<PAGE>
Letter of Transmittal
To Tender Shares of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
Sylvan Learning Systems, Inc.
Pursuant to the Offer to Purchase
Dated August 10, 2000
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THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, EASTERN TIME, ON THURSDAY, SEPTEMBER 7, 2000, UNLESS THE OFFER IS
EXTENDED.
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The Depositary for the offer is:
First Union National Bank
By Mail: By Overnight Delivery: By Hand Delivery:
First Union National First Union National Bank First Union National
Bank 1525 West W.T. Harris Blvd Bank
1525 West W.T. Harris Charlotte, NC 28262-1153 1525 West W.T. Harris
Blvd Blvd
Charlotte, NC 28288- Attn: Reorg Dept. Building 3C3
1153 Charlotte, NC 28262
Attn: Reorg Dept.
Attn: Reorg Dept.
This Letter of Transmittal, including the accompanying instructions, should
be read carefully before this Letter of Transmittal is completed.
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DESCRIPTION OF SHARES TENDERED
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<TABLE>
<CAPTION>
Name(s) and Address(es) of Registered Owner(s)
(Please fill in, if blank, exactly as name(s) Certificate(s) Enclosed
appear(s) on Share Certificate(s)) (attach signed list if necessary)
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Total
Number of
Shares
Share Evidenced by Number
Certificate Share of Shares
Number(s)* Certificate(s) Tendered**
-----------------------------------------------
<S> <C> <C> <C>
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
(Attach additional signed list if
necessary. See Instruction 9.)
Total Shares
</TABLE>
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Indicate in this box the order (by certificate number) in which shares are to
be purchased in the event of proration.***
Attach additional signed list if necessary. See Instruction 9.
1st: 2nd: 3rd: 4th: 5th:
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[_] Check here if you are tendering pursuant to lost, stolen, destroyed or
mutilated certificates. See affidavit on page 6, replacement insurance
premium calculation on page 8 and Instruction 15.
* DOES NOT need to be completed by shareholders tendering shares by book-
entry transfer.
** Unless otherwise indicated, it will be assumed that all shares evidenced
by each certificate delivered to the Depositary are being tendered hereby.
See Instruction 4.
*** If you do not designate an order, in the event less than all shares
tendered are purchased due to proration, shares will be selected for
purchase by the Depositary.
Delivery of this Letter of Transmittal to an address other than as set
forth above will not constitute a valid delivery. Deliveries to Sylvan will
not be forwarded to the Depositary and therefore will not constitute valid
delivery. Deliveries to the Book-Entry Transfer Facility will not constitute
valid delivery to the Depositary. Deliveries of this Letter of Transmittal for
shares held in Sylvan's 401(k) Retirement Savings Plan or Sylvan's Employee
Stock Purchase Plan will not constitute valid direction to the trustee of
either of these plans to tender shares.
1
<PAGE>
This Letter of Transmittal is to be completed only if (a) certificates
representing shares are to be forwarded herewith, or (b) unless an Agent's
Message (as defined in the Offer to Purchase) is used or the acknowledgement
required by the Automated Tender Offer Program is provided, a tender of shares
is to be made concurrently by book-entry transfer to the account maintained by
the Depositary at The Depositary Trust Company (the "Book-Entry Transfer
Facility") pursuant to Section 3 of the Offer to Purchase. Shareholders who
desire to tender shares pursuant to the offer, but whose share certificates are
not immediately available or who cannot deliver the certificates and all other
documents required by this Letter of Transmittal to the Depositary on or before
the Expiration Date (as defined in the Offer to Purchase), or who cannot comply
with the procedure for book-entry transfer on a timely basis, may nevertheless
tender their shares pursuant to the guaranteed delivery procedure set forth in
Section 3 of the Offer to Purchase. See Instruction 2.
This Letter of Transmittal may not be used for shares held in Sylvan's
Employee Stock Purchase Plan. See Instruction 17. Participants in the Employee
Stock Purchase Plan must follow the instructions in the "Letter to Participants
in Sylvan's Employee Stock Purchase Plan" and related materials sent to them
separately.
If participants in Sylvan's Employee Stock Purchase Plan own shares apart
from the Employee Stock Purchase Plan that they desire to tender, such holders
must both submit this Letter of Transmittal to tender the non-employee stock
purchase plan shares, and follow the instructions described in the "Letter to
Participants in Sylvan's Employee Stock Purchase Plan" and related materials
sent to them separately to tender shares held in their account under the
Employee Stock Purchase Plan.
This Letter of Transmittal may not be used for shares held in Sylvan's
401(k) Retirement Savings Plan. See Instruction 18. Participants in the savings
plan must follow the instructions in the "Letter to Participants in Sylvan's
401(k) Retirement Savings Plan" and related materials sent to them separately.
Putnam Fiduciary Trust Company, the trustee for Sylvan's 401(k) Retirement
Savings Plan and holder of record, will submit one Letter of Transmittal for
the savings plan on behalf of all of the tendering participants in Sylvan's
401(k) Retirement Savings Plan.
If participants in Sylvan's 401(k) Retirement Savings Plan own shares apart
from the savings plan that they desire to tender, such holders must both submit
this Letter of Transmittal to tender the non-savings plan shares, and follow
the instructions described in the "Letter to Participants in Sylvan's 401(k)
Retirement Savings Plan" and related materials sent to them separately to
tender shares allocated to their savings plan account.
2
<PAGE>
Check only one box. If more than one box is checked or if no box is checked,
the shares will not be properly tendered.
Shares Tendered at Price Determined by Shareholder
(See Instruction 5)
By checking one of the following boxes below instead of the box under
"Shares Tendered at a Price Determined Pursuant to the Offer," the
undersigned hereby tenders shares at the price checked. This action could
result in none of the shares being purchased if the purchase price
determined by Sylvan for the shares is less than the price checked below. A
shareholder who desires to tender shares at more than one price must
complete a separate Letter of Transmittal for each price at which shares
are tendered. The same shares cannot be tendered at more than one price.
