EX. 10.3
 
SOVEREIGN BANK – LOAN NO.
 
GUARANTY AGREEMENT
 
THIS GUARANTY AGREEMENT (as amended, modified or restated from time to time,
this “Guaranty”) dated as of MAY 2, 2014 (the “Effective Date”), is executed by
JONATHAN P. CARROLL and by INGLESIDE CRUDE LLC, a Delaware limited liability
company (individually and collectively, and jointly and severally, “Guarantor”),
whose address for notice purposes are set forth on the signature page hereto,
for the benefit of SOVEREIGN BANK, a Texas state bank (together with its
successors and assigns, “Lender”) with offices at 17950 Preston Road, Suite 500,
Dallas, TX 75252.
 
RECITALS
 
WHEREAS, Debtor (as defined below) and Lender have entered into that certain
LOAN AND SECURITY AGREEMENT of even date herewith (as amended, modified or
otherwise restated, the “Loan Agreement”) setting forth the terms of a Credit
Facility (as defined in the Loan Agreement) to be provided by Lender to Debtor;
and
 
WHEREAS, it is expressly understood among Debtor, Guarantor, and Lender that the
execution and delivery of this Guaranty is a condition precedent to Lender’s
obligation to extend credit under the Loan Agreement and is an integral part of
the transactions contemplated thereby; and
 
WHEREAS, the extension of credit to Debtor is a substantial and direct benefit
to Guarantor;
 
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of which
are hereby acknowledged, Guarantor hereby guarantees to Lender the prompt
payment and performance of the Guaranteed Obligations, this Guaranty being upon
the following terms and conditions:
 
1. Definitions.  As used in this Guaranty, the following terms have the
following meanings:
 
“Debtor” means LAZARUS REFINING & MARKETING, LLC, a Delaware limited liability
company, and without limitation, Debtor’s successors and assigns (regardless of
whether such successor or assign is formed by or results from any merger,
consolidation, conversion, sale or transfer of assets, reorganization, or
otherwise) including Debtor as a debtor-in-possession, and any receiver,
trustee, liquidator, conservator, custodian, or similar party hereafter
appointed for Debtor or all or substantially all of its assets pursuant to any
liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, or similar Debtor Relief Laws
(hereinafter defined) from time to time in effect.
 
“Debtor Relief Laws” means Title 11 of the United States Code, as now or
hereafter in effect, or any other applicable law, domestic or foreign, as now or
hereafter in effect, relating to bankruptcy, insolvency, liquidation,
receivership, reorganization, arrangement or composition, extension or
adjustment of debts, or similar laws affecting the rights of creditors.
 
“Guaranteed Obligations” means all (a) Indebtedness, including without
limitation all indebtedness and obligations of Debtor to Lender and any and all
pre- and post-maturity interest thereon, including without limitation
post-petition interest and expenses (including reasonable attorneys’ fees)
allowed under Debtor Relief Laws, whether or not allowed under any Debtor Relief
Law, (b) obligations of Debtor to Lender under any documents evidencing,
securing, governing and/or pertaining to all or any part of the indebtedness
described in (a) above, (c) costs and expenses incurred by Lender in connection
with the collection and administration of all or any part of the Indebtedness
and obligations described in (a) and (b) above or the protection or preservation
of, or realization upon, the collateral securing all or any part of such
Indebtedness and obligations, including without limitation all reasonable
attorneys’ fees, and (d) renewals, extensions, modifications and rearrangements
of the indebtedness and obligations described in (a), (b), and (c) above.
 
Terms not otherwise defined herein shall have the same meanings as in the Loan
Agreement.
 
 
GUARANTY AGREEMENT – PAGE 1
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------

 
 
