Exhibit 1.1
NAVISTAR FINANCIAL 2001-B OWNER TRUST
$500,000,000 Asset Backed Notes
NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION
(SELLER)
UNDERWRITING AGREEMENT
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October 19, 2001
Banc of America Securities LLC
as Representative of the
Several Underwriters named
on Schedule I hereto,
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Navistar Financial Retail Receivables Corporation, a Delaware
corporation (the "Seller"), proposes to form a Delaware common law trust,
Navistar Financial 2001-B Owne r Trust (the "Trust"), pursuant to a Trust
Agreement (the "Trust Agreement") to be dated as of the Closing Date (as
hereinafter defined), between the Seller and Chase Manhattan Bank USA, National
Association, as owner trustee (the "Owner Trustee"), which will issue (i)
$79,638,000 principal amount of its Class A-1 2.44% Asset Backed Notes (the
"Class A-1 Notes"), (ii) $131,715,000 principal amount of its Class A-2 2.83%
Asset Backed Notes (the "Class A-2 Notes"), (iii) $179,000,000 principal amount
of its Class A-3 Floating Rate Asset Backed Notes (the "Class A-3 Notes"), (iv)
$90,897,000 principal amount of its Class A-4 4.37% Asset Backed Notes (the
"Class A-4 Notes"; together with the Class A-1 Notes, the Class A-2 Notes and
the Class A-3 Notes, the "Class A Notes") and (v) $18,750,000 principal amount
of its Class B Notes (the "Class B Notes"; together with the Class A Notes, the
"Notes") pursuant to an Indenture to be dated as of the Closing Date (the
"Indenture") between the Owner Trustee, acting on behalf of the Trust, and The
Bank of New York, as indenture trustee (the "Indenture Trustee"). The Trust will
also issue one or more certificates (the "Certificates") to the Seller
representing the equity of the Trust. The assets of the Trust will include,
among other things, a pool of commercial retail notes evidencing loans secured
by new and used medium and heavy duty trucks, buses and trailers (the
"Receivables"), certain monies due or received thereunder on or after (i) for
the Initial Receivables, October 1, 2001 and (ii) for any Subsequent
Receivables, the date designated by the Seller that precedes the related
Subsequent Transfer Date (in each case, the "Cutoff Date"), security interests
in the vehicles financed thereby, certain accounts, including monies on deposit
in the Reserve Account, Pre-Funding Account and the Negative Carry Account and
the proceeds thereof, the proceeds, if any, of Dealer Liability, International
Purchase Obligations and any Guaranties, the proceeds from claims on certain
insurance policies, the benefits of any lease assignments and certain rights of
the Seller under the related Purchase
Agreement, the related Custodian Agreement and the related Interest Rate Swap.
The Initial Receivables will be transferred to the Trust by the Seller in
exchange for the Notes and the Certificates and the Receivables will be serviced
for the Trust by Navistar Financial Corporation (in its capacity as Servicer,
the "Servicer") pursuant to a Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement") to be dated as of the Closing Date among the Seller, the
Servicer and the Owner Trustee, acting on behalf of the Trust. Capitalized terms
used and not otherwise defined herein shall have the meanings given them in the
Pooling and Servicing Agreement.
This is to confirm the agreement concerning the purchase of the
Notes from the Seller by the several Underwriters named in Schedule I hereto
(the "Underwriters").
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF NFC AND THE
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SELLER. Navistar Fina ncial Corporation ("NFC") and the Seller jointly and
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severally represent and warrant to and agree with the several Underwriters that:
(a) A registration statement on Form S-3 (No. 333-62445) has
been filed by the Seller with the Securities and Exchange Commission
(the "Commission") and has become effective under the Securities Act
of 1933, as amended (the "Securities Act"). Such registration
statement may have been amended or supplemented from time to time
prior to the date hereof. Any such amendment or supplement was filed
with the Commission in accordance with the Securities Act and the
rules and regulations of the Commission thereunder (the "Rules and
Regulations") and any such amendment has become effective under the
Securities Act. The Seller proposes to file with the Commission
pursuant to Rule 424(b) of the Rules and Regulations a prospectus
supplement (the "Prospectus Supplement") to the prospectus dated
October 19, 2001, relating to the Notes and the method of distribution
thereof. Copies of such registration statement, any amendment or
supplement thereto, including the Term Sheet dated October 15, 2001
relating to the Notes (the "Term Sheet") disseminated by the
Underwriters, such prospectus, and the Prospectus Supplement have been
delivered to you. Such registration statement, including exhibits
thereto and the Term Sheet incorporated by reference therein, and such
prospectus, as amended or supplemented to the date hereof, and as
further supplemented by the Prospectus Supplement, are hereinafter
referred to as the "Registration Statement" and the "Prospectus,"
respectively. The conditions to the use of a registration statement on
Form S-3 under the Securities Act have been satisfied. The Seller
filed the Term Sheet on Form 8-K with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
within two business days of its dissemination by the Underwritiers.
