SETTLEMENT AND ARBITRATION AGREEMENT This Settlement and Arbitration Agraement (hereinater referred to as the “Agreement’) is made this _/07& day of Bho, 2004, by and betwesh (hereafter rsterred to as the Altgona-Johnstown, Bishop Hogan and Bishop Adam “Diocese’), “Claimant?) and the Diocese df ec (hereafter referred to as the {9 paricinate in the setierent which has been negotiated by the Cleiman} {rough histher counsel, and the Diocese, through its representatives and counsel, Th Claimant shal execute one orginal ofthis Agreement, and the Diocese, trough their uh appointed representative, shall execute one orginal of his Agreement, The Claimant ang ‘he representative ofthe Diocese wil also sign at the same time, the respective Mutuel Releases which are attached hereto and marked as Exhibits "1" and “2” In edd! Claimants’ counsel will sign Praecipes to Sete and Discontinue all of those cases which Ore presently pending in the Court of Common Pleas of Bait County, which orginal Praecipes will be delivered: ito the Arbitrator, The Honorable David Ward Murphy, to be | held in escrow. Copies of the Praecipes to Settle and Discontinue the cases will be provided ‘© counsel forthe Diocese, The Claimant and the Diocese have agreed to execute thd Mutual Releases in the forms attached as Exhibits “1" and "9° Releases to the Arbitrator to be held in escrow, Claimant will not contain the exact amount of m™m and will provide the Mutual The Mutual Release signed by the loney 10 be paid to the Claimant in Satisfaction of all claims since that amount wil not be known until the conclusion of th arbitration proceedings, The Arbitrator will insert the dollar amount of the award to the Claimant at the time that the Arbitrator announces all of the awai ds, and the Claimant will, be bound by the decision of the Arbitrator, For and in consideration ofthe promises set forth in this Settlement and Arbitration Agreement and the Mutual Releases attached hereto and marked as Exhibits" the parties hereby agree as follows: 1 "and "2", ‘he Diocese will pay Claimant to settie all claims which existed In the past and presently exist and which may exist in the future related to sexual abuse an amount of ‘money to be Poeses37.1 With respect to the Claimant's ciaims against the Diocese and the Bishops, Page 1 of 8 |determined through arbitration, the terms and conditions of which are set forth below. The arbitration shall be conducted by the Honorable David Ward Murphy of Justus. Mediation, 2, The arbitration awards shall be to compensate each of the previously Ndentified Claimants who has presented a sexual abuse claim for physical, mental emotional injury and physical sickness sing out of the alleged abuse sot forth and described in the complaint filed in the Court of Common Pleas of Blair County, of Presented through counsel along with affidavits, and to be expanded upon before the Arbitrator during the arbkration proceeding, The actual amount to be paid by the Diocese to the Claimant will be determined by the Arbitrator. The amount ofthe arbitration award applicable to all claims for sexuel abuse shall be no less than Fifty Thousand and 00/104 ($50,000.00) Dotlars andno more than Four Hundred Thousand and 00/400. ($400,000 00 Dollars for each individual Claimant, except in one previously identified case where the award, if any, could at the Arbitrator’s sole discretion be less than Fifty Thousand anc 00/100 ($50,000.00) Dollars. The ertera forthe evaluation to be made by the Arbitratod shail include but not be limited to the ‘type of abuse, its duration, the extent of the injuries, and the effect of the abuse onthe Claimant. Suggested Damage Valuation Considerations, 'sattached heretoand marked Exhibit3, The sole responsibilty of the Arbitrator ia to place value on the claim of the Claimant and not to determine issues of lability. 3: The aforesaid sum being paid by the Diocese shall constitute payment of damages on account of personal Injuries or sickness, within the meaning of Section 104(2)(2) of the Internal Revenue Code. of 1986, as amended. 4 The Diocese and all Claimants will share the cost of the arbitration Proceedings, including the fees charged by the Arbitrator, and all incidental expenses nl ‘elated costs equally, fifty (50%) percent to be paid by the Diocese and fifty (50%) percent! to be paid by the Claimants. It is the understanding of the parties that the cost of the Arbitrator is Three Thousand and 00/100 ($3,000.00) Dollars per day, plus Two Hundred| Fifty and 00/100 ($250.00) per hour for all preparation including review of materials in| anticipation of the arbitration Proceedings and for review of the materials following the| proceedings and the rendering of the awards for each individual Claimant, The arbitration proceedings will take place in the offices of counsel for the