[Draft--5/29/98]
EXHIBIT 1.2
Navistar International Corporation
4,000,000 Shares
Common Stock
($0.10 par value)
International Underwriting Agreement
New York, New York
[ ] , 1998
Xxxxx Xxxxxx Inc.
Credit Suisse First Boston
(Europe) Limited
X.X. Xxxxxx Securities Ltd.
As Lead Managers of the several Managers,
c/o Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Navistar International Transportation Corp. Retiree Supplemental
Benefit Trust (the "Selling Stockholder") proposes to sell to the several
underwriters named in Schedule I hereto (the "Managers"), for whom you (the
"Lead Managers") are acting as representatives, 4,000,000 shares of Class B
Common Stock, $0.10 par value (the "Class B Stock") of Navistar International
Corporation (the "Company"), a Delaware corporation, which as described herein
will convert into 4,000,000 shares of Common Stock, $0.10 par value per share
("Common Stock"), of the Company (such shares of Common Stock being hereinafter
called the "International Securities"). To the extent there are no additional
Managers listed on Schedule I other than you, the term Lead Managers as used
herein shall mean you, as Managers, and the terms Lead Managers and Managers
shall mean either the singular or plural as the context requires. The use of
the neuter in this Agreement shall include the feminine and masculine wherever
appropriate. Any reference herein to the Registration Statement, a Preliminary
Prospectus or the Prospectuses shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of such Preliminary Prospectus or the
Prospectuses, as the case may be; and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement, any
Preliminary Prospectus or the Prospectuses shall be deemed to refer to and
include the filing of any document under the Exchange Act after the Effective
Date of the Registration Statement, or the issue date of any Preliminary
Prospectus or the Prospectuses, as the case may be, deemed to be incorporated
therein by reference. Certain terms used herein are defined in Section 17
hereof.
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It is understood that the Company and the Selling Stockholder are
concurrently entering into a U.S. Underwriting Agreement dated the date hereof
(the "U.S. Underwriting Agreement") providing for the sale by the Selling
Stockholder of an aggregate of 15,894,103 shares of Common Stock (such shares to
be sold pursuant to the U.S. Underwriting Agreement being hereinafter called the
"U.S. Underwritten Securities"), in the United States and Canada through
arrangements with certain underwriters in the United States and Canada (the
"U.S. Underwriters" and, together with the Managers, the "Underwriters"), for
whom Xxxxx Xxxxxx Inc., Credit Suisse First Boston Corporation and X.X. Xxxxxx
Securities Inc. are acting as representatives (the "U.S. Representatives" and,
together with the Lead Managers, the "Representatives"). The U.S. Underwriting
Agreement also provides for the grant to the U.S. Underwriters of an option to
purchase from the Company up to 1,300,000 additional shares of Common Stock (the
"U.S. Option Securities"; the U.S. Option Securities, together with the U.S.
Underwritten Securities, being hereinafter called the "U.S. Securities", and the
U.S. Securities, together with the International Securities, being hereinafter
called the "Securities").
It is further understood and agreed that the U.S. Underwriters and the
Managers have entered into an Agreement Between U.S. Underwriters and Managers
dated the date hereof (the "Agreement Between U.S. Underwriters and Managers"),
pursuant to which, among other things, the Managers may purchase from the U.S.
Underwriters a portion of the Securities to be sold pursuant to the U.S.
Underwriting Agreement and the U.S. Underwriters may purchase from the Managers
a portion of the Securities to be sold pursuant to the International
Underwriting Agreement. The Company and the Selling Stockholder understand that
any such purchases and sales between the Managers and the U.S. Underwriters
shall be governed by the Agreement Between U.S. Underwriters and Managers and
shall not be governed by the terms of this Agreement or the U.S. Underwriting
Agreement.
In this Agreement, unless otherwise specified, all references to
"dollars" or "$" are to the currency of the United States.
1. Representations and Warranties.
(i) The Company represents and warrants to, and agrees with, each
Manager as set forth below in this Section 1.
(a) The Company meets the requirements for use of Form S-3 under the
Act and has prepared and filed with the Commission a registration statement
(file number 333-52375) on Form S-3, including related preliminary
prospectuses, for registration under the Act of the offering and sale of
the Securities. The Company may have filed one or more amendments thereto,
including a related preliminary prospectus, each of which has previously
been furnished to you. The Company will next file with the Commission one
of the following: either (1) prior to the Effective Date of such
registration statement, a further amendment to such registration statement
(including the forms of final prospectus) or (2) after the Effective Date
of such registration statement, a final prospectus in accordance with Rules
430A and 424(b). In the case of clause (2), the Company has included in
such registration statement, as amended at the Effective Date, all
information (other than Rule 430A Information) required by the Act and the
rules thereunder to be included in such registration statement and the
Prospectuses. As filed, such
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amendment and forms of final prospectus, or such final prospectuses, shall
contain all Rule 430A Information, together with all other such required
information, and, except to the extent the Lead Managers shall agree in
writing to a modification, shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the extent not
completed at the Execution Time, shall contain only such specific
additional information and other changes (beyond that contained in the
latest Preliminary Prospectus) as the Company has advised you, prior to the
Execution Time, will be included or made therein.
It is understood that two forms of prospectus are to be used in
connection with the offering and sale of the Securities: one form of
prospectus relating to the U.S. Securities, which are to be offered and
sold to United States and Canadian Persons which for purposes of
distribution to Canadian Persons shall have a Canadian "wrap-around" (the
"Canadian Offering Memorandum"), and one form of prospectus relating to the
International Securities, which are to be offered and sold to persons other
than United States and Canadian Persons. The two forms of prospectus are
identical except for the outside front cover page and the outside back
cover page. Such form of prospectus relating to the U.S. Securities as
first filed with the Commission pursuant to Rule 424(b) after the Execution
Time or, if no filing pursuant to Rule 424(b) is required, such form of
final prospectus relating to the U.S. Securities included in the
Registration Statement at the Effective Date, is hereinafter called the
"U.S. Prospectus"; such form of prospectus relating to the International
Securities as first filed with the Commission pursuant to Rule 424(b) after
the Execution Time or, if no filing pursuant to Rule 424(b) is required,
such form of final prospectus relating to the International Securities
included in the Registration Statement at the Effective Date, is
hereinafter called the "International Prospectus"; and the U.S. Prospectus
and the International Prospectus are hereinafter collectively called the
"Prospectuses". Insofar as they relate to offers or sales of Securities in
Canada, all references herein to the U.S. Preliminary Prospectus and the
U.S. Prospectus shall include the Canadian Offering Memorandum.
(b) On the Effective Date, the Registration Statement did or will,
and when the Prospectuses are first filed (if required) in accordance with
Rule 424(b) and on the Closing Date (as defined herein), the Prospectuses
(and any supplements thereto) will, comply in all material respects with
the applicable requirements of the Act and the Exchange Act and the
respective rules thereunder; on the Effective Date and at the Execution
Time, the Registration Statement did not or will not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary in order to make the statements therein not
misleading; and, on the Effective Date, the Prospectuses, if not filed
pursuant to Rule 424(b), will not, and on the date of any filing pursuant
to Rule 424(b) and on the Closing Date and any settlement date, the
Prospectuses (together with any supplement thereto) will not, 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; provided,
however, that the Company makes no representations or warranties as to the
information contained in or omitted from the Registration Statement or the
Prospectuses (or any supplement thereto) in reliance upon and in conformity
with information furnished herein or in writing to the Company by or on
behalf of any Manager through the Lead Managers specifically for inclusion
in the Registration Statement or the Prospectuses (or any supplement
thereto) or by or on behalf of the
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Selling Stockholder specifically for inclusion in the Registration
Statement or the Prospectuses (or any supplement thereto).
