EXHIBIT 10.1
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 18, 2022
Blue Dolphin Energy Company |
(Exact name of registrant as specified in its charter) |
Delaware |
| 0-15905 |
| 73-1268729 |
(State or Other Jurisdiction of Incorporation) |
| (Commission File Number) |
| (IRS Employer Identification No.) |
801 Travis Street, Suite 2100
Houston, TX 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) |
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☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
| Trading Symbol (s) |
| Name of each exchange on which registered |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).
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.
Effective November 18, 2022, Lazarus Energy LLC (“Lazarus Energy”), Lazarus Refining & Marketing LLC (“Lazarus Refining” and, together with Lazarus Energy, the “Borrowers”), Blue Dolphin Energy Company (the “Company”), Lazarus Energy Holdings LLC (“Lazarus Holdings”), and Jonathan Carroll (“Carroll” and , together with Borrowers, the Company and Lazarus Holdings, the “Lazarus Parties”), entered into a Forbearance Agreement (the “Forbearance Agreement”) with Veritex Community Bank (“Veritex”), relating to amounts owed by the Lazarus Parties to Veritex under the June 22, 2015 and December 4, 2015 loan agreements (the “Loan Agreements”).
Under the Forbearance Agreement, the Borrowers will pay on or before November 28, 2022, approximately $5.4 million to Veritex, which represents all past due principal and interest (excluding late fees) owed under the Loan Agreements and a $1,000,000 payment reserve account deposit. Veritex agreed to forebear from exercising any of its rights and remedies relative to existing past defaults of the Lazarus Parties under the Loan Agreements from the effective date of the Forbearance Agreement through September 30, 2023, and Veritex will also forbear from testing compliance with financial covenants during the term of the Forbearance Agreement. The Borrowers shall make monthly payments on the debt through September 30, 2023. In the event that the Borrowers pay off all amounts due under the Loan Agreements on or before September 30, 2023, Veritex also agreed to waive late fees totaling approximately $400,000 in the aggregate.
Carroll serves as Chief Executive Officer and President of the Company. He also serves as President and is a majority owner of Lazarus Holdings. Together, Carroll and Lazarus Holdings owned approximately 83% of the Company’s common stock as of the filing date of this report.
The foregoing description of the Forbearance Agreement constitutes only a summary thereof and is qualified in its entirety by reference to the text thereof filed as Exhibit 10.1 hereof.
Item 8.01 Other Events.
On November 23, 2022, the Company issued a press release announcing the entry of the Lazarus Parties into the Forbearance Agreement, a copy of which is filed herewith as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Blue Dolphin Energy Company Press Release Issued November 23, 2022. |
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SIGNATURE
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.
Date: November 23,2022
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| Blue Dolphin Energy Company |
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| /s/ JONATHAN P. CARROLL |
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| Jonathan P. Carroll Chief Executive Officer, President, Assistant Treasurer and Secretary (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer) |
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EXHIBIT 10.1
EXHIBIT 99.1
PRESS RELEASE
FOR IMMEDIATE RELEASE
November 23, 2022
Blue Dolphin ANNOUNCES VERITEX FORBEARANCE AGREEMENT
Houston, November 23, 2022 / Issuer Direct / -- Blue Dolphin Energy Company (“Blue Dolphin”)(OTCQX:BDCO), an independent refiner and marketer of petroleum products in the Eagle Ford Shale region, announced that wholly owned subsidiaries Lazarus Energy LLC (“Lazarus Energy”), Lazarus Refining & Marketing LLC (“Lazarus Refining” and, together with Lazarus Energy, the “Borrowers”), Blue Dolphin, Lazarus Energy Holdings LLC (“Lazarus Holdings”), and Jonathan Carroll (“Carroll” and , together with Borrowers, Blue Dolphin, and Lazarus Holdings, the “Lazarus Parties”), entered into a forbearance agreement with Veritex Community Bank (“Veritex”), relating to amounts owed by the Lazarus Parties to Veritex under June 22, 2015 and December 4, 2015 loan agreements.
As part of the forbearance agreement, Borrowers will pay a total of $5,424,369 to Veritex, which represents all past due principal and interest (excluding late fees) owed under the loan agreements and a $1,000,000 deposit to replenish Lazarus Energy’s payment reserve account under the June 22, 2015 loan agreement. As of the effective date of the forbearance agreement through September 30, 2023, Veritex agreed to forebear from exercising any of its rights and remedies relative to existing past defaults under the loan agreements. If the Borrowers pay all past due principal and interest amounts under the Veritex loan agreements on or before September 30, 2023, Veritex also agreed to waive accrued late fees totaling approximately $0.4 million in the aggregate.
“We continue to make strides towards improving our financial profile,” said Jonathan P. Carroll, Chief Executive Officer and President of Blue Dolphin Energy Company. He added, “Even though the two loans with Veritex do not mature until 2034, we are in active conversations to secure new long term debt facilities that would refinance the majority of our senior secured debt and provide additional capital for new projects, improvements, and working capital.”
About Blue Dolphin
Blue Dolphin is an independent downstream energy company operating in the Gulf Coast region of the United States. Subsidiaries operate a light sweet-crude, 15,000-bpd crude distillation tower with more than 1.2 million bbls of petroleum storage tank capacity in Nixon, Texas. Blue Dolphin was formed in 1986 as a Delaware corporation. The company trades on the OTCQX under the ticker symbol “BDCO.” For additional information, visit Blue Dolphin’s corporate website at http://www.blue-dolphin-energy.com.
Contact:
Jonathan P. Carroll
Chief Executive Officer and President
713-568-4725
Cautionary Statements Relevant to Forward-Looking Information for the Purpose of “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995. This press release contains forward-looking statements relating to Blue Dolphin’s operations that are based on management’s current expectations, estimates and projections about the oil and gas industry. Words or phrases such as “anticipates,” “expects,” “intends,” “plans,” “targets,” “advances,” “commits,” “drives,” “aims,” “forecasts,” “projects,” “believes,” “approaches,” “seeks,” “schedules,” “estimates,” “positions,” “pursues,” “may,” “can,” “could,” “should,” “will,” “budgets,” “outlook,” “trends,” “guidance,” “focus,” “on track,” “goals,” “objectives,” “strategies,” “opportunities,” “poised,” “potential,” “ambitions,” “aspires” and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties, and other factors, many of which are beyond the company’s control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Unless legally required, Blue Dolphin undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
For a discussion of risk factors that could cause actual results to differ materially from those in the forward-looking statements, please see the factors set forth under the heading “Risk Factors” in Blue Dolphin’s 2021 Annual Report on Form 10-K and in subsequent filings with the U.S. Securities and Exchange Commission. Other unpredictable or unknown factors not discussed in this press release could also have material adverse effects on forward-looking statements.
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