H20 Industries took over a customer base and a small quantity of assets from a predecessor company. By moving to a new location with more space, and by designing an efficient productive capability, H20 Industries will be ready to aggressively penetrate the growing market for portable DI exchange by October 1999.
H20 Industries was established in October 1998 through the purchase of the assets of Commercial Waters Systems, Inc. (CWSI). CWSI was an under-capitalized, cash flow-starved DI exchange tank service provider. Three hundred sixty of the shares of H20 Industries are owned by David R. Smith, vice president sales and applications of PROSYS, a large manufacturer and system designer of water treatment equipment. Five hundred sixty of the shares are owned by John Jones who is regional sales manager for DUFF. The remaining 200 shares are currently held by the daughter of the seller, but are expected to soon be transferred to the new owners.
Additional investors have expressed a willingness to invest. This would help bring in needed administrative expertise, while also increasing the equity base.
Assets of a former operating company were bought out and customers of the former company continue to be serviced by the purchasing company, H20 Industries, partly from continuing operations and partly from farming regeneration work out. However, this plan is being written as a start-up primarily because there are no reliable financial figures for prior years for comparison purposes, and partly because of the move to new facilities and the sizable investment in new plant and equipment involved. Due to certain misrepresentations by the seller, the agreed sales price is under protest. It is expected that the matter will be satisfactorily resolved by payment of a much reduced amount.
The chart and table below summarize the start-up requirements for H20 Industries.
The facilities are located in a rented building on an industrial estate in Newark, California.
A description of the technology involved in the production can be found in section 3.5 (Technology). The following is a description of the production layout.