UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

SCHEDULE 14A INFORMATION

 

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

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[  ] Definitive Additional Materials

[  ] Soliciting Material Pursuant to ss.240.14a-12

 

OCWEN FINANCIAL CORPORATION
 
(Name of Registrant as Specified in its Charter)

 

N/A

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

 

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April 27, 2020

 

Dear Fellow Shareholder:

 

On behalf of the Board of Directors, I cordially invite you to participate in the Annual Meeting of Shareholders of Ocwen Financial Corporation, which will be held on Wednesday, May 27, 2020, at 9:00 a.m., Eastern Daylight Time. In light of public health concerns regarding the coronavirus outbreak, we will be hosting this year’s Annual Meeting in a virtual format only via live audiocast on the Internet at www.virtualshareholdermeeting.com/OCN2020. To participate, vote or submit questions during the Annual Meeting via live audiocast, please review the detailed procedures included in our Notice of Annual Meeting. You will not be able to attend the Annual Meeting in person. This does not represent a change in our shareholder engagement philosophy and we intend to return to an in-person meeting next year.

 

The matters to be considered by shareholders at the Annual Meeting are described in detail in the accompanying materials.

 

It is very important that you be represented at the Annual Meeting regardless of the number of shares you own or whether you are able to participate in our virtual Annual Meeting. We encourage you to complete your proxy card in one of the manners described in the accompanying materials even if you plan to participate in the Annual Meeting. This will not prevent you from voting during the Annual Meeting if you choose to participate and vote at that time, but will ensure that your vote is counted if you are unable to participate. If you are a beneficial owner holding shares through a brokerage firm, bank, broker-dealer, or similar organization you should follow the instructions on your voting instruction form to vote your shares. Please note that if you are a beneficial owner of our shares you cannot vote your shares at the Annual Meeting unless you have obtained a legal proxy from your brokerage firm, bank, broker-dealer, or similar organization.

 

Your continued support of, and interest in, Ocwen Financial Corporation is sincerely appreciated.

 

Sincerely,

 

Phyllis R. Caldwell

Chair, Board of Directors

 

   

 

 

OCWEN FINANCIAL CORPORATION

 

1661 Worthington Road, Suite 100

West Palm Beach, Florida 33409

 

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS AND

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS

FOR THE SHAREHOLDER MEETING TO BE HELD ON MAY 27, 2020

 

NOTICE

 

Our Annual Meeting of Shareholders will be held:

 

  Date: Wednesday, May 27, 2020
  Time: 9:00 a.m., Eastern Daylight Time
  Location: Virtual Meeting Only via Live Audiocast

 

Please review the instructions contained in this Proxy Statement if you wish to participate in the virtual Annual Meeting.

 

PURPOSE

 

  To elect seven directors for one-year terms or until their successors are elected and qualified;
     
  To ratify, on an advisory basis, the appointment by the Audit Committee of our Board of Directors of Deloitte & Touche LLP as the independent registered public accounting firm of Ocwen Financial Corporation for the fiscal year ending December 31, 2020;
     
  To hold an advisory vote to approve executive compensation (“Say-on-Pay”);
     
  To hold an advisory vote to approve an amendment to our Articles of Incorporation to implement a reverse stock split of our issued and outstanding common stock in a ratio between 1-for-5 and 1-for-25 and reduce the number of authorized shares of our common stock by the same proportion as the ratio of our reverse stock split;
     
  To approve a proposal to adjourn the Annual Meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes at the time of the Annual Meeting to approve Proposal Four; and
     
  To transact such other business as may properly come before the meeting and any postponement or adjournment of the meeting. Management is not aware of any such other business at this time.

 

PROCEDURES

 

  Our Board of Directors has fixed March 27, 2020 as the record date for the determination of shareholders entitled to notice of and to vote at the Annual Meeting.
     
  Shareholders of record at the close of business on the record date will be entitled to vote and ask questions online at the Annual Meeting. Please note that if you do not have your control number, you will be able to access and listen to the Annual Meeting but you will not be able to vote your shares or submit questions during the Annual Meeting.
     
  If you would like to attend the virtual meeting and you have your control number, please go to www.virtualshareholdermeeting.com/OCN2020 15 minutes prior to the start of the meeting to log in. For shareholders who hold shares in street name, if you came through your brokerage firm’s website and do not have your control number, you can gain access to the meeting by logging into your brokerage firm’s website 15 minutes prior to the meeting start, selecting the shareholder communications mailbox to link through to the meeting and the control number will automatically populate. For technical assistance when logging into Ocwen’s Annual Meeting, please call 800-586-1548 (US) or 303-562-9288 (International).
     
  If you wish to submit a question during the Annual Meeting, log into the virtual meeting platform at www.virtualshareholdermeeting.com/OCN2020, type your question into the “Ask a Question” field, and click “Submit.”

 

This proxy statement for our 2020 Annual Meeting of Shareholders and our Annual Report to shareholders on Form 10-K for the year ended December 31, 2019 will be available on or about April 27, 2020 on our website at www.ocwen.com in the Financial Information section under the “Shareholders” tab. The approximate date on which this proxy statement, the proxy card and other accompanying materials are first being sent or given to shareholders is April 27, 2020. Additionally, and in accordance with Securities and Exchange Commission rules, you may access our annual report and proxy materials at http://shareholders.ocwen.com/sec.cfm, a website that does not identify or track visitors of the site.

 

If you have questions for Ocwen Financial Corporation regarding this virtual Annual Meeting, please contact our shareholder relations department at shareholderrelations@ocwen.com.

 

By Order of the Board of Directors,

 

Joseph J. Samarias

Secretary

April 27, 2020

 

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OCWEN FINANCIAL CORPORATION

 

PROXY STATEMENT

 

ANNUAL MEETING OF SHAREHOLDERS

 

General Information

 

This proxy statement is being furnished to you in connection with the solicitation of proxies by the Board of Directors of Ocwen Financial Corporation (“Ocwen,” the “Company,” “we,” “us,” or “our”) for use at our 2020 Annual Meeting of Shareholders (the “Annual Meeting”) and at any postponement or adjournment of this meeting. The approximate date on which this proxy statement, the proxy card and other accompanying materials are first being sent or given to shareholders is April 27, 2020. The Annual Meeting will be held on Wednesday, May 27, 2020, at 9:00 a.m., Eastern Daylight Time, for the purposes listed in the Notice of Annual Meeting of Shareholders. In light of public health concerns regarding the coronavirus outbreak, we will be hosting this year’s Annual Meeting via live audiocast on the Internet at www.virtualshareholdermeeting.com/OCN2020. This does not represent a change in our shareholder engagement philosophy and we intend to return to an in-person meeting next year. If you are interested in participating in the virtual meeting, voting or submitting questions at that time, please see “Annual Meeting Participation” below for further details. Please note that except as otherwise specified, all share and dollar amounts set forth in this Proxy Statement are on a pre-Reverse Stock Split basis.

 

How a Proxy Works

 

The Board of Directors has appointed Glen A. Messina, President and Chief Executive Officer, and Joseph J. Samarias, Executive Vice President, General Counsel and Secretary, as the management proxy holders for the Annual Meeting. If you properly complete, sign and return your proxy card by mail, or submit your proxy by Internet or telephone, and do not revoke it prior to its use, your shares will be voted in accordance with your instructions. If you do not give contrary instructions, the management proxy holders will vote all shares represented by valid proxies as follows:

 

  Proposal One (Election of Directors) - “FOR ALL” of the seven nominees for Director;
     
  Proposal Two (Advisory Ratification of Appointment of Independent Registered Public Accounting Firm) - “FOR” ratification, on an advisory basis, of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2020;
     
  Proposal Three (Advisory Resolution on Named Executive Officer Compensation) - “FOR” approval, on an advisory basis, of the compensation of Ocwen’s executive officers whose compensation is disclosed in this proxy statement (“named executive officers”) (“Say-on-Pay”);
     
  Proposal Four (Advisory Approval of an Amendment to the Articles of Incorporation to Effect a Reverse Stock Split) - “FOR” approval, on an advisory basis, of an amendment to our Articles of Incorporation to implement a reverse stock split of our issued and outstanding common stock in a ratio between 1-for-5 and 1-for-25 and reduce the number of authorized shares of our common stock by the same proportion as the ratio of our reverse stock split
     
  Proposal Five (Adjournment of Meeting to Solicit Additional Proxies for Proposal Four) - “FOR” approval of a proposal to adjourn the Annual Meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes at the time of the Annual Meeting to approve Proposal Four; and

 

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  with regard to any other business that properly comes before the meeting, in accordance with the best judgment of the management proxy holders. As of the date of this proxy statement, we do not know of any other business that may come before the Annual Meeting.

 

How to Revoke a Proxy

 

Your proxy may be used only at the Annual Meeting and any postponement or adjournment of this meeting and may not be used for any other meeting. You have the power to revoke your proxy at any time before it is exercised by:

 

  filing written notice of revocation with our Secretary at the following address:
    Joseph J. Samarias, Secretary
    c/o Ocwen Financial Corporation
    1661 Worthington Road, Suite 100
    West Palm Beach, Florida 33409
     
  submitting a properly executed proxy card bearing a later date or submitting another proxy using the Internet or by telephone (your latest Internet or telephone voting instructions will be followed), or
     
  participating in the virtual Annual Meeting and giving the Secretary notice of your intention to vote at that time.

 

If you are interested in participating in the virtual Annual Meeting, voting or submitting questions at that time, please see “Annual Meeting Participation” below for further details.

 

Who May Vote at the Annual Meeting

 

On all matters properly presented at the Annual Meeting, each share of our common stock is entitled to one vote. All shareholders who owned our common stock as of the close of business on March 27, 2020 (the “Record Date”) are cordially invited to participate in the 2020 Annual Meeting. Only shareholders of record or beneficial owners of shares of our common stock at the close of business on the Record Date are entitled to participate and vote at the Annual Meeting or any postponement or adjournment of this meeting. If your shares are registered directly in your name with American Stock Transfer & Trust Company, Ocwen’s stock transfer agent, you are the “shareholder of record” with respect to those shares. If your shares are held in an account at a brokerage firm, bank, broker-dealer, or similar organization (collectively, “Broker”), then you are the “beneficial owner of shares held in street name.” As a beneficial owner, you have the right to instruct your Broker how to vote your shares. Most individual shareholders are beneficial owners of shares held in street name. At the close of business on the Record Date, there were 134,956,288 shares of common stock issued and outstanding.

 

How to Vote if you are a Shareholder of Record

 

If you are a shareholder of record and you have received a printed set of the proxy materials by mail, we encourage you to fill in, date and sign the enclosed proxy card and mail it promptly in the enclosed envelope to make sure that your shares are represented at the Annual Meeting. Shareholders of record also have the option of voting by using a toll-free telephone number or via the Internet. Instructions for using these services are included on the proxy card. If you are a shareholder of record and participate in the Annual Meeting, you may, if you desire, revoke your proxy in accordance with the procedures described in this Proxy Statement and vote your shares during the meeting. Please note that your presence (without further action) at the Annual Meeting will not constitute revocation of a previously given proxy.

 

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How to Give Voting Instructions if you are a Beneficial Owner of Shares held in Street Name

 

If you are a beneficial owner of shares held in street name, you are considered the beneficial owner of the shares, and your shares may be voted at the Annual Meeting only by the Broker that holds your shares. To instruct your Broker how your shares are to be voted at the Annual Meeting, you will need to follow the instructions provided by the Broker that holds your shares. Many Brokers offer the option of submitting voting instructions over the Internet or by telephone. You are also welcome to participate in the Annual Meeting, but you will need to follow the instructions provided to you by your Broker. Please note that if you are a beneficial owner of our shares you cannot vote your shares at the Annual Meeting unless you have obtained a legal proxy from your Broker. Please contact your Broker for further information. If you wish to revoke your proxy any time before the Annual Meeting you should contact your Broker to find out how to change or revoke your voting instructions.

 

If you hold your shares in street name through a brokerage account and you do not submit instructions to your Broker about how your shares are to be voted, one of two things can happen depending on the type of proposal. If the proposal involves a “routine” matter, then the rules of the New York Stock Exchange provide Brokers discretionary power to vote your shares even if you do not provide instructions. “Routine” matters include proposals to ratify the appointment of the independent registered public accounting firm, provide advisory approval of an amendment to our Articles of Incorporation to implement a reverse stock split, and approve a proposal to authorize an adjournment of the Annual Meeting to solicit additional proxies for Proposal Four. If, however, the proposal involves a “non-routine” matter, such as the proposals to elect directors and vote on executive compensation, then Brokers are not permitted to vote your shares without instruction from you. If you do not submit voting instructions to your Broker and your Broker exercises its discretion to vote your shares on Proposal Two to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2020, Proposal Four to approve a reverse stock split of our issued and outstanding common stock and reduce the number of authorized shares of our common stock by the same proportion as the ratio of our reverse stock split, or Proposal Five to authorize an adjournment of the Annual Meeting to solicit additional proxies for Proposal Four, your shares will constitute broker “non-votes” on each of the other proposals at the Annual Meeting. Therefore, it is important that you provide instructions to your Broker if your shares are held by a Broker so that your votes with respect to election of directors and Say-on-Pay are counted.

 

Quorum and Voting Information

 

The presence at the Annual Meeting of a majority of the votes of our common stock entitled to vote, represented in person or by proxy, will constitute a quorum for the transaction of business at the Annual Meeting.

 

Assuming a quorum, the seven nominees for director receiving a plurality of the votes cast for director will be elected as directors of Ocwen. A plurality vote requirement means that the director nominees with the greatest number of votes cast, even if less than a majority, will be elected. There is no cumulative voting. You may vote in favor of or withhold authority to vote for one or more nominees for director. For Proposal Two to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2020, Proposal Three to approve the Say-on-Pay, Proposal Four to approve a reverse stock split of our issued and outstanding common stock and reduce the number of authorized shares of our common stock by the same proportion as the ratio of our reverse stock split, and Proposal Five to authorize an adjournment of the Annual Meeting to solicit additional proxies for Proposal Four, the proposal will be approved if the votes cast by the holders of the shares represented at the Annual Meeting and entitled to vote in favor of the action exceed the votes cast opposing the action. Because Proposal Two to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2020 and Proposal Three to approve the Say-on-Pay are advisory in nature, there is no specific requirement for approval for these proposals. It will be up to the Audit Committee and the Compensation and Human Capital Committee with respect to Proposals Two and Three, respectively, as well as the Board of Directors, to determine whether and how to implement the advisory votes on the ratification of the appointment of our independent registered public accounting firm and Say-on-Pay. In addition, Proposal Four to approve a reverse stock split of our issued and outstanding common stock and reduce the number of authorized shares of our common stock by the same proportion as the ratio of our reverse stock split is also advisory in nature. Under Florida law, because we are reducing our authorized shares proportionately, our Board is not required to submit the proposal regarding our reverse stock split to shareholders and may elect, as it determines to be in the best interests of the Company and our shareholders, whether or not to effect a Reverse Stock Split, and if so, at which split ratio. However, while our Board is seeking, and will give appropriate consideration to, advisory feedback from our shareholders in the form of Proposal Four, our Board may elect to implement a Reverse Stock Split at its sole discretion, even if the proposed Reverse Stock Split is not approved by our shareholders.

 

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Abstentions will be counted as present and entitled to vote for purposes of determining whether a quorum is present. For Proposal One on the election of directors, a “withhold vote” will not be counted in determining the vote’s outcome, because the candidates who receive the highest number of “for” votes are elected, and candidates only need a single “for” vote to be elected. Abstentions will not be counted as votes cast with respect to Proposal Two to ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2020, Proposal Three to approve the Say-on-Pay, Proposal Four to approve a reverse stock split of our issued and outstanding common stock and reduce the number of authorized shares of our common stock by the same proportion as the ratio of our reverse stock split, or Proposal Five to authorize an adjournment of the Annual Meeting to solicit additional proxies for Proposal Four and therefore will not be counted in determining the outcome of those proposals. If any broker “non-votes” occur at the meeting with respect to your shares, the broker “non-votes” will be counted as present and entitled to vote for purposes of determining whether a quorum is present, but will not be counted as votes cast with respect to Proposal One on the election of directors or Proposal Three to approve the Say-on-Pay.

 

Annual Meeting Participation

 

In light of public health concerns regarding the coronavirus outbreak and to support the health and wellbeing of our shareholders, our directors, and our employees, we will be hosting this year’s Annual Meeting via live audiocast on the Internet at www.virtualshareholdermeeting.com/OCN2020. You will not be able to attend the Annual Meeting in person. This does not represent a change in our shareholder engagement philosophy and we intend to return to an in-person meeting next year. Our shareholders will be afforded the same opportunities to participate at the virtual Annual Meeting as they would at an in-person annual meeting of shareholders.

 

Shareholders of record will be able to vote and ask questions online during the meeting. If you would like to attend the virtual Annual Meeting and you have your control number, please go to www.virtualshareholdermeeting.com/OCN2020 15 minutes prior to the start of the meeting to log in. Please note that if you do not have your control number, you will be able to access and listen to the Annual Meeting but you will not be able to vote your shares or submit questions during the Annual Meeting. For shareholders who hold shares in street name, if you came through your brokerage firm’s website and do not have your control number, you can gain access to the meeting by logging into your brokerage firm’s website site 15 minutes prior to the meeting start, selecting the shareholder communications mailbox to link through to the meeting and the control number will automatically populate. Please note that if you are a beneficial owner of our shares you cannot vote your shares at the Annual Meeting unless you have obtained a legal proxy from your Broker. Please contact your Broker for further information.

 

After the Annual Meeting, we will spend up to 15 minutes answering shareholder questions that comply with the meeting rules of conduct, which will be posted on the website above prior to the Annual Meeting. To the extent time doesn’t allow us to answer all of the appropriately submitted questions, we will answer them in writing on our investor relations website, at http://www.ocwen.com in the Shareholder Relations section, soon after the meeting and the answers will remain available until one week after posting. If we receive substantially similar questions, we will group such questions together and provide a single response to avoid repetition.

 

For technical assistance when logging into the virtual Annual Meeting, please call 800-586-1548 (US) or 303-562-9288 (International).

 

If you plan to attend the virtual Annual Meeting, we request you notify us no less than seven days in advance at shareholderrelations@ocwen.com (i.e. no later than May 20, 2020) to assist us in our preparations for the virtual meeting.

