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Note 11 - Leases

6 Months Ended

Jun. 26, 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	June 26, 2021			December 26, 2020
Assets
Operating lease assets	Operating lease right-of-use assets	$	26,850		$	29,203
Finance lease assets	Property, plant and equipment, net ⁽¹⁾		486			486
Total lease assets		$	27,336		$	29,689
Liabilities
Current
Operating	Other accrued liabilities	$	4,796		$	5,287
Finance	Other accrued liabilities		185			179
Noncurrent
Operating	Long-term lease liabilities		23,646			25,565
Finance	Long-term lease liabilities		167			222
Total lease liabilities		$	28,794		$	31,253

Weighted-average remaining lease term (years)
Operating leases			7.0			7.3
Finance leases			2.2			2.3

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

(1)

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

The components of lease expense were as follows:

	Three Months Ended						Six Months Ended
(in thousands)	June 26, 2021			June 27, 2020			June 26, 2021			June 27, 2020
Operating leases	$	2,027		$	2,112		$	4,067		$	4,263
Variable lease expense		574			547			1,126			1,079
Short-term operating leases		34			19			67			38
Finance leases
Amortization of leased assets		24			28			45			48
Interest on lease liabilities		1			29			1			57
Sublease income		(21	)		(31	)		(40	)		(63	)
Net lease cost	$	2,639		$	2,704		$	5,266		$	5,422

Future minimum lease payments at June 26, 2021, are as follows:

	Operating			Finance
(in thousands)	leases⁽¹⁾			leases			Total
2021	$	3,200		$	93		$	3,293
2022		6,120			186			6,306
2023		5,177			52			5,229
2024		4,898			11			4,909
2025		4,823			11			4,834
Thereafter		12,181			4			12,185
Total lease payments		36,399			357			36,756
Less: Interest		(7,957	)		(5	)		(7,962	)
Present value of lease liabilities	$	28,442		$	352		$	28,794

(1)

Excludes sublease income of $0.1 million in 2022.

Supplemental cash flow information related to leases was as follows:

	Six Months Ended
(in thousands)	June 26, 2021		June 27, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,308	$	4,123
Operating cash flows from finance leases	$	-	$	57
Financing cash flows from finance leases	$	91	$	68
Leased assets obtained in exchange for new finance lease liabilities	$	54	$	360
Leased assets obtained in exchange for new operating lease liabilities	$	2,827	$	1,576