Exhibit 10.20


 


NONQUALIFIED STOCK OPTION
AGREEMENT


 


              
    , 2010


 


Re:                               Prommis Solutions Holding Corp. (the “Company”)
Grant of Nonqualified Stock Option


 


To the Participant Identified on the Signature Page attached
hereto:


 


The Company is pleased to advise you that you have
been granted a stock option (an “Option”), as provided below, under the
Third Amended and Restated Prommis Solutions Holding Corp. 2006 Stock Option
Plan (the “Plan”), a copy of which is attached hereto and incorporated
herein by reference.  Certain terms used
herein are defined in Section 16 hereof.


 


1.                                       Option.


 


(a)                                  Terms.  Your Option
is for the purchase of up to the number of Common Shares written next to your
name on the signature page attached hereto (the “Option Shares”) at
the price per Common Share written next to your name on the signature page (the
“Exercise Price”), payable upon exercise as set forth in Section 1(b) below.  Your Option shall expire at the close of
business on the date that is ten (10) years from the date hereof (or if
earlier, as set forth in Section 2(d) below (such earlier date
the “Expiration Date”)), subject to earlier expiration as provided in Section 3(b) below.  Your Option is not intended to be an “incentive
stock option” within the meaning of Section 422 of the Code.


 


(b)                                 Payment of Option Price. 
Subject to Sections 2 and 3 below, your Option may be
exercised in whole or in part upon payment of an amount (the “Option Price”)
equal to the Exercise Price multiplied by the number of Option Shares to be
acquired.  Payment of the Option Price
shall be made in cash (including by check, bank draft, money order or wire
transfer).


 


2.                                       Exercisability/Vesting.


 


(a)                                  Normal Vesting. 
Your Option may be exercised only to the extent it has become vested in accordance
with this Section 2.  The
number of Option Shares with respect to which your Option may be exercised
shall not increase once you cease to be employed by the Company and its
Subsidiaries.


 


(b)                                 Time Vesting. 
Fifty percent (50%) of your Option (the “Time Vesting Tranche”)
shall become vested in annual one-quarter (1/4) increments (i.e. 12.5% of your
Option shall vest on each anniversary of
            
    , 2010 (the “Vesting Start Date”) up to and
including the fourth anniversary of the Vesting Start Date), if as of each
anniversary of the Vesting Start Date you are still employed by the Company or
any of its Subsidiaries.  The Time
Vesting Tranche will be deemed to have commenced vesting as of the one year anniversary
of the


 

















 


Vesting Start Date (i.e. as of
          
    , 2011, 1/4 of the Time Vesting Tranche shall have
vested).  The effective date of vesting
shall be each anniversary of the Vesting Start Date.  If you cease to be employed by the Company
and its Subsidiaries on any date other than an anniversary of the Vesting Start
Date, the percentage of the Time Vesting Tranche that is vested shall equal the
percentage of the Time Vesting Tranche which was vested as of the immediately
preceding anniversary of the Vesting Start Date.


 


(c)                                  Performance Vesting. 
Fifty percent (50%) of your Option shall become vested in accordance
with performance vesting criterion to be established by the Board (the “Performance
Vesting Tranche”).  Any portion
of the Performance Vesting Tranche that is eligible for vesting in any
particular period that does not vest will be forfeited and returned to the
Company and will not be eligible for performance vesting in any subsequent
period.


 


(d)                                 Acceleration of Vesting on Sale of the
Company.  Immediately prior to a Sale of the Company or
the termination of your Option pursuant to Section 6.2 of the Plan, your
Option shall immediately vest and become exercisable with respect to one
hundred percent (100%) of the then unvested Option Shares, if, and only so long
as, you are employed by the Company and its Subsidiaries as of such date and
you exercise your Option in accordance with the procedures set forth in Section 4
below prior to or in connection with such Sale of the Company or termination of
your Option.  Any portion of your Option
not so exercised shall expire and become forfeited immediately prior to the
consummation of such Sale of the Company.


 


3.                                       Expiration of Option.


 


(a)                                  Normal Expiration. 
In no event shall any part of your Option be exercisable after the Expiration
Date set forth in Section 1(a) above.


