Exhibit 1.1
NELNET STUDENT LOAN TRUST 2006-3
$2,213,000,000
STUDENT LOAN ASSET-BACKED NOTES
UNDERWRITING AGREEMENT
November 29, 2006
Banc of America Securities LLC
214 North Tryon Street
Charlotte, NC 28255
Barclays Capital Inc.
200 Park Avenue
New York, NY 10166
Citigroup Global Markets Inc.
388 Greenwich Street
New York, NY 10013
as Representatives
Ladies and Gentlemen:
Nelnet Student Loan Funding, LLC, a Delaware limited liability
company
("Nelnet Funding"), proposes to cause Nelnet Student Loan Trust
2006-3, a
Delaware statutory trust (the "Trust"), to sell to Banc of America
Securities
LLC, Barclays Capital Inc. and Citigroup Global Markets Inc.
(together, the
"Representatives"), and the other underwriters listed on Schedule A
attached
hereto (each an "Underwriter", and collectively the
"Underwriters"), pursuant to
the terms of this Underwriting Agreement (the "Agreement"),
$2,213,000,000
aggregate principal amount of the Trust's Student Loan Asset-Backed
Notes, Class
A-1, Class A-2, Class A-3, Class A-4, Class A-5, Class A-6 and
Class B (the
"Notes") in the initial principal amounts set forth on Schedule A
hereto. Zions
First National Bank, a national banking association, will act as
eligible lender
trustee on behalf of the Trust (the "Eligible Lender Trustee"). The
Notes will
be issued under an Indenture of Trust, dated as of December 1, 2006
(the
"Indenture"), among the Trust, the Eligible Lender Trustee and
Zions First
National Bank, a national banking association, as indenture trustee
(the
"Indenture Trustee"). Upon issuance, the Notes will be secured by,
among other
things, Financed Eligible Loans (as defined in the Indenture)
pledged to the
Indenture Trustee and described in the Prospectus (as defined
below). The
Financed Eligible Loans will be master serviced by National
Education Loan
Network, Inc. ("NELN"), a Nevada Corporation, pursuant to a Master
Servicing
Agreement, dated as of December 1, 2006 (the "Servicing
Agreement"), among NELN,
as master servicer and administrator, Nelnet Funding and the Trust.
The Financed
Eligible Loans will be subserviced by Nelnet, Inc. ("Nelnet"), a
Nebraska
corporation, pursuant to a Nelnet, Inc. Subservicing Agreement,
dated as of
December 1, 2006 (the "Subservicing Agreement"), between NELN and
Nelnet.
<PAGE>
This Agreement, the loan purchase agreement, dated as of December
1,
2006 between the Trust and Nelnet Funding (along with the related
Loan Transfer
Addendum, the "Nelnet Funding Purchase Agreement"), the loan
purchase agreement,
dated as of December 1, 2006 between Nelnet Education Loan Funding,
Inc.
("NELF", together with Nelnet Funding, the "Sellers") and Nelnet
Funding (along
with the related Loan Transfer Addendum, the "NELF Purchase
Agreement", and,
together with the Nelnet Funding Purchase Agreement, the "Purchase
Agreements"),
the trust agreement, dated as of December 1, 2006, between Wells
Fargo Delaware
Trust Company, as Delaware trustee (the "Delaware Trustee"), and
Nelnet Funding,
as initial certificateholder and depositor (the "Trust Agreement"),
the
administration agreement, dated as of December 1, 2006, among the
Trust, the
Delaware Trustee, the Indenture Trustee and NELN, as administrator
(the
"Administration Agreement"), the eligible lender trust agreement,
dated as of
May 1, 2002, between Zions First National Bank (in such capacity
the "Eligible
Lender Trustee", and together with the Indenture Trustee, the
"Trustee") and
Nelnet Funding (the "Nelnet Funding Eligible Lender Agreement"),
the Eligible
Lender Trust Agreement, dated as of December 1, 2006, between the
Eligible
Lender Trustee and the Trust (the "Trust Eligible Lender
Agreement", and
together with the Nelnet Funding Eligible Lender Agreement, the
"Eligible Lender
Agreements"), the custodian agreement, dated December 1, 2006,
among the Trust,
the Indenture Trustee, the Eligible Lender Trustee and Nelnet, as
custodian (the
"Custodian Agreement"), the investment agreements, to be dated on
or about
December 5, 2006, between the Trustee and certain investment
providers
(collectively, the "Investment Agreement"), the indemnity
agreement, dated as of
November 29, 2006, among Nelnet and the Representatives and the
other
Underwriters party hereto (the "Indemnity Agreement"), the
Servicing Agreement,
the Subservicing Agreement and the Indenture shall collectively
hereinafter be
referred to as the "Basic Documents."