2. Payment.  Guarantor hereby unconditionally and irrevocably guarantees to
Lender the punctual payment when due, whether by lapse of time, by acceleration
of maturity, or otherwise, and at all times thereafter, of the Guaranteed
Obligations.  This Guaranty covers the Guaranteed Obligations, whether presently
outstanding or arising subsequent to the date hereof, including all amounts
advanced by Lender.  The guaranty of Guarantor as set forth in this Section 2 is
a continuing guaranty of payment and not a guaranty of collection. Guarantor
acknowledges and agrees that Guarantor may be required to pay and perform the
Guaranteed Obligations in full without assistance or support from Debtor or any
other party.  Guarantor agrees that if all or any part of the Guaranteed
Obligations shall not be punctually paid when due, whether on the scheduled
payment date, by lapse of time, by acceleration of maturity or otherwise
(following the expiration of all applicable grace and cure periods), Guarantor
shall, immediately upon demand by Lender, pay the amount due on the Guaranteed
Obligations to Lender at Lender’s address as set forth herein.  Such demand(s)
may be made at any time coincident with or after the time for payment of all or
part of the Guaranteed Obligations, and may be made from time to time with
respect to the same or different items of Guaranteed Obligations.  Such demand
shall be made, given and received in accordance with the notice provisions
hereof.
 
3. Primary Liability of Guarantor.  This Guaranty is an absolute, irrevocable
and unconditional guaranty of payment and performance. Guarantor is jointly and
severally liable for the payment and performance of the Guaranteed Obligations,
as set forth in and as limited by this Guaranty, as a primary obligor.  In the
event of default in payment or performance of the Guaranteed Obligations, or any
part thereof, when such Guaranteed Obligations become due, whether by its terms,
by acceleration, or otherwise, Guarantor shall promptly pay the amount due
thereon to Lender without notice or demand, of any kind or nature, in lawful
money of the United States of America or perform the obligations to be performed
hereunder, and it shall not be necessary for Lender in order to enforce such
payment and performance by Guarantor first, or contemporaneously, to institute
suit or exhaust remedies against Debtor or others liable on the Guaranteed
Obligations, or to enforce any rights, remedies, powers, privileges or benefits
of Lender against any collateral, or any other security or collateral which
shall ever have been given to secure the Guaranteed Obligations.  Suit may be
brought or demand may be made against all parties who have signed this Guaranty
or any other guaranty in favor of Lender covering all or any part of the
Guaranteed Obligations, or against any one or more of them, separately or
together, without impairing the rights of Lender against any party hereto.  Any
time that Lender is entitled to exercise its rights or remedies hereunder,
Lender may in its discretion elect to demand payment and/or performance.  If
Lender elects to demand performance, it shall at all times thereafter have the
right to demand payment until all of the Guaranteed Obligations have been paid
and performed in full.  If Lender elects to demand payment, it shall at all
times thereafter have the right to demand performance until all of the
Guaranteed Obligations have been paid and performed in full.
 
4. Other Guaranteed Debt.  If Guarantor becomes liable for any indebtedness
owing by Debtor to Lender, by endorsement or otherwise, other than under this
Guaranty, such liability shall not be in any manner impaired or affected hereby,
and the rights and remedies hereunder shall be cumulative of any and all other
rights and remedies that Lender may ever have against Guarantor.  The exercise
by Lender of any right or remedy hereunder or under any other instrument, or at
law or in equity, shall not preclude the concurrent or subsequent exercise of
any other right or remedy by Lender.
 
5. Subrogation.  Until the Guaranteed Obligations have been paid, in full,
Guarantor hereby covenants and agrees that:  (a) it shall not assert, enforce,
or otherwise exercise any right of subrogation to any of the rights, remedies or
liens of Lender or any other beneficiary against Debtor or any other guarantor
of the Guaranteed Obligations or any collateral or other security; and (b) any
right of recourse, reimbursement, contribution, indemnification, or similar
right against Debtor or any other guarantor of all or any part of the Guaranteed
Obligations are expressly made subordinate to the Guaranteed Obligations and the
rights or remedies of Lender under this Guaranty and the Loan Documents.
 
6. Subordinated Debt.  All principal of and interest on all indebtedness,
liabilities, and obligations of Debtor to Guarantor (the “Subordinated Debt”)
now or hereafter existing, due or to become due to Guarantor, or held or to be
held by Guarantor, whether created directly or acquired by assignment or
otherwise, and whether evidenced by written instrument or not, shall be
expressly subordinated to the Guaranteed Obligations.  Until such time as the
Guaranteed Obligations are paid and performed in full and all commitments to
lend under the Loan Documents have terminated, Guarantor agrees not to receive
or accept any payment from Debtor with respect to the Subordinated Debt at any
time an Event of Default has occurred and is continuing; and, in the event
Guarantor receives any payment on the Subordinated Debt in violation of the
foregoing, Guarantor will hold any such payment in trust for Lender and
forthwith turn it over to Lender in the form received, to be applied to the
Guaranteed Obligations.
 
