EXHIBIT 4.2
EXECUTION COPY
$190,000,000
NAVISTAR INTERNATIONAL CORPORATION
2 1/2% SENIOR CONVERTIBLE NOTES DUE DECEMBER 15, 2007
REGISTRATION RIGHTS AGREEMENT
December 16, 2002
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
Navistar International Corporation, a Delaware corporation (the "ISSUER" ),
proposes to issue and sell to Credit Suisse First Boston Corporation (the
"PURCHASER"), upon the terms set forth in a purchase agreement, dated as of
December 11, 2002 (the "PURCHASE AGREEMENT"), $190,000,000 aggregate principal
amount of its 2 1/2% Senior Convertible Notes Due December 15, 2007 (the
"INITIAL SECURITIES"). The Initial Securities will be unconditionally guaranteed
(the "GUARANTEE") on a senior basis by International Truck and Engine
Corporation, a Delaware corporation (the "GUARANTOR" and, together with the
Issuer, the "COMPANY"). The Initial Securities will be convertible into shares
of common stock, par value $0.10 per share, of the Company (the "COMMON STOCK")
at a conversion price of approximately $34.7100 per share as described in the
Offering Circular, dated as of December 11, 2002 and relating to the offering of
the Initial Securities (the "OFFERING CIRCULAR"). The Initial Securities will be
issued pursuant to an Indenture, dated even date herewith (the "INDENTURE"),
among the Issuer, the Guarantor and BNY Midwest Trust Company, as trustee (the
"TRUSTEE"). As an inducement to the Purchaser to enter into the Purchase
Agreement, the Company agrees with the Purchaser, for the benefit of (i) the
Purchaser and (ii) the holders of the Initial Securities and the Common Stock
issuable upon conversion of the Initial Securities (collectively, the
"SECURITIES") from time to time until such time as such Securities have been
sold pursuant to a Shelf Registration Statement (as defined below) (each of the
foregoing a "HOLDER," and collectively, the "HOLDERS"), as follows:
1. SHELF REGISTRATION. (a) The Company shall, at its cost, prepare and, not
later than 90 days following the date of original issuance of the Initial
Securities (the "ISSUE DATE") file with the Securities and Exchange Commission
(the "COMMISSION") and thereafter use its reasonable best efforts to cause to be
declared effective not later than 210 days after the Issue Date a registration
statement on Form S-3 (the "SHELF REGISTRATION STATEMENT") relating to the offer
and sale of the Transfer Restricted Securities (as defined in Section 5 hereof)
by the Holders thereof from time to time in accordance with the methods of
distribution set forth in the Shelf Registration Statement and Rule 415 under
the Securities Act of 1933, as amended (the "SECURITIES ACT") (hereinafter, the
"SHELF REGISTRATION"); PROVIDED, HOWEVER, that no Holder (other than the
Purchaser) shall be entitled to have the Securities held by it covered by such
Shelf Registration Statement unless such Xxxxxx agrees in writing to be bound by
all the provisions of this Agreement applicable to such Holder.
(b) The Company shall use its reasonable best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the prospectus
included therein (the "PROSPECTUS") to be lawfully delivered by the Holders of
the relevant Securities, for a period of two years (or for such longer period if
extended pursuant to Section 2(i) below) from the Issue Date or such shorter
period that will terminate when all the Securities covered by the Shelf
Registration Statement (i) have been sold pursuant thereto or (ii) are eligible
to be sold to the public pursuant to Rule 144(k) under the Securities Act, or
any successor rule thereof, without limitations under clauses (c), (e), (f) or
(h) of Rule 144 under the Securities Act or any successor provisions thereof,
assuming for this purpose that the Holders thereof are not affiliates of the
Company (in any such case, such period being called the "SHELF REGISTRATION
PERIOD"). The Company shall be deemed not to have used its reasonable best
efforts to keep the Shelf Registration Statement effective during the requisite
period if it voluntarily takes any action that would result in Holders of
Securities covered thereby not being able to offer and sell such Securities
during that period, unless such action is (i) required by applicable law or the
rules, regulations and policies of the Commission or (ii) taken by the Company
in good faith and as contemplated by Section 2(c)(v) below, and the Company
thereafter complies with the requirements of Section 2(i).