 


(b)                                 Early Expiration Upon Termination of
Employment.  If your employment with the Company or any of
its Subsidiaries terminates, (x) any portion of your Option that was not
vested and exercisable on your Date of Termination shall expire and be
forfeited as of such date, and (y) any portion of your Option that was
vested and exercisable on your Date of Termination shall expire and be
forfeited as of such date, except that: (i) if your employment terminates
because you die or become subject to any Disability, your Option shall expire
six months after your Date of Termination, but in no event after the Expiration
Date, (ii) if your employment terminates because you retire (with the
approval of the Committee), your Option shall expire thirty (30) days after
your Date of Termination, but in no event after the Expiration Date, and (iii) if
you are discharged by the Company or its Subsidiaries other than for Cause or
are discharged as a result of voluntary termination, your Option shall expire
thirty (30) days after your Date of Termination, but in no event after the
Expiration Date.


 


4.                                       Procedure for Exercise. 
You may exercise all or any portion of your Option, to the extent it has
vested and is outstanding, at any time and from time to time prior to its
expiration, by delivering written notice to the Company (to the attention of
the Company’s Secretary) and your written acknowledgment that you have read and
have been afforded an opportunity to ask questions of management of the Company
or management’s designee, including, but not limited to, the Board or an
officer of the Company designated by the Board,


 


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regarding all financial
and other information provided to you regarding the Company, together with
payment of the Option Price in accordance with the provisions of Section 1(b) above.  As a condition to any exercise of your
Option, you shall permit the Company to deliver to you all financial and other
information regarding the Company that the Company believes necessary to enable
you to make an informed investment decision, and you shall make all customary
investment representations which the Company requires.  Within 30 days after acquiring Option Shares
upon exercising your Option, you agree that you will make an effective election
with the Internal Revenue Service under Section 83(b) of the Code in
form and substance reasonably acceptable to the Company.


 


5.                                       Securities Laws Restrictions and Other
Restrictions on Transfer of Option Shares.  You represent
that when you exercise your Option you shall be purchasing Option Shares for
your own account and not on behalf of others. 
You understand and acknowledge that federal and state securities laws
govern and restrict your right to offer, sell, or otherwise dispose of any
Option Shares unless your offer, sale, or other disposition thereof is
registered under the Act and state securities laws, or in the opinion of the
Company’s counsel, such offer, sale, or other disposition is exempt from
registration or qualification thereunder. 
You agree that you shall not offer, sell, or otherwise dispose of any
Option Shares in any manner which would: (i) require the Company to file
any registration statement with the Securities and Exchange Commission (or any
similar filing under state law) or to amend or supplement any such filing, (ii) violate
or cause the Company to violate the Act, the rules and regulations
promulgated thereunder, or any other similar state or federal law or (iii) violate
the terms and conditions of this Agreement or the Plan.  You further understand that the certificates
for any Option Shares you purchase shall bear such legends as the Company deems
necessary or desirable in connection with the Act or other applicable rules,
regulations or laws.  You further
understand that, prior to the exercise of your Option, you will have an
opportunity to ask questions and receive answers concerning the terms of the
Option Shares, and will have the opportunity to review a copy of the Company’s
Certificate of Incorporation in effect at that time.


 


6.                                       Non-Transferability of Option. 
Your Option is personal to you and is not transferable by you other than
by will or the laws of descent and distribution.  During your lifetime only you (or your
guardian or legal representative) may exercise your Option.  In the event of your death, your Option may
be exercised only (i) by the executor or administrator of your estate or
the person or persons to whom your rights under the Option shall pass by will
or the laws of descent and distribution and (ii) to the extent that you
were entitled hereunder at the date of your death.


 


7.                                       Conformity with Plan. 
Your Option is intended to conform in all respects with, and is subject
to all applicable terms, conditions and provisions of, the Plan (which is
incorporated in its entirety herein by reference).  Inconsistencies between this Agreement and
the Plan shall be resolved in accordance with the terms of the Plan.  By executing and returning the enclosed copy
of this Agreement, you acknowledge your receipt of this Agreement and the Plan
and agree to be bound by all of the terms of this Agreement and the Plan.


 


8.                                       Rights of Participants. 
Nothing in this Agreement shall interfere with or limit in any way the
right of the Company or any of its
Subsidiaries to terminate your employment at any time (with or without
cause), nor confer upon you any right to continue in the employ of the


 


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Company or any of its
Subsidiaries for any period of time or to continue your present (or any other)
rate of compensation, and in the event of your termination of employment
(including, but not limited to, termination by the Company or any of its
Subsidiaries without cause) any portion of your Option that was not previously
exercised shall be forfeited in accordance with Section 3(b) above.  Nothing in this Agreement shall confer upon
you any right to be selected again as a Plan participant or to be selected as a
participant or beneficiary of any other Company or Subsidiary plan or program,
and nothing in the Plan or this Agreement shall provide for any adjustment to
the number of Option Shares subject to your Option upon the occurrence of
subsequent events except as provided in Section 10 below.


