(b)(4),(b) 

,_(6) . ··········.,. 

············ 

Page 1 

SETTLEMENT AGREEMENT 

THIS SETTLEMENT AGREEMENT C'Settlement Agreement") is entered 

into and made effective as of the j j\1. day cf June 2009 (uEffcctive Date"), by and 

between FEDERAL DEPOSIT INSURANCE CORPORATION~ as Receiver for 

INDYMAC FEDERAL BANK~ f'.S.B. formerly known as INDYMAC BANK, F.S.B. 

(hefeinafter "lNDYMAC") and FREEDOM MORTGAGE CORPORA. TION~ a New 

Jersey corporation; and FREEDOM MORiGAGE CORPORATION dba fREEDOM 

HOME MORTGAGE CORPORA T!ON in California (collectively referred to herein as 

''FREEDOM MORTGAGE"). INDYMAC and FREEDOM MORTGAGE may 

hereinafter be referred to individually as a "Party•• or collectively as the "Parties". 

I. RECITALS 

1.1 On or about September 30, 2002, INDYMAC and FREEDOM 

MORTGAGE entered into a business relationship govemed by a Mortgage Loan 

Purchase and Interim Servicing Agreement (hereinafter "Agrecment'1

), 

1.2 Pursuant to the terms oftheAgreement, FREEDOM MORTGAGE sold to 

lNOYMAC the following 36 loans identified by borrower name, loan number(s), 

principal amount(s) and address: 

.......... ·······-. 

5652·068 

SETTLEMENT AGR£F.M£Nl 

Page I o(l4 
(b)(4),(b) 

(6) .. ', 

·· ..... 

',. 

Page 2 

SETTLEMENT AGRE!i.MENT 

Pote 2 cf 14 
(b)(4),(b) 

;(6) ', r ·• ..... 

'·. 

r·-._ 

?Jo26l,OOH.ll!S~.1 

Page 3 

SF.TTI.EMF.NT AGREEMENT 

Fi!ge .3 of 14 
'(b)(4),(b) 

(6) ',, '· 

',. 

'•. 

Page 4 

SETTLEMENT AGREEMENT 

P<~ge4ofl4 
(b)(4),(b) 

(6) . 

(b)(4),(b) (er··· 

Page 5 

1.3 The 37 loans described in pa~:agraph 1.2 above are collectively referred to 

herein as the "SUBJECT LOANS". 

EiUiy Payment Default loans as define y ecnon . o e gr 

FREEDOM MORTGAGE breached the Agreement by refusing to repurchase these loans. 

after receiving dernan<;Js from fNDYMAC. 

1.5 INDYMAC also c!aims that FREEDOM MORTGAGE breached certain 

representations and warranties conlained in the Agreement with respect to the 

SETTLEMENT AGREEMENT 

PnseS ofl4 
(b)(4)JI:>.1.. . ... 

(6) . 

(b)(4),(b) 

(6)m"m 

Page 6 

............. J ........................... m·········································································m·················m··········· JLOANS. 

1NDYl\11AC contends 1i demanded FREEDOM MOKIGAGE repurchase an or 

indemnify JNDYMAC for losses it sustained as a result of these loans but FREEDOM 

MORTGAGE refused. 

1.6 FREEDOM MORTGAGE; disputes INDYMAC's claims relating to the 

SUBJECT LOANS. Specifically, and without limitation, FREEDOM MORTGAGE 

denies that it breached the representations and warranties provisions of the Agreement or 

that it breached any duty owed to INDYMAC. 

1.7 On or about June 13, 2008.INDYMAC filed a lawsuit entitled JNDYMAC 

BANK, FSB v. FREEDOM MORTGAGE CORPORATION, a New Jersey corporation; 

r"""'REEDOM MORTGAGE CORPORATION; dba FREEDOM HOME MORTGAGE 

CORPORATION: and DOES 1- 100, inclusive; Case No. BC392687 {hereinafter 

"Action"). Pursuant to its Complaint in the Action, fNDYMAC sought damages arising 

out of the SUBJECT LOANS. The Complaint in the Action included thirty~eight {38) 

separate causes of u.ction, thirty-six. for breach of contract, one for specific perfonnam;e 

and one for negligence. 

l.S On August 5, 2008, INDYMAC dismissed t F.,_;=~~==..=.;..--, 

·n to the followin loans: 

hereinafter referred to as the "DISMISSED SUBJE T LOANS"). Although 

;=m:n::I:!Imltss.~:J:o.tu.,!the Action, for purposes of this Settlement Agreement, the 

is hereinafter also part of the DlSMISSE SUBJECT LOANS, 

1.9 The Parties desire and have agreed to settle all daims relating to the 

SUBJECT LOANS described in paragraph 1.2 of this Settlement Agreement. 

