Exhibit 10.3

 

NON-QUALIFIED STOCK OPTION AWARD AGREEMENT

 

THIS NON-QUALIFIED STOCK OPTION AWARD AGREEMENT (the “Agreement”) is made as of
April 15, 2015 (the “Grant Date”), between Altisource Portfolio Solutions S.A.,
a Luxembourg société anonyme (“Altisource” and, together with its subsidiaries
and affiliates, the “Company”), and [   ], an employee of the Company (the
“Employee”).

 

WHEREAS, the Company desires, by affording the Employee an opportunity to
purchase shares of its common stock, par value $1.00 per share (“Shares”), to
further the objectives of the Company’s 2009 Equity Incentive Plan (the “2009
Plan”).

 

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth
and for other good and valuable consideration, and intending to be legally bound
hereby, the parties hereto have agreed, and do hereby agree, as follows:

 

1.                                      OPTION GRANT

 

The Company hereby grants to the Employee, pursuant to and subject to the 2009
Plan, the right and option to purchase all or any part of an aggregate
[          ] Shares from the Company for a purchase price of $[          ] per
share (the “Strike Price”), on the terms and conditions set forth in this
Agreement (the “Options”).

 

2.                                      OPTION TERM

 

The term of the Options shall begin on the date of this Agreement and will
continue for a period of ten (10) years from the date of this Agreement, except
as provided in Section 5 below.

 

3.                                      VESTING OF OPTIONS

 

A.                                    Subject to the provisions of Sections 5
and 6 below, the Options shall vest in three (3) equal annual increments, as
follows.  One-third (1/3) of the Options shall vest on each anniversary of the
Grant Date commencing on the first anniversary of the Grant Date continuing
until all Options are vested.

 

B.                                    Accelerated Vesting

 

Notwithstanding the vesting schedule provided in Section 3, Subsection A above,
if the Employee’s employment is terminated by reason of (a) death or Disability
or (b) Retirement, then the Options shall vest and shall become immediately
exercisable in full on the date of such termination; provided, however, that the
Employee’s right to such accelerated vesting is subject to the requirement that
the Employee has been employed with the Company for a period of at least two
(2) years on the date of death or Disability, or three (3) years on the date of
Retirement, unless otherwise determined by the Company in its sole discretion.

 

1

--------------------------------------------------------------------------------

 

C.                                    General

 

The Employee shall have none of the rights of a stockholder with respect to any
of the Shares subject to the Options until such Shares shall be issued in the
Employee’s name or the name of the Employee’s designee following the exercise of
the Options.

 

4.                                      METHOD OF OPTION EXERCISE

 

A.                                    Subject to the terms and conditions of
this Agreement, the Options may be exercised by written notice to the Company at
its executive offices to the attention of the Corporate Secretary of the Company
(the “Secretary”). Such notice shall state the election to exercise the Options,
shall state the number of shares in respect of which it is being exercised (the
“Purchased Shares”) and shall be signed by the person or persons so exercising
the Options.  In no case may the Options be exercised as to less than fifty (50)
Shares at any one time (or the remaining Shares then purchasable under the
Options, if less than fifty (50) Shares) or for a fractional Share. Except as
provided in Section 5 below, the Options may not be exercised unless the
Employee shall, at the time of the exercise, be an employee of the Company.
During the Employee’s lifetime, only the Employee or the Employee’s guardian or
legal representative may exercise the Options.

