SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANGELES, CENTRAL DISTRICT SPRING STREET COURTHOUSE

Transcription

1 HEATHER DAVIS, SBN AMIR NAYEBDADASH, SBN PROTECTION LAW GROUP, LLP Main Street, Suite A El Segundo, CA 0 Telephone: () 0-0 Facsimile: () -0 Attorneys for Plaintiffs RICHARD RAMMER and ROBERT KINSCH SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANGELES, CENTRAL DISTRICT SPRING STREET COURTHOUSE 1 1 BAMBI HOLZER, RICHARD RAMMER, and ROBERT KINSCH on behalf of themselves and all others similarly situated, vs. Plaintiff, WEDBUSH SECURITIES INC., a California corporation, and DOES 1 through 0, inclusive, Defendants. Case No. BC0 Hon. Elihu M. Berle Dept. JOINT STIPULATION OF CLASS ACTION SETTLEMENT Complaint Filed: July 1, Trial Date: December, 1

2 1 1 This Joint Stipulation of Class Action Settlement ( Joint Stipulation, Settlement, or Settlement Agreement ) is made and entered into by and between, on the one hand, (i) Plaintiff Richard Rammer and Robert Kinsch ( Plaintiffs ), and, on the other hand, (ii) Defendant Wedbush Securities Inc. ( Defendant ). (Defendant and Plaintiffs are sometimes referred to collectively herein as the Parties. ) Subject to the approval of the Court, the above-referenced action is being compromised and settled under the terms and conditions set forth herein. Upon execution, and subject to the approval of the Court as provided below, this Settlement Agreement shall be binding on Plaintiffs, the Class Members, PAGA Class Members, the State of California, and Defendant, subject to the terms and conditions hereof. I. DEFINITIONS To the extent terms or phrases used in this Settlement Agreement are not specifically defined below, but are defined elsewhere in this Settlement Agreement, they are incorporated herein by reference. A. Action or Lawsuit means the action entitled Holzer et al. v. Wedbush Securities, Inc., Los Angeles Superior Court Case No. BC0. B. Class or Class Members means all persons who performed work for Defendant in the State of California in the position of financial advisor and were classified as independent contractors during all or part of the the Class Period and who did not previously opt-out of the Class. C. Class Counsel means Protection Law Group LLP. D. Class Period means the period of time from July 1, through Preliminary Approval. E. Class Representatives means Plaintiffs Robert Kinsch and Richard Rammer. F. Defendant means Wedbush Securities, Inc. G. Effective Date means the date by which the Court s order granting final approval of this Joint Stipulation becomes final. Such order becomes final upon the later of: (a) final

3 1 1 approval is granted, judgment is entered and Class Counsel and Plaintiffs waive their right to appeal in writing if no objections are filed; or (b) if an objection is filed, if no appeal is filed, the last date by which an appeal can be filed from the date of the entry of final approval and judgment; or (c) if objection is filed and an appeal of the final judgment is filed and there is a final disposition by ruling, dismissal, denial, or otherwise by the Court of Appeal, and review of the Court of Appeal s decision is requested, the day after the request for review is denied with prejudice and/or no further review of the judgment can be requested. H. Final Approval means the date upon which the Court enters an order granting final approval of this Joint Stipulation, after having determined that the Settlement is fair, adequate, and reasonable to the Class, following notice to the Class and a hearing on the fairness of the Settlement. I. Final Approval Hearing means the final hearing held to ascertain the fairness, reasonableness, and adequacy of the Joint Stipulation, at which time the Court will enter its order granting final approval of the Joint Stipulation. J. Gross Settlement Amount means the amount of One Million dollars ($1,000,000.00) that Defendant will pay to resolve this Action. K. LWDA means the California Labor and Workforce Development Agency. L. Net Settlement Amount means the Gross Settlement Amount less the Settlement Administration Costs, payments for Class Counsel s attorneys fees and litigation costs, incentive payments to Plaintiffs, and PAGA Penalties. M. Notice Packet has the meaning set forth in Section III. C. of this Joint Stipulation. N. PAGA means the California Labor Code Private Attorneys General Act of 0, codified in California Labor Code, et seq. O. PAGA Period means the period beginning May 1, through Preliminary Approval. P. PAGA Representative means Plaintiff Robert Kinsch. Q. PAGA Class Members means all Class Members who were associated with

4 1 1 Defendant during the PAGA Period. R. Preliminary Approval means the court order preliminarily approving this Joint Stipulation. S. Preliminary Approval Hearing means the hearing held on the Motion for Preliminary Approval of the Joint Stipulation. T. Released Claims means any and all claims for wages, damages, unpaid costs, penalties, liquidated damages, benefits, fringes, interest, attorney fees, litigation costs, restitution, or equitable relief, which Plaintiffs and Settlement Class Member had, or may claim to have, against any of the Released Parties, arising out of the facts, circumstances, and primary rights during the Class Period alleged in the FAC, including (a) misclassification (b) all claims for failure to pay wages, including overtime wages and minimum wages; (c) all claims for failure to provide meal and/or rest periods, and associated premium payments; (d) all claims for failing to pay wages timely during employment and upon termination, and associated claims for waiting time penalties; (e) all claims for recordkeeping or wage statement violations; (f) all claims for failure to reimburse business expenses; (g) any claim for violation of California Business and Professions Code 0, et seq., arising from the above-referenced claims and those claims set forth in the FAC; and (h) all claims for penalties under PAGA. U. Released Parties means Defendant and all of its officers, directors, shareholders, investors, employees, agents, insurers, parent company, affiliates, subsidiaries, successors, assigns, and any individual or entity that could be jointly liable with Defendant. V. Response Deadline means the date that is sixty (0) calendar days after the date the Notice Packet is mailed to the Class Members, which will be the deadline for Class Members to submit Workweeks Disputes or objections to the Settlement. W. Settlement Administrator means ILYM Group, Inc. X. Settlement Administration Costs means all fees, costs and expenses relating to the administration of the settlement in this Action, including without limitation, printing and mailing the Notice Packet, calculating and determining Individual Settlement Payments and

