Exhibit 3.3
AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF
NELNET STUDENT LOAN FUNDING, LLC
THIS AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (together
with the schedules attached hereto, this "Agreement") of NELNET STUDENT LOAN
FUNDING, LLC (the "Company"), dated as of May 1, 2002, is entered into by
NELNET, INC. (in its capacity as member hereunder, the "Member") as the sole
economic member of the Company and NELNET STUDENT LOAN FUNDING MANAGEMENT
CORPORATION (in its capacity as member hereunder, the "Special Member" or, in
its capacity as manger hereunder, the "Manager"), as the special member of the
Company. Capitalized terms used and not otherwise defined herein have the
meanings set forth in Schedule A hereto, or, if not defined in Schedule A, such
terms have the meanings set forth in the Basic Documents (as defined in Schedule
A hereto).
RECITALS
A. The Certificate of Formation for the Company was filed with the
Delaware Secretary of State on January 25, 2002.
B. The Member previously executed a Limited Liability Company Agreement
for the Company, dated as of January 25, 2002.
C. The Member and the Special Member desire to continue the Company
under the Act and to amend and restate the Limited Liability Company Agreement
of the Company dated as of January 25, 2002.
D. The Member and the Special Member intend that this Agreement amend,
supersede and restate the previous Limited Liability Company Agreement dated as
of January 25, 2002 in its entirety.
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Member and the Special Member
hereby agree as follows:
SECTION 1. FORMATION; NAME.
(a) The Company was formed as a Delaware limited liability
company upon the filing the Certificate of Formation on January 25,
2002.
(b) The name of the limited liability company heretofore formed
and continued hereby is Nelnet Student Loan Funding, LLC and the
business of the Company shall be conducted solely under such name or any
other name, to the extent permitted by law.
SECTION 2. TITLE TO COMPANY PROPERTY. No real or other property of the
Company shall be deemed owned or leased by the Member or the Special Member
individually, but shall be owned by, and title shall be vested solely in, the
Company.
SECTION 3. TERM. The term of the Company shall commence upon the filing
of the Certificate of Formation with the Delaware Secretary of State and shall
continue until dissolution, termination or liquidation of the Company in
accordance with the provisions of Section 28 hereof but not exceed a period of
fifty (50) years, unless continued as may be set forth in this Agreement or
sooner dissolved in accordance with the Act or this Agreement.
SECTION 4. PRINCIPAL BUSINESS OFFICE. The principal business office of
the Company shall be located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other location as may hereafter be determined by the
Manager.
SECTION 5. REGISTERED OFFICE. The address of the registered office of
the Company in the State of Delaware is c/o The Corporate Trust Company, whose
business address is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SECTION 6. REGISTERED AGENT. The name and address of the registered
agent of the Company for service of process on the Company in the State of
Delaware is The Corporate Trust Company, whose business address is ▇▇▇▇ ▇▇▇▇▇▇
▇▇., ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SECTION 7. MEMBER.
(a) The mailing addresses of the Member and Special Member are
set forth on Schedule B hereto.
(b) Subject to Section 11(b), the Member and the Special Member
may act by written consent.
(c) The Member shall be the only member of the Company that has
a limited liability company interest in the Company which represents an
interest in the profits, losses, and capital of the Company and the
right to receive distributions of Company assets. The Member owns a 100%
interest in the profits, losses and capital of the Company. Unless the
Special Member is the sole member of the Company, the Special Member
shall have no interest in the profits, losses or capital of the Company
and shall have no right to receive any distributions of Company assets.
The Special Member shall be admitted as a member of the Company within
the meaning of the Act upon execution and delivery of this Agreement or
a counterpart signature page to this Agreement. Pursuant to Section
18-301 of the Act, the Special Member shall not be required to make any
capital contribution to the Company. Upon the occurrence of an event
that causes the Member to cease to be a member of the Company, the
Special Member shall, to the fullest extent permitted by law, continue
the business of the Company without dissolution. Notwithstanding the
last sentence of Section 18-402 of the Act and except as provided in
this Agreement, the Special Member may not bind the Company.
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SECTION 8. CERTIFICATES. ▇▇▇▇▇▇ ▇▇▇▇▇▇ is hereby designated as an
"authorized person" within the meaning of the Act, and has executed, delivered
and filed the Certificate of Formation of the Company with the Secretary of
State of the State of Delaware. Upon the filing of the Certificate of Formation
with the Secretary of State of the State of Delaware, his powers as an
"authorized person" ceased and the Member thereupon became the designated
"authorized person" and shall continue as the designated "authorized person"
within the meaning of the Act. The Manager shall execute, deliver and file any
other certificates (and any amendments and/or restatements thereof) necessary
for the Company to qualify to do business in any jurisdiction in which the
Company may wish to conduct business. The existence of the Company as a separate
legal entity shall continue until cancellation of the Certificate of Formation
as provided in the Act.
