10. LEASES

The Company enters into a variety of operating lease agreements through the normal course of its business, but primarily real estate leases to support its operations. The Company leases properties located in Portland, Maine, Lewiston, Maine, Gorham, Maine, Nashua, New Hampshire and Hamburg, Germany. The real estate lease agreements generally provide for fixed minimum rental payments and the payment of real estate taxes and insurance. The Company has lease terms that expire between November 2026 through February 2037.

Certain of these leases also include renewal options at the election of the Company to renew or extend the lease for an additional four to five years. These optional periods have not been considered in the determination of the right-of-use assets or lease liabilities associated with these leases as the Company did not consider it reasonably certain it would exercise the options.

The Company also enters into leases for equipment and service agreements, and other leases related to its manufacturing operations that are classified as finance leases that are not material.

The following table summarizes supplemental balance sheet information related to the Company’s operating leases:

For the three months ended April 3, 2026 and March 31, 2025, the Company recognized approximately $0.4 million and $0.5 million of lease expense, respectively, which was recognized within cost of goods sold on the consolidated statements of operations. Variable and short-term lease expense recognized during the three months ended April 3, 2026 and March 31, 2025 were not material.

As of April 3, 2026, maturities of operating lease liabilities were as follows:

Supplemental cash flow related to the Company’s operating leases were as follows:

As of April 3, 2026 and December 31, 2025, the Company did not have any leases that had not yet commenced.