exhibit10_1.htm


    Exhibit
10.1

    SETTLEMENT
AGREEMENT

    


    This Settlement Agreement is entered
into as of December 17, 2008 by and among the Federal Deposit Insurance
Corporation as manager of the FSLIC Resolution Fund and in its corporate
capacity (“FDIC”) and Charles E. Hurwitz (“Hurwitz”), MAXXAM Inc. (“MAXXAM”) and
Federated Development Co. (“Federated”).  Hurwitz, MAXXAM and
Federated shall be referred to collectively as the “Hurwitz Related
Parties.”

     

    WHEREAS, there is presently pending in
the United States District Court for the Southern District of Texas a proceeding
captioned FDIC v. Charles E.
Hurwitz et al., Civil Action No. H-95-3956 (the “District Court
action”);

     

    WHEREAS, the FDIC has made various
claims against Hurwitz in these proceedings arising out of the failure of United
Savings Association of Texas, Houston, Texas (“USAT”) and the Hurwitz Related
Parties have made various claims against the FDIC;

     

    WHEREAS, the Hurwitz Related Parties
deny any and all of the claims made by the FDIC; for its part, the FDIC denies
any and all claims made by the Hurwitz Related Parties;

     

    WHEREAS, the Hurwitz Related Parties
and the FDIC desire to avoid the risks and expense attendant upon further
litigation of the controversies existing between them and desire to settle and
release all claims and demands of any kind whatsoever among them relating to the
District Court action.

     

    NOW,
THEREFORE, in consideration of the promises, undertakings, payments, and
releases stated herein, the sufficiency of which consideration is hereby
acknowledged, the undersigned parties agree, each with the other, as
follows:

     

    1.0           Representations and
Warranties     The parties to this Settlement
Agreement make the following representations and warranties to one
another:


    
      FDIC v.
Hurwitz                                                              


      Settlement
Agreement

      December
17, 2008

    

    
      
         


      

      
        1

        
          

        

      

      
         


      

    


    1.1           The
FDIC represents that it has no claims against the Hurwitz Related Parties or any
of their officers, directors, attorneys, or agents arising out of the failure of
USAT other than those asserted in the District Court action; that it is the
proper owner of such claims; and that it has not assigned or transferred such
claims to any other person, entity or agency, whether state or
federal.

     

    1.2           The
Hurwitz Related Parties represent that they have no claims against the FDIC or
any of its officers, directors, attorneys or agents other than those asserted in
the District Court action; that they are the proper owners of such claims; and
that such claims have not been assigned or transferred to any other person or
entity.

     

    1.3           The
execution of this Settlement Agreement is only for the purpose of the settlement
and compromise of disputed claims.  Any action taken pursuant to this
Settlement Agreement shall not be construed, deemed, considered or used as an
admission of liability or fault by either the Hurwitz Related Parties or by the
FDIC against one another or against any third party in the District Court action
or any other proceeding.

     

    1.4           Each
of the parties severally declares and represents that he or it is executing this
Settlement Agreement wholly upon his or its volition, individual judgment and
knowledge and that this Settlement Agreement is made without reliance upon any
statement or representation of any party other than the representations,
warranties, and statements of obligation set forth in this Settlement
Agreement.

     

    2.0           Payment of Settlement
Funds

     

    2.1           For
complete release of all claims that any party to this Settlement Agreement has
against any other party to this Settlement Agreement, and in return for the
representations and warranties entered into, the FDIC shall pay to MAXXAM the
sum of ten million dollars ($10


    
      
        
          FDIC v.
Hurwitz                                                              


          Settlement
Agreement

          December
17, 2008

        

         


      

      
        2

        
          

        

      

      
         


      

    


    million)(“Settlement
Funds”) to be paid by wire transfer in accordance with the instructions provided
by MAXXAM’s counsel to the FDIC or its counsel.  Payment of the
Settlement Funds shall occur within two business days of receipt by the FDIC of
a fully executed Settlement Agreement; otherwise, this Agreement shall be null
and void.

