EXHIBIT 4.5
NAVISTAR INTERNATIONAL CORPORATION
$100,000,000
7% Senior Notes due 2003
Purchase Agreement
January 30, 1998
X.X. XXXXXX SECURITIES INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
CHASE SECURITIES INC.
c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Navistar International Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell to X.X. Xxxxxx Securities Inc., Credit Suisse First
Boston Corporation and Chase Securities Inc. (the "Initial Purchasers")
$100,000,000 aggregate principal amount of its 7% Senior Notes due 2003 (the
"Securities"). The Securities will be issued pursuant to the provisions of an
Indenture to be dated as of February 4, 1998 (the "Indenture") by and between
the Company and Xxxxxx Trust and Savings Bank as Trustee (the "Trustee").
The sale of the Securities to the Initial Purchasers will be made without
registration of the Securities under the Securities Act of 1933, as amended, and
the rules and regulations thereunder (collectively, the "Securities Act"), in
reliance upon the exemption therefrom provided by Section 4(2) of the Securities
Act. Holders of the Securities will have the benefits of a Registration Rights
Agreement to be dated as of February 4, 1998 among the Company and the Initial
Purchasers (the "Registration Rights Agreement").
The Company hereby agrees with the Initial Purchasers as follows:
1. The Company hereby agrees, upon the basis of your representations and
warranties contained in Section 2 hereof, to issue and sell the Securities to
the several Initial
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Purchasers as hereinafter provided, and each Initial Purchaser, upon the basis
of the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees to purchase, severally and not jointly,
from the Company the respective principal amount of Securities set forth
opposite such Initial Purchaser's name in Schedule I hereto at a price equal to
98.5429% of their principal amount (the "Purchase Price") plus accrued interest,
if any, from February 4, 1998.
2. The Company understands that the Initial Purchasers intend (x) to offer
privately the Securities as soon after this Agreement has become effective as in
the judgment of the Initial Purchasers is advisable and (y) initially to offer
the Securities upon the terms set forth in the Offering Memorandum (as defined
below).
The Company confirms that it has authorized the Initial Purchasers, subject
to the restrictions set forth below, to distribute copies of the Offering
Memorandum in connection with the offering of the Securities. Each Initial
Purchaser hereby makes to the Company the following representations, warranties
and covenants:
(i) it is a qualified institutional buyer within the meaning of
Rule 144A under the Securities Act; and
(ii) (A) it will not solicit offers for, or offer to sell, the
Securities by any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Securities Act) and (B) it
will solicit offers for the Securities only from, and will offer the
Securities only to, (1) persons whom it reasonably believes to be
"qualified institutional buyers" within the meaning of Rule 144A under the
Securities Act or (2) upon the terms and conditions set forth in Annex I to
this Agreement.
3. Payment for the Securities shall be made to the Company by wire
transfer in immediately available funds, to the account specified by the Company
to the Initial Purchasers at a bank reasonably acceptable to the Initial
Purchasers no later than noon the Business Day (as defined below) prior to the
Closing Date (as defined below), on February 4, 1998 or at such other time on
the same or such other date, not later than the fifth Business Day thereafter,
as the Initial Purchasers and the Company may agree upon in writing. The time
and date of such payment for the Securities are referred to herein as the
"Closing Date." As used herein, the term "Business Day" means any day other than
a day on which banks are permitted or required to be closed in New York City.
Payment for the Securities shall be made against delivery to the nominee of
The Depository Trust Company for the account of the Initial Purchasers of one or
more global notes representing such Securities (collectively, the "Global
Notes"), with any transfer taxes
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payable in connection with the transfer to the Initial Purchasers of the
Securities duly paid by the Company. The Global Notes will be made available for
inspection by the Initial Purchasers at the office of X.X. Xxxxxx Securities
Inc. at the address set forth above not later than 1:00 P.M., New York City
time, on the Business Day prior to the Closing Date.
