Hudson (HDSN) 10-Q7 Nov 232023 Q3 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2023	Nov. 07, 2023
Document Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2023
Entity File Number	1-13412
Entity Registrant Name	HUDSON TECHNOLOGIES INC /NY
Entity Incorporation, State or Country Code	NY
Entity Tax Identification Number	13-3641539
Entity Address, Address Line One	300 Tice Boulevard
Entity Address, Address Line Two	Suite 290
Entity Address, City or Town	Woodcliff Lake
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	07677
City Area Code	845
Local Phone Number	735-6000
Title of 12(b) Security	Common stock, $0.01 par value
Trading Symbol	HDSN
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		45,502,380
Amendment Flag	false
Entity Central Index Key	0000925528
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 3,783	$ 5,295
Trade accounts receivable - net	44,935	20,872
Inventories	139,231	145,377
Prepaid expenses and other current assets	10,143	5,289
Total current assets	198,092	176,833
Property, plant and equipment, less accumulated depreciation	20,570	20,568
Goodwill	47,803	47,803
Intangible assets, less accumulated amortization	15,469	17,564
Right of use asset	7,041	7,339
Other assets	2,418	2,386
Total Assets	291,393	272,493
Current liabilities:
Trade accounts payable	16,828	14,165
Accrued expenses and other current liabilities	30,260	27,908
Accrued payroll	5,030	6,303
Current maturities of long-term debt		4,250
Short-term debt	5,000
Total current liabilities	57,118	52,626
Deferred tax liability	4,524	244
Long-term lease liabilities	5,167	5,763
Long-term debt, less current maturities, net of deferred financing costs		38,985
Total Liabilities	66,809	97,618
Commitments and contingencies
Stockholders' equity:
Preferred stock, shares authorized 5,000,000: Series A Convertible preferred stock, $0.01 par value ($100 liquidation preference value); shares authorized 150,000; none issued or outstanding
Common stock, $0.01 par value; shares authorized 100,000,000; issued and outstanding 45,484,325 and 45,287,619, respectively	455	453
Additional paid-in capital	117,847	116,442
Accumulated retained earnings	106,282	57,980
Total Stockholders' Equity	224,584	174,875
Total Liabilities and Stockholders' Equity	$ 291,393	$ 272,493

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, issued	45,484,325	45,287,619
Common stock, outstanding	45,484,325	45,287,619
Preferred stock
Preferred stock, shares authorized	5,000,000	5,000,000
Series A Convertible Preferred Stock
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, liquidation preference value	$ 100	$ 100
Preferred stock, shares authorized	150,000	150,000
Preferred stock, issued	0	0

Consolidated Statements of Inco

Consolidated Statements of Income (unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Consolidated Statements of Income (unaudited)
Revenues	$ 76,496	$ 89,502	$ 244,169	$ 277,781
Cost of sales	45,916	45,263	146,632	130,225
Gross profit	30,580	44,239	97,537	147,556
Operating expenses:
Selling, general and administrative	6,760	7,219	22,010	21,057
Amortization	698	698	2,095	2,095
Total operating expenses	7,458	7,917	24,105	23,152
Operating income	23,122	36,322	73,432	124,404
Other expense:
Net interest expense	4,358	2,365	8,106	12,293
Income before income taxes	18,764	33,957	65,326	112,111
Income tax expense	5,182	4,601	17,024	13,390
Net income	$ 13,582	$ 29,356	$ 48,302	$ 98,721
Net income per common share - Basic	$ 0.30	$ 0.65	$ 1.07	$ 2.20
Net income per common share - Diluted	$ 0.29	$ 0.62	$ 1.02	$ 2.10
Weighted average number of shares outstanding - Basic	45,404,963	45,063,810	45,348,072	44,935,739
Weighted average number of shares outstanding - Diluted	47,345,380	47,181,424	47,319,464	47,053,010

Consolidated Statements of Stoc

Consolidated Statements of Stockholders' Equity (unaudited) - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Retained Earnings (Accumulated Deficit)	Total
Balance at Dec. 31, 2021	$ 448	$ 116,312	$ (45,821)	$ 70,939
Balance (in shares) at Dec. 31, 2021	44,758,925
Issuance of common stock upon exercise of stock options	$ 3	179		182
Issuance of common stock upon exercise of stock options (in shares)	311,443
Excess tax benefits from exercise of stock options		(83)		(83)
Stock compensation expense		830		830
Net income			98,721	98,721
Balance at Sep. 30, 2022	$ 451	117,238	52,900	170,589
Balance (in shares) at Sep. 30, 2022	45,070,368
Balance at Dec. 31, 2021	$ 448	116,312	(45,821)	70,939
Balance (in shares) at Dec. 31, 2021	44,758,925
Balance at Dec. 31, 2022	$ 453	116,442	57,980	174,875
Balance (in shares) at Dec. 31, 2022	45,287,619
Balance at Jun. 30, 2022	$ 450	116,943	23,544	140,937
Balance (in shares) at Jun. 30, 2022	45,020,087
Issuance of common stock upon exercise of stock options	$ 1	58		59
Issuance of common stock upon exercise of stock options (in shares)	50,281
Excess tax benefits from exercise of stock options		(10)		(10)
Stock compensation expense		247		247
Net income			29,356	29,356
Balance at Sep. 30, 2022	$ 451	117,238	52,900	170,589
Balance (in shares) at Sep. 30, 2022	45,070,368
Balance at Dec. 31, 2022	$ 453	116,442	57,980	174,875
Balance (in shares) at Dec. 31, 2022	45,287,619
Issuance of common stock upon exercise of stock options	$ 2	37		39
Issuance of common stock upon exercise of stock options (in shares)	196,706
Excess tax benefits from exercise of stock options		(693)		(693)
Stock compensation expense		2,061		2,061
Net income			48,302	48,302
Balance at Sep. 30, 2023	$ 455	117,847	106,282	224,584
Balance (in shares) at Sep. 30, 2023	45,484,325
Balance at Jun. 30, 2023	$ 454	118,296	92,700	211,450
Balance (in shares) at Jun. 30, 2023	45,375,598
Issuance of common stock upon exercise of stock options	$ 1	1		2
Issuance of common stock upon exercise of stock options (in shares)	108,727
Excess tax benefits from exercise of stock options		(690)		(690)
Stock compensation expense		240		240
Net income			13,582	13,582
Balance at Sep. 30, 2023	$ 455	$ 117,847	$ 106,282	$ 224,584
Balance (in shares) at Sep. 30, 2023	45,484,325

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Cash flows from operating activities:
Net income	$ 48,302	$ 98,721
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	2,213	2,455
Amortization of intangible assets	2,095	2,095
Lower of cost or net realizable value reserve	(2,195)	(1,155)
Allowance for doubtful accounts	800	1,711
Stock compensation expense	2,061	830
Amortization of deferred finance costs	669	2,152
Loss on extinguishment of debt	3,427	4,665
Deferred tax expense	4,280	(814)
Changes in assets and liabilities:
Trade accounts receivable	(24,863)	(26,156)
Inventories	8,341	(24,860)
Prepaid and other assets	(684)	(9,990)
Lease obligations	1	16
Income taxes receivable	(4,212)
Accounts payable and accrued expenses	3,283	10,346
Cash provided by operating activities	43,518	60,016
Cash flows from investing activities:
Additions to property, plant, and equipment	(2,215)	(1,715)
Cash used in investing activities	(2,215)	(1,715)
Cash flows from financing activities:
Proceeds from issuance of common stock	39	182
Excess tax benefits from exercise of stock options	(693)	(83)
Payment of deferred financing cost		(8,512)
Borrowing of short-term debt - net	5,000
Proceeds from long-term debt		100,000
Repayment of long-term debt	(47,161)	(138,331)
Cash used in financing activities	(42,815)	(46,744)
(Decrease) increase in cash and cash equivalents	(1,512)	11,557
Cash and cash equivalents at beginning of period	5,295	3,492
Cash and cash equivalents at end of period	3,783	15,049
Supplemental Disclosure of Cash Flow Information:
Cash paid during period for interest	4,232	10,100
Cash paid for income taxes - net	$ 16,955	$ 9,791

