EXHIBIT10.1

**AGREEMENT OF SETTLEMENT,COMPROMISE, AND RELEASEBETWEENAV PARTNERSHIP AND AV DEVELOPMENT CORPORATIONANDCALIFORNIA COASTAL COMMUNITIES, INC., HEARTHSIDE HOMES, INC. AND****HEARTHSIDEHOLDINGS, INC.**

                           Thisagreement of settlement, compromise, and release (“Settlement Agreement”) isentered into as of March 27, 2001 by and between, on the one hand, plaintiffand cross-defendant AV PARTNERSHIP and cross-defendant AV DEVELOPMENTCORPORATION (“AVD Corp.”) (collectively, the “AVP Parties”) and, on the otherhand, defendant and cross-complainant CALIFORNIA COASTAL COMMUNITIES, INC.,(“CCC”) and cross-complainants HEARTHSIDE HOMES, INC., (“Homes, Inc.”) andHEARTHSIDE HOLDINGS, INC. (“Holdings, Inc.”) (collectively, the “CCC Parties”)[the AVP Parties and the CCC Parties each individually are referred to as“Party” and collectively are referred to as the “Parties”] with FS EquityPartners III, L.P., a Delaware limited partnership, in its capacity as theholder of the Secured Promissory Notes (as hereinafter defined) made by AVPartnership (in such capacity “FSEP”), joining in solely for the limitedpurposes set forth in Section 2.8 hereof.

                           ThisSettlement Agreement is entered into with reference to the following facts:

                           A.         On or about October 28, 1994, CCC(formerly known as Koll Real Estate Group, Inc.) and Holdings, Inc. formerlyknown as Kathryn G. Thompson Company, Inc., a Delaware corporation, executed awritten guarantee with AV Partnership whereby they guaranteed payment andperformance of four promissory notes that Homes, Inc. had executed anddelivered to AV Partnership for the purposes of evidencing its contribution ofits share of equity capital to AV Partnership (“Equity Notes”).  The Equity Notes in the aggregate total FourMillion, Seven Hundred and Seventy-Five Thousand Dollars ($4,775,000) inprincipal amount  and carry interestaccruing at Ten Percent (10%) per annum since the deemed dates of disbursement,all due and payable on or prior to April 4, 1999.

                           B.          The CCC Parties disputedtheenforceability of the written guarantee on the grounds that a certain financialprojection pre-dating the execution of the guarantee should have been, but wasnot, disclosed to them, and had such projection been disclosed, it would havecaused the CCC Parties to not execute the guarantee.  Consequently, the CCC Parties refused to pay the monies due andowing on April 4, 1999.  In order tohave sufficient time to conduct informal negotiations to attempt a voluntaryresolution of this dispute, the Parties extended the due date on the promissorynotes and guarantee to October 31, 1999.

                           C.          Unable to resolve thedispute, onNovember 1, 1999 AV Partnership filed its verified complaint against CCC,*AV**Partnershipv. California Coastal Communities, Inc.* (Case No. BC 219402).  The complaint alleges a single cause ofaction to enforce the collection of the principal and interest due and payableon the four promissory notes pursuant to the written guarantee.

                           D.         On December 2, 1999, CCCanswered AVPartnership’s verified complaint and, together with Homes, Inc. and Holdings,Inc. filed a cross-complaint against AV Partnership and AVD Corp., amongothers.  The cross-complaint containssix causes of action, four of which are brought against the AVP Parties: (1)fraud; (2) rescission of the guarantee; (3) breach of fiduciary duty; and (4)declaratory relief.

                           E.          These matters came onfor a mandatorysettlement conference before the Honorable Owen L. Kwong on January 25,2001.  At that conference, the Partiesreached a settlement and compromise of all the claims asserted in the complaintand cross-complaint, and entered that settlement and compromise on the recordpursuant to California Code of Civil Procedure Section 664.6.

