of such claims, or otherwise arise from, relate to or concem the Bond and agrees that any interest
it may have under the Bond is extinguished,

B. Release of FDIC by St. Paul.

Effective simultaneously with the release granted in Paragraph IIL.A. above, St. Paul, for
itself and its successors and assigns, and on bebalf of its parents, subsidiaries, affiliates and
reinsurers, and their successors and assigns, hereby releases and discharges the FDIC and its
employees, officers, directors, agents, representatives, successors and assigns, from any and all
claims, demands, obligations, damages, actions, and canses of action, direct or indirect, in law or
in equity, that arise frorn or relate to the Bank, or that arise from or relate to the Bond including
Dut not limited to any rights of subrogation.

c. Express Reservations From Releases.

L Notwithstanding any other provision, by this Agreement, the FDIC does
not release, and expressly preserves fully and to the same extent as if the Agreement bad not
been executed, any claims or causes of action:

a, against any person or entity for lability, if any, incurred as the
“S.

maker, etidorser or guarantor of any promissory note or indebtedness payable or owed by them to
the FDIC, the Bank, other financial institutions, or any other person or entity, including without
limitation any claims acquired by the FDIC as successor in interest to the Bank or any persen or
entity other than the Bank:

b. against any person or entity not expressly released in this
Agreement; and
&. which are not expressly released in Section IIB, above.



(b)6}

(b)(6)

counsel may hereafter maintain). If more than one method for sending notice as set forth above
is used, the earliest notice date established as set forth above shall control.

BB Choice of Law. This Agreement shalt be interpreted, construed and enforced
according to applicable federal law, or in its absence, the laws of the State of Elorida.

G. Entire Agreement and Amendments. This Agreement constitutes the entire

agreement and understanding between. and among the undersigned parties conceming the matters
set forth herein. 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
attomey(s) or other representative(s}.

HL. Reasonablé Cooperation. 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 perform the
terms of this Agreament.

JN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed

by cach of them or their duly authorized represoutatives on the dates hereinafter subscribed.

ST. PAUL MERCURY INSURANCE COMPANY

Tide. OVP CRG ie
Print Name—T RG CU OG

Date: December. I (s_,2011 By:

03686705

10



c. Cooperation in Relation to the Third Party Claim. At no time will St Paul issue
to the FDIC any subpoenas or other formal requests for documents, information or testimony in
connection with the Third Party Claim, except that St, Paul may, if otherwise appropriate under
applicable law, issue subpoenas for trial testimony to the FDIC in connection with a trial of the
‘Third Party Claim. Notwithstanding the foregoing, in relation to the Third Party Claim, St. Paul
may make reasonable written requests for documents to the FDIC and, in retum, the FDIC will
provide reasonable cooperation. If the Parties disagree regarding the reasonableness of requests
issued by St. Paul to the FDIC or the FDIC’s compliance therewith, the Parties shall endeavor to
confer, orally or in writing, in a good faith effort to resolve by agreement the issues in dispute. If
afer conferring the Partigs are unable to reach a resolution, the parties shall seek resolution from
Judge Layn R. Phillips (Ret.), who shall have the authority to make a final binding decision

regarding the reasonableness of St. Paul’s requests and the sufficiency and reasonableness of the

FDIC’s cooperation.
SECTION V: Representations and Acknowledgaients
A. No Admission of Liability. The undersigned Parties each acknowledge and agree

thai the inutiers set forth in this Agreement constitute the settlement and compromise of a
disputed claim, and that this Agreement is not an admission or evidence of liability by cither of
them regarding any claim wor is it intended to be, nor shall it be constred as, an interpretation of
the Bond or any other insurance policy. This Agreement shall not be ased as evidence, or in any
other manner, before any court or any proceeding to create, prove, or interpret the obligations or
alleged obligations of St. Paul under the Bond to any party or non-party to this Agreement.

Except as provided above, the Parties may use the Agreement in any other proceeding to the



2. Notwithstanding any other provision, this Agreemient does not waive any
claims or actions that could be brought by any agency or instrumentality of the United States
government other than the FDIC.

SECTION IV: Additional Covenants

A. No Additional Third Party Actions. St. Paul hereby agrees thai it will not bring,
file or otherwise pursue any additional claims against any party, in relation to the Bond,
inchiding any claims for indemnity or subrogation, except that, notwithstanding the foregoing,
St. Paul retains all rights to continme to pursue its currently peading Third Party Claim against
Ronald A. Lacayo. Nothing herein shall require or obligate St. Paul to continue io pursuc the
Third Party Claim. é

B. Confidential Materials. For so long as the Third Party Claim remains pending
before the United States District Court for the Southern District of Miami, St. Paul may retain
possession of any and all documents produced to it by the FDIC in connection with the Band;
however, St. Paul shall use such documents solely in connection with the currently pending
Third Party Claim. Further, any documenis produced by the FDIC shall continue to be governed
by‘ithe tds of the Agreed Protective Order entered on December 29, 2008 in the Coverage
Action (the “Protective Order”), Upon the conclusion of the Third Pany Claim, S$ Paul shall
destroy all Confidential Information, as defined in the Protective Order, pursuant to paragraph 7
of the Protective Order. Provided, however, St. Paul may maintain such documents that it has in
its possession that it is required to maintain under its document retention policies, which
documents it will designate as confidential and store subject to notification that they are

confidential.



