Exhibit 10.1
EXECUTION COPY

PMT ISSUER TRUST – FMSR ,

as Issuer

and

Citibank, N.A.,

as Indenture Trustee, Calculation Agent, Paying Agent and Securities Intermediary

and

PENNYMAC CORP.

as Servicer and Administrator

and

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC

as Administrative Agent

__________

AMENDMENT NO. 1
Dated as of April 25, 2018

to the

Base Indenture
Dated as of December 20, 2017

60958.000218 EMF_US 68791706v24

This Amendment No. 1 (this “ Amendment ”) to the Base Indenture ( as defined below) is entered into as of April 25, 2018 , by and among PMT ISSUER TRUST – FMSR , a statutory trust organized under the laws of the State of Delaware (the “ Issuer ”), CITIBANK, N.A. (“ Citibank ”), a national banking association, in its capacity as Indenture Trustee (the “ Indenture Trustee ”), and as calculation agent, paying agent and securities intermediary, PENNYMAC CORP., a corporation organized under the laws of the State of Delaware (“ PMC ”), as servicer and as administrator, and CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC (“ CSFB ”), a Delaware limited liability company, as an administrative agent (in such capacity, the “ Administrative Agent ”), and is consented to by CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Noteholder (the “ Noteholder ”).  Capitalized terms used but not otherwise defined herein shall have the meanings assigned to them in the Existing Base Indenture (as defined below).  

W I T N E S S E T H:

WHEREAS, the Issuer, Citibank, as Indenture Trustee, as calculation agent (in such capacity, the “ Calculation Agent ”), as paying agent (in such capacity, the “ Paying Agent ”) and as securities intermediary (in such capacity, the “ Securities Intermediary ”), the Administrator, the Servicer and the Administrative Agent are parties to that certain Base Indenture, dated as of December 20, 2017 (as amended, restated, supplemented, or otherwise modified from time to time, the “ Existing Base Indenture ”);

WHEREAS, the Issuer, the Indenture Trustee, the Administrator, the Servicer and the Administrative Agent have agreed, subject to the terms and conditions of this Amendment, that the Existing Base Indenture be amended to reflect certain agreed upon revisions to the terms of the Existing Base Indenture;

WHEREAS, pursuant to Section 12.2 of the Existing Base Indenture, the Issuer, the Indenture Trustee, the Administrator, the Servicer and the Administrative Agent, with prior notice to each Note Rating Agency, if applicable, and the consent of the Majority Noteholders of each Series materially and adversely affected by such amendment of the Existing Base Indenture, by Act of said Noteholders delivered to the Issuer, the Administrator, the Servicer, the Administrative Agent and the Indenture Trustee, upon delivery of an Issuer Tax Opinion (unless the Noteholders unanimously consent to waive such opinion), may enter into an amendment of the Existing Base Indenture for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, the Base Indenture or modifying in any manner the rights of the Noteholders of the Notes of each such Series or Class under the Existing Base Indenture;

WHEREAS, pursuant to Section 12.3 of the Existing Base Indenture, the Issuer shall also deliver to the Indenture Trustee an Opinion of Counsel stating that the execution of such amendment to the Existing Base Indenture is authorized and permitted by the Existing Base Indenture and that all conditions precedent thereto have been satisfied (the “ Authorization Opinion ”), and pursuant to Section 1.3 of the Existing Base Indenture, the Issuer will furnish to the Indenture Trustee (1) an Officer’s Certificate stating that all conditions precedent, if any, provided for in this Base Indenture relating to the proposed action have been complied with and (2) except as provided below, an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with;

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WHEREAS, pursuant to Section 11.1 of the Trust Agreement, prior to the execution of any amendment to any Transaction Documents to which the Trust is a party, the Owner Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by the Trust Agreement and that all conditions precedent have been met;

NOW THEREFORE, in consideration of the premises and mutual agreements herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Issuer, the Indenture Trustee, the Administrator, the Servicer and the Administrative Agent hereby agree as follows:

SECTION 1.   Amendments to the Existing Base Indenture .  

(a) Section 1.6(a) of the Existing Base Indenture is hereby amended by deleting the terms “or (v)” at the end of clause (iv) thereof and replacing it with the following:

(v) in the case of the Disposition Manager, Pentalpha Surveillance LLC, 375 N. French Rd., Suite 100, Amherst, New York, 14228, Attention: PMT ISSUER TRUST - FMSR, email: notices@pentalphasurveillance.com; or (vi)

(b) Section 3.1 of the Existing Base Indenture is hereby amended by deleting subsection (a) in its entirety and replacing it with the following:

(a) General .  The Calculation Agent shall initially be Citibank.  The Calculation Agent is appointed for the purpose of making calculations and verifications as provided in this Section 3.1(a) .  The Calculation Agent, as agent for the Noteholders, shall provide all services necessary to fulfill the role of Calculation Agent as set forth in this Base Indenture.

By no later than 1:00 p.m. New York City time on the first (1st) Business Day prior to each Interim Payment Date or Payment Date, as applicable, the Administrator shall prepare and deliver to the Calculation Agent, the Indenture Trustee, the Paying Agent, the Administrative Agent and the VFN Noteholders a report (the “ Administrator’s Calculation Report ”) containing the detailed information described in this Section 3.1(a) and pursuant to Section 3.2(b) .    

By 2:00 p.m. New York City time on each Payment Date (or such other time as may be agreed to from time to time by the Servicer, the Administrator, the Indenture Trustee and the Administrative Agent), based upon the Administrator’s Calculation Report and any additional information provided to the Indenture Trustee and the Calculation Agent by the Administrator pursuant to the Fannie Mae Lender Contract and the Transaction Documents, as well as each applicable Determination Date Report, all available reports issued by the Servicer, the Market Value Report issued by the MSR Valuation Agent and any report issued as to the Market Value of any Eligible Securities (to the extent any Eligible Securities are on deposit in the Eligible Securities Account) as of the Determination Date, the Calculation Agent shall perform certain calculations and verifications as follows:

(i) an indication (yes or no) as to whether a Borrowing Base Deficiency exists as of the close of business on the last day of the related Collection Period preceding the upcoming Payment Date;

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(ii) if the Full Amortization Period is in effect, the Series Available Funds for each Series for the upcoming Payment Date;

(iii) if required by any VFN Noteholder, the aggregate Funding Amount to be paid on the upcoming Funding Date, and the amount to be drawn on each Class of VFNs Outstanding in respect of such Funding Amount, and the portion of such Funding Amount that is to be paid using Available Funds pursuant to Section 4.5(a)(1)(viii) ;

(iv) if any Note is Outstanding, the amount, if any, to be paid on each such Class in reduction of the aggregate principal balance on the upcoming Payment Date;

(v) the amount of Fees to be paid on the upcoming Payment Date, the amount remaining before the applicable Expense Limit is reached (before and after giving effect to such payments), and, if applicable, any amounts in excess of the Expense Limit to be carried forward to a subsequent year or Payment Date;

(vi) the Required Available Funds, the Expense Reserve Required Amount and the Series Reserve Required Amount, if applicable, for each Series of Notes for the upcoming Payment Date;

(vii) the Weighted Average Advance Rate for the facility to be used in calculating whether a Borrowing Base Deficiency exists and for each Series and Class of Variable Funding Notes;

(viii) the Series Invested Amount and, if applicable, the Class Invested Amount for each Series and Class for the upcoming Payment Date;

(ix) the Interest Payment Amount, the Default Supplemental Fee and the Step-Up Fee for each Class of Outstanding Notes for the upcoming Payment Date, and the Interest Amount, the Cumulative Interest Shortfall Amount, the Cumulative Default Supplemental Fee Shortfall Amount and the Cumulative Step-Up Fee Shortfall Amount for each Class of Notes for the Interest Accrual Period related to the upcoming Payment Date;

(x) an indication (yes or no) as to whether an Advance Rate Trigger Event, Early Amortization Event or Event of Default hereunder has occurred; and

(xi) verification of the calculation of the Stop-Loss Cap and the Stop-Loss Cap Required Amount for the upcoming Payment Date as of the last day of the immediately preceding month, which shall be calculated by PMC on a monthly basis and on a quarterly basis will be calculated using the SDQ Rate provided by Fannie Mae for such quarter to the extent available from Fannie Mae.

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The Calculation Agent does not receive any loan data or financial information independent from what is supplied to it by the Administrator.  Thus, any components of the calculations or verifications to be performed by the Calculation Agent that require loan data information, including pool balance,  SDQ balance, and non-SDQ loan balances,  as well as any financial statement data (including any PIPs), are taken as provided by the Administrator without verification or recalculation.