4. The Company represents and warrants to each of the Initial Purchasers
that:
(a) A preliminary offering memorandum, dated January 22, 1998 (the
"Preliminary Offering Memorandum") and an offering memorandum, dated
January 30, 1998 (the "Offering Memorandum") have been prepared in
connection with the offering of the Securities. The Preliminary Offering
Memorandum or the Offering Memorandum and any amendments or supplements
thereto did not and will not, as of their respective dates, contain an
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, provided that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information relating
to any Initial Purchaser furnished to the Company in writing by such
Initial Purchaser expressly for use therein;
(b) the audited financial statements, and the related notes thereto,
included in the Offering Memorandum present fairly the consolidated
financial position of the Company and its subsidiaries and the results of
their respective operations and the changes in their respective
consolidated cash flows, as of the dates and for the periods indicated, and
said financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved; the summary and selected financial and statistical data
included in the Offering Memorandum present fairly the information shown
therein and have been prepared and compiled on a basis consistent with the
audited and unaudited financial statements of the Company, except as
otherwise stated therein; and Deloitte & Touche LLP, who are reporting upon
the audited consolidated financial statements of the Company and its
consolidated subsidiaries (each a "Subsidiary," and collectively, the
"Subsidiaries"), and the related schedules included in the Offering
Memorandum, are independent public accountants as defined in the Securities
Act;
(c) the Company owns, directly or indirectly, free and clear of any
mortgage, pledge, security interest, lien, claim or other encumbrance or
restriction on transferability or voting (other than as may be imposed by
the Securities Act and the various state securities laws), all of the
outstanding capital stock of each Subsidiary of the Company; all of the
outstanding capital stock of each Subsidiary of the Com-
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pany has been duly authorized and validly issued and is fully paid and non-
assessable;
(d) since the respective dates as of which information is given in
the Offering Memorandum there has not been (A) any change in the Company's
issued capital stock, warrants or options except pursuant to the terms of
the instruments governing the same or pursuant to the exercise of such
options or warrants, or the issuance of certain options or (B) any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the general affairs, the management, business,
prospects, financial position, stockholder's equity or results of
operations, of the Company and the Subsidiaries, taken as a whole (a
"Material Adverse Change");
(e) since the respective dates as of which information is given in
the Offering Memorandum, except as disclosed therein, (i) there have been
no transactions entered into by the Company or by any of the Subsidiaries,
including those entered into in the ordinary course of business, which are
material to the Company and the Subsidiaries taken as a whole; and (ii)
there has been no dividend or distribution of any kind declared, paid or
made by the Company on any class of its capital stock, except for quarterly
dividends in accordance with the Company's past practice;
(f) the Company and each Subsidiary has been duly incorporated under
the laws of its jurisdiction of incorporation; the Company and each
Subsidiary is a validly existing corporation in good standing under the
laws of its jurisdiction of incorporation, with full power and corporate
authority to own, lease and operate its properties and conduct its business
as described in the Offering Memorandum, and is duly qualified as a foreign
corporation for the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or leases properties,
or conducts any business, so as to require such qualification, except where
the failure to be so qualified or in good standing would not reasonably be
expected to have a material adverse effect on the general affairs,
business, prospects, management, financial position, stockholder's equity
or results of operations of the Company and the Subsidiaries, taken as a
whole (a "Material Adverse Effect");
(g) this Agreement has been duly authorized, executed and delivered
by the Company;
(h) the Registration Rights Agreement has been duly authorized by the
Company, and when executed and delivered by the Company (assuming due
authorization, execution and delivery thereof by the Initial Purchasers),
the Registration Rights Agreement will constitute a legal, valid and
binding agreement of the
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Company enforceable against the Company in accordance with its terms,
except that the enforcement thereof may be subject to (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity and the discretion of the court before which
any proceeding therefor may be brought;
(i) the execution and delivery of the Indenture has been duly and
validly authorized by the Company and, when executed and delivered by the
Company (assuming due authorization, execution and delivery thereof by the
Trustee), the Indenture will constitute a legal, valid and binding
agreement of the Company enforceable against the Company in accordance with
its terms, except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity and the discretion of the court before which
any proceeding therefor may be brought; and the Securities and the
Indenture conform in all material respects to the descriptions thereof in
the Offering Memorandum;
(j) the Securities have been duly and validly authorized by the
Company for issuance and when executed by the Company and authenticated by
the Trustee in accordance with the provisions of the Indenture, and
delivered to and paid for by the Initial Purchasers in accordance with the
terms hereof, will have been duly executed, authenticated, issued and
delivered and will constitute legal, valid and binding obligations of the
Company entitled to the benefits provided by the Indenture and enforceable
against the Company in accordance with their terms, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of
equity and the discretion of the court before which any proceeding therefor
may be brought;
(k) the execution and delivery by the Company of, and the performance
by the Company of all of the provisions of its obligations under, this
Agreement, the Indenture, the Registration Rights Agreement, the Securities
and the consummation by the Company of the transactions herein and therein
contemplated and as set forth in the Offering Memorandum, (i) have been
duly authorized by all necessary corporate action on the part of the
Company, (ii) do not and will not result in any violation of the
Certificate of Incorporation or the By-laws of the Company and (iii) do not
and will not conflict with, or result in a breach or violation of any of
the terms or provisions of, or constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default) under,
or give rise to any right to accelerate the maturity or require the
prepayment of any indebtedness or the purchase of
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any capital stock under, or result in the creation or imposition of any
lien, charge or encumbrance upon any properties or assets of the Company or
of any Subsidiary under, (A) any contract, indenture, mortgage, deed of
trust, loan agreement, note, lease, partnership agreement or other
agreement or instrument to which the Company or any such Subsidiary is a
party or by which any of them may be bound or to which any of their