5 1 1 Individual PAGA Payments for Class Members, regularly updating counsel on the status of administration, and the accounting and maintenance of the Settlement Fund Account. Y. Settlement Fund Account means the bank account established under this Joint Stipulation from which all monies payable under this Joint Stipulation will be paid, as set forth herein. Z. Workweeks means, (i) with respect to Class Members, the total number of weeks worked by Class Members during the Class Period according to Defendant s records, with any partial weeks rounded up to the nearest full week, and (ii) with respect to PAGA Class Members, the total number of weeks worked by PAGA Class Members during the PAGA Period according to Defendant s records, with any partial weeks rounded up to the nearest full week. II. PRE-TRIAL PROCEEDINGS AND NEGOTIATIONS A. Discovery, Investigation and Research. The parties engaged in extensive investigation of the facts and law during the prosecution of the Action. The investigation included the exchange of information through informal discovery. Specifically, it included, among other things, the exchange of Defendant s employment policies, practices, and procedures applicable to Plaintiffs allegations, and a sampling of Class Members time and pay records. The parties also prepared for and attended three separate mediations and, most recently, a full-day mediation with the Hon. William Pate, a well-regarded mediator. Counsel for the parties also investigated applicable law as applied to the facts in the case, potential defenses thereto, and damages claimed by Plaintiffs on behalf of themselves and the Class. The parties conducted their own evaluations of the potential recoveries based on the claims alleged in the Action. B. Allegations of Plaintiffs and Benefits of Settlement. 1. This Settlement Agreement was reached after arm s-length bargaining between the parties with the assistance of an experienced mediator, and after Class Counsel thoroughly reviewed all available evidence. The information exchanged between the parties allowed them to assess the merits and to compromise the issues on a fair and equitable basis.. Plaintiffs and Class Counsel contend the claims asserted in the Action have merit.

6 1 1 But, they acknowledge the expense and delay of continued litigation to prosecute the Action through trial and appeal. Class Counsel has considered the uncertain outcome and risk of litigation, and the difficulties and delays inherent in such litigation. It has also considered the risks associated with class certification, trial, and/or appeals. Class Counsel determined this Settlement Agreement confers substantial benefit to the Class and an independent review by the Court will confirm this conclusion. Class Counsel has determined that this Settlement Agreement is in the best interests of Plaintiffs and Class Members. C. Defendant's Denials of Wrongdoing and Benefits of Settlement. 1. Defendant denies generally all claims alleged in the Action and further denies class or representative treatment is appropriate for any purpose other than this settlement. Defendant contends it complied with California and other applicable law. It is Defendant's position that, if litigation continued, class certification would be denied on all claims, and any representative claims would be determined to be unmanageable at trial. Defendant contends that none of Plaintiffs are adequate class representatives; their claims are not typical of the Class Members; and individual issues predominate over common ones. Defendant further contends that this action may be adjudicated on a summary basis and had a summary judgment motion pending.. Defendant concluded further litigation of the Action would be protracted and expensive. Defendant further determined it is desirable that the Action be fully and finally settled in the manner and upon the terms and conditions in this Settlement Agreement. D. Intent of the Settlement. By this Settlement Agreement, the Parties intend to achieve the following: (1) entry of an order approving the Settlement Agreement and granting the relief set forth herein; () entry of judgment in accordance with California Rule of Court.(h); and () discharge of Released Parties from liability for all Released Claims. III. PROCEDURAL ISSUES A. Preliminary Approval. Class Counsel will submit this Joint Stipulation to the Court with a Motion for Preliminary Approval of this Settlement. Defendant will not oppose the motion. Class Counsel will also comply with the requirements for approval of PAGA settlements,

7 1 1 as set forth in California Labor Code section (l). B. Settlement Administrator. 1. The third-party company known as ILYM Group, Inc. will act as Settlement Administrator. The Settlement Administrator will be responsible for (1) preparing, printing and mailing simultaneously the Class Notice in substantially the same form as attached Exhibit A ; () receiving and reviewing objections to the proposed settlement; () calculating payments under the Settlement; () handling inquiries from Class Members concerning the Notice Packet, including attempting to resolve disputes concerning Workweeks; () providing weekly status reports to Defendant s counsel and Class Counsel regarding the mailings, objections, and estimated Individual Settlement Payments and Individual PAGA Payments; () distributing Individual Settlement Payments and Individual PAGA Payments to Class Members, as well as payments to taxing authorities as appropriate; () providing due diligence declarations for submission to the Court, as needed; () printing and providing Class Members and Plaintiffs with tax forms as required under this Settlement Agreement and applicable law, and providing copies of same to Defendant; and () such other tasks as the parties mutually agree or the Court orders the Settlement Administrator to perform. The Settlement Administrator will perform a skip-trace search and r all returned, undelivered mail within seven () calendar days of receiving notice that the mailing was undeliverable.. The Settlement Administrator will also handle payment to the LWDA of its share of the PAGA Penalties, payment of Class Counsel s attorney s fees and costs that are approved by the Court, and payment to Plaintiffs for their incentive payments.. The Parties each represent they do not have a financial interest in the Settlement Administrator or otherwise have a relationship with the Settlement Administrator that creates or could create a conflict of interest. Settlement Administration Costs are estimated not to exceed $,00 and are to be paid from the Gross Settlement Amount. C. Notice to Class Members. Notice shall be provided to Class Members in the

