Exhibit 10.1

 

 

 

INVESTMENT AGREEMENT

by and between

Front Yard Residential Corporation

and

Amherst Single Family Residential Partners VI, LP

Dated as of May 4, 2020

 

 

 

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INVESTMENT AGREEMENT

INVESTMENT AGREEMENT, dated as of May 4, 2020 (this “Agreement”), by and between
Front Yard Residential Corporation, a Maryland corporation (the “Company”), and
Amherst Single Family Residential Partners VI, LP, a Delaware limited
partnership (together with its successors and any Permitted Transferee, the
“Purchaser”).

WHEREAS, the Company, BAF Holdings, LLC (“Parent”) and BAF Sub, LLC (“Merger
Sub”) previously entered into an Agreement and Plan of Merger, dated as of
February 17, 2020 (the “Merger Agreement”), pursuant to which the Company was to
be merged with and into Merger Sub on the terms and subject to the conditions
set forth in the Merger Agreement (the “Merger”);

WHEREAS, concurrently with the execution of this Agreement, (i) the parties to
the Merger Agreement (and Purchaser) are entering into a Termination and
Settlement Agreement and (ii) the Company and an affiliate of the Purchaser are
entering into a Non-Negotiable Promissory Note (the “Promissory Note”); and

WHEREAS, in accordance with the terms set forth herein, the Company desires to
issue, sell and deliver to the Purchaser, and the Purchaser desires to purchase
and acquire from the Company, an aggregate of 4,400,000 shares of the Company’s
common stock, par value $0.01 per share (the “Shares”).

NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements contained in this Agreement, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree as follows:

ARTICLE I

Definitions

Section 1.01 Definitions. (a) As used in this Agreement (including the recitals
hereto), the following terms shall have the following meanings:

“Acquired Shares” has the meaning given to it in Section 2.01.

“Affiliate” means, when used with respect to any Person, any other Person who
controls, or is controlled by, or is under common control with, such Person. For
this purpose, “control” means the possession, directly or indirectly, of the
power to direct or cause the direction of management or policies of a Person,
whether through the ownership of securities or partnership or other ownership
interests, by contract or otherwise.

“Agreement” has the meaning given to it in the preamble.

“Asset Sale Transaction” has the meaning given to it in Section 5.07.

“Bankruptcy and Equity Exception” has the meaning given to it in Section 3.03.

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“beneficially own,” “beneficial ownership of” or “beneficially owning” any
securities shall have the meaning set forth in Rule 13d-3 of the rules and
regulations under the Exchange Act.

“Board” means the Board of Directors of the Company.

“Business Day” means any day of the year on which banks are not required or
authorized by Law to close in New York City.

“Chancery Court” has the meaning given to it in Section 7.04.

“Change of Control Date” has the meaning given to it in Section 5.06(d).

“Chosen Courts” has the meaning given to it in Section 7.04.

“Closing” has the meaning given to it in Section 2.02.

“Closing Date” has the meaning given to it in Section 2.02.

“Company” has the meaning given to it in the preamble.

“Company Charter Documents” means the Company’s charter (as amended, restated or
supplemented as of the date hereof) or the Amended and Restated Bylaws of the
Company, effective as of February 21, 2018.

“Company Stock Plans” means the Front Yard Residential Corporation Conversion
Option Plan, the Front Yard Residential Corporation Special Conversion Option
Plan, Front Yard Residential Corporation 2016 Equity Incentive Plan or the Front
Yard Residential Corporation 2019 Equity Incentive Plan.

“Excess Shares” means a number of Acquired Shares that could have been
Transferred by Purchaser in the prior quarters (determined on a cumulative
basis) but were not Transferred by Purchaser.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“Financing Transaction” has the meaning given to it in Section 5.07.

“GAAP” means generally accepted accounting principles in the United States,
consistently applied.

“Governmental Authority” means any government, court, regulatory or
administrative agency, commission, arbitrator (public or private) or authority
or other legislative, executive or judicial governmental entity (in each case
including any self-regulatory organization), whether federal, state or local,
domestic, foreign or multinational.

“Judgment” means any order, judgment, injunction, ruling, writ, award or decree
of any Governmental Authority.

 

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“Law” means any federal, state, local, foreign or transnational law, statute or
ordinance, common law, or any rule or regulation.

“Liens” means liens, encumbrances, mortgages, charges, claims, restrictions,
pledges, security interests, title defects, easements, rights-of-way, covenants,
encroachments or other adverse claims of any kind with respect to a property or
asset.

“Material Adverse Effect” means, with respect to the Company and its
Subsidiaries, any change, effect, event, occurrence, development, circumstance,
condition or effect that, individually or in the aggregate (x) has or would
reasonably be expected to prevent or materially impair or delay the ability of
the Company and its Subsidiaries, to consummate the transactions contemplated
hereby or (y) has had or would reasonably be expected to have a material adverse
effect on the financial condition, properties, assets, business or results of
operations of the Company and its Subsidiaries, taken as a whole, excluding for
the purposes of clause (y), any such effect resulting from or arising in
connection with: (1) changes in, or events generally affecting, the financial,
securities or capital markets, (2) general economic or political conditions in
the United States or any foreign jurisdiction in which the Company or any of its
Subsidiaries operate, including any changes in currency exchange rates, interest
rates, monetary policy or inflation, (3) changes in, or events generally
affecting, the industries in which the Company or any of its Subsidiaries
operate, (4) any acts of war, pandemic (including COVID-19), sabotage, civil
disobedience or terrorism or natural disasters (including hurricanes, tornadoes,
floods or earthquakes), (5) any failure by the Company or any of its
Subsidiaries to meet any internal or published budgets, projections, forecasts
or predictions in respect of financial performance for any period, (6) a decline
in the price of the Shares, or a change in the trading volume of the Shares, on
the NYSE, including as a result of the termination of the Merger Agreement,
provided, that the exceptions in clauses (5) and (6) shall not prevent or
otherwise affect a determination that any change, effect, circumstance or
development underlying such failure or decline or change (if not otherwise
falling within any of the exclusions pursuant to the other clauses of this
definition) has resulted in, or contributed to, a Company Material Adverse
Effect, (7) changes in applicable Law, (8) changes in GAAP (or authoritative
interpretation thereof), (9) the taking of any specific action expressly
required by this Agreement or taken with Purchaser’s written consent, (10) the
announcement or pendency (but, for the avoidance of doubt, not the consummation)
of this Agreement, including the impact thereof on the relationships with
customers, suppliers, distributors, partners, other third parties with whom the
Company has a relationship or (11) any litigation brought by stockholders of the
Company or the Purchaser alleging breach of duty or inadequate disclosure in
connection with this Agreement or any of the transactions contemplated hereby
(it being understood and agreed that the exception in this clause (11) shall
apply to the effects arising out of or relating to the bringing of such
litigation and not those arising out of or resulting from an actual breach (or
other claim) that is the subject thereof); provided, that the changes, effects,
circumstances or developments set forth in the foregoing clauses (1), (2), (3),
(4), (7) and (8) shall be taken into account in determining whether a “Material
Adverse Effect” has occurred to the extent such changes, effects, circumstances
or developments have a disproportionate adverse effect on the Company and its
Subsidiaries, taken as a whole, relative to other participants in the industries
in which the Company and its Subsidiaries operate (but only the incremental
disproportionate effect on the Company and its Subsidiaries, taken as a whole).

