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Section 1: 8-K (8-K)

PFSI Form 8-K (04-01-20)

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): April 1, 2020

 

PennyMac Financial Services, Inc.

(formerly known as New PennyMac Financial Services, Inc.)

(Exact name of registrant as specified in its charter)

 

 

 

 

 

Delaware

001-38727

83-1098934

(State or other jurisdiction

(Commission

(IRS Employer

of incorporation)

File Number)

Identification No.)

 

 

 

3043 Townsgate Road, Westlake Village, California

91361

(Address of principal executive offices)

(Zip Code)

 

(818) 224‑7442

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

 

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.0001 par value

PFSI

New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Item 1.01    Entry into a Material Definitive Agreement.

 

On April 1, 2020, PennyMac Financial Services, Inc. (the “Company”), through two of its indirect, wholly owned subsidiaries,  PNMAC GMSR ISSUER TRUST (“Issuer Trust”) and PennyMac Loan Services, LLC (“PLS”), and its direct wholly owned subsidiary, Private National Mortgage Acceptance Company, LLC (“PNMAC”), issued a series of variable funding notes, the Series 2020-SPIADVF1 Notes (“GMSR Servicing Advance Notes”), to be sold under agreement to repurchase pursuant to a Master Repurchase Agreement, dated as of April 1, 2020, with Credit Suisse First Boston Mortgage Capital LLC (“CSFB”), acting as administrative agent on behalf of Credit Suisse AG, Cayman Islands Branch (“CSCIB”), as buyer (the “GMSR Servicing Advances Repurchase Agreement”). 

 

The purpose of the GMSR Servicing Advances Repurchase Agreement is to provide PLS with financing secured by its servicing advances to pay, in accordance with the Ginnie Mae requirements,  in the event borrowers are delinquent: (i) regularly scheduled monthly principal and bond interest to mortgage-backed securities holders (“MBS Advances”); (ii) taxes, homeowner’s insurance, and other escrowed items (“Escrow Advances”); and (iii) other expenses related to servicing delinquent loans as specified by (A) state and federal laws and (B) government agencies, including the Federal Housing Administration (“FHA”), the Veterans Administration (“VA”), and the United States Department of Agriculture (“USDA”)(“Corporate Advances” and, together with MBS Advances and Escrow Advances, “Servicing Advances”). PLS already finances the related Ginnie Mae mortgage servicing rights (“MSRs”), together with excess servicing spread relating to such MSRs (“Excess Spread”), pursuant to a series of structured finance transactions (the “GMSR Servicing Spread Facility”) secured by certain participation certificates relating to the MSRs and Excess Spread.

 

In addition to the GMSR Servicing Advances Repurchase Agreement, CSFB, CSCIB and, in one case, another CSFB affiliate, Alpine Securitization LTD, (“Alpine”) provide four other credit facilities to PLS: (i)  a  Third Amended and Restated Master Repurchase Agreement, dated as of April 28, 2017, with CSFB, acting as administrative agent for CSCIB, as a buyer, and Alpine, as a buyer (the “CS Loan Repurchase Agreement”) that PLS uses primarily to finance newly originated mortgage loans; or, (ii) a Master Repurchase Agreement, dated as of December 19, 2016, among  CSFB, CSCIB, and PLS (“the “GMSR Servicing Spread Repurchase Agreement”) that, together with term notes issued by the Issuer Trust (“Term Notes”), comprises the GMSR Servicing Spread Facility; (iii) a Master Repurchase Agreement, dated as of September 11, 2019, among CSFB, CSCIB, PLS and PNMAC that PLS uses to finance Fannie Mae mortgage servicing rights (the “Fannie Mae MSR PC Agreement”), and (iv) a Loan and Security Agreement, dated as of February 1, 2018, among  CSFB, CSCIB, PLS and PNMAC that PLS uses to finance Freddie Mac mortgage servicing rights (the “Freddie Mac MSR Loan Agreement”) (collectively, these five credit facilities are referred to as the “CS Facilities”). All five of the CS Facilities are committed through April 24, 2020 and negotiations for renewal are currently in progress.

 

The GMSR Servicing Advance Notes are entitled to distributions from reimbursements received by PLS relating to Servicing Advances made by PLS on Ginnie Mae MSRs, and, during the full amortization period of the Term Notes or upon an event of default, the GMSR Servicing Advance Notes rank pari passu with (i) the Term Notes; and (ii) the GMSR Servicing Spread Repurchase Agreement based on the series invested amount and are secured by participation certificates on the MSRs, Excess Spread, and Servicing Advances. The Servicing Advances eligible for financing include MBS Advances, Corporate Advances and Escrow Advances, subject to certain other eligibility criteria specified by CSFB and CSCIB.

 

The obligations of PLS under both the GMSR Servicing Spread Repurchase Agreement and the GMSR Servicing Advances Repurchase Agreement are fully guaranteed by PNMAC pursuant to an Amended and Restated Guaranty, dated April 1, 2020 by PLS and PNMAC (“GMSR VFN Guaranty”).

 

Amendment No. 9 to CS Loan Repurchase Agreement

 

The purpose of Amendment No. 9 to the CS Loan Repurchase Agreement (“CS Loan Amendment”) is to include the maximum purchase price and maximum committed purchase price available under the GMSR Servicing Advances Repurchase Agreement within  (i) the maximum combined purchase price of $2.0 billion; and (ii) the maximum combined committed purchase price of $700 million, in each case that apply to PLS across the other CS Facilities.  The GMSR Servicing Advances Repurchase Agreement is also added to the cross default provision across the other CS Facilities.  All other terms and conditions of the CS Loan Repurchase Agreement, the Freddie Mac MSR Loan Agreement, and the Fannie Mae MSR PC Agreement remain the same in all material respects.

 

New Series 2020-SPIADVF1 Indenture Supplement

 

The GMSR Servicing Advance Notes have a maximum principal balance of $1,000,000,000, with funds available to PLS based on (i) the advance rates set forth in the Series 2020-SPIADVF1 Indenture Supplement, dated as of April 1, 2020, by and among Issuer Trust, Citibank, N.A., as indenture trustee, as calculation agent, as paying agent and as securities intermediary, PLS, and CSFB, as administrative agent (the “Servicing Advance Indenture Supplement”), (ii) the asset value of the Servicing Advance participation certificates as determined under the GMSR Servicing Advances Repurchase Agreement, and (iii) the maximum purchase price and maximum committed purchase price available at such time.  The advance rates vary based on (i) whether the Servicing Advance is an MBS Advance, Escrow Advance or Corporate Advance, (ii) whether such Servicing Advance relates to an FHA loan, VA loan, and USDA or other loan, and (iii) either the delinquency status of the loan or the weighted average delinquency of the loans for the applicable Servicing Advance type.  The advance rates are also subject to certain advance rate reduction event triggers, including (i)  in the event a monthly MBS Advance remains outstanding for more than twenty-nine (29) days from the date of such monthly MBS Advance, (ii) the failure to maintain certain quarterly ratios of cumulative non-recoverable Servicing Advances to the aggregate amount of Servicing Advances for each Servicing Advance type, or (iii) the occurrence of an advance rate reduction event under the GMSR Servicing Spread Facility.

 

Prior to the full amortization period of the Term Notes,  interest on the GMSR Servicing Advance Notes and the corresponding purchase price paid to PLS under the GMSR Servicing Advances Repurchase Agreement are payable on an interim payment date, on the third business day of each week, and a monthly payment date, beginning in April 2020, on the 25th day of such month or, if such 25th day is not a business day, the next business day. PLS is also permitted to pay down daily the GMSR Servicing Advances Facility directly to CSCIB, as the holder of the GMSR Servicing Advance Note, potentially reducing monthly interest expense related to financing of the MBS Advances. During the full amortization period of the Term Notes or following an event of default under the GMSR Servicing Spread Facility or the GMSR Servicing Advances Facility,  the GMSR Servicing Advance Repurchase Agreement ranks pari passu with (i) the Term Notes; and (ii) the GMSR Servicing Spread Repurchase Agreement, based on the series invested amount, with respect to all collections on the participation certificates related to the MSRs, Excess Spread, and Servicing Advances.  To the extent any MBS Advance reimbursement amounts funded under the Series GMSR Servicing Advance Notes are recovered in the prior week, on the third business day of such week, PLS is required to transfers the portion of those amounts financed and accrued interest to the paying agent to pay down the GMSR Servicing Advance Notes unless previously paid directly to CSCIB.

 

New Series 2020-SPIADVF1 Repurchase Agreement

 

The maximum purchase price and maximum committed purchase prices available to PLS under the GMSR Servicing Advances Repurchase Agreement are each $400 million, which are reduced to the extent that the combined borrowed and/or purchased amounts outstanding under (i)  all of the CS Facilities exceed (A) a maximum combined purchase price of $2.0 billion, or (B) a maximum combined committed purchase price of $700 million, or (ii) the GMSR Servicing Advances Repurchase Agreement, Freddie Mac MSR Loan Agreement, and the Fannie Mae MSR PC Agreement exceed $400 million. The GMSR Servicing Spread Repurchase Agreement separately requires PLS to maintain outstanding advances of at least $50 million to avoid triggering an advance rate reduction event under the Term Notes.

 

The principal amount paid by CSCIB for the GMSR Servicing Advance Note is based upon a percentage of the purchase price of such GMSR Servicing Advance Note.   Upon PLS’ repurchase of the GMSR Servicing Advance Note, PLS is required to repay CSCIB the principal amount relating thereto plus accrued interest (at a rate reflective of the current market) to the date of such repurchase.  PLS is also required to pay CSCIB a fee for the structuring of the GMSR Servicing Advance Repurchase Agreement as well as certain other administrative costs and expenses in connection with CSFB’s management and ongoing administration of the GMSR Servicing Advance Repurchase Agreement.

 

The GMSR Servicing Advance Repurchase Agreement contains margin call provisions that provide CSCIB with certain rights in the event of a decline in the asset value of the purchased GMSR Servicing Advance Note. Under these provisions, CSCIB may require PLS to transfer cash or additional eligible assets into the Issuer Trust for the benefit of CSCIB with an aggregate asset value in an amount sufficient to eliminate any margin deficit resulting from such a decline.

 

The GMSR Servicing Advance Repurchase Agreement requires that PLS make certain representations, warranties and covenants customary for this type of transaction, including certain financial covenants consistent with the GMSR Servicing Spread Repurchase Agreement. The GMSR Servicing Advance Note also serves as cross-collateral for PLS’ obligations under the other CS Facilities.

 

The GMSR Servicing Advance Repurchase Agreement contains events of default (subject to certain materiality thresholds and grace periods), including payment defaults, breaches of covenants and/or certain representations and warranties, cross-defaults, guarantor defaults, bankruptcy or insolvency proceedings and other events of default, which are customary for this type of transaction and similar to those under the GMSR Servicing Spread Repurchase Agreement. The remedies for such events of default include the acceleration of the principal amount outstanding under the GMSR Servicing Advance Repurchase Agreement, the liquidation by CSCIB of the GMSR Servicing Advance Note, and the right of CSCIB to exercise certain of PLS’ rights related to the owner trust certificate in the Issuer Trust.

 

Third Amended and Restated Base Indenture

 

The first GMSR Servicing Advance Note is issued pursuant to (i)  the terms of the Third Amended and Restated Base Indenture, dated as of April 1, 2020 (the “Amended Base Indenture”), by and among the Issuer Trust, Citibank, N.A., as indenture trustee, calculation agent, paying agent and securities intermediary (the “Indenture Trustee”), PLS, as the servicer and administrator, CSFB, as administrative agent, and Pentalpha Surveillance LLC, as credit manager; and (ii) the Servicing Advance Indenture Supplement.

 

The Amended Base Indenture was amended and restated to: (i)  allow the participation certificates relating to the Servicing Advances to be pledged; and (ii) to add related financing mechanics, some of which are also in the Issuer Trust PC Repurchase Agreement (defined below) and GMSR Servicing Advance Repurchase Agreement.

 

Amended and Restated Issuer Trust PC Repurchase Agreement

 

The Amended and Restated Master Repurchase Agreement, dated as of April 1, 2020, by and among the Issuer Trust, PLS and PNMAC (“Issuer Trust PC Repurchase Agreement”),  includes changes pursuant to which  (i) PLS granted to the Issuer Trust a security interest in all of its right, title and interest in, to and under the newly created participation certificates representing beneficial interests in the Servicing Advances, including all of its rights and interests to Servicing Advances in any MSRs and Excess Spread it thereafter owns or acquires, and (ii) in return, the Issuer Trust issued to PLS the GMSR Servicing Advance Note, with the same remedies and events of default applicable to the Servicing Advance participation certificates as those that apply to the MSR and Excess Spread participation certificates.

 

The Issuer Trust PC Repurchase Agreement was also amended and restated to (i)  incorporate the new Servicing Advance participation certificates, (ii) set forth specific conditions and required reserve amounts for the MBS Advance reimbursement amounts and Escrow Advance and Corporate Advance reimbursement amounts before PLS is permitted to offset, net, withdraw or direct the withdrawal or remittance of any amounts which have been or are to be deposited into the dedicated account; (iii) provide for the mechanics related to the sweeping of the Servicing Advance reimbursement amounts. The obligations of PLS are guaranteed in full by PNMAC.

 

Amended and Restated Guaranty

 

The GMSR VFN Guaranty adds the obligations of PLS under the GMSR Servicing Advances Repurchase Agreement to the previous guaranty provided by PNMAC relating to the GMSR Servicing Spread Repurchase Agreement.

 

The foregoing descriptions of (i) the GMSR Servicing Advances Repurchase Agreement (including the GMSR Servicing Advances Notes) and the GMSR VFN Guaranty; (ii) the CS Loan Repurchase Agreement; (iii) the CS Loan Amendment; (iv) the GMSR Servicing Spread Repurchase Agreement; (v) the Fannie Mae MSR PC Agreement; (vi) the Freddie Mac MSR Loan Agreement; (vii) the Servicing Advance Indenture Supplement; (viii) the Third Amended and Restated Base Indenture; and (ix) the Issuer Trust PC Repurchase Agreement do not purport to be complete and are qualified in their entirety by reference to the following: (i) the full text of the Master Repurchase Agreement and the Amended and Restated Guaranty, which have been filed with this Current Report on Form 8-K as Exhibit 10.1 and Exhibit 10.2, respectively;  (ii) the description of the CS Loan Repurchase Agreement in the Company’s Current Report on Form 8-K as filed with the Securities and Exchange Commission (the “SEC”) on May 3, 2017, including the full text of the Third Amended and Restated Master Repurchase Agreement and the related guaranty attached thereto as Exhibit 10.1 and Exhibit 10.2, respectively; (iii) the full text of Amendment No. 9 to Third Amended and Restated Master Repurchase Agreement, which has been filed with this Current Report on Form 8-K as Exhibit 10.3; (iv) the description of the GMSR Servicing Spread Repurchase Agreement in the Company’s Current Report on Form 8-K as filed with the SEC on December 21, 2016, including the full text of the Master Repurchase Agreement and the related guaranty attached thereto as Exhibit 10.3 and Exhibit 10.4, respectively; (v) the description of the Fannie Mae MSR PC Agreement in the Company’s Quarterly Report on Form 10-Q as filed with the SEC on November 4, 2019, including the full text of the Master Purchase Agreement attached thereto as Exhibit 10.11; (vi) the description of the Freddie Mac MSR Loan Agreement in the Company’s Current

Report on Form 8-K as filed with the SEC on February 7, 2018, including the full text of the Loan and Security Agreement attached thereto as Exhibit 10.1; (vii) the full text of Series 2020-SPIADVF1 Indenture Supplement, which has been filed with this Current Report on Form 8-K as Exhibit 10.4; (viii) the full text of the Third Amended and Restated Base Indenture, which has been filed with this Current Report on Form 8-K as Exhibit 10.5; (ix) the full text of the Issuer Trust PC Repurchase Agreement, which has been filed with this Current Report on Form 8-K as Exhibit 10.6; (x) the full text of all other amendments to the foregoing filed thereafter with the SEC.

 

Item 2.03    Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.    

 

Item 9.01    Financial Statements and Exhibits.

 

(d)  Exhibits.

 

 

 

10.1

Master Repurchase Agreement, dated as of April 1, 2020, by and among Credit Suisse First Boston Mortgage Capital LLC, Credit Suisse AG, Cayman Islands Branch, and PennyMac Loan Services, LLC

10.2

Amended and Restated Guaranty, dated April 1, 2020, made by Private National Mortgage Acceptance Company, LLC in favor of Credit Suisse First Boston Mortgage Capital LLC

10.3

Amendment No. 9 to Third Amended and Restated Master Repurchase Agreement, dated as of April 1, 2020, among Credit Suisse First Boston Mortgage Capital LLC, Credit Suisse AG, Cayman Islands Branch, Alpine Securitization LTD, PennyMac Loan Services, LLC and Private National Mortgage Acceptance Company, LLC

10.4

Series 2020-SPIADVF1 Indenture Supplement, dated as of April 1, 2020, to Third Amended and Restated Base Indenture, dated as of April 1, 2020, by and among PNMAC GMSR ISSUER TRUST, Citibank, N.A., PennyMac Loan Services, LLC and Credit Suisse First Boston Mortgage Capital LLC 

10.5

Third Amended and Restated Base Indenture, dated as of April 1, 2020, by and among PNMAC GMSR ISSUER TRUST, Citibank, N.A., PennyMac Loan Services, LLC, Credit Suisse First Boston Mortgage Capital LLC and Pentalpha Surveillance LLC

10.6

Amended and Restated Master Repurchase Agreement, dated as of April 1, 2020, by and among PNMAC GMSR ISSUER TRUST, PennyMac Loan Services, LLC and Private National Mortgage Acceptance Company, LLC

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

 

PENNYMAC FINANCIAL SERVICES, INC.

 

 

 

 

 

 

Dated:  April 7, 2020

/s/ Andrew S. Chang

 

Andrew S. Chang

Senior Managing Director and Chief Financial Officer

 

 

 

 

(Back To Top)

Section 2: EX-10.1 (EX-10.1)

10.1 GMSR VF1 MRA

Exhibit 10.1

EXECUTION VERSION

 

 

 

 

 

MASTER REPURCHASE AGREEMENT

among

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC, as administrative agent
(“Administrative Agent”)

and

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as buyer (“Buyer”)

and

PENNYMAC LOAN SERVICES, LLC, as seller (“Seller”)

 

Dated as of April 1, 2020

PNMAC GMSR ISSUER TRUST

MSR COLLATERALIZED NOTES,

SERIES 2020-SPIADVF1

 

 

 

 

 

 

TABLE OF CONTENTS

 

 

 

Page

ARTICLE I

DEFINITIONS

1

Section 1.01

Certain Defined Terms

1

Section 1.02

Other Defined Terms

12

 

 

 

ARTICLE II

GENERAL TERMS

13

Section 2.01

Transactions

13

Section 2.02

Procedure for Entering into Transactions

13

Section 2.03

Repurchase; Payment of Repurchase Price

13

Section 2.04

Price Differential

14

Section 2.05

Margin Maintenance

14

Section 2.06

Payment Procedure

14

Section 2.07

Application of Payments

15

Section 2.08

Use of Purchase Price and Transaction Requests

15

Section 2.09

Recourse

15

Section 2.10

Requirements of Law

15

Section 2.11

Taxes

17

Section 2.12

Indemnity

18

Section 2.13

Additional Balance

18

Section 2.14

Commitment Fee

18

Section 2.15

Termination

18

 

 

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES

19

Section 3.01

Seller Existence

19

Section 3.02

Licenses

19

Section 3.03

Power

19

Section 3.04

Due Authorization

19

Section 3.05

Financial Statements

20

Section 3.06

No Event of Default

20

Section 3.07

Solvency

20

Section 3.08

No Conflicts

21

Section 3.09

True and Complete Disclosure

21

Section 3.10

Approvals

21

Section 3.11

Litigation

21

Section 3.12

Material Adverse Change

21

Section 3.13

Ownership

21

Section 3.14

The Note

22

Section 3.15

Taxes

22

 

 

 

 

 

 

Section 3.16

Investment Company

22

Section 3.17

Chief Executive Office; Jurisdiction of Organization

23

Section 3.18

Location of Books and Records

23

Section 3.19

ERISA

23

Section 3.20

Financing of Note and Additional Balances

23

Section 3.21

Agreements

23

Section 3.22

Other Indebtedness

23

Section 3.23

No Reliance

23

Section 3.24

Plan Assets

24

Section 3.25

No Prohibited Persons

24

Section 3.26

Compliance with 1933 Act

24

 

 

 

ARTICLE IV

CONVEYANCE; REPURCHASE ASSETS; SECURITY INTEREST

24

Section 4.01

Ownership

24

Section 4.02

Security Interest

24

Section 4.03

Further Documentation

26

Section 4.04

Changes in Locations, Name, etc

26

Section 4.05

Performance by Buyer of Seller’s Obligations

26

Section 4.06

Proceeds

27

Section 4.07

Remedies

27

Section 4.08

Limitation on Duties Regarding Preservation of Repurchase Assets

28

Section 4.09

Powers Coupled with an Interest

28

Section 4.10

Release of Security Interest

28

Section 4.11

Reinstatement

28

 

 

 

ARTICLE V

CONDITIONS PRECEDENT

28

Section 5.01

Initial Transaction

28

Section 5.02

All Transactions

29

Section 5.03

Closing Subject to Conditions Precedent

30

 

 

 

ARTICLE VI

COVENANTS

33

Section 6.01

Litigation

33

Section 6.02

Prohibition of Fundamental Changes

33

Section 6.03

Weekly Reporting

33

Section 6.04

No Adverse Claims

34

Section 6.05

Assignment

34

Section 6.06

Security Interest

34

Section 6.07

Records

34

Section 6.08

Books

34

Section 6.09

Approvals

34

 

-ii-

 

Section 6.10

Material Change in Business

35

Section 6.11

Distributions

35

Section 6.12

Applicable Law

35

Section 6.13

Existence

35

Section 6.14

Chief Executive Office; Jurisdiction of Organization

35

Section 6.15

Taxes

35

Section 6.16

Transactions with Affiliates

35

Section 6.17

Guarantees

35

Section 6.18

Indebtedness

35

Section 6.19

True and Correct Information

35

Section 6.20

No Pledge

36

Section 6.21

Plan Assets

36

Section 6.22

Sharing of Information

36

Section 6.23

Modification of the Base Indenture and Series 2020-SPIADVF1 Indenture Supplement

36

Section 6.24

Reporting Requirements

36

Section 6.25

Liens on Substantially All Assets

38

Section 6.26

Litigation Summary

38

Section 6.27

Hedging

39

Section 6.28

[Reserved]

39

Section 6.29

Most Favored Status

39

 

 

 

ARTICLE VII

DEFAULTS/RIGHTS AND REMEDIES OF BUYER UPON DEFAULT

39

Section 7.01

Events of Default

39

Section 7.02

No Waiver

41

Section 7.03

Due and Payable

41

Section 7.04

Fees

42

Section 7.05

Default Rate

42

 

 

 

ARTICLE VIII

ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS; SEPARATE ACTIONS BY BUYER

42

Section 8.01

Entire Agreement

42

Section 8.02

Waivers, Separate Actions by Buyer

42

 

 

 

ARTICLE IX

SUCCESSORS AND ASSIGNS

43

Section 9.01

Successors and Assigns

43

Section 9.02

Participations and Transfers

43

Section 9.03

Buyer and Participant Register

44

 

-iii-

 

 

 

 

 

 

 

ARTICLE X

MISCELLANEOUS

44

Section 10.01

Survival

44

Section 10.02

Indemnification

44

Section 10.03

Nonliability of Buyer

45

Section 10.04

Governing Law; Submission to Jurisdiction; Waivers

45

Section 10.05

Notices

47

Section 10.06

Severability

48

Section 10.07

Section Headings

48

Section 10.08

Counterparts

48

Section 10.09

Periodic Due Diligence Review

48

Section 10.10

Hypothecation or Pledge of Repurchase Assets

49

Section 10.11

Non-Confidentiality of Tax Treatment

49

Section 10.12

Set-off

50

Section 10.13

Intent

50

 

 

 

 

 

Schedule 1

Responsible Officers of Seller

 

 

 

Schedule 2

Asset Schedule

 

 

 

Schedule 3

Buyer Account

 

 

 

Exhibit A

Form of Transaction Notice

 

 

 

Exhibit B

Existing Indebtedness

 

 

 

-iv-

 

MASTER REPURCHASE AGREEMENT

This Master Repurchase Agreement (as the same may be amended, restated, supplemented or otherwise modified from time to time, this “Agreement”) is made as of April 1, 2020, among CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC (“CSFB”), as administrative agent (the “Administrative Agent”), CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH (“CSCIB”), as buyer (“Buyer”), and PENNYMAC LOAN SERVICES, LLC, as seller (“Seller” or “PLS”).

