Exhibit 10.1


    
      
        CONFIDENTIAL

        SETTLEMENT
          AND GENERAL RELEASE AGREEMENT

        


        This
          Settlement and General Release Agreement ("AGREEMENT") is entered into
          by and
          between CLIFFORD L. STRAND ("STRAND"), SECURED DIVERSIFIED INVESTMENT,
          LTD.
          ("SDP') and JAN WALLACE ("WALLACE") referred to jointly as the "PARTIES"
          as of
          the date this AGREEMENT is signed, with reference to the following
          terms:

        


        RECITALS

        


        A.  On
          or
          about January 13, 2006, Alliance Title Company filed an lnterpleader lawsuit
          Case Number 06CC02129 in the Orange County Superior Court, Department C11
          against STRAND, WILLIAM S. BIDDLE ("BIDDLE"), GERNOT TROLF
          ("TROLF"), NATIONWIDE COMMERICAL BROKERS ("NATIONWIDE"),
          SDI and
          others and as result, deposited with the Court the funds in the amount
          of
          $267,000.00.

        


        On
          or
          about January 20, 2006, STRAND, BIDDLE, TROLF and NATIONWIDE filed a separate
          lawsuit Case Number 06CC02350 in the Orange County Superior Court, Department
          C11 against SDI and one of its officers WALLACE along with others for Fraud
          and
          Misrepresentation, Negligent Misrepresentation, Breach of Contract,
          Breach of the Covenant of Good Faith and Fair Dealing, Conversion,
          Commons
          Counts,
          Money had and received and Declaratory Relief. On or about March 15, 2006
          SDI
          filed a cross-complaint against the Plaintiffs along with others for Breach
          of
          Contract, Breach of Fiduciary Duty, Negligent Supervision, Civil Conspiracy,
          Intentional Interference with Economic Relations; Negligent Interference
          with
          Economic Relations; Breach of Oral Agreement, Breach of Employment Contract;
          Breach of Directors/Officers' Fiduciary Duty; Fraud and Intentional
          Misrepresentation and Declaratory Relief.

        


        B.  On
          or
          about March 10, 2006, STRAND BIDDLE, TROLF along with another shareholder,
          filed
          a lawsuit against SDI for declaratory relief under Corporation Code Section
          2115, Case Number 06CC03959, filed
          in the
          Orange County Superior
          Court, Department C11. Both litigations shall be referred to as the
          "ACTIONS".

        


        C.  STRAND
          filed a complaint with the Securities and Exchange Commission of the United
          States of America ("SEC") in regard to his objections to the June 2, 2006
          SDI
          shareholder meeting which he has not taken nor does he intend to any further
          action on.

        


        D.  On
          or
          about September 19, 2006 DIDDLE, TROLF and NATIONWIDE
          entered into a settlement agreement with SDI and WALLACE which is
          incorporated herein by reference. In addition BIDDLE, TROLF and NATIONWIDE
          dismissed, with prejudice, their claims in the ACTIONS against SDI and
          WALLACE.
          SDI and WALLACE dismissed, with prejudice, their claims in the ACTIONS
          against
          BIDDLE, TROLF and NATIONWIDE.

        


        E.  The
          parties expressly acknowledge that they have no personal 


        
          
            
            

          

          
             

            
              

            

          

          
            
            

          

        


        knowledge
          of any liability, fraud or wrongdoing on the part of any other party, its
          agents, officers, directors, stockholders, employees, successors, assigns,
          insurers and attorneys with respect to any claims in the ACTIONS, or with
          respect to any other matters relating to it. No provision hereof or of
          any
          related document shall be construed as an admission or concession of liability
          or fraud or of any wrongdoing or of any preexisting liability. However,
          in order
          to fully and
          forever
          resolve these matters, and with the understanding that this AGREEMENT does
          not
          constitute an admission by any party of any wrongdoing or of any lack of
          merit
          relating to any claims referred to herein, STRAND, SDI, and WALLACE enter
          into
          this AGREEMENT.

