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Cl'f/ .Lttl .LDJ...: J. .:1; .:U. - ~0 PAGE 02/06 

SETTLEMENT AGREEMENT AND 

MUTUAL RELEASE 

L PARTIES: The J)arties to this Settlement Agreement ("Agreement'") are Plaintiff 

FEDERAL DEPOSIT INSURANCE CORPORATION as Receiver for :Downey Savings & Loan 

Association, FA. ("FDIC-R"). and Defendant broke'fs, AMERIFUND FINANCIAL, INC., a 

dissolved California corporation ("Amerifund") ERIC MA'ITimW ANDBRSON, an individual 

("Anderson'') Gointly, "Defendants"). The FDIC-R and Defendants are sometimes herein 

collectively re:fetted to as the "Parties!' 

. 2. RECITALS: This Agreement is made with reference to the following facts: 

2.1 Certain claims arose between the Parties concerning six (6) loan 

applications that were submitted by AmerifUnd to Downey Savings & Loan Association, F.A. 

("Downey} in 2004 and 2005 ("Loans"). Downey approved tbc loan applications fOT Ann 

.Donovan, Chris and Pam Gallegos, Alan and Rowena Manuel, Anthony 'Norman, Petra White 

and Terri Lynn Worthy. Baeh Loan was secured by a tru1t deed on real property tb.at was then 

owned by the borrowers. 

2.2 The Loans subsequently defaulted and following foreclosure sates, the real 

properties each reverted to Downey, resulting in a combined alleged Joss to the thrift of over 

Sl, 1 oo,ooo.oo. 

2.3 In November 2008, the FDIC-R was appointed the Receiver over all of 

Powncy•a asset:! and liabilitlc::~. Among tbe as5cts the FDIC-R is cbarged with trying to recover 

upon ;s tbe loss relating to the Loan ("Claims"). 

2.4 The Claims subsequently beciame the subject of a Complaint 

("Complaint'') entitled FDIC4 R v. Amerlfwzd Financial, etc., et al .. Case No. SACV1I-o840 

DOC (RNBx), filed by the FDIC-R ("Action") and now pen~g in the United States District 

Court for the Central District of California, Southern Divi$ion. 

2.5 In its Complaint. the .FDIC-R alleges that Anderson was the qualifying, 

licensed real estate broker under whose license Amerifund qualified to and did business; a®, 

f:Urther, that Anderson should be held jointly li!lblc with Amerifund on the C1a.ims because 

Anderson was the alter eso of Amerifund. 

2.6 Defendants filed Answe111 in response to the PDIC-R's Complaint and 

Defendants have been represented by legal counsel throughout the pendency of the Action. 

including this settlement. 

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2. 7 By this Agreement the Parties hereto intend to settle and dispose of, fully 

and completely. any and all claim~. demands, causes of action, obligations, damages, aud 

liabilities that arise out of or relate to the Acti<1n and the Cldims alleged therein by tbe FDIC-R 

against the Defendants. 

2.8 The Federal D~osit I~ C.otporation in its separate oorporete 

capac:Hy as the insurer of deposits and bank .regulator, and all other fcdcraJ agencies of the 

United States of America, are not parties to this Agreement and arc not bound in any manner to 

its tertn5 and conditions. The FDIC-R crJters into this Agreement solely in its limited capacity as 

the appointed Receiver of Downey Savings & Loan Association. F .A., and no other receivership 

now existing, previously existing or hereafter appointed. 

3. NO ADMISSION RE MERITS OF CLAIMS: The Parties agree that nothing in 

this Agreeme:nt, aod no performance under this Agreement, shall be construed as an admission 

by any Party of the validity or invalidity of the Claims alleged in the Act.iol\j and, the Partie' 

agree that this Agreement is entered into solely for the purpose of convenience ond to 

compromise the disputed Claims the FDIC-R has all~ed in the Action against the Defendants. 

4. SETTLEMENT TERMS: The Parties agree to the following settlement tmms: 

4.1 The FDIC-R agrees to stipulate with Dcfendantll to dismiss the Defendant!! 

from the Attlon with pRjudicc in exchange for Defendants' waiver of altQmey's fees and costs 

and the execution of this Settlement Agreement and Mutual Release. 

