8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 24, 2005

COUNTRYWIDE FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-8422	13-2641992
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)
4500 Park Granada, Calabasas, California 91302
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (818) 225-3000

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

On March 24, 2005, Countrywide Financial Corporation (the “Company”) and Thomas Keith McLaughlin, the Company’s former Chief Financial Officer (the “Consultant”), entered into a Consulting Agreement and a General Release Agreement in connection with the resignation by the Consultant from his employment with the Company.

The Consulting Agreement has a stated term from April 1, 2005 to and including April 1, 2007. The Consulting Agreement may be terminated prior to the expiration of the stated term (1) upon the occurrence of certain events, such as the Consultant’s death or disability, (2) for cause by the Company, (3) at any time by the Consultant on thirty (30) days’ prior written notice to the Company, or (4) by mutual agreement of the Company and the Consultant.

The Consulting Agreement requires the Consultant to provide advisory and consulting services to the Company as reasonably requested by the Company from time to time. The requested services may not exceed three hundred eighty-four (384) cumulative hours during any twelve (12) month period during the term.

The Consultant may not, during the term of the Consulting Agreement, provide services to any third party that operates or engages in the same, or a substantially similar, line or lines of business as any of the businesses conducted by the Company (the “Protected Business”). The Consultant is not prohibited, however, from providing services to any business or entity that owns or operates, or controls another business or entity that owns or operates a business similar to the Protected Business so long as the business similar to the Protected Business constitutes less than 10% of the gross revenues of such entity together with its subsidiaries and affiliates and the Consultant is not directly involved with the business similar to the Protected Business.

During the term of the Consulting Agreement, and for a period of twelve (12) months thereafter, the Consultant shall not, directly or indirectly, interfere with the Company’s relationship with, or entice or endeavor to entice away from the Company, any person who at any time within the preceding three (3) months was an employee of the Company.

Pursuant to the General Release Agreement, (1) the Consultant has released the Company and related parties, with certain exceptions, from all claims the Consultant may have had at any time through March 24, 2005 and (2) the Company and related parties have released the Consultant, with certain exceptions, from all claims the Company and related parties may have had at any time through March 24, 2005. The General Release Agreement also provides for the survival of certain indemnification obligations of the Company and insurance coverage of the Consultant.

In consideration of the Consultant’s performance of his obligations under the Consulting Agreement, the Consultant is entitled to payment of consulting fees at an annual rate of $150,000 payable in equal monthly installments and the provision of medical, dental and vision benefits on terms provided generally to Company employees. Pursuant to the Consulting Agreement, the Consultant will be granted, subject to approval of the Compensation Committee of the Board of Directors, stock options with a value of $100,000 on April 1, 2005. The Consultant is also entitled, pursuant to the General Release Agreement, to the forgiveness of a note receivable payable to the Company in connection with a country club membership.

During the term of the Consulting Agreement, any vested and unvested stock options previously granted to the Consultant by the Company shall continue to vest and be exercisable in accordance with their terms. Pursuant to the terms of the options, the Consultant will have three months following the termination of the Consulting Agreement to exercise any options that were exercisable on the termination date.

The foregoing is a summary. Reference is hereby made to the Consulting Agreement and General Release Agreement, filed as exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K for the complete terms of such agreements.

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers

On March 28, 2005, Mr. McLaughlin, resigned from his position as Executive Managing Director, Chief Financial Officer effective as of April 1, 2005. He will provide consulting services to the Company pursuant to the Consulting Agreement.

Also on March 28, 2005, the Company’s Board of Directors elected Eric P. Sieracki, 48, as Executive Managing Director and Chief Financial Officer of the Company effective as of April 1, 2005. Mr. Sieracki is currently Senior Managing Director, Investor Relations and Corporate Development.

Mr. Sieracki joined the Company in 1988 as Senior Vice President of Countrywide Asset Management Corporation. In 1994, after holding several executive positions at the Company, he was promoted to Managing Director. Before his most recent position as Senior Managing Director, Investor Relations and Corporate Development, Mr. Sieracki held the title of Senior Managing Director and Corporate Treasurer.

Item 9.01 Financial Statements and Exhibits

10.1	Consulting Agreement between Countrywide Financial Corporation and Thomas Keith McLaughlin dated as of April 1, 2005.
10.2	General Release Agreement between Countrywide Financial Corporation and Thomas Keith McLaughlin dated March 24, 2005.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: March 30, 2005	COUNTRYWIDE FINANCIAL CORPORATION
	By:	/s/ Stanford L. Kurland
	Name:   Stanford L. Kurland
	Title:     President and Chief Operating Officer

EXHIBIT INDEX

Exhibit
No.
10.1	Consulting Agreement between Countrywide Financial Corporation and Thomas Keith McLaughlin dated as of April 1, 2005.
10.2	General Release Agreement between Countrywide Financial Corporation and Thomas Keith McLaughlin dated March 24, 2005.

