 and to the rights, privileges, restrictions and conditions attaching
         to any shares of the Corporation ranking prior to the Series I
         Preference Shares, the Corporation may, upon giving notice as
         hereinafter provided, redeem all or any part of the then outstanding
         Series I Preference Shares on payment for each share to be redeemed of
         $4.00 together with an amount equal to all dividends accrued and unpaid
         thereon up to the Redemption Date (the whole constituting and being
         herein referred to as the "Redemption Price"). In the case of a
         redemption of less than all of the Series I. Preference Shares pursuant
         to this section 4.1 the Corporation shall redeem as nearly as
         practicable the same portion of Series I Preference Shares held by each
         holder.

         4.1.2.   In case of redemption of Series I Preference Shares pursuant
         to section 4.1, at least three Business Days prior to the Initial
         Period Expiry Date the Corporation shall issue a press release and on
         or before the Initial Period Expiry Date the Corporation shall send by
         prepaid first class mail or deliver a notice to each person who at the
         date of mailing or delivery is a holder of Series I Preference Shares
         each of which shall state that the Corporation intends to redeem Series
         I Preference Shares pursuant to this section 4.1 and set out the
         Redemption Price and Redemption Date. Such notice shall be mailed or

<PAGE>

                                     - 8 -

         delivered to each holder of Series I Preference Shares to be redeemed
         at the last address of such holder as it appears on the securities
         register of the Corporation, or in the event of the address of any such
         holder not so appearing, then to the last address of such holder known
         to the Corporation. Accidental failure or omission to give such notice
         to one or more holders shall not affect the validity of such
         redemption, but if such failure or omission is discovered notice as
         aforesaid shall be given forthwith to such holder or holders and shall
         have the same force and effect as if given in due time. The press
         release shall also set out the portion of Series I Preference Shares to
         be redeemed and the notice shall also set out the number of Series I
         Preference Shares held by the person to whom it is addressed which are
         to be redeemed and the place or places in Canada at which holders of
         Series I Preference Shares may present and surrender the certificate or
         certificates representing such shares for redemption.

                           On and after the Initial Period Expiry Date, the
         Corporation shall pay or cause to be paid to or to the order of the
         holders of the Series I Preference Shares to be redeemed the Redemption
         Price of such shares on presentation and surrender, at the registered
         office of the Corporation or any other place or places in Canada
         specified in the notice of redemption, of the certificate or
         certificates representing the Series I Preference Shares called for
         redemption. Payment in respect of Series I Preference Shares being
         redeemed shall be made by cheque payable to the respective holders
         thereof in lawful money of Canada at any branch in Canada of the
         Corporation's bankers. If a part only of the Series I Preference Shares
         represented by any certificate shall be redeemed, a new certificate
         representing the balance of such shares shall be issued to the holder
         thereof at the expense of the Corporation upon presentation and
         surrender of the first mentioned certificate.

                           The Corporation shall have the right, at any time
         after the mailing or delivery of notice of its intention to redeem
         Series I Preference Shares, to deposit the Redemption Price of the
         Series I Preference Shares so called for redemption, or of such of the
         Series I Preference Shares which are represented by certificates which
         have not, at the date of such deposit, been surrendered by the holders
         thereof in connection with such redemption, in a separate account in
         any chartered bank or trust company in Canada named in the redemption
         notice or in a subsequent notice in writing to the holders of the
         Series I Preference Shares in respect of which the deposit is made, to
         be paid without interest to or to the order of the respective holders
         of the Series I Preference Shares called for redemption upon
         presentation and surrender to such bank or trust company of the
         certificates representing such shares. Upon such deposit being made or
         upon the Redemption Date, whichever is the later, the Series I
         Preference Shares in respect of which such deposit shall have been made
         shall be deemed to be redeemed and the rights of the holders thereof
         shall be limited to receiving, without interest, the Redemption Price
         of their respective Series I Preference Shares being redeemed upon
         presentation and surrender of the certificate or certificates
         representing such shares. Any interest allowed on any such deposit
         shall belong to the Corporation.

<PAGE>

                                     - 9 -

4.2.              OPTIONAL REDEMPTION RIGHT ON RECEIPT OF RETRACTION NOTICE

         4.2.1.   On receipt of a Retraction Notice in respect of Series I
         Preference Shares duly tendered pursuant to section 5.3, the
         Corporation shall be entitled to redeem all or any part of such Series
         I Preference Shares for a cash payment equal to the Initial Retraction
         Price or Exchange Price, as applicable. The Corporation shall exercise
         this redemption right by sending or causing to be sent by prepaid first
         class mail or delivering to the registered holder of Series I
         Preference Shares to be redeemed not later than five days after the
         Retraction Date a notice that the Corporation will redeem that number
         of Series I Preference Shares specified in such notice pursuant to this
         section 4.2.

         4.2.2.   The Corporation shall exercise this redemption right so that,
         subject to rules applicable to fractional shares, all holders of Series
         I Preference Shares to be redeemed on any date shall receive the same
         portion of the Initial Retraction Price or Exchange Price, as
         applicable, payable to them in the form of Class A Common Shares and
         cash.

         4.2.3.   The Corporation shall redeem Series I Preference Shares
         pursuant to this section 4.2 by sending or causing to be sent to or to
         the order of the registered holder thereof not later than 14 days after
         the Retraction Date a cheque payable at any branch of the Corporation's
         bankers for the Initial Retraction Price or Exchange Price, as
         applicable, of such shares.

4.3.              CESSATION OF RIGHTS

                  Series I Preference Shares redeemed pursuant to this Article
4 shall cease to be entitled to dividends or any other participation in any
distribution of the assets of the Corporation and the holders thereof shall not
be entitled to exercise any of their other rights as shareholders in respect
thereof unless the payment to be made on redemption shall not be made as
required in which case the rights of the holders shall remain unaffected.
Redemption moneys which are represented by a cheque which has not been presented
to the Corporation's bankers for payment or that otherwise remain unclaimed
(including moneys held on deposit in a separate account as provided for above)
for a period of six years from the date specified for redemption shall be
forfeited to the Corporation.

5.                RETRACTION RIGHTS

5.1.              RIGHT OF RETRACTION DURING INITIAL PERIOD

                  At any time during the Initial Period a holder of Series I
Preference Shares shall be entitled, subject to the provisions of the Act and in
the manner hereinafter provided, to require the Corporation to redeem all or any
of the Series I Preference Shares registered in the name of such holder in
consideration for the transfer to such holder of that number of Class A Common
Shares for each Series I Preference Share to be redeemed equal to (i) $3.50 plus
accrued and

<PAGE>

                                     - 10 -

unpaid dividends per Series I Preference Share to and including the Retraction
Date (the "Initial Retraction Price") divided by (ii) the Current Class A Market
Price on the Retraction Date.

5.2.              RIGHT OF RETRACTION AFTER INITIAL PERIOD

                  At any time after the Initial Period, a holder of Series I
Preference Shares shall be entitled, subject to the provisions of the Act and in
the manner hereinafter provided, to require the Corporation to redeem all or any
of the Series I Preference Shares registered in the name of the holder in
consideration for the transfer to such holder of that fraction or number of
Class A Common Shares for each Series I Preference Share to be redeemed equal to
(i) the Exchange Number in effect on the Retraction Date plus (ii) the quotient
obtained when the Dividend Amount, if any, as of the date of transfer of such
Class A Common Shares to such holder on the Hollinger International register is
divided by the Current Class A Market Price on such date.

