Exhibit 4.11
REGISTRATION RIGHTS AGREEMENT
DATED AS OF [ ], 2003 BY AND AMONG NELNET, INC.
AND
THE SHAREHOLDERS OF NELNET, INC. SIGNATORY HERETO
REGISTRATION RIGHTS AGREEMENT, dated as of [ ], 2003 (the
"Agreement"), among Nelnet, Inc., a Nebraska corporation (the "Company"), and
the shareholders of the Company signatory hereto.
W I T N E S S E T H :
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WHEREAS, the Company and the Shareholders desire to provide the
Shareholders with rights to register shares of Class A Common Stock (as defined
below) under the Securities Act (as defined below).
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Definitions. The following capitalized terms have the following
meanings:
"Class A Common Stock" means the Company's Class A Common Stock, par
value $0.01 per share.
"Class A Common Stock Equivalent" means any securities of any Person
convertible into or exchangeable or exercisable for Class A Common Stock.
"Class B Common Stock" means the Company's Class B Common Stock, par
value $0.01 per share.
"Code" means the U.S. Internal Revenue Code of 1986, as amended.
"Commission" means the U.S. Securities and Exchange Commission or any
other United States federal agency administering the Securities Act.
"Common Stock" means the Class A Common Stock and the Class B Common
Stock, collectively.
"Common Stock Equivalent" means any securities o f any Person
convertible into or exchangeable or exercisable for Common Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder, as in effect from
time to time.
"Exempt Transfer" means a transfer of shares of Class B Common Stock
that does not result in the automatic conversion of such shares of Class B
Common Stock into shares of Class A Common Stock pursuant to the terms of the
Company's Second Amended and Restated Articles of Incorporation; provided,
however, that no such transfer shall constitute an "Exempt Transfer" unless (a)
the transferee agrees in writing to be bound by this Agreement as if such
transferee were a Shareholder hereunder and (b) the transfer is a transaction
that is exempt from the registration and qualification requirements of federal
and state securities laws and, if reasonably requested, the Company receives an
opinion of counsel reasonably acceptable to the Company that such transfer is
made in compliance with applicable federal and state securities laws.
"Initial Public Offering" means the closing of a underwritten public
offering of Class A Common Stock registered with the Commission under the
Securities Act.
"NASD" means the National Association of Securities Dealers, Inc. and
any successor organization.
"Person" means an individual, corporation, partnership, association,
joint-stock company, trust where the interests of the beneficiaries are
evidenced by a security, unincorporated organization, estate, governmental or
political subdivision thereof or governmental agency.
"Qualified Shareholder" means any Shareholder that is the beneficial
holder of (a) Registrable Securities or (b) in the case of any Registrable
Securities specified in clause (b) of the definition of "Registrable
Securities," Class B Common Stock.
"Registrable Securities" means (a) shares of Class A Common Stock and
(b) shares of Class A Common Stock issuable upon conversion of Class B Common
Stock; provided, however, that a Registrable Security shall cease to be a
Registrable Security at such time that the Registrable Security has been
effectively registered under the Securities Act and disposed of in accordance
with the registration statement covering it or transferred pursuant to Rule 144
under the Securities Act (or any successor provision then in force).
"Registration Statement" means a registration statement provided for in
Section 6 of the Securities Act under which securities are registered under the
Securities Act, together with any preliminary, final or summary prospectus
contained therein, any amendment or supplement thereto, and any document
incorporated by reference therein.
"Securities Act" means the Securities Act of 1933 and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.
"Shareholder" means the shareholders signatory to this Agreement and
any transferee of such shareholder pursuant to an Exempt Transfer.
2. Demand Registration.
(a) Right to Demand. If the Company shall receive a written request
from one or more Qualified Shareholders (a "Demand Registration Notice") that
the Company register with the Commission, under and in accordance with the
provisions of the Securities Act, all or part of their Registrable Securities (a
"Demand Registration"), with respect to Registrable Securities
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that will provide net proceeds, after deduction of underwriting discounts and
commissions, to such Qualified Shareholders of not less than $5.0 million, the
Company shall have twenty-one (21) days to determine whether to file a
registration statement for the offer and sale of securities for its own account.
