Exhibit 10.33
AMENDED AND RESTATED AIRCRAFT JOINT OWNERSHIP AGREEMENT
THIS AMENDED AND RESTATED AIRCRAFT JOINT OWNERSHIP AGREEMENT (the “Agreement”)
is made and entered into as of the 30th day of September, 2008, by and between
National Education Loan Network, Inc. (“Nelnet”), and Union Financial Services,
Inc. (“UFS”) (Nelnet and UFS being referred to herein individually as a “Joint
Owner” and collectively as the “Joint Owners”) and is made with reference to the
following:
A. Joint Owners are the registered joint owners, as tenants in common in the
proportions provided for herein, of that certain Cessna Citation VI model
aircraft, Serial No. 650-0232, U.S. Registration No. N711LV (the “Aircraft”).
B. Joint Owners wish to enter into an agreement pursuant to the provisions of
Section 91.501 of the Federal Aviation Regulations for the use, operation and
maintenance of the Aircraft and for the allocation of the costs associated
therewith.
NOW, THEREFORE, in consideration of the premises and of the mutual covenants
contained herein, and intending to be legally bound hereby, the parties agree as
follows:
1. Joint Ownership.
(a) Allocation. Notwithstanding the designation of any Joint Owner as a
registered joint owner of the Aircraft on the records of the Federal Aviation
Administration, the parties agree that all of their respective rights and
obligations with respect to the Aircraft shall be determined solely and entirely
by the terms of this Agreement. Each of the Joint Owners is the owner, as a
tenant in common, of the following undivided interest in the Aircraft (such
interest being referred to herein as the “Ownership Percentage”):

         
Nelnet
    74.753 %
UFS
    25.247 %

(b) Rights to Aircraft. Joint Owners hereby acknowledge that, the Joint Owners,
to the extent of their respective Ownership Percentages own the Aircraft, free
and clear of any lien, security interest or encumbrance of any nature.
2. Relationship of Parties. The relationship among the parties is as tenants in
common of a chattel (the Aircraft). Notwithstanding the foregoing, each Joint
Owner waives any right it may have to demand the partition, or sale for
partition, of the Aircraft under any law of the State of Nebraska, or any other
jurisdiction, and hereby agrees that the sole means by which a Joint Owner may
divest itself of its interest in the Aircraft is as provided for in Section 10
hereof. No partnership, joint venture or other relationship between the parties
whereby any party may be held liable for the acts or omissions of any other
party is intended or created by this Agreement or by virtue of the designation
of any party as a registered joint owner of the Aircraft. Each Joint Owner shall
be entitled to its pro rata share (based on its Ownership Percentage) of the
depreciation, gain, loss or deduction with respect to the Aircraft and shall be
severally liable for all costs and expenses chargeable to such Joint Owner under
the Management Agreement (as defined herein) and incurred with respect to the
Aircraft.

 

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3. Management Agreement. Each Joint Owner agrees that it will enter into an
agreement with Duncan Aviation, Inc. (“Duncan”) to operate and manage the
Aircraft on the Joint Owners’ behalf (the “Management Agreement”). Each Joint
Owner shall perform their respective obligations pursuant to the Management
Agreement during the term of this Agreement. Each Joint Owner hereby
acknowledges that, in order to provide each Joint Owner with sufficient use of
the Aircraft, no Joint Owner shall be entitled to utilize the Aircraft in excess
of such Joint Owner’s Allocated Flight Hours (as defined in Section 5(b) hereof)
during any given year, except to the extent provided for herein or in the
Management Agreement. Each Joint Owner further acknowledges that in the event
any Joint Owner fails to utilize its Allocated Flight Hours during any year
hereunder, such Joint Owner will be deemed to have waived its rights to such
hours thereafter.
4. Representations, Warranties and Covenants. Each Joint Owner represents,
warrants and covenants to the other Joint Owners that the:
(a) Joint Owner is, and for so long as this Agreement remains in effect will be,
a citizen of the United States as described in 49 U.S.C. § 40101, et seq., as
amended;
(b) Joint Owner will not utilize the Aircraft for any illegal purposes or for
purposes of providing transportation of passengers or cargo in air commerce for
compensation or hire except as permitted under Section 91.501 of the Federal
Aviation Regulations;
(c) Joint Owner shall not operate the Aircraft unless appropriate insurance
coverage, as detailed in the Management Agreement, is in effect.
5. Scheduling. Duncan shall have the exclusive right to schedule use of the
Aircraft in accordance with the following criteria:
(a) Use will be scheduled among the Joint Owners, on a “first-come, first
served” basis.
(b) Each Joint Owner will be entitled to use the Aircraft in an amount
consistent with their Ownership Percentages (“Use Amount”) in each twelve
(12) month period, unless otherwise agreed.
(c) Each party shall in any case be responsible for all actual expenses incurred
as a result of its use of the Aircraft. Use of the Aircraft shall be deemed to
commence at the time the Aircraft takes off and shall terminate when the
Aircraft lands at the destination Airport. Flight Hours for one way trips shall
include, as applicable, the time required to return the Aircraft from the point
of destination to Lincoln, Nebraska or the time required to position the
Aircraft from Lincoln, Nebraska to the point of origin.
(d) Subject to the Aircraft’s availability for use by another Joint Owner for
its Use Amount, a Joint Owner may make reasonable use of the Aircraft for more
than the Joint Owner’s Use Amount. In such situations the Joint Owners will
reconcile actual use as compared to Use Amount of the Aircraft on an annual
basis as contemplated by Section 6(b) below.

