Case No. C 10-05336 JSW 1 Robert L. Brace, Esq., SBN ...

STIPULATION AND AGREEMENT OF SETTLEMENT Case No. C 10-05336 JSW 1

Robert L. Brace, Esq., SBN 122240 Email: [email protected] HOLLISTER & BRACE P.O. Box 630 Santa Barbara, CA 93102 Telephone: (805) 963-6711 Facsimile: (805) 965-0329

Attorneys for Plaintiffs Vivian R. Hays, et al., and the Class of Commingled Exchangers Margaret A. Keane, Esq., SBN 235378 Email: [email protected] LITTLER MENDELSON, P.C. 650 California Street, 20th Floor San Francisco, CA 94108-2693 Telephone: (415) 288-6303 Facsimile: (415) 743-6645 Attorneys for Defendants Commonwealth Land Title Insurance Company, Commonwealth Land Title Company, and Fidelity National Title Insurance Company, f/k/a LandAmerica Charter Title Company, successor by merger to Lawyer’s Title Insurance Corporation

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

VIVIAN R. HAYS, an individual, et al.

Plaintiffs,

vs. COMMONWEALTH LAND TITLE INSURANCE, a Nebraska corporation, et al.

Defendants.

)) ) ) ) ) ) ) ) ) )

Case No. C 10-05336 JSW The Honorable Jeffrey S. White STIPULATION AND AGREEMENT OF SETTLEMENT


Plaintiffs Vivian R. Hays; Sharon R. Billedeau; Brookvest, LLC; CDC-Rural, LP and CDC-

Glendale, LP; Commercial One Corporation; DCRE Investments, LLC; Robert P. Dreyer;

Esperance, LLC; Femrite Commercial Rentals, LLC; Daniel Friedlander; Iron Crown, LLLP;

Kyoungae Kim, as Trustee of the Kyoungae Kim Trust dated December 16, 2002; Carolyn Kneese,

as Trustee of the Carolyn Calvin Kneese Trust; Leapin Eagle, LLC; Danny J. McDaniel and Charis

L. McDaniel; Kevin D. Miller and Jin Suk Park; Giuseppe Passantino and Rosanna Passantino; Fred

Piro, as Trustee of The Mary and Freddie Piro 1987 Trust; Larry E. Presnell; Prudential Properties,

LLC; Tracy A. Ralphs and Sandra M. Ralphs; Ted William Ramos and Emilia Ramos, as Trustees of

the Ramos Family Trust, dated 4-14-04; Gregory D. Schultz; Peter Schonberger; Denise Wilson;

Kenneth Wood; Joseph A. Zelinka and Pamela Zelinka (collectively the “Class Representatives”)

and Defendants Commonwealth Land Title Insurance Company (“CLTIC”), Commonwealth Land

Title Company (“Commonwealth”), and Fidelity National Title Insurance Company (“FNTIC”),

f/k/a LandAmerica Charter Title Company (“LCTC”), successor by merger to Lawyer’s Title

Insurance Corporation (“LTIC”) (collectively, the “Title Company Parties,” and together with the

Class Representatives, the “Parties”) enter into this stipulation and agreement of settlement (the

“Agreement” or “Settlement Agreement”). This Agreement is intended by the Parties hereto to

fully, finally, completely, and unconditionally compromise, resolve, forever discharge, release,

acquit, waive, dismiss with prejudice and settle the above-captioned lawsuit and the Released Claims

(as defined herein), subject to the terms and conditions set forth below and final approval by the

Class Action Court (as defined herein).

WHEREAS:

A. On November 24, 2010, the above-captioned litigation was initiated with the filing of

a Complaint for a purported class action in the United States District Court, Northern District of

California, Case No. 3:10-5336. On March 13, 2011, the case was transferred to District of South


Carolina pursuant to order of the United States Judicial Panel on Multidistrict Litigation. The case

pending in the District of South Carolina was styled In re: IRS Section 1031 Tax Deferred

Exchange Litigation, Vivian R. Hays, et al. v. Commonwealth Land Title Insurance Company, et al.,

MDL Management Case No. 8:09-mn-2054-JFA, and District of South Carolina No. 3:11-cv-00619-

JFA.

B. On August 11, 2011, plaintiffs filed a First Amended Complaint (the “FAC”).

Defendants moved to dismiss the FAC; that motion was fully briefed and argued and remains under

advisement with the court as of the date of this Agreement. No class has been certified. On March

12, 2012, the Judicial Panel on Multidistrict Litigation issued a Conditional Remand Order

indicating that remand of the case to the transferor court was appropriate. Pursuant to the Remand

Order, the case was transferred back to the Northern District of California and is currently styled

Vivian R. Hays et al. v. Commonwealth Land Title Insurance Company, et al., Northern District of

California Case No. C 10-05336 JSW (the “Hays Class Action”).

C. The Class Representatives seek to proceed as a Class (as defined below) on behalf of

themselves and all others similarly situated, including approximately 384 people located in various

states, each of whom allegedly lost money entrusted to LandAmerica 1031 Exchange Services, Inc.

(“LES”) in 2008 to facilitate their respective Internal Revenue Code Section 1031 exchanges.

D. The named Defendants in the Hays Class Action are CLTIC, Commonwealth, LTIC,

and LCTC. These defendants were all former subsidiaries of LandAmerica Financial Group, Inc.

(“LFG”), which filed a Chapter 11 bankruptcy case on November 26, 2008. LES, also a subsidiary

of LFG, also filed for bankruptcy protection on the same date. Certain subsidiaries of Fidelity

National Financial, Inc. (“FNF”) purchased certain non-debtor subsidiaries, specifically including,

but not limited to, LTIC and CLTIC, from LFG while the LFG bankruptcy case was pending. The

sale was approved by order of the United States Bankruptcy Court for the Eastern District of


Virginia (the “Bankruptcy Court”) on or about December 17, 2008. Subsequently, LTIC was

merged into FNTIC.

E. The Title Company Parties deny any wrongdoing, fault, liability, intentional or

negligent tortious conduct, malpractice, or damage to the Class Representatives, the purported Class,

or any member of the Class; deny that they committed any violation of law; deny each of the specific

causes of action alleged against them in the Complaint and FAC; and deny that they acted

improperly in any way with respect to their dealings with LES and dealings with their customers.

The Title Company Parties further state that they believe that (i) they acted properly at all times, and

(ii) the claims asserted against them in the Hays Class Action (the “Hays Class Claims”) and any

other Released Claims are without merit. The Title Company Parties, by entering into this

Settlement, do not concede the merit of any claims asserted against them or the lack of merit of any

defense to liability.

F. The Class Representatives and certain members of the proposed class filed claims in

the LES Bankruptcy case, and pursuant to the plan became beneficiaries of the LandAmerica 1031

Exchange Services Inc. Liquidation Trust (the “LES Trust”) and/or the LFG Liquidation Trust (the

“LFG Trust” and, together with the LES Trust, the “Trusts”). The Trusts were created by the Joint

Chapter 11 Plan of LFG and its Affiliated Debtors (the “Plan”), which was approved by order

entered on November 23, 2009 by the Bankruptcy Court . The purpose of the Trusts is to liquidate

certain assets and distribute the proceeds to the Trust beneficiaries to pay their claims as asserted in

the bankruptcy cases.

G. Pursuant to the Plan, certain assets of LES and LFG were transferred to the Trusts,

including the right to pursue coverage under certain insurance policies issued to LFG and its

affiliates (the “Policies”) by Certain Underwriters at Lloyd’s of London (“Underwriters”). The

Policies are subject to an aggregate liability limit of $50 million. The Trusts assert that Underwriters


are obligated to provide coverage up to the $50 million limit for the claims of the 1031 exchanger

plaintiffs that are the beneficiaries of the Trusts. Underwriters disputed that they are obligated to

provide coverage at all, and further dispute the amount of coverage that is available.

H. The Title Company Parties contend that Underwriters are obligated under the Policies

to provide coverage up to the $50 million limit for the claims of the 1031 exchanger plaintiffs that

have asserted claims against the Title Company Parties, including the claims asserted in the Hays

Class Action.

I. On or about January 11, 2012, the LES Trustee, the LFG Trustee, and Underwriters

entered into a settlement agreement and release (the “Trustees/Underwriters Agreement”) which

provided, among other things, that (1) Underwriters would pay the Trusts $37,855,029.06 to resolve

the Trusts’ claims against Underwriters for coverage under the Policies and prior years’ policies for

the LES/LFG Claims, (2) the Available Coverage (in the amount of $41,055,029.06, referred to in

the Trustees/Underwriters Agreement as the “LES/LFG Available Coverage”) would be deemed

exhausted, (3) the parties would provide each other with mutual releases, and (4) if the

Trustees/Underwriters Agreement was approved pursuant to its terms, the Trusts would not make

affirmative claims against Lawyers Title of Arizona, Inc., CLTIC or LTIC for certain prior payments

made to them. The Trusts filed a motion to approve the Trusts/Underwriters Agreement on January

26, 2012 (the “Approval Motion”).

J. The Title Company Parties, together with FNF filed an objection to the Approval

Motion (the “Objection”) making several arguments, including that the Trustees/Underwriters

Agreement improperly relieved Underwriters of at least $3.2 million in coverage obligations. The

Trusts and Underwriters disputed the merits of the Objection. On or about March 29, 2012, the Title

Company Parties, FNF, the Trustees, and the Underwriters entered into a settlement agreement (the

“FNF/Trustees/Underwriters Agreement”) that, when effective, will resolve the Objection. The


FNF/Trustees/Underwriters Agreement is attached hereto as Exhibit 4. On April 2, 2012, the

Trustees filed a motion for entry of a Modified Approval Order (the “Modified Approval Motion”),

which the Bankruptcy Court granted on April 19, 2012.

K. Pursuant to its terms, the Modified Approval Order can only become effective under

certain conditions. One of those conditions is the entry of a final order approving this Settlement

Agreement. Conversely, the effectiveness of this Settlement Agreement is contingent on entry of the

Modified Approval Order and it becoming a Final Order. The Bankruptcy Court has entered the

Modified Approval Order. Therefore if this Court enters a final order approving this Settlement

Agreement the end result will be that the LES Trust will receive a gross recovery of approximately

$36,855,029.06, the Class will receive a gross recovery of $11 million, and fees for Class counsel

will be capped at 25% of $9 million of that $11 million.

L. The Parties wish, on the terms set forth herein, to resolve their differences concerning

the foregoing matters without resort to expensive and time-consuming litigation, the outcome of

which would be uncertain. This Agreement shall not be construed or deemed to be a concession by

the putative Class Representatives of any infirmity in the Hays Class Claims or as a concession by

the Title Company Parties of any wrongdoing, fault, liability or damage to Class Representatives, or

any other person or entity, or any infirmity in any defense the Title Company Parties asserted, could

have asserted, or could assert.

M. The Class Representatives, by their counsel, have conducted discussions and an

arm’s-length negotiation with the Title Company Parties in an attempt to settle the Hays Class

Claims and achieve the best relief possible consistent with the interests of the proposed Class. This

Agreement has been entered into after and is the product of arm’s-length negotiations conducted in

good faith. The Parties have voluntarily agreed to settle the case and any other Released Claims

after consultation with competent legal counsel. The Title Company Parties, having taken into


account the risk and expense of protracted litigation and potential litigation, are satisfied that the

terms and conditions of this Agreement are fair, reasonable, adequate, and in the best interests of the

Title Company Parties. Class Representatives and their counsel have concluded that the terms and

conditions of this Agreement are fair, reasonable, and adequate to the proposed Class and in their

best interests.

N. Class Counsel states that it has conducted an extensive investigation relating to the

Hays Class Claims and the underlying events and transactions alleged in the Hays Class Action and

has researched the applicable law with respect to the claims and potential claims against the Title

Company Parties and the potential defenses thereto; and that their investigation included, among

other things, reviewing and analyzing relevant documents that they deem necessary and appropriate

to enable them to enter into this Agreement on a fully informed basis. Subject to the provisions

herein, Class Representatives each agree to this Settlement under the terms and provisions of this

Agreement, after considering (a) the substantial benefits that Class Representatives and the Class

will receive from the Settlement, (b) the attendant risks of protracted litigation in the Hays Class

Action, which would involve highly complex legal and factual issues relating to class certification,

liability, and damages, and would involve substantial uncertainties, delays, and other risks inherent

in litigation, and (c) the desirability of permitting the Settlement to be consummated as provided by

the terms of this Agreement.

NOW THEREFORE, in consideration of the foregoing, the mutual promises contained

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

hereby acknowledged, without any admission or concession on the part of Class Representatives of

any lack of merit of the Hays Class Claims, and without any admission or concession of any fault,

damage, liability, wrongdoing, or lack of merit in defenses whatsoever by the Title Company Parties,


it is hereby STIPULATED AND AGREED, by and among the Parties, subject to the approval of the

Class Action Court, as follows:

1. Rules of Construction and Definitions

As used in this Agreement, the following rules of construction and definitions apply to this

Agreement, including the Exhibits to this Agreement:

1.1 The definitions contained in this Agreement apply to capitalized terms wherever

those terms appear in this Agreement, including the prefatory paragraphs and recitals above, the

sections below, and the Exhibits hereto. Capitalized terms in the prefatory paragraphs and recitals

above, the sections below, and the Exhibits hereto have the meanings ascribed to them therein to the

extent they are not otherwise defined in this Section. Each defined term stated in the singular shall

include the plural and each defined term stated in the plural shall include the singular. Any pronoun

stated in the masculine, feminine, or neutral gender shall include all genders. The word “including”

when used in this Agreement means “including but not limited to,” and the words “include,”

“includes,” and “included” shall be similarly construed. The words “herein,” “hereof,” “hereunder,”

and any other words of similar import, when used in this Agreement refer to the entirety of the

Agreement, including the Exhibits hereto.

1.2 “Bankruptcy Code” means Title 11 of the United States Code, 11 U.S.C. §§ 101 et

seq., as amended from time to time.

1.3 “Class” means, for purposes of the Settlement only, each and every commingled

exchanger who entrusted 1031 exchange funds to LandAmerica 1031 Exchange Services, Inc. after

February 11, 2008 and who has been denied access to any of those exchange funds, and who

suffered loss or damages or allegedly suffered loss or damages in any way, directly or indirectly,

related to or arising out of (a) the bankruptcy of LES, or (b) any of the events, acts or conduct

alleged in the Complaint or the First Amended Complaint filed in the Hays Class Action. The Class


shall also include any person or entity that holds a valid assignment of a Hays Class Claim from a

commingled exchanger plaintiff where the Assignor of such Hays Class Claim would have been

eligible to participate in the Class but-for the assignment. Notwithstanding the foregoing, the

Class shall not include (a) any persons or entities that have already settled with and released the

Titled Company Parties, or any of them, for any claim that would otherwise qualify such persons or

entities for membership in the Class, or (b) any persons or entities that have made a valid assignment

of a Hays Class Claim to any other person or entities prior to the date that an order approving this

Settlement Agreement becomes a Final Order.

1.4 “Class Action Court” means the federal district court in which the Hays Class Action

is pending.

1.5 “Class Action Approval Order” means one or more orders and/or judgments finally

approving the Settlement entered pursuant to Federal Rule of Civil Procedure 23 by the Class Action

Court after a Fairness Hearing, which include(s) provisions (i) releasing the Released Parties from

all liability to the Class Representatives and Class members, (ii) barring and enjoining all Class

Representatives and Class members from prosecuting any of the Released Claims against the

Released Parties, (iii) barring and enjoining certain claims as described in Exhibit 3, (iv) establishing

a Settlement Fund (as defined below), (v) dismissing the Hays Class Action in its entirety, and all

individual claims against the Title Company Parties alleged therein, on the merits and with prejudice

as described in Exhibit 3, (vi) certifying the Class for purposes of Settlement only as described in

Exhibit 1, and (vii) limiting fees to class counsel to no more than 25% of nine (9) million dollars.

The Class Action Approval Order shall contain the language in the form of Exhibit 3 hereto, without

any material modifications to thereto, and such other language agreed to by the Parties.

1.6 “Class Counsel” means Hollister & Brace, a Professional Corporation.


1.7 “Effective Date” means the date on which all the following have occurred: (i) the

Preliminary Approval Order (as defined below) has been entered in all material respects; (ii) the

Class Action Approval Order has become Final or, if the Court enters an order and final judgment in

form materially different from the Class Action Approval Order (the “Alternative Judgment”) and

none of the Parties hereto elect to terminate this Settlement, the Alternative Judgment has become

Final; (iii) certification has been made to the Released Parties by Class Counsel that no Class

member has submitted a written Request for Exclusion pursuant to Section 8 of this Agreement, or

in the event a class member has submitted a written Request for Exclusion, the Title Company

Parties have been notified under Section 8.4 of this Agreement, and have not elected to terminate

this Settlement Agreement pursuant to Section 8.4 of this Agreement; (iv) the Modified Approval

Order has been entered by the Bankruptcy Court and has become a Final Order; and (v) the Title

Company Parties’ Counsel has received an Internal Revenue Service Form W-9 containing the

taxpayer identification number for the payee of the Settlement Amount.

1.8 “Execution Date” means the first date by which all of the Parties have executed and

delivered this Agreement. This Agreement shall be deemed delivered when the last Party sends an

executed copy of this Agreement by electronic mail or overnight delivery in accordance with Section

12 hereof.

1.9 “Fairness Hearing” means the hearing held by the Class Action Court to consider

final approval of the Settlement pursuant to Rule 23(e) of the Federal Rules of Civil Procedure.

1.10 “Final” means the latest of: (i) the expiration of the time to appeal, petition for

certiorari, move for reargument or rehearing, or otherwise seek any review of the relevant order or

judgment and as to which no appeal, petition for certiorari, or other proceedings for reargument,

rehearing, or review shall then be pending; (ii) the final affirmance of the relevant order or judgment

on an appeal or after reconsideration or other review, the expiration of the time for a petition or a


denial of any petition, to review the affirmance of the relevant order or judgment on appeal, or if

such petition is granted, the final affirmance of the relevant order or judgment following review

pursuant to that grant; (iii) the final dismissal of any appeal from the relevant order or judgment or

the final resolution of any proceeding to review any appeal from the relevant order or judgment

without any material change thereto; or (iv) the date on which all rights to appeal, petition for

certiorari, or move for reargument or rehearing as to the relevant order or judgment shall have been

waived in writing. Any proceeding or order, or any appeal or petition for a review of a proceeding

or order, pertaining solely to any application for or award of attorneys’ fees and/or expenses shall

not in any way delay or preclude the Class Action Approval Order or the Alternative Judgment from

becoming Final.

1.11 “Hays Class Claims” means any claims that were or could have been asserted against

the Title Company Parties in the Hays Class Action.

1.12 “Modified Approval Order” means the order entered by the Bankruptcy Court

approving the terms of the settlement contained in the Trustees/Underwriters Agreement attached

hereto as Exhibit 5.

1.13 “Notice” means the Summary Notice of Pendency of Class Action substantially in

the form attached as Exhibit 2 hereto.

1.14 “Payment Date” means 10 business days after the Effective Date.

1.15 “Plaintiffs” means all Class Representatives and every member of the Class.

1.16 “Preliminary Approval Order” means the order of the Class Action Court

preliminarily approving the Settlement and directing notice thereof to the Class, substantially in the

form attached as Exhibit 1 hereto.

1.17 “Released Claims” means any past, present, or future claim, demand, right, action,

litigation, arbitration, charge, complaint, obligation, cross-claim, counter-claim, lawsuit,


administrative proceeding, notice of liability or potential liability, cause of action, suit, or liability of

any kind, nature, or description whatsoever, that has been, could have been, may be, could be, or will

be asserted against any of the Released Parties, whether seeking damages (including compensatory,

punitive, or exemplary damages) or equitable, mandatory, injunctive, or any other type of relief,

including costs, attorneys’ fees, losses, and expenses of any nature whatsoever, whether at law1 or in

equity, whether known or Unknown (as defined below), asserted or unasserted, anticipated or

unanticipated, foreseen or unforeseen, suspected or unsuspected, accrued or un-accrued, fixed or

non-contingent or contingent, direct or derivative or indirect, belonging to the Class or any of the

Class Representatives arising out of, based on, in connection with, pertaining to, concerning, or

directly or indirectly related in any way to (i) the subject matters of the Hays Class Action, including

without limitation any claims that have been or could have been asserted by any Class member in the

Hays Class Action against the Released Parties (as defined below); or (ii) anything related to or

arising under the events, allegations, facts, acts, omissions, advice, occurrences, conduct, or

transactions stated or referred to in the Complaint, First Amended Complaint, or any subsequent

pleading or amended complaint in the Hays Class Action; provided, however, Released Claims shall

not include (a) any claim under a title insurance policy underwritten or provided by any defendant,

or (b) any claim arising out of the violation, nonperformance, or breach of this Agreement, or (c) any

claim that has been specifically and expressly excluded from the releases contained in the

Trustees/Underwriters Agreement or the FNF/Trustees/Underwriters Agreement.

