SLM Corp SC TO-I, filed Feb 2, 2021
SLM Corp (SLM)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE TO
TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR 13(e)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
SLM CORPORATION
(Name of Subject Company (Issuer))
SLM CORPORATION, AS ISSUER
(Name of Filing Persons (Identifying status as offeror, issuer, or other person))
Common stock, par value $0.20 per share
(Title of Class of Securities)
78442P106
(CUSIP Number of Class of Securities)
Steven J. McGarry
Chief Financial Officer
300 Continental Drive
Newark, DE 19713
Telephone: (302) 451-0200
(Name, address and telephone number of person authorized to receive notices and communications on behalf of filing person)
Copies to:
John Meade
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017
(212) 450-4000
Marisa D. Stavenas
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, NY 10017
(212) 455-2000
CALCULATION OF FILING FEE
| Transaction Valuation(1) | Amount of Filing Fee(2) | |
| $1,000,000,000 | $109,100.00 | |
|
| ||
| (1) | Estimated solely for purposes of determining the amount of the filing fee. This amount is based on the offer to purchase up to $1,000,000,000 in value of shares of common stock, par value $0.20 per share, of SLM Corporation. |
| (2) | The amount of the filing fee, calculated in accordance with Rule 0-11 under the Securities Exchange Act of 1934, as amended, and Fee Rate Advisory No. 1 for fiscal year 2021, equals $109.10 per million dollars of the transaction. |
| ☐ | Check the box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| Amount Previously Paid: Not applicable | Filing Party: Not applicable | |
| Form or Registration No: Not applicable | Date Filed: Not applicable |
| ☐ | Check the box if filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| ☐ | third-party tender offer subject to Rule 14d-1. |
| ☒ | issuer tender offer subject to Rule 13e-4. |
| ☐ | going-private transaction subject to Rule 13e-3. |
| ☐ | amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer: ☐
If applicable, check the appropriate box(es) below to designate the appropriate rule provision(s) relied upon:
| ☐ | Rule 13e-4(i) (Cross-Border Issuer Tender Offer) |
| ☐ | Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) |
This Tender Offer Statement on Schedule TO (this “Schedule TO”) is being filed by SLM Corporation, a Delaware corporation (the “Company”), and relates to the offer by the Company to purchase for cash up to $1,000,000,000 in value of shares of its common stock, par value $0.20 per share (the “Common Stock”), at a price per share not less than $13.10 and not more than $15.00 in cash, without interest. Applicable withholding taxes will be deducted from payments to tendering holders. The Company’s offer is being made upon the terms and subject to the conditions set forth in the Offer to Purchase, dated February 2, 2021 (as it may be amended or supplemented from time to time, the “Offer to Purchase”) and in the related Letter of Transmittal (as it may be amended or supplemented from time to time, the “Letter of Transmittal,” and together with the Offer to Purchase, the “Offer”).
Copies of the Offer to Purchase and Letter of Transmittal are filed with this Schedule TO as Exhibits (a)(1)(i) and (a)(1)(ii), respectively. The Offer will expire at 12:00 midnight, New York City time, at the end of the day on March 2, 2021, unless the Offer is extended or earlier terminated. This Schedule TO is being filed in accordance with Rule 13e-4(c)(2) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The information contained in the Offer to Purchase and the related Letter of Transmittal is hereby expressly incorporated by reference in response to all items of this Schedule TO, and as more particularly set forth below.
| ITEM 1. | Summary Term Sheet. |
The information set forth in the Offer to Purchase under the heading “Summary Term Sheet” is incorporated herein by reference.
| ITEM 2. | Subject Company Information. |
(a) Name and Address. The name of the subject company, and the address and telephone number of its principal executive offices are as follows:
SLM Corporation
300 Continental Drive
Newark, DE 19713
(302) 451-0200
(b) Securities. This Schedule TO relates to the Company’s Common Stock. As of January 27, 2021, the Company had 375,914,746 issued and outstanding shares of Common Stock (and 6,142,800 shares reserved for issuance upon exercise of stock options (“Stock Options”) and vesting of restricted stock units (“RSUs”) and performance-based share unit awards (“PSUs”) (assuming PSUs vest at the specified target performance threshold)). The information set forth in the section of the Offer to Purchase titled “Introduction” is incorporated herein by reference.
(c) Trading Market and Price. The information set forth in Section 8 of the Offer to Purchase, “Price Range of Shares; Dividends,” is incorporated herein by reference.
| ITEM 3. | Identity and Background of Filing Person. |
(a) The information set forth under Item 2(a) above and in Section 10 of the Offer to Purchase, “Certain Information Concerning Us,” is incorporated herein by reference. The Company is the filing person and issuer. Pursuant to General Instruction C to Schedule TO, the following persons are the directors and/or executive officers of the Company:
| Name |
Position | |
| Paul G. Child | Director. | |
| Mary Carter Warren Franke | Director. | |
| Earl A. Goode | Director. | |
| Marianne M. Keler | Director. | |
| Mark L. Lavelle | Director. |
| Name |
Position | |
| Jim Matheson | Director. | |
| Frank C. Puleo | Director. | |
| Vivian C. Schneck-Last | Director. | |
| William N. Shiebler | Director. | |
| Robert S. Strong | Director. | |
| Jonathan W. Witter | Director, Chief Executive Officer. | |
| Kirsten O. Wolberg | Director. | |
| Steven J. McGarry | Executive Vice President and Chief Financial Officer. | |
| Donna F. Vieira | Executive Vice President and Chief Commercial Officer. | |
| Jonathan R. Boyles | Senior Vice President and Controller. | |
| Kerri A. Palmer | Executive Vice President and Chief Risk and Compliance Officer. | |
| Nicolas Jafarieh | Senior Vice President and Chief Legal, Government Affairs, and Communications Officer. | |
| Daniel P. Kennedy | Executive Vice President and Chief Operational Officer. |
The business address and telephone number for all of the above directors and executive officers is: c/o SLM Corporation, 300 Continental Drive, Newark, DE 19713, (302) 451-0200.
There is neither any person controlling the Company nor any executive officer or director of any corporation or other person ultimately in control of the Company.
| ITEM 4. | Terms of the Transaction. |
(a) Material Terms.
(a)(1)(i) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet” and in Section 1, “Number of Shares; Proration,” is incorporated herein by reference.
(a)(1)(ii) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 1, “Number of Shares; Proration,” in Section 5, “Purchase of Shares and Payment of Purchase Price,” and in Section 9, “Source and Amount of Funds,” is incorporated herein by reference.
(a)(1)(iii) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 1, “Number of Shares; Proration,” and in Section 14, “Extension of the Tender Offer; Termination; Amendment,” is incorporated herein by reference.
(a)(1)(iv) Not applicable.
(a)(1)(v) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet” and in Section 14, “Extension of the Tender Offer; Termination; Amendment,” is incorporated herein by reference.
(a)(1)(vi) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 4, “Withdrawal Rights,” and in Section 6, “Conditional Tender of Shares,” is incorporated herein by reference.
(a)(1)(vii) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 3, “Procedures for Tendering Shares,” in Section 4, “Withdrawal Rights,” and in Section 6, “Conditional Tender of Shares,” is incorporated herein by reference.
(a)(1)(viii) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 3, “Procedures for Tendering Shares,” in Section 5, “Purchase of Shares and Payment of Purchase Price,” and in Section 6, “Conditional Tender of Shares,” is incorporated herein by reference.
(a)(1)(ix) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 1, “Number of Shares; Proration,” in Section 5, “Purchase of Shares and Payment of Purchase Price,” and in Section 6, “Conditional Tender of Shares,”is incorporated herein by reference.
(a)(1)(x) Not applicable.
(a)(1)(xi) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet” and in Section 2, “Purpose of the Tender Offer; Certain Effects of the Tender Offer,” is incorporated herein by reference.
(a)(1)(xii) The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 3, “Procedures for Tendering Shares,” and Section 13, “Material U.S. Federal Income Tax Consequences,” is incorporated herein by reference.
(a)(2)(i-vii) Not applicable.
(b) Purchases. The information set forth in the Offer to Purchase in Section 11, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares,” is incorporated herein by reference.
| ITEM 5. | Past Contacts, Transactions, Negotiations and Agreements. |
(e) Agreements Involving the Subject Company’s Common Stock. The information set forth in Section 11, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares,” is incorporated herein by reference.
| ITEM 6. | Purposes of the Transaction and Plans or Proposals. |
(a) Purposes. The information set forth in the Offer to Purchase under the heading “Summary Term Sheet” and in Section 2, “Purpose of the Tender Offer; Certain Effects of the Tender Offer,” is incorporated herein by reference.
(b) Use of Securities Acquired. The information set forth in Section 2 of the Offer to Purchase, “Purpose of the Tender Offer; Certain Effects of the Tender Offer,” is incorporated herein by reference.
(c) Plans. Except for the Offer, the Company does not have, and to the best of its knowledge is not aware of any plans, proposals or negotiations that relate to or would result in any of the events listed in Regulation M-A Item 1006(c)(1) through (10).
The information set forth in the Offer to Purchase in Section 1, “Number of Shares; Proration,” and in Section 2, “Purpose of the Tender Offer; Certain Effects of the Tender Offer,” is incorporated herein by reference.
| ITEM 7. | Source and Amount of Funds or Other Consideration. |
(a) Source of Funds. The information set forth in the Offer to Purchase under the heading “Summary Term Sheet” and in Section 9, “Source and Amount of Funds,” is incorporated herein by reference.
(b) Conditions. The information set forth in the Offer to Purchase under the heading “Summary Term Sheet,” in Section 1, “Number of Shares; Proration,” and in Section 7, “Conditions of the Tender Offer,” is incorporated herein by reference. There is no financing condition for the Offer.
(d) Borrowed Funds. Not applicable.
| ITEM 8. | Interest in Securities of the Subject Company. |
(a) Securities Ownership. The information set forth in Section 11 of the Offer to Purchase, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares,” is incorporated herein by reference.
(b) Securities Transactions. The information set forth in Section 11 of the Offer to Purchase, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares,” is incorporated herein by reference.
| ITEM 9. | Persons/Assets, Retained, Employed, Compensated or Used. |
(a) Solicitations or Recommendations. The information set forth in Section 15 of the Offer to Purchase, “Fees and Expenses; Information Agent; Dealer Managers; Depositary,” is incorporated herein by reference.
| ITEM 10. | Financial Statements. |
(a) Financial Information. Not applicable.
(b) Pro Forma Information. Not applicable.
| ITEM 11. | Additional Information. |
(a) Agreements, Regulatory Requirements and Legal Proceedings. The information set forth in Section 11 of the Offer to Purchase, “Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares,” and in Section 12 of the Offer to Purchase, “Legal Matters; Regulatory Approvals,” is incorporated herein by reference.
(c) Other Material Information. The information set forth in the Offer to Purchase and the related Letter of Transmittal, copies of which are filed as Exhibits (a)(1)(i) and (a)(1)(ii) hereto, respectively, as each may be amended or supplemented from time to time, is incorporated herein by reference. The Company will amend this Schedule TO to include documents that the Company may file with the SEC after the date of the Offer to Purchase pursuant to Section 13(a), 13(c) or 14 of the Exchange Act and prior to the expiration of the Offer to the extent required by Rule 13e-4(d)(2) promulgated under the Exchange Act. The information contained in all of the exhibits referred to in Item 12 below is incorporated herein by reference.
| ITEM 12. | Exhibits. |
See Exhibits Index.
| ITEM 13. | Information Required by Schedule 13E-3. |
Not applicable.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| SLM CORPORATION | ||||
| By: | /s/ Steven J. McGarry | |||
| Name: | Steven J. McGarry | |||
| Title: | Executive Vice President and Chief Financial Officer | |||
Date: February 2, 2021
EXHIBIT INDEX
| (a)(1)(i) | Offer to Purchase, dated February 2, 2021. | |
| (a)(1)(ii) | Form of Letter of Transmittal. | |
| (a)(1)(iii) | Notice of Guaranteed Delivery. | |
| (a)(1)(iv) | Letter to brokers, dealers, commercial banks, trust companies and other nominees, dated February 2, 2021. | |
| (a)(1)(v) | Letter to clients for use by brokers, dealers, commercial banks, trust companies and other nominees, dated February 2, 2021. | |
| (a)(1)(vi) | Summary Advertisement, dated February 2, 2021. | |
| (a)(2) | Not applicable. | |
| (a)(3) | Not applicable. | |
| (a)(4) | Not applicable. | |
| (a)(5)(i) | Press Release, dated February 2, 2021 (incorporated by reference to Exhibit 99.1 the Company’s Current Report on Form 8-K filed on February 2, 2021). | |
| (b) | Not applicable. | |
| (d)(1) | Form of Separation and Distribution Agreement by and among SLM Corporation, New BLC Corporation and Navient Corporation, dated as of April 28, 2014 (incorporated by reference to Exhibit 2.2 of the Company’s Current Report on Form 8-K filed on May 2, 2014). | |
| (d)(2) | Restated Certificate of Incorporation of the Company, dated February 25, 2015 (incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K filed on February 26, 2015). | |
| (d)(3) | Amended and Restated By-Laws of the Company effective June 25, 2015 (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed on June 29, 2015). | |
| (d)(4) | Indenture, dated as of June 17, 2015, between SLM Corporation and Deutsche Bank National Trust Company, as Trustee (incorporated by reference to Exhibit 4.3 of the Company’s Registration Statement on Form S-3 filed on June 17, 2015). | |
| (d)(5) | First Supplemental Indenture dated as of April 5, 2017 between SLM Corporation and Deutsche Bank National Trust Company, as Trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on April 5, 2017). | |
| (d)(6) | Second Supplemental Indenture dated as of October 29, 2020 between SLM Corporation and Deutsche Bank National Trust Company, as Trustee (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed on October 29, 2020). | |
| (d)(7) | Form of Senior Note due 2025 (incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K filed on October 29, 2020). | |
| (d)(8) | Form of SLM Corporation Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (one-year restriction), 2014 Management Incentive Plan Award (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2015). | |
| (d)(9) | Form of SLM Corporation Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (two-year restriction), 2014 Management Incentive Plan Award (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2015). | |
| (d)(10) | Form of SLM Corporation Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (three-year restriction), 2014 Management Incentive Plan Award (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2015). | |
| (d)(11) | Form of SLM Corporation Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (one-year restriction), 2015 Management Incentive Plan Award (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016). | |
| (d)(12) | Form of SLM Corporation Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (two-year restriction), 2015 Management Incentive Plan Award (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016). | |
| (d)(13) | Form of SLM Corporation Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (three-year restriction), 2015 Management Incentive Plan Award (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016). | |
| (d)(14) | Form of SLM Corporation 2012 Omnibus Incentive Plan, Restricted Stock Unit Term Sheet - 2015 (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2015). | |
| (d)(15) | Form of SLM Corporation 2012 Omnibus Incentive Plan, Restricted Stock Unit Term Sheet - 2016 (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016). | |
| (d)(16) | Form of SLM Corporation 2012 Omnibus Incentive Plan, Performance Stock Unit Term Sheet - 2016 (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed on April 20, 2016). | |
| (d)(17) | Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement 2015 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2015). | |
| (d)(18) | Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement - 2016 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 20, 2016). | |
| (d)(19) | SLM Corporation Executive Severance Plan for Senior Officers, including amendments as of June 25, 2015 (incorporated by reference to Exhibit 10.6 of the Company’s Annual Report on Form 10-K filed on February 26, 2016). | |
| (d)(20) | SLM Corporation Change in Control Severance Plan for Senior Officers, including amendments as of June 25, 2015 (incorporated by reference to Exhibit 10.7 of the Company’s Annual Report on Form 10-K filed on February 26, 2016). | |
| (d)(21) | Form of Director’s Indemnification Agreement (incorporated by reference to Exhibit 10.24 of the Company’s Annual Report on Form 10-K filed on February 27, 2012). | |
| (d)(22) | Sallie Mae Supplemental 401(k) Savings Plan, as Amended and Restated as of June 25, 2015 (incorporated by reference to Exhibit 10.9 of the Company’s Annual Report on Form 10-K filed on February 26, 2016). | |
| (d)(23) | Amendment to Sallie Mae Supplemental 401(k) Savings Plan (Effective as of March 5, 2019) (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019). | |
| (d)(24) | SLM Deferred Compensation Plan for Key Employees, as Established Effective May 1, 2014 and Amended June 25, 2015 (incorporated by reference to Exhibit 10.10 of the Company’s Annual Report on Form 10-K filed on February 26, 2016). | |
| (d)(25) | Amendment to SLM Corporation Deferred Compensation Plan for Key Employees (Effective as of March 5, 2019) (incorporated by reference to Exhibit 10.6 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019). | |
| (d)(26) | SLM Corporation Deferred Compensation Plan for Directors, as Established Effective May 1, 2014 and Amended June 25, 2015 (incorporated by reference to Exhibit 10.11 of the Company’s Annual Report on Form 10-K filed on February 26, 2016). | |
| (d)(27) |
Amended and Restated SLM Corporation Incentive Plan (incorporated by reference to Exhibit 10.24 of the Company’s Current Report on Form 8-K (file no. 001-13251) filed on May 25, 2005). | |
| (d)(28) |
Director’s Stock Plan (incorporated by reference to Exhibit 10.25 of the Company’s Current Report on Form 8-K (file no. 001-13251) filed on May 25, 2005). | |
| (d)(29) |
Form of SLM Corporation Incentive Stock Plan Stock Option Agreement, Net-Settled, Performance Vested Options, 2009 (incorporated by reference to Exhibit 10.32 of the Company’s Annual Report on Form 10-K filed on March 2, 2009). | |
| (d)(30) |
SLM Corporation Directors Equity Plan (incorporated by reference to Exhibit 10.1 of the Company’s Registration Statement on Form S-8 (File No. 333-159447) filed on May 22, 2009). | |
| (d)(31) |
SLM Corporation 2009-2012 Incentive Plan (incorporated by reference to Exhibit 10.2 of the Company’s Registration Statement on Form S-8 (File No. 333-159447) filed on May 22, 2009). | |
| (d)(32) |
Form of SLM Corporation Directors Equity Plan Non-Employee Director Stock Option Agreement - 2009 (incorporated by reference to Exhibit 10.6 of the Company’s Quarterly Report on Form 10-Q filed on November 5, 2009). | |
| (d)(33) |
Form of SLM Corporation 2009-2012 Incentive Plan Stock Option Agreement, Net Settled, Time Vested Options - 2010 (incorporated by reference to Exhibit 10. 7 of the Company’s Quarterly Report on Form 10-Q filed on May 6, 2010). | |
| (d)(34) |
Form of SLM Corporation 2009-2012 Incentive Plan Performance Stock Award Term Sheet, Time Vested - 2010 (incorporated by reference to Exhibit 10.8 of the Company’s Quarterly Report on Form 10-Q filed on May 6, 2010). | |
| (d)(35) |
Amendment to Stock Option and Restricted/Performance Stock Terms (incorporated by reference to Exhibit 10.49 of the Company’s Annual Report on Form 10-K filed on February 28, 2011). | |
| (d)(36) |
Form of SLM Corporation 2009-2012 Incentive Plan Stock Option Agreement, Net Settled, Time Vested Options - 2011 (incorporated by reference to Exhibit 10.50 of the Company’s Annual Report on Form 10-K filed on February 28, 2011). | |
| (d)(37) |
Form of SLM Corporation 2009-2012 Incentive Plan Restricted Stock and Restricted Stock Unit Term Sheet, Time Vested - 2011 (incorporated by reference to Exhibit 10.51 of the Company’s Annual Report on Form 10-K filed on February 28, 2011). | |
| (d)(38) |
Form of SLM Corporation 2009-2012 Incentive Plan, Performance Stock Unit Term Sheet - 2012 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on May 4, 2012). | |
| (d)(39) |
Form of SLM Corporation 2009-2012 Incentive Plan, Bonus Restricted Stock Unit Term Sheet - 2012 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on May 4, 2012). | |
| (d)(40) |
Form of SLM Corporation 2009-2012 Incentive Plan, Stock Option Agreement, Net Settled Options - 2012 (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on May 4, 2012). | |
| (d)(41) |
SLM Corporation 2012 Omnibus Incentive Plan (incorporated by reference to Appendix A of the Company’s Definitive Proxy Statement for the 2017 Annual Meeting of Shareholders filed on April 27, 2017). | |
| (d)(42) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Performance Stock Unit Term Sheet - 2013 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2013). | |
| (d)(43) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet - 2013 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2013). | |
| (d)(44) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Stock Option Agreement, Net Settled Options-2013 (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2013). | |
| (d)(45) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement - 2013 (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2013). | |
| (d)(46) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Stock Option Agreement - 2013 (incorporated by reference to Exhibit 10.5 of the Company’s Quarterly Report on Form 10-Q filed on May 3, 2013). | |
| (d)(47) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Restricted Stock Unit Term Sheet - 2013 (incorporated by reference to Exhibit 10.36 of the Company’s Annual Report on Form 10-K filed on February 19, 2014). | |
| (d)(48) |
Letter Agreement, dated January 15, 2014 with Raymond J. Quinlan (incorporated by reference to Exhibit 10.38 of the Company’s Annual Report on Form 10-K filed on February 19, 2014). | |
| (d)(49) |
SLM Corporation 2012 Omnibus Incentive Plan, Restricted Stock Unit Term Sheet - Raymond J. Quinlan Signing Award (incorporated by reference to Exhibit 10.39 of the Company’s Annual Report on Form 10-K filed on February 19, 2014). | |
| (d)(50) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet - 2014 (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on May 12, 2014). | |
| (d)(51) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Restricted Stock Unit Term Sheet - 2014 (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on May 12, 2014). | |
| (d)(52) |
Sallie Mae Employee Stock Purchase Plan, Amended and Restated as of June 24, 2014, Including Amendments as of June 25, 2015 (incorporated by reference to Exhibit 10.39 of the Company’s Annual Report on Form 10-K filed on February 26, 2016). | |
| (d)(53) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on July 24, 2014). | |
| (d)(54) |
Letter Agreement, dated April 24, 2014, with Jeffrey Dale (incorporated by reference to Exhibit 10.41 to the Company’s Annual Report on Form 10-K filed on February 26, 2015). | |
| (d)(55) |
Sallie Mae 401(k) Savings Plan (Effective as of April 30, 2014) (incorporated by reference to Exhibit 10.44 to the Company’s Annual Report on Form 10-K filed on February 26, 2015). | |
| (d)(56) |
Restatement of the Sallie Mae 401(k) Savings Plan (Effective as of January 1, 2018) (incorporated by reference to Exhibit 10.50 of the Company’s Annual Report on Form 10-K filed on February 28, 2020). | |
| (d)(57) |
Amendment to Sallie Mae 401(k) Savings Plan (Effective as of January 1, 2019) (incorporated by reference to Exhibit 10.51 of the Company’s Annual Report on Form 10-K filed on February 28, 2020). | |
| (d)(58) |
Amendment to Sallie Mae 401(k) Savings Plan (Effective as of March 5, 2019) (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019). | |
| (d)(59) |
Tax Sharing Agreement between Navient Corporation and New BLC Corporation, dated as of April 29, 2014 (incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K filed on May 2, 2014). | |
| (d)(60) |
Amended and Restated Loan Servicing and Administration Agreement between Sallie Mae Bank and Navient Solutions, Inc., dated as of April 30, 2014 (incorporated by reference to Exhibit 10.4 of the Company’s Current Report on Form 8-K filed on May 2, 2014). | |
| (d)(61) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (Three-Year Restriction), 2016 Management Incentive Plan Award (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 19, 2017). | |
| (d)(62) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2017 Restricted Stock Unit Term Sheet (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 19, 2017). | |
| (d)(63) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2017 Performance Stock Unit Term Sheet (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 19, 2017). | |
| (d)(64) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2017 Independent Director Restricted Stock Agreement (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 19, 2017). | |
| (d)(65) |
Agreement and Release, dated as of March 20, 2018, between the Company and the Personal Representatives of the Estate of Charles P. Rocha (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 23, 2018). | |
| (d)(66) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2018 Restricted Stock Unit Term Sheet (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 23, 2018). | |
| (d)(67) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2018 Performance Stock Unit Term Sheet (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 23, 2018). | |
| (d)(68) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2018 Bonus Restricted Stock Unit Term Sheet (Three-Year Restriction), 2017 Management Incentive Plan Award (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 23, 2018). | |
| (d)(69) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement - 2018 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 24, 2018). | |
| (d)(70) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2019 Restricted Stock Unit Term Sheet (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019). | |
| (d)(71) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2019 Performance Stock Unit Term Sheet (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019). | |
| (d)(72) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Bonus Restricted Stock Unit Term Sheet (Three-Year Restriction), 2018 Management Incentive Plan Award (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 17, 2019). | |
| (d)(73) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement - 2019 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 24, 2019). | |
| (d)(74) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2020 Restricted Stock Unit Term Sheet (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2020). | |
| (d)(75) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, 2020 Performance Stock Unit Term Sheet (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2020). | |
| (d)(76) |
Offer Letter between Jonathan W. Witter and the Company dated March 4, 2020 (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2020). | |
| (d)(77) |
Fixed Dollar Uncollared ASR Master Confirmation and Form of Supplement (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on April 22, 2020). | |
| (d)(78) |
Form of SLM Corporation 2012 Omnibus Incentive Plan, Independent Director Restricted Stock Agreement – 2020 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2020). | |
| (d)(79) |
Separation Agreement between Raymond J. Quinlan and the Company effective April 19, 2020 (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2020). | |
| (d)(80) |
Jonathan W. Witter Sign-On Equity Grant - 2020 Restricted Stock Unit Term Sheet (incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2020). | |
| (d)(81) |
Offer Letter between Donna F. Vieira and the Company dated September 18, 2018 (incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q filed on July 22, 2020). | |
| (d)(82) |
Separation Agreement between Paul Thome and the Company effective August 10, 2020 (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q filed on October 21, 2020). | |
| (g) |
Not applicable. | |
| (h) |
Not applicable. | |
| * Previously filed. | ||
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Exhibit (a)(1)(i)
SLM Corporation
Offer to Purchase for Cash
Up to $1,000,000,000 in Value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and Not More Than $15.00 Per Share
| THE TENDER OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021, UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN. |
SLM Corporation, a Delaware corporation (“SLM,” the “Company,” “we,” “us,” or “our”), hereby offers to purchase for cash up to $1,000,000,000 in value of shares of its issued and outstanding common stock, par value $0.20 per share (the “shares”), at a price not less than $13.10 per share and not more than $15.00 per share (the price as determined as provided herein, the “Purchase Price”), without interest, upon the terms and subject to the conditions set forth in this Offer to Purchase, the related Letter of Transmittal and the other materials filed as exhibits to the Issuer Tender Offer Statement on Schedule TO-I that we have filed with the U.S. Securities and Exchange Commission (the “Commission”) (such materials, collectively, as they may be amended or supplemented from time to time, the “tender offer materials”). Applicable withholding taxes will be deducted from payments to tendering holders. The terms and conditions set forth in the tender offer materials collectively constitute the “tender offer.” The tender offer will expire at 12:00 midnight, New York City time, at the end of the day on March 2, 2021 (such date and time, as the same may be extended, the “Expiration Date”), unless extended or earlier terminated.
Upon the terms and subject to the conditions of this Offer to Purchase, including the provisions relating to “odd lot” priority, proration and conditional tenders described in this Offer to Purchase, we will determine a single per share price that we will pay for shares properly tendered and not properly withdrawn pursuant to the tender offer, taking into account the total number of shares tendered and the prices specified by tendering stockholders. We will select the lowest Purchase Price (in increments of $0.10), which will be not less than $13.10 per share and not more than $15.00 per share, that will allow us to purchase a number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. Upon the terms and subject to the conditions of the tender offer, if shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn, we will buy all shares properly tendered at prices at or below the Purchase Price and not properly withdrawn prior to the Expiration Date.
Our shares are listed and traded on the NASDAQ Global Select Market (“NASDAQ”) under the trading symbol “SLM.” On February 1, 2021, the last trading day prior to the commencement by the Company of the tender offer, the last reported sale price of the shares on the NASDAQ was $13.78 per share. The minimum purchase price of $13.10 per share is below the closing price for the shares on February 1, 2021, the last full trading day before announcement and commencement of the tender offer, and could be below the closing price of our common stock on the Expiration Date. You are urged to obtain current market quotations for the shares. See Section 8.
As of January 27, 2021, we had 375,914,746 issued and outstanding shares (and 6,142,800 shares reserved for issuance upon exercise of stock options (“Stock Options”) and vesting of restricted stock units (“RSUs”) and performance stock units (“PSUs”) (assuming PSUs vest at the specified target performance threshold)). Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $15.00, the maximum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 66,666,666 shares, which would represent approximately 17.73% of our issued and outstanding shares as of January 27, 2021 (which excludes shares that would result from the assumed exercise of Stock Options and the assumed vesting of RSUs and PSUs (“Potential
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Shares”)), or approximately 17.45% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares). If the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $13.10, the minimum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 76,335,877 shares, which would represent approximately 20.31% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 19.98% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares).
