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Note 11 - Leases

3 Months Ended

Mar. 27, 2021

11.

Leases

We lease certain of our facilities, equipment and vehicles under non-cancelable operating and finance leases. Leases with initial terms of 12 months or less are not recorded on the condensed consolidated balance sheet, but we recognized those lease payments in the condensed consolidated statements of operations on a straight-line basis over the lease term. Lease and non-lease components are included in the calculation of the ROU asset and lease liabilities.

Our leases have remaining lease terms of 1 year to 37 years, some of which include one or more options to extend the leases for up to 25 years. Our lease term includes renewal terms when we are reasonably certain we will exercise the renewal options.

We sublease certain leased assets to third parties, mainly as a result of unused space in our facilities. Supplemental balance sheet information related to leases was as follows:

(in thousands)	Classification	March 27, 2021			December 26, 2020
Assets
Operating lease assets	Operating lease right-of-use assets	$	29,917		$	29,203
Finance lease assets	Property, plant and equipment, net ⁽¹⁾		502			486
Total lease assets		$	30,419		$	29,689
Liabilities
Current
Operating	Other accrued liabilities	$	5,490		$	5,287
Finance	Other accrued liabilities		182			179
Noncurrent
Operating	Long-term lease liabilities		26,041			25,565
Finance	Long-term lease liabilities		210			222
Total lease liabilities		$	31,923		$	31,253

Weighted-average remaining lease term (years)
Operating leases			7.1			7.3
Finance leases			2.4			2.3

Weighted-average discount rate
Operating leases			6.2	%		6.3	%
Finance leases			0.6	%		0.0	%

(1)

Finance lease assets are recorded net of accumulated amortization of $0.1 million as of March 27, 2021 and December 26, 2020.

The components of lease expense were as follows:

	Three Months Ended
(in thousands)	March 27, 2021			March 28, 2020
Operating leases	$	2,040		$	2,151
Variable lease expense		552			532
Short-term operating leases		33			19
Finance leases
Amortization of leased assets		21			20
Interest on lease liabilities		-			28
Sublease income		(19	)		(32	)
Net lease cost	$	2,627		$	2,718

Future minimum lease payments at March 27, 2021, are as follows:

	Operating			Finance
(in thousands)	leases⁽¹⁾			leases			Total
2021	$	5,435		$	138		$	5,573
2022		6,742			184			6,926
2023		5,771			51			5,822
2024		5,139			11			5,150
2025		4,820			11			4,831
Thereafter		12,181			2			12,183
Total lease payments		40,088			397			40,485
Less: Interest		(8,557	)		(5	)		(8,562	)
Present value of lease liabilities	$	31,531		$	392		$	31,923

(1)

Excludes sublease income of $0.1 million in 2021.

Supplemental cash flow information related to leases was as follows:

	Three Months Ended
(in thousands)	March 27, 2021		March 28, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	1,943	$	2,133
Operating cash flows from finance leases	$	-	$	28
Financing cash flows from finance leases	$	45	$	9
Leased assets obtained in exchange for new finance lease liabilities	$	54	$	373
Leased assets obtained in exchange for new operating lease liabilities	$	2,350	$	1,062