DFAN14A l homeloandfanl4a-02l2l5.htm FEBRUARY 12,2015
`
`SCHEDULE 14A
`
`(Rule 14a-101)
`INFORMATION REQUIRED IN PROXY STATEMENT
`SCHEDULE 14A INFORMATION
`
`PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
`THE SECURITIES EXCHANGE ACT OF 1934
`
`(Amendment No. )
`
`Filed by the Registrant | ]
`
`Filed by a Party Other than the Registrant [x]
`
`Check the Appropriate Box:
`
`[] Preliminary Proxy Statement
`[]Confidential, for Use of the Commission Only (as permitted by
`Rule 14a-6(e)(2))
`[ ] Definitive Proxy Statement
`[] Definitive Additional Materials
`[x] Soliciting Material Pursuant to Rule l4a-1 1(c) or Rule 14a-12
`
` .
`(Name ofregistrant as specified in its charter)
`
`The Mangrove Partners Master Fund, Ltd.
`The Mangrove Partners Fund, L.P.
`Mangrove Partners Fund (Cayman), Ltd.
`Mangrove Partners
`Mangrove Capital
`Nathaniel August
`Kevin J. Doyal
`John S. Dubel
`
`A. Jay Meyerson
`Amy C. Schumacher
`(Name of person(s) filing proxy statement, if other than the registrant)
`Payment of Filing Fee (Check the Appropriate Box):
`
`[x]No fee required.
`[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l) and 0-1 1.
`
`(1) Title of each class of securities to which transaction applies:
`(2) Aggregate number of securities to which transaction applies:
`(3) Per unit price or other underlying value oftransaction computed pursuant to
`Exchange Act Rule 0-1 1 (set forth the amount on which the filing fee is
`calculated and state how it is determined):
`(4) Proposed maximum aggregate value of transaction:
`(5) Total fee paid:
`
`[] Fee paid previously with preliminary materials:
`[] Check box if any part of the fee is ofllset as provided by Exchange Act
`Rule 0-1 1(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by
`registration statement number, or the form or schedule and the date of its filing.
`(1) Amount Previously Paid:
`
`Page 1 of 7
`
`VIRNETX EXHIBIT 2014
`
`Mangrove v. VirnetX
`Trial lPR2015—O1047
`
`

`
`(2) Form, Schedule or Registration Statement no.:
`(3) Filing Party:
`(4) Date Filed:
`
`Page 2 of 7
`
`

`
`The Mangrove Partners Master Fund, Ltd., together with the other participants named herein (collectively, “Mangrove”),
`is filing materials contained in this Schedule 14A with the Securities and Exchange Commission (the “SEC”) in connection
`with the solicitation of proxies by Mangrove at the 2015 annual meeting of shareholders (the “Annual Meeting”) of Home Loan
`Servicing Solutions, Ltd. Mangrove has not yet filed a proxy statement with the SEC with regard to the Annual Meeting.
`
`On February 12, 2015, Mangrove issued the following press release:
`
`Page 3 of 7
`
`

`
`Mangrove Nominates A Full Slate Of Five Highly
`Qualified Individuals For Election To The Board
`
`Of Directors Of Home Loan Servicing Solutions,
`Ltd. Believes Wholesale Board Change is Needed to Protect HLSS
`Shareholders from Risks Related to Ocwen Loan Servicing, LLC
`
`Reiterates Belief that There is Opportunity to Generate Significant
`Value for Shareholders by Transferring Servicing Rights Away
`from Ocwen
`
`EW YORK, Feb. 12, 2015 /PRNewswire/ -- The Mangrove Partners Master Fund, Ltd. ("Mangrove"), a significant shareholder
`of Home Loan Servicing Solutions, Ltd. (Nasdaq: HLSS), today announced it has formally nominated five highly qualified and
`independent director nominees —Nathaniel August, Kevin J. Doyle, John S. Dubel, A. Jay Meyerson and Amy C. Schumacher
`for election to the Board of Directors of HLSS at its upcoming 2015 Annual General Meeting of shareholders.
`
`athaniel August, the founder and President of Mangrove Partners and a nominee, stated: "As we have previously explained to
`the Board, we have serious concerns that this Board is exposing HLSS shareholders to potentially significant value destruction
`hrough the Company's continued relationship with Ocwen. We believe that ending the Company's relationship with Ocwen
`both protects shareholders from value destruction and moreover has the potential to generate significant additional value.
`
`"Our Valuation work leads us to believe that transferring the servicing rights away from Ocwen could create significant value
`for HLSS — between $8 and $13 per share of incremental value to HLSS in our reasonable estimation. Based on the Company's
`book value on September 30, 2014, this would represent an increase in book value of between 44% and 72%."
`
`Mr. August continued: "But instead of action, this Board has provided us with nothing more than vague assurances that it has
`been working to address these issues. Given the significant value destruction that shareholders are facing coupled with the
`value-creating opportunity this Board appears intent on wasting, empty promises and ambiguous commitments are moot. That is
`why we are taking the extraordinary step of nominating a slate of five highly qualified independent nominees to the Board who
`we believe will be committed to completing the strategic actions necessary to protect and enhance shareholder value at HLSS."
`
`Mr. August concluded: "While we remain open to further discussion with the Board and are amenable to reaching a mutually
`agreeable resolution that benefits all shareholders, we remain firm in our position on this matter — HLSS must terminate its
`relationship with Ocwen. Ifthis Board continues to refiise to take action, we look forward to presenting shareholders with what
`we believe will represent the far superior choice of leadership at the Company's 2015 Annual Meeting."
`
`Mangrove's nominees are:
`
`athaniel Au ust. Mr. August is the founder and President of Mangrove Partners and has an extensive background in financial
`analysis and a broad understanding ofthe operational, financial and strategic issues facing public companies. Prior to founding
`Mangrove Partners in April 2010, Mr. August was a Director at White Eagle Partners, a global, value-oriented investment
`advisory firm, fiom December 2008 to January 2010. Previously he served as a Senior Analyst at Brahman Capital Partners, a
`long/short equity strategy hedge fund, fiom March 2006 to September 2008, an Investment Analyst at K Capital Partners, a
`private investment firm, fiom June 2003 to January 2006, and an Analyst at Goldman Sachs in the Principal Investment Area
`fiom July 2001 to May 2003.
`
`Kevin J. Do le. Mr. Doyle brings with him financial expertise, as well as a senior management background and legal,
`
`Page 4 of 7
`
`