(b) The Registration Statement, at the time it became effective,
any post-effective amendment thereto, at the time it became effective,
and the Prospectus, as of the date of the Prospectus Supplement,
complied in all material respects with the applicable requirements of
the Securities Act and the Rules and Regulations and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
rules and regulations of the Commission thereunder and did not include
any untrue statement of a material fact and, in the case of the
Registration Statement and any post-effective amendment thereto, did
not omit to state any material fact required to be stated therein or
necessary to make the
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statements therein not misleading and, in the case of the Prospectus,
did not omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading; on the Closing Date, the Registration
Statement and the Prospectus, as amended or supplemented as of the
Closing Date, will comply in all material respects with the applicable
requirements of the Securities Act and the Rules and Regulations and
the Trust Indenture Act and the rules and regulations of the
Commission thereunder and neither the Prospectus nor any amendment or
supplement thereto will include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The representation and warranty in the
preceding sentence does not apply to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility and
Qualification (Form T-1) of the Indenture Trustee under the Trust
Indenture Act, (ii) that information contained in or omitted from the
Registration Statement or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with the
Underwriters' Information (as defined herein) or (iii) the information
contained in the Swap Counterparty's Information (as defined herein).
The Indenture has been qualified under the Trust Indenture Act.
(c) The Seller has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of
Delaware, with power and authority to own its properties and to
conduct its business as such properties are presently owned and such
business is presently conducted, and had at all relevant times, and
now has, power, authority and legal right to acquire, own and sell the
Receivables.
(d) The representations and warranties of the Seller in Section
3.03 of the Purchase Agreement and Section 6.01 of the Pooling and
Servicing Agreement will be true and correct as of the Closing Date.
(e) The representations and warranties of NFC in Sections 3.01
and 3.02 of the Purchase Agreement and of the Servicer in Section 6.01
of the Pooling and Servicing Agreement will be true and correct as of
the Closing Date.
(f) Each of the Seller and NFC has the power and authority to
execute and deliver this Agreement and to carry out the terms of this
Agreement and the execution, delivery and performance by each of the
Seller and NFC of this Agreement have been duly authorized by each of
the Seller and NFC by all necessary corporate action.
(g) This Agreement has been duly executed and delivered by NFC
and the Seller.
(h) When authenticated by the Ind enture Trustee in accordance
with the Indenture and delivered and paid for pursuant to this
Agreement, the Notes will be duly issued and constitute legal, valid
and binding obligations of the Trust enforceable against the Owner
Trustee, in its capacity as owner trustee of the Trust, in accordance
with their terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, or other similar
laws affecting the enforcement of creditors' rights in
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general and by general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(i) The execution, delivery and performance of this Agreement and the
consummation by each of the Seller and NFC of the transactions contemplated
hereby shall not conflict with, result in any breach of any of the terms and
provisions of or constitute (with or without notice or lapse of time) a default
under, the certificate of incorporation or by-laws of such party, or any
indenture, agreement or other instrument to which either such party is a party
or by which it is bound, or violate any law or, to either such party's
knowledge, any order, rule or regulation applicable to such party of any court
or of any federal or state regulatory body, administrative age ncy or other
governmental instrumentality having jurisdiction over such party or any of its
properties; and, except for the registration of the Notes under the Securities
Act, the qualification of the Indenture under the Trust Indenture Act and such
consents, approvals, authorizations, registrations or qualifications as may be
required under the Exchange Act, and applicable state securities laws in
connection with the purchase and distribution of the Notes by the Underwriters,
no permit, consent, approval of, or declaration to or filing with, any
governmental authority is required in connection with the execution, delivery
and performance of this Agreement or the consummation of the transactions
contemplated hereby.
(j) There are no proceedings or, to either of the Seller's or NFC's
knowledge, investigations pending or, to such party's knowledge, threatened
before any court, regulatory body, administrative agency or other tribunal or
governmental instrumentality having jurisdiction over such party or its
properties (i) asserting the invalidity of this Agreement or any of the Notes,
(ii) seeking to prevent the issuance of any of the Notes or the consummation of
any of the transactions contemplated by this Agreement, (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by such party of its obligations under, or the validity or
enforceability of, the Notes or this Agreement, or (iv) that may adversely
affect the federal or state income, excise, franchise or similar tax attributes
of the Notes.
(k) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the Registration Statement
by the Securities Act or by the Rules and Regulations and which have not been so
described or filed.
(l) The Seller (i) is not in violation of its certificate of incorporation
or bylaws, (ii) is not in default, in any material respect, and no event has
occurred which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or condition
contained in any indenture, agreement, mortgage, deed of trust or other
instrument to which the Seller is a party or by which the Seller is bound or to
which any of the Seller's property or assets is subject or (iii) is not in
violation in any respect of any law, order, rule or regulation applicable to the
Seller or any of the Seller's property of any court or of any federal or state
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over it or any of its property, except any violation or
default that would not have a material adverse
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effect on the condition (financial or otherwise), results of
operations, business or prospects of the Seller.