2. AGREEMENT 

NOW, THEREFORE, in consideration of the mutual covenants and promises set 

forth herein, and for other good and valuable consideration, the receipt and sufficiency of 

which are hereby acknowledged by the Parties, the Parties, intending to be legally bound, 

agree as follows: 

2.1 Rccitais. The Recitals set forth above are incorporated into the body of 

this Settlement Agreement as though fully set forth herein. 

St.TTLEMt;"NT AGREEMENT 

J'a~c 6 of 14 
(b)(4). ___ _ 

Page 7 

2.2 Payment to INDYMAC. Payment of Four Hundred Seventy-Five 

Thousnnd Dollars and no/cents {$475,000.00) {the "Settlement Futids"} shall be paid on 

behalf of FREEDOM MORTGAGE to l'NDYMAC. 

(a) Of the Settlement Funds, the initial payment {the .. Initial Payment") shall 

be for Two Hundred Twenty-Five Thousand Dollars and no cents ($225,000.00). The 

ln~ial Payment shall be made by wirin~!he funds"' foll<>wso Beneficiaury Bank: Wcl~ 

Eacgo..Baok;...ABA-R.oot~-AS I I Account #:I P~neflc.iacy_As;c.o.Y.!lL _ ___ lQJ( 4) 

Name: Mortgage Recovery Law Group rust Account. The Initial Payment shall be -·-· 

received on or before June 12,2009. 

(b) The remaining Two Hundred Fifty Thousand Dollars and no cents 

{$2.50,000.00) shall be paid in two equal payments as follows: One Hundred Twenty· 

rive Thousand Dollars and no cents ($125,000.00) on July 13, 2009 and One Hundred 

Twenty-Five Thousand Dollars and no cenlS ($125,000.00) on August 12, 2009. The 

two monthly payments shall be maCd' in the fun<ls as follows ~ Beneficiary Bank: 

. (b)( 4 ) _____ _ _.W~ells Eargo...Bank:,ABA Roott!lg-#1 -- c:count #:I =--;Jilcnet1c'"*ia~ry~ --!CQJffi 

Account Name: Mortgage Recovery aw roup Trust Account . 

2.3 Concurrently whh the signing and delivery of this Senlt:mcnt Agreement, 

FREEDOM MORTGAGE shall execute a Stipulation for Entry of Judgment in the 

amount o fTwo Hundred Fifty Thousand Dollars and no cents ($250,000.00) less any 

amounts received pursuant to paragraph 2.2(b)1 in the form attached hereto as Exhibir L 

The Stipulation for Entry of Judgment incoqloratcs by reference the Judgment (Pursuant 

lo Stipulation)~ attached to the Stipulation as F..xh[bit A. Both the Stipulation and 

Judgment are incorporated by reference herein and their tenns made a part of this 

Settlement Agreement. The Stipulation and Judgment shaH be held in trust by 

INDYMAC'S anomeys of record and shall not be filed uttless FREEDOM MORTGAGE 

breaches paragraph 2.2(b) above and fails to timely cure said breach pursuant to 

paragraph 2.5 after receiving lNDYMAC notice of default .as provided in paragraph 2.4. 

The Judgment (Pursuant to Stipulation) shall not be entered so long as FREEDOM 

MORTGAGE perform.~ under the tenns of this Settlement Agreement with respect to 

making rhe payments required by paragraph 2.2(b) above. Entry of Judgment in 

accordance with the terms of the Stipulation, and enforcement of said Judgment~ shall be 

INDYMAC's sole recourse in the event of o default by FREEDOM MORTGAGE in 

making the payments called for herein. 1NDYMAC'S auomeys of record shall return the 

original Stipulation for Entry of Judgment (without the same having been filed with the 

Court) to FREEDOM MORTGAGE'S attorneys of record, c/o Jeff M. Hall, Esq., Green 

& Hall. A Professional Corporation, 185l East First Street, 10th Floor, Santa An~ CA 

92705·4052> withln five business days of INDYMAC'S receipt of tho second payment 

required by paragraph 2.2(b) above. 

