**Exhibit 4.42**

[Form of Security]

COUNTRYWIDE HOME LOANS, INC.

8.05 % Junior Subordinated Debentures due

June 15, 2027, Series B

$                              

Certificate No.             

This Security may not be acquired by any Person who is, or who in acquiringthis Security is using the assets of, an ERISA Plan unless this Security isacquired pursuant to and in accordance with an applicable exemption, includingbut not limited to:  (i) ProhibitedTransaction Class Exemption 90-1 (“PTE 90-1”), regarding investments by insurance company pooled separate accounts,(ii) Prohibited Transaction Class Exemption 91-38 (“PTE 91-38”), regardinginvestments by bank collective investment funds, (iii) Prohibited TransactionClass Exemption 84-14 (“PTE 84-14”), regarding transactions effected byqualified professional asset managers, (iv) Prohibited Transaction ClassExemption 96-23 (“PTE 96-23”) regarding transactions effected by in-house assetmanagers, or (v) Prohibited Transaction Class Exemption 95-60 (“PTE 95-60”),regarding investments by insurance company general accounts.  The acquisition of this Security by anyperson who is, or who in acquiring this Security is using the assets of, anERISA Plan shall be deemed to constitute a representation by such Person to theTrust that (i) such Person is eligible for exemptive relief available pursuantto an applicable exemption, including but not limited to, PTE 90-1, PTE 91-38,PTE 84-14, PTE 96-23 or PTE 95-60 with respect to the acquisition and holdingof this Security, and (ii) none of Countrywide Home Loans, Inc., CountrywideCredit Industries, Inc., Countrywide Financial Services, Inc. or CountrywideSecurities Corporation is a “fiduciary”, within the meaning of Section 3(21) ofERISA and the regulations thereunder, with respect to such Person’s interest inthis Security.

COUNTYWIDE HOME LOANS, INC., a corporation duly organized and existingunder the laws of the State of New York (herein called the “Company”, whichterm includes any successor corporation under the Indenture hereinafterreferred to), for value received, hereby promises to pay              ,or registered assigns, the principal sum of                  ($                  )on June 15, 2027 (the “Stated Maturity”; unless a Maturity Advancement (as hereinafterdefined) occurs as a result of a Tax Event, in which case the Stated Maturityshall be such advanced maturity date), and to pay interest on said principalfrom                 ,199 or from the most recent interest payment date to which interest on thisSecurity (or the 8.05% Junior Subordinated Debentures due June 15, 1987, SeriesA, in exchange for which this Security was issued) has been paid or dulyprovided for, semi-annually (subject to deferral as set forth herein) inarrears on June 15 and December 15 of each year (each, an “Interest PaymentDate”), commencing December 15, 1997, at a rate of 8.05% per annum until theprincipal hereof shall have been paid or made available for payment, and on anyoverdue principal and (without duplication and to the extent that payment ofsuch interest is enforceable under applicable law) on any overdue installmentof interest at the same rate per annum compounded semi-annually.  In the event that a Registration Default (asdefined in the Registration Rights Agreement) occurs, additional interest (“AdditionalInterest”) shall become payable in respect of this Security with respect to thefirst 90-day period immediately following the occurrence of such RegistrationDefault, in an amount equal to $.05 per week per $1,000 liquidation amount ofthis Security for each week or portion thereof that the Registration Defaultcontinues, as provided in the Registration Rights Agreement.  Additional Interest will increase by anadditional $.05 per week per $1,000 liquidation amount of this Security withrespect to each subsequent 90-day period until all Registration Defaults havebeen cured, up to a maximum amount of Additional Interest of $.25 per week 