If during such twenty-one (21) day period, the Company in good faith determines
to undertake or is undertaking such an offering on its own behalf (a "Company
Offering") and to file a registration statement for a Company Offering and
provides written notice to such Qualified Shareholders of such decision, the
Company shall have no obligation to register any Registrable Securities except
pursuant to and in accordance with Section 3 until the completion of such
Company Offering and the request made by such Qualified Shareholders shall not
be counted as a Demand Registration for the purposes of Section 2(a)(iii);
provided, however, that the Company is actively employing in good faith all
reasonable efforts to cause such registration statement for a Company Offering
to become effective. If the Company determines not to undertake a Company
Offering, the Company shall, no later than ten (10) days after the expiration of
such twenty-one (21) day period, send written notice to each Shareholder of such
decision and its intention to comply with the Demand Registration Notice and,
subject to Section 2(c), to include in such registration all Registrable
Securities of Qualified Shareholders with respect to which the Company has
received written requests for inclusion therein within twenty (20) days after
the Company's giving of such notice. Once a Demand Registration Notice has been
delivered by a Qualified Shareholder, no other Demand Registration Notice may be
delivered by any other Qualified Shareholder or be effective until, (x) if the
Company has elected to undertake or is undertaking a Company Offering in
compliance with the foregoing requirements, such Company Offering is completed
or abandoned, or (y) if the Company has not so elected and is not so
undertaking, the delivered Demand Registration Notice has been withdrawn or
ninety (90) days after the effective date of the registration statement relating
to such Demand Registration (or such shorter period as may be agreed to by the
managing underwriter or underwriters). Once a Demand Registration Notice has
been delivered by a Qualified Shareholder, unless it has elected to undertake or
is undertaking a Company Offering in compliance with the foregoing provisions,
the Company will not effect a public sale or distribution of its equity
securities or securities convertible into or exercisable or exchangeable for
such equity securities under the Securities Act after such Demand Registration
Notice has been delivered until (1) such Demand Registration Notice has been
withdrawn or (2) ninety (90) days after the effective date of the registration
statement relating to such Demand Registration (or such shorter period as may be
agreed to by the managing underwriter or underwriters). Any registration that
involves a shelf registration statement shall be deemed one Demand Registration
for the purposes of clause (iii) below. A Demand Registration may be either a
long-form registration or, if the Company is then eligible to use Form S-3, a
short-form registration. All Demand Registrations shall be short-form
registrations whenever the Company is eligible to use any applicable short-form
for registrations. All requests made pursuant to this Section 2(a) will specify
the aggregate number of Registrable Securities requested to be registered and
will also specify the intended methods of disposition thereof; provided,
however, that the Company shall not be obligated to take any action to effect
any such registration, qualification or compliance pursuant to this Section
2(a):
(i) prior to the date which is twelve (12) months following the
effective date of the Initial Public Offering;
(ii) prior to the date which is twelve (12) months following the
date of receipt by the Company of any Demand Registration Notice from a
Qualified Shareholder, pro-
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vided, however, that the Qualified Shareholder has not withdrawn such
Demand Registration Notice;
(iii) after the Company has effected two (2) Demand Registrations
requested by Qualified Shareholders; or
(iv) if the Company shall furnish to the Qualified Shareholders a
certificate, signed by the President of the Company, stating that in
the good faith judgment of the "independent" members of the Board of
Directors of the Company it would be detrimental to best interests of
the Company for a Registration Statement to be filed at such time. In
such event, the Company's obligation to use all reasonable efforts to
register, qualify or comply under this Section 2(a) shall be deferred
for a single period not to exceed ninety (90) days from the date of
receipt of the Demand Registration Notice by the Qualified
Shareholders.
A registration requested pursuant to this Section 2(a) shall not be
deemed to have been effected for purposes of clause (iii) above, (1) unless a
registration statement with respect thereto has become effective (unless the
Demand Registration has been withdrawn by the Qualified Shareholders that gave
the applicable Demand Registration Notice), (2) if the registration statement
does not remain effective for a period of at least ninety (90) days (or, in the
case of a shelf registration statement, nine (9) months) (as applicable, the
"Effective Period") and all of the shares included in such registration have not
been sold prior to the expiration of the Effective Period, (3) if, after it has
become effective, but before all of the shares included in such registration
have been sold prior to the expiration of the Effective Period, such
registration is subject to any stop order, injunction or other order or
requirement of the Commission or any other governmental agency or court that
permanently prevents the sale of the Registrable Securities that were to have
been registered for any reason not attributable to the actions or omissions of
the holders of such Registrable Securities or (4) if the conditions to closing
specified in the purchase agreement or underwriting agreement entered into in
connection with such registration are not satisfied and no such closing occurs,
other than by reason of some act or omission by the holders of the Registrable
Securities that were to have been registered.