We will purchase at the Purchase Price shares properly tendered at prices equal to or below the Purchase Price and not properly withdrawn, on the terms and subject to the conditions of the tender offer, including the proration, conditional tender and “odd lot” priority provisions. We will not purchase shares tendered at prices greater than the Purchase Price or shares that we do not accept for purchase under the terms of the tender offer because of the tender offer’s proration, conditional tender and priority provisions. Shares tendered but not purchased in the tender offer will be returned to the tendering stockholders at our expense promptly after the expiration of the tender offer.
If shares having an aggregate purchase price of more than $1,000,000,000 are tendered in the tender offer and not properly withdrawn, we reserve the right to accept for purchase at the Purchase Price pursuant to the tender offer up to an additional 2% of our outstanding shares without amending or extending the tender offer. We also expressly reserve the right, in our sole discretion, to purchase additional shares of our common stock subject to applicable legal and regulatory requirements. See Section 1.
After tenders of shares have been accepted for purchase by us, payment will be paid through Computershare Trust Company, N.A., the depositary for the tender offer (the “Depositary”), which will act as agent for the purpose of receiving payment from us and transmitting payment to the tendering stockholders. See Section 5.
THE TENDER OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE TENDER OFFER IS, HOWEVER, SUBJECT TO OTHER CONDITIONS. SEE SECTION 7.
Neither the Commission nor any state securities commission has approved or disapproved of this transaction or passed upon the merits or fairness of such transaction or passed upon the adequacy or accuracy of the information contained in this Offer to Purchase. Any representation to the contrary is a criminal offense.
The Dealer Managers for the Tender Offer are:
| J.P. Morgan Securities LLC | Goldman Sachs & Co. LLC |
The Information Agent for the Tender Offer is:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Attention: Corporate Actions
Banks and Brokers call: (212) 269-5550
or
Call Toll-Free: (877) 283-0322
Email: slm@dfking.com
The date of this Offer to Purchase is February 2, 2021
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IMPORTANT
Questions and requests for assistance may be directed to D.F. King & Co., Inc., the information agent for the tender offer (the “Information Agent”) or to J.P. Morgan Securities LLC or Goldman Sachs & Co. LLC, the dealer managers for the tender offer (the “Dealer Managers”), at their respective telephone numbers and addresses set forth on the back cover of this Offer to Purchase. You may request additional copies of the tender offer materials from the Information Agent or the Dealer Managers at their respective telephone numbers and addresses set forth on the back cover of this Offer to Purchase. Stockholders may also contact their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the tender offer.
If you want to tender all or some of your shares, you must do one of the following before the tender offer expires:
| • | if your shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, contact such nominee and have such nominee tender your shares for you; |
| • | if you are an institution participating in The Depository Trust Company, referred to as “Book-Entry Transfer Facility” in this Offer to Purchase, tender your shares according to the procedure for book-entry transfer described in Section 3 of this Offer to Purchase; or |
| • | if you hold certificates or book-entry shares in your own name, complete and sign a Letter of Transmittal according to its instructions and deliver it, together with any required signature guarantees, the certificates for your shares and any other documents required by the Letter of Transmittal, to the Depositary, at its address shown on the Letter of Transmittal. |
Beneficial owners should be aware that their broker, dealer, commercial bank, trust company or other nominee may establish its own earlier deadline for participation in the tender offer. Accordingly, beneficial owners wishing to participate in the tender offer should contact their broker, dealer, commercial bank, trust company or other nominee as soon as possible in order to determine the times by which such owner must take action in order to participate in the tender offer.
If you want to tender your shares but your certificates for the shares are not immediately available or cannot be delivered to the Depositary within the required time or you cannot comply with the procedures for book-entry transfer, or your other required documents cannot be delivered to the Depositary by the Expiration Date of the tender offer, you may still tender your shares if you comply with the guaranteed delivery procedure described in Section 3 of this Offer to Purchase.
TO TENDER SHARES PROPERLY, OTHER THAN SHARES REGISTERED IN THE NAME OF A BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE, YOU MUST PROPERLY COMPLETE AND DULY EXECUTE THE LETTER OF TRANSMITTAL.
THIS TENDER OFFER DOES NOT CONSTITUTE AN OFFER TO PURCHASE SHARES IN ANY JURISDICTION IN WHICH, OR FROM ANY PERSON FROM WHOM, IT IS UNLAWFUL TO MAKE THE TENDER OFFER UNDER APPLICABLE SECURITIES OR BLUE SKY LAWS, PROVIDED THAT WE WILL COMPLY WITH THE REQUIREMENTS OF RULE 13E-4(F)(8) PROMULGATED UNDER THE U.S. SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE “EXCHANGE ACT”). SUBJECT TO APPLICABLE LAW (INCLUDING RULE 13E-4(D)(2) UNDER THE EXCHANGE ACT, WHICH REQUIRES THAT MATERIAL CHANGES IN THE TENDER OFFER BE PROMPTLY DISSEMINATED TO SECURITY HOLDERS IN A MANNER REASONABLY DESIGNED TO INFORM THEM OF SUCH CHANGES), DELIVERY OF THIS OFFER TO PURCHASE SHALL NOT UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS OFFER TO PURCHASE IS CORRECT AS OF ANY TIME AFTER THE DATE OF THIS OFFER TO PURCHASE OR THAT THERE HAS BEEN NO CHANGE IN THE INFORMATION INCLUDED OR INCORPORATED BY REFERENCE HEREIN OR IN OUR AFFAIRS SINCE THE DATE HEREOF.
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OUR BOARD OF DIRECTORS HAS APPROVED THE TENDER OFFER. HOWEVER, NONE OF THE COMPANY, OUR BOARD OF DIRECTORS, THE DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY OR ANY OF OUR OR THEIR RESPECTIVE AFFILIATES MAKES ANY RECOMMENDATION TO YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES OR AT WHAT PRICE OR PRICES YOU SHOULD TENDER YOUR SHARES. YOU MUST MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH YOU CHOOSE TO TENDER SUCH SHARES. IN SO DOING, YOU SHOULD READ CAREFULLY ALL OF THE INFORMATION IN THIS OFFER TO PURCHASE, AND IN THE OTHER TENDER OFFER MATERIALS, INCLUDING OUR REASONS FOR MAKING THE TENDER OFFER. SEE SECTION 2. YOU ARE URGED TO DISCUSS YOUR DECISIONS WITH YOUR TAX ADVISOR, FINANCIAL ADVISOR AND/OR BROKER. NONE OF THE COMPANY’S DIRECTORS OR EXECUTIVE OFFICERS WILL TENDER ANY OF THEIR SHARES IN THE TENDER OFFER. SEE SECTION 11.
WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON OUR BEHALF AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES IN THE TENDER OFFER OR AT WHAT PRICE OR PRICES YOU SHOULD TENDER YOUR SHARES. WE HAVE NOT AUTHORIZED ANY PERSON TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE TENDER OFFER OTHER THAN THOSE CONTAINED IN THIS DOCUMENT OR INCORPORATED BY REFERENCE OR IN THE RELATED LETTER OF TRANSMITTAL. IF ANYONE MAKES ANY RECOMMENDATION OR REPRESENTATION TO YOU OR GIVES YOU ANY INFORMATION, YOU MUST NOT RELY ON THAT RECOMMENDATION, REPRESENTATION OR INFORMATION AS HAVING BEEN AUTHORIZED BY US, THE DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY OR ANY OF OUR OR THEIR RESPECTIVE AFFILIATES.
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| 11 | ||||
| 13 | ||||
| 16 | ||||
| 16 | ||||
| 2. Purpose of the Tender Offer; Certain Effects of the Tender Offer. |
18 | |||
| 20 | ||||
| 25 | ||||
| 25 | ||||
| 27 | ||||
| 27 | ||||
| 29 | ||||
| 30 | ||||
| 30 | ||||
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| 34 | ||||
| 34 | ||||
| 39 | ||||
| 15. Fees and Expenses; Information Agent; Dealer Managers; Depositary. |
40 | |||
| 40 |
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We are providing this summary term sheet for your convenience. It highlights certain material information in this Offer to Purchase, but you should realize that it does not describe all of the details of the tender offer to the same extent described elsewhere in this Offer to Purchase. We urge you to read carefully the entire Offer to Purchase, the related Letter of Transmittal and the other tender offer materials because they contain the full details of the tender offer. We have included references to the sections of this Offer to Purchase where you will find a more complete discussion.
Who is offering to purchase my shares?
We (SLM Corporation) are offering to purchase your shares. See Section 1.
What will be the Purchase Price for the shares?
We are conducting an offer by means of a modified “Dutch auction.” This procedure allows you to select the price (in increments of $0.10) within a price range specified by us at which you are willing to sell your shares.
We are offering to purchase up to $1,000,000,000 in value of shares, upon the terms and subject to the conditions of the tender offer, at a Purchase Price (to be determined as provided herein) of not less than $13.10 per share and not more than $15.00 per share, without interest, for each share we purchase pursuant to the tender offer. Applicable withholding taxes will be deducted from payments to tendering holders. We will determine the Purchase Price as promptly as practicable, but likely not earlier than three to five business days, after the tender offer expires (so that we may determine the number of shares properly tendered, including shares tendered by guaranteed delivery procedures, as described in Section 3, and not properly withdrawn). We will select the lowest Purchase Price, which will not be less than $13.10 per share and not more than $15.00 per share, that will allow us to purchase up to $1,000,000,000 in value of shares, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. Upon the terms and subject to the conditions of the tender offer, if shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn prior to the Expiration Date, we will buy all shares properly tendered at prices at or below the Purchase Price and not properly withdrawn. See Section 1.
If you wish to maximize the chance that your shares will be purchased in the tender offer, you should check the box in the section of the Letter of Transmittal captioned “Shares Tendered at Price Determined Pursuant to the Tender Offer.” Note that this election will mean that your shares will be deemed to be tendered at the minimum price of $13.10 per share. You should understand, however, that this election may lower the Purchase Price paid for all purchased shares in the tender offer and could result in your shares being purchased at the minimum price of $13.10 per share, a price that is below the closing price for the shares on February 1, 2021, the last full trading day before announcement and commencement of the tender offer, when the NASDAQ closing price was $13.78, and could be below the closing price of our common stock on the Expiration Date.
What will be the form of payment of the Purchase Price?
If your shares are purchased in the tender offer, you will be paid the Purchase Price in cash, without interest, for each of your shares that we purchase pursuant to the tender offer. Applicable withholding taxes will be deducted from payments to tendering holders. We will pay the Purchase Price promptly after the expiration of the tender offer period, but do not expect to begin making such payments until at least three to five business days following the Expiration Date (so that we may determine the number of shares properly tendered, including shares tendered by guaranteed delivery procedures, as described in Section 3, and not properly withdrawn). See Section 5.
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How many shares will the Company purchase?
Subject to the conditions of the tender offer being satisfied or waived, we will purchase a number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares of common stock properly tendered and not properly withdrawn pursuant to the tender offer. Upon the terms and subject to the conditions of the tender offer, if shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn prior to the Expiration Date, we will buy all shares properly tendered at prices at or below the Purchase Price and not properly withdrawn.
As of January 27, 2021, we had 375,914,746 issued and outstanding shares (and 6,142,800 shares reserved for issuance upon exercise of Stock Options and vesting of RSUs and PSUs (assuming PSUs vest at the specified target performance threshold)). Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $15.00, the maximum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 66,666,666 shares, which would represent approximately 17.73% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 17.45% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares). If the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $13.10, the minimum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 76,335,877 shares, which would represent approximately 20.31% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 19.98% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares).
In addition, if shares having an aggregate purchase price of more than $1,000,000,000 are tendered in the tender offer and not properly withdrawn, we reserve the right to accept for purchase at the Purchase Price pursuant to the tender offer up to an additional 2% of our outstanding shares without amending or extending the tender offer. We also expressly reserve the right, in our sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements. See Section 1.
The tender offer is not conditioned on any minimum number of shares being tendered. The tender offer is, however, subject to other conditions. See Section 7.
How will the Company pay for the shares?
The Company will fund the tender offer with cash on hand. The tender offer is not conditioned upon the receipt of financing, although it is subject to certain other conditions. See Section 7.
Assuming the tender offer is fully subscribed, and assuming we do not exercise our right to purchase up to an additional 2% of our outstanding shares, we expect the aggregate cost of the purchases, including all fees and expenses related to the tender offer, to be approximately $1,003,400,000.
How long do I have to tender my shares?
You may tender your shares until the Expiration Date. The Expiration Date is at 12:00 midnight, New York City time, at the end of the day on March 2, 2021, unless we extend or withdraw the tender offer. We may choose to extend the tender offer at any time and for any reason. We cannot assure you that the tender offer will be extended or, if extended, for how long. See Section 1 and Section 14. If a broker, dealer, commercial bank, trust company or other nominee holds your shares, it is likely that, for administrative reasons, such nominee has an earlier deadline that must be met for your shares to be tendered by the Expiration Date. Accordingly, beneficial owners wishing to participate in the tender offer should contact their broker, dealer, commercial bank, trust company or other nominee as soon as possible in order to determine the times by which such owner must take action in order to participate in the tender offer.
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Can the tender offer be extended, amended or terminated, and under what circumstances?
We can extend or amend the tender offer in our sole discretion. If we extend the tender offer, we will delay the acceptance of any shares that have been tendered. We can terminate the tender offer under certain circumstances. See Section 7 and Section 14.
How will I be notified if the Company extends the tender offer or amends the terms of the tender offer?
We will issue a press release no later than 9:00 a.m., New York City time, on the business day after the previously scheduled Expiration Date if we decide to extend the tender offer. We will announce any amendment to the tender offer by making a public announcement of the amendment. In the event that the terms of the tender offer are amended, we will file with the Commission an amendment to our Tender Offer Statement on Schedule TO-I relating to the tender offer describing the amendment. See Section 14.
What is the purpose of the tender offer?
Our Board of Directors determined that it is in the best interests of the Company to repurchase shares of its common stock and that at this time the tender offer described in this Offer to Purchase is a prudent and effective way to do so and to provide value and increased liquidity to our stockholders. In particular, our Board of Directors believes the modified “Dutch auction” tender offer set forth in this Offer to Purchase is a mechanism that will provide all stockholders with the opportunity to tender all or a portion of their shares (subject to any proration and the other terms of this Offer to Purchase). Conversely, the tender offer also affords stockholders the option not to participate and, thereby, to increase their relative percentage interest in the Company and its future results. The Board of Directors considered the likely effect that repurchasing shares of our common stock would have on our capital ratios, and we believe such capital ratios will continue to support organic growth and other strategic options. In addition, our Board of Directors believes the tender offer provides stockholders with an opportunity to obtain liquidity with respect to all or a portion of their shares (subject to any proration and the other terms of this Offer to Purchase), without potential disruption to the share price and the usual transaction costs inherent in open market purchases and sales. See Section 2.
Will I be entitled to dividends if I tender my shares?
On January 27, 2021, the Company announced a quarterly dividend of $0.03 per share of common stock, payable on March 15, 2021 to stockholders of record at the close of business on March 5, 2021. The dividend will be paid to stockholders of record at the close of business on March 5, 2021 regardless of whether such stockholder tenders its shares in the tender offer.
Are there any conditions to the tender offer?
Yes. Our obligation to accept and pay for your tendered shares depends on a number of conditions, including:
| • | No legal action shall have been threatened, instituted or pending that challenges or relates to the tender offer or that, in our reasonable judgment, could materially and adversely affect our business, condition (financial or otherwise), assets, income, operations or prospects or otherwise materially impair the contemplated future conduct of our business or our ability to purchase shares in the tender offer; |
| • | No general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the over-the-counter markets in the United States or the declaration of a banking moratorium or any suspension of payment in respect of banks in the United States shall have occurred; |
| • | No commencement or escalation of war, armed hostilities or other international or national calamity, including, but not limited to, an act of terrorism, directly or indirectly involving the United States shall have occurred on or after February 1, 2021, the last trading day prior to the commencement of the tender offer; |
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| • | No changes in the general political, public health (including with respect the impact of the COVID-19 pandemic), market, economic or financial conditions in the United States or abroad that, in our reasonable judgment, could materially and adversely affect our business, condition (financial or otherwise), assets, income, operations or prospects; |
| • | No decrease of more than 10% in the market price for our common stock or in the Dow Jones Industrial Average, New York Stock Exchange Index, NASDAQ Composite Index or the Standard and Poor’s 500 Composite Index measured from the close of business on February 1, 2021 shall have occurred; |
| • | No limitation, whether or not mandatory, by any governmental, regulatory or administrative agency or authority on, or event that could reasonably be expected to materially affect, the extension of credit by banks or other lending institutions in the United States shall have occurred; |
| • | Any necessary regulatory approvals or non-objections shall have been obtained and shall remain in full force and effect; |
| • | No tender or exchange offer for any or all of our shares, or any merger, acquisition, business combination or other similar transaction with or involving us or any of our subsidiaries, shall have been proposed, announced or made by any person or shall have been publicly disclosed since February 1, 2021, and we shall not have entered into a definitive agreement or an agreement in principle with any person with respect to a merger, acquisition, business combination or other similar transaction, other than in the ordinary course of business (in each case other than the tender offer) since February 1, 2021; |
| • | No change in law or in the official interpretation or administration of law, or relevant position or policy of a governmental authority with respect to any laws, applicable to the tender offer; |
| • | The consummation of the tender offer and the purchase of shares will not cause the shares to cease to be listed on the NASDAQ or cause the shares to be subject to deregistration under the Exchange Act; |
| • | No person (including a group) shall have acquired, or proposed to acquire, beneficial ownership of more than 5% of the outstanding shares (other than as publicly disclosed in a filing with the Commission on or before February 1, 2021) nor shall any new group have been formed that beneficially owns more than 5% of the outstanding shares; |
| • | No person (including a group) that has publicly disclosed in a filing with the Commission on or before February 1, 2021 that it has beneficial ownership of more than 5% of the outstanding shares shall have acquired, or publicly announced its proposal to acquire, beneficial ownership of an additional 1% or more of the outstanding shares; and |
| • | No person shall have filed a Notification and Report Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, or made a public announcement reflecting an intent to acquire us or any of our subsidiaries or any of our assets or securities. |
The tender offer is not conditioned upon the receipt of financing or any minimum number of shares being tendered.
These conditions are described in greater detail in Section 7. In addition, the tender offer is subject to a number of other conditions described in Section 7.
How do I tender my shares?
To tender your shares, prior to 12:00 midnight, New York City time, at the end of the day on March 2, 2021, or any later time and date to which the tender offer may be extended:
| • | if your shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, contact such nominee and have such nominee tender your shares for you; |
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| • | if you are an institution participating in The Depository Trust Company, referred to as “DTC” or the “Book-Entry Transfer Facility,” tender your shares according to the procedure for book-entry transfer described in Section 3; or |
| • | if you hold certificates or book-entry shares in your own name, complete and sign a Letter of Transmittal according to its instructions and deliver it, together with any required signature guarantees, the certificates for your shares and any other documents required by the Letter of Transmittal, to the Depositary at its address shown on the Letter of Transmittal. |
Beneficial owners should be aware that their broker, dealer, commercial bank, trust company or other nominee may establish its own earlier deadline for participation in the tender offer. Accordingly, beneficial owners wishing to participate in the tender offer should contact their broker, dealer, commercial bank, trust company or other nominee as soon as possible in order to determine the times by which such owner must take action in order to participate in the tender offer.
If you want to tender your shares, but your certificates for the shares are not immediately available or cannot be delivered to the Depositary, you cannot comply with the procedure for book-entry transfer or you cannot deliver the other required documents to the Depositary by the Expiration Date of the tender offer, you may still tender your shares if you comply with the guaranteed delivery procedure described in Section 3.
In accordance with Instructions 4 and 5 to the Letter of Transmittal, each stockholder who is not tendering through DTC and who desires to tender shares in the tender offer must either check (1) one, and only one, of the boxes in the section of the Letter of Transmittal captioned “Shares Tendered at Price Determined by Stockholder,” indicating the price (in increments of $0.10) at which shares are being tendered, or (2) the box in the section of the Letter of Transmittal captioned “Shares Tendered at Price Determined Pursuant to the Tender Offer,” in which case you will be deemed to have tendered your shares at the minimum price of $13.10 per share (YOU SHOULD UNDERSTAND THAT THIS ELECTION MAY CAUSE THE PURCHASE PRICE TO BE LOWER AND COULD RESULT IN THE TENDERED SHARES BEING PURCHASED AT THE MINIMUM PRICE OF $13.10 PER SHARE, A PRICE THAT IS BELOW THE CLOSING PRICE FOR THE SHARES ON FEBRUARY 1, 2021, THE LAST FULL TRADING DAY BEFORE ANNOUNCEMENT AND COMMENCEMENT OF THE TENDER OFFER AND COULD BE BELOW THE CLOSING PRICE OF OUR COMMON STOCK ON THE EXPIRATION DATE).
If tendering stockholders wish to maximize the chance that their shares will be purchased, they should check the box in the section of the Letter of Transmittal captioned “Shares Tendered at Price Determined Pursuant to the Tender Offer.” Shares tendered pursuant to Purchase Price tenders will be deemed to have been tendered at a price of $13.10 per share (which is the minimum price per share under the tender offer) for purposes of determining the Purchase Price. Accordingly, Purchase Price tenders could lower the Purchase Price and could result in your shares being purchased at the minimum price of $13.10 per share, a price that is below the closing price for the shares on February 1, 2021, the last full trading day before announcement and commencement of the tender offer and could be below the closing price of our common stock on the Expiration Date. See Section 8 for recent market prices for shares of our common stock.
If I am a holder of vested Stock Options, how do I participate in the tender offer?
We are not offering, as part of the tender offer, to purchase any outstanding Stock Options, and tenders of Stock Options will not be accepted. If you are a holder of vested Stock Options, you may exercise your vested Stock Options and tender any shares issued upon such exercise. You must exercise your Stock Options in a timely manner prior to the Expiration Date in order to have time for such exercise to settle before the shares received upon exercise of the options may be tendered. An exercise of Stock Options cannot be revoked even if shares received upon the exercise and tendered in the Offer are not purchased in the tender offer for any reason. We urge each shareholder to consult with his or her financial advisor or tax advisor with respect to the advisability of exercising any vested Stock Options and tendering any shares issued upon such exercise.
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If I am a holder of RSUs or PSUs, how do I participate in the tender offer?
We are not offering, as part of the tender offer, to purchase any outstanding RSUs or PSUs, and tenders of RSUs and PSUs will not be accepted. Holders of RSUs and PSUs may not tender shares represented by such interests unless the awards are fully vested and settled in shares prior to the Expiration Date.
How will the tender offer affect the number of our shares outstanding and the number of record holders?
As of January 27, 2021, we had 375,914,746 issued and outstanding shares (and 6,142,800 shares reserved for issuance upon exercise of Stock Options and vesting of RSUs and PSUs (assuming PSUs vest at the specified target performance threshold)). Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $15.00, the maximum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 66,666,666 shares, which would represent approximately 17.73% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 17.45% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares). If the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $13.10, the minimum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 76,335,877 shares, which would represent approximately 20.31% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 19.98% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares).
In addition, if shares having an aggregate purchase price of more than $1,000,000,000 are tendered in the tender offer and not properly withdrawn, we reserve the right to accept for purchase at the Purchase Price pursuant to the tender offer up to an additional 2% of our outstanding shares without amending or extending the tender offer. We also expressly reserve the right, in our sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements. See Section 1.
Furthermore, if any of our stockholders:
| • | who hold shares in their own name as holders of record; or |
| • | who are “registered holders” as participants in DTC’s system whose names appear on a security position listing, |
tender their shares in full and that tender is accepted in full, then the number of our record holders would be reduced. See Section 2.
Stockholders who do not have their shares purchased in the tender offer will realize a proportionate increase in their relative ownership interest in the Company following the purchase of shares pursuant to the tender offer. See Section 2.
We currently intend to cancel and retire shares purchased pursuant to the tender offer. Such shares will return to the status of authorized and unissued shares and will be available for us to issue without further stockholder action for all purposes except as required by applicable law and regulation or the rules of the NASDAQ. We have no current plans for the issuance of shares purchased in this tender offer.
Following the tender offer, will the Company continue as a public company?
Yes. In addition, the tender offer is conditioned upon the Company having determined that the transaction will not cause the Company to be delisted from the NASDAQ and will not cause the shares to be subject to deregistration under the Exchange Act (which would result in the Company ceasing to be subject to the periodic reporting requirements of the Exchange Act). See Section 2.
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May I tender only a portion of the shares that I hold?
Yes. You do not have to tender all of the shares that you own to participate in the tender offer.
If I own fewer than 100 shares and I tender all of my shares, will I be subject to proration?
If you own, beneficially or of record, fewer than an aggregate of 100 shares, you properly tender all of such shares at or below the Purchase Price prior to the Expiration Date (and do not properly withdraw such shares) and you complete the section entitled “Odd Lots” in the Letter of Transmittal and, if applicable, in the Notice of Guaranteed Delivery, and all conditions to the tender offer are satisfied or waived, we will purchase all of your shares without subjecting them to proration. See Section 1.
Can I change my mind after I have tendered shares in the tender offer, but before the Expiration Date?
Yes. You may withdraw any shares you have tendered at any time before the Expiration Date, which will occur at 12:00 midnight, New York City time, at the end of the day on March 2, 2021, unless we extend or withdraw the tender offer. If we have not accepted for payment the shares you have tendered to us by 12:00 midnight, New York City time, at the end of the day on March 30, 2021 (the 40th business day from the commencement of the tender offer), you may also withdraw your shares at that time. See Section 4.
If you hold interests in shares through a broker, you must follow the broker’s procedures described in instructions that you will receive, which may include an earlier deadline for notifying the broker of your desire to withdraw your shares.
How do I withdraw shares I previously tendered?
You must deliver on a timely basis a written notice of your withdrawal to the Depositary at the address appearing on the back cover of this Offer to Purchase. Your notice of withdrawal must specify your name, the number of shares to be withdrawn and the name of the registered holder of such shares. Additional requirements will apply if the certificates for shares to be withdrawn have been delivered to the Depositary or if your shares have been tendered under the procedure for book-entry transfer set forth in Section 3. See Section 4.
In what order will the Company purchase the tendered shares?
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn prior to the Expiration Date, we will buy all shares properly tendered at prices at or below the Purchase Price and not properly withdrawn.
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price in excess of $1,000,000,000, measured at the maximum price at which such shares were properly tendered, have been properly tendered and not properly withdrawn prior to the Expiration Date, we will purchase shares:
| • | first, from all stockholders of “odd lots” (persons who own fewer than 100 shares) who properly tender all of their shares at or below the Purchase Price and do not properly withdraw them prior to the Expiration Date; |
| • | second, on a pro rata basis (with appropriate adjustments to avoid the purchase of fractional shares) from all other stockholders who properly tender shares at or below the Purchase Price and do not properly withdraw them before the expiration of the tender offer, other than stockholders who tender conditionally and whose conditions are not satisfied; and |
| • | third, if necessary to permit us to purchase shares having an aggregate purchase price of $1,000,000,000 (or such greater amount as we may elect to purchase, subject to applicable law), from holders who have tendered shares at or below the Purchase Price conditionally (for which the condition |
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| was not initially satisfied) by random lot, to the extent feasible. To be eligible for purchase by random lot, holders whose shares are conditionally tendered must have properly tendered all of their shares and not properly withdrawn them prior to the Expiration Date. |
Therefore, it is possible that we will not purchase any or all of the shares that you tender. See Section 1.
Shares not purchased in the tender offer will be returned to the tendering stockholders at our expense promptly after the expiration of the tender offer.
Has the Company or its Board of Directors adopted a position on the tender offer?
While our Board of Directors has authorized the tender offer, it has not made, nor have the Company, the Dealer Managers, the Information Agent, the Depositary or any of their respective affiliates made, any recommendation to you as to whether you should tender or refrain from tendering your shares or as to the price or prices at which you should tender your shares.
We cannot predict how our common stock will trade after expiration of the tender offer, and it is possible that our common stock price will trade above the tender offer price after expiration of the tender offer. You must make your own decision as to whether to tender your shares and, if so, how many shares to tender and the price or prices at which you choose to tender your shares. In doing so, you should read carefully all of the information in, or incorporated by reference in, this Offer to Purchase, in the related Letter of Transmittal and in the other tender offer materials. You are urged to discuss these matters with your own tax advisor, financial advisor and/or broker.
Will the Company’s directors and executive officers tender shares in the tender offer?
The Company’s directors and executive officers have informed the Company that they will not tender any of their shares in the tender offer. Assuming the completion of the tender offer, the relative ownership interest of our directors and executive officers in the Company will increase. See Section 11.
If I decide not to tender, how will the tender offer affect my shares?
Stockholders who choose not to tender will own a greater percentage interest in our outstanding common stock following the completion of the tender offer.
What is the accounting treatment of the tender offer?
The accounting for the purchase of shares pursuant to the tender offer will result in a reduction of our stockholders’ equity in an amount equal to the aggregate Purchase Price of the shares we purchase plus transaction fees and a corresponding reduction in cash and cash equivalents. See Section 2.
When and how will the Company pay for the shares I tender?
