Exhibit 1.1
USA EDUCATION, INC.
COMMON STOCK
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UNDERWRITING AGREEMENT
As of February 23, 2001
Xxxxxxx, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
From time to time Lumina Foundation for Education, Inc., a private
foundation incorporated under Delaware law, as Selling Shareholder (the "Selling
Shareholder"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to sell to you (the "Underwriters"),
certain shares of Common Stock, $0.20 par value (the "Shares"), of USA
Education, Inc., a Delaware corporation (the "Company"), specified in Schedule I
to such Pricing Agreement (with respect to such Pricing Agreement, the
"Designated Shares").
1. Particular sales of Designated Shares may be made to you from time
to time. This Underwriting Agreement shall not be construed as an obligation of
the Selling Shareholder to sell any of the Shares or as an obligation of the
Underwriters to purchase any of the Shares. The obligation of the Selling
Shareholder to sell any of the Shares and your obligation to purchase any of the
Shares shall be evidenced by the Pricing Agreement with respect to the
Designated Shares specified therein. Each Pricing Agreement shall specify the
aggregate number of Designated Shares, the initial public offering price of such
Designated Shares or the manner of determining such price, the purchase price to
the Underwriters of such Designated Shares, and the commission, if any, payable
to the Underwriters with respect thereto and shall set forth the date, time and
manner of delivery of such Designated Shares, and payment therefor. A Pricing
Agreement shall be in the form of an executed writing (which may be in
counterparts), and may be evidenced by an exchange of telegraphic communications
or any other rapid transmission device designed to produce a written record of
communications transmitted.
2. (a) The Company represents and warrants to, and agrees with, the
Underwriters that:
(i) A registration statement on Form S-3 (File No 333-54642)
(the "Initial Registration Statement") in respect of the Shares has
been filed with the Securities and Exchange Commission (the
"Commission"); the Initial Registration Statement and any pre- or
post-effective amendment thereto, each in the form heretofore delivered
or to be delivered to you excluding exhibits to the Initial
Registration Statement, and all documents incorporated by
reference in the prospectus included therein, have been declared
effective by the Commission in such form; no other document with
respect to the Initial Registration Statement or document incorporated
by reference therein has heretofore been filed, or transmitted for
filing, with the Commission (other than prospectuses filed pursuant to
Rule 424(b) of the rules and regulations of the Commission under the
Securities Act of 1993, as amended (the "Act"), each in the form
heretofore delivered to you); and no stop order suspending the
effectiveness of the Initial Registration Statement or any
post-effective amendment thereto has been issued and no proceeding for
that purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in the Initial Registration Statement
or filed with the Commission pursuant to Rule 424(a) under the Act, is
hereinafter called a "Preliminary Prospectus"; the various parts of the
Initial Registration Statement including all exhibits thereto and the
documents incorporated by reference in the prospectus contained in the
Initial Registration Statement at the time such part of the Initial
Registration Statement became effective, each as amended at the time
such part of the Initial Registration Statement became effective, are
hereinafter collectively called the "Registration Statement"; the
prospectus relating to the Shares, in the form in which it has most
recently been filed, or transmitted for filing, with the Commission on
or prior to the date of this Agreement, is hereinafter called the
"Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to the applicable form under
the Act, as of the date of such Preliminary Prospectus or Prospectus,
as the case may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated
by reference in such Preliminary Prospectus or Prospectus, as the case
may be; any reference to any amendment to the Initial Registration
Statement shall be deemed to refer to and include any annual report of
the Company filed pursuant to Section 13(a) or 15(d) of the Exchange
Act after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed
to refer to the Prospectus as amended or supplemented in relation to
the applicable Designated Shares in the form in which it is filed with
the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof, including any documents incorporated by reference
therein as of the date of such filing);
(ii) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with the
Commission, as the case may be, conformed in all material respects
to the requirements of the Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder, and none
of such documents 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; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the
requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder and will 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 not misleading;
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PROVIDED, HOWEVER, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by
you or by the Selling Shareholder expressly for use in the
Prospectus as amended or supplemented relating to such Shares;
(iii) The Registration Statement and the Prospectus conform,
and any further amendments or supplements to the Registration Statement
or the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of
the applicable filing date as to the Prospectus and any amendment or
supplement thereto, 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 not misleading; PROVIDED,
HOWEVER, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by you expressly for
use in the Prospectus as amended or supplemented relating to such
Shares or by a Selling Shareholder expressly for use in the preparation
of the answers in the Prospectus to Item 7 of Form S-3;
(iv) Neither the Company nor any of its subsidiaries has
sustained, since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the
capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus;
