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SETTLEMENT AND RELEASE AGREEMENT 

This Settlement and Release Agreement ("Agreement'') is made by, between, and among 

the following undersigned parties: 

The Plaintiff Federal Deposit Insurance Corporation as Receiver for Colonial Bank 

("FDIC-R") and Crowe Horwath LLP ("Settling Defendant") (individually, the FDIC-Rand the 

Settling Defendant may be referred to herein as "Party" and collectively as the "Parties"). 

RECITALS 

WHEREAS: 

Prior to August 14, 2009, Colonial Bank ("Bank") was a depository institution organized 

and existing under the laws of the State of Alabama. 

On August 14, 2009, the Alabama State Banking Department closed the Bank and, 

pursuant to 12 U.S.C. § 1821(c), the Federal Deposit Insurance Corporation was appointed 

Receiver. 1n accordance with. 12 U.S.C. § 1821(d), the FDIC-R succeeded to, among other 

things, all rights, titles, powers, and privileges of the Bank, including those with respect to its 

assets. 

Among the assets to which the FD1C-R succeeded were all of the Bank's claims, 

demands, and causes of action against the Bank's former professionals arising from the 

perfonnance, nonperformance, and manner of perfonnance of their respective functions, duties, 

and acts as professionals for th.e Bank. 

On October 3 1, 2012, the FDIC-R filed a complaint for money damages against, among 

others, the Settling Defendant, who provided outsourced internal auditing services and 

documentation and testing services related to Sarbanes-Oxley Section 404 compliance, both 

pursuant to a series of engagement letters with the Bank's holding company (the "Services"). 
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Those claims for damages are now peuding in the United State District Court for the Middle 

District of Alabama in Federal Deposit Insurance C01poration as Receiver for Colonial Bank v. 

PricewaterhouseCoopers LLP and Crowe Horwath LLP, Case No. 2:12-cv-00957-BJR 

("Action"). The Settling Defendant denies liabj]jty for tbe claims. 

The undersigned Parties deetn it in their best interests to enter into this Agreement to 

avoid the uncertainty and expense of further litigation. 

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: 

SECTION I: Payment to FDJC-R 

A. As an essential covenant and condition to this Agreement, the Settling Defendant 

shall pay the FDIC-R the sum of $60,000,000.00 ("Settlement Payment") on or before April 30, 

2018. 

B. The Settlement Payment to the FDIC-R shall be made by direct wire transfer into 

an account designated by the FDIC-R by written notice to the attorneys for the Settling 

Defendant. In the event that the FDIC-R does not receive the Settlement Payment by the date 

determined by Section I.A. above, interest shall accrue on the unpaid installments, from the date 

detennined in Section l A. above until the date of payment, at a rate equal to I% over LIB OR ( as 

determined on the date payment is due). 

C. If the FDIC-R does not receive the Settlement Payment in fu11 on or before the 

date determined by Section I.A above, then the FDIC-R, in its sole discretion, shall have the right 

at any time prior to receipt of the Settlement Payment in full (including all accrued interest) to: 

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I. Extend the pe1iod of time for the Settlement Payment, including interest 

accruing from the date detennined by Section I.A. above, through the date of payment at a rate 

calculated in accordance with Section l.B.; or 

2. Enforce this Agreement, in which event tbe Settling Defendant agrees to 

jurisdiction in the United States District Comt for the Middle District of Alabama and to pay all 

of the FDIC-R's reasonable attorneys' fees and costs expended in enforcing the terms of this 

Agreement; or 

3. Terminate the Agreement, move to vacate any dismissal order, to which 

the SetOing Defendant agrees to consent, and re-institute an action on the FDIC-R's claims. The 

Settling Defendant further agrees to waive any defense based on any statute of limitations that 

would bar any of the FDIC-R's claims, insofar as that defense is based, in whole or in part, on 

the passage of time between the dismissal of the Action and the reinstitution of an action on the 

FDIC-R's claims. The Settling Defendant further agrees (a) to waive all objections, defenses, 

claims or counterclaims, and (b) to covenant and agree not to assert any objections, defenses, 

claims or counterclaims, in both cases to the extent such objections, defenses, claims or 

counterclaims did not exist or were otherwise unavailable as of the date this Agreement was fully 

executed; and/or 

4. Seek any other relief available to it in law or equity. 

Any extension of time under Section T.C.1 for delivery of the Settlement Payment or 

acceptance of a portion of the Settlement Payment shall not prejudice the FDIC-R's rights to take 

any of the actions set forth in Section I.C.2 through I.C.4 at any time prior to receipt of the 

Settlement Payment in full (including all accrued interest). 

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SECTION ll: Dismissal 

Within ten (] 0) business days after the receipt of the Settlement Payment in full, 

plus any accrued interest, the FDIC-R shall move for entry of an order dismissing with prejudice 

all claims in the Action against the Settling Defendant, in the form attached hereto as Exhibit A. 

