Exhibit 10.1

 

Execution version

 

TIME SHARING AGREEMENT

 

This Time Sharing Agreement (this “Agreement”) is dated this 4th day of
February 2009, by and between Sextant Holdings, LLC, a Massachusetts limited
liability company (the “Company”) and The First Marblehead Corporation, a
Delaware corporation (“Lessee”).

 

RECITALS

 

WHEREAS, Company operates and rightfully possesses the aircraft identified in
Section 15 of this Agreement (the “Aircraft”); and

 

WHEREAS, Lessee desires to lease the Aircraft from Company from time to time on
a non-exclusive time-sharing basis as defined in Sections 91.501(b)(6),
91.501(c)(1) and 91.501(d) of the Federal Aviation Regulations  (“FARs”); and

 

WHEREAS, this Agreement is intended to be a time sharing agreement as defined in
Section 91.501(c)(1) of the FAR.

 

NOW, THEREFORE, in consideration of the foregoing, and the other promises
contained herein, and for other good and valuable consideration, the parties,
intending to be legally bound hereby, agree as follows:

 

1.             Non-Exclusive Lease; Term of Lease.  Company agrees to lease the
Aircraft to Lessee on a non-exclusive basis from time to time as mutually agreed
between the parties pursuant to the provisions of FAR 91.501(b)(6),
91.501(c)(1) and 91.501(d) and to provide a fully qualified flight crew for all
operations conducted under this Agreement.   This Agreement shall be effective
on the date set forth above and shall remain in effect until terminated by
either party upon ten (10) days prior written notice to the other.

 

2.             Lease Fee.  Lessee shall pay to Company for each flight conducted
under this Agreement a lease fee (“Lease Fee”) not to exceed the actual expenses
of each specific flight as authorized by FAR Part 91.501(d).  Such actual
expenses shall include and are limited to:

 

(a)           Fuel, oil, lubricants, and other additives;

(b)           Travel expenses of the crew, including food, lodging and ground
transportation;

(c)           Hangar and tie-down costs away from the Aircraft’s base of
operations;

(d)           Insurance obtained for the specific flight;

(e)           Landing fees, airport taxes and similar assessments;

(f)            Customs, foreign permit, and similar fees directly related to the
flight;

(g)           In-flight food and beverages;

(h)           Passenger ground transportation;

(i)            Flight planning and weather contract services; and

(j)            An additional charge equal to 100 percent of the expenses listed
in subparagraph 2(a) above.

 

Lessee shall also be responsible to pay, together with any Lease Fee, applicable
state and federal taxes, fees and charges.

 

3.             Invoicing and Payment.  Company will pay all expenses related to
the operation of the Aircraft when incurred, and will provide an invoice to
Lessee for the Lease Fee determined in accordance with paragraph 2 above as
promptly as practicable following each flight.  Lessee shall pay to Company the
Lease Fee, together with applicable taxes, within fifteen (15) days of receipt
of the invoice.

 

4.             Flight Information.  Lessee will provide Company with requests
for flight time and proposed flight schedules as far in advance of any given
flight as possible, and in any case, at least two (2) business days in advance
of Lessee’s planned departure (unless Company agrees to a shorter notice in

 

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a particular case in its discretion).  Requests for flight time shall be in a
form, whether written or oral, mutually convenient to, and agreed upon by the
parties.  In addition to the proposed schedules and flight times, Lessee shall
provide at least the following information for each proposed flight prior to
scheduled departure as required by the Company or Company’s flight crew:

 

(a)           proposed departure point;

(b)           destination;

(c)           date and time of flight;

(d)           the number, name, and relationship to the Lessee of anticipated
passengers;

(e)           the nature and extent of luggage and/or cargo to be carried;

(f)            the date and time of return flight, if any; and

(g)           any other information concerning the proposed flight that may be
pertinent or required by Company or Company’s flight crew.

 

5.             Flight Scheduling.  Company shall have final authority over the
scheduling of the Aircraft, provided, however, that Company will use reasonable
efforts to accommodate Lessee’s requests and to avoid conflicts in scheduling. 
It is understood that Company shall not be obligated to retain or contract for
additional flight crew or maintenance personnel or equipment in order to
accommodate Lessee’s scheduling requests.