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
Summary of Significant Accounting Policies	Sep. 30, 2023
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 1 - Summary of Significant Accounting Policies Business Hudson Technologies, Inc. (“Hudson” or the “Company”), incorporated under the laws of New York on January 11, 1991, is a refrigerant services company providing innovative solutions to recurring problems within the refrigeration industry. Hudson has proven, reliable programs that meet customer refrigerant needs by providing environmentally sustainable solutions from initial sale of refrigerant gas through recovery, reclamation and reuse, peak operating performance of equipment through energy efficiency and emergency air conditioning and refrigeration system repair, to final refrigerant disposal and carbon credit trading. The Company’s operations consist of one reportable segment. The Company’s products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems, and include refrigerant and industrial gas sales, refrigerant management services consisting primarily of reclamation of refrigerants and RefrigerantSide® Services performed at a customer’s site. RefrigerantSide® Services consist of system decontamination to remove moisture, oils and other contaminants intended to restore systems to designed capacity. In addition, the Company’s SmartEnergy OPS® service is a web-based real time continuous monitoring service applicable to a facility’s refrigeration systems and other energy systems. The Company’s Chiller Chemistry® and Chill Smart® services are also predictive and diagnostic service offerings. As a component of the Company’s products and services, the Company also participates in the generation of carbon offset projects. The Company operates principally through its wholly-owned subsidiary, Hudson Technologies Company. Unless the context requires otherwise, references to the “Company”, “Hudson”, “we”, “us”, “our”, or similar pronouns refer to Hudson Technologies, Inc. and its subsidiaries. In preparing the accompanying consolidated financial statements, and in accordance with Accounting Standards Codification (“ASC”) 855-10 “Subsequent Events”, the Company’s management has evaluated subsequent events through the date that the financial statements were filed. The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial statements and with the instructions of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. The financial information included in this quarterly report should be read in conjunction with the Company’s audited financial statements and related notes thereto for the year ended December 31, 2022. Operating results for the nine-month period ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. In the opinion of management, all estimates and adjustments considered necessary for a fair presentation have been included and all such adjustments were normal and recurring. AIM Act On September 23, 2021, the United States Environmental Protection Agency (“EPA”) issued the final rule establishing the framework to allocate allowances for virgin production and consumption of hydrofluorocarbon refrigerants (“HFCs”). The EPA is responsible for the administration of the HFC phase down enacted by Congress under the AIM Act. The AIM Act directs the EPA to address the reduction in virgin HFCs and provides authority to do so in three respects: 1) phase down the production and consumption of listed HFCs, 2) manage these HFCs and their substitutes including reclamation of refrigerants, and 3) facilitate the transition to next-generation technologies. Congress required that the EPA consider ways to promote reclamation in all phases of its implementation of the AIM Act. The AIM Act introduces a stepdown of 10% from baseline levels in 2022 and 2023, and establishes a cumulative 40% reduction in the baseline for 2024. Hudson received allocation allowances for calendar years 2022 and 2023 equal to approximately 3 million Metric Tons Exchange Value Equivalents per year, or approximately 1% of the total HFC consumption, with allowances for future periods to be determined at a later date. Reclamation will be critical to maintaining necessary HFC supply levels to ensure an orderly phasedown. On October 6, 2023, the EPA announced the latest actions to phase down HFCs under the AIM Act: 1) The first new action is a final rule to accelerate the ongoing transition to more efficient and climate-safe technologies in new refrigeration, heating and cooling systems and other products by restricting the use of HFCs where alternatives are already available. The rule, which applies to both imported and domestically manufactured products, bans HFCs in certain equipment and sets a limit on the global warming potentials (GWPs) of the HFCs that can be used in each subsector, with compliance dates ranging from 2025 to 2028. 2) The second action is a proposed rule (subject to further comments) to better manage and reuse existing HFCs, including by reducing wasteful leaks from equipment and supporting HFC recycling and reclamation. The proposed rule includes requirements for repairing leaky equipment, use of automatic leak detection systems on large refrigeration systems, use of reclaimed HFCs for certain applications, recovery of HFCs from cylinders before their disposal, and a container tracking system. Consolidation The consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, represent all companies of which Hudson directly or indirectly has majority ownership or otherwise controls. Significant intercompany accounts and transactions have been eliminated. The Company’s consolidated financial statements include the accounts of wholly-owned subsidiaries Hudson Holdings, Inc. and Hudson Technologies Company. The Company does not present a statement of comprehensive income as its comprehensive income is the same as its net income. Fair Value of Financial Instruments The carrying values of financial instruments including cash, trade accounts receivable and accounts payable approximate fair value at September 30, 2023 and December 31, 2022, because of the relatively short maturity of these instruments. The carrying value of debt approximates fair value, due to the variable rate nature of the debt, as of September 30, 2023 and December 31, 2022. See Note 2 for further details. Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of temporary cash investments and trade accounts receivable. The Company maintains its temporary cash investments in highly-rated financial institutions and, at times, the balances exceed FDIC insurance coverage. The Company’s trade accounts receivable are primarily due from companies throughout the United States. The Company reviews each customer’s credit history before extending credit. The Company establishes an allowance for doubtful accounts based on factors associated with the credit risk of specific accounts, historical trends, and other information. The carrying value of the Company’s accounts receivable is reduced by the established allowance for doubtful accounts. The allowance for doubtful accounts includes any accounts receivable balances that are determined to be uncollectible, along with a general reserve for the remaining accounts receivable balances. The Company adjusts its reserves based on factors that affect the collectability of the accounts receivable balances. For the nine month period ended September 30, 2023 there was one customer accounting for greater than 10% of the Company’s revenues and at September 30, 2023 there were $19.7 million of accounts receivable from this customer. For the nine-month period ended September 30, 2022 there was no customer accounting for 10% of the Company’s revenues. The loss of a principal customer or a decline in the economic prospects of and/or a reduction in purchases of the Company’s products or services by any such customer could have a material adverse effect on the Company’s operating results and financial position. Cash and Cash Equivalents Temporary investments with original maturities of ninety days or less are included in cash and cash equivalents. Inventories Inventories, consisting primarily of refrigerant products available for sale, are stated at the lower of cost, on a first-in first-out basis, or net realizable value. Where the market price of inventory is less than the related cost, the Company may be required to write down its inventory through a lower of cost or net realizable value adjustment, the impact of which would be reflected in cost of sales on the Consolidated Statements of Operations. Any such adjustment would be based on management’s judgment regarding future demand and market conditions and analysis of historical experience. Property, Plant and Equipment Property, plant and equipment are stated at cost, including internally manufactured equipment. The cost to complete equipment that is under construction is not considered to be material to the Company’s financial position. Provision for depreciation is recorded (for financial reporting purposes) using the straight-line method over the useful lives of the respective assets. Leasehold improvements are amortized on a straight-line basis over the shorter of economic life or terms of the respective leases. Costs of maintenance and repairs are charged to expense when incurred. Due to the specialized nature of the Company’s business, it is possible that the Company’s estimates of equipment useful life periods may change in the future. Goodwill The Company has made acquisitions that included a significant amount of goodwill and other intangible assets. The Company applies the purchase method of accounting for acquisitions, which among other things, requires the recognition of goodwill (which represents the excess of the purchase price of the acquisition over the fair value of the net assets acquired and identified intangible assets). The Company tests its goodwill for impairment annually on a qualitative or quantitative basis (on the first day of the fourth quarter) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of an asset below its carrying value. Goodwill is tested for impairment at the reporting unit level. When performing the annual impairment test, the Company has the option of first performing a qualitative assessment, which requires management to make assumptions affecting a reporting unit, to determine the existence of events and circumstances that would lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If such a conclusion is reached, the Company is then required to perform a quantitative impairment assessment of goodwill. The Company has one reporting unit at September 30, 2023. Other intangible assets that meet certain criteria are amortized over their estimated useful lives. An impairment charge is recorded based on the excess of a reporting unit’s carrying amount over its fair value. An impairment charge would be recognized when the carrying amount exceeds the estimated fair value of a reporting unit. These impairment evaluations use many assumptions and estimates in determining an impairment loss, including certain assumptions and estimates related to future earnings. If the Company does not achieve its earnings objectives, the assumptions and estimates underlying these impairment evaluations could be adversely affected, which could result in an asset impairment charge that would negatively impact operating results. During the fourth quarter of 2022, the Company completed its annual impairment test as of October 1 and determined in its qualitative assessment it is more likely than not that the fair value of the reporting unit is greater than its carrying amount, resulting in no goodwill impairment. There can be no assurances that future sustained declines in macroeconomic or business conditions affecting our industry will not occur, which could result in goodwill impairment charges in future periods. There were no goodwill impairment losses recognized in 2022 or the nine months ended September 30, 2023. Leases In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. The Company accounts for operating leases in accordance with ASU 2016-02. The Company’s accounting for finance leases remained substantially unchanged. See Note 5 for further details and current balances. Cylinder Deposit Liability The cylinder deposit liability, which is included in accrued expenses and other current liabilities on the Company’s Balance Sheet, represents the amount due to customers for the return of refillable cylinders. The Company’s Aspen Refrigerants division (“ARI”) charges its customers cylinder deposits upon the shipment of refrigerant gases that are contained in refillable cylinders. The amount charged to the customer by ARI approximates the cost of a new cylinder of the same size. Upon return of a cylinder, this liability is reduced. The cylinder deposit liability balance was $16.6 million and $13.6 million at September 30, 2023 and December 31, 2022, respectively. Revenues and Cost of Sales The Company’s products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems. Most of the Company’s revenues are realized from the sale of refrigerant and industrial gases and related products. The Company also generates revenue from refrigerant management services performed at a customer’s site and in-house. The Company conducts its business primarily within the US. The Company applies the FASB’s guidance on revenue recognition, which requires the Company to recognize revenue in an amount that reflects the consideration to which the Company expects to be entitled in exchange for goods or services transferred to its customers. In most instances, the Company’s contract with a customer is the customer’s purchase order and the sales price to the customer is fixed. For certain customers, the Company may also enter into a sales agreement outlining a framework of terms and conditions applicable to future purchase orders received from that customer. Because the Company’s contracts with customers are typically for a single customer purchase order, the duration of the contract is usually less than one year. The Company’s performance obligations related to product sales are satisfied at a point in time, which may occur upon shipment of the product or receipt by the customer, depending on the terms of the arrangement. The Company’s performance obligations related to reclamation and RefrigerantSide® services are generally satisfied at a point in time when the service is performed. Accordingly, revenues are recorded upon the shipment of the product, or in certain instances upon receipt by the customer, or the completion of the service. In July 2016 the Company was awarded, as prime contractor, a five-year contract, including a five-year renewal option, which has been exercised through July 2026, by the United States Defense Logistics Agency (“DLA”) for the management, supply, and sale of refrigerants, compressed gases, cylinders, and related services. Due to the contract containing multiple performance obligations, the Company assessed the arrangement in accordance with ASC 606-10-25-14. The Company determined that the sale of refrigerants and the management services provided under the contract each have stand-alone value. Accordingly, the performance obligation related to the sale of refrigerants is satisfied at a point in time, mainly when the customer receives and obtains control of the product. The performance obligation related to management service revenue is satisfied over time and revenue is recognized on a straight-line basis over the term of the arrangement as the management services are provided. Cost of sales is recorded based on the cost of products shipped or services performed and related direct operating costs of the Company’s facilities. In general, the Company performs shipping and handling services for its customers in connection with the delivery of refrigerant and other products. The Company elected to implement ASC 606-10-25-18B, whereby the Company accounts Income Taxes The Company is taxed at statutory corporate income tax rates after adjusting income reported for financial statement purposes for certain items. Current income tax expense reflects the tax results of revenues and expenses currently taxable or deductible. The Company utilizes the asset and liability method of accounting for deferred income taxes, which provides for the recognition of deferred tax assets or liabilities, based on enacted tax rates and laws, for the differences between the financial and income tax reporting bases of assets and liabilities. The tax benefit associated with the Company’s net operating loss carry forwards (“NOLs”) is recognized to the extent that the Company expects to realize future taxable income. During the year ended December 31, 2022, the Company concluded that its deferred tax assets were more likely than not to become realizable. The Company fully reversed its existing valuation allowance of $15.1 million, with $11.6 million reversed during the first and second quarters of 2022, and the remaining $3.5 million through the third and fourth quarters of 2022. The conclusion that a valuation allowance was no longer needed was based on the achievement of three years of cumulative pre-tax income, the utilization of the Company’s $29.3 million federal NOLs, which comprised a majority of the Company’s deferred tax assets, combined with estimates of future years’ pre-tax income that were sufficient to realize the remaining deferred tax assets. As of September 30, 2023, the Company had no federal NOLs, as the Company utilized all of its remaining federal NOLs during the year ended December 31, 2022. As of September 30, 2023, the Company had state tax NOLs of approximately $1.8 million, expiring in various years. We review the likelihood that we will realize the benefit of our deferred tax assets on a quarterly basis. The Company evaluates uncertain tax positions, if any, by determining if it is more likely than not to be sustained upon examination by the taxing authorities. As of September 30, 2023 and December 31, 2022, the Company believes it had no uncertain tax positions. Income per Common and Equivalent Shares If dilutive, common equivalent shares (common shares assuming exercise of options) utilizing the treasury stock method are considered in the presentation of diluted income per share. The reconciliation of shares used to determine net income per share is as follows (dollars in thousands, unaudited): Three Months Nine Months ended September 30, ended September 30, 2023 2022 2023 2022 Net income $ 13,582 $ 29,356 $ 48,302 $ 98,721 Weighted average number of shares – basic 45,404,963 45,063,810 45,348,072 44,935,739 Shares underlying options 1,940,417 2,117,614 1,971,392 2,117,271 Weighted average number of shares – diluted 47,345,380 47,181,424 47,319,464 47,053,010 During the three month periods ended September 30, 2023 and 2022, certain options aggregating 7,444 and 2,743 shares, respectively, have been excluded from the calculation of diluted shares, due to the fact that their effect would be anti-dilutive. During the nine month periods ended September 30, 2023 and 2022, certain options aggregating 7,444 and 2,980 shares, respectively, have been excluded from the calculation of diluted shares, due to the fact that their effect would be anti-dilutive. Estimates and Risks The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the use of estimates and assumptions that affect the amounts reported in these financial statements and footnotes. The Company considers these accounting estimates to be critical in the preparation of the accompanying consolidated financial statements. The Company uses information available at the time the estimates are made. However, these estimates could change materially if different information or assumptions were used. Additionally, these estimates may not ultimately reflect the actual amounts of the final transactions that occur. The Company utilizes both internal and external sources to evaluate potential current and future liabilities for various commitments and contingencies. In the event that the assumptions or conditions change in the future, the estimates could differ from the original estimates. Several of the Company’s accounting policies involve significant judgments, uncertainties, and estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. To the extent that actual results differ from management’s judgments and estimates, there could be a material adverse effect on the Company. On a continuous basis, the Company evaluates its estimates, including, but not limited to, those estimates related to its allowance for doubtful accounts, inventory reserves, goodwill and commitments and contingencies. With respect to trade accounts receivable, the Company estimates the necessary allowance for doubtful accounts based on both historical and anticipated trends of payment history and the ability of the customer to fulfill its obligations. For inventory, the Company evaluates both current and anticipated sales prices of its products to determine if a write down of inventory to net realizable value is necessary. The Company participates in an industry that is highly regulated, and changes in the regulations affecting its business could affect its operating results. Currently the Company purchases virgin hydrofluorocarbon (“HFC”) and hydrofluroolefin (“HFO”) refrigerants and reclaimable, primarily hydrochlorofluorocarbons (“HCFC”), HFC and chlorofluorocarbon (“CFC”), refrigerants from suppliers and its customers. To the extent that the Company is unable to source sufficient quantities of refrigerants or is unable to obtain refrigerants on commercially reasonable terms or experiences a decline in demand and/or price for refrigerants sold by the Company, the Company could realize reductions in revenue from refrigerant sales, which could have a material adverse effect on its operating results and its financial position. The process of sourcing refrigerants includes various procurement costs, such as freight, processing, insurance, and other costs, relating to the delivery of refrigerants. As a result of the recently noted global supply chain issues, the Company determined it could be exposed to incremental costs related to these refrigerant purchases. These costs represent the Company’s initial estimate that are possibly subject to finalization in future periods and are recorded in accrued expenses and other current liabilities on the consolidated balance sheet as of September 30, 2023. The Company is subject to various legal proceedings. The Company assesses the merit and potential liability associated with each of these proceedings. In addition, the Company estimates potential liability, if any, related to these matters. To the extent that these estimates are not accurate, or circumstances change in the future, the Company could realize liabilities, which could have a material adverse effect on its operating results and its financial position. Impairment of Long-lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less the cost to sell. Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments, which revises guidance for the accounting for credit losses on financial instruments within its scope, and in November 2018, issued ASU No. 2018-19 and in April 2019, issued ASU No. 2019-04 and in May 2019, issued ASU No. 2019-05, and in November 2019, issued ASU No. 2019-11, which each amended the standard. The new standard introduces an approach, based on expected losses, to estimate credit losses on certain types of financial instruments and modifies the impairment model for available-for-sale debt securities. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities, net investments in leases and off-balance-sheet credit exposures. This ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, with early adoption permitted. Entities are required to apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. The Company adopted ASU No. 2016-13 on January 1, 2023. The adoption of ASU No. 2016-13 did not have a material impact on its results of operations or financial position. In August 2020, the FASB issued ASU 2020-06, “Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, which is intended to simplify the accounting for convertible instruments by removing certain separation models in Subtopic 470-20, Debt-Debt with Conversion and Other Options, for convertible instruments. The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU 2020-06 on January 1, 2023. The adoption of ASU 2020-06 did not have a material impact on its results of operations or financial position.