Promptly after the Expiration Date, we will pay the Purchase Price, without interest, for the shares we purchase. Applicable withholding taxes will be deducted from payments to tendering holders. We will announce the preliminary results of the tender offer, including the Purchase Price and preliminary information about any expected proration, on the business day following the Expiration Date. We expect that we will be able to announce the final proration factor and commence payment for any shares purchased pursuant to the tender offer between three to five business days after the Expiration Date, after we have determined the number of shares properly tendered, including shares tendered by guaranteed delivery procedures, as described in Section 3, and not properly withdrawn. We will pay for the shares accepted for purchase by depositing the aggregate Purchase Price with the Depositary promptly after determination of the final proration factor. The Depositary will transmit to you the payment for all of your shares accepted for payment. See Section 5.
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What is a recent market price for the shares?
On February 1, 2021, the last trading day prior to the commencement by the Company of the tender offer, the closing price of the shares on the NASDAQ was $13.78 per share. You are urged to obtain current market quotations for the shares. See Section 8.
Will I have to pay brokerage fees and commissions if I tender my shares?
If you are a holder of record of your shares and you tender your shares directly to the Depositary, you will not incur any brokerage fees or commissions. If you hold your shares through a broker, dealer, commercial bank, trust company or other nominee and such nominee tenders shares on your behalf, such nominee may charge you a fee for doing so. We urge you to consult your broker or other nominee to determine whether any charges will apply. See Sections 5 and 15.
Does the Company intend to repurchase any shares other than pursuant to the tender offer during or after the tender offer?
Rule 13e-4of the Exchange Act generally prohibits us and our affiliates from purchasing any shares, other than pursuant to the tender offer, until the expiration of at least ten business days after the Expiration Date of the tender offer. Beginning on the eleventh business day after the Expiration Date of the tender offer, we may make stock repurchases from time to time on the open market and/or in private transactions. On January 26, 2021, our Board of Directors authorized the repurchase of shares of our common stock, from time to time over the next 24 months, in transactions that may include, without limitation, tender offers, open market purchases, repurchases effected though 10b5-1 trading plans, negotiated block purchases, accelerated share repurchase programs, or other similar transactions, in an aggregate amount not to exceed $1.25 billion. Whether we make additional repurchases will depend on many factors, including, without limitation, the number of shares, if any, that we purchase in this tender offer, our business and financial performance and situation, the business and market conditions at the time, including the price of the shares, and such other factors as we may consider relevant. Any of these repurchases may be on the same terms or on terms that are more or less favorable to the selling stockholders in those transactions than the terms of the tender offer.
What are the U.S. federal income tax consequences if I tender my shares?
The receipt of cash for your tendered shares generally will be treated for U.S. federal income tax purposes either as (1) consideration received in a sale or exchange of the tendered shares or (2) a distribution in respect of your shares. If you are a U.S. Holder (as defined in Section 13), generally, you will be subject to U.S. federal income taxation upon the receipt of cash in exchange for the shares that you tender. See Section 13 for additional information.
If you are a Non-U.S. Holder addressed in Section 13, if the receipt of cash by you is treated as consideration received in a sale or exchange, and such consideration is not effectively connected with your conduct of a trade or business in the United States, you generally will not be subject to U.S. federal income taxation on the receipt of such cash, subject to certain exceptions. However, if the receipt of cash is treated as a distribution with respect to your shares, you may be subject to U.S. federal withholding tax on the portion of such distribution treated as a “dividend” for U.S. federal income tax purposes at a rate of 30% (or such lower rate as may be specified pursuant to an applicable income tax treaty). The treatment of the receipt of cash may depend upon facts that are unique to each stockholder. See Section 13. Thus, if you are a Non-U.S. Holder, it would be prudent to expect that the Depositary or other applicable withholding agent generally will withhold U.S. federal withholding tax at a rate of 30% from any payments made to you pursuant to the tender offer unless such withholding agent receives documentation pursuant to which it may determine that a reduced rate of, or exemption from, such withholding applies. See Sections 3 and 13. If such tax has been withheld but the receipt of
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cash for your tendered shares is in fact properly treated as consideration received in a sale or exchange, then you may apply for a refund of such withheld amount. See Section 13 for additional information.
We recommend that you consult your own tax advisor regarding the particular tax consequences to you of tendering shares for cash pursuant to the tender offer, including the applicability and effect of any U.S. federal, state or local tax laws or any non-U.S. tax laws. See Sections 3 and 13.
Will I have to pay stock transfer tax if I tender my shares?
Except as otherwise provided herein and in the Letter of Transmittal, if you instruct the Depositary in the Letter of Transmittal to make the payment for the tendered shares to the registered holder, you will generally not be required to pay any stock transfer taxes on our purchase of the shares pursuant to the tender offer. See Section 5.
To whom can I talk if I have questions?
The Information Agent can help answer your questions. The Information Agent for the tender offer is D.F. King & Co., Inc. Please call (800) 509-1312 Monday through Friday from 10:00 a.m. to 4:00 p.m. New York City time.
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Attention: Corporate Actions
Banks and Brokers call: (212) 269-5550
or
Call Toll-Free: (877) 283-0322
Email: slm@dfking.com
In addition, the Dealer Managers can help answer your questions, and may be contacted as follows:
| J.P. Morgan Securities LLC | Goldman Sachs & Co. LLC | |
| 383 Madison Ave, 6th Floor New York, NY 10179 U.S. Toll Free: (877) 371-5947 |
200 West Street New York, New York 10282 Attn: Equity Derivatives Group Collect: (800) 323-5678 Toll-Free: (212) 902-1000 | |
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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
This Offer to Purchase and the documents incorporated herein by reference contain “forward-looking statements.” Any statements in this Offer to Purchase or the documents incorporated herein by reference about the Company’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions, or future events or performance are not historical facts and may be forward- looking and reflect the current beliefs and expectations of the Company’s management. These statements are often, but not always, made through the use of words or phrases such as “anticipates,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends,” and similar words or phrases. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, these statements are not guarantees of future performance and involve risks and uncertainties which are subject to change based on various important factors, some of which are beyond the Company’s control. Certain factors that could cause actual results to differ include, among others:
| • | the societal, business, and legislative/regulatory impact of pandemics and other public heath crises; |
| • | increases in financing costs; |
| • | limits on liquidity; |
| • | increases in costs associated with compliance with laws and regulations; |
| • | failure to comply with consumer protection, banking, and other laws; |
| • | changes in accounting standards and the impact of related changes in significant accounting estimates, including any regarding the measurement of our allowance for credit losses and the related provision expense; |
| • | any adverse outcomes in any significant litigation to which we are a party; |
| • | credit risk associated with our exposure to third-parties, including counterparties to our derivative transactions; |
| • | changes in the terms of education loans and the educational credit marketplace (including changes resulting from new laws and the implementation of existing laws); |
| • | changes in our funding costs and availability; |
| • | reductions to our credit ratings; |
| • | cybersecurity incidents, cyberattacks, and other failures or breaches of our operating systems or infrastructure, including those of third-party vendors; |
| • | damage to our reputation; |
| • | risks associated with restructuring initiatives, including failures to successfully implement cost-cutting programs and the adverse effects of such initiatives on our business; |
| • | changes in the demand for educational financing or in financing preferences of lenders, educational institutions, students, and their families; |
| • | changes in law and regulations with respect to the student lending business and financial institutions generally; |
| • | changes in banking rules and regulations, including increased capital requirements; |
| • | increased competition from banks and other consumer lenders; |
| • | the creditworthiness of our customers; |
| • | changes in the general interest rate environment, including the rate relationships among relevant money-market instruments and those of our earning assets versus our funding arrangements; |
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| • | rates of prepayment on the loans that we own; |
| • | changes in general economic conditions and our ability to successfully effectuate any acquisitions, and other strategic initiatives. |
If one or more of the factors affecting the Company’s forward-looking information and statements renders forward-looking information or statements incorrect, the Company’s actual results, performance or achievements could differ materially from those expressed in, or implied by, forward- looking information and statements. Therefore, the Company cautions the reader not to place undue reliance on any forward-looking information or statements. The effect of these factors is difficult to predict. Factors other than these also could adversely affect the Company’s results, and the reader should not consider these factors to be a complete set of all potential risks or uncertainties as new factors emerge from time to time. Management cannot assess the impact of any such factor on the Company’s business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Any forward-looking statements only speak as of the date of this document, and the Company undertakes no obligation to update any forward-looking information or statements, whether written or oral, to reflect any change, except as required by law. All forward-looking statements attributable to the Company are expressly qualified by these cautionary statements.
For a more detailed discussion of these and other factors that may affect our business and that could cause the actual results to differ materially from those anticipated in these forward-looking statements, see our periodic filings incorporated herein by reference.
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To the Holders of Our Common Stock:
SLM Corporation, a Delaware corporation, hereby offers to purchase for cash up to $1,000,000,000 in value of shares of its issued and outstanding common stock, par value $0.20 per share, upon the terms and subject to the conditions set forth in this Offer to Purchase, the related Letter of Transmittal and the other tender offer materials. We are offering to purchase the shares at a single per share price not less than $13.10 per share and not more than $15.00 per share (the price as determined as provided herein, the “Purchase Price”), without interest. Applicable withholding taxes will be deducted from payments to tendering holders. Tendering shareholders may specify a price not less than $13.10 per share and not more than $15.00 per share (in increments of $0.10) at which they are willing to sell their shares pursuant to the tender offer.
The tender offer will expire at 12:00 midnight, New York City time, at the end of the day on March 2, 2021 (such date and time, as the same may be extended, the “Expiration Date”), unless extended or earlier terminated. We may, in our sole discretion, extend the period of time in which the tender offer will remain open or terminate the tender offer.
Upon the terms and subject to the conditions of this Offer to Purchase, including the provisions relating to “odd lot” priority, proration and conditional tenders described in this Offer to Purchase, we will determine a single Purchase Price that we will pay for shares properly tendered and not properly withdrawn from the tender offer, taking into account the total number of shares tendered and the prices specified by tendering stockholders. We will select the lowest Purchase Price, not less than $13.10 per share and not more than $15.00 per share, that will allow us to purchase that number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. Upon the terms and subject to the conditions of the tender offer, if shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered at or below the Purchase Price and not properly withdrawn prior to the Expiration Date, we will buy all shares properly tendered at or below the Purchase Price and not properly withdrawn.
All shares acquired in the tender offer will be acquired at the same Purchase Price regardless of whether the stockholder tendered at a lower price, and we will only purchase shares tendered at prices equal to or below the Purchase Price. Upon the terms and subject to the conditions of this Offer to Purchase, including the provisions relating to “odd lot” priority, proration and conditional tender provisions described in this Offer to Purchase, the Company will purchase all shares properly tendered at prices at or below the Purchase Price and not properly withdrawn. Shares not purchased in the tender offer will be returned to the tendering stockholders at our expense promptly after the expiration of the tender offer. See Section 1. In addition, if shares with an aggregate purchase price of more than $1,000,000,000 are tendered in the tender offer and not properly withdrawn, we reserve the right to accept for purchase at the Purchase Price pursuant to the tender offer up to an additional 2% of our outstanding shares without amending or extending the tender offer. We also expressly reserve the right, in our sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements. See Section 1.
If completed, the tender offer will provide stockholders with an opportunity to obtain liquidity with respect to all or a portion of their shares, without potential disruption to the share price and the usual transaction costs inherent in open market purchases and sales. The tender offer also affords stockholders the option not to participate and, thereby, to increase their relative percentage ownership interest in the Company and its future results.
WHILE OUR BOARD OF DIRECTORS HAS AUTHORIZED THE TENDER OFFER, IT HAS NOT MADE, NOR HAVE THE COMPANY, THE DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY OR ANY OF OUR OR THEIR RESPECTIVE AFFILIATES MADE, ANY
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RECOMMENDATION TO YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES OR AT WHAT PRICE OR PRICES YOU CHOOSE TO TENDER YOUR SHARES. YOU MUST MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR SHARES AND, IF SO, HOW MANY SHARES TO TENDER OR AT WHAT PRICE OR PRICES YOU CHOOSE TO TENDER YOUR SHARES. IN SO DOING, YOU SHOULD READ CAREFULLY ALL OF THE INFORMATION IN, OR INCORPORATED BY REFERENCE IN, THIS OFFER TO PURCHASE, THE RELATED LETTER OF TRANSMITTAL AND THE OTHER TENDER OFFER MATERIALS, INCLUDING OUR REASONS FOR MAKING THE TENDER OFFER. SEE SECTION 2. THE COMPANY’S BOARD OF DIRECTORS AND EXECUTIVE OFFICERS WILL NOT TENDER ANY OF THEIR SHARES IN THE TENDER OFFER. SEE SECTION 11. YOU ARE URGED TO DISCUSS THESE MATTERS WITH YOUR OWN TAX ADVISOR, FINANCIAL ADVISOR AND/OR BROKER.
We expressly reserve the right, in our sole discretion, to change the per share purchase price range and to increase or decrease the value of shares sought in the tender offer, subject to applicable law. We may increase the value of shares sought in the tender offer to an amount greater than $1,000,000,000, subject to applicable law. See Section 14.
The tender offer is not conditioned upon the receipt of financing or any minimum number of shares being tendered. The tender offer is, however, subject to certain conditions. See Section 7.
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered at or below the Purchase Price and not properly withdrawn prior to the Expiration Date, we will buy all shares properly tendered at or below the Purchase Price and not properly withdrawn.
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price in excess of $1,000,000,000, measured at the maximum price at which such shares were properly tendered, have been properly tendered and not properly withdrawn prior to the Expiration Date, we will buy shares in the following order of priority:
| • | first, from all holders of “odd lots” (holders of fewer than 100 shares) who properly tender all their shares at or below the Purchase Price and do not properly withdraw them before the Expiration Date; |
| • | second, on a pro rata basis (with appropriate adjustments to avoid the purchase of fractional shares) from all other stockholders who properly tender shares at or below the Purchase Price and do not properly withdraw them prior to the Expiration Date, other than stockholders who tender conditionally and whose conditions are not satisfied; and |
| • | third, if necessary to permit us to purchase shares having an aggregate purchase price of $1,000,000,000 (or such greater amount as we may elect to purchase, subject to applicable law), from stockholders who have tendered shares at or below the Purchase Price subject to the condition that a specified minimum number of the stockholder’s shares be purchased if any of the stockholder’s shares are purchased in the tender offer (for which the condition was not initially satisfied) by random lot, to the extent feasible. To be eligible for purchase by random lot, stockholders whose shares are conditionally tendered must have tendered all of their shares and not properly withdrawn them prior to the Expiration Date. |
Therefore, it is possible that we will not purchase all of the shares tendered pursuant to the tender offer. See Sections 1, 5 and 6, respectively, for additional information concerning priority, proration and conditional tender procedures.
We will pay the Purchase Price, without interest, for all shares purchased. Applicable withholding taxes will be deducted from payments to tendering holders. Tendering stockholders who hold shares registered in their own
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name and who tender their shares directly to the Depositary will not be obligated to pay brokerage commissions, solicitation fees or, except as otherwise provided in Section 5 and the Letter of Transmittal, stock transfer taxes on our purchase of shares pursuant to the tender offer. Stockholders holding shares through brokers, dealers, commercial banks, trust companies or other nominees are urged to consult such nominees to determine whether transaction costs apply. Also, any tendering stockholder or other payee who fails to complete, sign and deliver the Internal Revenue Service (“IRS”) Form W-9 included with the Letter of Transmittal or an applicable IRS Form W-8 may be subject to U.S. federal backup withholding on the gross proceeds paid to the payee pursuant to the tender offer, unless such payee establishes that such payee is within the class of persons that is exempt from backup withholding. See Section 3. Also see Section 13 for a discussion of certain U.S. federal income tax consequences of the tender offer.
Holders of restricted stock, stock options, RSUs and PSUs may not tender shares represented by such interests unless they are fully vested and, if applicable, settled in shares prior to the Expiration Date. Exercises of stock options, once exercised, cannot be revoked even if some or all of the shares received upon the exercise thereof and tendered in the tender offer are not purchased pursuant to the tender offer for any reason. See Sections 3 and 11 for more information.
We will pay the fees and expenses incurred in connection with the tender offer by D.F. King & Co. Inc., the Information Agent for the tender offer, Computershare Trust Company, N.A., the Depositary for the tender offer, and J.P. Morgan Securities LLC and Goldman Sachs & Co. LLC, the Dealer Managers for the tender offer. The Dealer Managers, the Information Agent and the Depositary will each also receive reasonable and customary compensation for their respective services. See Section 15.
As of January 27, 2021, we had 375,914,746 issued and outstanding shares (and 6,142,800 shares reserved for issuance upon exercise of Stock Options and vesting of RSUs and PSUs (assuming PSUs vest at the specified target performance threshold)). Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $15.00, the maximum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 66,666,666 shares, which would represent approximately 17.73% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 17.45% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares). If the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $13.10, the minimum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 76,335,877 shares, which would represent approximately 20.31% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 19.98% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares).
The shares are listed and traded on the NASDAQ. On February 1, 2021, the last trading day prior to the commencement by the Company of the tender offer, the last reported sale price of the shares on the NASDAQ was $13.78 per share. Stockholders are urged to obtain current market quotations for the shares. See Section 8.
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| 1. | Number of Shares; Proration. |
General. Upon the terms and subject to the conditions of the tender offer, we hereby offer to purchase for cash up to $1,000,000,000 in value of shares of our common stock properly tendered and not properly withdrawn in accordance with Section 4 before the Expiration Date of the tender offer, at a Purchase Price determined by us of not less than $13.10 per share and not more than $15.00 per share, without interest. Applicable withholding taxes will be deducted from payments to tendering holders. See Section 14 for a description of our right to extend, delay, terminate or amend the tender offer. We also expressly reserve the right, in our sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements. In addition, if shares having an aggregate purchase price of more than $1,000,000,000 are tendered in the tender offer and not properly withdrawn, we reserve the right to accept for purchase at the Purchase Price pursuant to the tender offer up to an additional 2% of our outstanding shares without amending or extending the tender offer.
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn prior to the Expiration Date, we will buy all shares properly tendered at or below the Purchase Price and not properly withdrawn. If the tender offer is oversubscribed as described below, shares tendered will be subject to proration. The withdrawal rights expire on the Expiration Date.
However, if we:
| • | increase the maximum price to be paid above $15.00 per share or decrease the price to be paid below $13.10 per share or otherwise change the price range at which we are offering to purchase shares in the tender offer; |
| • | increase the aggregate purchase price for shares being sought in the tender offer and such increase would result in the prospective purchase of a number of shares exceeding 2% of our outstanding shares; or |
| • | decrease the aggregate purchase price for shares being sought in the tender offer; and |
the tender offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day (as defined below) from, and including, the date that announcement of any such change is first published, sent or given in the manner specified in Section 14, the tender offer will be extended until a date that is on or after the expiration of such period of ten business days. A “business day” means any day other than a Saturday, Sunday or U.S. federal holiday and consists of the time period from 12:01 a.m. through 12:00 midnight, New York City time.
In accordance with the instructions to the Letter of Transmittal, stockholders desiring to tender shares must specify the price (in increments of $0.10), not less than $13.10 per share and not more than $15.00 per share, at which they are willing to sell their shares to the Company. Alternatively, stockholders desiring to tender shares can choose not to specify a price and, instead, specify that they will sell their shares at the Purchase Price that the Company determines pursuant to the terms of the tender offer, which could be a price per share as low as $13.10 or as high as $15.00. If tendering stockholders wish to maximize the chance that the Company will purchase their shares, they should check the box in the section of the Letter of Transmittal captioned “Shares Tendered at Price Determined Pursuant to the Tender Offer.” Note that this election will mean that such stockholder’s shares will be deemed to be tendered at the minimum price of $13.10 per share. Tendering stockholders who make this election should understand that this election may lower the Purchase Price and could result in such stockholder’s shares being purchased at the minimum price of $13.10 per share, a price that is below the closing price for the shares on February 1, 2021, the last full trading day before announcement and commencement of the tender offer and could be below the closing price of our common stock on the Expiration Date.
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THE TENDER OFFER IS NOT CONDITIONED ON THE RECEIPT OF ANY FINANCING OR ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE TENDER OFFER IS, HOWEVER, SUBJECT TO CERTAIN CONDITIONS. SEE SECTION 7.
All shares tendered and not purchased pursuant to the tender offer, including shares not purchased because they were tendered at a price greater than the Purchase Price or because of proration and conditional tender provisions, will be returned to the tendering stockholders or, in the case of shares delivered by book-entry transfer, credited to the account at the Book-Entry Transfer Facility from which the transfer had previously been made, at our expense promptly following the Expiration Date.
Priority of Purchases. If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered at or below the Purchase Price and not properly withdrawn prior to the Expiration Date, we will purchase all shares properly tendered at or below the Purchase Price and not properly withdrawn.
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price in excess of $1,000,000,000, measured at the maximum price at which such shares were properly tendered, have been properly tendered and not properly withdrawn prior to the Expiration Date, we will purchase properly tendered shares on the basis set forth below:
| • | first, we will purchase all shares tendered by all holders of “odd lots” (as defined below) who: |
| (1) | tender at or below the Purchase Price all shares owned beneficially or of record by such holders (partial tenders will not qualify for this preference); and |
| (2) | complete the section entitled “Odd Lots” in the Letter of Transmittal and, if applicable, the Notice of Guaranteed Delivery; |
| • | second, subject to the conditional tender provisions described in Section 6, we will purchase all other shares tendered at or below the Purchase Price on a pro rata basis with appropriate adjustments to avoid purchases of fractional shares, as described below; and |
| • | third, if necessary to permit us to purchase shares having an aggregate purchase price of $1,000,000,000 (or such greater amount as we may elect to purchase, subject to applicable law), shares conditionally tendered at or below the Purchase Price (for which the condition was not initially satisfied), will, to the extent feasible, be selected for purchase by random lot. To be eligible for purchase by random lot, stockholders whose shares are conditionally tendered must have properly tendered all of their shares and not properly withdrawn them prior to the Expiration Date. |
Therefore, it is possible that we will not purchase any or all of the shares that a holder tenders in the tender offer. It is also possible that none of the shares conditionally tendered will be purchased.
Odd Lots. The term “odd lots” means all shares tendered by any person who owned beneficially or of record a total of fewer than 100 shares and so certified in the appropriate place on the Letter of Transmittal and, if applicable, the Notice of Guaranteed Delivery. To qualify for the odd lot preference, an odd lot holder must tender at or below the Purchase Price all shares owned by such holder in accordance with the procedures described in Section 3. Odd lots will be accepted for payment before any proration of the purchase of other tendered shares. Any odd lot holder wishing to tender all of such stockholder’s shares pursuant to the tender offer must complete the section entitled “Odd Lots” in the Letter of Transmittal and, if applicable, the Notice of Guaranteed Delivery.
Proration. If proration of tendered shares is required, we will determine the proration factor promptly following the Expiration Date. Subject to adjustment to avoid the purchase of fractional shares and subject to conditional tenders described below, proration for each stockholder tendering shares (other than odd lot holder
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and shares conditionally tendered) will be based on the ratio of the number of shares properly tendered at or below the Purchase Price and not properly withdrawn by such stockholder to the total number of shares properly tendered at or below the Purchase Price and not properly withdrawn by all stockholders (other than odd lot holders). The preliminary results of any proration will be announced by press release promptly after the Expiration Date. We expect that we will be able to announce the final proration factor and commence payment for any shares purchased pursuant to the tender offer between three to five business days after the Expiration Date, after we have determined the number of shares properly tendered, including shares tendered by guaranteed delivery procedures, as described in Section 3, and not properly withdrawn. Stockholders may obtain preliminary proration information from the Information Agent and may be able to obtain such information from their brokers.
Conditional Tenders. A stockholder may tender shares subject to the condition that a specified minimum number of the stockholder’s shares tendered pursuant to a Letter of Transmittal must be purchased if any shares tendered are purchased. Any stockholder wishing to make a conditional tender must so indicate in the box entitled “Conditional Tender” in the Letter of Transmittal and indicate the minimum number of shares that must be purchased if any are to be purchased. We urge each stockholder to consult with his, her or its own financial and tax advisors. No assurances can be provided that a conditional tender will achieve the intended U.S. federal income tax result for any tendering stockholder. See Section 6.
As described in Section 13, the number of shares that we will purchase from a stockholder pursuant to the tender offer may affect the U.S. federal income tax consequences to that stockholder and, therefore, may be relevant to a stockholder’s decision whether or not to tender shares and whether or not to condition any tender upon our purchase of a stated number of shares held by such stockholder.
This Offer to Purchase and the related Letter of Transmittal will be mailed to record holders of shares and will be furnished to brokers, dealers, commercial banks, trust companies and other nominees whose names, or the names of whose nominees, appear on our stockholder list or, if applicable, who are listed as participants in a clearing agency’s security position listing for subsequent transmittal to beneficial owners of shares.
| 2. | Purpose of the Tender Offer; Certain Effects of the Tender Offer. |
Purpose of the Tender Offer. Our Board of Directors determined that it is in the best interests of the Company to repurchase shares of its common stock and that at this time the tender offer described in this Offer to Purchase is a prudent and effective way to do so and to provide value and increased liquidity to our stockholders. In particular, our Board of Directors believes the modified “Dutch auction” tender offer set forth in this Offer to Purchase is a mechanism that will provide all stockholders with the opportunity to tender all or a portion of their shares (subject to any proration and the other terms of this Offer to Purchase). Conversely, the tender offer also affords stockholders the option not to participate and, thereby, to increase their relative percentage interest in the Company and its future results. The Board of Directors considered the likely effect that repurchasing shares of our common stock would have on our capital ratios, and we believe such capital ratios will continue to support organic growth and other strategic options. In addition, our Board of Directors believes the tender offer provides stockholders with an opportunity to obtain liquidity with respect to all or a portion of their shares (subject to any proration and the other terms of this Offer to Purchase), without potential disruption to the share price and the usual transaction costs inherent in open market purchases and sales.
The tender offer set forth in this Offer to Purchase will provide all stockholders with the opportunity to elect to tender all or a portion of their shares and thereby receive a return of some or all of their investment if they so elect. The tender offer also affords stockholders the option not to participate and, thereby, to increase their relative percentage ownership interest in the Company and its future results.
While our Board of Directors has authorized the tender offer, it has not made, nor have the Company, the Dealer Managers, the Information Agent, the Depositary or any of our or their respective affiliates made, any recommendation to you as to whether you should tender or refrain from tendering your shares.
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You must make your own decision as to whether to tender your shares and, if so, how many shares to tender and at what price or prices you choose to tender your shares. In doing so, you should read carefully all of the information in this Offer to Purchase, in the related Letter of Transmittal and in the other tender offer materials. The Company has been advised that its directors and executive officers will not tender any of their shares in the tender offer. See Section 11. You are urged to discuss these matters with your own tax advisor, financial advisor and/or broker.
Certain Effects of the Tender Offer. As of January 27, 2021, we had 375,914,746 issued and outstanding shares (and 6,142,800 shares reserved for issuance upon exercise of Stock Options and vesting of RSUs and PSUs (assuming PSUs vest at the specified target performance threshold)). Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $15.00, the maximum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 66,666,666 shares, which would represent approximately 17.73% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 17.45% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares). If the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $13.10, the minimum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 76,335,877 shares, which would represent approximately 20.31% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 19.98% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares).
Stockholders may be able to sell non-tendered shares in the future on NASDAQ or otherwise, at a net price higher or lower than the Purchase Price. We can give no assurance, however, as to the price at which a stockholder may be able to sell such shares in the future.
The tender offer will reduce our “public float,” which is the number of shares owned by non-affiliate stockholders and available for trading in the securities markets, and is likely to reduce the number of our stockholders. These reductions may reduce the volume of trading in our shares and may result in lower stock prices and reduced liquidity in the trading of our shares following completion of the tender offer.
In addition, the tender offer will increase the proportional ownership of our officers and directors who are not participating in the tender offer and any other stockholders who do not participate or participate only in part in the tender offer.
Based on the published guidelines of NASDAQ and the conditions of the tender offer, we do not believe that our purchase of shares pursuant to the tender offer will result in the delisting from the NASDAQ of the remaining shares. The shares are registered under the Exchange Act, which requires, among other things, that we furnish certain information to our stockholders and the Commission and comply with the Commission’s proxy rules in connection with meetings of our stockholders. We believe that our purchase of shares pursuant to the tender offer will not result in the shares becoming eligible for termination of registration under the Exchange Act. The tender offer is conditioned upon the Company having determined that the consummation of the tender offer will not cause the shares to be delisted from the NASDAQ or be eligible for deregistration under the Exchange Act. See Section 7.
We currently intend to cancel and retire shares purchased pursuant to the tender offer. Such shares will return to the status of authorized and unissued shares and will be available for us to issue without further stockholder action for all purposes except as required by applicable law and regulation or the rules of the NASDAQ. We have no current plans for the issuance of shares purchased in this tender offer.