Capitalized terms used herein without definition shall have the
meanings
ascribed to them in the Indenture or the Prospectus.
Nelnet Funding proposes to cause the Trust, upon the terms and
conditions set forth herein, to sell to each of the Underwriters on
the Closing
Date (as hereinafter defined) the aggregate principal amount of
each Class of
Notes set forth next to the name of each Underwriter on Schedule A
at the rates
and maturities listed on Schedule B hereto.
Nelnet
Funding wishes to confirm as follows this Agreement with the
Underwriters in connection with the purchase and resale of the
Notes.
1. AGREEMENTS TO SELL, PURCHASE AND RESELL. (a) On the Closing
Date,
Nelnet Funding hereby agrees, subject to all the terms and
conditions set forth
herein, to cause the Trust to sell to each of the Underwriters and,
upon the
basis of the representations, warranties and agreements of Nelnet
Funding herein
contained and subject to all the terms and conditions set forth
herein, on the
Closing Date each of the Underwriters severally and not jointly
agrees to
purchase from the Trust, such principal amount of each Class of the
Notes to be
sold on the Closing Date at such respective purchase prices as are
set forth
next to the name of each Underwriter on Schedule A hereto.
2
<PAGE>
(b) It is understood that the Underwriters propose to offer the
Notes for sale to the public (which may include selected dealers)
as set forth
in the Prospectus.
2. DELIVERY OF THE NOTES AND PAYMENT THEREFOR. Delivery to the
Underwriters of and payment for the Notes shall be made at the
offices of Kutak
Rock LLP in Denver, Colorado, at 11:00 a.m., MST, on December 5,
2006 (the
"Closing Date"). The place of such closing and the Closing Date may
be varied by
agreement between the Representatives and Nelnet Funding.
On the Closing Date, the Notes will be delivered to the
Underwriters
against payment of the purchase price therefor to the Trust in
Federal Funds, by
wire transfer to an account at a bank acceptable to the
Representatives, or such
other form of payment as to which the parties may agree. Unless
otherwise agreed
to by Nelnet Funding and the Representatives, each Class of Notes
will be
evidenced by a single global security in definitive form deposited
with the
Trustee as custodian for DTC, and/or by additional definitive
securities, and
will be registered, in the case of the global Classes of Notes, in
the name of
Cede & Co. as nominee of The Depository Trust Company ("DTC"),
and in the other
cases, in such names and in such denominations as the Underwriters
shall request
prior to 1:00 p.m., New York City time, no later than the business
day preceding
the Closing Date. The Notes to be delivered to the Underwriters
shall be made
available to the Underwriters in Denver, Colorado, for inspection
and packaging
not later than 9:30 a.m., Denver time, on the business day
immediately preceding
the Closing Date.