                           F.          The Parties desire to provide for theliquidation, final dissolution and orderly winding up of the business of AVPartnership and desire to dissolve AV Partnership on or prior to December 31,2001.  In connection therewith, theParties have agreed that (i) AVD Corp. shall be the successor-in-interest to,and shall receive all of the Assets (as hereinafter defined) on behalf of, AVPartnership and the AVP Affiliates, and shall assume and undertake to performthe obligations of the AV Partnership and the AVP Affiliates to FSEP pursuantto the Secured Promissory Notes (as hereinafter defined) made payable to FSEPand other FSEP Loan Documents (the “FS Obligations”), and (ii) the CCC Partiesshall assume and undertake to perform all Obligations (as hereinafter defined)of AV Partnership and the AVP Affiliates (other than the FS Obligations and anyFederal or state income taxes that may be payable by AVD Corp., AV DevelopmentCorporation-2, a Delaware corporation (“AVDC-2”) and/or RSB Investment, Inc., aCalifornia corporation (“RSB”) and their respective shareholders and any otherparent Persons thereof (the “AVP Tax Obligations”).

                           G.          In connection with theactivities ofthe AV Partnership, AV Partnership and FSEP entered into that certain LoanAgreement dated as of March 4, 1994 (as amended, the “Loan Agreement”) pursuantto which FSEP agreed to make, from time to time, certain loans (the “Loans”) toAV Partnership and its affiliates, which Loans were evidenced by five securedpromissory notes made payable to the order of FSEP (the “Secured PromissoryNotes”).  The Loans and SecuredPromissory Notes were secured by various deeds of trust, security agreementsand guarantees made by AV Partnership, its general partners and theirrespective affiliates in favor of FSEP as secured party and/or beneficiary (collectively,with the Loan Agreement and the Secured Promissory Notes, the “FSEP LoanDocuments”).  Some or all of theindebtedness and obligations of AV Partnership and its affiliates evidenced byand as set forth in the Secured Promissory Notes and the other Loan Documentsremain outstanding and owing to FSEP.

                           Inconsideration of the mutual promises and respective agreements and conditionscontained in this Settlement Agreement, and intending to be mutually boundthereby, the AVP Parties and the CCC Parties agree as follows:

**             1.          Definitions and Rules of Construction**

                           Asused in this Settlement Agreement, and for the purpose of this SettlementAgreement only, the following terms have the following meanings:

                           **1.1       **“AVP Group” meansAV Partnership, AV Development Corporation, RSBInvestment, Inc. and their past, present, and future employees, officers,directors, principals, parent entities, subsidiaries, affiliates, divisions,joint ventures, agents, servants, shareholders, attorneys, representatives, predecessors,successors, assigns, and acquired entities (including, without limitation, thepast, present, and future employees, officers, directors, principals, parententities, subsidiaries, affiliates, divisions, joint ventures, agents,servants, shareholders, attorneys, representatives, predecessors, successors,and assigns of any such acquired entities), and all Persons acting by, through,under or in concert with any of them, and each of them other than the CCCGroup.

                           **1.2       **“CCCGroup” means California Coastal Communities, Inc., Hearthside Homes, Inc. andHearthside Holdings, Inc. and their past, present, and future employees,officers, directors, principals, parent entities, subsidiaries, affiliates,divisions, joint ventures, agents, servants, shareholders, attorneys,representatives, predecessors, successors, assigns, and acquired entities(including, without limitation, the past, present, and future employees,officers, directors, principals, parent entities, subsidiaries, affiliates,divisions, joint ventures, agents, servants, shareholders, attorneys,representatives, predecessors, successors, and assigns of any such acquiredentities), and all Persons acting by, through, under or in consent with any ofthem, and each of them.

                           **1.3       **“Person” means any individual, corporation,partnership, association, trust, or any other entity (or estate, guardian, orbeneficiary thereof) or organization.

                           **1.4       **“Action” means thecomplaint and cross-complaint filed in the SuperiorCourt of Los Angeles under Case No. BC 219402.

                           **1.5       **“AVP Affiliates”shall mean AVP Partners Corporation, AVP PartnersCorporation-2, Ridge/Meadows, L.P., AV/Sea Country, L.L.C. and Vistas Audubon.

                           **1.6       **“Guarantee” meansthe Third Amended and Restated Guarantee Agreementexecuted by the partners of the AV Partnership and Koll Real Estate Group, Inc.(n.k.a. CCC) and Kathryn G. Thompson Company, a Delaware corporation (n.k.a.Holdings, Inc.), a copy of which is attached as Exhibit “A” to the verifiedcomplaint in this Action.