 

B.                                    Such notice shall be accompanied by (i) a
personal check payable to the order of the Company for payment of the full
purchase price of the Purchased Shares, (ii) delivery to the Company of the
number of Shares duly endorsed for transfer and owned by the Employee that have
an aggregate Fair Market Value equal to the aggregate purchase price of the
Purchased Shares or (iii) payment therefor made in such other manner as may be
acceptable to the Company on such terms as may be determined by the Compensation
Committee of the Board of Directors (the “Committee”). “Fair Market Value” shall
have the meaning given to that term in the 2009 Plan. In addition to and at the
time of payment of the purchase price, the person exercising the Options shall
pay to the Company the full amount of any federal and state withholding or other
taxes applicable to the taxable income of such person resulting from such
exercise in cash unless the Committee in its sole discretion shall permit such
taxes to be paid in Shares. Such payment may also be made in the form of payroll
withholding, at the election of the option holder. The Company shall issue the
Shares of the said Purchased Shares as soon as practicable after receipt of the
notice and all required payments by the person or persons exercising the Options
as provided in Section 4, Subsection A above. Unless the person or persons
exercising the Options shall otherwise direct the Company in writing, such
Shares shall be registered in the name of the person or persons so exercising
the Options and shall be delivered as aforesaid to or upon the written order of
the person or persons exercising the Options.

 

2

--------------------------------------------------------------------------------

 

C.                                    In the event the Options shall be
exercised, pursuant to Sections 3 and 5 hereof, by any person or persons other
than the Employee, such notice shall be accompanied by appropriate proof of the
derivative right of such person or persons to exercise the Options.

 

D.                                    The date of exercise of the Options shall
be the date on which the notice, the documents and all payments required under
this Section 4 are received by or arranged with the Secretary. If such notice is
received after the market closes, the following trading day will be considered
the date of exercise. All Shares that shall be purchased upon the exercise of
the Options as provided herein shall be fully paid and non-assessable.

 

E.                                     The Company may require the Employee to
exercise the Options electronically through the Shareworks system or any other
online system pursuant to the procedures set forth therein as determined by the
Company in its sole discretion.

 

F.                                      The Company may amend the procedures set
forth in Section 4, Subsections A through E in its sole discretion.

 

5.                                      TERMINATION OF OPTIONS

 

The Options may not be exercised to any extent after termination of the Options
in one of the ways, whichever first occurs, set forth below in this Section 5.

 

A.                                    The Options shall terminate upon the
exercise of such Options in the manner provided in this Agreement and the 2009
Plan, whether or not the Shares are ultimately delivered.

 

B.                                    Except as may otherwise be provided in
Section 5, Subsection C below for the earlier termination of the Options, the
Options and all rights and obligations thereunder shall expire ten (10) years
after the date of this Agreement.

 

C.                                    If, prior to exercise, expiration,
surrender or cancellation of the Options, the Employee’s employment terminates,
the Options shall terminate in accordance with the 2009 Plan except as follows:

 

(1)                       by reason of Disability or Retirement, then the
Options shall terminate not later than (a) five (5) years after the date of such
termination of employment or (b) the end of the Option’s term, whichever occurs
first. In the event of the death of the Employee after such termination of
employment, the Options shall terminate on the earlier to occur of: (i) three
(3) years after the date of the Employee’s death; or (ii) the end of the
Option’s term, during which period the Options may be exercised by the person or
persons to whom the Employee’s rights shall pass by will or by the applicable
laws of descent or distribution.

 

3

--------------------------------------------------------------------------------

 

(2)                       by reason of death, then the Options shall terminate
three (3) years after the date of the Employee’s death, during which period the
Options may be exercised at any time by the person or persons to whom the
Employee’s rights shall pass by will or by the applicable laws of descent or
distribution.

 

(3)                       by reason of termination of employment by the Company
for Cause or termination of employment by the Employee, then all Options shall
terminate on such date of termination of employment.

 

(4)                       by reason of termination of employment by the Company
without Cause, then all unvested Options shall terminate on the date of such
termination of employment and all vested Options shall terminate on the six
(6) month anniversary of the date of such termination of employment.

 

D.                                    The Employee’s right to retain any Options
following termination of employment under this Section 5 is subject in all cases
to the requirement that the Employee has been employed with the Company for a
period of at least two (2) years on the date of such termination of employment,
or three (3) years in the case of Retirement, unless otherwise determined by the
Company in its sole discretion.

