UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported):
November 15,
2018
Blue Dolphin Energy Company
(Exact name of registrant as specified in its charter)
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Delaware
(State or Other Jurisdiction of Incorporation)
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0-15905
(Commission File Number)
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73-1268729
(IRS Employer Identification
No.)
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801 Travis Street, Suite 2100
Houston, Texas 77002
(Address of principal executive office and zip code)
(713) 568-4725
(Registrant’s telephone number, including area
code)
(Not Applicable)
(Former name or former address, if changed since last
report)
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 (see General Instruction A.2
below):
[ ]
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))
Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter).
Emerging
growth company ☐
If an
emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
Item
1.01.
Entry
into a Material Definitive Agreement.
As
previously disclosed, on July 20, 2018, Blue Dolphin Energy Company
(“Blue Dolphin”), its wholly-owned subsidiaries Lazarus
Energy, LLC (“LE”) and Nixon Products Storage, LLC, and
their affiliates Lazarus Energy Holdings, LLC, Jonathan Carroll and
Carroll & Company Financial Holdings, L.P. (collectively, the
“Lazarus Parties”) entered into a Settlement Agreement
with GEL Tex Marketing, LLC (“GEL”), an affiliate of
Genesis Energy, LP, (as amended by the First Amendment thereto
dated as of October 17, 2018, the “Settlement
Agreement”) related to the previously disclosed arbitration
proceedings involving Blue Dolphin, LE and GEL.
Under
the Settlement Agreement, GEL and the Lazarus Parties agreed to
mutually release all claims against each other and to file a
stipulation of dismissal with prejudice in connection with the
arbitration proceedings, subject to the terms and conditions set
forth in the Settlement Agreement (the “Settlement”),
including payment by the Lazarus Parties to GEL of $10,000,000 in
cash (the “Settlement Payment”). The Settlement
Agreement provides that the Settlement Agreement will terminate,
unless extended in writing by GEL, on December 31, 2018 if the
Settlement Payment is not made on or before such date (the
“Settlement Payment Deadline”) and may be terminated by
GEL following the occurrence of an event of default under the
Settlement Agreement. The Settlement Agreement also requires the
Lazarus Parties to work in good faith and take reasonable actions
to obtain a commercial loan in an aggregate principal amount equal
to the Settlement Payment (the “Settlement Financing”)
and provides that an event of default will occur if the Lazarus
Parties fail to achieve certain milestones related to the
Settlement Financing.
On
November 15, 2018, the Lazarus Parties and GEL entered into a
Second Amendment to the Settlement Agreement (the “Second
Amendment”). The Second Amendment (i) extended the Settlement
Payment Deadline from December 31, 2018 to January 31, 2019 (unless
extended in writing by GEL) and (ii) extended the dates for
achievement of certain milestones related to the Settlement
Financing.
Blue
Dolphin can provide no assurance that the conditions to the
consummation of the Settlement will be met. If any of the
conditions are not met or the Settlement Agreement is terminated,
GEL may seek to enforce the final award in the arbitration
proceedings against the Lazarus Parties, in which case, Blue
Dolphin and its affiliates would likely be required to seek
protection under bankruptcy laws.
The
foregoing description of the terms of the Second Amendment does not
purport to be complete and is qualified in its entirety by
reference to the Second Amendment, which has been filed as Exhibit
10.1 to this Current Report on Form 8-K.
Item 5.02.
Departure
of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
On
November 23, 2018, Mr. Tommy L. Byrd notified
Blue Dolphin that he intends to resign as Chief Financial Officer
of Blue Dolphin, effective December 31, 2018. Blue Dolphin will
conduct a search for a Chief Financial Officer and name a successor
or interim Chief Financial Officer prior to Mr. Byrd’s
departure.
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Item 9.01.
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Financial
Statements and Exhibits.
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(d)
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Exhibits
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Second
Amendment to the Settlement Agreement, dated as of November 15,
2018, by and among
Lazarus
Energy, LLC, Blue Dolphin Energy Company, Lazarus Energy Holdings,
LLC, Nixon
Product
Storage, LLC, Carroll & Company Financial Holdings, L.P.,
Jonathan Carroll and GEL
Tex
Marketing, LLC.
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly
authorized.
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Blue Dolphin Energy Company
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Date: November 23, 2018
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By:
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/s/
JONATHAN
P. CARROLL
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Jonathan P. Carroll
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Chief Executive Officer, President,
Assistant Treasurer and Secretary
(Principal Executive Officer)
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Exhibit 10.1
SECOND AMENDMENT TO THE SETTLEMENT AGREEMENT
This
Second Amendment to the Settlement Agreement (this
“
Second
Amendment
”), dated as of November 15, 2018, is by and
between Lazarus Energy, LLC, a Delaware limited liability company
(“
Lazarus
”); Blue Dolphin
Energy Company, a Delaware corporation (“
BDEC
”); Lazarus Energy
Holdings, LLC, a Delaware limited liability company
(“
LEH
”); Nixon Product
Storage, LLC, a Delaware limited liability company
(“
Nixon
”); Carroll &
Company Financial Holdings, L.P. (“
C&C
”); Jonathan
Carroll (“
Carroll
” and, together
with Lazarus, BDEC, LEH, Nixon, and C&C the “
Lazarus Parties
”); and
GEL Tex Marketing, LLC, a Delaware limited liability company
(“
GEL
Tex
”) (each, a “
Party
” and, collectively,
the “
Parties
”).
