Sallie Mae 2013 Annual Report Download - page 20

• the Telephone Consumer Protection Act, which governs communication methods that may be used to
contact customers; and
• the Gramm-Leach-Bliley Act, which governs the ability of financial institutions to disclose nonpublic
information about consumers to non-affiliated third parties.
Employees
At December 31, 2013, we had approximately 7,200 employees, none of which are covered by collective
bargaining agreements.
Reorganization and the Spin-Off
Background
On May 29, 2013, we first announced our intent to separate into two distinct publicly-traded entities — an
education loan management business and a consumer banking business. The education loan management
business will be comprised primarily of our portfolios of education loans not held by Sallie Mae Bank at the
effective date of the Spin-Off, as well as servicing and collection activities on these loans and loans held by third
parties. The consumer banking business, comprised primarily of Sallie Mae Bank and its Private Education Loan
origination business, the Private Education Loans it holds and a related servicing business, will be a consumer
banking franchise with expertise in helping families save, plan and pay for college.
We are in the process of implementing our announced separation of our education loan management business
in a new public company, NewCo, which is to be preceded by a related internal corporate reorganization. In
connection with the Spin-Off, a newly incorporated, publicly-traded holding company, SLM BankCo, will succeed
and continue to operate our consumer banking business through Sallie Mae Bank and Upromise, Inc. and Sallie Mae
Insurance Services. SLM BankCo will continue using the brand name “Sallie Mae” and trade under the symbol
“SLM” on the NASDAQ. NewCo was incorporated under the temporary name “New Corporation.” The actual and
brand name of NewCo will be publicly disclosed prior to the Spin-Off in an amendment to New Corporation’s Form
10 registration statement, which was initially filed with the SEC on December 6, 2013 and subsequently amended
on February 7, 2014, which can be accessed through the SEC’s website at www.sec.gov/edgar. NewCo will trade
under a new symbol on the NASDAQ.
Private education loan origination will continue to be operated out of Sallie Mae Bank as a subsidiary of
SLM BankCo. Sallie Mae Bank was chartered in 2006 and is a Utah industrial bank regulated by the UDFI and
the FDIC. Sallie Mae Bank had total assets of $10.7 billion as of December 31, 2013, $6.7 billion of which were
Private Education Loans and $1.4 billion of which were FFELP Loans.
We have the sole and absolute discretion to determine (and change) the terms of, and whether to proceed with,
the Spin-Off and, if we determine to proceed, to determine the distribution date for the shares of NewCo common
stock to the U.S. holders of our common stock. It is expected that the Spin-Off, if completed, will occur in the first
half of 2014. Our ability to timely effect the Spin-Off is subject to customary conditions, including receipt of a
private letter ruling from the IRS to the effect the Spin-Off will be tax-free to SLM BankCo and our stockholders,
and the effectiveness of the New Corporation registration statement, which was initially filed with the SEC on
December 6, 2013 and subsequently amended on February 7, 2014, which can be accessed through the SEC’s
website at www.sec.gov/edgar. We cannot assure that we will be able to complete the Spin-Off in a timely fashion,
if at all. For these and other reasons, the Spin-Off may not be completed on the terms or timeline contemplated.
Further, if the Spin-Off is completed, we may not achieve the intended results or SLM BankCo may, following the
Spin-Off, not be composed as described herein. Any such difficulties could adversely affect our business, results of
operations or financial condition. Further information on the Spin-Off and SLM BankCo may be contained in our
future filings with the SEC to the extent we determine, in our sole discretion, to provide such information.
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