þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2009 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE TRANSITION PERIOD FROM TO |
Luxembourg
(State or other jurisdiction of incorporation or organization) |
Not Applicable
(I.R.S. Employer Identification No.) |
|
Title of each class | Name of each exchange on which registered | |
Common Stock, $1.00 par value | The NASDAQ Stock Market |
Large accelerated filer o | Accelerated filer o |
Non-accelerated filer
þ
(do not check if a smaller reporting company) |
Smaller reporting company o |
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9
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11
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ITEM 1.
BUSINESS
For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
26,800
$
28,882
$
38,998
17,444
13,173
14,042
9,194
51
30,464
1,167
19,196
11,683
11,220
$
103,098
$
54,956
$
64,260
$
25,762
$
27,301
$
26,604
13,496
13,173
14,042
4,367
30,464
1,161
$
74,089
$
41,635
$
40,646
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For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
1,770
$
$
14,308
$
16,078
$
$
For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
51,019
$
62,771
$
36,802
13,415
11,064
4,491
$
64,434
$
73,835
$
41,293
$
98
$
1,181
$
1,044
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For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
25,784
$
20,463
$
18,328
21,669
24,820
17,907
$
47,453
$
45,283
$
36,235
$
9,899
$
9,134
$
7,800
10,811
26,012
16,742
$
20,710
$
35,146
$
24,542
(1)
Includes revenue earned from other segments related to RealSuite and IT infrastruture services of $1.8 million and $13.7 million,
respectively in 2008 and $1.5 million and $6.9 million, respectively in 2007.
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Consolidated
United States
India
Other
Altisource
70
1,089
1,159
757
350
2
1,109
11
411
422
28
104
25
157
866
1,954
27
2,847
(1)
We also have approximately 700 employees in India utilized via an outsource agreement
with an unrelated third-party.
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ITEM 1A.
RISK FACTORS
maintain or improve the quality of services that we provide to our customers;
maintain or improve the level of attention expected by our customers; and
successfully leverage our existing client relationships to sell additional services.
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ITEM 1B.
UNRESOLVED STAFF COMMENTS
ITEM 2.
PROPERTIES
ITEM 3.
LEGAL PROCEEDINGS
ITEM 4.
(Removed and Reserved)
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13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
ITEM 5.
MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
2009
Quarter Ended
Low
High
$
10.10
$
14.51
$
14.41
$
21.21
8/10/09
8/31/09
9/30/09
10/31/09
11/30/09
12/31/09
$
100.00
$
117.62
$
118.36
$
125.00
$
132.30
$
172.05
100.00
101.34
104.96
102.89
108.79
110.72
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ITEM 6.
SELECTED FINANCIAL DATA
Years Ended December 31,
(in thousands, except per share data)
2009
2008
2007
2006
2005
$
202,812
$
160,363
$
134,906
$
96,603
$
89,915
126,797
115,048
96,954
72,163
75,675
76,015
45,315
37,952
24,440
14,240
39,473
28,088
27,930
17,622
17,953
36,542
17,227
10,022
6,818
(3,713
)
1,034
(2,626
)
(1,743
)
205
(192
)
37,576
14,601
8,279
7,023
(3,905
)
(11,605
)
(5,382
)
(1,564
)
(1,616
)
2,401
$
25,971
$
9,219
$
6,715
$
5,407
$
(1,504
)
$
1.09
$
0.38
$
0.28
$
0.22
$
(0.06
)
$
1.08
$
0.38
$
0.28
$
0.22
$
(0.06
)
$
94,897
$
64,251
$
59,350
$
51,971
$
41,312
$
4,308
$
6,208
$
8,864
$
9,103
$
9,049
$
1,290
$
2,269
$
965
$
503
$
679
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As of December 31,
(in
thousands)
2009
2008
2007
2006
2005
$
30,456
$
6,988
$
5,688
$
$
30,497
9,077
16,770
7,925
10,403
9,324
11,540
14,797
1,618
1,618
33,719
36,391
38,945
11,408
9,304
12,173
9,826
11,242
120,556
76,675
92,845
22,205
24,706
1,123
147
664
1,356
3,631
3,219
2,603
34,208
16,129
17,171
7,357
8,471
(1)
The operations of NCI are included in our financial statements effective June 6, 2007,
the date of acquisition. NCI is a receivables management company specializing in
contingency collections and customer relationship management for credit card issuers and
other consumer credit providers. Total goodwill and intangibles were $41.4 million, $46.3
million and $52.1 million, at December 31, 2009, 2008 and 2007, respectively. NCI revenues
were $63.1 million, $69.6 million and $36.0 million for the years ended December 31, 2009,
2008 and 2007, respectively. NCI operating expenses (including both cost and revenue and
selling, general and administrative expenses) were $69.0 million, $74.8 million and $38.4
million for the years ended December 31, 2009, 2008 and 2007, respectively.
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ITEM 7.
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Page
17
19
19
19
20
21
22
22
23
23
26
29
31
33
33
34
35
35
35
37
37
38
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$3.4 million of one-time costs associated with the Separation;
$1.9 million of facility closure costs recognized within the Financial Services
segment associated with the closure of two collection facilities;
$2.3 million of settlement gain recognized within the Financial Services
segment; and
$1.4 million of settlement losses recognized in the fourth quarter in the
Financial Services segment with respect to the Noble dialer arbitration.
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Years Ended December 31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
202,812
$
160,363
$
134,906
$
42,449
26
%
$
25,457
19
%
126,797
115,048
96,954
11,749
10
18,094
19
76,015
45,315
37,952
30,700
68
7,363
19
39,473
28,088
27,930
11,385
41
158
1
36,542
17,227
10,022
19,315
112
7,205
72
1,034
(2,626
)
(1,743
)
3,660
139
(883
)
(51
)
37,576
14,601
8,279
22,975
157
6,322
76
(11,605
)
(5,382
)
(1,564
)
(6,223
)
(116
)
(3,818
)
(244
)
$
25,971
$
9,219
$
6,715
$
16,752
182
%
$
2,504
37
%
$
94,897
$
64,251
$
59,350
$
30,646
48
%
$
4,901
8
%
$
4,308
$
6,208
$
8,864
$
(1,900
)
(31
)%
$
(2,656
)
(30
)%
$
1,290
$
2,269
$
965
$
(979
)
(43
)%
$
1,304
135
%
Years Ended December 31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
103,098
$
54,956
$
64,260
$
48,142
88
%
$
(9,304
)
(14
)%
64,434
73,835
41,293
(9,401
)
(13
)
32,542
79
47,453
45,283
36,235
2,170
5
9,048
25
(12,173
)
(13,711
)
(6,882
)
1,538
11
(6,829
)
(99
)
$
202,812
$
160,363
$
134,906
$
42,449
26
%
$
25,457
19
%
$
74,089
$
41,635
$
40,646
$
32,454
78
%
$
989
2
%
98
1,181
1,044
(1,083
)
(92
)
137
13
20,710
35,416
24,542
(14,436
)
(41
)
10,604
43
(1)
Includes revenue earned from other segments related to RealSuite and IT infrastruture services of $1.8 million and $13.7 million,
respectively in 2008 and $1.5 million and $6.9 million, respectively in 2007.
