Scholastic Corporation
Preferred Stock
(par value $1 per share)
-------------------------
Underwriting Agreement
, 19..
[Name(s) of Representative(s),]
To the Representatives of the several
Underwriters named in the respective
Pricing Agreements hereinafter described.
Ladies and Gentlemen:
From time to time Scholastic Corporation, a Delaware corporation (the
"Company"), 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 issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain shares of its Preferred Stock, par value $1 per share
(the "Shares"). The shares of Preferred Stock are referred to as the "Firm
Shares" with respect to such Pricing Agreement and the shares of Preferred Stock
represented by such Pricing Agreement are referred to as the shares of
"Designated Preferred Stock" with respect to such Pricing Agreement. If
specified in such Pricing Agreement, the Company may grant the Underwriters the
right to purchase at their election an additional number of shares of Preferred
Stock, specified as provided in such Pricing Agreement as provided in Section 3
hereof (the "Optional Shares"). The Firm Shares and the Optional Shares, if any,
which the Underwriters elect to purchase pursuant to Section 3 hereof are herein
collectively referred to as the "Designated Shares". [The Designated Preferred
Stock may be [convertible] [exchangeable] into shares of Common Stock, par value
$.01 per share, of the Company (the "Stock") or debt securities of the [Company]
(the "Securities), as specified in Schedule II to such Pricing Agreement, which
are [convertible] [exchangeable] into shares of Stock, as specified in such
Pricing Agreement. The securities so specified, if any, are referred to in such
Pricing Agreement as the Designated Securities with respect to such Pricing
Agreement.]
The terms and rights of any particular issuance of Designated Shares
shall be as specified in the Pricing Agreement relating thereto.
1. Particular sales of Designated Shares may be made from time to
time to the Underwriters of such Shares, for whom the firms designated as
representatives of the Underwriters of such Shares in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole
representative of the Underwriters and to Underwriters who act without any firm
being designated as their representative. This Underwriting Agreement shall not
be construed as an obligation of the Company to sell any of the Shares or as an
obligation of any of the Underwriters to purchase any of the Shares. The
obligation of the Company to issue and sell any of the Shares and the obligation
of any of the Underwriters 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 the Firm Shares,
the maximum number of Optional Shares, if any, the initial public offering price
of such Firm and Optional Shares or the manner of determining such price, the
terms of the Designated Shares, including the terms on which and terms of the
securities into which the Designated Shares will be convertible or exchangeable,
the purchase price to the Underwriters of such Designated Shares, the names of
the Underwriters of such Designated Shares, the names of the Representatives of
such Underwriters, the number of such Designated Shares to be purchased by each
Underwriter 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 Firm
and Optional Shares, if any, and payment therefor. The Pricing Agreement shall
also specify (to the extent not set forth in the registration statement and
prospectus with respect thereto) the terms of such Designated Shares. 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. The obligations of the Underwriters under this
Agreement and each Pricing Agreement shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement on Form S-3 (File No [S].
333-.... ) (the "Initial Registration Statement") in respect of the
Shares [and the] [the Securities] [and the shares of Stock] has been
filed with the Exchange Commission (the "Commission"); such Initial
Registration Statement and any post-effective amendment thereto, each
in the form heretofore delivered or to be delivered to the
Representatives and, excluding exhibits to such registration statement,
but including all documents incorporated by reference in the prospectus
included therein in the such registration statement, to the
Representatives for each of the other Underwriters have been declared
effective by the Commission in such form; other than a registration
statement, if any, increasing the size of the offering (a "Rule 462(b)
Registration Statement"), filed pursuant to Rule 462(b) under the
Securities Act of 1933, as amended (the "Act"), which became effective
upon filing, no other document with respect to such 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 Act, each in the form heretofore delivered
to the Representatives); and no stop order suspending the effectiveness
of the Initial Registration Statement, any post-effective amendments
thereto or the Rule 462(b) Registration Statement, if any, 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 and the rule 462(b) Registration Statements, if any,
including all exhibits thereto and the documents incorporated by
reference in the prospectus contained in the registration statement at
the time such part of
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the registration statement became effective, but excluding Form T-1,
each as amended at the time such part of the registration statement
became effective, are hereinafter collectively called the "Registration
Statement"; the prospectus relating to the Shares [and the] [the
Securities] [and the shares of Stock], 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 excluding any documents or portions of such documents which are
deemed under the rules and regulations of the Commission under the Act,
not to be incorporated by reference, 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
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);
(b) 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; 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 an Underwriter of
Designated Shares through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Shares;
(c) 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 Trust Indenture Act of 1939, as amended
(the "Trust Indenture 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
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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, in the case of the Registration Statement, not
misleading, or, in the case of the Prospectus, in light of the
circumstances in which they were made, 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 an Underwriter of
Designated Shares through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Shares;
(d) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited consolidated financial
