Document:

EX-10.1

 Exhibit 10.1 

EXECUTION VERSION 

AMENDMENT NO. 3 TO RESTRUCTURING SUPPORT AGREEMENT 

This Amendment No. 3 (this “Amendment No. 3”), dated as of November 2, 2016, is made by the HERO Entities and each of the Ad
Hoc Group Members that is a party hereto. Capitalized terms used and not otherwise defined herein have the meanings set forth in the Agreement (as defined below) or the Plan (as defined below), as applicable. 

WHEREAS, the HERO Entities and the Ad Hoc Group Members are parties to that certain Restructuring Support Agreement, dated May 26, 2016, as
amended by the Amendment to the Restructuring Support Agreement, dated July 8, 2016 and the Amendment No. 2 to Restructuring Support Agreement, dated August 12, 2016 (as may be further amended, modified or supplemented from time to time, the
“Agreement”); and 
 WHEREAS, Section 26 of the Agreement provides, among other things, that the Agreement may be amended
with the written consent of (i) each of the HERO Entities and (ii) the Requisite Consenting Lenders; provided, that notwithstanding the foregoing, any modifications, amendments, or supplements or waivers to the Agreement, including any
exhibits thereto (including any provision in the Term Sheet), to (a) the sub-provision entitled “First Lien Claims” in the provision entitled “Treatment of Claims and Interests” in the Term Sheet, (b) the sub-provisions entitled
“HERO Common Stock” in the provisions entitled “Treatment of Claims and Interests” in the Term Sheet, (c) any documentation with regard to (a) through (b) above may not be made without the prior written consent of the HERO
Entities and each member of the Ad Hoc Group; and 
 WHEREAS, on September 6, 2016, the Debtors, the Ad Hoc Group and the official committee
of equity security holders (the “Equity Committee”) participated in a mediation (the “Mediation”) held pursuant to an order of the Bankruptcy Court; and 

WHEREAS, in connection with the Mediation (as defined in the Plan (defined herein)), the Debtors and the Ad Hoc Group reached a settlement
(the “Mediation Settlement”) with respect to any and all claims and causes of action that may be asserted by the Debtors or on behalf of the Debtors’ estates against any holder of First Lien Claims pursuant to which the amount
of the Rejection Lender Wind Down Claim will be reduced by $32.5 million (the “First Lien Claim Reduction Amount”), and subject to and upon the occurrence of the Effective Date, the First Lien Claims will be subordinated in priority
of payment to the HERO Common Stock to the extent, and only to the extent, necessary to provide for payment of $15 million in cash to holders of HERO Common Stock on the Effective Date or as soon as reasonably practicable thereafter upon the Wind
Down Entity Board determining that through the proceeds of asset sales or the Claims reconciliation process, sufficient cash is available to fund the Wind Down Entity and make such distribution (the “Rejection Shareholder Cash
Distribution”); and 
 WHEREAS, the hearing to consider confirmation of the Debtors’ Modified Joint Prepackaged Chapter 11
Plan (Incorporating Mediation Settlement) filed in the Chapter 11 Cases on October 18, 2016 [Dkt. No. 436] (the “Plan”)1 commenced on September 22, 2016 and concluded September
27, 2016 (the “Confirmation Hearing”); and 
  

	1 	References to the “Plan” in the Restructuring Support Agreement and the Term Sheet shall refer to the “Plan” as defined in this Amendment No. 3. 

 EXECUTION VERSION 

 

 WHEREAS, the parties desire to amend the Agreement to (a) incorporate the terms of the
Mediation Settlement, (b) extend the deadlines for (i) entry of the Disclosure Statement Order and Confirmation Order and (ii) the consummation of the Plan and (c) incorporate certain other changes to the Plan that were agreed to during the
Confirmation Hearing. 
 NOW, THEREFORE, in consideration of the covenants and agreements contained herein and in the Agreement and for
other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged-the parties hereby agree as follows: 
  

	 	1.	Section 6(i) of the Agreement is hereby deleted in its entirety and replaced with the following: “obtain approval by the Bankruptcy Court of the Disclosure Statement and the Solicitation Procedures and entry of the
Confirmation Order on or before November 11, 2016, which Confirmation Order shall be a Final Order (as defined in the Term Sheet) on or before November 25, 2016.” 

 

	 	2.	Section 6(j) of the Agreement is hereby amended such that the reference to “October 14, 2016” therein is changed to “December 2, 2016.” 