respective properties or assets may be subject, (B) (assuming compliance
with the Securities Act with respect to the exchange of the Securities for
the Exchange Securities (as defined in the Registration Rights Agreement)
and the other obligations of the Company under the Registration Rights
Agreement) any applicable law or statute, rule or regulation (other than
the securities or Blue Sky laws of the various states of the United States
of America) or (C) any judgment, order or decree of any government,
governmental instrumentality, agency, body or court, domestic or foreign,
having jurisdiction over the Company or any such Subsidiary or any of their
respective properties or assets, except, with respect to clause (iii), any
violation, conflict, or breach which would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect;
(l) neither the Company nor any agent acting on its behalf has taken
or will take any action that will cause this Agreement or the sale,
issuance, execution or delivery of the Securities to violate Regulation G,
T, U or X of the Board of Governors of the Federal Reserve System, in each
case as in effect, or as the same may hereafter be in effect, on the
Closing Date;
(m) the Company and each Subsidiary has good and marketable title to
all real and personal property described in the Offering Memorandum as
being owned by it and good and marketable title to a leasehold estate in
the real and personal property described therein as being leased by it,
free and clear of all liens, charges, encumbrances or restrictions, except,
in each case, as described in the Offering Memorandum or to the extent the
failure to have such title or the existence of such liens, charges,
encumbrances or restrictions would not reasonably be expected to have a
Material Adverse Effect;
(n) no authorization, approval, consent, order, registration,
qualification or license of, or filing with, any government, governmental
instrumentality, agency, body or court, domestic or foreign or third party
(other than as have been or will be prior to the Closing Date obtained
under the securities or Blue Sky laws of the various states of the United
States of America and assuming compliance with the Securities Act with
respect to the exchange of the Securities for the Exchange Securities and
the other obligations of the Company under the Registration Rights
Agreement), is required for the valid authorization, issuance, sale and
delivery of the Securities, or the performance by the Company of all of its
obligations under this Agreement,
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the Indenture, the Registration Rights Agreement or the Securities, or the
consummation by the Company of the transactions contemplated by this
Agreement, the Indenture, the Registration Rights Agreement or the Offering
Memorandum, except where the failure to obtain such authorization,
approval, consent, order, registration, qualification or license or to make
any such filing would not reasonably be expected, individually or in the
aggregate, to have a material adverse effect on the consummation of the
transactions contemplated in, or the fulfillment of the terms of, this
Agreement, the Offering Memorandum, the Indenture or the Registration
Rights Agreement;
(o) neither the Company nor any of the Subsidiaries (i) is in
violation of its Certificate of Incorporation or By-Laws or (ii) is in
breach or violation of any of the terms or provisions of, or with the
giving of notice or lapse of time, or both, would be in default under, any
contract, indenture, mortgage, deed of trust, loan agreement, note, lease,
partnership agreement, or other agreement or instrument to which the
Company or any Subsidiary is a party or by which any of them may be bound
or to which any of their properties or assets may be subject, except for
such violations or defaults that would not reasonably be expected to have a
Material Adverse Effect;
(p) except as described in the Offering Memorandum, there is no
action, suit or proceeding before or by any government, governmental
instrumentality, agency, body or court, domestic or foreign, now pending
or, to the best knowledge of the Company after due inquiry, threatened
against or affecting the Company or any of the Subsidiaries that could
reasonably be expected to have a Material Adverse Effect or that could
reasonably be expected to have a material adverse effect on the
consummation of the transactions contemplated in, or the fulfillment of the
terms of, this Agreement, the Offering Memorandum, the Indenture or the
Registration Rights Agreement; there is no action, suit or proceeding
before or by any government, governmental instrumentality, agency, body or
court, now pending, or to the best knowledge of the Company, threatened
against or affecting the Company or any of the Subsidiaries that would be
required to be described in a registration statement pursuant to Item 103
of Regulation S-K filed pursuant to the Securities Act that is not
described in the Offering Memorandum;
(q) each of the Company and the Subsidiaries owns, possesses or has
obtained all material licenses, permits, certificates, consents, orders,
approvals and other authorizations from, and has made all material
declarations and filings with, all federal, state, local and other
governmental authorities (including foreign regulatory agencies) and all
courts and other tribunals, domestic or foreign, necessary to own or lease,
as the case may be, and to operate its properties and to carry on its
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business as conducted as of the date hereof, except in each case where the
failure to obtain licenses, permits, certificates, consents, orders,
approvals and other authorizations, or to make all declarations and
filings, would not reasonably be expected to have a Material Adverse
Effect, and none of the Company or any of the Subsidiaries has received any
notice of any proceeding relating to revocation or modification of any such
license, permit, certificate, consent, order, approval or other
authorization, except as described in the Offering Memorandum and except,
in each case, where such revocation or modification would not reasonably be
expected to have a Material Adverse Effect; and the Company and each of the
Subsidiaries are in material compliance with all laws and regulations
relating to the conduct of their respective businesses as conducted as of
the date hereof, except where noncompliance with such laws or regulations
would not reasonably be expected to have a Material Adverse Effect;
(r) neither the Company nor any affiliate (as defined in Rule 501(b)
of Regulation D under the Securities Act ("Regulation D")) of the Company
has directly, or through any agent, sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the sale
of the Securities in a manner that would require the registration under the
Securities Act of the offering contemplated by the Offering Memorandum;
(s) neither the Company nor, to the best of the Company's knowledge,
any person acting on its behalf has offered or sold the Securities by means
of any general solicitation or general advertising within the meaning of
Rule 502(c) under the Securities Act or, with respect to Securities sold
outside the United States to non-U.S. persons (as defined in Rule 902 under
the Securities Act), by means of any directed selling efforts within the
meaning of Rule 902 under the Securities Act and the Company and any of its
affiliates and any person acting on their behalf has complied with and will
implement the "offering restriction" within the meaning of such Rule 902;
(t) it is not necessary in connection with the offer, sale and
delivery of the Securities in the manner contemplated by this Agreement to
register the Securities under the Securities Act or to qualify an indenture
under the TIA; and
(u) the Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act.