statements of the Company 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 (other than upon the exercise of
options pursuant to the Company's employee and director stock option
plans) or the exercise of conversion rights pursuant to any convertible
debt instrument issued by the Company 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, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(e) Each of the Company and its material subsidiaries listed
on Schedule III hereto (the "Material Subsidiaries") 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 its properties and conduct its
business as described in the Prospectus;
(f) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable [; the shares of Stock [initially issuable upon
[conversion] [exchange] of the Designated Shares] have been duly and
validly authorized and reserved for issuance and, when issued and
delivered in accordance with the provisions of the [Shares] [Securities
and the Indenture referred to below], will be duly and validly issued,
fully paid and non-assessable and will conform to the description of
the Stock contained in the Prospectus;];
(g) The Shares have been duly and validly authorized, and,
when the Firm Shares are issued and delivered and paid for by the
Underwriters pursuant to this Agreement and the Pricing Agreement with
respect to such Designated Shares and, in the case of any Optional
Shares, pursuant to Over-allotment Options (as defined in Section 3
hereof) with respect to such Shares, such Designated Shares will be
duly and validly issued and 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
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contained in the Prospectus as amended or supplemented with respect
to such Designated Shares;
(h) 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 each Over-allotment Option, if any, 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 (after
giving effect to any amendment or waiver of the terms thereof) to which
the Company or any of its Material Subsidiaries is a party or by which
the Company or any of its Material Subsidiaries is bound or to which
any of the property or assets of the Company or any of its Material
Subsidiaries is subject, except for such breaches or violations that
will not have a material adverse effect on the current or future
financial position, stockholders equity or results of operations of the
Company and its subsidiaries taken as a whole, 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 to the best
knowledge of the Company, after reasonable investigation, 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 or
any Over-allotment Option, 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 the Trust Indenture 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; and such
consents, approvals, authorizations, registrations or qualifications as
may be required under state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters;
(i) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its Material Subsidiaries is a party or of which any of their
properties, property of the Company or any of its Material 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 taken as a whole; and, to the best of the
Company's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others;
(j) Neither the Company nor any of its Material Subsidiaries
is (i) in violation of its Certificate of Incorporation or By-laws or
(ii) 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 (after giving effect to any amendment or waiver
of the terms thereof) to which it is a party or by which it or any of
its properties may be bound, except in the case of (ii) for such
breaches or violations that will not have a material adverse effect on
the current or future financial
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position, stockholders equity or results of operations of the Company
and its subsidiaries taken as a whole;
(k) The statements set forth in the Prospectus under the
caption "Description of Preferred Stock"[,] [and] ["Description of
Securities"] ["Description of Capital Stock"], insofar as they purport
to constitute a summary of the terms of the Preferred Stock, [the
Stock][,] [the Securities][, respectively][, under the caption
["Taxation"],] 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;
(l) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company" or
an entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act") required to be registered under the
Investment Company Act;
[[(m)] The Securities, if any, have been duly authorized and,
when issued and delivered pursuant to this Agreement, upon exchange of
the Shares will have been duly executed, authenticated, issued and
delivered and will constitute valid and legally binding obligations of
the Company entitled to the benefits provided by the indenture to be
dated as of ............., 19.. (the "Indenture") between the Company
and .........., as Trustee (the "Trustee"), under which they are to be
issued, which will be substantially in the form filed as an exhibit to
the Registration Statement; the Indenture has been duly authorized and
duly qualified under the Trust Indenture Act and, when executed and
delivered by the Company and the Trustee, will constitute a valid and
legally binding instrument, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the Securities,
and the Indenture will conform to the descriptions thereof in the
Prospectus;]
[(n)] Ernst & Young 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.
[(o)] The Company and its Material Subsidiaries own and have
fully sufficient right to use all trademarks, service marks, trade
names, copyrights and similar rights used in the business conducted or
proposed to be conducted by them as described in the Prospectus, except
such rights as are not, individually or in the aggregate, materially
important to the business conducted or proposed to be conducted by them
as described in the Prospectus, and neither the Company nor any of its
Material Subsidiaries has received any notice of infringement of or
conflict with (or knows of any such infringement of or conflict with)
asserted rights of others with respect to such trademarks, service
marks, trade names, copyrights or similar rights, other than such
infringements or conflicts that would not, individually or in the
aggregate, have a material adverse effect on the business conducted or
proposed to be conducted by the Company and its Material Subsidiaries
as described in the Prospectus.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Shares and authorization by the Representatives of the release of the
Firm Shares, the several Underwriters
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propose to offer the Firm Shares for sale upon the terms and conditions set
forth in the Prospectus as amended or supplemented.