RECITALS
WHEREAS, on July
20, 2018, the Parties executed the Settlement Agreement
1
in order to provide for a settlement
between the Lazarus Parties and GEL Tex regarding the Final Award
that resolves the Arbitration and the District Court Action
contingent upon the Lazarus Parties obtaining the Settlement
Financing to fund a settlement in accordance with the terms of the
Settlement Agreement;
WHEREAS, paragraph
15(d) of the Settlement Agreement requires the Lazarus Parties to
achieve certain milestones in connection with obtaining the
Settlement Financing;
WHEREAS, paragraph
17(a) of the Settlement Agreement provides that the Settlement
Agreement shall terminate automatically on December 31, 2018 unless
otherwise extended in writing by GEL Tex;
WHEREAS, on October
17, 2018, the Parties executed the First Amendment to the
Settlement Agreement (the “
First Amendment
”) to
amend the Settlement Agreement;
WHEREAS, in order
to facilitate the Lazarus Parties’ ongoing negotiations to
obtain the Settlement Financing, GEL Tex and the Lazarus Parties
hereby agree to further amend the Settlement
Agreement;
NOW,
THEREFORE, in consideration of the foregoing and the mutual
covenant and agreements set forth in the Settlement Agreement and
this Second Amendment, and for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
Parties, intending to be legally bound, agree as
follows:
AGREEMENT
1. Paragraph
15(d)(i) of the Settlement Agreement shall be further amended and
replaced in its entirety and shall now state:
Provide
GEL Tex with a copy of the United States Department of
Agriculture’s or a bona fide third-party lender’s
Commitment of the Settlement Financing by no later than December
15, 2018, unless otherwise extended in writing by GEL
Tex;
2. Paragraph
15(d)(ii) of the Settlement Agreement shall be amended and replaced
in its entirety and shall now state:
Provide
GEL Tex with copies of the fully executed loan documents for the
Settlement Financing by no later than January 17, 2019, unless
otherwise extended in writing by GEL Tex;
3. Paragraph
17(a) of the Settlement Agreement shall be amended and replaced in
its entirety and shall now state:
January
31, 2019, unless otherwise extended in writing by GEL Tex, if the
Settlement Payment Date has not occurred on or before such date;
or
4. Notwithstanding
anything in this Second Amendment, during the Interim Period, the
Lazarus Parties shall continue to pay GEL Tex the Interim Payments
on the last business day of each calendar month.
5. GEL
Tex and the Lazarus Parties agree that this Second Amendment may be
executed in separate parts delivered by electronic means that,
taken together, will be deemed to be one instrument. GEL Tex and
each Lazarus Party represent and warrant that this Second Amendment
has been approved and authorized by all necessary action and the
execution hereof does not violate any agreement to which it is a
party.
6. Except
as set forth in this Second Amendment, the Settlement Agreement and
the First Amendment are unaffected and shall continue in full force
and effect in accordance with their terms. If there is a conflict
between this Second Amendment, the First Amendment, and the
Settlement Agreement, the terms of this Second Amendment will
prevail.
[Signature Pages Follow]
IN
WITNESS WHEREOF, the undersigned have caused this Second Amendment
to the Settlement Agreement to be duly executed and delivered as of
the date first set forth above.
GEL TEX
MARKETING, LLC
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By:
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/s/
R.V. DEERE
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Name:
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Robert
V. Deere
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Title:
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Chief
Financial Officer
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LAZARUS
ENERGY, LLC
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By:
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/s/
JONATHAN CARROLL
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Name:
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Jonathan
Carroll
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Title:
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President
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BLUE
DOLPHIN ENERGY COMPANY
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By:
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/s/
JONATHAN CARROLL
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Name:
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Jonathan
Carroll
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Title:
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President
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LAZARUS
ENERGY HOLDINGS, LLC
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By:
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/s/
JONATHAN CARROLL
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Name:
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Jonathan
Carroll
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Title:
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President
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NIXON
PRODUCT STORAGE, LLC
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By:
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/s/
JONATHAN CARROLL
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Name:
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Jonathan
Carroll
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Title:
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President
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CARROLL
& COMPANY FINANCIAL HOLDINGS, L.P.
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By:
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/s/
JONATHAN CARROLL
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Name:
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Lazarus
Financial, LLC
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Title:
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General
Partner
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By:
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/s/
JONATHAN CARROLL
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Jonathan
Carroll
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