(c) None of the sale of the Securities, the consummation of any other
of the transactions contemplated herein or in the U.S. Underwriting
Agreement (including the conversion of the Class B Stock to Common Stock)
or the fulfillment of the terms hereof of thereof will conflict with,
result in a breach or violation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, (i) the charter or by-laws of the Company or any
of its subsidiaries, (ii) the obligations of the Company or any of its
subsidiaries pursuant to the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the Company or any
of its subsidiaries is a party or bound or to which its or their property
is subject, or (iii) the obligations of the Company or any of its
subsidiaries pursuant to any statute, law, rule, regulation, judgment,
order or decree applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or any
of its subsidiaries or any of its or their properties, which conflict,
breach, violation or imposition would, in the case of clauses (ii) and
(iii) above, either individually or in the aggregate with all other
conflicts, breaches and violations referred to in this paragraph (c) (if
any), have an adverse effect on the consummation of the transactions
contemplated herein or in the U.S. Underwriting Agreement or have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in
the Prospectuses (exclusive of any supplement thereto).
(d) The restrictions relating to the transferability of the Class B
Stock imposed by Section III.E. of Article Fourth of the Restated
Certificate of Incorporation of the Company have been duly waived by the
Board of Directors of the Company.
(e) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property is pending or,
to the best knowledge of the Company, threatened that (i) could reasonably
be expected to have a material adverse effect on the performance of this
Agreement or the U.S. Underwriting Agreement or the consummation of any of
the transactions contemplated hereby or thereby or (ii) could reasonably be
expected to have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Prospectuses (exclusive of any supplement thereto).
(f) Except as disclosed in the Registration Statement and the
Prospectuses (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectuses (or any amendment or supplement thereto),
neither the Company nor any of its subsidiaries has incurred any liability
or obligation, direct or contingent,
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or entered into any transaction, not in the ordinary course of business,
that is material to the Company and its subsidiaries taken as a whole, and
there has not been any change in the capital stock, or material increase in
the short-term debt or long-term debt, of the Company or any of its
subsidiaries, or any material adverse change, or any development having or
which may reasonably be expected to have a material adverse change, in the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Prospectuses (exclusive of any
supplement thereto).
Any certificate signed by any officer of the Company and delivered to
the Lead Managers or counsel for the Managers in connection with the offering of
the Securities shall be deemed a representation and warranty by the Company, as
to matters covered thereby, to each Manager.
(ii) The Selling Stockholder represents and warrants to, and agrees
with, each Manager that:
(a) The Selling Stockholder is the lawful owner of the Class B Stock
and that, upon the conversion of the Class B Stock and the sale and
delivery of, and payment for, the Securities, as provided herein and in the
International Underwriting Agreement, the Selling Stockholder will convey
to the Underwriters good and marketable title to the Class B Stock and,
assuming the conversion of the Class B Stock into the Common Stock as
provided in this Agreement and the U.S. Underwriting Agreement, the
Securities, free and clear of all liens, encumbrances, equities and claims
whatsoever.
(b) The Selling Stockholder has not taken, directly or indirectly,
any action designed to or which has constituted or which might reasonably
be expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(c) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Selling
Stockholder of the transactions contemplated herein or in the International
Underwriting Agreement, except such as may have been obtained under the Act
and such as may be required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the Securities by the
Underwriters and such other approvals as have been obtained.
(d) Assuming that the Board of Directors of the Company has approved
the transactions contemplated by this Agreement, none of the sale of the
Class B Stock and, assuming the conversion of the Class B Stock into the
Common Stock as provided in this Agreement and the U.S. Underwriting
Agreement, the Securities being sold by the Selling Stockholder, the
consummation of any other of the transactions herein contemplated by the
Selling Stockholder or the fulfillment of the terms hereof or thereof by
the Selling Stockholder will conflict with, result in a breach or violation
of, or constitute a default under any law or the trust agreement of the
Selling Stockholder (the "Trust Agreement") or the terms
6
of any indenture or other agreement or instrument to which the Selling
Stockholder is a party or by which it is bound, or any judgment, order or
decree applicable to the Selling Stockholder of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over the Selling Stockholder.
(e) In respect of any statements in or omissions from the
Registration Statement or the Prospectuses or any supplements thereto made
in reliance upon and in conformity with information furnished in writing to
the Company by the Selling Stockholder specifically for use in connection
with the preparation thereof, the Selling Stockholder hereby makes the same
representations and warranties to each U.S. Underwriter as the Company
makes to such U.S. Underwriter under paragraph (i)(b) of this Section.
Any certificate signed by the Selling Stockholder and delivered to the
Lead Managers or counsel for the Managers in connection with the offering of the
Securities shall be deemed a representation and warranty by the Selling
Stockholder, as to matters covered thereby, to each Manager.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Selling
Stockholder agrees to sell to each Manager, and each Manager agrees severally
and not jointly to purchase from the Selling Stockholder, at a purchase price of
$[ ] per share, the Class B Stock which, when converted as described herein,
will equal the amount of the International Securities set forth opposite such
Manager's name in Schedule I hereto [and the Company agrees to pay to each
Manager a[n additional] discount of $[ ] for each share purchased by such
Manager]. It is understood that the Managers are not obligated to purchase any
International Securities unless all the U.S. Underwritten Securities are
purchased by the U.S. Underwriters.
3. Delivery and Payment. Delivery of and payment for the
International Securities shall be made at 10:00 AM, New York City time, on [
], 1998, or at such time on such later date not more than three Business Days
after the foregoing date as the Lead Managers and the U.S. Representatives shall
designate, which date and time may be postponed by agreement among the Lead
Managers, the U.S. Representatives, the Company and the Selling Stockholder or
as provided in Section 9 hereof (such date and time of delivery and payment for
the U.S. Securities being herein called the "Closing Date"). Delivery of the
International Securities shall be made to the Lead Managers for the respective
accounts of the several Managers against payment by the several Managers through
the Lead Managers of the purchase price of the International Securities to or
upon the order of the Selling Stockholder by wire transfer payable in same-day
funds to the account specified by the Selling Stockholder [and against payment
by the Company of the discount of $[ ] for each share purchased by the
Managers to or upon the order of the several Managers through the Lead Managers
by wire transfer payable in same-day funds to the account specified by the U.S.
Underwriters through Xxxxxxx Xxxxx Xxxxxx]. Delivery of the International
Securities shall be made through the facilities of The Depository Trust Company
unless the Lead Managers shall otherwise instruct.
The Company will pay all applicable state transfer taxes, if any,
involved in the transfer to the several Managers of the International
Securities, and the respective Managers will pay any additional stock transfer
taxes involved in further transfers.
7
On the Closing Date, the Selling Stockholder will surrender
certificates, duly endorsed to the Company or in blank, for shares of Class B
Stock to the Company or its transfer agent for conversion into the International
Securities. The Company shall or shall cause its transfer agent to, on the
Closing Date upon receipt of such certificates, effect such conversion and issue
the International Securities for the respective accounts of the several
Managers.
4. Offering by Managers. It is understood that the several Managers
propose to offer the International Securities for sale to the public as set
forth in the International Prospectus.
