HUDSON TECHNOLOGIES INC/NY: Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant, Change of Directors or Principal Officers, Amendments to Articles or Bylaws ; Year change, other events, financial statements and exhibits (Form 8-K)

Item 2.03    Creation of a Direct Financial Obligation or an Obligation under an
             Off-Balance Sheet Arrangement of a Registrant




New Term Loan Facility

At March 2, 2022, Hudson Technologies Company (“HTC”), an indirect subsidiary of
Hudson Technologies, Inc. (the “Company”), and the subsidiary of the Company Hudson Holdings, Inc.as borrowers (collectively, the “Borrowers”), and the Company, as guarantor, has become obligated under a credit agreement (the “Term Loan Facility”) with TCW Asset Management Company LLCas administrative agent (“Term Loan Agent”) and the lending parties (the “Term Loan Lenders”).

Under the term loan facility, the borrowers immediately borrowed $85 million pursuant to a term loan (the “Term Loan”). Amounts borrowed under the Term Loan Facility were used by the Borrowers to repay the outstanding principal amount and related fees and expenses under the Prior Term Loan Facility (as defined below) and for other business purposes.

The term loan matures on March 2, 2027, or earlier during certain acceleration or cross-failure events. Principal repayments on the term loan are required on a quarterly basis, beginning with the quarter ending March 31, 2022, in the amount of 5% of the initial principal amount of the outstanding term loan per year. The Term Loan Facility also requires annual payments of 50% of Excess Cash Flow (as defined in the Term Loan Facility); provided that from the year ending December 31, 2023 such payments may be reduced depending on the Company’s indebtedness ratio (as defined in the term loan facility) for the applicable year. The Term Loan Facility also requires mandatory prepayments of the Term Loans upon disposal of certain assets, issuance of debt securities and other events. The term loan can be prepaid at the option of the borrowers subject to a prepayment premium of 3% in the first year, 2% in the second year, 1% in the third year and zero in the fourth year and the following.

Interest on the term loan is generally payable monthly, in arrears. Interest charges on the Term Loan shall be calculated on the actual principal amount of the Term Loan outstanding at an annual rate equal to (A) in the case of Prime Rate Loans, the sum of (i) a annual rate equal to the greater of (1) 2.0%, (2) the federal funds rate plus 0.5%, (3) the one-month forward SOFR plus 1.0%, and (4) the commercial lending prime rate quoted by The Wall Street Journal, plus (ii) between 6.0% and 7.0% depending on the applicable leverage ratio and (B) for SOFR loans, the sum of the applicable SOFR rate plus between 7 .0% and 8.0% depending on the applicable leverage ratio.

The Borrowers and the Company have granted to the Term Lending Agent, for the benefit of the Term Lenders, a security interest in substantially all of their respective assets, including receivables, equipment, general intangibles (including including intellectual property), inventory, shares of subsidiaries, real estate property and certain other assets.

                                       2

The term loan facility contains a fixed charge coverage ratio covenant and a leverage ratio covenant, each tested quarterly. The term loan facility also contains customary non-financial covenants relating to the company and the borrowers, including limitations on the ability of the borrowers to pay dividends on common stock or preferred stock, and also includes certain events of default. , including defaults of payment, breaches of representations and warranties, covenant defaults, cross defaults of other obligations, bankruptcy and insolvency, certain ERISA events, judgments exceeding specified amounts, impairments of warranties and change control.

In connection with the closing of the Term Loan Facility, the Company has also entered into a Guarantee and Security Agreement, dated March 2, 2022 (the “Term Loan Guarantee”), pursuant to which the Company has confirmed its unconditional guarantee of payment and performance of all obligations due by the Borrowers to the Term Loan Agent, as agent for the benefit of term loan lenders.

The Term Lending Agent and the Agent (as defined below) have entered into an inter-creditor agreement governing the relative priority of their security interests given by the Borrowers and the Guarantor to the Collateral, providing that the Agent will have first ranking security interest in accounts receivable, inventory, deposit accounts and certain other assets (the “Revolving Credit Senior Guarantee”) and the Term Lending Agent will have first ranking security interest in equipment, real estate, the share capital of subsidiaries and certain other assets (the “Term Loan Senior Guarantee”).

The foregoing descriptions of the agreements do not purport to be complete and are qualified in their entirety by reference to the full text of the Term Loan Facility Agreement and the Term Loan Guarantee, which are filed as Exhibits 10.1 and 10.2, respectively, of this report. .

Termination of Prior Term Loan Facility

Along with entry into the new term loan facility described above, the
March 2, 2022 the Company’s existing term loans defined in the term credit and guarantee agreement with National Association of American Banksas collateral agent and administrative agent, and the various lenders thereunder, as amended (the “Prior Term Loan Facility”), which had a principal balance of approximately
$63.9 million after payment of a $16.0 million the excess cash flow amount thereunder, has been repaid in full, together with the required lender fees and expenses associated with $3.3 millionand the prior term loan facility was terminated.

Amendment to Revolving Credit Facility

At March 2, 2022, Hudson Technologies Company (“HTC”) and Hudson Holdings, Inc.
. . .