1.18 “Released Parties” means the Title Company Parties (as defined below) and Fidelity

National Financial, Inc. (“FNF”), together with the Title Company Parties’ and FNF’s present and

former parents, subsidiaries or affiliates, successors, predecessors, assigns (but specifically

excluding LFG and LES), and the directors, officers, employees, agents and attorneys of the

1This includes federal, state, local, statutory, or common law, or any other law, rule, or regulation.


foregoing, but solely in their capacity as such for the Released Parties. For the avoidance of doubt,

LFG and LES are not released by this Agreement. For the avoidance of doubt, the officers,

directors, employees, agents and attorneys of LFG and/or LES are not released by this Agreement

from liability based on their actions in the capacity as such for LFG and/or LES.

1.19 “Settled Defense Claims” means any past, present, or future claim, demand, action,

cause of action, suit, or liability of any kind or nature whatsoever, whether at law or in equity,

whether known or Unknown (as defined below), asserted or unasserted, anticipated or unanticipated,

accrued or un-accrued, fixed or contingent, held at any point from the beginning of time to the date

of this Agreement, that have been or could have been asserted by the Released Parties or any of them

individually, against any of the Class Representatives and their legal representatives in their capacity

as such, and all their present or former subsidiaries, parents, successors, predecessors, officers,

directors, general or limited partners, representatives, affiliates, members, heirs, managers, agents,

attorneys, counsels, associates, employees, insurers (only in those representatives’, agents’,

attorneys’, or insurers’ capacities as representatives, agents, attorneys, or insurers for any of the

Class Representatives with respect to the Settled Defense Claims), and assigns, arising out of,

connected with, or in any way relating, directly or indirectly, to (i) the subject matter of the Hays

Class Action; or (ii) anything related to the events or facts stated in the Complaint, First Amended

Complaint, or any subsequent pleading or amended complaint in the Hays Class Action; provided,

however, Settled Defense Claims shall not include any claim related to title insurance coverage or

other insurance services underwritten by any defendant.

1.20 “Settlement” means the terms of the settlement.

1.21 “Settlement Amount” means the sum of Eleven Million Dollars ($11,000,000.00).


1.22 “Settlement Fund” means the qualified settlement fund that the Class Action Court

shall establish pursuant to 26 C.F.R. § 1.468B et seq. into which the Title Company Parties or their

insurers shall deposit the Settlement Amount on the Payment Date.

1.23 “Title Company Parties” means Commonwealth Land Title Insurance Company

(“CLTIC”), Commonwealth Land Title Company (“Commonwealth”), Fidelity National Title

Insurance Company (“FNTIC”), f/k/a LandAmerica Charter Title Company (“LCTC”), successor by

merger to Lawyer’s Title Insurance Corporation (“LTIC”).

1.24 “Unknown Claims” means any and all (i) Released Claims that any Class

Representative or Class member is not aware of or does not suspect to exist, and which is in his, her,

or its favor at the time of the release of the Released Parties, and any and all (ii) Settled Defense

Claims which the Title Company Parties are not aware of or do not suspect to exist, and which is in

their favor at the time of the release of the Settled Defense Claims, which, in each case of (i) and (ii),

if known by him, her, or it might have affected his, her, or its decision(s) to enter into this

Settlement. With respect to any and all Released Claims and Settled Defense Claims, the Parties

stipulate and agree that upon the Effective Date, the Class Representatives and the Title Company

Parties shall expressly waive and relinquish to the fullest extent permitted by law, and each Class

member shall be deemed to have waived and relinquished (and by operation of the Class Action

Approval Order, each Class member shall have expressly waived and relinquished), any and all

provisions, rights and benefits conferred by California Civil Code § 1542 and any federal law, any

law of any state or territory of the United States, or any principle of common law, which is similar,

comparable, or equivalent to California Civil Code § 1542. California Civil Code § 1542 provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.


It is the intention of the Parties that, notwithstanding the provisions of California Civil Code § 1542

or any similar provisions, rights and benefits conferred by law, and notwithstanding the possibility

that the Class Representatives, the Title Company Parties, or their counsel may discover or gain a

more complete understanding of the facts, events or law that, if presently known or fully understood,

would have affected the decision to enter into this Agreement, any and all Released Claims and

Settled Defense Claims, including Unknown Claims, shall be fully, finally, and forever settled. In

furtherance of this Agreement, the Parties expressly waive any and all rights they may have under

any contract, statute, code, regulation, ordinance, or the common law, which may limit or restrict the

effect of a general release as to claims that they do not know or suspect to exist in their favor at the

time of the execution of this Agreement. The Class Representatives and the Title Company Parties

acknowledge, and Class members shall be deemed to have acknowledged, that the inclusion of

“Unknown Claims” in the definitions of Released Claims and Settled Defense Claims was separately

bargained for and was a key element of the Settlement.

2. Scope and Effect of Settlement

2.1 The obligations incurred under this Agreement shall be in full and final resolution and

disposition of any and all Released Claims and Settled Defense Claims.

2.2 Upon the Effective Date, the Class Representatives and the Class members, on behalf

of themselves and each of their past or present officers, directors, employees, agents, representatives,

general or limited partners, managers, members, affiliates, parents, subsidiaries, heirs, executors,

administrators, successors and assigns, shall, to the fullest extent of their authority to do so, with

respect to each and every Released Claim, fully, finally, completely, and unconditionally release,

acquit, forever discharge, dismiss with prejudice, compromise, resolve, settle, and waive any

Released Claim against any Released Party.


2.3 Upon the Effective Date, each of the Released Parties shall release and forever

discharge each and every one of the Settled Defense Claims, and shall forever be enjoined from

prosecuting the Settled Defense Claims.

2.4 As of the Execution Date, the Class Representatives (on behalf of themselves and the

putative Class) hereby agree not to take assignment(s) of, prosecute, or bring any known or

Unknown Claim(s) of one or more third parties or any other person or entity whatsoever, that might

seek to bring an action against the Released Parties, relating to any of the events, facts, allegations,

individuals, or entities referred to in the definitions of Released Claims or Released Parties in

Sections 1.16 or 1.17 of this Agreement. As of the Execution Date, the Class Representatives (on

behalf of themselves and the putative Class) hereby agree not to assign, sell, transfer or otherwise

convey an interest in any of the Released Claims to any third party or any person or entity

whatsoever. In the event that this Agreement becomes null and void such that the Settlement

Amount will not be paid, any and all obligations under this Section 2.4 shall cease.

2.5 As of the Execution Date, to the extent that any known or Unknown Claim, lawsuit,

action, cause of action, complaint, charge, litigation, or demand by one or more persons, entities, or

third parties against the Title Company Parties relating to any of the events, facts, allegations,

individuals, or entities referred to in the definitions of Released Claims or Released Parties in

Sections 1.16 or 1.17 of this Agreement exist, the Class Representatives (on behalf of themselves

and the putative Class) hereby agree not to sue the Title Company Parties with regard to any such

claim(s), nor to voluntarily assist, advise, entice, solicit, or otherwise encourage any such persons,

entities, or third party(ies) to bring such a claim, lawsuit, action, cause of action, complaint, charge,

litigation, or demand against the Title Company Parties. In the event that this Agreement becomes

null and void such that the Settlement Amount will not be paid, any and all obligations under this

Section 2.5 shall cease.


2.6 The Parties hereby agree not to seek to advance any legal or factual position against

another Party to this Agreement between the Execution Date and the Payment Date. The Parties

agree and stipulate that, pending the Fairness Hearing, all proceedings in the Hays Class Action shall

be stayed, other than proceedings necessary to carry out and enforce the terms and conditions of this

Agreement and the Preliminary Approval Order.

2.7 The Parties acknowledge and agree that the Settlement Amount hereunder represents

a compromise of all alleged or possible damages including but not limited to lost exchange funds,

tax liabilities, attorneys’ fees, costs, fines, statutory or civil penalties, emotional distress, personal

injury of any kind, and any other tort, contract, consequential and/or punitive damages of any kind.

2.8 Nothing in this Section 2 is intended to, or shall be construed to, affect the Parties’

ability to enforce this Agreement.

2.9 Nothing in this Agreement shall constitute a release, waiver, or assignment of any of

the Parties’ rights against any person or entity other than as specifically provided for herein.

3. Bar Order

3.1 To the extent permitted by applicable law, the Class Action Approval Order shall

contain provisions enjoining and barring all Class members from commencing any action or

asserting any claim against the Released Parties, which provisions shall be substantially similar in

form and effect to paragraphs 13 and paragraph 14 of Exhibit 3 hereto, including non-material

modifications thereto, or other language agreed to by the Parties or required by the Class Action

Court.

4. Class Certification

4.1 For purposes of this Settlement only, the Parties agree to jointly move for the

certification of the Hays Class Action as a class action pursuant to Federal Rules of Civil Procedure

23(a) and 23(b)(3), on behalf of the Class as defined herein. Class Representatives shall be certified


as the representatives of the Class. Such certification shall be conditioned on the approval and

effectiveness of this Settlement, and it is expressly understood and agreed that the Title Company

Parties do not waive any of their rights to contest class certification in the event the Settlement is not

consummated, becomes null and void pursuant to any provision of this Agreement, or is terminated.

5. Court Approval(s)

5.1 Any filings relating to efforts to obtain preliminary and final court approval for this

Agreement shall be submitted to the Title Company Parties for review and comment not less than 7

business days before being filed with the court. On or before May 15, 2012, the Class

Representatives and the Title Company Parties shall jointly apply to the Class Action Court for entry

of a Preliminary Approval Order, substantially in the form attached as Exhibit 1, and Class Counsel

shall move for certification of the Class solely for purposes of this Settlement and shall provide

Notice to the Class as prescribed by the Preliminary Approval Order, pursuant to Federal Rule of

Civil Procedure 23. In addition, on or before May 15, 2012 the Class Representatives (on behalf of

themselves and the Class) and the Title Company Parties shall jointly apply to the Class Action

Court for entry of the Class Action Approval Order, substantially in the form attached as Exhibit 3,

and to schedule a Fairness Hearing. The Title Company Parties and the Class Representatives will

reasonably cooperate to obtain entry of the Class Action Approval Order as expeditiously as

practicable. Notwithstanding the foregoing, Class Counsel shall have the responsibility for ensuring

that the Hays Class Action is dismissed with prejudice in accordance with the terms of this

Agreement.

5.2 Upon notice from any of Title Company Parties to Class Counsel that a claim based

on, or in any way related to the Released Claims has been asserted in any forum against a Title

Company Party before the Class Action Approval Order is Final, the Class Representatives (on

behalf of themselves and the Class), within 25 days, shall (a) file a motion in the Class Action Court,


or the forum where the litigation is pending, and (b) seek the consent of each of the plaintiffs in the

litigation to an order staying that litigation as against the Title Company Parties (either an order

granting such a stay or consent to such a stay shall constitute the “Stay Order”), until the Class

Action Approval Order is Final. Notwithstanding the foregoing sentence, the Class Representatives

shall have no obligation to seek a Stay Order regarding any litigation or disputes that are not based

on or related to the Released Claims. The Class Representatives’ obligations that are described in

this Section 5.2 shall cease on the date that the Class Action Approval Order becomes Final.

5.3 After the Class Action Approval Order is Final, if any Title Company Party seeks

enforcement of the releases contained in this Agreement or seeks enforcement of the Class Action

Approval Order, Class Representatives (on behalf of themselves and the Class) shall provide

supporting affidavits upon request. In addition, after the Class Action Approval Order is Final, if a

claim based on or in any way related to the Released Claims is brought against any Title Company

Party, the Class Representatives (on behalf of themselves and the Class) shall, upon request,

reasonably assist any Title Company Party to enforce the Class Action Approval Order and the

releases contained in this Agreement. The Class Representatives shall not be required to provide an

affidavit that would support broader releases than those contained in this Agreement or, upon advice

of counsel, is not supported by existing facts or law.

6. Confidentiality of Settlement Negotiations

6.1 Any evidence of the negotiations or discussions associated with the Settlement

Agreement shall be subject to Rule 408 of the Federal Rules of Evidence and any corresponding

state law evidence rules, and shall be inadmissible in any action or proceeding for purposes of

establishing any rights, duties, or obligations of the Parties hereto.

7. Payment of the Settlement Amount

7.1 On or before Payment Date, the Title Company Parties shall cause the Settlement


Amount to be deposited into an account as directed by Class Counsel to be held as a Settlement Fund

for the benefit of the Class.

7.2 Class members shall look solely to the Settlement Fund for settlement and satisfaction

of any and all Released Claims against any and all of the Released Parties. None of the Released

Parties shall be responsible for any fees and expenses of Class Counsel, experts, consultants, and

agents, or any administrative or other approval expenses of the Settlement, including taxes, if any.

None of the Released Parties shall be responsible for any administration expenses, including but not

limited to costs and expenses of providing notice to members of the putative Class, costs and

expenses associated with the administration of the Settlement Fund, escrow fees, taxes, and custodial

fees. None of the Released Parties shall have any liability with respect to any taxes, expenses and/or

costs incurred in connection with the taxation of the Settlement Fund or the payment or withholding

of taxes, or the preparation or filing of any returns. None of the Released Parties shall be responsible

for the operation or administration of the Settlement Fund, and none of them shall have any liability

with respect to any aspect of the operation or administration of the Settlement Fund. Class counsel

shall have sole responsibility for disbursements from the Settlement Fund.

8. Rights of Exclusion or Objection

8.1 Any prospective Class member may seek to be excluded from the Class and the

Settlement provided for by this Agreement by submitting a written request for exclusion in

conformity with the requirements stated in the Notice (a “Request for Exclusion”). Any Class

member so excluded shall not be bound by any Class Action Approval Order and Final Judgment

and/or other Order or judgment of the Class Action Court entered pursuant to this Agreement. Any

member of the Class who fails to submit a timely and valid Request for Exclusion shall be bound by

all terms of this Agreement and any Class Action Approval Order and Final Judgment, regardless of

whether they have requested exclusion from the Settlement.


8.2 Any Class member who does not timely exclude himself, herself, or itself from the

Class and Settlement shall have the right to submit written objections concerning the Settlement,

which objections shall identify the full name, address, and telephone number of the objecting class

member and state all of the reasons for the objections (e.g., a mere statement that “I object” shall not

be deemed sufficient). Any such objection must be filed with the Court and a copy must be served

upon Class Counsel. All entities desiring to send a representative to attend the Fairness Hearing and

be heard as objectors must have filed and served written objections as provided herein as a condition

of appearing and being heard at such hearing. Members of the Class who fail to file and serve

timely written objections in the manner specified above shall be deemed to have waived all

objections and shall be foreclosed from making any objection, whether by appeal or otherwise, to the

Settlement.

8.3 To retract or withdraw a Request for Exclusion, a Class member must file a written

notice with Class Counsel (and Class Counsel must immediately provide such notice to the Title

Company Parties) within thirty (30) calendar days of Class Counsel’s receipt of a Termination

Notice (as defined below) (unless such time is extended by written agreement) stating the member’s

desire to retract or withdraw his, her, or its Request for Exclusion and that member’s desire to be

bound by any judgment or settlement in this action; provided, however, that the filing of such written

notice may be effected by Class Counsel. Class Counsel shall promptly notify the Title Company

Parties of any retraction or withdrawal of a Request for Exclusion.

8.4 Class Counsel shall provide any submitted Requests for Exclusion to the Title

Company Parties by e-mail within five (5) business days after receipt. The Title Company Parties

shall have the right to terminate this Agreement and the Settlement as to all Parties if any

prospective member or members of the Class timely and validly request exclusion from the Class in

accordance with the Notice. If the Title Company Parties exercise the termination right under this


paragraph, then subject to the provisions of paragraph 8.5 below, (i) the Agreement shall become

null and void and of no further force and effect as among all Parties, except for the confidentiality

and no admissions sections specified herein, (ii) all Parties shall revert to their respective litigation

positions as to each other as of the day before the Settlement Agreement was executed, and the

action shall proceed as though class certification had not yet been requested pursuant to this

Agreement, (iii) the Parties’ obligations to each other under the Settlement shall become null and

void and of no further force and effect, and (iv) the fact and terms of the Settlement shall not be

offered or construed or deemed as evidence against any of the Parties, in accordance with the terms

of this Agreement, and pursuant to Rule 408 of the Federal Rules of Evidence and any

corresponding state law evidence rules.

8.5 The Title Company Parties shall notify Class Counsel in writing of their decision to

terminate the Settlement under Section 8.4 above within ten (10) business days (unless such time is

extended by written agreement) of Title Company Parties’ receipt of any submitted Requests for

Exclusion (the “Termination Notice”). If the Title Company Parties provide the Termination Notice

to Class Counsel, Class Counsel shall have thirty (30) calendar days (unless such time is extended by

written agreement) after receipt of the Termination Notice to cause any prospective Class members

to retract their Requests for Exclusion. If all prospective Class members who timely and validly

requested exclusion retract their Requests for Exclusion, then the Termination Notice shall become

null and void and of no further force or effect.

8.6 For the avoidance of doubt, assuming all other conditions to the occurrence of the

Effective Date have been fulfilled, then the Effective Date shall be deemed to have occurred on the

earliest day that either of the following occur : (a) certification has been made to the Released Parties

by Class Counsel that no Class member has submitted a written Request for Exclusion pursuant to

Section 8 of this Agreement, or (b) in the event any class member has submitted a written Request


for Exclusion, the Title Company Parties have been notified under Section 8 of this Agreement, and

have not elected to terminate this Settlement pursuant to Sections 8.4 and 8.5 hereof.

8.7 Any Class member who does not participate in the Settlement Fund’s distribution, but

who does not request exclusion from the Class, shall not be considered excluded for the purposes of

the Agreement. Any Class member who does not participate in the Settlement Fund’s distribution

shall be forever barred from receiving any benefit under this Agreement but shall in all other

respects be bound by the terms of this Agreement, including specifically the releases provided for

herein, and the Class Action Approval Order, and will be barred from bringing any action against

any of the Released Parties concerning any of the Released Claims.

9. Representations and Warranties of the Parties

9.1 Each of the Parties separately represents and warrants that it has the requisite power

and authority to enter into this Agreement and to perform the obligations imposed on it by this

Agreement.

9.2 Each of the Parties separately represents and warrants that the execution and delivery

of, and the performance of the obligations contemplated by this Agreement has been approved by

duly authorized representatives of the Party.

9.3 Each of the Parties separately represents and warrants that the Party has expressly

authorized its undersigned representative to execute this Agreement on the Party’s behalf as its duly

authorized agent and that the Party has carefully read the Agreement, knows and understands the

contents hereof, and is freely executing the Agreement.

9.4 Each of the Parties separately represents and warrants that this Agreement has been

thoroughly negotiated and analyzed by its counsel; that they agree to the terms of this Agreement

based on the legal advice of their respective attorneys; that they have been afforded the opportunity

to discuss the contents of this Agreement with their attorneys; that the terms and conditions of this


Agreement are fully understood and voluntarily accepted; and that this Agreement has been executed

and delivered in good faith, pursuant to arms’ length negotiations, and for good and valuable

consideration.

9.5 The Parties represent and warrant that they have not transferred or assigned any

claims within the scope of the releases in this Agreement.

