Federal Income Tax purposes. The Employer hereby
agrees that the Board of Trustees of any such Section 415
Excess Benefit Fund shall be authorized to determine each
year the amount that will be contributed by the Employer
and the amount to be credited to the account of any eligi-
ble retiree for payment in lieu of accrued benefits that
would exceed the limits set by Section 415 of the Internal

Revenue Code.

Chicagoland Laborers’ Vacation Fund. The Employ-
er agrees to be bound by the Agreements and
Declarations of Trust, as well as any amendments thereto,
establishing the Chicagoland Laborers’ Vacation Fund, a
jointly-trusteed vacation plan established for the purpose
of providing income to members during their winter lay-
offs. Contributions to the Fund will be allocated in the
Union’s sole discretion from the total economic increase.

Chicagoland Laborers’ Annuity Fund. The Employ-
er agrees to be bound by the Agreements and Declar-
ations of Trust, as well as any amendments thereto, estab-
lishing the Chicagoland Laborers’ Annuity Fund, a joint-
ly-trusteed defined contribution plan providing a supple-
mental retirement benefit. Contributions to the Fund will
be allocated in the Union’s sole discretion from the total

economic increase.

Paragraph 6. SUPERVISORS: To the extent permis-
sible by the Internal Revenue Service or any Federal Act,
and for the purposes of Paragraphs 2 and 3 of Article V
of this Agreement only, the bargaining unit shall also
include those persons in the employ of an Employer who
are supervisors, as defined in the Labor Management
Relations Act, as amended; and who at one time were
Employee members of the bargaining unit herein on
whose behalf contributions were required to be made to
the trust funds described in the aforesaid Paragraphs 2

and 3 of Article V hereof.

Paragraph 7. Out of Town Work. When Laborers
who reside or work in the nine-county geographic area
covered by this Agreement are voluntarily requested to

17


oF . ‘008 “615
May~09-2007 12:25pm From-Lahorers‘Pen & Wel Funds T-35t P0047 F

the Employer or contribution obligations of the Employer to the Fund shall be deemed by the
Fund as a successor employer to the Deadbeat Employer for purposes of the delinquent
contribution obligations of the Deadbeat Employer to the Fund and shall @ be liable to the Fund
for the unpaid liabilities of the Deadbeat Employer and (ii) be required to post a bond for the
benefit of the Fund in an amount equal to twice the amount of the Deadbeat Employer's prior

delinquencies to the Fund.

© ROCEDURES WHI EMPL MAY AVOID LIABIL)

UNDER THIS SECTION, The Fund shall send written notice (the "Notice") to any Employer
whom the Trustees reasonably believe, is owned, in whole or part by a Deadbeat Employer, or
who employs an officer, patiner or owner of 2 Deadbeat Employer in a managerial or
supervisory position or in any other responsible position in which the Deadbeat Employer may
exercise any control over the assets of the Employer or contribution obligations to the Fund. The
Notice will provide the Employer with a date certain, no less than 30 days after the date of
transmittal of the Notice to the Employer, to provide evidence, satisfactory to the Trustees, that
the Employer should not be subject to the provisions of subsections (a) or (b), as applicable, as
the Employer deems appropriate in order to avoid liability under this Section. Any Employer,
following the date set forth in the Notice from the Fund, who does not provide such satisfactory
evidence to the Trustees, shall be subject to the obligations set forth in subsections (a) or (b), as
applicable, Any Employer who empioys an officer or owner of a Deadbeat Employer in a non-
managerial or non-supervisory position or in any other position in which the Deadbeat Employer
does not exercise any control over the assets of the Employer or contribution obligations to the
Fund will not be considered a successor employer and will not be required to post the bond
described in this Section.

@ = MISCELL, x8) OVISIONS, The bond referenced in this Section shall be

in addition to any other bond requirements set forth in the Written Agreement. The Trustees shall
have discretion to waive the additional bond requirement or to reduce the amount.of the bond,
when, based on the specific circumstances, the Trustees determine it is reasonable to do so.
Whenever a family member of a Deadbeat Employer purportedly has an ownership interest of an
Employer that employs an officer, partner or owner of a Deadbeat Employer, there will be a
rebuttable presumption that the Deadbeat Employer has substantial contro! over the assets of that

Employer. ”
mm

xcept. i ended, the Ti nt_shall remain in full and

effect in accordance with its terms,


LABORERS’ PENSION AND WELFARE FUNDS
POLICY FOR SCHEDULING OF AUDITS

As Adopted by The Boards of Trustees
Effective as of April 1, 2006

Contributing employers to the Laborers’ Pension Fund and the Health and Welfare
Department of Construction and General Laborers’ District Council of Chicago and Vicinity
(collectively, the “Benefit Funds”), shall be audited periodically in accordance with the procedures
adopted by the Collection Committee of the Benefit Funds. The Director of the Field Department, in
cooperation with the Benefit Funds’ auditors, shall prepare a schedule for auditing contributing
employers in accordance with the following procedures.

Two types of audits shall be conducted: “full audits” in which payroll and other records on all
employees are examined and “sampling audits” in which a selection of payroll and other records are
tested to enable the compliance auditor to make a reasonable determination that there are no
delinquencies. A sampling audit should include a review of all types ofrecords (¢.g. payroll records,
tax records, cash disbursement records, reports to other benefit funds, etc.) Where a sampling audit
discloses delinquencies or related record discrepancies, a full audit shall be conducted.

Employers shall be scheduled for either full audits or sampling audits in groups based upon
the contribution histories of the employers, Either a sampling or full audit shall be conducted at least
once every five (5) years. Any employer that fails to schedule an audit and submit records forreview
within 45 days from the date of the audit request will be liable for all costs of compelling and
enforcing the audit request. The following procedures shall be used:

AUDIT PERIOD

1. New Employers, New employers shall be scheduled for audits within the first year in
which contributions to the Benefit Funds are required.

2. Honor Roll Employers. Employers with a history of adequate record keeping and timely,
payments to the Benefit Funds (“Honor Roll Employers”), shall be required to submit to audits every
three (3) to five (5) years. Following an audit showing adequate record keeping and correct
payments, such an employer shall be designated an Honor Roll Employer and shall be selected
randomly for an audit between the third and fifth year thereafter, (Such employers may opt for a
scheduled audit every three years.) An inadvertent shortage of no more than the greater of $1000 or
two percent (2%) of required contributions determined on a full audit covering three or more years of
contributions to the Benefit Funds shall not disqualify an employer from inclusion in this group.

3. Other Contributing Employers. Employers that are not classified as New or Honor Roll
Employers or who have been assessed significant delinquencies to the Benefit Funds or any of the
ancillary funds to which contributions are owed pursuant to the collective bargaining agreements of
the Laborers’ District Council shall be scheduled for full audits at least once every three (3) years.


ADDENDUM A

RECORDS REQUIRED TO BE RETAINED BY EMPLOYERS
AND PRODUCED FOR AUDITS

The following records shall be maintained and retained by all contributing employers to
the Benefit Funds for at least six years from the contribution date and shall be produced for
inspection and copying by an auditor of the Benefit Funds upon written request:

1. Quarterly and annual payroll tax retums, including, but not limited to, federal
quarterly form 941's, federal annual form W-2's, W-3's, 940's, 1099's and state quarterly

unemployment returns (form UC-3).

2. Payroll journals and/or registers which include or identify employees’ social security
numbers, hourly rates of pay, hours worked and the time period in which the work ‘was

performed.

3. Individual earnings records for all employees of the employer not shown on payroll
journals or registers, including social security number and work classification (or code or clock
or ID number), hourly rates of pay, hours worked and the time period in which the work was

performed,
4. Cash disbursement journals and general ledgers.

5. Copies of all contribution reports and proof of payment (canceled checks or records of
canceled checks) of all contributions to the Laborers’ Funds and to all other trade union fringe

benefit funds to which the employer contributed.

6. Copies of ali dues records and proof of payment (canceled checks or records of
canceled checks) of all union dues submitted to the Laborers‘ District Council.

7. Records showing all amounts paid to all persons or entities that performed work for
the employer as independent contractors or subcontractors, if any, including copies of any
federal form 1099's issued by the employer.

8. Daily time records filed by employees or supervisors.

9. Source documents and lists of job codes and equipment codes.

10. Certified payrolls for public sector jobs where such payrolls are required.

11. Employee personnel files including, but not limited to, last known addresses and
telephone numbers, any documents which demonstrate employees’ job classifications and/or

status as an apprentice, journeyman, foreman, superintendent, or supervisor. (Confidential
medical records or other private records not relevant to the establishment of an employee’s job

classification shall not be disclosed.)



If full wages are not timely transferred to the
employee’s account, the Employer shall pay the employee
an additional four (4) hours pay for each day or portion
thereof until full wages are received. Employers who vio-
late the provisions of these paragraphs shall be denied the
use of electronic banking for wage payments.

Dosimeter Use: A premium of One ($1.00) Dollar
per hour shall be paid to any Laborer required to work
with a dosimeter used for monitoring nuclear exposure or
with any similar instrument or measuring device.

Power Pac: When a Laborer uses a power driven
piece of equipment he shall be paid the rate of pay of the
tool at the end of the power pac.

Liquidated Damages: Payment by the Employer and
acceptance by the Employee of less than the wage herein
stipulated shall be a violation of this Agreement upon the
part of each. Upon conclusive proof to the Joint Griev-
ance Committee of such violation, the Employer shall
immediately pay the unpaid balance due in accordance
with the wage herein stipulated; and in addition thereto,
shall pay as directed by the Joint Grievance Committee an
amount no less than fifty percent (50%) of the amount of
such pay shortage as just and liquidated damages because
of such violation. In cases where an employee was know-
ingly complicit in the underpayment of wages, none of the
liquidated damages assessed against the Employer shall be
awarded to that employee. :

Paragraph 2. WELFARE: Beginning the period from
June 1, 2010 to May 31, 2011, the Employer agrees to
make Health and Welfare contributions of $10.63 per
hour for each hour worked by all Employees covered by
this Agreement in addition to the wages herein stipulated.
This $10.63 per hour shall be paid to the Health and
Welfare Department of Construction and General
Laborers’ District Council of Chicago and Vicinity or a
designated appointee at the end of each month.

That for the periods June 1, 2011 to May 31, 2012;
June 1, 2012 to May 31, 2013; that on May 1 of each

11


GRANTOR:
Kenneth M. Jacobs, ly

REDITOR:
James 8, Jorgensen, Administrator of the Laborers' Pension Fund and Laborers' Welfare Fund for the Health and

Welfare Department of the Construction and General Laborers' District Council of Chicago and Vicinity, and agent
of the General Laborers’ District Council of Chicago and Vicinity Training Fund.



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LABORERS’ PENSION FUND and
LABORERS’ WELFARE FUND OF THE
HEALTH AND WELFARE DEPARTMENT
OF THE CONSTRUCTION AND GENERAL
LABORERS’ DISTRICT COUNCIL OF
CHICAGO AND VICINITY, and JAMES S,
JORGENSEN, Administrator of the Funds,
Plaintiffs, Case No. 12 C 2514
vy.
Judge Zagel
JACOBS & SON, INC., an Illinois corporation,
and KENNETH M. JACOBS, individually,

SS SS SS ee SSS

Defendants.

SETTLEMENT AGREEMENT AND STIPULATION TO DISMISS

NOW COME Plaintiffs Laborers’ Pension Fund and Laborers’ Welfare Fund of the
Health and Welfare Department of the Construction and General Laborers’ District Council of
Chicago and Vicinity, and James S. Jorgensen, Administrator of the Funds (collectively
“Punds”), by and through their attorney Patrick T, Wallace, and Defendants Jacobs & Son, Inc.
and Kenneth M. Jacobs (“Jacobs & Son” and “Jacobs,” respectively), by and through their
attorneys, Todd A. Miller and Kathleen M., Cahill of the firm of Allocco Miller & Cahill, P.C.,
and hereby submit the parties’ Settlement Agreement and Stipulation to Dismiss. In support of
this Agreement, the parties state as follows:

1. ‘The parties have settled the case pursuant to the terms of an Installment Note,
Guaranty of Payment and Indemnification (“Guaranty”), Commercial Security Agreement
(“CSA”) and a Contract for Cash Bond, true and accurate copies of which are attached hereto as

Exhibits A, B, C and D,

EXHIBIT

iB-S


Te3di P.UUBsUUe FetitD

May~uy"cuUl iéi¢opm = From=Laporers Fan & Wel Funds

the Employer or contribution obligations of the Employer to the Fund shall be deemed by the
Fund &s a successor employer to the Deadbeat Employer for purposes of the delinquent
contribution obligations of the Deadbeat Employer to the Fund and shall (i) be liable to the Fund
for the unpaid liabilities of the Deadbeat Employer and i) be required to post a bond for the

@ MISCELLANEOUS PROVISIONS. The bond referenced in this Section shall be
in addition to any other bond requirements set forth in the Written Agreement, The Trustees shalt
have discretion to waive the additional bond requirement or to reduce the amount of the bond,
when, based on the specific circumstances, the Trustees determine it is reasonable to do so.
Whenever a family member of a Deadbeat Employer purportedly has an ownership interest of an
Employer that employs an officer, partner or owner of a Deadbeat Employer, there will be a
rebuttable presumption that the Deadbeat Employer has substantial control over the assets of that

Employer, ”
qr,

Except as hereinbefore amended, the Trust Agreement shall remain in full force and
effect in accordance with its terms,



tto this Ingtallment Nota shall be constdored “contributions” as defined ander (he terms of

8. Payments mada. pursun)
Kf the contributions are not paid by tho

teCBA and the.Fand’s respective Agreamants ind Declaraffons of Trust.
10 day following the date on which. payment should Have Been récdived, She contribution shalt be considered

dotinquent aad all charges which Kpply te the Inte payntent of contributions wader the torms of the CBA snd {he
Fund's respective agreomonts and Doclaratlons of Trust shall apply, eluding, but not Himited to, thy assessment of
{ntorest and liquidated dantages, Purther, fu the event the Compnny-falls to timely make any payments described In
iinfg Note, AUL xmauimts described (i paragraph 1 kerela shall fraarediately beedmte «lve on (to 10" day Laltowlng tie
dato ou: whicle payniont should bave beon tucetved hy the, Fund's under the terms of thie Note. la stich ovont te
‘Company furthor ugroes to-pay all xttoracy fees and costs focurred by the Funds in any action to enforce any part.or

aL of this Note.

9 Lhls Inataliment Note is eauditioned on the, Company's staying curvent on its obligations (0 tho Funds under the
feriits of the cotiact(ve bargaining.agreement and tho Randle respective Agreoments and Deelarations of Trust, Jn
the,ovont thal the, Company fails to malitaln its obligations under the fering Of the collective bargalaing agreement
and the Winds* respective Agreements and Boclurilions of ‘Trust, including, byt Ho Tinited to, its obligations
atibmit timely contribution roports and to make timely contribution payments by the tenth diy foltowhig the maonth

In yvbich Layovors* wark was performed, then the Wiis shall have the rightto accelorate and collect all amounts due

imder this Ynstallment Nate, plus, paynrent of all, attornoys* feos und yosts Incurred by. Mie Fuuds-ia any action to
aceolerate this Trstallmont Note,

16, ‘The Company futher agreos to obtain ond maintain a surety bpad fo insur the paymesit of wages ond benefit
coutribations ns required under the terins.of the CA,

£ duo nidor the Note prior-to the date upos which

11, The Conipany shall havé the right to prepay the entire amount
ceoalewlatad Note intayest frat has not aecrned as of

payorent is due without ponalty snd without payment of any pre
the date full payment has been made,

The Pardes hershy agres to these terms by thelr oxecution Hrov'eof on the ist ay of the Aust , 2012,

Sacobss & Sy Wyss

“es ~~

fnidat the Month and Welfare Depaxtmont of tho Construction and General Laborers? District Connell af

By;


17, Severability, If all or any portion of any provision of this Guaranty is declared or found by a court of
competent Jurisdiction to be unenforceable or null and vold, such provision or portion thereaf shall be deemed stricken
and severed ‘from this Guaranty and the remaining provisions and portions hereof shall continue in full Joree and

effect,

18. Applicable Law: Venue, This Guaranty and (he transactions evidenced hereby shail be construed and
interpreted under the laws of the State of Illinois, Guarantor, in order to Induce the Pands to accept this Guaranty and
infer into the loan agreement, and fos other good and valuable consideration, the receipt and sufficiency of which
hereby is acknowledged, agrees that all actions or proceedings arising directly, indirectly or otherwise in connection
with, out of, related to ot from this Guaranty shall be litigated, at the Fund's sole discretion and cleation, only in courts
having a situs within the county of Cook, State of Titinois, Bastern Division, Guarantor hereby waives any right he or
she may have to transfer of change the venue of any litigation brought against him by the Funds on this agreement to

accordance with this paragraph.

t9. Time is of the Pssence, Time is of the essence of this Guaranty as to the performance of the undersigned,

26. Death of a Guarantor, In the event of the death of Guarantor, the Punds shali have the right to accelerate:
the Indebtedness evidenced by the Note unless, within sixty (60) days of his death, Guarantor's estate assumes his
obligations hereunder by an instrument satisfactory to the Funds and delivers fo the Funds security for performance of

such obligations satisfactory to the Funds.