W I T N E S S E T H  :

WHEREAS, from time to time the parties hereto may enter into transactions in which Seller agrees to transfer to Buyer a certain Note (as defined below) against the transfer of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such Note at a date certain or on demand, against the transfer of funds by Seller.  Each such transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be governed by this Agreement, including any supplemental terms or conditions contained in any annexes identified herein, as applicable hereunder;

WHEREAS, pursuant to the Base Indenture (as defined below) and the Series 2020-SPIADVF1 Indenture Supplement (as defined below), PNMAC GMSR ISSUER TRUST (the “Issuer”) has duly authorized the issuance of a Series of Notes, as a single Class of Variable Funding Note, known as the “PNMAC GMSR ISSUER TRUST MSR Collateralized Notes, Series 2020-SPIADVF1” (the “Note”);

WHEREAS, Seller is the owner of the Note; and

WHEREAS, Seller wishes to sell the Note to Buyer pursuant to the terms of this Agreement;

NOW, THEREFORE, in consideration of the mutual agreements set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller hereby agree as follows.

ARTICLE I

 

DEFINITIONS

Section 1.01       Certain Defined Terms.  Capitalized terms used herein shall have the indicated meanings:

1933 Act” means the Securities Act of 1933, as amended from time to time.

1934 Act” means the Securities Exchange Act of 1934, as amended from time to time.

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Act of Insolvency” means, with respect to any Person or its Affiliates, (i) the filing of a petition, commencing, or authorizing the commencement of any case or proceeding, or the voluntary joining of any case or proceeding under any bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law relating to the protection of creditors, or suffering any such petition or proceeding to be commenced by another which is consented to, not timely contested or results in entry of an order for relief; (ii) the seeking of the appointment of a receiver, trustee, custodian or similar official for such party or an Affiliate or any substantial part of the property of either; (iii) the appointment of a receiver, conservator, or manager for such party or an Affiliate by any governmental agency or authority having the jurisdiction to do so; (iv) the making or offering by such party or an Affiliate of a composition with its creditors or a general assignment for the benefit of creditors; (v) the admission by such party or an Affiliate of such party of its inability to pay its debts or discharge its obligations as they become due or mature; or (vi) that any governmental authority or agency or any person, agency or entity acting or purporting to act under governmental authority shall have taken any action to condemn, seize or appropriate, or to assume custody or control of, all or any substantial part of the property of such party or of any of its Affiliates, or shall have taken any action to displace the management of such party or of any of its Affiliates or to curtail its authority in the conduct of the business of such party or of any of its Affiliates.

Additional Balance” has the meaning set forth in Section 2.13.

Additional Repurchase Assets” has the meaning set forth in Section 4.02(c).

Administrative Agent” has the meaning given to such term in the preamble to this Agreement.

Affiliate” means, with respect to any Person, any “affiliate” of such Person, as such term is defined in the Bankruptcy Code; provided,  however, that in respect of Seller the term “Affiliate” shall include only PNMAC and its wholly owned subsidiaries.

Agreement” has the meaning given to such term in the preamble to this Agreement.

Applicable Lending Office” means the “lending office” of Buyer (or of an Affiliate of Buyer) designated in Section 10.05 hereof or such other office of Buyer (or of an Affiliate of Buyer) as Buyer may from time to time specify to Seller in writing as the office by which the Transactions are to be made and/or maintained.

Asset Schedule” means Schedule 2 attached hereto, which lists the Note and the terms thereof, as such schedule shall be updated from time to time in accordance with Section 2.02 hereof, including without limitation, in connection with Buyer’s approval of any Additional Balances pursuant to Section 2.13.

Asset Value” has the meaning assigned to such term in the Pricing Side Letter.

Bankruptcy Code” means the United States Bankruptcy Code of 1978, as amended from time to time.

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Base Indenture” means the Third Amended and Restated Base Indenture, dated as of April 1, 2020, among Buyer, Citibank, N.A., as indenture trustee, as calculation agent, as paying agent and as securities intermediary, Seller, as administrator and as servicer, CSFB, as administrative agent, and the Credit Manager, including the schedules and exhibits thereto, as amended, restated, supplemented or otherwise modified from time to time.

Base Rate”  has the meaning assigned to the term in the Pricing Side Letter.

Business Day” means any day other than (i) a Saturday or Sunday or (ii) any other day on which national banking associations or state banking institutions in New York, New York, the State of California, the city and state where the Corporate Trust Office is located or the Federal Reserve Bank of New York, are authorized or obligated by law, executive order or governmental decree to be closed.

Buyer” means CSCIB, together with its successors, and any assignee of and Participant or Transferee in the Transaction.

Buyer Account”  means the account identified on Schedule 3 hereto.

Capital Lease Obligations” means, for any Person, all obligations of such Person to pay rent or other amounts under a lease of (or other agreement conveying the right to use) Property to the extent such obligations are required to be classified and accounted for as a capital lease on a balance sheet of such Person under GAAP, and, for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP.

Change in Control” occurs if any of the following occur:

(A)       any transaction or event as a result of which PNMAC ceases to own, beneficially or of record, 100% of the stock of Seller, except with respect to an initial public offering of Seller’s common stock on a U.S. national securities exchange;

(B)       the sale, transfer, or other disposition of all or substantially all of Seller’s or PNMAC’s assets (excluding any such action taken in connection with any securitization transaction); or

(C)       the consummation of a merger or consolidation of Seller or PNMAC with or into another entity or any other corporate reorganization, if more than 50% of the combined voting power of the continuing or surviving entity’s stock outstanding immediately after such merger, consolidation or such other reorganization is owned by Persons who were not stockholders of Seller or PNMAC immediately prior to such merger, consolidation or other reorganization.

Closing Date” means April 1, 2020.

Code” means the Internal Revenue Code of 1986, as amended from time to time.

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Commitment” means the obligation of Buyer to enter into Transactions with Seller with an aggregate outstanding Purchase Price at any one time not to exceed the Maximum Purchase Price.

Commitment Fee” has the meaning assigned to the term in the Pricing Side Letter.

Commitment Period” means the period from and including the Closing Date to but not including the Termination Date or such earlier date on which the Commitment shall have terminated pursuant to this Agreement.

Confidential Information” has the meaning set forth in Section 10.11(b).

Control”, “Controlling” or “Controlled” means the possession of the power to direct or cause the direction of the management or policies of a Person through the right to exercise voting power or by contract, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

Credit Manager” means Pentalpha Surveillance LLC and any successor thereto in such capacity.

CSCIB” has the meaning given to such term in the preamble to this Agreement.

CSFB” has the meaning given to such term in the preamble to this Agreement.

Default” means an event, condition or default that, with the giving of notice, the passage of time, or both, would constitute an Event of Default.

Dollars” and “$” means dollars in lawful currency of the United States of America.

EO13224” has the meaning set forth in Section 3.25.

ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

ERISA Affiliate” means any corporation or trade or business that, together with Seller or PNMAC is treated as a single employer under Section 414(b) or (c) of the Code or solely for purposes of Section 302 of ERISA and Section 412 of the Code is treated as single employer described in Section 414 of the Code.

ERISA Event of Termination” means with respect to Seller or PNMAC (i) with respect to any Plan, a reportable event, as defined in Section 4043 of ERISA, as to which the PBGC has not by regulation waived the requirement of Section 4043(a) of ERISA that it be notified with thirty (30) days of the occurrence of such event, or (ii) the withdrawal of Seller, PNMAC or any ERISA Affiliate thereof from a Plan during a plan year in which it is a substantial employer, as defined in Section 4001(a)(2) of ERISA, or (iii) the failure by Seller, PNMAC or any ERISA Affiliate thereof to meet the minimum funding standard of Section 412 of the Code or Section 302 of ERISA with respect to any Plan, including, without limitation, the failure to make on or before its due date a required installment under Section 412(m) of the Code (or Section 430(j) of the Code

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as amended by the Pension Protection Act) or Section 302(e) of ERISA (or Section 303(j) of ERISA, as amended by the Pension Protection Act), or (iv) the distribution under Section 4041 of ERISA of a notice of intent to terminate any Plan or any action taken by Seller, PNMAC or any ERISA Affiliate thereof to terminate any plan, or (v) the failure to meet requirements of Section 436 of the Code resulting in the loss of qualified status under Section 401(a)(29) of the Code, or (vi) the institution by the PBGC of proceedings under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or (vii) the receipt by Seller, PNMAC or any ERISA Affiliate thereof of a notice from a Multiemployer Plan that action of the type described in the previous clause (vi) has been taken by the PBGC with respect to such Multiemployer Plan, or (viii) any event or circumstance exists which may reasonably be expected to constitute grounds for Seller, PNMAC or any ERISA Affiliate thereof to incur liability under Title IV of ERISA or under Sections 412(b) or 430(k) of the Code with respect to any Plan.

Event of Default” has the meaning assigned to such term in Section 7.01.

Existing Indebtedness” has the meaning specified in Section 3.22.

Expenses” means all present and future expenses reasonably incurred by or on behalf of Buyer in connection with the negotiation, execution or enforcement of this Agreement or any of the other Program Agreements and any amendment, supplement or other modification or waiver related hereto or thereto, whether incurred heretofore or hereafter, which expenses shall include the reasonable and documented cost of title, lien, judgment and other record searches; reasonable and documented attorneys’ fees; any ongoing audits or due diligence costs in connection with valuation, entering into Transactions or determining whether a Margin Deficit may exist; and costs of preparing and recording any UCC financing statements or other filings necessary to perfect the security interest created hereby.

FATCA” Sections 1471 through 1474 of the Code as of the date of this Agreement (or any amended or successor version that is substantially comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or any U.S. or non-U.S. fiscal or regulatory legislation, guidance, notes, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code.

Fidelity Insurance” means insurance coverage with respect to employee errors, omissions, dishonesty, forgery, theft, disappearance and destruction, robbery and safe burglary, property (other than money and securities) and computer fraud in an aggregate amount acceptable to Seller’s regulators.

Financial Statements” means the consolidated financial statements of Seller prepared in accordance with GAAP for the year or other period then ended.

GAAP” means U.S. generally accepted accounting principles that are (i) consistent with the principles promulgated or adopted by the Financial Accounting Standards Board and its successors, as in effect from time to time, and (ii) applied consistently with principles applied to past financial statements of Seller and its subsidiaries; provided,  that a certified public

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accountant would, insofar as the use of such accounting principles is pertinent, be in a position to deliver an unqualified opinion (other than a qualification regarding changes in generally accepted accounting principles) that such principles have been properly applied in preparing such financial statements.

GLB Act” has the meaning set forth in Section 10.11(b).

Governmental Actions” means any and all consents, approvals, permits, orders, authorizations, waivers, exceptions, variances, exemptions or licenses of, or registrations, declarations or filings with, any Governmental Authority required under any Governmental Rules.

Governmental Authority” means any nation or government, any state or other political subdivision thereof, or any entity exercising executive, legislative, judicial, regulatory or administrative functions over Seller or Buyer, as applicable.

Governmental Rules” means any and all laws, statutes, codes, rules, regulations, ordinances, orders, writs, decrees and injunctions, of any Governmental Authority and any and all legally binding conditions, standards, prohibitions, requirements and judgments of any Governmental Authority.

Guarantee” means, as to any Person, any obligation of such Person directly or indirectly guaranteeing any Indebtedness of any other Person or in any manner providing for the payment of any Indebtedness of any other Person or otherwise protecting the holder of such Indebtedness against loss (whether by virtue of partnership arrangements, by agreement to keep‑well, to purchase assets, goods, securities or services, or to take-or-pay or otherwise); provided that the term “Guarantee” shall not include (i) endorsements for collection or deposit in the ordinary course of business, or (ii) obligations to make servicing advances for delinquent taxes and insurance or other obligations in respect of a mortgaged property.  The amount of any Guarantee of a Person shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith.  The terms “Guarantee” and “Guaranteed” used as verbs shall have correlative meanings.

Indebtedness” means, for any Person:  (a) obligations created, issued or incurred by such Person for borrowed money (whether by loan, the issuance and sale of debt securities or the sale of Property to another Person subject to an understanding or agreement, contingent or otherwise, to repurchase such Property from such Person); (b) obligations of such Person to pay the deferred purchase or acquisition price of Property or services, other than trade accounts payable (other than for borrowed money) arising, and accrued expenses incurred, in the ordinary course of business, so long as such trade accounts payable are payable within ninety (90) days of the date the respective goods are delivered or the respective services are rendered; (c) Indebtedness of others secured by a Lien on the Property of such Person, whether or not the respective Indebtedness so secured has been assumed by such Person; (d) obligations (contingent or otherwise) of such Person in respect of letters of credit or similar instruments issued or accepted by banks and other financial institutions for the account of such Person; (e) Capital Lease Obligations of such Person; (f) obligations of such Person under repurchase agreements, sale/buy-back agreements or like

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arrangements, including, without limitation, any Indebtedness arising hereunder; (g) Indebtedness of others Guaranteed by such Person; (h) all obligations of such Person incurred in connection with the acquisition or carrying of fixed assets by such Person; (i) Indebtedness of general partnerships of which such Person is a general partner and (j) with respect to clauses (a)-(i) above both on and off balance sheet.

Indenture” means the Base Indenture, together with the Series 2020-SPIADVF1 Indenture Supplement thereto.

Indenture Trustee” means Citibank, N.A., its permitted successors and assigns.

Issuer” has the meaning given to such term in the recitals to this Agreement.

Laws” means any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of any Governmental Authority.

Lien” means, with respect to any property or asset of any Person (a) any mortgage, lien, pledge, charge or other security interest or encumbrance of any kind in respect of such property or asset or (b) the interest of a vendor or lessor arising out of the acquisition of or agreement to acquire such property or asset under any conditional sale agreement, lease purchase agreement or other title retention agreement.

Margin” has the meaning assigned to the term in the Pricing Side Letter.

Margin Call” has the meaning set forth in Section 2.05(a).

Margin Deadlines” has the meaning set forth in Section 2.05(b).

Margin Deficit” has the meaning set forth in Section 2.05(a).

Market Value” means, with respect to the Note as of any date of determination, and without duplication, the fair market value of the Note on such date as reasonably determined by Buyer (or an Affiliate thereof).

Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the operations, business, properties, condition (financial or otherwise) or prospects of Seller or any Affiliate that is a party to any Program Agreement taken as a whole; (b) a material impairment of the ability of Seller or any Affiliate that is a party to any Program Agreement to perform under any Program Agreement and to avoid any Event of Default;  or (c) a material adverse effect upon the legality, validity, binding effect or enforceability of any Program Agreement against Seller or any Affiliate that is a party to any Program Agreement.

Maximum Purchase Price” has the meaning assigned to the term in the Pricing Side Letter.

MLRA Pricing Side Letter”  has the meaning assigned to the term in the Pricing Side Letter.

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Moody’s” means Moody’s Investors Service, Inc. or any successors thereto.

Mortgage Loan Repurchase Agreement”  has the meaning assigned to the term in the Pricing Side Letter.

Multiemployer Plan” means a multiemployer plan defined as such in Section 3(37) of ERISA to which contributions have been or are required to be made by Seller or any ERISA Affiliate and that is covered by Title IV of ERISA.

Non-Excluded Taxes” has the meaning set forth in Section 2.11(a).

Note” has the meaning given to such term in the recitals to this Agreement.

Notice” or “Notices” means all requests, demands and other communications, in writing (including facsimile transmissions and e-mails), sent by overnight delivery service, facsimile transmission, electronic transmission or hand-delivery to the intended recipient at the address specified in Section 10.05 or, as to any party, at such other address as shall be designated by such party in a written notice to the other party.

Obligations” means (a) all of Seller’s indebtedness, obligations to pay the outstanding principal balance of the Purchase Price, together with interest thereon on the Termination Date, outstanding interest due on each Price Differential Payment Date, and other obligations and liabilities, to Buyer or its Affiliates arising under, or in connection with, the Program Agreements, whether now existing or hereafter arising; (b) any and all sums reasonably incurred and paid by Buyer or on behalf of Buyer in order to preserve any Repurchase Asset or its interest therein; (c) in the event of any proceeding for the collection or enforcement of any of Seller’s indebtedness, obligations or liabilities referred to in this definition, the reasonable expenses of retaking, holding, collecting, preparing for sale, selling or otherwise disposing of or realizing on any Repurchase Asset, or of any exercise by Buyer of its rights under the Program Agreements, including, without limitation, reasonable attorneys’ fees and disbursements and court costs; and (d) all of Seller’s indemnity obligations to Buyer pursuant to the Program Agreements.

OFAC” has the meaning set forth in Section 3.25.

Officer’s Compliance Certificate” has the meaning assigned to such term in the Pricing Side Letter.

Other Repurchase Agreements” means the Mortgage Loan Repurchase Agreement and the Series 2016-MSRVF1 Repurchase Agreement.

Other Taxes” has the meaning set forth in Section 2.11(b).

Participant” has the meaning set forth in Section 9.02(a).

PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

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Pension Protection Act” means the Pension Protection Act of 2006, as amended from time to time.

Person” means an individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

Plan” means an employee benefit or other plan established or maintained by any Seller or any ERISA Affiliate and covered by Title IV of ERISA, other than a Multiemployer Plan.

 “PLS” has the meaning given to such term in the preamble to this Agreement.

PNMAC” means Private National Mortgage Acceptance Company, LLC, its permitted successors and assigns.

Price Differential” means with respect to any Transaction as of any date of determination, an amount equal to the product of (A) the Pricing Rate for such Transaction and (B) the Purchase Price for such Transaction, calculated daily on the basis of a 360 day year for the actual number of days during the Price Differential Period.

Price Differential Payment Date” means, for as long as any Obligations shall remain owing by Seller to Buyer, each Payment Date (as defined in the Indenture).

Price Differential Period” means, the period from and including a Price Differential Payment Date, up to but excluding the next Price Differential Payment Date.

Price Differential Statement Date” has the meaning set forth in Section 2.04.

Pricing Rate” means Base Rate plus the applicable Margin.

Pricing Side Letter” means the letter agreement dated as of the Closing Date, between Buyer and Seller as amended, restated, supplemented or otherwise modified from time to time.

Primary Repurchase Assets” has the meaning set forth in Section 4.02(a).

Proceeds” means “proceeds” as defined in Section 9-102(a)(64) of the UCC.

Program Agreements” means this Agreement, the Pricing Side Letter, the VFN Guaranty, the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement, as each of the same may hereafter be amended, restated, supplemented or otherwise modified from time to time.

Prohibited Person” has the meaning set forth in Section 3.25.

Property” means any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible.

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Purchase Date” means, subject to the satisfaction of the conditions precedent set forth in Article V hereof, each Funding Date (as defined in the Indenture) on which a Transaction is entered into by Buyer pursuant to Section 2.02 or such other mutually agreed upon date as more particularly set forth on Exhibit A hereto.

Purchase Price”  means on any date of determination:

(i)         the price at which each Purchased Asset (or portion thereof) is transferred by Seller to Buyer, which shall equal the Asset Value of such Purchased Asset on the related Purchase Date, minus

(ii)       the sum of (a) any Repurchase Price paid with respect to such Purchased Asset pursuant to Section 2.03, plus (b) any Additional Note Payment made with respect to such Purchased Asset pursuant to Section 4.4(c) or Section 4.5(e) of the Indenture, plus (c) any Redemption Amount paid pursuant to Section 13.1 of the Indenture, plus (d) any amounts paid or applied with respect to such Purchased Asset pursuant to Section 2.05.

Purchase Price Percentage” has the meaning assigned to the term in the Pricing Side Letter.

Purchased Assets” means, collectively, the Note and all outstanding Additional Balances together with the Repurchase Assets related to such Note and Additional Balances transferred by Seller to Buyer in a Transaction hereunder, as listed on the related Asset Schedule attached to the related Transaction Notice.

Records” means all instruments, agreements and other books, records, and reports and data generated by other media for the storage of information maintained by Seller, or any other person or entity with respect to the Purchased Assets.

Register” has the meaning set forth in Section 9.02(b).

Repurchase Assets” has the meaning set forth in Section 4.02(c).

Repurchase Date” means the earlier of (i) the Termination Date or (ii) the date requested by Seller on which the Repurchase Price is paid pursuant to Section 2.03.

Repurchase Documents” means any or all of the “Program Agreements” as defined in each Other Repurchase Agreement.

Repurchase Price” means the price at which Purchased Assets are to be transferred from Buyer to Seller upon termination of a Transaction, which will be determined in each case (including Transactions terminable upon demand) as the sum of the Purchase Price and the accrued but unpaid Price Differential as of the date of such determination.

Repurchase Rights” has the meaning set forth in Section 4.02(c).

Requirement of Law” means, with respect to any Person, any law, treaty, rule or regulation or determination of an arbitrator, a court or other Governmental Authority, applicable

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to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

Responsible Officer” means as to any Person, the chief executive officer or, with respect to financial matters, the chief financial officer or treasurer of such Person.  The Responsible Officers of Seller as of the Closing Date are listed on Schedule 1 hereto.

S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business, or any successor thereto.

SEC” means the Securities and Exchange Commission, or any successor thereto.

Seller” has the meaning assigned to such term in the preamble to this Agreement and includes PLS’ permitted successors and assigns.

Seller Termination Option” means (a) (i) Buyer has or shall incur costs in connection with those matters provided for in Section 2.10 or 2.11 and (ii) Buyer requests that Seller pay to Buyer those costs in connection therewith or (b) Buyer has declared in writing that an event described in Section 5.02(h)(A) has occurred.

