EDINBURG, Texas, Dec. 1, 2011 /PRNewswire/ — South Texas Higher Education Authority, Inc., a non-profit corporation organized under the laws of the State of Texas (the “Authority”) today announced that it has commenced an offer (the “Offer”) to purchase for cash consideration certain Auction Rate Bonds, upon the terms and subject to the conditions set forth in the Offer to Purchase dated December 1, 2011 (the “Offer to Purchase”). The Offer is with respect to the outstanding Senior Class Student Loan Revenue Bonds (collectively the “Senior Bonds”) issued pursuant to the Indenture of Trust dated as of March 1, 2007, as amended and supplemented to date, between the Authority and Wells Fargo Bank, National Association, as trustee.

Subject to the terms of the Offer to Purchase, the Authority will purchase the Senior Bonds accepted for purchase and for which adequate funds are available at a purchase price of 95.5% of the principal amount thereof, plus accrued interest (but excluding any ARS Interest Carryover) to the settlement date.

The Offer will expire at 12:00 p.m. (noon), Eastern Time, on December 29, 2011, unless extended or earlier terminated by the Authority (the “Expiration Time”); however, the Authority reserves the right to terminate this Offer if an aggregate of 65% in principal amount of Senior Bonds is not tendered by 5:00 p.m., Eastern time on December 22, 2011. Tendered Senior Bonds may not be withdrawn. The Authority’s obligation to purchase Senior Bonds in the Offer is subject to the terms and conditions set forth in the Offer to Purchase and requires the satisfaction or waiver of a number of conditions specified therein.

The Authority reserves the right to amend, modify or withdraw the Offer at any time. The Senior Bonds to be purchased, if any, will be selected as described in the Offer to Purchase. The Authority will promptly return any Senior Bonds that are not to be purchased by the Authority in the Offer.

Senior Bonds may be tendered by transferring Senior Bonds through The Depository Trust Company’s Automated Tender Offer Program by following the procedures set forth in detail in the Offer to Purchase.

D.F. King & Co., Inc. will act as the Information Agent and Tender Agent. Holders or their representatives may request copies of the Offer to Purchase, which contains the full terms and conditions of the Offer, and the related documents, and submit any questions or requests for assistance to:

D.F. KING & Co., Inc.

D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005

By Facsimile Transmission:
(Eligible Institutions Only)
(212) 493-6996
Banks and Brokers Call: (212) 269-5550
All Others Call Toll Free: (800) 431-9643

Email: southtexas@dfking.com
Website: www.dfking.com/southtexas

This press release is for informational purposes only and is not an offer to purchase or a solicitation of an offer to purchase with respect to any Senior Bonds. The Offer may be made solely pursuant to the terms of the Offer to Purchase. The Offer to Purchase contains important information that should be read carefully in its entirety before any decision is made to tender or not tender Senior Bonds pursuant to the Offer. The Offer is not being made to holders of Senior Bonds in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction.

About South Texas Higher Education Authority, Inc.

The Authority is a non-profit corporation which was incorporated in 1973 at the request of the City of Edinburg, Texas for the purpose of providing funds for the acquisition and servicing of federally guaranteed student loans. Under the guidance and vision of the late Lloyd M. Bentsen, Jr., former U.S. Secretary of the Treasury and U.S. Senator, the Authority was conceived with a vision to serve the South Texas community with the belief that equal access to education is the key to economic progress for all. Over 30 years later, the board of directors of the Authority remains as committed to this vision as when it was first established.

Forward-Looking Statements

Forward-looking statements in this press release, such as the scheduled expiration of the Offer, are based on current expectations. This press release contains forward-looking statements that involve a variety of business risks and other uncertainties that could cause actual results to differ materially. Words such as “expects,” “intends,” “plans,” “projects,” “believes,” “estimates” and similar expressions are used to identify these forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties, and assumptions that are difficult to predict. Forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what is expressed or forecast in these forward-looking statements. Forward-looking statements speak only as of the date made. There is no obligation to update any forward-looking statements to reflect the events or circumstances arising after the date as of which they are made. As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on the forward-looking statements included in this release or that may be made elsewhere from time to time by, or on behalf of, the Authority.

SOURCE D.F. King & Co., Inc.