2.4 In the event FREEDOM MORTGAGE defaults by failing to make n 

timely payment to INDYMAC as set forth in paragraphs 2.2(b) above, TNDYMAC shall 

7J(,:UJ. 134114.1 )1BL4. I 

SETTLEMENT /1GR~cMENT 

Page 1 of 14 
Page 8 

give written notice of the default and notice ofilS intent to enter Judgment (Pursuant to 

Stipulation) to FREEDOM MORTGAGE via mail and facsimile at: (l) Freedom 

Mortgage Corporation, A TfN; David Altman, 907 Pleasant Valley Avenue, Suite 3, 

Mount Laurel, NJ, 08054, Voice: (&56) 626-2303 and Fax: {866) 656-3665; and (2) Jeff 

M. Hall, Green & Hall, A Professional Corporation, 1851 East First Street, 1 011' Floor, 

Santa Ana, CA 92705-4052. Voice: (71 4) 918-7000 and Fax: (714) 918-6996. 

2.5 FREEDOM MORTGAGE shall have five (5) business days from receipt 

of the notice of default to cure the default. If FREEDOM MORTGAGE fails to cure the 

default within five {5) business d~:ys, INDYMAC shall retain all consideration it 

received. and it may, in its sole discretion, seek to enter the Judgment (Pursuant to 

Stipulation) and enforce said Judgment against fREEDOM MORTGAGE. Judgml..'lll 

may be entered by ex parte application (without testimony or trial and FREEDOM 

MORTGAGE further waives the right to a court and/or jury trial) w'ith notice given to 

FREEDOM MORTGAGE and JeffM. Hall, Esq. by facsimile and telephone at the 

facsimile and phone numbers listed above. 

2.6 Within 5 business days of INDYMAC's counsel's receipt of the fully 

executed Settlement Agreement and Stipulation for Entry of Judgment, JNDYMAC1s 

counsel shall file a request for dfsmissal of the er.tire Action with prejudice.. 

2.7 Each Party agrees that Section 664.6 of the Code of Civil Procedure of the 

State of California shall apply to this Settlement Agreement and requests that the court 

retain jurisdiction over the Pa.-ties to enforce this Settlement Agreement and, if ne-eessary, 

the Judgment (Pursuant to Stipulation). 

2.8 The Parties shall bear their own costs and attorneys' fees incurred in the 

Action3. RELEASE 

3.1. JNDYMAC hereby represents that it dismissed the DISMlSSED 

SUBJECT LOANS f:rom the Action becuose JNDYMAC no longer has nn interest in the 

DISMlSSED SUBJECT LOANS. fREEDOM MORTGAGE understands and accepts 

JNDYMAC'S representation that the DISMISSED SUBJECT LOANS have been sold, 

assigned or otherwise transferred to third parties including. but not limited to. successors, 

servicers, institutions or hanks and further acknowledges and agrees that this release has 

no effect on any rights, claims or causes of action relating to the DlSMlSSED SUBJECT 

LOANS which belong to these third parties_ Moreover, the Parties expressly agree and 

understand that INDYMAC Jms no right or ability to release any demands, claims or 

causes ofaction relating to the DJSMlSSED SUBJECT LOANS which belong to these 

third parties and does not do so, and further that the release given by INDYMAC relating 

to lhe DISMISSED SUBJECT LOANS is limited to a release of rights, claims or causes 

of action, if any, belonging only to JNDYMAC. 

7.;621>l.I)Hl4.1JI f~ l 

SETILI!MENT AGREcMf<NT 

hg=!! url ~ 
Page 9 

3.2 Unknown Cl:abns. lNDYMAC and FREEDOM acknowledge and agree 

that the release they give to eacb other upon executing this Setclement Agreement applies 

to all claims for injuries, damages, or losses of any type or nature (whether those injuries, 

dam:1ges, or losses are known or unknown, foreseen or unforeseen, patent or latent} 

which they may have ogainst each other arising from or in conjunction with the 

SUBJECT LOANS (incfudir~ the DfSM£SSED SUBJECT LOANS) described in 

paragraph I .2 of this Setrlement Agreement. 

