|
|
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MARYLAND
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46-0633510
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Large Accelerated Filer
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x
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Accelerated Filer
|
o
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Non-Accelerated Filer
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o
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(Do not check if a smaller reporting company)
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Smaller Reporting Company
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o
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•
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our ability to implement our business strategy;
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•
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our ability to make distributions to our stockholders;
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•
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our ability to acquire assets for our portfolio, including difficulties in identifying single-family rental assets and properties to acquire;
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•
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our ability to sell residential mortgage assets on favorable terms;
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•
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the impact of changes to the supply of, value of and the returns on single-family rental and mortgage assets;
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•
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our ability to acquire single-family rental properties or convert residential mortgage loans to rental properties and generate attractive returns;
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•
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our ability to complete proposed transactions in accordance with anticipated terms and on a timely basis or at all;
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•
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our ability to successfully integrate newly acquired properties into our portfolio of single-family rentals;
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•
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our ability to successfully integrate Main Street Renewal LLC as an additional property manager for our single-family rentals;
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•
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our ability to predict our costs;
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•
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our ability to effectively compete with our competitors;
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•
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our ability to apply the proceeds from financing activities or residential mortgage loan asset sales to target assets in a timely manner;
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•
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changes in the market value of our acquired real estate owned and single-family rental properties;
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•
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our ability to successfully modify or otherwise resolve sub-performing and non-performing loans;
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•
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changes in interest rates and in the market value of the collateral underlying our sub-performing and non-performing loan portfolios;
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•
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our ability to obtain and access financing arrangements on favorable terms or at all;
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•
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our ability to maintain adequate liquidity;
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•
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our ability to retain our engagement of AAMC;
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•
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the failure of ASPS to effectively perform its obligations under various agreements with us;
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•
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the failure of our mortgage loan servicers to effectively perform their servicing obligations;
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•
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our failure to maintain qualification as a REIT;
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•
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our failure to maintain our exemption from registration under the Investment Company Act;
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•
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the impact of adverse real estate, mortgage or housing markets;
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•
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the impact of adverse legislative, regulatory or tax changes; and
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•
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general economic and market conditions.
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September 30, 2016
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December 31, 2015
|
||||
Assets:
|
|
|
|
||||
Real estate held for use:
|
|
|
|
||||
Land
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$
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213,174
|
|
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$
|
56,346
|
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Rental residential properties (net of accumulated depreciation of $17,615 and $7,127, respectively)
|
866,903
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|
|
224,040
|
|
||
Real estate owned
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326,358
|
|
|
455,483
|
|
||
Total real estate held for use, net
|
1,406,435
|
|
|
735,869
|
|
||
Real estate assets held for sale
|
169,841
|
|
|
250,557
|
|
||
Mortgage loans at fair value
|
628,304
|
|
|
960,534
|
|
||
Mortgage loans held for sale
|
4,038
|
|
|
317,336
|
|
||
Cash and cash equivalents
|
56,890
|
|
|
116,702
|
|
||
Restricted cash
|
23,382
|
|
|
20,566
|
|
||
Accounts receivable, net
|
27,839
|
|
|
45,903
|
|
||
Related party receivables
|
—
|
|
|
2,180
|
|
||
Prepaid expenses and other assets
|
14,372
|
|
|
1,126
|
|
||
Total assets
|
$
|
2,331,101
|
|
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$
|
2,450,773
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
||||
Repurchase and loan agreements
|
$
|
1,182,677
|
|
|
$
|
763,369
|
|
Other secured borrowings
|
156,986
|
|
|
502,599
|
|
||
Accounts payable and accrued liabilities
|
52,114
|
|
|
32,448
|
|
||
Related party payables
|
4,926
|
|
|
—
|
|
||
Total liabilities
|
1,396,703
|
|
|
1,298,416
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 7)
|
|
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|
||||
|
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|
||||
Equity:
|
|
|
|
||||
Common stock, $0.01 par value, 200,000,000 authorized shares; 53,869,642 shares issued and outstanding as of September 30, 2016 and 55,581,005 shares issued and outstanding as of December 31, 2015
|
539
|
|
|
556
|
|
||
Additional paid-in capital
|
1,184,174
|
|
|
1,202,418
|
|
||
Accumulated deficit
|
(250,315
|
)
|
|
(50,617
|
)
|
||
Total equity
|
934,398
|
|
|
1,152,357
|
|
||
Total liabilities and equity
|
$
|
2,331,101
|
|
|
$
|
2,450,773
|
|
|
Three months ended September 30, 2016
|
|
Three months ended September 30, 2015
|
|
Nine months ended September 30, 2016
|
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Nine months ended September 30, 2015
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Rental revenues
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$
|
9,590
|
|
|
$
|
4,021
|
|
|
$
|
24,242
|
|
|
$
|
7,561
|
|
Change in unrealized gain on mortgage loans
|
(41,152
|
)
|
|
27,499
|
|
|
(155,306
|
)
|
|
130,842
|
|
||||
Net realized gain on mortgage loans
|
9,428
|
|
|
12,874
|
|
|
30,340
|
|
|
47,528
|
|
||||
Net realized gain on mortgage loans held for sale
|
19
|
|
|
100
|
|
|
50,166
|
|
|
505
|
|
||||
Net realized gain on real estate
|
26,307
|
|
|
13,914
|
|
|
94,833
|
|
|
36,926
|
|
||||
Interest income
|
209
|
|
|
115
|
|
|
425
|
|
|
595
|
|
||||
Total revenues
|
4,401
|
|
|
58,523
|
|
|
44,700
|
|
|
223,957
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
||||||||
Residential property operating expenses
|
15,011
|
|
|
16,574
|
|
|
51,215
|
|
|
45,890
|
|
||||
Real estate depreciation and amortization
|
5,149
|
|
|
2,050
|
|
|
12,790
|
|
|
4,392
|
|
||||
Acquisition fees and costs
|
5,202
|
|
|
861
|
|
|
8,306
|
|
|
1,738
|
|
||||
Selling costs and impairment
|
11,570
|
|
|
10,705
|
|
|
50,003
|
|
|
34,235
|
|
||||
Mortgage loan servicing costs
|
7,792
|
|
|
13,477
|
|
|
27,960
|
|
|
47,989
|
|
||||
Interest expense
|
10,174
|
|
|
14,436
|
|
|
37,060
|
|
|
39,477
|
|
||||
General and administrative
|
2,500
|
|
|
2,286
|
|
|
9,100
|
|
|
8,509
|
|
||||
Management fees
|
4,658
|
|
|
4,988
|
|
|
14,234
|
|
|
25,039
|
|
||||
Total expenses
|
62,056
|
|
|
65,377
|
|
|
210,668
|
|
|
207,269
|
|
||||
Other income (expense)
|
—
|
|
|
1,518
|
|
|
(750
|
)
|
|
3,518
|
|
||||
(Loss) income before income taxes
|
(57,655
|
)
|
|
(5,336
|
)
|
|
(166,718
|
)
|
|
20,206
|
|
||||
Income tax (benefit) expense
|
(17
|
)
|
|
27
|
|
|
106
|
|
|
53
|
|
||||
Net (loss) income
|
$
|
(57,638
|
)
|
|
$
|
(5,363
|
)
|
|
$
|
(166,824
|
)
|
|
$
|
20,153
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
(Loss) earnings per share of common stock - basic:
|
|
|
|
|
|
|
|
|
|
|
|||||
(Loss) earnings per basic share
|
$
|
(1.06
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(3.05
|
)
|
|
$
|
0.35
|
|
Weighted average common stock outstanding - basic
|
54,178,129
|
|
|
57,056,625
|
|
|
54,722,828
|
|
|
57,154,734
|
|
||||
(Loss) earnings per share of common stock - diluted:
|
|
|
|
|
|
|
|
|
|
|
|||||
(Loss) earnings per diluted share
|
$
|
(1.06
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(3.05
|
)
|
|
$
|
0.35
|
|
Weighted average common stock outstanding - diluted
|
54,178,129
|
|
|
57,056,625
|
|
|
54,722,828
|
|
|
57,351,014
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|||||
Dividends declared per common share
|
$
|
0.15
|
|
|
$
|
0.55
|
|
|
$
|
0.60
|
|
|
$
|
1.73
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Total Equity
|
|||||||||||
|
Number of Shares
|
|
Amount
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||
December 31, 2015
|
55,581,005
|
|
|
$
|
556
|
|
|
$
|
1,202,418
|
|
|
$
|
(50,617
|
)
|
|
$
|
1,152,357
|
|
Issuance of common stock, including stock option exercises
|
18,707
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
30
|
|
||||
Repurchases of common stock
|
(1,730,070
|
)
|
|
(17
|
)
|
|
(18,767
|
)
|
|
—
|
|
|
(18,784
|
)
|
||||
Dividends on common stock ($0.60 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(32,874
|
)
|
|
(32,874
|
)
|
||||
Share-based compensation
|
—
|
|
|
—
|
|
|
493
|
|
|
—
|
|
|
493
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(166,824
|
)
|
|
(166,824
|
)
|
||||
September 30, 2016
|
53,869,642
|
|
|
$
|
539
|
|
|
$
|
1,184,174
|
|
|
$
|
(250,315
|
)
|
|
$
|
934,398
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Total Equity
|
|||||||||||
|
Number of Shares
|
|
Amount
