Past year: ▼ 31%(5.50c – 21.0c USD)
Each one in plain English, with the numbers worked through for a shareholder.
23 May 2016bankruptcy or receivership▼ BadMajor
The confirmed plan took effect on May 20, 2016, and HII's common stock, Series A and B preferred stock, options and warrants were cancelled with no consideration. The filing says the SEC will revoke registration of the common stock, ending HII's obligation to file further reports. This carries out the cancellation set out in the April confirmation.
27 Apr 2016bankruptcy or receivership▼ BadMajor
On April 15, 2016 the bankruptcy court confirmed HII's Third Amended Joint Plan of Reorganization (corrected April 26); the effective date was not yet set. All existing common stock (63,132,329 shares), Series A preferred (4,000 shares), Series B preferred (2,950 shares), options and warrants will be cancelled on the effective date with no distribution to shareholders. The DIP lenders get 950,000 new convertible preferred shares (to become 95% of the reorganized equity) plus a share of a litigation trust, and unsecured creditors get 5% of the new common stock plus trust interests. This resolves the open question of how common shareholders would be treated. HII also agreed to an SEC settlement under which its stock registration will be revoked, and Loretta Cross became the sole director and officer.
12 Jan 2016asset acquisition disposition● NeutralMajor
On January 4, 2016 HII's Frac Water Management business sold some non-core assets, including an exclusive distribution agreement for HydroFLOW water treatment equipment, to Heat Waves Water Management, LLC for $1,225,000 cash plus assumed liabilities. The bankruptcy court approved the sale on December 17, 2015, and under that order the proceeds go to Hilco Industrial ($211,500) and the DIP lenders ($783,500), with $50,000, $150,000 (BLC Equipment Leasing claim) and $30,000 (transfer tax) held back. HII and Apache also leased HydroFLOW units back to the buyer for 24 months. This is the first asset sale in the Chapter 11 case; the filing does not say what shareholders receive.
8 Dec 2015debt financing▼ BadMajor
On October 14, 2015 the bankruptcy court entered a final order approving the roughly $12 million DIP facility with Heartland and McLarty Capital Partners: up to $500,000 of new money and an $11.5 million roll-up that satisfies the prepetition secured debt (owed at filing: $10,292,897.22 on the term loan and $890,680.71 on the receivables agreement). It bears 13.75% interest and matures at the earliest of six months after the filing, a confirmed plan, a sale of substantially all assets, or a default termination. The DIP lenders get priority over other claims. The filing also notes the October monthly operating report was filed with the court on November 20, 2015. This resolves the pending DIP request, but the filing does not say what happens to shareholders.
21 Sept 2015bankruptcy or receivership▼ BadMajor
On September 18, 2015 HII and its four subsidiaries (Apache Energy Services, Aqua Handling of Texas, Hamilton Investment Group and Sage Power Solutions) filed for Chapter 11 reorganization in the Southern District of Texas, Victoria Division (Case No. 15-60070). They asked the court to approve a DIP loan of up to $12 million from Heartland and McLarty Capital Partners, made up of up to $500,000 of new money and an $11.5 million roll-up of the existing Heartland debt. The filing also says bankruptcy lets Series B holders redeem at the greater of 112% of the amount or a share-price-based formula. This is the outcome of the default and forbearance sequence since July. The filing does not say what happens to common shares.
27 Aug 2015debt financing▼ BadMajor
On July 21, 2015 Apache Energy Services signed a factoring facility with Bay View Funding allowing advances of up to $1 million against receivables, with HII guaranteeing it. On August 21, 2015 HII also signed a Fifth Modification with Heartland that raised Term Loan 2 by $345,760.50 to $579,643.50, extended the pause on enforcement only to August 25, 2015, and required HII to repay $315,392.50 when the Bay View facility closed. HII again acknowledged existing defaults. This continues the short-dated forbearance with Heartland, and the Bay View facility is a replacement source of receivables funding after Heartland said it would stop advancing under its own facility.
