EXHIBIT 1.2
PRICING AGREEMENT
CITIGROUP GLOBAL MARKETS INC.
000 XXXXXXXXX XXXXXX
XXX XXXX, XXX XXXX 00000
XXXXXXX, XXXXX & CO.
00 XXXXX XXXXXX
XXX XXXX, XXX XXXX 00000
AND
XXXXXX BROTHERS INC.
000 0XX XXXXXX
XXX XXXX, XXX XXXX 00000
July 20, 2004
Ladies and Gentlemen:
SLM Funding LLC, a Delaware limited liability company (the
"Company"), and the SLM Education Credit Finance Corporation, a Delaware
corporation ("SLM ECFC"), propose, subject to the terms and conditions stated
herein and in the Underwriting Agreement, dated July 20, 2004 (the "Underwriting
Agreement"), between the Company, SLM ECFC and SLM Corporation, on the one hand,
and Citigroup Global Markets Inc., Xxxxxxx, Xxxxx & Co. and Xxxxxx Brothers
Inc., on the other hand, that the Company, (i) having caused the formation of
the trust (the "Trust") pursuant to a trust agreement, dated of July 9, 2004
(the "Initial Trust Agreement"), between the Company and Chase Manhattan Bank
USA, National Association, as eligible lender trustee (the "Eligible Lender
Trustee"), will cause the Initial Trust Agreement to be amended and restated by
an Amended and Restated Trust Agreement, dated as of the Time of Delivery, among
the Company, the Eligible Lender Trustee and the Indenture Trustee (defined
below) and (ii) will issue and sell to the Underwriters named in Schedule I
hereto (the "Underwriters") the Student Loan-Backed Notes (the "Notes")
specified in Schedule II hereto (the "Designated Securities"). The Notes will be
issued and secured pursuant to the Indenture, dated as of July 1, 2004 (the
"Indenture"), among the Trust, the Eligible Lender Trustee and Deutsche Bank
Trust Company Americas, as trustee (the "Indenture Trustee").
Except as modified pursuant to Schedule II hereto, each of the
provisions of the Underwriting Agreement is incorporated herein by reference in
its entirety, and shall be deemed to be a part of this Pricing Agreement to the
same extent as if such provisions had been set forth in full herein; and each of
the representations and warranties set forth therein shall be deemed to have
been made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Pricing
Agreement in relation to the Prospectus as amended or supplemented relating to
the Designated Securities which are the subject of this Pricing Agreement. Each
reference to the Representatives herein and in the provisions of the
Underwriting Agreement so incorporated by reference shall be deemed to refer to
you. Unless otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined.
The Representatives designated to act on behalf of each of the
Underwriters of the Designated Securities pursuant to Section 12 of the
Underwriting Agreement and the address of the Representatives referred to in
such Section 12 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form to be delivered to you is proposed to be filed with the Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
cause the Trust to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Trust, at
the time and place and at the purchase price to the Underwriters set forth in
Schedule II hereto, the amount of Designated Securities set forth opposite the
name of such Underwriter in Schedule I hereto, less the amount of Designated
Securities covered by Delayed Delivery Contracts, if any, as may be specified in
Schedule II.
During the period beginning from the date of this Pricing Agreement
for the Designated Securities and continuing to and including the Time of
Delivery, the Company agrees, and SLM ECFC agrees that it will cause the
Company, not to, and not to permit any affiliated entity to, offer, sell, or
contract to sell or otherwise dispose of, securities substantially similar to
the Designated Securities (other than the Designated Securities) evidencing an
ownership in, or any securities (other than the related Notes) collateralized
by, Student Loans, without the prior written consent of the Representatives.
Each Underwriter represents and agrees that (a) it has not offered
or sold and will not offer or sell any Notes to persons in the United Kingdom
prior to the expiration of the period of six months from the issue date of the
Notes except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or agent)
for the purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public in the United Kingdom
within the meaning of the Public Offers of Securities Regulations 1995, as
amended; (b) it has only communicated or caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to engage
in investment activity, within the meaning of Section 21 of the Financial
Services and Markets Act 2000 (the "FSMA"), received by it in connection with
the issue or sale of any notes in circumstances in which Section 21(1) of the
FSMA does not apply to the Trust; and (c) it has complied and will comply with
all applicable provisions of the FSMA with respect to anything done by it in
relation to the Notes in, from or otherwise involving the United Kingdom.
If the foregoing is in accordance with your understanding, please
sign and return to us nine counterparts hereof, and upon acceptance hereof by
you, this letter and such acceptance hereof, including the provisions of the
Underwriting Agreement incorporated herein by reference, shall constitute a
binding agreement between each of the Underwriters and the Company, SLM ECFC and
SLM Corporation. It is understood that your acceptance of this letter is or will
be pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company, SLM ECFC and
SLM Corporation for examination upon request, but without warranty on the part
of the Underwriters as to the authority of the signers thereof.
Very truly yours,
SLM FUNDING LLC
By: /s/ J. XXXXX XXXXXX
Name: J. Xxxxx Xxxxxx
Title: Vice President
SLM EDUCATION CREDIT FINANCE
CORPORATION
By: /s/ XXXX X. XXXXX
Name: Xxxx X. Xxxxx
Title: Treasurer
Accepted and agreed with respect to
Sections 8, 10, 12 and 13 of the
Underwriting Agreement:
SLM CORPORATION
By: /s/ X.X. XXXXXXX
Name: X.X. Xxxxxxx
Title: Executive Vice President
Accepted as of the date hereof:
CITIGROUP GLOBAL MARKETS, INC.
