pmt-ex1016_119.htm

Amendment No. 2 to Second Amended and Restated Master Repurchase Agreement, dated as of April 26, 2019 (this “Amendment”), among Credit Suisse First Boston Mortgage Capital LLC (the “Administrative Agent”), Credit Suisse AG, a company incorporated in Switzerland, acting through its Cayman Islands Branch (a “Buyer”), Alpine Securitization LTD (a “Buyer”), PennyMac Operating Partnership, L.P. (the “Seller”) and PennyMac Mortgage Investment Trust (the “Guarantor”).

The Administrative Agent, the Buyers, the Seller and the Guarantor are parties to that certain (i) Second Amended and Restated Master Repurchase Agreement, dated as of April 28, 2017 (as amended by Amendment No. 1, dated as of April 27, 2018, the “Existing Repurchase Agreement”; and as further amended by this Amendment, the “Repurchase Agreement”) and (ii) the related Third Amended and Restated Pricing Side Letter, dated as of March 14, 2019 together with PennyMac Holdings, LLC (“PennyMac Holdings”), PennyMac Corp. (“PMC”), PMC REO Financing Trust, an asset subsidiary (the “Existing REO Subsidiary”) and PMC REO Trust 2015-1, as asset subsidiary (the “Joining REO Subsidiary”) (as amended, restated, supplemented or otherwise modified from time to time, the “Pricing Side Letter”), as each is assigned to Buyers. The Guarantor is party to that certain Amended and Restated Guaranty (as amended, restated, supplemented or otherwise modified from time to time, the “Guaranty”), dated as of April 28, 2017, by the Guarantor in favor of the Administrative Agent for the benefit of Buyers. Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Repurchase Agreement and Guaranty, as applicable.

The Administrative Agent, the Buyers, the Seller and the Guarantor have agreed, subject to the terms and conditions of this Amendment, that the Existing Repurchase Agreement be amended to reflect certain agreed upon revisions to the terms of the Existing Repurchase Agreement. As a condition precedent to amending the Existing Repurchase Agreement, the Administrative Agent and Buyers have required the Guarantor to ratify and affirm the Guaranty on the date hereof.

Accordingly, the Administrative Agent, the Buyers, the Seller and the Guarantor hereby agree, in consideration of the mutual promises and mutual obligations set forth herein, that the Existing Repurchase Agreement is hereby amended as follows:

SECTION 1.Definitions. Section 2 of the Existing Repurchase Agreement is hereby amended by:

1.1deleting the definition of “Termination Date” and replacing it with the following:

“Termination Date” means the earlier of (a) April 24, 2020, and (b) the date of the occurrence of an Event of Default.

“Successor Rate” means a rate determined by Administrative Agent in accordance with Section 5(c) hereof.

“Successor Rate Conforming Changes” means with respect to any proposed Successor Rate, any spread adjustments or other conforming changes to the timing and frequency of determining rates and making payments of interest and other administrative matters as may be appropriate, in the discretion of Administrative Agent, to reflect the adoption of such Successor Rate and to permit the administration thereof by Administrative Agent in a manner substantially consistent with market practice.

SECTION 2.Price Differential. Section 5 of the Existing Repurchase Agreement is hereby amended by adding the following new subsection (c) at the end thereof:

(c)If prior to any Price Differential Payment Date, Administrative Agent determines in its sole discretion that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining LIBOR, LIBOR is no longer in existence, or the administrator of LIBOR or a Governmental Authority having jurisdiction over Administrative Agent has made a public statement identifying a specific date after which LIBOR shall no longer be made available or used for determining the interest rate of loans, Administrative Agent may give prompt notice thereof to Seller, whereupon the rate for such period that will replace LIBOR for such period, and for all subsequent periods until such notice has been withdrawn by Administrative Agent, shall be the greater of (i) an alternative benchmark rate (including any mathematical or other adjustments to the benchmark rate (if any) incorporated therein) and (ii) zero, together with any proposed Successor Rate Conforming Changes, as determined by Administrative Agent in its sole discretion (any such rate, a “Successor Rate”). Any such determination of the Successor Rate shall be made by Administrative Agent in a manner substantially consistent with market practice with respect to similarly situated counterparties with substantially similar assets in similar facilities; provided, that the foregoing standard shall only apply to repurchase transactions that are under the supervision of Administrative Agent’s investment bank New York mortgage finance business that administers the Transactions.

