Exhibit 10.6.16

 

PHH CORPORATION

 

2011 PERFORMANCE RESTRICTED STOCK UNIT

AWARD NOTICE

 

We are pleased to notify you that PHH Corporation (the “Company”) has awarded you this 2011 Performance Restricted Stock Unit Award.  The Performance Restricted Stock Unit Award represents the Company’s unfunded and unsecured promise to issue shares of the Company’s Stock at a future date subject to the terms and conditions of this Performance Restricted Stock Unit Award Notice, the attached Performance Restricted Stock Unit Award Agreement (the “Agreement”) and the PHH Corporation 2005 Equity and Incentive Plan, as amended (the “Plan”).  This Performance Restricted Stock Unit Award Notice (the “Award Notice”) constitutes part of and is subject to the terms and provisions of the Agreement and the Plan.  Capitalized terms used but not defined in this Award Notice shall have the meanings set forth in the Agreement or the Plan.

 

	
Grantee:
    	
[Name]
    
	
 
    	
 
    
	
Participant   #:
    	
[ID]
    
	
 
    	
 
    
	
Grant   Date:
    	
____________, 2011
    
	
 
    	
 
    
	
Target   Shares:
    	
[_________]
    
	
 
    	
 
    
	
Earned   Shares:
    	
The Earned Shares are   the shares of Stock determined by multiplying the Target Shares by the   Achieved Percentage based on the Target Performance Level achieved by the   Company for the Target Measurement Period as described in the chart below,   and as determined by the Human Capital and Compensation Committee (the   “Committee”) in its discretion.
    
	
 
    	
 
    
	
Settlement:
    	
Subject to the terms of   the Agreement and the Plan, the Earned Shares will be paid on or after   January 1, 2014, and on or before April 30, 2014 (the date of payment is   referred to herein as the “Settlement Date”).    Except as provided in the Award Agreement, failure to achieve any   Targeted Performance Level during the Target Measurement Period shall result   in the forfeiture of your rights under this Award and termination of the   Agreement.
    
	
 
    	
 
    
	
Target Measurement Period   (“TMP”) – October 1,  2011 through   December 31, 2013
    


 

[continued on the next page]

 











 

Targeted Performance Levels

 

	
Targeted   Performance
   Level
    	
 
    	
Cumulative   Core Earnings
   (Pre-Tax) for the TMP1
    	
 
    	
Achieved
   Percentage
    	
 
    
	
Threshold 
    	
 
    	
At least $[***] but   less than $[***]
    	
 
    	
50%
    	
 
    
	
Target
    	
 
    	
At least $[***] but   less than $[***]
    	
 
    	
100%
    	
 
    
	
Outstanding 
    	
 
    	
At least $[***]
    	
 
    	
150%
    	
 
    


 

1The target levels of cumulative Core Earnings (Pre-Tax) will be reduced by the actual level of Core Earnings (Pre-Tax) achieved for the 2011 fiscal year through September 30, 2011.

 

The Achieved Percentage for a level of achievement of the cumulative Core Earnings (Pre-Tax) target as certified by the Committee that is between the levels set forth in the table above and is above the “Threshold” level will be determined based on straight-line interpolation.  There will be no payment for performance below the “Threshold” level.  No payment will be made in excess of the Achieved Percentage at the “Outstanding” level.

 

For purposes of this Award, “Core Earnings (Pre-Tax)” means pre-tax income after non-controlling interest for the Company and its consolidated subsidiaries excluding unrealized changes in fair value of the mortgage servicing rights of the Company and its consolidated subsidiaries that are based upon projections of expected future cash flows and prepayments as well as realized and unrealized changes in the fair value of derivatives that are intended to offset changes in the fair value of mortgage servicing rights.

 

The Committee may exercise negative discretion to reduce the Achieved Percentage and the amount payable under this Award prior to the earlier of payment of the Award or Change in Control.  Such discretion may be exercised based on the Committee’s subjective determination (or the Committee’s determination based upon a recommendation of the Company’s management) of the extent to which the Grantee has achieved such individual goals for the Measurement Period, if any, as the Committee may establish or based on any other factors the Committee deems necessary or appropriate in its sole and absolute discretion.

 

We congratulate you on the recognition of your importance to our organization and its future.

