EXECUTION

Exhibit 10.87

 

AMENDMENT NO. 15
TO MORTGAGE LOAN PARTICIPATION PURCHASE AND SALE AGREEMENT

Amendment No. 15 to Mortgage Loan Participation Purchase and Sale Agreement,
dated as of June 29, 2018 (this “Amendment”), by and among Bank of America, N.A.
(“Purchaser”), PennyMac Corp. (“Seller”), PennyMac Mortgage Investment Trust and
PennyMac Operating Partnership, L.P. (individually and collectively, the
“Guarantor”).

RECITALS

Purchaser, Guarantor and Seller are parties to that certain Mortgage Loan
Participation Purchase and Sale Agreement, dated as of December 23, 2011 (as
amended, restated, supplemented or otherwise modified from time to time, the
“Existing MLPSA”; and as further amended by this Amendment, the “MLPSA”).  The
Guarantor is a party to that certain Guaranty (as amended, restated,
supplemented or otherwise modified from time to time, the “Guaranty”), dated as
of December 23, 2011, made by Guarantor in favor of Purchaser.

Purchaser, Seller and Guarantor have agreed, subject to the terms and conditions
of this Amendment, that the Existing MLPSA be amended to reflect certain agreed
upon revisions to the terms of the Existing MLPSA.  As a condition precedent to
amending the Existing MLPSA, Purchaser has required Guarantor to ratify and
affirm the Guaranty on the date hereof.

Accordingly, Purchaser, Seller and Guarantor hereby agree, in consideration of
the mutual promises and mutual obligations set forth herein, that the Existing
MLPSA is hereby amended as follows:

Section 1.Definitions.  Section 1 of the Existing MLPSA is hereby amended by:

1.1 deleting the definitions of “Effective Date”, “Expiration Date” and “Trade
Assignment” in their entirety and replacing them with the following:

“Effective Date”: July 2, 2018.

“Expiration Date”:  The earlier of (i) July 1, 2019, (ii) at Purchaser’s option,
upon the occurrence of an Event of Default, and (iii) the date on which this
Agreement shall terminate in accordance with the provisions hereof or by
operation of law.

“Trade Assignment”:  A letter substantially in the form of Exhibit B that has
been duly executed by an authorized representative of Seller (as set forth in
the resolutions of the board of directors of Seller (or its equivalent governing
body) as delivered to Purchaser) or, any additional signatory designated by such
authorized representative of Seller to Purchaser from time to time (it being
understood that the addition of a user on Purchaser’s warehouse lending website
by an authorized representative of Seller shall be deemed a valid designation of
such user as an additional signatory).

1.2adding the following definitions in their proper alphabetical order:

1

--------------------------------------------------------------------------------

 

“Anti-Money Laundering Laws”:  As defined in Section 10(a)(xxviii).

“Beneficial Ownership Certification”:  A certification regarding beneficial
ownership required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation”:  31 C.F.R. § 1010.230.

“Facility Fee”: As defined in the Pricing Side Letter.

“Sanctions”:  As defined in Section 10(a)(xxix).

“Takeout Investor”:  Any of (i) Bank of America, N.A., (ii) Merrill Lynch,
Pierce, Fenner & Smith Incorporated or (iii) any other Approved Investor with
which there is a duly executed and enforceable Trade Assignment in favor of
Purchaser.  

Section 2.Takeout Investor.  The Existing MLPSA is hereby amended by deleting
all references to “Approved Investor” (other than in the definition of “Approved
Investor”) in their entirety and replacing them with “Takeout Investor”.