 

	 	3.	The second paragraph of the “First Lien Claims” subsection of the “Treatment of Claims and Interests” section of the Term Sheet is hereby amended such that the reference to “$579 million”
therein is changed to “$546.5 million (after taking into account the First Lien Claim Reduction Amount pursuant to the Mediation Settlement)”. 

  

	 	4.	The second paragraph of the “HERO Common Stock” subsection of the “Treatment of Claims and Interests” section of the Term Sheet is hereby deleted in its entirety and replaced with the following:

 “If the class of HERO Common Stock votes to reject the Plan, each holder of HERO Common Stock shall receive its pro
rata share (calculated based on the total number of shares of HERO Common Stock) of (i) the Rejection Shareholder Cash Distribution and (ii) 100% of the Rejection Wind Down Entity Interests. For the avoidance of doubt, from and after the
Effective Date, any distribution on account of the Rejection Shareholder Cash Distribution shall be made prior to any distribution on account of the Rejection Lender Wind Down Claim. “Wind Down Entity Interests” shall refer to
whichever of the Acceptance Wind Down Entity Interests or the Rejection Wind Down Entity Interests arise based on the acceptance or rejection of the Plan by the class of HERO Common Stock.” 

 EXECUTION VERSION 

 

	 	5.	The section entitled “Disputed Claims Reserve” of the Term Sheet is hereby amended such that the reference to “Administrative Claims” in romanette (i) is deleted. 

 

	 	6.	The subsection entitled “Releases” of the “Release, Exculpation and Related Provisions” section of the Term Sheet is hereby deleted in its entirety and replaced with the following: 

“To the fullest extent permitted by applicable law, the Plan shall include a full mutual release from liability in favor of (a) the
Debtors, (b) the Wind Down Entity, (c) the non-Debtor subsidiaries, (d) the Ad Hoc Group and its members, (e) the First Lien Lenders that are parties to the Agreement, (f) each First Lien Lender that is a party to the Agreement, (g) the First Lien
Agent, (h) the First Lien Lenders, (i) each holder of HERO Common Stock that is also a First Lien Lender that is a party to the Agreement; and (j) with respect to each of the foregoing entities in clauses (a) through (i), such entity’s
respective current and former officers, directors, professionals, advisors, accountants, attorneys, investment bankers, consultants, employees, agents and other representatives, from any claims and causes of action related to or in connection with
the HERO Entities and their subsidiaries, arising on or prior to the Effective Date (collectively, the “Releases”); provided, however, that no party shall be released from any claim or cause of action that was a result
of such party’s gross negligence or willful misconduct as determined by a Final Order (as defined in the Plan).” 
  

	 	7.	The subsection entitled “9019 Settlement” of the “Release, Exculpation and Related Provisions” section of the Term Sheet is hereby amended (a) such that the reference to “the Debtors and their
estates” is replaced with “the Debtors, the Debtors’ estates and the Non-Debtor Subsidiaries” and (b) by the addition of the following clause at the end of such subsection: “including, for the avoidance of doubt, any claims
and causes of action settled pursuant to the Mediation Settlement and any objections, claims or causes of action asserted by the Equity Committee in its objection to the First Lien Claims or its motion seeking standing to prosecute certain claims
and causes of action against the First Lien Lenders.”

  

	 	8.	Point 6 of the subsection entitled “Milestones” of the Term Sheet (in reference to entry of the Disclosure Statement Order and Confirmation Order) is hereby amended such that the reference to “September
30, 2016” therein is changed to “November 11, 2016.” 

  

	 	9.	Point 7 of the subsection entitled “Milestones” of the Term Sheet (in reference to consummation of the Plan) is hereby amended such that the reference to “October 14, 2016” therein is changed to
“December 2, 2016.” 

  

	 	10.	 Point 6 of the subsection entitled “Wind Down Entity” of the “Other Terms and Conditions”
section of the Term Sheet is hereby amended by the addition of the following proviso at the end of such bullet point: “provided, that upon payment in full of the Lender Wind Down Claim, the two members of the Wind Down Entity Board

 EXECUTION VERSION 

 

	 	
designated by the Requisite Consenting Lenders shall be replaced by two members designated by the Equity Committee, provided, that the Equity Committee has designated such members by 11:59
p.m. (ET) on October 11, 2016.”

  

	 	11.	The second paragraph of Point 9 of the subsection entitled “Wind Down Entity” of the “Other Terms and Conditions” section of the Term Sheet is hereby deleted in its entirety and replaced with the
following:

 “If the class of HERO Common Stock votes to reject the Plan, the Wind Down Entity shall make distributions
(i) first, on account of the Rejection Shareholder Cash Distribution, (ii) after the Rejection Shareholder Cash Distribution has been funded in full, on account of the Rejection Lender Wind Down Claim and (iii) after payment in full of the Rejection
Lender Wind Down Claim, to holders of Wind Down Entity Interests on a pro rata basis.” 
  