3. REPRESENTATIONS AND WARRANTIES OF NELNET FUNDING. Nelnet
Funding
represents and warrants to each of the Underwriters that:
(a) A registration statement on Form S-3 (No. 333-128658),
including a prospectus and such amendments thereto as may have
been
required to the date hereof, relating to the Notes and the
offering
thereof from time to time in accordance with Rule 415 under the
Securities Act of 1933, as amended (the "Act"), has been filed with
the
Securities and Exchange Commission (the "SEC" or the "Commission")
and
such registration statement, as amended, has become effective;
such
registration statement, as amended, and the prospectus relating to
the
sale of the Notes offered thereby constituting a part thereof, as
from
time to time amended or supplemented (including the base
prospectus, any
prospectus supplement filed with the Commission pursuant to Rule
424(b)
under the Act, the information deemed to be a part thereof pursuant
to
Rule 430A(b) under the Act, and the information incorporated by
reference therein) are respectively referred to herein as the
"Registration Statement" and the "Prospectus" respectively; and
the
conditions to the use
of a registration statement on Form S-3 under the
Act, as set forth in the General Instructions to Form S-3, and
the
conditions of Rule 415 under the Act, have been satisfied with
respect
to the Registration Statement.
3
<PAGE>
(b) On the effective date of the Registration Statement, the
Registration Statement and the Prospectus conformed in all respects
to
the requirements of the Act, the rules and regulations of the SEC
(the
"Rules and Regulations") and the Trust Indenture Act of 1939,
as
amended, and the rules and regulations thereunder (the "Trust
Indenture
Act"), and, except with respect to information omitted pursuant to
Rule
430A of the Act, did not include any untrue statement of a material
fact
or, in the case of the Registration Statement, omit to state
any
material fact required to be stated therein or necessary to make
the
statements therein not misleading and, in the case of the
Prospectus,
omit to state any material fact required to be stated therein
or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and on
the
date of this Agreement, at the "time of sale" (within the meaning
of
Rule 159 under the Act, the "Time of Sale") for the first sale of
the
Notes by the Underwriters, which will occur November 29, 2006 and
on the
Closing Date, the Registration Statement, the Disclosure Package
(as
defined below) and the Prospectus will conform in all respects to
the
requirements of the Act, the Rules and Regulations and the
Trust
Indenture Act, and none of such documents included or will include
any
untrue statement of a material fact or omit to state any material
fact
required to be stated therein or necessary to make the
statements
therein not misleading; provided, however, that the foregoing does
not
apply to statements in or omissions from the Registration
Statement, the
Prospectus or the Disclosure Package, as applicable, based upon
written
information furnished to Nelnet Funding by the Underwriters,
specifically for use therein. As used in this Agreement, the
term
"Disclosure Package" means, collectively, the initial free
writing
prospectus dated November 24, 2006 relating to the Notes (the
"Initial
FWP"), the static pool information within the meaning of Item 1105
of
Regulation AB under the Securities Act (the "Static Pool Data") and
the
Term Sheet dated November 29, 2006 (the "Disclosure
Supplement").
(c) The Commission has not issued and, to the best knowledge of
Nelnet Funding, is not threatening to issue any order preventing
or
suspending the use of the Registration Statement.
(d) As of the Closing Date, each consent, approval,
authorization
or order of, or filing with, any court or governmental agency or
body
which is required to be obtained or made by Nelnet Funding or
its
affiliates for the consummation of the transactions contemplated by
this
Agreement shall have been obtained, except as otherwise provided in
the
Basic Documents.
(e) The Indenture has been duly and validly authorized by
Nelnet
Funding and, upon its execution and delivery by the Trust and
assuming
due authorization, execution and delivery by the Trustee, will be
a
valid and binding agreement of the Trust, enforceable in accordance
with
its terms, except as enforcement thereof may be limited by
bankruptcy,
insolvency or other similar laws affecting creditors' rights
generally
and the Indenture will conform in all material respects to the
description thereof in the Prospectus and the Disclosure Package.
The
Indenture has been duly qualified under the Trust Indenture Act
with
respect to the Notes.
