Document:

ex105.htm

EX. 10.5

 

SOVEREIGN BANK – LOAN NO.

 

PROMISSORY NOTE

 

	
2,000,000.00

	
MAY 2, 2014

 

FOR VALUE RECEIVED, LAZARUS REFINING & MARKETING, LLC, a Delaware limited liability company (“Debtor”), unconditionally promises to pay to the order of SOVEREIGN BANK, a Texas state bank (together with its successors and assigns, “Lender”), without setoff, at its offices at 17950 Preston Road, Suite 500, Dallas, TX 75252, or at such other place as may be designated by Lender, the principal amount of TWO MILLION AND NO/100 DOLLARS ($2,000,000.00), together with interest computed daily on the outstanding principal balance hereunder, at an annual interest rate (the “Rate”), and in accordance with the payment schedule indicated below.  This PROMISSORY NOTE (this “Note”) is executed pursuant to and evidences a loan funded by Lender under that certain LOAN AND SECURITY AGREEMENT dated as of even date herewith (the “Effective Date”), between Debtor and Lender (as amended, restated or otherwise modified from time to time, the “Loan Agreement”), to which reference is made for a statement of the collateral, rights and obligations of Debtor and Lender in relation thereto, but neither this reference to the Loan Agreement nor any provision thereof shall affect or impair the absolute and unconditional obligation of Debtor to pay unpaid principal of and interest on this Note when due.  Capitalized terms not otherwise defined herein shall have the same meanings as in the Loan Agreement.

 

1. Rate.  Prior to the Maturity Date or an Event of Default, the Rate shall be the LESSER of (a) the MAXIMUM RATE or (b) SIX PERCENT (6.00%).  From and after the Maturity Date, the Rate shall be the Maturity Rate.  Notwithstanding any provision of this Note or any other agreement or commitment between Debtor and Lender, whether written or oral, express or implied, Lender shall never be entitled to charge, receive or collect, nor shall amounts received hereunder be credited so that Lender shall be paid, as interest a sum greater than interest at the Maximum Rate.  It is the intention of the parties that this Note, and all instruments securing the payment of this Note or executed or delivered in connection therewith, shall comply with applicable law.  If Lender ever contracts for, charges, receives or collects anything of value which is deemed to be interest under applicable law, and if the occurrence of any circumstance or contingency, whether acceleration of maturity of this Note, prepayment of this Note, delay in advancing proceeds of this Note or any other event, should cause such interest to exceed the Maximum Rate, any amount which exceeds interest at the Maximum Rate shall be applied to the reduction of the unpaid principal balance of this Note or any other Indebtedness, and if this Note and such other Indebtedness are paid in full, any remaining excess shall be paid to Debtor.  In determining whether the interest exceeds interest at the Maximum Rate, the total amount of interest shall be spread, prorated and amortized throughout the entire term of this Note until its payment in full.  The term “Maximum Rate” as used in this Note means the maximum nonusurious rate of interest per annum permitted by whichever of applicable United States federal law or Texas law permits the higher interest rate, including to the extent permitted by applicable law, any amendments thereof hereafter or any new law hereafter coming into effect to the extent a higher Maximum Rate is permitted thereby.  If at any time the Rate shall exceed the Maximum Rate, the Rate shall be automatically limited to the Maximum Rate until the total amount of interest accrued hereunder equals the amount of interest which would have accrued if there had been no limitation to the Maximum Rate.  To the extent, if any, that Chapter 303 of the Texas Finance Code, as amended, (the “Act”) is relevant to Lender for purposes of determining the Maximum Rate, the parties elect to determine the Maximum Rate under the Act pursuant to the “weekly ceiling” from time to time in effect, as referred to and defined in §303.001-303.016 of the Act; subject, however, to any right Lender subsequently may have under applicable law to change the method of determining the Maximum Rate.

 

2. Accrual Method.  Interest on the Indebtedness evidenced by this Note shall be computed on the basis of a THREE HUNDRED SIXTY (360) day year and shall accrue on the actual number of days elapsed for any whole or partial month in which interest is being calculated.  In computing the number of days during which interest accrues, the day on which funds are initially advanced shall be included regardless of the time of day such advance is made, and the day on which funds are repaid shall be included unless repayment is credited prior to the close of business on the Business Day received as provided herein.