	 	12.	The subsection entitled “Severance and Incentive Plan” of the “Other Terms and Conditions” section of the Term Sheet is hereby deleted in its entirety and replaced with the following:

 “The Plan shall provide that upon the Effective Date, the existing employment agreements for each of the Executives
shall be rejected, and each of the Executives shall be granted, in accordance with Bankruptcy Code section 502(b)(7), an Allowed General Unsecured Claim in an amount equal to the amount of the base salary (as of May 26, 2016) and benefits provided
by their respective employment agreements, without acceleration, for one year following the Petition Date, plus any unpaid base salary, unpaid benefits and unpaid expense reimbursements due under such employment agreements, without acceleration, as
of the Petition Date; provided, however, that (i) the aggregate amount of the portions of all such Allowed General Unsecured Claims of the Executives related to base salary (excluding unpaid base salary) shall not exceed $2.09 million, and (ii) the
amount of the portion of each such Allowed General Unsecured Claim of an Executive related to benefits (excluding unpaid benefits) shall not exceed $24,000. 

Any employment agreement or similar benefits agreement between any executive, contractor or other employee that is not an Executive and any
Debtor shall, unless otherwise agreed among the Debtors and the Requisite Consenting Lenders, be rejected immediately prior to the Effective Date of the Plan unless otherwise agreed among such executive, contractor or other employee and the
Requisite Consenting Lenders.” 

 EXECUTION VERSION 

 

 The Wind Down Entity Agreement shall provide that: 

“On the Effective Date, subject to the applicable Executive having continued their employment with the Debtors until the Effective Date,
or such Executive having been terminated without Cause (as defined in such Executive’s employment agreement) prior to the Effective Date, the following terms of compensation shall apply with respect to services to be provided by such Executive
to the Wind Down Entity: 
 (i) upon the latest of (x) the Effective Date, (y) December 31, 2016 and (z) entry into a definitive agreement
for the sale of the Hercules Triumph or the Hercules Resilience (the “Payment Trigger Date”), each Executive shall be entitled to payment of an amount equal to such Executive’s annual bonus in respect of 2015 that was paid to
such Executive in 2016 (the “Bonus Amount”); provided, however, that the Bonus Amounts paid to the Executives shall not exceed $1.51 million in the aggregate; and 

(ii) so long as an Executive is employed by the Wind Down Entity after the Effective Date, for any period that such Executive is so employed
during the period from the Effective Date through December 31, 2016, such Executive shall be compensated for his continued employment at a rate of 150% of base salary as of the Petition Date (with 125% of his base salary paid current and 25%
deferred until the Payment Trigger Date (the “Deferral Compensation”)) and for any period of employment by the Wind Down Entity from and after December 31, 2016 on such terms as may be agreed to by the Wind Down Entity and the
Executive.
 In the event an Executive resigns without “Executive Cause” (which shall mean the failure of the Wind Down Entity to
pay such Executive his compensation when due in accordance with the terms hereof or if the Executive is asked to perform any services that are immoral, illegal or unethical) prior to the Payment Trigger Date or is terminated for Cause prior to the
Payment Trigger Date, the Executive shall forfeit his rights to the Bonus Amount and the Deferral Compensation, but shall retain his rights to receive and retain payments contemplated to be paid to such Executive under Article IV.N. of the
Plan.” 
  

	 	13.	This Amendment No. 3 and the Agreement (including the Term Sheet that is attached to, and fully incorporated in, the Agreement), together, contain the complete agreement among the HERO Entities and the Ad Hoc Group
Members and supersede any prior understandings, agreements, letters of intent or representations by or among such parties, written or oral, to the extent they relate to the subject matter hereof. Except as specifically amended hereby, the
Agreement, as amended hereby, shall remain in full force and effect. 

 [Signature Pages Follow] 

 IN WITNESS WHEREOF, this Amendment No. 3 has been duly executed to be effective as of the date
first written above. 
  

			
	HERCULES OFFSHORE, INC.
		