5. Agreements.
(i) The Company agrees with the several Managers that:
(a) The Company will use its reasonable best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment of the
Registration Statement or supplement to the Prospectuses or any Rule 462(b)
Registration Statement unless the Company has furnished you a copy for your
review prior to filing and will not file any such proposed amendment or
supplement to which you reasonably object. Subject to the foregoing
sentence, if the Registration Statement has become or becomes effective
pursuant to Rule 430A, or filing of the Prospectuses is otherwise required
under Rule 424(b), the Company will cause the Prospectuses, properly
completed, and any supplement thereto to be filed with the Commission
pursuant to the applicable paragraph of Rule 424(b) within the time period
prescribed and will provide evidence satisfactory to the Lead Managers of
such timely filing. Upon your request, the Company will cause the Rule
462(b) Registration Statement, completed in compliance with the Act and the
applicable rules and regulations thereunder, to be filed with the
Commission pursuant to Rule 462(b) and will provide evidence satisfactory
to the Lead Managers of such filing. The Company will promptly advise the
Lead Managers (1) when the Registration Statement, if not effective at the
Execution Time, shall have become effective, (2) when the Prospectuses, and
any supplement thereto, shall have been filed (if required) with the
Commission pursuant to Rule 424(b) or when any Rule 462(b) Registration
Statement shall have been filed with the Commission, (3) when, prior to
termination of the offering of the Securities, any amendment to the
Registration Statement shall have been filed or become effective, (4) of
any request by the Commission or its staff for any amendment of the
Registration Statement, or any Rule 462(b) Registration Statement, or for
any supplement to the Prospectuses or for any additional information, (5)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (6) of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the International Securities for sale in any jurisdiction
or the institution or threatening of any proceeding for such purpose. The
Company will use its reasonable best efforts to prevent the issuance of any
such stop order or the suspension of any such qualification and, if issued,
to obtain as soon as possible the withdrawal thereof.
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(b) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of
which the Prospectuses as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under
which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Prospectuses to comply with
the Act or the Exchange Act or the respective rules thereunder, the Company
promptly will (1) notify the Lead Managers of such event, (2) prepare and
file with the Commission, subject to the second sentence of paragraph
(i)(a) of this Section 5, an amendment or supplement which will correct
such statement or omission or effect such compliance and (3) supply any
supplemented Prospectuses to you in such quantities as you may reasonably
request.
(c) As soon as practicable, the Company will make generally available
to its security holders and to the Lead Managers an earnings statement or
statements of the Company and its subsidiaries which will satisfy the
provisions of Section 11(a) of the Act and Rule 158 under the Act.
(d) The Company will furnish to the Lead Managers and counsel for the
Managers, without charge, signed copies of the Registration Statement
(including exhibits thereto) and to each other Manager a copy of the
Registration Statement (without exhibits thereto) and, so long as delivery
of a prospectus by an Manager or dealer may be required by the Act, as many
copies of each Preliminary Prospectus and the Prospectuses and any
supplement thereto as the Lead Managers may reasonably request. The
Company will pay the expenses of printing or other production of all
documents relating to the offering.
(e) The Company will arrange, if necessary, for the qualification of
the Securities for sale under the laws of such jurisdictions as the Lead
Managers may designate, will maintain such qualifications in effect so long
as required for the distribution of the Securities and will pay any fee of
the National Association of Securities Dealers, Inc., in connection with
its review of the offering; 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 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.
(f) The Company will not, without the prior written consent of
Xxxxxxx Xxxxx Barney, for a period of 90 days following the Execution Time,
offer, sell, contract to sell, pledge or otherwise dispose of (or enter
into any transaction which is designed to, or might reasonably be expected
to, result in the disposition (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) by the Company or
any affiliate of the Company or any person in privity with the Company or
any affiliate of the Company), directly or indirectly, or announce the
offering of, or file a registration statement with the Commission in
respect of, any other shares of Common Stock or any securities
convertible into, or exercisable or exchangeable for, shares of Common
Stock, or grant any options, warrants or similar securities to purchase
Common Stock; provided, however, that the Company may issue and sell Common
Stock or make any awards pursuant to any employee stock option plan, stock
ownership plan or
9
dividend reinvestment plan of the Company in effect at the Execution Time
and the Company may issue Common Stock issuable upon the conversion of
securities (including Class B Stock) or the exercise of warrants
outstanding at the Execution Time.
(g) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(h) The Company agrees to pay the costs and expenses relating to the
following matters: (i) the preparation, printing or reproduction and
filing with the Commission of the Registration Statement (including
financial statements and exhibits thereto), each Preliminary Prospectus,
the Prospectuses and each amendment or supplement to any of them; (ii) the
printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of such copies of the
Registration Statement, each Preliminary Prospectus, the Prospectuses and
all amendments or supplements to any of them, as may, in each case, be
reasonably requested for use in connection with the offering and sale of
the Securities; (iii) the preparation, printing, authentication, issuance
and delivery of certificates for the Securities, including any stamp or
transfer taxes in connection with the original issuance and sale of the
Securities; (iv) the printing (or reproduction) and delivery of this
Agreement, the U.S. Underwriting Agreement, any blue sky memorandum and all
other agreements or documents printed (or reproduced) and delivered in
connection with the offering of the Securities; (v) the listing of the
Option Securities on the New York Stock Exchange; (vi) any registration or
qualification of the Securities for offer and sale under the securities or
blue sky laws of the several states or Canada or any other foreign
jurisdiction or locality therein (including filing fees and the reasonable
fees and expenses of counsel for the Underwriters relating to such
registration and qualification); (vii) any filings required to be made with
the National Association of Securities Dealers, Inc. (including filing fees
and the reasonable fees and expenses of counsel for the Underwriters
relating to such filings); (viii) the transportation and other expenses
incurred by or on behalf of Company representatives in connection with
presentations to prospective purchasers of the Securities; (ix) the fees
and expenses of the Company's accountants and the fees and expenses of
counsel (including local and special counsel) for the Company and the
Selling Stockholder subject as set forth in the last sentence of this
paragraph (h) of Section 5 to the Registration Rights Agreement (as
defined); (x) the conversion of the Class B Stock into the Securities; and
(xi) all other costs and expenses incident to the performance by the
Company and the Selling Stockholder of their obligations hereunder. This
paragraph (h) of Section 5 shall in no way be interpreted to amend, alter
or suspend the terms and provisions of the Registration Rights Agreement
dated March 30, 1993, between the Company and the Selling Stockholder (the
"Registration Rights Agreement") with respect to the rights and
obligations of the Company and the Selling Stockholder vis-a-vis each
other, but not with respect to the rights of the Managers pursuant to this
Agreement.
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(ii) The Selling Stockholder agrees with the several Managers that:
(a) The Selling Stockholder will not, without the prior written
consent of Xxxxxxx Xxxxx Xxxxxx, offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, or file (or participate in
the filing of) a registration statement with the Commission in respect of,
or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Exchange
Act with respect to, any shares of capital stock of the Company or any
securities convertible into or exercisable or exchangeable for such capital
stock, or publicly announce an intention to effect any such transaction,
for a period of 90 days following the Execution Time, other than the
conversion of Class B Stock into Common Stock.
(b) The Selling Stockholder will not take any action designed to or
which has constituted or which might reasonably be expected to cause or
result, under the Exchange Act or otherwise, in stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities.
(c) The Selling Stockholder will advise you promptly, and if
requested by you, will confirm such advice in writing, so long as delivery
of a prospectus relating to the Securities by an underwriter or dealer may
be required under the Act, of any change in information in the Registration
Statement or the Prospectuses relating to the Selling Stockholder.
(iii) Each Manager agrees that (a) it is not purchasing any of the
International Securities for the account of any United States or Canadian
Person, (b) it has not offered or sold, and will not offer or sell, directly or
indirectly, any of the International Securities or distribute any International
Prospectus to any person in the United States or Canada, or to any United States
or Canadian Person, (c) any dealer to whom it may sell any of the International
Securities will represent that it is not purchasing for the account of any
United States or Canadian Person and agree that it will not offer or resell,
directly or indirectly, any of the International Securities in the United States
or Canada, or to any United States or Canadian Person or to any other dealer who
does not so represent and agree; provided, however, that the foregoing shall not
restrict (i) purchases and sales between the U.S. Underwriters on the one hand
and the Managers on the other hand pursuant to the Agreement Between U.S.