     

    2.2           In
the event that Hurwitz, MAXXAM or Federated breach any of their obligations of
any kind under this Settlement Agreement, this agreement shall be of no effect
and any sums paid pursuant to Paragraph 2.1 shall be recoverable by the FDIC
from the Hurwitz Related Parties with interest and reasonable attorneys
fees.

     

    2.3           In
the event that the FDIC breaches any of its obligations of any kind under this
Settlement Agreement, and it becomes necessary for Hurwitz, MAXXAM, or Federated
to enforce such settlement agreement, such parties may recover their reasonable
attorneys fees in doing so.

     

    3.0           Releases

     

    3.1           The
Hurwitz Related Parties and each of them hereby releases the FDIC, its officers,
directors, agents, employees, attorneys and affiliates and all successors and
predecessors to same, from any and all claims, causes of action, rights,
expenses, debts, liabilities, demands, obligations, costs, agreements and
actions of any kind and character whether known or unknown, suspected or
unsuspected, direct or indirect that were or could have been asserted by or on
behalf of the Hurwitz Related Parties or any of them in any court, arbitration,
mediation or any administrative or regulatory forum arising out of or related in
any way to any of the acts omissions or occurrences that were or could have been
a part of the District Court action or related proceeding.


    
      
        
          FDIC v.
Hurwitz                                                              


          Settlement
Agreement

          December
17, 2008

        

         


      

      
        3

        
          

        

      

      
         


      

    


    3.2           For
its part, the FDIC hereby releases each of the Hurwitz Related Parties and each
of their officers, directors, agents, employees, attorneys, affiliates and all
successors and predecessors to same, from any and all claims, causes of actions,
rights, expenses, debts, liabilities, demands, obligations, costs, agreements
and actions of any kind and character whether known or unknown, suspected or
unsuspected, direct or indirect that were or could have been asserted by or on
behalf of the FDIC in any court, forum, administrative or regulatory forum
arising out of the failure of USAT or related in any way to any act, omission or
occurrence that were or could have been a part of the District Court action or
related proceeding.

     

    3.3           No
release contained herein shall prevent any Party hereto from enforcing its
rights under this Agreement.

     

    4.0           Dismissal.       Upon
execution of this Agreement by each of the undersigned Parties, and receipt of
the Settlement Funds, the parties shall jointly request that all matters of any
kind whatsoever pending in the District Court action be fully dismissed with
prejudice.  Such dismissal shall be final and not subject to
appeal.  The undersigned parties agree to the entry of an order of
dismissal with prejudice in the form attached hereto as Exhibit “A”, with each
party to bear its own costs as these were originally incurred.

     

    5.0           Necessary
Documents.     All parties to this Agreement
agree to enter into and execute such documents or instruments as may be
necessary to effectuate the provisions of this Agreement.

     

    6.0           Miscellaneous
Provisions.

     

    6.1           This
written Settlement Agreement and any separate written documents executed by and
between the Parties simultaneously with the execution of this Settlement
Agreement constitute the entire agreement and understanding among them with
respect to the subject matter


    
      
        
          FDIC v.
Hurwitz                                                              


          Settlement
Agreement

          December
17, 2008

        

         


      

      
        4

        
          

        

      

      
         


      

    


    hereof
and they supersede all prior agreements and understandings, both written and
oral, concerning such matters.  This Agreement may not be amended or
modified except by another written instrument signed by the party or parties to
be bound thereby, or by their respective authorized attorney(s) or other
representative(s).

     

    6.2           The
undersigned parties agree to cooperate in good faith to effectuate all the terms
and conditions of this Agreement including doing or
causing their agents and attorneys to do, whatever is reasonably necessary to
effectuate the signing, delivery, execution, filing, recording, and entry, of
any documents necessary to conclude the District Court action according to the
terms of this Agreement.

