EXHIBIT 1.1
Underwriting Agreement dated December 4, 2000
$130,200,000
Education Loans Incorporated
----------------------------
STUDENT LOAN ASSET-BACKED NOTES, SERIES 2000-1
consisting of
$54,100,000 Student Loan Asset-Backed Notes, Senior Series 2000-1A
$54,100,000 Student Loan Asset-Backed Notes, Senior Series 2000-1B
$22,000,000 Student Loan Asset-Backed Notes, Subordinate Series 2000-1C
Underwriting Agreement
----------------------
December 4, 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sirs:
Education Loans Incorporated, a Delaware corporation ("EdLinc") and
wholly-owned subsidiary of Student Loan Finance Corporation, a South Dakota
corporation ("SLFC"), proposes to sell $130,200,000 aggregate principal amount
of its Student Loan Asset-Backed Notes, Series 2000-1 (the "Notes") to ▇▇▇▇▇▇▇
▇▇▇▇▇ Barney Inc. (the "Underwriter") pursuant to the terms of this Underwriting
Agreement (this "Agreement"),. The Notes are to be issued in three series
designated as Student Loan Asset-Backed Notes, Senior Series 2000-1A (the
"Series 2000-1A Notes"), Student Loan Asset-Backed Notes, Senior Series 2000-1B
(the "Series 2000-1B Notes", and together with the Series 2000-1A Notes, the
"Series 2000-1 Senior Notes") and Student Loan Asset-Backed Notes, Subordinate
Series 2000-1C (the "Series 2000-1 Subordinate Notes"). The initial aggregate
principal amounts of each series of Notes shall be as listed in Appendix A
hereto.
The Notes shall be as described in, shall be subject to redemption and
auction, shall have such other provisions and details and shall be issued
pursuant to the Second Supplemental Indenture, dated as of December 1, 2000 (the
"Supplemental Indenture"), supplemental to an Indenture of Trust, dated as of
December 1, 1999 (as supplemented and amended, the "Indenture"), between EdLinc
and U.S. Bank National Association, as trustee (the "Trustee"). Upon issuance,
the Trustee shall use proceeds of the Notes to acquire Student Loans as
described in the Prospectus from Goal Funding, Inc., a Delaware corporation (the
"Transferor") and wholly-owned subsidiary of SLFC, and the Notes will be secured
by, among other things, Financed Student Loans pledged to the Trustee and
described in the Prospectus (as hereinafter defined).
Underwriting Agreement dated December 4, 2000
Capitalized terms used but not defined herein have the respective
meanings ascribed thereto in Appendix B hereto.
1. Agreement to Sell, Purchase and Resell
--------------------------------------
(a) EdLinc hereby agrees, subject to all of the terms and conditions
set forth herein, to sell to the Underwriter and, upon the basis of the
representations, warranties and agreements of EdLinc, the Transferor and SLFC
herein contained and subject to all of the terms and conditions set forth
herein, the Underwriter agrees to purchase from EdLinc, all (but not less than
all) of the Notes at the aggregate purchase price of $129,630,030, and EdLinc
hereby agrees to pay on behalf of the Underwriter, the fees and expenses of
counsel to the Underwriter in the aggregate amount of $100,000. The maturity
dates, purchase prices and underwriting discounts for each series of the Notes
shall be as listed in Appendix A hereto.
(b) The Series 2000-1 Senior Notes and the Series 2000-1 Subordinate
Notes shall bear interest for the period commencing on the date of issuance of
the Notes through the end of the respective Initial Interest Periods at the
respective per annum rates specified in Appendix A hereto. Thereafter, such
rates per annum shall be determined in accordance with the Supplemental
Indenture.
(c) It is understood that the Underwriter proposes to offer the Notes
for sale to the public (which may include selected dealers) as set forth in the
Prospectus. The Notes may be offered and sold to certain dealers (including the
Underwriter and other dealers depositing such Notes into investment trusts or
mutual funds) at prices lower than such public offering prices.
(d) The Underwriter is duly authorized to execute this Agreement and
to act hereunder.
(e) The Underwriter represents and agrees that (i) it has not offered
or sold, and will not offer or sell, any Notes to persons in the United Kingdom
except to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the purpose of
their businesses or otherwise in circumstances which have not resulted, and will
not result in, an offer to the public in the United Kingdom within the meaning
of the Public Offers of Securities Regulations 1995; (ii) it has complied and
will comply with all applicable provisions of the Financial Services Act of 1986
with respect to anything done by it in relation to the Notes in, from or
otherwise involving the United Kingdom; and (iii) it has only issued or passed
on, and will only issue and pass on, in the United Kingdom any document received
by it in connection with the issue of the Notes to a person who is of a kind
described in Article 11(3) of the Financial Services ▇▇▇ ▇▇▇▇ (Investment
Advertisements) (Exemptions) Order 1996 or to a person to whom such document may
otherwise lawfully be issued, distributed or passed on.
2. Delivery of the Notes and Payment Therefor
------------------------------------------
At 9:00 A.M., New York City time, on December 5, 2000, or at such
other time or on such earlier or later business day as shall have been mutually
agreed upon by EdLinc, SLFC, the Transferor and the Underwriter (the "Closing
Date"), EdLinc will deliver to DTC, for the account of the Underwriter, the
Notes in definitive form bearing CUSIP numbers, duly executed
-2-
Underwriting Agreement dated December 4, 2000
and authenticated, together with the other documents hereinafter mentioned; and
the Underwriter will accept such delivery and pay the purchase price of the
Notes as set forth in Section 1 hereof in immediately available funds to the
account of EdLinc and EdLinc shall pay to Underwriter's counsel, on behalf of
the Underwriter, the fees and expenses of Underwriter's counsel as set forth in
Section 1 hereof in immediately available funds to the account of ▇▇▇▇▇ &
▇▇▇▇▇▇▇. Delivery of the Notes and payment as aforesaid shall be made at such
location in New York, New York as shall be requested by the Underwriter.
Delivery of the other documents shall be at the offices ▇▇▇▇▇▇ & Whitney LLP,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇. This payment and delivery is herein
called the "Closing". The Notes delivered at the Closing shall be made available
to the Trustee for the benefit of the Underwriter, to facilitate a "Fast'
closing through DTC, at least one business day prior to the date of the Closing
for purposes of inspection. The Notes shall be prepared and delivered as fully
registered notes in authorized denominations and registered in such manner as
the Underwriter shall have requested.
3. Representations and Warranties of EdLinc, SLFC and the
------------------------------------------------------
Transferor.
-----------
EdLinc, SLFC and the Transferor represent and warrant to, and agree
with, the Underwriter that:
(a) A registration statement on Form S-3 (File No. 333-85963),
including a prospectus and such amendments thereto as may have been required to
the date hereof, relating to the Notes and the offering thereof from time to
time in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "Securities Act") has been filed with the Securities and Exchange
Commission (the "Commission") and such registration statement, as amended, has
become effective under the Securities Act; such registration statement, as
amended, including all information (if any) deemed to be a part of such
registration statement as of the Effective Time (as defined below), and
including the exhibits thereto and any material incorporated by reference
therein, and the prospectus and the prospectus supplement relating to the sale
of the Notes offered thereby constituting a part thereof, as amended or
supplemented including any prospectus filed under Rule 424(b) under the
Securities Act, are respectively referred to herein as the "Registration
Statement" and the "Prospectus"; and the conditions to the use of a registration
statement on Form S-3 under the Securities Act, as set forth in the General
Instructions to Form S-3, and the conditions of Rule 415 under the Securities
Act have been satisfied with respect to the Registration Statement. For purposes
of this Agreement, "Effective Time" means (x) if EdLinc has advised the
Underwriter that it does not propose to amend the Registration Statement, the
date and time as of which the Registration Statement, or the most recent
amendment thereto (if any) filed prior to the execution and delivery of this
Agreement, was declared effective by the Commission, or (y) if EdLinc has
advised the Underwriter that it proposes to file an amendment or post effective
amendment to the Registration Statement, the date and time as of which the
Registration Statement, as amended by such amendment or post effective
amendment, as the case may be, is declared effective by the Commission.
"Effective Date" means the date of the Effective Time. Copies of the
Registration Statement, the Prospectus and all other documents which were filed
by EdLinc with the Commission on or prior to the date hereof have been delivered
to you. For purposes of this Agreement, all references to the Registration
Statement and the Prospectus or any amendment or supplement thereto shall be
-3-
Underwriting Agreement dated December 4, 2000
deemed to include the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval System ("▇▇▇▇▇").