3.3 The Parties acknowledge .ond agree that FREEDOM MORTGAGE 

processed, packaged and/or sold other mortgage loans to JNDYMAC whiah are not 

described In paragraph 1.2 of !his Settlement Agreement and that this Settlement 

Agreement and the Release does not apply to mortgage loans not described herein. 

lNDYMAC expressly reserves its rights to pursue any and all clnims and causes ofllction 

it may have in law or equity against F'REEDOM MORTGAGE arising out of any 

mortgage loan which is not described hetein. 

3A The Parties hereby expressly waive application of California Civil Code 

§1542. The Par1ies certify that they have read and understood the following provisions of 

California Civil Code §1542 which states in pertinent part as follows: 

A general tel ease does not extend to claims which the creditor 

does not know or suspect to exist in his or her favor nt the 

time of ex.ecuting the release, which if known by him or her 

must huve materially affected his or her settlement with the 

debtor. 

3.5 The Parties understand and acknowledge that the significance and 

consequence of its waiver of Colijornia Civil Code §J 542 is that even if eitber Party 

should eventually suffer additional damages arising from or in conjunction with the 

SUBJECT LOANS or any facls or circumstanct;S related to the SUBJECT LOANS, 1ha1 

Party will not be able to make any claim for those damages. Furthermore, each Party 

acknowledges that they consciously intend these conse'lucnces even ns to claims for 

damages that may cx.ist as of the date of this release relnting to the SUBJECT LOANS, 

but which that Party dpes not know exists, and which, if known, would materially affect 

that Pany 's decision to execute this release, regardless of whether that Party's lack of 

knowledge is the result of ignorance, oversight, error, negligence, or any other cause. 

3.6 Except for the rights, duties, and obligations set forth in this Settlement 

Agreement and Stipulation fur Entry of Judgment, the Parties oach hereby fully, finally, 

and forever release and discharge the other Party, and any aod a II of its resp~tive, 

mployee~ brokers, investors, members, partners, joint venturers, independent 

contractors. attorneys, insurers, agents, investors, representatives, officers, directors, 

shareholders. independent contractors, and any corporation, pannership or limited 

liability compnny which was or is at any time the parent or wholly owned subsidiary of 

1JU~l IJ.4U4 UIS~ I 

SETILEMF.NT AGRP..f.t-1F..NT 

P•ge9 o! H 
Page 10 

such entity, and any such corporation's, pnrtnershiJis or limited liability company's 

officers, directors, employees and/or agents, or any cosporonion, partnership or limited 

liability company which was or is an affiliate of such entity by \'irtue of common 

ownership or control, and any such COfPOration's, partnerShip's or limited iiabillty 

company's, officers, directors, employees and/or agents of and from nny and all actions, 

causes of action, claims, demands, damages, debts, losses, costs, expenses1 attorney fees 

or other liabilities of every kind and nature whatsoever, whether legal or equitable and 

whetheT known or unknown. arising out of, resulting from, or relating to, in any manner, 

the SUBJECT LOANS (including the DJSMJSSED SUBJECT LOANS). The Parties 

further acknowledge and agree that neither Party will take any a<:tion or assen any claims 

or demands against the other Pany with any federal, slate. municipal, or other 

governmental agency or court relating to the SUBJECT LOANS (including the 

DISMJSSED SUBJECT LOANS). 

3.7 (:xQrcss Reservation from Releases by FOlC. Notwithstanding any other 

provision, by this Settlement Agreement, the FDIC docs not release, and expressly 

preserves fully and to the same extent as rfthe Settlement Agreement hod not been 

executed, (a) any claims or causes of action that do not arise from or relate to Che 

DISMiSSED SUBJECT LOANS and SUBJECf LOANS, or the defense of the same) or 

(b) any action taken by any other federal agency. As of the execution of this Settlement 

Agreement, the FDIC is not aware of any action taken or claims held by another federal 

ag¢ncy arising from or related to the SUBJECT LOANS. ln addition. this Settlement 

Agreement does not purport to waive, or intend to waive, any claims which could be 

brought by the United States rhrough either the Depanment of Justice or the United States 

At1omey' s Office in any federaljudicial district. In addition, the FDlC specifically 

reserves the right to seek court ordered restitution pursuant to the relevant provisions of 

the Victim and Witness Protection Act, 18 U.S.C. § 3663, t!T seq .• if appropriate. 

