**Exhibit 10.1**

** **

**AMENDED AND RESTATEDINDEPENDENT CONTRACTOR CONSULTING AGREEMENT**

 

ThisAMENDED AND RESTATED INDEPENDENT CONTRACTOR CONSULTING AGREEMENT (“Agreement”)is entered into as of October 1, 2002 between California Coastal Communities,Inc., a Delaware corporation (the “Company”) and GSSW-REO, L.L.C., a Texaslimited liability company (“GSSW”).

 

**WHEREAS,** the Company and GSSW initiallyentered into an Independent Contractor Consulting Agreement dated as of May 20,1998, an Extension and Modification of Independent Contractor ConsultingAgreement dated as of December 7, 1999 and a Second Extension andModification of Independent Contractor Consulting Agreement dated as of April30, 2001 (collectively, the “Prior Agreement”) through which GSSW has providedvarious consulting capacities to the Company and the Company has obtainedvarious consulting services by GSSW; and

 

**WHEREAS,** the Company andGSSW have agreed to amend and restate, in its entirely, the Prior Agreement byexecuting and delivering this Agreement to memorialize the terms and conditionsof the above described relationship.

 

**NOW, THEREFORE,** in considerationof the foregoing and the mutual covenants and obligations set forth herein, theparties hereto, intending to be legally bound, hereby agree as follows:

 

1.             Term.  The Company agrees to engage GSSW and GSSWagrees to provide consulting services to the Company, in accordance with theterms of this Agreement, until April 30, 2003, subject to further extensions,if any.

 

2.             Consulting Services.  GSSW hereby agrees to designate Thomas W.Sabin as its representative to provide the consulting services (“Consultant”),on a non-exclusive basis, which consulting services to the Company, includingwithout limitation the following:

 

•                                            developing andimplementing a strategic plan for the Company, consistent with the directivesestablished by the Company’s Board of Directors;

 

•                                            reviewing andcommenting on individual development projects and strategic opportunities,including without limitation, financing and equity structures applicablethereto;

 

•                                            assisting inanalysis of alternative approaches to maximizing the value of the Company’sbusiness and opportunities;

 

•                                            providingmotivational advice and counsel to the Company’s staff; and

 

•                                            assisting insourcing new and continuing development opportunities for the Company andprocuring staff to support such opportunities.

 

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3.             Independent Contractor Status.  This Agreement is not intended to be anemployment agreement and there does not exist any intent to create anyemployment relationship between the Company, GSSW or Consultant.  At all times during the term of thisAgreement, GSSW shall be an independent contractor as the consulting servicesare rendered through Consultant.  GSSWshall be solely responsible for all federal, state and local taxes,withholdings and related obligations which may arise from any payments from theCompany to GSSW hereunder, and, except for the amounts to be paid pursuant tothe terms of Sections 5 and 14 below, Company shall not be liable orresponsible for any payment whatsoever to GSSW or Consultant, including withoutlimitation, any federal and state income tax obligations and contributions tosocial security, disability and workers’ compensation insurance benefits.  GSSW agrees that GSSW will indemnify, defendand hold the Company harmless from and against any and all claims or liabilityarising out of or in connection with any alleged failure by GSSW to satisfy anysuch obligations.

 

4.             Compensation. Until April30, 2003, the Company hereby agrees to pay GSSW compensation at the monthlyrate of Ten Thousand Dollars ($10,000.00).

 

5.             Termination.  This Agreement may be terminated by eitherparty, without cause, upon thirty (30) days prior written notice.Notwithstanding the foregoing, GSSW shall not be terminated for cause unlessand until GSSW has received written notice of a proposed termination for causeand GSSW has had an opportunity to be heard before at least a majority of thenumber of members of the Board of Directors of the Company authorized to takesuch action.  GSSW shall be deemed tohave had such an opportunity if given written notice of telephonic notice byany director at least three (3) business days in advance of a meeting of theBoard of Directors of the Company called for the purpose of such hearing.

 

6.             Entire Agreement.  This Agreement contains the entire agreementbetween the parties with respect to the subject matter hereof.  This Agreement supersedes any and all prioragreements and understandings between the parties hereto respecting the subjectmatter hereof.

 

7.             Changes.  The terms and provisions of this Agreementmay not be modified or amended except pursuant to the written consent of theGSSW and of the Company.  The waiver byeither party of any breach of any provision of this Agreement by the otherparty shall not operate or be construed as a waiver of any subsequent breach.

 

8.             Assignability.  The obligations of GSSW may not be delegatedby GSSW or Consultant and the designation of the Consultant shall not bechanged without the prior written consent of the Company, which consent may bewithheld by the Company in its sole and absolute discretion.  Any such attempted delegation or changeshall be null and void abinitio and without effect.  This Agreement and all of the Company’srights and obligations hereunder may be assigned or transferred by the Companyto, and shall be binding upon and inure to the benefit of, any subsidiary ofthe Company or any successor to the Company.