 

 

PROMISSORY NOTE – PAGE 1

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

3. Payment Schedule.  Except as expressly provided herein to the contrary, all payments on this Note shall be applied in the following order of priority: (a) the payment or reimbursement of any expenses, costs or obligations (other than the outstanding principal balance hereof and interest hereon) for which either Debtor shall be obligated or Lender shall be entitled pursuant to the provisions of this Note or the other Loan Documents, (b) the payment of accrued but unpaid interest hereon, and (c) the payment of all or any portion of the principal balance hereof then outstanding hereunder, in the direct order of maturity.  If an Event of Default exists under any of the other Loan Documents, then Lender may, at the sole option of Lender, apply any such payments, at any time and from time to time, to any of the items specified in clauses (a), (b) or (c) above without regard to the order of priority otherwise specified herein and any application to the outstanding principal balance hereof may be made in either direct or inverse order of maturity.  If any payment of principal or interest on this Note shall become due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall be included in computing interest in connection with such payment.  This Note shall be due and payable as follows:

 

(a) ELEVEN (11) consecutive monthly payments of principal and interest, each in an amount sufficient to fully amortize the loan under this Note over a period of THIRTY-SIX (36) months, commencing on JUNE 2, 2014 and continuing on the SAME day of each successive month thereafter (or if no such date, then the LAST day of such month); and

 

(b) ONE (1) final payment of the outstanding principal balance of this Note, including all accrued and unpaid interest thereon, on the earlier of (i) the acceleration of the Indebtedness pursuant to the terms of the Loan Documents; or (ii) MAY 2, 2015 (the earlier of such dates being the “Maturity Date”).

 

4. Delinquency Charge.  In the event any installment owing under this Note, or any part thereof, remains unpaid for TEN (10) or more days past the due date thereof as provided above, Debtor shall pay to Lender, in addition to any other amounts to which Lender may be entitled hereunder, a reasonable late payment fee equal to FIVE PERCENT (5.00%) of the amount of said installment, which amount is stipulated by Debtor to be reasonable in order to compensate Lender for its additional costs incurred as a result of having to attend to such delinquency.  This late charge should be paid only once as to such amount as is due and owing, but promptly, as to each respective late payment.  It is further agreed that the imposition of any such late payment fee shall in no way prejudice or limit Lender’s rights or remedies against Debtor under this Note or any of the other Loan Documents.  In the event any check or other payment item used to make a payment to Lender is dishonored for any reason, Debtor shall pay to Lender, in addition to any other amounts to which Lender may be entitled hereunder, a reasonable processing fee of THIRTY AND NO/100 DOLLARS ($30.00) (or the maximum amount provided from time to time in Section 3.506(b) of the Texas Business and Commerce Code).  This processing fee should be paid once with respect to each dishonor of a check or other payment item.  It is further agreed that the imposition of any such processing fee shall in no way prejudice or limit Lender’s rights or remedies against Debtor under this Note or any of the other Loan Documents.

 

5. Waivers, Consents and Covenants.  Debtor, any indorser or guarantor hereof, or any other party hereto (individually an “Obligor” and collectively “Obligors”) and each of them jointly and severally: (a) waives presentment, demand, protest, notice of demand, notice of intent to accelerate, notice of acceleration of maturity, notice of protest, notice of nonpayment, notice of dishonor, and any other notice required to be given under the law to any Obligor in connection with the delivery, acceptance, performance, default or enforcement of this Note, any indorsement or guaranty of this Note, or any other documents executed in connection with this Note or any other Loan Documents now or hereafter executed in connection with any obligation of Debtor to Lender; (b) consents to all delays, extensions, renewals or other modifications of this Note or the Loan Documents, or waivers of any term hereof or of the Loan Documents, or release or discharge by Lender of any Obligors, or release, substitution or exchange of any security for the payment hereof, or the failure to act on the part of Lender, or any indulgence shown by Lender (without notice to or further assent from any Obligors); (c) agrees that no such action, failure to act or failure to exercise any right or remedy by Lender shall in any way affect or impair the obligations of any Obligors or be construed as a waiver by Lender of, or otherwise affect, any of Lender’s rights under this Note, under any indorsement or guaranty of this Note or under any of the Loan Documents; and (d) agrees to pay, on demand, all costs and expenses of collection or defense of this Note or of any indorsement or guaranty hereof and/or the enforcement or defense of Lender’s rights with respect to, or the administration, supervision, preservation, or protection of, or realization upon, any property securing payment hereof, including, without limitation, reasonable attorney’s fees, including fees related to any suit, mediation or arbitration proceeding, out of court payment agreement, trial, appeal, bankruptcy proceedings or other proceeding, in such amount as may be determined reasonable by any arbitrator or court, whichever is applicable.