The Company may specify in the Pricing Agreement applicable to any
Designated Shares that the Company thereby grants to the Underwriters the right
(an "Overallotment Option") to purchase at their election up to the number of
Optional Shares set forth in such Pricing Agreement, on the terms set forth in
the paragraph above, for the sole purpose of covering over-allotments in the
sale of the Firm Shares. Any such election to purchase Optional Shares may be
exercised by written notice from the Representatives to the Company, given
within a period specified in the Pricing Agreement, setting forth the aggregate
number of Optional Shares to be purchased and the date on which such Optional
Shares are to be delivered, as determined by the Representatives but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless the Representatives and the Company otherwise agree in writing, earlier
than or later than the respective number of business days after the date of such
notice set forth in such Pricing Agreement.
The number of Optional Shares to be added to the number of Firm Shares
to be purchased by each Underwriter as set forth in Schedule I to the Pricing
Agreement applicable to such Designated Shares shall be, in each case, the
number of Optional Shares which the Company has been advised by the
Representatives have been attributed to such Underwriter; provided that, if the
Company has not been so advised, the number of Optional Shares to be so added
shall be, in each case, that proportion of Optional Shares which the number of
Firm Shares to be purchased by such Underwriter under such Pricing Agreement
bears to the aggregate number of Firm Shares (rounded as the Representatives may
determine to the nearest 100 shares). The total number of Designated Shares to
be purchased by all the Underwriters pursuant to such Pricing Agreement shall be
the aggregate number of Firm Shares set forth in Schedule I to such Pricing
Agreement plus the aggregate number of Optional Shares which the Underwriters
elect to purchase.
4. Certificates for the Firm Shares and the Optional Shares to be
purchased by each Underwriter 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 Representatives may request
upon at least forty-eight hours' prior notice to the Company, shall be delivered
by or on behalf of the Company to the Representatives for the account of such
Underwriter, against payment by such Underwriter or on its behalf of the
purchase price therefor to the Company in immediately available funds specified
in such Pricing Agreement, (i) with respect to the Firm Shares, 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 Representatives and the Company may
agree upon in writing, such time and date being herein called the "First Time of
Delivery" and (ii) with respect to the Optional Shares, if any, in the manner
and at the time and date specified by the Representatives in the written notice
given by the Representatives of the Underwriters' election to purchase such
Optional Shares, or at such other time and date as the Representatives and the
Company may agree upon in writing, such time and date, if not the First Time of
Delivery, herein called the "Second Time of Delivery". Each such time and date
for delivery is herein called a "Time of Delivery".
5. The Company agrees with each of the Underwriters of any Designated
Shares:
(a) To prepare the Prospectus as amended and supplemented
in relation to the applicable Designated Shares in a form approved by
the Representatives and to file such
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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 which shall be
disapproved by the Representatives for such Shares promptly after
reasonable notice thereof; to advise the Representatives promptly of
any such amendment or supplement after any Time of Delivery for such
Shares and furnish the Representatives with copies thereof; if the
Company elects to rely upon Rule 462(b), the Company shall file a Rule
462(b) Registration Statement with the Commission in compliance with
Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement, and the Company shall at the time of filing either pay to
the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act; 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 Representatives,
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 [or the Securities] [or the Shares of
Stock, if any, issuable upon [conversion] [exchange] of the [Shares]
[Securities] 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
Representatives may reasonably request to qualify such Shares [or the
Securities] [or the Shares of Stock, if any, issuable upon [conversion]
[exchange] of the [Shares] [Securities] for offering and sale under the
securities laws of such jurisdictions as the Representatives 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 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 copies of the Prospectus as
amended or supplemented in New York City in such quantities as the
Representatives may from time to time reasonably request, and, if the
delivery of a prospectus is required at any time in connection with the
offering or sale of the Shares [or the Securities] [or the Shares of
Stock, if any, issuable upon [conversion] [exchange] of the [Shares]
[Securities] and if at such time any event shall have occurred as
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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 Representatives 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 copies as the
Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance;
(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); and
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Shares and continuing to and including
the later of (i) the termination of trading restrictions for such
Designated Shares, as notified to the Company by the Representatives
and (ii) the last Time of Delivery for such Designated Shares, 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 Designated Shares, including but not
limited to any securities that are convertible into or exchangeable
for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to employee stock
option plans existing on, or upon the conversion of convertible or
exchangeable securities outstanding as of, the date of the Pricing
Agreement for such Designated Shares) without the prior written consent
of the Representatives;
[[(f)] To use its best efforts to [list, subject to notice
of issuance, the [Preferred Stock] [Shares] [Stock issuable upon
[conversion][exchange] of the [Securities] [Shares]] on the
.................. Stock Exchange (the "Exchange")] [list for
quotation the [Preferred Stock][Shares] [Stock issuable upon
[conversion][exchange] of the [Securities] [Shares]] on the
National Association of Securities Dealers Automated Quotations
National Market (NASDAQ")]][;] [and][.]