EX-10.1

EXHIBIT 10.1

CONSULTING AGREEMENT

     THIS CONSULTING AGREEMENT (this “Agreement”) is made and entered into by and between Countrywide Financial Corporation, a Delaware corporation (the “Company”), and Thomas Keith McLaughlin (the “Consultant”) as of April 1, 2005 (the “Commencement Date”).

     WHEREAS, the Consultant possesses an intimate knowledge of the business and affairs of the Company and its procedures, methods and personnel, particularly in the areas of Finance, Accounting and Valuation Methodology; and

     WHEREAS, the Company desires to secure the continued services of the Consultant as a consultant to the Company and the Consultant is willing to render such services on the terms and conditions set forth herein.

     NOW, THEREFORE, in consideration of the mutual covenants contained herein, and intending to be legally bound hereby, the parties hereto agree as follows:

1. Consulting Term and Duties.

     (a) Commencement of Consulting Term. Subject to the terms and provisions of this Agreement, from the Commencement Date to and including April 1, 2007 (the “Expiration Date”), unless terminated sooner as hereinafter provided (the “Consulting Term”), the Company agrees to retain the Consultant, and the Consultant agrees to serve the Company, as an independent consultant.

     (b) Duties. During the Consulting Term, the Consultant shall render such advisory and consulting services to the Company and its affiliated companies (collectively, “Countrywide”) as reasonably requested by the Company from time to time; provided, however, that the Consultant will not be required to devote more than three hundred eighty four (384) cumulative hours during any twelve (12) month period of the Consulting Term to the performance of such services. The Company shall provide the Consultant reasonable notice of any consulting obligations and the Consultant shall have the right to reschedule commitments to the Company to accommodate his personal schedule, provided that the Consultant gives the Company reasonable notice of such intention to reschedule.

     (c) Provision of Services to Others. During the Consulting Term, the Consultant agrees that he shall not provide services, whether as a consultant, employee or otherwise, to any third party that operates or engages in the same, or a substantially similar, line or lines of business as any of the businesses conducted by Countrywide (the “Protected Business”). Notwithstanding anything to the contrary contained in this Agreement, Consultant shall not be prohibited from providing services to any business or entity that owns or operates, or controls another business or entity that owns or operates a business similar to the Protected Business so long as the business similar to the Protected Business constitutes less than 10% of the gross revenues of such entity together with its subsidiaries and affiliates and Consultant is not directly involved with the business similar

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to the Protected Business In the event the Consultant decides to provide to a third party services that are prohibited by this Section 1(c), the Consultant shall give the Company thirty (30) days prior written notice. Unless the Company consents in writing to the provision of such prohibited services to the third party, the Consulting Term shall be deemed automatically terminated on the earlier of the expiration of the thirty (30) day period, or the date on which the Consultant begins providing the prohibited services to the third party.

     (d) Services as Director. During the Consulting Term, the Consultant shall serve, at the Company Chairman’s request and without additional compensation, as a director of any subsidiary or affiliate of the Company as may be designated in writing from time to time by the Company’s Chairman or President. However, in his capacity as a director of any subsidiary or affiliate of the Company, Consultant shall have the same rights of indemnification under terms not less favorable than the terms of the most favorable indemnification agreement that may exist covering any director of the Company or any subsidiary or affiliate of the Company and shall be covered under the terms of any errors and omissions or other liability insurance covering officers and directors of the Company or any subsidiary or affiliate of the Company. Subject to approval of the Compensation Committee of the Board of Directors, in his capacity as a Director of a Company affiliate or subsidiary, Consultant will be granted stock options on April 1, 2005, in accordance with the annual grant issued to eligible employees. The amount of this grant will be $100,000 in option value; these options will be valued on the same basis in which they are issued to employees on April 1, 2005.

2. Compensation and Benefits.

     (a) In consideration of the performance by the Consultant of the Consultant’s obligations during the Consulting Term (including any services for the Company, its affiliates or otherwise), the Company shall, during the Consulting Term, pay the Consultant consulting fees at an annual rate of $150,000 (the “Consulting Fees”) payable in equal monthly installments of $12,500. The $12,500 payment for the final month of the Consulting Term shall be deemed sufficient compensation for any duties performed on April 1, 2007.

