Based upon the criteria set forth in ASC 810, Consolidation, the Company consolidates variable interest entities (“VIEs”) in which it has a controlling financial interest and is therefore deemed the primary beneficiary. A controlling financial interest will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact economic performance; and (b) the obligation to absorb the VIE losses and the right to receive benefits that are significant to the VIE. The Company has determined that it was the primary beneficiary of one VIE as of January 28, 2024 and January 29, 2023.

The Company leases the Company’s headquarters in Mt. Horeb, Wisconsin from TRI. In conjunction with the lease, the Company originally invested $6.3 million in a trust that loaned funds to TRI for the construction of the Company’s headquarters. TRI is a Wisconsin limited liability company whose primary purpose and activity is to own this real property. The Company considers itself the primary beneficiary for TRI as the Company has both the power to direct the activities that most significantly impact the entity’s economic performance and is expected to receive benefits that are significant to TRI. As the Company is the primary beneficiary, it consolidates TRI and the lease is eliminated in consolidation. The Company does not consolidate the trust as the Company is not the primary beneficiary.

The Consolidated Balance Sheets include the following amounts as a result of the consolidation of TRI as of January 28, 2024 and January 29, 2023.


	January 28, 2024		January 29, 2023
(in thousands)
Cash	$	17	$	20
Property and equipment, net		22,941		23,612
Total assets	$	22,958	$	23,632

Other current liabilities	$	26	$	161
Current maturities of TRI long-term debt		847		768
TRI long-term debt		25,141		25,913
Noncontrolling interest in VIE		(3,056)		(3,210)
Total liabilities and shareholders' equity	$	22,958	$	23,632

While the Balance Sheet is consolidated in accordance with ASC Topic 810, Consolidation, the Company is not the guarantor nor the obligor of the TRI debt.