Exhibit 10.23


 


THE FIRST MARBLEHEAD CORPORATION


 


Non-Statutory
Stock Option Agreement


 


1.                                       Grant
of Option.


 


This agreement evidences the grant by The First Marblehead Corporation,
a Delaware corporation (the “Company”), on August 18, 2008 (the “Grant
Date”) to Daniel Maxwell Meyers, an employee of the Company (the “Participant”),
of an option to purchase, in whole or in part, on the terms provided herein, a
total of 2,000,000 shares (the “Shares”) of common stock, $.01 par value per
share, of the Company (“Common Stock”) at $16.00  per Share (the “Exercise Price”).  Unless earlier terminated, this option shall
expire at 5:00 p.m., Eastern Time, on August 17, 2018  (the “Final Exercise Date”).  For purposes of this Agreement, the “Vesting
Commencement Date” shall be August 18, 2008.


 


It is intended that the option evidenced by this agreement shall not be
an incentive stock option as defined in Section 422 of the Internal
Revenue Code of 1986, as amended, and any regulations promulgated thereunder
(the “Code”).  Except as otherwise
indicated by the context, the term “Participant”, as used in this option, shall
be deemed to include any person who acquires the right to exercise this option
validly under its terms.


 


This option is not granted under the Company’s 2003 Stock Incentive
Plan, as amended, or any other stockholder approved stock incentive plan of the
Company.


 


2.                                       Vesting
Schedule.


 


This
option will vest and become fully exercisable upon the occurrence of any of the
following:


 


(a)                                  November 16, 2008;


 


(b)                                 in the event that the closing sale price of the Common
Stock on the New York Stock Exchange (or such other national securities
exchange on which the Common Stock is then traded) is at least 150% of the
Exercise Price for a period of five consecutive trading days (assuming the
trading on such day is not less than 90% of the average daily trading volume
for the three months prior to such five-day period);


 


(c)                                  in the event the Participant dies or becomes
Disabled.  For purposes of this
Agreement, “Disabled” shall mean the Participant is unable to perform the
essential functions of the Participant’s then existing position or positions
with the Company with or without reasonable accommodation for a period of 180
days (which need not be consecutive) in any 12-month period.  If any question shall arise as to whether
during any period the Participant is Disabled so as to be unable to perform the
essential functions of the Participant’s then existing position or positions
with or without reasonable accommodation, the Participant may submit to the
Company a certification in reasonable detail by a physician mutually acceptable
to the Participant or the Participant’s guardian, on the one hand, and the
Company, on the other, as to whether the Participant is so Disabled or how long
such disability is expected to continue, and such certification shall for the
purposes of this agreement be conclusive of the issue; or


 

















 


(d)                                 In the event the Participant’s employment is
terminated by the Company without “Cause” (as defined below) or the Participant
terminates his employment for “Good Reason” (as defined below) and the
Participant enters into a binding general release of claims in favor of the
Company, other than claims with respect to Termination Payments (as defined
below).


 


“Cause”
shall mean:  (i) the willful failure
by the Participant to perform his duties under the Employment Agreement which
has continued for more than 30 days following written notice of such
non-performance from the Board and which failure to perform has had a
materially adverse effect on the financial condition of the Company, (ii) any
act of dishonesty, intentional fraud or willful misconduct on the part of the
Participant in the performance of his duties hereunder, or (iii) the
Participant’s conviction of a felony involving moral turpitude.  For purposes of clause (i) hereof, no
act, or failure to act, on the Participant’s part shall be deemed “willful”
unless done, or omitted to be done, by the Participant without reasonable
belief that the Participant’s act or failure to act, was in the best interest
of the Company.  A determination of Cause
shall only be made at a meeting of the Board called and held for such purpose
if the Board (acting by majority vote of those voting) determines in good faith
that the Executive is guilty of conduct that constitutes Cause as defined
herein.


 


“Good Reason”
shall mean that the Participant has complied with the “Good Reason Process”
(hereinafter defined) following the occurrence of any of the following
events:  (i) a material diminution
in the Participant’s responsibilities, authority or duties; (ii) a
material diminution in the Participant’s Base Salary without the Participant’s
prior written consent; (iii) a material change in the geographic location
at which the Participant provides services to the Company without the
Participant’s prior written consent; or (iv) the material breach of this
Agreement by the Company.  “Good Reason Process” shall mean that (i) the
Participant reasonably determines in good faith that a “Good Reason” condition
has occurred; (ii) the Participant notifies the Company in writing of the
occurrence of the Good Reason condition within 60 days of the occurrence of
such condition; (iii) the Participant cooperates in good faith with the
Company’s efforts, for a period of 30 days following such notice (the “Cure Period”), to remedy the
condition; (iv) notwithstanding such efforts, the Good Reason condition
continues to exist; and (v) the Participant terminates his employment
within 60 days after the end of the Cure Period.  If the Company cures the Good Reason
condition during the Cure Period, Good Reason shall be deemed not to have
occurred.


