Subsequent Event

12 Months Ended

Dec. 25, 2011

NOTE 11.

SUBSEQUENT EVENT

On January 24, 2012, the Company entered into a contract to purchase approximately 6.1 acres of land located in Doral, Fla., for approximately $3.1 million. McClatchy intends to build a new production facility on this site for The Miami Herald and El Nuevo Herald newspaper operations. On the same day, the Company entered into an agreement to lease a two-story office building adjacent to the future production facility. The newspapers plan to relocate their operations from their current location to the new site in May 2013.

The lease on the office building is an operating lease with initial annual base lease payments of $1.8 million beginning in May 2013 when the building is expected to be occupied. Total costs related to relocating the newspapers' operations and for constructing the new production facility, including the purchase of the property, construction costs, accelerated depreciation, and moving expenses is estimated to be as follows:

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Capital expenditures related to the new facilities are estimated to be $32 million.

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Cash expenses to relocate the Miami newspapers' operations are expected to be $12 million.

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In addition, the Company will incur $13 million in accelerated depreciation on existing assets expected to be retired or decommissioned.

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$6 million of the cash costs will be reimbursed from an escrow account established for this purpose by the purchaser of the existing Miami facilities.

The relocation is expected to be completed in May 2013, and accordingly, the costs and expenses are expected to be incurred over the next approximately 16 months.