(b) Selection of Underwriters. The underwriters of any offering
pursuant to a Demand Registration shall be one or more nationally-recognized
investment banking firms selected by the Qualified Shareholders which requested
such Demand Registration, subject, however, to the Company's approval, which
shall not be unreasonably withheld.
(c) Priority in Demand Registrations. If the managing underwriter
advises the Company in writing that, in its opinion, the number of Registrable
Securities requested to be included in a Demand Registration exceeds what can be
sold in such offering without having a material adverse effect on the success of
the offering (including, without limitation, an adverse impact on the selling
price or the number of Registrable Securities that any participating Qualified
Shareholder may sell within a range acceptable to the Qualified Shareholders
which requested such Demand Registration), then the Company will include in such
Demand Registration the number of Registrable Securities requested to be
included in such Demand Registration which the Company is so advised can be sold
in such offering without having a material adverse effect on the success of such
offering, pro rata among the holders thereof requesting such registration on the
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basis of the number of Registrable Securities requested to be included by such
holders; provided, however, that the Company will include in any Demand
Registration, prior to the inclusion of any Registrable Securities which are not
held by the Qualified Shareholders which requested such Demand Registration, the
number of Registrable Securities which are held by the Qualified Shareholders
which requested such Demand Registration which the Company is so advised can be
sold in such offering, pro rata among such Qualified Shareholders, if necessary.
(d) Withdrawal. A Demand Registration may be withdrawn by (i) the
Qualified Shareholder who requested such demand Registration or (ii) if more
than one Qualified Shareholder requested such Demand Registration, those
Qualified Shareholders holding a majority of the Registrable Securities included
in the Demand Registration Notice without the demand counting as a Demand
Registration hereunder.
3. Piggyback Registration.
(a) Right to Piggyback. Beginning on the date hereof, if the Company at
any time proposes to register any of its Common Stock or Common Stock
Equivalents (the "Piggyback Securities") under the Securities Act (other than
registrations on Form S-4 or S-8 under the Securities Act or the equivalents
thereof) with respect to an underwritten public offering solely for its own
account and the form of Registration Statement to be used may be used for the
registration of Registrable Securities, the Company will give prompt written
notice (a "Piggyback Registration Notice") to all Shareholders upon the earlier
of (i) forty-five (45) days prior to the anticipated filing date or (ii)
promptly following its decision to file or its intent to file such a
registration statement, which notice shall specify the proposed offering price
(or reasonable range thereof), the kind and number of securities to be
registered, the distribution arrangements and such other information at the time
appropriate to include in such notice. Within thirty (30) days after receipt of
a Piggyback Registration Notice, any Qualified Shareholder may, by written
notice to the Company, request the registration by the Company under the
Securities Act of Registrable Securities in connection with such proposed
registration by the Company under the Securities Act of its Piggyback Securities
(a "Piggyback Registration"). Such written notice to the Company shall specify
the Registrable Securities intended to be disposed of by such Qualified
Shareholder. Upon receipt of such request, the Company will use its best efforts
to register under the Securities Act all Registrable Securities which the
Company has been so requested to register, to the extent requisite to permit the
disposition of the Registrable Securities so to be registered; provided,
however, that if at any time after giving notice of its intent to register
Piggyback Securities and before the effective date of the Registration Statement
filed in connection with such Piggyback Registration, the Company determines for
any reason not to register or to delay registration of such Piggyback
securities, the Company may, at its election, give notice of such determination
to the Qualified Shareholder(s), and, thereupon, (1) in the case of a
determination not to register, the Company shall be relieved of its obligation
to register any Registrable Securities in connection with such Piggyback
Registration (but not from its obligation to pay registration expenses pursuant
to Section 5 hereof), and (2) in the case of a determination to delay
registering, the Company may delay registering any Registrable Securities for
the same period as the delay in registering such Piggyback Securities.
