Document:

Document

Exhibit 10.7

SECOND AMENDMENT TO CREDIT AGREEMENT

THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Second Amendment”) is made and entered into as of the 18th day of February 2022, by and among JAMES RIVER GROUP HOLDINGS, LTD., a Bermuda company, and JRG REINSURANCE COMPANY LTD., a regulated insurance company domiciled in Bermuda (each a “Borrower” and, collectively, the “Borrowers”), and BMO HARRIS BANK N.A., as Lender (“Lender”).
Recitals:
A.    The Borrowers and the Lender are the parties to that certain Credit Agreement dated as of August 2, 2017 (as amended by the First Amendment dated as of November 8, 2019 and as otherwise previously amended, supplemented or otherwise modified, the “Credit Agreement”), pursuant to which, inter alia, the Lender agreed, subject to the terms and conditions thereof, to advance Loans to the Borrowers and to issue Letters of Credit.
B.    Parent intends to issue preferred equity in an amount not to exceed $150,000,000.
C.    The Borrowers have requested the Lenders to agree to certain amendments to the Credit Agreement to accommodate the issuance of the preferred equity; and upon and subject to the terms and conditions of this Second Amendment, the Lender has agreed with such request.

Agreements:
NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual agreements hereinafter set forth, the Borrowers and the Lender intending to be legally bound, hereby agree as follows:
1.Definitions; Interpretation.
(a)    Terms Defined in Credit Agreement.  All capitalized terms used in this Second Amendment (including in the recitals hereof) and not otherwise defined herein shall have the meanings assigned to them in the Credit Agreement.
(b)    Interpretation.  The rules of interpretation set forth in Section 1.03 of the Credit Agreement shall be applicable to this Second Amendment and are incorporated herein by this reference.
2.    Amendments to the Credit Agreement.  
(a)    Upon satisfaction of the conditions set forth in Section 3 hereof, the Credit Agreement is hereby amended as follows:
(i)     The definition of the term “Current Redeemable Equity” in Section 1.01 of the Credit Agreement is hereby amended and restated in its entirety to provide as follows:
“Current Redeemable Equity” means any preferred stock or other preferred Equity Interests, which in either case, by its terms or upon the happening of any event or condition, is subject to mandatory redemption (except as a result of a change of control or asset sale so long as any rights to payment of the holders thereof upon the occurrence of a 

change of control or asset sale event shall be subject to the prior repayment in full of the Loans and all other obligations that are accrued and payable under this Agreement or any other Loan Document and the termination of the Commitments) at any time prior to November 8, 2025 (as it exists on any date of determination)
(ii)    Section 1.01 of the Credit Agreement is hereby amended by adding the following definition in the correct alphabetical order:
“2022  Preferred Equity” means the preferred equity issued by Parent in February 2022 for an aggregate issuance price of up to $150,000,000. 
(iii)    Section 6.01(a) of the Credit Agreement is hereby amended by (x) deleting the word “and” at the end of subsection (viii) thereof; (y) amending and restating subsection (ix) thereof in its entirety to provide as follows:
(ix)    additional Debt (excluding the 2022 Preferred Equity) not to exceed $100,000,000 in aggregate principal amount at any time outstanding as to the Parent and its Subsidiaries on a Consolidated basis; provided, however, that the Subsidiary Debt Amount shall not at any time exceed an amount equal to $10,000,000, minus the Guarantor Guaranteed Amount at such time; and
and (z) adding a new subsection (x) thereof which shall provide as follows:
(x)     the 2022 Preferred Equity.
(b)    Upon satisfaction of the conditions set forth in Section 3 hereof, each reference in the Credit Agreement to “this Agreement” and the words “hereof,” “herein,” “hereunder,” or words of like import, shall mean and be a reference to the Credit Agreement as further amended by this Second Amendment.
3.    Amendment Effective Date; Conditions Precedent.  The amendments set forth in Section 2, above, shall not be effective unless and until the date on which all of the following conditions precedent have been satisfied (such date of effectiveness being the “Second Amendment Effective Date”):
(a)    Borrowers’ Certifications.  On the Second Amendment Effective Date, after giving effect to the amendments set forth in Paragraph 2, above, the Borrowers hereby certify that (i) no Default exists, (ii) the representations and warranties of the Borrowers under Article 3 of the Credit Agreement are true and correct in all material respects as of the Second Amendment Effective Date (unless and to the extent that any such representation and warranty is stated to relate solely to an earlier date, in which case such representation and warranty shall have been true and correct in all material respects as of such earlier date), (iii) the execution, delivery and performance of this Second Amendment has been authorized by all necessary corporate or company action, and (iv) the Regulatory Condition Satisfaction remains effective.
(b)    Second Amendment.  The Lender shall have received from each Borrower a counterpart of this Second Amendment signed on behalf of such party.
(c)    Guarantor Confirmations.  James River shall have executed and delivered to the Lender a confirmation of its Payment Guaranty in form and substance reasonably satisfactory to the Lender.
(d)    Fees and Expenses.  The Borrowers shall have paid or caused to be paid to the Lender all fees and other amounts due and payable on or prior to the Second Amendment Effective Date, including, 