IN WITNESS WHEREOF, the three undersigned Guarantors hus exccuted this instrument 9-4
year first above written, a“

Kennoth Jacobs 3901 Industrial Avenue Rolling Mondows, TL 60008 tee

Kon " Van Oeil

Social Security Number . a

Dare: August 29th, 2012 . . —

APPROVED AS TO PORM AND SUBSTANCE
ON BEWALF OF GUARANTOR;

Dated: __ emcee

<> TG agroomaent ks being executed aubjed| to the following:
1) Jacobs & Son/ Kenneth Jacobs. bank always tnkos First position,
2) Thw personal anroomont is linuted to the 24 nlonth duration of the note,
3) Incobs a Sou /Kemotb Facabs has the right to pay afPalt monies duo in advance wlihout penalty.
4) Ln the event Juoabs & Son / Kenneth Jacobs pays all snonies do in advance of Dw 24 month period,
thle noto/guaranty will terminate,


May-08-2007 12:25pm — From-Laborars'Pen & Wel Funds

T3510 P.OUG/UUN ebb

AMENDMENT TO THE
RESTATED AGREEMENT AND DECLARATION OF TRUST
OF THE HEALTH AND WELFARE DEPARTMENT OF THE CONSTRUCTION AND
GENERAL LABORERS’ DISTRICT COUNCIL OF CHICAGO AND VICINITY

WHEREAS, Article XI of the Restated Agreement and Declaration of Trust (“Trust
Agreement”) provides that the Board of Trustees of the Health and Welfare Department of the
Construction and General Laborers’ District Council of Chicago and Vicinity (“Fund”) have the
authority to amend the Trust Agreement;

WHEREAS, Article IV of the Fund’s Trust Agreement sets forth the powers and duties
of the Trustees;

WHEREAS, the Tnustees have an obligation to protect the interests of the Plan’s
Participants and to protect the assets of the Fund;

WHEREAS, the Trustees are aware of situations in which contributing Employers have
ceased business operations leaving a large indebtedness to the Fund without a reasonable
likelihood of the Fund collecting such delinquent contributions;

WHEREAS, the individual officers and owners of some Employers have secured jobs
knowing that they will not comply with their legal obligations to the Fund by keeping accurate
records of their laborer employees' employment and make all the required contributions to the
Fund; and

WHEREAS, such illegal conduct causes substantial losses to the Fund and deprives
Employers who comply with its obligations to the Fund of opportunities to secure employment
for their laborer employees; and

WHEREAS, the individual officers, partners or owners of some contributing Employers
have used various entities to avoid Kability to the Fund for contributions that would otherwise be
due and then created new companies in order to contime to operate using such illegal practices;

WHEREAS, in some instances such individual officers or owners have accepted
employment as a supervisor or manager with another contributing Employer and been
responsible for causing such Employers to fail to comply with their obligations to keep accurate
records and make all Tequired contributions; ©

WHERBAS, the Trustees have determined that certain individuals and entities (as
hereinafter defined “Deadbeat Employers”) who engage in these practices willfully or with
reckless disregard for their legal obligations or with repeated incompetence at the expense of
their employees and the Fund have caused the Fund to incur large financial losses and employees
to lose benefit coverage for which they had worked;


by said contract, working dues in the amount of one and
one-half percent (1.5%) of gross wages or such amount
approved by the Union for each hour worked and shall
remit monthly to the Union office the sums so deducted,
together with an accurate list of Employees from whose
wages said dues were deducted and the amounts applica-
ble to each Employee, not later than the 10th day of the
month next following the month for which such deduc-
tions were made. Dues remittance reports shall include a
report of the hours worked and wages earned by each
Laborer. Employers who fail to timely remit Union dues
shall be assessed an additional ten percent (10%) liquidat-

ed damages.

Paragraph 3. The Union will submit to the Employer
a written statement of respective amount of initiation fees
and Union dues due the Union. The Employer will then
deduct said amounts from each Employee’s pay every
weekly pay period until the total amount of initiation fees
and dues have been deducted. Deductions from the week-
ly wages shall be not less than Twenty-five ($25.00)
Dollars per week to apply to initiation fees and dues until

fully paid.

Paragraph 4. Deductions shall be remitted to the
Union or to a designated appointee of the Employer
promptly, and the Local Union shall acknowledge receipt
of the money. The Employer shall furnish the Union with
a record of those for whom deductions have been made,
the amount of the deductions, and a list of absentees.

Paragraph 5. Employees may authorize deductions
of more than the aforesaid Twenty-five ($25.00) Dollars
per week, if they so desire, in order to complete early pay-
ment of initiation fees and quarterly dues.

Paragraph 6. It is the intention of the parties that
such deductions shall comply with the requirements of
Section 302(c)(4) of the Labor Management Relations
Act of 1947, as amended, and that such deductions be
made only pursuant to written assignments from each
Employee on whose account such deductions are made,

21


May-08-2007 12:25pm From-Laborers‘Pen & Wel Funds + 7-351 P.005/009 = F615

IN WITNESS WHEREOF, the undersigned Trustees have caused this Amendment to be
executed on the dates appearing opposite their respective names,

Halal pees GlMM a4 Cxcto¥” Uff ef,

CHARLES COHEN DATE OsEPH COCONATO DATE
kta © Pitz Ypujy, fate, RE vas, Utes
ALAN Escue DATE Caames P. CONNOLLY

fifa MICHA TTO)|=—s«zDATE EMG
Wi sft Lud, -eifos /DL
4 FRANK RILEY
4 fv Joe Js LZ hb. 2Milocs
A LA DATE ifr
df: S/a( Tita Bph-OC
ARY GC DA DATE



Notices. All notices required to be given ander this Agreement shall be given in writing, may be sent by
tclefacsimile (anless otherwise required by law), and shal! be effective when actually delivered or when
deposited with a nationally recognized overnight courier or deposited in the United States mail, first class,
postage prepaid, addressed lo the party to whom the notice is to viven at the address show above. Any
party may change its address for notices under this Agreement by giving formal written notice to the other
parties, specifying that the purpose of the notice is to change the party’s address, To the extent permitted
by applicable faw, if there is more than one Grantor, notice to any Grantor will constitute notice to all
Grantors. For notice purposes, Grantor will keep Creditor informed at all times of Grantor's current

address(es).

Power of Attorney, Grantor hereby appoints Creditor as ifs trae and lawSul attormey-in-fact, irrevocably,
with full power of substitution Lo do the following: (x) to demand, collect, receive, receipt for, sue and
recover all sum of money or other property which may now or hereafter become due, owing or payable
from the Collateral; (b) to execute, sign and endorse any and al) claims, instruments, reecipts, checks, drafts
sued in payment for the Collateral; (c) to settie or compromise any and all claims arising
under the Collateral; and, ifthe place and stead of Grantor, to execute and deliver its release and setlement
for the claim; and (d) to file any claim or claims or to take any action or institute or take part in any
proceedings, either in ils own name or in thé name of Grantor, or otherwise, which in the discretion of
Creditor may seem to be necessary or advisable. power is given as security for indebtedness, and the
authority hereby conferred is and shall be irrevocable and shall remain in full force and effect until

renounced by Creditor,

Severability, Ua court of competent jurisdiction tinds any provision of this Agreement to be invalid or
unenforceable as to any person ar circumstances, such finding shall nat rendor {hat provision invalid or
unenforceable os to any other persons or circumstances. If feasible, any such offending provision shall be
dcemed to be modified to be within the limits of enforceability or validity; hawever, ifthe offending,
provision cannal be so modified, it shall be stricken and all other provisions afthis Agreement in all other

respects shall remain valid and enforceable,

Successor Interests, Subject to the limitations set forth above on transfer of the Collateral, this Agreement
shalt be binding apon and inure to the benefit of the parties, their successors and assigns,

Waiver. Creditor shall nat be deemed to have waived any rights under this Agrocment unless such waiver
is given in writing and signed by Creditor, No delay or omission on the part of Creditor in exercising, any
right sball aperate as a waiver of such right or any other right. A waiver by Creditor of a pravision of this
Agreement shall not prejudice or constitute a waiver of Creditor's right otherwise to demand strict
compliance with that provision or any olher provision of this Agreement. No prior waiver by Creditor, nor
any course of dealing between Creditor and Grantor, shal! constitute a waiver of any of Creditor's rights or
of any of Grantor's obligations as to any future transactions. Whenever the consent of Creditor is required
under the Agreement, the granting of stich consent by Creditor in any instance shall net constitute
continuing consent to subsequent instances where such cousent is required and in all case such consent may

be granted or withheld in the sole discretion of Creditor.

GRANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS COMMERCIAL
URITY AGREEMENT, AND GRANTOR AGREES TO ITS TERMS. THIS AGREEMENT (8 DATED
September 07,2012,

GRANTOR
Jacubs & Son, Inc,

anne

nd Sharcholder



Case: 1:12-cv-02514 Document #: 16 Filed: 11/30/12 Page 1 of 2 PagelD #:57

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LABORERS’ PENSION FUND and
LABORERS’ WELFARE FUND OF THE
HEALTH AND WELFARE DEPARTMENT
OF THE CONSTRUCTION AND GENERAL
LABORERS’ DISTRICT COUNCIL OF
CHICAGO AND VICINITY, and JAMES S.
JORGENSEN, Administrator of the Funds,

Plaintiffs, Case No. 12 C 2514
Vv
Judge Zagel
JACOBS & SON, INC., an Iinois corporation,
and KENNETH M. JACOBS, individually,

Defendants.

ORDER - DISMISSAL,

This matter having come before the Court on the parties’ Settlement Agreement and
Stipulation to Dismiss (“Settlement Agreement”), due notice having been given, IT IS HEREBY
ORDERED:

1. That this matter is dismissed without prejudice, The Court will retain jurisdiction
to enforce the terms of the Settlement Agreement including the Note, Guaranty of Payment and
Indemnification, Commercial Security Agreement, and Contract for Cash Bond against
Defendants Jacobs and Son, Inc, and Kenneth M. Jacobs up and through September 30, 2014

2. Unless a timely motion is filed to reinstate the matter before September 30, 2014,
the matter shall be dismissed with prejudice except that the dismissal will be without prejudice to

the Funds’ right to conduct an audit of the Company’s books and records for the period of

EXHIBIT


A, Procedures For Filing a Cash Bond and Use of the Bond.

The Employer named above shall pay the amount Jisted below to the Funds as a cash
bond to guarantee payment of employee wages, pension and welfare contributions owed to the
Employer to employees of the Employer and/or to the Funds for work performed by the
employees under the terms of a collective bargaining agreement between the Employer and the
Construction and General Laborers District Council of Chicago and Vicinity,

The cash bond shall be used to satisfy on a pro rata basis amounts due for unpaid wages
and/or unpaid contributions to the Funds, including liquidated damages and interest owed to the
Funds; and

The Administrator of the Funds is authorized to depasit the cash payment listed below in
an interest-bearing account, money-market account or other account for deposit of such funds to
be selected at the discretion of the Administrator, to retain the interest earned on a said cash
deposit to defray the expenses of the Funds for the administration of cash bonds and for the
collection of delinquencies; and

To deduct from said account and pay to employees and/or to the Funds any amounts
determined by the Administrator, based upon reasonably reliable information provided by
representatives of the Union, the Field Representatives of the Funds or compliance auditors of
the Funds or Union, the full amount of any unpaid wages or unpaid contributions, liquidated
damages or interest.

The Administrator sha!l provide written notice at least ten (10) days in advance to the
Employer of a determination by the Administrator to deduct sums from the cash bond to satisfy

the claims for wages and/or unpaid contributions, liquidated damages or interest,


CONTRACT FOR CASH BOND
This agreement is entered into by The Laborers Pension Fund, the Health and Welfare
Department of the Construction and General Laborers District Council of Chicago and Vicinity

(the “Funds”) and the following contributing employer to the Funds:

Kenneth Jacobs / Jacobs & Son

ull Name) ~

3901 Industrial Avenue
(Address)

Rolling Meadows, IL 60008
(City, State, Zip Code)

WHEREAS Article VU, Section 2 and Article VI, Section 2 of the agreements and
declarations of trust establishing the aforementioned Pension Fund and Health and Welfare Fund
to authorize the Funds to accept cash bonds as guarantees for the payment of monthly
contributions to the Funds; and

WHEREAS contributing employers under the terms of the applicable collective
bargaining agreement are required to post surety bonds or cash bonds in a form acceptable to the
Construction and General Laborers District Council of Chicago and Vicinity (the “Union”);

WHEREAS the Union has agreed to the establishment by the Funds of a bank account or
money-market account or other account for the holding of cash bonds pursuant to contractors
approved by the Boards of Trustees of the Funds; and

WHERBAS the Boards of Trustees of the Funds have approved the establishment by the
Funds of a bank account or tnoney-market account or other account for the holding of cash bonds
by contributing employers;

NOW therefore, the parties hereby agree that:

EXHIBIT


Bond may be refunded prior to the completion of any audit if the shareholders of the Company
personally guarantee any indebtedness that may be revealed pursuant to an audit of the
Company’s books and records for the time period during which the Funds held the Cash Bond,

An Employer may obtain a refund of the cash bond if the Employer provides a surety
bond written by an insurance cartier with reserves in excess of $1,000,000 authorized, licensed,
or permitted to do business in the state of Ilinois; provided that the amount of said surety bond is
in compliance with the terms of the Employerfls collective bargaining agreement with the Union
or any amount previously prescribed by the Trustees for a delinquent employer equal to three
times the monthly contributions of such Employer, as estimated by the Trustees, in accordance
with the terms of the agreements and declarations of trust of the Funds.

No cash refund shall be paid to the Employer until the Employer has provided the
necessary surety bond or evidence satisfactory to the Administrator that the employer has ceased
doing business that would require contributions to the Funds. If the Employer fails to provide a
refund request along with the necessary supporting information within three years of the date on
which the Employer last contributed to the Funds, the Employer shall forfeit its right to a refund
and the Administrator shal! transfer any balance credited to the Employer to the general accounts

of the Funds to defray the costs of employer delinquencies.


LABORERS’ PENSION AND WELFARE FUNDS
POLICY FOR RETENTION AND PRODUCTION OF EMPLOYER RECORDS

As Adopted by the Boards of Trustees
Effective as of April 1, 2006

WHEREAS, Section 209 of the Employee Retirement Income Security Act of 1974 , as
amended ("ERISA"), 29 U.S.C. Section1059, requires employers obligated to contribute to
employee benefit funds to maintain records with respect to its employees which are sufficient to

determine benefits due to such employees of which may become due to them; and

WHEREAS, the Trustees of the Laborers' Pension Fund and the Trustees of the Health
and Welfare Department of the Construction and General Laborers’ District Council of Chicago
and Vicinity (collectively, the “Benefit Funds”) have the authority under their respective Trust
Agreements to establish rules, regulations and policies regarding records which must be
maintained by employers in order to administer the Benefit Funds; and

WHEREAS, the Trustees of the Benefit Funds have found that most contributing
employers maintain proper records and make all required contributions to the Benefit Funds,
nevertheless, there are employers who are bound by the Trust Agreements of the Benefit Funds
who fail to maintain records which are adequate for the Funds to determine whether proper
contributions have been made on behalf of eligible employees and that some of such employers
do so deliberately in order to avoid their obligations to make such payments; and

WHEREAS, the practices of employers who fail to maintain records sufficient to enable
the Benefit Funds to conduct thorough payroll audits cause their employees to lose valuable
pension and welfare benefits and cause the Benefit Funds to lose contractually required

contributions and investment earnings on those contributions; and

WHEREAS, the practices of employers who fail to maintain adequate records cause the
Benefit Funds to incur substantial additional administrative and legal expenses in order to
determine proper amounts owed to the Funds by such employers; and :

WHEREAS, enforcement of a policy specifying the records required to be maintained
and produced increases the ability of the Funds to prove the contributions owed by delinquent
employers and thereby to provide proper credit to the employees and their beneficiaries;

NOW THEREFORE, the Trustees resolve that the following policies are adopted by the
Benefit Funds effective as of March 1, 2002:


work at locations outside these nine counties, the
Employer shall continue to report and pay benefits for all
hours worked outside the nine counties. If the work per-
formed is covered under a labor agreement with the
Laborers’ International Union of North America or its
affiliates, the Employer shall report and pay the benefit
contributions to the fringe benefit fund identified, and the
contribution rates specified, under that labor agreement.
If the work performed is not covered under a labor agree-
ment with the Laborers’ International Union of North
America or its affiliates, then the Employer shall report
and pay the benefit contributions to the fringe benefit
funds identified, and the contributions rates specified,
under this Agreement. No employee shall be obligated to
accept out of town employment or subject to retaliation

for refusing such work.

Paragraph 8. Special Rules for Bonding. An employ-
er that is owned or managed, in whole or part, by an indi-
vidual who currently has or previously had in the last ten
(10) years ownership or principal managerial responsibil-
ity for another contributing employer that currently is or
ceased doing business when delinquent to the Funds shall
be required to post for the benefit of the Funds an addi-
tional cash bond or obtain a surety bond from a Fund-
approved insurer in an amount equal to twice the amount
of the other contributing employer’s delinquency. This
amount may be adjusted by the Benefit Fund Trustees for
each individual employer. This bond shall be in addition
to and separate from the bond required elsewhere in this

Agreement.

Paragraph 9. Withdrawal of Employees. If the
Employees are withdrawn from any job in order to collect
contributions to the Laborers’ Health and Welfare,
Pension and/or Apprenticeship and Training Funds, the
Employees who are affected by such stoppage of work
shall be paid for lost time up to sixteen (16) hours, pro-
vided that two (2) days’ written notice of intention to
remove employees from the job is given to the Employer
by the Union. These lost time amounts may be collected

18


"DECLARATION OF TRUST

- LABORERS’ oe
_ PENSION FUND”

: With Aime admeiits Thi fough ae

ae - May3 1, 2002 :

EXHIBIT.


(a) Formation of Partnerships;

(b) Termination of business;

(c) Change of name commonly used in business
operation;

(d) Change in form of business organization;

(e) Incorporation of business;

(£) Dissolution of corporation; ;

4 (g) Name and business organization of successor;

an

(h) Admission to or withdrawal from any associa-
tion operating as a multi-employer bargaining unit.

Paragraph 5. Withdrawal of Employees. If the Em-
ployees are withdrawn from any job in order to ensure
compliance with the provisions of this Article, the
Employees who are affected by such stoppage of work
shall be paid for lost time up to sixteen (16) hours, pro-
vided that two (2) days’ written notice of intention to
remove employees from the job is given to the Employer
by the Union. These lost time amounts may be collected
only from the contractor with whom the Union has a dis-
pute and not from any other entity. The foregoing shall
not apply if the Employer produces the required bond
before expiration of the 2-day notice period.

