Exhibit 10.11

EXECUTION COPY

 

MASTER REPURCHASE AGREEMENT

among

PENNYMAC LOAN SERVICES, LLC,

 as Seller,

PRIVATE NATIONAL MORTGAGE ACCEPTANCE COMPANY, LLC,

 as Guarantor,

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

 as Buyer

and

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC,

as Administrative Agent

Dated as of September 11, 2019

 

 

 

 

TABLE OF CONTENTS

 

 

Page

ARTICLE I

DEFINITIONS AND ACCOUNTING MATTERS

2

Section 1.01

Definitions; Construction.

2

Section 1.02

Accounting Matters

2

ARTICLE II

TRANSACTIONS, BORROWING, PREPAYMENT

3

Section 2.01

Transactions

3

Section 2.02

Procedure for Entering into Transactions.

3

Section 2.03

Asset Base Reports

4

Section 2.04

Price Differential

4

Section 2.05

Increased Capital Costs

5

Section 2.06

Alternate Rate of Interest

5

Section 2.07

Margin Calls.

5

Section 2.08

Mandatory Repurchase; Optional Prepayment.

6

ARTICLE III

PAYMENTS; COMPUTATIONS; TAXES; FEES

6

Section 3.01

Payments and Computations, Etc.

6

Section 3.02

Taxes.

7

Section 3.03

Fees and Expenses

9

ARTICLE IV

SECURITY INTEREST

9

Section 4.01

Security Interest

9

Section 4.02

Provisions Regarding Pledge of Servicing Rights and the Excess Spread to Be
Included In Financing Statements

11

Section 4.03

Authorization of Financing Statements

12

Section 4.04

Buyer’s Appointment as Attorney In Fact.

12

Section 4.05

Release of Security Interest

13

ARTICLE V

CONDITIONS PRECEDENT

14

Section 5.01

Conditions Precedent

14

Section 5.02

Further Conditions Precedent

14

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

14

Section 6.01

Representations and Warranties of Each Seller Party

14

Section 6.02

Representations Concerning the Repurchase Assets

19

ARTICLE VII

COVENANTS

20

Section 7.01

Covenants of the Seller

20

Section 7.02

Notice of Certain Occurrences

27

ARTICLE VIII

EVENTS OF DEFAULT

29

Section 8.01

Events of Default

29

Section 8.02

Remedies.

31

Section 8.03

Application of Proceeds

33

 

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ARTICLE IX

ASSIGNMENT

33

Section 9.01

Restrictions on Assignments; Register

33

Section 9.02

Rights of Assignee

34

Section 9.03

Permitted Participants; Effect.

34

Section 9.04

Voting Rights of Participants

35

ARTICLE X

INDEMNIFICATION

35

Section 10.01

Indemnities by the Seller

35

Section 10.02

General Provisions

36

ARTICLE XI

MISCELLANEOUS

36

Section 11.01

Amendments, Etc

36

Section 11.02

Notices, Etc

36

Section 11.03

No Waiver; Remedies

36

Section 11.04

Binding Effect; Assignability

37

Section 11.05

GOVERNING LAW; SUBMISSION TO JURISDICTION

37

Section 11.06

Entire Agreement and Single Agreement.

37

Section 11.07

Acknowledgement

38

Section 11.08

Captions and Cross References

38

Section 11.09

Execution in Counterparts

38

Section 11.10

Confidentiality

38

Section 11.11

Survival

39

Section 11.12

Set-Off

39

Section 11.13

Guaranty.

39

Section 11.14

Intent.

41

 

 

 

Schedules

 

 

Schedule I

Definitions

 

Schedule II

Eligibility Criteria with respect to the Eligible Servicing Rights

 

Schedule 4.01

Assets

 

Schedule 5.01

Conditions Precedent to the Effectiveness of this Agreement

 

Schedule 5.02

Conditions Precedent to each Transaction

 

Schedule 6.01(s)

Seller’s Existing Financing Facilities

 

Schedule 6.02(h)

Representations and Warranties regarding the Participation Certificate

 

Schedule 7.01(bb)

Monthly Repurchase Assets Report

 

Schedule 11.02

Notices

 

 

 

 

Exhibits

 

 

Exhibit 2.02

Form of Transaction Notice

 

Exhibit 2.08

Form of Repurchase Notice

 

 

 

 

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This MASTER REPURCHASE AGREEMENT, dated as of September 11, 2019 (as amended or
supplemented from time to time, this “Agreement”), is among PENNYMAC LOAN
SERVICES, LLC (the “Seller” or the “Servicer”), PRIVATE NATIONAL MORTGAGE
ACCEPTANCE COMPANY, LLC (the “Guarantor”), CREDIT SUISSE AG, CAYMAN ISLANDS
BRANCH (the “Buyer”) and CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC (the
“Administrative Agent”).

BACKGROUND

WHEREAS, the Seller has always made, and shall in the future make, the Eligible
Servicing Rights (as defined below) subject to this Agreement, subject to the
Participation Agreement in order to create Excess Spread evidenced by the
Participation Certificate;

WHEREAS, on the Closing Date the parties hereto intend to enter into a
transaction in which the Seller agrees to transfer to the Buyer the
Participation Certificate, and from time to time thereafter the parties hereto
may enter into additional transactions in connection with the addition of
Eligible Servicing Rights to the Participation Certificate.  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, the Seller will pledge certain Eligible Servicing Rights in connection
with the Transactions;

WHEREAS, in order to finance Eligible Servicing Rights and the related Excess
Spread (as defined below) owned by the Seller from time to time, the Seller has
requested and the Buyer has made and will make available to the Seller this
repurchase facility in an amount not to exceed the Maximum Purchase Price (the
“MSR PC Repo Facility”);

WHEREAS, the Seller and the Buyer desire to restructure the transactions related
to Fannie Mae Servicing Rights documented in that certain Loan and Security
Agreement, dated as of February 1, 2018 (as amended, restated, supplemented or
otherwise modified from time to time, the “Conventional MSR Loan Agreement”), by
and among the Seller, the Guarantor and the Buyer, as repurchase transactions;

WHEREAS, the parties hereto have agreed that the Conventional MSR Loan Agreement
be restructured to remove the Fannie Mae Servicing Rights from the collateral
thereunder, and that the Fannie Mae Servicing Rights shall be subject to this
MSR PC Repo Facility on the terms and subject to the conditions set forth
herein; and

WHEREAS, the Buyer has required and the Guarantor has agreed that it will
Guarantee the Obligations hereunder.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

ARTICLE I

DEFINITIONS AND ACCOUNTING MATTERS

Section 1.01    Definitions; Construction.

(a)        Capitalized terms used herein and not otherwise defined herein shall
have the meanings specified in Schedule I.

(b)        All terms used in Article 9 of the UCC, and not specifically defined
herein, are used herein as defined in such Article 9.

(c)        Unless otherwise stated in this Agreement, in the computation of a
period of time from a specified date to a later specified date, the word “from”
means “from and including” and the words “to” and “until” each means “to but
excluding”.

(d)        The definitions of terms herein shall apply equally to the singular
and plural forms of the terms defined.

(e)        Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms.

(f)        The words “include”, “includes” and “including” shall be deemed to be
followed by the phrase “without limitation”. The word “will” shall be construed
to have the same meaning and effect as the word “shall”.

(g)        Unless the context requires otherwise (i) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(ii) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (iii) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (iv) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement, and (v) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.

Section 1.02    Accounting Matters.  Except as otherwise expressly provided
herein, all accounting terms used herein shall be interpreted, and all financial
statements and certificates and reports as to financial matters required to be
delivered to the Buyer hereunder shall be prepared in accordance with GAAP.

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ARTICLE II

TRANSACTIONS, BORROWING, PREPAYMENT

Section 2.01    Transactions. On the terms and subject to the conditions set
forth in this Agreement, the Buyer shall enter into Transactions with the Seller
for a Purchase Price as set forth in the related Transaction Notice.  The
Purchase Price for any Transaction, together with the aggregate outstanding
Repurchase Prices for all other outstanding Transactions, shall not to exceed
the Maximum Purchase Price.  During the Commitment Period, the Seller may
utilize the Commitment by requesting Transactions, the Seller may pay the
Repurchase Price in whole or in part at any time during such period, and
additional Transactions may be entered into in accordance with the terms and
conditions hereof. The Buyer shall distribute the proceeds of the Purchase Price
to the Seller no later than 1:00 p.m. (New York City time) on the related
Purchase Date in accordance with Section 2.02.  The Buyer’s obligation to enter
into Transactions pursuant to the terms of this Agreement shall terminate on the
Termination Date. Notwithstanding the foregoing, the Buyer shall have no
commitment or obligation to enter into Transactions in connection with Eligible
Servicing Rights to the extent the Purchase Price of such Transaction exceeds
the Asset Base or if the Purchase Price together with the aggregate outstanding
Repurchase Prices for all other outstanding Transactions exceeds the Maximum
Purchase Price.

Section 2.02    Procedure for Entering into Transactions.

(a)        During the Commitment Period, on any Purchase Date prior to the
Amortization Date, the Seller may enter into Transactions with the Buyer under
the MSR PC Repo Facility by delivering to the Buyer an irrevocable notice (each,
a “Transaction Notice”) no later than 3:00 p.m. (New York City time) on a
Transaction Notice Date, which notice (i) shall be substantially in the form of
Exhibit 2.02, (ii) shall be signed by a Responsible Officer of the Seller, and
(iii) shall specify (A) the dollar amount of the requested Purchase Price, (B)
the value of the Eligible Servicing Rights on the Seller’s books and records,
and (C) the information required to be included in the Asset Schedule with
respect to each such Asset in mutually acceptable electronic form.

(b)        The initial Transaction (the “Initial Transaction”) shall not be less
than $5,000,000. The Seller may request a Transaction on any Business Day;
provided, however, a Purchase Date may not fall on any of the five (5) last
Business Days in any calendar month unless otherwise agreed to by the Buyer.
Each Transaction Notice shall include an Electronic File describing the
Participation Certificate and all of the Eligible Servicing Rights that are
included in the Repurchase Assets hereunder.

(c)        Regardless whether the Seller intends to deliver a Transaction Notice
during any calendar month, the Seller shall deliver to the Buyer on the
fifteenth (15th) calendar day of each month (or, if such day is not a Business
Day, the following Business Day) (any such day, an “Asset Reporting Date”), an
Electronic File with respect to the Participation Certificate and all of the
Eligible Servicing Rights that are included in the Repurchase Assets hereunder,
which shall include all updates to the Repurchase Assets since the date of the
preceding Electronic File.

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(d)        If the Seller delivers to the Buyer a Transaction Notice that
satisfies the requirements of Section 2.02(a), the Buyer will notify the Seller
no later than the Purchase Date of its intent to remit the requested Purchase
Price.  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, the Buyer shall remit the amount of the requested Purchase
Price in U.S. Dollars and in immediately available funds.

(e)        In the Buyer’s determination of Asset Value of the Participation
Certificate and the related Servicing Rights hereunder for purposes of
determining the Asset Base, it shall apply the MSR Value of the Eligible
Servicing Rights in a related Asset Base Report.  Any excess of the amount of
the Purchase Price over the Asset Value shall result in a Margin Deficit as set
forth in Section 2.07.  Notwithstanding anything to the contrary contained in
this Section 2.02, the Buyer shall have the right to determine the Asset Value
at any time in its sole discretion.

(f)        By delivering a Transaction Notice, the Seller represents and
warrants to the Buyer that, after taking into account the amount of the Purchase
Price, all conditions precedent to such Transaction specified in Section 5.02
have been satisfied.

(g)        Upon entering into each Transaction hereunder, the Asset Schedule
shall be automatically updated to include each of the Assets listed on the Asset
Schedule attached to the Transaction Notice.

Section 2.03    Asset Base Reports. With respect to each Purchase Date, the
Buyer shall determine the Asset Value of the Participation Certificate and the
related Eligible Servicing Rights to be pledged as security for the transfer of
the Purchase Price on such Purchase Date and shall communicate such
determination by providing the Seller with an Asset Base Report prior to such
Purchase Date. For purposes of preparing each Asset Base Report, the Buyer shall
calculate the Asset Value of the Participation Certificate based on the Eligible
Servicing Rights described in the Relevant Electronic File.

Section 2.04    Price Differential.  Price Differential shall accrue on each
Transaction for each day during a related Price Differential Period at a per
annum rate equal to the product of (x) the outstanding aggregate amount of the
Purchase Price on such day, multiplied by (y) the sum of (i) the applicable
LIBOR Rate for such day and (ii) the Applicable Margin (clauses (i) and (ii),
collectively, the “Pricing Rate”).  Price Differential shall be payable on each
Price Differential Payment Date in arrears with respect to each Transaction
through the final day of each Price Differential Period (regardless whether such
day is a Business Day). The Administrative Agent shall determine the LIBOR Rate
for each Transaction, which may be reset on a daily basis, as set forth in the
definition of “LIBOR Rate” and provide notice of such determination to the
Seller. The Buyer shall also calculate the amount of Price Differential or other
amounts due to be paid by the Seller from time to time hereunder (including in
connection with any prepayment or repayment of the Repurchase Price permitted
hereunder) and shall provide a written statement thereof to the Seller at least
two (2) Business Days prior to the due date of such payments (or the relevant
repayment or prepayment after having received a notice thereof); provided, that
failure to provide such statements on a timely basis shall not relieve the
Seller of the obligation to pay any Price Differential and Purchase Price due on
the applicable payment date (based upon its good faith calculation of the amount
due, such amount to be promptly reconciled after receipt of a subsequent

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statement from the Buyer) and other such amounts hereunder promptly upon receipt
of such statement.

Section 2.05    Increased Capital Costs. If the Buyer determines in its sole
discretion that any Change in Law or any change in accounting rules regarding
capital requirements has the effect of reducing the rate of return on the
Buyer’s capital under this Agreement as a consequence of such Change in Law or
change in accounting rules, then from time to time the Seller will compensate
the Buyer for such reduced rate of return suffered as a consequence of such
Change in Law or change in accounting rules on terms similar to those imposed by
the Buyer. Further, if due to the introduction of, any change in, or the
compliance by the Buyer with (i) any eurocurrency reserve requirement, or
(ii) the interpretation of any law, regulation or any guideline or request from
any central bank or other Governmental Authority whether or not having the force
of law, there shall be an increase in the cost to the Buyer as a consequence of
the Transactions or other advances of funds made by the Buyer pursuant to this
Agreement or any of the Facility Documents relating to entering into
Transactions or commitments under this Agreement, then the Seller shall from
time to time and upon demand by the Buyer, compensate the Buyer for such
increased costs, and such amounts shall be deemed a part of the Obligations
hereunder. The Buyer shall provide the Seller with notice as to any such Change
in Law, change in accounting rules or change in compliance promptly following
the Buyer’s receipt of actual knowledge thereof.

Section 2.06   Alternate Rate of Interest. If on any Business Day, the Buyer
determines (which determination shall be conclusive absent manifest error)
(a) that adequate and reasonable means do not exist for ascertaining the LIBOR
Rate; or (b) that the LIBOR Rate will not adequately and fairly reflect the cost
to the Buyer of entering into Transaction; or (c) that it has become unlawful
for it to honor its obligation to enter into Transactions hereunder using the
LIBOR Rate, or maintain existing Transactions, then the Buyer shall give notice
thereof to the Seller by telephone, facsimile, or other electronic means as
promptly as practicable thereafter and, until the Buyer notifies the Seller that
the circumstances giving rise to such notice no longer exist, any Transaction
Notice that requests that the Buyer enter into a new Transaction, subject to the
timely approval of the Seller after receipt of notice of such revised rate,
shall be at a rate per annum that the Buyer determines in its reasonable
discretion adequately reflects the cost to the Buyer of entering into
Transaction or maintaining an existing Transaction.

Section 2.07    Margin Calls.

(a)        If, on any Business Day (a “Margin Shortfall Day”), the Buyer
provides written notice to the Seller that the Buyer has determined in its sole
reasonable discretion based on the Asset Base Report most recently delivered by
the Buyer pursuant to Section 2.03 that the outstanding aggregate Repurchase
Price on such day exceeds the lesser of (i) the Asset Base and (ii) the Maximum
Purchase Price on such day (such circumstance, a “Margin Deficit”), the Seller
(i) on the same day if the Buyer notifies the Seller by 11:00 a.m. (New York
time) of such Margin Deficit, or (ii) if the notice is received later than
11:00 a.m. (New York time), then within one (1) Business Day after the Margin
Shortfall Day, shall pay the Repurchase Price (including accrued Price
Differential on Transactions entered into by it), in an amount equal to the
amount of the Margin Deficit specified in the notice provided to the Seller by
the Buyer (such requirement a “Margin Call”).

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Section 2.08    Mandatory Repurchase; Optional Prepayment.

(a)        On each Repurchase Date (or, if such day is not a Business Day, the
following Business Day) from and after the Amortization Date, and continuing
until the aggregate outstanding Repurchase Price shall be reduced to zero, the
Seller shall repay an amount equal to at least one-twelfth (1/12) of the
aggregate outstanding Repurchase Price as of the Amortization Date with respect
to all Transactions and all other amounts due under this Agreement.  The
Repurchase Price may be paid in accordance with the terms of Section 2.08 hereof
and, to the extent repaid, provided the Amortization Date shall not have
occurred, additional Transactions may be entered into hereunder in accordance
with the terms hereof (including satisfaction of all conditions precedent
contained in Section 5.02). Notwithstanding the foregoing, all amounts owing
under the MSR PC Repo Facility shall be immediately due and payable on the
Termination Date.

(b)        The Seller may, at its option, prepay the Repurchase Price in full or
in part on any date (any such date, an “Optional Prepayment Date”) by delivering
a Repurchase Notice to the Buyer one (1) Business Day prior to each Optional
Prepayment Date; provided, however, that the Seller shall be permitted at any
time, without limitation, to prepay a portion of the Repurchase Price related to
an individual Transaction in connection with a Margin Call (any such date, a
“Margin Call Payment Date,” and together with an Optional Prepayment Date, a
“Prepayment Date”).  Any such prepayment received by the Buyer by 3:00 p.m. (New
York City time) on a Prepayment Date shall be applied by the Buyer on such
Business Day.  Any such prepayment received by the Buyer after 3:00 p.m. (New
York City time) on such Prepayment Date shall be applied by the Buyer on the
following Business Day.  For the avoidance of doubt, any optional prepayment in
full shall not result in the termination of this Agreement unless such
termination is declared in writing by the Seller, acting in its discretion.

Section 2.09    Payment Procedure.

(a)        The Seller shall deposit or cause to be deposited all amounts
constituting collection, payments and proceeds of Assets (including, without
limitation, all fees and proceeds of sale) into the Dedicated Account in
accordance with Section 7.01(ee) hereof to be applied in accordance with
Section 3.04 hereof. The Seller absolutely, unconditionally, and irrevocably,
shall make, or cause to be made, all payments required to be made by the Seller
hereunder whether or not sufficient amounts are on deposit in the Dedicated
Account.

(b)        Notwithstanding any other provision of this Agreement, the Seller
shall be entitled to retain, from payments on, or relating to, the Mortgage
Loans, all Ancillary Income.  Ancillary Income shall not be required to be
deposited into the Dedicated Account, and shall not be subject to any offset,
netting or withdrawal under this Agreement.

ARTICLE III

PAYMENTS; COMPUTATIONS; TAXES; FEES

Section 3.01    Payments and Computations, Etc.

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(a)        Unless otherwise expressly stated herein, all amounts to be paid or
deposited hereunder shall be paid or deposited in accordance with the terms
hereof no later than 4:00 p.m. (New York City time) on the day when due in
lawful money of the United States of America in same day funds.

(b)        The Seller shall, to the extent permitted by law, pay interest on all
amounts (including principal, interest and fees) due but not paid on the date
such payment is due hereunder as provided herein, for the period from, and
including, such due date until, but excluding, the date paid, at the applicable
Default Rate, payable on demand; provided,  however that such interest rate
shall not at any time exceed the maximum rate permitted by applicable law.

(c)        All computations of interest and fees hereunder shall be made on the
basis of a year of 360 days for the actual number of days elapsed (including the
first day but excluding the last day) occurring in the period for which payable.

(d)        The Seller agrees that the payment of Repurchase Price shall be a
recourse obligation of the Seller.

(e)        All payments made by the Seller under this Agreement shall be made
without set-off or counterclaim.

Section 3.02    Taxes.