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Completion of our national platform for default services which will allow us to
capture a greater share of revenues related to loans serviced by Ocwen;
Rollout nationally our Title Agency business;
Inclusion of MPA since the February 2010 acquisition date; and
Greater penetration of existing Financial Services clients.
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Years Ended December 31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
8,456
$
8,125
$
7,999
$
331
4
%
$
126
2
%
4,096
6,208
8,864
(2,112
)
(34
)
(2,656
)
(30
)
10,252
3,270
3,121
6,982
214
149
5
16,669
10,485
7,946
6,184
59
2,539
32
$
39,473
$
28,088
$
27,930
$
11,385
41
%
$
158
1
%
18
%
11
%
7
%
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Years ended December 31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
37,576
$
14,601
$
8,279
$
22,975
157
%
$
6,322
76
%
1,644
2,655
1,926
(1,011
)
(38
)
729
38
5,432
7,836
6,979
(2,404
)
(31
)
857
12
2,672
2,554
1,555
118
5
999
64
$
47,324
$
27,646
$
18,739
$
19,678
71
%
$
8,907
48
%
(1)
See
SECTION 3 SEGMENT RESULTS OF OPERATIONS
below for a reconciliation of the most
directly comparable GAAP measure to EBITDA.
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For the Year Ended December 31, 2009
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
(1)
Altisource
$
103,098
$
64,434
$
47,453
$
(12,173
)
$
202,812
60,735
52,871
24,477
(11,286
)
126,797
42,363
11,563
22,976
(887
)
76,015
5,625
19,267
4,731
9,850
39,473
36,738
(7,704
)
18,245
(10,737
)
36,542
31
1,324
(319
)
(2
)
1,034
$
36,769
$
(6,380
)
$
17,926
$
(10,739
)
$
37,576
$
36,769
$
(6,380
)
$
17,926
$
(10,739
)
$
37,576
28
1,314
318
(16
)
1,644
48
2,402
2,906
76
5,432
2,672
2,672
$
36,845
$
8
$
21,150
$
(10,679
)
$
47,324
$
74,089
$
98
$
20,710
$
$
94,897
$
2,712
$
467
$
1,517
$
(388
)
$
4,308
$
30
$
1,029
$
231
$
$
1,290
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For the Year Ended December 31, 2008
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
(1)
Altisource
$
54,956
$
73,835
$
45,283
$
(13,711
)
$
160,363
36,392
62,590
29,777
(13,711
)
115,048
18,564
11,245
15,506
45,315
5,027
17,168
6,118
(225
)
28,088
13,537
(5,923
)
9,388
225
17,227
(58
)
(1,952
)
(391
)
(225
)
(2,626
)
$
13,479
$
(7,875
)
$
8,997
$
$
14,601
$
13,479
$
(7,875
)
$
8,997
$
$
14,601
58
2,025
572
2,655
34
3,202
4,600
7,836
2,554
2,554
$
13,571
$
(94
)
$
14,169
$
$
27,646
$
41,635
$
1,181
$
35,146
$
(13,711
)
$
64,251
$
3,633
$
595
$
1,980
$
$
6,208
$
58
$
1,833
$
378
$
$
2,269
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For the Year Ended December 31, 2007
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
(1)
Altisource
$
64,260
$
41,293
$
36,235
$
(6,882
)
$
134,906
44,158
32,324
27,354
(6,882
)
96,954
20,102
8,969
8,881
37,952
7,876
14,787
6,359
(1,092
)
27,930
12,226
(5,818
)
2,522
1,092
10,022
(90
)
(1,269
)
708
(1,092
)
(1,743
)
$
12,136
$
(7,087
)
$
3,230
$
$
8,279
$
12,136
$
(7,087
)
$
3,230
$
$
8,279
90
1,300
536
1,926
292
980
5,707
6,979
1,555
1,555
$
12,518
$
(3,252
)
$
9,473
$
$
18,739
$
40,646
$
1,044
$
24,542
$
(6,882
)
$
59,350
$
4,507
$
1,817
$
2,540
$
$
8,864
$
90
$
544
$
331
$
$
965
(1)
Intercompany transactions primarily consist of information technology
infrastructure services and charges for the use of certain REAL products from our Technology
Products segment to our other two segments. Generally, we reflect these charges within
technology and communication in the segment receiving the services, except for consulting
services, which we reflect in professional services.
(2)
Includes depreciation and amortization of $2.0 million, $2.8 million and $0.4
million in the years ended December 31, 2009, 2008 and 2007, respectively, for assets
reflected in the Technology Products segment but utilized by the Financial Services segment.
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Years Ended December 31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
103,098
$
54,956
$
64,260
$
48,142
88
%
$
(9,304
)
(14
)%
60,735
36,392
44,158
24,343
67
(7,766
)
(18
)
42,363
18,564
20,102
23,799
128
(1,538
)
(8
)
5,625
5,027
7,876
598
12
(2,849
)
(36
)
$
36,738
$
13,537
$
12,226
$
23,201
171
%
$
1,311
11
%
$
36,845
$
13,571
$
12,518
$
23,274
171
%
$
1,053
8
%
$
74,089
$
41,635
$
40,646
$
32,454
78
%
$
989
2
%
$
2,712
$
3,633
$
4,507
$
(921
)
(25
)%
$
(874
)
(19
)%
$
30
$
58
$
90
$
(28
)
(48
)%
$
(32
)
(36
)%
(1)
See table at the beginning of this section for a reconciliation of the most
directly comparable GAAP measure to EBITDA.