12 Aug 2015debt financing▼ BadMajor
On August 7, 2015 HII and Heartland signed a Fourth Modification and Forbearance Agreement. HII confirmed about $9.2 million of principal and $96,737 of interest on the term loan and acknowledged existing defaults. Heartland and the lenders agreed not to enforce their rights until August 15, 2015, and a new $233,833 Term Loan 2 was funded by the lenders and Magna Equities II, with the second tranche of $68,725 at the lenders' sole discretion. HII also gave up defenses and released the lenders from claims. The filing is signed by a Chief Restructuring Officer, Loretta R. Cross, rather than the CEO (the first such signature in this record).
15 July 2015debt financing▼ BadMajor
On July 9, 2015 Heartland's lawyers sent HII and its subsidiaries a Notice of Default that did not say what the default was. Heartland took $675,000 from the reserve account and applied it to the term loan, and said it would stop advancing funds under the receivables facility. About $9.2 million was outstanding on the term loan and about $2.26 million on the receivables facility. Heartland did not demand immediate repayment. The filing says the default could raise the interest rate to as much as 18.75%, let Nations Fund I demand about $1.4 million under an equipment lease, and let Series B holders convert at 85% of the recent average share price, with the dividend rising from 12% to 15%. This follows the May covenant waiver and the Series B raise, whose proceeds partly went to the Heartland restricted account.
29 May 2015capital raising announcement● Neutral
This is a second correction to the May 20 filing. It clarifies that the Heartland term loan principal payments after the Third Amendment are $110,000 per month, not the $110,000 per week described in the earlier filings. The Series B raise (3,050 preferred shares, 3,812,500 warrants, $3,050,000, 15 investors) and the covenant waiver terms are repeated unchanged.
28 May 2015capital raising announcement● Neutral
This amendment updates the Series B raise: through May 27, 2015, HII sold a total of 3,050 preferred shares and warrants for 3,812,500 common shares to 15 investors for $3,050,000, matching the amount first announced on May 12. Roth Capital Partners is to be paid a $213,500 cash fee. About $1,977,425 goes to accounts payable and $757,575 to a Heartland restricted account for the term loan. The Heartland waiver terms are repeated unchanged.
20 May 2015capital raising announcement▼ BadMajor
On May 20, 2015 HII sold the first 2,735 Series B preferred shares and warrants for 3,418,750 common shares to 14 investors for $2,735,000. The same day Heartland Bank waived covenant defaults under the August 2014 credit facility for periods ended December 31, 2014 and March 31, 2015, and waived default interest through March 31, 2015. In return, the term loan interest rate rose to 13.75%, principal payments became $110,000 a week, and covenants were reset. About $1.97 million of the raise goes to accounts payable and $757,575 to a restricted account for the Heartland term loan. The filing shows the company had breached its loan covenants.
12 May 2015capital raising announcement● NeutralMajor
On May 12, 2015 HII agreed to sell 3,050 shares of Series B Convertible Preferred Stock to accredited investors for expected gross proceeds of $3,050,000. The preferred pays a 12% cumulative dividend, converts at $0.40 per share and comes with five-year warrants for 3,812,500 common shares at $0.50. This adds new preferred stock ranking ahead of common shareholders for dividends, and potential dilution if converted or exercised.
13 Nov 2014asset acquisition disposition● Neutral
This second amendment corrects the Hamilton Investment Group financial statements and pro forma figures filed on October 8, 2014. The June 30, 2014 Hamilton statements were restated, and the excess working capital owed to Hamilton's former stockholders is now stated as $2,521,628 instead of $3,314,260. The pro forma figures now also recognise a reduction of a valuation allowance against HII's deferred tax asset of $5,639,233. The deal terms (a $9,000,000 cash price, 3,523,554 shares and the Heartland facility) are unchanged, except the working capital retained from the facility is now stated as about $1.585 million instead of $1.625 million.
8 Oct 2014asset acquisition disposition● NeutralMajor
This amended report adds the financial statements and pro forma figures for the August 12, 2014 purchase of Hamilton Investment Group, which was bought for $9,000,000 cash and 3,523,554 HII shares, plus a working-capital adjustment. It also restates the terms of the Heartland Bank $12 million three-year term loan and up to $6 million receivables facility used to fund it, with a 4-year warrant for 2.5 million shares at $1.00 given to the lenders. Also disclosed are an employment agreement with William Hamilton ($125,000 a year) and a $1,516,000 equipment purchase from his company, S&M Assets, leased meanwhile at $10,000 a month. The Hamilton deal adds debt and share dilution on top of the Apache business bought in 2012.