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||
December 31, 2014
|
57,192,212
|
|
|
$
|
572
|
|
|
$
|
1,227,091
|
|
|
$
|
99,248
|
|
|
$
|
1,326,911
|
|
Issuance of common stock, including stock option exercises
|
33,034
|
|
|
—
|
|
|
104
|
|
|
—
|
|
|
104
|
|
||||
Repurchases of common stock
|
(1,234,393
|
)
|
|
(12
|
)
|
|
(19,971
|
)
|
|
—
|
|
|
(19,983
|
)
|
||||
Dividends on common stock ($1.73 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(98,302
|
)
|
|
(98,302
|
)
|
||||
Share-based compensation
|
—
|
|
|
—
|
|
|
139
|
|
|
—
|
|
|
139
|
|
||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
20,153
|
|
|
20,153
|
|
||||
September 30, 2015
|
55,990,853
|
|
|
$
|
560
|
|
|
$
|
1,207,363
|
|
|
$
|
21,099
|
|
|
$
|
1,229,022
|
|
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||
Operating activities:
|
|
|
|
||||
Net (loss) income
|
$
|
(166,824
|
)
|
|
$
|
20,153
|
|
Adjustments to reconcile net (loss) income to net cash used in operating activities:
|
|
|
|
||||
Change in unrealized gain on mortgage loans
|
155,306
|
|
|
(130,842
|
)
|
||
Net realized gain on mortgage loans
|
(30,340
|
)
|
|
(47,528
|
)
|
||
Net realized gain on mortgage loans held for sale
|
(50,166
|
)
|
|
(505
|
)
|
||
Net realized gain on real estate
|
(94,833
|
)
|
|
(36,926
|
)
|
||
Real estate depreciation and amortization
|
12,790
|
|
|
4,392
|
|
||
Selling costs and impairment
|
50,003
|
|
|
34,235
|
|
||
Accretion of interest on re-performing mortgage loans
|
(107
|
)
|
|
(581
|
)
|
||
Share-based compensation
|
493
|
|
|
139
|
|
||
Amortization of deferred financing costs
|
8,840
|
|
|
4,271
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
6,612
|
|
|
(1,746
|
)
|
||
Related party receivables
|
2,180
|
|
|
—
|
|
||
Deferred leasing costs
|
(69
|
)
|
|
(1,287
|
)
|
||
Prepaid expenses and other assets
|
(4,729
|
)
|
|
(22
|
)
|
||
Accounts payable and accrued liabilities
|
19,031
|
|
|
15,584
|
|
||
Related party payables
|
4,926
|
|
|
(22,444
|
)
|
||
Net cash used in operating activities
|
(86,887
|
)
|
|
(163,107
|
)
|
||
Investing activities:
|
|
|
|
||||
Investment in real estate
|
(291,688
|
)
|
|
(111,423
|
)
|
||
Investment in renovations
|
(38,334
|
)
|
|
(15,936
|
)
|
||
Real estate tax advances
|
(7,791
|
)
|
|
(18,438
|
)
|
||
Mortgage loan resolutions and dispositions
|
508,712
|
|
|
190,146
|
|
||
Mortgage loan payments
|
16,438
|
|
|
19,268
|
|
||
Disposition of real estate
|
315,973
|
|
|
119,368
|
|
||
Investment in derivative financial instrument
|
(55
|
)
|
|
—
|
|
||
Disposition of preferred stock of affiliate
|
—
|
|
|
18,000
|
|
||
Change in restricted cash
|
(2,816
|
)
|
|
(12,229
|
)
|
||
Net cash provided by investing activities
|
500,439
|
|
|
188,756
|
|
||
Financing activities:
|
|
|
|
||||
Issuance of common stock, including stock option exercises
|
51
|
|
|
204
|
|
||
Payment of tax withholdings on exercise of stock options
|
(21
|
)
|
|
(100
|
)
|
||
Repurchases of common stock
|
(18,784
|
)
|
|
(19,983
|
)
|
||
Dividends on common stock
|
(30,206
|
)
|
|
(67,685
|
)
|
||
Proceeds from the issuance of other secured debt
|
—
|
|
|
221,691
|
|
||
Repayments of other secured debt
|
(348,565
|
)
|
|
(32,298
|
)
|
||
Proceeds from repurchase and loan agreements
|
392,506
|
|
|
285,967
|
|
||
Repayments of repurchase and loan agreements
|
(460,025
|
)
|
|
(386,480
|
)
|
||
Payment of deferred financing costs
|
(8,320
|
)
|
|
(9,250
|
)
|
||
Net cash used in financing activities
|
(473,364
|
)
|
|
(7,934
|
)
|
||
Net (decrease) increase in cash and cash equivalents
|
(59,812
|
)
|
|
17,715
|
|
||
Cash and cash equivalents as of beginning of the period
|
116,702
|
|
|
66,166
|
|
||
Cash and cash equivalents as of end of the period
|
$
|
56,890
|
|
|
$
|
83,881
|
|
|
|
|
|
Altisource Residential Corporation
Consolidated Statements of Cash Flows (continued)
(In thousands)
(Unaudited)
|
|||||||
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
||||
Cash paid for interest
|
$
|
27,983
|
|
|
$
|
34,879
|
|
Income taxes paid
|
180
|
|
|
—
|
|
||
Seller financing of assets acquired
|
489,259
|
|
|
—
|
|
||
Transfer of mortgage loans to real estate owned, net
|
168,395
|
|
|
359,378
|
|
||
Transfer of mortgage loans at fair value to mortgage loans held for sale, net
|
101,201
|
|
|
250,346
|
|
||
Changes in accrued capital expenditures
|
(1,695
|
)
|
|
164
|
|
||
Changes in receivables from mortgage loan resolutions and dispositions, payments and real estate tax advances to borrowers, net
|
(157
|
)
|
|
2,550
|
|
||
Changes in receivables from real estate owned dispositions
|
(11,295
|
)
|
|
1,949
|
|
||
Dividends declared but not paid
|
8,226
|
|
|
30,617
|
|
|
|
December 31, 2015
|
||||||||||
|
|
As Previously Reported
|
|
Adjustments
|
|
Current Presentation
|
||||||
Assets:
|
|
|
|
|
|
|
||||||
Deferred leasing and financing costs (1)
|
|
$
|
7,886
|
|
|
$
|
(7,886
|
)
|
|
$
|
—
|
|
Prepaid expenses and other assets (1)
|
|
415
|
|
|
711
|
|
|
1,126
|
|
|||
Liabilities:
|
|
|
|
|
|
|
||||||
Repurchase and loan agreements
|
|
767,513
|
|
|
(4,144
|
)
|
|
763,369
|
|
|||
Other secured borrowings
|
|
505,630
|
|
|
(3,031
|
)
|
|
502,599
|
|
(1)
|
Upon adoption of ASU 2015-03, we reclassified our deferred leasing costs to prepaid expenses and other assets.
|
Estimated fair value of assets acquired:
|
|
|
|
|
||
Land
|
|
|
|
$
|
123,857
|
|
Rental residential properties
|
|
|
|
499,785
|
|
|
Real estate owned
|
|
|
|
18,895
|
|
|
Prepaid expenses and other assets (1)
|
|
|
|
9,809
|
|
|
Total preliminary allocation of purchase price
|
|
|
|
$
|
652,346
|
|
|
|
|
|
|
||
Source of funds:
|
|
|
|
|
||
Cash on hand
|
|
|
|
$
|
163,087
|
|
Debt financing (Note 6)
|
|
|
|
489,259
|
|
|
Total purchase price
|
|
|
|
$
|
652,346
|
|
(1)
|
Represent estimated lease-in-place intangible asset.
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Unaudited pro forma revenues
|
$
|
18,711
|
|
|
$
|
70,905
|
|
|
$
|
86,021
|
|
|
$
|
257,908
|
|
Unaudited pro forma net loss
|
$
|
(59,717
|
)
|
|
$
|
(10,611
|
)
|
|
$
|
(173,562
|
)
|
|
$
|
(2,317
|
)
|
Loss per basic common share
|
$
|
(1.10
|
)
|
|
$
|
(0.19
|
)
|
|
$
|
(3.17
|
)
|
|
$
|
(0.04
|
)
|
Weighted average common stock outstanding - diluted
|
54,178,129
|
|
|
57,056,625
|
|
|
54,722,828
|
|
|
57,154,734
|
|
||||
Loss per diluted common share
|
$
|
(1.10
|
)
|
|
$
|
(0.19
|
)
|
|
$
|
(3.17
|
)
|
|
$
|
(0.04
|
)
|
Weighted average common stock outstanding - diluted
|
54,178,129
|
|
|
57,056,625
|
|
|
54,722,828
|
|
|
57,154,734
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Revenues from consolidated statement of operations
|
$
|
4,401
|
|
|
$
|
58,523
|
|
|
$
|
44,700
|
|
|
$
|
223,957
|
|
Add: historical revenues of acquired properties not reflected in consolidated statement of operations
|
14,310
|
|
|
12,382
|
|
|
41,321
|
|
|
33,951
|
|
||||
Unaudited pro forma revenues
|
$
|
18,711
|
|
|
$
|
70,905
|
|
|
$
|
86,021
|
|
|
$
|
257,908
|
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income from consolidated statement of operations
|
$
|
(57,638
|
)
|
|
$
|
(5,363
|
)
|
|
$
|
(166,824
|
)
|
|
$
|
20,153
|
|
Plus: historical net income of acquired properties not reflected in consolidated statement of operations
|
8,416
|
|
|
7,597
|
|
|
25,566
|
|
|
20,157
|
|
||||
Less: pro forma depreciation and amortization
|
(5,157
|
)
|
|
(6,558
|
)
|
|
(15,472
|
)
|
|
(25,281
|
)
|
||||
Less: pro forma interest expense
|
(4,737
|
)
|
|
(4,737
|
)
|
|
(14,212
|
)
|
|
(14,212
|
)
|
||||
Less: pro forma management fees
|
(601
|
)
|
|
(1,550
|
)
|
|
(2,620
|
)
|
|
(3,134
|
)
|
||||
Unaudited pro forma net loss
|
$
|
(59,717
|
)
|
|
$
|
(10,611
|
)
|
|
$
|
(173,562
|
)
|
|
$
|
(2,317
|
)
|
|
|
Number of Loans
|
|
Carrying Value
|
|
Unpaid Principal Balance
|
|
Market Value of Underlying Properties
|
|||||||
September 30, 2016
|
|
|
|
|
|
|
|
|
|||||||
Current
|
|
761
|
|
|
$
|
125,038
|
|
|
$
|
161,706
|
|
|
$
|
193,704
|
|
30
|
|
75
|
|
|
11,444
|
|
|
17,213
|
|
|
18,371
|
|
|||
60
|
|
42
|
|
|
5,844
|
|
|
8,362
|
|
|
9,809
|
|
|||
90
|
|
407
|
|
|
54,049
|
|
|
83,064
|
|
|
91,907
|
|
|||
Foreclosure
|
|
2,432
|
|
|
431,929
|
|
|
608,258
|
|
|
620,472
|
|
|||
Mortgage loans at fair value
|
|
3,717
|
|
|
$
|
628,304
|
|
|
$
|
878,603
|
|
|
$
|
934,263
|
|
|
|
|
|
|
|
|
|
|
|||||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|||||||
Current
|
|
730
|
|
|
$
|
124,595
|
|
|
$
|
165,645
|
|
|
$
|
177,348
|
|
30
|
|
80
|
|
|
12,003
|
|
|
18,142
|
|
|
21,858
|
|
|||
60
|
|
38
|
|
|
5,688
|
|
|
8,088
|
|
|
8,766
|
|
|||
90
|
|
984
|
|
|
130,784
|
|
|
216,717
|
|
|
196,963
|
|
|||
Foreclosure
|
|
3,907
|
|
|
687,464
|
|
|
946,962
|
|
|
917,671
|
|
|||
Mortgage loans at fair value
|
|
5,739
|
|
|
$
|
960,534
|
|
|
$
|
1,355,554
|
|
|
$
|
1,322,606
|
|
|
|
Number of Loans
|
|
Carrying Value
|
|
Unpaid Principal Balance
|
|
Market Value of Underlying Properties
|
|||||||
September 30, 2016
|
|
|
|
|
|
|
|
|
|||||||
Current
|
|
13
|
|
|
$
|
1,357
|
|
|
$
|
1,985
|
|
|
$
|
2,600
|
|
30
|
|
7
|
|
|
713
|
|
|
1,508
|
|
|
1,642
|
|
|||
90
|
|
1
|
|
|
485
|
|
|
489
|
|
|
990
|
|
|||
Foreclosure
|
|
10
|
|
|
1,483
|
|
|
1,998
|
|
|
2,212
|
|
|||
Mortgage loans held for sale
|
|
31
|
|
|
$
|
4,038
|
|
|
$
|
5,980
|
|
|
$
|
7,444
|
|
|
|
|
|
|
|
|
|
|
|||||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|||||||
Current
|
|
58
|
|
|
$
|
10,864
|
|
|
$
|
13,466
|
|
|
$
|
17,776
|
|
30
|
|
26
|
|
|
7,616
|
|
|
10,013
|
|
|
12,200
|
|
|||
60
|
|
6
|
|
|
668
|
|
|
775
|
|
|
1,063
|
|
|||
90
|
|
328
|
|
|
73,164
|
|
|
101,121
|
|
|
103,395
|
|
|||
Foreclosure
|
|
879
|
|
|
225,024
|
|
|
314,991
|
|
|
330,573
|
|
|||
Mortgage loans held for sale
|
|
1,297
|
|
|
$
|
317,336
|
|
|
$
|
440,366
|
|
|
$
|
465,007
|
|
Accretable Yield
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||
Balance at the beginning of the period
|
$
|
2,146
|
|
|
$
|
7,640
|
|
Payments and other reductions, net
|
—
|
|
|
(3,285
|
)
|
||
Accretion
|
(107
|
)
|
|
(581
|
)
|
||
Balance at the end of the period
|
$
|
2,039
|
|
|
$
|
3,774
|
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
|
|
Quoted Prices in Active Markets
|
|
Observable Inputs Other Than Level 1 Prices
|
|
Unobservable Inputs
|
||||||
September 30, 2016
|
|
|
|
|
|
|
||||||
Recurring basis (assets)
|
|
|
|
|
|
|
||||||
Mortgage loans at fair value
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
628,304
|
|
Interest rate cap derivative (1)
|
|
—
|
|
|
55
|
|
|
—
|
|
|||
Nonrecurring basis (assets)
|
|
|
|
|
|
|
||||||
Real estate assets held for sale
|
|
—
|
|
|
—
|
|
|
169,841
|
|
|||
Not recognized on consolidated balance sheets at fair value (assets)
|
|
|
|
|
|
|
||||||
Mortgage loans held for sale
|
|
—
|
|
|
—
|
|
|
4,038
|
|
|||
Not recognized on consolidated balance sheets at fair value (liabilities)
|
|
|
|
|
|
|
||||||
Repurchase and loan agreements
|
|
—
|
|
|
1,189,253
|
|
|
—
|
|
|||
Other secured borrowings
|
|
—
|
|
|
157,950
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
||||||
December 31, 2015
|
|
|
|
|
|
|
||||||
Recurring basis (assets)
|
|
|
|
|
|
|
||||||
Mortgage loans at fair value
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
960,534
|
|
Nonrecurring basis (assets)
|
|
|
|
|
|
|
||||||
Real estate assets held for sale
|
|
—
|
|
|
—
|
|
|
250,557
|
|
|||
Not recognized on consolidated balance sheets at fair value (assets)
|
|
|
|
|
|
|
||||||
Mortgage loans held for sale
|
|
—
|
|
|
—
|
|
|
317,336
|
|
|||
Not recognized on consolidated balance sheets at fair value (liabilities)
|
|
|
|
|
|
|
||||||
Repurchase and loan agreements
|
|
—
|
|
|
767,513
|
|
|
—
|
|
|||
Other secured borrowings
|
|
—
|
|
|
502,268
|
|
|
—
|
|
(1)
|
We include the fair value of our interest rate cap derivative within prepaid expenses and other assets in our consolidated balance sheets.