SECTION 3.Representations and Warranties. Subsection 13(11) of the Existing Repurchase Agreement is hereby amended by deleting such subsection in its entirety and replacing it with the following:

(11)Litigation. Except as set forth on Exhibit E, there is no action, proceeding or investigation pending with respect to which either Seller or Guarantor has received service of process or, to the best of Seller’s or Guarantor’s knowledge threatened against it before any court, administrative agency or other tribunal (A) asserting the invalidity of any Program Agreement and any Transaction Request, (B) seeking to prevent the consummation of any of the transactions contemplated any Program Agreement and any Transaction Request, (C) making a claim individually or in the aggregate in an amount greater than (x) five percent (5%) of Guarantor’s Net Worth against Guarantor, Underlying Repurchase Counterparty or any of their Affiliates not otherwise identified herein, or (y) $10,000,000 against Seller, (D) which requires filing with the Securities and Exchange Commission in accordance with the 1934 Act or any rules thereunder or (E) which might materially and adversely affect the validity of the Mortgage Loans or the performance by it of its obligations under, or the validity or enforceability of any Program Agreement and any Transaction Request

SECTION 4.Covenants. Section 14 of the Existing Repurchase Agreement is hereby amended by:

4.1deleting subsection 14(a) in its entirety and replacing it with the following:

(a)Litigation. Seller and Guarantor, as applicable, will promptly, and in any event within ten (10) days after service of process on any of the following, give to Administrative Agent notice of all litigation, actions, suits, arbitrations, investigations (including, without limitation, any of the foregoing which are threatened or pending) or other legal or arbitrable proceedings affecting Seller, Guarantor or any of their Subsidiaries or affecting any of the Property of any of them before any Governmental Authority that (i) questions or challenges the validity or enforceability of any of the Program Agreements or any action to be taken in connection with the transactions contemplated hereby, (ii) makes a claim individually or in the aggregate in an amount greater than (x) five percent (5%) of Guarantor’s Net Worth against Guarantor, Underlying Repurchase Counterparty or any of their Affiliates not otherwise identified herein or (y) $10,000,000 against Seller, or (iii) which, individually or in the aggregate, if adversely determined, could be reasonably likely to have a Material Adverse Effect with respect to Seller or Guarantor. Seller and Guarantor, as applicable, will promptly provide notice of any judgment, which with the passage of time, could cause an Event of Default hereunder.

4.2deleting subsection (ee) in its entirety and replacing it with the following:

SECTION 5.Conditions Precedent to Amendment. This Amendment shall become effective as of the date hereof (the “Amendment Effective Date”), subject to the satisfaction of the following conditions precedent:

5.1Delivered Documents. On the Amendment Effective Date, the Administrative Agent on behalf of the Buyers shall have received the following documents, each of which shall be satisfactory to the Administrative Agent in form and substance:

(a)this Amendment, executed and delivered by duly authorized officers of the Administrative Agent, the Buyers, the Seller and the Guarantor;

(b)Amendment No. 1 to Third Amended and Restated Pricing Side Letter, executed and delivered by duly authorized officers of the Administrative Agent, the Buyers, the Seller, PennyMac Holdings, LLC, PennyMac Corp., PMC REO Financing Trust, PMC REO Trust 2015-1 and Guarantor; and

(c)such other documents as the Administrative Agent or counsel to the Administrative Agent may reasonably request.

SECTION 6.Representations and Warranties. Seller hereby represents and warrants to the Administrative Agent and the Buyers that it is in compliance with all the terms and provisions set forth in the Repurchase Agreement on its part to be observed or performed, and that no Event of Default has occurred or is continuing, and hereby confirms and reaffirms the representations and warranties contained in Section 13 of the Repurchase Agreement.

SECTION 7.Limited Effect. Except as expressly amended and modified by this Amendment, the Existing Repurchase Agreement shall continue to be, and shall remain, in full force and effect in accordance with its terms.

SECTION 8.Counterparts. This Amendment may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Amendment in Portable Document Format (PDF) or by facsimile shall be effective as delivery of a manually executed original counterpart of this Amendment.

SECTION 9.Severability. Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.

SECTION 10.GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE CHOICE OF LAW PROVISIONS THEREOF.

SECTION 11.Reaffirmation of Guaranty. The Guarantor hereby ratifies and affirms all of the terms, covenants, conditions and obligations of the Guaranty and acknowledges and agrees that the term “Obligations” as used in the Guaranty shall apply to all of the Obligations of Seller to Administrative Agent and Buyers under the Repurchase Agreement and related Program Agreements, as amended hereby.

IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed as of the date first above written.

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC, as Administrative Agent

By:		/s/ Margaret Dellafera
		Name: Margaret Dellafera
		Title: Vice President

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Buyer

By:		/s/ Margaret Dellafera
		Name: Margaret Dellafera
		Title: Authorized Signatory

By:		/s/ Charles Trombley
		Name: Charles Trombley
		Title: Authorized Signatory

ALPINE SECURITIZATION LTD, as a Buyer, by Credit Suisse AG, New York Branch as Attorney-in-Fact

By:		/s/ Kenneth Aiani
		Name: Kenneth Aiani
		Title: Vice President

By:		/s/Patrick J. Hart
		Name: Patrick J. Hart
		Title: Director

Signature Page to Amendment No. 2 to Second Amended and Restated Master Repurchase Agreement

PENNYMAC OPERATING PARTNERSHIP, L.P., as Seller

By:		PennyMac GP OP, Inc., its General Partner

By:		/s/ Pamela Marsh
		Name: Pamela Marsh
		Title: Managing Director, Treasurer

PENNYMAC MORTGAGE INVESTMENT TRUST, as Guarantor

By:		/s/ Pamela Marsh
		Name: Pamela Marsh
		Title: Managing Director, Treasurer

Signature Page to Amendment No. 2 to Second Amended and Restated Master Repurchase Agreement