8-K

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: December 9, 2014

Date of Earliest Event Reported: December 4, 2014

VERTEX ENERGY, INC.

(Exact name of registrant as specified in its charter)

Nevada	001-11476	94-3439569
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1331 Gemini Street

Suite 250

Houston, Texas 77058

(Address of principal executive offices)(Zip Code)

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:

[__] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[__] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[__] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[__] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

On December 4 and 5, 2014, Vertex Energy, Inc. (the “Company”, “we”, “us” or “Vertex”) entered into amendments to our credit agreements with our senior lenders, a subscription agreement with our Chief Executive Officer, Chairman and largest shareholder, and an amendment to our Asset Purchase Agreement with Heartland Group Holdings, LLC (“Heartland”) which enabled us to complete the previously announced and pending acquisition of the assets of Heartland, which agreements and transactions are described in greater detail throughout this Current Report on Form 8-K, and which acquisition closed on December 5, 2014.  Our entry into the Asset Purchase Agreement and the original terms thereof were described in greater detail in the Current Report on Form 8-K, filed with the Securities and Exchange Commission (the “Commission”) on October 28, 2014.

First Amendment to Credit and Guaranty Agreement with Goldman Sachs Bank USA

In connection with the closing of the Purchase Agreement (as defined and described in greater detail under “Item 2.01Completion of Acquisition or Disposition of Assets” below) with Heartland, we entered into a First Amendment to Credit and Guaranty Agreement with Goldman Sachs Bank USA (“Goldman” and the “Goldman Amendment”).  The Goldman Amendment amended that certain Credit and Guaranty Agreement entered into between the Company and Goldman dated as of May 2, 2014 (as amended and modified to date, the “Goldman Credit Agreement”).  The Goldman Credit Agreement is described in greater detail in the Form 8-K filed by the Company with the Commission on May 6, 2014.

Pursuant to the Goldman Amendment, the EBITDA of Vertex Refining OH, LLC (“Vertex OH”), a wholly-owned subsidiary of Vertex Energy Operating, LLC (“Vertex Operating”), a wholly-owned subsidiary of the Company, which acquired the assets of Heartland in connection with the closing of the Purchase Agreement, is excluded from the calculation of adjusted EBITDA for the purposes of the Goldman Credit Agreement (which calculation ties to certain required ratios of debt leverage and other financial covenants set forth in greater detail in the Goldman Credit Agreement); Goldman specifically consented to the acquisition of Heartland (and the sale of $1.5 million in securities to our Chief Executive Officer, as described below); Goldman agreed that the funds raised in connection with the sale of securities to certain trusts beneficially owned by Benjamin P. Cowart, our Chief Executive Officer and Chairman (as described below under “Sale of Shares and Warrants to our Chief Executive Officer”), would not be required to be used to repay amounts due under the Goldman Credit Agreement; the Company is required to provide Goldman certain monthly and quarterly financial information regarding Vertex OH, similar to what information it already provides for Vertex Refining NV, LLC, a wholly-owned subsidiary of Vertex Operating; various other changes to the Goldman Credit Agreement were effected to bind Vertex OH to similar covenants and requirements as the Company’s other operating subsidiaries, including to restrict Vertex OH’s ability to incur indebtedness, create liens, obtain equity investments, and make certain investments; and the Goldman Amendment further required that Vertex OH maintain not less than $500,000 in cash at all times. Furthermore, the Goldman Amendment provides that the Company is not authorized to make any “earn-out” payment under the Heartland Purchase Agreement, if an event of default exists under the Goldman Credit Agreement or if such payment would create an event of default under the Goldman Credit Agreement.  The Goldman Amendment also included a release by the Company and its subsidiaries in favor of Goldman and its representatives and assigns.

As of the date of the parties’ entry into the Goldman Amendment, the amount owed to Goldman by the Company under such facility was $39,400,000 (not including fees and other amounts).

No terms or conditions of the Goldman Amendment waived or released the Company from the defaults which had occurred under such Goldman Credit Agreement as of the date of the parties’ entry into such agreement, which are described in greater detail under “Item 3.  Defaults Upon Senior Securities” in the Company’s Quarterly Report on Form 10-Q for the three months ended September 30, 2014, filed with the Commission on November 14, 2014, other than specifically in connection with the approval by Goldman of the Company’s consummation of the Heartland Purchase Agreement.

The foregoing description of the Goldman Amendment does not purport to be complete and is qualified in its entirety by reference to the Goldman Amendment, a copy of which is filed herewith as Exhibit 10.3 and incorporated in this “Item 1.01. Entry Into a Material Definitive Agreement”, by reference.

First Amendment to Amended and Restated Credit Agreement with Bank of America, N.A.

In connection with the closing of the Purchase Agreement (as defined and described in greater detail under “Item 2.01Completion of Acquisition or Disposition of Assets”, below), we entered into a First Amendment to Amended and Restated Credit Agreement with Bank of America, N.A. (the “BOA Amendment” and “BOA”).  The BOA Agreement is described in greater detail in the Form 8-K filed by the Company with the Commission on May 6, 2014.

Pursuant to the BOA Amendment, the Company acknowledged and confirmed that BOA is not required to extend any credit to the Company while any defaults are continuing under the Amended and Restated Credit Agreement dated as of May 3, 2014, by and between the Company and BOA (as amended and modified to date, the “BOA Credit Agreement”), and that various defaults had occurred under the BOA Credit Agreement as of the date of the parties’ entry into the BOA Amendment, which are described in greater detail under “Item 3. Defaults Upon Senior Securities” in the Company’s Quarterly Report on Form 10-Q for the three months ended September 30, 2014, filed with the Commission on November 14, 2014.  The BOA Amendment, which did not waive or release the Company from any of the prior defaults which had occurred under the BOA Credit Agreement, provided that Vertex OH is to be excluded from the calculation of certain required ratios and other financial covenants set forth in greater detail in the BOA Credit Agreement; and provided that Vertex OH would be bound by various representations, warranties, covenants and prohibitions set forth in the BOA Credit Agreement which previously applied to the Company’s other operating subsidiaries, including requiring Vertex OH to maintain at least $500,000 in cash at all times. Additionally pursuant to the BOA Amendment, BOA consented to the Company’s acquisition of Heartland (and the sale of $1.5 million in securities to our Chief Executive Officer, as described below). The BOA Amendment also included a release by the Company and its subsidiaries in favor of BOA and its representatives and assigns.

The foregoing description of the BOA Amendment does not purport to be complete and is qualified in its entirety by reference to the BOA Amendment, a copy of which is filed herewith as Exhibit 10.4 and incorporated in this “Item 1.01. Entry Into a Material Definitive Agreement”, by reference.

Second Amendment to Asset Purchase Agreement

On December 5, 2014, we entered into a Second Amendment to Asset Purchase Agreement relating to the Asset Purchase Agreement entered into with various parties including Heartland on October 21, 2014, which is described in greater detail under “Item 2.01Completion of Acquisition or Disposition of Assets” below.

Sale of Shares and Warrants to our Chief Executive Officer

On December 4, 2014, we entered into two Subscription Agreements and sold 244,299 shares of restricted common stock and five year warrants to purchase 109,934 shares of common stock each to The Benjamin Paul Cowart 2012 Grantor Retained Annuity Trust and The Shelley T. Cowart 2012 Grantor Retained Annuity Trust, in consideration for $750,000 each (or $1.5 million in aggregate).  The trusts are controlled by and for the benefit of Benjamin P. Cowart, the Chief Executive Officer, Chairman and largest shareholder of the Company and his wife and as such, Mr. Cowart is deemed to beneficially own the securities acquired.  The closing of the transactions contemplated by the Subscription Agreements was contingent on the closing of the Heartland acquisition (described in “Item 2.01Completion of Acquisition or Disposition of Assets” below), and closed concurrently with the Heartland acquisition on December 5, 2014.

The shares and warrants (representing 45% warrant coverage in connection with the purchase of the shares) were sold for $3.07 per share and warrant (a premium to the $3.01 closing price of the Company’s common stock on December 4, 2014 ($3.01 per share)).  The warrants (the “Warrants”) were evidenced by Common Stock Purchase Warrants and have a term of five years, an exercise price of $3.01 per share and cashless exercise rights beginning six months after the date of the grant of the Warrants, to the extent that the shares of common stock issuable upon exercise of such Warrants are not registered with the Commission.  The subscribers were also provided piggy-back registration rights in the event that we file a primary or secondary registration statement in the five years following the closing of the acquisition.

The funds raised pursuant to the sale of securities will be used as working capital for the Heartland Business, which we acquired pursuant to the closing of the Purchase Agreement with Heartland (as described in greater detail below under “Item 2.01Completion of Acquisition or Disposition of Assets”).

The foregoing descriptions of the Subscription Agreements and Warrant Agreements do not purport to be complete and are qualified in their entirety by reference to the Form of Subscription Agreement and Warrant Agreements, copies of which are filed herewith as Exhibits 10.2, 4.1 and 4.2, respectively, and incorporated in this “Item 1.01. Entry Into a Material Definitive Agreement”, by reference.

ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.

On December 5, 2014, we completed the closing contemplated under the Purchase Agreement (described below).

On the same date, we entered into a Second Amendment to Asset Purchase Agreement (the “Second Amendment”), which amended the October 21, 2014 Asset Purchase Agreement by and among the Company, Vertex Operating, Vertex OH, and Heartland, which was previously amended by the First Amendment to Purchase Agreement dated November 26, 2014 (the “First Amendment” and the Asset Purchase Agreement as amended by the First Amendment and Second Amendment, the “Purchase Agreement”).

Pursuant to the Second Amendment, the parties agreed that any amount due to Heartland in consideration for inventory on hand which was purchased at closing, based on a preliminary valuation of such inventory by the parties, would be paid in shares of the Company’s restricted common stock, based on the volume weighted average prices of the Company’s common stock on the NASDAQ Capital Market on the ten (10) trading days (the “VWAP”) immediately prior to closing (the “Inventory Purchase”), which totaled $3.56 (the “Closing VWAP”), provided that the post-closing adjustment which is required to take place 60 days after closing, based on the actual physical inventory delivered at closing, is also payable in shares of restricted common stock (if amounts are payable by the Company in connection with such reconciliation) based on the then VWAP (the “Inventory True-Up”); that the Reimbursement for Operating Losses (defined below), payable at closing would be paid in shares of the Company’s restricted common stock, based on the Closing VWAP; that Heartland’s majority equity owner (Warren Distribution, Inc. (“Warren”)) would purchase a minimum of 110,000 gallons per week (on average) of finished base oil (440,000 per month) from Vertex OH, at a purchase price computed in a manner which is substantially consistent with the historical pricing of the Heartland Business (defined below); the Company agreed to register all shares of Company common stock issued to Heartland in connection with the closing of the acquisition, or pursuant to the Second Amendment, which shares are described in greater detail below; the parties agreed to cap the indemnification liability for certain breaches of the Purchase Agreement to $2 million in aggregate, and to further provide that if any indemnification obligations are owed by the Company, Vertex OH or Vertex Operating, that such obligations can be satisfied by the issuance of shares of the Company’s common stock based on a valuation of $8.78 per share; and the Company agreed to waive certain closing conditions set forth in the original purchase agreement relating to among other things, the delivery of certain consents and assignments originally due at closing.  Finally, the Second Amendment provided that Heartland would be required to conduct additional environmental studies on certain property located in Norwalk, Ohio, that if remediation activities were required, the Company would be required to pay the lesser of one-half of such remediation costs or $200,000, and that title to such property would not transfer to Vertex OH at closing, but that instead Vertex OH would lease the property until such time as any environmental issues have been remediated.  Any out of pocket costs incurred by Heartland in connection with remediation activities on such property in excess of $200,000 reduce the indemnification cap applicable to Heartland described above.

Prior to the closing of the Purchase Agreement, Heartland was in the business of operating an oil re-refinery and, in connection therewith, collecting, aggregating and purchasing used lubricating oils and re-refining such oils into processed oils and other products for the distribution, supply and sale to end-customers (collectively, the “Heartland Business”).

In connection with the closing of the Purchase Agreement, we acquired substantially all of the assets of Heartland related to and used in the operations of the Heartland Business, including raw materials, finished products and work-in-process, equipment and other fixed assets, customer lists and marketing information, the name ‘Heartland’ and other related trade names, Heartland’s real property relating to its used oil refining facility located in Columbus, Ohio, used oil storage and transfer facilities located in Columbus, Zanesville and Norwalk, Ohio (provided that the acquisition of the Norwalk, Ohio location is subject to the terms and conditions of the Second Amendment, described above), and leases related to storage and transfer facilities located in Zanesville, Ohio, Mount Sterling, Kentucky, and Ravenswood, West Virginia (collectively, the “Heartland Assets”) and assumed certain liabilities of Heartland associated with certain assumed and acquired agreements.  The main assets excluded from the purchased assets pursuant to the Purchase Agreement were Heartland’s cash and cash equivalents, receivables, certain prepaid expenses, refunds and related claims, rights to certain tax refunds, certain assets used in the operations of Heartland which are used more than incidentally by Warren in connection with the operation of its other businesses and certain real property assets.

The purchase price paid in consideration for the Heartland Assets was the assumption of the assumed liabilities and an aggregate of 2,201,601 shares of restricted common stock (the “Heartland Shares”), representing a total of 1,189,637 shares valued at $8,276,792, as agreed pursuant to the terms of the original Purchase Agreement, 248,091 shares which were due in consideration for the purchase of various inventory of Heartland acquired by the Company at the closing in connection with the Inventory Purchase, valued at $882,285, and a total of 763,873 shares due in consideration for the Reimbursement of Operating Losses (described below). A total of 150,000 shares of restricted common stock issued at closing will be held in escrow and used to satisfy indemnification claims (the “Escrow Shares”).  Additionally, as described above, an Inventory True-Up is to occur 60 days after closing which may either increase or decrease the purchase price paid by the Company in connection with the difference between the expected inventory delivered and actual inventory delivered by Heartland at closing.

The Escrow Shares are to be held in escrow to satisfy indemnification claims for 24 months following the closing; provided that Heartland has the option at any time to acquire such Escrow Shares and instead place cash in such escrow account, upon the payment into the escrow account of $333,333 in cash for each 50,000 of Escrow Shares acquired by Heartland.  Any claims made against the Escrow Shares pursuant to the indemnification provisions of the Purchase Agreement result in the cancellation of Escrow Shares equal in value to the amount of the applicable claim divided by the VWAP of the Company’s common stock ending on and including the trading day immediately preceding the date of such applicable claim.

Pursuant to a Consulting Agreement previously entered into with Heartland in July 2014, Vertex Operating agreed to provide consulting services to Heartland while the parties negotiated the definitive terms of the Purchase Agreement (the “Consulting Agreement”), and to reimburse Heartland for its operating losses (on a cash basis net of interest, depreciation, corporate overhead expenses and insurance proceeds received), which totaled $2,716,561 as of closing (the “Reimbursement for Operating Losses”).

Vertex OH and Vertex Operating also agreed to share equally with Heartland in the costs of certain projects undertaken by Heartland prior to closing, provided that Heartland was not required to pay more than $788,500 of its costs associated with such project costs which are estimated to total approximately $1.6 million.  In connection therewith, following the closing, Vertex OH will first pay, up to the amount expended by Heartland as of closing for such costs ($529,449) and the remaining amount of such projects will be split equally by Vertex OH and Heartland.  All projects undertaken following closing, if any, are in the sole discretion of Vertex OH. 

Heartland also has the right pursuant to the terms of the Purchase Agreement to earn additional earn-out consideration of up to a maximum of $8,276,792, based on total EBITDA related to the Heartland Business during the twelve month period beginning on the first day of the first full calendar month commencing on or after the first anniversary of the closing (the “Earnout Period”), as follows (as applicable, the “Contingent Payment”):

EBITDA generated during Earnout Period	Contingent Payment Due
Less than $1,650,000	$0
At least $1,650,000	$4,138,396
More than $1,650,000 and less than $3,300,000	Pro-rated between $4,138,396 and $8,276,792
$3,300,000 or more	$8,276,792

Any Contingent Payment due is payable 50% in cash and 50% in shares of the Company’s common stock based on VWAP commencing on the trading day immediately following the last day of the Earnout Period and ending on such tenth trading day thereafter.  Additionally, the amount of any Contingent Payment is reduced by two-thirds of the cumulative total of required capital expenditures incurred at Heartland’s refining facility in Columbus, Ohio, which are paid or funded by Vertex OH after the closing, not to exceed $866,667, which capital expenditures are estimated to total $1.3 million in aggregate.

Notwithstanding the above, the maximum number of shares of common stock to be issued pursuant to the Purchase Agreement (including those shares sold in connection with the Subscription Agreements described in “Item 1.01. Entry Into a Material Definitive Agreement” above under “Sale of Shares and Warrants to our Chief Executive Officer”) cannot (i) exceed 19.9% of the outstanding shares of common stock outstanding on October 21, 2014, (ii) exceed 19.9% of the combined voting power of the Company on October 21, 2014, or (iii) otherwise exceed such number of shares of common stock that would violate applicable listing rules of the NASDAQ Stock Market in the event the Company’s stockholders do not approve the issuance of such shares (the “Share Cap”).  In the event the number of shares to be issued exceeds the Share Cap, then Vertex OH is required to instead pay any such additional consideration in cash or obtain the approval of the Company’s stockholders under applicable rules and requirements of the NASDAQ Capital Market for the additional issuance of shares.

Additionally, we are required to file a registration statement within 90 days of the closing registering all of the shares of the Company’s common stock issued to Heartland as of such filing date and use commercially reasonable efforts to obtain effectiveness of the registration statement within 90 days of the closing date if the SEC does not review the registration statement or within 120 days if the SEC does review the registration statement filing.   Pursuant to the Purchase Agreement, Heartland agreed to not sell more than 50,000 shares of the Company’s common stock issued to it each week, if otherwise permitted pursuant to applicable law and regulation.

Finally, at the closing, Robert N. Schlott, the Chief Executive Officer of Warren, entered into a non-competition agreement whereby he agreed not to compete against Vertex OH (or its affiliates) in connection with the Heartland Business, or to solicit active customers of the Heartland Business, among other things, for a period of three years from the closing.

The foregoing description of the Purchase Agreement, First Amendment, Second Amendment and Consulting Agreement do not purport to be complete and are qualified in their entirety by reference to the Purchase Agreement, First Amendment, Second Amendment and Consulting Agreement, copies of which are attached hereto or incorporated by reference herein, as applicable, as Exhibits 2.1, 2.2, 2.3 and Exhibit 10.1, respectively, to this Current Report on Form 8-K and incorporated in this “Item 2.01 Completion of Acquisition or Disposition of Assets” by reference.

ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES.

As described in “Item 2.01Completion of Acquisition or Disposition of Assets” above, we issued 2,201,601 shares of restricted common stock to Heartland in connection with the closing of the Purchase Agreement and may be required to issue additional shares in connection with an Inventory True-Up, Contingent Payments subject to an earn-out, and to satisfy indemnification rights described in greater detail above.

As described in “Sale of Shares and Warrants to our Chief Executive Officer” in “Item 1.01. Entry Into a Material Definitive Agreement”, above, we sold 244,299 shares of restricted common stock and five year Warrants to purchase 109,934 shares of common stock each (488,598 shares and Warrants to purchase 219,868 shares in aggregate) to The Benjamin Paul Cowart 2012 Grantor Retained Annuity Trust and The Shelley T. Cowart 2012 Grantor Retained Annuity Trust, in consideration for $750,000 (or $1.5 million in aggregate), trusts controlled by and for the benefit of Benjamin P. Cowart, the Chief Executive Officer, Chairman and largest shareholder of the Company and his wife, which securities Mr. Cowart is deemed to beneficially own.  In the event the Warrants are exercised in full (and notwithstanding any potential cashless exercise), each holder is due 109,934 shares of common stock in connection with such exercise and upon payment of the aggregate $330,901 exercise price of such Warrants (219,868 shares and $661,802 in aggregate).

The issuances and sales described above were exempt from registration pursuant to Section 4(2) and/or Rule 506 of Regulation D of the Securities Act of 1933, as amended (the “Securities Act”), since the foregoing issuances did not involve a public offering, the recipients were “accredited investors”, the recipients acquired the securities for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof. The securities were offered without any general solicitation by the Company or its representatives. The securities have not been registered under the Securities Act and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act and any applicable state securities laws.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(a)  Financial Statements of Businesses Acquired.