        


        AGREEMENT

        


        1.  In
          consideration for the promises set forth herein, the PARTIES agree as
          follows:

        


        	a.  	
                The
                  PARTIES agree that (1) upon execution by STRAND and his attorney
                  of this
                  AGREEMENT, (2) upon execution of a stipulation and order of disbursement
                  and requests for dismissal with prejudice in the above ACTIONS
                  attached
                  hereto as Exhibit A and incorporated herein by reference, and (3)
                  upon
                  execution by STRAND Irrevocable Proxy attached hereto as Exhibit
                  B and
                  incorporated herein by reference, The PARTIES shall file with the
                  Orange
                  County Superior Court a stipulation and order of disbursement as
                  follows
                  and for the benefit of: $80,000 to STRAND and the remainder to
                  SDI; in
                  addition the PARTIES shall also
                  file
                  the requests for dismissal. The payments shall be in one lump sum
                  with no
                  payroll or other taxes deducted.

              


        


        	b.  	
                SDI
                  makes no
                  representations
                  or warranties regarding the tax effect of the settlement proceeds
                  as
                  directed by this AGREEMENT. Further, STRAND agrees to defend and/or
                  indemnify SDI with respect to any liability created by STRAND'S
                  payment or
                  non-payment of taxes with respect to the settlement
                  sum.

              


        


        2.  STRAND,
          as the first party, and SDI and WALLACE as
          a
          second
          party, on their own behalf
          and on behalf of their respective dependents, successors, heirs, executors,
          administrators and assigns, and each of them, hereby fully and forever
          releases
          and discharges each other, and any parent companies, any subsidiaries,
          any
          predecessors in interest, any successors in interest, any companies associated
          as a result of an asset purchase or any affiliated companies or organizations,
          as well as their agents, officers, directors, stockholders, employees,
          successors, assigns, insurers and attorneys, and each of them, of and from
          any
          and all claims, rights, actions, causes of action, obligations, debts,
          interest,
          damages, charges, losses, debts, penalties, forfeitures, liabilities, costs,
          attorneys' fees, and demands of any nature, whether in law or in equity,
          arising
          out of or relating to any acts or omissions that took place prior to the
          date of
          this AGREEMENT, including without limitation, any matters relating in any
          way to
          the ACTIONS and/or any matters relating to or contained in or which could
          have
          been contained in the ACTIONS and/or any claims under other Federal or
          State
          statute, law
          or
          regulation.

        


        3.  It
          is the
          intention of the PARTIES hereto that this AGREEMENT shall be effective
          as a full
          and final accord and satisfaction and release of each and every released
          matter,
          including all unknown and/or unsuspected claims. Accordingly,
          the


        
          
            
            

          

          
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        PARTIES
          hereby waive and relinquish any and all rights or benefits that any party
          may
          have under the provisions of Section 1542 of the California Civil Code,
          which
          reads as follows:

        


        "A
          general release does not extend to claims which the creditor does not know
          or
          suspect to exist in
          its
          favor


        at
          the
          time of executing the release, which if known by him must have materially
          affected his settlement with the debtor."

        


        In
          connection with this waiver, each party hereto acknowledges that facts
          in
          addition to or different from those presently known may later be discovered
          which relate to the subject matter of this AGREEMENT. The PARTIES also
          recognize
          the possibility that, in the future, damages that are not currently known
          may be
          suffered in relation to matters released in this AGREEMENT. Notwithstanding
          these possibilities, it is each party's intention to fully, finally and
          forever
          settle and release all released matters, disputes and differences, whether
          known
          or unknown, suspected or unsuspected, that have existed; now exist, or
          may
          exist. It is the intention of the PARTIES hereto that this AGREEMENT shall
          be
          effective as a full and final accord and satisfaction and release of each
          and
          every released matter, including all unknown and/or unsuspected claims.
          In
          connection with this waiver, each party hereto acknowledges that facts
          in
          addition to or different from those presently known may later be discovered
          which relate to the subject matter of this AGREEMENT. The PARTIES also
          recognize
          the possibility that, in the future, damages that are not currently known
          may be
          suffered in relation to matters released in this AGREEMENT. Notwithstanding
          these possibilities, it is each party's intention to fully, finally and
          forever
          settle and release all released matters, disputes and differences, whether
          known
          or unknown, suspected or unsuspected, that have existed; now exist, or
          may
          exist. Nothing in this AGREEMENT constitutes, or should or shall be deemed
          to
          constitute, any admission of any act, fact or liability, with respect to
          any
          matters released herein.