Price (In Dollars) per Share at Which Shares Are Being Tendered
[_] $13.500 [_] $14.000 [_] $14.500
[_] $13.625 [_] $14.125 [_] $14.625
[_] $13.750 [_] $14.250 [_] $14.750
[_] $13.875 [_] $14.375 [_] $14.875
[_] $15.000
OR
Shares Tendered at Price Determined Pursuant to the Offer
(See Instruction 5)
[_]The undersigned wants to maximize the chance of having Sylvan purchase
all of the shares the undersigned is tendering (subject to the
possibility of proration). Accordingly, by checking this one box instead
of one of the price boxes above, the undersigned hereby tenders shares
and is willing to accept the purchase price determined by Sylvan in
accordance with the terms of the offer. This action could result in
receiving a price per share of as low as $13.50.
3
<PAGE>
Odd Lots
(See Instruction 8)
To be completed only if shares are being tendered by or on behalf of a
person owning, beneficially or of record, an aggregate of fewer than 100
shares (not including any shares held in Sylvan's Employee Stock Purchase Plan
or in Sylvan's 401(k) Retirement Savings Plan). The undersigned either (check
one box):
[_]is the beneficial or record owner of an aggregate of fewer than 100 shares,
all of which are being tendered; or
[_]is a broker, dealer, commercial bank, trust company, or other nominee that
(a) is tendering for the beneficial owner(s), shares with respect to which
it is the record holder, and (b) believes, based upon representations made
to it by the beneficial owner(s), that each such person is the beneficial
owner of an aggregate of fewer than 100 shares and is tendering all of the
shares.
In addition, the undersigned is tendering shares either (check one box):
[_]at the purchase price, as the same will be determined by Sylvan in
accordance with the terms of the offer (persons checking this box need not
indicate the price per share above); or
[_]at the price per share indicated above in the section captioned "Price (In
Dollars) per Share at Which Shares Are Being Tendered."
Conditional Tender (See Instruction 16)
A tendering shareholder may condition his or her tender of shares upon
Sylvan purchasing a specified minimum number of the shares tendered, all as
described in Section 6 of the Offer to Purchase. Unless at least that minimum
number of shares you indicate below is purchased by Sylvan pursuant to the
terms of the offer, none of the shares tendered will be purchased. It is the
tendering shareholder's responsibility to calculate that minimum number of
shares that must be purchased if any are purchased, and each shareholder is
urged to consult his or her own tax advisor. Unless this box has been checked
and a minimum specified, the tender will be deemed unconditional.
[_]The minimum number of shares that must be purchased, if any are purchased,
is: shares.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, Sylvan may terminate or amend the offer or may postpone
the acceptance for payment of, or the payment for, shares tendered or may
accept for payment fewer than all of the shares tendered. In any event, the
undersigned understands that certificate(s) for any shares not tendered or not
purchased will be returned to the undersigned at the address indicated above,
unless otherwise indicated under the box entitled "Special Payment
Instructions" or the box entitled "Special Delivery Instructions" below.
The undersigned understands that acceptance of shares by Sylvan for payment
will constitute a binding agreement between the undersigned and Sylvan upon the
terms and subject to the conditions of the offer.
The check for the aggregate net purchase price for the shares tendered and
purchased will be issued to the order of the undersigned and mailed to the
address indicated above, unless otherwise indicated under the box entitled
"Special Payment Instructions" or the box entitled "Special Delivery
Instructions" below. The undersigned acknowledges that Sylvan has no
obligation, pursuant to the "Special Payment Instructions," to transfer any
shares from the name of its registered holder(s), or to order the registration
or transfer of any shares tendered by book-entry transfer, if Sylvan does not
purchase any of the shares.
4
<PAGE>
SPECIAL PAYMENT INSTRUCTIONS (See SPECIAL DELIVERY INSTRUCTIONS
Instructions 1, 6, 7 and 10) (See Instructions 1, 6, 7 and 10)
To be completed only if certifi- To be completed only if certifi-
cate(s) for shares not tendered cate(s) for shares not tendered
or not purchased and/or any check or not purchased and/or any check
for the purchase price are to be for the purchase price is to be
issued in the name of someone mailed or sent to someone other
other than the undersigned, or if than the undersigned, or to the
shares tendered hereby and deliv- undersigned at an address other
ered by book-entry transfer which than that designated above.
are not purchased are to be re-
turned by credit to an account at Mail:[_] Check
the Book-Entry Transfer Facility [_] Share Certificate(s) to:
other than that designated above.
Name: ____________________________
Issue:[_] Check (Please Print)
[_] Share Certificate(s) to:
Address :_________________________
Name: ____________________________
(Please Print) __________________________________
(Include Zip Code)
Address: _________________________
__________________________________
(Include Zip Code)
__________________________________
(Tax Identification or Social
Security Number)
(See Substitute Form W-9)
[_]Credit shares delivered by
book-entry transfer and not
purchased to the account set
forth below:
Account Number: __________________
5
<PAGE>
[_]Check here if any certificate representing shares tendered hereby has been
lost, stolen, destroyed or mutilated and completely fill in the following
information. If you have lost certificates valued at $100,000 or more, or if
these certificates are part of an estate or trust, please call First Union
National Bank at (800) 829-8432 for additional instructions. Complete this
form only if you cannot locate some or all of your Sylvan common stock
certificate(s). Please print clearly.
Affidavit of Lost or Destroyed Certificate(s)
This affidavit can only be used until the Expiration Date. After the
Expiration Date please call First Union National Bank at (800) 829-8432.