Table of Contents
We expect to complete our national rollout toward the end of 2010. This will
allow us to capture 50 55% of the available referrals from the loan portfolio
serviced by Ocwen (currently we capture 30 35%). We typically generate revenue 1
6 months after the initial referral is placed with us;
Ocwen has sufficient equity to acquire additional portfolios. Referrals
typically begin to accrue to us 3 to 6 months after the portfolio is acquired;
Given the existing volume of loans in various stages of default and
foreclosure, we believe the default services market is likely to grow through 2010;
The acquisition of MPA should position Mortgage Services to grow if the economy
were to improve more quickly than expected;
We generate significant amounts of free cash flow that allow us to invest in
new and existing services at attractive margins; and
Given our small market position in very significant markets, we believe we have
an ability to capture additional market share.
Years Ended December 31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
26,800
$
28,882
$
38,998
$
(2,082
)
(7
)%
$
(10,116
)
(26
)%
17,444
13,173
14,042
4,271
32
(869
)
(6
)
9,194
51
9,143
N/M
51
100
30,464
1,167
29,297
N/M
1,167
100
19,196
11,683
11,220
7,513
64
463
4
$
103,098
$
54,956
$
64,260
$
48,142
88
%
$
(9,304
)
(14
)%
$
25,762
$
27,301
$
26,604
$
(1,539
)
(6
)%
$
697
3
%
13,496
13,173
14,042
323
2
(869
)
(6
)
4,367
4,367
100
30,464
1,161
29,303
N/M
1,161
100
$
74,089
$
41,635
$
40,646
$
32,454
78
%
$
989
2
%
$
1,770
$
$
$
1,770
100
%
$
%
$
14,308
$
$
$
14,308
100
%
$
%
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Variance 2009 vs.
Variance 2008 vs.
Years Ended December 31,
2008
2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
64,434
$
73,835
$
41,293
$
(9,401
)
(13
)%
$
32,542
79
%
52,871
62,590
32,324
(9,719
)
(16
)
30,266
94
11,563
11,245
8,969
318
3
2,276
25
19,267
17,168
14,787
2,099
12
2,381
16
$
(7,704
)
$
(5,923
)
$
(5,818
)
$
(1,781
)
(30
)%
$
(105
)
(2
)%
$
8
$
(94
)
$
(3,252
)
$
102
(109
)
$
3,158
97
%
$
98
$
1,181
$
1,044
$
(1,083
)
(92
)%
$
137
13
%
$
467
$
595
$
1,817
$
(128
)
(22
)%
$
(1,222
)
(67
)%
$
1,029
$
1,833
$
544
$
(804
)
(44
)%
$
1,289
237
%
N/M not meaningful.
(1)
See table at the beginning of this section for a reconciliation of the most directly
comparable GAAP measure to EBITDA.
Table of Contents
Variance 2009 vs.
Variance 2008 vs.
Years Ended December 31,
2008
2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
51,019
$
62,771
$
36,802
$
(11,752
)
(19
)%
$
25,969
71
%
13,415
11,064
4,491
2,351
21
6,573
146
$
64,434
$
73,835
$
41,293
$
(9,401
)
(13
)%
$
32,542
79
%
$
98
$
1,181
$
1,044
$
(1,083
)
(92
)%
$
137
13
%
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Variance 2009 vs.
Variance 2008 vs.
Years Ended December 31,
2008
2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
47,453
$
45,283
$
36,235
$
2,170
5
%
$
9,048
25
%
24,477
29,777
27,354
(5,300
)
(18
)
2,423
9
22,976
15,506
8,881
7,470
48
6,625
75
4,731
6,118
6,359
(1,387
)
(23
)
(241
)
(4
)
$
18,245
$
9,388
$
2,522
$
8,857
94
%
$
6,866
272
%
$
21,150
$
14,169
$
9,473
$
6,981
49
%
$
4,696
50
%
$
20,710
$
35,146
$
24,542
$
(14,436
)
(41
)%
$
10,604
43
%
$
1,517
$
1,980
$
2,540
$
(463
)
(23
)%
$
(560
)
(22
)%
$
231
$
378
$
331
$
(147
)
(39
)%
$
47
14
%
(1)
See table at the beginning of this section for a reconciliation of the most directly
comparable GAAP measure to EBITDA.
(2)
Includes revenue earned from other segments related to RealSuite and IT infrastruture services of $1.8 million and $13.7 million,
respectively in 2008 and $1.5 million and $6.9 million, respectively in 2007.
Table of Contents
Variance 2009 vs.
Variance 2008 vs.
Years Ended December 31,
2008
2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
25,784
$
20,463
$
18,328
$
5,321
26
%
$
2,135
12
%
21,669
24,820
17,907
(3,151
)
(13
)
6,913
39
$
47,453
$
45,283
$
36,235
$
2,170
5
%
$
9,048
25
%
$
9,899
$
9,134
$
7,800
$
765
8
%
$
1,334
17
%
10,811
26,012
16,742
(15,201
)
(58
)
9,270
55
$
20,710
$
35,146
$
24,542
$
(14,436
)
(41
)%
$
10,604
43
%
(1)
Includes revenue earned from other segments related to RealSuite and IT infrastruture services of $1.8 million and $13.7 million,
respectively in 2008 and $1.5 million and $6.9 million, respectively in 2007.
$1.9 million reduction in Compensation costs as we integrated the Financial Services
technology personnel into the existing technology group and eliminated certain positions;
Table of Contents
$2.5 million reduction in Depreciation expense as several assets became fully depreciated
in 2008 and have not been replaced;
$0.9 million reduction in Expenses for Hardware and Software Maintenance as we analyzed
usage of these assets and eliminated unused items; and
$0.6 million net reduction in Telephony as we reduced the number of personnel, renegotiated
contracts with service providers and improved technology to drive down costs.