(f) The Notes have been duly authorized by the Trust and the
Notes to be issued on the Closing Date, when executed by the Trust
and
authenticated by the Trustee in accordance with the Indenture,
and
delivered to the Underwriters against payment therefor in
accordance
with the terms hereof, will have been validly issued and delivered,
and
will constitute valid and binding obligations of the Trust entitled
to
the benefits of the Indenture and enforceable in accordance with
their
terms, except as enforcement thereof may be limited by
bankruptcy,
insolvency, moratorium, fraudulent conveyance or other similar
laws
relating to or affecting creditors' rights generally and court
decisions
with respect thereto, and the Notes will conform in all
material
respects to the description thereof in the Prospectus and the
Disclosure
Package.
4
<PAGE>
(g) Nelnet Funding is a limited liability company duly
organized,
validly existing and in good standing under the laws of the State
of
Delaware with full power and authority to own, lease and operate
its
properties and to conduct its business as described in the
Prospectus
and the Disclosure Package and as conducted on the date hereof, and
is
duly registered and qualified to conduct its business and is in
good
standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such
registration or
qualification, except where the failure so to register or qualify
does
not have a material adverse effect on the condition (financial
or
other), business, prospects, properties, net worth or results
of
operations of Nelnet Funding.
(h) Other than as contemplated by this Agreement or as
disclosed
in the Prospectus and the Disclosure Package, there is no broker,
finder
or other party that is entitled to receive from Nelnet Funding or
any of
its affiliates any brokerage or finder's fee or other fee or
commission
as a result of any of the transactions contemplated by this
Agreement.
(i) There are no legal or governmental proceedings pending or
threatened or, to the knowledge of Nelnet Funding contemplated,
against
Nelnet Funding, or to which Nelnet Funding or any of its properties
is
subject, that are not disclosed in the Prospectus and the
Disclosure
Package and which, if adversely decided, would individually or in
the
aggregate have a material adverse effect on the condition
(financial or
other), business, properties or results of operations of Nelnet
Funding,
or would materially and adversely affect the ability of Nelnet
Funding,
or the Trust to perform its obligations under this Agreement and
the
other Basic Documents or otherwise materially affect the issuance
of the
Notes or the consummation of the transactions contemplated hereby
or by
the Basic Documents.
(j) Neither the offer, sale or delivery of the Notes by the
Trust
nor the execution, delivery or performance of this Agreement or
the
Basic Documents by Nelnet Funding or the Trust, nor the
consummation by
Nelnet Funding or the Trust of the transactions contemplated hereby
or
thereby (i) requires or will require any consent, approval,
authorization or other order of, or registration or filing with,
any
court, regulatory body, administrative agency or other
governmental
body, agency or official (except for compliance with the securities
or
Blue Sky laws of various jurisdictions, the qualification of
the
Indenture under the Trust Indenture Act and such other
consents,
approvals or authorizations as shall have been obtained prior to
the
Closing Date) or conflicts or will conflict with or constitutes or
will
constitute a breach of, or a default under, the organizational
documents
of Nelnet Funding or the Trust or (ii) conflicts or will conflict
with
or constitutes or will constitute a breach of, or a default under,
in
any material respect, any agreement, indenture, lease or other
instrument to which Nelnet Funding or the Trust is a party or by
which
Nelnet Funding or the Trust or any of its respective properties may
be
bound, or violates or will violate in any material respect any
statute,
law, regulation or filing or judgment, injunction, order or
decree
applicable to Nelnet Funding or the Trust or any of its
respective
properties, or will result in the creation or imposition of any
lien,
charge or encumbrance upon any property or assets of Nelnet Funding
or
the Trust pursuant to the terms of any agreement or instrument to
which
it is a party or by which it may be bound or to which any of
its
properties is subject other than as contemplated by the Basic
Documents.
