UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): April 22, 2020

VERTEX ENERGY, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (866) 660-8156

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

Credit Agreement Amendments

On April 24, 2020, (a) Vertex Energy, Inc. (the “Company”, “we” and “us”), Vertex Energy Operating, LLC, the Company’s wholly-owned subsidiary (“Vertex Operating”), Encina Business Credit, LLC, as agent (the “Agent”) for the lenders party thereto (the “Lenders”), and the Lenders, entered into a Fourth Amendment to Credit Agreement, pursuant to which the Lenders agreed to amend that certain Credit Agreement dated as of February 1, 2017, as amended to date (the “EBC Credit Agreement”); and (b) the Company, Agent, Lenders and Vertex Operating entered into a Fourth Amendment to ABL Credit Agreement, pursuant to which the Lenders agreed to amend that certain ABL Credit Agreement dated as of February 1, 2017, as amended to date (the “Revolving Credit Agreement” and together with the EBC Credit Agreement, the “Credit Agreements”).

The amendments to the Credit Agreements extend the maturity date thereof from February 1, 2021 to February 1, 2022. Additionally, pursuant to the amendment to the Revolving Credit Agreement, the early termination fee payable pursuant to such agreement was amended to provide that (i) if the Revolving Credit Agreement is terminated (or the amounts due thereunder accelerated or become due) prior to February 1, 2021, or (ii) the Company reduces or terminates any portion of the amount which has been committed to be loaned under such agreement prior to February 1, 2021, the Company is required to pay the Lenders an early termination fee equal to 1% of (x) the aggregate amount committed by the Lenders (in the event section (i) above is triggered), or (y) the amount of such reduction (in the event section (ii) above is triggered).

* * * * * * * * *

The foregoing descriptions of the amendments to the Credit Agreements do not purport to be complete and are qualified in their entirety by reference to the Fourth Amendment to Credit Agreement and Fourth Amendment to ABL Credit Agreement, copies of which are attached as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The disclosures regarding the amendments to the Credit Agreements as set forth above in Item 1.01 are incorporated by reference in this Item 2.03.

Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

On April 22, 2020, we received written notice (the “Notification Letter”) from the Listing Qualifications Department of The NASDAQ Stock Market LLC (“Nasdaq”) notifying the Company that it is not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of $1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for a period of thirty (30) consecutive business days. Based on the closing bid price of the Company’s common stock for the thirty (30) consecutive business days prior to the date of the Notification Letter, the Company no longer meets the minimum bid price requirement.

However, given the unprecedented turmoil in U.S. and world financial markets over the last few weeks, Nasdaq has determined to toll the compliance periods for the bid price and market value of publicly held shares requirements through June 30, 2020.

The Notification Letter does not impact the Company’s listing on The Nasdaq Capital Market at this time. The Notification Letter states that the Company has 180 calendar days (beginning after the end of the tolling period, which ends on July 1, 2020), or until December 28, 2020, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance, the bid price of the Company’s common stock must have a closing bid price of at least $1.00 per share for a minimum of 10 consecutive business days. If the Company does not regain compliance by December 28, 2020, an additional 180 days may be granted to regain compliance, so long as the Company meets The Nasdaq Capital Market initial listing criteria (except for the bid price requirement) and notifies Nasdaq in writing of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary. If the Company does not qualify for the second compliance period or fails to regain compliance during the second 180-day period, the Company’s common stock will be subject to delisting, at which point the Company would have an opportunity to appeal the delisting determination to a Hearings Panel.

The Company intends to monitor the closing bid price of its common stock and may, if appropriate, consider implementing available options to regain compliance with the minimum bid price requirement under the Nasdaq Listing Rules. Management remains vigilant with the Company’s business strategy and is continuing to take steps to increase liquidity.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

* Filed herewith. 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, hereunto duly authorized.

EXHIBIT INDEX

* Filed herewith.