Series 2016-MSRVF1 Repurchase Agreement”  means the Master Repurchase Agreement, dated as of December 19, 2016, as amended by Amendment No. 1, dated as of February 28, 2018 and Amendment No. 2, dated as of April 1, 2020, among PLS, as repo seller, CSCIB, as repo buyer and CSFB, as administrative agent, as amended, restated, supplemented or otherwise modified from time to time.

Series 2020-SPIADVF1 Indenture Supplement” means the Series 2020-SPIADVF1 Indenture Supplement, dated as of April 1, 2020, among the Issuer, Citibank, N.A., as indenture trustee, as calculation agent, as paying agent and as securities intermediary, PLS, as administrator and as servicer, and CSFB, as administrative agent, as amended, restated, supplemented or otherwise modified from time to time.

SPIADVF1 Funding Conditions” with respect to the Series 2020-SPIADVF1 Notes and any Funding Date, the following conditions:

(i)  the Advance Verification Agent Report immediately preceding such Funding Date has been delivered in accordance with Section 3.3(g)(2) of the Base Indenture; and

(ii)  to the extent the Advance Verification Agent Report delivered immediately preceding such Funding Date contains any exceptions noted therein, such exceptions have been waived by the Administrative Agent in its sole discretion.

Subordinated Pledge Assets” has the meaning set forth in Section 4.02(c).

Subsidiary” means, with respect to any Person, any corporation, partnership or other entity of which at least a majority of the securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such corporation, partnership or other entity (irrespective of

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whether or not at the time securities or other ownership interests of any other class or classes of such corporation, partnership or other entity shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned or controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person.

Taxes” has the meaning assigned to such term in Section 2.11(a).

Termination Date” has the meaning assigned to such term in the Pricing Side Letter.

Transaction” has the meaning assigned to such term in the recitals to this Agreement.

Transaction Notice” has the meaning assigned to such term in Section 2.02(a).

Transaction Register” has the meaning assigned to such term in Section 9.03(b).

Transferee” has the meaning set forth in Section 9.02(b).

Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as in effect on the Closing Date in the State of New York or the Uniform Commercial Code as in effect in the applicable jurisdiction.

VFN Guarantor” means Private National Mortgage Acceptance Company, LLC, in its capacity as guarantor under the VFN Guaranty.

VFN Guaranty” means the Amended and Restated Guaranty, dated as of the Closing Date, as further amended, restated, supplemented or otherwise modified from time to time, pursuant to which VFN Guarantor fully and unconditionally guarantees the obligations of Seller hereunder.

Weekly Report Date” has the meaning set forth in Section 6.03.

Section 1.02       Other Defined Terms.

(a)        Any capitalized terms used and not defined herein shall have the meaning set forth in the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement, as applicable.

(b)        The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  Unless otherwise specified herein, the term “or” has the inclusive meaning represented by the term “and/or” and the term “including” is not limiting.  All references to Sections, subsections, Articles and Exhibits shall be to Sections, subsections, and Articles of, and Exhibits to, this Agreement unless otherwise specifically provided.

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(c)        In the computation of periods of time from a specified date to a later specified date, unless otherwise specified herein the words “commencing on” mean “commencing on and including,” the word “from” means “from and including” and the words “to” and “until” each means “to but excluding.”

ARTICLE II

 

GENERAL TERMS

Section 2.01       Transactions.  Subject to the terms and conditions hereof, Buyer agrees to enter into Transactions with Seller for a Purchase Price outstanding at any one time not to exceed the Maximum Purchase Price.  During the Commitment Period, Seller may utilize the Commitment by requesting Transactions, Seller may pay the Repurchase Price in whole or in part at any time during such period without penalty, and additional Transactions may be entered into in accordance with the terms and conditions hereof.  Buyer’s obligation to enter into Transactions pursuant to the terms of this Agreement shall terminate on the Termination Date.  Notwithstanding the foregoing, Buyer shall have no commitment or obligation to enter into Transactions in connection with the Note to the extent the Purchase Price of such Transaction exceeds the Maximum Purchase Price.

Section 2.02       Procedure for Entering into Transactions.

(a)        Seller may enter into Transactions with Buyer under this Agreement during the Commitment Period on any Purchase Date; provided, that Seller shall have given Buyer irrevocable notice (each, a “Transaction Notice”), which notice (i) shall be substantially in the form of Exhibit A, (ii) shall be signed by a Responsible Officer of Seller and be received by Buyer prior to 1:00 p.m. (New York time) one (1) Business Day prior to the related Purchase Date, and (iii) shall specify: (A) (i) the Maximum VFN Principal Balance of the Note, (ii) with respect to the first Purchase Date, the Initial Note Balance of the Note, and, with respect to any other Purchase Date, the Additional Balance and (iii) after taking into account the Additional Balance being requested on such Purchase Date, the outstanding VFN Principal Balance of the Note; (B) the Dollar amount of the requested Purchase Price; (C) the requested Purchase Date; and (D) any additional terms or conditions of the Transaction not inconsistent with this Agreement.  Each Transaction Notice on any Purchase Date shall be in an amount equal to at least $500,000.

(b)        If Seller shall deliver to Buyer a Transaction Notice that satisfies the requirements of Section 2.02(a), Buyer will notify Seller of its intent to remit the requested Purchase Price one (1) Business Day prior to the requested Purchase Date.  If all applicable conditions precedent set forth in Article V have been satisfied on or prior to the Purchase Date, then subject to the foregoing, on the Purchase Date, Buyer shall remit the amount of the requested Purchase Price in U.S. Dollars and in immediately available funds to the Buyer Account.

(c)        Upon entering into each Transaction hereunder, the Asset Schedule shall be automatically updated and replaced with the Asset Schedule attached to the related Transaction Notice.

Section 2.03       Repurchase; Payment of Repurchase Price.

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(a)        Seller hereby promises to repurchase the Purchased Assets and pay all outstanding Obligations on the Termination Date.

(b)        By notifying Buyer in writing at least one (1) Business Day in advance, Seller shall be permitted, at its option, to prepay, subject to Section 2.12, the Purchase Price in whole or in part at any time, together with accrued and unpaid interest on the amount so prepaid.

Section 2.04      Price Differential.  On each Price Differential Payment Date, Seller hereby promises to pay to Buyer all accrued and unpaid Price Differential on the Transactions, as invoiced by Buyer to Seller three (3) Business Days prior to the related Price Differential Payment Date (the “Price Differential Statement Date”); provided, that if Buyer fails to deliver such statement on the Price Differential Statement Date, on such Price Differential Payment Date Seller shall pay the amount which Seller calculates as the Price Differential due and upon delivery of the statement, Seller shall remit to Buyer any shortfall, or Buyer shall refund to Seller any excess, in the Price Differential paid.  Price Differential shall accrue each day on the Purchase Price at a rate per annum equal to the Pricing Rate.  The Price Differential shall be computed on the basis of the actual number of days in each Price Differential Period and a 360‑day year.

Section 2.05       Margin Maintenance.

(a)        If at any time the aggregate outstanding amount of the Purchase Price of the Note is greater than the related Asset Value (such excess, a “Margin Deficit”), then Buyer may by notice to Seller require Seller to transfer to Buyer cash in an amount at least equal to the Margin Deficit (such requirement, a “Margin Call”).

(b)        Notice delivered pursuant to Section 2.05(a) may be given by any written or electronic means.  With respect to a Margin Call, any notice given before 5:00 p.m. (New York City time) on a Business Day shall be met, and the related Margin Call satisfied, no later than 5:00 p.m. (New York City time) on the following Business Day.  With respect to a Margin Call, any notice given after 5:00 p.m. (New York City time) on a Business Day shall be met, and the related Margin Call satisfied, no later than 5:00 p.m. (New York City time) on the second (2nd) Business Day following the date of such notice.  The foregoing time requirements for satisfaction of a Margin Call are referred to as the “Margin Deadlines”.  The failure of Buyer, on any one or more occasions, to exercise its rights hereunder, shall not change or alter the terms and conditions to which this Agreement is subject or limit the right of Buyer to do so at a later date.  Seller and Buyer each agree that a failure or delay by Buyer to exercise its rights hereunder shall not limit or waive Buyer’s rights under this Agreement or otherwise existing by law or in any way create additional rights for Seller.

(c)        In the event that a Margin Deficit exists, Buyer may retain any funds received by it to which Seller would otherwise be entitled hereunder, which funds (i) may be held by Buyer against the related Margin Deficit or (ii) may be applied by Buyer against the Purchase Price.  Notwithstanding the foregoing, Buyer retains the right, in its sole discretion, to make a Margin Call in accordance with the provisions of this Section 2.05.

Section 2.06      Payment Procedure.  Seller absolutely, unconditionally, and irrevocably, shall make, or cause to be made, all payments required to be made by Seller hereunder.

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Seller shall deposit or cause to be deposited all amounts constituting collection, payments and proceeds of the Note (including, without limitation, all fees and proceeds of sale) to the Buyer Account.

Section 2.07       Application of Payments.

(a)        On each Price Differential Payment Date, all amounts deposited into the Buyer Account from and after the immediately preceding Price Differential Payment Date (or the Closing Date in connection with the initial Price Differential Payment Date) shall be applied as follows:

(i)         first, to the payment of any accrued and unpaid Price Differential owing;

(ii)        second, to the payment of Purchase Price outstanding to satisfy any Margin Deficit owing;

(iii)       third, to payment of all other costs and fees payable to Buyer pursuant to this Agreement; and

(iv)       fourth, any remainder to Seller.

(b)        Notwithstanding the preceding provisions, if an Event of Default shall have occurred hereunder, all funds related to the Note shall be applied as follows:

(i)         first, to the payment of any accrued and unpaid Price Differential owing;

(ii)        second, to the payment of Purchase Price until reduced to zero;

(iii)       third, to payment of all other costs and fees payable to Buyer pursuant to this Agreement;

(iv)       fourth, to the payment of any other Obligations; and

(v)        fifth, any remainder to Seller.

Section 2.08       Use of Purchase Price and Transaction Requests.  The Purchase Price shall be used by Seller for general corporate purposes.

Section 2.09      Recourse.  Notwithstanding anything else to the contrary contained or implied herein or in any other Program Agreement, Buyer shall have full, unlimited recourse against Seller and its assets in order to satisfy the Obligations.

Section 2.10       Requirements of Law.

(a)        If any Requirement of Law (other than with respect to any amendment made to Buyer’s certificate of trust and trust agreement or other organizational or governing documents)

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or any change in the interpretation or application thereof or compliance by Buyer with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the Closing Date:

(i)         shall subject Buyer to any tax of any kind whatsoever with respect to this Agreement or the Transactions (excluding income taxes, branch profits taxes, franchise taxes or similar taxes imposed on Buyer as a result of any present or former connection between Buyer and the United States, other than any such connection arising solely from Buyer having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement) or change the basis of taxation of payments to Buyer in respect thereof;

(ii)        shall impose, modify or hold any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, or other extensions of credit by, or any other acquisition of funds by, any office of Buyer which is not otherwise included in the determination of the Price Differential hereunder; or

(iii)      shall impose on Buyer any other condition;

and the result of any of the foregoing is to increase the cost to Buyer, by an amount which Buyer deems to be material, of entering, continuing or maintaining this Agreement or any other Program Agreement, the Transactions or to reduce any amount due or owing hereunder in respect thereof, then, in any such case, Seller shall promptly pay Buyer such additional amount or amounts as calculated by Buyer in good faith as will compensate Buyer for such increased cost or reduced amount receivable.

(b)        If Buyer shall have determined that the adoption of or any change in any Requirement of Law (other than with respect to any amendment made to Buyer’s certificate of incorporation and by-laws or other organizational or governing documents) regarding capital adequacy or in the interpretation or application thereof or compliance by Buyer or any corporation Controlling Buyer with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the Closing Date shall have the effect of reducing the rate of return on Buyer’s or such corporation’s capital as a consequence of its obligations hereunder to a level below that which Buyer or such corporation could have achieved but for such adoption, change or compliance (taking into consideration Buyer’s or such corporation’s policies with respect to capital adequacy) by an amount deemed by Buyer to be material, then from time to time, Seller shall promptly pay to Buyer such additional amount or amounts as will compensate Buyer for such reduction.

(c)        If Buyer becomes entitled to claim any additional amounts pursuant to this Section 2.10, it shall promptly notify Seller of the event by reason of which it has become so entitled.  A certificate as to any additional amounts payable pursuant to this Section 2.10 submitted by Buyer to Seller shall be conclusive in the absence of manifest error.

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Section 2.11       Taxes.

(a)        Any and all payments by or on behalf of Seller under or in respect of this Agreement or any other Program Agreements to which Seller is a party shall be made free and clear of, and without deduction or withholding for or on account of, any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities (including penalties, interest and additions to tax) with respect thereto, whether now or hereafter imposed, levied, collected, withheld or assessed by any taxation authority or other Governmental Authority (collectively, “Taxes”), unless required by law.  If Seller shall be required under any applicable Requirement of Law to deduct or withhold any Taxes from or in respect of any sum payable under or in respect of this Agreement or any of the other Program Agreements to Buyer (including for purposes of Section 2.10 and this Section 2.11, any assignee, successor or participant), (i) Seller shall make all such deductions and withholdings in respect of Taxes, (ii) Seller shall pay the full amount deducted or withheld in respect of Taxes to the relevant taxation authority or other Governmental Authority in accordance with any applicable Requirement of Law, and (iii) the sum payable by Seller shall be increased as may be necessary so that after Seller has made all required deductions and withholdings (including deductions and withholdings applicable to additional amounts payable under this Section 2.11) such Buyer receives an amount equal to the sum it would have received had no such deductions or withholdings been made in respect of Non-Excluded Taxes.  For purposes of this Agreement the term “Non-Excluded Taxes” are Taxes other than, in the case of Buyer, Taxes that are (i) imposed on its overall net income (and franchise taxes imposed in lieu thereof) by the jurisdiction under the laws of which such Buyer is organized or of its Applicable Lending Office, or any political subdivision thereof, unless such Taxes are imposed as a result of Buyer having executed, delivered or performed its obligations or received payments under, or enforced, this Agreement or any of the other Program Agreements (in which case such Taxes will be treated as Non-Excluded Taxes) and (ii) imposed pursuant to FATCA.

(b)        In addition, Seller hereby agrees to pay any present or future stamp, recording, documentary, excise, property or value-added taxes, or similar taxes, charges or levies that arise from any payment made under or in respect of this Agreement or any other Program Agreement or from the execution, delivery or registration of, any performance under, or otherwise with respect to, this Agreement or any other Program Agreement (collectively, “Other Taxes”).

(c)        Seller hereby agrees to indemnify Buyer for, and to hold it harmless against, the full amount of Non-Excluded Taxes and Other Taxes, and the full amount of Taxes of any kind imposed by any jurisdiction on amounts payable by Seller under this Section 2.11 imposed on or paid by such Buyer and any liability (including penalties, additions to tax, interest and expenses) arising therefrom or with respect thereto.  The indemnity by Seller provided for in this Section 2.11 shall apply and be made whether or not the Non-Excluded Taxes or Other Taxes for which indemnification hereunder is sought have been correctly or legally asserted.  Amounts payable by Seller under the indemnity set forth in this Section 2.11(c) shall be paid within ten (10) days from the date on which Buyer makes written demand therefor.

(d)        Without prejudice to the survival of any other agreement of the Seller hereunder, the agreements and obligations of the Seller contained in this Section 2.11 shall survive the termination of this Agreement and the other Program Agreements.  Nothing contained in

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Section 2.10 or this Section 2.11 shall require any Buyer to make available any of its tax returns or any other information that it deems to be confidential or proprietary.

(e)        Buyer will timely furnish Seller, or any agent of Seller, any tax forms or certifications (such as an applicable IRS Form W-8, IRS Form W-9 or any successors to such IRS forms) that it is legally entitled to provide and that Seller or its agents may reasonably request (A) to permit Seller or its agents to make payments to it without, or at a reduced rate of, deduction or withholding, (B) to enable Seller or its agents to qualify for a reduced rate of withholding or deduction in any jurisdiction from or through which Seller or its agents receive payments and (C) to enable Seller or its agents to satisfy reporting and other obligations under the Code and Treasury Regulations and under any other applicable laws, and shall update or replace such tax forms or certifications as appropriate or in accordance with their terms or subsequent amendments, and acknowledges that the failure to provide, update or replace any such tax forms or certifications may result in the imposition of withholding or back-up withholding upon payments to Buyer.

Section 2.12       Indemnity.  Without limiting, and in addition to, the provisions of Section 10.02, the Seller agrees to indemnify the Buyer and to hold the Buyer harmless from any loss or expense that the Buyer may sustain or incur as a consequence of (i) a default by the Seller in payment when due of the Repurchase Price or Price Differential or (ii) a default by the Seller in making any prepayment of Repurchase Price after the Seller has given a notice thereof in accordance with Section 2.03.

Section 2.13      Additional Balance.  In the event that Seller wishes an increase in the VFN Principal Balance, Seller shall deliver to Buyer a copy of the VFN Note Balance Adjustment Request that is delivered under the Indenture.  If all the Funding Conditions required pursuant to Section 5.02 hereof and the Indenture have been satisfied, then upon approval in writing by Buyer of such increase in the VFN Principal Balance (such increase, upon such approval, an “Additional Balance”), the outstanding VFN Principal Balance set forth in the Asset Schedule hereof shall be automatically updated as set forth in the related Transaction Notice in accordance with Section 2.02.

Section 2.14       Commitment Fee.  Seller shall pay the Commitment Fee as specified in the Pricing Side Letter.  Such payment shall be made in Dollars, in immediately available funds, without deduction, set off or counterclaim, to Buyer at such account designated in writing by Buyer.

Section 2.15       Termination.

(a)        Notwithstanding anything to the contrary set forth herein, if a Seller Termination Option occurs, Seller may, upon five (5) Business Days’ prior written notice of such event, terminate this Agreement and the Termination Date shall be deemed to have occurred (upon the expiration of such five (5) Business Day period).

(b)        In the event that a Seller Termination Option as described in clause (a) of the definition thereof has occurred and Seller has notified Buyer in writing of its option to terminate this Agreement, Buyer shall have the right to withdraw such request for payment within three (3)

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Business Days of Seller’s notice of its exercise of the Seller Termination Option and Seller shall no longer have the right to terminate this Agreement.

(c)        In connection with Seller’s exercise of a Seller Termination Option, Buyer shall refund to Seller an amount equal to the Commitment Fee prorated for the number of days remaining from and including the deemed Termination Date to but excluding the then scheduled Termination Date.

(d)        For the avoidance of doubt, Seller shall remain responsible for all costs actually incurred by Buyer pursuant to Sections 2.10 and 2.11.

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES

Seller represents and warrants to Buyer as of the Closing Date and as of each Purchase Date for any Transaction that:

Section 3.01       Seller Existence.  Seller has been duly organized and is validly existing as a limited liability company in good standing under the laws of the State of Delaware.

Section 3.02       Licenses.  Seller is duly licensed or is otherwise qualified in each jurisdiction in which it transacts business for the business which it conducts and is not in default of any applicable federal, state or local laws, rules and regulations unless, in either instance, the failure to take such action is not reasonably likely (either individually or in the aggregate) to cause a Material Adverse Effect and is not in default of such state’s applicable laws, rules and regulations.  Seller has the requisite power and authority and legal right to own, sell and grant a lien on all of its right, title and interest in and to the Note.  Seller has the requisite power and authority and legal right to execute and deliver, engage in the transactions contemplated by, and perform and observe the terms and conditions of, this Agreement, each Program Agreement and any Transaction Notice.

Section 3.03       Power.  Seller has all requisite corporate or other power, and has all governmental licenses, authorizations, consents and approvals necessary to own its assets and carry on its business as now being or as proposed to be conducted, except where the lack of such licenses, authorizations, consents and approvals would not be reasonably likely to have a Material Adverse Effect.

Section 3.04       Due Authorization.  Seller has all necessary corporate or other power, authority and legal right to execute, deliver and perform its obligations under each of the Program Agreements, as applicable.  This Agreement, any Transaction Notice and the Program Agreements have been (or, in the case of Program Agreements and any Transaction Notice not yet executed, will be) duly authorized, executed and delivered by Seller, all requisite or other corporate action having been taken, and each is valid, binding and enforceable against Seller in accordance with its terms except as such enforcement may be affected by bankruptcy, by other insolvency laws, or by general principles of equity.

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Section 3.05       Financial Statements.  (A) Seller has heretofore furnished to Buyer a copy of its balance sheet for the fiscal year of Seller ended December 31, 2019 and the related statements of income for Seller for such fiscal year, with the opinion thereon of Deloitte & Touche LLP.  All such financial statements are accurate, complete and correct and fairly present, in all material respects, the financial condition of Seller (subject to normal year-end adjustments) and the results of its operations as at such dates and for such fiscal periods, all in accordance with GAAP applied on a consistent basis, and to the best of the Seller’s knowledge, do not omit any material fact as of the date(s) thereof.  Since December 31, 2019, there has been no material adverse change in the consolidated business, operations or financial condition of Seller from that set forth in said financial statements nor is Seller aware of any state of facts which (with notice or the lapse of time) would or could result in any such material adverse change.  Seller has no liabilities, direct or indirect, fixed or contingent, matured or unmatured, known or unknown, or liabilities for taxes, long-term leases or unusual forward or long-term commitments not disclosed by, or reserved against in, said balance sheet and related statements, and at the present time there are no material unrealized or anticipated losses from any loans, advances or other commitments of Seller except as heretofore disclosed to Buyer in writing.

(B)       Seller has heretofore caused VFN Guarantor to furnish to Buyer a copy of its balance sheet for the fiscal year of VFN Guarantor ended December 31, 2019 and the related statements of income for VFN Guarantor for such fiscal year, with the opinion thereon of Deloitte & Touche LLP.  All such financial statements are accurate, complete and correct and fairly present, in all material respects, the financial condition of VFN Guarantor (subject to normal year-end adjustments) and the results of its operations as at such dates and for such fiscal periods, all in accordance with GAAP applied on a consistent basis, and to the best of the Seller’s knowledge, do not omit any material fact as of the date(s) thereof.  Since December 31, 2019, there has been no material adverse change in the consolidated business, operations or financial condition of VFN Guarantor from that set forth in said financial statements nor is Seller aware of any state of facts which (with notice or the lapse of time) would or could result in any such material adverse change.  VFN Guarantor has no liabilities, direct or indirect, fixed or contingent, matured or unmatured, known or unknown, or liabilities for taxes, long-term leases or unusual forward or long-term commitments not disclosed by, or reserved against in, said balance sheet and related statements, and at the present time there are no material unrealized or anticipated losses from any loans, advances or other commitments of VFN Guarantor except as heretofore disclosed to Buyer in writing.

Section 3.06       No Event of Default.  There exists no Event of Default under Section 7.01 hereof, which default gives rise to a right to accelerate indebtedness as referenced in Section 7.03 hereof, under any mortgage, borrowing agreement or other instrument or agreement pertaining to indebtedness for borrowed money or to the repurchase of mortgage loans or securities.