5. The Company covenants and agrees with each Initial Purchaser as
follows:
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(a) before distributing any amendment or supplement to the Offering
Memorandum, to furnish to the Initial Purchasers a copy of the proposed
amendment or supplement for review and not to distribute any such proposed
amendment or supplement to which the Initial Purchasers reasonably object;
(b) if, at any time prior to the completion of the initial placement
of the Securities, any event shall occur as a result of which it is
necessary to amend or supplement the Offering Memorandum in order that the
Offering Memorandum does not contain an 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 at the time the Offering
Memorandum is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Offering Memorandum to comply with
law, forthwith to prepare and furnish, at the sole expense of the Company,
to the Initial Purchasers and to the dealers (whose names and addresses the
Initial Purchasers will furnish to the Company) to which Securities may
have been sold by the Initial Purchasers on behalf of the Initial
Purchasers and to any other dealers upon request, such amendments or
supplements to the Offering Memorandum as may be necessary so that the
Offering Memorandum as so amended or supplemented will not contain an
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 at the time the Offering Memorandum is delivered to a
purchaser, not misleading or so that the Offering Memorandum will comply
with law;
(c) to use its best efforts (i) to register or qualify the Securities
for offering and sale by the Initial Purchasers and by dealers under the
securities or Blue Sky laws of such jurisdictions as the Initial Purchasers
shall reasonably request and to continue such qualifications in effect so
long as reasonably required for distribution of the Securities and (ii) to
pay all fees and expenses (including reasonable fees and disbursements of
counsel for the Initial Purchasers) incurred in connection with the
determination of the eligibility of the Securities for investment under the
laws of such jurisdictions as the Initial Purchasers may designate;
provided that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take
any action that would subject it to taxation or service of process in
suits, other than those arising out of the offering or sale of the
Securities, in any jurisdiction where it is not now so subject;
(d) so long as the Securities are outstanding, to furnish to the
Initial Purchasers copies of all reports or other communications (financial
or other) required to be furnished to holders of the Securities, and copies
of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange;
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(e) during the period beginning on the date hereof and continuing to
and including the Business Day following the Closing Date, not to offer,
sell, contract to sell, or otherwise dispose of any debt securities of or
guaranteed by the Company which are substantially similar to the Securities
except as otherwise contemplated by the Offering Memorandum;
(f) to use the net proceeds of the offering of Securities as set
forth in the Offering Memorandum under the caption "Use of Proceeds";
(g) if requested by you, to use its best efforts to cause such
Securities to be eligible for trading in the PORTALSM Market ("PORTAL") of
the Nasdaq Stock Market, Inc.;
(h) to furnish to the registered holders of the Securities within a
reasonable period of time after such information is filed with the
Commission an annual report (including a balance sheet and statements of
income, stockholder's equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and,
as soon as reasonably practicable after such information is filed with the
Commission with respect to the first three quarters of each fiscal year
(beginning with the fiscal quarter ending after the date of the Offering
Memorandum), consolidated summary financial information of the Company and
its subsidiaries of such quarter in reasonable detail;
(i) during the period of two years after the Closing Date, not to,
and not to permit any of its "affiliates" (as defined in Rule 144 under the
Securities Act) to, resell any of the Securities which constitute
"restricted securities" under Rule 144 that have been reacquired by any of
them;
(j) to pay all costs and expenses incident to the performance of its
obligations hereunder, including without limiting the generality of the
foregoing, all costs and expenses (i) incident to the preparation,
issuance, execution, authentication and delivery of the Securities,
(including any reasonable expenses of the Trustee and the Trustee's
counsel), (ii) incident to the preparation and printing of the Offering
Memorandum and any preliminary offering memorandum (including in each case
all exhibits, amendments and supplements thereto), (iii) incurred in
connection with the registration or qualification of the Securities under
the laws of such jurisdictions as the Initial Purchasers may designate
(including fees and disbursements of Xxxxxx Xxxxxx & Xxxxxxx, counsel for
the Initial Purchasers, in connection with such registration or
qualification (not to exceed $10,000)), (iv) in connection with the
printing (including word processing and duplication costs) and delivery of
this Agreement, the Indenture and the Registration Rights Agreement,
including mailing and
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shipping, as herein provided, (v) payable to rating agencies in connection
with the rating of the Securities and (vi) qualifying the Securities for
trading in PORTAL;
(k) to take all reasonable action that is appropriate or necessary to
assure that its offerings of other securities will not be integrated for
purposes of the Securities Act with the offerings contemplated hereby;
(l) not to solicit any offer to buy or offer to sell Securities by
means of any form of general solicitation or general advertising within the
meaning of Rule 502(c) of Regulation D under the Securities Act;
(m) while the Securities remain outstanding and are "restricted
securities" within the meaning of Rule 144(a)(3) under the Securities Act,
during any period in which it is not subject to Section 13 or 15(d) under
the Exchange Act, to make available to the Initial Purchasers and any
holder of Securities in connection with any sale thereof and any
prospective purchaser of Securities, in each case upon request and within a
reasonable time period, the information specified in, and meeting the
requirements of, Rule 144A(d)(4) ("Rule 144A(d)(4) Information") under the
Securities Act (or any successor thereto);
(n) not to take any action prohibited by Regulation M under the
Exchange Act (or any successor provision), in connection with the
distribution of the Securities contemplated hereby;
(o) during the period of two years after the Closing Date, the
Company will, upon request, furnish to each of the Initial Purchasers and
any holder of Securities a copy of the restrictions on transfer applicable
to the Securities; and
(p) during the period of two years after the Closing Date, the
Company will not be or become an open-end investment company, unit
investment trust or face-amount certificate company that is or is required
to be registered under Section 8 of the Investment Company Act.