Fair Value

Fair Value	9 Months Ended
Fair Value	Sep. 30, 2023
Fair Value
Fair Value	Note 2 - Fair Value ASC Subtopic 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable inputs. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based upon observable inputs used in the valuation techniques, the Company is required to provide information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values into three broad levels as follows: Level 1: Valuations for assets and liabilities traded in active markets from readily available pricing sources for market transactions involving identical assets or liabilities. Level 2: Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third-party pricing services for identical or similar assets or liabilities. Level 3: Valuations for assets and liabilities include certain unobservable inputs in the assumptions and projections used in determining the fair value assigned to such assets or liabilities. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Inventories

Inventories	9 Months Ended
Inventories	Sep. 30, 2023
Inventories
Inventories	Note 3 - Inventories Inventories consist of the following: September 30, December 31, 2023 2022 (unaudited) (in thousands) Refrigerants and cylinders $ 144,123 $ 152,840 Less: net realizable value adjustments (4,892) (7,463) Total $ 139,231 $ 145,377

Property, plant and equipment

Property, plant and equipment	9 Months Ended
Property, plant and equipment	Sep. 30, 2023
Property, plant and equipment
Property, plant and equipment	Note 4 - Property, plant and equipment Elements of property, plant and equipment are as follows: September 30, December 31, Estimated 2023 2022 Lives (in thousands) (unaudited) Property, plant and equipment - Land $ 1,255 $ 1,255 - Land improvements 319 319 6-10 years - Buildings 1,446 1,446 25-39 years - Building improvements 3,467 3,396 25-39 years - Cylinders 13,300 13,315 15-30 years - Equipment 28,920 27,258 3-10 years - Equipment under capital lease 315 315 5-7 years - Vehicles 1,789 1,773 3-5 years - Lab and computer equipment, software 3,233 3,103 2-8 years - Furniture & fixtures 933 840 5-10 years - Leasehold improvements 865 852 3-5 years - Construction-in-progress 3,741 3,533 Subtotal 59,583 57,405 Less: Accumulated depreciation (39,013) (36,837) Total $ 20,570 $ 20,568 Depreciation expense for the nine months ended September 30, 2023 and 2022 was $2.2 million and $2.5 million, respectively.

Leases

Leases	9 Months Ended
Leases	Sep. 30, 2023
Leases
Leases	Note 5 - Leases The Company has various lease agreements with terms up to 11 years, including leases of buildings and various equipment. Some leases include options to purchase, terminate or extend for one or more years. These options are included in the lease term when it is reasonably certain that the option will be exercised. At inception, the Company determines if an arrangement contains a lease and whether that lease meets the classification criteria of a finance or operating lease. Some of the Company’s lease arrangements contain lease components (e.g. minimum rent payments) and non-lease components (e.g. common area maintenance, charges, utilities and property taxes). The Company elected the package of practical expedients permitted under the transition guidance, which allows it to carry forward its historical lease classification, its assessment on whether a contract contains a lease, and its initial direct costs for any leases that existed prior to the adoption of the new standard. The Company also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of operations on a straight-line basis over the lease term. The Company’s lease agreements do not contain any material residual value, guarantees or material restrictive covenants. Operating leases are included in Right of use asset, Accrued expenses and other current liabilities, and Long-term lease liabilities on the consolidated balance sheets. These assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company’s secured incremental borrowing rates or implicit rates, when readily determinable. Short-term operating leases, which have an initial term of 12 months or less, are not recorded on the balance sheet. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Variable lease expense is recognized in the period in which the obligation for those payments is incurred. Operating lease expense of $2.1 million and $1.9 million, for the nine months ended September 30, 2023 and 2022, respectively, is included in Selling, general and administrative expenses on the consolidated statements of operations. The following table presents information about the amount, timing and uncertainty of cash flows arising from the Company’s operating leases as of September 30, 2023. September 30, Maturity of Lease Payments 2023 (in thousands) (unaudited) 2023 (remaining) $ 1,291 -2024 2,372 -2025 2,173 -2026 1,283 -2027 799 -Thereafter 960 Total undiscounted operating lease payments 8,878 Less imputed interest (1,739) Present value of operating lease liabilities $ 7,139 Balance Sheet Classification September 30, 2023 (in thousands) (unaudited) Current lease liabilities (recorded in Accrued expenses and other current liabilities) $ 1,972 Long-term lease liabilities 5,167 Total operating lease liabilities $ 7,139 Other Information September 30, 2023 Weighted-average remaining term for operating leases 3.07 years Weighted-average discount rate for operating leases 8.24 % Cash Flows Cash paid for amounts included in the present value of operating lease liabilities during the nine months ended September 30, 2023 and 2022 was $2.1 million and $1.9 million, respectively and is included in operating cash flows.

