NEVADA
|
94-3439569
|
(State or other jurisdiction of
|
(I.R.S. Employer Identification No.)
|
incorporation or organization)
|
|
|
|
1331 GEMINI STREET, SUITE 250
HOUSTON, TEXAS
|
77058
|
(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbols(s)
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Name of each exchange on which registered
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Common Stock,
$0.001 Par Value Per Share
|
VTNR
|
The NASDAQ Stock Market LLC
(Nasdaq Capital Market)
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Large accelerated filer o
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Accelerated filer o
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Non-accelerated filer x
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Smaller reporting company x
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Emerging growth ¨
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|
Part I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Part II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Part III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Part IV
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Item 15.
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Item 16.
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•
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risks associated with our outstanding credit facilities, including amounts owed, restrictive covenants, security interests thereon and our ability to repay such facilities and amounts due thereon when due;
|
•
|
risks associated with our outstanding preferred stock, including redemption obligations in connection therewith, restrictive covenants and our ability to redeem such securities when required pursuant to the terms of such securities and applicable law;
|
•
|
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;
|
•
|
the impact of competitive services and products;
|
•
|
our ability to integrate acquisitions;
|
•
|
our ability to complete future acquisitions;
|
•
|
our ability to maintain insurance;
|
•
|
potential future litigation, judgments and settlements;
|
•
|
rules and regulations making our operations more costly or restrictive, including IMO 2020 (defined below);
|
•
|
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;
|
•
|
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 under our debt facilities and previously been waived;
|
•
|
prohibitions on borrowing and other covenants of 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” in this Report.
|
•
|
“System For Making A Usable Hydrocarbon Product From Used Oil” (#8,613,838), which was granted on December 24, 2013.
|
•
|
“Method for Making a Usable Hydrocarbon Product From Used Oil” (#8,398,847), which was granted on March 19, 2013.
|
•
|
“System for producing an American Petroleum Institute Standards Group III Base Stock from vacuum gas oil” (#10,421,916), which was granted on September 24, 2019.
|
•
|
“Method for producing an American petroleum institute standards group III base stock from vacuum gas oil” (#10,287,515), which was granted on May 14, 2019.
|
•
|
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;
|
•
|
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.
|
•
|
incur or guarantee additional indebtedness;
|
•
|
create liens;
|
•
|
make payments to junior creditors;
|
•
|
make investments;
|
•
|
sell material assets;
|
•
|
affect fundamental changes in our structure;
|
•
|
make certain acquisitions;
|
•
|
sell interests in our subsidiaries;
|
•
|
consolidate or merge with or into other companies or transfer all or substantially all of our assets;
|
•
|
redeem or repurchase shares of our stock, including our outstanding Series B and B1 Preferred Stock; and
|
•
|
engage in transactions with affiliates.
|
•
|
a material decrease in the supply or price of crude oil or petroleum related products in which we deal;
|
•
|
a material decrease in demand for the finished products in the markets we serve;
|
•
|
scheduled refinery turnarounds or unscheduled maintenance; and
|
•
|
operational problems or catastrophic events at any of our facilities,
|
•
|
the failure to successfully integrate the acquired businesses or facilities or new technology into our operations;
|
•
|
incurring significantly higher than anticipated capital expenditures and operating expenses;
|
•
|
disrupting our ongoing business;
|
•
|
dissipating our management resources;
|
•
|
failing to maintain uniform standards, controls and policies;
|
•
|
the inability to maintain key pre-acquisition business relationships;
|
•
|
loss of key personnel of the acquired business or facility;
|
•
|
exposure to unanticipated liabilities; and
|
•
|
the failure to realize efficiencies, synergies and cost savings.
|
•
|
regulate the collection, transportation, handling, processing and disposal of hazardous and non-hazardous wastes;
|
•
|
impose liability on persons involved in generating, handling, processing, transporting or disposing hazardous materials;
|
•
|
impose joint and several liability for remediation and clean-up of environmental contamination; and
|
•
|
require financial assurance that funds will be available for the closure and post-closure care of sites where hazardous wastes are stored, processed or disposed.
|
•
|
actual or anticipated variations in our results of operations;
|
•
|
our ability or inability to generate revenues;
|
•
|
the number of shares in our public float;
|
•
|
increased competition; and
|
•
|
conditions and trends in the market for oil refining and re-refining services, transportation services and oil feedstock.
|
•
|
The affirmative vote or written consent of the holders of a majority of the then-outstanding shares of Series A Preferred;
|
•
|
If the closing market price of our common stock averages at least $15.00 per share over a period of 20 consecutive trading days and the daily trading volume averages at least 7,500 shares over such period;
|
•
|
If we consummate an underwritten public offering of our securities at a price per share not less than $10.00 and for a total gross offering amount of at least $10 million; or
|
•
|
If a sale of the Company occurs resulting in proceeds to the holders of Series A Preferred of a per share amount of at least $10.00.
|
Measurement Period
|
Consolidated Adjusted EBITDA
|
For the six months ending December 31, 2016
|
Negative $1,000,000
|
For the three months ending March 31, 2017
|
$1,000,000
|
For the six months ending June 30, 2017
|
$3,500,000
|
For the nine months ending September 30, 2017
|
$5,500,000
|
For the twelve months ending December 31, 2017
|
$7,500,000
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
163,365,565
|
|
|
$
|
180,720,661
|
|
|
$
|
145,499,092
|
|
|
$
|
98,078,914
|
|
|
$
|
146,942,461
|
|
Income (loss) from operations
|
$
|
(2,774,044
|
)
|
|
$
|
488,348
|
|
|
$
|
(7,056,263
|
)
|
|
$
|
(10,112,514
|
)
|
|
$
|
(14,093,041
|
)
|
Basic net loss per share
|
$
|
(0.28
|
)
|
|
$
|
(0.23
|
)
|
|
$
|
(0.36
|
)
|
|
$
|
(0.51
|
)
|
|
$
|
(0.86
|
)
|
Diluted net loss per share
|
$
|
(0.28
|
)
|
|
$
|
(0.23
|
)
|
|
$
|
(0.36
|
)
|
|
$
|
(0.51
|
)
|
|
$
|
(0.86
|
)
|
Weighted average number of basic common shares outstanding
|
40,988,946
|
|
|
35,411,264
|
|
|
32,653,402
|
|
|
30,520,820
|
|
|
28,181,096
|
|
|||||
Weighted average number of diluted common shares outstanding
|
40,988,946
|
|
|
35,411,264
|
|
|
32,653,402
|
|
|
30,520,820
|
|
|
28,181,096
|
|
|
As of December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Consolidated Balance Sheet Data
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
4,099,655
|
|
|
$
|
1,249,831
|
|
|
$
|
1,105,787
|
|
|
$
|
1,701,435
|
|
|
$
|
765,364
|
|
Working capital (deficit)
|
$
|
2,609,609
|
|
|
$
|
6,547,301
|
|
|
$
|
3,523,548
|
|
|
$
|
(1,268,192
|
)
|
|
$
|
(10,498,637
|
)
|
Total assets
|
$
|
120,759,919
|
|
|
$
|
84,160,408
|
|
|
$
|
84,305,474
|
|
|
$
|
86,985,968
|
|
|
$
|
93,644,816
|
|
Long-term obligations
|
$
|
44,714,247
|
|
|
$
|
16,175,790
|
|
|
$
|
16,013,267
|
|
|
$
|
6,214,103
|
|
|
$
|
7,088,263
|
|
Total liabilities
|
$
|
69,511,546
|
|
|
$
|
33,171,401
|
|
|
$
|
32,961,171
|
|
|
$
|
28,667,747
|
|
|
$
|
40,753,674
|
|
Total temporary equity
|
$
|
28,146,347
|
|
|
$
|
22,179,963
|
|
|
$
|
22,959,945
|
|
|
$
|
19,604,255
|
|
|
$
|
11,955,207
|
|
Total equity
|
$
|
23,102,026
|
|
|
$
|
28,809,044
|
|
|
$
|
28,384,358
|
|
|
$
|
38,713,966
|
|
|
$
|
40,935,935
|
|
•
|
Expand Feedstock Supply Volume. We intend to expand our feedstock supply volume by growing our collection and aggregation operations. We plan to increase the volume of feedstock we collect directly by developing new relationships with generators and working to displace incumbent collectors; increasing the number of collection personnel, vehicles, equipment, and geographical areas we serve; and acquiring collectors in new or existing territories. We intend to increase the volume of feedstock we aggregate from third-party collectors by expanding our existing relationships and developing new vendor relationships. We believe that our ability to acquire large feedstock volumes will help to cultivate new vendor relationships because collectors often prefer to work with a single, reliable customer rather than manage multiple relationships and the uncertainty of excess inventory.
|
•
|
Broaden Existing Customer Relationships and Secure New Large Accounts. We intend to broaden our existing customer relationships by increasing sales of used motor oil and re-refined products to these accounts. In some cases, we may also seek to serve as our customers’ primary or exclusive supplier. We also believe that as we increase our supply of feedstock and re-refined products that we will secure larger customer accounts that require a partner who can consistently deliver high volumes.
|
•
|
Re-Refine Higher Value End Products. We intend to develop, lease, or acquire technologies to re-refine our feedstock supply into higher-value end products. We believe that the expansion of our facilities and our technology, and investments in additional technologies, will enable us to upgrade feedstock into end products, such as lubricating base oil, that command higher market prices than the current re-refined products we produce.
|
•
|
Pursue Selective Strategic Relationships or Acquisitions. We plan to grow market share by consolidating feedstock supply through partnering with or acquiring collection and aggregation assets. Such acquisitions and/or partnerships could increase our revenue and provide better control over the quality and quantity of feedstock available for resale and/or upgrading as well as providing additional locations for the implementation of TCEP, if we deem such commercially reasonable. In addition, we intend to pursue further vertical integration opportunities by acquiring complementary recycling and processing technologies where we can realize synergies by leveraging our customer and vendor relationships, infrastructure, and personnel, and by eliminating duplicative overhead costs.
|
|
Three Months Ended December 31,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Revenues
|
$
|
42,588,302
|
|
|
$
|
41,801,748
|
|
|
$
|
786,554
|
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|||||||
Cost of revenues
|
31,045,027
|
|
|
36,879,263
|
|
|
(5,834,236
|
)
|
|
(16
|
)%
|
|||
|
|
|
|
|
|
|
|
|||||||
Gross profit
|
11,543,275
|
|
|
4,922,485
|
|
|
6,620,790
|
|
|
135
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative expenses
|
6,652,623
|
|
|
5,258,572
|
|
|
1,394,051
|
|
|
27
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Depreciation and amortization
|
1,846,604
|
|
|
1,756,996
|
|
|
89,608
|
|
|
5
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Total operating expenses
|
8,499,227
|
|
|
7,015,568
|
|
|
1,483,659
|
|
|
21
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Income (loss) from operations
|
3,044,048
|
|
|
(2,093,083
|
)
|
|
5,137,131
|
|
|
245
|
%
|
|||
|
|
|
|
|
|
|
|
|
||||||
Other Income
|
126
|
|
|
—
|
|
|
126
|
|
|
100
|
%
|
|||
Loss on sale of assets
|
(105,554
|
)
|
|
(5,970
|
)
|
|
(99,584
|
)
|
|
(1,668
|
)%
|
|||
Gain (loss) on change in derivative warrant liability
|
(819,239
|
)
|
|
2,888,687
|
|
|
(3,707,926
|
)
|
|
(128
|
)%
|
|||
Interest Expense
|
(747,291
|
)
|
|
(833,084
|
)
|
|
85,793
|
|
|
10
|
%
|
|||
Total other income (expense)
|
(1,671,958
|
)
|
|
2,049,633
|
|
|
(3,721,591
|
)
|
|
(182
|
)%
|
|||
|
|
|
|
|
|
|
|
|
||||||
Income (loss) before income tax
|
1,372,090
|
|
|
(43,450
|
)
|
|
1,415,540
|
|
|
3,258
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Income tax provision
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Net income (loss) attributable to non-controlling interest and redeemable non-controlling interest
|
(62,112
|
)
|
|
157,883
|
|
|
(219,995
|
)
|
|
(139
|
)%
|
|||
|
|
|
|
|
|
|
|
|||||||
Net income (loss) attributable to Vertex Energy, Inc.