Affidavit of Lost or Destroyed Certificate(s)
STATE OF
ss.
COUNTY OF
The undersigned (hereinafter called "Deponent"), being duly sworn, deposes
and says that:
(1) Deponent is an adult whose mailing address is:
--------------------------------------------------------------------------------
and is the owner of or is acting in a representative or fiduciary capacity with
respect to certain securities (describe type of security, identification number
and number of shares or face value):
Certificate No(s):
issued by Sylvan Learning Systems, Inc. and registered in the name of: _________
(2) Deponent further says that the aforesaid security or securities
(hereinafter called the "Original," whether one or more) have been lost,
stolen, destroyed or misplaced under the following circumstances: ______________
--------------------------------------------------------------------------------
(3) That said Original (was) (was not) endorsed. (If endorsed, describe form
of endorsement and state whether signature was guaranteed.)
(4) Deponent has made or caused to be made diligent search for Original, and
has been unable to find or recover same, and that Deponent was the
unconditional owner of Original at the time of loss, and is entitled to the
full and exclusive possession thereof; that neither the Original nor the rights
of Deponent therein have, in whole or in part, been assigned, transferred,
hypothecated, pledged or otherwise disposed of, in any manner whatsoever, and
that no person, firm or corporation other than Deponent has any right, title,
claim, equity or interest in, to, or respecting Original or the proceeds
thereof, except as may be set forth in Statement (5) following.
(5) (If Deponent's interest in the Original is in a representative or
fiduciary capacity, indicate below the designation of such capacity, i.e.,
Administrator, Executor, etc. and the title of the estate, as follows):
Deponent is of the estate of ;
(Specify names of any other persons having an interest in the Original. List
them below and indicate the nature of their interest, such as heir, legatee,
etc.)
<TABLE>
<CAPTION>
Name Interest
---- --------
<S> <C>
</TABLE>
6
<PAGE>
(6) Deponent makes this affidavit for the purpose of requesting and inducing
Sylvan and its agents to issue new securities in substitution for the Original
and Seaboard Surety Company to assume liability in respect thereof under its
Indemnity Bond.
(7) Deponent agrees that if said Original should ever come into Deponent's
hands, custody or power, Deponent will immediately and without consideration
surrender Original to Sylvan, its transfer agents, subscription agents,
trustees or Seaboard Surety Company for cancellation.
(8) Signed, sealed and dated: , 2000
Signature of Deponent
Signature of Deponent
Sworn to and subscribed before me Sworn to and subscribed before me
this day of , 2000. this day of , 2000.
NOTARY PUBLIC
NOTARY PUBLIC
(Affix Notarial Seal)
(Affix Notarial Seal)
My Commission expires: My Commission expires:
7
<PAGE>
See below terms and conditions
for shareowner lost certificate replacements under $100,000
Replacement Insurance Premium Calculation for lost common stock certificates.
___________________ X $0.29 = _____________________
Shares Lost Insurance Premium Per Total Premium Due*
Share
* The minimum premium due is $25.00
Please make your check payable to Seaboard Surety Company and enclose it
with this Letter of Transmittal.
Terms and conditions for shareholder lost certificate replacements under
$100,000
By signing this Letter of Transmittal, I certify that I am the lawful owner
of the shares described on the front of this form, that these shares have not
been pledged or endorsed and that no other person, firm, corporation, agency
or government has asserted any right or title, claim equity or interest in
this (these) certificate(s). I have made a diligent search for the
certificate(s), and I have been unable to find it (them). I hereby agree (for
myself, my heirs, assigns and personal representatives), in consideration of
the exchange of the shares represented by certificate(s), to completely
indemnify, protect and hold harmless Seaboard Surety Company, Sylvan Learning
Systems, Inc., First Union National Bank, and their respective affiliates
collectively, from and against any and all losses, costs and damages which
they may be subject to, or liable for, as a result of the action taken in
honoring the affidavit provided. I agree that this form is attached to and
made part of a blanket bond underwritten by Seaboard Surety Company to protect
the foregoing, Sylvan and First Union National Bank. I agree to surrender the
certificate(s) for its (their) cancellation if I find it (them) at any time.
[_]Check here if tendered shares are being delivered by book-entry transfer to
an account maintained by the Depositary at the Book-Entry Transfer Facility
and complete the following:
Name of Tendering Institution: _______________________________________________
Account No.: _________________________________________________________________
Transaction Code No.: ________________________________________________________
[_]Check here if shares are being tendered pursuant to a notice of guaranteed
delivery previously sent to the Depositary and complete the following:
Name(s) of Registered Holder(s): _____________________________________________
Date of execution of Notice of Guaranteed Delivery: , 2000
Name of Institution that Guaranteed Delivery: ________________________________
Window Ticket Number (if any): _______________________________________________
8
<PAGE>
Note: Signatures must be provided below.
Please read the accompanying instructions carefully
To First Union National Bank:
The undersigned hereby tenders to Sylvan Learning Systems, Inc., a Maryland
corporation, the above-described shares of Sylvan's common stock, $0.01 par
value per share, at the price per share indicated in this Letter of
Transmittal, net to the seller in cash, without interest, upon the terms and
subject to the conditions set forth in the Offer to Purchase dated August 10,
2000, receipt of which is hereby acknowledged, and in this Letter of
Transmittal which, as amended or supplemented from time to time, together
constitute the offer. All shares tendered and purchased will include the
associated preferred stock purchase rights issued pursuant to the Amended and
Restated Rights Agreement dated as of December 18, 1999 between Sylvan and
First Union National Bank, as rights agent, and, unless the context otherwise
requires, all references to shares include the associated preferred stock
purchase rights.