10. Entire Agreement

10.1 This Agreement and its Exhibits constitute a single integrated written contract that

expresses the entire agreement and understanding between and among the Parties with respect to

matters that are the subject of this Agreement. If any material provision hereof is deemed

unenforceable by a court of competent jurisdiction, then the Agreement as a whole shall be deemed

terminated and null and void by written notice, and the rights and obligations of the Parties shall be

the same as if the Agreement were terminated and became null and void by written notice in

accordance with Section 8, above. Except as otherwise expressly provided herein, this Agreement

supersedes all prior communications, discussions, negotiations, agreements, settlements, and

understandings between the Parties and their representatives regarding the matters addressed by this

Agreement, whether oral or written, all of which are merged herein. Except as explicitly set forth in

this Agreement, there are no representations, warranties, promises, statements, or inducements,

whether oral, written, expressed, or implied, that in any way affect or condition the validity of this

Agreement or alter or supplement its terms. Any representations, warranties, promises, statements,

or inducements, whether made by any Party or any agents of any Party, that are not contained in this

Agreement shall not be valid or binding. If the facts or law related to the subject matter of this

Agreement are found hereafter to be other than is now believed by any of the Parties, then each of

them expressly accepts and assumes the risk of such possible difference of fact or law, and agrees

that this Agreement nonetheless shall be and remain effective according to its terms.


11. No Admissions by Parties

11.1 This Agreement, whether or not consummated, or any negotiation, discussion or

proceedings in connection with this Settlement:

(a) does not constitute and shall not be offered against any or all Released Parties for any

reason including, without limitation, as evidence of or construed as or deemed to be evidence of any

presumption, concession, or admission by any or all Released Parties with respect to the truth of any

fact alleged by Class Representatives or the validity or merit of any claim that has been, was, could

be, or could have been asserted in the Hays Class Action, including class action allegations, or the

deficiency, lack of merit, or infirmity of any defense that has been, was, could be, or could have

been asserted in the Hays Class Action, or of any liability, negligence, fault, damage, or wrongdoing

of any or all Released Parties;

(b) does not constitute and shall not be offered against any or all Released Parties as

evidence of or construed as or deemed evidence of a presumption, concession or admission of any

fault, misrepresentation or omission with respect to any statement or written document approved or

made by any or all Released Parties, or against any or all putative Class Representatives, or the

Class, as evidence of any infirmity in the Hays Class Claims or the Settled Defense Claims.

(c) does not constitute and shall not be offered against any or all Released Parties as

evidence of or construed as or deemed evidence of a presumption, concession or admission with

respect to any liability, negligence, fault, damage, or wrongdoing, or in any way used or referred to

for any other reason as against any of the Parties to this Agreement, in any other civil, criminal or

administrative action or proceeding (including, but not limited to, any formal or informal

investigation or inquiry by any state or federal governmental or regulatory agency), other than such

proceedings as may be necessary to effectuate the provisions of this Agreement;


(d) does not constitute and shall not be offered or construed against any or all Released

Parties as an admission or concession that the consideration to be given hereunder represents the

amount that could be or would have been recovered after trial; and

(e) does not constitute and shall not be offered or construed as an admission, concession

or presumption against Class Representatives that any of their claims are without merit.

(f) shall not be offered in evidence or otherwise used by any Party to this Agreement in

these or any other actions or proceedings, whether civil, criminal, or administrative, except (i) as

required to enforce the Settlement, this Agreement, the Class Action Approval Order, or any

provision contained in this Agreement, or (ii) in any other action or proceeding that may be brought

against any or all of Released Parties in support of a defense, counterclaim, or argument based on

principles of res judicata, collateral estoppel, law of the case, release, good faith settlement,

judgment, bar or reduction, or any theory of claim preclusion or issue preclusion or similar defense

or counterclaim, or any other liability protection granted them hereunder.

(g) Notwithstanding any other provision of this Agreement, any or all Released Parties

may file the Agreement, the Class Action Approval Order, and/or any other document filed with or

by the Class Action Court in any other action or proceeding that may be brought against any or all of

them in support of a defense, counterclaim, or argument based on principles of res judicata,

collateral estoppel, law of the case, release, good faith settlement, judgment, bar or reduction, or any

theory of claim preclusion or issue preclusion or similar defense or counterclaim, or any other

liability protection granted them hereunder.

12. Notice

12.1 Any and all statements, communications, or notices to be provided pursuant to this

Agreement shall be in writing and shall be deemed to have been given when sent by electronic mail

or overnight delivery service, in each case to the appropriate address or electronic mail address set


forth below. Such notices shall be sent to the individuals listed below, or to such other individuals as

the respective Party may designate in writing by notice to the other Parties from time to time.

For the Title Company Parties:

Margaret A. Keane Littler Mendelson, P.C. 650 California Street, 20th Floor San Francisco, CA 94108-2693 Tel: (415) 288-6303 [email protected]

With a copy to: Steven A. Goldfarb, Esq. Hahn Loeser & Parks, LLP 200 Public Square, Suite 2800 Cleveland, Ohio 44114 Tel: (216) 621-0150 [email protected]

For the Class:

Robert L. Brace, Esq. Hollister & Brace 1126 Santa Barbara Street Santa Barbara, CA 93101 Tel: (805) 963-6711 [email protected] [email protected]

13. Attorneys’ Fees and Expenses

13.1 Class Counsel will apply to the Class Action Court for an award of attorneys’ fees in

an amount as the Class Action Court may approve, but in no event shall it apply for or accept fees in

excess of 25% of $9 million. Such attorneys’ fees, expenses, and interest as the Class Action Court

awards, including any fees and expenses related to administration of the Settlement, shall be paid

exclusively from the Settlement Fund to Class Counsel immediately upon award, notwithstanding

the existence of any timely filed objections thereto, or potential for appeal therefrom, or collateral

attack on the Settlement or any part thereof. Class Counsel unconditionally guarantees to refund or


repay to the Settlement Fund up to the entire amount of such attorneys’ fees and expenses award,

plus accrued interest at the same net rate earned by the Settlement Fund, if and when the attorneys’

fees and expenses award is reduced or reversed. Any decision by the Class Action Court or any

other court concerning the amount of any fee award shall not affect the validity or finality of the

Settlement, this Agreement, or the Class Action Approval Order. Class Counsel hereby agrees that it

will be subject to the continuing jurisdiction of the Class Action Court in connection with the award

of any attorneys’ fees and/or the reimbursement of expenses. The Title Company Parties take no

position on the merits of Class Counsel’s application for attorneys’ fees and reimbursement of

expenses. The Title Company Parties shall have no responsibility for or liability relating to (i) the

award or allocation of attorneys’ fees and/or (ii) the reimbursement of expenses to or among Class

Counsel.

13.2 The Class Action Court’s granting any application by Class Counsel for attorneys’

fees and reimbursement of expenses is not a condition of the Settlement. Class Counsel’s request for

attorneys’ fees and reimbursement of expenses is to be considered separately from the Court’s

consideration of whether the Settlement is fair, reasonable, adequate and in the Class’s best interests.

Any order or proceedings related to any request for attorneys’ fees or reimbursement of expenses, or

any appeal from any order or proceedings related thereto, shall not affect or delay the Effective Date

and the finality of the Class Action Approval Order.

14. Dispute Resolution

14.1 The Parties agree that before resorting to litigation they will attempt to resolve

informally any disputes arising under this Agreement through good faith negotiations for a period of

thirty (30) days after written notification of such dispute unless, in any Party’s good faith belief,

more immediate judicial relief is required.


14.2 If any Party to this Agreement fail(s) to honor any of the material provisions,

covenants, or representations contained in this Agreement, any other Party to this Agreement shall

have the right to seek any appropriate remedy, including but not limited to termination of the

Settlement and this Agreement.

15. Other Termination Rights

15.1 In addition to the termination rights in Section 8, the Class Representatives or the

Title Company Parties shall have the right to terminate the Settlement and this Agreement by

providing written notice of such election to the signatories hereto within thirty (30) calendar days of:

(i) the Class Action Court’s refusal to enter the Preliminary Approval Order in

any material respect;

(ii) the Class Action Court’s refusal to approve the Agreement or any material

part of it;

(iii) the Class Action Court’s refusal to enter the Class Action Approval Order in

any material respect, other than with respect to the allocation of the Settlement Amount to the Class

or award of attorneys’ fees and/or the reimbursement of expenses to or among Class Counsel;

(iv) the date on which the Class Action Approval Order is modified or reversed in

any material respect (other than with respect to the allocation of the Settlement Amount to the Class

or award of attorneys’ fees and/or the reimbursement of expenses to or among Class Counsel) by the

Class Action Court or on appeal from the Class Action Court;

(v) the date on which an Alternative Judgment with respect to which none of the

Parties hereto elected to terminate this Settlement is modified or reversed in any material respect

(other than with respect to the allocation of the Settlement Amount to the Class or award of

attorneys’ fees and/or the reimbursement of expenses to or among Class Counsel) by any court of

competent jurisdiction;


(vi) the date on which a Bankruptcy Court order declining or refusing to enter the

Modified Approval Order becomes a Final Order.

(vii) For the avoidance of doubt, a decision by the Class Action Court to award

attorneys’ fees and expenses in an amount less than the amounts applied for by Class Counsel shall

not create a right to terminate the Settlement.

15.2 If this Agreement becomes null and void pursuant to any provision of this Agreement,

including but not limited to Sections 8 or 15 hereof, or is terminated for any other reason by Final

Order or Final Judgment of the Class Action Court or the Bankruptcy Court, then (a) the Parties shall

have all of the rights, defenses, and obligations that they would have had absent this Agreement; and

(b) any and all otherwise applicable statutes of limitations or repose, or other time-related deadlines

or limitations, shall be deemed to have been tolled by virtue of this Agreement for the period from

the Execution Date through the date that is thirty (30) days after this Agreement becomes null and

void. Moreover, if the Agreement becomes null and void pursuant to any provision of this

Agreement, including but not limited to Sections 8 or 15 hereof, or is terminated for any other reason

by Final Order or Final Judgment of the Class Action Court or the Bankruptcy Court, then (i) the

Parties shall not disclose information regarding settlement negotiations and communications leading

up to the Settlement Agreement and (ii) Sections 11.1(a)-(f), 12, of this Agreement shall survive.

16. Miscellaneous

16.1 Each Party agrees to take such steps and to execute any documents as may be

reasonably necessary or proper to effectuate the purpose and intent of this Agreement and to

preserve its validity and enforceability. In the event that any action or proceeding of any type

whatsoever is commenced or prosecuted by any Entity not a Party hereto to invalidate, interpret, or

prevent the validity, enforcement, or carrying out of all or any of the provisions of this Agreement,


the Parties mutually agree, represent, warrant, and covenant to cooperate fully in opposing such

action or proceeding.

16.2 None of the Parties shall be considered the drafter of this Agreement. The Parties

agree that they negotiated this Agreement at arm’s length and in good faith, with each Party

receiving advice from independent legal counsel.

16.3 All of the exhibits attached hereto are hereby incorporated by reference as if fully set

forth herein.

16.4 Titles and captions contained in this Agreement are inserted only as a matter of

convenience and are for reference purposes only. Such titles and captions in no way are intended to

define, limit, expand or describe the scope of this Agreement, nor the intent of any provision thereof.

The recitals contained herein are contractual in nature and form a material part of this Agreement.

16.5 Except as expressly set forth herein, all Parties shall bear their own costs and

expenses incurred in connection with implementing the terms of this Agreement and every aspect of

the Settlement.

16.6 No breach of any provision hereof can be waived by any Party unless in writing. The

waiver by one Party of any breach of this Agreement by any other Party shall not be deemed a

waiver of any other prior or subsequent breach of this Agreement.

16.7 This Agreement cannot be amended, altered or modified except by a written

agreement duly executed by each Party to be charged or its heirs, successors, duly authorized

representative, or assigns.

16.8 This Agreement may be executed in counterpart originals, all of which, when so

executed and taken together, shall be deemed an original and all of which shall constitute one and

the same instrument. Each counterpart may be delivered by email (as a .pdf attachment), and an

emailed signature shall have the same force and effect as an original signature.

EXHIBIT 1

EXHIBIT 1

EXHIBIT 2

EXHIBIT 2

EXHIBIT 3

EXHIBIT 3

f f '

'i!1 .

THIS SETTLEMENT AGREEMENT AND RELEASE (the "Agreement") is made by

and among (1) Gerard A. McHale Jr., as the Liquidation Trustee for and on behalf of the

LandAmerica 1031 Exchange Services, Inc. Liquidation Trust (the "LES Trustee," as more fully

defined below), (2) Bruce H. Matson, as the Liquidation Trustee for and on behalf of the LFG

Liquidation Trust (the "LFG Trustee," as more fully defined below), (3) Fidelity National

Financial, Inc. ("~'NF"), Commonwealth Land Title Insurance Company ("CLTIC"),

Commonwealth Land Title Company ("Commonwealth''), and Fidelity National Title Insurance

Company ("FNTIC"), f/k/a LandAmerica Charter Title Company ("LCTC"), successor by

merger to Lawyer's Title Insurance Corporation ("LTIC") (collectively, the "FNF Objecting

Parties," as more fully defined below), and (4) Certain Underwriters at Lloyd's, London

("Underwriters," as more fully defined below).

Recitals

WHEREAS:

A. LandAmerica Financial Group, Inc. ("LFG," as more fully defined below),

LandAmerica 1031 Exchange Services, Inc. ("LES"), and certain other related entities

(collectively, "Debtors," as defined below) filed voluntary petitions for relief under chapter 11 of

title 11 of the United States Code with the United States Bankruptcy Court for the Eastern

District of Virginia (the "Bankruptcy Court") in 2008 and 2009.

B. Certain subsidiaries of FNF purchased certain non-Debtor subsidiaries of LFG,

including LTIC and CLTIC, while the LFG Bankruptcy Case was pending. By Order dated

December 17, 2008, the Bankruptcy Court approved the sale.

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EXHIBIT 4

EXHIBIT 4

C. The Bankruptcy Court has entered orders confirming the plan for each of the

Debtors (the "Plan"), and such Plan has gone effective.

D. The Plan provides, among other things, for the formation of the LandAmerica

1031 Exchange Services, Inc. Liquidation Trust ("LES Trust"), the LFG Liquidation Trust

("LFG Trust"), and the SD Trusts (as defined below).

E. On December 3, 2009, LES and the LES Trustee entered into a liquidation trust

agreement, which, among other things, appointed the LES Trustee, and on December 7, 2009,

LFG and the LFG Trustee entered into a liquidation trust agreement that, among other things,

appointed the LFG Trustee.

F. Prior to the Bankruptcy Cases, Underwriters issued a primary Insurance

Companies Blanket Bond and Crime Insurance and Professional Liability Insurance Policy and

an excess Insurance Companies Blanket Bond and Crime Insurance and Professional Liability

Insurance Policy for the policy period from December 31, 2007, to December 31, 2008 hearing

policy numbers 07GPOM2481 and 07GPOM2482 respectively (the '`Policies," as further defined

below).

G. Prior to and during the Debtors' Bankruptcy Cases, certain Claims were asserted

against LES and LFG (the "LE5/LFG Claims," as defined below). Damages alleged in

connection with the LES/LFG Claims exceed $300 million in the aggregate, including

consequential damages. The LES/LFG Claims involve, but are not limited to, allegations of

negligence, breaches of fiduciary duties, and conversion. The LES Trust and the LFU Trust

collectively have distributed more than $200 million to date to claimants asserting LES/LFG

Claims. The Trusts or the Debtors claim to have incurred in excess of $12 million in Defense

Costs to date in connection with the LES/LFG Claims.

21398926.1


EXHIBIT 4

EXHIBIT 4

H. Claims also have been asserted against CLTIC, LTIC, and certain of their

subsidiaries, including the Claims asserted in the "Hays Litigation" as defined below (the

"CLTIC/LTIC Claims," as more fully defined below). The CLTIC/LTIC Claims also involve,

but are not limited to, allegations of negligence, breaches of fiduciary duties, and conversion, and

the FNF Objecting Parties allege that these Claims generally arise from the same facts and seek

the same damages as the LES/LFG Claims.

Upon the Plan Effective Date, as set forth in the Plan, (i) certain assets of LES and

LFG were transferred to the Trusts, including LES's and LFG's Claims under the Policies, and

LES and LFG were discharged from the LES/LFG Claims; and (ii) certain assets of Southland

Title of Orange County, Southland Title of San Diego, Southland Title Corporation,

LandAmerica Assessment Corporation, LandAmerica Title Company, LandAmerica Credit

Services, Inc., Capital Title Group, Inc., and LandAmerica OneStop, Inc. (collectively, the "SD

Debtors") were transferred to the SD Trusts (as defined below), including Claims of the SD

Debtors under the Policies.

The Trusts contend that Underwriters are obligated under Section 2 of the Policies

to pay Professional Liability Loss (including Defense Costs) incurred by the Trusts or the

Debtors in connection with the LES/LFG Claims. Underwriters dispute that they are obligated

under the Policies to pay Professional Liability Loss incurred by the Trusts or the Debtors in

connection with the LES/LFG Claims or any other type of Loss incurred by the Trustees, the

Trusts, or the Debtors.

K. The FNF Objecting Parties contend that Underwriters are obligated under

Section 2 of the Policies to pay Professional Liability Loss (including Defense Costs) incurred by

certain of the FNF Objecting Parties in connection with the CL TIC/LTIC Claims. Underwriters

1398926.]


EXHIBIT 4

EXHIBIT 4

dispute that they are obligated under the Policies to pay Professional Liability Loss incurred by

CLTIC, LTIC, and certain of their subsidiaries in connection with the CLTIC/LTIC Claims or

any other type of Loss incurred by any of the FNF Objecting Parties.

L. Policy no. 07GPOM2481 is subject to an aggregate limit of liability of

$20 million, and Policy no. 07GPOM2482 is subject to an aggregate limit of liability of $30

million, for a total of $50 million in aggregate limits under the two Policies combined.

Underwriters contend that the aggregate limits have been reduced by the following payments to

certain of the FNF Objecting Parties (the "Prior Payments"): (1) a payment of $7.75 million in

connection with a claim by Mesa Bank against Capital Title Agency, Inc., now known as

Lawyers Title of Arizona, Inc., and (2) a payment of $1,194,970.94 in connection with a claim

for a fidelity loss by CLTIC and LTIC involving Flagler "Title Company. Underwriters further

contend, based on the Prior Payments, that the remaining aggregate limits of the Policies are no

greater than $41,055,029.06 in toto (the "Available Coverage," as defined below). The Trusts

and the FNF Objecting Parties dispute Underwriters' contention that the aggregate limits of the

Policies have been reduced below $50 million so as to limit, to the Available Coverage, the

amount of Professional Liability Loss (including Defense Costs) recoverable by the Trusts in

connection with the LES/LFG Claims and by CLTIC, LTIC, and certain of their subsidiaries in

connection with the CLTIC/LTIC Claims. The Trusts and the FNF Objecting Parties further

dispute their respective entitlements to the Available Coverage and other potentially available

coverage under the Policies.

M. On or about January 11, 2012, the LES Trustee, the LFG Trustee, and

Underwriters entered into a settlement agreement and release (the "Trustees/Underwriters

Agreement") which provided, among other things, that (1) Underwriters would pay the Trusts

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$37,855,029.06 to resolve the Trusts' claims against Underwriters for coverage under the

Policies and Prior Years' Policies for the LES/LFG Claims, (2) the Available Coverage (in the

amount of $41,055,029.06, referred to in the Trustees/Underwriters Agreement as the "LES/LFG

Available Coverage") would be deemed exhausted, (3) the parties would provide each other with

mutual releases, and (4) if the Trustees/Underwriters Agreement was approved pursuant to its

terms, the Trusts would not make affirmative claims against Lawyers Title of Arizona, Inc.,

CLTIC or LTIC for the Prior Payments. The Trusts filed a motion to approve the

Trusts/Underwriters Agreement on January 26, 2012 (the "Approval Motion")

N. The FNF Objecting Parties filed an objection to the Approval Motion on February

16, 2012 (the "Objection"). Among other things, the FNF Objecting Parties objected to Section

5.5 of the Trustees/Underwriters Agreement, which provides that the Available Coverage

(referred to in the Trustees/Underwriters Agreement as the "LES/LFG Available Coverage") is

deemed exhausted. The FNF Objecting Parties contended that this provision improperly relieves

Underwriters of approximately $3.2 million in coverage obligations. The Trustees and

Underwriters disagree with this contention and the other alleged grounds for disapproval of the

Trustees/Underwriters Agreement set forth in the Objection. The Trustee also contended, inter

alia, that if the Approval Motion is not granted, the Trusts would be entitled to recover from the

FNF Objecting Parties some or all of the Prior Payments. The FNF Objecting Parties and

Underwriters dispute this. As set forth below, this Agi°eement is intended to settle and resolve

the dispute regarding Underwriters' actual exhaustion of the Policies as well as the balance of the

Objection, pursuant to the terms set forth below.