(c) Section 3.2 of the Existing Base Indenture is hereby amended by deleting the second paragraph of subsection (a) in its entirety and replacing it with the following:

By no later than 10:00 a.m. New York City time on the first (1 ^st ) Business Day prior to each Funding Date that is an Interim Payment Date and by no later than 2:00 p.m. New York City time on the second (2 ^nd ) Business Day prior to each Funding Date that is a Payment Date (or such other time as may be agreed to from time to time by the Administrator, the Indenture Trustee and the Administrative Agent), the Administrator shall prepare and deliver to the Issuer, the Indenture Trustee, the Calculation Agent, the Administrative Agent, each VFN Noteholder and the Paying Agent a report (the “ Determination Date Report ”) (in electronic form) setting forth (i) each data item required to be reported pursuant to Section 4.3 , (ii) the information reported in the Administrator’s Calculation Report, and (iii) any additional information necessary to prepare the Payment Date Report pursuant to Section 3.2(b) .

(d) Section 3.2 of the Existing Base Indenture is hereby amended by deleting subsection (b) in its entirety and replacing it with the following:

(b) Payment Date Report .  By 2:00 p.m. New York City time on each Payment Date (or such other time as may be agreed to from time to time by the Servicer, the Administrator, the Indenture Trustee and the Administrative Agent), based upon information provided to the Indenture Trustee and the Calculation Agent by the Administrator pursuant to the Fannie Mae Lender Contract and the Transaction Documents and contained in the Administrator’s Calculation Report, as well as each applicable Determination Date Report, all available reports issued by the Servicer, the Market Value Report issued by the MSR Valuation Agent and any report issued as to the Market Value of any Eligible Securities (to the extent any Eligible Securities are on deposit in the Eligible Securities Account) as of the Determination Date, the Indenture Trustee shall make available on its website to the Issuer, the Calculation Agent, the Administrator, the Paying Agent, the Administrative Agent, each Noteholder and each Note Rating Agency, and solely during the Default Period, the Disposition Manager, a report (the “ Payment Date Report ”) reporting the following for such Payment Date and the related Collection Period preceding such Payment Date:

(i) the amount of Available Funds and Required Available Funds for such Payment Date (segregating out any cash amounts that are on deposit in the Collection and Funding Account which the Administrator has instructed the Indenture Trustee to use in accordance with Section 4.5(a)(1)(viii) );

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(ii) (A) the aggregate amount of all Collections received and deposited into the Collection and Funding Account during such Collection Period and (B) the Total Collections for such Payment Date;

(iii) all Funding Amounts paid during such Collection Period separately identifying the portion thereof paid from funds in the Collection and Funding Account and the portion thereof paid using proceeds of fundings of an increase in VFN Principal Balance(s) for each Class of VFNs;

(iv) the amount on deposit in any Trust Accounts set forth under any Indenture Supplement as of the close of business on the last Payment Date;

(v) the amount on deposit in the Series Reserve Account for each Series, and, if applicable, the amount the Indenture Trustee is to withdraw from each such Series Reserve Account and deposit into the Note Payment Account on such Payment Date for application to the related Series of Notes;

(vi) the amount on deposit in the Expense Reserve Account, and, if applicable, the amount the Indenture Trustee is to withdraw from the Expense Reserve Account and deposit into the Note Payment Account on such Payment Date for application to the related Series of Notes;

(vii) the amount of each payment required to be made by the Indenture Trustee or the Paying Agent pursuant to Section 4.5 on such Payment Date;

(viii) the unpaid Note Balance for each Class and Series of Notes and for all Outstanding Notes in the aggregate (before and after giving effect to any principal payments to be made on such Payment Date);

(ix) a statement indicating whether a Borrowing Base Deficiency existed at such time and whether it will exist as of the close of business on such Payment Date after all payments and distributions described in Section 4.5(a) ;

(x) any Eligible Securities as of the Determination Date and the unpaid principal balance of the Portfolio;

(xi) (A) the aggregate Available Funds collected, separately identifying (1) the aggregate Retained MSR Excess Spread, Retained MSR Excess Spread Collections, the Sold MSR Excess Spread and the Total Collections included therein, and (2) the aggregate amount of proceeds collected during the Collection Period preceding the upcoming Payment Date for all Participation Certificates less any amounts distributed on any Interim Payment Date during such Collection Period; and (B) separately identifying any PMH Repurchase Price, PMC Repurchase Price and any payments under the PC Repo Guaranty; and

(xii) an indication (yes or no) as to whether Servicer is in compliance with the following Fannie Mae servicer eligibility requirements (collectively, the “ Fannie Mae Eligibility Requirements ”):

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(A) its Lender Adjusted Net Worth is equal to or greater than the lender adjusted net worth required by the Fannie Mae Lender Contract;

(B) its Lender Adjusted Net Worth to total assets ratio is equal to or less than the minimum capital required by the Fannie Mae Lender Contract;

(C) its Liquidity is equal to or greater than the liquidity requirement set forth in the Fannie Mae Lender Contract; and

(D) an indication (yes or no) as to whether a Servicer Termination Event has occurred.

The Payment Date Report shall also state any other information required pursuant to any related Indenture Supplement necessary for the Paying Agent and the Indenture Trustee to make the payments required by Section 4.5(a) and all information necessary for the Indenture Trustee to make available to Noteholders pursuant to Section 3.5 .

On each day on which a Payment Date Report is to be delivered, PMC shall deliver to the Indenture Trustee a certification substantially in the form attached hereto as Exhibit F .

Noteholders of any Series of Term Notes shall receive solely the Payment Date Report and shall not receive the Market Value Report prepared by the MSR Valuation Agent.

(e) Section 3.2(c) of the Existing Base Indenture is hereby amended by inserting the following at the end of the first clause thereof, following “not yet begun” and preceding the first comma:

and on which payments pursuant to clause (iii) with respect to a Class of Notes are being made

(f) Section 3.3 of the Existing Base Indenture is hereby amended by deleting subsection (b) in its entirety and replacing it with the following:

(b) Notice of Advance Rate Trigger Event, Early Amortization Event or Event of Default . The Indenture Trustee shall deliver to the Noteholders, the Issuer, the Disposition Manager, Fannie Mae (in connection with an Event of Default only) and each Note Rating Agency, promptly after a Responsible Officer has obtained actual knowledge thereof, but in no event later than five (5) Business Days thereafter or such shorter time period as may be required by any Note Rating Agency, written notice specifying the nature and status of any Advance Rate Trigger Event, Early Amortization Event or any Event of Default, as applicable.

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(g) Section 3.3 of the Existing Base Indenture is hereby amended by deleting subsection (g) in its entirety and replacing it with the following:

(g) Market Value Report.   The MSR Valuation Agent shall calculate the fair market value and the valuation percentage of the MSRs, the Portfolio Excess Spread and the Base Servicing Fee on each Borrowing Base Determination Date in accordance with the MSR Valuation Agent Agreement.  The MSR Valuation Agent shall deliver to the Indenture Trustee, the Servicer, the Administrator, the Administrative Agent and the Disposition Manager, a monthly report (the “ Market Value Report ”) no later than the Determination Date prior to the related Payment Date, stating (i) the fair market value and the valuation percentage of the MSRs, the Portfolio Excess Spread and the Base Servicing Fee as of the Borrowing Base Determination Date., and (ii) the fair market value and the valuation percentage of the MSRs, which assumes that the 10-year U.S. Treasury rate (mid-mark) declines or increases by more than 0.375% from the 10-year U.S. Treasury rate (mid-mark) as of the most recent Borrowing Base Determination Date (as determined by the MSR Valuation Agent).

(h) Section 3.3 of the Existing Base Indenture is hereby amended by deleting subsection (j) in its entirety and replacing it with the following:

(j) Disposition Manager .  The Disposition Manager will have the duties specifically set forth in the Disposition Management Agreement, including a requirement to assist in the engagement of an appropriate third party broker (such broker, the “ MSR Sales Agent ”) and coordinate the sale of the MSRs in accordance with the rights and responsibilities of the Indenture Trustee as secured party under the Acknowledgment Agreement.  Prior to the occurrence and continuation of an Event of Default, PMC shall have the right to remove and replace the Disposition Manager without cause with prior written consent of the Administrative Agent and Fannie Mae.  The Disposition Manager shall have the right to resign under the circumstances described in the Disposition Management Agreement.  No resignation or removal of the Disposition Manager and no appointment of a successor Disposition Manager will become effective until the acceptance of appointment by a successor Disposition Manager.  Pursuant to the Disposition Management Agreement, if no successor Disposition Manager shall have been appointed and shall have accepted appointment within sixty (60) days after the giving of a notice of resignation, the resigning Disposition Manager may petition any court of competent jurisdiction for the appointment of a successor Disposition Manager, and the costs of the Disposition Manager in connection with such petition shall be reimbursable in accordance with the Disposition Management Agreement.  Notwithstanding anything in this Base Indenture to the contrary, in the event of any conflict between this Base Indenture (or any provision of this Base Indenture) and the Disposition Management Agreement, the terms of the Disposition Management Agreement shall prevail.

