Exhibit 10.32

 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

CITIGROUP GLOBAL MARKETS REALTY CORP
 390 Greenwich Street 5th Floor
 New York, NY 10013

 

	
 
    	
As of   July 12, 2011
    


 

	
TO:
    	
PennyMac   Corp. (“PMC” or “Purchaser”)
    
	
 
    	
 
    
	
FROM:
    	
Citigroup   Global Markets Realty Corp. (“Citigroup” or “Seller”)
    
	
 
    	
 
    
	
RE:
    	
Sale   of Assets to PMC
    


 

This letter agreement will serve as the commitment by Seller to sell and by Purchaser to purchase, on a mandatory delivery basis, without recourse, certain first lien, fixed-rate and adjustable-rate, conventional, residential mortgage loans (the “Mortgage Loans”) and certain residential real property including land and improvements, together with all buildings, fixtures and attachments thereto (the “REO Properties”, and together with the Mortgage Loans, the “Assets”) set forth on Schedule 1 attached hereto under the terms set forth below.  Purchaser will purchase all of Seller’s right, title and interest in the Assets.  The terms and provisions of this transaction, including the purchase price for the Assets, are described below.  Capitalized terms used herein and not defined shall have the meanings assigned thereto in the Agreement.

 

	
1.
    	
 
    	
Closing   Date:
    	
 
    	
The   Purchaser may purchase any Asset on any date following the date hereof, which   date shall be deemed a “Closing Date.” Any such Assets purchased on any   Closing Date shall be mutually agreed upon in writing by the parties hereto.   Any such Closing Date shall be agreed upon between the parties hereto in   writing, but in no event shall any Closing Date be later than December 26,   2011 (the “End Date”); provided, however, that in the event that aggregate   Original Purchase Price for all the Assets has decreased by thirty-five   percent (35%) or more due solely to the receipt of any principal and interest   collections on such Asset (collectively, “Proceeds”) and/or liquidation   proceeds by the Seller or sales to the Purchaser hereunder, the “End Date”   for purposes of this letter agreement shall be June 22, 2012.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
2.
    	
 
    	
Transfer   Date:
    	
 
    	
August 4,   2011, or such other date as may be mutually agreed upon by Citigroup and the   Initial Seller under the Interim Servicing Agreement, dated as of   June 29, 2011 (“Interim Servicing Agreement”), by and among such Initial   Seller, as servicer thereunder, Citigroup and PMC, as successor servicer   thereunder. 

 

The   “Initial Seller” shall mean the large money center bank from which Citigroup   purchased the Assets.
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

	
3.
    	
 
    	
Aggregate   Delivery Balance:
    	
 
    	
$347,692,993.00   (less any amounts attributable to Mortgage Loans that are repurchased by   Initial Seller pursuant to the terms and provisions of the Purchase   Agreement).
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
4.
    	
 
    	
Purchase   Price Percentage:
    	
 
    	
For   each Asset, the Base Purchase Price Percentage plus a percentage equal   to (i) in the event the related Closing Date shall occur within ***(**)   days from the date hereof, ***%, (ii) in the event the related Closing   Date shall occur within a period of *** (***) to *** (***) days from the date   hereof, ***%, (iii) in the event the related Closing Date shall occur   within a period of *** (***) to *** (***) days from the date hereof, ***%,   (iv) in the event the related Closing Date shall occur within a period   of *** (***) to *** (***) days from the date hereof, ***%, (v) in the   event the related Closing Date shall occur within a period of *** (***) to   *** (***) days from the date hereof, ***%, or (vi) in the event the   related Closing Date shall occur within a period of *** (***) to *** (***)   days from the date hereof, ***%. 

 

For   purposes of this letter agreement, the “Base Purchase Price Percentage” shall   mean, with respect to each Asset, the purchase price percentage set forth on   Schedule 1.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
5.
    	
 
    	
Purchase   Price:
    	
 
    	
The   purchase price for each Asset purchased on any related Closing Date (the   “Purchase Price”) shall be equal to (a) (i) the unpaid principal   balance of such Asset as of June 27, 2011 (the “Original Cut-off Date”),   multiplied by (ii) the related Purchase Price Percentage less   (b) any Proceeds received following ***, 2011 (the “Original Closing   Date”). In connection with the payment of the Purchase Price, Purchaser shall   pay any and all Reimbursement Amounts to Seller. If the amount in clause   (b) above exceeds the amount in clause (a) above (net of any   related Reimbursement Amounts), Seller shall remit such excess amount to   Purchaser. 

