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Commitments and Contingencies | 6 Months Ended
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Jul. 04, 2026
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies | Commitments and Contingencies Regulatory Matters Government and regulatory agencies may have the ability to conduct routine audits and periodic examinations of, and administrative proceedings regarding, the Company’s business operations. As previously disclosed, U.S. Customs gathered initial information from the Company under routine audit procedures, and the information indicated that the Company potentially underpaid import duties in prior periods arising from certain classification discrepancies for products imported into the United States as separately entered shipments. In working with U.S. Customs, the Company has exercised reasonable care to address this matter in an equitable and expeditious manner through the filing of a prior disclosure submission with U.S. Customs. As of July 4, 2026 and January 3, 2026, the Company estimated that it will be required to pay approximately $8.0 million, excluding any interest. This amount is reflected in Other current liabilities on the Company’s consolidated balance sheets as of July 4, 2026 and January 3, 2026. See Note 3, Inventory, to these unaudited consolidated financial statements for disclosure concerning another matter related to import duties. In addition, as previously disclosed in prior reporting periods, U.S. Customs issued proposed notices of action to the Company, asking for confirmation that certain plywood products the Company imported into the United States originated from Vietnam as opposed to China. The Company responded to U.S. Customs, and, having reviewed the information provided by the Company, has closed the proposed notice of action signaling the Company’s responsibility in the matter has been satisfied and further action is not required. Matters Regarding Certain Tariffs on Imported Goods On February 20, 2026, a U.S. Supreme Court ruling invalidated tariffs imposed under the International Emergency Economic Powers Act ("IEEPA") that were not authorized by the U.S. Congress. On April 20, 2026, U.S. Customs disclosed a process to facilitate a phased approach for processing IEEPA tariff refunds. For any potential refunds that may be due to the Company as a result of the February 20, 2026 ruling from the U.S. Supreme Court for tariffs levied under IEEPA, the Company’s current accounting policy is to account for any such tariff refunds by applying the gain contingency accounting model. Accordingly, the Company will recognize any IEEPA tariff refund when it becomes realized or realizable. The Company began receiving IEEPA cash refunds during Q2 2026 for tariffs the Company paid in 2025 and early 2026, and through July 4, 2026 the Company has received IEEPA cash refunds of $7.2 million. This amount is reflected as a reduction of Cost of products sold on the Company’s consolidated statements of operations for Q2 2026 and the YTD 2026 period since substantially all of the related inventory has been sold as of that date. Uncertainty continues to exist regarding current and future tariffs. Following the U.S. Supreme Court ruling of February 20, 2026, the U.S. government imposed separate tariffs prospectively under the Trade Act of 1974, which were subsequently struck down by an order of the U.S. Court of International Trade (“CIT”). This CIT order has been appealed by the executive branch of the U.S. government. Environmental Matters From time to time, the Company may be involved in proceedings involving various environmental and pollution control laws and regulations in the jurisdictions in which it operates. When the Company believes it has material financial exposure to these matters, it estimates and recognizes adequate liabilities and, if applicable, also timely records any expected recoveries from insurance coverages or subrogation in accordance with GAAP. Such liabilities, when recorded, may or may not be discounted, as required or permitted by GAAP. Based on presently available information, the Company had no material obligations for environmental matters as of July 4, 2026 or January 3, 2026. Collective Bargaining Agreements Approximately 21% of the Company’s employees are represented by various local labor unions with terms and conditions of employment governed by collective bargaining agreements (“CBAs”). As of July 4, 2026 three CBA covering approximately 2.0 percent of the Company’s employees are up for renewal during the remainder of fiscal 2026.

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