Unassociated Document
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of
the
Securities Exchange Act of 1934
Filed
by
the Registrant x
Filed
by a
Party other than the Registrant o
Check
the appropriate box:
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Preliminary
Proxy Statement
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Confidential,
for Use of the Commission only (as permitted by Rule
14a-6(e)(2))
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Definitive
Proxy Statement
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Definitive
Additional Materials
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Soliciting
Material Pursuant to Rule
14a-12
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SLM
Corporation
(Name
of
Registrant as Specified in its Charter)
(Name
of
Person(s) Filing Proxy Statement, if other than the Registrant)
Payment
of Filing Fee (Check the appropriate box):
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No
fee required.
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
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(1)
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Title
of each class of securities to which transaction
applies:
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(2)
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Aggregate
number of securities to which transaction applies:
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(3)
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Per
unit price or other underlying value of transaction computed
pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing
fee is
calculated and state how it was determined):
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(4)
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Proposed
maximum aggregate value of transaction:
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(5)
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Total
fee paid:
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Fee
paid previously with preliminary materials.
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Check
box if any part of the fee is offset as provided by Exchange
Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee
was paid
previously. Identify the previous filing by registration statement
number,
or the Form or Schedule and the date of its filing.
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(1)
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Amount
Previously Paid:
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Form,
Schedule or Registration Statement No.:
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Filing
Party:
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Employee
FAQ’s
April
16,
2007
OVERVIEW:
Q.
What is
the transaction that Sallie Mae has entered into?
A.
Sallie Mae’s Board of Directors approved a definitive agreement to sell the
company to a group of investors led
by private equity firm, the J.C. Flowers & Co and group. The investor group
also includes two of the largest financial services companies in the country,
Bank of America and JP Morgan Chase. Under the agreement, the purchasers will
buy the Company for $25.2 billion or $60 per share of common stock.
Q.
Why did
the Board of Directors agree to sell the Company?
A.
Sallie Mae’s Board of Directors determined that it was in the best interest of
shareholders to accept this offer to purchase Sallie Mae. Our Board of Directors
and senior management share a fiduciary responsibility to act in the best
interest of shareholders and this transaction enhances shareholder value.
Q.
Who is
J.C. Flowers & Co.?
A.
J.C. Flowers & Co. is one of the largest investment funds on Wall Street
that is focused solely on the financial services sector. The fund has over
$900
million in commitments from financial and strategic investors. Investors in
the
Funds include ABN Amro, AIG, Banco Santander, GE, Goldman Sachs, JP Morgan
Chase
and others. JC Flowers is based in New York with an office in London.
Q.
Why do
these investors want to buy Sallie Mae?
A.
Our new investors recognize the strength of Sallie Mae and the growth prospects
for the future. All of the investors are committed to providing broader access
to higher education. While JPMorgan Chase and Bank of America are investing
in
the purchase of Sallie Mae, each will continue to operate their independent
student lending businesses, providing students, families, and schools the widest
possible choices for paying for college.
Q.
Will Sallie Mae’s business focus change as a result of this
transaction?
For
34 years, Sallie
Mae’s mission has been to increase access to higher education for all Americans.
Our commitment to serving students, schools and taxpayers is unwavering - and
will remain unchanged.
This
new chapter in our history is a testament to the growth and success our company
has experienced over the past 10 years. Sallie Mae began privatizing in 1997,
changing from a government-sponsored secondary market to a full-service
financial services provider; this step is the next logical phase of our
transformation.
Q.
When
will this transaction take place?
A.
This agreement is subject to shareholder and regulatory approvals. The actual
closing is anticipated to be in the second half of 2007.
THE
TRANSACTION
Q.
Will
Sallie Mae still be subject to government oversight as a private
company?
A.
Yes. We will continue to be regulated by Congress and the Department of
Education. We will continue to participate in the Federal Family Education
Loan
program, and be subject to all federal and state laws, including the Higher
Education Act.
Q.
What
will happen to Sallie Mae Management?
A.
The management team will remain in place. The Sallie Mae Board of Directors
will
be replaced by a new Board that consists of representatives from the new
investors. Tim Fitzpatrick will report to this Board of Directors.
Q.
Is the
deal automatic? What’s next?
A.
The transaction has been approved by Sallie Mae’s Board of Directors. Pending
the receipt of stockholder approval and expiration of the waiting period under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as well as
satisfaction of other customary closing conditions, the transaction is expected
to be completed in the second half of 2007. During the interim period before
closing, the company will continue to operate as usual and as a publicly traded
company under the direction of the current Board of Directors.
EMPLOYMENT
Q.
Do I
still work for Sallie Mae? Or, do I work for J.C. Flowers &
Co.?