 

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“Measurement Date” has the meaning set forth in Section 3.02.

“Merger” has the meaning given to it in the recitals.

“Merger Agreement” has the meaning given to it in the recitals.

“Merger Sub” has the meaning given to it in the recitals.

“MGCL” means the Maryland General Corporation Law, as amended, supplemented or
restated from time to time.

“Parent” has the meaning given to it in the recitals.

“Permitted Transferee” means, with respect to any Person, any Affiliate of such
Person.

“Person” means an individual, corporation, limited liability company,
partnership, joint venture, association, trust, unincorporated organization or
any other entity, including a Governmental Authority.

“Preferred Shares” has the meaning given to it in Section 3.02.

“Promissory Note” has the meaning given to it in the recitals.

“Purchase” has the meaning given to it in Section 2.01.

“Purchase Price” has the meaning given to it in Section 2.01.

“Purchaser” has the meaning given to it in the preamble.

“Purchaser Material Adverse Effect” means any event, change, circumstance or
effect that, individually or in the aggregate, prevents, materially delays,
materially impairs or has a material adverse effect on the ability of Purchaser
to perform its obligations under this Agreement (including paying the Purchase
Price).

“Representatives” means, with respect to any Person, its officers, directors,
principals, partners, managers, members, employees, consultants, agents,
financial advisors, investment bankers, attorneys, accountants, other advisors
and other representatives.

“Restrictive Legend” has the meaning given to it in Section 5.04(a).

“Quarterly Cap” has the meaning given to it in Section 5.06(b)(ii).

“SEC” means the U.S. Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Shares” has the meaning given to it in the recitals.

 

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“Standstill Termination” has the meaning given to it in Section 5.02(a).

“Subsidiary” means, with respect to any Person, any other Person with respect to
which the first Person (x) has the voting power or such other right to elect a
majority of the board of directors or other persons performing similar functions
or (y) beneficially owns more than fifty percent (50%) of the voting stock (or
of any other form of voting or controlling equity interest in the case of a
Person that is not a corporation) or economic interest, in each case, directly
or indirectly through one or more other Persons.

“Termination and Settlement Agreement” means that certain agreement, dated as of
the date hereof, by and between the Company, the Purchaser, Parent and Merger
Sub.

“Transaction Documents” means this Agreement, the Termination and Settlement
Agreement, the Promissory Note and all other documents, certificates or
agreements executed in connection with the transactions contemplated by this
Agreement and the Termination and Settlement Agreement.

“Transactions” means the transactions expressly contemplated by this Agreement
and the other Transaction Documents.

“Transfer” by any Person means, directly or indirectly, to sell, transfer,
assign, pledge, encumber, hypothecate or otherwise dispose of or transfer (by
the operation of law or otherwise), or to enter into any contract, option or
other arrangement, agreement or understanding with respect to the sale,
transfer, assignment, pledge, encumbrance, hypothecation or other disposition or
transfer (by the operation of law or otherwise), of any voting interest in any
equity securities beneficially owned by such Person; provided, that transfers of
any equity interests in Amherst Single Family Residential Partners VI, LP or any
parent company thereof shall not be deemed a Transfer.

ARTICLE II

Purchase and Sale

Section 2.01 Purchase and Sale. At the Closing, the Purchaser shall purchase and
acquire from the Company an aggregate of 4,400,000 Shares, and the Company shall
issue, sell and deliver to the Purchaser, such Shares (the “Acquired Shares”)
for a purchase price per Acquired Share equal to $12.50 in cash and an aggregate
purchase price of $55,000,000 (such aggregate purchase price, the “Purchase
Price”). The purchase and sale of the Acquired Shares pursuant to this
Section 2.01 is referred to as the “Purchase.”

Section 2.02 Closing. (a) The closing of the sale and purchase of the Acquired
Shares (the “Closing”) shall occur at 10:00 a.m. (New York City time) as
promptly as reasonable practicable following the date of this Agreement on a
date selected by Purchaser that is no later than May 19, 2020, at the offices of
Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York, New York 10153, or at
such other place, time and date as shall be agreed between the Company and the
Purchaser (the date on which the Closing occurs, the “Closing Date”). The
Purchaser shall provide the Company with at least two (2) Business Days prior
written notice of the Closing Date.

 

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(b) At the Closing, (i) the Company shall deliver to the Purchaser the Acquired
Shares free and clear of all Liens, except restrictions imposed by this
Agreement, the Securities Act and any applicable securities Laws and (ii) the
Purchaser shall pay (or cause to be paid) the Purchase Price to the Company, by
wire transfer in immediately available U.S. federal funds, to the account
designated by the Company in writing.