 

6.                                      CONDITIONS UPON TERMINATION OF
EMPLOYMENT

 

A.                                    For a period of two (2) years following
the Employee’s departure from the Company, the Employee shall not (A) engage,
either directly or indirectly, in any manner or capacity as advisor, principal,
agent, partner, officer, director, employee, member of any association or
otherwise, in any business or activity which is at the time competitive with any
business or activity conducted by the Company, (B) solicit, directly or
indirectly, any employee of the Company to leave the employ of the Company for
employment, hire or engagement as an independent contractor elsewhere, (C) in
any way interfere with the relationship between any customer, supplier, licensee
or business relation of the Company or (D)  share, reveal or utilize any
Confidential Information of the Company except as otherwise expressly permitted
by Company.

 

B.                                    For a period of two (2) years following
the Employee’s departure from the Company, the Employee shall be available at
reasonable times for consultations at the request of the Company’s management
with respect to phases of the business with which the Employee was actively
connected during the Employee’s employment, but such consultations shall not be
required to be performed during usual vacation periods or periods of illness or
other incapacity or without reasonable compensation and cost reimbursement.

 

4

--------------------------------------------------------------------------------

 

C.                                    The Employee acknowledges that the Company
would not have awarded the Options granted to the Employee under this Agreement
absent the Employee’s agreement to be bound by the covenants made in this
Section 6.

 

D.                                    In the event that the Employee fails to
comply with any of the promises made in this Section 6, then in addition to and
not in limitation of any and all other remedies available to the Company at law
or in equity (a) the Options, to the extent then unexercised, whether vested or
unvested, will be immediately forfeited and cancelled and (b) the Employee will
be required to immediately deliver to the Company an amount (in cash or in
Shares) equal to the market value (on the date of exercise) of any Shares
acquired on exercise of the Options less the exercise price paid for such Shares
(the “Share Value”) to the extent such Shares were acquired by the Employee upon
exercise of the Options at any time from 180 days prior to the earlier of
(i) the date of termination of employment or (ii) the date the Employee fails to
comply with any promise made in this Section 6, to 180 days after the date when
the Company learns that the Employee has not complied with any such promise. The
Employee will deliver such Share Value amount (either in cash or in Shares) to
the Company on such terms and conditions as may be required by the Company. The
Company will be entitled to enforce this repayment obligation by all legal means
available, including, without limitation, to set off the Share Value amount and
any other damage amount against any amount that might be owed to the Employee by
the Company.

 

E.                                     The Employee further acknowledges that in
the event that the covenants made in this Section 6 are not fulfilled, the
damage to the Company would be irreparable. The Company, in addition to any
other remedies available to it, including, without limitation, the remedies set
forth in Section 6, Subsection (D) above, shall be entitled to injunctive relief
against the Employee’s breach or threatened breach of said covenants.

 

F.                                      Any determination by the Board of
Directors with regard to Section 6, Subsections (D) and (E) shall be conclusive.

 

7.                                      ADJUSTMENT UPON CHANGES IN STOCK; CHANGE
OF CONTROL/RESTRUCTURING EVENT

 

A.                                    Except to the extent governed by
Section 7, Subsection (B) below, if there shall be any change in the Shares
subject to the Options granted hereunder, through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split, spin off of one
or more subsidiaries or other change in the corporate structure, appropriate
adjustments shall be made by the Board of Directors in its discretion (or if the
Company is not the surviving company in any such transaction, the Board of
Directors of the surviving company — with the Board of Directors of the Company
and the surviving company collectively referred to in this Section 7 as

 