(m) The Purchase Agreement, the Custodian Agreement, the
Administration Agreement and the Further Transfer and Servicing
Agreements conform in all material respects with the descriptions
thereof contained in the Registration Statement and the Prospectus.
(n) Neither the Trust nor the Seller is an "investment
company" or under the "control" of an "investment company" within the
meaning thereof as defined in the Investment Company Act of 1940, as
amended.
(o) None of NFC, the Seller or anyone acting on its behalf
has taken any action that would require qualification of the Trust
Agreement under the Trust Indenture Act.
2. PURCHASE BY THE UNDERWRITERS. On the basis of the
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representations, warranties and agreements contained herein, and subject to the
terms and conditions set forth herein, the Seller agrees to issue and sell to
each of the Underwriters, severally and not jointly, and each of the
Underwriters, severally and not jointly, agrees to purchase from the Seller, the
respective principal amount of the Notes set forth opposite the name of such
Underwriter in Schedule I hereto at a purchase price equal to (i) with respect
to the Class A-1 Notes, 99.890000% of the principal amount thereof, (ii) with
respect to the Class A-2 Notes, 99.831507% of the principal amount thereof,
(iii) with respect to the Class A-3 Notes, 99.775000% of the principal amount
thereof, (iv) with respect to the Class A-4 Notes, 99.722824% of the principal
amount thereof, and (v) with respect to the Class B Notes, 99.620767% of the
principal amount thereof.
The Seller shall not be obligated to sell or deliver any of
the Notes except upon payment for all the Notes to be purchased as provided
herein.
3. DELIVERY OF AND PAYM ENT FOR THE NOTES. Delivery of and
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payment for the Notes shall be made at the office of Xxxxxxxx & Xxxxx, or at
such other place as shall be agreed upon by Banc of America Securities LLC, as
representative of the Underwriters (the "Representative") and the Seller, at
10:00 A.M., New York City time, on November 1, 2001, or at such other date or
time, not later than five full business days thereafter, as shall be agreed upon
by the Representative and the Seller (such date and time being referred herein
as the "Closing Date"). On the Closing Date, the Seller shall deliver or cause
to be delivered to the Representative for the account of each Underwriter the
Notes against payment to or upon the order of the Seller of the purchase price
in immediately available funds. Time shall be of the essence, and delivery at
the time and place specified pursuant to this Agreement is a further condition
of the obligation of each Underwriter hereunder. Upon delivery, each class of
the Notes shall be represented by one or more global certificates registered in
the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"). The
interest of the beneficial owners of the Notes will be represented by
book-entries on the records of DTC and participating members thereof. Definitive
certificates representing the Notes will be available only under limited
circumstances.
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4. FURTHER AGREEMENTS OF THE SELLER. The Seller agrees with each of
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the several Underwriters:
(a) To file the Prospectus Supplement with the Commission pursuant to
and in accordance with Rule 424(b) of the Rules and Regulations within the
time period prescribed by such rule and provide evidence satisfactory to
the Representative of such timely filing.
(b) During any period in which a prospectus relating to the Notes is
required to be delivered under the Securities Act: to advise the
Representative promptly of any proposal to amend the Registration Statement
or amend or supplement the Prospectus and not to effect any such amendment
or supplementation without the consent of the Representative; to advise the
Representative promptly of (i) the effectiveness of any post-effective
amendment to the Registration Statement, (ii) any request by the Commission
for any amendment of the Registration Statement or the Prospectus or for
any additional information, (iii) the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or
the initiation or threatening of any proceedings for that purpose, (iv) the
issuance by the Commission of any order preventing or suspending the use of
any prospectus relating to the Notes or the initiation or threatening of
any proceedings for that purpose and (v) the receipt by the Seller of any
notification with respect to the suspension of the qualification of the
Notes for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and to use best efforts to prevent the
issuance of any such stop order or of any order preventing or suspending
the use of any prospectus relating to the Notes or suspending any such
qualification and, if any such stop order or order of suspension is issued,
to obtain the lifting thereof at the earliest possible time.
(c) If, during any period in which, in the opinion of counsel to the
Underwriters, a prospectus is required by law to be delivered in connection
with the sale of Notes, any event shall have occurred as a result of which
the Prospectus, as then amended or supplemented, would include an untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
when such Prospectus is delivered to a purchaser, not misleading, or if for
any other reason it shall be necessary at such time to amend or supplement
the Prospectus in order to comply with the Securities Act, to notify the
Representative immediately thereof, and to promptly prepare and file with
the Commission, subject to paragraph (b) of this Section 4, an amendment or
a supplement to the Prospectus such that the statements in the Prospectus,
as so amended or supplemented will not, in the light of the circumstances
when the Prospectus is delivered to a purchaser, be misleading, or such
that the Prospectus will comply with the Securities Act.
