On November 12, 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 September
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 the applicable financial covenants, calculated as of June 30, 2019 and September
30, 2019, set forth in its (i) 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) 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. 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 September 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, in any event, not later than November 18, 2019.
The Form also provided the following preliminary
financial information for the quarter and nine months ended September 30, 2019:
For the quarter ended September
30, 2019, the Company’s revenues were $45.6 million, an increase of 13% compared to $40.5 million in the comparable 2018
period. The Company’s net income for the third quarter of 2019 was $3.1 million, or $0.07 per basic and diluted share, compared
to a net loss of $13.9 million or ($0.33) per basic and diluted share in the third quarter of 2018. Net income was favorably impacted
by $8.9 million of other income during the 2019 period arising from the settlement of a working capital adjustment dispute related
to the Company’s acquisition of Aspen Refrigerants, Inc.
For the nine months ended September
30, 2019, the Company’s revenues were $136.3 million, a decrease of 3% compared to $140.8 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 net loss for the first nine months of 2019 was $14.7 million, or ($0.34) per basic and diluted share, compared
to a net loss of $47.6 million or ($1.12) per basic and diluted share in the first nine months of 2018.