PennyMac Financial Services, Inc. (NYSE:PFSI) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01Entry into a Material Definitive Agreement.

Third Amended and Restated Master Repurchase Agreement

On April 28, 2017, PennyMac Financial Services, Inc. (the
Company), through two of its subsidiaries, PennyMac Loan
Services, LLC (PLS) and Private National Mortgage Acceptance
Company, LLC (PNMAC), entered into a Third Amended and Restated
Master Repurchase Agreement with Credit Suisse First Boston
Mortgage Capital LLC, as administrative agent to the buyers
(CSFB), Credit Suisse AG, Cayman Islands Branch, as a buyer (CS
Cayman or CS Buyer), and Alpine Securitization LTD, as a buyer
(Alpine or CS Buyer, and, together with CS Cayman, the CS
Buyers)(the Repurchase Agreement).

The Repurchase Agreement is committed to April 27, 2018 and,
together with that certain master repurchase agreement dated as
of December 19, 2016 (the VFN Repurchase Agreement) with CSFB, as
administrative agent, and CS Cayman, as purchaser, to which PLS
sold to CS Cayman that certain Series 2016-MSRVF1 Variable
Funding Note, datedDecember 19, 2016 (the VFN), provides for a
maximum combined purchase price of $1.5 billion. The maximum
combined committed purchase price under the Repurchase Agreement
and the VFN Repurchase Agreement is $700 million, all of which is
committed and available for purchases under the Repurchase
Agreement to the extent not reduced by purchased amounts
outstanding under the VFN Repurchase Agreement. The obligations
of PLS under the Repurchase Agreement are fully guaranteed by
PNMAC.

to the terms of the Repurchase Agreement, PLS may sell to, and
later repurchase from, CS Buyer (i) certain newly originated
residential and small balance multifamily mortgage loans and
recently acquired Ginnie Mae early buyout mortgage loans, and
(ii) mortgage servicing advances made by PLS in connection with
certain Ginnie Mae early buyout mortgage loans. The principal
amount paid by CS Buyer for each eligible mortgage loan is based
on a percentage of the lesser of the market value or unpaid
principal balance of such mortgage loan. Upon PLS repurchase of a
mortgage loan or mortgage servicing advances, it is required to
repay CS Buyer the principal amount related to such mortgage loan
or mortgage servicing advances, as applicable, plus accrued
interest (at a rate reflective of the current market and based on
either CS Buyers cost of funds or LIBOR plus a margin) to the
date of such repurchase. The Company, through PLS, is required to
pay CSFB a commitment fee relating to the amendment, as well as
certain other administrative costs and expenses.

The Repurchase Agreement requires that PLS maintain various
financial and other covenants, which include maintaining (i)a
minimum adjusted tangible net worth of $500 million, (ii)a
minimum of $40 million in unrestricted cash and cash equivalents,
(iii)a maximum ratio of total liabilities to adjusted tangible
net worth of less than 10:1, and (iv)profitability for at least
one (1) of the previous two (2) consecutive fiscal quarters, as
of the end of each fiscal quarter.

The Repurchase Agreement also contains margin call provisions
that provide CS Buyers with certain rights in the event of a
decline in the market value of the purchased mortgage loans.
Under these provisions, CS Buyers may require PLS to transfer
cash or additional eligible mortgage loans with an aggregate
market value in an amount sufficient to eliminate any margin
deficit resulting from such a decline.

In addition, the Repurchase Agreement containsevents of default
(subject to certain materiality thresholds and grace periods),
including payment defaults, breaches of covenants and/or certain
representations and warranties, cross-defaults, guarantor
defaults, servicer termination events, material adverse changes,
bankruptcy or insolvency proceedings and other events of default
customary for this type of transaction. The remedies for such
events of default are also customary for this type of transaction
and include the acceleration of the principal amount outstanding
and the liquidation by CS Buyers of the mortgage loans then
subject to the Repurchase Agreement.

The foregoing descriptions of the Repurchase Agreement and the
related guaranty do not purport to be complete and are qualified
in their entirety by reference to the full text of the Third
Amended and Restated Master Repurchase Agreement and Amended and
Restated Guaranty, which have been filed with this Current Report
on Form 8-K as Exhibits 10.1 and Exhibit 10.2, respectively. The
foregoing descriptions of the VFN Repurchase Agreement and
related transactions do not purpose to be complete and are
qualified in their entirety by reference to (i) the description
of the VFN Repurchase Agreement in the Companys Current Report on
Form 8-K as filed on December 21, 2016 and the full text of the
VFN Repurchase Agreement attached thereto as Exhibit 10.9; and
(ii) the description of the transactions related to the VFN
Repurchase Agreement in the Companys Current Report on Form 8-K
as filed on February 23, 2017.

About PennyMac Financial Services, Inc. (NYSE:PFSI)

PennyMac Financial Services, Inc. (PFSI) is a financial services company. The Company is focused on the production and servicing of the United States residential mortgage loans and the management of investments related to the United States mortgage market. It operates through three segments: loan production, loan servicing and investment management. Its loan production segment is sourced through approximately two channels: correspondent production and consumer direct lending. Its loan servicing segment performs loan administration, collection and default management activities, including the collection and remittance of loan payments; response to customer inquiries; accounting for principal and interest; counseling delinquent mortgagors, and supervising foreclosures and property dispositions. Its investment management segment represents the activities of the Company’s investment manager, which include sourcing, performing diligence, bidding and closing investment asset acquisitions.

PennyMac Financial Services, Inc. (NYSE:PFSI) Recent Trading Information

PennyMac Financial Services, Inc. (NYSE:PFSI) closed its last trading session up +0.40 at 17.20 with 140,659 shares trading hands.