 

	
 
    	
PHH CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Name: Jerome J. Selitto
    
	
 
    	
Title:  President & CEO, PHH Corporation
    
	
 
    	
Date:  ____________, 2011
    


 

RETAIN THIS NOTIFICATION AND YOUR AWARD AGREEMENT WITH

YOUR IMPORTANT DOCUMENTS AS A RECORD OF THIS AWARD.

 

__________________________

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

 

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PHH CORPORATION

PERFORMANCE RESTRICTED STOCK UNIT AWARD AGREEMENT

 

PHH Corporation, a Maryland corporation (the “Company”) has granted to the individual (the “Grantee”) named in the Performance Restricted Stock Unit Award Notice to which this Performance Restricted Stock Unit Award Agreement (the “Agreement”) is attached, a Performance Restricted Stock Unit Award relating to the common stock, par value $0.01 per share, of the Company, subject to the terms and conditions set forth in the Award Notice and this Agreement.  This Performance Restricted Stock Unit Award (the “Award”) has been granted pursuant to the PHH Corporation Amended and Restated 2005 Equity and Incentive Plan, as amended (the “Plan”).

 

WHEREAS, the Human Capital and Compensation Committee of the Board of Directors of the Company (the “Committee”) has the authority under and pursuant to the Plan to grant and establish the terms of awards to eligible employees of the Company and its Subsidiaries; and

 

WHEREAS, the Committee desires to grant an Award to the Grantee, subject to the terms and conditions of the Plan, the Award Notice and this Agreement.

 

In consideration of the provisions contained in this Agreement, the Company and the Grantee agree as follows:

 

1.                                    The Plan.  The Award granted to the Grantee hereunder is pursuant to the Plan.  The terms of the Plan are hereby incorporated in this Agreement.  Terms used in this Agreement which are not defined in this Agreement shall have the meanings used or defined in the Plan.

 

2.                                    Grant of Award.

 

a.                                     Subject to the terms and conditions set forth in the Plan and this Agreement, the Grantee is hereby granted this Award.

 

b.                                    The Grantee is not required to make any monetary payment (other than applicable tax withholding, if any, and payment of the par value of the Stock, if required by law) as a condition to receiving shares of Stock issued upon settlement of the Award.

 

c.                                     If the Grantee does not sign a restrictive covenant agreement in the form presented by the Company within forty-five (45) days after the Grant Date, the Award shall be forfeited.

 

3.                                    Termination of Employment.  Notwithstanding any other provision of the Plan to the contrary, except as provided in Section 4b. and 4c., upon the termination of the Grantee’s employment with the Company and its Subsidiaries for any reason whatsoever on or before December 31, 2013, the Award shall immediately and automatically terminate and no payment will be made.

 











 

4.                                    Settlement.

 

a.                                     Issuance of Shares of Stock.  On the Settlement Date, the Company shall issue to the Grantee the Earned Shares, as described in the Award Notice, after any adjustments as provided under Section 5 of the Plan; provided, however, that the Grantee shall remain required to remit to the Company such amount that the Company determines is necessary to meet all required minimum withholding taxes.

 

b.                                    If the Grantee’s employment is terminated by the Company and its Subsidiaries without Cause (as defined in this subsection b.), the Award shall become vested in accordance with the following schedule:

 

	
Date of   Termination of
   Employment Without Cause
    	
 
    	
Percent   Vested
    
	
Before January 1, 2012
    	
 
    	
0%
    
	
On or after January 1,   2012, but before January 1, 2013
    	
 
    	
25%
    
	
On or after January 1,   2013, but before December 31, 2013
    	
 
    	
50%
    
	
December 31, 2013
    	
 
    	
100%
    


 

The portion of the Award payable on the Settlement Date will be the number of Earned Shares multiplied by the percent vested from the above chart.  All other Earned Shares will be forfeited as of the Settlement Date, except as otherwise expressly provided by the Committee.  Notwithstanding the foregoing, in the event the Grantee violates any non-competition, non-solicitation, non-disclosure, or other restrictive covenant agreement with the Company or its Subsidiaries  prior to the Settlement Date, then the Grantee shall not be vested in any portion of the Earned Shares and the entire Award will be forfeited.

