- Amended term loan provides for an incremental $50.0 million of
liquidity on balance sheet
- Additional financing is expected to provide strategic
flexibility around potential transaction opportunities
Vertex Energy, Inc. (NASDAQ: VTNR) (“Vertex” or the “Company”),
a leading specialty refiner and marketer of high-quality refined
products, today announced that it has successfully amended its
existing term loan agreement. The Company has reached an agreement
with its existing group of lenders to modify certain terms and
conditions of the term loan agreement aimed at improving the
Company’s balance sheet.
The amended term loan provides for an incremental $50.0 million
in borrowings to Vertex, the full amount of which was borrowed upon
closing, which brings the total outstanding balance on the term
loan to $198.0 million. The amended agreement also bears interest
at a rate of a base rate calculated as the greater of (i) prime
minus 1.5%, and (ii) the federal funds rate (not less than 1%) plus
0.5%, plus 1025 basis points and includes no change to the previous
duration of the term loan agreement due April 1, 2025. These
amendments were pursued to support current operational and
strategic needs as the Company continues to evaluate previously
disclosed alternative options aimed at strengthening the Company’s
balance sheet. The lenders also have the option in their sole
discretion to provide up to an additional $25.0 million of lending
availability under the term loan, subject to certain terms and
conditions.
Benjamin P. Cowart, President and CEO of Vertex, stated, “This
agreement not only reinforces our liquidity position but also gives
us the strategic latitude to continue a comprehensive evaluation of
potential transaction opportunities around the business. We believe
our lending partners share our vision of the long-term value
potential of the Company, and we believe this enhanced flexibility
will be in the best interest of our shareholders, as we continue to
work to make steady progress toward achieving our goals.”
Additional information on the amended term loan can be found in
our Current Report on Form 8-K filed with the U.S. Securities and
Exchange Commission on January 2, 2024.
ABOUT VERTEX ENERGY
Vertex Energy is a leading energy transition company that
specializes in producing both renewable and conventional fuels. The
Company’s innovative solutions are designed to enhance the
performance of our customers and partners while also prioritizing
sustainability, safety, and operational excellence. With a
commitment to providing superior products and services, Vertex
Energy is dedicated to shaping the future of the energy
industry.
FORWARD-LOOKING STATEMENTS
Certain of the matters discussed in this communication which are
not statements of historical fact constitute forward-looking
statements within the meaning of the securities laws, including the
Private Securities Litigation Reform Act of 1995, that involve a
number of risks and uncertainties. Words such as “strategy,”
“expects,” “continues,” “plans,” “anticipates,” “believes,”
“would,” “will,” “estimates,” “intends,” “projects,” “goals,”
“targets” and other words of similar meaning are intended to
identify forward-looking statements but are not the exclusive means
of identifying these statements. Any statements made in this news
release other than those of historical fact, about an action, event
or development, are forward-looking statements. The important
factors that may cause actual results and outcomes to differ
materially from those contained in such forward-looking statements
include, without limitation, the Company’s previously disclosed
projected outlook for the fourth quarter of 2023; the review and
evaluation of potential joint ventures, divestitures, acquisitions,
mergers, business combinations, or other strategic transactions,
the outcome of such review, and the impact on any such
transactions, or the review thereof, on shareholder value; the
process by which the Company engages in evaluation of strategic
transactions; the Company’s ability to identify potential partners;
the outcome of potential future strategic transactions and the
terms thereof; the future production of the Company’s Mobile
Refinery; anticipated and unforeseen events which could reduce
future production at the refinery or delay future capital projects,
and changes in commodity and credit values; throughput volumes,
production rates, yields, operating expenses and capital
expenditures at the Mobile Refinery; the timing of, and outcome of,
the evaluation and associated carbon intensity scoring of the
Company’s feedstock blends by officials in the state of California;
the ability of the Company to obtain low carbon fuel standard
(LCFS) credits, and the amounts thereof; the need for additional
capital in the future, including, but not limited to, in order to
complete future capital projects and satisfy liabilities, the
Company’s ability to raise such capital in the future, and the
terms of such funding; the timing of capital projects at the
Company’s refinery located in Mobile, Alabama (the “Mobile
Refinery”) and the outcome of such projects; the future production
of the Mobile Refinery, including but not limited to, renewable
diesel production; estimated and actual production and costs
associated with the renewable diesel capital project; estimated
revenues, margins and expenses, over the course of the agreement
with Idemitsu; anticipated and unforeseen events which could reduce
future production at the Mobile Refinery or delay planned and
future capital projects; changes in commodity and credits values;
certain early termination rights associated with third party