|
|
Three months ended September 30, 2016
|
|
Three months ended September 30, 2015
|
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||||||
Mortgage loans at fair value
|
|
|
|
|
|
|
|
||||||||
Beginning balance
|
$
|
707,445
|
|
|
$
|
1,716,489
|
|
|
$
|
960,534
|
|
|
$
|
1,959,044
|
|
Change in unrealized gain on mortgage loans
|
(8,086
|
)
|
|
43,525
|
|
|
20,542
|
|
|
170,845
|
|
||||
Net realized gain on mortgage loans
|
9,428
|
|
|
12,874
|
|
|
30,340
|
|
|
47,528
|
|
||||
Transfers of mortgage loans at fair value to mortgage loans held for sale, net
|
1,914
|
|
|
(250,346
|
)
|
|
(101,201
|
)
|
|
(250,346
|
)
|
||||
Mortgage loan resolutions and payments
|
(34,967
|
)
|
|
(57,882
|
)
|
|
(119,794
|
)
|
|
(205,120
|
)
|
||||
Real estate tax advances to borrowers
|
1,161
|
|
|
6,611
|
|
|
6,255
|
|
|
18,002
|
|
||||
Transfer of mortgage loans to real estate owned, net
|
(48,591
|
)
|
|
(90,696
|
)
|
|
(168,372
|
)
|
|
(359,378
|
)
|
||||
Ending balance
|
$
|
628,304
|
|
|
$
|
1,380,575
|
|
|
$
|
628,304
|
|
|
$
|
1,380,575
|
|
|
|
|
|
|
|
|
|
||||||||
Change in unrealized gain on mortgage loans at fair value held at the end of the period
|
$
|
(15,027
|
)
|
|
$
|
13,022
|
|
|
$
|
(5,309
|
)
|
|
$
|
93,874
|
|
Input
|
|
September 30, 2016
|
|
December 31, 2015
|
Equity discount rate
|
|
15.0%
|
|
15.0%
|
Debt to asset ratio
|
|
65.0%
|
|
65.0%
|
Cost of funds
|
|
3.5% over 1 month LIBOR
|
|
3.5% over 1 month LIBOR
|
Annual change in home pricing index
|
|
-15.2% to 16.9%
|
|
0.0% to 10.2%
|
Loan resolution probabilities — modification
|
|
0% to 11.4%
|
|
0% to 44.7%
|
Loan resolution probabilities — rental
|
|
0% to 100.0%
|
|
0% to 100.0%
|
Loan resolution probabilities — liquidation
|
|
0% to 100.0%
|
|
0% to 100.0%
|
Loan resolution timelines (in years)
|
|
0.1 - 5.5
|
|
0.1 - 5.6
|
Value of underlying properties
|
|
$3,000 - $4,250,000
|
|
$3,000 - $4,500,000
|
•
|
Credit Suisse (“CS”) is the lender on the repurchase agreement entered into on March 22, 2013, (the “CS repurchase agreement”) with an initial aggregate maximum borrowing capacity of
$100.0 million
. During 2014 and 2015, the CS repurchase agreement was amended on several occasions, ultimately increasing the aggregate maximum borrowing capacity to
$275.0 million
on December 31, 2015 with a maturity date of April 18, 2016. On March 31, 2016, we entered into an amended and restated repurchase agreement with CS that increased our aggregate borrowing capacity to
$350.0 million
, extended the maturity date to March 30, 2017 and removed the REO sublimit under the facility so that 100% of the financed assets can be REO properties.
|
•
|
DB was the lender on the repurchase agreement dated September 12, 2013 (the “DB repurchase agreement”). During March 2016, upon expiration of the DB repurchase agreement in accordance with its terms, we repaid the remaining balance of the DB repurchase agreement and transferred the collateral to our other existing facilities.
|
•
|
Wells Fargo (“Wells”) is the lender under the repurchase agreement dated September 23, 2013 (the “Wells repurchase agreement”) with an initial aggregate maximum borrowing capacity of
$200.0 million
. Throughout 2013, 2014 and 2015, the Wells repurchase agreement was amended on several occasions, ultimately increasing the aggregate maximum borrowing capacity to
$750.0 million
with a maturity date of September 27, 2017.
|
•
|
Nomura Corporate Funding Americas, LLC (“Nomura”) is the lender under a loan agreement dated April 10, 2015 (the “Nomura loan agreement”) with an initial aggregate maximum funding capacity of
$100.0 million
. The Nomura loan agreement was amended during 2015, ultimately increasing the maximum funding capacity to
$200.0 million
on December 31, 2015 with a maturity date of April 8, 2016. On April 7, 2016, we entered into an amended and restated loan and security agreement with Nomura that increased our aggregate borrowing capacity to
$250.0 million
and extended the termination date to April 16, 2017.
|
•
|
In connection with the seller financing related to the HOME SFR Transaction, on September 30, 2016, we entered into a loan agreement (the “Original MSR loan agreement”) between HOME Borrower, the sellers (collectively, the “Lenders”) and MSR Lender LLC, as agent. Pursuant to the Original MSR loan agreement, HOME Borrower borrowed approximately
$489.3 million
from the Lenders (the “MSR Loan”). Effective October 14, 2016, the Original MSR loan agreement was assigned to MSR Lender, LLC (“MSR Lender”) and, in connection with MSR Lender’s securitization of the MSR Loan, we and MSR Lender amended and restated the Original MSR loan agreement (the “A&R MSR loan agreement”) to match the terms of the bonds in MSR Lender's securitization of the MSR Loan. The aggregate amount of the MSR Loan and the aggregate interest rate of the MSR Loan remained unchanged from the Original Loan Agreement. The MSR Loan is a floating rate loan, composed of eight floating rate components, interest on each of which is computed monthly based on one-month LIBOR plus a fixed component spread. The initial maturity date of the MSR Loan is November 9, 2018 (the “Initial Maturity Date”). HOME Borrower has the option to extend the MSR Loan beyond the Initial Maturity Date for three successive one-year terms to an ultimate maturity date of November 9, 2021, provided, among other things, that there is no event of default under the A&R MSR loan
|
|
Maximum Borrowing Capacity
|
|
Book Value of Collateral
|
|
Amount Outstanding
|
|
Amount of Available Funding
|
||||||||
September 30, 2016
|
|
|
|
|
|
|
|
||||||||
CS repurchase agreement due March 30, 2017
|
$
|
350,000
|
|
|
$
|
337,268
|
|
|
$
|
211,382
|
|
|
$
|
138,618
|
|
Wells repurchase agreement due September 27, 2017
|
750,000
|
|
|
621,699
|
|
|
334,726
|
|
|
415,274
|
|
||||
Nomura loan agreement due April 16, 2017
|
250,000
|
|
|
230,765
|
|
|
153,886
|
|
|
96,114
|
|
||||
Original MSR loan agreement due November 15, 2018
|
489,259
|
|
|
642,537
|
|
|
489,259
|
|
|
—
|
|
||||
Less: deferred debt issuance costs
|
—
|
|
|
—
|
|
|
(6,576
|
)
|
|
—
|
|
||||
|
$
|
1,839,259
|
|
|
$
|
1,832,269
|
|
|
$
|
1,182,677
|
|
|
$
|
650,006
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2015
|
|
|
|
|
|
|
|
||||||||
CS repurchase agreement due April 18, 2016
|
$
|
275,000
|
|
|
$
|
335,184
|
|
|
$
|
194,346
|
|
|
$
|
80,654
|
|
Wells repurchase agreement due September 27, 2017
|
750,000
|
|
|
708,275
|
|
|
371,130
|
|
|
378,870
|
|
||||
DB repurchase agreement due March 11, 2016
|
54,944
|
|
|
130,863
|
|
|
54,944
|
|
|
—
|
|
||||
Nomura loan agreement due April 8, 2016
|
200,000
|
|
|
204,578
|
|
|
147,093
|
|
|
52,907
|
|
||||
Less: deferred debt issuance costs
|
—
|
|
|
—
|
|
|
(4,144
|
)
|
|
—
|
|
||||
|
$
|
1,279,944
|
|
|
$
|
1,378,900
|
|
|
$
|
763,369
|
|
|
$
|
512,431
|
|
|
Interest Rate
|
|
Amount Outstanding
|
|||
September 30, 2016
|
|
|
|
|||
ARLP Securitization Trust, Series 2015-1
|
|
|
|
|||
ARLP 2015-1 Class A Notes due May 25, 2055 (1)
|
4.01
|
%
|
|
$
|
191,950
|
|
ARLP 2015-1 Class M Notes due May 25, 2044
|
—
|
%
|
|
60,000
|
|
|
Intercompany eliminations
|
|
|
|
|||
Elimination of ARLP 2015-1 Class A Notes due to ARNS, Inc.