5.3.              RETRACTION PROCEDURE

         (a)      Series I Preference Shares may be retracted only by the
                  registered holder thereof presenting and surrendering to the
                  Corporation, at any place where the Series I Preference Shares
                  may be transferred or at such other place or places as shall
                  be specified in writing by the Corporation to the holders of
                  the Series I Preference Shares from time to time, the share
                  certificate or certificates representing the Series I
                  Preference Shares to be redeemed, duly completed and endorsed
                  in the manner prescribed thereon, together with a request in
                  writing in such form as may be acceptable to the Corporation
                  (in this section 5.3, the "Retraction Notice") from such
                  holder specifying the number of Series I Preference Shares to
                  be redeemed by the Corporation.

         (b)      Subject to sections 4.2 and 5.6 hereof, the Corporation shall
                  redeem the appropriate number of Series I Preference Shares by
                  sending or causing to be sent to or to the order of the
                  registered holder thereof not later than 14 days after the
                  Retraction Date a certificate representing that number of
                  Class A Common Shares to which the holder is entitled.

         (c)      If less than all of the Series I Preference Shares represented
                  by any certificate or certificates so endorsed are to be
                  redeemed, the Corporation shall issue and deliver to such
                  holder, at the expense of the Corporation, a new share
                  certificate representing the Series I Preference Shares which
                  are not being surrendered for retraction.

5.4.              ELECTION IRREVOCABLE

                  Subject to paragraph 5.6 hereof, the election by a registered
holder of Series I Preference Shares to surrender any Series I Preference Shares
for retraction shall be irrevocable

<PAGE>

                                     - 11 -

upon receipt by the Corporation at its registered office of the Retraction
Notice and the certificate or certificates representing the Series I Preference
Shares to be redeemed; provided that the Corporation may, in its unfettered
discretion, permit withdrawal of any such election at any time prior to payment
of the Initial Retraction Price for the Series I Preference Shares to be
redeemed:

5.5.              RELATING TO THE DELIVERY OF CLASS A COMMON SHARES

         5.5.1.   QUALIFICATION AND LISTING

         The Corporation shall satisfy the following conditions in respect of
         Class A Common Shares delivered on a redemption of Series I Preference
         Shares:

                  (a)      the qualification of the Class A Common Shares by the
                           filing of a prospectus and obtaining a final receipt
                           therefor from the securities regulatory authorities
                           in each of the provinces of Canada in which the
                           distribution of such Class A Common Shares occurs,
                           unless there exists an applicable exemption to
                           qualification thereunder that allows such Class A
                           Common Shares (other than those issued to a person
                           who is in a position by himself or in combination
                           with others to materially affect control of the
                           Corporation) to be immediately traded free of resale
                           restrictions under applicable securities legislation;
                           and

                  (b)      the effectiveness of a registration statement under
                           the U.S. Securities Act of 1933 ("U.S. Securities
                           Act") with respect to the delivery of such Class A
                           Common Shares, unless an exemption from the
                           registration requirements of the U.S. Securities Act
                           is available which would allow such Class A Common
                           Shares to be immediately traded free of resale
                           restrictions; and

                  (c)      the listing of such Class A Common Shares on each
                           stock exchange on which the Class A Common Shares are
                           then listed.

         5.5.2.   FRACTIONS OF CLASS A COMMON SHARES

                           The Corporation shall not deliver a fraction of a
         Class A Common Share on redemption of Series I Preference Shares. In
         lieu thereof, the Corporation shall make a cash payment equal to the
         amount which would have been satisfied by the fraction of the Class A
         Common Share.

<PAGE>

                                     - 12 -

5.6.              RETRACTION LIMITATION

         (a)      If the redemption by the Corporation of all Series I
                  Preference Shares surrendered for retraction on a Retraction
                  Date would be contrary to applicable law, the Corporation
                  shall redeem only the maximum number of Series I Preference
                  Shares which it is then permitted to redeem selected pro rata
                  (disregarding fractions of shares) from the Series I
                  Preference Shares surrendered for retraction according to the
                  number of Series I Preference Shares surrendered for
                  retraction by each holder thereof. Thereupon, each such holder
                  shall be entitled, by notice to the Corporation to withdraw
                  all or part only of the Series I Preference Shares surrendered
                  by such holder for retraction on such Retraction Date which
                  have not been redeemed by the Corporation and the Corporation
                  shall, at its expense, issue and deliver to each holder who
                  exercises such right of withdrawal a new share certificate
                  representing the Series I Preference Shares so withdrawn.
                  Thereafter, the Corporation shall redeem on a date or dates
                  determined by the Board on which the Corporation shall have
                  sufficient assets to permit such redemption, the maximum
                  number of Series I Preference Shares as have been surrendered
                  for retraction and not withdrawn or redeemed which the
                  Corporation determines it is then permitted to redeem,
                  selected pro rata (disregarding fractions of shares) from such
                  Series I Preference Shares according to the number of such
                  Series I Preference Shares then held by each holder thereof
                  and so on until all such Series I Preference Shares have been
                  redeemed.

         (b)      If the Board has acted in good faith in making any of the
                  determinations referred to in paragraph 5.6(a) hereof, the
                  Board and the Corporation shall have no liability if such
                  determination proves to be inaccurate.

         (c)      If the Corporation does not redeem all Series I Preference
                  Shares surrendered for retraction on a Retraction Date the
                  Corporation shall forthwith after such date notify each holder
                  whose Series I Preference Shares have not been redeemed on
                  such date of such holder's right to withdraw the Series I
                  Preference Shares surrendered and not redeemed by the
                  Corporation.

5.7.              CESSATION OF RIGHTS

                  Series I Preference Shares redeemed pursuant to this Article
5 shall cease to be entitled to dividends or any other participation in any
distribution of the assets of the Corporation and the holders thereof shall not
be entitled to exercise any of their other rights as shareholders in respect
thereof as of the date on which Class A Common Shares deliverable to them on
redemption are transferred to them on the Hollinger International register.

<PAGE>

                                     - 13 -

5.8.              CHANGES AFFECTING THE CLASS A COMMON SHARES

         5.8.1.   If and whenever at any time after the Determination Date,
         Hollinger International:

                           (a)      subdivides its outstanding Class A Common
                                    Shares into a greater number of Class A
                                    Common Shares (including by way of a stock
                                    dividend which the Board decides to treat as
                                    a subdivision); or

                           (b)      consolidates its outstanding Class A Common
                                    Shares into a smaller number of Class A
                                    Common Shares,

                  then the Exchange Number will be adjusted effective
                  immediately after the effective date or record date for such
                  event by multiplying the Exchange Number in effect immediately
                  prior to such effective date or record date by a fraction, the
                  numerator of which will be the number of Class A Common Shares
                  outstanding immediately after giving effect to such event and
                  the denominator of which will be the number of Class A Common
                  Shares outstanding on such effective date or record date
                  before giving effect to such event.

         5.8.2.   If and whenever at any time after the date hereof, there is a
         reclassification of the Class A Common Shares at any time outstanding
         or change of the Class A Common Shares into other shares or into other
         securities or other capital reorganization (other than an event
         described in section 5.8.1), or a consolidation, amalgamation,
         arrangement or merger of Hollinger International with or into any other
         corporation or other entity (other than a consolidation, amalgamation,
         arrangement or merger which does not result in any reclassification of
         the outstanding Class A Common Shares or a change of the Class A Common
         Shares into other shares), or a transfer of the undertaking or assets
         of Hollinger International as an entirety or substantially as an
         entirety to another corporation or other entity in which the holders of
         Class A Common Shares are entitled to receive shares, other securities
         or other property (any of such events being called an "Hollinger
         International Capital Reorganization"), a holder of Series I Preference
         Shares will be entitled to receive on exercise of his or her retraction
         right pursuant to section 5.2, and shall accept in lieu of Class A
         Common Shares, the aggregate number of shares, other securities or
         other property which such holder would have been entitled to receive as
         a result of such Hollinger International Capital Reorganization if, on
         the effective date thereof, the holder had been the registered holder
         of the number of Class A Common Shares which such holder would have
         received if the Retraction Date were immediately prior to such
         effective date, subject in all such cases, to the Corporation's right
         to redeem Series I Preference Shares pursuant to section 4.2. If
         determined appropriate by the Board, appropriate adjustments will be
         made as a result of any such Hollinger International Capital
         Reorganization in the application of the provisions set forth in this
         Article with respect to the rights and interests thereafter of holders
         of Series I Preference Shares to the end that the provisions set forth
         in this Article will thereafter

<PAGE>

                                     - 14 -

         correspondingly be made applicable as nearly as may reasonably be in
         relation to any shares, other securities or other property thereafter
         deliverable upon the exercise of any Series I Preference Shares.