 

 

PROMISSORY NOTE – PAGE 2

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

6. Prepayments.  Prepayments may be made in whole or in part at any time without premium or penalty.

 

7. Remedies Upon Default.  Whenever there is an Event of Default under the Loan Documents the entire balance outstanding hereunder and all other obligations of any Obligor to Lender (however acquired or evidenced) shall, at the option of Lender, become immediately due and payable and any obligation of Lender to permit further borrowing under this Note shall immediately cease and terminate.  From and after (a) an Event of Default, or (b) the Maturity Date (whether by acceleration or otherwise), the Rate on the unpaid principal balance of this Note shall be increased at Lender’s discretion up to the lesser of (i) EIGHTEEN PERCENT (18.00%), or (ii) the MAXIMUM RATE (the “Maturity Rate”).  The provisions herein for a Maturity Rate (a) shall not be deemed to extend the time for any payment hereunder or to constitute a “grace period” giving Obligors a right to cure any default, and (b) shall be deemed the contract rate of interest applicable to the outstanding principal balance of the Note from and after the occurrence of one of the events set forth in this Section.  At Lender’s option, any accrued and unpaid interest, fees or charges may, for purposes of computing and accruing interest on a daily basis after the due date of this Note or any installment thereof, be deemed to be a part of the principal balance, and interest shall accrue on a daily compounded basis after such date at the Maturity Rate provided in this Note until the entire outstanding balance of principal and interest is paid in full.  Upon an Event of Default, Lender is hereby authorized at any time, at its option and without notice or demand, to set off and charge against any deposit accounts of any Obligor (as well as any money, instruments, securities, documents, chattel paper, credits, claims, demands, income and any other property, rights and interests of any Obligor), which at any time shall come into the possession or custody or under the control of Lender or any of its agents, affiliates or correspondents, any and all obligations due hereunder.  Additionally, Lender shall have all rights and remedies available under each of the Loan Documents, as well as all rights and remedies available at law or in equity.

 

8. Waiver.  The failure at any time of Lender to exercise any of its options or any other rights hereunder shall not constitute a waiver thereof, nor shall it be a bar to the exercise of any of its options or rights at a later date.  All rights and remedies of Lender shall be cumulative and may be pursued singly, successively or together, at the option of Lender.  The acceptance by Lender of any partial payment shall not constitute a waiver of any default or of any of Lender’s rights under this Note.  No waiver of any of its rights hereunder, and no modification or amendment of this Note, shall be deemed to be made by Lender unless the same shall be in writing, duly signed on behalf of Lender; each such waiver shall apply only with respect to the specific instance involved, and shall in no way impair the rights of Lender or the obligations of Obligors to Lender in any other respect at any other time.

 

9. Applicable Law, Venue and Jurisdiction.  Debtor agrees that this Note shall be deemed to have been made in the State of Texas at Lender’s address indicated at the beginning of this Note 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 Texas indicated at the beginning of this Note.  In any litigation in connection with or to enforce this Note or any indorsement or guaranty of this Note or any Loan Documents, Obligors, and each of them, irrevocably consent 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.

 

10. Partial Invalidity.  The unenforceability or invalidity of any provision of this Note shall not affect the enforceability or validity of any other provision herein and the invalidity or unenforceability of any provision of this Note or of the Loan Documents to any person or circumstance shall not affect the enforceability or validity of such provision as it may apply to other persons or circumstances.

 

11. Binding Effect.  This Note shall be binding upon and inure to the benefit of Obligors and Lender and their respective successors, assigns, heirs and personal representatives, provided, however, that no obligations of Obligors hereunder can be assigned without prior written consent of Lender.

 

 

PROMISSORY NOTE – PAGE 3

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

12. Controlling Document.  To the extent that this Note conflicts with or is in any way incompatible with any other document related specifically to the loan evidenced by this Note, this Note shall control over any other such document, and if this Note does not address an issue, then each other such document shall control to the extent that it deals most specifically with an issue.