 

The   Purchase Price for any Assets or the excess amount after application of the   Purchase Price shall be paid to Seller or Purchaser, as applicable, in   immediately available funds by wire transfer on the related Closing Date.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
6.
    	
 
    	
Reimbursement   Amounts
    	
 
    	
With   respect to each Asset, the sum of (a) any and all out-of-pocket costs   and expenses incurred by Citigroup with respect to such Asset arising out of   or relating to this letter agreement, the Servicing Agreement, the Purchase   Agreement or the Interim Servicing Agreement, including, but not limited to,   servicing, corporate and escrow advances, servicing reimbursement made by   Citigroup, any servicing fees paid by Citigroup, any costs and expenses   incurred by Citigroup in 
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

	
 
    	
 
    	
 
    	
 
    	
connection   with its due diligence review of the Assets (allocated based upon the number   of Assets) and any other amounts paid to Initial Seller under the Purchase   Agreement or the Interim Servicing Agreement (other than the Original   Purchase Price for the Assets) or to PMC under the Servicing Agreement that   did not arise from ***thereunder and (b) Citigroup’s Cost of Carry for   such Asset. 

 

For   purposes of this letter agreement, the “Original Purchase Price” shall have   the meaning ascribed to the term “Purchase Price” in the Purchase Agreement.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
7.
    	
 
    	
Cost   of Carry:
    	
 
    	
An   amount equal to the “cost of carry” imputed to Citigroup in connection with   any Asset purchased under the Purchase Agreement and held by Seller equal to   the product of (x) the sum of (a) the Original Purchase Price for   such Asset as reduced monthly by remittances of principal on the Asset   received by Citigroup and (b) any and all Reimbursement Amounts incurred   by Citigroup (other than the Cost of Carry) with respect to such Asset and   (y) LIBOR plus *** (***) basis points per annum. 

 

For   the purposes hereunder, “LIBOR” shall mean the rate determined daily by   Citigroup on the basis of the offered rate for one-month U.S. dollar   deposits, as such rate appears on Reuters Screen LIBOR01 Page as of   11:00 a.m. (London time) on such date (rounded up to the nearest whole   multiple of 1/16%); provided that if such rate does not appear on Reuters   Screen LIBOR01 Page, the rate for such date will be the rate determined by   reference to such other comparable publicly available service publishing such   rates as may be selected by the Citigroup in its sole discretion and   communicated to PMC.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
8.
    	
 
    	
Liquidated   Assets:
    	
 
    	
With   respect to any Liquidated Asset, in the month following the liquidation date   of such Asset, following any required reconciliation that shall be performed   on such Asset by the parties, the Purchaser shall remit to Citigroup an   amount equal to (a) the product of (i) the Liquidation Percentage   and (ii) the unpaid principal balance of such Asset as of the Original   Cut-off Date, minus (b) the difference between (i) the total   amount of liquidation proceeds received on such Asset and (ii) the sum   of (1) the Original Purchase Price for such Asset, plus (2) any and   all Reimbursement Amounts for such Asset, minus (3) any Proceeds   on such Asset received following the Original Closing Date; provided,   however, if the amount in clause (b) above exceeds the amount in clause   (a) above, Citigroup shall remit such excess amount to Purchaser. 
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

	
 
    	
 
    	
 
    	
 
    	
For   the purposes of this letter agreement, “Liquidated Asset” shall mean an Asset   for which all amounts expected to be recovered (exclusive of the possibility   of recovery from deficiency judgments or default judgment) have been   recovered by the servicer, whether by way of disposition of an REO Property,   refinance, offer and compromise, charge-off or other means of liquidation.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
9.
    	
 
    	
Liquidation   Percentage:
    	
 
    	
The   positive difference between (i) the ***calculated as of the liquidation   date as if such Liquidated Asset was ***on such liquidation date and   (ii) the ***in respect of such Asset.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
10.
    	
 
    	
Assignment   Agreement:
    	
 
    	
The   Assets will be sold pursuant to a separate assignment, assumption and   recognition agreement to be entered into among Seller, Purchaser and Initial   Sellers (the “Assignment Agreement”) pursuant to which Seller will assign its   rights and obligations with respect to the Assets under that certain Mortgage   Loan Purchase Agreement, dated as of June 29, 2011 (the “Purchase   Agreement”), among Citigroup, as purchaser thereunder and Initial Sellers, as   sellers thereunder. The Assignment Agreement shall include indemnification   from PMC to Citigroup identical to that contained in Section 2(l) in   the Purchase Agreement.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
11.
    	
