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LONG-TERM DEBT | 12 Months Ended
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Jan. 31, 2017
Debt Disclosure [Abstract] |
Long-term Debt [Text Block] |
| 5. | LONG-TERM DEBT
Revolving Credit Facility On June 28, 2013, as amended on March 31, 2015 and June 3, 2015, Lakeland Industries, Inc. and its wholly owned Canadian subsidiary, Lakeland Protective Wear Inc. (collectively the “Borrowers”), entered into a Loan and Security Agreement (the “Senior Loan Agreement”) with AloStar Business Credit, a division of AloStar Bank of Commerce (the “Senior Lender”). The Senior Loan Agreement provides the Borrowers with a $15 million revolving line of credit (the “Senior Credit Facility”), at a variable interest rate based on LIBOR, with a first priority lien on substantially all of the United States and Canada assets of the Company, except for its Mexican plant and the Canadian warehouse. After these amendments the maturity date of the Senior Credit Facility is now June 28, 2017 and the minimum interest rate floor is 4.25% per annum. The Senior Lender has approved required aspects of the transactions relating to the Brazil operations as such transactions are further described in Note 13 hereto. The Company is negotiating a replacement facility as of April 26, 2017. The following is a summary of the material terms of the Senior Credit Facility: $15 million Senior Credit Facility
| · | Borrowing pursuant to a revolving credit facility subject to a borrowing base calculated as the sum of:
| o | 85% of eligible accounts receivable as defined
| o | The lesser of 60% of eligible inventory as defined or 85% of net orderly liquidation value of inventory
| o | In transit inventory in bound to the US up to a cap of $1,000,000
| o | Receivables and inventory held by the Canadian operating subsidiary to be included, up to a cap of $2.0 million of availability
| · | There was $4.9 million and $9.5 million outstanding under the Senior Credit Facility on January 31, 2017 and 2016, respectively.
| · | There was $10.1 million and $5.5 million available for further borrowings under the Senior Credit Facility on January 31, 2017 and 2016, respectively.
| ⋅ | Collateral
| o | A perfected first security lien on all of the Borrower’s United States and Canadian assets, other than its Mexican plant and the Canadian warehouse
| o | Pledge of 65% of Lakeland Industries, Inc. stock in all foreign subsidiaries other than 100% pledge of stock of its Canadian subsidiaries
| ⋅ | Collection
| o | All customers of Borrowers must remit to a lockbox controlled by Senior Lender or into a blocked account with all collection proceeds applied against the outstanding loan balance.
| · | Prepayment penalties of 1%.
| · | Interest Rate
| o | Rate equal to LIBOR rate plus 325 basis points, subject to Floor rate of 4.25%
| o | Rate at January 31, 2017 of 4.25% per annum
| · | Financial Covenants
| o | Borrowers are subject to certain covenants from the Closing Date, as defined in the Senior Loan Agreement, until the commitment termination date and full payment of the obligations to Senior Lender, Lakeland Industries, Inc. (the parent company), together with its subsidiaries on a consolidated basis, excluding its Brazilian subsidiary (which has since been transferred), is required to comply with the following additional covenants:
| · | Fixed Charge Coverage Ratio. At the end of each fiscal quarter of Borrowers, Borrowers shall maintain a Fixed Charge Coverage Ratio of not less than 1.1 to 1.00 for the twelve month period then ending.
| · | Minimum Quarterly Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”). Borrowers shall achieve, on a rolling four quarter basis excluding the operations of the Borrower’s then Brazilian subsidiary, EBITDA of not less than $4.1 million.
| · | Capital Expenditures. Borrowers shall not during any fiscal year make capital expenditures in an amount exceeding $1 million in the aggregate.
| · | Other Covenants
| o | Standard financial reporting requirements as defined
| o | Limitation on total net investment in foreign subsidiaries of a maximum of $1.0 million per annum
Borrowings in UK On December 31, 2014, the Company and Lakeland Industries Europe, Ltd, (“Lakeland UK”), a wholly owned subsidiary of the Company, amended the terms of its existing line of credit facility with HSBC Bank to provide for (i) a one-year extension of the maturity date of the existing financing facility to December 19, 2016, (ii) an increase in the facility limit from £1,250,000 (approximately USD $1.9 million, based on exchange rates at time of closing) to £1,500,000 (approximately USD $2.3 million, based on exchange rates at time of closing), and (iii) a decrease in the annual interest rate margin from 3.46% to 3.0%. In addition, pursuant to a letter agreement dated December 5, 2014, the Company agreed that £400,000 (approximately USD $0.6 million, based on exchange rates at time of closing) of the note payable by the UK subsidiary to the Company shall be subordinated in priority of payment to the subsidiary’s obligations to HSBC under the financing facility. The balance under this loan outstanding at January 31, 2017 and January 31, 2016 was USD $0.1 million and USD $0, respectively, and is included in short-term borrowings on the consolidated balance sheet. On December 31, 2016, Lakeland UK entered into an extension of the maturity date of its existing financing facility with HSBC Invoice Finance (UK) Ltd. to December 19, 2017. Other than the extension of the maturity date and a small reduction of the service charge from 0.9% to 0.85%, all other terms of the facility remain the same. Canada Loans In September 2013, the Company refinanced its loan with the Development Bank of Canada (“BDC”) for a principal amount of approximately $1.1 million in both Canadian dollars and USD (based on exchange rates at time of closing). Such loan is for a term of 240 months at an