THIRD AMENDMENT TO
LOAN AGREEMENT DATED JANUARY 14, 1994
BY AND AMONG BLUE DOLPHIN ENERGY COMPANY,
BLUE DOLPHIN PIPE LINE COMPANY, BUCCANEER PIPE LINE CO.,
MISSION ENERGY, INC. D/B/A MEI MISSION ENERGY, INC.,
BLUE DOLPHIN EXPLORATION COMPANY, PREVIOUSLY KNOWN AS
IVORY PRODUCTION CO,. BLUE DOLPHIN SERVICES CO.,
AND BANK ONE, TEXAS, N.A.
THIS THIRD AMENDMENT TO LOAN AGREEMENT (this "AMENDMENT") is entered into
as of November 05, 1996, by and between BLUE DOLPHIN ENERGY COMPANY., BLUE
DOLPHIN PIPE LINE COMPANY, BUCCANEER PIPELINE CO., MISSION ENERGY, INC. D/B/A
MEI MISSION ENERGY, INC., BLUE DOLPHIN EXPLORATION COMPANY, PREVIOUSLY KNOWN AS
IVORY PRODUCTION CO., AND BLUE DOLPHIN SERVICES CO. ("collectively, the
Borrowers"), and BANK ONE, TEXAS, N.A., a NATIONAL ASSOCIATION ("BANK").
WHEREAS, Borrower and Bank entered into that certain Loan Agreement dated
as of January 14, 1994, as amended from time to time (collectively, the "LOAN
AGREEMENT"); and
WHEREAS, the Loan Agreement currently governs Borrower's revolving line of
credit in the maximum amount of $10,000,000.00 (the "LINE OF CREDIT"), as
currently evidenced by that certain promissory note dated January 14, 1994
payable by Borrower to the order of Bank in the stated principal amount of
$10,000,000.00 (the "NOTE"); and
WHEREAS, the Loan Agreement, the Note and all other documents evidencing,
securing, governing, guaranteeing and/or pertaining to the Note are hereinafter
referred to collectively as the "LOAN DOCUMENTS"; and
WHEREAS, the parties hereto now desire to modify the Loan Agreement as
hereinafter provided;
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties, and agreements contained herein, and for other valuable
consideration, the receipt and legal sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 The terms used in this Amendment to the extent not otherwise
defined herein shall have the same meanings as in the Loan Agreement.
Section 1.02 Effective as of the date hereof the term "Termination Date" as
defined on page 10 of the loan agreement, shall mean January 14, 2000.
Section 1.03 Effective as of the date hereof the term "Bank One Base Rate "
as defined on page 2 shall mean the rate of interest per annum then most
recently established by the Bank, from time to time, as its Bank One Base Rate,
which is Eight and one- fourth percent (8.25) as of the date of this Agreement
Section 1.04 Effective as of the date hereof the term "Floating Rate" as
defined on page 4 of the Loan Agreement " shall mean the Bank One Base Rate in
effect from time to time plus one and one-fourth percent (1.25%)."
ARTICLE II
AMENDMENTS
Section 2.01 Effective as of the date hereof, The first sentence of Section
2.04 of the Loan Agreement is hereby amended in its entirety to read as follows:
"The Borrowing Base is hereby established at $1,925,000.00 effective
as of November 05, 1996, declining in the amount of $75,000.00 monthly,
beginning December 01, 1996, and at the beginning of each successive month
thereafter."
Section 2.02 Effective as of the date hereof, Paragraph 6.20 of the Loan
Agreement is hereby amended in its entirety to read as follows:
GENERAL AND ADMINISTRATIVE EXPENSEs:
"Maintain consolidated general and administrative expenses at a level
that is not greater than $1,500,000.00 for each of the Fiscal Years 1996
and 1997 ( effective January 01, 1996 ). Effective January 01, 1998 ( for
FY98 and thereafter ), modify the G & A expense to a maximum of 25% of
total oil & gas and pipeline, related revenues."