Goodwill and intangible assets

Goodwill and intangible assets	9 Months Ended
Goodwill and intangible assets	Sep. 30, 2023
Goodwill and intangible assets
Goodwill and intangible assets	Note 6 - Goodwill and intangible assets Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in business combinations accounted for under the purchase method of accounting. There were no goodwill impairment losses recognized for the nine-month period ended September 30, 2023, and year ended December 31, 2022. Based on the results of the impairment assessments of goodwill and intangible assets performed, management concluded that the fair value of the Company’s goodwill exceeds the carrying value and that there are no impairment indicators related to intangible assets. At September 30, 2023 and December 31, 2022 the Company had $47.8 million of goodwill. The Company’s other intangible assets consist of the following: September 30, 2023 December 31, 2022 (unaudited) Amortization Gross Gross Period Carrying Accumulated Carrying Accumulated (in thousands) (in years) Amount Amortization Net Amount Amortization Net Intangible assets with determinable lives Covenant not to compete 6 – 10 870 776 94 870 710 160 Customer relationships 3 – 12 31,560 16,486 15,074 31,560 14,491 17,069 Above market leases 13 567 266 301 567 232 335 Total identifiable intangible assets $ 32,997 $ 17,528 $ 15,469 $ 32,997 $ 15,433 $ 17,564 Amortization expense for the nine months ended September 30, 2023 and 2022 was $2.1 million for both periods. Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable.

Share-based compensation

Share-based compensation	9 Months Ended
Share-based compensation	Sep. 30, 2023
Share-based compensation
Share-based compensation	Note 7 - Share-based compensation Share-based compensation represents the cost related to share-based awards, typically stock options or stock grants, granted to employees, non-employees, officers and directors. Share-based compensation is measured at grant date, based on the estimated aggregate fair value of the award on the grant date, and such amount is charged to compensation expense on a straight-line basis (net of estimated forfeitures) over the requisite service period. For the nine month periods ended September 30, 2023 and 2022, share-based compensation expense of $2.1 million and $0.8 million, respectively, is reflected in Selling, general and administrative expenses in the consolidated Income Statements. Share-based awards have historically been made as stock options, and recently also as stock grants, issued pursuant to the terms of the Company’s stock option and stock incentive plans (collectively, the “Plans”), described below. The Plans may be administered by the Board of Directors or the Compensation Committee of the Board or by another committee appointed by the Board from among its members as provided in the Plans. Presently, the Plans are administered by the Company’s Compensation Committee of the Board of Directors. As of September 30, 2023 there were an aggregate of 4,350,191 shares of the Company’s common stock available under the Plans for issuance for future stock option grants or other stock based awards. Stock option awards, which allow the recipient to purchase shares of the Company’s common stock at a fixed price, are typically granted at an exercise price equal to the Company’s stock price at the date of grant. Typically, the Company’s stock option awards have vested from immediately to two years from the grant date and have had a contractual term ranging from three Effective September 17, 2014, the Company adopted its 2014 Stock Incentive Plan (“2014 Plan”) pursuant to which 3,000,000 shares of common stock were reserved for issuance (i) upon the exercise of options, designated as either ISOs under the Code or nonqualified options, or (ii) as stock, deferred stock or other stock-based awards. ISOs may be granted under the 2014 Plan to employees and officers of the Company. Non-qualified options, stock, deferred stock or other stock-based awards may be granted to consultants, directors (whether or not they are employees), employees or officers of the Company. Stock appreciation rights may also be issued in tandem with stock options. Unless the 2014 Plan is sooner terminated, the ability to grant options or other awards under the 2014 Plan will expire on September 17, 2024. Effective June 7, 2018, the Company adopted its 2018 Stock Incentive Plan (“2018 Plan”) pursuant to which 4,000,000 shares of common stock were reserved for issuance (i) upon the exercise of options, designated as either ISOs under the Code or nonqualified options, or (ii) as stock, deferred stock or other stock-based awards. ISOs may be granted under the 2018 Plan to employees and officers of the Company. Non-qualified options, stock, deferred stock or other stock-based awards may be granted to consultants, directors (whether or not they are employees), employees or officers of the Company. Stock appreciation rights may also be issued in tandem with stock options. Unless the 2018 Plan is sooner terminated, the ability to grant options or other awards under the 2018 Plan will expire on June 7, 2028. Effective June 11, 2020, the Company adopted its 2020 Stock Incentive Plan (“2020 Plan”) pursuant to which 3,000,000 shares of common stock were reserved for issuance (i) upon the exercise of options, designated as either ISOs under the Code or nonqualified options, or (ii) as stock, deferred stock or other stock-based awards. ISOs may be granted under the 2020 Plan to employees and officers of the Company. Non-qualified options, stock, deferred stock or other stock-based awards may be granted to consultants, directors (whether or not they are employees), employees or officers of the Company. Stock appreciation rights may also be issued in tandem with stock options. Unless the 2020 Plan is sooner terminated, the ability to grant options or other awards under the 2020 Plan will expire on June 11, 2030. All stock options have been granted to employees and non-employees at exercise prices equal to or in excess of the market value on the date of the grant. The Company determines the fair value of share-based awards at the grant date by using the Black-Scholes option-pricing model, and has utilized the simplified method to compute expected lives of share-based awards. There were options to purchase 592,798 and 379,070 shares of common stock granted during the nine month periods ended September 30, 2023 and 2022, respectively. A summary of the activity for stock options issued under the Company’s Plans for the indicated periods is presented below: Weighted Average Exercise Stock Option Plan Totals Shares Price Outstanding at December 31, 2021 2,604,023 $ 1.03 -Cancelled (11,781) $ 3.75 -Exercised (583,273) $ 1.15 -Granted (1) 381,181 $ 4.33 Outstanding at December 31, 2022 2,390,150 $ 1.51 -Cancelled (26,150) $ 9.62 -Exercised (275,405) $ 2.68 -Granted (2) 592,798 $ 10.02 Outstanding at September 30, 2023, unaudited 2,681,393 $ 3.26 (1) Options to purchase 381,181 shares were granted in 2022, of which options to purchase 40,588 shares vested immediately in 2022 and the remainder vested 50 % immediately and 50 % one year after the date of the grants. (2) Options to purchase 575,098 shares were granted in 2023, of which options to purchase 337,727 shares vested immediately in 2023 and the remainder vested 50 % immediately and 50% one year after the date of the grants. In addition, 17,700 stock appreciation rights were granted in January 2023 with a nine - month vesting period. The following is the weighted average contractual life in years and the weighted average exercise price at September 30, 2023 of: Weighted Average Weighted Remaining Average Number of Contractual Exercise Options Life Price Options outstanding and vested 2,444,022 4.64 years $ 2.60 The intrinsic value of options outstanding at September 30, 2023 and December 31, 2022 was $26.9 million and $20.6 million, respectively. The intrinsic value of options unvested at September 30, 2023 and December 31, 2022 was $0.8 million and $1.1 million, respectively. The intrinsic value of options exercised during the nine months ended September 30, 2023 and 2022 was $2.3 million and $2.1 million, respectively.

