Houghton Mifflin Harcourt Announces Pricing of a Secondary Offering of Common Stock

Houghton Mifflin Harcourt Company (“HMH” or the “Company”) today announced the pricing of its secondary offering of 10,575,300 shares of its common stock at a public offering price of $23.00 per share. The shares are listed on the NASDAQ Global Select Market under the symbol “HMHC.” The shares are being offered by stockholders affiliated with Paulson & Co. Inc., and the Company will not receive any proceeds from the offering. The selling stockholders have granted the underwriters an option to purchase up to an additional 1,586,295 shares of common stock in the offering. The closing of the offering is expected to occur on May 20, 2015, subject to customary closing conditions.

In addition, the Company’s expected repurchase from such stockholders of an additional $150 million of shares of common stock at a price per share equal to the public offering price (pursuant to the previously announced, privately negotiated agreement between the Company and the selling stockholders) is expected to close on May 20, 2015, subject to customary closing conditions. The shares expected to be repurchased pursuant to this agreement are separate from the shares expected to be sold in the aforementioned public offering. The obligation for the Company to consummate the stock repurchase is conditioned upon the closing of the public offering and the sale of at least 10,575,300 shares of common stock by the selling stockholders in the public offering.

Morgan Stanley and Goldman, Sachs & Co. are acting as joint book-running managers and the representatives of the underwriters, Credit Suisse and Wells Fargo Securities are acting as book-runners and BMO Capital Markets, Houlihan Lokey, Piper Jaffray and Stifel are acting as co-managers for the offering.

Copies of the final prospectus supplement and accompanying prospectus related to the offering may be obtained, when available, from both:

Morgan Stanley & Co. LLC
Attention: Prospectus Department
180 Varick Street, 2nd Floor
New York, NY 10014

Goldman, Sachs & Co.
Attention: Prospectus Department
200 West Street
New York, NY 10282
Telephone: 1-866-471-2526
Email: prospectus-ny@ny.email.gs.com

The registration statement relating to the offering of these securities was filed with the U.S. Securities and Exchange Commission (the “SEC”) and automatically became effective upon filing. The offering of these securities was made only by means of a prospectus supplement and an accompanying prospectus forming part of the effective registration statement. A copy of the registration statement can be accessed through the SEC’s website www.sec.gov. This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Houghton Mifflin Harcourt

Houghton Mifflin Harcourt (NASDAQ:HMHC) is a global learning company dedicated to changing people’s lives by fostering passionate, curious learners. As a leading provider of pre-K–12 education content, services, and cutting-edge technology solutions across a variety of media, HMH enables learning in a changing landscape. HMH is uniquely positioned to create engaging and effective educational content and experiences from early childhood to beyond the classroom. HMH serves more than 50 million students in over 150 countries worldwide, while its award-winning children's books, novels, non-fiction, and reference titles are enjoyed by readers throughout the world.

Forward-Looking Statements

The statements contained herein include forward-looking statements, which involve risks and uncertainties. These forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believes,” “estimates,” “projects,” “anticipates,” “expects,” “could,” “intends,” “may,” “will,” “should,” “forecast,” “intend,” “plan,” “potential,” “project,” “target” or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. They include statements regarding our intentions, beliefs or current expectations concerning, among other things, the consummation of the public offering and the expected stock repurchase described herein. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, of course, it is impossible for us to anticipate all factors that could affect actual results. All forward-looking statements are based upon information available to us on the date of this release.

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that actual results may differ materially from those made in or suggested by the forward-looking statements contained herein.

Important factors that could cause results to vary from expectations include, but are not limited to: difficulties or delays in, or the inability to, close the public offering or the expected stock repurchase described herein; changes in state and local education funding and/or related programs, legislation and procurement processes; adverse or worsening economic trends or the continuation of current economic conditions; changes in consumer demand for, and acceptance of, our products; changes in product mix, format and timing of delivery; changes in competitive factors; offerings by technology companies that compete with our products; industry cycles and trends; conditions and/or changes in the publishing industry; changes in or the loss of our key third-party print vendors; restrictions under agreements governing our outstanding indebtedness; changes in laws or regulations governing our business and operations; changes or failures in the information technology systems we use; demographic trends; uncertainty surrounding our ability to enforce our intellectual property rights; inability to retain management or hire employees; impact of potential impairment of goodwill and other intangibles in a challenging economy; decline or volatility of our stock price regardless of our operating performance; and other factors discussed in the “Risk Factors” section of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other news releases we issue and filings we make with the SEC. In light of these risks, uncertainties and assumptions, the forward-looking events described herein may not occur.