NEVADA
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94-3439569
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(State or other jurisdiction of
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(I.R.S. Employer Identification No.)
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incorporation or organization)
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1331 GEMINI STREET, SUITE 250
HOUSTON, TEXAS
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77058
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
ý
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Page
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PART I
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Item 1.
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Financial Statements
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Consolidated Balance Sheets (unaudited)
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Consolidated Statements of Operations (unaudited)
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Consolidated Statements of Cash Flows (unaudited)
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Notes to Consolidated Financial Statements (unaudited)
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Item 2
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Management’s Discussion And Analysis Of Financial Condition And Results Of Operations
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Item 3.
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Quantitative And Qualitative Disclosures About Market Risk
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Item 4.
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Controls and Procedures
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PART II
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Item 1.
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Legal Proceedings
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Item 1A.
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Risk Factors
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Item 2.
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Unregistered Sales Of Equity Securities And Use Of Proceeds
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Item 3.
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Defaults Upon Senior Securities
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Item 4.
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Mine Safety Disclosures
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Item 5.
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Other Information
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Item 6.
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Exhibits
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VERTEX ENERGY, INC.
|
||||||||
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
||||||||
|
|
September 30,
2014 |
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December 31,
2013 |
||||
ASSETS
|
|
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|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,229,746
|
|
|
$
|
2,678,628
|
|
Accounts receivable, net
|
|
21,675,824
|
|
|
11,714,813
|
|
||
Note receivable-related party
|
|
11,458,000
|
|
|
—
|
|
||
Inventory
|
|
19,001,712
|
|
|
8,540,459
|
|
||
Prepaid expenses
|
|
2,162,046
|
|
|
1,161,721
|
|
||
Total current assets
|
|
55,527,328
|
|
|
24,095,621
|
|
||
|
|
|
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|
||||
Noncurrent assets
|
|
|
|
|
|
|
||
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|
||||
Fixed assets, at cost
|
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49,318,232
|
|
|
16,109,179
|
|
||
Less accumulated depreciation
|
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(1,647,153
|
)
|
|
(1,018,003
|
)
|
||
Net fixed assets
|
|
47,671,079
|
|
|
15,091,176
|
|
||
Intangible assets, net
|
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16,327,341
|
|
|
15,172,816
|
|
||
Goodwill
|
|
4,922,353
|
|
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4,502,743
|
|
||
Deferred federal income tax
|
|
5,684,000
|
|
|
5,684,000
|
|
||
Other assets
|
|
2,797,842
|
|
|
—
|
|
||
Total noncurrent assets
|
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77,402,615
|
|
|
40,450,735
|
|
||
TOTAL ASSETS
|
|
$
|
132,929,943
|
|
|
$
|
64,546,356
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|
|
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|
||||
LIABILITIES AND EQUITY
|
|
|
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|
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|
||
Current liabilities
|
|
|
|
|
|
|
||
Accounts payable and accrued expenses
|
|
$
|
23,059,176
|
|
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$
|
14,096,185
|
|
Capital leases
|
|
605,442
|
|
|
—
|
|
||
Current portion of long-term debt
|
|
40,781,399
|
|
|
1,956,847
|
|
||
Total current liabilities
|
|
64,446,017
|
|
|
16,053,032
|
|
||
Long-term liabilities
|
|
|
|
|
|
|
||
Long-term debt
|
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2,040,598
|
|
|
6,558,851
|
|
||
Contingent consideration
|
|
3,371,836
|
|
|
3,220,250
|
|
||
Deferred federal income tax
|
|
378,000
|
|
|
378,000
|
|
||
Total liabilities
|
|
70,236,451
|
|
|
26,210,133
|
|
||
Commitments and contingencies
|
|
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||||
EQUITY
|
|
|
|
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|
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Preferred stock, $0.001 par value per share:
|
|
|
|
|
|
|
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50,000,000 shares authorized
|
|
|
|
|
|
|
||
Series A Convertible Preferred stock, $0.001 par value,
|
|
|
|
|
||||
5,000,000 authorized and 630,419 and 1,319,002 issued
|
|
|
|
|
||||
and outstanding at September 30, 2014 and December 31,
|
|
|
|
|
||||
2013, respectively
|
|
630
|
|
|
1,319
|
|
||
Common stock, $0.001 par value per share;
|
|
|
|
|
|
|
||
750,000,000 shares authorized; 25,414,156 and 21,205,609
|
|
|
|
|
||||
issued and outstanding at September 30, 2014 and
|
|
|
|
|
||||
December 31, 2013, respectively
|
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25,414
|
|
|
21,206
|
|
||
Additional paid-in capital
|
|
39,191,567
|
|
|
19,579,732
|
|
||
Retained earnings
|
|
23,475,881
|
|
|
17,542,004
|
|
||
Total Vertex Energy, Inc. stockholders' equity
|
|
62,693,492
|
|
|
37,144,261
|
|
||
Non-controlling interest
|
|
$
|
—
|
|
|
$
|
1,191,962
|
|
Total Equity
|
|
$
|
62,693,492
|
|
|
$
|
38,336,223
|
|
TOTAL LIABILITIES AND EQUITY
|
|
$
|
132,929,943
|
|
|
$
|
64,546,356
|
|
VERTEX ENERGY, INC.
|
||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||||
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
||||||||||||||||
(UNAUDITED)
|
||||||||||||||||
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
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2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Revenues
|
|
$
|
76,903,516
|
|
|
$
|
46,830,647
|
|
|
$
|
196,332,796
|
|
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$
|
115,196,850
|
|
Cost of revenues
|
|
72,846,322
|
|
|
41,945,879
|
|
|
178,252,434
|
|
|
104,287,660
|
|
||||
Gross profit
|
|
4,057,194
|
|
|
4,884,768
|
|
|
18,080,362
|
|
|
10,909,190
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Reduction of contingent liability
|
|
(1,876,752
|
)
|
|
—
|
|
|
(1,876,752
|
)
|
|
(1,850,000
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative expenses
(exclusive of acquisition related expenses)
|
|
6,801,396
|
|
|
2,495,748
|
|
|
16,464,402
|
|
|
7,129,673
|
|
||||
Acquisition related expenses
|
|
259,235
|
|
|
—
|
|
|
2,819,065
|
|
|
—
|
|
||||
Total operating expenses
|
|
7,060,631
|
|
|
2,495,748
|
|
|
19,283,467
|
|
|
7,129,673
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from operations
|
|
(1,126,685
|
)
|
|
2,389,020
|
|
|
673,647
|
|
|
5,629,517
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other income
|
|
109,980
|
|
|
—
|
|
|
110,357
|
|
|
—
|
|
||||
Bargain purchase gain related to Omega acquisition
|
|
92,635
|
|
|
—
|
|
|
6,573,686
|
|
|
—
|
|
||||
Other expense
|
|
—
|
|
|
(3,949
|
)
|
|
(10,866
|
)
|
|
(31,690
|
)
|
||||
Interest expense
|
|
(947,325
|
)
|
|
(95,488
|
)
|
|
(1,680,371
|
)
|
|
(314,627
|
)
|
||||
Total other income (expense)
|
|
(744,710
|
)
|
|
(99,437
|
)
|
|
4,992,806
|
|
|
(346,317
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income tax
|
|
(1,871,395
|
)
|
|
2,289,583
|
|
|
5,666,453
|
|
|
5,283,200
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income tax benefit (expense)
|
|
(57,975
|
)
|
|
40,211
|
|
|
(57,975
|
)
|
|
21,460
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
|
$
|
(1,929,370
|
)
|
|
$
|
2,329,794
|
|
|
$
|
5,608,478
|
|
|
$
|
5,304,660
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss attributable to non-controlling interest
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
325,399
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to Vertex Energy, Inc.
|
|
$
|
(1,929,370
|
)
|
|
$
|
2,329,794
|
|
|
$
|
5,933,877
|
|
|
$
|
5,304,660
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
(0.08
|
)
|
|
$
|
0.13
|
|
|
$
|
0.26
|
|
|
$
|
0.30
|
|
Diluted
|
|
$
|
(0.08
|
)
|
|
$
|
0.12
|
|
|
$
|
0.24
|
|
|
$
|
0.27
|
|
|
|
|
|
|
|
|
|
|
||||||||
Shares used in computing earnings per share
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
25,151,660
|
|
|
17,715,786
|
|
|
23,077,914
|
|
|
17,402,501
|
|
||||
Diluted
|
|
25,151,660
|
|
|
19,997,257
|
|
|
24,825,326
|
|
|
19,766,263
|
|
VERTEX ENERGY, INC.