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(b) Selection of Underwriters. The underwriters of any offering
pursuant to a Piggyback Registration shall be one or more nationally-recognized
investment banking firms selected by the Company.
(c) Priority in Piggyback Registrations. If the managing underwriter
informs the Company in writing of its judgment that including the Registrable
Securities in the Piggyback Registration creates a substantial risk that the
proceeds or price per unit to be received from such offering might be reduced or
that the number of Registrable Securities to be registered is too large to be
reasonably sold, then the Company will include in such Piggyback Registration,
to the extent of the number which the Company is so advised can be sold in such
offering: first, all Piggyback Securities proposed by the Company to be sold for
its own account; second, such Registrable Securities requested by any Qualified
Shareholder to be included in such Piggyback Registration pro rata on the basis
of the number of shares of such Registrable Securities so proposed to be sold
and so requested to be included and third, such other securities requested by
any other shareholder to be included in such Piggyback Registration pro rata on
the basis of the number of shares of such securities so proposed to be sold and
so requested to be included.
(d) Withdrawal. A request for Piggyback Registration may be withdrawn
by any Qualified Shareholder making such request within ten (10) days before
such Piggyback Registration becomes effective.
4. Registration Procedures.
(a) Company Covenants. Whenever the Company is hereunder required to
use its best efforts to effect the registration under the Securities Act of any
Registrable Securities as provided in Section 2 or 3, the Company will:
(i) prepare and file with the Commission the requisite
Registration Statement to effect such registration and thereafter use
its best efforts to cause such Registration Statement to become
effective, provided that the Company may discontinue any registration
of its securities which are not Registrable Securities (and, under the
circumstances specified in Section 3(a), its securities which are
Registrable Securities) at any time prior to the effective date of the
Registration Statement relating thereto;
(ii) prepare and file with the commission such amendments and
supplements to such Registration Statement and the prospectus used in
connection therewith as may be necessary to comply with the provisions
of the Securities Act with respect to the disposition of all securities
covered by such Registration Statement until such securities have been
disposed of by the sellers thereof set forth in such Registration
Statement;
(iii) furnish to each seller of Registrable Securities covered by
such Registration Statement such number of conformed copies of the
Registration Statement, and of each amendment and supplement thereto,
such number of copies of the prospectus contained in such Registration
Statement and any other prospectus filed under Rule 424 under the
Securities Act, in conformity with the requirements of the Securities
Act, and such other documents as such seller may reasonably request;
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(iv) use its best efforts to register or qualify all securities
covered by such Registration Statement under such other securities or
blue sky laws of U.S. jurisdictions as each seller thereof shall
reasonably request, to keep such registration or qualification in
effect for so long as the Registration Statement remains in effect, and
to take any other action which may be reasonably necessary or advisable
to enable such seller to consummate the disposition in such
jurisdictions of the securities owned by such seller, except that the
Company shall not for any such purpose be required to (a) qualify
generally to do business as a foreign corporation in any jurisdiction
wherein it would not be obligated to be so qualified but for the
requirements of this subsection or (b) consent to general service of
process in any such jurisdiction;
(v) use its best efforts to cause all Registrable Securities
covered by such Registration Statement to be registered with or
approved by such other governmental agencies or authorities of United
States jurisdictions as may be necessary to enable the seller thereof
to consummate the disposition of such Registrable Securities;
(vi) furnish to each seller of Registrable Securities a signed
counterpart, addressed to such seller and the underwriters, of:
(x) an opinion of counsel for the Company dated the
effective date of the Registration Statement (and dated the
closing date under the underwriting agreement), reasonably
satisfactory in form and substance to such seller, and
(y) a customary "comfort letter" dated the effective
date of the Registration Statement (and dated the date of the
closing under the underwriting agreement), signed by the
independent public accountants who have certified the
Company's financial statements included in such Registration
Statement,
covering substantially the same matters with respect to such
Registration Statement and, in the case of the "comfort letter," with
respect to events subsequent to the date of such financial statements,
as are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to the underwriters in underwritten
public offerings of securities, and, in the case of the legal opinion,
such other legal matters, and, in the case of the "comfort letter,"
such other financial matters, as such seller or the underwriter may
reasonably request;
(vii) at any time when a prospectus relating thereto is required
to be delivered under the Securities Act, notify each seller of
Registrable Securities covered by such Registration Statement promptly
after the Company discovers that the prospectus included in such
Registration Statement as then in effect includes an untrue statement
of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were
made, and at the request of any such seller promptly prepare and
furnish to such seller a reasonable number of copies of a supplement to
or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or
omit
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to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the
circumstances under which they were made;
(viii) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission;
(ix) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by such Registration
Statement from and after a date not later than the effective date of
such Registration Statement;
(x) advise the selling Qualified Shareholders, promptly after it
receives notice or obtains knowledge thereof, of the issuance of any
stop order by the Commission suspending the effectiveness of the
registration statement or the initiation or threatening of any
proceeding for such purpose and promptly use all reasonable efforts to
the prevent the issuance of any stop order or to obtain its withdrawal
if any such stop order should be issued; and
(xi) use its best efforts to list or cause to be quoted all
Registrable Securities covered by such Registration Statement on any
securities exchange on which or in any market in which similar
securities issued by the Company are then listed or quoted.
