Company: ATLN
Filing Date: 2025-01-23
Form Type: S-4/A
Source: 0001213900-25-006032
Chunk: 83

Company: ATLANTIC INTERNATIONAL CORP.
Filing Date: 2025-01-23
Form: S-4/A
Chunk 83
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 become due immediately. Our financing with MidCap Funding X Trust (“MidCap”) includes customary financial covenants and we have had instances of non -compliance. We have been able to obtain forbearance of any non -compliancefrom MidCap, and management expects to continue to be able to obtain necessary forbearance in the event of future non -compliance; however, there can be no assurance that we will be able to obtain such forbearance, and should MidCap refuse to provide a forbearance in the future, the outstanding debt under the agreement could become due immediately, which exceeds our current cash balance. Our debt instruments contain covenants that could limit our financing options and liquidity position, which would limit our ability to grow our business. Covenants in our debt instruments impose operating and financial restrictions on us. These restrictions prohibit or limit our ability to, among other things: •pay cash dividends to our stockholders, subject to certain limited exceptions; •redeem or repurchase our common stock or other equity; •incur additional indebtedness; •permit liens on assets; •make certain investments (including through the acquisition of stock, shares, partnership or limited liability company interests, any loan, advance or capital contribution); •sell, lease, license, lend or otherwise convey an interest in a material portion of our assets; •cease making public filings under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and •sell or otherwise issue shares of our common stock or other capital stock subject to certain limited exceptions. Our failure to comply with the restrictions in our debt instruments could result in events of default, which, if not cured or waived, could result in us being required to repay these borrowings before their due date. The holders of our debt may require fees and expenses to be paid or other changes to terms in connection with waivers or amendments. If we are forced to refinance these borrowings on less favorable terms, our results of operations and financial condition could be adversely affected by increased costs and rates. In addition, these restrictions may limit our ability to obtain additional financing, withstand downturns in our business or take advantage of business opportunities. The Jackson Notes are secured by substantially all of our assets that are not secured by our revolving loan facility with Midcap and the terms of the Jackson Notes may restrict our current and future operations. Additionally, Jackson may be able to exert significant influence over us as our senior secured lender. The Jackson Notes contain a number of restrictive c