LEASED ASSETS

6 Months Ended

Jun. 27, 2020

NOTE 5 — LEASED ASSETS

The Company leases certain of its real estate and equipment. The Company has evaluated all its leases and determined that all are operating leases under the definitions of the guidance of ASU 2016-02. The Company’s lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants.

The Company adopted the provisions of ASU 2016-02 using the effective date method on January 1, 2019 and recorded right-of-use assets equal to the present value of the contractual liability for future lease payments. The table below presents the right-of-use assets and related lease liabilities recognized on the Condensed Consolidated Balance Sheet as of June 27, 2020:

	Balance Sheet Line Item	June 27, 2020
Right-of-use assets	Other assets	$2,361
Operating lease liabilities
Current portion	Trade accounts payable and accrued expenses	$440

Noncurrent portion	Lease liabilities	1,953
Total operating lease liabilities		$2,393

The depreciable lives of right-of-use assets are limited by the lease term and are amortized on a straight line basis over the life of the lease.

Index

The Company’s leases generally do not provide an implicit interest rate, and therefore the Company uses its incremental borrowing rate enumerated in its revolving line of credit (see Note 6) to determine the present value of its operating lease liabilities. The following table reconciles the undiscounted future minimum lease payments to the total operating lease liabilities recognized on the Condensed Consolidated Balance Sheet as of June 27, 2020:

Remainder of 2020	$277
2021	559
2022	244
2023	213
2024	215
Thereafter	1,600
Total undiscounted future minimum lease payments	3,108
Less: Difference between undiscounted lease payments & the present value of future lease payments	(715)
Total operating lease liabilities	$2,393

Certain of the Company’s lease agreements contain renewal options at the Company’s discretion. The Company does not recognize right-of-use assets or lease liabilities for leases of one year or less or for renewal periods unless it is reasonably certain that the Company will exercise the renewal option at the inception of the lease or when a triggering event occurs. The Company’s weighted average remaining lease term for operating leases as of June 27, 2020 is 11.45 years.