 

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This proxy statement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by a reference to a future period or by the use of forward-looking terminology. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Our business has been undergoing substantial change and we are in the midst of a period of significant capital markets volatility and experiencing significant changes within the mortgage lending and servicing ecosystem which has magnified such uncertainties. In addition, there is significant uncertainty relating to the economic impact of the global COVID-19 pandemic, including the response of the U.S. government, state governments, and regulators, and disruption in the financial markets. Readers should bear these factors in mind when considering such statements and should not place undue reliance on such statements. Forward-looking statements involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially. In the past, actual results have differed from those suggested by forward looking statements and this may happen again. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include those described in Ocwen’s reports and filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2019 and any current and quarterly reports since such date. Anyone wishing to understand Ocwen’s business should review our SEC filings. Ocwen’s forward-looking statements speak only as of the date they are made and we disclaim any obligation to update or revise forward-looking statements whether as a result of new information, future events or otherwise. Ocwen may post information that is important to investors on our website.

 

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ELECTION OF DIRECTORS

(Proposal One)

 

Our Bylaws provide that our Board of Directors shall consist of no less than three and no more than eleven members with the exact number to be fixed by our Board of Directors. Effective May 30, 2019, our Board of Directors fixed the number of directors at nine. Following the retirement of Robert A. Salcetti effective July 31, 2019, our Board has had eight directors. As Robert J. Lipstein has informed the Board of Directors that he does not intend to stand for re-election and is retiring from the Board of Directors immediately prior to the Annual Meeting, our Board of Directors has fixed the number of directors at seven, effective immediately prior to the commencement of the Annual Meeting.

 

As further described below under “Board of Directors and Corporate Governance” and, in particular, under “Annual Board Assessment” and “Director Nomination Process,” it is the responsibility of the Nomination/Governance Committee and the Board to periodically review Board size and composition and, if deemed appropriate, to make changes that the Board believes will best position the Board to enhance our ability to create value for shareholders and address changes in the market and business environment in which we operate.

 

Under the leadership of our Board, the Company demonstrated strong execution on our key strategic initiatives throughout 2019, including integrating PHH Corporation, growing our originations platform, re-engineering our cost structure, diversifying our funding sources, and fulfilling our regulatory commitments. The Company built a significant originations platform which includes all our channels for sourcing owned MSRs and subservicing, reduced costs and complexity through a legal entity reorganization in which we merged two of our licensed operating entities, Ocwen Loan Servicing, LLC and Homeward Residential, Inc., into PHH Mortgage Corporation, and completed the transition to the Black Knight Financial Services, Inc. LoanSphere MSP® servicing system. During the current highly challenging environment created by the global COVID-19 pandemic and related disruption in the financial markets and our industry, the Board remains committed to addressing our critical near-term challenges and positioning the Company to execute on our strategic priorities while maximizing value for our shareholders.

 

To put the Company in the best position to execute on these initiatives, the Nomination/Governance Committee and the Board evaluated the skillsets and experiential perspectives of our directors as well as individuals recommended as potential nominees and, consistent with our Board Diversity Policy and our Corporate Governance Guidelines, identified a set of director nominees with individual backgrounds that, when combined, provide a portfolio of experience and knowledge that will best serve the Company’s strategic and governance needs.

 

Our Board of Directors, upon the recommendation of the Nomination/Governance Committee, is proposing the seven nominees listed below for election as directors at the Annual Meeting. All nominees currently serve as our directors. There are no arrangements or understandings between any nominee and any other person for selection as a nominee.

 

Each of the nominees listed below has consented to being named in this proxy statement and to serving as a director, if elected. If any nominee is unable to or will not stand for election at the time of the Annual Meeting, the person or persons appointed as proxies will nominate and vote for a replacement nominee recommended by our Board of Directors or the Board of Directors may reduce the number of directors constituting the Board. As of the date of this proxy statement, our Board of Directors knows of no reason why any of the nominees would not be able or willing to serve as a director if elected.

 

Nominees for Director

 

The following sets forth certain information concerning our director nominees, including his or her principal occupation for at least the last five years, additional biographical information and specific qualifications of each director:

 

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Phyllis R. Caldwell. Ms. Caldwell became Chair of the Board of Directors on March 15, 2016. Ms. Caldwell has served as a director of Ocwen since January 2015. Ms. Caldwell is founder and managing member of Wroxton Civic Ventures, LLC, which provides advisory services on various financial, housing and economic development matters, a position she has held since January 2012. Previously, Ms. Caldwell was Chief, Homeownership Preservation Officer at the U.S. Department of the Treasury, responsible for oversight of the U.S. housing market stabilization, economic recovery and foreclosure prevention initiatives established through the Troubled Asset Relief Program, from November 2009 to December 2011. From December 2007 to November 2009, Ms. Caldwell was the President and Chief Executive Officer of the Washington Area Women’s Foundation. Prior to such time, Ms. Caldwell held various leadership roles in commercial real estate finance during her eleven years at Bank of America until her retirement from Bank of America in 2007, serving most recently as President of Community Development Banking. Since January 2014, Ms. Caldwell has served as an independent director of City First Bank of DC. Since October 2018, Ms. Caldwell has also served as a member of the board of directors of MicroVest Holdings, Inc. From January 2014 through September 2018, Ms. Caldwell served as an independent director of American Capital Senior Floating, Ltd. (NASDAQ: ACSF), a publicly traded business development company. Ms. Caldwell has also served on the boards of numerous non-profit organizations engaged in housing and community development finance. Ms. Caldwell received her Master of Business Administration from the Robert H. Smith School of Business at the University of Maryland, College Park and holds a Bachelor of Arts in Sociology, also from the University of Maryland.

 

Ms. Caldwell was selected to serve as a member of our Board of Directors due to her extensive experience in the housing and financial services industries, both in the private sector and as a senior government official, and her experience as a board member of another public company in the financial services industry.

 

Jenne K. Britell. Dr. Britell has served as a director of Ocwen since February 2019. Dr. Britell served as a director of United Rentals, Inc. from 2006 to 2019, including as its non-executive Chairman from 2008 to 2019. Dr. Britell also served as a director of Quest Diagnostics Inc., including as a member of its Audit and Finance Committee, from 2005 to 2019. From 2000 through 2017, Dr. Britell served as a director of Crown Holdings, Inc., including as Chairman of the Audit Committee. From 2001 to 2009, Dr. Britell was Chairman and Chief Executive Officer of Structured Ventures, Inc., advisors to U.S. and multinational companies. From 1996 to 2000, Dr. Britell was a senior executive of GE Capital. At GE Capital, she most recently served as the Executive Vice President of Global Consumer Finance and President of Global Commercial and Mortgage Banking. From January 1998 to July 1999, she was President and Chief Executive Officer of GE Capital, Central and Eastern Europe. Before joining GE Capital, she held significant management positions with Dime Bancorp, Inc., HomePower, Inc., Citicorp and Republic New York Corporation. Earlier, she was the founding Chairman and Chief Executive Officer of the Polish-American Mortgage Bank. Dr. Britell’s extensive prior board service also includes serving as Lead Director for Aames Investment Corp., as a trustee for the Teachers Insurance and Annuity Association (TIAA-CREF), including as a member of its Executive, Strategic Planning, and Mortgage Banking Committees, and as a director for Lincoln National Corp., including as a member of its Audit and Governance Committees, in addition to numerous civic and philanthropic boards.

 

Dr. Britell was selected to serve as a member of our Board of Directors due to her extensive executive and advisory experience, including in corporate governance, corporate finance, capital markets, international business and strategic planning, with multinational corporations operating in complex, regulated industries.

 

Alan J. Bowers. Mr. Bowers has served as a director of Ocwen since May 2015. Mr. Bowers has also served as a Director of Walker & Dunlop, Inc., a publicly traded commercial real estate finance company, since December 2010, serves as its Lead Director, and serves on its Audit Committee and its Nominating and Corporate Governance Committee (Chair). Mr. Bowers also serves on the board and as Audit Committee Chair of CorePoint Lodging Group, a publicly traded lodging REIT, and serves on its Nominating/Governance and Compensation Committees. From July 2013 to May 2018, Mr. Bowers served as a Director of La Quinta Inns & Suites, a publicly traded hotel chain. From 2006 to 2015, Mr. Bowers served as a Director of American Achievement Corp., a privately-held manufacturer and distributer of graduation products. Prior to Mr. Bowers’ retirement in 2005, he was the President and Chief Executive Officer and a board member of Cape Success, LLC, a private equity-backed staffing service and information technology solutions business, from 2001 to 2004. Mr. Bowers was also the President and Chief Executive Officer and a board member of MarketSource Corporation, a marketing and sales support service firm, from 2000 to 2001, and of MBL Life Assurance Corporation, a life insurance company, from 1995 to 1999. Mr. Bowers previously served on the boards and as Audit Committee Chair of Refrigerated Holdings, Inc., a temperature controlled logistics firm (from January 2009 to April 2013); Roadlink Inc., a trucking and logistics firm (from February 2010 to April 2013); and Fastfrate Holdings, Inc., a Canadian trucking and logistics firm (from July 2008 to June 2011), each a privately held company. Mr. Bowers has been a Certified Public Accountant since 1978 and served as Staff Auditor, Audit Partner and Managing Partner, serving a diverse client base during his tenure at Coopers & Lybrand, L.L.P. from 1978 to 1995 and as a Staff Accountant with Laventhol & Horwath, CPAs from 1976 to 1978. Mr. Bowers received his Bachelor of Science in Accounting from Montclair State University and his Master of Business Administration from St. John’s University.

 

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Mr. Bowers was selected to serve as a member of our Board of Directors because he brings to our Board over thirty years of experience in accounting and executive management, including experience on the audit committees of private companies and Securities and Exchange Commission registrants. Mr. Bowers’ accounting expertise and diverse corporate management experience are assets to our Board.

 

Jacques J. Busquet. Mr. Busquet has served as a director of Ocwen since January 2016. Mr. Busquet was formerly Chief Risk Officer and Managing Director of Natixis North America LLC and a member of the Executive Committee from April 2008 to February 2015. Prior to that, Mr. Busquet was Executive Vice President and member of the Executive Committee of Calyon Americas (formerly Credit Lyonnais Americas) in charge of Risks, Compliance, Legal, Regulatory Affairs and Asset Recovery from 1998 to March 2008. Since July 1, 2016, Mr. Busquet has served as a director of Mizuho Americas LLC, the US Bank Holding Company of Mizuho Financial Group, Inc. Since 2005, Mr. Busquet has served as a director of Prolitec Inc., a privately-held commercial air scenting company. From 2012 to March 2015, Mr. Busquet was a trustee of the Institute of International Bankers. From 2003 to 2009, Mr. Busquet was a trustee of the African Wildlife Foundation and the Chair of its Audit Committee for two years. Mr. Busquet has a Master of Business Administration in Finance from each of The Wharton School of the University of Pennsylvania and Hautes Études Commerciales (HEC), Paris.

 

Mr. Busquet was selected to serve as a member of our Board of Directors because with his broad experience as an officer in charge of risks in his prior positions, Mr. Busquet brings to our Board valuable insight into risk management and compliance issues. His experience working in financial institutions provides him with a deep understanding of the financial services industry. We also benefit from his corporate management experience.

 

Glen A. Messina. Mr. Messina has served as President and Chief Executive Officer and as a director of Ocwen since October 2018. He previously served as the President and Chief Executive Officer of PHH Corporation (“PHH”) from January 2012 to June 2017 and Chief Operating Officer of PHH from July 2011 to December 2011. Mr. Messina also served as a director of PHH from January 2012 to June 2017 and as a consultant to PHH through March 2018. Prior to joining PHH, Mr. Messina spent 17 years at General Electric Company (“GE”), most recently as Chief Executive Officer of GE Chemical and Monitoring Solutions, a global water and process specialty chemicals services business, from 2008 until July 2011.

 

Mr. Messina was selected to serve on our Board of Directors because of his extensive operational and leadership experience, including his service as both our President and Chief Executive Officer and his service as a director and the President and Chief Executive Officer of PHH.

 

DeForest B. Soaries Jr. Dr. Soaries has served as a director of Ocwen since January 2015. Dr. Soaries has served as Senior Pastor of First Baptist Church of Lincoln Gardens since 1990. He formerly served as New Jersey Secretary of State from 1999 to 2002 and as Chair of the United States Election Assistance Commission from 2004 to 2005. Dr. Soaries was a director of New Era Bank from 1996 to 1998. He currently serves as an independent director at Independence Realty Trust, a publicly traded real estate investment trust, a position he has held since February 2011 and is Chair of the Compensation Committee. Dr. Soaries has also served as an independent director of the Federal Home Loan Bank of New York since January 2009, where he is Chair of the Compensation and Human Resources Committee and also serves as a member of the Technology Committee and the Housing Committee. Dr. Soaries earned a Bachelor of Arts from Fordham University, a Master of Divinity from Princeton Theological Seminary and a Doctor of Ministry from United Theological Seminary.

 

Dr. Soaries was selected to serve as a member of our Board of Directors due to his experience in the financial services industry, including as a board member of a public financial services company. Dr. Soaries brings a unique perspective as a religious and community leader focused on the issues facing struggling borrowers and communities.

 

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Kevin Stein. Mr. Stein has served as a director of Ocwen since February 2019. He is a Senior Managing Director of EJF Capital LLC. From March 2017 to December 2019, Mr. Stein served as Chief Executive Officer of Resolution Analytica Corp., a buyer of commercial judgments. From March 2016 through March 2017, he served as Senior Managing Director of KCK US, Inc., a private equity firm. Mr. Stein was previously a Managing Director in the Financial Institutions Group of Barclays until 2016. Prior to joining Barclays in 2011, Mr. Stein was a Partner at FBR Capital Markets & Co. From 1994 to 2004, Mr. Stein was an executive of GreenPoint Financial Corporation, a bank holding company. Prior to joining GreenPoint in 1994, Mr. Stein was an Associate Director of the Federal Deposit Insurance Corporation, Division of Resolutions. Mr. Stein is the Audit Chair of Dime Community Bancshares, Inc., and has served as a director since December 2017. Mr. Stein also served as a director of PHH from June 2017 until its acquisition by the Company in October 2018. Mr. Stein is also a director and Chair of the Audit Committee of Bedford Stuyvesant Restoration Corporation.

 

Mr. Stein was selected to serve as a member of our Board of Directors due to his knowledge regarding the financial services industry and his mortgage servicing experience, including his prior service as a director of PHH.

 

Retiring Director

 

Robert J. Lipstein. Mr. Lipstein has served as a director of Ocwen since March 2017. Since May 2019, Mr. Lipstein has served as a board member and the Audit Committee Chair of Seacoast Banking Corp. Mr. Lipstein was formerly a partner with KPMG LLP and served as the Global IT Partner in Charge of Business Services from 2014 to 2016 and as an Advisory Business Unit Partner in Charge for its Mid-Atlantic Region from 2009 to 2014. His career at KPMG LLP began in 1977. In January 2017, he became a director at CrossCountry Consulting, a privately-held consulting firm that focuses on corporate advisory services. Since January 2013, he has served as an Advisory Board Member of the Weinberg Center for Corporate Governance at the University of Delaware. Mr. Lipstein has a Bachelor of Science in Accounting from the University of Delaware.

 

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS

THAT YOU VOTE “FOR ALL” OF THE NOMINEES FOR DIRECTOR.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

Role of the Board of Directors

 

The Board of Directors plays an active role in overseeing management and representing the interests of the shareholders. Each director is expected to dedicate sufficient time, energy and attention to ensure diligent performance of his or her duties, including by attending annual meetings of the shareholders of the Company, and meetings of the Board and Committees of which he or she is a member.

 

Our Board of Directors held 14 meetings and acted by unanimous written consent six times in 2019. Each incumbent director who served as a director during 2019 attended at least 75% of the aggregate of these meetings and all meetings held by all committees of our Board of Directors on which he or she served during 2019. Directors are expected to attend the annual meeting of shareholders (including via electronic participation) and a director who is unable to attend is expected to notify the Company Secretary in advance of such meeting. Our 2019 Annual Meeting of Shareholders was attended by all directors in office on the date thereof.

 

Director Independence

 

Our Corporate Governance Guidelines provide that a majority of our Board of Directors must be independent in accordance with the listing standards of the New York Stock Exchange.

 

Our Nomination/Governance Committee and the Board of Directors review independence upon appointment and annually review the direct and indirect relationships that each director has with Ocwen based in part on responses provided by our directors to a questionnaire that incorporates the independence standards established by the New York Stock Exchange. Only those directors who satisfy the independence standards and who are determined by our Board of Directors to have no material relationship with Ocwen (either directly or as a partner, shareholder or officer of an organization that has a relationship with Ocwen) are considered independent. Following the Nomination/Governance Committee’s review and findings, the Nomination/Governance Committee and our Board of Directors have affirmatively determined that Ms. Caldwell, Messrs. Bowers, Busquet, and Stein, and Drs. Britell and Soaries are independent directors. In addition, our Board of Directors has previously determined that Mr. Salcetti, who served as a director through July 31, 2019, qualified as an independent director, and Mr. Lipstein, who is retiring immediately prior to the Annual Meeting, is an independent director.

 

Annual Board Evaluation

 

Our Corporate Governance Guidelines and Nomination/Governance Committee Charter provide that the Nomination/Governance Committee will oversee an annual self-assessment of the performance of the Board of Directors as a whole and the performance of each committee of the Board of Directors. The evaluations are designed to assess whether the Board of Directors and its committees function effectively and make valuable contributions and to identify opportunities for improving their operations and procedures. Our 2019 performance self-assessments were conducted in the first quarter of 2020.

 

Board Leadership Structure

 

The Board of Directors believes that separating the positions of Chief Executive Officer and Chair of the Board of Directors is the best structure to fit the Company’s needs at this time. However, our Board of Directors does not believe that it is in the best interests of the Company and our shareholders to mandate the separation of the offices of Chair of the Board of Directors and Chief Executive Officer. Rather, our Board of Directors retains the discretion to make determinations on this matter from time to time as may be in the best interests of the Company and our shareholders. As Chair of the Board, Ms. Caldwell leads the Board of Directors and oversees Board meetings and the delivery of information necessary for the Board’s informed decision-making. As our President and Chief Executive Officer, Mr. Messina is responsible for our day-to-day operations and for formulating and executing our long-term strategies in collaboration with the Board of Directors.

 

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Committees of the Board of Directors

 

Our Board of Directors has the following standing committees: an Audit Committee, a Compensation and Human Capital Committee, a Nomination/Governance Committee, a Risk and Compliance Committee, and an Executive Committee. The table below lists the current members of each of these committees. A brief description of each committee is provided below the table.