 


9.                                       Withholding of Taxes.


 


(a)                                  The Company or any of its Subsidiaries
shall be entitled, if necessary or desirable, to withhold, and you shall
indemnify the Company and its Subsidiaries, from any amounts due and payable by
the Company or any of its Subsidiaries to you (or secure payment from you in
lieu of withholding), the amount of any withholding or other tax due from the
Company or any of its Subsidiaries with respect to any Options.  The Company may defer the exercise of the
Option or the issuance of the Option Shares thereunder unless such taxes are
paid or the Company and its Subsidiaries is indemnified to their satisfaction.


 


(b)                                 Notwithstanding any provision of this
Agreement to the contrary, in connection with the transfer of this Option to a
transferee pursuant to Section 6 hereof, the transferee shall
remain liable for any taxes required to be withheld with respect to such
Option.


 


10.                                 Adjustments. 
In the event of a reorganization, recapitalization, stock dividend or
stock split, or combination or other change in the Common Shares, the Committee
shall, in order to prevent the dilution or enlargement of rights under your
Option, make such adjustments in the number and type of Common Shares covered
by your Option and the Exercise Price, in each case as may be determined by the
Committee to be appropriate and equitable.


 


11.                                 Right to Purchase Option Shares Upon
Termination of Employment.  Prior to a Public Offering or
a Sale of the Company, your Option Shares shall be subject to the Repurchase
Option set forth in this Section 11.


 


(a)                                  Repurchase of Option Shares on
Termination.  If your employment with the Company or its
Subsidiaries terminates for any reason, then the Company shall have the right,
but not the obligation, to repurchase all or any portion of your Option Shares
at a price per Option Share (the “Repurchase Price”) equal to, (i) if your
employment with the Company or its Subsidiaries is terminated for Cause , the
lesser of (A) the Fair Market Value of such Option Share as of the date of
the Repurchase Notice and (B) the Exercise Price of such Option Share, and
(ii) if your employment with the Company or its Subsidiaries is terminated
by the Company or its Subsidiaries other than for Cause or as a result of your
death or Disability or as a result of retirement or your voluntary resignation,
the Fair Market Value of such Option Share as of the date of the Repurchase
Notice.


 


(b)                                 Repurchase Procedure for the Company. 
If your employment with the Company or its Subsidiaries has terminated,
the Company may elect (the “Repurchase Option”)


 


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to repurchase all or any
portion of your Option Shares (the “Available Option Shares”) by
delivery of written notice (a “Repurchase Notice”) to you within 90 days
after your Date of Termination for any Option Shares issued 181 or more days
prior to the Date of Termination (or in the case of Option Shares issued 180 or
fewer days prior to the Date of Termination or any Option Shares issued at any
time after the Date of Termination upon exercise of this Option, no earlier
than 181 days and no later than 271 days after the date of the issuance of such
Option Shares) (the “Repurchase Notice Period”).  The Repurchase Notice shall set forth the
number of Option Shares to be acquired, the aggregate consideration to be paid
for such Option Shares, and the time and place for the closing of the
transaction.


 


(c)                                  Repurchase Procedure for the Investors. 
If for any reason the Company does not elect to purchase all of the
Available Option Shares, then the Investors shall be entitled to exercise the
Repurchase Option for all or any portion of the Available Option Shares that
were not repurchased by the Company pursuant to Section 11(b) above
(the “Remaining Option Shares”). 
As soon as practicable after the Company has determined that it will not
purchase all of the Available Option Shares, but in any event within 60 days
after the beginning of the Repurchase Notice Period corresponding to such
Available Option Shares, the Company shall give written notice (the “Option
Notice”) to each Investor setting forth the number of Remaining Option
Shares and the Repurchase Price for the Remaining Option Shares.  The Investors may elect to purchase all or
any portion of the Remaining Option Shares by giving written notice to the
Company within 60 days after the Option Notice has been delivered to the
Investors by the Company.  If the
Investors elect to purchase an aggregate amount of Remaining Option Shares in
excess of the amount of Remaining Option Shares specified in the Option Notice,
then the Remaining Option Shares shall be allocated among the Investors based
on the amount of Common Shares owned by each Investor on the date of the Option
Notice.  Any Investor may condition its
election to purchase such Remaining Option Shares on the election of one or
more other Investors to purchase Remaining Option Shares.  As soon as practicable, and in any event
within 10 days after the expiration of the 60 day period beginning on the date
the Option Notice is delivered to the Investors pursuant to this Section 11(c),
the Company shall deliver a Repurchase Notice to the holders of such Remaining
Option Shares setting forth the aggregate consideration to be paid by the
respective Investors for such Remaining Option Shares and the time and place
for the closing of the transaction.  At
the time the Company delivers such Repurchase Notice to the holders of such
Remaining Option Shares, the Company shall also deliver written notice to each
Investor setting forth the amount of Option Shares such Investor is entitled to
purchase, the aggregate consideration to be paid therefor, and the time and
place of the closing of the transaction.