Underwriters and Managers, (ii) stabilization transactions contemplated under
the Agreement Between U.S. Underwriters and Managers, conducted through Xxxxxxx
Xxxxx Barney (or through the U.S. Representatives and the Lead Managers) as part
of the distribution of the Securities and (iii) sales to or through (or
distributions of International Prospectuses or International Preliminary
Prospectuses to) non-United States or Canadian Persons who are investment
advisors, or who otherwise exercise investment discretion, and who are
purchasing for the account of any United States or Canadian Person and (d) the
executive officers and directors of the Company and Navistar International
Transportation Corp. ("NITC"), other than Xxxx X. Xxxxx and Xxxxxx X. Xxxxxxx,
may sell, pledge or otherwise dispose of up to an aggregate of 200,000 shares
during the period beginning on the Execution Time and ending on August 14, 1998.
(iv) The agreements of the Managers set forth in paragraph (iii) of
this Section 5 shall terminate upon the earlier of the following events:
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(a) a mutual agreement of the U.S. Representatives and the Lead
Managers to terminate the selling restrictions set forth in paragraph (iii)
of this Section 5 and in Section 5(iii) of the U.S. Underwriting Agreement;
or
(b) the expiration of a period of 30 days after the Closing Date,
unless (1) the Lead Managers shall have given notice to the Company, the
Selling Stockholder and the U.S. Representatives that the distribution of
the International Securities by the Managers has not yet been completed or
(2) the U.S. Representatives shall have given notice to the Company, the
Selling Stockholder and the Managers that the distribution of the U.S.
Securities by the U.S. Underwriters has not yet been completed. If such
notice by the U.S. Representatives or the Lead Managers is given, the
agreements set forth in such paragraph (iii) shall survive until the
earlier of (A) the event referred to in clause (a) of this subsection (iv)
or (B) the expiration of an additional period of 30 days from the date of
any such notice.
(v) Each Manager agrees that it (i) will not offer or sell any shares
to persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments
(whether as principal or agent) for the purpose of their businesses or in other
circumstances which do not constitute an offer to the public in the United
Kingdom for the purposes of the Public Offers of Securities Regulation 1995 (the
"Regulations"), (ii) will comply with all applicable provisions of the
Regulations and of the Financial Services Xxx 0000 with respect to anything done
by it in relation to the shares in, from or otherwise involving the United
Kingdom and (iii) will only issue or pass on in the United Kingdom any document
received by it in connection with the issue of these shares if that person is of
a kind described in Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1996 (as amended) or is a person to whom such
documents may otherwise lawfully be issued or passed on.
6. Conditions to the Obligations of the Managers. The obligations of
the Managers to purchase the International Securities shall be subject to the
accuracy of the representations and warranties on the part of the Company and
the Selling Stockholder contained herein as of the Execution Time, the Closing
Date, to the accuracy of the statements of the Company and the Selling
Stockholder made in any certificates pursuant to the provisions hereof, to the
performance by the Company and the Selling Stockholder of their respective
obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Lead Managers agree in writing to a later
time, the Registration Statement will become effective not later than (i)
6:00 PM New York City time on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Prospectuses, or any supplement thereto, is required pursuant
to Rule 424(b), the Prospectuses, and any such supplement, will be filed in
the manner and within the time period required by
Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
12
(b) The Company shall have caused Xxxxxxxx & Xxxxx, counsel for the
Company, to have furnished to the Lead Managers their opinion, dated the
Closing Date and addressed to the Lead Managers, to the effect that:
(i) each of the Company, NITC and Navistar Financial
Corporation ("NFC") is validly existing as a corporation and in good
standing under the General Corporation Law of the State of Delaware.
Under their respective Certificates of Incorporation and By-Laws, each
of the Company, NITC and NFC has the corporate power and authority
necessary to own and lease its properties and to conduct its business
as described in the Prospectuses;
(ii) this Agreement and the U.S. Underwriting Agreement have
been duly authorized, executed and delivered by the Company;
(iii) the U.S. Option Securities to be sold by the Company
pursuant to the U.S. Underwriting Agreement are duly authorized
validly issued, fully paid and nonassessable, [the sale of the U.S.
Option Securities is not subject to any preemptive rights under the
terms of the statue under which the Company is incorporated, under the
Company's Certificate of Incorporation or under any contractual
provision of which such counsel has knowledge]; the Securities to be
purchased by the Underwriters from the Selling Stockholder pursuant to
this Agreement and the U.S. Underwriting Agreement are duly authorized
validly issued, fully paid and nonassessable;
(iv) the Company's authorized capital stock (including its
authorized Common Stock) is as set forth under the heading
"Capitalization" in the Prospectuses and conforms in all material
respects to the description of the terms thereof contained under the
heading "Description of Capital Stock" in the Prospectuses;
(v) the Company's execution and delivery of this Agreement and
the U.S. Underwriting Agreement and the sale of the Securities to you
in accordance with this Agreement and the U.S. Underwriting Agreement
and the consummation by the Company of the other transactions
contemplated herein or therein (including the conversion of the Class
B Stock to Common Stock) do not (A) violate the Company's Certificate
of Incorporation or Bylaws or (B) constitute a violation by the
Company of any applicable provision of any law, statute or regulation
(except that such counsel expresses no opinion in this paragraph as to
compliance with any disclosure requirement or any prohibition against
fraud or misrepresentation or as to whether performance of the
indemnification or contribution provisions in this Agreement or the
U.S. Underwriting Agreement would be permitted)
or (C) breach, or result in a default under, any existing obligation
of the Company or any of its subsidiaries under any of the agreements
set forth on Schedule A attached thereto (which representatives of the
Company have advised such counsel include all material debt agreements
and
13
instruments of or binding on the Company or any of the Company's
subsidiaries). The agreements in Schedule A contain debt incurrence
tests and/or other financial covenants and tests; such counsel has not
attempted to independently apply any of those covenants or tests.
Representatives of the Company have however advised such counsel that
they have applied all of those tests and covenants and have determined
that none of those tests or covenants will breached by the sale of the
Securities to you or by any of the other actions cited at the
beginning of this paragraph, and such counsel has assumed without
investigation that such advice and determination are correct;
(vi) such counsel has no knowledge about any legal action or
any governmental action, investigation or proceeding that is pending
or threatened against the Company, any of the Company's subsidiaries
or any of their property that has caused such counsel to conclude that
such preceding is required by Item 103 of Regulation S-K to be
described in the Prospectuses but that is not so described; such
counsel has no knowledge about any contract or other document to which
the Company or any of its subsidiaries is a party or to which any of
their property is subject that has caused such counsel to conclude
that such contract or other document is required to be described in
the Prospectuses but is not so described or is required to be filed as
an exhibit to the Registration Statement but has not been so filed;
(vii) a member of the Commission's staff has advised such
counsel by telephone that the Commission has entered an order
declaring the Registration Statement effective under the Act on June [
], 1998 (the "effective date"); such counsel has no knowledge that any
stop order suspending its effectiveness has been issued or that any
proceedings for that purpose are pending before, or overtly threatened
by, the Commission; the Prospectuses, and any supplements thereto,
have been filed with the Commission within the time period required by
Rule 424(b) under the Act; and such counsel shall state in a separate
paragraph that nothing has come to such counsel's attention that has
caused such counsel to conclude that (A) the Registration Statement at
the Effective Date contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or (B) the
Prospectuses at the date each bears or on the Closing Date contained
or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading or (C) as of the effective date, either the Registration
Statement or the Prospectuses appeared on its face not to be
responsive in all material respects to the requirements of Form S-3;
(viii) the Company was not required to file with, or obtain any
consent, approval, authorization or order of any governmental agency
or body for the sale of the Securities under this Agreement or the
U.S. Underwriting Agreement and the consummation by the Company of the
other transactions contemplated hereby or thereby (including the
conversion
14
of the Class B Stock to Common Stock), except for the registration of
the offer and sale of the Securities under the Act and as may be
required under [the Exchange Act] in connection with the purchase and
distribution of the Securities by the Underwriters;
(ix) the Company is not and, immediately after the sale of the
U.S. Option Securities to the U.S. Underwriters and the application of
the net proceeds therefrom as described in the Prospectus under the
caption "Use of Proceeds" will not be, an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended, and
(x) the information in the Prospectuses under the heading
"Certain United States Tax Consequences to Non-United States Holders"
to the extent that it summarizes laws, governmental rules and
regulations or documents is correct in all material respects.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State
of New York, the General Corporation Law of the State of Delaware or the
Federal laws of the United States, to the extent they deem proper and
specified in such opinion, upon the opinion of other counsel of good
standing whom they believe to be reliable and who are satisfactory to
counsel for the Managers and (B) as to matters of fact, to the extent they
deem proper, on certificates of responsible officers of the Company and
public officials. The opinion of such counsel shall be rendered to the
Managers at the request of the Company and shall so state. References to
the Prospectuses in this paragraph (b) include any supplements thereto at
the Closing Date.