C ossesa71 Page 2 of 8necessitate the proceedings taking place in another location in the Altoona/Holidaysburg ‘rea. The arbitration proceedings will take place on May 24, 26, 28, and 27, 2004, 5. Al the arbitration hearing, each Claimant shall make a presentation or such Presentation shall be made on behalf of each Claimant concerning the facts surrounding {he Claimant's claim and the damages that he or she euffered as a result of the alleged abuse. The Claimant's arbitration hearing shall be no longer than two (2) hours unless. greed upon by the parties and the Arbitrator, The Arbitrator may ask questions of the! Claimant in order to obtain information relevant to the Arbitrator’s evaluation of the Claimant's claim for damages. The Diocese, through counsel, will be provided an opportunity before a Claimant's hearing to provide the Arbitrator with information relevant tothe Ciaimant’s claim for damages, which information will have previously been provided to counsel for the Claimant, Each Ciaimant should appear, uniess reasons exist for a Claimant not being present and making a presentation to the Arbitrator. In addition to the Claimant's presentation, information may be provided to the Arbitrator by counsel for the Claimant and witnesses, and documentary evidence may be provided to the Arbitrator Documentary evidence that will be presented to the Arbitrator on behalf of a Claimant will be provided to the Diocese, except in circumstances where the documents are determined by the Arbitrator to be particularly sensitive, If a Claimant Is not physically able to attend the hearing, then the Claimant may presont evidence by videotape, audiotape, telephone, oF video-conferencing, as well as through counsel, witnesses and documentary evidence. Each Claimant may submit forensic evaluations, reports and statements from health-care Providers and professionals, although not required, 6. Present at the arbitration proceadings will be the Bishop or his designated representative, presumably the Vicar General, The Bishop or his representative will be afforded an opportunity to address the Claimant at an appropriate time during the hearing | to express the apologies of the Diocese unless the claimant would profer thal the Bishop or his representative not be present atthe arbitration proceedings. Also presant will be | Larry Sutton, the Director of Finance for the Diccese, Michael Burnett of the Gilead | Society, who will appear for the purpose of assisting the Diocese in its presentation of its | case to insurance carriers for reimbursement, and counsel for the Diocese. The Possess. Page 3 of 8representatives of the ‘ocese will not ask any questions of a Claimant or his or her ‘witnesses during the proceeding, Inthe ‘event reprasentatives of the Diocese believe that! Inguity andior expansion of a particular area of a Claimant's presentation is necessary, @ recess will be held in order to allow the representatives of the Diocese to discuss the Additional information with counsel for the Claimant, 7. The Arbitrator’s awards shall be issued within ten (10) days of the date of the ‘ast hearing of all the Claimants. The awards of the Arbitrator shall be issued on the same ay and collectively exhaust the agreed-upon, total aggregate amountof the settlement for compensating the participating Claimants, which is $3.6 Million ($3,500,000.00) Dollars 8 The parties further agree that an additional sum of Two Hundred Ten Thousand and 00/100 ($210,000.00) Dollars, will be placed by the Diocese in an account OF trust on or before June 15, 2004, solely for the purpose of paying for psychiatric, Psychological and/or counseling services including prescribed medications to be provides fothe individual Claimant, The sum of Ten Thousand and 00/100 ($10,000.00) Dollars will be allocated to each Claimant. At the expiration of four (4) years, if a Claimant has not ‘exhausted the Ten Thousand and 00/400 ($10,000.00) Dollars allocated for that individual Claimant's trestmenticounseling expenses, the balance may be utlized by other Claimants whose treatmenticounseling expenses exceed Ten Thousand and 00/100 ($10,000.00) Dollars. At the end of eight (8) years, all money that has been allocated for troatment/counseling but not used for those purposes will be returned to the Diocese. The funds allocated for the reatment/counseling willbe maintained by a mutually agreed upon Corporate fiduciary Independent of the Diocese, and a Trust Agreement or similar type agreement outlining the provisions for the payment of the treatment/counseling fees will ‘be prepared and mutually agreed upon by the parties and their counsel, 8. The decision of the Arbitrator shall be final and binding on the parties, The Diocese willissize payment within ten (10) days of the issuance of the Arbitrator’s decision, which payment shall