Article Vil
CHECK-OFEF & DUES DEDUCTIONS

Paragraph 1. Employers also agree to deduct from
the net earnings payable to an Employee covered by this
Agreement, initiation fees and quarterly Union dues inso-
far as permitted by state and federal laws upon receipt
and in accordance with a duly executed authorization
form from the Employees. Said authorization form shall
not be revocable for a period of more than one (1) year or
prior to the termination date of this Agreement, whichev-
er occurs sooner.

Paragraph 2. All Employers covered by this Agree-
ment shall deduct from the wages of Employees covered

20


1, Except as otherwise provided herein, all contributing employers to the Benefit Funds
shall maintain and make available for inspection and copying by an auditor of the Benefit Funds
the records listed on Appendix A, attached hereto.

2. Any employer obligated to contribute to the Benefit Funds who fails to maintain and
make available for inspection and copying to an auditor of the Benefit Funds the requisite
records listed on Appendix A shall bear the burden of proof with respect to the exclusion of any
employee from coverage by the collective bargaining agreement with the Union. In those cases
where an employer asserts that an employce is excluded because he/she is a member of another
bargaining unit, the employer must submit tangible evidence of that fact, ¢.g., a union
membership card, contribution records maintained for the benefit funds of the other bargaining
unit, commercial drivers’ license if it is asserted that an employee is a truck driver rather than a
laborer and workers’ compensation policies, forms and applications listing an employee's job
classification or other business records. The affidavit of an employer’s representative or officer
unsupported by documentary evidence shall not be sufficient to meet the employer’s burden of
proof. Affidavits solicited and obtained ex parte by an employer's representative from
employees, for which there is no corroborative evidence in the form of records maintained in the
ordinary course of business, shall not be sufficient to meet the employer’s burden of proof.

3. When an employer has failed to maintain or make available the requisite records, there
shall be a rebuttable presumption that any employee listed as a possible laborer by an auditor,
Field Representative or attorney representing the Benefit Funds was a laborer. There shall also
be rebuttable presumptions concerning the hourly rate and number of hours worked as follows:
(a) that the employee was paid only $10.00 per hour if no record of wage rates was made by the
employer, and/or (b) that the employee worked 72 hours per week if no record of the number of
hours was maintained; whichever of these presumptions results in the higher amount of
contributions shall be applied. When evidence exists that a different hourly rate was paid to
employees of an employer that failed to maintain the required records, at the discretion of the
Director of the Field Department, a different hourly rate may be presumed for purposes of
determining the amount of contributions owed by the employer. If that evidence shows that the
employer paid a rate lower than $10.00 per hour to any employees doing bargaining unit work,
then that lower rate shall be presutned to be the actual rate paid to all employees for whom.
adequate records were not kept. Similarly, where evidence exists of a different number of hours
worked, the Director may apply a different number of hours for determining the contributions
owed, and this number of hours worked shall be presumed correct. All wages computed as
provided in this paragraph shall be presumed to be paid as straight time wages regardless of the
number of hours worked unless the employer has provided documentation, in the form required
by the terms of this policy, showing that it followed the requirements of the Fair Labor Standards
Act and/or the applicable collective bargaining agreeinent as to the payment of overtime.

4. An employer that fails to maintain the requisite records and fails to cooperate with the
Trustees in establishing the paid wage rates, actual hours of work and contributions owed to the
Benefit Funds shall be liable to the Benefit Funds and any related organizations, for the
contribution amounts determined as provided herein and also for 20% liquidated damages,
compound interest at the rate of prime plus 2 points (as determined by the Administrator),
auditor’s and attorney’s fees and any other expenses of collection including investigative costs.


the number of trustee appointments. If such parties are
unable to agree on the Signatory Associations to be
responsible for appointments and the number of appoint-
ments to be made by each Signatory Association the dis-
pute shall be submitted to expedited arbitration under
Subpart D of the Policies and Procedures of the Federal
Mediation and Conciliation Service.

Article III Section 2 of the trust agreements of the
Health and Welfare Department of Construction and
General Laborers’ District Council of Chicago and
Vicinity and the Laborers’ Pension Fund shall be amended
to include the following: “Association-appointed Trustees
must be full-time employees of Contributing Employers
within the Association’s membership. A Contributing
Employer shall be defined as an Employer that has
employed an average of five (5) or more Laborers per-
forming bargaining unit work for whom contributions
have been made per month in each of the previous three
(3) calendar years.”

The parties agree that the Health and Welfare De-
partment of Construction and General Laborers’ District
Council of Chicago and Vicinity and the Laborers’
Pension Fund will be operated and administered by a
board of trustees that is expanded to include 8 employer
and 8 union trustees. Appointing authority for the two
additional employer trustees shall be vested with new
employer associations that currently are not party to the
trust agreements and under whose labor agreements more
than 20,000 hours of benefits were paid in 2005.

Paragraph 5. FOX VALLEY FUNDS, RECIPROCI-
TY. Employers that employ Employees who participate in
the Fox Valley Laborers’ Health and Welfare Fund and
Fox Valley and Vicinity Laborers’ Pension Fund (collec-
tively “Fox Valley Funds”) may contribute directly to
these funds in the amounts allocated for the Fox Valley
Funds by the Union from the economic package.

Effective June 1, 2010 such an Employer shall con-
tribute for each hour worked $10.62 per hour to the Fox

15


The Employer, within ten (10) days of the date of the notice sent by the Administrator,
may make other arrangements to pay the wages and/or contributions determined to be owed by
the Administrator and shall provide written evidence to the Administrator of such arrangements

An objection by the Employer that the claimed wages and/or contributions are not due
and owing shall not prevent the Administrator from directing the payment of claimed wages
and/or contributions. Ifa determination is made at a later date that the wages paid to employees
or the contributions, liquidated damages or interest paid to the Funds was not due and owing, the
sole liability of the Funds shal! be to restore the cash bond of any Employer to the extent of the
contributions, liquidated damages and interest paid as contributions on behalf of the Employer
that should not have been paid. Any claim of the Employer for wages improperly paid to
employees shal! be made against the employees who received the payments and not against the
Funds or Administrator as long as the Administrator based the payments on information received
from a source that the Administrator considered to be reasonably reliable, An auditorl)s report or
employee affidavits shall be conclusive proof of such a reasonably reliable source.

The Employer may request and obtain a refund of any balance of the cash bond being

held by the Funds if the Employer ceases to do business for which contributions would be owed
to the Funds under the terms of a collective bargaining agreement with the Union or during any
period in which the Employer would be required to maintain existing terms and conditions of
employment while negotiating over the terms to be included in a new collective bargaining
agreement. The refund will be provided upon completion of an audit which verifies that there
are no outstanding contributions, interest, liquidated damages and/or audit costs revealed as due
and owing for the period of time under which the Funds have held the Cash Bond. The Cash

3


principal, to the Guarantor against a maker or obligor, fo an. accommodation party against the party accommodated, or
to a holder of transferee against a maker, and which the guarantor may have or hereafter acquire against the Company
jn connection with or as 4 result of Guarantor's execution, delivery and/or performance of this Guaranty or the Note,
‘The Guarantor agrees that he or she shall not have or assert any such rights against the Company or its successors and
assigns or any other party (including any surety), cither directly or as an attempted set off to any action commenced
against the Guarantor by the Company (as borrower or in any other capacity) or any other person.

5, Independent Obligations, The Funds may enforee this Guaranty without first resorting to or without first
having recourse to the Note; provided, however, that nothing herein contained shall preclude the Funds from suing on
the Note or from exercising any other rights; and the Funds shall note be required fo tustitute or prosecute proceedings
to recover any deficiency as a condition of any payment hereunder or enforcement hereof.

6. Acceleration. In the event that payments due under the Note shall be accelerated, the Guarantor’s
obligations hereunder shall also be accelerated without further notice from the Funds.

7. Bffect.of Bankruptoy, This Guaranty shall continue in full force and effect notwithstanding the institution
by or against the Company of bankruptcy, reorganization, readjustment, receivership or insolvency proceedings of ay
nature, or the disaffirmance of the Note in any sucls proceedings, of others.

§. Yermination, This Guaranty shall remain tn full force and effect as to the Guarantor until all of the

Companys’ Obligations under the Note outstanding shall be finally and irrevocably paid in full. Payment of’ all of the
5 Guaranty, If after receipt of any

Company’s Obligations from time to time shall not operate as a discontinuance of thi

payment of all or any part of the Company's Obligations, the Funds are for any reason compelled to surrender such

payment to any person or entity, because such payment is determined to be void or voidable as a preference,

impermissible set off, or a diversion of trust fund, or for any reason, this Guaranty shall continue in full force
hich may have been taken by the Funds in reliance upon such payment, and any

notwithstanding any contract action WI
such contrary action so taken shall be without prejudice to the Funds’ rights under (his Guaranty and shall be deemed

to have been conditioned upon such payment having become final and trrovocable.

9, The Company’s Binancial Condition, The Guarantor assumes full responsibility for keeping tuolly informed
of the Company’s financial condition and all other circumstances affecting the Company’s ability to perform its
Obligations, and agree thet the Funds will have no duty to report to Guarantor any information which the Funds
receive about the Company’s financial condition or any ciroumstances bearing on its ability to perform.

uso the Funds for all cost and attorney's feos, which

16, Expenses, Tho undersigned agrees to pay and reimb
f the Company’s Obligations under the Nofe.

they may expend or incur in the enforcement of this Guaranity or any 0:

11, Delay, Cumulative Remedies, No delay or failure by the Funds to exercise ary right to remedy against the
Company ot Guarantor will be construcd as a walver of that right or remedy. All remedies of the Funds against the

Company and the Guarantor are cumulative.

12. Binding Effect, This guaranty shall inour to the benefit of and may be enforced by the Funds, and shall be
binding upon and enforceable against the Guarantor and Guarantor’s heirs, legal representatives, successors and
assigns, In the event of the death of the Guarantor, the obligations of such deceased Guarantor shall continue in Aut
force and offect against his estate, personal representatives, successors and assigns. Without limiting the generality of
the foregoing, the Funds (or their successors and assigns) may from time to time and without notice fo undersigned,
assign any and all of their rights under this Guaranty without in any way affecting or diminishing the obligations of the
undersigned hereunder, who shall continue to remain bound by the obligated to perform under and with respect to this
Guaranty as though there had been no such assignment.

13. Default, The Guarantor hereby authorizes irrevocably any attorney of any court of record to appear for
hjnvher in such court, at any tine after ten (10) days notice after default in any payment due under this Guaranty, and
confess judgement against Guarantor, after service of notice of the claimed default, in favor of the Funds for such

2


. es LAE mg ODOM

30] HEARQUARTERS OF i)
a “ Construction & General Laborers’
District Council of Chicago and Vicinity

Atilléted with the Laborers international Union af North America, A.F. of L. + C.,0.—
6121 WEST DIVERSEY AVENUE - CHICAGO, ILLINOIS 60630 « PHONE: 773-237-7837 - FAX: 778-207-3417

LOCALS 1, 2, 4, 8, 8, 26, 75, 78, 08, 118, 149, 182, 225, 260, 288, 582, 681, 1001, 1006, 1005, 1092 © cape vt

INDEPENDENT CONSTRUCTION INDUSTRY
COLLECTIVE BARGAINING AGREEMENT

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PLOVER sae 0 13 Dun py un Ba Colca Svaing Aah HEALTH AND WELFARE DEPARTMENT OF
Prenat AND ae ae Sane atari ean itaadaens ri nS PEO at "aN he CENSTRUCION AND HERA LAO

STRICT COUNCIL FCHCAGD AN. VC TRUST. FUND, ue CHICA (LECET), and
foes und bel nda, ad tte bad yc be consid «py big thar Te raisins at i
hd soma fo fecal be hae ts Whe shal,

Amsncimeats Unereto. The EMPLOYER ratihoa and copfiems | soar nt oF the EMPLOYER Truste
ogefher wih tolr-cucenso tens, denigrate In ma none ‘feumants ang Dacaraon of Tossed Jamy whan el pero Tresens appoatag 9Y

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wie lane th UPLOVEN Toe geass Hames

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tae ay ich cea pura ube na cern hy eno a ae caved tha Moai sg, es
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eof ty ON, al it bang ofa eh ain en prot oe asd bait nay ean
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‘nab any att en, lodged 9 eo eal

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‘e * Alatea botwotn wage ad tinge bet by ts Urlon nh toa ceo
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irovocsbe Trapt naan ener yr ren tad sean sto 8
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ADDENDUM A

RECORDS REQUIRED TO BE RETAINED BY EMPLOYERS
AND PRODUCED FOR AUDITS

The following records shall be maintained and retained by all contributing employers to
the Benefit Funds for at least six years from the contribution date and shall be produced for
inspection and copying by an auditor of the Benefit Funds upon written request:

1. Quarterly and annual payroll tax returns, including, but not limited to, federal
quarterly form 941's, federal annual form W-2's, W-3's, 940's, 1099's and state quarterly

unemployment returns (form UC-3).

2. Payroll journals and/or registers which include or identify employees’ social security
numbers, hourly rates of pay, hours worked and the time period in which the work was
performed,

3, Individual earnings records for all employees of the employer not shown on payroll

journals or registers, including social security number and work classification (or code or clock
or ID number), hourly rates of pay, hours worked and the time period in which the work was

performed.
4, Cash disbursement journals and general ledgers.

5. Copies of all contribution reports and proof of payment (canceled checks or records of
canceled checks) of all contributions to the Laborers’ Funds and to all other trade union fringe

benefit funds to which the employer contributed.

6. Copies of all dues records and proof of payment (canceled checks or records of
canceled checks) of all union dues submitted to the Laborers' District Council. ,

7. Records showing all amounts paid to ail persons or entities that performed work for
the employer as independent contractors or subcontractors, if any, including copies of any

federal form 1099's issued by the employer.

8. Daily time records filed by employees or supervisors.

9. Source documents and lists of job codes and equipment codes.

10. Certified payrolls for public sector jobs where such payrolls are required.

11. Employee personnel files including, but not limited to, last known addresses and
telephone numbers, any documents which demonstrate employees’ job classifications and/or

status as an apprentice, journeyman, foreman, superintendent, or supervisor. (Confidential
medical records or other private records not relevant to the establishment of an eniployce’s job

classification shall not be disclosed.)


offered & security interest, Gramor will provided Creditor with such loss payable or other endorsements as
Creditor may require. If Grantor at any time fails to obtain or maintain any insurance as required under the
Agreement, Creditor may (but shall not be obfigated te) obtain such insurance as Creditor deems
appropriate, including if il so chooses “single interest insurance,” which will cover only Creditor’s interest
in the Collatoral,

Application of Insurance Procceds. Grantor shal) promptly notify Creditor of any loss or damage to che
Collateral. Creditor may make proof of Joss if Grantor fails to do so within fiftcen (15) days of the
casualty. All proceeds of any iusurance on the Callatera), including acccued proceeds thereon, shall behetkl
by Creditor as part of the Collateral. If Creditor consents (o repair or replacement of the damage or
destroyed Collateral, Creditor shall, upon satisfactory proof of expenditare, pay or reimburse Grantor from
the proceeds for the reasonable cost of repair or restoration, H' Creditor does not consent ta repair or
replacement of the Collaterat, Creditor shall return a sutficient amount of the proceeds to pay all of the
indebtedness, and shal! pay the balance to Grantor. Any proceeds which have aot been disbursed within
(6) months after their receipt and which Grantor has not committed to the repair ar restoration of the
Collateral shail be used to prepay the indebtedness.

Insurance Reserves, Creditor may require Grantor to maintain with Creditor reserves for payment of
insurance premiums, which reserves shall be created by monthly payments from Grantor of a sun
estimated by Creditor to be sufficient to produce, at least fifteen (15) days before the premium due date,
amounts al least equal to the insurance premiums to be paid, If fikeen (15) days before payment is due, the
reserve funds are insufficient, Grantor shall upon demand pay any deliciency to Creditor. The reserve
funds shall b¢ hold by Creditor as a general deposit and shall constitute & non-interest-bearing-account
which Creditor may sutisfy by payment of the insurance premiums required to be paid by Grantor as they
become duc. Creditor does not hold the reserve funds in trust for Grantor, and Creditor is not the agent of
Grantor for payment of the insurance premiums required to be paid by Grantor. The responsibility for
payment of premiums shall remain Grantor's sole responsibility,

Insurance Reports. Grantor, upon request of Creditor, shall furnish to Creditor reparts on cach existing
policy of insurance showing such information as Creditor may reasonably request including the followin,
(a) the name of the insurer; (b) the risks insured; (¢) the amount of the policy; (a) the property insured; (6)
the then curcent value on the basis of which insurance has been obtained and manner of determining that
value; and (f) the expiration date of the policy. In addition, Grantor shall upon request by Creditor have an
independent appraiser satisfactory lo Creditor determine, us applicable, the cash value or replacement cost
of the Collateral,

GRANTOR'S RIGHT TO POSSESSION AND TO COLLECT ACCOUNTS. Until default on the nstallment
Note and except as otherwise provided below with respect to accounts, Grantor may have possession of the tangible
personal praporty and beneficial use of all the Collateral and may use it in any lawful manner aot inconsistent with
this Agreement or the Related Documents, provided that Grantor's right to possession and beneficial use shal] not
apply to any Collateral where possession of the Collateral by Creditor is required by law to perfect Creditor's
security interest in such Collateral. Until otherwise notified by Creditor, Grantor may collect any of the Collateral
consisting of accounts, At any line and even though no Event of Qetault exists, Creditor may exercise its rights (o
collect the accounts and to nolify account debtors to uuske payments directly to Creditor for application ta the
Indebtedness. ff Creditor at any time has possession of any Collateral, whether before or ater an Event of Defauh,
Croditor shall be deemed (6 have exercised reasonable care in the custody and preservation of the Collateral if
Creditor takes such action for that purposes as Grantor shall request or as Creditor, in Creditor’s sole discretion,
shall deem appropriate under the circumstances, but (aihure to honor any request by Grantor shall not of itself be
nable care. Creditor shall nol be required to luke any steps necessary to
against prior parties, not to protect, preserve or maintain any security interest

deemed 10 be a failure to oxereise
preserve any rights in the Collatera
given to secure the indebtedness,

EXPENDITURES BY CREDITOR. If not discharged ar paid when due, Creditor may (but shall not obligated 10)
discharge or pay any nmounts required to be discharged or paid by Grantor under this Agreement, including without
limitation all ta: liens, security interest, encumbrances, and other claims, at any time levied or placed on the.
Collateral, Creditor also may (but shal} not be obligated 10) pay all costs for insuring, maintaining and preserving



forfeiture proceedings, in an amount determined by Lender, in its sole discretion, as being an adequate
reserve or bond for the dispute,

Events Affecting Guarantor, Any of the preceding events occurs with respect ta any Guarantor of any of
the Indebtedness or such Guarantor dies ar becomes incompetent. Creditor, at ity option, may but shall not
be required to, permit the Guarantor’s estate to assume unconditionally the obligations arising under the
guaranty in a manner satisfactory to Creditor and, in doing so, cure the Event of Default,

Adverse Change, A material adverse change occurs in Grantor's financial condition, ar Creditor believes
the prospect of payment or performance of the indebtedness is impaired.