(c) Notwithstanding any other provisions of this Agreement to the contrary,
the Company shall cause the Shelf Registration Statement and the Prospectus and
any amendment or supplement thereto, as of the effective date of the Shelf
Registration Statement, amendment or supplement, (i) to comply in all material
respects with the applicable requirements of the Securities Act and the rules
and regulations of the Commission and (ii) not to contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
2. REGISTRATION PROCEDURES. In connection with the Shelf Registration
contemplated by Section 1 hereof, the following provisions shall apply:
(a) The Company shall give reasonable written notice of its intention to
file the Shelf Registration Statement pursuant to Section 1 hereof (a "FILING
NOTICE") to each Holder of Initial Securities and the Common Stock issuable upon
conversion of the Initial Securities in the manner provided for notice to
Holders of the Initial Securities as set forth in the Indenture, which Filing
Notice shall request (i) that each such Holder provide written notice to the
Company of such Holder's election to have the Initial Securities and the Common
Stock issuable upon conversion of the Initial Securities held by such Holder
registered for resale pursuant to the Shelf Registration Statement and (ii) that
any such Holder that intends to have registered pursuant to the Shelf
Registration Statement any Securities held by it provide a completed Notice and
Questionnaire pursuant to Section 2(n) below.
(b) The Company shall (i) furnish to the Purchaser, prior to the filing
thereof with the Commission, a copy of the Shelf Registration Statement and each
amendment thereof and each supplement, if any, to the Prospectus included
therein and, in the event that the Purchaser (with respect to any portion of an
unsold allotment from the original offering) is participating in the Shelf
Registration Statement, shall use its reasonable best efforts to reflect in each
such document, when so filed with the Commission, such comments as the Purchaser
reasonably may propose; and (ii) include the names of the Holders who propose to
sell Securities pursuant to the Shelf Registration Statement as selling
securityholders to the extent such Holders have furnished the Company with any
information required to be disclosed in the Shelf Registration Statement.
(c) The Company shall give written notice to the Purchaser and the Holders
of the Securities (which notice pursuant to clauses (ii)-(v) hereof shall be
accompanied by an instruction to suspend the use of the Prospectus until the
requisite changes have been made):
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(i) when the Shelf Registration Statement or any amendment thereto has
been filed with the Commission and when the Shelf Registration Statement or
any post-effective amendment thereto has become effective;
(ii) of any request by the Commission for amendments or supplements to
the Shelf Registration Statement or the Prospectus included therein or for
additional information;
(iii) of the issuance by the Commission of any stop order suspending
the effectiveness of the Shelf Registration Statement or the initiation of
any proceedings for that purpose;
(iv) of the receipt by the Company or its legal counsel of any
notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose; and
(v) of the happening of any event that requires the Company to make
changes in the Shelf Registration Statement or the Prospectus in order that
the Shelf Registration Statement or the Prospectus does not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
(in the case of the Prospectus, in the light of the circumstances under
which they were made) not misleading.
(d) The Company shall make every reasonable effort to obtain the withdrawal
at the earliest possible time of any order suspending the effectiveness of the
Shelf Registration Statement.
(e) The Company shall furnish to each Holder of Securities included within
the coverage of the Shelf Registration, without charge, at least one copy of the
Shelf Registration Statement and any post-effective amendment thereto, including
financial statements and schedules, and, if the Holder so requests in writing,
all exhibits thereto (including those, if any, incorporated by reference).
(f) The Company shall, during the Shelf Registration Period, deliver to
each Holder of Securities included within the coverage of the Shelf
Registration, without charge, as many copies of the Prospectus (including each
preliminary prospectus) included in the Shelf Registration Statement and any
amendment or supplement thereto as such person may reasonably request. The
Company consents, subject to the provisions of this Agreement, to the use of the
Prospectus or any amendment or supplement thereto by each of the selling Holders
of the Securities in connection with the offering and sale of the Securities
covered by the Prospectus, or any amendment or supplement thereto, included in
the Shelf Registration Statement.
(g) Prior to any public offering of the Securities pursuant to the Shelf
Registration Statement, the Company shall register or qualify or cooperate with
the Holders of the Securities included therein and their respective counsel in
connection with the registration or qualification of the Securities for offer
and sale under the securities or "blue sky" laws of such states of the United
States as any Holder of the Securities reasonably requests in writing and do any
and all other acts or things necessary or advisable to enable the offer and sale
in such jurisdictions of the Securities covered by such Shelf Registration
Statement; PROVIDED, HOWEVER, that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction where it is not then so
qualified or (ii) take any action which would subject it to general service of
process or to taxation in any jurisdiction where it is not then so subject.
