Company: APT
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001437749-25-015457
Chunk: 10

Company: ALPHA PRO TECH LTD
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 10
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The Company has operating leases for the Company’s corporate office and manufacturing facilities, which expire at various dates through 2034. The Company’s primary operating lease commitments as of March 31, 2025, related to the Company’s manufacturing facilities in Valdosta, Georgia and Nogales, Arizona, as well as the Company’s corporate headquarters in Aurora, Ontario, Canada.

As of March 31, 2025, the Company had operating lease right-of-use assets of $8,485,000and operating lease liabilities of $8,562,000. As of March 31, 2025, we did nothave any finance leases recorded on the Company’s consolidated balance sheet. Operating lease expense was approximately $380,000during the three months ended March 31, 2025.

The aggregate future minimum lease payments and reconciliation to lease liabilities as of March 31, 2025 were as follows:

                                           March 31,                   
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                                           2025                        
  Remaining nine months of 2025            $                1,107,000  
  2026                                                      1,473,000  
  2027                                                      1,459,000  
  2028                                                      1,489,000  
  2029                                                      1,520,000  
  2030                                                        644,000  
  Thereafter                                                4,212,000  
  Total future minimum lease payments                      11,904,000  
  Less imputed interest                                   ( 3,342,000  
  Total lease liabilities                  $                8,562,000  

As of March 31, 2025, the weighted average remaining lease term of the Company’s operating leases was9.88years. During the three months ended March 31, 2025, the weighted average discount rate with respect to these leases was7.0%.

  14.      Income taxes  
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The Company accounts for income taxes using the asset and liability method. A valuation allowance is recorded to reduce the carrying amounts of deferred income tax assets unless it is more likely than not that such assets will be realized. The Company’s policy is to record any interest and penalties assessed by the Internal Revenue Service as a component of the provision for income taxes. The Company provides allowances for uncertain income tax positions when it is more likely than not that the position will not be sustained upon examination by