8 1 1 following manner: 1. Within fifteen () calendar days of Preliminary Approval, Defendant will provide the Settlement Administrator with the following information for each Class Member: (1) name; () last known mailing address and telephone number; () social security number; () dates of employment; and () Workweeks (the Class List ).. Within seven () calendar days after the Settlement Administrator s receipt of the Class List, the Settlement Administrator will mail the Notice Packet to the Class Members via first-class regular U.S. mail.. Prior to mailing, the Settlement Administrator will perform a search based on the National Change of Address Database information to update and correct for any known or identifiable address changes. It will be conclusively presumed that if the Notice Packet has not been returned within thirty (0) calendar days of mailing that the Class Member received the Notice Packet and all of its contents. If a new address is obtained after a Notice Packet is returned as undeliverable, the Settlement Administrator shall promptly forward the original Notice Packet to the updated address via first-class regular U.S. mail, indicating on the original packet the date of such r ing.. A returned Notice Packet will be forwarded only once by the Settlement Administrator. Upon completion of these steps by the Settlement Administrator, Defendant shall be deemed to have satisfied its obligation to provide notice of the class settlement to Class Members. Such persons shall be bound by all terms of the Settlement Agreement (including the release) and the Court's order and final judgment. D. Procedure to Object to Settlement. 1. Any Class Member who seeks to object to the Settlement may do so by filing his or her objection with the Court and serving a copy of the objection on the Settlement Administrator by mail at P.O. Box 1 Tustin, CA 1. All objections must be served no later than the Response Deadline. The date of the postmark on the objection shall be the exclusive means used to determine whether a Class Member has timely served his or her objection on the Settlement

9 1 1 Administrator. Within three () business days of receiving any objection to the Settlement, the Settlement Administrator shall provide copies of such objections to Class Counsel and counsel for Defendant. The objection must state the specific reason for the objection including any legal support, as well as the class member s full name.. Class Members may also attend and make objections in person at the Final Approval Hearing. E. Workweeks Dispute. A Class Member may dispute the accuracy of the Workweeks credited to him or her in conformity with the instructions in the Class Notice ( Workweeks Dispute ). Any such Workweeks Dispute must be mailed to the Settlement Administrator by the Class Member, postmarked on or before the Response Deadline, and must include any records or documentation to support the Workweeks Dispute. The Settlement Administrator shall provide copies of all Workweek Disputes to Class Counsel and Counsel for Defendant within three () business days of receipt, and shall immediately attempt to resolve all such disputes with the assistance of Defendant s counsel and Class Counsel. If the Workweek Dispute cannot be resolved in that manner, the Workweek Dispute shall be presented to the Court and the Court shall determine the dispute at the Final Approval Hearing. F. Request for Judgment. At the Final Approval Hearing, Class Counsel will move the Court for entry of judgment incorporating the Settlement Agreement in accordance with the California Rule of Court.(h). Class Counsel will seek approval of the Settlement as being fair, reasonable and adequate to the Class Members within the meaning of California Code of Civil Procedure and.. Class Counsel and Defendant s counsel will submit to the Court such pleading and/or evidence as required for the Court s determination. Class Counsel will submit a fee and cost application as part of the motion for final approval to be determined at the Final Approval Hearing. IV. SETTLEMENT TERMS A. Gross Settlement Amount. 1. To settle the Action and the Released Claims, Defendant will pay the Gross

10 1 1 Settlement Amount as set forth above. Defendant will not be required to contribute additional sums to fund the Settlement or otherwise resolve this Action and the Released Claims. The Gross Settlement Amount is non-reversionary and distribution will be on a non-claims-made basis.. Defendant will deposit the Gross Settlement funds with ILYM within fifteen () business days of the Effective Date.. As consideration for the Gross Settlement Amount, Plaintiffs agree to the terms and conditions set forth in this Settlement Agreement. B. Establishment of Settlement Fund. Within seven () calendar days of Preliminary Approval, the Settlement Administrator will establish a Settlement Fund Account in a non-interest bearing transaction account at a FDIC-insured institution designated by Defendant with at least one branch in California. Once the Settlement Fund Account is established, Defendant will make appropriate arrangements to fund the account as required by this Settlement Agreement. C. Allocation of Settlement Proceeds. The Gross Settlement Amount is inclusive of and will be allocated as follows: 1. Class Counsel s attorneys fees, as approved by the Court, in an amount not to exceed % of the Gross Settlement Amount, or $0,000. The fees sought by Plaintiffs counsel shall be detailed in the motion for final approval. An award by the Court of attorney s fees less than the amount applied for will not be grounds for Plaintiffs or Class Counsel to challenge or withdraw from the Settlement;. Class Counsel s costs and expenses, as approved by the Court, in an amount not to exceed $0,000. The costs shall be detailed in Class Counsel s application for fees and costs in this Action, to be heard at the time of Final Approval. An award by the Court of costs less than the amount applied for will not be grounds for Plaintiffs or Class Counsel to challenge or withdraw from the Settlement, or to appeal from a judgment or award of costs and expenses entered by the Court in this Action;. Incentive payments to Plaintiffs, as approved by the Court, for their service on behalf of the Class, in an amount not to exceed $,000 for Plaintiff Richard Rammer, and $,000

