| Item 1.01. | Entry into a Material Definitive Agreement. |
On June 27, 2024, PennyMac Mortgage Investment Trust (the “Company”), through four of its indirect, wholly owned subsidiaries, PMT ISSUER TRUST - FMSR (“Issuer Trust”), PMT CO-ISSUER TRUST I – FMSR (“Co-Issuer Trust”), PennyMac Corp. (“PMC”), and PennyMac Holdings, LLC (“PMH”) issued an aggregate principal amount of $355 million in secured term notes (the “Series 2024-FT1 Term Notes”) as part of the structured finance transaction that PMC and PMH use to finance Fannie Mae mortgage servicing rights and related excess servicing spread and servicing advance receivables. The Company entered into a Series 2024-FT1 Indenture Supplement relating to the mortgage servicing rights and excess servicing spread, by and among Issuer Trust and Co-Issuer Trust, as co-issuers, PMC, as administrator and servicer, PMH, as co-issuer administrator, Citibank, N.A., as indenture trustee (“Citibank”), calculation agent, paying agent and securities intermediary, Atlas Securitized Products, L.P., as administrative agent (“ASP”), and the noteholders thereto (the “Series 2024-FT1 Indenture Supplement”). The initial 3-and-a-half-year term of the Series 2024-FT1 Term Notes are set to mature on December 27, 2027, unless the Company exercises a six-month optional extension.
The Series 2024-FT1 Term Notes provide more financing for Fannie Mae mortgage servicing rights and related excess servicing spread in addition to (i) the previously issued Series 2021-FT1 and Series 2022-FT1 term notes (the “Term Notes”), (ii) the Master Repurchase Agreement, dated as of March 15, 2024, among PMC FMSR VFN Funding, LLC, PMH FMSR VFN Funding, LLC, PMC, PMH, the buyers from time-to-time party thereto, and Goldman Sachs Bank, USA, (iii) the Series 2023-FTL1 Loan Agreement and Indenture Amendment, and (iv) that certain Amended and Restated Series 2017-VF1 Master Repurchase Agreement by and among PMC, as seller, ASP, as administrative agent to the buyers, Nexera Holding LLC, as an assignee buyer, and Citibank, as a buyer, dated June 29, 2018.
The initial note balance of the Series 2024-FT1 Term Notes is $355 million. During the term of the loan, PMC and PMH are required to pay the noteholders monthly accrued interest (at a rate reflective of the current market based on a spread above the Secured Overnight Financing Rate). The Series 2024-FT1 Term Notes rank pari passu with the other Term Notes, variable funding notes, and term loans previously issued as part of the structured finance transaction.
The Series 2024-FT1 Indenture Supplement requires that PMC, PMH, the Issuer Trust, and the Co-Issuer Trust make certain representations, warranties and covenants customary for this type of transaction. The Series 2024-FT1 Term Notes also contain certain advance rate reduction events, early amortization events, and scheduled principal payment events (subject to certain thresholds) that would require the Issuer Trust and the Co-Issuer Trust to make early payments of principal on the Series 2024-FT1 Term Notes. In addition, the Base Indenture, dated as of December 20, 2017, contains margin call provisions and events of default (subject to certain materiality thresholds and grace periods) that apply to the Series 2024-FT1 Term Notes, including payment defaults, breaches of covenants and/or certain representations and warranties, cross-defaults, guarantor defaults, bankruptcy or insolvency proceedings and other events of default customary for this type of transaction. The remedies for such events of default include the acceleration of the principal amount outstanding under the Series 2024-FT1 Term Notes.
The foregoing descriptions do not purport to be complete and are qualified in their entirety by reference to the other descriptions and the full text of the agreements and amendments in the following: (i) the Series 2024-FT1 Indenture Supplement, which has been filed with this Current Report on Form 8-K as Exhibit 10.1; (ii) the Series 2024-VF1 Indenture Supplement, Series 2024-VF1 Note and Guaranty, as filed in the Company’s Form 8-K on March 20, 2024 as Exhibits 10.1, 10.2, and 10.3, respectively; (iii) the Joinder Amendment and Indenture Amendment, as filed in the Company’s Form 8-K on August 16, 2023 as Exhibits 10.1 and 10.2, respectively; (iv) Series 2023-FTL1 Loan Agreement and Indenture Amendment, as filed in the Company’s Form 8-K on June 1, 2023 as Exhibits 10.1 and 10.2, respectively; (v) the full text of the Joint Assignment, Assumption and Amendment No. 7 to the Series 2017-VF1 Repurchase Agreement, Amendment No. 1 to the Series 2017-VFI Pricing Side Letter, Amendment No. 3 to the Series 2017-VF1 Side Letter Agreement and Amendment No. 1 to the VFN Repo Guaranty, as filed in the Company’s Form 8-K on March 17, 2023 as Exhibit 10.2; (vi) the full text of Amendment No. 5, dated as of June 28, 2022, to the Base Indenture as filed in the Company’s Form 8-K on July 5, 2022 as Exhibit 10.1; (vii) the full text of Amendment No. 4, dated as of March 30, 2021, to the Base Indenture as filed in
