Leases

6 Months Ended

Jul. 01, 2023

Note 3 – Leases

The net right of use assets and lease liabilities recognized on the consolidated condensed balance sheets for the Company's operating leases were as follows:

	July 1, 2023		December 31, 2022
Right of use assets
Operating Leases
Buildings and improvements	$	126,458	$	126,933
Machinery and equipment		5,002		4,260
Total	$	131,460	$	131,193
Current lease liabilities
Operating Leases
Buildings and improvements	$	23,456	$	22,926
Machinery and equipment		2,661		2,393
Total	$	26,117	$	25,319
Long-term lease liabilities
Operating Leases
Buildings and improvements	$	104,893	$	106,693
Machinery and equipment		2,256		1,800
Total	$	107,149	$	108,493
Total lease liabilities	$	133,266	$	133,812

Lease expense is classified in the statements of operations based on asset use. Total lease cost recognized on the consolidated condensed statements of operations is as follows:

	Fiscal quarters ended				Six fiscal months ended
	July 1, 2023		July 2, 2022		July 1, 2023		July 2, 2022
Lease expense
Operating lease expense	$	6,887	$	6,304	$	13,768	$	12,756
Short-term lease expense		252		236		508		540
Variable lease expense		159		-		311		100
Total lease expense	$	7,298	$	6,540	$	14,587	$	13,396

The Company paid $13,966 and $12,241 for its operating leases in the six fiscal months ended July 1, 2023 and July 2, 2022, respectively, which are included in operating cash flows on the consolidated condensed statements of cash flows. The weighted-average remaining lease term for the Company's operating leases is 9.6 years and the weighted-average discount rate is 6.2% as of July 1, 2023.

The undiscounted future lease payments for the Company's operating lease liabilities are as follows:

	July 1, 2023
2023 (excluding the six fiscal months ended July 1, 2023)	$	13,840
2024		25,985
2025		22,556
2026		18,778
2027		17,258
Thereafter		80,762

The undiscounted future lease payments presented in the table above include payments through the term of the lease, which may include periods beyond the noncancellable term. The difference between the total payments above and the lease liability balance is due to the discount rate used to calculate lease liabilities.