We may, in the future, decide to purchase additional shares. Any such purchases may be on the same terms as, or on terms that are more or less favorable to stockholders than, the terms of the tender offer. Rule 13e-4 under the Exchange Act, however, generally prohibits us and our affiliates from purchasing any shares, other
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than pursuant to the tender offer, until the expiration of at least ten business days after the Expiration Date. On January 26, 2021, our Board of Directors authorized the repurchase of shares of our common stock, from time to time over the next 24 months, in transactions that may include, without limitation, tender offers, open market purchases, repurchases effected though 10b5-1 trading plans, negotiated block purchases, accelerated share repurchase programs, or other similar transactions, in an aggregate amount not to exceed $1.25 billion. Whether we make additional repurchases will depend on many factors, including, without limitation, the number of shares, if any, that we purchase in this tender offer, our business and financial performance and situation, the business and market conditions at the time, including the price of the shares, and such other factors as we may consider relevant. Any of these repurchases may be on the same terms or on terms that are more or less favorable to the selling stockholders in those transactions than the terms of the tender offer.
On January 26, 2021, the Company announced a quarterly dividend of $0.03 per share of common stock, payable on March 15, 2021 to stockholders of record at the close of business on March 5, 2021. The dividend will be paid to stockholders of record at the close of business on March 5, 2021 regardless of whether such stockholder tenders its shares in the tender offer.
Except as otherwise disclosed or incorporated by reference in this Offer to Purchase, including in the Company’s Definitive Proxy Statement on Schedule 14A, we currently have no plans, proposals or negotiations underway that relate to or would result in:
| • | any extraordinary transaction, such as a merger, reorganization or liquidation, involving us or any of our subsidiaries; |
| • | any purchase, sale or transfer of a material amount of our or any of our subsidiaries’ assets; |
| • | any material change in our indebtedness or our capitalization; |
| • | any change in our present Board of Directors or management, including but not limited to any plans or proposals to change the number or the term of directors or to fill any existing vacancies on our Board of Directors or to change any material term of the employment contract of any executive officer; |
| • | any other material change in our corporate structure or business; |
| • | any class of our equity securities ceasing to be authorized to be quoted on the NASDAQ; |
| • | any class of our equity securities becoming eligible for termination of registration under Section 12(g) of the Exchange Act; |
| • | the suspension of our obligation to file reports under Section 15(d) of the Exchange Act; |
| • | the acquisition or disposition by any person of additional securities of the Company, or the disposition of our securities, other than pursuant to our share repurchase program or issuances or grants of, or purchases pursuant to, options and other equity awards granted to directors, officers and employees (including employees of companies we may acquire); or |
| • | any changes in our charter, bylaws or other governing instruments or other actions that could impede the acquisition of control of us. |
Notwithstanding the foregoing, we reserve the right to change our plans and intentions at any time, as we deem appropriate.
| 3. | Procedures for Tendering Shares. |
Proper Tender of Shares. For shares to be tendered properly pursuant to the tender offer:
| • | the certificates for the shares or confirmation of receipt of the shares under the procedure for book-entry transfer set forth below, together with a properly completed and duly executed Letter of Transmittal, including any required signature guarantees, or an Agent’s Message (as defined below) in |
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| the case of a book-entry transfer, and any other documents required by the Letter of Transmittal, must be received prior to 12:00 midnight, New York City time, in each case by the end of the day on the Expiration Date by the Depositary at its address set forth on the back cover page of this document; or |
| • | the tendering stockholder must comply with the guaranteed delivery procedures set forth below. |
Notwithstanding any other provisions hereof, payment for shares tendered and accepted for payment pursuant to the tender offer will be made only after timely receipt by the Depositary of certificates for such shares (or a timely confirmation of a book-entry transfer of such shares into the Depositary’s account at the Book-Entry Transfer Facility), a properly completed and duly executed Letter of Transmittal (or facsimile thereof) with any required signature guarantees, or an Agent’s Message in connection with book-entry delivery, and any other documents required by the Letter of Transmittal.
In accordance with the instructions to the Letter of Transmittal, each stockholder wishing to tender shares in the tender offer must properly indicate in the section captioned (1) “Shares Tendered at Price Determined by Stockholder” in the Letter of Transmittal the price (in increments of $0.10) at which they are tendering shares or (2) “Shares Tendered at Price Determined Pursuant to the Tender Offer” in the Letter of Transmittal that they will accept the Purchase Price determined by us in accordance with the terms of the tender offer.
If tendering stockholders wish to maximize the chance that we will purchase their shares, they should check the box in the section of the Letter of Transmittal captioned “Shares Tendered at Price Determined Pursuant to the Tender Offer.” Note that this election will mean that tendered shares will be deemed to be tendered at the minimum price of $13.10 per share. Tendering stockholders who make this election should understand that this election may lower the Purchase Price and could result in their shares being purchased at the minimum price of $13.10 per share, a price that is below the closing price for the shares on February 1, 2021, the last full trading day before announcement and commencement of the tender offer and could be below the closing price of our common stock on the Expiration Date.
A stockholder who desires to tender shares at more than one price must complete a separate Letter of Transmittal for the different shares and different prices at which such stockholder is tendering shares. In no event may a stockholder tender the same shares at more than one price (unless the shares are first properly withdrawn previously in accordance with Section 4).
STOCKHOLDERS WHO HOLD SHARES THROUGH BROKERS, DEALERS, COMMERCIAL BANKS, TRUST COMPANIES OR OTHER NOMINEES ARE URGED TO CONSULT THEIR BROKERS, DEALERS, COMMERCIAL BANKS, TRUST COMPANIES OR OTHER NOMINEES AS IT IS LIKELY THAT—FOR ADMINISTRATIVE REASONS—SUCH NOMINEES HAVE AN EARLIER DEADLINE FOR YOU TO ACT TO INSTRUCT THEM TO ACCEPT THE TENDER OFFER ON YOUR BEHALF SO THAT THEY CAN MEET THE ABOVE REQUIREMENTS ON A TIMELY BASIS. IN ADDITION, YOU MAY WISH TO DETERMINE WHETHER TRANSACTION COSTS ARE APPLICABLE IF YOU TENDER SHARES THROUGH A BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE.
Odd lot holders who tender all their shares must also complete the section captioned “Odd Lots” in the Letter of Transmittal and, if applicable, the Notice of Guaranteed Delivery, to qualify for the preferential treatment available to odd lot holders as set forth in Section 1.
Book-Entry Delivery. The Depositary has established an account with respect to the shares at The Depository Trust Company (referred to as the “DTC” or the “Book-Entry Transfer Facility”) for purposes of the tender offer, and any financial institution that is a participant in the system of the Book-Entry Transfer Facility may make delivery of shares by causing the Book-Entry Transfer Facility to transfer such shares into the Depositary’s account in accordance with the procedures of the Book-Entry Transfer Facility. However, although
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delivery of shares may be effected through book-entry transfer, a properly completed and duly executed Letter of Transmittal together with any required signature guarantees or an Agent’s Message and any other required documents must, in any case, be received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase by the end of the day on the Expiration Date, or the guaranteed delivery procedures described below must be complied with. Delivery of the Letter of Transmittal and any other required documents to the Company or the Information Agent or any of the Dealer Managers or Book-Entry Transfer Facility does not constitute delivery to the Depositary.
The term “Agent’s Message” means a message transmitted by the Book-Entry Transfer Facility to, and received by, the Depositary and forming a part of the book-entry confirmation, stating that the Book-Entry Transfer Facility has received an express acknowledgment from the participant tendering shares through the Book-Entry Transfer Facility that the participant has received and agrees to be bound by the terms of the Letter of Transmittal and that we may enforce that agreement against that participant.
Method of Delivery. The method of delivery of all documents, including share certificates, is at the election and risk of the tendering stockholder. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. Shares will be deemed delivered only when actually received by the Depositary (including in the case of a book-entry transfer, by book-entry confirmation). In all cases, sufficient time should be allowed to ensure timely delivery.
Signature Guarantees. Except as otherwise provided below, all signatures on a Letter of Transmittal must be guaranteed by a financial institution (including most banks, savings and loans associations and brokerage houses) which is a participant in the Securities Transfer Agents Medallion Program (an “Eligible Institution”). No signature guarantee is required if either: (a) the Letter of Transmittal is signed by the registered holder of the shares exactly as the name of the registered holder appears on the certificate(s) for the shares tendered with the Letter of Transmittal or (b) in the case of book-entry shares, on the records of the Depositary, and payment and delivery are to be made directly to such registered holder and such registered holder has not completed the box entitled “Special Payment Instructions”. If a share certificate is registered in the name of a person other than the person executing a Letter of Transmittal, or if payment is to be made to a person other than the registered holder, then the share certificate must be endorsed or accompanied by an appropriate stock power, in either case signed exactly as the name of the registered holder appears on the certificate, with the signature guaranteed by an Eligible Institution.
Guaranteed Delivery. If a stockholder desires to tender shares pursuant to the tender offer and cannot deliver such shares and all other required documents to the Depositary by the Expiration Date or such stockholder cannot complete the procedure for delivery by book-entry on a timely basis, such shares may nevertheless be tendered if all of the following conditions are met:
| • | such tender is made by or through an Eligible Institution; |
| • | a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form provided by us is received by the Depositary (as provided below) by the end of the day on the Expiration Date; and |
| • | a confirmation of a book-entry transfer of such shares into the Depositary’s account at the Book-Entry Transfer Facility (or any certificates for such shares), together with a properly completed and duly executed Letter of Transmittal with any required signature guarantee or an Agent’s Message and any other documents required by the Letter of Transmittal, are received by the Depositary within two business days after the Expiration Date. |
The Notice of Guaranteed Delivery may be delivered by email or overnight mail to the Depositary and must include a guarantee by an Eligible Institution in the form set forth in such Notice.
Stock Options. We are not offering, as part of the tender offer, to purchase any outstanding Stock Options, and tenders of Stock Options will not be accepted. If you are a holder of vested Stock Options, you may exercise
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your vested Stock Options and tender any shares issued upon such exercise. You must exercise your Stock Options in a timely manner prior to the Expiration Date in order to have time for such exercise to settle before the shares received upon exercise of the options may be tendered. An exercise of Stock Options cannot be revoked even if shares received upon the exercise and tendered in the tender offer are not purchased in the tender offer for any reason.
Restricted Stock Units and Performance Stock Units. We are not offering, as part of the tender offer, to purchase any outstanding RSUs or PSUs, and tenders of RSUs or PSUs will not be accepted. Holders of RSUs and PSUs may not tender shares represented by such interests unless they are fully vested and settled in shares prior to the Expiration Date.
U.S. Federal Backup Withholding. To prevent the potential imposition of U.S. federal backup withholding (currently, at a rate of 24%) on the gross proceeds payable to a tendering beneficial owner pursuant to the tender offer, prior to receiving such payments, each beneficial owner must submit to the Depositary (or other applicable withholding agent) a correct, properly completed and executed IRS Form W-9 (“Form W-9”), in the case of a U.S. Holder (as defined in Section 13), or IRS Form W-8BEN (“Form W-8BEN”), IRS Form W-8BEN-E (“Form W-8BEN-E”), IRS Form W-8IMY (“Form W-8IMY”) or IRS Form W- 8ECI (“Form W-8ECI”), in the case of a Non-U.S. Holder (as defined in Section 13), or otherwise establish an exemption from backup withholding. Form W-9 is included with the Letter of Transmittal and Form W-8BEN, Form W-8BEN-E, Form W-8IMY and Form W-8ECI can be obtained from the IRS website (www.irs.gov). Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be allowed as a credit against the beneficial owner’s U.S. federal income tax liability, if any, and may entitle the beneficial owner to a refund, so long as the required information is timely furnished to the IRS.
Shareholders should consult their own tax advisors regarding the application of backup withholding in their particular circumstances and the availability of, and procedure for obtaining, an exemption from backup withholding.
U.S. Federal Withholding for Non-U.S. Holders. As described in Section 13, the U.S. federal income tax treatment of the receipt of cash in exchange for shares pursuant to the tender offer may depend upon facts that are unique to each Non-U.S. Holder (as defined in Section 13). Accordingly, a Non-U.S. Holder should expect that a withholding agent generally will withhold U.S. federal withholding tax from the gross proceeds payable to a tendering Non-U.S. Holder pursuant to the tender offer at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty), unless an exemption from withholding is applicable because such gross proceeds are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required pursuant to an applicable income tax treaty, are attributable to a permanent establishment maintained by such Non-U.S. Holder in the United States). In order to claim a reduction in the rate of, or an exemption from, such withholding tax, a Non-U.S. Holder must deliver to the applicable withholding agent a correct, properly completed and executed IRS Form W-8BEN or W-8BEN-E (with respect to income tax treaty benefits) or IRS Form W-8ECI (with respect to amounts effectively connected with the conduct by such Non-U.S. Holder of a trade or business within the United States) claiming such reduced rate or exemption. A Non-U.S. Holder may be eligible to obtain a refund of all or a portion of any such tax withheld (i) if such Non-U.S. Holder meets one of the “Section 302 tests” of the Code described in Section 13 or (ii) if such Non-U.S. Holder is otherwise able to establish that no or a reduced amount of tax is due. In addition, as described in Section 13, “FATCA” withholding may apply to amounts paid to a Non-U.S. Holder pursuant to the tender offer unless specified requirements are met.
Non-U.S. Holders should consult their own tax advisors regarding the particular tax consequences to them of selling shares pursuant to the tender offer, including the application of the 30% U.S. federal withholding tax, their potential eligibility for a reduced rate of, or exemption from, such withholding tax, and their potential eligibility for, and procedures for claiming, a refund of any such withholding tax.
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Tender Constitutes an Agreement. The tender of shares pursuant to any one of the procedures described above will constitute the tendering stockholder’s acceptance of the terms and conditions of the tender offer and an agreement between the tendering stockholder and us upon the terms and subject to the conditions of the tender offer, which agreement will be governed by, and construed in accordance, with the laws of the State of New York. In addition, the tender of shares pursuant to any one of the procedures described above will constitute the tendering stockholder’s representation and warranty to us that: (1) the stockholder has a “net long position” in the shares or equivalent securities at least equal to the shares tendered within the meaning of Rule 14e-4 promulgated by the Commission under the Exchange Act; (2) the tender of shares complies with Rule 14e-4 under the Exchange Act; (3) the tendered shares are not currently subject to any contractual or other restriction; and (4) the stockholder has the full power and authority to tender and assign the shares tendered, as specified in the Letter of Transmittal.
It is a violation of Rule 14e-4 under the Exchange Act for a person, directly or indirectly, to tender shares for his or her own account unless the person so tendering (i) has a net long position equal to or greater than the number of (x) shares tendered or (y) other securities immediately convertible into, or exercisable or exchangeable for, the number of shares tendered and will acquire such shares for tender by conversion, exercise or exchange of such other securities and (ii) will cause such shares to be delivered in accordance with the terms of the tender offer. Rule 14e-4 under the Exchange Act provides a similar restriction applicable to the tender or guarantee of a tender on behalf of another person.
Determination of Validity; Rejection of Shares; Waiver of Defects; No Obligation to Give Notice of Defects. We will determine all questions as to the Purchase Price, the form of documents and the validity, eligibility (including time of receipt) and acceptance for payment of any tender of shares, subject to a shareholder’s right to challenge our determination in a court of competent jurisdiction. We reserve the right to reject any or all tenders of shares determined by us not to be in proper form, or the acceptance of which or payment for which may, in the opinion of our counsel, be unlawful, subject to a shareholder’s right to challenge our determination in a court of competent jurisdiction. We also reserve the right to waive any defect or irregularity in any tender of particular shares (without waiving such defect or irregularity with respect to any other shares), subject to a shareholder’s right to challenge our determination in a court of competent jurisdiction. No tender of shares will be deemed to be properly made until all defects and irregularities have been cured or waived. Unless waived, any defects or irregularities in connection with tenders must be cured within such time as we shall determine. None of the Company, the Dealer Managers, the Information Agent, the Depositary, any of their respective affiliates or any other person is or will be under any duty to give notification of any defect or irregularity in tenders or incur any liability for failure to give any such notification.
Return of Unpurchased Shares. If any properly tendered shares are not purchased pursuant to the tender offer or are properly withdrawn before the Expiration Date, or if less than all shares evidenced by a stockholder’s certificates are tendered, certificates for unpurchased shares will be returned promptly after the expiration or termination of the tender offer or the proper withdrawal of the shares, as applicable, or, in the case of shares properly tendered by book-entry transfer at the Book-Entry Transfer Facility, the shares will be credited to the appropriate account maintained by the tendering stockholder at the Book-Entry Transfer Facility, in each case without expense to the stockholder.
Lost, Stolen, Destroyed or Mutilated Certificates. Stockholders whose certificate or certificates for part or all of their shares have been lost, stolen, destroyed or mutilated may contact Computershare Trust Company, N.A., as Transfer Agent for our shares, at 1-877-373-6374. The replacement certificate will then be required to be submitted together with the Letter of Transmittal in order to receive payment for shares that are tendered and accepted for payment. A bond may be required to be posted by the stockholder to secure against the risk that the certificates may be subsequently recirculated. Stockholders are urged to contact the Transfer Agent immediately in order to permit timely processing of this documentation and to determine if the posting of a bond is required.
CERTIFICATES FOR SHARES, TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL OR FACSIMILE THEREOF, OR AN AGENT’S MESSAGE,
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AND ANY OTHER DOCUMENTS REQUIRED BY THE LETTER OF TRANSMITTAL, MUST BE DELIVERED TO THE DEPOSITARY AND NOT TO US OR THE DEALER MANAGERS OR INFORMATION AGENT. ANY SUCH DOCUMENTS DELIVERED TO US OR THE DEALER MANAGERS OR INFORMATION AGENT WILL NOT BE DEEMED TO BE PROPERLY TENDERED.
| 4. | Withdrawal Rights. |
Tenders of shares made pursuant to the tender offer may be withdrawn at any time prior to the Expiration Date. Thereafter, such tenders are irrevocable, except that they may be withdrawn after 12:00 midnight, New York City time, at the end of the day on March 30, 2021, the 40th business day from the commencement of the tender offer, unless theretofore accepted for payment as provided in this Offer to Purchase. If we extend the period of time during which the tender offer is open, are delayed in accepting for payment or paying for shares or are unable to accept for payment or pay for shares pursuant to the tender offer for any reason, then, without prejudice to our rights under the tender offer, the Depositary may, on our behalf, retain all shares tendered, and such shares may not be withdrawn except as otherwise provided in this Section 4, subject to Rule 13e-4(f)(5) under the Exchange Act, which provides that the issuer making the tender offer shall either pay the consideration offered, or return the tendered securities, promptly after the termination or withdrawal of the tender offer.
For a withdrawal to be effective, a written or facsimile transmission notice of withdrawal must:
| • | be timely received by the Depositary at its address set forth on the back cover of this Offer to Purchase; and |
| • | specify the name of the person who tendered the shares to be withdrawn, the number of shares to be withdrawn and the name of the registered holder of the shares, if different from that of the person who tendered such shares. |
If the shares to be withdrawn have been delivered to the Depositary, a signed notice of withdrawal with signatures guaranteed by an Eligible Institution (except in the case of shares tendered by an Eligible Institution) must be submitted prior to the release of such shares. In addition, such notice must specify, in the case of shares tendered by delivery of certificates, the name of the registered holder (if different from that of the tendering stockholder) and the serial numbers shown on the particular certificates evidencing the shares to be withdrawn or, in the case of shares tendered by book-entry transfer, the name and number of the account at the Book-Entry Transfer Facility to be credited with the withdrawn shares.
Withdrawals may not be rescinded, and shares withdrawn will thereafter be deemed not properly tendered for purposes of the tender offer.
However, withdrawn shares may be retendered by following one of the procedures described in Section 3 at any time prior to the Expiration Date.
We will determine all questions as to the form and validity (including time of receipt) of any notice of withdrawal. We also reserve the right to waive any defect or irregularity in the withdrawal of shares by any stockholder. None of the Company, the Dealer Managers, the Information Agent, the Depositary, any of their respective affiliates or any other person will be under any duty to give notification of any defect or irregularity in any notice of withdrawal or incur any liability for failure to give any such notification.
| 5. | Purchase of Shares and Payment of Purchase Price. |
On the terms and subject to the conditions of the tender offer, promptly following the Expiration Date, we will (1) determine the Purchase Price we will pay for shares properly tendered and not properly withdrawn prior to the Expiration Date, taking into account the number of shares so tendered and the prices specified by tendering stockholders and (2) accept for payment and pay an aggregate purchase price of up to $1,000,000,000 (or such
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greater amount as we may elect to purchase, subject to applicable law) for shares that are properly tendered at prices at or below the Purchase Price and not properly withdrawn prior to the Expiration Date. For purposes of the tender offer, we will be deemed to have accepted for payment, subject to the “odd lot” priority, proration and conditional tender provisions of the tender offer, shares that are properly tendered at or below the Purchase Price and not properly withdrawn, only when, as and if we give oral or written notice to the Depositary of our acceptance of the shares for payment pursuant to the tender offer.
Upon the terms and subject to the conditions of the tender offer, we will accept for payment and pay the Purchase Price per share for all of the shares accepted for payment pursuant to the tender offer promptly after the Expiration Date. In all cases, payment for shares tendered and accepted for payment pursuant to the tender offer will be made promptly, taking into account any time necessary to determine any proration, but only after timely receipt by the Depositary of (1) certificates for shares, or a timely book-entry confirmation of the deposit of shares into the Depositary’s account at DTC,(2) a validly completed and duly executed Letter of Transmittal including any required signature guarantees, or, in the case of a book-entry transfer, an Agent’s Message, and (3) any other required documents.
For purposes of the tender offer, we will be deemed to have accepted for payment and therefore purchased shares that are properly tendered at or below the Purchase Price and not properly withdrawn, subject to the “odd lot” priority, proration and conditional tender provisions of the tender offer, only when, as and if we give oral or written notice to the Depositary of our acceptance of the shares for payment pursuant to the tender offer.
We will pay for shares purchased under the tender offer by depositing the aggregate purchase price for such shares with the Depositary, which will act as agent for the purpose of receiving payment from us and transmitting payment to the tendering stockholders. See the Letter of Transmittal. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE BE PAID BY US REGARDLESS OF ANY DELAY IN MAKING SUCH PAYMENT. IN ADDITION, IF CERTAIN EVENTS OCCUR, WE MAY NOT BE OBLIGATED TO PURCHASE SHARES UNDER THE TENDER OFFER. SEE SECTION 7.
In the event of proration, we will determine the proration factor and pay for those tendered shares accepted for payment promptly after the Expiration Date. The preliminary results of any proration will be announced by press release promptly after the Expiration Date. See Section 1. Certificates for all shares tendered and not purchased, including all shares not purchased due to proration, will be returned to the tendering stockholder, or, in the case of shares tendered by book-entry transfer, will be credited to the account maintained with the Book-Entry Transfer Facility by the participant therein who so delivered the shares, at our expense, promptly after the Expiration Date or termination of the tender offer. Except as otherwise provided in this Section 5 and the Letter of Transmittal, we will pay all stock transfer taxes, if any, payable on the transfer to us of shares purchased pursuant to the tender offer. If, however, payment of proceeds in respect of any shares purchased is to be made to, or shares not tendered or not purchased are to be returned in the name of, any person other than the registered holder(s), or if tendered shares are registered in the name of any person other than the person(s) signing the Letter of Transmittal, the amount of all stock transfer taxes, if any (whether imposed on the registered holder(s), such other person or otherwise), payable on account of the transfer to such other person will be the responsibility of the tendering stockholder. See the Letter of Transmittal.
ANY TENDERING STOCKHOLDER OR OTHER PAYEE WHO FAILS TO PROPERLY COMPLETE, EXECUTE AND DELIVER A FORM W-9 (INCLUDED WITH THE LETTER OF TRANSMITTAL) OR AN APPLICABLE FORM W-8 MAY BE SUBJECT TO U.S. FEDERAL BACKUP WITHHOLDING ON THE GROSS PROCEEDS PAID PURSUANT TO THE TENDER OFFER. IN ADDITION, NON-U.S. HOLDERS (AS DEFINED IN SECTION 13) MAY BE SUBJECT TO U.S. FEDERAL WITHHOLDING TAX AT A RATE OF 30% (OR SUCH LOWER RATE AS MAY BE SPECIFIED BY AN APPLICABLE INCOME TAX TREATY) ON THE GROSS PROCEEDS PAID PURSUANT TO THE TENDER OFFER. SEE SECTION 3 AND SECTION 13.
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| 6. | Conditional Tender of Shares. |
Subject to the exception for holders of odd lots, in the event of an oversubscription of the tender offer, shares tendered prior to the Expiration Date will be subject to proration. See Section 1. As discussed in Section 13, the number of shares to be purchased from a particular stockholder may affect the U.S. federal income tax treatment of the purchase to the stockholder and the stockholder’s decision whether to tender. Accordingly, a stockholder may tender shares subject to the condition that a specified minimum number of the stockholder’s shares tendered pursuant to a Letter of Transmittal must be purchased if any shares tendered are purchased. Any stockholder wishing to make a conditional tender must so indicate in the box entitled “Conditional Tender” in the Letter of Transmittal and indicate the minimum number of shares that must be purchased if any are to be purchased. We urge each stockholder to consult with his, her or its own financial and tax advisors. No assurances can be provided that a conditional tender will achieve the intended U.S. federal income tax result for any tendering stockholder.
After the Expiration Date, if the number of shares properly tendered and not properly withdrawn pursuant to the tender offer at a price equal to or less than the Purchase Price and pursuant to the “Shares Tendered at Price Determined Pursuant to the Tender Offer” alternative would result in an aggregate purchase price of more than $1,000,000,000, so that we must prorate our acceptance of and payment for tendered shares, we will calculate a preliminary proration percentage, after taking into account the priority given to tenders of odd lots, based upon all shares properly tendered, conditionally or unconditionally, and not properly withdrawn. If the effect of this preliminary proration would be to reduce the number of shares to be purchased from any stockholder tendered pursuant to a Letter of Transmittal below the minimum number specified, the shares conditionally tendered will automatically be regarded as withdrawn (except as provided in the next paragraph). All shares tendered by a stockholder subject to a conditional tender and that are withdrawn as a result of proration will be returned at our expense to the tendering stockholder.
After giving effect to these withdrawals, we will accept the remaining shares properly tendered, conditionally or unconditionally, on a pro rata basis, if necessary. If the withdrawal of conditional tenders would cause the total number of shares to be purchased to fall below an aggregate purchase price of $1,000,000,000, then, to the extent feasible, we will select enough of the shares conditionally tendered that would otherwise have been withdrawn to permit us to purchase such number of shares. In selecting among the conditional tenders, we will select by random lot, treating all tenders by a particular stockholder as a single lot, and will limit our purchase in each case to the designated minimum number of shares to be purchased. To be eligible for purchase by random lot, stockholders whose shares are conditionally tendered must have properly tendered all of their shares and not properly withdrawn them prior to the Expiration Date.