(v) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Delaware,
with power and authority (corporate and other) to own, lease and
operate its properties and conduct its business as described in the
Prospectus; and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which its owns or leases properties, or
conducts any business, so as to require such qualification, or is
subject to no material liability or disability by reason of the failure
to be so qualified in any such jurisdiction; and each subsidiary of the
Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation;
(vi) Each subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation with power and authority
(corporate and other) to own, lease and operate its properties and to
conduct its business as described in the Prospectus;
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(vii) Each Subsidiary of the Company has been duly qualified
as a foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require
qualification;
(viii) The Company has an authorized capitalization as set
forth in the Prospectus, all of the issued and outstanding shares of
capital stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable; all of the issued and
outstanding shares of capital stock of each subsidiary of the Company
have been duly and validly authorized and issued, are fully paid and
non-assessable and (except for directors' qualifying shares) are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
(ix) The Shares have been duly and validly authorized and
issued and are fully paid and non-assessable; the Shares conform to the
description thereof contained in the Registration Statement and the
Designated Shares will conform to the description thereof contained in
the Prospectus as amended or supplemented with respect to such
Designated Shares;
(x) The issue and sale of the Shares and the compliance by the
Company with all of the provisions of this Agreement, any Pricing
Agreement, and the consummation of the transactions contemplated herein
and therein will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets of the
Company is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any
of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by this
Agreement or any Pricing Agreement, except such as have been, or will
have been prior to each Time of Delivery (as defined in Section 4
hereof), obtained under the Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under state securities or Blue Sky laws in connection with the purchase
and distribution of the Shares by the Underwriters;
(xi) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject, which, if determined
adversely to the Company or any of its subsidiaries, would individually
or in the aggregate have a material adverse effect on the current or
future consolidated financial position, stockholders' equity or results
of operations of the Company and its subsidiaries; and, to the best of
the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
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(xii) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or in default
in the performance or observance of any material obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which
it is a party or by which it or any of its properties may be bound;
(xiii) Each of the Company and its subsidiaries is in
substantial compliance with, and conducts its business in substantial
conformity with, all applicable laws and governmental regulations;
(xiv) The statements set forth or incorporated by reference in
the Prospectus with respect to the description of the Company's Common
Stock, and under the caption "Plan of Distribution", insofar as they
purport to describe the provisions of the laws and documents referred
to therein, are accurate, complete and fair in all material respects;
(xv) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company",
as such term is defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act");
(xvi) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes; and
(xvii) Xxxxxx Xxxxxxxx LLP, who have certified certain
financial statements of the Company and its subsidiaries are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
(b) The Selling Shareholder represents and warrants to, and
agrees with, the Underwriter and the Company that:
(i) All consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling Shareholder of
this Agreement, the Pricing Agreement, the Power of Attorney and the
Custody Agreement hereinafter referred to, and for the sale and
delivery of the Designated Shares to be delivered by such Selling
Shareholder at each Time of Delivery, have been obtained; and such
Selling Shareholder has full right, power and authority to enter into
this Agreement, the Pricing Agreement, the Power of Attorney and the
Custody Agreement and to sell, assign, transfer and deliver the
Designated Shares to be delivered by such Selling Shareholder at such
Time of Delivery;
(ii) The sale of the Designated Shares to be delivered by the
Selling Shareholder at each Time of Delivery and the compliance by such
Selling Shareholder with all of the provisions of this Agreement, the
Pricing Agreement, the Power of Attorney and the Custody Agreement and
the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any statute,
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which such Selling Shareholder is a party or by which
such Selling Shareholder is bound or to which any of the property or
assets of such Selling Shareholder is
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subject, nor will such action result in any violation of the provisions
of the Certificate of Incorporation or By-laws of such Selling
Shareholder or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over such
Selling Shareholder or the property of such Selling Shareholder;
(iii) The Selling Shareholder has, and immediately prior to
each Time of Delivery (as defined in Section 4 hereof) such Selling
Shareholder will have, good and valid title to the Designated Shares to
be delivered by such Selling Shareholder at such Time of Delivery, free
and clear of all liens, encumbrances, equities or claims; and, upon
delivery of such Designated Shares and payment therefor pursuant
hereto, good and valid title to such Designated Shares, free and clear
of all liens, encumbrances, equities or claims, will pass to the
Underwriters;
