Exhibit 10.43
CONTROL AGREEMENT
This CONTROL AGREEMENT, dated as of December 14, 2000, (the
"Control Agreement") is entered into between Heartland Partners, L.P., a
Delaware limited liability partnership (the "Partnership"), HTI Class B, LLC
(the "Grantor"), and CMC Heartland Partners, a Delaware partnership ("CMC
Heartland"), (the Partnership and CMC Heartland are individually and
collectively referred to herein as the "Secured Party").
1. The Grantor and the Secured Party have entered into a certain Security
Agreement executed as of the date hereof (the "Security Agreement").
All capitalized terms used in this Control Agreement shall have the
meaning ascribed to them in the Security Agreement. Pursuant to the
Security Agreement, the Grantor has granted the Secured Party a
security interest in the Collateral, including the Class B Limited
Partnership Interest in the Partnership (the "Pledged Collateral").
The parties are entering into this Control Agreement to perfect the
security interest in the Pledged Collateral.
2. The Partnership represents and warrants to the Secured Party that:
2.1. The Partnership is the issuer of the Pledged Collateral.
2.2. The Pledged Collateral is a security within the meaning of
8-102(a)(15) of the UCC.
2.3. No certificate has been issued to represent the Pledged
Collateral, and the Pledged Collateral is an uncertificated
security within the meaning of 8-102(a)(18) of the UCC.
2.4. The Partnership does not know of any claim to or interest in the
Pledged Collateral, except for claims and interests of the
parties referred to in this Control Agreement.
3. The Partnership will comply with all notifications it receives
directing it to transfer or redeem the Pledged Collateral (each an
entitlement order) originated by the Secured Party without further
consent by the Grantor.
4. Except as otherwise provided in this section, the Partnership will
comply with entitlement orders originated by the Grantor without
further consent by the Secured Party. If the Secured Party notifies
the Partnership that the Secured Party will exercise exclusive control
over the Pledged Collateral (a "notice of exclusive control"), the
Partnership will cease complying with entitlement orders or other
directions concerning the Pledged Collateral originated by the Grantor
and distributing to the Grantor interest and dividends on property in
the Pledged Collateral. Until the Partnership receives a notice of
exclusive control, the Partnership may distribute to the Grantor all
interest and regular cash dividends on property in the Pledged
Collateral. The Partnership will not comply with any entitlement order
originated by the Grantor that would require the Partnership to make a
free delivery to the Grantor or any other person.
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5. The Partnership will not agree with any third party, other than the
Secured Party that the Partnership will comply with entitlement orders
originated by the third party.
6. The Partnership will send copies of all statements and confirmations
for the Pledged Collateral simultaneously to the Grantor and the
Secured Party. The Partnership will use reasonable efforts promptly to
notify the Secured Party and the Grantor if any other person, other
than the Secured Party and the Pari Passu Debt Holders claims that it
has a property interest in property in the Pledged Collateral and that
it is a violation of that person's rights for anyone else to hold,
transfer, or deal with the property.
7. Except for permitting a withdrawal, delivery, or payment in violation
of section 4, the Partnership will not be liable to the Secured Party
for complying with entitlement orders from the Grantor that are
received by the Partnership before the Partnership receives and has a
reasonable opportunity to act on a notice of exclusive control. The
Partnership will not be liable to the Grantor for complying with a
notice of exclusive control or with entitlement orders originated by
the Secured Party, even if the Grantor notifies the Partnership that
the Secured Party is not legally entitled to issue the entitlement
order or notice of exclusive control, unless the Partnership takes the
action after it is served with an injunction, restraining order, or
other legal process enjoining it from doing so, issued by a court of
competent jurisdiction, and had a reasonable opportunity to act on the
injunction, restraining order or other legal process.
8. This Control Agreement does not create any obligation of the
Partnership except for those expressly set forth in this Control
Agreement. In particular, the Partnership need not investigate whether
the Secured Party is entitled under the Secured Party's agreements with
the Grantor to give an entitlement order or a notice of exclusive
control. The Partnership may rely on notices and communications it
believes given by the appropriate party.
9. The Secured Party and the Grantor will indemnify the Partnership, its
officers, directors, employees, and agents against claims, liabilities,
and expenses arising out of this Control Agreement (including
reasonable attorneys' fees and disbursements), except to the extent the
claims, liabilities, or expenses are caused by the Partnership's gross
negligence or willful misconduct. The Secured Party's and the Grantor's
liability under this section is joint and several.
10. The Secured Party may terminate this Control Agreement by notice to the
Partnership and the Grantor. The Partnership may terminate this
Control Agreement on 30 days' notice to the Secured Party and the
Grantor.
11. If the Secured Party notifies the Partnership that the Secured Party's
security interest in the Pledged Collateral has terminated, this
Security Agreement will immediately terminate. Sections 8 and 9 will
survive termination of this Control Agreement.
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12. This Control Agreement will be governed by the laws of the State of
Illinois. The Partnership and the Grantor may not change the law
governing the Pledged Collateral without the Secured Party's express
written agreement.
13. This agreement is the entire agreement, and supersedes any prior
agreements and contemporaneous oral agreements, of the parties
concerning its subject matter.
14. No amendment of, or waiver of a right under, this Control Agreement
will be binding unless it is in writing and signed by the party to be
charged.
15. To the extent a provision of this Control Agreement is unenforceable,
this Control Agreement will be construed as if the unenforceable
provision were omitted.
16. All property credited to the Pledged Collateral will be treated as
financial assets under Article 8 of the Illinois Uniform Commercial
Code.
17. A successor to or assignee of the Secured Party's rights and
obligations under the security agreement between the Secured Party and
the Grantor will succeed to the Secured Party's rights and obligations
under this Control Agreement.
18. A notice or other communication to a party under this Control Agreement
will be in writing, will be sent to the party's address set forth below
or to such other address as the party may notify the other parties and
will be effective on receipt.
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IN WITNESS WHEREOF, the Partnership, Grantor and Secured Party
have caused this Security Agreement to be duly executed as of the day and
year first above written.
Partnership and Secured Party: HEARTLAND PARTNERS, L.P.
By HTI Interests, LLC
Its General Partner
By s/ Xxxxx Xxxxxxxx
Its President & CEO
Secured Party: CMC HEARTLAND PARTNERS
By Heartland Technology, Inc.
as Managing Partner
By s/ Xxxxx Xxxxxxxx
Its President & CEO
Grantor: HTI CLASS B, LLC
By s/ Xxxxx Xxxxxxxx
Its President & CEO
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