(b) On the Effective Date, on the date of this Agreement and on the
Closing Date, the Registration Statement and the Prospectus conformed, conform
and will conform in all material respects to the requirements of the Securities
Act, the rules and regulations of the Commission (the "Rules and Regulations")
and the Trust Indenture Act of 1939, as amended, and the rules and regulations
thereunder (the "Trust Indenture Act"), and in the case of the Registration
Statement, did not, does not and will not include any 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 and in the case of the
Prospectus, did not, does not and will not include any 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 light of the circumstances
under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to any statements made in reliance
upon and in conformity with information furnished in writing to EdLinc by the
Underwriter expressly for use therein. There are no contracts or other documents
required by the Securities Act or by the Rules and Regulations to be described
in the Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement which have not been described or filed as required.
The Prospectus delivered to the Underwriter for use in connection with the
offering of the Notes was identical to the electronically transmitted copies
thereof filed with the Commission.
(c) The Commission has not issued and, to the best knowledge of
EdLinc and SLFC, is not threatening to issue any order preventing or suspending
the use of the Registration Statement. No order preventing or suspending the use
of any prospectus has been issued by the Commission or any state regulatory
authority or other jurisdictional regulatory agency ("Blue Sky Authorities").
(d) As of the Closing Date, each consent, approval, authorization or
order of, or filing with, any court or governmental agency or body which is
required to be obtained or made by the EdLinc, SLFC, the Transferor or any of
their affiliates for the consummation of the transactions contemplated by this
Agreement shall have been obtained, except as otherwise provided in the Basic
Documents.
(e) EdLinc has the requisite power and authority to execute, deliver
and perform its obligations under the Indenture, the Supplemental Indenture, the
Letter of Representations and the Auction Agent Agreement. The Indenture, the
Supplemental Indenture, the Letter of Representations and the Auction Agent
Agreement have been duly and validly authorized by EdLinc and, upon their
execution and delivery by EdLinc, assuming due authorization, execution and
delivery by the other parties thereto, will be duly executed and delivered by
EdLinc and will constitute valid and legally binding agreements of EdLinc,
enforceable in accordance with their terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws of general applicability affecting creditors' rights or general equitable
principles. The Indenture, the Supplemental Indenture, the Letter of
Representations and the Auction Agent Agreement conform in all material respects
to the descriptions thereof in the Prospectus.
-4-
Underwriting Agreement dated December 4, 2000
(f) EdLinc has the requisite power and authority to issue the Notes.
The Notes have been duly authorized by EdLinc and, when executed by EdLinc,
authenticated by the Trustee in accordance with the Indenture and delivered to
the Underwriter against payment therefor in accordance with the terms hereof,
will have been validly issued and delivered, and will constitute valid and
legally binding obligations of EdLinc entitled to the benefits of the Indenture
and enforceable in accordance with their terms, except as enforcement thereof
may be limited by bankruptcy, insolvency, moratorium, or other similar laws of
general applicability relating to or affecting creditors' rights or general
equitable principles. The Notes conform in all material respects to the
description thereof in the Prospectus.
(g) EdLinc and the Transferor each has the requisite power and
authority to execute, deliver and perform its obligations under the Transfer
Agreement. The Transfer Agreement has been duly and validly authorized, executed
and delivered by EdLinc and the Transferor and, upon their execution and
delivery (assuming due authorization, execution and delivery by the other
parties thereto) will be duly executed and delivered by each of EdLinc and the
Transferor and will constitute a valid and legally binding agreement of each of
EdLinc and the Transferor, enforceable in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws of general applicability relating to or
affecting creditors' rights or general equitable principles. The Transfer
Agreement conforms in all material respects to the descriptions thereof in the
Prospectus.
(h) [Reserved]
(i) EdLinc, SLFC and the Transferor each have all requisite power and
authority to execute, deliver and perform its respective obligations under this
Agreement; the execution and delivery of, and the performance by each of EdLinc,
SLFC and the Transferor of its respective obligations under this Agreement have
been duly and validly authorized by EdLinc, SLFC and the Transferor,
respectively, and this Agreement has been duly executed and delivered by each of
them and constitutes the valid and legally binding agreement of each of them,
enforceable against each of them in accordance with its terms, except as the
enforcement may be limited by bankruptcy, insolvency, moratorium, or other
similar laws relating to or affecting creditors' rights generally or general
equitable principles, and except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws or principles of
public policy.
(j) EdLinc has duly adopted EdLinc's Authorizing Resolutions and has
duly approved the execution, delivery and performance of the Basic Documents,
this Agreement, EdLinc's Program Agreements, the furnishing and use of the
information contained in the Prospectus, and the taking of any and all such
actions as may be required on the part of EdLinc to carry out, give effect to
and consummate the transactions contemplated by this Agreement, the Prospectus,
the Basic Documents, and EdLinc's Program Agreements, and all approvals
necessary in connection with the foregoing have been obtained.
(k) SLFC and the Transferor have duly adopted SLFC's Authorizing
Resolutions and the Transferor's Authorizing Resolutions, respectively, and have
duly approved the execution, delivery and performance of the Basic Documents to
which such entity is a party, SLFC's Program Agreements and the Transferor's
Program Agreements, as applicable, the
-5-
Underwriting Agreement dated December 4, 2000
furnishing and use of the information contained in the Prospectus, and the
taking of any and all such actions as may be required on the part of SLFC and
the Transferor to carry out, give effect to and consummate the transactions
contemplated by this Agreement, the Prospectus, EdLinc's Program Agreements, the
Transferor's Program Agreements, SLFC's Program Agreements and the Basic
Documents, and all approvals necessary in connection with the foregoing have
been obtained.
(l) EdLinc, the Transferor and SLFC each has the requisite power and
authority to execute, deliver and perform its respective obligations under
EdLinc's Program Agreements, the Transferor's Program Agreements and SLFC's
Program Agreements to which it is a party. EdLinc's Program Agreements, the
Transferor's Program Agreements and SLFC's Program Agreements have been duly and
validly authorized by EdLinc, the Transferor and SLFC to the extent each is a
party thereto and, assuming due authorization, execution and delivery by the
other parties thereto, duly executed and delivered by EdLinc, the Transferor and
SLFC, respectively, and constitute valid and legally binding agreements of
EdLinc, the Transferor and SLFC, respectively, enforceable in accordance with
their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws of general
applicability affecting creditors' rights or general equitable principles.
EdLinc's Program Agreements, the Transferor's Program Agreements and SLFC's
Program Agreements conform in all material respects to the descriptions thereof
in the Prospectus.
(m) EdLinc is a Delaware corporation and wholly owned subsidiary of
SLFC, is duly organized, validly existing and in good standing under the laws of
the State of Delaware, with the requisite power and authority to own, lease and
operate its properties and to conduct its business as conducted on the date
hereof and as contemplated in the Prospectus and with full power and authority
to own and pledge its assets and to issue the Notes as described in the
Prospectus. EdLinc is duly qualified to conduct its business and is in good
standing in each jurisdiction where the nature of its properties or the conduct
of its business requires such qualification, except where the failure so to
qualify could not have a material adverse effect on its condition (financial or
other), business, prospects, properties, net worth or results of operations.
(n) SLFC is a corporation duly organized, validly existing and in
good standing under the laws of the State of South Dakota, with the requisite
power and authority to own, lease and operate its properties and to conduct its
business as conducted on the date hereof and as contemplated in the Prospectus,
and is duly qualified to conduct its business and is in good standing in each
jurisdiction where the nature of its properties or the conduct of its business
requires such qualification, except where the failure so to qualify could not
have a material adverse effect on its condition (financial or other), business,
prospects, properties, net worth or results of operations.
(o) The Transferor is a Delaware corporation and wholly owned
subsidiary of SLFC, is duly organized, validly existing and in good standing
under the laws of the State of Delaware, with the requisite power and authority
to own, lease and operate its properties and to conduct its business as
conducted on the date hereof and as contemplated in the Prospectus. The
Transferor is duly qualified to conduct its business and is in good standing in
each jurisdiction where the nature of its properties or the conduct of its
business requires such qualification,
-6-
Underwriting Agreement dated December 4, 2000
except where the failure so to qualify could not have a material adverse effect
on its condition (financial or other), business, prospects, properties, net
worth or results of operations.