(iv) During the period beginning from the date of the Pricing
Agreement for such Designated Shares and continuing to and including 90
days after the date of the Prospectus, not to offer, sell, contract to
sell or otherwise dispose of, except as provided hereunder, any
securities of the Company that are substantially similar to the Shares,
including but not limited to any securities that are convertible into
or exchangeable for, or that represent the right to receive, Shares or
any such substantially similar securities (other than pursuant to
employee stock option plans existing on, or upon the conversion or
exchange of convertible or exchangeable securities outstanding as of,
the date of this Agreement or pursuant to the settlement provisions of
the confirmation dated January 26, 2001 by and between the Company and
the Selling Shareholder as in effect as of the date hereof in
connection with the equity forward transaction, but only if and to the
extent that the Company shall declare an Optional Termination (as
defined in such confirmation) of the equity forward transaction),
without your prior written consent;
(v) The Selling Shareholder has not taken and will not take,
directly or indirectly, any action that is designed to or that has
constituted or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares;
(vi) To the extent that any statements or omissions made in
the Registration Statement, any Preliminary Prospectus, the Prospectus
or any amendment or supplement thereto are made in reliance upon and in
conformity with written information furnished to the Company by the
Selling Shareholder expressly for use therein, such Preliminary
Prospectus and the Registration Statement did, and the Prospectus and
any further amendments or supplements to the Registration Statement and
the Prospectus, when they become effective or are filed with the
Commission, as the case may be, will conform in all material respects
to the requirements of the Act and the rules and regulations of the
Commission thereunder and will not contain any 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 not misleading;
(vii) In order to document the Underwriters' compliance with
the reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, such Selling Shareholder will deliver to you prior to or
at each Time of Delivery (as hereinafter defined) a properly completed
and executed United
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States Treasury Department Form W-9 (or other applicable form or
statement specified by Treasury Department regulations in lieu
thereof);
(viii) Certificates in negotiable form representing all of the
Designated Shares to be sold by the Selling Shareholder at the Time of
Delivery have been placed in custody under a Custody Agreement, in the
form heretofore furnished to you (the "Custody Agreement"), duly
executed and delivered by such Selling Shareholder to Bank of New York,
as custodian (the "Custodian"), and such Selling Shareholder has duly
executed and delivered a Power of Attorney, in the form heretofore
furnished to you (the "Power of Attorney"), appointing the persons
indicated in Annex IV and each of them, as such Selling Shareholder's
attorneys-in-fact (the "Attorneys-in-Fact") with authority to execute
and deliver this Agreement and the pricing agreement on behalf of such
Selling Shareholder, to determine the purchase price to be paid by the
Underwriters to the Selling Shareholder as provided in Schedule I of
the Pricing Agreement, to authorize the delivery of the Designated
Shares to be delivered by such Selling Shareholder at the Time of
Delivery and otherwise to act on behalf of such Selling Shareholder in
connection with the transactions contemplated by this Agreement and the
Custody Agreement; and
(ix) The Designated Shares represented by the certificates
held in custody for the Selling Shareholder under the Custody Agreement
are subject to the interests of the Underwriters under the Pricing
Agreement; the arrangements made by such Selling Shareholder for such
custody, and the appointment by such Selling Shareholder of the
Attorneys-in-Fact by the Power of Attorney, are to that extent
irrevocable; the obligations of the Selling Shareholder hereunder and
under the Pricing Agreement shall not be terminated by operation of
law, whether by the dissolution of the corporation or by the occurrence
of any other event; or if the corporation should be dissolved, or if
any other such event should occur, before the delivery of the
Designated Shares at the Time of Delivery, certificates representing
the Designated Shares shall be delivered by or on behalf of the Selling
Shareholder in accordance with the terms and conditions of this
Agreement, the Pricing Agreement and of the Custody Agreement; and
actions taken by the Attorneys-in-Fact pursuant to the Powers of
Attorney shall be as valid as if such dissolution or other event had
not occurred, regardless of whether or not the Custodian, the
Attorneys-in-Fact, or any of them, shall have received notice of such
dissolution or other event.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Shares and authorization by the Underwriters of the release of the
Designated Shares, the Underwriters propose to offer the Designated Shares for
sale upon the terms and conditions set forth in the Prospectus as amended or
supplemented.
4. Certificates for the Designated Shares to be purchased by the
Underwriters pursuant to the Pricing Agreement relating thereto, in the form
specified in such Pricing Agreement and in such authorized denominations and
registered in such names as the Underwriters may request upon at least
forty-eight hours' prior notice to the Company and the Selling Shareholder,
shall be delivered by or on behalf of the Company and the Selling Shareholder to
the Underwriters, against payment by the Underwriters or on their behalf of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified and the Custodian to the Underwriters at least forty-eight
hours in
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advance as specified in such Pricing Agreement, all in the manner and at the
place and time and date specified in such Pricing Agreement or at such other
place and time and date as the Underwriters, the Company and the Selling
Shareholder may agree upon in writing. Each such time and date for delivery is
herein called a "Time of Delivery".