|
|
|
(34,000
|
)
|
||
Elimination of ARLP 2015-1 Class M Notes due to ARLP
|
|
|
(60,000
|
)
|
||
Less: deferred debt issuance costs
|
|
|
(964
|
)
|
||
|
|
|
$
|
156,986
|
|
|
December 31, 2015
|
|
|
|
|||
ARLP Securitization Trust, Series 2014-1
|
|
|
|
|||
ARLP 2014-1 Class A Notes (2)
|
3.47
|
%
|
|
$
|
136,404
|
|
ARLP 2014-1 Class M Notes (2)
|
4.25
|
%
|
|
32,000
|
|
|
ARLP Securitization Trust, Series 2014-2
|
|
|
|
|||
ARLP 2014-2 Class A Notes (2)
|
3.63
|
%
|
|
244,935
|
|
|
ARLP 2014-2 Class M Notes (2)
|
—
|
%
|
|
234,010
|
|
|
ARLP Securitization Trust, Series 2015-1
|
|
|
|
|||
ARLP 2015-1 Class A Notes due May 25, 2055 (1)
|
4.01
|
%
|
|
203,429
|
|
|
ARLP 2015-1 Class M Notes due May 25, 2044
|
—
|
%
|
|
60,000
|
|
|
Intercompany eliminations
|
|
|
|
|||
Elimination of ARLP 2014-1 Class M Notes due to ARNS, Inc.
|
|
|
(32,000
|
)
|
||
Elimination of ARLP 2014-2 Class A Notes due to ARNS, Inc.
|
|
|
(45,138
|
)
|
||
Elimination of ARLP 2014-2 Class M Notes due to ARLP
|
|
|
(234,010
|
)
|
||
Elimination of ARLP 2015-1 Class A Notes due to ARNS, Inc.
|
|
|
(34,000
|
)
|
||
Elimination of ARLP 2015-1 Class M Notes due to ARLP
|
|
|
(60,000
|
)
|
||
Less: deferred debt issuance costs
|
|
|
(3,031
|
)
|
||
|
|
|
$
|
502,599
|
|
(1)
|
The expected redemption date for the Class A Notes ranges from June 25, 2018 to June 25, 2019.
|
(2)
|
Repaid during March 2016.
|
•
|
Base Management Fee
. AAMC is entitled to a quarterly Base Management Fee equal to
1.5%
of the product of (i) our average invested capital (as defined in the New AMA) for the quarter
multiplied by
(ii)
0.25
, while we have fewer than
2,500
single family rental properties actually rented (“Rental Properties”). The Base Management Fee percentage increases to
1.75%
of invested capital while we have between
2,500
and
4,499
Rental Properties and increases to
2.0%
of invested capital while we have
4,500
or more Rental Properties;
|
•
|
Incentive Management Fee
. AAMC is entitled to a quarterly Incentive Management Fee equal to
20%
of the amount by which our return on invested capital (based on AFFO defined as our net income attributable to holders of common stock calculated in accordance with GAAP
plus
real estate depreciation expense
minus
recurring capital expenditures on all of our real estate assets owned) exceeds an annual hurdle return rate of between
7.0%
and
8.25%
(depending on the
10
-year treasury rate). The Incentive Management Fee increases to
22.5%
while we have between
2,500
and
4,499
Rental Properties and increases to
25%
while we have
4,500
or more Rental Properties; and
|
•
|
Conversion Fee
. AAMC is entitled to a quarterly conversion fee equal to
1.5%
of the market value of the single-family homes leased by us for the first time during the quarter.
|
|
Three months ended September 30, 2016
|
|
Three months ended September 30, 2015
|
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||||||
Base management fees (1)
|
$
|
4,208
|
|
|
$
|
4,659
|
|
|
$
|
12,838
|
|
|
$
|
9,411
|
|
Conversion fees (1)
|
450
|
|
|
329
|
|
|
1,396
|
|
|
728
|
|
||||
Management incentive fees (1) (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
14,900
|
|
||||
Expense reimbursements (3)
|
196
|
|
|
—
|
|
|
553
|
|
|
750
|
|
||||
Dividend income (4)
|
—
|
|
|
1,518
|
|
|
—
|
|
|
1,518
|
|
||||
Interest expense (5)
|
—
|
|
|
242
|
|
|
—
|
|
|
563
|
|
||||
Professional fee sharing for negotiation of New AMA
|
—
|
|
|
—
|
|
|
—
|
|
|
2,000
|
|
(1)
|
Included in management fees in the consolidated statements of operations.
|
(2)
|
Pursuant to the terms of the New AMA, the management incentive fees for the first quarter of 2015 were recalculated during the fourth quarter of 2015, and it was determined that
$6.9 million
was reimbursable by AAMC to us.
|
(3)
|
Included in general and administrative expenses in the consolidated statements of operations.
|
(4)
|
On October 17, 2013, we invested
$18.0 million
in the non-voting preferred stock of NewSource Reinsurance Company Ltd. (“NewSource”), an insurance and reinsurance company focused on real estate related insurance products in Bermuda and a wholly owned subsidiary of AAMC. On September 14, 2015, NewSource completed the repurchase of all of our shares of non-voting preferred stock for aggregate proceeds of
$18.0 million
, which was the aggregate par value of the shares being repurchased plus the payment of all accrued and unpaid cumulative dividends on such shares of preferred stock in the amount of
$1.5 million
.
|
(5)
|
Interest expense related to ARLP 2014-1 Class M Notes issued to NewSource. These Class M Notes were repurchased on September 14, 2015.
|
|
Three months ended September 30, 2016
|
|
Three months ended September 30, 2015
|
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net (loss) income
|
$
|
(57,638
|
)
|
|
$
|
(5,363
|
)
|
|
$
|
(166,824
|
)
|
|
$
|
20,153
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator
|
|
|
|
|
|
|
|
||||||||
Weighted average common stock outstanding – basic
|
54,178,129
|
|
|
57,056,625
|
|
|
54,722,828
|
|
|
57,154,734
|
|
||||
Stock options using the treasury method
|
—
|
|
|
—
|
|
|
—
|
|
|
192,870
|
|
||||
Restricted stock
|
—
|
|
|
—
|
|
|
—
|
|
|
3,410
|
|
||||
Weighted average common stock outstanding – diluted
|
54,178,129
|
|
|
57,056,625
|
|
|
54,722,828
|
|
|
57,351,014
|
|
||||
|
|
|
|
|
|
|
|
||||||||
(Loss) earnings per basic common share
|
$
|
(1.06
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(3.05
|
)
|
|
$
|
0.35
|
|
(Loss) earnings per diluted common share
|
$
|
(1.06
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(3.05
|
)
|
|
$
|
0.35
|
|
|
Three months ended September 30, 2016
|
|
Three months ended September 30, 2015
|
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
||||
Denominator (in weighted-average shares)
|
|
|
|
|
|
|
|
||||
Stock options
|
151,755
|
|
|
215,773
|
|
|
154,828
|
|
|
—
|
|
Restricted stock
|
35,671
|
|
|
9,924
|
|
|
15,545
|
|
|
—
|
|
State / District
|
|
Number of Properties
|
|
Carrying
Value (1) (2)
|
|
Weighted Average Age in Years (3)
|
||||
Alabama
|
|
45
|
|
|
$
|
6,481
|
|
|
20.1
|
|
Arizona
|
|
58
|
|
|
15,436
|
|
|
22.5
|
|
|
Arkansas
|
|
31
|
|
|
2,938
|
|
|
32.2
|
|
|
California
|
|
304
|
|
|
105,240
|
|
|
39.3
|
|
|
Colorado
|
|
26
|
|
|
6,049
|
|
|
32.4
|
|
|
Connecticut
|
|
52
|
|
|
9,497
|
|
|
56.7
|
|
|
Delaware
|
|
21
|
|
|
3,900
|
|
|
36.3
|
|
|
Dist. of Columbia
|
|
1
|
|
|
650
|
|
|
111.0
|
|
|
Florida
|
|
1,299
|
|
|
194,865
|
|
|
28.3
|
|
|
Georgia
|
|
2,811
|
|
|
297,512
|
|
|
32.9
|
|
|
Hawaii
|
|
3
|
|
|
622
|
|
|
37.0
|
|
|
Idaho
|
|
8
|
|
|
1,175
|
|
|
33.8
|
|
|
Illinois
|
|
327
|
|
|
57,412
|
|
|
48.0
|
|
|
Indiana
|
|
519
|
|
|
70,203
|
|
|
21.0
|
|
|
Iowa
|
|
7
|
|
|
563
|
|
|
53.8
|
|
|
Kansas
|
|
21
|
|
|
2,776
|
|
|
40.3
|
|
|
Kentucky
|
|
41
|
|
|
5,617
|
|
|
28.6
|
|
|
Louisiana
|
|
12
|
|
|
1,474
|
|
|
35.7
|
|
|
Maine
|
|
4
|
|
|
517
|
|
|
34.3
|
|
|
Maryland
|
|
336
|
|
|
66,895
|
|
|
36.1
|
|
|
Massachusetts
|
|
67
|
|
|
15,343
|
|
|
77.6
|
|
|
Michigan
|
|
53
|
|
|
7,887
|
|
|
41.6
|
|
|
Minnesota
|
|
107
|
|
|
17,621
|
|
|
65.7
|
|
|
Mississippi
|
|
89
|
|
|
13,904
|
|
|
17.0
|
|
|
Missouri
|
|
94
|
|
|
14,084
|
|
|
24.2
|
|
|
Montana
|
|
1
|
|
|
121
|
|
|
25.0
|
|
|
Nebraska
|
|
2
|
|
|
249
|
|
|
73.5
|
|
|
Nevada
|
|
27
|
|
|
4,603
|
|
|
21.8
|
|
|
New Hampshire
|
|
4
|
|
|
566
|
|
|
99.3
|
|
|
New Jersey
|
|
150
|
|
|
23,600
|
|
|
64.1
|
|
|
New Mexico
|
|
51
|
|
|
6,052
|
|
|
27.3
|
|
|
New York
|
|
70
|
|
|
13,153
|
|
|
69.1
|
|
|
North Carolina
|
|
582
|
|
|
73,557
|
|
|
21.0
|
|
|
Ohio
|
|
60
|
|
|
7,750
|
|
|
34.5
|
|
|
Oklahoma
|
|
187
|
|
|
30,736
|
|
|
25.0
|
|
|
Oregon
|
|
28
|
|
|
6,314
|
|
|
38.2
|
|
|
Pennsylvania
|
|
139
|
|
|
18,838
|
|
|
60.0
|
|
|
Rhode Island
|
|
55
|
|
|
7,040
|
|
|
78.5
|
|
|
South Carolina
|
|
103
|
|
|
13,088
|
|
|
23.2
|
|
|
South Dakota
|
|
1
|
|
|
95
|
|
|
36.0
|
|
|
Tennessee
|
|
988
|
|
|
152,464
|
|
|
19.7
|
|
|
Texas
|
|
1,722
|
|
|
253,499
|
|
|
26.0
|
|
|
Utah
|
|
29
|
|
|
4,974
|
|
|
39.2
|
|
Vermont
|
|
5
|
|
|
731
|
|
|
104.8
|
|
|
Virginia
|
|
61
|
|
|
16,756
|
|
|
30.6
|
|
|
Washington
|
|
89
|
|
|
18,736
|
|
|
42.5
|
|
|
West Virginia
|
|
2
|
|
|
288
|
|
|
14.0
|
|
|
Wisconsin
|
|
39
|
|
|
4,405
|
|
|
50.2
|
|
|
Total
|
|
10,731
|
|
|
1,576,276
|
|
|
31.9
|
|
(1)
|
The carrying value of an asset is based on historical cost, which generally consists of the market value at the time of acquisition plus renovation costs, net of any accumulated depreciation and impairment. Assets held for sale are carried at the lower of the carrying amount or estimated fair value less costs to sell.
|
(2)
|
The carrying value of properties acquired in the HOME SFR Transaction are included based upon the preliminary allocation of purchase price. Carrying values for these properties are subject to change during the evaluation period.
|
(3)
|
Weighted average age is based on the age of each property weighted by its proportion of the total carrying value for its respective state.
