Revised Director Retirement Benefits

DOWNEY FINANCIAL CORP.


RESOLUTION DFC016-2004a


DIRECTOR RETIREMENT BENEFITS PLAN


This Director Retirement Benefits Plan ("Plan") describes the Plan as approved by the Board of Directors of Downey Financial Corp. ("DFC") and Downey Savings and Loan Association, F.A. ("Downey Savings", and with DFC, collectively "Downey") on May 28, 2003 and revised as of April 28, 2004.

1. To be eligible to receive any benefits under the Plan, the Director must have (i) retired as a Director of Downey; (ii) not been a Downey employee while serving on the Boards; and either (iii) served as a Downey Director for at least three years if the Director joined the Boards before April 23, 2003; or (iv) served as a Downey Director for at least five years if the Director joined the Boards on or after April 23, 2003.

2. Each eligible Director, or the Director' s designated beneficiary, shall receive from Downey the Total Benefit as calculated under paragraph 3 below, in 60 equal monthly payments, without interest, beginning the month after the month the Director retires from the Boards. The eligible retiring Director or the Director' s beneficiary may request a single, lump sum payment of the Total Benefit (in lieu of receiving payments over 60 months). The Boards may approve or deny this request ...