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Note 6 - Debt | 12 Months Ended
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Jan. 31, 2020
Notes to Financial Statements |
Debt Disclosure [Text Block] | Note 6 - Debt
(In thousands) |  | 2019 |  | 2018
Revolving line - North America |  | $ | 8,577 |  |  | $ | 8,890 |
Mortgage notes |  |  | 6,568 |  |  |  | 6,961 |
Revolving lines - foreign |  |  | 691 |  |  |  | 84 |
Finance lease obligations |  |  | 1,094 |  |  |  | 536 |
Total debt |  |  | 16,930 |  |  |  | 16,471 |
Unamortized debt issuance costs |  |  | (169 | ) |  |  | (181 | )
Less current maturities |  |  | 10,044 |  |  |  | 9,539 |
Total long-term debt |  | $ | 6,717 |  |  | $ | 6,751 |
Current portion of long-term debt |  | $ | 10,044 |  |  | $ | 9,539 |
Unamortized debt issuance costs |  |  | (9 | ) |  |  | (9 | )
Total short-term debt |  | $ | 10,035 |  |  | $ | 9,530 |
The following table summarizes the Company's scheduled maturities on January 31:
(In thousands) |  | Total |  | 2021 |  | 2022 |  | 2023 |  | 2024 |  | 2025 |  | Thereafter
Revolving line - North America |  | $ | 8,577 |  |  | $ | 8,577 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Mortgages |  |  | 6,568 |  |  |  | 360 |  |  |  | 364 |  |  |  | 370 |  |  |  | 376 |  |  |  | 383 |  |  |  | 4,715 |
Revolving lines - foreign |  |  | 691 |  |  |  | 691 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Finance lease obligations |  |  | 1,094 |  |  |  | 416 |  |  |  | 290 |  |  |  | 247 |  |  |  | 141 |  |  |  | — |  |  |  | — |
Total |  | $ | 16,930 |  |  | $ | 10,044 |  |  | $ | 654 |  |  | $ | 617 |  |  | $ | 517 |  |  | $ | 383 |  |  | $ | 4,715 |
Revolving line - North America . On September 20, 2018, the Company and certain of its U.S. and Canadian subsidiaries (collectively, together with the Company, the “North American Loan Parties”) entered into a new Revolving Credit and Security Agreement (the “Credit Agreement”) with PNC Bank, National Association, as administrative agent and lender (“PNC”), providing for a new three -year $18 million Senior Secured Revolving Credit Facility, subject to a borrowing base including various reserves (the “Senior Credit Facility”). The Senior Credit Facility replaced the Company’s then existing $15 million Credit and Security Agreement, dated September 24, 2014, among various subsidiaries of the Company and Bank of Montreal, as successor by assignment to BMO Harris Bank N.A., as amended (the “Prior Credit Agreement”). The Company initially used borrowings under the new Senior Credit Facility to pay off outstanding amounts under the Prior Credit Agreement (which totaled approximately USD $3,773,823 plus CAD 4,794,528 ) and cash collateralize a letter of credit (USD $154,500 ). The Company has used proceeds from the new Senior Credit Facility for on-going working capital needs, and expects to continue using this facility to fund future capital expenditures, working capital needs and other corporate purposes. Borrowings under the Senior Credit Facility bear interest at a rate equal to an alternate base rate or LIBOR, plus, in each case, an applicable margin. The applicable margin is based on average quarterly undrawn availability with respect to the Senior Credit Facility. Interest on alternate base rate borrowings are generally payable monthly in arrears and interest on LIBOR borrowings are generally be payable in arrears on the last day of each interest period. Additionally, the Company is required to pay a 0.375% per annum facility fee on the unused portion of the Senior Credit Facility. The facility fee is payable quarterly in arrears. Subject to certain exceptions, borrowings under the Senior Credit Facility are secured by substantially all of the assets of the Company and certain of its North American subsidiaries. The North American Loan Parties’ obligations under the Senior Credit Facility are guaranteed by Perma-Pipe Canada, Inc. The Senior Credit Facility will mature on September 20, 2021. Subject to certain qualifications and exceptions, the Senior Credit Facility contains covenants that, among other things, restrict the North American Loan Parties’ ability to create liens, merge or consolidate, consummate acquisitions, make investments, dispose of assets, incur debt, and pay dividends and other distributions. In addition, the North American Loan Parties cannot allow capital expenditures to exceed $3 million annually (plus a limited carryover of unused amounts). The Senior Credit Facility also contains financial covenants requiring (i) the North America Loan Parties to achieve EBITDA of at least $2,462,000 for the period from August 1, 2018 through January 31, 2019; ( ii) the North America Loan Parties to achieve a ratio of its EBITDA (with certain additional adjustments) to the sum of scheduled cash principal payments on indebtedness for borrowed money and interest payments on the advances under the Senior Credit Facility (excluding from the calculation items related to the financial performance of the Company’s foreign subsidiaries not party to the Credit Agreement) to be not less than 1.10 to 1.00 for the nine -month period ending April 30, 2019 and for the quarter ending July 31, 2019 and each quarter end thereafter on