(a)        All payments made by any Seller Party under this Agreement shall be
made free and clear of, and without deduction or withholding for or on account
of, any present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities (including penalties, interest and additions
to tax) with respect thereto imposed by any Governmental Authority therewith or
thereon, excluding income taxes, branch profits taxes or franchise taxes
imposed, in each case, by the United States, a state or a foreign jurisdiction
under the laws of which the Buyer is organized or of its applicable lending
office, or a state or foreign jurisdiction with respect to which the Buyer has a
present or former connection (other than any connection arising from executing,
delivering, being party to, engaging in any transaction pursuant to, performing
its obligations under or enforcing  or assigning any Facility Document), or any
political subdivision thereof (collectively, such non-excluded taxes are
hereinafter called “Taxes”), all of which shall be paid by the Seller Party not
later than the date when due. If the Seller Party is required by law or
regulation to deduct or withhold any taxes from or in respect of any amount
payable hereunder, it shall: (a) make such deduction or withholding, (b) pay the
amount so deducted or withheld to the appropriate Governmental Authority not
later than the date when due, (c) deliver to the Buyer and/or the Administrative
Agent, promptly, original tax receipts and other evidence satisfactory to the
Buyer of the payment when due of the full amount of such taxes; and (d) except
as otherwise expressly provided in Section 3.02(d) below, pay to the Buyer
and/or the Administrative Agent such additional amounts (including all taxes
imposed by any Governmental Authority on such additional amounts) as may be
necessary so that the Buyer receives, free and clear of all Taxes (and any taxes
imposed thereon), a net amount equal to the amount it would have received under
this Agreement, as if no such deduction or withholding for Taxes had been made.

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(b)        In addition, each Seller Party agrees to pay to the relevant
Governmental Authority in accordance with applicable law any current or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies (including, without limitation, mortgage recording taxes,
transfer taxes and similar fees) imposed by any taxing authority that arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Agreement (“Other Taxes”).

(c)        Each Seller Party agrees to indemnify the Buyer and the
Administrative Agent for the full amount of Taxes (including additional amounts
with respect thereto) and Other Taxes, and the full amount of taxes of any kind
imposed by any jurisdiction on amounts payable under this Section 3.02, and any
liability (including penalties, interest and expenses arising thereon or with
respect thereto) arising therefrom or with respect thereto, provided that the
Buyer shall have provided the Seller Party and the Administrative Agent with
evidence, reasonably satisfactory to the Seller Party, of payment of Taxes or
Other Taxes, as the case may be.

(d)        Any Buyer that either (i) is not incorporated under the laws of the
United States, any State thereof, or the District of Columbia or (ii) whose name
does not include “Incorporated,” “Inc.,” “Corporation,” “Corp.,” “P.C.,”
“insurance company,” or “assurance company” (a “Foreign Purchaser”) shall
provide the Seller with original properly completed and duly executed United
States Internal Revenue Service (“IRS”) Forms W-8BEN, W-8BEN-E or W-8ECI or any
successor form prescribed by the IRS, certifying that such Person is either
(1) entitled to benefits under an income tax treaty to which the United States
is a party which eliminates or (2) otherwise fully exempt from United States
withholding tax under Sections 1441 through 1442 of the Code on payments to it
on or prior to the date upon which each such Foreign Lender becomes a Buyer.
Each Foreign Lender will resubmit the appropriate form eliminating withholding
tax on payments to it on the earliest of (A) the third anniversary of the prior
submission, or (B) on or before the expiration of thirty (30) days after there
is a “change in circumstances” with respect to such Person as defined in Treas.
Reg. Section 1.1441-1(e)(4)(ii)(D). For any period with respect to which the
Foreign Lender has failed to provide the Seller with the appropriate form or
other relevant document (x) as expressly required under this Section 3.02(d)
(unless such failure is due to a change in treaty, law, or regulation occurring
subsequent to the date on which a form originally was required to be provided,
under the first sentence of this Section 3.02(d)) or (y) otherwise as required
to establish exemption from United States withholding under FATCA, by such
Person or by such Person’s assignor or transferor, such Person shall not be
entitled to “gross-up” of Taxes under Section 3.02(d) or indemnification under
Section 3.02(c) with respect to Taxes imposed by the United States which are
imposed because of such failure; provided, however that should a Foreign Lender,
which is otherwise exempt from a withholding tax, become subject to Taxes
because of its failure to deliver a form required hereunder, the Seller shall
take such steps as such Foreign Lender shall reasonably request to assist such
Foreign Lender to recover such Taxes.

(e)        Without prejudice to the survival or any other agreement of a Seller
Party hereunder, the agreements and obligations of a Seller Party contained in
this Section 3.02 shall survive the termination of this Agreement. Nothing
contained in this Section 3.02 shall require the Buyer to make available any of
their tax returns or other information that it deems to be confidential or
proprietary.

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(f)        The Buyer shall (A) promptly notify the Seller of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction, and (B) cooperate, in its reasonable discretion and at the Seller’s
expense, with the Seller to mitigate any requirement of Applicable Law of any
jurisdiction in which a Seller Party may be required to withhold or deduct any
taxes from amounts payable to the Buyer hereunder.

(g)        The parties hereto agree and acknowledge this intent that the
transaction evidenced by this Agreement shall be treated, for U.S. federal
income and relevant state and local or other tax purposes, as a loan from the
Buyer to the Seller secured by the Repurchase Assets unless otherwise required
by law.

Section 3.03    Fees and Expenses.  The Seller agrees to pay to the Buyer all
reasonable and documented out-of-pocket costs and expenses (including reasonable
and documented fees and expenses of the Buyer’s counsel not to exceed $25,000)
incurred in connection with the execution of this Agreement (and any amendments
thereto) and the Facility Documents; provided that such limitation on fees and
expenses of the Buyer’s counsel shall not apply to (i) any amendment or renewal
of, or waiver of any provision of, this Agreement or any other Facility Document
or (ii) any document executed after the Closing Date in connection with the
transactions contemplated by this Agreement.

Section 3.04    Dedicated Account.  The Seller shall establish and maintain the
Dedicated Account in the form of a time deposit or demand account.  Amounts
received on account of MSRs and Excess Spread (excluding Ancillary Income and
the Base Servicing Fee) and retained by the Seller pursuant to the Servicing
Contract or Participation Agreement, as the case may be, shall, subject to
Section 7.01(ee), promptly, in any event within two (2) Business Days after
receipt, be deposited in the Dedicated Account.  Prior to an Event of Default,
funds deposited in the Dedicated Account (including any interest paid on such
funds) may only be used by the Seller in accordance with 7.01(ee).  On and after
the occurrence of an Event of Default as notified to the Seller by the
Administrative Agent, amounts on deposit in the Dedicated Account may only be
used to pay the Obligations hereunder, and the Seller shall not withdraw or
direct the withdrawal or remittance of any funds from the Dedicated
Account.  Upon the Termination Date and the payment of all amounts due by the
Seller hereunder, all amounts on deposit in the Dedicated Account shall be
remitted to the Seller.

ARTICLE IV

SECURITY INTEREST

Section 4.01    Security Interest.   (a) Although the parties intend that all
Transactions hereunder be sales and purchases and not loans (other than the
Servicing Rights, which are pledged, and not sold, to the Buyer), in the event
any such Transactions are deemed to be loans, and in any event, the Seller
hereby pledges to the Buyer as security for the performance by the Seller of its
Obligations and hereby grants, assigns and pledges to the Buyer a fully
perfected first priority security interest in all of the 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)         all Assets identified on an Asset Schedule or Schedule 4.01 herein;

(ii)       all Servicing Rights arising under or related to any Servicing
Contract and related Servicing Rights Asset;

(iii)      all rights to reimbursement or payment of Assets and/or amounts due
in respect thereof under the related Servicing Contract, Securitization
Transaction or Participation Agreement identified on Schedule 4.01 hereof;

(iv)       any rights in the Dedicated Account and to the amounts on deposit
therein;

(v)        all rights under each Participation Agreement;

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

(vii)     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 the Seller’s rights, title and
interest in and under the Participation Agreements and the Servicing Contracts);
and

(viii)    any and all replacements, substitutions, distributions on or proceeds
of any and all of the foregoing;

provided that the Seller does not assign or pledge to the Buyer, or grant a
security interest in any of the Seller’s right, title and interest, in, to or
under the Seller’s rights to the Excluded Collateral.

(b)        The Seller hereby assigns, pledges, conveys and grants a security
interest in all of its right, title and interest in, to and under the Repurchase
Assets to the Buyer to secure the Obligations.  The Seller agrees to mark its
computer records and tapes to evidence the interests granted to the Buyer
hereunder.

(c)        The Buyer and the Seller hereby agree that in order to further secure
the Seller’s Obligations hereunder, the Seller hereby grants to the Buyer a
security interest in (i) as of the Closing Date, the Seller’s rights (but not
its obligations) under the Facility 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
(collectively, the “Repurchase Rights”) and (ii) all collateral however defined
or described under the Facility Documents to the extent not otherwise included
under the definitions of Repurchase Assets or Repurchase Rights (such
collateral, “Additional Repurchase Assets”, together with the Primary Repurchase
Assets, collectively, the “Repurchase Assets”).

(d)        The parties acknowledge that Fannie Mae has certain rights under the
Fannie Mae Servicing Contract and the Acknowledgement Agreement, including the
right to cause the Seller to transfer servicing to the Buyer or Buyer’s designee
under certain circumstances as

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more particularly set forth therein.  To the extent that Fannie Mae requires a
transfer of servicing to an Affiliate of the Buyer and in order to secure the
Seller’s obligations to effect such transfer, the Seller hereby assigns,
pledges, conveys and grants a security interest in all of its right, title and
interest in, to and under the Servicing Rights to an Affiliate of the Buyer,
whether now owned or hereafter acquired, now existing or hereafter created and
wherever located.  The parties acknowledge that, to the extent that Fannie Mae
exercises its rights to cause the Seller to transfer the Servicing Rights and
Excess Spread to the Buyer or an Affiliate of the Buyer (and, if accepted by the
Buyer, to cause the Buyer or an Affiliate of the Buyer to accept and assume the
responsibility for performing the Seller’s servicing duties under, and otherwise
complying with the applicable Servicing Contract) without the requirement of
payment therefor, such transfer shall be deemed a transfer in exchange for debt
forgiveness by the Buyer in an amount equal to the lesser of (x) the fair market
value of such Servicing Rights and Excess Spread and (y) the outstanding balance
of the Purchase Price attributable to such Servicing Rights and Excess Spread,
each as determined by the Buyer.  An Affiliate of the Buyer shall have all the
rights and remedies against the Seller and the Purchased Assets and Repurchase
Assets as set forth herein and under the UCC.

(e)        The foregoing provisions of this Section 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(38)(A) and 741(7)(A)(xi) of the Bankruptcy Code.

Section 4.02    Provisions Regarding Pledge of Servicing Rights and the Excess
Spread to Be Included In Financing Statements.  Notwithstanding anything to the
contrary in the Agreement or any of the other Facility Documents, the security
interest of the Buyer created hereby with respect to the Fannie Mae Servicing
Rights and the Buyer’s interest in the Excess Spread is subject to the following
provisions, which shall be included in each financing statement filed in respect
hereof (or any variation required by Fannie Mae):

“The security interest described in this financing statement and the interests
of Credit Suisse AG, Cayman Islands Branch in the Excess Spread is subject and
subordinate to all rights, powers, and prerogatives of Fannie Mae under and in
connection with (i) the terms and conditions of that certain Acknowledgment
Agreement, with respect to the security interest and the Excess Spread, by and
among Fannie Mae, PennyMac Loan Services, LLC (the “Debtor”), and Credit Suisse
AG, Cayman Islands Branch, and (ii) the Mortgage Selling and Servicing Contract,
the Fannie Mae Selling Guide, the Fannie Mae Servicing Guide and any
supplemental servicing instructions or directives provided by Fannie Mae, all
applicable master agreements, recourse agreements, repurchase agreements,
indemnification agreements, loss-sharing agreements, and any other agreements
between Fannie Mae and the Debtor, and all as amended, restated or supplemented
from time to time (collectively, the “Fannie Mae Servicing Contract”), which
rights include, without limitation, the right of Fannie Mae to terminate the
Fannie Mae Lender Contract with or without cause and the right to sell, or have
transferred, the Servicing Rights as therein provided.”

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Section 4.03     Authorization of Financing Statements. The Seller hereby
authorizes the Buyer to terminate all rights of the Buyer related to the Fannie
Mae Servicing Rights under the Conventional MSR Loan Agreement and file any
financing or continuation statements required to perfect, protect, or more fully
evidence the Buyer’s security interest in the Repurchase Assets granted
hereunder. The Buyer will notify the Seller of any such filing (but the failure
to deliver such notice shall not prejudice any rights of the Buyer under this
Section 4.03).

Section 4.04    Buyer’s Appointment as Attorney In Fact.

(a)        The Seller hereby irrevocably constitutes and appoints the Buyer and
any officer or agent thereof, with full power of substitution, as its true and
lawful attorney‑in‑fact with full irrevocable power and authority in the place
and stead of the Seller and in the name of the Seller or in its own name, from
time to time in the Buyer’s discretion, if an Event of Default shall have
occurred and be continuing, for the limited purpose of carrying out the terms of
this Agreement (or any Servicing Contracts to the extent permitted by the
Acknowledgment Agreement), to take any action on behalf of the Seller pursuant
to the Acknowledgment Agreement and to take any and all appropriate action and
to execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement (or any Servicing
Contracts to the extent permitted by the Acknowledgment Agreement) solely to the
extent such actions are expressly permitted to be taken by the Buyer under the
Acknowledgment Agreement, and, without limiting the generality of the foregoing,
the Seller hereby gives the Buyer the power and right, on behalf of the Seller,
without assent by, but with notice to, the Seller, if an Event of Default shall
have occurred and be continuing, to do the following (subject to limitations
contained in the Acknowledgment Agreement):

(i)         in the name of the Seller or its own name, or otherwise, to take
possession of and endorse and collect any checks, drafts, notes, acceptances or
other instruments for the payment of moneys due under any mortgage insurance or
with respect to any other Repurchase Assets and to file any claim or to take any
other action or proceeding in any court of law or equity or otherwise deemed
appropriate by the Buyer for the purpose of collecting any and all such moneys
due under any such mortgage insurance or with respect to any other Repurchase
Assets whenever payable;

(ii)       (A) to direct any party liable for any payment under any Repurchase
Assets to make payment of any and all moneys due or to become due thereunder
directly to the Buyer or as the Buyer shall direct; (B) to ask or demand for,
collect, receive payment of and receipt for, any and all moneys, claims and
other amounts due or to become due at any time in respect of or arising out of
any Repurchase Assets; (C) to sign and endorse any invoices, assignments,
verifications, notices and other documents in connection with any of the
Repurchase Assets; (D) to commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Repurchase Assets or any part thereof and to enforce any other right
in respect of any Repurchase Assets; (E) in connection with the above, to give
such discharges or releases as the Buyer may deem appropriate; and
(F) generally, to sell, transfer, pledge and make any agreement with respect to
or otherwise deal with any of the Repurchase Assets as fully and completely as
though the Buyer were the absolute owner thereof for all purposes, and to do, at
the Buyer’s option and the Seller’s expense, at any time, or from time to time,
all acts and things which the Buyer deems necessary to protect, preserve or
realize upon the

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Repurchase Assets and the Buyer’s Liens thereon and to effect the intent of this
Agreement, all as fully and effectively as the Seller might do;

(iii)      in connection with the preservation of the security interest granted
hereunder in favor of the Buyer, perform or cause to be performed, the Seller’s
obligations under any Servicing Contract to the extent permitted by the
Acknowledgment Agreement.

The Seller hereby ratifies that all said attorneys shall lawfully do or cause to
be done by virtue hereof. The power of attorney is a power coupled with an
interest and shall be irrevocable but shall terminate upon release of the
Buyer’s security interest as provided in Section 4.05.

(b)        The Seller also authorizes the Buyer, at any time and from time to
time, to execute, in connection with the sale provided for in Section 8.02(c)
hereof, any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Repurchase Assets; provided that the exercise of
such powers are in accordance with the Acknowledgment Agreement.

(c)        The powers conferred on the Buyer are solely to protect the Buyer’s
interest in the Repurchase Assets and shall not impose any duty upon the Buyer
to exercise any such powers. The Buyer shall be accountable only for amounts
that it actually receives as a result of the exercise of such powers, and
neither the Buyer nor any of its officers, directors, or employees shall be
responsible to the Seller for any act or failure to act hereunder, except for
its own gross negligence or willful misconduct; provided that the Buyer shall
exercise such powers only to the extent expressly permitted in the
Acknowledgment Agreement.

Section 4.05    Release of Security Interest. Upon termination of this Agreement
and repayment to the Buyer of all Obligations and the performance of all
obligations under the Facility Documents, the Buyer shall release its security
interest in any remaining Repurchase Assets; provided that if any payment, or
any part thereof, of any of the Obligations is rescinded or must otherwise be
restored or returned by the Buyer upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Seller, or upon or as a result of the
appointment of a receiver, intervener or conservator of, or a trustee or similar
officer for the Seller or any substantial part of its Property, or otherwise,
this Agreement, all rights hereunder and the Liens created hereby shall continue
to be effective, or be reinstated, until such payments have been made.

Section 4.06    Participation Certificate.  Buyer acknowledges and agrees that
the Participation Interest evidenced by the Participation Certificate subject to
the rights of Fannie Mae under the Fannie Mae Servicing Contract and that the
Participation Certificate will include the following legend:

THE PARTICIPATION INTEREST (AS DEFINED IN THE PARTICIPATION AGREEMENT) EVIDENCED
BY THIS PARTICIPATION CERTIFICATE AND THE INTERESTS OF THE HOLDER THEREOF IN THE
PORTFOLIO EXCESS SPREAD IS SUBJECT AND SUBORDINATE TO ALL RIGHTS, POWERS, AND
PREROGATIVES OF THE FEDERAL NATIONAL MORTGAGE ASSOCIATION (“FANNIE MAE”) UNDER
AND IN CONNECTION WITH (I) THE TERMS AND CONDITIONS OF THAT CERTAIN
ACKNOWLEDGMENT AGREEMENT, BY AND AMONG FANNIE

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MAE, PENNYMAC LOAN SERVICES, LLC (THE “COMPANY”), AND CREDIT SUISSE AG, CAYMAN
ISLANDS BRANCH, AND (II) THE MORTGAGE SELLING AND SERVICING CONTRACT, THE FANNIE
MAE SELLING GUIDE, THE FANNIE MAE SERVICING GUIDE AND ANY SUPPLEMENTAL SERVICING
INSTRUCTIONS OR DIRECTIVES PROVIDED BY FANNIE MAE, ALL APPLICABLE MASTER
AGREEMENTS, RECOURSE AGREEMENTS, REPURCHASE AGREEMENTS, INDEMNIFICATION
AGREEMENTS, LOSS-SHARING AGREEMENTS, AND ANY OTHER AGREEMENTS BETWEEN FANNIE MAE
AND THE COMPANY, AND ALL AS AMENDED, RESTATED OR SUPPLEMENTED FROM TIME TO TIME
(COLLECTIVELY, THE “FANNIE MAE SERVICING CONTRACT”), WHICH RIGHTS INCLUDE,
WITHOUT LIMITATION, THE RIGHT OF FANNIE MAE TO TERMINATE THE FANNIE MAE LENDER
CONTRACT WITH OR WITHOUT CAUSE AND THE RIGHT TO SELL, OR HAVE TRANSFERRED, THE
SERVICING RIGHTS AS THEREIN PROVIDED.  THE HOLDER OF THE PARTICIPATION
CERTIFICATE’S INTEREST IN THE PORTFOLIO EXCESS SPREAD SHALL EXIST ONLY AS LONG
AS THE COMPANY’S FANNIE MAE SERVICING CONTRACT HAS NOT BEEN TERMINATED.

ARTICLE V

CONDITIONS PRECEDENT

Section 5.01    Conditions Precedent. The effectiveness of this Agreement is
subject to the condition precedent that the Buyer and the Administrative Agent
shall have received each of the items set forth in Schedule 5.01 (unless
otherwise indicated) dated such date, and in such form and substance, as is
satisfactory to the Buyer and the Administrative Agent.

Section 5.02    Further Conditions Precedent. The funding of the Purchase Price
hereunder in respect of each Transaction, shall in all events be subject to
satisfaction of the further conditions precedent set forth in Schedule 5.02 as
of the time such Transaction is entered into.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

Section 6.01     Representations and Warranties of Each Seller Party.  Each of
the Seller and the Guarantor, as applicable, represents and warrants to the
Buyer that throughout the term of this Agreement (except to the extent any such
representation or warranty is stated to relate solely to an earlier date, in
which case, such representation or warranty shall have been true or correct as
of such date):

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

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(b)        Licenses.  Each Seller Party 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.  Each Seller Party has the
requisite power and authority and legal right and necessary licenses to execute
and deliver, engage in the transactions contemplated by, and perform and observe
the terms and conditions of each Facility Document.  The Seller is an FHA
Approved Mortgagee.

(c)        Power.  Each Seller Party 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.

