EXHIBIT 1.2
EXECUTION VERSION
PRICING AGREEMENT
CREDIT SUISSE FIRST BOSTON CORPORATION
ELEVEN XXXXXXX XXXXXX
XXX XXXX, XXX XXXX 00000-0000
CREDIT SUISSE FIRST BOSTON(EUROPE) LIMITED
ONE XXXXX XXXXXX
XXXXXX X00 0XX
AND
XXXXXXX XXXXX XXXXXX INC.
000 XXXXXXXXX XXXXXX
XXX XXXX, XXX XXXX 00000
AS REPRESENTATIVES OF THE SEVERAL
UNDERWRITERS NAMED ON SCHEDULE I HERETO
NOVEMBER 20, 2002
Ladies and Gentlemen:
SLM Funding Corporation, a Delaware corporation (the "Company"), and the
Student Loan Marketing Association, a corporation formed under the laws of the
United States ("Xxxxxx Mae"), propose, subject to the terms and conditions
stated herein and in the Underwriting Agreement, dated November 20, 2002 (the
"Underwriting Agreement"), between the Company and Xxxxxx Xxx, on the one hand,
and Credit Suisse First Boston Corporation, Credit Suisse First Boston (Europe)
Limited and Xxxxxxx Xxxxx Barney Inc., on the other hand, that the Company will
cause the trust (the "Trust") formed pursuant to the Trust Agreement dated as of
November 1, 2002 between the Company and Chase Manhattan Bank USA, National
Association, as trustee (the "Eligible Lender Trustee"), to 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 November 1, 2002 (the "Indenture"), between the Trust and The Bank
of New York, as trustee (the "Indenture Trustee").
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 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 the Representatives and
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 principal amount of Designated Securities set forth
opposite the name of such Underwriter in Schedule I hereto, less the principal
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 November 26, 2002, the
Company agrees, and Xxxxxx Xxx agrees that it will cause the Company, not to,
and not to permit any affiliated entity to, offer, sell, contract to sell or
otherwise dispose of, any securities (other than the Designated Securities)
collateralized by, or any securities (other than the related Certificates)
evidencing an ownership in, Student Loans, other than any auction rate
securities on their respective auction dates, 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; (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, with
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 Notes in
circumstances in which section 21(1) of the FSMA does not apply to the Company;
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. The Company
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represents and agrees that it has been informed of the existence of the FSA
stabilizing guidance contained in Section MAR 2, Xxx 2G of the FSA Handbook (the
Handbook of rules and guidance issued by the Financial Services Authority).
Credit Suisse First Boston (Europe) Limited, in its capacity as UK
Stabilizing Manager, may, to the extent permitted by applicable laws, over-allot
and effect transactions in any over-the-counter market or otherwise in
connection with the distribution of the Class A-5 Student Loan-Backed Notes (the
"Euro Notes") with a view to supporting the market price of the Euro Notes at
levels higher than those which might otherwise prevail in the open market, but
in doing so it shall not act as agent of the Company and any loss resulting from
over-allotment or stabilization will be borne, and any profit arising from them
shall be retained, by the UK Stabilizing Manager or, as the case may be, the
Underwriters in the manner agreed between them. The Underwriters acknowledge
that the Company has not authorized the issue of Euro Notes in a principal
amount exceeding Euro 500,000,000.
Each Underwriter further represents and agrees that it understands that the
Seller has not taken any action, or will take any action, that would permit a
public offering of the Notes in any country or jurisdiction other than in the
United States, where action for that purpose is required, and the Notes shall
not be offered or sold, directly or indirectly, and neither the Prospectus nor
any circular, prospectus, form of application, advertisement or other material
may be distributed in or from or published in any such country or jurisdiction,
except under circumstances that will result in compliance with any applicable
laws and regulations.
If the foregoing is in accordance with your understanding, please sign and
return to us seven counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, 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 and Xxxxxx Xxx. It is understood that your acceptance of this
letter on behalf of each of the Underwriters 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 and Xxxxxx Mae for examination upon request,
but without warranty on the part of the Representatives as to the authority of
the signers thereof.
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Very truly yours,
SLM FUNDING CORPORATION
By: /s/ XXXX X. XXXXXX
-------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
STUDENT LOAN MARKETING ASSOCIATION
By: /s/ XXXXXX XXXXXXXXXX
----------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Treasurer
Accepted as of the date hereof:
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ XXXXXXXX XXXXX
-------------------
Name: Xxxxxxxx Xxxxx
Title: Director
----------------
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
By: /s/ XXXXXX XXXXXXXXX
------------------------
Name: Xxxxxx Xxxxxxxxx
------------------------
Title: Authorized Signatory
----------------------------
XXXXXXX XXXXX XXXXXX INC.
By: /s/ XXXX X. XXXXXX XX.
---------------------------
Name: Xxxx X. Xxxxxx Xx.
