LEASES

3 Months Ended

Dec. 30, 2022

The Company leases certain facilities and machinery and equipment under long-term, non-cancelable operating leases. The Company determines if an arrangement is a lease at inception.

As of December 30, 2022, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 16 years. Some of the leases contain variable payment terms, such as payments based on fluctuations in the Consumer Price Index (CPI). Some leases also contain options to extend or terminate the lease. To the extent the Company is reasonably certain to exercise these options, they have been considered in the calculation of the right-of-use ("ROU") assets and lease liabilities. Under current lease agreements, there are no residual value guarantees or restrictive lease covenants. In calculating the ROU assets and lease liabilities, several assumptions and judgments were made by the Company, including whether a contract is or contains a lease under the applicable definition, and the determination of the discount rate, which is assumed to be the incremental borrowing rate. The incremental borrowing rate is derived from information available to the Company at the lease commencement date based on lease length and location.

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three months ended December 30, 2022 and December 31, 2021 were as follows:


	Three months ended
	December 30, 2022		December 31, 2021
Lease Cost
Operating lease costs	$	2,430	$	2,107
Short-term lease costs	529		414
Variable lease costs	41		45
Total lease cost	$	3,000	$	2,566

Included in the amounts in the table above were rent expense to related parties of $314 and $291 for the three months ended December 30, 2022 and December 31, 2021, respectively.

As of December 30, 2022, the Company did not have any finance leases or sublease agreements. Additionally, the Company does not have any leases in which it is the lessor. While the Company extended or renewed various existing leases during the quarter, there were no significant new leases entered into during the quarter ended December 30, 2022. As of December 30, 2022, the Company did not have any significant operating lease commitments that have not yet commenced. Supplemental balance sheet, cash flow, and other information related to operating leases was as follows:


	Three months ended
	December 30, 2022			December 31, 2021
Operating leases:

Operating lease ROU assets	$	55,647		$	47,443

Current operating lease liabilities	7,510			5,646
Non-current operating lease liabilities	49,519			42,817
Total operating lease liabilities	$	57,029		$	48,463

Weighted average remaining lease term (in years)	12.21			12.15

Weighted average discount rate	3.15		%	3.09		%

Cash paid for amounts included in the measurement of lease liabilities	$	2,149		$	1,875

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at December 30, 2022 were as follows:


Year	Related parties included in total		Total
Remainder of 2023	$	929	$	6,822
2024	1,270		8,166
2025	1,308		7,545
2026	1,348		5,878
2027	226		4,710
Thereafter	—		36,096
Total undiscounted lease payments	5,081		69,217
Less: Imputed interest	(155)		(12,188)
Total net lease liability	$	4,926	$	57,029