SECTION Ill: Releases 

A. The FDIC-R's Releases. 

Upon receipt of the Settlement Payment in full as provided in Section I, and except as 

provided in Section 111.C., the FDIC-R, for itself and its successors and assigns, hereby releases 

and discharges the Settling Defendant, and its heirs, parents, subsidiaries, affiliates, principals, 

employees, officers, directors, agents, executors, trustees, administrators, representatives, 

partners, insurers, successors and assigns, from any and all claims, demands, obligations, 

damages, actions, and causes of action, direct or indirect, in law or in equity, belonging to the 

FDIC-R, that arise from or relate to the Bank or the Settling Defendant's performance, 

nonperfonnance, or manner of performance of the Services, including without limitation the 

causes of action alleged in the Action. 

B. The Settling Defendant's Release. 

Effective simultaneously with the release granted in Sec6on III.A above, the Settling 

Defendant, on behalf of itself, and its respective heirs, parents, subsidiaries, affiliates, plincipals, 

employees, officers, directors, executors, trustees, administrators, agents, representatives, 

attorneys, partners, insurers, successors and assigns, hereby releases and discharges the FDTC-R, 

and its employees, officers, directors, representatives, attorneys~ successors and assigns, from 

any and all claims, demands, obligations, damages, actions, and causes of action, direct or 

indirect, in law or in equity, that arise from or relate to the Bank or the Settling Defendant's 

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performance, nonperformance, or manner of perfonnaoce of the 

Services, including without limitation the causes of action aJleged in the Action. 

C. Exceptions from Releases by FDIC-R. 

1. Notwithstanding any other provision of this Agreement, the FDIC-R does 

not release, and expressly preserves fully and to the same extent as if this Agreement had not 

been executed, any claims or causes of action: 

a. Against the Settling Defendant or any other person or entity for 

liabiHty, if any, incurred as the maker, endorser, or guarantor of any promissory note or 

indebtedness payable or owed by them to the FDIC-R, the Bank, other financial institutions, or 

any other person or entity, including without limitation any such c1aims acquired by FDIC-R as 

successor in interest to the Bank or any person or entity other than Bank; and 

b. Against any person or entity not expressly released by the FDIC-R 

in this Agreement. It is expressly and specifically understood and agreed between the Parties 

hereto that this is aprotanto release of the Settling Defendant, and its heirs, parents, subsidiaries, 

affiliates, principals, employees, officers, directors, agents, executors, trustees, administrators, 

representatives, partners, insurers, successors and assigns and inures to their benefit only. This 

pro tanto release does not release any other individual or entity, including the remaining 

defendant PricewaterhouseCoopers, LLP in the Action, and the FDIC-R specifically reserves any 

and all causes of action which it may have against PricewaterhouseCoopers, LLP. Furthermore, 

the Parties expressly understand and agree that such pro tanto release and discharge is not an 

adjudication of any of the matters at issue in the Action. 

2. Notwithstanding any other provision of this Agreement, nothing in this 

Agreement shall be construed 01· i11terpreted as limiting, waiving, releasing, or compromising the 

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jurisdiction and authority of the Federal Deposit Insurance Corporntion in the exercise of its 

supervisory or regulatory authority or diminishing its ability to institute administrative 

enforcement or other proceedings seeking removal, prohibition, or any other relief il is 

authorized to seek pursuant to its supervisory or regulatory authority against any person. 

3. Notwithstanding any other provision of this Agreement, this Agreement 

does not purport lo waive, or intend to waive, any claims that could be brought by the United 

States through the De_pa1tment of Justice, the United States Attorney's Office for any federal 

judicial district, or any other department or agency of the United States as defined by 18 U.S.C. 

§ 6. In addition, the FDIC-R specifically reserves the right to seek court-ordered restitution 

pursuant to the relevant provisions of the Mandatory Victims Restitution Act, 18 U .S.C. §§ 3322 

and 3663 et seq., if appropriate. 

SECTION IV: Waiver of Dividends and Proceeds from Litigation 

To the extent, if any, that the Settling Defendant is or was a shareholder of the Bank or its 

holding company and by virtue thereof is or may be entitled to a dividend, payment, or other 

distribution upon resolution of the receivership of the Bank or proceeds in any litigation that has 

been or could be brought against the Federal Deposit Insurance Corporation in any capacity or 

against the United States based on or arising out o.f: in whole or in part, the closing of the Bank, 

or any alleged acts or omissions by the Federal Deposit h1surance Corporation in any capacity, 

the United States government, or any agency or department of the United States government in 

connection with the Bank, its conservatorship, or receivership, the Settling Defendant hereby 

knowingly assigns to the FDIC-R any and all rights, titles, and interest in and to any and all such 

dividends, payments, other distributions, or proceeds. 

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SECTION V: Representations and Acknowledgements 

A. Authorized Signatories. All of the undersigned persons represent and warrant that 

they are Parties hereto or are authmized to sign this Agreement on behalf of the respective Party, 

and that they have the ful] power and authority to bind such Party to each and every provision of 

tbis Agreement. This Agreement shall be binding upon and inure to the bei1efit of the 

undersigned Parties and their respective heirs, executors, trustees, administrators, representatives, 

successors and assigns. 