1 Oct 2014material agreement● Neutral
Effective September 15, 2014, HII and its subsidiaries amended the August 2014 Heartland Bank credit documents: the receivables-purchase facility limit rose from $6,000,000 to $6,600,000, the borrower address changed, and the deadline for landlord consents and waivers was extended to 60 days. The company also signed a five-year office lease at 8588 Katy Freeway, Houston (to September 2019) at $5,535.35 a month plus estimated common-area fees of $2,965.10.
15 Aug 2014asset acquisition disposition● NeutralMajor
On August 12, 2014 HII bought Hamilton Investment Group for $9,000,000 cash and 3,523,554 common shares (valued at $2,300,000), subject to a working capital adjustment. It financed this with a new Heartland Bank senior secured facility: a 3-year $12 million term loan at WSJ prime plus 5.50% to 8.25% (maturing August 12, 2017), and an account purchase agreement for up to $6 million of receivables, which replaced the earlier receivables facility. Heartland also received a 4-year warrant for 2.5 million shares at $1.00 and a $450,000 fee, and the loans carry financial covenants and are secured by all borrower assets and the subsidiary equity. Hamilton's president William Hamilton got a 2-year employment agreement at $125,000, and HII agreed to buy equipment from his company S&M Assets for $1,516,000 on or before August 12, 2015, with a $10,000 monthly lease in the meantime. This is the largest deal in the company's history and a much bigger debt load, replacing the Rosenthal facility.
3 July 2014capital raising announcement● NeutralMajor
Between June 21 and July 2, 2014 HII sold 4,000 units at $1,000 each to 22 accredited investors for $4,000,000 gross. Each unit has one Series A convertible preferred share (convertible at $0.70 per common share) and warrants for 550 common shares at $1.00 for 3 years. Of the proceeds, $124,250 went to placement agent fees and about $500,000 repaid 10% promissory notes, with the rest for working capital and growth opportunities. The authorized Series A shares were raised from 3,000 to 4,000, and the issue adds dilution for existing common holders.
8 Apr 2014material agreement● Neutral
On April 7, 2014 the Rosenthal & Rosenthal receivables facility was amended again, raising the maximum from $4 million to $5 million. The company also announced preliminary unaudited results for the quarter ended March 31, 2014 via a press release; the filing text does not give the figures, and says no significant changes are expected.
30 Jan 2014material agreement● Neutral
On January 27, 2014 the Rosenthal & Rosenthal receivables facility, borrowed by Aqua, Apache and KMHVC, was amended to raise the maximum from $3 million to $4 million. This continues the stepwise expansion of that facility begun in June 2013.
21 Jan 2014asset acquisition disposition● Neutral
This amendment adds the audited financial statements of Aqua Handling of Texas (inception through September 30, 2013) and pro forma combined financials, which the November 2013 report on the Aqua purchase had promised. The deal terms are unchanged from that report. The financial figures are in exhibits not reproduced here, so nothing new on the numbers can be stated.
26 Nov 2013material agreement● Neutral
On November 20, 2013 newly acquired Aqua Handling of Texas became an additional borrower under the June 2013 Rosenthal & Rosenthal receivables facility, pledging its assets, with a new HII guaranty. The maximum available rose from $2 million to $3 million. This continues the Rosenthal facility, now extended to cover Aqua.
13 Nov 2013asset acquisition disposition● NeutralMajor
On November 12, 2013 HII bought Aqua Handling of Texas, LLC for $300,000 cash, $500,000 of 5% subordinated secured notes due November 1, 2016 and 1,443,696 common shares. To fund it, HII issued $750,000 of 10% convertible notes (convertible at $0.50 a share, two-year term) to six investors, of which $600,000 was new cash and $150,000 replaced an earlier note. Aqua's co-owner Chris George got a three-year employment agreement and an option for 250,000 shares at $0.38. This is a second acquisition after Apache, adding debt and some dilution; the acquired company's financial statements were promised by amendment.
1 July 2013material agreement● NeutralMajor
On June 26, 2013, subsidiaries KMHVC, Inc. and Apache Energy Services entered a $2 million revolving receivables financing facility with Rosenthal & Rosenthal. Borrowing is capped at the lesser of $2 million or 85% of eligible receivables, at prime plus 4.00%, secured by the borrowers' assets and guaranteed by HII with its own assets. The initial term is two years, with a $30,000 closing fee, $20,000 annual fee and monthly charges. This is new bank-style debt backing the Apache business.