 


(d)                                 Manner of Payment. 
If the Company elects to purchase all or any portion of such Option
Shares, including Option Shares held by one or more of your transferees, then,
within 12 months of the Date of Termination, the Company shall pay for such
Option Shares (i) by offsetting obligations owed by you or your transferee(s) to
the Company or to any Investor, (ii) with a subordinated promissory note
of the Company, which subordinated promissory note shall (x) bear interest
at the rate of 5% per annum (which shall be payable annually in cash unless
otherwise prohibited), (y) have all principal due on the second
anniversary of the date of issuance and (z) be subordinated on terms and
conditions satisfactory to the holders of the Company’s or its Subsidiaries’
indebtedness for borrowed money, (iii) at the Company’s option, by
certified check or wire transfer of funds or (iv) any combination of the


 


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foregoing.  If an Investor elects to purchase all or any
portion of the Remaining Option Shares, such Investor shall pay for such Option
Shares by certified check or wire transfer of funds within 12 months of the
Date of Termination.


 


12.                                 Restrictions on Transfer.


 


(a)                                  Transfer of Option Shares. 
The holders of Option Shares shall not sell, transfer, assign, pledge,
or otherwise dispose of (a “Transfer”) any interest in any Option
Shares, except pursuant to (i) a Public Offering, (ii) a Sale of the
Company, or (iii) the provisions of Section 12(b) hereof.


 


(b)                                 Certain Permitted Transfers. 
The restrictions set forth in this Section 12 shall not
apply with respect to any Transfer of Option Shares made (i) by will or
pursuant to applicable laws of descent and distribution, (ii) to such
Person’s legal guardian (in case of any mental incapacity) or (iii) among
such Person’s Family Group (each such Transfer, a “Permitted Transfer”);
provided that the restrictions contained in this Section 12
will continue to be applicable to the Option Shares after any Transfer of the
type referred to in this Section 12(b) and the transferees of
such Option Shares will agree in writing to be bound by the provisions of this
Agreement in order for such Transfer to constitute a Permitted Transfer.  Any transferee of Option Shares pursuant to a
Transfer in accordance with the provisions of this Section 12(b) is
herein referred to as a “Permitted Transferee.”  Three business days prior to the Transfer of
Option Shares pursuant to this Section 12(b), you will deliver a
written notice (a “Transfer Notice”) to the Company.  The Transfer Notice will disclose in reasonable
detail the identity of the proposed Permitted Transferee(s).


 


(c)                                  Termination of Restrictions. 
The restrictions set forth in this Section 12 will continue
with respect to each Option Share until the earlier of (i) the date on
which such Option Share has been transferred in a Public Offering in compliance
with the terms hereof or (ii) the consummation of a Sale of the Company.


 


13.                                 Additional Restrictions on Transfer.


 


(a)                                  Restrictive Legend. 
The certificates representing the Option Shares shall bear the following
legend:


 


“THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
ON [DATE OF OPTION EXERCISE], HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
OR UNDER ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD OR TRANSFERRED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE
STATE SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION THEREUNDER.  THE SECURITIES REPRESENTED BY THIS CERTIFICATE
ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE
PROVISIONS, AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN OPTION AGREEMENT
BETWEEN THE COMPANY AND PARTICIPANT DATED AS


 


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OF
              
    , 2010, A COPY OF WHICH MAY BE OBTAINED BY THE
HOLDER HEREOF AT THE COMPANY’S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.”


 


(b)                                 Opinion of Counsel. 
You may not sell, transfer or dispose of any Option Shares (except
pursuant to an effective registration statement under the Act) without first
delivering to the Company an opinion of counsel reasonably acceptable in form
and substance to the Company that registration under the Act or any applicable
state securities law is not required in connection with such transfer.