Subject to, and effective upon, acceptance for payment of the shares
tendered in accordance with the terms and subject to the conditions of the
offer, including, if the offer is extended or amended, the terms and conditions
of the extension or amendment, the undersigned agrees to sell, assign and
transfer to, or upon the order of, Sylvan all right, title and interest in and
to all shares tendered and orders the registration of all shares if tendered by
book-entry transfer and irrevocably constitute and appoint the Depositary as
the true and lawful agent and attorney-in-fact of the undersigned with respect
to the shares with full knowledge that the Depositary also acts as the agent of
Sylvan, with full power of substitution (the power of attorney being deemed to
be an irrevocable power coupled with an interest), to:
(a) deliver certificate(s) representing the shares or transfer ownership
of the shares on the account books maintained by the Book-Entry Transfer
Facility, together, in either case, with all accompanying evidences of
transfer and authenticity, to or upon the order of Sylvan upon receipt by
the Depositary, as the undersigned's agent, of the purchase price with
respect to the shares;
(b) present certificates for the shares for cancellation and transfer on
Sylvan's books; and
(c) receive all benefits and otherwise exercise all rights of beneficial
ownership of the shares, subject to the next paragraph, all in accordance
with the terms and subject to the conditions of the offer.
The undersigned covenants, represents and warrants to Sylvan that:
(1) the undersigned has full power and authority to tender, sell, assign
and transfer the shares (including the associated preferred stock purchase
rights) tendered hereby and when and to the extent accepted for payment,
Sylvan will acquire good, marketable and unencumbered title to the tendered
shares (including the associated preferred stock purchase rights), free and
clear of all security interests, liens, restrictions, charges,
encumbrances, conditional sales agreements or other obligations relating to
the sale or transfer of the shares, and not subject to any adverse claims;
(2) the undersigned understands that tenders of shares pursuant to any
one of the procedures described in Section 3 of the Offer to Purchase and
in the instructions will constitute the undersigned's acceptance of the
terms and conditions of the offer, including the undersigned's
representation and warranty that (i) the undersigned has a "net long
position," within the meaning of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, in the shares or equivalent securities at
least equal to the shares being tendered, and (ii) the tender of shares
complies with Rule 14e-4;
(3) the undersigned will, upon request, execute and deliver any
additional documents deemed by the Depositary or Sylvan to be necessary or
desirable to complete the sale, assignment and transfer of the shares
tendered; and
(4) the undersigned has read, understands and agrees to all of the terms
of the offer.
9
<PAGE>
The undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions will constitute a binding agreement between the undersigned and
Sylvan upon the terms and subject to the conditions of the offer. The
undersigned acknowledges that under no circumstances will Sylvan pay interest
on the purchase price, including without limitation, by reason of any delay in
making payment.
All authority conferred or agreed to be conferred will survive the death or
incapacity of the undersigned, and any obligation of the undersigned will be
binding on the heirs, personal representatives, executors, administrators,
successors, assigns, trustees in bankruptcy and legal representatives of the
undersigned. Except as stated in the Offer to Purchase, this tender is
irrevocable.
The name(s) and address(es) of the registered holder(s) should be printed,
if they are not already printed above, exactly as they appear on the
certificates representing shares tendered. The certificate numbers, the number
of shares represented by the certificates and the number of shares that the
undersigned wishes to tender, should be set forth in the appropriate boxes
above. The price at which the shares are being tendered should be indicated in
the box above.
The undersigned understands that Sylvan will determine a single per share
price, not greater than $15.00 nor less than $13.50, that it will pay for
shares properly tendered, taking into account the number of shares tendered and
the prices specified by tendering shareholders. Sylvan will select the lowest
purchase price that will allow it to buy 6,000,000 shares or, if a lesser
number of shares are properly tendered, all shares that are properly tendered
and not withdrawn. All shares acquired in the offer will be acquired at the
same purchase price. All shares properly tendered at prices at or below the
purchase price and not properly withdrawn will be purchased, subject to the
conditions of the offer and the "odd lot" priority, proration and conditional
tender provisions described in the Offer to Purchase. Shares tendered at prices
in excess of the purchase price that is determined by Sylvan and shares not
purchased because of proration or conditional tenders will be returned.
10
<PAGE>
IMPORTANT
SHAREHOLDERS SIGN HERE
(Please Complete and Return the Attached Substitute Form W-9.)
(Must be signed by the registered holder(s) exactly as such holder(s)
name(s) appear(s) on certificate(s) for shares or on a security position
listing or by person(s) authorized to become the registered holder(s) thereof
by certificates and documents transmitted with this Letter of Transmittal. If
signature is by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or
representative capacity, please set forth full title and see Instruction 6.)
--------------------------------------------------------------------
--------------------------------------------------------------------
(Signature(s) of Owner(s))
Dated: ________________________________________________________, 2000
Name(s): ___________________________________________________________
------------------------------------------------------------------------
(Please Print)
Capacity (full title): _____________________________________________
Address: ___________________________________________________________
------------------------------------------------------------------------
(Include Zip Code)
Daytime Area Code and Telephone Number: ____________________________
Tax Identification or
Social Security Number: ____________________________________________
(SEE SUBSTITUTE FORM W-9)
Guarantee of Signature(s)
(See Instructions 1 and 6)
Authorized Signature: ______________________________________________
Name: ______________________________________________________________
(Please Print)
Title: _____________________________________________________________
Name of Firm: ______________________________________________________
Address: ___________________________________________________________
(Include Zip Code)
Area Code and Telephone Number: ____________________________________
Dated: ________________________________________________________, 2000
11
<PAGE>
PAYER: FIRST UNION NATIONAL BANK
Part I--TAXPAYER
IDENTIFICATION NUMBER-FOR ----------------------
SUBSTITUTE ALL ACCOUNTS, ENTER Social security number
Form W-9 TAXPAYER IDENTIFICATION OR
NUMBER IN THE BOX AT RIGHT ----------------------
Department of AND CERTIFY BY SIGNING AND Employer identification
the Treasury DATING BELOW. number
Internal Part II--For payees exempt from backup withholding,
Revenue please write "EXEMPT" here (see the enclosed
Service Guidelines):
Note: If the account is in
more than one name, see the
chart in the enclosed
Guidelines to determine
which number to give the
payer.