--------------------------
Title: Director
On behalf of each of the Underwriters
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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 A-6
Credit Suisse First Boston Corporation $ 50,367,500 $ 57,350,000 $ 49,615,000 $ 51,735,000 EURO 0 $ 0
Credit Suisse First Boston (Europe)
Limited $ 0 $ 0 $ 0 $ 0 EURO 118,750,000 $ 0
Xxxxxxx Xxxxx Barney, Inc. $ 50,367,500 $ 57,350,000 $ 49,615,000 $ 51,735,000 EURO 118,750,000 $ 94,550,000
Deutsche Bank Securities Inc. $ 50,367,500 $ 57,350,000 $ 49,615,000 $ 51,735,000 EURO 118,750,000 $ 0
Xxxxxx Brothers Inc. $ 50,367,500 $ 57,350,000 $ 49,615,000 $ 51,735,000 EURO 0 $ 0
Xxxxxx Brothers International (Europe) $ 0 $ 0 $ 0 $ 0 EURO 181,750,000 $ 0
Xxxxxxxxxx Xxxx-xxx Xxxxxxxxxxx
Aktingesellschaft $ 0 $ 0 $ 0 $ 0 EURO 25,000,000 $ 0
TOTAL $ 201,470,000 $ 229,400,000 $ 198,460,000 $ 206,940,000 EURO 500,000,000 $ 94,550,000
============= ============= ============= ============= ================ ============
UNDERWRITER CLASS A-7 CLASS A-8 CLASS A-9 CLASS A-10 CLASS A-11 CLASS B
Credit Suisse First Boston Corporation $ 0 $ 0 $ 0 $ 100,000,000 $ 0 $ 0
Credit Suisse First Boston (Europe)
Limited $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Xxxxxxx Xxxxx Xxxxxx, Inc. $ 100,000,000 $ 100,000,000 $ 100,000,000 $ 0 $ 0 $ 59,850,000
Deutsche Bank Securities Inc. $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Xxxxxx Brothers International (Europe) $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Xxxxxx Brothers Inc. $ 0 $ 0 $ 0 $ 0 $ 100,000,000 $ 0
Xxxxxxxxxx Xxxx-xxx Xxxxxxxxxxx
Aktingesellschaft $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
TOTAL $ 100,000,000 $ 100,000,000 $ 100,000,000 $ 100,000,000 $ 100,000,000 $ 59,850,000
============= ============= ============= ============= ================ ============
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")
Auction Rate Class A-6 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-6")
Auction Rate Class A-7 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-7")
Auction Rate Class A-8 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-8")
Auction Rate Class A-9 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-9")
Auction Rate Class A-10 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-10")
Auction Rate Class A-11 Student Loan-Backed Notes
(for purposes of this Schedule II, "Class A-11")
Auction Rate Class B Student Loan-Backed Notes
(for purposes of this Schedule II, "Class B")
AGGREGATE PRINCIPAL AMOUNT OF EACH CLASS:
Class A-1: $ 201,470,000
Class A-2: $ 229,400,000
Class A-3: $ 198,460,000
Class A-4: $ 206,940,000
Class A-5: EURO 500,000,000
Class A-6: $ 94,550,000
Class A-7: $ 100,000,000
Class A-8: $ 100,000,000
Class A-9: $ 100,000,000
Class A-10: $ 100,000,000
Class A-11: $ 100,000,000
Class B: $ 59,850,000
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 A-6: 100.00%
Class A-7: 100.00%
Class A-8: 100.00%
Class A-9: 100.00%
Class A-10: 100.00%
Class A-11: 100.00%
Class B: 100.00%
PURCHASE PRICE BY UNDERWRITERS OF EACH CLASS:
Class A-1: 99.830%
Class A-2: 99.800%
Class A-3: 99.775%
Class A-4: 99.750%
Class A-5: 99.650%
Class A-6: 99.650%
Class A-7: 99.650%
Class A-8: 99.650%
Class A-9: 99.650%
Class A-10: 99.650%
Class A-11: 99.650%
Class B: 99.600%
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE: Same Day Funds
INDENTURE: Indenture, dated as of November 1, 2002, among The Bank of New York,
as Indenture Trustee, the SLM Student Loan Trust 2002-7, and Chase Manhattan
Bank USA, National Association, as Eligible Lender Trustee.
MATURITY:
Class A-1: March 2010 Distribution Date
Class A-2: June 2013 Distribution Date
Class A-3: September 2015 Distribution Date
Class A-4: September 2017 Distribution Date
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Class A-5: September 2021 Distribution Date
Class A-6: March 2028 Distribution Date
Class A-7: March 2028 Distribution Date
Class A-8: March 2028 Distribution Date
Class A-9: March 2028 Distribution Date
Class A-10: March 2028 Distribution Date
Class A-11: March 2028 Distribution Date
Class B: December 2039 Distribution Date
INTEREST RATE:
Class A-1: interpolated 3/4-month LIBOR* plus 0.00%
Class A-2: interpolated 3/4-month LIBOR* plus 0.04%
Class A-3: interpolated 3/4-month LIBOR* plus 0.09%
Class A-4: interpolated 3/4-month LIBOR* plus 0.18%
Class A-5: interpolated 3/4-month EURIBOR* plus 0.27%
Class A-6: auction rate
Class A-7: auction rate
Class A-8: auction rate
Class A-9: auction rate
Class A-10: auction rate
Class A-11: auction rate
Class B: auction rate
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* As to initial Accrual Period; thereafter, Three-month LIBOR or EURIBOR, as
applicable.
FORM OF DESIGNATED SECURITIES: Book-Entry (DTC), except for Class A-5 Notes,
which are Euroclear
TIME OF DELIVERY: November 26, 2002
CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
Student Loan Marketing Association
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, XX 00000
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NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives: Credit Suisse First Boston Corporation
Address for Notices, etc.: Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxxxxx Xxxxx
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