 

6.             Operational Control. The Company shall have and exercise
exclusive operational control of the Aircraft during all phases of all flights
performed under this Agreement, including, without limitation, all flights
during which Lessee and/or Lessee’s guests are on-board the Aircraft. 
Consistent with the Company’s operational control responsibilities, Company
shall be solely responsible to secure maintenance, preventive maintenance and
required or otherwise necessary inspections on the Aircraft, and shall take such
requirements into account in scheduling the Aircraft. No period of maintenance,
preventative maintenance or inspection shall be delayed or postponed for the
purpose of scheduling the Aircraft, unless said maintenance or inspection can be
safely conducted at a later time in compliance with all applicable laws and
regulations, and within the sound discretion of the pilot in command. All flight
operations under this Agreement shall be conducted under Part 91 of the FAR.

 

7.             Authority of Pilot in Command and Flight Crew.   For each flight
conducted under this Agreement, the Aircraft will be under the command of a
qualified flight crew. The pilot in command shall have final and complete
authority to cancel any flight for any reason or condition that in his or her
judgment would compromise the safety of the flight.  Lessee specifically agrees
that the flight crew, in its sole discretion, may terminate any flight, refuse
to commence any flight, or take other action which in the considered judgment of
the pilot in command is necessitated by considerations of safety.  No such
action of the pilot in command shall create or support any liability for loss,
injury, damage or delay to Lessee or any other person.

 

8.             Damages.   Company shall not be liable to Lessee or any other
person for loss, injury, damage or delay occasioned by the delay or failure by
Company to furnish the Aircraft and crew pursuant to this Agreement for any
reason.  Additionally, Lessee waives any and all claims, rights and remedies
against Company arising out of this Agreement (whether express or implied, or
arising by operation or law or in equity) for any special, punitive, exemplary,
indirect, incidental or consequential damages.

 

9.             Lessee’s Covenants, Representations and Warranties.   Lessee
covenants, represents and warrants to the Company that during the term of this
Agreement:

 

(a)           Lessee will use the Aircraft for and on account of Lessee’s own
business use only, and will not use the Aircraft for the purpose of providing
transportation of passengers or cargo for compensation or hire or in violation
of applicable FARs or any agreements entered into by the Company relating to the
Aircraft;

 

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(b)           Lessee will refrain from incurring any mechanics or other lien in
connection with inspection, preventative maintenance, maintenance or storage of
the Aircraft, whether permissible or impermissible under this Agreement, nor
shall there be any attempt by Lessee to convey, mortgage, assign, lease or any
way alienate the Aircraft or create any kind of lien or security interest
involving the Aircraft or do anything or take any action that might mature into
such a lien; and

 

(c)           Lessee will, and will cause any passengers in Lessee’s party to,
abide by and conform to all such laws, governmental and airport orders,
rules and regulations, as shall from time to time be in effect relating in any
way to the use of the Aircraft by a timesharing lessee.

 

10.           Risk of Loss. The Company assumes and shall bear the entire risk
of loss, theft, confiscation, damage to, or destruction of the Aircraft from any
cause whatsoever, except to the extent attributable to the gross negligence or
willful misconduct of Lessee or Lessee’s guests on the Aircraft.

 

11.           Insurance.   The Company shall maintain and have in force and
effect with respect to the Aircraft when used pursuant to this Agreement
insurance coverage of such type and amount not less than that insurance coverage
customarily maintained with respect to the Aircraft when used by the Company. 
Company shall cause Lessee to be added as an additional insured to its aviation
liability coverage.

 

12.           Home Base.  For purposes of this Agreement, the permanent base of
operation of the Aircraft shall be Laurence G Hanscom Field Airport  (KBED),
Bedford, Suffolk County, Massachusetts.

 

13.           Successors and Assigns.  Neither this Agreement nor any party’s
interest herein shall be assignable to any other party whatsoever.  This
Agreement shall inure to the benefit of and be binding upon the parties hereto,
and their respective heirs, representatives, successors and permitted assigns.

 

14.           Governing Law.  This Agreement shall be governed by, and construed
in accordance with, the laws of the State of Massachusetts.

