Footnote continued from previous
page
Footnote continued
As filed with the Securities and Exchange Commission on June 5, 2000
Registration Nos. 333-82583 and 333-82583-01
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------------
AMENDMENT NO. 1
TO
FORM S-3
Registration Statement
Under
The Securities Act of 1933
-----------------------------------
Countrywide Credit Industries, Inc.
Countrywide Home Loans, Inc.
(Exact name of registrants as specified in their charters)
-----------------------------------
Delaware New York
(State or other jurisdiction of (State or other jurisdiction
incorporation or organization) of
incorporation or organization)
13-2641992 13-2631719
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
4500 Park Granada
Calabasas, CA 91302
(818) 225-3000
(Address, including zip code, and telephone
number, including area code, of registrants'
principal executive offices)
Angelo R. Mozilo
Chairman of the Board and Chief Executive Officer
Countrywide Credit Industries, Inc.
and Chairman of the Board
Countrywide Home Loans, Inc.
4500 Park Granada
Calabasas, CA 91302
(818) 225-3000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-----------------------------------
Copies to:
Michael J. O'Sullivan Edward J. Fine
Munger, Tolles & Olson LLP Brown & Wood LLP
355 South Grand Avenue, 35th Floor One World Trade Center
Los Angeles, California 90071 New York, New York 10048
(213) 683-9100 (212) 839-5300
-----------------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement, as determined
by market conditions.
-----------------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.
(Continued on next page)
-----------------------------------
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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(Continued from previous page)
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.
<PAGE>
31
The information in this prospectus is not complete and may be changed. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
<PAGE>
Subject to Completion dated June 5, 2000
PROSPECTUS
Countrywide Credit Industries, Inc. [Logo]
Common Stock, Preferred Stock, Stock Purchase Contracts
and Debt Securities
Countrywide Home Loans, Inc.
Debt Securities
Payment of Principal, Premium, if any, and Interest Unconditionally
Guaranteed by
Countrywide Credit Industries, Inc.
------------------
Through this prospectus, we may periodically offer:
o shares of our common stock;
o shares of our preferred stock;
o contracts to purchase shares of our common stock or preferred
stock; and/or
o our debt securities,
and our subsidiary, Countrywide Home Loans, may periodically offer its debt
securities.
The prices and other terms of the securities that we or Countrywide
Home Loans will offer will be determined at the time of their offering.
We will guarantee all payments of principal of and any premium and
interest on any debt securities offered by Countrywide Home Loans.
The offering price of all securities issued under this prospectus may
not exceed $3,000,000,000.
Our common stock trades on the New York Stock Exchange under the symbol
"CCR." We will list any shares of our common stock sold under this prospectus on
the New York Stock Exchange.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is [ ], 2000.
<PAGE>
2
You should rely only on the information contained or incorporated by
reference in this prospectus and in any prospectus supplement accompanying this
prospectus and that we or Countrywide Home Loans have referred you to. Neither
we nor Countrywide Home Loans has authorized anyone to provide you with
information that is different. You should not assume that the information in
this prospectus or in any prospectus supplement is accurate as of any date other
than the date on the front of those documents.
References in this prospectus to "Countrywide Credit Industries," "we,"
"us" and "our" are to Countrywide Credit Industries, Inc.
References in this prospectus to "Countrywide Home Loans" are to
Countrywide Home Loans, Inc.
ADDITIONAL INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms. Our SEC filings are also available to the public
at the SEC's web site at http://www.sec.gov and at the public reference rooms of
the New York Stock Exchange, 20 Broad Street, New York, New York and the Pacific
Stock Exchange, 115 Sansome Street, San Francisco, California.
The SEC allows us to "incorporate by reference" the information we file
with it, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 until all the securities offered under this prospectus are
sold. This prospectus is part of the registration statement we filed with the
SEC.
1. Annual Report on Form 10-K for the year ended February 29, 2000.
2. Current Report on Form 8-K, dated June 1, 2000.
You may request a copy of these filings, at no cost, by writing or telephoning
us at Countrywide Credit Industries, Inc., 4500 Park Granada, Calabasas,
California 91302, telephone (818) 225-3000, Attention: Investor Relations.
<PAGE>
COUNTRYWIDE CREDIT INDUSTRIES AND COUNTRYWIDE HOME LOANS
Countrywide Credit Industries, Inc.
Through Countrywide Home Loans, our principal subsidiary, we originate,
purchase, securitize, sell and service mortgage loans. Our mortgage loans are
principally prime credit quality first-lien mortgage loans secured by single-
(one- to four-) family residences. We also offer home equity loans either with
newly produced prime credit quality mortgage loans or as a separate product. In
addition, we offer sub-prime credit quality first-lien single-family mortgage
loans.
Through our other subsidiaries, we also offer products and services
that complement our mortgage banking business. Through Countrywide Insurance
Services, Inc., we act as an agent for the sale of homeowners, fire, flood,
earthquake, life, disability and other types of insurance. We also issue life
insurance policies through Balboa Life Insurance Company and property and
casualty insurance polices through Balboa Insurance Company. Through LandSafe,
Inc., we act as a title insurance agent and provide settlement, escrow,
appraisal, credit reporting, flood zone determination and home appraisal
services, and we also provide property profiles to realtors, builders,
consumers, mortgage brokers and other financial institutions. Through Second
Charter Reinsurance Company, we partially reinsure some mortgage loans
originated by Countrywide Home Loans and insured by mortgage insurance
companies. Through CTC Real Estate Services, we serve as trustee under deeds of
trust in connection with foreclosures on loans in our servicing portfolio. We
also provide services through Countrywide Tax Services Corporation to ensure
that property taxes are paid when due during the terms of the loans that we
originate and/or service. Through Countrywide Servicing Exchange, a national
servicing brokerage and consulting firm, we facilitate transactions between
buyers and sellers of bulk servicing contracts. We also trade securities,
including mortgage-backed securities and other mortgage-related assets, with
broker-dealers and institutional investors through Countrywide Securities
Corporation, a registered securities broker-dealer. We also have two
subsidiaries, CWMBS, Inc. and CWABS, Inc., through which we issue mortgage- and
asset-backed securities that are backed by prime credit quality mortgage loans,
sub-prime credit quality loans or home equity loans.
We are a Delaware corporation, originally incorporated in New York
under the name of OLM Credit Industries, Inc. Our principal executive offices
are located at 4500 Park Granada, Calabasas, California 91302, and our telephone
number is (818) 225-3000.
Countrywide Home Loans, Inc.
As described above in "-- Countrywide Credit Industries, Inc.,"
Countrywide Home Loans originates, purchases, securitizes, sells and services
mortgage loans that are principally prime credit quality mortgage loans.
Countrywide Home Loans also offers home equity loans and sub-prime credit
quality loans. The principal sources of Countrywide Home Loans' revenue are: (1)
loan origination fees; (2) any gains from the sale of loans; (3) interest earned
on mortgage loans during the period that they are held by Countrywide Home Loans
pending sale, net of interest paid on funds borrowed to finance those mortgage
loans; (4) loan servicing fees; and (5) interest benefit derived from the
custodial balances associated with Countrywide Home Loans' servicing portfolio.
Countrywide Home Loans produces mortgage loans through three separate
divisions. The Consumer Markets Division originates prime credit quality
mortgage loans and home equity loans through referrals from real estate agents
and using direct contact with consumers through its nationwide network of retail
branch offices, its telemarketing systems and its site on the World Wide Web.
The Wholesale Division produces prime credit quality mortgage loans and home
equity loans through mortgage brokers and other financial intermediaries.
Through the Correspondent Division, Countrywide Home Loans purchases loans from
other mortgage bankers, commercial banks, savings and loan associations, credit
unions and other financial intermediaries. Countrywide Home Loans customarily
sells substantially all loans that it originates or purchases. To guarantee
timely and full payment of principal and interest on Fannie Mae securities,
Freddie Mac securities and Ginnie Mae securities and to transfer credit risk of
the loans, Countrywide Home Loans pays guarantee fees to these agencies.
Countrywide Home Loans services on a non-recourse basis substantially
all of the mortgage loans that it originates or purchases under servicing
agreements with Fannie Mae, Freddie Mac, Ginnie Mae and various investors. In
addition, Countrywide Home Loans purchases bulk servicing contracts, also on a
non-recourse basis, to service single-family residential mortgage loans
originated by other lenders. Servicing mortgage loans includes collecting and
remitting loan payments, answering questions from customers, making advances
when required, accounting for principal and interest, holding custodial
(impound) funds for payment of property taxes and hazard insurance, making any
physical inspections of the property, counseling delinquent mortgagors,
supervising foreclosures and property dispositions in the event of unremedied
defaults and generally administering the loans. Countrywide Home Loans receives
a fee for servicing mortgage loans ranging generally from 1/4% to 1/2% annually
on the declining principal balances of the loans. Countrywide Home Loans has
sold, and may sell in the future, a portion of its portfolio of loan servicing
rights to other mortgage servicers.
Countrywide Home Loans' principal financing needs are the financing of
its mortgage loan inventory and the investment in mortgage servicing rights. To
meet these needs, Countrywide Home Loans currently utilizes commercial paper
supported by its revolving credit facility, medium-term notes, mortgage
repurchase agreements, pre-sale funding facilities, an optional cash purchase
feature in the dividend reinvestment plan, redeemable capital trust pass-through
securities and cash flows from operations. In the past, Countrywide Home Loans
has utilized whole loan repurchase agreements, servicing-secured bank
facilities, private placements of unsecured notes and other financings, direct
borrowings from its revolving credit facility and public offerings of preferred
and common stock.
Countrywide Home Loans is a New York corporation, originally
incorporated in 1969. Its principal executive offices are located at 4500 Park
Granada, Calabasas, California 91302, and its telephone number is (818)
225-3000.
USE OF PROCEEDS
Except as we may otherwise state in any prospectus supplement, we
and/or Countrywide Home Loans intend to use the net proceeds from the sale of
the securities described in this prospectus for general corporate purposes,
including the retirement of debt and the investment in servicing rights through
the current production of loans and the bulk acquisition of contracts to service
loans, and for acquisitions.
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
Our selected consolidated financial data set forth below as of the end
of and for each of the five fiscal years in the period ended February 29, 2000
have been derived from, and should be read together with, our related audited
financial statements and accompanying notes incorporated by reference in this
prospectus. See "Additional Information."
<TABLE>
Years Ended February 29 (28)
<S> <C> <C> <C> <C> <C>
2000 1999 1998 1997 1996
(amounts in thousands, except Per Share and Operating Data)
Selected Statement of Earnings Data(1):
Revenues:
Loan origination fees...................... $406,458 $623,531 $301,389 $193,079 $199,724
Gain on sale of loans...................... 699,433 417,427 247,450 92,341
557,743
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Loan production revenue................. 964,201 1,322,964 718,816 440,529 292,065
Interest earned............................ 998,646 1,029,066 584,076 457,005 364,531
Interest charges........................... (983,829) (568,359) (423,447) (337,655)
(930,294)
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Net interest income..................... 68,352 45,237 15,717 33,558 26,876
Loan servicing income...................... 1,192,789 1,023,700 907,674 773,715 620,835
Amortization and impairment/recovery of
mortgage servicing rights, net of ------------- (600,766) (328,845) (226,686) (142,676)
servicing hedge........................
(445,138)
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Net loan administration income.......... 747,651 422,934 578,829 547,029 478,159
Commissions, fees and other income......... 234,047 187,867 138,217 91,346 63,642
Gain on sale of subsidiary................. -- 57,381 -- --
4,424
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Total revenues.......................... $2,018,675 $1,979,002 $1,508,960 $1,112,462 $860,742
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Expenses:
Salaries and related expenses.............. 689,768 669,686 424,321 286,884 229,668
Occupancy and other office expenses........ 276,802 270,483 182,335 129,877 106,298
Guarantee fees............................. 195,928 181,117 172,692 159,360 121,197
Marketing expenses......................... 72,930 64,510 42,320 34,255 27,115
Other operating expenses................... 161,401 121,746 80,188 50,264
152,049
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Total expenses.......................... 1,347,197 943,414 690,564 534,542
1,387,477
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Earnings before income taxes................. 631,198 631,805 565,546 421,898 326,200
Provision for income taxes................... 246,404 220,563 164,540 130,480
220,955
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Net earnings................................. $410,243 $385,401 $344,983 $257,358 $195,720
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Per Share Data(2):
Basic(3)................................... $3.63 $3.46 $3.21 $2.50 $1.99
Diluted(3)................................. $3.52 $3.29 $3.09 $2.44 $1.95
Cash dividends per share................... $0.40 $0.32 $0.32 $0.32 $0.32
Weighted Average Shares Outstanding:
Basic...................................... 113,083,000 111,414,000 107,491,000 103,112,000 98,352,000
Diluted.................................... 116,688,000 117,045,000 111,526,000 105,677,000 100,270,000
Selected Balance Sheet Data at End of
Period(1):
Mortgage loans and mortgage-backed
securities held for sale............... $2,653,183 $6,231,220 $5,292,191 $2,579,972 $4,740,087
Total assets............................... $15,822,328 $15,648,256 $12,183,211 $7,689,090 $8,321,652
Short-term debt............................ $2,911,410 $5,065,934 $4,043,774 $2,567,420 $4,423,738
Long-term debt............................. $7,253,323 $5,953,324 $4,195,732 $2,367,661 $1,911,800
Common shareholders' equity................ $2,887,879 $2,518,885 $2,087,943 $1,611,531 $1,319,755
Operating Data (dollar amounts in millions):
Loan servicing portfolio (4)............... $250,192 $215,489 $182,889 $158,585 $136,835
Volume of loans originated................. $66,740 $92,881 $48,772 $37,811 $34,584
Ratio of earnings to fixed charges(5)...... 1.66 1.63 1.98 1.98 1.95
------------------------------------
</TABLE>
(1) Certain amounts in the consolidated financial statements of
Countrywide Credit Industries have been reclassified to conform
to the fiscal year February 29, 2000 presentation.
