; and (II) for which the previous program provided substantial preparation; (ii) in the case of a student who has a Federal Pell Grant that is being treated as a loan under paragraph (1) and who meets the requirements of subparagraph (B) of this paragraph, with respect to a subsequent Federal Pell Grant for which the student is eligible and which is awarded beyond such maximum timeframe; or (iii) due to undue hardship, including— (I) active duty military service; (II) the death of a relative of the student; (III) the personal injury or illness of the student; or (IV) other special circumstances as determined by the institution. (B) Requirements In order to qualify for the exception under subparagraph (A)(ii) of this paragraph, a student shall— (i) have a Federal Pell Grant that is being treated as a loan under paragraph (1) for which the student has met the loan repayment obligations for not less than 6 months; and (ii) not be an individual described in paragraph (4)(B). (4) Loss of Federal Pell Grant eligibility (A) Default An individual who is in default of an obligation to repay a Federal Pell Grant that is being treated as a loan under paragraph (1) shall be ineligible to receive a Federal Pell Grant under this section. (B) Second time dropout An individual who has received a Federal Pell Grant for enrollment in a program that is being treated as a loan under paragraph (1), and who leaves such program for a second time (other than for a reason described in clause (i) or (iii) of paragraph (3)(A)), shall be ineligible to receive a Federal Pell Grant under this section. (5) Notice The Secretary shall ensure that each recipient of a Federal Pell Grant receives notice of the terms of this subsection. (6) Record An institution shall keep a record that tracks the progress (including the graduation and default rate) of any student described in paragraph (3)(B) who receives a Federal Pell Grant for enrollment in a program beyond the maximum timeframe for completion of such program. .