We note that if shares having an aggregate purchase price of more than $1,000,000,000 are tendered in the tender offer and not properly withdrawn, we reserve the right to accept for purchase at the Purchase Price pursuant to the tender offer up to an additional 2% of our outstanding shares without amending or extending the tender offer.
| 7. | Conditions of the Tender Offer. |
Notwithstanding any other provision of the tender offer, we will not be required to accept for payment or pay for any shares tendered, and may terminate or amend the tender offer or may postpone the acceptance for payment of, and the payment for, shares tendered, subject to the requirements of the Exchange Act for prompt payment for or return of shares, if at any time on or after the date of this Offer to Purchase and before the Expiration Date any of the following events shall have occurred or are reasonably determined by us to have occurred, that, in the reasonable judgment of our Board of Directors and regardless of the circumstances giving rise to such event, makes it inadvisable to proceed with the tender offer or with acceptance for payment or payment:
| (1) | there shall have been threatened, instituted or pending any action or proceeding by any government or governmental, regulatory or administrative agency, authority or tribunal or any |
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| other person, domestic or foreign, before any court, authority, agency or tribunal that directly or indirectly (i) challenges the making of the tender offer or the acquisition of some or all of the shares pursuant to the tender offer or otherwise relates in any manner to the tender offer or (ii) in our reasonable judgment, could materially and adversely affect our and our subsidiaries’ business, condition (financial or otherwise), assets, income, operations or prospects, taken as a whole, or otherwise materially impairs in any way the contemplated future conduct of the business of us and our subsidiaries, taken as a whole, or materially impairs our ability to purchase the shares in the tender offer; |
| (2) | there shall have been any action threatened, pending or taken, or approval withheld, or any statute, rule, regulation, judgment, order or injunction threatened, proposed, sought, promulgated, enacted, entered, amended, enforced or deemed to be applicable to the tender offer or us or any of our subsidiaries, by any court or any authority, agency or tribunal that, in our reasonable judgment, would or is reasonably likely to directly or indirectly (i) makes the acceptance for payment of, or payment for, some or all of the shares illegal or otherwise restricts or prohibits completion of the tender offer, (ii) delays or restricts our ability, or renders us unable, to accept for payment or pay for some or all of the shares or (iii) materially and adversely affects our and our subsidiaries’ business, condition (financial or otherwise), assets, income, operations or prospects, taken as a whole, or otherwise materially impairs in any way the contemplated future conduct of the business of us and our subsidiaries; |
| (3) | there shall have occurred (i) any general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the over-the-counter market in the United States, (ii) the declaration of a banking moratorium or any suspension of payments in respect of banks in the United States, (iii) the commencement or escalation of a war, armed hostilities or other international or national calamity directly or indirectly involving the United States or any of its territories, including, but not limited to, an act of terrorism, on or after February 1, 2021, the last trading day prior to the commencement of the tender offer, (iv) any change in the general political, public health (including with respect the impact of the COVID-19 pandemic), market, economic or financial conditions in the United States or abroad that could, in our reasonable judgment, have a material adverse effect on our and our subsidiaries’ business, condition (financial or otherwise), assets, income, operations or prospects, taken as a whole, or (v) in the case of any of the foregoing existing at the time of the commencement of the tender offer, a material acceleration or worsening thereof; |
| (4) | there shall have been a decrease of more than 10% in the market price for the Company’s shares or in the Dow Jones Industrial Average, the New York Stock Exchange Index, the NASDAQ Composite Index or the Standard and Poor’s 500 Composite Index measured from the close of trading on February 1, 2021; |
| (5) | there shall have occurred any limitation, whether or not mandatory, by any governmental, regulatory or administrative agency or authority on, or any event that could reasonably be expected to materially affect, the extension of credit by banks or other lending institutions in the United States; |
| (6) | any necessary regulatory approvals or non-objections shall not have been obtained or shall not remain in full force and effect; |
| (7) | a tender or exchange offer for any or all of the shares, or any merger, acquisition, business combination or other similar transaction with or involving us or any of our subsidiaries, has been proposed, announced or made by any person or has been publicly disclosed or we have entered into a definitive agreement or an agreement in principle with any person with respect to a merger, acquisition, business combination or other similar transaction since February 1, 2021, other than in the ordinary course of business (in each case other than the tender offer); |
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| (8) | any change in law or in the official interpretation or administration of law, or relevant position or policy of a governmental authority with respect to any laws, applicable to the tender offer; |
| (9) | the consummation of the tender offer and the purchase of shares will cause the shares to cease to be held of record by less than 300 persons or to be traded on or listed on NASDAQ or otherwise cause the shares to be subject to deregistration under the Exchange Act; |
| (10) | a person or “group” (as that term is used in Section 13(d)(3) of the Exchange Act) has acquired or proposes to acquire beneficial ownership of more than 5% of the outstanding shares, whether through the acquisition of stock, the formation of a group, the grant of any option or right, or otherwise (other than as and to the extent disclosed in a Schedule 13D or Schedule 13G filed with the Commission on or before February 1, 2021); |
| (11) | a person or group who has filed a Schedule 13D or Schedule 13G with the Commission on or before February 1, 2021, has acquired or proposes to acquire, whether through the acquisition of stock, the formation of a group, the grant of any option or right, or otherwise (other than solely as a result of the tender offer made hereby), beneficial ownership of an additional 1% or more of the outstanding shares; or |
| (12) | a person shall have filed a Notification and Report Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, or made a public announcement reflecting an intent to acquire us or any of our subsidiaries or any of our assets or securities. |
The foregoing conditions are for our sole benefit and may be asserted by us regardless of the circumstances giving rise to any such condition, and may be waived by us, in whole or in part, at any time in our sole discretion on or before the Expiration Date. Our failure at any time to exercise any of the foregoing rights will not be deemed a waiver of any such right. Each such right is an ongoing right and may be asserted at any time and from time to time. However, once the tender offer has expired, then all of the conditions to the tender offer must have been satisfied or waived. In certain circumstances, if we waive any of the conditions described above, we may be required to extend the tender offer. See Section 14. Any determination or judgment by us concerning the events described above will be final and binding, subject to a shareholder’s right to challenge our determination in a court of competent jurisdiction.
| 8. | Price Range of Shares; Dividends. |
The shares are listed and traded on NASDAQ under the trading symbol “SLM.” The following table sets forth, for each of the periods indicated, the high and low sales prices of the shares as reported on NASDAQ.
| Market Price | Dividends | |||||||||||
| High | Low | |||||||||||
| 2019 |
||||||||||||
| First Quarter |
$ | 11.43 | $ | 8.53 | $ | 0.03 | ||||||
| Second Quarter |
10.38 | 9.11 | 0.03 | |||||||||
| Third Quarter |
10.13 | 7.84 | 0.03 | |||||||||
| Fourth Quarter |
9.13 | 8.11 | 0.03 | |||||||||
| 2020 |
||||||||||||
| First Quarter |
$ | 12.28 | $ | 6.45 | $ | 0.03 | ||||||
| Second Quarter |
8.69 | 6.10 | 0.03 | |||||||||
| Third Quarter |
8.22 | 6.59 | 0.03 | |||||||||
| Fourth Quarter |
12.45 | 8.14 | 0.03 | |||||||||
| 2021 |
||||||||||||
| First Quarter (through February 1, 2021) |
$14.66 | $12.03 | $ | 0.03 | ||||||||
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On February 1, 2021, the last trading day prior to the commencement by the Company of the tender offer, the last reported sale price of the shares on NASDAQ was $13.78 per share. We urge stockholders to obtain current market quotations for the shares before deciding whether to tender their shares and at what price.
On January 26, 2021, the Company announced a quarterly dividend of $0.03 per share of common stock, payable on March 15, 2021 to stockholders of record at the close of business on March 5, 2021. The dividend will be paid to stockholders of record at the close of business on March 5, 2021 regardless of whether such stockholder tenders its shares in the tender offer.
| 9. | Source and Amount of Funds. |
Assuming the tender offer is fully subscribed, and assuming we do not exercise our right to purchase up to an additional 2% of our outstanding shares, we expect that the aggregate cost of the purchases, including all fees and expenses related to the tender offer, will be approximately $1,003,400,000. The Company expects to fund the tender offer with cash on hand. There is no financing condition to the tender offer, although the tender offer is subject to certain other conditions. See Section 7.
| 10. | Certain Information Concerning Us. |
General. SLM Corporation, more commonly known as Sallie Mae, was formed in late 2013 and includes its wholly-owned subsidiary, Sallie Mae Bank, an industrial bank established in 2005 (the “Bank”). On April 30, 2014, the Company legally separated (the “Spin-Off”) from another public company that is now named Navient Corporation (“Navient”), which is in the education loan management, servicing, asset recovery and consolidation loan business. Navient retained all assets and liabilities generated prior to the Spin-Off other than those explicitly retained by us pursuant to a Separation and Distribution Agreement executed in connection with the Spin-Off. The Company is a consumer banking business and did not retain any assets or liabilities generated prior to the Spin-Off other than those explicitly retained by us pursuant to the Separation and Distribution Agreement. The Company sometimes refers to the company that existed prior to the Spin-Off as “pre-Spin-Off SLM.” The Bank was formed in 2005 to fund and originate private education loans on behalf of pre-Spin-Off SLM. The Company is a leader in private student lending, providing financing and information to help students attend college and offering products and resources to help customers make new goals and experiences, beyond college, possible.
The principal executive office of the Company is located at 300 Continental Drive, Newark, Delaware 19713 and its telephone number is (302) 451-0200. The Company’s website address is www.salliemae.com. This website address is not intended to be an active link and information on the Company’s website is not incorporated in, and should not be construed to be part of, this Offer to Purchase.
Additional Information About Us. We are subject to the information requirements of the Exchange Act, and in accordance therewith file periodic reports, proxy statements and other information relating to our business, financial condition and other matters. We are required to disclose in such proxy statements certain information, as of particular dates, concerning our directors and executive officers, their compensation, the principal holders of our securities and any material interest of such persons in transactions with us. Pursuant to Rule 13e-4(c)(2) under the Exchange Act, we have filed with the Commission a Tender Offer Statement on Schedule TO, which includes additional information with respect to the tender offer. Such material and other information may be viewed on the Commission’s website, www.sec.gov.
Incorporation by Reference. The rules of the Commission allow us to “incorporate by reference” information into this Offer to Purchase, which means that we can disclose important information to you by referring you to another document filed separately with the Commission. These documents contain important information about us. We incorporate by reference into this Offer to Purchase each of the documents listed below (in each case, to the extent that the material contained therein is deemed “filed” rather than “furnished”).
| Commission Filings |
Date Filed | |
| The Annual Report on Form 10-K for the fiscal year ended December 31, 2019 | February 28, 2020 |
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| Commission Filings |
Date Filed | |
| Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2020, June 30, 2020 and September 30, 2020 | April 22, 2020, July 22, 2020 and October 21, 2020 | |
| Current Reports on Form 8-K | March 5, 2020, March 10, 2020, April 15, 2020, June 23, 2020, June 24, 2020, August 10, 2020, August 25, 2020, September 21, 2020, October 26, 2020 (four reports), October 27, 2020, October 29, 2020, November 25, 2020 and February 2, 2021 | |
| The portions of the Company’s Definitive Proxy Statement on Schedule 14A for the Company’s Annual Meeting of Stockholders, incorporated by reference into its Annual Report on Form 10-K for the fiscal year ended December 31, 2019 | April 28, 2020 | |
These documents include periodic reports, such as annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy materials.
You can obtain the documents described under “Additional Information About Us” and any of the documents incorporated by reference in this Offer to Purchase from the Commission’s website at www.sec.gov. You can also obtain the documents described under “Additional Information About Us” and documents incorporated by reference in this Offer to Purchase, without charge, by requesting them in writing or by telephone from us at 300 Continental Drive, Newark, Delaware 19713. Please be sure to include your complete name and address in the request. If you request any incorporated documents, we will mail them by first class mail, or another equally prompt means, promptly after we receive the request.
| 11. | Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares. |
As of January 27, 2021, we had 375,914,746 issued and outstanding shares (and 6,142,800 shares reserved for issuance upon exercise of Stock Options and vesting of RSUs and PSUs (assuming PSUs vest at the specified target performance threshold)). Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $15.00, the maximum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 66,666,666 shares, which would represent approximately 17.73% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 17.45% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares). If the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed at a Purchase Price of $13.10, the minimum Purchase Price pursuant to the tender offer, the completion of the tender offer will result in the repurchase by the Company of 76,335,877 shares, which would represent approximately 20.31% of our issued and outstanding shares as of January 27, 2021 (which excludes Potential Shares), or approximately 19.98% of our outstanding shares on a fully diluted basis as of January 27, 2021 (which includes Potential Shares).
Our directors and executive officers as a group beneficially owned an aggregate of 1,335,525 shares of our common stock (excluding restricted common stock), representing 0.3% of our issued and outstanding shares (excluding restricted common stock) as of January 27, 2021. Our directors and executive officers have informed us that they do not intend to participate in the tender offer. To our knowledge, none of our affiliates intends to tender any shares in the tender offer; however, there can be no assurance that such intent will not change prior to the termination of the tender offer.
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Beneficial Ownership of Directors and Executive Officers.
The following table shows, as of January 27, 2021, information regarding the beneficial ownership of shares by (i) each executive officer, (ii) each director, and (iii) all current directors and executive officers as a group. Beneficial ownership is determined under rules issued by the SEC. Under these rules, beneficial ownership includes any shares as to which the individual has sole or shared voting power or investment power. In computing the number of shares beneficially owned by an individual and the percentage ownership of that person, shares of common stock subject to options or other rights held by such person that are currently exercisable or will become exercisable within 60 days of January 27, 2021 are considered outstanding, although these shares are not considered outstanding for purposes of computing the percentage ownership of any other person.
Assuming we purchase 76,335,877 shares (the amount at an assumed Purchase Price of $13.10 per share) and that our directors and executive officers do not tender any shares pursuant to the tender offer, then, after the tender offer, our directors and executive officers as a group will beneficially own approximately 0.4% of our outstanding shares (excluding restricted common stock). The percentages outstanding are based on 375,914,746 shares of common stock outstanding as of January 27, 2021. The address of each of the persons listed below is c/o SLM Corporation, 300 Continental Drive, Newark, Delaware 19713.
| Name |
Number of Shares Beneficially Owned |
Percent of Class |
||||||
| Directors |
||||||||
| Paul G. Child |
65,867 | * | ||||||
| Mary Carter Warren Franke |
64,010 | * | ||||||
| Earl A. Goode |
146,384 | * | ||||||
| Marianne M. Keler(1) |
100,617 | * | ||||||
| Mark L. Lavelle |
24,043 | * | ||||||
| Jim Matheson |
58,834 | * | ||||||
| Frank C. Puleo |
156,657 | * | ||||||
| Vivian C. Schneck-Last |
57,957 | * | ||||||
| William N. Shiebler(2) |
78,538 | * | ||||||
| Robert S. Strong |
81,010 | * | ||||||
| Jonathan W. Witter |
— | * | ||||||
| Kirsten O. Wolberg |
39,541 | * | ||||||
| Executive Officers |
||||||||
| Jonathan Witter |
— | |||||||
| Steven J. McGarry(3) |
283,617 | * | ||||||
| Donna F. Vieira |
32,007 | * | ||||||
| Jonathan R. Boyles |
50,873 | * | ||||||
| Kerri A. Palmer |
— | * | ||||||
| Nicolas Jafarieh |
61,595 | * | ||||||
| Daniel P. Kennedy |
177,910 | * | ||||||
| Current Directors and Executive Officers as a Group (18 Persons) |
1,479,460 | * | ||||||
| * | Represents beneficial ownership of less than 1 percent. |
| (1) | Includes 76,574 shares held in trust. |
| (2) | Includes 1,027 shares held in trust and 10,000 shares held in a partnership. |
| (3) | Includes 111 shares credited as phantom stock units due to a deferred compensation plan account. |
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Recent Securities Transactions.
Based on our records and on information provided to us by our directors, executive officers and affiliates, neither we nor, to the best of our knowledge, any of our affiliates, directors or executive officers, have effected any transactions involving shares of our common stock during the 60 days prior to the date of this Offer to Purchase, except as otherwise set forth in this Offer to Purchase.
Arrangements Concerning the Securities.
Except as otherwise described herein, neither we nor, to the best of our knowledge, any of our affiliates, directors or executive officers, is a party to any contract, agreement, arrangement, understanding or relationship with any other person with respect to any of our securities.
Omnibus Incentive Plan. Our 2012 Omnibus Incentive Plan (the “Omnibus Incentive Plan”) authorizes us to grant stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards to our employees, officers, directors and other eligible participants. The Omnibus Incentive Plan is administered by the Nominations, Governance and Compensation Committee of our Board of Directors, which is authorized to, among other things, determine the type or types of awards to be made to employees under the Omnibus Incentive Plan and shall designate from time to time the employees who are to be the recipients of such awards. As of January 27, 2021, approximately 6,142,800 shares of common stock were subject to outstanding awards under the Omnibus Incentive Plan and 12,983,107 shares of common stock were reserved for future issuance under the Omnibus Incentive Plan. The foregoing description is qualified in its entirety by reference to the text of the Omnibus Incentive Plan, a copy of which has been filed as an exhibit to the Schedule TO-I to which this Offer to Purchase is an exhibit.
Employee Stock Purchase Plan. We maintain the Sallie Mae Employee Stock Purchase Plan (the “ESPP”) to allow eligible employees to purchase shares of common stock at 85% of the fair market value of our common stock on the first business day of the applicable plan year. Subject to limitations set forth in the ESPP, employees may authorize the Company to deduct amounts ranging from 1% to 25% of their compensation for contribution toward ESPP purchases. As of January 27, 2021, approximately 14,645,894 shares of common stock remained for issuance under the ESPP. The foregoing description is qualified in its entirety by reference to the text of the ESPP, a copy of which has been filed as an exhibit to the Schedule TO-I to which this Offer to Purchase is an exhibit.
Stock Ownership Guidelines for Executive Officers. We maintain stock ownership guidelines for our executive officers. The guidelines encourage continued beneficial ownership of a significant amount of our common stock acquired through equity awards and help align the interests of our executive officers with the interests of our stockholders. Executive officers generally must hold all common stock acquired through equity grants until the applicable thresholds are met, and an executive will not be eligible to receive further equity grants for the year if he or she sells the stock and such sale would result in a decrease below the established thresholds. All current executive officers were in compliance with the share ownership guidelines as of December 31, 2020 or are expected to achieve compliance within the applicable five-year period.
Stock Ownership Guidelines for Directors. We maintain stock ownership guidelines for our non-employee directors. Under our stock ownership guidelines, each director is expected, within five years of initial election to the Board of Directors, to own common stock with a value equivalent to four times his or her annual cash retainer for serving on our Board of Directors. As of December 31, 2020, all then current directors were in compliance with our stock ownership guidelines or are expected to achieve compliance within the applicable five-year period.
Share Repurchase Authorization. On January 22, 2020, we announced a $600 million share repurchase program. Any repurchase will comply with Rule 10b-18 under the Exchange Act, and the program is subject to
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market conditions, applicable legal requirements, contractual obligations, and other factors. The repurchase program does not obligate the Company to acquire any specific number of shares and may be suspended or terminated at any time. On March 10, 2020, we entered into an accelerated share repurchase agreement with JPMorgan Chase Bank, National Association, New York Branch, under which we will purchase $525 million of our outstanding common stock. On January 26, 2021, we completed this share purchase agreement and final settlement occurred on January 28, 2021. In total, the Company has repurchased 58 million shares of common stock under the accelerated share repurchase agreement at an average price per share of $9.01. The foregoing description is qualified in its entirety by reference to the text of the Fixed Dollar Uncollared ASR Master Confirmation and Form of Supplement, a copy of which has been filed as an exhibit to the Schedule TO-I to which this Offer to Purchase is an exhibit. On January 26, 2021, our Board of Directors authorized the repurchase of shares of our common stock, from time to time over the next 24 months, in transactions that may include, without limitation, tender offers, open market purchases, repurchases effected though 10b5-1 trading plans, negotiated block purchases, accelerated share repurchase programs, or other similar transactions, in an aggregate amount not to exceed $1.25 billion. Whether we make additional repurchases will depend on many factors, including, without limitation, the number of shares, if any, that we purchase in this tender offer, our business and financial performance and situation, the business and market conditions at the time, including the price of the shares, and such other factors as we may consider relevant. Any of these repurchases may be on the same terms or on terms that are more or less favorable to the selling stockholders in those transactions than the terms of the tender offer.
| 12. | Legal Matters; Regulatory Approvals. |
We are not aware of the applicability of any antitrust laws or any license or regulatory permit that appears material to our business that might be adversely affected by our acquisition of the shares as contemplated by the tender offer or of any approval or other action by any government or governmental, administrative or regulatory authority or agency, domestic, foreign or supranational, that would be required for our acquisition or ownership of the shares as contemplated by the tender offer. Should any such approval or other action be required, we presently contemplate that we will seek that approval or other action. We are unable to predict whether we will be required to delay the acceptance for payment of or payment for shares tendered pursuant to the tender offer pending the outcome of any such matter. There can be no assurance that any such approval or other action, if needed, would be obtained or would be obtained without substantial cost or conditions or that the failure to obtain the approval or other action might not result in adverse consequences to our business and financial condition. Our obligations under the tender offer to accept shares for payment and pay for shares is subject to certain conditions. See Section 7.
| 13. | Material U.S. Federal Income Tax Consequences. |
The following discussion is a general summary of the material U.S. federal income tax consequences to U.S. Holders and Non-U.S. Holders (each as defined below) of a sale of shares pursuant to the tender offer. This summary is based upon the Internal Revenue Code of 1986, as amended (the “Code”), the applicable Treasury regulations promulgated thereunder, published rulings and administrative pronouncements of the IRS and applicable judicial decisions, all as in effect as of the date hereof and all of which are subject to change or differing interpretations, possibly on a retroactive basis, and any such change or differing interpretation could affect the accuracy of the statements contained in this discussion.
This discussion addresses only beneficial owners who hold their shares as “capital assets” within the meaning of Section 1221 of the Code (generally, property held for investment) and does not address all U.S. federal income tax consequences that may be relevant to beneficial owners in light of their particular circumstances or to beneficial owners subject to special rules under the U.S. federal income tax laws (such as, for example, dealers or brokers in securities or commodities, traders in securities who elect to apply a mark-to-market method of tax accounting, U.S. Holders whose “functional currency” is not the U.S. dollar, banks or other financial institutions, insurance companies, tax-exempt organizations, pension plans, regulated
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investment companies or real estate investment trusts, controlled foreign corporations, passive foreign investment companies, former citizens or residents of the United States, U.S. expatriates, partnerships or other pass- through entities for U.S. federal income tax purposes (or investors therein), persons who hold shares as part of a hedge, appreciated financial position, straddle, conversion or other risk reduction or integrated transaction, persons for whom the sale of shares pursuant to the tender offer would constitute a “wash sale” for U.S. federal income tax purposes, persons who hold or received their shares pursuant to the exercise of any employee stock options or otherwise as compensation or through a tax-qualified retirement plan, and persons who hold (or that held, directly, indirectly or constructively, at any time during the five-year period ending on the date of the sale of their shares pursuant to the tender offer) more than 5% of the Company’s common stock). This discussion does not address the effect of any state, local or non-U.S. tax laws or any U.S. federal tax considerations other than those pertaining to the income tax (e.g., estate or gift tax), that may be applicable to beneficial owners of shares, nor does it address any aspects of the unearned income Medicare contribution tax under Section 1411 of the Code or the alternative minimum tax.
Beneficial owners should consult their own tax advisors regarding the tax consequences of a sale of shares pursuant to the tender offer, including the applicability and effect of any state, local and non-U.S. tax laws.
As used herein, a “U.S. Holder” means a beneficial owner of shares that is, for U.S. federal income tax purposes, (i) an individual who is a citizen or resident of the United States, (ii) a corporation organized in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source or (iv) a trust (A) the administration of which is subject to primary supervision of a court within the United States and with respect to which one or more U.S. persons have the authority to control all substantial decisions of the trust, or (B) that has a valid election in effect under applicable Treasury regulations to be treated as a U.S. person. As used herein, a “Non-U.S. Holder” means a beneficial owner of shares that is neither a U.S. Holder nor an entity or arrangement treated as a partnership for U.S. federal income tax purposes.
If an entity or an arrangement treated as a partnership for U.S. federal income tax purposes holds shares, the U.S. federal income tax treatment of a person that is treated as a partner in such entity or arrangement generally will depend on the status of the partner and the activities of the partnership. Any entity or arrangement treated as a partnership for U.S. federal income tax purposes that holds shares and any partners in such partnerships should consult their own tax advisors regarding the U.S. federal income and other tax consequences of a sale of shares pursuant to the tender offer.
Material U.S. Federal Income Tax Consequences of the Tender Offer to Tendering U.S. Holders.
The sale of shares by a U.S. Holder pursuant to the tender offer will, depending on such U.S. Holder’s particular facts and circumstances, generally be treated as a sale or exchange for U.S. federal income tax purposes or as a distribution with respect to such U.S. Holder’s shares. Under Section 302(b) of the Code, a sale of shares pursuant to the tender offer generally will be treated as a “sale or exchange” for U.S. federal income tax purposes, rather than as a distribution with respect to such shares held by the tendering U.S. Holder, if the sale: (i) results in a “complete termination” of the U.S. Holder’s equity interest in the Company under Section 302(b)(3) of the Code, (ii) is “substantially disproportionate” with respect to the U.S. Holder under Section 302(b)(2) of the Code or (iii) is “not essentially equivalent to a dividend” with respect to the U.S. Holder under Section 302(b)(1) of the Code, each as described below (the “Section 302 tests”).
In applying each of the Section 302 tests, a U.S. Holder must take into account not only the shares that are actually owned by the U.S. Holder, but also shares that are constructively owned by the U.S. Holder within the meaning of Section 318 of the Code. Very generally, a U.S. Holder may constructively own shares that are actually owned, and in some cases constructively owned, by certain members of the U.S. Holder’s family and certain entities (such as corporations, partnerships, trusts and estates) in which the U.S. Holder has an interest, as
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well as shares that the U.S. Holder has a right to acquire by exercise of an option or warrant or by conversion or exchange of a security. U.S. Holders should be aware that acquisitions or dispositions of shares as part of a plan that includes the U.S. Holder’s sale of shares pursuant to the tender offer may need to be taken into account in determining whether any of the Section 302 tests are satisfied. U.S. Holders should also be aware that their ability to satisfy any of the Section 302 tests may be affected by proration pursuant to the tender offer. Due to the factual nature of these tests, U.S. Holders should consult their own tax advisors to determine whether a sale of shares pursuant to the tender offer qualifies for sale or exchange treatment under these tests in light of their particular circumstances.
The sale of shares pursuant to the tender offer generally will result in a “complete termination” of the U.S. Holder’s interest in the Company if either (i) the U.S. Holder owns no shares of Company stock actually or constructively after the shares are sold pursuant to the tender offer or (ii) the U.S. Holder actually owns no shares of Company stock after the tender offer and, with respect to shares constructively owned, is eligible to waive, and effectively waives, constructive ownership of all such shares in accordance with the procedures described in Section 302(c)(2) of the Code. U.S. Holders intending to satisfy the “complete termination” test through a waiver of attribution should consult their tax advisors concerning the mechanics and desirability of such a waiver.
The sale of shares pursuant to the tender offer generally will result in a “substantially disproportionate” redemption with respect to a U.S. Holder if the percentage of the Company’s outstanding shares actually and constructively owned by the U.S. Holder immediately after the sale is less than 80% of the percentage of the Company’s outstanding shares actually and constructively owned by the U.S. Holder immediately before the sale.
Even if a sale of shares by a U.S. Holder pursuant to the tender offer fails to satisfy the “complete termination” test or the “substantially disproportionate” test, a U.S. Holder may nevertheless satisfy the “not essentially equivalent to a dividend” test if the reduction in the U.S. Holder’s proportionate interest in the Company’s stock as a result of the tender offer constitutes a “meaningful reduction.” The IRS has indicated in published guidance that generally, even a small reduction in the percentage ownership interest of a stockholder whose relative stock interest in a publicly held corporation (such as the Company) is minimal and who exercises no control over the corporation’s business should constitute a meaningful reduction.
U.S. Holders should consult their tax advisors to determine the application of this test (and the other Section 302 tests) in light of their particular circumstances.
If any of these three Section 302 tests for “sale or exchange” treatment is met, a U.S. Holder will recognize gain or loss on the receipt of cash in exchange for shares pursuant to the tender offer equal to the difference between the amount of cash received and the adjusted tax basis of the shares sold. The gain or loss will be capital gain or loss and generally will be long-term capital gain or loss if the holding period for such shares is more than one year as of the date of the sale. Long-term capital gain recognized by a non-corporate U.S. Holder generally will be subject to U.S. federal income tax at a reduced rate. The ability to deduct capital losses is subject to limitations. A U.S. Holder must calculate gain or loss separately for each block of shares (generally, shares acquired at the same cost in a single transaction) that we purchase from the U.S. Holder pursuant to the tender offer.
If none of the tests set forth in Section 302(b) of the Code is met with respect to a U.S. Holder, amounts received by such U.S. Holder pursuant to the tender offer will be treated as a distribution with respect to such U.S. Holder’s remaining shares. The distribution will be taxable to the U.S. Holder as a “dividend” to the extent of such U.S. Holder’s allocable share of the Company’s current or accumulated earnings and profits. To the extent the amount of the distribution exceeds the amount treated as a dividend, the excess will constitute a non-taxable return of capital to the extent of (and in reduction of) the U.S. Holder’s tax basis in the relevant shares, and any remaining portion will be treated as capital gain from the sale or exchange of shares. Any such capital gain will be long-term capital gain if the U.S. Holder’s holding period for the shares on the date of the
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sale exceeds one year. If any amounts received by a tendering U.S. Holder are treated as a “dividend,” the tax basis (after any adjustment for non-taxable return of capital discussed above) in the shares sold pursuant to the tender offer will be added to any remaining shares held by such U.S. Holder. However, where the remaining shares owned consist of more than one class (e.g., the common and preferred shares), it is unclear how to allocate such tax basis among the remaining shares. If a tendering U.S. Holder does not actually retain any shares, the basis may (depending on circumstances) be added to shares retained by a person related to such U.S. Holder, or the basis may be lost. A dividend received by a non-corporate U.S. Holder may be treated as “qualified dividend income” that is subject to reduced tax rates (subject to applicable requirements, exceptions and limitations). A dividend received by a corporate U.S. Holder may be (i) eligible for a dividends-received deduction (subject to applicable requirements, exceptions and limitations) and (ii) subject to the “extraordinary dividend” provisions of Section 1059 of the Code. U.S. Holders that are corporations for U.S. federal income tax purposes should consult their own tax advisors regarding the U.S. federal tax consequences of the tender offer to them in light of their particular circumstances.
We cannot predict whether or the extent to which the tender offer will be oversubscribed. If the tender offer is oversubscribed, proration of tenders pursuant to the tender offer will cause us to accept fewer shares than are tendered. Therefore, a U.S. Holder can be given no assurance that a sufficient number of such U.S. Holder’s shares will be purchased pursuant to the tender offer to ensure that such purchase will be treated as a sale or exchange, rather than as a distribution, for U.S. federal income tax purposes pursuant to the rules discussed above.