 


(c)                                  Holdback.  You agree not
to effect any public sale or distribution of any equity securities of the
Company, or any securities convertible into or exchangeable or exercisable for
such securities, during the seven days prior to and the 180 days after the
effectiveness of any underwritten offering of the Company’s equity securities
except as part of such underwritten registration if otherwise permitted.


 


14.                                 Sale of the Company.


 


(a)                                  If the holders of a majority of the
Common Shares then outstanding (the “Approving Holders”) approve a Sale
of the Company (the “Approved Sale”), you shall consent to and raise no
objections against the Approved Sale, and if the Approved Sale is structured as
a sale of stock, you shall vote for, consent to, raise no objection against,
and agree to sell your Common Shares and surrender any Options owned by you on
the terms and conditions approved by the Approving Holders, subject to the
provisions of Section 14(b). 
You shall take all necessary and desirable actions in connection with
the consummation of the Approved Sale.


 


(b)                                 Your obligations with respect to the
Approved Sale are subject to the satisfaction of the following conditions: (i) upon
the consummation of the Approved Sale, you shall receive the same amount of
consideration per Common Share as other holders of Common Shares; and (ii) if
you have currently exercisable or convertible rights to acquire Common Shares,
then you shall be given the opportunity to exercise such rights prior to the
consummation of the Approved Sale and participate in such sale as a holder of
Common Shares.


 


(c)                                  If the Board or the Approving Holders
enter into any negotiation or transaction for which Rule 506 (or any
similar rule then in effect) promulgated by the Securities and Exchange
Commission may be available with respect to such negotiation or transaction
(including a merger, consolidation, or other reorganization), you shall, at the
request of the Company, appoint a “purchaser representative” (as such term is
defined in Rule 501) reasonably acceptable to the Company.  If you appoint a purchaser representative
designated by the Company, then the Company shall pay the fees of such
purchaser representative.  However, if
you decline to appoint the purchaser representative designated by the Company,
then you shall appoint another purchaser representative (reasonably acceptable
to the Company), and you shall be responsible for the fees of the purchaser
representative so appointed.


 


(d)                                 You shall bear the pro-rata share (based
upon the aggregate consideration received in such sale) of the expenses
incurred by the Company’s stockholders in connection with such Approved Sale to
the extent not otherwise paid by the Company or the acquiring party


 


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and shall be obligated to join on a pro rata basis (based upon the
aggregate consideration received in such sale) in any purchase price
adjustments, indemnification or other obligations that the Approving Holders
agree to provide in connection with such Approved Sale (other than any such
obligations that relate specifically to a particular stockholder such as
indemnification with respect to representations and warranties given by a
stockholder regarding such stockholder’s title to and ownership of Common
Shares); provided that no holder shall be obligated in connection with such
Approved Sale to agree to indemnify or hold harmless the transferees, or be
liable for any purchase price adjustments or other obligations, with respect to
an amount in excess of the net cash proceeds paid to you in connection with
such Approved Sale.  Costs incurred by
the holders of Common Shares on their own behalf shall not be considered costs
of the transaction hereunder.  Any
portion of your Option which has not been exercised prior to or in connection
with the Sale of the Company shall be forfeited.


 


(e)                                  The provisions of this Section 14
shall terminate upon the consummation of a Public Offering.


 


15.                                 Remedies.  The parties
hereto (and the Investors as third-party beneficiaries hereof) shall be entitled
to enforce their respective rights under this Agreement specifically, to
recover damages by reason of any breach of any provision of this Agreement, and
to exercise all other rights existing in their favor.  The parties hereto acknowledge and agree that
money damages would not be an adequate remedy for any breach of the provisions
of this Agreement and that any party hereto (and the Investors as third-party
beneficiaries hereof) may, in their sole discretion, apply to any court of law
or equity of competent jurisdiction for specific performance and/or injunctive
relief (without posting bond or other security) in order to enforce or prevent
any violation of the provisions of this Agreement.


 


16.                                 Definitions. 
For the purposes of this Agreement, the following terms shall have the
meanings set forth below:


 


“Act” shall mean the Securities Act of 1933, as
amended, and any successor statute.


 


“Agreement” shall mean this nonqualified stock
option agreement.


 


“Affiliate” shall mean, with respect to any
Person, any other Person which, directly or indirectly, controls, is controlled
by or under common control with such Person.


 


“Board” shall mean the board of directors of
the Company.


