Company: ATLN
Filing Date: 2025-01-23
Form Type: S-4/A
Source: 0001213900-25-006032
Chunk: 179

Company: ATLANTIC INTERNATIONAL CORP.
Filing Date: 2025-01-23
Form: S-4/A
Chunk 179
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 a taxable transaction for U.S. federal income tax purposes. Accounting Treatment Atlantic International prepares its financial statements in accordance with US GAAP. Excluding cash and cash equivalents, the net assets being acquired are comprised primarily of one asset class, marketable securities. Also, there are no inputs, processes, and outputs being acquired in the Merger. Accordingly, accounting guidance would require the Merger to be accounted for as an asset acquisition. However, since the Merger is taking place principally for capital -raisingpurposes, the Merger will be accounted for primarily as a capital -raisingtransaction with an asset acquisition component for the long -livedassets held by Staffing 360. Atlantic International would be considered the accounting acquirer of Staffing 360’s net assets under the provisions of ASC 805, Business Combinations, due to Atlantic International remaining in control of the combined entity after the Merger. The excess of the fair value of the net assets acquired over the fair value of the consideration transferred (representing the fair value of Atlantic International’ common stock to be issued in the Merger) will be allocated between the capital -raisingtransaction and the asset acquisition. The amount allocated to the asset acquisition will adjust the initial carrying value of the long -livedassets, such that the value recorded for these acquired assets will be equal to the fair value of the Atlantic International common stock issued for such assets. The remaining excess which is allocated to the capital -raisingcomponent (as described in Note 3 Basis of Proforma Presentation) will be recognized in equity such that the value recorded for these acquired assets will be equal to the fair value of the Atlantic International common stock issued for such assets. The allocation of the purchase price is estimated and is dependent upon estimates of certain valuations that are subject to change. In addition, the final purchase price will not be known until the date of the completion of the Merger and could vary materially from the preliminary purchase price. Accordingly, the final accounting adjustments may be materially different from the preliminary unaudited pro forma adjustments presented. Regulatory Approvals Completion of the Merger is subject to prior receipt of all approvals required to be obtained from applicable governmental and regulatory authorities. Subject to the terms and conditions of the Merger Agreement, Atlantic International and Staffing 360 agreed to use all reasonable efforts to take, or cause to be taken, all actions as are to be taken by each of 99 them, respectively, or cause to be done all things reasonably necessary or advisable to consummate and make effective as promptly as