5

--------------------------------------------------------------------------------

 

the “Board”) in the aggregate number and kind of shares subject to the 2009 Plan
and the number and kind of shares and the price per share subject to the
Options. Without limiting the generality of the foregoing, in the event of a
restructuring or transaction resulting in some or all of the Company’s Shares
being convertible into equity of a separate company, the Board shall have the
authority to replace outstanding Options with any one or more of the following:
(A) adjusted options of the Company; (B) adjusted options on the equity of the
separate company; and (C) a combination of adjusted options on the shares of
both the Company and the separate company, all as the Board sees as equitable.
In the event of any such option adjustment and/or conversion, the Board shall
attempt to reasonably approximate the aggregate value of the Employee’s
outstanding Options under this Agreement. For the avoidance of doubt, in the
event Employee remains employed with the separate company that results from a
restructuring or transaction covered by this Section 7, for purposes of this
Agreement, the Employee will be deemed to remain employed as if the Employee
continued employment with the Company such that the employment termination
provisions applicable to Options shall not be invoked unless and until the
Employee’s employment with such separate company shall terminate.

 

B.                                    If a Change of Control/Restructuring Event
occurs, the acquiring person or entity shall have the right to cancel the
Options in exchange for a payment equal to the then intrinsic value of the
Options as determined by the Board, effective as of the Change of
Control/Restructuring Date or to allow the Options to continue in full force and
effect in accordance with the terms hereof. If the Options are to remain in
place following such Change of Control/Restructuring Event, the Board shall have
the right in its discretion to make appropriate adjustments in the aggregate
number and kind of Shares and the price per Share subject to the Options. Such
discretions shall include the authority to replace outstanding Options with any
one or more of the following: (a) adjusted options of the Company; (b) adjusted
options on the equity of any separate company surviving such Change of
Control/Restructuring event; and (c) a combination of adjusted options on the
shares of both the Company and the separate company, as such Board sees as
equitable. In the event of any such option adjustment and/or conversion, such
Board shall shall attempt to reasonably approximate the aggregate value of the
Employee’s outstanding Options under this Agreement.

 

8.                                      NON-TRANSFERABILITY OF OPTIONS

 

The Options shall not be transferable otherwise than by will or by the
applicable laws of descent and distribution. More particularly (but without
limiting the generality of the foregoing), the Options may not be assigned,
transferred (except as aforesaid), pledged or hypothecated in any way (whether
by operation of law or otherwise) and shall not be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
hypothecation or other disposition of

 

6

--------------------------------------------------------------------------------

 

the Options contrary to the provisions hereof, and the levy of any execution,
attachment or similar process upon the Options, shall be null and void and
without effect.

 

9.                                      PAYMENT OF EXPENSES AND COMPLIANCE WITH
LAWS

 

The Company shall at all times during the term of the Options reserve and keep
available such number of Shares as will be sufficient to satisfy the
requirements of this Agreement, shall pay all original issue and/or transfer
taxes with respect to the issue and/or transfer of Shares pursuant hereto and
all other fees and expenses necessarily incurred by the Company in connection
therewith and will from time to time use its best efforts to comply with all
laws and regulations which, in the opinion of counsel for the Company, shall be
applicable thereto.

 

10.                               DEFINITIONS

 

A.                                    As used herein, the term “Cause” shall
mean, as reasonably determined by the Board of Directors (excluding the
Employee, if the Employee is then a member of the Board of Directors) either
(i) any willful or grossly negligent conduct (including but not limited to fraud
or embezzlement) committed by the Employee in connection with the Employee’s
employment by the Company which conduct in the reasonable determination of the
Board of Directors has had or will have a material detrimental effect on the
Company’s business or (ii) the Employee’s conviction of, or entering into a plea
of nolo contendere to, a felony involving fraud or embezzlement, whether or not
committed in the course of the Employee’s employment with the Company.

 

B.                                    As used herein, “Change of
Control/Restructuring Date” shall mean either the date (i) which includes the
“closing” of the transaction which makes a Change of Control/Restructuring Event
effective if the Change of Control/Restructuring Event is made effective through
a transaction which has a “closing” or (ii) a Change of Control/Restructuring
Event is reported in accordance with applicable law as effective to the
Securities and Exchange Commission if the Change of Control/Restructuring Event
is made effective other than through a transaction which has a “closing.”