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NOW THEREFORE, in consideration of the mutual promises contained herein and other

good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,

the Parties hereby agree as follows:

Rl7.7~ ~l► i ~l►Y'11

1. 12ules of Construction and Definitions. The following rules of construction and

definitions apply only to this Agreement, including the exhibits to this Agreement. The above

recitals are fully incorporated within and constitute binding terms of this Agreement to the same

extent as if set forth below.

1.1. The definitions below apply to capitalized terms wherever those terms appear in

this Agreement, including the prefatory paragraph and recitals above, this Section 1, the sections

below and any exhibits. If capitalized terms in the prefatory paragraph and recitals above, the

sections below, and any exhibits hereto, are not defined in this Section 1, they have the meanings

ascribed to them as set forth in the relevant sections of this Agreement, the

Trustees/Underwriters Agreement, or the Policies, as the case may be. Each defined term stated

in the singular shall include the plural and each defined term stated in the plural shall include the

singular. The word "including'' means "including but not limited to." The word "includes"

means "includes but is not limited to." The word "herein" means the entirety of this Agreement,

including any exhibits hereto. The word "or" means "and/or" as appropriate. The definitions in

the Trustees/Underwriters Agreement shall continue to apply unless specifically modified herein.

1.2. "Available Coverage" means $41,055,029.06 in coverage under the Policies,

which represents $50 million in total aggregate limits under the Policies less the Prior Payments.

For the avoidance of doubt, and without linnitation, this deduction is solely for purposes of this

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Agreement and does not constitute an agreement or concession regarding the amount of coverage

available to the Insureds, or any of them, in the event that the Modified Approval Order does not

become a Final Order or this Agreement otherwise becomes null and void according to its terms.

1.3. "Bankruptcy Cases" means the chapter ll cases fled by LFG, LES and the other

Debtors in the United States Bankruptcy Court for the Eastern District of Virginia.

1.4. `Bankruptcy Code" means title 11 of the United States Code, 11 U.S.C. §§ 101 et

seq., as amended from time to time.

1.5. "Bankruptcy Court" means the United States Bankruptcy Court for the Eastern

District of Virginia and, to the extent it exercises jurisdiction over the Bankruptcy Cases, the

United States District Court for the Eastern District of Virginia, and any other court exercising

appellate jurisdiction over said courts.

1.6. "CLTIC/LTIC Claims" means all Claims made by any Person against any of the

FNF Objecting Parties, including CLTIC and LTIC, or any affiliate thereof, by reason of

allegations based upon, arising out of, attributable to, resulting from, or related to the acts or

omissions of any Insureds with respect to (i) auction rate securities or (ii) the liquidity of LES or

LFG from February 2008 through November 26, 2008, including Claims which were asserted by

former customers of LES or were raised by Government investigations relating thereto. Such

Claims include the Claims seeking lost exchange funds, tax liabilities and other damages. Such

Claims include the Claims asserted in: (i) the Hays Litigation; (ii) the case captioned Barbosa v.

Commonwealth Land Title Inszrrance Company (pending in Superior Court for San Joaquin

County, California); (iii) the case captioned Farahzad v. Lawyers Title Ins. Co. et al. (pending as

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part of the MDL in USDC, South Carolina); and (iv) the case captioned Ge~minaro v. Albef°t

WatteNSOn and Tammy Bentz (pending in Allegheny County Court of Common Pleas,

Pennsylvania).

1.7. "Claim" means any past, present, or future claim, demand, action, cause of action,

assertion of right or obligation, suit, or liability of any kind or nature whatsoever, whether at law

or in equity, known or unknown, asserted or unasserted, anticipated or unanticipated, accrued or

unaccrued, foreseen or unforeseen, fixed or contingent, or liquidated or unliquidated, whether

seeking damages (including compensatory, consequential, punitive, exemplary, bad faith, extra-

contractual or statutory damages) or equitable, mandatory, injunctive, or any other type of relief,

including cross-claims, counterclaims, third-party claims, suits, lawsuits, administrative

proceedings, notices of liability or potential liability, or arbitrations. To the extent not included

in the preceding sentence, "Claim" also includes "claim" as defined in Bankruptcy Code Section

101(5) and "Claim" as defined in the Policies.

1.8. "Class" means the class or classes certified for settlement purposes in the Hays

Litigation, but which shall not include any Person who as of the entry of the Class Action

Approval Order has a separate binding agreement with any of the FNF Objecting Parties to settle

their respective CLTIGLTIC Claims.

1.9. "Class Action Approval Order" means an order entered by a court with

jurisdiction over the Hays Litigation, which approves the Class Settlement.

1.10. "Class Settlement" means a mutually acceptable written agreement between the

Hays Plaintiffs, individually and on behalf of the proposed Class or Classes, and the FNF

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Objecting Parties, to settle the Hays Litigation, which shall include the payment of $11 million

by the FNF Objecting Parties to the Class (the "Hays Settlement Payment") and provides that

any contingent fee to counsel for the Class shall not be applied to $2 million of this $11 million.

1.11. "Days" means calendar days unless otherwise specified.

1.12. "Debtors" means LES, LFG, Southland Title of Orange County, Southland Title

of San Diego, Southland Title Corporation, LandAmerica Assessment Corporation,

LandAmerica Title Company, LandAmerica Credit Services, Inc., Capital Title Group, Inc., and

LandAmerica OneStop, Inc.

1.13. ``Execution Date" means the earliest date on which all of the Parties have

executed and delivered this Agreement.

1.14. "Final Order" means an order as to which the time to appeal, petition for

certiorari, or move for reargument or rehearing has expired and as to which no appeal, petition

for certiorari, request for a stay, or other proceedings for a stay, reargument or rehearing shall

then be pending, or as to which any such right to appeal, petition for certiorari, stay, reargue; or

rehear shall have been waived in writing and withdrawn in accordance with the applicable rules

of the court.

1.15. "FNF Insurance Claims" means any and all Claims or Interests of any of the FNF

Objecting Parties against Underwriters for or with respect to insurance coverage or other rights

or obligations under or with respect to the Policies or Prior Years' Policies for or with respect to

the CLTIC/LTIC Claims, including any and all such Claims, whether direct or derivative, that

the FNF Objecting Parties (or any of them) are legally entitled to release, whether for or with

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respect to Loss, defense, indemnity, bad faith, improper or unfair claims handling, any attorneys'

fees, costs and expenses incurred by any of the FNF Objecting Parties, or interest of any sort.

1 1 h. "FNF (~hjecting Parties" means Fidelity National Financial, Inc. ("FNF"),

Commonwealth Land Title Insurance Company ("CI,TIC"), Commonwealth Land Title

Company ("Commonwealth"), and Fidelity National Title Insurance Company ("FNTIC"), also

f/k/a LandAmerica Charter Title Company ("LCTC"), successor by merger to Lawyer's Title

Insurance Corporation ("LTIC"), and the successors and assigns of all of the foregoing.

1.17. "FNF Settlement Payment" means the payment of $3,200,000.00 to be paid by

Underwriters to FNF as described in Paragraph 5.2 herein.

1.18. "Hays Litigation" means the purported class action captioned In re: IRS Section

1031 Tax Deferred Exchange Litigation, Vivian R. Hays, et al. v. Commonwealth Land Title

Insurance Company, et al., MDL No. 8:09-mn-2054-JFA, Case No. 3:11-cv-00619-JFA, which

was pending in the United States District Court for the District of South Carolina as part of an

MDL until March 12, 2012, when an Order conditionally remanding the case back to the

transferor court, the United States District Court for the Northern District of California, was

entered. The Hays Litigation has been remanded back to the transferor court.

1.19. "Insured" means "Company" as defined in the Policies. The Policies define

``Company" as "LandAmerica Financial Group Inc. and its subsidiaries."

1.20. "Interests" means any Claim, lien, encumbrance, right or interest of any kind or

nature based upon, arising out of, derived from, or attributable to, directly or indirectly, the

Policies, the proceeds of the Policies, the insurance relationship, actual or alleged, arising out of

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the Policies, any purported representations allegedly made by Underwriters or acquiesced to by

Underwriters with respect to the Policies, or the investigation, consideration, handling or

adjustment of Claims made to Underwriters under the Policies.

1.21. "LES Settlement Payment" means the $37,855,029.06 paid by Under~~riters to

the LES Trustee as described in paragraph 5.1 herein.

1.22. "LES Trustee" means Gerard A. McHale, Jr., solely in his capacity as trustee for

and on behalf of the LES Trust, and his successors and assigns.

1.23. "LES/LFG Claims" means all Claims made against LES or LFG by reason of

allegations based upon, arising out of, attributable to, resulting from, or related to the acts or

omissions of any Insureds with respect to (i) auction rate securities or (ii) the liquidity of LES or

LFG from February 2008 through November 26, 2008, which Claims were asserted prior to or

during the Debtors' Bankruptcy Cases by former customers of LES or were raised by

Government investigations relating thereto. Such Claims include Claims seeking lost exchange

funds, tax liabilities and other damages.

1.24. "LFG" means LandAmerica Financial Group, Inc. and not any of its subsidiaries.

1.25. "LFG Trustee" means Bruce H. Matson, solely in his capacity as the Liquidation

Trustee for and on behalf of the LFG Trust, and his successors and assigns.

1.26. "Modified Approval Order'" means an order entered by the Bankruptcy Court

approving the terms of the settlement contained in the Trustees/Underwriters Agreement and

containing language in the form of Exhibit 1 hereto, without any material modifications to the

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portion thereof which begins "It is ordered, adjudged, and Decreed that" and continues to the

end, except as may be agreed to in writing by each of the Parties.

1.27. ``Parties'' means, collectively, the LES Trustee, the LFU Trustee, the FNF

Objecting Parties, and Underwriters.

1.28. "Payment Release Date" means the seventh day after the earliest date when all of

the following have occurred: (a) the Modified Approval Order has become a Final Order; (b) the

Class Action Approval Order has become a Final Order; and (c) no member of the Class having

opted out with finality from the Class Settlement or certification by counsel for the FNF

Objecting Parties that the FNF Objecting Parties accept the number of opt outs in accordance

with their rights under the terms of the Class Settlement (notwithstanding the foregoing, the FNF

Objecting Parties may waive this condition (c) at their option). The term "Payment Release

Date" as used in the Trustees/Underwriters Agreement is modified for purposes of that

agreement to conform in all respects to the definition set forth in this Section 1.28.

1.29. "Person" means an individual, a corporation, a partnership, a joint venture, an

association, a joint stock company, a limited liability company, a limited liability partnership, an

estate, an unincorporated organization, a trust, a class or group of individuals, or any other entity

or organization, including any federal, state, or local governmental or quasi-governmental body

or political subdivision, department, agency, or instrumentality thereof.

1.30. "Plan" means the Joint Chapter 11 Plan of LandAmerica Financial Group, Inc.

and its Affiliated Debtors, dated November 16, 2009, as may be amended from time to time.

1.31. "Plan Effective Date" means December 7, 2009.

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1.32. "Policies" means Underwriters' primary Insurance Companies Blanket Bond and

Crime Insurance and Professional Liability Insurance Policy, numbered 07GPOM2481, with

policy period from December 31, 2007, to December 31, 2008, and Underwriters' excess

Insurance Companies Blanket Bond and Crime Insurance and Professional Liability Insurance

Policy, numbered 07GPOM2482, with policy period from December 31, 2007, to December 31,

2008, under which LES, LFG, and LFG's subsidiaries, including CLTIC, LTIC, and their

respective subsidiaries, are Insureds. Policy no. 07GPOM2481 is subject to an aggregate limit of

liability of $20 million, and Policy no. 07GPOM2482 is subject to an aggregate limit of liability

of $30 million, for a total of $50 million in aggregate limits under the two Policies combined.

1.33. "Prior Years' Policies" means the insurance policies of which the Policies are

renewals or replacements, but only to the extent issued or subscribed by Underwriters.

1.34. "SD Trusts" means Southland Title of Orange County Liquidation Trust,

Southland Title of San Diego Liquidation Trust, Southland Title Corporation Liquidation Trust,

LandAmerica Assessment Corporation Liquidation Trust, LandAmerica Title Company

Liquidation Trust, LandAmerica Credit Services, Inc. Liquidation Trust, Capital Title Group,

Inc. Liquidation Trust, and LandAmerica OneStop, Inc., Liquidation Trust, each of which shall

have the meaning as defined by the Plan.

1.35. "Supplemental Motion for Modified Approval Order" means a motion filed by

the LES Trustee with the Bankruptcy Court seeking entry of the Modified Approval Order in the

form attached hereto as Exhibit 1 in lieu of the Approval Order requested in the Approval

Motion as Exhibit B thereto ("Approval Order"). For the avoidance of doubt, the Supplemental

Motion for Modified Approval Order supplements but does not replace the Approval Motion,

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which shall remain pending. It is the intention of the Parties that the Bankruptcy Court shall

consider the two motions in tandem.

1.36. "Trusts" mean, collectively, the LES Trust and the LFG Trust.

1.37. "Trust Insurance Claims" means any and all Claims or Interests of LF,S, LFG, the

Trustees, and the Trusts against Underwriters for or with respect to insurance coverage or other

rights or obligations under or with respect to the Policies or Prior Years' Policies for or with

respect to the LES/LFG Claims, including any and all such Claims, whether direct or derivative,

that the Trusts are legally entitled to release, whether for or with respect to Loss, defense,

indemnity, bad faith, improper or unfair claims handling, any attorneys' fees, costs and expenses

incurred by the Trustees, the Trusts, LES and LFG, or interest of any sort.

1.38. "Trustees" means, collectively, the LES Trustee and the LFG Trustee.

1.39. "Underwriters" means all the underwriters, members; or Names at Lloyd's,

London, who, through their participation in syndicates, severally subscribed to either or both of

the Policies, and their present and former parents, affiliates, shareholders, officers, directors,

employees, representatives, attorneys, predecessors, successors, heirs, executors, administrators,

and assigns, all solely in their capacities as such.

1.40. '`Unknown Claims" means any and all Claims which any Party hereto does not

know or suspect to exist in his, her, or its favor at the time of the Payment Release Date, which if

known by him, might have affected his, her or its decisions) with respect to this Agreement.

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1.41. As used herein, the terms "Defense Costs," "Professional Liability Loss,"

"Subsidiary,'' and "Loss'" shall have the meanings ascribed to such terms in Section 2 of the

Policies.

2. Scope

2.1. The purpose of this Agreement is to resolve the Objection. Except as specifically

provided herein, nothing in this Agreement modifies or supersedes the Trustees/Underwriters

Agreement, which remains in full force and effect.

3. ~'ayment Release Date and Void Ab Initio Provisions

3.1. For the avoidance of doubt, it is understood and agreed by the Parties that the

entry of the Modified Approval Order and the occurrence of it becoming a Final Order, are

express conditions precedent to the occurrence of the Payment Release Date.

3.2. For the avoidance of doubt, it is understood and agreed by the Parties that

(a) entry of the Class Action Approval Order, and the occurrence of it becoming a Final Order,

and (b) no member of the Class having opted out with finality from the Class Settlement or

certification by counsel for the FNF Objecting Parties that the FNF Objecting Parties accept the

number of out outs in accordance with their rights under the terms of the Class Settlement

(notwithstanding the foregoing, the FNF Objecting Parties may waive this condition (b)), are

express conditions precedent to the occurrence of the Payment Release Date.

3.3. This Agreement, except for this Section 3.3, and Sections 3.4, 5.4, 5.5, 6.17, 9.1,

9.2, 9.3, and 10 below, which shall not be null and void and shall remain in full force and effect,

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shall become null and void ab initio and of no further force or effect ("null and void''): (a) upon

the date that an order of the Bankruptcy Court declining or refusing to enter the Modified

Approval Order becomes a Final Order; (b) upon the date that an order of the court with

jurisdiction over the Hays Litigation declining or refusing to approve the Class Settlement

becomes a Final Order; (c) in the sole discretion of the LES Trustee if either (i) a motion for

preliminary approval of the Class Settlement has not been filed on or before May 15, 2012, or

(ii) the court with jurisdiction over the Hays Litigation has not conducted a hearing for final

approval of the Class Settlement on or before September 30, 2012; (d) in any Party's sole

discretion, if one year has passed from the filing date of the Supplemental Motion for Modified

Approval Order and the Modified Approval Order has not been entered, then upon the earliest

date written notice by the Party declaring this Agreement null and void has been provided to all

other Parties; (e) in any Party's sole discretion, if one year has passed from the filing of the

motion for preliminary approval of the Class Settlement, and the Class Settlement Approval

Order has not been entered, then upon the earliest date written notice by the Party declaring this

Agreement null and void has been provided to all other Parties; or (f~ by written agreement of all

of the Parties. Notice declaring this Agreement null and void pursuant to this Section 3.3 shall

be provided by written notice pursuant to Section 10 below.

3.4. If this Agreement becomes null and void pursuant to Section 3.3, then, without

limitation, (a), except for this Section 3.4, and Sections 3.3, 5.4, 5.5, 6.17, 9.1, 9.2, 9.3, and 10

below, which shall not be null and void and shall remain in full force and effect, the Parties shall

have all of the Claims, Interests, rights, defenses, and obligations under or with respect to the

Policies and Prior Years' Policies, the Trustees/Underwriters Agreement, the Trust Insurance

Claims, the FNF Insurance Claims, the CLTIC/LTIC Claims, the LES/LFG Claims, the

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Approval Motion, the Objection, and the Prior Payments that they would have had absent this

Agreement; (b) any and all otherwise applicable statutes of limitations or repose, or other time-

related deadlines or limitations pertaining to the Claims, Interests, rights, defenses, and

obligations of the Parties, shall be deemed to have been tolled for the period from the Execution

Date through the date that is eight (8) weeks after this Agreement becomes null and void; (c) the

Trusts and the FNF Objecting Parties shall have whatever rights they would have had absent this

Agreement to or with respect to the full $50 million in aggregate limits of the Policies in

coverage for Professional Liability Loss (including Defense Costs) incurred by the Trusts, LES,

or LFG in connection with the LES/LFG Claims and by the FNF Objecting Parties in connection

with the CLTIC/LTIC Claims, respectively; (d) Underwriters shall have whatever rights,

defenses and obligations they would have had absent this Agreement with respect to the same;

(e) no Party or other Person shall use the fact of this Agreement, the Class Settlement, the

Supplemental Motion for Modified Approval Order, the Modified Approval Order, their

respective terms, or any communications between or among the Parties in connection therewith

for any purpose in any dispute over the Trustees/Underwriters Agreement, the Approval Motion,

the Approval Order, the Objection, or any Party's or Underwriters' respective rights or

obligations with respect to coverage under the Policies, the Prior Years' Policies, or any other

policies issued by Underwriters; and (~ the Approval Motion shall be placed back on the

calendar of the Bankruptcy Court, with all Parties reserving all positions and rights with respect

thereto (including the FNF Objecting Parties' Objection and the Trusts' and Underwriters'

responses thereto), and proceedings thereon in the Bankruptcy Court shall resume subject to

mutual agreement among the Parties concerning scheduling issues or, in the absence of

agreement, a scheduling order by the Bankruptcy Court with respect thereto.

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4. Court Approval

4.1. No later than sixty (60) Days after the Execution Date, the LES Trustee or both

Trusties shall file the Supplemental Motion for Modifi?.~l Approval Order seeking entry of the

Modified Approval Order. The Trustees shall provide a draft of the Supplemental Motion for

Modified Approval Order to Underwriters and the FNF Objecting Parties for review and

comment at least three (3) business days in advance of such filing. Underwriters and the FNF

Objecting Parties consent to entry of the Modified Approval Order and will cooperate with the

Trustees to obtain entry thereof. Unless and until this Agreement become null and void, the FNF

Objecting Parties will not oppose the Approval Motion, and the Parties will not file any other

actions or motions against one another concerning any matter relating to the subject matter of

this Agreement, except to enforce this Agreement.

4.2. Notice of the Supplemental Motion for Modified Approval Order and the hearing

thereon shall be served by the LES Trustee and the LFG Trustee to all parties in interest pursuant

to Bankruptcy Rules 2002 and 6004, and on all parties who filed an appearance with respect to,

or objected to, the Approval Motion, and such other parties entitled to receive notice pursuant to

this Court's December 23, 2008, amended administrative order entered in these cases, and all

other parties in interest as required by the applicable provisions of the Bankruptcy Code and

Rules. Service shall be made to the extent reasonably possible and to the last known address of

said Persons.