[(g) Prior to .............., 19.., to cause to be registered,
pursuant to an effective registration statement under the Act, the
shares of Stock issuable upon [conversion][exchange] of the
[Securities] [the Shares] and to use its best efforts to maintain the
effectiveness of such registration statement during the entire period
during which the [Securities] [the Shares] may be [converted]
[exchanged];[;] [and][.]
[(h) To reserve and keep available at all times, free of
preemptive rights, shares of Stock for the purpose of enabling the
[Company] to satisfy any obligation to issue shares of its Stock upon
[conversion] [exchange] of the [Securities] [the Shares.]
6. The Company covenants and agrees with the several
Underwriters that the Company will pay or cause to be paid the following:
(i) the fees, disbursements and expenses of the
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Company's counsel and accountants in connection with the registration of the
Shares[, the Securities] [and the Shares of Stock issuable upon [conversion]
[Securities] 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 any Agreement among Underwriters, this
Agreement, any Pricing Agreement, the Indenture, the Securities, any Blue Sky
Memorandum, closing documents (including any 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[,
the Securities] [and the Shares of Stock issuable upon [conversion] [Securities]
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 fees charged by securities rating services for rating the
Shares; (v) 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; (vi) any fees and expenses in connection with listing the Shares [and]
[,] [the Stock] [and the Securities]; (vii) the cost of preparing certificates
for the Shares; (viii) the cost and charges of any transfer agent or registrar
or dividend disbursing agent; and (ix) all other costs and expenses incident to
the performance of its obligations hereunder and under any Over-allotment
Options which are not otherwise specifically provided for in this Section. It is
understood, however, that, except as provided in this Section, and Sections 8
and 11 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, in
the discretion of the Representatives, to the condition that all representations
and warranties and other statements of the Company 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 shall have performed all of its 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; if the Company has elected to rely
upon Rule 462(b), the Rule 462(b) Registration Statement shall have
become effective by 10:00 p.m., Washington, D.C. time, on the date of
this Agreement. 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
Representatives' reasonable satisfaction;
(b) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Underwriters, shall
have furnished to you such opinion or opinions dated such Time of
Delivery, with respect to the incorporation of the Company, the
validity of the shares [, Indenture, the Securities, the Stock], the
Registration Statement, the Prospectus and such other related matters
as you may
-10-
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) Coudert Brothers, counsel for the Company, shall have
furnished to the Representatives their written opinions (a draft of
each such opinion is attached as Annex II(a) hereto), dated each Time
of Delivery for such Designated Shares, respectively, in form and
substance satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware, with 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 (giving
effect to the assumptions set forth therein), 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 and validly authorized and issued and are fully
paid and non-assessable; [and the shares of Stock [initially
issuable upon [conversion][exchange] of the [Securities]
[Shares] have been duly and validly authorized and reserved
for issuance and, when issued and delivered in accordance with
the provisions of the [Securities and the Indenture] [Shares],
will be duly and validly issued and fully paid and
non-assessable, and will conform to the description the Stock
contained in the Prospectus;] and the Designated Shares
[and][,] [the Stock] [and the Preferred Stock] conform to the
description of the Stock contained 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 Material Domestic Subsidiaries is a party or of
which any property of the Company or any of its Material
Domestic Subsidiaries is the subject which, if determined
adversely to the Company or any of its Material Domestic
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 Material Domestic
subsidiaries taken as a whole; 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 issue and sale of the Designated Shares being
delivered at such Time of Delivery and 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 or any of its Material
Subsidiaries is a party or by which the Company is bound or to
which any of the property or assets of the Company or any of
its Material
-11-
Subsidiaries is subject, except for such breaches or
violations that will not have a material adverse effect on the
current or future financial position, stockholders equity or
results of operations of the company and its subsidiaries
taken as a whole, 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 to the best knowledge
of the Company, after reasonable investigation, 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 Material Subsidiaries 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 to be obtained or made
under the Federal laws of the United States of America, the
laws of the State of New York or the General Corporation Law
of the State of Delaware 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 as shall have been obtained under the Act or the
Exchange Act, or the rules and regulations thereunder, or the
bylaws and rules of the National Association of Securities
Dealers, Inc., 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 [the shares of Stock
issuable upon [exchange] [conversion] of the [Shares]
[Securities] [and the Securities] by the Underwriters;
(vii) Neither the Company nor any of its Material
Subsidiaries is (i) in violation of its Certificate of
Incorporation or By-laws or (ii) 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, except, in the case of (ii) for such breaches or
violations that will not have a material adverse effect on the
current or future financial position, stockholders equity or
results of operations of the company and its subsidiaries
taken as a whole;
(viii) The statements set forth in the Prospectus