     

    6.3           Each
of the undersigned persons represents and warrants that they are a party hereto
or are authorized to sign this Agreement on behalf of the respective party, and
that they have the full power and authority to bind such party to each and every
provision of this Agreement.  This Agreement shall be binding upon and
inure to the benefit of the undersigned parties and their respective heirs,
executors, administrators, representatives, successors and assigns.

     

    6.4           Multiple
counterparts of this Settlement Agreement may be signed by the Parties, each of
which shall be an original, but all of which together shall constitute one and
the same Settlement Agreement.  Such counterparts may also be executed
by telefaxed or emailed signature.

     

    6.5           Each
of the Parties has had the benefit of the advice of counsel of their own choice
in the negotiating, drafting and execution of this Agreement, and the language
of this Settlement Agreement is the product of the efforts of all
counsel.  Accordingly, neither the entire


    
      
        
          FDIC v.
Hurwitz                                                              


          Settlement
Agreement

          December
17, 2008

        

         


      

      
        5

        
          

        

      

      
         


      

    


    Settlement
Agreement nor any provision in it shall be deemed to have been proposed or
drafted by any party.  The Agreement shall be construed as a whole
according to its plain meaning.

     

    6.6           In
the event of any dispute arising out of this Settlement Agreement, including but
not limited to, any dispute concerning the interpretation or meaning of any
terms or provisions thereof, the laws of the State of Texas shall
apply.

     

    In WITNESS WHEREOF, the Parties have
executed this Settlement Agreement as of December 17, 2008.

    



    
      
        
          FDIC v.
Hurwitz                                                              


          Settlement
Agreement

          December
17, 2008

        

         


      

      
        6

        
          

        

      

      
         


      

    


    


    
      	 
      	
               

                                            FEDERAL
      DEPOSIT INSURANCE CORPORATION,

            
	 
      	 
      	 
      
	 
      	
                                            By:

            	
                   
      /s/ Robert J. DeHenzel, Jr.

            
	 
      	
                                            Date:

            	
                 December 17,
      2008

            
	 
      	 
      	 
      
	 
      	
                                            CHARLES
      E. HURWITZ

            
	 
      	
                                            By:

            	
                   
      /s/ Charles E. Hurwitz

            
	 
      	
                                            Date:

            	
                
    12-16-08

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                            MAXXAM
      INC.

            
	 
      	
                                            By:

            	
                   
      /s/ Charles E. Hurwitz

            
	 
      	
                                            Date:

            	
                
    12-16-08

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                            FEDERATED
      DEVELOPMENT CO.

            
	 
      	
                                            By:

            	
                  
       /s/ Charles E. Hurwitz

            
	 
      	
                                            Date:

            	
                
    12-16-08

            
	 
      	 
      	 
      


    

    


    



    
      
        
          FDIC v.
Hurwitz                                                              


          Settlement
Agreement

          December
17, 2008

        

         


      

      
        7

        
          

        

      

      
         


      

    


    IN THE
UNITED STATES DISTRICT COURT

    FOR THE
SOUTHERN DISTRICT OF TEXAS

    HOUSTON
DIVISION

    


    
      	
              FEDERAL
      DEPOSIT INSURANCE

              CORPORATION
      as manager of the FSLIC Resolution Fund,

               

              Plaintiff,

              v.

               

              CHARLES
      E. HURWITZ, MAXXAM INC., and FEDERATED DEVELOPMENT COMPANY,

               

              Defendants.

            	
              §

              §

              §

              §

              §

              §

              §

              §

              §

              §

              §

              §

            	
               

               

              CIVIL
      ACTION NO. H-95-3956

               

              Judge
      Lynn N. Hughes

               

            


    

     

    ORDER OF DISMISSAL WITH
PREJUDICE

     

    The
Court, having been advised by counsel that a settlement has been reached,
dismisses this case with prejudice.  This Court retains jurisdiction
to enforce the settlement.

     

     

    
      	 
      	 
      	 
      
	 
      	 
      	
              Lynn
      N. Hughes

            
	 
      	 
      	
              United
      States District Judge

            


    

    


    


    


    


    


    


    


    


    


    EXHIBIT
A