5
<PAGE>
(k) Nelnet Funding has all requisite power and authority to
execute, deliver and perform its obligations under this Agreement
and
the other Basic Documents to which it is a party; the execution
and
delivery of, and the performance by Nelnet Funding of its
obligations
under, this Agreement and the other Basic Documents to which it is
a
party have been duly and validly authorized by Nelnet Funding and
this
Agreement and the other Basic Documents have been duly executed
and
delivered by Nelnet Funding and constitute the valid and legally
binding
agreements of Nelnet Funding, enforceable against Nelnet Funding
in
accordance with their respective terms, except as the enforcement
hereof
and thereof may be limited by bankruptcy, insolvency,
moratorium,
fraudulent conveyance or other similar laws relating to or
affecting
creditors' rights generally and court decisions with respect
thereto and
subject to the applicability of general principles of equity, and
except
as rights to indemnity and contribution hereunder and thereunder
may be
limited by federal or state securities laws or principles of
public
policy.
(l) The statements set forth in each of the Initial FWP, the
Disclosure Supplement and the Prospectus under the caption
"Description
of the Notes" insofar as they purport to constitute a summary of
the
terms of the Notes, are accurate, complete and fair.
(m) Nelnet Funding's assignment and delivery of Financed
Eligible
Loans to the order of the Trustee on behalf of the Trust pursuant
to the
Purchase Agreements will vest in the Trustee on behalf of the Trust
all
of Nelnet Funding's right, title and interest therein, subject to
no
prior lien, mortgage, security interest, pledge, adverse claim,
charge
or other encumbrance.
(n) The Trust's assignment of the Financed Eligible Loans to
the
Trustee pursuant to the Indenture will vest in the Trustee, for
the
benefit of the Noteholders, a first priority perfected security
interest
therein, subject to no prior lien, mortgage, security interest,
pledge,
adverse claim, charge or other encumbrance.
(o) The Trust is not, nor as a result of the issuance and sale
of
the Notes as contemplated hereunder will it become, subject to
registration as an "investment company" under the Investment
Company Act
of 1940, as amended.
(p) The representations and warranties made by Nelnet Funding
in
any Basic Document to which Nelnet Funding is a party and made in
any
Officer's Certificate of Nelnet Funding or the Trust will be true
and
correct at the time made and on and as of the Closing Date.
6
<PAGE>
(q) Since the date of the Disclosure Package and Prospectus, no
material adverse change or any development involving a
prospective
material adverse change in, or affecting particularly the business
or
properties of, Nelnet Funding has occurred.
(r) The Trust is not, was not at the Time of Sale and the time
of
the initial "bona fide offer" (within the meaning of Rule 164(h)
under
the Act) and will not be on the Closing Date, an "ineligible
issuer"
(within the meaning of Rule 405 under the Act).
(s) The Trust filed with the Commission pursuant to Rule 433(d)
under the Act (i) the Initial FWP on November 24, 2006 and (ii)
the
Disclosure Supplement on November 29, 2006.
4. AGREEMENTS OF NELNET FUNDING. Nelnet Funding agrees with each of
the
Underwriters as follows:
(a) Nelnet Funding will prepare a supplement to the Prospectus
setting forth the amount of the Notes covered thereby and the
terms
thereof not otherwise specified in the Prospectus, the price at
which
the Notes are to be purchased by the Underwriters, either the
initial
public offering
price or the method by which the price at which the
Notes are to be sold will be determined, the selling concessions
and
reallowances, if any, and such other information as the
Underwriters and
Nelnet Funding deem appropriate in connection with the offering of
the
Notes, and Nelnet Funding will timely file such supplement to
the
Prospectus with the SEC pursuant to Rule 424(b) under the Act,
but
Nelnet Funding will not file any amendments to the Registration
Statement as in effect with respect to the Notes or any amendments
or
supplements to the Prospectus, or any Free Writing Prospectus
(as
defined in Rule 405 under the Act) to the extent required by Rule
433(d)
under the Act, unless
it shall first have delivered copies of such
amendments, supplements or Free Writing Prospectus to the
Underwriters,
with reasonable opportunity to comment on such proposed amendment
or
supplement or if the Underwriters or their counsel shall have
reasonably
objected thereto promptly after receipt thereof; Nelnet Funding
will
immediately advise the Underwriters or the Underwriters' counsel
(i)
when notice is received from the SEC that any post-effective
amendment
to the Registration Statement has become or will become effective
and
(ii) of any order or communication suspending or preventing, or
threatening to suspend or prevent, the offer and sale of the Notes
or of
any proceedings or examinations that may lead to such an order
or
communication, whether by or of the SEC or any authority
administering
any state securities or Blue Sky law, as soon as Nelnet Funding
is
advised thereof, and will use its best efforts to prevent the
issuance
of any such order or communication and to obtain as soon as
possible its
lifting, if issued. The Issuer will comply with the
requirements
applicable to any "issuer free writing prospectus" (as defined in
Rule
433(h)(1) under the Act), including timely filings with the
Commission,
retention where required and legending.