         5.8.3.   If and whenever at any time after the date hereof Hollinger
         International takes any action affecting the Class A Common Shares
         other than an action described in sections 3.1.2, 5.8.1 or 5.8.2 which
         in the opinion of the Board would materially affect the rights of the
         holders of Series I Preference Shares, the Exchange Number or other
         terms of Article 5 will be adjusted in such manner, if any, and at such
         time, by action by the Board, in their sole discretion, as they may
         determine to be equitable in the circumstances, but subject in all
         cases to any necessary regulatory approvals, including any approval
         required by any stock exchange on which the Series I Preference Shares
         may be listed. Failure of the taking of action by the Board so as to
         provide for an adjustment on or prior to the effective date of any such
         action will be conclusive evidence that the Board have determined that
         it is equitable to make no adjustment in the circumstances.

5.9.              RULES APPLICABLE TO ADJUSTMENTS

                  For the purposes of section 5.8:

         5.9.1.   The adjustments provided for in section 5.8 are cumulative and
         will be made successively whenever an event referred to therein occurs,
         subject to the following subsections of this section.

         5.9.2.   No adjustment of the Exchange Number will be required unless
         such adjustment would result in a change of at least 1%; provided,
         however, that any adjustments which, except for the provisions of this
         subsection would otherwise have been required to be made, will be
         carried forward and taken into account in any subsequent adjustment.

         5.9.3.   If at any time a dispute arises with respect to adjustments
         such dispute will be conclusively determined by the Corporation's
         auditors or if they are unable or unwilling to act, by such other firm
         of independent chartered accountants as may be selected by action by
         the Board and any such determination will be binding upon the
         Corporation and the holders of Series I Preference Shares; such
         auditors or accountants will be given access to all necessary records
         of the Corporation.

         5.9.4.   If Hollinger International sets a record date to determine the
         holders of Class A Common Shares to take any action and thereafter and
         before the taking of such action, legally abandons its plan to take
         such other action, then no adjustment will be required by reason of the
         setting of such record date.

<PAGE>

                                     - 15 -

         5.9.5.   No adjustment need be made for a transaction referred to in
         section 5.8 if holders of Series I Preference Shares participate in the
         transaction on a basis and with notice that the Board determines to be
         fair and appropriate in the circumstances.

6.                VOTING RIGHTS

6.1.              Except as herein referred to or as required by law, the
holders of the Series I Preference Shares as a series shall not be entitled as
such to receive notice of, to attend or to vote at any meeting of the
shareholders of the Corporation.

7.                RESTRICTIONS ON DIVIDENDS AND RETIREMENT OF SHARES

7.1.              So long as any of the Series I Preference Shares are
outstanding, the Corporation shall not, without the approval of the holders of
the Series I Preference Shares given as hereinafter specified:

         7.1.1.   declare, pay or set apart for payment any dividends on any
         junior shares (other than dividends payable in shares of the
         Corporation ranking as to capital and dividends junior to the Series I
         Preference Shares);

         7.1.2.   call for redemption, redeem, purchase or otherwise pay off or
         retire for value, or make any capital distributions in respect of, any
         junior shares;

         7.1.3.   except in connection with the redemption of Series I
         Preference Shares pursuant to Articles 4 or 5, call for redemption,
         redeem, purchase or otherwise pay off or retire for value, or make any
         capital distribution in respect of, less than all of the Series I
         Preference Shares;

         7.1.4.   call for redemption, redeem, purchase or otherwise pay off or
         retire for value, or make any capital distribution in respect of, any
         shares ranking as to capital or dividends on a parity with the Series I
         Preference Shares except in connection with the retirement thereof
         pursuant to a retraction privilege attaching thereto or a redemption
         right exercisable upon a retraction; or

         7.1.5.   issue any shares ranking as to capital or dividends prior to
         or on a parity with the Series I Preference Shares;

unless, in each such case, (i) all dividends on the Series I Preference Shares
then outstanding and on all other shares of the Corporation ranking as to
dividends prior to or on a parity with the Series I Preference Shares which have
accrued up to and including the dividends payable on the immediately preceding
respective date or dates for the payment of dividends thereon shall have
<PAGE>

                                     - 16 -

been declared and paid or set apart for payment, (ii) the Corporation shall have
redeemed all of the Series I Preference Shares tendered for redemption pursuant
to Article 5, and (iii) the Corporation is not otherwise in default under the
rights, privileges, restrictions and conditions attached to the Series I
Preference Shares or any other shares of the Corporation ranking as to dividends
or as to capital prior to or on a parity with the Series I Preference Shares.

8.                LIQUIDATION, DISSOLUTION OR WINDING-UP

8.1.              In the event of the liquidation, dissolution or winding-up of
the Corporation, whether voluntary or involuntary, or in the event of any other
distribution of assets of the Corporation among its shareholders for the purpose
of winding up its affairs (any such event being herein referred to as a
"Liquidation Event"), the holders of the Series I Preference Shares shall be
entitled to receive from the assets of the Corporation the following amount:

         (a)      if the Liquidation Event occurs during the Initial Period, a
                  sum equal to $4.00 for each Series I Preference Share held by
                  them respectively, plus an amount equal to all dividends
                  accrued and unpaid thereon up to the date of payment; and

         (b)      if the Liquidation Event occurs after the Initial Period, an
                  amount per share equal to (i) the Current Class A Market Price
                  on the date of the Liquidation Event of the Exchange Number of
                  Class A Common Shares (the "Liquidation Price") which shall be
                  satisfied in full by the Corporation causing to be delivered
                  to such holder the Exchange Number of Class A Common Shares
                  for each Series I Preference Share or, at the option of the
                  Corporation, by payment in lawful money of Canada of the
                  Liquidation Price, plus (ii) the Dividend Amount, if any, on
                  the date of transfer of such Class A Common Shares to such
                  holder.

The whole of such amounts shall be paid before any amount shall be paid by the
Corporation or any assets of the Corporation shall be distributed to holders of
shares of any class of the Corporation ranking as to capital junior to the
Series I Preference Shares. After payment to the holders of the Series I
Preference Shares of the amounts so payable to them, they shall not be entitled
to share in any further distribution of the assets of the Corporation.

9.                AMENDMENT

9.1.              The rights, privileges, restrictions and conditions attached
to the Series I Preference Shares may be added to, changed or removed by
Articles of Amendment, but only with the approval of the holders of the Series I
Preference Shares given as hereinafter specified in addition to any vote or
authorization required by law.

<PAGE>

                                     - 17 -

10.               APPROVAL OF HOLDERS OF THE SERIES I PREFERENCE SHARES

10.1.             The approval of the holders of the Series I Preference Shares
to add to, change or remove any right, privilege, restriction or condition
attaching to the Series I Preference Shares as a series or in respect of any
other matter requiring the consent of the holders of the Series I Preference
Shares may be given in such manner as may then be required by law, subject to a
minimum requirement that such approval be given by resolution signed by all the
holders of the Series I Preference Shares or passed by the affirmative vote of
at least 2/3 of the votes cast at a meeting of the holders of the Series I
Preference Shares duly called for that purpose.