	By:	 	 /s/ Troy L. Carson

	Name:	 	Troy L. Carson
	Title:	 	Senior Vice President & CFO
	
	CLIFFS DRILLING COMPANY
	FDT LLC
	FDT HOLDINGS LLC
	HERCULES DRILLING COMPANY, LLC
	HERCULES OFFSHORE LIFTBOAT COMPANY LLC
	HERO HOLDINGS, INC.
	SD DRILLING LLC
	THE OFFSHORE DRILLING COMPANY
	THE ONSHORE DRILLING COMPANY
	TODCO AMERICAS INC.
	TODCO INTERNATIONAL INC.
	HERCULES LIFTBOAT COMPANY, LLC
	HERCULES OFFSHORE SERVICES LLC
	HERCULES OFFSHORE INTERNATIONAL, LLC
		
	By:	 	 /s/ Troy L. Carson

	Name:	 	Troy L. Carson
	Title:	 	Vice President

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	DISCOVERY OFFSHORE (GIBRALTAR) LIMITED
		
	By:	 	 /s/ Troy L. Carson

	Name:	 	Troy L. Carson
	Title:	 	Authorized Signatory
		
	By:	 	 /s/ Beau M. Thompson

	Name:	 	Beau M. Thompson
	Title:	 	Authorized Signatory

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	HERCULES OFFSHORE (NIGERIA) LIMITED
		
	By:	 	 /s/ Troy L. Carson

	Name:	 	Troy L. Carson
	Title:	 	Authorized Signatory

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	DISCOVERY NORTH SEA LTD.
	DISCOVERY OFFSHORE SERVICES LTD.
	HERCULES ASSET MANAGEMENT LTD.
	HERCULES INTERNATIONAL DRILLING LTD.
	HERCULES INTERNATIONAL HOLDINGS, LTD.
	HERCULES INTERNATIONAL MANAGEMENT COMPANY LTD.
	HERCULES INTERNATIONAL OFFSHORE, LTD.
	HERCULES NORTH SEA, LTD.
	HERCULES OFFSHORE ARABIA, LTD.
	HERCULES OFFSHORE HOLDINGS LTD.
	HERCULES OFFSHORE MIDDLE EAST LTD.
	HERCULES OILFIELD SERVICES LTD.
	TODCO TRINIDAD LTD.
		
	By:	 	 /s/ Claus E. Feyling

	Name:	 	Claus E. Feyling
	Title:	 	Director

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	HERCULES OFFSHORE LABUAN CORPORATION
		
	By:	 	 /s/ Claus E. Feyling

	Name:	 	Claus E. Feyling
	Title:	 	Director

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	HERCULES BRITANNIA HOLDINGS LIMITED
	HERCULES BRITISH OFFSHORE LIMITED
	HERCULES NORTH SEA DRILLER LIMITED
	HERCULES OFFSHORE UK LIMITED
		
	By:	 	 /s/ Claus E. Feyling

	Name:	 	Claus E. Feyling
	Title:	 	Director

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	NOMURA CORPORATION RESEARCH AND ASSET MANAGEMENT INC., as investment manager on behalf of certain of its clients
		
	By:	 	 /s/ Steven Kotsen

	Name:	 	Steven Kotsen
	Title:	 	Portfolio Manager

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	TURAIS HERO LLC, as Lender
		
	By:	 	 /s/ Jeffrey Wade

	Name:	 	Jeffrey Wade
	Title:	 	General Counsel

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	LUMINUS ENERGY PARTNERS MASTER FUND, LTD., as Lender
		
	By:	 	 /s/ Jeffrey Wade

	Name:	 	Jeffrey Wade
	Title:	 	General Counsel

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	BLACKWELL PARTNERS LLC – SERIES A
	By: Bowery Investment Management, LLC, its Manager
		
	By:	 	 /s/ Vladimir Jelisavcic

	Name:	 	Vladimir Jelisavcic
	Title:	 	Manager
	
	BOWERY OPPORTUNITY FUND, L.P.
	By: Bowery Opportunity Management, LLC, its General Partner
		
	By:	 	 /s/ Vladimir Jelisavcic

	Name:	 	Vladimir Jelisavcic
	Title:	 	Manager
	
	BOWERY OPPORTUNITY FUND, Ltd.
		