Table of Contents
December
31,
Variance 2009 vs. 2008
Variance 2008 vs. 2007
(dollars in thousands)
2009
2008
2007
$
%
$
%
$
33,192
$
21,055
$
13,660
$
12,137
58
%
$
7,395
54
%
92
7,850
(5,631
)
(7,758
)
(99
)
13,481
239
33,284
28,905
8,029
4,379
15
20,876
260
(7,536
)
(5,216
)
(56,777
)
(2,320
)
(44
)
51,561
91
(2,280
)
(22,389
)
54,436
20,109
90
(76,825
)
(141
)
23,468
1,300
5,688
22,168
N/M
(4,388
)
(77
)
6,988
5,688
1,300
23
5,688
100
$
30,456
$
6,988
$
5,688
$
23,468
336
%
$
1,300
23
%
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Payments due by period
Less than
More than
(in thousands)
Total
1 year
1-3 years
3-5 years
5 years
$
9,991
$
4,110
$
5,415
$
466
$
664
536
128
26
26
$
10,681
$
4,672
$
5,543
$
466
$
(1)
Represents estimated future interest payments on capital leases, based on applicable interest
rates as of December 31, 2009.
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41
42
43
44
45
46
47
Table of Contents
March 16, 2010
Table of Contents
We were not engaged to audit, review, or apply any procedures with respect to the earnings per
share information presented on the income statement or the related disclosure in Note 12 and
accordingly, we do not express an opinion or any other form of assurance about whether such
information and disclosures are appropriate. The earnings per share information and the
related disclosures were audited by other auditors.
Table of Contents
Balance Sheets
(Dollars in Thousands, Except Per Share Data)
Table of Contents
Statements of Operations
(Dollars in Thousands, Except Share Data)
For the Years Ended December 31,
2008
2007
2009
(Combined
(Combined
(Consolidated)
Consolidated)
Consolidated)
$
202,812
$
160,363
$
134,906
126,797
115,048
96,954
76,015
45,315
37,952
39,473
28,088
27,930
36,542
17,227
10,022
1,034
(2,626
)
(1,743
)
37,576
14,601
8,279
(11,605
)
(5,382
)
(1,564
)
$
25,971
$
9,219
$
6,715
$
1.08
$
0.38
$
0.28
$
1.07
$
0.38
$
0.28
24,061,912
24,050,340
24,050,340
24,260,651
24,050,340
24,050,340
$
94,897
$
64,251
$
59,350
$
4,308
$
6,208
$
8,864
$
1,290
$
2,269
$
965
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Consolidated Statements of Changes in Stockholders and Invested Equity
(Dollars in Thousands)
Additional
Invested
Common Stock
Retained
Paid-in
Equity
Shares
Earnings
Capital
Total
$
8,789
263,412
$
6,059
$
$
$
14,848
6,715
6,715
56,980
56,980
(2,869
)
(2,869
)
69,615
263,412
6,059
75,674
9,219
9,219
(24,347
)
(24,347
)
54,487
263,412
6,059
60,546
Comprehensive
Income
(3,283
)
9,078,495
3,283
$
14,306
14,306
14,306
(1,354
)
(1,354
)
(64,156
)
14,732,428
14,732
49,424
296
296
70,579
71
818
889
11,665
11,665
11,665
$
24,144,914
$
24,145
$
11,665
$
50,538
$
86,348
$
25,971
Table of Contents
Statements of Cash Flows
(Dollars in Thousands)
For the Years Ended December 31,
2008
2007
2009
(Combined
(Combined
(Consolidated)
Consolidated)
Consolidated)
$
25,971
$
9,219
$
6,715
5,432
7,836
6,979
2,672
2,554
1,555
296
(1,179
)
1,197
(1,589
)
249
(21,420
)
7,693
(4,487
)
117
305
587
(616
)
57
207
19,425
(3,370
)
(2,551
)
2,586
3,165
613
33,284
28,905
8,029
(7,536
)
(5,216
)
(4,236
)
(52,541
)
(7,536
)
(5,216
)
(56,777
)
(147
)
(692
)
(2,275
)
(811
)
27,500
(27,500
)
33,417
(1,123
)
(32,294
)
889
(1,354
)
(21,090
)
55,247
(2,280
)
(22,389
)
54,436
23,468
1,300
5,688
6,988
5,688
$
30,456
$
6,988
$
5,688
$
25
$
121
$
750
$
795
$
26
$
$
2,216
$
3,622
$
1,136
$
3,283
$
$
Table of Contents
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Retained
Earnings
Common
(Accumulated
Invested
(in thousands)
Stock
Deficit)
Equity
Total
$
6,059
$
$
54,487
$
60,546
29,480
(8,379
)
21,101
400
(628
)
(228
)
(213
)
(213
)
(29,880
)
9,220
(20,660
)
$
6,059
$
$
54,487
$
60,546
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
5 years
5 years
2 3 years
Shorter of useful life or term of lease
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
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Notes to Consolidated and Combined Consolidated Financial Statements (continued)
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Notes to Consolidated and Combined Consolidated Financial Statements (continued)
2009
72
%
44
47
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
(in thousands)
December 31,
2009
2008
$
11,638
$
8,498
9,073
1,356
10,066
416
31,193
9,854
(696
)
(777
)
$
30,497
$
9,077
(in thousands)
$
765
1,779
(1,134
)
(451
)
959
864
(449
)
(597
)
777
338
(205
)
(214
)
$
696
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
(in thousands)
December 31,
2009
2008
$
1,471
$
1,792
1,433
1,229
$
2,904
$
3,021
(in thousands)
December 31,
2009
2008
$
23,591
$
86,714
9,203
6,072
2,663
1,270
3,441
2,047
38,898
96,103
(27,490
)
(86,799
)
$
11,408
$
9,304
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Technology
Financial
(in thousands)
Products
Services
Total
$
1,618
$
13,179
$
14,797
365
365
(3,622
)
(3,622
)
1,618
9,922
11,540
(2,216
)
(2,216
)
$
1,618
$
7,706
$
9,324
(a)
Purchase price adjustments related to the finalization of the NCI purchase accounting, which
included fair valuing the assets acquired and liabilities assumed, recording of deal related
costs and deferred taxes.
(b)
Prior to our acquisition of NCI in 2007, NCI made an acquisition which created tax-deductible
goodwill that amortizes for tax purposes over time. When we acquired NCI in 2007, we recorded
a lesser amount of goodwill for financial reporting purposes than what had previously been
recorded at NCI for tax purposes. This difference between the amount of goodwill recorded for
financial reporting purposes and the amount recorded for taxes is referred to as Component 2
goodwill and it results in our recording periodic reductions of our book goodwill balance in
our consolidated financial statements. The reduction of book goodwill also resulted in a
reduction of equity of $2.2 million in 2009 and $3.6 million in 2008. We will continue to
amortize the remaining Component 2 goodwill for U.S. tax purposes, which will result in our
reducing book goodwill to zero and then reducing intangible assets by the remaining tax
benefits of the Component 2 goodwill as they are realized in our tax returns. The balance of
Component 2 goodwill remaining was $19.3 million as of December 31, 2009, which should
generate $12.3 million of reductions of goodwill and then intangible assets when the benefit
can be realized for U.S. tax purposes.