(c) The Company shall have caused Xxxxxx X. Xxxxxxxx, Esq., Senior
Vice President and General Counsel of the Company, to have furnished to the
Lead Managers his opinion, dated the Closing Date and addressed to the Lead
Managers, to the effect that:
(i) each of the Company, NITC and NFC (individually a
"Subsidiary" and collectively the "Subsidiaries") has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction in which it is chartered or
organized, with full corporate power and authority to own or lease, as
the case may be, and to operate its properties and conduct its
business as described in the Prospectuses, and has been duly qualified
to do business as a foreign corporation and is in good standing under
the laws of each jurisdiction wherein it owns or leases material
properties or conducts material business and where the failure to be
so qualified would, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in
the Prospectuses; notwithstanding the foregoing limitation, NITC is
duly qualified to do business as a foreign corporation and is in good
standing under the laws of the States of Arkansas, Indiana, Illinois,
Ohio, Texas and Wisconsin;
15
(ii) all the outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued and are fully
paid and nonassessable, and, except as otherwise set forth in the
Prospectuses, all outstanding shares of capital stock of the
Subsidiaries are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any perfected security
interest and, to the knowledge of such counsel, after due inquiry, any
other security interest, claim, lien or encumbrance;
(iii) the Company's authorized capital stock (including its
authorized Common Stock) is as set forth under the heading
"Capitalization" in the Prospectuses and conforms in all material
respects to the description of the terms thereof contained under the
heading "Description of Capital Stock" in the Prospectuses;
(iv) the outstanding shares of Common Stock (including the
Securities being sold hereunder and under the U.S. Underwriting
Agreement) and Class B Stock have been duly and validly authorized and
issued and are fully paid and nonassessable; the Securities have been
duly and validly authorized, and, when issued and delivered to and
paid for by the U.S. Underwriters pursuant to the U.S. Underwriting
Agreement and by the International Underwriters pursuant hereto, will
be fully paid and nonassessable; the Securities are duly listed, and
admitted and authorized for trading, on the New York Stock Exchange
subject to official notice of issuance and evidence of satisfactory
distribution, on the New York Stock Exchange; the certificates for the
Securities are in valid and sufficient form; the holders of
outstanding shares of capital stock of the Company are not entitled to
preemptive or other rights to subscribe for the Securities and, except
as set forth in the Prospectuses, no options, warrants or other rights
to purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares of
capital stock of or ownership interests in the Company are
outstanding;
(v) to the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of the Subsidiaries or its or their property of a
character required to be disclosed in the Registration Statement which
is not adequately disclosed in the Prospectuses, and there is no
franchise, contract or other document of a character required to be
described in the Registration Statement or Prospectuses, or to be
filed as an exhibit thereto, which is not described or filed as
required; and the information in the Prospectuses under the headings
"Risk Factors--Impact of Government Regulation", "Management's
Discussion and Analysis of Results and Operations and Financial
Condition--Environmental Matters" and "Description of Capital Stock"
to the extent that it summarizes laws, governmental rules and
regulations or documents is correct in all material respects;
(vi) none of the issuance and sale of the Securities, the
consummation of any other of the transactions contemplated herein or
in the
16
U.S. Underwriting Agreement or the fulfillment of the terms hereof or
thereof will conflict with, result in a breach or violation of or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or the Subsidiaries pursuant to (A) the
Certificate of Incorporation or Bylaws of the Company or the
Subsidiaries, (B) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument known to such
counsel to which the Company or any Subsidiary is a party or bound or
to which its or their property is subject, or (C) any statute, law,
rule, regulation, judgment, order or decree known to such counsel to
be applicable to the Company or any of the Subsidiaries of any court,
regulatory body, administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the Company or the
Subsidiaries or any of its or their property, which violation or
default would, in the case of clauses (B) and (C) above, either
individually or in the aggregate with all other violations and
defaults referred to in this paragraph (vi) (if any), have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in
the Prospectuses;
(vii) such counsel has no reason to believe that the
Registration Statement on the Effective Date contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectuses as of their dates and
on the Closing Date included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary
to make the statements therein, in the light of the circumstances
under which they were made, not misleading (in each case, other than
the financial statements and other financial information contained
therein, as to which such counsel need express no opinion); and
(viii) except as set forth in the Prospectuses, no holders of
securities of the Company have rights to the registration of such
securities under the Registration Statement.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State
of Illinois, the General Corporation Law of the State of Delaware or the
Federal laws of the United States, to the extent such counsel deems proper
and specified in such opinion, upon the opinion of other counsel of good
standing whom they believe to be reliable and who are satisfactory to
counsel for the Lead Managers and (B) as to matters of fact, to the extent
such counsel deems proper, on certificates of responsible officers of the
Company and public officials. The opinion of such counsel shall be
rendered to the Lead Managers at the request of the Company and shall so
state. References to the Prospectuses in this paragraph (c) include any
supplements thereto at the Closing Date.
(d) The Selling Stockholder shall have caused Xxxxxxx Xxxx &
Xxxxxxxxx, counsel for the Selling Stockholder, to have furnished to the
Lead Managers their
17
opinion, dated the Closing Date and addressed to the Lead Managers, to the
effect that:
(i) this Agreement and the U.S. Underwriting Agreement have
been duly authorized, executed and delivered by the Selling
Stockholder and, assuming that the Board of Directors of the Company
has approved the transactions contemplated by this Agreement, the
Selling Stockholder has full legal right and authority to surrender
the Class B Stock for conversion into the Securities and to sell,
transfer and deliver the Class B Stock and, assuming the conversion of
the Class B Stock into the Common Stock as provided in this Agreement
and the U.S. Underwriting Agreement, the Securities in the manner
provided in this Agreement and in the U.S. Underwriting Agreement;
(ii) the delivery to the several Underwriters of certificates
for the Securities against payment therefor as provided herein and in
the U.S. Underwriting Agreement, assuming that the Board of Directors
of the Company has approved the transactions contemplated by this
Agreement, will pass good and marketable title to the Class B Stock
and, assuming the conversion of the Class B Stock into the Common
Stock as provided in this Agreement and the U.S. Underwriting
Agreement, the Securities to the several Underwriters, free and clear
of all liens, encumbrances, equities and claims whatsoever;
(iii) no consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation by the
Selling Stockholder of the transactions contemplated herein and in the
U.S. Underwriting Agreement, except such as may have been obtained
under the Act and such as may be required under the blue sky laws of
any jurisdiction in connection with the purchase and distribution of
the Securities by the Underwriters and such other approvals (specified
in such opinion) as have been obtained; and
(iv) none of the sale of the Class B Stock or, assuming the
conversion of the Class B Stock into the Common Stock as provided in
this Agreement and the U.S. Underwriting Agreement, the Securities,
the consummation of any other of the transactions contemplated herein
or in the U.S. Underwriting Agreement by the Selling Stockholder or
the fulfillment of the terms hereof or thereof by the Selling
Stockholder, assuming that the Board of Directors of the Company has
approved the transactions contemplated by this Agreement, will
conflict with, result in a breach or violation of, or constitute a
default under any law or the Trust Agreement or the terms of the
settlement agreement dated March 30, 1993, as amended, between the
Company and the Selling Stockholder, or any judgment, order or decree
known to such counsel to be applicable to the Selling Stockholder of
any court, regulatory body, administrative agency, governmental body
or arbitrator having jurisdiction over the Selling Stockholder.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of the Employee Retirement Income Security Act of
1974, as amended,
18
or the application of laws of any jurisdiction other than the State of New
York, the State of Delaware or the Federal laws of the United States, to
the extent they deem proper and specified in such opinion, upon the opinion
of other counsel of good standing whom they believe to be reliable and who
are satisfactory to counsel for the Managers, and (B) as to matters of
fact, to the extent they deem proper, on certificates of the Selling
Stockholder and public officials. The opinion of such counsel shall be
rendered to the Managers at the request of the Selling Stockholder and
shall so state.