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

(e)        Financial Statements. The financial statements of each Seller Party,
copies of which have been furnished to the Buyer, (i) are, as of the dates and
for the periods referred to therein, complete and correct in all material
respects, (ii) present fairly the financial condition and results of operations
of the related Seller Party as of the dates and for the periods indicated and
(iii) have been prepared in accordance with GAAP consistently applied, except as
noted therein (subject as to interim statements to normal year-end adjustments).
Since the date of the most recent financial statements, there has been no
material adverse change in the consolidated business, operations or financial
condition of any Seller Party from that set forth in said financial statements
nor is any Seller Party aware of any state of facts which (with notice or the
lapse of time) would or could result in any such material adverse change. Except
as disclosed in such financial statements or pursuant to Section 7.01 hereof, no
Seller Party is subject to any 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.

(f)        Event of Default.  There exists no Event of Default under
Section 8.01(e) hereof, which default gives rise to a right to accelerate
indebtedness as referenced in Section 8.01(e) hereof.

(g)        Solvency. Each Seller Party is solvent and will not be rendered
insolvent by any Transaction hereunder and, after giving effect to each such
Transaction, will not be left with an unreasonably small amount of capital with
which to engage in its business.  No Seller Party

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intends 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 respect of such entity or any of its assets.  The amount of consideration
being received by the Seller after giving effect to each payment of the Purchase
Price by the Buyer constitutes reasonably equivalent value and fair
consideration for the related Repurchase Assets. The Seller is not pledging any
Repurchase Assets with any intent to hinder, delay or defraud any of its
creditors. The Agreement and the Facility Documents, any other document
contemplated hereby or thereby and each transaction have not been entered into
fraudulently by any Seller Party hereunder, or with the intent to hinder, delay
or defraud any creditor or the Buyer.

(h)        No Conflicts.  The execution, delivery and performance by each Seller
Party of each Facility Document does not conflict with any term or provision of
the organizational documents of the related Seller Party or result in the breach
of any provision of, or conflict with or constitute a default under or result in
the acceleration of any obligation under, any agreement, indenture, loan or
credit agreement or other instrument to which a Seller Party, the Repurchase
Assets or any of a Seller Party’s Property is or may be subject to, or result in
the violation of any law, rule, regulation, order, judgment, writ, injunction or
decree to which a Seller Party, the Repurchase Assets or a Seller Party’s
Property is subject, which conflict would have a Material Adverse Effect.

(i)         True and Complete Disclosure.  All information, reports, exhibits,
schedules, financial statements or certificates relating to any Seller Party
that any Seller Party has delivered or caused to be delivered to the Buyer in
connection with the initial or any ongoing due diligence of any Seller Party and
the negotiation, preparation, or delivery of the Facility Documents are true and
complete 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.

(j)         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 any Seller Party of each Facility Document except for
(i) consents that have been obtained in connection with transactions
contemplated by the Facility Documents, (ii) filings to perfect the security
interest created by this Agreement, and (iii) authorizations, consents,
approvals, filings, notices, or other actions the failure to make could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect.

(k)        Litigation.  There is no action, proceeding or investigation pending
with respect to which any Seller Party has received service of process or, to
the best of any Seller Party’s knowledge threatened against it before any court,
administrative agency or other tribunal (A) asserting the invalidity of any
Facility Document, (B) seeking to prevent the consummation of any of the
transactions contemplated by any Facility Document, (C) making a claim against
any Seller Party, individually or in the aggregate, in an amount greater than
five percent (5%) of Seller’s Adjusted Tangible Net Worth, (D) which requires
filing with the Securities and Exchange Commission 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

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as could adversely impact any Seller Party’s business or (F)  which might
materially and adversely affect the validity of the Repurchase Assets or the
performance by it of its obligations under, or the validity or enforceability of
any Facility Document.

(l)         Taxes.  Each Seller Party and its Subsidiaries is a U.S. Person and
has 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 each Seller Party and its Subsidiaries in respect of
taxes and other governmental charges are, in the opinion of the Seller or the
Guarantor, as applicable, adequate.

(m)       Investment Company.  Neither the Seller nor any of its Subsidiaries is
required to register as an “investment company”, or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act;
provided,  however, that any entity that is under the management of PNMAC
Capital Management LLC in its capacity as an “investment adviser” within the
meaning of the Investment Company Act and is otherwise not directly or
indirectly owned or controlled by the Seller shall not be deemed a “Subsidiary”
for the purposes of this Section 6.01(m).

(n)        Chief Executive Office; Jurisdiction of Organization.  The Seller’s
chief executive office on the date hereof is located at 3043 Townsgate Road,
Westlake Village, CA 91361.  The Seller’s jurisdiction of organization is the
State of Delaware.  The Seller shall provide the Buyer with thirty (30) days
advance notice of any change in the Seller’s principal office or place of
business or jurisdiction.  The Seller has no trade name.  During the preceding
five years, the 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.

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

(p)        Adjusted Tangible Net Worth.  On the Closing Date, the Seller’s
Adjusted Tangible Net Worth shall comply with the requirements set forth in
Section 7.01(v)(i) hereof.

(q)        ERISA.  Each Plan to which a Seller Party or its Subsidiaries makes
direct contributions, and, to the knowledge of a Seller Party, 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.

(r)        Agreements.  Neither the Seller nor any Subsidiary of the 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
6.01(e) hereof.  Neither the Seller nor any Subsidiary of the 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

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material adverse effect on the business, operations, properties, or financial
condition of the Seller as a whole.  No holder of any indebtedness of the Seller
or of any of its Subsidiaries has given notice of any asserted default
thereunder.

(s)        Seller’s Existing Financing Facilities.  Each of the Seller’s
financing facilities currently in place for the financing of any mortgage
servicing rights or servicing advances owned by the Seller is listed in detail
in Schedule 6.01(s) attached hereto as of the date set forth therein. The Seller
shall provide any updates to Schedule 6.01(s) to the Buyer at the time it
delivers each Compliance Certificate hereunder.

(t)         Agency Approvals.  The Servicer is a seller/servicer approved by
Fannie Mae and Freddie Mac, an issuer approved by Ginnie Mae and a Buyer
approved by HUD. The Servicer is in good standing to service mortgages for
Fannie Mae, Ginnie Mae, HUD and Freddie Mac, as applicable. The Servicer has not
been suspended as a seller/servicer by Fannie Mae, Freddie Mac, Ginnie Mae or
HUD on and after the date on which the Seller first obtained such approval from
Fannie Mae, Ginnie Mae, HUD or Freddie Mac, as applicable. No Seller Party is
under review or investigation outside of due course and does not have knowledge
of imminent or future investigation outside of due course, by Fannie Mae, Ginnie
Mae, HUD or Freddie Mac on and after the date on which such Seller Party became
a Fannie Mae, Ginnie Mae, HUD or Freddie Mac approved seller/servicer or lender,
as the context may require.

(u)        No Reliance.  Each Seller Party has made its own independent
decisions to enter into the Facility Documents, as applicable, and as to whether
each 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.  No Seller Party is relying upon
any advice from the Buyer as to any aspect of the Transactions, including
without limitation, the legal, accounting or tax treatment of such Transactions.

(v)        Plan Assets.  No Seller Party is 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 Repurchase Assets do not constitute “plan assets” within the
meaning of 29 CFR §2510.3 101 as amended by Section 3(42) of ERISA, in any
Seller Party’s hands, and transactions by or with a Seller Party 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.

(w)       No Prohibited Persons.  Neither the Seller nor the Guarantor, or any
of their Affiliates, officers, directors, partners or members, is an entity or
person (or to the Seller’s or the Guarantor’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”).

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(x)        Servicing.  The Seller has adequate financial standing and access to
adequate servicing facilities, procedures and experienced personnel necessary
for the sound servicing of the Mortgage Loans subject to this Agreement and in
accordance with Accepted Servicing Practices.

Section 6.02    Representations Concerning the Repurchase Assets.  The Seller
represents and warrants to the Buyer that as of each day that each Transaction
is entered into pursuant to this Agreement:

(a)        The Seller has not assigned, pledged, conveyed, or encumbered any
Repurchase Assets to any other Person or any right to any Repurchase Assets to
any Person other than to the Buyer (including without limitation any right to
control or transfer or otherwise effectuate any remedy relating to any
Repurchase Assets), and immediately prior to the pledge of any such Repurchase
Assets, the Seller was the sole owner of such Repurchase Assets and had good and
marketable title thereto (subject to the rights of Fannie Mae as more
specifically described in Section 4.02), free and clear of all Liens (subject
only to the rights and interests of Fannie Mae as more specifically described in
Section 4.02 and the Buyer’s rights under the Conventional MSR Loan Agreement
prior to removal of the Fannie Mae Servicing Rights from the collateral
thereunder), and no Person, other than the Buyer has any Lien on any Repurchase
Assets (subject only to the rights and interests of Fannie Mae as more
specifically described in Section 4.02). No Eligible Servicing Rights are
related to Mortgage Loans owned or financed by a third-party (including without
limitation any Affiliate of the Seller) other than Fannie Mae as more
specifically described in Section 4.02, and no Person has any interest in any
Eligible Servicing Rights or any related Mortgage Loans, other than the Buyer,
the Seller, Fannie Mae as more specifically described in Section 4.02 (including
without limitation any right to control or transfer or otherwise effectuate any
remedy relating to any Eligible Servicing Rights).

(b)        The provisions of this Agreement are effective to create in favor of
the Buyer a valid security interest in all right, title, and interest of the
Seller in, to and under the Repurchase Assets, subject only to the rights and
interests of Fannie Mae as more specifically described in Section 4.02.

(c)        All Recourse Servicing Obligations as of the applicable date of the
most recent Electronic File have been identified as such in a monthly summary
report delivered to the Buyer. All information concerning all Servicing Rights
set forth on the Electronic File pursuant to which such Servicing Rights were,
are or will be (as applicable) pledged to the Buyer will not contain any
material misstatement of fact or omit to state a material fact or any fact
necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading as of the date of such
Electronic File.

(d)        Upon the filing of financing statements on Form UCC-1 naming the
Buyer as “Secured Party” and the Seller as “Debtor”, and describing the
Repurchase Assets, in the appropriate jurisdictions, the Buyer has a duly
perfected first priority security interest under the UCC in all right, title,
and interest of the Seller in, to and under, subject to the rights and interests
of Fannie Mae under the Acknowledgment Agreement, the Repurchase Assets.

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(e)        The Facility Documents create in favor of the Buyer a valid and,
together with such filings and other actions, perfected first priority security
interest in the Repurchase Assets, securing the payment of the Obligations, and
all filings and other actions necessary to perfect such security interest have
been duly taken. Subject to the rights of Fannie Mae as more specifically
described in Section 4.02, the Seller is the legal and beneficial owner of the
Repurchase Assets free and clear of any Lien (subject to the rights and
interests of Fannie Mae as more specifically described in Section 4.02), except
for the Liens created or permitted under the Facility Documents.

(f)        Subject only to the terms of the Acknowledgment Agreement, the Seller
has and will continue to have the full right, power and authority, to pledge the
Servicing Rights, and the pledge of such Servicing Rights may be further
assigned without any requirement, except as may be specified in the Fannie Mae
Servicing Contract.

(g)        In connection with any repurchase agreement, loan and security
agreement or similar credit facility or agreement for borrowed funds entered
into by the Seller or any of its Affiliates on the one hand and any third party
(including an Affiliate of the Seller or any of its Affiliates but excluding the
Buyer or any Affiliate of the Buyer) on the other, including without limitation,
any other facility for the funding of Advances, no such third party has the
right pursuant to the terms of such repurchase agreement, loan and security
agreement or similar credit facility or agreement, to cause the Seller to
terminate, rescind, cancel, pledge, hypothecate, liquidate or transfer any of
the Repurchase Assets.

(h)        All representations and warranties on Schedules 6.02(h)(i) are true
and correct in all material respects.

ARTICLE VII

COVENANTS

Section 7.01    Covenants of the Seller.  The Seller covenants and agrees with
the Buyer that until all Obligations have been paid and satisfied in full:

(a)        Litigation.  Each Seller Party, as applicable, will promptly, and in
any event within ten (10) days after service of process on any of the following,
give to the 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 such
Seller Party 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 Facility Documents 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 five percent
(5%) of Seller’s Adjusted Tangible Net Worth, or (iii) which, individually or in
the aggregate, if adversely determined, could be reasonably likely to have a
Material Adverse Effect.  Each Seller Party, as applicable, will promptly
provide notice of any judgment, which with the passage of time, could cause an
Event of Default hereunder.

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(b)        Prohibition of Fundamental Changes.  No Seller Party shall enter into
any transaction of merger (including a divisive merger whereby a limited
liability company is divided into two or more limited liability companies (a
“Divisive 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, including as a result of a Divisive
Merger; provided, that such Seller Party may merge or consolidate with (a) any
wholly owned subsidiary of such Seller Party, or (b) any other Person if such
Seller Party is the surviving corporation; and provided further, that if after
giving effect thereto, no Default would exist hereunder.

(c)        Servicing.  No Seller Party shall cause the Mortgage Loans to be
serviced by any servicer other than the Servicer without the consent of the
Buyer, which consent shall not be unreasonably withheld, subject to the rights
and interest of Fannie Mae; provided,  however, that the consent of the Buyer
shall not be required if either (i) Fannie Mae terminates a Seller Party as
servicer or subservicer, as applicable, or (ii) Fannie Mae directs the Seller
Party to cause the Mortgage Loans to be serviced by another servicer, and in
each case, such successor servicer shall be an approved servicer under the
guidelines of Fannie Mae.

(d)        Insurance.  The Seller shall, and shall cause the Guarantor to keep
all property useful and necessary in its business in good working order and
condition. The Seller shall maintain a fidelity bond and be covered by insurance
(including, without limitation, errors and omissions insurance) of the kinds and
in the amounts customarily maintained by such similarly situated entities in the
same jurisdiction and industry as the Seller, in amounts acceptable to the
Agencies, and the Seller shall not reduce such coverage without the written
consent of the Buyer, and shall also maintain such other insurance with
financially sound and reputable insurance companies, and with respect to
property and risks of a character usually maintained by entities engaged in the
same or similar business similarly situated, against loss, damage and liability
of the kinds and in the amounts customarily maintained by such entities.

(e)        No Adverse Claims.  The Seller warrants and will defend the right,
title and interest of the Buyer in and to the Servicing Rights pledged to the
Buyer against the claims and demands of all Persons whomsoever, subject to the
restrictions imposed by the Acknowledgment Agreement to the extent that such
restrictions are valid and enforceable under the applicable UCC and other
Requirements of Law.

(f)        Assignment.  Except as permitted herein, the 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 Facility Documents), any of the Repurchase
Assets or any interest therein subject to the Acknowledgment Agreement, except
(x) the security interest granted hereunder in favor of the Buyer and (y) the
rights of Fannie Mae under the Servicing Contracts and the Fannie Mae Guide.

(g)        Security Interest.  The Seller shall do all things necessary to
preserve the Repurchase Assets so that it remains subject to a first priority
perfected security interest hereunder subject to the rights of Fannie Mae under
the Servicing Contracts and the Fannie Mae Guide. Without limiting the
foregoing, the Seller will comply with all rules, regulations and other laws of
any Governmental Authority and cause the Repurchase Assets to comply with all
applicable rules, regulations and other laws. Each Seller Party and any
Subservicer shall diligently fulfill its duties

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and obligations under the Servicing Contracts and the Subservicing Agreement in
all material respects and shall not default in any material respect under any of
the Servicing Contracts, Subservicing Agreement or the Acknowledgment Agreement;
provided that it shall not be a breach of this covenant if: (a) Fannie Mae shall
terminate the Seller’s rights under any Servicing Contract and the Seller shall
repay (without duplication of payment) to the Buyer an amount equal to the
excess of the sum of the Repurchase Price then outstanding over the sum of the
Asset Base of all the Servicing Rights then pledged to the Buyer within the time
periods set forth in Section 2.07 or (b) any such Servicing Contract expires in
accordance with its terms and without renewal or (c) a default declared by
Fannie Mae in respect of a Servicing Contract arose from a failure of the
portfolio of serviced Mortgage Loans to perform as required by the related
Servicing Contract and Fannie Mae has elected in writing to continue to use the
Seller as servicer of both that portfolio and other pools of Mortgage Loans and
individual Mortgage Loans and Fannie Mae has not rescinded or revoked such
election.

(h)        Records:

(1)        The Seller shall collect and maintain or cause to be collected and
maintained all records relating to the Repurchase Assets in accordance with
industry custom and practice for assets similar to the Repurchase Assets, and
all such records shall be in the Seller’s or any Subservicer’s possession unless
the Buyer otherwise approves.  The Seller or any Subservicer will maintain all
such records in good and complete condition in accordance with industry
practices for assets similar to the Repurchase Assets and preserve them against
loss.

(2)        Upon reasonable advance notice from the Buyer, the Seller shall (x)
make any and all records relating to the Pledged Servicing Rights and any
Subservicer, any Seller Party and the other Repurchase Assets in the possession
of the Seller or any Subservicer available to the Buyer to reasonably examine
during normal business hours, 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 the Buyer or its authorized agents to discuss the affairs,
finances and accounts of the Seller Parties with its chief operating officer and
chief financial officer and to discuss the affairs, finances and accounts of the
Seller Parties with its independent certified public accountants; provided,
however, the foregoing shall not apply with respect to any information that the
Seller or any Subservicer are required by an Agency to keep confidential.

(i)         Books.  Each Seller Party shall keep or cause to be kept in
reasonable detail records and books of account of its assets and business, in
which complete entries will be made in accordance with GAAP consistently
applied.

(j)         Approvals.  Except as would not be reasonably likely to have a
Material Adverse Effect or would have a material adverse effect on the
Repurchase Assets or the Buyer’s interest therein, each Seller Party shall
maintain all licenses, permits or other approvals necessary for such Seller
Party to conduct its business and to perform its obligations under the Facility
Documents, and such Seller Party shall conduct its business in all material
respects in accordance with applicable law.

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(k)        Material Change in Business.  No Seller Party shall make any material
change in the nature of its business as carried on at the date hereof.

(l)         Distributions.  If an Event of Default has occurred and has not been
waived by the Buyer in accordance herewith, no Seller Party shall make any
Restricted Payments.

(m)       Applicable Law.  Each Seller Party shall comply with all applicable
Requirements of Law if the failure to comply with such Requirements of Law could
reasonably be expected to have a Material Adverse Effect.

(n)        Existence.  Each Seller Party shall preserve and maintain its legal
existence and all of its material rights, privileges, licenses and franchises.

(o)        Chief Executive Office; Jurisdiction of Organization.  The Seller
shall not move its chief executive office from the address referred to in
Section 6.01(n) or change its jurisdiction of organization from the jurisdiction
referred to in Section 6.01(a) unless it shall have provided the Buyer with
thirty (30) days’ prior written notice of such change.

(p)        Taxes.  Each Seller Party is a U.S. Person and 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.

(q)        Transactions with Affiliates.  The 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 is (i) otherwise permitted under the Facility Documents and
will not result in a Default hereunder, (ii) in the ordinary course of Seller’s
business and (iii) upon fair and reasonable terms no less favorable to the
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 to any Affiliate.

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

(s)        Indebtedness.  The Seller shall not incur any additional material
Indebtedness (other than (i) the Indebtedness specified on Schedule 6.01(s)
hereto; (ii) usual and customary accounts payable for a mortgage company; (iii)
Indebtedness incurred in connection with new or existing secured lending
facilities; and (iv) Indebtedness incurred in connection with an intercompany
lending agreement) without the prior written consent of the Buyer.  The Seller
shall not enter into any other financing facility with a buyer other than the
Buyer to provide for the financing of Fannie Mae Servicing Rights.

(t)         True and Correct Information.  All information, reports, exhibits,
schedules, financial statements or certificates relating to any Seller Party
that any Seller Party has furnished to the Buyer hereunder and during the
Buyer’s diligence of each Seller Party are and will be true

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and complete 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 required financial statements, information and
reports delivered by each Seller Party to the Buyer pursuant to this Agreement
shall be prepared in accordance with GAAP, or, if applicable, to SEC filings,
the appropriate SEC accounting regulations.

(u)        Agency Approvals; Servicing.  The Seller shall maintain its status
with Fannie Mae as an approved lender and Freddie Mac as an approved
seller/servicer, in each case in good standing (“Agency Approvals”).  Servicer
shall service all Mortgage Loans in accordance with the Fannie Mae
Guide.  Should Servicer, for any reason, cease to possess all such applicable
Agency Approvals, or should notification to the relevant Agency or to HUD, FHA
or VA be required, such Seller shall so notify the Buyer immediately in
writing.  Notwithstanding the preceding sentence, Servicer shall take all
necessary action to maintain all of their applicable Agency Approvals at all
times during the term of this Agreement and until the Seller’s Obligations
hereunder have been paid and satisfied in full. The Servicer shall maintain
adequate financial standing, servicing facilities, procedures and experienced
personnel necessary for the sound servicing of mortgage loans of the same types
as may from time to time constitute Mortgage Loans and in accordance with
Accepted Servicing Practices.