The Company may require each seller of Registrable Securities as to
which any registration is being effected to furnish the Company such information
regarding such seller and the distribution of such securities as the Company may
reasonably request for the purpose of effecting such registration. Any Person
participating in any Demand Registration or Piggyback Registration must (a)
agree to sell their securities on the basis provided in the underwriting
agreement and (b) complete and execute all documents required under this
Agreement or the underwriting agreement.
Each Qualified Shareholder agrees that upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
4(a)(vii), such Qualified Shareholder will discontinue immediately such
Qualified Shareholder's disposition of securities pursuant to the Registration
Statement until such Qualified Shareholder receives copies of the supplemented
or amended prospectus contemplated by such Section 4(a)(vii) and, if so directed
by the Company, will deliver to the Company all copies, other than permanent
file copies, then in such holder's possession of the prospectus relating to such
Registrable Securities current at the time of receipt of such notice.
(b) Underwriting Agreements. The Company will enter into an
underwriting agreement with the underwriters for any offering pursuant to a
Demand Registration or Piggyback Registration if requested by the underwriters
to do so. The underwriting agreement will contain such representations and
warranties by the Company and such other terms as are generally prevailing at
such time in underwriting agreements. The holders of Registrable Securities to
be distributed by the underwriters shall be parties to such underwriting
agreement and may, at their option, require that any or all of the
representations, warranties, and other agreements by the Company to and for the
benefit of the underwriters also be made to and for the benefit of such holders
of Registrable Securities and that any or all of the conditions precedent to the
obligations
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of such underwriters under such underwriting agreement be conditions precedent
to the obligations of such holders of Registrable Securities. No Qualified
Shareholder shall be required to make representations or warranties to, or
agreements with, the Company or the underwriters other than representations,
warranties or agreements regarding such holder, such holder's Registrable
Securities, such holder's intended method of distribution, any representations
required by law and any other customary representations.
(c) Holdback Agreements. (i) Each Shareholder agrees not to effect any
public sale or distribution of any Common Stock or Common Stock Equivalents
during the 180 days after the Initial Public Offering has become effective and
during the 90 days after any Demand Registration or Piggyback Registration has
become effective, except as part of such Initial Public Offering, Demand
Registration or Piggyback Registration, as the case may be, unless the managing
underwriter of the Initial Public Offering, Demand Registration or Piggyback
Registration otherwise agrees to such sale or distribution.
(ii) The Company agrees not to effect any public sale or
distribution of its equity securities or securities convertible into or
exchangeable or exercisable for any of such securities during the seven
(7) days prior to and the 90 days after any Demand Registration or
Piggyback Registration has become effective, except as part of such
Demand Registration or Piggyback Registration, as the case may be, and
except pursuant to registrations on Form S-4 or S-8 under the
Securities Act or any successor or similar forms thereto.
(d) Preparation; Reasonable Investigation. In connection with the
preparation and filing of each Registration Statement under the Securities Act
pursuant to this Agreement, the Company will give the holders of Registrable
Securities to be registered under such Registration Statement, the underwriters
and their respective counsel and accountants, the opportunity to participate in
preparing the Registration Statement. The Company will also give each of such
Persons such access to its books and records and opportunities to discuss the
business of the Company with the Company's officers and independent public
accountants who have certified the Company's financial statements as shall, in
the opinion of such holders' and such underwriters' respective counsel, be
necessary to conduct a reasonable investigation within the meaning of the
Securities Act.