 

Name  Age(1) 

Director

Since

 

Audit

Committee

 

Compensation and Human Capital

Committee

 

Nomination/

Governance

Committee

 

Risk and Compliance

Committee

 

Executive

Committee

Alan J. Bowers  65  2015  X(2)        X   
Jacques J. Busquet  71  2016     X     X(2)  X
Jenne K. Britell  77  2019     X  X      
Phyllis R. Caldwell  60  2015        X(2)     X(2)
Robert J. Lipstein(3)  64  2017  X            
Glen A. Messina  58  2018              X
DeForest B. Soaries, Jr.  68  2015     X(2)  X      
Kevin Stein  58  2019  X        X   

 

(1) As of April 15, 2020

(2) Committee Chair

(3) In connection with his retirement from our Board of Directors at the Annual Meeting, Mr. Lipstein will step down from his membership on the Audit Committee.

 

Audit Committee. The Audit Committee of our Board of Directors oversees the relationship with our independent registered public accounting firm, and reviews and advises our Board of Directors with respect to matters involving accounting, auditing, and financial reporting, among other things. Audit Committee oversight also includes the evaluation of significant matters relating to the financial reporting process and our system of internal accounting controls. The Audit Committee also provides oversight of the internal audit function and is responsible for ensuring the Company has appropriate procedures in place for the receipt and review of confidential and anonymous reports of questionable accounting or auditing matters. Additionally, the Audit Committee reviews the scope and results of the annual audit conducted by the independent registered public accounting firm.

 

The current members of the Audit Committee are Messrs. Bowers (Chair), Lipstein and Stein. Each member of our Audit Committee (i) is independent as independence for audit committee members is defined in the listing standards of the New York Stock Exchange and applicable rules of the Securities and Exchange Commission, (ii) is financially literate, (iii) possesses accounting or related financial management expertise within the meaning of the listing standards of the New York Stock Exchange and (iv) qualifies as an audit committee financial expert, as such term is defined in the applicable rules of the Securities and Exchange Commission. No current member of the Audit Committee serves on the audit committee of more than three other public companies.

 

Our Audit Committee operates under a written charter approved by our Board of Directors, a copy of which is available on our website at www.ocwen.com. The Audit Committee generally reviews its charter annually and occasionally reviews it more frequently. When circumstances require, the charter is amended and the revised version posted on our website. This Committee met 11 times in 2019.

 

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Compensation and Human Capital Committee. The Compensation and Human Capital Committee (Compensation Committee) of our Board of Directors oversees our compensation and employee benefit plans and practices. In furtherance thereof, the Compensation Committee reviews and approves corporate goals and objectives relevant to the compensation of our executive officers, including the President and Chief Executive Officer, evaluates our executive officers’ performance in light of those goals and objectives and approves our executive officers’ compensation based on their evaluations. In addition, the Compensation Committee oversees the review and approval of awards made to our non-executive officer employees that participate in our cash and equity incentive programs. The Compensation Committee is empowered to review and to administer awards under the 2007 Equity Incentive Plan, under which no new awards may be granted but previously granted awards remain outstanding, and the 2017 Performance Incentive Plan. The Compensation Committee has the authority to retain, at the Company’s expense, compensation consultants, independent counsel or other advisers as it deems necessary in connection with its responsibilities. The Compensation Committee may form and delegate authority to subcommittees when it deems it to be appropriate. The role of the Compensation Committee and our processes and procedures for the consideration and determination of executive and director compensation are described in more detail below under “Board of Directors Compensation” and “Compensation Discussion and Analysis,” respectively.

 

The current members of the Compensation Committee are Dr. Soaries (Chair), Mr. Busquet and Dr. Britell. Each of these directors is independent as independence for Compensation Committee members is defined in the listing standards of the New York Stock Exchange. In addition, each member of the Compensation Committee also qualifies as a “non-employee” director as defined in Rule 16b-3 of the Securities and Exchange Commission and as an “outside” director within the meaning of Section 162(m) of the Internal Revenue Code (the “Code”).

 

Our Compensation Committee operates under a written charter approved by our Board of Directors, a copy of which is available on our website at www.ocwen.com. The Compensation Committee generally reviews its charter annually and occasionally reviews it more frequently. When circumstances require, the charter is amended and the revised version posted on our website. This Committee met nine times in 2019.

 

Compensation Committee Interlocks and Insider Participation. Dr. Soaries, Messrs. Busquet and Lipstein, and Dr. Britell served as members of the Compensation Committee during 2019. None of such members were, at any time during the 2019 fiscal year or at any previous time, an officer or employee of the Company. None of our executive officers have served on the Board of Directors or Compensation Committee of any other entity that has or had one or more executive officers who served as a member of our Board of Directors or our Compensation Committee during the 2019 fiscal year. No member of the Compensation Committee had any relationship with us requiring disclosure under Item 404 of Securities and Exchange Commission Regulation S-K.

 

Nomination/Governance Committee. The Nomination/Governance Committee of our Board of Directors makes recommendations to our Board of Directors of candidates to serve as Directors and Committee members for our Board of Directors, advises our Board of Directors with respect to director composition, procedures and committees, recommends a set of corporate governance principles to our Board and oversees the evaluation of our Board of Directors and our management.

 

The current members of the Nomination/Governance Committee are Ms. Caldwell (Chair) and Drs. Britell and Soaries. Each member of our Nomination/Governance Committee is independent as defined in the listing standards of the New York Stock Exchange.

 

Our Nomination/Governance Committee operates under a written charter approved by our Board of Directors, a copy of which is available on our website at www.ocwen.com. The Nomination/Governance Committee generally reviews its charter annually and occasionally reviews it more frequently. When circumstances require, the charter is amended and the revised version posted on our website. This Committee met 13 times in 2019.

 

Risk and Compliance Committee. The Risk and Compliance Committee of our Board of Directors provides assistance to the Board of Directors with (i) review of risks that could affect the ability of the Company to achieve its strategies and preserve its assets, (ii) oversight of an enterprise risk management infrastructure to identify, measure, monitor and report on the risks the Company faces, (iii) oversight of our compliance function, including our compliance management system, and (iv) oversight of our compliance with applicable laws, rules and regulations governing our consumer-oriented businesses, including Federal consumer financial laws and applicable state laws. The Risk and Compliance Committee also provides assistance to the Board of Directors with the review, approval and oversight of related party transactions pursuant to our Related Party Transactions Approval Policy.

 

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The current members of the Risk and Compliance Committee are Messrs. Busquet (Chair) and Messrs. Bowers and Stein, all of whom are independent directors as defined in the listing standards of the New York Stock Exchange.

 

Our Risk and Compliance Committee operates under a written charter approved by our Board of Directors, a copy of which is available on our website at www.ocwen.com. The Risk and Compliance Committee generally reviews its charter annually and occasionally reviews it more frequently. When circumstances require, the charter will be amended and the revised version posted on our website. This Committee met eight times in 2019.

 

Executive Committee. Our Executive Committee is generally responsible to act on behalf of our Board of Directors during the intervals between meetings of our Board of Directors, if necessary. The current members of the Executive Committee are Ms. Caldwell (Chair) and Messrs. Messina and Busquet.

 

Other Committees. Our Board of Directors has the authority to form additional standing or temporary committees, and delegate appropriate authority to such committees if and when the Board determines that it is advisable to do so. In addition, the Board may, from time to time, determine that a standing committee should be dissolved or re-organized in order to more efficiently serve the Company’s corporate governance needs.

 

Director Nomination Process

 

The Nomination/Governance Committee periodically assesses the appropriate size and composition of the Board of Directors, including whether any vacancies on the Board of Directors are anticipated. If vacancies are anticipated, various potential candidates for director are identified. Candidates may come to the attention of the Nomination/Governance Committee through current members of the Board of Directors, professional search firms, shareholders or industry sources.

 

Since January 1, 2015, the Nomination/Governance Committee has recommended, and the Board of Directors has appointed, eight new independent directors, including three new independent directors appointed in 2015, two new independent directors appointed in 2016, one new independent director appointed in 2017, and two new independent directors appointed in 2019. Effective May 30, 2019, our Board of Directors fixed the number of directors at nine. Following the retirement of Mr. Salcetti effective July 31, 2019, our Board has had eight directors. As Mr. Lipstein has informed the Board of Directors that he does not intend to stand for re-election and is retiring from the Board of Directors immediately prior to the Annual Meeting, our Board of Directors has fixed the number of directors at seven, effective immediately prior to the commencement of the Annual Meeting.

 

In evaluating nominees for Director, our Nomination/Governance Committee takes into account the applicable requirements for directors under the rules of the Securities and Exchange Commission and the listing standards of the New York Stock Exchange. In addition, our Nomination/Governance Committee takes into account such factors as experience, knowledge, skills, expertise, integrity, diversity, ability to make independent analytical inquiries, understanding of the Company’s business environment and willingness and ability to devote adequate time and effort to Board responsibilities and the interplay of the candidate’s qualifications and experience with the qualifications and experience of other members of our Board of Directors. In February 2019, we revised our prior policy that directors who have reached the age of 78 may generally not be nominated, as we believe it is more beneficial to focus on the qualifications, experience, and performance of our directors and director nominees and consider Board refreshment from a broader perspective than the age of individual directors. We also consider the number of other boards on which a nominee sits. The Company’s general policy is to limit the number of other public company boards of directors upon which a director may sit to four. The Board of Directors retains discretion to appoint or nominate for election by the shareholders individuals who sit on more than four other public company boards of directors if the Board of Directors considers the addition of such individual to the Board of Directors to be in the best interests of the Company and its shareholders. Our Nomination/Governance Committee evaluates all of the factors outlined above, as well as any other factors it deems to be appropriate, and recommends candidates that it believes will enhance our Board of Directors and benefit the Company and our shareholders. It is the policy of our Nomination/Governance Committee to consider candidates for director recommended by shareholders, but the Nomination/Governance Committee has no obligation to recommend such candidates. A copy of our Corporate Governance Guidelines is available on our website at www.ocwen.com.

 

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Pursuant to the Board of Director’s Diversity Policy, the Nomination/Governance Committee considers diversity when it recommends director nominees to the Board of Directors. We view diversity in an expansive way to include differences in prior work experience, viewpoint, education and skill set. In particular, the Nomination/Governance Committee considers diversity in professional experience, skills, expertise, training, broad-based business knowledge and understanding of the Company’s business environment when recommending director nominees to the Board of Directors with the objective of achieving a Board with diverse business and educational backgrounds. In addition, the Board recognizes the value of including perspectives shaped by diverse ethnicities, geographic origins and genders in building an inclusive corporate culture that reflects and supports Ocwen’s diverse customer base and global workforce. Board members should have individual backgrounds that, when combined, provide a portfolio of experience and knowledge that will serve the Company’s strategic and governance needs. The Nomination/Governance Committee reviews the skills and attributes of Board members within the context of the current make-up of the full Board of Directors from time-to-time, as appropriate. The Nomination/Governance Committee does not discriminate against candidates for the Board of Directors based on race, color, religion, sex, sexual orientation or national origin.

 

In evaluating a particular candidate, the Nomination/Governance Committee will consider factors other than the candidate’s qualifications, including the current composition of the Board of Directors, the balance of management and independent directors, the need for Audit Committee and other expertise and the evaluations of other prospective nominees. In connection with this evaluation, the Nomination/Governance Committee determines whether to interview the prospective nominee, and if warranted, one or more members of the Nomination/Governance Committee, and others as appropriate, interview prospective nominees. After completing this evaluation and interview process, the Nomination/Governance Committee makes a recommendation to the full Board of Directors as to the persons who should be nominated by the Board of Directors. The Board of Directors determines the nominees after considering the recommendation of the Nomination/Governance Committee. Should a shareholder recommend a candidate for Director, our Nomination/Governance Committee would evaluate such candidate in the same manner that it evaluates any other nominee. To date, no shareholder or group of shareholders has put forth any director nominees for the Annual Meeting.

 

If you wish to recommend persons for consideration by our Nomination/Governance Committee as nominees for election to our Board of Directors, you may do so by written notice to our Secretary at Ocwen Financial Corporation, 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409. Such notice must contain all the information set forth in Section 2.2 of our Bylaws and comply with the procedures and deadline set forth therein. See “Submission of Shareholder Proposals for 2021 Annual Meeting,” below for additional information about this process.

 

Prohibition against Short Sales, Hedging and Margin Accounts

 

Our Insider Trading Prevention Policy prohibits any director, officer or employee from engaging in any short sale of the Company’s stock, establishing and using a margin account with a broker-dealer for the purpose of buying or selling Company stock, pledging Company securities as collateral for a loan, buying or selling puts or calls on the Company’s stock, or engaging in any other transaction that hedges the economic risk associated with ownership of the Company’s securities. This policy is designed to encourage investment in the Company’s stock for the long term, on a buy and hold basis, and to discourage active trading or short-term speculation and applies regardless of whether such Company securities were (i) granted to the director, officer or employee as part of their compensation or (ii) held directly or indirectly by the director, officer or employee.

 

Corporate Governance Guidelines

 

The Corporate Governance Guidelines adopted by our Board of Directors provide guidelines for us and our Board of Directors to help ensure effective corporate governance. The Corporate Governance Guidelines cover topics such as director qualifications, board of director and committee composition, director responsibilities, director access to management and independent advisers, director compensation, director orientation and continuing education, management succession and annual performance appraisal of the Board of Directors.

 

Our Corporate Governance Guidelines are available on our website at www.ocwen.com. Our Nomination/Governance Committee reviews our Corporate Governance Guidelines annually and recommends amendments to the Board of Directors for approval.

 

The Board of Directors has also adopted a Clawback Policy as further described under “Clawback Policy” in the “Executive Compensation” section below.

 

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Executive Sessions of Non-Management Directors

 

Ms. Caldwell chairs executive sessions of the full Board of Directors. Our non-management directors met in executive sessions of the full Board without management during seven meetings in 2019. In addition, our Audit and Risk and Compliance Committees generally met in executive session at each regularly scheduled quarterly meeting and on other occasions when the members believed it was advisable to do so.

 

Meetings with Management Independent of the Chief Executive Officer

 

Our Chair, the chairs of our committees and our other directors meet with various members of management, without the Chief Executive Officer present, to discuss matters relevant to the business of the Company. For example, in addition to discussions with members of senior management, the chair of the Audit Committee meets independently with the Chief Audit Executive, our independent auditors and the General Counsel from time to time and the chair of the Risk and Compliance Committee meets independently with the Chief Risk and Compliance Officer and the General Counsel from time to time. Our directors have also visited various of our U.S. and international sites to meet generally with employees and senior management in those locations.

 

Communications with Directors

 

If you desire to communicate with our Board of Directors or any individual director regarding Ocwen, you may do so by writing to our Secretary at Ocwen Financial Corporation, 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409. You may communicate anonymously or confidentially and may also indicate whether you are a shareholder, customer, supplier, or other interested party.

 

You may also write to our Board of Directors through our website at http://shareholders.ocwen.com/contactBoard.cfm.

 

Shareholders and other interested parties may communicate directly with the Audit Committee and the non-management directors of the Board of Directors by calling our hotline, which is administered by a third party, at 1-800-884-0953. The Chair of the Audit Committee has been designated to receive such communications.

 

Communications received in writing are distributed to our Board of Directors or to individual directors, as the General Counsel and Secretary deem appropriate, depending on the facts and circumstances outlined in the communication received. In that regard, the Board of Directors has requested that certain items that are unrelated to the duties and responsibilities of the Board of Directors should be excluded, such as:

 

  Service or product complaints
  Service or product inquiries
  New service or product suggestions
  Resumes and other forms of job inquiries
  Surveys
  Business solicitations or advertisements

 

In addition, material that is unduly hostile, threatening, illegal, repetitive, irrelevant to the Board of Directors or similarly unsuitable will be excluded, provided that any communication that is filtered out will be made available to any non-management director upon request.

 

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Code of Ethics

 

We have adopted a Code of Business Conduct and Ethics that applies to our directors, officers and employees as required by the New York Stock Exchange rules. We have also adopted a Code of Ethics for Senior Financial Officers that applies to our Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer. Any waivers from either the Code of Business Conduct and Ethics or the Code of Ethics for Senior Financial Officers must be approved by our Board of Directors or a Board Committee and must be promptly disclosed. The Code of Business Conduct and Ethics and the Code of Ethics for Senior Financial Officers are available on our web site at www.ocwen.com. Any amendments to the Code of Business Conduct and Ethics or the Code of Ethics for Senior Financial Officers, as well as any waivers that are required to be disclosed under the rules of the Securities and Exchange Commission or the New York Stock Exchange, will be posted on our website.

 

Risk Management and Oversight Process

 

One of our Board of Directors’ key responsibilities is the oversight of risk associated with the Company. Certain of these responsibilities have been delegated to specific Committees, in which case the Board oversees the work of the Committee. As discussed above, our Risk and Compliance Committee is responsible for monitoring the Company’s enterprise risk management framework, and regularly meets with the Chief Risk and Compliance Officer to discuss risk exposures and mitigation plans. This Committee monitors the Company’s evaluation and management of risks, including operational risk, regulatory compliance risks and cybersecurity risks, through reviews with management and it reviews and approves related party transactions. The Audit Committee monitors the Company’s financial risks through regular reviews of the Company’s financial activities with management and internal and external auditors. The Nomination/Governance Committee monitors the Company’s governance risk by regular review with management. The Compensation Committee monitors the Company’s compensation policies and related risks by regular reviews with management. The Board of Directors’ role in risk oversight is consistent with the Company’s leadership structure with the President and Chief Executive Officer and other members of senior management, including our Chief Risk and Compliance Officer, having responsibility for assessing and managing the Company’s risk exposure, and the Board of Directors and its Committees providing oversight in connection with these efforts.

 

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BOARD OF DIRECTORS COMPENSATION

 

The following table discloses compensation received for fiscal year 2019 by each member of our Board of Directors who was not employed by us or one of our subsidiaries and who served as a director during fiscal year 2019 (our “non-management directors”).

 

Name 

Fees Earned

Or Paid in Cash

($)

  

Stock

Awards(1)(2)(3)

($)

  

Total

($)

 
Phyllis R. Caldwell   176,000    100,000    276,000 
Jenne K. Britell (4)   74,460    125,205    199,665 
Alan J. Bowers   123,500    100,000    223,500 
Jacques J. Busquet   124,500    100,000    224,500 
Carol J. Galante (5)   38,118        38,118 
Robert J. Lipstein   103,651    100,000    203,651 
Robert A. Salcetti (6)   62,686    100,000    162,686 
DeForest B. Soaries, Jr.   112,000    100,000    212,000 
Kevin Stein (4)   79,657    125,205    204,862 

 

(1) Amounts reported for stock awards represent the aggregate grant date fair value of awards granted during fiscal 2019 under the 2017 Performance Incentive Plan (the “2017 Plan”) computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. We based the grant date fair value of stock awards on the closing price of our common stock on the New York Stock Exchange on the date of grant of the awards.
   