--------------------------------------------------------
-----------------------------------------------------
--------------------------------------------------------
Payer's Request for Part III--Certification--UNDER PENALTIES OF PERJURY,
Taxpayer I CERTIFY THAT
Identification (1) The number shown on this form is my correct
Number (TIN) Taxpayer Identification Number (or I am waiting
for a number to be issued to me), and
(2) I am not subject to backup withholding because
(a) I am exempt from backup withholding, (b) I
have not been notified by the Internal Revenue
Service ("IRS") that I am subject to backup
withholding as a result of a failure to report
all interest or dividends, or (c) the IRS has
notified me that I am no longer subject to backup
withholding.
--------------------------------------------------------
Certification Instructions--You must cross out item
(2) above if you have been notified by the IRS that
you are currently subject to backup withholding be-
cause of underreporting interest or dividends on your
tax return and you have not been notified by the IRS
that you are no longer subject to backup withholding.
(Also, see instructions in the enclosed Guidelines.)
Signature: ___________________________________________
Date: _______, 2000
NOTE: Failure to complete and return this form may result in backup
withholding of 31% of any payments made to you pursuant to the offer.
Please review the enclosed guidelines for certification of taxpayer
identification number on Substitute Form W-9 for additional details. You
must complete the following certificate if you are awaiting (or will soon
apply for) a taxpayer identification number.
Certificate of Awaiting Taxpayer Identification Number
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and that I mailed or delivered an application to
receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office (or I intend to mail
or deliver an application in the near future). I understand that,
notwithstanding the information I provided in Part III of the Substitute Form
W-9 above (and the fact that I have completed this Certificate of Awaiting
Taxpayer Identification Number), if I do not provide a taxpayer
identification number to the Depositary within sixty (60) days, the
Depositary is required to withhold 31% of all cash payments made to me
thereafter until I provide a number.
Signature ____________________________ Date: _____________, 2000
Name (Please Print) ______________________________________________________
Address (Please Print) ___________________________________________________
12
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer.
1. Guarantee of Signatures. No signature guarantee is required if either:
(a) this Letter of Transmittal is signed by the registered holder of the
shares (which term, for these purposes, includes any participant in the
Book-Entry Transfer Facility whose name appears on a security position
listing as the owner of the shares) tendered exactly as the name of the
registered holder appears on the certificate(s) for the shares tendered
with this Letter of Transmittal and payment and delivery are to be made
directly to the owner unless the owner has completed either the box
entitled "Special Payment Instructions" or "Special Delivery Instructions"
above; or
(b) the shares are tendered for the account of a bank, broker, dealer,
credit union, savings association or other entity which is a member in good
standing of the Securities Transfer Agents Medallion Program or a bank,
broker, dealer, credit union, savings association or other entity which is
an "eligible guarantor institution," as that term is defined in Rule 17Ad-
15 promulgated under the Securities Exchange Act of 1934, as amended (each
of the foregoing constituting an "Eligible Institution").
In all other cases, an Eligible Institution must guarantee all signatures on
this Letter of Transmittal. See Instruction 6.
2. Delivery of Letter of Transmittal and Certificates; Guaranteed Delivery
Procedures. This Letter of Transmittal is to be completed only if certificates
for shares are delivered with it to the Depositary (or the certificates will be
delivered pursuant to a Notice of Guaranteed Delivery previously sent to the
Depositary) or if a tender for shares is being made concurrently pursuant to
the procedure for tender by book-entry transfer set forth in Section 3 of the
Offer to Purchase. Certificates for all physically tendered shares must be
delivered or mailed or confirmation of a book-entry transfer into the
Depositary's account at the Book-Entry Transfer Facility of shares tendered
electronically must be received or a valid tender through the Book-Entry
Transfer Facility's Automated Tender Offer Program must be made, and in each
case a properly completed and duly executed Letter of Transmittal (or manually
signed facsimile of the Letter of Transmittal), including any required
signature guarantees, an Agent's Message in the case of a book-entry transfer
or the specific acknowledgement in the case of a tender through the Automated
Tender Offer Program of the Book-Entry Transfer Facility, and any other
documents required by this Letter of Transmittal, should be mailed or delivered
to the Depositary at the appropriate address set forth in this document and
must be delivered to the Depositary on or before the Expiration Date. Delivery
of documents to the Book-Entry Transfer Facility does not constitute delivery
to the Depositary.
Participants in the Book-Entry Transfer Facility may tender their shares in
accordance with the Automated Tender Offer Program to the extent it is
available to such participants for the shares they wish to tender. A
shareholder tendering through the Automated Tender Offer Program must expressly
acknowledge that the shareholder has received and agreed to be bound by the
Letter of Transmittal and that the Letter of Transmittal may be enforced
against such shareholder.