4.3. The Trustees, the FNF Objecting Parties, and Underwriters will cooperate in

connection with any objections filed to the Supplemental Motion for Modified Approval Order,

and will also cooperate as needed to fully effectuate the intent of this Agreement.

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5. Payment and 12elease of the I.ES Settlement Payment and the FI~tFSettlement Payment

5.1. Underwriters timely paid the LES Settlement Payment in accordance with

Section 4.1 of the Trustees/Underwriters Agreement on January 20, 2012, and the LES Trustee is

holding the LES Settlement Payment in trust and escrow pursuant to Section 4.2 of the

Trustees/Underwriters Agreement pending the occurrence of the Payment Release Date.

5.2. No later than twenty-one (21) Days after the Execution Date, Underwriters shall

pay the FNF Settlement Payment by wire transfer to a bank account designated by FNF as

follows:

Bank Name: Harris BankABA Ref.: 071000288Account Name: Chicago Title InsuranceAccount No.: 2007862

5.3. Within five (5) business days after receipt of the FNF Settlement Payment, FNF

will deposit the FNF Settlement Payment into a bank account designated by FNF to hold the

FNF Settlement Payment in escrow pending its release pursuant to Section 5.5. Except for the

obligation to timely pay the FNF Settlement Payment as set forth in Section 5.2, UnderwriCers

shall have no further duties or obligations as concerning the escrow established to the hold the

FNF Settlement Payment, including any obligations to timely report or file tax returns. The FNF

Settlement Payment shall be segregated from any other assets of FNF, pending its release

pursuant to Section 5.5. At Underwriters' reasonable request, FNF will provide an accounting of

the FNF Settlement Payment during the period it is held by FNF pursuant to this Section 5.3.

5.4. Notwithstanding anything in the Trustees/Underwriters Agreement to the

contrary, the LES Settlement Payment (less customary and reasonable expenses of any

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depository or financial institution or any tax liabilities ("Expenses") or investment losses

("Losses") incurred in connection with holding the LES Settlement Payment in trust or escrow),

shall be released to the Trustees immediately upon the Payment Release Date as defined in

Section 1.28 above, unless this Agreement becomes null and void pursuant to Section 3 above, in

which case the LES Settlement Payment shall continue to be held by the LES Trustee under the

terms of the Trustees/Underwriters Agreement and the definition of "Payment Release Date" set

forth in that agreement shall thereafter apply in all respects to that agreement.

5.5. The FNF Settlement Payment (less any Expenses or Losses incurred in

connection with holding the FNF Settlement Payment in escrow) shall be released to FNF

immediately upon the Payment Release Date, unless this Agreement becomes null and void

pursuant to Section 3 above, in which case the FNF Settlement Payment (less any Expenses or

Losses incurred in connection with holding the FNF Settlement Payment in escrow, which

amounts shall be paid from the FNF Settlement Payment) shall be promptly released to

Underwriters. In the event the FNF Settlement Payment is released to Underwriters as set forth

in this Section 5.5, and at Underwriters' reasonable request, FNF will provide an accounting of

the FNF Settlement Payment during the period it is held by FNF pursuant to this Section 5.5.

5.6. Except as provided in Sections 5.5 of this Agreement, Underwriters shall not seek

reimbursement of the FNF Settlement Payment or any part thereof, directly or indirectly, from

any Person, including the Trusts, Trustees, the Debtors, any non-Party insurers of the Debtors,

any of the FNF Objecting Parties, or any other Person, whether by way of a Claim for

contribution, indemnification, subrogation, retrospective premium, deductible, or otherwise;

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provided that nothing in this Section 5.6 shall preclude Underwriters from seeking

reimbursement of such amounts from its reinsurers, solely in their capacities as such.

~6. R~IeasQS, T~ermin~ti4n ~f PQ~i~cy ~ight,c, ~rer~ Fxhaustinn ~f AvailableCoverage

6.1. ~l~F' Objecting Parties' Release of Underwriters: From and after the

Payment Release Date, and without further action by any Party, the FNF Objecting Parties, on

behalf of themselves and any and all of their parents, subsidiaries, or affiliates and their

respective directors, officers, employees, agents, and attorneys, shall fully, finally, and

completely release and waive any and all Claims and Interests of the FNF Objecting Parties

against Underwriters and their parents, subsidiaries, or affiliates and their respective directors,

officers, employees, agents, and attorneys, for or with respect to insurance coverage, rights, or

obligations under or with respect to (a) the Policies, including without limitation the FNF

Insurance Claims, and (b) the FNF Insurance Claims as concerning the Prior Years' Policies,

which releases include any and all such Claims or Interests, whether direct or derivative, that the

FNF Objecting Parties are legally entitled to release, whether for or with respect to Loss,

defense, indemnity, bad faith, improper or unfair claims handling, any attorneys' fees, costs and

expenses incurred by the FNF Objecting Parties, or interest of any sort. Notwithstanding

anything in this Section 6.1 to the contrary, nothing in this release shall release any Claim which

any of the FNF Objecting Parties or their affiliates have or may have with respect to any of the

Prior Years' Policies, except to the extent such Claims constitute FNF Insurance Claims.

6.2. ~Tnderwriters' Release of FNF Objecting Parties< From and after the Payment

Release Date, and without further action by any Party, Underwriters, on behalf of themselves and

any and all of their parents, subsidiaries, or affiliates and their respective directors, of~ticers,

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employees, agents and attorneys, shall fully, finally, and completely release and waive any and

all Claims or Interests of Underwriters against the FNF Objecting Parties and any of their

parents, subsidiaries, or affiliates and their respective directors, officers, employees, agents and

attorneys for or with respect to insurance coverage, rights, or obligations under or with respect to

(a) the Policies, including without limitation the FNF Insurance Claims, and (b) the FNF

Insurance Claims as concerning the Prior Years' Policies, which releases include any and all

such Claims or Interests, whether direct or derivative, that Underwriters are legally entitled to

release, whether for or with respect to Loss, defense, indemnity, bad faith, improper or unfair

claims handling, attorneys' fees, costs and expenses incurred by Underwriters, or interest of any

sort. Notwithstanding anything in this Section 6.2 to the contrary, nothing in this release sha11

release any Claim which any of the Underwriters have or may have with respect to any of the

Prior Years' Policies, except to the extent such Claims involve FNF Insurance Claims.

6.3. Trusts' Release of FNF Objecting Parties: From and after the Payment Release

Date, and without further action by any Party, the Trustees, on behalf of themselves and each of

the Trusts (including all beneficiaries of the Trusts, solely in their capacities as such and solely

with respect to Claims the beneficiaries of the Trusts could bring on behalf of the Trusts, and,

respectively, LES and LFG), shall fully, finally, and completely release and waive any and all

Claims and Interests of LES, LFG, the Trustees, and the Trusts against the FNF Objecting Parties

and their parents, subsidiaries, and affiliates, but solely in their capacities as such, and all of their

directors, officers, employees, agents, and attorneys, but solely in their capacities as such, (a) for

or with respect to insurance coverage, rights, or obligations under or with respect to the Policies

or the Prior Years' Policies (including, for the avoidance of doubt, the proceeds thereof ,and (b)

for or with respect to the LES/LFG Claims or the CLTIC/LTIC Claims, including any and all

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such Claims or Interests, whether direct or derivative, that the Trusts are legally entitled to

release, whether for or with respect to damages, loss, defense, indemnity, contribution, attorneys'

fees, costs, and expenses incurred by LES, LFG, the Trustees, and the Trusts, or interest of any

sort.

6.4. F'I~1F Objecting Parties' Release of Trusts: From and after the Payment Release

Date, and without further action by any Party, the FNF Objecting Parties shall fully, finally, and

completely release and waive any and all Claims and Interests of the FNF Objecting Parties and

their parents, subsidiaries, and affiliates against LES, LFG, the Trustees, the Trusts, the SD

Trusts, the SD Trustees, and their directors, officers, employees, agents, and attorneys, but

solely in their capacities as such, (a) for or with respect to insurance coverage, rights, or

obligations under or with respect to the Policies or the Prior Years' Policies (including, for the

avoidance of doubt, the proceeds thereo f and (b)for or with respect to the LES/LFG Claims and

the CLTIGLTIC Claims, including any and all such Claims or Interests, whether direct or

derivative, that the FNF Objecting Parties are legally entitled to release, whether for or with

respect to damages, loss, defense, indemnity, contribution, attorneys' fees, costs, and expenses

incurred by the FNF Objecting Parties, or interest of any sort.

6.5. Notwithstanding anything in this Section 6 to the contrary, nothing in this

Agreement releases any directors, officers, employees, agents or attorneys of any FNF Objecting

Party for any liability for any act or omission prior to December 17, 2008 but solely in such

capacity for a party other than an FNF Objecting Party, which other parties includes LES and

LFG. Notwithstanding anything to the contrary set forth in this Agreement, nothing in this

agreement shall: (i) supersede, amend, or modify, or be deemed or construed to supersede,

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amend or modify, in any respect the Settlement and Mutual Release Agreement dated September

9, 2009 between, among others, FNF and LFG, as approved by order of the Bankruptcy Court

dated September 14, 2009. both of which shall remain in full force and effect; or (ii) release any

claims currently asserted in the Matson v. Alpert, et crl. case, Adversary Proceeding Number 11-

03168 (KRH), pending in Case No. 08-35994 (KRH) before the Bankruptcy Court for the

Eastern District of Virginia.

6.6. With respect to any and all Claims released hereby, the Parties stipulate and agree

that upon the Payment Release Date, they shall expressly waive and relinquish to the fullest

extent permitted by law, and by operation of the Modified Approval Order, shall have expressly

waived and relinquished, any and all provisions, rights, and benefits conferred by federal law,

any law of any state or territory of the United States, or principle of common law, which is

similar, comparable, or equivalent to California Civil Code § 1542, which provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICHTHE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HISOR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,WHIG-~ IF KNOWN BY HIM OR HER MUST HAVE MATERIALLYAFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

6.7. It is the intention of the Parties that, notwithstanding the provisions of

Section 1542 or any similar provisions, rights and benefits conferred by law, and

notwithstanding the possibility that the Parties or their counsel may discover or gain a more

complete understanding of the facts, events or law that. if presently known or fully understood,

would have affected the decision to enter into this Agreement, any and all release of Claims,

including Unknown Claims, shall be fully, finally, and forever settled. The Parties acknowledge

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that the inclusion of Unknown Claims herein was separately bargained for and was a key and

material element of this Agreement.

6.8. Notwithstanding anything in this Agreement to the contrary, nothing in this

Agreement shall release or waive any Claim or defense or otherwise limit in any way the right of

the FNF Objecting Parties to assert, against any Person that is not providing herein a release of

the FNF Objecting Parties or any person that is not receiving herein a release from the FNF

Objecting Parties (a "Non-Released Person"), any all Claims, defenses, or arguments, including

but not limited to Claims for indemnity or contribution, and including but not limited to any

defenses or arguments heretofore asserted by the FNF Objecting Parties in the Hays Litigation or

in the Objection, but the FNF Objecting Parties may assert such Claims, defenses, or arguments

solely in the event and to the extent that any Non-Released Person initiates a lawsuit or other

legal action against any of the FNF Objecting Parties. Nothing in this Section 6.8 shall affect the

application of any injunction, bar, or other defense provided under the Plan or the orders

confirming the Plan.

6.9. Upon the Payment Release Date, the FNF Objecting Parties shall not seek

reimbursement of the Hays Settlement Payment directly or indirectly from the LES "Trust, the

LFG Trust, the Class members, any non-party insurers of LES or LFG, or any other Person.

whether by way of a claim for contribution, indemnification, subrogation, insurance coverage, or

otherwise.

6.10. On or prior to the Execution Date, the Trustees will obtain an executed release by

the SD Trusts substantially in the form of Exhibit 2 hereto, which the Trustees will hold in

escrow and deliver to the FNF Objecting Parties upon the Payment Release Date.

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6.11. The Parties mutually warrant and covenant not to sue one another or assign any

rights to any otiher Person in connection with the Claims and Interests released in Sections 6.1

through 6.4 above.

6.12. Upon the occurrence of the Payment Release Date, the Available Coverage shall

be deemed fully, finally, actually, and properly exhausted as to LES, LFG, the FNF Objecting

Parties, and all other Insureds under the Policies.

6.13. Nothing in this Agreement (except Sections 3.3 and 3.4 above to the extent

applicable) is intended to, or shall, release, waive, or otherwise affect the Parties' rights and

obligations based upon or arising under this Agreement.

6.14. Nothing in this Agreement shall constitute a release, waiver, or assignment of any

of (a) Underwriters' rights against their reinsurers in their capacities as such, or (b) the Debtors',

Trusts', or Trustees' rights against any Person other than the FNF Objecting Parties,

Underwriters or against any insurer other than Underwriters, or (c) FNF's rights against any

Person other than the Debtors, the Trusts, the Trustees, the SD Trusts, the SD Trustees or

Underwriters.

6.15. Notwithstanding anything in this Agreement to the contrary, nothing in this

Agreement shall waive any right, obligation, privilege, defense, or position that the Parties may

have asserted or might assert in connection with any Claim, matter, Person, or insurance policy

outside the scope of this Agreement.

6.16. The FNF Objecting Parties agree that, from and after the Payment Release Date:

(a) all outsCanding tenders of Claims by the FNF Objecting Parties to Underwriters under the

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Policies for defense or indemnity shall be deemed finally and irrevocably withdrawn; (b) the

FNF Objecting Parties will not tender any further Claims to Underw=riters under the Policies;

(c) the FNF Objecting Parties will not request that Underwriters pay under the Policies for any

settlements or judgments incurred by the FNF Objecting Parties; (d) the FNF Objecting Parties

will not assert an affirmative Claim against any other Person for amounts paid or to be paid by

Underwriters under the Policies, including payments made to or on behalf of LES, LFG, the

Trustee, and the Trusts; and (e) Underwriters shall have no obligations under the Policies to pay

Loss in relation to, handle, object to, or otherwise respond to any Claims against the FNF

Objecting Parties. For avoidance of doubt, nothing in this Section 6.16 is intended to withdraw

any Claim of the FNF Objecting Parties or their affiliates which has been noticed to

Underwriters under the Prior Years' Policies, except to the extent such Claims constitute FNF

Insurance Claims.

6.17. The Parties agree that each will be responsible for all attorneys' fees, costs, and

expenses incurred by it in connection with the negotiation, execution, and performance of this

Agreement.

7, Representations and Warranties of the Parties

7.1. Each of the Parties separately represents and warrants that (1) it owns the Claims

it is releasing, (2) the Claims it is releasing have not been assigned, transferred, encumbered, or

hypothecated to any Person, and (3) it has the requisite power and authority to enter into this

Agreement, to release the Claims it is releasing pursuant to this Agreement, and to perform the

obligations imposed on it by this Agreement, save only for the entry of the Modified Approval

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Order and it becoming a Final Order, the entry of the Class Approval Order and it becoming a

Final Order, and the occurrence of the Payment Release Date.

7.2. Each of the Parties separately represents and warrants that the execution and

delivery of, and the performance of the obligations contemplated by, this Agreement has been

approved by duly authorized representatives of the Party.

7.3. Each of the Parties separately represents and warrants that the Party has expressly

authorized its undersigned representative to execute this Agreement on the Party's behalf as its

duly authorized agent.

7.4. Each of the Parties separately represents and warrants that this Agreement has

been thoroughly negotiated and analyzed by its counsel and has been executed and delivered in

good faith, pursuant to arm's-length negotiations, and for good and valuable consideration.

8. Entire A~reerrient. This Agreement (and exhibits hereto) constitutes a single

integrated written contract that expresses the entire agreement and understanding between and

among the Parties with respect to matters that are the subject of this Agreement (except to the

extent that this Agreement is also conditioned upon the Class Settlement and court approval of

same). Except as otherwise expressly provided herein (or, as to the Trusts only, as provided in

any prior order of the Bankruptcy Court), this Agreement supersedes all prior communications,

settlements, and understandings between the Parties and their representatives regarding the

matters addressed by this Agreement. Except as explicitly set forth in this Agreement, there are

no representations, warranties, promises, statements, or inducements, whether oral, written,

expressed, or implied, that in any way affect or condition the validity of this Agreement or alter

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or supplement its terms. Any representations, warranties, promises, statements, or inducements,

whether made by any Party or any agents of any Party, that are not contained in this Agreement

shall not be valid or binding. If the facts or law related to the subject matter of this Agreement

are found hereafter to be other than is now believed by any of the Parties, then each of them

expressly accepts and assumes the risk of such possible difference of fact or law and agrees that

this Agreement nonetheless shall be and remain effective according to its terms.

Notwithstanding anything in this Section 8, any and all agreements between or among fewer than

all of the Parties, including the Trustees/Underwriters Agreement, and agreements between

Underwriters and any of the FNF Objecting Parties concerning the Prior Payments, remain in full

force and effect and are not affected by this Section 8.

9. No Admissions by Parties

9.1. This Agreement represents a compromise of disputed Claims and, except as

necessary to enforce any undertakings set forth in this Agreement, this Agreement shall not be

deemed an admission or concession by any Party with respect to any factual or legal contention

or position of any other Party or Person. Nothing contained in this Agreement shall be deemed

an admission by Underwriters that the Trusts, the Trustees, the FNF Objecting Parties oz any

Debtor were or are entitled to any insurance coverage with respect to any Claim or as to the

validity of any of the coverage positions that have been or could have been asserted by the

Trusts, the Trustees, the FNF Objecting Parties or any Debtor, and nothing contained in this

Agreement shall be deemed an admission by the Trusts, the Trustees, the FNF Objecting Parties

or any Debtor as to the validity of any of the rights and defenses of any Party or other Person

under or with respect to the Policies and the Prior Years' Policies and the proceeds thereof, the

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coverage positions or defenses to coverage that have been or could have been asserted by any of

them or by Underwriters or any other insurer.

9.2. The Parties agree that, in the ?vent this Agreement hecnmP~ n>>11 anc~ vc,ici

pursuant to Section 3, no statement made by or on behalf of any Party (including by its counsel)

in connection with the Trustees' efforts, or Underwriters' and the FNF Objecting Parties'

cooperation with their efforts, to obtain entry of the Modified Approval Order, or in connection

with negotiation of this Agreement or the negotiation of the Class Settlement, whether or not any

such statements would otherwise be confidential, shall be used by any Party or Person in any

future proceeding for any purpose, including as a purported admission or concession with respect

to any factual or legal contention or position or as to the validity of any of the coverage

positions, or the validity of any Claim or defense to any Claim, that have been or could have

been asserted by the Trusts, the Trustees, Underwriters, the FNF Objecting Parties, or any

Debtor.

9.3. Settlement negotiations leading up to this Agreement and all related discussions

and negotiations are confidential and shall be deemed to fall within the protection afforded to

compromises and to offers to compromise by Rule 408 of the Federal Rules of Evidence and any

similar state law provisions. Except as necessary in the Trustees' sole discretion with respect to

the Supplemental Motion for Modified Approval Order or any appeal therefrom, or in any

Party's sole discretion to establish in the Bankruptcy Court that such settlement negotiations

were in good faith, arm's-length, and non-collusive, any evidence of the terms of this Agreement

or negotiations or discussions associated with this Agreement shall be inadmissible in any action

or proceeding for purposes of establishing any rights, duties, or obligations of the Parties, except

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in an action or proceeding to enforce the terms of this Agreement, or pursuant to an order of any

court of competent jurisdiction.

A 4 Frnm and after the F,xecuti~n Date, the Trustees, in their sole discretion, may

disclose that they have entered into this Agreement (and the terms thereofj, Underwriters, in their

sole discretion, may disclose that they have entered into this Agreement (and the terms thereo f

to their auditors and reinsurers, solely in their capacities as such, as well as in response to any

inquiry by regulators calling for such disclosures, and the FNF Objecting Parties, in their sole

discretion, may disclose that they have entered into this Agreement (and the terms thereo f to

their auditors, solely in their capacity as such. From and after the filing of the Supplemental

Motion for Modified Approval Order to obtain entry of the Modified Approval Order, the Parties

may disclose to the Bankruptcy Court and publicly that they have entered into this Agreement

(and the terms thereof .