|
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
NINE MONTHS ENDED SEPTEMBER 30, 2014 AND 2013
|
||||||||
(UNAUDITED)
|
||||||||
|
|
Nine Months Ended
|
||||||
|
|
September 30,
2014 |
|
September 30,
2013 |
||||
Cash flows from operating activities
|
|
|
|
|
||||
Net income
|
|
$
|
5,608,478
|
|
|
$
|
5,304,660
|
|
Adjustments to reconcile net income to cash
provided by operating activities
|
|
|
|
|
|
|
||
Stock based compensation expense
|
|
173,979
|
|
|
123,571
|
|
||
Depreciation and amortization
|
|
2,981,393
|
|
|
1,615,657
|
|
||
Gain on acquisition
|
|
(6,573,686
|
)
|
|
—
|
|
||
Deferred federal income tax
|
|
—
|
|
|
(144,000
|
)
|
||
Reduction of contingent liability
|
|
(1,876,752
|
)
|
|
(1,850,000
|
)
|
||
Changes in operating assets and liabilities
|
|
|
|
|
||||
Accounts receivable
|
|
(9,731,011
|
)
|
|
(794,821
|
)
|
||
Allowance for doubtful accounts
|
|
(230,000
|
)
|
|
—
|
|
||
Notes receivable-related party
|
|
(3,150,000
|
)
|
|
—
|
|
||
Inventory
|
|
(6,269,253
|
)
|
|
(2,338,000
|
)
|
||
Prepaid expenses
|
|
(1,348,935
|
)
|
|
(78,925
|
)
|
||
Accounts payable
|
|
8,962,991
|
|
|
3,516,056
|
|
||
Other assets
|
|
(81,450
|
)
|
|
—
|
|
||
Net cash provided by (used in) operating activities
|
|
(11,534,246
|
)
|
|
5,354,198
|
|
||
|
|
|
|
|
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
|
||
Acquisition of Omega
|
|
(30,164,464
|
)
|
|
(67,972
|
)
|
||
Refund of asset acquisition
|
|
—
|
|
|
675,558
|
|
||
Purchase of fixed assets
|
|
(4,227,056
|
)
|
|
(1,671,295
|
)
|
||
Net cash used in investing activities
|
|
(34,391,520
|
)
|
|
(1,063,709
|
)
|
||
|
|
|
|
|
|
|
||
Cash flows from financing activities
|
|
|
|
|
|
|
||
Line of credit payments, net
|
|
—
|
|
|
(3,250,000
|
)
|
||
Proceeds related to secondary stock offering
|
|
15,803,000
|
|
|
—
|
|
||
Payments on contingent consideration
|
|
(136,662
|
)
|
|
—
|
|
||
Proceeds from note payable
|
|
41,372,315
|
|
|
—
|
|
||
Payments on note payable
|
|
(10,469,474
|
)
|
|
(1,372,453
|
)
|
||
Debt issue cost
|
|
(2,452,157
|
)
|
|
—
|
|
||
Proceeds from exercise of common stock options and warrants
|
|
359,862
|
|
|
55,250
|
|
||
Net cash provided by (used in) financing activities
|
|
44,476,884
|
|
|
(4,567,203
|
)
|
||
|
|
|
|
|
|
|
||
Net change in cash and cash equivalents
|
|
(1,448,882
|
)
|
|
(276,714
|
)
|
||
|
|
|
|
|
|
|
||
Cash and cash equivalents at beginning of the period
|
|
2,678,628
|
|
|
807,940
|
|
||
|
|
|
|
|
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
1,229,746
|
|
|
$
|
531,226
|
|
|
|
|
|
|
|
|
||
SUPPLEMENTAL INFORMATION
|
|
|
|
|
|
|
||
Cash paid for interest
|
|
$
|
1,600,117
|
|
|
$
|
323,956
|
|
Cash paid for income taxes
|
|
$
|
80,158
|
|
|
$
|
122,001
|
|
|
|
|
|
|
|
|
||
NON-CASH INVESTING AND FINANCING TRANSACTIONS
|
|
|
|
|
|
|
||
Conversion of Series A Preferred Stock into common stock
|
|
$
|
689
|
|
|
$
|
189
|
|
Note payable for acquisition of E-Source interest
|
|
$
|
854,050
|
|
|
$
|
—
|
|
Additional paid in capital for acquisition of E-Source interest
|
|
$
|
1,790,745
|
|
|
$
|
—
|
|
|
|
2014
|
|
2013
|
||||
|
|
% of
Revenues
|
|
% of
Receivables
|
|
% of
Revenues
|
|
% of
Receivables
|
Customer 1
|
|
28%
|
|
—%
|
|
1%
|
|
—%
|
Customer 2
|
|
13%
|
|
8%
|
|
46%
|
|
27%
|
Customer 3
|
|
11%
|
|
—%
|
|
10%
|
|
—%
|
Customer 4
|
|
9%
|
|
47%
|
|
—%
|
|
—%
|
Customer 5
|
|
7%
|
|
12%
|
|
8%
|
|
16%
|
Customer 6
|
|
2%
|
|
11%
|
|
—%
|
|
—%
|
Customer 7
|
|
—%
|
|
—%
|
|
10%
|
|
16%
|
Customer 8
|
|
—%
|
|
—%
|
|
2%
|
|
24%
|
|
|
% of Revenue by Segment 2014
|
|
% Revenue by Segment 2013
|
||||||||
|
|
Black Oil
|
|
Refining
|
|
Recovery
|
|
Black Oil
|
|
Refining
|
|
Recovery
|
Customer 1
|
|
100%
|
|
—%
|
|
—%
|
|
100%
|
|
—%
|
|
—%
|
Customer 2
|
|
8%
|
|
92%
|
|
—%
|
|
17%
|
|
83%
|
|
—%
|
Customer 3
|
|
—%
|
|
100%
|
|
—%
|
|
—%
|
|
100%
|
|
—%
|
Customer 4
|
|
92%
|
|
—%
|
|
2%
|
|
—%
|
|
—%
|
|
—%
|
Customer 5
|
|
—%
|
|
100%
|
|
—%
|
|
—%
|
|
100%
|
|
—%
|
Customer 6
|
|
94%
|
|
—%
|
|
6%
|
|
—%
|
|
—%
|
|
—%
|
Customer 7
|
|
—%
|
|
—%
|
|
—%
|
|
77%
|
|
23%
|
|
—%
|
Customer 8
|
|
—%
|
|
—%
|
|
—%
|
|
100%
|
|
—%
|
|
—%
|
|
Black Oil
|
|
Refining & Marketing
|
|
Recovery
|
|
Total
|
Balance as of December 31, 2013
|
$3,554,515
|
|
$—
|
|
$948,228
|
|
$4,502,743
|
Acquisitions
|
—
|
|
—
|
|
419,610
|
|
419,610
|
Balance as of September 30, 2014
|
$3,554,515
|
|
$—
|
|
$1,367,838
|
|
$4,922,353
|
Creditor
|
|
Loan Type
|
|
Origination Date
|
|
Maturity Date
|
|
Loan Amount
|
|
Balance on September 30, 2014
|
||||
Bank of America
|
|
Revolving LOC
|
|
May, 2014
|
|
May, 2017
|
|
$
|
20,000,000
|
|
|
$
|
—
|
|
Goldman Sachs USA
|
|
Term Loan
|
|
May, 2014
|
|
May, 2019
|
|
40,000,000
|
|
|
39,400,000
|
|
||
Pacific Western Bank
|
|
Capital Lease
|
|
December, 2010
|
|
December, 2014
|
|
970,974
|
|
|
71,626
|
|
||
Pacific Western Bank
|
|
Capital Lease
|
|
September, 2012
|
|
August, 2017
|
|
520,219
|
|
|
533,816
|
|
||
Various institutions
|
|
Various
|
|
Various
|
|
Various
|
|
2,690,677
|
|
|
2,341,572
|
|
||
E-source note
|
|
Note
|
|
January, 2014
|
|
December, 2014
|
|
854,050
|
|
|
218,016
|
|
||
Various institutions
|
|
Insurance premiums financed
|
|
Various
|
|
> 1 year
|
|
1,789,481
|
|
|
862,409
|
|
||
|
|
|
|
|
|
|
|
$
|
66,825,401
|
|
|
$
|
43,427,439
|
|
Creditor
|
|
Q4 2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
Thereafter
|
||||||||||||||
Goldman Sachs USA
|
|
$
|
300,000
|
|
|
$
|
2,700,000
|
|
|
$
|
3,200,000
|
|
|
$
|
3,200,000
|
|
|
$
|
3,200,000
|
|
|
$
|
3,200,000
|
|
|
$
|
23,600,000
|
|
Pacific Western Bank
|
|
71,625
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Pacific Western Bank
|
|
41,060
|
|
|
172,654
|
|
|
186,948
|
|
|
133,154
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Various institutions
|
|
30,394
|
|
|
305,293
|
|
|
323,178
|
|
|
342,204
|
|
|
263,918
|
|
|
236,066
|
|
|
840,519
|
|
|||||||
E-source note
|
|
218,017
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Various institutions
|
|
531,722
|
|
|
330,687