Shareholders whose certificates are not immediately available or who cannot
deliver certificates for their shares and all other required documents to the
Depositary before the Expiration Date, or whose shares cannot be delivered on a
timely basis pursuant to the procedures for book-entry transfer, must, in any
case, tender their shares by or through any Eligible Institution by properly
completing and duly executing and delivering a Notice of Guaranteed Delivery
(or facsimile of the Notice of Guaranteed Delivery) and by otherwise complying
with the guaranteed delivery procedure set forth in Section 3 of the Offer to
Purchase. Pursuant to that procedure, certificates for all physically tendered
shares or book-entry confirmations, as the case may be, as well as this
properly completed and duly executed Letter of Transmittal (or manually signed
facsimile of this Letter of Transmittal), an Agent's Message in the case of a
book-entry transfer or the specific acknowledgement in the
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case of a tender through the Automated Tender Offer Program of the Book-Entry
Transfer Facility, and all other documents required by this Letter of
Transmittal, must be received by the Depositary within three (3) Nasdaq Stock
Market trading days after receipt by the Depositary of the Notice of Guaranteed
Delivery, all as provided in Section 3 of the Offer to Purchase.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
telegram, facsimile transmission or mail to the Depositary and must include a
guarantee by an Eligible Institution in the form set forth therein. For shares
to be tendered validly pursuant to the guaranteed delivery procedure, the
Depositary must receive the Notice of Guaranteed Delivery on or before the
Expiration Date.
The method of delivery of all documents, including certificates for shares,
the Letter of Transmittal and any other required documents, is at the election
and risk of the tendering shareholder. If delivery is by mail, Sylvan
recommends that you use registered mail with return receipt requested, properly
insured. In all cases, sufficient time should be allowed to ensure timely
delivery.
Except as specifically permitted by Section 6 of the Offer to Purchase,
Sylvan will not accept any alternative, conditional or contingent tenders, nor
will it purchase any fractional shares, except as expressly provided in the
Offer to Purchase. All tendering shareholders, by execution of this Letter of
Transmittal (or a facsimile of this Letter of Transmittal), waive any right to
receive any notice of the acceptance of their tender.
3. Inadequate Space. If the space provided in the box entitled "Description
of Shares Tendered" above is inadequate, the certificate numbers and/or the
number of shares should be listed on a separate signed schedule and attached to
this Letter of Transmittal.
4. Partial Tenders and Unpurchased Shares. (Not applicable to shareholders
who tender by book-entry transfer.) If fewer than all of the shares evidenced
by any certificate are to be tendered, fill in the number of shares that are to
be tendered in the column entitled "Number of Shares Tendered" in the box
entitled "Description of Shares Tendered" above. In that case, if any tendered
shares are purchased, a new certificate for the remainder of the shares
(including any shares not purchased) evidenced by the old certificate(s) will
be issued and sent to the registered holder(s), unless otherwise specified in
either the box entitled "Special Payment Instructions" or the box entitled
"Special Delivery Instructions" in this Letter of Transmittal, as soon as
practicable after the Expiration Date. Unless otherwise indicated, all shares
represented by the certificate(s) set forth above and delivered to the
Depositary will be deemed to have been tendered.
5. Indication of Price at Which Shares are Being Tendered. For shares to be
properly tendered, the shareholder must either (1) check the box next to the
section captioned "Shares Tendered at Price Determined Pursuant to the Offer"
in this Letter of Transmittal or (2) check one of the boxes in the section
captioned "Price (In Dollars) per Share at Which Shares Are Being Tendered" in
this Letter of Transmittal indicating the price at which the shareholder is
tendering shares. Only one box may be checked. If more than one box is checked
or if no box is checked, the shares will not be properly tendered. A
shareholder wishing to tender portions of the holder's shares at different
prices must complete a separate Letter of Transmittal for each price at which
the holder wishes to tender each portion of the holder's shares. The same
shares cannot be tendered (unless previously and properly withdrawn as provided
in Section 4 of the Offer to Purchase) at more than one price.
6. Signatures on Letter Of Transmittal; Stock Powers and Endorsements.
(a) If this Letter of Transmittal is signed by the registered holder(s)
of the shares tendered, the signature(s) must correspond exactly with the
name(s) as written on the face of the certificate(s) without any change
whatsoever.
(b) If the shares tendered are registered in the names of two or more
joint holders, each holder must sign this Letter of Transmittal.
(c) If any tendered shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal (or facsimile) as there are different
registrations of certificates.
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(d) When this Letter of Transmittal is signed by the registered
holder(s) of the shares tendered, no endorsement(s) of certificate(s)
representing the shares or separate stock power(s) are required unless
payment is to be made or the certificate(s) for shares not tendered or not
purchased are to be issued to a person other than the registered holder(s).
Signature(s) on the certificate(s) must be guaranteed by an Eligible
Institution. If this Letter of Transmittal is signed by a person other than
the registered holder(s) of the certificate(s) listed, or if payment is to
be made or certificate(s) for shares not tendered or not purchased are to
be issued to a person other than the registered holder(s), the
certificate(s) must be endorsed or accompanied by appropriate stock
power(s), in either case signed exactly as the name(s) of the registered
holder(s) appears on the certificate(s), and the signature(s) on the
certificate(s) or stock power(s) must be guaranteed by an Eligible
Institution. See Instruction 1.
(e) If this Letter of Transmittal or any certificate(s) or stock
power(s) is signed by a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation or any other person acting in a
fiduciary or representative capacity, that person should so indicate when
signing this Letter of Transmittal and must submit proper evidence
satisfactory to Sylvan of his or her authority to so act.
7. Stock Transfer Taxes. Except as provided in this Instruction 7, no stock
transfer tax stamps or funds to cover tax stamps need accompany this Letter of
Transmittal. Sylvan will pay any stock transfer taxes payable on the transfer
to it of shares purchased pursuant to the offer. If, however, either (a)
payment of the purchase price for shares tendered and accepted for purchase is
to be made to any person other than the registered holder(s); (b) shares not
tendered or rejected for purchase are to be registered in the name(s) of any
person(s) other than the registered holder(s); or (c) certificate(s)
representing tendered shares are registered in the name(s) of any person(s)
other than the person(s) signing this Letter of Transmittal, then the
Depositary will deduct from the purchase price the amount of any stock transfer
taxes (whether imposed on the registered holder(s), other person(s) or
otherwise) payable on account of the transfer to that person, unless
satisfactory evidence of the payment of the taxes or any exemption therefrom is
submitted.
