LEASES

3 Months Ended

Apr. 05, 2025

The Company's leases consist primarily of retail space, offices, warehouses, distribution centers, equipment and vehicles. The Company determines if an agreement contains a lease at inception based on the Company's right to the economic benefits of the leased assets and its right to direct the use of the leased asset. ROU assets represent the Company's right to use an underlying asset, and ROU liabilities represent the Company's obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at the commencement date adjusted for the lease term and lease country to determine the present value of the lease payments.

Some leases include one or more options to renew at the Company's discretion, with renewal terms that can extend the lease from approximately one to ten additional years. The renewal options are not included in the measurement of ROU assets

and ROU liabilities unless the Company is reasonably certain to exercise the optional renewal periods. Short-term leases are leases having a term of twelve months or less at inception. The Company does not record a related lease asset or liability for short-term leases. The Company has certain leases containing lease and non-lease components which are accounted for as a single lease component. The Company has certain lease agreements where lease payments are based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The variable portion of these lease payments is not included in the Company's lease liabilities. The Company's lease agreements do not contain any significant restrictions or covenants other than those that are customary in such arrangements.

The components of lease expense were as follows (in thousands):


Lease Cost	Condensed Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) Location	For the 14 Weeks Ended April 5, 2025		For the 13 Weeks Ended March 30, 2024
Operating lease cost(1)	SG&A	$	14,705	$	16,309



Short-term lease cost	SG&A	$	166	$	286
Variable lease cost	SG&A	$	3,801	$	5,353

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(1) Includes sublease income, which was immaterial.

The following table discloses supplemental balance sheet information for the Company’s leases (in thousands):


Leases	Condensed Consolidated Balance Sheets Location	April 5, 2025		December 28, 2024
Assets
Operating	Operating lease ROU assets	$	117,270	$	121,389


Liabilities
Current:
Operating	Current operating lease liabilities	$	32,935	$	37,327

Noncurrent:
Operating	Long-term operating lease liabilities	$	109,775	$	113,658

The following table discloses the weighted-average remaining lease term and weighted-average discount rate for the Company's leases:

Lease Term and Discount Rate

April 5, 2025

December 28, 2024

Weighted-average remaining lease term:

Operating leases

6.4 years

6.3 years

Weighted-average discount rate:

Operating leases

15.2

15.1

Future minimum lease payments by year as of April 5, 2025 were as follows (in thousands):


Fiscal Year	Operating Leases
2025 (remaining)	$	42,879
2026	45,928
2027	31,820
2028	19,593
2029	18,101
Thereafter	72,335

Total lease payments	$	230,656
Less: Interest	87,946
Total lease obligations	$	142,710

Supplemental cash flow information related to leases was as follows (in thousands):


	For the 14 Weeks Ended April 5, 2025		For the 13 Weeks Ended March 30, 2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	19,381	$	19,937



Leased assets obtained in exchange for new operating lease liabilities	3,551		4,288

As of April 5, 2025, the Company did not have any material operating or finance leases that have been signed but not commenced.