ARTICLE III

Representations and Warranties of the Company

The Company hereby represents and warrants to the Purchaser as follows:

Section 3.01 Organization and Good Standing. The Company is a legal entity duly
organized, validly existing and in good standing under the Laws of its
jurisdiction of organization and has all requisite corporate or similar power
and authority to own, lease and operate its properties and assets and to carry
on its business as presently conducted and is qualified to do business and is in
good standing as a foreign legal entity in each jurisdiction where the
ownership, leasing or operation of its assets or properties or conduct of its
business requires such qualification, except where the failure to be so
organized, qualified or in good standing, or to have such power or authority,
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

Section 3.02 Equity Capital Structure. The authorized capital stock of the
Company consists of (A) 200,000,000 Shares and (B) 100,000,000 preferred shares,
par value $0.01 per share (the “Preferred Shares”). As of the close of business
on May 1, 2020 (the “Measurement Date”), 54,070,851 Shares were issued and
outstanding and no Preferred Shares were issued and outstanding. All of the
outstanding Shares have been duly authorized and validly issued and are fully
paid and nonassessable and free of preemptive rights, were issued in accordance
with applicable Law and were not issued in violation of any preemptive or other
similar rights. As of the Measurement Date there were an aggregate of 1,650,071
Shares reserved for, and 2,456,856 Shares subject to, issuance pursuant to the
Company Stock Plans. Except as provided in the preceding sentence and except for
Shares that after the date hereof become reserved for issuance or subject to
issuance as permitted under this Agreement, the Company has no Shares reserved
for, or subject to, issuance. The Company has no Preferred Shares or other
shares of capital stock reserved for or subject to issuance (it being understood
that “other shares of capital stock” shall not include Shares).

Section 3.03 Authority; Noncontravention. (a) The Company has full right, power
and authority to execute and deliver this Agreement and the other Transaction
Documents and to perform its obligations hereunder and thereunder and to
consummate the Transactions. The execution, delivery and performance by the
Company of this Agreement and the other Transaction Documents, and the
consummation by it of the Transactions, have been duly authorized by the Board
(or a duly authorized committee thereof) and no other action on the part of the
Company or its stockholders is necessary to authorize the execution, delivery
and performance by the Company of this Agreement and the other Transaction
Documents and the consummation by it of the Transactions. This Agreement has
been duly executed and delivered by the Company and, assuming due authorization,
execution and delivery hereof by the

 

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Purchaser, constitutes a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except that such
enforceability (i) may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar Laws of general
application affecting or relating to the enforcement of creditors’ rights
generally and (ii) is subject to general principles of equity, whether
considered in a proceeding at law or in equity (the “Bankruptcy and Equity
Exception”).

(b) Neither the execution and delivery of this Agreement or the other
Transaction Documents by the Company, nor the consummation of the Transactions
by the Company, nor performance or compliance by the Company with any of the
terms or provisions hereof or thereof, will (i) conflict with or violate any
provision of the Company Charter Documents, or (ii)(x) violate any Law or
Judgment applicable to the Company or any of its Subsidiaries or (y) violate or
constitute a default (or constitute an event which, with notice or lapse of time
or both, would violate or constitute a default) under any of the terms,
conditions or provisions of any Contract (as defined in the Merger Agreement) to
which the Company or any of its Subsidiaries is a party or accelerate the
Company’s or any of its Subsidiaries’, if applicable, obligations under any such
Contract, except, in the case of clause (ii), as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 3.04 No Consents Required. No consent, approval, authorization, order,
registration or qualification of or with any Governmental Authority is required
for the execution and delivery of this Agreement and the other Transaction
Documents by the Company, the performance by the Company of its obligations
hereunder and thereunder and the consummation by the Company of the
Transactions, except for (a) filings with the SEC under the Securities Act and
Exchange Act, (b) filing pursuant to state securities or blue sky laws, (c) the
filing and approval of a Supplemental Listing Application with the New York
Stock Exchange and (d) such consents, approvals, authorizations, orders,
registrations or qualifications (i) as have already been made or obtained or
(ii) where the failure to obtain any such consent, approval, authorization,
order, registration or qualification would not, individually or in the
aggregate, have a Material Adverse Effect.

Section 3.05 Brokers and Finders. The Company has not employed any broker or
finder or incurred any liability for any brokerage fees, commissions or finders’
fees in connection with the Merger or the other transactions contemplated in
this Agreement, except that the Company has engaged Deutsche Bank as the
Company’s financial advisor, the fees and expenses of which shall be paid solely
by the Company.

Section 3.06 No Other Representations or Warranties. Except for the
representations and warranties made by the Company in this Article III, in any
Transaction Documents or in any certificate or other document delivered in
connection with this Agreement or the Transaction Documents, neither the Company
nor any other Person acting on its behalf makes any other express or implied
representation or warranty with respect to the Shares, the Company or any of its
Subsidiaries or their respective businesses, operations, properties, assets,
liabilities, condition (financial or otherwise) or prospects, notwithstanding
the delivery or disclosure to the Purchaser or its Representatives of any
documentation, forecasts or other information with respect to any one or more of
the foregoing, and the Purchaser acknowledges the foregoing. In particular, and
without limiting the generality of the foregoing, except for the representations
and warranties

 

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made by the Company in this Article III, the Transaction Documents, or in any
certificate or other document delivered in connection with this Agreement or the
Transaction Documents, neither the Company nor any other Person makes or has
made any express or implied representation or warranty to the Purchaser or its
Representatives with respect to (a) any financial projection, forecast,
estimate, budget or prospect information relating to the Company, any of its
Subsidiaries or their respective businesses or (b) any oral or written
information presented to the Purchaser or its Representatives in the course of
its due diligence investigation of the Company, the negotiation of this
Agreement or the course of the Transactions or any other transactions or
potential transactions involving the Company and the Purchaser.

ARTICLE IV

Representations and Warranties of the Purchaser

The Purchaser represents and warrants to the Company:

Section 4.01 Organization; Standing. The Purchaser is duly organized, validly
existing and in good standing under the Laws of its jurisdiction of organization
and has all requisite power and authority to consummate the transactions
contemplated hereby.