                  The formalities to be observed with respect to the giving of
notice of any such meeting or any adjourned meeting, the quorum required
therefor and the conduct thereof shall be those from time to time prescribed by
the by-laws of the Corporation with respect to meetings of shareholders or if
not so prescribed, as required by the Act in force at the time of the meeting or
as otherwise required by law. On every poll taken at every meeting of holders of
Series I Preference Shares as a series, each holder of Series I Preference
Shares entitled to vote thereat shall have one vote in respect of each Series I
Preference Share held.

<PAGE>

                                     - 18 -

                            NUMBER AND DESIGNATION OF
                      AND RIGHTS, PRIVILEGES, RESTRICTIONS
                           AND CONDITIONS ATTACHING TO
                        THE SERIES II PREFERENCE SHARES

                  The fourteenth series of Preference Shares of the Corporation
shall consist of an unlimited number of Preference Shares which shall be
designated as Exchangeable Non-Voting Preference Shares Series II (hereinafter
referred to as the "Series II Preference Shares") and which, in addition to the
rights, privileges, restrictions and conditions attached to the Preference
Shares as a class, shall have attached thereto the following rights, privileges,
restrictions and conditions:

1.                CONSIDERATION FOR ISSUE

1.1.              The consideration for the issue of each Series II Preference
Share shall be $10.00.

2.                INTERPRETATION

2.1.              DEFINITIONS

                  For the purpose hereof:

         (a)      "Act" means the Canada Business Corporations Act, as amended,
                  re-enacted or replaced from time to time;

         (b)      "Board" means the board of directors of the Corporation or the
                  Executive Committee thereof;

         (c)      "Business Day" means a day other than Saturday, Sunday or any
                  other day that is treated as a statutory holiday in the
                  jurisdiction in which the Corporation's registered office is
                  located;

         (d)      "Canadian Dollar Equivalent" means in respect of an amount
                  expressed in a foreign currency (the "Foreign Currency
                  Amount") at any date the product obtained by multiplying (A)
                  the Foreign Currency Amount by (B) the exchange rate for such
                  foreign currency in effect at 12 o'clock noon (eastern time)
                  on such date as posted by Canadian Imperial Bank of Commerce
                  or, in the event such

<PAGE>

                                     - 19 -

                  exchange rate is not available, such exchange rate on such
                  date for such foreign currency as may be deemed by the Board
                  to be appropriate for such purpose;

         (e)      "Class A Common Shares" means shares of Class A common stock
                  of Hollinger International Inc., par value U.S. $0.01 per
                  share, and any other securities into which such shares may be
                  changed or for which such shares may be exchanged (whether or
                  not Hollinger International shall be the issuer of such other
                  securities) or any other consideration which may be received
                  by the holders of such shares pursuant to a recapitalization,
                  reconstruction, reorganization or reclassification of, or
                  amalgamation, merger, liquidation or similar transaction
                  affecting, such shares;

         (f)      "Current Class A Market Price" means in respect of a Class A
                  Common Share on any date, the Canadian Dollar Equivalent of
                  the per share closing price (or if no closing price is
                  recorded, the average of the bid and the ask prices) of Class
                  A Common Shares on the last full trading day preceding such
                  date as such price is reported on the NYSE Composite
                  Transactions Tape, or if the Class A Common Shares are not
                  listed on the NYSE, such other national, regional or
                  provincial securities exchange or automated quotation system
                  upon which the Class A Common Shares are listed or quoted, as
                  the case may be, as may be selected by the Board for such
                  purpose; provided, however, that if in the opinion of the
                  Board the public distribution or trading activity of Class A
                  Common Shares is inadequate to create a market that reflects
                  the fair market value of a Class A Common Share then the
                  Current Class A Market Price shall be determined by the Board
                  based upon the advice of such qualified independent financial
                  advisors as the Board may deem to be appropriate, and provided
                  further that any such selection, opinion or determination by
                  the Board shall be conclusive and binding;

         (g)      "Determination Date" means the fifth Business Day prior to the
                  Initial Period Expiry Date;

         (h)      "Dividend Amount" means, as at any date, an amount equal to
                  the full amount of all dividends and distributions declared
                  and unpaid on each Series II Preference Share and all
                  dividends and distributions declared on a Class A Common Share
                  in respect of which a dividend has not been declared on each
                  Series II Preference Share in accordance with section 3.1.2,
                  in each case with a record date prior to such date;

         (i)      "Exchange Price" means an amount per Series II Preference
                  Share surrendered for retraction pursuant to section 5.2 equal
                  to (i) the Current Class A Market Price on the Retraction Date
                  of the Exchange Number of Class A Common Shares plus (ii) the
                  Dividend Amount, if any, on the Retraction Date;

         (j)      "Exchange Number" means, subject to adjustment from time to
                  time in accordance with sections 5.8 and 5.9, the result
                  obtained when $10.00 is divided

<PAGE>

                                     - 20 -

                  by (A) if the Initial Period Expiry Date is November 8, 1999,
                  the weighted average trading price of the Class A Common
                  Shares on the NYSE for the 20 consecutive trading days
                  (whether or not Class A Common Shares traded on such day)
                  ending on (and including) the Determination Date and (B) if
                  the Initial Period Expiry Date is prior to November 8, 1999,
                  the lesser of (i) the weighted average trading price of the
                  Class A Common Shares on the NYSE for the 20. consecutive
                  trading days (whether or not Class A Common Shares traded on
                  such day) ending on (and including) the Determination Date and
                  (ii) the weighted average trading price of the Class A Common
                  Shares on the NYSE on the Determination Date, provided that if
                  the Class A Common Shares are not listed on the NYSE on the
                  relevant date(s), the weighted average trading prices referred
                  to above shall be calculated using trading prices on any stock
                  exchange on which such shares are listed as the Board may
                  select for this purpose, or if such shares are not listed on
                  any stock exchange, in such over-the-counter market as the
                  Board may select for such purpose;

         (k)      "HII Dividend Declaration Date" means the date on which the
                  Board of Directors of Hollinger International declares any
                  dividend or distribution on the Class A Common Shares;

         (1)      "Hollinger International Capital Reorganization" has the
                  meaning set out in section 5.8.3;

         (m)      "Hollinger International" means Hollinger International Inc.,
                  a Delaware corporation;

         (n)      "Initial Period" means the period from the date of initial
                  issue of the Series II Preference Shares to and including the
                  Initial Period Expiry Date;

         (o)      "Initial Period Expiry Date" means November 8, 1999 unless the
                  Board elects pursuant to section 2.2 to select an earlier date
                  in which case the Initial Period Expiry Date shall be such
                  earlier date;

         (p)      "Initial Retraction Price" has the meaning set out in section
                  5.1;

         (q)      "junior share" means a share of the Corporation ranking junior
                  to the Series II Preference Shares with respect to the payment
                  of dividends or the distribution of assets in the event of the
                  liquidation, dissolution or winding-up of the Corporation,
                  whether voluntary or involuntary, or in the event of any other
                  distribution of assets of the Corporation among its
                  shareholders for the purpose of winding up its affairs;

         (r)      "Liquidation Event" has the meaning set out in section 8.1;

<PAGE>

                                     - 21 -

         (s)      "Liquidation Price" has the meaning set out in section 8.1;

         (t)      "NYSE" means the New York Stock Exchange;

         (u)      "ranking as to capital" means ranking with respect to the
                  distribution of assets in the event of a liquidation,
                  dissolution or winding-up of the Corporation, whether
                  voluntary or involuntary, or in the event of any other
                  distribution of assets of the Corporation among its
                  shareholders for the purpose of winding up its affairs;

         (v)      "Retraction Date" means any Business Day on which the
                  documents specified in section 5.3(a) are duly tendered by a
                  holder of Series II Preference Shares in respect of the
                  exercise of his or her retraction right pursuant to Article 5;
                  and

         (w)      "Retraction Notice" has the meaning set out in section 5.3(a).