Financial statements relating to the acquisition of the Heartland Assets are not included in this Current Report on Form 8-K, and to the extent required by this Item 9.01, will be filed by amendment to this Current Report on Form 8-K within seventy-one (71) calendar days from the date that this Current Report on Form 8-K is required to be filed.

(b)  Pro Forma Financial Information.

Pro forma financial information relating to the acquisition of Heartland Assets are not included in this Current Report on Form 8-K, and to the extent required by this Item 9.01, will be filed by amendment to this Current Report on Form 8-K within seventy-one (71) calendar days from the date that this Current Report on Form 8-K is required to be filed.

Exhibit No.	Description
2.1(1)	Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy, Inc. and Heartland Group Holdings, LLC (October 21, 2014)
2.2(2)	First Amendment to Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy, Inc. and Heartland Group Holdings, LLC (November 26, 2014)
2.3*	Second Amendment to Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy, Inc. and Heartland Group Holdings, LLC (December 5, 2014)
4.1*	Common Stock Purchase Warrant to purchase 109,934 shares of common stock of the Company held by The Benjamin Paul Cowart 2012 Grantor Retained Trust (December 4, 2014)
4.2*	Common Stock Purchase Warrant to purchase 109,934 shares of common stock of the Company held by The Shelley T. Cowart 2012 Grantor Retained Trust (December 4, 2014)
10.1(1)	Consulting Agreement between Heartland Group Holdings, LLC and Vertex Energy Operating, LLC (July 28, 2014)
10.2*	Form of Subscription Agreement dated December 4, 2014
10.3*	First Amendment to Credit and Guaranty Agreement between Vertex Energy Operating, LLC, Vertex Energy, Inc. and Goldman Sachs Bank USA (December 5, 2014)
10.4*	First Amendment to Amended and Restated Credit Agreement between Vertex Energy Operating, LLC, Vertex Energy, Inc. and Bank of America, N.A. (December 5, 2014)
99.1**	Press Release Dated December 9, 2014

* Filed herewith.

** Furnished herewith.

(1) Filed as an exhibit to the Company’s Current Report on Form 8-K, filed with the Commission on October 28, 2014, and incorporated herein by reference.

(2) Filed as an exhibit to the Company’s Current Report on Form 8-K, filed with the Commission on December 1, 2014, and incorporated herein by reference.

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.

	VERTEX ENERGY, INC.
Date: December 9, 2014	By: /s/ Chris Carlson
	Chris Carlson
	Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description
2.1(1)	Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy, Inc. and Heartland Group Holdings, LLC (October 21, 2014)
2.2(2)	First Amendment to Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy, Inc. and Heartland Group Holdings, LLC (November 26, 2014)
2.3*	Second Amendment to Asset Purchase Agreement by and among Vertex Energy Operating, LLC, Vertex Refining OH, LLC, Vertex Energy, Inc. and Heartland Group Holdings, LLC (December 5, 2014)
4.1*	Common Stock Purchase Warrant to purchase 109,934 shares of common stock of the Company held by The Benjamin Paul Cowart 2012 Grantor Retained Trust (December 4, 2014)
4.2*	Common Stock Purchase Warrant to purchase 109,934 shares of common stock of the Company held by The Shelley T. Cowart 2012 Grantor Retained Trust (December 4, 2014)
10.1(1)	Consulting Agreement between Heartland Group Holdings, LLC and Vertex Energy Operating, LLC (July 28, 2014)
10.2*	Form of Subscription Agreement dated December 4, 2014
10.3*	First Amendment to Credit and Guaranty Agreement between Vertex Energy Operating, LLC, Vertex Energy, Inc. and Goldman Sachs Bank USA (December 5, 2014)
10.4*	First Amendment to Amended and Restated Credit Agreement between Vertex Energy Operating, LLC, Vertex Energy, Inc. and Bank of America, N.A. (December 5, 2014)
99.1**	Press Release Dated December 9, 2014

* Filed herewith.

** Furnished herewith.

(1) Filed as an exhibit to the Company’s Current Report on Form 8-K, filed with the Commission on October 28, 2014, and incorporated herein by reference.

(2) Filed as an exhibit to the Company’s Current Report on Form 8-K, filed with the Commission on December 1, 2014, and incorporated herein by reference.

EX-2.3

Exhibit 2.3

SECOND AMENDMENT TO

ASSET PURCHASE AGREEMENT

This SECOND AMENDMENT ("Amendment") to the Asset Purchase Agreement (the "Purchase Agreement") made and entered into effective as of October 21, 2014, and amended by a First Amendment dated as of November 26, 2014, by and among VERTEX ENERGY OPERATING, LLC, a Texas limited liability company ("Vertex"), VERTEX REFINING OH, LLC, an Ohio limited liability company and a wholly-owned subsidiary of Vertex ("Buyer"), VERTEX ENERGY, INC., a Nevada corporation and the owner of 100% of the outstanding equity interests in Vertex ("Parent"), HEARTLAND GROUP HOLDINGS, LLC, a Delaware limited liability company ("Seller"), and WARREN DISTRIBUTION, INC., a Nebraska corporation ("Warren"), is entered into effective as of December 5, 2014 by each of the foregoing parties to the Purchase Agreement. Capitalized terms not otherwise defined in this Second Amendment will have the meanings given to them in the Purchase Agreement.

RECITALS

A.           Each of the undersigned parties has entered into the Purchase Agreement pursuant to which Buyer has agreed to purchase and acquire from Seller certain of the assets, claims and rights of Seller related to the operation of the Business and Buyer has agreed to assume and perform certain liabilities and obligations of Seller related to the operation of the Business, all on the terms and conditions as set forth in the Purchase Agreement.

B.           The undersigned parties to the Purchase Agreement desire to amend the Purchase Agreement in accordance with the terms and conditions of this Amendment.

AGREEMENTS

In consideration of the mutual promises set forth in the Purchase Agreement and below, the undersigned agree to amend the provisions of the Purchase Agreement as follows:

1.           Adjustments to Closing Consideration.

(a)           Inventory.  The Parties agree that any amount due to Seller from Buyer under the terms of Section 5.02(a)(iv) or Section 5.02(b) shall not be paid in cash by Buyer to Seller but rather shall be paid by delivery of a stock certificate representing that number of shares of Vertex Common Stock equal to the amount due to Seller divided by the Vertex Inventory VWAP (as defined below), with such number of shares being rounded up or down to the nearest whole number of shares of Vertex Common Stock.  Such shares of Vertex Common Stock, if due under the terms of the Purchase Agreement, shall be registered in the name of Seller and shall bear the legends and restrictions, as applicable, and be subject to the same rights, conditions and limitations as the Closing Stock Consideration (which for purposes of clarity are set forth in Section 9.18 of the Purchase Agreement).  For purposes of this Amendment, "Vertex Inventory VWAP" means the volume-weighted average of the regular session closing prices per share of the Vertex Common Stock on the NASDAQ Capital Market for the ten (10) consecutive trading days ending on the trading day immediately preceding the date upon which such payment under Section 5.02(a)(iv) or Section 5.02(b) is due.  Seller shall be deemed to have automatically recertified the representations and warranties made by Seller pursuant to Section 7.25 of the Purchase Agreement in connection with any issuance of Vertex Common Stock pursuant to this Section 1(a).

1

(b)           Interim Funding.  The Parties agree that Buyer shall pay the amount of the operating losses due at Closing as contemplated by Section 9.16(b) of the Purchase Agreement, in shares of Vertex Common Stock in lieu of cash, by delivery of a stock certificate representing that number of shares of Vertex Common Stock equal to the aggregate amount of the Seller operating losses contemplated by Section 9.16(b) of the Purchase Agreement divided by the Vertex Closing VWAP, with such number of shares being rounded up or down to the nearest whole number of shares of Vertex Common Stock.  Such shares of Vertex Common Stock may be netted with the number of shares of Vertex Common Stock due pursuant to Section 1(a) above, if any, and shall be registered in the name of Seller and shall bear the legends and restrictions, as applicable, and be subject to the same rights, conditions and limitations as the Closing Stock Consideration (which for purposes of clarity are set forth in Section 9.18 of the Purchase Agreement). For purposes of this Amendment, "Vertex Closing VWAP" means the volume-weighted average of the regular session closing prices per share of the Vertex Common Stock on the NASDAQ Capital Market for the ten (10) consecutive trading days ending on the trading day immediately preceding the Closing Date.

2.           Purchase and Sale of Seller Inventory.  For a period of twelve (12) months following the Closing Date (the "Inventory Purchase Term"), Seller and Warren hereby covenant and agree that Buyer shall sell to Warren and Warren shall purchase from Buyer a minimum of One Hundred Ten Thousand (110,000) gallons per week (on average) of finished base oil (the "Product") for delivery to Warren's designated manufacturing facility(ies) at the Finished Base Oil Price (as defined below); provided, however, Warren shall purchase from Buyer a minimum of 440,000 gallons per month during each month during the Inventory Purchase Term.  Upon delivery of such Product to Warren, Warren shall pay Buyer such Finished Base Oil Price within one Business Day of receipt of the invoice therefor.

(a)           For purposes of this Agreement, the "Finished Base Oil Price" shall mean a price computed in a manner which is substantially consistent with the historical pricing provided by the Business to Warren (including all applicable discounts), for the same or substantially equivalent Product in terms of quality and quantity.  In the event Warren has received an offer to purchase the same or substantially equivalent Product from a third party for a specific period during the Inventory Purchase Term, then Warren shall notify Buyer of such other offer (and provide Buyer with reasonable documentation supporting such offer) and Buyer shall have the option to sell the Product to Warren at such reduced cost. If Buyer does not sell Warren the Product at such reduced price, then Warren shall be released from its obligation to purchase the Product from Buyer for the amount of Product during such period, but the amount of such product so purchased shall reduce Warren's purchase obligation set forth in this Section of the Amendment.

(b)           The Finished Base Oil Price shall not include any taxes, tariffs, duties, and other charges that may be applicable to the sale and the purchase of the Product. Unless otherwise stated herein, Buyer shall be liable for all taxes, excises, and other governmental charges levied or applicable to the production, storage, sale, or delivery of the Product hereunder from Buyer to Warren (but not any such taxes, excises, and other governmental charges applicable to Warren's subsequent use, processing or sale of such Product) unless a proper exemption certificate is furnished.

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(c)           Buyer agrees that with respect to its production and shipment of the Product, Buyer shall not ship to any other customer until such time as it has adequately provided for the supply of the minimum amount of Product to be furnished to Warren.  Notwithstanding the above purchase minimum requirements, if at any time and from time to time, Buyer cannot adequately supply such Product pursuant to the terms hereunder, Warren may have such Product supplied by a third party and Warren's purchase obligations hereunder shall be reduced accordingly.  With respect to all Product purchased from Buyer by Warren, Buyer warrants that the Product shall be manufactured to meet the specifications set forth on Exhibit 1, which is attached hereto and incorporated herein by reference.  The parties agree that all Product purchased pursuant to this Amendment will be subject to final inspection and approval by Warren. Such inspection will be made within a reasonable time after delivery of the Product irrespective of the date of payment therefore but in no event later than fifteen (15) days after the Product is received by Warren at the delivery point. Warren shall have no obligation to pay for any Product not in conformity to the specifications set forth in the attached Exhibit 1, and the failure to supply such Product in conformity to such specification shall constitute a Party Default (as defined in Section 2(g) below) by Buyer under this Section.

(d)           The Product shall be deemed to be delivered and title to the Product and all risk of loss shall pass from Buyer to Warren at the point at which the Product passes the final flange connection between the delivery hose and the receiving equipment at Warren's facility.

(e)           With respect to this Section 2, in the event (i) a party breaches any representation, warranty, covenant or other obligation of this section, including but not limited to, the failure of Buyer to deliver the minimum amount of Product to Warren at the price and quality set forth herein or the failure of Warren to purchase such minimum amount of Product in accordance with terms hereof; (ii) either party becomes unable to pay its bills as they become due in the ordinary course; (iii) a trustee or receiver of such party's property is appointed; (iv) a party makes an assignment for the benefit of creditors; (v) a petition in bankruptcy is filed by or against the party which is not terminated within sixty (60) days; or (vi) a party terminates or liquidates its business (any of which shall be a "Party Default") the other party shall have the option to terminate its obligations under this section of the Amendment, without further obligation, in the event that such Party Default is not cured within ten (10) days following written notification of such party's exercise of its option to terminate hereunder.  For the avoidance of doubt, the parties agree that an event constituting force majeure shall not be an excuse or relief to any party's obligations under this section of this Amendment. The termination of a party's obligations under this section will not relieve either party of any liability it may have to the other arising out of or related to acts or omissions prior to such termination or expiration.  Notwithstanding the foregoing, and irrespective of any cure, in the event a Party Default occurs three (3) times, no ability to cure such Party Default shall thereafter exist and the non-defaulting party shall have the immediate right to terminate the provisions of this section of the Amendment upon written notice to the defaulting party.

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3.           Amendment to Purchase Agreement. The requirement to file the Registration Statement as set forth in Section 9.18 of the Purchase Agreement shall be amended to include the Closing Stock Consideration as well as any additional shares issued under this Amendment, and Section 9.18(a)(i) of the Purchase Agreement (the "Seller's Shares") is hereby amended to read as follows (provided that there shall not be any other modifications or amendments to Section 9.18(a) other than as described below):

"Within ninety (90) days following the Closing, Parent shall prepare and file with the SEC one or more registration statements under the Securities Act on Form S-3 or on such other registration statement as is then available to Parent (together with the prospectus and any amendments, including post-effective amendments, or supplements thereto, and all exhibits and all material incorporated by reference therein, each a "Registration Statement"), in form and substance reasonably acceptable to Seller and its legal counsel, providing for the registration for resale by Seller under the Securities Act of at least the number of  shares of the Vertex Common Stock issued to Seller pursuant to this Agreement (but in no event shall such number of shares exceed the number of shares of Vertex Common Stock actually issued to Seller or Warren at Closing or under this Amendment) (the "Registered Shares"). Parent shall use its commercially reasonable efforts to cause the Registration Statement to be declared effective under the Securities Act as soon as possible and, in any event, within ninety (90) days following the Closing, if the SEC does not review the Registration Statement or within one hundred twenty (120) days following the Closing, if the SEC does review the Registration Statement (as applicable, the "Effectiveness Date"). At such time as the registration statement becomes effective, Parent will keep such registration statement continuously effective and will comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement until the earlier of such time as all of such securities have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof set forth in such registration statement or until such shares have been sold or may be sold without the requirement to be in compliance with Rule 144(c)(1) and otherwise without volume or other restriction pursuant to Rule 144 of the Securities Act.  Notwithstanding anything to the contrary in this Section 9.18(a), in the event that the SEC does not permit Parent to register all of the Registered Shares pursuant to this Agreement, Parent shall promptly notify Seller or Warren, as applicable, and thereafter register in the initial applicable registration statement the maximum number of shares as permitted by the SEC. In the event that the SEC does not permit Parent to register all of the Registered in the initial applicable registration statement, Parent shall prepare and file subsequent registration statements to register the shares that were not registered in the initial applicable registration statement as promptly as practicable and in a manner permitted by the SEC. Seller and Warren, as applicable, shall provide Parent with such information to be included in the Registration Statement as it may reasonably request.  Parent shall make any and all filings and take any and all other actions that may be necessary, appropriate, or advisable under the applicable state securities laws in furtherance of the offer and sale of the applicable shares of the Vertex Common Stock issued hereunder.  Parent shall furnish, without charge, and on a timely basis, to each holder of the Vertex Common Stock named as a selling shareholder in the Registration Statement such number of copies of the Registration Statement (including the prospectus), each amendment and supplement thereto, and such other documents as such holder may reasonably request in order to facilitate the disposition of the shares of Vertex Common Stock included therein owned by such holder, including any opinion of counsel reasonably requested by Parent's transfer agent to effect a resale of shares under the Registration Statement, and Parent hereby consents to the use of each prospectus and such other documents by each such holder in connection with the offering and sale of the shares of the Vertex Common Stock covered by the Registration Statement.  Parent agrees to cause the shares of Vertex Common Stock (whether included in the Registration Statement or not) to be listed on each securities exchange or market where Parent securities of the same class are listed."

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4.           Share Cap.  The Share Cap set forth in Section 9.18(h) of the Purchase Agreement shall apply to all shares of Vertex Common Stock issuable pursuant to the terms of this Amendment.

5.           Subject to Applicable Law.  Notwithstanding the above, the requirement of Parent to register, and timely register, the Vertex Common Stock issuable hereunder shall be subject in all cases to the rules and regulations of the SEC and the SEC's interpretation of such rules and regulations and Parent shall not be required to take any steps or attempt to register any Vertex Common Stock which Parent or its legal counsel reasonably believe are contrary to or prohibited by the rules and regulations of the SEC.

6.           Indemnification Cap.  The nature and amount of the limitation set forth in Section 11.05(c) of the Purchase Agreement is changed.  As such, Section 11.05(c) of the Agreement is amended in its entirety to the following:

"(c)           Cap.  Except with respect to claims for breaches of or inaccuracies in the Fundamental Representations, or any claim pursuant to Section 11.01(b), (c) or (d) or Section 11.02(b), (c), (e), (f) or (g) (as to which the limitations in this Section 11.05(c) shall not apply), the aggregate amount of all losses paid by an Indemnifying Party under this Section 11 shall not exceed Two Million Dollars ($2,000,000) (the "Cap"), and may,  in the case of any payment due to a Buyer Indemnified Party, be satisfied by the payment of that number of Vertex Common Stock held by the Escrow Agent at a price equal to $8.78 per share, in Seller's sole discretion.  Solely for purposes of illustration, if an amount due to a Buyer Indemnified Party is $87,800, then, at Seller's discretion, Seller may satisfy such obligation through the release, by the Escrow Agent of 10,000 shares of the Escrow Amount."

7.           Waiver or Modification of Certain Conditions.  Buyer hereby agrees to waive the conditions set forth in Sections 6.02(d), (e), and (g)(x) of the Agreement.  With respect to the condition to Closing set forth in Section 6.02(g)(xiii), the Parties agree that Seller shall only be obligated to deliver lien waivers or releases for all work performed during the period beginning on or after  July 22, 2014 at Seller's re-refinery located in Columbus, Ohio and which work exceeds $10,000 in value.  With respect to the condition to Closing set forth in Sections 6.02(g)(vi) and 6.03(e)(ii), the Parties agreement that the reference in each such subsection to "ten (10) calendar days prior to the Closing Date" shall be changed to "twenty (20) calendar days prior to the Closing Date".

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8.           Real Estate at Norwalk, Ohio Location.  As provided by the terms of the Purchase Agreement and Schedule 6.02(e), Buyer conducted certain additional Environmental Assessments and other environmental investigations at Seller's real property located at 4376 State Route 601, Norwalk, Ohio (the "Norwalk Property").  According to the results of certain groundwater samplings conducted in connection therewith, elevated levels of certain substances were present at the Norwalk Property that requires further investigations that the Parties agree will occur after the Closing.  Accordingly, the Parties hereby agree to amend the Purchase Agreement with respect to the Norwalk Property as follows:

(a)           Seller shall conduct additional environmental site investigations at the Norwalk Property, using such consultants and third party experts as it determines in its discretion to investigate the source and scope of the elevated levels of such substances at the Norwalk Property and to develop a commercially reasonable remediation plan, if required under Law, based upon the results of such investigations to mitigate, in a commercially reasonable manner, any actual liability resulting from the presence of any Hazardous Substances. Seller shall keep Buyer reasonably informed as to the status and results of such investigations and Buyer and Seller shall cooperate in all reasonable respects with respect thereto.

(b)           If required under applicable Law to mitigate any liability resulting from the presence of any Hazardous Substances, Seller shall perform any necessary remediation at the Norwalk Property in accordance with, and to acceptable standards provided by, applicable Law.  Seller and Buyer shall cooperate in good faith and in all reasonable respects with developing a reasonably appropriate remediation plan, if applicable.  Buyer shall be responsible pursuant to subsection (c) below for a portion of any incurred remediation costs related thereto in an amount equal to the lessor of one-half of the actual costs of remediation incurred by Seller or $200,000 (such amount is referred to herein as the "Buyer's Costs").