(v)        Plan Assets.  No Seller Party shall 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 the 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. Transactions by or with the Seller or the Guarantor 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.

(w)       Financial Covenants.  The Seller shall at all times comply with any
financial covenants and/or financial ratios set forth below:

(i)         Adjusted Tangible Net Worth.  The Seller shall maintain an Adjusted
Tangible Net Worth of at least equal to $500,000,000.

(ii)       Indebtedness to Adjusted Tangible Net Worth Ratio.  The Seller’s
ratio of Indebtedness (excluding (A) Non-Recourse Debt, including any
securitization debt, and (B) any intercompany debt eliminated in consolidation)
to Adjusted Tangible Net Worth shall not exceed 10:1.

(iii)      Maintenance of Liquidity.  The Seller shall ensure that, at all
times, it has cash (other than Restricted Cash) and Cash Equivalents in an
amount not less than $40,000,000.

(x)        Changes in Servicing Contracts.  The Seller shall provide written
notice to the Buyer of any changes in any Servicing Contracts that may
materially affect the Servicing Rights within three (3) Business Days after the
Seller receives notice thereof.

(y)        Monthly Third Party Valuation Reports.  As soon as possible and in
any event no later than the twenty-third (23rd) calendar day of each calendar
month (or, if such day is not a Business Day, the following Business Day), the
Seller shall provide to the Buyer a report

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provided by a third party valuation agent acceptable to the Buyer setting forth
such agent’s determination of the value of all of the Seller’s servicing rights
(including Eligible Servicing Rights and servicing rights not subject to this
Agreement) and cash flows, along with the appropriate certificate required under
Section 7.01(z)(iii).

(z)        Financial Statements.  The Seller shall deliver to the Buyer, in each
case, to the extent not publicly filed:

(i)         Within forty (40) days after the end of each month, consolidated
unaudited balance sheets and consolidated statements of income and changes in
equity and unaudited statement of cash flows, all to be in a form acceptable to
the Buyer, showing the financial condition and results of operations of the
Seller and its consolidated Subsidiaries on a consolidated basis as of the end
of each such month and for the then elapsed portion of the fiscal year, setting
forth, certified by a financial officer of the Seller (acceptable to the Buyer)
as presenting fairly the financial position and results of operations of the
Seller and its consolidated Subsidiaries and as having been prepared in
accordance with GAAP consistently applied, in each case, subject to normal
year-end audit adjustments;

(ii)       Within ninety (90) days after the end of each fiscal year of the
Seller, the consolidated audited balance sheets of the Seller and its
consolidated Subsidiaries, which will be in conformity with GAAP, and the
related consolidated audited statements of income and changes in equity showing
the financial condition of the Seller and its consolidated Subsidiaries as of
the close of such fiscal year and the results of operations during such year,
and consolidated audited statements of cash flows, as of the close of such
fiscal year, setting forth, in each case, in comparative form the corresponding
figures for the preceding year. The foregoing consolidated financial statements
are to be reported on by, and to carry the unqualified report (acceptable in
form and content to the Buyer) of, an independent public accountant of national
standing acceptable to the Buyer and are to be accompanied by a letter of
management in form and substance acceptable to the Buyer; and

(iii)      Together with each set of the financial statements delivered pursuant
to clause (i) above, a certificate of a Responsible Officer in the form attached
as Exhibit A to the Pricing Side Letter, provided the requirement to deliver
such certificate hereunder can be satisfied with the certificate of a
Responsible Officer of the Seller delivered pursuant to Section 17 of the Repo
Agreement.

(aa)      Notice of Disposal of Servicing Rights.  In the event that the Seller
sells or otherwise disposes of any of the Pledged Servicing Rights, it shall
give the Buyer ten (10) Business Days’ prior written notice of such sale or
disposition (together with a list of the affected loans and

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other information helpful to the Buyer in assessing the related Asset Value),
during which time the Buyer shall recalculate the Asset Value for the Repurchase
Assets remaining after such sale or disposition.

(bb)      Requests for Information.  The Seller shall furnish to the Buyer
within five (5) Business Days after the Buyer’s request, any information,
documents, records or reports with respect to the servicing or subservicing of
the Repurchase Assets, any Seller Party’s business or its relationship with any
Agency, as the Buyer may from time to time reasonably request.

(cc)      Monthly Reports.  No later than the time set forth in Section
7.01(z)(i), the Seller shall provide to the Buyer (i) reports of information
related to (x) any claims or compensatory fees actually paid by the Seller or
the Guarantor to each Agency related to enforcement by such Agency of its rights
under the related Agency Guide (or to trusts under non-agency securitizations)
that are not reimbursed from a predecessor originator/servicer, (y) a summary
report of claims for repurchases or indemnity made by Agencies, insurers or
trusts in non-agency securitizations, including the current status or resolution
of such repurchase and indemnification demands; (z) the Repurchase Assets as
detailed in Schedule 7.01(bb); (ii) a report provided by the Seller setting
forth the Seller’s determination of the value of all of the Seller’s servicing
rights (including servicing rights not subject to this Agreement) and cash
flows, along with the appropriate certificate required under Section
7.01(z)(iii); and (iii) copies of all notices it receives from any Agency that
materially affect the Eligible Servicing Rights.

(dd)      Subservicer Acknowledgment Letter.  Subject to the rights and
interests of Fannie Mae, if the Buyer approves the use of a subservicer, the
Seller shall cause such subservicer to acknowledge the Buyer’s rights hereunder
and agree to follow all instructions of the Buyer upon the occurrence of a
default hereunder, which side letter shall be acceptable to the Buyer in form
and substance (such side letter, a “Subservicer Acknowledgment Letter”) and
prior to permitting any other subservicer to service any Mortgage Loans related
to the Eligible Servicing Rights pledged hereunder, the Seller shall cause such
subservicer to become a party to a Subservicer Acknowledgment Letter.

(ee)      Collections on Assets and the Dedicated Account.

(i)         Except as permitted under Section 7.01(ee)(ii), prior to the Seller
making any withdrawal from the custodial account or any other clearing account
maintained under the Servicing Contract, the Seller shall instruct the related
depository institution to remit all Collections and other payments and proceeds
in respect of MSRs, including the Excess Spread, to the Dedicated Account (but
only to the extent that such funds are payable to the Seller free and clear of
any Fannie Mae rights or other restrictions on transfer set forth in such
Servicing Contract).  Except as permitted under Section 7.01(ee)(ii), the Seller
shall not withdraw or direct the withdrawal or remittance of any Collections
from any custodial account into which such amounts have been deposited other
than to remit to the Dedicated Account.

(ii)       So long as no Event of Default has occurred hereunder, the Seller
shall be permitted to withdraw or direct the withdrawal or remittance of any
amounts which have been or are to be deposited into the Dedicated Account.  On
and after the occurrence of an Event of Default as notified to the Seller by the
Administrative Agent,  the Seller shall be required to

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deposit or cause to be deposited all amounts constituting Collections and
payments and proceeds of Assets (including, without limitation, all fees and
proceeds of sale) in the Dedicated Account in accordance with the requirements
set forth in Section 7.01(ee)(i) without exercising any right to withdraw or
direct the withdrawal or remittance of any Collections with respect to the
Dedicated Account.

(iii)      The Seller shall be permitted to retain the Base Servicing Fee and
Ancillary Income at all times.

(ff)       No Pledge.  Except as contemplated herein, neither the Seller nor the
Guarantor shall (a) pledge, transfer or convey any security interest in the
Dedicated Account to any Person without the express written consent of the Buyer
or (b) pledge, grant a security interest or assign any existing or future rights
to service any of the Repurchase Assets or to be compensated for servicing any
of the Repurchase Assets, or pledge or grant to any other Person any security
interest in any Assets or Servicing Contract.

Section 7.02    Notice of Certain Occurrences.  The Seller covenants and agrees
with the Buyer that until all Obligations have been paid and satisfied in full:

(a)        Defaults.  The Seller shall promptly, and in any event within one (1)
Business Day of knowledge thereof by a Responsible Officer of the Seller, inform
the Buyer in writing of any Default, Event of Default by the Seller or any other
Person (other than the Buyer or Affiliates of the Buyer) of any material
obligation under any Facility Document, or the occurrence or existence of any
event or circumstance that the Seller reasonably expects will with the passage
of time become a Default, Event of Default by the Seller or any other Person.

(b)        Litigation.  The Seller shall promptly inform the Buyer in writing of
the commencement of, or any determination in, any dispute, litigation,
investigation, proceeding, sanctions or suspension between the Seller, on the
one hand, and any Governmental Authority (or any other Person, on the other,
with an amount in controversy equal to or greater than five percent (5%) of
Seller’s Adjusted Tangible Net Worth).

(c)        Material Adverse Effect on Repurchase Assets.  As soon as possible,
the Seller shall inform the Buyer in writing upon the Seller becoming aware of
any default related to any Repurchase Assets which should reasonably be expected
to have a Material Adverse Effect.

(d)        Credit Default.  Unless otherwise disclosed by the Guarantor on Form
8-K with separate notice by the Seller to the Buyer of the filing of such Form
8-K, upon, and in any event within five (5) Business Days after, the Seller
shall furnish the Buyer notice of the involuntary termination, acceleration,
maturity of or reduction in the amount available for borrowing under any
repurchase agreement, loan and security agreement or similar credit facility or
agreement for borrowed funds entered into by a Seller Party and any third party
to the extent that such agreement or facility, prior to the effectiveness of
such termination, acceleration, maturity or reduction in the amount available
for borrowing, provides for a minimum amount available for borrowing by such
Seller Party equal to or greater than $10,000,000.

(e)        Servicing Contract Transfer.  As soon as possible, the Seller shall
inform the Buyer in writing of the transfer, expiration without renewal,
termination or other loss of all or

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any part of any Servicing Contract (or the termination or replacement of the
Seller thereunder), the reason for such transfer, loss or replacement, if known
to it and the effects that such transfer, loss or replacement will have (or will
likely have) on the prospects for full and timely collection of all amounts
owing to the Seller under or in respect of the Seller’s Servicing Contracts.

(f)        Agency Notices.  The Seller shall promptly furnish the Buyer copies
of all notices it receives from Fannie Mae, Freddie Mac, HUD or Ginnie Mae
indicating any adverse fact or circumstance in respect of the Seller with
respect to which adverse fact or circumstance Fannie Mae, Freddie Mac, HUD or
Ginnie Mae, respectively, announces its intention to terminate or threatens to
terminate the Seller with cause or with respect to which Fannie Mae, Freddie
Mac, HUD or Ginnie Mae, announces its intention to conduct any inspection or
investigation of the Seller, or their files or facilities outside of the
ordinary course.

(g)        Servicing Rights Notices.  The Seller shall provide copies of (i) all
notices it receives from any Agency that materially affect the Eligible
Servicing Rights and (ii) any demand by an Agency or an insurer for the
repurchase of or indemnification with respect to a mortgage loan and the reason
for such repurchase or indemnification within three (3) Business Days after the
Seller receives notice thereof, if such demand would likely cause a Material
Adverse Effect.

(h)        Servicer Rating.  The Seller shall provide written notice to the
Buyer within two (2) Business Days of receipt of notice of any decrease in any
servicer rating of the Servicer below (i) “SQ3”, as rated by Moody’s or (ii)
“Average”, as rated by S&P.

(i)         Other.  The Seller shall furnish, or cause to be furnished, upon the
request of the Buyer, such other information or reports as the Buyer may from
time to time reasonably request.

(j)         Agency Requirements.  The Seller shall provide written notice of any
change in any Agency’s requirements regarding the Seller’s or Servicer’s minimum
consolidated tangible net worth or any change in such Agency’s requirements
regarding the Seller’s or the Servicer’s consolidated liquidity within five (5)
Business Days after the Seller receives notice thereof.

(k)        Amendment to any Servicing Contract or the Subservicing
Agreement.  The Seller shall provide written notice to the Buyer within five (5)
Business Days after the Seller enters into any amendment to the terms of any
Servicing Contract.  The Seller shall not allow a subservicer to enter into any
amendment of the Servicing Contracts or a Subservicing Agreement that would
affect such subservicer’s servicing of the Mortgage Loans subject to this
Agreement without the prior written consent of the Buyer and subject to the
rights and interests of the Agencies.

(l)         Subservicer Termination.  The Seller shall provide written notice to
the Buyer within one (1) Business Day following the occurrence of a Subservicer
Termination Event.

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ARTICLE VIII

EVENTS OF DEFAULT

Section 8.01    Events of Default. The following events shall be “Events of
Default”:

(a)        The Seller or the Guarantor shall fail to (i) make any payment or
deposit to be made by it under Article II,  Section 3.01 or Section 8.02(d) when
due (whether of Repurchase Price or Price Differential at stated maturity, upon
acceleration or at mandatory prepayments due to Margin Deficit or otherwise) or
(ii) make any other payment or deposit to be made by it hereunder when due and,
solely with respect to this clause (ii), such failure (other than with respect
to payment of principal) shall continue unremedied for a period of two (2)
Business Days;

(b)        A Seller Party shall fail to comply with the requirements of
Sections 7.01(n),  7.01(g) or 7.02(e) and such default shall continue unremedied
for a period of one (1) Business Day; or a Seller Party shall otherwise fail to
observe or perform any other agreement contained in this Agreement or any other
Facility Document and such failure to observe or perform shall continue
unremedied for a period of five (5) Business Days following a Seller Party
obtaining knowledge thereof;

(c)        Any representation, warranty or certification made or deemed made
herein or in any other Facility Document by a Seller Party or any certificate
furnished to the Buyer pursuant to the provisions thereof, shall prove to have
been false or misleading in any material respect as of the time made or
furnished (other than the representations and warranties set forth in
Section 6.02 which shall be considered solely for the purpose of determining the
Asset Value of the Eligible Servicing Rights; unless (i) Seller Party shall have
made any such representations and warranties with knowledge that they were
materially false or misleading at the time made or (ii) any such representations
and warranties have been determined by the Buyer in its reasonable discretion to
be materially false or misleading on a regular basis);

(d)        (1) The failure of the Seller to be an approved servicer under the
guidelines of Fannie Mae with respect to which any Eligible Servicing Rights
pledged under this Agreement relate, (2) the Seller fails to service or
subservice, as applicable, in accordance with the Agency Guides and the Buyer
determines in its good faith discretion that such failure may have a Material
Adverse Effect, (3) the Seller is terminated as servicer or subservicer, as
applicable, with respect to any Eligible Servicing Rights by Fannie Mae (except
if the provisions of Section 7.01(g)(a)-(c) are met), (4) the Seller shall at
any time be terminated, revoked or suspended as servicer or subservicer, as
applicable, with respect to any whole loan servicing or subservicing rights that
make up a material portion of the Seller’s servicing portfolio, (5) the Seller
shall cease to be approved by or its approval shall be revoked, suspended,
rescinded, halted, eliminated, withdrawn, annulled, repealed, voided or
terminated by an Agency as an approved seller/servicer or lender, (6) all or a
portion of a Seller Party’s or Servicer’s servicing or subservicing portfolio
consisting of Agency loans is seized, (7) any Agency shall at any time cease to
accept delivery of any loan or loans from the Seller under any program or
notifies the Seller that the Agency shall cease accepting loan deliveries from
the Seller, and (8) receipt by a Seller Party of a notice from any Agency
indicating material breach, default or material non-compliance by such Seller
Party which the Buyer reasonably determines may entitle such Agency to terminate
such Seller Party which notice

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has not been rescinded or nullified within three (3) Business Days of its
receipt by such Seller Party or such lesser time as the Buyer believes is
necessary to protect its interest and provides the Seller with written notice
thereof, as the case may be.

(e)        Any “event of default” which constitutes a payment default shall have
occurred and shall be continuing beyond the expiration of any applicable grace
period under the terms of any repurchase agreement, loan and security agreement
or similar credit facility or agreement for borrowed funds entered into by the
Seller or any of its Affiliates on the one hand and any third party (including
an Affiliate of the Seller but excluding the Buyer or any Affiliate of the
Buyer), which relates to the Indebtedness of the Seller or any of its Affiliates
in an amount individually or in the aggregate greater than $10,000,000, which
default (1) involves the failure to pay a matured obligation or (2) permits the
acceleration of the maturity of obligations by such third party;

(f)        The Buyer does not, or ceases to, have a first priority perfected
security interest in the Repurchase Assets or any material part thereof, subject
only to the rights and interests of Fannie Mae with respect to the Fannie Mae
Servicing Rights and other Repurchase Assets, other than as a result of a
release of such security interest by the Buyer and such default continues
unremedied for a period of one (1) Business Day after the earlier of (i) a
Responsible Officer of the Seller or the Guarantor having actual knowledge
thereof and (ii) written notice of such default from the Buyer;

(g)        A Change of Control of the Seller or the Guarantor occurs;

(h)        The Seller ceases to be (1) a HUD approved mortgagee pursuant to
Section 203 of the National Housing Act or (2) a Fannie Mae or Freddie Mac
approved servicer or HUD, Fannie Mae or Freddie Mac, as applicable, suspends,
rescinds, halts, eliminates, withdraws, annuls, repeals, voids or terminates the
status of the Seller as either (1) a HUD approved mortgagee pursuant to
Section 203 of the National Housing Act or (2) a Fannie Mae or Freddie Mac
approved servicer or (B) the Seller receives notice that HUD, Fannie Mae or
Freddie Mac may take such action set forth in clause (A);

(i)         The Seller shall fail to comply with the financial covenants set
forth in Section 7.01(w);

(j)         The failure of the Seller to maintain any Agency’s net worth
requirements;

(k)        Any judgment or order for the payment of money in excess of five
percent (5%) of Seller’s Adjusted Tangible Net Worth shall be rendered against
the Seller or any of its Affiliates, by a court, administrative tribunal or
other body having jurisdiction over them and the same shall not be satisfied or
discharged (or provisions shall not be made for such discharge) or bonded, or a
stay of execution thereof shall not be procured, within sixty (60) days from the
date of entry thereof or, if a stay of execution is procured, sixty (60) days
from the date such stay is lifted;

(l)         (1) The Seller or any of its Affiliates files a voluntary petition
in bankruptcy, seeks relief under any provision of any Insolvency Law or
consents to the filing of any petition against it under any such law; (2) a
proceeding shall have been instituted by any Affiliate of the

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Seller in a court having jurisdiction in the premises seeking a decree or order
for relief in respect of the Seller or such Affiliate in an involuntary case
under any applicable Insolvency Law, or for the appointment of a receiver,
liquidator, assignee, trustee, custodian, sequestrator, conservator or other
similar official of the Seller or such Affiliate, or for any substantial part of
its Property, or for the winding-up or liquidation of its affairs, (3) a
proceeding shall have been instituted by any Person (other than an Affiliate of
the Seller) in a court having jurisdiction in the premises seeking a decree or
order for relief in respect of the Seller or any of its Affiliates in an
involuntary case under any applicable Insolvency Law, or for the appointment of
a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator
or other similar official of the Seller or such Affiliate, or for any
substantial part of its Property, or for the winding-up or liquidation of its
affairs and the Seller or such Affiliate shall have failed to obtain a relief
(including, without limitation, a dismissal) or a stay of such involuntary
proceeding within sixty (60) days, (4) the admission in writing by the Seller or
any of its Affiliates of its inability to pay its debts as they become due,
(5) the Seller or any of its Affiliates consents to the appointment of or taking
possession by a custodian, receiver, conservator, trustee, liquidator,
sequestrator or similar official, of all or any part of its Property or any
custodian, receiver, conservator, trustee, liquidator, sequestrator or similar
official takes possession of all or any part of the Property of the Seller or
any of its Affiliates; (6) the Seller or any of its Affiliates makes an
assignment for the benefit of any of its creditors; or (7) the Seller or any of
its Affiliates generally fails to pay its debts as they become due;

(m)       Any Governmental Authority or any Person, agency or entity acting or
purporting to act under Governmental Authority (including any Agency) 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 the Seller or any of
its Affiliates, or shall have taken any action to displace the management of any
of the Seller or any of its Affiliates or to curtail the Seller’s, or any of its
Affiliates’ authority in the conduct of its business; or

(n)        The Guarantor repudiates, revokes or attempts to revoke in writing
the guaranty of the Guarantor set forth in Section 11.13 of this Agreement, in
whole or in part.

(o)        Except as permitted under Section 7.01(ee),  the Seller or any other
Person shall have withdrawn any amounts on deposit in the Dedicated Account
without the consent of the Buyer other than funds deposited or withdrawn in
error.

Section 8.02    Remedies.