10. Notice. Any and all statements, communications, or notices to be provided

pursuant to this Agreement shall be in writing and sent by electronic mail or overnight delivery

service. Such notices shall be sent to the individuals listed below, or to such other individuals as

the respective party may designate in writing from time to time:

For Underwriters:

Edward T. StorkSedgwick LLP801 Figueroa Street19th FloorLos Angeles, CA 90017Email: [email protected]

with a copy to:

John W. BlancettSedgwick LLP

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125 Broad Street39th FloorNew York, NY 10004-2400Email: [email protected]

For the LES Trust:

Michael S. DevorkinGolenbock Eiseman Assor Bell & Peskoe LLP35t" Floor437 Madison AvenueNew York, NY 10022Email: [email protected]

with a copy to:

Richard ShoreGilbert LLP1100 New York Avenue, NWSuite 700Washington, DC 20005Email: [email protected]

For the LFG Trust:

Bruce H. MatsonLeClair RyanRiverfront Plaza, East Tower951 East Byrd StreetEighth FloorRichmond, VA 23219Email: [email protected]

with a copy to:

Jeffrey S. SabinBingham McCutchen LLP399 Park AvenueNew York, NY 10022-4689Email:[email protected]

For the FNF Objecting Parties:

Mark E. SchiffmanDeputy Chief Legal OfficerFidelity National Financial, Inc.601 Riverside Avenue, 11th Floor

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Jacksonville, FL 32204

with a copy to;

Steven A. GoldfarbHahn Loeser &Parks LLP200 Public SquareSuite 2800Cleveland, Ohio 44115Email: [email protected]

11> Dis~u#e Resolution

11.1. The Parties agree that before resorting to litigation they will attempt to resolve

informally any disputes arising under this Agreement through good faith negotiations for a

period of sixty (60) Days after written notification of such dispute.

11.2. From and after the Payment Release Date, the Parties agree to submit all disputes

relating to the interpretation and enforcement of this Agreement to the jurisdiction of the

Bankruptcy Court. If the Bankruptcy Court refuses to exercise jurisdiction over any such

dispute, the Parties may submit such dispute to any court of competent jurisdiction. All Parties

agree to waive any rights to a jury trial in the resolution of any dispute relating to the

interpretation and enforcement of this Agreement. The foregoing shall not constitute a general

consent, waiver, estoppel, or agreement by Underwriters to otherwise submit themselves to the

jurisdiction of the Bankruptcy Court for any dispute relating to the Policies.

11.3. In the event of any dispute between the Parties, Underwriters agree that service of

process related to such dispute may be made upon the notice parties for Underwriters set forth

herein in paragraph 10. Such parties are authorized and directed to accept service of process on

behalf of Underwriters in any such dispute.

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12. 1V~iseellaneous

12.1. Upon entry of the Modified Approval Order, the FNF Objecting Parties will

provide the LES Trustee with the names of any exchangers with whom they have already settled

("Other Settlements")

12.2. Upon entry of the Modified Approval Order, the FNF Objecting Parties consent to

the LES Trustee issuing a 2004 subpoena to them seeking the production of documents showing

the amounts of each Other Settlement and a copy of the agreement memorializing each Other

Settlement without the necessity of a prior court order to issue the subpoena. The FNF Objecting

Parties will accept service of such a subpoena but reserve all rights to object to such production

on grounds of confidentiality, in which case the Trustee may seek an order to enforce the

subpoena.

12.3. Each Party agrees to take such steps and to execute any documents as may be

reasonably necessary or proper to effectuate the purpose and intent of this Agreement and to

preserve its validity and enforceability. In the event that any action or proceeding of any type

whatsoever is commenced or prosecuted by any Person not a Party hereto to invalidate, interpret,

or prevent the validity, enforcement, or carrying out of all or any of the provisions of this

Agreement, the Parties mutually agree, represent, warrant, and covenant to cooperate fully in

opposing such action or proceeding.

12.4. The Parties agree that they negotiated this Agreement at arm's-length and in good

faith, with each Party receiving advice from independent legal counsel, and that no part of this

Agreement should be construed against a particular Party because of the identity of the drafter.

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12.5. Titles and captions contained in this Agreement are inserted only as a matter of

convenience and are for reference purposes only. Such titles and captions in no way are intended

to define, limit, expand or describe the scope of this Agreement, nor the intent of any provision

thereof.

12.6. This Agreement cannot be amended, altered, or modified except by a written

agreement duly executed by each then-existing Party or its successors or assigns.

12.7. This Agreement may be executed in counterpart originals, all of which, when so

executed and taken together, shall be deemed an original and all of which shall constitute one

and the same instrument. Each counterpart may be delivered by facsimile or email (as a pdf

attachment), and a faxed or emailed signature shall have the same force and effect as an original

signature.

signatures Are On The Following Page

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~I~ WITI~tE~~ WI~EREOF, the Parties have executed this Agreement on the dates) indicated

below.

I,AI~i)1VIElaICA 1031 EXC~IAI~G~ SEIZVIC~S, INC.I,I~UIDA7~~C~li~ ~'RU T ~

,~Y~ ~ ~ '~~

,~Name: Gerard A. McHale, Jr. ~"`' `-

Title: Liquidation Trustee ~'

Date;

Name: Bruce H, MatsonTitle: Liquidation Trustee

Date:

T%1~5~ Cl`!1\~L-911\ lJ1iLE1\VY d\111`11\S tiS LLt~~~9~9

L~1~tDOPt SEVE~.~.,,L,'~' S~T~SCIZI~II~1G 'TO ]POLIO' NOS.

07GFOM2481 AI~tD 07GPOIV124~2

By:

Name:Title:

Date:

1 G; 1 1

.. ~, r r

~i

Name;Title:

Date:

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ITT ~'~I~'l~ E:SS `~~'~1 ~'C~~", tl~e I'artizs have e~~ cured this :~~r~ezncnt on tl~e dat~~~) rnclicated

Bv:

'vTame: Uef~rc~ ~1. I~~1c~-Tale. Jr.~T~itle: l.,iquit~atian Trustee

Date:

~F~ LiQL=ib~°~`IO~ 'I'~UST~3v:

_ __~ ____Lame: F~1 Lice T I ~~tatson~I~i~le: ~t.~iquiclation ~l`rustee

I~at~: a ..~ ~~

TI~C~S~ +C'F..RT:1I~ L ~+I~~iZ~~%l~I'TE.F~:S ~.'~' :IJC~~'I)'S,L~~VDOI SEA' R:=~,I,:.Ia'~' SLJI3SC'K~~3I~d(~ '~'~ Pt?~:1C:~' I~€~~.07txF'()~T2=~~31 .'~1~T~ ()7G1'Oi4'i:2482

~3~':

v~uz~e:"Cit~.le:

Hate:

FII~~?.I..~'~'~' ~.~'I".I~~c1~: FI~~?~~I.~L., ~itiC., t~~ I3:~~.~~~aF' tt~~'I'~"SE]L~ <~.~"07~ Ai.ai.: t~F IT'S S~I3SI~~~_~~ZI~.S :~i'4I~~F'FiL~I,:~T~:S TI~~~T 1~1~~~' 1=Ir~~%I~; C:t~~'~1Z~C~E ~Ttgl~~'SF3~~:

:'~a1ne:"Title:

DatL:

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EXHIBIT 4

EXHIBIT 4

II I 'S~VITi~ESS VVHE~ZEOF, the Parties have executed this Agreement on the dates} indicated

below.

1~ iI:

Name: Gerard A. McHale, lr.Title: Liquidation Trustee

Date:

L~ G LIQUIDATIOiiT TRUSTBy:

Name: Bruce H. MatsonTitle: Liquidation Tn~stee

Date:

TH09E XZ~'ra.~ UIiTDERti~RITERS AT LLOYD'S,LO,,~~3~~N SEVERALL~~SUBSCRIBING TO POLICY NOS.~°~GPONIZ481 AND 07GPC3,~2~~-2__.. ,.

By_.:.. _ ...~..

Name: Joseph M. Smick, `~,e g~~vick .lTitle: Counsel and Authorized Agent

Date: March 2$, 2012

FIDELITY Ii~ATIO~Y~, F~IVA?i'CIAL, I1~C., ON BEfIALF OFITSEIIF -..~1.:vD--~"~ALL OF ITS SUBSIIDIAI2IES A~TDAFFILIATES THAT NIAY HAVE COVERAGE RIGHTSBy:

Name:Title:

Date:

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~~ ~i'~`~"~ 4~ ~~'~~~,~~{~I~, tl~~ P~tr1i~~ l~<~~ ~ cx~~~~~i'~~1 thi, :=4<~:re~;rntnt c.~r~ tl~c; <iatc{~} iz~cl~c~,~~~cl

\a~~,~,:

t3v:

I~itl~: ~.quic~t~iti~~~~~ ~~tlistee.

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[~<ite:

~~:

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Y.,~76,~f6~"1 X1.98".. Yd4 ~..H &B 3.

!~t'.

`~~i~ic: E~xcc:~~tit c l'ic~. I'r~:SidLZ~t ancE Chief i~ i~iar~ci<il C)# siccr

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~(~itle: ~-:~ccuti~-c. t'i~~e ~'z~~siEie~~( and C'l~ii.~l~.'in<1; cis €1 t~)fii~~~~

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N~Err~~:: :1~1tl~i~i~~ J. ParkTitle: l:x~.c~rU~ e ~%ice J'l~e~_ic~~~Zt <ii~ii C`l~t~f~'ii1<i~7~ial (~tti~.ci-

57


EXHIBIT 4

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Exhibit 1Terms of the Modified Approval Order

Jurisdiction, Final Order, and Statutory Predicates

A. The Court has jurisdiction over the motion (the "Approval Motion") to approvethe Settlement Agreement ("Agreement") between the LFG Liquidation Trust and theLandAmerica 1031 Exchange Services Inc., Liquidation Trust (the "Trusts") on the one hand,and Certain Underwriters at Lloyd's, London ("Underwriters"),Z on the other hand, with respectto certain insurance policies subscribed to by Underwriters, and for entry of an order submittedas Exhibit ~3 to the Approval Motion (the `'Original Approval Order''). This Court also hasjurisdiction over the Supplemental Motion for Approval of this Modified Approval Order("Supplemental Motion").The relief requested therein, including responses and objectionsthereto, if any, is pursuant to 28 U.S.C. §§ 157 and 1334, and this matter is a core proceedingpursuant to 28 U.S.C. § 157(b)(2)(A) and (N). Venue of these cases and the Approval Motion inthis district is proper under 28 U.S.C. §§ 1408 and 1409.

B. This Order (also referred to herein as the "Modified Approval Order") constitutesa final and immediately appealable order within the meaning of 28 U.S.C. § 158(a).

9019.C. The predicate for the relief sought in the Approval Motion is Bankruptcy Rule

Retention of Jurisdiction

D. It is necessary and appropriate for the Court to retain jurisdiction to, among otherthings, interpret and enforce the terms and provisions of this Order and the Agreement, and toadjudicate, if necessary, any and all disputes arising under or relating in any way to, or affecting,any of the transactions contemplated under the Agreement. The foregoing sha11 not constitute ageneral consent, waiver, estoppel, or agreement by Underwriters to otherwise submit themselvesto the jurisdiction of the Bankruptcy Court for any dispute relating to the Policies, as definedbelow, set forth in the Agreement or for any other matter. All capitalized terms used herein shallhave the meanings as defined herein, or if not defined herein, the meanings given in theAgreement or the Policies.

' The findings and conclusions set forth herein constitute the Court's findings of fact and conclusions of lawpursuant to Rule 7052 of the Federal Rule of Bankruptcy Procedure, as made applicable to this proceeding pursuantto Rule 9014 of the Federal Rule of Bankruptcy Procedure. To the extent any of the following findings of factconstitute conclusions of law, they are adopted as such. To the extent any of the following constitute findings offact, they are adopted as such.

~ "Underwriters" means all the underwriters, members, or Names at Lloyd's, London, who, through theii-participation in syndicates, severally subscribed to either or both of the Policies, and their present and formerparents, affiliates, shareholders, officers, directors, employees, representatives, attorneys, predecessors, successors,heirs, executors, administrators, and assigns, all solely in their capacities as such.

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Notice of the Approval Motion, the Supplemental Motion, and Modified Approval Order

E. On February 16, 2012, Fidelity National Financial, Inc. ("FNF"), CommonwealthLand Title Insurance Company ("C~LTIC"), Commonwealth Land Title Company(`°Commonwealth"), and Fidelity National Title Insurance Company ("FNTIC"), also f/lvaLandAmerica Charter Title Company ("LCTC"), successor by merger to Lawyer's TitleInsurance Corporation ("LTIC") (collectively the "FNF Objecting Parties") filed an objection(the "Objection") to the Approval Motion. No other Persons timely filed an objection to theApproval Motion.

F. On March 28, 2012, the Trusts, Underwriters, and the FNF Objecting Partiesentered into an agreement to resolve the Objection (the "F~NF Agreement"), pursuant to whichthe FNF Objecting Parties have consented, on the conditions set forth in the FNF Agreement, tothe entry of this Modified Approval Order.

G. The Trusts have provided due and adequate notice of the Approval Motion,including the Original Approval Order, the hearing on the Approval Motion, the Agreement andthe subject matter thereof, the Supplemental Motion including the proposed Modified ApprovalOrder, the FNF Agreement, and the dates of the hearings on the Approval Motion, to all creditorsand parties in interest pursuant to Bankruptcy Rules 2002 and 6004. Such notice was good andsufficient under the particular circumstances, and no further notice is necessary. Withoutlimiting the generality of the foregoing, adequate notice of the Approval Motion, the Hearing,the Agreement, the Supplemental Motion including the proposed Modified Approval Order, theFNF Agreement, and the dates of the hearings on the Approval Motion, has been provided, and areasonable opportunity to object or be heard with respect to the Approval Motion, and theSupplemental Motion, and the relief requested therein has been afforded to all known creditorsof LandAmerica 1031 Exchange Services, Inc. ("LES") or LandAmerica Financial Clroup, Inc.("LFG") (whether such creditors were listed by LES or LFG in their schedules or having filed aproof of claim in the Bankruptcy Cases), all known Insureds listed in the Policies, all directors,employees and officers of the Debtors,3 all Persons and attorneys filing a notice of appearance inthe Bankruptcy Cases, all Persons requested to be served with the Approval Motion byUnderwriters, and such other parties entitled to receive notice pursuant to this Court's December23, 2008, amended administrative order entered in these cases.

The Class Action

H. Certain individuals who are commingled exchangers and also beneficiaries of theLES Trust (the "Hays Litigation Plaintiffs") have filed a purported class action captioned In re:IRS Section 1031 Tax Defe~~ed Exchange Litigation, Vivian R. Mays, et al. v. CommonwealthLand Title Ir~su~ance Company, et al., MDL No. 8:09-mn-2054-JFA, Case No. 3:11-cv-00619-JFA, which was pending in the United States District Court for the District of South Carolina aspart of a Multi District Litigation until March 12, 2012, when an order conditionally remanding

' "Debtors" means LES, LFG, Southland Title of Orange County, Southland Title of San Diego, Southland TitleCorporation, LandAmerica Assessment Corporation, LandAmerica Title Company, LandAmerica Credit Services,Inc., Capital Title Group, Inc., and LandAmerica OneStop, Inc.

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the case back to the transferor court, the United States District Court for the Northern District ofCalifornia, was entered (the ``Hays Litigation"). The Hays Litigation has been remanded back tothe transferor Court.

I. The representatives of the purported class (the "Class") in the Hays Litigationhave entered into an agreement in principle with the FNF Objecting Parties and intend to enterinto a "Class Settlement" consisting of a mutually acceptable written agreement settling the HaysLitigation on terms that will include a release of the FNF Objecting Parties by the HaysLitigation Plaintiffs, individually and on behalf of the Class, the payment of $11 million by theFNF Objecting Parties to the Class, and which will limit any contingency fee for attorneys' feesto counsel for the Class to a percentage of $9 million. The Hays Litigation will be finallyresolved if and when the court with jurisdiction over the Hays Litigation enters an orderapproving the Class Settlement, which provides for a release of the FNF Objecting Parties by theHays Litigation Plaintiffs, individually and on behalf of the Class, payment by the FNFObjecting Parties of $11 million to the Class, limits any contingency fee for attorneys' fees tocounsel for the Class to a percentage of $9 million, (the "Class Action Approval Order") and thatorder becomes a Final Order.4

The Insurance Coverage Claims

J. Underwriters severally subscribed to a primary Insurance Companies BlanketBond and Crime Insurance and Professional Liability Insurance Policy, numbered07GPOM2481, with policy period from December 31, 2007, to December 31, 2008, and anexcess Insurance Companies Blanket Bond and Crime Insurance and Professional LiabilityInsurance Policy, numbered 07GPOM2482, with policy period from December 31, 2007, toDecember 31, 2008, under which LES and LFG are Insureds (the ``Policies"). Policy no.07GPOM2481 is subject to an aggregate limit of liability of $20 million, and Policy no.07GPOM2482 is subject to an aggregate limit of liability of $30 million, for a total of $50million in aggregate limits under the two Policies combined.

K. The Trusts have asserted Claims for coverage under the Policies for or withrespect to all Claims made against LES or LFG by reason of allegations based upon, arising outof, attributable to, resulting from, or related to the acts or omissions of any Insureds with respectto (i) auction rate securities or (ii) the liquidity of LES or LFG from February 2008 throughNovember 26, 2008, which Claims were asserted prior to or during the Debtors' BankruptcyCases by former customers of LES or were raised by Government investigations relating thereto.Such Claims include Claims seeking lost exchange funds, tax liabilities and other damages("LES/LFG Claims," as defined in the Agreement). Damages asserted in connection with theLES/LFG Claims exceed $300 million in the aggregate, including consequential damages. TheLES/LFG Claims involve, but are not limited to, allegations of negligence, breaches of fiduciaryduties, and conversion. The LES Trust and the LFG Trust have collectively distributed morethan $200 million to date to claimants asserting LES/LFG Claims. The Trusts or the Debtors

° "Final Order" means an order as to which the time to appeal, petition for certiorari; or move for rear~ument orrehearing has expired and as to which no appeal, petition for certiorari, request for a stay, or other proceedings for astay, reargument or rehearing shall then be pending, or as to which any such right to appeal, petition for certiorari,stay, reargue, or rehear shall have been waived in writing and withdrawn in accordance with the applicable rules ofthe court.

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also claim to have incurred in excess of $12 million in Defense Costs to date in connection withthe LES/LFG Claims. The Trusts have agreed to accept a settlement payment of $37,855,029.06under the Policies and to deem $41,055,029.06 of the Policies exhausted.

L. Underwriters contend that the aggregate limits of the Policies have been reducedby the following payments to certain of the FNF Objecting Parties or their affiliates (the "PriorPayments''): (1) a payment of $7.75 million in connection with a claim by Mesa Bank againstCapital Title Agency, Inc., now known as Lawyers Title of Arizona, Inc., and (2) a payment of$1,194,970.94 in connection with a claim for a fidelity loss by CLTIC and LTIC involvingFlagler Title Company. Underwriters further contend that the Prior Payments have reduced theremaining aggregate limits of the Policies to a sum that is no greater than $41,055,029.06 in toto

(the "Available Coverage").5 The Trusts and the FNF Objecting Parties dispute Underwriters'contention that the aggregate limits of the Policies have been reduced below $50 million so as tolimit the amount of Professional Liability i,oss (including Defense Costs} recoverable by theTrusts and by CLTIC, LTIC, and certain of their affiliates to the Available Coverage orotherwise.

M. The FNF Objecting Parties contend, inter alia, that that Underwriters areobligated under the Policies to pay losses incurred and to be incurred by certain of the FNFObjecting Parties in connection with claims for coverage by CLTIC, LTIC, and certain of theiraffiliates, including coverage for the claims asserted by the Class in the Hays Litigation, and thatthey are entitled to a portion of the $37,855,029.06 that is to be awarded to the Trusts under theAgreement. The FNF Objecting Parties also contended that the Agreement improperly relievesthe Underwriters of approximately $3.2 million in coverage obligations to which the FNFObjecting Parties have a claim. The Underwriters and the LES Trustee dispute the contentions ofthe FNF Objecting Parties. The LES Trustee also contends, inter alia, that if the ApprovalMotion is not granted, the Trusts would be entitled to recover from the FNF Objecting Partiessome or all of the Prior Payments. The FNF Objecting Parties and Underwriters dispute this.

N. Underwriters dispute the existence and extent of their obligations to the Trustsand to the FNF Objecting Parties under the Policies.

