Guarantees, Commitments and Contingencies

12 Months Ended

Sep. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

Guarantees, Commitments and Contingencies

10. Guarantees, Commitments and Contingencies

Litigation

At September 30, 2023, the Company had a number of product liability and other cases pending. Management believes that, considering the Company’s insurance coverage and its intention to vigorously defend its positions, the ultimate resolution of these matters will not have a material adverse impact on the Company’s financial statements.

Environmental

The Company is subject to a variety of environmental regulations relating to the use, storage, discharge and disposal of hazardous materials used in its manufacturing processes. Failure by the Company to comply with present and future regulations could subject it to future liabilities. In addition, such regulations could require the Company to acquire costly equipment or to incur other significant expenses to comply with environmental regulations. The Company is currently not involved in any material environmental proceedings and therefore, management believes that the resolution of environmental matters will not have a material adverse effect on the Company’s financial statements. Our environmental liability, included in current accrued expenses and other long-term liabilities on the Consolidated Balance Sheets, was $0.3 million and $0.1 million at September 30, 2023 and October 1, 2022, respectively. Cash flows over the next five years are expected to be immaterial each year, with no material difference between total cash flows and our accrued balance.

Lease Commitments

We have operating and finance leases for office space, warehouse space, or a combination of both. Our leases have remaining lease terms ranging from 0.3 years to 5.9 years with the option to extend leases for up to 0.3 years.

The components of lease costs included on the Consolidated Statements of Operations are as follows:

(in thousands)		Fiscal Years Ended
Lease cost	Classification	2023		2022
Operating leases	Selling, general and administrative expenses	$	2,188	$	1,399
Finance leases
Amortization of lease assets	Cost of goods sold	702		1,157
Interest on lease liabilities	Interest expense	60		171
Short-term leases (1)	Cost of goods sold or selling, general and administrative expenses	1,993		995
Total lease cost		$	4,943	$	3,722

(1) Short-term lease cost includes both leases and rentals with initial terms of one year or less. Classification depends on the purpose of the underlying lease.

The following table summarizes the lease amounts included on the Consolidated Balance Sheets as follows:

(in thousands)	Balance Sheet Location	September 30, 2023		October 1, 2022
Assets
Operating	Property, plant and equipment	$	4,298	$	5,487
Finance (1)	Finance lease right-of-use	1,034		1,736
Total lease assets		$	5,332	$	7,223
Liabilities
Current
Operating	Other current liabilities	$	1,593	$	2,150
Finance	Finance lease obligations	583		566
Long-term
Operating	Other liabilities	3,608		4,578
Finance	Finance lease obligations	987		1,574
Total lease liabilities		$	6,771	$	8,868

(1) Net of accumulated amortization of $2.5 million and $1.8 million, respectively.

The financing and operating leases recorded do not assume renewal based on our analysis of those leases and their contractual terms.

Lease liability maturities are presented in the following table:

(in thousands)	September 30, 2023
Fiscal Years Ended	Operating		Finance		Total
2024	$	1,878	$	631	$	2,509
2025	1,640		994		2,634
2026	1,284		—		1,284
2027	776		—		776
2028	208		—		208
Thereafter	88		—		88
Total future minimum lease payments	5,874		1,625		7,499
Less: imputed interest	673		55		728
Total lease liabilities	$	5,201	$	1,570	$	6,771

Lease terms and discount rates are presented in the following table:

	September 30, 2023
	Operating		Finance
Weighted average remaining lease term	3.5 years		1.5 years
Weighted average discount rate	5.0	%	3.3	%

Supplemental cash flow information is presented in the following table:

	Fiscal Years Ended
(in thousands)	2023		2022
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows - operating leases	$	2,688	$	1,572
Operating cash flows - finance leases	60		171
Financing cash flows - finance leases	570		1,132
Right-of-use assets exchanged for lease liabilities
Operating leases	$	626	$	1,424

Purchase Commitments

In the ordinary course of business, the Company enters into short-term contractual purchase orders for manufacturing inventory and capital assets. The amount of these commitments is expected to be as follows:

(in thousands)
Fiscal Years Ended	Amount
2024	$	109,187
Total purchase commitments	$	109,187