F. Construction. The descriptive headings of this Agreement are for convenience
only and shall not affect the construction or interpretation of this Agreement.

G. ‘Notices. If any Party is required to give notice to another Party under this
Agreement, such notice shall be (i) delivered personally, (i) sent by Federal Express (or another
recognized overnight or two-day courier) requesting next or second business day delivery, (li)
sent by facsimile, or Gv) sent by United States certified or registered mail, postage prepaid,
return receipt requested. Any such notice shall be deemed given when (i) so delivered
personally, (ii) if sent by express courier, one or twe business days {as the case may be)
following delivery to the courier, (iii) on the date sent by facsimile, with confirmation of
transmission, if sent during normal business hours of the recipient, or, if not, then on the next
business day, or (iv) if Sgnt by certified or registered mail, three business days after the date of
deposit in the United States mail to the respective address of the Party as set forth below, with
copies sent to the persons indicated below:

Ifto the FDIC: Barry §, Rosen
Reed Smith LLP
10 S. Wacker Dr., 40" Flooe
Chicago, IL 60606
Telephone
Facsimile:

es

t Counsel

Federal Deposit Insurance Corporation
3301 North Pairfax Drive, VS-B-7058
Arlington, VA 22226

Telephone: (703) 562-2420

HWito St. Paul: Patricia H. Thompson
Carlton Fields
Miami Tower
100 S.E. Second Street, Suite 4260

(b)(4).(b)
(6)

(b)(4).(b)

Miami, Flori 2114
Telephon
Facsimile,

or to such ather address as the secipient party has specified by prior writien notice to the sending
party (or in the case of counsel, to such other readily ascertainable business address as such

(6)



(b)(4)

SEYTLEMENT AND RELEASE AGREEMENT
‘This Setilemeat and Release Agreement (“Agreement”) is made as of this Sth day of

December, 2011, by, between, and among the following undersigned parties:

Federal Deposit Insurance Corporation, as receiver of Hamilton Bank, N.A. FDIC");

St. Paul Mercury Insurance Company (“St. Paul”) (individually, the FDIC and St. Paul

may be referred to herein as “Party” and collectively as the “Parties”).
RECITALS
WHEREAS:

Prior to Jannary }1, 2002, Hamilton Bank, N.A. (“Bank”) was a depository institution
organized and existing under the laws of the State of Florida.

On January 11, 2002, the Bank was closed by the Office of the Comptroller of the
Currency and pursuant to 12 U.S.C. § 1821fc), the FDIC was appointed receiver. In accordance
with 12 U.S.C. § 1821(d), the FDIC as receiver succeeded to all rights, titles, powers and
privileges of the Bank, including those with respect to ifs assets.

: ; Gin ‘March 9, 2004, the FDIC submitted a Proof of Loss to St. Paul for its claim under

Hamilton’s Financial Institution Bond Na (the “Bond”). The FDIC also provided

a Supplemental Proof of Loss to St. Paul on May 1, 2007. St. Paul denied coverage.

On May 19, 2008, St. Paul filed a declaratory jadgment action against the FDIC secking a
declaration of its rights and obligations under the Bond. On June 28, 2008, the FDIC filed a
counterclaim against St. Paul in the same action. That action is now pending in the United States
District Court for the Southern District of Miami, Docket No. 1:08-cv-21192-CIV-Garber (the

“Coverage Action”).



extent deemed relevant and admissible by a court and may use this Agreement in any manner as
may be necessary to enforce the terms of the Agreement.

B. Coo tive Drafting. The Parties to this Agreement have participated jointly in

the negotiation and preparation of this Agreement. Accordingly, the Parties agree not to assert
that any other party is the sole or principal drafter of the Agreement. The Parties also agree not
to assert that any canon of construction applicable to sole or principal drafters should be applied
against any other party.

Cc. Execution in Countemarts. This Agreement may be executed in counterparts by
one or more of the Parties named herein and all such counterparts when so executed shall
together constitute the Sigal Agreement, as if one document had been signed by all parties hereto;
and each such counterpart, upon execution and delivery, shall be deemed a complete original,
binding the party or parties subscribed thereto upon the execution by all parties to this
Agreement

D. ‘Binding Effect’ Each of the undersigned persons represenis and warrants that
they are a party hereto or are authorized te sign this Agreement on behalf of the respective party,
and that théy have the full power and authority to bind such party to cach and every provision of
this Agreement. This Agreement shail be binding upon and inure io the benefit of the
undersigned parties and their respective heirs, executors, administrators, representatives,
successors and assigns.