Section 2.03 Effective as of the date hereof, Paragraph 7.03
subsection (b) is amended by changing $400,000.00 for 1995 to $600,000.00
for 1996.
Section 2.04 Effective as of the date hereof, Paragraph 7.14 is amended to
read:
CERTAIN CAPITAL EXPENDITURES
"Make any capital expenditures in 1996 for items other than the
Petroport project, offshore abandonment program and acquisitions costs
exceeding $600,000.00. Effective January 01, 1997 BDEC's Maximum capital
expenditures will be $250,000.00 for 1997 and each year thereafter."
ARTICLE III
WAIVERS
Section 3.01 This amendment will also serve as a waiver for the
noncompliance of the following covenants:
a. The G&A covenant from 12/31/95 through 9/30/96
b. The Capital Expenditure covenant violations from 3/31/96
through 9/30/96
ARTICLE IV
NOTE
4.01 Contemporaneously with the execution hereof, Borrower agrees to
execute and deliver to Bank a promissory note (the "RENEWAL NOTE") in the stated
principal amount of $10,000,000.00, in form and substance satisfactory to Bank,
in renewal and extension of the Note.
ARTICLE V
REPRESENTATIONS, WARRANTIES, RATIFICATION AND REAFFIRMATION
Section 5.01 Borrower hereby represents and warrants that: (i) the
representations and warranties contained in the Loan Agreement are true and
correct on and as of the date hereof as though made on and as of the date
hereof, (ii) no event has occurred and is continuing that constitutes an Event
of Default or would constitute an Event of Default but for the requirement of
notice or lapse of time or both, and (iii) there are no claims or offsets
against, or defenses or counterclaims to, the Note, the indebtedness evidenced
thereby or the liens securing same (including without limitation, any defenses
or offsets resulting from or arising out of breach of contract or duty, the
amount of interest charged, collected or received on the Note heretofore, or
breach of any commitments or promises of any type).
Section 5.02 The terms and provisions set forth in this Amendment shall
modify and supersede all inconsistent terms and provisions set forth in the Loan
Agreement, but except as expressly modified and superseded by this Amendment,
the terms and provisions of the Loan Agreement are ratified and confirmed and
shall continue in full force and effect, Borrower hereby agreeing that the Loan
Agreement and the other Loan Documents are and shall continue to be outstanding,
validly existing and enforceable in accordance with their respective terms.
ARTICLE VI
MISCELLANEOUS
Section 6.01 Each of the Loan Documents is hereby amended so that any
reference in the Loan Documents to the Loan Agreement shall mean a reference to
the Loan Agreement as amended hereby.
Section 6.02 This Amendment may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 6.03 This Amendment has been entered into in Xxxxxx County, Texas
and shall be performable for all purposes in Xxxxxx County, Texas. THIS
AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. Courts
within the State of Texas shall have jurisdiction over any and all disputes
arising under or pertaining to this Amendment, and venue in any such dispute
shall be the courts located in Xxxxxx County, Texas.
Section 6.04 This Amendment shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns.
THE WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BE EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
EXECUTED as of the date first above written.
BORROWERS:
BLUE DOLPHIN ENERGY COMPANY.
By:________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
BLUE DOLPHIN PIPE LINE COMPANY
By:________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
BUCCANEER PIPE LINE CO.
By:________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
MISSION ENERGY, INC. D/B/A
MEI MISSION ENERGY INC.
By:________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
BLUE DOLPHIN EXPLORATION
COMPANY PREVIOUSLY KNOWN AS
IVORY PRODUCTION CO.
By:________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
BLUE DOLPHIN SERVICES CO.
By: __________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: President
BANK:
BANK ONE, TEXAS, NATIONAL
ASSOCIATION
By:________________________________
Name: Xxxxxxx X. Xxxxx
Title:Vice President