(h) The Company shall cooperate with the Holders of the Securities to
facilitate the timely preparation and delivery of certificates representing the
Securities to be sold pursuant to any Registration Statement free of any
restrictive legends and in such denominations and registered in such names as
the Holders may request a reasonable period of time prior to sales of the
Securities pursuant to the Shelf Registration Statement.
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(i) Upon the occurrence of any event contemplated by paragraphs (ii)
through (v) of Section 2(c) above during the period for which the Company is
required to maintain an effective Shelf Registration Statement, the Company
shall promptly prepare and file a post-effective amendment to the Shelf
Registration Statement or an amendment or supplement to the Prospectus and any
other required document so that, as thereafter delivered to Holders or
purchasers of the Securities, the Prospectus will not contain an untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; PROVIDED, HOWEVER,
that the Company may delay filing and distributing any such supplement or
amendment (and continue the suspension of the use of the Prospectus) if the
Company determines in good faith that such supplement or amendment would, in the
reasonable judgment of the Company, (i) interfere with or affect the negotiation
or completion of a transaction that is being contemplated by the Company or (ii)
involve initial or continuing disclosure obligations that are not in the best
interests of the Company's stockholders at such time; PROVIDED, FURTHER, that
neither such delay nor such suspension shall extend for a period of more than 30
consecutive days or an aggregate of 60 days in any twelve-month period. If the
Company notifies the Purchaser and the Holders in accordance with paragraphs
(ii) through (v) of Section 2(c) above to suspend the use of the Prospectus
until the requisite changes to the Prospectus have been made, then the Purchaser
and the Holders shall suspend use of such Prospectus, and the period of
effectiveness of the Shelf Registration Statement provided for in Section 1(b)
above shall be extended by the number of days from and including the date of the
giving of such notice to and including the date when the Purchaser and the
Holders shall have received such amended or supplemented Prospectus pursuant to
this Section 2(i).
(j) Not later than the effective date of the Shelf Registration Statement,
the Company will provide CUSIP numbers for the Securities registered under the
Shelf Registration Statement, and provide the Trustee with printed certificates
for the Initial Securities, in a form eligible for deposit with The Depository
Trust Company.
(k) The Company will comply with all rules and regulations of the
Commission to the extent and so long as they are applicable to the Shelf
Registration and will make generally available to its security holders (or
otherwise provide in accordance with Section 11(a) of the Securities Act) an
earnings statement satisfying the provisions of Section 11(a) of the Securities
Act, no later than 45 days after the end of a 12-month period (or 90 days, if
such period is a fiscal year) beginning with the first month of the Company's
first fiscal quarter commencing after the effective date of the Shelf
Registration Statement, which statement shall cover such 12-month period.
(l) The Company shall cause the Indenture to be qualified under the Trust
Indenture Act of 1939, as amended, (the "TRUST INDENTURE ACT") in a timely
manner and containing such changes, if any, as shall be necessary for such
qualification. In the event that such qualification would require the
appointment of a new trustee under the Indenture, the Company shall appoint a
new trustee thereunder pursuant to the applicable provisions of the Indenture.
(m) Each Holder agrees, by acquisition of the Securities, that no Holder
shall be entitled to sell any such Securities pursuant to the Shelf Registration
Statement or to receive a prospectus relating thereto, unless such Holder has
furnished the Company with a Notice and Questionnaire as required pursuant to
Section 2(n) hereof and the information set forth in the next sentence. Each
Holder agrees promptly to furnish the Company all information required to be
disclosed in order to make the information previously furnished to the Company
by such Holder not misleading and any other information regarding such Holder
and the distribution of such Securities as the Company may from time to time
reasonably request.