5. The Company agrees with the Underwriters:
(a) To prepare the Prospectus as amended and supplemented in
relation to the applicable Designated Shares in a form approved by the
Underwriters and to file such Prospectus pursuant to Rule 424(b) under
the Act not later than the Commission's close of business on the second
business day following the execution and delivery of the Pricing
Agreement relating to the applicable Designated Shares or, if
applicable, such earlier time as may be required by Rule 424(b); to
make no further amendment or any supplement to the Registration
Statement or Prospectus as amended or supplemented after the date of
the Pricing Agreement relating to such Shares and prior to any Time of
Delivery for such Shares that shall be disapproved by the Underwriters
promptly after reasonable notice thereof; to advise the Underwriters
promptly of any such amendment or supplement after any Time of Delivery
for such Shares and furnish the Underwriters with copies thereof; to
file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act for
so long as the delivery of a prospectus is required in connection with
the offering or sale of such Shares, and during such same period to
advise the Underwriters, promptly after it receives notice thereof, of
the time when any amendment to the Registration Statement has been
filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed with the Commission, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any prospectus relating to the Shares, of the
suspension of the qualification of such Shares for offering or sale in
any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus
or for additional information; and, in the event of the issuance of any
such stop order or of any such order preventing or suspending the use
of any prospectus relating to the Shares or suspending any such
qualification, promptly to use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as the
Underwriters may reasonably request to qualify such Shares for offering
and sale under the securities laws of such jurisdictions as the
Underwriters may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of such
Shares, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time
to time, to furnish the Underwriters with written and electronic copies
of the Prospectus as amended or supplemented in New York City in such
quantities as the Underwriters may reasonably request, and, if the
delivery of a
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prospectus is required at any time in connection with the offering or
sale of the Shares and if at such time any event shall have occurred as
a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it
shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Act or the
Exchange Act, to notify the Underwriters and upon their request to file
such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many written and
electronic copies as the Underwriters may from time to time reasonably
request of an amended Prospectus or a supplement to the Prospectus that
will correct such statement or omission or effect such compliance; and
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Act), an earnings statement of the Company and
its subsidiaries (which need not be audited) complying with Section
11(a) of the Act and the rules and regulations of the Commission
thereunder (including, at the option of the Company, Rule 158);
6. The Company hereby covenants and agrees with the Underwriters that
(a) the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
this Agreement, any Pricing Agreement, any Blue Sky Memorandum, closing
documents (including compilations thereof) and any other documents in connection
with the offering, purchase, sale and delivery of the Shares; (iii) all expenses
in connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey(s); (iv) any filing
fees incident to, and the fees and disbursements of counsel for the Underwriters
in connection with, any required reviews by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (v) the cost of
preparing certificates for the Shares; (vi) the fees and disbursements of
Xxxxxxxx & Xxxxxxxx, in its capacity as special counsel for the Selling
Shareholder; and (vii) all other costs and expenses incident to the performance
of its obligations hereunder that are not otherwise specifically provided for in
this Section; and (b) such Selling Shareholder will pay or cause to be paid all
costs and expenses incident to the performance of such Selling Shareholder's
obligations hereunder that are not otherwise specifically provided for in this
Section, including all underwriting discounts and commissions and all expenses
and taxes incident to the sale and delivery of the Designated Shares to be
delivered by such Selling Shareholder to the Underwriters at the Time of
Delivery. In connection with the preceding sentence, the Underwriters agree to
pay New York State stock transfer tax, and the Selling Shareholder agrees to
reimburse the Underwriters for associated carrying costs if such tax payment is
not rebated on the day of payment and for any portion of such tax payment not
rebated. It is understood, however, that the Company
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shall bear, and the Selling Shareholder shall not be required to pay or to
reimburse the Company for, the cost of any other matters not directly relating
to the sale and purchase of the Shares pursuant to this Agreement. It is
understood, however, that, except as provided in this Section, and Sections 8
and 10 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of any of the
Shares by them, and any advertising expenses connected with any offers they may
make.