(p) There is no action, suit, proceeding, inquiry or investigation,
at law or in equity, or before or by any court, governmental or public board or
body, pending or known to be threatened against or affecting EdLinc, SLFC or the
Transferor or to which EdLinc, SLFC, the Transferor or any of their respective
properties is subject, nor to the best of the knowledge of EdLinc, SLFC and the
Transferor is there any basis therefor, that are not disclosed in the Prospectus
and wherein an unfavorable decision, ruling or finding would materially
adversely affect the validity or enforceability of the Notes, EdLinc's
Authorizing Resolutions, SLFC's Authorizing Resolution, the Transferor's
Authorizing Resolution, the Basic Documents, EdLinc's Program Agreements, the
Transferor's Program Agreements, SLFC's Program Agreements, the Investment
Agreement, this Agreement or any other agreement or instrument to which EdLinc,
SLFC or the Transferor is a party, used or contemplated for use in the
consummation of transactions contemplated by this Agreement, the Basic
Documents, EdLinc's Program Agreements, the Transferor's Program Agreements,
SLFC's Program Agreements, the Investment Agreement or by the Prospectus.
(q) Neither the offer, sale or delivery of the Notes by EdLinc, nor
the execution, delivery or performance of this Agreement, any of the Basic
Documents or any of EdLinc's Program Agreements, the Transferor's Program
Agreements or SLFC's Program Agreements by EdLinc, SLFC or the Transferor, nor
the adoption of the EdLinc's Authorizing Resolutions, SLFC's Authorizing
Resolution or the Transferor's Authorizing Resolution, nor the consummation by
EdLinc, SLFC or the Transferor of the transactions contemplated hereby or
thereby (i) requires or will require any consent, approval, authorization or
other order of, or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official (except for
compliance with the federal securities laws or Blue Sky laws of various
jurisdictions, the qualification of the Indenture under the Trust Indenture Act
and such other consents, approvals or authorizations as shall have been obtained
prior to the Closing Date), or (ii) conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the
organizational documents of EdLinc, SLFC or the Transferor or (iii) conflicts or
will conflict with or constitutes or will constitute a breach of, or a default
under, in any material respect, any material agreement, indenture, lease or
other instrument to which EdLinc, SLFC or the Transferor is a party or by which
EdLinc, SLFC or the Transferor or any of their respective properties may be
bound, or (iv) violates or will violate in any material respect any statute,
law, regulation or filing or judgment, injunction, order or decree applicable to
EdLinc, SLFC or the Transferor or any of their respective properties, or (v)
results or will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of EdLinc, SLFC or the Transferor
pursuant to the terms of any agreement or instrument to which any is a party or
by which any may be bound or to which any of their respective properties is
subject other than as contemplated by the Basic Documents.
(r) Neither EdLinc, SLFC nor the Transferor is, and following the
consummation of the transactions contemplated hereby and the use of proceeds
from the Notes as described in the Prospectus will be, an "investment company"
under the Investment Company Act of 1940, as amended (the "1940 Act').
-7-
Underwriting Agreement dated December 4, 2000
(s) Neither EdLinc, SLFC, the Transferor nor any of their 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 Statute and
EdLinc, SLFC and the Transferor agrees to comply with such Section if prior to
the completion of the distribution of the Notes it commences doing such
business. EdLinc, SLFC and the Transferor are not, and have not at any time
been, in default in the payment of principal of or interest on any obligations
of EdLinc, SLFC, or the Transferor, respectively.
(t) The representations and warranties made by (i) EdLinc herein, in
the Basic Documents, in EdLinc's Program Agreements and in any officer's
certificate delivered pursuant hereto or thereto and (ii) the Transferor and
SLFC herein, in EdLinc's Program Agreements, in the Transferor's Program
Agreements, in SLFC's Program Agreements, and in any officer's certificate of
the Transferor or SLFC delivered pursuant hereto or thereto, will be true and
correct at the time made and on and as of the Closing Date.
(u) The Indenture will create a first lien upon the Financed Student
Loans and a valid pledge of and perfected security interest in the entire Trust
Estate, subject only to the provisions of the Indenture permitting the
application thereof for the purposes and on the terms and conditions set forth
therein. On the Closing Date, the Trustee will have legal title to the Trust
Estate for the benefit of EdLinc, including without limitation the Financed
Student Loans, and no lien other than the lien of the Indenture will exist with
respect to any asset which constitutes a part of the Trust Estate securing the
Notes.
(v) Neither EdLinc, SFLC or the Transferor nor any agent acting on
any of their behalf has taken or will take any action that might cause this
Agreement or the sale of the Notes to violate Regulations G, T, U, or X of the
Board of Governors of the Federal Reserve System, in each case as in effect, or
as the same may hereafter be in effect, as of the Closing.
(w) Other than as contemplated by this Agreement or as disclosed in
the Prospectus, there is no broker, finder or other party that is entitled to
receive from SLFC or any of its subsidiaries any brokerage or finder's fee or
other fee or commission as a result of any transactions contemplated by this
Agreement.
4. Agreements of EdLinc, SLFC and the Transferor
---------------------------------------------
EdLinc, SLFC and the Transferor agree with the Underwriter as follows:
(a) Prior to the execution of this Agreement, EdLinc has, pursuant to
Rule 424(b) under the Securities Act, prepared and filed a prospectus and
prospectus supplement, properly completed, with the Commission relating to the
Notes. EdLinc will advise the Underwriter promptly of any proposal to amend or
supplement the Registration Statement or the Prospectus and will not effect such
amendment or supplement without the consent of the Underwriter prior to the
Closing Date, and thereafter will not effect any such amendment or supplement
relating to or affecting the Notes to which the Underwriter reasonably objects;
provided, however, no consent of the Underwriter shall be required in connection
with any filing made pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and
-8-
Underwriting Agreement dated December 4, 2000
the rules and regulations promulgated thereunder; EdLinc will also advise the
Underwriter promptly of any request by the Commission for any amendment of or
supplement to the Registration Statement or the Prospectus or for any additional
information; and EdLinc will also advise the Underwriter promptly of the
effectiveness of the Registration Statement and of any amendment or supplement
to the Registration Statement or the Prospectus, of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the institution or known threat of any proceeding for that purpose,
of the suspension of the qualification of the Notes for offering or sale in any
jurisdiction, and of the initiation or threatening of any proceeding relating to
the offering or sale of the Notes; and EdLinc will use its best efforts to
prevent the issuance of any such stop order or other order preventing or
suspending the use of the Prospectus or suspending the qualification of the
Indenture or the Notes for offering or sale in any jurisdiction and, in the
event of the issuance of any stop order or of any other such order, promptly use
its best efforts to obtain the withdrawal of such order.
(b) If the delivery of a prospectus is required at any time under the
Securities Act after an event has occurred which results in the Prospectus, as
then amended or supplemented, including an untrue statement of a material fact
or omitting to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or, if for any other reason it shall be necessary to amend or
supplement the Prospectus to comply with the Securities Act, the Rules and
Regulations or the Trust Indenture Act, EdLinc and SLFC will notify the
Underwriter and, upon the Underwriter's request, prepare and file with the
Commission and furnish, without charge to the Underwriter and to any dealer in
securities, as many copies as the Underwriter may from time to time reasonably
request, an amendment or supplement to such Prospectus which corrects such
statement or omission or amendment that effects such compliance.
(c) EdLinc and SLFC will immediately inform the Underwriter (i) of
the receipt by EdLinc or SLFC of any communication from the Commission or any
state securities authority concerning the offering or sale of the Notes and (ii)
of the commencement of any lawsuit or proceeding to which EdLinc or SLFC is a
party relating to the offering or sale of the Notes.
(d) EdLinc will furnish to the Underwriter, without charge, copies of
the Registration Statement (at least one copy of which will be signed and
include all documents and exhibits thereto or incorporated by reference
therein), the Prospectus, and all amendments and supplements to such documents
relating to the Notes, in each case in such quantities as the Underwriter may
reasonably request.
