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Note 13 - Leases

12 Months Ended

Sep. 30, 2023

(13) Leases

We have operating leases for certain equipment, office space and vehicles. We determine whether an arrangement is a lease at its inception if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Leases with an initial term of twelve months or less are not recorded on our consolidated balance sheet. Lease expense for operating leases with original terms of more than twelve months was $1.3 million in 2023, $1.4 million in 2022 and $1.4 million in 2021.

Most of our leases include options to extend or terminate the leases which are exercised at our sole discretion. As most of our leases do not provide an implicit interest rate, we use our incremental borrowing rate as of the commencement date in determining the present value of lease payments, which represents an estimate of the interest rate we would incur at the lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term.

Supplemental cash flow and non-cash information related to leases is as follows:

(In thousands)	September 30, 2023		October 1, 2022
Cash paid for operating leases included in operating cash flows	$	1,261	$	1,418
Right-of-use assets obtained in exchange for new lease obligations		1,547		1,206

Supplemental balance sheet information related to leases is as follows:

(In thousands)	September 30, 2023		October 1, 2022
Right-of-use assets:
Other assets	$	1,939	$	1,565

Lease liabilities:
Accrued expenses	$	999	$	997
Other liabilities		936		572
Total operating lease liabilities	$	1,935	$	1,569

The weighted average remaining lease terms and discount rates for operating leases are as follows:

	September 30, 2023			October 1, 2022
Weighted average lease term (in years)	2.2			1.7
Weighted average discount rate		7.1	%		3.7	%

Aggregate future operating lease payments as of September 30, 2023, are as follows:

(In thousands)
2024	$	1,103
2025		636
2026		354
2027		6
2028		-
Total future operating lease payments		2,099
Less: imputed interest		(164	)
Present value of lease liabilities	$	1,935