Short-term and Long-term debt

Short-term and Long-term debt	9 Months Ended
Short-term and Long-term debt	Sep. 30, 2023
Short-term and Long-term debt
Short-term and Long-term debt	Note 8 - Short-term and Long-term debt Elements of short-term and long-term debt are as follows: September 30, December 31, 2023 2022 (in thousands) (unaudited) Short-term & long-term debt Short-term debt: - Revolving credit line and other debt $ 5,000 $ — - Term loan facility – current — 4,250 Subtotal 5,000 4,250 Long-term debt: - Term loan facility- net of current portion of long-term debt — 27,563 - FILO term loan — 15,000 - Less: deferred financing costs on term loan — (3,578) Subtotal — 38,985 Total short-term & long-term debt $ 5,000 $ 43,235 Revolving Credit Facility On March 2, 2022, Hudson Technologies Company (“HTC”) and Hudson Holdings, Inc. (“Holdings”), as borrowers (collectively, the “Borrowers”), and Hudson Technologies, Inc (the “Company”) as a guarantor, entered into an Amended and Restated Credit Agreement (the “Amended Wells Fargo Facility”) with Wells Fargo Bank, National Association, as administrative agent and lender (“Agent” or “Wells Fargo”) and such other lenders as have or may thereafter become a party to the Amended Wells Fargo Facility. The Amended Wells Fargo facility amended and restated the prior Wells Fargo Facility entered into on December 19, 2019. Under the terms of the Amended Wells Fargo Facility, the Borrowers may borrow up to $90 million consisting of: (i) $15 million immediately borrowed in the form of a “first in last out” term loan (the “FILO Tranche”) and (ii) 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 contains 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. Amounts borrowed under the Amended Wells Fargo Facility may be used for working capital needs, certain permitted acquisitions, and to reimburse drawings under letters of credit. Interest under the Amended Wells Fargo Facility is payable in arrears on the first day of each month. Interest charges with respect to Revolving Loans are computed on the actual principal amount of Revolving Loans outstanding at a rate per annum equal to (A) with respect to Base Rate loans, the sum of (i) a rate per annum equal to the higher of (1) 1.0%, (2) the federal funds rate plus 0.5%, (3) one month term SOFR plus 1.0%, and (4) the prime commercial lending rate of Wells Fargo, plus (ii) between 1.25% and 1.75% depending on average monthly undrawn availability and (B) with respect to SOFR loans, the sum of the applicable SOFR rate plus between 2.36% and 2.86% depending on average quarterly undrawn availability. Interest charges with respect to the FILO Tranche were computed on the actual principal amount of FILO Tranche loans outstanding at a rate per annum equal to (A) with respect to Base Rate FILO Tranche loans, the sum of (i) a rate per annum equal to the higher of (1) 1.0%, (2) the federal funds rate plus 0.5%, (3) one month term SOFR plus 1.0%,and (4) the prime commercial lending rate of Wells Fargo, plus (ii) 6.5% and (B) with respect to SOFR FILO Tranche loans, the sum of the applicable SOFR rate plus 7.50%. The Amended Wells Fargo Facility also includes a monthly unused line fee ranging from 0.35% to 0.75% per annum determined based upon the level of average Revolving Loans outstanding during the immediately preceding month measured against the total Revolving Loans that may be borrowed under the Amended Wells Fargo Facility. In connection with the closing of the Amended Wells Fargo Facility, the Company also entered into a First Amendment to Guaranty and Security Agreement, dated as of March 2, 2022 (the “Amended Revolver Guaranty and Security Agreement”), pursuant to which the Company and certain subsidiaries are continuing to unconditionally guarantee the payment and performance of all obligations owing by Borrowers to Wells Fargo, as Agent for the benefit of the revolving lenders. Pursuant to the Amended Revolver Guaranty and Security Agreement, Borrowers, the Company and certain other subsidiaries are continuing to grant to the Agent, for the benefit of the Wells Fargo Facility lenders, a security interest in substantially all of their respective assets, including receivables, equipment, general intangibles (including intellectual property), inventory, subsidiary stock, real property, and certain other assets. 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 two The Amended Wells Fargo Facility also contains customary non-financial covenants relating to the Company and the Borrowers, including limitations on Borrowers’ ability to pay dividends on common stock or preferred stock, and also includes certain events of default, including payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to other obligations, events of bankruptcy and insolvency, certain ERISA events, judgments in excess of specified amounts, impairments to guarantees and a change of control. The Company evaluated the Amended Wells Fargo Facility in accordance with the provisions of ASC 470 to determine if the amendment was a modification or an extinguishment of debt and concluded that the amendment was a modification of the original revolving credit facility for accounting purposes. As a result, the Company capitalized an additional $0.9 million of deferred financing costs in connection with the amendment, which, along with the $0.2 million of remaining deferred financing costs of the original revolving facility, is being amortized over the five year term of the Amended Wells Fargo Facility. The commitments under the Amended Wells Fargo Facility will expire and the full outstanding principal amount of the loans, together with accrued and unpaid interest, are due and payable in full on March 2, 2027, unless the commitments are terminated and the outstanding principal amount of the loans are accelerated sooner following an event of default or in the event of certain other cross-defaults. Termination of 2022 Term Loan Facility On March 2, 2022, Hudson Technologies Company (“HTC”), an indirect subsidiary of Hudson Technologies, Inc. (the “Company”), and the Company’s subsidiary Hudson Holdings, Inc., as borrowers (collectively, the “Borrowers”), and the Company, as guarantor, became obligated under a Credit Agreement (the “Term Loan Facility”) with TCW Asset Management Company LLC, as administrative agent (“Term Loan Agent”) and the lender parties thereto (the “Term Loan Lenders”). Under the terms of the Term Loan Facility, the Borrowers immediately borrowed $85 million pursuant to a term loan (the “Term Loan”), which matures in March 2027. 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 corporate purposes. The Company paid approximately $4.3 million of term loan deferred financing costs. During the third quarter of 2023, the Company repaid in full the remaining principal balance outstanding under the Term Loan Facility and the FILO Tranche. Termination of Prior Term Loan Facility In conjunction with entry into the new Term Loan Facility as described above, on March 2, 2022 the Company’s then-existing term loans, as amended (the “Prior Term Loan Facility”), which had a principal balance of approximately $63.9 million after payment of a $16.0 million excess cash flow amount thereunder, were repaid in full, together with associated required lender fees and expenses of $3.3 million, and the Prior Term Loan Facility was terminated. The termination of the Prior Term Loan Facility constituted an extinguishment of debt, which resulted in the Company recording an additional $4.6 million of interest expense during the first quarter of 2022, which included the aforementioned $3.3 million of prior lender fees and expenses and $1.3 million of pre-existing deferred financing costs from the Prior Term Loan Facility. During the third quarter of 2023, the Company repaid in full the remaining $32.5 million principal balance outstanding under its Term Loan Facility and the FILO Tranche. In conjunction with this payoff, the Company recorded $3.4 million of interest which included a non-cash write off of $3.1 million deferred financing costs and $0.3 million of other expense and fees. The Company was in compliance with all covenants under the Amended Wells Fargo Facility as of September 30, 2023. The Company’s ability to comply with these covenants in future quarters may be affected by events beyond the Company’s control, including general economic conditions, weather conditions, regulations and refrigerant pricing. Therefore, the Company cannot make any assurance that it will continue to be in compliance during future periods. 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(R) 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 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.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
Summary of Significant Accounting Policies (Policies)	Sep. 30, 2023
Summary of Significant Accounting Policies
Business	Business Hudson Technologies, Inc. (“Hudson” or the “Company”), incorporated under the laws of New York on January 11, 1991, is a refrigerant services company providing innovative solutions to recurring problems within the refrigeration industry. Hudson has proven, reliable programs that meet customer refrigerant needs by providing environmentally sustainable solutions from initial sale of refrigerant gas through recovery, reclamation and reuse, peak operating performance of equipment through energy efficiency and emergency air conditioning and refrigeration system repair, to final refrigerant disposal and carbon credit trading. The Company’s operations consist of one reportable segment. The Company’s products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems, and include refrigerant and industrial gas sales, refrigerant management services consisting primarily of reclamation of refrigerants and RefrigerantSide® Services performed at a customer’s site. RefrigerantSide® Services consist of system decontamination to remove moisture, oils and other contaminants intended to restore systems to designed capacity. In addition, the Company’s SmartEnergy OPS® service is a web-based real time continuous monitoring service applicable to a facility’s refrigeration systems and other energy systems. The Company’s Chiller Chemistry® and Chill Smart® services are also predictive and diagnostic service offerings. As a component of the Company’s products and services, the Company also participates in the generation of carbon offset projects. The Company operates principally through its wholly-owned subsidiary, Hudson Technologies Company. Unless the context requires otherwise, references to the “Company”, “Hudson”, “we”, “us”, “our”, or similar pronouns refer to Hudson Technologies, Inc. and its subsidiaries. In preparing the accompanying consolidated financial statements, and in accordance with Accounting Standards Codification (“ASC”) 855-10 “Subsequent Events”, the Company’s management has evaluated subsequent events through the date that the financial statements were filed. The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial statements and with the instructions of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. The financial information included in this quarterly report should be read in conjunction with the Company’s audited financial statements and related notes thereto for the year ended December 31, 2022. Operating results for the nine-month period ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. In the opinion of management, all estimates and adjustments considered necessary for a fair presentation have been included and all such adjustments were normal and recurring. AIM Act On September 23, 2021, the United States Environmental Protection Agency (“EPA”) issued the final rule establishing the framework to allocate allowances for virgin production and consumption of hydrofluorocarbon refrigerants (“HFCs”). The EPA is responsible for the administration of the HFC phase down enacted by Congress under the AIM Act. The AIM Act directs the EPA to address the reduction in virgin HFCs and provides authority to do so in three respects: 1) phase down the production and consumption of listed HFCs, 2) manage these HFCs and their substitutes including reclamation of refrigerants, and 3) facilitate the transition to next-generation technologies. Congress required that the EPA consider ways to promote reclamation in all phases of its implementation of the AIM Act. The AIM Act introduces a stepdown of 10% from baseline levels in 2022 and 2023, and establishes a cumulative 40% reduction in the baseline for 2024. Hudson received allocation allowances for calendar years 2022 and 2023 equal to approximately 3 million Metric Tons Exchange Value Equivalents per year, or approximately 1% of the total HFC consumption, with allowances for future periods to be determined at a later date. Reclamation will be critical to maintaining necessary HFC supply levels to ensure an orderly phasedown. On October 6, 2023, the EPA announced the latest actions to phase down HFCs under the AIM Act: 1) The first new action is a final rule to accelerate the ongoing transition to more efficient and climate-safe technologies in new refrigeration, heating and cooling systems and other products by restricting the use of HFCs where alternatives are already available. The rule, which applies to both imported and domestically manufactured products, bans HFCs in certain equipment and sets a limit on the global warming potentials (GWPs) of the HFCs that can be used in each subsector, with compliance dates ranging from 2025 to 2028. 2) The second action is a proposed rule (subject to further comments) to better manage and reuse existing HFCs, including by reducing wasteful leaks from equipment and supporting HFC recycling and reclamation. The proposed rule includes requirements for repairing leaky equipment, use of automatic leak detection systems on large refrigeration systems, use of reclaimed HFCs for certain applications, recovery of HFCs from cylinders before their disposal, and a container tracking system.
Consolidation	Consolidation The consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, represent all companies of which Hudson directly or indirectly has majority ownership or otherwise controls. Significant intercompany accounts and transactions have been eliminated. The Company’s consolidated financial statements include the accounts of wholly-owned subsidiaries Hudson Holdings, Inc. and Hudson Technologies Company. The Company does not present a statement of comprehensive income as its comprehensive income is the same as its net income.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying values of financial instruments including cash, trade accounts receivable and accounts payable approximate fair value at September 30, 2023 and December 31, 2022, because of the relatively short maturity of these instruments. The carrying value of debt approximates fair value, due to the variable rate nature of the debt, as of September 30, 2023 and December 31, 2022. See Note 2 for further details.
Credit Risk	Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of temporary cash investments and trade accounts receivable. The Company maintains its temporary cash investments in highly-rated financial institutions and, at times, the balances exceed FDIC insurance coverage. The Company’s trade accounts receivable are primarily due from companies throughout the United States. The Company reviews each customer’s credit history before extending credit. The Company establishes an allowance for doubtful accounts based on factors associated with the credit risk of specific accounts, historical trends, and other information. The carrying value of the Company’s accounts receivable is reduced by the established allowance for doubtful accounts. The allowance for doubtful accounts includes any accounts receivable balances that are determined to be uncollectible, along with a general reserve for the remaining accounts receivable balances. The Company adjusts its reserves based on factors that affect the collectability of the accounts receivable balances. For the nine month period ended September 30, 2023 there was one customer accounting for greater than 10% of the Company’s revenues and at September 30, 2023 there were $19.7 million of accounts receivable from this customer. For the nine-month period ended September 30, 2022 there was no customer accounting for 10% of the Company’s revenues. The loss of a principal customer or a decline in the economic prospects of and/or a reduction in purchases of the Company’s products or services by any such customer could have a material adverse effect on the Company’s operating results and financial position.
Cash and Cash Equivalents	Cash and Cash Equivalents Temporary investments with original maturities of ninety days or less are included in cash and cash equivalents.