                           **1.7       **“Equity Notes”means the four Amended and Restated Promissory Notesexecuted by Kathryn G. Thompson Company, a California corporation (n.k.a.Homes, Inc.), copies of which are attached as Exhibits “B,” “C,” “D” and “E” tothe verified complaint in this Action.

                           **1.8       **“Claims”means any past, present, or future actual, threatened, or potential claims,insurance claims, cross complaints, third-party claims, rights, proceedings,demands, requests, suits, law suits, administrative proceedings, causes ofactions, orders, actions, debts, dues, sums of money, accounts, reckonings,bonds, bills, specialties, covenants, contracts, torts, controversies,judgments, executions, liabilities, and obligations whatsoever whether in lawor equity, whether formal or informal, whether in tort or breach of contract,and whether in writing.

                           **1.9       **“Assets” shallhave the meaning set forth in Section 2.4.

                           **1.10    **“Obligation” shall have the meaningset forth in Section 2.6.

                           **1.11    **Rules of Construction: Capitalized terms in this Settlement Agreement shall have theirrespective meanings specified in Section 1 of the Settlement Agreement or asdefined elsewhere in this Settlement Agreement.  The definitions in Section 1 of this Settlement Agreement applyequally to both the singular and plural forms of the terms defined.  The words “shall” and “will” are usedinterchangeably throughout this Settlement Agreement.  The use of either connotes a mandatory requirement and does notconnote a different degree, right, or obligation for either party.  Use of the word “and” shall include in itsmeaning the word “or” and vice versa. Use of the word “any” shall include within its meaning the word “all”and vice versa.

**             2.          Payment and Releases**

             **             2.1       **Each of the undersigned desires to provide for theliquidation, final dissolution and orderly winding up of the business of AVpartnership and hereby agree to dissolve AV Partnership on or prior to December31, 2001.  In connection therewith, theAVP Group and the CCC Group hereby agree that (i) AVD Corp. shall be thesuccessor-in-interest to, and shall receive all of the Assets on behalf of, AVPartnership and the AVP Affiliates, and shall assume and undertake to performthe FS Obligations of AV Partnership and the AVP Affiliates to FSEP pursuant tothe Secured Promissory Notes, and (ii) the CCC Parties shall assume andundertake to perform all Obligations of AV Partnership and the AVP Affiliates(other than the FS Obligations and the AVP Tax Obligations).  The dissolution and distributions shall beaccomplished in the manner set forth herein irrespective of the capitalaccounts of the partners.  Debts andliabilities of AV Partnership shall be paid or provided for in accordance withthese provisions.  All interests inAssets shall be distributed to AVD Corp. and are hereby assigned to AVD Corp.and all Obligations (other than the FS Obligations and the AVP Tax Obligations)are hereby assumed by the CCC Parties. The CCC Parties shall be responsible for all legal fees and other costsfor dissolving, terminating and/or winding up AV Partnership and the AVPAffiliates, provided, that, the CCC Parties shall have no responsibility forthe legal fees and other costs for dissolving, terminating and/or winding upAVD Corp., AVDC-2, RSB and/or their respective shareholder Persons and/or anyother parent Persons thereof.

                           **2.2       **In consideration for thereleases and agreements and covenants containedin this Settlement Agreement, the CCC Parties hereby agree to pay AVPartnership Three Million, Seven Hundred and Fifty Thousand Dollars($3,750,000.00) on or before April 2, 2001, which will be paid by check madepayable to AVD Corp. or its designee.

                           **2.3       **In addition, the Partiesagree to split in equal shares the petty cash and cash on deposit in the AVPartnership cash accounts as of the opening of business on January 25,2001.  The Parties agree that the amounton deposit at that time was Four Hundred and Seventy-Four Thousand, SevenHundred Sixty-Three Dollars and Eighty-Eight Cents ($474,763.88).  Upon the execution of this SettlementAgreement, the CCC Parties shall cause to be issued from the AV Partnershipaccount two checks, each in the amount of Two Hundred and Thirty-SevenThousand, Three Hundred and Eighty-One Dollars and Ninety-Four Cents($237,381.94), one of which shall be made payable to AVD Corp. or its designeeand which shall be delivered to AVD Corp. or its designee on or before April 2,2001, and the other check made payable to Homes, Inc. and which shall bedelivered to Homes, Inc. on or before April 2, 2001.  Interest on said cash accounts of AV Partnership which accrues onthe opening of business on January 25, 2001, through April 2, 2001 shall beretained by and payable to Homes, Inc.