2.2.              ELECTION TO SHORTEN THE INITIAL PERIOD

                  The Board shall be entitled to select a date prior to November
8, 1999 (but not earlier than May 8, 1999) as the Initial Period Expiry Date. If
the Board elects to do so then at least three Business Days prior to the Initial
Period Expiry Date, the Corporation shall issue a press release and on or before
the Initial Period Expiry Date the Corporation shall send by prepaid first class
mail or deliver a notice to all holders of Series II Preference Shares each of
which shall set out the Determination Date, the Initial Period Expiry Date and
the Exchange Number as of the Initial Period Expiry Date. If the Corporation
intends to exercise its redemption right pursuant to section 4.1 such press
release and notice shall also set out the information contemplated by section
4.1.2.

2.3.              DATES

                  In the event that any date on which any dividend on the
Series II Preference Shares is payable by the Corporation, or on or by which any
other action is required to be taken by the Corporation or the holders of Series
II Preference Shares hereunder, is not a Business Day, then such dividend shall
be payable, or such other action shall be required to be taken, on or by the
next succeeding date that is a Business Day.

2.4.              CURRENCY

                  All cash amounts paid by the Corporation in respect of the
Series II Preference Shares shall be made in Canadian dollars and all references
herein to monetary amounts shall be construed accordingly.

                  For greater certainty, the determination of (i) Dividend
Amount and (ii) Exchange Number, shall be based on, respectively, (i) the
Canadian Dollar Equivalent on the payment date thereof of dividends and
distributions declared on Class A Common Shares and (ii) the Canadian

<PAGE>

                                     - 22 -

Dollar Equivalent on the Determination Date of the relevant weighted average
trading price of the Class A Common Shares.

3.                DIVIDENDS

3.1.              PAYMENT OF DIVIDENDS

                  The holders of the Series II Preference Shares shall be
entitled to receive, and the Corporation shall pay thereon, as and when declared
by the Board, subject to the insolvency provisions of applicable law, cumulative
preferential cash dividends payable in lawful money of Canada as follows:

3.1.1.            during the Initial Period, a fixed dividend of 7.00% per annum
of the issue price of $10.00 per share payable quarterly on each third month
anniversary of November 6, 1997; and

         3.1.2.   after the Initial Period, a dividend per share as follows:

                  (a)      in the case of a cash dividend or distribution on
                           Class A Common Shares having a record date after the
                           Determination Date, in an amount in cash per Series
                           II Preference Share equal to the product of (i) the
                           Canadian Dollar Equivalent on the payment date
                           thereof of such cash dividend or distribution on each
                           Class A Common Share less any United States
                           withholding tax thereon payable by the Corporation or
                           any subsidiary thereof and (ii) the Exchange Number
                           as of the HII Dividend Declaration Date;

                  (b)      in the case of a stock dividend or distribution
                           declared on a Class A Common Share to be paid in
                           Class A Common Shares having a record date after the
                           Determination Date in respect of which an adjustment
                           is not made pursuant to section 5.8, in that number
                           of Series II Preference Shares for each Series II
                           Preference Share equal to the product of (i) the
                           number of Class A Common Shares to be paid on each
                           Class A Common Share less any United States
                           withholding tax thereon payable by the Corporation or
                           any subsidiary thereof and (ii) the Exchange Number
                           as of the HII Dividend Declaration Date; or

                  (c)      in the case of a dividend or distribution on the
                           Class A Common Shares to be paid in property other
                           than cash or Class A Common Shares having a record
                           date after the Determination Date in respect of which
                           an adjustment is not made pursuant to section 5.8, in
                           such type and amount of property for each Series II
                           Preference Share as is the same as or economically
                           equivalent to (to be determined by the Board) the
                           type and amount of

<PAGE>

                                     - 23 -

                           property declared as a dividend or distribution on
                           the Exchange Number (as of the HII Dividend
                           Declaration Date) of Class A Common Shares less any
                           United States withholding tax thereon payable by the
                           Corporation or any subsidiary thereof.

         For any period during the Initial Period which is less than a full
         quarter with respect to any Series II Preference Share which is
         redeemed or in respect of which assets of the Corporation are
         distributed to the holders thereof pursuant to Article 8 during such
         quarter, dividends shall be deemed to accrue on a daily basis and shall
         be equal to the amount calculated by multiplying $0.70 by a fraction of
         which the numerator is the number of days in such period and the
         denominator is 365.

3.2.              METHOD OF PAYMENT

         (a)      Cheques payable in lawful money of Canada at any branch in
                  Canada of the Corporation's bankers shall be issued in respect
                  of any cash dividends or distributions on the Series II
                  Preference Shares (less any tax required to be withheld by the
                  Corporation). The mailing, by prepaid first class mail, of
                  such a cheque to a holder of Series II Preference Shares,
                  shall be deemed to be payment of the dividends represented
                  thereby unless the cheque is not paid upon presentation.
                  Dividends which are represented by a cheque which has not been
                  presented to the Corporation's bankers for payment or that
                  otherwise remain unclaimed for a period of six years from the
                  date on which they were declared to be payable shall be
                  forfeited to the Corporation.

         (b)      Certificates registered in the name of the registered holder
                  of Series II Preference Shares shall be issued or transferred
                  in respect of any stock dividends or other distribution on
                  Series II Preference Shares contemplated by section 3.2(b)
                  hereof and the sending of such a certificate to each holder of
                  a Series II Preference Share shall satisfy the stock dividend
                  or other distribution of Series II Preference Shares
                  represented thereby.

         (c)      Such other type and amount of property in respect of any
                  dividends or distributions contemplated by section 3.2(c)
                  hereof shall be issued, distributed or transferred by the
                  Corporation in such manner as it shall determine and the
                  issuance, distribution or transfer thereof by the Corporation
                  to each holder of a Series II Preference Share shall satisfy
                  the dividend or distribution represented thereby.

         (d)      Notwithstanding anything to the contrary herein the
                  Corporation shall pay to any shareholder whose latest address
                  as shown on the books of the Corporation is not in Canada all
                  dividends in United States dollars unless any such shareholder

<PAGE>

                                     - 24 -

                  requests payment in Canadian dollars. Any such payment in
                  United States dollars shall be in an amount equivalent to the
                  amount otherwise payable in Canadian dollars converted to
                  United States dollars at the Bank of Canada noon rate of
                  exchange on the applicable dividend record date.

3.3.              RECORD AND PAYMENT DATES

                  The record date for the determination of the holders of Series
II Preference Shares entitled to receive payment of, and the payment date for,
any dividend or distribution declared on the Series II Preference Shares under
section 3.1.2 hereof shall be the same as the record date and payment date,
respectively, for the corresponding dividend or distribution on the Class A
Common Shares.

3.4.              PARTIAL PAYMENT

                  If on any payment date for any dividends or distributions
declared on the Series II Preference Shares under section 3.1 hereof the
dividends or distributions are not paid in full on all of the Series II
Preference Shares then outstanding, any such dividends or distributions that
remain unpaid shall be paid on a subsequent date or dates determined by the
Board on which the Corporation shall have sufficient money or other assets
properly applicable to the payment of such dividends or distributions.

4.                REDEMPTION

4.1.              OPTIONAL REDEMPTION AT END OF INITIAL PERIOD

         4.1.1.   On the 30th day following the Initial Period Expiry Date (the
         "Redemption Date"), subject to the provisions of the Act, this Article
         4 and to the rights, privileges, restrictions and conditions attaching
         to any shares of the Corporation ranking prior to the Series II
         Preference Shares, the Corporation may, upon giving notice as
         hereinafter provided, redeem all or any part of the then outstanding
         Series II Preference Shares on payment for each share to be redeemed of
         $10.00 together with an amount equal to all dividends accrued and
         unpaid thereon up to the Redemption Date (the whole constituting and
         being herein referred to as the "Redemption Price"). In the case of a
         redemption of less than all of the Series II Preference Shares pursuant
         to this section 4.1 the Corporation shall redeem as nearly as
         practicable the same portion of Series II Preference Shares held by
         each holder.

