Document:

Blueprint

 

 Exhibit
10.3

 

DEBT ASSUMPTION AGREEMENT

 

This
DEBT ASSUMPTION AGREEMENT (this “Agreement”),
dated effective as of September 18, 2017 (the “Effective
Date”), is by and among Lazarus Energy Holdings, LLC,
a Delaware limited liability company (“LEH”), Lazarus
Energy, LLC, a Delaware limited liability company
(“LE”), and John
H. Kissick, whose address is c/o Ares Management, LLC, 2000 Avenue
of the Stars, 12th Floor, Los Angeles,
California 90067 (“Kissick”).

 

WHEREAS, LEH is the
obligor on certain notes (as such notes have been amended, modified
or supplemented to the Effective Date, the “LEH Notes”)
issued pursuant to that certain Note Purchase Agreement, dated as
of February 21, 2007, by and among LEH, the other Issuers (as
defined therein), the Initial Noteholders (as defined therein) and
the Gatehouse Guarantor (as defined therein) (as such Note Purchase
Agreement has been amended, modified or supplemented to the
Effective Date, the “LEH Note Purchase
Agreement”);

 

WHEREAS, as of the
Effective Date, (i) the sum of the aggregate principal amount of
and accrued and unpaid interest on the LEH Notes is $3,677,953 (the
“LEH Note
Balance”) and (ii) Kissick is the holder of all of the
LEH Notes;

 

WHEREAS, LE is the
Maker of that certain Promissory Note, dated as of June 1, 2006,
under which Notre Dame Investors, Inc. was the original Payee (as
such Promissory Note has been amended, modified or supplemented to
the Effective Date, the “LE
Note”);

 

WHEREAS, as of the
Effective Date, Kissick is the Payee of the LE Note;

 

WHEREAS, on the
Effective Date, LEH paid, on LE’s behalf, certain obligations
of LE totaling $3,648,742 (the “LEH Payment”)
under that certain Letter Agreement dated as of the Effective Date
among GEL Tex Marketing, LLC, LE, Blue Dolphin Energy Company, LEH
and Jonathan Carroll;

 

WHEREAS, LE and LEH
intend that, as of the Effective Date and in consideration of
LEH’s making of the LEH Payment on LE’s behalf, LE will
assume LEH’s obligations in respect of the LEH Note Balance
by means of (i) the cancelation of the LEH Notes and (ii) the
increase of the principal amount of the LE Note by the amount of
the LEH Note Balance, each on the terms set forth herein (the
“Debt
Assumption”);

 

WHEREAS, Kissick is
willing to agree to Debt Assumption;

 

NOW,
THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:

 

1. Acknowledgement of LEH Payment.
LE hereby acknowledges that LEH made the LEH Payment on LE’s
behalf. LEH hereby agrees that the Debt Assumption constitutes full
satisfaction of any and all obligations of LE to LEH in respect of
the LEH Payment.

 

 

 

1

 

 

 

2. Amendment of the LE Note. To
effect the Debt Assumption, contemporaneously with the execution
and delivery of this Agreement by the parties hereto, LE and
Kissick shall enter into the Sixth Amendment to Promissory Note in
the form attached hereto as Exhibit A effective as of the
Effective Date (the “LE Note Amendment”).

 

3. Cancellation of LEH
Notes.

 

(a) Kissick and LEH
agree that, effective as of the Effective Date and immediately upon
the execution and delivery by LE and Kissick of the LE Note
Amendment, and without further action by Kissick or LEH, (i) the
LEH Notes and the indebtedness represented thereby shall be
canceled, (ii) all amounts owed by LEH under the LEH Notes and the
LEH Note Purchase Agreement shall be deemed paid and discharged in
full, and (iii) neither LEH nor Kissick shall have any further
obligations, liabilities, duties or rights under the LEH Notes and
the LEH Note Purchase Agreement.