(d) To furnish promptly to each of the Representative and counsel for
the Underwriters a signed copy of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith; and during
the period described in paragraph (c) of this Section 4, to deliver
promptly without charge to the Representative such number of the following
documents as the Representative may from time to time reasonably request:
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(i) conformed copies of the Registration Statement as originally filed with
the Commission and each amendment thereto (in each case excluding exhibits
other than this Agreement, the Purchase Agreement, the Custodian Agreement,
the Administration Agreement and the Further Transfer and Servicing
Agreements) and (ii) any preliminary prospectus supplement, the Term Sheet,
the Prospectus and any amendment or supplement thereto.
(e) During the period described in paragraph (c) of this Section 4, to
file promptly with the Commission any amendment to the Registration
Statement or the Prospectus or any supplement to the Prospectus that may,
in the judgment of the Seller, or, in the reasonable judgment of the
Representative, be required by the Securities Act or requested by the
Commission.
(f) For so long as any of the Notes are outstanding, to furnish to the
Underwriters (i) copies of all materials furnished by the Trust to the
Noteholders and all reports and financial statements furnished by the Trust
to the Commission pursuant to the Exchange Act or any rule or regulation of
the Commission thereunder and (ii) from time to time, such other
information concerning the Seller and the Trust as the Representative may
reasonably request.
(g) Promptly from time to time to take such action as the
Representative may reasonably request to qualify the Notes for offering and
sale under the securities laws of such jurisdictions as the Representative
may request and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Notes; provided that in
connection therewith the Seller shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any jurisdiction.
(h) For a period of 30 days from the date of the Prospectus, to not
offer for sale, sell, contract to sell or otherwise dispose of, directly or
indirectly, or file a registration statement for, or announce any offering
of, any securities collateralized by, or evidencing an ownership interest
in, a pool of commercial retail notes evidencing loans secured by, new and
used medium and heavy duty trucks, buses and trailers (other than the
Notes) without the prior written consent of the Representative.
(i) For a period from the date of this Agreement until the retirement
of the Notes, or until such time as no Underwriter shall maintain a
secondary market in the Notes, whichever occurs first, to deliver to you
the annual statement of compliance and the annual independent certified
public accountants' report furnished to the Owner Trustee and the Indenture
Trustee, pursuant to the Pooling and Servicing Agreement, as soon as such
statements and reports are furnished to the Owner Trustee and the Indenture
Trustee, respectively.
(j) To the extent, if any, that the ratings provided with respect to
the Notes by Standard & Poor's Ratings Services ("S&P") and Xxxxx'x
Investors Service, Inc. ("Moody's") are conditional upon the furnishing of
documents or the taking of any other actions by NFC or the Seller, to
furnish such documents and take any such other actions.
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(k) On or prior to each Subsequent Transfer Date, to deliver to the
Representative (i) a duly executed Subsequent Transfer Assignment including
a schedule of the Subsequent Receivables to be transferred to the Trust on
such Subsequent Transfer Date, (ii) a copy of the Officer's Certificate
delivered to the Indenture Trustee and the Owner Trustee confirming the
satisfaction of the conditions specified in Section 2.02(b) of the Pooling
and Servicing Agreement, (iii) a copy of the Opinion of Counsel with
respect to the transfer of the Subsequent Receivables to be transferred to
the Trust on such Subsequent Transfer Date to be delivered to the Rating
Agencies pursuant to Section 2.02(b)(ix) of the Pooling and Servicing
Agreement, (iv) a copy of the written confirmation from a firm of
independent nationally recognized certified public accountants to be
delivered to the Trust and the Indenture Trustee pursuant to Section
2.02(b)(x) of the Pooling and Servicing Agreement and (v) a copy of the
written confirmation of S&P received by the Seller pursuant to Section
2.02(b)(xi) of the Pooling and Servicing Agreement.
5. REPRESENTATION OF THE UNDERWRITERS. Each Underwriter hereby
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represents and warrants that the Term Sheet constitutes the only "Series Term
Sheet" (as such term is defined in the no-action letter addressed to Greenwood
Trust Company, Discover Card Master Trust I, dated April 5, 1996) and the only
"Computational Materials," "ABS Term Sheets," "Structural Term Sheets" or
"Collateral Term Sheet" (as such terms are defined in the no-action letters
addressed to Xxxxxx, Xxxxxxx Acceptance Corporation I, et al., dated May 20,
1994 and to the Public Securities Association, dated February 17, 1995)
disseminated by it in connection with offering of the Notes contemplated
hereunder.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective
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obligations of the several Underwriters hereunder are subject to the accuracy,
when made and on the Closing Date, of the representations and warranties of NFC
and the Seller contained herein, to the accuracy of the statements of NFC or the
Seller made in any certificates pursuant to the provisions hereof, to the
performance by the Seller of its obligations hereunder, and to each of the
following additional terms and conditions:
(a) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for
inclusion of additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with to the reasonable
satisfaction of the Representative; and the Seller shall have filed the
Prospectus Supplement with the Commission pursuant to Rule 424(b) of the
Rules and Regulations within the time period prescribed by such rule.