Section 3.Procedures for Purchases of Participation Certificates.  Section 2(b)
of the Existing MLPSA is hereby amended by deleting such subsection in its
entirety and replacing it with the following:

(b)If Purchaser elects to purchase any Participation Certificate hereunder,
Purchaser shall pay (i) to Seller or (ii) upon the receipt of a Warehouse
Lender’s Release, to the applicable Warehouse Lender, on the Purchase Date, the
amount of the Purchase Price (less the Holdback Amount) for such Participation
Certificate upon receipt of a duly executed and properly completed copy of the
Participation Certificate, provided that, if the Purchase Price (less the
Holdback Amount) is insufficient to pay the release amount due to the Warehouse
Lender, Seller shall remit to Purchaser the difference between the Purchase
Price (less the Holdback Amount) and such release amount and Purchaser shall
remit the full release amount to the Warehouse Lender.  Effective upon (i)
execution of the Participation Certificate by an authorized representative of
Seller (as set forth in the resolutions of the board of directors of Seller (or
its equivalent governing body) as delivered to Purchaser, or, any additional
signatory designated by such authorized representative of Seller to Purchaser
from time to time (it being understood that the addition of a user on
Purchaser’s warehouse lending website by an authorized representative of Seller
shall be deemed a valid designation of such user as an additional signatory) and
(ii) delivery of such copy of the Participation Certificate to Purchaser, Seller
hereby assigns to Purchaser all of Seller’s right, title and interest in and to
such Participation Certificate and a 100% undivided beneficial ownership
interest in the Related Mortgage Loans.  In the event that Purchaser does not
transmit such payment, (i) any Participation Certificate delivered by Custodian
to Purchaser in anticipation of such purchase shall automatically be null and
void, (ii) Purchaser will not consummate the transactions contemplated in the
applicable Trade Assignment and (iii) to the extent that Purchaser shall
nevertheless receive the Security backed by the Related Mortgage Loans prior to
the Related

2

--------------------------------------------------------------------------------

 

Participation Certificate becoming null and void as provided in clause (i)
above, Purchaser shall take all reasonable actions necessary to ensure that such
Security shall be delivered in accordance with Seller’s delivery instructions
specified in Annex A.

Section 4.Record Title to Mortgage Loans; Intent of Parties; Security
Interest.  Section 8(c) of the Existing MLPSA is hereby amended by deleting such
subsection in its entirety and replacing it with the following:

(c)Purchaser and Seller confirm that the transactions contemplated herein are
intended to be sales of the Participation Certificates by Seller to Purchaser
rather than borrowings secured by the Participation Certificates.  In the event,
for any reason, any transaction is construed by any court or regulatory
authority as a borrowing rather than as a sale, in order to secure the Seller’s
obligations hereunder and any other obligations between the Seller on the one
hand and the Purchaser and its Affiliates on the other, and in any event, Seller
and Purchaser intend that Purchaser or its Assignee, as the case may be, shall
have, and the Seller hereby grants, assigns and pledges to Purchaser or its
Assignee a perfected first priority security interest in all of Seller’s right,
title and interest in, to and under the Participation Certificates, all of the
servicing rights with respect to the Related Mortgage Loans, and all
documentation and rights to receive documentation related to such servicing
rights and the servicing of the Related Mortgage Loans, the Custodial Account
and all amounts on deposit therein, the Related Mortgage Loans subject to each
Participation Certificate, all documents, records (including, without
limitation, Servicing Records and copies of all documentation in connection with
the underwriting and origination of any Related Mortgage Loan that evidences
compliance with the Ability to Repay Rule and the QM Rule), instruments and data
evidencing the Related Mortgage Loans and the servicing thereof, the Securities
to be issued as contemplated hereunder and all proceeds thereof, the Takeout
Commitments, any funds of the Seller at any time deposited or held in the
Over/Under Account and the proceeds of any and all of the foregoing in all
instances, whether now owned or hereafter acquired, now existing or hereafter
created (collectively, the “Collateral”), free and clear of adverse claims.  In
such case, Seller shall be deemed to have hereby granted to Purchaser or its
Assignee, as the case may be, a first priority security interest in and lien
upon the Collateral, free and clear of adverse claims.  In such event, this
Agreement shall constitute a security agreement, the Custodian shall be deemed
to be an independent custodian for purposes of perfection of the security
interest herein granted to Purchaser, and Purchaser or each such Assignee shall
have all of the rights of a secured party under applicable law.  Without
limiting the generality of the foregoing and for the avoidance of doubt, if any
determination is made that the servicing rights with respect to the Related
Mortgage Loans were not sold by Seller to Purchaser or that that such servicing
rights are not an interest in the Related Mortgage Loans and are severable from
the Related Mortgage Loans despite Purchaser’s and Seller’s express intent
herein to treat them as included in the purchase and sale transaction, Seller
hereby expressly pledges, assigns and grants to Purchaser a continuing first
priority security interest in and lien upon the