6. The several obligations of the Initial Purchasers hereunder to
purchase the Securities on the Closing Date are subject to the performance by
the Company of its obligations hereunder and to the following additional
conditions:
(a) each of the representations and warranties of the Company
contained herein shall be true and correct on and as of the Closing Date as
if made on and as of the Closing Date and the Company shall have complied,
in all material respects,
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with all agreements and all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date;
(b) subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any downgrading,
nor shall any notice have been given of (i) any intended or potential
downgrading or (ii) any review or possible change that does not indicate an
improvement, in the rating accorded any securities of or guaranteed by the
Company by any "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the Securities
Act;
(c) since the respective dates as of which information is given in
the Offering Memorandum there shall not have been any Material Adverse
Change, otherwise than as set forth in the Offering Memorandum, the effect
of which in the sole judgment of the Initial Purchasers makes it
impracticable or inadvisable to proceed with the offering or the delivery
of the Securities on the terms and in the manner contemplated in the
Offering Memorandum;
(d) the Initial Purchasers shall have received on and as of the
Closing Date a certificate, addressed to the Initial Purchasers and dated
the Closing Date, of an executive officer of the Company satisfactory to
the Initial Purchasers to the effect set forth in subsections (a) through
(c) of this Section and to the further effect that since the respective
dates as of which information is given in the Offering Memorandum there has
not occurred any Material Adverse Change, otherwise than as set forth in
the Offering Memorandum, provided that the officer making such certificate
may rely upon his knowledge as to pending or threatened proceedings;
(e) the Initial Purchasers shall have received on the Closing Date a
signed opinion of Xxxxxxxx & Xxxxx, special counsel for the Company, in
form and substance satisfactory to Xxxxxx Xxxxxx & Xxxxxxx, counsel to the
Initial Purchasers, dated the Closing Date and addressed to the Initial
Purchasers, to the effect as set forth in Annex III hereto.
(f) the Initial Purchasers shall have received on the Closing Date a
signed opinion of Xxxxxx Xxxxxxxx, General Counsel of the Company, in form
and substance satisfactory to Xxxxxx Xxxxxx & Xxxxxxx, counsel to the
Initial Purchasers, dated the Closing Date and addressed to the Initial
Purchasers to the effect that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware with full power and authority (corporate and other) to
own, lease and operate
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its properties and to conduct its business as described in the
Offering Memorandum;
(ii) the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing in
each jurisdiction in which it owns or leases properties, or conducts
business, so as to require such qualification, except where the
failure to be in good standing would not reasonably be expected to
have a Material Adverse Effect;
(iii) each Subsidiary has been duly incorporated and is validly
existing as a corporation under the laws of its jurisdiction of
incorporation with power and authority (corporate and other) to own,
lease and operate its properties and to conduct its business, and has
been duly qualified as a foreign corporation for the transaction of
business and is in good standing in each jurisdiction in which it owns
or leases properties, or conducts business, so as to require such
qualification, except where the failure to be in good standing would
not reasonably be expected to have a Material Adverse Effect;
(iv) the authorized capital stock of the Company is as set
forth in the Offering Memorandum;
(v) all the outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued and are fully
paid and non-assessable, and, except as otherwise set forth in the
Offering Memorandum, are directly or indirectly owned by the Company
free and clear of any mortgage, pledge, security interest, lien, claim
or other encumbrance or restriction on transferability or voting
(other than as may be imposed by the Securities Act and the various
state securities laws);
(vi) all of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are fully
paid and non-assessable;
(vii) except as described in the Offering Memorandum, there is
no action, suit or proceeding before or by any government,
governmental instrumentality, agency, body or court, domestic or
foreign, now pending or, to the best knowledge of such counsel after
reasonable investigation, threatened against or affecting the Company
or any of the Subsidiaries that could reasonably be expected to have a
Material Adverse Effect or that could reasonably be expected to have a
material adverse effect on the consummation of the transactions
contemplated in, or the fulfillment of the terms of, this
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Agreement, the Offering Memorandum, the Indenture or the Registration
Rights Agreement; there is no action, suit or proceeding before or by
any government, governmental instrumentality, agency, body or court,
now pending, or to the best knowledge of such counsel after reasonable
investigation, threatened against or affecting the Company or any
Subsidiary that would be required to be described in a registration
statement filed pursuant to the Securities Act that is not described
in the Offering Memorandum; and
(viii) the execution and delivery by the Company of, and the
performance by the Company of all of the provisions of its obligations
under, this Agreement, the Indenture, the Registration Rights
Agreement, the Securities, and the consummation by the Company of the
transactions contemplated therein and in the Offering Memorandum, do
not and will not conflict with, or result in a breach or violation of
any of the terms or provisions of, or constitute a default (or an
event which, with notice or lapse of time, or both, would constitute a
default) under, or give rise to any right to accelerate the maturity
or require the prepayment of any indebtedness or the purchase of any
capital stock under, or result in the creation or imposition of any
lien, charge or encumbrance upon any material properties or assets of
the Company or of any Subsidiary under, (A) any material contract,
indenture, mortgage, deed of trust, loan agreement note, lease,
partnership agreement or other agreement or instrument known to such
counsel after reasonable investigation to which the Company or any
Subsidiary is a party or by which any of them may be bound or to which
any of their respective properties or assets may be subject or (B) any
judgment, order or decree of any government, governmental
instrumentality, agency, body or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of their
respective properties or assets known to such counsel after reasonable
investigation except, with respect to clauses (A) and (B), any breach
or violation that would not reasonably be expected to have a Material
Adverse Effect.