4, MISCELLANEOUS 

4.1 Conditions af Execution. Each Party acknowledges and warrt~nts that its 

execution of this Settlement Agreement and Stipulation for Ermy of Judgment is free and 

voluntary. 

4.2 Confidentiality, The Parties agree that neither they nor anyone acting on 

their behalf, Including their respective attorneys, will disclose to anyone any information 

relating to, in any way. the contents or terms of this Settlement Agreement, or any 

m11ners pertaining to this settlement, includlng its negotiation, unless such disclosure is: 

(I) lnwfuHy required by any governmental agency~ (2) othenvlse requ~red by law 

(including legally required financial reporting or other disclosures); or (3) necessary in 

any legal proceeding (0 enforce any provision of this Settlement Agreement. The Parties 

may disclose the tenns of this Settlement Agreement to their respective auditors, 

acc-ountants. tax advisors, and legal counsel, but only to the extent required for 

professional advice from tfK)se sources and only after securing a commitment from iliose 

36~63.llUH.Il1!6~ 1 

SETTLEMENT AGR!!EMENT 

Png!~l0ofl4 
Page 11 

professionals to maintain the confidentiality of this Settlement Agreement, as required 

above, to the greatest extent possible considering the purpose for which the tenns ofthe 

Settlement Agreement are needed by those professionals. 

4.3 No Admission. lt is agreed thnt no Party hereto admits liability or 

wrongdoing of any nature, and that this Settlement Agreement is made as a compromise 

of dispuled claims. 

4.4 .Fair Meaning. The Parties hereto further agree that the language of all 

parts of this Settlement Agreement shall in all cnses be construed as a whole, according to 

its fair meaning, and not strictly for or agninst ony of the Parties 

4.5 Governing Law. The Parties agree to submit to the Courts of the City 

and County of Los Angeles, California, for any dispute arising out ofthis Sc:ttlcmcnt 

Agreement, or related thereto, and consent to the jurisdiction of said Courts and further 

agree that any and all mutters of dispute shall be adjudicated, governed and controlled 

under California law. 

4.6 Attorneys Fees and Costs. Should any action be commenced to enforce, 

interpret, or seek damages, injunctive relief. or specific performance for violation ofthis 

Settlement Agreement, the prevaiJing party shall, in addition to any other available relief. 

be entitled to an award ofrcasonabfe attorney's fees and litigation expenses incurred in 

the prosecution or defense of the action, including any appeal. 

4.7 Severability. The Parties hereto agree that ifany provision of this 

Settlement Agreement is declared by any court to be illegal or invalid. the validity of the 

remaining parts, terms or provisions shaH not be affected thereby, and such illegal or 

invalid part, term or provision shall be deemed not to be part ofthis Settlement 

Agreement. 

4.8 Binding Effect. This Settlement Agreement shall be binding upon and 

inure to the benefit of the: Parties and their respective heirs, personal representatives. 

successors, and assigns. 

4.9 Review and Understanding. The Parties have entered into this 

Settlement Agreement voluntarily, having fully read and fully understood the meaning 

and effect of nil of its tenns and provisions, and fully understanding its and their costs 

· <llld risks. Each of the Parties has consulted with legal counsel concerning this Settlement 

Agreement and has conducted such inquiry as they deem necessary and advisable prior to 

entering into this Settlement Agreement. The Parties enter into this Settlement 

Agreement understand!ng that facts or other circumstances may exist which are presently 

unknown or undisclosed, or which are different from or other than those which they 

believe to be the case, and the Pnrt!cs voluntarily assume all risks attendant to such 

unknown, undisclosed, different, or additional facts or o:hr:r citcumsfances. 

SETTLEMI!.NT AQRF.I:iM!iNT 

Poge tl of 14 
Page 12 

4.10 Approval, Authority, and Nonassignment. The Parties represent and 

warrant to one another that the approval of this Settlement Agreemem has been 

undertaken In a proper and lawful manner and that they have the requisite power a:nd 

authority to enter into and to perfonn their obligations under this Settlement Agreement1 

and further warrant and represent that \"'ith the exception of the DlSMlSSED SUBJECT 

LOANS, they have not sold, assigned, granted or traosferred to any other person, 

corporate or natural, or to any entity, ally claim, action, demand, or cause of action 

released by this Settlement Agreement. 