 

For purposes of this Award, “Cause” means any one of the following: (1) a material failure of the Grantee to substantially perform the Grantee’s duties with the Company or its Subsidiaries (other than failure resulting from incapacity due to physical or mental illness); (2) any act of fraud, misappropriation, dishonesty, embezzlement or similar conduct against, or relating to the assets of, the Company or its Subsidiaries; (3) conviction (or plea of nolo contendere) of a felony or any crime involving moral turpitude; (4) repeated instances of negligence in the performance of the Grantee’s job or any instance of gross negligence in the performance of the Grantee’s duties as an employee of the Company or one of its Subsidiaries; (5) any breach by the Grantee of any fiduciary obligation owed to the Company or any Subsidiary or any material element of the Company’s Code of Ethics, the Company’s Code of Conduct or other applicable workplace policies; or (6) failure by the Grantee to perform Grantee’s job duties for the Company or any Subsidiary to the best of Grantee’s ability and in accordance with reasonable instructions and directions from the Board or its designee, and the reasonable workplace policies and procedures established by the Company or any Subsidiary, as applicable, from time to time.

 

c.                                     Change in Control.  Upon the occurrence of a Change in Control that occurs on or before December 31, 2013 and while the Grantee is employed with the Company or its subsidiaries, the Grantee will become vested in the portion of the Change in Control Payment as specified in the chart below:

 

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Date of   Change in Control
    	
 
    	
Percent   Vested
    
	
Before January 1, 2012
    	
 
    	
0%
    
	
On or after January 1,   2012, but before January 1, 2013
    	
 
    	
25%
    
	
On or after January 1,   2013, but before December 31, 2013
    	
 
    	
50%
    
	
December 31, 2013
    	
 
    	
100%
    


 

For this purpose, the “Change in Control Payment” is the level of Core Earnings (Pre-Tax) achieved as of the date of the Change in Control expressed as a percentage of Threshold Performance, multiplied by the Target Shares.  For this purpose, “Threshold Performance” is $[***] minus the actual level of Core Earnings (Pre-Tax) achieved for the 2011 fiscal year through September 30, 2011.  The vested portion of the Change in Control Payment will be paid on a date selected by the Company within ninety (90) days following the date of the Change in Control.  The unvested portion of the Change in Control Payment shall be forfeited upon payment of the vested portion, unless otherwise expressly provided by the Committee in writing.

 

d.                                    Certificate Registration.  The certificate for the shares issued in settlement of the Award shall be registered in the name of the Grantee, or, if applicable, in the names of the Grantee’s heirs.

 

e.                                     Restrictions on Grant of the Award and Issuance of Shares.  The grant of this Award and issuance of shares of Stock upon settlement of the Award shall be subject to and in compliance with all applicable requirements of federal, state or foreign law with respect to such securities.  No shares of Stock may be issued hereunder if the issuance of such shares would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed.  The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance of any shares subject to the Award shall relieve the Company of any liability in respect of the failure to issue such shares as to which such requisite authority shall not have been obtained.  As a condition to the settlement of the Award, the Company may require the Grantee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

 

f.                                        Fractional Shares.  The Company shall not be required to issue fractional shares upon the settlement of the Award.

 

g.                                     Dividend Equivalents.  No dividend equivalents will be paid with respect to the Award.

 

5.                                    Tax Obligations.  As a condition to the granting of the Award and the settlement thereof, the Grantee agrees to remit to the Company or any of its applicable Subsidiaries such sum as may be necessary to discharge the Company’s or such Subsidiary’s obligations with respect to any tax, assessment or other governmental charge imposed on property or income received by the Grantee pursuant to this Agreement and the Award.  Accordingly, the Grantee agrees to remit to

_______________________

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

 

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the Company or an applicable Subsidiary any and all required minimum withholding taxes.  To satisfy such obligation, Grantee agrees to have the Company withhold a number of whole shares of Stock otherwise deliverable to Grantee in settlement of the Award having a Fair Market Value, as of the date on which the tax withholding obligations arise, not in excess of the amount of such tax withholding obligations determined by the applicable minimum statutory withholding rates.