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||
Leased
|
|
7,079
|
|
|
2,118
|
|
Listed and ready for rent
|
|
587
|
|
|
264
|
|
Renovation or unit turn
|
|
875
|
|
|
350
|
|
Other (1)
|
|
1,351
|
|
|
2,201
|
|
|
|
9,892
|
|
|
4,933
|
|
(1)
|
Consists of properties with a status of evaluating strategy.
|
|
First Quarter 2015
|
|
Second Quarter 2015
|
|
Third Quarter 2015
|
|
Nine months ended September 30, 2015
|
|
First Quarter 2016
|
|
Second Quarter 2016
|
|
Third Quarter 2016
|
|
Nine months ended September 30, 2016
|
||||||||
Real Estate Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Beginning
|
3,960
|
|
|
4,430
|
|
|
4,796
|
|
|
3,960
|
|
|
6,516
|
|
|
6,895
|
|
|
6,588
|
|
|
6,516
|
|
Acquisitions
|
—
|
|
|
—
|
|
|
1,324
|
|
|
1,324
|
|
|
703
|
|
|
291
|
|
|
4,500
|
|
|
5,494
|
|
Dispositions
|
(254
|
)
|
|
(321
|
)
|
|
(357
|
)
|
|
(932
|
)
|
|
(686
|
)
|
|
(910
|
)
|
|
(604
|
)
|
|
(2,200
|
)
|
Mortgage loan conversions to REO, net (1) (2)
|
724
|
|
|
687
|
|
|
507
|
|
|
1,918
|
|
|
360
|
|
|
308
|
|
|
246
|
|
|
914
|
|
Other additions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
4
|
|
|
1
|
|
|
7
|
|
Ending
|
4,430
|
|
|
4,796
|
|
|
6,270
|
|
|
6,270
|
|
|
6,895
|
|
|
6,588
|
|
|
10,731
|
|
|
10,731
|
|
(1)
|
Subsequent to the foreclosure sale, we may be notified that the foreclosure sale was invalidated for certain reasons.
|
(2)
|
During the
nine months ended September 30, 2016
and 2015, conversions to REO included
36
and
2
properties, respectively, that were previously in our mortgage loans held for sale.
|
Location
|
|
Loan Count
|
|
Carrying Value
|
|
UPB
|
|
Market Value of Underlying Properties (1)
|
|||||||
Alabama
|
|
20
|
|
|
$
|
1,714
|
|
|
$
|
2,656
|
|
|
$
|
2,364
|
|
Arizona
|
|
21
|
|
|
2,699
|
|
|
3,457
|
|
|
3,766
|
|
|||
Arkansas
|
|
15
|
|
|
824
|
|
|
1,324
|
|
|
1,237
|
|
|||
California
|
|
268
|
|
|
106,465
|
|
|
122,383
|
|
|
159,030
|
|
|||
Colorado
|
|
15
|
|
|
2,255
|
|
|
2,424
|
|
|
3,543
|
|
|||
Connecticut
|
|
55
|
|
|
11,971
|
|
|
16,922
|
|
|
17,036
|
|
|||
Delaware
|
|
26
|
|
|
2,723
|
|
|
4,228
|
|
|
4,090
|
|
|||
Dist. of Columbia
|
|
33
|
|
|
4,478
|
|
|
6,143
|
|
|
7,228
|
|
|||
Florida
|
|
714
|
|
|
103,312
|
|
|
155,578
|
|
|
155,105
|
|
|||
Georgia
|
|
107
|
|
|
11,681
|
|
|
15,569
|
|
|
16,392
|
|
|||
Hawaii
|
|
20
|
|
|
7,261
|
|
|
9,522
|
|
|
10,585
|
|
|||
Idaho
|
|
3
|
|
|
356
|
|
|
391
|
|
|
445
|
|
|||
Illinois
|
|
123
|
|
|
16,458
|
|
|
25,318
|
|
|
23,789
|
|
|||
Indiana
|
|
106
|
|
|
9,434
|
|
|
13,363
|
|
|
13,261
|
|
|||
Iowa
|
|
4
|
|
|
157
|
|
|
180
|
|
|
306
|
|
|||
Kansas
|
|
4
|
|
|
173
|
|
|
270
|
|
|
461
|
|
|||
Kentucky
|
|
25
|
|
|
1,855
|
|
|
3,117
|
|
|
2,771
|
|
|||
Louisiana
|
|
15
|
|
|
1,634
|
|
|
2,137
|
|
|
2,446
|
|
|||
Maine
|
|
13
|
|
|
1,124
|
|
|
2,182
|
|
|
1,873
|
|
|||
Maryland
|
|
213
|
|
|
32,706
|
|
|
49,990
|
|
|
48,362
|
|
|||
Massachusetts
|
|
127
|
|
|
22,994
|
|
|
31,543
|
|
|
35,255
|
|
|||
Michigan
|
|
17
|
|
|
1,788
|
|
|
2,202
|
|
|
2,861
|
|
|||
Minnesota
|
|
16
|
|
|
3,246
|
|
|
3,799
|
|
|
4,560
|
|
|||
Mississippi
|
|
11
|
|
|
1,050
|
|
|
1,513
|
|
|
1,472
|
|
|||
Missouri
|
|
30
|
|
|
1,835
|
|
|
2,637
|
|
|
2,773
|
|
|||
Montana
|
|
1
|
|
|
177
|
|
|
252
|
|
|
250
|
|
|||
Nebraska
|
|
2
|
|
|
142
|
|
|
219
|
|
|
198
|
|
|||
Nevada
|
|
78
|
|
|
14,285
|
|
|
24,619
|
|
|
20,706
|
|
|||
New Hampshire
|
|
4
|
|
|
899
|
|
|
1,139
|
|
|
1,248
|
|
|||
New Jersey
|
|
424
|
|
|
61,596
|
|
|
112,294
|
|
|
93,401
|
|
|||
New Mexico
|
|
61
|
|
|
5,908
|
|
|
7,888
|
|
|
8,370
|
|
|||
New York
|
|
420
|
|
|
94,925
|
|
|
128,249
|
|
|
143,135
|
|
|||
North Carolina
|
|
52
|
|
|
5,471
|
|
|
7,059
|
|
|
7,907
|
|
|||
North Dakota
|
|
1
|
|
|
97
|
|
|
123
|
|
|
143
|
|
|||
Ohio
|
|
36
|
|
|
2,870
|
|
|
4,441
|
|
|
4,673
|
|
|||
Oklahoma
|
|
13
|
|
|
1,712
|
|
|
2,375
|
|
|
2,428
|
|
|||
Oregon
|
|
34
|
|
|
7,861
|
|
|
10,115
|
|
|
11,350
|
|
|||
Pennsylvania
|
|
98
|
|
|
10,212
|
|
|
15,746
|
|
|
15,458
|
|
|||
Puerto Rico
|
|
1
|
|
|
96
|
|
|
189
|
|
|
175
|
|
|||
Rhode Island
|
|
19
|
|
|
2,263
|
|
|
3,874
|
|
|
3,337
|
|
|||
South Carolina
|
|
72
|
|
|
7,449
|
|
|
10,088
|
|
|
10,472
|
|
|||
Tennessee
|
|
30
|
|
|
4,319
|
|
|
4,984
|
|
|
6,247
|
|
|||
Texas
|
|
177
|
|
|
20,537
|
|
|
21,483
|
|
|
31,882
|
|
|||
Utah
|
|
12
|
|
|
2,853
|
|
|
3,152
|
|
|
3,887
|
|
|||
Vermont
|
|
2
|
|
|
243
|
|
|
290
|
|
|
367
|
|
|||
Virginia
|
|
21
|
|
|
4,701
|
|
|
5,956
|
|
|
6,347
|
|
Washington
|
|
132
|
|
|
27,470
|
|
|
31,894
|
|
|
38,154
|
|
|||
West Virginia
|
|
1
|
|
|
46
|
|
|
126
|
|
|
85
|
|
|||
Wisconsin
|
|
25
|
|
|
1,979
|
|
|
3,200
|
|
|
3,032
|
|
|||
Total mortgage loans at fair value
|
|
3,717
|
|
|
$
|
628,304
|
|
|
$
|
878,603
|
|
|
$
|
934,263
|
|
(1)
|
Market value is based on the most recent broker price opinion (“BPO”) for each property.
|
|
First Quarter 2015
|
|
Second Quarter 2015
|
|
Third Quarter 2015
|
|
Nine months ended September 30, 2015
|
|
First Quarter 2016
|
|
Second Quarter 2016
|
|
Third Quarter 2016
|
|
Nine months ended September 30, 2016
|
||||||||
Mortgage Loans at Fair Value
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Beginning
|
10,963
|
|
|
10,089
|
|
|
9,134
|
|
|
10,963
|
|
|
5,739
|
|
|
5,397
|
|
|
4,072
|
|
|
5,739
|
|
Resolutions
|
(150
|
)
|
|
(270
|
)
|
|
(145
|
)
|
|
(565
|
)
|
|
(169
|
)
|
|
(122
|
)
|
|
(109
|
)
|
|
(400
|
)
|
Transferred to held for sale
|
—
|
|
|
—
|
|
|
(871
|
)
|
|
(871
|
)
|
|
—
|
|
|
(895
|
)
|
|
—
|
|
|
(895
|
)
|
Reversion from held for sale
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|
187
|
|
|
—
|
|
|
—
|
|
|
187
|
|
Mortgage loan conversions to REO, net (2)
|
(724
|
)
|
|
(687
|
)
|
|
(507
|
)
|
|
(1,918
|
)
|
|
(360
|
)
|
|
(308
|
)
|
|
(246
|
)
|
|
(914
|
)
|
Ending
|
10,089
|
|
|
9,134
|
|
|
7,611
|
|
|
7,611
|
|
|
5,397
|
|
|
4,072
|
|
|
3,717
|
|
|
3,717
|
|
(1)
|
Excludes mortgage loans held for sale.
|
(2)
|
Subsequent to the foreclosure sale, we may be notified that the foreclosure sale was invalidated for certain reasons.
|
i.
|
Rental revenues.
Minimum contractual rents from leases are recognized on a straight-line basis over the terms of the leases in residential rental revenues. Therefore, actual amounts billed in accordance with the lease during any given period may be higher or lower than the amount of rental revenue recognized for the period. As we acquire more single-family rental properties in bulk and on a one-by-one basis and as we renovate and deem suitable for rent a greater number of our REO properties, we expect a greater portion of our revenues will be rental revenues. We believe the key variables that will affect our rental revenues over the long term will be average occupancy levels and rental rates.
|
ii.
|
Net realized gain (loss) on mortgage loans.
We record net realized gains or losses, including the reclassification of previously accumulated net unrealized gains, upon the liquidation of a loan, which may consist of short sale, third party sale of the underlying property, refinancing or full debt pay-off of the loan. We expect the timeline to liquidate loans will vary significantly by loan, which could result in fluctuations in revenue recognition and operating performance from period to period. Additionally, the proceeds from loan liquidations may vary significantly depending on the resolution methodology. We generally expect to collect proceeds of loan liquidations in cash and, thereafter, have no continuing involvement with the asset.
|
iii.
|
Change in unrealized gains from the conversion of loans to REO.
Upon conversion of loans to REO, we mark the properties to the most recent market value. The difference between the carrying value of the asset at the time of conversion and the most recent market value, based on BPOs, is recorded in our statement of operations as change in unrealized gain on mortgage loans. We expect the timeline to convert acquired loans into REO will vary significantly by loan, which could result in fluctuations in our revenue recognition and our operating performance from period to period. The factors that may affect the timelines to foreclose upon a residential mortgage loan include, without limitation, state foreclosure timelines and deferrals associated therewith; unauthorized parties occupying the property; inadequacy of documents necessary to foreclose; bankruptcy proceedings initiated by borrowers; federal, state or local legislative action or initiatives designed to provide homeowners with assistance in avoiding residential mortgage loan foreclosures; continued declines in real estate values and/or sustained high levels of unemployment that increase the number of foreclosures and which place additional pressure and/or delays on the judicial and administrative proceedings.
|
iv.
|
Change in unrealized gains from the change in fair value of loans.