|
$
|
1,434,202
|
|
|
$
|
(201,333
|
)
|
|
$
|
1,635,535
|
|
|
812
|
%
|
|
Three Months Ended December 31,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Black Oil
|
|
|
|
|
|
|
|
|||||||
Revenues
|
$
|
36,215,635
|
|
|
$
|
32,730,540
|
|
|
$
|
3,485,095
|
|
|
11
|
%
|
Cost of Revenues
|
24,822,137
|
|
|
27,280,433
|
|
|
(2,458,296
|
)
|
|
(9
|
)%
|
|||
Gross profit
|
$
|
11,393,498
|
|
|
$
|
5,450,107
|
|
|
$
|
5,943,391
|
|
|
109
|
%
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
Three Months Ended December 31,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Refining And Marketing
|
|
|
|
|
|
|
|
|||||||
Revenues
|
$
|
3,745,290
|
|
|
$
|
5,553,741
|
|
|
$
|
(1,808,451
|
)
|
|
(33
|
)%
|
Cost of Revenues
|
2,883,187
|
|
|
5,972,018
|
|
|
(3,088,831
|
)
|
|
(52
|
)%
|
|||
Gross profit (deficit)
|
$
|
862,103
|
|
|
$
|
(418,277
|
)
|
|
$
|
1,280,380
|
|
|
(306
|
)%
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
Three Months Ended December 31,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Recovery
|
|
|
|
|
|
|
|
|||||||
Revenues
|
$
|
2,627,377
|
|
|
$
|
3,517,467
|
|
|
$
|
(890,090
|
)
|
|
(25
|
)%
|
Cost of Revenues
|
3,339,703
|
|
|
3,626,812
|
|
|
(287,109
|
)
|
|
(8
|
)%
|
|||
Gross deficit
|
$
|
(712,326
|
)
|
|
$
|
(109,345
|
)
|
|
$
|
(602,981
|
)
|
|
(551
|
)%
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Revenues
|
$
|
163,365,565
|
|
|
$
|
180,720,661
|
|
|
$
|
(17,355,096
|
)
|
|
(10
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Cost of revenues
|
134,777,113
|
|
|
151,314,039
|
|
|
(16,536,926
|
)
|
|
(11
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Gross profit
|
28,588,452
|
|
|
29,406,622
|
|
|
(818,170
|
)
|
|
(3
|
)%
|
|||
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative expenses
|
24,182,407
|
|
|
21,927,264
|
|
|
2,255,143
|
|
|
10
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
7,180,089
|
|
|
6,991,010
|
|
|
189,079
|
|
|
3
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Total operating expenses
|
31,362,496
|
|
|
28,918,274
|
|
|
2,444,222
|
|
|
8
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Income (loss) from operations
|
(2,774,044
|
)
|
|
488,348
|
|
|
(3,262,392
|
)
|
|
(668
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|||
Other income
|
920,197
|
|
|
659
|
|
|
919,538
|
|
|
139,535
|
%
|
|||
Gain (loss) on sale of assets
|
(74,111
|
)
|
|
45,553
|
|
|
(119,664
|
)
|
|
(263
|
)%
|
|||
Gain (loss) on change in value of derivative warrant liability
|
(487,524
|
)
|
|
763,716
|
|
|
(1,251,240
|
)
|
|
(164
|
)%
|
|||
Interest expense
|
(3,070,071
|
)
|
|
(3,281,855
|
)
|
|
211,784
|
|
|
6
|
%
|
|||
Total other expense
|
(2,711,509
|
)
|
|
(2,471,927
|
)
|
|
(239,582
|
)
|
|
(10
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Loss before income tax
|
(5,485,553
|
)
|
|
(1,983,579
|
)
|
|
(3,501,974
|
)
|
|
(177
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Income tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Net loss
|
(5,485,553
|
)
|
|
(1,983,579
|
)
|
|
(3,501,974
|
)
|
|
(177
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Net income (loss) attributable to non-controlling interest and redeemable non-controlling interest
|
(436,974
|
)
|
|
234,188
|
|
|
(671,162
|
)
|
|
(287
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||
Net loss attributable to Vertex Energy, Inc.
|
$
|
(5,048,579
|
)
|
|
$
|
(2,217,767
|
)
|
|
$
|
(2,830,812
|
)
|
|
(128
|
)%
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|||||||
Black Oil
|
|
|
|
|
|
|
|
|||||||
Revenues
|
$
|
139,269,164
|
|
|
$
|
143,836,981
|
|
|
$
|
(4,567,817
|
)
|
|
(3
|
)%
|
Cost of revenues
|
113,196,583
|
|
|
116,524,465
|
|
|
(3,327,882
|
)
|
|
(3
|
)%
|
|||
Gross profit
|
$
|
26,072,581
|
|
|
$
|
27,312,516
|
|
|
$
|
(1,239,935
|
)
|
|
(5
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Refining And Marketing
|
|
|
|
|
|
|
|
|||||||
Revenues
|
$
|
12,957,767
|
|
|
$
|
22,935,482
|
|
|
$
|
(9,977,715
|
)
|
|
(44
|
)%
|
Cost of revenues
|
10,651,069
|
|
|
22,290,277
|
|
|
(11,639,208
|
)
|
|
(52
|
)%
|
|||
Gross profit
|
$
|
2,306,698
|
|
|
$
|
645,205
|
|
|
$
|
1,661,493
|
|
|
258
|
%
|
|
|
|
|
|
|
|
|
|||||||
Recovery
|
|
|
|
|
|
|
|
|||||||
Revenues
|
$
|
11,138,634
|
|
|
$
|
13,948,198
|
|
|
$
|
(2,809,564
|
)
|
|
(20
|
)%
|
Cost of revenues
|
10,929,461
|
|
|
12,499,297
|
|
|
(1,569,836
|
)
|
|
(13
|
)%
|
|||
Gross profit
|
$
|
209,173
|
|
|
$
|
1,448,901
|
|
|
$
|
(1,239,728
|
)
|
|
(86
|
)%
|
2018
|
|
|
|
|
|
|
|
|
||||
Benchmark
|
|
High
|
|
Date
|
|
Low
|
|
Date
|
||||
U.S. Gulfcoast No. 2 Waterborne (dollars per gallon)
|
|
$
|
2.32
|
|
|
October 1
|
|
$
|
1.50
|
|
|
December 28
|
U.S. Gulfcoast Unleaded 87 Waterborne (dollars per gallon)
|
|
$
|
2.20
|
|
|
October 3
|
|
$
|
1.26
|
|
|
December 27
|
U.S. Gulfcoast Residual Fuel No. 6 3% (dollars per barrel)
|
|
$
|
73.42
|
|
|
October 9
|
|
$
|
47.27
|
|
|
December 27
|
NYMEX Crude Oil (dollars per barrel)
|
|
$
|
76.41
|
|
|
October 1
|
|
$
|
44.61
|
|
|
December 27
|
Reported in Platt's US Marketscan (Gulf Coast)
|
|
Statements of Operations by Quarter
|
|
|
||||||||||||||||||||||||||||
|
Fiscal 2019
|
|
Fiscal 2018
|
||||||||||||||||||||||||||||
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
||||||||||||||||
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
||||||||||||||||
Revenues
|
$
|
42,588,302
|
|
|
$
|
37,799,259
|
|
|
$
|
43,657,292
|
|
|
$
|
39,320,712
|
|
|
$
|
41,801,748
|
|
|
$
|
50,632,948
|
|
|
$
|
46,917,770
|
|
|
$
|
41,368,195
|
|
Cost of revenues
|
31,045,027
|
|
|
32,372,316
|
|
|
36,515,421
|
|
|
34,844,349
|
|
|
36,879,263
|
|
|
42,593,367
|
|
|
36,796,258
|
|
|
35,045,151
|
|
||||||||
Gross profit
|
11,543,275
|
|
|
5,426,943
|
|
|
7,141,871
|
|
|
4,476,363
|
|
|
4,922,485
|
|
|
8,039,581
|
|
|
10,121,512
|
|
|
6,323,044
|
|
||||||||
Selling, general and administrative expenses
|
6,652,623
|
|
|
6,153,184
|
|
|
6,028,859
|
|
|
5,347,741
|
|
|
5,258,572
|
|
|
5,658,659
|
|
|
5,364,591
|
|
|
5,645,442
|
|
||||||||
Depreciation and amortization
|
1,846,604
|
|
|
1,815,582
|
|
|
1,780,890
|
|
|
1,737,013
|
|
|
1,756,996
|
|
|
1,806,839
|
|
|
1,733,076
|
|
|
1,694,099
|
|
||||||||
Total operating expenses
|
8,499,227
|
|
|
7,968,766
|
|
|
7,809,749
|
|
|
7,084,754
|
|
|
7,015,568
|
|
|
7,465,498
|
|
|
7,097,667
|
|
|
7,339,541
|
|
||||||||
Income (loss) from operations
|
3,044,048
|
|
|
(2,541,823
|
)
|
|
(667,878
|
)
|
|
(2,608,391
|
)
|
|
(2,093,083
|
)
|
|
574,083
|
|
|
3,023,845
|
|
|
(1,016,497
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest income
|
126
|
|
|
918,153
|
|
|
1,918
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
659
|
|
|
—
|
|
||||||||
Gain(loss) Asset Sales
|
(105,554
|
)
|
|
—
|
|
|
29,150
|
|
|
2,293
|
|
|
(5,970
|
)
|
|
—
|
|
|
8,843
|
|
|
42,680
|
|
||||||||
Gain on change in value of derivative liability
|
(819,239
|
)
|
|
1,290,792
|
|
|
746,017
|
|
|
(1,705,094
|
)
|
|
2,888,687
|
|
|
(2,169,133
|
)
|
|
475,913
|
|
|
(431,751
|
)
|
||||||||
Interest expense
|
(747,291
|
)
|
|
(826,005
|
)
|
|
(738,972
|
)
|
|
(757,803
|
)
|
|
(833,084
|
)
|
|
(798,800
|
)
|
|
(847,456
|
)
|
|
(802,515
|
)
|
||||||||
Total other income (expense)
|
(1,671,958
|
)
|
|
1,382,940
|
|
|
38,113
|
|
|
(2,460,604
|
)
|
|
2,049,633
|
|
|
(2,967,933
|
)
|
|
(362,041
|
)
|
|
(1,191,586
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Income (loss) before income taxes
|
1,372,090
|
|
|
(1,158,883
|
)
|
|
(629,765
|
)
|
|
(5,068,995
|
)
|
|
(43,450
|
)
|
|
(2,393,850
|
)
|
|
2,661,804
|
|
|
(2,208,083
|
)
|
||||||||
Income tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net income (loss)
|
1,372,090
|
|
|
(1,158,883
|
)
|
|
(629,765
|
)
|
|
(5,068,995
|
)
|
|
(43,450
|
)
|
|
(2,393,850
|
)
|
|
2,661,804
|
|
|
(2,208,083
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss)attributable to non-controlling interest
|
(62,112
|
)
|
|
(67,102
|
)
|
|
(202,329
|
)
|
|
(105,431
|
)
|
|
157,883
|
|
|
(105,970
|
)
|
|
131,736
|
|
|
50,539
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income (loss)attributable to Vertex Energy, Inc.
