31794550 Summary Secure Diversified Investments and Lending Part 1

SUMMARY SECURE

DIVERSIFIED INVESTMENTS

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SUMMARY

SECURE DIVERSIFIED

INVESTMENTS

I. SECURE LENDING LLC

1. The following individuals participated in a scheme conducted by Securities Attorney Kyleen

Cane (“Cane”), Venture Capitalist and corporate Chairman / CEO Wallace (“Wallace”), with assistance

by Grace Sim (“Sim”), accountant /CFO, Mujit Johal, SDI CFO, Jay Kister (“Kister”), Director of

Secure Diversified Investments (“SDI”), and Manager of ILENDSERVICES, Secure Diversified

Lending (“SDL”), and other individuals related to SDI. The scheme involves identity theft, undisclosed

affiliate relationships, undisclosed beneficiary ownership, securities fraud, accounting fraud, and

unregistered securities sales.

2. Companies. The public company at the center of the scheme is SDI, which Wallace and Cane

have fiduciary duties to, and consolidated Secure Diversified Lending, a mortgage lending business,

ILENDSERVICES a related mortgage lending business, and IOMEGA Investments LLC, owned by the

West Family holding a promissory note against SDI, which is the target of interest. Wallace and Cane

secure leverage with Biddle (“Wldbillw”), and Helen West, manager of IOMEGA Investments, through

her incapacitated state, execute a proxy for Wallace, and sell the IOMEGA interest to SDI in May 2004.

3. Overview of the Scheme. Cane and Wallace employ various fraudulent schemes and legal

devices to gain control of a corporation, involving classically the issuance of near or simple majority of

securities, bankrupting the entity and then reverse merge the shell to sell unregistered securities into the

market. The scheme employs causing individuals or entities to appear to do actions, within business

judgment secretly controlled by Cane. Control of a corporation strikes at the officers, then directors,

and then convertible debentures. The timely conversion, back dating, or miscalculated issuance of

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shares, in conjunction with reverse split, conceals shares, asserts majority, and completes the corporate

take-over. Cane deceitfully represents to the corporation bone fide agency or attorney services, in

concert with one or more nefarious consultants and officers to disable those that would thwart the

scheme. Cane’s disabling of individuals through direct legal actions, derivative action, whistle blower

reports, or other good faith and code of ethics abuses devices both affords the accomplice immunity and

confidentiality. The use of promissory notes, convertible notes, underlying securities appear benign,

however have very flexible and potent uses both in the securing of the corporate entity during operation,

through bankruptcy and upon reorganization, but also in the manner it is converted.

4. On May 5, 2006, Cane, Securities Attorney, Wallace, CEO of the parent company and Grace

Sim, accountant, created Secure Diversified Lending (SDL) with the purpose to provide mortgage loans

to Secure Diversified Investments (SDI). The SDL membership included Patrick McNevin, SDI

Director, Amin Lahka, silent capital contributor, Grace Sims, and Wallace.

5. On May 5, 2006 Cane to Bryan Clark, Ms. Cane’s legal partners and Wallace stated the Secure

Diversified Lending Plan. May 11, 2006, Cane’s firm Cane Clark’s attorney Brian Clark provided

documents for a convertible promissory note, secured promissory note, and security agreement for the

Secure Lending LLC scheme. On June 1, 2006, Cane Clark on behalf of Ms. Wallace filed an initial list

of managers for Secure Lending LLC, citing Wallace as the only operating manager.

6. June 14, 2006 unnamed Jay Kister and Wallace, Director of SDI and Manager of SDL and

parent Secure Diversified Investments caused a $250,000 loan from 3rd party lending facility to pass

through Infinity Lending Service, where an audit is overseen by Kister, then transferred into Secure

Lending Account held at Wells Fargo, oversee another audit, then to Secure Diversified Investments,

until the removal of the funds, and back to the lending source. SDI CEO Wallace responded to the

scheme “let’s talk about the process”.

7. September 15, 2006, Ms. Wallace causing Jennie Denoia to make statements to William Biddle

regarding a loan he was seeking from Secure Diversified Lending, to contain false statements including

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appraisal, term of the loan and uncertainty of this approval. This was done intentionally by Wallace

through two mortgage lending entities Secure Lending and ILENDSERVICES to destabilize Mr. Biddle

for some purpose.

II. SECURE DIVERISIFED INVESTMENTS

8. On July 5, 2005, Ms. Wallace stated to Ms. Clifford Strand, that she would form a Secure

Diversified Audit Committee formation with Mr. Mujit Johal, Ms. Cane, among a dozen other

objectives, and she stated that she would oversee the REIT Stock restatement, involving Ms. Claire

Ambrosio, Ms. Wallace’s personal attorney. This was in response to financial anomalies occurring with

Bank of the West and other breaches attorney client confidentiality at SDI.

9. On July 8, 2005, Mr. Clifford Strand stated to Ms. Kelly Black, and Wallace share and note

structure of SDI, class A, B, C, and the amounts they held. The same day, mysterious transactions at

Bank of the West were occurring, causing further instability in management, and management

arguments with 3rd parties escalating using terms such as fraud. On July 11, 2005, Ms. Wallace in

concert with Yablon caused an outline of demands on Secure Diversified Investments appearing to favor

Ms. Wallace over Mr. Strand.

10. On July 15, 2005, the secret formation of Western Investment Partners by Grace Sim,

incorporating on behalf of Ms. Cane, including members or directors Ms. Wallace, Mr. Jay Kister, Mr.

Amin Lahka and Mr. Patrick McNevin. August 22, 2005, Mr. Clifford Strand stated to SDI

management that the WIP president and one/two other principals were visiting SDI, while Ms. Cane and

Ms. Wallace plan to attend as well; Mr. Clifford Strand was unaware of Ms. Cane and Ms. Wallace’s

involvement. On information and belief Mr. Amin Lahka, Mr. Pierre Ergas and others attended

purporting business, and causing the appearance of credibility to Ms. Wallace and Ms. Cane.

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11. September 2, 2005, SDI 8K announced Ms. Wallace’s SDI Presidential Appointment.

September 28, 2005 SDI 8K announced Mr. Clifford Strand and Mr. William Biddle’s resignation.

October 5, 2005 SDI 8K announced, Ms. Wallace as a SDI Director.

12. Purportedly, December 14, 2005 Ms. Cane, Ms. Wallace, with Ms. Helen West executed the

Settlement and Confidential Agreement between SDI and Iomega Investments LLC which caused the

assignment of control of Iomega to SDI, including The PARTIES agree that upon execution by

IOMEGA this AGREEMENT, SDI shall pay to IOMEGA the gross amount of forty thousand dollars

($40,000.00) as payment in full on the Unsecured Installment Note dated May 12, 2004; The PARTIES

further agree that IOMEGA will be entitled to immediately exercise its conversion rights for its

preferred shares at the current market price for SDI’s Common Stock at the time of notice to the transfer

agent; SDI makes no representations or warranties regarding the tax effect of the settlement proceeds as

directed by this AGREEMENT. Further, IOMEGA agrees to defend and/or indemnify SDI with respect

to any liability created by IOMEGA'S payment or non-payment of taxes with respect to the settlement

sum.