Section 4.02 Authority; Noncontravention. (a) The Purchaser has all necessary
power and limited partnership authority to execute and deliver this Agreement
and the other Transaction Documents to which it is a party and to perform its
obligations hereunder and thereunder and to consummate the Transactions. The
execution, delivery and performance by the Purchaser of this Agreement and the
other Transaction Documents to which it is a party, and the consummation by the
Purchaser of the Transactions, have been duly authorized and approved by all
necessary action on the part of the Purchaser, and no further action, approval
or authorization by any of its members, is necessary to authorize the execution,
delivery and performance by the Purchaser of this Agreement and the other
Transaction Documents and the consummation by the Purchaser of the Transactions.
This Agreement has been duly executed and delivered by the Purchaser and,
assuming due authorization, execution and delivery hereof by the Company,
constitutes a legal, valid and binding obligation of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except that such
enforceability may be limited by the Bankruptcy and Equity Exception.

(b) Neither the execution and delivery of this Agreement or the other
Transaction Documents by the Purchaser, nor the consummation of the Transactions
by the Purchaser, nor performance or compliance by the Purchaser with any of the
terms or provisions hereof or thereof, will (i) conflict with or violate any
provision of the limited partnership agreement of the Purchaser, or (ii)(x)
violate any Law or Judgment applicable to the Purchaser or any of its
Subsidiaries or (y) violate or constitute a default (or constitute an event
which, with notice or lapse of time or both, would violate or constitute a
default) under any of the terms, conditions or provisions of any Contract to
which the Purchaser or any of its Subsidiaries is a party or accelerate the
Purchaser’s or any of its Subsidiaries’, if applicable, obligations under any
such Contract, except, in the case of clause (ii), as would not, individually or
in the aggregate, reasonably be expected to have a Purchaser Material Adverse
Effect.

 

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Section 4.03 No Consents Required. No consent, approval, authorization, order,
registration or qualification of or with any Governmental Authority is required
for the execution and delivery of this Agreement and the other Transaction
Documents by the Purchaser, the performance by the Purchaser of its obligations
hereunder and thereunder and the consummation by the Purchaser of the
Transactions, except for such consents, approvals, authorizations, orders,
registrations or qualifications (i) as have already been made or obtained or
(ii) where the failure to obtain any such consent, approval, authorization,
order, registration or qualification would not, individually or in the
aggregate, have a Purchaser Material Adverse Effect.

Section 4.04 Financing. The Purchaser currently has capital commitments
sufficient to, and at the Closing will have available funds necessary to,
consummate the Purchase and pay the Purchase Price on the terms and conditions
contemplated by this Agreement. The Purchaser is not aware of any reason why the
funds sufficient to fulfill its obligations under Article II (including paying
the Purchase Price) will not be available on the Closing Date.

Section 4.05 Brokers and Finders. The Purchaser has not employed any broker or
finder or incurred any liability for any brokerage fees, commissions or finders’
fees in connection with the Merger or the other transactions contemplated in
this Agreement, except for Persons whose fees and expenses shall be paid by the
Purchaser or its affiliates.

Section 4.06 Ownership of Shares; Interested Stockholder. Neither the Purchaser
nor any of its Affiliates beneficially owns, directly or indirectly, any Shares,
any rights or options to acquire any Shares, or any securities or instruments
convertible into, exchangeable for, or exercisable for Shares and neither the
Purchaser nor any of its Affiliates has any rights to acquire any Shares except
pursuant to this Agreement and the Merger Agreement (which is being terminated
pursuant to the Settlement Agreement). Neither the Purchaser nor any of its
Affiliates is, nor at any time has been, an “interested stockholder” of the
Company as defined in Section 3-601 of the MGCL.

Section 4.07 Purchase for Investment. The Purchaser acknowledges that the
Acquired Shares have not been registered under the Securities Act or under any
state or other applicable securities laws. The Purchaser (a) acknowledges that
it is acquiring the Acquired Shares pursuant to an exemption from registration
under the Securities Act solely for investment with no intention to distribute
any of the foregoing to any Person, (b) has such knowledge and experience in
financial and business matters and in investments of this type that it is
capable of evaluating the merits and risks of its investment in the Acquired
Shares and of making an informed investment decision, (c) is an “accredited
investor” (as that term is defined by Rule 501 of the Securities Act), (d) is a
“qualified institutional buyer” (as that term is defined in Rule 144A of the
Securities Act) and (e) (1) has reviewed the information that it considers
necessary or appropriate to make an informed investment decision with respect to
the Acquired Shares, (2) has had an opportunity to discuss with the Company and
its Representatives the intended business and financial affairs of the Company
and to obtain information necessary to verify the information furnished to it or
to which it had access and (3) can bear the economic risk of (i) an investment
in the Acquired Shares indefinitely and (ii) a total loss in respect of such
investment. The Purchaser has such knowledge and experience in business and
financial matters so as to enable it to understand and evaluate the risks of,
and form an investment decision with respect to its investment in, the Acquired
Shares.

 

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Section 4.08 Non-Reliance on Company Estimates, Projections, Forecasts,
Forward-Looking Statements and Business Plans. In connection with the due
diligence investigation of the Company by the Purchaser and its respective
Representatives, the Purchaser and its respective Representatives have received
and may continue to receive from the Company and its Representatives certain
estimates, projections, forecasts and other forward-looking information, as well
as certain business plan information, in each case containing forward-looking
information, regarding the Company and its Subsidiaries and their respective
businesses and operations. The Purchaser hereby acknowledges that there are
uncertainties inherent in attempting to make such estimates, projections,
forecasts and other forward-looking statements, as well as in such business
plans to the extent each of them contain forward-looking information, with which
the Purchaser is familiar, that the Purchaser is making its own evaluation of
the adequacy and accuracy of such forward-looking information so furnished to
the Purchaser (including the reasonableness of the assumptions underlying such
forward-looking information), and that except for the representations and
warranties made by the Company in Article III, the Transaction Documents and in
any certificate or other document delivered in connection with this Agreement or
the Transaction Documents, and other than for fraud, the Purchaser will have no
claim against the Company or any of its Subsidiaries, or any of their respective
Representatives, with respect thereto.

