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Item
1.02Termination
of a Material Definitive Agreement
On
July5, 2007, MRU Lending, Inc. (“MRUL”), an indirect wholly-owned subsidiary of MRU
Holdings, Inc. (the “Company”) terminated that certain credit agreement dated
February 4, 2005, as amended and supplemented (the “Credit Agreement”) by and
among MRUL, Nomura Credit & Capital, Inc., as agent (“Nomura”), a
subsidiary of Nomura Holdings, Inc., and the institutions from time to time
party thereto as lenders. The Company and its affiliates have no material
relationship with Nomura or with any other party to the Credit Agreement other
than as set forth in the Credit Agreement.
Under
the
Credit Agreement, the lenders agreed to provide MRUL with a $165 million secured
revolving credit facility for the origination and warehousing of private student
loans. The loans under the Credit Agreement were secured by, among other things,
a lien on all of the student loans financed under the Credit Agreement and
any
other student loans owned by MRUL and not otherwise released, together with
a
pledge of 100% of the capital stock of MRUL. The Credit Agreement contained
terms and provisions (including representations, covenants and conditions)
customary for transactions of that type.
The
Credit Agreement also provided for customary events of default, including
failure to pay principal, interest or fees when due, failure to comply with
covenants, breaches of certain representations and warranties, the bankruptcy
of
MRUL or MRU Lending Holdco LLC (MRUL’s direct parent and wholly-owned subsidiary
of the Company), failure to maintain certain net worth ratios, a material
adverse change in MRUL’s ability to originate student loans, and the Company’s
failure to indirectly own 100% of the outstanding capital stock of MRUL. The
facility had a three year term.
In
connection with the early termination of the Credit Agreement, Nomura agreed
to
waive its rights to be paid all amounts that would otherwise become due and
payable to Nomura upon the early termination of the Credit Agreement with
respect to collateral securing the loans under the Credit Agreement as well
as
waiving all past, present and future fees due (or that may become due) and
payable under the Credit Agreement.
The
foregoing description of the Credit Agreement is not complete and is qualified
in its entirety by reference to the Credit Agreement, which was filed as Exhibit
10.1 to the Company’s Registration Statement on Form SB-2 filed with the
Securities and Exchange Commission on March 22, 2005.
Item
8.01Other
Events.
The
Company and Merrill Lynch Bank USA (“MLBU”) have extended the $175 million
revolving credit facility for the origination and origination and warehousing
of
private student loans through July 31, 2007. The Company and MLBU expect to
close a replacement facility with one of MLBU’s asset-backed commercial paper
vehicles before the expiration of the current credit facility.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant has duly caused this current report to be signed on its behalf by
the
undersigned, thereunto duly authorized.