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Totals
|
|
$
|
1,192,818
|
|
|
$
|
3,508,634
|
|
|
$
|
3,710,126
|
|
|
$
|
3,675,358
|
|
|
$
|
3,463,918
|
|
|
$
|
3,436,066
|
|
|
$
|
24,440,519
|
|
|
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life (in
Years)
|
|
Grant Date
Fair Value
|
||||||
Outstanding at December 31, 2013
|
|
3,060,834
|
|
|
$
|
5.89
|
|
|
6.07
|
|
|
$
|
1,327,163
|
|
Options granted
|
|
250,000
|
|
|
7.91
|
|
|
9.80
|
|
|
501,893
|
|
||
Options forfeited/expired
|
|
(91,667
|
)
|
|
10.78
|
|
|
—
|
|
|
(29,335
|
)
|
||
Options exercised
|
|
(634,000
|
)
|
|
(0.87
|
)
|
|
—
|
|
|
(262,241
|
)
|
||
Outstanding at September 30, 2014
|
|
2,585,167
|
|
|
$
|
7.14
|
|
|
5.54
|
|
|
$
|
1,537,480
|
|
Vested at September 30, 2014
|
|
1,820,480
|
|
|
$
|
8.34
|
|
|
4.88
|
|
|
$
|
657,010
|
|
Exercisable at September 30, 2014
|
|
1,820,480
|
|
|
$
|
8.34
|
|
|
4.88
|
|
|
$
|
657,010
|
|
|
|
Shares
|
|
Weighted
Average Exercise Price |
|
Weighted
Average Remaining Contractual Life (in Years) |
|
Grant Date
Fair Value |
||||||
Outstanding at December 31, 2013
|
|
7,083
|
|
|
$
|
2.72
|
|
|
1.57
|
|
|
$
|
2,900
|
|
Warrants exercised
|
|
(6,250
|
)
|
|
(1.75
|
)
|
|
—
|
|
|
(2,800
|
)
|
||
Warrants cancelled/forfeited/expired
|
|
(833
|
)
|
|
(10.00
|
)
|
|
—
|
|
|
(100
|
)
|
||
Warrants at September 30, 2014
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Vested at September 30, 2014
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Exercisable at September 30, 2014
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
|
2014
|
|
2013
|
||||
Basic Earnings per Share
|
|
|
|
|
||||
Numerator:
|
|
|
|
|
||||
Net income available to common shareholders
|
|
$
|
5,933,877
|
|
|
$
|
5,304,660
|
|
Denominator:
|
|
|
|
|
|
|
||
Weighted-average shares outstanding
|
|
23,077,914
|
|
|
17,402,501
|
|
||
Basic earnings per share
|
|
$
|
0.26
|
|
|
$
|
0.30
|
|
|
|
|
|
|
||||
Diluted Earnings per Share
|
|
|
|
|
|
|
||
Numerator:
|
|
|
|
|
|
|
||
Net income available to common shareholders
|
|
$
|
5,933,877
|
|
|
$
|
5,304,660
|
|
Denominator:
|
|
|
|
|
|
|
||
Weighted-average shares outstanding
|
|
23,077,914
|
|
|
17,402,501
|
|
||
Effect of dilutive securities
|
|
|
|
|
|
|
||
Stock options and warrants
|
|
1,116,993
|
|
|
1,039,925
|
|
||
Preferred stock
|
|
630,419
|
|
|
1,323,837
|
|
||
Diluted weighted-average shares outstanding
|
|
24,825,326
|
|
|
19,766,263
|
|
||
Diluted earnings per share
|
|
$
|
0.24
|
|
|
$
|
0.27
|
|
NINE MONTHS ENDED SEPTEMBER 30, 2014
|
||||||||||||||||
|
|
Black Oil
|
|
Refining &
Marketing
|
|
Recovery
|
|
Total
|
||||||||
Revenues
|
|
$
|
124,884,174
|
|
|
$
|
58,000,951
|
|
|
$
|
13,447,671
|
|
|
$
|
196,332,796
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from operations
|
|
$
|
388,035
|
|
|
$
|
1,768,043
|
|
|
$
|
(1,482,431
|
)
|
|
$
|
673,647
|
|
NINE MONTHS ENDED SEPTEMBER 30, 2013
|
||||||||||||||||
|
|
Black Oil
|
|
Refining &
Marketing
|
|
Recovery
|
|
Total
|
||||||||
Revenues
|
|
$
|
65,412,393
|
|
|
$
|
38,979,504
|
|
|
$
|
10,804,953
|
|
|
$
|
115,196,850
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income from operations
|
|
$
|
1,276,173
|
|
|
$
|
2,260,834
|
|
|
$
|
2,092,510
|
|
|
$
|
5,629,517
|
|
THREE MONTHS ENDED SEPTEMBER 30, 2014
|
||||||||||||||||
|
|
Black Oil
|
|
Refining &
Marketing |
|
Recovery
|
|
Total
|
||||||||
Revenues
|
|
$
|
52,434,252
|
|
|
$
|
19,655,674
|
|
|
$
|
4,813,590
|
|
|
$
|
76,903,516
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income (loss) from operations
|
|
$
|
(749,043
|
)
|
|
$
|
229,260
|
|
|
$
|
(606,902
|
)
|
|
$
|
(1,126,685
|
)
|
THREE MONTHS ENDED SEPTEMBER 30, 2013
|
||||||||||||||||
|
|
Black Oil
|
|
Refining &
Marketing |
|
Recovery
|
|
Total
|
||||||||
Revenues
|
|
$
|
22,719,678
|
|
|
$
|
15,913,554
|
|
|
$
|
8,197,415
|
|
|
$
|
46,830,647
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from operations
|
|
$
|
(791,121
|
)
|
|
$
|
1,158,637
|
|
|
$
|
2,021,504
|
|
|
$
|
2,389,020
|
|
|
|
Estimated Cost
(in thousands)
|
|
Useful life
(years)
|
||
Non-Competes
|
|
$
|
66
|
|
|
1
|
Technology
|
|
2,287
|
|
|
15
|
|
Total
|
|
$
|
2,353
|
|
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2014
|
|
2013
|
||||
Revenues
|
|
$
|
234,957,949
|
|
|
$
|
221,836,815
|
|
Income from operations
|
|
1,478,186
|
|
|
8,047,532
|
|
||
|
|
|
|
|
||||
Net income
|
|
6,216,035
|
|
|
7,329,101
|
|
||
|
|
|
|
|
||||
Net loss attributable to non-controlling interest
|
|
325,399
|
|
|
—
|
|
||
|
|
|
|
|
||||
Net income attributable to Vertex Energy, Inc.
|
|
$
|
6,541,434
|
|
|
$
|
7,329,101
|
|
|
|
|
|
|
||||
Earnings per common share
|
|
|
|
|
||||
Basic
|
|
$0.28
|
|
$0.42
|
||||
Diluted
|
|
$0.26
|
|
$0.37
|
•
|
The Company failed to make a prepayment of the term loan under the Goldman Sachs Credit Agreement in the amount of
$6,299,567
which was due on August 31, 2014, which was required because the Company did not maintain a less than
4
:1 Ratio of Consolidated Total Debt to Consolidated Pro Forma Adjusted EBITDA for the twelve month period ending on August 31, 2014 (the actual Ratio of Consolidated Total Debt for the twelve month period ending on August 31, 2014 was
4.6
:1); and
|
•
|
The Company failed to maintain a fixed charge coverage ratio of not less than
1.25
to 1.00 for three month period ending September 30, 2014 (the actual fixed charge coverage ratio for the period ending September 30, 2014 was
1.00
to 1.00).
|
•
|
The Company entering into various letters of intent in violation of the permitted activities covenants of the Goldman Sachs Credit Agreement; and
|
•
|
The Company failing to timely comply with various post-closing obligations set forth in the credit agreements including, among others, to deliver certificates of title of Company vehicles to the lenders, assignments of rights under various agreements from the Company to Vertex Operating, confirmation of the closing or transfer of various Company bank accounts, various surveys of mortgaged properties, and delivering a collateral access agreement to BOA.