 
GUARANTY AGREEMENT – PAGE 2
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------

 
 
7. Obligations Not To Be Diminished.  Guarantor hereby agrees that its
obligations under this Guaranty shall not be released, discharged, diminished,
impaired, reduced, or affected for any reason or by the occurrence of any event,
including, without limitation, one or more of the following events, whether or
not with notice to or the consent of Guarantor:  (a) the taking or accepting of
collateral as security for any or all of the Guaranteed Obligations or the
release, surrender, exchange, or subordination of any collateral now or
hereafter securing any or all of the Guaranteed Obligations; (b) any partial
release of the liability of Debtor, Guarantor hereunder, or the full or partial
release of any other guarantor or obligor from liability for any or all of the
Guaranteed Obligations; (c) any disability of Debtor, or the dissolution,
insolvency, or bankruptcy of Debtor, or any other guarantor, or any other party
at any time liable for the payment of any or all of the Guaranteed Obligations;
(d) any renewal, extension, modification, waiver, amendment, or rearrangement of
any or all of the Guaranteed Obligations or any instrument, document, or
agreement evidencing, securing, or otherwise relating to any or all of the
Guaranteed Obligations; (e) any adjustment, indulgence, forbearance, waiver, or
compromise that may be granted or given by Lender to Debtor, Guarantor, or any
other party ever liable for any or all of the Guaranteed Obligations; (f) any
neglect, delay, omission, failure, or refusal of Lender to take or prosecute any
action for the collection of any of the Guaranteed Obligations or to foreclose
or take or prosecute any action in connection with any instrument, document, or
agreement evidencing, securing, or otherwise relating to any or all of the
Guaranteed Obligations; (g) the unenforceability or invalidity of any or all of
the Guaranteed Obligations or of any instrument, document, or agreement
evidencing, securing, or otherwise relating to any or all of the Guaranteed
Obligations; (h) any payment by Debtor or any other party to Lender is held to
constitute a preference under applicable bankruptcy or insolvency law or if for
any other reason Lender is required to refund any payment or pay the amount
thereof to someone else; (i) the settlement or compromise of any of the
Guaranteed Obligations; (j) the non-perfection of any security interest or lien
securing any or all of the Guaranteed Obligations; (k) any impairment of any
collateral securing any or all of the Guaranteed Obligations; (l) the failure of
Lender to sell any collateral securing any or all of the Guaranteed Obligations
in a commercially reasonable manner or as otherwise required by law; (m) any
change in the corporate existence, structure, or ownership of Debtor; or (n) any
other circumstance which might otherwise constitute a defense available to, or
discharge of, Debtor or Guarantor other than payment.
 
8. Waivers.  Guarantor waives (a) any right to revoke this Guaranty with respect
to future Guaranteed Obligations; (b) any right to require Lender to do any of
the following before Guarantor is obligated to pay the Guaranteed Obligations or
before Lender may proceed against Guarantor: (i) sue or exhaust remedies against
Debtor and other guarantors or obligors, (ii) sue on an accrued right of action
in respect of any of the Guaranteed Obligations or bring any other action,
exercise any other right, or exhaust all other remedies, or (iii) enforce rights
against Debtor’s assets or the collateral pledged by Debtor to secure the
Guaranteed Obligations; (c) any right relating to the timing, manner, or conduct
of Lender’s enforcement of rights against Debtor’s assets or the collateral
pledged by Debtor to secure the Guaranteed Obligations; (d) if Guarantor and
Debtor (or a third-party) have each pledged assets to secure the Guaranteed
Obligations, any right to require Lender to proceed first against the other
collateral before proceeding against collateral pledged by Guarantor; (e) except
as expressly required hereby, promptness, diligence, notice of any default under
the Guaranteed Obligations, notice of acceleration or intent to accelerate,
demand for payment, notice of acceptance of this Guaranty, presentment, notice
of protest, notice of dishonor, notice of the incurring by Debtor of additional
indebtedness, notice of any suit or other action by Lender against Debtor or any
other Person, any notice to any party liable for the obligation which is the
subject of the suit or action, and all other notices and demands with respect to
the Guaranteed Obligations and this Guaranty; (f) each of the foregoing rights
or defenses regardless whether they arise under (i) Chapter 43 or Section 17.001
of the Texas Civil Practice and Remedies Code, as amended, (ii) Rule 31 of the
Texas Rules of Civil Procedure, as amended, or (iii) common law, in equity,
under contract, by statute, or otherwise; and (g) any and all rights under
Sections 51.003, 51.004 and 51.005 of the Texas Property Code, as amended.
 