O. The Trusts and the FNF Objecting Parties dispute their respective entitlement tothe Available Coverage and to other potentially available coverage under the Policies but, solelyas a matter of compromise for purposes of this Agreement (provided that the Modified ApprovalOrder becomes a Final Order and otherwise subject to a full reservation of rights, withoutwaiving anything, and subject to the Agreement and the FNF Agreement), the Trusts and theFNF Objecting Parties have agreed that the Policies' remaining aggregate limits potentiallyavailable to pay Professional Liability Loss (including Defense Costs) total $41,055,029.06(being the Available Coverage).

5 "Available Coverage" means $41,055,029.06 in coverage under the Policies, which represents $50 million in totalaggregate limits under the Policies less the Prior Payments.

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Sound Business Judgment and Reasonableness

P. Although the Trusts contend that the Professional Liability I.~oss incurred inconnection with the LES/LFG Claims far exceed and fully exhaust the Available Coverage, theTrusts have agreed to accept a settlement payment of $37,855,029.06 (the "LES SettlementPayment") and release Underwriters, on the conditions that this Modified Approval Orderbecomes a Final Order and that the Class Action Approval Order becomes a Final Order, inorder to save the expense and avoid the burden, delay, and risk of further negotiations orlitigation with Underwriters and the FNF Objecting Parties concerning the Trusts' entitlement tocoverage under the Policies for the LES/LFG Claims, which I~ES Settlement Payment willprovide the Trusts with substantial financial and other benefits in addition to the amount of thepayment itself.

Q. Although the FNF Objecting Parties would otherwise object to the LESSettlement Payment, they have consented to the entry of this Modified Approval Order and thepayment of the LES Settlement Amount on the condition that Underwriters pay them $3,200,000under the Policies (the "FNF Settlement Payment"), there is an exchange of mutual releasesamong the FNF Objecting Parties, the Trusts, and Underwriters under the terms of the FNFAgreement, and that this Modified Approval Order becomes a Final Order and the Class ActionApproval Order becomes a Final Order, in order to save the expense and avoid the burden, delay,and risk of further negotiations or litigation with Underwriters and the Trusts concerning theparties' respective entitlement to coverage under the Policies.

R. Under the terms of the FNF Agreement, Underwriters are required to pay the FNFSettlement Payment to the FNF Objecting Parties. Collectively, the LES Settlement Paymentand the FNF Settlement Payment are equal to the Available Coverage, which further supportsthat the Available Coverage is exhausted by actual payment.

S. In order to obtain the consent of the FNF Objecting Parties and Underwriters tothe Modified Approval Order, the FNF Agreement provides for the exchange of mutual releasesamong the FNF Objecting Parties, Underwriters, and the Trusts, on the conditions that (i) thisModified Approval Order becomes a Final Order, (ii) the Class Action Approval Order becomesa Final Order (and the Class Settlement includes a provision that the FNF Objecting Parties paythe Class $11 million and limits any contingency fee for attorneys' fees to counsel for the Classto a percentage of $9 million); (iii) the Underwriters pay the FNF Settlement Amount to the FNFObjecting Parties, in addition to the LES Settlement Payment made to the LES Trustee; and (iv)the Payment Release Date proposed in the Approval Motion, which provided that the OriginalApproval Order (and releases) would be effective on the seventh day after the Original ApprovalOrder became a Final Order, is modified to mean the following:

the seventh day after the earliest date when all of the following conditions haveoccurred: (a) this Modified Approval Order has become a Final Order; (b) theClass Action Approval Order has become a Final Order; and (c) no member of theClass has opted out with finality from the Class Settlement or counsel for the FNFObjecting Parties has certified that the FNF Objecting Parties accept the numberof opt outs in accordance with their rights under the terms of the Class Settlement

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(notwithstanding the foregoing, the FNF Objecting Parties may waive thiscondition (c) at their option).

In the event that the Class Action Approval Order does not become a Final Order or the FNFAgreement otherwise becomes null and void as provided therein, then this Modified ApprovalOrder will be vacated, the Approval Motion will be restored to the calendar with the Objectionpending, and the parties will jointly propose a schedule for any remaining briefing and a hearingdate on the Approval Motion.

T. The FNF Agreement does not materially change the terms of the Agreement, andthe Modified Approval Order does not differ materially from the Original Approval Order. Theamount of money that Underwriters will pay to the Trusts does not change. Certain commingledexchangers, who are beneficiaries of the LES Trust, will share in an additional $11 million,which Fidelity is paying to the Class. The FNF Agreement requires the 'rusts and the FNFObjecting Parties to exchange mutual releases.

U. The relief requested in the Approval Motion, as amended by this ModifiedApproval Order, including the mutual releases between the Trusts and the FNF ObjectingParties, is fair, reasonable and in the best interests of the Trusts and the Trusts' beneficiaries.The resolution of the FNF Objections and the Modified Approval Order will also result in anadditional $11 million being paid, through the Class Settlement, to certain beneficiaries of theLES Trust. The Trustees have demonstrated good, sufficient and sound business purposes andjustifications for the relief requested in the Approval Motion, as amended by the SupplementalMotion, and this Modified Approval Order, and the approval of the transactions contemplatedthereby. The settlement and compromise with Underwriters embodied in the Agreement isconsistent with the reasonable range of litigation outcomes if the Trusts were to litigate thematters resolved pursuant to this Modified Approval Order. Settling on the terms set forth in theAgreement and the Modified Approval Order permits the Trusts to save the expense and avoidthe burden, delay, and risk of further negotiations or litigation with Underwriters and the FNFObjecting Parties concerning the Trusts' entitlement to coverage under the Policies for theLES/LFG Claims, which provides the Trusts with substantial financial and other benefits inaddition to the amount of the settlement payment. The Agreement was negotiated in good faithand the consideration and payments to be made thereunder are found to be made for reasonablyequivalent value and for fair consideration by and among the Trusts, Underwriters, and the FNFObjecting Parties.

V. The Trustees have demonstrated that the probability of success for the Trusteesand the Trusts in litigation over the matters resolved by the Agreement, including litigation overclaims for coverage under the Policies, is uncertain; that the litigation of the matters resolved bythe Agreement and this Modified Approval Order would be complex and costly to the Trusts;that the entry into the Agreement is consistent with the reasonable range of potential litigationoutcomes; and that entry into the Agreement, as modified by this Modified Approval Order, is inthe best interests of the Trusts and their beneficiaries.

For all of the foregoing and after due deliberation, IT IS ORDERED, ADJUDClED, ANDDECREED THAT:

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The Approval Motion, as amended by the Supplemental Motion and this ModifiedApproval Order, is GRANTED and APPROVED.

1. The failure to specifically include any particular provision of the Agreement orthe FNF Agreement in this Modified Approval Order sha11 not diminish or impair theeffectiveness of such provision, it being the intent of the Court that the Agreement be authorizedand approved in its entirety.

2. The Trustees, on behalf of the Trusts and their respective beneficiaries, areauthorized and directed (i) to enter into the Agreement and to agree to this Modified ApprovalOrder, (ii) to undertake all acts as are necessary to consummate the transactions contemplated bythe Agreement in accordance with its terms, (iii) to execute and deliver all documents as may berequired to effectuate the transactions contemplated by the Agreement, subject only to theconditions specified herein and in the Agreement, and (iv) to exchange mutual releases betweenthe Trusts and the FNF Objecting Parties pursuant to the FNF Agreement.

3. For the reasons set forth herein and on the record at the hearing, all objections tothe Approval Motion and the Supplemental Motion, and the relief requested therein or granted inthis Modified Approval Order that have not been withdrawn, waived, or settled, and allreservations of rights included in such objections, are overruled on the merits.

4. (a) Pursuant to Bankruptcy Rule 9019, the settlement and mutual releases ofclaims as set forth in the Agreement, and the mutual releases between the Trusts and the FNFObjecting Parties pursuant to the FNF Agreement, are hereby approved, and this Order shall beeffective as of the seventh day after all of the following conditions have occurred: (i) thisModified Approval Order has become a Final Order; (ii) the Class Action Approval Order hasbecome a Final Order; and (iii) no member of the Class has opted out with finality from the ClassSettlement or counsel for the FNF Objecting Parties has certified that the FNF Objecting Partiesaccept the number of opt outs in accordance with their rights under the terms of the ClassSettlement (notwithstanding the foregoing, the FNF Objecting Parties may waive this condition(iii) at their option).

(b) This Modified Approval Order shall be vacated and be null and void (i) upon the datethat an order of the court with jurisdiction over the Hays Litigation declines or refuses to enterthe Class fiction Approval Order or that Order does not become a Final Order; (ii) in the solediscretion of the LES Trustee if either (x) a motion for preliminary approval of the ClassSettlement has not been filed on or before May 15, 2012, or (y) the court with jurisdiction overthe Hays Litigation has not scheduled a hearing for final approval of the Class Settlement on orbefore September 30, 2012; or (iii) by any party, in its sole discretion, if one year has passedfrom the filing of the motion for preliminary approval of the Class Settlement, and the ClassSettlement Approval Order has not been entered or does not become a Final Order. The partiesshall notify the Court if this Order becomes null and void pursuant to this paragraph 4(b).

(c) In the event this Modified Approval Order is vacated pursuant to paragraph 4(b), theApproval Motion will be restored to the calendar with the Objection pending with all other rightspreserved pursuant to the FNF Agreement, and the parties will agree to a schedule for anyremaining briefing and a hearing date on the Approval Motion.

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5. Upon this Modified Approval Order becoming effective pursuant to paragraph4(a) above, the Available Coverage shall be deemed fully, finally, actually, and properlyexhausted and Underwriters shall have no further obligations under the Policies to any Insuredsfor or with respect to the Available Coverage, whether for Loss, defense, indemnity, bid faith,improper or unfair claims handling, or otherwise.

6. This Order shall be final and binding on all Persons that received adequate noticeof the Approval Motion, and, upon the Payment Release Date, Underwriters' payment of theLES Settlement Amount shall be final and binding on all Persons that received adequate noticeof the Approval Motion.

7. This Court shall retain jurisdiction to interpret and enforce the provisions of thisOrder and the Agreement in all respects, and to adjudicate, if necessary, any and all disputesarising under or relating in any way to, or affecting, any of the transactions contemplated underthe Agreement, or related to this Order. The foregoing shall not constitute a general consent,waiver, estoppel, or agreement by Underwriters to otherwise submit themselves to thejurisdiction of the Bankruptcy Court for any dispute relating to the Policies set forth in theAgreement or for any other matter.

It is so ORDERED.

UNITED STATES BANKRUPTCY JUDGE

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Exhibit 2Sl) Trust Release

This Release is executed as of this day of March, 2012, by Southland Title of

(range (:ounty Liquidation l rust, Southland l itle of San lliego Liquidation l rust, Southland

Title Corporation Liquidation Trust, LandAmerica Assessment Corporation Liquidation Trust.

LandAmerica Title Company Liquidation Trust, LandAmerica Credit Services, Inc. Liquidation

Trust, Capital Title Group, Inc. Liquidation Trust, and LandAmerica OneStop, Inc. Liquidation

Trust (collectively, the "SD Trusts")

WHEREAS LandAmerica 1031 Exchange Services, Inc. Liquidation Trust (the "LES

Trust") and the LFG Liquidation Trust (the "LFG Trust") (collectively the "Trusts") entered into

a certain settlement agreement (the "Agreement'') with Certain Underwriters at Lloyd's, London

(as further defined in the Agreement, "Underwriters"),6 dated on or about Januaryl0, 2012.

WHEREAS on January 16, 2012, the LES Trustee filed in the Bankruptcy Court for the

Eastern District of Virginia motion (the "Approval Motion") to approve the Agreement and enter

an order to that effect (the "Order")

WHEREAS on-February 16, 2012, Fidelity National Financial, Inc. ("FNF"),

Commonwealth Land Title Insurance Company ("CLTIC"), Commonwealth Land Title

Company ("Commonwealth"), Fidelity National Title Insurance Company ("FNTIC"), also f/k/a

LandAmerica Charter Title Company ("LCTC"), and successor by merger to Lawyer's Title

Insurance Corporation ("LTIC") (collectively the "FNF Objecting Parties") filed an objection

(the "Objection") to the Approval Motion.

~' "Underwriters" means all the underwriters, members, or Names at Lloyd's, London, who, through theirparticipation in syndicates, severally subscribed to either or both of the Policies, and their present and formerparents, affiliates, shareholders, officers, directors, employees, representatives, attorneys, predecessors, successors,heirs, executors, administrators, and assigns, all solely in their capacities as such.

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WHEREAS on or about March 28, 2012, the Trusts, Underwriters, and the FNF

Objecting Parties entered into an agreement to resolve the Objection (the "FNF Agreement"),

pursuant to which the FNF Objecting Parties have consented, on the conditions set forth in the

FNF Agreement, to the entry of an modified order instead of the Order (the "Modified Approval

Order") in the form attached thereto as Exhibit 1, granting the Approval Motion and approving

the Agreement.

WHEREAS, upon the Plan Effective Date, as set forth in the Plan, certain assets of

Southland Title of Orange County, Southland Title of San Diego, Southland Title Corporation,

LandAmerica Assessment Corporation, LandAmerica Title Company, LandAmerica Credit

Services, Inc., Capital Title Group, Inc., and LandAmerica OneStop, Inc. (collectively, the "SD

Debtors") were transferred to the SD Trusts, including the SD Debtors' Claims under the

Policies.

WHEREAS the SD Trusts enter into this Release in accordance with section 6.10 of the

FNF Agreement.

WHEREAS all terms not defined herein shall have the meaning given to such term in the

Agreement, the FNF Agreement, or the Policies, as applicable.

NOW THEREFORE, for other good and valuable consideration, the receipt and

sufficiency of which are hereby acknowledged:

12elease.

1,1. Except for the obligations expressly reserved under the FNF Agreement

by the parties thereto, effective upon the Payment Release Date as defined in the FNF

Agreement, the trustees of the SD Trusts, (solely in their capacity as such, collectively, the "SD

Trustees"), on behalf of themselves and each of the SD Trusts (including all beneficiaries of the

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SD Trusts, solely in their capacities as such, and, respectively, the SD Debtors) shall fully,

finally, and completely release and waive any and all Claims and Interests of the SD Debtors, SD

Trustees, and the SD Trusts, as against the FNF Objecting Parties and their parents, subsidiaries,

and affiliates, but solely in their capacities as such, and all of their directors, officers, employees,

agents, and aCtarneys, but solely in their capacities as such, (a) for or with respect to insurance

coverage, rights, or obligations under or with respect to the Policies or the Prior Years' Policies

(including, for the avoidance of doubt, the proceeds thereof , and (b) for or with respect to the

LES/LFG Claims or the CLTIC/LTIC Claims, including any and all such Claims or Interests,

whether direct or derivative, that the Trusts are legally entitled to release, whether for or with

respect to damages, loss, defense, indemnity, contribution, attorneys' fees, costs, and expenses

incurred by the Trustees, and the Trusts, or interest of any sort.

vacated.

1.2. This Release shall be null and void if the Modified Approval Order is

1.3. Notwithstanding anything in this Release to the contrary, nothing in this

Release releases any directors, officers, employees, agents or attorneys of any FNF Objecting

Party for any liability for any act or omission prior to December 17, 2008 but solely in such

capacity for a party other than an FNF Objecting Party, which other parties includes LES and

LFG. Notwithstanding anything to the contrary set forth in this Release, nothing herein shall: (i)

supersede, amend, or modify, or be deemed or construed to supersede, amend or modify, in any

respect the Settlement and Mutual Release Agreement dated September 9, 2009 between, among

others, FNF and LFG; as approved by order of the Bankruptcy Court dated September 14, 2009,

both of which shall remain in full force and effect; or (ii) release any claims currently asserted in

the Matson v. Alper°t, et al. case, adversary Proceeding Number 1 1-03168 (KRH), pending in

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Case No. 08-3599 (KRH) before the Bankruptcy Court for the Eastei°n District of Virginia.

Nothing in this Release shall affect the application of any injunction, bar, or other defense

provided under the Plan or the orders confirming the Plan.

2. Consideration. In consideration of the foregoing, the FNF Objecting Parties will

pay to each of the SD Trusts $1.00 and other good and valuable consideration, the receipt of

which is hereby acknowledged.

1Zepresentataons and Warranties

3.1. Each of the SD Trustees hereby represents and warrants that (i) each has

requisite power and authority to execute and deliver this Release; (ii) any and all consents and

approvals required for each SD Trust to enter into this Release have been obtained; (iii) to the

extent the SD Trusts have any Claims and Interests against the FNF Objecting Parties and their

parents, subsidiaries, and affiliates, the SD Trusts have not assigned, transferred, encumbered, or

hypothecated such Claims and Interest, and (iv) that this Release is subject to the entry of the

Modified Approval Order.

3.2. Each individual executing this Release on behalf of a SD Trust warrants

and represents that he/she has the authority to execute this instrument on behalf of such trust.

4. l~to iVIodification Except by Writing, This Release may not be amended,

modified or altered, nor may any of its provisions be waived, except by a writing executed by

duly-authorized officers or representatives of the SD Trusts and Underwriters.

Captions and Headings. All paragraph headings used herein are for convenience

only and are not part of this Release and shall not be used in construing same.

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WHEREFORE, the parties have affixed their signatures as of the date first written above.

SOUTHLAND TITLE OF ORANGECOUNTY LIQUIDATION TRUST

C

BRUCE H. MATSON, SOLELY IN HISCAPACITY AS LIQUIDATIONTRUSTEE FOR THE SOUTHLANDTITLE OF ORANGE COUNTYLIQUIDATION TRUST

SOUTHLAND TITLE CORPORATIONLIQUIDATION TRUST

C

BRUCE H. MATSON, SOLELY IN HISCAPACITY AS LIQUIDATIONTRUSTEE FOR THE SOUTHLANDTITLE CORPORATION LIQUIDATIONTRUST

LANDAMERICA TITLE COMPANYLIQUIDATION TRUST

IC

BRUCE H. MATSON, SOLELY IN HISCAPACITY AS LIQUIDATIONTRUSTEE FOR THE LANDAMERICATITLE COMPANY LIQUIDATIONTRUST

1398926.1

SOUTHLAND TITLE OF SAN DIEGOLIQUIDATION TRUST

C

BRUCE H. MATSON, SOLELY IN HISCAPACITY AS LIQUIDATION TRUSTEEFOR THE SOUTHLAND TITLE OF SANDIEGO LIQUIDATION TRUST

LANDAMERICA ASSESSMENTCORPORATION LIQUIDATION TRUST

BRUCE H. MATSON, SOLELY IN HISCAPACITY AS LIQUIDATION TRUSTEEFOR THE LANDAMERICA ASSESSMENTCORPORATION LIQUIDATION TRUST

LANDAMERICA CREDIT SERVICES, INC.LIQUIDATION TRUST

BRUCE H. MATSON, SOLELY IN HISCAPACITY AS LIQUIDATION TRUSTEEFOR THE LANDAMERICA CREDITSERVICES, 1NC. LIQUIDATION TRUST

5


EXHIBIT 4

EXHIBIT 4

CAPITAL TITLE GROUP, INCLIQUIDATION TRUST

C

13KU(:~: H. MA15UN, SULLY 1N H15CAPACITY AS LIQUIDATIONTRUSTEE FOR T~-~IE CAPITAL TITLEGROUP, INC. LIQUIDATION TRUST

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LANDAMERICA ONESTOP, INC.LIQUIDATION TRUST

t3KUC:~ H. MA"1~5UN, SUL~;LY 1N H1~CAPACITY AS LIQUIDATION TRUSTEEFOR THE LANDAMERICA ONESTOP, INC.LIQUIDATION TRUST

D


EXHIBIT 4

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IN THE UNITED STATES BANKRUPTCY COURTFOR THE EASTERN DISTRICT OF VIRGINIA

RICHMOND DIVISION

------------------------------------------------------xIn re : Chapter 11

:LandAmerica Financial Group, Inc., et. al., : Case No. 08-35994 (KRH)

:Debtors. : (Jointly Administered)

------------------------------------------------------x

ORDER AUTHORIZING AND APPROVING SETTLEMENT AGREEMENT BY AND AMONG THE LANDAMERICA 1031 EXCHANGE SERVICES, INC. LIQUIDATION

TRUST, THE LFG LIQUIDATION TRUST, AND CERTAIN UNDERWRITERS AT LLOYD’S, LONDON, AND RELATED RELIEF

FINDINGS OF FACT AND CONCLUSIONS OF LAW:1

Jurisdiction, Final Order, and Statutory Predicates

A. The Court has jurisdiction over the motion (the “Approval Motion”) to approve the Settlement Agreement (“Agreement”) between the LFG Liquidation Trust and the LandAmerica 1031 Exchange Services Inc., Liquidation Trust (the “Trusts”) on the one hand, and Certain Underwriters at Lloyd’s, London (“Underwriters”),2 on the other hand, with respect to certain insurance policies subscribed to by Underwriters, and for entry of an order submitted as Exhibit B to the Approval Motion (the “Original Approval Order”). This Court also has jurisdiction over the Supplemental Motion for Approval of this Modified Approval Order (“Supplemental Motion”).The relief requested therein, including responses and objections thereto, if any, is pursuant to 28 U.S.C. §§ 157 and 1334, and this matter is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A) and (N). Venue of these cases and the Approval Motion in this district is proper under 28 U.S.C. §§ 1408 and 1409.