Weighted
Average Estimated
Useful Life (Years)
Gross Carrying Amount
Accumulated Amortization
Net Book Value
2009
2008
2009
2008
2009
2008
5
$
2,800
$
2,800
$
1,447
$
887
$
1,353
$
1,913
19
37,700
37,700
5,334
3,222
32,366
34,478
$
40,500
$
40,500
$
6,781
$
4,109
$
33,719
$
36,391
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
(in thousands)
December 31,
2009
2008
$
1,114
$
283
4,853
2,716
8,373
2,518
7,136
1,966
$
24,192
$
4,767
(in thousands)
December 31,
2009
2008
$
2,458
$
2,313
989
1,505
272
2,220
2,395
$
5,939
$
6,213
Facility
Termination
(in thousands)
Lease Costs
Costs
Benefits
Total
$
$
$
$
1,110
747
447
2,304
(747
)
(747
)
(194
)
(447
)
(641
)
916
916
(644
)
(644
)
$
272
$
$
$
272
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
For the Years Ended December 31,
2009
2008
2007
$
4,827
$
4
$
401
8,321
202
1,567
(379
)
(89
)
26
736
133
13,174
563
2,012
(107
)
(1,581
)
(102
)
(664
)
(66
)
1,299
136
185
(1,056
)
(1,569
)
1,197
(1,584
)
3,622
1,136
$
11,605
$
5,382
$
1,564
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
December 31,
(in thousands)
2009
2008
$
1,074
$
349
751
561
(279
)
(642
)
$
1,546
$
268
$
6,644
$
6,908
1,623
1,964
1,680
1,684
692
1,056
103
193
(11,013
)
(11,986
)
(474
)
(1,068
)
(63
)
(1,249
)
(808
)
(1,520
)
(1,862
)
$
(2,769
)
(2,670
)
$
(1,223
)
(2,402
)
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
For the Years Ended December 31,
2009
2008
2007
28.6
%
29.6
%
$
29.6
%
2.6
11.0
(0.8
)
(0.9
)
9.1
1.8
(12.8
)
(11.7
)
0.6
30.9
%
36.9
%
18.9
%
For the Years Ended December 31,
(dollars in thousands, except per share amounts)
2009
2008
2007
$
25,971
$
9,219
$
6,715
24,061,912
24,050,340
24,050,340
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
For the Years Ended December 31,
(dollars in thousands, except per share amounts)
2009
2008
2007
195,673
3,066
24,260,651
24,050,340
24,050,340
$
1.08
$
0.38
$
0.28
$
1.07
$
0.38
$
0.28
a new Altisource stock award to acquire the number of shares of Altisource common stock
equal to the product of (a) the number of Ocwen stock awards held on the Separation date and
(b) the distribution ratio of one share of Altisource common stock for every three shares of
Ocwen common stock; and
an adjusted Ocwen award for the same number of shares of Ocwen common stock with a reduced
exercise price for stock option awards. Each company will record compensation expense for the
stock awards held by its employees even though some of the awards relate to the common stock
of the other company. As a result of the Separation, we did not record any incremental
compensation expense.
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Black-Scholes
Binomial
2.64
%
0.50 3.86
%
39
%
38 46
%
5
10
$
5.35
$4.54 and $5.33
December 31, 2009
$
5.14
$
344,623
$
441,213
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Weighted
Weighted
Average
Aggregate
Average
Contractual
Intrinsic
Number of
Exercise
Term
Value
Options
Price
(in years)
(in thousands)
$
3,115,173
9.76
146,666
14.15
(70,579
)
12.58
(621
)
12.78
3,190,639
$
9.90
7.5
$
35,374
1,148,949
$
9.82
5.4
$
12,831
Options Outstanding
Options Exercisable
Weighted
Weighted
Weighted
Weighted
Average
Average
Average
Average
Exercise
Remaining
Exercise
Remaining
Exercise
Price Range
Number
Contractual Life
Price
Number
Contractual Life
Price
26,109
3.1
$
2.23
26,109
3.1
$
2.23
117,173
2.0
4.31
117,173
2.0
4.31
160,933
2.0
7.66
160,933
2.0
7.66
2,439,736
8.3
9.62
568,972
7.8
9.80
446,688
6.3
14.17
275,762
4.4
14.18
3,190,639
1,148,949
(a)
These options contain market-based components as described above. All other options are
time-based awards.
