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Note 11 - Leases

9 Months Ended

Sep. 27, 2025

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 recognize 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 32 years, some of which include one or more options to extend the lease for up to 25 years. Our lease terms include renewal terms when we are reasonably certain that 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	September 27, 2025			December 28, 2024
Assets
Operating lease assets	Operating lease right-of-use assets⁽¹⁾	$	30,699		$	13,908
Finance lease assets	Property, plant and equipment, net ⁽²⁾		80			9,676
Total lease assets		$	30,779		$	23,584
Liabilities
Current
Operating	Other accrued liabilities	$	3,844		$	5,296
Finance	Other accrued liabilities⁽²⁾		-			8,418
Noncurrent
Operating	Long-term lease liabilities⁽¹⁾		32,059			9,890
Finance	Long-term lease liabilities		-			3
Total lease liabilities		$	35,903		$	23,607

Weighted-average remaining lease term (years)
Operating leases			9.0			5.2
Finance leases			0.6			-

Weighted-average discount rate
Operating leases			6.4	%		6.4	%
Finance leases			0.0	%		2.8	%

(1)	In June 2025, we gained access to our new corporate headquarters located in San Diego, California enabling us to make certain preparations for our planned relocation on January 1, 2026, resulting in an increase to our operating lease asset and long term operating lease liability.

(2)	Finance lease assets are recorded net of accumulated amortization of $0.4 million as of September 27, 2025, and December 28, 2024. On December 30, 2024 we completed the purchase of our leased facility in Melaka, Malaysia resulting in a decrease to our finance lease asset and liability.

The components of lease expense were as follows:

	Three Months Ended				Nine Months Ended
(in thousands)	September 27, 2025		September 28, 2024		September 27, 2025		September 28, 2024
Operating leases	$	2,429	$	1,529	$	5,449	$	4,710
Variable lease expense		654		577		1,950		1,724
Short-term operating leases		18		1		47		3
Finance leases
Amortization of leased assets		10		27		51		70
Interest on lease liabilities		-		67		1		200
Sublease income		-		-		-		(4	)
Net lease cost	$	3,111	$	2,201	$	7,498	$	6,703

Future minimum lease payments on September 27, 2025, are as follows:

	Operating			Finance
(in thousands)	leases			leases		Total
2025 ⁽¹⁾	$	1,665		$	-	$	1,665
2026 ⁽¹⁾		6,029			-		6,029
2027 ⁽¹⁾		5,150			-		5,150
2028 ⁽¹⁾		4,267			-		4,267
2029 ⁽¹⁾		4,626			-		4,626
Thereafter ⁽¹⁾		27,464			-		27,464
Total lease payments		49,201			-		49,201
Less: Interest		(13,298	)		-		(13,298	)
Present value of lease liabilities	$	35,903		$	-	$	35,903

(1)

In June 2025, we gained access to our new corporate headquarters located in San Diego, California enabling us to make certain preparations for our relocation on January 1, 2026. The new lease will result in cash outflows totaling $34.9 million expected to be paid as follows: $2.5 million, $3.0 million, $2.6 million, $3.0 million and $23.8 million for 2026, 2027, 2028, 2029 and thereafter, respectively.

Supplemental cash flow information related to leases was as follows:

	Nine Months Ended
(in thousands)	September 27, 2025		September 28, 2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	4,690	$	4,851
Operating cash flows from finance leases	$	-	$	195
Financing cash flows from finance leases	$	7	$	18
Leased assets obtained in exchange for new finance lease liabilities	$	-	$	9,543
Leased assets obtained in exchange for new operating lease liabilities	$	21,854	$	1,623