ADAC-STRATTEC LLC, a Delaware limited liability company, was formed in fiscal year 2007 to support injection molding and door handle assembly operations in Mexico. For all periods presented in this report, ADAC-STRATTEC LLC was 51 percent owned by STRATTEC and 49 percent owned by ADAC Automotive (“ADAC”). ADAC, of Grand Rapids, Michigan, is a privately held automotive supplier and manufactures engineered products, including door handles and other automotive trim parts, utilizing plastic injection molding, automated painting and various assembly processes. An additional Mexican entity, ADAC-STRATTEC de Mexico, is wholly owned by ADAC-STRATTEC LLC. ADAC-STRATTEC LLC’s financial results are consolidated with the financial results of STRATTEC. ADAC-STRATTEC LLC net sales and net income to STRATTEC totaled approximately $135.9 million and $147,000, respectively, in 2024. ADAC-STRATTEC LLC net sales and net loss to STRATTEC totaled approximately $121.9 million and $2.1 million, respectively, in 2023.

ADAC charges ADAC STRATTEC LLC an engineering, research and design fee as well as a sales fee. Such fees are calculated as a percentage of net sales and are included in the consolidated results of STRATTEC. Additionally, ADAC-STRATTEC LLC sells production parts to ADAC. Sales to ADAC are included in the consolidated results of STRATTEC. The following table summarizes these related party transactions for the periods indicated below (in thousands):


	Years Ended
	June 30, 2024		July 2, 2023
Engineering, research and design fee charged to ADAC-STRATTEC LLC	$	9,511	$	8,533
Sales to ADAC	$	9,718	$	12,198


	Years Ended
	June 30, 2024		July 2, 2023
Accounts receivable due from ADAC	$	833	$	3,903
Accounts payable to ADAC	$	1,679	$	4,928

STRATTEC POWER ACCESS LLC (“SPA”) was formed in fiscal year 2009 to supply the North American portion of the power sliding door, lift gate, tail gate and deck lid system access control products which were acquired from Delphi Corporation. Prior to June 30, 2023, SPA was 80 percent owned by STRATTEC and 20 percent owned by WITTE. WITTE, of Velbert, Germany, is a privately held automotive supplier that designs, manufactures and markets automotive components, including locks and keys, hood latches, rear compartment latches, seat back latches, door handles and specialty fasteners. Effective June 30, 2023, we entered into and completed transactions contemplated by an Equity Restructuring Agreement ("Restructuring Agreement") between STRATTEC and WITTE. As a result, STRATTEC purchased the remaining 20 percent interest in SPA, and SPA became a wholly owned subsidiary of STRATTEC. The restructuring agreement is discussed further below. An additional Mexican entity, STRATTEC POWER ACCESS de Mexico, is wholly owned by SPA. The financial results of SPA are consolidated with the financial results of STRATTEC.

Prior to June 30, 2023, we participated in certain Alliance Agreements with WITTE and ADAC. Additionally, a joint venture company, Vehicle Access Systems Technology LLC (“VAST LLC”), in which WITTE, STRATTEC and ADAC each held a one-third equity interest, existed to seek opportunities to manufacture and sell each company’s products in areas of the world outside of North America and Europe. VAST LLC had investments in China, Brazil, and India with sales and engineering branch offices in South Korea and Japan. Due to these relationships, STRATTEC purchased $839,000 of component parts from WITTE in 2023. STRATTEC also paid WITTE a royalty of $528,000 in 2023 related to certain latch product sales. WITTE was no longer a related party as of June 30, 2023.

As a result of the Restructuring Agreement, STRATTEC sold its one-third interest in VAST LLC to WITTE and STRATTEC purchased WITTE's 20 percent non-controlling interest in SPA along with the net assets of VAST LLC's Korea branch office. The net purchase price payable from WITTE to STRATTEC was $18.5 million, of which $16.5 million was paid on June 30, 2023 and $2 million was paid in July 2023. The $2 million paid in July 2023 was included in other current assets in the accompanying Consolidated Balance Sheet as of July 2, 2023. The allocation of the $18.5 million net purchase price was as follows (millions of dollars):


	Cash Received (Paid)
Sale of STRATTEC's one-third ownership interest in VAST LLC	$	28.2
Purchase of 20 percent non-controlling interest in SPA		(9.0	)
Purchase of net assets of VAST LLC's Korean branch office		(0.7	)
Net purchase price received by STRATTEC	$	18.5

The Restructuring Agreement positions STRATTEC to redeploy assets, both financial and technical, to create greater focus on STRATTEC-specific strategic growth opportunities in North America and around the world. This transaction allows STRATTEC to be well-positioned to take advantage of new opportunities, including more of our product applications on Electric Vehicles, growing consumer demand for Power Access products, expansion of electronics capabilities and other new automotive products. It also gives us greater resources to further explore diversification of markets, complimentary technology and regions outside of North America. As part of the Restructuring Agreement, STRATTEC also entered into a cooperation framework agreement with WITTE related to VAST LLC which provides a framework for the parties to collaborate on global programs related to product development and manufacturing.

Prior to the Restructuring Agreement, VAST LLC investments were accounted for using the equity method of accounting. The activities of VAST LLC resulted in equity loss of joint ventures to STRATTEC of $331,000 during 2024, which loss was the result of additional professional fees incurred related to the Restructuring Agreement. The current year loss is an adjustment to our 2023 gain on sale of VAST LLC of $110,000. Our accumulated loss on sale of VAST LLC totals $221,000 as of June 30, 2024. The activities of VAST LLC resulted in equity earnings of joint ventures to STRATTEC of approximately $1.6 million during 2023. STRATTEC's 2023 equity earnings also includes STRATTEC's one-third share of a loss on disposal of Brazil, which totaled $531,000. During 2023, capital contributions totaling $834,000 were made to VAST LLC for purposes of funding operations in Brazil with STRATTEC's portion of such capital contributions totaling $278,000. As of June 30, 2023, STRATTEC had no continuing involvement in VAST LLC. See further discussion under Equity (Loss) Earnings of Joint Ventures included in Notes to Financial Statements herein.