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per$1,000 liquidation amount of this Security. The amount of interest payable forany semi-annual interest period will be computed for any full 180-daysemi-annual interest payment period, on the basis of a 360-day year of twelve30-day months.  The amount of interestpayable for any period shorter than a full 180-day semi-annual interest paymentperiod for which interest payments are computed, will be computed on the basisof actual number of days elapsed in such 180-day period (assuming each fullmonth elapsed in such period consists of 30 days).  In the event that any date on which interestis payable on this Security is not a Business Day (as hereinafter defined),then a payment of the interest payable on such date will be made on the nextsucceeding day which is a Business Day (and without any additional interest orother payment in respect of any such delay), except that, if such Business Dayis in the next succeeding calendar year, such payment shall be made on theimmediately preceding Business Day, in each case with the same force and effectas if made on the date such payment was originally payable; provided that nointerest shall accrue for the period from and after the date such payment wasoriginally payable.  A “Business Day”shall mean any day other than a Saturday or a Sunday, or a day on which bankinginstitutions in The City of New York or Los Angeles, California are authorizedor required by law or executive order to remain closed or a day on which theCorporate Trust Office of the Trustee, or the principal corporate trust officeof the Property Trustee under the Declaration, is closed for business.  The interest installment so payable, andpunctually paid or duly provided for, on any Interest Payment Date will, asprovided in the Indenture, be paid to the Person in whose name the Securities(or one or more Predecessor Securities, as defined in the Indenture) isregistered at the close of business on the Regular Record Date for suchinterest installment, which shall be determined as provided in theIndenture.  Any such interest installmentnot so punctually paid or duly provided for shall forthwith cease to be payableto the Holder on such Regular Record Date and may either be paid to the Personin whose name the Securities or one or more Predecessor Securities isregistered at the close of business on a Special Record Date for the payment ofsuch Defaulted Interest to be fixed by the Trustee, notice whereof shall begiven to Holders of Securities not less than 10 days prior to such SpecialRecord Date, or be paid at any time in any other lawful manner not inconsistentwith the requirements of any securities exchange on which the Securities may belisted, and upon such notice as may be required by such exchange, all as morefully provided in said Indenture.

So long as no Event of Default has occurred and is continuing, theCompany shall have the right at any time during the term of this Security, fromtime to time, to defer payment of interest on such Security for a period not toexceed 10 semi-annual periods, (an “Extension period”), provided, that noExtension Period may extend past the Stated Maturity of this Security.  There may be multiple Extension Periods ofvarying lengths during the term of this Security.  At the end of any Extension Period, if any,the Company shall pay all interest then accrued and unpaid, together withinterest thereon, compounded semi-annually at the rate specified on thisSecurity to the extent permitted by applicable law.  During any such Extension Period, the Companyand the Guarantor shall not, declare or pay any dividends on, or make adistribution with respect to, or redeem, purchase or acquire, or make aliquidation payment with respect to, any of its capital stock or rights toacquire such capital stock (other than (i) purchases or acquisitions of sharesof any such capital stock or rights to acquire such capital stock in connectionwith the satisfaction by the Company or the Guarantor, respectively, of itsobligations under any employee benefit plans, (ii) as a result of areclassification of the Company’s or the Guarantor’s capital stock or rights toacquire such capital stock or the exchange or conversion of one class or seriesof the Company’s or the Guarantor’s capital stock or rights to acquire suchcapital stock for another class or series of the Company’s or the Guarantor’s capitalstock or rights to acquire such capital stock, (iii) the purchase of fractionalinterests in shares of the

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Company’sor the Guarantor’s capital stock pursuant to the conversion or exchangeprovisions of such capital stock or the security being converted or exchangedor (iv) dividends and distributions made on the Company’s or the Guarantor’scapital stock or rights to acquire such capital stock with the Company’s or theGuarantor’s capital stock or rights to acquire such capital stock) or make anyguarantee payments with respect to any of the foregoing and (b) the Company andthe Guarantor shall not make any payment of interest, principal or premium, ifany, on or repay, repurchase or redeem any debt securities (including anyguarantees, other than the Guarantees) issued by the Company or the Guarantorthat rank pari passu with or junior to this Security and the DebtGuarantee.  Prior to the termination ofany such Extension Period, the Company may further extend the Extension Period,provided that no Extension Period may exceed 10 consecutive semi-annual periodsor extend beyond the Stated Maturity of this Security.  Upon the termination of any such ExtensionPeriod and the payment of all amounts then due on any Interest Payment Date,the Company may elect to begin a new Extension Period subject to the aboverequirements.  No interest shall be dueand payable during an Extension Period, except at the end thereof.  The Company shall give the Guarantor, theProperty Trustee, the Regular Trustees and the Trustee written notice of itselection of such Extension Period not less than one Business Day prior to therecord date for the applicable Interest Payment Date.