                           **2.4       **Further, except as expresslyprovided in Section 2.3 above or thisSection 2.4 below, all money and other things of value of any kind or characterreceived by the AV Partnership or by any of the AVP Group and/or CCC Group onbehalf of or relating to AV Partnership or the AVP Affiliates after the openingof business on January 25, 2001, in excess of the cash on deposit in the AVPartnership cash accounts at the start of business on that date, shall be thesole and exclusive property of the AVP Parties (collectively, the “Assets”),and the CCC Group hereby:  (i) assign toAVD Corp. or its designee the Assets and all rights to the Assets; and (ii)expressly waive any interest in or Claim to such money or property; and (iii)agree to take or cause to be taken all actions, including the execution of alldocuments, as may be necessary or desirable to effect the foregoing.  The Parties currently understand, but theCCC Parties do not warrant, that such anticipated receipts include, withoutlimitation,

          (1)         Approximately Five Hundred andForty-Eight Thousand, Nine Hundred and Seventy-Seven Dollars and Eighty-ThreeCents ($548,977.83) plus interest minus bank fees and charges on deposit withImperial Bank which serves as collateral for an AV Partnership line of credit;

             (2)         Approximately$70,000 due from Sea Country Homes; and

             (3)         Approximately$25,000 due from the proceeds of the sale to the CCC Parties of the stocks andassets of Hearthside Funding.

Starting on April 2, 2001, and on thefirst business day of every month thereafter until all Assets have beencollected, the CCC Group will remit or cause to be remitted to AVD Corp. or itsdesignee any such monies or other things of value received since the lastdistribution to AVD Corp. or its designee together with an accounting of thesource of all such Assets; provided, that, any interest that accrues on Assetswhich are collected by the CCC Parties from the time of the last distributionuntil the next monthly scheduled distribution shall be retained by and shall bepayable to Homes, Inc. (with the understanding that interest accruing on theImperial Bank deposit identified in Section 2.4(1), minus any bank fees orcharges incurred to maintain said line of credit, and on the Zurich InsuranceCo. premiums identified in Section 2.5 are the sole and exclusive property ofAVD Corp. or its designee). Notwithstanding the foregoing, if, and to the extent that, the CCCParties shall receive a payment on the insurance which is described in Section2.5 below for claims made under the described policies and which relates to areimbursement of actual expenses incurred by the CCC Parties, said paymentsshall be retained by and payable to Homes, Inc.  All checks shall be made payable to AVD Corp. or its designee.

                           **2.5       **TheParties agree that the excess insurance premiums paid by or on behalf of the AVPartnership or the CCC Group and currently held by the Zurich Insurance Co.(which the Parties estimate to be approximately Five Hundred and Forty ThousandDollars ($540,000.00)) including any interest accruing thereon are the sole andexclusive property of AVD Corp. or its designee and the CCC Group does herebyirrevocably transfer and assign all such amounts or rights to AVD Corp. or itsdesignee.  The CCC Parties shall executeall documents and take all other reasonable steps necessary to secure anddeliver payment by Zurich Insurance Co. of those excess premiums to AVD Corp.or its designee.  The CCC Partiesrepresent and warrant that attached as Exhibit A hereto is a true and correctcopy of the irrevocable written instruction and direction by the CCC Parties toZurich Insurance Co. to pay said amounts to AVD Corp. or its designee and thatthey do not presently have knowledge of any fact or reason why Zurich InsuranceCo. would not honor such instruction. The CCC Parties shall take or cause to be taken all other requests orrequirements of Zurich Insurance Co. to effect the payments to AVD Corp. or itsdesignee.  If litigation with ZurichInsurance Co. is needed to obtain these funds, either in whole or in part, theCCC Parties will participate in and prosecute an action at law or equity to itsfinal nonappealable resolution at the direction of the AVP Parties by andthrough attorneys that the AVP Parties will select in their sole discretion;provided that the AVP Parties shall fund the costs of said litigation,including attorneys fees.  In addition,the CCC Parties agree to maintain in place without modification insurancepolicies numbers UMB8321-901-00 and WC8321-903-00 with Zurich to cover thepotential liabilities related to the operations of AV Partnership.