        


        4. STRAND
          represents that he does not desire reemployment by SDI as an officer or
          reelection as a director and hereby expressly waives any and all rights
          which he
may
          have
          had
          to such reemployment or to reinstatement with SDI. Further, STRAND agrees
          and
          promises that he will not at any time seek employment or reemployment with
          SDI
          and/or any other party or entity released herein as an officer or reelection
          as
          a director.

        


        5. The
          contents and the existence of this AGREEMENT, and the PARTIES' discussions
          pertaining to it, are and shall remain forever confidential, and neither
          party
          will
          communicate or allow communication in any manner (written, oral or otherwise)
          to
          anyone with respect thereto, except that this AGREEMENT may be disclosed
          as
          required to the PARTIES'
          attorneys, insurers, accountants and/or governmental authorities, or otherwise
          may be disclosed as compelled by law. If any party beaches any clause of
          the
          AGREEMENT other party may seek all rights and remedies under the law including
          but not limited to attorney's fees and costs.

        


        6. The
          PARTIES hereto, and each of them, shall forever refrain and forbear from
          commencing, instituting, or prosecuting any lawsuit, action or other proceedings
          against any of the other PARTIES related to the claims released herein.
          Such
          forbearance from commencing, instituting or prosecuting any lawsuit, action
          or
          other proceeding by one such party against the other shall include not
          only such
          other parties,


        
          
            
            

          

          
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        but
          their
          officers, directors, representatives, assigns, agents, attorneys, heirs,
          employees, partners and personal representatives as well, and such forbearance
          shall apply to any cause relating to, based upon or arising out of any
          and all
          claims, debts, liabilities, demands, obligations, costs, expenses, actions
          or
          causes of action, released and discharged hereunder, except those necessary
          to
          enforce the terms of this agreement.

        


        7. Each
          party agrees to bear its/her own costs, expenses and attorneys'
          fees incurred
          in connection with the ACTIONS and this AGREEMENT.

        


        8. Each
          party hereto expressly warrants and represents that they are fully authorized
          to
          enter into this AGREEMENT and each of its terms, and that they have not
          assigned
          to any other party or person any claims released herein.

        


        9. With
          the
          exception of the claims listed in the RECITALS above STRAND warrants that
          he has
          not filed any other lawsuits, charges, complaints, petitions, or other
          accusatory pleading against SDI and/or WALLACE with any governmental agency
          or
          in any court, on behalf of himself or any other entity he represents, based
          upon, arising out of or related in any way to any events occurring prior
          to the
          execution of this Agreement, including, without limiting the generality
          of the
          foregoing ACTIONS. STRAND further agrees that he will not hereafter file,
          cause
          to be filed, or otherwise voluntarily participate in the filing, investigation,
          and/or prosecution of any other charges, complaints, petitions or accusatory
          pleading brought by any other party in any court currently pending or not
          or
          with any governmental agency in which WALLACE and/or SDI, its officers,
          directors, shareholders, agents, attorneys or any parent companies, any
          subsidiaries, any predecessors in interest, any successors in interest,
          any
          companies associated as a result of an asset purchase or any affiliated
          companies or organizations is named as a party.

        


        With
          the
          exception of the claims listed in the RECITALS above WALLACE and/or SDI
          warrant
          that they have not filed any other lawsuits, charges, complaints, petitions,
          or
          other accusatory pleading against STRAND with any governmental agency or
          in any
          court, on behalf of themselves or any other entity they represent, based
          upon,
          arising out of or related in any way to any events occurring prior to the
          execution of this Agreement, including, without limiting the generality
          of the
          foregoing ACTIONS. WALLACE and/or SDI further agrees that they will not
          hereafter the, cause to be filed, or otherwise voluntarily participate
          in the
          filing, investigation, and/or prosecution of' any other charges, complaints,
          petitions or accusatory pleading brought by any other party in any court
          currently pending or not or with any governmental agency in which STRAND
          is
          named as a party.