 

13. Commercial Purpose.  DEBTOR REPRESENTS TO LENDER THAT THE PROCEEDS OF THIS LOAN ARE TO BE USED PRIMARILY FOR BUSINESS, COMMERCIAL OR AGRICULTURAL PURPOSES AND NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES.  DEBTOR ACKNOWLEDGES HAVING READ AND UNDERSTOOD, AND AGREES TO BE BOUND BY, ALL TERMS AND CONDITIONS OF THIS NOTE.

 

14. Collection.  If this Note is placed in the hands of an attorney for collection, or if it is collected through any legal proceeding at law or in equity or in bankruptcy, receivership or other court proceedings, Debtor agrees to pay all costs of collection, including, but not limited to, court costs and reasonable attorneys’ fees.

 

15. Notice of Balloon Payment.  At maturity (whether by acceleration or otherwise), Debtor must repay the entire principal balance of this Note and unpaid interest then due.  Lender is under no obligation to refinance the outstanding principal balance of this Note (if any) at that time.  Debtor will, therefore, be required to make payment out of other assets Debtor may own; or Debtor will have to find a lender willing to lend Debtor the money at prevailing market rates, which may be higher than the interest rate on the outstanding principal balance of this Note.  If Obligors have guaranteed payment of this Note, Obligors may be required to perform under such guaranty.

 

16. Waiver of Jury Trial.  DEBTOR 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 NOTE 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 NOTE OR THE OTHER LOAN DOCUMENTS.

 

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PROMISSORY NOTE – PAGE 4

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

EXECUTED as of the Effective Date.

 

	
DEBTOR:

	
ADDRESS:

	 	 
	
LAZARUS REFINING & MARKETING, LLC

	
801 Travis Street, Suite 2100

	  	
Houston, TX 77002

	
By:           BLUE DOLPHIN ENERGY COMPANY

	  
	
Its:           Sole Member

	  
	  	  
	
By:           /s/ JONATHAN P. CARROLL

	  
	
Name:      Jonathan P. Carroll

	  
	
Title:        President

	  

 

 

 

 

 

 

PROMISSORY NOTE – PAGE 5

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLCex106.htm

EX. 10.6

 

SOVEREIGN BANK – LOAN NO.

COLLATERAL ASSIGNMENT

THIS COLLATERAL ASSIGNMENT (as amended, modified or restated from time to time, this “Assignment”) dated as of MAY 2, 2014 (the “Effective Date”), is executed by LAZARUS REFINING & MARKETING, LLC, a Delaware limited liability company (“Debtor”), with offices at 801 Travis Street, Suite 2100, Houston, TX 77002, 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, Lender and Debtor have entered into a LOAN AND SECURITY AGREEMENT dated as of the Effective Date (as amended, modified or restated from time to time, the “Loan Agreement”; capitalized terms not defined herein shall have the same meanings as in the Loan Agreement).

 

WHEREAS, Debtor (as successor to LAZARUS ENERGY LLC) and C.L. THOMAS, INC. (the “Counterparty”), are parties to that certain MASTER SERVICE AGREEMENT NO. 1 dated as of OCTOBER 1, 2012 (a true, correct and complete copy of which is attached hereto as Exhibit A, as amended, the “Service Agreement”).

WHEREAS, to further secure Lender in the payment of the Indebtedness (as defined in the Loan Agreement), Debtor desires to transfer, pledge, and assign all of Debtor’s rights, title and interest in and to the Service Agreement to Lender;

 

NOW, THEREFORE, in consideration of the premises herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Debtor hereby agrees in favor of Lender as follows:

 

1. Assignment.  As security for Debtor’s obligation to repay the Indebtedness, Debtor hereby transfers, pledges, and assigns to Lender, its successors and assigns, and grants Lender a security interest in all right, title and interest of Debtor in and to the Service Agreement, including, without limitation, all disbursement rights, reimbursement payments, payment rights, and all other rights to payment under the Service Agreement (collectively, the “Payment Rights”).  This Assignment shall constitute a security agreement within the meaning of the Code.  Debtor hereby irrevocably instructs the Counterparty to make any and all payments owing to Debtor with respect to the Payment Rights directly to Lender.