to the extent invoiced, reimbursement or payment of all reasonable out-of-pocket expenses (including reasonable and documented fees, charges and disbursements of counsel to the Lender) required to be reimbursed or paid by the Borrowers hereunder or under any other Loan Document.
3.    No Other Modifications.  Except as expressly provided in this Second Amendment, all of the terms and conditions of the Credit Agreement and the other Loan Documents remain unchanged and in full force and effect.
4.    Confirmation of Obligations.  Each Borrower hereby affirms as of the date hereof all of its respective Debt and other obligations to the Lender under and pursuant to the Credit Agreement and each of the other Loan Documents and that such Debt and other obligations are owed to the Lender according to their respective terms.  Each Borrower hereby affirms as of the date hereof that there are no claims or defenses to the enforcement by the Lender of the Debt and other obligations of such Borrower to it under and pursuant to the Credit Agreement or any of the other Loan Documents.
5.    Governing Law; Binding Effect.  THIS SECOND AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
6.    Counterparts.  This Second Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original, but all such counterparts shall constitute one and the same instrument, and all signatures need not appear on any one counterpart.  Any party hereto may execute and deliver a counterpart of this Second Amendment by delivering by facsimile or email transmission a signature page of this Second Amendment signed by such party, and any such facsimile or email signature shall be treated in all respects as having the same effect as an original signature.  Any party delivering by facsimile or email transmission a counterpart executed by it shall promptly thereafter also deliver a manually signed counterpart of this Second Amendment.
9.    Miscellaneous.
(a)    Upon the effectiveness of this Second Amendment, this Second Amendment shall be a Loan Document.
(b)    The invalidity, illegality, or unenforceability of any provision in or obligation under this Second Amendment in any jurisdiction shall not affect or impair the validity, legality, or enforceability of the remaining provisions or obligations under this Second Amendment or of such provision or obligation in any other jurisdiction.
(c)    This Second Amendment and all other agreements and documents executed in connection herewith have been prepared through the joint efforts of all of the parties.  Neither the provisions of this Second Amendment or any such other agreements and documents nor any alleged ambiguity shall be interpreted or resolved against any party on the ground that such party’s counsel drafted this Second Amendment or such other agreements and documents, or based on any other rule of strict construction.  Each of the parties hereto represents and declares that such party has carefully read this Second Amendment and all other agreements and documents executed in connection herewith and therewith, and that such party knows the contents thereof and signs the same freely and voluntarily.  The parties hereby acknowledge that they have been represented by legal counsel of their own choosing in negotiations for and preparation of this Second Amendment and all other agreements and documents executed in connection therewith and that each of them has read the same and had their contents fully explained by such counsel and is fully aware of their contents and legal effect.