 


“Cause” shall mean, with respect to you, (i) the
commission of a felony or a crime involving moral turpitude or the commission
of any other act or omission involving material dishonesty, material
disloyalty, or fraud with respect to the Company or any of its Subsidiaries or
any of their customers or suppliers, (ii) conduct the Company reasonably
believes could bring the Company or any of its Subsidiaries into public
disgrace or disrepute, (iii) failure (other than by reason of Disability),
after notice specifying such failure and an opportunity during a period of
fifteen (15) days to cure such failure, to carry out effectively your duties
and obligations to the Company or its Subsidiaries or to participate
effectively and actively in the management of the Company or its Subsidiaries,
as determined in the reasonable judgment of the chief executive officer or
president of the Company, its Subsidiaries or, in case of the chief executive
officer or


 


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president of the Company,
the Board, after written notice, (iv) gross negligence or willful misconduct
with respect to the Company or any Subsidiary, (v) any material breach of
this Agreement, or (vi) any material breach of your written employment
agreement, if any, with the Company or any Subsidiary; provided that, in
the event you are a party to a written employment agreement with the Company or
one of its Subsidiaries that contains a definition of “cause”, the definition
contained in such employment agreement shall control, including following the
expiration of such employment agreement.


 


“Code” shall mean the Internal Revenue Code of
1986, as amended, and any successor statute.


 


“Common Shares” shall mean the Company’s common
stock, par value $0.01 per share, and any other shares into which such stock
may be changed or converted by reason of a recapitalization, reorganization,
merger, consolidation, or any other change in the corporate structure or
capital stock of the Company.


 


“Company” shall mean Prommis Solutions Holding
Corp., a Delaware corporation.


 


“Date of Termination” shall mean (i) if
your employment is terminated by the Company or any Subsidiary, the effective
date of termination as specified in the written notice from the Company or such
Subsidiary to you terminating your employment, (ii) if you terminate your
employment, the date the Company or any Subsidiary receives notice from you
terminating your employment or (iii) if your employment is terminated
other than pursuant to (i) or (ii), then the date determined in good faith
by the Board.


 


“Disability” shall have the meaning assigned to
such term in any written employment agreement with the Company or any
Subsidiary or, in the absence of any such written employment agreement, shall
mean your inability, due to illness, accident, injury, physical or mental
incapacity or other disability, to carry out effectively your duties and
obligations to the Company or any of its Subsidiaries or, if applicable based
on your position, to participate effectively and actively in the management of
the Company or any of its Subsidiaries for a period of at least 90 consecutive
days or for shorter periods aggregating at least 120 days (whether or not
consecutive) during any twelve-month period, as determined in the reasonable
judgment of the Board.


 


“Fair Market Value” of the Common Shares shall
mean the fair market value of such stock, taking into account all relevant
factors determinative of value, as determined by the Board; provided,
however, that in the case of a Sale of the Company, the Fair Market Value of
the Common Stock shall be the price per Common Share in such transaction, as
determined by the Board.


 


“Family Group” shall mean, with respect to a
Person who is an individual, such Person’s spouse and descendants (whether
natural or adopted), and any trust, family limited partnership, limited liability
company or other entity wholly owned, directly or indirectly, by such Person or
such Person’s spouse and/or descendants that is and remains solely for the
benefit of such Person and/or such Person’s spouse and/or descendants and any
retirement plan for such Person.


 


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“Investors” shall mean Great Hill Equity
Partners II, L.P., a Delaware limited partnership, and Great Hill Equity
Partners III, L.P., a Delaware limited partnership.


 


“Option Shares” shall mean (i) all Common
Shares issued or issuable upon the exercise of the Option and (ii) all
Common Shares issued with respect to the Common Shares referred to in clause (i) above
by way of stock dividend or stock split or in connection with any conversion,
merger, consolidation or recapitalization or other reorganization affecting the
Common Shares.  Option Shares shall
continue to be Option Shares in the hands of any holder other than you (except
for the Company or the Investors and, to the extent that you are permitted to
transfer Option Shares pursuant to Sections 12 or 13 hereof,
purchasers pursuant to a Public Offering), and each such transferee thereof
shall succeed to the rights and obligations of a holder of Option Shares
hereunder.


 


“Person” means an individual, a partnership, a
corporation, a limited liability company, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.


 


“Public Offering” shall mean an initial public
offering and sale, registered under the Act, of equity securities of the
Company, as approved by the Board and the Investors.