 

(b) Without limitation
of the foregoing, Kissick hereby releases and forever discharges
LEH and its affiliates from any and all obligations arising under
the LEH Notes and the LEH Note Purchase Agreement and from any and
all manner of actions, suits, claims and demands whatsoever that
Kissick has or may have against LEH or its affiliates, arising out
of or in any way connected to the LEH Notes and the LEH Note
Purchase Agreement, in each case whether arising before, on or
after the Effective Date. For the avoidance of doubt, the foregoing
release shall not extend to any rights of Kissick under the LE Note
and the LE Note Amendment. Further, and without limitation of the
foregoing, Kissick agrees that, from and after the Effective Date,
Kissick shall have no recourse to LEH for payment of the LEH Note
Balance.

 

(c) Without limitation
of the foregoing, LEH hereby releases and forever discharges
Kissick and his affiliates from any and all obligations arising
under the LEH Notes and the LEH Note Purchase Agreement and from
any and all manner of actions, suits, claims and demands whatsoever
that LEH has or may have against Kissick or his affiliates, arising
out of or in any way connected to the LEH Notes and the LEH Notes
Agreement, in each case whether arising before, on or after the
Effective Date. For the avoidance of doubt, the foregoing release
shall not extend to any rights of LE under the LE Note and the LE
Note Amendment.

 

4. Representations and
Warranties.

 

(a) Representations and Warranties of LEH.
LEH hereby represents and warrants to LE and Kissick
that:

 

(i) LEH has been duly
organized and is validly existing and in good standing under the
laws of the State of Delaware.

 

(ii) LEH
is duly qualified as a foreign entity and in good standing in each
jurisdiction where such qualification is required, except to the
extent the failure to be so qualified or in good standing would not
have a material adverse effect on the ability of LEH to execute,
deliver and perform its obligations under this
Agreement.

 

(iii) LEH
has the limited liability company power and authority to execute,
deliver and perform its obligations under this
Agreement.

 

 

2

 

 

(iv) The
execution and delivery of this Agreement by LEH and the performance
by LEH of its obligations hereunder have been duly authorized by
all necessary limited liability company action on the part of
LEH.

 

(v) This Agreement has
been duly executed and delivered by LEH.

 

(vi) Assuming
the due authorization, execution and delivery of this Agreement by
the other parties hereto, this Agreement constitutes the legal,
valid and binding obligation of LEH, enforceable against LEH in
accordance with its terms.

 

(vii) The
execution and delivery of this Agreement by LEH and the performance
by LEH of its obligations hereunder do not (i) conflict with or
violate any provision of the certificate of formation or limited
liability company agreement of LEH, (ii) conflict with, violate or
result in a breach or default (with or without due notice or lapse
of time or both) under any contract or other instrument to which
LEH is a party or by which LEH or any of its properties is bound,
(iii) violate any judgment, order, ruling or decree applicable to
LEH as a party in interest, (iv) violate any laws or regulations
applicable to LEH or (v) require that LEH obtain any consent or
authorization of, or make any filing with, any person, entity or
governmental authority.

 

(b) Representations and Warranties of LE.
LE hereby represents and warrants to LEH and Kissick
that:

 

(i) LE has been duly
organized and is validly existing and in good standing under the
laws of the State of Delaware.

 

(ii) LE
is duly qualified as a foreign entity and in good standing in each
jurisdiction where such qualification is required, except to the
extent the failure to be so qualified or in good standing would not
have a material adverse effect on the ability of LE to execute,
deliver and perform its obligations under this Agreement and the LE
Note Amendment.

 

(iii) LE
has the limited liability company power and authority to execute,
deliver and perform its obligations under this Agreement and the LE
Note Amendment.

 

(iv) The
execution and delivery of this Agreement and the LE Note Amendment
by LE and the performance by LE of its obligations hereunder and
thereunder have been duly authorized by all necessary limited
liability company action on the part of LE.

 

(v) This Agreement and
the LE Note Amendment have been duly executed and delivered by
LE.

 

(vi) Assuming
the due authorization, execution and delivery of this Agreement and
the LE Note Amendment by the other parties hereto and thereto, this
Agreement and the LE Note Amendment constitute the legal, valid and
binding obligations of LE, enforceable against LE in accordance
with their terms.