Inventories	Inventories Inventories, consisting primarily of refrigerant products available for sale, are stated at the lower of cost, on a first-in first-out basis, or net realizable value. Where the market price of inventory is less than the related cost, the Company may be required to write down its inventory through a lower of cost or net realizable value adjustment, the impact of which would be reflected in cost of sales on the Consolidated Statements of Operations. Any such adjustment would be based on management’s judgment regarding future demand and market conditions and analysis of historical experience.
Property, Plant and Equipment	Property, Plant and Equipment Property, plant and equipment are stated at cost, including internally manufactured equipment. The cost to complete equipment that is under construction is not considered to be material to the Company’s financial position. Provision for depreciation is recorded (for financial reporting purposes) using the straight-line method over the useful lives of the respective assets. Leasehold improvements are amortized on a straight-line basis over the shorter of economic life or terms of the respective leases. Costs of maintenance and repairs are charged to expense when incurred. Due to the specialized nature of the Company’s business, it is possible that the Company’s estimates of equipment useful life periods may change in the future.
Goodwill	Goodwill The Company has made acquisitions that included a significant amount of goodwill and other intangible assets. The Company applies the purchase method of accounting for acquisitions, which among other things, requires the recognition of goodwill (which represents the excess of the purchase price of the acquisition over the fair value of the net assets acquired and identified intangible assets). The Company tests its goodwill for impairment annually on a qualitative or quantitative basis (on the first day of the fourth quarter) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of an asset below its carrying value. Goodwill is tested for impairment at the reporting unit level. When performing the annual impairment test, the Company has the option of first performing a qualitative assessment, which requires management to make assumptions affecting a reporting unit, to determine the existence of events and circumstances that would lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If such a conclusion is reached, the Company is then required to perform a quantitative impairment assessment of goodwill. The Company has one reporting unit at September 30, 2023. Other intangible assets that meet certain criteria are amortized over their estimated useful lives. An impairment charge is recorded based on the excess of a reporting unit’s carrying amount over its fair value. An impairment charge would be recognized when the carrying amount exceeds the estimated fair value of a reporting unit. These impairment evaluations use many assumptions and estimates in determining an impairment loss, including certain assumptions and estimates related to future earnings. If the Company does not achieve its earnings objectives, the assumptions and estimates underlying these impairment evaluations could be adversely affected, which could result in an asset impairment charge that would negatively impact operating results. During the fourth quarter of 2022, the Company completed its annual impairment test as of October 1 and determined in its qualitative assessment it is more likely than not that the fair value of the reporting unit is greater than its carrying amount, resulting in no goodwill impairment. There can be no assurances that future sustained declines in macroeconomic or business conditions affecting our industry will not occur, which could result in goodwill impairment charges in future periods. There were no goodwill impairment losses recognized in 2022 or the nine months ended September 30, 2023.
Leases	Leases In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. The Company accounts for operating leases in accordance with ASU 2016-02. The Company’s accounting for finance leases remained substantially unchanged. See Note 5 for further details and current balances.
Cylinder Deposit Liability	Cylinder Deposit Liability The cylinder deposit liability, which is included in accrued expenses and other current liabilities on the Company’s Balance Sheet, represents the amount due to customers for the return of refillable cylinders. The Company’s Aspen Refrigerants division (“ARI”) charges its customers cylinder deposits upon the shipment of refrigerant gases that are contained in refillable cylinders. The amount charged to the customer by ARI approximates the cost of a new cylinder of the same size. Upon return of a cylinder, this liability is reduced. The cylinder deposit liability balance was $16.6 million and $13.6 million at September 30, 2023 and December 31, 2022, respectively.
Revenues and Cost of Sales	Revenues and Cost of Sales The Company’s products and services are primarily used in commercial air conditioning, industrial processing and refrigeration systems. Most of the Company’s revenues are realized from the sale of refrigerant and industrial gases and related products. The Company also generates revenue from refrigerant management services performed at a customer’s site and in-house. The Company conducts its business primarily within the US. The Company applies the FASB’s guidance on revenue recognition, which requires the Company to recognize revenue in an amount that reflects the consideration to which the Company expects to be entitled in exchange for goods or services transferred to its customers. In most instances, the Company’s contract with a customer is the customer’s purchase order and the sales price to the customer is fixed. For certain customers, the Company may also enter into a sales agreement outlining a framework of terms and conditions applicable to future purchase orders received from that customer. Because the Company’s contracts with customers are typically for a single customer purchase order, the duration of the contract is usually less than one year. The Company’s performance obligations related to product sales are satisfied at a point in time, which may occur upon shipment of the product or receipt by the customer, depending on the terms of the arrangement. The Company’s performance obligations related to reclamation and RefrigerantSide® services are generally satisfied at a point in time when the service is performed. Accordingly, revenues are recorded upon the shipment of the product, or in certain instances upon receipt by the customer, or the completion of the service. In July 2016 the Company was awarded, as prime contractor, a five-year contract, including a five-year renewal option, which has been exercised through July 2026, by the United States Defense Logistics Agency (“DLA”) for the management, supply, and sale of refrigerants, compressed gases, cylinders, and related services. Due to the contract containing multiple performance obligations, the Company assessed the arrangement in accordance with ASC 606-10-25-14. The Company determined that the sale of refrigerants and the management services provided under the contract each have stand-alone value. Accordingly, the performance obligation related to the sale of refrigerants is satisfied at a point in time, mainly when the customer receives and obtains control of the product. The performance obligation related to management service revenue is satisfied over time and revenue is recognized on a straight-line basis over the term of the arrangement as the management services are provided. Cost of sales is recorded based on the cost of products shipped or services performed and related direct operating costs of the Company’s facilities. In general, the Company performs shipping and handling services for its customers in connection with the delivery of refrigerant and other products. The Company elected to implement ASC 606-10-25-18B, whereby the Company accounts
Income Taxes	Income Taxes The Company is taxed at statutory corporate income tax rates after adjusting income reported for financial statement purposes for certain items. Current income tax expense reflects the tax results of revenues and expenses currently taxable or deductible. The Company utilizes the asset and liability method of accounting for deferred income taxes, which provides for the recognition of deferred tax assets or liabilities, based on enacted tax rates and laws, for the differences between the financial and income tax reporting bases of assets and liabilities. The tax benefit associated with the Company’s net operating loss carry forwards (“NOLs”) is recognized to the extent that the Company expects to realize future taxable income. During the year ended December 31, 2022, the Company concluded that its deferred tax assets were more likely than not to become realizable. The Company fully reversed its existing valuation allowance of $15.1 million, with $11.6 million reversed during the first and second quarters of 2022, and the remaining $3.5 million through the third and fourth quarters of 2022. The conclusion that a valuation allowance was no longer needed was based on the achievement of three years of cumulative pre-tax income, the utilization of the Company’s $29.3 million federal NOLs, which comprised a majority of the Company’s deferred tax assets, combined with estimates of future years’ pre-tax income that were sufficient to realize the remaining deferred tax assets. As of September 30, 2023, the Company had no federal NOLs, as the Company utilized all of its remaining federal NOLs during the year ended December 31, 2022. As of September 30, 2023, the Company had state tax NOLs of approximately $1.8 million, expiring in various years. We review the likelihood that we will realize the benefit of our deferred tax assets on a quarterly basis. The Company evaluates uncertain tax positions, if any, by determining if it is more likely than not to be sustained upon examination by the taxing authorities. As of September 30, 2023 and December 31, 2022, the Company believes it had no uncertain tax positions.
Income per Common and Equivalent Shares	Income per Common and Equivalent Shares If dilutive, common equivalent shares (common shares assuming exercise of options) utilizing the treasury stock method are considered in the presentation of diluted income per share. The reconciliation of shares used to determine net income per share is as follows (dollars in thousands, unaudited): Three Months Nine Months ended September 30, ended September 30, 2023 2022 2023 2022 Net income $ 13,582 $ 29,356 $ 48,302 $ 98,721 Weighted average number of shares – basic 45,404,963 45,063,810 45,348,072 44,935,739 Shares underlying options 1,940,417 2,117,614 1,971,392 2,117,271 Weighted average number of shares – diluted 47,345,380 47,181,424 47,319,464 47,053,010 During the three month periods ended September 30, 2023 and 2022, certain options aggregating 7,444 and 2,743 shares, respectively, have been excluded from the calculation of diluted shares, due to the fact that their effect would be anti-dilutive. During the nine month periods ended September 30, 2023 and 2022, certain options aggregating 7,444 and 2,980 shares, respectively, have been excluded from the calculation of diluted shares, due to the fact that their effect would be anti-dilutive.
Estimates and Risks	Estimates and Risks The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the use of estimates and assumptions that affect the amounts reported in these financial statements and footnotes. The Company considers these accounting estimates to be critical in the preparation of the accompanying consolidated financial statements. The Company uses information available at the time the estimates are made. However, these estimates could change materially if different information or assumptions were used. Additionally, these estimates may not ultimately reflect the actual amounts of the final transactions that occur. The Company utilizes both internal and external sources to evaluate potential current and future liabilities for various commitments and contingencies. In the event that the assumptions or conditions change in the future, the estimates could differ from the original estimates. Several of the Company’s accounting policies involve significant judgments, uncertainties, and estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. To the extent that actual results differ from management’s judgments and estimates, there could be a material adverse effect on the Company. On a continuous basis, the Company evaluates its estimates, including, but not limited to, those estimates related to its allowance for doubtful accounts, inventory reserves, goodwill and commitments and contingencies. With respect to trade accounts receivable, the Company estimates the necessary allowance for doubtful accounts based on both historical and anticipated trends of payment history and the ability of the customer to fulfill its obligations. For inventory, the Company evaluates both current and anticipated sales prices of its products to determine if a write down of inventory to net realizable value is necessary. The Company participates in an industry that is highly regulated, and changes in the regulations affecting its business could affect its operating results. Currently the Company purchases virgin hydrofluorocarbon (“HFC”) and hydrofluroolefin (“HFO”) refrigerants and reclaimable, primarily hydrochlorofluorocarbons (“HCFC”), HFC and chlorofluorocarbon (“CFC”), refrigerants from suppliers and its customers. To the extent that the Company is unable to source sufficient quantities of refrigerants or is unable to obtain refrigerants on commercially reasonable terms or experiences a decline in demand and/or price for refrigerants sold by the Company, the Company could realize reductions in revenue from refrigerant sales, which could have a material adverse effect on its operating results and its financial position. The process of sourcing refrigerants includes various procurement costs, such as freight, processing, insurance, and other costs, relating to the delivery of refrigerants. As a result of the recently noted global supply chain issues, the Company determined it could be exposed to incremental costs related to these refrigerant purchases. These costs represent the Company’s initial estimate that are possibly subject to finalization in future periods and are recorded in accrued expenses and other current liabilities on the consolidated balance sheet as of September 30, 2023. The Company is subject to various legal proceedings. The Company assesses the merit and potential liability associated with each of these proceedings. In addition, the Company estimates potential liability, if any, related to these matters. To the extent that these estimates are not accurate, or circumstances change in the future, the Company could realize liabilities, which could have a material adverse effect on its operating results and its financial position.
Impairment of Long-lived Assets	Impairment of Long-lived Assets The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less the cost to sell.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments, which revises guidance for the accounting for credit losses on financial instruments within its scope, and in November 2018, issued ASU No. 2018-19 and in April 2019, issued ASU No. 2019-04 and in May 2019, issued ASU No. 2019-05, and in November 2019, issued ASU No. 2019-11, which each amended the standard. The new standard introduces an approach, based on expected losses, to estimate credit losses on certain types of financial instruments and modifies the impairment model for available-for-sale debt securities. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities, net investments in leases and off-balance-sheet credit exposures. This ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, with early adoption permitted. Entities are required to apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. The Company adopted ASU No. 2016-13 on January 1, 2023. The adoption of ASU No. 2016-13 did not have a material impact on its results of operations or financial position. In August 2020, the FASB issued ASU 2020-06, “Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, which is intended to simplify the accounting for convertible instruments by removing certain separation models in Subtopic 470-20, Debt-Debt with Conversion and Other Options, for convertible instruments. The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU 2020-06 on January 1, 2023. The adoption of ASU 2020-06 did not have a material impact on its results of operations or financial position.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
Summary of Significant Accounting Policies (Tables)	Sep. 30, 2023
Summary of Significant Accounting Policies
Schedule of reconciliation of shares used to determine net income per share	Three Months Nine Months ended September 30, ended September 30, 2023 2022 2023 2022 Net income $ 13,582 $ 29,356 $ 48,302 $ 98,721 Weighted average number of shares – basic 45,404,963 45,063,810 45,348,072 44,935,739 Shares underlying options 1,940,417 2,117,614 1,971,392 2,117,271 Weighted average number of shares – diluted 47,345,380 47,181,424 47,319,464 47,053,010