be made by delivery of a certified check in the amount of $3.5 Millon Dollars mace payable to Serbin, Kovaes & Nypaver, LLP, Counsel for the Claimants wit be Solely responsible for the distribution of the amount of the award to each individual Claimant, and the Diocese wili not be responsible for any further payments, Poseeesr.s Page 4 of 810. At tho time the Arbitrator receives notification of payment of the total Settlement funds to Serbin, Kovacs, & Nypaver, LLP, and deposit with the corporate Fiduciary of the treatment fund, he shall deliver to counsel for the Diocese the signed Praecipes to settle and discontinue the dockets of all lawaults pending in the Court of ‘Commen Pleas of Blair County for filing with the court, and the Arbitrator will deliver the Releases signed by the parties to respective counsel. WE HAVE READ THE WITHIN SETTLEMENT AND ARBITRATION AGREEMENT, CONSISTING OF SEVEN PAGES, UNDERSTAND THE SAME, ANDAGREE "| TO BE LEGALLY BOUND BY ALL THE TERMS OF THIS AGREEMENT. ‘CLAIMANT IN WITNESS WHEREOF, | have hereunto set my hand and seal this Jett day of, Mess , 2004, CLAIMANT: On this [xt day of May » 2004, befére me personally dppeared to. me known, and known to me to bo the same person described i in.and who executed the above instrument, and that he severally acknowledged to me that he executed same. Notary Public a My Commission Expires: eonaeso7.4 Page 5 of 8Msn DIOCESE OF ALTOONA-JOHNSTOWN, BIGHSP HOGAN IN WITNESS WHEREOF, I have hereunto set my hand and seal this . 07> ay of “nary , 2004. Msqe. Michael Secoinsk JBioecdtshor os Onthis 1% day of tay. , 2004, before me personally appearad ombehsitotthe Blocese ef AteonaJahastown, Bishop: jithae] Serumns& * dagen’ Bishop-adame, to me known, and known to me to be the same person. described in and who executed the above instrument, and that he severally acknowledged to me that he executed same, Notary Public ae {wy ConmlesaPeaSbe nc hos | LY Connie Ero Win 2, foo | oneesa7 4 Page 6 of 8 yDIOCESE OF ALTOONA-JOHNSTOWN, — GIGHOP ABAMES IN WITNESS WHEREOF, | have hereunto set my hand and seal this _7@7> day of_-wey 2004. ishop Adamec Onthis _jo% _ day of 2h 2004, before me persenally appeared) Burkey, Tosinh Adem ac. on ‘behalf of the Diocese of Altoona-Johnstown, Bishep| Hegewarrr Btsrop-Attamec, to me known, and known to me to be the same person Sescrived in and wno executed the above instrument, and that he severally acknowledged| tome that he executed same. Notary Public ommission Expiiés; 0596597.1 Page 7 of 8DIOCESE OF ALTOONA-JOHNSTOWN IN WITNESS WHEREOF, | have hereunto set my hand and seal this _/e7 day of _-rtaw 2004, DIOCESE: Onthis 707% dayof hay , 2004, before me personally appeared| Bithey Teteph. V Adeanee on behalf of the Diocese of AltoonaJohnstown, Bshep Hogereame Bishop-Adamee, to me known, and known to me to be the same person| described in and who exacuted the above instrument, and that he severally acknowledged to me that he executed same. Notary Public ie rey si Cary ised rt in S| Poeses37.1 Page 8 of 8off, Le County, fppotnt, effective immedietdy, ts my agent, My agent shall have fall power of tution, Tor'me and in my dame, to transact all my business and to manage all my property and affairs as I might do if personaly present, including but not limited to exercising the following powers, Durable Power of Attorney ‘This power of attorney shall not be affected by my subsequent disability or incapacity, All acts done by my agent pursuant to this power during any period of my disability or incapacity shall have the same effect and endure to my benefit and bind me and my successors in interest as if were competent and not disabled. Management of Assets 1. Cash Accounts: To collect and receive any money and assets to which I may be entitle, to deposit cash and checks in any of my accounts, to endorse for deposit, transfer or collection, in my name and for my account any checks payable to my order, and to draw and sign checks for me and in my name, including any accounts opened by m agent in my name at any bank or banks, savings society or elsewhere, and to receive and apply the proceeds of such checks as my agent deem best; and to act as my ‘representative payee for all Social Security, Medicare, and other federal and state benefits, 2. Resl Este: To lease, sell, release, convey, extingulsh or mortgage any interest in any real estate I may own, on such terms as my agent deems advisable, and to purchase or otherwise acquire any interest in and acquire possession of real property and ‘to accept all deeds for such property; and to manage, repair, improve, maintain, restore, build, or develop sny real property in which I now have or may later acquire an interest. 