 

C.                                    As used herein, a “Change of
Control/Restructuring Event” shall mean (i) the acquisition by any person or
entity, or two or more persons and/or entities acting in concert, of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934), of outstanding shares of
voting stock of the Company at any time if after giving effect to such
acquisition, and as a result of such acquisition, such person(s) or entity(ies)
own more than fifty percent (50%) of such outstanding voting stock, (ii) the
sale in one or more transactions of substantially all of the Company’s assets to
any person or entity, or two or more persons and/or entities acting in concert,
or (iii) the merger, consolidation or similar transaction resulting

 

7

--------------------------------------------------------------------------------

 

in a reduction of the interest in the Company’s stock of the pre-transaction
stockholders to less than fifty percent (50%) of the post-transaction ownership.
To the extent the Employee’s employment agreement conflicts with the Change of
Control/Restructuring Event definition set forth in the immediately preceding
sentence, the Employee’s employment agreement will govern.

 

D.                                    As used herein, the term “Confidential
Information” shall mean all information relating to Company, including any of
its subsidiaries, customers, vendors, and affiliates, of any kind whatsoever;
know-how; experience; expertise; business plans; ways of doing business;
business results or prospects; financial books, data and plans; pricing;
supplier information and agreements; investor or lender data and information;
business processes (whether or not the subject of a patent), computer software
and specifications therefore; leases; and any and all agreements entered into by
Company or its affiliates and any information contained therein; database mining
and marketing; customer relationship management programs; any technical,
operating, design, economic, client, customer, consultant, consumer or collector
related data and information, marketing strategies or initiatives and plans
which at the time or times concerned is either capable of protection as a trade
secret or is considered to be of a confidential nature regardless of form.
Confidential Information shall not include: (i) information that is or becomes
generally available to the public other than as a result of a disclosure in
breach of this Agreement, (ii) information that was available on a
non-confidential basis prior to the date hereof or becomes available from a
person other than the Company who was not otherwise bound by confidentiality
obligations to the Company and was not otherwise prohibited from disclosing the
information or (iii) Confidential Information that is required by law to be
disclosed, in which case, Employee will provide the Company with notice of such
obligation immediately to allow the Company to seek such intervention as it may
deem appropriate to prevent such disclosure including and not limited to
initiating legal or administrative proceedings prior to disclosure.

 

E.                                     As used herein, the term “Disability”
shall mean a physical or mental impairment which, as reasonably determined by
the Board of Directors, renders the Employee unable to perform the essential
functions of his employment with the Company, even with reasonable accommodation
that does not impose an undue hardship on the Company, for more than one hundred
and eighty (180) days in any twelve (12) month period, unless a longer period is
required by federal or state law, in which case that longer period would apply.

 

F.                                      As used herein, the term “Retirement”
shall mean termination (other than by reason of death or Disability) of the
Employee’s employment with the Company or one of its subsidiaries pursuant to
and in accordance with a plan or program of the Company or subsidiary applicable
to the Employee provided, however, that for purposes of this Agreement only, the
Employee must have attained the age of

 

8

--------------------------------------------------------------------------------

 

sixty (60) and been an employee of the Company for not less than three (3) years
as of the date of termination of employment by reason of Retirement.

 

11.                               AMENDMENT

 

In the event that the Board of Directors shall amend the 2009 Plan under the
provisions of Section 9 of the 2009 Plan and such amendment shall modify or
otherwise affect the subject matter of this Agreement, this Agreement shall, to
that extent, be deemed to be amended by such amendment to the 2009 Plan. The
Company shall notify the Employee in writing of any such amendment to the 2009
Plan and this Agreement as soon as practicable after its approval.
Notwithstanding any other provision of this Agreement or the 2009 Plan, the
Employee’s Options under this Agreement may not be amended in a way that
materially diminishes the value of the Options without the Employee’s consent to
the amendment.