 

15.           The Aircraft.  The following aircraft shall constitute the
“Aircraft” for purposes of this Agreement, and the use thereof shall be subject
to the terms hereof.

 

Type of Aircraft

 

Manufacturer’s Serial Number

 

U.S. Registration No.

 

 

 

 

 

Gulfstream GIV-X (G450)

 

4035

 

N119AD

 

16.           Subordination.   This Agreement is subject and subordinate to the
rights and interests of any person or entity providing financing in respect of
the Aircraft, whether pursuant to a loan, lease or other financing arrangement,
and to the terms of any documents evidencing the same. This Agreement is subject
and subordinate to a certain Aircraft Security Agreement dated April 23, 2008
between VFS Financing, Inc. (the “Bank”) and the Company (the “Security
Agreement”), and the rights and interests of the Bank thereunder and in and to
the Aircraft (including, without limitation, the Bank’s right to repossess the
Aircraft pursuant to the Security Agreement).  Notwithstanding anything to the
contrary contained herein, upon the occurrence and during the continuance of an
Event of Default (as defined in the Security Agreement), this Agreement shall
terminate immediately at the option of the Bank, upon written notice to Lessee
and Bank may exercise its rights and remedies in accordance with the terms and
conditions of the Security Agreement including, without limitation, its right to
terminate this Agreement and take possession of the Aircraft.  The Bank shall be
an intended third party beneficiary of this provision with the right to enforce
the same in its own name.

 

17.           Notices and Communications. All communications, requests and
notices required or permitted by this Agreement shall be in writing and shall be
deemed to have been duly given or made when delivered personally or transmitted
electronically by facsimile, receipt acknowledged, or in the case of documented
overnight delivery service or registered or certified mail, return receipt
requested, delivery charge or postage prepaid, on the date shown on the receipt
therefor, in each case at the address set forth below (or to such other address
as either party shall from time to time designate to the other party):

 

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If to Company:

 

Sextant Holdings, LLC

800 Boylston Street

Suite 1380

Boston, Massachusetts 02199

Attention:  Seth Gelber, Chief Financial Officer

Telephone: (617) 535-0000

Telecopier:  (617) 535-0022

 

If to Lessee:

 

The First Marblehead Corporation

800 Boylston Street, 34th Floor

Boston, Massachusetts 02199

Attention:  Greg Woods, Managing Director

Telephone: (617) 638-2176

Telecopier:  (617) 638-2161

 

18.           Severability.  If any provision of this Agreement is held to be
illegal, invalid or unenforceable, the legality, validity and enforceability of
the other provisions of this Agreement shall not be affected or impaired.

 

19.           Counterparts.  This Agreement may be executed in any number of
counterparts and/or via facsimile or other electronic means, each of which shall
be deemed an original, and all of which shall constitute one and the same
Agreement.

 

20.           Entire Agreement.  This Agreement constitutes the entire
understanding among the parties with respect to its subject matter, and there
are no representations, warranties, rights, obligations, liabilities,
conditions, covenants or agreements among the parties relating thereto other
than as set forth herein.

 

21.           Amendment and Waiver.  This Agreement may be amended only by a
writing duly executed by the parties hereto.  No delay or omission in the
exercise or enforcement of any right or remedy hereunder by either party shall
be construed as a waiver of such right or remedy unless in the form of a writing
signed by the party intended to be bound.

 

22.           TRUTH IN LEASING STATEMENT PURSUANT TO 14 CFR PART 91.23

 

THE AIRCRAFT, A GULFSTREAM MODEL GIV-X (G450) AIRCRAFT BEARING MANUFACTURER’S
SERIAL NUMBER 4035 AND U.S REGISTRATION MARK N119AD HAS BEEN MAINTAINED AND
INSPECTED UNDER FAR PART 91.409(f)(3) DURING THE 12 MONTH PERIOD PRECEDING THE
DATE OF THIS LEASE.