(2) On May 30, 2019, our non-management directors received equity awards under the 2017 Plan for their service for the 2019-2020 term. Each award had a grant date fair value totaling $100,000 (with immaterial incremental value resulting from rounding to the next whole share). Each director received 62,500 restricted stock units (“RSUs”) vesting May 30, 2020 in the event each director attends at least 75% of applicable Board and committee meetings.
   
(3) Our non-management directors have no shares subject to option awards or other equity awards outstanding as of December 31, 2019, other than the RSUs issued May 30, 2019, except the following issued in prior service years to directors deferring their equity compensation pursuant to the Deferral Plan for Directors: Mr. Salcetti held 79,348 RSUs deliverable January 31, 2020 (six months following the termination of his service), and Dr. Soaries holds 12,240 RSUs deliverable six months following the termination of his service and 19,901 RSUs deliverable on January 1, 2023.
   
(4) On February 28, 2019, the Board appointed Dr. Britell and Mr. Stein to the Board of Directors and granted each a pro-rated equity award with a grant date fair value of $25,205 corresponding to the period between the date of their appointment and the date of the 2019 Annual Meeting. Each of Dr. Britell and Mr. Stein received 11,778 RSUs which vested on May 30, 2019.
   
(5) Ms. Galante retired effective May 30, 2019 immediately prior to the 2019 Annual Meeting. Accordingly, she did not receive a 2019 equity award for 2019-2020 director service.
   
(6) Mr. Salcetti retired effective July 31, 2019. As described in Note (2), above, director equity awards will vest May 30, 2020. Under the terms of the awards, a director who retires mid-year must attend 75% of the combined total of (i) Board meetings that occurred while he or she served on the Board during 2019 and (ii) the total number of meetings during 2019 for committees on which the director served immediately prior to retirement. If the 75% threshold is not met, the award will vest in the same proportion as the director’s attendance. Since presently unscheduled meetings may occur from the date of this Proxy Statement through May 30, 2020, it is not possible to determine what percentage of Mr. Salcetti’s $100,000 stock award will vest.

 

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Standard Compensation Arrangements for Non-Management Directors

 

The Compensation Committee has the responsibility for determining the form and amount of compensation for our non-management directors. Mr. Messina, our management director, does not receive an annual retainer or any other compensation for his service on the Board of Directors. Non-management directors receive the following compensation for their services on the Board of Directors.

 

Cash Compensation

 

In 2019, we provided the following annual cash compensation to our non-management directors in quarterly installments (except as noted below):

 

  a retainer of $80,000;
  an additional $75,000 to the Chair of the Board;
  an additional $25,000 to the Audit Committee, Compensation Committee, and Risk and Compliance Committee Chairs;
  an additional $15,000 to the Nomination/Governance Committee Chair; and
  an additional $12,500 to all Audit Committee, Compensation Committee, and Risk and Compliance Committee members (other than the Chairs).

 

In addition, our directors receive per-meeting fees of $1,000 per meeting for each meeting in excess of eight meetings of the Board of Directors a year. Similarly, each member of the Compensation Committee receives an additional $1,000 for attending each meeting of the Compensation Committee in excess of eight annually. Our other committee members are not compensated on a per-meeting basis.

 

Our 2019 Board of Directors fee structure reflects the determination of our Compensation Committee to reduce the cash component of directors’ annual retainer fee from $100,000 to $80,000 and to reduce compensation for service as chair of the Audit, Compensation and Risk & Compliance committees from $30,000 to $25,000, in each case effective as of January 1, 2019.

 

Effective February 10, 2020, the Compensation Committee determined to increase annual compensation for service as Chair of the Board from $75,000 to $100,000.

 

Equity Compensation

 

At our 2017 Annual Shareholder Meeting, our shareholders approved the 2017 Performance Incentive Plan (the “2017 Plan”). Following the 2019 Annual Shareholder Meeting, each non-management member of the Board of Directors was granted an award of restricted stock units (“RSUs”) under the 2017 Plan with a grant date fair value of $100,000 (rounded to the next whole share). The RSUs vest on the one-year anniversary of grant if the director has attended an aggregate of at least 75% of all meetings of the Board of Directors and committees of which the director is a member during such period. Upon vesting, the shares of common stock underlying the RSUs will be issued to the director unless the director has elected to defer delivery in accordance with the Deferral Plan for Directors, as described below. In the event that the director has attended less than an aggregate of at least 75% of all such meetings, such director’s right to ownership will vest on a pro rata basis according to the director’s actual attendance percentage, with the remaining shares forfeited. RSUs are generally non-transferable, confer no voting rights in the underlying shares prior to delivery, and no adjustments will be made for dividends for which the record date is prior to the date of issuance of such shares.

 

Following our 2020 Annual Shareholder Meeting on May 27, 2020, each non-management member of the Board of Directors will again be granted an equity award with a grant date fair value of $100,000 (rounded to the next whole share), subject to their election to defer, as described further below. In the event we have an insufficient number of shares remaining available under the 2017 Plan at the time of the Annual Meeting, directors will be granted the right to receive cash to the extent of the available share shortfall. Payment of any cash amounts will be made on May 27, 2021 subject to the same vesting and other conditions as the RSUs.

 

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Deferral Plan for Directors

 

The Ocwen Financial Corporation Deferral Plan for Directors provides non-management directors with the opportunity to defer the receipt of all or a portion of their equity compensation earned for their service as directors. The plan is administered by the Compensation Committee. Before the end of each calendar year (or, in the case of directors appointed between Annual Meetings, within 30 days of appointment), the non-management directors make an election to defer delivery of either all or a portion of the equity portion of their annual compensation for the following grant year. Directors electing to defer receipt of equity will become vested in the shares underlying a deferred equity award and will receive dividend equivalents to the same extent as they would if the original award had not been deferred.

 

Each director electing deferral must specify the payment date at the time of election for any shares underlying a deferred award as either (i) the six-month anniversary of the director’s termination date or (ii) any other date elected by the director which is at least two years after the last day of the year of service for which the compensation was awarded. At least thirty days prior to payment of deferred compensation, a director shall elect to receive such payment in the form of either (i) cash in an amount equal to the fair market value of the shares underlying the deferred equity award, or (ii) the shares of common stock underlying the deferred equity award.

 

Other Compensation Matters

 

Director compensation may be prorated for a director serving less than a full one-year term such as in the case of a director joining the Board of Directors after an annual meeting of shareholders. Directors are reimbursed for reasonable travel and other expenses incurred in connection with performing their duties, including attending meetings of the Board of Directors and its committees. Director compensation is subject to review and adjustment by the Compensation Committee from time to time.

 

 20 

 

 

EXECUTIVE OFFICERS

 

The following table sets forth certain information with respect to each person who currently serves as one of our executive officers. Our executive officers are appointed by our Board of Directors and generally serve at the discretion of our Board of Directors. There are no arrangements or understandings between us and any person for the appointment of any person as an executive officer. None of our directors and/or executive officers is related to any other director and/or executive officer of Ocwen or any of its subsidiaries by blood, marriage or adoption.

 

Name   Age(1)   Position(1)
Glen A. Messina   58   President and Chief Executive Officer
Scott W. Anderson   51   Executive Vice President and Chief Servicing Officer
John V. Britti   60   Executive Vice President and Chief Investment Officer
June C. Campbell   62   Executive Vice President and Chief Financial Officer
Albert J. Celini   57   Executive Vice President and Chief Risk and Compliance Officer
Francois Grunenwald   49   Senior Vice President and Chief Accounting Officer
Joseph J. Samarias   48   Executive Vice President, General Counsel and Company Secretary
Arthur C. Walker, Jr.   48   Senior Vice President, Global Tax
Timothy J. Yanoti   57   Executive Vice President and Chief Growth Officer
Dennis Zeleny   64   Executive Vice President and Chief Administrative Officer

 

(1) All age and position information set forth herein is as of April 15, 2020.

 

The principal occupation for at least the last five years, as well as certain other biographical information, for each of our executive officers who is not a director is set forth below.

 

Scott W. Anderson. Mr. Anderson has served as Executive Vice President and Chief Servicing Officer since 2009, and his career with Ocwen has spanned over twenty years. Prior to his current role, he served as Senior Vice President, Residential Assets since November 2001. Prior to joining Ocwen in November 1993, Mr. Anderson was employed by CIGNA. He holds a Bachelor of Arts in Economics from Bowdoin College.

 

John V. Britti. Mr. Britti has served as Executive Vice President and Chief Investment Officer since June 2014. From July 1, 2018 through October 3, 2018, he also served as interim Chief Executive Officer. From September 2016 to February 2017, he served as the Interim Head of Risk Management. He previously served as Chief Financial Officer from March 2012 to June 2014 and Executive Vice President of Ocwen responsible for Finance and Business Development from January 2011 to March 2012. He has been with Ocwen since January 2011. Prior to joining Ocwen, Mr. Britti was Chief Operating Officer for mortgage insurer RMIC from 2005 to 2011. Mr. Britti held two positions at Freddie Mac as a Vice President running Field Sales and Pricing & Structured Transactions. Mr. Britti has also been a Vice President at Capital One running Thrift and Mortgage Operations. After business school, Mr. Britti worked at McKinsey & Company in its financial services industry group. He holds a Bachelor of Arts in Economics from the University of Maryland and a Master of Business Administration from Dartmouth’s Amos Tuck School.

 

June C. Campbell. Ms. Campbell has served as Executive Vice President and Chief Financial Officer since March 2019. Ms. Campbell joined Ocwen from GE Capital, the financial services unit of General Electric Company, where she held multiple senior management positions in Finance, Capital Markets and Operations during her more than 20-year career at the company. Most recently, she served as Managing Director, Global Capital Markets, a position she held since 2014. Ms. Campbell’s prior roles included serving as Chief Operating Officer for GE Capital Canada from 2011 to 2014 and Chief Financial Officer of GE Capital Real Estate Canada from 2008 to 2011. She holds a Bachelor of Science from Simmons College and a Master of Business Administration from the University of Chicago.

 

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Albert J. Celini. Mr. Celini has served as Executive Vice President and Chief Risk and Compliance Officer since May 2019. From the closing of Ocwen’s acquisition of PHH Corporation in October 2018 until May 2019, he served as Senior Vice President and Chief Risk and Compliance Officer. From November 2017 through October 2018, he served as the Chief Risk and Compliance Officer of PHH Corporation. From May 2017 through October 2018, he served as a risk management consultant to the mortgage industry with Newbold Advisors LLC, a professional services firm, and from June 2016 through April 2017, with Common Securitization Solutions LLC (a joint venture between Fannie Mae and Freddie Mac). He also previously held executive roles at Sun National Bank, Freddie Mac, and Ally Bank (formerly GMAC Bank). Mr. Celini is a Certified Public Accountant and received a Bachelor of Science in Accounting from Fordham University.

 

Francois Grunenwald. Mr. Grunenwald has served as our Senior Vice President and Chief Accounting Officer since August 2019. Prior to joining Ocwen, he spent the prior 20 years at PricewaterhouseCoopers, where he served in various accounting and financial advisory roles with a focus on financial services clients, including for the last 12 years as a Partner. Mr. Grunenwald is a Certified Public Account and holds a Master’s degree in Finance and Banking from the University of Paris II Panthéon-Assas.

 

Joseph J. Samarias. Mr. Samarias has served as Executive Vice President and General Counsel since April 2019. He previously served as Senior Vice President, Deputy General Counsel of Ocwen since 2013. He also serves as the Company’s Chief Ethics Officer, and was appointed Company Secretary in April 2020. Prior to joining Ocwen, from 2009 to 2013, Mr. Samarias was a senior attorney with the Treasury Department’s Office of Financial Stability (“OFS”). From 2012 to 2013, he served as Chief Counsel of OFS where he was responsible for directing all legal activities of the Troubled Asset Relief Program, and served as the chief legal advisor to the Assistant Secretary for Financial Stability. Prior to his government service, Mr. Samarias was a litigator with several international law firms from 1997 to 2009. He holds a Bachelor of Arts from Vanderbilt University, a Juris Doctor from Washington University School of Law, and is a member of the bars of the Commonwealth of Virginia and the District of Columbia, as well as a Florida Authorized House Counsel, and a New Jersey In-House Counsel.

 

Arthur C. Walker, Jr. Mr. Walker serves as our Senior Vice President, Global Tax and has been with Ocwen since August 2013. In that capacity he leads all the tax department functions for Ocwen. Mr. Walker has over nineteen years of tax experience advising public companies on domestic and international tax matters. Prior to joining Ocwen, Mr. Walker was a tax partner with the law firm of Mayer Brown LLP and had been with Mayer Brown for fourteen years. Mr. Walker has advised companies in many different industries throughout his career including financial services, technology, software, service provider, pharmaceutical, transportation, healthcare, and manufacturing. His tax practice experience has included planning, intercompany transfer pricing, structuring / restructuring of business operations, offshore intangibles, contract manufacturing, cross-border financing, mergers and acquisitions, legislation, private letter rulings, examinations and administrative appeals. Mr. Walker holds a Bachelor of Science in Business Administration from Georgetown University’s McDonough School of Business and a Juris Doctor and Master of Laws in Taxation from Georgetown University Law Center.

 

Timothy J. Yanoti. Mr. Yanoti has served as Executive Vice President and Chief Growth Officer since November 2018. From 2014 through 2018, he served as Co-Chairman and President of American Financial Resources, a residential mortgage originations company with over 500 employees operating in all 50 states. From 2011 through 2014, he was Senior Vice President, Head of Securitization for Fannie Mae where he was responsible for developing the Common Securitization Platform for the GSEs. Prior to joining Fannie Mae, Mr. Yanoti served as Managing Director, Head of Mortgage Banking of Knight Capital Group, a global financial services firm, and Senior Managing Director, Head of Capital Markets of National City Corporation. During his career Mr. Yanoti has also held several leadership roles at General Electric Company, including Head of Global Securitization of GE Capital and Head of Capital and Secondary Markets of GE Mortgage. Prior to entering the finance and banking industry he worked as an aerospace and software engineer. He received a Bachelor of Science from Clarkson University and a Master of Business Administration from Cornell University.

 

Dennis Zeleny. Mr. Zeleny has served as Executive Vice President and Chief Administrative Officer since August 2019. In that capacity, he oversees Ocwen’s global human resources function, corporate communications, facilities, and diversity and inclusion programs. From January through August 2019, Mr. Zeleny served Ocwen as a human resources consultant. From 2012 through 2019, Mr. Zeleny provided executive Human Capital consulting services including co-CEO Center on Executive Compensation, and an Interim CHRO for Hertz. He previously held the role of Chief Administrative or Chief Human Resources Officer at Sunoco, Caremark, and DuPont, oversaw global human resources at Honeywell and served 17 years at PepsiCo. Mr. Zeleny also served on the Board of HRPA, Cornell ILR Advisory Board, SXL and SCX, NYSE publicly traded companies. He received a B.S. from Cornell University and an M.S. from the Graduate School of Business at Columbia University.

 

 22 

 

 

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

AND RELATED SHAREHOLDER MATTERS

 

Beneficial Ownership of Equity Securities

 

The following table sets forth certain information regarding the beneficial ownership of our common stock as of April 15, 2020 by:

 

  each of our directors and director nominees;
  each named executive officer; and
  all of our directors and current executive officers as a group.

 

Each of Ocwen’s directors, director nominees and named executive officers may be reached through Ocwen Corporate Headquarters at 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409.

 

The following table also sets forth information with respect to each person known by Ocwen to beneficially own more than five percent of the outstanding shares of its common stock.

 

The table is based upon information supplied to us by directors and executive officers and filings under the Securities Exchange Act of 1934, as amended. We have based our calculation of the percentage of beneficial ownership on 129,683,377 shares of our common stock outstanding as of April 15, 2020, unless otherwise noted.

 

 23 

 

 

Shares Beneficially Owned(1)
Name and Address of Beneficial Owner: 

Amount of Beneficial

Ownership

   Percent of Class 

Deer Park Road Management Company, LP(2)

1195 Bangtail Way

Steamboat Springs, CO 80487

   13,356,147    10.3%

Leon G. Cooperman(3)

St. Andrew’s Country Club

7118 Melrose Castle Lane

Boca Raton, FL 33428

   12,193,460    9.4%

BlackRock Inc.(4)

55 East 52nd Street

New York, NY 10055

   9,514,671    7.3%

Roberto Marco Sella(5)

2929 Arch Street, Suite 325

Philadelphia, PA 19104

   6,821,474    5.3%

 

Directors and Named Executive Officers:
Scott W. Anderson(6)   253,326    * 
Alan J. Bowers(7)   151,715    * 
Jenne K. Britell(8)   113,858    * 
Jacques J. Busquet(9)   136,717    * 
Phyllis R. Caldwell(10)   285,651    * 
June C. Campbell(11)   83,377    * 
Catherine M. Dondzila(12)       * 
Robert J. Lipstein(13)   333,052    * 
Glen A. Messina(14)   674,242    * 
DeForest B. Soaries, Jr.(15)   59,447    * 
Kevin Stein(16)   104,278    * 
Timothy J. Yanoti(17)   107,785    * 
Dennis Zeleny(18)   5,000    * 
All Current Directors and Executive Officers as a Group (17 persons)(19)   2,777,229    2.1%

 

* Less than 1%
   
(1) For purposes of this table, an individual is considered the beneficial owner of shares of common stock if he or she has the right to acquire such common stock within 60 days of April 15, 2020 and directly or indirectly has or shares voting power or investment power, as defined in the rules promulgated under the Securities Exchange Act of 1934, as amended. Unless otherwise indicated, each person has sole voting power and sole investment power with respect to the reported shares. No shares have been pledged as security by the named executive officers or directors.
   