(b) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Notes, the Purchase
Agreement, the Custodian Agreement, the Administration Agreement, the
Further Transfer and Servicing Agreements, the Registration Statement and
the Prospectus, and all other legal matters relating to such agreements and
the transactions contemplated hereby and thereby shall be reasonably
satisfactory in all material respects to counsel for the Underwriters,
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and the Seller shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon such
matters.
(c) Xxxxxxxx & Xxxxx shall have furnished to the Representative their
written opinions, as counsel to the Seller, addressed to the Underwriters and
dated the Closing Date, in form and substance reasonably satisfactory to the
Representative, regarding general corporate matters, enforceability of the
Notes, the Purchase Agreement, the Custodian Agreement and the Further Transfer
and Servicing Agreements, creation of security interests, securities laws and
other matters.
(d) Xxxxxxxx & Xxxxx shall have furnished to the Representative their
written opinion, as counsel to the Seller, addressed to the Underwriters and
dated the Closing Date, in form and substance reasonably satisfactory to the
Representative, with respect to the characterization of the transfer of the
Receivables by NFC to the Seller pursuant to the Purchase Agreement as a sale
and the non-consolidation of NFC and the Seller.
(e) The Representative shall have received from Xxxxx, Xxxxx & Xxxxx,
counsel for the Underwriters, such opinion or opinions, dated the Closing Date,
with respect to such matters as the Representative may require, and the Seller
shall have furnished to such counsel such documents as they reasonably request
for enabling them to pass upon such matters.
(f) Xxxxx, Xxxxxxx, Xxxxxxx & Xxxxx shall ha ve furnished to the
Representative their written opinion, as counsel to the Owner Trustee, addressed
to the Underwriters and dated the Closing Date, in form and substance reasonably
satisfactory to the Representative.
(g) Xxxxxxxx, Xxxxxx & Xxxxxx shall have furnished to the
Representative their written opinion with respect to perfection of security
interests and other matters, as counsel to the Trust and as special counsel to
the Seller, addressed to the Underwriters and dated the Closing Date, in form
and sub stance reasonably satisfactory to the Representative.
(h) Xxxxx, Xxxxxx & Xxxxxx shall have furnished to the Representative
their written opinion, as counsel to the Indenture Trustee, addressed to the
Underwriters and dated the Closing Date, in form and substance reasonably
satisfactory to the Representative.
(i) The Representative shall have received a letter dated the date
hereof (the "Procedures Letter") from a firm of independent nationally
recognized certified public accountants acceptable to the Representative
verifying the accuracy of such financial and statistical data contained in the
Prospectus as the Representative shall deem advisable. In addition, if any
amendment or supplement to the Prospectus made after the date hereof contains
financial or statistical data, the Representative shall have received a letter
dated the Closing Date confirming the Procedures Letter and providing additional
comfort on such new data.
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(j) The Representative shall have received certificates, dated
the Closing Date, of any two of the Chairman of the Board, the
President, any Vice President and the chief financial officer of each
of NFC and the Seller stating that (A) the representations and
warranties of NFC or the Seller, as the case may be, contained in this
Agreement, the Purchase Agreement, the Custodian Agreement, the
Administration Agreement and the Further Transfer and Servicing
Agreements are true and correct on and as of the Closing Date, (B) NFC
or the Seller, as the case may be, has complied with all agreements and
satis fied all conditions on its part to be performed or satisfied
hereunder and under such agreements at or prior to the Closing Date,
(C) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to the best of his or her knowledge, are contemplated by
the Commission, and (D) since July 31, 2001, there has been no material
adverse change in the financial position or results of operations of
NFC, the Seller or the Trust or any change, or any development
including a prospective change, in or affecting the condition
(financial or otherwise), results of operations, business or prospects
of NFC, the Seller or the Trust except as set forth in or contemplated
by the Registration Statement and the Prospectus. Any officer making
such certification may rely upon his or her knowledge as to the
proceedings pending or threatened.
(k) The Notes shall have been given a rating by S&P or Moody's
that is at least equal to or better than the rating required for such
class of Notes as set forth in the Prospectus Supplement.
(l) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or the over-the-counter market shall have been suspended or
limited, or minimum prices shall have been established on either of
such exchanges or such market by the Commission, by such exchange or by
any other regulatory body or governmental authority having
jurisdiction, or trading in securities of NFC on any exchange or in the
over-the-counter market shall have been suspended or (ii) a general
moratorium on commercial banking activities shall have been declared by
Federal or New York State authorities or (iii) a major disruption in
the securities settlement process or (iv) an outbreak or escalation of
hostilities or of acts of terrorism or a declaration by the United
States of a national emergency or war or such a material adverse change
in general economic, political or financial conditions (or the effect
of international conditions on the financial markets in the United
States shall be such) as to make it, in the judgment of a majority in
interest of the several Underwriters, impracticable or inadvisable to
proceed with the public offering or the delivery of the Notes on the
terms and in the manner contemplated in the Prospectus.