Section 3.07       Solvency.  Seller is solvent and will not be rendered insolvent by any Transaction and, after giving effect to such Transaction, will not be left with an unreasonably small amount of capital with which to engage in its business.  Seller does not intend to incur, nor believes that it has incurred, debts beyond its ability to pay such debts as they mature and is not contemplating the commencement of insolvency, bankruptcy, liquidation or consolidation proceedings or the appointment of a receiver, liquidator, conservator, trustee or similar official in

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respect of such entity or any of its assets.  Seller is not selling and/or pledging any Repurchase Assets with any intent to hinder, delay or defraud any of its creditors.

Section 3.08      No Conflicts.  The execution, delivery and performance by of Seller of this Agreement, any Transaction Notice hereunder and the Program Agreements do not conflict with any term or provision of the organizational documents of Seller or any law, rule, regulation, order, judgment, writ, injunction or decree applicable to Seller of any court, regulatory body, administrative agency or governmental body having jurisdiction over Seller, which conflict would have a Material Adverse Effect and will not result in any violation of any such mortgage, instrument, agreement or obligation to which Seller is a party.

Section 3.09      True and Complete Disclosure.  All information, reports, exhibits, schedules, financial statements or certificates of Seller or any Affiliate thereof or any of their officers furnished or to be furnished to Buyer in connection with the initial or any ongoing due diligence of Seller or any Affiliate or officer thereof, negotiation, preparation, or delivery of the Program Agreements are true and complete in all material respects and do not omit to disclose any material facts necessary to make the statements herein or therein, in light of the circumstances in which they are made, not misleading.  All financial statements have been prepared in accordance with GAAP.

Section 3.10       Approvals.  No consent, approval, authorization or order of, registration or filing with, or notice to any governmental authority or court is required under applicable law in connection with the execution, delivery and performance by Seller of this Agreement, any Transaction Notice and the Program Agreements.

Section 3.11       Litigation.  There is no action, proceeding or investigation pending with respect to which Seller has received service of process or, to the best of Seller’s knowledge threatened against it before any court, administrative agency or other tribunal (A) asserting the invalidity of this Agreement, any Transaction, Transaction Notice or any Program Agreement, (B) seeking to prevent the consummation of any of the transactions contemplated by this Agreement, any Transaction Notice or any Program Agreement, (C) makes a claim individually or in the aggregate in an amount greater than $10,000,000, (D) which requires filing with the SEC in accordance with the 1934 Act or any rules thereunder, (E) which has resulted in the voluntary or involuntary suspension of a license, a cease and desist order, or such other action as could adversely impact Seller’s business, or (F) which might materially and adversely affect the validity of the Purchased Assets or the performance by it of its obligations under, or the validity or enforceability of, this Agreement, any Transaction Notice or any Program Agreement.

Section 3.12      Material Adverse Change.  There has been no material adverse change in the business, operations, financial condition, properties or prospects of Seller  or its Affiliates since the date set forth in the most recent financial statements supplied to Buyer that is reasonably likely to have a Material Adverse Effect on Seller.

Section 3.13       Ownership.

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(a)        Seller has good title to all of the Repurchase Assets, free and clear of all mortgages, security interests, restrictions, Liens and encumbrances of any kind other than the Liens created hereby or contemplated herein.

(b)        Each item of the Repurchase Assets was acquired by Seller in the ordinary course of its business, in good faith, for value and without notice of any defense against or claim to it on the part of any Person.

(c)        There are no agreements or understandings between Seller and any other party which would modify, release, terminate or delay the attachment of the security interests granted to Buyer under this Agreement.

(d)        The provisions of this Agreement are effective to create in favor of Buyer a valid security interest in all right, title and interest of Seller in, to and under the Repurchase Assets.

(e)        Upon the filing of financing statements on Form UCC-1 naming Buyer as “Secured Party” and Seller as “Debtor”, and describing the Repurchase Assets, in the recording offices of the Secretary of State of Delaware the security interests granted hereunder in the Repurchase Assets will constitute fully perfected first priority security interests under the Uniform Commercial Code in all right, title and interest of Seller in, to and under such Repurchase Assets which can be perfected by filing under the Uniform Commercial Code.

Section 3.14       The Note.  Seller has (i) delivered the Note, (ii) duly endorsed the Note to Buyer or Buyer’s designee, (iii) notified the Indenture Trustee of such transfer and (iv) completed all documents required to effect such transfer in the Note Register, including, without limitation, receipt by the Note Registrar of the Rule 144A Note Transfer Certificate and such other information and documents that may be required pursuant to the terms of the Indenture.  In addition, Buyer has received all other Program Agreements (including, without limitation, all exhibits and schedules referred to therein or delivered pursuant thereto), all amendments thereto, waivers relating thereto and other side letters or agreements affecting the terms thereof and all agreements and other material documents relating thereto, and Seller hereby certifies that the copies delivered to Buyer by Seller are true and complete.  None of such documents has been amended, supplemented or otherwise modified (including waivers) since the respective dates thereof, except by amendments, copies of which have been delivered to Buyer.  Each such document to which Seller is a party has been duly executed and delivered by Seller and is in full force and effect, and no default or material breach has occurred and is continuing thereunder.

Section 3.15       Taxes.  Seller and its Subsidiaries have timely filed all tax returns that are required to be filed by them and have paid all taxes, except for any such taxes as are being appropriately contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves have been provided.  The charges, accruals and reserves on the books of Seller and its Subsidiaries in respect of taxes and other governmental charges are, in the opinion of Seller, adequate.

Section 3.16       Investment Company.  Neither Seller nor any of its Subsidiaries is an “investment company”, or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended; provided, however, that any entity

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that is under the management of PNMAC Capital Management LLC in its capacity as an “investment adviser” within the meaning of the Investment Advisers Act of 1940 and is otherwise not directly or indirectly owned or controlled by Seller shall not be deemed a “Subsidiary” for the purposes of this Section 3.16.

Section 3.17      Chief Executive Office; Jurisdiction of Organization.  On the Closing Date, Seller’s chief executive office, is, and has been, located at 3043 Townsgate Road, Westlake Village, CA 91361.  On the Effective Date, Seller’s jurisdiction of organization is the State of Delaware.  Seller shall provide Buyer with thirty (30) days advance notice of any change in Seller’s principal office or place of business or jurisdiction.  Seller has no trade name.  During the preceding five (5) years, Seller has not been known by or done business under any other name, corporate or fictitious, and has not filed or had filed against it any bankruptcy receivership or similar petitions nor has it made any assignments for the benefit of creditors.

Section 3.18       Location of Books and Records.  The location where Seller keeps its books and records, including all computer tapes and records relating to the Repurchase Assets is its chief executive office.

Section 3.19       ERISA.  Each Plan to which Seller or its Subsidiaries make direct contributions, and, to the knowledge of Seller, each other Plan and each Multiemployer Plan, is in compliance in all material respects with, and has been administered in all material respects in compliance with, the applicable provisions of ERISA, the Code and any other Federal or State law.

Section 3.20      Financing of Note and Additional Balances.  Each Transaction will be used to purchase the Note and one or more Additional Balances relating thereto, which Note will be conveyed and/or sold by Seller to Buyer.

Section 3.21      Agreements.  Neither Seller nor any Subsidiary of Seller is a party to any agreement, instrument, or indenture or subject to any restriction materially and adversely affecting its business, operations, assets or financial condition, except as disclosed in the financial statements described in Section 3.05 hereof.  Neither Seller nor any Subsidiary of Seller is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement, instrument, or indenture which default could have a material adverse effect on the business, operations, properties, or financial condition of Seller as a whole.  No holder of any indebtedness of Seller or of any of its Subsidiaries has given notice of any asserted default thereunder.

Section 3.22       Other Indebtedness.  All Indebtedness (other than Indebtedness evidenced by this Agreement) of Seller existing on the Closing Date is listed on Exhibit B hereto (the “Existing Indebtedness”).

Section 3.23      No Reliance.  Seller has made its own independent decisions to enter into the Program Agreements and each Transaction and as to whether such Transaction is appropriate and proper for it based upon its own judgment and upon advice from such advisors (including without limitation, legal counsel and accountants) as it has deemed necessary.  Seller is not relying upon any advice from Buyer as to any aspect of the Transactions, including without limitation, the legal, accounting or tax treatment of such Transactions.

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Section 3.24      Plan Assets.  Seller is not an employee benefit plan as defined in Section 3 of Title I of ERISA, or a plan described in Section 4975(e)(1) of the Code, and the Purchased Assets are not “plan assets” within the meaning of 29 CFR § 2510.3 101 as amended by Section 3(42) of ERISA, in Seller’s hands, and transactions by or with Seller are not subject to any state or local statute regulating investments or fiduciary obligations with respect to governmental plans within the meaning of Section 3(32) of ERISA.

Section 3.25       No Prohibited Persons.  Neither Seller nor any of its Affiliates, officers, directors, partners or members, is an entity or person (or to the Seller’s knowledge, owned or controlled by an entity or person):  (i) that is listed in the Annex to, or is otherwise subject to the provisions of Executive Order 13224 issued on September 24, 2001 (“EO13224”); (ii) whose name appears on the United States Treasury Department’s Office of Foreign Assets Control (“OFAC”) most current list of “Specifically Designated National and Blocked Persons” (which list may be published from time to time in various mediums including, but not limited to, the OFAC website, http:www.treas.gov/ofac/t11sdn.pdf); (iii) who commits, threatens to commit or supports “terrorism”, as that term is defined in EO13224; or (iv) who is otherwise affiliated with any entity or person listed above (any and all parties or persons described in clauses (i) through (iv) above are herein referred to as a “Prohibited Person”).

Section 3.26       Compliance with 1933 Act.  Neither Seller nor anyone acting on its behalf has offered, transferred, pledged, sold or otherwise disposed of the Note, any interest in the Note or any other similar security to, or solicited any offer to buy or accept a transfer, pledge or other disposition of the Note, any interest in the Note or any other similar security from, or otherwise approached or negotiated with respect to the Note, any interest in the Note or any other similar security with, any person in any manner, or made any general solicitation by means of general advertising or in any other manner, or taken any other action which would constitute a distribution of the Note under the 1933 Act or which would render the disposition of the Note a violation of Section 5 of the 1933 Act or require registration pursuant thereto.

ARTICLE IV

 

CONVEYANCE; REPURCHASE ASSETS; SECURITY INTEREST

Section 4.01       Ownership.  Upon payment of the Purchase Price, Buyer shall become the sole owner of the Purchased Assets, free and clear of all liens and encumbrances.

Section 4.02       Security Interest.

(a)        Although the parties intend (other than for U.S. federal tax purposes) that all Transactions hereunder be sales and purchases and not loans, in the event any such Transactions are deemed to be loans, and in any event, Seller hereby pledges to Buyer as security for the performance by Seller of its Obligations and hereby grants, assigns and pledges to Buyer a fully perfected first priority security interest in all of Seller’s right, title and interest in, to and under each of the following items of property, whether now owned or hereafter acquired, now existing or hereafter created and wherever located, is hereinafter referred to as the “Primary Repurchase Assets”:

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(i)        the Note identified on the Asset Schedule;

(ii)       all rights to reimbursement or payment of the Note and/or amounts due in respect thereof under the Note identified on the Asset Schedule;

(iii)      all records, instruments or other documentation evidencing any of the foregoing;

(iv)      all “general intangibles”, “accounts”, “chattel paper”, “securities accounts”, “investment property”, “deposit accounts” and “money” as defined in the Uniform Commercial Code relating to or constituting any and all of the foregoing (including, without limitation, all of Seller’s rights, title and interest in and under the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement); and

(v)       any and all replacements, substitutions, distributions on or proceeds of any and all of the foregoing.

(b)        [Reserved].

(c)        Buyer and Seller hereby agree that in order to further secure Seller’s Obligations hereunder, Seller hereby assigns, pledges, conveys and grants to Buyer a security interest in (i) as of the Closing Date, Seller’s rights (but not its obligations) under the Program Agreements including without limitation any rights to receive payments thereunder or any rights to collateral thereunder whether now owned or hereafter acquired, now existing or hereafter created (collectively, the “Repurchase Rights”) and (ii) all collateral however defined or described under the Program Agreements to the extent not otherwise included under the definitions of Primary Repurchase Assets or Repurchase Rights (such collateral, “Additional Repurchase Assets,” and collectively with the Primary Repurchase Assets and the Repurchase Rights, the “Repurchase Assets”) to secure the Obligations.

(d)        Seller hereby delivers an irrevocable instruction to the buyer under any Repurchase Document that upon receipt of notice of an Event of Default under this Agreement, the buyer thereunder is authorized and instructed to (i) remit to Buyer hereunder directly any amounts otherwise payable to Seller and (ii) deliver to Buyer all collateral otherwise deliverable to Seller, to the extent all obligations then due and owing under such Other Repurchase Agreement have been paid in full.  In furtherance of the foregoing, upon repayment of the outstanding purchase price under any Other Repurchase Agreement and termination of all obligations of the Seller thereunder or other termination of the related Repurchase Documents following repayment of all obligations thereunder, the related buyer under any Repurchase Document is hereby instructed to deliver to Buyer hereunder any collateral (as such term may be defined under the related Repurchase Documents) then in its possession or control.

(e)        Seller makes a subordinate pledge to the buyers under the Other Repurchase Agreements as security for the performance by Seller of its obligations thereunder and hereby grants, assigns and pledges to the buyers thereunder a subordinate security interest in all of Seller’s right, title and interest in, to and under (i) the Note identified on the Asset Schedule; (ii) all rights to reimbursement or payment of the Note and/or amounts due in respect thereof under the Note

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identified on the Asset Schedule; (iii) all records, instruments or other documentation evidencing any of the foregoing and (iv) any and all replacements, substitutions, distributions on or proceeds of any and all of the foregoing (collectively, the “Subordinated Pledge Assets”).  Seller hereby delivers an irrevocable instruction to Buyer that upon its receipt of notice of an “Event of Default” from the buyer under any Other Repurchase Agreement, Buyer is authorized and instructed to (i) remit to such buyer directly any amounts otherwise payable to Seller under this Agreement and (ii) deliver to such buyer all Subordinated Pledge Assets otherwise deliverable to Seller, to the extent all obligations then due and owing under this Agreement have been paid in full.  In furtherance of the foregoing, upon repayment of the outstanding Purchase Price and termination of all Obligations or other termination of the Program Agreements following repayment of all obligations thereunder, Buyer shall deliver to the buyer under any Other Repurchase Agreement with respect to which the related purchase price remains outstanding any Subordinated Pledge Assets then in Buyer’s possession or under its control. The subordinate pledge set forth in this clause (e) shall automatically terminate with respect to an Other Repurchase Agreement if the Buyer or the other buyer thereunder is no longer CSFB, CSCIB, or any Affiliates thereof.

(f)        The foregoing provisions of this Section 4.02 are intended to constitute a security agreement or other arrangement or other credit enhancement related to this Agreement and the Transactions hereunder as defined under Sections 101(47)(A)(v) and 741(7)(A)(xi) of the Bankruptcy Code.

Section 4.03      Further Documentation.  At any time and from time to time, upon the written request of Buyer, and at the sole expense of Seller, Seller will promptly and duly execute and deliver, or will promptly cause to be executed and delivered, such further instruments and documents and take such further action as Buyer may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, the filing of any financing or continuation statements under the Uniform Commercial Code in effect in any applicable jurisdiction with respect to the Liens created hereby.  Seller also hereby authorizes Buyer to file any such financing or continuation statement to the extent permitted by applicable law.

Section 4.04       Changes in Locations, Name, etc.  Seller shall not (a) change the location of its chief executive office/chief place of business from that specified in Section 3.17 or (b) change its name or identity, unless it shall have given Buyer at least thirty (30) days’ prior written notice thereof and shall have delivered to Buyer all Uniform Commercial Code financing statements and amendments thereto as Buyer shall request and taken all other actions deemed necessary by Buyer to continue its perfected status in the Repurchase Assets with the same or better priority.

Section 4.05       Performance by Buyer of Seller’s Obligations.  If Seller fails to perform or comply with any of its agreements contained in the Program Agreements and Buyer may itself perform or comply, or otherwise cause performance or compliance, with such agreement, the reasonable (under the circumstances) out-of-pocket expenses of Buyer actually incurred in connection with such performance or compliance, together with interest thereon at a rate per annum equal to the Pricing Rate shall be payable by Seller to Buyer on demand and shall constitute Obligations.  Such interest shall be computed on the basis of the actual number of days in each Price Differential Period and a 360-day year.

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Section 4.06       Proceeds.  If an Event of Default shall occur and be continuing, (a) all proceeds of Repurchase Assets received by Seller consisting of cash, checks and other liquid assets readily convertible to cash items shall be held by Seller in trust for Buyer, segregated from other funds of Seller, and shall forthwith upon receipt by Seller be turned over to Buyer in the exact form received by Seller (duly endorsed by Seller to Buyer, if required) and (b) any and all such proceeds received by Buyer (whether from Seller or otherwise) may, in the sole discretion of Buyer, be held by Buyer as collateral security for, and/or then or at any time thereafter may be applied by Buyer against, the Obligations (whether matured or unmatured), such application to be in such order as Buyer shall elect.  Any balance of such proceeds remaining after the Obligations shall have been paid in full and this Agreement shall have been terminated shall be paid over to Seller or to whomsoever may be lawfully entitled to receive the same.

Section 4.07      Remedies.  If an Event of Default shall occur and be continuing, Buyer may exercise, in addition to all other rights and remedies granted to it in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Obligations, all rights and remedies of a secured party under the Uniform Commercial Code (including without limitation, Buyer’s rights to a strict foreclosure under Section 9-620 of the Uniform Commercial Code).  Without limiting the generality of the foregoing, Buyer may seek the appointment of a receiver, liquidator, conservator, trustee, or similar official in respect of Seller or any of Seller’s property.  Buyer without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required under this Agreement or by law referred to below) to or upon Seller or any other Person (each and all of which demands, presentments, protests, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Repurchase Assets, or any part thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Repurchase Assets or any part thereof (or contract to do any of the foregoing), in one or more parcels or as an entirety at public or private sale or sales, at any exchange, broker’s board or office of Buyer or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk.  Buyer shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Repurchase Assets so sold, free of any right or equity of redemption in Seller, which right or equity is hereby waived or released.  Seller further agrees, at Buyer’s request, to assemble the Repurchase Assets and make it available to Buyer at places which Buyer shall reasonably select, whether at Seller’s premises or elsewhere.  Buyer shall apply the net proceeds of any such collection, recovery, receipt, appropriation, realization or sale, after deducting all reasonable (under the circumstances) out-of-pocket costs and expenses of every kind actually incurred therein or incidental to the care or safekeeping of any of the Repurchase Assets or in any way relating to the Repurchase Assets or the rights of Buyer hereunder, including without limitation reasonable attorneys’ fees and disbursements, to the payment in whole or in part of the Obligations, in such order as Buyer may elect, and only after such application and after the payment by Buyer of any other amount required or permitted by any provision of law, including without limitation Section 9-615 of the Uniform Commercial Code, need Buyer account for the surplus, if any, to Seller.  To the extent permitted by applicable law, Seller waives all claims, damages and demands it may acquire against Buyer arising out of the exercise by Buyer of any of its rights hereunder, other than those claims, damages and demands arising from the gross negligence or willful misconduct of Buyer.  If any notice of a proposed sale or other disposition of Repurchase Assets shall be required

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by law, such notice shall be deemed reasonable and proper if given at least ten (10) days before such sale or other disposition.  Seller shall remain liable for any deficiency (plus accrued interest thereon as contemplated herein) if the proceeds of any sale or other disposition of the Repurchase Assets are insufficient to pay the Obligations and the fees and disbursements in amounts reasonable under the circumstances, of any attorneys employed by Buyer to collect such deficiency.

Section 4.08       Limitation on Duties Regarding Preservation of Repurchase Assets.  Buyer’s duty with respect to the custody, safekeeping and physical preservation of the Repurchase Assets in its possession, under Section 9-207 of the Uniform Commercial Code or otherwise, shall be to deal with it in the same manner as Buyer deals with similar property for its own account.  Neither Buyer nor any of its directors, officers or employees shall be liable for failure to demand, collect or realize upon all or any part of the Repurchase Assets or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Repurchase Assets upon the request of Seller or otherwise.

Section 4.09      Powers Coupled with an Interest.  All authorizations and agencies herein contained with respect to the Repurchase Assets are irrevocable and powers coupled with an interest.

Section 4.10       Release of Security Interest.  Upon the latest to occur of (a) the repayment to Buyer of all Obligations hereunder, and (b) the occurrence of the Termination Date, Buyer shall release its security interest in any remaining Repurchase Assets hereunder and shall promptly execute and deliver to Seller such documents or instruments as Seller shall reasonably request to evidence such release.

Section 4.11       Reinstatement.  All security interests created by this Article IV shall continue to be effective, or be reinstated, as the case may be, if at any time any payment, or any part thereof, of any Obligation of Seller is rescinded or must otherwise be restored or returned by the Buyer upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Seller or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Seller or any substantial part of its property, or otherwise, all as if such release had not been made.

ARTICLE V

 

CONDITIONS PRECEDENT

Section 5.01       Initial Transaction.  The obligation of Buyer to enter into Transactions with the Seller hereunder is subject to the satisfaction, immediately prior to or concurrently with the entering into such Transaction, of the condition precedent that Buyer shall have received all of the following items, each of which shall be satisfactory to Buyer and its counsel in form and substance:

(a)        Program Agreements and Note.  The Program Agreements and Note, in all instances duly executed and delivered by the parties thereto and being in full force and effect, free of any modification, breach or waiver.

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(b)        Security Interest.  Evidence that all other actions necessary or, in the opinion of Buyer, desirable to perfect and protect Buyer’s interest in the Repurchase Assets have been taken, including, without limitation, duly authorized and filed Uniform Commercial Code financing statements on Form UCC-1.

(c)        Organizational Documents.  A certificate of the corporate secretary of Seller in form and substance acceptable to Buyer, attaching certified copies of Seller’s certificate of formation, operating agreement and corporate resolutions approving the Program Agreements and transactions thereunder (either specifically or by general resolution) and all documents evidencing other necessary corporate action or governmental approvals as may be required in connection with the Program Agreements.

(d)        Good Standing Certificate.  A certified copy of a good standing certificate from the jurisdiction of organization of Seller, dated as of no earlier than the date ten (10) Business Days prior to the Closing Date.

(e)        Incumbency Certificate.  An incumbency certificate of the corporate secretary of each of Seller, certifying the names, true signatures and titles of the representatives duly authorized to request transactions hereunder and to execute the Program Agreements.

(f)        Fees.  Buyer shall have received payment in full of all fees and Expenses (including, without limitation the Commitment Fee) which are payable hereunder to Buyer on or before such date.

Section 5.02       All Transactions.  The obligation of Buyer to enter into each Transaction pursuant to this Agreement is subject to the following conditions precedent:

(a)        [Reserved].

(b)        Transaction Notice and Asset Schedule.  In accordance with Section 2.02 hereof, Buyer shall have received from Seller a Transaction Notice with an updated Asset Schedule which includes the Note and any Additional Balance, if applicable, related to a proposed Transaction hereunder on such Business Day.

(c)        No Margin Deficit.  After giving effect to each new Transaction, the aggregate outstanding amount of the Purchase Price shall not exceed the Asset Value of the Note then in effect.

(d)        No Default.  No Default or Event of Default shall have occurred and be continuing.