(c)           Ownership of the real estate underlying the Norwalk Property shall not transfer to Buyer as of the Closing.  Instead, Buyer shall lease such real property from Seller, without any additional consideration paid to Seller during the lease term and without reduction in the Purchase Price due Seller at Closing until Seller completes any reasonably necessary or required remediation at the Norwalk Property, as reasonably determined by Buyer and Seller. Within thirty (30) days after Seller has furnished Buyer with reasonable evidence that the Norwalk Property has been remediated in accordance with the requirements hereof, Seller shall convey to Buyer good and marketable title to the Norwalk Property. Such transfer shall be effected by Seller to Buyer in the same manner, and under the same conditions, as those that apply to Seller's conveyance of the other items of the Real Property as set forth in the Purchase Agreement.  Upon the effective date of such transfer, Buyer shall pay Seller by wire transfer of immediately available funds, the amount of Buyer's Costs.  Any out of pocket costs of Seller in excess of $200,000 (net of the amount of the Buyer's Costs received by Seller) in conducting any required remediation at the Norwalk Property shall be counted for purposes of determining whether the Cap has been reached with respect to Section 11.05(c) of the Purchase Agreement.

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(d)           Seller shall provide Buyer with copies of all correspondence and other documentation submitted by Seller to any Governmental Authority or other Person in connection with the environmental condition of the Norwalk Property, including any notifications to any Governmental Authority (including the Ohio EPA), any remediation or corrective action plans, any correspondence from any such Governmental Authority in response thereto and any related materials, documents or correspondence.

(e)           The Parties agree in good faith to cooperate in all reasonable respects in addressing the environmental matters at the Norwalk Property and in seeking closure of such matters, including taking all commercially reasonable steps to limit each Party's costs and expenses in conducting the environmental site investigations and remediation, if required.

(f)           The Parties further agree that each of Buyer and Seller shall be entitled to equitable relief, including specific performance, to enforce the provisions of this section of this Amendment, and each such Party hereby agrees that it shall not object in any manner to seeking such equitable relief.

9.           Closing.  The parties agree that the Closing shall take place remotely by mail, facsimile, e-mail and/or wire transfer, in each case to the extent reasonably acceptable to the Parties, on or before December 5, 2014.

10.           No Other Changes.  All other terms, conditions, covenants, obligations and agreements in the Purchase Agreement shall remain in full force and effect and without any change due to this Second Amendment. Except as specifically set forth herein, the Purchase Agreement shall remain in full force and effect in accordance with its terms.  To the extent this Second Amendment is inconsistent with the Purchase Agreement, this Second Amendment shall govern and control.

[Remainder of page intentionally left blank; signature pages follow]

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IN WITNESS WHEREOF, the Parties hereto have caused this Second Amendment to the Asset Purchase Agreement to be executed effective as of the day, month and year first above written.

SELLER: HEARTLAND GROUP HOLDINGS, LLC By:  /s/Robert N. Schlott                            Robert N. Schlott, Chairman	WARREN DISTRIBUTION, INC. By:  /s/Charles P. Downey                        Charles P. Downey, President
BUYER: VERTEX REFINING OH, LLC By:  /s/Benjamin P. Cowart                       Benjamin P. Cowart, President and CEO	VERTEX: VERTEX ENERGY OPERATING, LLC By:  /s/Benjamin P. Cowart                       Benjamin P. Cowart, President and CEO
PARENT: VERTEX ENERGY, INC. By:  /s/Benjamin P. Cowart                       Benjamin P. Cowart, President and CEO

[Signature Page to Second Amendment to Asset Purchase Agreement]

Exhibit 1

Product Specifications

Testing	Method	Minimum	Max	Typical
Appearance	PMSAPT	Clear & Bright	Clear & Bright	Clear & Bright
Viscosity @ 40C/cSt	D-445	26	30	27.5
Viscosity @ 100C/cSt	D-445	4.90	5.30	5.06
Viscosity Index	D-2270	106		111
Color	D-1500		1.0	< 0.5
Flash Point	D-92	415F		462
Odor, pass/fail	PMSODR	Pass	Pass	Pass
Pour Point	D-97		- 12 C	- 14 C
Specific Gravity	D-1475	0.845	0.865	0.853
Crackle; pass/fail	WI SOM-2	Pass	Pass	Pass
Cold Crank, cP at -25C	D-5293	2000	2800	2133
Noack Volatility, % Mass	D-6375		14.5	13.3
Sulfur %, ppm	D-4294		300	0.017

EX-4.1

Exhibit 4.1

EXHIBIT A

NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.  THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

COMMON STOCK PURCHASE WARRANT

 VERTEX ENERGY, INC.

Warrant Shares: 109,934 Warrant #: A-1

THIS COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, The Benjamin Paul Cowart 2012 Grantor Retained Annuity Trust or its assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after Closing as such term is defined in that certain Subscription Agreement entered into between the Holder and the Company (as defined below) dated on or around December 4, 2014 (the “Closing” and the “Initial Exercise Date”) and on or prior to the close of business on the five year anniversary of the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe for and purchase from Vertex Energy, Inc., a Nevada corporation (the “Company”), up to 109,934 shares (as subject to adjustment hereunder, the “Warrant Shares”) of the Company’s common stock (“Common Stock”).  The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

Section 1.             Definitions.  In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated in this Section 1:

“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

“Board of Directors” means the board of directors of the Company.

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“Business Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of Texas are authorized or required by law or other governmental action to close.

“Commission” means the United States Securities and Exchange Commission.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“Liens” means a lien, charge pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

 “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Trading Day” means a day on which the Common Stock is traded on a Trading Market.

“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange or the OTCQB (or any successors to any of the foregoing).

“Transfer Agent” means the transfer agent of the Company and any successor transfer agent of the Company.

“VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if the OTCQB is the applicable Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTCQB, (c) if the Common Stock is not then listed or quoted for trading on a Trading Market and if prices for the Common Stock are then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

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Section 2.             Exercise.

a)           Exercise of Warrant.  Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed facsimile copy (or .pdf copy via e-mail) of the Notice of Exercise in the form annexed hereto and within three (3) Trading Days of the date said Notice of Exercise is delivered to the Company, the Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank or, if available, pursuant to the cashless exercise procedure specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required.  Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased.  The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice.  The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.

b)           Exercise Price.  The exercise price per share of the Common Stock under this Warrant shall be $3.01, subject to adjustment hereunder (the “Exercise Price”).

c)           Cashless Exercise.  If at any time the Holder proposes to exercise this Warrant or any portion hereof after the six-month anniversary of the date hereof, there is no effective Registration Statement registering, or no current prospectus available for, the resale of the Warrant Shares issuable to Holder upon exercise of the applicable portion of the Warrant proposed to be exercised by the Holder, or any portion thereof (each a “Non-Registered Time”), then the applicable portion of this Warrant not covered by such Registration Statement may also be exercised solely during such Non-Registered Time, in whole or in part, by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

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(A) = the VWAP on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;

(B) = the Exercise Price of this Warrant, as adjusted hereunder; and

(X) = the number of Warrant Shares that would be issuable upon exercise of the applicable portion of this Warrant which is not covered by an effective Registration Statement registering, or which there is no current prospectus available for, in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

Notwithstanding the above, no “cashless exercise” shall be allowed unless (A) is greater than the Exercise Price of this Warrant, as adjusted hereunder.

d)           Mechanics of Exercise.

i.      Delivery of Warrant Shares Upon Exercise.  Warrant Shares purchased hereunder shall be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144 (and this Warrant is being exercised via cashless exercise), and otherwise by physical delivery to the address specified by the Holder in the Notice of Exercise by the date that is three (3) Trading Days after the delivery to the Company of the Notice of Exercise, provided that the applicable Exercise Price and all applicable taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) have been paid prior to such date (such date, the “Warrant Share Delivery Date”).   The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior to the issuance of such shares, having been paid.

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ii.          Delivery of New Warrants Upon Exercise.  If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

iii.         Rescission Rights.  If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

iv.         [intentionally removed]

v.         No Fractional Shares or Scrip.  No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant.  As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.

vi.         Charges, Taxes and Expenses.  Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto.  The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

vii.         Closing of Books.  The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

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Section 3.             Certain Adjustments.

a)           Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged.  Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

b)           [RESERVED]

c)           [RESERVED]

d)           [RESERVED]

e)           Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction.  For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.  If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction.  The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrantwith the same effect as if such Successor Entity had been named as the Company herein.

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f)           Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

g)           Notice to Holder.

i.      Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

ii.      Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be mailed to the Holder at its last address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice.  To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K at the request of the Holder.  The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

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Section 4.             Transfer of Warrant.

a)           Transferability.  Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof, this Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer.  Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.  Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant in full.  The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.  Notwithstanding the above, the Holder and the assignee or assignees shall deliver documentation to the Company as the Company may reasonably request to enable the Company to confirm that an exemption from registration exists for such transfer and assignment, if applicable.

b)           New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney.  Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial Exercise Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

c)           Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder hereof from time to time.  The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

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d)           Representation by the Holder.  The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act.

Section 5.             Miscellaneous.

a)           No Rights as Stockholder Until Exercise.  This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3.

b)           Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

c)           Saturdays, Sundays, Holidays, etc.  If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.

d)           Authorized Shares.

The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.  The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant.  The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed.  The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).

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Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment.  Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

e)           Governing Law.  All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflict of laws thereof.  Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of this Warrant shall be commenced in the state and federal courts sitting in the City of Houston, County of Harris (the “Texas Courts”).  Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Texas Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such Texas Courts, or such Texas Courts are improper or inconvenient venue for such proceeding.  Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Warrant.  If any party shall commence an action or proceeding to enforce any provisions of this Warrant, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

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f)           Restrictions.  The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.

g)           Nonwaiver and Expenses.  No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date.  If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

h)           Notices.  Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service, addressed to the Company, at the address set forth above Attention: Chris Carlson, facsimile number (281) 754-4185, email address chrisc@VertexEnergy.com, or such other facsimile number, email address or address as the Company may specify for such purposes by notice to the Holders.  Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of such Holder appearing on the books of the Company, or if no such facsimile number or address appears on the books of the Company.  Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth in this Section prior to 5:30 p.m. (Houston, Texas time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (Houston, Texas time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given.

i)           Limitation of Liability.  No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

j)           Remedies.  The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant.  The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

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k)           Successors and Assigns.  Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder.  The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

l)           Amendment.  This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder, provided that the Exercise Price may not be reduced below $3.01 per share without approval of the shareholders of the Company.

m)           Severability.  Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

n)           Headings.  The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

o)           NASDAQ Approval. The Company’s Common Stock is listed on the NASDAQ Capital Market (“NASDAQ”). By accepting this Warrant, the Holder agrees and acknowledges its understanding of that fact that NASDAQ has not had sufficient time to review this Warrant or the terms of the offering associated herewith (the “Offering”) in order to confirm that such terms and conditions (including, but not limited to the offering price of the shares and Warrants sold in connection with the Offering (the “Offering Price”) and the Exercise Price) comply in all respects with NASDAQ’s additional listing rules and regulations (the “NASDAQ Rules”).  As such, by accepting this Warrant, the Holder agrees to adjust the Offering Price, Exercise Price, total number of Warrants, or such other terms and conditions of the Offering as the Company may reasonably request subsequent to the Closing to confirm compliance with NASDAQ Rules (each a “NASDAQ Adjustment”).  The Holder agrees to take such other action and to execute, acknowledge and deliver such contracts, deeds, or other documents as may be reasonably requested and necessary or appropriate to carry out any NASDAQ Adjustment, including, if necessary, returning shares or Warrants to the Company for cancellation or entering into amendments to this Warrant Agreement.

********************

(Signature Page Follows)

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

VERTEX ENERGY, INC.

By: /s/ Chris Carlson

      Name: Chris Carlson

      Title: CFO

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NOTICE OF EXERCISE

TO:           VERTEX ENERGY, INC.

(1)      The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

(2)      Payment shall take the form of (check applicable box):

[  ] in lawful money of the United States; or

[  ] if permitted, the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

(3)      Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

The Warrant Shares shall be delivered to the following DWAC Account Number:

[SIGNATURE OF HOLDER]

Name of Investing Entity:

Signature of Authorized Signatory of Investing Entity:

Name of Authorized Signatory:

Title of Authorized Signatory:

Date:

EXHIBIT B

ASSIGNMENT FORM

 (To assign the foregoing Warrant, execute this form and supply required information.  Do not use this form to purchase shares.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

Name:
	(Please Print)
Address:
	(Please Print)
Dated: _______________ __, ______
Holder’s Signature:
Holder’s Address:

EX-4.2

Exhibit 4.2

EXHIBIT A

NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.  THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

COMMON STOCK PURCHASE WARRANT

 VERTEX ENERGY, INC.

Warrant Shares: 109,934 Warrant #: A-2

THIS COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, The Shelley T. Cowart 2012 Grantor Retained Annuity Trust or its assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after Closing as such term is defined in that certain Subscription Agreement entered into between the Holder and the Company (as defined below) dated on or around December 4, 2014 (the “Closing” and the  “Initial Exercise Date”) and on or prior to the close of business on the five year anniversary of the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe for and purchase from Vertex Energy, Inc., a Nevada corporation (the “Company”), up to 109,934 shares (as subject to adjustment hereunder, the “Warrant Shares”) of the Company’s common stock (“Common Stock”).  The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

Section 1.             Definitions.  In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated in this Section 1:

“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

“Board of Directors” means the board of directors of the Company.

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“Business Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of Texas are authorized or required by law or other governmental action to close.

“Commission” means the United States Securities and Exchange Commission.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“Liens” means a lien, charge pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

 “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Trading Day” means a day on which the Common Stock is traded on a Trading Market.

“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange or the OTCQB (or any successors to any of the foregoing).

“Transfer Agent” means the transfer agent of the Company and any successor transfer agent of the Company.

“VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if the OTCQB is the applicable Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTCQB, (c) if the Common Stock is not then listed or quoted for trading on a Trading Market and if prices for the Common Stock are then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

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Section 2.             Exercise.

a)           Exercise of Warrant.  Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed facsimile copy (or .pdf copy via e-mail) of the Notice of Exercise in the form annexed hereto and within three (3) Trading Days of the date said Notice of Exercise is delivered to the Company, the Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or cashier’s check drawn on a United States bank or, if available, pursuant to the cashless exercise procedure specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required.  Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased.  The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice.  The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.

b)           Exercise Price.  The exercise price per share of the Common Stock under this Warrant shall be $3.01, subject to adjustment hereunder (the “Exercise Price”).

c)           Cashless Exercise.  If at any time the Holder proposes to exercise this Warrant or any portion hereof after the six-month anniversary of the date hereof, there is no effective Registration Statement registering, or no current prospectus available for, the resale of the Warrant Shares issuable to Holder upon exercise of the applicable portion of the Warrant proposed to be exercised by the Holder, or any portion thereof (each a “Non-Registered Time”), then the applicable portion of this Warrant not covered by such Registration Statement may also be exercised solely during such Non-Registered Time, in whole or in part, by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

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(A) = the VWAP on the Trading Day immediately preceding the date on which Holder elects to exercise this Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;

(B) = the Exercise Price of this Warrant, as adjusted hereunder; and

(X) = the number of Warrant Shares that would be issuable upon exercise of the applicable portion of this Warrant which is not covered by an effective Registration Statement registering, or which there is no current prospectus available for, in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

Notwithstanding the above, no “cashless exercise” shall be allowed unless (A) is greater than the Exercise Price of this Warrant, as adjusted hereunder.

d) Mechanics of Exercise.

i.      Delivery of Warrant Shares Upon Exercise.  Warrant Shares purchased hereunder shall be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144 (and this Warrant is being exercised via cashless exercise), and otherwise by physical delivery to the address specified by the Holder in the Notice of Exercise by the date that is three (3) Trading Days after the delivery to the Company of the Notice of Exercise, provided that the applicable Exercise Price and all applicable taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) have been paid prior to such date (such date, the “Warrant Share Delivery Date”).   The Warrant Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior to the issuance of such shares, having been paid.

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ii.          Delivery of New Warrants Upon Exercise.  If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

iii.         Rescission Rights.  If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

iv.         [intentionally removed]

v.         No Fractional Shares or Scrip.  No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant.  As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.

vi.         Charges, Taxes and Expenses.  Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto.  The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

vii.         Closing of Books.  The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

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Section 3.             Certain Adjustments.

a)           Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged.  Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

b)           [RESERVED]

c)           [RESERVED]

d)           [RESERVED]

e)           Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction.  For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.  If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction.  The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrantwith the same effect as if such Successor Entity had been named as the Company herein.

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f)           Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

g)           Notice to Holder.

i.      Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

ii.      Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be mailed to the Holder at its last address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice.  To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K at the request of the Holder.  The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

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Section 4.             Transfer of Warrant.

a)           Transferability.  Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof, this Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer.  Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.  Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant in full.  The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.  Notwithstanding the above, the Holder and the assignee or assignees shall deliver documentation to the Company as the Company may reasonably request to enable the Company to confirm that an exemption from registration exists for such transfer and assignment, if applicable.

b)           New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney.  Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial Exercise Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

c)           Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder hereof from time to time.  The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

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d)           Representation by the Holder.  The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act.

Section 5.             Miscellaneous.

a)           No Rights as Stockholder Until Exercise.  This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3.

b)           Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

c)           Saturdays, Sundays, Holidays, etc.  If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.

d)           Authorized Shares.

The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.  The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant.  The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed.  The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).

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Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment.  Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

e)           Governing Law.  All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflict of laws thereof.  Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of this Warrant shall be commenced in the state and federal courts sitting in the City of Houston, County of Harris (the “Texas Courts”).  Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Texas Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such Texas Courts, or such Texas Courts are improper or inconvenient venue for such proceeding.  Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Warrant.  If any party shall commence an action or proceeding to enforce any provisions of this Warrant, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

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f)           Restrictions.  The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.

g)           Nonwaiver and Expenses.  No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding the fact that all rights hereunder terminate on the Termination Date.  If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

h)           Notices.  Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service, addressed to the Company, at the address set forth above Attention: Chris Carlson, facsimile number (281) 754-4185, email address chrisc@VertexEnergy.com, or such other facsimile number, email address or address as the Company may specify for such purposes by notice to the Holders.  Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of such Holder appearing on the books of the Company, or if no such facsimile number or address appears on the books of the Company.  Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth in this Section prior to 5:30 p.m. (Houston, Texas time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (Houston, Texas time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given.

i)           Limitation of Liability.  No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

j)           Remedies.  The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant.  The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

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k)           Successors and Assigns.  Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder.  The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

l)           Amendment.  This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder, provided that the Exercise Price may not be reduced below $3.01 per share without approval of the shareholders of the Company.

m)           Severability.  Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

n)           Headings.  The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

o)           NASDAQ Approval. The Company’s Common Stock is listed on the NASDAQ Capital Market (“NASDAQ”). By accepting this Warrant, the Holder agrees and acknowledges its understanding of that fact that NASDAQ has not had sufficient time to review this Warrant or the terms of the offering associated herewith (the “Offering”) in order to confirm that such terms and conditions (including, but not limited to the offering price of the shares and Warrants sold in connection with the Offering (the “Offering Price”) and the Exercise Price) comply in all respects with NASDAQ’s additional listing rules and regulations (the “NASDAQ Rules”).  As such, by accepting this Warrant, the Holder agrees to adjust the Offering Price, Exercise Price, total number of Warrants, or such other terms and conditions of the Offering as the Company may reasonably request subsequent to the Closing to confirm compliance with NASDAQ Rules (each a “NASDAQ Adjustment”).  The Holder agrees to take such other action and to execute, acknowledge and deliver such contracts, deeds, or other documents as may be reasonably requested and necessary or appropriate to carry out any NASDAQ Adjustment, including, if necessary, returning shares or Warrants to the Company for cancellation or entering into amendments to this Warrant Agreement.

********************

(Signature Page Follows)

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

VERTEX ENERGY, INC.

By:/s/ Chris Carlson

     Name: Chris Carlson

     Title: CFO

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NOTICE OF EXERCISE

TO:           VERTEX ENERGY, INC.

(1)      The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

(2)      Payment shall take the form of (check applicable box):

[  ] in lawful money of the United States; or

[  ] if permitted, the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

 (3)           Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

The Warrant Shares shall be delivered to the following DWAC Account Number:

[SIGNATURE OF HOLDER]

Name of Investing Entity:

Signature of Authorized Signatory of Investing Entity:

Name of Authorized Signatory:

Title of Authorized Signatory:

Date:

  EXHIBIT B

ASSIGNMENT FORM

 (To assign the foregoing Warrant, execute this form and supply required information.  Do not use this form to purchase shares.)

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

Name:
	(Please Print)
Address:
	(Please Print)
Dated: _______________ __, ______
Holder’s Signature:
Holder’s Address:

EX-10.2

Exhibit 10.2

SUBSCRIPTION AGREEMENT

IN

VERTEX ENERGY, INC.