3

--------------------------------------------------------------------------------

 

servicing rights and all documentation and rights to receive documentation
related to such servicing rights and the servicing of each of the Related
Mortgage Loans (the “Related Credit Enhancement”).  The Related Credit
Enhancement is hereby pledged as further security for Seller’s obligations to
Purchaser hereunder.

Section 5.Representations and Warranties.  Section 10 of the Existing MLPSA is
hereby amended by (i) deleting “; and” at the end of subsection (a)(xxvii) and
replacing it with “.” and (ii) adding the following subsections (a)(xxviii),
(a)(xxix) and (xxx) at the end thereof:

(xxviii)Seller has complied with all applicable anti-money laundering laws and
regulations, including, without limitation, the USA Patriot Act of 2001, as
amended, and the Bank Secrecy Act of 1970, as amended (collectively, the “Anti
Money Laundering Laws”); Seller has established an anti-money laundering
compliance program as required by the Anti-Money Laundering Laws, has conducted
the requisite due diligence in connection with the origination of each Related
Mortgage Loan for purposes of the Anti-Money Laundering Laws, including with
respect to the bona fide identity of the applicable Mortgagor and the origin of
the assets used by said Mortgagor to purchase the property in question, and
maintains, and will maintain, sufficient information to identify the applicable
Mortgagor for purposes of the Anti-Money Laundering Laws.

(xxix)Neither Seller nor any of its Affiliates, officers, directors, partners or
members, (i) is an entity or person (or to the Seller’s knowledge, owned or
controlled by an entity or person) that (A) is currently the subject of any
economic sanctions administered or imposed by the Office of Foreign Assets
Control of the U.S. Department of the Treasury, the U.S. Department of State,
the United Nations Security Council, the European Union, Her Majesty’s Treasury
or any other relevant authority (collectively, “Sanctions”) or (B) resides, is
organized or chartered, or has a place of business in a country or territory
that is currently the subject of Sanctions or (ii) is engaging or will engage in
any dealings or transactions prohibited by Sanctions or will directly or
indirectly use the proceeds of any transactions contemplated hereunder, or lend,
contribute or otherwise make available such proceeds to or for the benefit of
any person or entity, for the purpose of financing or supporting, directly or
indirectly, the activities of any person or entity that is currently the subject
of Sanctions.

(xxx)The information included in the Beneficial Ownership Certification, if
applicable, is true and correct in all respects.

Section 6.Covenants of Seller.  Section 11 of the Existing MLPSA is hereby
amended by adding the following new subsection (gg):

(gg)Beneficial Ownership Certification.  Seller shall at all times either
(i) ensure that the Seller has delivered to Purchaser a Beneficial Ownership
Certification, if applicable, and that the information contained therein is true
and correct in all respects, or (ii) deliver to Purchaser an updated Beneficial
Ownership Certification within one (1)

4

--------------------------------------------------------------------------------

 

Business Day following the date on which the information contained in any
previously delivered Beneficial Ownership Certification ceases to be true and
correct in all respects.