 


“Sale of the Company” shall mean any
transaction or series of transactions pursuant to which any Person(s) or a
group of related Persons (other than the Investors and their Affiliates) in the
aggregate acquire(s) (i) at least 80% of the capital stock of the
Company or (ii) all or substantially all of the Company’s assets
determined on a consolidated basis; provided, that a Public Offering
shall not constitute a Sale of the Company.


 


“Subsidiary” means, with respect to any Person,
any corporation, limited liability company, partnership, association, or
business entity of which (i) if a corporation, a majority of the total
voting power of shares of capital stock entitled (without regard to the
occurrence of any event of default, breach, event of noncompliance or other
contingency) to vote in the election of directors thereof is at the time owned
or controlled, directly or indirectly, by that Person or one or more of the
other Subsidiaries of that Person or a combination thereof, or (ii) if a
limited liability company, the limited liability company, partnership,
association, or other business entity (other than a corporation), a majority of
partnership or other similar ownership interests thereof is at the time owned
or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof.  For purposes hereof, a Person or Persons
shall be deemed to have a majority ownership interest in a limited liability
company, partnership, association, or other business entity (other than a
corporation) if such Person or Persons shall be allocated a majority of limited
liability company, partnership, association, or other business entity gains or
losses or shall be or control any managing director or general partner of such
limited liability company, partnership, association, or other business entity.


 


17.                                 Code Section 409(A).


 


(a)                                  Code Section 409A. 
You hereby agree and acknowledge, neither the Company nor any of the
Company’s Affiliates makes any representations with respect to the application
of Code §409A to the Option or the Option Shares or any other tax, economic or


 


10

















 


legal consequences of the
Option or the Option Shares and, by the acceptance of the Option, you agree to
accept the potential application of Code §409A to the Option or the Option
Shares and the other tax, economic or legal consequences of the issuance,
vesting, ownership, modification, adjustment, exercising and disposition of the
Option or the Option Shares.  You agree
to hold harmless and indemnify the Company from any adverse tax consequences
with respect to the Option or the Option Shares, any withholding or other tax
obligations of the Company with respect to the Option or the Option Shares, and
from any action or inaction or omission of the Company pursuant to the Plan or
otherwise that may cause such Option or the Option Shares to be or become subject
to Code §409A.


 


(b)                                 Amendment.  The Company
agrees to cooperate with you to amend this Agreement to the extent you deem
necessary to avoid imposition of any additional tax or income recognition prior
to actual payment to you under Code section 409A and any temporary or final
Treasury Regulations and IRS guidance thereunder, but only to the extent such
amendment would not (and could not) have an adverse effect on the Company or
any of its Stockholders and would not provide you with any additional rights,
in each case as determined by the Company in its sole discretion.


 


18.                                 Amendment.  Except as
otherwise provided herein, any provision of this Agreement may be amended or
waived only with the prior written consent of you and the Company.


 


19.                                 Successors and Assigns. 
Except as otherwise expressly provided herein, all covenants and
agreements contained in this Agreement by or on behalf of any of the parties
hereto shall bind and inure to the benefit of the respective successors and
permitted assigns of the parties hereto whether so expressed or not.


 


20.                                 Severability. 
Whenever possible, each provision of this Agreement shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of this
Agreement.


 


21.                                 Counterparts. 
This Agreement may be executed simultaneously in two or more
counterparts (including by means of telecopied or electronically transcribed
signature pages), each of which shall constitute an original, but all of which
taken together shall constitute one and the same Agreement.


 


22.                                 Descriptive Headings. 
The descriptive headings of this Agreement are inserted for convenience
only and do not constitute a part of this Agreement.


 


23.                                 Governing Law. 
The corporate law of the State of Delaware shall govern all questions
concerning the relative rights of the Company and its stockholders.  All other questions concerning the
construction, validity and interpretation of this Agreement shall be governed
by the internal law, and not the law of conflicts, of the State of Delaware.


 


24.                                 Notices.  All notices,
demands, or other communications to be given or delivered under or by reason of
the provisions of this Agreement shall be in writing and shall be deemed to


 


11

















 


have been given when
delivered personally or mailed by certified or registered mail, return receipt
requested and postage prepaid, to the recipient.  Such notices, demands, and other
communications shall be sent to you, the Company and the Investors at the
addresses indicated on the Notices Schedule attached hereto or to such other
address or to the attention of such other person as the recipient party has
specified by prior written notice to the sending party.


 


25.                                 Third-Party Beneficiary. 
The Company and you acknowledge that each of the Investors is a third-party
beneficiary under this Agreement.