                           **2.6       **From the opening of businesson January 25, 2001 and forever more, theCCC Parties further agree to assume, undertake, perform and be solelyresponsible for, and shall indemnify, defend and hold the AVP Group harmlessfrom, any and all (i) obligations, liabilities, duties, responsibilities,commitments, assessments, taxes (other than the AVP Tax Obligations) and tasksof or relating to AV Partnership and/or the AVP Affiliates, whether nowexisting or hereinafter arising, other than the FS Obligations, without anyset-off, deduction, deferment or reduction of any Asset (collectively, the“Obligations”), and (ii) Claims, known and unknown, whether now existing orhereinafter arising, brought against the AVP Group arising out of or relating tothe AV Partnership and/or AVP Affiliates, including without limitation:

             (1)         All Claims related to or arising fromconstruction defects;

             (2)         AllClaims related to or arising from home purchaser warranties;

             (3)         AllClaims related to or arising from customer service liabilities;

             (4)         AllClaims related to or arising out of the performance or failure to perform anyObligations; and

             (5)         AllClaims relating to or arising out of the business undertaken by the AVPartnership and/or the AVP Affiliates, including without limitation, theacquisition of land, grading of land, and development, construction and salesof homes.

                           Inconnection with the Obligations, the CCC Parties agree to keep or cause to bekept adequate books of account of AV Partnership and the AVP Affiliates.  The AVP Group and their authorizedrepresentatives shall have at all times, during normal business hours, freeaccess to and the right to inspect and copy, at its expense, the books ofaccount.  The CCC Parties shall cause tobe prepared all tax returns and statements, if any, which must be filed onbehalf of AV Partnership, the AVP Affiliates and AV Holdings Corp., a Delawarecorporation and its subsidiaries, for tax years 2000 and 2001 and shall submitsuch returns and statements to the AVP Parties for their approval prior tofiling and, when approved by the AVP Parties, shall make timely filingthereof.  The CCC Parties shall be paida fee of $17,000.00 upon completion of the 2000 tax returns for all of the AVPGroup and a fee of $8,000.00 upon completion of the 2001 tax returns.  In addition, the CCC Parties shall cause tobe furnished to the AVP Parties such additional information regarding thebusiness of AV Partnership and the AVP Affiliates as may be necessary to enablethe AVP Parties to prepare their federal, state and local tax returns.  Each of the CCC Parties and the AVP Partieshereby agrees to use its best efforts to resolve any disputes with respect tothe proposed treatment of any item on a tax return of AV Partnership and/or theAVP Affiliates prior to the required filing date therefor.  The AVP Parties shall be responsible for anyand all costs incurred in obtaining an independent review of the tax returns.

                           **2.7       **In consideration of thepromises contained in this Settlement Agreement, both Parties and each of themagree to dismiss with prejudice, on or before April 6, 2001, the complaint andcross-complaint filed in this Action. Each Party is to bear its own attorneys’ fees, expenses, and all othercosts in connection with the conduct and dismissal of the Action.

                           **2.8       **In consideration of thepromises contained in this Settlement Agreementand the compromise of the amounts due and payable on the Equity Notes andGuarantee, the CCC Group hereby release and forever discharge the AVP Groupfrom any claims, obligations, liabilities or duties, known or unknown,regardless of whether such claims were included in the Action including,without limitation, any and all claims against FSEP.  Likewise, in consideration for the promises contained in thisSettlement Agreement and the payment of the Settlement Sum, the AVP PartiesGroup releases and forever discharges the CCC Group from any claims,liabilities, duties, or obligations, known or unknown, regardless of whethersuch claims were included in the Action except as otherwise expressly providedin this Settlement Agreement.  Further,both Parties and each of them waive any claims for malicious prosecution andabuse of process arising from the filing, prosecution, or defense of this Action.  In consideration of the promises containedin this Settlement Agreement and the payment of the Settlement Sum, FSEP herebyagrees to look solely to AVD Corp. for the payment and performance of the FSObligations and does hereby release and forever discharge the CCC Group fromany claims, liabilities, duties or obligations, known or unknown, relating toor arising out of the Secured Promissory Notes and the other Loan Documents(provided, however, that the foregoing release is not, and shall not be deemedto be, a novation or satisfaction of the indebtedness and obligations evidencedby the Secured Promissory Notes and the other Loan Documents).  To the maximum extent allowed by law, therelease provided in this Section 2.8 to the CCC Group will be void abinitioand will be of no force or effect and the obligations of the CCC Group will beautomatically reinstated if the proceeds obtained by the AVP Group must berestored or returned by the AVP Group as a preference, fraudulent conveyance orotherwise under any bankruptcy, insolvency or similar law by or on behalf ofany of the CCC Group.