(e)        Requirements of Law.  Buyer shall not have determined that the introduction of or a change in any Requirement of Law or in the interpretation or administration of any Requirement of Law applicable to Buyer has made it unlawful, and no Governmental Authority shall have asserted that it is unlawful, for Buyer to enter into Transactions with a Pricing Rate based on Base Rate.

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(f)        Representations and Warranties.  Both immediately prior to the related Transaction and also after giving effect thereto and to the intended use thereof, the representations and warranties made by Seller in each Program Agreement shall be true, correct and complete on and as of such Purchase Date in all material respects with the same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date).

(g)        Note.  Buyer shall have received the Note and evidence of the Additional Balances relating to any Purchased Assets, which is in form and substance satisfactory to Buyer in its sole discretion.

(h)        Material Adverse Change.  None of the following shall have occurred and/or be continuing:

(A)       Buyer’s corporate bond rating as calculated by S&P or Moody’s has been lowered or downgraded to a rating below investment grade by S&P or Moody’s;

(B)       an event or events shall have occurred in the good faith determination of Buyer resulting in the effective absence of a “lending market” for financing debt obligations secured by mortgage loans or servicing receivables or securities backed by mortgage loans or servicing receivables or an event or events shall have occurred resulting in Buyer not being able to finance the Note through the “lending market” with traditional counterparties at rates which would have been reasonable prior to the occurrence of such event or events; or

(C)       there shall have occurred a material adverse change in the financial condition of Buyer which affects (or can reasonably be expected to affect) materially and adversely the ability of Buyer to fund its obligations under this Agreement.

(i)         Fees.  Buyer shall have received payment in full of all fees and Expenses (including, without limitation the Commitment Fee) which are payable hereunder to Buyer on or before such date.

Section 5.03       Closing Subject to Conditions Precedent.  The obligation of the Buyer to purchase the Note is subject to the satisfaction on or prior to the Closing Date of the following conditions (any or all of which may be waived by the Buyer):

(a)        Performance by the Issuer and PLS.  All the terms, covenants, agreements and conditions of the Transaction Documents to be complied with, satisfied, observed and performed by the Issuer, and PLS on or before the Closing Date shall have been complied with, satisfied, observed and performed in all material respects.

(b)        Representations and Warranties.  Each of the representations and warranties of the Issuer and PLS made in the Transaction Documents shall be true and correct in all material respects as of the Closing Date (except that such materiality qualifier shall not be applicable to any

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representations and warranties that already are qualified or modified by materiality in the text thereof and except to the extent they expressly relate to an earlier or later time).

(c)        Officer’s Certificate.  The Administrative Agent, the Buyer and the Indenture Trustee shall have received in form and substance reasonably satisfactory to the Administrative Agent an officer’s certificate from PLS and a certificate of an Authorized Officer of the Issuer, dated the Closing Date, each certifying to the satisfaction of the conditions set forth in the preceding paragraphs (a) and (b), in each case together with incumbency, by-laws, resolutions and good standing.

(d)        Opinions of Counsel to the Issuer and PLS.  Counsel to the Issuer and PLS shall have delivered to the Administrative Agent, the Buyer and the Indenture Trustee favorable opinions, dated the Closing Date and satisfactory in form and substance to the Administrative Agent and its counsel, relating to corporate matters, enforceability, safe harbor, non-consolidation and perfection and an opinion as to which state’s law applies to security interest and perfection matters.  In addition to the foregoing, PLS, as servicer, shall have caused its counsel to deliver to the Issuer, the Buyer, as purchaser of the Note hereunder, the Administrative Agent and the Indenture Trustee an opinion as to certain tax matters dated as of the Closing Date, satisfactory in form and substance to the Administrative Agent, the Buyer and their respective counsel.

(e)        Officer’s Certificate of Indenture Trustee.  The Administrative Agent and the Buyer shall have received in form and substance reasonably satisfactory to the Administrative Agent an Officer’s Certificate from the Indenture Trustee, dated the Closing Date, with respect to the Base Indenture, together with incumbency and good standing.

(f)        Opinions of Counsel to the Indenture Trustee.  Counsel to the Indenture Trustee shall have delivered to the Administrative Agent and the Buyer a favorable opinion dated the Closing Date and reasonably satisfactory in form and substance to the Administrative Agent and its counsel related to the enforceability of the Base Indenture.

(g)        Opinions of Counsel to the Owner Trustee.  Delaware counsel to the Owner Trustee of the Issuer shall have delivered to the Administrative Agent and the Buyer favorable opinions regarding the formation, existence and standing of the Issuer and of the Issuer’s execution, authorization and delivery of each of the Transaction Documents to which it is a party and such other matters as the Administrative Agent and the Buyer may reasonably request, dated the Closing Date and reasonably satisfactory in form and substance to the Administrative Agent and the Buyer and their respective counsel.

(h)        Filings and Recordations.  The Administrative Agent, the Buyer and the Indenture Trustee shall have received evidence reasonably satisfactory to the Administrative Agent of (i) the completion of all recordings, registrations and filings as may be necessary or, in the reasonable opinion of the Administrative Agent, desirable to perfect or evidence: (A) the assignment by PLS, as Seller, to the Issuer of the ownership interest in the Collateral conveyed pursuant to the PC Repurchase Agreement and the proceeds thereof and (ii) the completion of all recordings, registrations, and filings as may be necessary or, in the reasonable opinion of the Administrative Agent, desirable to perfect or evidence the grant of a first priority perfected security

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interest in the Issuer’s ownership interest in the Collateral in favor of the Indenture Trustee, subject to no Liens prior to the Lien created by the Base Indenture.

(i)         Documents.  The Administrative Agent, the Buyer and the Indenture Trustee shall have received a duly executed counterpart of each of the Transaction Documents (including the Fee Letter related to the Note, if any), in form acceptable to the Buyer, the Note and each and every document or certification delivered by any party in connection with any such Transaction Documents or the Note, and each such document shall be in full force and effect.

(j)         Actions or Proceedings.  No action, suit, proceeding or investigation by or before any Governmental Authority shall have been instituted to restrain or prohibit the consummation of, or to invalidate, any of the transactions contemplated by the Transaction Documents, the Note and the documents related thereto in any material respect.

(k)        Approvals and Consents.  All Governmental Actions of all Governmental Authorities required with respect to the transactions contemplated by the Transaction Documents, the Note and the documents related thereto shall have been obtained or made.

(l)         Fees, Costs and Expenses.  Buyer shall have received payment in full of all fees and Expenses (including, without limitation the Commitment Fee) which are payable hereunder to Buyer on or before the Closing Date, and the fees, costs and expenses payable by the Issuer and PLS on or prior to the Closing Date pursuant to this Agreement or any other Transaction Document shall have been paid in full.

(m)       [Reserved].

(n)        Other Documents.  PLS shall have furnished to the Administrative Agent, the Buyer and the Indenture Trustee such other opinions, information, certificates and documents as the Administrative Agent may reasonably request.

(o)        Advance Verification Agent.  PLS shall have engaged the Advance Verification Agent pursuant to an agreement reasonably satisfactory to the Administrative Agent.

(p)        Proceedings in Contemplation of Sale of the Note.  All actions and proceedings undertaken by the Issuer and PLS in connection with the issuance and sale of the Note as herein contemplated shall be satisfactory in all respects to the Administrative Agent, the Buyer and their respective counsel.

(q)        SPIA Advance Receivable Advance Rate Reduction Event , Servicer Termination Events, Events of Default and Funding Interruption Events.  No SPIA Advance Receivable Advance Rate Reduction Event, Servicer Termination Event, Event of Default or Funding Interruption Event shall then be occurring.

(r)        Satisfaction of Conditions.  Each of the Funding Conditions and the SPIADVF1 Funding Conditions shall have been satisfied. The Administrator shall include the SPIADVF1 Funding Conditions in each Funding Certification in addition to the Funding Conditions and present a “yes” or “no” answer beside such SPIADVF1 Funding Conditions

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indicating whether such SPIADVF1 Funding Conditions have been satisfied, as set forth in Section 4.3 of the Base Indenture.

If any condition specified in this Section 5.03 shall not have been fulfilled when and as required to be fulfilled, this Agreement may be terminated by the Buyer by notice to PLS at any time at or prior to the Closing Date, and the Buyer shall incur no liability as a result of such termination.

ARTICLE VI

 

COVENANTS

Seller covenants and agrees that until the payment and satisfaction in full of all Obligations, whether now existing or arising hereafter, shall have occurred:

Section 6.01       Litigation.  Seller will promptly, and in any event within ten (10) days after service of process on any of the following, give to Buyer 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 or any of its 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 $10,000,000, or (iii) which, individually or in the aggregate, if adversely determined, could be reasonably likely to have a Material Adverse Effect.  On the fifth (5th) day of each calendar month (or if such day is not a Business Day, the next succeeding Business Day), Seller will provide to Buyer a litigation docket listing 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 or any of its Subsidiaries or affecting any of the Property of any of them before any Governmental Authority.  Seller will promptly provide notice of any judgment, which with the passage of time, could cause an Event of Default hereunder.

Section 6.02       Prohibition of Fundamental Changes.  Seller shall not enter into any transaction of merger or consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation, winding up or dissolution) or sell all or substantially all of its assets; provided, that Seller may merge or consolidate with (a) any wholly owned subsidiary of Seller, or (b) any other Person if Seller is the surviving entity; and provided further, that if after giving effect thereto, no Default would exist hereunder.

Section 6.03       Weekly Reporting.  Seller shall at all times maintain a current list (which may be stored in electronic form) of the Note and Additional Balances.  Seller shall deliver to Buyer on the third Business Day of each week (the “Weekly Report Date”) a cumulative Asset Schedule, each of which, when so delivered, shall replace the current Asset Schedule and which may be delivered in electronic form acceptable to Buyer.  Each such updated Asset Schedule shall indicate the outstanding VFN Principal Balance of the Note as of the close of the preceding week.  As of each Weekly Report Date, Seller hereby certifies, represents and warrants to Buyer that each such updated Asset Schedule is true, complete and correct in all material respects.

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Section 6.04       No Adverse Claims.  Seller warrants and will defend the right, title and interest of Buyer in and to all Purchased Assets against all adverse claims and demands.

Section 6.05       Assignment.  Except as permitted herein, Seller shall not sell, assign, transfer or otherwise dispose of, or grant any option with respect to, or pledge, hypothecate or grant a security interest in or lien on or otherwise encumber (except pursuant to the Program Agreements), any of the Purchased Assets or any interest therein, provided that this Section 6.06 shall not prevent any transfer of Purchased Assets in accordance with the Program Agreements.

Section 6.06       Security Interest.  Seller shall do all things necessary to preserve the Purchased Assets so that they remain subject to a first priority perfected security interest hereunder.  Without limiting the foregoing, Seller will comply with all rules, regulations and other laws of any Governmental Authority and cause the Purchased Assets to comply with all applicable rules, regulations and other laws.  Seller will not allow any default for which Seller is responsible to occur under any Purchased Assets or any Program Agreement and Seller shall fully perform or cause to be performed when due all of its obligations under any Purchased Assets and any Program Agreement.

Section 6.07       Records.

(a)        Seller shall collect and maintain or cause to be collected and maintained all Records relating to the Purchased Assets in accordance with industry custom and practice for assets similar to the Purchased Assets, including those maintained pursuant to Section 6.08, and all such Records shall be in Seller’s possession unless Buyer otherwise approves.  Seller will maintain all such Records in good and complete condition in accordance with industry practices for assets similar to the Purchased Assets and preserve them against loss.

(b)        For so long as Buyer has an interest in or lien on any Purchased Assets, Seller will hold or cause to be held all related Records in trust for Buyer.  Seller shall notify, or cause to be notified, every other party holding any such Records of the interests and liens in favor of Buyer granted hereby.

(c)        Upon reasonable advance notice from Buyer, Seller shall (x) make any and all such Records available to Buyer to examine any such Records, either by its own officers or employees, or by agents or contractors, or both, and make copies of all or any portion thereof, and (y) permit Buyer or its authorized agents to discuss the affairs, finances and accounts of Seller with its chief operating officer and chief financial officer and to discuss the affairs, finances and accounts of Seller with its independent certified public accountants.

Section 6.08       Books.  Seller shall keep or cause to be kept in reasonable detail books and records of account of its assets and business and shall clearly reflect therein the transfer of Purchased Assets to Buyer.

Section 6.09       Approvals.  Seller shall maintain all licenses, permits or other approvals necessary for Seller to conduct its business and to perform its obligations under the Program Agreements, and Seller shall conduct its business strictly in accordance with applicable law.

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Section 6.10       Material Change in Business.  Seller shall not make any material change in the nature of its business as carried on at the Closing Date.

Section 6.11       Distributions.  If an Event of Default has occurred and is continuing, Seller shall not pay any dividends with respect to any capital stock or other equity interests in such entity, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of Seller.

Section 6.12       Applicable Law.  Seller shall comply with the requirements of all applicable laws, rules, regulations and orders of any Governmental Authority.

Section 6.13       Existence.  Seller shall preserve and maintain its legal existence and all of its material rights, privileges, licenses and franchises.

Section 6.14       Chief Executive Office; Jurisdiction of Organization.  Seller shall not move its chief executive office from the address referred to in Section 3.17 or change its jurisdiction of organization from the jurisdiction referred to in Section 3.17 unless it shall have provided Buyer at least thirty (30) days’ prior written notice of such change.

Section 6.15       Taxes.  Seller shall timely file all tax returns that are required to be filed by them and shall timely pay and discharge all taxes, assessments and governmental charges or levies imposed on it or on its income or profits or on any of its property prior to the date on which penalties attach thereto, except for any such tax, assessment, charge or levy the payment of which is being contested in good faith and by proper proceedings and against which adequate reserves are being maintained.

Section 6.16       Transactions with Affiliates.  Other than the purchase of the Note, Seller will not enter into any transaction, including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service, with any Affiliate unless such transaction (a) does not result in a Default hereunder, (b) is in the ordinary course of Seller’s business and (c) is upon fair and reasonable terms no less favorable to Seller than it would obtain in a comparable arm’s length transaction with a Person which is not an Affiliate, or make a payment that is not otherwise permitted by this Section 6.16 to any Affiliate.

Section 6.17      Guarantees.  Seller shall not create, incur, assume or suffer to exist any Guarantees, except (i) to the extent reflected in Seller’s financial statements or notes thereto and (ii) to the extent the aggregate Guarantees of Seller do not exceed $250,000.

Section 6.18       Indebtedness.  Seller shall not incur any additional material Indebtedness other than (i) the Existing Indebtedness specified on Exhibit B hereto; (ii) Indebtedness incurred with Buyer or its Affiliates; (iii) Indebtedness incurred in connection with new or existing secured lending facilities and (iv) usual and customary accounts payable for a mortgage company), without the prior written consent of Buyer.

Section 6.19      True and Correct Information.  All information, reports, exhibits, schedules, financial statements or certificates of Seller, any Affiliate thereof or any of their officers furnished to Buyer hereunder and during Buyer’s diligence of Seller are and will be true and complete in all material respects and do not omit to disclose any material facts necessary to make

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the statements herein or therein, in light of the circumstances in which they are made, not misleading.  All required financial statements, information and reports delivered by Seller to Buyer pursuant to this Agreement shall be prepared in accordance with U.S. GAAP, or, if applicable, to SEC filings, the appropriate SEC accounting regulations.

Section 6.20       No Pledge.  Except as contemplated herein, Seller shall not pledge, grant a security interest or assign any existing or future rights to service any of the Repurchase Assets or pledge or grant to any other Person any security interest in the Note.

Section 6.21       Plan Assets.  Seller shall not be an employee benefit plan as defined in Section 3 of Title I of ERISA, or a plan described in Section 4975(e)(1) of the Code and Seller shall not use “plan assets” within the meaning of 29 CFR § 2510.3 101, as amended by Section 3(42) of ERISA to engage in this Agreement or any Transaction hereunder.  Transactions to or with Seller shall not be subject to any state or local statute regulating investments of or fiduciary obligations with respect to governmental plans within the meaning of Section 3(32) of ERISA.

Section 6.22       Sharing of Information.  Seller shall allow Buyer to exchange information related to Seller and the Transactions hereunder with third party lenders and Seller shall permit each third party lender to share such information with Buyer.

Section 6.23      Modification of the Base Indenture and Series 2020-SPIADVF1 Indenture Supplement.  Seller shall not consent with respect to any of the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement related to the Purchased Assets, to (i) the modification, amendment or termination of the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement, (ii) the waiver of any provision of the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement, or (iii) the resignation of PLS as servicer under the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement, or the assignment, transfer, or material delegation of any of its rights or obligations, under such the Base Indenture and the Series 2020-SPIADVF1 Indenture Supplement, without the prior written consent of Buyer exercised in Buyer’s sole discretion.

Section 6.24       Reporting Requirements.

(a)        Seller shall furnish to Buyer (i) promptly, copies of any material and adverse notices (including, without limitation, notices of defaults, breaches, potential defaults or potential breaches) and any material financial information that is not otherwise required to be provided by Seller hereunder which is given to Seller’s lenders, (ii) promptly, notice of the occurrence of (1) any Event of Default hereunder; (2) any default or material breach by Seller of any obligation under any Program Agreement or any material contract or agreement of Seller or (3) the occurrence of any event or circumstance that such party reasonably expects has resulted in, or will, with the passage of time, result in, a Material Adverse Effect or an Event of Default and (iii) the following:

(1)        as soon as available and in any event within forty (40) calendar days after the end of each calendar month, the unaudited balance sheet of Seller, as at the end of such period and the related unaudited consolidated statements of income

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for Seller for such period and the portion of the fiscal year through the end of such period, accompanied by a certificate of a Responsible Officer of Seller, which certificate shall state that said consolidated financial statements or financial statements, as applicable, fairly present in all material respects the consolidated financial condition or financial condition, as applicable, and results of operations of Seller in accordance with GAAP, consistently applied, as at the end of, and for, such period (subject to normal year-end adjustments);

(2)        as soon as available and in any event within forty (40) calendar days after the end of each calendar quarter, the unaudited cash flow statements of Seller, as at the end of such period and the portion of the fiscal year through the end of such period, accompanied by a certificate of a Responsible Officer of Seller, which certificate shall state that said consolidated financial statements or financial statements, as applicable, fairly present in all material respects the consolidated financial condition or financial condition, as applicable, and results of operations of Seller in accordance with GAAP, consistently applied, as at the end of, and for, such period (subject to normal year-end adjustments);

(3)        as soon as available and in any event within ninety (90) days after the end of each fiscal year of Seller, the balance sheet of Seller, as at the end of such fiscal year and the related consolidated statements of income and retained earnings and of cash flows for Seller for such year, setting forth in comparative form the figures for the previous year, accompanied by an opinion thereon of independent certified public accountants of recognized national standing, which opinion and the scope of audit shall be acceptable to Buyer in its sole discretion, shall have no “going concern” qualification and shall state that said consolidated financial statements or financial statements, as applicable, fairly present the consolidated financial condition or financial condition, as applicable, and results of operations of Seller as at the end of, and for, such fiscal year in accordance with GAAP;

(4)        such other prepared statements that Buyer may reasonably request;

(5)        [reserved];

(6)        from time to time such other information regarding the financial condition, operations, or business of Seller as Buyer may reasonably request;

(7)        as soon as reasonably possible, and in any event within thirty (30) days after a Responsible Officer of Seller has knowledge of the occurrence of any ERISA Event of Termination, stating the particulars of such ERISA Event of Termination in reasonable detail;

(8)        as soon as reasonably possible, notice of any of the following events:

a.          any material dispute, litigation, investigation, proceeding or suspension between Seller on the one hand, and any Governmental Authority or any Person;

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b.         any material change in accounting policies or financial reporting practices of Seller;

c.          any material issues raised upon examination of Seller or Seller’s facilities by any Governmental Authority;

d.         any material change in the Indebtedness of Seller, including, without limitation, any default, renewal, non-renewal, termination, increase in available amount or decrease in available amount related thereto;

e.          promptly upon receipt of notice or knowledge of any lien or security interest (other than security interests created hereby or by the other Program Agreements) on, or claim asserted against, any of the Purchased Assets; and

f.          any other event, circumstance or condition that has resulted, or has a reasonable possibility of resulting, in a Material Adverse Effect with respect to Seller.

(b)        Officer’s Certificates.  Seller will furnish to Buyer, at the time Seller furnishes each set of financial statements pursuant to Section 6.24(a)(iii)(1),  (2) or (3) above, an Officer’s Compliance Certificate of Seller in the form of Exhibit A to the MLRA Pricing Side Letter.

(c)        Other.  Seller shall deliver to Buyer any other reports or information reasonably requested by Buyer or as otherwise required pursuant to this Agreement and the Indenture (including, without limitation, all reports and information delivered by the Issuer, the Administrator or the Indenture Trustee relating to the Note).

(a)        Regulatory Reporting Compliance.  Seller shall, on or before the last Business Day of the fifth (5th) month following the end of each of Seller’s fiscal years (December 31), beginning with the fiscal year ending in 2019, deliver to Buyer a copy of the results of any Uniform Single Attestation Program for Mortgage Bankers or an Officer’s Certificate that satisfies the requirements of Item 1122(a) of Regulation AB, an independent public accountant’s report that satisfies the requirements of Item 1123 of Regulation AB, or similar review conducted on Seller by its accountants, and such other reports as Seller may prepare relating to its servicing functions as Seller.

Section 6.25       Liens on Substantially All Assets.  Seller shall not grant a security interest to any Person other than Buyer or an Affiliate of Buyer in substantially all assets of Seller unless Seller has entered into an amendment to this Agreement that grants to Buyer a pari passu security interest on such assets.

Section 6.26       Litigation Summary.  On each date on which the Officer’s Compliance Certificate is delivered, Seller shall provide to Buyer a true and correct summary of all material actions, notices, proceedings and investigations pending with respect to which Seller has received service of process or other form of notice or, to the best of Seller’s knowledge,

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threatened against it, before any court, administrative or governmental agency or other regulatory body or tribunal.

Section 6.27      Hedging.  On each date on which the Officer’s Compliance Certificate is delivered, Seller shall provide a true and correct summary of all interest rate protection agreements entered into or maintained by Seller.

Section 6.28       [Reserved].

Section 6.29      Most Favored Status. Seller and Buyer each agree that should Seller or any Affiliate thereof enter into a repurchase agreement or credit facility with any Person other than Buyer or an Affiliate of Buyer which by its terms provides any of the following (each, a “More Favorable Agreement”):

(a)        more favorable terms with respect to any guaranties or financial covenants, including without limitation covenants covering the same or similar subject matter set forth or referred to in Section 6.11 hereof and Section 2 of the Pricing Side Letter;

(b)        a security interest to any Person other than Buyer or an Affiliate of Buyer in substantially all assets of Seller or any Affiliate thereof; or

(c)        a requirement that Seller has added or will add any Person other than Buyer or an Affiliate of Buyer as a loss payee under Seller’s Fidelity Insurance;

then the terms of this Agreement shall be deemed automatically amended to include such more favorable terms contained in such More Favorable Agreement, such that such terms operate in favor of Buyer or an Affiliate of Buyer; provided, that in the event that such More Favorable Agreement is terminated, upon notice by Seller to Buyer of such termination, the original terms of this Agreement shall be deemed to be automatically reinstated. Seller and Buyer further agree to execute and deliver any new guaranties, agreements or amendments to this Agreement evidencing such provisions, provided that the execution of such amendment shall not be a precondition to the effectiveness of such amendment, but shall merely be for the convenience of the parties hereto. Promptly upon Seller or any Affiliate thereof entering into a repurchase agreement or other credit facility with any Person other than Buyer, Seller shall deliver to Buyer a true, correct and complete copy of such repurchase agreement, loan agreement, guaranty or other financing documentation.