Insecure.

Insecurity, Lender, in good faith, deems its

Right fo Cure, Pany default, other than a Default in Indebtedness, is curable and if Grantor has not been
given a prior notice of a breach of the same provision of this Agreement, if may be cured (and no Lvent of
Default will have occurred,), if Grantor, after Creditar sends written notice demanding cure of such default,
(a) ouves the default within five (3) days, or (b) if the cure requires more than five (5) days, immediately
initiates steps which Creditor's deems in Creditor’s sole discretion to be sufficient to cure the default and
thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as
soan as reasonably practical.

RIGHTS AND REMEDIES ON DEFAULT. Ifan Event or Default occurs under this Agreement, at any time
therealter, Creditor shall have all the rights of a secured party under the Ilinois Uniform Commercial Code. in
addition and without limitation, Creditor may exercige any one or more af the following rights and remedies.

Accelerate Indebtedness. Creditor may declare the entire indebtedness, including any prepayment penalty
which Grantor would be required to pay, immediately du¢ and payable, without notice.

Assemble Collateral. Creditor may require Grantor to deliver to Creditor all or any portion of the
Collateral and any and all certificates of title and other documents related to the Collateral. Creditor may
requite Grantor to assemble the Collateral and make it available to Creditor ata place to be designated by
Creditor, Creditor atso shall have full power to enter upon the property of Grantor to take possession of
and remove the Collateral. Ifthe Collateral contains other goods not covered by this Agreement at the time
of repossession, Grantor agrecd Creditor may take such other goods, provided the Creditor makes
reasonable efforts to return them to Grantor afer repossession,

Sell the Cottateral, Creditor shalt have full power to sell, lease, transfer, or atheewise deul with the
Collateral or proceeds thereof in its own name og that of grantor, Creditor may sell the Collateral at public
auction or private sale, Unless the Collateral threatens to decline speedily in valac or is of a (ype
customarily cold on a recognized market, Creditor will give Grantor reasonable notice of the time afer
which any private sale or any other intended disposition of the Collateral is to be made. The requirements
of reasonable notice shall be met if sucts notice is given at least ten (10) days before the Lime of the sale or
disposition, All expenses relating to the disposition of (he Collateral, in ing wilhout limitation the
expenses of retaking, holding, insuring, preparing for sale and selling the Collateral, shall become a part of
the indebtedness secured by this Agreement and shall be payable on demand, with interest at the Note rate
from dare of expenditure until repaid,

Appoint Receiver. To the extent permitied by applicable law, Creditor shall have the following rights and
remedies regarding, the appointment of a receiver; (a) Creditor may have a receiver appointed as a matter of
right, (b) the receiver may be an employee of Creditor and may serve without bond, and (c) all fees of the
receiver or his or her attorney shall become part of the Indebtedness secured by this Agreement and shall be
payable on demand, with interest at the Note rate trom the date of expenditure until repaid.

Collect Revenues, Apply Accounts, Creditor, cither itself or through a receiver, may collect the
payments, rents, income, and revenues from the Collateral, Creditor may at any time in its discretion
transfer any Collateral into it own mame ar that of its nominee and receive the payments, rents, income, and



revenues therefrom and hold the same as security for the Indebtedness or apply it to payment of the
Indebtedness in such order of preference as Creditor may determing. Insofar as he Collateral consists of
accounts, general intangibles, insurance policies, instruments, chattel paper, chases in action, or similar
property, Creditor may demand, coftect, receipt for, settle, compromise, adjust, sue for foreclase, ar realize
on the Collateral as Creditor may determine, whether or not Indebtedness or Collateral is then due, Vor
these purposes, Creditor may, on behalf of an in the name of Grantor, receive, open and dispose oF mail
addressed to Grantor, change any address to which mail and paynients are to be sent; and endorse notes,
checks, drafts, money ordors, documents of titic instruments and items pertaining to payment, shipment, or
storage of any Collateral. To facilitate collection, Creditor may notify accounts debtor and obligors on any
Collateral to make payments directly to Creditor,

Obtain Deficiency. If Creditor chooses to sell any or all of the Collateral, Creditor may obtain a judgment
against Grantor for uny deficioncy remaining on the Indebtedness due to Creditor after application or all
reise of the rights provided in this Agreement, Grantor shail be liable for a
subscclion is a sale at accounts or chattel paper.

amounts received from the ex
deficiency even if the transaction described in this

Other Rights and Remedies. Creditor shall have alf the rights and remedies of a secured creditor under
the provisions of the Uniform Commercial Code, as may be amended from time (© time. In addition,
Creditor shall have and may exercise any or afl other rights and remedies it may have available at law, in

equity, or otherwise.

Cunulative Remedies. All of Creditor’s rights and remedies, whether ovidenced by this Agreement or the
Related Documents or by any other writing, shall be cumulative and may be exercised singularly or
concurrently. Election by Credilor (o pursue any romedy shall not exclude pursuit of any other remedy, and
an election to make expenditures or to take action to perform an obligations of Grantor under this
Agreement, after Grantor’s failure to perform, shall not affect Creditor right 0 declare a default and to

exercise ils remedies,

MISCELLANEOUS PROVISIONS. The following miscellaneous provides are a patt of this Agreement

Amendments, ‘This Agreement, together with the Note, Guaranty of Payment and fodemuaification and any
Related Documents, constitutes the entire understanding and agreement of the partics as to the matters set
forth in this Agreement. No alteration of or amendment to this Agreement shall be effective untess given in
writing and signed by the party or parties sought o be charged ar bound by the alteration or anendment,

Applicable Law. ‘This Agreement has been delivered to Creditor and accepted by Creditor in the State of
Nhinois. If there is a lawsuit, Grantor agrees upon Credilor’s request 0 submit to the jurisdiction of the
courts of the State of Minvis. This Agreerncat shall be governed by and construed in accordance with the
laws of the State of Ulinois.

Attorneys? ¥ees, Expenses. Grantor agrees to pay on demand all of the Creditor’s costs and expenses,
including attorneys” fees and Creditor's legal expenses, incurred in connection with the enforcement of this
Agreement, Creditor may pay someone else to help enforce this Agreement, and Grantor shall pay the
coste and expenses of such enforcement, Costs and expenses included Creditor’s attorneys’ fees and legal
expenses whether or not there is a lawsuit, including attorneys’ fees and legal expenses for bankruptcy
proceedings (and including efforts to modify or vacate any automatic stay or injunction), appeals, and any
pated post-judgment collection services. Grantor also shall pay all court costs and such additional

fcos as may be directed by the court.

Caption Headings. Caption headings in this Agreement are for convenience purposes only and are not he
used to interpret or define the provisions of this Agreement,

Multiple Parties; Corpornte Authority, All obligations of Grantor under this Agreement shall be joint
and several, anct all references ta Grantor shall mean each and every Grantor. ‘This meuns that cach of the
persons signing below is responsible for all obligations in this Agreement.


liquidated damages will be used to defer administrative costs arising by said delinquency and

acknowledge the costs to be actual and substantial though difficult to ascertain; however the

Employers acknowledge these costs to be at a minimum of 10%, waiving the necessity of
any additional proof thereof. In addition, the delinquent contributions and any payments
owed by an Employer pursuant to an installment agreement, shall bear interest up to the
prime rate of interest plus two points charged by the Fund’s custodian bank (or any other
bank selected by the Trustees) or such other lawful amount as determined by the Trustees
from the due date until totally satisfied. The Trustees are hereby given the power and
authority to delegate the collection of contributions to:a Collection Committee, which, in its
discretion, may assess a lesser or greater amount or waive or suspend payment of liquidated.
damages, interest, audit fees or investigative costs in accordance with rules and procedures
adopted by the Collection Committee and to compromise claims for delinquent
contributions and related liabilities and collection costs where appropriate to settle cases.
favorably for the Fund. The Collection Committee may include trustees of the Laborers’
Welfare Fund as members of the Committee.

In the event an Employer party ‘to this Agreement or otherwise bound thereby
becomes delinquent in his contributions or an installinent agreement, or fails to post a bond
as required, said delinquent Employer shall be liable for reasonable attomeys' fees.and for
all reasonable costs incurred in the colléction process, including court fees. audit fees,

investigative costs, etc. The term “reasonable attorneys’ fees" as used herein shall ‘mean all

-26-


Fax from +: 17889477295 LABORS FIELD DEPT 18-25-13 18:42a Pg:

3 I received a Bachelor of Arts Degree from the University of Illinois at Urbana-
Champaign in 1992 and a Juris Doctor Degree from the University of DePaul College of Law in
1995. Iwas admitted to the bar of the State of Illinois in November 1995 and to the bar of the
United States District Court for the Northen District of Illinois in December 1995. Ihave also
been admitted to the bar of the United States District Court for the Central District of Illinois. I
was admitted to the Trial Bar of the Northern District of Illinois on September 20, 2000. From
November 1995 to August 2000 I practiced labor and employment law as an associate at the law
firm of Katz, Friedman, Eagle, Eisenstein & Johnson (formerly Katz, Friedman, Schur & Eagle).
Jn September 2000, I became Fund Counsel for the Laborers’ Pension Fund and Laborers’
Welfare Fund for the Health and Welfare Department of the Construction and General Laborers’
District Council of Chicago and Vicinity.

4. Based on the foregoing, $225.00 represents a fair and reasonable market rate for
my in-house legal services to the Funds in this matter.

5. Jerrod Olszewski, in-house counsel for the Laborers’ Funds, received a Bachelor
of Arts Degree from Benedictine University in 1993 and a Juris Doctor Degree from the John
Marshall Law School in 2002. He was admitted to the bar of the State of I!linois in May, 2002,
and to the bar of the United States District Court for the Northern District of Illinois in May,
2002. From May, 2002 to December, 2004, he practiced labor and employment law as an
associate at the law firm of Katz, Friedman, Eagle, Eisenstein & Johnson, former out-of-house
counsel to the Laborers’ Funds, with the majority of his work being spent representing the

Laborers’ Funds. In December, 2004, he became in-house counsel for the Laborers’ Funds.


Fax from + 17889477295 LABORS FIELD DEPT 18-25-13 89:87a Pg:

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LABORERS’ PENSION FUND and
LABORERS’ WELFARE FUND OF THE
HEALTH AND WELFARE DEPARTMENT
OF THE CONSTRUCTION AND GENERAL
LABORERS’ DISTRICT COUNCIL OF
CHICAGO AND VICINITY, and JAMES S.
JORGENSEN, Administrator of the Funds,

Plaintiffs, Case No. 12 C 2514
YY
Judge Zagel
JACOBS & SON, INC., an Illinois corporation,
and KENNETH M. JACOBS, individually,

eS SS Sw SS en

Defendants.

AFFIDAVIT OF JAMES FOSCO

JAMES FOSCO, being first duly sworn on oath, deposes and states as follows:

1. 1am a Field Representative employed by the Laborers’ Pension Fund and the
Laborers’ Welfare Fund of the Construction and General Laborers’ District Council of Chicago
and Vicinity (hereinafter collectively referred to as the “Funds”), Plaintiffs in the above-
referenced action. My responsibilities include oversight of the collection of amounts owed by
Defendant Jacobs & Son, Inc, (hereinafter “Jacobs & Son” or the “Company”). This Affidavit is
submitted in support of the Laborers’ Funds’ Motion to Reinstate and Confess Judgment. [have

personal knowledge regarding the statements contained herein.

2. On July 29, 1998, the Company signed an Independent Construction Industry
Collective Bargaining Agreement (“Agreement”) with the Construction and General Laborers’
District Council of Chicago and Vicinity (“District Council”) and Laborers’ Local Union No.
1006. A true and accurate copy of the Agreement is attached hereto as Exhibit B-1. Pursuant to

EXHIBIT


Case: 1:12-cv-02514 Document #: 16 Filed: 11/30/12 Page 2 of 2 PagelD #:58

December 1, 2009 forward and to collect any additional unpaid contributions, dues, wages,
interest, liquidated damages or audit costs revealed as due and owing therein.

3. Further, unless a timely motion is filed to reinstate the matter before September
30, 2014, this matter shall be dismissed without prejudice to the Funds’ right to enforce the terms
of the Guaranty of Payment and Indemnification and Commercial Security Agreement against
Defendants Jacobs and Son, Inc. and Kenneth M. Jacobs on any additional liabilities that are due
or may come due under the terms of the Guaranty of Payment and Indemnification and

Commercial Security Agreement.

ENTER:

\ B. Coal
Th€ Hopbrable Judge Janiés B. Zagel
United States District Court Judge

Nov 30 202

Dated:


Valley Laborers’ Health and Welfare Fund and $8.58 per
hour to the Fox Valley and Vicinity Laborers’ Pension
Fund ($19.20 per hour in total). The Union in its sole dis-
cretion, shall determine the division of additional contri-
butions to be allocated from the economic package to the
Fox Valley Funds in future years, provided that the total
amount to be allocated is the same as the total amount
allocated to the Health and Welfare Department of the
Construction and General Laborers District Council of
Chicago and Vicinity and the Laborers Pension Fund.

Employers contributing to the Fox Valley Funds
agree to be bound by the Agreements and Declarations of
Trust establishing the Fox Valley Funds, as well as any

amendments thereto.

The parties agree that, whenever contributions are
made on behalf of an Employee to welfare and pension
funds that are not the home funds of the Employee, the
funds receiving such contributions, in accordance with
the funds’ Reciprocity Agreement, shall transfer such con-
tributions to the home funds and the home funds shall
reallocate the contributions between such home funds in
the amounts set forth herein.

Section 415 Excess Benefit Fund. A Section 415
Excess Benefit Fund shall be established for the purpose
of providing alternative benefit to any employees of the
Employer who become unable to receive the entire
amount of the accrued pension benefits to which they
would be entitled under one or more of the pension plans
sponsored by their Employer because of limitations estab-
lished by Section 415 of the Internal Revenue Code. The
Employer may be required and directed by the Board of
Trustees of the Excess Benefit Fund to contribute a por-
tion of its agreed-upon, “pension” contribution to the
Section 415 Excess Benefit Fund and shall not increase
the Employer’s cost beyond the amount that the Employer
is obligated to contribute to the Laborers’ Pension Fund
and that the funding of the Section 415 Excess Benefit
Fund shall be fully tax deductible to the Employer for

16


Fax from: 17089477295 LABORS FIELD DEPT 16-25-13 @9:47a Pg:

and Indemnification and both Kenneth M. Jacobs and the Company entered into a Commercial
Security Agreement. The Company also entered into a Contract for Cash Bond. A true and
accurate copy of the Settlement Agreement which includes the Note, Guaranty of Payment and
Indemnification, Commercial Security Agreement, and Contract for Cash Bond are attached
hereto as B-5.

6. The Company failed to submit timely installment payments due under the Note
for the period of March 2013 through August 2013 and has failed to submit the Company’s
September 2013 Installment Note payment. In addition, the Company has failed to submit and
payment benefit and dues reports for the period of August 2013 forward. Accordingly,
Defendants owe the following amounts on the defaulted Installment Note:

Unpaid and Accelerated Installments from Oct. 2013 $70,073.52
through Aug. 2014:

Accumulated liquidated damages on late-paid
Note payments from March 2013 through
September 2013 and late October 2013 Note payment: $10,192.48

TOTAL: $80,266.00
7. The Company owes a balance on the Contract for Cash Bond in the amount of
$2,500.00.

FURTHER AFFIANT SAYETH NOT,

Jantgs Fosco

Subscribed and sworn to before me
_day of October 2013.

Notary'Public

“OFFICIAL SEAL"
EUGENIA MASHOS
Notary Public, State of thinole %
mission Expires 091216 §



Fax from +: 17689477295 LABORS FIELD DEPT 18-25-13 16:43a = Pg:

November of 2006 and to the bar of the United States District Court for the Northern District in
January of 2007. In February of 2009, he became in-house counsel for the Laborers' Funds.

12. Based on the foregoing, $225.00 represents a fair and reasonable market rate for
John Hamada’s in-house legal services to the Funds in this matter.

13, Elizabeth Haley Douglass, in-house counsel for the Laborers’ Funds, received a
Bachelor of Arts Degree from Luther College in 2008 and a Juris Doctor Degree from the John
Marshall Law School in 2011. She was admitted to the bar of the state of Illinois in November
2011 and to the bar of the United States District Court for the Northern District of Ilhnois in
December 2011. In December 2011, she became in-house counsel for the Laborers’ Funds.

14. Based on the foregoing, $195.00 represents a fair and reasonable market rate for
Elizabeth Haley Douglass’ in-house legal services to the Funds in this matter.

15. Exhibit 1 attached hereto sets forth the time expended since April 2, 2013 by
Fund Counsel on this matter to enforce the obligations of the Installment Note and move to
reinstate the case.. As set forth in that Exhibit, we have expended 6.4 hours totaling $1,292.50 in
attomeys’ fees.

I, the undersigned, certify under penalty of perjury that the foregoing is true and correct.

Date: Olas es ayer Mew

Patrick T. Wallace



Jacobs & Sons

10/25/2013 PTW. Edits to Affidavit, Motion to Reinstate; Conference with J. Fosco; review of

Page 3

Hrs/Rate Amount
0.80 180.00
225.00/hr

fees.