The determination of whether a corporation has current or accumulated earnings or profits is complex, and the legal standards to be applied are subject to uncertainties and ambiguities. Additionally, whether a corporation has current earnings and profits can be determined only at the end of the taxable year. Accordingly, if the sale of shares pursuant to the tender offer is treated as a distribution rather than a sale or exchange under Section 302 of the Code, the extent to which such sale is treated as a dividend may be unclear.
Material U.S. Federal Income Tax Consequences of the Tender Offer to Tendering Non-U.S. Holders.
If a sale by a Non-U.S. Holder of shares pursuant to the tender offer qualifies as a sale or exchange under any of the Section 302 tests described above, then any gain recognized by such Non-U.S. Holder on the sale generally will not be subject to U.S. federal income tax unless (i) such gain is “effectively connected” with a trade or business carried on by the Non-U.S. Holder within the United States (and, if required pursuant to an applicable income tax treaty, is attributable to a permanent establishment of the Non-U.S. Holder within the United States) or (ii) the Non-U.S. Holder is an individual who is physically present in the United States for 183 days or more during the taxable year of the sale and certain other conditions are met. If the gain is described in clause (i) above, the gain generally will be subject to U.S. federal income tax on a net income basis, in the same manner as if the Non-U.S. Holder were a resident of the United States. A Non-U.S. Holder that is a corporation may be subject to an additional “branch profits tax” at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) with respect to any effectively connected earnings and profits (subject to certain adjustments). A Non-U.S. Holder described in clause (ii) above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) on the gain derived from the sale, which may be offset by certain U.S. source capital losses, even though the Non-U.S. Holder is not considered a resident of the United States.
If the repurchase of shares pursuant to the tender offer from a Non-U.S. Holder does not satisfy any of the Section 302 tests described above, amounts received by such Non-U.S. Holder pursuant to the tender offer will be treated as a distribution to the Non-U.S. Holder with respect to such Non-U.S. Holder’s shares. The treatment for U.S. federal income tax purposes of such distribution as a dividend, return of capital, or as gain from the sale of shares will be determined in the manner described above under “Material U.S. Federal Income Tax Consequences of the Tender Offer to Tendering U.S. Holders.” In general, any amount that constitutes a dividend for U.S. federal income tax purposes will be subject to U.S. withholding tax at a rate of 30% (or such lower rate
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as may be specified pursuant to an applicable income tax treaty) unless the dividend is “effectively connected” with a trade or business conducted by the Non-U.S. Holder within the United States (and, if required pursuant to an applicable income tax treaty, is attributable to a permanent establishment of the Non-U.S. Holder within the United States), in which case such dividend generally will be subject to U.S. federal income tax on a net income basis, in the same manner as if the Non-U.S. Holder were a resident of the United States. A Non-U.S. Holder that is a corporation may be subject to an additional “branch profits tax” at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) with respect to any effectively connected earnings and profits (subject to certain adjustments).
As discussed in Section 3 above, in order to claim a reduction in the rate of, or an exemption from, the 30% U.S. withholding tax, a Non-U.S. Holder must deliver to the applicable withholding agent a correct, properly completed and executed IRS Form W-8BEN or W-8BEN-E (with respect to income tax treaty benefits) or Form W-8ECI (with respect to amounts effectively connected with the conduct by such Non-U.S. Holder of a trade or business within the United States) claiming such reduced rate or exemption.
Because the satisfaction of the Section 302 tests described above is dependent on matters of fact that are unique to each Non-U.S. Holder, the withholding agents generally will presume, for withholding purposes, that all amounts paid to Non-U.S. Holders pursuant to the tender offer are treated as distributions in respect of their shares. Accordingly, as described in Section 3 above, a Non-U.S. Holder should expect that a withholding agent will likely withhold U.S. federal income tax on the gross proceeds payable to a Non-U.S. Holder pursuant to the tender offer at a rate of 30% unless the Non-U.S. Holder provides the withholding agent with a validly completed and executed IRS Form W-8ECI, W-8BEN or W-8BEN-E reflecting that no or reduced withholding is required. See Section 3 for additional information. If tax has been withheld on amounts paid to a Non-U.S. Holder pursuant to the tender offer, as described above, but the receipt of cash for such Non-U.S. Holder’s tendered shares is in fact properly treated as consideration received in a sale or exchange, then such Non-U.S. Holder may apply for a refund of such withheld amount. Non-U.S. Holders should consult their own tax advisors regarding the particular tax consequences to them of selling shares in the tender offer, including the application of the 30% U.S. federal withholding tax, their potential eligibility for a reduced rate of, or exemption from, such withholding tax, and their potential eligibility for, and procedures for claiming, a refund of any such withholding tax.
Information Reporting and Backup Withholding.
Payments of proceeds pursuant to the tender offer may be subject to information reporting and, as described in Section 3 above, possibly U.S. federal backup withholding (currently at a rate of 24%). Payments of gross proceeds to a U.S. Holder generally will be subject to information reporting. Such payments may also be subject to backup withholding unless the holder provides its correct taxpayer identification number, certifies that it is not subject to backup withholding and otherwise complies with the backup withholding rules. Certain U.S. Holders (including, among others, corporations) are not subject to these information reporting and backup withholding tax rules. Backup withholding generally will not apply to payments of gross proceeds in the tender offer to a Non-U.S. Holder if the Non-U.S. Holder submits a properly completed, applicable IRS Form W-8, signed under penalties of perjury, attesting to such holder’s non-U.S. status and otherwise complies with the backup withholding rules. Backup withholding is not an additional tax. Amounts withheld under the backup withholding rules may be credited against the holder’s U.S. federal income tax liability and may entitle the holder to a refund of any excess amounts withheld, provided that the required information is timely furnished to the IRS. See Section 3 for additional information.
FATCA
Under Sections 1471 through 1474 of the Code, commonly referred to as “FATCA,” and related administrative guidance, a U.S. federal withholding tax of 30% generally will be imposed on dividends that are paid to “foreign financial institutions” and “non-financial foreign entities” (as specifically defined under these rules), whether such institutions or entities hold shares as beneficial owners or intermediaries, unless specified
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requirements are met or an exemption applies. Because, as discussed above, the withholding agents will likely treat all amounts paid to Non-U.S. Holders pursuant to the tender offer as dividends for U.S. federal income tax purposes, such amounts may also be subject to withholding under FATCA if such requirements are not met. In such case, any withholding under FATCA may be credited against, and therefore reduce, any withholding tax otherwise imposed on dividend distributions, as discussed above. Non-U.S. Holders should consult with their tax advisors regarding the possible implications of these rules on their sale of shares pursuant to the tender offer.
The preceding discussion is intended for general information only and is not a complete analysis or discussion of all the potential tax consequences of the disposition of shares in the tender offer, nor is it legal or tax advice. Each holder of shares should consult their own tax advisor to determine its particular tax consequences of selling shares in the tender offer including any tax return reporting requirements and the applicability and effect of U.S. federal, state, local and non-U.S. and other applicable tax laws in light of their particular circumstances.
| 14. | Extension of the Tender Offer; Termination; Amendment. |
We expressly reserve the right, in our sole discretion, at any time and from time to time, and regardless of whether or not any of the events set forth in Section 7 shall have occurred or shall be deemed by us to have occurred, to extend the period of time during which the tender offer is open and thereby delay acceptance for payment of, and payment for, any shares by giving oral or written notice of such extension to the Depositary and making a public announcement of such extension. We also expressly reserve the right, in our sole discretion, to terminate the tender offer and not accept for payment or pay for any shares not theretofore accepted for payment or paid for or, subject to applicable law and regulation, to postpone payment for shares upon the occurrence of any of the conditions specified in Section 7 hereof by giving oral or written notice of such termination or postponement to the Depositary and making a public announcement of such termination or postponement. Our reservation of the right to delay payment for shares which we have accepted for payment is limited by Rule 13e-4(f)(5) promulgated under the Exchange Act, which requires that we must pay the consideration offered or return the shares tendered promptly after termination or withdrawal of the tender offer.
Subject to compliance with applicable law and regulation, we further reserve the right, in our sole discretion, and regardless of whether any of the events set forth in Section 7 shall have occurred or shall be deemed by us to have occurred, to amend the tender offer in any respect, including, without limitation, by decreasing or increasing the consideration offered in the tender offer to holders of shares or by decreasing or increasing the number of shares being sought in the tender offer. Amendments to the tender offer may be made at any time and from time to time effected by public announcement, such announcement, in the case of an extension, to be issued no later than 9:00 a.m., New York City time, on the next business day after the last previously scheduled or announced Expiration Date. Any public announcement made pursuant to the tender offer will be disseminated promptly to stockholders in a manner reasonably designed to inform stockholders of such change. Without limiting the manner in which we may choose to make a public announcement, except as required by applicable law and regulation, we shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by making a release through a newswire service.
If we materially change the terms of the tender offer or the information concerning the tender offer, or if we waive a material condition of the tender offer, we will extend the tender offer to the extent required by Rules 13e-4(d)(2) and 13e4(f)(1) promulgated under the Exchange Act. These rules and certain related releases and interpretations of the Commission provide that the minimum period during which a tender offer must remain open following material changes in the terms of the tender offer or information concerning the tender offer (other than a change in price or a change in percentage of securities sought) will depend on the facts and circumstances, including the relative materiality of such terms or information. As a general matter, if we materially change the terms of the tender offer or the information concerning the tender offer (other than a change in price or a change in percentage of securities sought), including the waiver of a material condition, we are required to extend the tender offer, if necessary, so that the tender offer remains open for at least five business days following such
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change. If (1) we increase the maximum price to be paid for shares above $15.00 or decrease the price to be paid per share below $13.10 per share or otherwise change the price range to be paid for shares or increase or decrease the aggregate purchase price offered for shares being sought in the tender offer (but, in the case of an increase, only if we increase the aggregate purchase price as a result of which the number of shares being sought will increase by more than 2% of our outstanding shares) and (2) the tender offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that such notice of an increase or decrease is first published, sent or given to stockholders in the manner specified in this Section 14, the tender offer will be extended until the expiration of such period of ten business days.
| 15. | Fees and Expenses; Information Agent; Dealer Managers; Depositary. |
We have retained J.P. Morgan Securities LLC and Goldman Sachs & Co. LLC to act as Dealer Managers, D.F. King & Co. Inc. to act as Information Agent and Computershare Trust Company, N.A. to act as Depositary in connection with the tender offer. The Dealer Managers and Information Agent may contact holders of shares by mail, e-mail, telephone and in person and may request brokers, dealers, commercial banks, trust companies and other nominee stockholders to forward materials relating to the tender offer to beneficial owners. The Dealer Managers, the Information Agent and the Depositary will each receive reasonable and customary compensation for their respective services, will be reimbursed by us for specified reasonable out-of-pocket expenses and will be indemnified against certain liabilities in connection with the tender offer, including certain liabilities under the federal securities laws.
We will not pay any fees or commissions to brokers or dealers (other than fees to the Dealer Managers or Information Agent as described above) for soliciting tenders of shares pursuant to the tender offer or for making any recommendation in connection with the tender offer. Stockholders holding shares through brokers, dealers, commercial banks, trust companies or other nominees are urged to consult such nominees to determine whether transaction costs are applicable if stockholders tender shares through such nominees and not directly to the Depositary. We will, however, upon request, reimburse brokers, dealers, commercial banks, trust companies and other nominees for customary mailing and handling expenses incurred by them in forwarding the tender offer and related materials to the beneficial owners of shares held by them as a nominee or in a fiduciary capacity. No broker, dealer, commercial bank, trust company or other nominee has been authorized to act as the agent of us, the Dealer Managers, the Information Agent or the Depositary for purposes of the tender offer. We will pay or cause to be paid all stock transfer taxes, if any, on our purchase of shares except as otherwise provided in this document and the Letter of Transmittal.
The Dealer Managers and their respective affiliates have provided, and may in the future provide, various investment banking and other services to us for which they have received, or we expect they will receive, customary compensation from us.
The Dealer Managers and their affiliates in the ordinary course of their respective businesses may purchase and/or sell our securities, including the shares, for their respective own accounts and for the account of their respective customers. As a result, the Dealer Managers and their affiliates at any time may own certain of our securities, including the shares. In addition, the Dealer Managers and their affiliates may tender shares into the tender offer for their respective own accounts and for the account of their respective customers.
| 16. | Miscellaneous. |
We are not aware of any jurisdiction where the making of the tender offer is not in compliance with applicable law and regulation. If we become aware of any jurisdiction where the making of the tender offer or the acceptance of shares pursuant thereto is not in compliance with applicable law and regulation, we will make a good faith effort to comply with the applicable law and regulation. If, after such good faith effort, we cannot comply with the applicable law and regulation, the tender offer will not be made to the holders of shares in such jurisdiction, provided that we will comply with the requirements of Rule 13e-4(f)(8) promulgated under the
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Exchange Act. In any jurisdiction where the securities, blue sky or other laws require the tender offer to be made by a licensed broker or dealer, the tender offer shall be deemed to be made on our behalf by one or more registered brokers or dealers licensed under the laws of that jurisdiction.
Pursuant to Rule 13e-4 under the Exchange Act, we have filed with the Commission a Tender Offer Statement on Schedule TO, which contains additional information with respect to the tender offer. The Schedule TO, including the exhibits and any amendments and supplements thereto, may be examined, and copies may be obtained, at the same places and in the same manner as is set forth in Section 10 with respect to information concerning us.
WE HAVE NOT MADE ANY RECOMMENDATION AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES IN THE TENDER OFFER. WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON OUR BEHALF AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES IN THE TENDER OFFER. WE HAVE NOT AUTHORIZED ANY PERSON TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE TENDER OFFER OTHER THAN THOSE CONTAINED IN THIS DOCUMENT OR DOCUMENTS INCORPORATED BY REFERENCE OR IN THE RELATED LETTER OF TRANSMITTAL. IF GIVEN OR MADE, ANY RECOMMENDATION OR ANY SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY US, THE DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY OR ANY OF OUR OR THEIR RESPECTIVE AFFILIATES.
SLM Corporation
February 2, 2021
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The Letter of Transmittal and certificates for shares and any other required documents should be sent or delivered by each stockholder or such stockholder’s broker, dealer, commercial bank, trust company or other nominee to the Depositary at its address set forth below.
The Depositary for the Tender Offer is:
Computershare Trust Company, N.A.
150 Royall Street, Suite V
Canton, MA 02021
DELIVERY OF THE LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY.
Questions or requests for assistance may be directed to the Information Agent at its telephone number and address set forth below. Requests for additional copies of the Offer to Purchase, the related Letter of Transmittal, the Notice of Guaranteed Delivery or the other tender offer materials may be directed to the Information Agent at the telephone number and address set forth below. Stockholders may also contact their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the tender offer. To confirm delivery of shares, stockholders are directed to contact the Depositary.
The Dealer Managers for the Tender Offer are:
| J.P. Morgan Securities LLC | Goldman Sachs & Co. LLC | |
| 383 Madison Ave, 6th Floor New York, NY 10179 U.S. Toll Free: (877) 371-5947 |
200 West Street New York, New York 10282 Attn: Equity Derivatives Group Collect: (800) 323-5678 Toll-Free: (212) 902-1000 | |
The Information Agent for the Tender Offer is:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Attention: Corporate Actions
Banks and Brokers call: (212) 269-5550
or
Call Toll-Free: (877) 283-0322
Email: slm@dfking.com
Exhibit (a)(1)(ii)
LETTER OF TRANSMITTAL
To Tender Shares of Common Stock
Pursuant to the Offer to Purchase Dated February 2, 2021
by
SLM CORPORATION
of
Up to $1,000,000,000 in Value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and Not More Than $15.00 Per Share
THE TENDER OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021, UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN.
Mail or deliver this Letter of Transmittal, together with any certificate(s) representing your shares, to:
Computershare Trust Company, N.A.
| By First Class: Computershare Trust Company, N.A. c/o Voluntary Corporate Actions P.O. Box 43011 Providence, RI 02940-3011 |
By Registered, Certified or Overnight Courier: Computershare Trust Company, N.A. c/o Voluntary Corporate Actions 150 Royall Street, Suite V Canton, MA 02021 |
Description of Shares Tendered
| Name(s) and Address(es) of Registered Owner(s) (If blank, please fill in exactly as name(s) appear(s) on Share Certificate(s)) |
Shares Tendered (Attach additional list if necessary) | |||||||
| Certificate Number(s) and/or indicate Book- Entry |
Total Number of Shares Represented by Certificate(s) (1) |
Book-Entry Shares Tendered (2) |
Total Number of Shares Tendered | |||||
| Total Shares | ||||||||
| (1) | If you wish to tender fewer than all shares represented by any certificate listed above, please indicate in this column the number of shares you wish to tender. Otherwise, all Shares represented by Share Certificates delivered to the Depositary Agent will be deemed to have been tendered. See Instruction 4. |
| (2) | If shares are held in Book-Entry form you must indicate the number of shares you are tendering. |
Delivery of this Letter of Transmittal to an address other than as set forth above will not constitute a valid delivery to Computershare Trust Company, N.A. (the “Depositary”) and the information agent for the tender offer, D.F. King & Co., Inc. (the “Information Agent”). Deliveries to SLM Corporation (the “Company”), J.P. Morgan Securities LLC or Goldman Sachs & Co. LLC, the dealer managers for the tender offer (the “Dealer Managers”) or to The Depository Trust Company (“DTC,” which is hereinafter referred to as the “Book-Entry Transfer Facility”) will not be forwarded to the Depositary and therefore will not constitute valid delivery to the Depositary. All of the instructions set forth in this Letter of Transmittal should be read carefully before this Letter of Transmittal is completed.
This Letter of Transmittal is to be used only if certificates for shares are to be forwarded herewith or if shares are held in book-entry form on the records of the Depositary.
Please note the following:
1. If you want to participate in the tender offer and wish to maximize the chance of having the Company accept for payment shares you are tendering, you should check the box marked “Shares Tendered at Price Determined Pursuant to the Tender Offer” below and complete the other portions of this Letter of Transmittal as appropriate. If you agree to accept the Purchase Price determined by the Company in accordance with the terms of the tender offer, your shares will be deemed to be tendered at the minimum price of $13.10 per share. YOU SHOULD UNDERSTAND THAT THIS ELECTION MAY LOWER THE PURCHASE PRICE AND COULD RESULT IN THE TENDERED SHARES BEING PURCHASED AT THE MINIMUM PRICE OF $13.10 PER SHARE, A PRICE THAT IS BELOW THE CLOSING PRICE FOR THE SHARES ON FEBRUARY 1, 2021, THE LAST FULL TRADING DAY BEFORE ANNOUNCEMENT AND COMMENCEMENT OF THE TENDER OFFER AND COULD BE BELOW THE CLOSING PRICE OF THE COMMON STOCK ON THE EXPIRATION DATE.
2. If you wish to select a specific price at which you will be tendering your shares, you should select one of the boxes in the section captioned “SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER” below and complete the other portions of this Letter of Transmittal as appropriate.
3. If you desire to tender shares in the tender offer, but you cannot deliver your shares and all other required documents to the Depositary by the Expiration Date (as defined in the Offer to Purchase) or cannot comply with the procedures for book-entry transfer on a timely basis, you must tender your shares pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. See Instruction 2.
4. If any certificate evidencing the shares you are tendering with this Letter of Transmittal has been lost, stolen, destroyed or mutilated you should call Computershare Trust Company, N.A., as Depositary, at 1-877-373-6374, regarding the requirements for replacement. You may be required to post a bond to secure against the risk that the certificates may be subsequently recirculated. You are urged to contact the Depositary immediately in order to receive further instructions, for a determination of whether you will need to post a bond and to permit timely processing of this documentation. See Instruction 13.
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THE UNDERSIGNED IS TENDERING SHARES AS FOLLOWS (CHECK ONLY ONE BOX):
| (1) | SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER (SEE INSTRUCTION 5) |
By checking ONE of the following boxes below INSTEAD OF THE BOX UNDER “SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER,” the undersigned tenders shares at the price checked. This action could result in none of the shares tendered hereby being purchased if the Purchase Price determined by the Company in accordance with the terms of the tender offer is less than the price checked below. A STOCKHOLDER WHO DESIRES TO TENDER DIFFERENT SHARES AT DIFFERENT PRICES MUST COMPLETE A SEPARATE LETTER OF TRANSMITTAL FOR EACH TENDER. The same shares cannot be tendered at more than one price, unless previously properly withdrawn as provided in Section 4 of the Offer to Purchase.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
CHECK ONLY ONE BOX
IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS CHECKED,
THERE IS NO PROPER TENDER OF SHARES
| ☐ $13.10 | ☐ $13.20 | ☐ $13.30 | ☐ $13.40 | ☐ $13.50 | ☐ $13.60 | ☐ $13.70 | ☐ $13.80 | ☐ $13.90 | ☐ $14.00 | |||||||||
| ☐ $14.10 | ☐ $14.20 | ☐ $14.30 | ☐ $14.40 | ☐ $14.50 | ☐ $14.60 | ☐ $14.70 | ☐ $14.80 | ☐ $14.90 | ☐ $15.00 |
–OR–
| (2) | SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER (SEE INSTRUCTION 5) |
By checking the box below INSTEAD OF ONE OF THE BOXES UNDER “SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER,” the undersigned tenders shares at the Purchase Price, as shall be determined by the Company in accordance with the terms of the tender offer. For purposes of determining the Purchase Price, those shares that are tendered by the undersigned agreeing to accept the Purchase Price determined in the tender offer will be deemed to be tendered at the minimum price of $13.10 per share.
| ☐ | The undersigned wants to maximize the chance of having the Company purchase shares the undersigned is tendering (subject to the proration and priority provisions of the tender offer). Accordingly, by checking this box instead of one of the price boxes above, the undersigned hereby tenders shares at, and is willing to accept, the Purchase Price determined by the Company in accordance with the terms of the tender offer. THE UNDERSIGNED UNDERSTANDS THAT THIS ELECTION MAY LOWER THE PURCHASE PRICE PAID FOR SHARES IN THE TENDER OFFER AND COULD RESULT IN THE TENDERED SHARES BEING PURCHASED AT THE MINIMUM PRICE OF $13.10 PER SHARE, A PRICE THAT IS BELOW THE CLOSING PRICE FOR THE SHARES ON FEBRUARY 1, 2021, THE LAST FULL TRADING DAY BEFORE ANNOUNCEMENT AND COMMENCEMENT OF THE TENDER OFFER AND COULD BE BELOW THE CLOSING PRICE OF THE COMMON STOCK ON THE EXPIRATION DATE. |
CHECK ONLY ONE BOX UNDER (1) OR (2) ABOVE. IF MORE THAN ONE BOX IS CHECKED ABOVE, OR IF NO BOX IS CHECKED, THERE IS NO VALID TENDER OF SHARES.
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NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
ODD LOTS
(See Instruction 6)
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. The undersigned (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 (i) is tendering, on behalf of the beneficial owner(s), shares with respect to which it is the record holder and (ii) believes, based upon representations made to it by the beneficial owner(s) of such Shares, that each such person is the beneficial owner of an aggregate of fewer than 100 shares and is tendering all such shares. |
CONDITIONAL TENDER
(See Instruction 14)
A tendering stockholder may condition his, her or its tender of shares upon the Company purchasing a specified minimum number of the shares tendered, all as described in Section 6 of the Offer to Purchase. Unless at least the minimum number of shares that you indicate below is purchased by the Company pursuant to the terms of the tender offer, none of the shares tendered will be purchased. It is the tendering stockholder’s responsibility to calculate the minimum number of shares that must be purchased if any are purchased, and each stockholder is urged to consult his, her or its own tax advisor. Unless this box has been checked and a minimum specified, your tender will be deemed unconditional.
| ☐ | The minimum number of shares that must be purchased, if any are purchased, is: shares. |
If, because of proration, the minimum number of shares designated will not be purchased, the Company may accept conditional tenders by random lot, if necessary. However, to be eligible for purchase by random lot, the tendering stockholder must have tendered all of his, her or its shares and checked the box below:
| ☐ | The tendered shares represent all shares held by the undersigned. |
| SPECIAL PAYMENT INSTRUCTIONS (See Instructions 1, 7, 8 and 9)
To be completed ONLY if the check for the Purchase Price of shares purchased (less any applicable withholding taxes) is to be issued in the name of someone other than the undersigned. |
|
SPECIAL DELIVERY INSTRUCTIONS
To be completed ONLY if the check for the Purchase Price of shares purchased (less any applicable withholding taxes) is to be mailed to someone other than the undersigned or to the undersigned at an address other than that shown below the undersigned’s signature(s). | ||
| Name | Name | |||
| (Please Print) | (Please Print) | |||
| Address | Address | |||
| (RECIPIENT MUST COMPLETE AND RETURN THE ATTACHED IRS FORM W-9 OR AN APPLICABLE IRS FORM W-8) | ||||
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SIGN HERE
(Please also complete the attached IRS Form W-9 or an applicable IRS Form W-8)
(Must be signed by registered holder(s) exactly as name(s) appear(s) on stock certificate(s) or on a security position listing or by persons(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, agent, officer of a corporation or other person acting in a fiduciary or representative capacity, please set forth full title and see Instruction 7.)
Signature of Owner:
Signature of Owner:
| Name(s): | ||
| (Please Print) | ||
Dated:
| Capacity (full title): |
| Address: | ||
(MAKE ANY ADDRESS CORRECTION, THIS WILL BE A PERMANENT ADDRESS CHANGE) APPLY MEDALLION GUARANTEE STAMP BELOW
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Ladies and Gentlemen:
The undersigned hereby tenders to SLM Corporation, a Delaware corporation (the “Company”), the above-described shares of Common Stock, $0.20 par value per share (the “shares”), upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 1, 2021 (as it may be amended or supplemented from time to time, the “Offer to Purchase”), receipt of which is hereby acknowledged, which collectively with this Letter of Transmittal, as amended or supplemented from time to time, constitute the “tender offer”. The Company also expressly reserves the right, in its sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements.
Subject to, and effective upon, acceptance for payment of and payment for the shares tendered herewith, the undersigned hereby sells, assigns and transfers to or upon the order of the Company all right, title and interest in and to all the shares that are being tendered hereby, to:
| (1) | deliver certificates for such shares, or transfer ownership of such shares on the account books maintained by the Book-Entry Transfer Facility, together, in any such case, with all accompanying evidences of transfer and authenticity, to or upon the order of the Company; |
| (2) | present such shares for transfer and cancellation on the books of the Company; and |
| (3) | cause the Company to receive all benefits and otherwise exercise all rights of beneficial ownership of such shares, all in accordance with the terms of the tender offer. |
The undersigned understands, upon the terms and subject to the conditions of the tender offer, the Company will determine a single per share purchase price (the “Purchase Price”), which will not be less than $13.10 per share and not more than $15.00 per share, that will allow it to purchase a number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. The undersigned understands that the Company will select the lowest Purchase Price (in increments of $0.10) within the price range specified above that will allow the Company to purchase that number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer, at a price which will be not less than $13.10 per share and not more than $15.00 per share in the tender offer, subject to its right to increase the total number of shares purchased to the extent permitted by law and regulation. The undersigned understands that all shares properly tendered at prices at or below the Purchase Price and not properly withdrawn will be purchased at the Purchase Price, less any applicable withholding taxes and without interest, upon the terms and subject to the conditions of the tender offer, including its proration provisions, “odd lot” provisions and conditional tender provisions. The Company will return at its expense all other shares, including shares tendered at prices greater than the Purchase Price and not properly withdrawn and shares not purchased because of proration or conditional tenders, promptly following the Expiration Date (as defined in the Offer to Purchase).
The undersigned hereby represents and warrants that the undersigned:
| (1) | has a net long position in shares at least equal to the number of shares being tendered; |
| (2) | has full power and authority to tender, sell, assign and transfer the shares tendered hereby and that, when the same are accepted for payment by the Company, the Company will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claims; and |
| (3) | will, upon request, execute and deliver all additional documents deemed by the Depositary or the Company to be necessary or desirable to complete the sale, assignment and transfer of the shares tendered hereby. |
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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 hereto will constitute an agreement between the undersigned and the Company upon the terms and subject to the conditions of the tender offer, which agreement will be governed by, and construed in accordance with, the laws of the State of New York. The undersigned acknowledges that under no circumstances will the Company pay interest on the Purchase Price.
The undersigned recognizes that, under certain circumstances set forth in the Offer to Purchase, the Company may terminate or amend the tender 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.
Unless otherwise indicated under “Special Payment Instructions,” please issue the check for the Purchase Price of any shares purchased (less any applicable withholding taxes), and return any shares not tendered or not purchased, in the name(s) of the undersigned. Similarly, unless otherwise indicated under “Special Delivery Instructions,” please mail the check for the Purchase Price of any shares purchased (less any applicable withholding taxes) and any certificates for shares not tendered or not purchased to the undersigned at the address shown below the undersigned’s signature(s). In the event that both “Special Payment Instructions” and “Special Delivery Instructions” are completed, please issue the check for the Purchase Price of any shares purchased (less any applicable withholding taxes) and return any shares not tendered or not purchased in the name(s) of, and mail said check and any certificates to, the person(s) so indicated.