(2) Deer Park Road Management Company, LP: Based solely on information contained in a Schedule 13G/A filed with the Securities and Exchange Commission on February 14, 2020, reporting securities deemed to be beneficially owned as of December 31, 2019, by Deer Park Road Management Company, LP (“Deer Park”); Deer Park Road Management GP, LLC (“DPRM”); Deer Park Road Corporation (“DPRC”); Michael Craig-Scheckman (“Mr. Craig-Scheckman”); AgateCreek LLC (“AgateCreek”); and Scott Edward Burg (“Mr. Burg”), each of which reports shared voting and dispositive power of 13,356,147 shares held for the account of STS Master Fund, Ltd. (the “STS Master Fund”), which is an exempted company organized under the laws of the Cayman Islands. Deer Park serves as investment adviser to the STS Master Fund and, in such capacity, exercises voting and investment power over the shares held in the account for the STS Master Fund. DPRM is the general partner of Deer Park. Each of DPRC and AgateCreek is a member of DPRM. Mr. Craig-Scheckman is the Chief Executive Officer of each of Deer Park and DPRC and the sole owner of DPRC. Mr. Burg is the Chief Investment Officer of Deer Park and the sole member of AgateCreek.

 

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(3) Mr. Cooperman: Based solely on information contained in a Schedule 13G/A filed with the Securities and Exchange Commission on February 14, 2020 reporting securities beneficially owned as of December 31, 2019. Mr. Cooperman is the Managing Member of Omega Associates, L.L.C. (“Associates”), a limited liability company organized under the laws of the State of Delaware. Associates is a private investment firm formed to invest in and act as general partner of investment partnerships or similar investment vehicles. Associates is the general partner of a limited partnership organized under the laws of Delaware known as Omega Capital Partners, L.P. (“Capital LP”), a private investment firm comprised of Cooperman family funds engaged in the purchase and sale of securities for investment for its own account. Mr. Cooperman is the ultimate controlling person of Associates and Capital LP. Mr. Cooperman is married to an individual named Toby Cooperman, and has an adult son named Michael S. Cooperman. Mr. Cooperman has investment authority over the shares held by Toby Cooperman and Michael S. Cooperman. Mr. Cooperman reports sole voting and dispositive power with respect to 12,193,460 shares, which consists of 10,193,460 shares owned by Capital LP, 1,000,000 shares owned by Mr. Cooperman, 500,000 shares owned by Toby Cooperman, and 500,000 shares owned by Michael S. Cooperman.
   
(4) BlackRock, Inc.: Based solely on information contained in a Schedule 13G/A filed with the Securities and Exchange Commission on February 5, 2020 reporting securities deemed to be beneficially owned as of December 31, 2019, by BlackRock, Inc. Pursuant to the Schedule 13G/A, BlackRock, Inc. has sole voting power over 9,129,512 shares and sole dispositive power over 9,514,671 shares and is reporting beneficial ownership of the shares as the parent holding company or control person of BlackRock Advisors, LLC, BlackRock Investment Management (UK) Limited, BlackRock Asset Management Canada Limited, BlackRock Investment Management (Australia) Limited, BlackRock (Netherlands) B.V., BlackRock Fund Advisors, BlackRock Asset Management Ireland Limited, BlackRock Institutional Trust Company, National Association, BlackRock Financial Management, Inc., BlackRock Asset Management Schweiz AG, and BlackRock Investment Management, LLC.
   
(5) Mr. Sella: Based solely on information contained in a Schedule 13G/A filed with the Securities and Exchange Commission on February 6, 2020 reporting securities beneficially owned as of December 31, 2019, Mr. Sella reports sole voting and dispositive power with respect to 6,480,400 shares, consisting of 6,139,326 shares held of record by Roberto Marco Sella and 341,074 shares held of record by LL Charitable Foundation, of which Mr. Sella serves as President. Mr. Sella reports shared voting and dispositive power with respect to 341,074 shares held of record by the Roberto Sella 2012 Family Trust (the “Trust”). Francine Sella, Mr. Sella’s spouse, and Mr. Sella’s minor children are beneficiaries of the Trust. Francine Sella is a co-trustee of the Trust and in such capacity, Francine Sella has voting power over and power to dispose of the 341,074 shares of Common Stock held by the Trust. Mr. Sella is not a beneficiary of the Trust.
   
(6) Mr. Anderson serves as Executive Vice President and Chief Servicing Officer. Includes shares underlying 55,272 options which are presently exercisable and 16,875 options which could become exercisable within 60 days of April 15, 2020.
   
(7) Mr. Bowers serves as a director. Includes shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director.
   
(8) Dr. Britell serves as a director. Includes shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director. Also includes 39,580 shares held by trust.
   
(9) Mr. Busquet serves as a director. Does not include shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director but which are not settleable until June 1, 2022.
   
(10) Ms. Caldwell serves as Chair of the Board of Directors. Includes shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director.

 

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(11) Ms. Campbell serves as Executive Vice President and Chief Financial Officer. Includes shares underlying 11,060 options which are presently exercisable and 19,201 restricted stock units which could vest within 60 days of April 15, 2020. Also includes 47,638 shares held jointly with spouse.
   
(12)  Ms. Dondzila served as principal financial officer from July 17, 2018 through March 3, 2019.
   
(13) Mr. Lipstein serves as a director. Includes shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director. Mr. Lipstein has announced his retirement from the Board, effective immediately prior to the commencement of the Annual Meeting.
   
(14) Mr. Messina serves as President, Chief Executive Officer, and a director. Includes shares underlying 88,996 options which are presently exercisable. Also includes 308,300 shares held jointly with spouse.
   
(15) Dr. Soaries serves as a director. Does not include shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director but which are not settleable until the six-month anniversary of the director’s termination of service, 12,240 shares underlying vested RSUs which are not settleable until the six-month anniversary of the director’s termination of service, and 19,901 shares underlying vested RSUs which are not settleable until January 1, 2023.
   
(16) Mr. Stein serves as a director. Includes shares underlying 62,500 RSUs which will vest May 27, 2020 subject to certain conditions relating to the individual’s service as a director. Also includes 30,000 shares held by trust.
   
(17) Mr. Yanoti serves as Executive Vice President and Chief Growth Officer. Includes shares underlying 27,131 options which are presently exercisable and 23,255 restricted stock units which could vest within 60 days of April 15, 2020. Also includes 10,000 shares held by spouse.
   
(18) Mr. Zeleny serves as Executive Vice President and Chief Administrative Officer.
   
(19) Includes shares underlying 355,041 stock options which are presently exercisable, 26,250 stock options which could become exercisable within 60 days, and 42,456 restricted stock units which could vest within 60 days of April 15, 2020. Excludes shares beneficially owned by Catherine D. Dondzila, who is a Named Executive Officer for SEC purposes but not a current executive officer, and includes shares beneficially owned by John V. Britti, Albert. J Celini, Joseph J. Samarias, and Arthur C. Walker, Jr., who are current executive officers but not Named Executive Officers.

 

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Equity Compensation Plan Information

 

The following table sets forth information as of the end of the most recently completed fiscal year with respect to compensation plans under which our equity securities are authorized for issuance. As of the end of the most recently completed fiscal year, we did not maintain an equity compensation plan that had not previously been approved by security holders.

 

Plan Category 

Number of securities to

be issued upon exercise

of outstanding options,

warrants and rights

(#)(1)

  

Weighted average

exercise price of

outstanding options,

warrants and rights

($)(2)

  

Number of securities

remaining available for

future issuance under

equity compensation

plans(3)

(#)

 
Equity compensation plans
approved by security holders
   4,638,556    20.16    6,841,386 
Equity compensation plans not
approved by security holders
            
Total   4,638,556    20.16    6,841,386 

 

(1) Includes 1,979,431 shares subject to outstanding stock option awards and 2,659,125 shares subject to outstanding restricted stock unit awards (including outstanding performance-based restricted stock unit awards, which are presented at their target level of performance).
   
(2) Calculated exclusive of outstanding restricted stock unit awards, which do not have an exercise price.
   
(3) Represents 6,841,386 shares available for new award grants under the Company’s 2017 Performance Incentive Plan (the “2017 Plan”) as of December 31, 2019. Each share issued under the 2017 Plan pursuant to an award other than a stock option or other purchase right in which the participant pays the fair market value for such share measured as of the grant date, or appreciation right which is based upon the fair market value of a share as of the grant date, shall reduce the number of available shares by 1.2. Pursuant to the 2017 Plan, any shares subject to (1) restricted stock and restricted stock unit awards or (2) stock options granted under our 2007 Equity Incentive Plan that are presently outstanding which are subsequently forfeited, terminated, canceled, or otherwise reacquired by the Company will increase the pool of shares available for new awards under the 2017 Plan at the rate of 1.2 shares or 1.0 shares, respectively. Long-term incentive awards issued in the form of cash-settled restricted stock units do not reduce available shares under the 2017 Plan.

 

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers, directors and persons who own more than 10% of our common stock to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Based solely upon a review of reports filed electronically with the Securities and Exchange Commission during the 2019 fiscal year, or written representations from certain reporting persons that no Forms 5 were required, we believe that all filing requirements applicable to our officers and directors and greater than 10% beneficial owners were complied with during the 2019 fiscal year

 

 27 

 

 

LETTER FROM COMPENSATION COMMITTEE AND BOARD CHAIRS

 

Dear Fellow Shareholders:

 

In the following Compensation Discussion and Analysis we have provided the context and rationale the Compensation and Human Capital Committee (Compensation Committee) used in crafting the framework and determining the compensation for our named executive officers in 2019.

 

To begin with, 2019 was a year that required the management team and the broader employee population to work with remarkable focus and resiliency to execute against our key business initiatives following the acquisition of PHH Corporation (PHH) in October of 2018.

 

The aim of these initiatives was to return Ocwen to profitability in the shortest timeframe possible within an appropriate risk and compliance environment and to enable a sustainable business model with potential to create value for our shareholders.

 

The five initiatives were:

 

  Execute the integration of PHH into Ocwen
  Re-engineer our cost structure
  Establish funding for growth
  Replenish portfolio runoff and restore a growth focus
  Fulfill regulatory commitments and resolve remaining legacy matters

 

As we embarked on 2019, the Compensation Committee approved a 2019 Annual Incentive Plan for management containing ten objectives that linked directly to the above initiatives in order to align management’s annual bonus opportunity to executing on our strategy to create value for shareholders.

 

In addition, to ensure a strong alignment between the compensation of our management team and results for our shareholders, in 2019, the Compensation Committee took two important actions to re-orient compensation for the management team towards shareholder outcomes in very substantive ways.

 

First, the management team went from having zero percent of their target annual compensation tied to Ocwen’s stock price performance to having an average of 40% of it tied to Ocwen’s stock performance, with half of that value forfeitable unless a defined total shareholder return (TSR) threshold was met.

 

Second, the Compensation Committee reduced the bonus payout payable for 2018 performance to members of the senior management team by 35% and instead provided a “transitional” three-year long-term incentive opportunity which would only be realized if the Company achieved compounded annual growth of 16.7% in its stock price over the ensuing three-year period.

 

Based upon the feedback we received during our shareholder outreach initiative to shareholders who collectively hold more than 58% of our stock and looking back on the Company’s performance during 2019, we believe the compensation framework developed and the objectives against which we held management accountable were indeed the most important ones for our shareholders.

 

We invite you to read the following Compensation Discussion and Analysis for further details on our decisions relating to compensation during 2019, and we look forward to further shareholder engagement.

Sincerely,

 

DeForest B. Soaries Jr.

 

Chair, Compensation and Human Capital Committee

 

Phyllis R. Caldwell

Chair, Board of Directors

 

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EXECUTIVE COMPENSATION

 

Compensation Discussion and Analysis

 

Business Highlights

 

The design and the application of our executive compensation programs take shape and are delivered within the context of Ocwen’s business plan and its performance against that plan. 2019 was a year in which we set very ambitious goals for the company. It was also a year of tremendous change for the company in which we made progress on a number of the strategic, financial and operational priorities that we set out to accomplish.

 

Some of the key business highlights which the management team delivered against include:

 

  Completed integration of PHH Corporation which was acquired on October 4, 2018, including harmonization of policies, programs and platforms including the transitioning of all our servicing onto the Black Knight MSP servicing system.
  Delivered against synergy cost reduction objectives, including reducing total staffing levels by 1,100 or 17%, with a total headcount of approximately 5,300 at December 31, 2019 compared to the Ocwen headcount pre-PHH acquisition of 6,400 on September 30, 2018.
  Took substantial steps toward removing operating risk by complying with ongoing commitments under settlement agreements with 29 states and District of Columbia to resolve alleged deficiencies in compliance with laws and regulations relating to our servicing and lending activities.
  Grew total revenue by 6% to $1.1 billion in 2019.
  Improved our liquidity position, as measured by unrestricted cash, by over 30% from December 31, 2018 to a total of $428.3 million at December 31, 2019, while also increasing our available borrowing capacity under our advance financing facilities by 9% to $50.9 million from December 31, 2018 to December 31, 2019.
  Implemented a hedging strategy to partially offset the changes in fair value of our net MSR portfolio attributable to interest rate changes.

 

Compensation Highlights

 

The Compensation Committee designed the 2019 executive compensation program to align with evolving compensation and governance best practices and strengthen the rigor used to link to pay for performance and shareholder value creation.

 

The key features of our 2019 executive compensation program relating to pay decisions, program design and shareholder engagement are highlighted below:

 

  Introduced annual Long-Term Incentive (LTI) awards under our 2017 Performance Incentive Plan that (1) changed the mix of compensation tied to long-term objectives for our named executive officers (NEOs) from 0% to 40%; (2) tied all LTI award value to stock price performance; and (3) linked half of the target LTI award value granted to any participant to absolute TSR objectives over the course of a 3-year measurement period.
  Fortified the pay-for-performance linkage within our 2019 Annual Incentive Program (AIP) through the use of ten objectives that linked directly to our publicly-disclosed key business initiatives. Moreover, financial performance objectives which constituted over 50% of corporate and business unit scorecards were 100% formulaic with specific goal posts for threshold, target and maximum performance levels.
  Reduced 2018 AIP payments for all NEOs by 35% based on the Compensation Committee’s general assessment of the Company’s overall performance and financial condition
  Initiated an outreach effort to shareholders representing over 58% of outstanding shares regarding their views on our executive compensation program.
  Conducted a comprehensive, risk-based review of our compensation policies and practices designed to ensure appropriate mitigation of undue risk.

 

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Our named executive officers for 2019, whose compensation we will discuss in detail below, are as follows:

 

Name   Position
Glen A. Messina   President and Chief Executive Officer
June C. Campbell   Executive Vice President and Chief Financial Officer
Timothy J. Yanoti   Executive Vice President and Chief Growth Officer
Scott W. Anderson   Executive Vice President and Chief Servicing Officer
Dennis Zeleny   Executive Vice President and Chief Administrative Officer
Catherine M. Dondzila(1)   Former Senior Vice President and Chief Accounting Officer

 

  (1) Ms. Dondzila resigned as Senior Vice President and Chief Accounting Officer on May 31, 2019. Due to serving as principal financial officer during a portion of 2019, Ms. Dondzila is included in this Proxy Statement as a “Named Executive Officer” pursuant to the Securities Exchange Act of 1934, as amended.

 

Philosophy and Objectives of Our Executive Compensation Program

 

The philosophy underlying our executive compensation program is to provide an attractive, flexible, and market-based total compensation program that aligns the interests of executives and shareholders by rewarding both short-term and long-term performance against specific financial and strategic objectives designed to improve long-term shareholder value.

 

Equally important, our compensation programs are designed to communicate our goals and reinforce our standards as they relate to risk, compliance and leadership - not only to our senior management team, but across our entire employee population.

 

Within this context, we believe our executive compensation programs enable us to:

 

  Retain and hire top-caliber experienced executives: In a tight labor market, especially within an organization that is facing appreciable challenges to build a sustainable business model and pivot back to profitability, we believe it is critical that we offer compensation opportunities that allow us to attract and retain strong proven executive talent.
  Pay for Performance: A significant portion of our target 2019 executive compensation (the sum of base salary, annual target bonus, and grant date fair value of stock awards granted during 2019) – 63% for NEOs and 79% for CEO – was dependent on the Company’s business performance and our executive officers’ contribution to that performance, and the performance of our stock.
  Align compensation with shareholder interests: A consequential portion of our target 2019 executive compensation – 29% for NEOs and 53% for CEO – is directly tied to absolute TSR or stock price emphasizing our focus on shareholder value creation.
  Reinforce a long-term view: A major portion – 25% – of each executive officer’s target 2019 annual incentive compensation was tied to risk and compliance-based objectives demonstrating that our focus is not only on what was accomplished but on how it was accomplished. We believe that our focus on how things are done in the short-term will establish a foundation for long-term success.

 

2019 Incentive Programs

 

To create a strong link between our incentive compensation opportunities and our short-term and longer-term objectives, we use two specific programs: our AIP and LTI awards under our 2017 Performance Incentive Plan.

 

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The chart below illustrates the portions of our NEOs’ target 2019 executive compensation that are driven by the various objectives under our incentive programs. Our programs are designed to align the interests of our executives with the interests of our shareholders and link the drivers of short-term and long-term value creation with our executive compensation performance metrics.

 

Element of 2019 Compensation Description and Link to Key Priorities

NEOs’

(excluding CEO) Average % of Total Target Compensation

CEO’s % of Total Target Compensation
Salary

● Only element of total direct compensation that is not at risk based on short- or long-term performance.

● The Committee determines salaries after consideration of multiple factors, including comparative data from our peer group (described below).

37% 21%
AIP

● Target amount is informed by comparator groups, including peer group, and other factors further noted below.

● Funding is linked to key priorities of the Company in three areas (shown right).

● All components, as well as individual payouts, are capped at a maximum of 150%.

● Individual performance serves as a modifier to the corporate and business unit scorecard performance level (the Individual Performance Multiplier).

Financial Performance

 

 

17% 13%

Strategic and Operational Objectives

 

 

9% 7%

Managing Risk and Ensuring Compliance

 

 

 

9% 7%
LTI Awards(a)

● Target amount is informed by comparator groups, including peer group, and other factors further noted below.

● 50% of award is in form of Restricted Stock Units (RSUs) that vest annually over three years in equal tranches.

● 50% of award is in form of Performance-Restricted Stock Units (PRSUs) that cliff vest at end of three years provided minimum TSR level has been achieved.

 

Time-vested Units

 

 

 

13% 26%

Units Earned Based on Total Shareholder Return or Share Price

 

 

15% 26%
Total(b)   100% 100%

 

(a) Not included are one-time transitional PRSU awards granted to Messrs. Messina and Anderson, which were awarded based on the decision to reduce 2018 bonus payments and not as part of regular annual target compensation. Ms. Campbell’s LTI Awards were granted 50% as time-vested awards (RSUs and stock options) vesting in equal installments over three years, and 50% as PRSUs vesting in equal installments over four years if stock price doubles from grant date. Refer to “2019 Long-Term Incentive (LTI) Awards” below for further details.
(b) Other compensation that is available to all of our employees includes medical, dental and life insurance programs. 401(k) matching contributions account for less than 0.1% of our NEOs’ compensation.