11 1 1 for proposed Plaintiff Robert Kinsch. An award by the Court of incentive payments to the Plaintiffs less than the amount applied for will not be grounds for Plaintiffs or Class Counsel to challenge or withdraw from the Settlement, or to appeal from a judgment or award of incentive payments entered by the Court in this Action;. The Settlement Administration Costs, as approved by the Court, in an amount estimated not to exceed $,00;. The amount of $,000 for penalties pursuant to PAGA ( PAGA Penalties ); and. The Net Settlement Amount, which is available for distribution to Class Members, after deducting the above amounts. D. Distribution of Settlement Proceeds. 1. The Settlement Administrator shall keep Defendant s Counsel and Class Counsel apprised of all distributions from the settlement fund. No person shall have any claim against Defendant, Defendant s Counsel, Plaintiffs, Class Counsel, or the Settlement Administrator based on distributions and payments made in accordance with this Settlement Agreement.. Distribution of the Gross Settlement Amount shall be as follows: a. Initial Payment: Within fifteen () business days after the Effective Date, the Settlement Administrator shall pay all Individual Settlement Payments to Class Members and Individual PAGA Payments to PAGA Class Members, Class Counsel s fees and costs, Plaintiffs incentive award, payment to the LWDA for its share of the PAGA Penalties, and the remaining balance of the Settlement Administration Costs, if any, all as determined by the Court at the Final Approval Hearing. b. Payout to Class Members: i. Individual Settlement Payments: The Settlement Administrator will be responsible for calculating each Settlement Class Member s share of the Net Settlement Amount ( Individual Settlement Payment ), as follows: The Net Settlement Amount will be divided by the total number of Workweeks

12 1 1 worked by all of the Class Members to yield a Class Weekly Rate. Each Settlement Class Member s respective number of Workweeks will be multiplied by the Class Weekly Rate, to yield his or her respective Initial Share. The Net Settlement Amount will be fully-distributed without reversion to Defendant, in accordance with this Settlement Agreement. ii. Individual PAGA Payments: The Settlement Administrator will be responsible for calculating each PAGA Settlement Class Member s share of the PAGA Penalties ( Individual PAGA Payment ), as follows: The PAGA Penalties amount of $,000 will be multiplied by. (to yield the % portion that will be distributed to PAGA Class Members) and divided by the total number of Workweeks worked by all of the PAGA Class Members during the PAGA Period to yield the PAGA Weekly Rate. Each PAGA Settlement Class Member s Workweeks will be multiplied by the PAGA Weekly Rate to yield his or her respective Individual PAGA Payment. The PAGA Penalties will be fully-distributed without reversion to Defendant, in accordance with this Settlement Agreement.. Each Settlement Class Member s Individual Settlement Payment and Individual PAGA Payment may be paid by way of a single check that combines both payments and will be reported on IRS Form. One hundred percent (0%) of each Individual PAGA Payment will be considered penalties. The Settlement Administrator will issue the appropriate federal and state tax forms.. The Settlement Administrator s determination of eligibility for, and the amounts of, any settlement payments under this Settlement Agreement shall be conclusive, final, and binding on all parties, including all Class Members. Any settlement checks paid to Class Members will remain valid and negotiable for one hundred eighty (0) calendar days from the date of their issuance after which they will become stale ( Check Stale Date ) and shall automatically be cancelled if not cashed or deposited by Class Members within that time. Any funds remaining in

13 1 1 the Settlement Fund Account as a result of Class Members failure to cash or deposit their checks by the Check Stale Date shall be transmitted to the California Department of Industrial Relations Unpaid Wages Fund and held in trust for such Class Members. The Settlement Administrator shall also undertake amended and/or supplemental tax filings and reporting, required under applicable local, state, and federal tax laws, that are necessitated due to the cancellation of any settlement checks. To the extent that the Settlement Administrator is able to obtain or receive the return or refund of the amounts that were transmitted to taxing authorities for the employer s and employee s share of payroll taxes and withholding associated with cancelled Individual Settlement Payments, these amounts shall be transmitted to the California Department of Industrial Relations Unpaid Wages Fund and held in trust for such Class Members.. Class Members will be solely responsible for the reporting and payment of any state, local and/or federal income tax, if any, on the amount paid to them under the Settlement. If it is determined that any taxes are due in connection with any amount paid under the Settlement, Class Members will be solely responsible for all liability for taxes and any costs, fees, interest, assessments, penalties, damages, or other losses due to such a determination. No payments made under this Settlement Agreement will have an effect on any employee pension benefit plan or employee welfare benefit plan sponsored by Defendant. E. Class Counsel s Attorney s Fees. Defendant will not oppose Class Counsel s application for fees of up to % ($0,000) of the Gross Settlement Amount. Defendant will not be obligated to pay any attorney s fees of Class Counsel, Plaintiffs, or Class Members above this amount. Class Counsel s fee application shall be submitted with supporting documentation, and heard at the time of the Final Approval Hearing. No part of the Gross Settlement Amount will be used to pay any attorney s fees of Class Counsel, Plaintiffs or Class Members above this amount. Class Counsel s fees are subject to court approval. F. Class Counsel s Costs. Defendant will not oppose Class Counsel s application for reimbursement of litigation costs and expenses of up to $0,000. Defendant will not be obligated to pay any costs of Class Counsel, Plaintiffs or Class Members above this amount. No part of the

