HUDSON TECHNOLOGIES INC /NY

Previous wording

The Company is a leading provider of sustainable refrigerant products and services to the Heating Ventilation Air Conditioning and Refrigeration (“HVACR”) industry. For over three decades, we have demonstrated our commitment to our customers and the environment by becoming one of the United States’ largest refrigerant reclaimers through multimillion dollar investments in the plants and advanced separation technology required to recover a wide variety of refrigerants and restoring them to Air-Conditioning, Heating, and Refrigeration Institute (“AHRI”) standard for reuse as certified EMERALD Refrigerants™.

Current wording

The Company is a leading provider of sustainable refrigerant products and services to the Heating Ventilation Air Conditioning and Refrigeration (“HVACR”) industry. For nearly three decades, we have demonstrated our commitment to our customers and the environment by becoming one of the United States’ largest refrigerant reclaimers through multimillion dollar investments in the plants and advanced separation technology required to recover a wide variety of refrigerants and restoring them to Air-Conditioning, Heating, and Refrigeration Institute (“AHRI”) standard for reuse as certified EMERALD Refrigerants™.

Previous wording

Selling, general and administrative (“SG&A”) expenses for the three-month period ended September 30, 2025 were $8.9 million, an increase of $0.8 million from the $8.1 million reported during the comparable 2024 period. The increase was primarily driven by higher sales personnel costs.

Current wording

Selling, general and administrative (“SG&A”) expenses for the three-month period ended March 31, 2026 were $9.5 million, an increase of $1.3 million from the $8.2 million reported during the comparable 2025 period due to an increase in professional fees and IT expenses.

Previous wording

Amortization expense for the three-month periods ended September 30, 2025 and 2024 were $0.8 million and $0.9 million, respectively.

Current wording

Amortization expense for the three-month periods ended March 31, 2026 and 2025 was $0.9 million and $0.8 million, respectively.

Previous wording

Net interest income for the three-month period ended September 30, 2025 was $0.8 million, compared to the net interest income of $0.3 million reported during the comparable 2024 period reflecting the Company’s unlevered balance sheet and higher cash position.

Current wording

Interest income for the three-month period ended March 31, 2026 was $0.1 million, compared to the interest income of $0.6 million reported during the comparable 2025 period.

Previous wording

The income tax expense for the three-month period ended September 30, 2025 was $4.0 million compared to income tax expense of $1.7 million for the three-month period ended September 30, 2024. Income tax expense for federal and state income tax purposes was determined by applying statutory income tax rates to pre-tax income after adjusting for certain items.

Current wording

The Company’s income tax expense for the three-month period ended March 31, 2026 and March 31, 2025 was $1.3 million and $0.9 million, respectively. The Company’s effective tax rate for the three-month period ended March 31, 2026 and March 31, 2025 was 79.3% and 24.5%, respectively. The increase in the effective tax rate was primarily due to discrete tax items recognized during the period, including non-deductible equity-based compensation and other discrete items. For the three-month period ended March 31, 2026 and March 31, 2025, income tax expense for federal and state income tax purposes was determined by applying statutory income tax rates to pre-tax income after adjusting for discrete items.

Previous wording

Net income for the nine-month period ended September 30, 2025 was $25.3 million, a decrease of $1.7 million from the $27.0 million of net income reported during the comparable 2024 period. The decrease was attributable to both lower gross profit and margin and higher SG&A costs, as described above.

Current wording

The net income for the three-month period ended March 31, 2026 was $0.3 million, a decrease of $2.5 million from the $2.8 million of net income reported during the comparable 2025 period, primarily due to higher SG&A costs and lower gross margin, as described above.

Previous wording

At September 30, 2025, the Company had working capital, which represents current assets less current liabilities, of $170.3 million, an increase of $22.6 million from the working capital of $147.7 million at December 31, 2024. The increase in working capital is primarily attributable to a rise in cash.