(e) The Lead Managers shall have received from Cravath, Swaine &
Xxxxx, counsel for the Managers, such opinion or opinions, dated the
Closing Date and addressed to the Lead Managers, with respect to the
issuance and sale of the Securities, the Registration Statement, the
Prospectuses (together with any supplement thereto) and other related
matters as the Lead Managers may reasonably require, and the Company and
the Selling Stockholder shall have furnished to such counsel such documents
as they request for the purpose of enabling them to pass upon such matters.
(f) The Company shall have furnished to the Lead Managers a
certificate of the Company, signed by the Executive Vice President and
Chief Financial Officer of the Company and the Treasurer of the Company,
dated the Closing Date, to the effect that the signers of such certificate
have carefully examined the Registration Statement, the Prospectuses, any
supplements to the Prospectuses, this Agreement and the U.S. Underwriting
Agreement and that:
(i) the representations and warranties of the Company in this
Agreement and in the U.S. Underwriting Agreement are true and correct
in all material respects on and as of the Closing Date with the same
effect as if made on the Closing Date, and the Company has complied
with all the agreements and satisfied all the conditions on its part
to be performed or satisfied at or prior to the Closing Date;
(ii) 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 Company's knowledge,
threatened; and
(iii) since the date of the most recent financial statements
included or incorporated by reference in the Prospectuses (exclusive
of any supplement thereto), there has been no material adverse change
in the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the
Prospectuses (exclusive of any supplement thereto).
(g) The Selling Stockholder shall have furnished to the Lead Managers
a certificate, signed by Xxxxx Xxxxxxxxxx, the Secretary of the
Supplemental Committee of the Selling Stockholder, dated the Closing Date,
to the effect that (i) the signer of such certificate has carefully
examined the Registration Statement, the Prospectuses, any supplement to
the Prospectuses, this Agreement and the U.S.
Underwriting Agreement, (ii) the representations and warranties of the
Selling Stockholder in this Agreement and in the U.S. Underwriting
Agreement are true
19
and correct in all material respects on and as of the Closing Date to the
same effect as if made on the Closing Date and (iii) the Selling
Stockholder has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the
Closing Date.
(h) The Company shall have caused Deloitte & Touche, LLP to have
furnished to the Lead Managers and the Selling Stockholder, at the
Execution Time and at the Closing Date, letters, dated respectively as of
the Execution Time and as of the Closing Date, in form and substance
satisfactory to the Lead Managers, confirming that they are independent
accountants within the meaning of the Act and the Exchange Act and the
respective applicable published rules and regulations thereunder and that
they have performed a review of the unaudited interim financial information
of the Company for the three-month periods ended January 31, 1998 and 1997
and April 30, 1998 and 1997 and as at January 31, 1998 and 1997 and April
30, 1998 and 1997, in accordance with Statement on Auditing Standards No.
71, and stating in effect that:
(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated by reference in
the Registration Statement and the Prospectuses and reported on by
them comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the
related published rules and regulations;
(ii) on the basis of a reading of the latest unaudited financial
statements made available by the Company and its subsidiaries; their
limited review, in accordance with standards established under
Statement on Auditing Standards No. 71, of the unaudited interim
financial information for the three-month periods ended January 31,
1998 and 1997, and as at January 31, 1998 and 1997; carrying out
certain specified procedures (but not an examination in accordance
with generally accepted auditing standards) which would not
necessarily reveal matters of significance with respect to the
comments set forth in such letter; a reading of the minutes of the
meetings of the stockholders, directors, audit, organizational and
finance committees of the Company and its subsidiaries; and inquiries
of certain officials of the Company who have responsibility for
financial and accounting matters of the Company and its subsidiaries
as to transactions and events subsequent to October 31, 1997, nothing
came to their attention which caused them to believe that:
(1) any unaudited financial statements included in the
Registration Statement and the Prospectuses do not comply as to
form in all material respects with applicable accounting
requirements of the Act and the Exchange Act and the related
rules and regulations adopted by the Commission; and said
unaudited financial statements are not in conformity with
generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial
statements included or incorporated by reference in the
Registration Statement and the Prospectuses;
20
(2) with respect to the period subsequent to January 31,
1998, there were, at a specified date not more than five days
prior to the date of the letter, any changes in the capital
stock, increase in consolidated debt of the Company or decreases
in the total assets or shareowners' equity of the Company and its
subsidiaries as compared with the amounts shown on the January
31, 1998, consolidated statement of financial condition included
in the Registration Statement and the Prospectuses, or for the
period from February 1, 1998, to such specified date there were
any decreases, as compared with the corresponding period in the
preceding fiscal year, in consolidated sales of manufactured
product, total sales and revenue, income before income taxes or
net income of the Company and its subsidiaries, except in all
instances for changes, increases or decreases set forth in such
letter, in which case the letter shall be accompanied by an
explanation by the Company as to the significance thereof unless
said explanation is not deemed necessary by the U.S.
Representatives; or
(3) the information included or incorporated by reference
in the Registration Statement and the Prospectuses in response to
Regulation S-K, Item 301 (Selected Financial Data) and Item 402
(Executive Compensation), is not in conformity with the
applicable disclosure requirements of Regulation S-K; and
(iii) they have performed certain other specified procedures as a
result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Registration Statement and the Prospectuses, including
the information set forth under the captions "Prospectus Summary",
"Risk Factors", "Capitalization", "Selected Consolidated Financial and
Operating Data", "Management's Discussion and Analysis of Results of
Operations and Financial Condition", "Business" and "Description of
Capital Stock" in the Prospectuses, the information included or
incorporated by reference in Items 1, 6, 7, 11 and 13 of the Company's
Annual Report on Form 10-K, as amended, incorporated by reference in
the Registration Statement and the Prospectuses, the information
included in the "Management's Discussion and Analysis of Results of
Operations and Financial Condition" included in the Company's
Quarterly Report on Form 10-Q incorporated by reference in the
Registration Statement and the Prospectuses, the information included
in the Company's Current Reports on Form 8-K incorporated by reference
in the Registration Statement and the Prospectuses and the information
included in the Company's Proxy Statement incorporated by reference in
the Registration Statement and the Prospectuses agrees with the
accounting records of the Company and its subsidiaries, excluding any
questions of legal interpretation.
(i) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g)
21
under the Act) or any notice given of any intended or potential decrease in
any such rating or of a possible change in any such rating that does not
indicate the direction of the possible change.
(j) The Securities shall have been listed and admitted and authorized
for trading on the New York Stock Exchange, and satisfactory evidence of
such actions shall have been provided to the Lead Managers.
(k) At the Execution Time, the Company shall have furnished to the
Lead Managers a letter substantially in the form of Exhibit A hereto from
each executive officer and director of the Company or NITC addressed to the
Lead Managers.
(l) Prior to the Closing Date, the Company and the Selling
Stockholder shall have furnished to the Lead Managers such further
information, certificates and documents as the Lead Managers may reasonably
request.