(a)        Optional Acceleration.  Upon the occurrence of an Event of Default
(other than an Event of Default described in Section 8.01(l)), the Buyer may by
written notice to the Seller, terminate the MSR PC Repo Facility and declare the
Termination Date to have occurred and all other Obligations to be immediately
due and payable.

(b)        Automatic Acceleration.  Upon the occurrence of an Event of Default
described in Section 8.01(l), the MSR PC Repo Facility shall be automatically
terminated and all Obligations shall be immediately due and payable upon the
occurrence of such event, without demand or notice of any kind.

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(c)        Remedies.  Upon any acceleration of the Obligations pursuant to this
Section 8.02, the Buyer, in addition to all other rights and remedies under this
Agreement or otherwise, shall have all other rights and remedies provided under
the UCC of each applicable jurisdiction and other applicable laws, which rights
shall be cumulative. The Seller agrees, upon the occurrence of an Event of
Default and notice from the Buyer, to assemble, at its expense, all of the
Repurchase Assets that is in its possession (whether by return, repossession, or
otherwise) at a place designated by the Buyer. All out-of-pocket costs incurred
by the Buyer in the collection of all Obligations, and the enforcement of its
rights hereunder, including reasonable attorneys’ fees and legal expenses, shall
be paid out of the Repurchase Assets. Without limiting the foregoing, upon the
occurrence of an Event of Default and the acceleration of the Obligations
pursuant to this Section 8.02, the Buyer may, to the fullest extent permitted by
applicable law, without notice, advertisement, hearing or process of law of any
kind, (i) enter upon any premises where any of the Repurchase Assets which are
in the possession of the Seller (whether by return, repossession, or otherwise)
may be located and take possession of and remove such Repurchase Assets,
(ii) sell any or all of such Repurchase Assets, free of all rights and claims of
the Seller therein and thereto, at any public or private sale, and (iii) bid for
and purchase any or all of such Repurchase Assets at any such sale. Any such
sale shall be conducted in a commercially reasonable manner and in accordance
with applicable law. The Seller hereby expressly waives, to the fullest extent
permitted by applicable law, any and all notices, advertisements, hearings or
process of law in connection with the exercise by the Buyer of any of its rights
and remedies upon the occurrence of an Event of Default. Each of the Buyer and
the Seller shall have the right (but not the obligation) to bid for and purchase
any or all Repurchase Assets at any public or private sale. The Seller hereby
agrees that in any sale of any of the Repurchase Assets, the Buyer is hereby
authorized to comply with any limitation or restriction in connection with such
sale as it may be advised by counsel is necessary in order to avoid any
violation of applicable law (including, without limitation, compliance with such
procedures as may restrict the number of prospective bidders and purchasers,
require that such prospective bidders and purchasers have certain
qualifications, and restrict such prospective bidders and purchasers to Persons
who will represent and agree that they are purchasing for their own account for
investment and not with a view to the distribution or resale of such Repurchase
Assets), or in order to obtain any required approval of the sale or of the
purchaser by any Governmental Authority, and the Seller further agrees that such
compliance shall not result in such sale being considered or deemed not to have
been made in a commercially reasonable manner. The Buyer shall not be liable for
any sale, private or public, conducted in accordance with this Section 8.02(c).
If an Event of Default occurs, and upon acceleration of the Obligations
hereunder, all Obligations shall be immediately due and payable, and collections
on the Eligible Servicing Rights and proceeds of sales and securitizations of
Eligible Servicing Rights, and other Repurchase Assets will be used to pay the
Obligations.

(d)        In the event that the Seller receives a notice from an Agency
indicating a material breach, material default or material non-compliance by the
Seller that the Buyer reasonably determines may entitle such Agency to terminate
the Seller, which breach, default or non-compliance has not been satisfactorily
cured or remedied within ten (10) Business Days of the receipt by the Seller of
such notice, or such lesser time as the Buyer believes is necessary to protect
its interest and provides the Seller with written notice thereof, as the case
may be, the Buyer may by written notice to the Seller, terminate the MSR PC Repo
Facility and declare all Obligations to be immediately due and payable.

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Section 8.03    Application of Proceeds.  On each Business Day during which an
Event of Default has occurred and is continuing hereunder, the Buyer shall apply
Collections in the following order to pay:

(i)         to the Buyer, any fees due pursuant to the terms hereof;

(ii)       to the Buyer or any Indemnified Party an amount equal to any other
amounts (including the outstanding aggregate Repurchase Price) then due to such
Persons pursuant to this Agreement that have not been paid by the Seller (and to
the extent that there are insufficient funds to pay all of the foregoing
amounts, such amount shall be distributed to the foregoing parties, pro rata in
accordance with the amounts due to such parties); and

(iii)      any remaining amounts to the Seller by transferring such amount to
the account specified in writing by the Seller.

ARTICLE IX

ASSIGNMENT

Section 9.01    Restrictions on Assignments; Register.  (a) The Seller shall not
assign its rights hereunder or any interest herein without the prior written
consent of the Buyer. The 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; subject, however, to
the Buyer’s obligations to transfer Purchased Assets to Seller (and not
substitutions thereof) pursuant to the terms of this Agreement.  In addition,
Buyer may assign any or all of its rights and its obligations, under this
Agreement or under the other Facility Documents, (i) without consent of the
Seller, to (a) any Affiliate of the Buyer or a conduit or other entity supported
by the Buyer or an Affiliate of the Buyer, or (b) following an Event of Default,
and (ii) with the Seller’s prior written consent (not to be unreasonably
withheld or delayed), to any other entity; provided, that notwithstanding
anything herein to the contrary, the Seller shall not be subject to any
increased costs or expenses as a result of such assignment made without Seller’s
consent; provided,  further that, if the Buyer assigns its rights and
obligations to a conduit or other entity supported by the Buyer or an Affiliate
of the Buyer, the Seller agrees to cooperate in good faith with the Buyer to
amend the Facility Documents to facilitate such assignment. Notwithstanding
anything to the contrary in this Article IX, the parties acknowledge and agree
that the Acknowledgment Agreement does not permit any assignments of, or any
parties rights, obligations, or interest in, the Acknowledgment Agreement,
except pursuant to the express provisions of the Acknowledgment Agreement.

(b)  The Administrative Agent, acting solely for this purpose as an agent of the
Seller, shall maintain at one of its offices at Eleven Madison Avenue, New York,
New York  10010 a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Assignees, and
the Maximum Purchase Price, the Repurchase Price and Price Differential of the
Transactions assigned to the Assignees pursuant to the terms hereof from time to
time (the “Register”).  The entries in the Register shall be conclusive absent
manifest error, and the Seller, the Administrative Agent, the Buyer and the
Assignees shall treat each Person whose name is recorded in the Register
pursuant

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to the terms hereof as a Buyer hereunder for all purposes of this
Agreement.  The Register shall be available for inspection by the Seller and any
Buyer (including Assignees), at any reasonable time and from time to time upon
reasonable prior notice.

Section 9.02    Rights of Assignee.  Upon the assignment by the Buyer of all of
its rights and obligations hereunder and under the other Facility Documents to
an assignee in accordance with Section 9.01, such assignee shall have all such
rights and obligations of the Buyer as set forth in such assignment or
delegation, as applicable, and all references to the Buyer in this Agreement or
any Facility Document shall be deemed to apply to such assignee to the extent of
such interest. If any interest in any Facility Document is transferred to any
assignee which is organized under the laws of any jurisdiction other than the
United States or any State thereof, the transferor the Buyer shall cause such
assignee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 3.02.

Section 9.03    Permitted Participants; Effect.

(a)        The Buyer may, in the ordinary course of its business and in
accordance with applicable law, at any time (and from time to time) assign,
pledge, hedge, hypothecate, or otherwise sell to one or more banks or other
entities (each a “Participant”) all or a portion of participation interests in
any Transaction or any Commitment of the Buyer, or any other interest of the
Buyer under this Agreement or the other Facility Documents.  In the event of any
such assignment, pledge, hedge, hypothecation or sale by the Buyer of a
participating interest to a Participant, (i) the Buyer’s obligations hereunder
and under the other Facility Documents shall remain unchanged; (ii) the Buyer
shall remain solely responsible to the Seller for the performance of such
obligations; and (iii) the Buyer shall remain the owner of its Transactions for
the purposes under the Facility Documents.  All amounts payable by the Seller
under this Agreement shall be determined as if the Buyer had not assigned,
pledged, hedged, hypothecated or otherwise sold such participating interests.
The Seller and the Buyer shall continue to deal solely and directly with each
other in connection with the Buyer’s rights and obligations under the Facility
Documents.

(b)        Any agreement or instrument pursuant to which the Buyer sells such a
participation shall provide that the Buyer shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that the Buyer will not, without the consent of the Participant, agree
to any amendment, modification or waiver described in Section 11.01 that affects
such Participant.  The Seller agrees that each Participant shall be entitled to
the benefits of Sections 2.05,  3.02 and 10.1 (subject to the requirements and
limitations therein, including the requirements under Section 3.02(d) (it being
understood that the documentation required under Section 3.02(d) shall be
delivered to the Buyer)) to the same extent as if it were the Buyer and had
acquired its interest by assignment pursuant to Section 9.01; provided that such
Participant shall not be entitled to receive any greater payment under Sections
2.05 or 3.02 with respect to any participation than the Buyer would have been
entitled to receive, except to the extent such entitlement to receive a greater
payment results from a Change in Law that occurs after the Participant acquired
the applicable participation. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 11.12 as though it were the
Buyer.  The Buyer shall, acting solely for this purpose as a non-fiduciary agent
of the Seller, maintain a register on which it enters the interest in the
Transactions or other obligations under the Facility Documents (the

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“Participant Register”); provided that the Buyer shall not have any obligation
to disclose all or any portion of the Participant Register (including the
identity of any Participant or any information relating to a Participant’s
interest in any commitments, loans, letters of credit or its other obligations
under any Facility Documents) to any Person except to the extent that such
disclosure is necessary to establish that such commitment, loan, letter of
credit or other obligation is in registered form under Section 5f.103-1(c) of
the United States Treasury Department regulations.  The entries in the
Participant Register shall be conclusive absent manifest error, and the Buyer
shall treat each Person whose name is recorded in the Participant Register as
the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary.

Section 9.04    Voting Rights of Participants.  The Buyer shall retain the sole
right to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Facility Documents other than any
amendment, modification, or waiver with respect to any Transaction or Maximum
Purchase Price in which such Participant has an interest which forgives
Repurchase Price, Price Differential, or fees or reduces the Pricing Rate or
fees payable with respect to any such Transaction or Maximum Purchase Price,
extends the Amortization Date, postpones any date fixed for any regularly
scheduled payment of the Repurchase Price or fees related to Transactions or
releases all or substantially all of the Repurchase Assets (other than as
expressly permitted pursuant to the Facility Documents).

ARTICLE X

INDEMNIFICATION

Section 10.01  Indemnities by the Seller.  Without limiting any other rights
which any such Person may have hereunder or under applicable law, the Seller
hereby agrees to indemnify, the Buyer, its Affiliates, successors, permitted
transferees and assigns and all officers, directors, shareholders, controlling
persons, employees and agents of any of the foregoing (each an “Indemnified
Party”), forthwith on demand, from and against any and all damages, losses,
claims, liabilities and related costs and expenses, including attorneys’ fees
and disbursements (all of the foregoing being collectively referred to as
“Indemnified Amounts”) awarded against or incurred by any of them arising out of
or as a result of this Agreement, the other Facility Documents, or any
transaction contemplated hereby or thereby excluding, however, (a) Indemnified
Amounts to the extent a court of competent jurisdiction determines that they
resulted from gross negligence, bad faith or willful misconduct on the part of
such Indemnified Party, (b) in the event that the Buyer has assigned its rights
or delegated its obligations in respect of this Agreement, and the Indemnified
Amounts with respect to such assignee exceed the Indemnified Amounts that would
otherwise have been payable by the Seller to the Buyer, the amount of such
excess, (c) taxes expressly excluded from Taxes in Section 3.02(a) above (other
than any such excluded taxes that are incremental and arise solely by reason of
a breach by the Seller of its obligations under this Agreement), and (d) any
lost profits or indirect, exemplary, punitive or consequential damages of any
Indemnified Party. In any suit, proceeding or action brought by the Buyer in
connection with any Repurchase Assets for any sum owing thereunder, or to
enforce any provisions of any Repurchase Assets, the Seller will save, indemnify
and hold the Buyer harmless from and against all expense, loss or damage
suffered by reason of any defense, set-off, counterclaim, recoupment or
reduction or liability whatsoever of the account debtor or obligor thereunder,
arising out of a

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breach by the Seller of any obligation thereunder or arising out of any other
agreement, indebtedness or liability at any time owing to or in favor of such
account debtor or obligor or its successors from the Seller. The Seller also
agrees to reimburse the Buyer as and when billed by the Buyer for all the
Buyer’s out-of-pocket costs and expenses incurred in connection with the
enforcement or the preservation of the Buyer’s rights under this Agreement, any
other Facility Document or any transaction contemplated hereby or thereby,
including without limitation the fees and disbursements of its counsel. The
Seller hereby acknowledges that the obligation of the Seller under each
Transaction is a recourse obligation of the Seller. Under no circumstances shall
any Indemnified Party be liable to the Seller for any lost profits or indirect,
exemplary, punitive or consequential damages.

Section 10.02  General Provisions.  If for any reason the indemnification
provided above in Section 10.01 (and subject to the limitations on
indemnification contained therein) is unavailable to an Indemnified Party or is
insufficient to hold an Indemnified Party harmless on the basis of public
policy, then the Seller shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, claim, damage or liability in such
proportion as is appropriate to reflect not only the relative benefits received
by such Indemnified Party on the one hand and the Seller on the other hand but
also the relative fault of such Indemnified Party as well as any other relevant
equitable considerations.

The provisions of this Article X shall survive the termination of this Agreement
and the payment of the Obligations.

ARTICLE XI

MISCELLANEOUS

Section 11.01  Amendments, Etc.  Neither this Agreement nor any provision hereof
may be amended, supplemented, or modified except pursuant to an agreement or
agreements in writing entered into by the Seller and the Buyer.

Section 11.02  Notices, Etc.  Except as provided herein, all notices required or
permitted by this Agreement shall be in writing (including without limitation by
Electronic Transmission, email or facsimile) and shall be effective and deemed
delivered only when received by the party to which it is sent; provided that
notices of Events of Default and exercise of remedies or under Section 8.02
shall be sent via overnight mail and by electronic transmission. Any such notice
shall be sent to a party at the address, electronic mail or facsimile
transmission number set forth on Schedule 11.02 or to such other address, e-mail
address or facsimile number as either party may notify to the others in writing
from time to time.

Section 11.03  No Waiver; Remedies.  No failure on the part of the Buyer to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

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Section 11.04  Binding Effect; Assignability.  This Agreement shall be binding
upon and inure to the benefit of the Seller and the Buyer, and their respective
successors and assigns, provided,  however, that nothing in the foregoing shall
be deemed to authorize any assignment not permitted in Section 9.01.

Section 11.05   GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES (OTHER THAN SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW, WHICH BY ITS TERMS APPLIES TO THIS
AGREEMENT). EACH PARTY HERETO HEREBY SUBMITS TO THE NON-EXCLUSIVE GENERAL
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK LOCATED 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 FOR PURPOSES OF ALL
LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT
IN THE BOROUGH OF MANHATTAN AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN
SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH PARTY HERETO HEREBY
CONSENTS TO PROCESS BEING SERVED IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT
TO THIS AGREEMENT, OR ANY DOCUMENT DELIVERED PURSUANT HERETO BY THE MAILING OF A
COPY THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, RETURN RECEIPT
REQUESTED, TO ITS RESPECTIVE ADDRESS SPECIFIED AT THE TIME FOR NOTICES UNDER
THIS AGREEMENT OR TO ANY OTHER ADDRESS OF WHICH IT SHALL HAVE GIVEN WRITTEN OR
ELECTRONIC NOTICE TO THE OTHER PARTIES. THE FOREGOING SHALL NOT LIMIT THE
ABILITY OF ANY PARTY HERETO TO BRING SUIT IN THE COURTS OF ANY OTHER
JURISDICTION.

EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO A TRIAL BY
JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.

Section 11.06  Entire Agreement and Single Agreement.

(a)        This Agreement and the other Facility Documents embodies the entire
agreement and understanding of the parties hereto and supersedes any and all
prior agreements, arrangements and understanding relating to the matters
provided for herein.

(b)        The Buyer and the Seller acknowledge that, and have entered into this
Agreement and will enter into each Transaction hereunder in consideration of and
in reliance upon the fact that, all Transactions hereunder, together with the
provisions of the Pricing Side Letter, constitute a single business and
contractual relationship and have been made in consideration of each
other.  Accordingly, each of the Buyer and the Seller agrees (i) to perform all
of its obligations in respect of each Transaction hereunder and its obligations
under the Pricing Side Letter, and that

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a default in the performance of any such obligations shall constitute a default
by it in respect of all Transactions hereunder, (ii) that the Buyer shall be
entitled to set off claims and apply property held by it in respect of any
Transaction against obligations owing to it in respect of any other Transactions
hereunder or any obligations under the Pricing Side Letter and (iii) that
payments, deliveries and other transfers made by either of them in respect of
any Transaction or any agreement under the Pricing Side Letter shall be deemed
to have been made in consideration of payments, deliveries and other transfers
in respect of any other Transactions hereunder or any agreement under the
Pricing Side Letter, and the obligations to make any such payments, deliveries
and other transfers may be applied against each other and netted.

Section 11.07  Acknowledgement.  The Seller hereby acknowledges that:

(a)        it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Facility Documents to which it is a
party;

(b)        the Buyer has no fiduciary relationship to the Seller, and the
relationship between the Seller and the Buyer is solely that of debtor and
creditor; and

(c)        no joint venture exists among or between the Buyer and the Seller.

Section 11.08  Captions and Cross References.  The various captions (including,
without limitation, the table of contents) in this Agreement are included for
convenience only and shall not affect the meaning or interpretation of any
provision of this Agreement. References in this Agreement to any underscored
Section or Exhibit are to such Section or Exhibit of this Agreement, as the case
may be.

Section 11.09  Execution in Counterparts.  This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which when taken together shall constitute one and the same agreement.

Section 11.10  Confidentiality.  Except as otherwise provided herein, each party
hereto agrees for the benefit of the other party that it will hold any
confidential information received from the other party pursuant to this
Agreement or any other Facility Document in strict confidence, as long as such
information remains confidential except for disclosure to (i) its Affiliates,
(ii) its legal counsel, accountants, and other professional advisors or to a
permitted assignee or participant, (iii) regulatory officials, (iv) any Person
as requested pursuant to or as required by law, regulation, legal process, or
the rules and regulations of any Governmental Authority or stock exchange,
(v) any Person in connection with any legal proceeding to which it is a party,
(vi) rating agencies if requested or required by such agencies in connection
with a rating, (vii) any Agency and (viii) any prospective or actual assignee or
participant hereunder (including any prospective or actual credit hedge
counterparty) (for so long as such party has executed a confidentiality or
non-disclosure agreement substantially similar to the terms and provisions of
this Section 11.10). The parties agree that this Agreement is confidential
information of the Buyer. The Buyer also agrees that it will comply with all
applicable securities laws with respect to any non-public information of the
type referenced in the preceding sentence in its possession. This Section 11.10
shall survive termination of this Agreement.

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Section 11.11  Survival.  This Agreement shall remain in effect until the
Termination Date; provided, however, that no such termination shall affect the
Seller’s Obligations to the Buyer at the time of such termination. The
obligations of the Seller under Sections 3.02,  10.01 and 11.10 hereof shall
survive the repayment of the Repurchase Price and the termination of this
Agreement. In addition, each representation and warranty made, or deemed to be
made by a request for a borrowing, herein or pursuant hereto shall survive the
making of such representation and warranty, and the Buyer shall not be deemed to
have waived, by reason of entering into any Transaction, any Default that may
arise by reason of such representation or warranty proving to have been false or
misleading, notwithstanding that the Buyer may have had notice or knowledge or
reason to believe that such representation or warranty was false or misleading
at the time such Transaction was entered into.

Section 11.12  Set-Off.  In addition to any rights and remedies of the Buyer
provided by this Agreement and by law, the Buyer shall have the right, without
prior notice to the Seller, any such notice being expressly waived by the Seller
to the extent permitted by applicable law, upon any amount becoming due and
payable by the Seller hereunder (whether at the stated maturity, by acceleration
or otherwise), to set-off and appropriate and apply against such amount any and
all Property and 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 the Buyer or any Affiliate
thereof to or for the credit or the account of the Seller.  The Buyer may
set-off cash, the proceeds of the liquidation of any Repurchase Assets and all
other sums or obligations owed by the Buyer or its Affiliates to the Seller
against all of the Seller’s obligations to the Buyer or its Affiliates under
this Agreement with respect to the Seller or under any other agreement between
the parties or between the Seller and any affiliate of the Buyer, or otherwise
whether or not such obligations are then due, without prejudice to the Buyer’s
or its Affiliate’s right to recover any deficiency.  The Buyer agrees promptly
to notify the Seller after any such set-off and application made by the Buyer;
provided that the failure to give such notice shall not affect the validity of
such set-off and application.