 

ARTICLE VII

 

DEFAULTS/RIGHTS AND REMEDIES OF BUYER UPON DEFAULT

Section 7.01       Events of Default.  Each of the following events or circumstances shall constitute an “Event of Default”:

(a)        Payment Failure.  Failure of Seller to (i) make any payment (which failure continues for a period of two (2) Business Days following written notice (which may be in electronic form) from Buyer) of Price Differential or Repurchase Price or any other sum which has become due, on a Price Differential Payment Date or a Repurchase Date or otherwise, whether

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by acceleration or otherwise, under the terms of this Agreement, any other warehouse and security agreement or any other document, in each case evidencing or securing Indebtedness of Seller to Buyer or to any Affiliate of Buyer, or (ii) cure any Margin Deficit when due pursuant to Section 2.05 hereof.

(b)        Cross Default.  Seller or Affiliates thereof shall be in default under (i) any Program Agreement or any Repurchase Document; provided that any such default under the Indenture shall constitute an “Event of Default” only if it continues unremedied for a period of two (2) Business Days after a Responsible Officer of the Seller obtains actual knowledge of such failure, or receives written notice from Buyer of such default; (ii) any Indebtedness, in the aggregate, in excess of $1 million of Seller or any Affiliate thereof which default (1) involves the failure to pay a matured obligation, or (2) permits the acceleration of the maturity of obligations by any other party to or beneficiary with respect to such Indebtedness, or (iii) any other contract or contracts, in the aggregate in excess of $1 million to which Seller or any Affiliate thereof is a party which default (1) involves the failure to pay a matured obligation, or (2) permits the acceleration of the maturity of obligations by any other party to or beneficiary of such contract.

(c)        Assignment.  Assignment or attempted assignment by Seller of this Agreement or any rights hereunder without first obtaining the specific written consent of Buyer, or the granting by Seller of any security interest, lien or other encumbrances on any Purchased Assets to any person other than Buyer.

(d)        Insolvency.  An Act of Insolvency shall have occurred with respect to Seller or any Affiliate thereof.

(e)        Material Adverse Change.  Any material adverse change in the Property, business, financial condition or operations of Seller or any of its Affiliates shall occur, in each case as determined by Buyer in its sole good faith discretion, or any other condition shall exist which, in Buyer’s sole good faith discretion, constitutes a material impairment of Seller’s ability to perform its obligations under this Agreement or any other Program Agreement.

(f)        Immediate Breach of Representation or Covenant or Obligation.  A breach by Seller of any of the representations, warranties or covenants or obligations set forth in Sections 3.01  (Seller Existence), 3.07  (Solvency), 3.12  (Material Adverse Change), Section 3.22  (Other Indebtedness), Section 6.02  (Prohibition of Fundamental Changes), Section 6.13  (Existence), Section 6.17  (Guarantees), Section 6.18  (Indebtedness), Section 6.20  (No Pledge) or Section 6.21  (Plan Assets) of this Agreement.

(g)        Additional Breach of Representation or Covenant.  A material breach by Seller of any other material representation, warranty or covenant set forth in this Agreement (and not otherwise specified in Section 7.01(f) above), if such breach is not cured within five (5) Business Days or, in the case of a breach of Section 6.03, three (3) Business Days.

(h)        Change in Control.  The occurrence of a Change in Control.

(i)         Failure to Transfer.  Seller fails to transfer a material portion of the Purchased Assets to Buyer on the applicable Purchase Date (provided Buyer has tendered the related Purchase Price).

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(j)         Judgment.  A final judgment or judgments for the payment of money in excess of $10,000,000 shall be rendered against Seller or any of their Affiliates by one or more courts, administrative tribunals or other bodies having jurisdiction and the same shall not be satisfied, discharged (or provision shall not be made for such discharge) or bonded, or a stay of execution thereof shall not be procured, within thirty (30) days from the date of entry thereof.

(k)        Government Action.  Any Governmental Authority or any person, agency or entity acting or purporting to act under governmental authority shall have taken any action to condemn, seize or appropriate, or to assume custody or control of, all or any substantial part of the Property of Seller or any Affiliate thereof, or shall have taken any action to displace the management of Seller or any Affiliate thereof or to curtail its authority in the conduct of the business of Seller or any Affiliate thereof, or takes any action in the nature of enforcement to remove, limit or restrict the approval of Seller or Affiliate as an issuer, buyer or a seller/servicer of mortgage loans or securities backed thereby, and such action provided for in this subparagraph (l) shall not have been discontinued or stayed within thirty (30) days.

(l)         Inability to Perform.  A Responsible Officer of Seller or VFN Guarantor shall admit its inability to, or its intention not to, perform any of Seller’s Obligations or VFN Guarantor’s obligations hereunder or the VFN Guaranty.

(m)       Security Interest.  This Agreement shall for any reason cease to create a valid, first priority security interest in any material portion of the Repurchase Assets purported to be covered hereby.

(n)        Financial Statements.  Seller’s audited annual financial statements or the notes thereto or other opinions or conclusions stated therein shall be qualified or limited by reference to the status of Seller as a “going concern” or a reference of similar import.

(o)        Validity of Agreement.  For any reason, this Agreement at any time shall not be in full force and effect in all material respects or shall not be enforceable in all material respects in accordance with its terms, or any Lien granted pursuant thereto shall fail to be perfected and of first priority, or Seller or any Affiliate of Seller shall seek to disaffirm, terminate, limit or reduce its obligations hereunder or VFN Guarantor’s obligations under the VFN Guaranty.

(p)        VFN Guarantor Breach.  A breach by VFN Guarantor of any material representation, warranty or covenant set forth in the VFN Guaranty or any other Program Agreement, any “event of default” by VFN Guarantor under the VFN Guaranty, any repudiation of the VFN Guaranty by VFN Guarantor, or if the VFN Guaranty is not enforceable against VFN Guarantor.

Section 7.02      No Waiver.  An Event of Default shall be deemed to be continuing unless expressly waived by Buyer in writing.

Section 7.03       Due and Payable.  Upon the occurrence of any Event of Default which has not been waived in writing by Buyer, Buyer may, by notice to Seller, declare all Obligations to be immediately due and payable, and any obligation of Buyer to enter into Transactions with Seller shall thereupon immediately terminate.  Upon such declaration, the Obligations shall become immediately due and payable, both as to Purchase Price outstanding and

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Price Differential, without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived, anything contained herein or other evidence of such Obligations to the contrary notwithstanding, except with respect to any Event of Default set forth in Section 7.01(d), in which case all Obligations shall automatically become immediately due and payable without the necessity of any notice or other demand, and any obligation of Buyer to enter into Transactions with Seller shall immediately terminate.  Buyer may enforce payment of the same and exercise any or all of the rights, powers and remedies possessed by Buyer, whether under this Agreement or any other Program Agreement or afforded by applicable law.

Section 7.04       Fees.  The remedies provided for herein are cumulative and are not exclusive of any other remedies provided by law.  Seller agrees to pay to Buyer reasonable attorneys’ fees and reasonable legal expenses incurred in enforcing Buyer’s rights, powers and remedies under this Agreement and each other Program Agreement.

Section 7.05       Default Rate.  Without regard to whether Buyer has exercised any other rights or remedies hereunder, if an Event of Default shall have occurred and be continuing, the applicable Margin in respect of the Pricing Rate shall be increased, to the extent permitted by law, as set forth in clause (ii) of the definition of “Margin”.

ARTICLE VIII

 

ENTIRE AGREEMENT; AMENDMENTS

AND WAIVERS; SEPARATE ACTIONS BY BUYER

Section 8.01       Entire Agreement.  This Agreement (including the Schedules and Exhibits hereto) constitutes the entire agreement of the parties hereto and supersedes any and all prior or contemporaneous agreements, written or oral, as to the matters contained herein, and no modification or waiver of any provision hereof or any of the Program Agreements, nor consent to the departure by Seller therefrom, shall be effective unless the same is in writing, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which it is given.

Section 8.02      Waivers, Separate Actions by Buyer.  Any amendment or waiver effected in accordance with this Article VIII shall be binding upon Buyer and Seller; and Buyer’s failure to insist upon the strict performance of any term, condition or other provision of this Agreement or any of the Program Agreements, or to exercise any right or remedy hereunder or thereunder, shall not constitute a waiver by Buyer of any such term, condition or other provision or Default or Event of Default in connection therewith, nor shall a single or partial exercise of any such right or remedy preclude any other or future exercise, or the exercise of any other right or remedy; and any waiver of any such term, condition or other provision or of any such Default or Event of Default shall not affect or alter this Agreement or any of the Program Agreements, and each and every term, condition and other provision of this Agreement and the Program Agreements shall, in such event, continue in full force and effect and shall be operative with respect to any other then existing or subsequent Default or Event of Default in connection therewith.  An Event of Default hereunder or under any of the Program Agreements shall be deemed to be continuing unless and until waived in writing by Buyer.

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ARTICLE IX

 

SUCCESSORS AND ASSIGNS

Section 9.01       Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, any portion thereof, or any interest therein.  Seller shall not have the right to assign all or any part of this Agreement or any interest herein without the prior written consent of Buyer.

Section 9.02       Participations and Transfers.

(a)        Buyer may in accordance with applicable law at any time sell to one or more banks or other entities (“Participants”) participating interests in all or a portion of Buyer’s rights and obligations under this Agreement and the other Program Agreements; provided,  that (i) Seller has consented to such sale; provided,  however, Seller’s consent shall not be required in the event that (A) such Participant is an Affiliate of Buyer or (B) an Event of Default has occurred; (ii) each such sale shall represent an interest in a Transaction in a Purchase Price of $1,000,000 or more and (iii) other than with respect to a participating interest consisting of a pro rata interest in all payments due to Buyer under this Agreement and prior to an Event of Default Buyer receives an opinion of a nationally recognized tax counsel experienced in such matters that such sale will not result in the Issuer being subject to tax on its net income as an association (or publicly traded partnership) taxable as a corporation or a taxable mortgage pool taxable as a corporation, each for U.S. federal income tax purposes.  In the event of any such sale by Buyer of participating interests to a Participant, Buyer shall remain a party to the Transaction for all purposes under this Agreement and the Program Agreements and Seller shall continue to deal solely and directly with Buyer in connection with Buyer’s rights and obligations under this Agreement and the Program Agreements.

(b)        Buyer may in accordance with applicable law at any time assign, pledge, hypothecate, or otherwise transfer to one or more banks, financial institutions, investment companies, investment funds or any other Person (each, a “Transferee”) all or a portion of Buyer’s rights and obligations under this Agreement and the other Program Agreements; provided,  that (i) Seller has consented to such assignment, pledge, hypothecation, or other transfer; provided,  however, Seller’s consent shall not be required in the event that (A) such Transferee is an Affiliate of Buyer or (B) an Event of Default has occurred; (ii) absent an Event of Default, Buyer shall give at least ten days’ prior notice thereof to Seller; (iii) that each such sale shall represent an interest in the Transactions in an aggregate Purchase Price of $1,000,000 or more, (iv) such Transferee shall have also acquired the same percentage interest in each other Series of Variable Funding Notes, unless Ginnie Mae has consented in writing to waive this requirement, and (v) other than with respect to an assignment, pledge, hypothecation or transfer consisting of a pro rata interest in all payments due to Buyer under this Agreement and prior to an Event of Default Buyer received an opinion of a nationally recognized tax counsel experienced in such matters that such assignment, pledge, hypothecation or transfer  will not result in the Issuer being subject to tax on its net income as an association (or publicly traded partnership) taxable as a corporation or a taxable mortgage pool taxable as a corporation, each for U.S. federal income tax purposes.  In the event of any such assignment, pledge, hypothecation or transfer by Buyer of Buyer’s rights under this Agreement and the other Program Agreements, Seller shall continue to deal solely and directly

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with Buyer in connection with Buyer’s rights and obligations under this Agreement.  Buyer (acting as agent for Seller) shall maintain at its address referred to in Section 10.05 a register (the “Register”) for the recordation of the names and addresses of Transferees, and the Purchase Price outstanding and Price Differential in the Transactions held by each thereof.  The entries in the Register shall be prima facie conclusive and binding, and Seller may treat each Person whose name is recorded in the Register as the owner of the Transactions recorded therein for all purposes of this Agreement.  No assignment shall be effective until it is recorded in the Register.

(c)        All actions taken by Buyer pursuant to this Section 9.02 shall be at the expense of Buyer.  Buyer may distribute to any prospective assignee any document or other information delivered to Buyer by Seller.

Section 9.03       Buyer and Participant Register.

(a)        Subject to acceptance and recording thereof pursuant to paragraph (b) of this Section 9.03, from and after the effective date specified in each assignment and acceptance the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such assignment and acceptance, have the rights and obligations of Buyer under this Agreement.  Any assignment or transfer by Buyer of rights or obligations under this Agreement that does not comply with this Section 9.03 shall be treated for purposes of this Agreement as a sale by such Buyer of a participation in such rights and obligations in accordance with Section 9.02.

(b)        Seller or an agent of Seller shall maintain a register (the “Transaction Register”) on which it will record the Transactions entered into hereunder, and each assignment and acceptance and participation.  The Transaction Register shall include the names and addresses of Buyers (including all assignees, successors and Participants), and the Purchase Price of the Transactions entered into by Buyer.  Failure to make any such recordation, or any error in such recordation shall not affect Seller’s obligations in respect of such Transactions.  If Buyer sells a participation in any Transaction, it shall provide Seller, or maintain as agent of Seller, the information described in this paragraph and permit Seller to review such information as reasonably needed for Seller to comply with its obligations under this Agreement or under any applicable law or governmental regulation or procedure.

ARTICLE X

 

MISCELLANEOUS

Section 10.01     Survival.  This Agreement and the other Program Agreements and all covenants, agreements, representations and warranties herein and therein and in the certificates delivered pursuant hereto and thereto, shall survive the entering into of the Transaction and shall continue in full force and effect so long as any Obligations are outstanding and unpaid.

Section 10.02     Indemnification.  Seller shall, and hereby agrees to, indemnify, defend and hold harmless Buyer, any Affiliate of Buyer and their respective directors, officers, agents, employees and counsel from and against any and all losses, claims, damages, liabilities, deficiencies, judgments or expenses incurred by any of them (except to the extent that it is finally judicially determined to have resulted from their own gross negligence or willful misconduct) as

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a consequence of, or arising out of or by reason of any litigation, investigations, claims or proceedings which arise out of or are in any way related to, (i) this Agreement or any other Program Agreement or the transactions contemplated hereby or thereby, (ii) Seller’s servicing practices or procedures; (iii) any actual or proposed use by Seller of the proceeds of the Purchase Price, and (iv) any Default, Event of Default or any other breach by Seller of any of the provisions of this Agreement or any other Program Agreement, including, without limitation, amounts paid in settlement, court costs and reasonable fees and disbursements of counsel incurred in connection with any such litigation, investigation, claim or proceeding or any advice rendered in connection with any of the foregoing.  If and to the extent that any Obligations are unenforceable for any reason, Seller hereby agrees to make the maximum contribution to the payment and satisfaction of such Obligations which is permissible under applicable law.  Seller’s obligations set forth in this Section 10.02 shall survive any termination of this Agreement and each other Program Agreement and the payment in full of the Obligations, and are in addition to, and not in substitution of, any other of its obligations set forth in this Agreement or otherwise.  In addition, Seller shall, upon demand, pay to Buyer all costs and Expenses (including the reasonable fees and disbursements of counsel) paid or incurred by Buyer in (i) enforcing or defending its rights under or in respect of this Agreement or any other Program Agreement, (ii) collecting the Purchase Price outstanding, (iii) foreclosing or otherwise collecting upon any Repurchase Assets and (iv) obtaining any legal, accounting or other advice in connection with any of the foregoing.

Section 10.03    Nonliability of Buyer.  The parties hereto agree that, notwithstanding any affiliation that may exist between Seller and Buyer, the relationship between Seller and Buyer shall be solely that of arms-length participants.  Buyer shall not have any fiduciary responsibilities to Seller.  Seller (i) agrees that Buyer shall not have any liability to Seller (whether sounding in tort, contract or otherwise) for losses suffered by Seller in connection with, arising out of, or in any way related to, the transactions contemplated and the relationship established by this agreement, the other loan documents or any other agreement entered into in connection herewith or any act, omission or event occurring in connection therewith, unless it is determined by a judgment of a court that is binding on Buyer (which judgment shall be final and not subject to review on appeal), that such losses were the result of acts or omissions on the part of Buyer constituting gross negligence or willful misconduct and (ii) waives, releases and agrees not to sue upon any claim against Buyer (whether sounding in tort, contract or otherwise), except a claim based upon gross negligence or willful misconduct.  Whether or not such damages are related to a claim that is subject to such waiver and whether or not such waiver is effective, Buyer shall not have any liability with respect to, and Seller hereby waives, releases and agrees not to sue upon any claim for, any special, indirect, consequential or punitive damages suffered by Seller in connection with, arising out of, or in any way related to the transactions contemplated or the relationship established by this Agreement, the other loan documents or any other agreement entered into in connection herewith or therewith or any act, omission or event occurring in connection herewith or therewith, unless it is determined by a judgment of a court that is binding on Buyer (which judgment shall be final and not subject to review on appeal), that such damages were the result of acts or omissions on the part of Buyer, as applicable, constituting willful misconduct or gross negligence.

Section 10.04     Governing Law; Submission to Jurisdiction; Waivers.

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(a)        This Agreement shall be binding and inure to the benefit of the parties hereto and their respective successors and permitted assigns.  Seller acknowledges that the obligations of Buyer hereunder or otherwise are not the subject of any VFN Guaranty by, or recourse to, any direct or indirect parent or other Affiliate of Buyer.  THIS AGREEMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO OR IN CONNECTION WITH THIS AGREEMENT, THE RELATIONSHIP OF THE PARTIES HERETO, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES HERETO WILL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO THE CONFLICT OF LAW PRINCIPLES THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

(b)        EACH OF THE PARTIES HERETO AND THE BUYER, BY THEIR ACCEPTANCE OF THE NOTE, HEREBY IRREVOCABLY AND UNCONDITIONALLY:

(i)         SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;

(ii)       CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;

(iii)      AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH HEREIN OR AT SUCH OTHER ADDRESS OF WHICH EACH OTHER PARTY HERETO SHALL HAVE BEEN NOTIFIED IN WRITING;

(iv)       AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION; AND

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(v)        WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THE INDENTURE OR THE TRANSACTIONS CONTEMPLATED THEREBY AND HEREBY.

Section 10.05     Notices.  Any and all notices (with the exception of Transaction Notices, which shall be delivered via facsimile only), statements, demands or other communications hereunder may be given by a party to the other by mail, email, facsimile, messenger or otherwise to the address specified below, or so sent to such party at any other place specified in a notice of change of address hereafter received by the other.  All notices, demands and requests hereunder may be made orally, to be confirmed promptly in writing, or by other communication as specified in the preceding sentence.

If to Seller:

PennyMac Loan Services, LLC

3043 Townsgate Road

Westlake Village, CA 91361

Attention:  Pamela Marsh/Richard Hetzel

Phone Number:  (805) 330-6059/ (805)  254-6088

E-mail:  [email protected];

[email protected];

[email protected]

 

with a copy to:

 

PennyMac Loan Services, LLC

3043 Townsgate Road

Westlake Village, CA 91361

Attention:  Derek Stark

Phone Number:  (818) 746-2289

E-mail:  [email protected]

 

If to Buyer:

 

For Transaction Notice:

 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH

c/o Credit Suisse Securities (USA) LLC

One Madison Avenue, 2nd floor

New York, NY  10010

Attention:  Christopher Bergs, Resi Mortgage Warehouse Ops

Phone:  212‑538‑5087

E-mail:  [email protected]‑suisse.com

 

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with a copy to:

 

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC

c/o Credit Suisse Securities (USA) LLC

Eleven Madison Avenue, 4th Floor

New York, NY  10010

Attention:  Margaret Dellafera

Phone Number:  212-325-6471

Fax Number:  212-743-4810

E-mail:  [email protected]

 

For all other Notices:

 

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC

c/o Credit Suisse Securities (USA) LLC

Eleven Madison Avenue, 4th Floor

New York, NY 10010

Attention:  Margaret Dellafera

Phone Number:  212-325-6471

Fax Number:  212-743-4810

E-mail:  [email protected]

 

Section 10.06     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.  In case any provision in or obligation under this Agreement or any other Program Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

Section 10.07    Section Headings.  The Article and Section headings in this Agreement are inserted for convenience of reference only and shall not in any way affect the meaning or construction of any provision of this Agreement.

Section 10.08     Counterparts.  This Agreement may be executed in any number of counterparts and by the different parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  Delivery of an executed counterpart of a signature page to this Agreement by facsimile or other electronic means shall be effective as delivery of a manually executed counterpart of this Agreement.

Section 10.09     Periodic Due Diligence Review.  Seller acknowledges that Buyer has the right to perform continuing due diligence reviews with respect to Seller and the Purchased Assets, for purposes of verifying compliance with the representations, warranties and specifications made hereunder, or otherwise, and Seller agree that upon reasonable (but no less than five (5) Business Days’) prior written notice unless an Event of Default shall have occurred, in which case no notice is required, to Seller, Buyer or its authorized representatives will be

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permitted during normal business hours, and in a manner that does not unreasonably interfere with the ordinary conduct of Seller’s business, to examine, inspect, and make copies and extracts of, any and all documents, records, agreements, instruments or information relating to such Purchased Assets in the possession or under the control of Seller.  Seller also shall make available to Buyer a knowledgeable financial or accounting officer for the purpose of answering questions respecting the Purchased Assets.  Without limiting the generality of the foregoing, Seller acknowledges that Buyer may enter into a Transaction related to any Purchased Assets from Seller based solely upon the information provided by Seller to Buyer in the Asset Schedule and the representations, warranties and covenants contained herein, and that Buyer, at its option, has the right at any time to conduct a partial or complete due diligence review on some or all of the Purchased Assets related to a Transaction.  Seller agrees to cooperate with Buyer and any third party underwriter in connection with such underwriting, including, but not limited to, providing Buyer and any third party underwriter with access to any and all documents, records, agreements, instruments or information relating to such Purchased Assets in the possession, or under the control, of Seller.