3. Bersonal Property; To buy or sell at public or private sale for cash or credit or by any other means whatsoever; to acquire, dispose of, repair, alter or manage ‘my tangible personal property or any interests therein’ 4, Safe Deposit Boxes: To have access to all safe deposit boxes now or hereafter standing in my name; and to add to and to remove all of the contents thereof, ‘and 109 enter into leases for such safe deposit boxes or surrender them, S. ngurnnee: To procure, change, carry or cancel insurance of such kind in such amouots against any and all risks affecting property or persons agains: liability, damage or claim of any sor,16, All actions of my agent shall bind me and my heirs, listiburees, legal representatives, successors, and assigns, and forthe parpose of inducing enyone to actin accordance with the powers [have granted herein, I hereby Tepresent, warrant and agree that if this power of attorney is terminated or amended for any reason, T and my heir, distributees, legal representatives, successors, end assigns will hold such party or partes harmless from any los suffered or lability incurred by such Part or parties while acting in socordance with this power prior to that party's recsipt of ‘written notice of any such termination or amendment. 17, Pennsylvania Law Govems: Questions pertaining to the validity, ‘construction and powers created under this instrument shall be determined In accordance ‘with the laws of the Commonwealth of Pennsylvenia. vd bn have signed this power of attorney this USth__Winy of “Naren 2002, ames Hogan Name a on this the {5 Maay of a on this che | yf —Zneeh, 2002, porsonarty appeacea 2 undersigned authority, far . known to me, to be the person whose nan€ to nieocktend toEo gbove within the Powar of Attorney, and acknowledged thes Te executad the game for the purposes tharein contained. #8 WITNESS WHEREOP, T have hereunto set my hand and notarial vq jal.FULL AND FINAL RELEASE KNOW ALL MEN BY THESE PRESENTS, that I,’ . being of fulllegal age and of sound mind, for and in consideration of the promises and undertakings contained the Settlement and Arbitration A, ment, and in consideration of the total sum of » the sufficiency of which is hereby acknowledged, and lawful money of the United States of America, to me in hand pa by ‘ne Diocese of Atoona-Jchnstown, the receipt whereofis hereby acknowledged, do ereby release and forever discharge, the Diacose of Altoona-Johnstown, Bishop Joseph v ‘Adamec, Bishop James Hogan, all former bishops in both thelr Individual and official capacities, and any other person or entitles affiliated with the Diocese of Altoona! Johnstown, their successors and assigns, and any and all other persons or entities of any kind from any and ail liabilly, claims, causes of action, damages, costs, expens or Gemands of any kind whatsoever in law or in equity, and, specifically from any claims of Joinders for sole ilabitty, contribution, indemnity or otherwise, which against the Diocese of Altoona-Johnstown, Bishop Joseph V. Adamec, Bishop James Hogan, and all otherg. feleased herein, | ever had, now have or which | may have inthe future, or which my heir} executors, successors, and assigns hereinafter can or may have by reason of any bodlh injuries, and personal injuries and damages sustained by me, and the consequences thereof, known or unknown, foreseen or unforeseen, arising or which may arise as.a result of orn any way connected with the incidents of alleged sexual abuse which have formed the basis of my claims against the Diocese of AltoonaJohnstown, Bishop Joseph V! Adamec, Bishop James Hogan, and ail other parties released herein and which arg Pocwes.s Page 1 of 3described more fully and set forth at langth in the Complaint fled in the Court of Commen| Pleas of Blair County at Number {tis further understood and agreed that the acceptance of this sum is in full accord] and satisfaction of a disputed claim, and the payment of this sum is not to be construed| a8 an admission of liability on the part of the releasee, and lability is hereby expressty| denied, {tis further understood and agreed that this is a complete release agreement and! {hat there is no written or oral understanding or agreement directly or indirectly connected! with this release and settlement, other than the Settlement and Arbitration Agreement) referred to above and signed ‘by me; and not incorporated herein. 