5. MUTUAL I!ELEASE5 AND WAIVER OF CIV, CODE§ 1542; 

5. J lu consideration of the Settlement tenns as set forth in Paragraph 4 above, 

and all other promises, covenants and consideration provided for herein, the Parties agree that, 

except as to such rights or claims as may be created by this Agreement, they herebY covenant not 

to tue ~ch othet ever again on the Claim!! and the Parties acknowledge full and complete 

satisfaction of. and hereby release, remise, and f()I1!Vl'!l' discharge each other, including their 

reBpective iilS'U['eT5, officers, d~tors, affiliated compani~s. agents, representatives, spouses, 

heirs, successors or predecessors in interest} assignees, attorneys, employees and oontra.ctors 

from any and all the Clabna, demand.o;, caunts, obligations, agreements, damages, Uabilities, 

losses, CQSts and expenses of Blly kind;. in law or in equity, whether known or unknown~ that 

either \'arty now holds, or has ever held against the other. or ntay hold in the future, that arise out 

of or are in any way eonnected with, the Clabns alleged in the Aetion. 

5.2. This Agreetnent shall be bindi~ on the Parties and on their respective 

officers, directors, affiliated companies, insurers, agents, representativea1 spouses, heirs, 

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successors or predecessors in interest. assignees. attorneys, employees and contractors end shall 

~ to the benefit of the Parties, and each of them. 

5.3 The Parties specifically intend that the release contained in this Aareement 

shall bar all released claims, including those which are currently un.lmown to them .. The Parties 

llllderstand and accept the risk that they may later discover a claim encompSS{Icd by the Release 

in this Agreenl¢llt which they did not know or suspect to exist, or which they could not have 

known or suspected to exist. The Parties hereby specifically waive the protection of Civil Code 

section 1542 which reads as follows: 

A general release does not extend to claims which the creditor does not 

know or suspect to exist in his or her tavor at the tim.e of executing the 

release, which if known by him or her mu.'it have materially affected his or 

her settlement with the debtor. 

The f<Jregoing waiver is expressly limited to the claims held by tbe Plaintiff, Federal Deposit 

Insurance Corporation 11$ Receiver tor Downey Savings rmd Loan As.oociation, F.A •• flJld no 

other receivership, l'l('lr to tbc: Federal Deposit InSW'allCe Corporation in its separate corporate 

capacity, as more particularly set for in paragraph 2.8 above. 

6. A TTORNEXS' FEES: 1n the event any action is brought to enforce or jntetprct 

this Agreement the prevailing party shall be entitled to an award of reasonable attorneys' fees In 

addition to any other relief to wbi.ch the prevailing party may be entitled. 

7. REPRESI!iNIATIQNS AND WARRANT~: The Parties repTCSent, warrant. 

and agree as follows: 

7.1 The FDIC~& is the lawfully appointed Receiver for Downey and has 

succeeded to tmd now holds each of the Claims tbat are the subject of the Action and thls 

Agreement. The FDIC-R has the authority to enter into this compromise and settlement of the 

Claims as the Receiver of Downey. 

7.2 Bach of the Parties has received or bad the opportunity to seek their own 

independent legal advice with respect to the advisability of a.ecuting this Asrcemont. Tbe 

Parties acknowledge that they have cxec:uted this Agrcgnent without fraud, duress, or undue 

influoncc. The Parties affinn that they have read this Agreement and undc:rstand the ccmtents 

. hereof. 

7 .:; No Party, not any agent or attorney of any Purty, has made any statemeJ:Jt, 

PaJe3of.' 

SETTLEMENT AGREEMENT ANOMUTUALRRLEASE 

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GAI3URO PAC£ Bli/E16 

DATED: /la Mc1/L 

APPROVED AS TO FORM: 

;p 

c. ox 

ERTC 

FEDERALDEPOSIT~SURANCE 

CORPORATION, as Rec(liver for Downey Savings 

&~na~~A-------~ 

eys for Federal Deposit Insurance 

Cotpondicm as Receiver for DoWiley 

...._ __ ___,Savings & Loe.n Association. F.A. 

VIRGINIA GABURO ASSOCJA YES 

V GIN GABURO 

eys for Defendants, 

Amcrifund F"tnanciat, Inc. and 

Erie Matthew .Anderson 

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