 

 

 

3

 

 

 

(vii) The
execution and delivery of this Agreement and the LE Note Amendment
by LE and the performance by LE of its obligations hereunder and
thereunder do not (i) conflict with or violate any provision of the
certificate of formation or limited liability company agreement of
LE, (ii) conflict with, violate or result in a breach or default
(with or without due notice or lapse of time or both) under any
contract or other instrument to which LE is a party or by which LE
or any of its properties is bound, (iii) violate any judgment,
order, ruling or decree applicable to LE as a party in interest,
(iv) violate any laws or regulations applicable to LE or (v)
require that LE obtain any consent or authorization of, or make any
filing with, any person, entity or governmental
authority.

 

5. Governing Law. This Agreement
shall be governed by and construed in accordance with the laws of
the State of Texas, without giving effect to any conflict or choice
of law provision that would result in the imposition of the laws of
another state.

 

6. Further Assurances. The parties
hereto agree to execute, acknowledge and deliver, as appropriate
and commercially reasonable, any and all such other and additional
instruments, notices and other documents and to perform such other
acts as may be reasonably necessary to give full effect to the
transactions contemplated by this Agreement and the LE Note
Amendment.

 

7. Counterparts and Headings. This
Agreement may be executed in any number of counterparts, all of
which shall constitute one and the same agreement, and any party
hereto may execute this Agreement by signing and delivering one or
more counterparts. Delivery of an executed counterpart of this
Agreement electronically or by facsimile shall be effective as
delivery of an original executed counterpart of this Agreement. The
headings in this Agreement are for reference only and do not affect
the interpretation of this Agreement.

 

8. Severability. If any term or
provision of this Agreement is invalid, illegal or unenforceable in
any jurisdiction, such invalidity, illegality or unenforceability
shall not affect any other term or provision of this Agreement or
invalidate or render unenforceable such term or provision in any
other jurisdiction.

 

9. Amendment and Waivers. No
amendment to or rescission, termination or discharge of this
Agreement shall be effective unless it is in writing and signed by
each party to this Agreement. No waiver of any provision of this
Agreement shall be effective unless it is in writing and signed by
the party granting such waiver.

 

10. Successors and Assigns; Third Party
Beneficiaries. This Agreement or any rights or obligations
hereunder, may not be assigned by any party hereto without the
prior written consent of each of the other parties hereto. All
provisions of this Agreement by or for the benefit of any party
hereto shall bind and inure to the benefit of such party’s
successors and permitted assigns. No provision of this Agreement is
intended to confer any rights, benefits, remedies, obligations or
liabilities hereunder upon any person or entity other than the
parties hereto and their respective successors and permitted
assigns, except that the provisions of Sections 3(b) and 3(c) relating to releases of
affiliates of parties hereto shall be to the benefit of such
affiliates.

 

 

 

 

4

 

 

 

11. Entire Agreement. This
Agreement, together with the other agreements and instruments
referred to herein, constitutes the entire agreement and
understanding of the parties hereto with respect to the matters
that are the subject of this Agreement and supersedes all prior
agreements and understandings, whether written or oral, with
respect to such matters.

 

[Remainder of page intentionally left blank. Signature pages to
follow.]

 

 

5

 

IN WITNESS WHEREOF, this Agreement has
been duly executed and delivered by the undersigned parties
effective as of the Effective Date.

