On August 9, 2019, Hudson Technologies,
Inc. (the “Company”) filed a Form 12b-25 (the “Form”) with the Securities and Exchange Commission indicating
that the Company will not be in a position to timely file its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30,
2019, but intends to do so within the 5-day extension period provided in Rule 12b-25(b) promulgated under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”).
The Form stated that:
Hudson Technologies, Inc. (the
“Company”) was not in compliance with (i) the total leverage ratio covenant, calculated as of June 30, 2019, set forth
in its Term Loan Credit and Security Agreement, as amended, with U.S. Bank National Association, as agent, and the term loan lenders
(the “Term Loan”) and (ii) the minimum liquidity covenant under the Term Loan at July 31, 2019. The Company was also
not in compliance with the minimum EBITDA covenant for the four quarters ended June 30, 2019 set forth in its Amended and Restated
Revolving Credit and Security Agreement, as amended (the “Revolving Facility”), with PNC Bank, National Association,
as administrative agent, collateral agent and lender, PNC Capital Markets LLC as lead arranger and sole bookrunner, and such other
lenders thereunder.
The Company is currently seeking
a waiver and/or amendment from its lenders under both the Term Loan and the Revolving Facility, which the Company is working to
complete on or before August 14, 2019. As a result of the impact of foregoing discussions, the Company is not in a position to
file its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 (the “10-Q”) on a timely basis. The Company
is working diligently to resolve these matters and management currently believes that the Company will be in a position to file
the aforementioned 10-Q not later than August 14, 2019.
The Form also provided the following preliminary
financial information for the quarter and six months ended June 30, 2019:
For the quarter ended June 30,
2019, the Company’s revenues were $56.0 million, a decrease of 3% compared to $57.8 million in the comparable 2018 period.
The Company recorded lower of cost or net realizable value adjustments to its inventory of $9.2 million and $34.7 million during
the second quarter of 2019 and 2018, respectively. Due in part to the impact of the inventory adjustments referenced above, the
Company’s preliminary net loss for the second quarter of 2019 was $13.7 million, or ($0.32) per basic and diluted share,
compared to a net loss of $30.6 million or ($0.72) per basic and diluted share in the second quarter of 2018.
For the six months ended June
30, 2019, the Company’s revenues were $90.7 million, a decrease of 10% compared to $100.3 million in the comparable 2018
period. Due in part to the impact of the inventory adjustments referenced above, the Company’s preliminary net loss for the
first half of 2019 was $17.8 million, or ($0.42) per basic and diluted share, compared to a net loss of $33.7 million or ($0.79)
per basic and diluted share in the first half of 2018.
The Company issued a press release on August
14, 2019 announcing its financial results for the second quarter and six-month period ended June 30, 2019. The press release is
attached hereto as Exhibit 99.1. The information in this Item and the aforementioned press release shall not be deemed “filed”
for purposes of Section 18 of the Exchange Act, and is not incorporated by reference into any filing of the Company, whether made
before or after the date of this report, regardless of any general incorporation language in the filing.