	By:	 	 /s/ Vladimir Jelisavcic

	Name:	 	Vladimir Jelisavcic
	Title:	 	Director
	
	P BOWERY, LTD
	By: Bowery Investment Management, LLC, its investment manager
		
	By:	 	 /s/ Vladimir Jelisavcic

	Name:	 	Vladimir Jelisavcic
	Title:	 	Manager

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	WESTERN ASSET MANAGEMENT COMPANY, as Investment Manager and Agent on behalf of Certain of its Clients
		
	By:	 	 /s/ Adam Wright

	Name:	 	Adam Wright
	Title:	 	Manager, U.S. Legal Affairs

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	QUANTUM PARTNERS LP, as holder of HERO Equity Interests
	By: QP GP LLC, its General Partner
		
	By:	 	 /s/ Thomas O’ Grady

	Name:	 	Thomas O’ Grady
	Title:	 	Attorney-in-Fact

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	QPB HOLDINGS LTD., as Lender
		
	By:	 	 /s/ Thomas O’ Grady

	Name:	 	Thomas O’ Grady
	Title:	 	Attorney-in-Fact

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	SOUTH DAKOTA RETIREMENT SYSTEM
		
	By:	 	 /s/ Matthew L. Clark

	Name:	 	Matthew L. Clark
	Title:	 	State Investment Officer on behalf of the South Dakota Retirement System

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	CERTAIN FUNDS AND ACCOUNTS EACH ACTING as Lender, severally and not jointly
	
	T. ROWE PRICE ASSOCIATES, INC., as investment advisor or subadviser, as applicable
		
	By:	 	 /s/ Rodney M. Rayburn

	Name:	 	Rodney M. Rayburn
	Title:	 	Vice President

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	BANK OF AMERICA, N.A., as a Lender
		
	By:	 	 /s/ Seth Denson

	Name:	 	Seth Denson
	Title:	 	Director

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	THIRD AVENUE TRUST, on behalf of the THIRD AVENUE FOCUSED CREDIT FUND
	
	By: THIRD AVENUE MANAGEMENT LLC, its investment advisor
		
	By:	 	 /s/ W. James Hall

	Name:	 	W. James Hall
	Title:	 	General Counsel

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT] 

 
			
	JEFFERIES LEVERAGED CREDIT PRODUCTS LLC, as Lender
		
	By:	 	 /s/ William P. McLoughlin

	Name:	 	William P. McLoughlin
	Title:	 	Senior Vice President and Associate General Counsel

  
 [SIGNATURE
PAGE TO AMENDMENT NO. 3 TO THE AGREEMENT]Exhibit

Exhibit 10.6

 
ALTISOURCE RESIDENTIAL CORPORATION
2016 EQUITY INCENTIVE PLAN
Stock Option Award Agreement
This Stock Option Award Agreement (this “Agreement”) is made by and between Altisource Residential Corporation, a Maryland corporation (the “Corporation”), and [●] (the “Participant”), effective as of [●] (the “Date of Grant”).
RECITALS
WHEREAS, the Corporation has adopted the Altisource Residential Corporation 2016 Equity Incentive Plan (as the same may be amended from time to time, the “Plan”), which Plan is incorporated herein by reference and made a part of this Agreement, and capitalized terms not otherwise defined in this Agreement shall have the meanings ascribed to those terms in the Plan; and
WHEREAS, the Committee has authorized and approved the grant of an Award to the Participant of Stock Options to purchase shares of Common Stock (“Shares”) on the terms and conditions set forth in the Plan and this Agreement. 
NOW THEREFORE, for services provided by the Participant to the Corporation or one of its Affiliates (“Service”) and in consideration of the promises and mutual covenants set forth in this Agreement, the parties agree as follows:
		
	1.
	Grant of Stock Options. The Corporation hereby grants to the Participant, effective as of the Date of Grant, the right and option to purchase, on the terms and conditions set forth in the Plan and this Agreement, all or any part of an aggregate of [●] Shares, subject to adjustment as set forth in the Plan (the “Options”). The Options are intended to be nonqualified stock options. 

		
	2.
	Exercise Price. The exercise price of each Option is [●] per Share, subject to adjustment as set forth in the Plan (the “Exercise Price”).

		
	3.
	Vesting of Options. 

		
	(a)
	General. 

		
	(i)
	Subject to the Participant’s continued Service through each applicable vesting date:

		
	1.
	one-third of the Options shall vest upon the later of (A) the first anniversary of the Date of Grant and (B) the date the Performance Goal (as defined in Section 3(a)(ii)) is attained;

		
	2.
	one-third of the Options shall vest upon the later of (A) the second anniversary of the Date of Grant and (B) the date the Performance Goal is attained; and

1

		
	3.
	one-third of the Options shall vest upon the later of (A) the third anniversary of the Date of Grant and (B) the date the Performance Goal is attained;

provided, however, that, except as set forth in Section 3(b), no portion of the Options shall vest if the Performance Goal is not attained on or prior to the fourth anniversary of the Date of Grant. 
		