 

2. Representations and Warranties.  Debtor hereby represents and warrants to Lender that:

 

(a) A true, correct and complete copy of the Service Agreement has been attached to this Assignment as Exhibit A (together with all assignments, amendments, modifications or understandings relating thereto).  The Service Agreement is in full force and effect.

 

(b) Debtor has not executed any prior assignment, pledge or hypothecation of its rights under the Service Agreement or the Payment Rights.  Lender has a first priority lien in the Service Agreement and the Payment Rights.  Debtor will defend at its expense Lender’s right, title and security interest in and to the Service Agreement and the Payment Rights against the claims of any third party.

 

(c) The execution, delivery, and performance of this Assignment by Debtor has been duly authorized by all necessary action by Debtor, and this Assignment constitutes a legal, valid and binding obligation of Debtor, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or similar laws of general application relating to the enforcement of creditors’ rights and except to the extent specific remedies may generally be limited by equitable principles.

 

(d) Debtor’s execution, delivery and performance of this Assignment and the consummation of the transactions contemplated thereby by Debtor, do not (i) conflict with, result in a violation of, or constitute a default under (1) any provision of its organizational documents or other instrument binding upon Debtor, (2) any law, governmental regulation, court decree or order applicable to Debtor, or (3) any contractual obligation, agreement, judgment, license, order or permit applicable to or binding upon Debtor, (ii) require the consent, approval or authorization of any third party which consent or approval has not been obtained, or (iii) result in or require the creation of any lien, charge or encumbrance upon any property or assets of Debtor except as may be expressly contemplated by this Assignment.

 

 

COLLATERAL ASSIGNMENT (THOMAS) – PAGE 1

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

(e) Debtor has no actual knowledge that the Counterparty has asserted any default or non-performance by Debtor of Debtor’s duties and obligations under the Service Agreement, Debtor has performed all of Debtor’s duties and obligations which are now due and performable under the Service Agreement, and no defense or counter-claim exists with respect to the duties and obligations of the Counterparty under the Service Agreement.

 

3. Covenants and Agreements.  Debtor hereby covenants in favor of Lender as follows:

 

(a) Debtor will perform all of its duties and obligations under the Service Agreement in accordance with the terms thereof.  Debtor shall not amend, alter or modify the Service Agreement without the express prior written consent of Lender.

 

(b) Debtor shall promptly notify Lender of any default by Debtor or the Counterparty in the performance of their respective duties and obligations under the Service Agreement and shall immediately remedy any default by Debtor thereunder.

 

(c) Debtor shall execute such further and additional instruments and assignments as may be requested by Lender to vest in Lender a valid security interest in and to all rights, title and interest of Debtor in and to the Service Agreement and the Payment Rights.

 

(d) Debtor will not take any action that would in any manner impair the enforceability of Lender’s security interest in the Service Agreement or the Payment Rights.  Debtor (i) will, if requested by Lender, strictly enforce the terms and conditions of the Service Agreement, and (ii) shall not grant any waiver or indulgence with respect the Service Agreement.

 

4. Lender as Agent.  Debtor hereby agrees as follows:

 

(a) Upon the occurrence and during the continuation of a Event of Default (which includes a default under the Service Agreement), Lender shall be irrevocably appointed agent and attorney-in-fact as to performance by Debtor of its obligations under the Service Agreement, and as to the enforcement of Debtor’s rights and remedies under the Service Agreement;

 

(b) All reasonable costs, expenses and liabilities incurred and payments made by Lender as agent and attorney-in-fact shall be considered a loan by Lender to Debtor which shall be repayable on demand and which shall bear interest at the Maturity Rate (as defined in the Note referred to in the Loan Agreement);

 

(c) Regarding the existence of any Event of Default for purposes of this Assignment, Debtor agrees that the Counterparty may rely upon written certifications from Lender that such an Event of Default exists; and

 

(d) Notwithstanding the foregoing, Lender shall have no obligation whatsoever to perform any of Debtor’s obligations under the Service Agreement.

 

5. Foreclosure.  This Assignment is executed as additional security for the payment of the Indebtedness and all other indebtedness owing or to become owing by Debtor to Lender, and it is expressly stipulated, covenanted and agreed that an Event of Default by Debtor under the terms of the Loan Agreement shall constitute a default under the terms of this Assignment and that foreclosure under this Assignment shall operate to foreclose fully the rights of Debtor arising from the Service Agreement, and in such event, all rights of Debtor under the Service Agreement shall be vested in the successful bidder at such foreclosure.  In addition, Lender shall have all other rights and remedies of a secured party under the Code.