For professional services rendered

6.40 $1,292.50

Balance due $1,292.50

Timekeeper Summary
Name Hours Rate Amount
Paralegal 0.40 100.00 $40.00
Patrick T. Wallace 2.10 225,00 $472.50

Patrick T. Wallace 3.90

200.00 $780.00


which assignment shall not be revocable for a period of
more than one (1) year, or prior to the termination date
of this Agreement, whichever occurs sooner.

Paragraph 7. The Union agrees that it will indemnify
and hold harmless the Employer from any and all claims,
suits, causes of action, or otherwise, as regards the cre-
ation and administration of the dues check-off established
by this Article and such indemnity and agreement to hold
harmless shall include the payment of costs and attorneys’
fees on behalf of the beneficiaries of such indemnity.

Paragraph 8. Should any Employer fail to remit dues
to the Union as required under this Agreement, the
Employer shall be liable for and pay all costs of collec-
tion, including reasonable audit expenses and reasonable
attorney fees and costs. The Union may file suit, or
remove employees that it represents, or both, for non-
remittance or underpayment of dues by an Employer.

Paragraph 9, Laborers Political League. The Em-
ployer will deduct an amount designated by the Union for
each hour that an employee receives wages under the
terms of this Agreement on the basis of individually
signed voluntary authorized deduction forms and shall
pay over the amount so deducted to the Laborers’ Politi-
cal League (“LPL”) or to a designated appointee, not later
than the 10th day of the month next following the month
for which such deductions were made. LPL remittances
shall include a report of the hours worked by each
Laborer for whom deductions are made. Remittances
shall be made by a separate check payable to the
Laborers’ Political League. The Employer shall be paid a
processing fee each month from the total amount to be
transmitted to the LPL to be calculated at the Illinois

Department of Revenue standard.

Article VIII
INDUSTRY FUNDS

Paragraph 1. Each Employer shall pay into the ILLI-
NOIS SMALL PAVERS ASSOCIATION (hereinafter

22


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LABORERS’ PENSION FUND and
LABORERS’ WELFARE FUND OF THE
HEALTH AND WELFARE DEPARTMENT
OF THE CONSTRUCTION AND GENERAL
LABORERS’ DISTRICT COUNCIL OF
CHICAGO AND VICINITY, and JAMES S.
JORGENSEN, Administrator of the Funds,
Plaintiffs, Case No, 12 C 2514
v.
Judge Zagel
JACOBS & SON, INC., an Illinois corporation,
and KENNETH M. JACOBS, individually,

Defendants.

MOTION TO REINSTATE AND CONFESS JUDGMENT.

NOW COME Plaintiffs Laborers’ Pension Fund and Laborers’ Welfare Fund of the
Health and Welfare Department of the Construction and General Laborers’ District Council of
Chicago and Vicinity and James S. Jorgensen, Administrator of the Funds (hereinafter
collectively “Funds”), by and through their attorney, Patrick T. Wallace, and hereby move this
Court to reinstate the case and enter an Order enforcing the Settlement Agreement entered into
by the parties in the above-captioned matter. In support of this Motion, Plaintiffs state as
follows:

1, The parties reached settlement in this case and entered into an Installment Note
(“Note”), Guaranty of Payment and Indemnification, Commercial Security Agreement and
Contract for Cash Bond. The Settlement Agreement and Stipulation to Dismiss was filed by the
parties requesting that the Court dismiss the matter without prejudice retaining jurisdiction to

enforce the terms of the Settlement Agreement up and through September 30, 2014. The Court


LABORERS’ PENSION AND WELFARE FUNDS
POLICY FOR RETENTION AND PRODUCTION OF EMPLOYER RECORDS

As Adopted by the Boards of Trustees
Effective as of April 1, 2006

WHEREAS, Section 209 of the Employee Retirement Income Security Act of 1974 , as
amended ("ERISA"), 29 U.S.C. Section1059, requires employers obligated to contribute to
employee benefit funds to maintain records with respect to its employees which are sufficient to
determine benefits due to such employees of which may become due to them; and

WHEREAS, the Trustees of the Laborers' Pension Fund and the Trustees of the Health
and Welfare Department of the Construction and General Laborers’ District Council of Chicago
and Vicinity (collectively, the “Benefit Funds”) have the authority under their respective Trust
Agreements to establish rules, regulations and policies regarding records which must ‘be
maintained by employers in order to administer the Benefit Funds; and

WHEREAS, the Trustees of the Benefit Funds have found that most contributing
employers maintain proper records and make all required contributions to the Benefit Funds,
nevertheless, there are employers who are bound by the Trust Agreements of the Benefit Funds
who fail to maintain records which are adequate for the Funds to determine whether proper
contributions have been made on behalf of eligible employees and that some of such employers
do so deliberately in order to avoid their obligations to make such payments; and

WHEREAS, the practices of employers who fail to maintain records sufficient to enable
the Benefit Funds to conduct thorough payroll audits cause their employees to lose valuable
pension and welfare benefits and cause the Benefit Funds to lose contractually tequired
contributions and investment earnings on those contributions; and

WHEREAS, the practices of employers who fail to maintain adequate records cause the
Benefit Funds to incur substantial additional administrative and legal expenses in order to
determine proper amounts owed to the Funds by such employers; and

WHEREAS, enforcement of a policy specifying the records required to be maintained
and produced increases the ability of the Funds to prove the contributions owed by delinquent
employers and thereby to provide proper credit to the employees and their beneficiaries;

NOW THEREFORE, the Trustees resolve that the following policies are adopted by the
Benefit Funds effective as of March 1, 2002:



Article V
WAGES

Paragraph 1. The rates of wages exclusive of fringe
benefits to be paid in this trade for the period June 1,
2010 to and including May 31, 2013, shall be as set forth
below for the respective following classifications as fur-
ther defined herein.

The wage rates include a total economic increase of
$1.75 per hour effective June 1, 2010 to May 31, 2011
(to be allocated to fringe benefits only by the Union in its
sole discretion) for a wage rate of $35.20 per hour, which
includes the dues deduction; June 1, 2011 to May 31,
2012, $1.80 per hour total economic increase to be allo-
cated to fringe benefits only by the Union in its sole dis-
cretion; June 1, 2012 to May 31, 2013, $1.85 per hour
total economic increase to be allocated between wages,
fringe benefits and other funds by the Union in its sole
discretion; The foregoing allocations may include alloca-
tions to LECET and LDC/LMCC,

CLASSIFICATION 6/01/10 6/01/11 6/01/12
Laborers and Helpers ........... $35.20 $1.80* $1.85**
Rakers and Lutemen............. 35.475

Machine-Screwmen ............. 35.475 —*tg_be allocated to
Asphalt Tampers and Smoothers ...35.475 _ fringe benefits only by
Kettlemen ................0000. 35.475 the Union in its sole
Mixermen ..........00 eee eee eee 35.475 discretion

Drum-Men ...........ccc ceca ee 35.475 (See above paragraph)
Jackhammermen (Asphalt) ........ 35.475 :
Paintmen ........ 2. cece eee ee 35.475

Mitre Box Spreaders ............. 35.475  **to be- allocated be-
Laborers on Birch, Overman and hina benathe b ane
Similar Spreader Equipment ...... 35.475 Union in ts Se dis.
Laborers on Apsco ...........4.. 35.475 cretion

Laborers on Air Compressors ..... 35.475 (See above paragraph)
Material Expeditor. (Asphalt

Plant Laborers) .............04. 35.20

Paving Form Setters ............. 35.475

Jackhammerman (Concrete) ...... 35.475


JUNE 1, 2010 TO MAY 31, 2013

AGREEMENT

between the

ILLINOIS SMALL PAVERS ASSOCIATION

and the

CONSTRUCTION AND GENERAL LABORERS’
DISTRICT COUNCIL
OF CHICAGO AND VICINITY

iB-Z


GUARANTY OF PAYMENT AND INDEMNIRICATION

This Guaranty (“Guaranty”) is made as of August 29%, 2012 _ by the undersigned,
econ Hee REh Jacobs (the “Guarantor”, to and for the benefit of the LABORERS! PENSION FUND
AND THE LABORERS’ WELFARE FUND OF THE HEALTH AND WELFARE DEPARTMENT OF THE
CONSTRUCTION AND GENERAL LABORERS" DISTRICT COUNCIL OF CHICAGO AND VICINITY,
THE CONSTRUCTION AND GENERAL LABORERS? DISTRICT COUNCIL OF CHICAGO AND
VICINITY (the “District Council”) and any retated ancillary Funds (0 which Jacobs & Son, Ine. is obligated to pay
contributions to by virtue of its Agreement with the District Council and the Funds’ respective Agreements and
Declarations of Trust (collectively the “Funds"). .

WHEREAS, Jacobs & Son, Ing, (the “Company") has agrocd to pay: a total of $165. 726,34 to the Funds in
settlement of the alleged delinquent contributions owed to the Fands and to be paid under the terms of 2 Settlement

Agreement and Installment Note (“Note”).

WHBRBAS, the Punds are unwilling to enter into the Note unless the Guarantor executes this Guaranty: and
WHEREAS, the Guarantor has a financial interest in the Company and will be benefited by the Note:

NOW THEREPFORBWHERBAS, in consideration of the foregoing, the Guarantor agrees as follows:

1, Guaranty of Payment and Indemnification. The undersigned guarantees, absolutely and unconditionally:

(a) the payment when due of the entire principal indebtedness and all interest evidenced by the Note during the tventy-
four (24) month payment period including interost and Uquidated damages for fate or unpaid payments due on the
Note; and (b) the full and complote payment of any and all fees und costs incurred pursuant to default ander terms of
the Note, whether Hugation is Involved or not, and if Involved, whother at the ria} or appellate levels or In pre- or post
judgment bankruptcy proceedings in enforcing or realizing upon the obligations of the Guarantor hereundes (the
obligations of Guarantor under this Paragraph 1 are collectively hereinafler referred to as the “Obligattoas”). The
Guarantor also agrees to be personally Vable for all monthly benefit convibutions, union dues and/ar wages owed from
the Company to the Funds, the District Council, all ancillary finds, and/or the partichpaats that are due at the time the
Note and Guaranty are entered into and/or are incurred and booome due and owing for the duration of the Note,
including all interest, liquidated damages, audit costs, attorneys® fees and costs,

2, Continuing Guaranty. This Guaranty shal} be a continuing Guaranty, and shall not be discharged, invpaired
or affeoted by; (a) the existence or continuance of any obligation on the part of the Company with respeot to the Note;
(v) any forbearance or extension of the time of payment of the Note; (¢) the validity or invalidity of the Note; (d) any
defenses whatsoever that the Company or any of the party thereto may ‘have to the performance or observanve af any
term, covenant or condition contained in the Note; (©) the existence or non-existence of the Company as a legal entlty;
(6) any limitation or exculpation of (other than the payment and performance in full of all of the Company's
Obligations) that Guarantor may have as to his undertakings, Habilities and obfigations hereunder, including any
defenses based upon any legal disability of the Company ot any discharge or timitation of the disability of the
Company, whether consensual or arising by operation of law or any pankruptey, insolvency or deblor-relief
proceeding, or from any thor catise, each and every such defense being hereby waived by the Guarantor.

presentment, profest, notice of dishonor, demand for payment,

3, Waivers, Guarantor waives diligence, 1
non-payment at maturity and indulgences and

extension of time of payment, notice of acceptance of this Guaranty,
notices of every Kind not provided for under this Guaranty. It is the intention of this Guaranty that Guarantor shall
remain tinble 23 principal, notwithstanding any act, omission or thing that might otherwise operate us A jegal or
equitable discharge of Guarantor, weotil all of the Company's obligations shall have been fully paid and performed.

4. Subrogation, Notwithstanding anything to the contrary elsewhere contained herein or in the Note, the

Guavantor(s) expressly walve with respsct to the Company any and all rights at law or in eguity to subrogation, to
reimbursement, to exoneration, to contributton, to set oft or to any other rights that could accrue (0 0 surety against a

1

IBIT


ARTICLE VI
EMPLOYER CONTRIBUTIONS

Section 1, IN GENERAL, In order to fund the Benefits provided for by this Agreement,
each. Employer, for the period that it is obligated by a Written Agreement, shall make
contributions to the Trustees pursuant to regulations established by the Trustees at the times
required by that agreement. The rate of contributions shall be determined by the applicable
Collective Bargaining Agreements or Participation Agreements, together with any amendments,
supplements or modifications thereto. Notwithstanding the preceding sentence, if an Employer is
required to make contributions by reason of a Participation Agreement or, other Written
Agreement that is not a Collective Bargaining Agreement, the amount of its contributions shall
be not less than the amount required by the Collective Bargaining Agreement in effect between
the Employer Association and the Union having jurisdiction over the geographic area in which
the covered Employees perform their work. No Employee shall be permitted to contract or
otherwise agree with or permit his Employer to provide ‘wage or benefit payments which do not
conform with the amount of contributions required under the foregoing provisions of this Section
and any such Contract or agreement shall be null and void. It shall not be a defense to any claim
by the Trustees or an Employee for payment of delinquent contributions from an Employer that
such Employer had entered into an agreement with any Employee purporting to waive the
Employee’s right to strict compliance with the provisions of the applicable Collective Bargaining
Agreement or a Participation Agreement. All contributions shall be paid in the manner and form

required by the Trustees.

Section 2, DEFAULT IN PA’ NT_OF CONTRIBUTIONS. Nonpayment by an
Employer of any contributions when due shall not relieve any other Employer of his obligation to
make payments. The Trustees may take any action necessary to enforce payment of the
contributions and penalties due hereunder, including, but not limited to, proceedings at law and
in equity. Any such action shall not prejudice the Union in any action it may wish fo take on
account of such nonpayment. The Trustees are authorized to establish a reasonable and lawful
grace period by which contributions must be received; Employers making contributions that are
hot received before the expiration of said period. and any Employer making tate payments due
under an installment agreement shall be assessed liquidated damages of 10% of the amount of the
contributions which are, owed.- All Employers party to or otherwise bound by this Agreement
acknowledge that the liquidated damages will-be used to defer administrative costs arising by
said delinquency and acknowledge the costs to be actual and substantial though difficult to
ascertain; however the Employers acknowledge these costs to be at a minimum of 10% waiving

the necessity of any additional ‘proof thereof, In addition, the delinquent contributions and any
payments by the Employer pursuant, to an installment agreement, shall bear interest, up to the

prime rate plus two points, charged by the-Fund’s custodian bank (or any other bank selected by
’ the Trustees) or such-other lawful amount as determined by the Trustees from the due date until
totally satisfied. The Trustees are hereby given the power and authority, in their discretion, to
assess a lesser amount or to waive or suspend payment of liquidated damages, interest, audit feés
or investigative costs in accordance with rules and procedures adopted by the Collection
Committee of the Board of Trustees and to compromise claims for delinquent contributions and
related liabilities and collection costs where appropriate to settle cases favorably for the Welfare

15

N


Laborers Pension and Welfare Funds

11465 Cermak Rd.

Westchester, IL 60154

Invoice submitted to:

Jacobs & Sons

October 25, 2013

Invoice #10279

Professional Services

4/2/2013 PTW

4/3/2013 PTW

4/10/2013 PTW

4115/2013 PTW

4/17/2013 PTW

4/19/2013 PTW

5/15/2013 PTW

5/28/2013 PTW

6/7/2013 PTW

6/11/2013 PTW

Conference with J. Fosco re: Note.

Letter to T. Miller; edits; review of Note payments.

Telephone call to J. Fosco; telephone call to T. Miller; review of fax.
Telephone conference with T. Miller; memo to file re: same.
Telephone conference with T. Miller; Telephone conference with JF;

Telephone conference with T. Miller.

Text to T. Miller; Conference with J. Jorgensen; Conference with J. Fosco;
telephone call to T. Miller; Conference with J. Fosco.

Telephone conference with T. Miller, memo to file re: same.

Telephone conference with T. Miller.

Telephone conference with T. Miller.

Telephone conference with T. Miller; Telephone conference with T. Miller.

Hrs/Rate Amount
0.10 20.00
200.00/hr
0.20 40.00
200.00/hr
0.20 40.00
200.00/hr
0.10 20.00
200.00/hr
0.30 60.00
200.00/hr
0.40 80.00
200.00/hr
0.10 20.00
200.00/hr
0.10 20.00
200,00/hr
0.10 20.00
200.00/hr
0.20 40.00
200,00/hr
EXHIBIT

iC]


other information as the Trustees may reasonably require in connection with the
administration of the Trust and Pension Plan. The Trustees may at any time have an audit
made by an independent certified public accountant or its representatives of the payroll of
any Employer in connection with the said contributions and/or reports. All Employers shall
be required to maintain records in compliance with procedures developed and communicated
by the Administrator from the beginning of such Employer’s participation in the Pension
' Fund forward unless given written authorization by the Administrator upon request to
destroy said record. The ‘Administrator shall require the Employer to designate the
classification of all of his employees and if the Employer fails to do so, the Trustees shall
conduct an investigation for the purpose of determining the classification of such employees
and the results of said investigation shall be conclusive. Attached hereto as Addendum A

are the current collection policies concerning Scheduling of Audits and Retention and

Production of Employer Records adopted by the Trustees.

ARTICLE VII

FILING CLAIMS AND REVIEW OF DENIALS OF CLAIM

Section]. FILING OF A CLAIM. Claims for the payment of any benefits

provided by the Pension Plan shall be filed, in writing, in accordance With the Rules and

Regulations set forth in Article 7 of the Pension Plan.

~28-


1. Except as otherwise provided herein, all contributing employers to the Benefit Funds
shall maintain and make available for inspection and copying by an auditor of the Benefit Funds
the records listed on Appendix A, attached hereto.