The undersigned recognizes that the Company has no obligation, pursuant to the “Special Payment Instructions,” to transfer any shares from the name of the registered holder(s) thereof, if the Company does not accept for payment any of the shares so tendered.
All authority herein conferred or agreed to be conferred shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.
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INSTRUCTIONS
Forming Part of the Terms and Conditions of the Tender 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 exactly as the name of the registered holder appears on the certificate(s) for the shares tendered with this Letter of Transmittal or (b) in the case of book-entry shares, on the records of the Depositary, and payment and delivery are to be made directly to such registered holder and such registered holder has not completed the box entitled “Special Payment Instructions”. See Instruction 7.
2. Delivery of Letter of Transmittal and Shares; Guaranteed Delivery Procedure. You must use this Letter of Transmittal to forward certificates for shares and to tender any/all shares held in book-entry form on the records of the Depositary (or if the certificates will be delivered pursuant to a Notice of Guaranteed Delivery previously sent to the Depositary). Certificates for all physically tendered shares along with a properly completed and duly executed Letter of Transmittal, including any required signature guarantees, and any other documents required by this Letter of Transmittal, should be mailed or delivered to the Depositary at the appropriate address set forth herein and must be delivered to the Depositary on or before the Expiration Date.
LETTERS OF TRANSMITTAL MUST BE RECEIVED IN THE OFFICE OF THE DEPOSITARY BY 12:00 MIDNIGHT, AT THE END OF THE DAY, ON THE EXPIRATION DATE OF THE OFFER. GUARANTEED DELIVERIES FROM ELIGIBLE INSTITUTIONS WILL BE ACCEPTED VIA EMAIL UNTIL THE EXPIRATION TIME OF THE OFFER ON EXPIRATION DATE.
Guaranteed Delivery. If you cannot deliver your shares and all other required documents to the Depositary by the Expiration Date or the procedure for book-entry transfer cannot be completed on a timely basis, you must tender your shares pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. Pursuant to such procedure:
(a) such tender must be made by or through an Eligible Institution;
(b) a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form provided by the Company must be received by the Depositary by the Expiration Date, including (where required) a signature guarantee by an Eligible Institution in the form set forth in the Notice of Guaranteed Delivery; and
(c) the certificates for all physically delivered shares, or a confirmation of a book-entry transfer of all shares delivered electronically into the Depositary’s account at the Book-Entry Transfer Facility, together with a properly completed and duly executed Letter of Transmittal with any required signature guarantees or an Agent’s Message and any other documents required by this Letter of Transmittal, must be received by the Depositary within two trading days after the Expiration Date, all as provided in Section 3 of the Offer to Purchase.
The method of delivery of all documents, including share certificates, is at your option and risk. If you choose to deliver the documents by mail, then registered mail with return receipt requested, properly insured, is recommended. In all cases, sufficient time should be allowed to ensure timely delivery.
Except as specifically permitted by Section 6 of the Offer to Purchase, the Company will not accept any alternative, conditional or contingent tenders, and no fractional shares will be purchased. By executing this Letter of Transmittal, you waive any right to receive any notice of the acceptance for payment of the shares.
3. Inadequate Space. If the space provided in the box captioned “Description of Shares Tendered” is inadequate, then you should list the certificate numbers and/or the number of shares on a separate signed schedule attached hereto.
4. Partial Tenders. If you wish to tender fewer than all of the shares represented by any certificates that you deliver to the Depositary, fill in the number of shares which are to be tendered in the box entitled “Number of
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Shares Tendered.” In such case, a new certificate for the remainder of the shares represented by the old certificate will be sent to the person(s) signing this Letter of Transmittal, unless otherwise provided in the appropriate box on this Letter of Transmittal, as promptly as practicable after the expiration or termination of the tender offer. Unless you indicate otherwise, all shares represented by certificates delivered to the Depositary will be deemed to have been tendered. In the case of shares tendered by book-entry transfer at the Book-Entry Transfer Facility, the shares will be credited to the appropriate account maintained by the tendering stockholder at the Book-Entry Transfer Facility. In each case, shares will be returned or credited without expense to the stockholder.
5. Indication of Price at Which Shares Are Being Tendered. For shares to be properly tendered, the stockholder MUST either (1) check the box indicating the price per share at which such stockholder is tendering shares under the section captioned “Shares Tendered at Price Determined by Stockholder” or (2) check the box in the section captioned “Shares Tendered at Price Determined Pursuant to the Tender Offer” in order to maximize the chance of having the Company purchase the shares tendered (subject to the proration and priority provisions). For purposes of determining the Purchase Price, shares that are tendered by stockholders agreeing to accept the Purchase Price determined in the tender offer will be deemed to be tendered at the minimum price of $13.10 per share. Selecting option (1) could result in none of the stockholder’s tendered shares being purchased if the Purchase Price for the shares turns out to be less than the price selected by the stockholder. Selecting option (2) may lower the Purchase Price paid for shares in the tender offer and could result in the stockholder receiving the minimum price of $13.10 per share. Only one box under (1) or (2) may be checked. If more than one box is checked, or if no box is checked, there is no proper tender of shares. A stockholder wishing to tender portions of such stockholder’s share holdings at different prices must complete a separate Letter of Transmittal for each price at which such stockholder wishes to tender each such portion of such stockholder’s shares. The same shares cannot be tendered at more than one price, unless previously properly withdrawn as provided in Section 4 of the Offer to Purchase.
6. Odd Lots. As described in Section 1 of the Offer to Purchase, if the Company purchases less than all shares tendered and not withdrawn before the Expiration Date, the shares purchased first will consist of all shares tendered by any stockholder who owns, beneficially or of record, an aggregate of fewer than 100 shares and who tenders all of such shares. Even if you otherwise qualify for the “odd lot” preferential treatment, you will not receive such preferential treatment unless you complete the box captioned “Odd Lots” in this Letter of Transmittal and, if applicable, in the Notice of Guaranteed Delivery.
7. Signatures on Letter of Transmittal; Stock Powers and Endorsements.
(a) Exact Signatures. If this Letter of Transmittal is signed by the registered holder(s) of the shares tendered hereby, the signature(s) must correspond with the name(s) as written on the face of the certificates without alteration, enlargement or any change whatsoever.
(b) Joint Holders. If any of the shares tendered hereby are held of record by two or more persons, all such persons must sign this Letter of Transmittal.
(c) Different Names on Certificates. If any of the shares tendered hereby are registered in different names on different certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of certificates.
(d) Endorsements. If this Letter of Transmittal is signed by the registered holder(s) of the shares tendered hereby, no endorsements of certificates or separate stock powers are required unless payment of the Purchase Price is to be made, or shares not tendered or not purchased are to be returned, in the name of any person other than the registered holder(s). Signatures on any such certificates or stock powers must be guaranteed by an Eligible Institution.
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If this Letter of Transmittal is signed by a person other than the registered holder(s) of the shares tendered hereby, certificates must be endorsed or accompanied by appropriate stock powers, in either case, signed exactly as the name(s) of the registered holder(s) appear(s) on the certificates for such shares. Signature(s) on any such certificates or stock powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal or any certificate or stock power is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to the Depositary of the authority of such person so to act must be submitted.
8. Stock Transfer Taxes. Except as provided in this Instruction 8, the Company will pay all stock transfer taxes, if any, payable on the transfer of any shares to the Company pursuant to the tender offer. If, however, payment of proceeds in respect of any shares purchased is to be made to, or shares not tendered or not purchased are to be returned in the name of, any person other than the registered holder(s), or tendered shares are registered in the name of any person other than the name of the person(s) signing this Letter of Transmittal, the amount of any stock transfer taxes (whether imposed on the registered holder(s), such other person or otherwise) payable on account of the transfer to such other person must be paid by the tendering Stockholder.
9. Special Payment and Delivery Instructions. If the check for the Purchase Price of any shares purchased is to be issued and any shares not tendered or not purchased are to be returned, in the name of a person other than the person(s) signing this Letter of Transmittal or if the check and any certificates for shares not tendered or not purchased are to be mailed to someone other than the person(s) signing this Letter of Transmittal or to the person(s) signing this Letter of Transmittal at an address other than that shown above, the boxes captioned “Special Delivery Instructions” and/or “Special Payment Instructions” on this Letter of Transmittal should be completed. Transfer taxes may apply if either the box captioned “Special Delivery Instructions” or “Special Payment Instructions” on this Letter of Transmittal is completed. See Instruction 8. There may be other tax implications resulting from the transfers, please consult your own tax advisor.
10. Withholding. Under U.S. federal income tax laws, the Depositary may be required to withhold (as backup withholding) a portion of the amount of any payments made to certain stockholders or other payees pursuant to the tender offer. In order to avoid such backup withholding (currently at a rate of 24%), each tendering stockholder or payee that is a United States person (for U.S. federal income tax purposes), must provide the Depositary with such stockholder’s or payee’s correct taxpayer identification number and certify that such stockholder or payee is not subject to such backup withholding by completing the attached IRS Form W-9. Certain stockholders or payees (including, among others, corporations and certain foreign persons) are not subject to these backup withholding requirements. Exempt stockholders or other payees that are United States persons (for U.S. federal income tax purposes) should indicate their exempt status on the attached IRS Form W-9.
A tendering stockholder or other payee that is a foreign person (for U.S. federal income tax purposes) should complete, sign, and submit to the Depositary the appropriate IRS Form W-8 in order to establish an exemption from backup withholding. An IRS Form W-8 may be obtained from the Depositary or downloaded from the Internal Revenue Service’s website at http://www.irs.gov. Failure to complete the IRS Form W-9 or the appropriate IRS Form W-8 will not, by itself, cause shares to be deemed invalidly tendered, but may require the Depositary to withhold a portion of the amount otherwise payable pursuant to the tender offer.
As described in the Offer to Purchase, a tendering stockholder or other payee that is a foreign person (for U.S. federal income tax purposes) must provide to the Depositary a properly completed and executed appropriate IRS Form W-8 and any other required documentation in order to establish that it is exempt from, or entitled to a reduced rate of, U.S. federal withholding tax with respect to payments of gross proceeds pursuant to the tender offer. Stockholders or other payees that are foreign persons (for U.S. federal income tax purposes) should consult their own tax advisors regarding the particular tax consequences to them of selling shares pursuant to the tender offer.
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11. Irregularities. The Company will determine all questions as to Purchase Price, the form of documents and the validity, eligibility (including time of receipt) and acceptance for payment of any tender of shares. The Company reserves the 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 the Company’s counsel, be unlawful. The Company also reserves the right to waive any defect or irregularity in the tender of any particular shares. No tender of shares will be deemed to be properly made until all defects and irregularities have been cured or waived. Unless waived, any defects or irregularities in connection with tenders must be cured within such time as the Company shall determine. None of the Company, the Dealer Managers, the Information Agent, the Depositary or any other person is or will be under any duty to give notification of any defect or irregularity in tenders, and none of them will incur any liability for failure to give any such notice.
12. Requests for Assistance or Additional Copies. Questions and requests for assistance or additional copies of the Offer to Purchase and this Letter of Transmittal should be directed to the Dealer Managers or the Information Agent at its address and telephone number set forth below.
13. Lost, Stolen, Destroyed or Mutilated Certificates. If your certificate or certificates for part or all of your shares has been lost, stolen, destroyed or mutilated, you should call Computershare Trust Company, N.A., as Depositary, at 1-877-373-6374 or outside U.S. 1-781-575-2879 regarding the requirements for replacement at the address set forth on the cover page of this Letter of Transmittal. You may be required to post a bond to secure against the risk that the certificates may be subsequently recirculated. You are urged to contact the Depositary immediately in order to receive further instructions, for a determination as to whether you will need to post a bond and to permit timely processing of this documentation.
14. Conditional Tenders. As described in Sections 1 and 6 of the Offer to Purchase, stockholders may condition their tenders on all or a minimum number of their tendered shares being purchased. If you wish to make a conditional tender, you must indicate this in the box captioned “Conditional Tender” in this Letter of Transmittal or, if applicable, the Notice of Guaranteed Delivery. In the box in this Letter of Transmittal or the Notice of Guaranteed Delivery, you must calculate and appropriately indicate the minimum number of shares that must be purchased if any are to be purchased.
As discussed in Sections 1 and 6 of the Offer to Purchase, proration may affect whether the Company accepts conditional tenders and may result in shares tendered pursuant to a conditional tender being deemed withdrawn if the minimum number of shares would not be purchased. If, because of proration, the minimum number of shares that you designate will not be purchased, the Company may accept conditional tenders by random lot, if necessary. However, to be eligible for purchase by random lot, you must have tendered all your shares and check the box so indicating. Upon selection by random lot, if any, the Company will limit its purchase in each case to the designated minimum number of shares. To be eligible for purchase by random lot, stockholders whose shares are conditionally tendered must have tendered all of their shares.
All tendered shares will be deemed unconditionally tendered unless the “Conditional Tender” box is completed. If you are an “odd lot” holder and you tender all of your shares, you cannot conditionally tender, since your shares will not be subject to proration. Each stockholder is urged to consult his, her or its own tax advisor.
IMPORTANT: THIS LETTER OF TRANSMITTAL, PROPERLY COMPLETED AND DULY EXECUTED, TOGETHER WITH CERTIFICATES REPRESENTING SHARES BEING TENDERED (OR CONFIRMATION OF BOOK-ENTRY TRANSFER) AND ALL OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BEFORE 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON THE EXPIRATION DATE, OR THE TENDERING STOCKHOLDER MUST COMPLY WITH THE PROCEDURES FOR GUARANTEED DELIVERY.
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| Form W-9 (Rev. October 2018) Department of the Treasury Internal Revenue Service |
Request for Taxpayer Identification Number and Certification
u Go to www.irs.gov/FormW9 for instructions and the latest information. |
Give Form to the requester. Do not |
| Print or type. See Specific Instructions on page 3.
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1 Name (as shown on your income tax return). Name is required on this line; do not leave this line blank.
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| 2 Business name/disregarded entity name, if different from above
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| 3 Check appropriate box for federal tax classification of the person whose name is entered on line 1. Check only one of the following seven boxes.
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4 Exemptions (codes apply only to certain entities, not individuals; see instructions on page 3): | |||||||||||||||||||||||||
| ☐ | Individual/sole proprietor or
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☐ | C Corporation
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☐ | S Corporation
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☐ | Partnership
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☐ | Trust/estate
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Exempt payee code (if any) | ||||||||||||||||
| ☐ Limited liability company. Enter the tax classification (C=C corporation, S=S corporation, P=Partnership) u
Note: Check the appropriate box in the line above for the tax classification of the single-member owner. Do not check LLC if the LLC is classified as a single-member LLC that is disregarded from the owner unless the owner of the LLC is another LLC that is not disregarded from the owner for U.S. federal tax purposes. Otherwise, a single-member LLC that is disregarded from the owner should check the appropriate box for the tax classification of its owner. |
Exemption from FATCA reporting code (if any)
(Applies to accounts maintained outside the U.S.)
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| ☐ Other (see instructions) u
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| 5 Address (number, street, and apt. or suite no.) See instructions.
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Requester’s name and address (optional) | |||||||||||||||||||||||||
| 6 City, state, and ZIP code
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| 7 List account number(s) here (optional)
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| Part I | Taxpayer Identification Number (TIN) |
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Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid backup withholding. For individuals, this is generally your social security number (SSN). However, for a resident alien, sole proprietor, or disregarded entity, see the instructions for Part I, later. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN, later.
Note: If the account is in more than one name, see the instructions for line 1. Also see What Name and Number To Give the Requester for guidelines on whose number to enter. |
Social security number
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| – | – | |||||||||||||||||||||
| or | ||||||||||||||||||||||
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Employer identification number
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| Part II | Certification |
Under penalties of perjury, I certify that:
| 1. | The number shown on this form is my correct 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, or (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; and |
| 3. | I am a U.S. citizen or other U.S. person (defined below); and |
| 4. | The FATCA code(s) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct. |
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 because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions for Part II, later.
| Sign Here |
Signature of U.S. person u |
Date u |
| Cat. No. 10231X | Form W-9 (Rev. 10-2018) |
| Form W-9 (Rev. 10-2018) |
Page 2 |
| Form W-9 (Rev. 10-2018) |
Page 3 |
| Form W-9 (Rev. 10-2018) |
Page 4 |
| Form W-9 (Rev. 10-2018) |
Page 5 |
Privacy Act Notice
Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with the IRS to report interest, dividends, or certain other income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS, reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District of Columbia, and U.S. commonwealths and possessions for use in administering their laws. The information also may be disclosed to other countries under a treaty, to federal and state agencies to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividend, and certain other payments to a payee who does not give a TIN to the payer. Certain penalties may also apply for providing false or fraudulent information.
Any questions or requests for assistance may be directed to the Information Agent or the Dealer Managers at their respective telephone numbers and addresses set forth below. Requests for additional copies of the Offer to Purchase, this Letter of Transmittal, the Notice of Guaranteed Delivery or related documents may be directed to the Information Agent at its telephone numbers or address set forth below. You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance concerning the tender offer.
The Dealer Managers for the Tender Offer are:
| J.P. Morgan Securities LLC |
Goldman Sachs & Co. LLC | |
| 383 Madison Ave, 6th Floor New York, NY 10179 U.S. Toll Free: (877) 371-5947 |
200 West Street New York, New York 10282 Attn: Equity Derivatives Group Collect: (800) 323-5678 Toll-Free: (212) 902-1000 | |
The Information Agent for the Tender Offer is:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Attention: Corporate Actions
Banks and Brokers call: (212) 269-5550
or
Call Toll-Free: (877) 283-0322
Email: slm@dfking.com
Exhibit (a)(1)(iii)
NOTICE OF GUARANTEED DELIVERY
(Not to Be Used For Signature Guarantee)
To Tender Shares of Common Stock
Pursuant to the Offer to Purchase Dated February 2, 2021
by
SLM CORPORATION
of
Up to $1,000,000,000 in Value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and Not More Than $15.00 Per Share
| THE TENDER OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021, UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN. |
As set forth in Section 3 of the Offer to Purchase (as defined below), this form, or a form substantially equivalent to this form, must be used to accept the tender offer (as defined below) if (1) certificates for shares of common stock, $0.20 par value per share, of SLM Corporation and all other documents required by the Letter of Transmittal (the “Letter of Transmittal”) cannot be delivered to the Depositary by the Expiration Date (as defined in the Offer to Purchase) or (2) the procedures for book-entry transfer cannot be completed on a timely basis. This form may be delivered by email or overnight mail to the Depositary. See Section 3 of the Offer to Purchase.
The Depositary for the Tender Offer is: Computershare Trust Company, N.A.
| By First Class Mail: C/O Voluntary Corporate Actions P.O. Box 43011 Providence, RI 02940-3011 |
By Registered, Certified or Overnight Courier: C/O Voluntary Corporate Actions 150 Royall Street, Suite V Canton, MA 02021 |
If delivering by email: canoticeofguarantee@computershare.com
This email address can ONLY be used for delivering Notices of Guarantee by eligible institutions.
Delivery of this Notice of Guaranteed Delivery or of other instructions to an address or email address, other than those shown above, does not constitute a valid delivery. Deliveries to the Company, the Dealer Managers, the Information Agent or the Book-Entry Transfer Facility (as each is defined in the Offer to Purchase) will not constitute valid delivery to the Depositary.
This Notice of Guaranteed Delivery is not to be used to guarantee signatures. If a signature on a Letter of Transmittal is required to be guaranteed by an “Eligible Institution” under the instructions thereto, such signature guarantee must appear in the applicable space provided in the signature box on the Letter of Transmittal.
The Eligible Institution that completes this form must communicate the guarantee to the Depositary and must deliver the Letter of Transmittal or an Agent’s Message (as defined in the Offer to Purchase) and certificates for Shares to the Depositary within the time period shown herein. Failure to do so could result in a financial loss to such Eligible Institution.
THE GUARANTEE ON PAGE 6 MUST BE COMPLETED.
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Ladies and Gentlemen:
The undersigned hereby tenders to SLM Corporation (the “Company”), upon the terms and subject to the conditions set forth in the Offer to Purchase dated February 2, 2021 (as it may be amended or supplemented from time to time, the “Offer to Purchase”), the related Letter of Transmittal and the other materials filed as exhibits to the Issuer Tender Offer Statement on Schedule TO-I (collectively, as they may be amended or supplemented from time to time, the “tender offer materials”) receipt of which is hereby acknowledged, the number (indicated below) of shares of common stock, $0.20 par value per share (the “shares”), of the Company, pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. The terms and conditions set forth in the tender offer materials collectively constitute the “tender offer”.
NUMBER OF SHARES BEING TENDERED HEREBY: SHARES
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CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED, THERE IS NO VALID TENDER OF SHARES.
| (1) | SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER |
By checking ONE of the following boxes below INSTEAD OF THE BOX UNDER “SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER,” the undersigned tenders shares at the price checked. This action could result in none of the shares tendered hereby being purchased if the Purchase Price determined by the Company in accordance with the terms of the tender offer is less than the price checked below. A STOCKHOLDER WHO DESIRES TO TENDER DIFFERENT SHARES AT DIFFERENT PRICES MUST COMPLETE A SEPARATE NOTICE OF GUARANTEED DELIVERY OR LETTER OF TRANSMITTAL FOR EACH DIFFERENT TENDER. The same shares cannot be tendered at more than one price, unless previously properly withdrawn as provided in Section 4 of the Offer to Purchase.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
CHECK ONLY ONE BOX
IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS CHECKED,
THERE IS NO PROPER TENDER OF SHARES
| ☐ $13.10 | ☐ $13.20 | ☐ $13.30 | ☐ $13.40 | ☐ $13.50 | ☐ $13.60 | ☐ $13.70 | ☐ $13.80 | ☐ $13.90 | ☐ $14.00 | |||||||||
| ☐ $14.10 | ☐ $14.20 | ☐ $14.30 | ☐ $14.40 | ☐ $14.50 | ☐ $14.60 | ☐ $14.70 | ☐ $14.80 | ☐ $14.90 | ☐ $15.00 |
– OR–
| (2) | SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER |
By checking the box below INSTEAD OF ONE OF THE BOXES UNDER “SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER,” the undersigned tenders shares at the Purchase Price, as shall be determined by the Company in accordance with the terms of the tender offer. For purposes of determining the Purchase Price, those shares that are tendered by the undersigned agreeing to accept the Purchase Price determined in the tender offer will be deemed to be tendered at the minimum price of $13.10 per share.
| ☐ | The undersigned wants to maximize the chance of having the Company purchase shares the undersigned is tendering (subject to the proration and priority provisions of the tender offer). Accordingly, by checking this box instead of one of the price boxes above, the undersigned hereby tenders shares at, and is willing to accept, the Purchase Price determined by the Company in accordance with the terms of the tender offer. THE UNDERSIGNED UNDERSTANDS THAT THIS ELECTION MAY LOWER THE PURCHASE PRICE PAID FOR SHARES IN THE TENDER OFFER AND COULD RESULT IN THE TENDERED SHARES BEING PURCHASED AT THE MINIMUM PRICE OF $13.10 PER SHARE, A PRICE THAT IS BELOW THE CLOSING PRICE FOR THE SHARES ON FEBRUARY 1, 2021, THE LAST FULL TRADING DAY BEFORE ANNOUNCEMENT AND COMMENCEMENT OF THE TENDER OFFER AND COULD BE BELOW THE CLOSING PRICE OF THE COMMON STOCK ON THE EXPIRATION DATE. |
CHECK ONLY ONE BOX UNDER (1) OR (2) ABOVE. IF MORE THAN ONE BOX IS
CHECKED ABOVE, OR IF NO BOX IS CHECKED, THERE IS NO VALID TENDER OF SHARES.
ODD LOTS
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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. The undersigned (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 (i) is tendering, on behalf of the beneficial owner(s), Shares with respect to which it is the record holder and (ii) believes, based upon representations made to it by the beneficial owner(s) of such Shares, that each such person is the beneficial owner of an aggregate of fewer than 100 Shares and is tendering all such Shares. |
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CONDITIONAL TENDER
A tendering stockholder may condition his, her or its tender of shares upon the Company purchasing a specified minimum number of the shares tendered, all as described in Section 6 of the Offer to Purchase. Unless at least the minimum number of shares you indicate below is purchased by the Company pursuant to the terms of the tender offer, none of the shares tendered will be purchased. It is the tendering stockholder’s responsibility to calculate that minimum number of shares that must be purchased if any are purchased, and each stockholder is urged to consult his, her or its own tax advisor. Unless this box has been checked and a minimum specified, your tender will be deemed unconditional.
| ☐ | The minimum number of shares that must be purchased, if any are purchased, is: shares |
If, because of proration, the minimum number of shares designated will not be purchased, the Company may accept conditional tenders by random lot, if necessary. However, to be eligible for purchase by random lot, the tendering stockholder must have tendered all of his or her shares and checked the box below:
| ☐ | The tendered shares represent all shares held by the undersigned. |
Certificate Nos. (if available):
If shares will be tendered by book-entry transfer:
Name of Tendering Institution:
Account No.
SIGN HERE
Signature(s)
Dated: , 2021
Please type or print:
(Names) of Stockholders)
(Address(es))
(Zip Code(s))
(Area Code(s) and Telephone No(s).)
(Taxpayer ID No(s). or Social Security No(s).)
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GUARANTEE
(Not to be used for signature guarantee)
The undersigned, a firm that 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 that is also an “eligible guarantor institution,” as the term is defined in Rule 17Ad-15 (the “Eligible Institution”) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), hereby guarantees that (1) the above named person(s) “own(s)” the shares tendered hereby within the meaning of Rule 14e-4 under the Exchange Act, (2) such tender of shares complies with Rule 14e-4 under the Exchange Act and (3) it will deliver to the Depositary either the certificates representing the shares tendered hereby, in proper form for transfer, or confirmation of book-entry transfer of such shares into the Depositary’s account at DTC, in any such case, together with a properly completed and duly executed Letter of Transmittal or an Agent’s Message (as defined in the Offer to Purchase) in the case of a book-entry transfer, and any required signature guarantees and other documents required by the Letter of Transmittal, within two (2) business days after the Expiration Date (as defined in the Offer to Purchase).
The Eligible Institution that completes this form must communicate the guarantee to the Depositary and must deliver the Letter of Transmittal and certificates for shares to the Depositary within the time period shown herein. Failure to do so could result in financial loss to such Eligible Institution. Participants should notify the Depositary prior to covering through the submission of a physical security directly to the Depositary based on a guaranteed delivery that was submitted via The Depositary Trust Company’s PTOP platform.
(Name of Firm)
(Authorized Signature))
(Name)
(Address)
(Area Code and Telephone No.)
Dated: , 2021
DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK CERTIFICATES MUST BE SENT WITH THE LETTER OF TRANSMITTAL.
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Exhibit (a)(1)(iv)
Offer by
SLM CORPORATION
to Purchase for Cash
Up to $1,000,000,000 in Value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and Not More Than $15.00 Per Share
THE TENDER OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021 UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN.
February 2, 2021
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by SLM Corporation, a Delaware corporation (the “Company”), to act as the Dealer Managers in connection with the offer by the Company to purchase for cash up to $1,000,000,000 in value of shares of its issued and outstanding common stock, $0.20 par value per share (the “shares”), at a price that will be not less than $13.10 per share and not more than $15.00 per share, less any applicable withholding taxes and without interest, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated February 2, 2021 (as it may be amended or supplemented from time to time, the “Offer to Purchase”), the related Letter of Transmittal and the other materials filed as exhibits to the Issuer Tender Offer Statement on Schedule TO-I (collectively, as they may be amended or supplemented from time to time, the “tender offer materials”). The terms and conditions set forth in the tender offer materials collectively constitute the “tender offer”.
Under the tender offer, stockholders of the Company will have the ability to tender all or a portion of their shares at a price per share of not less than $13.10 per share and not more than $15.00 per share. Tendering shareholders may specify a price not less than $13.10 per share and not more than $15.00 per share (in increments of $0.10) at which they are willing to sell their shares pursuant to the tender offer. Based on the number of shares tendered and the prices specified by the tendering stockholders, the Company will determine the single per share purchase price (the “Purchase Price”) within the specified range, that will allow it to purchase a number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. All shares acquired in the tender offer will be acquired at the same Purchase Price regardless of whether the stockholder tendered at a lower price, and the Company will only purchase shares tendered at prices equal to or below the Purchase Price. Upon the terms and subject to the conditions of the tender offer, if shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn prior to the Expiration Date (as defined in the Offer to Purchase), the Company will buy all shares properly tendered and not properly withdrawn. If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price in excess of $1,000,000,000, measured at the maximum price at which such shares were properly tendered, have been properly tendered and not properly withdrawn prior to the Expiration Date, the Company will purchase properly tendered shares on the basis set forth in the Offer to Purchase and the related Letter of Transmittal, including the provisions relating to “odd lot” tenders, proration and conditional tenders.
Shares tendered and not purchased because they were tendered at a price greater than the Purchase Price or because of priority, proration or conditional tenders will be returned, at the Company’s expense, to the stockholders who tendered such shares promptly after the Expiration Date. The Company also expressly reserves
the right, in its sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements. See Section 1 of the Offer to Purchase.