	(ii)
	For purposes of this Agreement, the “Performance Goal” shall be attained on the date, which date must occur, if ever, no later than the fourth anniversary of the Date of Grant, that the sum of (a) the average price per Share for the consecutive 20-trading-day period ending on such date plus (b) the amount of all reinvested dividends, calculated on a per-share basis, from the Date of Grant through such date shall equal or exceed 125% of the price per Share on the Date of Grant (i.e., 125% of the Exercise Price). If the Performance Goal is not attained on or prior to the fourth anniversary of the Date of Grant, then, except as set forth in Section 3(b), no portion of the Options shall vest.

		
	(b)
	Termination of Service. 

		
	(i)
	All unvested Options shall fully vest upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason, in either case, on or within two years following a Change of Control.

		
	(ii)
	Upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason other than as set forth in clause (i) above and at a time when the Performance Goal has previously been attained, a portion of the unvested Options shall immediately vest based on the product of (x) the total number of unvested Options and (y) a fraction, the numerator of which is the number of full calendar months elapsed from the Date of Grant or, if later, the most recent anniversary thereof, through the date of termination, and the denominator of which is the number of full calendar months from the Date of Grant, or, if later, the most recent anniversary thereof through the third anniversary of the Date of Grant (i.e., 36, 24 or 12). Any portion of the unvested Options that does not vest in accordance with the immediately preceding sentence shall be forfeited immediately, automatically and without consideration on the date of termination of Service.

		
	(iii)
	Upon a termination of the Participant’s Service by the Corporation without Cause or by the Participant for Good Reason other than as set forth in clause (i) above and at a time when the Performance Goal has not yet been attained, a portion of the unvested Options shall initially remain outstanding and eligible to vest based on the product of (x) the total number of unvested Options and (y) a fraction, the numerator of which is the number of full calendar months elapsed from the Date of Grant through the date of termination (such number not to exceed 36), and the denominator of which is 36. Such portion of the unvested Options shall remain outstanding until the earlier of (I) the date the Performance Goal is attained, in which case such portion shall vest, and (II) the fourth anniversary of the Date of Grant, in which case such portion shall be forfeited immediately, automatically and without consideration. Any portion of the unvested Options that does not remain outstanding in accordance with the immediately preceding sentence shall be forfeited immediately, automatically and without consideration on the date of termination of Service.

2

		
	(iv)
	All unvested Options shall fully vest upon a termination of the Participant’s Service due to death or Disability.

		
	(v)
	All vested and unvested Options will be forfeited immediately, automatically and without consideration upon a termination of Service for Cause.

		
	(vi)
	Except as otherwise set forth in clauses (i) through (v) above, any unvested Options will be forfeited immediately, automatically and without consideration upon a termination of Service for any reason. 

		
	(vii)
	For purposes of this Agreement: 

		
	1.
	“Cause” means gross or willful neglect of duty that is not corrected after 30 days’ written notice thereof; misconduct, malfeasance, fraud or dishonesty that materially and adversely affects the Corporation or its reputation in the industry; or the commission of a felony or a crime involving moral turpitude. All determinations as to Cause shall be made by the Committee in its sole discretion.

		
	2.
	“Disability” means a medically determinable physical or mental impairment that is expected to result in death or that has lasted or can be expected to last for either (x) a continuous period of at least 90 days or (y) an aggregate of 90 days in any 180-day period. 

		
	3.
	“Good Reason” means, without the consent of the Participant, (i) a material diminution in the Participant’s title, position, duties or responsibilities with respect to the Corporation, or (ii) the notification of the Participant by the Corporation that the Corporation shall require the Participant to relocate his or her primary place of Service with the Corporation to a site that is more than 50 miles from both the Participant’s current primary place of Service and the Participant’s primary residence; provided, however, that no act or omission described in clause (i) or (ii) shall be treated as “Good Reason” under this Agreement unless (a) the Participant delivers to the Corporation a written statement of the basis for Participant’s belief that Good Reason exists within 120 days following the date such basis first arises, (b) the Corporation fails to cure the grounds constituting Good Reason within 30 days following Participant’s delivery of such written statement, and (c) Participant actually resigns within 90 days of such failure to cure.

		
	4.
	Expiration. Any unvested Options will expire on the fourth anniversary of the Date of Grant, and any vested but unexercised Options will expire on the seventh anniversary of the Date of Grant, or earlier as provided in this Agreement or the Plan (the “Expiration Date”).

		
	5.
	Period of Exercise. Subject to the provisions of the Plan and this Agreement, the Participant may exercise all or any part of the vested Options at any time prior to the earliest to occur of:

		
	(a)
	the Expiration Date;

		
	(b)
	the date that is 12 months following termination of the Participant’s Service due to death or Disability;

3

		
	(c)
	the date that is 90 days following termination of the Participant’s Service other than for death, Disability or Cause; or

		
	(d)
	the date of termination of the Participant’s Service for Cause.