SECTION 9. PURPOSES. The purpose to be conducted or promoted by the
Company is to engage solely in the following activities:
(a) to acquire, own, hold, sell, transfer, convey, dispose of,
pledge, assign, borrow money against, finance, refinance or otherwise
deal with, publicly or privately and whether with unrelated third
parties or with Affiliated Persons, Student Loans directly or through
one or more trustees;
(b) to (i) act as settlor or depositor of one or more trusts
(each, a "Trust") formed under a trust agreement (the "Trust Agreement")
to be entered into by, among others, the Company, the trustee or
trustees named therein, and any other party signing a Trust Agreement,
that will issue one or more series of trust certificates representing
interests in Financed Student Loans or a Trust and/or issue pursuant to
an indenture or other agreement one or more series of bonds, notes or
other evidences of indebtedness (together with such certificates, the
"Securities") collateralized by Financed Student Loans and/or other
property and (ii) enter into any other agreement in connection with the
authorization, issuance, sale and delivery of Securities, including,
without limitation, the Basic Documents to which it is a party and
arrangements for support for any series of Securities by various forms
or credit enhancement;
(c) to authorize, issue, sell and deliver Securities or other
instruments secured or collateralized by the Securities;
(d) subject to Section 11(b), to acquire, hold, pledge, finance,
transfer or otherwise deal with Securities;
(e) subject to Section 11(b), to loan or invest or otherwise
apply proceeds from Financed Student Loans, funds received in respect of
Securities and any other income and to sell and repurchase Financed
Student Loans in accordance with the terms thereof;
(f) to enter into interest rate, basis swap, cap, floor or
collar arrangements or other hedging arrangements and management and
administrative agreements in connection with the foregoing activities;
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(g) to negotiate, authorize, execute, deliver, assume the
obligations under, and perform, any agreement or instrument or document
relating to the activities set forth in clauses (a) through (f) above;
(h) to ▇▇▇ and be sued, complain and defend, and participate in
administrative or other proceedings, in its name;
(i) to employ and otherwise engage employees and agents of the
Company (who may be designated as officers of the Company with titles),
and define their duties and fix their compensation;
(j) to indemnify any Person in accordance with the Act;
(k) to pay, collect, compromise, litigate, arbitrate or
otherwise adjust or settle any and all other claims or demands of or
against the Company or to hold such proceeds against the payment of
contingent liabilities;
(l) to engage in any activity and to exercise any powers
permitted to limited liabilities companies under the laws of the State
of Delaware that are related or incidental to the foregoing and
necessary, convenient or advisable to accomplish the foregoing. The
Company shall not engage in any business or activity other than in
connection with or relating to the activities described above; and
(m) the Company, by or through the Manager or any officer of the
Company on behalf of the Company, may enter into and cause the Company
to perform the Basic Documents and all documents, agreements,
certificates or financing statements contemplated thereby or related
thereto, all without any further act, vote or approval of any other
Person notwithstanding any other provision of this Agreement, the Act or
applicable law, rule or regulation, and any such actions heretofore
taken by any such Persons are hereby ratified. The foregoing
authorization shall not be deemed a restriction on the powers of the
Member, Manager or officer of the Company to enter into other agreements
on behalf of the Company.
SECTION 10. RESERVED.
SECTION 11. MANAGEMENT.
(a) The management of the Company is fully vested in the
Manager, and except as otherwise provided in this Agreement, such
Manager shall have full power and authority to manage the business and
affairs of the Company in accordance with Section 9.
(b) LIMITATIONS ON THE COMPANY'S ACTIVITIES.
(i) This Section 11(b) is being adopted in order to
comply with certain provisions required in order to qualify the
Company as a "special purpose entity."
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(ii) So long as any Obligation is outstanding and for a
period of one year and one day thereafter, the Member shall not
amend, alter, change or repeal the definition of Special Member
or Section 9, 11, 14, 24, 25, 26, 27, 28, 29, 30, 33 or 37 or
Schedule A of this Agreement without the written consent of the
Special Member (which shall not be deemed to have consented
unless all of the Special Directors of the Special Member have
duly authorized the Special Member to consent thereto). Subject
to this Section 11(b), the Member and the Special Member reserve
the right to amend, alter, change or repeal any provisions
contained in this Agreement in accordance with Section 37.
(iii) So long as any Obligation is outstanding and for a
period of one year and one day thereafter, the Member, the
Special Member, the Manager and the Company shall cause the
Company to do or cause to be done all things necessary to
preserve and keep in full force and effect its existence, rights
(charter and statutory) and franchises, will obtain and preserve
its qualification to do business in each jurisdiction in which
such qualification is or shall be necessary to protect the
validity and enforceability of this Agreement and the Basic
Documents, and observe all procedures and provisions required by
this Agreement and the laws of the State of Delaware.
(iv) The Member, the Special Member and the Manager
shall cause the Company to:
(A) maintain its own records, accounts, books of
account and bank accounts separate from those of any
other Person and shall not commingle its records,
accounts, books of account and bank accounts with the
organizational or other records, accounts, books of
account or bank accounts of any other Person and such
records, accounts, books of account and bank accounts
shall reflect the separate existence of the Company;
(B) act solely in its own name and through its
duly authorized officers or agents in the conduct of its
business, prepare all Company correspondence in the
Company name, hold itself out as a separate entity from
any other Person, conduct its business so as not to
mislead others as to the identity of the entity with
which they are concerned, correct any known
misunderstanding regarding its separate identity,
refrain from engaging in any activity that compromises
the separate legal identity of the Company, and strictly
comply with all organizational formalities to maintain
its separate existence;
(C) file its own tax returns, if any, as may be
required under applicable law, to the extent (1) not
part of a consolidated group filing a consolidated
return or returns or (2) not treated as a disregarded
entity or activity for tax purposes of another taxpayer,
and pay any taxes so required to be paid under
applicable law;
(D) not commingle its assets with assets of any
other Person;
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(E) maintain financial statements separate from
any other Person. The annual financial statements of the
Company shall disclose the effects of its transactions
in accordance with generally accepted accounting
principles. The consolidated financial statements, if