For your information and for forwarding to your clients for whom you hold shares registered in your name or in the name of your nominee, we are enclosing the following documents:
1. Offer to Purchase;
2. Letter of Transmittal for your use and for the information of your clients;
3. Notice of Guaranteed Delivery to be used to accept the tender offer if the shares and all other required documents cannot be delivered to the Depositary by the Expiration Date (as defined in the Offer to Purchase) or if the procedures for book-entry transfer cannot be completed on a timely basis; and
4. A form of letter that you may send to your clients for whose accounts you hold shares registered in your name or in the name of your nominee, with space provided for obtaining such clients’ instructions with regard to the tender offer.
THE COMPANY’S BOARD OF DIRECTORS HAS APPROVED THE TENDER OFFER. HOWEVER, NONE OF THE COMPANY, ITS BOARD OF DIRECTORS, THE DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY, OR ANY OF THEIR RESPECTIVE AFFILIATES MAKES ANY RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING ANY SHARES OR AS TO THE PURCHASE PRICE OR PURCHASES PRICES AT WHICH TO TENDER ANY SHARES. STOCKHOLDERS MUST MAKE THEIR OWN DECISION AS TO WHETHER TO TENDER THEIR SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH TO TENDER SUCH SHARES. IN SO DOING, STOCKHOLDERS SHOULD READ CAREFULLY ALL OF THE INFORMATION IN THE OFFER TO PURCHASE, IN THE RELATED LETTER OF TRANSMITTAL AND IN THE OTHER TENDER OFFER MATERIALS, INCLUDING THE COMPANY’S REASONS FOR MAKING THE TENDER OFFER. SEE SECTION 2 OF THE OFFER TO PURCHASE. NONE OF THE COMPANY’S DIRECTORS OR EXECUTIVE OFFICERS WILL TENDER ANY OF THEIR SHARES IN THE TENDER OFFER. SEE SECTION 11 OF THE OFFER TO PURCHASE.
CERTAIN CONDITIONS TO THE TENDER OFFER ARE DESCRIBED IN SECTION 7 OF THE OFFER TO PURCHASE.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. THE TENDER OFFER, THE PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021, UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN.
For shares to be properly tendered pursuant to the tender offer, either of the following must occur:
| • | the certificates for the shares or confirmation of receipt of the shares under the procedure for book-entr transfer, together with a properly completed and duly executed Letter of Transmittal, including any required signature guarantees, or an “Agent’s Message” (as defined in the Offer to Purchase) in the case of a book-entry transfer, and any other documents required by the Letter of Transmittal, must be received prior to 12:00 midnight, New York City time, in each case, by the end of the day on the Expiration Date by the Depositary at its address set forth on the back cover page of this document; or |
| • | the tendering stockholder must comply with the guaranteed delivery procedures, all in accordance with the Offer to Purchase and the related Letter of Transmittal. |
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The Company will not pay any fees or commissions to any broker or dealer or other person (other than as described in the Offer to Purchase) for soliciting tenders of shares pursuant to the tender offer. The Company will, however, upon request, reimburse brokers, dealers, commercial banks, trust companies and other nominees for reasonable and necessary costs and expenses incurred by them in forwarding materials to their customers. The Company will pay all stock transfer taxes applicable to its purchase of shares pursuant to the tender offer, subject to Instruction 8 of the Letter of Transmittal. No broker, dealer, commercial bank, trust company or other nominee shall be deemed to be either our agent or the agent of the Company or the Depositary for the purpose of the tender offer.
Any inquiries you may have with respect to the tender offer should be addressed to, and additional copies of the enclosed materials may be obtained from, the Dealer Managers or the Information Agent at their respective telephone numbers and addresses set forth on the back cover of the Offer to Purchase.
| Very truly yours, |
| J.P. Morgan Securities LLC |
| Goldman Sachs & Co. LLC |
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON AS AN AGENT OF THE COMPANY, THE DEALER MANAGERS, INFORMATION AGENT, THE DEPOSITARY OR ANY OF THEIR RESPECTIVE AFFILIATES, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE TENDER OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
Enclosures
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Exhibit (a)(1)(v)
Offer by
SLM CORPORATION
to Purchase for Cash
Up to $1,000,000,000 in Value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and Not More Than $15.00 Per Share
THE TENDER OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021, UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN.
February 2, 2021
To our Clients:
Enclosed for your consideration are the Offer to Purchase, dated February 2, 2021 (as it may be amended or supplemented from time to time, the “Offer to Purchase”), the related Letter of Transmittal and the other materials filed as exhibits to the Issuer Tender Offer Statement on Schedule TO-I (collectively, as they may be amended or supplemented from time to time, the “tender offer materials”) in connection with the offer by SLM Corporation, a Delaware corporation (the “Company”), to purchase for cash up to $1,000,000,000 in value of its common stock, $0.20 par value (the “shares”), at a price that will be not less than $13.10 per share and not more than $15.00 per share, less any applicable withholding taxes and without interest. The terms and conditions set forth in the tender offer materials collectively constitute the “tender offer”.
We are the holder of record of shares held for your benefit and account. As such, we are the only ones who can tender your shares pursuant to your instructions. The Letter of Transmittal and the other tender offer materials are furnished to you for your information only and cannot be used by you to tender shares held by us for your account.
The Company will determine the single per share purchase price (the “Purchase Price”) within the specified range that will allow it to purchase a number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. All shares acquired in the tender offer will be acquired at the same Purchase Price regardless of whether the stockholder tendered at a lower price, and the Company will only purchase shares tendered at prices equal to or below the Purchase Price. As described in the Offer to Purchase, if the conditions of the Offer have been satisfied or waived and shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn prior to the Expiration Date (as defined in the Offer to Purchase), the Company will buy all shares properly tendered shares that are not withdrawn.
If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price in excess of $1,000,000,000, measured at the maximum price at which such shares were validly tendered, have been properly tendered and not properly withdrawn prior to the Expiration Date, the Company will purchase shares:
| • | first, from all stockholders of “odd lots” (persons who own fewer than 100 shares) who properly tender all of their shares at or below the Purchase Price and do not properly withdraw them before the Expiration Date; |
| • | second, subject to the conditional tender provisions described in Section 6 of the Offer to Purchase, on a pro rata basis (with appropriate adjustments to avoid the purchase of fractional shares) from all other stockholders who properly tender shares at or below the Purchase Price and do not properly withdraw them before the Expiration Date; and |
| • | third, if necessary to permit the Company to purchase shares having an aggregate purchase price of $1,000,000,000 (or such greater amount as the Company may elect to purchase, subject to applicable law), from holders who have tendered shares at or below the Purchase Price subject to the condition that a specified minimum number of the stockholder’s shares be purchased if any of the stockholder’s shares are purchased in the tender offer (for which the condition was not initially satisfied) by random lot, to the extent feasible. To be eligible for purchase by random lot, stockholders whose shares are conditionally tendered must have properly tendered all of their shares and not properly withdrawn them before the Expiration Date. See Sections 4 and 6 of the Offer to Purchase. |
Shares tendered and not purchased because they were tendered at a price greater than the Purchase Price or because of priority, proration or conditional tenders will be returned, at the Company’s expense, to the stockholders who tendered such shares promptly after the Expiration Date. The Company also expressly reserves the right, in its sole discretion, to purchase additional shares subject to applicable legal and regulatory requirements. See Section 1 of the Offer to Purchase.
We request instructions as to whether you wish us to tender any or all of the shares held by us for your account, and if so, at what price you wish for your shares to be tendered, upon the terms and subject to the conditions of the tender offer set forth in the Offer to Purchase and the related Letter of Transmittal.
Please note carefully the following:
1. The tender offer, the proration period and withdrawal rights expire 12:00 midnight, New York City time, at the end of the day on March 2, 2021 unless the tender offer is extended or earlier withdrawn by the Company.
2. The tender offer is not conditioned upon the receipt of any financing or any minimum number of shares being tendered. The tender offer is, however, subject to certain conditions set forth in the Offer to Purchase. See Section 7 of the Offer to Purchase.
3. The tender offer is for shares with an aggregate purchase price of up to $1,000,000,000. Assuming that the tender offer is fully subscribed, if the Purchase Price per share is equal to the tender offer’s minimum price per share of $13.10 the Company would purchase 76,335,877 shares and if the Purchase Price per share is equal to the tender offer’s maximum price of $15.00 the Company would purchase 66,666,666 shares, representing approximately 20.31% and 17.73%, respectively, of its outstanding shares as of January 27, 2021.
4. Tendering stockholders who are registered stockholders or who tender their shares directly to Computershare Trust Company, N.A., the Depositary, will not be obligated to pay any brokerage commissions or fees to the Company, solicitation fees, or, except as set forth in the Offer to Purchase and the related Letter of Transmittal, stock transfer taxes on the Company’s purchase of shares pursuant to the tender offer.
5. If you hold beneficially or of record an aggregate of fewer than 100 shares, and you instruct us to tender on your behalf all such shares before the Expiration Date at or below the Purchase Price and check the box captioned “Odd Lots” on the attached Instruction Form, the Company will accept all such shares for purchase before proration, if any, of the purchase of other shares properly tendered at or below the Purchase Price and not properly withdrawn pursuant to the tender offer.
6. If you wish to condition your tender upon the purchase of all shares tendered or upon the Company’s purchase of a specified minimum number of the shares which you tender, you may elect to do so and thereby avoid possible proration of your tender. To elect such a condition, complete the section captioned “Conditional Tender” in the attached Instruction Form.
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7. If you wish to have us tender any or all of your shares, please so instruct us by completing, executing, detaching and returning to us the Instruction Form on the detachable part hereof. An envelope to return your instructions to us is enclosed. If you authorize tender of your shares, all such shares will be tendered unless otherwise specified on the Instruction Form.
YOUR PROMPT ACTION IS REQUESTED. YOUR INSTRUCTION FORM SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US TO SUBMIT THE TENDER ON YOUR BEHALF BEFORE THE EXPIRATION OF THE TENDER OFFER.
The tender offer is not being made to holders of shares in any jurisdiction in which the making of the tender offer or acceptance thereof would violate the laws of such jurisdiction. In those jurisdictions the laws of which require that the tender offer be made by a licensed broker or dealer, the tender offer shall be deemed to be made on behalf of the Company by one or more registered brokers or dealers licensed under the laws of such jurisdiction, provided that we will comply with the requirements of Rule 13e-4(f)(8) promulgated under the Exchange Act.
THE COMPANY’S BOARD OF DIRECTORS HAS APPROVED THE TENDER OFFER. HOWEVER, NONE OF THE COMPANY, ITS BOARD OF DIRECTORS, THE DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY, OR ANY OF THEIR RESPECTIVE AFFILIATES MAKES ANY RECOMMENDATION TO YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR SHARES OR AS TO THE PRICE OR PRICES AT WHICH YOU MAY CHOOSE TO TENDER YOUR SHARES. YOU MUST MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH YOU CHOOSE TO TENDER SUCH SHARES. IN SO DOING, YOU SHOULD READ CAREFULLY ALL OF THE INFORMATION IN THE OFFER TO PURCHASE, IN THE RELATED LETTER OF TRANSMITTAL AND IN THE OTHER TENDER OFFER MATERIALS, INCLUDING THE COMPANY’S REASONS FOR MAKING THE TENDER OFFER. SEE SECTION 2 OF THE OFFER TO PURCHASE. NONE OF THE COMPANY’S DIRECTORS OR EXECUTIVE OFFICERS WILL TENDER ANY OF THEIR SHARES IN THE TENDER OFFER. SEE SECTION 11 OF THE OFFER TO PURCHASE.
Enclosures
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INSTRUCTION FORM
With Respect to the Offer by
SLM CORPORATION
To Purchase for Cash
Pursuant to the Offer to Purchase Dated February 2, 2021
Up to $1,000,000,000 in Value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and Not More Than $15.00 Per Share
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer to Purchase dated February 2, 2021 (as it may be amended or supplemented from time to time, the “Offer to Purchase”), the related Letter of Transmittal and the other tender offer materials (which collectively, as amended or supplemented from time to time, constitute the “tender offer”), in connection with the offer by SLM Corporation, a Delaware corporation (the “Company”), to purchase for cash up to $1,000,000,000 in value of shares of its common stock, $0.20 par value (the “shares”), at a price that will be not less than $13.10 per share and not more than $15.00 per share, less any applicable withholding taxes and without interest, upon the terms and subject to the conditions set forth in the tender offer.
The undersigned hereby instruct(s) you to tender to the Company the number of shares indicated below or, if no number is indicated, all shares held by you for the account of the undersigned, upon the terms and subject to the conditions set forth in the tender offer.
NUMBER OF SHARES TO BE TENDERED FOR THE ACCOUNT OF THE UNDERSIGNED: SHARES*
| * | Unless otherwise indicated, it will be assumed that all shares held by us for your account are to be tendered. |
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED, THERE IS NO VALID TENDER OF SHARES.
| (1) | SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER (See Instruction 5 of the Letter of Transmittal) |
By checking ONE of the following boxes below INSTEAD OF THE BOX UNDER “SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER,” the undersigned tenders shares at the price checked. This action could result in none of the shares that are the subject of this Instruction being purchased if the Purchase Price determined by the Company in accordance with the terms of the tender offer is less than the price checked below. A STOCKHOLDER WHO DESIRES TO TENDER DIFFERENT SHARES AT DIFFERENT PRICES MUST COMPLETE A SEPARATE INSTRUCTION FORM FOR EACH TENDER. The same shares cannot be tendered at more than one price, unless previously properly withdrawn as provided in Section 4 of the Offer to Purchase.
PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED
CHECK ONLY ONE BOX
IF MORE THAN ONE BOX IS CHECKED OR IF NO BOX IS CHECKED,
THERE IS NO PROPER TENDER OF SHARES
| ☐ $13.10 | ☐ $13.20 | ☐ $13.30 | ☐ $13.40 | ☐ $13.50 | ☐ $13.60 | ☐ $13.70 | ☐ $13.80 | ☐ $13.90 | ☐ $14.00 | |||||||||
| ☐ $14.10 | ☐ $14.20 | ☐ $14.30 | ☐ $14.40 | ☐ $14.50 | ☐ $14.60 | ☐ $14.70 | ☐ $14.80 | ☐ $14.90 | ☐ $15.00 |
– OR–
| (2) | SHARES TENDERED AT PRICE DETERMINED PURSUANT TO THE TENDER OFFER (See Instruction 5 of the Letter of Transmittal) |
By checking the box below INSTEAD OF ONE OF THE BOXES UNDER “SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER,” the undersigned tenders shares at the Purchase Price, as shall be determined by the Company in accordance with the terms of the tender offer. For purposes of determining the Purchase Price, those shares that are tendered by the undersigned agreeing to accept the Purchase Price determined in the tender offer will be deemed to be tendered at the minimum price of $13.10 per share.
| ☐ | The undersigned wants to maximize the chance of having the Company purchase shares the undersigned is tendering (subject to the proration and priority provisions of the tender offer). Accordingly, by checking this box instead of one of the price boxes above, the undersigned hereby tenders shares at, and is willing to accept, the Purchase Price determined by the Company in accordance with the terms of the tender offer. THE UNDERSIGNED UNDERSTANDS THAT THIS ELECTION MAY LOWER THE PURCHASE PRICE PAID FOR SHARES IN THE TENDER OFFER AND COULD RESULT IN THE TENDERED SHARES BEING PURCHASED AT THE MINIMUM PRICE OF $13.10 PER SHARE, A PRICE THAT IS BELOW THE CLOSING PRICE FOR THE SHARES ON FEBRUARY 1, 2021, THE LAST FULL TRADING DAY BEFORE ANNOUNCEMENT AND COMMENCEMENT OF THE TENDER OFFER AND COULD BE BELOW THE CLOSING PRICE OF THE COMMON STOCK ON THE EXPIRATION DATE. |
CHECK ONLY ONE BOX UNDER (1) OR (2) ABOVE. IF MORE THAN ONE BOX IS CHECKED ABOVE, OR IF NO BOX IS CHECKED, THERE IS NO VALID INSTRUCTION TO
TENDER OF SHARES.
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ODD LOTS
(See Instruction 6 of the Letter of Transmittal)
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 (check one box).
| ☐ | By checking this box, the undersigned represents that it is the beneficial or record owner of an aggregate of fewer than 100 shares, all of which are being tendered. |
| ☐ | By checking this box, the undersigned represents that is a broker, dealer, commercial bank, trust company or other nominee that (i) is tendering, on behalf of the beneficial owner(s), Shares with respect to which it is the record holder and (ii) believes, based upon representations made to it by the beneficial owner(s) of such Shares, that each such person is the beneficial owner of an aggregate of fewer than 100 Shares and is tendering all such Shares. |
CONDITIONAL TENDER
(See Instruction 14 of the Letter of Transmittal)
A tendering stockholder may condition his, her or its tender of shares upon the Company purchasing a specified minimum number of the shares tendered, all as described in Section 6 of the Offer to Purchase. Unless at least the minimum number of shares you indicate below is purchased by the Company pursuant to the terms of the tender offer, none of the shares tendered will be purchased. It is the tendering stockholder’s responsibility to calculate that minimum number of shares that must be purchased if any are purchased, and each stockholder is urged to consult his, her or its own tax advisor. Unless this box has been checked and a minimum specified, your tender will be deemed unconditional.
| ☐ | The minimum number of shares that must be purchased, if any are purchased, is: shares |
If, because of proration, the minimum number of shares designated will not be purchased, the Company may accept conditional tenders by random lot, if necessary. However, to be eligible for purchase by random lot, the tendering stockholder must have tendered all of his, her or its shares and checked the box below:
| ☐ | The tendered shares represent all shares held by the undersigned. |
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE ELECTION AND RISK OF THE TENDERING STOCKHOLDER. IF DELIVERY IS BY MAIL, THEN REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
SIGN HERE
| Signature(s):
|
| Name(s):
|
| (PLEASE PRINT) |
| Taxpayer Identification Number or Social Security Number:
|
| Address(es), Including Zip Code:
|
| Area Code(s)/Phone Number(s):
|
| Date:
|
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Exhibit (a)(1)(vi)
This announcement is neither an offer to purchase nor a solicitation of an offer to sell shares of SLM Corporation. The tender offer (as defined below) is made solely by the Offer to Purchase, dated February 2, 2021, and the related Letter of Transmittal, and any amendments or supplements thereto. The tender offer is not being made to holders of shares in any jurisdiction in which the making or acceptance of offers would not be in compliance with the laws of that jurisdiction, provided that the Company (as defined below) will comply with the requirements of Rule 13e-4(f)(8) promulgated under the U.S. Securities and Exchange Act of 1934, as amended. If the Company becomes aware of any such jurisdiction where the making of the tender offer or the acceptance of shares pursuant to the tender offer is not in compliance with applicable law, the Company will make a good faith effort to comply with the applicable law. If, after such good faith effort, the Company cannot comply with the applicable law, the tender offer will not be made to the holders of shares in such jurisdiction. In any jurisdictions where the securities, blue sky or other laws require that the tender offer be made by a licensed broker or dealer, the tender offer shall be deemed to be made on behalf of the Company by one or more registered brokers or dealers licensed under the laws of that jurisdiction.
Notice of Offer to Purchase for Cash
by
SLM Corporation
of
Up to $1,000,000,000 in value of its Common Stock
At a Purchase Price Not Less Than $13.10 Per Share and
Not More Than $15.00 Per Share
SLM Corporation, a Delaware corporation (the “Company,” “we,” “us,” or “our”), hereby offers to purchase for cash up to $1,000,000,000 in value of shares of its issued and outstanding common stock, par value $0.20 per share (the “shares”), at a price which will not be less than $13.10 and not more than $15.00 per share (the price as determined as provided herein, the “Purchase Price”), less any applicable withholding taxes and without interest, upon the terms and subject to the conditions set forth in the Offer to Purchase, the related Letter of Transmittal and the other materials filed as exhibits to the Issuer Tender Offer Statement on Schedule TO-I (collectively, as they may be amended or supplemented from time to time, the “tender offer materials”). The terms and conditions set forth in the tender offer materials collectively constitute the “tender offer.”
THE TENDER OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, AT THE END OF THE DAY ON MARCH 2, 2021, UNLESS THE TENDER OFFER IS EXTENDED OR WITHDRAWN (SUCH DATE AND TIME, AS THEY MAY BE EXTENDED, THE “EXPIRATION DATE”).
The tender offer is not conditioned upon the receipt of any financing or any minimum number of shares being tendered. The tender offer is, however, subject to other conditions described in the Offer to Purchase.
Upon the terms and subject to the conditions of the tender offer, including the provisions relating to “odd lot” priority, proration and conditional tenders described in the Offer to Purchase, the Company will determine a single per share price (the “Purchase Price”) that the Company will pay for shares properly tendered and not properly withdrawn from the tender offer, taking into account the total number of shares tendered and the prices specified by tendering stockholders. The Company will select the lowest Purchase Price (in increments of $0.10), which will not be less than $13.10 per share and not more than $15.00 per share, that will allow it to purchase that number of shares having an aggregate purchase price of $1,000,000,000, or a lower amount depending on the number of shares properly tendered and not properly withdrawn pursuant to the tender offer. Upon the terms and subject to the conditions of the tender offer, if shares having an aggregate purchase price of less than $1,000,000,000 are properly tendered and not properly withdrawn, the Company will buy all shares properly tendered and not properly withdrawn prior to the Expiration Date. If the conditions to the tender offer have been satisfied or waived and shares having an aggregate purchase price in excess of $1,000,000,000, measured at the
maximum price at which such shares were properly tendered, have been properly tendered and not properly withdrawn prior to the Expiration Date, the Company will purchase shares in the following priority:
| • | first, from all holders of “odd lots” (holders of fewer than 100 shares) who properly tender all their shares at or below the Purchase Price and do not properly withdraw them before the Expiration Date; |
| • | second, on a pro rata basis (with appropriate adjustments to avoid the purchase of fractional shares) from all other stockholders who properly tender shares at or below the Purchase Price and do not properly withdraw them prior to the Expiration Date, other than stockholders who tender conditionally and whose conditions are not satisfied; and |
| • | third, if necessary to permit the Company to purchase shares having an aggregate purchase price of $1,000,000,000 (or such greater amount as the Company may elect to purchase, subject to applicable law), from stockholders who have tendered shares at or below the Purchase Price subject to the condition that a specified minimum number of the stockholder’s shares be purchased if any of the stockholder’s shares are purchased in the tender offer (for which the condition was not initially satisfied) by random lot, to the extent feasible. To be eligible for purchase by random lot, stockholders whose shares are conditionally tendered must have tendered all of their shares and not properly withdrawn them prior to the Expiration Date. |
If shares having an aggregate purchase price of more than $1,000,000,000 are properly tendered in the tender offer and not properly withdrawn, the Company reserves the right to accept for purchase at the Purchase Price up to an additional 2% of our outstanding common stock without amending or extending the offer. All shares tendered and not purchased will be returned to stockholders at the Company’s expense promptly after the Expiration Date.
Assuming that the conditions to the tender offer are satisfied or waived and the tender offer is fully subscribed, if the Purchase Price per share is $13.10, the Company would purchase 76,355,877 shares and if the Purchase Price per share is $15.00 the Company would purchase 66,666,666 shares, representing approximately 20.31% and 17.73%, respectively, of its outstanding shares as of January 27, 2021. The actual number of shares outstanding immediately following completion of the tender offer will depend on the number of shares tendered and purchased in the tender offer as well as the Purchase Price for such shares. The shares are listed and traded on the NASDAQ under the trading symbol “SLM.” Shareholders are urged to obtain current market quotations for the shares before deciding whether and at what price or prices to tender their shares.
The Company expressly reserves the right to extend the tender offer at any time and from time to time by oral or written notice to the Depositary (as defined in the Offer to Purchase) and by making a public announcement of such extension, in which event the term “Expiration Date” shall mean the latest time and date to which the tender offer, as so extended by the Company, shall expire. During any such extension, all shares previously tendered and not properly withdrawn will remain subject to the tender offer and to the right of the tendering stockholder to withdraw such stockholder’s shares.
Stockholders wishing to tender their shares must follow the procedures set forth in Section 3 of the Offer to Purchase and in the Letter of Transmittal. Stockholders wishing to tender their shares but who are unable to deliver them physically or by book-entry transfer prior to the Expiration Date, or who are unable to make delivery of all required documents to the Depositary prior to the Expiration Date, may tender their shares by complying with the procedures set forth in Section 3 of the Offer to Purchase for tendering by Notice of Guaranteed Delivery. The proration period is the period for accepting shares on a pro rata basis in the event that the tender offer is oversubscribed. The proration period will expire at the Expiration Date.
Tenders of shares made pursuant to the tender offer may be withdrawn at any time prior to the Expiration Date, and unless previously accepted for payment as provided in the Offer to Purchase, may be withdrawn after 12:00 midnight, New York City time, at the end of the day on March 2, 2021. To be effective, a written notice of withdrawal must be timely received by the Depositary at one of its addresses set forth on the back cover of the
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Offer to Purchase and must specify the name of the person who tendered the shares to be withdrawn, the number of shares to be withdrawn, and the name of the registered holder of the shares, if different from that of the person who tendered such shares. If the shares to be withdrawn have been delivered to the Depositary, a signed notice of withdrawal with signatures guaranteed by an Eligible Institution (as defined in the Offer to Purchase) must be submitted prior to the release of such shares. In addition, such notice must specify, in the case of shares tendered by delivery of certificates, the name of the registered holder (if different from that of the tendering stockholder) and the serial numbers shown on the particular certificates evidencing the shares to be withdrawn or, in the case of shares tendered by book-entry transfer, the name and number of the account at the Book-Entry Transfer Facility (as defined in the Offer to Purchase) to be credited with the withdrawn shares.
For purposes of the tender offer, the Company will be deemed to have accepted for payment, subject to the “odd lot” priority, proration and conditional tender provisions of the tender offer, shares that are properly tendered at or below the Purchase Price and not properly withdrawn, only when, as and if the Company gives oral or written notice to the Depositary of its acceptance of the shares for payment pursuant to the tender offer.
Payment for shares tendered and accepted for payment pursuant to the tender offer will be made only after timely receipt by the Depositary of certificates for such shares or a timely confirmation of a book-entry transfer of such shares into the Depositary’s account at the Book-Entry Transfer Facility, a properly completed and duly executed Letter of Transmittal with any required signature guarantees, or an Agent’s Message (as defined in the Offer to Purchase) in connection with book-entry delivery, and any other documents required by the Letter of Transmittal.
The Company’s Board of Directors has determined that it is in the best interests of the Company to repurchase shares of its common stock and that at this time the tender offer is a prudent and effective way to do so and to provide value and increased liquidity to stockholders. In particular, the Company’s Board of Directors believes the modified “Dutch auction” tender offer is a mechanism that will provide all stockholders with the opportunity to tender all or a portion of their shares (subject to “odd lot” priority, proration and conditional tenders). Conversely, the tender offer also affords stockholders the option not to participate and, thereby, to increase their relative percentage interest in the Company and its future results.
The Company’s Board of Directors has approved the tender offer. However, none of the Company, its Board of Directors, the Dealer Managers, the Information Agent, the Depositary or any of their respective affiliates makes any recommendation to any stockholder whether to tender or refrain from tendering any or all shares or as to the Purchase Price or Purchase Prices at which stockholders may choose to tender their shares. Stockholders must make their own decision whether to tender shares and, if so, how many shares to tender and the price or prices at which they will tender those shares. None of the Company’s directors and executive officers will tender any of their shares in the tender offer.
The receipt of cash by stockholders for tendered shares purchased by the Company in the tender offer will generally be treated for U.S. federal income tax purposes either as a sale or exchange eligible for capital gain or loss treatment or a distribution. Stockholders are strongly encouraged to read the Offer to Purchase for additional information regarding the U.S. federal income tax consequences of participating in the tender offer and to consult their tax advisors.
The information required to be disclosed by Rule 13e-4(d)(1) under the U.S. Securities Exchange Act of 1934, as amended, is contained in the Offer to Purchase and the Schedule TO, both of which are incorporated herein by reference.
The Offer to Purchase and the related Letter of Transmittal contain important information that should be read before any decision is made with respect to the tender offer.
Questions or requests for assistance may be directed to the Information Agent at its telephone number and address set forth below. Requests for additional copies of the Offer to Purchase, the related Letter of Transmittal, the Notice of Guaranteed Delivery or the other tender offer materials may be directed to the Information Agent at
the telephone number and address set forth below. Stockholders may also contact their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the tender offer. To confirm delivery of shares, stockholders are directed to contact the Information Agent.
The Dealer Managers for the Tender Offer are:
| J.P. Morgan J.P. Morgan Securities LLC 383 Madison Avenue New York, New York 10179 Toll-Free: (877) 371-5947 |
Goldman Sachs Goldman Sachs & Co. LLC 200 West Street New York, New York 10282 Attn: Equity Derivatives Group Collect: (800) 323-5678 Toll-Free: (212) 902-1000 |
The Information Agent for the Tender Offer is:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Attention: Corporate Actions
Banks and Brokers call: (212) 269-5550
or
Call Toll-Free: (877) 283-0322
Email: slm@dfking.com
February 2, 2021
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