a trailing four -quarter basis; and (iii) the Company and its subsidiaries (including the Company’s foreign subsidiaries not party to the Credit Agreement) to achieve a ratio of its EBITDA (with certain additional adjustments) to the sum of scheduled cash principal payments on indebtedness for borrowed money and interest payments on the advances under the Senior Credit Facility of not less than 1.10 to 1.00 for the nine -month period ending October 31, 2018 and for the quarter ending January 31, 2019 and each quarter end thereafter on a trailing four -quarter basis. The Company was in compliance with these covenants as of January 31, 2020. As of January 31, 2020, the Company had borrowed an aggregate of $8.6 million at a weighted average interest rate of 6.04%, and had $3.4 million available under the Senior Credit Facility. Revolving lines - foreign. The Company also has credit arrangements used by its Middle Eastern subsidiaries in the U.A.E. These credit arrangements are in the form of overdraft facilities and project financing at rates competitive in the countries in which the Company operates. The lines are secured by certain equipment, certain assets (such as accounts receivable and inventory), and a guarantee by the Company. Some credit arrangement covenants require a minimum tangible net worth to be maintained, including maintaining certain levels of intercompany subordinated debt. In addition, some of the revolving credit facilities restrict payment of dividends or undertaking of additional debt. In November 2019, the Company's Egyptian subsidiary entered into credit arrangement with a bank in Egypt for a revolving line of 200.0 million Egyptian Pounds (approximately USD $12.6 million at January 31, 2020). This credit arrangement is in the form of project financing at rates competitive in Egypt. The line is secured by certain assets (such as accounts receivable). Among other covenants, the credit arrangement establishes a maximum leverage ratio allowable and restricts the ability to undertake any additional debt. On January 31, 2020, the Company was in compliance with the covenants under these credit arrangements. On January 31, 2020, interest rates were based on the EIBOR plus 3.5% per annum, with a minimum interest rate of 4.5% per annum for the U.A.E. credit arrangements and based on the CBE corridor rate plus 1.5% per annum for the Egypt credit arrangement. On January 31, 2020, the Company's interest rates ranged from 5.4% to 16.3%, with a weighted average rate of 5.9%, and the Company could borrow $21.6 million under these credit arrangements. On January 31, 2020, $4.2 million of availability was used to support letters of credit to guarantee amounts committed for inventory purchases and for performance guarantees. On January 31, 2020, the Company had borrowed $0.7 million, and had an additional $16.8 million available. The foreign revolving lines balances as of January 31, 2020 and 2019, were included as current maturities of long-term debt in the Company's consolidated balance sheets. The Company had a revolving line for 8.0 million Dirhams (approximately USD $2.2 million at January 31, 2020 ) from a bank in the U.A.E. The loan had an interest rate of approximately 5.4% and expired on March 31, 2019. The loan was renewed until November 2020 under the same terms. The Company has a revolving line for 25.0 million Dirhams (approximately USD $6.8 million at January 31, 2020 ) from a bank in the U.A.E. The loan had an interest rate of approximately 5.9% and expired in July 2019. The loan was renewed until July 2020 under the same terms. The Company’s credit arrangements used by its Middle Eastern subsidiaries renew on an annual basis. The Company has a revolving line for 200.0 million Egyptian Pounds (approximately USD $12.6 million at January 31, 2020) from a bank in Egypt. The loan has an interest rate of approximately 16.3% and expires in June 2020. The Company guarantees the subsidiaries' debt including all foreign debt. Mortgages. On July 28, 2016, the Company borrowed CAD 8.0 million (approximately USD $6.1 million at the prevailing exchange rate on the transaction date) from a bank in Canada under a mortgage note secured by the manufacturing facility located in Alberta, Canada that matures on December 23, 2042. The interest rate is variable, currently at 6.05% , with monthly payments of CAD 37 thousand (approximately USD $28 thousand) for interest; and monthly payments of CAD 27 thousand (approximately USD $21 thousand) for principal. Principal payments began January 2018. On June 19, 2012, the Company borrowed $1.8 million under a mortgage note secured by its manufacturing facility in Lebanon, Tennessee. The proceeds were used for payment of amounts borrowed. The loan bears interest at 4.5% with monthly payments of $13 thousand for both principal and interest and matures July 1, 2027. On June 19, 2022, and on the same day of each year thereafter, the interest rate shall adjust to the prime rate, provided that the applicable interest rate shall not adjust more than 2.0% per annum and shall be subject to a ceiling of 18.0% and a floor of 4.5%.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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