(2) Adjusted to reflect the subsequent stock dividends and
splits.
(3) Earnings per share for the fiscal year ended February 28, 1998
include a $57.4 million gain on sale of subsidiary. Excluding
the non-recurring gain on sale of subsidiary, basic and diluted
earnings per share would have been $2.88 and $2.78,
respectively.
(4) Includes warehoused loans and loans under subservicing
agreements.
(5) For purposes of calculating the ratio of earnings to fixed
charges, earnings consist of income before U.S. federal income
taxes, plus fixed charges. Fixed charges include interest
expense on debt and the portion of rental expenses which is
considered to be representative of the interest factor
(one-third of operating leases).
<PAGE>
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock is not complete and is
qualified in its entirety by reference to our restated certificate of
incorporation and to any certificate of designations that we will file with the
SEC if we offer preferred stock under this prospectus. We have filed a copy of
our restated certificate of incorporation as an exhibit to the registration
statement of which this prospectus is part.
Common Stock
We have authorized under our restated certificate of incorporation
240,000,000 shares of common stock, par value $.05 per share. As of February 29,
2000, 113,464,650 shares of our common stock were issued and outstanding and
were held by 2630 record holders. Each record holder of our common stock is
entitled to cast one vote per share on all matters submitted to a vote of our
stockholders. We may pay dividends to the record holders of our common stock
only when, as and if declared by our board of directors, out of funds legally
available for those dividends. Each share of our common stock shares equally in
those dividends and in other distributions to holders of our common stock,
including distributions made if we liquidate, dissolve or wind up our affairs.
Our common stock carries no preemptive, conversion, subscription, redemption,
sinking fund or cumulative voting rights.
Preferred Stock Purchase Rights
In February 1988, our board of directors declared a dividend of one
preferred stock purchase right for each outstanding share of our common stock.
As the result of stock splits and stock dividends, 0.399 of a stock purchase
right is presently associated with each outstanding share of our common stock,
and 0.399 of a stock purchase right will be associated with each share of our
common stock that is issued prior to the Distribution Date (as defined below).
Each stock purchase right, when exercisable, allows its holder to purchase from
us one one-hundredth of a share of our Series A Participating Preferred Stock,
par value $0.05 per share, at a price of $145, subject to adjustments in some
instances to prevent dilution.
These stock purchase rights are evidenced by our common stock
certificates and may not be exercised or transferred apart from our common stock
until of the earlier of the date (the "Distribution Date") of a public
announcement that a person or group without our prior consent has acquired 20%
or more of our common stock (an "Acquiring Person") or the date that is ten days
(subject to extension by our board of directors) after a tender offer for our
common stock is commenced without our prior consent.
If any person becomes an Acquiring Person, each stock purchase right
(except those owned by the Acquiring Person) will allow its holder to purchase,
at the then current exercise price of the stock purchase right, the number of
shares of our common stock, or their equivalent, that, at the time of the
transaction, would have a market value of two times the exercise price of the
stock purchase right. Our board of directors may delay the exercisability of the
stock purchase rights during the period in which they are exercisable only for
our Series A Participating Preferred Stock (and not our common stock).
If after a person has become an Acquiring Person we are acquired in a
merger or other business combination, each stock purchase right (except those
held by the Acquiring Person) will entitle its holder to purchase, at the then
current exercise price of the stock purchase right, the number of shares of our
common stock, or their equivalent, of the other party (or its publicly traded
parent company) to the merger or business combination that at the time of the
transaction would have a market value of two times the exercise price of the
stock purchase right. The stock purchase rights expire on the earliest of
February 28, 2002, the date certain merger transactions close or the date we
elect to redeem the stock purchase rights before any person becomes an Acquiring
Person.
Preferred Stock
We have authorized under our restated certificate of incorporation
1,500,000 shares of preferred stock, par value $.05 per share. We will describe
the specific terms of any series of preferred stock we offer under this
prospectus in a prospectus supplement relating to that series of preferred
stock. Our board of directors is authorized to provide for the issuance of
preferred stock in one or more series with the distinctive designations as may
be stated in the resolution or resolutions providing for the issuance of that
preferred stock. At the time that it authorizes any series of preferred stock,
our board of directors will determine the number of shares constituting that
series and its designation and fix the dividend rights, any conversion rights,
any voting rights, redemption provisions, liquidation preferences and any other
rights, preferences, privileges and restrictions of that series.
At this time, our board of directors has authorized only one series of
preferred stock for issuance, and that series has been designated our Series A
Preferred Stock which is issuable upon the exercise of our stock purchase
rights. See "--Preferred Stock Purchase Rights" above. Our board of directors
could, without stockholder approval, cause us to issue preferred stock that has
voting, conversion and other rights that could adversely affect the holders of
our common stock or make it more difficult to cause a change in control of our
company. The preferred stock could be used to dilute the stock ownership of
persons seeking to obtain control of our company and thereby hinder a possible
takeover attempt which, if stockholders were offered a premium over the market
value of their shares, might be viewed as being beneficial to our stockholders.
In addition, the preferred stock could be issued with voting, conversion and
other rights and preferences that would adversely affect the voting power and
other rights of holders of our common stock.
Other Provisions of Our Restated Certificate of Incorporation and Our Bylaws
In addition to the stock purchase rights described above under
"--Preferred Stock Purchase Rights" and the terms of any preferred stock that we
may determine to issue as described above under "--Preferred Stock," other
provisions of our restated certificate of incorporation and our bylaws may make
it more difficult for a third party to acquire, or may discourage a third party
from attempting to acquire, control of our company. Our restated certificate of
incorporation includes the following provisions:
(1) It provides for a three-year staggered board of directors,
vacancies on which may be filled by the board of directors and
whose members may be removed only for cause and only by the
vote of the holders of two-thirds of the outstanding shares of
our common stock.
(2) It limits our power to purchase shares of our voting stock
from a five percent holder at a price exceeding its fair
market value, unless the purchase is approved by holders of a
majority of those voting shares (unless applicable law
requires a greater vote), without the vote of that five
percent holder. Voting stock is defined as capital stock that
has the right to vote generally on matters relating to our
company and any security which is convertible into that stock.
(3) It prohibits action by written consent of our stockholders.
(4) It provides that our bylaws may be amended by our board of
directors or, with some exceptions, by a vote of two-thirds of
our voting shares and further provides that a two-thirds vote
of all of our voting shares is required to amend the
provisions of our restated certificate of incorporation that
are described in this section, unless the amendment has been
approved by two-thirds of our board of directors and a
majority of our continuing directors. Continuing directors are
directors who became members of our board of directors before
any stockholder who beneficially owns ten percent of the
outstanding shares first became a ten percent stockholder.
Our bylaws provide that special meetings of the stockholders may be
called only by our directors and limits the business that may be transacted at
those meetings to those matters set forth in the request of the proposed
meeting.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is The Bank of
New York.
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
Unless we otherwise indicate in the applicable prospectus supplement,
we may issue stock purchase contracts, including contracts that would require
holders to purchase from us and for us to sell to them, a specified number of
shares of our common stock or preferred stock at a future date or dates. We may
fix what the consideration per share of common stock or preferred stock will be
when we issue the stock purchase contracts, and this consideration may be
determined by a formula that is described in the stock purchase contracts. We
may issue the stock purchase contracts separately or as part of stock purchase
units consisting of a stock purchase contract and debt securities, preferred
stock or debt obligations of third parties, including U.S. Treasury securities,
that secure the holders' obligations to purchase our common stock or preferred
stock under the stock purchase contracts. The stock purchase contracts may
require us to make periodic payments to the holders of the stock purchase units
or vice versa, and those payments may be unsecured or prefunded on some basis.
The stock purchase contracts may require holders to secure their obligations
under the stock purchase contracts in a specified manner.
Pledged Securities and Pledge Agreement
The securities subject to the stock purchase contracts (the "Pledged
Securities") will be pledged to a collateral agent, for our benefit, under the
terms of a pledge agreement. The Pledged Securities will secure the obligations
of holders of stock purchase contracts to purchase shares of our common stock or
preferred stock under the stock purchase contracts. The rights of holders of
stock purchase contracts to the related Pledged Securities will be subject to
our security interest therein created by the pledge agreement. No holder of
stock purchase contracts may withdraw the underlying pledged securities from the
pledge arrangement except upon the termination or early settlement of the stock
purchase contracts. Subject to that security interest and the terms of a
purchase contract agreement and the pledge agreement, each holder of a stock
purchase contract will keep full beneficial ownership of the related pledged
securities.
Except as we may describe in the applicable prospectus supplement, the
collateral agent will, upon receipt of distributions on the pledged securities,
distribute those payments to us or to the purchase contract agent, as provided
in the pledge agreement. The purchase contract agent will in turn distribute
payments it receives as provided in the purchase contract agreement.
We will describe the terms of any stock purchase contracts or stock
purchase units that we offer under this prospectus in a prospectus supplement.
The description in the prospectus supplement will not necessarily be complete
and will be qualified in its entirety by reference to the stock purchase
contracts and, if applicable, collateral arrangements and depositary
arrangements, relating to such stock purchase contracts or stock purchase units.
DESCRIPTION OF DEBT SECURITIES OF COUNTRYWIDE CREDIT INDUSTRIES
The following description summarizes some of the general terms and
conditions of the debt securities that we may issue under this prospectus. We
will describe the particular terms of any debt securities that we offer and the
extent to which the general provisions below will apply to those debt securities
in a prospectus supplement relating to those debt securities.
We will issue these debt securities under a senior debt indenture or a
subordinated debt indenture. The Bank of New York will serve as the trustee
under both indentures. The terms of the debt securities will include those
stated in the applicable indenture and those made part of that indenture by
reference to the Trust Indenture Act. The debt securities will be subject to all
those terms, and we refer the holders of the debt securities to the applicable
indenture and the Trust Indenture Act for a statement of those terms. Unless we
otherwise indicate, capitalized terms have the meanings given them in that
indenture.
The applicable prospectus supplement will specify whether the debt
securities we issue will be senior, senior subordinated or subordinated
(including, if applicable, junior subordinated) debt. The debt securities may be
convertible into shares of our preferred stock or common stock or may be issued
as part of units of debt securities and other securities that we may offer under
this prospectus. If we issue debt securities as part of units consisting of debt
securities and other securities we may issue under this prospectus or in
exchange for shares of our preferred stock, we will describe any applicable
material federal income tax consequences to holders in the applicable prospectus
supplement.
The following summaries of various provisions of the indentures and the
debt securities are not complete. Except to the extent we specify in the
prospectus supplement relating to a particular issue of debt securities, the
indentures are substantially identical, except for the subordination provisions,
including the provision that the debt securities issued under the senior debt
indenture ("senior debt securities") will rank senior to the debt securities
issued under the subordinated debt indenture ("subordinated debt securities").
General
The indentures will not limit the amount of additional indebtedness
that we or any of our subsidiaries may incur, except as we may provide in the
applicable prospectus supplement. The debt securities will be senior or
subordinated obligations as described in the applicable prospectus supplement.
We will indicate in the applicable prospectus supplement the following
terms of and information concerning any debt securities we issue (to the extent
those terms apply to those debt securities and have not been otherwise
described):
(1) the specific title, aggregate principal amount, denomination and form;
(2) the date of maturity (or the method by which that date may be determined or
extended);
(3) any interest rate or rates, whether fixed or floating (or the method by
which that rate those rates will be determined);
(4) the date from which interest will accrue (or the method by which that date
may be determined or reset), the dates on which that interest will be payable
and the record date for any interest payable on the interest payment date and
the basis upon which interest will be calculated if other than that of a 360-day
year of twelve 30-day months;
(5) the place or places where the principal of and any premium and any interest
on the debt securities will be payable, or where those debt securities may be
surrendered for registration of transfer or exchange, if not the corporate trust
office of the trustee for those debt securities;
(6) the portion of the principal amount of debt securities of the series payable
upon certain declarations of acceleration or the method by which that portion
shall be determined;
(7) the denominations and the currency, currencies, currency units or composite
currencies in which the debt securities will be issuable;
(8) the currency, currencies, currency units or composite currencies in which
payments on the debt securities will be made, if not U.S. dollars;
(9) whether the debt securities are senior debt securities or subordinated debt
securities, and if subordinated debt securities, the terms of the subordination;
(10) any redemption, repayment or sinking fund provisions, including the period
or periods within which, the currency, currencies, currency units or composite
currencies in which and the other terms and conditions upon which we may redeem
the debt securities;
(11) the ability of a holder of a debt security to renew all or any portion of a
debt security;
(12) whether the debt securities are convertible into or exchangeable for our
common stock or preferred stock and the terms of the security into which they
are convertible or exchangeable (see "Description of Capital Stock"), the
conversion price or exchange ratio, other terms related to conversion and
exchange and any anti-dilution protections;
(13) whether the debt securities will be sold as part of units consisting of
debt securities and other securities that we may offer under this prospectus;
(14) if the amount of payments of principal of or any premium or interest on any
debt securities of the series may be determined by reference to an index,
formula or other method, the index, formula or other method by which those
amounts will be determined;
(15) whether and by what method the debt securities of the series (or certain
covenants under the related indenture) may be defeased and discharged by us;
(16) whether the debt securities of the series shall be issued in whole or in
part as book-entry securities;
(17) any applicable material federal income tax consequences; and
(18) any other material specific terms of the debt securities, including any
material additional events of default or covenants provided for and any material
terms that may be required by or advisable under applicable laws or regulations.