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(i) Section 4.4(a) of the Existing Base Indenture is hereby amended by deleting clause (iv) therefrom and replacing it with the following:

(iv) any Net Excess Cash Amount or Eligible Securities to or at the written direction of PMC as holder of the Owner Trust Certificate, it being understood that no such Net Excess Cash Amounts may be paid to PMC under this clause (iv) if, after the payment of such cash amounts, such payment would result in a Borrowing Base Deficiency; provided , that amounts due and owing to the Owner Trustee or the Indenture Trustee and not previously paid hereunder or under any other Transaction Document shall be paid prior to such payment; and

(j) Section 4.5(a)(1) of the Existing Base Indenture is hereby amended by deleting clause (x) therefrom and replacing it with the following:

(x) any Net Excess Cash Amount or Eligible Securities to or at the direction of PMC as holder of the Owner Trust Certificate, to the extent that following any such payment, there would not be a Borrowing Base Deficiency; provided that amounts due and owing to the Owner Trustee or the Indenture Trustee and not previously paid hereunder or under any other Transaction Document shall be paid prior to such payment.

(k) Section 4.12 of the Existing Base Indenture is hereby amended by deleting the final period of the third paragraph thereof and inserting the following:

; provided , upon waiver or cure of an Event of Default and continuation of a Revolving Period, any hourly fees incurred by the Disposition Manager during any Default Period shall be paid on the immediately following Payment Date pursuant to Section 4.5(a)(1)(ii) .

(l) Section 6.5 of the Existing Base Indenture is hereby amended by adding a new subsection (m) thereto as follows:

(m) Deemed Representations regarding Fannie Mae´s Rights .  Each transferee of a Term Note or of a beneficial interest therein, by accepting such Term Note or beneficial interest, shall be deemed to have made, acknowledged and represented to and with the Indenture Trustee and Fannie Mae, each of the following statements:

(i) the rights of any Noteholder will be subject and subordinate in all respects to all rights, powers, and prerogatives of Fannie Mae under the Fannie Mae Lender Contract, and no Noteholder enjoys privity of contract with Fannie Mae or is entitled to any benefit under the Acknowledgment Agreement except to the extent that the Indenture Trustee is entering into and shall perform under the Acknowledgment Agreement in its capacity as Indenture Trustee for the benefit of the Noteholders

(ii) Fannie Mae has the right to terminate the Servicer with or without cause and controls the process for the disposition of assets under the Acknowledgment Agreement in the event of a termination of the Servicer or other transfer of MSRs; and  

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(iii) pursuant to the Fannie Mae Lender Contract, Fannie Mae has the right to offset liabilities owed to it subject to the Acknowledgment Agreement against fees and compensation paid to the Servicer prior to any distribution of excess servicing to any Noteholder.

(m) Section 9.1 of the Existing Base Indenture is hereby amended by deleting the first full sentence thereof and replacing it with the following:

The Issuer hereby makes the following representations and warranties for the benefit of the Servicer, the Indenture Trustee, the Disposition Manager and the Noteholders.

(n) Section 12.1 of the Existing Base Indenture is hereby amended by adding a new subsection (d) at the end thereof as follows:

(d) Any amendment of this Base Indenture which affects the rights, duties, immunities, obligations or liabilities of the Disposition Manager hereunder shall require the written consent of the Disposition Manager.

(o) Section 13.1 of the Existing Base Indenture is hereby amended by deleting the second paragraph of subsection (a) in its entirety and replacing it with the following:

If the Issuer, at the direction of the Administrator, elects to redeem a Series or Class of Notes pursuant to this Section 13.1 , it will cause the Issuer to notify the Indenture Trustee and the Noteholders of such redemption at least five (5) days (or other times specified in the related Indenture Supplement) prior to the Redemption Payment Date.  Unless otherwise specified in the Indenture Supplement applicable to the Notes to be so redeemed, the redemption price of a Series or Class so redeemed will equal the Redemption Amount, the payment of which will be subject to the allocations, deposits and payments sections of the related Indenture Supplement, if any.  

(p) Section 13.1 of the Existing Base Indenture is hereby amended by deleting subsection (c) in its entirety and replacing it with the following:

The Notes of any Series or Class of Notes shall be subject to optional redemption under this Article XIII , in whole but not in part, by the Issuer, through (i) the use of the proceeds of issuance and sale of a new Series of Notes issued hereunder, or (ii) the use of the proceeds received of any amounts funded under any Variable Funding Notes on any Business Day after the date on which the related Revolving Period ends, and on any Business Day within five (5) days prior to the end of such Revolving Period or at other times specified in the related Indenture Supplement upon five (5) days’ prior notice to the Indenture Trustee and the Noteholders.  Following issuance of the Redemption Notice by the Issuer pursuant to Section 13.2 below, the Issuer shall be required to purchase the entire aggregate Note Balance of such Series or Class of Term Notes for the applicable Redemption Amount on the date set for such redemption (the “ Redemption Date ”).  

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(q) Article XIV of the Existing Base Indenture is hereby amended by inserting the following Section 14.13 at the end thereof:

Section 14.13.     Third-Party Beneficiaries.

The parties hereto hereby acknowledge and agree that the Disposition Manager shall be an express third party beneficiary of this Indenture.

(r) Exhibits B-1 and B-2 of the Existing Base Indenture are hereby amended by adding the following certification to the transferee certification:

The Transferee hereby further acknowledges that:

(i) the rights of any Transferee will be subject and subordinate in all respects to all rights, powers, and prerogatives of Fannie Mae under the Fannie Mae Lender Contract, and no Noteholder enjoys privity of contract with Fannie Mae or is entitled to any benefit under the Acknowledgment Agreement except to the extent that the Indenture Trustee is entering into and shall perform under the Acknowledgment Agreement in its capacity as Indenture Trustee for the benefit of the Noteholders;

(ii) Fannie Mae has the right to terminate the Servicer with or without cause and controls the process for the disposition of assets under the Acknowledgment Agreement in the event of a termination of the Servicer or other transfer of MSRs; and  

(iii) pursuant to the Fannie Mae Lender Contract, Fannie Mae has the right to offset liabilities owed to it subject to the Acknowledgment Agreement against fees and compensation paid to the Servicer prior to any distribution of excess servicing to any Noteholder.

(s) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “Acknowledgment Agreement” in its entirety and replacing it as follows:

“ Acknowledgment Agreement ” means collectively, (i) the Amended and Restated Acknowledgment Agreement, dated as of April 25, 2018, by and among Fannie Mae, PMC, PMH, PMT and the Indenture Trustee and (ii) the Subordination of Interest Agreement.

(t) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “Advance Reimbursement Amount” in its entirety and replacing it as follows:

“ Advance Reimbursement Amount ” means any amount which the Servicer collects on a Mortgage Loan, withdraws from a custodial account or receives from any successor servicer or Fannie Mae pursuant to the Fannie Mae Guide, as reimbursement for advances in its capacity as Servicer with respect to Fannie Mae MBS.

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(u) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “Ancillary Income” in its entirety and replacing it as follows:

“ Ancillary Income ” means all income derived from a Mortgage Loan (other than payments or other collections in respect of principal, interest, escrow payments and prepayment penalties attributable to such Mortgage Loan) and to which the Servicer or any Subservicer, as the servicer or subservicer of the Mortgage Loan, is entitled in accordance with the Fannie Mae Lender Contract, including, (i) all late charges, fees received with respect to checks or bank drafts returned by the related bank for insufficient funds, assumption fees, optional insurance administrative fees, all interest, income, or credit on funds deposited in the escrow accounts and custodial accounts or other receipts on or with respect to such Mortgage Loan (subject to applicable law and the Fannie Mae Lender Contract), (ii) reconveyance fees, subordination fees, speedpay fees, mortgage pay on the web fees, automatic clearing house fees, demand statement fees, modification fees, if any, and other similar types of fees arising from or in connection with any Mortgage Loan to the extent not otherwise payable by the mortgagor under applicable law or pursuant to the terms of the related Mortgage Note, and (iii) if and to the extent that any FHA Loans, USDA Loans or VA Loans are Subject Mortgages, any incentive fees payable by FHA under the applicable FHA Mortgage Insurance Contract, by USDA under the USDA Loan Guarantee Document, or by VA under the applicable VA Loan Guaranty Agreement, as applicable, to the Servicer or any Subservicer, as servicer or subservicer of the Mortgage Loans, including incentive amounts payable in connection with Mortgage Loan modifications and other loss mitigation activities.

(v) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Class Invested Amount ” in its entirety and replacing it with the following:

“ Class Invested Amount ” means, as of any date of determination:

(i) for any Class of a Series of Variable Funding Notes, an amount equal to: (i) the sum of (A) the outstanding Note Balance of such Class (as reduced by (1) the Scheduled Principal Payment Amount actually paid on such Class on such Payment Date, if applicable, and (2) the Early Amortization Event Payment Amount actually paid on such Class on such Payment Date, if applicable), plus (B) the aggregate outstanding Note Balances of all Classes of Variable Funding Notes within the same Series of Variable Funding Notes that are senior to or pari passu with such Class on such date (as reduced by (1) the Scheduled Principal Payment Amounts actually paid on such Classes on such Payment Date, if applicable, and (2) the Early Amortization Event Payment Amounts actually paid on such Classes on such Payment Date, if applicable) and not otherwise captured in clause (A) , divided by (ii) the Advance Rate in respect of such Class of Variable Funding Notes; and  

(ii) for any Class of a Series of Term Notes, an amount equal to: (i) the sum of (A) the outstanding the Note Balance of such Class (as reduced by (1) the Scheduled Principal Payment Amount actually paid on such Class on such Payment Date, if applicable, and (2) the Early Amortization Event Payment Amount actually paid on such Class on such Payment Date, if applicable), plus (B) the aggregate outstanding

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Note Balances of all Classes of Term Notes within the same Series of Term Notes that are senior to or pari passu with such Class on such date (as reduced by (1) the Scheduled Principal Payment Amounts actually paid on such Classes on such Payment Date, if applicable, and (2) the Early Amortization Event Payment Amounts actually paid on such Classes on such Payment Date, if applicable) and not otherwise captured in clause (A) , divided by (ii) the highest Advance Rate in respect of such Class of Term Notes.  