EL No Confidentiality. The Parties acknowledge and agree that this Agreement is a
pablic document that will need to be disclosed pursuant to 12 U.S.C. § 1821(s) and other

applicable laws and regulations,



SECTION Hi: Stipulation and Dismissal

Upon execution of this Agreement by each of the undersigned Parties, and receipt of the
Settlement Funds, plus any accrued interest, St. Paul and the FDIC shall dismiss the Coverage
Action and the Appeal. The undersigned Parties agree to enter a stipulation providing that the
dismissals described in the sentence set forth above shall be with prejudice, with each party to
bear its own costs as these were originally incurred. in the event the Court dismisses the
Coverage Action subject to reinstatement prior to payment to the FDIC of the Settlement Funds,
together with any accrucd interest, in full, the Parties agree that any applicable statutes of
Jimitations will be tolled as of the date of the initial filing in the Coverage Action until all
payments are received in. fall or suit is filed by the FDIC either to enforce the terms of this
Settlement Agreement ar to reinstate the Coverage Action. Hf this Aggeement does not become
effective or is voided for any reason, then the Parties will revert tw their respective litigation
positions as if this Agreement never existed.

SECTION IU: Releases

Av Rel f St. Ps DIC.

x ‘ EXéctive upon payment by St. Paul of ihe Setttement Funds, together with amy accrued
interest, the FDIC, for itself and its successors and assigns, hereby releases and discharges St.
Paul, its parents, subsidiaries, affiliates and reinsurers, and their respective employees, officers,
directors, agents, representatives, successors and assigns, from any and all claims, demands,
obligations, damages, actions and causes of action, direct or indirect, in law or in equity,
statutory or non-<ontractual, that the FDIC alleged or could have alleged against St. Paul in the
Coverage Action, or which the FDIC could have alleged against St. Paul thereafter, that arise

from or relate to any coverage claims asserted by the FDIC under the Bond, St. Paul's adjusting



(b)(2).(b)
(4)
(b)(2)

ACCOUNT #:

OBL 4e asset numbey Hamilton Bank, Miami, FL, Contact: Roy Ahrens, 703-
562-2420; Professional Liainlity lawsuit (37100); DIF Fund.

Dd. In the event that the Settlement Funds are not delivered in full to the FDIC by the
Payment Due Date, interest shall accrue on all unpaid amounts af the rate of 5% per annum from
such date until the date of payment in full.

E. _ In addition, and without waiving any other rights that the FDIC may have, in the
event that all Settlement Funds are not received by the FDIC on or before 30 days following the
Payment Due Date, then the FDIC, in its sole discretion, shall have the sight at any time prior to
receipt of all Settlement Funds {including all accrued isiterest) to declare this Agreement null and
void, shall have the right to exiend this Agreement for any period of time until it receives all
Settlement Funds (including all accrued interest), and/or shall have the right to enforce this
Agreement against St. Paul, which agrees to jurisdiction in Federal District Court in Miami,
Florida and further agrees to pay all the FDIC’s reasonable attomeys’ fees expended in enforcing
St. Paul's obligation to pay the Settlement Funds or any part of them. Any decision by the FDIC
to éxtend the terms of this Agreement or to accept a portion of the Settlement Funds shall not
prejudice the FDIC’s rights to declare this Agreement null and void at any time prior to receipt
of all Settlement Funds (including all accrued interest) or to enforce the terms of this Settlement
Agreement: provided however, that in the event the FDIC declares this Agreement null and void,
the FDIC will return all amounts paid to it under this Agreement by St. Paal. The Parties further
agree to the jurisdiction of the Federal District Court in Miami to resolve any other disputes
related to the enforcement of the terms of this Agreement (otber than with respect to the matters

addressed in Section IV C, below),



(b)(2).(b)
(4)

(b)(2).(b)
(4)

On July 7, 2009, St. Paul filed a third party complaint in the Coverage Action against
Ronald A. Lacayo (“Lacayo”) (the “Third Party Claim”). The Third Party Claim is still pending.

On March 30, 2010, the District Court granted St. Paul’s Motion for Partial Summary
Judgment declaring there is no coverage under the Bond for the FDIC's “Russian Swaps” claim.

On July 8, 2011, the FDIC filed a Notice of Appeal from the District Court’s Partial
Swomary Judgment raling, which appeal is currently pending in the United States Court of
Appeals for the Eleventh Circuit, No. 11-13133-HH A (the “Appeal”).

The undersigned Parties deem ii in their best interests to enter into this Agreement to
avoid the uncertainty, trouble, 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, cach with the other, as follows:

SECTION f: Payment to FDIC
A The Recitals above are incorporated herein by reference.
. y B. . As an essential covenant and condition to this Agrocment, St. Paul agrees to pay
to the FDIC the sum of eleven million US. dollars ($11 000,000.00) (the “Settlement Funds”).
a No later than ten business days following the execution of a signed original, or
signed originals in counterpart, of this Agreement by the undersigned Parties to this Agreement
{the “Payment Due Date”), the Settlement Funds shall be delivered to the FDIC by direct wire

transfer into the following designated account:

BANK: Federal Home Lowi Bank 0:

ROUTING #:

FOR CREDIT TO: FDIC National Liquidation Account

ied