 


26.                                 Exemptions.  The Company
and you acknowledge and agree that this Agreement has been executed and
delivered, and the Option has been granted hereunder, in connection with and as
a part of the compensation and incentive arrangements between the Company and
you.  Each of the Options granted
hereunder and any issuance of Option Shares upon exercise of the Option is
intended to qualify for an exemption from the registration requirements under
the Act, pursuant to Rule 701 thereof (the “Federal Exemption”),
and under similar exemptions under applicable state securities laws.  In the event that any provision of the Plan
or this Agreement would cause the Option granted hereunder to not qualify for
the Exemption, you and the Company agree that his Agreement shall be deemed
automatically amended to the extent necessary to cause the Option to qualify
for the Federal Exemption.


 


27.                                 Entire Agreement. 
This Agreement and the Plan constitute the entire understanding between
you and the Company, and supersedes all other agreements, whether written or
oral, with respect to the subject matter hereof.


 


*       *       *       *


 


12

















 


Please execute the extra copy of this Agreement in the
space below and return it to the Company’s Chief Financial Officer at its
executive offices to confirm your understanding and acceptance of the
agreements contained in this Agreement.


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  Prommis Solutions
  Holding Corp.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Denis Brosnan

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  



 


 


	
  Enclosures:

  	
  1.

  	
  Extra copy of this
  Agreement

  
	
   

  	
  2.

  	
  Copy of the Plan

  



 


The undersigned hereby acknowledges having read this
Agreement and the Plan and hereby agrees to be bound by all provisions set forth
herein and in the Plan.


 


	
  Dated as of:                    
         , 2010

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
  Number of Option Shares        [      ]

  	
   

  
	
   

  	
  [Participant]

  
	
  Exercise Price                          $[      ]

  	
  [Address]

  
	
   

  	
  [Address]

  



 

















 


SPOUSAL CONSENT


 


The undersigned spouse of Participant hereby
acknowledges that I have read the foregoing Nonqualified Stock Option Agreement
and that I understand its contents.  I am
aware that the Agreement provides for the repurchase of my spouse’s Common
Shares under certain circumstances and imposes other restrictions on the
transfer of such Common Shares.  I agree
that my spouse’s interest in the Common Shares is subject to this Agreement and
any interest I may have in such Common Shares shall be irrevocably bound by
this Agreement and further that my community property interest, if any, shall
be similarly bound by this Agreement.


 


I am aware that the legal, financial, and other
matters contained in this Agreement are complex and I am free to seek advice
with respect thereto from independent counsel. 
I have either sought such advice or determined after carefully reviewing
this Agreement that I will waive such right.


 


	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Witness

  



 

















 


NOTICES SCHEDULE


 


	
  If to the Participant:

  	
  To the address set
  forth on the signature page hereto.

  
	
   

  	
   

  
	
  If to the Investors:

  	
  Great Hill Equity
  Partners II, L.P.

  Great Hill Equity
  Partners III, L.P. 

  One Liberty Square, 13th Floor 

  Boston, MA 02109

  Attention:    Matthew
  T. Vettel

  Facsimile:    (617)
  790-4901

  
	
   

  	
   

  
	
   

  	
  with a copy (which will
  not constitute notice to the Investors) to:

  
	
   

  	
   

  
	
   

  	
  Kirkland &
  Ellis LLP

  300 North LaSalle

  Chicago, Illinois 60654

  Attention:    Jeffrey
  Seifman, P.C.

  Michael D. Paley

  Facsimile:    (312)
  862-2200

  
	
   

  	
   

  
	
  If to the Company:

  	
  Prommis Solutions
  Holding Corp.

  1544 Old Alabama Road

  Roswell, Georgia 30076

  Attention:  Chief
  Executive Officer

  Facsimile:

  
	
   

  	
   

  
	
   

  	
  with a copy (which will
  not constitute notice to the Company) to:

  
	
   

  	
   

  
	
   

  	
  Great Hill Equity
  Partners II, L.P.

  Great Hill Equity
  Partners III, L.P.

  One Liberty Square, 13th Floor

  Boston, MA 02109

  Attention:    Matthew
  T. Vettel

  Facsimile:    (617)
  790-4901

  
	
   

  	
   

  
	
   

  	
  and:

  
	
   

  	
   

  
	
   

  	
  Kirkland &
  Ellis LLP

  300 North LaSalle

  Chicago, Illinois 60654

  Attention:    Jeffrey
  Seifman, P.C.

  Michael D. Paley

  Facsimile:    (312)
  862-2200