 

SEXTANT HOLDINGS, LLC, A MASSACHUSETTS LIMITED LIABILITY COMPANY, CERTIFIES THAT
THE AIRCRAFT IS IN COMPLIANCE WITH ALL APPLICABLE MAINTENANCE AND INSPECTION
REQUIREMENTS FOR OPERATIONS TO BE CONDUCTED UNDER THIS LEASE.  THE AIRCRAFT WILL
BE MAINTAINED AND INSPECTED UNDER FAR PART 91.409(f)(3) FOR OPERATIONS TO BE
CONDUCTED UNDER THIS LEASE.

 

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SEXTANT HOLDINGS, LLC CERTIFIES AND ACKNOWLEDGES THAT WHENEVER THE AIRCRAFT IS
OPERATED UNDER THIS AGREEMENT, SEXTANT HOLDINGS, LLC SHALL BE KNOWN AS,
CONSIDERED AND SHALL IN FACT BE RESPONSIBLE FOR OPERATIONAL CONTROL OF THE
AIRCRAFT IDENTIFIED AND TO BE OPERATED UNDER THIS LEASE.  EACH PARTY CERTIFIES
THAT IT UNDERSTANDS ITS RESPECTIVE RESPONSIBILITIES, IF ANY, FOR COMPLIANCE WITH
APPLICABLE FEDERAL AVIATION REGULATIONS.  I, THE UNDERSIGNED, SETH GELBER, AS
CHIEF FINANCIAL OFFICER OF SEXTANT HOLDINGS, LLC, CERTIFY THAT IT IS RESPONSIBLE
FOR OPERATIONAL CONTROL OF THE AIRCRAFT FOR OPERATIONS TO BE CONDUCTED UNDER
THIS LEASE AND THAT IT UNDERSTANDS ITS RESPONSIBILITIES FOR COMPLIANCE WITH
APPLICABLE FEDERAL AVIATION REGULATIONS.

 

EACH PARTY UNDERSTANDS THAT AN EXPLANATION OF FACTORS BEARING ON OPERATIONAL
CONTROL AND PERTINENT FEDERAL AVIATION REGULATIONS CAN BE OBTAINED FROM THE
NEAREST FAA FLIGHT STANDARDS DISTRICT OFFICE.

 

THE ADDRESS OF SEXTANT HOLDINGS, LLC IS 800 BOYLSTON STREET, SUITE 1380, BOSTON,
MASSACHUSETTS 02199.

 

[Remainder of page intentionally blank]

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.

 

 

 

SEXTANT HOLDINGS, LLC

 

 

 

 

 

By:

 /s/ Seth Gelber

 

 

Seth Gelber

 

 

Chief Financial Officer

 

 

 

 

 

THE FIRST MARBLEHEAD CORPORATION

 

 

 

 

 

By:

 /s/ William R. Berkley

 

 

William R. Berkley

 

 

Lead Director

 

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INSTRUCTIONS FOR COMPLIANCE WITH “TRUTH IN LEASING” REQUIREMENTS UNDER

FAR § 91.23

 

Within 24 hours after execution of this Time Sharing Agreement:

 

mail a copy of the executed document to the following address via certified
mail, return receipt requested:

 

Federal Aviation Administration

Aircraft Registration Branch

ATTN:  Technical Section

P.O. Box 25724

Oklahoma City, Oklahoma 73125

 

At least 48 hours prior to the first flight to be conducted under this
Agreement:

 

deliver a completed FSDO Notification Letter (sample form attached) containing
the departure airport and proposed time of departure of said first flight by
facsimile to the Flight Standards District Office located nearest the departure
airport

 

Carry a copy of this Time Sharing Agreement in the aircraft at all times.

 

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FSDO Notification Letter

 

Date:

 

 

 

 

Via Facsimile

Fax:

 

Federal Aviation Administration

 

 

 

 

RE:

 

FAR Section 91.23 FSDO Notification

 

 

First Flight Under Time Sharing Agreement of Gulfstream GIV-X (G450), N119AD,
s/n 4035

 

To whom it may concern:

 

Pursuant to the requirements of Federal Aviation regulation Section 91.23(c)(3),
please accept this letter as notification that the first flight of the aircraft
under the above-referenced agreement will depart from
                                           Airport on the            day of
                          , 2008, at approximately            (am/pm) local
time.

 

 

 

Sincerely,

 

 

 

Sextant Holdings, LLC

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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