(e) Rule 144. If the Company files a Registration Statement pursuant to
the Securities Act or Section 12 of the Exchange Act, the Company will also file
the reports required to be filed by it under the Securities Act and the Exchange
Act to enable the Shareholders to sell their Registrable Securities without
registration under the Securities Act and within the exemptions provided under
the Securities Act by Rule 144 or any similar rule or regulation hereafter
adopted by the Commission.
5. Registration Expenses. The Company will bear all expenses incident
to the Company's compliance with this Agreement, including, without limitation,
registration, filing and fees with the Commission and the NASD, securities and
blue sky compliance fees and expenses, word processing expenses, duplicating
expenses, printing expenses, engraving expenses, messenger and delivery
expenses, Company general and administrative expenses, counsel and accountants
(including, without limitation, the reasonable fees and disbursements of not
more than one counsel selected by the selling Qualified Shareholders to
represent such selling Qualified
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Shareholders in connection with a Demand Registration), special audit costs,
financial statement and reconstruction costs, comfort letter costs, underwriter
fees and disbursements customarily paid by issuers or sellers of securities
(including fees paid to a "qualified independent underwriter" required by the
rules of the NASD in connection with a distribution), "road show" expenses and
allocations and the expense for other Persons retained by the Company, but
excluding (x) fees and disbursements of the Qualified Shareholders' counsel,
accountants or other representatives (except as otherwise provided in this
Section 5), and (y) discounts, commissions or fees of underwriters, selling
brokers, dealer managers, sales agents or similar securities industry
professionals relating to the distribution of Registrable Securities and
applicable transfer taxes, if any, which shall be borne by the sellers of the
Registrable Securities being registered in all cases.
6. Indemnification.
(a) Indemnification by the Company. In the event of any Demand
Registration or Piggyback Registration of any Registrable Securities under the
Securities Act, the Company shall, and hereby does, indemnify and hold harmless
each seller of any Registrable Securities covered by the Registration Statement
with respect thereto, such seller's partners, directors and officers, each
underwriter (including any "qualified independent underwriter" required by the
rules of the NASD) of the offering or sale of such securities, and each Person
who controls such seller or underwriter within the meaning of the Securities
Act, against any uninsured losses, claims, damages or liabilities to which such
seller, partner, director, officer, underwriter or controlling Person, as the
case may be, may become subject under the Securities Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of material fact contained
in the Registration Statement under which such Registrable Securities were sold
or an omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
and the Company will reimburse each such indemnified Person for expenses
reasonably incurred by it in connection with defending such loss, claim, damage,
liability, action or proceeding; provided, however, that the Company shall not
be liable in any such case for any losses, claims, damages, liabilities (or
actions or proceedings in respect thereof) or expenses which arise out of or are
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made by the Company in such Registration Statement in reliance
upon information furnished to the Company in writing by such Person for
inclusion in the Registration Statement; and provided further, however, that the
Company shall not be liable to and does not indemnify any underwriter in the
offering or sale of Registrable Securities, or any Person who controls an
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such Person's failure to send or give
a copy of the final prospectus, as the same may be supplemented or amended, to
the Person asserting an untrue statement or alleged untrue statement or omission
or alleged omission at or prior to the written confirmation of the sale of
Registrable Securities, if such statement or omission was in the prospectus.
This indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of an indemnified party, and shall survive
the transfer of such Registrable Securities by the seller thereof.
(b) Indemnification by the Sellers. The Company may require, as a
condition to including any Registrable Securities in any Registration Statement,
that the Company receive an
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undertaking satisfactory to it from the prospective seller(s) of such
Registrable Securities, to indemnify and hold harmless (in the same manner and
to the same extent as set forth in Section 6(a)) the Company, its directors, its
officers, and each other Person who controls the Company within the meaning of
the Securities Act, with respect to any statement or alleged statement in or
omission or alleged omission from such Registration Statement, if such statement
or alleged statement or omission or alleged omission was made in reliance upon
information furnished to the Company in writing by such seller for inclusion in
the Registration Statement. If applicable, the prospective sellers' obligation
to indemnify will be several, not joint and several, among such sellers. In no
event shall the liability of any seller hereunder or under any underwriting
agreement be greater in amount than net proceeds received by such seller upon
the sale of the Registrable Securities (before deducting expenses) giving rise
to such indemnification obligation. The Company shall also be entitled to
receive indemnities from underwriters, selling brokers, dealer mangers, and
similar securities industry professionals participating in the distribution,
asset forth in the underwriting agreement governing such registration statement.