Unless we otherwise indicate in the applicable prospectus supplement,
we will issue debt securities only in fully registered form without coupons. The
debt securities denominated in U.S. dollars will be issued in denominations of
$1,000 or integral multiples of $1,000 unless we otherwise provide in the
applicable prospectus supplement. The prospectus supplement relating to a series
of debt securities denominated in a foreign currency or currency unit will
specify the denominations in which those debt securities may be issued.
The indentures do not contain any provisions that would limit our
ability or the ability of any of our affiliates to incur indebtedness (secured
or unsecured) or that would afford holders of the debt securities protection in
the event of a highly leveraged transaction, restructuring, change in control,
merger or similar transaction involving us that may adversely affect holders of
the debt securities.
Unless we otherwise indicate in the applicable prospectus supplement,
the principal of, and any premium or interest on, any series of debt securities
will be payable, and those debt securities will be exchangeable and transfers of
them will be registerable, at the corporate trust office of the trustee,
initially at 101 Barclay Street, New York, New York 10286. However, we may elect
to make interest payments by check mailed to the address of the person entitled
to them as that address appears in the security register for those debt
securities.
None of the debt securities will be entitled to any benefit under the
applicable indenture or be valid or obligatory for any purpose unless there
appears on the debt security a certificate of authentication substantially in
the form provided in that indenture that is duly executed by the trustee, and
that certificate will be conclusive evidence and the only evidence that the debt
security has been duly authenticated and delivered under and is entitled to the
benefits of that indenture.
Subordination of Subordinated Debt Securities
Our obligations under the debt securities will be subordinate in right
of payment to all present and future senior indebtedness to the extent provided
in the indenture. Upon any payment or distribution of assets to creditors upon
any liquidation, dissolution, winding up, reorganization, assignment for the
benefit of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with our insolvency or
bankruptcy, the holders of senior indebtedness will first be entitled to receive
payment in full of that senior indebtedness before the holders of the debt
securities will be entitled to receive or retain any payment.
No payments on account of principal of or any premium or interest on
the debt securities (including payments on exercise of debt security put
options) may be made if a default in any payment on senior indebtedness has
occurred and is continuing, or an event of default on any senior indebtedness
resulting in the acceleration of its maturity has occurred, or if any judicial
proceeding is pending with respect to any such default.
In the event the maturity of the debt securities is accelerated, the
holders of all senior indebtedness outstanding at the time of the acceleration
will first be entitled to receive payment in full of all amounts due in respect
of that senior indebtedness before the holders of the debt securities will be
entitled to receive or retain any payment related to the debt securities.
Amounts that would be due and payable by us to holders of units in the
absence of the foregoing subordination provisions, however, may be applied by
those holders to offset their obligations under their respective purchase
contracts.
Any subordinated debt securities will be subordinate and junior in
right of payment, to the extent and in the manner described in the indenture, to
all of our, "senior indebtedness." Unless we otherwise indicate in the
prospectus supplement, "senior indebtedness" means:
(1) the principal, premium, if any, and interest in respect of
indebtedness for money borrowed and indebtedness evidenced by
securities, debentures, bonds or other similar instruments;
(2) all capital lease obligations;
(3) all obligations issued or assumed as the deferred purchase
price of property, all conditional sale obligations and all
obligations under any title retention agreement, excluding
trade accounts payable arising in the ordinary course of
business;
(4) all obligations for the reimbursement on any letter of credit,
any banker's acceptance, any security purchase facility, any
repurchase agreement or similar arrangement, any interest rate
swap, any other hedging arrangement, any obligation under
options or any similar credit or other transaction;
(5) all obligations of the type referred to in clauses (1) through
(4) above of others, the payment of which we are responsible
or liable as obligor, guarantor or otherwise; and
(6) all obligations of the type referred to in clauses (1) through
(5) above of others secured by any lien on any of our
properties or assets, whether or not the obligation is assumed
by us,
except for:
(a) any indebtedness that states, or is issued under a
deed, indenture or other instrument that states, that
it is subordinate to or ranks equally with the debt
securities;
(b) any indebtedness between or among us and any of our affiliates;
(c) the indebtedness represented by our guarantee of the 8% Junior Subordinated
Deferrable Interest Debentures due December 15, 2026 of Countrywide Home Loans;
and
(d) the indebtedness represented by our guarantee of the
8.05% Junior Subordinated Debentures due June 15,
2027 of Countrywide Home Loans.
Redemption
If and to the extent we provide in the applicable prospectus
supplement, we will have the right to redeem the debt securities, in whole or
from time to time in part, after the date and at the redemption prices set forth
in the applicable prospectus supplement.
Events of Default
The indentures define an event of default for the debt securities of
any series as:
(1) failure to pay principal (or premium) on any debt security of that series at
maturity;
(2) failure to pay interest on any debt security of that series within 30 days
of the date when due;
(3) failure to deposit any sinking fund payment when due for that series within
30 days of the date when due;
(4) failure to perform for 90 days after notice any of the other covenants in
the indentures;
(5) certain events of bankruptcy, insolvency or reorganization;
(6) failure to pay the put price when due upon exercise of a debt security put
option;
(7) default resulting in the acceleration of maturity of any other indebtedness
for money borrowed by us or by any of our direct or indirect subsidiaries in an
amount exceeding $10,000,000 and that acceleration not being rescinded or
annulled for a period of 10 days after written notice of the default by the
trustee or the holders of at least 25% in aggregate principal amount of the then
outstanding debt securities of that series; and
(8) any other event of default provided for debt securities of that series.
The indentures provide that if any event of default affecting
outstanding debt securities of any series occurs and is continuing, either the
trustee or the holders of at least 25% in principal amount of the outstanding
debt securities of that series may declare the principal amount (or, if the debt
securities of that series are original issue discount securities or indexed
securities, the portion of the principal amount of those debt securities as
specified by their terms) of all debt securities of that series to be due and
payable immediately. However, under certain circumstances the holders of a
majority in principal amount of the outstanding debt securities of that series
on behalf of the holders of all debt securities of that series may annul a
declaration and waive past defaults (except, unless previously cured, a default
in payment of principal of or any premium or any interest on the debt securities
of that series and other specified defaults).
We refer you to the prospectus supplement relating to each series of
debt securities that are original issue discount securities for the particular
provisions regarding acceleration of the maturity of a portion of the principal
amount of those original issue discount securities if an event of default occurs
and continues.
The agreements governing our outstanding indebtedness contain
provisions that would characterize some events of default under the indentures
as "events of default" under those agreements that could in turn result in,
among other things, an acceleration of indebtedness under those agreements.
The indentures contain a provision entitling the trustee, subject to
its duty to act with the required standard of care during a default under any
series of debt securities, to be indemnified by the holders of debt securities
of that series before exercising any right or power under the indentures at the
request of the holders of the debt securities of that series.
The indentures provide that no holder of debt securities of any series
may institute proceedings, judicial or otherwise, to enforce the applicable
indenture except if the trustee fails to act for 60 days after it receives a
written request to enforce that indenture by the holders of at least 25% in
aggregate principal amount of the then outstanding debt securities of that
series and an offer of reasonable indemnity. This provision will not prevent any
holder of debt securities from enforcing payment of the principal of and any
premium and interest on those debt securities when due. The holders of a
majority in aggregate principal amount of the debt securities of any series
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the trustee or exercising any trust or power
conferred on it with respect to those debt securities. However, the trustee may
refuse to follow any direction that it determines would be illegal or would
conflict with the indentures or involve it in personal liability or which would
unjustly prejudice holders of the debt securities of that series not joining the
proceeding.
The indentures provide that the trustee will, within 90 days after a
default occurs that affects the outstanding debt securities of any series, give
to the holders of those debt securities notice of that default, unless that
default has been cured or waived. Except in the case of a default in the payment
of principal of, or any premium or interest on, any debt securities or payment
of any sinking fund installment, the trustee will be protected in withholding of
that notice if it determines in good faith that the withholding of that notice
is in the interest of the holders of the debt securities of that series.
We will be required to file with the trustee annually an officers'
certificate as to the absence of certain defaults under the terms of the
indenture.
Defeasance of Debt Securities or Some Covenants
Defeasance and Discharge. Unless we otherwise indicate in the
applicable prospectus supplement, the debt securities of any series will provide
that we will be discharged from all obligations under the debt securities of
that series (except for obligations to register the transfer or exchange of debt
securities of that series, to replace stolen, lost or mutilated debt securities
of that series, to maintain paying agencies and to hold moneys for payment in
trust) once we deposit with the trustee, in trust, money and/or U.S. government
obligations, which through the payment of interest and principal, will provide a
sufficient amount of money to pay and discharge the principal of (and any
premium) and any interest on, and any mandatory sinking fund payments that apply
to, the debt securities of that series on the stated maturity of those payments.
This discharge may occur only if, among other things, we deliver to the trustee
an opinion of counsel stating that we have received from, or there has been
published by, the IRS a ruling, or there has been a change in tax law, that
would cause the discharge not to be deemed, or result in, a taxable event for
the holders of the debt securities of that series.
Defeasance of Some Covenants. Unless we otherwise provide in the
applicable prospectus supplement, the debt securities of any series will permit
us not to comply with some restrictive covenants, including those relating to
consolidation and merger in the indentures, if we satisfy certain conditions. We
will be able to defease those covenants if, among other things:
(1) we deposit with the trustee money and/or U.S. government
obligations, which, through the payment of interest and
principal, will provide a sufficient amount of money to pay
the principal of (and any premium) and any interest on, and
any mandatory sinking fund payments applicable to, the debt
securities of that series on the stated maturity of those
payments; and
(2) we deliver to the trustee an opinion of counsel stating that
the deposit and related covenant defeasance will not cause the
holders of the debt securities of that series to recognize
income, gain or loss for federal income tax purposes.
If we elect to defease the covenants of a series of debt securities and
those debt securities are declared due and payable because an event of default
has occurred, the amount of money and/or U.S. government obligations on deposit
with the trustee will be sufficient to pay amounts due on those debt securities
at their stated maturity but may not be sufficient to pay amounts due on those
debt securities at the time of the acceleration. However, we will remain liable
for those payments.
We will state in the prospectus supplement for any particular series of
debt securities if any defeasance provisions will apply to those debt
securities.
Modification of the Indenture and Waiver of Covenants
The indentures permit us and the trustee, with the consent of the
holders of at least a majority in principal amount of outstanding debt
securities of each series affected, to execute supplemental indentures adding
provisions to or changing or eliminating provisions of the indentures or
modifying the rights of the holders of outstanding debt securities of that
series, except that no supplemental indenture may, without the consent of the
holder of each outstanding debt security affected:
(1) change the stated maturity, or reduce the principal amount, any premium on
or the rate of payment of any interest on, of any debt security of any series;
(2) reduce the percentage of outstanding debt securities of any
series, the consent of the holders of which is required for
any supplemental indenture or for waiver of compliance with
certain provisions of the indenture or certain defaults
thereunder; or
(3) effect various other changes.
The indentures also allow us not to comply with certain covenants in
the indentures upon waiver by the holders of a majority in principal amount of
outstanding debt securities of the series affected.
Consolidation, Merger and Sale of Assets
The indentures allow us, without the consent of the holders of any of
the outstanding debt securities, to consolidate with or merge into any other
corporation or transfer or lease our assets substantially as an entirety to any
person if:
(1) the successor is a corporation organized under the laws of any domestic
jurisdiction;
(2) the successor corporation assumes our obligations on the debt securities and
under the indentures;
(3) after giving effect to the transaction no event of default, and no event
which, after notice or lapse of time, would become an event of default, shall
have happened and be continuing; and
(4) certain other conditions are met.
Concerning the Trustee
The Bank of New York is the trustee under each of the senior debt
indenture and the subordinated debt indenture. We and Countrywide Home Loans
maintain banking relationships in the ordinary course of business with the
trustee. Among other things, The Bank of New York is a lending bank under an
existing revolving credit facility of Countrywide Home Loans and serves as
transfer agent and registrar for our common stock.
Governing Law
Unless we otherwise specify in the applicable prospectus supplement,
the indentures for the debt securities and the debt securities will be governed
by New York law.
<PAGE>
DESCRIPTION OF DEBT SECURITIES OF COUNTRYWIDE HOME LOANS AND RELATED GUARANTEES
OF COUNTRYWIDE CREDIT INDUSTRIES
The following description summarizes some of the general terms and
conditions of the debt securities that Countrywide Home Loans may issue under
this prospectus (the "CHL debt securities"). Countrywide Home Loans will
describe the particular terms of any CHL debt securities that it offers and the
extent to which the general provisions below will apply to those CHL debt
securities in a prospectus supplement relating to those CHL debt securities.