7
<PAGE>
(b) If, at any time following the issuance of an "issuer free
writing prospectus" or when the Prospectus relating to the Notes
is
required to be delivered under the Act, any event occurred or
occurs as
a result of which such "issuer free writing prospectus" would
conflict
with the information in the Registration Statement or the
Prospectus as
then amended or supplemented would include an untrue statement of
a
material fact or omit to state any material fact required to be
stated
therein or necessary to make the statements therein, in the light
of the
circumstances under which they were made, not misleading, or if it
is
necessary at any time to amend or supplement the Prospectus to
comply
with the Act or the Rules and Regulations, Nelnet Funding promptly
will
notify each of the Representatives of such event and will
promptly
prepare and file with the SEC, at its own expense, an "issuer
free
writing prospectus" or an amendment or supplement to such
Prospectus
that will correct such statement or omission or an amendment that
will
effect such compliance. Neither the Representatives' consent to,
nor the
Representatives' delivery of, any such amendment or supplement
shall
constitute a waiver of any of the conditions set forth in Section
7
hereof.
(c) Nelnet Funding will immediately inform the Representatives
(i) of the receipt by Nelnet Funding of any communication from the
SEC
or any state
securities authority concerning the offering or sale of the
Notes and (ii) of any threatened lawsuit or proceeding or of
the
commencement of any lawsuit or proceeding to which Nelnet Funding
is a
party relating to the offering or sale of the Notes.
(d) Nelnet Funding will furnish to the Representatives, without
charge, copies of the Registration Statement (including all
documents
and exhibits thereto or incorporated by reference therein), the
Prospectus, the Disclosure Package, and all amendments and
supplements
to such documents relating to the Notes, in each case as soon
as
reasonably available in such quantities as the Representatives
may
reasonably request.
(e) No amendment or supplement will be made to the Registration
Statement, Disclosure Package or Prospectus (i) prior to having
furnished the Underwriters with a copy of the proposed form of
the
amendment or supplement and giving the Underwriters a
reasonable
opportunity to review the same or (ii) in a manner to which the
Underwriters or their counsel shall reasonably object.
(f) Nelnet Funding will cooperate with the Underwriters and
with
their counsel in connection with the qualification of, or
procurement of
exemptions with respect to, the Notes for offering and sale by
the
Underwriters and by dealers under the securities or Blue Sky laws
of
such jurisdictions as the Underwriters may designate and will file
such
consents to service of process or other documents necessary or
appropriate in order to effect such qualification or
exemptions;
provided that in no event shall Nelnet Funding be obligated to
qualify
to do business in any jurisdiction where it is not now so qualified
or
to take any action which would subject it to service of process
in
suits, other than those arising out of the offering or sale of
the
Notes, in any jurisdiction where it is not now so subject.
(g) Nelnet Funding consents to the use, in accordance with the
securities or Blue Sky laws of such jurisdictions in which the
Notes are
offered by the Underwriters and by dealers, of the Disclosure
Package
and of the Prospectus furnished by Nelnet Funding.