     (b) During the Consulting Term, the Company shall provide the Consultant and his family members with medical, dental and vision benefits (“Medical Benefits”) on the same terms and conditions as Countrywide makes such benefits available to its employees. The Consultant acknowledges and hereby agrees that the Consulting Fees and Medical Benefits shall be provided to him in his capacity as an independent contractor and/or as a non-employee director, as applicable, and that he shall be solely responsible for taxes imposed on him by applicable law by reason of such payments and benefits.

     (c) During the Consulting Term, any vested and unvested stock options previously granted to the Consultant by the Company (the “Options”) shall continue to

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vest and be exercisable in accordance with their terms and the terms of the applicable stock option plan of the Company pursuant to which such Options were granted.

     (d) Except as specified herein, it is understood and agreed that the Consultant will not qualify for participation in any other Countrywide benefit plan or program nor be entitled to any other form of remuneration, including salary and bonus payments for 2005.

     (e) The parties hereby acknowledge and agree that the Consulting Fees, the continued entitlement to receive the Medical Benefits, and to continue the vesting of his currently held unvested Options for the term of the CA are material inducements for Consultant to enter into this Agreement and the failure to provide such any of the Consulting Fees, Medical Benefits or continued vesting of the Options will constitute a material breach of this Agreement by the Company provided, however, that McLaughlin shall first give CFC fifteen (15) days written notice of any alleged material breach (which notice shall detail the specifics of the claimed breach) and CFC shall have fifteen (15) days to cure said material breach.

3. Equipment and Expenses.

     (a) During the Consulting Term, Countrywide shall pay for and/or provide the Consultant with (i) such computer hardware and software, (ii) such access to the Countrywide network, and (iii) such subscriptions and research tools as may be necessary to the Consultant in the performance of his duties under Section 1(b) hereof (the “Consulting Equipment”).

     (b) Upon presentation of documentation reasonably acceptable to the Company, the Company shall reimburse the Consultant for all reasonable expenses incurred by the Consultant in connection with the performance of his duties, services and responsibilities hereunder in accordance with the Company’s expense reimbursement policy in effect from time to time.

4. Termination of Consulting Term. The Consulting Term shall only be terminated as follows:

     (a) Immediately upon the Consultant’s death or his inability to substantially perform the essential duties of his position by reason of a physical or mental impairment. The Consultant and Company agree that any inability to perform such duties for four (4) consecutive calendar months would present an undue hardship to the Company;

     (b) Upon the written notice of the Company “For Cause” (as hereinafter defined). For purposes hereof, the term “For Cause” shall mean (a) a determination by the Chairman or the President of the Company that the Consultant has materially breached any of the provisions of this Agreement including, without limitation, the Consultant’s failure or refusal to substantially perform his duties as set forth in Section 1(b) hereof, or the Consultant’s material breach of any of the covenants set forth in

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Section 6 hereof, which failure, refusal or breach, as applicable, is not remedied within a reasonable period of time after receipt of written notice from the Company specifying such breach; or (b) the Consultant’s conviction by a court of competent jurisdiction of a felony or a misdemeanor involving a breach of trust;

     (c) As provided in Section 1(c) hereof;

     (d) By the Consultant at any time on thirty (30) days prior written notice to the Company;

     (d) Automatically on the Expiration Date; or

     (e) At any time on the mutual written agreement of the Company and the Consultant.

5. Effect of Termination of Consulting Term.

     (a) In the event of the expiration or termination of the Consulting Term:

(i) the Company shall pay the Consultant any accrued and unpaid portion of the Consulting Fees, and any reimbursable expenses incurred and payable to the Consultant pursuant to the terms of Section 3(b) hereof;

(ii) the Medical Benefits shall terminate as of the last day of the month in which the Consulting Term expires or terminates. However, Consultant may elect to continue health benefit coverage under the Company’s group health plan (medical, dental and vision coverages) for Consultant, Consultant’s spouse and/or eligible dependents to the extent available under the terms of the plan pursuant to the healthcare coverage continuation provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), at the same coverage level provided immediately prior to the expiration or termination of the Consulting Term (subject to any changes in employee coverage under the plan that may be made from time to time with respect to the coverage generally applicable to the Company’s employees). Consultant will pay the cost of such COBRA coverage;

(iii) no further vesting of any Options shall occur from and after the date the expiration or termination date, and, in accordance with the terms of the stock option plans pursuant to which the Consultant’s Options were granted, the Consultant shall have three months from the expiration or termination date to exercise any Options that are exercisable as of that date; and

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(iv) the Consultant shall immediately tender his resignation as a director of each Countrywide affiliate for which the Consultant serves as a director. In the event the Consultant fails or refuses to tender such resignation under this Section 5(b)(iv) hereof, the shareholder(s) of the applicable Countrywide subsidiary or affiliate shall be entitled to remove immediately the Consultant from its board of directors and the Consultant hereby agrees not to contest such removal in any manner.