7. The obligations of the Underwriters of any Designated Shares under
the Pricing Agreement relating to such Designated Shares shall be subject, to
the condition that all representations and warranties and other statements of
the Company and of the Selling Shareholder in or incorporated by reference in
the Pricing Agreement relating to such Designated Shares are, at and as of each
Time of Delivery for such Designated Shares, true and correct, the condition
that the Company and the Selling Shareholder shall have performed all of its and
their respective obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to
such Designated Shares shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall
have been issued and no proceeding for that purpose shall have been
initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the Underwriters' reasonable satisfaction;
(b) Messrs. Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters,
shall have furnished to the Underwriters such written opinion or
opinions, dated each Time of Delivery for such Designated Shares, with
respect to the validity of the Designated Shares and the matters
covered in paragraphs (i), (iv), (viii), and (xi) of subsection (c)
below as well as such other related matters as the Representatives may
reasonably request, and such counsel shall have received such papers
and information as they may reasonably request to enable them to pass
upon such matters;
(c) Xxxxxxxx X. Xxxxx, Esq., General Counsel for the Company,
shall have furnished to the Underwriters their written, dated each Time
of Delivery for such Designated Shares, respectively, in form and
substance reasonably satisfactory to the Underwriters, to the effect
that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus as amended or supplemented;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus as amended or supplemented, and all of the issued
shares of capital stock of the Company (including, the Designated
Shares being delivered at such Time of Delivery) have been duly
-10-
and validly authorized and issued and are fully paid and
non-assessable; and such Designated Shares conform to the description
thereof in the Prospectus as amended or supplemented;
(iii) To the best of such counsel's knowledge and other than
as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the Company or any of its
subsidiaries is the subject which, if determined adversely to the
Company or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of
operations of the Company and its subsidiaries; and to the best of such
counsel's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others;
(iv) This Agreement and the Pricing Agreement with respect to
the Designated Shares have been duly authorized, executed and delivered
by the Company;
(v) The compliance by the Company with all of the provisions
of this Agreement and the Pricing Agreement with respect to the
Designated Shares and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the Company is a
party or by which the Company is bound or to which any of the property
or assets of the Company is subject, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or
By-laws of the Company or any statute or any order, rule or regulation
known to such counsel of any court or governmental agency or body
having jurisdiction over the Company or any of its properties;
(vi) No consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or
body is required for the issue and sale of the Designated Shares being
delivered at such Time of Delivery or the consummation by the Company
of the transactions contemplated by this Agreement or such Pricing
Agreement, except such as have been obtained under the Act and such
consents, approvals, authorizations, registrations or qualifications as
may be required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Designated Shares by the
Underwriters;
(vii) Neither the Company nor any of its material subsidiaries
is in violation of its Certificate of Incorporation or By-laws or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties may be
bound;
(viii) The statements set forth or incorporated by reference
in the Prospectus with respect to the description of the Common Stock
of the Company, insofar as they purport to constitute a summary of the
terms of the Shares, and under the captions "Plan of Distribution"
-11-
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate, complete and fair;
(ix) The Company is not an "Investment Company", as such term
is defined in the Investment Company Act;
(x) The documents incorporated by reference in the Prospectus
as amended or supplemented (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion), when they became effective or were filed with the Commission,
as the case may be, complied as to form in all material respects with
the requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder; and they have no
reason to believe that any of such documents, when they became
effective or were so filed, as the case may be, contained, in the case
of a registration statement which became effective under the Act, 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, in the case of other documents that were
filed under the Act or the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so
filed, not misleading; and
(xi) The Registration Statement and the Prospectus as amended
or supplemented, and any further amendments and supplements thereto
made by the Company prior to such Time of Delivery (other than the
financial statements and related schedules therein, as to which such
counsel need express no opinion), comply as to form in all material
respects with the requirements of the Act and the rules and regulations
thereunder; although they do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those referred to
in the opinion in subsection (viii) of this Section 7(c), they have no
reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior to
such Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion)
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, as of its date, the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Company prior to such Time of Delivery
(other than the financial statements and related schedules therein, as
to which such counsel need express no opinion) contained an untrue
statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading or that, as of
such Time of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Company prior to such Time of Delivery
(other than the financial statements and related schedules therein, as
to which such counsel need express no opinion) contains an untrue
statement of a material fact 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; and they do
not know of any amendment to the Registration Statement required to
-12-
be filed or any contracts or other documents of a character required to
be filed as an exhibit to the Registration Statement or required to be
incorporated by reference into the Prospectus as amended or
supplemented or required to be described in the Registration Statement
or the Prospectus as amended or supplemented which are not filed or
incorporated by reference or described as required.
Such counsel may rely on the opinion of Xxxxxxxx & Xxxxxxxx as to
matters of New York law.