14 1 1 Gross Settlement Amount will be used to pay any costs of Class Counsel, Plaintiffs or Class Members above this amount. Class Counsel s request for costs must be submitted with its fee application and heard at the time of the Final Approval Hearing. Class Counsel s costs are subject to court approval. G. Incentive Payments to Plaintiffs. Defendant will not oppose Class Counsel s application for incentive payments to Plaintiffs of up to $,000 to Plaintiff Robert Kinsch, and $,000 to Plaintiff Richard Rammer. These incentive payments are subject to court approval. Defendant will not be obligated to pay any incentive payments above these amounts. These payments shall be considered miscellaneous income. The Settlement Administrator will be responsible for issuing a Form, and any other tax forms, to Plaintiffs relating to these payments. No part of the Gross Settlement Amount will be used to pay any incentive payments above these amounts. H. Settlement Administration Costs. The parties agree the Settlement Administration Costs shall be deducted from the Gross Settlement Amount, subject to court approval. Settlement Administration Costs are estimated not to exceed $,00. I. PAGA Penalties. The parties agree to allocate $,000 of the Gross Settlement Amount to the resolution of all claims for penalties under PAGA. Pursuant to California Labor Code (i), seventy-five percent (%) of that amount ($,0) will be paid to the LWDA. The remaining twenty-five percent (%) ($,0) will be distributed to PAGA Class Members, as set forth herein. J. Declaration of Compliance. Not more than 1 days after the Check Stale Date, the Settlement Administrator will provide a declaration, in a form acceptable to Class Counsel and Defendant's counsel, confirming (i) its compliance with its duties as Settlement Administrator, as set forth in this Agreement, (ii) the payment of each of items set forth in section IV.D-IV.I of this Agreement, and (iii) any amounts transferred to the California Department of Industrial Relations- Unclaimed Wage Fund and the number of Class Members on whose behalf those amounts were transferred.

15 1 1 K. Release of Claims by Plaintiffs and Class. 1. Upon the Effective Date, Plaintiffs and Class Members will be deemed to have released the Released Parties of and from all of the Released Claims during the Class Period. In connection with this release, each and every Class Member will be deemed also to have acknowledged and agreed that California Labor Code Section. is not applicable to the Parties hereto, or to the Class Members, because there is a good faith dispute as to whether any wages are due to all or any Class Member. California Labor Code Section. provides in pertinent part as follows: AN EMPLOYER SHALL NOT REQUIRE THE EXECUTION OF A RELEASE OF A CLAIM OR RIGHT ON ACCOUNT OF WAGES DUE, OR TO BECOME DUE, OR MADE AS AN ADVANCE ON WAGES TO BE EARNED, UNLESS PAYMENT OF THOSE WAGES HAS BEEN MADE.. In addition, upon the Effective Date, each of Plaintiffs will be deemed to have released the Released Parties of and from all claims arising from his employment with Defendant, separation of employment from Defendant, and any acts that have or could have been asserted in any legal action or proceeding against Defendant, whether known or unknown, arising under any federal, state or local law or statute, including, inter alia, those arising under the California Labor Code, Fair Labor Standards Act, Americans with Disabilities Act, Title VII of the Civil Rights Act of 1, Employee Retirement Income Security Act, National Labor Relations Act, California Corporations Code, California Business and Professions Code, California Fair Employment and Housing Act, California Constitution (all as amended), and law of contract and tort, as well as for discrimination, harassment, retaliation, wrongful termination, lost wages, benefits, other employment compensation, emotional distress, medical expenses, other economic and noneconomic damages, attorney fees, and costs.. With respect to those claims released, each of Plaintiffs acknowledge and waive all rights under Civil Code, which provides: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE

16 1 1 CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.. Upon the Effective Date, each of Plaintiffs will be deemed to have waived his or her rights under Civil Code, for those claims listed above.. Upon the Effective Date, all PAGA Class Members shall be deemed to have, and by operation of the Judgment shall have, expressly released the Released Parties from any claim for penalties pursuant to California Labor Code and/or et seq., alleged in the FAC, arising out of the facts alleged in the FAC, or that could have been alleged based on the same nucleus of operative fact, including any claim to collect such penalties on behalf of the State of California on behalf of the Class Member or any other Class Member.. Upon the Effective Date, the California Labor Workforce and Development Agency, California Labor Commissioner and any state agency with authority to collect penalties for violations of the California Labor Code shall be deemed to have, and by operation of the Judgment shall have, expressly released the Released Parties from any claim for penalties for violation of the California Labor Code alleged in the FAC, arising out of the facts alleged in the FAC, or that could have been alleged based on the same nucleus of operative fact, including any claim to collect unpaid wages owed to any Class Member pursuant to California Labor Code. V. NULLIFICATION OF THE JOINT STIPULATION A. If (a) the Court should for any reason not approve this Settlement Agreement in the form agreed to by the parties, or (b) the Court should for any reason not enter a judgment in the Action, (c) the judgment is reversed, modified, or declared or rendered void, or (d) the Effective Date does not occur for any other reason, this Settlement Agreement will be null and void, and neither this Settlement Agreement, nor any of the related negotiations or proceedings, will be of any force or effect, and all parties will stand in the same position, without prejudice, as if the Settlement Agreement had not been entered or filed. Invalidation of any material portion of this Settlement Agreement will invalidate this Settlement Agreement in its entirety, unless the parties