     (b) Upon the termination of the Consulting Term for any reason, the Consultant shall cooperate with Countrywide in terminating access to, or returning to Countrywide, as applicable, at Countrywide’s expense, any and all Consulting Equipment.

6. Consultant Covenants.

     (a) Ownership of Inventions. The Intellectual Property Rights (as hereinafter defined) in all materials created or otherwise generated by the Consultant in the course of providing services to Countrywide during the Consulting Term shall remain Countrywide’s property. Any and all reports, documents or publications produced by the Consultant (in whatever form, whether or not fixed in a tangible medium of expression) may be reproduced or distributed by Countrywide, in whole or in part, without the Consultant’s prior written consent. For purposes hereof, the term “Intellectual Property Rights"” shall mean all patents, trademarks, design rights (whether registerable or otherwise), applications for any of these, copyrights, database rights, trade or business names and other similar rights or obligation whether registerable or not in any country. The Consultant agrees that to the maximum extent allowed by law, all such work shall be deemed to be “works made for hire” under all relevant copyright laws and Countrywide shall be deemed to be the author thereof. The Consultant hereby assigns to Countrywide all right, title and interest the Consultant may have in and to such work whether now in existence or hereinafter created. The provision of this Agreement requiring assignment of Intellectual Property Rights to the Company do not apply to any invention or other Intellectual Property Right which qualifies fully under the provisions of California Labor Code Section 2870. The provisions of this Section 6(a) shall survive the expiration, suspension or termination, for any reason, of the Consulting Term or this Agreement.

     (b) Unauthorized Disclosure. The Consultant agrees that he will not use, divulge or otherwise disclose, directly or indirectly, any trade secret or other proprietary information concerning the operation or business of Countrywide which he may have learned as a result of his consulting services and/or directorship(s) during the Consulting Term or prior thereto as an employee, officer or director of Countrywide, except to the extent such use or disclosure is (i) necessary or appropriate to the performance of this Agreement and in furtherance of the Countrywide’s best interests, (ii) required by applicable law, (iii) readily and lawfully obtainable from other sources, or (iv) authorized by the Company in writing; provided, however, that nothing in this Section 6(b) shall preclude the Consultant from using in any business, profession or calling the knowledge, skill and experience he has acquired during his employment with

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Countrywide or during the Consulting Term. For purposes of this Agreement, the terms of this Agreement shall be treated by the Consultant as confidential information. For purposes of this Agreement, the term “trade secret or other proprietary information” shall include, but is not limited to, processes, plans, devices, products, computer programs and other tangible and intangible property relating to the business of Countrywide, all information contained in documents designated as “Confidential” by Countrywide, Countrywide’s customer lists, marketing strategies and other trade secrets, all other documents and information related to Countrywide’s financial condition, organization, or business operation. The provisions of this Section 6(b) shall survive the expiration, suspension or termination, for any reason, of the Consulting Term or this Agreement.

     (c) Non-Solicitation. During the Consulting Term, and for a period of twelve (12) months thereafter, the Consultant shall not, directly or indirectly, interfere with Countrywide’s relationship with, or entice or endeavor to entice away from Countrywide, any person who at any time within the preceding 3 months was an employee of Countrywide. The provisions of this Section 6(c) shall survive following the expiration, suspension or termination, for any reason, of this Agreement or the Consulting Term.

     (d) Remedies. The Consultant agrees that any breach of the terms of this Section 6 would result in irreparable injury and damage to Countrywide for which Countrywide would have no adequate remedy at law; the Consultant therefore also agrees that in the event of said breach or any threat of breach, Countrywide shall be entitled to an immediate injunction and restraining order to prevent such breach and/or threatened breach and/or continued breach by the Consultant and/or any and all persons and/or entities acting for and/or with the Consultant, without having to prove damages, in addition to any other remedies to which Countrywide may be entitled at law or in equity, subject to the proviso set forth in the next sentence. The terms of this Section 6(d) shall not prevent Countrywide from pursuing any other available remedies for any breach or threatened breach hereof, including but not limited to the recovery of damages from the Consultant; provided, however, that any such damages shall be limited to the amount of the Consulting Fees paid to the Consultant hereunder and to any amounts that the Consultant may receive, directly or indirectly, net of applicable taxes, from any breach or threatened breach hereof. The Consultant and Countrywide further agree that the provisions of the covenants are reasonable and reasonably calculated to protect from disclosure the trade secrets and proprietary information of Countrywide. Should a court or arbitrator determine, however, that any provision of the covenants is unreasonable or unenforceable, either in period of time, scope, or otherwise, the parties hereto agree that the covenant should be interpreted and enforced to the maximum extent which such court or arbitrator deems reasonable. The provisions of this Section 6(d) shall survive any expiration, suspension or termination, for any reason, of this Agreement or the Consulting Term, and the existence of any claim or cause of action by the Consultant against Countrywide, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by Countrywide of the covenants and agreements of this Section 6(d).