|
$
|
1,434,202
|
|
|
$
|
(1,091,781
|
)
|
|
$
|
(427,436
|
)
|
|
$
|
(4,963,564
|
)
|
|
$
|
(201,333
|
)
|
|
$
|
(2,287,880
|
)
|
|
$
|
2,530,068
|
|
|
$
|
(2,258,622
|
)
|
Number of weighted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
42,063,871
|
|
|
41,376,335
|
|
|
40,294,870
|
|
|
40,195,925
|
|
|
40,062,779
|
|
|
35,144,113
|
|
|
33,300,456
|
|
|
33,063,732
|
|
||||||||
Diluted
|
42,783,248
|
|
|
41,376,335
|
|
|
40,294,870
|
|
|
40,195,925
|
|
|
40,062,779
|
|
|
35,144,113
|
|
|
37,013,651
|
|
|
33,063,732
|
|
|
Statements of Operations by Quarters
|
|
|
||||||||||||||||||||||||||||
|
Fiscal 2019
|
|
Fiscal 2018
|
||||||||||||||||||||||||||||
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
||||||||||||||||
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
|
Quarter
|
||||||||||||||||
Black Oil
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Revenues
|
$
|
36,215,635
|
|
|
$
|
32,330,530
|
|
|
$
|
37,907,811
|
|
|
$
|
32,815,187
|
|
|
$
|
32,730,540
|
|
|
$
|
40,400,064
|
|
|
$
|
38,469,131
|
|
|
$
|
32,237,246
|
|
Cost of revenues
|
24,822,137
|
|
|
27,663,982
|
|
|
31,368,939
|
|
|
29,341,525
|
|
|
27,280,433
|
|
|
32,550,126
|
|
|
29,723,927
|
|
|
26,969,978
|
|
||||||||
Gross profit
|
$
|
11,393,498
|
|
|
$
|
4,666,548
|
|
|
$
|
6,538,872
|
|
|
$
|
3,473,662
|
|
|
$
|
5,450,107
|
|
|
$
|
7,849,938
|
|
|
$
|
8,745,204
|
|
|
$
|
5,267,268
|
|
Refining & Marketing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Revenues
|
$
|
3,745,290
|
|
|
$
|
3,076,454
|
|
|
$
|
3,277,402
|
|
|
$
|
2,858,621
|
|
|
$
|
5,553,741
|
|
|
$
|
7,313,630
|
|
|
$
|
4,392,870
|
|
|
$
|
5,675,241
|
|
Cost of revenues
|
2,883,187
|
|
|
2,511,314
|
|
|
2,705,031
|
|
|
2,551,537
|
|
|
5,972,018
|
|
|
7,044,218
|
|
|
4,034,509
|
|
|
5,239,532
|
|
||||||||
Gross profit (loss)
|
$
|
862,103
|
|
|
$
|
565,140
|
|
|
$
|
572,371
|
|
|
$
|
307,084
|
|
|
$
|
(418,277
|
)
|
|
$
|
269,412
|
|
|
$
|
358,361
|
|
|
$
|
435,709
|
|
Recovery
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Revenues
|
$
|
2,627,377
|
|
|
$
|
2,392,274
|
|
|
$
|
2,472,079
|
|
|
$
|
3,646,904
|
|
|
$
|
3,517,467
|
|
|
$
|
2,919,254
|
|
|
$
|
4,055,769
|
|
|
$
|
3,455,708
|
|
Cost of revenues
|
3,339,703
|
|
|
2,197,019
|
|
|
2,441,451
|
|
|
2,951,287
|
|
|
3,626,812
|
|
|
2,999,023
|
|
|
3,037,821
|
|
|
2,835,641
|
|
||||||||
Gross profit (loss)
|
$
|
(712,326
|
)
|
|
$
|
195,255
|
|
|
$
|
30,628
|
|
|
$
|
695,617
|
|
|
$
|
(109,345
|
)
|
|
$
|
(79,769
|
)
|
|
$
|
1,017,948
|
|
|
$
|
620,067
|
|
|
Twelve Months Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Beginning cash, cash equivalents, and restricted cash
|
$
|
2,849,831
|
|
|
$
|
1,105,787
|
|
Net cash provided by (used in):
|
|
|
|
||||
Operating activities
|
2,473,167
|
|
|
5,376,287
|
|
||
Investing activities
|
(3,626,440
|
)
|
|
(2,768,943
|
)
|
||
Financing activities
|
2,503,267
|
|
|
(863,300
|
)
|
||
Net increase in cash, cash equivalents, and restricted cash
|
1,349,994
|
|
|
1,744,044
|
|
||
Ending cash, cash equivalents, and restricted cash
|
$
|
4,199,825
|
|
|
$
|
2,849,831
|
|
Creditor
|
|
Loan Type
|
|
Origination Date
|
|
Maturity Date
|
|
Loan Amount
|
|
December 31, 2019
|
December 31, 2018
|
||||||
Encina Business Credit, LLC
|
|
Term Loan
|
|
February 1, 2017
|
|
February 1, 2021
|
|
$
|
20,000,000
|
|
|
$
|
13,333,000
|
|
$
|
15,350,000
|
|
Encina Business Credit SPV, LLC
|
|
Revolving Note
|
|
February 1, 2017
|
|
February 1, 2021
|
|
$
|
10,000,000
|
|
|
3,276,230
|
|
3,844,636
|
|
||
Tetra Capital Lease
|
|
Finance Lease
|
|
May, 2018
|
|
May, 2022
|
|
$
|
419,690
|
|
|
264,014
|
|
349,822
|
|
||
Wells Fargo Equipment Lease-VRM LA
|
|
Finance Lease
|
|
March, 2018
|
|
March, 2021
|
|
$
|
30,408
|
|
|
12,341
|
|
22,390
|
|
||
Wells Fargo Equipment Lease-Ohio
|
|
Finance Lease
|
|
April-May, 2019
|
|
April-May, 2024
|
|
$
|
621,000
|
|
|
551,260
|
|
—
|
|
||
Various institutions
|
|
Insurance premiums financed
|
|
Various
|
|
< 1 year
|
|
$
|
2,902,428
|
|
|
1,165,172
|
|
999,152
|
|
||
Total
|
|
|
|
|
|
|
|
|
|
18,602,017
|
|
20,566,000
|
|
||||
Deferred finance costs
|
|
|
|
|
|
|
|
|
|
(47,826
|
)
|
(621,733
|
)
|
||||
Total, net of deferred finance costs
|
|
|
|
|
|
|
|
|
|
$
|
18,554,191
|
|
$
|
19,944,267
|
|
Creditor
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
||||||||||||
Encina Business Credit, LLC
|
|
$
|
900,000
|
|
|
$
|
12,433,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Encina Business Credit SPV, LLC
|
|
3,276,230
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tetra Capital Lease
|
|
91,779
|
|
|
98,167
|
|
|
74,068
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Wells Fargo Equipment Lease-VRM LA
|
|
10,537
|
|
|
1,804
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Wells Fargo Equipment Lease-Ohio
|
|
114,848
|
|
|
120,895
|
|
|
127,264
|
|
|
138,476
|
|
|
49,777
|
|
|
—
|
|
||||||
Various institutions
|
|
1,165,172
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Totals
|
|
5,558,566
|
|
|
12,653,866
|
|
|
201,332
|
|
|
138,476
|
|
|
49,777
|
|
|
—
|
|
||||||
Deferred finance costs
|
|
(47,826
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Totals, net of deferred finance costs
|
|
$
|
5,510,740
|
|
|
$
|
12,653,866
|
|
|
$
|
201,332
|
|
|
$
|
138,476
|
|
|
$
|
49,777
|
|
|
$
|
—
|
|
•
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
•
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
•
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
Page
|
Consolidated Financial Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VERTEX ENERGY, INC.
|
|||||||
CONSOLIDATED BALANCE SHEETS
|
|||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
4,099,655
|
|
|
$
|
1,249,831
|
|
Restricted cash
|
100,170
|
|
|
1,600,000
|
|
||
Accounts receivable, net
|
12,138,078
|
|
|
9,027,990
|
|
||
Federal income tax receivable
|
68,606
|
|
|
137,212
|
|
||
Inventory
|
6,547,479
|
|
|
8,091,397
|
|
||
Derivative commodity asset
|
—
|
|
|
695,941
|
|
||
Prepaid expenses and other current assets
|
4,452,920
|
|
|
2,740,541
|
|
||
Total current assets
|
27,406,908
|
|
|
23,542,912
|
|
||
|
|
|
|
||||
|
|
|
|
||||
Fixed assets, at cost
|
69,469,548
|
|
|
66,762,388
|
|
||
Less accumulated depreciation
|
(24,708,151
|
)
|
|
(19,874,896
|
)
|
||
Fixed assets, net
|
44,761,397
|
|
|
46,887,492
|
|
||
Finance lease right-of-use assets
|
851,570
|
|
|
397,515
|
|
||
Operating lease right-of-use assets
|
35,586,885
|
|
|
—
|
|
||
Intangible assets, net
|
11,243,800
|
|
|
12,578,519
|
|
||
Deferred income taxes
|
68,605
|
|
|
137,211
|
|
||
Other assets
|
840,754
|
|
|
616,759
|
|
||
TOTAL ASSETS
|
$
|
120,759,919
|
|
|
$
|
84,160,408
|
|
|
|
|
|
VERTEX ENERGY, INC.
|
|||||||
CONSOLIDATED BALANCE SHEETS
|
|||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
LIABILITIES, TEMPORARY EQUITY AND EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
7,620,098
|
|
|
$
|
8,791,529
|
|
Accrued expenses
|
5,016,132
|
|
|
2,535,347
|
|
||
Dividends payable
|
389,176
|
|
|
403,002
|
|
||
Finance lease-current
|
217,164
|
|
|
95,857
|
|
||
Operating lease-current
|
5,885,304
|
|
|
—
|
|
||
Current portion of long-term debt, net of unamortized finance costs
|
2,017,345
|
|
|
1,325,240
|
|
||
Revolving note
|
3,276,230
|
|
|
3,844,636
|
|
||
Derivative commodity liability
|
375,850
|
|
|
—
|
|
||
Total current liabilities
|
24,797,299
|
|
|
16,995,611
|
|
||
|
|
|
|
|
|
||
Long-term debt, net of unamortized finance costs
|
12,433,000
|
|
|
14,402,179
|
|
||
Finance lease-long-term
|
610,450
|
|
|
276,355
|
|
||
Operating lease-long-term
|
29,701,581
|
|
|
—
|
|
||
Contingent consideration
|
—
|
|
|
15,564
|
|
||
Derivative warrant liability
|
1,969,216
|
|
|
1,481,692
|
|
||
Total liabilities
|
69,511,546
|
|
|
33,171,401
|
|
||
|
|
|
|
||||
COMMITMENTS AND CONTINGENCIES (Note 4)
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
TEMPORARY EQUITY
|
|
|
|
||||
Series B Preferred Stock, $0.001 par value per share;
10,000,000 shares authorized, 3,826,055 and 3,604,827 shares issued and outstanding at December 31, 2019 and 2018, respectively with liquidation preference of $11,860,771 and $11,174,964 at December 31, 2019 and 2018, respectively. |
11,006,406
|
|
|
8,900,208
|
|
||
|
|
|
|
||||
Series B1 Preferred Stock, $0.001 par value per share;
17,000,000 shares authorized, 9,028,085 and 10,057,597 shares issued and outstanding at December 31, 2019 and 2018, respectively with liquidation preference of $14,083,813 and $15,689,851 at December 31, 2019 and 2018, respectively. |
12,743,047
|
|
|
13,279,755
|
|
||
|
|
|
|
||||
Redeemable non-controlling interest
|
4,396,894
|
|
|
—
|
|
||
Total Temporary Equity
|
28,146,347
|
|
|
22,179,963
|
|
VERTEX ENERGY, INC.