(n) Each Holder agrees that if such Holder wishes to sell such Xxxxxx's
Securities pursuant to the Shelf Registration Statement and related Prospectus,
it will do so in accordance with this Section 2(n). Each Holder wishing to sell
Securities pursuant to a Shelf Registration Statement and related Prospectus
agrees to
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deliver a properly completed and signed Notice and Questionnaire (the form of
which is included as Annex A to the Offering Circular) (the "NOTICE AND
QUESTIONNAIRE") to the Company prior to any intended distribution of Securities
under the Shelf Registration Statement. From and after the date the Shelf
Registration Statement is declared effective, the Company shall, as promptly as
is practicable after the date a Notice and Questionnaire is delivered, and in
any event within ten (10) business days after such date, (i) if required by law,
file with the Commission a post-effective amendment to the Shelf Registration
Statement or prepare and, if required by applicable law, file a supplement to
the related Prospectus or a supplement or amendment to any document incorporated
therein by reference or file any other required document so that the Holder
delivering such Notice and Questionnaire is named a selling securityholder in
the Shelf Registration Statement and the related Prospectus in such a manner as
to permit such Holder to deliver such Prospectus to purchasers of the Securities
in accordance with applicable law and, if the Company shall file a
post-effective amendment to the Shelf Registration Statement, use all reasonable
efforts to cause such post-effective amendment to be declared effective under
the Securities Act as promptly as practical, but in any event by the date that
is thirty (30) business days after the date such post-effective amendment is
required by this clause to be filed; (ii) provide such Holder copies of any
documents filed pursuant to this Section; and (iii) notify such Holder as
promptly as practicable after the effectiveness under the Securities Act of any
post-effective amendment filed pursuant to this Section; PROVIDED, that if such
Notice and Questionnaire is delivered during a period in which the use of such
Prospectus is suspended pursuant to Section 2(d) hereof, the Company shall so
inform the Holder delivering such Notice and Questionnaire and shall take the
actions set forth in clauses (i), (ii) and (iii) above upon expiration of such
suspension period. Notwithstanding anything contained herein to the contrary,
the Company shall be under no obligation to name any Holder that has not
supplied the requisite information required by this Section as a selling
securityholder in the Shelf Registration Statement and related Prospectus and
any amendment or supplement thereto; PROVIDED, HOWEVER, that any Holder that has
subsequently supplied the requisite information required by this Section
pursuant to the provisions of this Section (whether or not such Holder has
supplied the requisite information required by this Section at the time the
Shelf Registration Statement was declared effective) shall be named as a selling
securityholder in the Shelf Registration Statement or related Prospectus in
accordance with the requirements of this Section. Notwithstanding anything
contained herein to the contrary, the Company shall not be required to file more
than one post-effective amendment or supplement for the purpose of naming
selling security holders in any seven-day period.
(o) The Company shall enter into such customary agreements (including, if
requested, an underwriting agreement in customary form) and take all such other
actions, if any, as Holders of a majority in aggregate principal amount of
Securities being sold or the managing underwriter, if any, shall reasonably
request in order to facilitate the disposition of the Securities pursuant to the
Shelf Registration.
(p) The Company shall (i) make reasonably available for inspection by the
Holders, any underwriter participating in any disposition pursuant to the Shelf
Registration Statement and any attorney, accountant or other agent retained by
the Holders or any such underwriter, all relevant financial and other records,
pertinent corporate documents and properties of the Company and (ii) cause the
Company's officers, directors, employees, accountants and auditors to supply all
relevant information reasonably requested by the Holders or any such
underwriter, attorney, accountant or agent in connection with the Shelf
Registration Statement, in each case, as shall be reasonably necessary to enable
such persons, to conduct a reasonable investigation within the meaning of
Section 11 of the Securities Act; PROVIDED, HOWEVER, that the foregoing
inspection and information gathering shall be coordinated on behalf of Holders
other than the Purchaser by one counsel designated by and on behalf of such
other parties as described in Section 3 hereof.
(q) In the event of an underwritten offering, the Company shall use
reasonable best efforts to cause (i) its counsel to deliver an opinion and
updates thereof relating to the Securities in customary form addressed to such
Holders and the managing underwriters, if any, thereof, and dated, in the case
of the initial opinion, the effective date of such Shelf Registration Statement;
(ii) its officers to execute and deliver all customary documents and
certificates and updates thereof requested by any underwriters of the
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Securities and (iii) its independent public accountants and the independent
public accountants with respect to any other entity for which financial
information is provided in the Shelf Registration Statement to provide to the
selling Holders of the applicable Securities and any underwriter therefor a
comfort letter in customary form and covering matters of the type customarily
covered in comfort letters in connection with primary underwritten offerings,
subject to receipt of appropriate documentation as contemplated, and only if
permitted, by Statement of Auditing Standards No. 72.