any, which consolidate the assets and earnings of the
Member with those of the Company shall contain a
footnote stating that the assets of any of the Company
shall not be available to creditors of the Member. The
financial statements (if any) of the Company shall
disclose that the assets of the Company are not
available to pay creditors of the Member or any other
affiliate (other than the obligations of the Company to
pay the expenses of and to indemnify the trustee under a
Trust Agreement);
(F) pay its liabilities and operating expenses
only out of its funds and not pay from its assets any
obligations or indebtedness of any other Person;
(G) maintain an arm's length relationship with
its Member, Special Member, Manager, their respective
Affiliates and any trust in which it holds a beneficial
interest, not enter into any contract or agreement with
its Member, Special Member, Manager, their respective
Affiliates or and any trust in which it holds a
beneficial interest except on terms that are
intrinsically fair, commercially reasonable, and
substantially similar to those that would be available
on an arms-length basis with third parties, and transact
all business with its Member, Special Member, Manager,
their Affiliates and any trust in which it holds a
beneficial interest pursuant to written, enforceable
agreements;
(H) pay the salaries of its own employees, if
any, and maintain a sufficient number of employees in
light of its contemplated business operations;
(I) not be, become or hold itself out as being
liable for the debts of any other party, or hold out its
credit as being available to satisfy the obligation of
others. The Company will not act as the agent of the
Member or its Affiliates. The Member will not act as the
agent for the Company, except as specifically permitted
by this Agreement;
(J) allocate fairly and reasonably with any
other Person expenses that are shared with such Person
including, without limitation, any overhead, rent, or
other compensation paid for shared or leased office
space. Independent contractors performing services or
incurring expenses in connection with such services for
the Company shall receive compensation for such services
rendered or expenses incurred in an amount equal to the
fair value of such services and expenses;
(K) use stationery, invoices and checks separate
from any other Person;
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(L) not pledge (except pursuant to the Basic
Documents), lend or advance any moneys to, or make an
investment in or for the benefit of, guarantee (directly
or indirectly), endorse or otherwise become contingently
liable (directly or indirectly) for the obligations of,
or own or purchase any stock, obligations or securities
of or any other interest in, or make any capital
contribution to, any other Person, except as permitted
by the Basic Documents;
(M) maintain adequate capital for the normal
obligations reasonably foreseeable in a business of the
Company's size and character and in light of its
proposed business operations and liabilities;
(N) not engage, directly or indirectly, in any
business other than the actions required or permitted to
be performed under Section 9 hereof;
(O) not sell, pledge, transfer, assign or
otherwise convey less than 100% of the interest of the
Member in the Company if, following such sale, pledge,
transfer, assignment or conveyance, the Member would
consist of more than one Person who are not affiliates
of the Member;
(P) cause the Manager, officers, agents and
other representatives of the Company, if any, to act at
all times with respect to the Company consistently and
in furtherance of the foregoing and in the best
interests of the Company; and
(Q) not acquire or assume any obligation or
liability of, or purchase any stock or securities of or
any other interest in, or make any capital contribution
to, any of its members, affiliates of such members, or
other Affiliates of the Company.
Failure by the Company or the Member or the Manager, on behalf of the
Company, to comply with any of the foregoing (A) through (Q) or any
other covenant set forth in this Agreement shall not affect the status
of the Company as a separate legal entity or the limited liability of
the Member, the Special Member or the Manager.
(v) NEGATIVE COVENANTS. So long as any Obligation is outstanding
or any amounts are owed by the Company under any Basic Document and for
a period of one year and one day thereafter, without the consent of the
Special Member (which shall not be deemed to have consented unless all
of the Special Directors of the Special Member have duly authorized the
Special Member to consent thereto), neither the Company, the Member, the
Manager nor any other Person on behalf of the Company shall have the
authority to:
(A) do any act in contravention of this
Agreement;
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(B) do any act which would make it impossible to
carry on the ordinary business of the Company, except as
otherwise provided in this Agreement;
(C) confess a judgment against the Company;
(D) enter into any agreement or transaction in
connection with or related to the Company, the business
or activities of the Company, or securities issued by
the Company, or a Trust, or a trust of which the Company
is a participant that is inconsistent with the terms of
the Basic Documents;
(E) possess Company Property, or assign rights,
if any, in specific Company Property, for other than
Company purpose;
(F) knowingly perform any act that would subject
(1) the Member or Special Member to liabilities of the
Company in any jurisdiction or (2) the Company to
taxation as a corporation under relevant provisions of
the Code;
(G) except as otherwise provided for herein or
as contemplated by the Basic Documents, sell, pledge,
transfer, assign or otherwise convey the Company
Property;
(H) take any Material Action, notwithstanding
any other provision of this Agreement and any provision
of law that otherwise so empowers the Company, the
Member, or the Manager; or
(I) except with respect to (i) obligations of
the Company to indemnify the trustee of a Trust or trust
in which the Company is a participant or (ii)
representations and warranties made by the Company
related to loans transferred by the Company to such
trusts, enter into any agreements, written or otherwise,
between the Member or Manager and the Company or any
other Person pursuant to which the Member or Manager
agrees to extend credit or make payment or contributions
to or for or assume, guaranty or otherwise be obligated
for the payment or performance of either the Special
Member or the Company; provided, however, that any
Member may make any capital contributions to the Company
or the Special Member that such Member determines to be
in the Member's own best interest.
SECTION 12. CREDIT INTERESTS. To the fullest extent permitted by law,
including Section 18-1101(c) of the Act, in acting or otherwise voting on the
matters with respect to the Company and notwithstanding that the Company may not
be insolvent, the Member, the Special Member and the Manager shall take into
account the interests of the Company's creditors as well as those of the Member
and the Company.
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SECTION 13. NO DISSOLUTION ON CERTAIN EVENTS. Notwithstanding anything
to the contrary in this Agreement, the occurrence of any events described in
Section 18-304 of the Act shall not cause the Member to cease to be the Member
of the Company, and upon the occurrence of such an event, the business of the
Company shall continue without dissolution.