         4.1.2.   In case of redemption of Series II Preference Shares pursuant
         to section 4.1, at least three Business Days prior to the Initial
         Period Expiry Date the Corporation shall issue a press release and on
         or before the Initial Period Expiry Date the Corporation shall send by
         prepaid first class mail or deliver a notice to each person who at the
         date of mailing or delivery is a holder of Series II Preference Shares
         each of which shall state that

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                                     - 25 -

         the Corporation intends to redeem Series II Preference Shares pursuant
         to this section 4.1 and set out the Redemption Price and Redemption
         Date. Such notice shall be mailed or delivered to each holder of Series
         II Preference Shares to be redeemed at the last address of such holder
         as it appears on the securities register of the Corporation, or in the
         event of the address of any such holder not so appearing, then to the
         last address of such holder known to the Corporation. Accidental
         failure or omission to give such notice to one or more holders shall
         not affect the validity of such redemption, but if such failure or
         omission is discovered notice as aforesaid shall be given forthwith to
         such holder or holders and shall have the same force and effect as if
         given in due time. The press release shall also set out the portion of
         Series II Preference Shares to be redeemed and the notice shall also
         set out the number of Series II Preference Shares held by the person to
         whom it is addressed which are to be redeemed and the place or places
         in Canada at which holders of Series II Preference Shares may present
         and surrender the certificate or certificates representing such shares
         for redemption.

                           On and after the Initial Period Expiry Date, the
         Corporation shall pay or cause to be paid to or to the order of the
         holders of the Series II Preference Shares to be redeemed the
         Redemption Price of such shares on presentation and surrender, at the
         registered office of the Corporation or any other place or places in
         Canada specified in the notice of redemption, of the certificate or
         certificates representing the Series II Preference Shares called for
         redemption. Payment in respect of Series II Preference Shares being
         redeemed shall be made by cheque payable to the respective holders
         thereof in lawful money of Canada at any branch in Canada of the
         Corporation's bankers. If a part only of the Series II Preference
         Shares represented by any certificate shall be redeemed, a new
         certificate representing the balance of such shares shall be issued to
         the holder thereof at the expense of the Corporation upon presentation
         and surrender of the first mentioned certificate.

                           The Corporation shall have the right, at any time
         after the mailing or delivery of notice of its intention to redeem
         Series II Preference Shares, to deposit the Redemption Price of the
         Series II Preference Shares so called for redemption, or of such of the
         Series II Preference Shares which are represented by certificates which
         have not, at the date of such deposit, been surrendered by the holders
         thereof in connection with such redemption, in a separate account in
         any chartered bank or trust company in Canada named in the redemption
         notice or in a subsequent notice in writing to the holders of the
         Series II Preference Shares in respect of which the deposit is made, to
         be paid without interest to or to the order of the respective holders
         of the Series II Preference Shares called for redemption upon
         presentation and surrender to such bank or trust company of the
         certificates representing such shares. Upon such deposit being made or
         upon the Redemption Date, whichever is the later, the Series II
         Preference Shares in respect of which such deposit shall have been made
         shall be deemed to be redeemed and the rights of the holders thereof
         shall be limited to receiving, without interest, the Redemption Price
         of their respective Series II Preference Shares being redeemed upon
         presentation and

<PAGE>

                                     - 26 -

         surrender of the certificate or certificates representing such shares.
         Any interest allowed on any such deposit shall belong to the
         Corporation.

4.2.              OPTIONAL REDEMPTION RIGHT ON RECEIPT OF RETRACTION NOTICE

         4.2.1.   On receipt of a Retraction Notice in respect of Series II
         Preference Shares duly tendered pursuant to section 5.3, the
         Corporation shall be entitled to redeem all or any part of such Series
         II Preference Shares for a cash payment equal to the Initial Retraction
         Price or Exchange Price, as applicable. The Corporation shall exercise
         this redemption right by sending or causing to be sent by prepaid first
         class mail or delivering to the registered holder of Series II
         Preference Shares to be redeemed not later than five days after the
         Retraction Date a notice that the Corporation will redeem that number
         of Series II Preference Shares specified in such notice pursuant to
         this section 4.2.

         4.2.2.   The Corporation shall exercise this redemption right so that,
         subject to rules applicable to fractional shares, all holders of Series
         II Preference Shares to be redeemed on any date shall receive the same
         portion of the Initial Retraction Price or Exchange Price, as
         applicable, payable to them in the form of Class A Common Shares and
         cash.

         4.2.3.   The Corporation shall redeem Series II Preference Shares
         pursuant to this section 4.2 by sending or causing to be sent to or to
         the order of the registered holder thereof not later than 14 days after
         the Retraction Date a cheque payable at any branch of the Corporation's
         bankers for the Initial Retraction Price or Exchange Price, as
         applicable, of such shares.

4.3.              CESSATION OF RIGHTS

                  Series II Preference Shares redeemed pursuant to this Article
4 shall cease to be entitled to dividends or any other participation in any
distribution of the assets of the Corporation and the holders thereof shall not
be entitled to exercise any of their other rights as shareholders in respect
thereof unless the payment to be made on redemption shall not be made as
required in which case the rights of the holders shall remain unaffected.
Redemption moneys which are represented by a cheque which has not been presented
to the Corporation's bankers for payment or that otherwise remain unclaimed
(including moneys held on deposit in a separate account as provided for above)
for a period of six years from the date specified for redemption shall be
forfeited to the Corporation.

5.                RETRACTION RIGHTS

5.1.              RIGHT OF RETRACTION DURING INITIAL PERIOD

                  At any time during the Initial Period a holder of Series II
Preference Shares shall be entitled, subject to the provisions of the Act and in
the manner hereinafter provided, to require

<PAGE>

                                     - 27 -

the Corporation to redeem all or any of the Series II Preference Shares
registered in the name of such holder in consideration for the transfer to such
holder of that number of Class A Common Shares for each Series II Preference
Share to be redeemed equal to (i) $8.50 plus accrued and unpaid dividends per
Series II Preference Share to and including the Retraction Date (the "Initial
Retraction Price") divided by (ii) the Current Class A Market Price on the
Retraction Date.

5.2.              RIGHT OF RETRACTION AFTER INITIAL PERIOD

                  At any time after the Initial Period, a holder of Series II
Preference Shares shall be entitled, subject to the provisions of the Act and in
the manner hereinafter provided, to require the Corporation to redeem all or any
of the Series II Preference Shares registered in the name of the holder in
consideration for the transfer to such holder of that fraction or number of
Class A Common Shares for each Series II Preference Share to be redeemed equal
to (i) the Exchange Number in effect on the Retraction Date plus (ii) the
quotient obtained when the Dividend Amount, if any, as of the date of transfer
of such Class A Common Shares to such holder on the Hollinger International
register is divided by the Current Class A Market Price on such date.

5.3.              RETRACTION PROCEDURE

         (a)      Series II Preference Shares may be retracted only by the
                  registered holder thereof presenting and surrendering to the
                  Corporation, at any place where the Series II Preference
                  Shares may be transferred or at such other place or places as
                  shall be specified in writing by the Corporation to the
                  holders of the Series II Preference Shares from time to time,
                  the share certificate or certificates representing the Series
                  II Preference Shares to be redeemed, duly completed and
                  endorsed in the manner prescribed thereon, together with a
                  request in writing in such form as may be acceptable to the
                  Corporation (in this section 5.3, the "Retraction Notice")
                  from such holder specifying the number of Series II Preference
                  Shares to be redeemed by the Corporation.