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Weighted
Average
Grant Date
Restricted Shares
Fair Value
$
3,294
18.00
(58
)
13.00
3,236
$
18.00
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Capital Lease
Operating
Lease
(in thousands)
Obligations
Obligations
$
562
$
4,110
96
3,458
32
1,957
278
188
690
$
9,991
(26
)
664
(536
)
$
128
For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
51,251
$
59,311
$
44,886
59,103
35,825
32,830
16,443
19,912
19,238
$
126,797
$
115,048
$
96,954
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
8,456
$
8,125
$
7,999
4,096
6,208
8,864
10,252
3,270
3,121
16,669
10,485
7,946
$
39,473
$
28,088
$
27,930
For the Years Ended December 31,
(in thousands)
2009
2008
2007
$
16
$
16
$
6
(1,660
)
(2,607
)
(1,932
)
2,678
(35
)
183
$
1,034
$
(2,626
)
$
(1,743
)
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
For the Year Ended December 31, 2009
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
(1)
Altisource
$
103,098
$
64,434
$
47,453
$
(12,173
)
$
202,812
60,735
52,871
24,477
(11,286
)
126,797
42,363
11,563
22,976
(887
)
76,015
5,625
19,267
4,731
9,850
39,473
36,738
(7,704
)
18,245
(10,737
)
36,542
31
1,324
(319
)
(2
)
1,034
$
36,769
$
(6,380
)
$
17,926
$
(10,739
)
$
37,576
$
48
$
2,402
$
2,906
$
76
$
5,432
$
$
2,672
$
$
$
2,672
$
74,089
$
98
$
20,710
$
$
94,897
$
2,712
$
467
$
1,517
$
(388
)
$
4,308
$
30
$
1,029
$
231
$
$
1,290
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
For the Year Ended December 31, 2008
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
(1)
Altisource
$
54,956
$
73,835
$
45,283
$
(13,711
)
$
160,363
36,392
62,590
29,777
(13,711
)
115,048
18,564
11,245
15,506
45,315
5,027
17,168
6,118
(225
)
28,088
13,537
(5,923
)
9,388
225
17,227
(58
)
(1,952
)
(391
)
(225
)
(2,626
)
$
13,479
$
(7,875
)
$
8,997
$
$
14,601
$
34
$
3,202
$
4,600
$
$
7,836
$
$
2,554
$
$
$
2,554
$
41,635
$
1,181
$
35,146
$
(13,711
)
$
64,251
For the Year Ended December 31, 2007
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
(1)
Altisource
$
64,260
$
41,293
$
36,235
$
(6,882
)
$
134,906
44,158
32,324
27,354
(6,882
)
96,954
20,102
8,969
8,881
37,952
7,876
14,787
6,359
(1,092
)
27,930
12,226
(5,818
)
2,522
1,092
10,022
(90
)
(1,269
)
708
(1,092
)
(1,743
)
$
12,136
$
(7,087
)
$
3,230
$
$
8,279
$
292
$
980
$
5,707
$
$
6,979
$
$
1,555
$
$
$
1,555
$
40,646
$
1,044
$
24,542
$
(6,882
)
$
59,350
Table of Contents
Notes to Consolidated and Combined Consolidated Financial Statements (continued)
Corporate Items and
Consolidated
(in thousands)
Mortgage Services
Financial Services
Technology Products
Eliminations
Altisource
$
8,259
$
51,579
$
15,677
$
45,041
$
120,556
$
3,361
$
59,744
$
8,836
$
4,734
$
76,675
2009 Quarter Ended
December 31,
September 30,
June 30,
March 31,
$
56,326
$
54,064
$
49,803
$
42,619
21,334
20,611
19,454
14,616
8,956
12,092
10,009
6,519
5,873
8,644
7,015
4,439
$
0.25
$
0.36
$
0.29
$
0.18
$
0.24
$
0.36
$
0.29
$
0.18
24,082,947
24,050,340
24,050,340
24,050,340
24,338,474
24,050,340
24,050,340
24,050,340
2008 Quarter Ended
December 31,
September 30,
June 30,
March 31,
$
38,940
$
38,007
$
40,868
$
42,548
12,528
9,080
10,835
12,872
5,042
1,311
3,424
4,824
2,343
943
2,463
3,470
$
0.10
$
0.04
$
0.10
$
0.14
24,050,340
24,050,340
24,050,340
24,050,340
Table of Contents
Notes to Consolidated Financial Statements (continued)
Table of Contents
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
ITEM 9A.
CONTROLS AND PROCEDURES
ITEM 9B.
OTHER INFORMATION
Table of Contents
72
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 11.
EXECUTIVE COMPENSATION
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
ITEM 13.
CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
ITEM 14.
PRINCIPAL ACCOUNTING FEES AND SERVICES
Table of Contents
73
74
ITEM 15.
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a)
The following documents are filed as part of this annual report.
1.
Financial Statements
See Item 8 above.
2.
Financial Statement Schedules:
Schedules for which provision is made in the applicable accounting regulations of the SEC
are not required under the related instructions or are not applicable, and therefore have
been omitted.
3.
Exhibits
:
Exhibit
Number
Exhibit Description
Form of Separation Agreement between Altisource Portfolio Solutions S.A. and Ocwen Financial
Corporation (incorporated by reference to Exhibit 2.1 of the Registrants Form 10-12B/A
Amendment No. 1 to Form 10, as filed with the Commission on June 29, 2009)
Articles of Incorporation of Altisource Portfolio Solutions S.A. (incorporated by reference
to Exhibit 2.1 of the Registrants Form 10-12B/A Amendment No. 1 to Form 10, as filed with
the Commission on June 29, 2009)
Separation Agreement, dated as of August 10, 2009, by and between Altisource Portfolio
Solutions S.A. and Ocwen Financial Corporation (incorporated by reference to Exhibit 10.1 of
the Registrants Current Report on Form 8-K, as filed with the Commission on August 13, 2009)
Form of Tax Matters Agreement between Altisource Solutions S.à r.l. and Ocwen Financial
Corporation (incorporated by reference to Exhibit 10.2 of the Registrants Current Report on
Form 8-K, as filed with the Commission on August 13, 2009)
Form of Employee Matters Agreement between Altisource Solutions S.à r.l. and Ocwen Financial
Corporation (incorporated by reference to Exhibit 10.3 of the Registrants Current Report on
Form 8-K, as filed with the Commission on August 13, 2009)
Intellectual Property Agreement, dated as of August 10, 2009, by and between Altisource
Solutions S.à r.l. and Ocwen Financial Corporation (incorporated by reference to Exhibit 10.8
of the Registrants Current Report on Form 8-K, as filed with the Commission on August 13,
2009)
Form of Services Agreement between Altisource Solutions S.à r.l. and Ocwen Financial
Corporation (incorporated by reference to Exhibit 10.5 of the Registrants Current Report on
Form 8-K, as filed with the Commission on August 13, 2009)
Form of Technology Products Services Agreement between Altisource Solutions S.à r.l. and
Ocwen Financial Corporation (incorporated by reference to Exhibit 10.6 of the Registrants
Current Report on Form 8-K, as filed with the Commission on August 13, 2009)
Form of Data Center and Disaster Recovery Services Agreement between Altisource Solutions S.à
r.l. and Ocwen Financial Corporation (incorporated by reference to Exhibit 10.7 of the
Registrants Current Report on Form 8-K, as filed with the Commission on August 13, 2009)
Table of Contents
Exhibit
Number
Exhibit Description
Form of Altisource Portfolio Solutions S.A. 2009 Equity Incentive Plan (incorporated by
reference to Exhibit 10.8 of Amendment No. 1 to the Registration Statement on Form 10, as
filed with the Commission on June 29, 2009)
Employment Agreement by and between Altisource Solutions S.à r.l. and William B. Shepro
(incorporated by reference to Exhibit 10.9 of Amendment No. 1 to the Registration Statement on
Form 10, as filed with the Commission on June 29, 2009)
Employment Agreement by and between Altisource Solutions S.à r.l. and Robert D. Stiles
(incorporated by reference to Exhibit 10.10 of Amendment No. 1 to the Registration Statement
on Form 10, as filed with the Commission on June 29, 2009)
Employment Agreement by and between Altisource Solutions S.à r.l. and Kevin J. Wilcox
(incorporated by reference to Exhibit 10.11 of Amendment No. 1 to the Registration Statement
on Form 10, as filed with the Commission on June 29, 2009)
Purchase and Sale Agreement, dated as of February 12, 2010, by and among Altisource
Portfolio Solutions S.A., and the Equity Interest Holders of The Mortgage Partnership of
America, L.L.C. and the Management Owners
Form of Put Option Agreements
Subsidiaries of the Registrant.