Countrywide Home Loans will issue CHL debt securities either (1) under
an Indenture, dated as of January 1, 1992, as amended by Supplemental Indenture
No. 1, dated as of June 15, 1995 (as it may be further amended or supplemented,
the "CHL senior indenture"), among Countrywide Home Loans, Countrywide Credit
Industries, as guarantor (the "Guarantor"), and The Bank of New York, as trustee
( the "CHL senior trustee"), or (2) under a subordinated debt indenture (the
"CHL subordinated indenture") to be entered into among Countrywide Home Loans,
the Guarantor and The Bank of New York, as trustee (the "CHL subordinated
trustee"). Any series of CHL debt securities that Countrywide Home Loans issues
under the CHL senior indenture will constitute unsubordinated debt of
Countrywide Home Loans ("CHL senior debt securities") and will rank senior to
any series of CHL debt securities that Countrywide Home Loans issues under the
CHL subordinated indenture ("CHL subordinated debt securities").
Countrywide Home Loans will issue each series of CHL debt securities
under the terms of an amendment or supplement to the applicable CHL indenture
that takes the form of a supplemental indenture or an officers' certificate
delivered under the authority of resolutions adopted by Countrywide Home Loans'
board of directors and the terms of that CHL indenture. The terms of any CHL
debt securities will include those stated in the applicable CHL indenture and
those made part of that CHL indenture by reference to the Trust Indenture Act.
The CHL debt securities will be subject to all those terms, and we refer the
holders of CHL debt securities to the applicable CHL indenture and the Trust
Indenture Act for a statement of those terms.
The following summaries of various provisions of the CHL indentures and
the CHL debt securities are not complete and are qualified in their entirety by
reference to the provisions of the CHL indentures, including the definitions of
capitalized terms used in this section without definition. Unless we otherwise
indicate, capitalized terms have the meanings given them in the applicable CHL
indenture.
The applicable prospectus supplement will specify whether the CHL debt
securities that Countrywide Home Loans issues will be senior, senior
subordinated or subordinated (including, if applicable, junior subordinated)
debt. The CHL debt securities may be issued as part of units consisting of CHL
debt securities and securities that we may offer under this prospectus. If
Countrywide Home Loans issues debt securities as part of units of CHL debt
securities and securities that we may issue under this prospectus, we and
Countrywide Home Loans will describe any applicable material federal income tax
consequences to holders in the applicable prospectus supplement.
Senior Indenture
General
The CHL senior indenture does not limit the aggregate principal amount
of CHL senior debt securities that Countrywide Home Loans may issue periodically
in series.
The CHL senior debt securities will be unsecured and unsubordinated
indebtedness of Countrywide Home Loans and will rank equally in right of payment
with Countrywide Home Loans' other unsecured and unsubordinated indebtedness. A
substantial portion of the assets of Countrywide Home Loans may be pledged under
various credit agreements among Countrywide Home Loans and various lending
institutions.
We refer you to the prospectus supplement and any pricing supplement
relating to any particular series of CHL senior debt securities offered by
Countrywide Home Loans for a description of the terms of those CHL senior debt
securities, including, where applicable:
(1) the title of those CHL senior debt securities;
(2) any limit on the aggregate principal amount of those CHL
senior debt securities;
(3) the date or dates (or any method or methods by which that date
or those dates will be determined or extended) on which the
principal of those CHL senior debt securities is payable;
(4) any places other than the Countrywide Home Loans' office or
agency in The City of New York where those CHL senior debt
securities will be payable or surrendered for registration of
transfer or exchange;
(5) the denominations in which those CHL senior debt securities
will be issuable;
(6) the currency in which those CHL senior debt securities may be
denominated, which may be U.S. dollars or any foreign currency
or currency unit, and, if applicable, other information
regarding that foreign currency or currency unit;
(7) the designation of the currency or currencies in which payment
of the principal of and any premium and interest on those CHL
senior debt securities will be made and whether payment of the
principal of or any premium or the interest on CHL senior debt
securities designated in a foreign currency or currency unit,
at the holder's election, may instead be payable in U.S.
dollars and the terms and conditions upon which that election
may be made;
(8) any rate or rates (which may be fixed or floating) at which
those CHL senior debt securities will bear interest (or any
method or methods by which that rate or those rates are to be
determined or reset), any date or dates from which that
interest will accrue (or any method or methods by which that
date or those dates will be determined or reset), the dates on
which that interest will be payable, the record date for the
interest payable on any interest payment date, and the basis
upon which interest will be calculated if other than that of a
360-day year of twelve 30-day months;
(9) any terms and conditions on which those CHL senior debt
securities may be redeemed at Countrywide Home Loans' option
or repaid at the holders' option;
(10) any obligation of Countrywide Home Loans to redeem, repay or
purchase those CHL senior debt securities under the terms of
any sinking fund or analogous provisions, and the terms and
conditions on which those CHL senior debt securities will be
redeemed, repaid or purchased, in whole or in part, under the
terms of that obligation;
(11) if other than the principal amount, the portion of the
principal amount of those CHL senior debt securities that will
be payable upon declaration of acceleration of the maturity of
those CHL senior debt securities;
(12) any provisions for the defeasance of those debt securities;
(13) any ability a holder of a CHL senior debt security may have to
renew all or any portion of a CHL senior debt security;
(14) any additional Events of Default or restrictive covenants
applicable to those CHL senior debt
securities;
(15) any other terms not inconsistent with the CHL senior
indenture, including any terms which may be required by or
advisable under United States laws or regulations;
(16) if those CHL senior debt securities are denominated or payable
in a currency or currency unit other than U.S. dollars, the
designation of the initial Exchange Rate Agent and, if other
than as set forth in the CHL Indenture, the definition of the
"Exchange Rate"; and
(17) the form of those CHL senior debt securities and, if in global
form, the name of the depositary and the terms upon which and
the circumstances under which those CHL senior debt securities
may be exchanged.
Unless Countrywide Home Loans otherwise indicates in the applicable
prospectus supplement, Countrywide Home Loans will issue CHL senior debt
securities only in fully registered form without coupons. CHL senior debt
securities denominated in U.S. dollars will be issued in denominations of $1,000
or integral multiples of $1,000 unless Countrywide Home Loans otherwise provides
in the applicable prospectus supplement. The prospectus supplement relating to a
series of CHL senior debt securities denominated in a foreign currency or
currency unit will specify the denominations in which those CHL senior debt
securities may be issued.
The CHL senior indenture does not contain any provisions that would
limit the ability of Countrywide Home Loans or any of its affiliates to incur
indebtedness (secured or unsecured) or that would afford holders of CHL senior
debt securities protection in the event of a highly leveraged transaction,
restructuring, change in control, merger or similar transaction involving
Countrywide Home Loans that may adversely affect holders of the CHL senior debt
securities.
Countrywide Home Loans may sell one or more series of CHL senior debt
securities at a substantial discount below their stated principal amount, and
those CHL senior debt securities may bear no interest or interest at a rate that
at the time of issuance is below market rate. One or more series of CHL senior
debt securities may be floating rate debt securities and may be exchangeable for
fixed rate debt securities. Countrywide Home Loans will describe any federal
income tax consequences and special considerations applicable to any particular
series in the applicable prospectus supplement.
Unless Countrywide Home Loans otherwise indicates in the applicable
prospectus supplement, the principal of, and any premium or interest on, any
series of CHL senior debt securities will be payable, and those CHL senior debt
securities will be exchangeable and transfers of them will be registerable, at
the Corporate Trust Office of the CHL senior trustee, initially at 101 Barclay
Street, New York, New York 10286. However, Countrywide Home Loans may elect to
make interest payments by check mailed to the address of the person entitled to
them as that address appears in the security register for those CHL senior debt
securities.
No CHL senior debt security will be entitled to any benefit under the
CHL senior indenture or be valid or obligatory for any purpose unless there
appears on that CHL senior debt security a certificate of authentication
substantially in the form provided in the CHL senior indenture that is duly
executed by the CHL senior trustee, and that certificate will be conclusive
evidence and the only evidence that that CHL senior debt security has been duly
authenticated and delivered under and is entitled to the benefits of the CHL
senior indenture.
Events of Default
The CHL senior indenture provides that the following are "Events of
Default" that apply to any series of CHL senior debt securities:
(1) default in payment of principal of (or any premium on) any CHL
senior debt security of that series at maturity;
(2) default for 30 days in payment of interest on any CHL senior
debt security of that series when due;
(3) default in the deposit of any sinking fund payment on any CHL
senior debt security of that series when due;
(4) default in the performance or breach of any other covenant or
warranty of Countrywide Home Loans or the Guarantor in the CHL
senior indenture, the CHL senior debt securities or the
related Guarantees, continued for 60 days after written notice
of default by the CHL senior trustee or the holders of at
least 25% in aggregate principal amount of the then
outstanding CHL senior debt securities of that series;
(5) default resulting in acceleration of maturity of any other
indebtedness for borrowed money of Countrywide Home Loans, the
Guarantor or any direct or indirect subsidiary of the
Guarantor in an amount exceeding $10,000,000 and that
acceleration shall not be rescinded or annulled for a period
of 10 days after written notice of the default by the CHL
senior trustee or the holders of at least 25% in aggregate
principal amount of the then outstanding CHL senior debt
securities of that series;
(6) certain events of bankruptcy, insolvency or reorganization;
and
(7) any other Event of Default applicable to that series of CHL
senior debt securities.
No Event of Default applicable to a particular series of CHL senior
debt securities necessarily constitutes an Event of Default applicable to any
other series of CHL senior debt securities.
The CHL senior indenture provides that if an Event of Default occurs
and continues, either the CHL senior trustee or the holders of at least 25% in
aggregate principal amount of the CHL senior debt securities of that series then
outstanding may declare the principal amount of those CHL senior debt securities
(or, if they are Original Issue Discount Securities, the amount as provided in
the terms of those Original Issue Discount Securities) to be due and payable
immediately upon written notice of acceleration to Countrywide Home Loans. In
some cases, the holders of a majority in aggregate principal amount of the
outstanding CHL senior debt securities of that series may, on behalf of the
holders of all those CHL senior debt securities, rescind and annul that
declaration of acceleration. "Original Issue Discount Security" means, except as
otherwise defined in a CHL senior debt security, any CHL senior debt security
that is issued with original issue discount within the meaning of Section
1273(a) of the Internal Revenue Code of 1986 and related regulations.
The agreements governing certain of Countrywide Home Loans' outstanding
indebtedness contain provisions that would characterize some Events of Default
under the CHL senior indenture as events of default under those agreements that
could in turn result in, among other things, an acceleration of the indebtedness
under those agreements.
The CHL senior indenture contains a provision entitling the CHL senior
trustee, subject to its duty to act with the required standard of care during
default under any series of CHL senior debt securities, to be indemnified by the
holders of the CHL senior debt securities of that series before exercising any
right or power under the CHL senior indenture at the request of the holders of
CHL senior debt securities of that series. The CHL senior indenture provides
that no holders of CHL senior debt securities of any series may institute any
proceedings, judicial or otherwise, to enforce the CHL senior indenture except
if the CHL senior trustee fails to act for 60 days after it receives a written
request to enforce the CHL senior indenture by the holders of at least 25% in
aggregate principal amount of the then outstanding CHL senior debt securities of
that series and an offer of reasonable indemnity. This provision will not
prevent any holder of CHL senior debt securities from enforcing payment of the
principal thereof and any premium and interest on those CHL senior debt
securities when due. The holders of a majority in aggregate principal amount of
the CHL senior debt securities of any series then outstanding may direct the
time, method and place of conducting any proceeding for any remedy available to
the CHL senior trustee or exercising any trust or power conferred on it with
respect to those CHL senior debt securities. However, the CHL senior trustee may
refuse to follow any direction that it determines would be illegal or would
conflict with the CHL senior indenture or involve it in personal liability or
that would unjustly prejudice holders of the CHL senior debt securities of that
series not joining the proceeding.
The CHL senior indenture provides that the CHL senior trustee will,
within 90 days after a default occurs that affects the outstanding CHL senior
debt securities of any series, give to the holders of those CHL senior debt
securities notice of that default, unless that default has been cured or waived.
Except in the case of a default in the payment of principal of, or any premium
or interest on any CHL senior debt securities or payment of any sinking fund
installment, the CHL senior trustee will be protected in the withholding of that
notice if it determines in good faith that the withholding of that notice is in
the interest of the holders of the CHL senior debt securities of that series.
Countrywide Home Loans will be required to file with the CHL senior
trustee annually an officers' certificate as to the absence of certain defaults
under the terms of the CHL senior indenture.
