Current Report


UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of Earliest Event Reported): June 28, 2013

NIC INC.
(Exact name of registrant as specified in its charter)

Delaware

000-26621

52-2077581

(State or other jurisdiction

of incorporation or organization)

(Commission

File Number)

(I.R.S. Employer

Identification No.)


25501 West Valley Parkway, Suite 300
Olathe, Kansas 66061
(Address of principal executive offices, including zip code)

(877) 234-3468
(Registrant's telephone number, including area code)

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))


ITEM 1.01

ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

         On June 28, 2013, NIC Inc. (the “Company”) entered into an amendment to extend its $10 million unsecured revolving credit agreement with Bank of America, N.A. to May 1, 2015. This revolving credit facility is available to finance working capital, issue letters of credit and finance general corporate purposes. The Company can obtain letters of credit in an aggregate amount of $5 million, which reduces the maximum amount available for borrowing under the facility. Interest on amounts borrowed is payable at a base rate or a Eurodollar rate, in each case as defined in the agreement. The base rate is equal to the higher of the Federal Funds Rate plus 0.5% or the bank’s prime rate. Fees on outstanding letters of credit are either 1.50% (if the Company’s consolidated leverage ratio is less than or equal to 1.25:1) or 1.75% (if the Company’s consolidated leverage ratio is greater than 1.25:1) of face value per annum.

         The terms of the agreement provide for customary representations and warranties, affirmative and negative covenants and events of default. The amendment also continues to require the Company to maintain compliance with the following financial covenants (in each case, as defined in the agreement):

●        Consolidated minimum annual EBITDA of at least $12 million, computed quarterly on a rolling 12-month basis;

●        Consolidated tangible net worth of at least $36 million; and

●        Consolidated maximum leverage ratio of 1.5:1.

         A copy of the amendment is furnished with this report on Form 8-K as Exhibit 10.1, and is incorporated by reference herein.

ITEM 7.01

REGULATION FD DISCLOSURE

          On July 1, 2013, NIC Inc. issued a press release announcing that its wholly owned subsidiary, Wisconsin Interactive Network, LLC, has been awarded a contract by the State of Wisconsin to develop eGovernment services and manage the state’s official portal, http://www.wisconsin.gov. The contract has an initial five-year term beginning May 2013, and the state of Wisconsin has five, one-year renewal options that run through 2023. Agreements were recently finalized securing the initial primary funding source for the contract. The press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

The information in Item 7.01 and Exhibit 99.1 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth in such filing.


ITEM 9.01

FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits

Exhibit No.

Description

 

10.1

Amendment No. 3 to Credit Agreement entered into by and between NIC Inc., a Delaware corporation, as the Borrower and Bank of America, N.A., a national banking association, as Lender, dated June 28, 2013

 

99.1

Press release dated July 1, 2013


SIGNATURES

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.

NIC Inc.

 

Date: July 1, 2013

/s/ Stephen M. Kovzan

Stephen M. Kovzan

Chief Financial Officer

Exhibit 10.1

AMENDMENT NO. 3
TO
CREDIT AGREEMENT

THIS AMENDMENT NO. 3 dated as of June 28 th 2013 (this “ Amendment ”), is entered into by and between NIC INC. , a Delaware corporation, as the Borrower (the “ Borrower ”) and BANK OF AMERICA, N.A. , a national banking association, as Lender (the “ Lender ”).  

RECITALS

A.         The Borrower and the Lender have entered into that certain Credit Agreement dated as of May 2, 2007 as amended and modified by that certain Limited Waiver thereto dated July 22, 2008, that certain Amendment No. 1 thereto dated as of May 1, 2009 and that certain Amendment No. 2 thereto dated as of May 1, 2011 (as so amended and modified, the “ Credit Agreement ”).

B.         The Borrower and the Lender have agreed to certain amendments to the Credit Agreement as more fully described herein.

C.         The Amendment is subject to the representations and warranties of the Borrower and upon the terms and conditions set forth in this Amendment.

AGREEMENT

NOW, THEREFORE , in consideration of the foregoing Recitals, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, the Borrower and the Lender hereby agree as follows:

SECTION 1.    DEFINED TERMS.   Capitalized terms used herein but not otherwise defined herein shall have the meaning assigned to such terms in the Credit Agreement.

SECTION 2.    AMENDMENT.

    2.1   Section 1.01 of the Credit Agreement is hereby amended by amending and restating the defined term “ Maturity Date ” to read in its entirety as follows:

 “ Maturity Date ” means May 1, 2015; provided, however, that if such date is not a Business Day, the Maturity Date shall be the immediately preceding Business Day.

SECTION 3.  LIMITATIONS ON AMENDMENT.