Section 10.10    Hypothecation or Pledge of Repurchase Assets.  Buyer shall have free and unrestricted use of all Repurchase Assets and nothing in this Agreement shall preclude Buyer from engaging in repurchase transactions with all or a portion of the Repurchase Assets or otherwise pledging, repledging, transferring, hypothecating, or rehypothecating all or a portion of the Repurchase Assets; provided that prior to an Event of Default, such pledge, repledge, transfer, hypothecation or rehypothecation is treated as a financing or hedging transaction for U.S. federal income tax purposes or a pro rata interest in all payments due to Buyer under this Agreement; provided, further that other than with respect to a pro rata interest in all payments due to Buyer under this Agreement and prior to an Event of Default Buyer receives an opinion of a nationally recognized tax counsel experienced in such matters that such repurchase transaction, pledge, repledge, transfer, hypothecation or rehypothecation will not result in the Issuer being subject to tax on its net income as an association (or publicly traded partnership) taxable as a corporation or a taxable mortgage pool taxable as a corporation, each for U.S. federal income tax purposes.

Section 10.11     Non-Confidentiality of Tax Treatment.

(a)        This Agreement and its terms, provisions, supplements and amendments, and notices hereunder, are proprietary to Buyer or Seller, as applicable and shall be held by each party hereto, as applicable in strict confidence and shall not be disclosed to any third party without the written consent of Buyer or Seller, except for (i) disclosure to Buyer’s or Seller’s direct and indirect Affiliates and Subsidiaries, attorneys or accountants, but only to the extent such disclosure is necessary and such parties agree to hold all information in strict confidence, or (ii) disclosure required by law, rule, regulation or order of a court or other regulatory body.  Notwithstanding the foregoing or anything to the contrary contained herein or in any other Program Agreements, the parties hereto may disclose to any and all Persons, without limitation of any kind, the federal, state and local tax treatment of the Transactions, any fact relevant to understanding the federal, state and local tax treatment of the Transactions, and all materials of any kind (including opinions or other tax analyses) relating to such federal, state and local tax treatment and that may be relevant to understanding such tax treatment; provided that Seller may not disclose the name of or identifying information with respect to Buyer or any pricing terms (including, without limitation, the Pricing Rate, Purchase Price Percentage, Purchase Price and Commitment Fee) or other nonpublic business or financial information (including any sublimits) that is unrelated to the

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federal, state and local tax treatment of the Transactions and is not relevant to understanding the federal, state and local tax treatment of the Transactions, without the prior written consent of Buyer.

(b)        Notwithstanding anything in this Agreement to the contrary, Seller shall comply with all applicable local, state and federal laws, including, without limitation, all privacy and data protection law, rules and regulations that are applicable to the Repurchase Assets and/or any applicable terms of this Agreement (the “Confidential Information”).  Seller understands that the Confidential Information may contain “nonpublic personal information”, as that term is defined in Section 509(4) of the Gramm-Leach-Bliley Act (the “GLB Act”), and Seller agrees to maintain such nonpublic personal information that it receives hereunder in accordance with the GLB Act and other applicable federal and state privacy laws.  Seller shall implement such physical and other security measures as shall be necessary to (a) ensure the security and confidentiality of the “nonpublic personal information” of the “customers” and “consumers” (as those terms are defined in the GLB Act) of Buyer or any Affiliate of Buyer which Seller holds, (b) protect against any threats or hazards to the security and integrity of such nonpublic personal information, and (c) protect against any unauthorized access to or use of such nonpublic personal information.  Seller represents and warrants that it has implemented appropriate measures to meet the objectives of Section 501(b) of the GLB Act and of the applicable standards adopted pursuant thereto, as now or hereafter in effect.  Upon request, Seller will provide evidence reasonably satisfactory to allow Buyer to confirm that the providing party has satisfied its obligations as required under this Section 10.11.  Without limitation, this may include Buyer’s review of audits, summaries of test results, and other equivalent evaluations of Seller.  Seller shall notify Buyer immediately following discovery of any breach or compromise of the security, confidentiality, or integrity of nonpublic personal information of the customers and consumers of Buyer or any Affiliate of Buyer provided directly to Seller by Buyer or such Affiliate.  Seller shall provide such notice to Buyer by personal delivery, by facsimile with confirmation of receipt, or by overnight courier with confirmation of receipt to the applicable requesting individual.

Section 10.12     Set-off.  In addition to any rights and remedies of Buyer hereunder and by law, Buyer shall have the right, without prior notice to Seller, any such notice being expressly waived by Seller to the extent permitted by applicable law to set-off and appropriate and apply against any Obligation from Seller or any Affiliate thereof to Buyer or any of its Affiliates any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other obligation (including to return funds to Seller), credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by or due from Buyer or any Affiliate thereof to or for the credit or the account of Seller or any Affiliate thereof.  Buyer agrees promptly to notify Seller after any such set off and application made by Buyer; provided that the failure to give such notice shall not affect the validity of such set off and application.

Section 10.13     Intent.

(a)        The parties recognize that each Transaction is a “master netting agreement” as that term is defined in Section 101 of Title 11 of the United States Code, as amended and a “securities contract” as that term is defined in Section 741 of Title 11 of the United States Code,

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as amended and that all payments hereunder are deemed “margin payments” or “settlement payments” as defined in Title 11 of the United States Code.

(b)        It is understood that either party’s right to liquidate Purchased Assets delivered to it in connection with Transactions hereunder or to exercise any other remedies pursuant to Section 7.03 hereof is a contractual right to liquidate such Transaction as described in Sections 555 and Section 561 of Title 11 of the United States Code, as amended.

(c)        The parties agree and acknowledge that if a party hereto is an “insured depository institution,” as such term is defined in the Federal Deposit Insurance Act, as amended (“FDIA”), then each Transaction hereunder is a “qualified financial contract,” as that term is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as the type of assets subject to such Transaction would render such definition inapplicable).

(d)        It is understood that this Agreement constitutes a “netting contract” as defined in and subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and each payment entitlement and payment obligation under any Transaction hereunder shall constitute a “covered contractual payment entitlement” or “covered contractual payment obligation”, respectively, as defined in and subject to FDICIA (except insofar as one or both of the parties is not a “financial institution” as that term is defined in FDICIA).

(e)        This Agreement is intended to be a “securities contract,” within the meaning of Section 555 under the Bankruptcy Code, and a “master netting agreement,” within the meaning of Section 561 under the Bankruptcy Code.

(f)        It is the intention of the parties that, for U.S. federal income tax purposes and for accounting purposes, each Transaction constitute a financing, and that Seller be (except to the extent that Buyer shall have exercised its remedies following an Event of Default) the owner of the Purchased Assets for such purposes.  Unless prohibited by applicable law, Seller and Buyer shall treat the Transactions as described in the preceding sentence (including on any and all filings with any U.S. federal, state, or local taxing authority and agree not to take any action inconsistent with such treatment).

 

 

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IN WITNESS WHEREOF, Seller and Buyer have caused this Master Repurchase Agreement to be executed and delivered by their duly authorized officers or trustees as of the date first above written.

 

CREDIT SUISSE AG, CAYMAN ISLANDS
BRANCH
, as Buyer

 

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Authorized Signatory

 

 

 

By:

/s/ Margaret D. Dellafera

 

 

Name:

Margaret D. Dellafera

 

 

Title:

Authorized Signer

 

[Signature Page to SPIADVF1 Master Repurchase Agreement]

 

 

 

 

 

 

 

CREDIT SUISSE FIRST BOSTON MORTGAGE
CAPITAL LLC
, as Administrative Agent

 

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Vice President

 

[Signature Page to SPIADVF1 Master Repurchase Agreement]

 

 

 

PENNYMAC LOAN SERVICES, LLC,
as Seller

 

 

 

 

 

By:

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Senior Managing Director and Treasurer

 

 

 

[Signature Page to SPIADVF1 Master Repurchase Agreement]

 

 

SCHEDULE 1

 

RESPONSIBLE OFFICERS – SELLER

SELLER AUTHORIZATIONS

 

 

Schedule 1-1

 

 

SCHEDULE 2

 

ASSET SCHEDULE

 

 

Schedule 2-1

 

 

SCHEDULE 3

BUYER ACCOUNT

 

 

Schedule 3-1

 

 

EXHIBIT A

FORM OF TRANSACTION NOTICE

Purchase Date:  [_________]

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH

c/o Credit Suisse Securities (USA) LLC

Eleven Madison Avenue

New York, NY 10010

Attention:  Dominic Obaditch

Email:  [email protected]-suisse.com

 

TRANSACTION NOTICE

Ladies and Gentlemen:

We refer to the Master Repurchase Agreement, dated as of March [__], 2020 (the “Agreement”), among PennyMac Loan Services, LLC (the “Seller”), Credit Suisse AG, Cayman Islands Branch (the “Buyer”) and Credit Suisse First Boston Mortgage Capital LLC (the “Administrative Agent”).  Each capitalized term used but not defined herein shall have the meaning specified in the Agreement.  This notice is being delivered by Seller pursuant to Section 2.02 of the Agreement.

Please be notified that Seller hereby irrevocably requests that the Buyer enter into the following Transaction(s) with the Seller as follows:

 

 

 

 

 

 

P&I

Escrow

Corp

Total

Beginning Receivables Balance

$0.00

$0.00

$0.00

$0.00

Ineligible Corporate Advances (Currents>25%)

 

 

$0.00

$0.00

Advance Reimbursement Amounts

$0.00

$0.00

$0.00

$0.00

Additional Receivables

$0.00

$0.00

$0.00

$0.00

Ending Receivables Balance

$0.00

$0.00

$0.00

$0.00

WA Advance Rates

%

%

%

 

Total WA Advance Rate

 

 

 

%

Initial Note Balance/Purchase Price requested
(i.e. Ending VFN Balance)

 

 

 

$0.00

Purchase Price Percentage

 

 

 

%

Additional Balance/Purchase Price requested
(i.e. New Purchase Price)

 

 

 

$0.00

Current Purchase Price

 

 

 

$0.00

Purchase Price Change

 

 

 

$0.00

Effective Advance Rate

 

 

 

%

 

Exhibit A-1

 

 

Seller requests that the proceeds of the Purchase Price be deposited in Seller’s account at _______, ABA Number _______, account number ____, References:  _____, Attn:  _______.

Seller hereby represents and warrants that each of the representations and warranties made by Seller in each of the Program Agreements to which it is a party is true and correct in all material respects, in each case, on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date.  Attached hereto is a true and complete updated copy of the Asset Schedule.

 

Exhibit A-2

 

 

 

 

 

 

PENNYMAC LOAN SERVICES, LLC, as Seller

 

 

 

 

 

By:

 

 

Exhibit A-3

 

 

Asset Schedule

 

 

Note

Initial Note
Balance

Additional
Balance(s)

Outstanding
VFN Principal
Balance

 

Maximum VFN
Principal
Balance 

PNMAC GMSR ISSUER TRUST, SPIADVF1 Variable Funding Note

$[________]

$[________]

$[________]

$[________]

 

 

 

Exhibit A-4

 

 

EXHIBIT B

EXISTING INDEBTEDNESS

[See Attached]

 

 

Exhibit B-1

(Back To Top)

Section 3: EX-10.2 (EX-10.2)

10.2 GMSR A_R Guaranty

 

Exhibit 10.2

 

EXECUTION VERSION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AMENDED AND RESTATED GUARANTY

 

 

by

 

 

 

PRIVATE NATIONAL MORTGAGE

ACCEPTANCE COMPANY, LLC, as guarantor

 

 

 

Dated as of April 1, 2020

 

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

 

 

 

 

 

 

Page

 

 

 

1.

Defined Terms

2

2.

Guaranty

2

3.

Right of Set-off

3

4.

Subrogation

3

5.

Amendments, etc. with Respect to the Obligations

3

6.

Guaranty Absolute and Unconditional

4

7.

Reinstatement

5

8.

Payments

5

9.

Event of Default

5

10.

Severability

6

11.

Headings

6

12.

No Waiver; Cumulative Remedies

6

13.

Waivers and Amendments; Successors and Assigns; Governing Law

6

14.

Notices

6

15.

Jurisdiction

6

16.

Integration

7

17.

Acknowledgments

7

 

 

 

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AMENDED AND RESTATED GUARANTY

This AMENDED AND RESTATED GUARANTY, dated as of April 1, 2020 (as may be amended, restated, supplemented or otherwise modified from time to time, this “Guaranty”) amends and restates that certain guaranty, dated as of December 19, 2016 (the “Original Guaranty”), and is made by Private National Mortgage Acceptance Company, LLC, a Delaware limited liability company (“Guarantor”), in favor of Credit Suisse First Boston Mortgage Capital LLC (the “Administrative Agent”) on behalf of Credit Suisse AG, Cayman Islands Branch (the “Buyer”).

RECITALS

WHEREAS, pursuant to the Master Repurchase Agreement, dated as of December 19, 2016 (as Amended by Amendment No. 1, dated as of February 28, 2018 and Amendment No. 2, dated as of the date hereof, and as may be further amended, restated, supplemented or otherwise modified from time to time, the “MSRVF1 Repurchase Agreement”), among PennyMac Loan Services, LLC (the “Seller”),   Buyer and Credit Suisse First Boston Mortgage Capital LLC, as administrative agent (the “Administrative Agent”), Buyer has agreed from time to time to enter into Transactions with Seller;

WHEREAS, pursuant to the Third Amended and Restated Base Indenture, dated as of April 1, 2020, among PNMAC GMSR ISSUER TRUST, as issuer (the “Issuer”), the Seller, as servicer and as administrator, Citibank, N.A., as indenture trustee (in such capacity, the “Indenture Trustee”), calculation agent, paying agent and securities intermediary, Administrative Agent, and Pentalpha Surveillance LLC, as credit manager (together with all schedules and exhibits thereto, as may be amended, restated, supplemented or otherwise modified from time to time, the “Base Indenture,”) as supplemented by the Series 2020-SPIADVF1 Indenture Supplement, dated as of April 1, 2020, by and among the Issuer, the Indenture Trustee, the Seller and the Administrative Agent (collectively with each other supplement to the Base Indenture executed and delivered in conjunction with the issuance of the related Series of Notes, including the schedules and exhibits thereto, the “Indenture”). The Issuer has issued and delivered the Series 2020-SPIADVF1 Variable Funding Notes (the “SPIADVF1 Notes”) to the Seller;

WHEREAS, pursuant to the Master Repurchase Agreement, dated as of April 1, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the “SPIADVF1 Repurchase Agreement”), among Seller, Buyer and Administrative Agent, Buyer has agreed from time to time to enter into Transactions with Seller with respect to the SPIADVF1 Notes;

WHEREAS, as a condition precedent to entering into the MSRVF1 Repurchase Agreement, the Guarantor executed and delivered the Original Guaranty;

WHEREAS, as a condition precedent to entering into the SPIADVF1 Repurchase Agreement, the Guarantor is required to execute and deliver this Guaranty;

WHEREAS, the Guarantor will receive a benefit, either directly or indirectly from the Seller for entering into this Guaranty; and

 

 

 

 

NOW, THEREFORE, in consideration of the foregoing premises, to induce Buyer to enter into Transactions under the MSRVF1 Repurchase Agreement and to enter into the SPIADVF1 Repurchase Agreement and to enter into Transactions thereunder, Guarantor hereby agrees with Buyer, as follows:

1.         Defined Terms.  (a) Unless otherwise defined herein, terms which are defined in the MSRVF1 Repurchase Agreement or the SPIADVF1 Repurchase Agreement and used herein are so used as so defined.

(b)        For purposes of this Guaranty, “Obligations” shall mean all obligations and liabilities of Seller to Buyer, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, or out of or in connection with the MSRVF1 Repurchase Agreement or the SPIADVF1 Repurchase Agreement, as applicable, and any other Program Agreements and any other document made, delivered or given in connection therewith or herewith, whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including, without limitation, all fees and disbursements of counsel to Buyer that are required to be paid by Seller pursuant to the terms of the Program Agreements and costs of enforcement of this Guaranty reasonably incurred) or otherwise.

2.         Guaranty.  (a) Guarantor hereby unconditionally and irrevocably guarantees to Buyer the prompt and complete payment and performance by Seller when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations.

(b)        Guarantor further agrees to pay any and all expenses (including, without limitation, all fees and disbursements of counsel) which may be paid or incurred by Buyer in enforcing, or obtaining advice of counsel in respect of, any rights with respect to, or collecting, any or all of the Obligations and/or enforcing any rights with respect to, or collecting against, Guarantor under this Guaranty.  This Guaranty shall remain in full force and effect until the latest of (i) the termination of the MSRVF1 Repurchase Agreement, (ii) the termination of the SPIADVF1 Repurchase Agreement and (iii) the Obligations are paid in full, notwithstanding that from time to time prior thereto Seller may be free from any Obligations.

(c)        No payment or payments made by Seller or any other Person or received or collected by Buyer from Seller or any other Person by virtue of any action or proceeding or any set-off or appropriation or application, at any time or from time to time, in reduction of or in payment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of Guarantor hereunder which shall, notwithstanding any such payment or payments, remain liable for the amount of the outstanding Obligations until the outstanding Obligations are paid in full.

(d)        Guarantor agrees that whenever, at any time, or from time to time, Guarantor shall make any payment to Buyer on account of Guarantor’s liability hereunder, Guarantor will notify Buyer in writing that such payment is made under this Guaranty for such purpose.

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3.         Right of Set-off.  Buyer is hereby irrevocably authorized at any time and from time to time without notice to Guarantor, any such notice being hereby waived by Guarantor, to set-off and appropriate and apply any and all monies and other property of Guarantor, deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by Buyer of any Affiliate thereof to or for the credit or the account of Guarantor, or any part thereof in such amounts as Buyer may elect, on account of the Obligations and liabilities of Guarantor hereunder and claims of every nature and description of Buyer against Guarantor, in any currency, whether arising hereunder, under the MSRVF1 Repurchase Agreement, under the SPIADVF1 Repurchase Agreement or otherwise, as Buyer may elect, whether or not Buyer has made any demand for payment and although such Obligations and liabilities and claims may be contingent or unmatured.  Buyer shall notify Guarantor promptly of any such set-off and the application made by Buyer, provided that the failure to give such notice shall not affect the validity of such set-off and application.  The rights of Buyer under this paragraph are in addition to other rights and remedies (including, without limitation, other rights of set-off) which Buyer may have.

4.         Subrogation.  Notwithstanding any payment or payments made by Guarantor hereunder or any set-off or application of funds of Guarantor by Buyer, Guarantor shall not be entitled to be subrogated to any of the rights of Buyer against Seller or any other guarantor or any collateral security or guarantee or right of offset held by Buyer for the payment of the Obligations, nor shall Guarantor seek or be entitled to seek any contribution or reimbursement from Seller or any other guarantor in respect of payments made by Guarantor hereunder, until all amounts owing to Buyer by Seller on account of the Obligations are paid in full and both the MSRVF1 Repurchase Agreement and the SPIADVF1 Repurchase Agreement are terminated.  If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amounts shall be held by Guarantor for the benefit of Buyer, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Buyer in the exact form received by Guarantor (duly indorsed by Guarantor to Buyer, if required), to be applied against the Obligations, whether matured or unmatured, in such order as Buyer may determine.

5.         Amendments, etc. with Respect to the Obligations.  Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against Guarantor, and without notice to or further assent by Guarantor, any demand for payment of any of the Obligations made by Buyer may be rescinded by Buyer, and any of the Obligations continued, and the Obligations, or the liability of any other party upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by Buyer, and the MSRVF1 Repurchase Agreement, the SPIADVF1 Repurchase Agreement and the other Program Agreements and any other document in connection therewith may be amended, modified, supplemented or terminated, in whole or in part, pursuant to its terms and as Buyer may deem advisable from time to time, and any collateral security, guarantee or right of offset at any time held by Buyer for the payment of the Obligations may be sold, exchanged, waived, surrendered or released.  Buyer shall have no obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for this Guaranty or any property subject thereto.  When making any demand hereunder against Guarantor, Buyer may, but shall be

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under no obligation to, make a similar demand on Seller and any failure by Buyer to make any such demand or to collect any payments from Seller or any release of Seller shall not relieve Guarantor of its obligations or liabilities hereunder, and shall not impair or affect the rights and remedies, express or implied, or as a matter of law, of Buyer against Guarantor.  For the purposes hereof “demand” shall include, but is not limited to, the commencement and continuance of any legal proceedings.

6.         Guaranty Absolute and Unconditional.  (a) Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance by Buyer upon this Guaranty or acceptance of this Guaranty; the Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived in reliance upon this Guaranty; and all dealings between Seller or Guarantor, on the one hand, and Buyer, on the other, shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guaranty.  Guarantor waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon Seller or the Guaranty with respect to the Obligations.  This Guaranty shall be construed as a continuing, absolute and unconditional guarantee of payment without regard to (i) the validity or enforceability of the MSRVF1 Repurchase Agreement, the SPIADVF1 Repurchase Agreement, the other Program Agreements, any of the Obligations or any collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by Buyer, (ii) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by Seller against Buyer, or (iii) any other circumstance whatsoever (with or without notice to or knowledge of Seller or Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of Seller for the Obligations, or of Guarantor under this Guaranty, in bankruptcy or in any other instance.  When pursuing its rights and remedies hereunder against Guarantor, Buyer may, but shall be under no obligation, to pursue such rights and remedies that they may have against Seller or any other Person or against any collateral security or guarantee for the Obligations or any right of offset with respect thereto, and any failure by Buyer to pursue such other rights or remedies or to collect any payments from Seller or any such other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of Seller or any such other Person or any such collateral security, guarantee or right of offset, shall not relieve Guarantor of any liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of Buyer against Guarantor.  This Guaranty shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon Guarantor and their successors and assigns thereof, and shall inure to the benefit of Buyer, and successors, indorsees, transferees and assigns, until all the Obligations and the obligations of Guarantor under this Guaranty shall have been satisfied by payment in full, notwithstanding that from time to time during the term of the MSRVF1 Repurchase Agreement or the SPIADVF1 Repurchase Agreement Seller may be free from any Obligations.

(b)        Without limiting the generality of the foregoing, Guarantor hereby agrees, acknowledges, and represents and warrants to Buyer as follows:

(i)       Guarantor hereby waives any defense arising by reason of, and any and all right to assert against Buyer any claim or defense based upon, an election of remedies by Buyer which in any manner impairs, affects, reduces,

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releases, destroys and/or extinguishes Guarantor’s (x) subrogation rights, (y) rights to proceed against Seller or any other guarantor for reimbursement or contribution, and/or (z) any other rights of Guarantor to proceed against Seller, against any other guarantor, or against any other person or security.

(ii)      Guarantor is presently informed of the financial condition of Seller and of all other circumstances which diligent inquiry would reveal and which bear upon the risk of nonpayment of the ObligationsGuarantor hereby covenants that it will make its own investigation and will continue to keep itself informed of Seller’s financial condition, the status of other guarantors, if any, of all other circumstances which bear upon the risk of nonpayment and that it will continue to rely upon sources other than Buyer for such information and will not rely upon Buyer for any such informationAbsent a written request for such information by Guarantor to Buyer, Guarantor hereby waives its right, if any, to require Buyer to disclose to Guarantor any information which Buyer may now or hereafter acquire concerning such condition or circumstances including, but not limited to, the release of or revocation by any other guarantor.

(iii)     Guarantor has independently reviewed the MSRVF1 Repurchase Agreement, the SPIADVF1 Repurchase Agreement and related agreements and has made an independent determination as to the validity and enforceability thereof, and in executing and delivering this Guaranty to Buyer, Guarantor is not in any manner relying upon the validity, and/or enforceability, and/or attachment, and/or perfection of any Liens or security interests of any kind or nature granted by Seller or any other guarantor to Buyer, now or at any time and from time to time in the future.