(m) The Certificates shall have been delivered to the Seller
in accordance with the Trust Agreement.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
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7. TERMINATION. The obligations of the Underwriters hereunder
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may be terminated by the Representative, in its absolute discretion, by notice
given to and received by the Seller prior to delivery of and payment for the
Notes if, prior to that time, any of the events described in Section 6(l) shall
have occurred or any of the conditions described in Section 6(j) or 6(k) shall
not be satisfied.
8. DEFAULTING UNDERWRITERS.
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(a) If, any one or more of the Underwriters shall fail to
purchase and pay for any of the Notes agreed to be purchased by such
Underwriter hereunder on the Closing Date, and such failure constitutes
a default in the performance of its or their obligations under this
Agreement, the Representative may make arrangements for the purchase of
such Notes by other persons satisfactory to the Seller and the
Representative, including any of the Underwriters, but if no such
arrangements are made by the Closing Date, then each remaining
non-defaulting Underwriter shall be severally obligated to purchase the
Notes which the defaulting Underwriter or Underwriters agreed but
failed to purchase on the Closing Date in the respective proportions
which the principal amount of the Notes set forth opposite the name of
each remaining non-defaulting Underwriter in Schedule I hereto bears to
the aggregate principal amount of the Notes set forth opposite the
names of all the remaining non-defaulting Underwriters in Schedule I
hereto; provided, however, that the remaining non-defaulting
Underwriters shall not be obligated to purchase any of the Notes on the
Closing Date if the aggregate principal amount of the Notes which the
defaulting Underwriter or Underwriters agreed but failed to purchase on
such date exceeds one-eleventh of the aggregate principal amount of the
Notes to be purchased on the Closing Date, and any remaining
non-defaulting Underwriter shall not be obligated to purchase in total
more than 110% of the principal amount of the Notes which it agreed to
purchase on the Closing Date pursuant to the terms of Section 2. If the
foregoing maximums are exceeded and the remaining Underwriters or other
underwriters satisfactory to the Representative and the Seller do not
elect to purchase the Notes which the defaulting Underwriter or
Underwriters agreed but failed to purchase, this Agreement shall
terminate without liability on the part of any non-defaulting
Underwriter or the Seller, except that the Seller will continue to be
liable for the payment of expenses to the extent set forth in Sections
9 and 13 and except that the provisions of Sections 10 and 11 shall not
terminate and shall remain in effect. As used in this Agreement, the
term "Underwriter" includes, for all purposes of this Agreement unless
the context otherwise requires, any party not listed in Schedule I
hereto who, pursuant to this Section 8, purchases Notes which a
defaulting Underwriter agreed but failed to purchase.
(b) Nothing contained herein shall relieve a defaulting
Underwriter of any liability it may have for damages caused by its
default. If other underwriters are obligated or agree to purchase the
Notes of a defaulting Underwriter, either the Representative or the
Seller may postpone the Closing Date for up to seven full business days
in order to effect any changes that in the opinion of counsel for the
Seller or counsel for the Underwriters may be necessary in the
Registration Statement, the Prospectus or in any other document or
arrangement, and the Seller agrees to file promptly any amendment or
supplement to the Registration Statement or the Prospectus that effects
any such changes.
11
9. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) notice
---------------------------------------
shall have been given pursuant to Section 7 terminating the obligations of the
Underwriters hereunder, (b) the Seller shall fail to tender the Notes for
delivery to the Underwriters for any reason permitted under this Agreement or
(c) the Underwriters shall decline to purchase the Notes for any reason
permitted under this Agreement, the Seller shall reimburse the Underwriters for
the fees and expenses of their counsel and for such other out-of-pocket expenses
as shall have been reasonably incurred by them in connection with this Agreement
and the proposed purchase of the Notes, and upon demand the Seller shall pay the
full amount thereof to the Representative. If this Agreement is terminated
pursuant to Section 8 by reason of the default of one or more Underwriters, the
Seller shall not be obligated to reimburse any defaulting Underwriter on account
of those expenses.