2. Any employer obligated to contribute to the Benefit Funds who fails to maintain and
make available for inspection and copying to an auditor of the Benefit Funds the requisite
records listed on Appendix A shall bear the burden of proof with respect to the exclusion of any
employee from coverage by the collective bargaining agreement with the Union. In those cases
where an employer asserts that an employee is excluded because he/she is a member of another
bargaining unit, the employer must submit tangible evidence of that fact, e.g. a union
membership card, contribution records maintained for the benefit funds of the other bargaining
unit, commercial drivers’ license if it is asserted that an employee is.a truck driver rather than a
laborer and workers’ compensation policies, forms and applications listing an employee's job
classification or other business records. The affidavit of an employer’s representative or officer
unsupported by documentary evidence shall not be sufficient to meet the employer’s burden of
proof, Affidavits solicited and obtained ex parte by an employer’s representative from
employees, for which there is no corroborative evidence in the form of records maintained in the
ordinary course of business, shall not be sufficient to meet the employer’s burden of proof.

3. When an employer has failed to maintain or make available the requisite records, there
shall be a rebuttable presumption that any employee listed as a possible laborer by an auditor,
Field Representative or attorney representing the Benefit Funds was a laborer. There shall also
be rebuttable presumptions concerning the hourly rate and number of hours worked as follows:
(a) that the employee was paid only $10.00 per hour if no record of wage rates was made by the
employer, and/or (b) that the employee worked 72 hours per week if no record of the number of
hours was maintained; whichever of these presumptions results in the higher amount of
contributions shall be applied, When evidence exists that a different hourly rate was paid to
employees of an employer that failed to maintain the required records, at the discretion of the
Director of the Field Department, a different hourly rate may be presumed for purposes of
determining the amount of contributions owed by the employer. If that evidence shows that the
employer paid a rate lower than $10.00 per hour to any employees doing bargaining unit work,
then that lower rate shall be presumed to be the actual rate paid to all employees for whom
adequate records were not kept. Similarly, where evidence exists of a different number of hours
worked, the Director may apply a different number of hours for determining the contributions
owed, and this number of hours worked shall be presumed correct. All wages computed as
provided in this paragraph shall be presumed to be paid as straight time wages regardless of the
number of hours worked unless the employer has provided documentation, in the form required
by the terms of this policy, showing that it followed the requirements of the Fair Labor Standards
Act and/or the applicable collective bargaining agreement as to the payment of overtime.

4. An employer that fails to maintain the requisite records and fails to cooperate with the
Trustees in establishing the paid wage rates, actual hours of work and contributions owed to the
Benefit Funds shall be liable to the Benefit Funds and any related organizations, for the
contribution amounts determined as provided herein and also for 20% liquidated damages,
compound interest at the rate of prime plus 2 points (as determined by the Administrator),
auditor’s and attorney’s fees and any other expenses of collection including investigative costs.



attorneys’ fees in the amounts for which the Trustees become legally obligated including

recovery of liquidated damages, audit costs, filing fees and any other expenses incurred by

the Trustees.

The Trustees are hereby given the power and authority, in their discretion, to require
any Employer to deposit with the Trustees, in advance, as a guarantee for the payment of
monthly contributions, an amount equal to three (3) times the monthly contributions ofsuch
Employer, as estimated by the Trustees. At the option of the Trustees the Employer shall
furnish the. Trustees, in lieu of any cash deposit, a bond in an amount not less than Five
Thousand Dollars ($5,000.00) or in an amount consistent with thie terms of the current
collective bargaining agreements. In the event an Employer is repeatedly delinquent in its
contribution payments to the Pension Fund, the Trustees have the power and authority to
require that Employer to purchase a bond in excess of $5,000.00 or the amounts set forth in
the current collective bargaining agreements, in an amount equal to three (3) times the

: highest monthly contributions of the Employer in the twelve months prior to any
delinquency. The Trustees, in their discretion, may also waive the requirement of a cash
deposit or a surety bond in lieu of a personal guaranty when such waiver is warranted.

Section3. REPORT ON CONTRIBUTIONS AND PRODUCTION OF

RECORDS. The Employers shall make all reports on contributions required by the Trustees.

Each Employer shall promptly furnish to the Trustees. on demand. the names of its

employees, their social security numbers, the hours worked by each employee, and such

-27-


Maintenance and Inspection of Collateral. Grantor shall maintain all tangible Collateral in good
condition aud repair. Grantor will not commit or permit damage to or destruction of the Collateral or any
part of the Collateral. Creditor and its designated representatives and agents shall have the right at all
reasonable times fo exumine, inspect, und audit the Collateral wherever located. Grantor shafl immediately
notify Creditor, of all cases involving the return, rejection, repossession, toss ar damage of or (o any
Collateral; of any request for credit or adjustment or of any other dispute arising with respect to the
Collateral; and generally of all happenings and events affecting the Collateral or the value or the amount of

the Collateral,

‘Taxes, Assessments arid Liens, Grantor will pay when due all taxes, assessments and fiens upon the
Collateral, ils use or operation, upon this Agrecinent, upon any promissory note or otes evidencing thy
indebtedness, or upon any of the other Related documents, Grantor may withhold any such payment or
may elect to contest any lien if Grantor is in yood faith conducting, an appropriate proveeding to contest the
obligations fo pay and so long as Lender's interest fa the Collateral is nol jeopardized in Creditor's sole
opinion. Ifthe Collateral is subject to a lien which is not discharged within fifteen (15) days, Grantor shall
deposit with Creditor cash, a sufficient corporate surety bond or other security satisfactory to Creditor in
any amount adequate to provide for the discharge of the lien plus any interest, costs, attomeys’ fees or other
charges that could accrue as a result of foreclosure or sale of the Collateral. In any contest Grantor shall
defend itself and Creditor and shall satisfy any final adverse judgment before enforcement against (he
lateral. Grantoy shall name Creditor as an additional obligee under any surety bond furnished in the

contest proceedings.

Compliance with Governmental Regulations, Grantar shall comply promptly with alt laws, ordinances,
rules and regulations of all governmental authorities, now or hereafter in effect, applicable tot he
ownership, production, disposition, or use of the Collaterat. Grantor may contest in good faith any such
law, ordinance or regulation and withhold compliance during any proceedings, including appropriate

appeals, so long as Creditor’s interest in the Collateral, in Creditor’s opinion, is not jeopardized.

Hazardous Substances, Grantor represents and wacrants that the Collateral never has been, and never will
be so long as this Agreement remains a Jicn on the Collateral, used for the generation, manufacture, stornge,
transportation, treatment, disposal, release or threatened release of any hazardous waste or substance, as
those terms are defined in the Comprehensive Environmental Response, Compensation, and Liability At of
1980, as amended, 42 U.S.C, Section 9601, et seq. (“CERCLA”), the Superfund Amendments and
Reauthorization Act of 1986, Pub, L, No., 99-499 ("SARA"), the Hazardous Materials Transportation Act,
49 U.S.C. Section 1801, ef seq, the Resouree Conservation and Recovery Act, 42 U.S.C. Section 6901, et
¢., or ather applicable state or Federal laws, rWes, or regulations adopted pursuant (o any of the
foregoing. The terms “hazardous waste” and “hazardous” substance” shall also include, without limitation,
pelsateuin and petroleum by-products or any fractions (hereof and asbestos, ‘The representations and
warranties contained herein ave based ou Grantor’s due diligence in investigating the Collateral for
hazardous wastes and substances. Grantor hereby (a) releases and waives any future claims against
Creditor for indemnity or contribution in the event Grantor becomes liable for cleanup os other costs under
any sueh lays, and (hb) os to indemnify and hold harmless Lender against any and ail claims and losses
resting from a breach of this provision of this Agreement. ‘This obligation to indemnify shall survive the
payment of indebtedness and (he satisfaction af this Agreement,

Maintenance of Casualty tnsnrance, Grantor shall procure and maintain ull risks insurance, including
without limitation fire, (heft and {ability coverage together with such other insurance as Lender may
require with respect to the Collateral, in form, amounts, coverages and basis reasonably acceptable to
Creditor and issued hy a company or companies reasonably acceptable to Creditor. Grantor, upon request
of Creditor, will dotiver to Creditor from time lo time the policies or certificates of insurance in form
salisfactory to Creditor, including stipulations that coverages will not be cancelled or diminished without at
Icast ten (10) days’ prior written notice to Creditor and not including any disclaimer of the insurer's
fiability for failure to give such a notice. Each insurance policy also shall include an endorsement
providing that coverage in favor of Creditos will not be impaired in any way by any act, ontission or default
of Grantor or any other person, In connection with ail policies covering assets in which Creditor holds or is



Fax from: 17689477295 LABORS FIELD DEPT 16-25-13 89:67a Pg: 3

the terms of the Memoranda, the Company is bound to the terms of the relevant collective
bargaining agreements incorporated by reference in the Agreement and the Funds’ respective
Agreements and Declarations of Trust.

3. Pursuant to agreement, the Funds have been duly authorized to act as collection
agents on behalf of the District Council for union dues owed to the District Council.

4. The Agreement and the Funds’ respective Agreements and Declarations of Trust
to which the Company is bound require that the Company submit benefit reports and
contribution payments by the tenth day of the following month, Payments which are not
received within thirty days of this date are assessed liquidated damages in the amount of 10
percent or 20 percent liquidated damages (on Pension, Welfare and Training Fund contributions
coming due after June 1, 2007) of the principal amount of delinquent contributions, and interest
at arate of 12 percent compounded annually from the date of delinquency forward. The
Agreement and the Funds’ respective Agreements and Declarations of Trust also obligate the
Company to submit its books and records to the Funds for periodic audits to determine benefit
contribution compliance. A copy of the relevant portions of the Agreement are attached as
Exhibit B-2; a copy of the relevant portions of the Amended Agreement and Declaration of Trust
creating the Laborers’ Pension Fund are attached as Exhibit B-3; and a copy of the relevant
portions of the Amended Health and Welfare Department of the Construction and General
Laborers’ District Council are attached as Exhibit B-4.

5. The Company entered into an Installment Note (“Note”) to pay certain amounts
due to the Funds for contributions for the period of November and December 2011 and May and

June 2012. The Note was guaranteed by Kenneth M. Jacobs pursuant to a Guaranty of Payment



only from the contractor with whom the Union has a dis-
pute and not from any other entity. The foregoing shall
not apply if the Employer has made payment on behalf of
the affected employees to another fringe benefit fund
under a labor agreement of a union affiliated with the
Building and Construction Trades Department, AFL-CIO.

Article VI
BONDING TO GUARANTEE WAGE PAYMENTS
AND WELFARE AND PENSION CONTRIBUTIONS

Paragraph 1. All Employers shall procure, carry and
maintain a surety bond in form and amount satisfactory
to the Union, but not less than in the principal sum of
$5,000.00, to guarantee payment of wages, Pension and
Welfare Trust contributions, during the term of this
Agreement.

Paragraph 2. If the Employer employs between
seven (7) and ten (10) Laborers, the surety bond shall be
increased to $15,000. If the Employer employs between
eleven (11) and twenty (20) Laborers, the surety bond
shall be increased to $25,000. If the Employer employs
twenty-one (21) to forty (40) Laborers, the surety bond
shall be increased to $35,000. If the Employer employs
forty-one (41) or more Laborers, the surety bond shall be
increased to $45,000,

Paragraph 3. The Employer shall be required to
obtain an appropriate bond within thirty (30) days of
executing this Agreement, which bond may also be posted
in cash. Should the Employer fail to comply with the pro-
visions of this Article, the Union may withdraw its
employees or strike until such compliance occurs, and the
Employer shall further be liable for all costs, including
attorneys fees, incurred in enforcing these provisions.

Paragraph 4, The Employer shall give notice to the
Union and the appropriate Fund Office in writing not
later than ten (10) days after the occurrence of any of the
following events relating to the Employer, occurring after

the date hereof:
19


Jacobs & Sons

6/12/2013 PTW

6/17/2013 PTW

6/18/2013 PTW

6/24/2013 PTW

7/1/2013 PTW

7/8/2013 PTW

7/9/2013 PTW

8/13/2013 PTW

8/30/2013 PGL

9/3/2013 PTW

9/12/2013 PTW

9/16/2013 PTW

9/17/2013 PTW

10/2/2013 PTW

40/7/2013 PTW

PTW

10/14/2013 PTW

Telephone conference with T. Miller.

Telephone call to T. Miller.

Telephone conference with T. Miller.

Conference with JM re: payment; telephone call to T. Miller.
Telephone conference with T. Miller.

Telephone call to T. Miller.

Conference with J. Fosco; Telephone conference with T. Miller.
Review of email; Telephone conference with T. Miller, Telephone

conference with J. Fosco; memo to file re: same.

Preparation of Notice of Motion, Declaration of Fees; draft Order and
exhibits for Motion to Reinstate and Confess Judgment.

Telephone conference with T. Miller.

Edits to Motion and Affidavit of J. Fosco.

Conference with J. Fosco; Telephone conference with T. Miller re: reports.
Edits to Fosco Affidavit; email; letter to T. Miller.

Telephone conference with J. Fosco; edits; email Declaration; Telephone

conference with T. Miller.

Edits to Motion; Telephone conference with J. Fosco; Conference with KT;
telephone call to T. Miller.

Edits to Motion; Telephone conference with J. Fosco re: payment;
telephone cail to T. Miller.

Conference with J. Fosco; Telephone conference with T. Miller

Page

Hrs/Rate

0.10
200.00/hr

0.10
200.00/hr

0.10
200.00/hr

0.10
200.00/hr

0.10
200.00/hr

0.10
200.00/hr

0.10
200.00/hr

0.30
200.00/hr

0.40
100.00/hr

0.10
200.00/hr

0.50
200.00/hr

0.20
200.00/hr

0.30
200.00/hr

0.30
225.00/hr

0.50
225.00/hr

0.40
225.00/hr

0.10
225.00/hr

2

Amount

20.00

20.00

20.00

20.00

20.00

20.00

20.00

60.00

40.00

20.00

100.00

40.00

60.00

67.50

112.50

90.00

22.50


noticnenees RSpREET ST

INSTALLMENT NOTE

“hig Installront Note Note") fs made berwoen the Laborers’ Pension Fund (“Pension Fund”) and Laborers? Welfare
Fan of the Health And Wellare Department of te Construetion and Gener 1 Laborers’ District Caunell of Chicago and Victuity
(éifoalth and Welfare Fund” or collectively the “Fanids”), the parties of the Srst party and dacobs & Say. Inc. (the “Compaay”),
dhe party of Gre second part. ,

WWAEREAS, the Company has at all relevant tiatey beon party to 1 eolfectiva bargaining agreement (CRAY) widh the
Construction and General Lahorers? District Cowneil of Chicago and Vielnity, whercunder it is obligates ta male certain
Conoibutions t0 the above-named Funds, ay well xs (o-the Tyaiding Fond, on bebialf of Us covered employees, and to submit

payment of mi employeeunion dues:

WHEREAS, the Company has failed to timely pay covtuie contributions owed to the Funds for the poriod of November
ZOU through December 2051. and May 2012 drorigh Sune 2012,

WHERLAS, the Company has failed to-remit all omployee unfon ducé 10 the Wimds, as the designated collection agent tor
tho Construction and General Laborers? District Comncil of Chicago and Vicinity, for the porlod of Decor 20 At fay 2042.

_Havoysgh dune 2012.

WHEREAS, ‘the Company destros Yo pay sl delinquencies owed, to the Kunds, to pay alt union duet owotl to the
Constraction aie General Laborers? District Comteil of Chicage and Vicinity, together with Hquldated damelges: and Miterest, as
sut forth below and further deshes to yorsain current in its obligation to pay confributions tote Funds.

THE PARTIES HEREBY AGREEs follows:

1. Tho Company will pay $2087.03 to the Health and Welfare Fund (comprised of $65,064.42 to delinquent
contributions, $13,012.88 in liquidated damages, $560.00 tn attorneys’ Fees and costs and $12.23%%73 in interest)
(based on an interest vate of 12%). The Company wit also pay $65.493.12, be the Pension Fund (comprised of
$46,768.58 in delinquent contributions, $2,383.72 In Hiquiduted duminges, $560.00 in attorneys” fees and costs anc
$8,810.89 in interest). AMl of those nniounte shall he pald according ( the schedule described below Sa paragraphs 4
and 5,

2. The Company wit also pay $3,040.64 to the Training Fund (comprised of $2,445.05 fa delinquent contributions,
$489,01 in liquidated damages and FLOGSS In interest), $280.77 to the ISPA Fund (comprised of $249.76 in
delinquent contribetions, $24,98 in liquidated dimages: nnd $6,03 In Intorest), $248.06, to tho. LECET Mund
(comprised of $218.84 in dotluquent contributions, S218 in Hiquiduted damages and $4.27 in Interest), $421.14 to the
LEDCMC Fund (comprised of $374.64 tn do}inquent edntribytions, $37.46 IN Haitldated damages and $2.04 in Interest)
and $5,369.88 fp union dues (comprised of $3392.44 in delinquont contribudons and $339.24 in fiquidated damages
and $1,638.20 in accumruitated Ducs ponafties), ‘Phere delinquent amounty shall be paid dy theirsentrety'at the timo
payment ander thls Note eanmenees, in necorviatrce will the schedule described in paragraph 4,

3. The Company will nlvo pay the Pands or the sum of $1120.00 reprexeuting attorney: fees and casts incurred by the
Funds in’ Cnse NoJ2 ©2514. This amount Js split oqually between Welfare aud Pension as described Jn paragraph |

above,

4 -Stmultancously with the execution of thls Note on August 17, 2012, (he Company Will pay Mite amounta set forth abowe
i paragraph 2 nnd 82021,03 to tho Health aud Wolfare Mund and $1,459.51 to the Ponsion Hund.

5, Ror twenty-four (24) consecutive monthg ecanunonciug on Se ptember 1, 2012 and aiding on Auaust 1, 214, the
Company will-pay $3,202.25 per month to the Health and Welfare Fond and $2,668.47 per month to the Pension

fund,
6 The Company will romit afl paysacnts fo the Funds? Adrafalstradve Offices, which are locxtod at L6S Cormat
Rond, Westeheater, Minals 60184,

1. ‘Tho Company understands and agrees that this Installorent Note js bused on xeports submitted by (he Company ta
the Kands and that the Faads reserve the right to condwet an audiéy ‘aceordanee with the terms of the collective
bargaining, agreement and the Funds? respective Agreements and Declarations of ‘Frust, to determine benelit

case bution compliance for the timo perlod covered herein and fardher rues the Hghe 69 collect any unpald
contributions, unson des, faseresf, Hiquidtated damagesy aud audit costs as shows on sald audit.