 


“Termination
Payments” shall mean any payments or benefits to which the
Participant is otherwise entitled under the terms of any employment agreement,
indemnification agreement, equity or bonus agreement with, or benefit plan of,
the Company pursuant to the terms thereof.


 


The right of exercise shall be cumulative so that to the extent the
option is not exercised in any period to the maximum extent permissible it
shall continue to be exercisable, in whole or 


 


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in part, with respect to all Shares for which it is
vested until the earlier of the Final Exercise Date or the termination of this
option under Section 3 hereof.


 


3.                                       Exercise
of Option.


 


(a)                                  Form of Exercise. 
Each election to exercise this option shall be in writing, signed by the
Participant, and received by the Company at its principal office, accompanied
by this agreement, and payment in full in the manner provided in paragraph 3(b) below.  The Participant may purchase less than the
number of shares covered hereby, provided that no partial exercise of this
option may be for any fractional share or for fewer than ten whole shares.


 


(b)                                 Payment Upon Exercise. 
Common Stock purchased upon the exercise of this option shall be paid
for as follows:


 


(i)                                     in cash or by check, payable to the order of the
Company;


 


(ii)                                  to the extent permitted by applicable law, by (x) delivery
of an irrevocable and unconditional undertaking by a creditworthy broker to
deliver promptly to the Company sufficient funds to pay the Exercise Price and
any required tax withholding or (y) delivery by the Participant to the
Company of a copy of irrevocable and unconditional instructions to a
creditworthy broker to deliver promptly to the Company cash or a check
sufficient to pay the Exercise Price and any required tax withholding;


 


(iii)                               to the extent approved by the Board, in its sole
discretion, by delivery (either by actual delivery or attestation) of shares of
Common Stock owned by the Participant valued at their fair market value as
determined by (or in a manner approved by) the Board (“Fair Market Value”),
provided (x) such method of payment is then permitted under applicable
law, (y) such Common Stock, if acquired directly from the Company, was
owned by the Participant for such minimum period of time, if any, as may be
established by the Board in its discretion and (z) such Common Stock is not
subject to any repurchase, forfeiture, unfulfilled vesting or other similar
requirements;


 


(iv)                              to the extent permitted by applicable law and approved
by the Board, in its sole discretion, by payment of such other lawful
consideration as the Board may determine; or


 


(v)                                 by any combination of the above permitted forms of
payment.


 


(c)                                  Termination of Relationship with the
Company.  If the Participant ceases to be an employee,
officer or director of, or consultant or advisor to, the Company or any parent
or subsidiary of the Company as defined in Section 424(e) or (f) of
the Code (an “Eligible Participant”) for any reason, then, except as provided
in paragraphs 3(d), (e) and (f) below,
the right to exercise this option shall terminate  three months after such cessation (but in no event after the
Final Exercise Date), provided that this option shall be
exercisable only to the extent that the Participant was entitled to exercise
this option on the date of such cessation.


 


(d)                                 Exercise Period Upon Death or Disability. 
If the Participant dies or becomes Disabled prior to the Final Exercise
Date while he is an Eligible Participant and the Company has not terminated
such relationship for “Cause” as specified in paragraph 3(f) below, this
option


 


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shall be exercisable, within the period of one year following the date
of death or disability of the Participant by the Participant, provided that
this option shall not be exercisable after the Final Exercise Date.


 


(e)                                  Discharge for Cause. 
If the Participant, prior to the Final Exercise Date, is discharged by
the Company for Cause, the right to exercise this option shall terminate
immediately upon the effective date of such discharge.


 


(f)                                    Termination by Company without Cause or
by Participant for Good Reason.  In the event
the Participant’s employment is terminated by the Company without Cause or the
Participant terminates his employment for Good Reason and the Participant
enters into a binding general release of claims in favor of the Company (other
than any claims with respect to Termination Payments), this option shall be
exercisable until the Final Expiration Date.


