STOCKHOLDERS EQUITY

12 Months Ended

Jan. 31, 2025

STOCKHOLDERS EQUITY

STOCKHOLDERS' EQUITY

9. STOCKHOLDERS’ EQUITY

On June 21, 2017, the stockholders of the Company approved the Lakeland Industries, Inc. 2017 Equity Incentive Plan (the “2017 Plan”). The executive officers and all other employees and directors of the Company, including its subsidiaries, are eligible to participate in the 2017 Plan. The 2017 Plan is administered by the Compensation Committee of the Board of Directors (the “Committee”), except that with respect to all non-employee directors, the Committee shall be deemed to include the full Board. The 2017 Plan provides for the grant of equity-based compensation in the form of stock options, restricted stock, restricted stock units, performance shares, performance units, or stock appreciation rights (“SARs”).

An aggregate of 1,240,000 shares of the Company’s common stock are currently authorized for issuance under the 2017 Plan, as amended, subject to adjustment as provided in the 2017 Plan for stock splits, dividends, distributions, recapitalizations and other similar transactions or events. If any shares subject to an award are forfeited, expire, lapse or otherwise terminate without issuance of such shares, such shares shall, to the extent of such forfeiture, expiration, lapse or termination, again be available for issuance under the 2017 Plan.

The Company recognized total stock-based compensation expense, which are reflected in operating expenses (in 000’s):

	Year Ended January 31,
	2025		2024
2017 Plan:
Total restricted stock and stock option programs	$	1,558	$	1,365
Total income tax expense recognized for stock-based compensation arrangements	$	327	$	287

Restricted Stock

Under the 2017 Plan, as described above, the Company awarded performance-based and service-based shares of restricted stock and restricted stock units to eligible employees and directors. The following table summarizes the activity under the 2017 Plan for the years ended January 31, 2025 and 2024. This table reflects the amount of awards granted at the number of shares that would be vested if the Company were to achieve the target performance level under the June 2021, June 2022, March 2023 and April 2024 grants.

	Performance- Based			Service-Based			Total			Weighted Average Grant Date Fair Value
Outstanding at January 31, 2023		127,480			40,665			168,145		$	22.95
Awarded		64,953			130,390			195,343		$	14.19
Vested		(71,202	)		(26,336	)		(97,538	)	$	14.90
Forfeited		(38,901	)		(31,829	)		(70,730	)
Outstanding at January 31, 2024		82,330			112,890			195,220		$	16.61
Awarded		27,042			146,256			173,298		$	18.98
Vested	-				(70,220	)		(70,220	)	$	20.27
Forfeited		(39,702	)		(6,791	)		(46,493	)
Outstanding at January 31, 2025		69,670			182,135			251,805		$	17.36

The actual number of shares of common stock of the Company, if any, to be earned by the award recipients is determined over a three-year performance measurement period based on measures that include Earnings Before Interest Taxes Depreciation and Amortization (“EBITDA”) margin, revenue growth, and free cash flow for the June 2021 grants.  Performance measures for the April 2022 grants are revenue growth and EBITDA margin. Performance measures for the March 2023 grants are revenue growth, EBITDA margin and return on invested capital. The performance measures for the April 2024 grants are aggregate revenue during FY25, FY26, and FY27; EBITDA margin; and free cash flow margin. The performance targets have been set for each of the Minimum, Target, and Maximum levels. The actual performance amount achieved is determined by the Committee and may be adjusted for items determined to be unusual in nature or infrequent in occurrence, at the discretion of the Committee.

The compensation cost is based on the fair value at the grant date, is recognized over the requisite performance/service period using the straight-line method and is periodically adjusted for the probable number of shares to be awarded.  As of January 31, 2025, unrecognized stock-based compensation expense totaled $3.0 million pursuant to the 2017 Plan based on outstanding awards under the Plan.  This expense is expected to be recognized over approximately two years.

Stock Repurchase Program

On April 7, 2022, the Board of Directors authorized a stock repurchase program under which the Company may repurchase up to $5 million of its outstanding common stock, which became effective upon the completion of a prior share repurchase program.  On December 1, 2022, the Board of Directors authorized an increase in the Company’s stock repurchase program, under which the Company may repurchase up to an additional $5 million of its outstanding common stock. 

No shares were repurchased during FY25, leaving $5.0 million remaining under the share repurchase program at January 31, 2025.  The share repurchase program has no expiration date but may be terminated by the Board of Directors at any time.

Sale of Common Stock

On January 24, 2025, the Company sold 2,093,000 shares of its common stock at a price of $20.68 after underwriting discount.  After offering expenses, the Company received approximately $46.2, million which was used to pay down the credit facility.