(r) The Company will use its reasonable best efforts to (a) if the Initial
Securities have been rated prior to the initial sale of such Initial Securities,
confirm such ratings will apply to the Securities covered by a Shelf
Registration Statement, or (b) if the Initial Securities were not previously
rated, cause the Securities covered by a Shelf Registration Statement to be
rated with the appropriate rating agencies, if so requested by Holders of a
majority in aggregate principal amount of Securities covered by the Shelf
Registration Statement, or by the managing underwriters, if any.
(s) In the event that any broker-dealer registered under the Exchange Act
shall underwrite any Securities or participate as a member of an underwriting
syndicate or selling group or "assist in the distribution" (within the meaning
of the Conduct Rules (the "RULES") of the National Association of Securities
Dealers, Inc. ("NASD")) thereof, whether as a Holder of such Securities or as an
underwriter, a placement or sales agent or a broker or dealer in respect
thereof, or otherwise, the Company will assist such broker-dealer in complying
with the requirements of such Rules, including, without limitation, by (i) if
such Rules, including Rule 2720, shall so require, engaging a "qualified
independent underwriter" (as defined in Rule 2720) to participate in the
preparation of the Shelf Registration Statement relating to such Securities, to
exercise usual standards of due diligence with respect thereto and, if any
portion of the offering contemplated by such Shelf Registration Statement is an
underwritten offering or is made through a placement or sales agent, to
recommend the yield of such Securities, (ii) indemnifying any such qualified
independent underwriter to the extent of the indemnification of underwriters
provided in Section 5 hereof and (iii) providing such information to such
broker-dealer as may be required in order for such broker-dealer to comply with
the requirements of the Rules.
3. REGISTRATION EXPENSES. (a) All expenses incident to the Company's
performance of and compliance with this Agreement will be borne by the Company,
regardless of whether a Shelf Registration Statement is ever filed or becomes
effective, including without limitation;
(i) all registration and filing fees and expenses;
(ii) all fees and expenses of compliance with federal securities and
state "blue sky" or securities laws;
(iii) all expenses of printing (including printing certificates for
the Securities to be issued and printing of prospectuses), messenger and
delivery services and telephone;
(iv) all fees and disbursements of counsel for the Company;
(v) all application and filing fees in connection with listing the
Securities on a national securities exchange or automated quotation system
pursuant to the requirements hereof; and
(vi) all fees and disbursements of independent certified public
accountants of the Company (including the expenses of any special audit and
comfort letters required by or incident to such performance).
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The Company will bear its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees and expenses
of any person, including special experts, retained by the Company.
(b) In connection with the Shelf Registration Statement required by this
Agreement, the Company will reimburse the Purchaser and the Holders of
Securities covered by the Shelf Registration Statement for the reasonable fees
and disbursements of not more than one counsel, designated by the Holders of a
majority in principal amount of the Securities covered by the Shelf Registration
Statement (provided that Holders of Common Stock issued upon the conversion of
the Initial Securities shall be deemed to be Holders of the aggregate principal
amount of Initial Securities from which such Common Stock was converted) to act
as counsel for the Holders in connection therewith.
4. INDEMNIFICATION. (a) The Company agrees to indemnify and hold harmless
each Holder and each person, if any, who controls such Holder within the meaning
of the Securities Act or the Exchange Act (each Holder, and such controlling
persons are referred to collectively as the "INDEMNIFIED PARTIES") from and
against any losses, claims, damages or liabilities, joint or several, or any
actions in respect thereof (including, but not limited to, any losses, claims,
damages, liabilities or actions relating to purchases and sales of the
Securities) to which each Indemnified Party may become subject under the
Securities Act, the Exchange Act, any other federal or state regulatory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages,
liabilities or actions arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the Shelf Registration
Statement or Prospectus, including any document incorporated by reference
therein, or in any amendment or supplement thereto or in any preliminary
prospectus relating to the Shelf Registration, 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, in the light
of the circumstances under which they were made, not misleading, and shall
reimburse, as incurred, the Indemnified Parties for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action in respect thereof; PROVIDED,
HOWEVER, that (i) the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in the Shelf Registration Statement or Prospectus or in any amendment or
supplement thereto or in any preliminary prospectus relating to the Shelf
Registration in reliance upon and in conformity with written information
pertaining to such Holder and furnished to the Company by or on behalf of such
Holder specifically for inclusion therein and (ii) with respect to any untrue
statement or omission or alleged untrue statement or omission made in any
preliminary prospectus relating to the Shelf Registration Statement, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Holder from whom the person asserting any such losses, claims,
damages or liabilities purchased the Securities concerned, to the extent that a
prospectus relating to such Securities was required to be delivered by such
Holder under the Securities Act in connection with such purchase and any such
loss, claim, damage or liability of such Holder results from the fact that there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Securities to such person, a copy of the final Prospectus if
the Company had previously furnished copies thereof to such Holder; PROVIDED
FURTHER, HOWEVER, that this indemnity agreement will be in addition to any
liability which the Company may otherwise have to such Indemnified Party.