8. Odd Lots. As described in Section 1 of the Offer to Purchase, if Sylvan
is to purchase fewer than all shares tendered before the Expiration Date and
not properly withdrawn, the shares purchased first will consist of all shares
properly tendered by any shareholder who owned, beneficially or of record, an
aggregate of fewer than 100 shares (not including any shares held in Sylvan's
Employee Stock Purchase Plan or in Sylvan's 401(k) Retirement Savings Plan),
and who tenders all of the holder's shares at or below the purchase price (an
"Odd Lot Holder"). This preference will not be available unless the section
captioned "Odd Lots" is completed.
9. Order of Purchase in Event of Proration. As described in Section 1 of the
Offer to Purchase, shareholders may designate the order in which their shares
are to be purchased in the event of proration. The order of purchase may have
an effect on the federal income tax treatment of the purchase price for the
shares purchased. See Sections 1 and 14 of the Offer to Purchase.
10. Special Payment and Delivery Instructions. If certificate(s) for shares
not tendered or not purchased and/or check(s) are to be issued in the name of a
person other than the signer of this Letter of Transmittal or if the
certificates and/or checks are to be sent to someone other than the person
signing this Letter of Transmittal or to the signer at a different address, the
box entitled "Special Payment Instructions" and/or the box entitled "Special
Delivery Instructions" on this Letter of Transmittal should be completed as
applicable and signatures must be guaranteed as described in Instruction 1.
11. Irregularities. All questions as to the number of shares to be accepted,
the price to be paid for the shares and the validity, form, eligibility
(including time of receipt) and acceptance for payment of any tender of shares
will be determined by Sylvan in its sole discretion, which determination will
be final and binding on all parties. Sylvan reserves the absolute right to
reject any or all tenders of shares it determines not to be in proper form or
the acceptance of which or payment for which may, in the opinion of Sylvan's
counsel, be unlawful. Sylvan also reserves the absolute right to waive any of
the conditions of the offer or any defect or irregularity in any tender with
respect to any particular shares or any particular shareholder, and Sylvan's
interpretation of
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the terms of the offer (including these Instructions) will be final and binding
on all parties. No tender of shares will be deemed to be properly made until
all defects and irregularities have been cured by the tendering shareholder or
waived by Sylvan. Unless waived, any defects or irregularities in connection
with tenders must be cured within that time as Sylvan will determine. None of
Sylvan, the Dealer Manager (as defined in the Offer to Purchase), the
Depositary, the Information Agent (as defined in the Offer to Purchase) or any
other person is or will be obligated to give notice of any defects or
irregularities in tenders and none of them will incur any liability for failure
to give any notice of defect or irregularity.
12. Questions and Requests for Assistance and Additional Copies. You may
request additional copies of the Offer to Purchase, the Letter of Transmittal
or the Notice of Guaranteed Delivery from the Information Agent at its address
and telephone numbers set forth on the back cover of the Offer to Purchase.
13. Tax Identification Number and Backup Withholding. Federal income tax law
generally requires that a shareholder whose tendered shares are accepted for
purchase, or the shareholder's assignee (in either case, the "Payee"), provide
the Depositary with the Payee's correct Taxpayer Identification Number ("TIN"),
which, in the case of a Payee who is an individual, is the Payee's social
security number. If the Depositary is not provided with the correct TIN or an
adequate basis for an exemption, the Payee may be subject to penalties imposed
by the Internal Revenue Service and backup withholding in an amount equal to
31% of the gross proceeds received pursuant to the offer. If withholding
results in an overpayment of taxes, a refund may be obtained.
To prevent backup withholding, each Payee must provide the Payee's correct
TIN by completing the Substitute Form W-9 set forth in this document,
certifying that the TIN provided is correct (or that the Payee is awaiting a
TIN) and that (i) the Payee is exempt from backup withholding, (ii) the Payee
has not been notified by the Internal Revenue Service that the Payee is subject
to backup withholding as a result of a failure to report all interest or
dividends, or (iii) the Internal Revenue Service has notified the Payee that
the Payee is no longer subject to backup withholding.
If the Payee lacks a TIN, the Payee should (i) consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 ("W-9 Guidelines") for instructions on applying for a TIN, (ii) write
"Applied For" in the space provided in Part I of the Substitute Form W-9, and
(iii) sign and date the Substitute Form W-9 and the Certificate of Awaiting
Taxpayer Identification Number set forth in this document. If the Payee does
not provide the Payee's TIN to the Depositary within sixty (60) days, backup
withholding will begin and continue until the Payee furnishes the Payee's TIN
to the Depositary. Note that writing "Applied For" on the Substitute Form W-9
means that the Payee has already applied for a TIN or that the Payee intends to
apply for one in the near future.
If shares are held in more than one name or are not in the name of the
actual owner, consult the W-9 Guidelines for information on which TIN to
report.
Exempt Payees (including, among others, all corporations and certain foreign
individuals) are not subject to backup withholding and reporting requirements.
To prevent possible erroneous backup withholding, an exempt Payee should write
"Exempt" in Part II of the Substitute Form W-9. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on the Substitute Form W-9 for
additional instructions. In order for a nonresident alien or foreign entity to
qualify as exempt, that person must submit a completed IRS Form W-8 Certificate
of Foreign Status or a Substitute Form W-8, signed under penalty of perjury
attesting to the exempt status. This form may be obtained from the Depositary.
