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Note 9 - Capital Lease | 9 Months Ended
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Feb. 28, 2016
Notes to Financial Statements |
Capital Leases in Financial Statements of Lessee Disclosure [Text Block] |
9. | Capital Lease
On September 3, 2015, Lifecore leased a 65,000 square foot building in Chaska, MN, approximately two miles from its current facility. The initial term of the lease is seven years with two five-year renewal options. The lease contains a buyout option at any time after year seven with the purchase price equal to then mortgage balance on the lessor’s loan secured by the building. The lease is a capital lease. Included in property, plant and equipment as of February 28, 2016 is $3.8 million associated with this capital lease. The monthly lease payment is initially $34,000 and increases by 2.4% per year. Lifecore and the lessor made capital improvements prior to occupancy and thus the lease did not become effective until January 1, 2016. Lifecore initially will use the building for warehousing and final packaging. Future minimum lease payments under this capital lease for each year presented as are follows (in thousands):
FY 2016 |  | $ | 101 |
FY 2017 |  |  | 408 |
FY 2018 |  |  | 418 |
FY 2019 |  |  | 428 |
FY 2020 |  |  | 438 |
FY 2021 |  |  | 449 |
Thereafter |  |  | 3,951 |
Total minimum lease payment |  |  | 6,193 |
Less: amounts representing interest |  |  | (2,454 | )
Total |  |  | 3,739 |
Less current portion included in other accrued liabilities |  |  | (28) |
Long-term capital lease obligation |  | $ | 3,711 |

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- Definition The entire disclosure for capital leasing arrangements including, but not limited to, the following: a) the basis on which contingent rental payments are determined; (b) the existence and terms of renewal or purchase options and escalation clauses; (c) restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -SubTopic 30 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6455398&loc=d3e45280-112737 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6452660&loc=d3e36991-112694 + Details
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