8
<PAGE>
(h) To the extent, if any, that the rating or ratings provided
with respect to the Notes by the rating agency or agencies that
initially rate the Notes is conditional upon the furnishing of
documents
or the taking of any other actions by Nelnet Funding, Nelnet
Funding
shall cause to be furnished such documents and such other actions
to be
taken.
(i) So long as any of the Notes are outstanding, Nelnet Funding
will furnish to the Underwriters (i) as soon as available, a copy
of
each document relating to the Notes required to be filed with the
SEC
pursuant to the Securities Exchange Act of 1934, as amended
(the
"Exchange Act"), or any order of the SEC thereunder, and (ii) such
other
information concerning Nelnet Funding or the Trust as the
Underwriters
may request from time to time.
(j) If this Agreement shall terminate or shall be terminated
after execution and delivery pursuant to any provisions hereof
(otherwise than by notice given by the Representatives terminating
this
Agreement pursuant to Section 9 or Section 10 hereof) or if
this
Agreement shall be terminated by the Representatives because of
any
failure or refusal on the part of Nelnet Funding to comply with
the
terms or fulfill any of the conditions of this Agreement, Nelnet
Funding
agrees to reimburse the Underwriters for all out-of-pocket
expenses
(including fees and expenses of their counsel) reasonably incurred
by
each of them in connection herewith, but without any further
obligation
on the part of Nelnet Funding for loss of profits or otherwise
(except
for the indemnity and contribution provisions of Section 6
hereof).
(k) The net proceeds from the sale of the Notes hereunder will
be
applied substantially in accordance with the description set forth
in
the Prospectus and the Disclosure Package.
(1) Except as stated in this Agreement, the Disclosure Package
and in the Prospectus, Nelnet Funding has not taken, nor will it
take,
directly or indirectly, any action designed to or that might
reasonably
be expected to cause or result in stabilization or manipulation of
the
price of the Notes to facilitate the sale or resale of the
Notes.
(m) For a period from the date of this Agreement until the
retirement of the Notes, Nelnet Funding will deliver to you the
annual
statements of compliance and the annual independent certified
public
accountants' reports furnished to the Trustee pursuant to the
Servicing
Agreement as soon as such statements and reports are furnished to
the
Trustee.
(n) On or before the Closing Date, Nelnet Funding shall mark
its
accounting and other records, if any, relating to the Financed
Eligible
Loans and shall cause NELN and each Seller to mark their
respective
computer records relating to the Financed Eligible Loans to show
the
absolute ownership by the Trustee, as eligible lender of, and
the
interest of the Trust in, the Financed Eligible Loans, and
Nelnet
Funding shall not take, or shall permit any other person to take,
any
action inconsistent with the ownership of, and the interest of the
Trust
in, the Financed Eligible Loans, other than as permitted by the
Basic
Documents.
9
<PAGE>
(o) For the period beginning on the date of this Agreement and
ending 90 days hereafter, none of Nelnet Funding and any entity
affiliated, directly or indirectly, with Nelnet Funding will,
without
the prior written notice to the Underwriters, offer to sell or
sell
notes (other than the Notes) collateralized by FFELP Loans;
PROVIDED,
HOWEVER, that this shall not be construed to prevent the sale of
FFELP
Loans by Nelnet Funding.
(p) If, at the time the Registration Statement became
effective,
any
information shall have been omitted therefrom in reliance upon
Rule
430A under the Act, then, immediately following the execution of
this
Agreement, Nelnet Funding will prepare, and file or transmit for
filing
with the Commission in accordance with such Rule 430A and Rule
424(b)
under the Act, copies of an amended Prospectus containing all
information so omitted.
(q) As soon as practicable, but not later than 16 months after
the date of this Agreement, Nelnet Funding will make generally
available
to its securityholders an earnings statement covering a period of
at
least 12 months beginning after the later of (i) the effective date
of
the Registration Statement, (ii) the effective date of the most
recent
post-effective amendment to the Registration Statement to
become
effective prior to the date of this Agreement and (iii) the date of
the
Nelnet Funding's most recent Annual Report or Form 10-K filed with
the
Commission prior to the date of this Agreement, which will satisfy
the
provisions of Section 11(a) of the Act.
