As per the terms of the agreement, Vertex Holdings will also contribute its wholly-owned operating subsidiaries Cedar Marine Terminals, Crossroad Carriers, Vertex Recovery, and H&H Oil to Vertex Energy apart from the assets and liabilities.
Vertex Energy will also buy 100% equity interest in Vertex Acquisition, a special purpose entity formed for purchase agreement contemplation and acquire real-estate associated with H&H Oil’s operations from B & S Cowart Family who owns 77% Vertex Holdings.
Vertex Energy will pay $14.8m cash, 4.5m restricted shares of the company’s common stock, $1.7m cash for the real-estate acquired from B & S. Vertex Holdings will also be eligible to receive earn-out payments for each of the three one-year periods following the closing date of the transaction.
Vertex Energy director and Related Party Transaction Committee chairman David Phillips said the acquisition is a critical step in the growth of the company.
"As a result of this deal, we will operate a vertically integrated company that spans the full value chain within our industry, from feedstock collection through processing and end-product sales," Phillips added.
"We believe that the accretive nature of this acquisition and the scale of the combined companies will be beneficial to our shareholders.
"In addition, the combination eliminates the related party transactions between Holdings and Vertex Energy, which have often been a source of confusion in our disclosures to the investment community."
The company is expecting to close the deal in September 2012 following the approval of all the necessary closing conditions.