(e) EdLinc, SLFC and the Transferor will cooperate with the
Underwriter and with its counsel in connection with the qualification of, or
procurement of exemptions with respect to, the Notes for offering and sale by
the Underwriter and by dealers, and with the determination of their eligibility
for investment, under the laws of such jurisdictions as the Underwriter may
designate and will file such consents to service of process or other documents
necessary or appropriate to effect such qualification or exemptions; provided
that in no event shall either the Transferor, SLFC or EdLinc be obligated to
qualify to do business in any jurisdiction where it is not now so qualified
(other than the State of South Dakota if not currently so qualified) or to take
any action which would subject it to service of process in suits, other than
-9-
Underwriting Agreement dated December 4, 2000
those arising out of the offering or sale of the Notes, in any jurisdiction
where it is not now so subject.
(f) EdLinc, SLFC and the Transferor consent to the use, in accordance
with the securities or Blue Sky laws of such jurisdictions in which the Notes
are offered by the Underwriter and by dealers, of the Prospectus.
(g) To the extent, if any, that the ratings provided with respect to
the Notes by the Rating Agencies are conditional upon the furnishing of
documents or the taking of any other actions by EdLinc, SLFC or the Transferor,
SLFC, EdLinc, SLFC and the Transferor shall cause to be furnished such documents
and such other actions to be taken.
(h) So long as any of the Notes are outstanding, EdLinc, SLFC or the
Transferor will furnish to the Underwriter (i) as soon as available, a copy of
each document relating to EdLinc, SLFC, the Transferor or the Notes required to
be filed with the Commission pursuant to the Exchange Act, or any order of the
Commission thereunder, and (ii) such other information concerning EdLinc, SLFC
or the Transferor, as the Underwriter may request from time to time.
(i) To make generally available to the Noteholders and the
Underwriter as soon as practicable, a copy of each Monthly Servicing Report (as
defined in the Indenture) required under the Indenture and the Servicing
Agreement, and to file with the Commission on Form 8-K such Monthly Servicing
Reports for at least 12 consecutive months beginning after the effective date of
the Registration Statement (as defined in Rule 158(c) under the Securities Act)
in compliance with Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including Rule 158).
(j) If this Agreement shall terminate or shall be terminated after
execution and delivery pursuant to any provisions hereof or if this Agreement
shall be terminated by the Underwriter because of any failure or refusal on the
part of EdLinc, SLFC or the Transferor to comply with the terms or fulfill any
of the conditions of this Agreement SLFC agrees to reimburse the Underwriter for
all out-of-pocket expenses (including, without limitation, fees and expenses of
its counsel; costs related to its due diligence investigation of EdLinc, SLFC
and the Transferor; costs of preparing to market and the actual marketing of the
Notes; and costs incurred in the performance of its obligations hereunder)
reasonably incurred by it in its role as Underwriter, but without any further
obligation on the part of SLFC for loss of profits or otherwise.
(k) The net proceeds from the sale of the Notes hereunder will be
applied substantially in accordance with the description set forth in the
Prospectus. EdLinc, SLFC and the Transferor will not take or omit to take any
action which will in any way cause the proceeds from the sale of the Notes to be
applied in a manner contrary to that provided for in the Prospectus and the
Indenture.
(l) Except as stated in this Agreement and in the Prospectus, neither
EdLinc, the Transferor nor SLFC has taken, nor will any of them take, and each
of them will use their best efforts to cause each of their respective directors
and officers not to take, directly or
-10-
Underwriting Agreement dated December 4, 2000
indirectly, any action designed to or that might reasonably be expected to cause
or result in stabilization or manipulation of the price of the Notes to
facilitate the sale or resale of the Notes; it being understood that no such
action of any Underwriter shall be deemed to be an action of EdLinc, the
Transferor or SLFC.
(m) [Reserved]
(n) Deposits required by the Indenture into the Acquisition Fund, the
Alternative Loan Guarantee Fund and the Reserve Fund shall be made on the
Closing Date.
(o) Other than pursuant to your consent and as permitted by the
Securities Act and the Rules and Regulations, EdLinc, SLFC and the Transferor
will not distribute any prospectus or other offering material in connection with
the offering of the Notes.
5. Indemnification and Contribution
--------------------------------
(a) SLFC agrees to indemnify and hold harmless the Underwriter and
each person, if any, who controls the Underwriter within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages, liabilities and expenses (including reasonable
costs of investigation) arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement, the Prospectus, or in any amendment or supplement thereto, or in any
application filed under the Blue Sky laws of any jurisdiction or other document
executed by EdLinc or SLFC for that purpose, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to the Underwriter
furnished in writing to EdLinc by the Underwriter expressly for use in
connection therewith. The foregoing indemnity agreement shall be in addition to
any liability which EdLinc or SLFC may otherwise have.
(b) If any action, suit or proceeding shall be brought against the
Underwriter or any person controlling the Underwriter in respect of which
indemnity may be sought against SLFC, the Underwriter or such controlling
person, as the case may be, shall promptly notify the party against whom
indemnification is being sought (the "indemnifying parties"), and such
indemnifying parties shall assume the defense thereof, including the employment
of counsel and payment of all reasonable fees and expenses. The Underwriter or
any such controlling person, as the case may be, shall have the right to employ
separate counsel in any such action, suit or proceeding and to participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of the Underwriter or such controlling person unless (i) the
indemnifying parties have agreed in writing to pay such fees and expenses, (ii)
the indemnifying parties have failed to assume the defense and employ counsel,
or (iii) the named parties to any such action, suit or proceeding (including any
impleaded parties) include both the Underwriter or such controlling person and
the indemnifying parties and the Underwriter or such controlling person shall
have been advised by its counsel that representation of such indemnified party
and any indemnifying party by the same counsel would be inappropriate under
applicable standards of
-11-
Underwriting Agreement dated December 4, 2000
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the indemnifying party shall not have the right to assume the defense
of such action, suit or proceeding on behalf of the Underwriter or such
controlling person). It is understood, however, that the indemnifying parties
shall, in connection with any one such action, suit or proceeding or separate
but substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for the Underwriter and
controlling persons not having actual or potential differing interests with the
Underwriter or among themselves, which firm shall be designated in writing by
the Underwriter, and that all such fees and expense shall be reimbursed on a
monthly basis. The indemnifying parties shall not be liable for any settlement
of any such action, suit or proceeding effected without their written consent,
but if settled with such written consent, or if there be a final judgment for
the plaintiff in any such action, suit or proceeding, the indemnifying parties
agree to indemnify and hold harmless the Underwriter and any such controlling
person from and against any loss, claim, damage, liability or expense by reason
of such settlement or judgment to the extent provided in paragraph (a).
(c) The Underwriter agrees to indemnify and hold harmless EdLinc and
SLFC and their respective directors and officers, and any person who controls
EdLinc or SLFC within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the indemnity from SLFC to the
Underwriter set forth in paragraph (a) hereof, but only with respect to
information relating to the Underwriter furnished in writing by the Underwriter
expressly for use under the caption "Plan of Distribution" in the Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus or "Blue Sky" applications. If any action, suit
or proceeding shall be brought against EdLinc or SLFC, any of their respective
directors or officers, or any such controlling person based on the Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus and in respect of which indemnity may be sought
against the Underwriter pursuant to this paragraph (c), the Underwriter shall
have the rights and duties given to SLFC by paragraph (b) above (except that if
SLFC shall have assumed the defense thereof, the Underwriter shall not be
required to do so, but may employ separate counsel therein and participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
Underwriter's expense), and EdLinc and SLFC, their respective directors and
officers, and any such controlling person shall have the rights and duties given
to the Underwriter by paragraph (b) above. The foregoing indemnity agreement
shall be in addition to any liability which the Underwriter may otherwise have.
(d) If the indemnification provided for in this Section 5 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by EdLinc
and SLFC on the one hand and the Underwriter on the other hand from the offering
of the Notes, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of EdLinc
-12-
Underwriting Agreement dated December 4, 2000
and SLFC on the one hand and the Underwriter on the other in connection with the
statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by EdLinc and SLFC on the one hand and the
Underwriter on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Notes (before deducting expenses)
received by EdLinc and SLFC bear to the total underwriting discounts and
commissions received by the Underwriter. The relative fault of EdLinc and SLFC
on the one hand and the Underwriter on the other hand 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 EdLinc or SLFC on the one hand or by the
Underwriter on the other hand and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
(e) EdLinc, SLFC and the Underwriter agree that it would not be just
and equitable if contribution pursuant to this Section 5 were determined by a
pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages liabilities and expenses referred to in paragraph (d) above
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 5, the Underwriter
shall not be required to contribute any amount in excess of the amount received
by the Underwriter over the price paid by the Underwriter for the Notes
purchased by them and distributed to the public less the amount of any damages
which the Underwriter has 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.