|
|||||||
CONSOLIDATED BALANCE SHEETS
|
|||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
EQUITY
|
|
|
|
||||
Series A Convertible Preferred stock, $0.001 par value;
5,000,000 shares authorized and 419,859 and 419,859 shares issued and outstanding at December 31, 2019 and 2018, respectively, with a liquidation preference of $625,590 and $625,590 at December 31, 2019 and December 31, 2018, respectively. |
420
|
|
|
420
|
|
||
|
|
|
|
||||
Series C Convertible Preferred stock, $0.001 par value per share;
44,000 shares designated; zero and zero issued and outstanding at December 31, 2019 and 2018, respectively with a liquidation preference of zero and zero at December 31, 2019 and December 31, 2018, respectively. |
—
|
|
|
—
|
|
||
|
|
|
|
||||
Common stock, $0.001 par value per share;
750,000,000 shares authorized; 43,395,563 and 40,174,821 issued and outstanding at December 31, 2019 and 2018, respectively. |
43,396
|
|
|
40,175
|
|
||
Additional paid-in capital
|
81,527,351
|
|
|
75,131,122
|
|
||
Accumulated deficit
|
(59,246,514
|
)
|
|
(47,800,886
|
)
|
||
Total Vertex Energy, Inc. stockholders' equity
|
22,324,653
|
|
|
27,370,831
|
|
||
Non-controlling interest
|
777,373
|
|
|
1,438,213
|
|
||
Total Equity
|
23,102,026
|
|
|
28,809,044
|
|
||
TOTAL LIABILITIES, TEMPORARY EQUITY AND EQUITY
|
$
|
120,759,919
|
|
|
$
|
84,160,408
|
|
VERTEX ENERGY, INC.
|
|||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||
FOR THE YEARS ENDED DECEMBER 31, 2019 and 2018
|
|||||||
|
2019
|
|
2018
|
||||
Revenues
|
$
|
163,365,565
|
|
|
$
|
180,720,661
|
|
Cost of revenues (exclusive of depreciation and amortization shown separately below)
|
134,777,113
|
|
|
151,314,039
|
|
||
Gross profit
|
28,588,452
|
|
|
29,406,622
|
|
||
|
|
|
|
||||
Operating expenses:
|
|
|
|
||||
Selling, general and administrative expenses
|
24,182,407
|
|
|
21,927,264
|
|
||
Depreciation and amortization
|
7,180,089
|
|
|
6,991,010
|
|
||
Total operating expenses
|
31,362,496
|
|
|
28,918,274
|
|
||
Income (loss) from operations
|
(2,774,044
|
)
|
|
488,348
|
|
||
Other income (expense):
|
|
|
|
||||
Other income
|
920,197
|
|
|
659
|
|
||
Gain (loss) on sale of assets
|
(74,111
|
)
|
|
45,553
|
|
||
Gain (loss) on change in value of derivative warrant liability
|
(487,524
|
)
|
|
763,716
|
|
||
Interest expense
|
(3,070,071
|
)
|
|
(3,281,855
|
)
|
||
Total other expense
|
(2,711,509
|
)
|
|
(2,471,927
|
)
|
||
Loss before income taxes
|
(5,485,553
|
)
|
|
(1,983,579
|
)
|
||
Income tax benefit
|
—
|
|
|
—
|
|
||
Net loss
|
(5,485,553
|
)
|
|
(1,983,579
|
)
|
||
Net income (loss) attributable to non-controlling interest and redeemable non-controlling interest
|
(436,974
|
)
|
|
234,188
|
|
||
Net loss attributable to Vertex Energy, Inc.
|
(5,048,579
|
)
|
|
(2,217,767
|
)
|
||
|
|
|
|
||||
Accretion of redeemable noncontrolling interest to redemption value
|
(2,279,371
|
)
|
|
—
|
|
||
Accretion of discount on series B and B-1 Preferred Stock
|
(2,489,722
|
)
|
|
(3,132,414
|
)
|
||
Dividends on series B and B-1 Preferred Stock
|
(1,627,956
|
)
|
|
(2,687,123
|
)
|
||
Net loss available to common stockholders
|
$
|
(11,445,628
|
)
|
|
$
|
(8,037,304
|
)
|
|
|
|
|
||||
Loss per common share
|
|
|
|
|
|
||
Basic
|
$
|
(0.28
|
)
|
|
$
|
(0.23
|
)
|
Diluted
|
$
|
(0.28
|
)
|
|
$
|
(0.23
|
)
|
Shares used in computing loss per share
|
|
|
|
|
|
||
Basic
|
40,988,946
|
|
|
35,411,264
|
|
||
Diluted
|
40,988,946
|
|
|
35,411,264
|
|
VERTEX ENERGY, INC.
|
||||||||||||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF EQUITY
|
||||||||||||||||||||||||||||||||||||
FOR THE YEARS ENDING DECEMBER 31, 2019 AND 2018
|
||||||||||||||||||||||||||||||||||||
|
Common Stock
|
|
Series A Preferred
|
|
Series C Preferred
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Non-controlling Interest
|
|
Total Equity
|
|||||||||||||||||||||||
|
Shares
|
|
$.001 Par
|
|
Shares
|
|
$.001 Par
|
|
Shares
|
|
$.001 Par
|
|
|
|
|
|||||||||||||||||||||
Balance on December 31, 2017
|
32,658,176
|
|
|
$
|
32,658
|
|
|
453,567
|
|
|
$
|
454
|
|
|
31,568
|
|
|
$
|
32
|
|
|
$
|
67,768,509
|
|
|
$
|
(39,816,300
|
)
|
|
$
|
399,005
|
|
|
$
|
28,384,358
|
|
Correction of non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52,718
|
|
|
(52,718
|
)
|
|
—
|
|
|||||||
Dividends and Series B and B1 Preferred Stock
|
166,630
|
|
|
167
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
313,097
|
|
|
(2,687,123
|
)
|
|
—
|
|
|
(2,373,859
|
)
|
|||||||
Accretion of discount on Series B and B1 Preferred Stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,960,013
|
)
|
|
—
|
|
|
(1,960,013
|
)
|
|||||||
Conversion of Series B Preferred stock to common
|
32,149
|
|
|
33
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
99,629
|
|
|
(36,700
|
)
|
|
—
|
|
|
62,962
|
|
|||||||
Share based compensation expense, total
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
659,836
|
|
|
—
|
|
|
—
|
|
|
659,836
|
|
|||||||
Exercise of options to common
|
241
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Conversion of Series A Preferred stock to common
|
33,708
|
|
|
34
|
|
|
(33,708
|
)
|
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Conversion of Series C Preferred Stock to common
|
3,156,800
|
|
|
3,157
|
|
|
—
|
|
|
—
|
|
|
(31,568
|
)
|
|
(32
|
)
|
|
(3,125
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Conversion of Series B1 Preferred stock to common
|
3,977,117
|
|
|
3,976
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,200,326
|
|
|
(1,135,701
|
)
|
|
—
|
|
|
5,068,601
|
|
|||||||
Fixed assets contributed by noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
857,738
|
|
|
857,738
|
|
|||||||
Issue of common stock from Nickco contingent consideration
|
150,000
|
|
|
150
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
92,850
|
|
|
—
|
|
|
—
|
|
|
93,000
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,217,767
|
)
|
|
234,188
|
|
|
(1,983,579
|
)
|
|||||||
Balance on December 31, 2018
|
40,174,821
|
|
|
40,175
|
|
|
419,859
|
|
|
420
|
|
|
—
|
|
|
—
|
|
|
75,131,122
|
|
|
(47,800,886
|
)
|
|
1,438,213
|
|
|
28,809,044
|
|
|||||||
Dividends on Series B and B1 Preferred Stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,627,956
|
)
|
|
—
|
|
|
(1,627,956
|
)
|
|||||||
Accretion of discount on Series B and B1 Preferred Stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,169,597
|
)
|
|
—
|
|
|
(2,169,597
|
)
|
|||||||
Conversion of B1 Preferred Stock to common
|
1,642,317
|
|
|
1,642
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,560,373
|
|
|
(320,125
|
)
|
|
—
|
|
|
2,241,890
|
|
|||||||
Share based compensation expense, total
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
642,840
|
|
|
—
|
|
|
—
|
|
|
642,840
|
|
|||||||
Exercise of options to common
|
78,425
|
|
|
79
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,996
|
|
|
—
|
|
|
—
|
|
|
7,075
|
|
|||||||
Distribution to noncontrolling
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(285,534
|
)
|
|
(285,534
|
)
|
|||||||
Adjustment of redeemable noncontrolling interest to redemption value
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,217,703
|
)
|
|
—
|
|
|
(2,217,703
|
)
|
|||||||
Adjustment of carrying amount of noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
970,809
|
|
|
—
|
|
|
—
|
|
|
970,809
|
|
|||||||
Issue of common stock and warrants
|
1,500,000
|
|
|
1,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,215,211
|
|
|
—
|
|
|
—
|
|
|
2,216,711
|
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,110,247
|
)
|
|
(375,306
|
)
|
|
(5,485,553
|
)
|
|||||||
Balance on December 31, 2019
|
43,395,563
|
|
|
$
|
43,396
|
|
|
419,859
|
|
|
$
|
420
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
81,527,351
|
|
|
$
|
(59,246,514
|
)
|
|
$
|
777,373
|
|
|
$
|
23,102,026
|
|
VERTEX ENERGY, INC.
