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CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN
12 Months Ended
Dec. 27, 2015
CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN  
CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

12.  CONTRIBUTION OF REAL PROPERTY TO QUALIFIED DEFINED BENEFIT PLAN

On February 11, 2016,  we contributed company-owned real property from six locations to our Pension Plan. The Pension Plan obtained independent appraisals of the property, and based on these appraisals, recorded the contribution (the fair value of the property) at $47.1 million on February 11, 2016.  

We have entered into leases for the contributed properties for 11 years at an aggregate annual rent of approximately $3.5 million and we expect to continue to use the properties in our newspaper operations at the six locations. The properties will be managed on behalf of the pension plan by an independent fiduciary, and the terms of the leases were negotiated with the fiduciary.

The contribution and leaseback of the properties are treated as a financing transaction and accordingly, we will continue to depreciate the carrying value of the properties in our financial statements and no gain or loss is recognized. The $47.1 million will be recorded in financing obligations and will be reduced by a portion of lease payments made to the pension plan. The transaction will be recorded in the quarter ended March 27, 2016 and therefore the funded status of our qualified pension plan disclosed in Note 7 and elsewhere in these financial statements does not reflect this transaction.