SECTION 14. SPECIAL MEMBER AND MANAGER.
(a) As long as any Obligation is outstanding or any amounts are
owed by the Company under any Basic Document and for a period of one
year and one day thereafter, except in the case of a temporary vacancy,
which shall promptly be filled, the Member shall cause the Company at
all times to have a Special Member. All right, power and authority of
the Special Member shall be limited to the extent necessary to exercise
those rights and perform those duties specifically set forth in this
Agreement. At such time as all Obligations of the Company have been paid
in full and no amounts are owed by the Company under any Basic Document
and for a period of one year and one day thereafter, any provision of
Section 11(b) or otherwise herein requiring the consent of the Special
Member shall no longer be effective.
(b) All right, power and authority of the Manager shall be
limited to the extent necessary to exercise those rights and perform
those duties specifically set forth in this Agreement. The Manager is an
agent of the Company for the purpose of its business, and the act of the
Manager, including the execution in the Company name of any instrument
for apparently carrying on in the usual way the business of the Company,
binds the Company, unless such act is in contravention of the
Certificate of Formation or this Agreement or unless the Manager so
acting otherwise lacks the authority to act for the Company and the
person with whom the Manager is dealing has knowledge of the fact that
the Manager has no such authority. Except as provided in the preceding
paragraph, in exercising its rights and performing its duties under this
Agreement, the Manager shall have fiduciary duty of loyalty and care
similar to that of a director of a business corporation organized under
the General Corporation Law of the State of Delaware. The Manager shall
not at any time serve as trustee in bankruptcy for any Affiliate of the
Company. No resignation or removal of a Manager, and no appointment of a
successor Manager, shall be effective until the successor Manager shall
have accepted his or her appointment by a written instrument, which may
be a counterpart signature page to this Agreement. In the event of
death, incapacity or other termination of a Manager, the Special Member
and the Member shall appoint a mutually agreeable successor Manager
within 10 days.
SECTION 15. OFFICERS. The Member may, from time to time as it deems
advisable, appoint officers of the Company and assign in writing titles
(including, without limitation, president, vice president, secretary, and
treasurer) to any such person. Unless the Member decides otherwise, if the title
is one commonly used for officers of a business corporation formed under the
Delaware General Corporation Law, the assignment of such title shall constitute
the delegation to such person of the authorities and duties that are normally
associated with that office. Any delegation pursuant to this Section 15 may be
revoked at any time by the Manager.
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SECTION 16. LIMITED LIABILITY. Except as otherwise expressly provided by
the Act, the debts, obligations and liabilities of the Company, whether arising
in contract, tort or otherwise, shall be the debts, obligations and liabilities
solely of the Company, and neither the Member, the Special Member nor the
Manager shall be obligated personally for any such debt, obligation or liability
of the Company solely by reason of being a Member, Special Member or Manager of
the Company.
SECTION 17. CAPITAL CONTRIBUTIONS. The Member shall contribute to the
Company property of an agreed value as listed on Schedule B hereto. In
accordance with Section 7(c), the Special Member shall not be required to make
any capital contributions to the Company.
SECTION 18. ADDITIONAL CONTRIBUTIONS. The Member is not required to make
any additional capital contribution to the Company. However, the Member may make
additional capital contributions to the Company at any time upon the written
notification by such Member to the Manager. To the extent that the Member makes
an additional capital contribution to the Company, the Manager shall revise
Schedule B of this Agreement. The provisions of this Agreement, including this
Section 18, are intended solely to benefit the Member and, to the fullest extent
permitted by law, shall not be construed as conferring any benefit upon any
creditor of the Company (and no such creditor of the Company shall be a
third-party beneficiary of this Agreement) and neither the Member or the Manager
shall have any duty or obligation to any creditor of the Company to make any
contribution to the Company or to issue any call for capital pursuant to this
Agreement.
SECTION 19. ALLOCATION OF PROFITS AND LOSSES. The Company's profits and
losses shall be allocated to the Member. The Special Member shall not be
allocated any profits or losses.
SECTION 20. DISTRIBUTIONS. Distributions shall be made to the Member at
the times and in the aggregate amounts determined by the Manager.
Notwithstanding any provision to the contrary contained in this Agreement, the
Company shall not be required to make a distribution to the Member on account of
its interest in the Company if such distribution would violate Section 18-607 of
the Act or any other applicable law or any Basic Document.
SECTION 21. BOOKS AND RECORDS. The Manager shall keep or cause to be
kept complete and accurate books of account and records with respect to the
Company's business. The books of the Company shall at all times be maintained by
the Manager. The Company shall not have the right to keep confidential from the
Member or the Special Member any information that any Manager of the Company
would otherwise be permitted to keep confidential from the Member or the Special
Member pursuant to Section 18-305(c) of the Act. The Company's books of account
shall be kept using the method of accounting determined by the Manager. The
Company's independent auditor, if any, shall be an independent public accounting
firm selected by the Manager. The books and records and bank accounts of the
Company may be kept inside or outside of the State of Delaware, at such place or
places as may be designated from time to time by the Manager, subject to any
statutory limitations set forth in the Act.
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SECTION 22. REPORTS.
(a) The Company shall use diligent efforts to cause to be
prepared and mailed to the Member and the Special Member, within 120
days after the end of each fiscal year, an audited or unaudited report
setting forth as of the end of such fiscal year:
(i) a statement of financial condition of the Company;
(ii) an income statement of the Company for such fiscal
year; and
(iii) a statement of the Member's capital account.
(b) The Company shall, after the end of each fiscal year, use
reasonable efforts to cause the Company's independent accountants, if
any, to prepare and transmit to the Member and the Special Member as
promptly as possible any such tax information as may be reasonably
necessary to enable the Member and the Special Member to prepare their
respective federal, state and local income tax returns relating to such
fiscal year.