|
|||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||
FOR THE YEARS ENDING DECEMBER 31, 2019 AND 2018
|
|||||||
|
2019
|
|
2018
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net loss
|
$
|
(5,485,553
|
)
|
|
$
|
(1,983,579
|
)
|
Adjustments to reconcile net loss to cash provided by (used in) operating activities:
|
|
|
|
|
|
||
Stock-based compensation expense
|
642,840
|
|
|
659,836
|
|
||
Depreciation and amortization
|
7,180,089
|
|
|
6,991,010
|
|
||
Reduction in allowance for bad debt
|
(320,013
|
)
|
|
(299,110
|
)
|
||
Gain on commodity derivative contracts
|
2,458,359
|
|
|
(1,062,682
|
)
|
||
Net cash settlement on commodity derivatives
|
(2,841,052
|
)
|
|
369,188
|
|
||
Gain on sale of assets
|
74,111
|
|
|
(45,553
|
)
|
||
Gain on disposition
|
—
|
|
|
(241,416
|
)
|
||
Amortization of debt discount and deferred costs
|
573,908
|
|
|
584,336
|
|
||
Deferred federal income tax
|
—
|
|
|
—
|
|
||
Decrease in fair value of derivative liability
|
487,524
|
|
|
(763,716
|
)
|
||
Reduction in contingent consideration
|
(15,564
|
)
|
|
(128,116
|
)
|
||
Impairment of goodwill
|
—
|
|
|
176,349
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(2,652,864
|
)
|
|
2,143,834
|
|
||
Inventory
|
1,543,918
|
|
|
(1,786,555
|
)
|
||
Prepaid expenses
|
(257,894
|
)
|
|
(597,146
|
)
|
||
Accounts payable
|
(1,171,433
|
)
|
|
1,493,324
|
|
||
Accrued expenses
|
2,480,786
|
|
|
42,625
|
|
||
Other assets
|
(223,995
|
)
|
|
(176,342
|
)
|
||
Net cash provided by operating activities
|
2,473,167
|
|
|
5,376,287
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
||
Internally developed software
|
(489,093
|
)
|
|
—
|
|
||
Proceeds from the sale of assets
|
232,020
|
|
|
—
|
|
||
Acquisitions
|
—
|
|
|
(269,826
|
)
|
||
Purchase of fixed assets
|
(3,369,367
|
)
|
|
(2,499,117
|
)
|
||
Net cash used in investing activities
|
(3,626,440
|
)
|
|
(2,768,943
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
|
||
Line of credit proceeds (payments), net
|
(568,406
|
)
|
|
(746,891
|
)
|
||
Proceeds received from issuance of common stock and warrants
|
2,216,711
|
|
|
—
|
|
||
Proceeds from exercise of stock options
|
7,075
|
|
|
—
|
|
||
Distribution VRM LA
|
(285,534
|
)
|
|
—
|
|
||
Contribution received from redeemable noncontrolling interest
|
3,150,000
|
|
|
—
|
|
||
Payments on finance leases
|
(165,598
|
)
|
|
(77,886
|
)
|
||
Proceeds from notes payable
|
2,809,139
|
|
|
4,024,964
|
|
||
Payments made on notes payable
|
(4,660,120
|
)
|
|
(4,063,487
|
)
|
||
Net cash provided by (used in) financing activities
|
2,503,267
|
|
|
(863,300
|
)
|
||
Net change in cash and cash equivalents and restricted cash
|
1,349,994
|
|
|
1,744,044
|
|
||
Cash and cash equivalents and restricted cash at beginning of the year
|
2,849,831
|
|
|
1,105,787
|
|
||
Cash and cash equivalents and restricted cash at end of year
|
$
|
4,199,825
|
|
|
$
|
2,849,831
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION
|
|
|
|
|
|
||
Cash paid for interest
|
$
|
2,505,852
|
|
|
$
|
2,722,542
|
|
Cash paid for income taxes
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||||
NON-CASH INVESTING AND FINANCING TRANSACTIONS
|
|
|
|
||||
Conversion of Series A Preferred Stock into common stock
|
$
|
—
|
|
|
$
|
34
|
|
Conversion of Series B and B1 Preferred Stock into common stock
|
$
|
2,560,373
|
|
|
$
|
6,613,052
|
|
Dividends on Series B and B-1 Preferred Stock
|
$
|
1,627,956
|
|
|
$
|
2,687,123
|
|
Initial adjustment of carrying amount of redeemable noncontrolling interest
|
$
|
970,809
|
|
|
$
|
—
|
|
Accretion of discount on Series B and B-1 Preferred Stock
|
$
|
2,489,722
|
|
|
$
|
3,132,414
|
|
Accretion of redeemable noncontrolling interest to redemption value
|
$
|
2,279,371
|
|
|
$
|
—
|
|
Equipment acquired under capital leases
|
$
|
621,000
|
|
|
$
|
450,098
|
|
Contributed assets Vertex Recovery Management LA from non-controlling interest
|
$
|
—
|
|
|
$
|
857,738
|
|
Common restricted shares for Nickco acquisition
|
$
|
—
|
|
|
$
|
93,000
|
|
•
|
Cedar Marine Terminals, L.P. (“CMT”) operates a 19-acre bulk liquid storage facility on the Houston Ship Channel. The terminal serves as a truck-in, barge-out facility and provides throughput terminal operations. CMT is also the site of the TCEP.
|
•
|
Crossroad Carriers, L.P. (“Crossroad”) is a common carrier that provides transportation and logistical services for liquid petroleum products, as well as other hazardous materials and product streams.
|
•
|
Vertex Recovery, L.P. (“Vertex Recovery”) is a generator solutions company for the recycling and collection of used oil and oil-related residual materials from large regional and national customers throughout the U.S. It facilitates its services through a network of independent recyclers and franchise collectors.
|
•
|
H&H Oil, L.P. (“H&H Oil”) collects and recycles used oil and residual materials from customers based in Austin, Baytown, Dallas, San Antonio and Corpus Christi, Texas.
|
•
|
Vertex Refining, LA, LLC which owned a used oil re-refinery based in Marrero, Louisiana and also has assets in Belle Chasse, Louisiana, prior to the consummation of the MG Share Purchase in July 2019, as discussed below under “Note 6. Acquisitions and Dispositions” - “Myrtle Grove Share Purchase and Subscription Agreement.
|
•
|
Vertex Refining, NV, LLC ("Vertex Refining") is a base oil marketing and distribution company with customers throughout the United States.
|
•
|
Vertex Recovery Management, LLC is currently buying and preparing ferrous and non-ferrous scrap intended for large haul barge sales.
|
•
|
Vertex Refining, OH, LLC collects and re-refines used oil and residual materials from customers throughout the Midwest. Refinery operations are based in Columbus, Ohio with collection branches located in Norwalk, Ohio, Zanesville, Ohio, Ravenswood, West Virginia, and Mt. Sterling, Kentucky. Effective January 1, 2020, the ownership of 65% of the assets of Vertex OH, LLC were transferred to Tensile in connection with the Heartland SPV (discussed below under “Note 19. Subsequent Events” - “Heartland Share Purchase and Subscription Agreement”).
|
•
|
Vertex Refining Myrtle Grove LLC (“MG SPV”), is a special purpose entity formed to hold the Belle Chasse, Louisiana, re-refining complex, which entity is 84.42% owned by Vertex Operating.
|
•
|
Vertex Energy Operating, LLC ("Vertex Operating"), is a holding company for various of the subsidiaries described above.
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Cash and cash equivalents
|
$
|
4,099,655
|
|
|
$
|
1,249,831
|
|
Restricted cash
|
100,170
|
|
|
1,600,000
|
|
||
Cash and cash equivalents and restricted cash as shown in the consolidated statements of cash flows
|
$
|
4,199,825
|
|
|
$
|
2,849,831
|
|
•
|
Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;
|
•
|
Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and
|
•
|
Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
Year ended December 31, 2019
|
||||||||||||||
|
Black Oil
|
|
Refining & Marketing
|
|
Recovery
|
|
Total
|
||||||||
Primary Geographical Markets
|
|
|
|
|
|
|
|
||||||||
Northern United States
|
$
|
42,195,020
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
42,195,020
|
|
Southern United States
|
97,074,144
|
|
|
12,957,767
|
|
|
11,138,634
|
|
|
121,170,545
|
|
||||
|
$
|
139,269,164
|
|
|
$
|
12,957,767
|
|
|
$
|
11,138,634
|
|
|
$
|
163,365,565
|
|
Sources of Revenue
|
|
|
|
|
|
|
|
||||||||
Petroleum products
|
$
|
139,269,164
|
|
|
$
|
12,957,767
|
|
|
$
|
2,666,077
|
|
|
$
|
154,893,008
|
|
Metals
|
—
|
|
|
—
|
|
|
8,472,557
|
|
|
8,472,557
|
|
||||
Total revenues
|
$
|
139,269,164
|
|
|
$
|
12,957,767
|
|
|
$
|
11,138,634
|
|
|
$
|
163,365,565
|
|
|
Year ended December 31, 2018
|
||||||||||||||
|
Black Oil
|
|
Refining & Marketing
|
|
Recovery
|
|
Total
|
||||||||
Primary Geographical Markets
|
|
|
|
|
|
|
|
||||||||
Northern United States
|
$
|
41,207,747
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
41,207,747
|
|
Southern United States
|
102,629,234
|
|
|
22,935,482
|
|
|
13,948,198
|
|
|
139,512,914
|
|
||||
|
$
|
143,836,981
|
|
|
$
|
22,935,482
|
|
|
$
|
13,948,198
|
|
|
$
|
180,720,661
|
|
Sources of Revenue
|
|
|
|
|
|
|
|
||||||||
Petroleum products
|
$
|
143,836,981
|
|
|
$
|
22,935,482
|
|
|
$
|
1,960,915
|
|
|
$
|
168,733,378
|
|
Metals
|
—
|
|
|
—
|
|
|
11,987,283
|
|
|
11,987,283
|
|
||||
Total revenues
|
$
|
143,836,981
|
|
|
$
|
22,935,482
|
|
|
$
|
13,948,198
|
|
|
$
|
180,720,661
|
|
|
2019
|
|
2018
|
||||
|
% of
Revenues
|
|
% of
Receivables
|
|
% of
Revenues |
|
% of
Receivables |
Customer 1
|
40%
|
|
36%
|
|
34%
|
|
21%
|
Customer 2
|
8%
|
|
14%
|
|
—%
|
|
—%
|
Customer 3
|
9%
|
|
—%
|
|
11%
|
|
—%
|
Customer 4
|
3%
|
|
7%
|
|
4%
|
|
13%
|
|
% of Revenue by Segment 2019
|
|
% of Revenue by Segment 2018
|
||||||||||||||
|
Black Oil
|
|
Refining
|
|
Recovery
|
|
Black Oil
|
|
Refining
|
|
Recovery
|
||||||
Customer 1
|
47
|
%
|
|
—
|
%
|
|
—
|
%
|
|
43
|
%
|
|
—
|
%
|
|
—
|
%
|
Customer 2
|
10
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Customer 3
|
10
|
%
|
|
—
|
%
|
|
—
|
%
|
|
14
|
%
|
|
—
|
%
|
|
—
|
%
|
Customer 4
|
4
|
%
|
|
—
|
%
|
|
—
|
%
|
|
5
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Useful Life
(in years)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Equipment
|
7-20
|
|
$
|
42,879,308
|
|
|
$
|
40,404,582
|
|
Furniture and fixtures
|
7
|
|
108,896
|
|
|
108,896
|
|
||
Leasehold improvements
|
15
|
|
2,434,690
|
|
|
2,331,071
|
|
||
Office equipment
|
5
|
|
1,213,865
|
|
|
1,190,509
|
|
||
Vehicles
|
5
|
|
7,114,001
|
|
|
6,899,388
|
|
||
Building
|
20
|
|
274,203
|
|
|
274,203
|
|
||
Construction in progress
|
|
|
12,361,034
|
|
|
12,720,188
|
|
||
Land
|
|
|
3,083,551
|
|
|
2,833,551
|
|
||
Total fixed assets
|
|
|
69,469,548
|
|
|
66,762,388
|
|
||
Less accumulated depreciation
|
|
|
(24,708,151
|
)
|
|
(19,874,896
|
)
|
||
Net fixed assets
|
|
|
$
|
44,761,397
|
|
|
$
|
46,887,492
|
|
|
|
||
Beginning balance at January 1, 2019
|
$
|
—
|
|
Capital contribution from non-controlling interest
|
3,150,000
|
|
|
Initial adjustment of carrying amount of non-controlling interest
|
(970,809
|
)
|
|