Payment of the principal of and interest on this Security will be madeat the office or agency of the Paying Agent maintained for that purpose in theUnited States, in such coin or currency of the United States of America as atthe time of payment is legal tender for payment of public and private debts;provided, however, that at the option of the Company, payment of interest maybe made (i) by check mailed to the address of the Person entitled thereto assuch address shall appear in the Security Register or (ii) by wire transfer inimmediately available funds at such place and to such account as may bedesignated by the Person entitled thereto as specified in the SecurityRegister.

The indebtedness evidenced by this Security is, to the extent providedin the Indenture, subordinate and subject in right of payment to the priorpayment in full of all Senior Indebtedness, and this Security is issued subjectto the provisions of the Indenture with respect thereto.  Each Holder of this Security, by acceptingthe same, (a) agrees to and shall be bound by such provisions, (b) authorizesand directs the Trustee on his behalf to take such action as may be necessaryor appropriate to effectuate the subordination so provided and (c) appoints theTrustee his attorney-in-fact for any and all such  purposes. Each Holder hereof, by his acceptance hereof, waives all notice of theacceptance of the subordination provisions contained herein and in theIndenture by each holder of Indebtedness, whether now outstanding or hereafterincurred, and waives reliance by each such holder upon said provisions.

Reference is hereby made to the further provisions of the Indenturesummarized on the reverse hereof, which further provisions shall for allpurposes have the same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed bythe Trustee referred to on the reverse hereof by manual signature, thisSecurity shall not be entitled to any benefit under the Indenture or be validor obligatory for any purpose.

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IN WITNESS WHEREOF, Countrywide Home Loans, Inc. has caused thisinstrument to be duly executed.
|                              |   | COUNTRYWIDE HOME LOANS, INC. |
|------------------------------|--------|------------------------------|
|                         |   |                         |
|                         |   | By                           | : |
|                         |   | Name:                        |
|                         |   | Title:                       |
| Attest:                      |   |                         |
|                         |   |                         |
|                         |   |                         |
| Name:                        |   |                         |
| Title:   Secretary |   |                         |

 

[Form of Reverse of Security]

This Security is one of a duly authorized issue of Securities ofCountrywide Home Loans, Inc. (the “Company”), designated as its 8.05% JuniorSubordinated Debentures due June 15, 2027, Series B (herein called the “Securities”),limited in aggregate principal amount to $206,200,000 issued under anIndenture, dated as of June 4, 1997 (herein called the “Indenture”), among theCompany, Countrywide Credit Industries, Inc. (the “Guarantor” and the Bank ofNew York, a New York banking corporation, as Trustee (herein called the “Trustee,”which term includes any successor trustee under the Indenture), to whichIndenture and all indentures supplemental thereto reference is hereby made fora statement of the respective rights, limitations of rights, duties andimmunities thereunder of the Trustee, the Company, the Guarantor and theHolders of the Securities, and of the terms upon which the Securities are, andare to be, authenticated and delivered.

All terms used in this Security which are defined in the Indentureshall have the meanings assigned to them in the Indenture.

This Security is not redeemable at the option of the Company; providedthat this Security shall be redeemable at the option of the Company at any timein whole (but not in part), within 90 days of the occurrence of a Special Event(as defined in the Indenture), as a Redemption Price equal to 100% of theaggregate principal amount of the Securities to be redeemed, plus accrued andunpaid interest, if any, to the Redemption Date.  In addition, if a Tax Event shall occur and becontinuing and in the opinion of counsel, rendered by a law firm having arecognized national tax practice, there would in all cases, after effecting thedissolution of the Trust and the distribution of the Securities to the Holdersof the Capital Securities and Common Securities in exchange therefore uponliquidation of the Trust, be more than an insubstantial risk that the Tax Eventwould continue to exist, then the Company shall have the right to shorten theStated Maturity of the Securities to a date not earlier than December 15, 2011(a “Maturity Advancement”), such that, in the opinion of counsel to the Trustrendered by a law firm having a recognized national tax practice, afteradvancing the Stated Maturity of the Debt Securities, interest paid on theSecurities will be deductible by the Company for United States federal incometax purposes.