SECTION 23. OTHER BUSINESS. The Member, the Manager, the Special Member
and any of their respective Affiliates, may engage in or possess an interest in
other business ventures (unconnected with the Company) of every kind and
description, independently or with others. The Company shall not have any rights
in or to such independent ventures or the income or profits therefrom by virtue
of this Agreement. Notwithstanding the foregoing, the Member, the Manager, the
Special Member and any of their respective Affiliates shall account to the
Company, and hold in trust for it, any property, profit or benefit received by
the Member, the Manager, the Special Member and any of their respective
Affiliates in the conduct or winding up of the Company's business or from use or
appropriation by the Member, the Manager, the Special Member or any of their
respective Affiliates of any Company Property, including, without limitation,
any information developed exclusively for the Company and opportunities offered
exclusively to the Company.
SECTION 24. EXCULPATION AND INDEMNIFICATION.
(a) Neither the Member, the Special Member, any Manager, any
Officer, nor any employee or agent of the Company and no employee,
representative, agent or Affiliate of the Member or Special Member
(collectively, the "Covered Persons") shall be liable to the Company or
any other Person who has an interest in the Company for any loss, damage
or claim incurred by reason of any act or omission performed or omitted
by such Covered Person in good faith on behalf of the Company and in a
manner reasonably believed to be within the scope of the authority
conferred on such Covered Person by this Agreement, except that a
Covered Person shall be liable for any such loss, damage or claim
incurred by reason of such Covered person's gross negligence or willful
misconduct.
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(b) To the fullest extent permitted by applicable law, a Covered
Person shall be entitled to indemnification from the Company for any
loss, damage or claim incurred by such Covered Person by reason of any
act or omission performed or omitted by such Covered Person in good
faith on behalf of the Company and in a manner reasonably believed to be
within the scope of the authority conferred on such Covered Person by
this Agreement, except that no Covered Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such
Covered Person by reason of such Covered Person's gross negligence or
willful misconduct with respect to such acts or omissions; provided,
however, that any indemnity under this Section 24 by the Company shall
be provided out of and to the extent of the Company assets only, and the
Member and the Special Member shall not have personal liability on
account thereof; and provided further, that so long as any Obligation is
outstanding, no indemnity payment from funds of the Company (as distinct
from funds from other sources, such as insurance) of any indemnity under
this Section 24 shall be payable from amounts allocable to any other
Person pursuant to the Basic Documents.
(c) To the fullest extent permitted by applicable law, expenses
(including legal fees) incurred by a Covered Person defending any claim,
demand, action, suit or proceeding shall, from time to time, be advanced
by the Company prior to the final disposition of such claim, demand,
action, suit or proceeding upon receipt by the Company of an undertaking
by or on behalf of such Covered Person to repay such amount if it shall
be determined that the Covered person is not entitled to be indemnified
as authorized in this Section 24.
(d) A Covered Person shall be fully protected in relying in good
faith upon the records of the Company and upon such information,
opinions, reports or statements presented to the Company by any Person
as to matters the Covered Person reasonably believes are within such
other Person's professional or expert competence and who has been
selected with reasonable care by or on behalf of the Company, including
information, opinions, reports or statements as to the value and amount
of the assets, liabilities, or any other facts pertinent to the
existence and amount of assets from which distributions to the member
might properly be paid.
(e) To the extent that, at law or in equity, a Covered Person
has duties (including fiduciary duties) and liabilities relating thereto
to the Company or to any other Covered Person, a Covered Person acting
under this Agreement shall, to the fullest extent permitted by
applicable law, not be liable to the Company or to any other Covered
Person for its good faith reliance on the provisions of this Agreement
or any approval or authorization granted by the Company or any other
Covered person. The provisions of this Agreement, to the extent that
they restrict the duties and liabilities of a Covered Person otherwise
existing at law or in equity, are agreed by the Member and the Special
Member to replace such other duties and liabilities of such Covered
Person.
(f) The foregoing provisions of this Section 24 shall survive
any termination of the Company or this Agreement.
SECTION 25. PROHIBITION OF THE SALE; TRANSFER OR MORTGAGE OF MEMBER
INTERESTS.
(a) Except as provided in Section 11(b)(iv)(O), no Member or
beneficial owner of any Member Interest shall sell, assign, transfer,
mortgage, charge or otherwise encumber, or suffer any third party to
sell, assign, transfer, mortgage, charge or otherwise encumber, or
contract to do or permit any of the foregoing, whether voluntarily or by
operation of law (collectively called a "Transfer"), its Member Interest
or any beneficial interest therein and any attempt to do so will be
void.
12
(b) In the event that the Member shall at any time transfer or
attempt to transfer any of its Member Interest and any rights hereby
granted in violation of Section 11(b)(iv)(O), the Special Member or any
Manager shall, in addition to all rights and remedies at law and in
equity, be entitled, to the fullest extent permitted by law, to a decree
or order restraining and enjoining such Transfer and the Member shall,
to the fullest extent permitted by law, not plead in defense thereto
that there would be an adequate remedy at law; it being hereby expressly
acknowledged and agreed that damages at law will be an inadequate remedy
for a breach or threatened breach of the violation of the provisions
concerning transfer set forth in this Agreement.
(c) The Special Member shall not have any right to assign or
transfer its limited liability company interest, if any, or rights as
Special Member. Such limited liability company interest, if any, and
rights of the Special Member shall belong solely to and be exercised
solely by the Special Member.
