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Note 7 - Leases

6 Months Ended

Jul. 03, 2021

We have operating leases for corporate offices, sales offices, research and development facilities, storage facilities, and a data center, the terms of which are described in our 2020 10-K. In the first quarter of fiscal 2021, we extended the leases for our Hillsboro, Oregon and Shanghai, China facilities, which resulted in approximately $7.2 million of the increase in right-of-use assets and operating lease liabilities. All of our facilities are leased under operating leases, which expire at various times through 2028, with a weighted-average remaining lease term of 4.6 years and a weighted-average discount rate of 5.3% as of July 3, 2021.

We recorded fixed operating lease expenses of $2.0 million and $1.9 million for the second quarter of fiscal 2021 and 2020, respectively, and $3.9 and $3.8 million for the first six months of fiscal 2021 and 2020, respectively.

The following table presents the lease balance classifications within the Consolidated Balance Sheets and summarizes their activity during the first six months of fiscal 2021:

Operating lease right-of-use assets	(in thousands)
Balance as of January 2, 2021	$	22,178
Right-of-use assets obtained for new and modified lease contracts during the period		7,459
Amortization of right-of-use assets during the period		(3,291	)
Adjustments for present value and foreign currency effects		84
Balance as of July 3, 2021	$	26,430

Operating lease liabilities	(in thousands)
Balance as of January 2, 2021	$	23,055
Lease liabilities incurred for new lease contracts during the period		7,459
Accretion of lease liabilities		657
Operating cash used by payments on lease liabilities		(3,984	)
Adjustments for present value and foreign currency effects		81
Balance as of July 3, 2021		27,268
Less: Current portion of operating lease liabilities (included in Accrued expenses)		(4,811	)
Long-term operating lease liabilities, net of current portion	$	22,457

Maturities of operating lease liabilities as of July 3, 2021 are as follows:

Fiscal year	(in thousands)
2021 (remaining 2 quarters)	$	2,564
2022		7,133
2023		7,189
2024		5,881
2025		3,664
Thereafter		4,614
Total lease payments		31,045
Less: amount representing interest		(3,777	)
Total lease liabilities	$	27,268

Lease obligations for facilities restructured prior to the adoption of Topic 842 totaled approximately $7.7 million at July 3, 2021 and continued to be recorded in Other long-term liabilities on our Consolidated Balance Sheets.