 
    	
Servicing   Agreement:
    	
 
    	
PMC   and Citigroup will, prior to the Transfer Date, enter into a mutually   acceptable servicing agreement pursuant to which PMC will service or cause to   be serviced the Assets (the “Servicing Agreement”). PMC shall purchase the   Mortgage Servicing Rights (“MSRs”) relating to the Assets prior to the   Transfer Date. PennyMac Loan Services, LLC (“PLS”) shall sub-service the   Assets for PMC in accordance with standards set forth in the Servicing   Agreement and shall be entitled, on a monthly basis, to withdraw funds from   the related collection account established under the Servicing Agreement to   pay itself any related servicing fees and to reimburse itself for any   permitted corporate, escrow or servicing advances made pursuant to the   Servicing Agreement prior to any other withdrawal therefrom. In the event   that, in any month, the funds in the collection account are insufficient for   the related servicer to pay itself such servicing fees and to reimburse   itself for such permitted corporate, escrow or servicing advances, Citigroup   shall remit to the servicer the amount of such shortfall as set forth in the   Servicing Agreement.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
12.
    	
 
    	
Further   Assurances:
    	
 
    	
Purchaser   and Seller further agree that upon reasonable request they shall do such   other and further acts and deeds, and shall execute, acknowledge and deliver   and record such other documents and instruments as may be reasonably   necessary 
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

	
 
    	
 
    	
 
    	
 
    	
from   time to time to evidence, confirm or carry out the intent and purposes of   this letter agreement.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
13.
    	
 
    	
Expenses:
    	
 
    	
Notwithstanding   anything to the contrary contained herein, each party will bear its own   costs, fees and expenses (including the costs, fees and expenses of its   attorneys). Purchaser will bear the cost of the delivery of the collateral   files to the custodian; the costs of preparing and recording the assignments   from Seller to Purchaser (including intervening assignments necessary to   perfect title to Purchaser) and endorsing notes to Purchaser, as required;   the costs of notifying the mortgagors, hazard, flood and mortgage insurance   companies, and others, as necessary, and the costs of shipping all Asset   records to Purchaser.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
14.
    	
 
    	
Entire   Agreement:
    	
 
    	
This   letter agreement sets forth the entire understanding of the parties relating   to the subject matter hereof to date and supersedes and cancels any prior   communications, understandings and agreements between the parties. This   letter agreement may not be amended or modified except by the parties in   writing. This letter agreement may be simultaneously executed in several   counterparts, each of which shall be deemed to be an original, and all such   counterparts shall together constitute but one and the same agreement.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
15.
    	
 
    	
Liquidated   Damages:
    	
 
    	
If   for any reason Purchaser fails to purchase any Asset by the End Date, in   addition to any other amounts owed under this letter agreement, Purchaser   shall, as liquidated damages for such failure, remit to Seller an amount   equal to (a) the product of (i) the Spread Percentage and   (ii) the unpaid principal balance of such Asset as of the Original   Cut-off Date, minus (b) the difference between (i) the fair   market value of the Assets (as determined pursuant to a third party   indicative bid obtained by Citigroup within a reasonable period of time   following the related Break-up Date) or, with respect to any Liquidated   Asset, the total amount of liquidation proceeds received on such Asset and   (ii) the sum of (1) the Original Purchase Price for such Asset,   (2) any and all Reimbursement Amounts for such Asset, minus   (3) any Proceeds on such Asset received following the Original Closing   Date; provided, however, if the amount in clause (b) above exceeds the   amount in clause (a) above, Seller shall remit such excess amount to   Purchaser. 

 

Purchaser   shall promptly provide Citigroup with any information on the Assets that it   requires in connection with Citigroup’s obtaining the related third party   indicative bid. 
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

	
 
    	
 
    	
 
    	
 
    	
For   purposes of this letter agreement, the “Break-up Date” shall mean the earlier   to occur of (i) the date on which ***in ***of its ***or ***to ***an   ***as ***under this letter agreement and (ii) the ***.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
16.
    	
 
    	
Spread   Percentage:
    	
 
    	
The   positive difference between (i) the ***calculated as of the Break-up   Date as if such Asset was ***on the Break-up Date and (ii) the ***in   respect of such Asset.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
17.
    	