(b) Each Holder, severally and not jointly, will indemnify and hold
harmless the Company, its officers and directors and each person, if any, who
controls the Company within the meaning of the Securities Act or the Exchange
Act from and against any losses, claims, damages or liabilities or any actions
in respect thereof, to which the Company or any such controlling person may
become subject under the Securities Act, the Exchange Act, any other federal or
state regulatory law or regulation, at common law, or otherwise, insofar as such
losses, claims, damages, liabilities or actions arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Shelf Registration Statement or Prospectus or in any amendment or supplement
thereto or in any preliminary prospectus relating to the
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Shelf Registration, or arise out of or are based upon the omission or alleged
omission to state therein a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, but in each case only to the extent that the untrue statement or
omission or alleged untrue statement or omission was made in reliance upon and
in conformity with written information pertaining to such Holder and furnished
to the Company by or on behalf of such Holder specifically for inclusion
therein; and, subject to the limitation set forth immediately preceding this
clause, shall reimburse, as incurred, the Company for any legal or other
expenses reasonably incurred by the Company or any such controlling person in
connection with investigating or defending any loss, claim, damage, liability or
action in respect thereof. This indemnity agreement will be in addition to any
liability which such Holder may otherwise have to the Company or any of its
controlling persons.
(c) Promptly after receipt by an indemnified party under this Section 4 of
notice of the commencement of any action or proceeding (including a governmental
investigation), such indemnified party will, if a claim in respect thereof is to
be made against the indemnifying party under this Section 4, notify the
indemnifying party of the commencement thereof; but the failure to notify the
indemnifying party shall not relieve it from any liability that it may have
under subsection (a) or (b) above except to the extent that it has been
materially prejudiced (through the forfeiture of substantive rights or defenses)
by such failure; and PROVIDED FURTHER that the failure to notify the
indemnifying party shall not relieve it from any liability that it may have to
an indemnified party otherwise than under subsection (a) or (b) above. In case
any such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section 4 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement (i) includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action, and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 4 is unavailable or
insufficient to hold harmless an indemnified party under subsections (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to in subsection (a) or (b)
above in such proportion as is appropriate to reflect the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on the
other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof) as well
as any other relevant equitable considerations. The relative fault of the
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand or such Holder or such other indemnified party, as the case may
be, on the other, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities referred to in the first sentence of this subsection (d)
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any action
or claim which is the subject of this subsection (d). Notwithstanding any other
provision of this Section 4(d), the Holders shall not be required to contribute
any amount in excess of the amount by which the net proceeds received by such
Holders from the sale of the Securities pursuant to the Shelf Registration
Statement exceeds the amount of
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damages which such Holders have otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this paragraph
(d), each person, if any, who controls such indemnified party within the meaning
of the Securities Act or the Exchange Act shall have the same rights to
contribution as such indemnified party and each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act shall have
the same rights to contribution as the Company.
(e) The agreements contained in this Section 4 shall survive the sale of
the Securities pursuant to the Shelf Registration Statement and shall remain in
full force and effect, regardless of any termination or cancelation of this
Agreement or any investigation made by or on behalf of any indemnified party.
5. ADDITIONAL INTEREST UNDER CERTAIN CIRCUMSTANCES. (a) Additional interest
(the "ADDITIONAL INTEREST") with respect to the Initial Securities and the
underlying shares of Common Stock that are registrable securities shall be
assessed as follows if any of the following events occur (each such event in
clauses (i) through (iii) below being herein called a "REGISTRATION DEFAULT"):
(i) the Shelf Registration Statement has not been filed with the
Commission by the 90th day after the Issue Date;
(ii) the Shelf Registration Statement has not been declared effective
by the Commission by the 210th day after the Issue Date; or
(iii) the Shelf Registration Statement is declared effective, and such
Shelf Registration Statement ceases to be effective or fails to be usable
in connection with resales of Transfer Restricted Securities in accordance
with and during the periods specified in this Agreement and (A) the Company
does not cure the Shelf Registration Statement within five business days by
a post-effective amendment or a report filed pursuant to the Exchange Act
or (B) if applicable, the Company does not terminate the suspension period
described above by the 30th or 60th days, as the case may be.