17 1 1 subsequently agree in writing the remaining provisions of the Joint Stipulation are to remain in full force and effect. B. Defendant has represented there were 1 Class Members as of July 1,. If the actual number of Class Members as of that date exceeds, Plaintiffs may rescind this Joint Stipulation. If Plaintiffs rescind the Settlement in conformity with this section, they will be responsible for the Settlement Administration Costs incurred up to the date of rescission. This option to rescind the Settlement must be exercised by Plaintiffs jointly, by way of written notice sent to Defendant s Counsel by certified mail to William Turner, Jones, Bell, Abbott, Fleming and Fitzgerald, LLP, 01 South Figueroa Street, Suite 0, Los Angeles, California 00, within ten () calendar days of Class Counsel s receipt of written confirmation from the Settlement Administrator that the Class Members exceed. VI. DUTIES OF THE PARTIES A. Mutual Cooperation. The parties agree to cooperate to accomplish and implement the terms of this Joint Stipulation. Such cooperation will include, but not be limited to, execution of such other documents and taking such other actions as may reasonably be necessary to fulfill the terms of this Settlement Agreement. The parties will use their reasonable best efforts, including all efforts contemplated by this Settlement Agreement and any other efforts that may become necessary by court order, or otherwise, to effectuate this Settlement Agreement and the terms set forth herein. As soon as practicable after execution of this Settlement Agreement, Class Counsel, with the cooperation of Defendant and its counsel, will try to secure Preliminary Approval and Final Approval. B. Duty to Support and Defend the Settlement. The parties agree the Settlement is fair and reasonable and will so represent to the Court. In addition, the mediator, the Hon. William Pate may execute a declaration supporting the settlement, and the Court may contact the mediator to discuss the settlement and whether or not the settlement is fair and reasonable. The parties agree to abide by all terms of the Joint Stipulation in good faith and to support the Settlement Agreement fully, and to use their best efforts to defend this settlement from any legal challenge, whether by

18 appeal or collateral attack. VII. MISCELLANEOUS PROVISIONS 1 1 A. No Media Comments. The Parties and Class counsel agree that they will not issue any press releases or press statements, post any Internet disclosures, have any communications with the press or media about the Lawsuit or the Settlement, or otherwise discuss the Lawsuit or Settlement with any person, except that: (a) Class Counsel shall be allowed to refer to the Settlement in support of other court filings in other litigation; (b) the Parties shall have the right to disclose the Settlement as may be required under federal or state tax and/or securities laws or under Generally Accepted Accounting Principles; (c) the Parties shall have the right to disclose the Settlement to third parties without identifying the case name, case number, or names of any of the Parties or Released Entities; (d) the Parties may refer to the Settlement, describe its terms, and file the settlement agreement with the Court in connection with any proceedings which are reasonably necessary to obtain Court approval of the Settlement, and (e) except for the previously listed exceptions, in response to any inquiries, the Parties may state that the matter has been resolved. B. No Admission of Liability. This Settlement Agreement is not an admission of liability by Defendant or any of the Released Parties. C. Non-Disparagement. Plaintiffs and Class Counsel agree not to publicly disparage Defendant or any of the Released Parties. D. Construction. The parties agree this Settlement Agreement resulted from lengthy, intensive, arm s-length negotiations, and it is not to be construed for or against any party for any reason. E. Choice of Law. This Settlement Agreement is intended to and will be governed by the laws of California, without regard to conflicts of law principles. The Court will retain continuing jurisdiction to enforce the Settlement. F. Captions and Interpretations. Paragraph, titles, or captions contained herein are inserted as a matter of convenience and for reference only, and in no way define, limit, extend, or describe the scope of this Joint Stipulation or any provision thereof.

19 1 1 G. Modification. This Joint Stipulation may not be changed, altered, or modified, except in writing signed by counsel for the parties and approved by the Court. H. Integration Clause. All prior or contemporaneous agreements, understandings, representations, and statements, whether oral or written, between the parties are merged herein. No rights under this Joint Stipulation may be waived except in writing. I. Entire Agreement. The Exhibits to this Agreement are integral parts of this Agreement and are hereby incorporated and made a part of the Agreement. This Agreement contains the entire agreement between the Parties and constitutes the complete, final and exclusive embodiment of their agreement with respect to the subject matter hereof. This Agreement supersedes and replaces for all purposes that certain Class Action Settlement Agreement and Release previously entered into by the Parties. This Agreement is executed without reliance upon any promise, representation or warranty by either Party other than those expressly set forth herein. Any inconsistency between this Agreement and the attached Exhibits will be resolved in favor of this Agreement. J. No Construction Against Drafter. This Agreement shall be deemed to have been drafted jointly by the Parties, and any rule that a document shall be interpreted against the drafter shall not apply to this Agreement. K. Successors and Assigns. This Joint Stipulation will be binding upon and inure to the benefit of the parties and their respective heirs, trustees, executors, administrators, predecessors, successors, affiliates, agents, and assigns. L. Execution in Counterparts. This Joint Stipulation will become effective upon its execution by all of the undersigned. The parties may execute this Joint Stipulation in counterparts, and execution of counterparts will have the same force and effect as had all parties signed the same instrument. Facsimile or pdf copies of any such signed counterparts may be used in lieu of the original for any purpose. Pursuant to California Civil Code section., the parties agree they may use DocuSign or similar electronic signature technology to expedite the execution of this Settlement Agreement. 1

