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EXHIBIT 10.35
NEGATIVE PLEDGE AGREEMENT
This Negative Pledge Agreement (the "Negative Pledge") is executed
effective 9-9, 1996, by GAINSCO, INC. ("Borrower"), a Texas corporation, and
BANK ONE, TEXAS, NATIONAL ASSOCIATION ("Bank One"), in connection with a loan
from Bank One to Borrower.
1. Obligations. Bank One has agreed to make a loan to Borrower to
be evidenced by a Revolving Promissory Note of even date, in the original
principal sum of $5,000,000.00. The revolving promissory note and all
extensions and renewals thereof and any and all other loans, advances, or
extensions of credit by Bank One to Borrower (whether created directly or
acquired by Bank One indirectly by assignment or otherwise), and whether now
existing or hereafter arising, absolute or contingent, primary or secondary
will be collectively called the "Obligations".
2. Negative Pledge. In consideration of Bank One extending credit
to Borrower, so long as any of the Obligations shall remain unpaid and
outstanding, Borrower agrees not to mortgage, encumber, pledge, or xxxxx x xxxx
upon or security interest in all or any part of Borrower's assets, whether now
owned or hereafter acquired, including without limitation, all stock and other
evidence of ownership in Borrower's subsidiary corporations (all collectively
referred to as the "Assets"). Borrower also will not create, incur, suffer, or
permit to exist any mortgage, deed of trust, pledge, assignment, title
retention, lien, security interest, or any other preferential arrangement,
charge, or encumbrance (including any conditional sale or finance lease), on,
in, or with respect to the Assets, without Bank One's prior written consent.
3. Additional Covenants. So long as any of the Obligations remain
unpaid, Borrower further agrees that: (a) Borrower will not sell, lease,
assign, or convey all or any part of the Assets without first obtaining Bank
One's prior written consent; and (b) Borrower will cause the Assets to be kept
free and clear of any and all liens, mortgage, charges, security interest, and
encumbrances of every character, except for those consented to in writing by
Bank One.
4. Events of Default. The happening of any of the following
events or conditions shall constitute an "Event of Default" hereunder: (a)
Borrower fails or refuses to punctually and properly perform, observe, and
comply with all of the terms, covenants, and conditions of this Negative
Pledge; or (b) Any of the Assets is attached or otherwise levied upon or placed
in the hands of a receiver or other representative of a court.
5. Remedies. Upon the occurrence of an Event of Default, or at
any time thereafter, Bank One may, at its option, among other things, declare
the unpaid principal balance of and the interest accruing on the Obligations to
be immediately due and
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payable, without any notice, presentment, protest, notice of protest, notice of
intent to accelerate, notice of acceleration, or demand of any kind, all of
which are hereby expressly waived.
6. Release of Negative Pledge. Upon full and complete payment of
the Obligations owing by Borrower to Bank One, Bank One will release this
Negative Pledge.
7. Miscellaneous. (a) Borrower agrees to execute any and all
further documents, including financing statements, and to take all actions as
Bank One may require in the furtherance of this Negative Pledge.
(b) This Negative Pledge, together with the covenants and
warranties contained herein, shall inure to the benefit of Bank One and any
subsequent owner of the Obligations, and shall be binding upon Borrower, and
its successors and assigns.
(c) The laws of the Xxxxx xx Xxxxx xxx xx xxx Xxxxxx
Xxxxxx shall govern the rights and duties of Borrower and Bank One hereunder
and the validity, construction, enforcement, and interpretation of this
Negative Pledge. The duties and obligations herein imposed upon Borrower are
performable in Fort Worth, Tarrant County, Texas.
(d) Borrower is making this Negative Pledge Agreement in
order to induce Bank One into making the loan represented by the note described
above, and Borrower acknowledges that Bank One is relying on the covenants and
warranties of the Borrower herein in making that loan.
EXECUTED to be effective on the date first written above.
GAINSCO, INC.
By: /s/ XXXXXX X. XXXXX
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Xxxxxx X. Xxxxx,
Senior Vice President and
Chief Financial Officer
BANK ONE, TEXAS, NATIONAL ASSOCIATION
By: /s/ XXXX X. XXXXXXX
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Xxxx X. Xxxxxxx,
Vice President
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