                           **2.9       **EachParty represents, warrants, and agrees that it is the sole and lawful owner ofall rights, titles, and interests in and to every claim or matter released herein;and has not assigned or transferred or purported to or attempted to assign ortransfer to any person or entity any claim or other matter related herein.  A Party shall defend, indemnify and hold theother Party harmless from any and all claims arising out of or relating to anyassignment or transfer and any purported or attempted assignment or transfercontrary to the terms of this paragraph.

                           **2.10    **It is the intention of the Parties that theforegoing releases shall beeffective as a bar to all matters released herein.  In furtherance, and not in limitation, of such intention thereleases described herein shall be, and shall remain in effect as, full andcomplete releases, notwithstanding the discovery or existence of any additionalor different claims or facts.  Tofurther effectuate this intention, both Parties and each of them hereby waivesany rights under California Civil Code Section 1542 for any and all mattersreleased herein.  California Civil CodeSection 1542 reads as follows:

AGENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW ORSUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IFKNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

In waiving the provisions ofSection 1542 of the California Civil Code, the Parties acknowledge thatthey may hereafter discover claims or facts in addition to or different fromthose which they now believe to be true with respect to the subject matter ofthe Action and other matters released herein, but agree that they have takenthat possibility into account in reaching this Settlement Agreement and thatthe releases given herein shall be and remain in effect as full and completereleases notwithstanding the discovery or existence of such additional ordifferent claims or facts, as to which each Party expressly assumes the risk.

                           **2.11    **Notwithstanding paragraph 2.10 above, nothingin said paragraph isintended to waive or modify and shall not be deemed to be a waiver ormodification of the Party’s respective rights, remedies or obligations underthis Settlement Agreement.  Further,nothing in this instrument shall limit the right of any Party to enforce theterms of this Settlement Agreement. Accordingly, pursuant to California Code of Civil Procedure Section664.6, the Parties request, and hereby agree and stipulate to, the Court'sretention of jurisdiction to enforce the terms of the Settlement Agreementuntil performance in full of its terms.

                           **2.12    **Nothingin this Settlement Agreement is or should be construed to be an acknowledgementor admission by CCC that it is liable with respect to Persons not a party tothis Settlement Agreement for the business of the AV Partnership or HearthsideHomes, Inc.  CCC’s joint and severalliability and duty to defend and indemnify as provided in Sections 2.3, 2.4,2.5 and 2.6 of this Settlement Agreement do not create or confer any benefit onPersons not a party to the Settlement Agreement, but are solely and exclusivelyfor the benefit of the AVP Group.  Further,these provisions (1) do not reflect any obligation to the AV Partnership thatCCC had prior to the date of the Settlement Agreement; and (2) do not createany obligation or duty to Persons not a party to this Settlement Agreement thatdid not previously exist between CCC and that Person prior to the date of theSettlement Agreement.

**             3.          Other Terms and Conditions**

                           **3.1       **In consideration of themutual promises set forth in this SettlementAgreement, the Parties have agreed to settle all Claims strictly as a businessaccommodation unrelated to the merits of the respective Claims of theParties.  The Parties represent, warrantand agree that neither the execution of this Settlement Agreement nor theprovision of any consideration pursuant thereto is intended as, nor shall it beconstrued or referred to in any way as, an admission of the liability orresponsibility at any time or for any purpose whatsoever, including as anadmission of the truth of the allegations, interpretations, claims, orcontentions of either Party.