Section 4.09 No Other Representations or Warranties. Except for the
representations and warranties made by the Purchaser in this Article IV, the
Transaction Documents and in any certificate or other document delivered in
connection with this Agreement or the Transaction Documents, neither the
Purchaser nor any other Person acting on its behalf makes any other express or
implied representation or warranty with respect to the Purchaser or any of its
Affiliates or their respective businesses, operations, properties, assets,
liabilities, condition (financial or otherwise) or prospects, notwithstanding
the delivery or disclosure to the Company or its Representatives of any
documentation, forecasts or other information with respect to any one or more of
the foregoing, and the Company acknowledges the foregoing. In particular, and
without limiting the generality of the foregoing, except for the representations
and warranties made by the Purchaser in this Article IV, the Transaction
Documents and in any certificate or other document delivered in connection with
this Agreement or the Transaction Documents, neither the Purchaser nor any other
Person makes or has made any express or implied representation or warranty to
the Purchaser or its Representatives with respect to any oral or written
information presented to the Company or its Representatives in the course of its
due diligence investigation of the Company, the negotiation of this Agreement or
the course of the Transactions or any other transactions or potential
transactions involving the Company and the Purchaser.

ARTICLE V

Additional Agreements

Section 5.01 Public Disclosure. The Purchaser and the Company shall consult with
each other before issuing, and give each other the opportunity to review and
comment upon, the initial press release with respect to the Transaction
Documents and the Transactions. Additionally, the parties acknowledge that, in
connection with the execution and delivery of this Agreement, the Company will
file a Current Report on Form 8-K and the Purchaser will file a

 

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Schedule 13D with the SEC, each of which will report the entry into this
Agreement. The Schedule 13D and the Form 8-K shall be in form and substance
reasonably acceptable to the Company and the Purchaser, respectively.

Section 5.02 Standstill.

(a) The Purchaser agrees that until the two-year anniversary of the Closing Date
(the “Standstill Termination”), without the prior written approval of the Board,
the Purchaser will not, directly or indirectly, and will cause its Affiliates
not to, make any short sale of, or enter into any hedging or similar transaction
with the same economic effect as a short sale of, any Shares, or otherwise
establish or increase, directly or indirectly, a put equivalent position, as
defined in Rule 16a-1(h) under the Exchange Act, with respect to any of the
Shares (it being agreed that any broad-based index options, broad-based index
future, broad-based publicly traded market baskets and trading in (or with
respect to) securities of other industry participants shall not be restricted).

(b) Except as may be provided by the prior written approval of the Board, the
Purchaser agrees that until the Standstill Termination the Purchaser will not,
and will cause its Affiliates not to, directly or indirectly, in any manner:

(i) acquire, offer or seek to acquire, agree to acquire or make a public
proposal to acquire, by purchase or otherwise, any equity securities of the
Company, any securities convertible into or exchangeable for any such equity
securities, any options or other derivative securities or contracts or
instruments in any way related to the price of Shares (it being agreed that any
broad-based index options, broad-based index future, broad-based publicly traded
market baskets and trading in (or with respect to) securities of other industry
participants shall not be restricted); provided, that following the Closing,
subject to Section 7.2 of the Company’s Articles of Restatement, as amended, the
Purchaser and its Affiliates may acquire additional Shares so long as the
Purchaser and its Affiliates beneficially own, in the aggregate, no more than
9.8% of the Company’s then-outstanding Shares;

(ii) make or in any way participate in any “solicitation” of “proxies” (whether
or not relating to the election or removal of directors), as such terms are used
in the rules of the SEC, to vote, or knowingly seek to advise or influence any
Person with respect to voting of, any voting securities of the Company or call
or seek to call a meeting of the Company’s stockholders or initiate any
stockholder proposal or action by the Company’s stockholders, or seek election
to or to place a representative on the Board or seek the removal of any director
from the Board;

(iii) make any public announcement with respect to, or propose any merger or
business combination, tender or exchange offer, recapitalization, reorganization
or purchase of a material portion of the assets, properties or securities of the
Company or any of its Subsidiaries, or any other extraordinary transaction
involving the Company or any of its Subsidiaries, or enter into any
arrangements, understandings or agreements with any other Person regarding any
of the foregoing (other than as permitted pursuant to Section 5.06);

 

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(iv) otherwise act, alone or in concert with others, to seek to control or
influence, in any manner, the management, Board or policies of the Company or
any of its Subsidiaries;

(v) except as set forth herein, publicly make any proposal to the Company or its
management or Board with respect to, or issue any press releases or make any
statements which could reasonably be expected to become public with respect to:
(A) any change in the number or term of directors or the filling of any
vacancies on the Board, (B) any material change in the capitalization or
dividend policy of the Company, (C) any other change in the Company’s
management, business or corporate structure, (D) any waiver, amendment or
modification to the Company Charter Documents, or other actions which may impede
the acquisition of control of the Company by any person in any way whatsoever,
(E) causing a class of securities of the Company to be delisted from, or to
cease to be authorized to be quoted on, any securities exchange, or (F) causing
a class of equity securities of the Company to become eligible for termination
of registration pursuant to Section 12(g)(4) of the Exchange Act;

(vi) make any request for stock list materials or other books and records of the
Company under Maryland law;

(vii) make any public proposal or statement of inquiry or publicly disclose any
intention, plan or arrangement consistent with the foregoing;

(viii) advise, assist, knowingly encourage or direct any Person to do, or to
advise, assist, encourage or direct any other Person to do, any of the
foregoing;

(ix) take any action that would, in effect, require the Company to make a public
announcement with respect to any of the foregoing;

(x) enter into any arrangements or understandings with any third party
(including, without limitation, security holders of the Company) with respect to
any of the foregoing, including, without limitation, forming, joining or in any
way participating in a “group” (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act) with any third party with respect to any of the foregoing;
or

(xi) request the Company or any of its Representatives, directly or indirectly,
to amend or waive any provision of this Section 5.02, provided that this clause
shall not prohibit the Purchaser from making a confidential request to the
Company seeking an amendment or waiver of the provisions of this Section 5.02,
which the Company may accept or reject in its sole discretion, so long as any
such request is made in a manner that does not require public disclosure thereof
by the Company and, provided further, that notwithstanding anything to the
contrary in this Section 5.02, the Purchaser and its Affiliates may at any time
communicate privately with the Company’s directors, officers or advisors or
submit to the Board one or more confidential proposals or offers for a
transaction (including a transaction that, if consummated, would result in a
change of control of the Company), so long as, in each case, such communications
and submissions are not intended to, and would not reasonably be expected to,
require any public disclosure by the Company of such communications or
submissions, as applicable.