Such counsel shall also advise, based on its participation in the
preparation of the Offering Memorandum and conferences with officers and
representatives of the Company, representatives of the independent public
accountants for the Company, representatives of the Initial Purchasers and
counsel to the Initial Purchasers, that nothing has come to its attention that
leads it to believe that the Offering Memorandum (as supplemented, if
applicable) (other than the financial statements, supporting schedules and other
financial and statistical data set forth therein, as to which no advice need be
given), as of its date or as of the Closing Date, contained or contains an
untrue statement of a material fact or omitted or
-15-
omits 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.
(g) on the date of the issuance of the Offering Memorandum and also
on the Closing Date, Deloitte & Touche shall have furnished to the Initial
Purchasers letters, dated the respective dates of delivery thereof, in form
and substance satisfactory to the Initial Purchasers, containing statements
and information of the type customarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information relating to the Company contained in the
Offering Memorandum;
(h) the Company shall have executed and delivered the Registration
Rights Agreement substantially in the form attached hereto as Annex II;
(i) the Initial Purchasers shall have received on and as of the
Closing Date an opinion of Xxxxxx Xxxxxx & Xxxxxxx, counsel to the Initial
Purchasers, with respect to the validity of the Indenture and the
Securities, and such other related matters as the Initial Purchasers may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(j) the Initial Purchasers shall have received on and as of the
Closing Date a certificate dated the Closing Date and addressed to the
Initial Purchasers signed by the Executive Vice President - Chief Financial
Officer, Vice President and Treasurer of the Company or the Vice President
and Controller to the effect that neither the Company nor any of its
Subsidiaries is in breach or violation of any of the terms or provisions
of, or with the giving of notice or lapse of time, or both, would be in
default under any contract, indenture, mortgage, deed of trust, loan
agreement, note, lease, partnership agreement, or other agreement or
instrument to which the Company or any Subsidiary is a party or by which
any of them may be bound or to which any of their respective properties or
assets may be subject, except for any such breach or violation which would
not have a Material Adverse Effect;
(k) on or prior to the Closing Date the Company shall have furnished
to the Initial Purchasers such further certificates and documents as the
Initial Purchasers or their counsel, Xxxxxx Xxxxxx & Xxxxxxx, shall
reasonably request; and
(l) on or prior to the Closing Date the Company shall have furnished
to the Initial Purchasers a duly executed waiver and amendment to the
Mexico Credit Agreement (as defined in the Offering Memorandum) in form and
substance satisfactory to them.
-16-
7. The Company agrees to indemnify and hold harmless each Initial
Purchaser, its officers and directors, and each person, if any, who controls any
Initial Purchaser within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, the reasonable legal
fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Offering Memorandum (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary offering memorandum or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading except insofar as such
losses, claims, damages or liabilities are caused by any untrue statement or
omission or alleged untrue statement or omission (i) made in reliance upon and
in conformity with information relating to the Initial Purchasers furnished to
the Company in writing by the Initial Purchasers expressly for use therein or
(ii) contained in the Preliminary Offering Memorandum if any Initial Purchaser
failed to send or deliver a copy of the Offering Memorandum to a U.S. person (as
defined in Regulation S) and who asserts such losses, claims, damages or
liabilities on or prior to the delivery of written confirmation of sale of the
Securities to such person and such Offering Memorandum would have corrected such
untrue statement or omission and it shall have been determined that such losses,
claims, damages or liabilities would not have arisen had the Offering Memorandum
been delivered or sent.
Each Initial Purchaser agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors and officers and each person who
controls the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the foregoing indemnity
from the Company to each Initial Purchaser, but only with reference to
information relating to such Initial Purchaser furnished to the Company in
writing by such Initial Purchaser expressly for use in the Offering Memorandum,
any amendment or supplement thereto, or any preliminary offering memorandum.
For purposes of this Section 7 and paragraphs (a) and (b) of Section 4 hereof,
the only written information furnished by the Initial Purchasers to the Company
expressly for use in the Offering Memorandum is the information in the last
paragraph of the cover page of the Offering Memorandum, the fourth paragraph on
page 2 of the Offering Memorandum and the first, third, fifth, eighth and ninth
paragraphs under the caption in the "Plan of Distribution" section of the
Offering Memorandum.