After our NPLs are acquired, the fair value of each loan is adjusted in each subsequent reporting period as the loan proceeds to a particular resolution (i.e., modification, liquidation or conversion to real estate owned). As a loan approaches resolution, the resolution timeline for that loan decreases, and costs embedded in the discounted cash flow model for loan servicing, foreclosure costs and property insurance are incurred and removed from future expenses. The shorter resolution timelines and reduced future expenses each increase the fair value of the loan. The increase in the value of the loan is recognized in change in unrealized gain on mortgage loans in our consolidated statements of operations. The exact nature of resolution will be dependent on a number of factors that are beyond our control, including borrower willingness to pay, property value, availability of refinancing, interest rates, conditions in the financial markets, the regulatory environment and other factors.
|
v.
|
Net realized gain on real estate.
REO properties that do not meet our investment criteria are sold out of our taxable REIT subsidiary. The realized gain or loss recognized in the financial statements reflects the net amount of realized and unrealized gains on sold REOs from the time of acquisition to sale completion.
|
•
|
First, we recognized an aggregate of
$10.7 million
and
$34.8 million
in unrealized gains upon conversion of mortgage loans to REO for the
three and nine months ended September 30, 2016
, respectively, compared to $17.0 million and $68.4 million for the
three and nine months ended September 30, 2015
, respectively. Upon conversion of these mortgage loans to REO, we mark the properties to the most recent market value. During the
three and nine months ended September 30, 2016
, we converted a net of
246
and
914
mortgage loans to REO status compared to a net of 507 and 1,918 mortgage loans converted to REO status during the
three and nine months ended September 30, 2015
, respectively;
|
•
|
Second, we recognized an aggregate change in unrealized gains of
$(12.9) million
and
$9.8 million
from the net change in the fair value of loans for the
three and nine months ended September 30, 2016
compared to an increase in fair value of
$33.9 million
and
$126.6 million
during the
three and nine months ended September 30, 2015
, respectively. The fair value of our mortgage loans is based on the underlying value of the collateral, current market conditions, different resolution scenarios and other factors. The assumptions utilized to determine fair value include, but are not limited to, equity discount rate, debt to asset ratio, cost of funds estimates, projected resolution timelines and costs and changes in annual home pricing index. During the
three and nine months ended September 30, 2016
, the fair value of our mortgage loans was impacted primarily changes in our assumptions applied in the estimation of fair value; and
|
•
|
Third, we reclassified an aggregate of
$39.0 million
and
$199.9 million
from unrealized gains on mortgage loans to realized gains on real estate and mortgage loans, reflecting real estate sold and the resolution or sale of NPLs for the
three and nine months ended September 30, 2016
, respectively. This compares to an aggregate of
$23.4 million
and
$64.2 million
reclassified from unrealized gains on mortgage loans to realized gains for the
three and nine months ended September 30, 2015
, respectively.
|
•
|
Credit Suisse (“CS”) is the lender on the repurchase agreement entered into on March 22, 2013, (the “CS repurchase agreement”) with an initial aggregate maximum borrowing capacity of
$100.0 million
. During 2014 and 2015, the CS repurchase agreement was amended on several occasions, ultimately increasing the aggregate maximum borrowing capacity to
$275.0 million
on December 31, 2015 with a maturity date of April 18, 2016. On March 31, 2016, we entered into an amended and restated repurchase agreement with CS that increased our aggregate borrowing capacity to
$350.0 million
, extended the maturity date to March 30, 2017 and removed the REO sublimit under the facility so that 100% of the financed assets can be REO properties.
|
•
|
DB was the lender on the repurchase agreement dated September 12, 2013 (the “DB repurchase agreement”). During March 2016, upon the expiration of the DB repurchase agreement in accordance with its terms, we repaid the remaining balance of the DB repurchase agreement and transferred the collateral to our other existing facilities.
|
•
|
Wells Fargo (“Wells”) is the lender under the repurchase agreement dated September 23, 2013 (the “Wells repurchase agreement”) with an initial aggregate maximum borrowing capacity of
$200.0 million
. Throughout 2013, 2014 and 2015, the Wells repurchase agreement was amended on several occasions, ultimately increasing the aggregate maximum borrowing capacity to
$750.0 million
with a maturity date of September 27, 2017.
|
•
|
Nomura Corporate Funding Americas, LLC (“Nomura”) is the lender under a loan agreement dated April 10, 2015 (the “Nomura loan agreement”) with an initial aggregate maximum funding capacity of
$100.0 million
. The Nomura loan agreement was amended during 2015, ultimately increasing the maximum funding capacity to
$200.0 million
on December 31, 2015 with a maturity date of April 8, 2016. On April 7, 2016, we entered into an amended and restated loan and security agreement with Nomura that increased our aggregate borrowing capacity to
$250.0 million
and extended the termination date to April 16, 2017.
|
•
|
In connection with the seller financing related to the HOME SFR Transaction, on September 30, 2016, we entered into a loan agreement (the “Original MSR loan agreement”) between HOME Borrower, the sellers (collectively, the “Lenders”) and MSR Lender LLC, as agent. Pursuant to the Original MSR loan agreement, HOME Borrower borrowed approximately $489.3 million from the Lenders (the “MSR Loan”). Effective October 14, 2016, the Original MSR loan agreement was assigned to MSR Lender, LLC (“MSR Lender”) and, in connection with MSR Lender’s securitization of the MSR Loan, we and MSR Lender amended and restated the Original MSR loan agreement (the “A&R MSR loan agreement”) to revise the initial principal amount and fixed-rate spread over one-month LIBOR for each component of the MSR Loan set forth in the Original MSR loan agreement. The aggregate amount of the MSR Loan and the aggregate interest rate of the MSR Loan under the A&R MSR loan agreement remain unchanged from the Original MSR loan agreement. The MSR Loan is a floating rate loan, composed of eight floating rate components, interest on each of which is computed monthly based on one-month LIBOR plus a fixed component spread. The initial maturity date of the MSR Loan is November 9, 2018 (the “Initial Maturity Date”). HOME Borrower has the option to extend the MSR Loan beyond the Initial Maturity Date for three successive one-year terms to an ultimate maturity date of November 9, 2021, provided, among other things, that there is no event of default under the A&R MSR loan
|
|
Three months ended September 30, 2016
|
|
Three months ended December 31, 2015
|
|
Three months ended September 30, 2015
|
||||||
Balance at end of period
|
$
|
1,189,253
|
|
|
$
|
767,513
|
|
|
$
|
929,478
|
|
Maximum month end balance outstanding during the period
|
1,189,253
|
|
|
953,586
|
|
|
929,478
|
|
|||
Weighted average quarterly balance
|
737,049
|
|
|
882,874
|
|
|
864,995
|
|
|||
Amount of available funding at end of period
|
650,006
|
|
|
512,431
|
|
|
386,699
|
|
|
Interest Rate
|
|
Amount Outstanding
|
|||
September 30, 2016
|
|
|
|
|||
ARLP Securitization Trust, Series 2015-1
|
|
|
|
|||
ARLP 2015-1 Class A Notes due May 25, 2055 (1)
|
4.01
|
%
|
|
$
|
191,950
|
|
ARLP 2015-1 Class M Notes due May 25, 2044
|
—
|
%
|
|
60,000
|
|
|
Intercompany eliminations
|
|
|
|
|||
Elimination of ARLP 2015-1 Class A Notes due to ARNS, Inc.
|
|
|
(34,000
|
)
|
||
Elimination of ARLP 2015-1 Class M Notes due to ARLP
|
|
|
(60,000
|
)
|
||
Less: deferred debt issuance costs
|
|
|
(964
|
)
|
||
|
|
|
$
|
156,986
|
|
|
December 31, 2015
|
|
|
|
|||
ARLP Securitization Trust, Series 2014-1
|
|
|
|
|||
ARLP 2014-1 Class A Notes (2)
|
3.47
|
%
|
|
$
|
136,404
|
|
ARLP 2014-1 Class M Notes (2)
|
4.25
|
%
|
|
32,000
|
|
|
ARLP Securitization Trust, Series 2014-2
|
|
|
|
|||
ARLP 2014-2 Class A Notes (2)
|
3.63
|
%
|
|
244,935
|
|
|
ARLP 2014-2 Class M Notes (2)
|
—
|
%
|
|
234,010
|
|
|
ARLP Securitization Trust, Series 2015-1
|
|
|
|
|||
ARLP 2015-1 Class A Notes due May 25, 2055 (1)
|
4.01
|
%
|
|
203,429
|
|
|
ARLP 2015-1 Class M Notes due May 25, 2044
|
—
|
%
|
|
60,000
|
|
|
Intercompany eliminations
|
|
|
|
|||
Elimination of ARLP 2014-1 Class M Notes due to ARNS, Inc.
|
|
|
(32,000
|
)
|
||
Elimination of ARLP 2014-2 Class A Notes due to ARNS, Inc.
|
|
|
(45,138
|
)
|
||
Elimination of ARLP 2014-2 Class M Notes due to ARLP
|
|
|
(234,010
|
)
|
||
Elimination of ARLP 2015-1 Class A Notes due to ARNS, Inc.
|
|
|
(34,000
|
)
|
||
Elimination of ARLP 2015-1 Class M Notes due to ARLP
|
|
|
(60,000
|
)
|
||
Less: deferred debt issuance costs
|
|
|
(3,031
|
)
|
||
|
|
|
$
|
502,599
|
|
(1)
|
The expected redemption date for the Class A Notes ranges from June 25, 2018 to June 25, 2019.
|
(2)
|
Repaid during March 2016.
|
|
Nine months ended September 30, 2016
|
|
Nine months ended September 30, 2015
|
|
Change
|
||||||
Net cash used in operating activities
|
$
|
(86,887
|
)
|
|
$
|
(163,107
|
)
|
|
$
|
76,220
|
|
Net cash provided by investing activities
|
500,439
|
|
|
188,756
|
|
|
311,683
|
|
|||
Net cash used in financing activities
|
(473,364
|
)
|
|
(7,934
|
)
|
|
(465,430
|
)
|
|||
Total cash flows
|
$
|
(59,812
|
)
|
|
$
|
17,715
|
|
|
$
|
(77,527
|
)
|
|
(a) Total Number of Shares Purchased
|
|
(b) Average Price Paid per Share
|
|
(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
(d) Maximum Dollar Value of Shares that may yet be Purchased Under Plans or Programs (1)
|
||||||
July
|
—
|
|
|
$
|
—
|
|
|
2,779,603
|
|
|
$
|
62,495
|
|
August
|
595,542
|
|
|
10.51
|
|
|
3,375,145
|
|
|
56,233
|
|
||
September
|
—
|
|
|
—
|
|
|
3,375,145
|
|
|
56,233
|
|
||
Quarter ended September 30, 2016
|
595,542
|
|
|
10.51
|
|
|
3,375,145
|
|
|
56,233
|
|
(1)
|
Since Board approval of repurchases is based on dollar amount, we cannot estimate the number of shares remaining to be purchased.
|
Exhibit Number
|
|
Description
|
2.1
|
|
Separation Agreement, dated as of December 21, 2012, between Altisource Residential Corporation and Altisource Portfolio Solutions S.A. (incorporated by reference to Exhibit 2.1 of the Registrant's Current Report on Form 8-K filed with the Commission on December 28, 2012).