		
	6.
	Exercise of Options. 

		
	(a)
	Notice of Exercise. Subject to Sections 3, 4 and 5, the Participant or, in the case of the Participant’s death or Disability, the Participant’s representative may exercise all or any part of the vested Options (covering whole Shares) through an approved online securities account (or as otherwise specified by the Committee) in accordance with the procedures therein (a “Notice of Exercise”). The Notice of Exercise will be electronically executed by the person exercising the Options. In the event that the Options are being exercised by the Participant’s representative, the Notice of Exercise will be accompanied by proof (satisfactory to the Committee) of the representative’s right to exercise the Options. The Participant or the Participant’s representative will deliver to the Committee, at the time of giving the Notice of Exercise, payment in a form permissible under Section 7 for the full amount of the Purchase Price (as defined below) and applicable withholding taxes as provided below.

		
	(b)
	Issuance of Shares. After all requirements with respect to the exercise of the Options have been satisfied, the Committee will cause the Shares as to which the Options have been exercised to be issued (or, in the Committee’s discretion, in un-certificated form, upon the books of the Corporation’s transfer agent), registered in the name of the person exercising the Options (or in the names of such person and his or her spouse as community property or as joint tenants with right of survivorship). Neither the Corporation nor the Committee will be liable to the Participant or any other Person for damages relating to any delays in issuing the Shares or any mistakes or errors in the issuance of the Shares.

		
	(c)
	Withholding Requirements. The Corporation in its sole discretion shall have the power and the right to deduct or withhold automatically from any Shares deliverable under this Agreement, or to require the Participant or the Participant’s representative to remit to the Corporation, the minimum statutory amount necessary to satisfy federal, state and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement, or in the sole discretion of the Committee, such greater amount necessary to satisfy the Participant’s expected tax liability, provided that, the withholding of such greater amount does not result in adverse tax or accounting consequences to the Corporation (the “Withheld Taxes”).

		
	7.
	Payment for Shares. The “Purchase Price” will be the Exercise Price multiplied by the number of Shares with respect to which Options are being exercised. All or part of the Purchase Price and any Withheld Taxes may be paid as follows:

		
	(a)
	Cash or Check. In cash or by bank certified check.

		
	(b)
	Brokered Cashless Exercise. To the extent permitted by applicable law and the Committee, from the proceeds of a sale through a broker on the date of exercise of some or all of the Shares to which the exercise relates. In that case, the Participant will electronically execute a Notice of Exercise and provide the Corporation’s third-party Plan administrator with a copy of irrevocable instructions to a broker to deliver promptly to the Corporation the amount of sale proceeds to pay the aggregate purchase price and/or Withheld Taxes, as applicable. To 

4

facilitate the foregoing, the Corporation may, to the extent permitted by applicable law, enter into agreements or coordinate procedures with one or more brokerage firms.
		
	(c)
	Net Exercise. By reducing the number of Shares otherwise deliverable upon the exercise of the Options by the number of Shares having a Fair Market Value equal to the amount of the Purchase Price and/or Withheld Taxes, as applicable.

		
	(d)
	Surrender of Stock. In each instance, at the sole discretion of the Committee, by surrendering, or attesting to the ownership of, Shares that are already owned by the Participant free and clear of any restriction or limitation, unless the Committee specifically agrees in writing to accept such Shares subject to such restriction or limitation. Such Shares will be surrendered to the Corporation in good form for transfer and will be valued by the Corporation at their Fair Market Value on the date of the applicable exercise of the Options, or to the extent applicable, on the date the Withheld Taxes are to be determined. The Participant will not surrender, or attest to the ownership of, Shares in payment of the Purchase Price (or Withheld Taxes) if such action would cause the Corporation to recognize compensation expense (or additional compensation expense) with respect to the Options for financial reporting purposes that otherwise would not have been recognized (collectively, “Withheld Taxes”).

		
	8.
	Adjustment to Options. In the event of any change with respect to the outstanding shares of Common Stock contemplated by Section 8 of the Plan, the Options may be adjusted in accordance with Section 8 of the Plan.