                           **3.2       **The Parties agree that thisSettlement Agreement has been negotiated atarm’s length by parties of equal bargaining power, each of whom was representedby competent counsel of its own choosing. Accordingly, it is acknowledged that each Party, with the assistance ofcompetent counsel, has participated in the drafting of this SettlementAgreement, and that any ambiguity should not be construed for or against anyParty on account of such drafting.  TheParties further acknowledge that the obligations and releases herein describedare in good faith and are reasonable in the context of the matters released.

                           **3.3       **Exceptas required pursuant to corporate securities laws, the existence of thisSettlement Agreement and the terms and conditions of this Settlement Agreementare confidential and shall not be disclosed by either Party to any Personunless, upon advice of counsel, either Party or both are compelled or requiredby applicable law; provided, that the foregoing shall not preclude a party fromdiscussing this Settlement Agreement or disclosing the contents thereof to saidParties’ accountants, lawyers, lenders, advisors, and others who may have areason to know, each of whom shall be bound by the confidentiality provisionsof this Settlement Agreement.  Theprovisions of this Section 3.3 shall not, however, include any informationwhich either (a) is demonstrated by a Party to have been independentlydeveloped by said Party (or independently developed by a third party, andlawfully disclosed to said Party) and is in said Party’s possession prior tothe disclosure by the other Party, (b) is or becomes part of the general publicor industry knowledge, other than as a result of said Party’s violation of thisSettlement Agreement, or (c) has been disclosed by said Party followingapproval by the other Party.  Prior toany disclosure compelled or required by applicable law, the disclosing Partyshall to the extent possible provide notice to the nondisclosing Party in timesufficient for the nondisclosing Party to seek a protective order.  Attached as Exhibit B is a draft ofdisclosure to be included in CCC’s Annual Report and Form 10-K.  Furthermore, this agreement will be filed asan exhibit to CCC’s Form 10-K.  TheParties agree that disclosure (not legally compelled or required) shall be amaterial breach of the Settlement Agreement and cause irreparable harm to thenondisclosing Party, and that the nondisclosing Party may seek equitable, aswell as legal, relief to enforce this provision provided, that, the terms andprovisions of Section 2 of this Settlement Agreement shall not be altered oramended in any fashion.  Further,nothing herein prohibits a Party from disclosing the Settlement Agreement to acourt of competent jurisdiction in an action to enforce the terms andconditions of the Settlement Agreement.

                           **3.4       **No amendment, modification,addendum, or revision of this SettlementAgreement shall be valid unless it is in writing and signed by the Party orParties to be bound, in which event there need be no separate considerationtherefor.

                           **3.5       **No waiver or indulgence ofany breach or series of breaches of thisSettlement Agreement shall be deemed or construed as a waiver of any otherbreach of the same or any other provision hereof or affect the enforceabilityof any part or all of this Settlement Agreement, and no waiver shall be validunless executed in writing by the waiving Party.

                           **3.6       **This Settlement Agreementshall be subject to any statute or rule ofcourt that restricts or prohibits the admission into evidence of any offer oragreement to compromise. Notwithstanding the foregoing sentence, this Settlement Agreement may beadmitted into evidence in any action to enforce its terms or secure itsbenefits.

                           **3.7       **The Parties represent,warrant, and agree to execute all documents and todo all things necessary to fully effectuate the terms of this SettlementAgreement.

                           **3.8       **Each Party to thisSettlement Agreement agrees to bear its own costs,expenses and attorneys’ fees with respect to all matters encompasses in theAction and with respect to the negotiation and drafting of this SettlementAgreement.

                           **3.9       **This Settlement Agreementmay be executed in any number of counterparts,each of which shall be deemed to be an original and all of which together shallbe deemed one and the same instrument. However, this Settlement Agreement is not and shall not be effectiveunless and until each Party executes the original or a counterpart.

                           **3.10    **The Parties represent, warrant and agree thatthis Settlement Agreementshall bind them and each of their personal and legal representatives,successors, assigns, executors and administrators, and all other Persons whomay claim under or through them and shall inure to the benefit of each Partyreleased herein, and to their personal and legal representatives, successors,assigns, executors, and administrators, and all other Persons who may claimunder or through them.