agreements and conditions precedent to such agreements; certain
mandatory redemption provisions of the outstanding senior
convertible notes, the conversion rights associated therewith, and
dilution caused by conversions and/or the exchanges of convertible
notes; the Company’s ability to comply with required covenants
under outstanding senior notes and a term loan and pay amounts due
under such senior notes and term loan, including interest and other
amounts due thereunder; the ability of the Company to retain and
hire key personnel; the level of competition in the Company’s
industry and its ability to compete; the Company’s ability to
respond to changes in its industry; the loss of key personnel or
failure to attract, integrate and retain additional personnel; the
Company’s ability to protect intellectual property and not infringe
on others’ intellectual property; the Company’s ability to scale
its business; the Company’s ability to maintain supplier
relationships and obtain adequate supplies of feedstocks; the
Company’s ability to obtain and retain customers; the Company’s
ability to produce products at competitive rates; the Company’s
ability to execute its business strategy in a very competitive
environment; trends in, and the market for, the price of oil and
gas and alternative energy sources; the impact of inflation on
margins and costs; the volatile nature of the prices for oil and
gas caused by supply and demand, including volatility caused by the
ongoing Ukraine/Russia conflict and/or the Israel/Hamas conflict,
changes in interest rates and inflation, and potential recessions;
the Company’s ability to maintain relationships with partners; the
outcome of pending and potential future litigation, judgments and
settlements; rules and regulations making the Company’s operations
more costly or restrictive; volatility in the market price of
compliance credits (primarily Renewable Identification Numbers
(RINs) needed to comply with the Renewable Fuel Standard (“RFS”))
under renewable and low-carbon fuel programs and emission credits
needed under other environmental emissions programs, the
requirement for the Company to purchase RINs in the secondary
market to the extent it does not generate sufficient RINs
internally, liabilities associated therewith and the timing,
funding and costs of such required purchases, if any; 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, changes in inflation and interest
rates, increased costs of borrowing associated therewith and
potential declines in the availability of such funding; risk of
increased regulation of the Company’s operations and products;
disruptions in the infrastructure that the Company and its partners
rely on; interruptions at the Company’s facilities; unexpected and
expected changes in the Company’s anticipated capital expenditures
resulting from unforeseen and expected required maintenance,
repairs, or upgrades; the Company’s ability to acquire and
construct new facilities; the Company’s ability to effectively
manage growth; decreases in global demand for, and the price of,
oil, due to inflation, recessions or other reasons, including
declines in economic activity or global conflicts; expected and
unexpected downtime at the Company’s facilities; the Company’s
level of indebtedness, which could affect its ability to fulfill
its obligations, impede the implementation of its strategy, and
expose the Company’s interest rate risk; dependence on third party
transportation services and pipelines; risks related to obtaining
required crude oil supplies, and the costs of such supplies;
counterparty credit and performance risk; unanticipated problems
at, or downtime effecting, the Company’s facilities and those
operated by third parties; risks relating to the Company’s hedging
activities or lack of hedging activities; and risks relating to
planned and future divestitures, asset sales, joint ventures and
acquisitions.
Other important factors that may cause actual results and
outcomes to differ materially from those contained in the
forward-looking statements included in this communication are
described in the Company’s publicly-filed reports, including, but
not limited to, the Company’s Annual Report on Form 10-K for the
year ended December 31, 2022, and the Company’s Quarterly Report on
Form 10-Q for the quarter ended September 30, 2023, and future
Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q.
These reports are available at www.sec.gov. The Company cautions
that the foregoing list of important factors is not complete. All
subsequent written and oral forward-looking statements attributable
to the Company or any person acting on behalf of the Company are
expressly qualified in their entirety by the cautionary statements
referenced above. Other unknown or unpredictable factors also could
have material adverse effects on Vertex’s future results. The
forward-looking statements included in this press release are made
only as of the date hereof. Vertex cannot guarantee future results,
levels of activity, performance or achievements. Accordingly, you
should not place undue reliance on these forward-looking
statements. Finally, Vertex undertakes no obligation to update
these statements after the date of this release, except as required
by law, and takes no obligation to update or correct information
prepared by third parties that are not paid for by Vertex. If we
update one or more forward-looking statements, no inference should
be drawn that we will make additional updates with respect to those
or other forward-looking statements.
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IR@vertexenergy.com 203-682-8284
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