9. Change in Guarantor’s Status.  Should Guarantor die, become legally
incapacitated, become insolvent, or fail to pay such Guarantor’s debts generally
as they become due, or voluntarily seek, consent to, or acquiesce in the benefit
or benefits of any Debtor Relief Law or become a party to (or be made the
subject of) any proceeding provided for by any Debtor Relief Law (other than as
a creditor or claimant) that could suspend or otherwise adversely affect the
rights of Lender granted hereunder, then, in any such event, the Guaranteed
Obligations shall be, as between Guarantor and Lender, a fully matured, due,
payable and performable obligation of Guarantor to Lender (without regard to
whether Debtor is then in default under the Loan Documents or whether the
Guaranteed Obligations, or any part thereof is then due and owing or unperformed
by Debtor to Lender), payable and/or performable in full by Guarantor to Lender
upon demand, which shall be the estimated amount owing in respect of the
contingent claim created hereunder; provided, however, the death or legal
incapacity of Guarantor shall not cause the maturity of the Guaranteed
Obligations if, within THIRTY (30) days of the date of such death or incapacity,
the representative or legal guardian of Guarantor or Guarantor’s estate affirms
in writing (which instrument shall be in form and substance satisfactory to
Lender) (a) the obligations of Guarantor’s estate with respect to this Guaranty
and (b) that no distributions shall be made from such estate without the prior
written consent of Lender.
 
 
GUARANTY AGREEMENT – PAGE 3
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------

 
 
10. Termination.  Guarantor’s obligations hereunder shall remain in full force
and effect until all commitments to lend under the Loan Documents have
terminated, and the Guaranteed Obligations have been paid in full.  If at any
time any payment of the principal of or interest or any other amount payable by
Debtor under the Loan Documents is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy, or reorganization of Debtor or
otherwise, Guarantor’s obligations hereunder with respect to such payment shall
be reinstated as though such payment had been due but not made at such time.
 
11. Representations and Warranties.  Guarantor represents and warrants as
follows:
 
(a) Guarantor has the power and authority and legal right to execute, deliver,
and perform its obligations under this Guaranty and this Guaranty constitutes
the legal, valid, and binding obligation of Guarantor, enforceable against
Guarantor in accordance with its terms, except as limited by bankruptcy,
insolvency, or other laws of general application relating to the enforcement of
creditor’s rights.
 
(b) The execution, delivery, and performance by Guarantor of this Guaranty do
not and will not violate or conflict with any law, rule, or regulation or any
order, writ, injunction, or decree of any court, governmental authority or
agency, or arbitrator and do not and will not conflict with, result in a breach
of, or constitute a default under, or result in the imposition of any lien upon
any assets of Guarantor pursuant to the provisions of any indenture, mortgage,
security agreement, franchise, permit, license, or other instrument or agreement
to which Guarantor or its properties are bound.
 
(c) No authorization, approval, or consent of, and no filing or registration
with, any court, governmental authority, or third party is necessary for the
execution, delivery, or performance by Guarantor of this Guaranty or the
validity or enforceability thereof.
 
(d) Guarantor has, independently and without reliance upon Lender and based upon
such documents and information as Guarantor has deemed appropriate, made its own
analysis and decision to enter into this Guaranty, and Guarantor has adequate
means to obtain from Debtor on a continuing basis information concerning the
financial condition and assets of Debtor, and Guarantor is not relying upon
Lender to provide (and Lender shall have no duty to provide) any such
information to Guarantor either now or in the future.
 
(e) The value of the consideration received and to be received by Guarantor is
reasonably worth at least as much as the liability and obligation of Guarantor
hereunder, and such liability and obligation may reasonably be expected to
benefit Guarantor directly or indirectly.
 