13. Purportedly, December 14, 2005, Ms. Cane and Ms. Wallace caused the SDI Corporate Director

Written Consent to Convert Iomega Shares, stating: RESOLVED, that the Directors hereby authorize

management of the Corporation to direct the Corporation’s stock transfer agent to convert Iomega’s

250,000 Series C Preferred Stock, valued at $3.00 per share, into 15,000,000 shares of the Corporation’s

Common Stock, trading at $0.05 per share; December 14, 2005, First Amendment of the By Laws of

SDI, change of Corporate Offices, Certain Related Party Transactions; draft SDI 8K, statement of

Iomega Conversion and statements about registration rights.

14. Purportedly on December 14, 2005 Settlement Confidentiality Agreement Between SDI and

Iomega where as SDI pays $40,000 to Iomega, “allowing for Iomega to exercise its conversion, that

Iomega makes no representations or warranties regarding tax effect of the settlement proceeds, Iomega

agrees to defend and indemnify SDI with respect to any Iomega’s payment or nonpayment.” On

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December 14, 2005 with written consent by directors of Secure Diversified Investments caused the

conversion of 15,000,000 shares to be issued, which Ms. Wallace executed, on behalf of SDI and further

executed the proxy statement, giving Ms. Wallace control of the LLC; the execution of agreements

occurred as planned and documented by Ms. Cane.

15. February 2, 2006, Schedule 13D was filed for Iomega Investments LLC to issue 15,000,000

shares of SDI; On information and belief Ms. Cane agent Ms. Wallace, through Mr. Biddle, caused the

West Family, specifically Helen West to consent to the transfer of the IOMEGA Investments LLC, for

$40,000 and stock, its acquisition was secret throughout the conversion until bankruptcy, it was learned

that Wallace received proxy voting control for the Iomega Investments despite individuals stating

otherwise.

III. IOMEGA INVESTMENTS

16. Through communications on primarily conducted on February 28, 2006, Ms. Cane instructed

Ms. Wallace and Scott Doney to execute a prescribed scheme including back-date certain transactions,

with documentation, including generation of meeting minutes causing the necessary business judgment

authority to allow early conversion of 15,000,000 shares, secretly under Ms. Cane and Ms. Wallace

control. February 28, 2006, Cane’s Plan for Secure Diversified Investments documented in email

communication states: “Bylaws amendment – in the minutes of the 1-21-06 meeting we need to make

sure that the amendment to the bylaws is reflected as we discussed to allow the meeting of shareholders

to occur within 90 days of the filing of the 10K. The board felt that this was a more appropriate time to

hold the meeting,so that the shareholders could receive the annual report. In addition, when you are

preparing the annual report (10K), I want to make sure that it contains a detailed disclosure of all

conflict violations of prior management in the section on CERTAIN RELATIONSHIPS AND RELATED

TRANSACTIONS. Jan will arrange for signatures. Prepare a proxy for signature. This should not be

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dated; Prepare an 8k for amendment of the bylaws – 5.03(a) and shares issued 3.02, 5.01; Prepare a

14A for filing after the 10K with the new board slate – for election of the board.”

17. Ms. Cane follows up with additional information on March 1, 2006 including “the Form 8-K,

which includes the 15,000,000 common stock conversion, Peter Richman’s appointment, and changes to

Bylaws; the First Amended Bylaws, which will be filed as an Exhibit 3.1 to the Form 8-K; the

confidential settlement and general release agreement dated Dec. 14; the board consent authorizing

entry into the settlement agreement dated Dec. 14; the board consent authorizing conversion at $0.05

per share (the then trading amount); the Jan 21 board minutes re changes to bylaws; and Proxy (you

will need to fill in the date of annual meeting) (for Iomega).”

18. March 2, 2006, “Wldbillw” or Mr. Biddle established email communication with Wallace citing

concern for the retention of email communication.

19. March 8, 2006, Mr. Biddle stated that Helen had suffered a number of strokes, and that he was

taking care of her however, it appears that Ms. Wallace and Mr. Biddle were intimate and disclosure of

communication with other directors and board members was discussed. March 15, 2006, Ms. Wallace,

invited “Wldbillw”, and Helen west to dinner, where she invited two directors from SDI.

20. Ms. Wallace received email from “Wldbillw” regarding finding of funds on his behalf on March

9th , from Mr. Biddle requiring that he contact before the 15th, requesting to contact him.

21. On June 6, 2006, Helen West, manager of Iomega Investments, signed the SDI SC13D Iomega

conversion disclosure form, the date of the event stated to require this filing, was February 2, 2006.

22. Secure Diversified Investments made public disclosures to the SEC through their 10KSB on

July 2006, stating financial relationship with SDL and Infinity Lending Services containing knowingly

false information. Public disclosure regarding SDI president Wallace, holding proxy voting control

over Iomega Investments, disclosure of beneficiary ownership, control or potential conflict another

party such as Secure Diversified Lending was not disclosed through any registration statements.

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23. On July 5, 2006, Ms. Wallace stated to Mr. Clifford Strand she would establish that an audit

committee will be formed comprising of Cane, Wallace and Johal. On information and belief to affirm

financial mismanagement and oust the previous management. July 17, 2006, Ms. Wallace transferred

funds to Helen West, through “WldBillw”, same day, the following people were communicated to Ms.

Wallace, Helen, William, Jami, James West and Cognata, the list was transferred to Jim Brondino, five

(5) people total. August 22, 2006, Ms. Wallace affirmed the roll-back occurred. July 20 2006, Mr.

Mujit Johal provided Helen and Heather, transfer agent letters, requiring medallion signatures.

24. Cane, Cane Clark and Wallace on May 5, 2006 filed a SEC solicitation Complaint against

Clifford Strand and Gerold Trolf, which was reciprocated by Strand and Trolf filing their own.

(“attached”)

25. June 30, 2005, Wallace presented to the board of SDI, as Wallace Black LLC an audit report

containing broad stroke complaints regarding various accounting irregularities of which were caused by

her or her agents. Wallace fraudulently represented Johal, unknown to her, when in fact they were

colluding on fracturing the management of SDI, as independent party concealing their plan to take over

the company. Wallace maintained a secret relationship with Jim Brondino to monitor SDI CEO Clifford

Strand and William Biddle.

26. June 28, 2006, Wallace provided “Wldbillw” deposits for information, and communicated

information shared to him in confidence by Biddle and Clifford Strand CEO, and Operating Officer of

SDI. These individuals and family was the original financial contributor of Iomega Investments, which

Wallace secretly purchased and had a voting proxy for.

27. July 28, 2006, Wallace secretly paid William Biddle for exchange for information. Including

communication with Mr. Clifford Strand.

28. August 2006 Cane Clark in efforts to settle with Clifford Strand ensured Wallace, individually

was protected by ensuring she was a settling party.

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29. September 13, 2006, Ms. Wallace secretly through Secure Lending and ILENDSERVICES

stated to Mr. William Biddle facts relating to a purported loan Ms. Wallace was approving for him. Ms.

Wallace stated she also needed to talk with Mr. Biddle regarding stock transaction, relating to the

Iomega LLC and West Family.

30. Secure Diversified Investments entered bankruptcy in 2007, prior to this event, Wallace and the

other executive staff increase salaries as to incur additional accrued notes against the corporation.