Current wording

At March 31, 2026, the Company had working capital, which represents current assets less current liabilities, of $143.0 million, a decrease of $3.2 million from the working capital of $146.2 million at December 31, 2025. The decrease in working capital is primarily attributable to the decrease in cash and increase in accounts payable due to higher inventory purchases at year end.

Previous wording

Inventories and trade receivables are principal components of current assets. At September 30, 2025, the Company had inventories of $97.4 million, an increase of $1.2 million from $96.2 million at December 31, 2024. The Company’s ability to sell and replace its inventory on a timely basis and the prices at which it can be sold are subject, among other things, to current market conditions and the nature of supplier or customer arrangements and the Company’s ability to source CFC and HCFC based refrigerants (which are no longer being produced) and HFC refrigerants (with newly manufactured production currently in the process of being phased down) and HFO refrigerants.

Current wording

Inventories and trade receivables are principal components of current assets. At March 31, 2026, the Company had inventories of $130.7 million, a decrease of $5.2 million from $135.9 million at December 31, 2025. The Company’s ability to sell and replace its inventory on a timely basis and the prices at which it can be sold are subject, among other things, to current market conditions and the nature of supplier or customer arrangements and the Company’s ability to source CFC and HCFC based refrigerants (which are no longer being produced) and HFC refrigerants (with newly manufactured production currently in the process of being phased down) and HFO refrigerants.

Previous wording

At September 30, 2025, the Company had trade receivables, net of allowance for credit losses, of $25.4 million, an increase of $11.8 million from $13.6 million at December 31, 2024, mainly due to seasonal timing. The Company typically generates its most significant revenue during the second and third quarters of any given year. The Company’s trade receivables are concentrated with various wholesalers, brokers, contractors and end-users within the refrigeration industry that are primarily located in the continental United States. The Company has historically financed its working capital requirements through cash flows from operations, debt, and the issuance of equity securities.

Current wording

At March 31, 2026, the Company had trade receivables, net of allowance for credit losses, of $33.5 million, an increase of $16.4 million from $17.1 million at December 31, 2025, mainly due to seasonal timing. The Company typically generates its most significant revenue during the second and third quarters of any given year. The Company’s trade receivables are concentrated with various wholesalers, brokers, contractors and end-users within the refrigeration industry that are primarily located in the continental United States. The Company has historically financed its working capital requirements through cash flows from operations, debt, and the issuance of equity securities.

Previous wording

Net cash provided by operating activities for the nine-month period ended September 30, 2025 was $29.4 million, when compared to net cash provided by operating activities of $71.1 million for the comparable 2024 period, mainly due to the timing of inventories, accounts receivable, accounts payable and accrued expenses.

Current wording

Net cash used in operating activities for the three-month period ended March 31, 2026 was $12.8 million, compared to net cash provided by operating activities of $14.2 million for the comparable 2025 period. This change is primarily driven by the timing of inventories, lower of cost net reserve, trade receivable, accounts payable and accrued expenses.

Previous wording

Net cash used in investing activities for the nine-month period ended September 30, 2025 was $3.9 million compared with net cash used in investing activities of $24.4 million for the comparable 2024 period, mainly due to recent acquisition of USA Refrigerants as previously discussed in Note 10 above and timing of capital expenditures related to capitalization of the Company’s replacement ERP system.

Current wording

Net cash used in investing activities for the three-month period ended March 31, 2026 was $1.1 million compared with net cash used in investing activities of $1.4 million for the comparable 2025 period, mainly due to timing of capital expenditures related to capitalization of the Company’s ERP system.

Previous wording

Net cash used in financing activities for the nine-month period ended September 30, 2025 was $5.9 million compared with net cash used in financing activities of $2.6 million for the comparable 2024 period. For the period ended September 30, 2025, the Company repurchased 939,259 shares of its common stock, at a cost of $5.8 million.

Current wording

Net cash used in financing activities for the three-month period ended March 31, 2026 was $6.2 million compared with net cash used in financing activities of $1.8 million for the comparable 2025 period. The variance is mainly due to the excess tax on benefits from the exercise of options for $3.7 million and the repurchase of 416,480 shares of Company common stock, at a cost of $2.5 million for the period ended March 31, 2026.