 

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6. Operating Cost Allocation. The Joint Owners will share the costs of operating
the Aircraft as follows:
(a) Monthly Fixed Cost Payment. The Joint Owners will each make a monthly fixed
cost payment to Duncan as provided for in the Management Agreement. It is agreed
and understood that the proportion of the total monthly fixed costs initially
paid by each Joint Owner is based on the Joint Owner’s respective Ownership
Percentages. If any Joint Owner uses the Aircraft in excess of its annual Use
Amount, as soon as practicable after December 1 of each year, commencing with
December 1, 2008, the Joint Owners will determine the percentage of each Joint
Owner’s actual use of the Aircraft during the 12-month period ending on
November 30 of such year (the “Actual Use Percentage”). If the Actual Use
Percentages are different than the Ownership Percentages, the amount of the
total monthly fixed cost payments made during such 12-month period will be
adjusted among the Joint Owners on the basis of the Actual Use Percentages.
(b) Maintenance, Repair and Refurbishment Costs. Each Joint Owner will be
responsible and liable for its pro-rata portion (based on the Joint Owner’s
Ownership Percentage) of the cost of maintaining, repairing and refurbishing the
Aircraft and its components. To the extent a Joint Owner’s Actual Use Percentage
at the end of a twelve-month period exceeds the Joint Owner’s Ownership
Percentage, the Joint Owners will complete a reconciliation.
(c) Fuel and Out of Pocket Costs. Each Joint Owner will be responsible and
liable to Duncan for the cost of fuel and other consumables in connection with
all flight hours charged to such Joint Owner and for all out-of-pocket expenses
incurred by Duncan in connection with the Joint Owner’s use of the Aircraft such
as, but not limited to, catering, landing fees and crew expenses.
(d) Personal Property Tax. Each Joint Owner will be responsible and liable for,
and will indemnify, defend and hold the other Joint Owners harmless from
liability for, personal property taxes assessed on such Joint Owner’s interest
in the Aircraft.
7. Insurance. Each Joint Owner shall, pursuant to the Management Agreement,
cause Duncan to provide and keep in force a policy or policies of liability
insurance covering Aircraft operations with coverage limits of not less than
$100,000,000 per occurrence, single limit bodily injury and property damage,
including passengers. Each Joint Owner will be endorsed as an additional insured
under such policies. Each Joint Owner shall, pursuant to the Management
Agreement, cause Duncan to obtain hull insurance coverage on the Aircraft in an
amount equal to the value of the Aircraft.
8. Maintenance and Repair. Each Joint Owner shall, pursuant to the Management
Agreement, cause Duncan to be responsible for maintaining the Aircraft in a
serviceable and airworthy condition in accordance with applicable regulations,
requirements and directives. Joint Owners shall not be entitled to any abatement
of their fixed cost payment obligation by reason of the unavailability of the
Aircraft due to the performance of any repair or maintenance activities.