|
•
|
risks associated with our outstanding credit facilities, including amounts owed, restrictive covenants and security interests thereon;
|
•
|
the level of competition in our industry and our ability to compete;
|
•
|
our ability to respond to changes in our industry;
|
•
|
the loss of key personnel or failure to attract, integrate and retain additional personnel;
|
•
|
our ability to protect our intellectual property and not infringe on others’ intellectual property;
|
•
|
our ability to scale our business;
|
•
|
our ability to maintain supplier relationships and obtain adequate supplies of feedstocks;
|
•
|
our ability to obtain and retain customers;
|
•
|
our ability to produce our products at competitive rates;
|
•
|
our ability to execute our business strategy in a very competitive environment;
|
•
|
trends in, and the market for, the price of oil and gas and alternative energy sources;
|
•
|
our ability to maintain our relationship with KMTEX, Ltd.;
|
•
|
the impact of competitive services and products;
|
•
|
our ability to maintain insurance;
|
•
|
potential future litigation, judgments and settlements;
|
•
|
rules and regulations making our operations more costly or restrictive;
|
•
|
changes in environmental and other laws and regulations and risks associated with such laws and regulations;
|
•
|
economic downturns both in the United States and globally;
|
•
|
risk of increased regulation of our operations and products;
|
•
|
negative publicity and public opposition to our operations;
|
•
|
disruptions in the infrastructure that we and our partners rely on;
|
•
|
an inability to identify attractive acquisition opportunities and successfully negotiate acquisition terms;
|
•
|
our ability to effectively integrate acquired assets, companies, employees or businesses;
|
•
|
liabilities associated with acquired companies, assets or businesses;
|
•
|
interruptions at our facilities;
|
•
|
our ability to complete pending and future acquisitions;
|
•
|
required earn-out payments and other contingent payments we are required to make;
|
•
|
unexpected changes in our anticipated capital expenditures resulting from unforeseen required maintenance, repairs, or upgrades;
|
•
|
our ability to acquire and construct new facilities;
|
•
|
certain events of default which have occurred and are continuing under our debt facilities;
|
•
|
our ability to effectively manage our growth;
|
•
|
repayment of and covenants in our debt facilities;
|
•
|
the lack of capital available on acceptable terms to finance our continued growth; and
|
•
|
other risk factors included under “Risk Factors” below and in our Annual Report on Form 10-K and prior Form 10-Qs.
|
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||
|
|
2014
|
|
2013
|
|
$ Change
|
|
% Change
|
|||||||
Revenues
|
|
$
|
76,903,516
|
|
|
$
|
46,830,647
|
|
|
$
|
30,072,869
|
|
|
64
|
%
|
Cost of Revenues
|
|
72,846,322
|
|
|
41,945,879
|
|
|
(30,900,443
|
)
|
|
(74
|
)%
|
|||
Gross Profit
|
|
4,057,194
|
|
|
4,884,768
|
|
|
(827,574
|
)
|
|
(17
|
)%
|
|||
Reduction of contingent liability
|
|
(1,876,752
|
)
|
|
—
|
|
|
1,876,752
|
|
|
100
|
%
|
|||
Selling, general and administrative expenses
|
|
6,801,396
|
|
|
2,495,748
|
|
|
(4,305,648
|
)
|
|
(173
|
)%
|
|||
Acquisition related expenses
|
|
259,235
|
|
|
—
|
|
|
(259,235
|
)
|
|
(100
|
)%
|
|||
Income (loss) from operations
|
|
(1,126,685
|
)
|
|
2,389,020
|
|
|
(3,515,705
|
)
|
|
(147
|
)%
|
|||
Other Income
|
|
109,980
|
|
|
—
|
|
|
109,980
|
|
|
100
|
%
|
|||
Bargain purchase gain related to Omega acquisition
|
|
92,635
|
|
|
—
|
|
|
92,635
|
|
|
100
|
%
|
|||
Other expense
|
|
—
|
|
|
(3,949
|
)
|
|
3,949
|
|
|
100
|
%
|
|||
Interest Expense
|
|
(947,325
|
)
|
|
(95,488
|
)
|
|
(851,837
|
)
|
|
(892
|
)%
|
|||
Total other income (expense)
|
|
(744,710
|
)
|
|
(99,437
|
)
|
|
(645,273
|
)
|
|
(649
|
)%
|
|||
Income (loss) before income taxes
|
|
(1,871,395
|
)
|
|
2,289,583
|
|
|
(4,160,978
|
)
|
|
(182
|
)%
|
|||
Income tax (expense) benefit
|
|
(57,975
|
)
|
|
40,211
|
|
|
(98,186
|
)
|
|
(244
|
)%
|
|||
Net income (loss)
|
|
$
|
(1,929,370
|
)
|
|
$
|
2,329,794
|
|
|
$
|
(4,259,164
|
)
|
|
(183
|
)%
|
|
|
Three Months Ended
September 30, |
|
|
|
|
|||||||||
Black Oil Segment
|
|
2014
|
|
2013
|
|
$ Change
|
|
% Change
|
|||||||
Total revenue
|
|
$
|
52,434,252
|
|
|
$
|
22,719,678
|
|
|
$
|
29,714,574
|
|
|
131
|
%
|
Total cost of revenue
|
|
49,933,205
|
|
|
21,586,736
|
|
|
(28,346,469
|
)
|
|
(131
|
)%
|
|||
Gross profit
|
|
2,501,047
|
|
|
1,132,942
|
|
|
1,368,105
|
|
|
121
|
%
|
|||
Reduction in contingent consideration
|
|
1,876,752
|
|
|
—
|
|
|
1,876,752
|
|
|
100
|
%
|
|||
Selling general and administrative expense
|
|
5,126,842
|
|
|
1,924,063
|
|
|
(3,202,779
|
)
|
|
(166
|
)%
|
|||
Income from operations
|
|
$
|
(749,043
|
)
|
|
$
|
(791,121
|
)
|
|
$
|
42,078
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Refining Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total revenue
|
|
$
|
19,655,674
|
|
|
$
|
15,913,554
|
|
|
$
|
3,742,120
|
|
|
24
|
%
|
Total cost of revenue
|
|
18,679,687
|
|
|
14,244,023
|
|
|
(4,435,664
|
)
|
|
(31
|
)%
|
|||
Gross profit
|
|
975,987
|
|
|
1,669,531
|
|
|
(693,544
|
)
|
|
(42
|
)%
|
|||
Selling general and administrative expense
|
|
746,727
|
|
|
510,894
|
|
|
(235,833
|
)
|
|
(46
|
)%
|
|||
Income from operations
|
|
$
|
229,260
|
|
|
$
|
1,158,637
|
|
|
$
|
(929,377
|
)
|
|
(80
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Recovery Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total revenue
|
|
$
|
4,813,590
|
|
|
$
|
8,197,415
|
|
|
$
|
(3,383,825
|
)
|
|
(41
|
)%
|
Total cost of revenue
|
|
4,233,430
|
|
|
6,115,120
|
|
|
1,881,690
|
|
|
31
|
%
|
|||
Gross profit
|
|
580,160
|
|
|
2,082,295
|
|
|
(1,502,135
|
)
|
|
(72
|
)%
|
|||
Selling general and administrative expense
|
|
1,187,062
|
|
|
60,791
|
|
|
(1,126,271
|
)
|
|
(1,853
|
)%
|
|||
Income (loss) from operations
|
|
$
|
(606,902
|
)
|
|
$
|
2,021,504
|
|
|
$
|
(2,628,406
|
)
|
|
(130
|
)%
|
|
Three Months Ended September 30, 2014
|
|
|||||
|
Consolidated Results
|
Omega Refining
|
% Contributed by Omega Refining
|
||||
Total Revenue
|
$
|
76,903,516
|
|
$
|
32,973,450
|
|
43%
|
Gross Profit
|
4,057,194
|
|
2,047,560
|
|
50%
|
||
|
|
|
|
||||
|
Consolidated Results
|
E-Source
|
% Contributed by E-Source
|
||||
Total Revenue
|
$
|
76,903,516
|
|
$
|
1,732,967
|
|
2%
|
Gross Profit
|
4,057,194
|
|
327,805
|
|
8%
|
2013
|
|
|
|
|
|
|
|
|
||||
Benchmark
|
|
High
|
|
Date
|
|
Low
|
|
Date
|
||||
U.S. Gulfcoast No. 2 Waterborne (dollars per gallon)
|
|
$
|
3.25
|
|
|
February 12
|
|
$
|
2.57
|
|
|
April 17
|
U.S. Gulfcoast Unleaded 87 Waterborne (dollars per gallon)
|
|
$
|
3.21
|
|
|
February 15
|
|
$
|
2.52
|
|
|
September 23
|
U.S. Gulfcoast Residual Fuel No. 6 3% (dollars per barrel)
|
|
$
|
101.02
|
|
|
February 14
|
|
$
|
87.49
|
|
|
April 17
|
NYMEX Crude oil (Dollars per barrel)
|
|
$
|
110.10
|
|
|
August 28
|
|
$
|
86.68
|
|
|
April 17
|
Reported in Platt's US Marketscan (Gulf Coast)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
|
|