A.           Subscription. This Agreement has been executed by _______________ (the “Subscriber”)in connection with the subscription to purchase (a) _____________ shares of the common stock, $0.001 par value per share (the “Common Stock” and the “Shares”) of Vertex Energy, Inc., a Nevada corporation (the “Company”), and (b) warrants to purchase 109,934 shares of the Common Stock of the Company at an exercise price of $3.01 per share (the “Exercise Price”), evidenced by the Common Stock Purchase Warrant attached hereto as Exhibit A (the “Warrants” and the “Warrant Agreement” and together with the Shares, the “Securities”) at an aggregate purchase price of $__________ (the “Purchase Price”). This Subscription Agreement is referred to herein as the “Agreement” or the “Subscription”. The offering of the Securities shall be defined herein as the “Offering”. The Offering is made in reliance upon an exemption from registration under the federal securities laws provided by Section 4(a)(2) and Rule 506(b) of Regulation D of the Securities Act of 1933, as amended.

When the context in which words are used in this Agreement indicates that such is the intent, singular words shall include the plural, and vice versa, and masculine words shall include the feminine and neuter genders, and vice versa. Any reference to a person shall include an individual, trust, estate, or any incorporated or unincorporated organization, including general or limited partnerships, limited liability companies, corporations, joint ventures and cooperatives, and all heirs, executors, administrators, legal representatives, successors and assigns of such person where permitted or required by the context. Captions are inserted for convenience only, are not a part of this Agreement, and shall not be used in the interpretation of this Agreement.

This Agreement shall be binding on the Subscriber and the Company, subject to the terms hereof, upon execution by the Subscriber and the Company.

B.           Representations and Warranties of Subscriber. Subscriber hereby represents and warrants to the Company as follows:

i)            Subscriber (or the person making the investment decision hereunder on behalf of the Subscriber, if the Subscriber is an entity) is a sophisticated investor that has such knowledge and experience in financial and business matters that Subscriber is capable of evaluating the merits and risks of an investment in the Company and the suitability of the Securities as an investment for Subscriber;

ii)            Subscriber is an “Accredited Investor” as such term is defined in Rule 501 of the Securities Act of 1933, as amended (the “Securities Act”, the “Act” or the “1933 Act”) , and has completed the Certification of Accredited Investor Status attached hereto as Exhibit B;

iii)           The Subscriber is acquiring the Securities for its own account for long-term investment and not with a view toward resale, fractionalization or division, or distribution thereof, and he does not presently have any reason to anticipate any change in its circumstances, financial or otherwise, or particular occasion or event which would necessitate or require its sale or distribution of the Securities. No one other than the Subscriber has any beneficial interest in said securities. The Subscriber is purchasing the Securities for its account for the purpose of investment and not with a view to, or for sale in connection with, any distribution thereof. Subscriber has had an opportunity to ask questions of and receive satisfactory answers from the Company, or any person or persons acting on behalf of the Company, concerning the terms and conditions of this investment and the Offering, and all such questions have been answered to the full satisfaction of Subscriber. The Company has not supplied Subscriber any information other than as contained in this Agreement, and Subscriber is relying on its own investigation and evaluation of the Company and the Securities in making an investment hereunder and not on any other information;

Page 1 of 8

Subscription Agreement

Vertex Energy, Inc.

iv)           Subscriber is able to bear the economic risk of the investment in the Securities and Subscriber has sufficient net worth to sustain a loss of Subscriber’s entire investment in the Company without economic hardship if such a loss should occur;

v)           The Subscriber recognizes that the investment herein is a speculative venture and that the total amount of funds tendered to purchase Securities is placed at the risk of the business and may be completely lost;

vi)           Subscriber acknowledges and is aware of the following:

(1)           There are substantial restrictions on the transferability of the Securities; the Securities will not be, and the Subscriber has no right to require that the Securities be registered under the 1933 Act; there may not be any public market for the Securities; Subscriber may not be able to use the provisions of Rule 144 of the 1933 Act with respect to the resale of the Securities; and accordingly, Subscriber may have to hold the Securities indefinitely and it may not be possible for Subscriber to liquidate Subscriber’s investment in the Company. Subscriber agrees that the Securities shall not be sold, transferred, pledged or hypothecated unless such sale is exempt from registration under the 1933 Act. Subscriber also acknowledges that Subscriber shall be responsible for compliance with all conditions on transfer imposed by any blue sky or securities law administrator and for any expenses incurred by the Company for legal or accounting services in connection with reviewing a proposed transfer; and

(2)           No federal or state agency has made any finding or determination as to the fairness of the Offering of the Securities for investment or any recommendation or endorsement of the Securities; and

(3)           The Securities have not been approved or registered under any Blue Sky law or with any State Securities Division, and as such, there may be restrictions on the sale or transfer of such Securities under State law.

vii)          The Subscriber has carefully considered and has, to the extent it believes such discussion is necessary, discussed with its professional, legal, tax and financial advisors, the suitability of an investment in the Securities for its particular tax and financial situation and that the Subscriber and its advisers, if such advisors were deemed necessary, have determined that the Securities are a suitable investment for it;

viii)         The Subscriber has not become aware of this Offering and has not been offered Securities by any form of general solicitation or advertising, including, but not limited to, advertisements, articles, notices or other communications published in any newspaper, magazine, or other similar media or television or radio broadcast or any seminar or meeting where, to the Subscriber's knowledge, those individuals that have attended have been invited by any such or similar means of general solicitation or advertising;

Page 2 of 8

Subscription Agreement

Vertex Energy, Inc.

ix)           The Subscriber realizes that the Securities cannot readily be sold and will be restricted securities and therefore the Securities must not be purchased unless the Subscriber has liquid assets sufficient to assure that such purchase will cause no undue financial difficulties and the Subscriber can provide for current needs and possible personal contingencies;

x)            The Subscriber represents that he has (i) adequate means of providing for its current needs and possible personal contingencies, and (ii) has no need for liquidity in this particular investment;

xi)           The Subscriber understands that the Securities are being offered and sold to it in reliance on specific exemptions from or non-application of the registration requirements of federal and state securities laws and that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the Subscriber set forth herein in order to determine the applicability of such exemptions and the suitability of the Subscriber to acquire the Securities. All information which the Subscriber has provided to the Company concerning the undersigned's financial position and knowledge of financial and business matters is correct and complete as of the date hereof, and if there should be any material change in such information prior to acceptance of this Agreement by the Company, the undersigned will immediately provide the Company with such information;

xii)          The Subscriber has the requisite power and authority to enter into and perform the transactions contemplated by this Agreement and the purchase of the Securities. The execution, delivery and performance of this Agreement by the Subscriber and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary corporate, partnership or other entity action, and no further consent or authorization of the Subscriber is required. When executed and delivered by the Subscriber, this Agreement shall constitute a valid and binding obligation of the Subscriber enforceable against the Subscriber in accordance with its terms;

xiii)          The Subscriber has not agreed to act with any of the other investors for the purpose of acquiring, holding, voting or disposing of the Securities purchased hereunder for purposes of Section 13(d) under the Securities Exchange Act of 1934, as amended, and the Subscriber is acting independently with respect to its investment in the Securities;

xiv)         The Subscriber: (i) if a natural person, represents that the Subscriber has reached the age of 21 and has full authority, legal capacity and competence to enter into, execute and deliver this Agreement and all other related agreements or certificates and to take all actions required pursuant hereto and thereto and to carry out the provisions hereof and thereof, or (ii) if a corporation, partnership, or limited liability company or partnership, or association, joint stock company, trust, unincorporated organization or other entity, represents that such entity was not formed for the specific purpose of acquiring the Securities and such entity is duly organized, validly existing and in good standing under the laws of the state of its organization. Any individual executing this Agreement on behalf of an entity has authority to act on behalf of such entity and has been duly and properly authorized to sign this Agreement on behalf of such entity, provided further that such entity has validly authorized and approved such entity’s entry into this Agreement and the transactions contemplated herein;

Page 3 of 8

Subscription Agreement

Vertex Energy, Inc.

xv)          The Subscriber confirms and certifies that:

(a) Subscriber is in receipt of and has carefully read and reviewed and understands the Warrant Agreement attached hereto as Exhibit A.

(b) The Subscription hereunder is irrevocable by Subscriber, and, except as required by law, Subscriber is not entitled to cancel, terminate or revoke this Agreement or any agreements of Subscriber hereunder except as set forth in Section F.

(c) No federal or state agency has made any findings or determination as to the fairness of the terms of this Offering for investment purposes; or any recommendations or endorsements of the Securities.

(d) The Offering is intended to be exempt from registration under the Securities Act by virtue of Section 4(2) of the Securities Act and the provisions of Rule 506 of Regulation D thereunder, which is in part dependent upon the truth, completeness and accuracy of the statements made by the Subscriber herein.

(e) It is understood that in order not to jeopardize the Offering’s exempt status under Section 4(2) of the Securities Act and Regulation D or Regulation S, any transferee may, at a minimum, be required to fulfill the investor suitability requirements thereunder.

(f) IN MAKING AN INVESTMENT DECISION, SUBSCRIBER MUST RELY ON ITS OWN EXAMINATION OF THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THE SHARES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

(g) THIS SUBSCRIPTION DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN ANY STATE OR JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION IS NOT PERMITTED UNDER APPLICABLE LAW OR TO ANY FIRM OR INDIVIDUAL THAT DOES NOT POSSESS THE QUALIFICATIONS PRESCRIBED IN THIS SUBSCRIPTION.

C.            Indemnification. Subscriber acknowledges that Subscriber understands the meaning and legal consequences of the representations and warranties in paragraph B hereof, and Subscriber hereby agrees to indemnify and hold harmless the Company and its affiliates, partners, officers, directors, agents, attorneys, and employees from and against any and all loss, damage or liability due to or arising out of a breach of any such representations or warranties and the breach of any representations and warranties whatsoever made herein. Notwithstanding the foregoing, however, no representation, warranty, acknowledgment or agreement made herein by Subscriber shall in any manner be deemed to constitute a waiver of any rights granted to Subscriber under federal or state securities laws. The representations and warranties set forth herein shall survive the date upon which the Subscriber becomes a shareholder of the Company. No representation, warranty or covenant in this Agreement contains any untrue statement of a material fact, or omits to state a material fact necessary to make the statements contained therein, in the light of the circumstances under which they were or are to be made, not misleading.

 Page 4 of 8

Subscription Agreement

Vertex Energy, Inc.

D.           Compliance with Securities Laws. Subscriber understands and agrees that a legend has been or will be placed on any certificate(s) or other document(s) evidencing the Securities in substantially the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES ACT. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (I) THEY SHALL HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND ANY APPLICABLE STATE SECURITIES ACT, OR (II) THE CORPORATION SHALL HAVE BEEN FURNISHED WITH AN OPINION OF COUNSEL, SATISFACTORY TO COUNSEL FOR THE CORPORATION, THAT REGISTRATION IS NOT REQUIRED UNDER ANY SUCH ACTS.”

E.            U.S.A. Patriot Act and Anti-Money Laundering Representations. Subscriber represents and warrants that Subscriber is not and is not acting as an agent, representative, intermediary or nominee for, a person identified on the list of blocked persons maintained by the Office of Foreign Assets Control, U.S. Department of Treasury. In addition, Subscriber is in full compliance with all applicable U.S. laws, regulations, directives, and executive orders imposing economic sanctions, embargoes, export controls or anti-money laundering requirements, including but not limited to the following laws: (1) the International Emergency Economic Powers Act, 50 U.S.C. 1701-1706; (2) the National Emergencies Act, 50 U.S.C. 1601-1651; (3) section 5 of the United Nations Participation Act of 1945, 22 U.S.C. 287c; (4) Section 321 of the Antiterrorism Act, 18 U.S.C. 2332d; (5) the Export Administration Act of 1979, as amended, 50 U.S.C. app. 2401-2420; (6) the Trading with the Enemy Act, 50 U.S.C. app. 1 et seq.; (7) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56; and (8) Executive Order 13224 (Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism) of September 23, 2001. The Subscriber represents that the amounts invested by it in the Company in the Offering were not and are not directly or indirectly derived from activities that contravene federal, state or international laws and regulations, including anti-money laundering laws and regulations. To the best of the Subscriber’s knowledge, none of: (1) the Subscriber; (2) any person controlling or controlled by the Subscriber; (3) if the Subscriber is a privately-held entity, any person having a beneficial interest in the Subscriber; or (4) any person for whom the Subscriber is acting as agent or nominee in connection with this investment is a country, territory, individual or entity named on an Office of Foreign Assets Control (“OFAC”) list, or a person or entity prohibited under the OFAC Programs.

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Subscription Agreement

Vertex Energy, Inc.

F.            Closing. The sale of the Securities (the “Closing”) will take place concurrently with the closing of the transactions contemplated by that certain Asset Purchase Agreement by and among the Company, Vertex Energy Operating, LLC, the wholly-owned subsidiary of the Company, Vertex Refining OH, LLC, an indirect wholly-owned subsidiary of the Company, and Heartland Group Holdings, LLC (“Heartland”), dated October 21, 2014 (as amended, modified and supplemented to date, the “Purchase Agreement”). Subscriber acknowledges and agrees that this subscription is irrevocable and binding on the part of the Subscriber. Notwithstanding any other term or provision hereof, in the event the Closing does not occur by December 12, 2014, the Subscriber or the Company shall have the right to terminate the Offering and upon such termination all funds provided by the Subscriber to the Company in connection with this Agreement shall be returned to the Subscriber without interest.

G.            Entire Agreement. This Subscription and the Warrant Agreement are the entire and fully integrated agreement of the parties regarding the subject matter hereof, and there are no oral representations, warranties, agreements, or promises pertaining to this Subscription, the Warrant Agreement or the Securities.

H.            Purchase Payment. The purchase price shall be paid to the Company in cash, check or via wire transfer simultaneously with the undersigned’s entry into this Agreement.

I.             Construction of Terms. As used in this Agreement, the terms “herein,” “herewith,” “hereof” and “hereunder” are references to this Agreement, taken as a whole; the term “includes” or “including” shall mean “including, without limitation;” the word “or” is not exclusive; and references to a “Section,” “subsection,” “clause,” “Exhibit,” “Appendix,” “Schedule,” “Annex” or “Attachment” shall mean a Section, subsection, clause, Exhibit, Appendix, Schedule, Annex or Attachment of this Agreement, as the case may be, unless in any such case the context requires otherwise. Exhibits, Appendices, Schedules, Annexes or Attachments to any document shall be deemed incorporated by reference in such document. All references to or definitions of any agreement, instrument or other document (a) shall include all documents, instruments or agreements issued or executed in replacement thereof, and (b) except as otherwise expressly provided, shall mean such agreement, instrument or document, or replacement or predecessor thereto, as modified, amended, supplemented and restated through the date as of which such reference is made.

J.            Effect of Facsimile and Photocopied Signatures. This Agreement may be executed in several counterparts, each of which is an original. It shall not be necessary in making proof of this Agreement or any counterpart hereof to produce or account for any of the other counterparts. A copy of this Agreement signed by one party and (a) faxed to another party or (b) scanned and emailed to another party, shall be deemed to have been executed and delivered by the signing party as though an original. A photocopy or PDF of this Agreement shall be effective as an original for all purposes.

K.           Severability. The holding of any provision of this Subscription Agreement to be invalid or unenforceable by a court of competent jurisdiction shall not affect any other provision of this Subscription Agreement, which shall remain in full force and effect.

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Subscription Agreement

Vertex Energy, Inc.

L.           Further Assurances. The parties agree to execute and deliver all such further documents, agreements and instruments and take such other and further action as may be necessary or appropriate to carry out the purposes and intent of this Subscription Agreement.

M.          Governing Law. This Agreement shall be interpreted in accordance with the laws of the State of Texas. In the event of a dispute concerning this Agreement, the parties agree that venue lies in a court of competent jurisdiction in any Texas court.

N.           Review of Document; Arm’s Length Transaction. Each party herein expressly represents and warrants to all other parties hereto that (a) before executing this Subscription, said party has fully informed itself of the terms, contents, conditions and effects of this Subscription; (b) said party has relied solely and completely upon its own judgment in executing this Subscription; (c) said party has had the opportunity to seek and has obtained the advice of its own legal, tax and business advisors before executing this Subscription; (d) said party has acted voluntarily and of its own free will in executing this Subscription; and (e) this Subscription is the result of arm’s length negotiations conducted by and among the parties and their respective counsel.

O.           NASDAQ Capital Market Review. The Company’s Common Stock is listed on the NASDAQ Capital Market (“NASDAQ”). The Subscriber agrees and acknowledges its understanding of that fact that NASDAQ has not had sufficient time to review this Agreement or the terms of the Offering in order to confirm that such terms and conditions (including, but not limited to the offering price of the Shares and Warrants (the “Offering Price”) and the Exercise Price) comply in all respects with NASDAQ’s additional listing rules and regulations (the “NASDAQ Rules”).  As such, the Subscriber agrees to adjust the Offering Price, Exercise Price, total number of Shares, total number of Warrants, or such other terms and conditions of the Offering as the Company may reasonably request subsequent to the Closing to confirm compliance with NASDAQ Rules (each a “NASDAQ Adjustment”).  The Subscriber agrees to take such other action and to execute, acknowledge and deliver such contracts, deeds, or other documents as may be reasonably requested and necessary or appropriate to carry out any NASDAQ Adjustment, including, if necessary, returning Shares or Warrants to the Company for cancellation or entering into amendments to this Subscription or the Warrant Agreement.

P.           Piggyback Registration Rights.  The Company covenants and agrees that if, at any time prior to the Registration Rights Expiration Date (defined below), it proposes to file a registration statement with respect to any class of equity or equity-related securities (other than in connection with an offering to the Company’s employees (Form S-8) or in connection with an acquisition, merger or similar transaction (Form S-4)) under the Securities Act in a primary registration on behalf of the Company and/or in a secondary registration on behalf of holders of such securities, and the registration form to be used may be used for the issuance or resale of the Shares and the shares of Common Stock issuable upon exercise of the Warrants (the “Warrant Shares” and together with the Shares, the “Registrable Securities”), the Company will give prompt written notice to Subscriber of its intention to file such registration statement and will offer to include in such registration statement, such number of Registrable Securities with respect to which the Company has received written requests for inclusion therein within three (3) days after the giving of notice by the Company (the “Piggyback Registration Rights”).  Subscriber acknowledges and understands that the Company may file a secondary registration on behalf of certain investors that have provided or will provide financing or other resources to the Company or who have received shares in acquisition or combination transactions, that the inclusion of the Registrable Securities in such registration statement(s) is subject to the prior approval of such shareholders, and that such shareholders may not approve the inclusion of the Registrable Securities, in which case, the Piggyback Registration Rights provided in this paragraph will continue pursuant to the terms of this paragraph for any subsequent primary or secondary registration statement.  The Subscriber acknowledges and understands that the Company shall not be required to include Registrable Securities in a registration statement relating solely to an offering by the Company of securities for its own account if the managing underwriter or placement agent shall have advised the Company in writing that the inclusion of such securities will have a material adverse effect upon the ability of the Company to sell securities for its own account, and provided further that the Subscriber is not treated less favorably than others seeking to have their securities included in such registration statement. If the registration statement relating to the Piggyback Registration Rights is for an underwritten offering, such Registrable Securities shall be included in the underwriting on the same terms and conditions as the securities otherwise being sold through the underwriters. Notwithstanding the obligations set forth above, if any Securities and Exchange Commission guidance sets forth a limitation on the number of securities permitted to be registered on a particular registration statement as a secondary offering, the number of Registrable Securities to be registered on such registration statement will be reduced pro rata between the Subscriber and other parties whose securities are included in such registration statement. The “Registration Rights Expiration Date” shall be five years from the Closing.

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Subscription Agreement

Vertex Energy, Inc.

Q.           Purchase Price. The Subscriber shall pay the Purchase Price to the Company concurrently with the Subscriber’s entry into this Agreement, which funds shall be held by the Company in trust for the benefit of the Subscriber until the earlier of (a) the Closing, when they shall become the sole property of the Company; or (b) the termination of the Offering (as described in Section F) at which time such funds shall be returned to the Subscriber without interest.

“SUBSCRIBER”

Entity Name (if applicable):____________________

By:______________________________

Its:______________________________

Printed Name:_________________________

Address:________________________________

SS#/EIN#:______________________________

Date: _______________________________

“COMPANY”

Vertex Energy, Inc.