Wallace also caused related party transactions whereby she exchanged or caused the issuance of assets

to her sole benefit in exchange for reducing promissory note value. These transactions were not valued

independently.

31. During involuntary bankruptcy, Cane positioned herself away from corporate securities role and

stepped into the debtor in possession where Cane demands payment for fees and accepts the corporation

itself as payment. Wallace as CEO of SDI converted lower round C class shares preferred while

ignoring conversion rights of prior classes. Wallace unilaterally converted C class shares and ignored

class A and B holders. The following statement was extracted from the SEC complaint made on the

matter.

32. Cane and Wallace orchestrated the roll-back of shares in SDI. Kelly Black, of Wallace Black,

managed the process of setting Secure Diversified Investments to be listed on the Frankfurt Exchange.

33. Prior to entering bankruptcy, Wallace on behalf of Secure Diversified Investments (SDI)

invested 1/3 of equity into Cactus Scottsdale property of $300,000, caused a loan to be taken against the

property secured by SDI, upon entering bankruptcy, transferred the property to herself personally.

Wallace received 400,000 derivative shares of SDI on March 4, 2005. Johal on October 11, 2005

received 250,000 derivative shares of SDI, earlier he received 500,000 shares, for their participation in

the bankruptcy of SDI.

34. SCDI SEC filings which contain conflicting information include February 2, 2006, Schedule

13D was filed containing statements regarding Iomega LLC issued 15,000,000 shares of Secure

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Diversified Investments. Documented in the June 30, 2006 10QSB, “On February 2, 2006, Iomega

converted its 250,000 shares of Series C Preferred Stock for 15,000,000 shares of the Company’s

common stock.”

35. Documented in the September 30, 2006, 10QSB November 14, 2006, “the Company had the

following equity transaction adjusted for the effect of reverse split of 20:1. On December 22, 2005, the

Chief Executive Officer and President returned 2,250 shares of common stock to the Company for

cancellation and return to unissued and authorized shares. The shares were cancelled January 14, 2006.

On February 2, 2006, Iomega converted its 12,500 shares of Series C Preferred Stock for 750,000 shares

of the Company’s common stock.”

36. Documented in the December 31, 2006, 10KSB, the following statement was made, “All the

issued and outstanding shares have been retroactively restated for the effect of the reverse stock split of

20:1. During the year ended December 31, 2006 and 2005, the Company had the following equity

transaction: On February 2, 2006, Iomega converted its 250,000 shares of Series C Preferred Stock for

15,000,000 shares of the Company’s common stock. The shares were converted at a price of $0.05 per

share.”

DATED this 4th day of March, 2010.

Signature Name,

Secured lending money6 messages

Jay Kister <[email protected]> Tue, Jun 6, 2006 at 10:43 AM

Reply-To: [email protected]: Jan Wallace <[email protected]>

Jan,There are items I need set up, for example an 800 fax number, and a tollfree number. I think I pay now a total of $50 a month or something forthese services, I also will set up an account to buy supplies with officedepot, and set up a fed-ex account. Should I just dedicate one of mycreditcards to Secured and be reimbursed or do we want to set up a company card.Of course, once we have a bank account I can set up auto debits from theaccount.

I did receive an email from Grace, apparently she does not have a computerexcept for a home computer. She is requesting a lap top so that she canwork at the office and from home. The way I have my system set up she canwork from any computer along as it has online access. Would it be moreefficient that the company buy one computer at the office for her to use,ora lap top, or require her to have her own, to do the job. You know Gracemore than I do so I will refer this to you. But please let me knowquicklybecause I do need her working with me.

So let me know how you want to handle the cost right now. I will getthingsgoing.

Thank you,Jay Kister

jan wallace <[email protected]> Mon, Jun 12, 2006 at 12:35 AM

To: [email protected], Airplanes Rus <[email protected]>

Jay What is the 1-800 number for? We have already arranged all the lines thisis a little lateGrace is getting a computer and she is not coming on board in sepember shewill be there from the beginning, the financial must be inplace, sdi isputting in all the costs and management to get the project launched,itwill be incumbent on the companyto have a control person in place. Theproforma is being effected again because of rising costs which are allcoming from one source,sdi.Employees are coming into the office on Thursday, I need to know when youare coming exactly, as I am slated to go east for a weddingThe incorporation is done and the ein 20-5009563, is established the bankaccount will be set-up between grace, myself and Munjit

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The phone number is operationalI need the server shipped to arrive here by Wednesday so we can set-upHeard about the licensing mishap in Arizona, you dropped the ball but youpicked up and saved it, we'll chalk that up to growing pains.

The contract is to be finished, the inequitable participation isproblematic for sdi, it is incurring all the financial burden therefore,if m henry puts in the banking funds he will receive his 33% stake, yourposition will open with 15% with an earn in of up to 33% sdi will vest atopening equity of20% up to 33%. If the henry group fulfills greater thanthe annual numbers of 06 revenues kister/sdi will contribute equalportions to the henry group to bring them to 40% of the shares of thecompany.Please comment and get back to me,jan

[Quoted text hidden]

jan wallace <[email protected]> Mon, Jun 12, 2006 at 2:21 PM

To: [email protected]


Jay Kister <[email protected]> Tue, Jun 13, 2006 at 7:30 AM

Reply-To: [email protected]: jan wallace <[email protected]>

Jan,I will be there on Monday through Wednesday. My visit there I will besureeveryone knows how to use the lenders we are approved with currently andwehave a simple flow system. I will be meeting with clients and prospectiveclients. I don't know specifically if there is a whole lot of stuff weneedto do but get some banking stuff and operating agreement stuff signed.

Thanks for letting me know the EIN#. Is there anyway I could have thearticles of the company faxed to 866-572-4737. the faster the better.

GRACE--I was under the assumption Grace was going to be working from thebeginning so we are on the same page. She will be working for as manyhoursa week is needed and that is expected to go up as we get busier. That'showher employment was explained to me.

Operating agreement---You will need to explain to me or send me thedocumentexplaining the set-up and exactly how it will work, I am not seeing why itwas necessary to make a change at the very end. As far as what I amputtingin at this point we are going to use the structure for doing loans I havealready created which is about 16K. I am not asking to be reimbursed formoney I have spent but I don't like constantly feeling like you and Markare

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the only ones putting something into this and I will put more cash if Ineedto. I am going to make this company set up correctly. I will do mydandiest to conform to a budget, but it is secondary to a machine thatwillrun correctly. My hope was with the way we had it set up is that we wouldnot have to bicker about what was put in by who and how much. Thiscompanywill be as successful as it can be as long as the partners aren't walkingoneggshells and paranoid of each other. I hope this new structureaccomplishes that.

Computer--The server is set up. It is in California and will stay there.Ijust need to know what the kind of computers you are getting. Having themnetworked is very simple because it will be through the internet. But Idoneed to get certain software on them and get the printers hooked up. So Ineed to know when they will be there and what kind they will be.

Bank Account--With the operating account I don't mind never writing acheck,but I do have to show that I am on the account, for licensing purposes Itake full responsibility for handling of all funds. To have fullresponsibility my name will have to be on the account. Also, when is theanticipated 250K coming because to be honest I need audited started upfinancials that show that 250K in the bank if it is going to be more thanbyThursday I need to go out and get 250K myself. I simply can't wait anylonger. If it is going to be longer that is fine just let me know anactualdate when it will be here or estimate if that is what you have.