under the caption [Description of "Preferred Stock"]
["Description of Securities"] ["Description of Capital
Stock"], insofar as they purport to constitute a summary of
the terms of the Preferred Stock, the Shares [the
Securities][, under the caption ["Taxation"],] 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;
[[(ix)] The Securities have been duly authorized,
executed, and authenticated, and when issued and delivered
upon exchange of the Shares will constitute valid and legally
binding obligations of the Company entitled to the benefits
provided by the Indenture; and the Securities and the
Indenture conform to the descriptions thereof in the
Prospectus; the Indenture has been duly authorized, executed
and delivered by the parties thereto and constitutes a valid
and legally binding instrument, enforceable in accordance with
its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general
applicability relating to or affecting creditors'
-12-
rights and to general equity principles; and the Indenture
has been duly qualified under the Trust Indenture Act;]
(x) ▇▇▇▇▇▇▇▇▇▇ ▇▇▇. is the registered owner of the
trademark "Scholastic"; to the best of such counsel's
knowledge neither the Company nor any of its Material
Domestic Subsidiaries has received any notice of
infringement of or conflict with (or knows of any such
infringement of or conflict with) asserted rights of others
with respect to such trademark;
(xi) The Company is not an "Investment Company" or an
entity "controlled" by an "Investment Company", as such terms
are defined in the Investment Company Act required to be
registered as such;
(xii) 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;
such counsel has 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 which 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
(xiii) 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), and in giving its opinion
required by this section 7(c) counsel shall additionally state
that nothing has come to its attention to lead it 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
-13-
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 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;
In giving its opinion required by this Section 7(c),
such counsel may state that such opinion described above is
limited to the Federal laws of the United States of America,
the laws of the States of New York and California and the
General Corporation Law of the State of Delaware.
(d) At 10:00 a.m. New York City time, on the business day
preceding the date of the Pricing Agreement for such Designated Shares
and at each Time of Delivery for such Designated Shares, Ernst & Young
LLP 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 Representatives a letter, dated
the effective date of the Registration Statement or the date of the
most recent report filed with the Commission containing financial
statements and incorporated by reference in the Registration Statement,
if the date of such report is later than such effective date, and a
letter dated such Time of Delivery, respectively, to the effect set
forth in Annex II hereto, and with respect to such letter dated such
Time of Delivery, as to such other matters as the Representatives may
reasonably request and in form and substance satisfactory to the
Representatives;
(e) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited consolidated
financial statements of the Company 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 (other than upon the exercise of options pursuant to the
Company's employee and director stock option plans) 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
-14-
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 Representatives 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;
(f) 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 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;
(g) 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 or on NASDAQ; (ii)
a suspension or material limitation in trading in the Company's
securities on NASDAQ; (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 or (v) a change in the national or international political,
financial or economic conditions or currency exchange rates or controls
if the effect of any such event specified in clauses (iv) or (v) is in
the judgment of the Representatives so material and adverse as to make
it impracticable or inadvisable to proceed with the public offering or
the delivery of the Firm Shares or Optional Shares or both on the terms
and in the manner contemplated in the Prospectus as first amended or
supplemented relating to the Designated Shares;
(h) The Shares at each Time of Delivery shall have been duly
listed, subject to notice of issuance, on the Exchange for quotation on
NASDAQ National Market System; and
(i) 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 this Agreement;
(j) The Company shall have furnished or caused to be furnished
to the Representatives at each Time of Delivery for the Designated
Shares certificates of officers of the Company satisfactory to the
Representatives 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 (e) of this Section and as to such
other matters as the Representatives may reasonably request; and
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter 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
-15-
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 each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that the
Company shall be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is 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 any Underwriter
of Designated Shares through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Shares.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company 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 such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company 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. Each indemnified party will cooperate fully with respect
to all aspects of any matter to which indemnification is being sought. No
indemnifying party shall, without the written consent of the indemnified party,
effect the settlement
-16-
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 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. An indemnifying party shall
not be required to indemnify an indemnified party for the amount paid or payable
by the indemnified party in the settlement of any claim, action, proceeding or
investigation undertaken without the prior written consent of the indemnifying
party, which consent shall not be unreasonably withheld.
