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ThirdParty LongTerm Debt

3 Months Ended

Mar. 31, 2022

(10) Third-Party Long-Term Debt

Outstanding Principal, Debt Issue Costs, and Accrued Interest

Third-party long-term debt, including outstanding principal and accrued interest, as of the dates indicated was as follows:

	March 31,			December 31,
	2022			2021
	(in thousands)
Veritex Loans
LE Term Loan Due 2034 (in default)	$	23,580		$	23,789
LRM Term Loan Due 2034 (in default)		9,777			9,861
Kissick Debt (in default)		10,409			10,210
GNCU Loan
NPS Term Loan Due 2031 (in default)		9,976			10,094
SBA EIDLs
BDEC Term Loan Due 2051		2,025			512
LE Term Loan Due 2050		158			156
NPS Term Loan Due 2050		158			156
Equipment Loan Due 2025		49			53
		56,132			54,831

Less: Current portion of long-term debt, net		(43,004	)		(42,953	)
Less: Unamortized debt issue costs		(2,301	)		(2,351	)
Less: Accrued interest payable (in default)		(8,493	)		(8,689	)
	$	2,334		$	838

Blue Dolphin Energy Company

March 31, 2022 │Page 26

	March 31,			December 31,
	2022			2021
	(in thousands)
Veritex Loans
LE Term Loan Due 2034 (in default)	$	1,674		$	1,674
LRM Term Loan Due 2034 (in default)		768			768
GNCU Loan
NPS Term Loan Due 2031 (in default)		730			730

Less: Accumulated amortization		(871	)		(821	)
	$	2,301		$	2,351

Amortization expense was $0.05 million and $0.03 million for the three months ended March 31, 2022 and 2021, respectively.

Accrued interest related to third-party long-term debt, reflected as accrued interest payable in our consolidated balance sheets, as of the dates indicated consisted of the following:

	March 31,			December 31,
	2022			2021
	(in thousands)
Kissick Debt (in default)	$	5,431		$	5,232
Veritex Loans
LE Term Loan Due 2034 (in default)		2,129			2,338
LRM Term Loan Due 2034 (in default)		875			959
GNCU Loan
NPS Term Loan Due 2031 (in default)		17			136
SBA EIDLs
BDEC Term Loan Due 2051		25			12
LE Term Loan Due 2050		8			6
NPS Term Loan Due 2050		8			6
		8,493			8,689
Less: Accrued interest payable (in default)		(8,493	)		(8,689	)
Long-term Interest Payable, Net of Current Portion	$	-		$	-

As reflected in the table above and elsewhere in this report, we are in default under the LE Term Loan Due 2034, LRM Term Loan Due 2034, NPS Term Loan Due 2031, and the Kissick Debt. Defaults under these secured loan agreements permit the lender to declare the amounts owed under these loan agreements immediately due and payable, exercise their rights with respect to collateral securing obligors’ obligations under these loan agreements, and/or exercise any other rights and remedies available. The debt associated with these loan agreements was classified within the current portion of long-term debt on our consolidated balance sheets at March 31, 2022 and December 31, 2021.

Any exercise by third parties of their rights and remedies under our secured loan agreements will have a material adverse effect on our business operations, including crude oil and condensate procurement and our customer relationships; financial condition; and results of operations. In such a case, the trading price of our Common Stock and the value of an investment in our Common Stock could significantly decrease, which could lead to holders of our Common Stock losing their investment in our Common Stock in its entirety.

We can provide no assurance that: (i) our assets or cash flow will be sufficient to fully repay borrowings under our secured loan agreements, either upon maturity or if accelerated, (ii) LE, LRM, and NPS will be able to refinance or restructure the debt, and/or (iii) third parties will provide future default waivers. Defaults under our secured loan agreements and any exercise by third parties of their rights and remedies related to such defaults may have a material adverse effect on our business, the trading prices of our Common Stock, and on the value of an investment in our Common Stock, and holders of our Common Stock could lose their investment in our Common Stock in its entirety. See “Notes (1) and (3)” to our consolidated financial statements for additional information regarding defaults under our secured loan agreements and their potential effects on our business, financial condition, and results of operations.