Section 11.13  Guaranty.

(a)        Subject to Section 11.13(h) below, the Guarantor hereby
unconditionally and irrevocably guarantees to the Buyer the prompt payment of
the Guaranteed Obligations in full when due (whether at the stated maturity, by
acceleration or otherwise). Any such payment shall be made at such place and in
the same currency as such relevant Guaranteed Obligation is payable. This
guaranty is a guaranty of payment and not solely of collection and is a
continuing guaranty and shall apply to all Guaranteed Obligations whenever
arising.

(b)        The obligations of the Guarantor hereunder are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of this Agreement, or any other agreement or instrument referred
to herein, to the fullest extent permitted by Applicable Law, irrespective of
any other circumstance whatsoever which might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor. The Guarantor agrees
that this guaranty may be enforced by the Buyer without the necessity at any
time of resorting to or exhausting any security or collateral and without the
necessity at any time of having recourse to this Agreement or any other Facility
Document or any collateral, if any, hereafter securing the Guaranteed

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Obligations or otherwise and the Guarantor hereby waives the right to require
the Buyer to proceed against any other Person or to require the Buyer to pursue
any other remedy or enforce any other right. The Guarantor further agrees that
nothing contained herein shall prevent the Buyer from suing in any jurisdiction
on this Agreement or any other Facility Document or foreclosing its security
interest in or Lien on any collateral, if any, securing the Guaranteed
Obligations or from exercising any other rights available to it under this
Agreement or any instrument of security, if any, and the exercise of any of the
aforesaid rights and the completion of any foreclosure proceedings shall not
constitute a discharge of the Guarantor’s obligations hereunder; it being the
purpose and intent of the Guarantor that its obligations hereunder shall be
absolute, independent and unconditional under any and all circumstances. Neither
the Guarantor’s obligations under this guaranty nor any remedy for the
enforcement thereof shall be impaired, modified, changed or released in any
manner whatsoever by reason of the application of the laws of any foreign
jurisdiction. The Guarantor waives any and all notice of the creation, renewal,
extension or accrual of any of the Guaranteed Obligations and notice of or proof
of reliance of by the Buyer upon this guaranty or acceptance of this guaranty.
The Guaranteed 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. All dealings between the Seller and the
Guarantor, on the one hand, and the Buyer, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon this
guaranty.

(c)        The Guarantor agrees that (i) all or any part of the security which
hereafter may be held for the Guaranteed Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (ii) the Buyer shall not have any
obligation to protect, perfect, secure or insure any such security interests or
Liens which hereafter may be held, if any, for the Guaranteed Obligations or the
properties subject thereto; (iii) the time or place of payment of the Guaranteed
Obligations may be changed or extended, in whole or in part, to a time certain
or otherwise, and may be renewed, increased or accelerated, in whole or in part;
(iv) the Seller and any other party liable for payment under this Agreement may
be granted indulgences generally; (v) any of the provisions of this Agreement or
any other Facility Document may be modified, amended or waived; and (vi) any
deposit balance for the credit of the Seller or any other party liable for the
payment of the Guaranteed Obligations or liable upon any security therefor may
be released, in whole or in part, at, before or after the stated, extended or
accelerated maturity of the Guaranteed Obligations, all without notice to or
further assent by the Guarantor, which shall remain bound thereon,
notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.

(d)        The Guarantor expressly waives to the fullest extent permitted by
Applicable Law: (i) notice of acceptance of this guaranty by the Buyer and of
all transfers of funds to the Seller by the Buyer; (ii) presentment and demand
for payment or performance of any of the Guaranteed Obligations; (iii) protest
and notice of dishonor or of default (except as specifically required in this
Agreement) with respect to the Guaranteed Obligations or with respect to any
security therefor; (iv) notice of the Buyer obtaining, amending, substituting
for, releasing, waiving or modifying any Lien, if any, hereafter securing the
Guaranteed Obligations, or the Buyer’s subordinating, compromising, discharging
or releasing such Liens, if any; (v) all other notices to which the Seller might
otherwise be entitled in connection with the guaranty evidenced by this Section
11.13; and (vi) demand for payment under this guaranty.

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(e)        The obligations of the Guarantor under this Section 11.13 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Guaranteed Obligations is rescinded
or must be otherwise restored by any holder of any of the Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and the Guarantor agrees that it will indemnify the
Buyer on demand for all reasonable and documented costs and out-of-pocket
expenses (including, without limitation, reasonable and documented fees and
expenses of counsel) incurred by the Buyer in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.

(f)        The Guarantor agrees that, as between the Guarantor, on the one hand,
and the Buyer, on the other hand, the Guaranteed Obligations may be declared to
be forthwith due and payable as provided in Section 8.02 (and shall be deemed to
have become automatically due and payable in the circumstances provided in
Section 8.02) notwithstanding any stay, injunction or other prohibition
preventing such declaration (or preventing such Guaranteed Obligations from
becoming automatically due and payable) as against any other Person and that, in
the event of such declaration (or such Guaranteed Obligations being deemed to
have become automatically due and payable), such Guaranteed Obligations (whether
or not due and payable by any other Person) shall forthwith become due and
payable by the Guarantor.

(g)        The Guarantor hereby agrees that until the payment and satisfaction
in full of all Guaranteed Obligations and the expiration and termination of this
Agreement, it shall not exercise any right or remedy arising by reason of any
performance by it of its guarantee in Section 11.13(a), whether by subrogation
or otherwise, against the Seller or any security for any of the Guaranteed
Obligations.

(h)        Notwithstanding any provision to the contrary contained herein, to
the extent the obligations of the Guarantor shall be adjudicated to be invalid
or unenforceable for any reason (including, without limitation, because of any
Applicable Law relating to fraudulent conveyances or transfers) then the
obligations of the Guarantor hereunder shall be limited to the maximum amount
that is permissible under Applicable Law (as now or hereinafter in effect).

(i)         This guaranty is 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(38)(A) and 741(7)(A)(xi) of
the Bankruptcy Code.

Section 11.14     Intent.

(a)        The parties agree and intend that this Agreement is a “master netting
agreement” as that term is defined in Section 101 of the Bankruptcy Code, that
this Agreement and each Transaction is a “securities contract” as that term is
defined in Section 741(7) of the Bankruptcy Code and that all payments hereunder
are deemed “margin payments” or “settlement payments” as defined in the
Bankruptcy Code.  The parties agree and acknowledge that the pledge of assets
under this Agreement constitutes “a security agreement or other arrangement or
other credit enhancement” that is “related to” the Agreement and the
Transactions hereunder within the meaning of Sections 101(38A)(A) and
741(7)(A)(xi) of the Bankruptcy Code. The Parties further

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intend and acknowledge that this Agreement is an agreement to provide financial
accommodations and is not subject to assumption pursuant to Bankruptcy Code
Section 365(a).

(b)        It is understood that, subject to the rights and interest of Fannie
Mae, either party’s right to accelerate or terminate this Agreement or to
liquidate Purchased Assets delivered to it in connection with Transactions
hereunder or to exercise any other remedies pursuant to Sections 4.04, 8.02 and
11.12 hereof is a contractual right to accelerate, terminate, or liquidate this
Agreement or such Transaction as described in Sections 555 and 561 of the
Bankruptcy Code.

(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).

[SIGNATURE PAGE FOLLOWS]

 

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their respective officers thereunto duly authorized, as of the date first above
written.

 

PENNYMAC LOAN SERVICES, LLC, as Seller and Servicer

 

 

 

 

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 CS-PLS – PC Master Repurchase Agreement

 

 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Buyer

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Authorized Signatory

 

 

 

 

By:

/s/ Margaret Dellafera

 

 

Name:

Margaret Dellafera

 

 

Title:

Authorized Signatory

 

 

 

 

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC, as Administrative Agent

 

 

 

 

By:

/s/ Dominic Obaditch

 

 

Name:

Dominic Obaditch

 

 

Title:

Vice President

 

 

 

Signature Page to CS-PLS – PC Master Repurchase Agreement

 

SCHEDULE I

DEFINITIONS

1.1       Definitions.  As used in this Agreement the following terms have the
meanings as indicated:

“Accepted Servicing Practices” means, with respect to any Mortgage Loan, those
mortgage servicing practices of prudent mortgage lending institutions which
service mortgage loans of the same type as such Mortgage Loan in the
jurisdiction where the related Mortgaged Property is located.

“Acknowledgment Agreement” means that certain Acknowledgment Agreement, by and
among Fannie Mae, the Seller and the Buyer as secured party, pursuant to which
Fannie Mae acknowledges the security interest granted pursuant to this Agreement
of the Buyer in the Servicing Rights related to pools of mortgage loans
securitized with Fannie Mae, together with any amendments and addenda thereto.

“Additional Repurchase Assets” has the meaning set forth in Section 4.01(c).

“Adjusted Tangible Net Worth” has the meaning set forth in the Pricing Side
Letter.

“Administrative Agent” has the meaning set forth in the Preamble.

“Advance” means any P&I Advance, T&I Advance or Corporate Advance.

“Affiliate” means, with respect to any Person, any other Person which, directly
or indirectly, controls, is controlled by, or is under common control with, such
Person.  For purposes of this definition, “control” (together with the
correlative meanings of “controlled by” and “under common control with”) means
possession, directly or indirectly, of the power (a) to vote 20% or more of the
securities (on a fully diluted basis) having ordinary voting power for the
directors or managing general partners (or their equivalent) of such Person, or
(b) to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by contract, or
otherwise; provided, however, that in respect of the Seller, the Servicer, or
the Guarantor the term “Affiliate” shall include only Private National Mortgage
Acceptance Company, LLC and its wholly owned subsidiaries.

“Agency” means Fannie Mae, Freddie Mac or Ginnie Mae, as applicable.

“Agency Approvals” has the meaning set forth in Section 7.01(u).

“Agency Guide” with respect to (1) Fannie Mae, the Fannie Mae Guide (as defined
herein), (2) Freddie Mac, the Freddie Mac Single-Family Seller/Servicer Guide,
as may be amended or modified from time to time and (3) with respect to Ginnie
Mae, the Ginnie Mae MBS Guide, as may be amended from time to time, and in all
cases, any other applicable guides published by such Agency and any related
announcements, directives and correspondence issued by such Agency.

 

“Agency Servicing Rights” means all Servicing Rights with respect to the
Agencies.

“Agreement” has the meaning set forth in the preamble.

“Amortization Date” means the earliest to occur of (i) the Maturity Date, or
(ii) the Business Day specified by the Buyer upon ten (10) Business Days’ prior
written notice to the Seller.

“Ancillary Income” means all money which is due and payable in connection with
each Mortgage Loan other than the Servicing Fee and specifically including,
without limitation, late charge fees, assignment transfer fees, insufficient
funds check charges, amortization schedule fees, interest from escrow accounts
and all other incidental fees and charges and any Float Benefit, in each case,
to the extent such amounts are allocable to a Mortgage Loan, specifically
excluding Excluded Collateral.

“Applicable Law” means as to any Person, any law, treaty, rule or regulation
(including the Investment Company Act of 1940, as amended) or determination of
an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.

“Applicable Margin”  has the meaning assigned to it in the Pricing Side Letter.

“Asset” means any (a) any Servicing Rights and (b) without duplication, the
related Participation Certificate (including, for the avoidance of doubt, all
Excess Spread), in each case, sold to the Buyer and pledged to secure the
Obligations hereunder.

“Asset Base” means, as of any date of determination, an amount equal to the
aggregate Asset Value of all of the Repurchase Assets that have been and remain
pledged to the Buyer hereunder.

“Asset Base Report” means the asset base report, substantially in a format
agreed upon between the Seller and the Buyer, delivered by the Buyer in
accordance with Section 2.03.

“Asset Reporting Date” has the meaning set forth in Section 2.02(c).

“Asset Schedule” means a list of all Assets pledged or delivered from time to
time by the Seller to the Buyer, listing as of the date of such schedule the
Participation Certificate and the Eligible Servicing Rights evidenced thereby,
as such schedule shall be updated from time to time in accordance with
Section 2.02 hereof.

“Asset Value” means, for purposes of determining the value of the Asset Base
from time to time, with respect to the Participation Certificate and the related
Eligible Servicing Rights, (a) (i) the Purchase Price Percentage for Eligible
Servicing Rights, multiplied by (ii) the MSR Value of the Eligible Servicing
Rights, minus (b) any outstanding repurchase and indemnity obligations under the
related Servicing Contract that are due and payable by the Seller following the
end of any rebuttal period provided under the Fannie Mae Guide, but have not yet
been paid by the Seller.

2

 

“Assignee” means any Person to whom the Buyer may assign its interest pursuant
to Section 9.01(a).

“Assignment and Assumption” means an assignment and assumption entered into by
the Buyer and an Assignee.

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

“Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

“Business Day” means any day other than (i) a Saturday or Sunday or (ii) a day
upon which the New York Stock Exchange or the Federal Reserve Bank of New York
is closed.

“Buyer”  means as defined in the Preamble.

“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.

“Cash Equivalents” means (a) securities with maturities of 90 days or less from
the date of acquisition issued or fully guaranteed or insured by the United
States Government or any agency thereof, (b) certificates of deposit and
eurodollar time deposits with maturities of 90 days or less from the date of
acquisition and overnight bank deposits of the Buyer or of any commercial bank
having capital and surplus in excess of $500,000,000, (c) repurchase obligations
of the Buyer or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than seven days with respect to
securities issued or fully guaranteed or insured by the United States
Government, (d) commercial paper of a domestic issuer rated at least “A-1” or
the equivalent thereof by S&P or “P-1” or the equivalent thereof by Moody’s and
in either case maturing within 90 days after the day of acquisition, (e)
securities with maturities of 90 days or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the United
States, by any political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government, the securities of which
state, commonwealth, territory, political subdivision, taxing authority or
foreign government (as the case may be) are rated at least “A” by S&P or “A” by
Moody’s, (f) securities with maturities of 90 days or less from the date of
acquisition backed by standby letters of credit issued by the Buyer or any
commercial bank satisfying the requirements of clause (b) of this definition or
(g) shares of money market mutual or similar funds which invest exclusively in
assets satisfying the requirements of clauses (a) through (f) of this
definition.

“Change in Law” means a change in any Applicable Law applicable to the Facility
Documents that would have an adverse effect, as determined by the Buyer in its
sole discretion, on the Buyer’s exercise of remedies following an Event of
Default.

3

 

“Change of Control”  (i) for the Seller (a) any transaction or event as a result
of which the Guarantor ceases to own, beneficially or of record, more than 50%
of the stock of the Seller, (b) the Disposition of all or substantially all of
the Seller’s assets (excluding any such action taken in connection with any
securitization transaction or routine sales of Mortgage Loans), or (c) the
consummation of a merger or consolidation of the Seller 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 equity outstanding
immediately after such merger, consolidation or such other reorganization is
owned by persons who were not equityholders of the Seller immediately prior to
such merger, consolidation or other reorganization and (ii) for the Guarantor
(a) the Disposition of all or substantially all of the Guarantor’s assets
(excluding any such action taken in connection with any securitization
transaction or routine sales of Mortgage Loans) or (b) the consummation of a
merger or consolidation of the Guarantor 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 equity outstanding immediately after such
merger, consolidation or such other reorganization is owned by persons who were
not equityholders of the Guarantor immediately prior to such merger,
consolidation or other reorganization.

“Closing Date” means the date on which all of the conditions set out in
Section 5.01 are satisfied.

“Code” means the Internal Revenue Code of 1986, as amended.

“Collections” means any Servicing Fees, any excess servicing or subservicing
rights or retained yield, and any Ancillary Income that the Seller as servicer
is entitled to receive pursuant to the Servicing Contracts.

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

“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.

“Compliance Certificate” means a certificate substantially in the form of
Exhibit A to the Pricing Side Letter hereto or other form reasonably acceptable
to the Buyer.

“Conventional MSR Loan Agreement” has the meaning set forth in the Recitals.

“Corporate Advance” means, collectively, (a) any advance (other than those
described in clause (b) below) made by the Seller as servicer pursuant to the
Servicing Contracts to inspect, protect, preserve or repair properties that
secure defaulted Mortgage Loans or that have been acquired through foreclosure
or deed in lieu of foreclosure or other similar action pending disposition
thereof, or for similar or related purposes, including, but not limited to,
necessary legal fees and costs expended or incurred by the Seller as servicer in
connection with foreclosure, bankruptcy, eviction or litigation actions with or
involving Mortgagors on defaulted Mortgage

4

 

Loans, as well as costs to obtain clear title to such a property, to protect the
priority of the lien created by a Mortgage Loan on such a property, and to
dispose of properties taken through foreclosure or by deed in lieu thereof or
other similar action, (b) any advance made by the Seller as servicer pursuant to
the Servicing Contracts to foreclose or undertake similar action with respect to
a Mortgage Loan, and (c) any other out of pocket expenses incurred by the Seller
as servicer pursuant to the Servicing Contracts (including, for example, costs
and expenses incurred in loss mitigation efforts and in processing assumptions
of Mortgage Loans), to the extent such advances are reimbursable pursuant to the
Servicing Contracts.

“CSCIB” means Credit Suisse AG, Cayman Islands Branch.

“CSFB” means Credit Suisse First Boston Mortgage Capital LLC.

“Custodial File” means with respect to any Mortgage Loan, a file pertaining to
such Mortgage Loan being held by the Custodian that contains the mortgage
documents pertaining to such Mortgage Loan.

“Custodian” means any financial institution that holds documents for any of the
Mortgage Loans on behalf of an Agency.

“Dedicated Account”  means the demand deposit account that has been established
by the Seller for the purpose of holding cash proceeds of the Eligible Servicing
Rights and the related Participation Certificate at City National Bank, which
such deposit account shall be subject to a control agreement among the Seller,
City National Bank and the Buyer.  The Seller shall have an obligation to
deposit such cash proceeds into the Dedicated Account.  The Buyer shall have the
option to change the account to be designated as the “Deposit Account” following
the occurrence of a Default or if the Buyer ceases to have a perfected security
interest in the Dedicated Account.

“Dedicated Account Control Agreement” means that certain control agreement among
the Seller, City National Bank and the Buyer, dated as of September 11, 2019,
pursuant to which the Dedicated Account is governed, and any other control
agreement governing the Dedicated Account.

“Default” means an Event of Default or an Unmatured Event of Default.

“Default Rate” means, with respect to any Price Differential for any Price
Differential Period, and any late payment of fees or other amounts due
hereunder, the LIBOR Rate for the related Price Differential Period (or for all
successive Price Differential Periods during which such fees or other amounts
were delinquent), plus 5.0% per annum.

“Disposition” means, with respect to any Person, any sale or other whole or
partial conveyance of all or any portion of such Person’s Property, or any
direct or indirect interest therein to a third party, including the granting of
any purchase options, rights of first refusal, rights of first offer or similar
rights in respect of any portion of such assets or the subjecting of any portion
of such assets to restrictions on transfer.

5

 

“Divisive Merger” has the meaning set forth in Section 7.01(b).

“Dollars”  or “$”  means dollars in lawful money of the United States of
America.

“Electronic File” means any electronic file, in form and substance reasonably
acceptable to the Buyer and containing the information agreed to between the
Seller and the Buyer; delivered by the Seller to the Buyer on a  Purchase Date
or Asset Reporting Date pursuant to Section 2.03(a) or 2.03(b) and reflecting
those Mortgage Loans related to Pledged Servicing Rights as of the close of
business on such Purchase Date; provided,  however, that with regard to the
Electronic File delivered in connection with an Asset Reporting Date,  such
Electronic File shall reflect information as of the close of business on the
last Business Day of the preceding calendar month.

“Electronic Transmission” means the delivery of information in an electronic
format acceptable to the applicable recipient thereof. An Electronic
Transmission shall be considered written notice for all purposes hereof (except
when a request or notice by its terms requires delivery of an original executed
document).

“Eligible Servicing Rights” means, Servicing Rights owned by the Seller that are
either (i) appurtenant to mortgage loans that have been sold to Fannie Mae or
otherwise delivered to Fannie Mae for inclusion in a securitization by Fannie
Mae, and are serviced by the Seller and (ii) appurtenant to mortgage loans
(1) which were, but are no longer, pooled in securitizations by Fannie Mae,
(2) which are currently owned by Fannie Mae in portfolio and (3) for which the
Seller is acting as the servicer; provided that all such mortgage loans shall be
“qualified mortgages” or otherwise approved by the Buyer for inclusion. In
addition, all Eligible Servicing Rights must comply with the eligibility
criteria set out in Schedule II.

“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
the Seller or the Guarantor 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 a single employer described in Section 414 of the
Code.