7.         ReinstatementThis Guaranty shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored or returned by Buyer upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Seller or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Seller or any substantial part of its property, or otherwise, all as though such payments had not been made.

8.         PaymentsGuarantor hereby agrees that the Obligations will be paid to Buyer without set-off or counterclaim in U.S. Dollars.

9.         Event of DefaultIf an Event of Default under the MSRVF1 Repurchase Agreement or the SPIADVF1 Repurchase Agreement shall have occurred and be continuing, Guarantor agrees that, as between Guarantor and the Buyer, the Obligations may be declared to be due in accordance with the terms of the MSRVF1 Repurchase Agreement or the SPIADVF1 Repurchase Agreement, as applicable, for purposes of this Guaranty notwithstanding any stay, injunction or other prohibition which may prevent, delay or vitiate any such declaration as against the Seller and that, in the event of any such declaration (or attempted declaration), such Obligations shall forthwith become due by Guarantor for purposes of this Guaranty.

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10.       SeverabilityAny provision of this Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

11.       HeadingsThe paragraph headings used in this Guaranty are for convenience of reference only and are not to affect the construction hereof or be taken into consideration in the interpretation hereof.

12.       No Waiver; Cumulative RemediesBuyer shall not by any act (except by a written instrument pursuant to Section 13 hereof), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default or in any breach of any of the terms and conditions hereofNo failure to exercise, nor any delay in exercising, on the part of Buyer, any right, power or privilege hereunder shall operate as a waiver thereofNo single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilegeA waiver by Buyer of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which Buyer would otherwise have on any future occasionThe rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any rights or remedies provided by law.

13.       Waivers and Amendments; Successors and Assigns; Governing Law.  None of the terms or provisions of this Guaranty may be waived, amended, supplemented or otherwise modified except by a written instrument executed by Guarantor and Buyer, provided that any provision of this Guaranty may be waived by Buyer in a letter or agreement executed by Buyer or by facsimile or electronic transmission from Buyer to the Guarantor.  This Guaranty shall be binding upon the personal representatives, successors and assigns of Guarantor and shall inure to the benefit of Buyer and its successors and assigns.

14.       Notices.  Notices delivered in connection with this Guaranty shall be given in accordance with Section 10.05 of the MSRVF1 Repurchase Agreement or Section 10.05 of the SPIADVF1 Repurchase Agreement, as applicable.

15.       Governing Law; Jurisdiction; Waivers.

(a)        THIS GUARANTY AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO OR IN CONNECTION WITH THIS GUARANTY, THE RELATIONSHIP OF THE PARTIES HERETO, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES HERETO WILL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO THE CONFLICT OF LAW PRINCIPLES THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

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(b)        THE GUARANTOR SUBMITS ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS GUARANTY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF MANHATTAN, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;

(c)        THE GUARANTOR CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;

(d)        THE GUARANTOR AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS SET FORTH HEREIN OR AT SUCH OTHER ADDRESS OF WHICH EACH OTHER PARTY HERETO SHALL HAVE BEEN NOTIFIED IN WRITING, EXCEPT THAT WITH RESPECT TO THE INDENTURE TRUSTEE, CALCULATION AGENT, PAYING AGENT AND SECURITIES INTERMEDIARY, SERVICE OF PROCESS MAY ONLY BE MADE AS REQUIRED BY APPLICABLE LAW;

(e)        THE GUARANTOR AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION; AND

(f)        THE GUARANTOR WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY.

16.       Integration.  This Guaranty represents the agreement of Guarantor with respect to the subject matter hereof and there are no promises or representations by Buyer relative to the subject matter hereof not reflected herein.  This Guaranty may be executed in any number of counterparts, each of which so executed will be deemed to be an original, but all such counterparts will together constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this Guaranty by facsimile or other electronic means shall be effective as delivery of a manually executed counterpart of this Guaranty.

17.       Third Party Beneficiaries.  Each of the Secured Parties and the Administrative Agent shall be a third party beneficiary of this Guaranty and shall be entitled to enforce the Guarantor’s Obligations hereunder to the same extent as if it was a signatory hereto.

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18.       Acknowledgments.  Guarantor hereby acknowledges that:

(a)        Guarantor has been advised by counsel in the negotiation, execution and delivery of this Guaranty and the other Program Agreements;

(b)        Buyer does not have any fiduciary relationship to Guarantor, Guarantor does not have any fiduciary relationship to Buyer and the relationship between Buyer and Guarantor is solely that of surety and creditor;

(c)        no joint venture exists between Buyer and Guarantor or among Buyer, Seller and Guarantor;

(d)        this Guaranty is “a security agreement or arrangement or other credit enhancement” that is “related to” and provided “in connection with” the PC Repurchase Agreement and each Transaction thereunder and is within the meaning of Sections 101(38A)(A) and 741(7)(A)(xi) of the Bankruptcy Reform Act of 1978, 11 U.S.C. §§ 101 et seq., as amended (the “Bankruptcy Code”) and is, therefore to the extent of damages in connection with the PC Repurchase Agreement, measured in accordance with Section 562 of the Bankruptcy Code (i) a “securities contract” as that term is defined in Section 741(7)(A)(xi) of the Bankruptcy Code and (ii) a “master netting agreement” as that term is defined in Section 101(38A) of the Bankruptcy Code; and

(e)        Buyer’s right to cause the termination, liquidation or acceleration of, or to offset or net termination values, payment amounts or other transfer obligations arising under or in connection with the MSRVF1 Repurchase Agreement, the SPIADVF1 Repurchase Agreement and this Guaranty is in each case a contractual right to cause the termination, liquidation or acceleration of, or to offset or net termination values, payment amounts or other transfer obligations arising under or in connection with this Guaranty as described in Sections 362(b)(6), 362(b)(27), 555 and/or 561 of the Bankruptcy Code.

19.       Amendment and Restatement.  The terms and provisions of the Original Guaranty are hereby amended and restated in their entirety by the terms and provisions of this Guaranty and shall supersede all provisions of the Original Guaranty as of the date hereof.  From and after the date hereof, all references made to the Original Guaranty in any Program Agreement or in any other instrument or document shall, without more, be deemed to refer to this Guaranty.

[Signature page follows]

 

 

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IN WITNESS WHEREOF, the undersigned has caused this Amended and Restated Guaranty to be duly executed and delivered as of the date first above written.

 

 

 

 

 

 

PRIVATE NATIONAL MORTGAGE ACCEPTANCE COMPANY, LLC, as Guarantor

 

 

 

 

By:

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Senior Managing Director and Treasurer

 

[Signature Page to A&R Guaranty (MSRVF1 MRA & SPIADVF1 MRA)]

 

 

 

 

 

 

 

CONSENTED TO BY:

 

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC, as Administrative Agent

 

 

 

 

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Vice President

 

 

 

 

 

 

 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Buyer

 

 

 

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Authorized Signatory

 

 

 

 

 

 

 

 

 

By:

/s/ Margaret D. Dellafera

 

 

Name:

Margaret D. Dellafera

 

 

Title:

Authorized Signer

 

[Signature Page to A&R Guaranty (MSRVF1 MRA & SPIADVF1 MRA)]

(Back To Top)

Section 4: EX-10.3 (EX-10.3)

10.3 Am 9 to A_R MRA

 

Exhibit 10.3

 

 

 

PLS REGULAR FACILITY

EXECUTION VERSION

 

AMENDMENT NO. 9  TO

THIRD AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT

 

Amendment No. 9 to Third Amended and Restated Master Repurchase Agreement, dated as of April 1, 2020 (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 Loan Services, LLC (the “Seller”) and Private National Mortgage Acceptance Company, LLC  (the  “Guarantor”).

RECITALS

The Administrative Agent,  the Buyers, the Seller and the Guarantor are parties to that certain Third Amended and Restated Master Repurchase Agreement, dated as of April 28, 2017 (as amended by Amendment No. 1, dated as of June 1, 2017, Amendment No. 2, dated as of December 20, 2017, Amendment No. 3, dated as of February 1, 2018, Amendment No. 4, dated as of April 27, 2018,  Amendment No. 5, dated as of February 11, 2019, Amendment No. 6, dated as of April 26, 2019, Amendment No. 7, dated as of September 11, 2019 and Amendment No. 8, dated as of March 6, 2020,  the “Existing Repurchase Agreement”, and as amended by this Amendment, the “Repurchase Agreement”) and the related Second Amended and Restated Pricing Side Letter, dated as of April 28, 2017 (as amended, restated, supplemented or otherwise modified from time to time, the “Pricing Side Letter”).  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 Administrative Agent.  Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Existing 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 has 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:

1.1       adding the following definitions in proper alphabetical order:

SPIA VFN Repo Agreement” means that certain Master Repurchase Agreement dated as of April 1, 2020 by and among Seller, Administrative Agent and CS Cayman, as amended, restated, supplemented or otherwise modified from time to time.

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SPIA VPN Repo Documents” means the SPIA VFN Repo Agreement and the other “Program Agreements” as defined in the SPIA VPN Repo Agreement.

1.2       deleting the definition of “Obligations” in its entirety and replacing it with the following:

Obligations” means (a) all of Seller’s indebtedness, obligations to pay the Repurchase Price on the Repurchase Date, the Price Differential on each Price Differential Payment Date, and other obligations and liabilities, to Administrative Agent and Buyers, its Affiliates or Custodian arising under, or in connection with, the Program Agreements, whether now existing or hereafter arising; (b) any and all sums paid by Administrative Agent, Buyers or Administrative Agent on behalf of Buyers in order to preserve any Purchased Mortgage Loan or its interest therein; (c) in the event of any proceeding for the collection or enforcement of any of Seller’s indebtedness, obligations or liabilities referred to in clause (a), the reasonable expenses of retaking, holding, collecting, preparing for sale, selling or otherwise disposing of or realizing on any Purchased Mortgage Loan, or of any exercise by Administrative Agent or Buyers of their rights under the Program Agreements, including, without limitation, attorneys’ fees and disbursements and court costs; (d) all of Seller’s indemnity obligations to Administrative Agent, Buyers and Custodian or both pursuant to the Program Agreements; (e) all of Seller’s obligations under the VFN Facility Documents; (f) all of Seller’s obligations under the Conventional MSR Loan Facility Documents; (g) all of Seller’s obligations under the MSR PC Repo Documents and (h) all of Seller’s obligations under the SPIA VPN Repo Documents.

SECTION 2.  Security Interest. Section 8 of the Existing Repurchase Agreement is hereby amended by deleting subsection c. thereof in its entirety and replacing it with the following:

c.          Administrative Agent and Seller hereby agree that in order to further secure Seller’s Obligations hereunder, Seller hereby grants to Administrative Agent, for the benefit of Buyers, a security interest in (i) Seller’s rights under the Conventional MSR Loan Facility Documents, SPIA VFN Repo Documents and the MSR PC Repo Documents, including, without limitation, any rights to receive payments thereunder or any rights to collateral thereunder whether now owned or hereafter acquired, now existing or hereafter created, and (ii) all collateral however defined or described under the Conventional MSR Loan Facility Documents, SPIA VFN Repo Documents and the MSR PC Repo Documents (the “Additional Collateral”). Seller hereby instructs Buyer, as lender under the Conventional MSR Loan Facility Documents, as the buyer under the SPIA VFN Repo Documents and the buyer under the MSR PC Repo Documents that upon receipt of a notice of an Event of Default under this Agreement, the Buyer, as the lender or buyer, as applicable, thereunder, is authorized and instructed to remit to Administrative Agent for the benefit of Buyers hereunder directly any amounts otherwise payable to Seller under the Conventional MSR Loan Facility Documents, the SPIA VFN Repo Documents and the MSR PC Repo Documents and to deliver to Administrative Agent for the benefit of Buyers all collateral otherwise deliverable to Seller. In furtherance of the foregoing, upon repayment of the entire “Obligations” (as defined in the Conventional MSR Loan Facility Documents) under the Conventional MSR Loan Agreement and the termination of all obligations of the lender thereunder or other termination of the Conventional MSR Loan Facility Documents following the repayment of all obligations thereunder that the lender thereunder deliver to Administrative Agent for the

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benefit of Buyers hereunder any collateral then in its possession or control. In furtherance of the foregoing, upon repayment of the entire “Obligations” (as defined in the MSR PC Repo Documents) under the MSR PC Repo Agreement and the termination of all obligations of the lender thereunder or other termination of the MSR PC Repo Documents following the repayment of all obligations thereunder that the lender thereunder deliver to Administrative Agent for the benefit of Buyers hereunder any collateral then in its possession or control.  In furtherance of the foregoing, upon repayment of the entire “Obligations” (as defined in the SPIA VFN Repo Documents) under the SPIA VFN Repo Agreement and the termination of all obligations of the lender thereunder or other termination of the SPIA VFN Repo Documents following the repayment of all obligations thereunder that the lender thereunder deliver to Administrative Agent for the benefit of Buyers hereunder any collateral then in its possession or control. The foregoing provision c. is intended to constitute a security agreement or other arrangement or other credit enhancement related to the Agreement and Transactions hereunder as defined under Sections 101(47)(v) and 741(7)(x) of the Bankruptcy Code.

SECTION 3.    Cross Default. Section 15 of the Existing Repurchase Agreement is hereby amended by deleting subsection b. thereof in its entirety and replacing it with the following:

b.         Cross Default.  Seller, Guarantor or Affiliates thereof shall be in default under (i) the VFN Facility Documents, (ii) the Conventional MSR Loan Facility Documents, (iii) the MSR PC Repo Documents, (iv) the SPIA VFN Repo Documents,  (v) any Indebtedness, in the aggregate, in excess of $1 million of Seller, Guarantor or any Affiliate thereof, including amounts owed under the VFN Facility Documents, SPIA VFN Repo Documents or the MSR PC Repo Documents, which default (1) involves the failure to pay a matured obligation, or (2) permits the acceleration of the maturity of obligations by any other party to or beneficiary with respect to such Indebtedness, or (vi) any other contract or contracts, in the aggregate in excess of $1 million to which Seller, Guarantor or any Affiliate thereof is a party which default (1) involves the failure to pay a matured obligation, or (2) permits the acceleration of the maturity of obligations by any other party to or beneficiary of such contract.

SECTION 4.   Conditions Precedent.  This Amendment shall become effective as of the date hereof (the “Amendment Effective Date”),  subject to the satisfaction of the following conditions precedent:

4.1       Delivered Documents.  On the Amendment Effective Date, the Administrative Agent on behalf of 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;  and

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

SECTION 5.   Representations and Warranties.  Seller hereby represents and warrants to the Administrative Agent and 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

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no Event of Default has occurred or is continuing, and hereby confirms and reaffirms the representations and warranties contained in Section 13 of Repurchase Agreement.

SECTION 6.    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 7.    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 8.    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 9.  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 10. 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 the Seller to Administrative Agent and Buyers under the Repurchase Agreement and related Program Agreements, as amended hereby.

 

[Remainder of page intentionally left blank]

 

 

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IN WITNESS WHEREOF, the parties 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:

Authorized Signatory

 

 

 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Committed Buyer and as a Buyer

 

 

 

 

 

By:

/s/ Margaret Dellafera

 

 

Name:

Margaret Dellafera

 

 

Title:

Authorized Signatory

 

 

 

 

 

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Authorized Signatory

 

 

 

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

 

 

 

 

 

By:

/s/ Elie Chau

 

 

Name:

Elie Chau

 

 

Title:

Vice President

 

 

 

 

 

 

 

 

 

By:

/s/ Jason Ruchelsman

 

 

Name:

Jason Ruchelsman

 

 

Title:

Director

 

Signature Page to Amendment No. 9 to Third Amended and Restated Master Repurchase Agreement

 

 

 

 

 

 

PENNYMAC LOAN SERVICES, LLC, as Seller

 

 

 

 

 

By:

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Senior Managing Director and Treasurer

 

 

 

 

 

 

PRIVATE NATIONAL MORTGAGE ACCEPTANCE  COMPANY, LLC, as Guarantor

 

 

 

 

 

By:

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Senior Managing Director and Treasurer

 

 

Signature Page to Amendment No. 9 to Third Amended and Restated Master Repurchase Agreement

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Section 5: EX-10.4 (EX-10.4)

10.4 GMSR Supp Indent

Exhibit 10.4

EXECUTION VERSION

 

 

 

PNMAC GMSR ISSUER TRUST,

as Issuer

and

CITIBANK, N.A.,

as Indenture Trustee, Calculation Agent, Paying Agent and Securities Intermediary

and

PENNYMAC LOAN SERVICES, LLC,

as Administrator and as Servicer

and

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC,

as Administrative Agent


SERIES 2020-SPIADVF1 INDENTURE SUPPLEMENT

Dated as of April 1, 2020

To

THIRD AMENDED AND RESTATED INDENTURE

Dated as of April 1, 2020

MSR COLLATERALIZED NOTES,

SERIES 2020-SPIADVF1

 

 

 

 

 

 

TABLE OF CONTENTS

 

 

 

 

PAGE

SECTION 1.

CREATION OF SERIES 2020-SPIADVF1 NOTES.

1

SECTION 2.

DEFINED TERMS.

2

SECTION 3.

FORMS OF SERIES 2020-SPIADVF1 NOTES.

6

SECTION 4.

INTEREST PAYMENT AMOUNT.

6

SECTION 5.

PAYMENTS; NOTE BALANCE INCREASES; EARLY MATURITY.

6

SECTION 6.

OPTIONAL REDEMPTION.

7

SECTION 7.

DETERMINATION OF NOTE INTEREST RATE AND LIBOR.

8

SECTION 8.

CONDITIONS PRECEDENT SATISFIED.

8

SECTION 9.

REPRESENTATIONS AND WARRANTIES.

8

SECTION 10.

AMENDMENTS.

9

SECTION 11.

COUNTERPARTS.

9

SECTION 12.

ENTIRE AGREEMENT.

10

SECTION 13.

LIMITED RECOURSE.

10

SECTION 14.

OWNER TRUSTEE LIMITATION OF LIABILITY.

10

 

 

-i-

 

THIS SERIES 2020-SPIADVF1 INDENTURE SUPPLEMENT (this “Indenture Supplement”), dated as of April 1, 2020, is made by and among PNMAC GMSR ISSUER TRUST, a statutory trust organized under the laws of the State of Delaware, as issuer (the “Issuer”), CITIBANK, N.A., a national banking association, as indenture trustee (the “Indenture Trustee”), as calculation agent (the “Calculation Agent”), as paying agent (the “Paying Agent”) and as securities intermediary (the “Securities Intermediary”), PENNYMAC LOAN SERVICES, LLC, a limited liability company organized under the laws of the State of Delaware (“PLS”), as administrator (the “Administrator”) and as servicer (the “Servicer”), and CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC (“CSFB”), a Delaware limited liability company, as Administrative Agent (as defined herein).  This Indenture Supplement relates to and is executed pursuant to that certain Third Amended and Restated Base Indenture supplemented hereby, dated as of April 1, 2020, including the schedules and exhibits thereto (as amended, restated, supplemented, restated or otherwise modified from time to time, the “Base Indenture”), among the Issuer, PLS, the Indenture Trustee, the Calculation Agent, the Paying Agent, the Securities Intermediary, and PENTALPHA SURVEILLANCE LLC, a Delaware limited liability company, as credit manager (the “Credit Manager”), CSFB, as Administrative Agent and the “Administrative Agents” from time to time parties thereto, all the provisions of which are incorporated herein as modified hereby and shall be a part of this Indenture Supplement as if set forth herein in full (the Base Indenture as so supplemented by this Indenture Supplement, collectively referred to as the “Indenture”).

Capitalized terms used and not otherwise defined herein shall have the respective meanings given them in the Base Indenture.

PRELIMINARY STATEMENT

The Issuer has duly authorized the issuance of a Series of Variable Funding Notes, the “PNMAC GMSR ISSUER TRUST MSR Collateralized Notes, Series 2020-SPIADVF1” (the “Series 2020-SPIADVF1 Notes”). The parties are entering into this Indenture Supplement to document the terms of the issuance of the Series 2020-SPIADVF1 Notes pursuant to the Base Indenture, which provides for the issuance of Notes in multiple series from time to time.

Section 1.        Creation of Series 2020-SPIADVF1 Notes.

There are hereby created, effective as of the Issuance Date, the Series 2020-SPIADVF1 Notes, to be issued pursuant to the Base Indenture and this Indenture Supplement, to be known as “PNMAC GMSR ISSUER TRUST MSR Collateralized Notes, Series 2020-SPIADVF1 Notes” The Series 2020-SPIADVF1 Notes are not rated and are subordinate to the Series 2016-MBSADV1 Notes, but shall not be subordinated to any other Series of Notes.  The Series 2020-SPIADVF1 Notes are issued in one (1) Class of Variable Funding Notes (Class A-SPIADVF1) with the Maximum VFN Principal Balance, Stated Maturity Date, Note Interest Rate and other terms as specified in this Indenture Supplement.  The Series 2020-SPIADVF1 Notes shall be secured by the Trust Estate Granted to the Indenture Trustee pursuant to the Base Indenture.  The Indenture Trustee shall hold the Trust Estate as collateral security for the benefit of the Noteholders of the Series 2020-SPIADVF1 Notes and all other Series of Notes issued under the Base Indenture as described therein.  In the event that any term or provision contained herein with respect to the Series 2020-SPIADVF1 Notes shall conflict with or be inconsistent with any term or provision

 

 

 

contained in the Base Indenture, the terms and provisions of this Indenture Supplement shall govern to the extent of such conflict.

Section 2.        Defined Terms.

With respect to the Series 2020-SPIADVF1 Notes and in addition to or in replacement for the definitions set forth in Section 1.1 of the Base Indenture, the following definitions shall be assigned to the defined terms set forth below:

Additional Note Payment” means a payment made by the owner of the Owner Trust Certificate to the Noteholder of the Series 2020-SPIADVF1 Notes during the Revolving Period to reduce the unpaid principal balance of the Series 2020-SPIADVF1 Notes.

Administrative Agent” means, for so long as the Series 2020-SPIADVF1 Notes have not been paid in full: (i) with respect to the provisions of this Indenture Supplement, CSFB, or an Affiliate or successor thereto; and (ii) with respect to the provisions of the Base Indenture, and notwithstanding the terms and provisions of any other Indenture Supplement, CSFB, and such other parties as set forth in any other Indenture Supplement, or a respective Affiliate or any respective successor thereto.  For the avoidance of doubt, reference to “it” or “its” with respect to the Administrative Agent in the Base Indenture shall mean “them” and “their,” and reference to the singular therein in relation to the Administrative Agent shall be construed as if plural.

Advance Rate” means, with respect to the Series 2020-SPIADVF1 Notes, on any date of determination, the weighted average percentage of the Collateral Value, weighted based on (i) (A) with respect to Servicing Advances, the portion of the Advance Reimbursement Balance allocable to each type of Advance Reimbursement Amount for the related Advance or (B) with respect to MBS Advances, and either the Ginnie Mae I MBS Program or Ginnie Mae II MBS Program, respectively, the unpaid principal balance attributable to FHA Loans, VA Loans or Other Loans, respectively, that are delinquent as of the most recent date of determination and (ii) the applicable Advance Rat