(d) Ice Xxxxxx, counsel for the Selling Shareholder, shall
have furnished to you their written opinion with respect to the Selling
Shareholder, dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) A Power-of-Attorney and a Custody Agreement have been duly
executed and delivered by such Selling Shareholder and constitute valid
and binding agreements of such Selling Shareholder enforceable in
accordance with their terms;
(ii) Each of this Agreement and the Pricing Agreement has been
duly executed and delivered by or on behalf of such Selling
Shareholder; and the sale of the Designated Shares being delivered by
such Selling Shareholder at such Time of Delivery and the compliance by
such Selling Shareholder with all of the provisions of this Agreement,
the Pricing Agreement, the Power-of-Attorney and the Custody Agreement
with respect to such Designated Shares and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any terms or provisions of, or
constitute a default under, any statute, indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which such Selling Shareholder is a party or by which such
Selling Shareholder is bound or to which any of the property or assets
of such Selling Shareholder is subject, nor will such action result in
any violation of the provisions of the Certificate of Incorporation or
By-laws of such Selling Shareholder or any order, rule or regulation
known to such counsel of any court or governmental agency or body
having jurisdiction over such Selling Shareholder or the property of
such Selling Shareholder;
(iii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the sale of such
Designated Shares being delivered by such Selling Shareholder at such
Time of Delivery or the consummation of the transactions contemplated
by this Agreement and the Pricing Agreement to be sold by such Selling
Shareholder hereunder, except such as have been obtained under the Act
and such as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of such Designated Shares
by the Underwriters;
(iv) Immediately prior to such Time of Delivery, such Selling
Shareholder had good and valid title to the Designated Shares to be
delivered at such Time of Delivery by such Selling Shareholder under
this Agreement and the Pricing Agreement, free and clear of all liens,
encumbrances, equities or claims, and full right, power and authority
to sell, assign, transfer and deliver the Shares to be sold by such
Selling Shareholder hereunder; and
(v) Good and valid title to such Designated Shares, free and
clear of all liens, encumbrances, equities or claims, has been
transferred to the Underwriters who have
-13-
purchased such Shares in good faith and without notice of any such
lien, encumbrance, equity or claim or any other adverse claim within
the meaning of the Uniform Commercial Code.
In rendering the opinion in paragraph (iv), such counsel may rely upon
a certificate of such Selling Shareholder in respect of matters of fact as to
ownership of, and liens, encumbrances, equities or claims on, the Shares sold by
such Selling Shareholder, provided that such counsel shall state that they
believe that both you and they are justified in relying upon such certificate.
In addition, such counsel may rely on the opinion of Xxxxxxxx &
Xxxxxxxx as to matters of New York law.
(e) On the date of the Pricing Agreement for such Designated
Shares and at each Time of Delivery for such Designated Shares, the
independent accountants of the Company who have certified the financial
statements of the Company and its subsidiaries included or incorporated
by reference in the Registration Statement shall have furnished to the
Underwriters a letter, dated the date of the Pricing Agreement, and a
letter dated such Time of Delivery, respectively, to the effect set
forth in Annex II hereto (a draft of the form of letter to be delivered
on the date of the Pricing Agreement for such Designated Shares is
attached as Annex II(a) hereto and a draft of the form of letter to be
delivered at the Time of Delivery for such Designated Shares is
attached as Annex II(b) hereto), and with respect to such letter dated
such Time of Delivery, as to such other matters as the Underwriters may
reasonably request and in form and substance satisfactory to the
Underwriters;
(f) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus as
amended prior to the date of the Pricing Agreement relating to the
Designated Shares any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus as amended prior to the date of the Pricing Agreement
relating to the Designated Shares, and (ii) since the respective dates
as of which information is given in the Prospectus as amended prior to
the date of the Pricing Agreement relating to the Designated Shares
there shall not have been any change in the capital stock, or long-term
debt of the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus as amended prior to
the date of the Pricing Agreement relating to the Designated Shares,
the effect of which, in any such case described in clause (i) or (ii),
is in the judgment of the Underwriters so material and adverse as to
make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Designated Shares on the terms and in
the manner contemplated in the Prospectus as amended relating to the
Designated Shares;
(g) On or after the date of the Pricing Agreement relating to
the Designated Shares (i) no downgrading shall have occurred in the
rating accorded the Company's debt securities or preferred stock by any
"nationally recognized statistical rating organization", as that term
is
-14-
defined by the Commission for purposes of Rule 436(g)(2) under the Act,
and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities or preferred stock;
(h) On or after the date of the Pricing Agreement relating to
the Designated Shares there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (ii) a suspension
or material limitation in trading in the Company's securities on the
New York Stock Exchange; (iii) a general moratorium on commercial
banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war, if the effect of any such event specified
in this clause (iv) in the judgment of the Underwriters makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Designated Shares on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented
relating to the Designated Shares;
(i) The Shares at each Time of Delivery shall have been duly
listed on the New York Stock Exchange;
(j) The Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses on
the New York Business Day next succeeding the date of the Pricing
Agreement relating to such Designated Shares; and
(k) The Company shall have furnished or caused to be furnished
to the Underwriters at each Time of Delivery for the Designated Shares
certificates of officers of the Company satisfactory to the
Underwriters as to the accuracy of the representations and warranties
of the Company herein at and as of such Time of Delivery, as to the
performance by the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set
forth in subsections (a) and (f) of this Section and as to such other
matters as the Underwriters may reasonably request.