2014
|
|
2013
|
|
$ Change
|
|
% Change
|
|||||||
Revenues
|
|
$
|
196,332,796
|
|
|
$
|
115,196,850
|
|
|
$
|
81,135,946
|
|
|
70
|
%
|
Cost of Revenues
|
|
178,252,434
|
|
|
104,287,660
|
|
|
$
|
(73,964,774
|
)
|
|
(71
|
)%
|
||
Gross Profit
|
|
18,080,362
|
|
|
10,909,190
|
|
|
7,171,172
|
|
|
66
|
%
|
|||
Reduction of contingent liability
|
|
(1,876,752
|
)
|
|
(1,850,000
|
)
|
|
26,752
|
|
|
1
|
%
|
|||
Selling, general and administrative expenses
|
|
16,464,402
|
|
|
7,129,673
|
|
|
(9,334,729
|
)
|
|
(131
|
)%
|
|||
Acquisition related expenses
|
|
2,819,065
|
|
|
—
|
|
|
(2,819,065
|
)
|
|
(100
|
)%
|
|||
Income from operations
|
|
673,647
|
|
|
5,629,517
|
|
|
(4,955,870
|
)
|
|
(88
|
)%
|
|||
Other Income
|
|
110,357
|
|
|
—
|
|
|
110,357
|
|
|
100
|
%
|
|||
Bargain purchase gain related to Omega acquisition
|
|
6,573,686
|
|
|
—
|
|
|
6,573,686
|
|
|
100
|
%
|
|||
Other expense
|
|
(10,866
|
)
|
|
(31,690
|
)
|
|
20,824
|
|
|
66
|
%
|
|||
Interest Expense
|
|
(1,680,371
|
)
|
|
(314,627
|
)
|
|
(1,365,744
|
)
|
|
(434
|
)%
|
|||
Total other income (expense)
|
|
4,992,806
|
|
|
(346,317
|
)
|
|
5,339,123
|
|
|
(1,542
|
)%
|
|||
Income before income taxes
|
|
5,666,453
|
|
|
5,283,200
|
|
|
383,253
|
|
|
7
|
%
|
|||
Income tax (expense) benefit
|
|
(57,975
|
)
|
|
21,460
|
|
|
(79,435
|
)
|
|
(370
|
)%
|
|||
Net income
|
|
5,608,478
|
|
|
5,304,660
|
|
|
303,818
|
|
|
6
|
%
|
|||
Net loss attributable to non-controlling interest
|
|
325,399
|
|
|
—
|
|
|
325,399
|
|
|
100
|
%
|
|||
Net income attributable to Vertex Energy, Inc.
|
|
$
|
5,933,877
|
|
|
$
|
5,304,660
|
|
|
$
|
629,217
|
|
|
12
|
%
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
Black Oil Segment
|
|
2014
|
|
2013
|
|
$ Change
|
|
% Change
|
|||||||
Total revenue
|
|
$
|
124,884,174
|
|
|
$
|
65,412,393
|
|
|
$
|
59,471,781
|
|
|
91
|
%
|
Total cost of revenue
|
|
113,355,127
|
|
|
60,471,980
|
|
|
(52,883,147
|
)
|
|
(87
|
)%
|
|||
Gross profit
|
|
11,529,047
|
|
|
4,940,413
|
|
|
6,588,634
|
|
|
133
|
%
|
|||
Reduction in contingent consideration
|
|
1,876,752
|
|
|
1,850,000
|
|
|
26,752
|
|
|
1
|
%
|
|||
Selling general and administrative expense
|
|
13,017,764
|
|
|
5,514,240
|
|
|
(7,503,524
|
)
|
|
(136
|
)%
|
|||
Income from operations
|
|
$
|
388,035
|
|
|
$
|
1,276,173
|
|
|
$
|
(888,138
|
)
|
|
(70
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Refining Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Total revenue
|
|
$
|
58,000,951
|
|
|
$
|
38,979,504
|
|
|
$
|
19,021,447
|
|
|
49
|
%
|
Total cost of revenue
|
|
53,555,931
|
|
|
35,293,112
|
|
|
(18,262,819
|
)
|
|
(52
|
)%
|
|||
Gross profit
|
|
4,445,020
|
|
|
3,686,392
|
|
|
758,628
|
|
|
21
|
%
|
|||
Selling general and administrative expense
|
|
2,676,977
|
|
|
1,425,558
|
|
|
(1,251,419
|
)
|
|
(88
|
)%
|
|||
Income from operations
|
|
$
|
1,768,043
|
|
|
$
|
2,260,834
|
|
|
$
|
(492,791
|
)
|
|
(22
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Recovery Segment
|
|
|
|
|
|
|
|
|
|||||||
Total revenue
|
|
$
|
13,447,671
|
|
|
$
|
10,804,953
|
|
|
$
|
2,642,718
|
|
|
24
|
%
|
Total cost of revenue
|
|
11,341,376
|
|
|
8,522,568
|
|
|
(2,818,808
|
)
|
|
(33
|
)%
|
|||
Gross profit
|
|
2,106,295
|
|
|
2,282,385
|
|
|
(176,090
|
)
|
|
(8
|
)%
|
|||
Selling general and administrative expense
|
|
3,588,726
|
|
|
189,875
|
|
|
(3,398,851
|
)
|
|
(1,790
|
)%
|
|||
Income (loss) from operations
|
|
$
|
(1,482,431
|
)
|
|
$
|
2,092,510
|
|
|
$
|
(3,574,941
|
)
|
|
(171
|
)%
|
|
Nine Months Ended September 30, 2014
|
|
|||||
|
Consolidated Results
|
Omega Refining
|
% Contributed by Omega Refining
|
||||
Total Revenue
|
$
|
196,332,796
|
|
$
|
51,077,061
|
|
26%
|
Gross Profit
|
18,080,362
|
|
4,867,522
|
|
27%
|
||
|
|
|
|
||||
|
Consolidated Results
|
E-Source
|
% Contributed by E-Source
|
||||
Total Revenue
|
$
|
196,332,796
|
|
$
|
6,320,286
|
|
3%
|
Gross Profit
|
18,080,362
|
|
1,562,879
|
|
9%
|
|
|
Statements of Operations by Quarter
|
|||||||||||||||||||||||||||
|
|
Fiscal 2014
|
|
Fiscal 2013
|
|
||||||||||||||||||||||||
|
|
Third
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
||||||||||||||
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues
|
|
$
|
76,903,516
|
|
|
$
|
72,079,622
|
|
|
$
|
47,349,658
|
|
|
$
|
46,770,402
|
|
|
$
|
46,830,647
|
|
|
$
|
35,111,402
|
|
|
$
|
33,254,801
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of Revenues
|
|
72,846,322
|
|
|
63,200,942
|
|
|
42,205,170
|
|
|
41,340,555
|
|
|
41,945,879
|
|
|
32,556,738
|
|
|
29,785,043
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross Profit
|
|
4,057,194
|
|
|
8,878,680
|
|
|
5,144,488
|
|
|
5,429,847
|
|
|
4,884,768
|
|
|
2,554,664
|
|
|
3,469,758
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Reduction of contingent liability
|
|
(1,876,752
|
)
|
|
—
|
|
|
—
|
|
|
(388,750
|
)
|
|
—
|
|
|
(1,850,000
|
)
|
|
—
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Selling, general and administrative expenses
|
|
6,801,396
|
|
|
6,075,517
|
|
|
3,587,489
|
|
|
4,359,857
|
|
|
2,495,748
|
|
|
2,395,745
|
|
|
2,221,492
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Acquisition related expenses
|
|
259,235
|
|
|
1,959,418
|
|
|
600,412
|
|
|
17,150
|
|
|
—
|
|
|
—
|
|
|
36,592
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total selling, general and administrative expenses
|
|
7,060,631
|
|
|
8,034,935
|
|
|
4,187,901
|
|
|
4,377,007
|
|
|
2,495,748
|
|
|
2,395,745
|
|
|
2,258,084
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income (loss) from operations
|
|
(1,126,685
|
)
|
|
843,745
|
|
|
956,587
|
|
|
1,441,590
|
|
|
2,389,020
|
|
|
2,008,919
|
|
|
1,211,674
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Other income
|
|
109,980
|
|
|
7
|
|
|
370
|
|
|
4,809
|
|
|
—
|
|
|
7,598
|
|
|
25,289
|
|
|
|||||||
Bargain purchase gain
|
|
92,635
|
|
|
6,481,051
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||||
Other expense
|
|
—
|
|
|
(10,866
|
)
|
|
—
|
|
|
(9,838
|
)
|
|
(3,949
|
)
|
|
—
|
|
|
(40,726
|
)
|
|
|||||||
Interest expense
|
|
(947,325
|
)
|
|
(657,235
|
)
|
|
(75,811
|
)
|
|
(108,327
|
)
|
|
(95,488
|
)
|
|
(112,999
|
)
|
|
(106,140
|
)
|
|
|||||||
Total other income (expense)
|
|
(744,710
|
)
|
|
5,812,957
|
|
|
(75,441
|
)
|
|
(113,356
|
)
|
|
(99,437
|
)
|
|
(105,401
|
)
|
|
(121,577
|
)
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income (loss) before income taxes
|
|
(1,871,395
|
)
|
|
6,656,702
|
|
|
881,146
|
|
|
1,328,234
|
|
|
2,289,583
|
|
|
1,903,518
|
|
|
1,090,097
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Income tax benefit (expense)
|
|
(57,975
|
)
|
|
—
|
|
|
—
|
|
|
1,678,539
|
|
|
40,211
|
|
|
(12,248
|
)
|
|
(6,502
|
)
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net income (loss)
|
|
$
|
(1,929,370
|
)
|
|
$
|
6,656,702
|
|
|
$
|
881,146
|
|
|
$
|
3,006,773
|
|
|
$
|
2,329,794
|
|
|
$
|
1,891,270
|
|
|
$
|
1,083,595
|
|
|
Net income attributable to non controlling interest
|
|
—
|
|
|
344,380
|
|
|
(18,981
|
)
|
|
(431,962
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|||||||
Net income attributable to Vertex Energy, Inc.
