Note N - Lease Liabilities

3 Months Ended

Sep. 26, 2025

Notes to Financial Statements

Lessee, Operating and Finance Leases [Text Block]

N. Lease Liabilities

The Company leases certain office and warehouse space, as well as production and office equipment.

The Company determines if an arrangement is a lease at contract inception. The lease term begins upon lease commencement, which is when the Company takes possession of the asset, and may include options to extend or terminate the lease when it is reasonably certain that such options will be exercised. As its lease agreements typically do not provide an implicit rate, the Company primarily uses an incremental borrowing rate based upon the information available at lease commencement. In determining the incremental borrowing rate, the Company considers its current borrowing rate, the term of the lease, and the economic environments where the lease activity is concentrated. Some of the Company’s leases contain non-lease components (e.g., common area, other maintenance costs, etc.) that relate to the lease components of the agreement. Non-lease components and the lease components to which they relate are accounted for as a single lease component.

The following table provides a summary of leases recorded on the condensed consolidated balance sheets.

	Condensed Consolidated Balance Sheets Location	September 26, 2025		June 30, 2025
Lease Assets
Right-of-use operating lease assets	Right-of-use operating lease assets	$	16,311	$	17,250
Right-of-use finance lease assets	Property, plant and equipment, net		5,535		5,794
Lease Liabilities
Right-of-use operating lease liabilities, current	Current maturities of right-of-use operating lease obligations	$	3,336	$	3,393
Right-of-use operating lease liabilities, non-current	Right-of-use lease obiligations		13,474		14,357
Right-of-use finance lease liabilities, current	Accrued liabilities		1,063		1,014
Right-of-use finance lease liabilities, non-current	Other long-term liabilities	$	4,975	$	5,212

The components of lease expense were as follows:

	For the Quarter Ended
	September 26, 2025			September 27, 2024
Finance lease cost:
Amortization of right-of-use assets	$	281		$	232
Interest on lease liabilities		105			94
Operating lease cost		1,073			939
Short-term lease cost		84			11
Variable lease cost		133			100
Total lease cost		1,676			1,376
Less: Sublease income		(26	)		(21	)
Net lease cost	$	1,650		$	1,355

Other information related to leases was as follows:

	For the Quarter Ended
	September 26, 2025			September 27, 2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	1,240		$	1,013
Operating cash flows from finance leases		106			95
Financing cash flows from finance leases		284			546
Right-of-use-assets obtained in exchange for lease obligations:
Operating leases		50			330
Finance leases		47			508
Weighted average remaining lease term (years):
Operating leases		7.2			8.5
Finance lease		7.0			8.4
Weighted average discount rate:
Operating leases		8.5	%		8.4	%
Finance leases		6.7	%		6.5	%

Approximate future minimum rental commitments under non-cancellable leases as of September 26, 2025 were as follows:         

	Operating Leases			Finance Leases
2026	$	3,336		$	1,063
2027		4,042			1,374
2028		2,782			1,264
2029		2,369			874
2030		1,919			557
2031		1,840			497
Thereafter		6,521			1,753
Total future lease payments		22,809			7,382
Less: Amount representing interest		(5,999	)		(1,344	)
Present value of future payments	$	16,810		$	6,038