(w) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Cumulative Default Supplemental Fee Shortfall Amount ” in its entirety and replacing it as follows:

“ Cumulative Default Supplemental Fee Shortfall Amount ” means, for each Payment Date and each Class of Notes, any portion of the Default Supplemental Fee (including the Cumulative Default Supplemental Fee Shortfall Amount for that Class for a previous Payment Date as set forth in the definition of “Default Supplemental Fee”) that has not been paid, if any, plus accrued and unpaid interest at the applicable Note Interest Rate plus the Default Supplemental Fee Rate on such shortfall from the Payment Date on which the shortfall first occurred through but excluding the current Payment Date.

(x) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Cumulative Interest Shortfall Amount ” in its entirety and replacing it as follows:

“ Cumulative Interest Shortfall Amount ” means, for each Payment Date and each Class of Notes, equal to any portion of the Interest Payment Amount (calculated pursuant to the provisions of the Base Indenture) for that Class for all previous Payment Dates that has not been paid, if any, plus accrued and unpaid interest at the applicable Note Interest Rate plus the Cumulative Interest Shortfall Amount Rate on each such shortfall from the Payment Date on which such shortfall first occurred to but excluding the current Payment Date.

(y) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Cumulative Step-Up Fee Shortfall Amount ” in its entirety and replacing it as follows:

“ Cumulative Step-Up Fee Shortfall Amount ” means, for each Payment Date and each Class of Notes, any portion of the Step-Up Fee (including the Cumulative Step-Up Fee Shortfall Amount for that Class for a previous Payment Date as set forth in the definition of “Step-Up Fee”) that has not been paid, plus accrued and unpaid interest at the applicable Note Interest Rate and plus the Step-Up Fee Rate on such shortfall from the Payment Date on which the shortfall first occurred through the current Payment Date.

(z) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Disposition Management Agreement ” in its entirety and replacing it as follows:

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“ Disposition Management Agreement ” means the Disposition Management Agreement, dated as of April 25, 2018, by and among the Disposition Manager, the Indenture Trustee, PMC and the Administrative Agent .  

(aa) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Disposition Manager ” in its entirety and replacing it as follows:

“ Disposition Manager ” means Pentalpha Surveillance LLC.

(bb) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “ Fannie Mae Eligibility Requirements ” in its entirety and replacing it as follows:

“ Fannie Mae Eligibility Requirements ” has the meaning set forth in Section 3.2(b)(xii) of the Base Indenture.

(cc) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “Market Value” in its entirety and replacing it as follows:

“ Market Value ” means, as of any date of determination, (a) with respect to the Participation Certificate, as of any date of determination, the product of (1) the Market Value Percentage as of the most recent Market Value Report and (2) the aggregate unpaid principal balance of the Mortgage Loans related to the MSRs evidenced by the Participation Certificate as of the last day for which such information is available; (b) with respect to any Eligible Security, the fair market value thereof as of the close of business on the immediately preceding Business Day, as determined by an independent third party appointed by the Administrator and subject to procedures mutually agreed to between the Administrator and the Administrative Agent; and (c) with respect to any Pledged Margin Security, the positive mark to market gain, if any, as determined by using the bid side pricing of either Tradeweb Markets, LLC, Thomson Reuters or such other pricing service mutually agreeable to the Administrator and the Administrative Agent or the exchange upon which such contract is traded, as applicable.

(dd) Appendix A of the Existing Base Indenture is hereby amended by deleting the definition of “Stop-Loss Cap Period” in its entirety and replacing it as follows:

“ Stop-Loss Cap Period ” means the period beginning on the effective date of the Acknowledgment Agreement and terminating on the fifth (5th) anniversary of the effective date of the Acknowledgment Agreement, subject to any extension of such period pursuant to the terms of the Acknowledgment Agreement as agreed by Fannie Mae in its sole and absolute discretion.

(ee) Appendix A of the Existing Base Indenture is hereby amended by adding a new definition thereto in correct alphabetical order as follows;

“ Administrator’s Calculation Report ” has the meaning set forth in Section 3.1(a) of the Base Indenture.  

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SECTION 2.   Consent, Authorization and Direction .  Each of the Issuer, the Noteholder, the Indenture Trustee, the Administrator, the Servicer and the Administrative Agent hereby consents to this Amendment.  The Indenture Trustee is hereby authorized and directed to execute (i) that certain Amended and Restated Acknowledgement Agreement, dated as of the date hereof, among Fannie Mae, the Indenture Trustee, PMC and PennyMac Holdings, LLC, (ii) that certain Disposition Management Agreement, dated as of the date hereof, among Pentalpha Surveillance LLC, as disposition manager, the Indenture Trustee, PMC and the Administrative Agent and (iii) any other documents related to the issuance of the Series 2018-FT1 Term Notes.

SECTION 3.   Conditions to Effectiveness of this Amendment .  This Amendment shall become effective upon the latest to occur of the following:

(a) the execution and delivery of this Amendment by all parties hereto;

(b) prior notice to each Note Rating Agency that is presently rating any Outstanding Notes and each Note Rating Agency currently rating the Outstanding Notes confirms in writing to the Indenture Trustee that this Amendment will not cause a Ratings Effect on any Outstanding Notes;

(c) the delivery of an Authorization Opinion;  

(d) the delivery of an Issuer Tax Opinion;

(e) the Administrative Agents shall have provided their prior written consent to this Amendment;

(f) the Issuer shall have furnished to the Indenture Trustee (1) an Officer’s Certificate stating that all conditions precedent, if any, provided for in the Base Indenture relating to the proposed action have been complied with and (2) an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with; and

(g) the delivery of an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by the Trust Agreement and that all conditions precedent have been met;

SECTION 4.   No Default; Representations and Warranties .  PMC and the Issuer hereby represents and warrants to the Indenture Trustee and the Administrative Agent that as of the date hereof it is in compliance with all the terms and provisions set forth in the Existing Base Indenture on its part to be observed or performed and remains bound by the terms thereof, and that no Event of Default has occurred or is continuing on the date hereof, and hereby confirms and reaffirms the representations and warranties contained in Section 9.1 of the Existing Base Indenture.

SECTION 5. Single Agreement .  Except as expressly amended and modified by this Amendment, all of the terms and conditions of the Existing Base Indenture remain in full force and effect and are hereby reaffirmed.

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SECTION 6. Successors and Assigns .  This Amendment shall be binding upon the parties hereto and their respective successors and assigns.

SECTION 7.   Severability .  Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.

SECTION 8.   GOVERNING LAW .  THIS AMENDMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO OR IN CONNECTION WITH THIS BASE INDENTURE, THE RELATIONSHIP OF THE PARTIES HERETO, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES HERETO WILL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO THE CONFLICT OF LAW PRINCIPLES THEREOF OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

SECTION 9.   Counterparts .  This Amendment 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.  Delivery of an executed counterpart of a signature page by facsimile or other electronic means shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 10. Owner Trustee Limitation of Liability . It is expressly understood and agreed by the parties hereto that (a) this Amendment is executed and delivered by Wilmington Savings Fund Society, FSB (formerly known as Christiana Trust) (“ WSFS ”), not individually or personally but solely as trustee of the Issuer, in the exercise of the powers and authority conferred and vested in it, (b) each of the representations, warranties, undertakings and agreements herein made on the part of the Issuer is made and intended not as personal representations, warranties, undertakings and agreements by WSFS but is made and intended for the purpose of binding only the Issuer, (c) nothing herein contained shall be construed as creating any liability on WSFS, individually or personally, to perform any covenant either expressed or implied contained herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under the parties hereto, (d) WSFS has made no investigation as to the accuracy or completeness of any representations or warranties made by the Issuer in this Amendment and (e) under no circumstances shall WSFS be personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Amendment or any other related documents.

[Signature Pages Follow]

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IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed as of the date first above written .