 


4.                                       Withholding.


 


No Shares will be issued pursuant to the exercise of this option unless
and until the Participant pays to the Company, or makes provision satisfactory
to the Company for payment of, any federal, state or local withholding taxes
required by law to be withheld in respect of this option.


 


5.                                       Nontransferability
of Option.


 


This option may not be sold, assigned, transferred, pledged or
otherwise encumbered by the Participant, either voluntarily or by operation of
law, except by will or the laws of descent and distribution, and, during the
lifetime of the Participant, this option shall be exercisable only by the
Participant.


 


6.                                       Adjustments
for Changes in Common Stock and Certain Other Events.


 


(a)                                  Changes in Capitalization. 
In the event of any stock split, reverse stock split, stock dividend,
recapitalization, combination of shares, reclassification of shares, spin-off
or other similar change in capitalization or event, or any dividend or
distribution to holders of Common Stock other than an ordinary cash dividend,
the number and class of securities and exercise price per share of this option
shall be equitably adjusted by the Company (or substituted awards may be made,
if applicable) in the manner determined by the Board.  Without limiting the generality of the
foregoing, in the event the Company effects a split of the Common Stock by
means of a stock dividend and the exercise price of and the number of shares
subject to this option are adjusted as of the date of the distribution of the
dividend (rather than as of the record date for such dividend), and if the
Participant exercises this option (in whole or in part) between the record date
and the distribution date for such stock dividend, he shall be entitled to
receive, on the distribution date, the stock dividend with respect to the
shares of Common Stock acquired upon such option exercise, notwithstanding the
fact that such shares were not outstanding as of the close of business on the
record date for such stock dividend.


 


(b)                                 Reorganization Events.


 


(i)                                     “Reorganization Event” shall mean:  (i) any merger or consolidation of the 


 


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Company
with or into another entity as a result of which all of the Common Stock of the
Company is converted into or exchanged for the right to receive cash,
securities or other property or (ii) any exchange of all of the Common
Stock of the Company for cash, securities or other property.


 


(ii)                                  In  connection with a Reorganization Event, this
option shall be assumed, or a substantially equivalent option shall be
substituted, by the acquiring or succeeding corporation or other entity, or an
affiliate thereof that, directly or indirectly, owns and controls 100% of the
equity interests in such acquiring or succeeding corporation or other entity
(any of the foregoing, a “Successor”). 
This option shall be considered assumed if, following consummation of
the Reorganization Event, this option confers the right to purchase at the
Exercise Price, for each share of Common Stock subject to this option
immediately prior to the consummation of the Reorganization Event, the
consideration received as a result of the Reorganization Event by holders of
Common Stock for each share of Common Stock held immediately prior to the
consummation of the Reorganization Event; provided, however, that
if the consideration received as a result of the Reorganization Event is not
solely common stock of a Successor (or equivalent equity interests in any
Successor that is not a corporation), the consideration to be received upon the
exercise of this option shall consist solely of common stock of a Successor (or
equivalent equity interests in any Successor that is not a corporation)
equivalent in value (as determined by the Board in good faith) to the per share
consideration received by holders of outstanding shares of Common Stock as a
result of the Reorganization Event.  For
purposes of this Section 6(b)(ii), “affiliate” shall have the meaning set
forth in Rule 12b-2 promulgated under the Securities Exchange Act of 1934,
as amended.


 


(iii)                               “Roll-In Transaction”
shall mean any transaction, series of transactions or other arrangement
pursuant to which two or more holders of more than 1% but less than all of the
issued and outstanding Common Stock (assuming for these purposes the conversion
of any securities convertible into Common Stock) or other equity interests of the
Company agree or are allowed to exchange or contribute their existing equity (“Participating
Holders”) and in consideration of such exchange or contribution continue,
directly or indirectly through any holding company or other affiliate, as an
equity owner in the Company or its successor in the Reorganization
Transaction.  For purposes of the
definition of Roll-In Transaction in this Section 6(b)(iii), each holder
and any “affiliates” thereof (as such term is defined in Rule 12b-2
promulgated under the Securities Exchange Act of 1934, as amended, but which
term shall also include with respect to any individual holder any trust or
similar entity for the benefit of any spouse or lineal descendant of such
individual) shall be considered as a single holder.