20 1 1 M. Notices. The Parties, Class Counsel and Counsel for Defendant acknowledge and agree that for the purposes of any claims, actions or proceedings arising out of this Joint Stipulation, notice provided to Class Counsel shall be deemed notice to Plaintiffs and to Class Members. All notices, requests, demands and other communications required to be given under this Joint Stipulation shall be in writing and shall be delivered personally, faxed, ed or mailed, postage prepaid, by first class United States mail, addressed as follows: To Class Members or to Plaintiffs: Amir Nayebdadash (SBN ) Heather Davis (SBN ) PROTECTION LAW GROUP LLP Main Street, Suite A El Segundo, California 0 Telephone:.0.0 Facsimile:..0 To Defendant: William Turner (SBN 1) Jones, Bell, Abbott, Fleming and Fitzgerald, LLP 01 South Figueroa Street, Suite 0 Los Angeles, California 00 Telephone:.. N. Jurisdiction of the Court. Any dispute regarding the interpretation or validity or otherwise arising out of this Agreement, or relating to the Action or the Released Claims, shall be subject to the exclusive jurisdiction of the Court, and the Plaintiffs, Class Members and Defendant agree to submit to the personal and exclusive jurisdiction of the Court for the purpose of resolving any such dispute. Following the Effective Date, the Court shall retain jurisdiction solely with respect to the interpretation, implementation and enforcement of the terms of this Agreement and all orders and judgments entered in connection therewith, and the Parties and their counsel submit to the jurisdiction of the Court for purposes of interpreting, implementing and enforcing the Settlement embodied in this Agreement and all orders and judgments entered in connection therewith.

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24 EXHIBIT A

25 NOTICE OF PROPOSED CLASS ACTION SETTLEMENT Holzer v. Wedbush Securities Inc. Los Angeles Superior Court, Case No. BC0 THIS IS A COURT-AUTHORIZED NOTICE. IT IS NOT A SOLICITATION. PLEASE READ THIS NOTICE CAREFULLY. YOUR LEGAL RIGHTS ARE AFFECTED WHETHER YOU ACT OR DO NOT ACT. To: All current and former individuals who performed work as financial advisors for Wedbush Securities, Inc. and were classified as independent contractors between July 1, and [Date of Preliminary Approval]. BASIC INFORMATION 1. What is this settlement about? On July 1,, a lawsuit was commenced against Defendant Wedbush Securities Inc. by a former financial advisor. The case is currently pending in the Los Angeles County Superior Court, Case No. BC0. The lawsuit claims that Wedbush misclassified its financial advisors as independent contractors when all financial advisors should have been classified as employees. The lawsuit seeks penalties associated with this misclassification. as well as reimbursement for unpaid wages, unlawful deductions and unpaid business expenses. The lawsuit also seeks penalties and relief for failing to provide accurate wage statements, unfair business practices, and penalties under the Private Attorney General s Act. Defendant denies all alleged violations and deny that it owes Class Members any remedies. The Court has not made a ruling on the merits of the case.. Why is this a class action? In a class action, one or more people called Class Representatives (in this case Richard Rammer and Robert Kinsch, also known as Plaintiffs ), sue on behalf of people who appear to have similar claims (in this case all persons who performed work for Defendant in the State of California in the position of financial advisor and were classified as independent contractors at any time from July 1, through [Date of Preliminary Approval]). All these people are referred to here as Class Members. One court resolves the issues for all Class Members in one lawsuit, except for those who exclude themselves from the Class. The Los Angeles Superior Court is in charge of this class action. On November,, the Los Angeles Superior Court certified this class. In January, you were sent a letter advising that if you did not send back a letter declining to participate in the class action, you would be part of the class. If you are receiving this notice, you are part of this class.. Why is there a settlement? The Court has not decided in favor of the Plaintiffs, the Class, or Defendant. There has been no finding of any wrongdoing by Defendant. Instead, both sides agreed to a settlement which is memorialized in the Joint Stipulation of Class Action Settlement ( Settlement Agreement or Settlement ). SAN_FRANCISCO/#.1

26 On [Date of Preliminary Approval] the Court granted preliminary approval of the Settlement. This Settlement was agreed to between Defendant Wedbush Securities Inc., Class Representatives Richard Rammer and Robert Kinsch, and Class Counsel Protection Law Group, LLP The Class Representatives and Class Counsel think the Settlement is best for the Class.. How do I know if I am part of the settlement? WHO IS IN THE SETTLEMENT? If you are receiving this Notice you are a part of the Settlement and a Class Member, because you performed work for Defendant as a financial advisor and were classified as an independent contractor between May, and [Date of Preliminary Approval]. You should have previously received a letter informing you that the class had been certified.. What does the settlement provide? THE SETTLEMENT BENEFITS WHAT YOU GET The Settlement provides that Defendant will have to pay a maximum of One Million Dollars and Zero Cents ($1,000,000.00) ( Gross Settlement Amount ). Net Settlement Amount: the portion of the Gross Settlement Amount that will be available for distribution to Class Members ( Class Members ), is the Gross Settlement Amount less the following amounts (which are subject to Court approval): A. Attorneys Fees to Class Counsel not to exceed % of the Gross Settlement Amount or Three Hundred and Fifty Thousand Dollars and Zero Cents ($0,000.00); B. Litigation Costs/Expenses to Class Counsel not to exceed Fifty Thousand Dollars and Zero Cents ($0,000.00); C. Enhancement Payments to the Class Representatives in an amount not to exceed Fifteen Thousand Dollars and Zero Cents ($,000.00) to both Richard Rammer and Robert Kinsch ($0, total); D. Settlement Administration Costs which are currently estimated to be $,00; and E. Payment to the Labor and Workforce Development Agency in the amount of $,0 for penalties pursuant to the Private Attorney General Act (PAGA Payment). The amount of money remaining after these payments, the Net Settlement Amount, is the amount that will be distributed to Class Members if the Settlement is granted final approval by the Court. The portion of the Net Settlement Amount that you are eligible to claim ( Estimated Settlement Share ) will be determined on a pro rata basis, based on the number of weeks you worked for Wedbush as a financial advisor from July 1, through [DATE OF PRELIMINARY APPROVAL] ( Workweeks ). Your Estimated Settlement Share is $XXX.XX. The amount of the payment may change subject to approval of other payments by the Court. The amount you receive will be reported on an IRS Form. Your Estimated Settlement Share was determined based on Defendant s records of the total Workweeks you worked for Wedbush and is presumed correct. If you dispute the accuracy of Defendant s records as to the number of weeks worked during the Class Period, you must contact the Settlement Administrator and provide any documentation you have supporting such dispute at: Settlement Administrator Holzer v. Wedbush Securities, Inc. --