I think I wrote to much for one email, this is going to fun Jan so smile,let make money!Jay


jan wallace <[email protected]> Tue, Jun 13, 2006 at 8:33 AM


Jay thanks for the reply, but there are communication problems-I did not know that the server is staying there, I have to co-ordinate tonew plans,also I have to find out if mark and dick have any problems withthat-if you have costs we must know and have a record of it just like sdi iskeeping a record, as we are audited-the newest issue is that dick got messed up with his mortgage, youapparently do not have the right licence to be a mortage bank in Arizona,you are supposed to have a separate license other than real estate, theseare matters I do not know about, so I need to know if you are properlylicensed,if not when. This issue is a hot button for mark, dick is workingtoday to save the same mortgage with another vendor because putting itthrough infinity did not work. Mark and dick is concerned withcredibility, one loan, three companies, not good for the type of developer

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loans we want to do, or any loan as a matter of fact. This problem isdirectly affecting mark putting in the 250'000 in the bankCommunication is key we have to straighten these issues now.The reason the agreement has changed is because the moneys of sdi aregoing out with no contract in place, hardly prudent therefore theappearance is one of inequity if you were to show contribution that isauditable, it would diminish the imbalance. If everyone does there jobs wewillend up in the same place anyhow. Get back to me on this asap as I amhaving a meeting today with dick and mark to clarify mattersstill smilingjan

-----Original Message-----From: Jay Kister [mailto:[email protected]]


Jay Kister <[email protected]> Tue, Jun 13, 2006 at 12:01 PM

Reply-To: [email protected]: jan wallace <[email protected]>

Jan,This is what has happened and this is what I am doing.

In Arizona there are two licenses that I have been told you can do loansunder the Real Estate and the Mortgage Banking. As Infinity Lending, theLenders I am currently approved with have told me I can do loans in AZunderthe name of Infinity Lending. Because of the scenario that happenedyesterday I have sent an email to every lender I am approved with todoublecheck this is a fact. The Lender we were dealing with yesterday wasstrictin their requirement to have the Mortgage Banking license. This is thefirst time I have encountered this and yes I agree it is not good at all.

So I am going to also get the Mortgage Banking License. I will do this sothat there will never be an issue with any lender. There is no class ortest that you take in order to receive this license, it is just paperwork.We do have the qualifications to get this license today if I have thebelow.This is what I will need in short and the time frame we are looking at.1. Personal History application and finger print cards from allprinciples/owners/management.2. Audited Financial (this is just for the opening of the company, it istoshow the 250K in cash assets. I have a CPA, but if you have one fasterandcheaper that would be great.)3. Bond4. a few other minor itemsTiming--This process can take 90-120 days reason is the background checkthey do on the principles. If the principles are just Myself and DickThiscould be very fast I am sure. The question is can I get an auditfinancial

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this week showing 250K in the bank, if not I need to make otherarrangementsto see what I can do to make it happen.

Until this happens and we have the Mortgage banking license we can doloansunder Infinity Lending Services, Inc. and this will not affect pricing orsplits in any way.

as far as the operating agreement that seems fine, and I will keep trackofall expense so that it can be audited.

:) I love this high paced world you live in, keeps you young right.

Thank you,Jay Kister

-----Original Message-----From: jan wallace [mailto:[email protected]]Sent: Tuesday, June 13, 2006 9:33 AMTo: [email protected]


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EIN Application

Mersino, Jeanette <[email protected]> Thu, Jun 8, 2006 at 12:37 PM

To: jan wallace <[email protected]>

Jan

Please see attached-fill out and return asap.

Do you have the EIN for secured Diversified?

Secured Lending business will be __________? (Mortgages?)

First date wages will be paid?

Number of employees expected?

Jeanette Mersino

Paralegal

Cane Clark LLP

3273 E. Warm Springs

Las Vegas, NV 89120

702·312·6255

702·944·7100 FAX

[email protected]

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Call Jan with any questions. Thanks, Ky

Kyleen Elisabeth Cane

Cane Clark, LLP

3273 E. Warm Springs

Las Vegas, NV 89120

(702) 312-6255 (Office)

(702) 944-7100 (Fax)

www.CaneClark.com

SDOC3784.pdf

190K

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Dear Bill, 9/14/06

Since I cannot get hold of you, I want you to know that we are doing everything we

can to clear up this situation on your loan. For many reasons, you and Helen are

important to this company & we will endeavor to do right by you and continue to pursue the

lender to get this done. Even if you decide to go somewhere else, I do want you to know that

a full investigation of the facts were done in house and we feel you should at least have the

facts relayed to you as a response to what you felt went wrong.

1. Time issue seems to be of concern in this statement. Here is the time line per the processors

notes in the file. The application was received by the processor on the 31st of August. It was

processed into Point that day. After conversations with the lender on how to structure the

loan, the loan was submitted on September 5th after a three day weekend. The approval was

received two days later on the 7th. So from receipt of the 1003 to the approval it was only 4

business days. In regards to the quote “count Mondays & every other Wednesdays”;

mortgage loans are subjected to regulatory laws. In the case of refinance loans, the law states

the borrower is given 3 full business days to change their mind. This is referred to as “The

right of recession” Sometimes depending on when you sign; it may take up to 5 or 6 calendar

days to fund.

2. In regards to the Good Faith Estimate, GFE, that is exactly what it is. An estimate. Loan

terms change periodically through out a loan. This can change for many reasons. In your case

it was different because 1.) The disclosures were sent prior to receiving approval, (which by

law we are required to disclose within a certain time period) these disclosures included the

GFE. 2.) The rate was not incorrect. In actuality, the rate was LOWER than what was

quoted on the GFE. Documents were signed at the rate of 11.25.

3. In regards to the concern of a better rate and payment with a different company. The loan

was done on an interest only calculation. This is done by taking the loan amount multiplied by

the rate and divided by 12 to give the monthly interest only payment. It is not mathematically

possible to get a 3,000 payment on an Interest Only loan using the rate of 11.44 with the loan

amount of 464,750. That Interest Only payment would be 4,430.62. If the other lender’s

payment is in fact 900 cheaper, all things being equal, then it would be prudent to take that

1/2

other loan.

4. In regards to the concern of an appraisal review being pulled. The approval was sent with an

appraisal review condition. This was a prior to doc condition. The processor knew and was

aware of your urgent request for the docs to be signed. The processor discussed that if we

got the docs, there would be a possibility that the loan would not fund in time because of the

possible appraisal issues and if anything on the appraised value changed, docs may have to

be re-drawn. As previously stated, the appraisal was the underlying condition. The lender did

us a favor by moving that condition prior to funding. Docs were sent out. The lender went

over the appraisal review and ordered a field review. This was ordered the 12th by the

lender. Appraisal reviews are a common practice by all lenders. Hard money loans (Low fico

scores & credit issues) rely on appraisal reviews more than conventional lenders to protect

their investment. We are working diligently with the lender to have them reconsider the

determined value. The loan was scheduled to fund on the 14th of September. At the most,

this will delay the funding until Tuesday, but only if we get the appraisal issue turned around.