 

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(c) The obligations under this Section 5.02 shall automatically terminate upon a
Change of Control Date.

Section 5.03 Voting.

(a) The Purchaser agrees that until the two-year anniversary of the Closing
Date, for so long as the Purchaser owns any Shares, at each meeting of the
stockholders of the Company and at every postponement or adjournment thereof,
the Purchaser shall take such action as may be required so that all of the
Shares beneficially owned, directly or indirectly, by the Purchaser and its
Affiliates and entitled to vote at such meeting of stockholders are voted (i) in
favor of each director nominated and recommended by the Board (or a duly
authorized committee thereof) for election at any such meeting, (ii) against any
stockholder nominations for directors which are not approved and recommended by
the Board (or a duly authorized committee thereof) for election at any such
meeting and (iii) otherwise in accordance with the Board’s recommendation on all
proposals properly brought before any meeting of stockholders of the Company.

(b) The Purchaser agrees that until the two-year anniversary of the Closing
Date, for so long as the Purchaser owns any Shares, the Purchaser shall (to the
extent necessary to comply with this Section 5.03) be present, in person or by
proxy, at all meetings of the stockholders of the Company so that all Shares
beneficially owned by the Purchaser and its Affiliates may be counted for the
purposes of determining the presence of a quorum and voted in accordance with
Section 5.03(a) at such meetings (including at any adjournments or postponements
thereof).

Section 5.04 Legend. (a) All Acquired Shares will bear a legend (the
“Restrictive Legend”) substantially to the following effect:

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (I) AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS, OR WHILE A REGISTRATION
STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS AND (II) THE EXCEPTIONS TO THE RESTRICTIONS ON TRANSFER UNDER
THE INVESTMENT AGREEMENT, DATED MAY 4, 2020 BETWEEN THE ISSUER AND AMHERST
SINGLE FAMILY RESIDENTIAL PARTNERS VI, LP.

(b) Upon request of the Purchaser, the Restrictive Legend will be removed on
such number of Acquired Shares equal to the Quarterly Cap (as defined below) in
each of the calendar quarters following the one-year anniversary of the Closing
Date, and upon a Change of Control Date the Restrictive Legend will be removed
on all of the Acquired Shares, and, in each case, the Company shall issue a
certificate representing the Acquired Shares without such legend to the holder
of such certificate or issue to such holder by electronic delivery at the
applicable balance account at The Depository Trust Company if (i) such Acquired
Shares are registered for

 

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resale under the Securities Act or (ii) such Shares are eligible for sale under
Rule 144 under the Securities Act. If required by the Company’s transfer agent,
the Company shall cause its counsel to issue a legal opinion, at the sole cost
and expense of the Purchaser, to the Company’s transfer agent to effect the
removal of the Restrictive Legend within five (5) Business Days after receipt of
customary representation letters in support of such opinion.

Section 5.05 Registration Rights. Following the one-year anniversary of the
Closing Date, upon the Purchaser’s written request (provided, that Purchaser may
not make such a request more than one time per quarter), the Company will use
commercially reasonable efforts to cooperate in good faith with the Purchaser to
facilitate the Purchaser’s Transfer of the Acquired Shares in accordance with
the terms of this Agreement by (i) including the Acquired Shares in any
registration statement and offering made by the Company or (ii) otherwise
assisting in the registration of such Acquired Shares. Notwithstanding the
foregoing, the Company shall have no obligation to include the Acquired Shares
in any registrations on Form S-4 or Form S-8 (or any successor forms thereto).

Section 5.06 Transfers.

(a) The Purchaser acknowledges that none of the Acquired Shares have been
registered under the Securities Act.

(b) The Purchaser further agrees that:

(i) until the first anniversary of the Closing Date, the Purchaser shall not be
permitted to Transfer any of the Acquired Shares other than to a Permitted
Transferee; provided, that any Transfer to a Permitted Transferee shall only be
permitted if the Permitted Transferee enters into, prior to such Transfer, a
customary joinder in form and substance reasonably acceptable to the Company in
which such Permitted Transferee agrees in writing to be bound by the provisions
of this Agreement as a “Purchaser”; and

(ii) beginning on the first anniversary of the Closing Date, the Purchaser may
Transfer up to 1,100,000 of the Acquired Shares, plus the Excess Shares (if any)
(in each case subject to appropriate adjustment in the event of any share
dividend, share split, combination or other similar recapitalization) in the
aggregate in each of the calendar quarters following the one-year anniversary of
the Closing Date (the “Quarterly Cap”); provided, that Transfers to Permitted
Transferees shall not count towards the Quarterly Cap and may be made without
restrictions hereunder to the extent they satisfy the provisions of the proviso
in the preceding clause (i). For example, if Purchaser sells 500,000 Acquired
Shares in the first quarter ending after the first anniversary of the Closing
Date, Purchaser shall be entitled to Transfer 1,700,000 of the Acquired Shares
in the second quarter ending after the first anniversary of the Closing Date and
if Purchaser sells 600,000 of the Acquired Shares in the second quarter of the
Closing Date, Purchaser shall be entitled to Transfer

 

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2,200,000 of the Acquired Shares in the third quarter ending after the first
anniversary of the Closing Date.

(c) Following a written request by the Company until such time as Purchaser and
its Affiliates no longer beneficially own any Shares, Purchaser shall inform the
Company in writing of the number of Shares beneficially owned by the Purchaser
and its Affiliates.

(d) Notwithstanding anything to the contrary contained herein, all restrictions
on Transfer in this Section 5.06 and the obligations under clause (c) above,
shall automatically terminate on the earlier of (such earlier date, a “Change of
Control Date”) (x) the date that is the second anniversary of the Closing Date
and (y) the first date that (i) the Company enters into a definitive agreement
with any other person or “group” of persons that, if consummated, would involve
the direct or indirect acquisition of (A) all or a majority of the Company’s
equity securities (or, following which transaction the persons and entities who,
immediately prior to such transaction, beneficially owned securities
representing a majority of the voting power of the Company do not continue to
beneficially own, directly or indirectly, a majority of the voting power of the
combined entity) or (B) a majority of the Company and its subsidiaries’ assets,
on a consolidated basis (based on fair market value), in each case (A) and (B),
other than in connection with an internal restructuring transaction involving
only the Company, one or more of its subsidiaries and/or any holding company
formed for the purpose of such transaction or (ii) a tender or exchange offer
(other than a self-tender offer initiated in connection with a share buyback
program) is commenced by any person that, if consummated, would result in all or
a majority of the Company’s equity securities being owned by persons other than
the Company, and the Board (or a committee thereof) fails to recommend within
ten (10) Business Days from the date of commencement of such offer that its
stockholders reject such offer.