______________________________

Chris Carlson

Chief Financial Officer

Date: _______________________________

 Page 8 of 8

Subscription Agreement

Vertex Energy, Inc.

CERTIFICATION OF ACCREDITED INVESTOR STATUS

Except as may be indicated by the undersigned below, the undersigned is an “accredited investor,” as that term is defined in Rule 5011 of Regulation D of the Securities Act of 1933, as amended (the “Securities Act”). The undersigned has initialed the line below indicating (a) the basis on which he, she or it is representing his, her or its status as an “accredited investor”; or (b) that the undersigned is not an “accredited investor”, at the request of Vertex Energy, Inc., a Nevada corporation (the “Company”).  The representation and confirmation below as part of this Certification of Accredited Investor Status (the “Certification”) shall be effective for all purposes and shall be able to be relied upon by the Company, its legal counsel and assigns for any and all purposes, until such time, if ever, as the undersigned has advised the Company that the representations below are no longer accurate or correct.

By initializing below the undersigned confirms, acknowledges and represents that he, she or it, is an “accredited investor” because he, she or it is:

a bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary capacity; a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the “Securities Exchange Act”); an insurance company as defined in Section 2(13) of the Securities Act; an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; a small business investment company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, and such plan has total assets in excess of $5,000,000; an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are “accredited investors”;

a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;

an organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;

a natural person whose individual net worth, or joint net worth with the undersigned’s spouse, at the time of this purchase exceeds $1,000,000. For purposes of this item, “net worth” means the excess of total assets at fair market value (including personal and real property, but excluding the estimated fair market value of a person’s primary home) over total liabilities. Total liabilities excludes any mortgage on the primary home in an amount of up to the home’s estimated fair market value as long as the mortgage was incurred more than 60 days before the Closing Date, but includes (i) any mortgage amount in excess of the home’s fair market value and (ii) any mortgage amount that was borrowed during the 60-day period before the Closing Date;

a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with the undersigned’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year. “Income” for this purpose is computed by adding the following items to adjusted gross income for federal income tax purposes: (a) the amount of any tax-exempt interest income received; (b) the amount of losses claimed as a limited partner in a limited partnership; (c) any deduction claimed for depletion; (d) deductions for alimony paid; (e) deductible amounts contributed to an IRA or Keogh retirement plan; and (f) any amount by which income from long-term capital gains has been reduced in arriving at adjusted gross income pursuant to the provisions of Section 1202 of the Internal Revenue Code;

1http://www.law.cornell.edu/cfr/text/17/230.501

an irrevocable trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring any securities of the Company, whose purchase is directed by a person who has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment;

an irrevocable trust where the grantor is an “accredited investor” and is considered an “equity owner” because the trust has the following characteristics:

• The trust is a grantor trust for federal income tax purposes and the grantor(s) is the sole funding source; AND

• The grantor would be taxed on all income of the trust and would be taxed on the sale of trust assets; AND

• The grantor(s) is the trustee with sole investment discretion; AND

• The entire amount of the grantor’s contribution plus a rate of return would be paid to the grantor prior to any other payments; AND

• The trust was established by the grantor for estate planning purposes; AND

• Creditors of the grantor(s) would be able to reach the grantor’s interest in the trust.

(If this category is checked, please also check the additional category or categories under which the grantor qualifies as an accredited investor).

a trust that is revocable by its grantor and has a single grantor who is an accredited investor and is the sole source of funds for the trust (If this category is checked, please also check the additional category or categories under which the grantor qualifies as an accredited investor);

an entity (other than a trust) in which all of the equity holders are “accredited investors” by virtue of their meeting one or more of the above standards; or

a director, executive officer, or general partner of Vertex Energy, Inc., or any director, executive officer, or general partner of a general partner of Vertex Energy, Inc.;

OR

by initializing to the left or failing to initial one of the requirements above, the undersigned confirms, acknowledges and represents that he, she or it, is not an “accredited investor” because he, she or it does not meet one of the requirements above.

* * * * * * * * * * * * * * *

The undersigned agrees that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the undersigned as set forth herein. All information which the undersigned has provided to the Company is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

IN WITNESS WHEREOF, the undersigned has executed this Certification of Accredited Investor Status on December 4, 2014.

 Name:______________________________________________

By: _________________________________________________

Signature

Printed Name of Signatory (if entity):_______________________

Title: _________________________________________________

(required for any stockholder that is a corporation, partnership, trust or other entity)

EX-10.3

Exhibit 10.3

FIRST AMENDMENT TOCREDIT AND GUARANTY AGREEMENT

THIS FIRST AMENDMENT TO CREDIT AND GUARANTY AGREEMENT (this “Amendment”) is entered into as of December 5, 2014, by and among VERTEX ENERGY OPERATING, LLC., a Texas limited liability company (“Company”), VERTEX ENERGY, INC., a Nevada corporation (“Holdings”), the other Credit Parties signatory hereto, the Lenders signatory hereto and GOLDMAN SACHS BANK USA, as Administrative Agent for the Lenders (in such capacity, “Administrative Agent”) and as Collateral Agent for the Lenders (in such capacity, “Collateral Agent”).

RECITALS

A.           Company, Holdings, the other Credit Parties, Lenders and Administrative Agent are parties to a certain Credit and Guaranty Agreement, dated as of May 2, 2014 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement), pursuant to which the Lenders have made certain financial accommodations available to the Companies;

B.           Certain Events of Default have occurred and are continuing, including, without limitation, the Events of Default set forth on Schedule A to this Amendment (the “Designated Defaults”);

C.           Company, Holdings and Vertex Refining OH, LLC (“Vertex Refining OH”), an Ohio limited liability company, desire to acquire certain assets of Heartland Group Holdings, LLC (“Heartland”), a Delaware limited liability company, (such acquisition, the “Heartland Acquisition”) pursuant to that certain Asset Purchase Agreement by and among Company, Holdings, Vertex Refining OH and Heartland dated effective as of October 21, 2014 (as amended, restated, supplemented or otherwise modified from time to time); and

D.           Notwithstanding the Designated Defaults, Company has requested that the  Administrative Agent and Lenders consent to the Heartland Acquisition and amend certain provisions of the Credit Agreement and, subject to the terms and conditions hereof, the Administrative Agent and the Lenders executing this Amendment are willing to do so;

NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, and intending to be legally bound, the parties hereto agree as follows:

A.  ACKNOWLEDGEMENT OF DEFAULT; RESERVATION OF RIGHTS

1.      Each Credit Party acknowledges and agrees that as of the First Amendment Effective Date, the outstanding principal amount of the Term Loan was $39,400,000.00. The foregoing amount does not include interest, fees, expenses and other amounts that are chargeable or otherwise reimbursable under the Credit Agreement and the other Credit Documents.

2.      Each Credit Party acknowledges and agrees that (i) each of the Designated Defaults constitutes an Event of Default that has occurred and is continuing, (ii) none of the Designated Defaults has been cured or waived as of the date hereof, and (iii) except for the Designated Defaults, no other Events of Default have occurred and are continuing as of the date hereof.  Each of the Designated Defaults permits the Administrative Agent, Collateral Agent and Lenders (i) to accelerate the Obligations, (ii) to require payment of accrued default interest in respect of the Obligations (as of any date from and after the date on which the first Designated Default first occurred) and to convert all LIBOR Rate Loans into Base Rate Loans, (iii) to commence any legal or other action to collect any or all of the Obligations from any or all of Company, the other Credit Parties, and any other person liable therefor and/or any Collateral, (iv) to foreclose or otherwise realize on any or all of the Collateral and/or as appropriate, set-off or apply to the payment of any or all of the Obligations, any or all of the Collateral, (v) to take any other enforcement action or otherwise exercise any or all rights and remedies provided for by any or all of the Credit Agreement, other Credit Documents or applicable law, and (vi) to reject any forbearance, financial restructuring or other proposal made by or on behalf of Company, any other Credit Party or any creditor or equity holder.

3.      Each Credit Party further acknowledges and agrees that (i) nothing in this Amendment, including, without limitation, the amendments set forth in Section B and the consent set forth in Section C, constitutes a waiver, consent or agreement to forbear with respect to the Designated Defaults, and (ii) both prior to and after giving effect to this Amendment, the Administrative Agent, Collateral Agent and Lenders retain all rights, powers, privileges and remedies under the Credit Agreement, other Credit Documents and/or applicable law, including without limitation, the rights and remedies referred to in Section A(2).

B.AMENDMENTS

1.      Section 1.1 of the Credit Agreement is amended by inserting the following new definition in appropriate alphabetical order:

“First Amendment Effective Date” means December 5, 2014.

“Heartland Acquisition” means the acquisition by Vertex Refining OH of certain assets of Heartland Group Holdings, LLC, a Delaware limited liability company, pursuant to and in accordance with the terms set forth in the Heartland Purchase Agreement and this Agreement, and the payment by the Company of the transaction costs and expenses associated with such acquisition.

“Heartland Acquisition Documents” means the Heartland Purchase Agreement, the Vertex OH Shared Services Agreement, the Escrow Agreement (as defined in the Heartland Purchase Agreement), all leases of Vertex Refining OH with the Seller (as defined in the Heartland Purchase Agreement) and each other document entered into by Holdings or any of its Subsidiaries in connection with the Heartland Acquisition.

“Heartland Purchase Agreement” means that certain Asset Purchase Agreement, dated effective as of October 21, 2014, among Holdings, Company, Vertex Refining OH and Heartland Group Holdings, LLC, a Delaware limited liability company, as amended by that certain First Amendment to Asset Purchase Agreement, dated as of November 26, 2014, and that certain Second Amendment to Asset Purchase Agreement, dated as of December 5, 2014.

2

“Vertex OH Shared Services Agreement” means that certain Shared Services Agreement, dated as of December 5, 2014, between Vertex Refining OH and Company, as amended, restated, supplemented or otherwise modified in accordance with the terms of this Agreement.

“Vertex Refining OH” means Vertex Refining OH, LLC, an Ohio limited liability company.

2.      Section 1.1 of the Credit Agreement is further amended by making the following modifications to the definitions of “Consolidated Adjusted EBITDA”, “Permitted Acquisition” and “Subsidiary”:

a. the definition of “Consolidated Adjusted EBITDA” is amended by inserting the following new language at the end thereof:

Notwithstanding the foregoing, Vertex Refining OH shall be excluded from Consolidated Adjusted EBITDA pursuant to the  definition of “Subsidiary”.

b. the definition of “Permitted Acquisition” is amended by inserting the words “or (except with respect to the Heartland Acquisition) Vertex Refining OH” immediately after the words “Vertex Refining NV” and immediately prior to the parentheses; and

c. the definition of “Subsidiary” is amended by replacing such definition in its entirety with the following:

“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity of which more than 50% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof; provided, in determining the percentage of ownership interests of any Person controlled by another Person, no ownership interest in the nature of a “qualifying share” of the former Person shall be deemed to be outstanding.  Notwithstanding the foregoing, Vertex Refining OH and, to the extent that the Bango Acquisition is consummated and unless and until (x) the Bango Acquisition is consummated pursuant to Section 6.9(g)(i) with the consent of the Administrative Agent and (y) the Vertex NV EBITDA Election Notice has been delivered, Vertex Refining NV shall be deemed not to be Subsidiaries of Holdings solely for purposes of the definitions of Consolidated Adjusted EBITDA, Consolidated Capital Expenditures, Consolidated Cash Interest Expense, Consolidated Current Assets, Consolidated Current Liabilities, Consolidated Excess Cash Flow, Consolidated Fixed Charges, Consolidated Interest Expense, Consolidated Liquidity, Consolidated Net Income, Consolidated Pro Forma Adjusted EBITDA, Consolidated Total Debt, Consolidated Working Capital, Consolidated Working Capital Adjustment, Fixed Charge Coverage Ratio and Leverage Ratio.

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3.      Section 2.13 of the Credit Agreement is amended by replacing Section 2.13(c) in its entirety with the following:

(c)   Issuance of Equity Securities.  On the date of receipt by Holdings of any Cash proceeds from a capital contribution to, or the issuance of any Capital Stock of, Holdings or any of its Subsidiaries (other than Capital Stock issued (i) pursuant to any employee stock or stock option compensation plan, or (ii) for purposes approved in writing by Administrative Agent), Company shall prepay the Term Loans in an aggregate amount equal to 100% of such proceeds, net of underwriting discounts and commissions and other reasonable costs and expenses associated therewith, in each case, paid to Persons who are not Affiliates of Holdings, including reasonable legal fees and expenses. Notwithstanding the foregoing, no mandatory prepayment of the Term Loans shall be required (i) from the net proceeds of the Post Close Equity Raise or (ii) to the extent that the net proceeds from a capital contribution to, or the issuance of any Capital Stock of, Holdings are used (w) to prepay Capital Leases in an amount not to exceed $10,000,000 in the aggregate after the Closing Date, (x) for working capital purposes in an amount not to exceed $5,000,000, (y) to fund the working capital of Vertex Refining NV prior to the Vertex NV Ring Fence Termination Date and to fund working capital of Vertex Refining OH or (z) in connection with a Permitted Acquisition.

4.      Section 5.1 of the Credit Agreement is amended by replacing Sections 5.1(a) and 5.1(b) in their entirety with the following:

(a)   Monthly Reports.  As soon as available, and in any event within 30 days after the end of each month (including months which began prior to the Closing Date), the consolidated balance sheet of Holdings and its Subsidiaries and consolidating balance sheets of each of Vertex Refining NV and Vertex Refining OH, in each case as at the end of such month and the related consolidated statements of income, consolidated statements of stockholders’ equity and consolidated statements of cash flows of Holdings and its Subsidiaries and consolidating statements of income and cash flows of each of Vertex Refining NV and Vertex Refining OH, in each case for such month and for the period from the beginning of the then current Fiscal Year to the end of such month, setting forth in each case in comparative form the corresponding figures for the corresponding periods of the previous Fiscal Year and the corresponding figures from the Financial Plan for the current Fiscal Year, all in reasonable detail, together with a schedule of reconciliations for any reclassifications with respect to prior months or periods (and, in connection therewith, copies of any restated financial statements for any impacted month or period) a Financial Officer Certification with respect thereto and any other operating reports prepared by management for such period;

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(b)   Quarterly Financial Statements.  As soon as available, and in any event within 45 days after the end of each Fiscal Quarter of each Fiscal Year (including the fourth Fiscal Quarter), the consolidated balance sheets of Holdings and its Subsidiaries and the consolidating balance sheets of each of Vertex Refining NV and Vertex Refining OH, in each case as at the end of such Fiscal Quarter and the related consolidated statements of income, stockholders’ equity and cash flows of Holdings and its Subsidiaries and consolidating statements of income and cash flows of each of Vertex Refining NV and Vertex Refining OH, in each case for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in comparative form the corresponding figures for the corresponding periods of the previous Fiscal Year, all in reasonable detail, together with a Financial Officer Certification and a Narrative Report with respect thereto;

5.      Section 5.14(a) of the Credit Agreement is amended by inserting the following new language at the end thereof:

Holdings will cause the Credit Parties not to commingle their funds or assets with those of Vertex Refining OH, which shall maintain separate books and records, assets and funds for all purposes.

6.      Section 6.1(c) of the Credit Agreement is amended by inserting the following new language at the end thereof:

provided, further, that Vertex Refining OH shall not be permitted to guaranty any Indebtedness under or with respect to the ABL Credit Agreement;

7.      Section 6.1 is further amended by inserting the following new paragraph at the end thereof:

Notwithstanding the foregoing, at no time shall (x) Vertex Refining OH incur any Indebtedness pursuant to subsections (b), (c), (e), (g)(x), (g)(y) or (h) above, (y) the Company nor any other Subsidiary Guarantor lend any Indebtedness to Vertex Refining OH pursuant to subsection (b) above or guarantee any Indebtedness of Vertex Refining OH pursuant to subsection (e) above or (z) the accounts, inventory or other assets of Vertex Refining OH be included in the Borrowing Base (as defined in the ABL Credit Agreement).

8.      Section 6.2(a) of the Credit Agreement is amended by inserting the following new language at the end thereof:

provided, further, that no Liens on assets of Vertex Refining OH shall be permitted to secure Indebtedness permitted under Section 6.1(c) and 6.1(h);

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9.      Section 6.7(b) of the Credit Agreement is amended by replacing such Section in its entirety with the following:

(b)   equity Investments owned as of the Closing Date in any Subsidiary and Investments made after the Closing Date in any wholly owned Guarantor Subsidiary of Company; provided, that (x) no Investment may be made in Vertex Refining OH other than from the net cash proceeds from contemporaneous equity issuances by Holdings and (y) prior to the Vertex NV Ring Fence Termination Date, no Investment may be made in Vertex Refining NV other than equity Investments funded from the Vertex Refining Cash Collateral Account in accordance with Section 5.14(b) or from the net cash proceeds from contemporaneous equity issuances by Holdings;

10.      Section 6.7(c) of the Credit Agreement is amended by inserting the following new language at the end thereof:

provided, further, that no intercompany loans may be made to Vertex Refining OH;

11.      Section 6.7 of the Credit Agreement is further amended by (i) inserting “; and” at the end of Section 6.7(f), immediately prior to the period and (ii)  inserting the following new clause (g) immediately after Section 6.7(f):

(g)   Investments by Holdings in Vertex Refining OH to the extent funded with a contemporaneous issuance of common Capital Stock by Holdings.

12.      Section 6.8 of the Credit Agreement is amended by inserting the following new Section 6.8(f) at the end thereof:

(f)   Minimum Vertex OH Liquidity.  Holdings shall not permit unrestricted Cash and Cash Equivalents held by Vertex OH to be less than $500,000 at any time from and after the First Amendment Effective Date.

13.      Section 6.9(a) of the Credit Agreement is amended by replacing such Section in its entirety with the following:

(a)   any Subsidiary of Holdings may be merged with or into Company or any Guarantor Subsidiary, or be liquidated, wound up or dissolved, or all or any part of its business, property or assets may be conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or a series of transactions, to Company or any Guarantor Subsidiary; provided, that (x) in the case of such a merger, Company or such Guarantor Subsidiary, as applicable shall be the continuing or surviving Person and (y) in no event shall Vertex Refining OH or, unless and until the Vertex NV Ring Fence Termination Date has occurred, Vertex Refining NV be merged with or into Holdings or any of its other Subsidiaries, be liquidated, wound up or dissolved, or have all or any part of its business, property or assets conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or a series of transactions, to Holdings or any of its other Subsidiaries;

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14.      Section 6.9(i) of the Credit Agreement is amended by inserting the words “or Vertex Refining OH” immediately after the word “ESource”.

15.      Section 6.11 of the Credit Agreement is amended by inserting the following new language at the end thereof, immediately prior to the period:

; provided, further, that Vertex Refining OH shall not sell and lease back any property with Holdings or any of its other Subsidiaries

16.      Section 6.12 of the Credit Agreement is amended by replacing such Section in its entirety with the following:

Section 6.12.   Transactions with Shareholders and Affiliates.  No Credit Party shall, nor shall it permit any of its Subsidiaries to, directly or indirectly, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any holder of 5% or more of any class of Capital Stock of Holdings or any of its Subsidiaries (or any Affiliate of such holder) or with any Affiliate of Holdings or of any such holder; provided, however, that the Credit Parties and their Subsidiaries may enter into or permit to exist any such transaction if both (i) Administrative Agent has consented thereto in writing prior to the consummation thereof and (ii) the terms of such transaction are not less favorable to Holdings or that Subsidiary, as the case may be, than those that might be obtained at the time from a Person who is not such a holder or Affiliate; further, provided, that the foregoing restrictions shall not apply to (a) any transaction between Company and any Guarantor Subsidiary (except that unless and until the Vertex NV Ring Fence Termination Date has occurred, Vertex Refining NV shall not enter into any transaction with Holdings or its other Subsidiaries unless such transaction is subject to and in accordance with a master shared services agreement approved in writing by the Administrative Agent or otherwise approved in writing by the Administrative Agent); (b) reasonable and customary fees paid to members of the board of directors (or similar governing body) of Holdings and its Subsidiaries; (c) compensation arrangements for officers and other employees of Holdings and its Subsidiaries entered into in the ordinary course of business; (d) transactions under and in accordance with the Vertex OH Shared Services Agreement; (e) the purchase by Benjamin Paul Cowart, trustee of the Benjamin Paul Cowart 2012 GRAT U/A dated April 17, 2012 and by Shelley T. Cowart, trustee of the Shelley T. Cowart 2012 GRAT U/A dated April 17, 2012 (collectively, the "Cowart GRATs") of $1,500,000 of Capital Stock on or about the First Amendment Effective Date and the issuance by Holdings of warrants to the Cowart GRATs in connection therewith, the proceeds of which shall be contributed by Holdings to Vertex Refining OH and (f) transactions described in Schedule 6.12.  Company shall disclose in writing each transaction with any holder of 5% or more of any class of Capital Stock of Holdings or any of its Subsidiaries or with any Affiliate of Holdings or of any such holder to Administrative Agent.