    3.1   The amendment set forth in Section 2 above is effective for the purposes set forth herein and will be limited precisely as written and will not be deemed to (a) be a consent to any other amendment, waiver or modification of any other term or condition of the Credit Agreement or any other Loan Document, (b) otherwise prejudice any right or remedy which the Lender may now have or may have in the future under or in connection with the Credit Agreement or any other Loan Document or (c) be a consent to any future amendment, waiver or modification of any other term or condition of the Credit Agreement or any other Loan Document.

NIC Inc. - Amendment No. 3 to Credit Agreement


  3.2   This Amendment is to be construed in connection with and as part of the Loan Documents and all terms, conditions, representations, warranties, covenants and agreements set forth in the Loan Documents, except as herein waived, are hereby ratified and confirmed and will remain in full force and effect.

SECTION 4.    REPRESENTATIONS AND WARRANTIES.   The Borrower represents and warrants to the Lender as follows:

4.1   Each of the Borrower’s current Material Subsidiaries are listed as a party to the Consent to this Amendment or have executed and delivered a Joinder to the Guaranty concurrently with the execution and delivery of this Amendment.

  4.2   Immediately after giving effect to this Amendment the representations and warranties of (i) the Borrower contained in Article V of the Credit Agreement and (ii) each Loan Party contained in each other Loan Document shall be true and correct in all material respects, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date in all material respects, and the representations and warranties contained in subsections (a) and (b) of Section 5.05 of the Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 of the Credit Agreement.

4.3   Immediately after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

SECTION 5.    EXPENSES.   The Borrower agrees to pay to the Lender upon demand, the amount of any and all out-of-pocket expenses, including the reasonable fees and expenses of its counsel, which the Lender may incur in connection with the preparation, documentation, and negotiation of this Amendment and all related documents.

SECTION 6.    REAFFIRMATION .  The Borrower hereby reaffirms its obligations under each Loan Document (as amended hereby) to which it is a party.

SECTION 7.    EFFECTIVENESS.   This Amendment will become effective as of the date hereof upon the execution and delivery of this Amendment, whether the same or different copies, by the Borrower and Lender.

SECTION 8.  GOVERNING LAW. This Amendment will be governed by and will be construed and enforced in accordance with the laws of the State of Missouri applicable to agreements made and prepared entirely within such State; provided that the Lender shall retain all rights arising under federal law.

SECTION 9.    CLAIMS, COUNTERCLAIMS, DEFENSES, RIGHTS OF SET-OFF.   The Borrower hereby represents and warrants to the Lender that it has no knowledge of any facts that would support a claim, counterclaim, defense or right of set-off.

NIC Inc. - Amendment No. 3 to Credit Agreement

2

SECTION 10.    COUNTERPARTS. This Amendment may be signed in any number of counterparts, and by different parties hereto in separate counterparts, with the same effect as if the signatures to each such counterpart were upon a single instrument.  All counterparts will be deemed an original of this Amendment.

IN WITNESS WHEREOF , the parties hereto have caused this Amendment to be executed as of the date first written above.

BORROWER:

 

NIC INC.

a Delaware corporation

 
 

By:

/s/ William F. Bradley, Jr.

Name:

William F. Bradley, Jr.

Title:

Executive Vice President, Chief

Administrative Officer, General Counsel, and

Secretary

 
 

LENDER:

BANK OF AMERICA, N.A.

 
 

By:

/s/ Gregory S. Bennett

Name:

Gregory S. Bennett

Title:

Vice President

NIC Inc. - Amendment No. 3 to Credit Agreement

3

CONSENT TO AMENDMENT NO. 3
TO CREDIT AGREEMENT

Each of the undersigned is a Guarantor and party to that certain Continuing Guaranty dated May 2, 2007 (the “ Guaranty ”) in favor of Bank of America, N.A. pursuant to which the Guarantors have guaranteed the obligations of NIC INC. to Bank of America, N.A., as Lender and L/C Issuer pursuant to or in connection with that certain Credit Agreement dated May 2, 2007 (as amended, supplemented or otherwise modified from time to time, the “ Credit Agreement ”) and the other Loan Documents (as defined in the Credit Agreement).  Each of the Guarantors hereby consents to Amendment No. 3 to the Credit Agreement effective as of June 28 th , 2013.

Each Guarantor hereby reaffirms its obligations under the Guaranty.

Each of the Guarantors hereby consents to Pennsylvania Interactive, LLC, a Pennsylvania limited liability company, New Jersey Interactive, LLC, a New Jersey limited liability company and NIC Services, LLC, a Colorado limited liability company (the “ New Guarantor ”) joining the Guaranty as a “Guarantor” therein to the same extent as if the New Guarantor had signed the Guaranty as an original party thereto.

IN WITNESS WHEREOF , the Guarantors have caused this Consent to be executed effective as of May 1, 2013.