For so long as the Trust is the Holder of all the SecuritiesOutstanding, the proceeds of any redemption described herein shall be used bythe Trust to redeem Common Securities and Capital Securities in accordance withtheir terms.

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If an Event of Default with respect to the Securities shall occur andbe continuing, the principal of the Securities may be declared due and payablein the manner with the effect and subject to the conditions provided in theIndenture.

The Indenture contains provisions for satisfaction and discharge orlegal defeasance of the entire indebtedness of this Security and for thedefeasance of certain covenants under the Indenture at any time upon complianceby the Company with certain conditions set forth in the Indenture.

The Indenture contains provisions permitting the Company, the Guarantorand the Trustee, with the consent of Holders of not less than a majority inprincipal amount of the Outstanding Securities, to modify the Indenture in amanner affecting the rights of the Holders of the Securities; provided that nosuch modification may, without the consent of the Holder of each OutstandingSecurity affected thereby, (i) except to the extent permitted and subject tothe conditions set forth in the Indenture with respect to extension of theinstallments of interest on the Securities or shortening of the Stated Maturityof the Securities, change the Stated Maturity of, the principal of, or anyinstallment of interest on, this Security or reduce the principal amountthereof, or the rate of payment of interest thereon, or change the place ofpayment where, or the coin or currency in which, this Security or interestthereon is payable, or impair the right to institute suit for the enforcementof such payment on or after the Stated Maturity thereof (or, in the case ofredemption, on or after the Redemption Date), or modify the provisions of theIndenture with respect to the subordination of the Securities in a manneradverse to the Holders, (ii) reduce the percentage in principal amount of theOutstanding Securities, the consent of whose Holders is required for suchsupplemental Indenture or the consent of whose Holders is required for anywaiver (of compliance with certain provisions of the Indenture or certaindefaults thereunder and their consequences) provided for in the Indenture, or(iii) modify any of the provisions of Section 7.13, Section 11.2 or Section12.9 of the Indenture, except to increase any such percentage or to providethat certain other provisions of the Indenture cannot be modified or waivedwithout the consent of the Holder of each Outstanding Security affectedthereby, provided that, so long as any of the Capital Securities remainoutstanding, no such amendment shall be made that adversely affects the holdersof the Capital Securities, and no termination of the Indenture shall occur, andno waiver of an Event of Default or compliance with any covenant under theIndenture shall be effective, without the prior consent of the holders of atleast a majority of the aggregate liquidation preferences of the outstandingCapital Securities unless and until the principal of and any premium on theSecurities and all accrued and unpaid interest thereon have been paid in full.

No reference herein to the Indenture and no provision of this Securityor of the Indenture shall alter or impair the obligation of the Company, whichis absolute and unconditional, to pay the principal of and interest on thisSecurity at the times, place and rate, and in the coin or currency, hereinprescribed.

As provided in the Indenture and subject to certain limitations thereinset forth, the transfer of this Security is registerable in the SecurityRegister, upon surrender of this Security for registration of transfer at theoffice or agency of the Company in New York, New York, duly endorsed by, oraccompanied by a written instrument of transfer in form satisfactory to theCompany and the Security Registrar duly executed by, the Holder hereof or his attorneyduly authorized in writing, and thereupon one or more new Securities orauthorized denominations and for the same aggregate principal amount, will beissued to the designated transferee or transferees.  No service charge shall be made for any suchregistration of transfer or exchange, but the

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Companymay require payment of a sum sufficient cover any tax or other governmentalcharge payable in connection therewith.

Prior to due presentment of this Security for registration of transfer,the Company, the Trustee and any agent of the Company or the Trustee may treatthe Person in whose name this Security is registered as the owner hereof forall purposes, whether or not this Security be overdue, and neither the company,the Trustee nor any such agent shall be affected by notice to the contrary.