 

On February 27, 2019, in furtherance of the Company’s cost re-engineering efforts, Mr. Messina volunteered to reduce his compensation as follows: (i) reduce his annual cash target incentive from $1,350,000 to $1,125,000, and (ii) reduce his annual long-term incentive equity target from a target value of $3,150,000 to $2,250,000. These reductions were effective for the 2019 calendar year and represented a reduction of approximately 20% to Mr. Messina’s target total compensation for 2019. On March 30, 2020, the Compensation Committee proposed to restore Mr. Messina’s 2020 target total compensation to the levels he received upon his October 4, 2018 hire, in recognition of his strong performance in his first full year as President and Chief Executive Officer in 2019 (described below) and informed by relevant market benchmarks, including the Company’s compensation peer group. However, Mr. Messina declined to accept the increased compensation. Consequently, Mr. Messina’s compensation levels for 2020 continue to reflect the reductions Mr. Messina agreed to in 2019.

 

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Parties Involved in Compensation Decisions

 

The governance of our executive compensation programs generally occurs through interaction of three groups: the Compensation Committee, the Compensation Committee’s independent compensation consultants and management. In 2019, on occasion and as it considered appropriate, the Compensation Committee enlisted the advice of outside counsel specializing in executive and non-employee director compensation matters to assist it in fulfilling its responsibilities under the Compensation Committee’s charter.

 

Role of the Committee

 

The Compensation Committee is responsible for overseeing the development and approval of our executive compensation and benefits policies and programs. The Compensation Committee, consisting of three independent directors, is responsible for the design, review and approval of all aspects of our executive compensation program. Among its duties, the Compensation Committee formulates recommendations to the Board for CEO compensation and reviews and approves all compensation recommendations for the other NEOs. Adjustments are made by the Compensation Committee in its judgment, taking into account compensation arrangements for comparable positions at peer group companies (discussed below), analysis prepared by Willis Towers Watson, individual performance of the NEO, an assessment of the value of the individual’s performance going forward and compensation levels necessary to maintain and attract quality personnel. Compensation levels are also considered upon a promotion or other change in job responsibility. Additionally, the Company considers feedback from shareholders, including feedback in the form of shareholder advisory votes on Ocwen’s executive compensation, as discussed below.

 

The Compensation Committee’s review for NEOs also includes:

 

  approval of corporate and business unit scorecards;
  evaluation of individual performance results to determine the Individual Performance Multiplier of each NEO;
  evaluation of the market competitiveness of each NEO’s total compensation (and principal elements of compensation) against applicable market data including a peer group of companies that are recommended to the Compensation Committee by its independent compensation consultant based on a number of metrics, including industry classification, revenues, assets and number of employees. The peer group used to help inform compensation decisions at the beginning of 2019 is listed below.

 

Associated Banc-Corp MGIC Investment Corporation
BankUnited, Inc. Navient Corporation
Black Knight Financial Services, Inc. PennyMac Financial Services, Inc.
CIT Group People’s United Financial, Inc.
CoreLogic, Inc. Radian Group Inc.
Euronet Worldwide Signature Bank
First Republic Bank Sterling Bancorp
Flagstar Bancorp, Inc. Synovus Financial Corp.
Jack Henry & Associates, Inc. Zions National Bancorp
LendingTree, Inc.  

 

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In August 2019, the Compensation Committee revised the peer group to the list below to better reflect our business model, scale and competitors.

 

Associated Banc-Corp Mr. Cooper Group Inc.
BankUnited, Inc. Navient Corporation
Black Knight Financial Services, Inc. PennyMac Financial Services, Inc.
CenterState Bank Corporation People’s United Financial, Inc.
CoreLogic, Inc. Radian Group Inc.
Flagstar Bancorp, Inc. Signature Bank
Jack Henry & Associates, Inc. Sterling Bancorp
LendingTree, Inc. Synovus Financial Corp.
MGIC Investment Corporation Walker & Dunlop, Inc.

 

  approval of any changes to compensation, including, but not limited to, base salary, short-term and long-term incentive award opportunities, severance payments and retention programs.

 

How We Make Compensation Decisions

 

Each year our executive and other compensation programs are developed and refined through a year’s worth of analysis and decision making by the Compensation Committee. A typical year’s work is summarized below:

 

QUARTER 1   QUARTER 2   QUARTER 3   QUARTER 4

● Evaluate the Company’s prior year performance against the financial and strategic metrics set forth in the prior year’s corporate and business unit scorecards.

● Review and evaluate the individual performance of the CEO and each of our other NEOs and other executive officers.

● Determine the payouts to be made under the AIP based on prior year’s performance.

● Determine total target compensation levels for our NEOs and other executive officers, as informed by both market data and prior year’s performance.

● Establish the structure and targets for the current year’s AIP to align with the financial and strategic priorities for the Company.

● Establish the structure for the current year’s LTI awards, including TSR or other performance objective.

 

● Prepare the Compensation Committee’s report and CD&A for the Proxy Statement.

● Review and discuss Say-on-Pay voting recommendations from proxy advisory firms.

● Review and discuss the results of the voting at the Annual Meeting.

● Review reports from the Compensation Committee’s independent compensation consultants on practices and trends in the industry.

 

 

● Undertake a review of the Company’s designated peer group to determine if any changes need to be made in order for it to remain appropriate.

● Commence shareholder engagement focused on the Say-on-Pay vote at the Annual Meeting to inform pay decisions and design compensation programs for the coming year.

 

● Continue shareholder engagement focused on Say-on-Pay vote at the Annual Meeting.

● Review the goals and objectives of the Company’s compensation programs.

● Conduct an assessment of executive compensation and independent Director compensation against peer group and relevant bench-marks assisted by analysis provided by the Compensation Committee’s independent compensation consultants.

● Conduct comprehensive, risk-based review of the Company’s compensation policies and practices that is designed to ensure appropriate mitigation of undue risk.

 

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These decisions and payments were made before the full global extent of COVID-19 became apparent. The Compensation Committee will consider the business and financial impact to Ocwen, our shareholders and our employees, in evaluating 2020 performance in early 2021.

 

Roles of Executive Officers

 

The President and Chief Executive Officer (CEO) is involved in the recommendation of certain compensation arrangements for approval by the Compensation Committee. The CEO, with the assistance of the Chief Administrative Officer, annually reviews the performance of the executive officers and is involved in formulating recommendations regarding equity compensation for the executive officers (other than himself, whose performance is reviewed, and compensation determined, by the Compensation Committee). The CEO presents his conclusions and recommendations regarding annual compensation and annual incentive opportunity amounts for the executive officers to the Compensation Committee for its consideration and approval. The Compensation Committee can exercise its discretion in accepting, rejecting and/or modifying any such executive compensation recommendations, subject, in each case, to any applicable limits contained in any plan or agreements applicable to such awards. All compensation decisions with respect to the compensation of the CEO are made by the Compensation Committee, which consults with the other non-management directors and outside advisors to the extent it deems appropriate. The Chief Administrative Officer assists the CEO and the Compensation Committee by providing them with market data and other reference materials.

 

Role of Independent Compensation Consultant

 

The primary role of the Compensation Committee’s independent compensation consultant (Willis Towers Watson) is to assist the Compensation Committee with overseeing the development and approval of our compensation policies and programs. Except as otherwise noted in this Compensation Discussion and Analysis, the Compensation Committee’s compensation determinations are the result of the Compensation Committee’s business judgment with respect to compensation matters. The Compensation Committee’s judgment is informed by the experiences of the members of the Compensation Committee and analysis and input from the Compensation Committee’s independent compensation consultants, among other factors. The Compensation Committee has assessed the independence of Willis Towers Watson and has concluded that its engagement does not raise any conflict of interest with the Company or any of its directors or executive officers. During 2019, Willis Towers Watson performed a number of services for the Compensation Committee, including but not limited to reviewing and providing guidance on:

 

  the design of the 2019 AIP and LTI awards
  market competitiveness of the 2019 compensation of our NEOs
  the Company’s peer group for purposes of informing compensation decisions
  the reports of proxy advisory firms, ISS and Glass-Lewis, relating to the 2019 Proxy Statement
  market competitiveness of the compensation of our independent directors
  emerging best practices for executive and independent director compensation

 

Shareholder Engagement and Consideration of Shareholder Advisors’ Input

 

Prior to last year, shareholder feedback in the form of shareholder advisory votes on Ocwen’s executive compensation has been very positive. At each of our Annual Meetings of Shareholders from 2014 through 2018, we received at least 85% of votes cast on our Say-on-Pay proposal in favor of our executive compensation. That changed last year when we received 66% support on the votes casted on our Say-on-Pay proposal. Based on outreach efforts to both institutional and active investors, we believe that a significant driver of this was the “AGAINST” recommendation provided by ISS’s proxy advisory group. We understand that factors guiding their recommendation included their views that annual incentive awards were tied to a large number of metrics, several of which they considered to be subjective, and that our CEO’s new hire equity grants were large and not performance-restricted.

 

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The Compensation Committee considered ISS’s input, as well as the input we gathered from reaching out or meeting directly with active investors. Through these outreach efforts we reached a group who held approximately 58% of our outstanding shares. During the shareholder engagement process, we shared with investors the changes we had made in our programs including the reduction of compensation levels and the introduction of a long-term incentive plan. As a result of the engagement process, we concluded that Ocwen’s current focus on rewarding the management team for cost reduction, maximizing the synergies of the PHH acquisition, settling legacy issues with regulators and focusing on the quickest return to profitability, as well as linking management’s compensation to absolute total shareholder return, aligns with the priorities of our shareholders.

 

The Compensation Committee and our Board of Directors intend to continue to consider shareholder feedback as well as recommended best practices put forth by shareholder proxy advisory firms such as ISS to the extent these institution’s recommendations are aligned with the interests of our shareholders. We also intend to continue to hold an advisory Say-on-Pay vote at each annual meeting of shareholders.

 

Key Governance Considerations in How We Design and Implement Our Compensation Programs

 

WHAT WE DO   WHAT WE DON’T DO
     

Pay for performance

Most of our NEOs’ pay is at-risk and not guaranteed. We set clear and transparent financial and strategic goals within our short- and long-term incentive awards which include performance-based vesting conditions.

 

No fixed term of employment agreements

We do not have employment agreements that provide for a fixed term of employment with any of our executive officers. Employment is at-will and provisions for separation and treatment of compensation is contained in applicable award documents or offer letters.

     

Discourage excessive risk taking

We operate within our risk management framework and include a balanced program design, multiple performance measures, claw-back and retention requirements. We also conduct an annual risk assessment of our NEO compensation plans to ensure they do not promote undue or excessive risk-taking.

 

No tax gross-ups

It is our policy to not provide tax gross-ups (other than for taxable relocation expenses for moves necessitated by our business), including tax gross-ups related to excess parachute payments as defined under section 280G of the Internal Revenue Code.

     

Retain an independent compensation consultant

The Compensation Committee has retained the services of Willis Towers Watson as an independent consultant that reports directly to the Chair of the Compensation Committee.

 

No option back-dating, re-pricing or reloading

We do not permit back-dating, re-pricing of stock options, or reloading of stock options. No stock options are granted with exercise prices that are below the closing price of Ocwen stock on the date of grant.

     

Caps on annual incentives and long-term awards

Our practice under the AIP provides for a maximum payout opportunity at 150% of the target incentive and our current equity incentive plan limits the number of shares that may be awarded to any individual to 4,000,000 shares during any 12 -month period.

 

No hedging or pledging

We prohibit directors and all employees, including executive officers, from pledging shares of our stock as collateral for loans or for other reasons and from engaging in any activity that hedges the economic risk of an investment in our stock.

     
   

No “single-trigger” LTI awards

With the exception of the sign-on LTIP for our CFO, 2019 LTI awards do not automatically vest upon the occurrence of a change in control. Rather, these LTI awards include double-trigger provisions such that a NEO will only receive accelerated payouts if terminated without cause, or upon voluntary resignation for good reason, following a change in control.

 

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Base Salaries for our NEOs.

 

Base salaries are intended to provide a level of cash compensation that is competitive and appropriate in relation to the responsibilities of the executive’s position. During 2019, the Compensation Committee provided an increase only to Ms. Campbell. Base salaries provided to our executives represent relative market competitive positioning, experience, performance and contributions to our success.

 

   Annualized Salary 
Name 

As of 12/31/2018 or 2019 Date of Hire

($)

  

As of 12/31/2019

or Separation

($)

  

Change to

Annualized Salary

(%)

 
Glen A. Messina   900,000    900,000    0%
June C. Campbell(1)   425,000    475,000    12%
Timothy J. Yanoti   450,000    450,000    0%
Scott W. Anderson   500,000    500,000    0%
Dennis Zeleny(2)   425,000    425,000    0%
Catherine M. Dondzila(3)   433,100    433,100    0%

 

  (1) Ms. Campbell assumed the role of Executive Vice President and Chief Financial Officer on March 4, 2019 and received a $50,000 increase in her base salary effective August 1, 2019 to compensate her for the expansion of her responsibilities to include oversight of the Capital Markets and Investor Relations functions.
  (2) Mr. Zeleny assumed the role of Executive Vice President and Chief Administrative Officer on July 31, 2019.
  (3) Ms. Dondzila resigned as Senior Vice President and Chief Accounting Officer on May 31, 2019.

 

Annual Incentive Compensation for our NEOs

 

Ocwen’s annual incentive compensation opportunity for eligible employees, including our executive officers, is provided under the 1998 Annual Incentive Plan (AIP), as amended, which has been approved by our shareholders. Awards under the plan are paid in cash or, in the Compensation Committee’s discretion, all or a portion of the total award value may be paid in the form of equity awards of our stock. Awards under the plan for 2019 were in the form of cash. The plan provides the Compensation Committee with the authority to establish incentive award guidelines which are further discussed below. If equity awards are granted as payment of an award under the 1998 Annual Incentive Plan, they will be granted pursuant to the 2017 Performance Incentive Plan discussed below. Other equity awards may also be made under the 2017 Performance Incentive Plan as discussed below.

 

Each executive officer has a target annual incentive award that is expressed as a percentage of base salary. The target annual incentive award for each executive officer was determined by the Compensation Committee based on its assessment of the nature and scope of each executive officer’s responsibilities and an assessment of compensation levels necessary to maintain and attract quality personnel as informed by market benchmarking.

 

As noted earlier in the Compensation Highlights section, the implementation of an annual LTIP is a continuation of our compensation strategy, which is to ensure that our executives’ overall pay mix accounts for both short-term and long-term objectives and will result in reduced target short-term compensation delivered through our Annual Incentive Plan. 2019 AIP targets were reduced from 2018 levels for many senior leaders, including Mr. Anderson. Mr. Messina’s 2019 AIP target was voluntarily reduced as part of cost savings initiatives. Ms. Campbell and Messrs. Yanoti and Zeleny were not eligible for the 2018 AIP.

 

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The table below reflects each presently-serving NEO’s 2019 AIP targets expressed as a percentage of his or her base salary and a comparison against 2018 AIP targets, if applicable. Under Ms. Dondzila’s separation agreement with the Company, she was not eligible for payouts under the 2019 Annual Incentive Plan and as such she is excluded from the below chart and subsequent narrative on 2019 AIP.

 

   Annualized AIP Target(1) 
Name 

As of 12/31/2018 or 2019 Date of Hire

($)

   % of Annualized Salary  

As of 12/31/2019 or Separation

($)

   % of Annualized Salary  

Percent Change to AIP Target

($)

 
Glen A. Messina(2)   1,350,000    150%   1,125,000    125%   -17%
June C. Campbell(3)   425,000    100%   475,000    100%   12%
Timothy J. Yanoti(4)   500,000    111%   500,000    111%   0%
Scott W. Anderson(5)   500,000    100%   450,000    90%   -10%
Dennis Zeleny   300,000    71%   300,000    71%   0%

 

  (1) Annualized AIP targets are pro-rated for in-year hire dates as well as in-year salary changes.
  (2) Effective January 1, 2019, Mr. Messina’s Annualized Incentive Target was voluntarily reduced to $1,125,000.
  (3) Effective August 1, 2019 Ms. Campbell received a $50,000 increase in her AIP target effective to compensate her for the expansion of her responsibilities to include oversight of both the Capital Markets and Investor Relations functions.
  (4) Mr. Yanoti was not eligible for a 2018 AIP due to the date of his hire.
  (5) Effective January 1, 2019, Mr. Anderson’s AIP target was reduced from $500,000 to $450,000 as part of the introduction of the annual LTI awards and pay mix rebalancing.

 

Detail on the 2019 Annual Incentive Plan (AIP)

 

The Compensation Committee structured the 2019 AIP award opportunity to help motivate executives to deliver against the five key initiatives listed below that it believes will enhance Company performance and create a path for long-term shareholder value.

 

  Execute the integration of PHH into Ocwen
  Re-engineer our cost structure
  Establish funding for growth
  Replenish portfolio runoff and restore growth focus
  Fulfill regulatory commitments and resolve remaining legacy matters.

 

In doing so, the Compensation Committee, working with the President and CEO, his management team and the Compensation Committee’s independent advisor, prioritized a series of 10 measurable objectives which formed the performance metrics of the Corporate Scorecard.

 

Award Determination for each NEO under the 2019 AIP

 

For each executive other than the CEO, the 2019 AIP award opportunity was based on a combination of three components.

 

  (i) The Company’s performance in meeting the objectives established in the corporate scorecard (the Corporate Scorecard);
     
  (ii) Meeting performance objectives of the executive officer’s business unit or support unit scorecard (the Business Unit Scorecard).
     
  (iii) An Individual Performance component which is based on an assessment of their individual performance against a number of key objectives unique to them, including achievement against key projects and their demonstrated leadership in promulgating a high-performing culture focused on teamwork, managing risk, and maintaining compliance.

 

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The performance achievement level in the first two components creates the baseline funding level for the executive’s 2019 AIP award. Specifically, for the CEO, 100% of funding comes from the Corporate Scorecard, and for the other NEOs, 80% of the funding comes from the Corporate Scorecard and 20% from the Business Unit Scorecard.

 

The baseline funding is then subject to an Individual Performance Multiplier recognizing the third component above.