 

12.                               CONSTRUCTION

 

In the event of any conflict between the 2009 Plan and this Agreement, the
provisions of the 2009 Plan shall control.  This Agreement shall be governed in
all respects by the laws of the State of Georgia.  No provision of this
Agreement shall limit in any way whatsoever any right that the Company may
otherwise have to terminate the employment of the Employee at any time.

 

If any provision of this Agreement is held to be unenforceable, then this
provision will be deemed amended to the extent necessary to render the otherwise
unenforceable provision, and the rest of the Agreement, valid and enforceable.
If a court declines to amend this Agreement as provided herein, the invalidity
or unenforceability of any particular provision thereof shall not affect the
other provisions hereof, and this Agreement shall be construed in all respects
as if such invalid or unenforceable provision had been omitted.

 

13.                               ENTIRE AGREEMENT

 

This Agreement constitutes the entire agreement between the Company and the
Employee and supersedes all other discussions, correspondence, representations,
understandings and agreements between the parties, with respect to the subject
matter hereof.

 

14.                               HEADINGS

 

The headings of the sections of this Agreement are inserted for convenience only
and shall not be deemed a part hereof.

 

15.                               CONFIRMING INFORMATION

 

By accepting this Agreement, either through electronic means or by providing a
signed copy, the Employee (i) acknowledges and confirms that the Employee has
read and understood the 2009 Plan and the Agreement and (ii) acknowledges that
acceptance through electronic means is equivalent to doing so by providing a
signed copy.

 

9

--------------------------------------------------------------------------------

 

16.                               WAIVER AND RELEASE BY EMPLOYEE

 

AS A CONDITION PRECEDENT TO AND IN CONSIDERATION FOR THE COMPANY MAKING THIS
AWARD, THE EMPLOYEE IRREVOCABLY WAIVES AND FOREVER RELEASES ANY AND ALL EXISTING
CLAIMS TO ANY EQUITY-BASED COMPENSATION (INCLUDING ANY EQUITY APPRECIATION
AWARDS, RIGHTS OR OPTIONS) ALLOCATED, ASSIGNED OR OTHERWISE ATTRIBUTED TO THE
EMPLOYEE PRIOR TO THE GRANT DATE PURPORTING TO GIVE THE EMPLOYEE THE RIGHT TO
BENEFIT FROM OR PARTICIPATE IN THE APPRECIATION OR INCREASE IN VALUE OF, OR
PROFITS OR DIVIDENDS FROM, ANY DIVISION, BUSINESS UNIT OR OTHER SUB-DIVISION OF
THE COMPANY OR ANY SUBSIDIARY OF ALTISOURCE, INCLUDING WITHOUT LIMITATION, ANY
PLAN TITLED OR STRUCTURED AS A DIVISION EQUITY APPRECIATION RIGHTS PLAN,
BUSINESS UNIT EQUITY APPRECIATION RIGHTS PLAN, SHADOW STOCK PLAN, OR PROFIT
SHARING PLAN. FOR PURPOSES OF CLARIFICATION, THE FOREGOING WAIVER AND RELEASE
SHALL NOT APPLY TO ANY STOCK OPTION OR RESTRICTED STOCK AWARD FOR ALTISOURCE
COMMON STOCK ISSUED PURSUANT TO THE 2009 PLAN, INCLUDING ANY RIGHTS IN STOCK OF
OTHER COMPANIES RESULTING THEREFROM.

 

[SIGNATURE PAGE FOLLOWS]

 

10

--------------------------------------------------------------------------------

 

I hereby agree to and accept the terms of this Agreement.

 

 

 

Employee

 

 

 

 

 

Signature

 

 

 

 

 

Altisource Portfolio Solutions S.A.

 

 

 

 

 

By:

 

 

Name:

 

Title:

 

 

 

Attested by:

 

 

Name:

 

 

11

--------------------------------------------------------------------------------