EXHIBIT


Fax from : 17689477295 LABORS FIELD DEPT 18-25-13 18:43a Pg:

6. Based on the foregoing, $225.00 represents a fair and reasonable market rate for
my and Jerrod Olszewski’s in-house legal services to the Funds in this matter.

7. Christina Krivanek, in-house counsel for the Laborers’ Funds, received a
Bachelor of Arts Degree from The Ohio State University in 2002 and a Juris Doctor Degree from
the DePaul University College of Law in 2005. She was admitted to the bar of the state of
{linois in November 2005 and to the bar of the United States District Court for the Northem
District of Illinois in January 2006. In January 2006, she became in-house counsel for the
Laborers’ Funds.

8, Based on the foregoing, $225.00 represents a fair and reasonable market rate for
Christina Krivanek’s in-house legal services to the Funds in this matter.

9 Amy Carollo, in-house counsel for the Laborers’ Funds, received a Bachelor of
Arts Degree from Illinois State University in 2000, Masters of Science from University of
Tinois at Chicago in 2002 and a Juris Doctor from Chicago-Kent College of Law in 2005. She
was admitted to the bar of the State of Illinois in November of 2005 and to the bar of the United
States District Court for the Northern District in January 2006. In March 2006, she became in-
house counsel for the Laborers’ Funds.

10. Based on the foregoing, $225.00 represents a fair and reasonable market rate for
Amy Carollo’s in-house legal services to the Funds in this matter.

1. John Hamada, in-house counsel for the Laborers’ Funds, received a Bachelor of
Arts Degree from University of Illinois at Urbana-Champaign in 2000 and a Juris Doctor from

Chicago-Kent College of Law in 2006. He was admitted to the bar of the State of Illinois in


Creditur. The word “Creditor” means James $. Jorgensen, Administrator of the Laborers’ Pension Pund and
Laborers’ Welfare Pund for tho Heath and Welfare Department of the Construction and General Laborers’ District
Council of Chicago and Vicinity, and agent of the General Laborers’ District Council of Chicago and Vicinily
Training Fund, his successors and assigns.

Bvent of Default. The wards “Bvent of Default” mean and include without timitation any of the Events of Default
set forlh below in the section titled “vents of Default.”

cessars and assigns, and Kenneth M. lacabs,

Grantor. The word “Grantor” means Jacobs 4 Son, Inc., its suc

individually

Guarantor, ‘The word “Guayantor® means and includes without timication ouch and all of the guarantors, sureties,
and accommodation parties in connection with the indebtedness,

Indebtedness. The word “Indebtedness” means the indebtedness evidenced by the Installment Note, including alt
principal and intrest, together with al] other indebtedness and costs and expenses for which Grantor responsible
under this Agreement or under any of the Related Documents. In additional the word “Indebtedness” inchides all
other abligations, debts and liabilities, plus interest thercon, of Grantor, or any one or mare af them, lo Creditor, as
well as all claims by Creditar against Grantor, ar any one ar more of them, whether existing now or later; whether
they are voluntary or involuntary, due or nat duc, direct or indirect, absolute or contingent, liquidated or
unliquidated; whether Grantor may be liable individually or jointly with others: whether Grantor may be obligated
as guarantor, surety, accommodation party or otherwise; whether recovery upon such indebtedness may be or
horenfter may become barved by any statute of limitations; and whether such indebtedness may be hereafter may

become other unenforceable,

Note. ‘The word “installment Note” means the Installment Nutv uid Guaranty of Payment and Indemnification
Agreement entered into by Jacobs & Son, Inc. and Kenneth M. Jacobs with the Creditor on or about
September 07, 2012 _

Related Documents, ‘The wards “Related Documents” mean and include without limitation atl promissory notes,
credit agrcements, loan ugreeinests, cnvironmental agreements, guaranties, security agreements, mosigages, deeds of
trust, and all other instruments, agreements and documents, whether now or hereafter existing, executed in
connection with the Indebtedness.

OBLIGATIONS OF GRANTOR, Grantor warrants and covenants to Creditor as follows;

Perfection of Security Literest. Grantor agrees to execute such financing statements and to take whatever
other actions are requested by Creditor to perfect and continued Creditor’s security interest in the
Collaterat. Upon request of the Creditor, Grantor will deliver lo Creditor any and all of the documents
evidencing or constituting the Collateral, and Grantor will note Credi(or’s interest upon any and ull chattel
paper if not delivered to Creditor for possession by Creditor. Grantor hereby appoints Cr ‘editor as its
irrevocable attorney-in-fact for the purpose of excouting any documents necessary to perfect or to continue
the security interest granted jn this Agreoment. Creditor may at any time, and without further authorization
from Graniar, (ile a carbon, photographie or other reproduction of any financing statement or of this
Agreement for use as a financing statement. Grantor will reimburse Creditor for all expenses for the
perfection and the continuation of the perfection of Creditor's security interest in the collatera), Grantor
promptly will notify Creditor before any change in Geantor’s name including any change to (he assumed
business names of Grantor. This is a continuing Sccurity Agreement and will continue in effect even
though all or any part of the indebtedness is paid ia full and even though for a period of Cane
Grantor may not he indebted to Creditor,

No Violation, ‘Che execution and delivery of this Agreement will not violate any law or agreement
governing Grantor or ta which Grantor is a party, and its certificate or articles of incorporation and bylaws

Go not prohibit any term or condition of this Agreement


i : 08 F615
May~08-2007 {2:25pm — From-Laborers‘Pen & Wel Funds + T-351—-P.002/0 F

AMENDMENT TO THE
RESTATED AGREEMENT AND DECLARATION OF TRUST
CREATING LABORERS’ PENSION FUND

WHEREAS, Article XI of the Restated Agreement and Declaration of Trust (“Trust
Agreement") of the Laborer's Pension Fund (the "Fund") provides that the Board of Trustees
have the authority to amend the Trust Agreement;

WHEREAS, Article IV of the Fund’s Trust Agreement sets forth the powers and duties
of the Trustees;

WHEREAS, the Trustees have an obligation to protect the interests of the Plan’s
Participants and to protect the assets of the Fund;

WHEREAS, the Trustees are aware of situations in which contributing Employers have
ceased business operations leaving a large indebtedness to the Fund without a reasonable
likelihood of the Fund collecting such delinquent contributions;

WHEREAS, the individual officers and owners of some Employers have secured jobs
knowing that they will not comply with their legal obligations to the Fund by keeping accurate
tecords of their laborer employees' employment and make all the required contributions to the
Fund; and

WHEREAS, such illegal conduct causes substantial losses to the Fund and deprives
Employers who comply with its obligations to the Fund of opportunities to secure employment
for their laborer employees; and

WHEREAS, the individual officers, partners or owners of some contributing Employers
have used various entities to avoid liability to the Fund for contributions that would otherwise be
due and then created new companies in order to continue to operate using such illegal practices;

WHEREAS, in some instances such individual officers or owners have accepted
employment as a supervisor or manager with another contributing Employer and been
responsible for causing such Employers to fail to comply with their obligations to keep accurate
records and make all required contributions;

WHEREAS, the Trustees have determined that certain individuals and entities (as
hereinafter defined “Deadbeat Employers”) who engage in these practices willfully or with
reckless disregard for their legal obligations or with repeated incompetence at the expense of
their employees and the Fund have caused the Fund to incur large financial losses and employees
to lose benefit coverage for which they had worked;

WHEREAS, the Trustees have concluded that such Deadbeat Employers’ practices result
in unfair competition for other contributing Employers often with the result of enriching


C. Amount.of Cosh Boul

‘This agreement for the payment and deposit ofa cash bond in the amount of $5,000.00 to

bo paid oul. in fventy (20) monthly paynionts in the amount of 1.00 each, commencing on

December 1, 2012 is entered into this Eth day of |

by the undersigned representatives of he Employer and Funds:

Son Kennth Jacobs
Position: OWREE canes pate:......L{ Da (Benen

Date; November 14, 2012



S 615
May~09~2007 12:25pn — From-Laborers'Pen & Wel Funds 7-351 P.003/008  F

themselves and depriving lawful Employers of needed work, and depriving the Fund's
participants of benefits;

WHEREAS, it is the desire of the Trustees to amend the Trust Agreement in order
expressly to provide that the Fund may impose appropriate protective financial requirements on
any Employer that is owned by or that hires a Deadbeat Employer in @ managerial or supervisory
Tole;

__ NOW THEREFORE, the undersigned Trustees of the Fund, pursuant to the authority of
Article XII of the Restated Agreement and Declaration of Trust, do hereby adopt the following
Amendment to the Restated Agreement and Declaration of Trust effective as of August 1, 2006:

L

The following is added as an additional Paragraph under Article I, “Certain
Definitions”, Section 2, “Employer”:

“A “Deadbeat Employer” is defined as any entity or individual (including, but not limited
to a corporation, partnership, or sole Proprietorship and its respective officers, partners or
owners) who have, or previously had in the last 10 years, incurred substantial liability to the
Fund for delinquent contributions and then ceased operations or became insolvent, without
Satisfying such substantial liability and without any reasonable likelihood of paying the amounts
due to the Fund. For purposes of this Section, substantial liability shall not be less than $30,000.”

qq
The following is added as Section (4) to Article VII, “Funding Pension Plan
Benefits”:
ion 4. 1D: (AL RE! ‘S FOR D 1B) YERS.
@ OYER O BY DE, AT YER. Subject to the provisions

of subsection (c) and following 30 days after receipt by the Employer of the Notice described

therein, any Employer that is owned, whether in whole or in part, by a Deadbeat Employer shall
be deemed by the Fund as a successor employer to the Deadbeat Employer for purposes of the
delinquent contribution obligations of the Deadbeat Employer to the Fund and shall (i) be liable
to the Fund for the unpaid liabilities of the Deadbeat Employer and (fi) be required to post a bond
for the benefit of the Fund in an amount equal to twice the amount of the Deadbeat Employer's

prior delinquencies to the Fund.

®) 2# IYER OPERA’ BAT EMPLOYER, Subject to the
Provisions of subsection (c) and following 30 days after receipt by the Employer of the Notice
described therein, any Employer whom the Trustees reasonably believe employs an officer,
partner or owner of a Deadbeat Employer in a managerial or supervisory position or in any other
responsible position in which the Deadbeat Employer may exercise any control over the assets of

2


i P.009/009 F~615
may ve ever t4-copm — rrommLaporers Fen’ G Kel bunds + T-381

IN WITNESS WHEREOF, the undersigned Trustees have caused this Amendment to be
executed on the dates appearing opposite their respective names,

Ke GE Dhow, Ving
P. CONNOLLY DATE

ibs CO bak Le ae,

Bio 3 6
"poy GrRabows!
LILp nfoc_ 32 of

Al i: Ca DATE

DATE

Ranpy, TON DATE

Fain) Jl hale
ULL DArz !



(b) To enforce the provisions of the Pension‘Plan and the rules and regulations

adopted by the Tnistees in a uniform manner with respect to individuals ©

similarly situated.

(©) ‘To determine questions arising under the Pension Plan or this Agreement,
including the power to determine the rights’ of Employees and their
Beneficiaries, and their respective benefits, and to remedy ambiguities,

inconsistencies or omissions.

ARTICLE VII

FUNDING PENSION PLAN BENEFITS

SectionI. IN GENERAL. In order to fund the benefits provided under the
Pension Plan, each Employer, for the period that it is obligated by a Written Agreement,
shall make contributions to the Trustees at the times required by that agreement. The rate
of contributions shall be determined by the applicable Collective Bargaining Agreement or
Participation Agreement, together with any amendments, supplements or modifications
thereto. Notwithstanding the preceding sentence, if an Employer is required to make
contributions by reason ofa Participation or other Written Agreement that is nota Collective
Bargaining Agreement, the amount of its contributions shal! be the same as the amount

required by the Collective Bargaining Agreement in effect between the Employer

Association and the Union which covers Employees performing similar work. No


November 26, 2012 Jacobs & Son, Inc, and Kenneth M. Jacobs,
individually,
By: /s/ Todd A. Miller

Allocco, Miller & Cahill, P.C.
3409 N. Paulina
Chicago, IL 60657


Enforceability of Collateral, To the extent the Collateral consists uf accounts, chattel paper, or general
intangibles, the Collateral is enforceable in accordance with its terms, is genuine, and complies with
applicable laws concerning form, content and manner of preparation and execution, and all persons
appearing to be obligated on the Collateral have authority, and capacity to contract and are in fact obligated
as they appear to be on the Collateral, At the time any account becomes subject to a security interest in
favor af Creditor, the account shall be a good and valid account representing an undisputed, bona fide
indebtedness incurred by the uccount debtor, for merchandise held submit to delivery instruction or
theretotore shipped or delivered pursuant to a contract of sale, or for services theretofere performed by
Grantor with or far the account debtor; there shall be uo sefolls or counterclaims inst any such account,
and no agreement under which any deductions or discounts may be claimed shell have been made with the
account debtor except thase disclosed to Creditar in writing,

Location of the Collateral, Grantor, upon request of Creditor, will deliver (o Creditor, in form satisfactory
to Creditor a schedule of real properties and Collateral focations relating W Grantor's operations, including
withatl limitation the Following: (a) all real property owned or being purchased by Grantor; (h) all real
properly being rented or leased by Grantor; (c) all siorage facilities owned, rented, leased, ot being used by
Grantor; and (d) all other properties where Collateral is or may be located. Except in the ordinary course of
us business, Grantor shall not remove the Collateral from its existing locations without the prior written
consunl of the Lender,

Removal of Coflateral, Grantor shall keep the Collateral (ar to the extent the Collateral consists of
intangible property such as accounts, the records concerning the Collateral) at Grantor's address shown
above, or at such othor locations as are acceptable to Creditor. Fixcept in the ordinary course of its
business, including the sales of inventory, Grantor shall not remove the Collateral from its existing
locations without the prior written consent of Creditor, To the extent that the Collateral consists of
vehictes, or other titled property, Grantor shall nat fake or permit any action which would require
application for certificates of title for the vehicle outside the State of Iinois, without the prior written

consent of Creditor.

Transactions Involving CoUateral, Uxcept for inventory sold or accounts collected in the ordinary course
of Grantor's business, Grantor shall not sell, or otherwise transfer or dispose of the Collateral. While
Grantor is not in default under this Agreement, Grantor may sell inventory, but only in the ordinary course
of ils business and only to buyers who quality as a buyer in the ordinary course of business, A sale in the
ordinary course of Grantor's business does nut include a transfer in partial ar total satisfaction of a debt or
any bulk sale, Grantor shall not pledge, mortgage, encumber of otherwise permit the Collateral to be
submit to any Hien, security interest, encumbrance, or charge, other than the security interest provided for in
this ngrecment, without the prior written consent of Creditor. ‘This includes security interest even if junior
in vight to the security interest granted under this Agreement. Untess waived by Creditor, all proceeds trom
any disposition of the Collateral (for whatever reason) shall be held in trust for Creditor and shall not be
commingled with anyother funds; provided however, this requirement shall not constitute consent by
Creditor to any sale or other disposition. Upon receipt, Grantor shall immediately deliver any such
proceeds to Creditor.

‘Title, Grantor represents and warrants to Creditor that it holds good and marketable title ta the Collateral,
free and clear of all liens and encumbrances excep! for the lien of this Agreement. No financing statement
covering any of the Collatcral is on file in any public oftice other than those which reflect the security
interest created by this Agreement or fo which Creditor has specifically consented. Grantor shatt defend
Creditor's rights in the Collateral against the claims and demands of all other persons,

Collateral Schedules and Locations. As oflen as Creditor shall require, and insofar as the Collateral

s of accounts, Grantor shall deliver (o Creditor schedules of such Collateral, including such
infaymation as Creditor may require, inchiding without limitation names and addresses of such account
debtors and agings of accounts, Insofar as the Collateral consists of inventory and equipment, Grantor shall
deliver lo Creditor, as often as Creditor shail require, such lists descriptions, and designations of such
Collateral as Creditor may require to identily the nature, extent, and location of such Collateral, Such
information shall be submitted for Grantor and each of its subsidiaries or refated compunies,



CERTIFICATE OF SERVICE

The undersigned certifies that he caused a copy of the foregoing Motion to Reinstate and
Confess Judgment to be served upon the following persons via the Court’s electronic notification
system this 25" day of October 2013.

Todd A. Miller

Kathleen M. Cahill

Allocco, Miller & Cahill, P.C.
3409 North Paulina Street
Chicago, IL 60657

/s/ Patrick T. Wallace


12. Bank account statements and canceled checks from any account used in conjunction
with the employer’s business.

13. Ifrecords of all hours worked, rates of pay and classifications are not provided in the
records listed in items 1 through 10, the employer shall maintain monthly lists of all employees
not shown on payroll records, showing Social Security number and work classification (or code
or clock or ID number), rates of pay and hours worked.

Honor Roll Employers shall be required only to produce basic records needed by the
Benefit Funds’ auditors to do an audit, specifically items 1 through 7 above. However, if an
initial examination of such limited records discloses significant record keeping errors or failures
to contribute, the auditor may request additional records listed above. In the absence of evidence
of a deliberate failure by an Honor Roll Employer to contribute on behalf of a bargaining unit
employee, the rebuttable presumptions provided for in the attached Policy for Retention and
Production of Employer Records shall not apply to such Honor Roll Employer.

Notwithstanding the foregoing, the Collection Committee or the Director of the Field
Department-may, in their discretion, determine that a full audit shall be done of any employer or
that, where-a sampling audit is to be conducted, specific records shall be produced. The
judgment of the trustees in interpreting and applying this policy shall be conclusive and binding
on all parties,

Adopted January 9, 2002



Fund. The Collection Committee may include trustees of the Laborers’ Pension Fund as

members of such Collection Committee.