Each of the foregoing will constitute a Registration Default whatever the reason
for any such event and whether it is voluntary or involuntary or is beyond the
control of the Company or pursuant to operation of law or as a result of any
action or inaction by the Commission.
Additional Interest shall accrue on the Initial Securities and the
underlying shares of Common Stock that are registrable securities over and above
the interest set forth in the title of the Initial Securities from and including
the date on which any such Registration Default shall occur to but excluding the
date on which all such Registration Defaults have been cured, at a rate of 0.50%
per annum for the Initial Securities (or an equivalent amount for any shares of
Common Stock issued upon conversion of the Initial Securities) (the "ADDITIONAL
INTEREST RATE"). With respect to each Holder, the obligation of the Company to
pay Additional Interest shall remain in effect only so long as the Initial
Securities and the Common Stock issuable upon conversion of the Initial
Securities held by such Holder are Transfer Restricted Securities (as defined
below).
(b) A Registration Default referred to in Section 5(a)(iii) hereof shall be
deemed not to have occurred and be continuing in relation to the Shelf
Registration Statement or the related Prospectus if (i) such Registration
Default has occurred solely as a result of (x) the filing of a post-effective
amendment to the Shelf Registration Statement to incorporate annual audited
financial information with respect to the Company where such post-effective
amendment is not yet effective and needs to be declared effective to permit
Holders to use the related Prospectus or (y) other material events with respect
to the Company that
9
would need to be described in such Shelf Registration Statement or the related
Prospectus and (ii) in the case of clause (y), the Company is proceeding
promptly and in good faith to amend or supplement the Shelf Registration
Statement and related Prospectus to describe such events as required by
paragraph 2(h) hereof; PROVIDED, HOWEVER, that in any case if such Registration
Default occurs for a continuous period in excess of 30 days, Additional Interest
shall be payable in accordance with the above paragraph from the day such
Registration Default occurs until such Registration Default is cured.
(c) Any amounts of Additional Interest due pursuant to Section 5(a) will be
payable in the manner of payment of interest on the Initial Securities pursuant
to the Indenture. The amount of Additional Interest will be determined by
multiplying the Additional Interest Rate by the principal amount of the Initial
Securities (plus, with respect to any shares of Common Stock issued upon
conversion of Initial Securities, the principal amount of the Initial Securities
from which such shares were converted), further multiplied by a fraction, the
numerator of which is the number of days such Additional Interest Rate was
applicable during such period (determined on the basis of a 360-day year
comprised of twelve 30-day months), and the denominator of which is 360.
(d) "TRANSFER RESTRICTED SECURITIES" means each Security until (i) the date
on which such Security has been effectively registered under the Securities Act
and disposed of in accordance with the Shelf Registration Statement or (ii) the
date on which such Security is distributed to the public pursuant to Rule 144
under the Securities Act or is saleable pursuant to Rule 144(k) under the
Securities Act.
6. RULES 144 AND 144A. The Company shall use its best efforts to file the
reports required to be filed by it under the Securities Act and the Exchange Act
in a reasonably timely manner and, if at any time the Company is not required to
file such reports, it will, upon the request of any Holder, make publicly
available other information so long as necessary to permit sales of their
securities pursuant to Rules 144 and 144A. The Company covenants that it will
take such further action as any Holder may reasonably request, all to the extent
required from time to time to enable such Holder to sell Transfer Restricted
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rules 144 and 144A (including the requirements of
Rule 144A(d)(4)). The Company will provide a copy of this Agreement to
prospective purchasers of Securities identified to the Company by the Purchaser
upon request. Upon the written request of any Holder, the Company shall deliver
to such Holder a written statement as to whether it has complied with such
requirements. Notwithstanding the foregoing, nothing in this Section 6 shall be
deemed to require the Company to register any of its securities pursuant to the
Exchange Act.