[PMT ISSUER TRUST - FMSR – Amendment No. 1 to Base Indenture]

[PMT ISSUER TRUST - FMSR – Amendment No. 1 to Base Indenture]

[PMT ISSUER TRUST - FMSR – Amendment No. 1 to Base Indenture]

[PMT ISSUER TRUST - FMSR – Amendment No. 1 to Base Indenture]

[PMT ISSUER TRUST - FMSR – Amendment No. 1 to Base Indenture]

Exhibit 10.2

EXECUTION COPY

PMT ISSUER TRUST - FMSR,

as Issuer

and

CITIBANK, N.A.,

as Indenture Trustee, Calculation Agent, Paying Agent and Securities Intermediary

and

PENNYMAC CORP.,

as Administrator and Servicer

and

CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC,

as Administrative Agent

__________

SERIES 2018-FT1 INDENTURE SUPPLEMENT

Dated as of April 25, 2018

To

BASE INDENTURE

Dated as of December 20, 2017

MSR COLLATERALIZED NOTES,
SERIES 2018-FT1

Table of Contents

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This SERIES 2018- FT1 INDENTURE SUPPLEMENT (this “ Indenture Supplement ”), dated as of April 25, 2018, is made by and among PMT ISSUER TRUST – FMSR, a statutory trust organized under the laws of the State of Delaware, as issuer (the “ Issuer ”), CITIBANK, N.A., a national banking association, as indenture trustee (the “ Indenture Trustee ”), as calculation agent (the “ Calculation Agent ”), as paying agent (the “ Paying Agent ”) and as securities intermediary (the “ Securities Intermediary ”), PENNYMAC CORP., a corporation organized under the laws of the State of Delaware (“ PMC ”), as administrator (the “ Administrator ”) and as servicer (the “ Servicer ”), and CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC (“ CSFB ”), a Delaware limited liability company, as Administrative Agent (as defined herein).  This Indenture Supplement relates to and is executed pursuant to that certain Base Indenture, dated as of December 20, 2017, including the schedules and exhibits thereto (as supplemented hereby, as amended by Amendment No. 1 thereto, dated as of the date hereof, and as further amended, restated, supplemented or otherwise modified from time to time, the “ Base Indenture ”), among the Issuer, PMC, the Indenture Trustee, the Calculation Agent, the Paying Agent, the Securities Intermediary, and CSFB, as Administrative Agent, and the “Administrative Agents” from time to time parties thereto, all the provisions of which are incorporated herein as modified hereby and shall be a part of this Indenture Supplement as if set forth herein in full (the Base Indenture as so supplemented by this Indenture Supplement, collectively referred to as the “ Indenture ”).

Capitalized terms used and not otherwise defined herein shall have the respective meanings given them in the Base Indenture, and the rules of interpretation set forth in Section 1.2 of the Base Indenture shall apply equally herein.

PRELIMINARY STATEMENT

The Issuer has duly authorized the issuance of a Series of Term Notes, the Series 2018-FT1 Term Notes (as defined below).  The parties are entering into this Indenture Supplement to document the terms of the issuance of the Series 2018-FT1 Term Notes pursuant to the Base Indenture, which provides for the issuance of Notes in multiple series from time to time.

Section 1. Creation of the Series 2018-FT1 Term Notes.

There are hereby created, effective as of the Issuance Date, the Series 2018-FT1 Term Notes, to be issued pursuant to the Base Indenture and this Indenture Supplement, to be known as “PMT ISSUER TRUST - FMSR MSR Collateralized Notes, Series 2018-FT1” (the “ Series 2018-FT1 Term Notes ”).  The Series 2018-FT1 Term Notes will be rated and are not subordinate to any other Series of Notes.  The Series 2018-FT1 Term Notes are issued in one (1) Class of Term Notes with the Initial Note Balance, Stated Maturity Date, Note Interest Rate and other terms as specified in this Indenture Supplement.  The Series 2018-FT1 Term Notes shall be secured by the Trust Estate Granted to the Indenture Trustee pursuant to the Base Indenture.  The Indenture Trustee shall hold the Trust Estate as collateral security for the benefit of the Noteholders of the Series 2018-FT1 Term Notes and all other Series of Notes issued under the Base Indenture as described therein.  In the event that any term or provision contained herein with respect to the Series 2018-FT1 Term Notes shall conflict with or be inconsistent with any term or provision contained in the Base Indenture, the terms and provisions of this Indenture Supplement shall govern to the extent of such conflict.

Section 2. Defined Terms.

With respect to the Series 2018-FT1 Term Notes and in addition to or in replacement of the definitions set forth in Section 1.1 of the Base Indenture, the following definitions shall be assigned to the defined terms set forth below:

“ Administrative Agent ” means, for so long as the Series 2018-FT1 Term Notes are Outstanding: (i) with respect to the provisions of this Indenture Supplement, CSFB, or an Affiliate or successor thereto; and (ii) with respect to the provisions of the Base Indenture, together CSFB and such other parties as set forth in any other Indenture Supplement, or a respective Affiliate or any respective successor thereto.  For the avoidance of doubt, reference to “it” or “its” with respect to the Administrative Agent in this Indenture Supplement or in the Base Indenture shall mean “them” and “their,” and reference to the singular herein and therein in relation to the Administrative Agent will be construed as if plural.

“ Advance Rate ” means, with respect to the Series 2018-FT1 Term Notes, on any date of determination, 80%; provided , that, upon the occurrence of an Advance Rate Trigger 1 Event, the Advance Rate will be decreased by 2.00% until the Advance Rate Trigger 1 Event has been cured in all respects subject to the satisfaction of the Administrative Agent for two (2) consecutive months, at which point the Advance Rate, as applicable, will revert to 80%; provided , further , that, upon the occurrence of an Advance Rate Trigger 2 Event, the Advance Rate will decrease by either (x) an additional 3.00% if Advance Rate Trigger 1 is in effect or (y) 5% if Advance Rate Trigger 1 is not in effect, such that the cumulative decrease of the Advance Rate upon the occurrence of an Advance Rate Trigger 2 Event will be 5.00% until the Advance Rate Trigger 2 Event has been cured in all respects subject to the satisfaction of the Administrative Agent for two (2) consecutive months, at which point the Advance Rate, as applicable, will be (x) if an Advance Rate Trigger 1 Event is then in effect, 78%, and (y) if no Advance Rate Trigger 1 Event is then in effect, 80%.  

“ Advisers Act ” has the meaning assigned to such term in Section 3(c) hereof.

“ Applicable Ratings ” means, with respect to the Series 2018-FT1 Term Notes, “BBB-(sf)”.

“ Base Indenture ” has the meaning assigned to such term in the Preamble.

“ Benefit Plan Investor ” has the meaning assigned to such term in Section 3(c) hereof.

“ Corporate Trust Office ” means the corporate trust offices of the Indenture Trustee at which at any particular time its corporate trust business with respect to the Issuer shall be administered, which offices at the Issuance Date are located at Citibank, N.A., Corporate and Investment Banking, 388 Greenwich Street, 14th Floor, New York, NY 10013, Attention: PMT ISSUER TRUST – FMSR MSR Collateralized Notes, including for Note transfer, exchange or surrender purposes.

“ Cumulative Interest Shortfall Amount Rate ” means, with respect to the Series 2018-FT1 Term Notes, 2.00% per annum .

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“ Default Supplemental Fee ” means, for the Series 2018-FT1 Term Notes and each Payment Date during the Full Amortization Period and on the date of final payment of such Notes (if the Full Amortization Period is continuing on such final payment date), (i) the related Cumulative Default Supplemental Fee Shortfall Amount plus (ii) the product of (a) the Default Supplemental Fee Rate multiplied by (b) the average daily Note Balance since the prior Payment Date of the Series 2018-FT1 Term Notes multiplied by (c) a fraction, the numerator of which is the number of days elapsed from and including the prior Payment Date (or, if later, the commencement of the Full Amortization Period) to but excluding such Payment Date and the denominator of which equals 360.

“ Default Supplemental Fee Rate ” means, with respect to the Series 2018-FT1 Term Notes, 2.00% per annum .

“ Early Amortization Event Payment Amount ” means, with respect to the Series 2018-FT1 Term Notes, one-thirty-sixth (1/36) of the Note Balance of the Series 2018-FT1 Term Notes as of the date on which an Early Amortization Event occurs.  

“ Indenture ” has the meaning assigned to such term in the Preamble.

“ Indenture Supplement ” has the meaning assigned to such term in the Preamble.

“ Initial Note Balance ” means, for the Series 2018-FT1 Term Notes, $450,000,000.

“ Initial Purchasers ” means together, Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Barclays Capital Inc.

“ Interest Accrual Period ” means, for the Series 2018-FT1 Term Notes, (i) with respect to the first Payment Date, the period that will commence on the Issuance Date and will end on the day immediately preceding the Payment Date in May 2018, and (ii) with respect to any subsequent Payment Dates, the period that will commence on the immediately preceding Payment Date and end on the day immediately preceding the current Payment Date.  The Interest Payment Amount for the Series 2018-FT1 Term Notes for each Payment Date will be calculated based on the Interest Day Count Convention.  The first Payment Date with respect to the Series 2018-FT1 Term Notes will be May 25, 2018.

“ Interest Day Count Convention ” means, with respect to the Series 2018-FT1 Term Notes, the actual number of days in the related Interest Accrual Period, divided by 360.

“ Issuance Date ” means April 25, 2018.

