XML 15 R9.htm IDEA: XBRL DOCUMENT v2.4.0.6
Notes Payable
6 Months Ended
Jul. 31, 2012
Notes Payable [Abstract]  
Notes Payable

Note 4 - Notes Payable

As of July 31, 2012, the Company had a financing agreement with JPMorgan Chase Bank, N.A., as agent for a consortium of banks. The Company’s financing agreement was a senior secured revolving credit facility providing for borrowings in the aggregate principal amount of up to $300 million. Borrowings under the financing agreement bore interest, at the Company’s option, at the prime rate plus 0.50% or LIBOR plus 2.75%. Amounts available under this financing agreement were subject to borrowing base formulas and over advances as specified in the financing agreement. The fair value of debt approximates carrying value and would be considered a level 2 fair value measurement.

The financing agreement required the Company, among other things, to maintain a maximum senior leverage ratio and minimum fixed charge coverage ratio, as defined, and also limited payments for cash dividends and stock redemptions. As of July 31, 2012, the Company was in compliance with these covenants. The financing agreement was secured by all of the Company’s assets. Amounts payable under the Company’s financing agreement were $87.0 million and $142.0 million at July 31, 2012 and 2011, respectively.

On August 6, 2012, the Company entered into a new credit agreement with JPMorgan Chase Bank, N.A., as Administrative Agent for a group of lenders. The credit agreement is a five year senior secured credit facility providing for borrowings in the aggregate principal amount of up to $450 million. Amounts available under the credit agreement are subject to borrowing base formulas and over advances as specified in the credit agreement. Borrowings bear interest, at the Company’s option, at LIBOR plus a margin of 1.5% to 2.0% or prime plus a margin of 0.5% to 1.0%, with the applicable margin determined based on availability under the credit agreement. The credit agreement requires the Company to maintain a minimum fixed charge coverage ratio, as defined, under certain circumstances and prohibits payments for cash dividends and stock redemptions until February 2014, after which such payments may be made subject to compliance with certain covenants. The credit agreement is secured by all of the assets of G-III Apparel Group, Ltd. and its subsidiaries, G-III Leather Fashions, Inc., J. Percy for Marvin Richards, Ltd., CK Outerwear, LLC, Andrew & Suzanne Company Inc., AM Retail Group, Inc., G-III Apparel Canada ULC, G-III License Company, LLC and AM Apparel Holdings, Inc.

On August 6, 2012, in connection with entering into the credit agreement, the Company repaid in full all borrowings under the financing agreement in the amount of approximately $97.1 million. As a result, the financing agreement was terminated.