What may come of it is that the cash out may be less, but you would not have to payoff

collection accounts. In time, with 12 months of loan payments made in a timely manner, we

will be able to refinance the loan with a much better rate & additional cash out.

Bill, you know I have always tried to do best by you& Helen, and will still continue to do so.

However, I understand your frustration, but no one was trying to lie or disrespect you, and it

is not fair to wrongfully characterize anyone as you did in your letter.

I am sad to hear about APS and as always I will put out an offer to help.

Please take it in the spirit in which it is offered. Please give my best to Helen.

Love,

Jan Wallace

2/2

RE: YOUR LOAN1 message

Susan Tate <[email protected]> Fri, Sep 15, 2006 at 10:33 AM

Reply-To: [email protected]


Bill and Helen

It is Sue with Secured Lending. I wanted to let you know you do have a loan. They did cut the appraisal on the

value due to different issues that the field appraiser

addressed which is not unheard of on a hard money loan. We have all worked hard on your loan since we

received it and more so with the issues that have come about. I am working on getting the documents to

your mom in California. As soon as I know I will relay the information to you.

Please respond to this e-mail ASAP. I need written verification from you that you want to go forward with

the new loan. Once we hear back from you I can go over the new loan in detail with you. Including cash out

& terms and we can hit the green light for getting docs to California. Again, please let me know as soon as

possible.

I hope it is clear we are, and have been working very hard on this loan for you. We are at the mercy of the

lender. Whatever they say goes. Unfortunately all of our pushing back to support the value didn’t get us

anywhere. But please know we tried.

Hope to hear from you soon.

Sincerely,

Sue

1/1

(no subject)2 messages

[email protected] <[email protected]> Thu, Sep 14, 2006 at 7:12 PM

To: [email protected], [email protected]

SO NOW IVE HEARD IT ALL THIS WEEK...THE FIELD APPRASIAL WAS OK NOW IT ISNT....IN 2 DAYS????

...........SO WHAT YOUR SAYING IS WE DONT HAVE A LOAN NOW????

WHAT HOW MUCH....TERMS?? AND WHEN..............OR SHALL I SAY...THEY CAN LEND WHATEVER,

WHENEVER AT WHATEVER THEY LIKE???

LET ME KNOW

Bill,

Here is an updated on your file. We heard back from the lender. The appraised value was depreciated by the filed

review. All of the comps the field review found were upgraded properties, recent sales, had more curb appeal,

larger bedrooms and on slightly larger lots. The property has not been upgraded in quite a long time and this also

affects the results of appraised value.

Also, the lender indicated the mortgage has not been current since 6/06. This is also a factor in determining the

loan grade & terms.

There is a loan here to be done. Please direct us as you wish & we will continue working on it.

Thank you,

Sue Tate

jan wallace <[email protected]> Thu, Sep 14, 2006 at 10:18 PM


Bill there is a loan.

The field appraisal is sent out by the lender, the first appraiser was fine with the loan to value, a second appraiser;

the field appraiser was requested by the lender, this is not unheard of on hard money. The field appraiser is sent

“blind”” what this means is that they are a third party independent appraiser, no affiliation purely objective, his

decision is the final one on loan to value. His report contained the statements of information that sue forwarded to

you at end of day today in an e-mail. Sue, jennie and I worked all afternoon to talk to the lenders management to

1/2

increase the field appraisal but they would only accept the final field appraisal.

What it means to you is that the house value appraisal at 715 was re-assed at 600 thousand, the cash out will

adjust to approx. 170,000 the interest rate will adjust slightly up ,not much, which will affect the monthly slightly

up, not much

We will fight to get them to adjust their fees down, and none of the collection debt has to be paid.

YOUR loan is primary to everyone in the office, I had sue check comps and values with other appraisers in town.

The news was mixed, some appraisers, with pressure from lending institutions are trying to get over valued

properties of last year in line, the downturn in the market is making it an investors( lenders) market and some are

saying that rates may move up. If you would like , I’ll put you in contact with some of these advisors.

Bill we all feel terrible that the loan got complicated, and we will continue to work for you, at your request. Jennie

said she can call some hard money guys that she used to work with at her previous company to see if we could

get better value but that would take more time.

You can accept and sign this loan tomorrow. We can arrange for a title company in California to do the docs to

make it convenient for your mom.

The funding would be after the 3 day right of rescission from date of signing.

You can, after 6 months and after an improved credit rating can go back and re-finance and request a new

payout.

Whatever the disappointment and the approx, 50,000 dollar payout reduction, you should sleep on this

information and focus on what this will bring to you and your family. You have had many battles but you are

getting some wins and the future can be even better. Try to focus on the positive even when it frustrates you to

death.

I am always here to help in the short term, all the best to you and your mom

jan

From: [email protected] [mailto:[email protected]]

Sent: Thursday, September 14, 2006 8:12 PM

To: [email protected]; [email protected]

Subject: (no subject)


2/2

FW: (no subject)1 message

jan wallace <[email protected]> Fri, Sep 15, 2006 at 8:22 AM


From: jan wallace [mailto:[email protected]]


To: '[email protected]'

Subject: RE: (no subject)










up, not much













1/3

payout.




death.


jan









LET ME KNOW

Bill,






loan grade & terms.


Thank you,

2/3

Sue Tate

3/3

Your loan with Secured Lending1 message

Jennie DeNoia <[email protected]> Fri, Sep 15, 2006 at 12:38 PM


Bill,

Good afternoon!

I wanted to touch base with you on the appraisal issues on your loan & help give you an understanding of what

has gone into this.

I jumped into the file to help out yesterday morning because I heard we were waiting for the lender to review the

field review they ordered. I reviewed the appraisal and immediately went to work on pulling additional comps and

reviewing other internet sources to help us support a value of 715K. I prepared my argument while waiting to hear

back from the lender. I reviewed every comparable sale with them, & went over every reason why they were

cutting the value. I fought diligently to even try to get them to increase it 50,000. But as stated in a prior e-mail

addressed to you, they were concerned about updating the home, curb appeal, etc).

I understand their need to protect their investment. They are basing this entire loan the collateral (your home)

that we are providing them. The loan amount is capped at the 70% because of the credit risk on the file. Luckily

enough you have an incredible amount of equity in your home & this put you in a great position to get the loan.

So the only thing the lender has to hang their hat on is the home if the mortgage should not be paid. The current

market trend for real estate in AZ (and everywhere else for that matter) is on the down swing. Making it even more

of an issue to secure the collateral for any lender, much less a hard money lender.

I wish I could have done more fighting for you, but the lender would not bend. It is hard sometimes being at their

mercy.

The good news is that we do have a loan. And in 6 months to a year from now you can possibly refinance, get a

better rate & possibly more cash out. ☺

Sincerely,

Jennie

1/1

(no subject)2 messages

[email protected] <[email protected]> Thu, Sep 14, 2006 at 7:12 PM

To: [email protected], [email protected]





LET ME KNOW

Bill,






loan grade & terms.


Thank you,

Sue Tate

jan wallace <[email protected]> Thu, Sep 14, 2006 at 10:18 PM








1/2




up, not much













payout.




death.


jan






2/2

(no subject)1 message

jan wallace <[email protected]> Wed, Sep 13, 2006 at 8:27 PM


Bill

I,ve been trying to call you all day. You must contact me on the loan, even if you go to someone else. I told sue

to call you to update,you are over reacting this is normal

Your loan has challenges it is normal for a hard money lender to ask for a physical inspection, when your credit

is so bad and there is no stated income. We worked this loan in 10 days no one does that. I also approved

somethings personally so that this loan can go forward. You will not be able to get that some where else.