Modification and Waiver
Countrywide Home Loans, the Guarantor and the CHL senior trustee may
modify or amend the CHL senior indenture with the consent of the holders of a
majority in aggregate principal amount of the outstanding CHL senior debt
securities of each series affected by that modification or amendment; provided,
however, that no modification or amendment may, without the consent of the
holder of each outstanding CHL senior debt security affected:
(1) except as the CHL Indenture otherwise permits for CHL senior
debt securities for which the Stated Maturity is extendible,
change the Stated Maturity of the principal of, or any
installment of interest on, that CHL senior debt security;
(2) reduce the principal amount of, or, except as the CHL
Indenture otherwise permits for CHL senior debt securities for
which the interest rate may be reset, interest on, or any
premium payable upon redemption or repayment of, that CHL
senior debt security;
(3) reduce the amount of the principal of an Original Issue
Discount Security that would be due and
payable upon a declaration of acceleration of its Maturity;
(4) adversely affect the right of repayment at the option of a
holder of that CHL senior debt
security;
(5) reduce the amount of, or postpone the date fixed for, any
payment under any sinking fund or analogous provisions of that
CHL senior debt security;
(6) change the place or currency or currency unit of payment of
the principal of or any premium or
interest on that CHL senior debt security;
(7) change or eliminate the rights of a holder to receive payment
in a designated currency;
(8) impair the right to institute suit for the enforcement of any
required payment on or with
respect to that CHL senior debt security;
(9) reduce the percentage of the aggregate principal amount of the
outstanding CHL senior debt securities of any series the
consent of whose holders is required to modify or amend the
CHL senior indenture, to waive compliance with certain
provisions of the CHL senior indenture, or to waive certain
defaults;
(10) modify any of the provisions of Section 613 (described below)
except to increase the percentage or to provide that some
other provisions of the CHL Indenture cannot be modified or
waived without the consent of the holder of each outstanding
CHL senior debt security affected by the modification or
waiver; or
(11) modify or affect the terms and conditions of the related
Guarantees in a manner adverse to the interests of the holders
of the CHL senior debt securities.
The CHL senior indenture also contains provisions permitting
Countrywide Home Loans, the Guarantor and the CHL senior trustee, without the
consent of any holders of CHL senior debt securities, to enter into supplemental
indentures for any of the following purposes:
(1) to evidence the succession of another corporation to
Countrywide Home Loans or the Guarantor and the assumption by
that successor of the obligations and covenants of Countrywide
Home Loans or the Guarantor contained in the CHL senior
indenture, the CHL senior debt securities and the related
Guarantees;
(2) to add to the covenants of Countrywide Home Loans or the
Guarantor for the benefit of the holders of all or any series
of CHL senior debt securities (and if those covenants are to
be for the benefit of less than all series of CHL senior debt
securities, stating that those covenants are expressly being
included solely for the benefit of that series), or to
surrender any right or power in the CHL senior indenture
conferred upon Countrywide Home Loans or the Guarantor;
(3) to add any additional Events of Default (and if those Events
of Default will be applied to less than all series of CHL
senior debt securities, stating that those Events of Default
are expressly being included solely to be applied to that
series);
(4) to add or change any of the provisions of the CHL senior
indenture to the extent necessary to permit or facilitate the
issuance of CHL senior debt securities in bearer form,
registrable or not registrable as to principal, and with or
without interest coupons;
(5) to change or eliminate any provisions of the CHL senior
indenture, provided that any of those changes or eliminations
will become effective only when there is no CHL senior debt
security outstanding of any series created before that
supplemental indenture is executed which is entitled to the
benefit of that provision;
(6) to establish the form or terms of CHL senior debt securities
of any series as otherwise
permitted by the CHL senior indenture;
(7) to evidence and provide for the acceptance of appointment
under the CHL senior indenture by a successor CHL senior
trustee for the CHL senior debt securities of one or more
series issued under the CHL Indenture and to add to or change
any of the provisions of the CHL senior indenture necessary to
provide for or facilitate the administration of the trusts
under the CHL senior indenture by more than one CHL senior
trustee consistent with the requirements of the CHL senior
indenture;
(8) to secure the CHL senior debt securities issued under the CHL
senior indenture;
(9) to cure any ambiguity, to correct or supplement any provision
in the CHL senior indenture which may be defective or
inconsistent with any other provision of the CHL senior
indenture, or to make any other provisions regarding matters
or questions arising under the CHL senior indenture which will
not be inconsistent with any provision of the CHL senior
indenture, provided those other provisions will not adversely
affect the interests of the holders of CHL senior debt
securities of any series issued under the CHL senior indenture
in any material respect;
(10) to modify, eliminate or add to the provisions of the CHL
senior indenture to the extent necessary to qualify the CHL
senior indenture under the Trust Indenture Act or under any
similar federal statute subsequently enacted and to add to the
CHL senior indenture other provisions as may be expressly
required under the Trust Indenture Act; or
(11) to enable the Guarantor or one of its subsidiaries to assume
the payment obligations under the CHL senior debt securities
and the performance of every covenant to be performed or
observed by Countrywide Home Loans under the CHL senior
indenture.
The holders of a majority in aggregate principal amount of the
outstanding CHL senior debt securities of each series may, on behalf of all
holders of CHL senior debt securities of that series, waive any past default
under the CHL senior indenture affecting the CHL senior debt securities of that
series except a default in the payment of the principal of (or any premium), or
interest on, any CHL senior debt security of that series and a default in the
compliance of a covenant or provision if the consent of the holder of each
outstanding CHL senior debt security of that series would be required to modify
or amend that covenant or provision.
Consolidation, Merger and Transfer of Assets
Under the CHL senior indenture, neither Countrywide Home Loans nor the
Guarantor may consolidate with or merge into any corporation, or transfer its
assets substantially as an entirety to any person, unless:
(1) the successor corporation or transferee assumes Countrywide
Home Loans' or the Guarantor's obligations on the CHL senior
debt securities or the related Guarantees, as applicable, and
under the CHL senior indenture, and in the case of a
consolidation or merger of Countrywide Home Loans, the
Guarantor delivers an affirmation of the continuance of its
obligations to the CHL senior trustee;
(2) after giving effect to the transaction, no Event of Default
and no event that, after notice or lapse of time or both,
would become an Event of Default will have occurred and be
continuing; and
(3) some other conditions are met.
Satisfaction, Discharge and Defeasance
The CHL senior indenture, with respect to any series of CHL senior debt
securities (except for some specified surviving obligations, including (1) any
rights of registration of transfer and exchange and (2) rights to receive the
principal, any premium and interest on the CHL senior debt securities), will be
discharged and cancelled upon the satisfaction of certain conditions, including
the following:
(1) all CHL senior debt securities of that series not previously
delivered to the CHL senior trustee for cancellation have
become due or payable, will become due and payable at their
Stated Maturity within one year, or are to be called for
redemption within one year; and
(2) the deposit with the CHL senior trustee of an amount in the
Specified Currency sufficient to pay the principal, any
premium and interest to the Maturity of all CHL senior debt
securities of that series.
If Countrywide Home Loans so specifies in the prospectus supplement
relating to CHL senior debt securities of any series, Countrywide Home Loans at
its option:
(1) will be discharged from any and all obligations under the CHL
senior debt securities of that series (except for obligations
to register the transfer or exchange of CHL senior debt
securities of that series, replace stolen, lost or mutilated
CHL senior debt securities of that series, maintain offices or
agencies in each Place of Payment and hold moneys for payment
in trust); or
(2) will not be subject to provisions of the CHL Indenture
described above under "--Consolidation, Merger and Transfer of
Assets" for the debt securities of that series,
if Countrywide Home Loans irrevocably deposits with the CHL senior trustee, in
trust, money or U.S. government obligations, which through interest and
principal payments will provide a sufficient amount of money (in the opinion of
independent public accountants) to pay all the principal (including any
mandatory sinking fund payments) of, and any premium and interest on, the CHL
senior debt securities of that series on the dates those payments are due
consistent with the terms of those CHL senior debt securities. To exercise
either option, Countrywide Home Loans must deliver to the CHL senior trustee:
(1) an opinion of counsel stating that;
(a) the deposit and related defeasance would not cause
the holders of the CHL senior debt securities of that
series to recognize income, gain or loss for federal
income tax purposes;
(b) the exercise of that option will not cause any
violation of the Investment Company Act
of 1940; and
(c) if the CHL senior debt securities of that series are
then listed on the New York Stock Exchange, those CHL
senior debt securities would not be delisted as a
result of the exercise of that option; and
(2) if CHL senior debt securities of that series are being
discharged, a ruling received from or published by the United
States Internal Revenue Service to the effect that the deposit
and related defeasance would not cause the holders of the CHL
senior debt securities of that series to recognize income,
gain or loss for federal income tax purposes.
Guarantees
The Guarantor will unconditionally guarantee (the "Guarantees") the
payment of principal of and any premium and interest on the CHL senior debt
securities when due and payable, whether at their Stated Maturity or upon
redemption, repayment or otherwise. The Guarantees will rank equally in right of
payment with all other unsecured and unsubordinated obligations of the
Guarantor, including any debt securities issued by the Guarantor under this
prospectus.
The obligations of the Guarantor under the Guarantees will be
unconditional regardless of the enforceability of the CHL senior debt securities
or the CHL senior indenture and will not be discharged until all obligations
under those CHL senior debt securities and the CHL senior indenture are
satisfied. Holders of the CHL senior debt securities may proceed directly
against the Guarantor if an Event of Default affecting those CHL senior debt
securities occurs without first proceeding against Countrywide Home Loans.
Because the Guarantor is a holding company, the rights of its creditors
(including the holders of the CHL senior debt securities if the Guarantees are
enforced) to share in the distribution of the assets of any subsidiary upon that
subsidiary's liquidation or recapitalization will be subject to the prior claims
of the subsidiary's creditors, except to the extent the Guarantor may itself be
a creditor with recognized claims against the subsidiary.
Global Securities
Countrywide Home Loans may issue CHL senior debt securities of any
series in whole or in part in the form of one or more global securities that
will be deposited with, or on behalf of, a depositary identified in the
prospectus supplement relating to that series. Global securities may be issued
in either registered or bearer form and in either temporary or permanent form.
Unless and until it is exchanged in whole or in part for individual certificates
evidencing CHL senior debt securities in definitive form, a global security may
not be transferred except as a whole by the depositary for that global security
to a nominee of that depositary or by a nominee of that depositary to that
depositary or another nominee of that depositary or by that depositary or that
nominee to a successor of that depositary or a nominee of that successor.
Countrywide Home Loans will describe the specific terms of the depositary
arrangement for a series of CHL senior debt securities in the prospectus
supplement relating to that series.
Concerning the Trustee
The Bank of New York is the trustee under the CHL senior indenture.
Countrywide Home Loans and the Guarantor maintain banking relationships in the
ordinary course of business with the CHL senior trustee. Among other things, The
Bank of New York is a lending bank under an existing revolving credit facility
of Countrywide Home Loans.
Governing Law
Unless Countrywide Home Loans otherwise specifies in the applicable
prospectus supplement, the CHL senior indenture and the CHL senior debt
securities will be governed by New York law.
Subordinated Indenture
General
The CHL subordinated indenture will not limit the amount of additional
indebtedness that Countrywide Home Loans or any of its subsidiaries may incur,
except as Countrywide Home Loans may provide in the applicable prospectus
supplement. The CHL debt securities issued under the CHL subordinated indenture
will be subordinated obligations as described in the applicable prospectus
supplement.
Countrywide Home Loans will indicate in the applicable prospectus
supplement the following terms of and information concerning any CHL
subordinated debt securities that Countrywide Home Loans issues (to the extent
those terms apply to those CHL subordinated debt securities and have not been
otherwise described):
(1) the specific title, aggregate principal amount, denomination
and form;
(2) the date of maturity (or the method by which that date may be
determined or extended);
(3) any interest rate or rates, whether fixed or floating (or the
method by which that rate or
those rates will be determined);
(4) the date from which interest will accrue (or the method by
which that date may be determined or reset), the dates on
which that interest will be payable and the record date for
any interest payable on the interest payment date and the
basis upon which interest will be calculated if other than
that of a 360-day year of twelve 30-day months;
(5) the place or places where the principal of and any premium and
any interest on the CHL subordinated debt securities will be
payable, or where those CHL subordinated debt securities may
be surrendered for registration of transfer or exchange, if
not the corporate trust office of the CHL subordinated trustee
for those CHL subordinated debt securities;
(6) the portion of the principal amount of CHL subordinated debt
securities of the series payable upon certain declarations of
acceleration or the method by which that portion shall be
determined;
(7) the denominations and the currency, currencies, currency units
or composite currencies in which
the CHL subordinated debt securities will be issuable;
(8) the currency, currencies, currency units or composite
currencies in which payments on the CHL
subordinated debt securities will be made, if not U.S.dollars;
(9) additional or different subordination terms of the CHL
subordinated debt securities;
(10) any redemption, repayment or sinking fund provisions,
including the period or periods within which, the currency,
currencies, currency units or composite currencies in which
and the other terms and conditions upon which Countrywide Home
Loans may redeem the CHL subordinated debt securities;
(11) the ability of a holder of a CHL subordinated debt security to
renew all or any portion of a
CHL subordinated debt security;
(12) whether the CHL subordinated debt securities are convertible
into or exchangeable for other securities of Countrywide Home
Loans and the terms of the security into which they are
convertible or exchangeable, the conversion price or exchange
ratio, other terms related to conversion and exchange and any
anti-dilution protections;
(13) whether the CHL subordinated debt securities will be sold as
part of units consisting of CHL subordinated debt securities
and securities that Countrywide Credit Industries may offer
under this prospectus;
(14) if the amount of payments of principal of or any premium or
interest on any CHL subordinated debt securities of the series
may be determined by reference to an index, formula or other
method, the index, formula or other method by which those
amounts will be determined;
(15) whether and by what method the CHL subordinated debt
securities of the series (or certain covenants under the
related CHL subordinated indenture) may be defeased and
discharged by Countrywide Home Loans;
(16) whether the CHL subordinated debt securities of the series
shall be issued in whole or in part
as book-entry securities;
(17) any applicable material federal income tax consequences; and
(18) any other material specific terms of the CHL subordinated debt
securities, including any material additional events of
default or covenants provided for and any material terms that
may be required by or advisable under applicable laws or
regulations.