SECTION 26. RESIGNATION. So long as any Obligation is outstanding or
amounts are owed by the Company under any Basic Document and for a period of one
year and one day thereafter, the Member and the Special Member may not resign,
except as permitted under the Basic Documents. If the Member is permitted to
resign pursuant to this Section 26, an additional Member or Special Member of
the Company, as applicable, shall be admitted to the Company, subject to Section
27, upon its execution of an instrument signifying its agreement to be bound by
the terms and conditions of this Agreement, which instrument may be a
counterpart signature page to this Agreement. Such admission shall be deemed
effective immediately prior to the resignation and immediately following such
admission, the resigning Member shall cease to be a Member of the Company.
SECTION 27. ADMISSION OF ADDITIONAL MEMBERS. One or more additional
Members of the Company may be admitted to the Company with the written consent
of the Member and the Special Member; provided, however, that, notwithstanding
the foregoing, so long as any Obligations remain outstanding and for a period of
one year and one day thereafter, no additional Member may be admitted to the
Company.
SECTION 28. DISSOLUTION.
(a) Subject to Section 11(b), the Company shall be dissolved,
and its affairs shall be wound up upon the first to occur of the
following: (i) the expiration of the Term set forth in Section 3 hereof,
(ii) the entry of a decree of judicial dissolution under Section 18-802
of the Act, (iii) the written consent of the Member, or (iv) at any time
there are no Members of the Company unless the Company is continued
without dissolution in accordance with this Agreement or the Act. Upon
the occurrence of any event that causes the last remaining Member of the
Company to cease to be a Member of the Company, to the fullest extent
permitted by law, the personal representative of such member is hereby
authorized to, and shall, within 90 days after the occurrence of the
event that terminated the continued membership of such Member in the
Company, agree in writing (A) to continue the Company and (B) to the
admission of the personal representative or its nominee or designee, as
the case may be, as a substitute Member of the Company, effective as of
the occurrence of the event that terminated the continued membership of
the last remaining Member in the Company.
13
(b) Notwithstanding any other provision of this Agreement, the
Bankruptcy of the Member or the Special Member shall not cause the
Member or the Special Member, respectively, to cease to be a member of
the Company and upon the occurrence of such an event, the business of
the Company shall continue without dissolution.
(c) In the event of dissolution, the Company shall conduct only
such activities as are necessary to wind up its affairs (including the
sale of the assets of the Company in an orderly manner), and the assets
of the Company shall be applied in the manner, and in the order of
priority, set forth in Section 18-804 of the Act.
(d) The Company shall terminate when (i) all of the assets of
the Company, after payment of or due provision for all debts,
liabilities and obligations of the Company, shall have been distributed
to the Member in the manner provided for in this Agreement and (ii) the
Certificate of Formation shall have been canceled in the manner required
by the Act.
SECTION 29. WAIVER OF PARTITION; NATURE OF INTEREST. Except as otherwise
expressly provided in this Agreement, to the fullest extent permitted by law,
the Member and the Special Member, on behalf of themselves, their successors and
their assigns, hereby irrevocably waive any right or power that either of them
might have to cause the Company or any of its assets to be partitioned, to cause
the appointment of a receiver for all or any portion of the assets of the
Company, to compel any sale of all or any portion of the assets of the Company
pursuant to any applicable law or to file a complaint or to institute any
proceeding at law or in equity to cause the dissolution, liquidation, winding up
or termination of the Company. The Member and the Special Member further agree
not to petition on behalf of the Company or initiate any other proceeding
seeking liquidation, reorganization or other relief with respect to itself or
their debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect. The Member and the Special Member agree that this Section
may be pleaded as a bar to the maintenance of such action. The Member and the
Special Member shall not have any interest in any specific assets of the
Company, and the Member and the Special Member shall not have the status of a
creditor with respect to any distribution pursuant to Section 20 hereof. The
interest of the Member and the Special Member, if any, in the Company is
personal property.
SECTION 30. BENEFITS OF AGREEMENT; NO THIRD-PARTY RIGHTS. None of the
provisions of this Agreement shall be for the benefit of or enforceable by any
creditor of the Company or by any creditor of the Member or the Special Member.
Subject to Section 33 hereof, nothing in this Agreement shall be deemed to
create any right in any Person (other than Covered Persons) not a party hereto,
and this Agreement shall not be construed in any respect to be a contract in
whole or in part for the benefit of any third Person.
14
SECTION 31. SEVERABILITY OF PROVISIONS. Each provision of this Agreement
shall be considered severable and if for any reason any provision or provisions
herein are determined to be invalid, unenforceable or illegal under any existing
or future law, such invalidity, unenforceability or illegality shall not impair
the operation of or affect those portions of this Agreement which are valid,
enforceable and legal.
SECTION 32. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof.
SECTION 33. BINDING AGREEMENT. Notwithstanding any other provision of
this Agreement, the Member agrees that this Agreement, including, without
limitation, Sections 9, 11, 14, 24, 25, 26, 27, 28, 30, 33 and 37, constitutes a
legal, valid and binding agreement of the Member and the Special Member, and is
enforceable against the Member by the Manager and the Special Member in
accordance with its terms. In addition, the Manager shall be an intended
beneficiary of this Agreement.
SECTION 34. GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of Delaware (without regard to conflict of
laws principles), all rights and remedies being governed by said laws.
SECTION 35. WAIVER. No consent or waiver, express or implied, by the
Member or the Special Member to or of any breach or default by the Member or the
Special Member in the performance by such Member or the Special Member of their
respective obligations hereunder shall be deemed or construed to be a consent or
waiver to or of any other breach or default in the performance by such Member or
the Special Member of the same or any other obligations of such Member or the
Special Member hereunder. Failure on the part of the Member or the Special
Member to complain of any act or failure to act of any other Member or the
Special Member or to declare any other Member or the Special Member in default,
irrespective of how long such failure continues, shall not constitute a waiver
by such Member or the Special Member of its rights hereunder. The giving of
consent by the Member or the Special Member in any one instance shall not limit
or waive the necessity to obtain such Member's or the Special Member's consent
in any future instance.