Section 5.07 Sales of Assets; Financing. For one-year period following the
Closing Date, (i) to the extent the Company or any of its Subsidiaries
determines to pursue a sale of assets representing five percent (5%) or more of
the assets of the Company and its Subsidiaries, taken as a whole (based on book
value) (excluding a transaction that, if consummated, would result in a change
of control of the Company) (an “Asset Sale Transaction”), the Company will
inform the Purchaser of its intent to pursue such an Asset Sale Transaction and
provide the Purchaser with the opportunity to participate in the process related
to such Asset Sale Transaction and (ii) to the extent the Company or any of its
Subsidiaries determines to pursue a debt or equity financing transaction
(including a new or replacement credit facility, note, an issuance of debt
securities, preferred shares, warrants or other equity-linked securities), for
an amount representing five percent (5%) or more of the equity market
capitalization of the Company (a “Financing Transaction”), the Company will
inform the Purchaser of its intent to pursue such a Financing Transaction and
provide the Purchaser with the opportunity to participate in the process related
to such Financing Transaction; provided, that in no event shall the Company be
obligated to enter into an Asset Sale Transaction or Financing Transaction with
the Purchaser by virtue of this Section 5.07.

Section 5.08 Trading. The Company acknowledges and agrees that from and after
the filing of the Company’s quarterly report on Form 10-Q for the quarterly
period ended March 31, 2020 (which shall be filed with the SEC no later than
May 15, 2020), (i) except as otherwise contemplated by Section 5.02(b)(i) of
this Agreement, none of Purchaser or any of its Affiliates

 

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owes the Company or any of its Affiliates any duty or is otherwise subject to
any obligation to the Company or its Affiliates that would restrict or prevent
Purchaser or any of its Affiliates from purchasing securities of the Company and
(ii) if requested by Purchaser, the Company will inform the Purchaser as to
whether the Board is or is not in a “blackout period” in accordance with the
Company’s insider trading policy. For the avoidance of doubt, any such purchases
are subject to the ownership limitation set forth in Section 5.02(b)(i) above.

Section 5.09 Supplemental Listing Application. The Company shall promptly (and
within four (4) Business Days of the date hereof) file with the New York Stock
Exchange a supplemental listing application for the Acquired Shares and use its
reasonable best efforts to effect the listing of the Acquired Shares on the New
York Stock Exchange.

ARTICLE VI

Termination; Survival

Section 6.01 Termination.

(a) This Agreement may be terminated by either party if the Closing does not
occur on or prior to May 20, 2020; provided, that a party may not terminate this
Agreement under this Section 6.01(a) if it is in breach of its obligations under
this Agreement.

(b) This Agreement may be terminated and the Transactions abandoned at any time
prior to the Closing by the mutual written consent of the Company and the
Purchaser.

Section 6.02 Survival. The representations and warranties contained in Article
III and Article IV of this Agreement shall survive for one year after the
Closing. All of the covenants or other agreements of the parties contained in
this Agreement shall survive until fully performed or fulfilled, unless and to
the extent that non-compliance with such covenants or agreements is waived in
writing by the party entitled to such performance.

ARTICLE VII

Miscellaneous

Section 7.01 Modification or Amendment. This Agreement may only be amended,
modified or supplemented in writing by the parties hereto, by action of the
boards of directors (or comparable body) of the respective parties.

Section 7.02 Waiver. Any provision of this Agreement may be waived if, and only
if, such waiver is in writing and signed by the party against whom the waiver is
to be effective. No failure or delay by any party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. Except as otherwise herein
provided, the rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by Law.

 

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Section 7.03 Counterparts; Effectiveness. This Agreement may be executed in any
number of counterparts (including by attachment to electronic mail in portable
document format (PDF)), each such counterpart being deemed to be an original
instrument, and all such counterparts shall together constitute the same
agreement, and shall become effective when one or more counterparts have been
signed by each of the parties hereto and delivered to the other parties hereto.

Section 7.04 Governing Law and Venue; Waiver of Jury Trial. (a) THIS AGREEMENT
AND ANY DISPUTES ARISING UNDER OR RELATING TO THIS AGREEMENT SHALL BE DEEMED TO
BE MADE IN AND IN ALL RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY
AND IN ACCORDANCE WITH THE LAW OF THE STATE OF DELAWARE WITHOUT REGARD TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.

(b) Each of the parties (i) irrevocably submits exclusively to the jurisdiction
of the Chancery Courts of the State of Delaware (the “Chancery Court”) or, if
the Chancery Court declines jurisdiction, any other Delaware state court, and
the federal courts of the United States of America, in each case, located in New
Castle County in the State of Delaware (collectively, “Chosen Courts”) in the
event any dispute arises out of this Agreement or any of the transactions
contemplated hereby, (ii) agrees that it will not attempt to deny or defeat such
personal jurisdiction by motion or other request for leave from any such court,
(iii) agrees that it will not bring any Proceeding (as defined in the Merger
Agreement) by or before any Governmental Authority relating to this Agreement or
any of the transactions contemplated hereby in any court other than the Chosen
Courts, (iv) waives any objection that it may now or hereafter have to the venue
of any such Proceeding in the Chosen Courts or that such Proceeding was brought
in an inconvenient court and agrees not to plead or claim the same and
(v) consents to service being made through the notice procedures set forth in
Section 7.05. Each of the Company and the Purchaser hereby agrees that service
of any process, summons, notice or document by U.S. registered mail to the
respective addresses set forth in Section 7.05 shall be effective service of
process for any Proceeding in connection with this Agreement or the transactions
contemplated hereby.