12. No Fraudulent Transfer.  It is the intention of Guarantor and Lender that
the amount of the Guaranteed Obligations guaranteed by Guarantor by this
Guaranty shall be in, but not in excess of, the maximum amount permitted by
fraudulent conveyance, fraudulent transfer, or similar laws applicable to
Guarantor.  Accordingly, notwithstanding anything to the contrary contained in
this Guaranty or any other agreement or instrument executed in connection with
the payment of any of the Guaranteed Obligations, the amount of the Guaranteed
Obligations guaranteed by Guarantor by this Guaranty shall be limited to that
amount which after giving effect thereto would not (a) render Guarantor
insolvent, or (b) result in the fair saleable value of the assets of Guarantor
being less than the amount required to pay its debts and other liabilities
(including contingent liabilities) as they mature, are determined under
applicable law, if the obligations of Guarantor hereunder would otherwise be set
aside, terminated, annulled or avoided for such reason by a court of competent
jurisdiction in a proceeding actually pending before such court.  For purposes
of this Guaranty, the term “applicable law” means as to Guarantor each statute,
law, ordinance, regulation, order, judgment, injunction or decree of the United
States or any state or commonwealth, any municipality, any foreign country, or
any territory, possession or tribunal applicable to Guarantor.
 
 
GUARANTY AGREEMENT – PAGE 4
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------

 
 
13. Covenants.  So long as this Guaranty remains in full force and effect,
Guarantor shall, unless Lender shall otherwise consent in writing, comply with
all of the covenants relating to Guarantor set forth in the Loan Documents.
GUARANTOR HEREBY ACKNOWLEDGES AND AGREES THAT WHILE THE LOAN TRANSACTION REMAINS
OUTSTANDING, GUARANTOR WILL NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF LENDER
(WHICH MAY BE WITHHELD IN LENDER’S SOLE AND ABSOLUTE DISCRETION), SELL, LEASE,
ASSIGN, ENCUMBER, HYPOTHECATE, TRANSFER OR OTHERWISE DISPOSE OF ANY ASSETS OF
GUARANTOR EXCEPT FOR TRANSFERS OF ASSETS VALUED AT LESS THAN TEN PERCENT
(10.00%) OF GUARANTOR’S TOTAL ASSETS AND TRANSFERS FOR WHICH GUARANTOR RECEIVES
CONSIDERATION (IN THE FORM OF CASH OR OTHER PHYSICAL ASSET OF COMPARABLE
LIQUIDITY) SUBSTANTIALLY EQUIVALENT TO THE FAIR MARKET VALUE OF THE TRANSFERRED
ASSET (AS DETERMINED BY LENDER).
 
14. Setoff.  As further security for the Indebtedness, Guarantor grants to
Lender a first lien and contractual right of set-off in and to all money and
property of Guarantor now or at any time hereafter coming within the custody or
control of Lender, including (without limitation) all certificates of deposit
and other accounts, whether such certificates of deposit and/or accounts have
matured or not, and whether the exercise of such right of set-off results in
loss of interest or other penalty under the terms of the certificate of deposit
or account agreement.  It is further agreed that Lender shall have a first lien
on all deposits and other sums at any time credited by or due from Lender to
Guarantor as security for the payment of the Indebtedness, and Lender, at its
option after the occurrence of a Default may without notice and without any
liability, hold all or any part of any such deposits or other sums until all
amounts owing under the Loan Documents have been paid in full, and/or Lender may
apply or set-off all or any part of any such deposits or other sums credited by
or due from Lender to or against any sums due under the Loan Documents in any
manner and in any order of preference which Lender, in its sole discretion,
chooses.  The rights and remedies of Lender hereunder are in addition to any
other rights and remedies (including, without limitation, other rights of
setoff) which Lender may have.
 
15. Successors and Assigns.  This Guaranty is for the benefit of Lender and its
successors and assigns, and, the rights and remedies hereunder, to the extent
applicable to any indebtedness assigned, may, subject to the limitations set
forth in the Loan Documents, be transferred with such indebtedness.  This
Guaranty is binding on Guarantor, and its successors and permitted assigns;
provided that, Guarantor may not assign its obligations under this Guaranty
without obtaining the prior written consent of Lender, and any assignment
purported to be made without the prior written consent of Lender shall be null
and void.
 
16. Loan Documents.  The terms of the Loan Documents relating to Guarantor are
incorporated herein by reference, the same as if stated verbatim herein, and
Guarantor agrees that Lender may exercise any and all rights granted to it under
the Loan Documents without affecting the validity or enforceability of this
Guaranty.
 