Net loss attributable to redeemable non-controlling interest
|
(61,668
|
)
|
|
Accretion of non-controlling interest to redemption value
|
2,279,371
|
|
|
Ending balance at December 31, 2019
|
$
|
4,396,894
|
|
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
Useful Life
(in years)
|
|
Gross
Carrying
Amount
|
|
Accumulated Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying Amount |
|
Accumulated Amortization |
|
Net
Carrying Amount |
||||||||||||
Customer relations
|
|
5-8
|
|
$
|
1,329,580
|
|
|
$
|
884,917
|
|
|
$
|
444,663
|
|
|
$
|
1,329,580
|
|
|
$
|
718,890
|
|
|
$
|
610,690
|
|
Vendor relations
|
|
10
|
|
6,654,497
|
|
|
4,197,213
|
|
|
2,457,284
|
|
|
6,654,497
|
|
|
3,531,764
|
|
|
3,122,733
|
|
||||||
Trademark/Trade name
|
|
6-16
|
|
1,249,887
|
|
|
531,885
|
|
|
718,002
|
|
|
1,249,887
|
|
|
436,869
|
|
|
813,018
|
|
||||||
TCEP Technology/Patent
|
|
15
|
|
13,287,000
|
|
|
6,180,643
|
|
|
7,106,357
|
|
|
13,287,000
|
|
|
5,294,843
|
|
|
7,992,157
|
|
||||||
Non-compete agreements
|
|
3-5
|
|
196,601
|
|
|
168,200
|
|
|
28,401
|
|
|
196,601
|
|
|
156,680
|
|
|
39,921
|
|
||||||
Internally developed software in progress
|
|
3-5
|
|
489,093
|
|
|
—
|
|
|
489,093
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
$
|
23,206,658
|
|
|
$
|
11,962,858
|
|
|
$
|
11,243,800
|
|
|
$
|
22,717,565
|
|
|
$
|
10,139,046
|
|
|
$
|
12,578,519
|
|
2020
|
$
|
1,921,630
|
|
2021
|
1,921,630
|
|
|
2022
|
1,706,702
|
|
|
2023
|
1,349,318
|
|
|
2024
|
1,292,875
|
|
|
Thereafter
|
3,051,645
|
|
|
|
$
|
11,243,800
|
|
|
2019
|
|
2018
|
||||
Accounts receivable trade
|
$
|
12,540,553
|
|
|
$
|
9,859,758
|
|
Allowance for doubtful accounts
|
(402,475
|
)
|
|
(831,768
|
)
|
||
Accounts receivable trade, net
|
$
|
12,138,078
|
|
|
$
|
9,027,990
|
|
Creditor
|
|
Loan Type
|
|
Origination Date
|
|
Maturity Date
|
|
Loan Amount
|
|
Balance on December 31, 2019
|
Balance on December 31, 2018
|
||||||
Encina Business Credit, LLC
|
|
Term Loan
|
|
February 1, 2017
|
|
February 1, 2021
|
|
$
|
20,000,000
|
|
|
$
|
13,333,000
|
|
$
|
15,350,000
|
|
Encina Business Credit SPV, LLC
|
|
Revolving Note
|
|
February 1, 2017
|
|
February 1, 2021
|
|
$
|
10,000,000
|
|
|
3,276,230
|
|
3,844,636
|
|
||
Tetra Capital Lease
|
|
Finance Lease
|
|
May, 2018
|
|
May, 2022
|
|
$
|
419,690
|
|
|
264,014
|
|
349,822
|
|
||
Wells Fargo Equipment Lease-VRM LA
|
|
Finance Lease
|
|
March, 2018
|
|
March, 2021
|
|
$
|
30,408
|
|
|
12,341
|
|
22,390
|
|
||
Wells Fargo Equipment Lease-Ohio
|
|
Finance Lease
|
|
April-May, 2019
|
|
April-May, 2024
|
|
$
|
621,000
|
|
|
551,260
|
|
—
|
|
||
Various institutions
|
|
Insurance premiums financed
|
|
Various
|
|
< 1 year
|
|
$
|
2,902,428
|
|
|
1,165,172
|
|
999,152
|
|
||
Total
|
|
|
|
|
|
|
|
|
|
18,602,017
|
|
20,566,000
|
|
||||
Deferred finance costs
|
|
|
|
|
|
|
|
|
|
(47,826
|
)
|
(621,733
|
)
|
||||
Total, net of deferred finance costs
|
|
|
|
|
|
|
|
|
|
$
|
18,554,191
|
|
$
|
19,944,267
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
Creditor
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
||||||||||||
Encina Business Credit, LLC
|
|
$
|
900,000
|
|
|
$
|
12,433,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Encina Business Credit SPV, LLC
|
|
3,276,230
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tetra Capital Lease
|
|
91,779
|
|
|
98,167
|
|
|
74,068
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Wells Fargo Equipment Lease-VRM LA
|
|
10,537
|
|
|
1,804
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Wells Fargo Equipment Lease-Ohio
|
|
114,848
|
|
|
120,895
|
|
|
127,264
|
|
|
138,476
|
|
|
49,777
|
|
|
—
|
|
||||||
Various institutions
|
|
1,165,172
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Totals
|
|
5,558,566
|
|
|
12,653,866
|
|
|
201,332
|
|
|
138,476
|
|
|
49,777
|
|
|
—
|
|
||||||
Deferred finance costs
|
|
(47,826
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Totals, net of deferred finance costs
|
|
$
|
5,510,740
|
|
|
$
|
12,653,866
|
|
|
$
|
201,332
|
|
|
$
|
138,476
|
|
|
$
|
49,777
|
|
|
$
|
—
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Current federal tax (expense)/benefit
|
|
$
|
(68,606
|
)
|
|
$
|
(137,212
|
)
|
Deferred federal tax (expense)/benefit
|
|
68,606
|
|
|
137,212
|
|
||
Total federal tax (expense)/benefit
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Statutory tax on book income
|
|
$
|
(1,152,000
|
)
|
|
$
|
(417,000
|
)
|
Permanent differences
|
|
139,000
|
|
|
114,000
|
|
||
Change in derivative liability
|
|
102,000
|
|
|
(160,000
|
)
|
||
Myrtle Grove transaction gain
|
|
210,000
|
|
|
—
|
|
||
Change in valuation allowance
|
|
1,344,000
|
|
|
967,000
|
|
||
Prior year return true up
|
|
(643,000
|
)
|
|
(504,000
|
)
|
||
Income tax expense (benefit)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Alternative minimum tax credits
|
|
$
|
69,000
|
|
|
$
|
137,000
|
|
Accrued bonus and stock based compensation
|
|
386,000
|
|
|
358,000
|
|
||
Basis of intangible assets
|
|
1,687,000
|
|
|
1,368,000
|
|
||
Bad debt reserve
|
|
85,000
|
|
|
175,000
|
|
||
Contribution carryover
|
|
38,000
|
|
|
26,000
|
|
||
Interest expense carryforward
|
|
487,000
|
|
|
190,000
|
|
||
Net operating loss carry forwards
|
|
13,682,000
|
|
|
12,500,000
|
|
||
Less valuation allowance
|
|
(13,453,000
|
)
|
|
(12,109,000
|
)
|
||
Total deferred tax assets
|
|
$
|
2,981,000
|
|
|
$
|
2,645,000
|
|
|
|
|
|
|
||||
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Deferred tax liabilities:
|
|
|
|
|
||||
Basis of fixed assets
|
|
$
|
(2,788,000
|
)
|
|
$
|
(2,444,000
|
)
|
Contingent liability
|
|
—
|
|
|
3,000
|
|
||
Partnership income
|
|
(124,000
|
)
|
|
(67,000
|
)
|
||
Total deferred tax liabilities
|
|
$
|
(2,912,000
|
)
|
|
$
|
(2,508,000
|
)
|
|
|
|
|
|
||||
Net deferred tax assets
|
|
$
|
69,000
|
|
|
$
|
137,000
|
|
OPTIONS ISSUED FOR COMPENSATION:
|
|
Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life
(in Years)
|
|
Grant Date
Fair Value
|
|||||
Outstanding at December 31, 2017
|
|
3,180,417
|
|
|
$
|
2.21
|
|
|
4.62
|
|
$
|
3,298,196
|
|
Options granted
|
|
697,000
|
|
|
1.17
|
|
|
8.10
|
|
610,305
|
|
||
Options exercised
|
|
(7,500
|
)
|
|
1.20
|
|
|
0.00
|
|
(4,241
|
)
|
||
Options cancelled/forfeited/expired
|
|
(409,167
|
)
|
|
1.80
|
|
|
0.00
|
|
(434,962
|
)
|
||
Outstanding at December 31, 2018
|
|
3,460,750
|
|
|
$
|
2.05
|
|
|
3.50
|
|
$
|
3,469,298
|
|
Vested at December 31, 2018
|
|
2,127,500
|
|
|
$
|
2.48
|
|
|
4.67
|
|
$
|
2,122,478
|
|
Exercisable at December 31, 2018
|
|
2,127,500
|
|
|
$
|
2.48
|
|
|
4.67
|
|
$
|
2,122,478
|
|
|
|
|
|
|
|
|
|
|
|||||
Outstanding at December 31, 2018
|
|
3,460,750
|
|
|
$
|
2.05
|
|
|
3.50
|
|
$
|
3,469,298
|
|
Options granted
|
|
1,150,000
|
|
|
1.40
|
|
|
8.76
|
|
1,148,662
|
|
||
Options exercised
|
|
(112,500
|
)
|
|
0.46
|
|
|
0.00
|
|
(41,789
|
)
|
||
Options cancelled/forfeited/expired
|
|
(80,000
|
)
|
|
0.46
|
|
|
0.00
|
|
(28,800
|
)
|
||
Outstanding at December 31, 2019
|
|
4,418,250
|
|
|
$
|
1.95
|
|
|
6.25
|
|
$
|
4,547,371
|
|
Vested at December 31, 2019
|
|
2,383,625
|
|
|
$
|
2.50
|
|
|
4.84
|
|
$
|
2,625,779
|
|
Exercisable at December 31, 2019
|
|
2,383,625
|
|
|
$
|
2.50
|
|
|
4.84
|
|
$
|
2,625,779
|
|
WARRANTS ISSUED AND OTHER THAN SERIES B AND B1 PREFERRED STOCK:
|
|
Warrants
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life
(in Years)
|
|
Grant Date
Fair Value
|
||||||
|
|
|
|
|
|
|
|
|
||||||
Outstanding at December 31, 2017
|
|
219,868
|
|
|
$
|
3.01
|
|
|
2.00
|
|
|
$
|
140,249
|
|
Warrants granted
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Warrants exercised
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Warrants canceled/forfeited/expired
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Warrants at December 31, 2018
|
|
219,868
|
|
|
$
|
3.01
|
|
|
0.93
|
|
|
$
|
140,249
|
|
Vested at December 31, 2018
|
|
219,868
|
|
|
$
|
3.01
|
|
|
0.93
|
|
|
$
|
140,249
|
|
Exercisable at December 31, 2018
|
|
219,868
|
|
|
$
|
3.01
|
|
|
0.93
|
|
|
$
|
140,249
|
|
|
|
|
|
|
|
|
|
|
||||||
Outstanding at December 31, 2018
|
|
219,868
|
|
|
$
|
3.01
|
|
|
0.93
|
|
|
$
|
140,249
|
|
Warrants granted
|
|
1,500,000
|
|
|
2.25
|
|
|
9.70
|
|
|
1,496,372
|
|
||
Warrants exercised
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Warrants canceled/forfeited/expired
|
|
(219,868
|
)
|
|
3.01
|
|
|
—
|
|
|
(140,249
|
)
|
||
Warrants at December 31, 2019
|
|
1,500,000
|
|
|
$
|
2.25
|
|
|
9.70
|
|
|
$
|
1,496,372
|
|
Vested at December 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Exercisable at December 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
|
2019
|
|
2018
|
||||
Basic loss per Share
|
|
|
|
|
||||
Numerator:
|
|
|
|
|
||||
Net loss available to common shareholders
|
|
$
|
(11,445,628
|
)
|
|
$
|
(8,037,304
|
)
|
Denominator:
|
|
|
|
|
|
|
||
Weighted-average common shares outstanding
|
|
40,988,946
|
|
|
35,411,264
|
|
||
Basic loss per share
|
|
$
|
(0.28
|
)
|
|
$
|
(0.23
|
)
|
|
|
|
|
|
||||
Diluted Earnings per Share
|
|
|
|
|
||||
Numerator:
|
|
|
|
|
||||
Net loss available to common shareholders
|
|
$
|
(11,445,628
|
)
|
|
$
|
(8,037,304
|
)
|
Denominator:
|
|
|
|
|
|
|
||
Weighted-average shares outstanding
|
|
40,988,946
|
|
|
35,411,264
|
|
||
Effect of dilutive securities
|
|
|
|
|
||||
Stock options and warrants
|
|
—
|
|
|
—
|
|
||
Preferred stock
|
|
—
|
|
|
—
|
|
||
Diluted weighted-average shares outstanding
|
|
40,988,946
|
|
|
35,411,264
|
|
||
Diluted loss per share
|
|
$
|
(0.28
|
)
|
|
$
|
(0.23
|
)
|
•
|
The affirmative vote or written consent of the holders of a majority of the then-outstanding shares of Series A Preferred;
|
•
|
If the closing market price of our common stock averages at least $15.00 per share over a period of 20 consecutive trading days and the daily trading volume averages at least 7,500 shares over such period;
|
•
|
If we consummate an underwritten public offering of our securities at a price per share not less than $10.00 and for a total gross offering amount of at least $10 million; or
|
•
|
If a sale of the Company occurs resulting in proceeds to the holders of Series A Preferred of a per share amount of at least $10.00.