		
	9.
	Miscellaneous Provisions.

		
	(a)
	Securities Laws Requirements. No Shares will be issued or transferred pursuant to this Agreement unless and until all then applicable requirements imposed by federal and state securities and other laws, rules and regulations and by any regulatory agencies having jurisdiction, and by any exchanges upon which the Shares may be listed, have been fully met. As a condition precedent to the issuance of Shares pursuant to this Agreement, the Corporation may require the Participant to take any reasonable action to meet those requirements. The Committee may impose such conditions on any Shares issuable pursuant to this Agreement as it may deem advisable, including, without limitation, restrictions under the Securities Act, under the requirements of any exchange upon which shares of the same class are then listed and under any blue-sky or other securities laws applicable to those Shares. 

		
	(b)
	No Rights as Shareholder. Neither the Participant nor the Participant’s representative will have any rights as a shareholder of the Corporation with respect to any Shares subject to the Options until the Participant or the Participant’s representative becomes entitled to receive those Shares by (i) electronically executing a Notice of Exercise, (ii) paying the Purchase Price and Withheld Taxes as provided in this Agreement, and the Corporation actually receiving those amounts, (iii) the Corporation issuing those Shares and entering the name of the Participant in the register of shareholders of the Corporation as the registered holder of those Shares and (iv) satisfying any other conditions as the Committee reasonably requires.

		
	(c)
	Transfer Restrictions. The Shares purchased by exercise of the Options will be subject to such stop-transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, any applicable federal or state laws and any agreement with, or policy of, the Corporation or the Committee to which 

5

the Participant is a party or subject, and the Committee may cause orders or designations to be placed upon the books and records of the Corporation’s transfer agent to make appropriate reference to such restrictions.
		
	(d)
	No Right to Continued Service. Nothing in this Agreement or the Plan confers upon the Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation or any Affiliate or of the Participant, which rights are hereby expressly reserved, to terminate the Participant’s Service at any time and for any reason, with or without Cause.

		
	(e)
	Notification. Any notification required by the terms of this Agreement will be given by the Participant (i) in a writing addressed to the Corporation at its principal executive office, or (ii) by electronic transmission to the Corporation’s e-mail address of the Corporation’s General Counsel. Any notification required by the terms of this Agreement will be given by the Corporation (x) in a writing addressed to the address that the Participant most recently provided to the Corporation, or (y) by facsimile or electronic transmission to the Participant’s primary work fax number or e-mail address (as applicable).

		
	(f)
	Entire Agreement. This Agreement and the Plan constitute the entire agreement between the parties hereto with regard to the subject matter of this Agreement. This Agreement and the Plan supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) that relate to the subject matter of this Agreement.

		
	(g)
	Waiver. No waiver of any breach or condition of this Agreement will be deemed to be a waiver of any other or subsequent breach or condition whether of like or different nature.

		
	(h)
	Successors and Assigns. The provisions of this Agreement will inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and upon the Participant, the Participant’s executor, personal representative(s), distributees, administrator, permitted transferees, permitted assignees, beneficiaries, and legatee(s), as applicable, whether or not any such person will have become a party to this Agreement and have agreed in writing to be joined herein and be bound by the terms hereof.

		
	(i)
	Severability. The provisions of this Agreement are severable, and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, then the remaining provisions will nevertheless be binding and enforceable.

		
	(j)
	Amendment. Except as otherwise provided in the Plan, this Agreement will not be amended unless the amendment is agreed to in writing by both the Participant and the Corporation.

		
	(k)
	Choice of Law; Jurisdiction. This Agreement and all claims, causes of action or proceedings (whether in contract, in tort, at law or otherwise) that may be based upon, arise out of or relate to this Agreement will be governed by the internal laws of the State of Maryland, excluding any conflicts- or choice-of-law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. 

		
	(l)
	Signature in Counterparts. This Agreement may be signed in counterparts, manually or electronically, each of which will be an original, with the same effect as if the signatures to each were upon the same instrument.

6

		
	(m)
	Acceptance. The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms and provisions of the Plan and this Agreement, and accepts the Options subject to all of the terms and conditions of the Plan and this Agreement. In the event of a conflict between any term or provision contained in this Agreement and a term or provision of the Plan, the applicable term and provision of the Plan will govern and prevail.

[Signature page follows.]

7

IN WITNESS WHEREOF, the Corporation and the Participant have executed this Stock Option Award Agreement as of the Date of Grant.

	
						
	PARTICIPANT
	 
	ALTISOURCE RESIDENTIAL CORPORATION

	 
	 
	 
	 
	 
	 

	Signed:
	 
	 
	By:
	 
	 

	 
	 
	 
	 
	 
	 

	Printed:
	 
	 
	Name:
	 
	 

	 
	 
	 
	 
	 
	 

	 
	 
	 
	Title:
	 
	 

[Signature Page - Options Award Agreement]

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