14. Withholding For Non-United States Shareholders. Even if a Non-United
States Holder (as defined in Section 14 of the accompanying Offer to Purchase)
has provided the required certification to avoid backup withholding, the
Depositary will withhold United States federal income taxes equal to 30% of the
gross payments payable to a Non-United States Holder or his agent unless the
Depositary determines that a reduced rate of withholding is available under a
tax treaty or that an exemption from withholding is applicable because
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the gross proceeds are effectively connected with the conduct of a trade or
business within the United States. To obtain a reduced rate of withholding
under a tax treaty, a Non-United States Holder must deliver to the Depositary
before the payment a properly completed and executed IRS Form 1001. To obtain
an exemption from withholding on the grounds that the gross proceeds paid
pursuant to the offer are effectively connected with the conduct of a trade or
business within the United States, a Non-United States Holder must deliver to
the Depositary a properly completed and executed IRS Form 4224. A Non-United
States Holder that qualifies for an exemption from withholding by delivering
IRS Form 4224 will generally be required to file a United States federal income
tax return and will be subject to United States federal income tax on income
derived from the sale of shares pursuant to the offer in the manner and to the
extent described in Section 14 of the accompanying Offer to Purchase as if it
were a United States Holder. The Depositary will determine a shareholder's
status as a Non-United States Holder and eligibility for a reduced rate of, or
exemption from, withholding by reference to any outstanding certificates or
statements concerning eligibility for a reduced rate of, or exemption from,
withholding (e.g., IRS Form 1001 or IRS Form 4224) unless facts and
circumstances indicate that reliance is not warranted. A Non- United States
Holder may be eligible to obtain a refund of all or a portion of any tax
withheld if the Non-United States Holder meets those tests described in Section
14 of the accompanying Offer to Purchase that would characterize the exchange
as a sale (as opposed to a dividend) or is otherwise able to establish that no
tax or a reduced amount of tax is due.
Non-United States Holders are urged to consult their tax advisors regarding
the application of United States federal income tax withholding, including
eligibility for a withholding tax reduction or exemption, and the refund
procedure.
15. Lost, Stolen, Destroyed or Mutilated Certificates. If any certificate(s)
representing shares has been lost, stolen, destroyed or mutilated, the
shareholder should do the following:
. Refer to the calculation on the "Affidavit of Lost or Destroyed
Certificate(s)" form for certificate replacements under $100,000;
. Write a check payable to Seaboard Surety Company for the amount of the
replacement premium; and
. Return the "Affidavit of Lost or Destroyed Certificate(s)," the
replacement premium check, a properly completed and executed copy of the
Letter of Transmittal and any certificate(s) you may have in your
possession to the Depositary.
16. Conditional Tenders. As described in Sections 1 and 6 of the Offer to
Purchase, shareholders may condition their tenders on all or a minimum number
of their tendered shares being purchased. If Sylvan is to purchase less than
all of the shares tendered before the Expiration Date and not withdrawn, the
Depositary will perform a preliminary proration, and any shares tendered at or
below the purchase price pursuant to a conditional tender for which the
condition was not satisfied by the preliminary proration will be deemed
withdrawn, subject to reinstatement if such conditional tendered shares are
subsequently selected by random lot for purchase subject to Sections 1 and 6 of
the Offer to Purchase. Conditional tenders will be selected by lot only from
shareholders who tender all of their shares. All tendered shares will be deemed
unconditionally tendered unless the "Conditional Tender" box is completed. The
conditional tender alternative is made available so that a shareholder may
assure that the purchase of shares from the shareholder pursuant to the offer
will be treated as a sale of the shares by the shareholder, rather than the
payment of a dividend to the shareholder, for federal income tax purposes. Odd
Lot Shares, which will not be subject to proration, cannot be conditionally
tendered. It is the tendering shareholder's responsibility to calculate the
minimum number of shares that must be purchased from the shareholder in order
for the shareholder to qualify for sale (rather than dividend) treatment, and
each shareholder is urged to consult his or her own tax advisor.
In the event of proration, any shares tendered pursuant to a conditional
tender for which the minimum requirements are not satisfied may not be accepted
and thereby will be deemed withdrawn.
17. Sylvan's Employee Stock Purchase Plan. Participants in Sylvan's Employee
Stock Purchase Plan may not use this Letter of Transmittal to direct the tender
of shares held in their account under the Employee
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Stock Purchase Plan, but must comply with the instructions found in the "Letter
to Participants in Sylvan's Employee Stock Purchase Plan" sent separately to
them. Participants in the Employee Stock Purchase Plan are urged to carefully
read the "Letter to Participants in Sylvan's Employee Stock Purchase Plan" and
related materials sent to them.
18. Sylvan's 401(k) Retirement Savings Plan. Participants in Sylvan's 401(k)
Retirement Savings Plan may not use this Letter of Transmittal to direct the
tender of shares allocated to their savings plan accounts, but must comply with
the instructions found in the "Letter to Participants in Sylvan's 401(k)
Retirement Savings Plan" sent separately to them. Participants in the savings
plan are urged to carefully read the "Letter to Participants in Sylvan's 401(k)
Retirement Savings Plan" and related materials sent to them.
This Letter of Transmittal, properly completed and duly executed (or a
manually signed facsimile of this Letter of Transmittal), together with
certificates representing shares being tendered (or confirmation of book-entry
transfer) and all other required documents, or a Notice of Guaranteed Delivery,
must be received before 12:00 Midnight, Eastern time, on the Expiration Date.
Shareholders are encouraged to return a completed Substitute Form W-9 with this
Letter of Transmittal.
The Information Agent for the offer is:
D.F. King & Co., Inc.
77 Water Street, 20th Floor
New York, New York 10005
Banks and Brokers Call Collect: (212) 269-5550
All Others Call Toll Free: (800) 207-2014
The Dealer Manager for the offer is:
Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010
(800) 881-8320 (Call Toll Free)
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