|
|
$
|
(1,929,370
|
)
|
|
$
|
7,001,082
|
|
|
$
|
862,165
|
|
|
$
|
2,574,811
|
|
|
$
|
2,329,794
|
|
|
$
|
1,891,270
|
|
|
$
|
1,083,595
|
|
|
Number of weighted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Basic
|
|
25,151,660
|
|
|
22,826,102
|
|
|
21,232,949
|
|
|
17,830,194
|
|
|
17,715,786
|
|
|
17,409,034
|
|
|
17,079,242
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Diluted
|
|
25,151,660
|
|
|
24,847,456
|
|
|
21,738,018
|
|
|
20,182,829
|
|
|
19,997,257
|
|
|
19,887,288
|
|
|
20,139,182
|
|
|
|
Statements of Operations by Segments
|
|||||||||||||||||||||||||||
|
Fiscal 2014
|
|
Fiscal 2013
|
|
||||||||||||||||||||||||
|
Third
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
||||||||||||||
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
||||||||||||||
Black Oil
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues
|
$
|
52,434,252
|
|
|
$
|
48,878,522
|
|
|
$
|
23,571,400
|
|
|
$
|
23,660,574
|
|
|
$
|
22,766,929
|
|
|
$
|
19,493,407
|
|
|
$
|
23,199,308
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of revenues
|
49,933,205
|
|
|
42,330,639
|
|
|
21,091,283
|
|
|
21,717,508
|
|
|
21,632,211
|
|
|
18,363,098
|
|
|
20,416,314
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross profit
|
$
|
2,501,047
|
|
|
$
|
6,547,883
|
|
|
$
|
2,480,117
|
|
|
$
|
1,943,066
|
|
|
$
|
1,134,718
|
|
|
$
|
1,130,309
|
|
|
$
|
2,782,994
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Refining & Marketing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues
|
$
|
19,655,674
|
|
|
$
|
18,517,819
|
|
|
$
|
19,827,459
|
|
|
$
|
16,749,930
|
|
|
$
|
15,913,554
|
|
|
$
|
14,234,204
|
|
|
$
|
8,831,746
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of revenues
|
18,679,687
|
|
|
16,626,178
|
|
|
18,250,066
|
|
|
15,207,097
|
|
|
14,244,023
|
|
|
12,824,955
|
|
|
8,224,134
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross profit
|
$
|
975,987
|
|
|
$
|
1,891,641
|
|
|
$
|
1,577,393
|
|
|
$
|
1,542,833
|
|
|
$
|
1,669,531
|
|
|
$
|
1,409,249
|
|
|
$
|
607,612
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Recovery
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues
|
$
|
4,813,590
|
|
|
$
|
4,683,281
|
|
|
$
|
3,950,799
|
|
|
$
|
6,359,898
|
|
|
$
|
8,150,164
|
|
|
$
|
1,383,791
|
|
|
$
|
1,223,747
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Cost of revenues
|
4,233,430
|
|
|
4,244,125
|
|
|
2,863,821
|
|
|
4,415,950
|
|
|
6,069,645
|
|
|
1,368,685
|
|
|
1,144,595
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross profit
|
$
|
580,160
|
|
|
$
|
439,156
|
|
|
$
|
1,086,978
|
|
|
$
|
1,943,948
|
|
|
$
|
2,080,519
|
|
|
$
|
15,106
|
|
|
$
|
79,152
|
|
|
•
|
The Company failed to make a prepayment of the term loan under the Goldman Sachs Credit Agreement in the amount of $6,299,567 which was done on August 31, 2014, which was required because the Company did not maintain a less than 4:1 Ratio of Consolidated Total Debt to Consolidated Pro Forma Adjusted EBITDA for the twelve month period ending on August 31, 2014 was 4.6 and
|
•
|
The Company failed to maintain a fixed charge coverage ratio of not less than 1.25 to 1.00 for the period ending September 30, 2014 (the actual fixed charge coverage ratio for the period ending September 30, 2014 was 1.00 to 1.00) .
|
•
|
The Company entering into various letters of intent in violation of the permitted activities covenants of the Goldman Sachs Credit Agreement; and
|
•
|
The Company failing to timely comply with various post-closing obligations set forth in the credit agreements including, among others, to deliver certificates of title of Company vehicles to the lenders, assignments of rights under various agreements from the Company to Vertex Operating, confirmation of the closing or transfer of various Company bank accounts, various surveys of mortgaged properties, and delivering a collateral access agreement to BOA.
|
(1)
|
actual or anticipated variations in our results of operations;
|
(2)
|
our ability or inability to generate new revenues; and
|
(3)
|
the number of shares in our public float.
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2014
|
|
2013
|
||||
Beginning cash and cash equivalents
|
|
$
|
2,678,628
|
|
|
$
|
807,940
|
|
Net cash provided by (used in):
|
|
|
|
|
|
|
||
Operating activities
|
|
(11,534,246
|
)
|
|
5,354,198
|
|
||
Investing activities
|
|
(34,391,520
|
)
|
|
(1,063,709
|
)
|
||
Financing activities
|
|
44,476,884
|
|
|
(4,567,203
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
|
(1,448,882
|
)
|
|
(276,714
|
)
|
||
Ending cash and cash equivalents
|
|
$
|
1,229,746
|
|
|
$
|
531,226
|
|
•
|
increase our vulnerability to adverse changes in general economic, industry and competitive conditions;
|
•
|
require us to dedicate a substantial portion of our cash flow from operations to make payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate purposes;
|
•
|
limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
|
•
|
restrict us from taking advantage of business opportunities;
|
•
|
make it more difficult to satisfy our financial obligations;
|
•
|
place us at a competitive disadvantage compared to our competitors that have less debt obligations; and
|
•
|
limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions, debt service requirements, execution of our business strategy or other general corporate purposes on satisfactory terms or at all.
|
•
|
The Company failed to make a prepayment of the term loan under the Goldman Sachs Credit Agreement in the amount of $6,299,567 which was done on August 31, 2014, which was required because the Company did not maintain a less than 4:1 Ratio of Consolidated Total Debt to Consolidated Pro Forma Adjusted EBITDA for the twelve month period ending on August 31, 2014 was 1:4.6 and
|
•
|
The Company failed to maintain a fixed charge coverage ratio of not less than 1.25 to 1.00 for the period ending September 30, 2014 (the actual fixed charge coverage ratio for the period ending September 30, 2014 was 1.00 to 1.00) .
|
•
|
The Company entering into various letters of intent in violation of the permitted activities covenants of the Goldman Sachs Credit Agreement; and
|
•
|
The Company failing to timely comply with various post-closing obligations set forth in the credit agreements including, among others, to deliver certificates of title of Company vehicles to the lenders, assignments of rights under various agreements from the Company to Vertex Operating, confirmation of the closing or transfer of various Company bank accounts, various surveys of mortgaged properties, and delivering a collateral access agreement to BOA.
