INDEX OF DEFINED TERMS - Banca di Legnano

Level: 2 – From: 2 – Wednesday, July 21, 2010 – 13:20 – eprint6 – 4247 Section 10
demurrers in response to the amended complaint. On April 29, 2010, in the action in New York Supreme
Court, entitled MBIA Insurance Corporation, Inc. v. Countrywide Home Loans, et al., the court issued an
order granting in part and denying in part defendants’ motion to dismiss, declining to dismiss plaintiff’s
claims against the Issuer.
On December 11, 2009, Financial Guaranty Insurance Company (“FGIC”) filed a complaint,
entitled Financial Guaranty Insurance Co., v. Countrywide Home Loans, Inc., in New York Supreme
Court, New York County, against Countrywide Home Loans, Inc. (“CHL”). The action relates to bond
insurance policies provided by FGIC with regard to certain securitized pools of home equity lines of credit
and fixed-rate second lien mortgage loans. FGIC allegedly has paid claims as a result of defaults in the
underlying loans, and claims that these defaults are the result of improper loan underwriting. The
complaint alleges misrepresentation and breach of contract, among other claims, and seeks unspecified
actual and punitive damages, and attorneys’ fees.
On February 26, 2010, CHL filed a motion to dismiss certain claims asserted in Financial Guaranty
Insurance Company v. Countrywide Home Loans, Inc. On April 30, 2010, FGIC filed an amended
complaint, which adds the Issuer, CFC, Countrywide Securities Corporation (“CSC”) and Countrywide
Bank F.S.B. as defendants.
On March 24, 2010, CHL, CSC and CFC filed a separate but related action against FGIC in New
York Supreme Court seeking monetary damages of at least $100 million against FGIC in connection with
FGIC’s failure to pay claims under certain bond insurance policies provided by FGIC.
On March 24, 2010, CHL, CSC, CWHEQ, Inc. and CWABS, Inc. initiated a proceeding in New
York Supreme Court under Article 78 of the New York Civil Practice Law and Rules challenging the
November 24, 2009 order of the New York State Insurance Department, which directed FGIC to cease
payment of claims under certain bond insurance policies. In the Article 78 proceeding, CHL, CSC,
CWHEQ, Inc. and CWABS, Inc. assert that the New York State Insurance Department’s 24 November
2009 order to FGIC to stop paying insurance proceeds was in excess of the Insurance Department’s
powers and violated New York Insurance law and related regulations. The parties are therefore seeking a
declaration that the November 24, 2009 order is void.
Countrywide Equity and Debt Securities Matters
General Information
CFC, certain other Countrywide entities, and certain former officers and directors of CFC, among
others, have been named as defendants in two putative class actions filed in the U.S. District Court for the
Central District of California relating to certain CFC equity and debt securities. One case, entitled In re
Countrywide Financial Corp. Securities Litigation, was filed on January 25, 2008 by certain New York
state and municipal pension funds on behalf of purchasers of CFC’s common stock and certain other
equity and debt securities. The complaint alleges, among other things, that CFC made misstatements
(including in certain SEC filings) concerning the nature and quality of its loan underwriting practices and
its financial results, in violation of the antifraud provisions of the Exchange Act and Sections 11 and 12 of
the Securities Act. Plaintiffs also assert claims against BAS, MLPF&S and other underwriter defendants
under Sections 11 and 12 of the Securities Act. Plaintiffs seek unspecified compensatory damages, among
other remedies. On December 1, 2008, the court granted in part and denied in part the defendants’ motions
to dismiss the first consolidated amended complaint, with leave to amend certain claims. Plaintiffs filed a
second consolidated amended complaint. On April 6, 2009, the District Court denied the motions to
dismiss the amended complaint made by CFC and the underwriters. On December 9, 2009, the District
Court granted in part and denied in part plaintiffs’ motion for class certification. On December 23, 2009,
defendants sought interlocutory appeal of certain aspects of the District Court’s class certification decision.
On April 2, 2010, the plaintiffs and CFC in In re Countrywide Financial Corp. Securities Litigation
reached an agreement in principle to settle the case for $600 million and dismiss all claims with prejudice.
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