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7. Indemnification.

     The Company shall indemnify the Consultant from and against any judgments, expenses (including reasonable attorney’s fees), fines and amounts paid in settlement arising out of any action, proceeding or investigation, whether civil, criminal or administrative, other than a judicial action or proceeding brought by or in the right of the Company, by reason of the fact that he is or was serving as a consultant, officer, employee or director of or to the Company so long as the Consultant acted in the course and scope of his duties as set forth herein, in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company, and with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. In any such action, the Consultant shall be represented by counsel for the Company unless it is reasonably determined that such representation would create a real or potential conflict of interest, in which event the Company shall pay for the Consultant’s counsel so long as such counsel is reasonably acceptable to the Company.

8. Miscellaneous.

     (a) Succession. This Agreement shall inure to the benefit of and shall be binding upon the Company, its successors and assigns, but without the prior written consent of Consultant, this Agreement may not be assigned other than in connection with a merger or sale of substantially all the assets of the Company or similar transaction. The obligations and duties of the Consultant herein shall be personal and not assignable.

     (b) Notices. Any notices provided for in this Agreement shall be sent to the Company at 4500 Park Granada, Calabasas, CA 91302 Attention: Chief Legal Officer, with a copy to the President of the Company at the same address, or to such other address as the Company may from time to time in writing designate, and to the Consultant at his home address as reflected in the Company’’s records or at such other address as he may from time to time in writing designate. All notices shall be deemed to have been given two (2) business days after they have been deposited as certified mail, return receipt requested, postage paid and properly addressed to the designated address of the party to receive the notices.

     (c) Entire Agreement. This Agreement, the release agreement, the Indemnification Agreement and the Arbitration Agreement are the only, entire and complete agreements of the parties relating in any way to the subject matter hereof and contain the entire agreement of the parties relating to the subject matter hereof, and replace and supersede any other prior agreements between the parties relating to said subject matter No modifications or amendments of this Agreement shall be valid unless made in writing and signed by the parties hereto.

     (d) Waiver. The waiver of the breach of any term or of any condition of this Agreement shall not be deemed to constitute the waiver of any other breach of the same or any other term or condition.

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     (e) Attorneys’ Fees in Action on Contract. If any dispute or proceeding shall occur between the Consultant and the Company, which arises out of or as a result of this Agreement or the acts of the parties hereto pursuant to this Agreement, or which seeks an interpretation of this Agreement, the trier of fact hearing the matter shall, in his sole discretion, determine the prevailing party in such proceeding and, in addition to any other judgment or award, may, in his sole discretion, award such prevailing party such sums as he shall find to be reasonable as and for the prevailing party’s attorneys’ fees and disbursements, including expert witness fees.

     (f) Severability. If any provision of this Agreement is held invalid or unenforceable, the remainder of this Agreement shall nevertheless remain in full force and effect, and if any provision is held invalid or unenforceable with respect to particular circumstances, it shall nevertheless remain in full force and effect in all other circumstances.

     (g) Arbitration. The parties acknowledge that they have previously entered into a Mutual Agreement to Arbitrate Claims (the “Arbitration Agreement”). The parties hereby incorporate herein by reference the terms of the Arbitration Agreement. Any dispute arising out of or as a result of this Agreement and/or any other matters covered by the Arbitration Agreement shall be subject to binding arbitration pursuant to the terms of the Arbitration Agreement.

     (h) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

     (i) Advice of Counsel. Consultant acknowledges that he has been advised to seek independent legal counsel for advice regarding the effect of the terms and provisions hereof, and has obtained such advice of independent legal counsel.