8. (a) The Company and the Selling Shareholder, jointly and
severally, will indemnify and hold harmless the Underwriters against
any losses, claims, damages or liabilities, joint or several, to which
the Underwriters may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus as amended or supplemented and
any other prospectus relating to the Shares, or any amendment 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
will reimburse the Underwriters for any legal or other expenses
reasonably incurred by the Underwriters in connection with
investigating or defending any such action or claim as such expenses
are incurred; PROVIDED, HOWEVER, that the Company and the Selling
Shareholder shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is
-15-
based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the
Shares, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by the
Underwriters expressly for use in the Prospectus as amended or
supplemented relating to such Shares.
(b) The Underwriters will indemnify and hold harmless the
Company and the Selling Shareholder against any losses, claims, damages
or liabilities to which the Company or the Selling Shareholder may
become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating
to the Shares, or any amendment 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, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating
to the Shares, or any such amendment or supplement in reliance upon and
in conformity with written information furnished to the Company by the
Underwriters expressly for use therein; and will reimburse the Company
and the Selling Shareholder for any legal or other expenses reasonably
incurred by the Company or such Selling Shareholder in connection with
investigating or defending any such action or claim as such expenses
are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify
the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party shall not relieve it from
any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel 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 shall not be liable to such indemnified
party under such subsection for any legal expenses of other counsel or
any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without
the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to,
any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified party is an actual or potential party to such action or
claim) unless such settlement, compromise or
-16-
judgment (i) includes an unconditional release of the indemnified party
from all liability arising out of such action or claim and (ii) does
not include any 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 8 is
unavailable to or insufficient to hold harmless an indemnified party
under subsection (a) or (b) above in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received
by the Company and the Selling Shareholder on the one hand and the
Underwriters of the Designated Shares on the other from the offering of
the Designated Shares to which such loss, claim, damage or liability
(or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice
required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company and the Selling
Shareholder on the one hand and the Underwriters of the Designated
Shares on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Selling Shareholder on the one hand and such Underwriters on the other
shall be deemed to be in the same proportion as the total net proceeds
from such offering (before deducting expenses) received by the Selling
Shareholder bears to the total underwriting discounts and commissions
received by such Underwriters. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company
and the Selling Shareholder on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Company, the Selling Shareholder and the Underwriters
agree that it would not be just and equitable if contributions pursuant
to this subsection (d) were determined by PRO RATA allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred
to above in 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 such action or claim.
Notwithstanding the provisions of this subsection (d), the Underwriters
shall not be required to contribute any amount in excess of the amount
by which the total price at which the applicable Designated Shares
underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which the Underwriters 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 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
-17-
(e) The obligations of the Company and the Selling Shareholder
under this Section 8 shall be in addition to any liability which the
Company and the Selling Shareholder may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls the Underwriters within the meaning of the Act; and the
obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the Underwriters may otherwise have and
shall extend, upon the same terms and conditions, to each officer and
director of the Company or the Selling Shareholder and to each person,
if any, who controls the Company or the Selling Shareholder within the
meaning of the Act.
9. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Shareholder and the
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of the Underwriters or any controlling person of the
Underwriters, or the Company, or the Selling Shareholder, or any officer or
director or controlling person of the Company, or any officer or director or
controlling person of the Selling Shareholder and shall survive delivery of and
payment for the Shares.
10. If for any reason, Designated Shares are not delivered by or on
behalf of the Selling Shareholder as provided herein, the Selling Shareholder
will reimburse the Underwriters for all out-of-pocket expenses, including fees
and disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of such Designated Shares, but
the Company and the Selling Shareholder shall then be under no further liability
to the Underwriters with respect to such Designated Shares except as provided in
Sections 6 and 8 hereof.