This indemnity shall remain in full force and effect, regardless of any
investigation made by or on behalf of the Company, its directors, officers or
controlling Persons, and shall survive the transfer of such Registrable
Securities by the seller thereof.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action, suit, investigation or
proceeding involving a claim referred to in Sections 6(a) or (b), such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party, give written notice to the latter of the commencement of
such action. The failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligations under the
preceding subdivisions of this Section 6, except to the extent that the
indemnifying party is materially prejudiced by the failure to give such notice.
In case any such action is brought against an indemnified party, unless in such
indemnified party's reasonable judgment a conflict of interest between such
indemnified party and the indemnifying parties may exist in respect of such
claim, the indemnifying party shall be entitled to participate in and to assume
the defense thereof, jointly with any other indemnifying party similarly
notified to the extent that it may wish, with counsel reasonably satisfactory to
the indemnified party. After notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable for any settlement made by the
indemnified party without the indemnifying party's consent (which consent will
not be unreasonably withheld) or for any legal or other expenses subsequently
incurred by the indemnified party in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
consent of the indemnified party, consent to entry of any judgment or enter into
any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect to such claim or litigation.
(d) Other Indemnification. Indemnification similar to that specified in
the preceding subdivisions of this Section 6 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any federal or state law or regulation of any governmental authority other than
the Securities Act.
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(e) Indemnification Payments. The indemnification required by this
Section 6 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
(f) Contribution. If the indemnification provided for in this Agreement
is for any reason unavailable or insufficient to indemnify an indemnified party
under Section 6(a), (b) or (d) hereof in respect of any loss, claim, damage or
liability, or any action in respect thereof, or referred to therein, then each
indemnifying party shall, in lieu of indemnifying such party, contribute to the
amount payable by such indemnified party as a result of such loss, claim, damage
or liability, or action in respect thereof, in a proportion which reflects: (i)
the relative benefits received on the one hand by the Company and on the other
hand by the holders of the Registrable Securities included in the offering; (ii)
the relative fault with respect to the statements or omissions which resulted in
such loss, claim, damage or liability, or action in respect thereof, on the one
hand of the Company and on the other hand of the holders of the Registrable
Securities included in the offering; and (iii) any other relevant equitable
considerations.
The relative benefits received shall be deemed to be in the same
proportion which the sum of the total subscription price paid to the Company in
respect of the Registrable Securities plus the total net proceeds from the
offering of the securities (before deducting expenses) received by the Company
bears to the amount by which the total net proceeds from the offering of the
securities (before deducting expenses) received by the holders of the
Registrable Securities with respect to such offering exceeds the subscription
price paid to the Company in respect of the Registrable Securities, and in each
case, the net proceeds received from such offering shall be determined as set
forth on the table of the cover page of the prospectus.
The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the holders of the Registrable Securities; the
intent of the parties; the parties' relative knowledge; the parties' access to
information; and the parties' opportunity to correct or prevent such statement
or omission. The Company and the Shareholders agree that it would not be just
and equitable if contribution pursuant to this Section 6 is determined by pro
rata allocation or by any other method of allocation which does not take into
account the equitable considerations referred to herein.
The amount paid or payable by an indemnified party as a result of the
loss, claim, damage or liability, or action in respect thereof, referred to in
this Subsection 6(f) shall be deemed to include, for purposes of this Subsection
6(f), any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any action or claim. No person
guilty of "fraudulent misrepresentation" within the meaning of Section 11 of the
Securities Act shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
7. Miscellaneous.
(a) Amendments and Waivers. This Agreement may be amended or waived by
consent of the Company and the Shareholders holding a majority of the
Registrable Shares. Each Shareholder shall be bound by any consent authorized by
this Section 7(a), whether or not any
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certificates representing shares of Common Stock shall have been marked to
indicate such consent.