27 c/o ILYM Group [Insert Address] Submission of these documents must be postmarked before [0 calendar days for the date of mailing]. You are responsible for ensuring that the Settlement Administrator receives any Workweeks Dispute you submit.. How can I get a payment? HOW TO GET A PAYMENT FROM THE NET SETTLEMENT AMOUNT You do not have to do anything to qualify for a payment of your portion of the Net Settlement Amount.. What am I giving up in return for my payment? RELEASE OF CLAIMS If the settlement is approved you will receive the payment described above in exchange for the release of your wage and hour claims against Wedbush. Upon the effective date, you will be deemed to have fully, finally and forever released, settled, compromised, relinquished, and discharged Defendant and all of its officers, directors, shareholders, investors, employees, agents, insurers, parent company, affiliates, subsidiaries, successors, assigns, and any individual or entity that could be jointly liable with Defendant, (collectively Released Parties ) from any and all claims for wages, damages, unpaid costs, penalties, liquidated damages, benefits, fringes, interest, attorney fees, litigation costs, restitution, or equitable relief, arising out of the facts, circumstances, and primary rights alleged in the First Amended Complaint (FAC), including (a) all claims for failure to pay wages, including overtime wages and minimum wages; (b) all claims for failure to provide meal and/or rest periods, and associated premium payments; (c) all claims for failing to pay wages timely during employment and upon termination, and associated claims for waiting time penalties; (d) all claims for recordkeeping or wage statement violations; (e) all claims for failure to reimburse business expenses; (f) any claim for violation of California Business and Professions Code 0, et seq., arising from the above-referenced claims and those claims set forth in the FAC; and (g) all claims for penalties under PAGA. (the Released Claims ) The release of Released Claims pertains to the time period of May, through [DATE OF PRELIMINARY APPROVAL]. The Released Claims do not include claims for workers compensation benefits, retaliation, discrimination, or any claims that may not be released by law.. Do I have a lawyer in this case? THE LAWYERS REPRESENTING YOU The Court has approved PROTECTION LAW GROUP, LLP as Class Counsel. The firms contact information is: PROTECTION LAW GROUP LLP Heather Davis, Esq. Main Street, Suite A El Segundo, California 0 Telephone: () 0-0 Facsimile: () -0 --

28 . How will the lawyers be paid? Class Counsel will ask the Court for attorneys fees of up to thirty-five percent of the Gross Settlement Amount ($0,000.00) and reimbursement of litigation costs/expenses of up to $0, These amounts are subject to Court approval and the Court may award less than these amounts. You can object to the Settlement or some part of it.. How do I tell the Court if I don t like the settlement? OBJECTING TO THE SETTLEMENT You can object to the Settlement and you can give reasons for why you think the Court should not approve it. The Court will consider your views. To object, you must mail a written objection to the Claims Administrator stating your full name, the specific reason for your objection, and any legal support for your objection. Any objections must be signed and dated, and must be mailed in writing to the Settlement Administrator at: Settlement Administrator Holzer v. Wedbush Securities, Inc. c/o ILYM Group [Insert Address] All objections must be postmarked no later than [0 calendar days after mailing of notice]. You are responsible for ensuring that the Settlement Administrator receives any objection you submit. You may also attend the Final Fairness Hearing and object to the settlement at t time if you wish to do so. OPT-ING OUT OF THE SETTLEMENT. Can I get out of the Settlement? You can get out of the Settlement. This is called excluding yourself or opting out. If you request to be excluded, you will not be paid from this Settlement, but you keep the right to file your own lawsuit against Defendant about claims alleged in this Lawsuit. If you wish to exclude yourself from the Settlement, you must submit a written statement to the Settlement Administrator clearly stating, I wish to exclude myself from the settlement reached in Holzer v. Wedbush Securities Inc., and I understand that by excluding myself I will not receive any money from this settlement. This statement must also include: (1) your full name (and former names, if any), () your current address, () your current telephone number, () the last four digits of your social security number, and () your dates of employment with Defendant. Your written request for exclusion must be signed and dated, andmust be mailed to the Settlement Administrator at: Settlement Administrator Holzer v. Wedbush Securities, Inc. c/o ILYM Group [Insert Address] All requests for exclusion must postmarked no later than [0 DAYS AFTER MAILING OF NOTICE]. If you request exclusion, you will receive no money from the Settlement. The judgment will bind all Class Members who do not timely and properly request exclusion. You are responsible for ensuring that the Settlement Administrator receives any request for exclusion you submit. --