'tis tunher understood and agreed that | am responsible for the payment of any| liens or charges against this settlement sum including ail liens and/or claims by Medicare, Medicaid and/or any othr health-care provider, any attorneys, lawyers or counselors, and any claims for workers’ compensation subrogation. Should any person or entity make! claim for payment of any tiens or charges against the released parties forcosts, expenses and fees associated with any claims against tho released parties, | hereby agree tol indemnify and hold harmless the said Diocese of Altoona-Johnstown, Bishop Joseph V, Adamec and Bishop James Hogan from. any and all liens, charges, fees, costs, interest, and other sums arising out of the payments made pursuant to this settlement. ‘hereby declare that I fully understand the terms of this settlement, that the amounts| ‘stated herain and in the Settlement and Arbitration Agreement are the sole consideration| for this release and that | have voluntarily accepted the said sums for the purpose of making a full and final compromise and sottiement of all my claims, Powoasst.1 Page 2 of 3‘This agreement shall be construed that wherever applicable, the use of the singular umber shall include the plural number and the masculine gender shall be construed tol include the feminine or neuter gender. | HAVE READ THE WITHIN RELEASE, CONSISTING OF THREE PAGES UNDERSTAND THE SAME, AND AGREE TO BE LEGALLY BOUND. BY ALL THE TERMS OF THIS RELEASE AND AGREEMENT. IN WITNESS WHEREOF, | have hereunto set my hand and seal this 1g day of} , 2004, CLAIMANT: v y On this Lg day of A ag 2004, before me personally appeared #, to me known, and known to me to be the same person described| in and who executed the above instrument, and that he severally acknowledged to me that| he executed same, Notary Public My Cdmmission Expires; ooee631.1 Page 3 of 3(GENERAL RELEASK ‘We, BISHOP JOSEPH V, ADAMEC, BISHOP JAMES J. HOGAN and THB DIOCESE OF ALTOONA JOHNSTOWN (heceinafter the Releasors), for and in consideration ofthe promines end ‘undertakings contved ina separate Stlement and Arbitration Agreement entered Into between the partie, the suficieney of which i hereby slanowiedged, hercy forever rmisea, releases and forever Aisenargen “Ye Claman”) nd Clamans hers, ttomneys (SERBIN, KOVACS & NYPAVER, LLP, their agents servants, o employees), executors, predeccoom, parents, succestors, agents, servans, employees and assigns of aud from say and al debts, demands, ations, causes of action, sults, account, covenants, contracts, agreements, damages, judgunents, exeeution, onder and any and all laims, desnancs and Tabilies whatoever of every namie and nature, whesher in LAW, in EQUITY, or otherwite which the Relensors ever had, now have, or which Releasors or Releasors' successors bereinalter can, shall or may bave by reason of my matter, ezuse of thing ‘oatsoever fom the beginning of the world tothe date of tie Release, and whether mich claims are now Jnown oF unknown, arising from or relating to an aUeged actor acs of sexual sbuse with respect to Claimant arising from or related to claims asterted by Claimant against Releasors, including without Hinting the generality ofthe foregoing, auy end ll elim made or that might have beeu made in any pending clair or suit, arising out of an alleged actor acts of sexual abuse with respect to the Claimant, This Relense isnot o be construed ts wi admission of Liability upon the part ofthe Releasors, but rather as good fait settlement of disputed elain, IN WITNESS WHERROF, the Releasors have set (his/ts) hand and geal to this Release as of the date writen below, DATE Mag 14, ee * IygHOPAOSEP V-ADAMEC Sworn ani sacha to oloo me hit OP day of May, 2004 "Notary Publis DATE:_Hhege 22, Deed be 4 ‘Swory and sbsexibod to before me thir Loras Swap aad ert ws before eis | ate ay ty, 2004 ian LgeEXHIBIT 3SUGGESTED DAMAGE VALUATION CONSIDERATIONS LEVELI = ABOVE CLOTHING GENITAL FONDLING Category A» One time occurrence; Category B Multiple times; Category C Other aggravating factors (in no particular order) (1) Age at time of molestation; @) _Kfthe perpetvtor was a priest; (3) Location of illegal acts (ie, church property); @) Provided alcohol; (8) Exposure to porography; (©) Need for psychological counseling. LEVEL IY - UNDERNEATH CLOTHING GENITAL FONDLING AND/OR MASTURBATION Category A One time occurrence; Category B_ Multiple times; Category C Other aggravating factors (in no particular order): (1) Age at time of molestation; (2) Ifthe perpetrator was a priest; (3) Location of ilegal acts (i.e, church property); (4) Provided alcohol; (8) Exposure to pomography; (6) Need for psychological counseling, LEVEL =. — ORALSEX Category A One time occurrence Category BB Multiple times; Category C Other aggravating factors (in no particular order): (1) Age at time of molestation; (Q) If the perpetrator was n priest; G) Location of illegal acts (e., chuech property); @) Provided alcohol; (5) Exposure to pornography; (©) Need for psychological counseling,MEVELIV - Category A Category B Category C SODOMY/INTERCOURSE One time occurrence; ‘Multiple occurrences; Other aggravating factors (in no particular order): w 2) @) @ (3) © Age at time of molestation; Ifthe perpetrator Was a priest; Location of ilegal acts (i.e., church property); Provided alcohol; Exposure to pomography; ‘Need for psychological counseling.