`
`regulatory and governance experience obtained while serving as General Counsel to a NYSE-listed financial services/insurance
`company. He currently serves on the Board of Directors of ACA Financial Guaranty Corporation, a diversified financial
`guaranty insurance company providing municipal bond insurance with a focus on marginal credits, and on the Board of
`Directors ofAllianz Life Insurance Company ofNew York, a life and annuity insurance company. Previously, Mr. Doyle served
`on the Board of Directors of Financial Guaranty Insurance Company fi'om January 2012 until June 2012. Until 201 1, Mr. Doyle
`served in various capacities at Ambac Financial Group, Inc. ("Ambac"), a financial services holding company, including Senior
`Vice President and General Counsel from 2000 until August, 201 1, Managing Director and General Counsel, Specialized
`Finance, from 1995 until 2000, and Vice President and Assistant General Counsel from 1991 to 1995. Mr. Doyle managed legal
`aspects of Ambac's $700 billion credit portfolio, which included a large portfolio of residential mortgage-backed securities.
`
`John S. Dubel. Mr. Dubel is the Chief Executive Officer of Dubel & Associates, LLC, a provider of restructuring and turnaround
`services to underperforming companies, which he founded in 1999. He has significant experience with originators and servicers
`of mortgages and 30 plus years of providing restructuring and turnaround services to underperforrning companies. Through
`Dubel & Associates he served as the Chief Executive Officer and member of the Board of Directors of FGIC Corporation, an
`insurance holding company, and Financial Guaranty Insurance Company, a monoline bond insurer, from December 2008 to
`December 2013, and as the sole independent member ofthe Board of Directors of Barneys New York, Inc., a national retail
`company, from February 2012 to May 2012 during their recapitalization. Mr. Dubel currently serves as the Chairman ofthe
`Board of Trustees ofthe ResCap Liquidating Trust, an entity set up to wind down the post-Chapter 1 1 assets of Residential
`Capital, LLC, one of the largest originators and servicers of residential mortgages and prior to that as the Co-Chair of the
`Official Committee ofUnsecured Creditors of Residential Capital, LLC, He also currently serves as an independent member of
`he boards of FXI Holdings, Inc., a leading producer of foam innovation products, and Werner Worldwide Holding Company,
`L.P., the leading provider of climbing equipment in the United States.
`
`Page 5 of 7
`
`