“ LIBOR ” means the London Interbank Offered Rate.

“ LIBOR Determination Date ” means, for each Payment Date and the related Interest Accrual Period, the second (2nd) London Banking Day prior to the commencement of such Interest Accrual Period.

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“ LIBOR Index Rate ” means for a one-month period, LIBOR per annum (rounded upward, if necessary, to the next higher one hundred-thousandth of a percentage point) for deposits in U.S. Dollars for a one-month period, which appears on the LIBOR01 Page as of 11:00 a.m. (London, England time) on the LIBOR Determination Date.

“ LIBOR Rate ” means, with respect to any Interest Accrual Period with respect to which interest is to be calculated by reference to the “LIBOR Rate,” (a) the LIBOR Index Rate for a one-month period, if such rate is available, (b) in the event that LIBOR and LIBOR Index Rate are phased out, and a new benchmark intended as a replacement for LIBOR and 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 Administrator, with the Administrative Agent’s written consent, shall direct the Indenture Trustee to 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 Administrative Agent 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 Administrative Agent 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 portion of the Note Balance on which the “LIBOR Rate” is being calculated.  

“ LIBOR01 Page ” means the display designated as “LIBOR01 Page” on the Reuters Service (or such other page as may replace the LIBOR01 Page on that service or such other service as may be nominated by the ICE Benchmark Administration as an information vendor for the purpose of displaying ICE Benchmark Administration interest settlement rates for U.S. Dollar deposits).

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

“ Margin ” means, for the Series 2018-FT1 Term Notes, 2.35% per annum .

“ Note Interest Rate ” means, for the Series 2018-FT1 Term Notes, with respect to any Interest Accrual Period, the sum of (a) LIBOR Rate (as determined by the Indenture Trustee as described in Section 7 hereof) plus (b) the Margin.

“ Note Maximum Principal Balance ” means, with respect to the Series 2018-FT1 Term Notes, the Initial Note Balance or, a lesser amount if the Series 2018-FT1 Term Notes are redeemed in part.

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“ Note Purchase Agreement ” means that certain Series 2018-FT1 Note Purchase Agreement, dated as of April 23, 2018, by and among the Issuer, CSFB, as Administrative Agent on behalf of the Initial Purchasers, PMC, as Administrator and Servicer, and the Initial Purchasers, that relates to the purchase of the Series 2018-FT1 Term Notes, as amended, restated, supplemented or otherwise modified from time to time.

“ Note Rating Agency ” means Kroll Bond Rating Agency, Inc.

“ Optional Extension Date ” means April 25, 2023.

“ Plan Fiduciary ” has the meaning assigned to such term in Section 3(c) hereof.

“ PMC ” has the meaning assigned to such term in the Preamble.

“ Regulation RR ” has the meaning assigned to such term in Section 15 of this Indenture Supplement.

“ Scheduled Principal Payment Amount ” means, with respect to any Payment Date following a Scheduled Principal Payment Event, an amount equal to the sum of the Series Principal Payment Amounts due and payable on each Series of Terms Notes then outstanding.

“ Scheduled Principal Payment Events ” means, for any Payment Date with respect to the Series 2018-FT1 Term Notes, a Series Principal Payment Amount will be due on a one-time basis on any Payment Date following the occurrence of any of the following events (each, a “ Scheduled Principal Payment Event ”):

(i) the unpaid principal balance of the Portfolio is less than $30 billion and a Borrowing Base Deficiency exists as of the close of business on the last day of the related Collection Period, prior to the paydown of the VFN Principal Balance of any Outstanding Class of VFNs from the preceding Payment Date;

(ii) the unpaid principal balance of the Portfolio is less than $28 billion and a Borrowing Base Deficiency exists as of the close of business on the last day of the related Collection Period, prior to the paydown of the VFN Principal Balance of any Outstanding Class of VFNs from the preceding Payment Date;

(iii) the unpaid principal balance of the Portfolio is less than $26 billion and a Borrowing Base Deficiency exists as of the close of business on the last day of the related Collection Period, prior to the paydown of the VFN Principal Balance of any Outstanding Class of VFNs from the preceding Payment Date;

(iv) the unpaid principal balance of the Portfolio is less than $24 billion and a Borrowing Base Deficiency exists as of the close of business on the last day of the related Collection Period, prior to the paydown of the VFN Principal Balance of any Outstanding Class of VFNs from the preceding Payment Date; or

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(v) the unpaid principal balance of the Portfolio is less than $22 billion and a Borrowing Base Deficiency exists as of the close of business on the last day of the related Collection Period, prior to the paydown of the VFN Principal Balance of any Outstanding Class of VFNs from the preceding Payment Date.

“ Series 2018-FT1 Term Notes ” has the meaning assigned to such term in Section 1 of this Indenture Supplement.

“ Series Principal Payment Amount ” means, with respect to the Series 2018-FT1 Term Notes, upon the occurrence of a Scheduled Principal Payment Event, an amount equal to the product of (i) the Series Allocation Percentage of the Series 2018-FT1 Term Notes and (ii) the product of (a) $2,000,000,000, (b) the Market Value Percentage (as calculated using clause (b)(ii) of the definition thereof) and (c) the Advance Rate of the Series 2018-FT1 Term Notes.      

“ Series Required Noteholders ” means, for so long as the Series 2018-FT1 Term Notes are Outstanding, Noteholders of the Series 2018-FT1 Term Notes constituting the Majority Noteholders of such Series.

“ Specified Call Premium Amount ” means, as of any date of determination in respect of the Series 2018-FT1 Term Notes, the greater of (i) $0 and (ii) (a) the quotient of: (1) the product of: (x) the Note Interest Rate multiplied by (y) the outstanding Note Balance divided by (2) 360 multiplied by (b) the positive excess, if any, of 360 over the number of days from and including the date the Series 2018-FT1 Term Notes were issued through and including the date on which the Series 2018-FT1 Term Notes are redeemed.

“ Stated Maturity Date ” means, for Series 2018-FT1 Term Notes, April 25, 2023, or if extended pursuant to Section 6 hereof, April 25, 2025.

“ Step-Up Fee ” means, with respect to the Series 2018-FT1 Term Notes, for each Payment Date during the Step-Up Fee Period and on the date of final payment of the Series 2018-FT1 Term Notes (if the Step-Up Fee Period is continuing on such final payment date), (1) the related Cumulative Step-Up Fee Shortfall Amount plus (2) the product of (i) the Step-Up Fee Rate multiplied by (ii) the average daily Note Balance since the prior Payment Date of the Series 2018-FT1 Term Notes multiplied by (iii) a fraction, (A) the numerator of which is the number of days elapsed from and including the prior Payment Date (or, if later, the commencement of the Step-Up Fee Period) to, but excluding, such Payment Date and (B) the denominator of which equals 360.

“ Step-Up Fee Period ” means the period that begins on the Payment Date immediately following the Optional Extension Date and ends on the date on which the Series 2018-FT1 Term Notes are no longer outstanding.

“ Step-Up Fee Rate ” means, with respect to the Series 2018-FT1 Term Notes, 1.00% per annum .

“ Transaction Parties ” has the meaning assigned to such term in Section 3(c) hereof.

“ WSFS ” has the meaning assigned to such term in Section 14 hereof.

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Section 3. Form of the Series 2018- FT1 Term Notes; Transfer Restrictions; Certain Additional ERISA Considerations.

(a)    Subject to the terms and provisions of Section 5.4 of the Base Indenture, the Series 2018-FT1 Term Notes shall only be issued as a Book-Entry Note, and the form of Global Rule 144A Note that may be used to evidence the Series 2018-FT1 Term Notes in the circumstances described in Section 5.2(c) of the Base Indenture is attached to the Base Indenture as Exhibit A-1.  The Series 2018-FT1 Term Notes shall not be issued as Regulation S Notes nor shall any Series 2018-FT1 Term Notes be sold in offshore transactions in reliance on Regulation S.

The Series 2018-FT1 Term Notes will be issued in minimum denominations of $100,000 and integral multiples of $1,000 in excess thereof.

(b)    The Series 2018-FT1 Term Notes will not be registered under the 1933 Act, or the securities laws of any other jurisdiction.  The sale, pledge or other transfer of any Series 2018-FT1 Term Note or any interest therein will be subject to the restrictions described below.  The Series 2018-FT1 Term Notes will bear a legend referring to the transfer restrictions thereof.  None of the Issuer or the Initial Purchasers will register the Series 2018-FT1 Term Notes under the 1933 Act, register or qualify the Series 2018-FT1 Term Notes under the securities laws of any state or other jurisdiction or provide registration rights to any purchaser.

In addition to any provisions set forth in Section 6.5 of the Base Indenture, any Noteholder of the Series 2018-FT1 Term Notes may only resell, pledge or transfer its beneficial interest in a Series 2018-FT1 Term Note to a person that the transferor reasonably believes is, and who has certified (or, in the case of Book-Entry Notes, is deemed to have certified) that it is a Qualified Institutional Buyer that purchases for its own account or for the account of a Qualified Institutional Buyer and to whom notice is given that the resale, pledge or transfer is made in reliance on Rule 144A.  The Series 2018-FT1 Term Notes may not be resold, pledged or transferred pursuant to Regulation S.

