Blue Dolphin Energy Company (OTCMKTS:BDCO) Files An 8-K Entry into a Material Definitive Agreement

Blue Dolphin Energy Company (OTCMKTS:BDCO) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.

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As previously disclosed, on September 26, 2017, Blue Dolphin Energy Company (“Blue Dolphin”), its wholly owned subsidiary Lazarus Energy, LLC (“LE”) and their affiliates Lazarus Energy Holdings, LLC and Jonathan Carroll (collectively, the “Lazarus Parties”) entered into a Letter Agreement with GEL Tex Marketing, LLC (“GEL”), effective September 18, 2017 (the “Letter Agreement”). Among other matters, the Letter Agreement confirmed the parties’ agreement to the continuation of the hearing on confirmation of the final award in the arbitration proceedings between LE and GEL for a period of time (the “Continuance Period”), subject to the terms of the Letter Agreement, in order to facilitate settlement discussions between the parties.

to an eighth amendment to the Letter Agreement dated May 23, 2018 (the “Amendment”), the Lazarus Parties and GEL extended the Continuance Period through June 29, 2018, in order to facilitate ongoing discussions. The Amendment was fully executed by all parties on May 30, 2018. An additional $500,000.00 was paid to GEL on May 29, 2018, which amount has been applied to reduce the balance of the final award.

Under the Amendment, the Lazarus Parties, including Blue Dolphin, remain prohibited from making any pre-payments on indebtedness through the end of the extended Continuance Period other than in the ordinary course of business as described in the Letter Agreement. Additionally, the Lazarus Parties will continue to suspend, during the Continuance Period, payments to Jonathan Carroll to certain previously disclosed guaranty fee agreements between Mr. Carroll and certain subsidiaries of Blue Dolphin. As previously disclosed, the terms of the guaranty fee agreements were amended in April 2017 to reflect payments 50% in cash and 50% in Blue Dolphin common stock, and subsequently, Mr. Carroll agreed to accept the initial payment under the amended and restated guaranty fee agreements, which occurred in May 2017, 50% in Blue Dolphin common stock. Jonathan Carroll has received no cash payments since August 2016 and no common stock payments since May 2017 under the amended and restated guaranty fee agreements.

Blue Dolphin continues to be unable to provide any assurance as to whether negotiations with GEL will result in a settlement or as to the potential terms of any such settlement.


About Blue Dolphin Energy Company (OTCMKTS:BDCO)

Blue Dolphin Energy Company (Blue Dolphin) is an independent refiner and marketer of petroleum products. The Company’s primary asset is an approximately 15,000 barrels per day (bpd) crude oil and condensate processing facility that is located in Nixon, Texas (the Nixon Facility). The Nixon Facility is situated on approximately 60 acres in Nixon, Wilson County, Texas. The Company operates through two segments: Refinery Operations and Pipeline Transportation. Business activities related to its refinery operations business segment are conducted at the Nixon Facility. Business activities related to its pipeline transportation business segment are primarily conducted in the Gulf of Mexico through the Company’s pipeline assets and leasehold interests in oil and gas properties. As part of its refinery business segment, it conducts petroleum storage and terminaling operations under third-party lease agreements at the Nixon Facility.

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