         (b)      Subject to sections 4.2 and 5.6 hereof, the Corporation shall
                  redeem the appropriate number of Series II Preference Shares
                  by sending or causing to be sent to or to the order of the
                  registered holder thereof not later than 14 days after the
                  Retraction Date a certificate representing that number of
                  Class A Common Shares to which the holder is entitled.

         (c)      If less than all of the Series II Preference Shares
                  represented by any certificate or certificates so endorsed are
                  to be redeemed, the Corporation shall issue and deliver to
                  such holder, at the expense of the Corporation, a new share
                  certificate representing the Series II Preference Shares which
                  are not being surrendered for retraction.

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                                     - 28 -

5.4.              ELECTION IRREVOCABLE

                  Subject to paragraph 5.6 hereof, the election by a registered
holder of Series II Preference Shares to surrender any Series II Preference
Shares for retraction shall be irrevocable upon receipt by the Corporation at
its registered office of the Retraction Notice and the certificate or
certificates representing the Series II Preference Shares to be redeemed;
provided that the Corporation may, in its unfettered discretion, permit
withdrawal of any such election at any time prior to payment of the Initial
Retraction Price for the Series II Preference Shares to be redeemed.

5.5.              RELATING TO THE DELIVERY OF CLASS A COMMON SHARES

         5.5.1.   QUALIFICATION AND LISTING

         The Corporation shall satisfy the following conditions in respect of
         Class A Common Shares delivered on a redemption of Series II Preference
         Shares:

                  (a)      the qualification of the Class A Common Shares by the
                           filing of a prospectus and obtaining a final receipt
                           therefor from the securities regulatory authorities
                           in each of the provinces of Canada in which the
                           distribution of such Class A Common Shares occurs,
                           unless there exists an applicable exemption to
                           qualification thereunder that allows such Class A
                           Common Shares (other than those issued to a person
                           who is in a position by himself or in combination
                           with others to materially affect control of the
                           Corporation) to be immediately traded free of resale
                           restrictions under applicable securities legislation;
                           and

                  (b)      the effectiveness of a registration statement under
                           the U.S. Securities Act of 1933 ("U.S. Securities
                           Act") with respect to the delivery of such Class A
                           Common Shares, unless an exemption from the
                           registration requirements of the U.S. Securities Act
                           is available which would allow such Class A Common
                           Shares to be immediately traded free of resale
                           restrictions; and

                  (c)      the listing of such Class A Common Shares on each
                           stock exchange on which the Class A Common Shares are
                           then listed.

         5.5.2.   FRACTIONS OF CLASS A COMMON SHARES

                           The Corporation shall not deliver a fraction of a
         Class A Common Share on redemption of Series II Preference Shares. In
         lieu thereof, the Corporation shall make a cash payment equal to the
         amount which would have been satisfied by the fraction of the Class A
         Common Share.

<PAGE>

                                     - 29 -

5.6.              RETRACTION LIMITATION

         (a)      If the redemption by the Corporation of all Series II
                  Preference Shares surrendered for retraction on a Retraction
                  Date would be contrary to applicable law, the Corporation
                  shall redeem only the maximum number of Series II Preference
                  Shares which it is then permitted to redeem selected pro rata
                  (disregarding fractions of shares) from the Series II
                  Preference Shares surrendered for retraction according to the
                  number of Series II Preference Shares surrendered for
                  retraction by each holder thereof. Thereupon, each such holder
                  shall be entitled, by notice to the Corporation to withdraw
                  all or part only of the Series II Preference Shares
                  surrendered by such holder for retraction on such Retraction
                  Date which have not been redeemed by the Corporation and the
                  Corporation shall, at its expense, issue and deliver to each
                  holder who exercises such right of withdrawal a new share
                  certificate representing the Series II Preference Shares so
                  withdrawn. Thereafter, the Corporation shall redeem on a date
                  or dates determined by the Board on which the Corporation
                  shall have sufficient assets to permit such redemption, the
                  maximum number of Series II Preference Shares as have been
                  surrendered for retraction and not withdrawn or redeemed which
                  the Corporation determines it is then permitted to redeem,
                  selected pro rata (disregarding fractions of shares) from such
                  Series II Preference Shares according to the number of such
                  Series II Preference Shares then held by each holder thereof
                  and so on until all such Series II Preference Shares have been
                  redeemed.

         (b)      If the Board has acted in good faith in making any of the
                  determinations referred to in paragraph 5.6(a) hereof, the
                  Board and the Corporation shall have no liability if such
                  determination proves to be inaccurate.

         (c)      If the Corporation does not redeem all Series II Preference
                  Shares surrendered for retraction on a Retraction Date the
                  Corporation shall forthwith after such date notify each holder
                  whose Series II Preference Shares have not been redeemed on
                  such date of such holder's right to withdraw the Series II
                  Preference Shares surrendered and not redeemed by the
                  Corporation.

5.7.              CESSATION OF RIGHTS

                  Series II Preference Shares redeemed pursuant to this Article
5 shall cease to be entitled to dividends or any other participation in any
distribution of the assets of the Corporation and the holders thereof shall not
be entitled to exercise any of their other rights as shareholders in respect
thereof as of the date on which Class A Common Shares deliverable to them on
redemption are transferred to them on the Hollinger International register.

<PAGE>

                                     - 30 -

5.8.              CHANGES AFFECTING THE CLASS A COMMON SHARES

         5.8.1.   If and whenever at any time after the Determination Date,
         Hollinger International:

                           (a)      subdivides its outstanding Class A Common
                                    Shares into a greater number of Class A
                                    Common Shares (including by way of a stock
                                    dividend which the Board decides to treat as
                                    a subdivision); or

                           (b)      consolidates its outstanding Class A Common
                                    Shares into a smaller number of Class A
                                    Common Shares,

                  then the Exchange Number will be adjusted effective
                  immediately after the effective date or record date for such
                  event by multiplying the Exchange Number in effect immediately
                  prior to such effective date or record date by a fraction, the
                  numerator of which will be the number of Class A Common Shares
                  outstanding immediately after giving effect to such event and
                  the denominator of which will be the number of Class A Common
                  Shares outstanding on such effective date or record date
                  before giving effect to such event.

         5.8.2.   If and whenever at any time after the date hereof, there is a
         reclassification of the Class A Common Shares at any time outstanding
         or change of the Class A Common Shares into other shares or into other
         securities or other capital reorganization (other than an event
         described in section 5.8.1), or a consolidation, amalgamation,
         arrangement or merger of Hollinger International with or into any other
         corporation or other entity (other than a consolidation, amalgamation,
         arrangement or merger which does not result in any reclassification of
         the outstanding Class A Common Shares or a change of the Class A Common
         Shares into other shares), or a transfer of the undertaking or assets
         of Hollinger International as an entirety or substantially as an
         entirety to another corporation or other entity in which the holders of
         Class A Common Shares are entitled to receive shares, other securities
         or other property (any of such events being called an "Hollinger
         International Capital Reorganization"), a holder of Series II
         Preference Shares will be entitled to receive on exercise of his or her
         retraction right pursuant to section 5.2, and shall accept in lieu of
         Class A Common Shares, the aggregate number of shares, other securities
         or other property which such holder would have been entitled to receive
         as a result of such Hollinger International Capital Reorganization if,
         on the effective date thereof, the holder had been the registered
         holder of the number of Class A. Common Shares which such holder would
         have received if the Retraction Date were immediately prior to such
         effective date, subject in all such cases, to the Corporation's right
         to redeem Series II Preference Shares pursuant to section 4.2. If
         determined appropriate by the Board, appropriate adjustments will be
         made as a result of any such Hollinger International Capital
         Reorganization in the application of the provisions set forth in this
         Article with respect to the rights and interests thereafter of holders
         of Series II Preference Shares to the end that the provisions set forth
         in this Article will thereafter

<PAGE>

                                     - 31 -

         correspondingly be made applicable as nearly as may reasonably be in
         relation to any shares, other securities or other property thereafter
         deliverable upon the exercise of any Series II Preference Shares.