(c) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY
RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH PARTY
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH
PARTY MAKES THIS WAIVER VOLUNTARILY AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG

 

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OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 7.04.

Section 7.05 Notices. Notices, requests, instructions or other documents to be
given under this Agreement shall be in writing and shall be deemed given,
(a) when delivered, if delivered personally to the intended recipient, (b) upon
transmission, if sent by email (provided no “bounceback” or notice of
non-delivery is received) and (c) one Business Day later, if sent by overnight
delivery via a national courier service (providing proof of delivery), and in
each case, addressed to a party at the following address for such party:

if to the Company

Front Yard Residential Corporation

5100 Tamarind Reef

Christiansted, United States Virgin Islands 00820

Attention:   Michael Lubin

Email:         frontyardresidential@altisourceamc.com

with copies to (which shall not constitute notice):

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Attention:   Michael J. Aiello

    Sachin Kohli

Email:        michael.aiello@weil.com

      sachin.kohli@weil.com

if to Purchaser:

c/o Amherst Residential, LLC

5001 Plaza on the Lake, Suite 200

Austin, TX 78746

Attention:     Joseph Gatti

Email:     jgatti@amherst.com

with copies to (which shall not constitute notice):

Gibson, Dunn & Crutcher LLP

200 Park Avenue

New York, NY 10166

Attention:   Eduardo Gallardo

Email:         egallardo@gibsondunn.com

or to such other persons or addresses as may be designated in writing by the
party to receive such notice as provided above.

 

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Section 7.06 Entire Agreement. This Agreement, the Termination and Settlement
Agreement, the letter agreement regarding confidentiality, dated August 31,
2019, between the Company and an affiliate of Purchaser (as amended on the date
hereof), the letter agreement regarding confidentiality, dated December 6, 2019,
between the Company and an affiliate of Purchaser, the waiver letter agreement
regarding ownership of Shares dated as of the date hereof, by and between the
Company and Purchaser, and the Promissory Note (including any exhibits to the
foregoing agreements) constitute the entire agreement, and supersede all other
prior agreements, understandings, representations and warranties both written
and oral, among the parties, with respect to the subject matter hereof.

Section 7.07 No Third-Party Beneficiaries. This Agreement is not intended to,
and does not, confer upon any Person other than the parties hereto any rights or
remedies hereunder.

Section 7.08 Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof. If any
provision of this Agreement, or the application thereof to any Person or any
circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision negotiated in good faith by the parties hereto shall be substituted
therefor in order to carry out, so far as may be valid and enforceable, the
intent and purpose of such invalid or unenforceable provision and (b) the
remainder of this Agreement and the application of such provision to other
Persons or circumstances shall not, subject to clause (a) above, be affected by
such invalidity or unenforceability, except as a result of such substitution,
nor shall such invalidity or unenforceability affect the validity or
enforceability of such provision, or the application thereof, in any other
jurisdiction.

Section 7.09 Interpretation. (a) The table of contents and the Article, Section
and paragraph headings or captions herein are for convenience of reference only,
do not constitute part of this Agreement and shall not be deemed to limit or
otherwise affect any of the provisions hereof. Where a reference in this
Agreement is made to a Section or Exhibit, such reference shall be to a Section
of or Exhibit to this Agreement unless otherwise indicated. Whenever the words
“include”, “includes” or “including” are used in this Agreement, they shall be
deemed to be followed by the words “without limitation”. The words “hereof”,
“herein” and “hereunder” and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement. The word “or” when used in this Agreement is not exclusive. The
word “extent” in the phrase “to the extent” shall mean the degree to which a
subject or other thing extends, and such phrase shall not mean simply “if”. All
terms defined in this Agreement shall have the defined meanings when used in any
certificate or other document made or delivered pursuant hereto unless otherwise
defined therein. The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such term. Any agreement,
instrument or statute defined or referred to herein or in any agreement or
instrument that is referred to herein means such agreement, instrument or
statute as from time to time amended, modified or supplemented, including (in
the case of agreements or instruments) by waiver or consent and (in the case of
statutes) by succession of comparable successor statutes and references to all
attachments thereto and instruments incorporated therein.

 

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(b) The parties have participated jointly in negotiating and drafting this
Agreement. In the event that an ambiguity or a question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provision of this
Agreement.

Section 7.10 Assignment. This Agreement shall not be assigned by operation of
law or otherwise without the prior written consent of each of the other parties
hereto, and any assignment without such consent shall be null and void.

Section 7.11 Specific Performance. The parties hereto acknowledge and agree that
irreparable damage would occur and that the parties would not have any adequate
remedy at Law in the event that any of the obligations, undertakings, covenants
or agreements of the parties to this Agreement were not performed in accordance
with their specific terms or were otherwise breached, and that monetary damages,
even if available, would not be an adequate remedy therefor. It is accordingly
agreed that the Company, on the one hand, and the Purchaser, on the other hand,
shall be entitled to seek an injunction or injunctions to prevent breaches of
this Agreement by the other party, and to enforce specifically the terms and
provisions of this Agreement by a decree of specific performance, in accordance
with Section 7.04 of this Agreement, without the necessity of proving actual
harm or damages or posting a bond or other security therefor, this being in
addition to any other remedy to which such party is entitled at law or in
equity, and each party agrees that it will not oppose the granting of an
injunction, specific performance or other equitable relief on the basis that any
other party has an adequate remedy at law or that any award of specific
performance or other equitable remedy is not an appropriate remedy for any
reason at law or in equity.

Section 7.12 Expenses. Except as otherwise expressly provided herein or in any
other Transaction Document, all costs and expenses, including fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the Transactions shall be paid by the party
incurring such costs and expenses.

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the date first above written.

 

FRONT YARD RESIDENTIAL CORPORATION By:  

/s/ George G. Ellison

  Name: George G. Ellison   Title: Chief Executive Officer

[Signature Page to Investment Agreement]

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AMHERST SINGLE FAMILY RESIDENTIAL PARTNERS VI, LP

 

By: Amherst SFRP VI GP, LLC, its general partner

By:  

/s/ Joseph Gatti

  Name: Joseph Gatti   Title:   Vice President and Secretary

[Signature Page to Investment Agreement]