(c)      In addition to any provisions set forth in Section 6.5 of the Base Indenture, any purchaser, transferee or holder of the Series 2018-FT1 Term Notes or any interest therein that is a “benefit plan investor” as defined in 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA (a “ Benefit Plan Investor ”) or a fiduciary purchasing the Series 2018-FT1 Term Notes on behalf of a Benefit Plan Investor (a “ Plan Fiduciary ”), will be required to represent (or in the case of a Book-Entry Note will be deemed represent by the acquisition of such Note) that:

(1)    none of the Issuer, PMC, Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. or Barclays Capital Inc., or any of their respective affiliates (the “ Transaction Parties ”), has provided or will provide advice with respect to the acquisition of the Series 2018-FT1 Term Notes by the Benefit Plan Investor, other than to the Plan Fiduciary which is “independent” (within the meaning of Department of Labor Regulations promulgated on April 8, 2016 (81 Fed. Reg. 20,997) (the “ Fiduciary Rule ”)) of the Transaction Parties;

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(2)     the Plan Fiduciary either:

(a) is a bank as defined in Section 202 of the Investment Advisers Act of 1940 (the “ Advisers Act ”), or similar institution that is regulated and supervised and subject to periodic examination by a State or Federal agency; or

(b) is an insurance carrier which is qualified under the laws of more than one state to perform the services of managing, acquiring or disposing of assets of a Benefit Plan Investor; or

(c) is an investment adviser registered under the Advisers Act, or, if not registered as an investment adviser under the Advisers Act by reason of paragraph (1) of Section 203A of the Advisers Act, is registered as an investment adviser under the laws of the state in which it maintains its principal office and place of business; or

(d) is a broker-dealer registered under the 1934 Act; or

(e) has, and at all times that the Benefit Plan Investor is invested in the Series 2018-FT1 Term Notes will have, total assets of at least U.S. $50,000,000 under its management or control (provided that this clause (e) shall not be satisfied if the Plan Fiduciary is either (i) the owner or a relative of the owner of an investing individual retirement account or (ii) a participant or beneficiary or a relative of a participant or beneficiary of the Benefit Plan Investor investing in or holding the Series 2018-FT1 Term Notes in such capacity);

(3)    the Plan Fiduciary is capable of evaluating investment risks independently, both in general and with respect to particular transactions and investment strategies, including the acquisition by the Benefit Plan Investor of the Series 2018-FT1 Term Notes;

(4)    the Plan F iduciary is a “fiduciary” within the meaning of Section 3(21) of ERISA and Section 4975 of the Code with respect to the Benefit Plan Investor and is responsible for exercising independent judgment in evaluating the Benefit Plan Investor’s acquisition of the Series 2018-FT1 Term Notes;

(5)    none of the Transaction Parties has exercised any authority to cause the Benefit Plan Investor to invest in the Series 2018-FT1 Term Notes or to negotiate the terms of the Benefit Plan Investor’s investment in the Series 2018-FT1 Term Notes; and

(6)      the Plan Fiduciary acknowledges and agrees that it has been informed (a) by the Transaction Parties that none of the Transaction Parties is undertaking to provide impartial investment advice or to give advice in a fiduciary capacity in connection with the Benefit Plan Investor’s acquisition of the Series 2018-FT1 Term Notes ; and (b) by each Transaction Party named above, on behalf of itself and its Affiliates, of the existence and nature of such named party’s and its Affiliates’ financial interests in the Benefit Plan Investor’s acquisition of the Series 2018-FT1 Term Notes.

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These representations are intended to comply with 29 C.F.R. Sections 2510.3-21(a) and (c)(1) of the Fiduciary Rule.  If these sections of the Fiduciary Rule are revoked, repealed or no longer effective, these representations shall be deemed to be no longer in effect.

Section 4. Payments and Allocation of Funds on Payment Dates; No Series Reserve Account.

(a) Except as otherwise expressly set forth herein, the Paying Agent shall make payments on the Series 2018-FT1 Term Notes on each Payment Date in accordance with Section 4.5 of the Base Indenture.  

(b) There will be no Series Reserve Account for the Series 2018-FT1 Term Notes.

(c) The Administrative Agent and the Issuer further confirm that the Series 2018-FT1 Term Notes issued on the Issuance Date pursuant to this Indenture Supplement shall be issued in the name of “Cede & Co.”, as nominee of DTC, pursuant to a letter agreement between the Issuer and DTC, to be dated as of the Issuance Date.  The Issuer and the Administrative Agent hereby direct the Indenture Trustee to issue the Series 2018-FT1 Term Notes in the name of “Cede & Co”.

Section 5. Optional Redemption and Refinancing.

(a) The Issuer may, at any time, subject to Section 13.1 of the Base Indenture, upon at least five (5) Business Days’ prior written notice to the Administrative Agent, the Indenture Trustee and the Noteholders of the Series 2018-FT1 Term Notes, redeem in whole or in part (so long as, in the case of any partial redemption, (i) such redemption is funded using the proceeds of the issuance and sale of one or more new Classes of Notes or from any other cash or funds of PMC and not Collections on the MSRs, and (ii) the Series 2018-FT1 Term Notes are redeemed on a pro rata basis based on their related Note Balances), and/or terminate and cause retirement of the Series 2018-FT1 Term Notes.  In anticipation of a redemption of the Series 2018-FT1 Term Notes at the end of their Revolving Period, the Issuer may issue a new Series or one or more Classes of Notes within the ninety (90) day period prior to the end of such Revolving Period and reserve the cash proceeds of the issuance for the sole purpose of paying the principal balance and all accrued and unpaid interest on the Series 2018-FT1 Term Notes, on the last day of their Revolving Period.  Any amendment to this Indenture Supplement executed to effect an optional redemption may be entered into without consent of the Noteholders of the Series 2018-FT1 Term Notes or of any other Notes issued under the Base Indenture (but with satisfaction of other requirements for amendments entered into without Noteholder consent). Any Notes issued in replacement for the Series 2018-FT1 Term Notes will have the same rights and privileges as the Class of Series 2018-FT1 Term Notes that was refinanced with the related proceeds thereof; provided , such replacement Notes may have different Stated Maturity Dates and different Note Interest Rates.

(b) If the Issuer redeems the Series 2018-FT1 Term Notes prior to the Payment Date occurring within twelve (12) months following the Issuance Date, the Issuer shall pay to the Noteholders of the Series 2018-FT1 Term Notes as part of the Redemption Amount an amount equal to the Specified Call Premium Amount.  

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Section 6. Optional Extension of Stated Maturity Date.

The Administrator, on behalf of the Issuer, may by written notice to the Administrative Agent and the Indenture Trustee, request a single extension of the Stated Maturity Date for the Series 2018-FT1 Term Notes at least fifteen (15) days prior to the Optional Extension Date (the “ Optional Extension ”); provided that the Acknowledgment Agreement is amended to extend the Stop-Loss Cap Period through April 30, 2025.  To the extent the Administrator has exercised the Optional Extension and the Stop-Loss Cap Period of the Acknowledgment Agreement has been extended through April 30, 2025, the Stated Maturity Date will be extended on the Optional Extension Date such that, after giving effect to such extension, the Stated Maturity Date will be two (2) years after the Stated Maturity Date in effect immediately prior to exercise of the Optional Extension.  The Stated Maturity Date of the Series 2018-FT1 Term Notes cannot be extended past the date which is two (2) years following the initial Stated Maturity Date in effect immediately prior to exercise of the Optional Extension and the last day of the Stop-Loss Cap Period.  Upon exercise of the Optional Extension, during the Step-Up Fee Period, the Step-Up Fee will apply to the Series 2018-FT1 Term Notes.

Section 7. Determination of Note Interest Rate and LIBOR.

(a) At least one (1) Business Day prior to each Determination Date, the Indenture Trustee shall calculate the Note Interest Rate for the related Interest Accrual Period and the Interest Payment Amount for the Series 2018-FT1 Term Notes for the upcoming Payment Date, and include a report of such amount in the related Payment Date Report.

(b) On each LIBOR Determination Date, the Indenture Trustee will determine the LIBOR Rate for the succeeding Interest Accrual Period for the related Series 2018-FT1 Term Notes on the basis of the procedures specified in the definition of “LIBOR Rate.”

(c) The establishment of the LIBOR Rate by the Indenture Trustee and the Indenture Trustee’s subsequent calculation of the Note Interest Rate and the Interest Payment Amount on the Series 2018-FT1 Term Notes for the relevant Interest Accrual Period, in the absence of manifest error, will be final and binding.

Section 8. Conditions Precedent Satisfied.

The Issuer hereby represents and warrants to the Noteholders of the Series 2018-FT1 Term Notes and the Indenture Trustee that, as of the issuance date (a) the Series 2018-FT1 Term Notes are rated “BBB-(sf)” by the Note Rating Agency and (b) each of the conditions precedent set forth in the Base Indenture, including but not limited to those conditions precedent set forth in Section 6.10(b) of the Base Indenture and Article XII thereof, as applicable, to the issuance of the Series 2018-FT1 Term Notes have been satisfied or waived in accordance with the terms thereof.  

