Lessee ROU Assets and Lease Liabilities Lessee ROU Assets and Lease Liabilities

6 Months Ended

Jun. 27, 2020

Lessee, ROU Assets and Lease Liabilities

11. Lessee ROU Assets and Lease Liabilities

The Company leases certain facilities in North and South America, Europe, the Middle East and Asia-Pacific regions under operating lease agreements expiring at various dates through January 2030. In addition, the Company leases equipment in the U.S. and Europe that are classified as operating leases and expire at various dates through December 2023. The majority of these leases are non-cancellable and generally do not contain any material restrictive covenants, material residual value guarantees or other material guarantees. The Company recognizes lease costs under these agreements using a straight-line method based on total lease payments. Certain facility leases contain predetermined price escalations and in some cases renewal options, the longest of which is for five years.

The Company generally estimates the applicable discount rate used to determine the net present value of lease payments based on available information at the lease commencement date. As of June 27, 2020, the weighted-average discount rate used by the Company for all operating leases was approximately 2.8%.

The balance sheet classifications for amounts related to the Company’s operating leases for which it is the lessee are as follows (in thousands):



	Balance sheet classification	June 27, 2020		December 28, 2019
Lessee ROU assets	Other non-current assets	$	25,609	$	19,137

Lessee current lease liabilities	Other current liabilities	4,776		4,653
Lessee non-current lease liabilities	Other non-current liabilities	22,384		15,834
Total operating lease liabilities		$	27,160	$	20,487

The weighted-average remaining lease term for the Company’s operating leases was 8.0 years as of June 27, 2020.

As of June 27, 2020, estimated future operating lease payments for each of the following fiscal years were as follows (in thousands):



Fiscal year	Amount
2020 (balance of year)	$	2,863
2021	4,762
2022	3,694
2023	3,429
2024	2,863
Thereafter⁽¹⁾	12,885
Total	30,496
Imputed interest	(3,336		)
Present value	$	27,160

______________

⁽¹⁾ Includes optional renewal period for certain leases.

Lease costs consist of the following (in thousands):



	Three Months Ended					Six Months Ended
	June 27, 2020		June 29, 2019			June 27, 2020		June 29, 2019
Operating lease costs	$	1,732	$	1,688		$	3,390	$	3,453
Short-term lease costs	—		3			1		12
Sublease income	—		(52		)	—		(104		)
Total lease costs	$	1,732	$	1,639		$	3,391	$	3,361