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Note 6 - Leases

3 Months Ended

Apr. 03, 2022

Lessee, Operating and Finance Leases [Text Block]

Note 6 — Leases

The Company entered into operating leases for office space for its headquarters. The Company has elected the practical expedient to apply to recognition requirements to short-term leases for its domestic and foreign subsidiaries and for its sales offices and recognized rent payments on short-term leases on a straight-line basis over the lease term. Finance leases are primarily for engineering design software. Operating leases generally have lease terms of one to five years. Finance leases are generally two to three years. As of April 3, 2022 and January 2, 2022 the balance of right-of-use assets was approximately $1.3 million and $1.5 million, respectively, and the lease liability was approximately $1.4 million and $1.6 million, respectively, for operating and finance leases for the headquarters in San Jose and for the operating subsidiaries of SensiML in Oregon and the Company's subsidiary in India. Total rent expense was $0.1 million for the three months ended April 3, 2022 and April 4, 2021.

The following table provides the expenses related to operating and finance leases (in thousands):

	*Three Months Ended*
	*April 3, 2022*		*April 4, 2021*
Operating lease costs:
Fixed	$	100	$	103
Short term		6		4
Total	$	106	$	107
Finance lease costs:
Amortization of ROU asset	$	109	$	98
Interest		7		7
Total	$	116	$	105

The following table provides the details of supplemental cash flow information. Right-of-use assets obtained in exchange for new finance and operating lease liabilities represent the new operating and finance leases entered into during the three months ended April 3, 2022 and April 4, 2021 were $0.

	Three Months Ended
	April 3, 2022		April 4, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used for operating leases	$	100	$	102
Operating cash flows used for finance leases		7		8
Financing cash flows used for financing leases		98		43
Total	$	205	$	153

The following table provides the details of right-of-use assets and lease liabilities as of April 3, 2022 and January 2, 2022 (in thousands):

	April 3, 2022		January 2, 2022
Right-of-use assets:
Operating leases	$	725	$	809
Finance leases		611		720
Total right-of-use assets	$	1,336	$	1,529
Lease liabilities:
Operating leases	$	786	$	873
Finance leases		591		690
Total lease liabilities	$	1,377	$	1,563

The following table provided the details of future lease payments for operating and finance leases as of April 3, 2022 (in thousands):

	*Operating Leases*			*Finance Leases*
2022 (remaining period)	$	309		$	370
2023		422			141
2024		106			105
Total lease payments		837			616
Less: Interest		(51	)		(25	)
Present value of lease liabilities	$	786		$	591

The following table provides the details of lease terms and discount rates as of April 3, 2022 and January 2, 2022:

	April 3, 2022			January 2, 2022
Right-of-use assets:
Weighted-average remaining lease term (years)
Operating leases		2.00			2.25
Finance leases		1.98			2.15
Weighted-average discount rates:
Operating leases		6.00	%		6.00	%
Finance leases		4.51	%		4.57	%