17. Amendments.  No amendment or waiver of any provision herein nor consent to
any departure therefrom by Guarantor shall be effective unless the same shall be
in writing and signed by Lender, and then, such amendment, waiver, or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
 
18. Time of Essence.  Time shall be of the essence in this Guaranty with respect
to all of Guarantor’s obligations hereunder.
 
19. Governing Law.  Guarantor agrees that this Guaranty shall be deemed to have
been made in the State of Texas at Lender’s address indicated at the beginning
of this Guaranty and shall be governed by, and construed in accordance with, the
laws of the State of Texas and is performable in the City and County of Dallas,
Texas.  In any litigation in connection with or to enforce this Guaranty or any
or any Loan Documents, each Guarantor irrevocably consents to and confer
personal jurisdiction on the courts of the State of Texas or the United States
courts located within the State of Texas.  Nothing contained herein shall,
however, prevent Lender from bringing any action or exercising any rights within
any other state or jurisdiction or from obtaining personal jurisdiction by any
other means available under applicable law.
 
 
GUARANTY AGREEMENT – PAGE 5
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------

 
 
20. Counterparts.  This Guaranty may be executed in multiple counterparts, each
of which, for all purposes, shall be deemed an original, and all of which taken
together shall constitute but one and the same instrument.
 
21. Waiver of Right to Trial By Jury.  GUARANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT,
PROCEEDING, OR COUNTERCLAIM THAT RELATES TO OR ARISES OUT OF THIS GUARANTY OR
ANY OF THE LOAN DOCUMENTS OR THE ACTS OR FAILURE TO ACT OF OR BY LENDER IN THE
ENFORCEMENT OF ANY OF THE TERMS OR PROVISIONS OF THIS GUARANTY OR THE OTHER LOAN
DOCUMENTS.
 
22. Invalid Provisions.  If any provision of this Guaranty is held to be
illegal, invalid or unenforceable under present or future laws, such provision
shall be fully severable and the remaining provisions of this Guaranty shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance.
 
23. Regulation B—Notice of Joint Intent.  If Guarantor is more than one Person,
Federal Regulation B (Equal Credit Opportunity Act) requires Lender to obtain
evidence of Guarantor’s intention to apply for a joint guaranty.  Guarantor’s
signature below shall evidence such intent.  Guarantor’s intent shall apply to
future related extensions of joint credit and joint guaranty.
 
24. PATRIOT ACT NOTICE.  LENDER HEREBY NOTIFIES GUARANTOR THAT PURSUANT TO THE
REQUIREMENTS OF THE USA PATRIOT ACT, 31 U.S.C. § 5318 (THE “ACT”), IT IS
REQUIRED TO OBTAIN, VERIFY AND RECORD INFORMATION THAT IDENTIFIES GUARANTOR,
WHICH INFORMATION INCLUDES THE NAME AND ADDRESS OF GUARANTOR AND OTHER
INFORMATION THAT WILL ALLOW SUCH LENDER TO IDENTIFY GUARANTOR IN ACCORDANCE WITH
THE ACT.
 
25. Fact Act Certification.  Guarantor hereby acknowledges that Lender may
report information about the obligations of Guarantor hereunder to credit
bureaus.  Late payments, missed payments or other defaults on the accounts of
Guarantor may be reflected in the credit reports of Guarantor.
 

--------------------------------------------------------------------------------

NOTICE OF FINAL AGREEMENT
 
THIS GUARANTY REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES, AND THE SAME
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS BETWEEN THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
 

--------------------------------------------------------------------------------

REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
 
 
 
 
 
 
 
 
GUARANTY AGREEMENT – PAGE 6
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------

 
 
EXECUTED as of the Effective Date.
 
GUARANTOR:
ADDRESS:
     
2201 Sunset Blvd.
 
Houston, TX 77005
/s/ JONATHAN P. CARROLL 
 
JONATHAN P. CARROLL
     
INGLESIDE CRUDE LLC
801 Travis Street, Suite 2100
 
Houston, TX 77002
By:           /s/ JONATHAN P. CARROLL
 
Name:         Jonathan P. Carroll
 
Title:           Sole Member
 

GUARANTY AGREEMENT – PAGE 7
SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC
 
 

--------------------------------------------------------------------------------