If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person
-17-
(the "Indemnified Person") shall promptly notify the person against whom such
indemnity may be sought (the "Indemnifying Person") in writing, and the
Indemnifying Person, upon request of the Indemnified Person, shall retain
counsel satisfactory to the Indemnified Person to represent the Indemnified
Person and any others the Indemnifying Person may designate in such proceeding
and shall pay the fees and expenses of such counsel related to such proceeding.
In any such proceeding, any Indemnified Person shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Person unless (i) the Indemnifying Person and the
Indemnified Person shall have mutually agreed to the contrary, (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
satisfactory to the Indemnified Person or (iii) the named parties in any such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them. It is understood that the Indemnifying Person shall not, in
connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the reasonable fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such reasonable fees and expenses shall be reimbursed as they are incurred. Any
such separate firm for the Initial Purchasers and such control persons of
Initial Purchasers shall be designated in writing by X.X. Xxxxxx Securities Inc.
and any such separate firm for the Company, its directors and officers and such
control persons of the Company shall be designated in writing by the Company.
The Indemnifying Person shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested an Indemnifying Person
to reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by the third sentence of this paragraph, the Indemnifying Person
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 60
days after receipt by such Indemnifying Person of the aforesaid request and (ii)
such Indemnifying Person shall not have reimbursed the Indemnified Person in
accordance with such request prior to the date of such settlement (or delivered
a notice to such Indemnified Person setting forth its good faith objection to
such request's conformity to the provisions of this Section 7). No Indemnifying
Person shall, without the prior written consent of the Indemnified Person,
effect any settlement of any pending or threatened proceeding in respect of
which any Indemnified Person is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Person, unless such settlement
includes an unconditional written release, in form and substance reasonably
satisfactory to the Indemnified Person, of such Indemnified Person from all
liability on claims that are the subject matter of such proceeding.
-18-
If the indemnification provided for in the first and second paragraphs of
this Section 7 is for any reason unavailable to, or insufficient to hold
harmless, an Indemnified Person in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such
paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall
contribute to the amount paid or payable by such Indemnified Person as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Initial Purchasers on the other hand from the offering of the
Securities 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 the Company on the one hand and the Initial Purchasers on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Initial Purchasers on the other shall be deemed to be in the same
respective proportions as the net proceeds from the offering (before deducting
expenses) received by the Company and the total discounts and the commissions
actually received by the Initial Purchasers, in each case as set forth in the
table on the cover of the Offering Memorandum, bear to the aggregate offering
price of the Securities. The relative fault of the Company on the one hand and
the Initial Purchasers on the other 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 the Company or by the Initial Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and the Initial Purchasers agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall an Initial
Purchaser be required to contribute any amount in excess of the amount by which
the total price at which the Securities purchased by it were offered exceeds the
amount of any damages that such Initial Purchaser has otherwise been required to
pay or has paid by reason of such 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
-19-
guilty of such fraudulent misrepresentation. The Initial Purchasers' obligations
to contribute pursuant to this Section 7 are several in proportion to the
respective principal amounts of Securities set forth opposite their names in
Schedule I hereto, and not joint.
The indemnity and contribution agreements contained in this Section 7 are
in addition to any liability which the Indemnifying Persons may otherwise have
to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this Section 7 and
the representations and warranties of the Company as set forth in this Agreement
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Initial Purchaser or any person controlling any Initial Purchaser or by or
on behalf of the Company, its officers or directors or any other person
controlling the Company and (iii) acceptance of and payment for any of the
Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Initial Purchasers, by notice given
to the Company, if after the execution and delivery of this Agreement and prior
to the Closing Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange or the National Association of Securities
Dealers, Inc., (ii) trading of any securities of or guaranteed by the Company
shall have been suspended on any exchange or in any over-the-counter market,
(iii) a general moratorium on commercial banking activities in New York shall
have been declared by either Federal or New York State authorities or (iv) there
shall have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the judgment of the Initial
Purchasers, is material and adverse and which, in the judgment of the Initial
Purchasers, makes it impracticable or inadvisable to market the Securities on
the terms and in the manner contemplated in the Offering Memorandum.
9. This Agreement shall become effective upon the execution and delivery
hereof by the parties hereto.
10. If this Agreement shall be terminated by the Initial Purchasers
because of any failure or refusal on the part of the Company to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason the Company shall be unable to perform its obligations under this
Agreement, the Company agrees to reimburse the Initial Purchasers for all
out-of-pocket expenses (including the reasonable fees and expenses of their
counsel) reasonably incurred by the Initial Purchasers in connection with this
Agreement or the offering contemplated hereunder. The Company shall not be
obligated to reimburse the Initial Purchasers for any out-of-pocket expenses
reasonably incurred by the Ini-
-20-
tial Purchasers if this Agreement is terminated by the Initial Purchasers
pursuant to Section 8(i), (iii) and (iv) hereof.
11. This Agreement shall inure to the benefit of and be binding upon the
Initial Purchasers and the Company, any controlling person referred to herein
and their respective successors, heirs and legal representatives. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Initial Purchasers and the
Company and their respective successors, heirs and legal representatives and the
controlling persons and officers and directors referred to in Section 7 and
their heirs and legal representatives, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision herein contained.