 


(iv)                              With respect to any
Reorganization Event in connection with which there is no “Roll-In Transaction”:
(A) the Participant shall not be entitled to any equitable relief with respect
to any actual or threatened breach or violation of the obligations set forth in
Section 6(b)(ii) (a “Section 6(b)(ii) Breach”) (including,
without limitation, (x) specific performance of such obligations, or (y) an
order or injunction requiring or seeking the rescission of, modification of, or
prevention of the entry into or consummation of, a Reorganization Event or
seeking to prevent any Section 6(b)(ii) Breach, and (B) the
Participant hereby relinquishes and expressly waives any right to seek or
obtain any such equitable relief and hereby expressly acknowledges that his sole
remedy for any Section 6(b)(ii) Breach shall be money damages, but
such money damages shall nonetheless be calculated solely for the purposes of
such calculation as if the 


 


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Participant was entitled to specific performance of the obligations
contained herein, taking into account (by way of example and without
limitation) any negative tax impact to the Participant of a payment of money
damages as compared to such assumed specific performance, and no such calculation
shall be deemed speculative.


 


(v)                                 Notwithstanding any
other provision herein, with respect to any Reorganization Event in connection
with which there is a Roll-In Transaction, provided that the Participant, as a
condition to the assumption or substitution of this option, enters into any
shareholder, stock transfer restriction, put or call, voting or similar
agreement that all Participating Holders execute in connection with such
Roll-In Transaction with respect to the consideration to be received by the
Participant upon the exercise of this option as so assumed or substituted
pursuant to Section 6(b)(ii), the parties expressly acknowledge and agree
that monetary damages would not be an adequate remedy for a Section 6(b)(ii) Breach
and that the Participant shall be entitled to specific performance of the
obligation to have this option assumed or substituted as set forth in Section 6(b)(ii);
provided, however, that the Participant shall nonetheless not be
entitled to an order or injunction requiring or seeking the rescission of,
modification of, or prevention of the entry into or consummation of, such
Roll-In Transaction or seeking to prevent any Section 6(b)(ii) Breach
and the Participant hereby relinquishes and expressly waives any right to seek
or obtain any such order or injunction.


 


(vi)                              Nothing contained in
this agreement shall in any way modify any of the Participant’s rights or
remedies as a holder of Common Stock of the Company, nor shall the Participant’s
exercise of such rights or remedies solely in his capacity as a holder of
Common Stock be deemed a breach or violation of this agreement.


 


7.                                       Miscellaneous.


 


(a)                                  No Right To Employment
or Other Status.  The grant of this
option shall not be construed as giving the Participant the right to continued
employment or any other relationship with the Company.  The Company expressly reserves the right at
any time to dismiss or otherwise terminate its relationship with the
Participant free from any liability or claim under this option, except as
expressly provided herein.


 


(b)                                 No Rights As
Stockholder.  The Participant or
designated beneficiary shall have no rights as a stockholder with respect to
any shares of Common Stock to be distributed with respect to this option until
becoming the record holder of such shares.


 


(c)                                  Governing Law.  The provisions of this agreement shall be
governed by and interpreted in accordance with the laws of State of Delaware,
excluding choice-of-law principles of the law of such state that would require
the application of the laws of a jurisdiction other than such state.


 


(d)                                 Severability.  The invalidity or unenforceability of any
provision of this agreement shall not affect the validity or enforceability of
any other provision of this agreement, and each other provision of this
agreement shall be severable and enforceable to the extent permitted by law.


 


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(e)                                  Entire Agreement.  This agreement constitutes the entire
agreement between the parties, and supersedes all prior agreements and
understandings, relating to the subject matter of this agreement.


 


(f)                                    Amendment.  This agreement may be amended or modified
only by a written instrument executed by both the Company and the employee.


 


[Remainder of Page Intentionally Left Blank; Signature Page Follows.]


 


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IN WITNESS WHEREOF, the Company has caused this
option to be executed under its corporate seal by its duly authorized
officer.  This option shall take effect
as a sealed instrument.


 


	
  THE
  FIRST MARBLEHEAD CORPORATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:
  August 18, 2008

  	
   

  	
  By:

  	
  /s/ William
  R. Berkley

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  William
  R. Berkley

  
	
   

  	
   

  	
  Title: 

  	
  Lead
  Director

  
					



 

















 


PARTICIPANT’S ACCEPTANCE


 


The undersigned hereby accepts the foregoing option
and agrees to the terms and conditions thereof.


 


	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Daniel Meyers

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  Suite
  1380, 800 Boylston St. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Boston,
  MA 02199