Inventories (Tables)

Inventories (Tables)	9 Months Ended
Inventories (Tables)	Sep. 30, 2023
Inventories
Schedule of inventories	September 30, December 31, 2023 2022 (unaudited) (in thousands) Refrigerants and cylinders $ 144,123 $ 152,840 Less: net realizable value adjustments (4,892) (7,463) Total $ 139,231 $ 145,377

Property, plant and equipment (

Property, plant and equipment (Tables)	9 Months Ended
Property, plant and equipment (Tables)	Sep. 30, 2023
Property, plant and equipment
Schedule of elements of property, plant and equipment	September 30, December 31, Estimated 2023 2022 Lives (in thousands) (unaudited) Property, plant and equipment - Land $ 1,255 $ 1,255 - Land improvements 319 319 6-10 years - Buildings 1,446 1,446 25-39 years - Building improvements 3,467 3,396 25-39 years - Cylinders 13,300 13,315 15-30 years - Equipment 28,920 27,258 3-10 years - Equipment under capital lease 315 315 5-7 years - Vehicles 1,789 1,773 3-5 years - Lab and computer equipment, software 3,233 3,103 2-8 years - Furniture & fixtures 933 840 5-10 years - Leasehold improvements 865 852 3-5 years - Construction-in-progress 3,741 3,533 Subtotal 59,583 57,405 Less: Accumulated depreciation (39,013) (36,837) Total $ 20,570 $ 20,568

Leases (Tables)

Leases (Tables)	9 Months Ended
Leases (Tables)	Sep. 30, 2023
Leases
Schedule of maturity of lease payments	September 30, Maturity of Lease Payments 2023 (in thousands) (unaudited) 2023 (remaining) $ 1,291 -2024 2,372 -2025 2,173 -2026 1,283 -2027 799 -Thereafter 960 Total undiscounted operating lease payments 8,878 Less imputed interest (1,739) Present value of operating lease liabilities $ 7,139
Schedule of balance sheet classification of lease liabilities	September 30, 2023 (in thousands) (unaudited) Current lease liabilities (recorded in Accrued expenses and other current liabilities) $ 1,972 Long-term lease liabilities 5,167 Total operating lease liabilities $ 7,139
Schedule of other information of operating leases	September 30, 2023 Weighted-average remaining term for operating leases 3.07 years Weighted-average discount rate for operating leases 8.24 %

Goodwill and intangible assets

Goodwill and intangible assets (Tables)	9 Months Ended
Goodwill and intangible assets (Tables)	Sep. 30, 2023
Goodwill and intangible assets
Schedule of company's other intangible assets	September 30, 2023 December 31, 2022 (unaudited) Amortization Gross Gross Period Carrying Accumulated Carrying Accumulated (in thousands) (in years) Amount Amortization Net Amount Amortization Net Intangible assets with determinable lives Covenant not to compete 6 – 10 870 776 94 870 710 160 Customer relationships 3 – 12 31,560 16,486 15,074 31,560 14,491 17,069 Above market leases 13 567 266 301 567 232 335 Total identifiable intangible assets $ 32,997 $ 17,528 $ 15,469 $ 32,997 $ 15,433 $ 17,564

Share-based compensation (Table

Share-based compensation (Tables)	9 Months Ended
Share-based compensation (Tables)	Sep. 30, 2023
Share-based compensation
Schedule of the activity for stock options issued	Weighted Average Exercise Stock Option Plan Totals Shares Price Outstanding at December 31, 2021 2,604,023 $ 1.03 -Cancelled (11,781) $ 3.75 -Exercised (583,273) $ 1.15 -Granted (1) 381,181 $ 4.33 Outstanding at December 31, 2022 2,390,150 $ 1.51 -Cancelled (26,150) $ 9.62 -Exercised (275,405) $ 2.68 -Granted (2) 592,798 $ 10.02 Outstanding at September 30, 2023, unaudited 2,681,393 $ 3.26 (1) Options to purchase 381,181 shares were granted in 2022, of which options to purchase 40,588 shares vested immediately in 2022 and the remainder vested 50 % immediately and 50 % one year after the date of the grants. (2) Options to purchase 575,098 shares were granted in 2023, of which options to purchase 337,727 shares vested immediately in 2023 and the remainder vested 50 % immediately and 50% one year after the date of the grants. In addition, 17,700 stock appreciation rights were granted in January 2023 with a nine - month vesting period.
Schedule of weighted average contractual life in years and the weighted average exercise price	Weighted Average Weighted Remaining Average Number of Contractual Exercise Options Life Price Options outstanding and vested 2,444,022 4.64 years $ 2.60

Short-term and Long-term debt (

Short-term and Long-term debt (Tables)	9 Months Ended
Short-term and Long-term debt (Tables)	Sep. 30, 2023
Short-term and Long-term debt
Schedule of short-term and long-term debt	September 30, December 31, 2023 2022 (in thousands) (unaudited) Short-term & long-term debt Short-term debt: - Revolving credit line and other debt $ 5,000 $ — - Term loan facility – current — 4,250 Subtotal 5,000 4,250 Long-term debt: - Term loan facility- net of current portion of long-term debt — 27,563 - FILO term loan — 15,000 - Less: deferred financing costs on term loan — (3,578) Subtotal — 38,985 Total short-term & long-term debt $ 5,000 $ 43,235

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details) T in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($) shares	Sep. 30, 2022 USD ($) shares	Sep. 30, 2023 USD ($) segment item T shares	Sep. 30, 2022 USD ($) T shares	Dec. 31, 2022 USD ($)	Jun. 30, 2022 USD ($)	Mar. 31, 2022 USD ($)
Significant accounting policies
Number of reportable segments \| segment			1
Stepdown from baseline levels, final rule			10%
Cumulative reduction in baseline, subsequent allowance			40%
Allocation allowance received \| T			3	3
Allocation allowance received as a percentage of total HFC consumption			1%
Number of reporting unit \| item			1
Goodwill impairment loss			$ 0		$ 0
Cylinder deposit liability	$ 16,600,000		$ 16,600,000		13,600,000
Deferred tax assets, valuation allowance		$ 3,500,000		$ 3,500,000	3,500,000	$ 11,600,000	$ 15,100,000
Options excluded from the calculation of diluted shares \| shares	7,444	2,743	7,444	2,980
Federal
Significant accounting policies
Operating loss carryforwards	$ 0		$ 0
Current year utilization comprise of deferred tax					$ 29,300,000
State
Significant accounting policies
Operating loss carryforwards	1,800,000		$ 1,800,000
Customer Concentration Risk \| No Customer \| Revenue from Contract with Customer
Significant accounting policies
Concentration risk percentage			10%
Customer Concentration Risk \| One Customer \| Revenue from Contract with Customer
Significant accounting policies
Concentration risk percentage				10%
Customer Concentration Risk \| One Customer \| Accounts Receivable
Significant accounting policies
Accounts receivable	$ 19,700,000		$ 19,700,000

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Reconciliation of shares used to determine net income per share (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Summary of Significant Accounting Policies
Net income	$ 13,582	$ 29,356	$ 48,302	$ 98,721
Weighted average number of shares - basic	45,404,963	45,063,810	45,348,072	44,935,739
Shares underlying options	1,940,417	2,117,614	1,971,392	2,117,271
Weighted average number of shares outstanding - diluted	47,345,380	47,181,424	47,319,464	47,053,010

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Inventories
Refrigerants and cylinders	$ 144,123	$ 152,840
Less: net realizable value adjustments	(4,892)	(7,463)
Total	$ 139,231	$ 145,377

Property, plant and equipment -

Property, plant and equipment - Summary of elements of property, plant and equipment (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Property, plant and equipment
Subtotal	$ 59,583		$ 57,405
Less: Accumulated depreciation	(39,013)		(36,837)
Total	20,570		20,568
Depreciation expense	2,200	$ 2,500
Land
Property, plant and equipment
Subtotal	1,255		1,255
Land improvements
Property, plant and equipment
Subtotal	$ 319		319
Land improvements \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	6 years
Land improvements \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	10 years
Buildings
Property, plant and equipment
Subtotal	$ 1,446		1,446
Buildings \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	25 years
Buildings \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	39 years
Building improvements
Property, plant and equipment
Subtotal	$ 3,467		3,396
Building improvements \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	25 years
Building improvements \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	39 years
Cylinders
Property, plant and equipment
Subtotal	$ 13,300		13,315
Cylinders \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	15 years
Cylinders \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	30 years
Equipment
Property, plant and equipment
Subtotal	$ 28,920		27,258
Equipment \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	3 years
Equipment \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	10 years
Equipment under capital lease
Property, plant and equipment
Subtotal	$ 315		315
Equipment under capital lease \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	5 years
Equipment under capital lease \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	7 years
Vehicles
Property, plant and equipment
Subtotal	$ 1,789		1,773
Vehicles \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	3 years
Vehicles \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	5 years
Lab and computer equipment, software
Property, plant and equipment
Subtotal	$ 3,233		3,103
Lab and computer equipment, software \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	2 years
Lab and computer equipment, software \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	8 years
Furniture & fixtures
Property, plant and equipment
Subtotal	$ 933		840
Furniture & fixtures \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	5 years
Furniture & fixtures \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	10 years
Leasehold improvements
Property, plant and equipment
Subtotal	$ 865		852
Leasehold improvements \| Minimum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	3 years
Leasehold improvements \| Maximum
Property, plant and equipment
Property, plant and equipment, Estimated Lives	5 years
Construction-in-progress
Property, plant and equipment
Subtotal	$ 3,741		$ 3,533