No purchaser of Securities from any Initial Purchaser shall be deemed to be a
successor merely by reason of such purchase.
12. Any action by the Initial Purchasers hereunder may be taken by the
Initial Purchasers jointly or by X.X. Xxxxxx Securities Inc. alone or on behalf
of the Initial Purchasers, and any such action taken by X.X. Xxxxxx Securities
Inc. alone shall be binding upon the Initial Purchasers. All notices and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if mailed or transmitted by any standard form of telecommunication.
Notices to the Initial Purchasers shall be given to them at the following
address: X.X. Xxxxxx Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000;
Attention: Syndicate Department. Notices to the Company shall be given to it at
000 Xxxxx Xxxxxxxxx Xxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000; Attention: Vice
President and Treasurer (facsimile (000) 000-0000) with a copy to the Company's
General Counsel at the same address.
13. This Agreement may be signed in counterparts, each of which shall be
an original (or a facsimile copy thereof) and all of which together shall
constitute one and the same instrument.
14. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF
LAWS PROVISIONS THEREOF.
S-1
If the foregoing is in accordance with your understanding, please sign and
return four counterparts hereof.
Very truly yours,
NAVISTAR INTERNATIONAL
CORPORATION
By: /s/ Xxxxxx X. Xxxxx
------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President & Treasurer
Accepted: January 30, 1998
X.X. XXXXXX SECURITIES INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
CHASE SECURITIES INC.
By: X.X. Xxxxxx Securities Inc.
By: /s/ Xxxxxxx X. Xxxxxxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
ANNEX I
(A) In addition to offers pursuant to clause (B)(1) of paragraph 2(ii) of
the Agreement, the Initial Purchasers intend to offer and sell the Securities in
accordance with Regulation S under the Securities Act. Accordingly, each
Initial Purchaser agrees that neither it, its affiliates nor any persons acting
on its or their behalf has engaged or will engage in any directed selling
efforts with respect to the Securities and it and they have complied and will
comply with the offering restrictions requirement of Regulation S. Each Initial
Purchaser agrees that, at or prior to confirmation of sale of Securities (other
than a sale pursuant to and in accordance with paragraph 2(ii) of the Agreement
to purchasers described in clause (B)(1) thereof), it will have sent to each
distributor, dealer or person receiving a selling concession, fee or other
remuneration that purchases Securities from it during the restricted period a
confirmation or notice to substantially the following effect:
"The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933 (the "Act") and may not be offered and sold within
the United States or to, or for the account or benefit of, U.S. persons (i)
as part of their distribution at any time or (ii) otherwise until 40 days
after the later of the commencement of the offering and the closing date,
except in either case in accordance with Regulation S (or Rule 144A if
available) under the Act. Terms used above have the meaning given to them
by Regulation S."
Terms used in this paragraph have the meanings given to them by Regulation S.
Each of the Initial Purchasers further agrees that it has not entered and
will not enter into any contractual arrangement with respect to the distribution
or delivery of the Securities in accordance with this paragraph (A), except with
its affiliates or with the prior written consent of the Company.
(B) Each of the Initial Purchasers severally represents and agrees that
(i) it has not offered or sold and prior to the date six months after the date
of issue of the Securities will not offer or sell any Securities to persons in
the United Kingdom except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or agent)
for the purposes of their business or otherwise in circumstances which have not
resulted and will not result in an offer to the public in the United Kingdom
within the meaning of the Public Offers of Securities Regulations 1995, (ii) it
has complied, and will comply with all applicable provisions of the Financial
Services Xxx 0000 and any regulation promulgated thereto of Great Britain with
respect to anything done by it in relation to the Securities in, from or
otherwise involving the United Kingdom, and (iii) it has only issued or passed
on and will only issue or pass on in the United Kingdom any
AI-2
document received by it in connection with the issue of the Securities to a
person who is of a kind described in Article 11(3) of the Financial Services
Xxx 0000 (Investment Advertisements) (Exemptions) Order 1996 or is a person to
whom such document may otherwise lawfully be issued or passed on.
(C) Each of the Initial Purchasers agrees that it will not offer, sell or
deliver any of the Securities in any jurisdiction outside the United States
except under circumstances that will result in compliance with the applicable
laws thereof, and that it will take at its own expense whatever action is
required to permit its purchase and resale of the Securities in such
jurisdictions. Each of the Initial Purchasers understands that no action has
been taken to permit a public offering in any jurisdiction outside the United
States where action would be required for such purposes. Each of the Initial
Purchasers agrees not to cause any advertisement (other than an announcement of
the consummation of the offer and sale of the Securities) of the Securities to
be published in any newspaper or periodical or posted in any public place and
not to issue any circular relating to the Securities (other than the Offering
Memorandum).
ANNEX II
[Form of Registration Rights Agreement]
ANNEX III
[Form of Xxxxxxxx & Xxxxx Opinion]
SCHEDULE I
Principal Amount
of Securities
Initial Purchaser to be Purchased
----------------- ---------------
X.X. Xxxxxx Securities Inc.......................... $ 40,000,000
Credit Suisse First Boston Corporation 40,000,000
Chase Securities Inc................................ 20,000,000
------------
Total.......................................... $100,000,000