Consent of Independent Registered Public Accounting Firm (Deloitte & Touche LLP).
Consent of Independent Registered Public Accounting Firm (PricewaterhouseCoopers LLP).
Power of Attorney (included on signature page).
Section 302 Certification of the Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a).
Section 302 Certification of the Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a).
Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*
Filed herewith (certain appendices, exhibits and/or similar attachments to this agreement have
been omitted pursuant to Item 601(b)(2) of Regulation S-X. The registrant will furnish
supplementally a copy of any omitted appendix, exhibit or similar attachment to the SEC upon
request)
Table of Contents
75
76
Altisource Portfolio Solutions S.A.
By:
/s/ William B. Shepro
Name:
William B. Shepro
Title:
Chief Executive Officer
(Principal Executive Officer)
/s/ Robert D. Stiles
Name:
Robert D. Stiles
Title:
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting
Officer)
/s/ William B. Shepro
Name:
William B. Shepro
Title:
Chief Executive Officer
(Principal Executive Officer)
/s/ Robert D. Stiles
Name:
Robert D. Stiles
Title:
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting
Officer)
Table of Contents
Signature
Title
Chairman of the Board of Directors
Director
Director
Director
Director and Chief Executive Officer
(Principal Executive Officer)
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
Page | ||||
1. DEFINITIONS
|
1 | |||
|
||||
2. ACQUISITION OF SHARES OF THE COMPANY
|
1 | |||
2.1.Purchase and Sale of Shares.
|
1 | |||
2.2.Purchase Price.
|
2 | |||
2.3.Payment of Purchase Price.
|
2 | |||
2.4.Time and Place of Closing.
|
2 | |||
2.5.Deliveries at the Closing.
|
2 | |||
2.6.Post-Closing Adjustment.
|
3 | |||
2.7.Allocation of Purchase Price.
|
4 | |||
|
||||
3. REPRESENTATIONS AND WARRANTIES OF EACH SELLER AND EACH MANAGEMENT OWNER
|
4 | |||
3.1.Organization and Good Standing.
|
4 | |||
3.2.Authority; No Conflict.
|
4 | |||
3.3.Title to Properties; Capitalization of the Company; Security Interests.
|
5 | |||
3.4.Condition and Sufficiency of Assets; Company Records.
|
6 | |||
3.5.Taxes.
|
7 | |||
3.6.Employee Benefits.
|
9 | |||
3.7.Compliance with Legal Requirements; Governmental Authorizations.
|
12 | |||
3.8.Legal Proceedings; Orders.
|
13 | |||
3.9.Financial Statements.
|
14 | |||
3.10.Absence of Certain Changes and Events.
|
14 | |||
3.11.Contracts; No Defaults.
|
15 | |||
3.12.Insurance.
|
16 | |||
3.13.Facilities.
|
16 | |||
3.14.Employees.
|
17 | |||
3.15.Labor Relations; Compliance.
|
17 | |||
3.16.Intellectual Property.
|
17 | |||
3.17.Relationships with Related Persons.
|
18 | |||
3.18.Brokers or Finders.
|
19 | |||
3.19.Sophistication of Investors; Access to Information.
|
19 | |||
|
||||
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
|
20 | |||
4.1.Organization and Good Standing.
|
20 | |||
4.2.Authority; No Conflict.
|
20 | |||
4.3.Certain Proceedings.
|
20 | |||
4.4.Brokers or Finders.
|
21 | |||
4.5.SEC Reports.
|
21 | |||
4.6.Governmental Consents.
|
21 | |||
4.7.Litigation.
|
21 |
i
5. POST-CLOSING COVENANTS
|
21 | |||
5.1.Litigation Support.
|
21 | |||
5.2.Tax Matters.
|
21 | |||
5.3.Restrictive Covenants.
|
25 | |||
5.4.Audited Financial Statements.
|
27 | |||
5.5.Access to Books and Records.
|
28 | |||
5.6.PIA Payments.
|
28 | |||
5.7.Titleserv Proceeding.
|
30 | |||
|
||||
6. CONDITIONS PRECEDENT TO THE PURCHASERS OBLIGATION TO CLOSE
|
31 | |||
6.1. Accuracy of Representations; Performance of the Sellers and the Management
Owners.
|
31 | |||
6.2. Release of Security Interests.
|
33 | |||
6.3. Additional Documents.
|
33 | |||
|
||||
7. CONDITIONS PRECEDENT TO THE SELLERS AND THE MANAGEMENT OWNERS OBLIGATION TO CLOSE
|
33 | |||
7.1. Accuracy of Representations; the Purchasers Performance.
|
34 | |||
7.2. Additional Documents.
|
34 | |||
|
||||
8. INDEMNIFICATION; REMEDIES
|
35 | |||
8.1. Survival.
|
35 | |||
8.2. Indemnification and Payment of Damages by the Sellers and the Management
Owners.