 

9.             Notices.  All notices, requests, consents and othercommunications hereunder to either party shall be deemed to be sufficient ifcontained in a written instrument delivered in person, duly sent by first classregistered or certified airmail, postage prepaid, or telecopied or telexedaddressed to such party at his or its address as set forth below.  All such notices, requests, consents andcommunications shall be deemed to have been delivered (a) in the case ofpersonal delivery, on the date of such delivery, (b) in the case of telexor facsimile transmission, on the date on which the sender receives machineconfirmation of such transmission, and (c) in the case of mailing, on the

 

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fifth(5th) business day following the date of such mailing.  Either party may change the address to whichnotices, requests, consents and other communications hereunder shall be sent bysending written notice of such change of address to the other party.

 
| If  to the Company: |   | California  Coastal Communities, Inc. |
|---------------------|--------|---------------------------------------|
|                |   | 6  Executive Circle, Suite 250        |
|                |   | Irvine,  California 92614             |
|                |   | Attention:  Raymond J. Pacini    |
|                |   | Telephone:  (949) 250-7781            |
|                |   | Facsimile:  (949) 261-6550       |

 
| If  to GSSW and/or Consultant: |   | GSSW,  REO, L.L.C.              |
|--------------------------------|--------|---------------------------------|
|                           |   | Lincoln  Plaza                  |
|                           |   | 500  N. Akard, Suite 328        |
|                           |   | Dallas,  Texas  75201      |
|                           |   | Telephone:  (214) 954-8701      |
|                           |   | Facsimile:  (214) 954-8704 |

 

10.           Governing Law.  This Agreement shall be governed by, andconstrued in accordance with, the laws of the state of California, withoutregard to the conflicts of law provisions thereof.  While governed by the laws of the state of California, GSSW andConsultant shall be deemed to perform this Agreement and the servicescontemplated by this Agreement in and from the state of Texas, in which bothGSSW and Consultant shall be and remain resident and domiciled for purposes ofthis Agreement.  In no event shall theperformance of the consulting service by GSSW require either GSSW or Consultantto be or become resident or domiciled in the state of California.

 

11.           Counterparts.  This Agreement may be executed in any numberof counterparts, and each such counterpart shall be deemed to be an originalinstrument, but all such counterparts together shall constitute but oneagreement.

 

12.           Headings.  The headings of the various sections of thisAgreement have been inserted for convenience of reference only and shall not bedeemed to be part of this Agreement.

 

13.           Severability.  Any provision of this Agreement that isprohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,be ineffective to the extent of such prohibition or unenforceability.  Such prohibition or unenforceability in anyone jurisdiction shall not invalidate or render unenforceable such provision inany other jurisdiction.  Any provisionof this Agreement that is prohibited or unenforceable by reason of its temporalduration or geographical scope shall be deemed to be changed to the longestduration and widest geographical scope that is enforceable.

 

14.           Expenses. GSSW shall bereimbursed for all reasonable out-of-pocket expenses incurred incident to theperformance of the consulting services of GSSW contemplated by this Agreementsuch as travel, hotel, telephone and similar expenses, subject to delivery ofan itemized invoice therefor.

 

15.           Representations and Warranties ofGSSW.  GSSW hereby represents,warrants and agrees to the following:

 

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(a)  None of the payments thatwill be made by the Company to GSSW under this Agreement and/or the PriorAgreement (“Payments”) during this calendar year, any subsequent calendar yearor during any of the past three (3) calendar years will exceed or has exceeded(i) 5% of GSSW entities' consolidated gross revenues during such calendar year;or (ii) $200,000, whichever is greater (“Excess Payment”).  In the event that any Excess Payment shouldbe determined to exist, GSSW agrees to promptly remit to the Company the amountof such Excess Payment.

 

(b)  The Payments received byGSSW are deposited into its general accounts and are not paid or otherwisedistributed to Consultant, and Consultant is not paid a bonus or otherwisefinancially rewarded by virtue of the consulting services he performs on GSSW’sbehalf pursuant to this Agreement.

 

 

**IN WITNESSWHEREOF,** the parties hereto have executed this Agreement as ofthe date first above written.

 
|   |   | CALIFORNIA  COASTAL COMMUNITIES, INC. |
|--------|--------|---------------------------------------|
|   |   |                                  |   |
|   |   |                                  |   |
|   |   | By                                    |  /s/ Raymond J. Pacini |
|   |   |                                  | Raymond  J. Pacini |
|   |   |                                  | Chief  Executive Officer |

 

 
|   |   | GSSW-REO,  L.L.C.,                 |
|--------|--------|------------------------------------|
|   |   | a  Texas limited liability company |
|   |   |                               |   |
|   |   |                               |   |
|   |   | By                                 |  /s/ J. Kevin Rucker |
|   |   |                               | Name:  J. Kevin Rucker |
|   |   |                               | Title:  Manager of Financial Operations |

 

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