B. Advice of Counsel. Each Party hereby acknowledges that it has consulted with 

and obtained the advice of counsel prior to executing this Agreement, and that this Agreement 

has been explained to that Party by its counsel 

SECTION VI: Reasonable Cooperation 

A. The Parties agree to cooperate in good faith to effectuate all the tenns and 

conditions of this Agreement, including doing, or causing their agents and attorneys to do, 

whatever is reasonably necessary to perfonn the terms of tbis Agreement. 

SECTION VU: Other Matten 

A. No Admission of Liability. The undersigned Parties each acknowledge and agree 

that the matters set forth in this Agreement constitute the settlement and compromise of disputed 

claims and defenses, that this Agreement is not an admission or evidence of liability or infirmity 

by any of them regarding any claim or defense, and that the Agreement shall not be offered or 

received in evidence by or against any Party except to enforce its terms. 

B. Execution in Countemarts. This Agreement may be executed in counterparts by 

one or more of the Parties and an such counterparts when so executed shall together constitute 

the final Agreement, as if one document had been signed by all Parties; and each such 

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counterpart, upon execution and delivery, shall be deemed a complete original, binding the 

Parties subscribed thereto upon the execution by all Parties to this Agreement. 

C. Choice of Law. This Agreement shall be interpreted, construed, and enforced 

according to applicable federal law, or in its absence, the laws of the State of Alabama. 

D. Notices. Any notices required hereunder shalJ be sent by registered mail, first 

class, return receipt requested, and by email, to the following: 

If to the FDIC-R: 

Gregory K. Conway 

Counsel, Federal Deposit Jnsurance Corporation 

3501 Fairfax Drive, VS-B-7046 . . . . 22226 

If to the Settling Defendant: 

E. 

Attn: Legal Department 

Crowe Horwatl1 LLP 

One Mid America Plaza, Suite 700 

Brook, Illinois 60522-3697 

Entire Agreement and Amendments. This Agreement constitutes the entire 

agreement and understanding between and among the undersigned Parties concenung the matters 

set forth herein and supersedes any prior agreements or understandings. This Agreement may 

not be amended or modified, nor may any of its provisions be waived, except in writing signed 

by the Parties bound thereby, or by their respective authorized attomey(s) or other 

representative(s). 

F. Titles and Captions. All section titles and captions contained in this Agreement 

are for convenience only and shall not affect the interpretation of this Agreement. 

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0. No ConfidentiaLity. The undersigned Parties acknowledge that this Agreement 

shall not be confidential and will be disclosed pursuant to the Federal Deposit Insurance 

Corporation's applicable policies, procedures, and other legal requirements. Similarly, Crowe 

may disclose this Agreement as required by law or as it deems appropriate in its sole discretion. 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed 

by each of them or their duly authorized representatives on Lhe dates hereinafter subscribed. 

FEDERAL DEPOSIT INSURANCE CORPORATION AS 

RECEIVER FOR COLONIAL BANK 

Date: Of- 03- J. O{ ~ BY: 

TITLE: Counsel 

PRINT NAME: Gregory K. Conway 

CROWE HORWATH LLP 

Date: __ ~_-_2_-_'2._c.)_,_a __ BY: 

TITLE: 

-------- -------

PRINTNAME: F~~ :r ... i~~/LS 

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IN THE UNITED STATES DISTRICT COURT 

FOR THE MIDDLE DISTRICT OF ALABAMA 

NORTHERN DIVISION 

THE COLONIAL BANCGROUP, INC., 

and KEVIN O'HALLORAN, 

Plaintiffs, 

v. 

PRICEWATERHOUSECOOPERS LLP 

and CROWE HORWATH LLP, 

Defendants. 

FEDERAL DEPOSIT INSURANCE 

CORPORATION AS RECEIVER FOR 

COLONIAL BANK, 

Plaintiff, 

v. 

PRJCEWATERHOUSECOOPERS, LLP 

and CROWE HORWATH, LLP, 

Defendants. 

Case No. 2:11-cv-00746-BJR 

Case No. 2:12-cv-00957-BJR 

(PROPOSED] ORDER OF DISMISSAL WITH PREJUDICE WITH 

RESPECT TO CROWE HORWATH LLP 

Pursuant to the Agreed Motion for Entry of Order of Dismissal with Respect 

to Crowe Horwath, LLP ("Crowe"), the CoUJi being fully advised, it is hereby 

ordered, pursuant to Fed. R. Civ. P. 41(a)(2), that: 

1. This action is dismissed with prejudice as to Crowe. 

EXHIBIT A 
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2. This Order does not relate to, release, dismiss or impact the FDIC-R's 

claims and causes of action asserted against PricewaterhouseCoopers, LLP 

("PwC") in this action and the FDIC-R's claims against PwC shall remain pending. 

3. The FDIC-Rand Crowe shall bear their own attorneys' fees and costs 

with respect to any claims, counterclaims and causes of action in this action 

between the FDIC-Rand Crowe. Neither the FDIC-R nor Crowe shall have any 

liability to the other for fees and costs incuned in connection with any other aspect 

of this action. 

Dated this __ day of ___ , 2018. 

EXHIBIT A 

Barbara Jacobs Rothstein 

U.S. District Court Judge