(r) Nelnet Funding will cooperate with the Underwriters in
listing and maintaining the Class A Notes on the Irish Stock
Exchange.
5. REPRESENTATIONS AND WARRANTIES OF THE UNDERWRITERS. Each of
the
Underwriters, severally and not jointly, hereby represents and
warrants to and
agrees with Nelnet Funding, severally and not jointly, that:
(a) it has only communicated or caused to be communicated and will
only
communicate or cause to be communicated any invitation or
inducement to engage
in investment activity (within the meaning of section 21 of the
Financial
Services Markets Act 2000 (the "FSMA")), received by it in
connection with the
issue or sale of the Notes in circumstances in which section 21(1)
of the FSMA
does not apply to the Trust;
(b) it has complied, and will comply, in all material respects,
with all
applicable provisions of the FSMA with respect to anything done by
it in
relation to the Notes in, from or otherwise involving the United
Kingdom;
(c) other than the Prospectus and the Disclosure Package, it has
not,
without the prior written approval of Nelnet Funding, conveyed or
delivered any
written material of any kind to any potential investor in the Notes
that would
constitute (I) a prospectus satisfying the requirements of Rule
430B under the
Act, (II) a Free Writing Prospectus, or (III) any "ABS
informational and
computational material" as defined in Item 1101(a) of Reg AB under
the Act;
provided, however that an Underwriter may have conveyed to one or
more potential
investors written material containing only (i) information
permitted in Rule 134
under the Act and previously or subsequently included in the
Disclosure Package,
(ii) a column or other entry showing the status of the
subscriptions for each
Class of the Notes, (iii) expected pricing parameters of the Notes,
(iv)
weighted average lives of any Class of the Notes, and (v) expected
maturities of
any Class of the Notes, provided that in the case of clauses (i)
through (v) as
such information is posted on a Bloomberg screen or is distributed
via Bloomberg
(or other comparable system), and in the case of clauses (ii)
through (v) such
written material other than the final pricing terms shall not
contain
information that would require the Trust to file such written
material as a Free
Writing Prospectus pursuant to Rule 433 under the Act;
10
<PAGE>
(d) it did not convey the Initial FWP to any potential investor
prior to
November 24, 2006, or convey the Disclosure Supplement to any
potential investor
prior to November 29, 2006, and has not entered into a contract for
the sale of
the Notes prior to the Time of Sale;
(e) each Underwriter will retain all "free writing prospectuses"
that it
used and that were not filed with the SEC for a period of three
years following
the Time of Sale; and
(f) it has
conveyed the Disclosure Package to each investor to which it
has sold the Notes in paper form, by facsimile or electronically in
Adobe
Acrobat format reasonably promptly after receipt by such
Underwriter and prior
to the time it entered into each contract for sale of the
Notes.
6. INDEMNIFICATION AND CONTRIBUTION.
(a) Nelnet Funding agrees to indemnify and hold harmless each
of
the Underwriters and each person, if any, who controls an
Underwriter
within the meaning of Section 15 of the Act or Section 20 of
the
Exchange Act, from and against any and all losses, claims,
damages,
liabilities and expenses (or actions in respect thereof) arising
out of
or based upon any untrue statement or alleged untrue statement of
a
material fact contained in the Registration Statement, the
Prospectus,
the Disclosure Package, or in any amendment or supplement thereto,
or
any preliminary prospectus, or in the case of the Registration
Statement
or in any amendment or supplement thereto, arising out of or based
upon
any omission or alleged omission to state therein a material
fact
required to be stated therein or necessary to make the
statements
therein not misleading, and in the case of the Prospectus, the
Disclosure Package or in any amendment or supplement thereto,
arising
out of or based upon any omission or alleged omission to state
therein a
material fact required to be stated therein or necessary to make
the
statements therein not misleading, in