Unless Countrywide Home Loans otherwise indicates in the applicable
prospectus supplement, Countrywide Home Loans will issue CHL subordinated debt
securities only in fully registered form without coupons. The CHL subordinated
debt securities denominated in U.S. dollars will be issued in denominations of
$1,000 or integral multiples of $1,000 unless Countrywide Home Loans otherwise
provides in the applicable prospectus supplement. The prospectus supplement
relating to a series of CHL subordinated debt securities denominated in a
foreign currency or currency unit will specify the denominations in which those
CHL subordinated debt securities may be issued.
The CHL subordinated indenture does not contain any provisions that
would limit Countrywide Home Loans' ability or the ability of any of its
affiliates to incur indebtedness (secured or unsecured) or that would afford
holders of the CHL subordinated debt securities protection in the event of a
highly leveraged transaction, restructuring, change in control, merger or
similar transaction involving Countrywide Home Loans that may adversely affect
holders of the CHL subordinated debt securities.
Unless Countrywide Home Loans otherwise indicates in the applicable
prospectus supplement, the principal of, and any premium or interest on, any
series of CHL subordinated debt securities will be payable, and those CHL
subordinated debt securities will be exchangeable and transfers of them will be
registerable, at the corporate trust office of the CHL subordinated trustee,
initially at 101 Barclay Street, New York, New York 10286. However, Countrywide
Home Loans may elect to make interest payments by check mailed to the address of
the person entitled to them as that address appears in the security register for
those CHL subordinated debt securities.
None of the CHL subordinated debt securities will be entitled to any
benefit under the CHL subordinated indenture or be valid or obligatory for any
purpose unless there appears on the CHL subordinated debt security a certificate
of authentication substantially in the form provided in that CHL subordinated
indenture that is duly executed by the trustee, and that certificate will be
conclusive evidence and the only evidence that the CHL subordinated debt
security has been duly authenticated and delivered under and is entitled to the
benefits of the CHL subordinated indenture.
Subordination of Subordinated Debt Securities
Countrywide Home Loans' obligations under the CHL subordinated debt
securities will be subordinate in right of payment to all present and future
senior indebtedness of Countrywide Home Loans to the extent provided in the CHL
subordinated indenture. Upon any payment or distribution of assets to creditors
upon any liquidation, dissolution, winding up, reorganization, assignment for
the benefit of creditors, marshaling of assets or any bankruptcy, insolvency,
debt restructuring or similar proceedings in connection with the insolvency or
bankruptcy of Countrywide Home Loans, the holders of senior indebtedness of
Countrywide Home Loans will first be entitled to receive payment in full of
senior indebtedness before the holders of the CHL subordinated debt securities
will be entitled to receive or retain any payment.
No payments on account of principal of or any premium or interest on
the CHL subordinated debt securities (including payments on exercise of CHL
subordinated debt security put options) may be made if a default in any payment
on senior indebtedness has occurred and is continuing, or an event of default on
any senior indebtedness resulting in the acceleration of its maturity has
occurred, or if any judicial proceeding is pending with respect to any such
default.
In the event the maturity of the CHL subordinated debt securities is
accelerated, the holders of all senior indebtedness of Countrywide Home Loans
outstanding at the time of the acceleration will first be entitled to receive
payment in full of all amounts due in respect of that senior indebtedness before
the holders of the CHL subordinated debt securities will be entitled to receive
or retain any payment related to the CHL subordinated debt securities.
Amounts that would be due and payable by Countrywide Home Loans to
holders of units in the absence of the foregoing subordination provisions,
however, may be applied by those holders to offset their obligations under their
respective purchase contracts.
Any subordinated CHL subordinated debt securities will be subordinate
and junior in right of payment, to the extent and in the manner described in the
CHL subordinated indenture, to all "senior indebtedness" of Countrywide Home
Loans. Unless Countrywide Home Loans otherwise indicates in the prospectus
supplement, "senior indebtedness" means:
(1) the principal, premium, if any, and interest in respect of
indebtedness for money borrowed and indebtedness evidenced by
securities, debentures, bonds or other similar instruments;
(2) all capital lease obligations;
(3) all obligations issued or assumed as the deferred purchase
price of property, all conditional sale obligations and all
obligations under any title retention agreement, excluding
trade accounts payable arising in the ordinary course of
business;
(4) all obligations for the reimbursement on any letter of credit,
any banker's acceptance, any security purchase facility, any
repurchase agreement or similar arrangement, any interest rate
swap, any other hedging arrangement, any obligation under
options or any similar credit or other transaction;
(5) all obligations of the type referred to in clauses (1) through
(4) above of others, the payment of which Countrywide Home
Loans is responsible or liable as obligor, guarantor or
otherwise; and
(6) all obligations of the type referred to in clauses (1) through
(5) above of others secured by any lien on any of the
properties or assets of Countrywide Home Loans, whether or not
the obligation is assumed by Countrywide Home Loans,
except for:
(a) any indebtedness that states, or is issued under a
deed, indenture or other instrument that states, that
it is subordinate to or ranks equally with the CHL
subordinated debt securities;
(b) any indebtedness between or among Countrywide Home Loans and any of its
affiliates;
(c) the indebtedness represented by the 8% Junior Subordinated Deferrable
Interest Debentures due December
15, 2026 of Countrywide Home Loans; and
(d) the indebtedness represented by the 8.05% Junior Subordinated
Debentures due June 15, 2027 of
Countrywide Home Loans.
Redemption
If and to the extent Countrywide Home Loans provides in the applicable
prospectus supplement, Countrywide Home Loans will have the right to redeem the
CHL subordinated debt securities, in whole or from time to time in part, after
the date and at the redemption prices set forth in the applicable prospectus
supplement.
Events of Default
The CHL subordinated indenture defines an event of default for the CHL
subordinated debt securities of any series as:
(1) failure to pay principal (or premium) on any CHL subordinated
debt security of that series at
maturity;
(2) failure to pay interest on any CHL subordinated debt security
of that series within 30 days of
the date when due;
(3) failure to deposit any sinking fund payment when due for that
series within 30 days of the date
when due;
(4) failure to perform for 90 days after notice any of the other
covenants in the CHL subordinated
indenture;
(5) certain events of bankruptcy, insolvency or reorganization;
(6) failure to pay the put price when due upon exercise of a CHL
subordinated debt security put
option;
(7) default resulting in the acceleration of maturity of any other
indebtedness for money borrowed by Countrywide Home Loans or
by any direct or indirect subsidiary of Countrywide Home Loans
in an amount exceeding $10,000,000 and that acceleration not
being rescinded or annulled for a period of 10 days after
written notice of the default by the trustee or the holders of
at least 25% in aggregate principal amount of the then
outstanding CHL subordinated debt securities of that series;
and
(8) any other event of default provided for CHL subordinated debt
securities of that series.
The CHL subordinated indenture provides that if any event of default
affecting outstanding CHL subordinated debt securities of any series occurs and
is continuing, either the CHL subordinated trustee or the holders of at least
25% in principal amount of the outstanding CHL subordinated debt securities of
that series may declare the principal amount (or, if the CHL subordinated debt
securities of that series are original issue discount securities or indexed
securities, the portion of the principal amount of those CHL subordinated debt
securities as specified by their terms) of all CHL subordinated debt securities
of that series to be due and payable immediately. However, under certain
circumstances the holders of a majority in principal amount of the outstanding
CHL subordinated debt securities of that series on behalf of the holders of all
CHL subordinated debt securities of that series may annul a declaration and
waive past defaults (except, unless previously cured, a default in payment of
principal of or any premium or any interest on the CHL subordinated debt
securities of that series and other specified defaults).
Countrywide Home Loans refers you to the prospectus supplement relating
to each series of CHL subordinated debt securities that are original issue
discount securities for the particular provisions regarding acceleration of the
maturity of a portion of the principal amount of those original issue discount
securities if an event of default occurs and continues.
The agreements governing the outstanding indebtedness of Countrywide
Home Loans contain provisions that would characterize some events of default
under the CHL subordinated indenture as "events of default" under those
agreements that could in turn result in, among other things, an acceleration of
indebtedness under those agreements.
The CHL subordinated indenture contains a provision entitling the CHL
subordinated trustee, subject to its duty to act with the required standard of
care during a default under any series of CHL subordinated debt securities, to
be indemnified by the holders of CHL subordinated debt securities of that series
before exercising any right or power under the CHL subordinated indenture at the
request of the holders of the CHL subordinated debt securities of that series.
The CHL subordinated indenture provides that no holder of CHL
subordinated debt securities of any series may institute proceedings, judicial
or otherwise, to enforce the CHL subordinated indenture except if the CHL
subordinated trustee fails to act for 60 days after it receives a written
request to enforce the CHL subordinated indenture by the holders of at least 25%
in aggregate principal amount of the then outstanding CHL subordinated debt
securities of that series and an offer of reasonable indemnity. This provision
will not prevent any holder of CHL subordinated debt securities from enforcing
payment of the principal of and any premium and interest on those CHL
subordinated debt securities when due. The holders of a majority in aggregate
principal amount of the CHL subordinated debt securities of any series
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the trustee or exercising any trust or power
conferred on it with respect to those CHL subordinated debt securities. However,
the CHL subordinated trustee may refuse to follow any direction that it
determines would be illegal or would conflict with the CHL subordinated
indenture or involve it in personal liability or which would unjustly prejudice
holders of the CHL subordinated debt securities of that series not joining the
proceeding.
The CHL subordinated indenture provides that the trustee will, within
90 days after a default occurs that affects the outstanding CHL subordinated
debt securities of any series, give to the holders of those CHL subordinated
debt securities notice of that default, unless that default has been cured or
waived. Except in the case of a default in the payment of principal of, or any
premium or interest on, any CHL subordinated debt securities or payment of any
sinking fund installment, the CHL subordinated trustee will be protected in
withholding of that notice if it determines in good faith that the withholding
of that notice is in the interest of the holders of the CHL subordinated debt
securities of that series.
Countrywide Home Loans will be required to file with the CHL
subordinated trustee annually an officers' certificate as to the absence of
certain defaults under the terms of the CHL subordinated indenture.
Defeasance of Debt Securities or Some Covenants
Defeasance and Discharge. Unless Countrywide Home Loans otherwise
indicates in the applicable prospectus supplement, the CHL subordinated debt
securities of any series will provide that Countrywide Home Loans will be
discharged from all obligations under the CHL subordinated debt securities of
that series (except for obligations to register the transfer or exchange of CHL
subordinated debt securities of that series, to replace stolen, lost or
mutilated CHL subordinated debt securities of that series, to maintain paying
agencies and to hold moneys for payment in trust) once Countrywide Home Loans
deposits with the CHL subordinated trustee, in trust, money and/or U.S.
government obligations, which through the payment of interest and principal,
will provide a sufficient amount of money to pay and discharge the principal of
(and any premium) and any interest on, and any mandatory sinking fund payments
that apply to, the CHL subordinated debt securities of that series on the stated
maturity of those payments. This discharge may occur only if, among other
things, Countrywide Home Loans delivers to the CHL subordinated trustee an
opinion of counsel stating that Countrywide Home Loans has received from, or
there has been published by, the IRS a ruling, or there has been a change in tax
law, that would cause the discharge not to be deemed, or result in, a taxable
event for the holders of the CHL subordinated debt securities of that series.
Defeasance of Some Covenants. Unless Countrywide Home Loans otherwise
provides in the applicable prospectus supplement, the CHL subordinated debt
securities of any series will permit Countrywide Home Loans not to comply with
some restrictive covenants, including those relating to consolidation and merger
in the CHL subordinated indenture, if Countrywide Home Loans satisfies certain
conditions. Countrywide Home Loans will be able to defease those covenants if,
among other things:
(1) Countrywide Home Loans deposits with the CHL subordinated
trustee money and/or U.S. government obligations, which,
through the payment of interest and principal, will provide a
sufficient amount of money to pay the principal of (and any
premium) and any interest on, and any mandatory sinking fund
payments applicable to, the CHL subordinated debt securities
of that series on the stated maturity of those payments; and
(2) Countrywide Home Loans delivers to the CHL subordinated
trustee an opinion of counsel stating that the deposit and
related covenant defeasance will not cause the holders of the
CHL subordinated debt securities of that series to recognize
income, gain or loss for federal income tax purposes.
If Countrywide Home Loans elects to defease the covenants of a series
of CHL subordinated debt securities and those CHL subordinated debt securities
are declared due and payable because an event of default has occurred, the
amount of money and/or U.S. government obligations on deposit with the CHL
subordinated trustee will be sufficient to pay amounts due on those CHL
subordinated debt securities at their stated maturity but may not be sufficient
to pay amounts due on those CHL subordinated debt securities at the time of the
acceleration. However, Countrywide Home Loans will remain liable for those
payments.