(m) The closing of the purchase of the U.S. Underwritten Securities
pursuant to the U.S. Underwriting Agreement shall have occurred.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Lead Managers and counsel for the Managers, this Agreement
and all obligations of the Managers hereunder may be canceled at, or at any time
prior to, the Closing Date by the Lead Managers. Notice of such cancelation
shall be given to the Company and the Selling Stockholder in writing or by
telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Cravath, Swaine & Xxxxx, counsel for the Managers, at
Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing
Date.
7. Reimbursement of Managers' Expenses. If the sale of the
International Securities provided for herein is not consummated because any
condition to the obligations of the Managers set forth in Section 6 hereof
relating to the Company is not satisfied, because of any termination pursuant to
Section 10 hereof or because of any refusal, inability or failure on the part of
the Company to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any of the Managers, the Company will
reimburse the Managers severally through Xxxxxxx Xxxxx Barney on demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the International Securities. If the sale of the International
Securities provided for herein is not consummated because any condition to the
obligations of the Managers set forth in Section 6 hereof relating to the
Selling Stockholder is not satisfied or because of any refusal, inability or
failure on the part of the Selling Stockholder to perform any agreement herein
or comply with any provision hereof other than by reason of a default by any of
the Managers, the Selling Stockholder will reimburse the Managers severally
through Xxxxxxx Xxxxx Xxxxxx on demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
them in connection with the proposed purchase and sale of the International
Securities.
22
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Manager, the directors, officers, employees and
agents of each Manager, each person who controls any Manager within the meaning
of either the Act or the Exchange Act against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or other Federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the registration statement for the registration of the
Securities as originally filed or in any amendment thereof, or in any
International Preliminary Prospectus or U.S. Preliminary Prospectus or either of
the Prospectuses, or in any amendment thereof or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
any Manager through the Lead Managers specifically for inclusion therein;
provided further, however, that the Company will not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Selling Stockholder
specifically for inclusion therein. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.
(b) The Selling Stockholder agrees to indemnify and hold harmless
each Manager, the directors, officers, employees and agents of each Manager and
each person who controls any Manager within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
each Manager, but only with reference to written information furnished to the
Company by or on behalf of the Selling Stockholder specifically for inclusion in
the documents referred to in the foregoing indemnity. This indemnity agreement
will be in addition to any liability which the Selling Stockholder may otherwise
have. The Company and the Managers acknowledge that the information under the
heading "Selling Stockholder" related to the number of shares of Common Stock
held by the Selling Stockholder constitutes the only information furnished in
writing by or on behalf of the Selling Stockholder for inclusion in any U.S.
Preliminary Prospectus or International Preliminary Prospectus or the
Prospectuses.
(c) Each Manager severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who signs
the Registration Statement, each person who controls the Company within the
meaning of either the Act or the Exchange Act and the Selling Stockholder, to
the same extent as the foregoing indemnity to each Manager, but only with
reference to written information relating to such Manager furnished to the
Company by or on behalf of such Manager through the Lead Managers specifically
for inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which any Manager may
otherwise have. The Company and the Selling Stockholder acknowledge that the
statements set forth in the last paragraph of the cover page regarding delivery
of
23
the Securities, the legend in block capital letters on page 2 related to
stabilization, syndicate covering transactions and penalty bids and, under the
heading "Underwriting", (i) the sentences related to concessions and
reallowances, (ii) the paragraph related to the Agreements Between the U.S.
Underwriters and the Managers and (iii) the paragraphs related to stabilization,
syndicate covering transactions and penalty bids in any U.S. Preliminary
Prospectus or International Preliminary Prospectus and the Prospectuses
constitute the only information furnished in writing by or on behalf of the
several Managers for inclusion in any U.S. Preliminary Prospectus or
International Preliminary Prospectus or the Prospectuses.
(d) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a), (b) or (c) above unless and to the extent it did
not otherwise learn of such action and such failure results in the forfeiture by
the indemnifying party of substantial rights and defenses and (ii) will not, in
any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in
paragraph (a), (b) or (c) above. The indemnifying party shall be entitled to
appoint counsel of the indemnifying party's choice at the indemnifying party's
expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the reasonable fees and expenses of any separate
counsel retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties (which consent shall not unreasonably
be withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding.
(e) In the event that the indemnity provided in paragraph (a), (b) or
(c) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company, the Selling Stockholder and the
Managers agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses
24
reasonably incurred in connection with investigating or defending same)
(collectively "Losses") to which the Company, the Selling Stockholder and one or
more of the Managers may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company, by the Selling
Stockholder and by the Managers from the offering of the International
Securities; provided, however, that in no case shall any Manager (except as may
be provided in any agreement among underwriters relating to the offering of the
International Securities) be responsible for any amount in excess of the
underwriting discount or commission applicable to the International Securities
purchased by such Manager hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company, the
Selling Stockholder and the Managers shall contribute in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company, of the Selling Stockholder and of the Managers in
connection with the statements or omissions which resulted in such Losses as
well as any other relevant equitable considerations. Benefits received by the
Company and by the Selling Stockholder shall be deemed to be equal to the total
net proceeds from the offering (before deducting expenses) received by the
Selling Stockholder, and benefits received by the Managers shall be deemed to be
equal to the total underwriting discounts and commissions, in each case as set
forth on the cover page of the U.S. Prospectus. Relative fault shall be
determined by reference to, among other things, whether any untrue or any
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information provided by the Company, the
Selling Stockholder or the Managers, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The Company, the Selling Stockholder and the
Managers agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation which does
not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (e), no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who
controls a Manager within the meaning of either the Act or the Exchange Act and
each director, officer, employee and agent of an Manager shall have the same
rights to contribution as such Manager, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each director of
the Company shall have the same rights to contribution as the Company, subject
in each case to the applicable terms and conditions of this paragraph (e).
Notwithstanding the foregoing, this paragraph (e) shall not be interpreted to
provide for any obligation of the Selling Stockholder in excess of the
obligations to which the Selling Stockholder would be subject under paragraph
(b) of this Section 8 if indemnity under such paragraph (b) had been available.
9. Default by a Manager. If any one or more Managers shall fail to
purchase and pay for any of the International Securities agreed to be purchased
by such Manager or Managers hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Managers shall be obligated severally to take up and
pay for (in the respective proportions which the amount of International
Securities set forth opposite their names in Schedule I hereto bears to the
aggregate amount of International Securities set forth opposite the names of all
the remaining Managers) the International Securities which the defaulting
Manager or Managers agreed but failed to purchase; provided, however, that in
the event that the aggregate amount of International Securities which the
defaulting Manager or Managers
25
agreed but failed to purchase shall exceed 10% of the aggregate amount of
International Securities set forth in Schedule I hereto, the remaining Managers
shall have the right to purchase all, but shall not be under any obligation to
purchase any, of the International Securities, and if such nondefaulting
Managers do not purchase all the International Securities, this Agreement will
terminate without liability to any nondefaulting Manager, the Selling
Stockholder or the Company. In the event of a default by any Manager as set
forth in this Section 9, the Closing Date shall be postponed for such period,
not exceeding five Business Days, as the Lead Managers shall determine in order
that the required changes in the Registration Statement and the Prospectuses or
in any other documents or arrangements may be effected. Nothing contained in
this Agreement shall relieve any defaulting Manager of its liability, if any, to
the Company, the Selling Stockholder and any nondefaulting Manager for damages
occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Lead Managers, by notice given to the Company
prior to delivery of and payment for the International Securities, if at any
time prior to such time (i) trading in the Company's Common Stock shall have
been suspended by the Commission on the New York, Chicago or Pacific Stock
Exchanges or trading in securities generally on the New York Stock Exchange
shall have been suspended or limited or minimum prices shall have been
established on the New York Stock Exchange, (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war, or other calamity or crisis
the effect of which on financial markets is such as to make it, in the sole
judgment of the Lead Managers, impractical or inadvisable to proceed with the
offering or delivery of the International Securities as contemplated by the
International Prospectus (exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers, of the Selling Stockholder and of the Managers set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Manager, the
Selling Stockholder or the Company or any of the officers, directors or
controlling persons referred to in Section 8 hereof, and will survive delivery
of and payment for the International Securities. The provisions of Sections 7
and 8 hereof shall survive the termination or cancelation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Lead Managers, will be mailed,
delivered or telefaxed to the Xxxxxxx Xxxxx Barney General Counsel (fax no.:
(000) 000-0000) and confirmed to the General Counsel at 000 Xxxxxxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: General Counsel; or, if sent
to the Company, will be mailed, delivered or telefaxed to the Legal Department
(fax no.: (000) 000-0000) and confirmed to it at 000 X. Xxxxxxxxx Xxxxx Xxxxx,
Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, Attention: Legal Department; or, if sent to
the Selling Stockholder, will be mailed, delivered or telefaxed to Xxxxx Fargo
Bank (fax no.: (000) 000-0000) and confirmed to it at 000 Xxxxxxxxxx Xxxxxx, 0xx
Xxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxx XxXxxxxx, and to the
Executive Director (fax no.: (000) 000-0000) and confirmed to it at 0000
Xxxxxxxxxxx Xxxxx, Xxxx X, Xxxxxxxx Xxxxxxx, Xxxx 00000, Attention: Xxxxx X.