“Event of Default” has the meaning set forth in Section 8.01.

“Excess Spread” means “Portfolio Excess Spread” as defined in the Excess Spread
Participation Agreement.

“Excess Spread Participation Agreement” means that certain MSR Excess Spread
Participation Agreement, dated as of September 11, 2019, between the Seller, as
company, and the Seller, as initial participant, as amended, supplemented or
replaced from time to time.

“Excluded Collateral” means all right, title and interest of the Seller, whether
now owned or hereafter acquired, in, to and under its rights to reimbursement
for all Advances made under the Servicing Contracts.

6

 

“Facility Documents” means this Agreement, any Transaction Notice, the Pricing
Side Letter, the Servicing Contracts, the Acknowledgment Agreement, any
Subservicer Acknowledgment Letter, if applicable, any Subservicing Agreement, if
applicable, the Dedicated Account Control Agreement, and all notices,
certificates, financing statements and other documents to be executed and
delivered by the Seller in connection with the transactions contemplated by this
Agreement.  For the avoidance of doubt, the Program Agreements (as defined in
the Repo Agreement) shall not be deemed Facility Documents.

“Fannie Mae” means The Federal National Mortgage Association, also known as
Fannie Mae, or any successor thereto.

“Fannie Mae Guide” means the Fannie Mae Selling Guide and the Fannie Mae
Servicing Guide, as may be amended from time to time.

“Fannie Mae MBS”  means an MBS issued by Fannie Mae.

“Fannie Mae Servicing Contract” means the Fannie Mae Mortgage Selling and
Servicing Contract, the Fannie Mae Servicing Guide, the Fannie Mae Selling Guide
and all related supplemental servicing instructions or directives provided by
Fannie Mae and all applicable master agreements, recourse agreements, repurchase
agreements, loss sharing agreements and any indemnification agreements and any
other agreements between Fannie Mae and the Seller, all as amended, restated or
supplemented from time to time.

“Fannie Mae Servicing Rights” means all Servicing Rights with respect to
mortgage loans serviced by the Seller for Fannie Mae.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof, any agreements entered into
pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory
legislation, rules or practices adopted pursuant to any intergovernmental
agreement, treaty or convention among Governmental Authorities and implementing
such Sections of the Code.

“FDIA” has the meaning set forth in Section 11.14(c).

“FDICIA” has the meaning set forth in Section 11.14(d).

“FHA” means the Federal Housing Administration, an agency within the United
States Department of Housing and Urban Development, or any successor thereto,
and including the Federal Housing Commissioner and the Secretary of Housing and
Urban Development where appropriate under the FHA Regulations.

“FHA Approved Mortgagee” means a corporation or institution approved as a
mortgagee by the FHA under the National Housing Act, as amended from time to
time, and applicable FHA Regulations, and eligible to own and service mortgage
loans such as the FHA Loans.

7

 

“FHA Loan” means a Mortgage Loan which is the subject of an FHA Mortgage
Insurance Contract.

“FHA Mortgage Insurance Contract” means the contractual obligation of the FHA
respecting the insurance of a Mortgage Loan.

“Float Benefit” means the net economic benefit resulting from investments of
funds representing escrow and custodial deposits held for the account of the
servicer or subservicer, or Fannie Mae relating to the Mortgage Loans.

“Foreign Lender” means any successor or assignee of the Buyer that is organized
under the laws of a jurisdiction other than that in which the Seller is resident
for tax purposes. For purposes of this definition, the United States of America,
each State and Commonwealth thereof and the District of Columbia shall be deemed
to constitute a single jurisdiction.

“Foreign Purchaser” has the meaning set forth in Section 3.02(d).

“Freddie Mac” means The Federal Home Loan Mortgage Corporation, also known as
Freddie Mac, or any successor thereto.

“GAAP” means United States Generally Accepted Accounting Principles inclusive
of, but not limited to, applicable statements of Financial Accounting Standards
issued by the Financial Accounting Standards Board, its predecessors and
successors and SEC Staff Accounting Guidance as in effect from time to time
applied on a consistent basis.

“Ginnie Mae” means The Government National Mortgage Association, also known as
Ginnie Mae, or any successor thereto.

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof, any municipality and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.

“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 (a) endorsements for collection or deposit in the
ordinary course of business, or (b) 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.

8

 

“Guaranteed Obligations” means, without duplication, all of the Obligations of
the Seller to the Buyer, whenever arising, under this Agreement or any other
Facility Document (including, but not limited to, obligations with respect to
principal, interest and fees).

“Guarantor” has the meaning set forth in the Preamble.

“HUD” means the United States Department of Housing and Urban Development, or
any successor thereto.

“Indebtedness” means, for any Person: at any time, and only to the extent
outstanding at such time: (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 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
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.

“Indemnified Amounts” has the meaning set forth in Section 10.01.

“Indemnified Party” has the meaning set forth in Section 10.01.

“Initial Transaction” has the meaning set forth in Section 2.02(b).

“Insolvency Law” means any bankruptcy, reorganization, moratorium, delinquency,
arrangement, insolvency, readjustment of debt, dissolution or liquidation law of
any jurisdiction in effect at any time during the term of this Agreement.

“Investment Company Act” means the Investment Company Act of 1940, as amended,
together with the rules and regulations promulgated thereunder.

“IRS” has the meaning set forth in Section 3.02(d).

“LIBOR Index Rate” means the rate (adjusted for statutory reserve requirements
for eurocurrency liabilities) for Eurodollar deposits for a period equal to one
month appearing on Bloomberg Screen US 0001M Page or if such rate ceases to
appear on Bloomberg Screen

9

 

US 0001M Page, on any other service providing comparable rate quotations at
approximately 11:00 a.m. (London, England time) on the applicable date of
determination.

“LIBOR Rate” means for each day, (a) the LIBOR Index Rate, if such rate is
available, (b) in the event that LIBOR Index Rate is phased out, and a new
benchmark intended as a replacement for LIBOR Index Rate is established or
administered by the Financial Conduct Authority or ICE Benchmark Administration
or other comparable authority, and such new benchmark with a one-month maturity
is readily available through Bloomberg or a comparable medium, then the Buyer
will utilize such new benchmark with a one-month maturity for all purposes
hereof in place of the LIBOR Index Rate, and (c) if the LIBOR Index Rate cannot
be determined or has been phased out and no new benchmark under clause (b) has
been established, the arithmetic average of the rates of interest per annum
(rounded upward, if necessary, to the nearest 1/100 of 1%) at which deposits in
U.S. Dollars in immediately available funds are offered to the Buyer at 11:00
a.m. (London, England time) two (2) London Banking Days before the beginning of
such one-month period by three (3) or more major banks in the interbank
Eurodollar market selected by the Buyer for delivery on the first day of and for
a period equal to such one-month period and in an amount equal or comparable to
the principal amount of the Purchase Price on which the “LIBOR Rate” is being
calculated.

“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, and in each case, other than an Agency’s rights and
interests in the related Agency Servicing Rights.

“London Banking Day” means any day on which commercial banks and foreign
exchange markets settle payment in both London and New York City.

“Margin Call” has the meaning set forth in Section 2.07.

“Margin Call Payment Date” has the meaning set forth in Section 2.08.

“Margin Deficit” has the meaning set forth in Section 2.07.

“Margin Shortfall Day” has the meaning set forth in Section 2.07.

“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 a Seller Party, any Subservicer, the Guarantor or
any Affiliate thereof that is a party to any Facility Documents taken as a
whole, (b) a material impairment of the ability of a Seller Party, any
Subservicer, the Guarantor or any Affiliate thereof that is a party to any
Facility Document to perform its obligations under any of the Facility Documents
to which it is a party and to avoid any Event of Default, or (c) a material
adverse effect upon the legality, validity, binding effect or enforceability of
any of the Facility Documents against any Seller Party or any Affiliate thereof
that is a party to any Facility Document, as determined by the Buyer in its sole
discretion.

10

 

“Maturity Date”  has the meaning set forth in the Pricing Side Letter.

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

“MBS” means mortgage backed securities.

“MBS Trust” means any of the trusts or trust estates in which the Mortgage Loans
being serviced by the Seller pursuant to the Servicing Contracts are held by the
related MBS Trustee.

“MBS Trustee” means a trustee or indenture trustee for an MBS Trust.

“Moody’s” means Moody’s Investors Service, Inc. or its successor in interest.

“Mortgage” means a mortgage, mortgage deed, deed of trust, or other instrument
creating a first lien on or first priority security interest in an estate in fee
simple in real property.

“Mortgage File” means, with respect to any Mortgage Loan, a file or files
pertaining to such Mortgage Loan that contains the mortgage documents pertaining
to such Mortgage Loan including any mortgage documents pertaining to such
Mortgage Loan required by the Fannie Mae Guide.

“Mortgage Loan” means the mortgage loans listed on the Relevant Electronic File
(as provided to the Buyer pursuant to Section 2.02(b) or 2.02(c)).

“Mortgage Note” means the note or other evidence of indebtedness of a Mortgagor
secured by a Mortgage pertaining to a Mortgage Loan, including any riders,
assumption agreements or modifications relating thereto.

“Mortgaged Property” means the real property or leasehold estate, if applicable
securing repayment of the debt evidenced by a Mortgage Note.

“Mortgagor” means any Person who owes or may be liable for payments under a
Mortgage Loan.

“MSR PC Repo Facility” has the meaning set forth in the Recitals.

“MSR Value” means, with respect to (i) any Eligible Servicing Right included in
the Asset Base the fair value ascribed to such asset by the Buyer in its sole
discretion, taking into account any outstanding obligations owed by the Seller
to an Agency, as applicable, as marked to market as often as daily, (ii) a
Servicing Right which is not an Eligible Servicing Right included in the Asset
Base, zero. The Buyer’s good faith determination of MSR Value shall be
conclusive upon the parties, absent manifest error on the part of the Buyer. The
Seller acknowledges that the Buyer’s determination of MSR Value is for the
limited purpose of determining Asset Value for lending purposes hereunder
without the ability to perform customary purchaser’s due diligence and is not
necessarily equivalent to a determination of the fair market value of the
Eligible Servicing Rights achieved by obtaining competing bids.  For the purpose
of determining the related MSR Value, the Buyer shall have the right to use
either the Seller’s valuation of the Eligible

11

 

Servicing Rights delivered pursuant to Section 2.03 herein or the Buyer’s
valuation, or both. Subsequently, the Buyer shall have the right to reasonably
request at any time from the Seller, an updated valuation for each Eligible
Servicing Right, in a form acceptable to the Buyer in its sole discretion;
provided that the Buyer shall not be obligated to rely on either valuation and
shall have the right to determine the MSR Value of the Eligible Servicing Rights
at any time in its sole discretion. The MSR Value shall be deemed to be zero
with respect to each Transaction for which such valuation is not provided within
a reasonable time.

“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 any
Seller Party or any ERISA Affiliate and that is covered by Title IV of ERISA.

“Net Income” means, for any period and any Person, the net income of such Person
for such period as determined in accordance with GAAP.

“Non-Recourse Debt” shall mean Indebtedness payable solely from the assets sold
or pledged to secure such Indebtedness and under which Indebtedness no party has
recourse to any Seller Party or any of their Affiliates if such assets are
inadequate or unavailable to pay off such Indebtedness, and neither Seller
Parties nor any of their Affiliates effectively has any obligation to directly
or indirectly pay any such deficiency.

“Obligations” means all of the Seller’s obligations to pay the Repurchase Price
in full and all other amounts payable by the Seller to the Buyer pursuant to
this Agreement or any other Facility Document.

“Opinion of Counsel” means a written opinion of counsel, reasonably acceptable
to each Person to whom such opinion is addressed.

“Optional Prepayment Date” has the meaning set forth in Section 2.08.

“Other Taxes” has the meaning set forth in Section 3.02(b).

“P&I Advance” means any advance disbursed by the Seller as servicer pursuant to
any Servicing Contract of delinquent interest and/or principal on the related
Mortgage Loans.

“Participant” has the meaning set forth in Section 9.03.

“Participant Register” has the meaning set forth in Section 9.03.

“Participation Agreement” means the Excess Spread Participation Agreement.

“Participation Certificate” means the original participation certificate issued
and delivered in connection with the Participation Agreement.

“Participation Interest” has the meaning given such term in the Participation
Agreement.

 “Person” means any individual, corporation, estate, partnership, limited
liability company, limited liability partnership, joint venture, association,
joint-stock company, business trust, trust,

12

 

unincorporated organization, government or any agency or political subdivision
thereof, or other entity of a similar nature.

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

“Pledged Servicing Rights” means any Eligible Servicing Rights a security
interest in which has been granted to the Buyer pursuant to this Agreement (it
being understood that the Servicing Rights pledged will be identified by pool
number in the Electronic Files).

“Pool” means a group of Mortgage Loans, which are the security for a
mortgage-backed security issued or guaranteed by an Agency.

“Prepayment Date” has the meaning set forth in Section 2.08.

“Price Differential” has the meaning set forth in the first sentence of Section
2.04.

“Price Differential Payment Date” means, (i) initially, the earliest to occur of
(a) the twenty-fifth (25th)  day of each calendar month, commencing September
2019, and (b) the Amortization Date, and (ii) following the occurrence of the
Amortization Date, each Repurchase Date (or, if such day is not a Business Day,
the following Business Day).

“Price Differential Period” means, for any Transaction, (i) an initial period
beginning on the Purchase Date for such Transaction and ending on the last day
of the calendar month in which such Purchase Date occurs; and (ii) subsequent
consecutive periods thereafter, beginning on the first day of each subsequent
calendar month and ending on the earlier of (x) the last day of the same
calendar month in which such Price Differential Period began and (y) the
Amortization Date; and (iii) subsequent consecutive periods after the
Amortization Date, beginning on the first day following, initially, the
Amortization Date, and thereafter, each Repurchase Date, and ending on the
earlier of (x) the day prior to the next following Repurchase Date and (y) the
date on which the amount of all Obligations have been reduced to zero.

“Pricing Rate” has the meaning set forth in Section 2.04.

“Pricing Side Letter” means that certain Pricing Side Letter, dated as of the
date hereof, among the Seller, the Guarantor and the Buyer, entered into in
connection with this Agreement, as the same may be amended, modified or
supplemented from time to time.

“Primary Repurchase Assets” has the meaning set forth in Section 4.01.

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

“Prohibited Person” has the meaning set forth in Section 6.01(w).

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

13

 

“PSA” means a pooling and servicing agreement or similar agreement related to a
non-agency securitization.

“Purchase Date” means the date any Transaction is entered into hereunder as
provided in Section 2.02 hereof.

“Purchase Price” means the price at which each Purchased Asset is transferred by
the Seller to the Buyer, which shall equal:

(i)         on the Purchase Date, the applicable Asset Value;

(ii)       on any day after the Purchase Date, except where the Buyer and the
Seller agree otherwise, the amount determined under the immediately preceding
clause (i) decreased by the amount of any cash transferred by the Seller to the
Buyer pursuant to Section 2.08 hereof.

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

“Purchased Assets” means the collective reference to the Participation
Certificate together with the Repurchase Assets related to the Participation
Certificate transferred by the Seller to the Buyer in a Transaction hereunder,
listed on the related Asset Schedule attached to the related Transaction
Notice.  For the sake of clarity, notwithstanding that related Servicing Rights
are pledged, and not sold, to the Buyer hereunder, such Servicing Rights will
nevertheless be included herein as Purchased Assets.

“Recourse Servicing Obligations” means with respect to any mortgage loan,
(a) any obligation or liability (actual or contingent) of the servicer or
subservicer in respect of such Mortgage Loan to indemnify Fannie Mae for any
losses incurred in respect of any Mortgage Loan that was determined at the time
of sale to have been ineligible for sale to Fannie Mae due to a breach of one or
more representations and warranties but accepted for purchase subject to any
waiver and indemnity obligations, or (b) any other obligations described from
time to time as being sold “with recourse” as such term (or terms of similar
meaning) are defined in the Fannie Mae Guide, as amended or supplemented from
time to time, and any successor publications thereto having the same general
contents and purpose.

“Register” has the meaning set forth in Section 9.01(b).

“Related Escrow Account Balances” means the balance, on the related Purchase
Date, of any escrow or impound accounts maintained by the Seller which relate to
any Mortgage Loan, including, without limitation, items escrowed for mortgage
insurance, property taxes (either real or personal), hazard insurance, flood
insurance, ground rents, or any other escrow or impound items required by any
Mortgage Note or Mortgage, reduced by any unpaid real estate taxes or insurance
premiums required to be paid by the Seller, with respect to which amounts have
been escrowed by the related Mortgagor.

“Related Principal and Interest Custodial Accounts” means all principal and
interest custodial accounts maintained by the Seller that relate to any Mortgage
Loan or Pool.

14

 

“Relevant Electronic File” means, on any Business Day, the most recently
delivered Electronic File that was delivered in accordance with Section 2.02(b)
or 2.02(c) and relates to Eligible Servicing Rights that constitute Repurchase
Assets hereunder.

“Repo Agreement” means the Third Amended and Restated Master Repurchase
Agreement, dated as of April 28,  2017, by and among CSFB, CSCIB and Alpine
Securitization LTD, the Seller, and the Guarantor, as amended, restated,
supplemented or otherwise modified from time to time.

“Repurchase Assets” has the meaning set forth in Section 4.01.

“Repurchase Date” means, (i) initially, the Amortization Date, and
(ii) thereafter, the day of each subsequent calendar month that is the same day
in a calendar month on which the Amortization Date occurred, provided that if
such day is not a Business Day, then the next Business Day.

“Repurchase Notice” means a notice substantially in the form of Exhibit 2.08(b).

“Repurchase Price” means the price at which Purchased Assets are to be
transferred from the Buyer to the Seller (other than the Eligible Servicing
Rights, which are pledged, and not sold, to the Buyer) upon termination of a
Transaction, which will be determined in each case (including Transactions
terminable upon demand) as the sum of the Purchase Price for such Purchased
Assets and the accrued but unpaid Price Differential as of the date of such
determination.

“Repurchase Rights” has the meaning set forth in Section 4.01(c).

“Requirements of Law” means, with respect to any Person or any of its property,
the certificate of incorporation or articles of association and by-laws,
certificate of limited partnership, limited partnership agreement or other
organizational or governing documents of such Person, and any law, treaty, rule
or regulation, or determination of any arbitrator or Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject, whether Federal, state or
local (including, without limitation, usury laws, the Federal Truth in Lending
Act and retail installment sales acts).

“Responsible Officer” means (a) with respect to the Seller, the chief executive
officer, president, chief financial officer, treasurer, assistant vice
president, assistant treasurer, secretary or assistant secretary of the Seller,
or any other officer having substantially the same authority and responsibility;
provided, that with respect specifically to the obligations of the Seller set
forth in Section 7.01(h) hereof, only the chief financial officer, treasurer,
assistant treasurer, or comptroller of the Seller shall be deemed to be a
Responsible Officer; and (b) with respect to the Buyer, a lending officer
charged with responsibility for the day to day management of the relationship of
such institution with the Seller.

“Restricted Cash” means for any Person, any amount of cash of such Person that
is contractually required to be set aside, segregated or otherwise reserved.

“Restricted Payment” means with respect to any Person, collectively, all
dividends or other distributions of any nature (cash, securities, assets or
otherwise), and all payments, by virtue of

15

 

redemption or otherwise, on any class of equity securities (including, warrants,
options or rights therefor) issued by such Person, which may hereafter be
authorized or outstanding and any distribution in respect of any of the
foregoing, whether directly or indirectly other than payments made in the
ordinary course solely for the purpose of originating, servicing, subservicing
and/or administrating Mortgage Loans.

“S&P” means Standard & Poor’s, a division of The McGraw Hill Companies, Inc.

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

“Securitization Transaction” means a transaction whereby a Mortgage Loan is
transferred to a trust as part of a publicly-issued and/or privately placed,
rated or unrated, mortgage pass-through transaction including, without
limitation, Fannie Mae MBS.

“Seller” has the meaning set forth in the preamble.

“Seller Party” means each of the Seller and the Guarantor.

“Servicer”  has the meaning set forth in the preamble.

“Servicing Contracts” means the Fannie Mae Servicing Contract, as such agreement
may be amended, amended and restated, supplemented or otherwise modified from
time to time.

“Servicing Fee” means the total amount of the fee payable to the Servicer as
compensation for servicing and administering the Mortgage Loans.