     (j) Certain Tax Matters. Anything to the contrary herein notwithstanding, all benefits or payments provided by the Company to Consultant that would be deemed to constitute “deferred compensation” under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) are intended to comply with Section 409A and, in the event that any such benefit or payment is deemed to not comply with Section 409A, the Company and Consultant agree to renegotiate in good faith any such benefit or payment so that either (i) Section 409A would not apply or (ii) compliance with Section 409A would be achieved. To the extent Consultant is considered a “key employee” as that term is defined in Section 416(i) of the Code (without regard to paragraph (5) thereof) who pursuant to Section 409A(a)(2)(B)(i) of the Code is subject to restrictions on the distribution of nonqualified deferred compensation before the date that is six months after the date of separation from service (or, if earlier the date of Consultant’s death) the parties shall negotiate to amend the Agreement on or before December 31, 2005 to provide either: (i) the amount of Consulting fees shall be paid in a lump sum not later than 2-1/2 months after the end of the taxable year of the Executive or the Company (whichever ends later) in which the right to such payments become legally enforceable obligations, or (ii) any consulting fees otherwise payable prior to such date shall not be paid until the date that is

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six months after the date of separation from service, at which time the aggregate amount of the delayed installments shall be paid in a lump sum.

          IN WITNESS WHEREOF, the parties have agreed that this Agreement shall be deemed executed by the Consultant and the Company as of the date referenced in Section 1 hereof.

	COUNTRYWIDE FINANCIAL CORPORATION
ATTEST:
	By:	/s/ Leora Goren
Secretary
	Title: Senior Managing Director, Chief Human
	Resources Officer
	CONSULTANT:
	/s/ Thomas Keith McLaughlin
	Thomas Keith McLaughlin, in his individual capacity

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EX-10.2

EXHIBIT 10.2

GENERAL RELEASE AGREEMENT

This General Release Agreement (“Agreement”) is entered into between Thomas Keith McLaughlin (“McLaughlin”) and Countrywide Financial Corporation (“CFC”). In consideration of the mutual benefits to be derived from this Agreement, CFC and McLaughlin hereby agree as follows:

     1. Termination of Employment. (a) McLaughlin shall continue in CFC’s employment through March 31, 2005. Effective as of the close of business on March 31, 2005, the terms of the Employment Agreement by and between McLaughlin and the Company will terminate and all obligations of McLaughlin and the Company thereunder shall terminate, except the Indemnity provisions of Section 7 of such Employment Agreement shall survive with respect to the periods prior to the termination of McLaughlin’s employment. McLaughlin shall be entitled to receive any accrued but unpaid compensation or benefits, including without limitation, reimbursable expenses and accrued vacation on the date of termination. From April 1, 2005 to April 1, 2007, McLaughlin shall be a Consultant to CFC, the terms of which will be set forth in a Consulting Agreement (“CA”) attached hereto as Exhibit “A,” and is incorporated herein by reference. McLaughlin will also be granted status with CFC which will entitle him to receive medical, dental and vision benefits and to maintain the vesting of his currently held unvested stock options for the term of the CA. The parties hereby acknowledge and agree that the consulting fees provided under the CA, the continued entitlement to receive medical, dental and vision benefits and the right to continue the vesting of his currently held unvested stock options for the term of the CA are material inducements for

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McLaughlin to enter into this Agreement and the failure to provide either the consulting fees, such benefits or continued vesting will constitute a material breach of this Agreement that will result in the terms of McLaughlin’s release in Section 5 being null and void: provided, however, that McLaughlin shall first give CFC fifteen (15) days written notice of any alleged material breach (which notice shall detail the specifics of the claimed breach) and CFC shall have fifteen (15) days to cure said material breach. McLaughlin shall not be entitled to any benefits under CFC’s general or executive benefit programs except as specifically set forth in the CA.

     2. Other Compensation. Additionally, effective March 31, 2005, McLaughlin’s note receivable for the North Ranch Country Club held by CFC will be forgiven; McLaughlin will assume any ongoing membership dues and assessments.

     3. Non-solicitation. McLaughlin shall be subject to a non-solicitation covenant as set forth in the CA attached hereto as Exhibit “A.”

     4. No Complaints, Charges or Lawsuits. McLaughlin represents that he has not filed any complaints or charges or lawsuits against CFC or others released by this Agreement with any governmental agency, arbitration organization or court, and that he will not do so at any time hereafter based upon any matter released in this Agreement. This shall not limit McLaughlin from pursuing claims for the sole purpose of enforcing his rights under this Agreement or the CA.