7. UNDERWRITTEN REGISTRATIONS. The Holders of a majority in aggregate
principal amount of the Transfer Restricted Securities eligible to be included
in a Shelf Registration Statement may on one occasion request an underwritten
offering. If any of the Transfer Restricted Securities covered by the Shelf
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering
("MANAGING UNDERWRITERS") will be selected by the Holders of a majority in
aggregate principal amount of such Transfer Restricted Securities to be included
in such offering (provided that Holders of Common Stock issued upon conversion
of the Initial Securities shall not be deemed Holders of Common Stock, but shall
be deemed to be Holders of the aggregate principal amount of Initial Securities
from which such Common Stock was converted).
No person may participate in any underwritten registration hereunder unless
such person (i) agrees to sell such person's Transfer Restricted Securities on
the basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
10
8. MISCELLANEOUS.
(a) REMEDIES. The Company acknowledges and agrees that any failure by the
Company to comply with its obligations under Section 1 hereof may result in
material irreparable injury to the Purchaser or the Holders for which there is
no adequate remedy at law, that it will not be possible to measure damages for
such injuries precisely and that, in the event of any such failure, the
Purchaser or any Holder may obtain such relief as may be required to
specifically enforce the Company's obligations under Section 1 hereof. The
Company further agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Company will not on or after the date
of this Agreement enter into any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of the Company's securities under any
agreement in effect on the date hereof.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the Company with the written
consent of the Holders of a majority in principal amount of the Securities
affected by such amendment, modification, supplement, waiver or consent
(provided that Holders of Common Stock issued upon conversion of Initial
Securities shall not be deemed Holders of Common Stock, but shall be deemed to
be Holders of the aggregate principal amount of Initial Securities from which
such Common Stock was converted). Without the consent of the Holder of each
Initial Security, however, no modification may change the provisions relating to
the payment of Additional Interest.
(d) NOTICES. Except as otherwise provided herein, all notices and other
communications provided for or permitted hereunder shall be made in writing by
hand delivery, first-class mail, facsimile transmission, or air courier which
guarantees overnight delivery:
(1) if to a Holder of the Securities, at the most current address
given by such Holder to the Company.
(2) if to the Purchaser:
Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Fax No.: (000) 000-0000
Attention: Transactions Advisory Group
with a copy to:
Xxxxxxx, Swaine & Xxxxx
Worldwide Plaza
000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000-7475
Fax No.: (000) 000-0000
Attn.: Xxxx X. Xxxxxxxxxx, Esq.
11
(3) if to the Company, at its address as follows:
Navistar International Corporation
0000 Xxxxxxxx Xx.
P.O. Box 1488
Warrenville, IL 60555
Fax No.: (000) 000-0000
Attn: Xxxxxx X. Xxxxx
with a copy to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
Attn: Xxxxxx X. Xxxxx, Esq.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by recipient's facsimile machine operator, if sent by facsimile
transmission; and on the day delivered, if sent by overnight air courier
guaranteeing next day delivery.
(e) THIRD PARTY BENEFICIARIES. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Purchaser, on the other hand, and shall have the right to enforce
such agreements directly to the extent they may deem such enforcement necessary
or advisable to protect their rights or the rights of Holders hereunder.
(f) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Company and its successors and assigns.
(g) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
By the execution and delivery of this Agreement, the Company submits to the
nonexclusive jurisdiction of any federal or state court in the State of New
York.
(j) SEVERABILITY. If any one or more of the provisions contained herein, or
the application thereof in any circumstance, is held invalid, illegal or
unenforceable, the validity, legality and enforceability of any such provision
in every other respect and of the remaining provisions contained herein shall
not be affected or impaired thereby.
(k) SECURITIES HELD BY THE COMPANY. Whenever the consent or approval of
Holders of a specified percentage of principal amount of Securities is required
hereunder, Securities held by the Company or its
12
affiliates (other than subsequent Holders of Securities if such subsequent
Holders are deemed to be affiliates solely by reason of their holdings of such
Securities) shall not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Issuer a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Purchaser, the Issuer and the Guarantor in accordance with its terms.
Very truly yours,
NAVISTAR INTERNATIONAL CORPORATION
by
/s/ XXXXXX X. XXXXX
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President and Treasurer
INTERNATIONAL TRUCK AND ENGINE CORPORATION, as
Guarantor
by
/s/ XXXXXX X. XXXXX
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President and Treasurer
The foregoing Registration
Rights Agreement is hereby confirmed
and accepted as of the date first
above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
by
/s/ XXXXXXX X. XXXXX
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Managing Director
13