(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 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 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 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 Company bear 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 on the one hand or such
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 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 (even if the Underwriters were treated as one entity for such
purpose) 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),
no Underwriter shall 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 such 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
-17-
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. The
obligations of the Underwriters of Designated Shares in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations with respect to such Shares and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter 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 respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Firm Shares or Optional Shares which it has agreed to purchase under the
Pricing Agreement relating to such Shares, the Representatives may in their
discretion arrange for themselves or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter the Representatives do not arrange for the purchase
of such Firm Shares or Optional Shares, as the case may be, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the Representatives to
purchase such Shares on such terms. In the event that, within the respective
prescribed period, the Representatives notify the Company that they have so
arranged for the purchase of such Shares, or the Company notifies the
Representatives that it has so arranged for the purchase of such Shares, the
Representatives or the Company shall have the right to postpone a Time of
Delivery for such Shares for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Representatives may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to the Pricing Agreement with respect to such Designated Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Firm Shares or Optional Shares, as the case may be, of a defaulting Underwriter
or Underwriters by the Representatives and the Company as provided in subsection
(a) above, the aggregate number of such Shares which remains unpurchased does
not exceed one-eleventh of the aggregate number of the Firm Shares or Optional
Shares, as the case may be, to be purchased at the respective Time of Delivery,
then the Company shall have the right to require each non-defaulting Underwriter
to purchase the number of Firm Shares or Optional Shares, as the case may be,
which such Underwriter agreed to purchase under the Pricing Agreement relating
to such Designated Shares and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Firm Shares
or Optional Shares, as the case may be, which such Underwriter agreed to
purchase under such Pricing Agreement) of the Firm Shares or Optional Shares, as
the case may be, of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of
the Firm Shares or Optional Shares, as the case may be, of a defaulting
Underwriter or Underwriters by the
-18-
Representatives and the Company as provided in subsection (a) above, the
aggregate number of Firm Shares or Optional Shares, as the case may be, which
remains unpurchased exceeds one-eleventh of the aggregate number of the Firm
Shares or Optional Shares, as the case may be, to be purchased at the respective
Time of Delivery, as referred to in subsection (b) above, or if the Company
shall not exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Firm Shares or Optional Shares, as the
case may be, of a defaulting Underwriter or Underwriters, then the Pricing
Agreement relating to such Firm Shares or the Over-allotment Option relating to
such Optional Shares, as the case may be, shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company, except
for the expenses to be borne by the Company and the Underwriters as provided in
Section 6 hereof and the indemnity and contribution agreements in Section 8
hereof; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several 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 any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If any Pricing Agreement or Over-allotment Option shall be
terminated pursuant to Section 9 hereof, the Company shall then be under any
liability to any Underwriter with respect to the Firm Shares or Optional Shares
with respect to which such Pricing Agreement shall have been terminated except
as provided in Sections 6 and 8 hereof; but, if for any other reason, Designated
Shares are not delivered by or on behalf of the Company as provided herein, the
Company agrees to reimburse the Underwriters through the Representatives for all
out-of-pocket expenses approved in writing by the Representatives, including
fees, disbursements and expenses of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of such
Designated Shares not so delivered, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Shares
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters
of Designated Shares shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
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 the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to Scholastic Corporation, ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Senior Vice President - Legal and Business
Affairs, facsimile transmission no. (▇▇▇) ▇▇▇-▇▇▇▇ set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its [address of
Representative(s)], which address will be supplied to the Company by the
Representatives upon
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request. Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. 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.
15. This Agreement and each Pricing Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in seven 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 [one for the Company and one for each of the Representatives
plus one for each counsel] counterparts hereof.
Very truly yours,
Scholastic Corporation
By: ..........................
Name:
Title:
Accepted as of the date hereof:
[Name(s) of Representative(s)]
By:]................................
[Name(s) of Representative
Corporation(s)]
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By:.................................
Name:
Title:
....................................
[(Name(s) of Co-Representative
Partnership(s))]]
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ANNEX I
Pricing Agreement
[Name(s) of Co-Representative(s),]
As Representatives of the several
Underwriters named in Schedule I hereto,
, 19..