I also need to talk to you about the stock transaction.

If there is no response tomorrow, I will assume that something is wrong and I will send someone to the house to

make sure you guys are alright.

Bill I am getting worried, this is not your behavior. Contact me as soon as possible

jan

1/1

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Wallace/Black Progress Report SDI Time Period: April to June 30 Jan Wallace was hired into the position as President to guide the company’s management and the Board of Directors to conduct the business of Secured Diversified Investment, Ltd. (SDI) as best represents a Publicly Traded company.

1. The first three months are to assess the viability of the company’s mission statement as represented in its business plan, the management structure and the officers’ ability to carry out this mission and the everyday running of the company.

2. Additionally, to assess the financial viability of the company; an examination of

fiscal policy, assessment of cash flow, the company’s balance sheet and the capability of the CFO to oversee auditors and legal council to guide them through the reporting structures required by the SEC.

3. Finally, an assessment of the contracts, obligations, assets, reporting structures, liabilities, stock positioning, share distribution and its values as they relate to the public market were determined.

(1) The business plan of SDI is over-stated, lacking in detail, financial proformas and clearly is not a reliable product to release to the investor community. When asked, it was Gernot Trolf, the C.O.O., who over saw the creation of the business plan. Upon further investigation, as hard as he tries, Mr. Trolf was ill-equipped and ill-qualified to handle such a task and even though management is aware of his short comings, they still left it in his hands for years to accomplish. Wallace/Black tasked with the job of recreating a new business plan has been blocked because we are still to go through Mr. Trolf who does not want to step down. This work project has been on the agenda for 7 wks.

This same scenario exists with the website. Our receptionist, whose husband is a computer programmer, was asked to assist for a redesign of the website as a local solution, but once again, up to a week ago Mr. Trolf said he was in charge of it. SDI committed $2,500+ $1,500 to Mr. Jamieson to write a business plan to no avail as the product was weak and thusly trashed at a loss to the company.

The management structure in the company is top-heavy “more Chiefs than

Indians”.

Cliff Strand, while qualified in the real estate market, is totally unqualified to run a public company. He lacks the knowledge to make sound decisions and looks to outside council for advice (an extremely costly burden to the company as

demonstrated by Chris Wilson’s bills.) Even then the advice cannot be assessed appropriately because he has no system of “checks and balances”, the lack of personal prior experience makes it difficult for him to assess, rely or gauge the information. Thus, a chain of events, such as ill-fated contracts, deals with market makers, officers that have come and gone, and deal negotiations, has impacted the management down the chain of command and the whole company to its present dire condition. I have yet to discover records from staff meetings, organizational plans, status reports or any other kind of reports or updates crafted by the CEO, the COO or the Vice President of this company as a regular course of business.

The personal business relationships between management, the Board, officers and outside contacts, are given priority when making business decisions resulting in financial harm to the company. Examples: Chris Wilson, lawyer, friend of Kachimata, the auditor, was instrumental in the “E” on the SDI trading symbol. Don DuBeau, friends to Cliff and Bill. (the disastrous DuBeau deal.) cost the company $50,000USD. Gernot Trolf: Mr. Trolf old shareholder of SCDI now C.O.O., has proven his consistent inability to handle just about every task under his management (T-Rex damage amounts to about $50,000 loss to the company. When I requested that Mr. Trolf be removed, I was met with opposition on that decision based on “oh, he will sue” or “he’s been here so long, he drives all the way from San Diego,” “why don’t we just pay him and move him into NCB” or “let’s just find something for him to do.” Gernot Trolf: Mr. Trolf has no fit in his role as C.O.O. or the ability to handle the majority of the tasks he considers under his job description. He has mishandled virtually every asset in the SDI family of properties. He just barely avoided the threat of a harassment suit from a former receptionist. He develops problematic relationships between he and property managers. He has caused rental losses from T-Rex. The company should remove this position, the title and eliminate the payroll burden. . Cliff Strand: Mr. Strand CEO runs the company like that of a private entity. He does not grasp that the responsibility of a CEO is, “the buck stops here”. No matter the prior management inabilities, the blame cannot be shifted. It cannot always be someone else’s fault, never his. If he truly possesses the capabilities of his title and has the sufficient knowledge to counter poor decisions, he would have a better, more successful company. He does not.

Bill Biddle: Mr. Biddle serves as Vice President of Acquisitions. Bill Biddle’s ability to harness “good properties” is not a sufficient qualification to retain him as a full-time employee or an officer of the company. First, he can do this from anywhere; instead he drives 2 days a week running up expenses for the company, commanding a large salary that the company cannot afford. There has been no activity for almost 2 years in acquisitions. As a director he has no knowledge of the public market or the ultimate responsibility of holding a seat and the ramifications of his decisions on a public Board. His personal behavioral habits cannot be tolerated. His constant yelling and barrage of threats to fellow officers and employees, and his inability to follow procedure and guidelines is a recipe for disaster. His style of presentation does not instill outside investors with confidence. While his personal contributions are heart felt and personality charming, the company should take the appropriate business steps to neutralize the situation. Munjit Johal: Mr Johal serves as CFO, and has demonstrated a high degree of competence and great patience in dealing with individuals who are inexperienced in understanding the financial processes necessary to keep this company reporting according to the rules set out by the SEC, or of even simple accounting practices. Poor legal counsel via Chris Wilson, and Cliff Strand, CEO, who wants to argue with procedures he does not understand, has stymied and put him in harms way, as a signing officer of the company. Cliff authorizes expenditures with little responsibility to its loss or consequence to the company’s bottom line, or profitability. It was Mr. Johal who was first to forgive accruals, and took no personal stock incentive to reduce the debt of the company. It took 6 weeks to work out contracts that reduced approximately $750,000 dollars of debt off the books of the company, which will result in a positive quarter for the first time on the company’s books. Mr. Johal is an officer of this company and deserves his salary. Jim Brondino: Mr. Brondino is a consultant to the company. M r. Brondino brings some much needed conservatism and organization to the company’s property acquisitions and on-going property management. He is focused and diligent in his tasks and has the experience to make sound decisions. He is instrumental in delivering a high quality work product that will help the company to become more efficient and consistent in its documentation. These products will move the company forward while, removing the ill-fated guess work that presently exists

. (2) Financially the company is virtually insolvent. Its debts cannot be serviced by its income stream. The auditors also have a “going concern” on the books. The company has just come off of an “E” on its symbol, which impedes the company’s ability to raise capital. The stock is depressed with no trading

volume. The float of the company, (2 million shares), has been impaired, which makes it impossible to make a market in the stock. Millions of shares of stock will be free-trading shortly, which will once again put pressure on the stock. Munjit, the CFO, the auditors and Kyleen Cane, the company’s present S.E.C. attorney, are poised to file the needed amendments, because of the “E,” to get the company back in proper reporting order. The shortage of capital requires that Munjit has no choice but to freeze company funds in order to use cash proceeds where it is most needed. He is ultimately tasked to take care of the financial status of the company and is personally libel under the Sarbanes-Oxley Act. His decisions must be heeded, as it is his responsibility. I support him 100%. The Board must look at all alternatives, including a Chapter 11 re-organization in order to protect the company’s assets if so required. The Board cannot sit back and wait for $2 million “on the come” from the sale of the Cannery as a solution. Part of my mandate is to bring capital into the company. The “E”on our symbol was our first impediment to bring investors. The second was the heavy burden of the payroll debt of the company and the over inflated salaries. Every investor Wallace/Black introduced to SDI was not interested in putting “new money to pay old debt” All of this was relayed to Cliff and Bill and Gernot. Actions were taken to re-write contracts. Bill said he would not sign and give up anything unless he sees an investor that can deliver. Against my better judgment, I brought in an investor, Mr. Leonard Yablon, at my own expense. My assessment was that the company, under due diligence would not stand up, the enclosed report is the outcome.