By: /s/ XXXX X. XXXXXX, XX.
Name: Xxxx X. Xxxxxx, Xx.
Title: Director
XXXXXXX, XXXXX & CO.
By: /s/ XXXXXXX, SACHS & CO.
(Xxxxxxx, Xxxxx & Co.)
XXXXXX BROTHERS, INC.
By: /s/ XXXXXX XXXXXXX
Name: Xxxxxx Xxxxxxx
Title: Managing Director
SCHEDULE I
AMOUNT OF DESIGNATED SECURITIES TO BE PURCHASED
UNDERWRITER CLASS A-1 CLASS A-2 CLASS A-3 CLASS A-4 CLASS A-5 CLASS B
Citigroup Global Markets Inc. $108,334,000 $146,000,000 $86,666,000 $95,000,000 $52,091,000 $15,095,000
Xxxxxxx, Xxxxx & Co. $108,333,000 $146,000,000 $86,668,000 $95,000,000 $52,091,000 $15,095,000
Xxxxxx Brothers Inc. $108,333,000 $146,000,000 $86,666,000 $95,000,000 $52,091,000 $15,097,000
TOTAL $325,000,000 $438,000,000 $260,000,000 $285,000,000 $156,273,000 $45,287,000
============ ============ ============ ============ ============ ===========
SCHEDULE II
TITLE OF EACH CLASS OF DESIGNATED SECURITIES:
Floating Rate Class A-1 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-1")
Floating Rate Class A-2 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-2")
Floating Rate Class A-3 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-3")
Floating Rate Class A-4 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-4")
Floating Rate Class A-5 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-5")
Floating Rate Class B Student Loan-Backed Notes
(for purposes of this Schedule II, "Class B")
AGGREGATE PRINCIPAL AMOUNT OF EACH CLASS:
Class A-1: $325,000,000
Class A-2: $438,000,000
Class A-3: $260,000,000
Class A-4: $285,000,000
Class A-5: $156,273,000
Class B: $ 45,287,000
PRICE TO PUBLIC OF EACH CLASS:
Class A-1: 100.00%
Class A-2: 100.00%
Class A-3: 100.00%
Class A-4: 100.00%
Class A-5: 100.00%
Class B: 100.00%
PURCHASE PRICE BY UNDERWRITERS OF EACH CLASS:
Class A-1: 99.875%
Class A-2: 99.820%
Class A-3: 99.800%
Class A-4: 99.780%
Class A-5: 99.750%
Class B: 99.710%
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE: Same Day Funds
INDENTURE: Indenture, dated as of July 1, 2004, among Deutsche Bank Trust
Company Americas, as Indenture Trustee, the SLM Student Loan Trust 2004-7, and
Chase Manhattan Bank USA, National Association, as Eligible Lender Trustee.
MATURITY:
Class A-1: October 2009 Distribution Date
Class A-2: October 2012 Distribution Date
Class A-3: April 2014 Distribution Date
Class A-4: January 2017 Distribution Date
Class A-5: January 2020 Distribution Date
Class B: April 2025 Distribution Date
INTEREST RATE:
Class A-1: interpolated 2-month/3-month LIBOR* minus 0.01%
Class A-2: interpolated 2-month/3-month LIBOR* plus 0.03%
Class A-3: interpolated 2-month/3-month LIBOR* plus 0.09%
Class A-4: interpolated 2-month/3-month LIBOR* plus 0.15%
Class A-5: interpolated 2-month/3-month LIBOR* plus 0.17%
Class B: interpolated 2-month/3-month LIBOR* plus 0.36%
--------------
* As to initial Accrual Period; thereafter, Three-month LIBOR.
FORM OF DESIGNATED SECURITIES: Book-Entry (DTC)
TIME OF DELIVERY: July 28, 2004
CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
Xxxxxx Xxx, Inc.
00000 Xxxxxx Xxx Xxxxx
-0-
Xxxxxx, XX 00000
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives: Citibank Global Markets Inc.
Address for Notices, etc.: Citibank Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxx Xxxxxx
Designated Representatives: Xxxxxxx, Sachs & Co.
Address for Notices, etc.: Xxxxxxx, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxx Xxxxx
Designated Representatives: Xxxxxx Brothers Inc.
Address for Notices, etc.: Xxxxxx Brothers Inc.
000 0xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxxx Xxxxx
MODIFICATIONS TO THE UNDERWRITING AGREEMENT (SOLELY FOR THE PURPOSES OF
THIS PRICING AGREEMENT):
1. The following sentence is hereby added to the end of the second
paragraph of the Underwriting Agreement:
In addition, the Trust will enter into an interest rate cap
agreement (the "Interest Rate Cap Agreement") with Xxxxxxx Sachs Mitsui Marine
Derivative Products, L.P. ("GSMMDP").
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2. The following paragraph is hereby added to Section 7 of the
Underwriting Agreement:
(n) The Interest Rate Cap Agreement shall have been entered into
by the Trust and GSMMDP, and the Underwriters shall have received a copy,
addressed to them or on which they are otherwise entitled to rely, of each
opinion of counsel required to be delivered thereunder at or before the Time of
Delivery, and a copy of each certificate required to be delivered thereunder at
or before the Time of Delivery.
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