   

ALABAMA INTERACTIVE, LLC, an Alabama
limited liability company

 

By:

/s/ William F. Bradley, Jr.

Name:

William F. Bradley, Jr.

Title:

Secretary and Manager

 
 

ARKANSAS INFORMATION CONSORTIUM,
LLC, an Arkansas limited liability company

 

By:

/s/ William F. Bradley, Jr.

Name:

William F. Bradley, Jr.

Title:

Secretary and Manager

 
 

COLORADO INTERACTIVE, LLC, a Colorado
limited liability company

 

By:

/s/ William F. Bradley, Jr.

Name:

William F. Bradley, Jr.

Title:

Secretary and Manager

Consent to Amendment No. 3 to Credit Agreement


   

DELAWARE INTERACTIVE, LLC

a West Virginia limited liability company
 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

HAWAII INFORMATION CONSORTIUM,
LLC, a Hawaii limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

IDAHO INFORMATION CONSORTIUM,
LLC, an Idaho limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

INDIANA INTERACTIVE, LLC, an Indiana
limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

IOWA INTERACTIVE, LLC, an Iowa limited
liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

KANSAS INFORMATION CONSORTIUM,
INC., a Kansas corporation

 

By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager

Consent to Amendment No. 3 to Credit Agreement


   

KENTUCKY INTERACTIVE LLC, a Kentucky
limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

LOCAL GOVERNMENT ONLINE INDIANA,
LLC, an Indiana limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

MAINE INFORMATION NETWORK, LLC, a
Maine limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

MONTANA INTERACTIVE, LLC, a Montana
limited liability company

 

By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

NICUSA, INC., a Kansas corporation

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

NIC TECHNOLOGIES, LLC, a Kansas limited
liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager

Consent to Amendment No. 3 to Credit Agreement


   

NEBRASKA INTERACTIVE, LLC, a Nebraska
limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

NEW MEXICO INTERACTIVE, LLC, a New
Mexico limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

OKLAHOMA INTERACTIVE, LLC, an
Oklahoma limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

RHODE ISLAND INTERACTIVE, LLC, a
Rhode Island limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

TEXAS NICUSA, LLC, a Texas limited liability
company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

SOUTH CAROLINA INTERACTIVE, LLC, a
South Carolina limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager

Consent to Amendment No. 3 to Credit Agreement


   

UTAH INTERACTIVE, LLC, a Utah limited
liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

VERMONT INFORMATION CONSORTIUM,
LLC, a Vermont limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

VIRGINIA INTERACTIVE, LLC, a Virginia
limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 
 

WEST VIRGINIA INTERACTIVE, LLC
a West Virginia limited liability company

 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager

Consent to Amendment No. 3 to Credit Agreement


JOINDER TO
CONTINUING GUARANTY

THIS JOINDER TO CONTINUING GUARANTY (this “ Joinder ”) is entered into as of June 28th, 2013 by PENNSYLVANIA INTERACTIVE, LLC , a Pennsylvania limited liability company, NEW JERSEY INTERACTIVE, LLC , a New Jersey limited liability company and NIC SERVICES, LLC , a Colorado limited liability company (the “ New Guarantors ”) in favor of BANK OF AMERICA, N.A. (“ Lender ”).

RECITALS

A.         The Borrower and the Lender have entered into that certain Credit Agreement dated as of May 2, 2007 (as amended, restated or otherwise modified from time to time, the “ Credit Agreement ”).

B.         Certain wholly-owned subsidiaries of the Borrower entered into that certain Continuing Guaranty dated May 2, 2007 (as amended, restated or otherwise modified from time to time, the “ Guaranty ”).

C.         The Credit Agreement requires that any subsidiary of the Borrower that becomes a Material Subsidiary (as defined in the Credit Agreement) must become a party to the Guaranty.

D.         Each New Guarantor is a Material Subsidiary of the Borrower and expects to derive substantial direct and indirect benefit from the Lender continuing its commitment to make Loans and issue Letters of Credit in accordance with the terms and conditions of the Credit Agreement.

AGREEMENT

NOW, THEREFORE , in consideration of the foregoing Recitals, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, and to induce the Lender to enter into the Limited Waiver with the Borrower dated the date hereof, each New Guarantor hereby agree as follows:

SECTION 1.    DEFINED TERMS.   Capitalized terms used herein but not otherwise defined herein shall have the meaning assigned to such terms in the Credit Agreement.

SECTION 2.    JOINDER. Each New Guarantor hereby joins in the Guaranty and agrees to be subject to, and bound by, the terms and provisions of the Guaranty that are ascribed to “Guarantors” therein to the same extent as if such New Guarantor had signed the Guaranty as an original party thereto.