Immediate cash infusion is mandatory to the survival of SDI (3) Following are contracts, liabilities, shares and lawsuits on going and or settled. -Duane Schwaab- settled at a cost of $1,800 gain to the company, plus share certificates were issued dating back 16 months. -Carlos Royal- Approximately $21,000 of an outstanding commission payment was settled for $10,000 cash $5K+$5K over two months and the rest in stock certificates which were delivered. Bob Jaimieson (on-going) $1,500 for a business plan this is still outstanding, but feel very confident that we will lower it by half. -Louis Leon law-suit is on going. $15,000 has already been spent. We are looking for a summary judgment. The suit is dependant on Cobra issues

The release of the services by Chris Wilson, attorney, who was a totally ineffectual attorney for SDI. His poor advice will be felt through this company for a while.

• He has moved out of our offices. He owes rent and is holding over $5,000.00 deposited in our trust account and will not release these fund. Presently, SDI is getting the documents to file a complaint to the Bar in California.

• REIT shares; the float of the company shall be restated on the company’s books to add 2 million free-trading shares. This may create a negative impact on the share holdings of Cliff Strand, Bill Biddle, Bob Leonard, Sumy Leonard and Wayne Sutterfield, but is a great positive impact to the company. It will be placed back to where it should have always been. It allows the company to access market makers to make a market in the companies stock, which will add value to the company and its shareholders.

• A new competent SEC. attorney is in place, and will reduce costs associated with the filings of the company by half over that of last years costs, under Chris Wilson.

• Also on going corporate counsel has been retained and available to the company for only $2,000.00 per month.

• Installed organizational charts and documents to assist with due diligence pertaining to our present and future properties, including financial forms to track our monthly rent rolls.

• Removed old employment contracts and accruals to a reduction of debt of over approximately $750,000USD.

• Issuance of stock to multiple parties that have been outstanding for over a year.

• Clarification of the company’s bylaws, compensation and audit committee for the officers and directors to properly account for the company.

- T-Rex (on going) The company is in a default position of about $46,000.00. Notice has been given by Gary Vandenberg. Company has set up a task force to handle the problem: Jan Wallace – negotiation

• Jim Brondino – day to day monitoring of T-Rex Business.

• Cliff Strand - to market and rid the company of the T-Rex from SDI It is presently on the book at zero valuation. Presently Jan has negotiated a stand still until after the board meeting (E-mails enclosed).

• A standstill oral agreement is in place over a 30,000USD agreement with a marketing company that was signed a year ago by Mr. Strand. We have informed the company that we will not pay towards this agreement. At best, they may want to accept 3,000USD as a form of settlement.

Every day more issues come up and is handheld swiftly there is no longer any time to leave issues to ponder.

In closing, I was hired to spend 3 days a week on the business of SDI at $8,500 a month. I presently spend twice that time on the business of SDI and have the cell phone and office phone records to prove it. The present management of SDI is ineffectual. What they don’t know or understand, their inability to change to formal structure, to remove personal involvement from business issues, which only clouds their ability to make decisions to problems that present themselves on a daily basis, will only bring further harm to the company. My first 3 months and my ability to effectuate change could have taken much less time than it has, if the education process with management had not been so consuming. So, all personalities aside, this Board is presented with hard business decisions. This is a public company and an on-going business. My recommendation is to create a plan to remove Cliff Strand as CEO, Bill Biddle as Vice President of Acquisitions and Gernot Trolf as COO of SDI. Munjit to immediately put tight financial constraints in place to reduce overhead and personel until the company has cash infusion.

-Allow Jan Wallace to work with Jim Brondino to assess the company’s assets and fix, sell or renegotiate leases for the company’s properties. -Allow Jan Wallace to run the day to day operation of the business as is necessary in a public company. Otherwise leave everything status quo and proceed as you see fit.

Yours respectfully Jan Wallace Chairman, Wallace/Black

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1

CONFIDENTIAL

SETTLEMENT AND GENERAL RELEASE AGREEMENT

This Settlement and General Release AGREEMENT ("AGREEMENT") is entered into by and

between IOMEGA INVESTMENTS, LLC ("IOMEGA") and SECURED DIVERSIFIED INVESTMENT, LTD. ("SDI") referred to jointly as the ("PARTIES") as of the date this AGREEMENT, December 14, 2005, on the following terms:

RECITALS

WHEREAS on May 12, 2004 IOMEGA ("Lender") and SDI ("Borrower") entered into an

Unsecured Installment Note, last installment was to be paid on May 14, 2006.

WHEREAS IOMEGA currently owns 250,000 shares of SDI preferred C stock (the "Preferred Shares") at a value of $3.00 per share evidenced by certificate number 1001.

WHEREAS, the PARTIES have, between themselves, negotiated a complete resolution of any and all disputes, claims or potential claims arising between them and the subject matter of the Unsecured Installment Note dated May 12, 2004 and the shares of SDI and intend, by the terms of this AGREEMENT, to memorialize the resolution of all disputes, claims or potential claims between the PARTIES arising during their relationship.

A G R E E M E N T

1. WHEREFORE in consideration for the promises set forth herein, the PARTIES agree as follows:

a. The PARTIES agree that upon execution by IOMEGA this AGREEMENT, SDI shall pay to IOMEGA the gross amount of forty thousand dollars ($40,000.00) as payment in full on the Unsecured Installment Note dated May 12, 2004.

b. The PARTIES further agree that IOMEGA will be entitled to immediately

exercise its conversion rights for its preferred shares at the current market price for SDI’s Common Stock at the time of notice to the transfer agent.

SDI makes no representations or warranties regarding the tax effect of the

settlement proceeds as directed by this AGREEMENT. Further, IOMEGA agrees to defend and/or indemnify SDI with respect to any liability created by IOMEGA'S payment or non-payment of taxes with respect to the settlement sum.

2. IOMEGA, as the first party, and SDI as a second party, on their own behalf and on behalf of their respective dependents, successors, heirs, executors, administrators and assigns, and each of them, hereby fully and forever releases and discharges each other, as well as SDI's parent, subsidiary or affiliated companies or organizations, as well as its agents, officers, directors, stockholders, employees, successors, assigns, insurers and attorneys, and each of them, of and from any and all claims, rights, actions, causes of action, obligations, debts, interest, damages. charges, losses, debts, penalties, forfeitures, liabilities, costs, attorneys' fees, and demands of any nature, whether arising in law or in equity, arising out of or relating to any acts or omissions that took place prior to the date of this AGREEMENT.