                           **3.11    **This Settlement Agreement shall be deemedmade and entered into in theState of California, and shall in all respects be governed, enforced, andconstrued in accordance with the laws of the State of California.

                           **3.12    **Each Party acknowledges and represents thatit has fully and carefullyread this Settlement Agreement prior to execution; that it has been fullyapprised by its attorneys of the legal effect and meaning of this document andall terms and conditions hereof; that it has had the opportunity to makewhatever investigation or inquiry it deemed necessary or appropriate in connectionwith the subject matter of this Settlement Agreement; that it has been affordedthe opportunity to negotiate as to any and all terms hereof; and that it isexecuting this Settlement Agreement voluntarily, free from any undue influence,coercion, duress, or menace of any kind.

                           **3.13    **TheParties represent, warrant, and agree that this Settlement Agreement containsthe entire Settlement Agreement between the Parties; that this SettlementAgreement supersedes any and all prior agreements or understandings relating tothe comprise that is the subject matter of this Settlement Agreement betweenthe Parties; that the terms of this Settlement Agreement are contractual andnot a mere recital; that in executing this Settlement Agreement, no Party isrelying on any statement or representation made by the other Party, or theother Party’s agents, servants, or attorneys concerning the subject matter,basis, or effect of this Settlement Agreement other than as set forth herein;and that each Party is relying solely on its own judgment and knowledge.

                           **3.14    **The Parties shall not use the documentsproduced by the other party (forwhich said Party did not already have a copy) and depositions taken during thecourse of litigation of the Action for any purpose without the written consentof the other Party.  Each Party agreesto destroy or cause to be destroyed all copies of documents produced by theother Party and that within thirty (30) days of executing the SettlementAgreement counsel for each party shall send written confirmation that thosedocuments have been destroyed.  Copiesof the documents attached as exhibits to depositions are excluded from theobligation to destroy such documents; provided however, that all deposition transcriptsand their exhibits will be kept confidential if not destroyed.

                           **3.15    **Itis the express intention of all Parties hereto that this Settlement Agreementshall not create in or convey to any Person who or which is not a Party to thisSettlement Agreement any rights against the AVP Parties or the CCC Parties.

                           **3.16    **Each of the undersigned further declares andrepresents that he or she iscompetent to execute this instrument and that he or she is duly authorized, andhas the full right and authority, to execute this Settlement Agreement onbehalf of the Party for whom he or she is signing.

                           **3.17    **If a provision of this Settlement Agreementor the application thereof isheld invalid or unenforceable, its invalidity or unenforceability shall notaffect any other provisions or applications of this Settlement Agreement, andsuch other provisions or applications shall be given effect without the invalidor unenforceable provision or application, and to this end the SettlementAgreement is deemed to be severable.

                           **3.18    **The representations, warranties, agreements,and promises made by eachParty to this Settlement Agreement and contained herein shall survive theexecution of this Settlement Agreement.

             INWITNESS WHEREFORE, this Settlement Agreement has been read and signed induplicate originals by the duly authorized representative of the Parties as ofthe date first above written.

| AV  PARTNERSHIP                   |
|-----------------------------------|
| By:                               | AV  Development Corporation |
|                              | Its  General Partner |
|                              | By: | /s/  WILLIAM M. WARDLAW |
|                              | Name: | William  M. Wardlaw |
|                              | Title: | President |
|                              | Date: |  |
|                              |   |   |
| By:                               | RSB  Investment, Inc. |
|                              | Its  General Partner |
|                              | By: | /s/  ROBERT S. BENNETT |
|                              | Name: | Robert  S. Bennett |
|                              | Title: | President |
|                              | Date: | 3/30/01 |
|                              |   |   |
| By:                               | Hearthside  Homes, Inc. |
|                              | By: |  /s/ RAYMOND J. PACINI |
|                              | Name: | Raymond  J. Pacini |
|                              | Title: | CEO |
|                              | Date: | 3/29/01 |
|                              |   |   |
| AV  DEVELOPMENT CORPORATION, INC. |
| By:                               | /s/  WILLIAM M. WARDLAW |
|                              | Name: | William  M. Wardlaw |
|                              | Title: | President |
|                              | Date |  |
|                              |   |   |