|
•
|
The Company failed to make a prepayment of the term loan under the Goldman Sachs Credit Agreement in the amount of $6,299,567 which was due on August 31, 2014, which was required because the Company did not maintain a less than 4:1 Ratio of Consolidated Total Debt to Consolidated Pro Forma Adjusted EBITDA for the twelve month period ending on August 31, 2014 (the actual Ratio of Consolidated Total Debt for the twelve month period ending on August 31, 2014 was 1:4.6); and
|
•
|
The Company failed to maintain a fixed charge coverage ratio of not less than 1.25 to 1.00 for the period ending September 30, 2014 (the actual fixed charge coverage ratio for the period ending September 30, 2014 was 1.00 to 1.00).
|
•
|
The Company entering into various letters of intent in violation of the permitted activities covenants of the Goldman Sachs Credit Agreement; and
|
•
|
The Company failing to timely comply with various post-closing obligations set forth in the credit agreements including, among others, to deliver certificates of title of Company vehicles to the lenders, assignments of rights under various agreements from the Company to Vertex Operating, confirmation of the closing or transfer of various Company bank accounts, various surveys of mortgaged properties, and delivering a collateral access agreement to BOA.
|
Name and Principal
Position
|
|
Fiscal
2013 Bonus
|
|
Total Fiscal 2013
Compensation as Reported in
the Proxy Statement
|
|
Total Fiscal 2013
Compensation Including Fiscal
2013 Bonus
|
|||||||||
|
|
|
|
|
|
|
|||||||||
Benjamin P. Cowart
Chairman, CEO and President
|
|
|
$
|
543,960
|
|
|
|
$
|
270,567
|
|
|
|
$
|
814,527
|
|
|
VERTEX ENERGY, INC.
|
|
|
Date: November 14, 2014
|
By: /s/ Benjamin P. Cowart
|
|
Benjamin P. Cowart
|
|
Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
|
|
Date: November 14, 2014
|
By: /s/ Chris Carlson
|
|
Chris Carlson
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
Incorporated by Reference
|
|||||||
Exhibit Number
|
|
Description of Exhibit
|
|
Filed or Furnished Herewith
|
|
Form
|
|
Exhibit
|
|
Filing Date/Period End Date
|
|
File No.
|
|
1.1
|
|
Underwriting Agreement, dated November 20, 2013, by and among Vertex Energy, Inc. and Craig-Hallum Capital Group LLC
|
|
|
|
8-K
|
|
1.1
|
|
|
11/21/2013
|
|
001-11476
|
2.1
|
|
Unit Purchase Agreement by and among Vertex Energy, Inc., Vertex Acquisition Sub, LLC, Vertex Holdings, L.P. and B&S Cowart Family L.P. dated as of August 14, 2012
|
|
|
|
8-K
|
|
2.1
|
|
|
8/15/2012
|
|
000-53619
|
2.2
|
|
First Amendment to Unit Purchase Agreement by and among Vertex Energy, Inc., Vertex Acquisition Sub, LLC, Vertex Holdings, L.P. and B&S Cowart Family L.P. dated as of September 11, 2012
|
|
|
|
8-K
|
|
2.2
|
|
|
9/12/2012
|
|
000-53619
|
2.3
|
|
Asset Purchase Agreement by and among Vertex Energy, Inc., Vertex Refining LA, LLC.,Vertex Refining NV., LLC, Omega Refining, LLC, Bango Refining NV, LLC and Omega Holdings Company LLC (March 17, 2014)
|
|
|
|
8-K
|
|
2.1
|
|
|
3/19/2014
|
|
001-11476
|
2.4
|
|
First Amendment to Asset Purchase Agreement by and among Vertex Energy, Inc., Vertex Refining LA, LLC, Vertex Refining NV, LLC, Omega Refining, LLC, Bango Refining NV, LLC and Omega Holdings Company LLC (April 14, 2014)
|
|
|
|
8-K
|
|
2.2
|
|
|
4/15/2014
|
|
001-11476
|
2.5
|
|
Second Amendment to Asset Purchase Agreement by and among Vertex Energy, Inc., Vertex Refining LA, LLC, Vertex Refining NV, LLC, Bango Refining NV, LLC and Omega Holdings Company LLC (April 30, 2014)
|
|
|
|
8-K
|
|
2.3
|
|
|
5/6/2014
|
|
001-11476
|
2.6(#)
|
|
Third Amendment to Asset Purchase Agreement by and among Vertex Energy, Inc., Vertex Refining LA, LLC, Vertex Refining NV, LLC, Bango Refining NV, LLC and Omega Holdings Company LLC (May 2, 2014)
|
|
|
|
8-K
|
|
2.4
|
|
|
5/6/2014
|
|
001-11476
|
2.7
|
|
Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy Inc. and Heartland Group Holdings, LLC (October 21, 2014)
|
|
|
|
8-K
|
|
2.1
|
|
|
10/27/2014
|
|
001-11476
|
4.1
|
|
Vertex Energy, Inc. - 2013 Stock Incentive Plan
|
|
|
|
S-8
|
|
4.1
|
|
|
7/28/2014
|
|
333-197659
|
4.2
|
|
Vertex Energy, Inc. - Form of 2013 Stock Incentive Plan Restricted Stock Grant Agreement
|
|
|
|
S-8
|
|
4.3
|
|
|
7/28/2014
|
|
333-197659
|
10.1(+)
|
|
Tolling Agreement between KMTEX, Ltd. and Vertex Energy Inc., dated April 17, 2013
|
|
|
|
8-K
|
|
10.1
|
|
|
11/12/2013
|
|
001-11476
|
10.2
|
|
Credit Agreement between Vertex Energy Inc. and Bank of America, N.A. dated August 31, 2012
|
|
|
|
8-K
|
|
10.1
|
|
|
9/12/2012
|
|
000-53619
|
10.3
|
|
$10,000,000 Revolving Note by Vertex Energy, Inc. in favor of Bank of America, N.A. dated August 31, 2012
|
|
|
|
8-K
|
|
10.2
|
|
|
9/12/2012
|
|
000-53619
|
10.4
|
|
$8,500,000 Term Note by Vertex Energy, Inc. in favor of Bank of America, N.A. dated August 31, 2012
|
|
|
|
8-K
|
|
10.3
|
|
|
9/12/2012
|
|
000-53619
|
10.5
|
|
Security Agreement with Bank of America, N.A. dated August 31, 2012
|
|
|
|
8-K
|
|
10.40
|
|
|
9/12/2012
|
|
000-53619
|
10.6
|
|
Corporate Guaranty in favor of Bank of America, N.A. dated August 31, 2012
|
|
|
|
8-K
|
|
10.5
|
|
|
9/12/2012
|
|
000-53619
|
10.7
|
|
First Amendment to Credit Agreement between Vertex Energy, Inc. and Bank of America, N.A. dated August 31, 2012
|
|
|
|
10-Q
|
|
10.18
|
|
|
9/30/2012
|
|
000-53619
|
10.8(#)
|
|
Secured Promissory Note ($13,858,066.67)-May 2, 2014-Omega Refining, LLC and Bango Refining NV, LLC as borrowers and Vertex Refining NV, LLC as lender
|
|
|
|
8-K
|
|
10.1
|
|
|
5/6/2014
|
|
001-11476
|
10.9
|
|
Guaranty Agreement-Omega Holdings-May 2, 2014
|
|
|
|
8-K
|
|
10.2
|
|
|
5/6/2014
|
|
001-11476
|
10.10(#)
|
|
Credit and Guaranty Agreement dated as of May 2, 2014, by and among Vertex Energy Operating, LLC, Vertex Energy, Inc., and certain other subsidiaries of Vertex Energy, Inc., as Guarantors, and Goldman Sachs USA, as Lender and as Administrative Agent, Collateral Agent, and Lead Arranger
|
|
|
|
8-K
|
|
10.3
|
|
|
5/6/2014
|
|
001-11476
|
10.11
|
|
Term Loan Note ($40,000,000)-Credit and Guaranty Agreement dated as of May 2, 2014
|
|
|
|
8-K
|
|
10.4
|
|
|
5/6/2014
|
|
001-11476
|
10.12(#)
|
|
Pledge and Security Agreement-Credit and Guaranty Agreement dated as of May 2, 2014
|
|
|
|
8-K
|
|
10.5
|
|
|
5/6/2014
|
|
001-11476
|
10.13(#)
|
|
Amended and Restated Credit Agreement, among Vertex Energy, Inc., and Vertex Energy Operating, LLC, as Borrowers and Bank of America, N.A., as Lender as of May 2, 2014
|
|
|
|
8-K
|
|
10.6
|
|
|
5/6/2014
|
|
001-11476
|
10.14
|
|
Revolving Note ($20,000,000)-Amended and Restated Credit Agreement, as of May 2, 2014
|
|
|
|
8-K
|
|
10.7
|
|
|
5/6/2014
|
|
001-11476
|
10.15(#)
|
|
Pledge and Security Agreement-Amended and Restated Credit Agreement, as of May 2, 2014
|
|
|
|
8-K
|
|
10.8
|
|
|
5/6/2014
|
|
001-11476
|
10.16
|
|
Amended and Restated Guaranty-Amended and Restated Credit Agreement, as of May 2, 2014
|
|
|
|
8-K
|
|
10.9
|
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|
5/6/2014
|
|
001-11476
|
10.17
|
|
Intercreditor Agreement, May 2, 2014, by and among Bank of America, N.A. and Goldman Sachs Bank USA
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|
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|
8-K
|
|
10.10
|
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|
5/6/2014
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001-11476
|
10.18
|
|
At-Will Employment, Confidential Information, Invention Assignment and Arbitration Agreement with David Peel (April 2014)***
|
|
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|
8-K
|
|
10.1
|
|
|
6/24/14
|
|
001-11476
|
10.19
|
|
Retention and Noncompetition Agreement with David Peel (April 2014)***
|
|
|
|
8-K
|
|
10.2
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6/24/14
|
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001-11476
|
10.20
|
|