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17.      Section 6.14 of the Credit Agreement is amended by inserting the words “or Vertex Refining OH” immediately after the words “Vertex Refining NV” in clause (f) of such Section.

18.      Section 6.15 of the Credit Agreement is amended by inserting the following sentence at the end of such Section:

No Credit Party shall nor shall it permit any of its Subsidiaries to, agree to any amendment, restatement, supplement or other modification to, or waiver of, any of its rights under any Heartland Acquisition Document without in each case obtaining the prior written consent of Administrative Agent and Requisite Lenders to such amendment, restatement, supplement or other modification or waiver.

C.CONSENT AND RESERVATION OF RIGHTS

Notwithstanding the failure of the Heartland Acquisition to satisfy the requirements of clauses (i), (ii), (iii), (vi), (vii), and (viii)(z) of the definition of “Permitted Acquisition” and the failure of the Credit Parties to satisfy the requirements of Sections 5.10 and 5.11 of the Credit Agreement with respect to Vertex Refining OH and the assets acquired in the Heartland Acquisition, subject to the conditions set forth in Section E below, the Administrative Agent and Lenders hereby (x) consent to the Heartland Acquisition and waive the requirements of clauses (i), (ii), (iii), (vi), (vii) and (viii)(z) of the definition of “Permitted Acquisition solely with respect to the Heartland Acquisition, (y) waive the requirements of Sections 5.10 and 5.11 with respect to Vertex Refining OH and the assets acquired in the Heartland Acquisition and (z) waive the prohibition on any Credit Party or its Subsidiaries becoming directly or indirectly liable to pay any “earn-out” or other deferred purchase price obligations with respect to any acquisition permitted under Section 6.9(h) or (i), solely with respect to any earn-out obligations incurred by Vertex Refining OH under the Heartland Purchase Agreement; provided, that (1) the Heartland Acquisition satisfies clauses (iv), (v), (viii)(y), (ix) and (x) of the definition of “Permitted Acquisition”, (2) the only cash consideration payable by the Credit Parties in connection with the Heartland Acquisition shall be (x) funded with the proceeds of a substantially contemporaneous issuance of common Capital Stock of Holdings and/or (y) following the closing date of the Heartland Acquisition, funded by internally generated cash flow of Vertex Refining OH,  and (3) except as permitted under clause (2), the only consideration payable in connection with the Heartland Acquisition is common Capital Stock of Holdings.

The Credit Parties acknowledge that (x) the consideration paid in connection with the Heartland Acquisition shall be included for purposes of determining whether clause (i) of the definition of “Permitted Acquisitions” is satisfied with respect to any future acquisitions and (y)

pursuant to Section 6.20, no Credit Party may make any “earn-out” payments or other similar payments if a Default or Event of Default exists at the time of such payment or would arise after giving effect to any such payment, unless such payment is made with common Capital Stock of Holdings, and the Company shall provide notice to the Administrative Agent prior to making any such payment, which notice shall demonstrate pro forma compliance with Section 6.8(d) after giving effect to such payment.

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The Credit Parties acknowledge that, by consenting to the Heartland Acquisition and granting the foregoing waivers, the Administrative Agent and the Lenders have not waived the Designated Defaults and each of Administrative Agent and the Lenders expressly reserves all of its rights, powers, privileges and remedies under the Credit Agreement, other Credit Documents and/or applicable law.  Each of Administrative Agent and the Lenders may exercise their respective rights, powers, privileges and remedies, including those set forth in the Credit Agreement, other Credit Documents or applicable law, at any time in its sole and absolute discretion without further notice.  No oral representations or course of dealing on the part of any Agent, any Lender or any of their respective officers, employees or agents, and no failure or delay by any Agent or any Lender with respect to the exercise of any right, power, privilege or remedy under any of the Credit Agreement, other Credit Documents or applicable law shall operate as a waiver thereof, and the single or partial exercise of any such right, power, privilege or remedy shall not preclude any later exercise of any other right, power, privilege or remedy.

D.RELEASE

1.      In consideration of, among other things, Administrative Agent’s, Collateral Agent’s and the Lenders’ execution and delivery of this Agreement, each of Company and the other Credit Parties, on behalf of itself and its agents, representatives, officers, directors, advisors, employees, subsidiaries, affiliates, successors and assigns (collectively, the “Releasors”), hereby forever agrees and covenants not to sue or prosecute against any Releasee (as hereinafter defined) and hereby forever waives, releases and discharges, to the fullest extent permitted by law, each Releasee from any and all claims (including, without limitation, crossclaims, counterclaims, rights of set-off and recoupment), actions, causes of action, suits, debts, accounts, interests, liens, promises, warranties, damages and consequential damages, demands, agreements, bonds, bills, specialties, covenants, controversies, variances, trespasses, judgments, executions, costs, expenses or claims whatsoever, that such Releasor now has or hereafter may have, of whatsoever nature and kind, whether known or unknown, whether now existing or hereafter arising, whether arising at law or in equity (collectively, the “Claims”), against Administrative Agent, Collateral Agent and the Lenders party hereto in any capacity and their respective affiliates, subsidiaries, and their respective successors and assigns and each and all of the officers, directors, employees, agents, attorneys, advisors and other representatives of each of the foregoing (collectively, the “Releasees”), based in whole or in part on facts, whether or not now known, existing on or before the date hereof, that relate to, arise out of or otherwise are in connection with: (i) any or all of the Credit Documents or transactions contemplated thereby or any actions or omissions in connection therewith or (ii) any aspect of the dealings or relationships between or among Company and the other Credit Parties, on the one hand, and any or all of Administrative Agent, Collateral Agent or the Lenders party hereto, on the other hand, relating to any or all of the documents, transactions, actions or omissions referenced in clause (i) hereof.  In entering into this Agreement, Company and each other Credit Party consulted with, and has been represented by, legal counsel and expressly disclaims any reliance on any representations, acts or omissions by any of the Releasees and hereby agrees and acknowledges that the validity and effectiveness of the releases set forth above do not depend in any way on any such representations, acts and/or omissions or the accuracy, completeness or validity thereof.  The provisions of this Section shall survive the termination of this Amendment, the Credit Agreement, the other Credit Documents and payment in full of the Obligations.

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2.      Company and other Credit Parties each hereby agrees that it shall be, jointly and severally, obligated to indemnify and hold the Releasees harmless with respect to any and all liabilities, obligations, losses, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever incurred by the Releasees, or any of them, whether direct, indirect or consequential, as a result of or arising from or relating to any proceeding by or on behalf of any Person, including, without limitation, the respective officers, directors, agents, trustees, creditors, partners or shareholders of Company, any other Credit Party, or any of their respective Subsidiaries, whether threatened or initiated, in respect of any claim for legal or equitable remedy under any statue, regulation or common law principle arising from or in connection with the negotiation, preparation, execution, delivery, performance, administration and enforcement of the Credit Agreement, the other Credit Documents, this Amendment or any other document executed and/or delivered in connection herewith or therewith; provided, that neither Company nor any other Credit Party shall have any obligation to indemnify or hold harmless any Releasee hereunder with respect to liabilities to the extent they result from the gross negligence or willful misconduct of that Releasee as finally determined by a court of competent jurisdiction.  If and to the extent that the foregoing undertaking may be unenforceable for any reason, Company and other Credit Parties each agrees to make the maximum contribution to the payment and satisfaction thereof that is permissible under applicable law.  The foregoing indemnity shall survive the termination of this Amendment, the Credit Agreement, the other Credit Documents and the payment in full of the Obligations.

3.      Each of Company and other Credit Parties, on behalf of itself and its successors, assigns, and other legal representatives, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any Claim released, remised and discharged by Company or any other Credit Party pursuant to Section D(1) hereof.  If Company, any other Credit Party or any of its successors, assigns or other legal representatives violates the foregoing covenant, Company and other Credit Parties, each for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by any Releasee as a result of such violation.

E.CONDITIONS TO EFFECTIVENESS

Notwithstanding any other provision of this Amendment and without affecting in any manner the rights of the Lenders hereunder, it is understood and agreed that this Amendment shall not become effective, including, without limitation, the amendments contained in Section B and the consent contained in Section C, and the Company shall have no rights hereunder until satisfaction of the following conditions precedent on or prior to December 5, 2014:

1. The Administrative Agent and Lenders shall have received each of the following documents, each dated as of the date hereof and in form and substance satisfactory to the Administrative Agent and Lenders:

a. executed counterparts to this Amendment from Company, each of the Guarantors and the Lenders;

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b. a fully executed amendment to the ABL Credit Agreement which consents to the Heartland acquisition;

c. a fully executed copy of the Vertex OH Shared Services Agreement;

d. fully executed copies of the Heartland Purchase Agreement (including all schedules and exhibits thereto), all amendments to the Heartland Purchase Agreement, and each other material document entered into in connection with the Heartland Acquisition, including, without limitation, the Escrow Agreement (as defined in the Heartland Purchase Agreement) and all leases with the Seller (as defined in the Heartland Purchase Agreement), each certified as being true, correct and complete by an Authorized Officer of Company;

e. (i) the results of a recent search, by a Person satisfactory to Collateral Agent, of all effective UCC financing statements (or equivalent filings) made with respect to any personal or mixed property of acquired in the Heartland Acquisition, together with copies of all such filings disclosed by such search, and (ii) UCC termination statements (or similar documents) duly executed by all applicable Persons for filing in all applicable jurisdictions as may be necessary to terminate any effective UCC financing statements (or equivalent filings) disclosed in such search (other than any such financing statements in respect of Permitted Liens);

f. a title report issued by a title company reasonably satisfactory to the Collateral Agent with respect to each Real Estate Asset to be purchased by Vertex Refining OH in the Heartland Acquisition, dated not more than thirty days prior to the First Amendment Effective Date and copies of all recorded documents listed as exceptions to title or otherwise referred to therein;

g. reports and other information, in form, scope and substance satisfactory to Administrative Agent, regarding environmental matters relating to the Real Estate Assets to be acquired or leased in the Heartland Acquisition, which reports shall include a Phase I Report for each of the Real Estate Assets specified by Administrative Agent; and

h. payoff or release letters from the lenders holding Liens on the assets to be acquired in the Heartland Acquisition together with all documents or instruments necessary to release all Liens securing Indebtedness owed to such lenders.

2. The Administrative Agent shall have received evidence in form and substance reasonably satisfactory to Administrative Agent demonstrating that on the date hereof, immediately after giving effect to this Amendment, the Heartland Acquisition and all other transactions contemplated to occur on the date hereof, Vertex Refining OH shall have unrestricted Cash and Cash Equivalents held in a separate account in the name of Vertex Refining OH in an amount at least equal to $1,500,000;

3. The Administrative Agent shall have received copies of all required consents, releases and terminations of liens and claims under the Heartland Purchase Agreement, including, without limitation, those set forth on Schedules 6.02(d) and 7.03(b) to the Heartland Purchase Agreement and the Heartland Acquisition shall have been consummated in compliance with (a) all applicable Requirements of Law and (b) the terms and provisions of the Heartland Purchase Agreement; the Heartland Acquisition Documents shall not have been amended, restated, supplemented or otherwise modified and no term thereof shall have been waived without the prior written consent of the Administrative Agent; and

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4. The Administrative Agent shall have received reimbursement or payment of its costs and expenses incurred in connection with this Amendment or the Credit Agreement (including reasonable fees, charges and disbursements of counsel to Administrative Agent).

5. The Administrative Agent shall have received correspondence in form and substance reasonably satisfactory to Administrative Agent from Reinhart Boerner Van Deuren s.c. ("Reinhart") to the effect that Reinhart has received not less than $1,500,000 in its client trust account from the issuance of Capital Stock by Holdings to the Cowart GRATs, and that upon the closing of the Heartland Acquisition and the execution and delivery of this Amendment by all parties hereto and the execution and delivery of the amendment referred to in Section E.1.b. hereof by all parties thereto, that Reinhart will transfer all such amounts to Vertex Refining OH.

F.REPRESENTATIONS

To induce the Lenders, Collateral Agent and Administrative Agent to enter into this Amendment, each Credit Party hereby represents and warrants to the Lenders, Collateral Agent and Administrative Agent that:

1.           Each of Holdings and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, (b) has all requisite power and authority to enter into this Amendment and to carry out the transactions contemplated hereby, and (c) is qualified to do business and in good standing in every jurisdiction where its assets are located and wherever necessary to carry out its business and operations, except in jurisdictions where the failure to be so qualified or in good standing has not had, and could not be reasonably expected to have, a Material Adverse Effect.

2.           The execution, delivery and performance of this Amendment have been duly authorized by all necessary action on the part of each Credit Party that is a party thereto.

3.           The execution, delivery and performance by Credit Parties of this Amendment and the consummation of the transactions contemplated hereby do not and will not (a) violate any provision of any law or any governmental rule or regulation applicable to Holdings or any of its Subsidiaries, any of the Organizational Documents of Holdings or any of its Subsidiaries, or any order, judgment or decree of any court or other agency of government binding on Holdings or any of its Subsidiaries; (b) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of Holdings or any of its Subsidiaries; (c) result in or require the creation or imposition of any Lien upon any of the properties or assets of Holdings or any of its Subsidiaries (other than any Liens created under any of the Credit Documents in favor of Collateral  Agent, on behalf of Secured Parties); or (d) require any approval of stockholders, members or partners or any approval or consent of any Person under any Contractual Obligation of Holdings or any of its Subsidiaries, except for such approvals or consents which will be obtained on or before the date hereof and disclosed in writing to Lenders.

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4.            The execution, delivery and performance by Credit Parties of this Amendment and the consummation of the transactions contemplated hereby do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any Governmental Authority.

5.            This Amendment has been duly executed and delivered by each Credit Party and is the legally valid and binding obligation of such Credit Party, enforceable against such Credit Party in accordance with its respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.

6.           After giving effect to this Amendment, the representations and warranties contained in the Credit Agreement and the other Credit Documents are true and correct in all material respects on and as of the date hereof to the same extent as though made on and as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties were true and correct in all material respects on and as of such earlier date, and, other than the Designated Defaults, no Default or Event of Default has occurred and is continuing as of the date hereof.

G.OTHER AGREEMENTS

1.           Continuing Effectiveness of Loan Documents.  As amended hereby, all terms of the Credit Agreement and the other Credit Documents shall be and remain in full force and effect and shall constitute the legal, valid, binding and enforceable obligations of the Credit Parties party thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.  To the extent any terms and conditions in any of the other Credit Documents shall contradict or be in conflict with any terms or conditions of the Credit Agreement, after giving effect to this Amendment, such terms and conditions are hereby deemed modified and amended accordingly to reflect the terms and conditions of the Credit Agreement as modified and amended hereby. Upon the effectiveness of this Amendment such terms and conditions are hereby deemed modified and amended accordingly to reflect the terms and conditions of the Credit Agreement as modified and amended hereby.  The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Lenders under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement.  This Amendment shall constitute a Credit Document for all purposes of the Credit Agreement.

2.           Reaffirmation of Guaranty.  Holdings and each other Guarantor consents to the execution and delivery by the Company of this Amendment and the consummation of the transactions described herein, and ratifies and confirms the terms of the Guaranty to which such Guarantor is a party with respect to the Indebtedness now or hereafter outstanding under the Credit Agreement as amended hereby and all promissory notes issued thereunder. Each Guarantor acknowledges that, notwithstanding anything to the contrary contained herein or in any other document evidencing any Indebtedness of Company to the Lenders or any other Obligation of Company, or any actions now or hereafter taken by the Lenders with respect to any Obligation of Company, the Guaranty to which any Guarantor is a party (i) is and shall continue to be a primary obligation of such Guarantor, (ii) is and shall continue to be an absolute, unconditional, continuing and irrevocable guaranty of payment, and (iii) is and shall continue to be in full force and effect in accordance with its terms.  Nothing contained herein to the contrary shall release, discharge, modify, change or affect the original liability of each Guarantor under the Guaranty to which such Guarantor is a party.

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3.           Acknowledgment of Perfection of Security Interest. Each Credit Party hereby acknowledges that, as of the date hereof, the security interests and Liens granted to Collateral Agent and the Lenders under the Credit Agreement and the other Credit Documents, including, without limitations, Liens granted under the Mortgages, are in full force and effect, are properly perfected and are enforceable in accordance with the terms of the Credit Agreement and the other Credit Documents.

4.           APPLICABLE LAW.   THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) THEREOF.

5.           No Novation.  This Amendment is not intended by the parties to be, and shall not be construed to be, a novation of the Credit Agreement and the other Credit Documents or an accord and satisfaction in regard thereto.

6.           Costs and Expenses.  The Company agrees to pay on demand all costs and expenses of Administrative Agent in connection with the preparation, execution and delivery of this Amendment, including, without limitation, the reasonable fees and out-of-pocket expenses of outside counsel for Administrative Agent with respect thereto.

7.           Counterparts.  This Amendment may be executed by one or more of the parties hereto in any number of separate counterparts, each of which shall be deemed an original and all of which, taken together, shall be deemed to constitute one and the same instrument.  Delivery of an executed counterpart of this Amendment by facsimile transmission or electronic transmission shall be as effective as delivery of a manually executed counterpart hereof.

8.           Binding Nature.  This Amendment shall be binding upon and inure to the benefit of the parties hereto, their respective successors, successors-in-titles, and assigns.  No third party beneficiaries are intended in connection with this Amendment.

9.           Entire Understanding.  This Amendment sets forth the entire understanding of the parties with respect to the matters set forth herein, and shall supersede any prior negotia­tions or agreements, whether written or oral, with respect thereto.

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the date first written above.

VERTEX ENERGY OPERATING, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX ENERGY, INC.

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX ACQUISITION SUB, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX MERGER SUB, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX REFINING NV, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX REFINING LA, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

CEDAR MARINE TERMINALS, LP

CROSSROAD CARRIERS, L.P.

VERTEX RECOVERY, L.P.

H & H OIL, LP.