Section 7.Notice Information.  Section 21 of the Existing MLPSA is hereby
amended by deleting the notice information for Seller, Guarantor and Purchaser
in its entirety and replacing it with the following:

If to Seller or a Guarantor:

PennyMac Corp.
3043 Townsgate Road

Westlake Village, CA 91361
Attention: Pamela Marsh
Phone Number: (818) 330-6059
E-mail: pamela.marsh@pnmac.com

with a copy to:

PennyMac Corp.
3043 Townsgate Road

Westlake Village, CA 91361
Attention: Jeff Grogin
Phone Number: (818) 224-7050
E-mail: jeff.grogin@pnmac.com

 

If to Purchaser:

Bank of America, N.A.
31303 Agoura Road

Mail Code: CA6-917-02-63

Westlake Village, California 91361

Attention: Adam Gadsby, Managing Director

Telephone: (818) 225-6541

Facsimile: (213) 457-8707

Email: Adam.Gadsby@baml.com

 

With copies to:

 

Bank of America, N.A.

One Bryant Park, 11th Floor

Mail Code: NY1-100-11-01

New York, New York 10036

Attention: Eileen Albus, Vice President, Mortgage Finance

Telephone:  (646) 855-0946

Facsimile:  (646) 855-5050

Email: Eileen.Albus@baml.com

 

5

--------------------------------------------------------------------------------

 

Bank of America, N.A.

One Bryant Park

Mail Code: NY1-100-17-01

New York, New York 10036

Attention: Amie Davis, Assistant General Counsel

Telephone: (646) 855-0183
E-mail: Amie.Davis@bankofamerica.com

Section 8.Fees and Expenses.  Seller hereby agrees to pay to Purchaser, on
demand, any and all reasonable fees, costs and expenses (including reasonable
fees and expenses of counsel) incurred by Purchaser in connection with the
development, preparation and execution of this Amendment, irrespective of
whether any transactions hereunder are executed.

Section 9.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:

9.1Delivered Documents.  On the Amendment Effective Date, the Purchaser shall
have received this Amendment, executed and delivered by a duly authorized
officer of Purchaser, Seller and Guarantor.

9.2Facility Fee. Seller shall have paid to Purchaser in immediately available
funds that portion of the Facility Fee due and payable on the Amendment
Effective Date.

Section 10.Limited Effect.  Except as expressly amended and modified by this
Amendment, the Existing MLPSA shall continue to be, and shall remain, in full
force and effect in accordance with its terms.

Section 11.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 12.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 13.GOVERNING LAW.  ThIS AMENDMENT shall be construed in accordance with
the laws of the state of new york without giving effect to the conflicts of law
principles thereof (except for section 5-1401 of the new york general
obligations law) and the obligations, rights and remedies of the PARties
hereunder shall be determined in accordance with the laws of the state of new
york, except to the extent preempted by federal law.

6

--------------------------------------------------------------------------------

 

Section 14.Reaffirmation of Guaranty.  The Guarantor hereby (i) agrees that the
liability of Guarantor or rights of Purchaser under the Guaranty shall not be
affected as a result of this Amendment, (ii) ratifies and affirms all of the
terms, covenants, conditions and obligations of the Guaranty and (iii)
acknowledges and agrees that such Guaranty is and shall continue to be in full
force and effect.

[SIGNATURE PAGE FOLLOWS]

 

7

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have caused their names to be signed hereto by
their respective officers thereunto duly authorized as of the day and year first
above written.

 

 

Bank of America, N.A., as Purchaser

 

 

By:

/s/ Adam Robitshek

 

Name:

 

Adam Robitshek

 

Title:

 

Vice President

 

 

PENNYMAC CORP., as Seller

 

 

 

By:

 

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Managing Director, Treasurer

 

 

 

 

PENNYMAC MORTGAGE INVESTMENT TRUST, as Guarantor

 

 

 

 

By:

 

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Managing Director, Treasurer

 

 

 

 

PENNYMAC OPERATING PARTNERSHIP, L.P., as Guarantor

 

 

 

By:

 

PennyMac GP OP, Inc., its General Partner

 

 

 

 

 

 

 

 

By:

 

/s/ Pamela Marsh

 

 

Name:

Pamela Marsh

 

 

Title:

Managing Director, Treasurer