|
35 | |||
8.3. Indemnification and Payment of Damages by the Purchaser.
|
36 | |||
8.4. Time Limitations.
|
36 | |||
8.5. Limitations on Amount the Sellers and the Management Owners.
|
37 | |||
8.6. Limitations on Amount the Purchaser.
|
37 | |||
8.7. Indemnity Escrow Agreement.
|
37 | |||
8.8. Right of Set-Off.
|
38 | |||
8.9. Procedure for Indemnification Third Party Claims.
|
38 | |||
8.10. Procedure for Indemnification Other Claims.
|
40 | |||
8.11. Exclusive Remedy.
|
40 | |||
8.12. Determination of Damages Amount.
|
40 | |||
|
||||
9. GENERAL PROVISIONS
|
40 | |||
9.1. Expenses.
|
40 | |||
9.2. Public Announcements.
|
40 | |||
9.3. Notices.
|
41 | |||
9.4. Jurisdiction; Service of Process.
|
42 | |||
9.5. Further Assurances.
|
43 | |||
9.6. Waiver.
|
43 | |||
9.7. Entire Agreement and Modification.
|
43 | |||
9.8. Disclosure Schedule.
|
43 | |||
9.9. Obligations; Assignments, Successors, and No Third-Party Rights.
|
44 | |||
9.10. Severability.
|
44 | |||
9.11. Section Headings; Construction.
|
44 |
ii
9.12. Time of Essence.
|
44 | |||
9.13. Governing Law.
|
45 | |||
9.14. Specific Performance.
|
45 | |||
9.15. Counterparts.
|
45 | |||
9.16. Seller Representative.
|
45 | |||
9.17. Acknowledgment by the Purchaser.
|
47 | |||
9.18. Transfer Taxes.
|
47 | |||
9.19. Delivery by Electronic Means.
|
47 |
Annex I
|
Definitions | |
Schedule 2.3
|
Payment of Purchase Price | |
Schedule 2.3(f)
|
Pro-Rata Allocation of Purchase Price Payments | |
Schedule 5.6(h)
|
Payment of PIA Payments | |
Schedule 6.1(h)
|
Preferred Investor Agreement Renewals | |
Exhibit A
|
PIA Payments | |
Exhibit B
|
Purchase Price Allocation | |
Exhibit C
|
Required Approvals | |
Exhibit D-1
|
Form of Indemnity Escrow Agreement | |
Exhibit D-2
|
Form of Put Escrow Agreement | |
Exhibit E-1
|
Form of Rights Agreement | |
Exhibit E-2
|
Form of Put Option Agreement | |
Exhibit F
|
Form of Put Security Agreement | |
Exhibit G
|
Form of Put Pledge Agreement | |
Exhibit H-1
|
Form of Scott M. Stern Employment Agreement | |
Exhibit H-2
|
Form of Timothy C. Stern Employment Agreement | |
Exhibit H-3
|
Form of Barry O. Sandweiss Employment Agreement | |
Exhibit I
|
Form of Release Agreement | |
Exhibit J
|
Form of Collateral Agency Agreement |
iii
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
The Purchaser:
ALTISOURCE PORTFOLIO SOLUTIONS S.A. |
||||
By: | ||||
Name:
|
||||
Title:
|
||||
The Sellers:
SCOTT M. STERN REVOCABLE TRUST |
||||
By: | ||||
Scott M. Stern | ||||
Trustee | ||||
TIMOTHY C. STERN
,
REVOCABLE TRUST
|
||||
By: | ||||
Timothy C. Stern | ||||
Trustee | ||||
BARRY O. SANDWEISS REVOCABLE TRUST
|
||||
By: | ||||
Barry O. Sandweiss | ||||
Trustee | ||||
THE THOMAS A. STERN REVOCABLE TRUST
|
||||
By: | ||||
Thomas A. Stern | ||||
Trustee | ||||
49
EVAN HACKEL | ||||
PARAMOUNT BOND & MORTGAGE CO., INC.
|
||||
By: | ||||
Name: | ||||
Title: | ||||
The Management Owners:
|
||||
SCOTT M. STERN | ||||
TIMOTHY C. STERN | ||||
BARRY O. SANDWEISS | ||||
50
2
3
4
5
6
7
|
, | |||
|
||||
|
||||
|
||||
|
||||
|
||||
|
Attention: | |||
|
Telephone: | |||
|
Telecopier: | |||
|
Email: |
8
9
10
11
ALTISOURCE PORTFOLIO SOLUTIONS S.A.
|
||||
By: | ||||
Name: | ||||
Title: | ||||
THE MANAGEMENT TRUST:
|
||||
REVOCABLE TRUST | ||||
________________, Trustee | ||||
12
Jurisdiction of | ||
Incorporation | ||
Name | or Organization | |
Altisource Solutions S.à.r.l.
|
Luxembourg | |
Altisource Asia Holdings, Ltd.
|
Mauritius | |
Altisource Business Solutions Private Limited
|
India | |
Altisource US Holdings, Inc.
|
Delaware | |
Nationwide Credit, Inc.
|
Georgia | |
Altisource Solutions, Inc.
|
Delaware | |
Altisource US Data, Inc.
|
Delaware | |
Altisource Fulfillment Operations, LLC
|
Florida | |
Premium Title Services, Inc.
|
Florida | |
Real Home Services and Solutions, Inc.
|
Florida | |
Western Progressive Trustee, LLC
|
Delaware | |
Portfolio Management Outsourcing Solutions, LLC
|
Florida | |
Altisource Outsourcing Solutions S.R.L. (99.9% of outstanding stock)
|
Uruguay | |
Altisource Holdings, LLC
|
Delaware | |
Altisource Outsourcing Solutions S.R.L. (0.01% of outstanding stock)
|
Uruguay |
1. | I have reviewed this annual report on Form 10-K for the year ended December 31, 2009 of Altisource Portfolio Solutions S.A.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; | |
4. | The Registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the Registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the Registrants internal control over financial reporting that occurred during the Registrants most recent fiscal quarter (the Registrants fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrants internal control over financial reporting; and |
5. | The Registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrants auditors and the audit committee of the Registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrants internal controls over financial reporting. |
/s/ William B. Shepro | ||||
William B. Shepro | ||||
Chief Executive Officer
(Principal Executive Officer) |
1. | I have reviewed this annual report on Form 10-K for the year ended December 31, 2009 of Altisource Portfolio Solutions S.A.; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; | |
4. | The Registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the Registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the Registrants internal control over financial reporting that occurred during the Registrants most recent fiscal quarter (the Registrants fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrants internal control over financial reporting; and |
5. | The Registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrants auditors and the audit committee of the Registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrants internal controls over financial reporting. |
/s/ Robert D. Stiles | ||||
Robert D. Stiles | ||||
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer) |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ William B. Shepro | ||||
William B. Shepro | ||||
Chief Executive Officer
(Principal Executive Officer) |
||||
* | The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document. |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Robert D. Stiles | ||||
Robert D. Stiles | ||||
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer) |
||||
* | The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Report or as a separate disclosure document. |