2

3. It is the intention of the PARTIES hereto that this AGREEMENT shall be effective as a full and final accord and satisfaction and release of each and every released matter, including all unknown and/or unsuspected claims. Accordingly, the PARTIES hereby waive and relinquish any and all rights or benefits that any party may have under the provisions of Section 1542 of the California Civil Code, which reads as follows:

"A general release does not extend to claims which the creditor does not know or suspect to exist in its favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor."

In connection with this waiver, each party hereto acknowledges that facts in addition to

or different from those presently known may later be discovered which relate to the subject matter of this AGREEMENT. The PARTIES also recognize the possibility that, in the future, damages that are not currently known may be suffered in relation to matters released in this AGREEMENT. Notwithstanding these possibilities, it is each party's intention to fully, finally and forever settling and release all released matters, disputes and differences, whether known or unknown, suspected or unsuspected, that have existed, now exist, or may exist. It is the intention of the PARTIES hereto that this AGREEMENT shall be effective as a full and final accord and satisfaction and release of each and every released matter, including all unknown and/or unsuspected claims. In connection with this waiver, each party hereto acknowledges that facts in addition to or different from those presently known may later be discovered which relate to the subject matter of this AGREEMENT. The PARTIES also recognize the possibility that, in the future, damages that are not currently known may be suffered in relation to matters released in this AGREEMENT. Notwithstanding these possibilities, it is each party's intention to fully, finally and forever settle and release all released matters, disputes and differences, whether known or unknown, suspected or unsuspected, that have existed, now exist, or may exist. Nothing in this AGREEMENT constitutes, or should or shall be deemed to constitute, any admission of any act, fact or liability, with respect to any matters released herein.

4. The contents and the existence of this AGREEMENT, and the PARTIES' discussions pertaining to it, are and shall remain confidential, and neither party will communicate or allow communication in any manner (written or oral) to anyone with respect thereto, except that this AGREEMENT may be disclosed as required to the PARTIES' attorneys, insurers, accountants and/or governmental taxing authorities, or otherwise may be disclosed as compelled by law. SDI has informed IOMEGA that it would suffer serious damages if this Paragraph is violated.

5. Each party agrees to bear its/his own costs, expenses and attorneys' fees incurred in connection with the ACTION and this AGREEMENT except as stated in I .b above.

6. Each party hereto expressly warrants and represents that they is fully authorized to enter into this AGREEMENT and each of its terms, and that they has not assigned to any other party or person any claims released herein.

7. IOMEGA warrants that it has not filed any lawsuits, charges, complaints, petitions, or other accusatory pleading against SDI with any governmental agency or in any court, based upon, arising out of or related in any way to any events occurring prior to the execution of this AGREEMENT. IOMEGA further agrees that it will not hereafter file, cause to be filed, or otherwise voluntarily participate in the filing, investigation, and/or prosecution of any other such charges, complaints, petitions or accusatory pleading brought by any other party in any court or with any governmental agency in which SDI or any affiliated company is named as a party.

3

8. This AGREEMENT contains the entire AGREEMENT between the PARTIES hereto with respect to all matters addressed herein, and fully supersedes any and all prior or contemporaneous agreements, understandings or representations, oral or written, implied or express, pertaining to the subject matter hereof. This AGREEMENT may only be subsequently modified by a writing signed by all PARTIES hereto.

9. Each party agrees to do all things necessary to carry out and effectuate the terms of this AGREEMENT, and expressly promises not to do or fail to do anything, directly or indirectly, which will interfere with any other party's realization of the benefits hereof.

10. This AGREEMENT, including the releases herein, shall be binding upon and inure to

the benefit of each of the PARTIES to this AGREEMENT and to each of their successors in interest, including heirs and assigns.

11. The PARTIES acknowledge that they have read and understand this AGREEMENT

and are fee to seek the advice of independent counsel prior to execution and waiver of this right. Accordingly, the rules of construction of contracts relating to resolution of ambiguities against the drafting parties shall be inapplicable to this AGREEMENT.

12. Any construction, interpretation and performance of this AGREEMENT shall be

governed by the laws of the State of California, both substantive and procedural. Both PARTIES accede to the jurisdiction of the Orange County Superior Court for any actions to enforce, or for breach of, any term of this AGREEMENT.

13. If for any reason any provision contained in this AGREEMENT is later deemed

unenforceable, the remainder of this AGREEMENT shall nonetheless remain binding and enforceable on all PARTIES hereto.

14. In the event of any action brought to enforce any provision of this AGREEMENT, or for breach of any provision of this AGREEMENT, the prevailing party therein shall be entitled to an award of its/his costs and reasonable attorneys' fees incurred therein, in addition to any other relief.

15. Each party hereto agrees to execute such further papers or documents that shall be necessary or proper in order to fulfill the terms and conditions of this AGREEMENT.

16. Each of the PARTIES to this AGREEMENT covenants and agrees that the persons

executing this AGREEMENT are authorized and empowered to enter into and execute this AGREEMENT for and on behalf of the person and/or entity they represent, and by their execution hereof, each respective entity or person they represent, and all persons, partnerships, corporations, trusts, joint ventures, and any person or thing affiliated therewith shall be bound by the terms hereof. 17. The PARTIES acknowledge that they have read and understand this AGREEMENT and are free to seek the advice of independent counsel prior to execution and waiver this right.

18. Each party has had the opportunity to investigate this matter, determine the advisability of entering into this AGREEMENT and has entered into this AGREEMENT freely and voluntarily. Each of the PARTIES acknowledges that in executing this AGREEMENT they rely solely on their own judgment, belief and knowledge and on such advice as they may have received from their own counsel and that they have not been influenced by any representation or statements made by the other party or its counsel.

4

19. No breach of any provision of this AGREEMENT shall be deemed waived unless it is waived in writing. Waiver of any one breach shall riot be deemed a waiver of any other breach of the same or any other provision of this AGREEMENT.

20. Time is of the essence with respect to any act or performance hereunder.

21. This AGREEMENT may be executed in multiple originals or counterparts, each of

which shall be deemed an original or the equivalent thereof. This AGREEMENT, shall not be effective in any way as to any of the PARTIES until fully executed by all PARTIES.

WHEREFORE, each party hereto, by the signatures below, certifies that this AGREEMENT has been read in its entirety, that any questions regarding the meaning or effect of any terms have been answered to their satisfaction, that each party enters into this AGREEMENT with the intent to be fully

and forever bound by all of its terms, as of the date set forth opposite their signature below.

IOMEGA INVESTEMENTS, LLC

Dated: December 14, 2005 By: __________________________________

HELEN WEST MANAGING PARTNER SECURED DIVIERSIFIED INVESTMENT LTD.

Dated: December 14, 2005 By: __________________________________

JAN WALLACE MANAGING PARTNER STATE OF ARIZONA COUNTY OF MARICOPA This instrument was acknowledged before me this 14

th day of December, 2005, by Helen West and Jan Wallace.

In witness whereof, I herewith set my hand and official seal.

NOTARY PUBLIC

31794550 Summary Secure Diversified Investments and Lending Part 1

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Transcript of 31794550 Summary Secure Diversified Investments and Lending Part 1