 

Corporate Scorecard Component

 

The Corporate Scorecard which drives the overall funding for the AIP is approved annually by the Compensation Committee. The Committee then delegates to the CEO the development of the Business Unit Scorecards. The 2019 Corporate Scorecard contained both specific financial goals and other non-financial goals that are aligned to key business initiatives, including risk management. In determining whether to approve the Corporate Scorecard each year, the Compensation Committee considers a number of factors, including whether the goals are consistent with and likely to enhance corporate performance and long-term shareholder value, as well as the level of difficulty associated with attainment of each goal in the scorecard. The intent of the Compensation Committee is to establish the “target” performance at a level that is challenging to achieve, a “threshold” level for each goal that must be met in order for any portion of the incentive to be paid with respect to that goal, and a maximum or “outstanding” level for each goal that would result in payment of the maximum bonus opportunity with respect to that goal. The chart below depicts the level of achievement for a given objective on the scorecard and the corresponding incentive leverage that is applied to the target funding for the given objective.

 

Level of Achievement  % of Target Opportunity 
Outstanding (Maximum)   150%
Target   100%
Threshold   50%
Below Threshold   0%

 

The Committee measured the level of performance achievement against scorecard objectives using both quantitative and qualitative assessments, as appropriate. Quantitative assessments were used when the objective measure was numeric in nature, such as meeting the budget. For the assessments, the level of achievement was determined using straight-line interpolation between the “threshold”, “target” and “maximum” anchor posts, as applicable. Other objectives required a more nuanced and qualitative assessment, even for objectives containing deadlines and metrics which defined achievement, such as risk and compliance objectives. Achievement against these qualitative objectives were scored either “Pass” or “Fail” and yielded funding of 100% or 0%, respectively.

 

Prior to the Committee’s assessment of the level of performance achieved against scorecard objectives, the information on which the Committee based its assessment was first reviewed and verified by the Company’s Internal Audit, Finance and Risk Management functions.

 

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Based on the Company’s actual performance and the relative weightings assigned to each of the 10 objectives, the overall Corporate Scorecard 2019 AIP funding was 113.5%. Our Corporate Scorecard for 2019 and corresponding achievement levels are detailed below:

 

Corporate Objective Objective Weight Threshold Target Maximum Performance Outcome Performance Achievement Weighted Performance Achievement  
Financial Objectives  
Full-year pre-tax income before notable items(1) 50% (both objectives must meet threshold achievement) -$117M -$96M -$72M -$67M 150% 62.2%  
Fourth-quarter pre-tax income before notable items(1) -$9M $1M $25M $12M 124.5%  
Key Strategic Priorities  
Execute the integration - complete integration, loan boarding and legal entity merger actions and milestones per finalized integration plans as of March 15, 2019 5% Up to 30 days behind schedule overall Achieve integration plan milestones At least 30 days ahead of schedule overall Achieved integration plan milestones 100% 5%  
Achieve 2019 Board approved business plan volume objectives (amount and timing) - $ billions unpaid principal balance (UPB) replenishment funded by quarter and in the calendar year within targeted risk/return thresholds 5% $23B $27B $43B $17B 0% 0%  
Cost re-engineering annualized cost reduction achievement by year-end(2) 5% $300M $327M $345M $347M 150% 7.5%  
Establish funding for growth - achieve financing plan objectives of $100M senior secured term loan upsizing, 60% financing for purchased mortgage servicing rights (MSRs), and 60% secured funding against existing agency and Ginnie Mae MSRs on market rates and terms; all facilities renewed on time at market rates and terms 5% Pass / Fail Pass 100% 5%  
Timely and complete fulfillment of regulatory commitment deliverables 5% Pass / Fail Pass 100% 5%  
Risk and Compliance  
Promote Risk and Compliance culture within Board Risk Appetite thresholds 25% (objectives evaluated in the aggregate) Pass / Fail Pass 115% 28.75%  
Timely resolution of open issue remediation items (% resolved by policy remediation date) 80% 90% 100% 93%  
No significant current audit, exam or SOX matters Pass / Fail Pass  
TOTAL 100%   113.5%  

 

(1) Pre-tax income before notable items for purposes of the Corporate Scorecard excludes income statement notables and amortization of New Residential Investment Corp. (NRZ) lump-sum payments and refers to our pre-tax income/(loss) after excluding the positive impact of the amortization of NRZ lump-sum payments and after adjusting GAAP pre-tax income/(loss) for the following factors (1) Expense Notables (excluding MSR Valuation Adjustments, net), (2) changes in fair value of our Non-Agency MSRs due to changes in interest rates, valuation inputs and other assumptions, (3) changes in fair value of our Agency MSRs due to changes in interest rates, valuation inputs and other assumptions, net of hedge position, (4) offsets to changes in fair value of our MSRs in our NRZ financing liability due to changes in interest rates, valuation inputs and other assumptions, (5) changes in fair value of our reverse lending portfolio due to changes in interest rates, valuation inputs and other assumptions (6) gains related to exercising servicer call rights, and (7) certain other costs, including pension benefits (collectively, Other) consistent with the intent of providing management and investors with a supplemental means of evaluating our pre-tax income/(loss). Collectively, we refer to these adjustments as “income statement notables.” “Expense Notables” includes (1) expense related to severance, retention and other cost re-engineering actions, (2) certain significant legal and regulatory settlement expense items, (3) CFPB, Florida Attorney General/Florida Office of Financial Regulations and Massachusetts Attorney General litigation related legal expenses, state regulatory action related legal expenses and state regulatory action settlement related escrow analysis costs (collectively, CFPB and state regulatory defense and escrow analysis expenses), (4) NRZ consent process expenses related to the transfer of legal title in MSRs to NRZ, (5) PHH Corporation acquisition and integration planning expenses, (6) expense recoveries related to insurance recoveries of legal expenses, mortgage insurance claim settlement recoveries and amounts previously expensed from a service provider and (7) certain other costs including compensation expense reversals relating to departing executives and reversals of management incentive compensation payouts and reversals of reserves related to a legacy MSR sale (collectively, Other) consistent with the intent of providing management and investors with a supplemental means of evaluating our expenses.

 

(2) Cost re-engineering annualized cost reduction achievement by year-end for purposes of the Corporate Scorecard is compared to a 2Q’18 baseline and was adjusted for notable items, as defined above, and further adjusted to account for changes in certain beneficial GAAP accrual impacts that did not warrant inclusion for purposes of cost re-engineering performance measurement. See also Ocwen’s February 26, 2020 earnings call webcast and the accompanying presentation materials, which are available in the Shareholder Relations section of Ocwen’s website (www.ocwen.com).

 

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Business Unit Scorecard Component

 

In developing the Business Unit Scorecard goals in the NEO scorecards, we incorporated a variety of quantitative and qualitative measures to incentivize performance that we believe will help perpetuate the long-term success of the Company and discourage executives from pursuing short-term goals that may not be consistent with achieving such long-term success. The level of performance achievement against Business Unit Scorecard objectives was determined in the same manner described in the Corporate Scorecard section above.

 

Each NEO’s Business Unit Scorecard contained components and weighting consistent with the Company’s Corporate Scorecard, including:

 

  Financial Objectives (50% weight) contained the same full-year and fourth-quarter pre-tax income objectives for each executive officer’s respective area of responsibility;

  Key Strategic Priorities (25% weight) measured critical functional objectives, including meeting PHH integration objectives and timelines, and goals around cost re-engineering, which linked back to the work that each NEO needed to accomplish in their respective area to help the Company achieve the 10 objectives contained in the Corporate Scorecard; and

  Risk and Compliance (25% weight) contained the same objectives as the Corporate scorecard, measuring results for each executive officer’s respective area of responsibility.

 

Each NEO had a unique set of Key Strategic Priorities which correlated directly to line-of-sight objectives supporting Corporate objectives listed above in their respective area of responsibility and were weighted depending upon their relative importance within the category. Each executives Key Strategic Priorities included the following:

 

  Ms. Campbell’s Business Unit Scorecard was based on her oversight of the Finance, Capital Markets and Treasury departments, which included objectives on financial reporting and forecasting, and cultural transformation.
  Mr. Yanoti’s Business Unit Scorecard was based on his oversight of the Originations organization, which included objectives on unpaid principal balance (UPB) replenishment and customer satisfaction scores.
  Mr. Anderson’s Business Unit Scorecard was based on his oversight of the Servicing organization, which included objectives on on-boarding of loans, reduction of Consumer Financial Protection Bureau complaints, and customer satisfaction scores.
  Mr. Zeleny’s Business Unit Scorecard was based on his oversight of the Human Resources, Communications and Facilities organizations, which included objectives on executing the human capital aspects associated with the PHH integration, including managing the reduction of the workforce and other strategic initiatives.

 

Individual Performance Component

 

The Compensation Committee is accountable for both reviewing and approving the full-year performance evaluations and recommended performance appraisal ratings for each member of the Executive Leadership Team, including the President and CEO. The Compensation Committee considers recommendations from the CEO in determining performance appraisal ratings of the other NEOs. The CEO’s performance appraisal rating is determined by the Compensation Committee in consultation with the other non-management directors.

 

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The documentation provided to the Compensation Committee includes the executives’ self-assessments capturing their views on their performance against each of the objectives they and the CEO agreed to at the start of the year, as well as those that may have been introduced as a result of emerging priorities during the year. The objectives for all employees, including NEOs, fell into three weighted categories

 

  Key Business Unit and Functional Priorities (55% weight) reflected individual goals required to meet the objectives contained in the Corporate and Business Unit Scorecards;
  Leadership Expectations and Behaviors (25% weight, described below); and
  Risk and Compliance (20% weight) assessed executive performance in promoting a culture of risk and compliance, remediating of any identified issues, and lack of any material findings relating to audit, SOX or examination matters.

 

Leadership expectations and behaviors for our executive team require them to:

 

  Behave as a leadership role model and lead by example, demonstrate integrity, create a culture in which we keep our promises, treats all with respect and dignity, and build trust within and outside the organization.
  Build strong working relationships in which they solicit, consider and appropriately incorporate perspectives from others.
  Drive and deliver exceptional results by proactively anticipating situations that require a plan of action, identifying critical issues and assuming personal ownership for driving their resolution.
  Lead efforts on diversity and inclusion by creating, promoting and sustaining an inclusive work environment in which diversity, inclusiveness and respect are integral parts of our culture and work environment.
  Build and motivate a high performing team by identifying and securing top talent to increase performance while also actively holding people accountable for results and behaviors.
  Lead change by providing a visible anchor for others and helping resolve breakdowns in times of transition and uncertainty, and by convincing others of the need for change to support critical organizational objectives.

 

The Compensation Committee then evaluates the proposed results and performance appraisal recommendations and determines the final incentive compensation awards for each executive. Each executive receives an individual Performance Appraisal rating against a 4-point scale with an “individual performance multiplier” that is applied to their funded Annual Incentive, as described above.

 

The value for the multiplier is determined by the Compensation Committee using a value from the range shown in the chart below.

 

Individual Performance Rating  Individual Performance Multiplier 
Exceeds Expectations   105-125% 
Fully Meets Expectations   95-105% 
Sometimes Meets Expectations   70-95% 
Does Not Meet Expectations   0%

 

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Performance Rating for Each NEO

 

After careful consideration, the Compensation Committee - and the full Board, in the case of the CEO - determined that each of the NEOs’ performance warranted an Exceeds Expectations performance rating in 2019.

 

Name   Synopsis of Performance   Individual Performance Multiplier
Glen A. Messina   Quickly assessed leadership, retaining key individuals and recruited strong external complement necessary to execute against the complex turn-around and integration required in 2019.   125%
    Formulated and achieved an ambitious strategic and annual Business Plan which clearly identified the nature and magnitude of both the opportunities and challenges facing the business and established concrete and measurable actions to address them including establishing a new originations business.    
    Put in place a disciplined operating system (people, process, technology) to effectively manage achievement of business plan objectives and mitigate risk.    
    Put in place performance and incentive programs that reinforced driving results that right way including transformation needed around collaboration, transparency, self-identification of risks and issues, timely remediation with appropriate and scalable solutions.    
    Re-established proactive and effective relationships with key external constituents: shareholders, lenders, rating agencies, regulators, and consumer advocacy groups to provide updates on key initiatives and promote a positive image of the company.    
    Improved leadership diversity at VP and above levels in the US, increasing representation of women from 27% to 32% and minorities from 17% to 20%. Outside the US where diversity is measured by gender, the representation of women in Senior Manager roles increased from 13% to 17%.    
           
June C. Campbell   Took on a highly challenging leadership role and reorganized the function to upgrade talent and capability, process and systems and exit underperformers.   115%
    Under her direction, actions were sequenced to provide pay-down capacity while maintaining investment capability and all working capital facilities were renewed on or prior to termination dates, achieving significant savings on multiple renewals.    
    Eliminated duplicate systems and migrated to a single platform with no restatements or SOX control deficiencies, built a client and investor level financial analysis and new cost per loan model for Servicing and defined requirements and re-defined channel-specific financial views for Lending.    
           
Timothy J. Yanoti   Stabilized the Lending organization and oversaw the significant integration objective by developing a strategy and business plan for Lending, quickly communicating his clear vision, recruiting a strong leadership team, turning around the culture, exiting subpar performers and removing $40 million of cost from the business.   110%
    Started up the Correspondent channel and overall lending was profitable by the fourth quarter, positioning the Company for a target of over $10 billion in lending volume in 2020 compared to $1.4 billion in 2018.    
    Met or exceeded all of Lending’s financial objectives, exceeding the Lending Pre-Tax Income and volume targets.    
    Integrated two fundamentally different lending platforms on different systems in different locations, while accommodating the closure of a key lending headquarters in the forward lending business.    
    Completed numerous state and federal audits throughout 2019 with no material findings.    

 

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Scott W. Anderson   Planned for and executed the integration of the PHH-Ocwen operating platforms and the Black Knight Financial Services, Inc. LoanSphere MSP® servicing system onboarding while overseeing 23 functional area integration plans.   120%
    Surpassed Servicing’s 2019 annualized cost reduction goal by 20%.    
    Developed a dynamic cost of servicing model which enabled us to differentiate/understand servicing costs across three vectors, ultimately transforming the model from an analytic tool to a decision-making tool.    
    Delivered on all Servicing regulatory commitments.    
           
Dennis Zeleny   Quickly implemented a human capital agenda to support the merger and integration of people, processes and programs of Ocwen and PHH.   115%
    Led efforts to achieve Ocwen’s cost and synergy restructuring goals in the areas of site operations and personnel, which included the closing of eight facilities and the reduction of over 26% of the workforce from point of PHH’s acquisition.    
    Executed human capital plan including staffing efforts, extensive communication, and providing each outplaced employee with professional transition support.    
    Developed and deployed training to over 4,000 employees on the new mortgage servicing platform which was a critical requirement of the integration.    
    Demonstrated significant agility in responding to unplanned human capital business needs, including the design and launch of new corporate performance management process and long-term incentive program.    

 

Calculation of Total 2019 AIP Awards

 

Outlined below are the payout results (expressed as a percentage) for each component of the annual incentive opportunity: corporate component (based on the Corporate Scorecard), business unit component (based on the Business Unit Scorecard), individual component (individual performance multiplier based on performance appraisal) and total payout as a percentage of target annual incentive for each NEO.

 

    Payout for Annual Incentive Awards
    Organization Performance   Individual Performance   Final Award
Name   Corporate Performance Component (80% weight)   Business Unit Performance Component (20% weight)   Total Baseline Funding (100%)     Individual Performance Multiplier   Resulting Preliminary Award     Reduction to Remain within Corporate Budget(1)   Final Annual Incentive Payout (as a % of Target Annual Incentive)
Glen A. Messina   113.5%(2) + n/a = 113.5%   x 125% = 141.9%   x -4.14% = 136.0%
June C. Campbell   113.5% + 114.6% = 113.7%   x 115% = 130.8%   x -4.14% = 125.4%
Timothy J. Yanoti   113.5% + 112.5% = 113.3%   x 110% = 124.6%   x -4.14% = 119.5%
Scott W. Anderson   113.5% + 118.0% = 114.4%   x 120% = 137.3%   x -4.14% = 131.6%
Dennis Zeleny   113.5% + 133.2% = 117.4%   x 115% = 135.1%   x -4.14% = 129.5%

 

  (1) A negative adjustment of 4.14% was applied to all AIP eligible employees, including our NEOs, in order to remain within the budgeted cost for the 2019 AIP program.
  (2) Mr. Messina’s Total Baseline Funding was weighted 100% on Corporate Performance.

 

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2019 Long-Term Incentive Plan (LTIP)

 

Ocwen’s long-term incentive opportunity for eligible employees, including executive officers, through equity awards is provided under the 2017 Performance Incentive Plan (the “2017 Plan”). The 2017 Plan authorizes the grant of restricted stock, restricted stock units, options, stock appreciation rights or other equity-based awards, including cash-settled awards, to our employees (including executive officers), directors, advisors and consultants. To date, we have made grants under the 2017 Plan only to employees and directors. We implemented the 2017 Plan to motivate employees to make extraordinary efforts to achieve significant improvements to shareholder value, support retention of key employees and align the interests of our employees with the interests of our shareholders.

 

The Compensation Committee periodically reviews the granting of equity awards to employees based on such factors as Company performance, market competitive conditions and advice on executive compensation from the Compensation Committee’s independent compensation consultant.

 

2019 Long-Term Incentive (LTI) Awards

 

The annual LTI is designed to promote actions and decisions aligned with our strategic objectives and reward our executives and other program participants for long-term value creation for our shareholders in a manner that is consistent with our pay-for-performance philosophy. The implementation of the annual LTI program in 2019 is a continuation of our compensation strategy to ensure that our executives’ overall pay mix accounts for both short-term and long-term objectives and will result in reduced target short-term compensation delivered through our Annual Incentive Plan.

 

The program includes both a time-vesting component for retention purposes and performance-based component to align with pay-for-performance objectives. Half of the target value is granted as restricted stock units (RSUs) vesting in equal thirds on the first, second and third anniversaries of the grant, and half is granted as performance-restricted stock units (PRSUs) vesting at the end of a measurement period from March 29, 2019 through March 29, 2021 based on cumulative Total Shareholder Return (TSR) during such period. The number of target PRSUs that may vest based on cumulative TSR performance during the measurement period are interpolated between threshold 50% of PRSUs at 27.3% TSR, target 100% of PRSUs at 59.1% TSR, and maximum 200% of PRSUs at 91.0% TSR. No PRSUs will vest if TSR is below threshold.