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Section 9. Representations and Warranties.

The Issuer, the Administrator, the Servicer and the Indenture Trustee hereby restate as of the related Issuance Date, or as of such other date as is specifically referenced in the body of such representation and warranty, all of the representations and warranties set forth in Sections 9.1, 10.1 and 11.14, respectively, of the Base Indenture.

The Administrator hereby represents and warrants that it is not in default with respect to any material contract under which a default should reasonably be expected to have a material adverse effect on the ability of the Administrator to perform its duties under this Indenture or any Indenture Supplement, or with respect to any order of any court, administrative agency, arbitrator or governmental body which would have a material adverse effect on the transactions contemplated hereunder, and no event has occurred which with notice or lapse of time or both would constitute such a default with respect to any such contract or order of any court, administrative agency, arbitrator or governmental body.

PMC hereby represents and warrants that it is not in default with respect to any material contract under which a default should reasonably be expected to have a material adverse effect on the ability of PMC to perform its duties under this Indenture, any Indenture Supplement or any Transaction Document to which it is a party, or with respect to any order of any court, administrative agency, arbitrator or governmental body which would have a material adverse effect on the transactions contemplated hereunder, and no event has occurred which with notice or lapse of time or both would constitute such a default with respect to any such contract or order of any court, administrative agency, arbitrator or governmental body.

Section 10. Amendments.

(a) Notwithstanding any provisions to the contrary in Article XII of the Base Indenture but subject to the provisions set forth in Sections 12.1 and 12.3 of the Base Indenture, without the consent of the Noteholders of any Notes but with the consent of the Issuer (evidenced by its execution of such amendment), the Indenture Trustee, the Administrator, the Servicer (solely in the case of any amendment that adversely affects the rights or obligations of the Servicer or adds new obligations or increases existing obligations of the Servicer), and the Administrative Agent, at any time and from time to time, upon delivery of an Issuer Tax Opinion and upon delivery by the Issuer to the Indenture Trustee of an Officer’s Certificate to the effect that the Issuer reasonably believes that such amendment will not have a material Adverse Effect, may amend any Transaction Document for any of the following purposes: (i) to correct any mistake or typographical error or cure any ambiguity, or to cure, correct or supplement any defective or inconsistent provision therein or in any other Transaction Document; or (ii) to amend any other provision of this Indenture Supplement.

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(b) Notwithstanding any provisions to the contrary in Section 6.10 or Article XII of the Base Indenture except for amendments otherwise permitted as described in Sections 12.1 and 12.2 of the Base Indenture and in the immediately preceding paragraph, no supplement, amendment or indenture supplement entered into with respect to the issuance of a new Series of Notes or pursuant to the terms and provisions of Section 12.2 of the Base Indenture may, without the consent of the Series Required Noteholders in respect of the Series 2018-FT1 Term Notes, supplement, amend or revise any term or provision of this Indenture Supplement; provided , that with respect to the following amendments, the consent of each Noteholder of each Outstanding Series 2018-FT1 Term Notes materially and adversely affected thereby shall be required:

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(c) For the avoidance of doubt, the consent of the Servicer is not required for (i) the waiver of any Event of Default or (ii) any other modification or amendment to any Event of Default except those related to the actions and omissions of the Servicer.  

(d) For the avoidance of doubt, the Issuer and the Administrator hereby covenant that the Issuer shall not issue any future Series of Notes without designating an entity to act as “Administrative Agent” under the related Indenture Supplement with respect to such Series of Notes.

(e) Any amendment of this Indenture Supplement which affects the rights, duties, immunities, obligations or liabilities of the Owner Trustee in its capacity as owner trustee under the Trust Agreement shall require the written consent of the Owner Trustee.  

Section 11. Counterparts.

This Indenture Supplement may be executed in any number of counterparts, by manual or facsimile signature, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this Indenture Supplement by facsimile or other electronic means shall be effective as delivery of a manually executed counterpart of this Indenture Supplement.

Section 12. Entire Agreement.

This Indenture Supplement, together with the Base Indenture incorporated herein by reference and the related Transaction Documents, constitutes the entire agreement among the parties hereto with respect to the subject matter hereof, and fully supersedes any prior or contemporaneous agreements relating to such subject matter.

Section 13. Limited Recourse.

Notwithstanding any other terms of this Indenture Supplement, the Series 2018-FT1 Term Notes, any other Transaction Documents or otherwise, the obligations of the Issuer under the Series 2018-FT1 Term Notes, this Indenture Supplement and each other Transaction Document to which it is a party are limited recourse obligations of the Issuer, payable solely from the Trust Estate, and following realization of the Trust Estate and application of the proceeds thereof in accordance with the terms of this Indenture Supplement, none of the Noteholders of Series 2018-FT1 Term Notes, the Indenture Trustee or any of the other parties to the Transaction Documents shall be entitled to take any further steps to recover any sums due but still unpaid hereunder or thereunder, all claims in respect of which shall be extinguished and shall not thereafter revive.  No recourse shall be had for the payment of any amount owing in respect of the Series 2018-FT1 Term Notes or this Indenture Supplement or for any action or inaction of the Issuer against any officer, director, employee, shareholder, stockholder or incorporator of the Issuer or any of their successors or assigns for any amounts payable under the Series 2018-FT1 Term Notes or this Indenture Supplement.  It is understood that the foregoing provisions of this Section 13 shall not (a) prevent recourse to the Trust Estate for the sums due or to become due under any security, instrument or agreement which is part of the Trust Estate, including, without limitation, the PC Guaranty and the PMT Guaranty or (b) save as specifically

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provided therein, constitute a waiver, release or discharge of any indebtedness or obligation evidenced by the Series 2018- FT1 Term Notes or secured by this Indenture Supplement.  It is further understood that the foregoing provisions of this Section 13 shall not limit the right of any Person to name the Issuer as a party defendant in any proceeding or in the exercise of any other remedy under the Series 2018- FT1 Term Notes or this Indenture Supplement, so long as no judgment in the nature of a deficiency judgment or seeking personal liability shall be asked for or (if obtained) enforced against any such Person or entity.

Section 14. Owner Trustee Limitation of Liability.

It is expressly understood and agreed by the parties hereto that (a) this Indenture Supplement is executed and delivered by Wilmington Savings Fund Society, FSB (“ WSFS ”), not individually or personally, but solely as trustee of the Issuer, in the exercise of the powers and authority conferred and vested in it, (b) each of the representations, warranties, undertakings and agreements herein made on the part of the Issuer is made and intended not as personal representations, warranties, undertakings and agreements by WSFS, but is made and intended for the purpose of binding only the Issuer, (c) nothing herein contained shall be construed as creating any liability on WSFS, individually or personally, to perform any covenant either expressed or implied contained herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under the parties hereto, (d) WSFS has made no investigation as to the accuracy or completeness of any representations or warranties made by the Issuer in this Agreement and (e) under no circumstances shall WSFS, be personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Indenture Supplement or the other Transaction Documents.

Section 15. Credit Risk Retention.

While it is not clear that Section 15G of the 1934 Act, added pursuant to Section 941(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“ Regulation RR ”), applies to the issuance of the Series 2018-FT1 Term Notes and that PMC will be deemed a securitizer for the purposes of Regulation RR, PMC will maintain a subordinated seller’s interest in the Issuer (in the form of the Owner Trust Certificate) that equals not less than 5% of the aggregate unpaid principal balance of any Outstanding Notes (other than Notes held to maturity by PMC or its wholly-owned affiliates), calculated in accordance with Regulation RR.

The seller’s interest expected to be retained by PMC in connection with Regulation RR (to the extent applicable), will equal approximately 21.0% or $94,682,583 (in each case, as calculated in accordance with Regulation RR), as of the Issuance Date.  As the Series 2017-VF1 Notes have not been issued and are held by PMC and financed by Credit Suisse AG, Cayman Islands Branch, the Note Balance of the Series 2017-VF1 Notes is not included in the denominator of the calculation that produced the percentage described above in accordance with Regulation RR.  The VFN Repurchase Agreement may be syndicated with other financing parties in addition to CSCIB on or about the Issuance Date. If the Note Balance of the Series 2017-VF1 Notes were included in the denominator, the resulting percentage of the seller’s interest would be lower but still in excess of the required 5%.

[Signatures follow]

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IN WITNESS WHEREOF , the undersigned have caused this Indenture Supplement to be duly executed by their respective signatories thereunto all as of the day and year first above written.

[PMT ISSUER TRUST – FMSR —Series 2018-FT1 Indenture Supplement]

[PMT ISSUER TRUST – FMSR —Series 2018-FT1 Indenture Supplement]

[PMT ISSUER TRUST – FMSR —Series 2018-FT1 Indenture Supplement]

[PMT ISSUER TRUST – FMSR —Series 2018-FT1 Indenture Supplement]