10. INDEMNIFICATION.
---------------
(a) NFC and the Seller shall, jointly and severally, indemnify
and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the
Securities Act (collectively referred to for the purposes of this
Section 10 and Section 11 as the Underwriter) against any loss, claim,
damage or liability, joint or several, to which that Underwriter may
become subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage or liability (or any action in respect thereof)
arises out of or is based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary
prospectus supplement, the Term Sheet, the Registration Statement or
the Prospectus or in any amendment or supplement thereto or (ii) the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they are made, not misleading,
and shall reimburse each Underwriter for any legal or other expenses
reasonably incurred by that Underwriter in connection with
investigating or preparing to defend or defending against or appearing
as a third party witness in connection with any such loss, claim,
damage or liability (or any action in respect thereof) as such expenses
are incurred; provided, however, that neither NFC nor the Seller shall
be liable in any such case to the extent that any such loss, claim,
damage or liability (or any action in respect thereof) arises out of or
is based upon an untrue statement or alleged untrue statement in or
omission or alleged omission from any preliminary prospectus
supplement, the Term Sheet, the Registration Statement or the
Prospectus or any such amendment or supplement in reliance upon and in
conformity with the Underwriters' Information; provided, further, that
neither NFC nor the Seller shall be liable to Banc of America
Securities LLC or any person who controls Banc of America Securities
LLC in any such case to the extent that any such loss, claim, damage or
liability (or any action in respect thereof) arises out of or is based
upon an untrue statement or alleged untrue statement in or omission or
alleged omission from any preliminary prospectus supplement, the Term
Sheet, the Registration Statement or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with the
Swap Counterparty's Information. The parties acknowledge and agree that
the written information furnished to the Seller through Banc of America
Securities LLC by or on behalf of the Bank of America, N.A. (the "Swap
Counterparty's Information") consists solely of the information under
the heading "The Trust-The Swap Counterparty" in the Prospectus
Supplement.
12
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Seller, each of its directors, each officer of the Seller who
signed the Registration Statement and each person, if any, who controls the
Seller within the meaning of Section 15 of the Securities Act (collectively refe
rred to for the purposes of this Section 10 and Section 11 as the Seller),
against any loss, claim, damage or liability, joint or several, to which the
Seller may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage or liability (or any action in respect thereof) arises
out of or is based upon (i) any untrue statement or alleged untrue statement of
a material fact contained in any preliminary prospectus supplement, the Term
Sheet, the Registration Statement or the Prospectus or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made, not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with the written information furnished to the Seller by
or on behalf of such Underwriter specifically for use therein, and shall
reimburse the Seller for any legal or other expenses reasonably incurred by the
Seller in connection with investigating or preparing to defend or defending
against or appearing as third party witness in connection with any such loss,
claim, damage or liability (or any action in respect thereof) as such expenses
are incurred. The parties acknowledge and agree that the written information
furnished to the Seller through the Representative by or on behalf of the
Underwriters (the "Underwriters' Information") consists solely of the second
paragraph of text and the following table, the fifth paragraph of text and the
last sentence of the last paragraph of text, each under the caption
"Underwriting" in the Prospectus Supplement.
(c) Promptly after receipt by an indemnified party under this Section
10 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 10, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 10 except to the extent it has
been materially prejudiced by such failure; and, provided, further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 10.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the Representative shall have the right to employ one counsel to represent
jointly the Representative and those other Underwriters and their respective
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the
13
Underwriters against NFC or the Seller under this Section 10 if, in the
reasonable judgment of the Representative, it is advisable for the
Representative and those Underwriters and controlling persons to be
jointly represented by separate counsel because there may be one or
more legal defenses available to such parties which are different from
or additional to those available to the indemnifying party, and in that
event the fees and expenses of such separate counsel shall be paid by
NFC or the Seller. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 10(a) and 10(b), shall use
all reasonable efforts to cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be
liable for any settlement of any such action effected without its
written consent (which consent shall not be unreasonably withheld), but
if settled with its written consent or if there be a final judgment of
the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.
The obligations of NFC, the Seller and the Underwriters in
this Section 10 and in Section 11 are in addition to any other liability which
NFC, the Seller or the Underwriters, as the case may be, may otherwise have.
11. CONTRIBUTION. If the indemnification provided for in
------------
Section 10 is unavailable or insufficient to hold harmless an indemnified party
under Section 10(a) or (b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability (i)
in such proportion as shall be appropriate to reflect the relative benefits
received by NFC and the Seller on the one hand and the Underwriters on the other
from the offering of the Notes or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of NFC and the Seller on the one hand and the
Underwriters on the other with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, as well as any other relevant
equitable considerations. The relative benefits received by NFC and the Seller
on the one hand and the Underwriters on the other with respect to such offering
shall be deemed to be in the same proportion as the total net proceeds from the
offering of the Notes purchased under this Agreement (before deducting expenses)
received by the Seller bear to the total underwriting discounts and commissions
received by the Underwriters with respect to the Notes purchased under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus Supplement. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by NFC or the Seller on the one hand or the Underwriters on
the other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission.
NFC, the Seller and the Underwriters agree that it would not
be just and equitable if contributions pursuant to this Section 11 were to be
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amo unt
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability
14
referred to above in this Section 11 shall be deemed to include,
subject to the limitations on the fees and expenses of separate counsel set
forth in Section 10, for purposes of this Section 11, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such claim or any action in respect thereof.
Notwithstanding the provisions of this Section 11, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Notes underwritten by it and distributed to the public were
offered to the public less the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to indemnify as
provided in Section 10 and contribute as provided in this Section 11 are several
in proportion to their respective underwriting obligations and not joint.