Previous wording

At September 30, 2025, cash and cash equivalents were $89.7 million, or approximately $19.6 million higher than the $70.1 million of cash and cash equivalents at December 31, 2024.

Current wording

At March 31, 2026, cash and cash equivalents were $19.4 million, or approximately $20.1 million lower than the $39.5 million of cash and cash equivalents at December 31, 2025.

Previous wording

Under the terms of the Amended Wells Fargo Facility, the Borrowers: (i) immediately borrowed $15 million in the form of a “first in last out” term loan (the “FILO Tranche”) and (ii) could initially borrow from time to time, up to $75 million at any time consisting of revolving loans (the “Revolving Loans”) in a maximum amount up to the lesser of $75 million and a borrowing base that is calculated based on the outstanding amount of the Borrowers’ eligible receivables and eligible inventory, as described in the Amended Wells Fargo Facility. The Amended Wells Fargo Facility also initially contained a sublimit of $9 million for swing line loans and $2 million for letters of credit. The Company currently has a $0.9 million letter of credit outstanding. The FILO Tranche was repaid in full in July 2023 and may not be reborrowed.

Current wording

Under the terms of the Amended Wells Fargo Facility, the Borrowers: (i) immediately borrowed $15 million in the form of a “first in last out” term loan (the “FILO Tranche”) and (ii) could initially borrow from time to time, up to $75 million at any time consisting of revolving loans (the “Revolving Loans”) in a maximum amount up to the lesser of $75 million and a borrowing base that is calculated based on the outstanding amount of the Borrowers’ eligible receivables and eligible inventory, as described in the Amended Wells Fargo Facility. The Amended Wells Fargo Facility also initially contained a sublimit of $9 million for swing line loans and $2 million for letters of credit. The Company currently has $1.3 million of letters of credit outstanding. The FILO Tranche was repaid in full in July 2023 and may not be reborrowed.

Previous wording

The Amended Wells Fargo Facility contains a financial covenant requiring the Company to maintain at all times minimum liquidity (defined as availability under the Amended Wells Fargo Facility plus unrestricted cash) of at least $5 million, of which at least $3 million must be derived from availability. The Amended Wells Fargo Facility also contains a springing covenant, which takes effect only upon a failure to maintain undrawn availability of at least $11.25 million or upon an election by the Borrowers to increase the inventory component of the borrowing base, requiring the Company to maintain a Fixed Charge Coverage Ratio (FCCR) of not less than 1.00 to 1.00, as of the end of each trailing period of twelve consecutive months commencing with the month prior to the triggering of the covenant. The FCCR (as defined in the Wells Fargo Facility) is the ratio of (a) EBITDA for such period, minus unfinanced capital expenditures made during such period, to (b) the aggregate amount of (i) interest expense required to be paid (other than interest paid-in-kind, amortization of financing fees, and other non-cash interest expense) during such period, (ii) scheduled principal payments (but excluding principal payments relating to outstanding Revolving Loans under the Amended Wells Fargo Facility), (iii) all net federal, state, and local income taxes required to be paid during such period (provided, that any tax refunds received shall be applied to the period in which the cash outlay for such taxes was made), (iv) all restricted payments paid (as defined in the Amended Wells Fargo Facility) during such period, and (v) to the extent not otherwise deducted from EBITDA for such period, all payments required to be made during such period in respect of any funding deficiency or funding shortfall with respect to any pension plan. The FCCR covenant ceases after the Borrowers have been in compliance therewith for two consecutive months.

