Company: ATLN
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001605888-25-000006
Chunk: 130

Company: ATLANTIC INTERNATIONAL CORP.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 8
Chunk 130
---
 lease payments. These costs are considered variable costs which are based on actual expenses incurred by the lessor. Therefore, these amounts are not included in the calculation of the right-of-use assets and lease liabilities. The Company has lease agreements which provide for fixed and scheduled escalations, which are included in the calculation of the right-of-use assets and lease liabilities. The Company does not generally enter into lease agreements with increases in the base rent amount based on changes to the consumer price index. Further, the Company has several locations in which its lease tenancy is month-to-month. For purposes of the Company’s lease liability calculations, the Company has estimated the length of time that it is reasonably certain to occupy the space. There is inherent variability risk due to these month-to-month tenancies.Options to Extend or Terminate Leases Many of the Company’s leases contain options to extend the lease term. The leases generally contain a single option of one-year to three-year renewal terms. The exercise of lease renewal options is at the Company’s sole discretion. If it is reasonably certain that the Company will exercise such options, the periods covered by such options are included in the lease term and are recognized as part of the Company’s right-of-use assets and lease liabilities. The Company’s leases do not generally contain options to early terminate; however, leases with month-to-month tenancy can be terminated at any time. Discount Rate and Lease TermThe following table summarizes the weighted average remaining lease term and discount rate for operating leases as of December 31, 2024 and December 31, 2023:December 31, 2024December 31, 2023Weighted average remaining lease term for operating leases2.07 years1.75 yearsWeighted average discount rate for operating leases6.29 %4.22 %Lease Costs and ActivityThe Companies lease costs and activity are as follows:Year Ended December 31, Operating Lease Cost20242023Fixed lease costs to non-related parties$1,723,037 $1,419,202 Variable lease costs to non-related parties224,041 226,837 Total lease cost$1,947,078 $1,646,039 Year Ended December 31,Supplemental Cash Flow Disclosures20242023Cash paid to non-related parties for the amounts included in the measurement of operating lease liabilities$1,703,706 $1,409,154 Right-of-use assets obtained in exchange of new operating lease liabilities$429,121 $445