 

Messrs. Messina, Anderson, Yanoti and Zeleny and Ms. Dondzila received awards under the 2019 annual LTI program. Ms. Dondzila’s award was later forfeited prior to any vesting upon her resignation. With the exception of Mr. Messina’s award, these awards will be cash-settled to avoid share dilution, but were granted as share-based units to align final award value with share performance.

 

Additionally, Messrs. Messina and Anderson and Ms. Dondzila received additional “transitional” awards relating to the 35% reduction of their 2018 bonus payment. Ms. Dondzila’s award was later forfeited prior to any vesting upon her resignation. These cash-settled restricted stock unit awards vest in equal thirds on the first, second and third anniversaries of the grant dates based on the Company’s cumulative TSR during three performance periods, each beginning March 29, 2019. The number of target PRSUs that may vest range based on cumulative TSR performance during each measurement period are interpolated between 50% at threshold, 100% at target, and 200% at maximum. No PRSUs will vest if cumulative TSR is below threshold. For the one-, two- and three-year periods ending March 29, 2020, 2021 and 2022, cumulative TSR performance thresholds are 8.4%, 17.4% and 27.3%, targets are 16.7%, 36.3% and 59.1%, and maximums are 24.0%, 54.0% and 94.0%, respectively.

 

In connection with Ms. Campbell’s new hire offer, she was granted the following equity awards on March 4, 2019: (1) a stock option with a grant date fair value of $72,000 and an exercise price equal to the closing price of our stock on the date of grant, which vest in equal thirds on the first, second and third anniversaries of the grant date, (2) RSUs with a grant date fair value of $53,000, which vest in equal thirds on the first, second and third anniversaries of the grant date, and (3) PRSUs with a grant date fair value of $125,000, which vest in equal fourths on the first, second, third and fourth anniversaries of the grant date, provided that on or before the fourth anniversary of the grant date, the average of the closing stock price over a period of 20 consecutive trading days equal or exceeds $4.34. Ms. Campbell did not receive any awards under the 2019 annual LTI program but expects to participate in the 2020 annual LTI program.

 

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The table below shows the annual target value of equity awards granted to our current NEOs in 2019 as well the percentage of the target value of such equity awards that are subject to performance vesting.

 

Name 

Annual Target Value Granted as Restricted Stock Units

($)

  

Annual Target Value Granted as Performance Restricted Stock Units

($)

  

Target Value of Additional Performance Restricted Stock Units

($)

  

Target Value of Stock Options

($)

  

Total Target Value of Awards Granted

($)

   Percent of Target Value that is Performance Based 
Glen A. Messina   1,125,000    1,125,000    115,212        2,365,212    52%
June C. Campbell   53,000    125,000        72,000    250,000    50%
Timothy J. Yanoti   250,000    250,000            500,000    50%
Scott W. Anderson   150,000    150,000    175,000        475,000    68%
Dennis Zeleny   187,500    187,500            375,000    50%
Catherine M. Dondzila   54,138    54,138    96,915        205,190    74%

 

Realizable Value of Outstanding Equity at Year-End

 

Further illustrating Ocwen’s commitment to shareholder alignment, if the year-end share price stays flat in future performance and vesting periods, it would result in a 75% average loss of target LTI value for our executives for awards granted over the past three years. (As reference, no equity awards were granted to NEOs between March 30, 2016 and October 3, 2018.) As shown below, based on $1.37 closing share price on December 31, 2019, all performance-based units would be forfeited and stock options would be underwater, in addition to the 52% total reduction in RSU value compared to their grant date value.

 

       Award Value at $1.37 Share Price         
Name 

Total Target Value of Outstanding Units at Grant

($)

  

Realizable Value of Outstanding Restricted Stock Units

($)

  

Realizable Value of Outstanding Performance Restricted Stock Units

($)

  

Realizable Value of Outstanding Stock Options

($)

  

Change in Award Value from Grant

($)

  

Change in Award Value from Grant

(%)

 
Glen A. Messina   6,165,214    1,672,314    0    0    -4,492,900    -73%
June C. Campbell   250,000    33,461    0    0    -216,540    -87%
Timothy J. Yanoti   958,332    241,287    0    0    -717,045    -75%
Scott W. Anderson   475,000    112,911    0    0    -362,088    -76%
Dennis Zeleny   375,000    135,197    0    0    -289,802    -64%

 

Other Compensation

 

Our policy with respect to employee benefit plans generally is to provide benefits to our employees, including our executive officers, which are comparable to benefits offered by companies of a similar size. We believe that a competitive comprehensive benefit program is essential to achieving the goal of attracting and retaining highly-qualified employees. Our NEOs participate in the benefit plans offered to our salaried employees, generally, including medical, dental, life and disability insurance plans, and a 401(k) plan.

 

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Stock Ownership and Prohibition against Short Sales, Hedging and Margin Accounts

 

Although we do not have stock ownership requirements for our executives, our philosophy is that equity ownership by our executives is important to attract, motivate and retain executives, as well as to align their interests with those of our shareholders. The Compensation Committee believes that the Company’s equity plans are adequate to achieve this philosophy.

 

We maintain an Insider Trading Prevention Policy that governs the timing of transactions in securities of the Company by directors and executives. In addition, the Policy prohibits any director, officer or employee from engaging in any short sale of the Company’s stock, establishing and using a margin account with a broker-dealer for the purpose of buying or selling Company stock, or buying or selling puts or calls on the Company’s stock. This policy is designed to encourage investment in the Company’s stock for the long term and to discourage active trading or short-term speculation.

 

Clawback Policy

 

The Company maintains an incentive compensation clawback policy that allows our Board of Directors or the Compensation Committee to recoup incentive compensation if the Company restates its financial statements. The policy applies to cash or equity incentive payments or awards to Covered Individuals (as defined below) when (1) the amount of any such payment or award was determined based on the achievement of financial results that were subsequently the subject of an accounting restatement due to noncompliance with any financial reporting requirement under federal securities laws, (2) a lesser (or no) payment or award would have been made based upon the restated financial results, and (3) the payment or award was received (or the applicable vesting event of the award occurred) during the three-year period preceding the date on which the Company is required to prepare such accounting restatement. For purposes of the policy, a “Covered Individual” means any current or former employee who, at the time of receipt of any such payment or award, was an executive officer of the Company or an Executive Vice President or more senior officer of the Company or any of its subsidiaries.

 

Restrictive Covenants

 

All of our NEOs have executed an intellectual property and non-disclosure agreement. This agreement requires the NEO to hold all “confidential information” in trust for us and prohibits the NEO from using or disclosing such confidential information except as necessary in the regular course of our business or as otherwise required by law. Other than these restrictive covenants, we generally do not have non-competition or non-solicitation agreements with our executive officers. From time to time, we enter into separation agreements with executive officers that contain these provisions. In addition, certain of our equity award agreements contain provisions that provide that post-retirement vesting or exercise of the award, as applicable, is dependent on compliance with certain covenants.

 

Tax Considerations

 

Section 162(m) of the Internal Revenue Code generally disallows public companies a tax deduction for compensation in excess of $1,000,000 paid to its “covered employees.” Prior to federal tax reform enacted in December 2017, Section 162(m) included an exception to this limitation on deductibility for qualifying “performance-based compensation,” provided that certain performance and other requirements are met. Under the new tax legislation, for taxable years beginning after December 31, 2017, there is no longer an exception to the deductibility limit for qualifying “performance-based compensation” unless the compensation qualifies for transition relief applicable to certain arrangements in place as of November 2, 2017. Also under the new legislation, the definition of “covered employees” has been expanded to include a company’s chief financial officer (in addition to the chief executive officer and three other most highly paid executive officers), plus any individual who has been a “covered employee” in any taxable year beginning after December 31, 2016. As one of the factors in its consideration of compensation matters, the Compensation Committee considers the anticipated tax treatment to the Company of various payments and benefits, including the impact of Section 162(m). However, we reserve the right to design programs that may not be deductible under Section 162(m) if we believe they are nevertheless appropriate to help achieve our executive compensation program objectives, and in any case, there can be no assurance that any compensation paid by the Company will be fully deductible.

 

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CEO Pay-Ratio Disclosure

 

Pursuant to the Securities Exchange Act of 1934, as amended, we are required to disclose in this proxy statement the ratio of the total annual compensation of our CEO to the median of the total annual compensation of all of our employees (excluding our CEO). Based on Securities and Exchange Commission rules for this disclosure and applying the methodology described below, we have determined that Mr. Messina’s total compensation for 2019 was $7,562,330 and the median of the total 2019 compensation of all of our employees (excluding our CEO) was $33,651 (after applying a cost-of-living adjustment and converting foreign currency to U.S. dollars, as described below). Accordingly, we estimate the cost-of-living-adjusted ratio of our CEO’s total compensation for 2019 to the median of the total 2019 compensation of all of our employees (excluding our CEO) to be 225 to 1.

 

We identified the median employee by taking into account the total compensation paid for 2019 to all individuals, excluding our CEO, who were employed by us or one of our subsidiaries on December 31, 2019. We included all employees, whether employed on a full-time, part-time, or seasonal basis. We did not annualize the compensation for any employees who were not employed by us for all of 2019. We applied a cost of living adjustment to employees employed outside of the United States as described below. Once the median employee was identified as described above, that employee’s total compensation for 2019 was determined using the same rules that apply to reporting the compensation of our Named Executive Officers (including our CEO) in the “Total” column of the Summary Compensation Table. The total compensation amounts included in the first paragraph of this pay-ratio disclosure were determined based on that methodology (in the case of the median employee’s compensation, as adjusted for cost-of-living and currency conversion as described below).

 

If we only considered our U.S.-based employees (excluding our CEO) in identifying the median employee using the methodology otherwise described above, we determined that our median U.S.-based employee’s total compensation was $57,598. Accordingly, we estimate the resulting ratio of our CEO’s total compensation to the median of the total compensation of all our U.S.-based employees (excluding our CEO) to be 131 to 1.

 

In calculating the compensation of our employees in the Philippines, we applied a currency conversion factor based on the U.S. dollar to Philippines Peso exchange rate as of December 31, 2019. In calculating the compensation of our employees in India, we applied a currency conversion factor based on the U.S. dollar to Indian Rupee exchange rate as of December 31, 2019.1 As permitted under SEC rules, in identifying the median employee and in presenting the median employee’s total 2019 compensation above, we applied a cost-of-living adjustment to the compensation of employees outside the United States based on a purchasing power parity conversion factor published by The World Bank for 2018.2 Using this methodology, we determined that our median employee is employed in India. If we had determined the median employee and total compensation as described above but had not applied a cost-of-living adjustment to identify our median employee or calculate our median employee’s total compensation, the median of the total compensation of all of our employees (excluding our CEO) would have been $10,916 and we estimate the resulting ratio of our CEO’s total compensation to the median of the total compensation of all of our employees (excluding our CEO) would have been 693 to 1.

 

 

1 As reported by the U.S. Bureau of the Fiscal Service Treasury Reporting Rates of Exchange as of December 31, 2019, the Indian Rupee to U.S. Dollar to conversion rate was 71:1 and the Philippines Peso to U.S. Dollar to conversion rate was 50.64:1.

 

2 The “price level ratio of PPP conversion factor (GDP) to market exchange rate” published by the World Bank indicates how many U.S. dollars are needed to buy one U.S. dollar’s worth of goods in a particular country. For 2018, the most recent data accessible, the ratio reported for both India and the Philippines was 0.3, meaning the local currency equivalent of $1 purchased $3.33 worth of goods in those countries. Accordingly, we multiplied the 2019 compensation of each employee based in India or the Philippines by 3.33 prior to identifying the employee with the median of the total 2019 compensation and in presenting such employee’s total compensation in order to reflect a cost-of-living adjustment.

 

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Report of the Compensation Committee

 

The Compensation Committee of the Board of Directors has reviewed and discussed the Compensation Discussion and Analysis of this proxy statement with management.

 

Based on the review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.

 

April 27, 2020 Compensation Committee:
   
  DeForest B. Soaries, Jr., Chair
  Jenne K. Britell, Director
  Jacques J. Busquet, Director

 

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Summary Compensation Table - 2017, 2018 and 2019

 

The following table provides information concerning the compensation of our named executive officers for the 2019, 2018 and 2017 fiscal years.

 

Name and Principal Position  Year  

Salary

($)

  

Bonus

($)

  

Stock

Awards(1)

($)

  

Option

Awards(1)

($)

  

Non-Equity Incentive Plan Compensation(2)

($)

  

All Other Compensation(3)

($)

  

Total

($)

 
                                 
Glen A. Messina   2019    900,000         2,518,950         1,529,974    2,613,406    7,562,330 
President and Chief Executive Officer   2018    214,615        4,050,001    791,035    213,966    1,690,804    6,960,421 
                                         

June C. Campbell

Executive Vice President and Chief Financial Officer(4)

   2019    370,673    253,757    153,986    51,432    468,583    120,113    1,418,545 
                                         
Timothy J. Yanoti Executive Vice President and Chief Growth Officer   2019    450,001        559,066        597,359    80,804    1,687,230 
                                         
Scott W. Anderson   2019    500,000        538,002        592,207        1,630,208 
Executive Vice President, Chief Servicing Officer   2018    500,000                314,236        814,236 
    2017    500,000                542,984    750    1,043,734 
                                         

Dennis Zeleny

Executive Vice President and Chief Administrative Officer(5)

   2019    176,539    350,000    409,539        163,879    426,000    1,525,956 
                                         
Catherine M. Dondzila   2019    183,235        233,244            868,645    1,285,124 
Former Senior Vice President and Chief Accounting Officer(6)   2018    433,100                159,197    6,200    598,497 

 

(1) Represents the aggregate grant date fair value of stock awards and stock options, computed in accordance with FASB ASC 718. These amounts do not represent the actual amounts paid to or realized by the executive. We based the grant date fair value of stock awards with a service condition on the average of the high and low prices of our common stock as reported on the New York Stock Exchange on the date of grant of the awards. The fair value of the time-based option awards was determined using the Black-Scholes options pricing model. Stock unit awards with only a service condition are valued at their intrinsic value, which is the market value of the stock on the date of the award. The fair value of stock unit awards with both a service condition and a market-based vesting condition is based on the output of a Monte Carlo simulation.  Additional detail regarding the calculation of these values is included in Note 22 to our audited financial statements for the fiscal year ended December 31, 2019, which are included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2020.
(2) Represents annual incentive compensation earned in the corresponding year and paid in the first quarter of the following year.
(3) Amounts shown in this column are set forth in the supplemental “All Other Compensation” table below.
(4) Ms. Campbell assumed the role of Executive Vice President and Chief Financial Officer on March 4, 2019. In connection with her employment and to induce her to join the company, she received a signing bonus which is reported in the “Bonus” column.
(5) Mr. Zeleny assumed the role of Executive Vice President and Chief Administrative Officer on July 31, 2019. In connection with his employment and to induce him to join the company, he received a signing bonus which is reported in the “Bonus” column.
(6) Ms. Dondzila resigned as Senior Vice President and Chief Accounting Officer on May 31, 2019.

 

For more information about the elements of the compensation paid to our named executive officers, see “Compensation Discussion and Analysis” above.

 

 49 

 

 

All Other Compensation

 

The following table provides additional information about the amounts that appear in the “All Other Compensation” column in the Summary Compensation Table.

 

Executive Officer 

401(k) Matching Contributions(1)

($)

  

Relocation Benefits(2)

($)

  

Other

($)

  

Total

($)

 
Glen A. Messina(3)   7,269    577,971    2,028,165    2,613,406 
June C. Campbell       120,113        120,113 
Timothy J. Yanoti   1,558    79,247        80,804 
Scott W. Anderson                
Dennis Zeleny(4)           426,000    426,000 
Catherine M. Dondzila(5)   8,400        860,245    868,645 

 

(1) Reflects employer matching contributions made under the Ocwen Financial Corporation 401(k) Savings Plan.
(2) Reflects the value of temporary commuting and relocation benefits paid under the Ocwen Relocation Plan, including amounts to gross-up for taxable expenses.
(3) “Other” reflects the value of Mr. Messina’s severance benefits to which Mr. Messina was entitled as former President and Chief Executive Officer of PHH Corporation.
(4) “Other” represents the value of fees paid to Mr. Zeleny as an independent consultant prior to regular full-time employment.
(5) “Other” represents the values of Ms. Dondzila’s lump sum payment in exchange for a general release of claims upon her resignation as Senior Vice President and Chief Accounting Officer on May 31, 2019 ($568,870), independent consulting agreement ($216,550), payout of accrued paid time off balances ($62,825), subsidy for COBRA benefits continuation ($11,620) and stipends paid to cover telecommuting expenses ($381).

 

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Grants of Plan-Based Awards for 2019

 

The following table provides information related to awards granted in 2019 under our 2017 Performance Incentive Plan and our 1998 Annual Incentive Plan, as amended.

 

      Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1)  

Estimated Future Payouts

Under Equity

Incentive Plan Awards

   All Other Stock Awards: Number of Shares of Stock or   All Other Option Awards: Number of Securities Underlying   Exercise or Base Price of Option  

Grant Date Fair Value of Stock and Option

Awards

 
Name  Grant Date 

Threshold

($)

  

Target

($)

  

Maximum

($)

  

Threshold

(#)

  

Target

(#)

  

Maximum

(#)

  

Units(2)

(#)

  

Options

(#)

  

Awards

($)

  

(3)

($)

 
Glen A. Messina  3/29/2019   562,500    1,125,000    1,687,500                             
   4/11/2019(4)              282,663    565,327    1,130,654                1,271,986 
   4/11/2019                           565,326            1,124,999 
   4/11/2019(5)               28,947    57,895    115,790                121,966 
June C. Campbell  3/29/2019   186,884    373,767    560,651                             
   3/04/2019(6)                   57,604                    100,986 
   3/04/2019                           24,424            53,000 
   3/04/2019                               33,180    2.17    51,432 
Timothy J. Yanoti  3/29/2019   250,000    500,000    750,000                             
   3/29/2019(4)               68,681    137,363    274,726                309,067 
   3/29/2019                           137,362            249,999 
Scott W. Anderson  3/29/2019   225,000    450,000    675,000                             
   3/29/2019(4)               41,209    82,418    164,836                185,441 
   3/29/2019                           82,417            149,999 
   3/29/2019(5)               48,076    96,153    192,306                202,562 
Dennis Zeleny  7/31/2019   63,288    126,575    189,863                             
   7/31/2019(4)               49,342    98,684    197,368                222,039 
   7/31/2019                           98,684            187,500 
Catherine M. Dondzila