Employment Agreement between Vertex Refining LA, LLC and James P. Gregory (Effective May 2, 2014)***
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8-K
|
|
10.1
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|
07/29/2014
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001-11476
|
10.21
|
|
Form of Common Stock Purchase Agreement dated June 5, 2014 by and between Vertex Energy, Inc. and the purchasers named therein
|
|
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|
8-K
|
|
10.1
|
|
|
6/6/2014
|
|
001-11476
|
10.22
|
|
Land Lease between Marrero Terminal LLC, as Landlord and Omega Refining, LLC, as Tenant, relating to the Used Motor Oil Re-Refinery Located at 5000 River Road, Marrero, Louisiana 70094, dated as of April 30, 2008 and amendments
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|
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|
10-Q
|
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10.22
|
|
|
6/30/14
|
|
001-11476
|
10.23
|
|
Commercial Lease between Plaquemines Holdings, LLC as Landlord and Omega Refining, LLC, as Tenant, relating to the Myrtle Grove Facility Located at 278 East Ravenna Road, Myrtle Grove, LA, dated as of May 25, 2012 and amendments
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|
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|
10-Q
|
|
10.23
|
|
|
6/30/14
|
|
001-11476
|
10.24
|
|
Operation and Maintenance Agreement dated as of November 3, 2010, by and between Magellan Terminals Holdings, L.P. (f/k/a Marrero Terminal, LLC) and Omega Refining, LLC
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|
10-Q
|
|
10.24
|
|
|
6/30/14
|
|
001-11476
|
10.25(##)
|
|
Terminaling Services Agreement between Marrero Terminal LLC (Owner) and Omega Refining, LLC (Customer) dated as of May 1, 2008
|
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|
10-Q
|
|
10.25
|
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|
6/30/14
|
|
001-11476
|
10.26(##)
|
|
Second Use Motor Oil Buy/Sell Contract dated August 1, 2012, by and between Thermo Fluids, Inc. and Omega Refining, LLC
|
|
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|
10-Q
|
|
10.26
|
|
|
6/30/14
|
|
001-11476
|
10.27
|
|
Consulting Agreement, Timothy C. Harvey (October 3, 2014)***
|
|
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|
8-K
|
|
10.1
|
|
|
10/9/14
|
|
001-11476
|
10.28
|
|
Consulting Agreement between Heartland Group Holdings, LLC and Vertex Energy Operating, LLC (July 28, 2014)
|
|
|
|
8-K
|
|
10.1
|
|
|
10/27/14
|
|
001-11476
|
31.1
|
|
Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act*
|
|
X
|
|
|
|
|
|
|
|
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|
31.2
|
|
Certification of Principal Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act*
|
|
X
|
|
|
|
|
|
|
|
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|
32.1
|
|
Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act**
|
|
X
|
|
|
|
|
|
|
|
|
|
32.2
|
|
Certification of Principal Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act**
|
|
X
|
|
|
|
|
|
|
|
|
|
99.1
|
|
Glossary of Selected Terms
|
|
|
|
10-K
|
|
99.1
|
|
|
12/31/2012
|
|
001-11476
|
99.2
|
|
Amended Charter of the Compensation Committee effective July 24, 2014
|
|
X
|
|
8-K/A
|
|
99.1
|
|
|
07/18/2014
|
|
|
99.3
|
|
Audited Balance Sheets of Omega Refining, LLC as of December 31, 2013 and 2012, Audited Statements of Operations and Member’s Equity for the years ended December 31, 2013 and 2012, Audited Statements of Cash Flows for the years ended December 31, 2013 and 2012, and the notes thereto
|
|
|
|
8-K/A
|
|
99.2
|
|
|
07/18/2014
|
|
001-11476
|
99.4
|
|
Unaudited Balance Sheet of Omega Refining, LLC as of March 31, 2014, and the Unaudited Statements of Operations and Member’s Equity for the three months ended March 31, 2014 and 2013, and the notes thereto
|
|
|
|
8-K/A
|
|
99.2
|
|
|
07/18/2014
|
|
001-11476
|
99.5
|
|
Unaudited Pro Forma Combined Balance Sheet of Vertex Energy, Inc. as of March 31, 2014, Unaudited Pro Forma Combined Statement of Operations for the three months ended March 31, 2014, and Unaudited Pro Forma Combined Statement of Operations for the year ended December 31, 2013
|
|
|
|
8-K/A
|
|
99.3
|
|
|
07/18/2014
|
|
001-11476
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.INS++
|
|
XBRL Instance Document
|
|
X
|
|
|
|
|
|
|
|
|
|
101.SCH++
|
|
XBRL Taxonomy Extension Schema Document
|
|
X
|
|
|
|
|
|
|
|
|
|
101.CAL++
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
X
|
|
|
|
|
|
|
|
|
|
101.DEF++
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
X
|
|
|
|
|
|
|
|
|
|
101.LAB++
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
X
|
|
|
|
|
|
|
|
|
|
101.PRE++
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
X
|
|
|
|
|
|
|
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Vertex Energy, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of a Quarterly Report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 14, 2014
|
By:
|
/s/ Benjamin P. Cowart
|
|
|
Benjamin P. Cowart
Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Vertex Energy, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of a Quarterly Report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 14, 2014
|
By:
|
/s/ Chris Carlson
|
|
|
Chris Carlson
Chief Financial Officer
(Principal Accounting Officer)
|
Date: November 14, 2014
|
By:
|
/s/ Benjamin P. Cowart
|
|
|
Benjamin P. Cowart
Chief Executive Officer
(Principal Executive Officer)
|
Date: November 14, 2014
|
By:
|
/s/ Chris Carlson
|
|
|
Chris Carlson
Chief Financial Officer
(Principal Accounting Officer)
|
1.
|
Review the competitiveness of the Company's executive compensation programs to ensure (a) the attraction and retention of executives, (b) the motivation of executives to achieve the Company's business objectives, and (c) the alignment of the interests of key leadership with the long-term interests of the Company's shareholders. The Committee shall have the responsibility to determine, or to recommend to the Board for approval, the compensation of the CEO and other executive officers of the Company. Assist the Board in establishing CEO annual goals and objectives. Notwithstanding the above, the CEO may not be present during voting or deliberations on his or her compensation.
|
|
|
2.
|
Review trends in executive compensation, oversee the development of new compensation plans, and, when necessary, approve the revision of existing plans.
|
|
|
3.
|
Review and approve the compensation structure for executives.
|
|
|
4.
|
Oversee an evaluation of the performance of the Company's executive officers and approve the annual compensation, including salary, bonus, incentive and equity compensation, for the executive officers. Review and approve compensation packages for new executive officers and termination packages for executive officers.
|
|
|
5.
|
Review and make recommendations concerning long-term incentive compensation plans, including the use of equity-based plans.
|
|
|
6.
|
Periodically review the compensation paid to non-employee directors and make recommendations to the Board for any adjustments. No member of the Committee will act to fix his or her own compensation except for uniform compensation to directors for their services as a director.
|
|
|
7.
|
Review periodic reports from management on matters relating to the Company's compensation practices.
|
|
|
8.
|
Produce an annual report of the Compensation Committee on executive compensation for the Company's annual proxy statement in compliance with and to the extent required by applicable Securities and Exchange Commission rules and regulations and any relevant listing authority.
|
|
|
9.
|
Obtain or perform an annual evaluation of the Committee's performance and make applicable recommendations about, among other things, changes to the charter of the Committee.
|
|
|
10.
|
Take whatever other action that the Board shall reasonably request in its sole determination.
|