LEASES

3 Months Ended

Dec. 29, 2023

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 29, 2023, 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 29, 2023 and December 30, 2022 were as follows:


	Three months ended
	December 29, 2023		December 30, 2022
Lease Cost
Operating lease costs	$	2,465	$	2,430
Short-term lease costs	627		529
Variable lease costs	43		41
Total lease cost	$	3,135	$	3,000

Included in the amounts in the table above was rent expense to related parties of $314 and $314 for the three months ended December 29, 2023 and December 30, 2022, respectively.

As of December 29, 2023, 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 29, 2023. As of December 29, 2023, 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 29, 2023			December 30, 2022
Operating leases:

Operating lease ROU assets	$	51,852		$	55,647

Current operating lease liabilities	7,284			7,510
Non-current operating lease liabilities	46,239			49,519
Total operating lease liabilities	$	53,523		$	57,029

Weighted average remaining lease term (in years)	11.50			12.21

Weighted average discount rate	3.19		%	3.15		%

Cash paid for amounts included in the measurement of lease liabilities	$	2,268		$	2,149

ROU assets obtained in exchange for lease liabilities	$	2,061		$	1,941

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at December 29, 2023 were as follows:


Year	Related parties included in total		Total
Remainder of 2024	$	957	$	6,778
2025	1,308		8,518
2026	1,348		7,286
2027	226		5,789
2028	—		3,823
Thereafter	—		32,580
Total undiscounted lease payments	3,839		64,774
Less: Imputed interest	(87)		(11,251)
Total net lease liability	$	3,752	$	53,523