Accounts and note receivable

9 Months Ended

Feb. 23, 2025

Accounts receivable

Two of the Company’s customers had accounts receivable concentrations of 10% or greater as of February 23, 2025, accounting for 47% and 19% of accounts receivable. Two of the Company’s customers had accounts receivable concentrations of 10% or greater as of May 26, 2024, accounting for 34% and 18% of accounts receivable.

Changes in the allowance for credit losses related to accounts receivable are as follows:


	Nine months ended
	February 23, 2025		February 25, 2024
Beginning balance	$	711	$	485
Provision	186		77
Charge-offs	—		(37)
Balance at February 23, 2025	$	897	$	525

Factors that are currently influencing our estimate of expected credit losses includes knowledge of certain customers whose development projects are awaiting additional funding.

Note receivable

On January 7, 2025, the Company accepted a $10,000 note as a portion of the proceeds for the sale of the isolator-filler described in note 6. The note matures on July 7, 2026 and may be paid in whole or in part at any time prior to maturity without penalty or premium. Otherwise, the note is scheduled to be paid as follows: $4,000 on July 7, 2025, $4,000 on January 7, 2026 and $2,000 on July 7, 2026.

The note is interest-free through July 7, 2025 and thereafter principal bears interest at the U.S. prime rate plus 1% until repayment. Management concluded that interest should be imputed for the full duration of the note at an effective interest rate of 8.5%, representing the stated rate as of February 23, 2025. As a result, the Company recorded an initial discount of $410 as an offset to the noncurrent portion of the note based on its maturity date.

As of February 23, 2025, the note receivable of $10,000, net of discount of $305, is classified on our balance sheet as follows: $8,000 as a standalone current asset and $1,695 as a component of other assets. Interest income of $105 is included on our statement of operations within interest expense, net.