        


        10. This
          AGREEMENT contains the entire agreement between the PARTIES hereto with
          respect
          to all matters addressed herein, and fully supersedes any and all prior
          or
          contemporaneous agreements, understandings or representations, oral or
          written,
          implied or express, pertaining to the subject matter hereof. All prior
          and
          contemporaneous discussions and negotiations have been and are merged and
          integrated into, and are superseded by this Agreement. This AGREEMENT may
          only
          be subsequently modified by a writing signed by all PARTIES hereto.

        


        11. Each
          party agrees to do all things necessary to carry out and 


        
          
            
            

          

          
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        effectuate
          the terms of this AGREEMENT, and expressly promises not to do or fail to
          do
          anything, directly or indirectly, which will interfere with any other party's
          realization of the benefits hereof.

        


        12. This
          AGREEMENT, including the releases herein, shall be binding upon and inure
          to the
          benefit of each of the PARTIES to this AGREEMENT and to each of their successors
          in interest, including heirs and assigns.

        


        13. Each
          of
          the PARTIES hereto has been represented by counsel in the negotiating and
          drafting of this AGREEMENT. Accordingly, the rules of construction of contracts
          relating to resolution of ambiguities against the drafting PARTIES shall
          be
          inapplicable to this AGREEMENT.

        


        14. Any
          construction, interpretation and performance of this AGREEMENT shall be
          governed
          by the laws of the State of California, both substantive and procedural.
          Both
          PARTIES accede to the jurisdiction of the Orange County Superior Court
          for any
          actions to enforce, or for breach of, any term of this AGREEMENT.

        


        15. If
          for
          any reason any provision contained in this AGREEMENT is later deemed
          unenforceable, the remainder of this AGREEMENT shall nonetheless remain
          binding
          and enforceable on all
          PARTIES
          hereto.

        


        16. In
          the
          event of any action brought to enforce any provision of this AGREEMENT,
          or for
          breach of any provision of this AGREEMENT, the prevailing party therein
          shall be
          entitled to an award of their costs and reasonable attorneys' fees incurred
          therein, in addition to any other relief.

        


        17. This
          AGREEMENT may be executed in multiple originals or counterparts, each of
          which
          shall be deemed an original or the equivalent thereof.

        


        WHEREFORE,
          each party hereto, by the signatures below, certifies that this AGREEMENT
          has
          been read in its entirety, that any questions regarding the meaning or
          effect of
          any terms have been answered to their satisfaction, that each party enters
          into
          this AGREEMENT with the intent to be fully and forever bound by all of
          its
          terms, as of the date set forth opposite their signature below.


        
          
            
            

          

          
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                  Dated:
                    January 5, 2007

                	
                  /s/
                    Clifford Strand

                
	 	
                  Clifford
                    Strand

                
	 	 
	
                  APPROVED
                    AS TO FORM AND CONTENT:

                  LAW
                    OFFICES OF ROBERT COVIELLO

                   

                  /s/
                    Robert Coviello

                  ROBERT
                    COVIELLO

                  ATTORNEY
                    FOR CLIFFORD STRAND

                	 
	
                   

                   

                  Dated:
                    January 5, 2007

                	
                   

                   

                  By:
                    /s/
                    Jan Wallace

                
	 	
                  JAN
                    WALLACE

                  CEO

                  SECURED
                    DIVERSIFIED INVESTMENT,

                  LTD.

                
	 	 
	
                  Dated:
                    January 5, 2007

                   

                   

                  APPROVED
                    AS TO FORM AND CONTENTS:

                	
                  /s/
                    Jan Wallace

                  JAN
                    WALLACE

                   

                   

                
	
                   

                  By:
                    /s/ Claire C. Ambrosio

                  CLAIR
                    C. AMBROSIO

                  ATTORNEY
                    FOR SECURED

                  DIVERSIFIED
                    INVESTMENT, LTD.

                	 


        

         

        
          
            
            

          

          
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        EXHIBIT
          A

        


        
          
            
            

          

          
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            EXHIBIT
              B

             

            
              
                
                

              

              
                15