By:            Vertex II GP, LLC,

    as sole general partner of each of the foregoing

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX II GP, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

GOLDEN STATE LUBRICANTS WORKS, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

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GOLDMAN SACHS BANK USA, a New York State-Chartered Bank, as Administrative Agent, Collateral Agent and Lender

By:  /s/ Stephen W. Hipp                               

Stephen W. Hipp

Authorized Signatory

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Schedule A

a) Event of Default under Section 8.1(a) of the Credit Agreement due to the failure of the Company to prepay the Term Loans pursuant to Section 2.13(g) of the Credit Agreement in an amount equal to $6,299,567.00 due to (x) Consolidated Total Debt exceeding (y) Consolidated Pro Forma Adjusted EBITDA for the twelve month period ending on August 31, 2014, multiplied by the maximum Leverage Ratio permitted under Section 6.8(b) of the Credit Agreement with respect to the Fiscal Quarter ending on June 30, 2014.

b) Event of Default under Section 8.1(a) of the Credit Agreement due to the failure of the Company to prepay the Term Loans pursuant to Section 2.13(g) of the Credit Agreement in an amount to be determined due to (x) Consolidated Total Debt exceeding (y) Consolidated Pro Forma Adjusted EBITDA for the twelve month period ending on September 30, 2014, multiplied by the maximum Leverage Ratio permitted under Section 6.8(b) of the Credit Agreement with respect to the Fiscal Quarter ending on September 30, 2014.

c) Events of Default under Section 8.1(b) of the Credit Agreement due to the failure of the Company to satisfy the requirements of Items 2, 3, 4 and 6 of that certain Post-Closing Letter Agreement, dated May 2, 2014, among the Company, Holdings and the ABL Agent in violation of Section 11.2 of the ABL Credit Agreement;

d) Event of Default under Section 8.1(b)(iii) of the Credit Agreement due to the occurrence and continuation of “Defaults” (as defined in the ABL Credit Agreement) under the ABL Credit Agreement as set forth in greater detail in that certain Notice of Event of Default, dated as of November 6, 2014.

e) Event of Default under Section 8.1(c) of the Credit Agreement due to the failure of Holdings to timely deliver to Administrative Agent and Lenders the financial statements set forth in Sections 5.1(a), 5.1(d) and 5.1(v) for the month ending on September 30, 2014.

f) Event of Default under Section 8.1(c) of the Credit Agreement due to the failure of Holdings to comply with Section 5.13 to immediately deposit the net cash proceeds from the Post Close Equity Raise into the Vertex Refining Cash Collateral Account.

g) Event of Default under Section 8.1(c) of the Credit Agreement due to the failure of Holdings to comply with the requirements set forth in Section 6.8(a) by permitting the Fixed Charge Coverage Ratio as of the last day of the Fiscal Quarter ending September 30, 2014 to be less than 1.10:1.00;

h) Event of Default under Section 8.1(c) of the Credit Agreement due to the failure of Holdings to comply with the requirements set forth in Section 6.8(b) by permitting the Leverage Ratio as the last day of Fiscal Quarter ending September 30, 2014 to exceed 4.00:1.00;

i) Event of Default under Section 8.1(c) of the Credit Agreement due to the failure of Holdings to comply with the requirements set forth in Section 6.8(c) by permitting the Consolidated Adjusted EBITDA as of the end of the Fiscal Quarter ending September 30, 2014 to be less than $7,750,000;

j) Event of Default under Section 8.1(c) of the Credit Agreement due to the failure of Holdings to comply with the requirements set forth in Section 6.8(d) by permitting the Consolidated Liquidity to be less than $3,000,000 at any time from and after the Closing Date;

k) Event of Default under Section 8.1(c) of the Credit Agreement due to the formation of Vertex Refining OH in violation of Section 6.13 of the Credit Agreement;

l) Events of Default under Section 8.1(c) of the Credit Agreement due to the entry by Holdings into non-binding Letters of Intent with certain third parties in violation of Section 6.14 of the Credit Agreement;

m) Event of Default under Section 8.1(c) of the Credit Agreement due to the entry by Company into that certain Consulting Agreement with Heartland Group Holdings, LLC dated July 18, 2014.

n) Event of Default under Section 8.1(c) of the Credit Agreement due to the entry by Holdings into that certain Asset Purchase Agreement, dated as of October 21, 2014 with certain third parties in violation of Section 6.14 of the Credit Agreement; and

o) Events of Default under Section 8.1(e) of the Credit Agreement due to the failure of the Company to satisfy the requirements of (i) Items 6 and 8 of Schedule 5.15 within thirty days following the dates set forth on such Schedule 5.15 and (ii) Items 2, 3, 4 and 9 of Schedule 5.15 within ninety days following the dates set forth on such Schedule 5.15 in violation of Section 5.15 of the Credit Agreement.

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EX-10.4

Exhibit 10.4

FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) is entered into as of December 5, 2014 (the “First Amendment Effective Date”), by and among VERTEX ENERGY OPERATING, LLC, a Texas limited liability company (“Vertex-Operating”), VERTEX ENERGY, INC., a Nevada corporation (“Holdings” and together with Vertex-Operating, “Borrowers” and each individually, a “Borrower”), and BANK OF AMERICA, N.A. (“Lender”), and acknowledged and agreed to by the Guarantors party hereto.

RECITALS

A.           Vertex-Operating, Holdings, and Lender are parties to that certain Amended and Restated Credit Agreement, dated as of May 2, 2014 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement);

B.           Certain Events of Default have occurred and are continuing, including, without limitation, the Events of Default set forth on Schedule A to this Amendment (the “Designated Defaults”);

C.           Holdings formed a new subsidiary, Vertex Refining OH, LLC (“Vertex Refining OH”), an Ohio limited liability company, on August 28, 2014.

D.           Vertex-Operating, Holdings and Vertex Refining OH desire to acquire certain assets of Heartland Group Holdings, LLC (“Heartland”), a Delaware limited liability company, (such acquisition, the “Heartland Acquisition”) pursuant to that certain Asset Purchase Agreement by and among Vertex-Operating, Holdings, Vertex Refining OH and Heartland dated effective as of October 21, 2014 (as amended, restated, supplemented or otherwise modified from time to time); and

E.           Notwithstanding the Designated Defaults, Borrowers have requested that Lender consent to the Heartland Acquisition and amend certain provisions of the Credit Agreement and, subject to the terms and conditions hereof, Lender is willing to do so;

NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, and intending to be legally bound, the parties hereto agree as follows:

A.           ACKNOWLEDGEMENT OF DEFAULT; RESERVATION OF RIGHTS

1.           Lender is not obligated to make or continue any Credit Extensions to Borrowers while any of the Designated Defaults exist and are continuing or any other Event of Defaults exists.  Any Credit Extension to Borrowers after the First Amendment Effective Date shall be in Lender’s sole discretion and subject to obtaining internal credit approval. Each request by Borrowers to Lender for a Credit Extension must be accompanied by updated financial projections, including a forecast balance sheet, income statement and rolling 13-week cash forecast, and if an Event of Default exists at the time such Credit Extension is made, a written release by each Company of all claims against Lender, in form acceptable to Lender.   If Lender elects in its sole discretion to make a Loan or other Credit Extension to Borrowers under the Credit Agreement, Lender shall not be obligated to make any additional or subsequent Loan or other Credit Extension to Borrowers. 

2.           Each Company acknowledges and agrees that (i) each of the Designated Defaults constitutes an Event of Default that has occurred and is continuing, (ii) none of the Designated Defaults has been cured or waived as of the date hereof, and (iii) except for the Designated Defaults, no other Events of Default have occurred and are continuing as of the date hereof.  Each of the Designated Defaults permits Lender (i) to accelerate the Obligation, (ii) to require payment of accrued default interest in respect of the Obligation (as of any date from and after the date on which the first Designated Default first occurred) and to convert any or all LIBOR Loans into Base Rate Loans, (iii) to commence any legal or other action to collect any or all of the Obligation from any Company or all of Companies, and any other person liable therefor and/or any Collateral, (iv) to foreclose or otherwise realize on any or all of the Collateral and/or as appropriate, set-off or apply to the payment of any or all of the Obligation, any or all of the Collateral, (v) to take any other enforcement action or otherwise exercise any or all rights and remedies provided for by any or all of the Credit Agreement, the other Loan Documents or applicable law, and (vi) to reject any forbearance, financial restructuring or other proposal made by or on behalf of any Company or any creditor or equity holder.

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3.           Each Company further acknowledges and agrees that (i) nothing in this Amendment, including, without limitation, the amendments set forth in Section B and the consent set forth in Section C, constitutes a waiver, consent or agreement to forbear with respect to the Designated Defaults, and (ii) both prior to and after giving effect to this Amendment, Lender retains all rights, powers, privileges and remedies under the Credit Agreement, the other Loan Documents and/or applicable law, including without limitation, the rights and remedies referred to in Section A(2).

B.           AMENDMENTS

1.           Section 1.1 of the Credit Agreement is amended by inserting the following new definitions in their appropriate alphabetical order:

“Capital Stock” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including, without limitation, partnership interests and membership interests, and any and all warrants, rights or options to purchase or other arrangements or rights to acquire any of the foregoing.

“Cash” means money, currency or a credit balance in any demand or deposit account; provided, however, that notwithstanding anything to the contrary contained herein, for purposes of calculating compliance with the requirements of Section 10 hereof “Cash” shall exclude any amounts that would not be considered “cash” under GAAP or “cash” as recorded on the books of the Borrowers and the Guarantors.

“Cash Equivalents” means, as at any date of determination, (i) marketable securities (a) issued or directly and unconditionally guaranteed as to interest and principal by the United States Government, or (b) issued by any agency of the United States the obligations of which are backed by the full faith and credit of the United States, in each case maturing within one year after such date; (ii) marketable direct obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (iii) commercial paper maturing no more than one year from the date of creation thereof and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (iv) certificates of deposit or bankers’ acceptances maturing within one year after such date and issued or accepted by any Lender or by any commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia that (a) is at least “adequately capitalized” (as defined in the regulations of its primary Federal banking regulator), and (b) has Tier 1 capital (as defined in such regulations) of not less than $100,000,000; and (v) shares of any money market mutual fund that (a) has substantially all of its assets invested continuously in the types of investments referred to in clauses (i) and (ii) above, (b) has net assets of not less than $500,000,000, and (c) has the highest rating obtainable from either S&P or Moody’s.

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“Contractual Obligation” means, as applied to any Person, any provision of any security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by it or any of its properties is bound or to which it or any of its properties is subject.

“First Amendment Effective Date” means December 5, 2014.

“Heartland Acquisition” means the acquisition by Vertex Refining OH of certain assets of Heartland Group Holdings, LLC, a Delaware limited liability company, pursuant to and in accordance with the terms set forth in the Heartland Purchase Agreement and this Amendment, and the payment by Vertex-Operating of transaction costs and expenses incurred in order to consummate the closing of such acquisition.

“Heartland Acquisition Documents” means the Heartland Purchase Agreement, the Vertex OH Shared Services Agreement, the Escrow Agreement (as defined in the Heartland Purchase Agreement), all leases of Vertex Refining OH with the Seller (as defined in the Heartland Purchase Agreement) and each other document entered into by Holdings or any of its Subsidiaries in connection with the Heartland Acquisition,

“Heartland Purchase Agreement” means that certain Asset Purchase Agreement, dated effective as of October 21, 2014, among Holdings, Vertex-Operating, Vertex Refining OH and Heartland Group Holdings, LLC, a Delaware limited liability company, as amended by that certain First Amendment to Asset Purchase Agreement dated as of November 26, 2014 and that certain Second Amendment to Asset Purchase Agreement dated as of December 5, 2014.

“Real Estate Asset” means, at any time of determination, any interest (fee, leasehold or otherwise) then owned by any company in any real property.

“Vertex OH Shared Services Agreement” means that certain Shared Services Agreement, dated as of December 5, 2014, between Vertex Refining OH and Vertex-Operating, as amended, restated, supplemented or otherwise modified in accordance with the terms of this Agreement.

“Vertex Refining OH” means Vertex Refining OH, LLC, an Ohio limited liability company.

2.           The defined term “Company” contained in Section 1.1 of the Credit Agreement is amended by adding the following sentence at the end thereof:

“In addition, Vertex Refining OH shall be deemed not to be a “Company” for purposes of determining the financial covenants set forth in this Agreement, whether used in determining the Applicable Margin, measuring the financial covenants set forth in Section 10 hereof (other than Section 10.6), determining the Borrowing Base or otherwise, including, without limitation, determining the Leverage Ratio and Consolidated Total Debt.”

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3.           Clause (b) of the definition of “Permitted Debt” in Section 1.1 of the Credit Agreement is amended by inserting the following new language at the end of such clause (b): “provided, further, that Vertex Refining OH shall not be permitted to guaranty any Debt under or with respect to the GS Term Loan Agreement;”

4.           Section 2.3(c)(iii)(b) of the Credit Agreement is amended by replacing Section 2.3(c)(iii)(b) in its entirety with the following:

“(b)  if such Net Proceeds are used in accordance with the terms of Section 2.13(c) of the GS Term Loan Agreement as in effect on the First Amendment Effective Date, or”

5.           Section 8.1(b) of the Credit Agreement is amended by replacing the parenthetical “(and the consolidating financial statements of Vertex-NV)” where it appears with the following parenthetical:

“(and the consolidating financial statements of Vertex-NV and of Vertex Refining OH)”

6.           Section 8.1(d) of the Credit Agreement is amended by replacing Section 8.1(d) in its entirety with the following:

“(d)  Promptly after preparation, and in any event within 30 days after the end of each month, the consolidated balance sheet of Holdings and its Subsidiaries and consolidating balance sheet of Vertex-NV and of Vertex Refining OH, in each case as at the end of such month and the related consolidated statements of income, consolidated statements of stockholders’ equity and consolidated statements of cash flows of Holdings and its Subsidiaries and consolidating statements of income and cash flows of Vertex-NV and of Vertex Refining OH, in each case for such month and for the period from the beginning of the then current fiscal year to the end of such month, which are identical in form and substance to the monthly financial reports required to be delivered to the Term Loan Agent under the GS Term Loan Agreement;”

7.           Section 8.17 of the Credit Agreement is amended by inserting the following new clause (d) at the end thereof:

 “(d)  No Commingling.  Borrowers will not commingle, and Borrowers will cause each Subsidiary not to commingle, their funds or assets with those of Vertex Refining OH, which shall maintain separate books and records, assets and funds for all purposes.”

8.           Section 9.11 of the Credit Agreement is amended by replacing such Section in its entirety with the following:

“9.11.   Transactions with Shareholders and Affiliates.  No Borrower shall, nor shall it permit any of its Subsidiaries to, directly or indirectly, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any holder of 5% or more of any class of Capital Stock of Holdings or any of its Subsidiaries (or any Affiliate of such holder) or with any Affiliate of Holdings or of any such holder; provided, however, that the each Company may enter into or permit to exist any such transaction if both (i) Lender in its sole discretion has consented thereto in writing prior to the consummation thereof and (ii) the terms of such transaction are not less favorable to Borrowers or such Subsidiary, as the case may be, than those that might be obtained at the time from a Person who is not such a holder or Affiliate; further, provided, that the foregoing restrictions shall not apply to (a) any transaction between Borrowers and any Guarantor permitted under the terms of this Agreement (except that unless and until the Vertex-NV Ring Fence Termination Date has occurred, Vertex-NV shall not enter into any transaction with Holdings or its other Subsidiaries unless such transaction is subject to and in accordance with a master shared services agreement approved in writing by Lender or otherwise approved in writing by Lender); (b) reasonable and customary fees paid to members of the board of directors (or similar governing body) of Holdings and its Subsidiaries; (c) compensation arrangements for officers and other employees of Holdings and its Subsidiaries entered into in the ordinary course of business; (d) transactions under and in accordance with the Vertex OH Shared Services Agreement; (e) the purchase by Benjamin Paul Cowart, trustee of the Benjamin Paul Cowart 2012 GRAT U/A dated April 17, 2012 and by Shelley T. Cowart, trustee of the Shelley T. Cowart 2012 GRAT U/A dated April 17, 2012 (collectively, the “Cowart GRATs”) of $1,500,000 of Capital Stock on or about the First Amendment Effective Date and the issuance by Holdings of warrants to the Cowart GRATs in connection therewith, the proceeds of which shall be contributed by Holdings to Vertex Refining OH, and (f) transactions described in Schedule 7.15.  Borrowers shall disclose in writing each transaction with any holder of 5% or more of any class of Capital Stock of Holdings or any of its Subsidiaries or with any Affiliate of Holdings or of any such holder to Lender.”

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9.           Section 9 of the Credit Agreement is amended by inserting the following new Section 9.15 at the end of thereof:

“9.15   Vertex Refining OH.

(a)       Notwithstanding anything to the contrary in Section 9.1, Vertex Refining OH may obtain loans from financial institutions other than Lender or lenders party to the GS Term Loan Agreement, provided that at no time shall (i) Vertex Refining OH accept any loans or investments from Borrowers or any Guarantor, (ii) any Company guarantee, secure, provide credit support or in any way become obligated on any debt, obligations or liabilities (whether contingent, matured, or unmatured) of Vertex Refining OH, and (iii) any accounts, inventory or other assets of Vertex Refining OH be included in the Borrowing Base.

(b)       Notwithstanding anything to the contrary in Section 9.2, Vertex Refining OH may grant liens to secure its debt provided that such debt is permitted to be incurred under preceding clause (a).

(c)       Notwithstanding anything to the contrary in Section 9.4, no investments shall be made by any Company in Vertex Refining OH, except for investments made by Holdings in Vertex Refining OH from the proceeds of an issuance of common stock by Holdings.

(d)       No Company may make any intercompany loans or other extensions of credit to Vertex Refining OH, and neither Vertex Refining OH nor any Company may make any “earn-out” payment or similar payments under the Heartland Acquisition if a Default or Event of Default exists at the time of such payment or would arise after giving effect to any such payment, unless such payment is made solely with proceeds of an issuance of common stock of Holdings, or from cash on hand generated by Vertex Refining OH in its business, and Borrowers shall provide notice to Lender prior to such payment being made and shall further demonstrate that such payment is permitted to be made under the GS Term Loan Agreement.

(e)       Notwithstanding any to the contrary in Section 9.6, in no event shall Vertex Refining OH be merged with or into Holdings or any of its other Subsidiaries.  Furthermore, in no event shall Vertex Refining OH voluntarily liquidate, merge, dissolve with or into Holdings or any of its other Subsidiaries, or have any part of its business, property or assets conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or a series of transactions, to Holdings or any of its other Subsidiaries.

(f)       No Company shall agree to, nor shall it permit any of its Subsidiaries to agree to, any amendment, restatement, supplement or other modification to, or waiver of, any of its rights under any Heartland Acquisition Document without in each case obtaining the prior written consent of Lender to such amendment, restatement, supplement or other modification or waiver.

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(g)       Following the closing of the Heartland Acquisition, Vertex Refining OH is permitted to pay, directly from cash on hand generated by Vertex Refining OH in its business, or from the proceeds of a common stock issuance by Holdings, (i) for out of pocket costs of Vertex Refining OH for certain cleanup costs related to the Norwalk facility, but not to exceed $200,000 in the aggregate, and (ii) for certain capital expenditure upgrades to the Heartland facilities not to exceed $1,300,000 in the aggregate.

(h)       Vertex Refining OH shall be not be included as a “Subsidiary” for purposes of determining the financial covenants set forth in this Agreement, whether used in determining the Applicable Margin, measuring the financial covenants set forth in Section 10 hereof (other than Section 10.6), determining the Borrowing Base or otherwise, including, without limitation, determining the Leverage Ratio and Consolidated Total Debt.”

10.           Section 10 of the Credit Agreement is amended by inserting the following new Section 10.6 at the end thereof:

“10.6   Minimum Vertex OH Liquidity.  Borrowers shall not permit unrestricted Cash and Cash Equivalents held by Vertex Refining OH to be less than $500,000 at any time from and after the First Amendment Effective Date.”

C.           CONSENT AND RESERVATION OF RIGHTS

1.           Notwithstanding the failure of the Heartland Acquisition to satisfy the requirements of the definition of “Permitted Acquisition” and the failure of the Companies to satisfy the requirements of Sections 6.1 and 6.3 of the Credit Agreement with respect to Vertex Refining OH and the assets acquired in the Heartland Acquisition, subject to the conditions set forth in Section E below, Lender hereby consents to the Heartland Acquisition in accordance with the terms of the Heartland Purchase Agreement and the other Heartland Acquisition Documents and waives the requirements of the definition of “Permitted Acquisition” and the failure of the Borrowers to satisfy the requirements of Sections 6.1 and 6.3 of the Credit Agreement with respect to Vertex Refining OH; provided, that (x) the Heartland Acquisition must satisfy clauses (d), (e), (g)(y), and (h), of the definition of “Permitted Acquisition” and (y) the only consideration payable by Borrowers and their Subsidiaries in connection with the Heartland Acquisition shall be common stock of Holdings and other cash amounts expressly permitted to be paid under Section 9.15 of the Credit Agreement.

2.           By consenting to the Heartland Acquisition and waiving the requirements set forth in paragraph C.1 above, Borrowers and each Guarantor acknowledge that Lender has not waived the Designated Defaults and Lender expressly reserves all of its rights, powers, privileges and remedies under the Credit Agreement, other Loan Documents and/or applicable law.  Lender may exercise all of its powers, privileges and remedies, including those set forth in the Credit Agreement, the other Loan Documents or applicable law, at any time in its sole and absolute discretion without further notice.  No oral representations or course of dealing on the part of Lender or any of its officers, employees or agents, and no failure or delay by Lender with respect to the exercise of any right, power, privilege or remedy under any of the Credit Agreement, the other Loan Documents or applicable law shall operate as a waiver thereof, and the single or partial exercise of any such right, power, privilege or remedy shall not preclude any later exercise of any other right, power, privilege or remedy.