“Servicing Rights” means with respect to each Mortgage Loan, all the Seller’s
right, title and interest in, to and under the related Servicing Contracts,
whether now or hereafter existing, acquired or created, whether or not yet
accrued, earned, due or payable, as well as all other present and future right
and interest under such Servicing Contracts, including, without limitation, the
right (i) to receive the Servicing Fee income payable after the related Purchase
Date (including without limitation, any Uncollected Fees), (ii) any and all
Ancillary Income received after the related Purchase Date, (iii) to hold and
administer the Related Escrow Account Balances, (iv) to hold and administer, in
accordance with the applicable Agency Guides, the Related Principal and Interest
Custodial Account, the Custodial File, and the Mortgage File arising from or
connected to the servicing or subservicing of such Mortgage Loan under this
Agreement and (v) all proceeds, income, profits, rents and products of any of
the foregoing including, without limitation, all of the Seller’s rights to
proceeds of any sale or other disposition of the Servicing Rights, but with
respect to clauses (i) – (iv) above, specifically excluding any Excluded
Collateral.

“Servicing Rights Asset” means (i) all Servicing Rights arising under or related
to any Servicing Contract; (ii) all records, instruments or other documentation
evidencing any of the foregoing; (iii) 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
the Seller’s rights, title and interest in and under the Servicing Contracts);
and (iv) any and all replacements, substitutions, distributions on or proceeds
of any and all of the foregoing.

“Subservicer” means the subservicer party to any Subservicing Agreement.

16

 

“Subservicer Acknowledgment Letter” has the meaning set forth in Section
7.01(dd).

“Subservicer Termination Event” means an event that entitles the Seller to
terminate a subservicer for cause under a Subservicing Agreement.

“Subservicing Agreement” means any subservicing agreement entered into between
the Seller and a subservicer, subject to the consent of the Buyer.

“Subsidiary” means a corporation of which a Person and/or its other Subsidiaries
own, directly or indirectly, such number of outstanding shares as have more than
50% of the ordinary voting power for the election of directors.

“T&I Advance” means an advance made by the Seller as servicer with respect to a
Mortgage Loan pursuant to the servicer’s obligation to do so under any Servicing
Contract of real estate taxes and assessments, or of hazard, flood or primary
mortgage insurance premiums, required to be paid by the related Mortgagor under
the terms of the related Mortgage Loan.

“Taxes” has the meaning set forth in Section 3.02.

“Termination Date” means the earliest of (i) the Maturity Date, (ii) the day on
which the MSR PC Repo Facility is terminated pursuant to Section 8.02(a) or
Section 8.02(b), or (iii) the Repurchase Date on which the final amounts owing
under the MSR PC Repo Facility are required to be paid as provided for in the
first sentence of Section 2.08(a) hereof.

“Test Period” has the meaning assigned to such term in the Pricing Side Letter.

“Transaction” has the meaning set forth in the Recitals.

“Transaction Notice” has the meaning set forth in Section 2.02(a).

“Transaction Notice Date” means the date on which the Seller shall deliver a
Transaction Notice, which shall be at least one (1) Business Day prior to the
date which the Seller has requested as a Purchase Date as provided therein.

 “UCC” means the Uniform Commercial Code as in effect on the date hereof in the
State of New York; provided that if by reason of mandatory provisions of law,
the perfection or the effect of perfection or non-perfection of the security
interest in any Repurchase Assets is governed by the Uniform Commercial Code as
in effect in a jurisdiction other than New York, “Uniform Commercial Code” means
the Uniform Commercial Code as in effect in such other jurisdiction for purposes
of the provisions hereof relating to such perfection or effect of perfection or
non-perfection.

“Uncollected Fees”  means with respect to any Mortgage Loan, any accrued late
charges, NSF fees, assumption fees, and other fees charged to Mortgagors in
connection with the servicing or subservicing of such Mortgage Loan which have
not been collected by the Seller as of the related Purchase Date.

17

 

“Unmatured Event of Default” means any event that, with the giving of notice or
lapse of time, or both, would become an Event of Default.

“U.S. Person” means any Person that is a “United States Person” as defined in
Section 77.01(a)(30) of the Code.

“VA” means the U.S. Department of Veterans Affairs, an agency of the United
States of America, or any successor thereto including the Secretary of Veterans
Affairs.

 

 

18

 

SCHEDULE II

ELIGIBILITY CRITERIA WITH RESPECT TO THE ELIGIBLE SERVICING RIGHTS

1.         All owned Servicing Rights for Mortgage Loans serviced by the Seller
on behalf of Fannie Mae, subject to the Acknowledgment Agreement (as identified
from time to time in accordance therewith), provided that such Servicing Rights
are free and clear of any Liens, subject to Fannie Mae’s interest in such
Servicing Rights pursuant to the Fannie Mae Servicing Contract and the
Acknowledgment Agreement acceptable in form and substance to the Buyer.

 

 

SCHEDULE II-1

 

SCHEDULE 4.01

ASSETS

Participation Certificate and Eligible Servicing Rights

Participation Certificate issued pursuant to the MSR Excess Spread Participation
Agreement, dated September 11, 2019, between PennyMac Loan Services, LLC, as
company, and PennyMac Loan Services, LLC, as initial participant, and the
Eligible Servicing Rights evidenced thereby.

 

 

SCHEDULE 4.01-1

 

SCHEDULE 5.01

CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS AGREEMENT

(a)         This Agreement duly executed by the parties hereto;

(b)         All other Facility Documents duly executed by the related parties;

(c)         A filed UCC-1 financing statement;

(d)         An incumbency certificate of the Seller and the Guarantor,
certifying the names and true signatures of the persons authorized on the
Seller’s  and the Guarantor’s behalf to sign, as applicable, this Agreement and
the other Facility Documents to be delivered by the Seller and the Guarantor in
connection herewith;

(e)         A certificate of a Responsible Officer of the Seller and the
Guarantor attaching copies of organizational documents, resolutions, and good
standing certificate of each Seller Party;

(f)         An Opinion of Counsel, delivered by outside counsel acceptable to
the Buyer in its reasonable discretion, opining as to: New York enforceability,
corporate matters and non-contravention, security interest, bankruptcy and the
Investment Company Act of 1940; provided that opinions as to corporate matters
and non-contravention may be given by the in-house counsel of the Seller;

(g)         An executed Acknowledgment Agreement and an opinion of counsel with
respect to such Acknowledgment Agreement;

(h)         A separate power of attorney of the Seller with respect to the
powers described in Section 4.04.

(i)          The delivery of an executed release by CSCIB, in form and substance
satisfactory to the Buyer, evidencing the release of its security interest in
the Fannie Mae Servicing Rights subject to the lien of the Conventional MSR Loan
Agreement;

(j)          The delivery of lien search reports with respect to the Seller
covering the five-year period prior to the date hereof; and

(k)         The due filing of a UCC financing statement on Form UCC-3, in form
and substance satisfactory to the Buyer, with respect to the UCC-1 original
financing statement file number 20180770541, filed by CSCIB with the Delaware
Secretary of State on February 2, 2018 with respect to the Seller.

 

 

SCHEDULE  5.01-1

 

SCHEDULE 5.02

CONDITIONS PRECEDENT TO EACH TRANSACTION

(a)         The Buyer shall have received a duly executed copy of the
Transaction Notice for such Transaction in accordance with Section 2.02;

(b)         Delivery of all reasonable due diligence (to the extent supplemental
due diligence is conducted by the Buyer with respect to such Transaction);

(c)         Entering into such Transaction, and the application of the proceeds
thereof, shall not result in the Repurchase Price exceeding the Maximum Purchase
Price;

(d)         Entering into such Transaction, and the application of the proceeds
thereof, shall not result in a Margin Deficit;

(e)         On the applicable Purchase Date, the following statements shall be
true (and the Seller by delivering such Transaction Notice shall be deemed to
have certified that):

(i) the representations and warranties set forth in Article VI are true and
correct in all material respects (except for on the Closing Date, in which case
the representations and warranties are true and correct on the Closing Date) on
and as of such day as though made on and as of such day and shall be deemed to
have been made on such day (except to the extent any such representation or
warranty is stated to relate solely to an earlier date, in which case, such
representation or warranty shall have been true and correct as of such date);

(ii)    the Seller is in compliance with all covenants set forth in Article VII;

(iii)  all conditions precedent to the entering into such Transaction have been
satisfied;

(iv)   no Default or Event of Default has occurred and is continuing, or would
result from such Transactions;

(v) all of the Servicing Rights included in the most recently delivered
Electronic File are Eligible Servicing Rights, except for any non-qualifying
Servicing Rights listed as such therein, and all Recourse Servicing Obligations
have been identified as such in a schedule attached to such Electronic File;

(f)         The Buyer shall have received (i) with respect to the Initial
Transaction, the initial Electronic File; and (ii) with respect to any
subsequent Transaction, a subsequent Electronic File on or prior to time
required by Section 2.02;

(g)         With respect to any Transaction Notice, the Acknowledgment Agreement
remains effective and in place with respect to which the related Servicing
Rights will be pledged under the Agreement and consents from all third parties,
including warehouse lenders, as needed,  except to the extent the foregoing have
already been received;

SCHEDULE  5.02-1

 

(h)         With respect to the Initial Transaction, an Opinion of Counsel,
delivered by outside counsel acceptable to the Buyer in its reasonable
discretion, opining as to: security interest creation, perfection and priority;

(i)          The Seller has maintained profitability of at least $1.00 in Net
Income for at least one of the two prior Test Periods; and

(j)          All Facility Documents shall continue to be in full force and
effect in all material respects.

 

 

SCHEDULE  5.02-2

 

SCHEDULE 6.01(s)

SELLER’S EXISTING FINANCING FACILITIES

[Attached]

 

 

SCHEDULE  6.01(s)-1

 

SCHEDULE 6.02(h)

REPRESENTATIONS AND WARRANTIES REGARDING THE PARTICIPATION CERTIFICATE

The Seller makes the following representations and warranties to the Buyer, with
respect to the Participation Certificate related to Servicing Rights subject to
each Transaction, as of the date of this Agreement, the date of any Transaction,
and while the Facility Documents are in full force and effect.  The
representations and warranties shall be limited to the Participation Certificate
related to Servicing Rights that are acquired on or after the date of this
Agreement.  For purposes of this Schedule and the representations and warranties
set forth herein, a breach of a representation or warranty shall be deemed to
have been cured with respect to the Participation Certificate related to
Servicing Rights if and when the Seller has taken or caused to be taken action
such that the event, circumstance or condition that gave rise to such breach no
longer adversely affects the Participation Certificate related to Servicing
Rights.

(a)        The Participation Certificate is a participation interest in the
Excess Spread evidenced by the Participation Certificate.

(b)        No (i) monetary default, breach or violation exists with respect to
any agreement or other document governing or pertaining to the Participation
Certificate, the related Excess Spread, (ii) material non-monetary default,
breach or violation exists with respect to the Participation Certificate, the
related Excess Spread, or (iii) event which, with the passage of time or with
notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration.

(c)        The Participation Certificate (i) is not dealt in or traded on a
securities exchange or in a securities market, (ii) does not by its terms
expressly provide that it is a Security governed by Article 8 of the UCC, (iii)
is not Investment Property or (iv) is not held in a Deposit Account.  For
purposes of this paragraph (c), capitalized terms undefined in this Agreement
have the meaning given to such term in the Uniform Commercial Code.

(d)        The Participation Certificate constitutes all the issued and
outstanding participation interests of all classes issued pursuant to the
Participation Agreement and is certificated.

(e)        The Participation Certificate has been duly and validly issued.

(f)        All consents of any Person required for the grant of the security
interests in the Participation Certificate to the Buyer provided for herein have
been obtained and are in full force and effect.

(g)        The Seller has not waived or agreed to any waiver under, or agreed to
any amendment or other modification of, the Participation Agreement without the
consent of the Buyer.

SCHEDULE  6.02(h)-1

 

(h)        Participation Agreement.

(i)         Each Participation Agreement with respect to such Assets is in full
force and effect and, except to the extent approved in writing by the Buyer, the
terms of the Participation Agreement have not been impaired, altered or modified
in any respect.

(ii)       A true and correct copy of the Participation Agreement has been
delivered to the Buyer.

(iii)      The Seller has complied with all terms of each Participation
Agreement subject to a Transaction hereunder and has fulfilled all obligations
with respect thereto.

(iv)       Except to the extent approved in writing by the Buyer, there is no
material default, breach, violation or event of acceleration existing under the
Participation Agreement and no event has occurred which, with the passage of
time or giving of notice or both and the expiration of any grace or cure period,
would constitute a material default, breach, violation or event of termination
thereunder, and the Seller has not waived any such default, breach, violation or
event of termination.

(v)        The Participation Agreement is genuine, and is the legal, valid and
binding obligation of the Seller enforceable in accordance with its terms,
except as such enforcement may be affected by bankruptcy, by other insolvency
laws or by general principles of equity.  The Seller had legal capacity to enter
into the Participation Agreement, and the Participation Agreement has been duly
and properly executed by the Seller and the Servicer.

Pursuant to the Participation Agreement, to the extent the sale would be
re-characterized, the Seller grants to the holder a valid security interest in
all the right, title and interest of the Seller in and to the Excess Spread,
which security interest is perfected and of first priority, enforceable against,
creating an interest prior in right to, all creditors of the Seller.

 

 

SCHEDULE  6.02(h)-2

 

SCHEDULE 7.01(BB)

MONTHLY REPURCHASE ASSETS REPORT

[PLS to provide information]

 

 

SCHEDULE  7.01(BB)-1

 

SCHEDULE 11.02

NOTICES

If to the Seller:

PennyMac Loan Services, LLC
3043 Townsgate Road
Westlake Village, CA 91361
Attention: Pamela Marsh/Josh Smith
Telephone: (805) 330-6059/ (818) 224-7078
Facsimile: (818) 936-0145
E-mail: pamela.marsh@pnmac.com; josh.smith@pnmac.com

With copies to:

PennyMac Loan Services, LLC
3043 Townsgate Road
Westlake Village, CA 91361
Attention: Derek Stark
Telephone: (818) 224-7050
Facsimile: (818) 936-0231
E-mail: derek.stark@pnmac.com

If to the Guarantor:

Private National Mortgage Acceptance Company, LLC
3043 Townsgate Road
Westlake Village, CA 91361
Attention: Pamela Marsh/Josh Smith
Telephone: (805) 330-6059/ (818) 224-7078
Facsimile: (818) 936-0145
E-mail: pamela.marsh@pnmac.com; josh.smith@pnmac.com

With copies to:

Private National Mortgage Acceptance Company, LLC
3043 Townsgate Road
Westlake Village, CA 91361
Attention: Derek Stark
Telephone: (818) 224-7050
Facsimile: (818) 936-0231
E-mail: derek.stark@pnmac.com

SCHEDULE 11.02-1

 

if to the Buyer:

Credit Suisse AG, Cayman Islands Branch
c/o Credit Suisse Securities (USA) LLC
Eleven Madison Avenue, 4th Floor
New York, New York  10010
Attention:  Margaret Dellafera
Phone Number: 212‑325‑6471
Fax Number:  212‑743‑4810
E‑mail: margaret.dellafera@credit‑suisse.com;
dominic.obaditch@credit-suisse.com; matthew.griffin@credit-suisse.com

With copies to:

Credit Suisse Securities (USA) LLC
Eleven Madison Avenue, 11th Floor
New York, NY  10010
Attention: General Counsel, Securitized Products

CSFBMC LLC – Operations
c/o Credit Suisse Securities (USA) LLC
Eleven Madison Avenue, 13th floor
New York, New York  10010
Attention: Christopher Bergs, Resi Mortgage Warehouse Ops
Phone:  212‑538‑5087
E‑mail: christopher.bergs@credit‑suisse.com;
list.afconduitreports@credit-suisse.com; agency.loanops@credit-suisse.com;
david.bankert@credit-suisse.com; jason.golz@credit-suisse.com

 

 

 

SCHEDULE 11.02-2

EXHIBIT 2.02

to Master Repurchase Agreement

FORM OF TRANSACTION NOTICE

[DATE]

Credit Suisse AG, Cayman Islands Branch
Eleven Madison Avenue, 4th Floor
New York, New York 10010
Attention: Margaret Dellafera

Attention: [ ]

Ladies and Gentlemen:

This [Initial] Transaction Notice is delivered to you pursuant to Section 2.02
of the Master Repurchase Agreement, dated as of September 11, 2019 (as amended,
supplemented, restated or otherwise modified from time to time, the “Repurchase
Agreement”), among PennyMac Loan Services, LLC, as seller (the “Seller”),
Private National Mortgage Acceptance Company, LLC, as guarantor (the
“Guarantor”), and Credit Suisse AG, Cayman Islands Branch, as buyer (the
“Buyer”). Unless otherwise defined herein or as the context otherwise requires,
terms used herein have the meaning assigned thereto under Schedule I of the
Repurchase Agreement.

The undersigned hereby requests that the Buyer enter into the following
Transaction(s) with the Seller as follows:

Purchase Price for Transaction     Amount of Asset Base     Outstanding
Repurchase Price

The requested Purchase Date is __________.

An updated Electronic File, revised to reflect the acquisition of any additional
Servicing Rights purchased by the Seller since the most recently delivered
Electronic File, has been delivered pursuant to Section 2.02 of the Purchase
Agreement. Such Electronic File reflects all Eligible Servicing Rights that
constitute Repurchase Assets under the terms and conditions of the Agreement and
a schedule of the mortgage loans related to the Servicing Rights identified in
Electronic File is attached hereto as Schedule One.

The Seller hereby acknowledges and agrees that (other than with respect to the
Repurchase Agreement) (i) the Servicing Rights currently pledged as Repurchase
Assets under the Repurchase Agreement and (ii) any of the Servicing Rights
identified on Schedule One attached hereto, are not currently assigned, pledged,
conveyed or encumbered under any credit, warehouse or financing facility. The
Seller further acknowledges and agrees that (other than under the Repurchase
Agreement) it shall not assign, pledge, convey or encumber such Servicing Rights
under any credit, warehouse or financing facility in the future, except with
prior notice to, and consent from, the Buyer.

EXHIBIT 2.02-1

 

The undersigned hereby acknowledges that the delivery of this [Initial]
Transaction Notice and the acceptance by the undersigned of the proceeds of the
Purchase Price requested hereby constitute a representation and warranty by the
undersigned that all conditions precedent to such Transaction specified in
Article V of the Repurchase Agreement have been satisfied and will continue to
be satisfied after giving effect to such Transaction.

The undersigned further represents and warrants that either (a) the Fannie Mae
Guide and the Servicing Contracts have not been materially modified since the
last date the undersigned delivered a Transaction Notice or (b) attached hereto
is a true and complete description of any changes to the applicable Servicing
Contracts since the last date the undersigned delivered a Transaction Notice.

Please wire transfer the proceeds of the Purchase Price to the following account
of the Seller pursuant to the following instructions:

[______________]

The undersigned has caused this [Initial] Transaction Notice to be executed and
delivered, and the certification and warranties contained herein to be made, by
its duly authorized officer this ____ day of _________, 20__.

 

 

PENNYMAC LOAN SERVICES, LLC, as the Seller

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

Acknowledged and agreed:

 

 

 

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

EXHIBIT 2.02-2

 

SCHEDULE ONE

ELECTRONIC FILE

[To be provided by the Seller.]

 

 

EXHIBIT 2.02-3

SCHEDULE TWO

ASSET SCHEDULE

Date of Asset Schedule: [____], 20[ ]

Assets:

MSR Excess Spread Participation Agreement, dated September 11, 2019, between
PennyMac Loan Services, LLC and PennyMac Loan Services, LLC, as initial
participant, and the Participation Certificate created thereunder.

 

 

EXHIBIT 2.02-1

 

EXHIBIT 2.08

FORM OF REPURCHASE NOTICE

[ ], 20__

TO:      The Buyer as defined in the Repurchase Agreement referred to below

Reference is hereby made to the Master Repurchase Agreement, dated as of
September 11, 2019 (as heretofore amended, the “Repurchase Agreement”), among
PennyMac Loan Services, LLC, as seller (the “Seller”), Private National Mortgage
Acceptance Company, LLC, as guarantor (the “Guarantor”), and Credit Suisse AG,
Cayman Islands Branch, as buyer (the “Buyer”). Capitalized terms not otherwise
defined herein are used herein as defined in the Repurchase Agreement.

The Seller hereby notifies you that, pursuant to Section 2.08(b) of the
Repurchase Agreement, it shall make a repayment of the Repurchase Price
outstanding under the Repurchase Agreement to the Buyer on [ ], 20__ in the
amount of $_____.

Also included in the repayment amount shall be accrued and unpaid Price
Differential, in the amount of $__________________.

[The attached Schedule I contains a list of the Participation Certificate and/or
related Eligible Servicing Rights that will be repurchased upon the repayment of
the Repurchase Price in full.]

EXHIBIT 2.08-1

 

The undersigned has caused this Repurchase Notice to be executed and delivered
by its duly authorized officer this_________ day of ____________, 20__.

 

 

PENNYMAC LOAN SERVICES, LLC, as Seller

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

EXHIBIT 2.08-2

 

SCHEDULE I

PARTICIPATION CERTIFICATE

[To be included]

 

EXHIBIT 2.08-3