The Securities are issuable only in registered form without coupons indenominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject tocertain limitations therein set forth, Securities are exchangeable for a likeaggregate principal amount of Securities of different authorized denominations,as requested by the Holder surrendering the same.

THESECURITIES AND THE INDENTURE SHALL BE GOVERNED BY ANDCONSTRUED IN ACCORDANCE WITH THE LAWS OF THESTATE OF NEW YORK WITHOUT REGARDTO CONFLICT OF LAWS PRINCIPLES THEREOF.

This is one of the Securities referred to inthe within-mentioned Indenture.
|        |   | THE BANK OF NEW YORK, |
|--------|--------|-----------------------|
|   |   |                  |
|   |   | as Trustee            |
|   |   |                  |
|   |   | By                    | : |
|   |   | Authorized  Signatory |

Dated:

In connection with any transfer of this Security occurring prior to thedate which is the earlier of (i) the date of the declaration by the Commissionof the effectiveness of a registration statement under the Securities Actcovering resales of this Security (which effectiveness shall not have beensuspended or terminated at the date of the transfer) and (ii) two years afterthe later of the date of original issue and the last date on which the Companyor any affiliate of the Company was the owner of such Securities)(or anypredecessor thereto) (the “Resale Restriction Termination Date”), theundersigned confirms that it has not utilized any general solicitation orgeneral advertising in connection with the transfer:

[CHECK ONE]
| (1)    |   | o      |   | to the Company or a subsidiary thereof; or                                                                                                                   |
|--------|--------|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |   |                                                                                                                                                         |
| (2)    |   | o      |   | pursuant to and in compliance with Rule 144A under  the Securities Act of 1933, as amended; or                                                               |
|   |   |   |   |                                                                                                                                                         |
| (3)    |   | o      |   | outside the United States to a “foreign person” in  compliance with the Rule 904 of Regulation S under the Securities Act of  1933, as amended; or |
|   |   |   |   |                                                                                                                                                         |
| (4)    |   | o      |   | pursuant to the exemption from registration provided  by Rule 144 under the Securities Act of 1933, as amended; or                                           |
|   |   |   |   |                                                                                                                                                         |
| (5)    |   | o      |   | pursuant to an effective  registration statement under the Securities Act of 1933, as amended; or                                                            |
|   |   |   |   |                                                                                                                                                         |
| (6)    |   | o      |   | pursuant to another  available exemption from the registration requirements of the Securities Act  of 1933, as amended.                                      |

 

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Unlessone of the boxes is checked, the Trustees will refuse to register any of theSecurities evidenced by this certificate in the name of any Person other thanthe registered Holder thereof; provided, however, that if box (3), (4) or (6)is checked, the Company or the Trustee may require, prior to registering anysuch transfer of the Securities, in its sole discretion, such written legalopinions, certifications (including an investment letter in the case of box (3)or (4) and other information as the Trustee or the Company has reasonablyrequested to confirm that such transfer is being made pursuant to an exemptionfrom, or in a transaction not subject to, the registration requirements of theSecurities Act of 1933, as amended.

If none of the foregoing boxes is checked, the Trustee or Registrarshall not be obligated to register this Security in the name of any Personother than the Holder hereof unless and until the conditions to any suchtransfer of registration set forth herein and in Section 2.8 of the Indentureshall have been satisfied.
| Dated                 | :      |                                                                        |   | Signed | : |
|-----------------------|--------|-----------------------------------------------------------------------------|--------|--------|---|
|                  |   | (Sign exactly as name  appears on the  other side of this Capital Security) |
| Signature  Guarantee: |   |                                                                        |   |
|                       |        |                                                                             |        |        |   |  |

 

TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED

The undersigned represents and warrants that it is purchasing thisSecurity for its own account or an account with respect to which it exercisessole investment discretion and that it and any such account is a “qualifiedinstitutional buyer” within the meaning of Rule 144A under the Securities Actand is aware that the sale to it is being made in reliance on Rule 144A andacknowledges that it has received such information regarding the Company as theundersigned has requested pursuant to the Rule 144A or has determined not torequest such information and that it is aware that the transferor is relyingupon the undersigned’s foregoing representations in order to claim theexemption from registration provided by Rule 144A.
| Dated  | :      |                                                                                 |   |   |
|--------|--------|--------------------------------------------------------------------------------------|--------|--------|
|   |   | NOTICE:       To  be executed by an  executive officer |