(d)    The obligations of the Borrowers hereunder are joint and several, all as more fully set forth in Article 10 of the Credit Agreement.
(e)    Section headings herein are for convenience of reference only, are not part of this Second Amendment and shall not affect the construction of, or be taken into consideration in interpreting, this Second Amendment.
10.    Waiver of Jury Trial.  EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS SECOND AMENDMENT AND ANY LOAN DOCUMENT OR ANY TRANSACTION CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

[No additional provisions are on this page; the page next following is the signature page.]

IN WITNESS WHEREOF, the Borrowers and the Lender have hereunto set their hands as of the date first above written.

BORROWERS

JAMES RIVER GROUP HOLDINGS, LTD.

By:      /s/ Sarah Doran                                   
            Name:  Sarah Doran
            Title:    Chief Financial Officer

JRG REINSURANCE COMPANY LTD.

By:      /s/ Allan Defante                                
            Name:  Allan Defante
            Title:    Chief Financial Officer

LENDER

BMO HARRIS BANK N.A.

By:      /s/ Benjamin Mlot                               
            Name:  Benjamin Mlot
            Title:    DirectorDocument

Exhibit 4.2

DESCRIPTION OF SECURITIES REGISTERED UNDER SECTION 12 OF THE SECURITIES EXCHANGE ACT
OF 1934, AS AMENDED

The following description of registered securities of WEX Inc. (“us,” “our,” “we” or the “Company”) is intended as a summary only and therefore is not a complete description. This description is based upon, and is qualified by reference to, our certificate of incorporation, our by-laws and applicable provisions of the Delaware General Corporation Law (the “DGCL”). You should read our certificate of incorporation and by-laws, which are incorporated by reference as Exhibit 3.1 and Exhibit 3.2, respectively, to the Annual Report on Form 10-K of which this Exhibit 4.4 is a part, for the provisions that are important to you. 

Authorized Capital Stock

Our authorized capital stock consists of 175,000,000 shares of common stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, par value $0.01 per share. Our common stock is registered under Section 12(b) of the Securities Exchange Act of 1934, as amended.

Common Stock

Annual Meeting. Annual meetings of our stockholders are held on the date designated in accordance with our by-laws. Written notice must be mailed to each stockholder entitled to vote not less than ten nor more than 60 days before the date of the meeting. The presence in person or by proxy of the holders of record of one-third of our issued and outstanding shares entitled to vote at such meeting constitutes a quorum for the transaction of business at meetings of the stockholders. Special meetings of the stockholders may be called for any purpose by (i) the board of directors, (ii) the Non-Executive Chairman of the board of directors or the Chairman of the board of directors, if there be one, or (iii) the President, stating the place, date and hour of the meeting and the purpose of such meeting. At all meetings of stockholders at which a quorum is present and at which directors are to be elected, other than in a contested election, the election of directors by our stockholders will be determined by majority voting, meaning a nominee will be elected to the board of directors if the votes cast “for” such nominee’s election by the stockholders exceed the votes cast “against” such nominee’s election (with “abstentions” and “broker non-votes” not counted as votes “for” or “against” such nominee’s election). In a contested election, when a quorum is present, the election of directors by our stockholders will be determined by a plurality of the votes cast by the stockholders entitled to vote on the election. Unless otherwise required by law, our certificate of incorporation or our by-laws, all other questions brought before a meeting of stockholders when a quorum is present shall be decided by the vote of the holders of a majority of the total number of votes of our capital stock represented and entitled to vote thereon.

Voting Rights. Each holder of common stock is entitled to one vote for each share held on all matters to be voted upon by stockholders. The common stock does not have cumulative voting rights.

Dividends. The holders of common stock, after any preferences of holders of any preferred stock, are entitled to receive dividends when and if declared by the board of directors out of legally available funds.

Liquidation and Dissolution. If we are liquidated or dissolved, the holders of our common stock will be entitled to share in our assets available for distribution to stockholders in proportion to the amount of common stock they own. The amount available for common stockholders is calculated after payment of liabilities. Holders of any preferred stock, if any, will receive a preferential share of our assets before the holders of the common stock receive any assets.