A.
Sallie Mae and our subsidiary employees continue to work for Sallie Mae. The
only change that has occurred is that before, Sallie Mae was a publicly owned
corporation and after the closing it will be a privately owned
company.
Q.
How will
my career opportunities change in the new private company?
A.
The investors are making this commitment to buy Sallie Mae because they
anticipate that we will continue to grow our business. In fact, they plan on
helping us to grow - aggressively. Over the last 10 years, we have seen many
employees grow their careers along with the company. For those employees with
strong career aspirations, we encourage you to perform your job to the best
of
your ability, take a keen interest in the business, and develop a strong
professional reputation.
COMPENSATION:
Q.
Will my
pay or benefits change as a result of this announcement?
A.
Sallie Mae’s approach to rewarding employees focuses on total compensation -
including pay, benefits (such as health care and vacation), saving for the
future (e.g., the 401(k) retirement plan), and incentive plans. We regularly
review our compensation practices and benchmark them against the marketplace
and
what our employees value. There are no changes in pay or benefits to announce
at
this time. However, as a privately owned company, we will need to reexamine
our
stock equity programs to make sure that we have adequate incentive programs
in
place to reward our employees for good performance.
Q.
What
will happen to any unvested stock options or stock that I
have?
A.
In a transaction such as this, which is typically referred to as a “change of
control,” all unvested stock or stock options will vest upon the close of the
transaction. We anticipate the transaction will close in the second half of
2007. Since 1997, Sallie Mae has been generous in granting stock options to
its
employees. These options will vest and employees will receive the difference
in
value between the grant price and the $60 per share purchase price at the time
of closing. Employees will receive a payment in the amount of $60 for each
unvested share owned, less taxes.
Q.
I have a
portion of my 401(k) balance invested in the Sallie Mae Stock Fund. What happens
to that investment?
A.
At this time, employees are not required to make any changes to a 401(k) savings
account, as we continue to be a publicly traded company until the transaction
closes. The Sallie Mae Stock Fund continues to be an investment option in the
401(k) plan. At closing employees’ 401(k) investments in the stock fund will be
liquidated based on the $60 per share purchase price. The proceeds will be
deposited in the 401(k) money market for you to re-designate.
Q.
I
participate in the Sallie Mae Employee Stock Purchase Plan. What will happen
with the stock that I have purchased through the plan? What about the funds
in
the current plan’s money market account?
A.
Any stock that you hold from a previous Employee Stock Purchase Plan transaction
through the close date of the sale will also be purchased by our new investors
at the agreed upon purchase price. Under the sale agreement, all Employee Stock
Purchase plans will terminate at the close of business on April 30,
2007.
Employees
who are
currently enrolled in the plan scheduled to expire on April 30, 2007 will
continue to participate in the plan through the end date. At that time,
participants will purchase stock at $40.9615. Any stock that you hold through
the close date of the sale will be purchased by our new investors at the agreed
upon price. All remaining participants will have the balance of the money market
account plus any accrued interest refunded to them after April 30, 2007.
Q.
Who
should I contact if I have additional questions?
A.
For additional answers, please contact your local Human Resources Department
or
call the Human Resources Helpline at 1-866-ASK-SLMA.
IMPORTANT
ADDITIONAL INFORMATION REGARDING THE MERGER WILL BE FILED WITH THE
SEC:
In
connection with the proposed merger, the Company will file a proxy statement
with the Securities and Exchange Commission (the “SEC”). INVESTORS AND SECURITY
HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE
BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT THE MERGER AND THE PARTIES
TO THE MERGER. Investors and security holders may obtain a free copy of the
proxy statement (when available) and other relevant documents filed with
the SEC
from the SEC’s website at http://www.sec.gov. The Company's security holders and
other interested parties will also be able to obtain, without charge, a copy
of
the proxy statement and other relevant documents (when available) by directing
a
request by mail or telephone to Investor Relations, SLM Corporation,
12061
Bluemont Way, Reston, Va. 20190,
telephone
(703)
984-6746,
or from the
Company’s Web site, http://www.salliemae.com.
The
Company and its
directors, executive officers and other members of its management and employees
may be deemed to be participants in the solicitation of proxies from the
Company’s shareholders with respect to the Merger. Information about the
Company’s directors and executive officers and their ownership of the Company’s
common stock is set forth in the proxy statement for the Company’s 2007 Annual
Meeting of Shareholders, which was filed with the SEC on April 9, 2007.
Shareholders and investors may obtain additional information regarding the
interests of the Company and its directors and executive officers in the
Merger,
which may be different than those of the Company’s shareholders generally, by
reading the proxy statement and other relevant documents regarding the Merger,
which will be filed with the SEC.