Article 5.02 Departure of directors or certain officers; Election of directors;

           Appointment of Certain Officers; Compensatory Arrangements of Certain
           Officers

Upon closing of the Term Loan Facility and termination of the Prior Term Loan Facility, the March 2, 2022, Jill K. Frizzley and Richard D. Caruso resigned from the Company’s Board of Directors.

Item 5.03    Amendment to Articles of Incorporation of Bylaws; Change in Fiscal
             Year

Effective March 2, 2022the Company amended its articles of association to delete certain provisions added December 2019 together with the prior term loan facility. More specifically, the articles of association have been amended to remove the provisions providing that:

    ·   At all times at least two (2) members of the Board of Directors are
        designated as ("Special Directors"), which Special Directors shall not,
        and will not be, during the continuation of his or her service as a
        Special Director or has not been during for the five-year period prior to
        his or her appointment as a Special Director, (i) an employee,
        stockholder, or officer of the Company or any of its affiliates, (ii) a
        customer or supplier of the Company or any of its affiliates (other than
        an independent director provided by a corporate services company that
        provides independent directors in the ordinary course of its business), or
        (iii) any member of the immediate family of a person described in clause
        (i) or (ii). Vacancies caused by the death, resignation or removal of a
        Special Director may only be filled by another individual that satisfies
        the requirements for a Special Director.




    ·   Unless otherwise specified in the By-laws, a majority of the entire Board
        of Directors shall constitute a quorum for the transaction of business or
        of any specified item of business, which majority shall include at least
        one Special Director.




    ·   The Board of Directors may only authorize any amendment to the articles of
        incorporation of the Company by a majority vote of the then-serving
        members of the Board of Directors, which majority shall include the
        Special Directors. In addition, the Company may only institute a
        proceeding to adjudicate it bankrupt, consent to the filing of any
        bankruptcy proceeding against it, declare insolvency or otherwise decide
        to liquidate, wind up, reorganize, dissolve or conduct any similar action
        by a majority vote of the then-serving members of the Board of Directors,
        which majority shall include the Special Directors.




    ·   The Company may permit one or more board observers to attend meetings of
        the Board of Directors and the restructuring committee thereof.




    ·   The Board of Directors, by resolution adopted by a majority of the entire
        Board of Directors, shall appoint from among its members a restructuring
        committee consisting of the Chief Executive Officer and the Special
        Directors. The Chief Executive Officer serving on the restructuring
        committee shall act as chairman of the committee. All action by the
        restructuring committee shall be authorized by majority vote of its
        members. The restructuring committee shall have full authority (a) to
        commence, oversee and manage any process to (i) sell the Company's
        businesses and/or assets and/or (ii) consummate a refinancing transaction,
        and (b) to manage all aspects of the Company's restructuring efforts and
        strategies. The committee shall exercise such other powers as may be
        specifically delegated to it by the Board of Directors and act upon such
        matters as may be referred to it from time to time for study and
        recommendation by the Board of Directors or the Chief Executive Officer.




    ·   The Board of Directors may also appoint from among its own members such
        other committees as the Board of Directors may determine, which shall in
        each case consist of not less than two directors, which shall at least
        include the Special Directors, and which shall have such powers and duties
        as shall from time to time be prescribed by the Board of Directors.




    ·   The Board of Directors, by resolution adopted by a majority of the entire
        Board of Directors, may appoint from among its members an executive
        committee consisting of three or more directors, which shall at least
        include the Special Directors and either the Chief Executive Officer or
        the President.




    ·   The By-laws of the Corporation may also be amended or repealed by the
        Board of Directors, including any By-law adopted, amended, or repealed by
        the shareholders generally, by a majority vote of the then-serving members
        of the Board of Directors, which majority shall include the Special
        Directors.

The foregoing description of the Amended and Restated Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended and Restated Bylaws filed as Exhibit 3.1 to this Report.

                                       5


Item 8.01 Other Events

At March 2, 2022, the Company has issued a press release announcing certain of the matters described in this Current Report on Form 8-K. A copy of the aforementioned press release is attached hereto as Exhibit 99.1.

Item 9.01 Financial statements and supporting documents

(d)      Exhibits

Part number Part name

  3.1       Amended and Restated Bylaws of Hudson Technologies, Inc.

  10.1      Credit Agreement dated March 2, 2022 by and among TCW Asset
          Management Company LLC, as Agent, Hudson Technologies, Inc., and the
          Borrowers and Lenders party thereto

  10.2      Guaranty and Security Agreement dated March 2, 2022 by and among
          the Grantors named therein and TCW Asset Management Company LLC, as
          Agent

  10.3      Amended and Restated Credit Agreement dated March 2, 2022 by and
          among Wells Fargo Bank, National Association, as Agent, Hudson
          Technologies, Inc., and the Borrowers and Lenders party thereto

  10.4      First Amendment to Guaranty and Security Agreement dated March 2,
          2022 by and among the Grantors named therein and Wells Fargo Bank,
          National Association, as Agent

  99.1      Press Release dated March 2, 2022

104       Cover Page Interactive Data File (embedded within the Inline XBRL
          document)




                                       6

© Edgar Online, source Previews