 

TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED

The undersigned represents and warrants that it is purchasing thisSecurity outside the United States as a “foreign person” in compliance withRule 904 of Regulation S under the Securities Act and is aware that the sale toit is being made in reliance on Regulation S.
| Dated  | :      |                                                                                 |   |   |
|--------|--------|--------------------------------------------------------------------------------------|--------|--------|
|   |   | NOTICE:       To  be executed by an  executive officer |

 

 

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FOR VALUE RECEIVED, the Guarantor hereby unconditionally guarantees tothe holder of this Security upon which this Guarantee is endorsed the due andpunctual payment of the principal, premium, if any, and interest on saidSecurity, when and as the same shall become due and payable, whether atmaturity, upon redemption or otherwise, according to the terms thereof and ofthe Indenture referred to therein.

The Guarantor agrees to determine, at least one Business Day prior tothe date upon which a payment of principal of and premium, if any, or intereston said Security is due and payable, whether the Company has available the fundto make such payment as the same shall become due and payable.  In case of the failure of the Companypunctually to pay any such principal, premium, if any, or interest, theGuarantor hereby agrees to cause any such payment to be made punctually when asthe same shall become due and payable, whether at maturity, upon redemption, orotherwise, and as if such payment were made by the Company.

The Guarantor hereby agrees that its obligation hereunder shall beunconditional, irrevocable, and absolute, irrespective of the validity,regularity, or enforceability of said Security or said Indenture, the absenceof any action to enforce the same, any waiver or consent by the Holder of saidSecurity with respect to any provisions thereof, the recovery of any judgmentagainst the Company or any action to enforce the same, or any othercircumstance which might otherwise constitute a legal or equitable discharge ordefense of a guarantor.  The Guarantorhereby waives diligence, presentment, demand of payment, filing of claims witha court in the event of merger or bankruptcy of the Company, any right torequire a proceeding first against the Company, protest or notice with respectto said Security or indebtedness evidenced thereby, and all demands whatsoeverand covenants that this Guarantee will not be discharged except by complete performanceof the obligations contained in said Security and in this Guarantee.

The Guarantor shall be subrogated to all rights of the holder of saidSecurity against the Company in respect of any amounts paid by the Guarantorpursuant to the provisions of this Guarantee; provided, however, that theGuarantor shall not, without the consent of the holders of all the Securitiesthen outstanding, be entitled to enforce or to receive any payments arising outof or based upon such right of subrogation until the principal of and premium,if any, and interest on all Securities shall have been paid in full or paymentthereof shall have been provided for in accordance with said Indenture.

Notwithstanding anything to the contrary contained herein, if followingany payment of principal or interest by the Company on the Securities to theholders of the Securities it is determined by a final decision of a court ofcompetent jurisdiction that such payment shall be avoided by a trustee inbankruptcy (including any debtor-in-possession) as a preference under 11 U.S.C.Section 547 and such payment is paid by such holder of such trustee inbankruptcy, then and to the extent of such repayment, the obligation of theGuarantor hereunder shall remain in full force and effect.

This Guarantee shall not be valid or become obligatory for any purposewith respect to a Security until the certification of authentication on suchSecurity shall have been signed by the Trustee (or the Authentication Agent).

This Guarantee shall be governed by the laws of the State of New Yorkwithout regard to conflict of laws principles thereof.

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IN WITNESS WHEREOF, Countrywide Credit Industries, Inc. has caused thisGuarantee to be signed in its corporate name by the facsimile signature of twoof its officers thereunto duly authorized.
|        |   | COUNTRYWIDE CREDIT INDUSTRIES, INC. |
|--------|--------|-------------------------------------|
|   |   |                                |
|   |   | By                                  | : |   |
|   |   | Name:                               |
|   |   | Title:                              |
|   |   |                                |
|   |   | By                                  | : |   |
|   |   | Name:                               |
|   |   | Title:                              |
|        |        |                                     |  |  |  |  |

 

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