(f) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 5 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 5 and the
representations and warranties of EdLinc, SLFC, the Transferor and the
Underwriter set forth in this Agreement shall remain operative and in full force
and effect, regardless of (i) any investigation made by or on behalf of the
Underwriter, EdLinc, SLFC or the Transferor or any person controlling any of
them or their respective directors or officers, (ii) acceptance of any Notes and
payment therefor hereunder, and (iii) any termination of this Agreement. A
successor to the Underwriter, EdLinc or SLFC or any person controlling any of
them or their respective directors or officers, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 5.
6. Conditions of the Underwriter's Obligations
-------------------------------------------
The obligations of the Underwriter to purchase the Notes hereunder are
subject to the following conditions:
-13-
Underwriting Agreement dated December 4, 2000
(a) All actions required to be taken and all filings required to be
made by EdLinc, SLFC or the Transferor under the Securities Act and the Trust
Indenture Act prior to the sale of the Notes shall have been duly taken or made.
At and prior to the Closing Date, no stop order suspending the effectiveness of
the Registration Statement or the sale of the Notes or the qualification of the
Indenture shall have been issued and no proceedings for that purpose shall have
been instituted or, to the knowledge of EdLinc, SLFC, the Transferor or the
Underwriter, shall be contemplated by the Commission or any Blue Sky
Authorities.
(b) Any requests to the Commission for inclusion of additional or
supplemental information in the Registration Statement or the Prospectus shall
have been complied with by EdLinc, SLFC and the Transferor to your reasonable
satisfaction.
(c) Since the respective dates as of which information is given in
the Registration Statement (or any amendment or supplement thereto), except as
may otherwise be stated therein or contemplated thereby, there shall not have
occurred (i) any change, or any development involving a prospective change, in
or affecting the condition (financial or other) or net worth of EdLinc, SLFC or
the Transferor not contemplated by the Registration Statement, which in the
opinion of the Underwriter, would materially adversely affect the market for the
Notes, or (ii) any event or development which makes any statement made in the
Registration Statement or Prospectus untrue or which, in the opinion of EdLinc
and its counsel SLFC and its counsel, the Transferor and its counsel or the
Underwriter and its counsel, requires the filing of any amendment to or change
in the Registration Statement or Prospectus in order to state a material fact
required by any law to be stated therein or necessary in order to make the
statements therein not misleading, if amending or supplementing the Registration
Statement or Prospectus to reflect such event or development would, in the
opinion of the Underwriter, materially adversely affect the market for the
Notes.
(d) At the time of the Closing, (i) the Notes, each of the Basic
Documents, EdLinc's Program Agreements, the Transferor's Program Agreements,
SLFC's Program Agreements, the Investment Agreement, the Trustee's Program
Agreements, the Transferor Trustee's Program Agreements and this Agreement shall
have been duly authorized, executed and delivered, and in full force and effect,
and, in the case of the Notes, authenticated; (ii) EdLinc's Authorizing
Resolutions, SLFC's Authorizing Resolution and the Transferor's Authorizing
Resolution shall have been duly adopted by EdLinc, SLFC and the Transferor, as
applicable, and shall be in full force and effect; (iii) the contracts between
the United States Secretary of Education and each of the Guarantee Agencies
shall be duly authorized, executed and delivered and in full force and effect;
(iv) the documents referred to in clauses (i) through (iii) above shall be in
forms satisfactory to the Underwriter and shall not have been amended, modified
or supplemented from the respective forms heretofore delivered to the
Underwriter, except as may have been agreed to in writing by the Underwriter,
and EdLinc, SLFC and the Transferor shall have duly adopted and there shall be
in full force and effect such additional resolutions and agreements, as shall,
in the opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, Minneapolis, Minnesota, be necessary in
connection with the transactions contemplated hereby; and (v) EdLinc, SLFC, the
Transferor, the Trustee, the Auction Agent, the Broker-Dealers, the Investment
Agreement Provider, the Transferor's Trustee, the EdLinc 1998 Indenture Trustee,
AFSA, GLHESC and the Guarantee Agencies shall perform or have performed all
their respective obligations required under or specified in this Agreement, the
Basic Documents, the
-14-
Underwriting Agreement dated December 4, 2000
Investment Agreement, EdLinc's Authorizing Resolutions, SLFC's Authorizing
Resolution, the Transferor's Authorizing Resolution, EdLinc's Program
Agreements, the Transferor's Program Agreements, SLFC's Program Agreements and
the Trustee's Program Agreements, to be performed simultaneously with or prior
to Closing.
(e) The Underwriter shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇ & Whitney LLP, Special Counsel to EdLinc and the Transferor,
dated the Closing Date and addressed to the Underwriter, in form and scope
satisfactory to the Underwriter and its counsel.
(f) The Underwriter shall have received on the Closing Date the
approving opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, dated the Closing Date and in form
and scope satisfactory to the Underwriter and its counsel, and a letter
addressed to the Underwriter to the effect that the Underwriter may rely on such
opinion and consenting to the references to it in the Prospectus.
(g) The Underwriter shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇, counsel for EdLinc and SLFC, dated the Closing Date
and addressed to the Underwriter, in form and scope satisfactory to the
Underwriter and its counsel.
(h) The Underwriter shall have received on the Closing Date an
opinion of Davenport, Evans, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, counsel for the Trustee, the
EdLinc 1998 Indenture Trustee and the Transferor's Trustee, dated the Closing
Date and addressed to the Underwriter, in form and scope satisfactory to the
Underwriter and its counsel.
(i) The Underwriter shall have received on the Closing Date an
opinion of counsel for the Auction Agent, dated the Closing Date and addressed
to the Underwriter, in form and scope satisfactory to the Underwriter and its
counsel.
(j) The Underwriter shall have received on the Closing Date opinions
of counsel for the Investment Agreement Providers, dated the Closing Date and
addressed to the Underwriter, in form and scope satisfactory to the Underwriter
and its counsel.
(k) The Underwriter shall have received on the Closing Date opinions
of counsel for such Guarantee Agencies, if any, specified by the Underwriter,
each dated the Closing Date and addressed to the Underwriter, in form and scope
satisfactory to the Underwriter and its counsel.
(l) The Underwriter shall have received on the Closing Date an
opinion or opinions of ▇▇▇▇▇ & Lardner, counsel for the Underwriter, dated the
Closing Date, and addressed to the Underwriter, in form and scope satisfactory
to the Underwriter.
(m) The Underwriter shall have received on the Closing Date from ▇▇▇▇
▇▇▇▇▇▇ LLP, certified public accountants, a comfort letter dated the Closing
Date, and in form and substance satisfactory to the Underwriter, to the effect
that they have carried out certain specified procedures, not constituting an
audit, with respect to certain financial information pertaining to EdLinc and to
the Financed Student Loans and setting forth the results of such specified
procedures.
-15-
Underwriting Agreement dated December 4, 2000
(n) All the representations and warranties of EdLinc, SLFC and the
Transferor contained in this Agreement, EdLinc's Program Agreements, the
Transferor's Program Agreements, SLFC's Program Agreements and the Basic
Documents shall be true and correct in all material respects on and as of the
date hereof and on and as of the Closing Date as if made on and as of the
Closing Date.
(o) EdLinc, SLFC and the Transferor each shall have performed or
complied with any of its agreements herein contained and required to be
performed or complied with by it hereunder at or prior to the Closing Date.
(p) The Underwriter shall have received by instrument dated the
Closing Date (at the option of the Underwriter), in addition to the opinions
referred to in clauses (d) through (k) of this Section 6, the right to rely on
opinions provided by such counsel and all other counsel under the terms of the
Basic Documents or to ▇▇▇▇▇'▇ and Fitch.
(q) The Underwriter shall have received evidence satisfactory to them
that ▇▇▇▇▇'▇ and Fitch have rated (i) the Series 2000-1 Senior Notes "Aaa" and
"AAA", respectively, and (ii) the Series 2000-1 ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, "▇▇" and "A",
respectively, and there has not been any announcement by ▇▇▇▇▇'▇ or Fitch that
(Y) it is downgrading any of its ratings assigned to the Notes or (Z) it is
reviewing its ratings assigned to the Notes with a view to possible downgrading,
or with negative implications, or direction not determined.
