Leases

12 Months Ended

Jan. 02, 2021

10. Leases

The Company leases certain manufacturing plants, warehouses, offices, machinery and equipment, and farmland. The Company subleases farmland to third-party growers. At the lease commencement date, the Company classifies a lease as a finance lease if it has the right to obtain substantially all of the economic benefits from the right-of-use assets, otherwise the lease is classified as an operating lease. The Company's leases have remaining noncancelable lease terms of less than one year to approximately ten years, and typically require fixed monthly rental payments that may be adjusted annually to give effect to inflation. Real estate leases typically include options to extend the leases for up to ten years. Machinery and equipment operating leases typically include purchase options for the fair market value of the underlying asset at the end of the lease term. Certain other leases for machinery and equipment include nominal purchase options at the end of the lease term that are reasonably certain of being exercised.

The following tables present supplemental information related to leases:

	January 2, 2021		December 28, 2019
	$		$
Lease Costs
Operating lease cost	16,647		18,192
Finance lease cost:
Depreciation of right-of-use assets	2,647		1,439
Interest on lease liabilities	675		267
Sublease income	(504	)	(476	)
Net lease cost	19,465		19,422

	January 2, 2021		December 28, 2019
	$		$
Balance Sheet Classification
Operating leases:
Operating lease right-of-use assets	35,172		65,939

Current portion of operating lease liabilities	12,750		16,084
Operating lease liabilities	24,582		50,657
Total operating lease liabilities	37,332		66,741

Finance leases:
Property, plant and equipment, gross	24,534		18,870
Accumulated depreciation	(5,787	)	(3,136	)
Property, plant and equipment, net	18,747		15,734

Current portion of long-term debt	3,146		2,493
Long-term debt	15,667		13,730
Total finance lease liabilities	18,813		16,223

	January 2, 2021		December 28, 2019
	$		$
Cash Flow Information
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	16,741		18,405
Operating cash flows from finance leases	675		267
Financing cash flows from finance leases	2,587		1,123

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	5,962		2,760
Finance leases	5,179		14,549

Termination of operating lease right-of-use assets and lease liabilities ⁽¹⁾	(23,667	)	—
Impairment of operating lease right-of-use assets⁽²⁾	(1,538	)	—

(1) Reflects the Company's exit from its leased Santa Maria, California, frozen fruit processing facility effective February 1, 2020 (see note 5).

(2) Reflects the impairment of operating lease right-of-use equipment assets related to one of two roasting lines at the Company's Crookston, Minnesota, facility, due to the consolidation of production into a single line, as well as the impairment of operating lease right-of-use real estate assets related to the Company's corporate office consolidation.

	January 2, 2021		December 28, 2019
Other Information
Weighted-average remaining lease term (years):
Operating leases	3.4		6.1
Finance leases	5.3		5.9

Weighted-average discount rate:
Operating leases	6.6	%	9.2	%
Finance leases	5.4	%	4.5	%

	Operating leases		Finance leases
	$		$
Maturities of Lease Liabilities
2021	13,084		4,089
2022	11,057		4,294
2023	7,038		3,697
2024	5,147		3,578
2025	3,042		4,272
Thereafter	3,613		1,839
Total lease payments	42,981		21,769
Less: imputed interest	(5,649	)	(2,956	)
Total lease liabilities	37,332		18,813

The Company has commitments under certain master lease agreements that provide for up to approximately $45 million of financing in the aggregate related to the addition of new plant-based beverage and ingredient extraction processing and packaging equipment. As at January 2, 2021, approximately $40 million of the related finance leases had not commenced, and no amount of right-of-use assets, or lease liabilities, were recognized related to these leases on the consolidated balance sheet as of that date.