 
    	
Disposition   of Assets:
    	
 
    	
Purchaser   acknowledges and agrees that Seller shall, in its sole discretion, be   permitted to sell or dispose of any Asset (or otherwise obtain a third party   indicative bid for the Assets within a reasonable period of time following   any Break-up Date) at any price and at any time that it, in its sole   discretion, deems reasonable and Purchaser waives any right to object to or   contest the price obtained by Seller in the sale, disposition and/or third   party indicative bid of any Asset.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
18.
    	
 
    	
Severability:
    	
 
    	
If   any provision hereof is found by a court of competent jurisdiction to be prohibited   or unenforceable, such provision shall be ineffective only to the extent of   such prohibition or unenforceability, and such prohibition or enforceability   shall not invalidate the balance of such provision to the extent it is not   prohibited or unenforceable, nor invalidate the other provisions hereof.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
19.
    	
 
    	
Governing   Law:
    	
 
    	
The   parties agree that this letter agreement shall be construed in accordance   with and governed by the laws of the State of New York, excluding its   rules of conflicts of laws but including the New York General   Obligations Law Sections 5-1401 and 5-1402. The parties consent to the   exclusive jurisdiction of the following courts in connection with any dispute   between the Parties arising from or in connection with this letter agreement   (i) United States District Court for the Southern District of New York;   and (ii) Supreme Court, New York County, New York. Purchaser hereby   irrevocably waives any objection to venue of any action between the parties   in the courts described herein, whether pursuant to the doctrine of forum non   conveniens or otherwise. In the event Seller commences legal proceedings   against Purchaser in any of the courts set forth above, Purchaser waives any   objection to the selection of that court and shall not seek to change venue   to any other court.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
20.
    	
 
    	
Arm’s   Length Transaction:
    	
 
    	
Each   party acknowledges that it has participated in the negotiation of this letter   agreement, and agrees that no provision of this letter agreement shall be   construed against or interpreted to the disadvantage of any party by any   court or 
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

	
 
    	
 
    	
 
    	
 
    	
other   governmental or judicial authority by reason of such party having or being   deemed to have structured, dictated or drafted such provision. All of the   terms of this letter agreement were negotiated at arm’s length, and were   prepared and executed without fraud, duress, undue influence or coercion of   any kind exerted by either party upon the other. The execution and delivery   of this letter agreement is the free and voluntary act of Seller and   Purchaser.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
21.
    	
 
    	
Confidentiality:
    	
 
    	
Each   party agrees for itself and its respective directors, officers, employees,   agents, representatives, subsidiaries and affiliates, to keep the terms of   this letter agreement confidential and to not disclose any such terms to   anyone except: (a) in connection with the enforcement of this letter   agreement, (b) to the parties’ respective attorneys, accountants and/or   regulators who have specific need for the information; or (c) in response   to or to otherwise comply with appropriate legal process, law, regulation or   governmental agency request.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
22.
    	
 
    	
Miscellaneous:
    	
 
    	
The   rights granted hereunder shall be cumulative with the rights provided under   the Assignment Agreement and shall inure to the benefit of Seller and its   successors and assigns. For the purpose of facilitating the execution of this   letter agreement, and for other purposes, this letter agreement may be   executed simultaneously in any number of counterparts. Each counterpart shall   be deemed to be an original, and all such counterparts shall constitute one   and the same instrument. The parties intend that faxed signatures and   electronically imaged signatures such as .pdf files shall constitute original   signatures and are binding on all parties. The original documents shall be   promptly delivered, if requested.
    


 











 

CONFIDENTIAL MATERIAL APPEARING IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND RULE 24B-2 PROMULGATED THEREUNDER. OMITTED INFORMATION HAS BEEN REPLACED WITH ASTERISKS

 

Please acknowledge your acceptance and agreement to the foregoing by signing and returning this letter agreement via email and overnight courier to Peter Steinmetz (email: peter.steinmetz@citi.com) at Citigroup Global Markets Realty Corp., 390 Greenwich Street, 5th Floor, New York, NY 10013.  Thank-you.

 

	
 
    	
 
    	
Very   Truly Yours,
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
CITIGROUP   GLOBAL MARKETS REALTY CORP.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
BY:
    	
/s/   Kira Granovskaya
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
NAME:   Kira Granovskaya
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
TITLE:   Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
CONFIRMED   AND AGREED TO:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
PENNYMAC   CORP.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
BY:
    	
/s/   Vandad Fartaj
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
NAME:
    	
Vandad   Fartaj
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
TITLE:
    	
Chief   Investment Officer
    	
 
    	
 
    


 

Confirmation (July 2011)

 











 

Schedule 1

 

Assets