(r) The Underwriter shall have received a certificate of the
President of EdLinc, SLFC and the Transferor, as applicable, affirming the
matters specified in Sections 6(n) through (q) and such other matters as the
Underwriter may reasonably request.
(s) The Underwriter shall have received (i) a certificate or
certificates from the Secretary or Assistant Secretary of each of EdLinc, SLFC
and the Transferor certifying and attaching copies of (A) organizational
documents, (B) resolutions authorizing this Agreement, the Basic Documents, the
Investment Agreement, EdLinc's Program Agreements, the Transferor's Program
Agreements, SLFC's Program Agreements and the transactions contemplated hereby
and thereby, (C) all written communications, and any memoranda relating to
conversations between such entity, its officers and employees or, to its
knowledge, its counsel, accountants or other representatives, on the one hand,
and the Commission or its staff, on the other hand, relating to the Registration
Statement and certifying the incumbency and signature of the officers executing
this Agreement, the Basic Documents, EdLinc's Program Agreements, the
Transferor's Program Agreements and SLFC's Program Agreements; and (ii)
certificates of legal existence and good standing with respect to SLFC from the
Secretary of State of the State of South Dakota and with respect to EdLinc and
the Transferor from the Secretary of State of the State of Delaware, dated as of
the Closing Date or such earlier date within two weeks of the Closing Date.
(t) The Underwriter shall have received a certificate of the Trustee,
signed by an officer of the Trustee, dated the Closing Date, (i) to the effect
that the Trustee received each of the items enumerated in Section 3.2 of the
Indenture; (ii) containing permission to include the information concerning the
Trustee in the Prospectus and to use the Basic Documents, the Investment
Agreement and the Trustee's Program Agreements in connection with the public
-16-
Underwriting Agreement dated December 4, 2000
offering of the Notes; (iii) representing that (A) the Basic Documents to which
the Trustee is a party, the Investment Agreement and the Trustee's Program
Agreements, have been duly authorized, executed and delivered on behalf of the
Trustee and are in full force and effect, (B) such agreements may be used in
connection with the public offering of the Notes, (C) the Trustee is an
"eligible lender" under the Higher Education Act of 1965, as amended, (D) no
litigation is pending or, to his or her knowledge, threatened in any court to
restrain or enjoin the issuance or delivery of any of the Notes, or the
collection of revenues pledged or to be pledged to pay the principal of, and
interest on, the Notes, or in any way contesting or affecting the validity or
enforceability of the Notes, the Basic Documents, the Investment Agreement, the
Trustee's Program Agreements or the Underwriting Agreement or the collection of
said revenues or the pledge thereof, (E) there is no litigation pending or to
his or her knowledge threatened against the Trustee, or involving any of the
property or assets under the control of the Trustee, which involves the
possibility of any judgment or liability which may materially adversely affect
the security for the Notes or the collection of revenues pledged or to be
pledged to pay the principal of, and interest on, the Notes or materially
adversely affect the Trustee or the Program (but in lieu of such certificate the
Underwriter may in its sole discretion accept an opinion of the Trustee's
counsel as to the matters referred to above, acceptable to the Underwriter in
form and substance, that in their opinion the issues raised in any such pending
or threatened litigation are without substance or that the contentions of the
plaintiffs therein are without merit), and (F) he or she has carefully examined
the Prospectus with respect to references to the Trustee and that, in his or her
opinion, with respect to references to the Trustee, as of the date of the
Prospectus and at all times subsequent through and including the Closing Date,
the Prospectus did not and does not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(u) The Underwriter shall have received certified copies of the Basic
Documents, EdLinc's Authorizing Resolutions, SLFC's Authorizing Resolution, the
Transferor's Authorizing Resolution, EdLinc's Program Agreements, the
Transferor's Program Agreements, SLFC's Program Agreements, in each case
certified as of the Closing Date by each corporation's respective corporate
Secretary to be a true and correct copy thereof and in full force and effect.
(v) The Underwriter shall have received certified copies of the
Trustee's Program Agreements and the Investment Agreement, in each case
certified as of the Closing Date by a duly authorized officer of the Trustee to
be a true and correct copy thereof and in full force and effect, and certified
copies of the Broker-Dealer Agreements, in each case certified as of the Closing
Date by a duly authorized officer of the respective the Broker-Dealers to be a
true and correct copy thereof and in full force and effect.
(w) The Underwriter shall have received certificates of the
Transferor's Trustee and the EdLinc 1998 Indenture Trustee, signed by an officer
of each such trustee, dated the Closing Date, (i) containing permission to
include the information concerning the Transferor's Trustee and the EdLinc 1998
Indenture Trustee, as applicable, in the Prospectus and to use the Transferor
Trustee's Program Agreements and the EdLinc 1998 Indenture Trustee's Program
Agreements, as applicable, in connection with the public offering of the Notes;
(ii) representing that (A) the Transferor Trustee's Program Agreements and the
EdLinc 1998 Indenture Trustee's Program Agreements have been duly authorized,
executed and delivered on
-17-
Underwriting Agreement dated December 4, 2000
behalf of the Transferor's Trustee and the EdLinc 1998 Indenture Trustee, as
applicable, and each is in full force and effect, (B) such agreements may be
used in connection with the public offering of the Notes, (C) the Transferor's
Trustee and the EdLinc 1998 Indenture Trustee is an "eligible lender" under the
Higher Education Act of 1965, as amended, (D) no litigation is pending or, to
his or her knowledge, threatened in any court in any way contesting or affecting
the validity or enforceability of the Transferor Trustee's Program Agreements
and the EdLinc 1998 Indenture Trustee's Program Agreements, (E) there is no
litigation pending or to his or her knowledge threatened against the
Transferor's Trustee or the EdLinc 1998 Indenture Trustee, or involving any of
the property or assets under the control of the Transferor's Trustee or the
EdLinc 1998 Indenture Trustee, which involves the possibility of any judgment or
liability which may materially adversely affect the security for the Notes or
materially adversely affect the Transferor's Trustee or the EdLinc 1998
Indenture Trustee or the Program (but in lieu of such certificate the
Underwriter may in its sole discretion accept an opinion of the Transferor's
Trustee counsel or the EdLinc 1998 Indenture Trustee's counsel as to the matters
referred to above, acceptable to the Underwriter in form and substance, that in
their opinion the issues raised in any such pending or threatened litigation are
without substance or that the contentions of the plaintiffs therein are without
merit), and (F) he or she has carefully examined the Prospectus with respect to
references to the Transferor's Trustee and the EdLinc 1998 Indenture Trustee, as
applicable, and that, in his or her opinion, with respect to references to the
Transferor's Trustee and the EdLinc 1998 Indenture Trustee, as applicable, as of
the date of the Prospectus and at all times subsequent through and including the
Closing Date, the Prospectus did not and does not contain any untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading;
(x) The Underwriter shall have received on the Closing Date
certificates of officers for such Guarantee Agencies and Sub-servicers, if any,
specified by the Underwriter, each dated the Closing Date, containing permission
to include the information concerning that entity in the Prospectus and covering
such other matters specified by the Underwriter, in form and scope satisfactory
to the Underwriter and its counsel.
(y) The Underwriter shall have received such additional certificates,
instruments and other documents as shall be requested by the Underwriter,
including, without limitation, from EdLinc, SLFC, the Transferor, the Trustee,
the Transferor's Trustee, the EdLinc 1998 Indenture Trustee, Sub-Servicers, the
Auction Agent, the Broker-Dealers, the Investment Agreement Provider, and such
Guarantee Agencies, if any, specified by the Underwriter.
All opinions, certificates, letters and other documents referred in
this Section 6 will be in compliance with the provisions hereof only if they are
reasonably satisfactory in form and substance to the Underwriter and counsel for
the Underwriter.
Any certificate or document signed by any officer of EdLinc, SLFC or
the Transferor and delivered to the Underwriter, or to counsel for the
Underwriter, shall be deemed a representation and warranty by EdLinc, SLFC or
the Transferor, respectively, to the Underwriter as to the statements made
therein.