|
2.2
|
|
Membership Interest Purchase and Sale Agreement, dated September 30, 2016, between MSR I, LP and Altisource Residential, L.P. (incorporated by reference to Exhibit 2.1 of the registrant's Current Report on Form 8-K filed on October 3, 2016).
|
2.3
|
|
Purchase and Sale Agreement, dated September 30, 2016, between Firebird SFE I, LLC and Altisource Residential, L.P. (incorporated by reference to Exhibit 2.2 of the registrant's Current Report on Form 8-K filed on October 3, 2016).
|
3.1
|
|
Articles of Restatement of Altisource Residential Corporation (incorporated by reference to Exhibit 3.3 of the registrant's Current Report on Form 8-K filed on April 8, 2013).
|
3.2
|
|
By-laws of Altisource Residential Corporation (incorporated by reference to Exhibit 3.2 of the Registrant's Registration Statement on Form 10 filed with the Commission on December 5, 2012).
|
10.1
|
|
Property Management Services Agreement, dated September 30, 2016, by and between HOME SFR Borrower, LLC and Main Street Renewal LLC (incorporated by reference to Exhibit 10.1 of the registrant's Current Report on Form 8-K filed on October 3, 2016).
|
10.2
|
|
Side Letter, dated September 30, 2016, by and between HOME SFR Borrower, LLC and Main Street Renewal LLC (incorporated by reference to Exhibit 10.2 of the registrant's Current Report on Form 8-K filed on October 3, 2016).
|
10.3
|
|
Amendment and Waiver Agreement, dated September 30, 2016, by and among Altisource Residential Corporation and Altisource Solutions S.à r.l. (incorporated by reference to Exhibit 10.3 of the registrant's Current Report on Form 8-K filed on October 3, 2016).
|
10.4
|
|
Loan Agreement, dated September 30, 2016, among Home SFR Borrower, LLC, as Borrower, MSR I, L.P., as a Lender, MSR II, L.P., as a Lender, and MSR Lender LLC, as Agent (incorporated by reference to Exhibit 10.4 of the registrant's Current Report on Form 8-K filed on October 3, 2016).
|
10.5
|
|
Amended and Restated Loan Agreement, dated October 7, 2016, between Home SFR Borrower, LLC, as Borrower, and MSR Lender LLC, as Lender (incorporated by reference to Exhibit 10.1 of the registrant's Current Report on Form 8-K filed on October 14, 2016).
|
10.6*
|
|
Form of Stock Option Award Agreement under the 2016 Equity Incentive Plan.
|
10.7*
|
|
Form of Restricted Stock Unit Award Agreement under the 2016 Equity Incentive Plan.
|
31.1*
|
|
Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act
|
31.2*
|
|
Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act
|
32.1*
|
|
Certification of CEO Pursuant to Section 906 of the Sarbanes-Oxley Act
|
32.2*
|
|
Certification of CFO Pursuant to Section 906 of the Sarbanes-Oxley Act
|
101.INS*
|
|
XBRL Instance Document
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
|
XBRL Extension Labels Linkbase
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
Altisource Residential Corporation
|
Date:
|
November 7, 2016
|
By:
|
/s/
|
Robin N. Lowe
|
|
|
|
|
Robin N. Lowe
|
|
|
|
|
Chief Financial Officer
|
1.
|
Grant of Stock Options
. The Corporation hereby grants to the Participant, effective as of the Date of Grant, the right and option to purchase, on the terms and conditions set forth in the Plan and this Agreement, all or any part of an aggregate of [●] Shares, subject to adjustment as set forth in the Plan (the “
Options
”). The Options are intended to be nonqualified stock options.
|
2.
|
Exercise Price
. The exercise price of each Option is [●] per Share, subject to adjustment as set forth in the Plan (the “
Exercise Price
”).
|
3.
|
Vesting of Options
.
|
(a)
|
General
.
|
(i)
|
Subject to the Participant’s continued Service through each applicable vesting date:
|
1.
|
one-third of the Options shall vest upon the later of (A) the first anniversary of the Date of Grant and (B) the date the Performance Goal (as defined in Section 3(a)(ii)) is attained;
|
2.
|
one-third of the Options shall vest upon the later of (A) the second anniversary of the Date of Grant and (B) the date the Performance Goal is attained; and
|
3.
|
one-third of the Options shall vest upon the later of (A) the third anniversary of the Date of Grant and (B) the date the Performance Goal is attained;
|
(ii)
|
For purposes of this Agreement, the “
Performance Goal
” shall be attained on the date, which date must occur, if ever, no later than the fourth anniversary of the Date of Grant, that the sum of (a) the average price per Share for the consecutive 20-trading-day period ending on such date plus (b) the amount of all reinvested dividends, calculated on a per-share basis, from the Date of Grant through such date shall equal or exceed 125% of the price per Share on the Date of Grant (i.e., 125% of the Exercise Price). If the Performance Goal is not attained on or prior to the fourth anniversary of the Date of Grant, then, except as set forth in Section 3(b), no portion of the Options shall vest.
|
(b)
|
Termination of Service
.
|
(i)
|
All unvested Options shall fully vest upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason, in either case, on or within two years following a Change of Control.
|
(ii)
|
Upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason other than as set forth in clause (i) above and at a time when the Performance Goal has previously been attained, a portion of the unvested Options shall immediately vest based on the product of (x) the total number of unvested Options and (y) a fraction, the numerator of which is the number of full calendar months elapsed from the Date of Grant or, if later, the most recent anniversary thereof, through the date of termination, and the denominator of which is the number of full calendar months from the Date of Grant, or, if later, the most recent anniversary thereof through the third anniversary of the Date of Grant (i.e., 36, 24 or 12). Any portion of the unvested Options that does not vest in accordance with the immediately preceding sentence shall be forfeited immediately, automatically and without consideration on the date of termination of Service.
|
(iii)
|
Upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason other than as set forth in clause (i) above and at a time when the Performance Goal has not yet been attained, a portion of the unvested Options shall initially remain outstanding and eligible to vest based on the product of (x) the total number of unvested Options and (y) a fraction, the numerator of which is the number of full calendar months elapsed from the Date of Grant through the date of termination (such number not to exceed 36), and the denominator of which is 36. Such portion of the unvested Options shall remain outstanding until the earlier of (I) the date the Performance Goal is attained, in which case such portion shall vest, and (II) the fourth anniversary of the Date of Grant, in which case such portion shall be forfeited immediately, automatically and without consideration. Any portion of the unvested Options that does not remain outstanding in accordance with the immediately preceding sentence shall be forfeited immediately, automatically and without consideration on the date of termination of Service.
|
(iv)
|
All unvested Options shall fully vest upon a termination of the Participant’s Service due to death or Disability.
|
(v)
|
All vested and unvested Options will be forfeited immediately, automatically and without consideration upon a termination of Service for Cause.
|
(vi)
|
Except as otherwise set forth in clauses (i) through (v) above, any unvested Options will be forfeited immediately, automatically and without consideration upon a termination of Service for any reason.
|
(vii)
|
For purposes of this Agreement:
|
1.
|
“
Cause
” means gross or willful neglect of duty that is not corrected after 30 days’ written notice thereof; misconduct, malfeasance, fraud or dishonesty that materially and adversely affects the Corporation or its reputation in the industry; or the commission of a felony or a crime involving moral turpitude. All determinations as to Cause shall be made by the Committee in its sole discretion.
|
2.
|
“
Disability
” means a medically determinable physical or mental impairment that is expected to result in death or that has lasted or can be expected to last for either (x) a continuous period of at least 90 days or (y) an aggregate of 90 days in any 180-day period.
|
3.
|
“
Good Reason
” means, without the consent of the Participant, (i) a material diminution in the Participant’s title, position, duties or responsibilities with respect to the Corporation, or (ii) the notification of the Participant by the Corporation that the Corporation shall require the Participant to relocate his or her primary place of Service with the Corporation
to a site that is more than 50 miles from both the Participant’s current primary place of Service and the Participant’s primary residence; provided, however, that no act or omission described in clause (i) or (ii) shall be treated as “Good Reason” under this Agreement unless (a) the Participant delivers to the Corporation a written statement of the basis for Participant’s belief that Good Reason exists within 120 days following the date such basis first arises, (b) the Corporation fails to cure the grounds constituting Good Reason within 30 days following Participant’s delivery of such written statement, and (c) Participant actually resigns within 90 days of such failure to cure.
|
4.
|
Expiration
. Any unvested Options will expire on the fourth anniversary of the Date of Grant, and any vested but unexercised Options will expire on the seventh anniversary of the Date of Grant, or earlier as provided in this Agreement or the Plan (the “
Expiration Date
”).
|
5.
|
Period of Exercise
. Subject to the provisions of the Plan and this Agreement, the Participant may exercise all or any part of the vested Options at any time prior to the earliest to occur of:
|
(a)
|
the Expiration Date;
|
(b)
|
the date that is 12 months following termination of the Participant’s Service due to death or Disability;
|
(c)
|
the date that is 90 days following termination of the Participant’s Service other than for death, Disability or Cause; or
|
(d)
|
the date of termination of the Participant’s Service for Cause.
|
6.
|
Exercise of Options
.
|
(a)
|
Notice of Exercise
. Subject to Sections 3, 4 and 5, the Participant or, in the case of the Participant’s death or Disability, the Participant’s representative may exercise all or any part of the vested Options (covering whole Shares) through an approved online securities account (or as otherwise specified by the Committee) in accordance with the procedures therein (a “
Notice of Exercise
”). The Notice of Exercise will be electronically executed by the person exercising the Options. In the event that the Options are being exercised by the Participant’s representative, the Notice of Exercise will be accompanied by proof (satisfactory to the Committee) of the representative’s right to exercise the Options. The Participant or the Participant’s representative will deliver to the Committee, at the time of giving the Notice of Exercise, payment in a form permissible under Section 7 for the full amount of the Purchase Price (as defined below) and applicable withholding taxes as provided below.
|
(b)
|
Issuance of Shares
. After all requirements with respect to the exercise of the Options have been satisfied, the Committee will cause the Shares as to which the Options have been exercised to be issued (or, in the Committee’s discretion, in un-certificated form, upon the books of the Corporation’s transfer agent), registered in the name of the person exercising the Options (or in the names of such person and his or her spouse as community property or as joint tenants with right of survivorship). Neither the Corporation nor the Committee will be liable to the Participant or any other Person for damages relating to any delays in issuing the Shares or any mistakes or errors in the issuance of the Shares.
|
(c)
|
Withholding Requirements
. The Corporation in its sole discretion shall have the power and the right to deduct or withhold automatically from any Shares deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Corporation, the minimum statutory amount necessary to satisfy federal, state and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement, or in the sole discretion of the Committee, such greater amount necessary to satisfy the Participant’s expected tax liability, provided that, the withholding of such greater amount does not result in adverse tax or accounting consequences to the Corporation (the “
Withheld Taxes
”).
|
7.
|
Payment for Shares
. The “
Purchase Price
” will be the Exercise Price multiplied by the number of Shares with respect to which Options are being exercised. All or part of the Purchase Price and any Withheld Taxes may be paid as follows:
|
(a)
|
Cash or Check
. In cash or by bank certified check.