SECTION 36. FURTHER ASSURANCES. Each party hereto agrees to do all acts
and things and to make, execute and deliver such written instruments, as shall
from time to time be reasonably required to carry out the terms and provisions
of this Agreement.
SECTION 37. AMENDMENTS. Subject to Section 11(b), this Agreement may not
be modified, altered, supplemented or amended except pursuant to a written
agreement executed and delivered by the Member and the Special Member.
Notwithstanding anything to the contrary in this Agreement, so long as any
Obligation is outstanding, this Agreement may not be modified, altered,
supplemented or amended except: (a) to cure any ambiguity or (b) to convert or
supplement any provision in a manner consistent with the intent of this
Agreement and the other Basic Documents without prior Rating Agency Confirmation
as defined in the Basic Documents.
15
SECTION 38. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original of this Agreement and
all of which together shall constitute one and the same instrument.
SECTION 39. NOTICES. Any notices required to be delivered hereunder
shall be in writing and personally delivered, mailed or sent by telecopy,
electronic mail or other similar form of rapid transmission, and shall be deemed
to have been duly given upon receipt (a) in the case of the Company, to the
Company at its address in Section 4, (b) in the case of the Member or Special
Member, to the Member or Special Member at its respective address as listed on
Schedule B hereto and (c) in the case of either of the foregoing, at such other
address as may be designated by written notice to the other party.
SECTION 40. EFFECTIVENESS. This Agreement shall be effective as of the
date first set forth above.
16
IN WITNESS WHEREOF, the undersigned, intending to be legally bound
hereby, has duly executed this Limited Liability Company Agreement as of the 1st
day of May, 2002.
NELnet, INC., as SOLE ECONOMIC MEMBER
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Senior Vice President
NELNET STUDENT LOAN FUNDING MANAGEMENT
CORPORATION, as SPECIAL MEMBER
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
-------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
President
Agreed to and consented to by:
NELNET STUDENT LOAN FUNDING MANAGEMENT
CORPORATION, as MANAGER and SPECIAL MEMBER
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
President
17
SCHEDULE A
DEFINITIONS
SECTION 1. DEFINITIONS. When used in this Agreement, the following terms
not otherwise defined herein have the following meanings:
"ACT" means the Delaware Limited Liability Company Act (6 Del. C. ss.
18-101 et seq.), as amended from time to time.
"AFFILIATE" means, with respect any Person, any other Person directly or
indirectly Controlling or Controlled by or under direct or indirect common
Control with such Person.
"AGREEMENT" shall have the meaning set forth in the preamble.
"BANKRUPTCY" means, with respect to any Person, if such Person (a) makes
an assignment for the benefit of creditors; (b) files a voluntary petition in
bankruptcy; (c) is adjudged a bankrupt or insolvent, or has entered against it
an order for relief, in any bankruptcy or insolvency proceeding; (d) files a
petition or answer seeking for itself any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
statute, law or regulation; (e) files an answer or other pleading admitting or
failing to contest the material allegations of a petition filed against it in
any proceeding of this nature; (f) seeks, consents to or acquiesces in the
appointment of a trustee, receiver or liquidator of the Person or of all or any
substantial part of its properties; or (g) if 120 days after the commencement of
any proceeding against the Person seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
statute, law or regulation, if the proceeding has not been dismissed, or if
within 90 days after the appointment without such Person's consent or
acquiescence of a trustee, receiver or liquidator of such Person or of all or
any substantial part of its properties, the appointment is not vacated or
stayed, or within 90 days after the expiration of any such stay, the appointment
is not vacated. The foregoing definition of "Bankruptcy" is intended to replace
and shall supersede and replace the definition of "Bankruptcy" set forth in
Section 18-101(1) and 18-304 of the Act.
"BASIC DOCUMENTS" means all documents and certificates contemplated by
or executed in connection with (i) this Agreement, (ii) the acquisition, sale,
transfer, pledge or disposition of Student Loans and interests therein, (iii)
the formation of one or more Trusts, including, without limitation, the Trust
Agreement, dated as of May 8, 2002, as amended and restated by the Amended and
Restated Trust Agreement, dated as of May 1, 2002, each by and between the
Company, as sponsor, and Wilmington Trust Company, not in its individual
capacity but solely as Delaware trustee and the Indenture of Trust, dated as of
May 1, 2002, between Nelnet Student Loan Trust 2002-1, as issuer, and Zions
First National Bank, as trustee, as the same may be amended and supplemented
from time to time and (iv) the authorization, issuance, sale and delivery of
Securities.
"CERTIFICATE OF FORMATION" means the Certificate of Formation of the
Company filed with the Secretary of State of the State of Delaware on January
25, 2002, as amended or amended and restated from time to time.
"CODE" shall mean the Internal Revenue Code of 1986, as it may be
amended from time to time, or any successor statute thereto.
"COMPANY" shall have the meaning set forth in the preamble.
"COMPANY PROPERTY" means all properties, cash, assets, interests and
rights of any type owned by the Company, including all assets acquired with
Company funds or in exchange for Company Property.
"CONTROL" (including the terms "CONTROLLING" and "CONTROLLED") means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities or general partnership or managing member
interests, by contract or otherwise.
"COVERED PERSONS" has the meaning set forth in Section 24(a).