     5. Mutual Releases. The parties hereby enter into the following releases:

          (a) McLaughlin’s Release of Company. In consideration for entering into the CA and for the other compensation described in this Agreement, except for the rights and obligations created by this Agreement and the specific exceptions described herein,

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McLaughlin hereby releases, acquits and forever discharges CFC, its subsidiaries, and any other affiliated entities and/or successors, assigns, partners, and any other current or former employees, agents, directors, officers, trustees, stockholders, attorneys and insurers (“Released Parties”) from any claims, expenses, debts, demands, costs, contracts, liabilities, obligations, actions and causes of action of every nature, whether known or unknown, whether in law or in equity, which he had or has or may claim to have by reason of any and all matters from the beginning of time to the present, including any and all rights and claims the McLaughlin may have for alleged age discrimination arising under the Age Discrimination in Employment Act of 1967, as amended, or any other federal, state or local law relating to age discrimination. This Agreement does not waive or release any rights or claims that McLaughlin may have: (i) which arise after the date McLaughlin signs this Agreement; (ii) for a breach of the provisions of this Agreement or the CA; (iii) under the Employee Retirement Income Security Act of 1974, as amended (ERISA) or under the terms of any Company benefit plan; (iv) any claim for indemnification under the terms of any indemnification agreement or provision applicable to McLaughlin by reason of the fact that he is or was serving as an employee, officer, director or consultant of or to the Company or any subsidiary or affiliate; or any claim for coverage under the terms of any directors and officers liability insurance coverage maintained by the Company applicable to McLaughlin by reason of the fact that he is or was serving as an employee, officer, director or consultant of or to the Company or any subsidiary or affiliate.

          (b) Company’s Release of McLaughlin. In exchange for the mutual obligations set forth herein and except for the rights and obligations created by this

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Agreement and the specific exceptions described herein, CFC, its subsidiaries, and any other affiliated entities and/or successors, assigns, partners, and any other current or former employees, agents, directors, officers, trustees, stockholders, attorneys and insurers (“CFC Parties”) hereby release, acquit and forever discharge McLaughlin from any claims, expenses, debts, demands, costs, contracts, liabilities, obligations, actions and causes of action of every nature, whether known or unknown, whether in law or in equity, which the CFC Parties or any of them had or has or may claim to have by reason of any and all matters from the beginning of time to the present. This Agreement does not waive or release any rights or claims that the CFC Parties may have: (i) which arise after the date McLaughlin signs this Agreement; (ii) for a breach of the provisions of this Agreement or the CA; (iii) for any willful or intentional act which is committed in bad faith or without reasonable belief that such act was in the best interests of the Company or its shareholders; or (iv) for any act of theft or embezzlement from CFC; or, for any willful violation of securities law.

     6. Release of Unknown and Unsuspected Claims. For the purposes of effecting a complete settlement of all claims which McLaughlin may have or claim to have against the Released Parties or the CFC Parties may have against McLaughlin, McLaughlin and the CFC Parties waive and release any and all claims within the scope of this Agreement, including claims which are unknown and unsuspected as of this time. McLaughlin and the Company on behalf of the CFC Parties acknowledge that they understand California Civil Code section 1542 which provides as follows:

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A general release does not extend to claims, which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.

     7. Liability Denied. Nothing contained herein should be construed as an admission by any party of any liability of any kind with respect thereto. All such liability is expressly denied.

     8. Parties’ Full Understanding. Each party represents and warrants that each party has had the opportunity to discuss this Agreement with an attorney, that each party has carefully read and understands each provision hereof and that each party is entering into this Agreement voluntarily.

     9. Confidentiality/Inquiries. McLaughlin agrees not to disclose to, or discuss with any person (except his family members, legal counsel, auditors or accountants) any of the terms, content and existence of the Agreement, including the negotiations leading to this Agreement, except as may be required by subpoena or to effectuate the terms of this Agreement, or as necessary to advise a prospective employer of his obligations under the CA.

     10. Confidential Information. McLaughlin’s specific obligations to maintain the confidentiality of information is set forth in the CA.

     11. Arbitration. The parties acknowledge that they have previously entered into a Mutual Agreement to Arbitrate Claims (the “Arbitration Agreement”) attached hereto as Exhibit B. The parties hereby incorporate herein by reference the terms of the Arbitration Agreement. Any dispute arising regarding this Agreement and/or any other

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matter covered by the Arbitration Agreement shall be subject to binding arbitration pursuant to the terms of the Arbitration Agreement, except as expressly provided herein.

     12. Sole Agreement. This Agreement, the CA, the Indemnification Agreement and the Arbitration Agreement are the only, entire and complete agreements of the parties relating in any way to the subject matter hereof. No statements, promises or representations have been made by any party to any other, or relied upon, and no consideration has been offered, promised, expected or held out other than as expressly provided herein, provided only that the release of claims in any prior agreement or release shall remain in full force and effect.