12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
----------------------------------------
shall inure to the benefit of and be binding upon the Underwriters, NFC, the
Seller, and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters, NFC and the Seller and their
respective successors and the controlling persons and officers and directors
referred to in Sections 10 and 11 and the ir heirs and legal representatives,
any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision contained herein.
13. EXPENSES. The Seller agrees with the Underwriters to pay
--------
(a) the costs incident to the authorization, issuance, sale, preparation and
delivery of the Notes and any taxes payable in that connection; (b) the costs
incident to the preparation, printing and filing under the Securities Act of the
Registration Statement and any amendments and exhibits thereto; (c) the costs of
printing, reproducing and distributing this Agreement, any other underwriting
and selling group documents and Term Sheet by mail, telex or other means of
communications; (d) the fees and expenses of qualifying the Notes under the
securities laws of the several jurisdictions as provided in Section 4(g) and of
preparing, printing and distributing Blue Sky Memoranda and Legal Investment
Surveys (including related fees and expenses of counsel to the Underwriters);
(e) any fees charged by S&P and Xxxxx'x for rating the Notes; (f) all fees and
expenses of the Owner Trustee and the Indenture Trustee and their respective
counsel; and (g) all other costs and expenses incident to the performance of the
obligations of the Seller under this Agreement; provided that, except as
otherwise provided in this Section 13 and in Section 9, the Underwriters shall
pay their own costs and expenses, including the costs and expenses of their
counsel, any transfer taxes on the Notes which they may sell, and the expenses
of (x) distributing the Prospectus to the Underwriters and the purchasers of the
Notes, (y) advertising any offering of the Notes made by the Underwriters and
(z) recording and broadcasting the Bloomberg road show relating to the Notes.
14. SURVIVAL. The respective indemnities, rights of
--------
contribution, representations, warranties and agreements of NFC, the Seller and
the Underwriters contained in this Agreement or made by or on behalf on them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Notes and shall remain in full force and effect, regardless of
any (i) termination or cancellation of this Agreement, (ii) any investigation
made
15
by or on behalf of any of them or any person controlling any of them or
(iii) acceptance of and payment for the Notes.
15. NOTICES, ETC. All statements, requests, notices and
------------
agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail
or facsimile transmission and confirmed to Banc of America Securities
LLC, 000 Xxxxx XxXxxxx Xxxxxx Xxxxxxx, Xxxxxxxx 00000, xxxxxxxxx number
(000) 000-0000 Attention: Xxxxxxx Xxxxxxx, with a copy to the Legal
Department;
(b) if to the Seller, shall be delivered or sent by mail or
facsimile transmission and confirmed to the address of the Seller set
forth in the Registration Statement, Attention: General Counsel, with a
copy to NFC at the address of the Servicer set forth in the
Registration Statement, Attention: General Counsel;
provided, however, that any notice to an Underwriter pursuant to Section 10(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representative, which address will be supplied to any other party hereto by the
Representative upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Seller shall be
entitled to act and rely upon any request, consent, notice or agreement given or
made on behalf of the Underwriters by the Representative.
16. DEFINITIONS OF CERTAIN TERMS. For purposes of this
----------------------------
Agreement, "business day" means any day on which the New York Stock Exchange,
Inc. is open for trading.
17. GOVERNING LAW. THIS AGREEMENT SHALL BE
-------------
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
18. COUNTERPARTS. This Agreement may be executed in any
------------
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same instrument.
19. HEADINGS. The headings herein are inserted for
--------
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
16
If the foregoing is in accordance with your understanding of
the agreement between the Seller and NFC and the several Underwriters, kindly
indicate your acceptance in the space provided for that purpose below.
Very truly yours,
NAVISTAR FINANCIAL RETAIL
RECEIVABLES CORPORATION
By /s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
Name:
Title:
NAVISTAR FINANCIAL CORPORATION
By /s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
Name:
Title:
Accepted:
BANC OF AMERICA SECURITIES LLC,
for itself and as representative of the several
Underwriters
By /s/ Xxxxxxx Xxxxxxx
---------------------------------
Name:
Title:
SCHEDULE I
----------
UNDERWRITERS
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Banc of America Banc One Capital Xxxxxxx Xxxxx
Principal Amount Securities LLC Markets, Inc. Barney
------------------------------------------------------------------------------------------
Class A-1 Notes $ 26,546,000 $ 26,546,000 $ 26,546,000
------------------------------------------------------------------------------------------
Class A-2 Notes $ 43,905,000 $ 43,905,000 $ 43,905,000
------------------------------------------------------------------------------------------
Class A-3 Notes $ 59,668,000 $ 59,666,000 $ 59,666,000
------------------------------------------------------------------------------------------
Class A-4 Notes $ 30,299,000 $ 30,299,000 $ 30,299,000
------------------------------------------------------------------------------------------
Class B Notes $ 18,750,000 $ 0 $ 0
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