`
`A. Ja Me erson. Mr. Meyerson currently serves as an independent director on the Board of Directors ofAlly Bank, a wholly
`owned subsidiary of Ally Financial Inc., and is a member of the Risk and Compensation committees ofthe Board. He is also the
`owner of A. Jay Meyerson Consulting, a privately-owned management consulting firm specializing in financial services, bank
`merger acquisition and private equity investment evaluation. Prior to that, Mr. Meyerson served as the ChiefMarketing Ofiicer
`of GMAC, a holding company for diverse financial service businesses which is now known as Ally Financial Inc., fiom 2007 to
`2008. Previously, Mr. Meyerson served as the President and Chief Executive Officer of Aames Investment Corporation, a
`mortgage real estate investment trust, fiom 1999 to 2004, and as its Chairman ofthe Board and Chief Executive Officer from
`2004 to 2006. Aames Investment Corporation was acquired by Accredited Home Lenders Holding Co. in 2006. Mr. Meyerson
`served on the board of Accredited Home Lenders in 2006 and 2007. Mr. Meyerson held the position of Managing Director of
`KPMG, LLP, a U.S. audit, tax and advisory services finn, from 1997 to 1999. Mr. Meyerson additionally held various senior
`executive level positions at KeyCorp, one of the nation's largest bank-based financial services companies, and its subsidiaries
`and predecessors, since 1989. Mr. Meyerson was Chairman and Chief Executive Officer of KeyCorp's national consumer finance
`subsidiary, KeyBank USA/National Consumer Finance, from 1994 to 1997. He also served in the United States Army, Active
`and Reserves.
`
`Am C. Schumacher. Ms. Schumacher has extensive experience as a senior executive in the mortgage industry, including
`leading origination, servicing and capital markets organizations. She currently serves as the Chief Operating Officer of Prospect
`Mortgage, a residential retail mortgage lender, a position she has held since July 2013. Previously, she served in various
`capacities at Apollo Global Management ("Apollo"), an alternative investment manager in private equity, credit-oriented
`capital markets and real estate with $160 billion in assets under management, from 2007 until 2012, which included the role of
`Chief Executive Officer of Vantium Capital Inc., a de novo entity launched with Apollo to help lenders and investors optimize
`cash flow and resolve distressed mortgage debt. From 1997 until 2006, she served in various capacities at WMC Mortgage
`Corp, a wholesale originator of subprime residential mortgages, including as Chief Executive Officer from 2003 until 2006. Ms.
`Schumacher served on the Board of Directors of Source Corp., Inc., a business process outsourcing and consulting finn, a
`position she held from 2008 to 2013. Previously she served as a member ofthe Board of Directors of Bluebeam Software Corp
`from 2005 until 2012.
`
`CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
`
`The Mangrove Partners Master Fund, Ltd. ("Mangrove"), together with the other participants named herein, intends to make .
`preliminary filing with the Securities and Exchange Commission ("SEC") of a proxy statement and accompanying proxy card to
`be used to solicit votes for the election of a slate of director nominees at the 2015 annual meeting of shareholders of Home Loan
`Servicing Solutions, Ltd. (the "Company").
`
`MANGROVE STRONGLY ADVISES ALL SHAREHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT
`AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
`INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC'S WEB SITE AT
`
`HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE
`COPIES OF THE PROXY STATEMENT WITHOUT CHARGE UPON REQUEST.
`
`The participants in the proxy solicitation are anticipated to be Mangrove, The Mangrove Partners Fund, L.P. ("Mangrove LP"),
`Mangrove Partners Fund (Cayman), Ltd. ("Mangrove Fund Cayman"), Mangrove Partners, Mangrove Capital, Nathaniel August,
`Kevin J. Doyle, John S. Dubel, A. Jay Meyerson and Amy C. Schumacher (collectively, the "Participants").
`
`As ofthe date hereof, Mangrove owned 1,655,719 shares of the Company's Common Stock. As the two controlling shareholders
`of Mangrove, each ofMangrove LP and Mangrove Fund Cayman may be deemed the beneficial owner ofthe shares of Common
`Stock ofthe Company owned by Mangrove. Mangrove Partners is the investment manager of each of Mangrove, Mangrove LP
`and Mangrove Fund Cayman. Mangrove Capital is the general partner ofMangrove LP. Mr. August is the Director of each of
`Mangrove Partners and Mangrove Capital. By virtue of these relationships, each ofMangrove Partners, Mangrove Capital and
`Mr. August may be deemed to beneficially own the shares of Common Stock of the Company owned by Mangrove. As of the
`date hereof, none of Messrs. Doyle, Dubel or Meyerson nor Ms. Schumacher owned any shares of Common Stock ofthe
`Company.
`
`‘ bout Mangrove Partners
`
`Page 6 of 7
`
`

`
`Mangrove Partners is a value-oriented investment manager. Its investment objective is to organically compound net worth
`while minimizing the chances of a permanent loss of capital. Its goal is to generate positive returns from both long and short
`investments as opposed to employing a relative value or market hedging strategy.
`
`www.mangrovepartners.com
`
`Cautionary Statement Regarding Forward-Looking Statements
`
`The information herein contains "forward-looking statements." Specific forward-looking statements can be identified by the fact
`that they do not relate strictly to historical or current facts and include, without limitation, words such as "may," "will,"
`"expects," "believes," "anticipates," "plans," "estimates," "projects," "targets," "forecasts," "seeks," "could," "should" or the
`negative of such terms or other variations on such terms or comparable terminology. Similarly, statements that describe our
`objectives, plans or goals are forward-looking. Our forward-looking statements are based on our current intent, belief,
`expectations, estimates and projections regarding the Company and projections regarding the industry in which it operates.
`These statements are not guarantees of fiiture performance and involve risks, uncertainties, assumptions and other factors that are
`difficult to predict and that could cause actual results to differ materially. Accordingly, you should not rely upon forward-
`looking statements as a prediction of actual results and actual results may vary materially fiom what is expressed in or indicated
`by the forward-looking statements.
`
`SOURCE Mangrove Partners Master Fund, Ltd.
`
`Page 7 of 7
`
`Page 7 of 7