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D.           RELEASE

1.           In consideration of, among other things, Lender’s execution and delivery of this Agreement, each Borrower and the other Companies, on behalf of itself and its agents, representatives, officers, directors, advisors, employees, subsidiaries, affiliates, successors and assigns (collectively, the “Releasors”), hereby forever agrees and covenants not to sue or prosecute against any Releasee (as hereinafter defined) and hereby forever waives, releases and discharges, to the fullest extent permitted by law, each Releasee from any and all claims (including, without limitation, crossclaims, counterclaims, rights of set-off and recoupment), actions, causes of action, suits, debts, accounts, interests, liens, promises, warranties, damages and consequential damages, demands, agreements, bonds, bills, specialties, covenants, controversies, variances, trespasses, judgments, executions, costs, expenses or claims whatsoever, that such Releasor now has or hereafter may have, of whatsoever nature and kind, whether known or unknown, whether now existing or hereafter arising, whether arising at law or in equity (collectively, the “Claims”), against Lender in any capacity and its affiliates, subsidiaries, and its successors and assigns and each and all of the officers, directors, employees, agents, attorneys, advisors and other representatives of each of the foregoing (collectively, the “Releasees”), based in whole or in part on facts, whether or not now known, existing on or before the date hereof, that relate to, arise out of or otherwise are in connection with: (i) any or all of the Loan Documents or transactions contemplated thereby or any actions or omissions in connection therewith or (ii) any aspect of the dealings or relationships between or among the Borrowers and the other Companies, on the one hand, and Lender, on the other hand, relating to any or all of the documents, transactions, actions or omissions referenced in clause (i) hereof.  In entering into this Agreement, each Borrower and each other Company consulted with, and has been represented by, legal counsel and expressly disclaims any reliance on any representations, acts or omissions by any of the Releasees and hereby agrees and acknowledges that the validity and effectiveness of the releases set forth above do not depend in any way on any such representations, acts and/or omissions or the accuracy, completeness or validity thereof.  The provisions of this Section shall survive the termination of this Amendment, the Credit Agreement, the other Loan Documents and payment in full of the Obligation.

2.           Each Company hereby agrees that it shall be, jointly and severally, obligated to indemnify and hold the Releasees harmless with respect to any and all liabilities, obligations, losses, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever incurred by the Releasees, or any of them, whether direct, indirect or consequential, as a result of or arising from or relating to any proceeding by or on behalf of any Person, including, without limitation, the respective officers, directors, agents, trustees, creditors, partners or shareholders of each Company, or any of their respective Subsidiaries, whether threatened or initiated, in respect of any claim for legal or equitable remedy under any statue, regulation or common law principle arising from or in connection with the negotiation, preparation, execution, delivery, performance, administration and enforcement of the Credit Agreement, the other Loan Documents, this Amendment or any other document executed and/or delivered in connection herewith or therewith; provided, that no Company shall have any obligation to indemnify or hold harmless any Releasee hereunder with respect to liabilities to the extent they result from the gross negligence or willful misconduct of that Releasee as finally determined by a court of competent jurisdiction.  If and to the extent that the foregoing undertaking may be unenforceable for any reason, each Company agrees to make the maximum contribution to the payment and satisfaction thereof that is permissible under applicable law.  The foregoing indemnity shall survive the termination of this Amendment, the Credit Agreement, the other Loan Documents and the payment in full of the Obligation.

3.           Each of Company on behalf of itself and its successors, assigns, and other legal representatives, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any Claim released, remised and discharged by any Company pursuant to Section D(1) hereof.  If any Company or any of its successors, assigns or other legal representatives violates the foregoing covenant, each Company, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by any Releasee as a result of such violation.

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E.                                CONDITIONS TO EFFECTIVENESS

Notwithstanding any other provision of this Amendment and without affecting in any manner the rights of Lender hereunder, it is understood and agreed that this Amendment shall not become effective, including, without limitation, the amendments contained in Section B and the consent contained in Section C, and no Company shall have any rights hereunder until satisfaction of the following conditions precedent on or prior to December 5, 2014:

1.           Lender shall have received each of the following documents, each dated as of the date hereof and in form and substance satisfactory to Lender:

a. executed counterparts to this Amendment from Borrowers, each of the Guarantors and the Lender and to the Fee Letter executed by Borrowers and Lender in connection with this Amendment;

b. a fully executed amendment to the GS Term Loan Agreement which consents to the Heartland Acquisition;

c. a fully executed copy of the Vertex OH Shared Services Agreement;

d. fully executed copies of the Heartland Purchase Agreement (including all schedules and exhibits thereto), all amendments to the Heartland Purchase Agreement, and each other material document entered into in connection with the Heartland Acquisition, including, without limitation, the Escrow Agreement (as defined in the Heartland Purchase Agreement) and all leases with the Seller (as defined in the Heartland Purchase Agreement), each certified as being true, correct and complete by an Authorized Officer of Company;

e. (i) the results of a recent search, by a Person satisfactory to Lender, of all effective UCC financing statements (or equivalent filings) made with respect to any personal or mixed property acquired in the Heartland Acquisition, together with copies of all such filings disclosed by such search, and (ii) UCC termination statements (or similar documents) duly executed by all applicable Persons for filing in all applicable jurisdictions as may be necessary to terminate any effective UCC financing statements (or equivalent filings) disclosed in such search (other than any such financing statements in respect of Permitted Liens);

f. a title report issued by a title company reasonably satisfactory to Lender with respect to each Real Estate Asset to be purchased by Vertex Refining OH in the Heartland Acquisition, dated not more than thirty days prior to the First Amendment Effective Date and copies of all recorded documents listed as exceptions to title or otherwise referred to therein;

g. reports and other information, in form, scope and substance satisfactory to Lender, regarding environmental matters relating to the Real Estate Assets to be acquired or leased in the Heartland Acquisition, which reports shall include a Phase I Report for each of the Real Estate Assets specified by Lender; and

h. payoff or release letters from the lenders holding Liens on the assets to be acquired in the Heartland Acquisition together with all documents or instruments necessary to release all Liens securing Indebtedness owed to such lenders.

2.           Lender shall have received evidence in form and substance reasonably satisfactory to Lender demonstrating that on the date hereof, immediately after giving effect to this Amendment, the Heartland Acquisition and all other transactions contemplated to occur on the date hereof, Vertex Refining OH shall have unrestricted Cash and Cash Equivalents held in a separate account in the name of Vertex Refining OH in an amount at least equal to $1,500,000.

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3.           Lender shall have received copies of all required consents, releases and terminations of liens and claims under the Heartland Purchase Agreement, including, without limitation, those set forth on Schedules 6.02(d)and 7.03(b) to the Heartland Purchase Agreement and the Heartland Acquisition shall have been consummated in compliance with (a) all applicable laws and (b) the terms and provisions of the Heartland Purchase Agreement; the Heartland Acquisition Documents shall not have been amended, restated, supplemented or otherwise modified and no term thereof shall have been waived without the prior written consent of Lender.

4.           Lender shall have received reimbursement or payment of its costs and expenses incurred in connection with this Amendment or the Credit Agreement (including reasonable fees, charges and disbursements of counsel to Lender).

5.           Lender shall have received correspondence in form and substance reasonably satisfactory to Lender from Reinhart Boerner Van Deuren s.c. (“Reinhart”) to the effect that Reinhart has received not less than $1,500,000 in its client trust account from the issuance of Capital Stock by Holdings to the Cowart GRATs, and that upon the closing of the Heartland Acquisition and the execution and delivery of this Amendment by all parties hereto and the execution and delivery of the amendment to the GS Term Loan Agreement referred to in Section E.1.b. hereof by all parties thereto, that Reinhart will transfer all such amounts to Vertex Refining OH.

6.           Lender shall have received payment of the amendment fee which is due and payable under the terms of that certain Fee Letter dated of even date herewith among Borrowers and Lender.

F.           REPRESENTATIONS AND WARRANTIES

To induce Lender to enter into this Amendment, each Company hereby represents and warrants to Lender that:

1.           Each of Holdings and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, (b) has all requisite power and authority to enter into this Amendment and to carry out the transactions contemplated hereby, and (c) is qualified to do business and in good standing in every jurisdiction where its assets are located and wherever necessary to carry out its business and operations, except in jurisdictions where the failure to be so qualified or in good standing has not had, and could not be reasonably expected to have, a Material Adverse Effect.

2.           The execution, delivery and performance of this Amendment have been duly authorized by all necessary action on the part of each Company that is a party thereto.

3.           The execution, delivery and performance by each Company of this Amendment and the consummation of the transactions contemplated hereby do not and will not (a) violate any provision of any law or any governmental rule or regulation applicable to Holdings or any of its Subsidiaries, any of the Organizational Documents of Holdings or any of its Subsidiaries, or any order, judgment or decree of any court or other agency of government binding on Holdings or any of its Subsidiaries; (b) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of Holdings or any of its Subsidiaries; (c) result in or require the creation or imposition of any Lien upon any of the properties or assets of Holdings or any of its Subsidiaries (other than any Liens created under any of the Loan Documents in favor of Lender); or (d) require any approval of stockholders, members or partners or any approval or consent of any Person under any Contractual Obligation of Holdings or any of its Subsidiaries, except for such approvals or consents which will be obtained on or before the date hereof and disclosed in writing to Lender.

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4.           The execution, delivery and performance by each Company of this Amendment and the consummation of the transactions contemplated hereby do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any Governmental Authority.

5.           This Amendment has been duly executed and delivered by each Company and is the legally valid and binding obligation of such Company, enforceable against such Company in accordance with its respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.

6.           After giving effect to this Amendment, the representations and warranties contained in the Credit Agreement and the other Loan Documents are true and correct in all material respects on and as of the date hereof to the same extent as though made on and as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties were true and correct in all material respects on and as of such earlier date, and, other than the Designated Defaults, no Default or Event of Default has occurred and is continuing as of the date hereof.

G.           OTHER AGREEMENTS

1.           Continuing Effectiveness of Loan Documents.  As amended hereby, all terms of the Credit Agreement and the other Loan Documents shall be and remain in full force and effect and shall constitute the legal, valid, binding and enforceable obligations of each Company party thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.  To the extent any terms and conditions in any of the other Loan Documents shall contradict or be in conflict with any terms or conditions of the Credit Agreement, after giving effect to this Amendment, such terms and conditions are hereby deemed modified and amended accordingly to reflect the terms and conditions of the Credit Agreement as modified and amended hereby. Upon the effectiveness of this Amendment such terms and conditions are hereby deemed modified and amended accordingly to reflect the terms and conditions of the Credit Agreement as modified and amended hereby.  The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of Lender under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement.  This Amendment shall constitute a Loan Document for all purposes of the Credit Agreement.

2.           Reaffirmation of Guaranty.  Borrowers and each Guarantor consents to the execution and delivery by Borrowers and each Guarantor of this Amendment and the consummation of the transactions described herein, and ratifies and confirms the terms of the Guaranty to which such Guarantor is a party with respect to the Obligation. Each Guarantor acknowledges that, notwithstanding anything to the contrary contained herein or in any other document evidencing the Obligation or any other obligation or debt of Borrowers to Lender, or any actions now or hereafter taken by Lender with respect to the Obligation, the Guaranty to which any Guarantor is a party (i) is and shall continue to be a primary obligation of such Guarantor, (ii) is and shall continue to be an absolute, unconditional, continuing and irrevocable guaranty of payment, and (iii) is and shall continue to be in full force and effect in accordance with its terms.  Nothing contained herein to the contrary shall release, discharge, modify, change or affect the original liability of each Guarantor under the Guaranty to which such Guarantor is a party.

3.           Acknowledgment of Perfection of Security Interest. Each Company hereby acknowledges that, as of the date hereof, the security interests and Liens granted to Lender under the Credit Agreement and the other Loan Documents, including, without limitations, Liens granted under the Deeds of Trust, are in full force and effect, are properly perfected and are enforceable in accordance with the terms of the Credit Agreement and the other Loan Documents.

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4.           APPLICABLE LAW.   THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

5.           No Novation.  This Amendment is not intended by the parties to be, and shall not be construed to be, a novation of the Credit Agreement and the other Loan Documents or an accord and satisfaction in regard thereto.

6.           Costs and Expenses.  Borrowers agree to pay on demand all costs and expenses of Lender in connection with the preparation, execution and delivery of this Amendment, including, without limitation, the reasonable fees and out-of-pocket expenses of outside counsel for Lender with respect thereto.

7.           Counterparts.  This Amendment may be executed by one or more of the parties hereto in any number of separate counterparts, each of which shall be deemed an original and all of which, taken together, shall be deemed to constitute one and the same instrument.  Delivery of an executed counterpart of this Amendment by facsimile transmission or electronic transmission shall be as effective as delivery of a manually executed counterpart hereof.

8.           Binding Nature.  This Amendment shall be binding upon and inure to the benefit of the parties hereto, their respective successors, successors-in-titles, and assigns.  No third party beneficiaries are intended in connection with this Amendment.

9.           Entire Understanding.  This Amendment sets forth the entire understanding of the parties with respect to the matters set forth herein, and shall supersede any prior negotia­tions or agreements, whether written or oral, with respect thereto.

[Signatures are on the following pages.]

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the date first written above.

BORROWERS:

VERTEX ENERGY OPERATING, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX ENERGY, INC.

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

GUARANTORS:

VERTEX ACQUISITION SUB, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX MERGER SUB, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX REFINING NV, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

  Signature Page to First Amendment to Amended and Restated Credit Agreement

(Vertex Energy, Inc. and Vertex Energy Operating, LLC)

VERTEX REFINING LA, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

CEDAR MARINE TERMINALS, LP

CROSSROAD CARRIERS, L.P.

VERTEX RECOVERY, L.P.

H & H OIL, LP.

By:            Vertex II GP, LLC,

    as sole general partner of each of the foregoing

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

VERTEX II GP, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

GOLDEN STATE LUBRICANTS WORKS, LLC

By:   /s/ Benjamin P. Cowart                        

Benjamin P. Cowart

President & Chief Executive Officer

  Signature Page to First Amendment to Amended and Restated Credit Agreement

(Vertex Energy, Inc. and Vertex Energy Operating, LLC) 

LENDER:

BANK OF AMERICA, N.A.

By:  /s/ Rebecca L. Hetzer                        

Rebecca L. Hetzer

Senior Vice President

  Signature Page to First Amendment to Amended and Restated Credit Agreement

(Vertex Energy, Inc. and Vertex Energy Operating, LLC) 

Schedule A

I.             Events of Defaults

a) an Event of Default has occurred under Section 11.2 of the Credit Agreement as a result of Borrowers’ failure to comply with the Fixed Charge Coverage Ratio set forth in Section 10.1 of the Credit Agreement for the period ending September 30, 2014;

b) an Event of Default has occurred under Section 11.2 of the Credit Agreement as a result of Borrowers’ failure to comply with the minimum Consolidated Adjusted EBITDA set forth in Section 10.3 of the Credit Agreement for the nine month period ending September 30, 2014;

c) an Event of Default has occurred under Section 11.2 of the Credit Agreement as a result of Borrowers’ failure to satisfy the requirements of Items 2, 3, 4, and 6 of the Post-Closing Letter Agreement, dated May 2, 2014, among Borrowers and Lender; and

d) multiple Events of Default have occurred under Section 11.13 of the Credit Agreement as a result of the occurrence of multiple events of default under the GS Term Loan Agreement, including, but not limited to, those certain events of default listed on Schedule A attached to that certain First Amendment to Credit and Guaranty Agreement dated December 5, 2014 by and among Vertex-Operating, Holdings, the guarantors party thereto, Term Loan Agent, and the lenders party thereto.

Schedule A to First Amendment to Amended and Restated Credit Agreement

EX-99.1

Exhibit 99.1

	Investor Relations Contact Marlon Nurse, DM Senior VP - Investor Relations 212-564-4700
Vertex Energy, Inc

VERTEX ENERGY COMPLETES ACQUISTION OF HEARTLAND GROUP HOLDINGS

$16.5 MILLION ALL STOCK PURCHASE PRICE INCLUDES $8 MILLION CONTINGENT EARNOUT

VERTEX CEO BENJAMIN P. COWART BUYS $1.5 MILLION IN STOCK AT PREMIUM TO MARKET

Houston, TX - December  9, 2014, Vertex Energy, Inc. (NASDAQ:VTNR), an environmental services company that recycles industrial waste streams and off-specification commercial chemical products, today announced that it has completed the acquisition of all the assets of Heartland Group Holdings, LLC (“Heartland”), a used-oil collection and re-refining company with its primary operations in Columbus, Ohio. The $16.5 million price includes $8 million in contingent earn-out payments that Heartland may receive if certain EBITDA targets are met in the second year following the closing of the acquisition. The consideration payable by Vertex in the acquisition consisted entirely of common stock.

Additionally, Benjamin P. Cowart, the Chairman and CEO of the company purchased $1.5 million of securities directly from the company, representing an aggregate of 488,598 shares of common stock and warrants to purchase 219,868 shares of common stock with a five year term and a $3.01 exercise price (representing 45% warrant coverage on the shares purchased), for $3.07 per share (and associated warrant rights), a premium over the $3.00 per share closing price of the company’s common stock on December 4, 2014.

Mr. Cowart, stated, “I believe that the Heartland acquisition helps position Vertex for greater growth in 2015 and beyond. As we have stated previously, we believe in a regional strategy which puts the right technology and the right market together. Heartland has been in the used-oil collection business for over fifty years, and the acquisition gives us a platform for expansion. Because of the transaction, Vertex is now more flexible in its response to market challenges. Further, it enhances our national footprint and allows us to offer a diverse range of finished products. The acquisition includes a 16 million gallon refinery and a well-established 6.8 million gallon collection operation in a four-state region. With this acquisition we believe we can process 135 million gallons annually. Additionally, I have further demonstrated my confidence in the company and its prospects by purchasing $1.5 million of Vertex stock at a premium to the market’s close on December 4, 2014.”

In July 2014, Vertex and Heartland signed a letter of intent regarding this transaction, and at the same time, they entered into a consulting agreement. That agreement included Vertex providing advice and guidance related to Heartland’s petroleum collection operations, Heartland’s re-refinery, the installation of new equipment, as well as the implementation of operational changes at the re-refinery prior to the closing of the acquisition. The purpose was to ensure a smooth transition once the acquisition closed, and both parties believe the agreement has met its objective.

About The Assets Acquired From Heartland

The Heartland assets acquired in the acquisition include used oil collection and re-refining operations primary located in Columbus, Ohio including 21 trucks and five service locations covering used oil collections and related services in OH, KY, WV and PA. Also acquired was a state of the art used oil re-refinery located in Columbus, Ohio which processes approximately 16 million gallons annually of used oil into Group II Base oil.

ABOUT VERTEX ENERGY, INC.

Vertex Energy, Inc. (NASDAQ: VTNR) is a leading environmental services company that recycles industrial waste streams and off-specification commercial chemical products. Its primary focus is recycling used motor oil and other petroleum by-product streams. Vertex purchases these streams from an established network of local and regional collectors and generators. Vertex also manages the transport, storage and delivery of the aggregated feedstock and product streams to end users, and manages the re-refining of a portion of its aggregated petroleum streams in order to sell them as higher-value end products, including low sulfur cutter, vacuum gas oil (VGO), and  base oil. Vertex sells its aggregated petroleum streams as feedstock to other re-refineries and fuel blenders or as replacement fuel for use in industrial burners. The re-refining of used motor oil that Vertex manages takes place at its facility, which uses a proprietary Thermal Chemical Extraction Process (“TCEP”) technology. Vertex collects oil through its H&H Oil in the Texas region and Heartland Petroleum in a four-state region. Based in Houston, Texas, Vertex also has offices in California, Chicago, Columbus, and Georgia. More information on Vertex can be found at www.vertexenergy.com.

This press release may contain forward-looking statements, including information about management's view of Vertex Energy's future expectations, plans and prospects, and Vertex’s ability to integrate any acquired businesses, assets, employees and operations into its operations, within the safe harbor provisions under The Private Securities Litigation Reform Act of 1995 (the "Act"). In particular, when used in the preceding discussion, the words "believes," "expects," "intends," "plans," "anticipates," or "may," and similar conditional expressions are intended to identify forward-looking statements within the meaning of the Act, and are subject to the safe harbor created by the Act. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, which may cause the results of Vertex Energy, its divisions and concepts to be materially different than those expressed or implied in such statements. These risk factors and others are included from time to time in documents Vertex Energy files with the Securities and Exchange Commission, including but not limited to, its Form 10-Ks, Form 10-Qs and Form 8-Ks. Other unknown or unpredictable factors also could have material adverse effects on Vertex Energy's future results. The forward-looking statements included in this press release are made only as of the date hereof. Vertex Energy cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, Vertex Energy undertakes no obligation to update these statements after the date of this release, except as required by law, and also takes no obligation to update or correct information prepared by third parties that are not paid for by Vertex Energy.

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