Specialty refiner Vertex Energy, Inc. commenced Chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas. The company has entered into a Restructuring Support Agreement with lenders to commence expedited voluntary Chapter 11 proceeding.

Vertex said in a statement it has entered into a Restructuring Support Agreement (RSA) “with overwhelming support of 100% of the Company’s term loan lenders.”

To facilitate the transactions contemplated under the RSA, including exploration of a sale transaction, the company commenced Chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas.

Vertex said it has filed customary first day motions and plans to operate its business in the ordinary course as it explores a holistic restructuring strategy pursuant to the terms of the RSA.

To fund this process and continue operating in the ordinary course, the consenting term loan lenders have agreed to provide the company with an additional $80 million Debtor-In-Possession financing facility subject to certain terms and the satisfaction of certain conditions precedent.

The company has also filed a Chapter 11 plan and bidding procedures, and anticipates confirming the Chapter 11 plan by the end of the year, according to the statement.

Benjamin P. Cowart, president and CEO of Vertex, stated, “As we enter this next phase of our restructuring process through a formal proceeding, we are appreciative of the continued support from our lenders.

“Their confidence in our business, as demonstrated by this ongoing collaboration, reinforces the critical role Vertex plays in the specialty refinery space.

“We want to thank our employees for continuing to be fully engaged as we go through this process and prioritizing safety and customer satisfaction above all else. Together with our lenders, we feel confident this decision provides the best pathway toward future success.”

Seth Bullock of Alvarez & Marsal, chief restructuring officer, added: “We have gained significant momentum with the partnership of Vertex’s lenders over the last several months and believe the restructuring support agreement and related milestones will allow the Company to initiate a fresh start and improve long-term value as it singularly concentrates on strengthening its foundation for continued growth and stability.”

Source: Vertex Energy, Inc. To read the full press release pls see here.