|
|
2019
|
|
2018
|
||||
Balance at beginning of period
|
$
|
8,900,208
|
|
|
$
|
7,190,467
|
|
Less: conversions of shares to common
|
—
|
|
|
(62,962
|
)
|
||
Plus: discount accretion
|
1,420,391
|
|
|
1,118,259
|
|
||
Plus: dividends in kind
|
685,807
|
|
|
654,444
|
|
||
Balance at end of period
|
$
|
11,006,406
|
|
|
$
|
8,900,208
|
|
Face amount of Series B Preferred Stock
|
|
$
|
25,000,000
|
|
Less: allocated value of Warrants
|
|
7,028,067
|
|
|
Allocated value of Series B Preferred Stock
|
|
$
|
17,971,933
|
|
Shares of Common stock to be converted
|
|
8,064,534
|
|
|
Effective conversion price
|
|
$
|
2.23
|
|
Market price
|
|
$
|
2.94
|
|
Intrinsic value per share
|
|
$
|
0.7115
|
|
Intrinsic value of beneficial conversion feature
|
|
$
|
5,737,796
|
|
|
2019
|
|
2018
|
||||
Balance at beginning of period
|
$
|
13,279,755
|
|
|
$
|
15,769,478
|
|
Less: conversions of shares to common
|
(2,241,890
|
)
|
|
(5,068,602
|
)
|
||
Plus: discount accretion
|
749,206
|
|
|
841,754
|
|
||
Plus: dividends in kind
|
955,976
|
|
|
1,737,125
|
|
||
Balance at end of period
|
$
|
12,743,047
|
|
|
$
|
13,279,755
|
|
|
|
May 13, 2016
|
||
Face amount of Series B1 Preferred Stock
|
|
$
|
19,349,745
|
|
Less: allocated value of May 2016 Warrants
|
|
2,867,264
|
|
|
Allocated value of Series B1 Preferred Stock
|
|
$
|
16,482,481
|
|
Shares of Common stock to be converted
|
|
12,403,683
|
|
|
Effective conversion price
|
|
$
|
1.33
|
|
Market price
|
|
$
|
1.52
|
|
Intrinsic value per share
|
|
$
|
0.19
|
|
Intrinsic value of May 2016 beneficial conversion feature
|
|
$
|
2,371,106
|
|
Level Three Roll-Forward
|
|
Year Ended December 31,
|
|||||
|
|
2019
|
2018
|
||||
Balance at beginning of period
|
|
$
|
1,481,692
|
|
$
|
2,245,408
|
|
Change in fair value of warrants
|
|
487,524
|
|
(763,716
|
)
|
||
Balance at end of period
|
|
$
|
1,969,216
|
|
$
|
1,481,692
|
|
December 31, 2019
|
|||||||||
Contract Type
|
Contract Period
|
Weighted Average Trade Price (Barrels)
|
Remaining Volume (Barrels)
|
Fair Value
|
|||||
|
|
|
|
|
|||||
Swap
|
Dec. 2019- Mar. 2020
|
$
|
40.88
|
|
130,000
|
|
$
|
539,800
|
|
Swap
|
Dec. 2019- Mar. 2020
|
$
|
81.19
|
|
130,000
|
|
$
|
(673,428
|
)
|
Futures
|
Dec. 2019- Mar. 2020
|
$
|
84.83
|
|
105,000
|
|
$
|
(242,222
|
)
|
December 31, 2018
|
|||||||||
Contract Type
|
Contract Period
|
Weighted Average Trade Price (Barrels)
|
Remaining Volume (Barrels)
|
Fair Value
|
|||||
|
|
|
|
|
|||||
Swap
|
Dec. 2018- Feb. 2019
|
$
|
48.78
|
|
60,000
|
|
$
|
(1,048,400
|
)
|
Swap
|
Dec. 2018- Feb. 2019
|
$
|
68.69
|
|
60,000
|
|
$
|
1,097,124
|
|
Futures
|
Feb. 2019- Mar. 2019
|
$
|
70.42
|
|
69,000
|
|
$
|
394,317
|
|
Futures
|
Dec. 2018- Feb. 2019
|
$
|
45.41
|
|
30,000
|
|
$
|
252,900
|
|
Balance Sheet Classification
|
Contract Type
|
2019
|
2018
|
||||
|
|
|
|
||||
|
Crude oil swaps
|
$
|
(133,628
|
)
|
$
|
48,724
|
|
|
Crude oil futures
|
(242,222
|
)
|
647,217
|
|
||
|
|
|
|
||||
Derivative commodity asset (liability)
|
|
$
|
(375,850
|
)
|
$
|
695,941
|
|
YEAR ENDED DECEMBER 31, 2019
|
||||||||||||||||
|
|
Black Oil
|
|
Refining and Marketing
|
|
Recovery
|
|
Total
|
||||||||
Revenues
|
|
$
|
139,269,164
|
|
|
$
|
12,957,767
|
|
|
$
|
11,138,634
|
|
|
$
|
163,365,565
|
|
Income (loss) from operations
|
|
$
|
433,901
|
|
|
$
|
(576,487
|
)
|
|
$
|
(2,631,458
|
)
|
|
$
|
(2,774,044
|
)
|
Total assets
|
|
$
|
114,976,772
|
|
|
$
|
1,101,470
|
|
|
$
|
4,681,677
|
|
|
$
|
120,759,919
|
|
|
|
|
|
|
|
|
|
|
||||||||
YEAR ENDED DECEMBER 31, 2018
|
||||||||||||||||
|
|
Black Oil
|
|
Refining and Marketing
|
|
Recovery
|
|
Total
|
||||||||
Revenues
|
|
$
|
143,836,981
|
|
|
$
|
22,935,482
|
|
|
$
|
13,948,198
|
|
|
$
|
180,720,661
|
|
Income (loss) from operations
|
|
$
|
3,561,223
|
|
|
$
|
(2,250,924
|
)
|
|
$
|
(821,951
|
)
|
|
$
|
488,348
|
|
Total assets
|
|
$
|
76,540,888
|
|
|
$
|
1,407,002
|
|
|
$
|
6,212,518
|
|
|
$
|
84,160,408
|
|
|
|
|
|
|
|
|
|
|
|
Facilities
|
|
Equipment
|
|
Plant
|
|
Railcar
|
|
Total
|
||||||||||
Year 1
|
$
|
719,607
|
|
|
$
|
161,539
|
|
|
$
|
4,060,417
|
|
|
$
|
943,741
|
|
|
$
|
5,885,304
|
|
Year 2
|
549,293
|
|
|
161,539
|
|
|
4,060,417
|
|
|
582,386
|
|
|
5,353,635
|
|
|||||
Year 3
|
392,654
|
|
|
26,953
|
|
|
4,060,417
|
|
|
24,696
|
|
|
4,504,720
|
|
|||||
Year 4
|
306,000
|
|
|
—
|
|
|
4,060,417
|
|
|
1,278
|
|
|
4,367,695
|
|
|||||
Year 5
|
300,000
|
|
|
—
|
|
|
4,060,417
|
|
|
—
|
|
|
4,360,417
|
|
|||||
Thereafter
|
2,375,000
|
|
|
—
|
|
|
35,524,907
|
|
|
—
|
|
|
37,899,907
|
|
|||||
Total lease payments
|
$
|
4,642,554
|
|
|
$
|
350,031
|
|
|
$
|
55,826,992
|
|
|
$
|
1,552,101
|
|
|
$
|
62,371,678
|
|
Less: interest
|
(1,685,627
|
)
|
|
(22,605
|
)
|
|
(24,980,750
|
)
|
|
(95,811
|
)
|
|
(26,784,793
|
)
|
|||||
Present value of lease liabilities
|
$
|
2,956,927
|
|
|
$
|
327,426
|
|
|
$
|
30,846,242
|
|
|
$
|
1,456,290
|
|
|
$
|
35,586,885
|
|
Remaining lease term and discount rate:
|
|
December 31, 2019
|
|
Weighted average remaining lease terms (years)
|
|
|
|
Lease facilities
|
|
5.34
|
|
Lease equipment
|
|
2.17
|
|
Lease plant
|
|
13.26
|
|
Lease railcar
|
|
1.33
|
|
Weighted average discount rate
|
|
|
|
Lease facilities
|
|
9.17
|
%
|
Lease equipment
|
|
8.00
|
%
|
Lease plant
|
|
9.37
|
%
|
Lease railcar
|
|
8.00
|
%
|
•
|
Documents filed as part of this report
|
•
|
All financial statements
|
Index to Consolidated Financial Statements
|
|
Page
|
Report of Independent Registered Public Accounting Firm
|
|
|
Consolidated Balance Sheets as of December 31, 2019 and 2018
|
|
|
Consolidated Statements of Operations for the years ended December 31, 2019 and 2018
|
|
|
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2019 and 2018
|
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2019 and 2018
|
|
|
Notes to Consolidated Financial Statements
|
|
•
|
Exhibits required by Item 601 of Regulation S-K
|
|
|
|
|
|
|
Incorporated by Reference
|
||||
Exhibit
Number
|
|
|
|
Filed or
Furnished
Herewith
|
|
Form
|
|
|
File No.