Xxxx Executive Director.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and
26
controlling persons referred to in Section 8 hereof, and no other person will
have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in one or more counter
parts, each of which shall constitute an original and all of which together
shall constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this Agreement,
shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the rules
and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City.
"Class B Stock" shall mean the Class B Common Stock, $0.10 par value
per share, of the Company.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any Rule
462(b) Registration Statement became or become effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"International Preliminary Prospectus" shall mean any preliminary
prospectus with respect to the offering of the International Securities
referred to in Section 1(i)(a) above and any preliminary prospectus with
respect to the offering of the International Securities included in the
Registration Statement at the Effective Date that omits Rule 430A
Information.
"Preliminary Prospectus" shall mean the U.S. Preliminary Prospectus or
the International Preliminary Prospectus, as the case may be.
"Registration Statement" shall mean the registration statement
referred to in Section 1(i)(a) above, including exhibits and financial
statements, as amended
27
at the Execution Time (or, if not effective at the Execution Time, in the
form in which it shall become effective) and, in the event any post-
effective amendment thereto or any Rule 462(b) Registration Statement
becomes effective prior to the Closing Date, shall also mean such
registration statement as so amended or such Rule 462(b) Registration
Statement, as the case may be. Such term shall include any Rule 430A
Information deemed to be included therein at the Effective Date as provided
by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules under the
Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b) relating
to the offering covered by the registration statement referred to in
Section 1(i)(a) hereof.
"Xxxxxxx Xxxxx Xxxxxx" shall mean Xxxxx Xxxxxx Inc. or Salomon
Brothers Inc, to the extent that either such party is a signatory to this
Agreement.
"U.S." or "United States" shall mean the United States of America
(including the states thereof and the District of Columbia), its
territories, its possessions and other areas subject to its jurisdiction.
"United States or Canadian Person" shall mean any person who is a
national or resident of the United States or Canada, any corporation,
partnership or other entity created or organized in or under the laws of
the United States or Canada or of any political subdivision thereof, or any
estate or trust the income of which is subject to United States or Canadian
Federal income taxation, regardless of its source (other than any non-
United States or Non-Canadian branch of any United States or Canadian
Person), and shall include any United States or Canadian branch of a person
other than a United States or Canadian Person.
"U.S. Preliminary Prospectus" shall mean any preliminary prospectus
with respect to the offering of the U.S. Securities referred to in Section
1(i)(a) above and any preliminary prospectus with respect to the offering
of the U.S. Securities included in the Registration Statement at the
Effective Date that omits Rule 430A Information.
28
18. Scope of Agreement. This Agreement shall in no way be interpreted
to amend, alter or suspend the terms and provisions of the Registration Rights
Agreement with respect to the rights and obligations of the Company and the
Selling Stockholder vis-a-vis each other, but not with respect to the rights of
the Managers pursuant to this Agreement.
29
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company, the Selling Stockholder and the several Managers.
Very truly yours,
Navistar International Corporation
By:
----------------------------------
Name:
Title:
Navistar International Transportation Corp.
Retiree Supplemental Benefit Trust
By: Xxxxx Fargo, N.A., as Trustee
By:
----------------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxx Xxxxxx Inc.
Credit Suisse First Boston
(Europe) Limited
X.X. Xxxxxx Securities Ltd.
By: Xxxxx Xxxxxx Inc.
By:
-----------------------
Name:
Title:
For itself and the other
several Managers named in
Schedule I to the foregoing
Agreement.
SCHEDULE I
----------
Managers Number of International
-------- --------------------------
Securities to be Purchased
--------------------------
Xxxxx Xxxxxx Inc.............................
Credit Suisse First Boston (Europe) Limited..
X.X. Xxxxxx Securities Ltd...................
-------------
Total................................... 4,000,000,000
=============
EXHIBIT A
[Letterhead of officer or director]
Navistar International Corporation
----------------------------------
Public Offering of Common Stock
-------------------------------
May [ ], 1998
Xxxxx Xxxxxx Inc.
Credit Suisse First Boston Corporation and
Credit Suisse First Boston (Europe) Limited
X.X. Xxxxxx Securities Inc. and X.X. Xxxxxx Securities Ltd.
As U.S. Representatives and Lead Managers of the several Underwriters,
c/o Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
U.S. Underwriting Agreement and International Underwriting Agreement (together,
the "Underwriting Agreements"), among Navistar International Corporation, a
Delaware corporation (the "Company"), the Navistar International Transportation
Corp. Retiree Supplemental Benefit Trust and each of you as representatives or
managers, as the case may be, of a group of U.S. Underwriters or International
Managers (together, the "Underwriters") named therein, relating to an
underwritten public offering of Common Stock, $0.10 par value per share (the
"Common Stock"), of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreements, the undersigned will not, without the prior written
consent of Xxxxx Xxxxxx Inc., offer, sell, contract to sell, pledge or otherwise
dispose of, directly or indirectly, or file (or participate in the filing of) a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
shares of capital stock of the Company or any securities convertible into or
exercisable or exchangeable for such capital stock, or publicly announce an
intention to effect any such transaction, for the period beginning on the date
of the Underwriting Agreements and ending on August 14, 1998, other than shares
of Common Stock disposed of as bona fide gifts approved by Xxxxx Xxxxxx Inc. It
is understood that (i) the undersigned may at any time exercise options
exercisable into shares of Common Stock without the prior written consent of
Xxxxx Xxxxxx Inc., provided that the shares received upon such exercise are held
by the undersigned subject to the terms of this agreement and (ii) you and the
other Underwriters will agree with the Company in the Underwriting Agreements to
permit an aggregate of 200,000 shares of Common Stock to be sold, pledged or
otherwise disposed of by the officers or directors of the Company or Navistar
International Transportation Corp. during the period referred to above.
2
The undersigned hereby represents and warrants that he/she has sold,
pledged or otherwise disposed of [ ] shares of the capital stock of the Company
or any securities convertible into or exercisable or exchangeable for such
capital stock (including pursuant to option exercises) during the period between
May 1, 1998 and the date hereof, inclusive.
If for any reason the Underwriting Agreements shall be terminated
prior to the Closing Date (as defined in the Underwriting Agreements), the
agreement set forth above shall likewise be terminated.
Yours very truly,
[Signature of officer or director]
[Name and address of officer or director]