 

 

COLLATERAL ASSIGNMENT (THOMAS) – PAGE 2

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

6. Debtor Remains Liable.  Notwithstanding anything to the contrary contained herein, (a) Debtor shall remain liable under Service Agreement to the extent set forth therein to perform all of Debtor’s duties and obligations thereunder to the same extent as if this Assignment had not been executed; (b) the exercise by Lender of any of its rights hereunder shall not release Debtor from any of its duties or obligations under the Service Agreement; and (c) Lender shall not have any obligation or liability under any Service Agreement by reason of this Assignment, nor shall Lender be obligated to perform any of the obligations or duties of Debtor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

 

7. Receipt of Payments.  All payments with respect to the Payment Rights and other amounts and proceeds received by Debtor in respect of the Service Agreement shall be received in trust for the benefit of Lender and shall be paid to Lender as provided under the Loan Documents.

 

8. General.  Debtor hereby further agrees as follows:

 

(a) No remedy or right conferred upon Lender by operation of law, by this Assignment, Loan Agreement or by any other instrument executed by Debtor in connection therewith is intended to be, nor shall it be, exclusive of any other right or remedy, but each and every remedy or right shall be cumulative and shall be in addition to every other remedy or right conferred upon Debtor and each and every such remedy or right may be pursued by Lender in such manner or order, together or separately, and at such times as Lender may elect.

 

(b) If any term or provision of this Assignment, or the application thereof to any person or circumstance shall, to any extent be invalid or unenforceable, the remainder of this Assignment, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Assignment shall be valid and be enforced to the fullest extent permitted by law.

 

(c) Notice provided for in this Assignment must be in writing, and shall be given or served in the same manner as specified in the Loan Agreement.

 

9. Invalid Provisions.  If any provision of the this Assignment are held to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable and the remaining provisions of this Assignment shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance.

 

10. Counterparts.  This Assignment may be separately executed in any number of counterparts, each of which shall be an original, but all of which, taken together, shall be deemed to constitute one and the same instrument.

 

11. Survival.  All representations and warranties made in this Assignment or in any document, statement, or certificate furnished in connection with this Assignment shall survive the execution and delivery this Assignment and no investigation by Lender or any closing shall affect the representations and warranties or the right of Lender to rely upon them.

 

NOTICE OF FINAL AGREEMENT:

THIS ASSIGNMENT AND THE OTHER LOAN DOCUMENTS REPRESENT 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.

 

COLLATERAL ASSIGNMENT (THOMAS) – PAGE 3

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

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COLLATERAL ASSIGNMENT (THOMAS) – PAGE 4

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

 

EXECUTED as of the date of the acknowledgment below, but to be effective as of the Effective Date.

 

DEBTOR:

 

LAZARUS REFINING & MARKETING, LLC

By:           BLUE DOLPHIN ENERGY COMPANY

Its:           Member

By:           /s/ JONATHAN P. CARROLL

Name:      Jonathan P. Carroll

Title:        President

 

 

 

 

COLLATERAL ASSIGNMENT (THOMAS) – PAGE 5

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

CONSENT OF THE COUNTERPARTY

THE UNDERSIGNED executes this Consent of the Counterparty for the limited purposes of (i) consenting to the collateral assignment of the Service Agreement by Debtor, (ii) acknowledging that Lender is relying upon the Counterparty in the performance of its obligations under the Service Agreement in making the loans contemplated under the Loan Agreement, and (iii) acknowledging that Debtor owns and holds all right, title and interest in the Service Agreement (a true and correct copy of which attached hereto as Exhibit A).    Counterparty hereby consents to the assignment of the Service Agreement from LAZARUS ENERGY LLC to Debtor.

EXECUTED as of the Effective Date.

COUNTERPARTY:

 

C.L. THOMAS, INC.

By:           /s/ GARY RANSCHUBER

Name:      Gary Ranschuber

Title:        Authorized Agent

 

 

 

 

 

COLLATERAL ASSIGNMENT (THOMAS) – PAGE 6

SOVEREIGN BANK – LAZARUS REFINING & MARKETING, LLC

  

  

  

 

EXHIBIT A

SERVICE AGREEMENT

See Attached.

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