         5.8.3.   If and whenever at any time after the date hereof Hollinger
         International takes any action affecting the Class A Common Shares
         other than an action described in sections 3.1.2, 5.8.1 or 5.8.2 which
         in the opinion of the Board would materially affect the rights of the
         holders of Series II Preference Shares, the Exchange Number or other
         terms of Article 5 will be adjusted in such manner, if any, and at such
         time, by action by the Board, in their sole discretion, as they may
         determine to be equitable in the circumstances, but subject in all
         cases to any necessary regulatory approvals, including any approval
         required by any stock exchange on which the Series II Preference Shares
         may be listed. Failure of the taking of action by the Board so as to
         provide for an adjustment on or prior to the effective date of any such
         action will be conclusive evidence that the Board have determined that
         it is equitable to make no adjustment in the circumstances.

5.9.              RULES APPLICABLE TO ADJUSTMENTS

                  For the purposes of section 5.8:

         5.9.1.   The adjustments provided for in section 5.8 are cumulative and
         will be made successively whenever an event referred to therein occurs,
         subject to the following subsections of this section.

         5.9.2.   No adjustment of the Exchange Number will be required unless
         such adjustment would result in a change of at least 1%; provided,
         however, that any adjustments which, except for the provisions of this
         subsection would otherwise have been required to be made, will be
         carried forward and taken into account in any subsequent adjustment.

         5.9.3.   If at any time a dispute arises with respect to adjustments
         such dispute will be conclusively determined by the Corporation's
         auditors or if they are unable or unwilling to act, by such other firm
         of independent chartered accountants as may be selected by action by
         the Board and any such determination will be binding upon the
         Corporation and the holders of Series II Preference Shares; such
         auditors or accountants will be given access to all necessary records
         of the Corporation.

         5.9.4.   If Hollinger International sets a record date to determine the
         holders of Class A Common Shares to take any action and thereafter and
         before the taking of such action, legally abandons its plan to take
         such other action, then no adjustment will be required by reason of the
         setting of such record date.

<PAGE>

                                     - 32 -

         5.9.5.   No adjustment need be made for a transaction referred to in
         section 5.8 if holders of Series II Preference Shares participate in
         the transaction on a basis and with notice that the Board determines to
         be fair and appropriate in the circumstances.

6.                VOTING RIGHTS

6.1.              Except as herein referred to or as required by law, the
holders of the Series II Preference Shares as a series shall not be entitled as
such to receive notice of, to attend or to vote at any meeting of the
shareholders of the Corporation.

7.                RESTRICTIONS ON DIVIDENDS AND RETIREMENT OF SHARES

7.1.              So long as any of the Series II Preference Shares are
outstanding, the Corporation shall not, without the approval of the holders of
the Series II Preference Shares given as hereinafter specified:

         7.1.1.   declare, pay or set apart for payment any dividends on any
         junior shares (other than dividends payable in shares of the
         Corporation ranking as to capital and dividends junior to the Series II
         Preference Shares);

         7.1.2.   call for redemption, redeem, purchase or otherwise pay off or
         retire for value, or make any capital distributions in respect of, any
         junior shares;

         7.1.3.   except in connection with the redemption of Series II
         Preference Shares pursuant to Articles 4 or 5, call for redemption,
         redeem, purchase or otherwise pay off or retire for value, or make any
         capital distribution in respect of, less than all of the Series II
         Preference Shares;

         7.1.4.   call for redemption, redeem, purchase or otherwise pay off or
         retire for value, or make any capital distribution in respect of, any
         shares ranking as to capital or dividends on a parity with the Series
         II Preference Shares except in connection with the retirement thereof
         pursuant to a retraction privilege attaching thereto or a redemption
         right exercisable upon a retraction; or

         7.1.5.   issue any shares ranking as to capital or dividends prior to
         or on a parity with the Series II Preference Shares;

unless, in each such case, (i) all dividends on the Series II Preference Shares
then outstanding and on all other shares of the Corporation ranking as to
dividends prior to or on a parity with the Series II Preference Shares which
have accrued up to and including the dividends payable on the immediately
preceding respective date or dates for the payment of dividends thereon shall
have

<PAGE>

                                     - 33 -

been declared and paid or set apart for payment, (ii) the Corporation shall have
redeemed all of the Series II Preference Shares tendered for redemption pursuant
to Article 5, and (iii) the Corporation is not otherwise in default under the
rights, privileges, restrictions and conditions attached to the Series II
Preference Shares or any other shares of the Corporation ranking as to dividends
or as to capital prior to or on a parity with the Series II Preference Shares.

8.                LIQUIDATION, DISSOLUTION OR WINDING-UP

8.1.              In the event of the liquidation, dissolution or winding-up of
the Corporation, whether voluntary or involuntary, or in the event of any other
distribution of assets of the Corporation among its shareholders for the purpose
of winding up its affairs (any such event being herein referred to as a
"Liquidation Event"), the holders of the Series II Preference Shares shall be
entitled to receive from the assets of the Corporation the following amount:

         (a)      if the Liquidation Event occurs during the Initial Period, a
                  sum equal to $10.00 for each Series II Preference Share held
                  by them respectively, plus an amount equal to all dividends
                  accrued and unpaid thereon up to the date of payment; and

         (b)      if the Liquidation Event occurs after the Initial Period, an
                  amount per share equal to (i) the Current Class A Market Price
                  on the date of the Liquidation Event of the Exchange Number of
                  Class A Common Shares (the "Liquidation Price") which shall be
                  satisfied in full by the Corporation causing to be delivered
                  to such holder the Exchange Number of Class A Common Shares
                  for each Series II Preference Share or, at the option of the
                  Corporation, by payment in lawful money of Canada of the
                  Liquidation Price, plus (ii) the Dividend Amount, if any, on
                  the date of transfer of such Class A Common Shares to such
                  holder.

The whole of such amounts shall be paid before any amount shall be paid by the
Corporation or any assets of the Corporation shall be distributed to holders of
shares of any class of the Corporation ranking as to capital junior to the
Series II Preference Shares. After payment to the holders of the Series II
Preference Shares of the amounts so payable to them, they shall not be entitled
to share in any further distribution of the assets of the Corporation.

9.                AMENDMENT

9.1.              The rights, privileges, restrictions and conditions attached
to the. Series II Preference Shares may be added to, changed or removed by
Articles of Amendment, but only with the approval of the holders of the Series
II Preference Shares given as hereinafter specified in addition to any vote or
authorization required by law.

<PAGE>

                                     - 34 -

10.               APPROVAL OF HOLDERS OF THE SERIES I PREFERENCE SHARES

10.1.             The approval of the holders of the Series II Preference Shares
to add to, change or remove any right, privilege, restriction or condition
attaching to the Series II Preference Shares as a series or in respect of any
other matter requiring the consent of the holders of the Series II Preference
Shares may be given in such manner as may then be required by law, subject to a
minimum requirement that such approval be given by resolution signed by all the
holders of the Series II Preference Shares or passed by the affirmative vote of
at least 2/3 of the votes cast at a meeting of the holders of the Series II
Preference Shares duly called for that purpose.

                  The formalities to be observed with respect to the giving of
notice of any such meeting or any adjourned meeting, the quorum required
therefor and the conduct thereof shall be those from time to time prescribed by
the by-laws of the Corporation with respect to meetings of shareholders or if
not so prescribed, as required by the Act in force at the time of the meeting or
as otherwise required by law. On every poll taken at every meeting of holders of
Series II Preference Shares as a series, each holder of Series II Preference
Shares entitled to vote thereat shall have one vote in respect of each Series II
Preference Share held.