-18-
Underwriting Agreement dated December 4, 2000
If these conditions are not satisfied, or if the obligations of the
Underwriter shall be terminated for any reason permitted by this Agreement, this
Agreement shall terminate and neither the Underwriter nor EdLinc, SLFC or the
Transferor shall be under further obligation hereunder, except that the
respective obligations of EdLinc, the Transferor and SLFC and the Underwriter
for the payment of expenses, as provided in Section 7 hereof, shall continue in
full force and effect.
7. Expenses
--------
EdLinc and SLFC, jointly and severally, agree to pay or to otherwise
cause the payment of the following costs and expenses and all other costs and
expenses incident to the performance by them and the Transferor of their
respective obligations hereunder: (i) the preparation, printing or reproduction
and distribution of any Registration Statement, each Prospectus and each
amendment or supplement thereto and each other Basic Document, EdLinc's Program
Agreement, the Transferor's Program Agreements, SLFC's Program Agreement, the
Investment Agreement and Trustee's Program Agreement; (ii) the preparation,
printing, authentication, issuance and delivery of definitive certificates for
the Notes; (iii) the qualification of the Indenture under the Trust Indenture
Act; (iv) the fees and disbursements of (A) counsel and Special Counsel for
EdLinc, SLFC and the Transferor, (B) the Trustee, the Transferor's Trustee, the
EdLinc 1998 Indenture Trustee and their respective counsel, (C) the Auction
Agent and its counsel, (D) any Guarantee Agencies and Sub-servicers and their
respective counsel, (E) the Investment Agreement Provider and its counsel, (F)
the Depository Trust Company in connection with the book-entry registration of
the Notes, (G) ▇▇▇▇ ▇▇▇▇▇▇ LLP, accountants for EdLinc, SLFC and the Transferor
and issuer of the specified procedures letter referenced in Section 6(m) hereof,
and (H) counsel for the Underwriter as set forth in Sections 1 and 2 hereof; (v)
the fees charged by ▇▇▇▇▇'▇ and Fitch for rating the Notes; (vi) the Blue Sky
filing fees and expenses; and (vii) the cost of any advertising expenses
requested or undertaken by EdLinc, SLFC or the Transferor and incurred in
connection with the public offering of the Notes. The Underwriter shall be under
no obligation to pay any expense incident to the performance of the obligations
of EdLinc, SLFC or the Transferor hereunder.
The Underwriter shall pay the expenses incurred by it in connection
with its public offering and distribution of the Notes (except as otherwise
provided in the preceding paragraph).
8. Nonpetition Covenant
--------------------
The Underwriter covenants and agrees that it will not at any time
institute against EdLinc or the Transferor, or join in any institution against
EdLinc or the Transferor of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any United
States Federal or state bankruptcy or similar law in connection with any
obligation relating to this Agreement.
9. Effective Date of Agreement
---------------------------
This Agreement shall become effective upon the execution and delivery
hereof by all the parties hereto.
-19-
Underwriting Agreement dated December 4, 2000
10. Representations, Warranties and Agreements to Survive Delivery
--------------------------------------------------------------
All representations, warranties and agreements contained in the
Agreement or contained in certificates of officers of EdLinc, SFLC or the
Transferor submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the
Underwriter or any officer, director, or controlling person of the Underwriter,
or by or on behalf of EdLinc, SFLC or the Transferor, and shall survive delivery
of the Notes to the Underwriter. The expense payment provisions set forth in
Sections 4(j) and 7 hereof and the indemnification and contribution provisions
in Section 5 hereof also shall survive delivery of the Notes to the Underwriter
and any termination or cancellation of this Agreement.
11. Termination of Agreement
------------------------
This Agreement shall be subject to termination in the absolute
discretion of the Underwriter, without liability on the part of the Underwriter
to EdLinc, SLFC or the Transferor, by notice to EdLinc, SLFC and the Transferor,
if on or prior to the Closing Date (i) trading in securities generally on the
New York Stock Exchange, American Stock Exchange or the Nasdaq National Market
shall have been suspended or materially limited; (ii) a general moratorium on
commercial banking activities in New York, Delaware or South Dakota shall have
been declared by either federal or state authorities; (iii) there shall have
occurred any outbreak or escalation of hostilities or other international or
domestic calamity, crisis or change in political, financial or economic
conditions, the effect of which on the financial markets of the United States is
such as to make it, in the judgment of the Underwriter, impracticable or
inadvisable to commence or continue the offering of the Notes on the terms set
forth in the Prospectus or to enforce contracts for the resale of the Notes by
the Underwriter; (iv) legislation shall be introduced in or enacted by the
Congress of the United States or adopted by either the House of Representatives
or the Senate or approved by a Committee thereof, or a decision by a court of
the United States or the Tax Court of the United States shall be rendered, or a
ruling, regulation, proposed regulation or official statement by or on behalf of
the Treasury Department of the United States, the Internal Revenue Service or
any other governmental agency shall be made, an announcement by a member of
Congress shall be made relating to legislation which has been introduced or
which is proposed to be introduced, or any other event shall occur, with respect
to federal taxation upon revenues or other income of the general character
expected to be pledged under the Indenture or upon interest received on
securities of the general character of the Notes, or which would have the effect
of changing, directly or indirectly, the federal income tax consequences of
interest on securities of the general character of the Notes in the hands of the
holders thereof, which in the opinion of the Underwriter materially and
adversely affects the market price of the Notes; (v) legislation shall be
enacted by the States of South Dakota or Delaware, or a decision by a court of
competent jurisdiction of the States of South Dakota or Delaware or any
administrative tribunal of the States of South Dakota or Delaware or other
governmental agency or department thereof shall be rendered with respect to
taxation by the States of South Dakota or Delaware or any of their respective
political subdivisions upon revenues or other income of the general character
expected to be pledged under the Indenture or upon interest received on
securities of the general character of the Notes, or which would have the effect
the changing, directly or indirectly, the tax consequences under the States of
South Dakota or Delaware tax laws of interest on securities of the general
character of the Notes in the hands of the holders thereof, which in the opinion
of the Underwriter materially affects the market price of the Notes; (vi)
-20-
Underwriting Agreement dated December 4, 2000
additional material restrictions not in force as of the date hereof shall have
been imposed upon trading in securities of the general character of the Notes by
any governmental authority or by any national securities exchange; (vii) a
default shall have occurred in the payment of principal or interest on
outstanding obligations of EdLinc, SLFC or the Transferor, the State of South
Dakota, or any agency or authority thereof, which in the opinion of the
Underwriter materially and adversely affects the market for the Notes; or (vii)
any rating of the Notes shall have been changed or withdrawn by ▇▇▇▇▇'▇ or
Fitch, or ▇▇▇▇▇'▇ or Fitch shall have announced that it is considering a change
or withdrawal of such rating and such action, in the opinion of the Underwriter,
shall materially and adversely affect the market for the Notes. Notice of such
termination may be given to EdLinc, SLFC and the Transferor, by telegram,
telecopy or telephone and shall be subsequently confirmed by letter.
12. Information Furnished by the Underwriter
----------------------------------------
The statements set forth under the heading "Underwriting" in the
Prospectus Supplement dated November 28, 2000 (the "Prospectus Supplement")
constitute the only information furnished by or on behalf of the Underwriter as
such information is referred to in Sections 3(b) and 5 hereof, and each
Underwriter confirms that such statements relating to such Underwriter are
correct.
13. Miscellaneous
-------------
Except as otherwise provided in Sections 4 and 11 hereof, notice given
pursuant to any provision of this Agreement shall be in writing and shall be
delivered (i) if to EdLinc, SLFC or the Transferor, at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: A. Norgrin ▇▇▇▇▇▇▇▇▇, (ii)
if to the Underwriter, to ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇.
This Agreement has been and is made solely for the benefit of, and
shall be binding upon, the Underwriter, the Transferor, SLFC, EdLinc, their
respective directors, officers, trustees and controlling persons referred to in
Section 5 hereof and their respective successors and assigns, to the extent
provided herein, and no other person shall acquire or have any right under or by
virtue of this Agreement. Neither the term "successor" nor the term "successors
and assigns" as used in this Agreement shall include a purchaser from the
Underwriter of any of the Notes in his status as such purchaser.
14. Applicable Law; Counterparts; Headings
--------------------------------------
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to contracts made and to be
performed within the State of New York without giving effect to the choice of
laws or conflict of laws principles thereof.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof or
thereof shall have been executed and delivered on behalf of each party hereto.