|
(b)
|
Brokered Cashless Exercise
. To the extent permitted by applicable law and the Committee, from the proceeds of a sale through a broker on the date of exercise of some or all of the Shares to which the exercise relates. In that case, the Participant will electronically execute a Notice of Exercise and provide the Corporation’s third-party Plan administrator with a copy of irrevocable instructions to a broker to deliver promptly to the Corporation the amount of sale proceeds to pay the aggregate purchase price and/or Withheld Taxes, as applicable. To
|
(c)
|
Net Exercise
. By reducing the number of Shares otherwise deliverable upon the exercise of the Options by the number of Shares having a Fair Market Value equal to the amount of the Purchase Price and/or Withheld Taxes, as applicable.
|
(d)
|
Surrender of Stock
. In each instance, at the sole discretion of the Committee, by surrendering, or attesting to the ownership of, Shares that are already owned by the Participant free and clear of any restriction or limitation, unless the Committee specifically agrees in writing to accept such Shares subject to such restriction or limitation. Such Shares will be surrendered to the Corporation in good form for transfer and will be valued by the Corporation at their Fair Market Value on the date of the applicable exercise of the Options, or to the extent applicable, on the date the Withheld Taxes are to be determined. The Participant will not surrender, or attest to the ownership of, Shares in payment of the Purchase Price (or Withheld Taxes) if such action would cause the Corporation to recognize compensation expense (or additional compensation expense) with respect to the Options for financial reporting purposes that otherwise would not have been recognized (collectively, “
Withheld Taxes
”).
|
8.
|
Adjustment to Options
. In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 8 of the Plan, the Options may be adjusted in accordance with Section 8 of the Plan.
|
9.
|
Miscellaneous Provisions
.
|
(a)
|
Securities Laws Requirements
. No Shares will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the Shares may be listed, have been fully met. As a condition precedent to the issuance of Shares pursuant to this Agreement, the Corporation may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any Shares issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which shares of the same class are then listed and under any blue-sky or other securities laws applicable to those Shares.
|
(b)
|
No Rights as Shareholder
. Neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Corporation with respect to any Shares subject to the Options until the Participant or the Participant’s representative becomes entitled to receive those Shares by (i) electronically executing a Notice of Exercise, (ii) paying the Purchase Price and Withheld Taxes as provided in this Agreement, and the Corporation actually receiving those amounts, (iii) the Corporation issuing those Shares and entering the name of the Participant in the register of shareholders of the Corporation as the registered holder of those Shares and (iv) satisfying any other conditions as the Committee reasonably requires.
|
(c)
|
Transfer Restrictions
. The Shares purchased by exercise of the Options will be subject to such stop-transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Corporation or the Committee to which
|
(d)
|
No Right to Continued Service
. Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation or any Affiliate or of the Participant, which rights are hereby expressly reserved, to terminate the Participant’s Service at any time and for any reason, with or without Cause.
|
(e)
|
Notification
. Any notification required by the terms of this Agreement will be given by the Participant (i) in a writing addressed to the Corporation at its principal executive office, or (ii) by electronic transmission to the Corporation’s e-mail address of the Corporation’s General Counsel. Any notification required by the terms of this Agreement will be given by the Corporation (x) in a writing addressed to the address that the Participant most recently provided to the Corporation, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable).
|
(f)
|
Entire Agreement
. This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.
|
(g)
|
Waiver
. No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.
|
(h)
|
Successors and Assigns
. The provisions of this Agreement will inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries, and legatee(s), as applicable, whether or not any such person will have become a party to this Agreement and have agreed in writing to be joined herein and be bound by the terms hereof.
|
(i)
|
Severability
. The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then the remaining provisions will nevertheless be binding and enforceable.
|
(j)
|
Amendment
. Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Corporation.
|
(k)
|
Choice of Law; Jurisdiction
. This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Maryland, excluding any conflicts- or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.
|
(l)
|
Signature in Counterparts
. This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.
|
(m)
|
Acceptance
. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions of the Plan and this Agreement, and accepts the Options subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.
|
PARTICIPANT
|
|
ALTISOURCE RESIDENTIAL CORPORATION
|
|||
|
|
|
|
|
|
Signed:
|
|
|
By:
|
|
|
|
|
|
|
|
|
Printed:
|
|
|
Name:
|
|
|
|
|
|
|
|
|
|
|
|
Title:
|
|
|
1.
|
Grant of Restricted Stock Unit Award
. The Corporation hereby grants to the Participant [●] Restricted Stock Units, on the terms and conditions set forth in the Plan and this Agreement, subject to adjustment as set forth in the Plan.
|
2.
|
Vesting; Forfeiture
. Subject to the terms and conditions set forth in the Plan and this Agreement, the Restricted Stock Units shall vest as follows:
|
(a)
|
General
. Except as otherwise provided in Section 2(b), the Restricted Stock Units shall vest in equal annual installments on each of the first three anniversaries of the Date of Grant, subject to the Participant’s continued Service through each applicable vesting date.
|
(b)
|
Termination of Service
.
|
(i)
|
All unvested Restricted Stock Units shall fully vest upon a termination of Service by the Corporation without Cause or by the Participant for Good Reason on or within two years following a Change of Control.
|
(ii)
|
Upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason other than as set forth in clause (i) above, a portion of the unvested Restricted Stock Units shall immediately vest based on the product of (x) the total number of unvested Restricted Stock Units and (y) a fraction, the numerator of which is the number of full calendar months elapsed from the Date of Grant, or if later, the most recent anniversary thereof, through the date of termination of Service, and the denominator of which is the number of full calendar months from
|
(iii)
|
All unvested Restricted Stock Units shall fully vest upon a termination of the Participant’s Service due to death or Disability.
|
(iv)
|
All vested and unvested Restricted Stock Units will be forfeited immediately, automatically and without consideration upon a termination of Service for Cause.
|
(v)
|
Except as otherwise set forth in clause (i) through (iv) above, any unvested Restricted Stock units will be forfeited immediately, automatically and without consideration upon a termination of Service for any reason.
|
(vi)
|
For purposes of this Agreement:
|
1.
|
“
Cause
” means gross or willful neglect of duty that is not corrected after 30 days’ written notice thereof; misconduct, malfeasance, fraud or dishonesty that materially and adversely affects the Corporation or its reputation in the industry; or the commission of a felony or a crime involving moral turpitude. All determinations as to Cause shall be made by the Committee in its sole discretion.
|
2.
|
“
Disability
” means a medically determinable physical or mental impairment that is expected to result in death or that has lasted or can be expected to last for either (x) a continuous period of at least 90 days or (y) an aggregate of 90 days in any 180-day period.
|
3.
|
“
Good Reason
” means, without the consent of the Participant, (i) a material diminution in the Participant’s title, position, duties or responsibilities with respect to the Corporation, or (ii) the notification of the Participant by the Corporation that the Corporation shall require the Participant to relocate his or her primary place of Service with the Corporation
to a site that is more than 50 miles from both the Participant’s current primary place of Service and the Participant’s primary residence; provided, however, that no act or omission described in clause (i) or (ii) shall be treated as “Good Reason” under this Agreement unless (a) the Participant delivers to the Corporation a written statement of the basis for Participant’s belief that Good Reason exists within 120 days following the date such basis first arises, (b) the Corporation fails to cure the grounds constituting Good Reason within 30 days following Participant’s delivery of such written statement, and (c) Participant actually resigns within 90 days of such failure to cure.
|
3.
|
Payment
.
|
(a)
|
Settlement
. The Corporation shall deliver to the Participant within 45 days following the vesting date of the Restricted Stock Units a number of Shares equal to the aggregate number of Restricted Stock Units that vest as of such date. No fractional Shares shall be delivered;
|
(b)
|
Withholding Requirements
. The Corporation in its sole discretion shall have the power and the right to deduct or withhold automatically from any Shares deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Corporation, the minimum statutory amount necessary to satisfy federal, state and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement, or in the sole discretion of the Committee, such greater amount necessary to satisfy the Participant’s expected tax liability, provided that, the withholding of such greater amount does not result in adverse tax or accounting consequences to the Corporation.
|
4.
|
Dividend Equivalent Rights
.
|
(a)
|
This Award is granted together with Dividend Equivalent Rights. Prior to the date of settlement of this Award, whenever a dividend is paid with respect to Shares, a corresponding Dividend Equivalent Right shall be credited with respect to each outstanding Restricted Share Unit then held by the Participant in an amount equal to the amount paid as a dividend in respect of one Share.
|
(b)
|
If thus credited prior to the vesting date, such Dividend Equivalent Right shall be subject to the same vesting, forfeiture, settlement and other terms and conditions as the underlying Restricted Share Unit with respect to which it was credited; provided, that settlement shall be in cash rather than in Shares.
|
(c)
|
If credited on or following the vesting date but prior to the date of settlement, such Dividend Equivalent Right shall be fully vested and not subject to forfeiture and shall be paid to the Participant in cash within 30 days following the date the dividend to which it relates is paid.
|
5.
|
Adjustment of Shares
. In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 8 of the Plan, the Restricted Stock Units may be adjusted in accordance with Section 8 of the Plan.
|
6.
|
Miscellaneous Provisions
.
|
(a)
|
Securities Laws Requirements
. No Shares will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the Shares may be listed, have been fully met. As a condition precedent to the issuance of Shares pursuant to this Agreement, the Corporation may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any Shares issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which shares of the same class are then listed and under any blue-sky or other securities laws applicable to those Shares.
|
(b)
|
No Rights as Shareholder
. Prior to settlement of the Restricted Stock Units in Shares, neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Corporation with respect to any Shares underlying the Restricted Stock Units.
|
(c)
|
Transfer Restrictions
. The Shares delivered hereunder will be subject to such stop-transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Corporation or the Committee to which the Participant is a party or subject, and the Committee may cause orders or designations to be placed upon the books and records of the Corporation’s transfer agent to make appropriate reference to such restrictions.
|
(d)
|
No Right to Continued Service
. Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation or any Affiliate or of the Participant, which rights are hereby expressly reserved, to terminate the Participant’s Service at any time and for any reason, with or without Cause.
|
(e)
|
Notification
. Any notification required by the terms of this Agreement will be given by the Participant (i) in a writing addressed to the Corporation at its principal executive office, or (ii) by electronic transmission to the Corporation’s e-mail address of the Corporation’s General Counsel. Any notification required by the terms of this Agreement will be given by the Corporation (x) in a writing addressed to the address that the Participant most recently provided to the Corporation, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable).
|
(f)
|
Entire Agreement
. This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.
|
(g)
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Waiver
. No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.
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(h)
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Successors and Assigns
. The provisions of this Agreement will inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries and legatee(s), as applicable, whether or not any such person will have become a party to this Agreement and have agreed in writing to be joined herein and be bound by the terms hereof.
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(i)
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Severability
. The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then the remaining provisions will nevertheless be binding and enforceable.
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(j)
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Amendment
. Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Corporation.
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(k)
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Choice of Law; Jurisdiction
. This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Maryland, excluding any conflicts or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.
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(l)
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Signature in Counterparts
. This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.
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(m)
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Acceptance
. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions of the Plan and this Agreement, and accepts the Restricted Stock Units subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.
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PARTICIPANT
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ALTISOURCE RESIDENTIAL CORPORATION
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Signed:
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By:
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Printed:
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Name:
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Title:
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Date:
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November 7, 2016
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By:
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/s/
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George G. Ellison
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George G. Ellison
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Chief Executive Officer
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Date:
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November 7, 2016
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By:
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/s/
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Robin N. Lowe
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Robin N. Lowe
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Chief Financial Officer
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Date:
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November 7, 2016
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By:
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/s/
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George G. Ellison
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George G. Ellison
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Chief Executive Officer
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Date:
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November 7, 2016
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By:
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/s/
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Robin N. Lowe
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Robin N. Lowe
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Chief Financial Officer
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