     13. Attorneys’ Fees. Should any legal action, including arbitration, be filed by either party as a result of the breach of this Agreement, the prevailing party in such action shall be entitled to full reimbursement of its attorneys’ fees, costs and expenses incurred in such action.

     14. Severability. Should any provision of this Agreement be declared or determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby and said illegal or invalid part, term or provision shall not be deemed to be a part of this Agreement.

     15. Withholding. Any compensation, including perquisites, which McLaughlin receives from CFC in connection with his prior employment is subject to withholding for Federal, state and local taxation, and other authorized deductions. McLaughlin understands that CFC may or may not withhold these taxes, and that he is solely responsible for the payment of taxes due on the compensation, including perquisites, which he will receive under this Agreement.

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     16. Rescission of Age Claims. McLaughlin acknowledges that he has been advised to seek the advice of legal counsel before signing this Agreement. He further acknowledges that he has had as much time as necessary to review this Agreement and to decide whether to enter into it. He further understands that he could have at least twenty-one (21) days to make this decision, if he so desired. Lastly, he understands that within seven days of his execution of this Agreement, he can rescind this release of any and all rights and/or claims he has for alleged age discrimination under the Age Discrimination in Employment Act of 1967 by notifying the Chief Legal Officer. Should McLaughlin elect to rescind this release, his employment shall terminate on the date of rescission, and the CA shall be null and void.

     17. Survival of Indemnification and D&O Insurance Coverage.

          (a) Insurance. To the extent that the Company maintains any errors and omissions or other liability insurance covering officers and directors (“Insurance”), McLaughlin shall continue to be covered under such policy or policies for the periods that he is or was serving as an employee, officer, director or consultant of or to the Company or any subsidiary or affiliate in accordance with the terms of such Insurance. Such Insurance in effect as of the date of this Agreement, is current, valid and in effect as of the date hereof and the Company is not aware of any intention or reason on the part of the carrier or the Company to terminate the policy or of any material default under the policy. If necessary to continue the coverage for McLaughlin, the Company agrees to obtain any rider or tail coverage that may be required to keep such coverage in effect . However, nothing herein shall in any way require the Company to continue to maintain any Insurance; provided, that the Company shall provide to McLaughlin notice of any

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material modification (including a copy of such modification) or termination of Insurance.

          (b) Indemnification. Notwithstanding any provisions of this Agreement to the contrary, the terms of any indemnification agreement or provision applicable to McLaughlin by reason of the fact that he is or was serving as an employee, officer, director or consultant of or to the Company or any subsidiary or affiliate shall survive his termination of employment and any expiration or termination of this Agreement or the CA.

     18. Certain Tax Matters. Anything to the contrary herein notwithstanding, all benefits or payments provided by the Company to McLaughlin that would be deemed to constitute “deferred compensation” under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), whether pursuant to this Agreement or otherwise, are intended to comply with Section 409A and, in the event that any such benefit or payment is deemed to not comply with Section 409A, the Company and McLaughlin agree to renegotiate in good faith any such benefit or payment so that either (i) Section 409A would not apply or (ii) compliance with Section 409A would be achieved. To the extent McLaughlin is considered a “key employee” as that term is defined in Section 416(i) of the Code (without regard to paragraph (5) thereof) who pursuant to Section 409A(a)(2)(B)(i) of the Code is subject to restrictions on the distribution of nonqualified deferred compensation before the date that is six months after the date of separation from service (or, if earlier the date of McLaughlin’s death), the parties shall negotiate to amend the relevant agreement on or before December 31, 2005 to provide either: (i) the amount of deferred compensation shall be paid in a lump sum not later than

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2-1/2 months after the end of the taxable year of McLaughlin or the Company (whichever ends later) in which the right to such payments become legally enforceable obligations, or (ii) any deferred compensation benefits otherwise payable prior to such date shall not be paid until the date that is six months after the date of separation from service, at which time the aggregate amount of the delayed installments shall be paid in a lump sum.

     18. Advice of Counsel. McLaughlin acknowledges that he has been advised to seek independent legal counsel for advice regarding the effect of the terms and provisions hereof, and has obtained such advice of independent legal counsel.

          IN WITNESS WHEREOF, the parties have executed this instrument on the dates indicated below.

DATED	March 24, 2005	EMPLOYEE
		/s/ Thomas Keith McLaughlin
		Thomas Keith McLaughlin
DATED:	March 24, 2005	COUNTRYWIDE FINANCIAL CORPORATION
ATTEST:
		By:	/s/ Leora Goren
Secretary
		Title: Senior Managing Director, Chief
		Human Resources Officer

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