Countrywide Home Loans will state in the prospectus supplement for any
particular series of CHL subordinated debt securities if any defeasance
provisions will apply to those CHL subordinated debt securities.
Modification of the Indenture and Waiver of Covenants
The CHL subordinated indenture permits Countrywide Home Loans and the
CHL subordinated trustee, with the consent of the holders of at least a majority
in principal amount of outstanding CHL subordinated debt securities of each
series affected, to execute supplemental indentures adding provisions to or
changing or eliminating provisions of the CHL subordinated indenture or
modifying the rights of the holders of outstanding CHL subordinated debt
securities of that series, except that no supplemental CHL subordinated
indenture may, without the consent of the holder of each outstanding CHL
subordinated debt security affected:
(1) change the stated maturity, or reduce the principal amount,
any premium on or the rate of
payment of any interest on, of any CHL subordinated debt
security of any series;
(2) reduce the percentage of outstanding CHL subordinated debt
securities of any series, the consent of the holders of which
is required for any supplemental indenture or for waiver of
compliance with certain provisions of the CHL subordinated
indenture or certain defaults thereunder; or
(3) effect various other changes.
The CHL subordinated indenture also allows Countrywide Home Loans not
to comply with certain covenants in the CHL subordinated indenture upon waiver
by the holders of a majority in principal amount of outstanding CHL subordinated
debt securities of the series affected.
Consolidation, Merger and Sale of Assets
The CHL subordinated indenture allows Countrywide Home Loans, without
the consent of the holders of any of the outstanding CHL subordinated debt
securities, to consolidate with or merge into any other corporation or transfer
or lease Countrywide Home Loans' assets substantially as an entirety to any
person if:
(1) the successor is a corporation organized under the laws of any
domestic jurisdiction;
(2) the successor corporation assumes Countrywide Home Loans'
obligations on the CHL subordinated
debt securities and under the CHL subordinated indenture;
(3) after giving effect to the transaction no event of default,
and no event which, after notice or lapse of time, would
become an event of default, shall have happened and be
continuing; and
(4) certain other conditions are met.
Guarantees
The Guarantor will unconditionally guarantee (the "subordinated
guarantees") the payment of principal of and any premium and interest on the CHL
subordinated debt securities when due and payable, whether at their stated
maturity or upon redemption, repayment or otherwise. The subordinated guarantees
will be subordinated in right of payment to all present and future senior
indebtedness of the Guarantor on terms comparable to the subordination of the
CHL subordinated debt securities.
The obligations of the Guarantor under the subordinated guarantees will
be unconditional regardless of the enforceability of the CHL subordinated debt
securities or the CHL subordinated indenture and will not be discharged until
all obligations under those CHL subordinated debt securities and the CHL
subordinated indenture are satisfied. Holders of the CHL subordinated debt
securities may proceed directly against the Guarantor if an event of default
affecting those CHL subordinated debt securities occurs without first proceeding
against Countrywide Home Loans.
Because the Guarantor is a holding company, the rights of its creditors
(including the holders of the CHL subordinated debt securities if the
subordinated guarantees are enforced) to share in the distribution of the assets
of any subsidiary upon that subsidiary's liquidation or recapitalization will be
subject to the prior claims of the subsidiary's creditors, except to the extent
the Guarantor may itself be a creditor with recognized claims against the
subsidiary.
Global Securities
Countrywide Home Loans may issue CHL subordinated debt securities of
any series in whole or in part in the form of one or more global securities that
will be deposited with, or on behalf of, a depositary identified in the
prospectus supplement relating to that series. Global securities may be issued
in either registered or bearer form and in either temporary or permanent form.
Unless and until it is exchanged in whole or in part for individual certificates
evidencing CHL subordinated debt securities in definitive form, a global
security may not be transferred except as a whole by the depositary for that
global security to a nominee of that depositary or by a nominee of that
depositary to that depositary or another nominee of that depositary or by that
depositary or that nominee to a successor of that depositary or a nominee of
that successor. Countrywide Home Loans will describe the specific terms of the
depositary arrangement for a series of CHL subordinated debt securities in the
prospectus supplement relating to that series.
Concerning the Trustee
The Bank of New York is the trustee under each of the CHL senior
indenture and the CHL subordinated indenture. Countrywide Home Loans maintains
banking relationships in the ordinary course of business with the CHL trustee.
Among other things, The Bank of New York is a lending bank under an existing
revolving credit facility of Countrywide Home Loans.
Governing Law
Unless Countrywide Home Loans otherwise specifies in the applicable
prospectus supplement, the CHL subordinated indenture and the CHL subordinated
debt securities will be governed by New York law.
PLAN OF DISTRIBUTION
We or Countrywide Home Loans may sell securities issuable under this
prospectus to or through one or more underwriters or dealers and also may sell
those securities directly to institutional investors or other purchasers, or
through agents.
We or Countrywide Home Loans may distribute the securities periodically
in one or more transactions at a fixed price or prices, which may be changed, or
at market prices prevailing at the time of sale, at prices related to those
prevailing market prices or at negotiated prices.
In connection with the sale of any securities under this prospectus,
underwriters or agents may receive compensation from us or Countrywide Home
Loans or from purchasers of securities for whom they may act as agents in the
form of discounts, concessions or commissions. Underwriters may sell the
securities to or through dealers, and those dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters and/or
commissions from the purchasers for whom they may act as agents. Underwriters,
dealers and agents that participate in the distribution of the securities may be
deemed to be underwriters, and any discounts or commissions received by them
from us or Countrywide Home Loans and any profit on the resale of those
securities by them may be deemed to be underwriting discounts and commissions
under the Securities Act. Any of those underwriters or agents will be
identified, and any compensation received from us or Countrywide Home Loans will
be described, in the related prospectus supplement.
Under agreements that we and/or Countrywide Home Loans may enter into,
underwriters and agents who participate in the distribution of securities
issuable under this prospectus may be entitled to indemnification by us and/or
Countrywide Home Loans against certain liabilities, including liabilities under
the Securities Act.
If we or Countrywide Home Loans so indicate in the related prospectus
supplement, we or Countrywide Home Loans will authorize underwriters or other
persons acting as our or Countrywide Home Loans' agents to solicit offers by
some institutions to purchase securities from us or Countrywide Home Loans under
contracts providing for payment and delivery on a future date. Institutions with
whom we or Countrywide Home Loans would enter into those contracts include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and others, but in all cases
those institutions must be approved by us or Countrywide Home Loans. The
obligations of any purchaser under a contract will be subject to the condition
that the purchase of the securities will not at the time of delivery be
prohibited under the laws of the jurisdiction to which that purchaser is
subject. The underwriters and those other agents will not have any
responsibility as to the validity or performance of those contracts.
If underwriters or dealers are used in the sale, until the distribution
of the securities is completed, rules of the SEC may limit the ability of
underwriters and some selling group members to bid for and purchase the
securities. As an exception to these rules, underwriters may engage in some
transactions that stabilize the price of the securities. Those transactions
consist of bids or purchases for the purpose of pegging, fixing or maintaining
the price of the securities.
If any underwriters create a short position in the securities in
connection with any offering, that is, if they sell more securities than are set
forth on the cover page of any prospectus supplement accompanying this
prospectus, the underwriters may reduce that short position by purchasing
securities in the open market.
Underwriters may also impose a penalty bid on some selling group
members. This means that if the underwriters purchase securities in the open
market to reduce the underwriters' short position or to stabilize the price of
the securities, they may reclaim the amount of the selling concession from the
selling group members that sold those securities as part of that offering. In
general, purchases of a security for the purpose of stabilization or to reduce a
short position could cause the price of the security to be higher than it might
be in the absence of such purchases. The imposition of a penalty bid may also
affect the price of the securities to the extent that it discourages resales of
the securities.
Some of the underwriters or agents and their associates may engage in
transactions with and perform services for us, Countrywide Home Loans or our or
Countrywide Home Loans' affiliates in the ordinary course of business.
The securities may or may not be listed on a national securities
exchange (other than our common stock, which is listed on the New York Stock
Exchange and the Pacific Stock Exchange). Any shares of our common stock sold
under a prospectus supplement will be listed on the New York Stock Exchange and
the Pacific Stock Exchange, subject to official notice of issuance. Neither we
nor Countrywide Home Loans can assure you that there will be an active trading
market for any of the securities sold under this prospectus.
We or Countrywide Home Loans may designate Countrywide Securities
Corporation to be an underwriter, agent or dealer of one or more series of the
securities issuable under this prospectus. The distribution of securities of any
series will conform to the requirements set forth in the applicable sections of
Rule 2720 of the Conduct Rules of the National Association of Securities
Dealers, Inc.
VALIDITY OF SECURITIES
The validity of the securities issuable under this prospectus will be
passed upon for us and Countrywide Home Loans by Munger, Tolles & Olson LLP, Los
Angeles, California. Brown & Wood LLP, New York, New York will serve as counsel
for any underwriters and agents. Brown & Wood LLP also serves as counsel for
CWMBS, Inc. and CWABS, Inc., each one of our wholly owned subsidiaries, in
connection with offerings of mortgage-backed and asset-backed securities, and
from time to time also serves as our counsel on other matters.
EXPERTS
Our consolidated financial statements incorporated by reference in the
registration statement, of which this prospectus forms a part, have been audited
by Grant Thornton LLP, independent certified public accountants, for the periods
and to the extent indicated in their report thereon, and have been so
incorporated in reliance upon the authority of said firm as experts in
accounting and auditing.
<PAGE>
II-11
II-1
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution*
<TABLE>
<S> <C>
SEC registration fee....... $ 834,000
NASD fee 30,500
Blue sky fees and expenses. 15,000
Legal fees and expenses.... 60,000
Accounting fees and expenses........ 120,000
Printing and engraving expenses..... 60,000
Trustees' fees and expenses......... 20,000
Rating agency fees......... 1,200,000
Miscellaneous 10,500
----------------
Total $ 2 ,350,000
</TABLE>
*Except for the SEC registration fee and the NASD fee, all of the
foregoing expenses have been estimated.
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law provides, in
substance, that Delaware corporations shall have the power, under specified
circumstances, to indemnify their directors, officers, employees and agents in
connection with actions, suits or proceedings brought against them by a third
party or in the right of the corporation, by reason of the fact that they were
or are such directors, officers, employees or agents, against expenses incurred
in any such action, suit or proceeding. The Delaware General Corporation Law
also provides that Delaware corporations may purchase insurance on behalf of any
such director, officer, employee or agent. Sections 722, 723, 725 and 726 of the
New York Business Corporation Law are substantively equivalent to Section 145 of
the Delaware General Corporation Law.
Article SIXTH of the Certificate of Incorporation of Countrywide Credit
Industries provides that Countrywide Credit Industries may indemnify its
directors and officers to the full extent permitted by the laws of the State of
Delaware. Article VIII of Countrywide Credit Industries' Bylaws provides that
Countrywide Credit Industries shall indemnify its directors and officers, and
persons serving as directors and officers of Countrywide Home Loans at the
request of Countrywide Credit Industries, against any threatened, pending or
completed action, suit or proceeding or investigation brought against such
directors and officers by reason of the fact that such persons were such
directors or officers, provided that such persons acted in good faith and in a
manner which they reasonably believed to be in or not opposed to the best
interests of Countrywide Credit Industries; except that in the case of actions
brought by or in the right of Countrywide Credit Industries to procure a
judgment in its favor, no indemnification is permitted in respect to any claim,
issue or matter as to which any such director or officer shall have been
adjudged to be liable to Countrywide Credit Industries unless the court in which
the action was brought determines that such person is entitled to
indemnification. Countrywide Credit Industries' Bylaws further contemplate that
the indemnification provisions permitted thereunder are not exclusive of any
other rights to which such directors and officers are otherwise entitled by
means of Bylaw provisions, agreements, vote of stockholders or disinterested
directors or otherwise. Countrywide Credit Industries has entered into indemnity
agreements with certain of its directors and executive officers (including the
directors and executive officers of Countrywide Home Loans), whereby such
individuals are indemnified by Countrywide Credit Industries up to an aggregate
limit of $5,000,000 for any claims made against such individual based on any
act, omission or breach of duty committed while acting as a director or officer,
except, among other things, cases involving dishonesty or improper personal
benefit. Countrywide Credit Industries also maintains an insurance policy
pursuant to which its directors and officers (including the directors and
executive officers of Countrywide Home Loans) are insured against certain
liabilities which might arise out of their relationship with Countrywide Credit
Industries as directors and officers.
Article SEVENTH of the Certificate of Incorporation provides that a
director of Countrywide Credit Industries shall have no personal liability to
Countrywide Credit Industries or its stockholders for monetary damages for
breach of his fiduciary duty of care as a director to the full extent permitted
by the Delaware General Corporation Law, as it may be amended from time to time.
