Note 17 - Leases and Lease Guarantees

12 Months Ended

Nov. 25, 2017

Notes to Financial Statements

Leases Lease Guarantees And Loan Guarantees [Text Block]

1

7.

Leases

and

Lease Guarantees

Lease

s

We lease land and buildings that are used in the operation of our Company-owned retail stores as well as in the operation of

certain of our licensee-owned stores, and we lease land and buildings at various locations throughout the continental United States for warehousing and distribution hubs used in our logistical services segment. We also lease tractors, trailers and local delivery trucks used in our logistical services segment. Our real estate lease terms range from

one

to

15

years and generally have renewal options of between

five

and

15

years. Some store leases contain contingent rental provisions based upon sales volume. Our transportation equipment leases have terms ranging from

two

to

seven

years with fixed monthly rental payments plus variable charges based upon mileage. The following schedule shows future minimum lease payments under non-cancellable operating leases with terms in excess of

one

year as of

November 25, 2017:

	Retail Stores		Distribution Centers		Transportation Equipment		Total
Fiscal 2018	$	22,426	$	4,127	$	2,999	$	29,552
Fiscal 2019		22,541		2,735		2,367		27,643
Fiscal 2020		21,072		1,960		2,104		25,136
Fiscal 2021		18,212		1,545		1,169		20,926
Fiscal 2022		15,424		1,520		963		17,907
Thereafter		50,743		1,776		254		52,773
Total future minimum lease payments	$	150,418	$	13,663	$	9,856	$	173,937

Lease expense was

$34,372,

$31,867

and

$26,382

for

2017,

2016,

and

2015,

respectively. Lease expense for leases with escalating minimum payments over the lease term is recognized on a straight-line basis. Our liability for accrued straight-line rent expense was

$4,821

and

$3,708

 at

November 25, 2017

and

November 26, 2016,

respectively, and is included in other accrued liabilities in our consolidated balance sheets.

In addition to subleasing certain of these properties, we own retail real estate which we in turn lease to licensee operators of

BHF stores. We also own real estate for closed stores which we lease to non-licensees. The following schedule shows minimum future rental income related to pass-through rental expense on subleased property as well as rental income on real estate owned by Bassett.

Fiscal 2018	$	1,653
Fiscal 2019		1,669
Fiscal 2020		1,616
Fiscal 2021		781
Fiscal 2022		422
Thereafter		106
Total minimum future rental income	$	6,247

Real estate

rental net loss (rental income less lease costs, depreciation, insurance, and taxes), related to licensee stores and other investment real estate, was

$48,

$59

and

$181

in

2017,

2016

and

2015,

respectively, and is reflected in other loss, net in the accompanying consolidated statements of income.

Guarantees

As part of the strategy for our

store program, we have guaranteed certain lease obligations of licensee operators. Lease guarantees range from

one

to

three

years. We were contingently liable under licensee lease obligation guarantees in the amount of

$2,743

and

$1,868

at

November 25, 2017

and

November 26, 2016,

respectively.

In the event of default by an independent dealer under the guaranteed lease, we believe that the risk of loss is mitigated through a combination of options that include, but are

not

limited to, arranging for a replacement dealer, liquidating the collateral, and pursuing payment under the personal guarantees of the independent dealer. The proceeds of the above options are estimated to cover the maximum amount of our future payments under the guarantee obligations

, net of reserves. The fair value of lease guarantees (an estimate of the cost to the Company to perform on these guarantees) at

November 25, 2017

and

November 26, 2016,

were

not

material.