Other Rights. Holders of our common stock have no preemptive, subscription, redemption or conversion rights. Holders of shares of the common stock are not required to make additional capital contributions. The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of our preferred stock that we may designate and issue in the future.

Preferred Stock

Under the terms of our certificate of incorporation, our board of directors is authorized to issue shares of “blank check” preferred stock in one or more series. Our board of directors is authorized to fix the designation of the series, the number of authorized shares of the series, dividend rights and terms, conversion rights, voting rights, redemption rights and terms, liquidation preferences and any other rights, powers, preferences and limitations applicable to each series of preferred stock. The authorized shares of our preferred stock are available for issuance without further action by our stockholders, unless such action is required by applicable law or the rules of any stock exchange on which our securities may be listed. The issuance of preferred stock could impede the completion of a merger, tender offer or other takeover attempt.

Provisions of Our Certificate of Incorporation and By-laws and the DGCL That May Have Anti-Takeover Effects

Our certificate of incorporation and by-laws contain several provisions that may make it more difficult for a third party to acquire control of us without the approval of our board of directors.

Board of Directors. Since our IPO, our certificate of incorporation and by-laws provided that our board of directors be divided as nearly equally as possible into three classes, with members of each class serving for staggered three-year terms. At the 2021 annual meeting of stockholders, our stockholders approved a proposal from our board of directors to amend and restate our certificate of incorporation to declassify the board of directors and to provide that the declassification of our board of directors be phased-in commencing with our 2022 annual meeting of stockholders. At the 2022 annual meeting of stockholders, the directors whose terms expire at that meeting shall be elected to hold office for a one-year term expiring at the 2023 annual meeting of stockholders. At the 2023 annual meeting of stockholders, the directors whose terms expire at that meeting shall be elected to hold office for a one-year term expiring at the 2024 annual meeting of stockholders. At the 2024 annual meeting of stockholders, and each annual meeting of stockholders thereafter, all directors shall be elected for a one-year term expiring at the next annual meeting of stockholders. Until the classified board is fully phased-out, these provisions could make it more difficult for a third party to acquire, or discourage a third party from acquiring, us.

Removal of Directors by Stockholders. Our certificate of incorporation and by-laws provide that, until the election of directors at the 2024 annual meeting of stockholders, our directors may only be removed from office for cause by an affirmative vote of the holders of at least 60% of the voting power of our then issued and outstanding capital stock entitled to vote at the election of directors, and thereafter, our directors may be removed from office at any time, with or without cause, by the affirmative vote of a majority of the shares of capital stock outstanding and then entitled to vote at an election of directors.  Under our certificate of incorporation and by-laws, any newly created directorship that results from an increase in the authorized number of directors shall be filled by a majority of the board of directors then in office, provided that a quorum is present, and any other vacancy occurring on the board of directors shall be filled by a majority of the board of directors then in office, even if less than a quorum, or by a sole remaining director. Until the election of directors at the 2024 annual meeting of stockholders, a director elected to fill a newly created directorship resulting from an increase in the authorized number of directors shall hold office until the next election of the class for which such director has been chosen, and any director elected to fill a vacancy will be elected for the unexpired term of his or her predecessor. Furthermore, our by-laws provide that the authorized number of directors may be changed only by the resolution of our board of directors. 

Stockholder Nomination of Directors. Our by-laws provide that a stockholder must notify us in writing of any stockholder nomination of a director, other than a proxy access nomination (as described below), (a) in the case of an annual meeting, not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of stockholders; provided, however, that in the event that the annual meeting is called for a date that is not within 25 days before or after such anniversary date, notice by the stockholder in order to be timely must be so received not earlier than 120 days prior to the annual meeting and not later than the close of business on the later of (A) the 90th day prior to the annual meeting and (B) the 10th day following the day on which notice of the date of the annual meeting was mailed or public disclosure of the date of the annual meeting was made, whichever first occurs; and (b) in the case of a special meeting of stockholders called for the purpose of electing directors, not earlier than 120 days prior to the special meeting and not later than the close of business on the later of (x) the 90th day prior to the special meeting and (y)the 10th day following the day on which notice of the date of the special meeting was mailed or public disclosure of the date of the special meeting was made, whichever first occurs.