 

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9. Taxes. Each Joint Owner will be responsible for, and will indemnify and hold
the other Joint Owner’s harmless from liability for, any excise, sales or
similar taxes (including interest and penalties) assessed as the result of the
ownership or use of the Aircraft by such Joint Owner.
10. Alienation of Ownership Interest.
(a) Each Joint Owner hereby covenants and agrees that, except as specifically
authorized herein or by agreement of the Joint Owners holding a majority of the
Ownership Percentages, it will not voluntarily encumber, sell, transfer, assign
or otherwise convey, directly or indirectly, any portion of its interest in the
Aircraft to anyone other than a current Joint Owner and that any attempt to do
so will be void and of no force or effect.
(b) In the event a Joint Owner wishes to voluntarily sell or otherwise transfer
all (but not less than all) of its interest in the Aircraft to someone other
than a current Joint Owner, such Joint Owner (the “Selling Joint Owner”) shall
notify the other Joint Owner (the “Buying Joint Owner”) in writing of its
intent. In such event, the Buying Joint Owner shall have the right, but not the
obligation, for a period of thirty (30) days following receipt of such notice to
purchase (for cash or its equivalent) the interest of the Selling Joint Owner in
the Aircraft for an amount equal to the Selling Joint Owner’s pro rata portion
(determined on the basis of its Ownership Percentage) of the Aircraft’s then
current fair market value as determined by mutual agreement. If the Buying Joint
Owner and the Selling Joint Owner are unable to agree on the Aircraft’s fair
market value within thirty (30) days, fair market value will be determined by
three (3) qualified appraisers of used aircraft, one of whom shall be designated
by the Selling Joint Owner, one by the Buying Joint Owner and one by the two
appraisers selected by the Joint Owners. In the event the Buying Joint Owner do
not exercise such right in connection with a proposed voluntary sale or
transfer, the interest of the Selling Joint Owner may be transferred to a third
party provided, however, that such purchaser or transferee, as a condition of
the sale or transfer, shall execute this Agreement and the Management Agreement
and become fully subject to the terms thereof.
(c) In the event of any change in the ownership of the controlling interest in a
Joint Owner or in the event of an attempted involuntary sale or transfer of the
interest of any Joint Owner (in either case, the “Selling Joint Owner”) in the
Aircraft, whether directly or indirectly, the other Joint Owner (the “Buying
Joint Owner”) shall have the right, but not the obligation, for a period of
thirty (30) days following receipt of notice of such change in ownership or
attempted involuntary sale or transfer to purchase (for cash or its equivalent)
the interest of the Selling Joint Owner in the Aircraft for an amount equal to
the Selling Joint Owner’s pro rata portion (determined on the basis of its
Ownership Percentages) of the Aircraft’s then current fair market value as
determined by mutual agreement. If the Buying Joint Owner and the Selling Joint
Owner are unable to agree on the Aircraft’s fair market value within thirty
(30) days, fair market value will be determined by three (3) qualified
appraisers of used aircraft, one of whom shall be designated by the Selling
Joint Owner, one by the Buying Joint Owner and one by the two appraisers
selected by the Joint Owners. In the event the Buying Joint Owner do not
exercise such right in connection with a proposed involuntary sale, the interest
of the Selling Joint Owner may be sold to a third party provided, however, that
such purchaser or transferee, as a condition of the sale or transfer, shall
execute this Agreement and the Management Agreement and become fully subject to
the terms thereof.

 

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11. Term and Termination. This Agreement is effective as of the date first
written above and will continue in effect on a month to month basis until
terminated by mutual agreement. At anytime hereunder, UFS shall have the right
to require Nelnet to purchase UFS’s interest in the Aircraft for an amount equal
to UFS’s pro rata portion (determined on the basis of its Ownership Percentage)
of the Aircraft’s then current fair market value as determined by mutual
agreement. If the parties are unable to agree on the Aircraft’s fair market
value within thirty (30) days, fair market value will be determined by three
(3) qualified appraisers of used aircraft, one of whom shall be designated by
Nelnet, one by UFS and one by the two appraisers selected by the Joint Owners.
If so agreed by the Joint Owners, the Joint Owners shall cause Duncan, as agent
for the Joint Owners, to sell the Aircraft in a commercially reasonable manner.
The net proceeds from such sale will be distributed to each Joint Owner in
proportion to their Ownership Percentages. The good faith decision of Duncan
regarding the terms and conditions of such sale shall be conclusive and binding
on each of the Joint Owners.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

              National Education Loan Network, Inc.   Union Financial Services,
Inc.
 
           
 
           
By:
  /s/ William J. Munn   By:   /s/ Michael S. Dunlap              
 
           
Its:
      Its:                  

 

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