 

	

LAZARUS ENERGY HOLDINGS, LLC

 

	

By:

	

/s/
JONATHAN CARROLL

	

Name:

	

Jonathan
Carroll

	

Title:

	

Managing
Member

 

	

LAZARUS ENERGY, LLC

 

 

 

	

By:

	

/s/
JONATHAN CARROLL

	

Name:

	

Jonathan
Carroll

	

Title:

	

President

	

 

	

 

	
/s/ JOHN H.
KISSICK    

	
JOHN
H. KISSICK   

	

 

	

 

 

 

Signature Page to Debt Assumption Agreement

 

EXHIBIT A

 

SIXTH AMENDMENT TO PROMISSORY NOTEBlueprint

 

 Exhibit 10.4

 

SIXTH AMENDMENT TO PROMISSORY NOTE

 

This SIXTH AMENDMENT TO PROMISSORY
NOTE (the
“Amendment”)
by and between Lazarus Energy, LLC, a Delaware limited liability
company (“Maker”),
and John H. Kissick (“Payee”)
is made effective as of September 18, 2017 (the
“Effective
Date”). The Maker and the
Payee shall be referenced individually as a
“Party”
and collectively as “Parties”.

 

WHEREAS, the Maker and the Payee are Parties to that
certain Promissory Note dated June 1, 2006 (as amended, restated,
supplemented or otherwise modified from time to time in accordance
with its provisions, the “Note”),
to which reference is hereby made for all purposes;
and

 

WHEREAS, pursuant to the terms of that certain Debt
Assumption Agreement dated as of the Effective Date among Lazarus
Energy Holdings, LLC, the Maker and the Payee, the Parties desire
to amend the Note as set forth herein.

 

NOW, THEREFORE,
in consideration of the premises and
other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the Parties agree as
follows:

 

1.           

Definitions.
Capitalized terms used and not defined
in this Amendment shall have the respective meanings given them in
the Note.

 

2.          

Amendments to the
Note. The Note is hereby
amended as follows:

 

(a)             

The Principal Amount of the Note is hereby
increased, effective as of the Effective Date, by $3,677,953
(such amount, the “Additional
Principal Amount”).

 

(b)             

Notwithstanding
anything in the Note to the contrary, interest on the Additional
Principal Amount shall begin to accrue on the Effective
Date.

 

3.          

Accrued and Unpaid
Interest. The Payee and the
Maker hereby acknowledge and agree that (a) the outstanding
Principal Amount of the Note as of the Effective Date, including
the Additional Principal Amount, is $4,964,141, and (b) the accrued
and unpaid interest on the Note as of the Effective Date is
$1,829,867.

 

4.          

Limited Effect.
Except as expressly provided hereby,
all of the terms and provisions of the Note and the Deed of Trust
are and shall remain in full force and effect and are hereby
ratified and confirmed by the Maker. The amendments contained
herein shall not be construed as a waiver or amendment of any other
provision of the Note or Deed of Trust or for any purpose except as
expressly set forth herein or a consent to any further or future
action on the part of the Maker that would require the waiver or
consent of the Payee.

 

5.          

Successors and
Assigns. This Amendment shall
inure to the benefit of and be binding upon the Payee and the Maker
and each of their respective successors and
assigns.

 

 

 

1

 

 

 

Counterparts.
This Amendment may be executed in any
number of counterparts, all of which shall constitute one and the
same agreement, and any Party hereto may execute this Amendment by
signing and delivering one or more counterparts. Delivery of an
executed counterpart of this Amendment electronically or by
facsimile shall he effective as delivery of an original executed
counterpart of this Amendment.

 

[Remainder of page intentionally left blank; signature page to
follow]

 

2

 

IN WITNESS WHEREOF,
the Parties hereto have executed this Amendment
effective as of the Effective Date.

 

	

 

	
Lazarus
Energy, LLC, as Maker

	

 

	

 

	

 

	

 

	

 

	
 

	
By:  

	
/s/
JONATHAN
P. CARROLL

	

 

	

 

	

 

	
Name:
Jonathan
P. Carroll

	

 

	

 

	

 

	

Title:
President

	

 

 

 

 

	

 

	
John
H. Kissick, as Payee

	

 

	

 

	

 

	

 

	

 

	
 

	
By:  

	
/s/
JOHN
H. KISSICK

	

 

	

 

	

 

	
Name:
John H. Kissick

	

 

	

 

	

 

	

 

	

 

 

 

Signature Page to Sixth Amendment to Promissory Note

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00277-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00277-of-00352.parquet"}]]