4.11 Number. Whenever applicable, the singular shalt include the plural, and 

the plural shall include the singular. 

4.1l CounterpartsiExeeutlon. This Settlement Agreement may be executed 

in one or more counterparts. all of which shall form a single agreement. A Party•s 

signature on this Settlement Agreement by facsimile or e-mail shall be valid and effective 

for all purposes as an original signature. provided, however. that theoriginaJ signn!ure 

shall be produced upon request, 

4.13 Waiver. No term or condition of this Settlement Agreement shall be 

deemed to havt: been waived1 nor shall there be nn estoppel against the enforcement of 

any provision of this Settlement Agreement, e:xcept by written instruments signed by the 

Party charged with the waiver or estoppel. No written waiver shaU be deemed a 

continuing waiver unless specifically stated therein, and the written waiver shall operarc 

only as to the specific term or condition waived, and not for the future or as to any other 

net than that speoiflcally waived. 

4.14 Headings. The headings of paragraphs herein are intended solely for the 

convenience of reference and shall not control the meaning or interpretation of any of the 

provisions of this Settlement Agreement. 

4.15 Subsequent Agreements. The Parties agree that, upon the reasonable 

request ofthe other Partyf they shall execute, acknowledge, and deliver any additional 

instruments or documents that may reasonably be required to carry out the Intentions of 

this Settlement Agreement, including such instruments as may be required by the Jaws of 

any jurisdiction, now in effect or hereinafier enacted, that may affect the rights of the 

Parties as between themselves or others with respect to the)r rights and obligations 

created by this Settlement Agreement. 

4.16 Entire: Agreement. The Parties hereto further agree and promise that this 

Settlement Agreement sets forth the entire agreement between and among the Parties and 

fully supersedes any a11d aU prior negotiations, agreements or understandings made 

between or amon g the Parties. This Settlement Agreement shall not be modified except 

in a writing signed by the Parties or their authorized representatives. 

SETTLEMENT AGREEMENT 

Poge 12 oil4 
Page 13 

JN WITNESS WHEREOF, and intending to be legally bound hereby, the Pnrt1es 

have executed this Settlement Agreement as of the date set forth in the opening paragraph 

of this Settlement Agreement. 

DATED; June 1_, 2009 

APPROVED AS TO FORM 

DATED: June JL 2009 

GREEN & HALL. APC 

................................................... (~)('?.) 

By: 

Je M. Ha: , Esq. 

Attorneys fo efendants, FREEDOM MORTGAGE 

CORPORATION and FREEDOM MORTGAGE 

CORPORATION dba FREEDOM HOME 

MORTGAGE CORPORATION 

FREEDOM MORTGAGE CORPORATION and 

FREEDOM MORTGAGE CORPORATION dba 

FREEDOM HOME MORTGAGE CORPORATION 

~I ~2~~-gn_a_t_w_e-----------------L~ ± 

STA.-J/..;l'-t <:.. tl"lcca<e..nA.t>l C';.(..... 

Type/Prim Name and Title . 

[SJGNATURES CONTINUE ON FOLLOWiNG PAGE' 

1.H26l.tZ48H.IliS64.1 

.$661-068 

SETIL£MENT AGREEMENT 

Pa&c tJ or lit 
DATED: Junfi, 2009 

APPROVED AS TO FORM 

DATED: June i-\ ~ 2009 

Page 14 

ANDER ON, McPHARLJN &. CONNERS LLP 

B 

Attomc. 

FEDERA POSfT INSURANCE 

CORPORATION, as Receiver for 

INDYMAC FEDERAL BANK, F.S.B. formerly known 

as INDY MAC BANK, F.S.B. 

FEDERAL DEPOSIT INSURANCE CORPORATION 

AS RECElVER FOR lNDYMAC FEDERAL 

BANK,F.S.B fonnerly known as JNDYMAC BANK, 

F.S.B. 

By: ~~-------······-.1~ Jl:>)(§.) 

Signalure 

SEn'LEMENl AGREeMeNT 

P11ge 14 ofl4