6 Dec 2012asset acquisition disposition● Neutral
This amendment adds the audited financial statements of Apache Energy Services LLC and pro forma combined financials, which the original October 2012 report on the Apache purchase had left out. It also restates the deal terms: closing on September 27, 2012 for $290,000 cash ($250,000 at closing, $40,000 in six monthly installments), $1,300,000 of 5% notes due November 1, 2015 and 6,500,000 shares vesting 500,000 per quarter. The $300,000 of 10% notes with Class A and B warrants, and Brent Mulliniks' board seat and the $180,000 employment agreements for him and Billy Cox, are also repeated. The financial figures sit in exhibits not reproduced here. The note maturity is given as September 23, 2013 here, versus September 13 in the earlier summary.
2 Oct 2012asset acquisition disposition● NeutralMajor
On September 26, 2012 HII Technologies bought all of Apache Energy Services LLC for $290,000 in cash, $1,300,000 of 5% subordinated secured notes (maturing November 1, 2015) and 6,500,000 restricted shares vesting 500,000 per quarter from December 31, 2012. Apache's founders Brent Mulliniks and Billy Cox got three-year employment agreements at $180,000 a year plus quarterly bonuses, and Mulliniks joined the board. The company also sold $300,000 of 10% secured notes due September 13, 2013, with Class A warrants for 1,800,000 shares and Class B warrants for up to 900,000 shares, both at $0.10. This is a new business after the earlier asset sales, and it adds debt and share dilution.
8 Dec 2010listing compliance notice▼ BadMajor
HII Technologies, Inc. deregistered its securities, ending its obligation to file reports with the SEC.
8 July 2010capital raising announcement● NeutralMajor
On June 30, 2010 Eads Investments I and D. Bradley McWilliams bought the company's Stillwater National Bank debt, and Stillwater released the company and Hemiwedge Valve Corporation. The debt was replaced by a 10% note for $706,125 due June 30, 2011, secured by all assets and the subsidiary's stock, with forbearance from accelerating the loans. The new lenders also got 5-year warrants for 2,875,000 shares at $0.10, cut to 575,000 if the note is sold or repaid by August 15, 2010; interest can be paid in stock at 5,000 shares per day. This ends the long Stillwater lending relationship.
10 July 2009listing compliance notice▼ BadMajor
The company, now named Hemiwedge Industries, was told on June 19, 2009 that its Q1 2009 quarterly report was incomplete, so it is not current in its filings. Unless the filing was received by July 20, 2009, its stock would be removed from the OTC Bulletin Board (effective July 22) and trade on the pink sheets. The company said it did not intend to appeal or expect to fix the filing in time, but plans to reapply when current. It also said it is still evaluating strategic options, including a merger, sale of all or part of the company, restructuring or recapitalization, with no plan adopted.
2 Dec 2008financial restatement▼ BadMajor
The company said its 2007 annual report (10-KSB/A) should no longer be relied on, because a $2 million debt forgiveness from Stillwater was booked as 2006 income and should instead be recorded as additional paid-in capital. The 2006 net loss increases by $2 million; total equity is unchanged by the move. Revised statements will be filed in Amendment No. 2, and the auditors agree with the change. This revisits the 2006 Stillwater forgiveness noted in the company's history.
21 Oct 2008capital raising announcement● NeutralMajor
On October 15, 2008 the company and Hemiwedge Valve Corporation transferred assets and granted licence rights for the Hemiwedge valve technology to Tejas Research & Engineering for $3.5 million in cash plus a 5-year warrant for 2,443,269 shares at $0.25 (about 9.99% of shares outstanding). The licence covers sub-sea, offshore, drilling and workover, surface safety and all downhole fields, plus two pending patent applications and trademark use in those fields; Tejas transferred the warrant to Intervale Capital. This appears to be the HemiWedge licensing deal flagged earlier as pending, though the filing does not link them, and it covers the downhole and sub-sea applications.
What it means for a shareholder
2.4m new shares at $0.250 to raise about $610,817. Shares on issue before the raise aren't in the record, so the dilution can't be worked out.
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