B. This Order (also referred to herein as the “Modified Approval Order”) constitutes a final and immediately appealable order within the meaning of 28 U.S.C. § 158(a).

C. The predicate for the relief sought in the Approval Motion is Bankruptcy Rule 9019.

1 The findings and conclusions set forth herein constitute the Court’s findings of fact and conclusions of law pursuant to Rule 7052 of the Federal Rule of Bankruptcy Procedure, as made applicable to this proceeding pursuant to Rule 9014 of the Federal Rule of Bankruptcy Procedure. To the extent any of the following findings of fact constitute conclusions of law, they are adopted as such. To the extent any of the following constitute findings of fact, they are adopted as such.

2 “Underwriters” means all the underwriters, members, or Names at Lloyd’s, London, who, through their participation in syndicates, severally subscribed to either or both of the Policies, and their present and former parents, affiliates, shareholders, officers, directors, employees, representatives, attorneys, predecessors, successors, heirs, executors, administrators, and assigns, all solely in their capacities as such.

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Retention of Jurisdiction

D. It is necessary and appropriate for the Court to retain jurisdiction to, among other things, interpret and enforce the terms and provisions of this Order and the Agreement, and to adjudicate, if necessary, any and all disputes arising under or relating in any way to, or affecting, any of the transactions contemplated under the Agreement. The foregoing shall not constitute a general consent, waiver, estoppel, or agreement by Underwriters to otherwise submit themselves to the jurisdiction of the Bankruptcy Court for any dispute relating to the Policies, as defined below, set forth in the Agreement or for any other matter. All capitalized terms used herein shall have the meanings as defined herein, or if not defined herein, the meanings given in the Agreement or the Policies.

Notice of the Approval Motion, the Supplemental Motion, and Modified Approval Order

E. On February 16, 2012, Fidelity National Financial, Inc. (“FNF”), Commonwealth Land Title Insurance Company (“CLTIC”), Commonwealth Land Title Company (“Commonwealth”), and Fidelity National Title Insurance Company (“FNTIC”), also f/k/a LandAmerica Charter Title Company (“LCTC”), successor by merger to Lawyer’s Title Insurance Corporation (“LTIC”) (collectively the “FNF Objecting Parties”) filed an objection (the “Objection”) to the Approval Motion. No other Persons timely filed an objection to the Approval Motion.

F. On March 28, 2012, the Trusts, Underwriters, and the FNF Objecting Parties entered into an agreement to resolve the Objection (the “FNF Agreement”), pursuant to which the FNF Objecting Parties have consented, on the conditions set forth in the FNF Agreement, to the entry of this Modified Approval Order.

G. The Trusts have provided due and adequate notice of the Approval Motion, including the Original Approval Order, the hearing on the Approval Motion, the Agreement and the subject matter thereof, the Supplemental Motion including the proposed Modified Approval Order, the FNF Agreement, and the dates of the hearings on the Approval Motion, to all creditors and parties in interest pursuant to Bankruptcy Rules 2002 and 6004. Such notice was good and sufficient under the particular circumstances, and no further notice is necessary. Without limiting the generality of the foregoing, adequate notice of the Approval Motion, the Hearing, the Agreement, the Supplemental Motion including the proposed Modified Approval Order, the FNF Agreement, and the dates of the hearings on the Approval Motion, has been provided, and a reasonable opportunity to object or be heard with respect to the Approval Motion, and the Supplemental Motion, and the relief requested therein has been afforded to all known creditors of LandAmerica 1031 Exchange Services, Inc. (“LES”) or LandAmerica Financial Group, Inc. (“LFG”) (whether such creditors were listed by LES or LFG in their schedules or having filed a proof of claim in the Bankruptcy Cases), all known Insureds listed in the Policies, all directors, employees and officers of the Debtors,3 all Persons and attorneys filing a notice of appearance in the Bankruptcy Cases, all Persons requested to be served with the Approval Motion by Underwriters, and such other parties entitled to receive notice pursuant to this Court’s December 23, 2008, amended administrative order entered in these cases.

3 “Debtors” means LES, LFG, Southland Title of Orange County, Southland Title of San Diego, Southland Title Corporation, LandAmerica Assessment Corporation, LandAmerica Title Company, LandAmerica Credit Services, Inc., Capital Title Group, Inc., and LandAmerica OneStop, Inc.

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The Class Action

H. Certain individuals who are commingled exchangers and also beneficiaries of the LES Trust (the “Hays Litigation Plaintiffs”) have filed a purported class action captioned In re: IRS Section 1031 Tax Deferred Exchange Litigation, Vivian R. Hays, et al. v. Commonwealth Land Title Insurance Company, et al., MDL No. 8:09-mn-2054-JFA, Case No. 3:11-cv-00619-JFA, which was pending in the United States District Court for the District of South Carolina as part of a Multi District Litigation until March 12, 2012, when an order conditionally remanding the case back to the transferor court, the United States District Court for the Northern District of California, was entered (the “Hays Litigation”). The Hays Litigation has been remanded back to the transferor Court.

I. The representatives of the purported class (the “Class”) in the Hays Litigation have entered into an agreement in principle with the FNF Objecting Parties and intend to enter into a “Class Settlement” consisting of a mutually acceptable written agreement settling the Hays Litigation on terms that will include a release of the FNF Objecting Parties by the Hays Litigation Plaintiffs, individually and on behalf of the Class, the payment of $11 million by the FNF Objecting Parties to the Class, and which will limit any contingency fee for attorneys’ fees to counsel for the Class to a percentage of $9 million. The Hays Litigation will be finally resolved if and when the court with jurisdiction over the Hays Litigation enters an order approving the Class Settlement, which provides for a release of the FNF Objecting Parties by the Hays Litigation Plaintiffs, individually and on behalf of the Class, payment by the FNF Objecting Parties of $11 million to the Class, limits any contingency fee for attorneys’ fees to counsel for the Class to a percentage of $9 million, (the “Class Action Approval Order”) and that order becomes a Final Order.4

The Insurance Coverage Claims

J. Underwriters severally subscribed to a primary Insurance Companies Blanket Bond and Crime Insurance and Professional Liability Insurance Policy, numbered 07GPOM2481, with policy period from December 31, 2007, to December 31, 2008, and an excess Insurance Companies Blanket Bond and Crime Insurance and Professional Liability Insurance Policy, numbered 07GPOM2482, with policy period from December 31, 2007, to December 31, 2008, under which LES and LFG are Insureds (the “Policies”). Policy no. 07GPOM2481 is subject to an aggregate limit of liability of $20 million, and Policy no. 07GPOM2482 is subject to an aggregate limit of liability of $30 million, for a total of $50 million in aggregate limits under the two Policies combined.

K. The Trusts have asserted Claims for coverage under the Policies for or with respect to all Claims made against LES or LFG by reason of allegations based upon, arising out of, attributable to, resulting from, or related to the acts or omissions of any Insureds with respect to (i) auction rate securities or (ii) the liquidity of LES or LFG from February 2008 through November 26, 2008, which Claims were asserted prior to or during the Debtors’ Bankruptcy Cases by former customers of LES or were raised by Government investigations relating thereto. Such Claims include Claims seeking lost exchange funds, tax liabilities and other damages (“LES/LFG Claims,” as defined in the

4 “Final Order” means an order as to which the time to appeal, petition for certiorari, or move for reargument or rehearing has expired and as to which no appeal, petition for certiorari, request for a stay, or other proceedings for a stay, reargument or rehearing shall then be pending, or as to which any such right to appeal, petition for certiorari, stay, reargue, or rehear shall have been waived in writing and withdrawn in accordance with the applicable rules of the court.

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Agreement). Damages asserted in connection with the LES/LFG Claims exceed $300 million in the aggregate, including consequential damages. The LES/LFG Claims involve, but are not limited to, allegations of negligence, breaches of fiduciary duties, and conversion. The LES Trust and the LFG Trust have collectively distributed more than $200 million to date to claimants asserting LES/LFG Claims. The Trusts or the Debtors also claim to have incurred in excess of $12 million in Defense Costs to date in connection with the LES/LFG Claims. The Trusts have agreed to accept a settlement payment of $37,855,029.06 under the Policies and to deem $41,055,029.06 of the Policies exhausted.

L. Underwriters contend that the aggregate limits of the Policies have been reduced by the following payments to certain of the FNF Objecting Parties or their affiliates (the “Prior Payments”): (1) a payment of $7.75 million in connection with a claim by Mesa Bank against Capital Title Agency, Inc., now known as Lawyers Title of Arizona, Inc., and (2) a payment of $1,194,970.94 in connection with a claim for a fidelity loss by CLTIC and LTIC involving Flagler Title Company. Underwriters further contend that the Prior Payments have reduced the remaining aggregate limits of the Policies to a sum that is no greater than $41,055,029.06 in toto (the “Available Coverage”).5 The Trusts and the FNF Objecting Parties dispute Underwriters’ contention that the aggregate limits of the Policies have been reduced below $50 million so as to limit the amount of Professional Liability Loss (including Defense Costs) recoverable by the Trusts and by CLTIC, LTIC, and certain of their affiliates to the Available Coverage or otherwise.

M. The FNF Objecting Parties contend, inter alia, that that Underwriters are obligated under the Policies to pay losses incurred and to be incurred by certain of the FNF Objecting Parties in connection with claims for coverage by CLTIC, LTIC, and certain of their affiliates, including coverage for the claims asserted by the Class in the Hays Litigation, and that they are entitled to a portion of the $37,855,029.06 that is to be awarded to the Trusts under the Agreement. The FNF Objecting Parties also contended that the Agreement improperly relieves the Underwriters of approximately $3.2 million in coverage obligations to which the FNF Objecting Parties have a claim. The Underwriters and the LES Trustee dispute the contentions of the FNF Objecting Parties. The LES Trustee also contends, inter alia, that if the Approval Motion is not granted, the Trusts would be entitled to recover from the FNF Objecting Parties some or all of the Prior Payments. The FNF Objecting Parties and Underwriters dispute this.

N. Underwriters dispute the existence and extent of their obligations to the Trusts and to the FNF Objecting Parties under the Policies.

O. The Trusts and the FNF Objecting Parties dispute their respective entitlement to the Available Coverage and to other potentially available coverage under the Policies but, solely as a matter of compromise for purposes of this Agreement (provided that the Modified Approval Order becomes a Final Order and otherwise subject to a full reservation of rights, without waiving anything, and subject to the Agreement and the FNF Agreement), the Trusts and the FNF Objecting Parties have agreed that the Policies’ remaining aggregate limits potentially available to pay Professional Liability Loss (including Defense Costs) total $41,055,029.06 (being the Available Coverage).

5 “Available Coverage” means $41,055,029.06 in coverage under the Policies, which represents $50 million in total aggregate limits under the Policies less the Prior Payments.

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Sound Business Judgment and Reasonableness

P. Although the Trusts contend that the Professional Liability Loss incurred in connection with the LES/LFG Claims far exceed and fully exhaust the Available Coverage, the Trusts have agreed to accept a settlement payment of $37,855,029.06 (the “LES Settlement Payment”) and release Underwriters, on the conditions that this Modified Approval Order becomes a Final Order and that the Class Action Approval Order becomes a Final Order, in order to save the expense and avoid the burden, delay, and risk of further negotiations or litigation with Underwriters and the FNF Objecting Parties concerning the Trusts’ entitlement to coverage under the Policies for the LES/LFG Claims, which LES Settlement Payment will provide the Trusts with substantial financial and other benefits in addition to the amount of the payment itself.

Q. Although the FNF Objecting Parties would otherwise object to the LES Settlement Payment, they have consented to the entry of this Modified Approval Order and the payment of the LES Settlement Amount on the condition that Underwriters pay them $3,200,000 under the Policies (the “FNF Settlement Payment”), there is an exchange of mutual releases among the FNF Objecting Parties, the Trusts, and Underwriters under the terms of the FNF Agreement, and that this Modified Approval Order becomes a Final Order and the Class Action Approval Order becomes a Final Order, in order to save the expense and avoid the burden, delay, and risk of further negotiations or litigation with Underwriters and the Trusts concerning the parties’ respective entitlement to coverage under the Policies.

R. Under the terms of the FNF Agreement, Underwriters are required to pay the FNF Settlement Payment to the FNF Objecting Parties. Collectively, the LES Settlement Payment and the FNF Settlement Payment are equal to the Available Coverage, which further supports that the Available Coverage is exhausted by actual payment.

S. In order to obtain the consent of the FNF Objecting Parties and Underwriters to the Modified Approval Order, the FNF Agreement provides for the exchange of mutual releases among the FNF Objecting Parties, Underwriters, and the Trusts, on the conditions that (i) this Modified Approval Order becomes a Final Order, (ii) the Class Action Approval Order becomes a Final Order (and the Class Settlement includes a provision that the FNF Objecting Parties pay the Class $11 million and limits any contingency fee for attorneys’ fees to counsel for the Class to a percentage of $9 million); (iii) the Underwriters pay the FNF Settlement Amount to the FNF Objecting Parties, in addition to the LES Settlement Payment made to the LES Trustee; and (iv) the Payment Release Date proposed in the Approval Motion, which provided that the Original Approval Order (and releases) would be effective on the seventh day after the Original Approval Order became a Final Order, is modified to mean the following:

the seventh day after the earliest date when all of the following conditions have occurred: (a) this Modified Approval Order has become a Final Order; (b) the Class Action Approval Order has become a Final Order; and (c) no member of the Class has opted out with finality from the Class Settlement or counsel for the FNF Objecting Parties has certified that the FNF Objecting Parties accept the number of opt outs in accordance with their rights under the terms of the Class Settlement (notwithstanding the foregoing, the FNF Objecting Parties may waive this condition (c) at their option).

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In the event that the Class Action Approval Order does not become a Final Order or the FNF Agreement otherwise becomes null and void as provided therein, then this Modified Approval Order will be vacated, the Approval Motion will be restored to the calendar with the Objection pending, and the parties will jointly propose a schedule for any remaining briefing and a hearing date on the Approval Motion.

T. The FNF Agreement does not materially change the terms of the Agreement, and the Modified Approval Order does not differ materially from the Original Approval Order. The amount of money that Underwriters will pay to the Trusts does not change. Certain commingled exchangers, who are beneficiaries of the LES Trust, will share in an additional $11 million, which Fidelity is paying to the Class. The FNF Agreement requires the Trusts and the FNF Objecting Parties to exchange mutual releases.

U. The relief requested in the Approval Motion, as amended by this Modified Approval Order, including the mutual releases between the Trusts and the FNF Objecting Parties, is fair, reasonable and in the best interests of the Trusts and the Trusts’ beneficiaries. The resolution of the FNF Objections and the Modified Approval Order will also result in an additional $11 million being paid, through the Class Settlement, to certain beneficiaries of the LES Trust. The Trustees have demonstrated good, sufficient and sound business purposes and justifications for the relief requested in the Approval Motion, as amended by the Supplemental Motion, and this Modified Approval Order, and the approval of the transactions contemplated thereby. The settlement and compromise with Underwriters embodied in the Agreement is consistent with the reasonable range of litigation outcomes if the Trusts were to litigate the matters resolved pursuant to this Modified Approval Order. Settling on the terms set forth in the Agreement and the Modified Approval Order permits the Trusts to save the expense and avoid the burden, delay, and risk of further negotiations or litigation with Underwriters and the FNF Objecting Parties concerning the Trusts’ entitlement to coverage under the Policies for the LES/LFG Claims, which provides the Trusts with substantial financial and other benefits in addition to the amount of the settlement payment. The Agreement was negotiated in good faith and the consideration and payments to be made thereunder are found to be made for reasonably equivalent value and for fair consideration by and among the Trusts, Underwriters, and the FNF Objecting Parties.

V. The Trustees have demonstrated that the probability of success for the Trustees and the Trusts in litigation over the matters resolved by the Agreement, including litigation over claims for coverage under the Policies, is uncertain; that the litigation of the matters resolved by the Agreement and this Modified Approval Order would be complex and costly to the Trusts; that the entry into the Agreement is consistent with the reasonable range of potential litigation outcomes; and that entry into the Agreement, as modified by this Modified Approval Order, is in the best interests of the Trusts and their beneficiaries.

For all of the foregoing and after due deliberation, IT IS ORDERED, ADJUDGED, AND DECREED THAT:

The Approval Motion, as amended by the Supplemental Motion and this Modified Approval Order, is GRANTED and APPROVED.

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1. The failure to specifically include any particular provision of the Agreement or the FNF Agreement in this Modified Approval Order shall not diminish or impair the effectiveness of such provision, it being the intent of the Court that the Agreement be authorized and approved in its entirety.

2. The Trustees, on behalf of the Trusts and their respective beneficiaries, are authorized and directed (i) to enter into the Agreement and to agree to this Modified Approval Order, (ii) to undertake all acts as are necessary to consummate the transactions contemplated by the Agreement in accordance with its terms, (iii) to execute and deliver all documents as may be required to effectuate the transactions contemplated by the Agreement, subject only to the conditions specified herein and in the Agreement, and (iv) to exchange mutual releases between the Trusts and the FNF Objecting Parties pursuant to the FNF Agreement.

3. For the reasons set forth herein and on the record at the hearing, all objections to the Approval Motion and the Supplemental Motion, and the relief requested therein or granted in this Modified Approval Order that have not been withdrawn, waived, or settled, and all reservations of rights included in such objections, are overruled on the merits.

4. (a) Pursuant to Bankruptcy Rule 9019, the settlement and mutual releases of claims as set forth in the Agreement, and the mutual releases between the Trusts and the FNF Objecting Parties pursuant to the FNF Agreement, are hereby approved, and this Order shall be effective as of the seventh day after all of the following conditions have occurred: (i) this Modified Approval Order has become a Final Order; (ii) the Class Action Approval Order has become a Final Order; and (iii) no member of the Class has opted out with finality from the Class Settlement or counsel for the FNF Objecting Parties has certified that the FNF Objecting Parties accept the number of opt outs in accordance with their rights under the terms of the Class Settlement (notwithstanding the foregoing, the FNF Objecting Parties may waive this condition (iii) at their option).

(b) This Modified Approval Order shall be vacated and be null and void (i) upon the date that an order of the court with jurisdiction over the Hays Litigation declines or refuses to enter the Class Action Approval Order or that Order does not become a Final Order; (ii) in the sole discretion of the LES Trustee if either (x) a motion for preliminary approval of the Class Settlement has not been filed on or before May 15, 2012, or (y) the court with jurisdiction over the Hays Litigation has not scheduled a hearing for final approval of the Class Settlement on or before September 30, 2012; or (iii) by any party, in its sole discretion, if one year has passed from the filing of the motion for preliminary approval of the Class Settlement, and the Class Settlement Approval Order has not been entered or does not become a Final Order. The parties shall notify the Court if this Order becomes null and void pursuant to this paragraph 4(b).

(c) In the event this Modified Approval Order is vacated pursuant to paragraph 4(b), the Approval Motion will be restored to the calendar with the Objection pending with all other rights preserved pursuant to the FNF Agreement, and the parties will agree to a schedule for any remaining briefing and a hearing date on the Approval Motion.

5. Upon this Modified Approval Order becoming effective pursuant to paragraph 4(a) above, the Available Coverage shall be deemed fully, finally, actually, and properly exhausted and Underwriters shall have no further obligations under the Policies to any Insureds for or with respect

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Case No. C 10-05336 JSW 1 Robert L. Brace, Esq., SBN ...

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