Leases - Maturity of lease paym

Leases - Maturity of lease payments (Details) $ in Thousands	Sep. 30, 2023 USD ($)
Leases
2023 (remaining)	$ 1,291
2024	2,372
2025	2,173
2026	1,283
2027	799
Thereafter	960
Total undiscounted operating lease payments	8,878
Less imputed interest	(1,739)
Present value of operating lease liabilities	$ 7,139

Leases - Balance Sheet Classifi

Leases - Balance Sheet Classification and Other Information (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Balance Sheet Classification
Current lease liabilities (recorded in Accrued expenses and other current liabilities)	$ 1,972
Current lease liabilities (recorded in Accrued expenses and other current liabilities) [Extensible Enumeration]	Accrued expenses and other current liabilities
Long-term lease liabilities	$ 5,167	$ 5,763
Total operating lease liabilities	$ 7,139
Other Information
Weighted-average remaining term for operating leases	3 years 25 days
Weighted-average discount rate for operating leases	8.24%

Leases - Additional Information

Leases - Additional Information (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Leases
Maximum lease agreement terms	11 years
Operating lease liabilities	$ 2.1	$ 1.9
Selling, general and administrative expenses
Leases
Operating lease expense	$ 2.1	$ 1.9

Goodwill and intangible asset_2

Goodwill and intangible assets - Company's other intangible assets (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Goodwill and intangible assets
Gross Carrying Amount	$ 32,997	$ 32,997
Accumulated Amortization	17,528	15,433
Net	15,469	17,564
Covenant not to compete
Goodwill and intangible assets
Gross Carrying Amount	870	870
Accumulated Amortization	776	710
Net	$ 94	160
Covenant not to compete \| Minimum
Goodwill and intangible assets
Amortization Period (in years)	6 years
Covenant not to compete \| Maximum
Goodwill and intangible assets
Amortization Period (in years)	10 years
Customer relationships
Goodwill and intangible assets
Gross Carrying Amount	$ 31,560	31,560
Accumulated Amortization	16,486	14,491
Net	$ 15,074	17,069
Customer relationships \| Minimum
Goodwill and intangible assets
Amortization Period (in years)	3 years
Customer relationships \| Maximum
Goodwill and intangible assets
Amortization Period (in years)	12 years
Above market leases
Goodwill and intangible assets
Amortization Period (in years)	13 years
Gross Carrying Amount	$ 567	567
Accumulated Amortization	266	232
Net	$ 301	$ 335

Goodwill and intangible asset_3

Goodwill and intangible assets - Additional Information (Details) - USD ($) $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Goodwill and intangible assets
Goodwill impairment loss	$ 0		$ 0
Goodwill	47,803		$ 47,803
Amortization of intangible assets	$ 2,095	$ 2,095

Share-based compensation (Detai

Share-based compensation (Details) - USD ($) $ in Millions	1 Months Ended	9 Months Ended		12 Months Ended
Share-based compensation (Details) - USD ($) $ in Millions	Jan. 31, 2023	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Jun. 11, 2020	Jun. 07, 2018	Sep. 17, 2014
Share-based compensation
Common stock reserved for issuance		4,350,191
Stock option vesting period		1 year		1 year
Share-based compensation arrangement by share based payment award percentage of fair market person holding more then 10% voting stock		110%
Intrinsic value of options outstanding		$ 26.9		$ 20.6
Intrinsic value of options unvested		0.8		$ 1.1
Intrinsic value of options exercised		$ 2.3	$ 2.1
Stock Option Plan
Share-based compensation
Stock option vesting period		2 years
Stock option vesting, percentage		50%		50%
Option to purchase granted		575,098		381,181
Options vested		337,727		40,588
Minimum \| Stock Option Plan
Share-based compensation
Contractual term		3 years
Maximum \| Stock Option Plan
Share-based compensation
Contractual term		10 years
2014 Stock Incentive Plan
Share-based compensation
Common stock reserved for issuance							3,000,000
2018 Stock Incentive Plan
Share-based compensation
Common stock reserved for issuance						4,000,000
2020 Stock Incentive Plan
Share-based compensation
Common stock reserved for issuance					3,000,000
Stock Option Plan
Share-based compensation
Options granted		592,798		381,181
Share-based awards at the granted
Share-based compensation
Options granted		592,798	379,070
Stock Appreciation Rights (SARs)
Share-based compensation
Stock option vesting period	9 months
Option to purchase granted	17,700
Selling, general and administrative expenses
Share-based compensation
Share based compensation expense		$ 2.1	$ 0.8

Share-based compensation - Summ

Share-based compensation - Summary of the activity for stock options issued under the Company's Plans (Details) - Stock Option Plan - $ / shares	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Shares
Outstanding at beginning of period	2,390,150	2,604,023
-Cancelled	(26,150)	(11,781)
-Exercised	(275,405)	(583,273)
-Granted	592,798	381,181
Outstanding at end of period	2,681,393	2,390,150
Weighted Average Exercise Price
Outstanding at beginning of period	$ 1.51	$ 1.03
-Cancelled	9.62	3.75
-Exercised	2.68	1.15
-Granted	10.02	4.33
Outstanding at end of period	$ 3.26	$ 1.51

Share-based compensation - Weig

Share-based compensation - Weighted average contractual life in years and the weighted average exercise price (Details)	9 Months Ended
	Sep. 30, 2023 $ / shares shares
Number of Options
Options outstanding and vested \| shares	2,444,022
Weighted Average Remaining Contractual Life
Options outstanding and vested	4 years 7 months 20 days
Weighted Average Exercise Price
Options outstanding and vested \| $ / shares	$ 2.60

Short-term and Long-term debt_2

Short-term and Long-term debt (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Short-term debt:
- Revolving credit line and other debt	$ 5,000
- Term loan facility - current		$ 4,250
Subtotal	5,000	4,250
Long-term debt:
- Term loan facility- net of current portion of long-term debt		27,563
- FILO term loan		15,000
- Less: deferred financing costs on term loan		(3,578)
Subtotal		38,985
Total short-term & long-term debt	$ 5,000	$ 43,235

Short-term and Long-term debt -

Short-term and Long-term debt - Additional Information (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Mar. 02, 2022	Sep. 30, 2023	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022
Short-term and Long-term debt
Maximum borrowing capacity	$ 90,000
Repayment of debt				$ 47,161	$ 138,331
Amortization of deferred finance costs				669	$ 2,152
Term Loan
Short-term and Long-term debt
Credit facility, interest expense		$ 3,400
Repayment of debt		32,500
Amortization of deferred finance costs		3,100
Other expense and fees		$ 300		$ 300
Revolving credit facility Amendment
Short-term and Long-term debt
Debt instrument, basis spread on variable rate	1%
Additional interest percentage	0.50%
Revolving credit facility Amendment \| FILO Tranche
Short-term and Long-term debt
Debt instrument, basis spread on variable rate	1%
Additional interest percentage	0.50%
Revolving credit facility Amendment \| SOFR
Short-term and Long-term debt
Additional interest percentage	1%
Revolving credit facility Amendment \| SOFR \| FILO Tranche
Short-term and Long-term debt
Additional interest percentage	1%
Revolving credit facility Amendment \| SOFR \| SOFR FILO Tranche
Short-term and Long-term debt
Additional interest percentage	7.50%
Revolving credit facility Amendment \| Prime commercial lending rate of Wells Fargo \| FILO Tranche
Short-term and Long-term debt
Additional interest percentage	6.50%
Revolving Credit Facility
Short-term and Long-term debt
Deferred financing costs	$ 200
Term Loan Facility
Short-term and Long-term debt
Deferred financing costs	1,300
Debt instrument loan amount	85,000
Payment of term loan deferred financing costs	4,300
Principal balance of debt	63,900
Payment of debt, cash flow amount	16,000
Lender fees and expenses on debt	$ 3,300
Credit facility, interest expense			$ 4,600
Minimum \| Revolving credit facility Amendment \| SOFR
Short-term and Long-term debt
Additional interest percentage	2.36%
Minimum \| Revolving credit facility Amendment \| Prime commercial lending rate of Wells Fargo
Short-term and Long-term debt
Additional interest percentage	1.25%
Maximum \| Revolving credit facility Amendment \| SOFR
Short-term and Long-term debt
Additional interest percentage	2.86%
Maximum \| Revolving credit facility Amendment \| Prime commercial lending rate of Wells Fargo
Short-term and Long-term debt
Additional interest percentage	1.75%
Wells Fargo
Short-term and Long-term debt
Amount outstanding, letter of credit	$ 900
Deferred financing costs	$ 900
Line of credit facility term	5 years
Wells Fargo \| FILO Tranche
Short-term and Long-term debt
Amount borrowed	$ 15,000
Wells Fargo \| FCCR
Short-term and Long-term debt
Minimum aggregate undrawn loan availability	$ 11,250
Period for FCCR covenant	12 months
Wells Fargo \| Revolving credit facility Amendment
Short-term and Long-term debt
Maximum borrowing capacity	$ 75,000
Wells Fargo \| Swing line loan
Short-term and Long-term debt
Maximum borrowing capacity	9,000
Wells Fargo \| Letter of credit
Short-term and Long-term debt
Maximum borrowing capacity	$ 2,000
Wells Fargo \| Revolving Credit Facility \| FCCR
Short-term and Long-term debt
Period for FCCR covenant	2 months
Wells Fargo \| Minimum
Short-term and Long-term debt
Minimum liquidity requirement	$ 5,000
Minimum amount to be derived from availability	$ 3,000
Wells Fargo \| Minimum \| FCCR
Short-term and Long-term debt
Fixed charges coverage ratio	1
Wells Fargo \| Minimum \| Revolving credit facility Amendment
Short-term and Long-term debt
Additional interest percentage	0.35%
Wells Fargo \| Maximum \| Revolving credit facility Amendment
Short-term and Long-term debt
Additional interest percentage	0.75%
Wells Fargo \| Maximum \| Revolving Credit Facility
Short-term and Long-term debt
Amount borrowed	$ 75,000

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ 13,582	$ 29,356	$ 48,302	$ 98,721

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false