In addition, under the “proxy access” provision of our by-laws, a stockholder, or group of no more than 20 stockholders, owning at least 3% of the outstanding shares of our capital stock continuously for at least three years, may nominate and include in our proxy materials for an annual meeting of stockholders director nominees constituting up to two individuals or 20% of the board of directors, whichever is greater (subject to certain limitations further set forth in the by-laws), provided that the stockholder(s) and nominee(s) satisfy the requirements specified in the by-laws, including that notice of a nomination be provided to the Company’s Secretary at the principal executive offices of the Company not less than 120 days nor more than 150 days prior to the first anniversary of the preceding year’s annual meeting.

No Action By Written Consent. Our certificate of incorporation provides that our stockholders may not act by written consent and may only act at duly called meetings of stockholders.

Super-Majority Voting. The DGCL provides generally that the affirmative vote of a majority of the shares entitled to vote on any matter is required to amend a corporation’s certificate of incorporation or by-laws unless a corporation’s certificate of incorporation or by-laws, as the case may be, requires a greater percentage. Our by-laws may be amended or repealed by a majority vote of our entire board of directors or the affirmative vote of the holders of at least 60% of the voting power of the shares entitled to vote at an election of directors. In addition, the affirmative vote of the holders of least 60% of the voting power of the shares entitled to vote at an election of directors shall be required to amend, alter, change or repeal, or to adopt any provision inconsistent with the purpose and intent of Articles V, VII, IX, X and XII of our certificate of incorporation.

Delaware Business Combination Statute. Section 203 of the DGCL is applicable to us. Section 203 could delay, deter or prevent us from entering into an acquisition. Section 203 of the DGCL restricts some types of transactions and business combinations between a corporation and a 15% stockholder. A 15% stockholder is generally considered by Section 203 to be a person owning 15% or more of the corporation’s outstanding voting stock. Section 203 refers to a 15% stockholder as an “interested stockholder.” Section 203 restricts these transactions for a period of three years from the date the stockholder acquires 15% or more of our outstanding voting stock. With some exceptions, unless the transaction is approved by the board of directors and the holders of at least two-thirds of the outstanding voting stock of the corporation, Section 203 prohibits significant business transactions such as:

•a merger with, disposition of significant assets to or receipt of disproportionate financial benefits by the interested stockholder, and

•any other transaction that would increase the interested stockholder’s proportionate ownership of any class or series of our capital stock.

The shares held by the interested stockholder are not counted as outstanding when calculating the two-thirds of the outstanding voting stock needed for approval.

The prohibition against these transactions does not apply if:

•prior to the time that any stockholder became an interested stockholder, the board of directors approved either the business combination or the transaction in which such stockholder acquired 15% or more of our outstanding voting stock, or

•the interested stockholder owns at least 85% of our outstanding voting stock as a result of a transaction in which such stockholder acquired 15% or more of our outstanding voting stock. Shares held by persons who are both directors and officers or by some types of employee stock plans are not counted as outstanding when making this calculation.

Utah industrial bank. As owners of a Utah industrial bank, no entity may acquire direct or indirect control of more than 10% of any class of our voting securities without receiving written approval in the case of the Utah Department of Financial Institutions or having given prior notice, and not received an objection, in the case of the FDIC. Our certificate of incorporation requires that if any stockholder fails to provide us with satisfactory evidence that any of these required approvals have been obtained, we may, or will if required by state or federal regulators, restrict such stockholder’s ability to vote such shares with respect to any matter subject to a vote of our stockholders.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00341-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00341-of-00352.parquet"}]]