SECTION 3.    REPRESENTATIONS AND WARRANTIES.   Each New Guarantor represents and warrants that (a) it is duly organized and in good standing under the laws of the jurisdiction set forth opposite its name on Schedule A attached hereto and has full capacity and right to make and perform the Guaranty, and all necessary authority has been obtained; (b) the Guaranty constitutes its legal, valid and binding obligation enforceable in accordance with its terms, except as enforceability may be limited by Debtor Relief Laws and subject to equitable principles; (c) the making and performance of the Guaranty does not and will not violate the provisions of any applicable law, regulation or order, and does not and will not result in the breach of, or constitute a default or require any consent under, any material agreement, instrument, or document to which it is a party or by which it or any of its property may be bound or affected; and (d) all consents, approvals, licenses and authorizations of, and filings and registrations with, any governmental authority required under applicable law and regulations for the making and performance of this Guaranty have been obtained or made and are in full force and effect.


IN WITNESS WHEREOF , the New Guarantors have caused this Joinder to be executed as of the date first written above.

BORROWER:

 

PENNSYLVANIA INTERACTIVE, LLC

a Pennsylvania limited liability company
 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 

NEW JERSEY INTERACTIVE, LLC

a New Jersey limited liability company
 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager
 

NIC SERVICES, LLC

a Colorado limited liability company
 
By:

/s/ William F. Bradley, Jr.

Name: William F. Bradley, Jr.
Title: Secretary and Manager

S-1

Joinder

Exhibit 99.1

Wisconsin Signs Contract with NIC to Enhance the Official State Web Portal

MADISON, Wis.--(BUSINESS WIRE)--July 1, 2013--NIC Inc., (NASDAQ: EGOV) the premier provider of official eGovernment services, today announced that the state of Wisconsin has signed agreements with the Company’s wholly owned subsidiary, Wisconsin Interactive Network LLC, to provide self-funded eGovernment services and manage the state’s official web portal, http://www.wisconsin.gov . The five-year agreement extends through 2018, and includes five, one-year renewals that the state can exercise to extend the contract to 2023.

“In other states, NIC has developed hundreds of new eGovernment services that make conducting business with government more secure and efficient. We look forward to bringing these services to our Wisconsin citizens,” said Chris Schoenherr, Wisconsin Department of Administration Deputy Secretary.

The NIC Inc. subsidiary, Wisconsin Interactive Network, will focus on rapidly expanding the library of online services for Wisconsin businesses and citizens, as well as enhancing the transparency, accessibility, and overall eGovernment experience in the state.

“We are excited to be partnering with the state of Wisconsin,” said Harry Herington, NIC Chief Executive Officer and Chairman of the Board. “In addition to developing world class eGovernment services under our self-funded model, our team in Madison looks forward to hiring locally, getting involved in the community, and contributing to the economy.”


Wisconsin is the latest state to partner with NIC, joining Mississippi, Delaware, Oregon, Maryland, and Pennsylvania, which began partnering with NIC over the past two years.

About NIC

NIC Inc. (NASDAQ: EGOV) is the nation's leading provider of official government websites, online services, and secure payment processing solutions. The Company's innovative eGovernment services help reduce costs and increase efficiencies for government agencies, citizens, and businesses across the country. The family of NIC companies provides eGovernment solutions for more than 3,500 federal, state, and local agencies across the United States. Additional information is available at http://www.egov.com .

Cautionary Statement Regarding Forward-Looking Information

Any statements contained in this release that do not relate to historical or current facts constitute forward-looking statements. These statements include statements regarding the company’s potential financial performance for the current fiscal year, statements regarding the planned implementation of new portal contracts and statements regarding continued implementation of NIC’s business model and its development of new products and services. Forward-looking statements are subject to inherent risks and uncertainties and there can be no assurance that such statements will prove to be correct. There are a number of important factors that could cause actual results to differ materially from those suggested or indicated by such forward-looking statements. These include, among others, NIC’s ability to successfully integrate into its operations recently awarded eGovernment contracts; NIC's ability to implement its new portal contracts in a timely and cost-effective manner; NIC’s ability to successfully increase the adoption and use of eGovernment services; the possibility of reductions in fees or revenues as a result of budget deficits, government shutdowns or changes in government policy; the success of the Company in renewing existing contracts and in signing contracts with new states and federal government agencies; continued favorable government legislation; NIC’s ability to develop new services; existing states and agencies adopting those new services; acceptance of eGovernment services by businesses and citizens; competition; the possibility of security breaches through cyber attacks; and general economic conditions and the other important cautionary statements and risk factors described in NIC's 2012 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 28, 2013. Any forward-looking statements made in this release speak only as of the date of this release. NIC does not intend to update these forward-looking statements and undertakes no duty to any person to provide any such update under any circumstances.

CONTACT:
NIC Inc.
Angela Davied, 913-754-7054
Director of Communications
adavied@egov.com