"FINANCED" when used with respect to Student Loans, shall mean or refer
to Student Loans (a) acquired by a Trust, acting as an issuer under an indenture
or other similar agreement, with proceeds from the sale of Securities or which
proceeds otherwise constitute a part of the trust estate created pursuant to
such indenture or other similar agreement and (b) Student Loans substituted or
exchanged for Financed Student Loans.
"MANAGER" shall mean Nelnet Student Loan Funding Management Corporation,
or its successors appointed hereunder.
"MATERIAL ACTION" means to (i) consolidate or merge the Company with or
into any Person, or sell all or substantially all of the assets of the Company
(other than in the ordinary course of business or as contemplated by the Basic
Documents), (ii)(A) commence any case, proceeding or other action or file a
petition under any existing or future bankruptcy, insolvency or similar law
seeking (1) to adjudicate the Company a bankrupt or insolvent, (2) to have an
order for relief entered with respect to the Company, or (3) reorganization,
arrangement, adjustment, wind-up, liquidation, dissolution, composition or other
relief with respect to the Company or its debts, (B) consent to the institution
of bankruptcy or insolvency proceedings against the Company, (C) seek or consent
to the appointment of a receiver, custodian, liquidator, assignee, trustee,
sequestrator (or other similar official) of the Company or a substantial part of
its property, (D) except as required by law, admit the Company's inability to
pay its debts generally as they become due, (E) fail generally to cause the
Company to pay its debts as such debts become due within the meaning of the
Federal Bankruptcy Code, as determined by a relevant bankruptcy court, (F) make
a general assignment by the Company for the benefit of creditors, or (G)
authorize, take any action in furtherance of, consenting to or acquiesce in any
of the foregoing or any similar action or other proceedings under any United
States Federal or state bankruptcy or insolvency or similar law on behalf of, or
with respect to, the Company, or in connection with the Obligations, a Trust
Agreement, this Agreement or any of the other Basic Documents, or (iii) to the
fullest extent permitted by law, dissolve or liquidate the Company.
"MEMBER" means the NELnet, Inc., and includes any Person (other than the
Special Member) admitted as an additional member of the Company or a substitute
member of the Company pursuant to the provisions of this Agreement.
A-2
"MEMBER INTEREST" means with respect to any Member, (a) that Member's
status as a member of the Company; (b) that Member's right to receive
distributions from the Company; (c) all other rights, benefits and privileges
enjoyed by that Member (under the Act, this Agreement, or otherwise) in its
capacity as a member of the Company, including that Member's rights to vote,
consent and approve and otherwise to participate in the management of the
Company; and (d) all obligations, duties and liabilities imposed on that Member
(under that Act, this Agreement or otherwise) in its capacity as a member of the
Company, including any obligations, if any, to make capital contributions.
"OBLIGATIONS" shall mean the indebtedness, liabilities and obligations
of the Company under or in connection with this Agreement, the other Basic
Documents or any related document in effect as of any date of determination.
"PERSON" means any individual, corporation, partnership, joint venture,
limited liability company, limited liability partnership, association, joint
stock company, trust, unincorporated organization, or other organization,
whether or not a legal entity, and any governmental authority.
"SECURITIES" has the meaning set forth in Section 9(b) hereof.
"SPECIAL DIRECTOR" has the meaning set forth in the definition of
Special Member.
"SPECIAL MEMBER" shall mean initially, Nelnet Student Loan Funding
Management Corporation, a Nevada corporation, and any other corporation (a)
which has two duly appointed directors (each a "Special Director" and
collectively, the "Special Directors") each of whom that when a director of the
corporation and at any time during the preceding five years: (i) is not and has
not been (A) a shareholder, officer, director, partner or employee or a
significant customer, creditor, supplier or independent contractor of the
corporation, the Company, its ultimate parent or any subsidiaries or Affiliates
(with the exception of serving as an independent director or in a similar
capacity for other affiliated corporations whose articles of incorporation are
designed to cause such corporations to be bankruptcy remote, special purpose
corporations) thereof or (B) a member of the immediate family of any person
described above and (ii) does not directly or indirectly own any class of voting
stock of the corporation, the Company or any of its Affiliates, a Member or any
other Affiliates of a Member and (b) the articles of incorporation of which are
substantially similar to those of Nelnet Student Loan Funding Management
Corporation.
"STUDENT LOAN" shall mean any loan made to finance post-secondary
education that is made under the Higher Education Act of 1965, as amended or
supplemented from time to time, or any successor federal act and all
regulations, directives, bulletins and guidelines promulgated from time to time
thereunder.
"TRUST" has the meaning set forth in Section 9(b) hereof.
"TRUST AGREEMENT" has the meaning set forth in Section 9(b) hereof.
"TRANSFER" shall have the meaning set forth in Section 25(a).
A-3
SECTION 2. RULES OF CONSTRUCTION. Definitions in this Agreement apply
equally to both the singular and plural forms of the defined terms. The words
"include" and "including" shall be deemed to be followed by the phrase "without
limitation." The terms "herein", "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Section, paragraph or subdivision. The Section titles appear as a matter of
convenience only and shall not affect the interpretation of this Agreement. All
Section, paragraph, clause, Exhibit or Schedule references not attributed to a
particular document shall be references to such parts of this Agreement.
A-4
SCHEDULE B
MEMBER AND SPECIAL MEMBER
MEMBER
AGREED VALUE
OF CAPITAL MEMBERSHIP
NAME MAILING ADDRESS CONTRIBUTION INTEREST
NELnet, Inc. ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, $10.00 100%
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
SPECIAL MEMBER
AGREED VALUE
OF CAPITAL MEMBERSHIP
NAME MAILING ADDRESS CONTRIBUTION INTEREST
Nelnet Student Loan Funding ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, -- ▇%
Management Corporation ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