|
|
2.1(+)
|
|
|
|
|
8-K
|
2.1
|
7/31/2019
|
001-11476
|
||
2.2(+)
|
|
|
|
|
8-K
|
2.2
|
1/24/2020
|
000-53619
|
||
3.1
|
|
|
|
|
8-K/A
|
3.1
|
6/26/2009
|
000-53619
|
||
3.2
|
|
|
|
|
8-K
|
3.1
|
7/16/2010
|
000-53619
|
||
3.3
|
|
|
|
|
8-K
|
3.1
|
5/13/2016
|
001-11476
|
||
3.4
|
|
|
|
|
8-K
|
3.2
|
5/13/2016
|
001-11476
|
||
3.5
|
|
|
|
|
8-K
|
3.3
|
5/13/2016
|
001-11476
|
||
3.6
|
|
|
|
|
8-K
|
3.1
|
4/29/2019
|
001-11476
|
||
4.1
|
|
|
X
|
|
|
|
|
|
||
10.1(#)
|
|
|
|
|
8-K
|
10.1
|
11/12/2013
|
001-11476
|
||
10.2
|
|
|
|
|
8-K/A
|
4.1
|
6/26/2009
|
000-53619
|
||
10.3
|
|
|
|
|
10-K
|
10.27
|
12/31/2012
|
001-11476
|
||
10.4
|
|
|
|
|
8-K
|
4.1
|
7/31/2009
|
000-53619
|
||
10.5
|
|
|
|
|
10-K
|
10.29
|
12/31/2012
|
001-11476
|
||
10.6
|
|
|
|
|
S-8
|
4.1
|
7/28/2014
|
333-197659
|
||
10.7
|
|
|
|
|
8-K
|
10.1
|
9/30/2013
|
001-11476
|
||
10.8
|
|
|
|
|
S-8
|
4.3
|
7/28/2014
|
333-197659
|
|
|
|
|
|
|
Incorporated by Reference
|
||||
Exhibit
Number
|
|
|
|
Filed or
Furnished
Herewith
|
|
Form
|
|
|
File No.
|
|
10.9
|
|
|
|
|
8-K
|
10.1
|
7/29/2014
|
001-11476
|
||
10.10
|
|
|
|
|
10-Q
|
10.22
|
6/30/2014
|
001-11476
|
||
10.11
|
|
|
|
|
10-Q
|
10.23
|
6/30/2014
|
001-11476
|
||
10.12
|
|
|
|
|
8-K
|
4.1
|
|
12/9/2014
|
001-11476
|
|
10.13
|
|
|
|
|
8-K
|
4.2
|
|
12/9/2014
|
001-11476
|
|
10.14
|
|
|
|
|
8-K
|
10.1
|
6/19/2015
|
001-11476
|
||
10.15
|
|
|
|
|
8-K
|
10.3
|
|
6/19/2015
|
001-11476
|
|
10.16
|
|
|
|
|
10-Q
|
10.73
|
|
6/30/2015
|
001-11476
|
|
10.17
|
|
|
|
|
10-Q
|
10.74
|
|
6/30/2015
|
001-11476
|
|
10.18
|
|
|
|
|
8-K
|
10.1
|
|
9/21/2015
|
001-11476
|
|
10.19(##)
|
|
|
|
|
8-K/A
|
10.2
|
|
11/10/2015
|
001-11476
|
|
10.20
|
|
|
|
|
8-K
|
10.1
|
|
10/19/2015
|
001-11476
|
|
10.21(##)
|
|
|
|
|
8-K
|
10.1
|
1/15/2016
|
001-11476
|
||
10.22(##)
|
|
|
|
|
8-K
|
10.1
|
2/3/2016
|
001-11476
|
||
10.23(##)
|
|
|
|
|
8-K
|
10.2
|
2/3/2016
|
001-11476
|
||
10.24
|
|
|
|
|
8-K
|
10.2
|
5/13/2016
|
001-11476
|
||
10.25
|
|
|
|
|
8-K
|
10.1
|
2/7/2017
|
001-11476
|
|
|
|
|
|
|
Incorporated by Reference
|
||||
Exhibit
Number
|
|
|
|
Filed or
Furnished
Herewith
|
|
Form
|
|
|
File No.
|
|
10.26
|
|
|
|
|
8-K
|
10.2
|
2/7/2017
|
001-11476
|
||
10.27
|
|
|
|
|
8-K
|
10.3
|
2/7/2017
|
001-11476
|
||
10.28 (###)
|
|
|
|
|
10-K
|
10.66
|
12/31/2016
|
001-11476
|
||
10.29
|
|
|
|
|
8-K
|
10.3
|
12/19/2017
|
001-11476
|
||
10.30
|
|
|
|
|
8-K
|
10.4
|
12/19/2017
|
001-11476
|
||
10.31
|
|
|
|
|
8-K
|
10.5
|
12/19/2017
|
001-11476
|
||
10.32%
|
|
|
|
|
|
8-K
|
10.1
|
7/31/2019
|
001-11476
|
|
10.33
|
|
|
|
|
8-K
|
10.2
|
7/31/2019
|
001-11476
|
||
10.34%
|
|
|
|
|
8-K
|
10.3
|
7/31/2019
|
001-11476
|
||
10.35
|
|
|
|
|
8-K
|
10.4
|
7/31/2019
|
001-11476
|
||
10.36
|
|
|
|
|
8-K
|
10.5
|
7/31/2019
|
001-11476
|
||
10.37%
|
|
|
|
|
|
8-K
|
10.8
|
7/31/2019
|
001-11476
|
|
|
|
|
|
|
Incorporated by Reference
|
||||
Exhibit
Number
|
|
|
|
Filed or
Furnished
Herewith
|
|
Form
|
|
|
File No.
|
|
10.38%
|
|
|
|
|
8-K
|
10.9
|
7/31/2019
|
001-11476
|
||
10.39
|
|
|
|
|
8-K
|
2.1
|
10/29/2019
|
001-11476
|
||
10.40%£
|
|
|
|
|
|
8-K
|
10.1
|
1/13/2020
|
001-11476
|
|
|
|
|
|
|
8-K
|
10.2
|
1/24/2020
|
001-11476
|
||
14.1
|
|
|
|
|
8-K/A
|
14.1
|
2/13/2013
|
001-11476
|
||
21.1
|
|
|
X
|
|
|
|
|
|
||
23.1
|
|
|
X
|
|
|
|
|
|
||
31.1
|
|
|
X
|
|
|
|
|
|
||
31.2
|
|
|
X
|
|
|
|
|
|
||
32.1
|
|
|
X
|
|
|
|
|
|
||
32.2
|
|
|
X
|
|
|
|
|
|
||
99.1
|
|
|
|
|
10-K
|
99.1
|
12/31/2012
|
001-11476
|
||
99.2
|
|
|
|
|
8-K/A
|
99.2
|
2/13/2013
|
001-11476
|
||
99.3
|
|
|
|
|
10-Q
|
99.2
|
9/30/2013
|
001-11476
|
||
99.4
|
|
|
|
|
10-Q
|
99.2
|
9/30/2014
|
001-11476
|
||
99.5
|
|
|
|
|
8-K
|
99.2
|
1/24/2020
|
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
|
|
|
|
|
|
|
VERTEX ENERGY, INC.
|
|
|
Date: March 3, 2020
|
By: /s/ Benjamin P. Cowart
|
|
Benjamin P. Cowart
|
|
Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
|
|
Date: March 3, 2020
|
By: /s/ Chris Carlson
|
|
Chris Carlson
|
|
Chief Financial Officer
|
|
(Principal Accounting/Financial Officer)
|
By:
|
/s/ Benjamin P. Cowart
|
By:
|
/s/ Chris Carlson
|
|
Benjamin P. Cowart
Chief Executive Officer
(Principal Executive Officer)
and Chairman
|
|
Chris Carlson
Chief Financial Officer
(Principal Accounting/Financial Officer)
|
Date:
|
March 3, 2020
|
Date:
|
March 3, 2020
|
|
|
|
|
By:
|
/s/ Christopher Stratton
|
By:
|
/s/ Dan Borgen
|
|
Christopher Stratton
Director
|
|
Dan Borgen
Director
|
|
|
|
|
Date:
|
March 3, 2020
|
Date:
|
March 3, 2020
|
|
|
|
|
By:
|
/s/ Timothy C. Harvey
|
By:
|
/s/ David Phillips
|
|
Timothy C. Harvey
Director
|
|
David Phillips
Director
|
|
|
|
|
Date:
|
March 3, 2020
|
Date:
|
March 3, 2020
|
|
|
|
|
By:
|
/s/ James P. Gregory
|
|
|
|
James P. Gregory
|
|
|
|
Director
|
|
|
|
|
|
|
Date:
|
March 3, 2020
|
|
|
•
|
Vertex Energy Operating, LLC, a Texas Limited Liability Company (wholly-owned)(“Vertex Operating”)
|
•
|
Vertex Refining, LA,, LLC, a Louisiana Limited Liability Company (wholly-owned by Vertex Operating)
|
•
|
Vertex Recovery Management, LLC, a Texas Limited Liability Company (wholly-owned)(“Vertex Recovery”)
|
•
|
Vertex Recovery Management LA, LLC, a Louisiana Limited Liability Company (51% owned by Vertex Recovery Management, LLC and 49% owned by Industrial Pipe, Inc.)
|
•
|
Vertex Splitter Corporation, a Delaware corporation (wholly-owned)
|
•
|
Vertex Refining Myrtle Grove LLC, a Delaware Limited Liability Company (84.42% owned by Vertex Operating)
|
•
|
HPRM LLC, a Delaware Limited Liability Company (35% owned by Vertex Operating)
|
•
|
Vertex Acquisition Sub, LLC, a Nevada Limited Liability Company (“Vertex Acquisition”) (wholly-owned by Vertex Operating)
|
◦
|
Cedar Marine Terminals, L.P., a Texas limited partnership
|
◦
|
Crossroad Carriers, L.P., a Texas limited partnership
|
◦
|
Vertex Recovery, L.P., a Texas limited partnership
|
◦
|
H&H Oil, L.P., a Texas limited partnership
|
1.
|
I have reviewed this Annual Report on Form 10-K 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(s) 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 an Annual 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(s) 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: March 3, 2020
|
By:
|
/s/ Benjamin P. Cowart
|
|
|
Benjamin P. Cowart
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Annual Report on Form 10-K 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(s) 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 an Annual 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(s) 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: March 3, 2020
|
By:
|
/s/ Chris Carlson
|
|
|
Chris Carlson
|
|
|
Chief Financial Officer
(Principal Accounting and Financial Officer)
|
Date: March 3, 2020
|
By:
|
/s/ Benjamin P. Cowart
|
|
|
Benjamin P. Cowart
|
|
|
Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Date: March 3, 2020
|
By:
|
/s/ Chris Carlson
|
|
|
Chris Carlson
|
|
|
Chief Financial Officer
(Principal Accounting and Financial Officer)
|