interest rate of 6.45% per annum with fixed monthly payments of approximately USD $6,048 (CAD $8,169) including principal and interest. It is collateralized by a mortgage on the Company's warehouse in Brantford, Ontario. The amount outstanding at January 31, 2017 is CAD $1,002,000 which is included as USD $716,000 in long term borrowings on the accompanying consolidated balance sheet, net of current maturities of USD $50,000. The amount outstanding at January 31, 2016 was USD $691,000 (CAD $1.0 million) in long term borrowings, net of current maturities of USD $50,000. China Loans On March 28, 2016, Weifang Lakeland Safety Products Co., Ltd., (“WF”), the Company’s Chinese subsidiary and Chinese Rural Credit Cooperative Bank (“CRCCB”) completed an agreement for WF to obtain a line of credit for financing in the amount of USD $1.3 million, with interest at 120% of the benchmark rate supplied by CRCCB (which is currently 4.6% per annum), with the line of credit having a term of one year. The effective per annum interest rate was 5.35%. The loan was collateralized by inventory owned by WF. The line of credit was paid in full prior to January 31, 2017. On December 1, 2015, WF and CRCCB entered into an agreement for WF to obtain a line of credit for financing in the amount of RMB 6.0 million (approximately USD $0.9 million), with interest at 120% of the benchmark rate supplied by CRCCB (which is currently 4.6% per annum), and with the line of credit having a term of one year. The effective per annum interest rate was 5.52%. The loan was collateralized by inventory owned by WF. The line of credit was paid in full prior to January 31, 2017. At January 31, 2016, the line of credit was RMB 6.0 million (approximately USD $0.9 million). On October 10, 2015, WF and Bank of China Anqiu Branch entered into an agreement for WF to obtain a line of credit for financing in the amount RMB 5.0 million (approximately USD $0.8 million). The effective per annum interest rate was 7%, with the line of credit having a term of one year. The loan was collateralized by inventory owned by WF. The line of credit was paid in full prior to January 31, 2017. At January 31, 2016, the line of credit was RMB 5.0 million (approximately USD $0.8 million). On September 21, 2015, WF and CRCCB entered into an agreement for WF to obtain a line of credit for financing in the amount RMB 8.0 million (approximately USD $1.3 million). The effective per annum interest rate was 5.52%, with the line of credit having a term of one year. The loan was collateralized by inventory owned by WF. The line of credit was paid in full prior to January 31, 2017. At January 31, 2016, the line of credit was RMB 8.0 million (approximately USD $1.3 million). Argentina Loan In April 2015, Lakeland Argentina S.R.L. (“Lakeland Argentina”), the Company’s Argentina subsidiary was granted a $300,000 line of credit denominated in Argentine pesos, pursuant to a standby letter of credit granted by the parent company. The line of credit outstanding of $0.2 million at January 31, 2016 was the total of five separate loans which were paid in full during the course of normal operations and prior to January 31, 2017, except for the $38,000 noted below. The following three loans were made under the $300,000 facility stated above: On December 2, 2015, Lakeland Argentina and Banco Santander Rio S.A (“Santander”) entered into an agreement for Lakeland Argentina to obtain a loan in the amount of ARS 559,906 (approximately USD $50,000, based on exchange rates at time of closing); such loan is for a term of 18 months at an interest rate of 42% per annum. The amount outstanding at January 31, 2017 is ARS 138,333 (approximately USD $9,000) which is included as short-term borrowings on the consolidated balance sheet. At January 31, 2016, the line of credit was ARS 522,000 (approximately USD $38,000). On March 30, 2016, Lakeland Argentina and Banco de la Nación Argentina (“BNA”) entered into an agreement for Lakeland Argentina to obtain a loan in the amount of ARS 830,000 (approximately USD $56,000, based on exchange rates at time of closing); such loan is for a term of 18 months at an interest rate of 27% per annum. The loan was paid in full prior to January 31, 2017. Below is a table to summarize the debt amounts above (in 000’s):
|  |  |  |  |  | Current Maturity of |  | Revolving Credit |
|  | Short-Term |  | Long-term |  | Long-term |  | Facility |
|  | 1/31/2017 |  | 1/31/2016 |  | 1/31/2017 |  | 1/31/2016 |  | 1/31/2017 |  | 1/31/2016 |  | 1/31/2017 |  | 1/31/2016 |
Argentina |  | $ | 27 |  | $ | 248 |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |
Canada |  |  | - |  |  | - |  |  | 716 |  |  | 691 |  |  | 50 |  |  | 50 |  |  | - |  |  | - |
China |  |  | - |  |  | 2,978 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |
UK |  |  | 126 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |
USA |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | 4,865 |  |  | 9,458 |
TOTALS |  | $ | 153 |  | $ | 3,226 |  | $ | 716 |  | $ | 691 |  | $ | 50 |  | $ | 50 |  | $ | 4,865 |  | $ | 9,458 |
Five-year Debt Payout Schedule This schedule reflects the liabilities as of January 31, 2017, and does not reflect any subsequent event:
|  | Total |  | 1 Year or less |  | 2 Years |  | 3 Years |  | 4 Years |  | 5 Years |  | After 5 Years |
Revolving credit facility |  | $ | 4,865,094 |  | $ | 4,865,094 |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |
Borrowings in Canada |  |  | 766,455 |  |  | 50,000 |  |  | 28,034 |  |  | 29,896 |  |  | 31,883 |  |  | 34,000 |  |  | 592,642 |
Borrowings in UK |  |  | 126,189 |  |  | 126,189 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |
Borrowings in Argentina |  |  | 26,585 |  |  | 26,585 |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |
Total |  | $ | 5,784,323 |  | $ | 5,067,868 |  | $ | 28,034 |  | $ | 29,896 |  | $ | 31,883 |  | $ | 34,000 |  | $ | 592,642 |

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