11. In all dealings with Selling Shareholder hereunder, the
Underwriters and the Company shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of the Selling Shareholder
made or given by any or all of the Attorneys-in-Fact for such Selling
Shareholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to Xxxxxxx, Xxxxx & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, XX
00000, facsimile: (000) 000-0000; if to the Selling Shareholder shall be
delivered or sent by mail, telex, or facsimile transmission to the attention of
Xxxxxx X. Xxxxxx, President and Executive Officer, Lumina Foundation for
Education, Inc. , 00 X. Xxxxxxxx Xx., Xxxxxxxxxxxx, XX 00000, facsimile :
000-000-0000, with a copy to counsel for such Selling Shareholder, Ice Xxxxxx,
Xxx Xxxxxxxx Xxxxxx, Xxx 00000, Xxxxxxxxxxxx, XX 00000-0000, facsimile: (317)
236-2219; and if to the Company shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Senior Vice-President and General Counsel.
Any such statements, requests, notices or agreements shall take effect upon
receipt thereof.
12. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and the
Selling Shareholder and, to the extent provided in Sections 8 and 9 hereof, the
officers and directors of the Company and the Selling Shareholder and each
person who controls the Company, the Selling Shareholder or the Underwriters,
and their respective successors and assigns, and no other person shall acquire
or have any right under or by
-18-
virtue of this Agreement or any such Pricing Agreement. No purchaser of any of
the Shares from the Underwriters shall be deemed a successor or assign by reason
merely of such purchase.
13. Time shall be of the essence of each Pricing Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
14. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
15. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us eight counterparts hereof.
Very truly yours,
USA EDUCATION, INC.
By: /s/ Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
Title: Executive Vice President &
Chief Financial Officer
LUMINA FOUNDATION FOR EDUCATION, INC.
By:./s/ J. David Mass
Name: J. Xxxxx Xxxx
Title: Senior Vice President & Chief
Financial Officer
Accepted as of the date hereof:
/s/ Xxxxxxx, Xxxxx & Co.
(Xxxxxxx, Sachs & Co.)
-19-
ANNEX I
PRICING AGREEMENT
Xxxxxxx, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
......................, 2001
Ladies and Gentlemen:
Lumina Foundation for Education, Inc., as a selling shareholder (the
"Selling Shareholder") of shares of Common Stock of USA Education, Inc. (the
"Company"), proposes, subject to the terms and conditions stated herein and in
the above-mentioned Underwriting Agreement between the Company and Selling
Shareholder on the one hand and Xxxxxxx, Sachs & Co. (the "Underwriters") to
sell to the Underwriters the Shares specified in Schedule I hereto (the
"Designated Shares"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Shares which are the
subject of this Pricing Agreement. Unless otherwise defined herein, terms
defined in the Underwriting Agreement are used herein as therein defined.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Shares, in the form
heretofore delivered to you is now proposed to be filed with the Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Selling Shareholder
agrees to sell to the Underwriters, and the Underwriters agree to purchase from
the Selling Shareholder, at the time and place and at the purchase price to the
Underwriters set forth in Schedule I hereto, the number of Designated Shares set
forth in Schedule I hereto.
F-1
If the foregoing is in accordance with your understanding, please sign
and return to us two counterparts hereof, and upon acceptance hereof by you,
this letter and such acceptance hereof, including the provisions of the
Underwriting Agreement incorporated herein by reference, shall constitute a
binding agreement between you, the Company and the Selling Shareholder.
Very truly yours,
USA EDUCATION, INC.
By:
--------------------------------------
Name:
Title:
LUMINA FOUNDATION FOR EDUCATION, INC.
By:
--------------------------------------
Name:
Title:
Accepted as of the date hereof:
------------------------------------------
(Xxxxxxx, Xxxxx & Co.)
F-2
SCHEDULE I - DESIGNATED SHARES
TITLE OF DESIGNATED SHARES: COMMON STOCK, $___ PAR VALUE, OF USA EDUCATION, INC.
NUMBER OF DESIGNATED SHARES:
PURCHASE PRICE BY UNDERWRITERS:
[$........ per Share] [Formula]
[COMMISSION PAYABLE TO UNDERWRITERS:
$........ per Share in
FORM OF DESIGNATED SHARES:
Definitive form, to be made available for checking [and packaging] at least
twenty-four hours prior to the Time of Delivery at the office of [The Depository
Trust Company or its designated custodian] [the Underwriters]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Federal (same-day) funds
[DESCRIBE ANY BLACKOUT PROVISIONS WITH RESPECT TO THE DESIGNATED SHARES]
TIME OF DELIVERY:
......... a.m. (New York City time), .................., 2001
CLOSING LOCATION:
NAMES AND ADDRESS OF UNDERWRITERS:
[OTHER TERMS] :
[Please see attached sheets.]
F-3
ANNEX II
DRAFT FORMS TO BE ATTACHED
F-4