Item 16. Exhibits
1.1* ---------Form of Underwriting Agreement (for equity securities of
Countrywide Credit Industries)
1.2* -- Form of Underwriting Agreement (for debt securities of Countrywide
Credit Industries)
1.3* -- Form of Underwriting Agreement (for units consisting of stock purchase
contracts and debt securities of Countrywide Credit Industries)
1.4* -- Form of Selling Agency Agreement (for debt securities of Countrywide
Home Loans)
4.1 -- Specimen Certificate of Countrywide Credit Industries' Common Stock
(incorporated by reference to Exhibit 4.2 to Countrywide Credit Industries'
Current Report on Form 8-K dated February 6, 1987)
4.2 -- Certificate of Amendment of Restated Certificate of Incorporation of
Countrywide Credit Industries (incorporated by reference to Exhibit 4.1 to
Countrywide Credit Industries' Quarterly Report on Form 10-Q dated August 31,
1987)
4.3 -- Restated Certificate of Incorporation of Countrywide Credit Industries
(incorporated by reference to Exhibit 4.2 to Countrywide Credit Industries'
Quarterly Report on Form 10-Q dated August 31, 1987)
4.4 -- Bylaws of Countrywide Credit Industries, as amended and restated
(incorporated by reference to Countrywide Credit Industries' Current Report on
Form 8-K dated February 10, 1988)
4.5 -- Rights Agreement, dated as of February 10, 1988, between Countrywide
Credit Industries and Bank of America NT & SA, as Rights Agent (incorporated by
reference to Exhibit 4 to Countrywide Credit Industries' Form 8-A filed on
February 12, 1988)
4.6 -- Amendment No. 1 to Rights Agreement, dated as of March 24, 1992, between
Countrywide Credit Industries and Bank of America NT & SA, as Rights Agent
(incorporated by reference to Exhibit 1 to Countrywide Credit Industries' Form 8
filed on March 27, 1992)
4.7* -- Form of Indenture between Countrywide Credit Industries and The Bank of
New York, as trustee, providing for the issuance of senior debt securities
4.8* -- Form of Indenture between Countrywide Credit Industries and The Bank of
New York, as trustee, providing for the issuance of subordinated debt securities
4.9 -- Indenture, dated as of January 1, 1992, among Countrywide Home Loans,
Countrywide Credit Industries and The Bank of New York, as trustee (incorporated
by reference to Exhibit 4.1 to the Registration Statement on Form S-3 of
Countrywide Home Loans and Countrywide Credit Industries (File Nos. 33-50661 and
33-50661-01) filed on October 19, 1993))
4.10 -- Supplemental Indenture No. 1, dated as of June 15, 1995, to the
Indenture dated as of January 1, 1992, among Countrywide Home Loans, Countrywide
Credit Industries and The Bank of New York, as trustee (incorporated by
reference to Exhibit 4.9 to the Registration Statement on Form S-3 of
Countrywide Home Loans and Countrywide Credit Industries (File Nos. 33-59559 and
33-59559-01))
4.11* -- Form of Indenture among Countrywide Home Loans, Countrywide Credit
Industries and The Bank of New York, as trustee, providing for the issuance of
subordinated debt securities.
4.12* -- Form of Master Unit Agreement, between Countrywide Credit Industries
and The Bank of New York, as agent.
4.13* -- Form of Purchase Contract between Countrywide Credit Industries and
purchase contract agent
4.14* -- Form of Pledge Agreement, among Countrywide Credit Industries,
collateral agent, and purchase contract agent
4.15* -- Form of Fixed Rate Medium-Term Note
4.16* -- Form of Floating Rate Medium-Term Note
5.1 -- Opinion of Munger, Tolles & Olson LLP, counsel to Countrywide Credit
Industries and Countrywide Home Loans, as to the validity of the securities
being offered
12.1 -- Statement regarding computation of ratio of earnings to fixed charges
(incorporated by reference to Exhibit 12.1 to Countrywide Credit Industries'
Annual Report on Form 10-K for the year ended February 29, 2000)
23.1 -- Consent of Grant Thornton LLP
23.2 -- Consent of Munger, Tolles & Olson LLP (included in Exhibit 5.1)
24.1 -- Powers of Attorney for Countrywide Credit Industries and Countrywide
Home Loans relating to subsequent amendments (incorporated by reference to
Exhibit 24 to the Registration Statement on Form-3 of Countrywide Credit
Industries and Countrywide Home Loans (File Nos. 333-82583 and 333-82583-01))
24.2 -- Power of Attorney for Countrywide Home Loans relating to subsequent
amendments
25.1* -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to senior debt securities of Countrywide Credit
Industries (separately bound)
25.2* -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to subordinated debt securities of Countrywide
Credit Industries (separately bound)
25.3 -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to senior debt securities of Countrywide Home
Loans (separately bound)
25.4* -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to subordinated debt securities of Countrywide
Home Loans (separately bound)
--------------
* To be filed as an exhibit to a Current Report on Form 8-K of Countrywide
Credit Industries at such time as an underwritten issuance of such
securities is contemplated.
Item 17. Undertakings
(a) The undersigned Countrywide Credit Industries and Countrywide Home Loans
(the "Registrants") hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this
Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected
in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration
Statement; and
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in this Registration Statement or any material change to such
information in this Registration Statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
above do not apply if the Registration Statement is on Form
S-3 and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrants pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) Each of the undersigned Registrants hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of Countrywide Credit Industries' annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrants pursuant to the foregoing provisions, or otherwise,
the Registrants have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrants of expenses incurred or paid by a director, officer or controlling
person of the Registrants in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrants will, unless in
the opinion of their counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by them is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
(d) The undersigned Registrants hereby undertake that:
(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of
prospectus filed as part of this Registration Statement in
reliance upon Rule 430A and contained in a form of prospectus
filed by the Registrants pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of
this Registration Statement as of the time it was declared
effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that
contains a form of prospectus shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(e) The undersigned Registrants hereby undertake to file an application
for the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act ("Act") in accordance
with the rules and regulations prescribed by the Commission under Section
305(b)(2) of the Act.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Countrywide
Credit Industries, Inc. certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Calabasas, State of California, on the 5th day
of June, 2000.
COUNTRYWIDE CREDIT INDUSTRIES, INC.
By: s/ ANGELO R.---------------------------------------
Mozilo
-----------------------------
Angelo R. Mozilo
Chairman of the Board
of Directors and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ ANGELO R. MOZILO Chairman of the Board of June 5, 2000
--------------------------------------------------
Angelo R. Mozilo Directors, Chief Executive Officer
and President (Principal Executive
Officer); Director
* Managing Director, Finance, June 5, 2000
--------------------------------------------------
Carlos M. Garcia Chief Financial Officer and Chief
Accounting Officer (Principal
Financial and Accounting Officer)
* Director June 5, 2000
--------------------------------------------------
Jeffrey M. Cunningham
* Director June 5, 2000
--------------------------------------------------
Robert J. Donato
* Director June 5, 2000
--------------------------------------------------
Michael E. Dougherty
* Director June 5, 2000
--------------------------------------------------
Ben M. Enis
* Director June 5, 2000
--------------------------------------------------
Edwin Heller
/s/ STANFORD L. KURLAND Senior Managing Director June 5, 2000
--------------------------------------------------
Stanford L. Kurland and Chief Operating Officer;
Director
Director
--------------------------------------------------
Oscar P. Robertson
* Director June 5, 2000
--------------------------------------------------
Harley W. Snyder
--------------------------
* Pursuant to power of attorney dated July 9, 1999.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Countrywide
Home Loans, Inc. certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Calabasas, State of California, on the 5th day
of June, 2000.
COUNTRYWIDE HOME LOANS, INC.
By: /s/ ANGELO R.
----------------------------------------
Mozilo
-----------------------------
Angelo R. Mozilo
Chairman of the Board of Directors
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ ANGELO R. MOZILO Chairman of the Board of June 5, 2000
--------------------------------------------------
Angelo R. Mozilo Directors; Director
/s/ STANFORD L. KURLAND Chief Executive Officer and June 5, 2000
--------------------------------------------------
Stanford L. Kurland President (Principal Executive
Officer); Director
* Managing Director and Chief June 5, 2000
--------------------------------------------------
Thomas K. McLaughlin Financial Officer (Principal Financial and Accounting
Officer)
/s/ CARLOS M. G ARCIA Chief Operating Officer; Director June 5, 2000
--------------------------------------------------
Carlos M. Garcia
/s/ DAVID SAMBOL Managing Director, Capital Markets; June 5, 2000
--------------------------------------------------
David Sambol Director
--------------
* Pursuant to power of attorney dated July 9, 1999.
<PAGE>
EXHIBIT INDEX
1.1* -- Form of Underwriting Agreement (for equity securities of Countrywide
Credit Industries)
1.2* -- Form of Underwriting Agreement (for debt securities of Countrywide
Credit Industries)
1.3* -- Form of Underwriting Agreement (for units consisting of stock purchase
contracts and debt securities of Countrywide Credit Industries)
1.4* -- Form of Selling Agency Agreement (for debt securities of Countrywide
Home Loans)
4.1 -- Specimen Certificate of Countrywide Credit Industries' Common Stock
(incorporated by reference to Exhibit 4.2 to Countrywide Credit Industries'
Current Report on Form 8-K dated February 6, 1987)
4.2 -- Certificate of Amendment of Restated Certificate of Incorporation of
Countrywide Credit Industries (incorporated by reference to Exhibit 4.1 to
Countrywide Credit Industries' Quarterly Report on Form 10-Q dated August 31,
1987)
4.3 -- Restated Certificate of Incorporation of Countrywide Credit Industries
(incorporated by reference to Exhibit 4.2 to Countrywide Credit Industries'
Quarterly Report on Form 10-Q dated August 31, 1987)
4.4 -- Bylaws of Countrywide Credit Industries, as amended and restated
(incorporated by reference to Countrywide Credit Industries' Current Report on
Form 8-K dated February 10, 1988)
4.5 -- Rights Agreement, dated as of February 10, 1988, between Countrywide
Credit Industries and Bank of America NT & SA, as Rights Agent (incorporated by
reference to Exhibit 4 to Countrywide Credit Industries' Form 8-A filed on
February 12, 1988)
4.6 -- Amendment No. 1 to Rights Agreement, dated as of March 24, 1992, between
Countrywide Credit Industries and Bank of America NT & SA, as Rights Agent
(incorporated by reference to Exhibit 1 to Countrywide Credit Industries' Form 8
filed on March 27, 1992)
4.7* -- Form of Indenture between Countrywide Credit Industries and The Bank of
New York, as trustee, providing for the issuance of senior debt securities
4.8* -- Form of Indenture between Countrywide Credit Industries and The Bank of
New York, as trustee, providing for the issuance of subordinated debt securities
4.9 -- Indenture, dated as of January 1, 1992, among Countrywide Home Loans,
Countrywide Credit Industries and The Bank of New York, as trustee (incorporated
by reference to Exhibit 4.1 to the Registration Statement on Form S-3 of
Countrywide Home Loans and Countrywide Credit Industries (File Nos. 33-50661 and
33-50661-01) filed on October 19, 1993))
4.10 -- Supplemental Indenture No. 1, dated as of June 15, 1995, to the
Indenture dated as of January 1, 1992, among Countrywide Home Loans, Countrywide
Credit Industries and The Bank of New York, as trustee (incorporated by
reference to Exhibit 4.9 to the Registration Statement on Form S-3 of
Countrywide Home Loans and Countrywide Credit Industries (File Nos. 33-59559 and
33-59559-01))
4.11* -- Form of Indenture among Countrywide Home Loans, Countrywide Credit
Industries and The Bank of New York, as trustee, providing for the issuance of
subordinated debt securities.
4.12* -- Form of Master Unit Agreement, between Countrywide Credit Industries
and The Bank of New York, as agent.
4.13* -- Form of Purchase Contract between Countrywide Credit Industries and
purchase contract agent
4.14* -- Form of Pledge Agreement, among Countrywide Credit Industries,
collateral agent, and purchase contract agent
4.15* -- Form of Fixed Rate Medium-Term Note
4.16* -- Form of Floating Rate Medium-Term Note
5.1 -- Opinion of Munger, Tolles & Olson LLP, counsel to Countrywide Credit
Industries and Countrywide Home Loans, as to the validity of the securities
being offered
12.1 -- Statement regarding computation of ratio of earnings to fixed charges
(incorporated by reference to Exhibit 12.1 to Countrywide Credit Industries'
Annual Report on Form 10-K for the year ended February 29, 2000)
23.1 -- Consent of Grant Thornton LLP
23.2 -- Consent of Munger, Tolles & Olson LLP (included in Exhibit 5.1)
24.1 -- Powers of Attorney for Countrywide Credit Industries and Countrywide
Home Loans relating to subsequent amendments (incorporated by reference to
Exhibit 24 to the Registration Statement on Form-3 of Countrywide Credit
Industries and Countrywide Home Loans (File Nos. 333-82583 and 333-82583-01))
24.2 -- Power of Attorney for Countrywide Home Loans relating to subsequent
amendments
25.1* -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to senior debt securities of Countrywide Credit
Industries (separately bound)
25.2* -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to subordinated debt securities of Countrywide
Credit Industries (separately bound)
25.3 -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to senior debt securities of Countrywide Home
Loans (separately bound)
25.4* -- Form T-1 Statement of Eligibility Under Trust Indenture Act of 1939 of
The Bank of New York relating to subordinated debt securities of Countrywide
Home Loans (separately bound)
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* To be filed as an exhibit to a Current Report on Form 8-K of Countrywide
Credit Industries at such time as an underwritten issuance of such
securities is contemplated.
