9. COMMITMENTS AND CONTINGENCIES

As of December 30, 2012, we had purchase obligations primarily related to printing outsource agreements and capital expenditures for property, plant and equipment expiring at various dates through 2028, totaling $139.2 million. The following table summarizes our purchase obligations as of December 30, 2012 and the estimated timing and effect the obligations will have on our liquidity and cash flows in future periods:

Year	(in thousands)

2013	$	39,250
2014		18,039
2015		15,846
2016		14,966
2017		14,353
Thereafter		36,760

Total	$	139,214

As of December 30, 2012, we had a fiscal year 2013 purchase commitment of 81,648 metric tons of newsprint from SP Fiber Technologies.

Lease commitments

We rent certain facilities and equipment under operating leases expiring at various dates through 2028. Total rental expense, included in other operating expenses, from continuing operations amounted to $12.5 million in fiscal year 2012, $13.3 million in fiscal year 2011 and $14.5 million in fiscal year 2010. Most of the leases provide that we pay taxes, maintenance, insurance and certain other operating expenses applicable to the leased premises in addition to the minimum monthly payments. Some of the operating leases have built in escalation clauses.

We sublease office space to other companies under noncancellable agreements that expire at various dates through 2019. Sublease income from operating leases totaled $3.8 million, $4.4 million and $3.0 million in fiscal year 2012, 2011 and fiscal year 2010, respectively.

Minimum rental commitments under operating leases with non-cancelable terms in excess of one year and sublease income from leased space are:

(in thousands)

(in thousands)	Lease Obligation		Sublease Income
Year	Lease Obligation		Sublease Income			Net Amount
2013	$	12,276	$	(2,968	)	$	9,308
2014		10,798		(1,899	)		8,899
2015		8,891		(1,412	)		7,479
2016		7,419		(733	)		6,686
2017		6,962		(310	)		6,652
Thereafter		34,069		(441	)		33,628

Total	$	80,415	$	(7,763	)	$	72,652

Self-Insurance

We retain the risk for workers' compensation resulting from uninsured deductibles per accident or occurrence that are subject to annual aggregate limits. Losses up to the deductible amounts are accrued based upon known claims incurred and an estimate of claims incurred but not reported. For the year ended December 30, 2012, we compiled our historical data pertaining to the self-insurance experiences and actuarially developed the ultimate loss associated with our self-insurance programs for workers' compensation liability. We believe that the actuarial valuation provides the best estimate of the ultimate losses to be expected under these programs.

The undiscounted ultimate losses of all our self-insurance reserve related to our workers' compensation liabilities, net of insurance recoveries at December 30, 2012 and December 25, 2011, were $19.8 million and $20.5 million, respectively. Based on historical payment patterns, we expect payments of undiscounted ultimate losses, net of estimated insurance recoveries of approximately $9.1 million, to be as follows:

Year	Net Amount (in thousands)

2013	$	4,827
2014		3,377
2015		2,478
2016		1,889
2017		1,481
Thereafter		5,717

Total	$	19,769

We discount the net amount above to present value using an approximate risk-free rate over the average life of our insurance claims. For the years ended December 30, 2012 and December 25, 2011, the discount rate used was 1.1% and 1.4%, respectively. The present value of all self-insurance reserves, net of estimated insurance recoveries, for our workers' compensation liability recorded at December 30, 2012 and December 25, 2011, was $19.8 million and $20.4 million, respectively.

Legal Proceedings and other contingent claims

We are subject to a variety of legal proceedings (including libel, employment, wage and hour, independent contractor and other legal actions) and governmental proceedings (including environmental matters) that arise from time to time in the ordinary course of our business. We are unable to estimate the amount or range of reasonably possible losses. However, we currently believe, after reviewing such actions with counsel, that the expected outcome of pending actions will not have a material effect on our condensed consolidated financial statements. No material amounts for any losses from litigation that may ultimately occur have been recorded in the consolidated financial statements as we believe that any such losses are not probable.

We have certain indemnification obligations related to the sale of assets including but not limited to insurance claims and multi-employer pension plans of disposed newspaper operations. We believe the remaining obligations related to disposed assets will not be material to our financial position, results of operations or cash flows. In fiscal year 2010, we reversed a reserve, and recorded income, of $6.5 million related to certain of the indemnification obligations as the related newspapers paid current amounts and showed us their ability to continue to meet their obligations.

In addition to the $36.1 million of standby letters of credit secured under the Credit Agreement (see Note 5 for further discussion), we have $2.2 million in letters of credit arising from insurance and other potential claims. These letters of credit are collateralized with $2.2 million in certificates of deposit and are recorded as other long-term assets in our consolidated balance sheet.