-21-
Underwriting Agreement dated December 4, 2000
The headings of the Sections of this Agreement are inserted for
convenience only and shall not be deemed to be part hereof.
[The remainder of this page is intentionally left blank.]
-22-
Underwriting Agreement dated December 4, 2000
Please confirm that the foregoing correctly sets forth the agreement
among EdLinc, SLFC, the Transferor and the Underwriter.
Very truly yours,
EDUCATION LOANS INCORPORATED
("EdLinc")
By /s/ A. Norgrin ▇▇▇▇▇▇▇▇▇
------------------------------------------
Name: A. Norgrin ▇▇▇▇▇▇▇▇▇
Title: President
STUDENT LOAN FINANCE CORPORATION
("SLFC")
By /s/ A. Norgrin ▇▇▇▇▇▇▇▇▇
------------------------------------------
Name: A. Norgrin ▇▇▇▇▇▇▇▇▇
Title: President
GOAL FUNDING, INC.
(the "Transferor")
By /s/ A. Norgrin ▇▇▇▇▇▇▇▇▇
------------------------------------------
Name: A. Norgrin ▇▇▇▇▇▇▇▇▇
Title: President
Confirmed as of the date first
above mentioned.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
-23-
Underwriting Agreement dated December 4, 2000
APPENDIX A
----------
Initial Aggregate Underwriting Initial
Series Principal Amount Maturity Date Purchase Price Discount Interest
------ ---------------- ------------- -------------- -------------- --------
Rate
----
2000-1A $ 54,100,000 December 1, 2035 99.562% 0.438% 6.85%
2000-1B 54,100,000 December 1, 2035 99.562 0.438 6.85
2000-1C 22,000,000 December 1, 2035 99.652 0.438 6.95
Total $130,200,000 $129,630,030 $569,970
-24-
Underwriting Agreement dated December 4, ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇
----------
CERTAIN DEFINITIONS
Capitalized terms used but not defined in this Appendix B or elsewhere
in this Agreement have the respective meanings ascribed thereto in the
Supplemental Indenture.
"AFSA" means AFSA Data Corporation, a Delaware corporation and a
wholly owned subsidiary of Fleet Holding Corp.
"AFSA Bailment Agreement" means the Bailment Agreement, dated as of
December 1, 1999 among AFSA, the Trustee and Edlinc.
"AFSA Sub-servicing Agreement" means the Secondary Market FFEL
Servicing Agreement, dated as of February 1, 1999, between AFSA and SLFC, as
amended.
"Bailment Agreements" means the SLFC Bailment Agreement, the AFSA
Bailment Agreement and the GLHESC Bailment Agreement.
"Basic Documents" means the Indenture, the Supplemental Indenture, the
Transfer Agreement, the Auction Agent Agreement, the Broker-Dealer Agreements,
the Servicing Agreement, the Bailment Agreements, the Joint Sharing Agreement
and the Letter of Representations.
"EdLinc's Authorizing Resolutions" means the Resolutions of EdLinc's
board of directors, adopting, accepting, ratifying and approving:
1. the Basic Documents;
2. this Agreement and the Prospectus;
3. one or more investment agreements (individually and collectively
the "Investment Agreement") between the Trustee and one or more
parties meeting the requirements of the Indenture (individually
and collectively the "Investment Agreement Provider");
4. the Transferor's Student Loan Purchase Agreements; and
5. EdLinc's Program Agreements.
"EdLinc ▇▇▇▇ ▇▇▇▇▇▇▇▇▇" means the Indenture of Trust, dated as of
February 1, 1998, between EdLinc and the EdLinc 1998 Indenture Trustee, as
amended and supplemented.
"EdLinc 1998 Indenture Trustee" means U.S. Bank National Association,
as trustee under the EdLinc 1998 Indenture.
"EdLinc 1998 Indenture Trustee Joint Sharing Agreement" means the
Joint Sharing Agreement, dated as of December 1, 1999, among EdLinc, the Trustee
and the EdLinc 1998 Indenture Trustee.
-25-
Underwriting Agreement dated December 4, 2000
"EdLinc 1998 Indenture Trustee's Program Agreements" means the EdLinc
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and the EdLinc 1998 Indenture Trustee Joint Sharing Agreement.
"EdLinc's Program Agreements" means the Bailment Agreements, the Joint
Sharing Agreements, the Servicing Agreement, the EdLinc 1998 Indenture and the
EdLinc Student Loan Purchase Agreements.
"EdLinc's Student Loan Purchase Agreements" means the Student Loan
Purchase Agreements between EdLinc and the eligible lenders described in Exhibit
H-1 to the Supplemental Indenture and the forms of Student Loan Purchase
Agreements.
"GLHESC" means Great Lakes Higher Education Services Corporation, a
non-corporation.
"GLHESC Bailment Agreement" means the Bailment Agreement, dated as of
December 1, 1999 among GLHESC, the Trustee and Edlinc.
"GLHESC Sub-servicing Agreement" means the Student Loan Origination
and Servicing Agreement, dated as of November 20, 1998, between AFSA and SLFC,
as amended.
"Goal Funding Indenture" means the Indenture, dated as of May 1, 1999,
among the Transferor's Trustee, the Transferor, Kitty Hawk Funding Corporation,
as the conduit lender, certain financial institutions identified therein, as the
alternative lenders, NationsBank, N.A., as the administrative agent, and Ambac
Assurance Corporation, as the surety bond provider, as amended and supplemented.
"Joint Sharing Agreement" means, collectively, the EdLinc 1998
Indenture Trustee Joint Sharing Agreement and the Transferor's Trustee Joint
Sharing Agreement.
"Letter of Representations" means, Book-Entry-Only Auction-Rate/Money
Market Preferred/and Remarketed Preferred Securities Letter of Representations,
dated as of December 1, 2000, from EdLinc and the Trustee to The Depository
Trust Company ("DTC"), containing certain representations to induce DTC to
accept the Notes for deposit.
"Loan Purchase Contracts" means, individually and collectively,
EdLinc's Student Loan Purchase Agreements and the Transferor's Student Loan
Purchase Agreements.
"Servicing Agreement" means the Servicing Agreement, as defined in the
Supplemental Indenture, including Amendment No. 1 to Servicing and
Administration Agreement, dated as of December 1, 2000, among EdLinc, SLFC and
the Trustee.
"SLFC's Authorizing Resolutions" means the Resolutions of the SLFC's
board of directors, adopting, accepting, ratifying and approving:
1. the Basic Documents, this Agreement and the Prospectus;
2. SLFC's Program Agreements; and,
-26-
Underwriting Agreement dated December 4, 2000
3. EdLinc's Program Agreements.
"SLFC Bailment Agreement" means the Bailment Agreement, dated as of
December 1, 1999 among SLFC, the Trustee and Edlinc.
"SLFC's Program Agreements" means the Servicing Agreement, the Sub-
servicing Agreements and the SLFC Bailment Agreement.
"Sub-servicers" means AFSA and GLHESC.
"Sub-servicing Agreements" means the AFSA Sub-servicing Agreement and
the GLHESC Sub-Servicing Agreement.
"Transferor's Authorizing Resolutions" means the Resolutions of the
Transferor's board of directors, adopting, accepting, ratifying and approving:
1. this Agreement and the Prospectus; and,
2. the Transferor's Program Agreements.
"Transferor's Program Agreements" means the Transfer Agreement, the
Goal Funding Indenture, the Transferor's Trustee Joint Sharing Agreement and the
Transferor's Student Loan Purchase Agreements.
"Transferor's Trustee Joint Sharing Agreement" means the Joint Sharing
Agreement, dated as of December 1, 1999, among EdLinc, the Transferor, the
Trustee and the Transferor's Trustee.
"Transferor's Student Loan Purchase Agreements" means the Student Loan
Purchase Agreements between the Transferor and the eligible lenders described in
Exhibit H-2 to the Supplemental Indenture.
"Transferor's Trustee" means U.S. Bank National Association, as
trustee under the Goal Funding Indenture.
"Transferor's Trustee's Program Agreements" means the Goal Funding
Indenture, the Transfer Agreement and the Transferor's Trustee Joint Sharing
Agreement.
"Trustee's Program Agreements" means the Guarantee Agreements.
-27-