Current wording

The Amended Wells Fargo Facility contains a financial covenant requiring the Company to maintain at all times minimum liquidity (defined as availability under the Amended Wells Fargo Facility plus unrestricted cash) of at least $5 million, of which at least $3 million must be derived from availability. The Amended Wells Fargo Facility also contains a springing covenant, which takes effect only upon a failure to maintain undrawn availability of at least $11.25 million or upon an election by the Borrowers to increase the inventory component of the borrowing base, requiring the Company to maintain a Fixed Charge Coverage Ratio (FCCR) of not less than 1.00 to 1.00, as of the end of each trailing period of twelve consecutive months commencing with the month prior to the triggering of the covenant. The FCCR (as defined in the Wells Fargo Facility) is the ratio of (a) EBITDA for such period, minus unfinanced capital expenditures made during such period, to (b) the aggregate amount of (i) interest expense required to be paid (other than interest paid-in-kind, amortization of financing fees, and other non-cash interest expense) during such period, (ii) scheduled principal payments (but excluding principal payments relating to outstanding Revolving Loans under the Amended Wells

Previous wording

On October 23, 2024, the Borrowers and the Company entered into a Second Amendment to Amended and Restated Credit Agreement (the “Second Amendment”) with Wells Fargo and the lenders under the Amended Wells Fargo Facility. The Second Amendment amends the provision relating to permitted stock repurchases by the Company, to permit stock repurchases in an amount not to exceed $10 million per calendar year in each of 2024 and 2025 and $5 million in any calendar year thereafter during the term of the Amended Wells Fargo Facility, upon satisfaction of certain conditions, subject to an aggregate cap of $25 million.

Current wording

On October 23, 2024, the Borrowers and the Company entered into a Second Amendment to Amended and Restated Credit Agreement dated October 23, 2024 (the “Second Amendment”) with Wells Fargo and the lenders under the Amended Wells Fargo Facility. The Second Amendment amended the provision relating to permitted stock repurchases by the Company, to permit stock repurchases in an amount not to exceed $10 million per calendar year in each of 2024 and 2025 and $5 million in any calendar year thereafter during the term of the Amended Wells Fargo Facility, upon satisfaction of certain conditions, subject to an aggregate cap of $25 million.

Previous wording

The Company believes that it will be able to satisfy its working capital requirements for the foreseeable future from anticipated cash flows from operations and available funds under the Amended Wells Fargo Facility. Any unanticipated expenses, including, but not limited to, an increase in the cost of refrigerants purchased by the Company, an increase in operating expenses or failure to achieve expected revenues from the Company’s RefrigerantSide® Services and/or refrigerant sales or additional expansion or acquisition costs that may arise in the future would adversely affect the Company’s future capital needs. There can be no assurance that any of the Company’s proposed or future plans will be successful, and as such, the Company may require additional capital sooner than anticipated, which capital may not be available on acceptable terms, or at all.

Current wording

The Company believes that it will be able to satisfy its working capital requirements for the foreseeable future from anticipated cash flows from operations and available funds under the Amended Wells Fargo Facility. Any unanticipated expenses, including, but not limited to, an increase in the cost of refrigerants purchased by the Company, an increase in operating expenses or failure to achieve expected revenues from the Company’s RefrigerantSide® Services and/or refrigerant sales or additional expansion or acquisition costs that may arise in the future would adversely affect the Company’s future capital needs. There can be no assurance that any of

Previous wording

For the nine-month periods ended September 30, 2025 and 2024, the United States Defense Logistics Agency (the “DLA”) accounted for greater than 10% of the Company’s revenue and over 10% of the outstanding accounts receivable at September 30, 2025 and September 30, 2024. Revenue from the DLA totaled $30.2 million and $28.0 million for the nine-month periods ended September 30, 2025 and September 30, 2024. Accounts receivable from the DLA totaled $6.2 million and $3.5 million as of September 30, 2025 and December 31, 2024, respectively.

Current wording

For the three-month periods ended March 31, 2026 and 2025, the United States Defense Logistics Agency (the “DLA”) accounted for greater than 10% of the Company’s revenue and 8% and 23% of the outstanding accounts receivable at March 31, 2026 and December 31, 2025. Revenue from the DLA totaled $7.7 million and $9.4 million for the three-month periods ended March 31, 2026 and March 31, 2025. Accounts receivable from the DLA totaled $2.7 million and $4.3 million as of March 31, 2026 and December 31, 2025, respectively.