Ladies and Gentlemen:
Scholastic Corporation, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated .......... , 19.. (the "Underwriting
Agreement"), between the Company on the one hand [and (names of
Representatives named therein)] on the other hand, to issue and sell to
the Underwriters named in Schedule I hereto (the "Underwriters") the
Shares specified in Schedule II hereto (the "Designated Shares"
[consisting of Firm Shares and any Optional Shares the Underwriters may
elect to purchase). [The Designated Shares are [convertible]
[exchangeable] into shares of Common Stock, par value $.01 per share, of
the Company (the "Stock") or debt securities of the Company (the
"Securities"), as specified in Schedule II to this Agreement, which are
[convertible] [exchangeable] into shares of Stock, as specified in
Schedule II to this Agreement. The Securities so specified, if any, are
referred to in this Agreement as the Designated Securities with respect
to this Agreement.] 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. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to
refer to you. Unless otherwise defined herein, terms defined in the
Underwriting Agreement are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and
on behalf of each of the Underwriters of the Designated Shares pursuant
to Section 12 of the Underwriting Agreement and the address of the
Representatives referred to in such Section 12 are set forth in Schedule
II hereto.
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 Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I hereto [and, (b) in the event and to the extent that the Underwriters
shall exercise the election to purchase Optional Shares, as provided below, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the
Company at the purchase price to the Underwriters set forth in Schedule II
hereto that portion of the number of Optional Shares as to which such election
shall have been exercised].
[The Company hereby grants to each of the Underwriters the right to
purchase at their election up to the number of Optional Shares set forth
opposite the name of such Underwriter in Schedule I hereto on the terms referred
to in the paragraph above for the sole purpose of covering over-allotments in
the sale of the Firm Shares. Any such election to purchase Optional Shares may
be exercised by written notice from the Representatives to the Company given
within a period of 30 calendar days after the date of this Pricing Agreement,
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by the
Representatives, but in no event earlier than the First Time of Delivery or,
unless the Representatives and the Company otherwise agree in writing, no
earlier than two or later than ten business days after the date of such notice.]
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If the foregoing is in accordance with your understanding, please sign
and return to us one for the Company and one for each of the Representatives
plus one for each counsel counterparts hereof, and upon acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof, including the provisions of the Underwriting Agreement incorporated
herein by reference, shall constitute a binding agreement between each of the
Underwriters and the Company. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is or will be pursuant to the
authority set forth in a form of Agreement among Underwriters, the form of which
shall be submitted to the Company for examination, upon request, but without
warranty on the part of the Representatives as to the authority of the signers
thereof.
Very truly yours,
Scholastic Corporation
By: ...............................
Name:
Title:
Accepted as of the date hereof:
[Name(s) of Representative(s)]
[By: ]..............................
[[Name(s) of Representative Corporation(s)]
By:.................................
Name:
Title:
....................................
[(Name(s) of Co-Representative Partnership(s))]]
On behalf of each of the Underwriters
-3-
SCHEDULE I
[Maximum Number
of Optional
Number of Shares Which
[Firm(20)] Shares May be
Underwriter to be Purchased Purchased
---------- --------------- ---------
..........................................
[Name(s) of Representative(s)]............
[Names of other Underwriters].............
Total (20)]
-4-
SCHEDULE II
Title of Designated Shares:
[[Depositary Shares]
Depositary:
Deposit Agreement, dated .................., 19..
Each Depositary Share represents ................... share
of [Title of Securities]
[Convertible] [Exchangeable] into .................. shares
of [Title of Securities] [Securities]
[The Securities are convertible into ................. shares of Stock]
Number of Designated Shares:
Number of Firm Shares:
Maximum Number of Optional Shares:
Initial Offering Price to Public:
[$........ per Share] [Formula]
Purchase Price by Underwriters:
[$........ per Share] [Formula]
[Commission Payable to Underwriters:
$........ per Share in [specify same form of funds as in Specified Funds below]]
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 Representatives]]
[Book-entry only form represented by one or more global securities deposited
with The Depository Trust Company ("DTC") or its designated custodian, to be
made available for checking by the Representatives at least twenty-four hours
prior to the Time of Delivery at the office of DTC.]
Specified Funds for Payment of Purchase Price:
[Federal (next day)][New York] Clearing House (next day) funds
[Describe any blackout provisions with respect to the Designated Shares]
Time of Delivery:
........ a.m. (New York City time), ................., 19..
Closing Location:
-5-
Names and addresses of Representatives:
Designated Representatives:
Address for Notices, etc.:
[Other Terms]:
-6-
SCHEDULE III
Material Subsidiaries
Material Domestic Subsidiaries
▇▇▇▇▇▇▇▇▇▇ ▇▇▇.
Scholastic Book Fairs, Inc.
California School Book Fairs, Inc.
Scholastic Book Clubs, Inc.
Scholastic Productions, Inc.