 

6.                                    No Rights to Continued Employment; Loss of Office.  Neither this Agreement nor the Award shall be construed as giving the Grantee any right to continue in the employ of the Company or any of its Subsidiaries, or shall interfere in any way with the right of the Company to terminate such employment.  Notwithstanding any other provision of the Plan, the Award, this Agreement or any other agreement (written or oral) to the contrary, for purposes of the Plan and the Award, a termination of employment shall be deemed to have occurred on the date upon which the Grantee ceases to perform active employment duties for the Company following the provision of any notification of termination or resignation from employment, and without regard to any period of notice of termination of employment (whether expressed or implied) or any period of severance or salary continuation.  Notwithstanding any other provision of the Plan, the Award, this Agreement or any other agreement (written or oral) to the contrary, the Grantee shall not be entitled (and by accepting an Award, thereby irrevocably waives any such entitlement), by way of compensation for loss of office or otherwise, to any sum or other benefit to compensate the Grantee for the loss of any rights under the Plan as a result of the termination or expiration of an Award in connection with any termination of employment.  No amounts earned pursuant to the Plan or any Award shall be deemed to be eligible compensation in respect of any other plan of the Company or any of its Subsidiaries.

 

7.                                    Rights as a Stockholder.  The Grantee shall have no rights as a stockholder with respect to any shares which may be issued in settlement of the Award until the date of the issuance of a certificate for such shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company).  No adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date such certificate is issued, except as provided Section 5 of the Plan.

 

8.                                    Clawback.  This Award, and any stock issued or cash paid pursuant to this Award, is expressly subject to any “clawback policy” adopted by the Board or its designee.

 

9.                                    Legends. The Company may at any time place legends referencing any applicable federal, state or foreign securities law restrictions on all certificates representing shares of Stock issued pursuant to this Agreement.  The Grantee shall, at the request of the Company, promptly present to the Company any and all certificates representing shares acquired pursuant to this Agreement in the possession of the Grantee in order to carry out the provisions of this Section.

 

10.                            Nontransferability.  Prior to the issuance of shares of Stock pursuant to this Agreement, neither this Agreement nor any shares subject to this Agreement shall be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Grantee, except transfer by will or by the laws of descent and distribution.  All rights with respect to the Agreement shall be exercisable during the Grantee’s lifetime only by the Grantee or the Grantee’s guardian or legal representative.

 

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11.                            Amendments.  The Committee may amend this Agreement at any time; provided, however, that no such amendment may adversely affect the Grantee’s rights under this Agreement without the consent of the Grantee, except to the extent such amendment is reasonably determined by the Committee in its sole discretion to be necessary to comply with applicable law or to prevent a detrimental accounting impact.  No amendment or addition to this Agreement shall be effective unless in writing.

 

12.                            Section 409A.  This Award is intended to comply with, or otherwise be exempt from, Section 409A of the Code.  This Award shall be administered, interpreted and construed in a manner consistent with such Code section.  Should any provision of this Agreement or the Award be found not to comply with, or otherwise be exempt from, the provisions of Section 409A of the Code, it shall be modified and given effect, in the sole discretion of the Committee and without requiring the Grantee’s consent (notwithstanding the provisions of Section 10 above), in such manner as the Committee determines to be necessary or appropriate to comply with, or to effectuate an exemption from, Section 409A of the Code.

 

13.                            Notices.  Any notice required or permitted under this Agreement shall be deemed given when delivered personally, or when deposited in a United States Post Office, postage prepaid, addressed, as appropriate, to the Grantee at the last address specified in the Grantee’s employment records, or such other address as the Grantee may designate in writing to the Company, or the Company, Attention: General Counsel, or such other address as the Company may designate in writing to the Grantee.

 

14.                            Binding Effect.  This Agreement shall inure to the benefit of the successors and assigns of the Company and, subject to the restrictions on transfer set forth herein, be binding upon the Grantee and the Grantee’s heirs, executors, administrators, successors and assigns.

 

15.                            Failure to Enforce Not a Waiver.  The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

 

16.                            Integrated Agreement.  The Award Notice, this Agreement and the Plan constitute the entire understanding and agreement of the Grantee and the Company with respect to the subject matter contained herein or therein and supersedes any prior agreements, understandings, restrictions, representations, or warranties among the Grantee and the Company with respect to such subject matter other than those as set forth or provided for herein or therein.  To the extent contemplated herein or therein, the provisions of the Award Notice and the Agreement shall survive any settlement of the award and shall remain in full force and effect.

 

17.                            Governing Law.  This Agreement and the legal relations between the parties shall be governed by and construed in accordance with the internal laws of the State of Maryland, without effect to the conflicts of laws principles thereof.

 

18.                            Authority.  The Committee shall have full authority to interpret and construe the terms of the Plan, the Award Notice, and this Agreement.  The determination of the Committee as to any such matter of interpretation or construction shall be final, binding and conclusive on all parties.

 

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