Filed: 15 Dec 20, 4:16pm
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
December 10, 2020
(Exact name of registrant as specified in its charter)
|(State or other jurisdiction of incorporation)||(Commission File Number)||(I.R.S. Employer Identification No.)|
|121 South 13th Street, Suite 100|
|(Address of principal executive offices)||(Zip Code)|
Registrant's telephone number, including area code (402) 458-2370
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
|Title of each class||Trading Symbol||Name of each exchange on which registered|
|Class A Common Stock, Par Value $0.01 per Share||NNI||New York Stock Exchange|
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
On December 10, 2020, each of Nelnet Servicing, LLC (“Nelnet Servicing”) and Great Lakes Educational Loan Services, Inc. (“Great Lakes”), both subsidiaries of Nelnet, Inc. (the “Company”), received a Modification of Contract with an effective date of December 15, 2020 (each a “Modification,” and collectively the “Modifications”) from the United States Department of Education (the “Department”), pursuant to which the Department exercised its option to extend the student loan servicing contracts between the Department and each of Nelnet Servicing and Great Lakes (the “Servicing Contracts”) from December 14, 2020 through June 14, 2021. As previously reported by the Company, Nelnet Servicing and Great Lakes are two of four private sector companies awarded a student loan servicing contract by the Department in June 2009 to provide additional servicing capacity for loans owned by the Department, with additional not-for-profit servicers subsequently added by the Department. Prior to the Modifications, the Servicing Contracts provided for expiration on December 14, 2020, which reflected previous modifications reported by the Company in a Current Report on Form 8-K filed on November 27, 2019. The previous modifications extended the Servicing Contracts through December 14, 2020, provided for the six-month extension at the Department’s discretion through June 14, 2021, and also provide the potential for an additional six-month extension at the Department’s discretion through December 14, 2021. Loan servicing volumes under the Servicing Contracts, as amended by the Modifications, remain subject to the existing terms and conditions of the Servicing Contracts.
Copies of the Modifications received by Nelnet Servicing and Great Lakes are filed as Exhibits 10.1 and 10.2, respectively, to this report.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are filed as part of this report:
|104||Cover Page Interactive Data File (formatted as Inline XBRL and included as Exhibit 101).|
Forward-looking and cautionary statements
This report contains forward-looking statements that involve risks and uncertainties. The words “extend,” “may,” “potential,” and similar expressions, as well as statements in future tense, are intended to identify forward looking statements. These statements are based on management’s current expectations as of the date of this report and are subject to known and unknown risks and uncertainties that may cause actual results or performance to differ materially from those expressed or implied by the forward-looking statements. Such risks include, but are not limited to, risks related to the ability to successfully maintain and increase allocated volumes of student loans serviced by the Company under existing and any future servicing contracts with the Department, which current contracts accounted for 30 percent of the Company's revenue in 2019, risks that the current Servicing Contracts will not be extended beyond June 14, 2021, risks to the Company related to the Department's initiatives to procure new contracts for federal student loan servicing, including the pending and uncertain nature of the Department's NextGen and Interim Servicing Solution procurement processes (under which awards of new NextGen contracts have been made to other service providers), the possibility that awards or evaluations of proposals may be challenged by various interested parties and may not be finalized or implemented within the currently anticipated time frame or at all, risks that the Company may not be successful in obtaining any of such potential new contracts, and risks related to the Company's ability to comply with agreements with third-party customers for the servicing of Federal Direct Loan Program, Federal Family Education Loan Program, and private education and consumer loans.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: December 15, 2020 By: /s/ JAMES D. KRUGER
Name: James D. Kruger
Title: Chief Financial Officer