(b) Notices. All consents, notices and other communications provided
for hereunder shall be in writing shall be deemed to be duly given when received
if personally delivered; upon confirmation of transmission if transmitted by
telecopy, electronic or digital transmission method; the day after it is sent if
sent via overnight delivery service; and upon receipt if sent by registered or
certified mail. Communications to a Shareholder must be addressed to such
Shareholder according to the shareholder records of the Company or at such other
address as such Shareholder communicates to the Company. Communications to the
Company must be addressed to: Nelnet, Inc. 000 Xxxxx 00xx Xxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxx 00000, Attention: [ ], Facsimile (402) 458-[ ].
(c) Assignment. This Agreement is personal to the parties hereto and
not assignable and may not be enforced by any subsequent holder of securities of
the Company; [provided, however, that this Agreement shall be assignable to, and
shall bind and inure to the benefit of, each transferee of shares of Common
Stock pursuant to an Exempt Transfer.]
(d) Additional Rights. If the Company at any time grants to any other
holders of Common Stock or Common Stock Equivalents any rights to request the
Company to effect the registration under the Securities Act of any such shares
of Common Stock or Common Stock Equivalents on terms more favorable to such
holders than the terms set forth herein, the terms of this Agreement shall be
deemed amended or supplemented to the extent necessary to provide the
Shareholders with the same more favorable terms. The Company shall not grant any
other Person rights to register securities of the Company on terms which could
restrict in any way the ability of the Company to fully perform its obligations
to the Shareholders pursuant to this Agreement.
(e) Descriptive Headings. The descriptive headings of the sections and
paragraphs of this Agreement are for reference only and shall not limit or
otherwise affect the meaning hereof.
(f) Governing Law. This Agreement shall be governed by, and construed
and enforced in accordance with, the internal laws of the State of Nebraska.
(g) Submission to Jurisdiction; Service of Process.
(i) Each of the parties hereto irrevocably submits to the
jurisdiction of the [ ] of the State of Nebraska, County of
[ ], the U.S. District Court for the [ ] and any appellate
court or body thereto, over any suit, action or proceeding arising out
of or relating to this Agreement. In addition, each party hereto
irrevocably submits to the jurisdiction of the state and federal courts
located in the jurisdiction in which such party has been organized or
is domiciled in connection with any such suit, action or proceeding
that may be brought against such party as a defendant. Each party
hereto irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue
of any such suit, action or proceeding brought in any such court and
any claim that any such suit, action or proceeding brought in such
court has been brought in an inconvenient forum, and further agrees
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that a final judgment in any such suit, action or proceeding brought in
such court shall be conclusive and binding upon such party.
(ii) Each party hereto hereby irrevocably consents to the service
of any process, pleading, notices or other appears by the mailing of
copies thereof by registered, certified or first class mail, postage
prepaid, to such party at such party's address set froth herein, or by
any other method provided or permitted under Nebraska law.
(h) Counterparts. This Agreement may be executed in any number of
counterparts. Each counterpart is an original, but all counterparts shall
together constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.
NELNET, INC.
By: ________________________________________
Name:
Title:
SHAREHOLDERS:
By: ________________________________________
Xxxxxxx X. Xxxxxx
By: ________________________________________
Xxxxxxx X. Xxxxxxxxxxx
By: ________________________________________
Xxxxx Xxxxxx
By: ________________________________________
Union Financial Services, Ltd.
By: ________________________________________
Union Bank as Trustee for the Xxxxxxx
X. Xxxxxx Grantor Retained Annuity Trust
By: ________________________________________
Union Bank as Trustee for the Xxxxxxx
X. Xxxxxxxxxxx Grantor Retained Annuity
Trust
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SCHEDULE OF SHAREHOLDERS
SHAREHOLDER NUMBER OF INITIAL REGISTRABLE SECURITIES
Xxxxxxx X. Xxxxxx 4,542,513
Xxxxxxx X. Xxxxxxxxxxx 4,193,250
Xxxxx Xxxxxx 1,701,000
Union Financial Services, Inc. 1,586,691
Union Bank as Trustee
for the Xxxxxxx X. Xxxxxx
Grantor Retained Annuity Trust 1,400,000
Union Bank as Trustee
for the Xxxxxxx X. Xxxxxxxxxxx
Grantor Retained Annuity Trust 600,000
