<PAGE>
PRICING AGREEMENT
Goldman, Sachs & Co.
Salomon Smith Barney Inc.,
As Representatives of the several
Underwriters named in Schedule I hereto
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
September 28, 2000
Ladies and Gentlemen:
USA Education, Inc., a Delaware corporation (the "COMPANY"), proposes,
subject to the terms and conditions stated herein and in the Underwriting
Agreement, dated as of September 28, 2000 (the "UNDERWRITING AGREEMENT"),
between the Company on the one hand and Goldman, Sachs & Co. and Salomon Smith
Barney Inc. on the other hand, to issue and sell to the Underwriters named in
Schedule I hereto (the "UNDERWRITERS") the Securities specified in Schedule II
hereto (the "DESIGNATED SECURITIES"). 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
Securities 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
Securities pursuant to Section 12 of the Underwriting Agreement and the address
of the Representatives referred to in such Section 12 are set forth at the end
of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, 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 principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us one for the Company and 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.
<PAGE>
Very truly yours,
USA EDUCATION, INC.
By: /s/ John F. Remondi
----------------------------------------
Name: John F. Remondi
Title: Senior Vice President & Treasurer
Accepted as of the date hereof:
GOLDMAN, SACHS & CO.
By: /s/ Goldman, Sachs & Co.
-------------------------------
On behalf of each of the Underwriters
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
DESIGNATED
SECURITIES
TO BE
UNDERWRITER PURCHASED
----------- ---------
<S> <C>
Goldman, Sachs & Co. ....................................... $ 220,000,000
Salomon Smith Barney Inc. .................................. $ 220,000,000
Banc of America Securities LLC ............................. $ 15,000,000
Banc One Capital Markets, Inc. ............................. $ 15,000,000
Credit Suisse First Boston Corporation ..................... $ 15,000,000
First Union National Bank .................................. $ 15,000,000
--------------
Total ............................................... $ 500,000,000
==============
</TABLE>
<PAGE>
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
Senior Notes due September 16, 2002
AGGREGATE PRINCIPAL AMOUNT:
$ 500,000,000
PRICE TO PUBLIC:
100 % of the principal amount of the Designated Securities
PURCHASE PRICE BY UNDERWRITERS:
99.750 % of the principal amount of the Designated Securities
FORM OF DESIGNATED SECURITIES:
Book-entry only form represented by two 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.
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Federal (same day) funds
TIME OF DELIVERY:
11:00 a.m. (New York City time), October 3, 2000
INDENTURE:
Indenture, dated as of October 1, 2000, between USA Education, Inc. and
The Chase Manhattan Bank, as trustee, and Supplemental Indenture, dated
October 3, 2000, between USA Education, Inc. and The Chase Manhattan
Bank, as trustee
MATURITY:
September 16, 2002
INTEREST RATE:
Three-month LIBOR, as determined on the second business day before the
applicable accrual period, plus 0.22%.
Interest will accrue from the date of original issuance, October 3,
2000.
INTEREST PAYMENT DATES:
Quarterly on March 16, June 16, September 16 and December 16 of each
year, except that first payment of interest will be made on January 3,
2001.
REDEMPTION PROVISIONS:
No provisions for redemption.
SINKING FUND PROVISIONS:
No sinking fund provisions.
<PAGE>
FLOATING RATE PROVISIONS:
Annual interest rate will be 0.22% over three-month LIBOR, as determined
on the second business day before the applicable accrual period.
DEFEASANCE PROVISIONS:
No defeasance provisions.
CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
Offices of USA Education, Inc.
11600 Sallie Mae Drive
Reston, Virginia 20193
ADDITIONAL CLOSING CONDITIONS:
None.
NAMES AND ADDRESSES OF REPRESENTATIVES:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Salomon Smith Barney Inc.
388 Greenwich Street
34th Floor
New York, New York 10013
Goldman, Sachs & Co. shall be entitled to execute documents and
instruments on behalf of the Representatives and the Underwriters
OTHER TERMS:
The representation set forth in Section 2(d) of the Underwriting
Agreement is modified to read as follows:
(d) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus; and, since the respective dates
as of which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries (except for the
transactions relating to the acquisition of USA Group, described in the
Prospectus under "Recent Developments") or any material adverse change,
or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus.