Scholastic Trumpet Book Clubs, Inc.
Material Foreign Subsidiaries
Scholastic Australia Pty. Ltd.
Scholastic Canada Ltd.
Scholastic New Zealand Ltd.
Scholastic Ltd.
-7-
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that (a similar letter
shall be provided for the Guarantor in which all references to the "Company" are
changed to the "Guarantor"):
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act or the Exchange
Act, as applicable, and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance
with standards established by the American Institute of Certified
Public Accountants of the consolidated interim financial statements,
selected financial data, pro forma financial information, financial
forecasts and/or condensed financial statements derived from audited
financial statements of the Company for the periods specified in such
letter, as indicated in their reports thereon, copies of which have
been [separately] furnished to the representatives of the Underwriters
(the "Representatives") [and are attached hereto];
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in the Company's quarterly
reports on Form 10-Q incorporated by reference into the Prospectus as
indicated in their reports thereon copies of which [have been
separately furnished to the Representatives] [are attached hereto]; and
on the basis of specified procedures including inquiries of officials
of the Company who have responsibility for financial and accounting
matters regarding whether the unaudited condensed consolidated
financial statements referred to in paragraph (vi)(A)(i) below comply
as to form in all material respects with the applicable accounting
requirements of the [Act and the Exchange] Act and the related
published rules and regulations, nothing came to their attention that
caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects
with the applicable accounting requirements of the [Act and the
Exchange] Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the
Prospectus and included or incorporated by reference in Item 6 of the
Company's Annual Report on Form 10-K for the most recent fiscal year
agrees with the corresponding amounts (after restatement where
applicable) in the audited consolidated financial statements for such
five fiscal years which were included or incorporated by reference in
the Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing
came to their attention as a result of the foregoing procedures that
caused them to believe that this information does not conform in all
material
respects with the disclosure requirements of items 301, 302, 402 and
503(d), respectively, of Regulation
S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, inquiries of officials of
the Company and its subsidiaries responsible for financial and
accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused
them to believe that:
(A) (i) the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus and/or included or incorporated by reference in the
Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and
regulations, or (ii) any material modifications should be made
to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash
flows included in the Prospectus or included in the Company's
Quarterly Reports on Form 10-Q incorporated by reference in the
Prospectus, for them to be in conformity with generally
accepted accounting principles;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not agree
with the corresponding items in the unaudited consolidated
financial statements from which such data and items were
derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis
for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in
the Company's Annual Report on Form 10-K for the most recent
fiscal year;
(C) the unaudited financial statements which were
not included in the Prospectus but from which were derived the
unaudited condensed financial statements referred to in clause
(A) and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in Clause (B)
were not determined on a basis substantially consistent with
the basis for the audited financial statements included or
incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated
condensed financial statements included or incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Act and the published rules and regulations thereunder
or the pro forma adjustments have not been properly applied to
the historical amounts in the compilation of those statements;
(E) as of a specified date not more than five
days prior to the date of such letter, there have been any
changes in the consolidated capital stock (other than issuances
of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and
upon conversions of convertible securities, in each case which
were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and
its subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in
the latest balance sheet included or incorporated by reference
in the Prospectus, except
-2-
in each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are
described in such letter; and
(F) for the period from the date of the latest
financial statements included or incorporated by reference in
the Prospectus to the specified date referred to in Clause (E)
there were any decreases in consolidated net revenues or
operating profit or the total or per share amounts of
consolidated net income or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable
period of the preceding year and with any other period of
corresponding length specified by the Representatives, except
in each case for increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; and
(vii) In addition to the examination referred to in
their report(s) included or incorporated by reference in the Prospectus
and the limited procedures, inspection of minute books, inquiries and
other procedures referred to in paragraphs (iii) and (vi) above, they
have carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing standards,
with respect to certain amounts, percentages and financial information
specified by the Representatives which are derived from the general
accounting records of the Company and its subsidiaries, which appear in
the Prospectus (excluding documents incorporated by reference), or in
Part II of, or in exhibits and schedules to, the Registration Statement
specified by the Representatives or in documents incorporated by
reference in the Prospectus specified by the Representatives, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and
have found them to be in agreement.
All references in this Annex II to the Prospectus shall be
deemed to refer to the Prospectus (including the documents incorporated by
reference therein) as defined in the Underwriting Agreement as of the date of
the letter delivered on the date of the Pricing Agreement for purposes of such
letter and to the Prospectus as amended or supplemented (including the documents
incorporated by reference therein) in relation to the applicable Designated
Shares for purposes of the letter delivered at the Time of Delivery for such
Designated Shares.
-3-