In the event an Employer party to this Agreement or otherwise bound thereby becomes
delinquent in his contributions or an installment agreement, or fails to post a bond as required, or

. Tefuses to provide the records required to be kept by contributing employers or submit to an
audit, said delinquent Employer shall be liable for reasonable attomeys’ fees and for all
reasonable costs incurred in the collection process, including but not limited to, court fees, audit
fees and investigative costs. The tenn “reasonable attomeys’ fees” as used herein shall mean all
aitomeys’ fees in the amounts for which the Trustees become legally obligated for actions
seeking delinquent contributions, to compel an audit, or for recovery of liquidated damages, audit

costs, filing fees and any other expenses incurred by the Trustees.

The Trustees are hereby given the power and authority in their discretion, to require any
. Employer to deposit with the Trustees, in advance, as a guarantee for the payment of monthly
contributions, an amount equal to three (3) times the monthly contributions of such Employer, as
estimated by the Trustees. At the option of the Trustees the Employer shall furnish the Trustees
in lieu of any cash deposit a bond in an amount not less than Five Thousand Dollars ($5,000.00),
or in an amount consistent with the terms. of the current Collective Bargaining Agreement to
which the Employer is subject.” In the event an Employer is repeatedly delinquent in its
contribution payments to the Welfare Fund, the Trustees have the power and authority to require.
that Employer to purchase a bond in excess of $5,000.00 or the amounts set forth in the current
Collective Bargaining Agreements in an amount equal to three (3) times the highest monthly
contributions of the Employer in the twelve months prior to any delinquency. The Trustees, in
their discretion, may also waive the requirement of a cash deposit or a surety. bond in lieu of a

Personal guaranty when such waiver is warranted.

Section 3. REPORT ON UTIONS AND PRODUCTION OF RECORDS.

The Employers shall make all reports on contributions required by the Trustees. Each Employer
shall promptly furnish to the Trustees, on demand, the names of its employees, their social
security numbers, the hours worked by éach employee, and such other information as the
Trustees may reasonably require in connection with the administration of the Trust. The Trustees
may at any time have an audit made by an independent accounting firm of the payroll of any
Employer in connection with the said contributions and/or reports. All Employers shall be
records in- compliance with procedures fiom the beginning of such

required to. maintaii :
Employer’s participation in the Trust until given written authorization by the Administrator, upon

request, to destroy said records. The Administrator shall require the Employer to designate the
classification of all of his employees and if the Employer fails to do so, the Trustees shall
conduct an investigation for the purpose of determining the classification of such employees and

the results of said investigation shall be conclusive. Attached hereto as Addendum A are the

current collection policies concerning the Scheduling of Audits and Retention and Production of
os

Employer Records adopted by the Trustees,

16



the Collateral, All such expenditures incurred or paid by Creditor for such purposes will then bear interest. al the rate
charged under the Installment Note from the date incurred or paid by Creditor to the date of yopayment by Grantor.
AU such expenses shall become a part of the indebtedness and, at Creditor’s option, will (a) be payable on demand,
{b) be aduled to the halance of the Instathment Note and be apportioned amount and be payable with any installment
payments to become due during either (i) the ferm of any applicable insurance policy or (ii) the remaining term of
the Installment Note, or (c) {reated as & balloon payment which will be due and payable at the Installment Note’s
maturity. ‘This Agreement also will secure payment of these amounts. Such right shall be in addition to all other

ts and remedies to which Creditor may be entitled upon the vecurrence of an Rvent of Default

REINSTATEMENT OF SECURITY INTEREST. [payment is made by Grantor, whether voluntarily or
otherwise, or by guarantor or by any third party, on the Indebtedness and thereafter Creditor is forced to remit the
amount of that payment (a) to Grantor's trustee in bankruptcy or to any similar person under any federal or state
bankruptcy law or law for the relief of debtors, (b) by reason of any judument, decree or order of any caurt or
administrative body having jurisdiclion over Creditor or any of creditor's property, or (c) by reason af any
sertloment or compromise of any clainy made by Creditor with any claims (including without limitation Grantor), (he
Indebtedness shall be considered unpaid for the purposes of enforcement of this Agreement and this Agreement
shall continue to be effective of shall be reinstated, us the case may be, notwithstanding any cancellation of this
Agreement or, of any note or other instrument or agreement evidencing the Indebtedness and the Collateral wilt
continue lo secure the amount repaid or recovered to sane extent as if that amount never had beer originally
received by Creditor, and Grantor shall be bound by any judgment, decree, order seftlement or conpromise relating

To the Indebtedness or to this Agreement.

EVENTS OF DEFAULT, Each of the loliowing shall constitute an Event of Default under this Agreement:
Default in Indebtedness. Failure to Grantor to make any payment when due on (he Installment Note,

jlure af Grantor to comply with or to perform any other term, obligation, covenant or
agreement benween

Other Defaults,
condition contained in this Agreement or in any of the Related Documents in any other

Creditor and Grantor

Default in Favor of Third Parties, Should Borrower or any Grantor defaull under any loan, extension of
credit, security agreement, purchase or sales agreement or any other agreement, in favor of any other
creditor or person thal may materially affect any of Borvawer's property or Borrowers’ or uny Grantor's
ability to repay the Loms or perform their respective obligations under this Agreement or any of the

Related Documents.

False Statements. Any warranty, representation or statement made or furnished to Creditor by or on
Uchalf of Grantor under this Agreement, the Note or the Related documents is false or misleading in any

material respoct, cither now or at the time made or furnished.

Detective Collateralization, This Agreement or any of the Related Documents ceases to be in full foree
and effect (including failure of any collateral documents to create a valid and perfected security interest or
Jien) at any time and for any reason,

Insolvency, The dissolution or termination of Grantor's existence as a going business, the insolvency of
Grantor, the appointinent of a seceiver for any part of Grantor's properly, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any proceeding under any bankruptcy or
insolvency laws by or against Grantor.

Creditor or Forfeiture Proceedings. Commencement of foreciosuve or forfeiture proceedings, whether
by judicial proceeding, self-help, repossession ar any other method, by any creditor of” by any
governmental agency against the Collateral or any other collateral securing the indebtedness. ‘this includes
a garnishment of any of Grantor’s accounts, including deposit accounts, with Creditor. however, this Evont
of Default shail not apply if there is a good faith dispute by Grantor as to the vatidity or reasonableness of
the vlaim which is the basis of the creditor forfeiture proceeding and if Grantor gives Lender written notice
of the creditor or forfeiture proceeding and deposits with Lander monies or a surety bond for the credilor or



year, if able, but not later than June 1, the Union in its
sole discretion, shall determine the amount of additional
contributions to Welfare and/or Pension and Training to
be allocated from the economic package for that year.
(See Article V, Paragraph 1).

The Employer agrees to be bound by the Agreements
and Declarations of Trust establishing the Health and
Welfare Department of Construction and General
Laborers’ District Council of Chicago and Vicinity, as
well as any amendments thereto.

Paragraph 3. PENSION: Beginning June 1, 2010 the
Employer agrees to make a pension contribution of $8.57
per hour for each hour worked by all Employees covered
by this Agreement in addition to the wages and welfare
payments herein stipulated. This $8.57 per hour shall be
paid to the Laborers’ Pension Fund or to a designated
appointee at the end of each month.

That for the periods June 1, 2011 to May 31, 2012;
June 1, 2012 to May 31, 2013; that on May 1 of each
yeai, if able, but not later than June 1, the Union in its
sole discretion, shall determine the amount of additional
contributions to Welfare and/or Pension and Training to
be allocated from the economic package for that year.
(See Article V, Paragraph 1).

The Employer agrees to be bound by the Agreements
and Declarations of Trust establishing the Laborers’
Pension Fund, as well as any amendments thereto.

The parties agree that the Employer shall make lump
sum contributions to employee fringe benefit accounts,
administered by the Trustees on behalf of each employee.
It is further agreed that such contribution shall be accom-
panied by a breakdown of payment according to appro-
priate benefits.

The Trustees of the Welfare Fund and the Trustees of
the Pension Fund shall, among other things, have author-
ity to determine the type and amount of benefits to be
provided in each of said funds, the eligibility rules govern-

12


2. Under the terms of the Note, the Company will pay contributions owed for the
period of November 2011 through December 2011 and May 2012 through June 2012 over the
course of twenty-four (24) months with the last payment coming due on August 1, 2014.

3. Accordingly, the parties respectfully request that the Court dismiss this matter
without prejudice and retaining jurisdiction to enforce the terms of the Settlement Agreement up
and through September 30, 2014. Thereafter, the parties request that the matter be dismissed
with prejudice except the dismissal be without prejudice to the Funds’ right to conduct an audit
of the Company’s books and records for the period of December 1, 2009 forward and to collect
any additional unpaid contributions, dues, wages, interest, liquidated damages or audit costs
revealed as due and owing therein. Further, the parties respectfully request that the matter be
dismissed without prejudice to the Funds’ right to enforce the terms of the Guaranty and CSA
against the Defendants including any additional obligations that may be due or come due under
the terms of Guaranty and CSA.

Respectfully submitted,
November 26, 2012 Laborers’ Pension Fund, et al.
By: /s/ Patrick T. Wallace
Office of Fund Counsel
111 W. Jackson Blvd., Suite 1415

Chicago, IL 60604
(312) 692-1540


amount to be unpald and owed thereon, including interest, fiquidated damages and reasonable cost of collection
jucluding reasonable attorneys’ fees, The Guarantor agrees to waive ond release ail errors which may intervene in any
such proceedings, and consent to immediate execution upon such Judgement, hereby ratify and confirming all that said
aitomney mey do by virtue hereof.

14, Warranties, Guarantor makes to the Funds the following representations and warranties:

(a) Authorization. Guarantor has fill right, power and authorization to enter into tris Guaranty end
carry out his obligations hereunder

(b) No. Conflict, The execution, delivery and performance by Guarantor of this Guaranty will not
violate or be in conflict with, results in @ breacl: of, or constitute a default under, any {ndenture, agreement or any other
instrument to which Guarantor is a party or by which Guarantor or any of his assets or properties Is bound, or any
oder, writ, injunction or decree of any court or governmental institute,

(©) Litigation, There are no actions, suits or proceedings pending, or to the knowledge of Guarantor,
threatened against or advorsely affecting any Guarantor at law of in equity or before or by governmental agency or
instrumentality that. Involve any of the transactions herein contemplated, or the possibilty of any judgment or liability
that may result in any material and adverse change itt the financial condition of any Guarantor, Guarantor {s not in
default with respect to any judgment, order, writ, injunction, decree, rule or regulation of'any court.

(a) Bnforceability. This guaranty is a legal, valid and binding obligation of Guarantor, enforceable ia
accordance with ifs terms, except as enforcenbility may be limited by applicable bankruptey, insolvency or similar
Jaws affecting the rights of creditors generally,

15. Notices, All notices oy other communications required or permitted hereunder shail be (a) in welting,
and shall be deemed to be given when either (1) delivered in person, (I) three (3) days after deposit in « regularly
maintained receptacle of the Uniled States mail as registered or Certified mail, postaye propaid, (IIL) when received If
sent by private courler service, or (IV) on the day on which Guarantor refuses delivery by mail or by private courier

service, and (b) addressed as follows:
In Cage of Guarantor In Case of the Funds:

Collection Counsel
Patrick T, Wallace’

Kenneth Jacots ‘ ¢
3001 Industrint Avene __ Laborers Pension é& Welfare Fund
Rolling Mondowa, 16 40008 Sub Office
= 111 W Jackson Blvd
Suite 1415

Chicago 1 60604-3868

m thne to tine be designated by the party to be addressed by notice to the ather in

the manner hereinabove provided. The Funds will use their best efforts to sond courtesy copies of notices provided
But the failure by tho Funds to send courtesy

hereunder to Guarantor’s aftomey,
copies to Guarantor’s attorney shall not limit of restrict the Funds’ rights under this Quaranty in any manner nor
relieve Guarantor of any obligations under this guaranty.

‘or such other uddresses as may ff01

conditionally waives, in. connection with any suit, aetion
every right he or she may have to (1) fnjunetive relict,
consolidated with any other

16. Additional Waivers, Guarantor expressly and une
or proceeding brought by the Funds on this Guaranty, any and
(1) a (rial by jury, (111) inferpose any counterclaim therein and (IV) seek to have the sane

or separate suit, action or proceeding.


audit the books and records of a participating Employer,
either directly or through their authorized representative,
whenever such examination is deemed necessary for the
purpose of compliance with the provisions of this
Agreement, including the obligation to remit Union Dues
under Article VII.

Each participating Employer shall make its books
and records available to the Trustees for such purpose. In
the event the audit discloses that the Employer, during the
period of the audit, had underpaid its contributions
and/or wages, the Employer shall be liable for the costs of
the examination, including but not limited to, audit fees
and reasonable attorneys’ fees. The Trustees’ authority to
waive any costs shall be governed by the terms of the
Trust Agreement.

Paragraph 4. Appointment of Trustees to the Health
and Welfare Department of Construction and General
Laborers’ District Council of Chicago and Vicinity and
the Laborers’ Pension Fund. The parties agree that the
Employer-appointed trustees of the Health and Welfare
Department of Construction and General Laborers’ Dis-
trict Council of Chicago and Vicinity and the Laborers’
Pension Fund and training and apprentice funds to which
Employers are required to contribute shall be appointed
solely by Employer associations that enter into collective
bargaining agreements with the Union requiring contribu-
tions to such funds (“Signatory Associations”). It is fur-
ther agreed that the Trust Agreements establishing such
funds shall be amended to replace any Employer associa-
tion that appoints a trustee and does not have a labor
agreement with the Union, replacing it with a Signatory
Association. The union and Signatory Associations shall
meet within 30 days of the effective dates of agreements
covering a majority of Fund participants to review the
appointment of Employer Trustees of the funds. It is
agreed that the numbers of hours contributed by
Employers represented by Signatory Associations com-
pared to contributions by other Signatory Associations
during the preceding year shall be the basis for assigning

14


also request that Defendants be ordered to pay post-judgment interest from the date of the
Judgment Order until the judgment is paid in full.
Respectfully submitted,
October 25, 2013 Laborers’ Pension Fund, et al.
By: /s/ Patrick T. Wallace
Office of Fund Counsel
Laborers! Pension and Welfare Funds
111 W. Jackson Blvd., Suite 1415

Chicago, IL 60604
(312) 692-1540


4. Employers Subject to Special Audits. At the discretion of the Director of the Field
Department full audits of employers obligated to contribute to the Benefit Funds may be conducted
at any time based upon information concerning possible delinquencies, e,g., failure to file monthly
remittance reports, failure to pay contractually required wage rates, information conceming a
possible closing or sale of the business, information that the employer is operating an alter ego or

similar bases suggesting possible delinquencies.

FULL AND SAMPLING AUDITS

1. New Employers. If there is a sufficient number of employees of a New Employer, the
auditor of the Benefit Funds may do a sampling audit to determine if the employer is maintaining
accurate records and making required contributions, otherwise the auditor will do a full audit, An
important purpose of audits for new employers is to inform employers of the procedures for
contributing to the Benefit Funds and the requisite records to be maintained. *

2. Honor Roll Employers. Sampling audits shall be used for Honor Roll Employers if they

have sufficient employees to warrant use of sampling methods. If a sampling audit discloses
inaccurate or incomplete record keeping or evidence of significant delinquencies, a full audit shall be

done.

3. Other Contributing Employers. Full audits shall be conducted if employers are not
qualified as New or Honor Rol! Employers.

4. Notwithstanding the foregoing, the Collection Committee or the Director of the Field
Department may, in their discretion, determine that a full audit shall be done of any employer or that,
where a sampling audit is to be conducted, specific records shall be produced.*

* For information concerning the requisite records to be maintained, see the Laborers’ Pension
and Welfare Funds Policy for Retention and Production of Employer Records, effective as of
April 1, 2006 and the Records Required to be Retained By Employers and Produced for Audits

adopted January 9, 2002.


CERTIFICATE OF SERVICE

The undersigned certifies that he caused a copy of the foregoing Settlement Agreement
and Stipulation to be served upon the following persons via the Court’s electronic notification
system this 26" day of November 2012.

Todd A, Miller
Kathleen M. Cahill
Allocco, Miller & Cahill, P.C.

3409 North Paulina Street
Chicago, IL 60657

/s/ Patrick T. Wallace


sometimes referred to as the “Industry Fund”), or such
other fund as ISPA may in its sole discretion designate at
any time during the term of this Agreement, the amount
of eight cents ($.08) for each hour worked for the Em-
ployer by those of his Employees covered by this Agreement.

Each Employer shall pay into the Chicago-Area
Laborers-Employers Cooperation and Education Trust
(“LECET”), the amount of seven cents ($.07) for each
hour worked for the Employer by those of his Employees
covered by this Agreement.

Each Employer shall pay into the Laborers’ District
Council Labor-Management Cooperation Committee
(“LDC/LMCC”), the amount of twelve cents ($.12) for
each hour worked for the Employer by those of his
Employees covered by this Agreement.

Paragraph 2. The Employer agrees to be bound by
the Agreement and Declaration of Trust establishing the
Industry Fund, as well as any amendments thereto, and
agrees to be bound by all actions taken by the Trustees of
said Industry Fund pursuant to said Agreement and
Declaration of Trust and amendments thereto. The
Employer agrees to be bound by the Agreements and
Declarations of Trust establishing the LECET and
LDC/LMCC, as well as any amendments thereto.

Paragraph 3. Inasmuch as the existence and utiliza-
tion of these Industry Fund(s) should result in increased
construction and, therefore, in increased construction job
opportunities for Employees, the Union agrees to cooper-
ate in assuring that the contributions required by this Ar-
ticle are in fact made by Employers bound by this Agreement.

Article IX
STEWARDS

Paragraph 1. The parties agree that the following
basic principles apply to the selection of a Job Steward:

(1) The Union requires that a Steward must fully
protect the interest of the Union.

23


granted the parties’ motion. A true and accurate copy of the Court’s Order is attached hereto as
Exhibit A.

2. The Company has defaulted on its obligations under the terms of the Note.
Specifically, the Company has failed to submit timely installment payments for March through
September 2013, has failed to submit the October 2013 installment payment, and has failed to
submit current benefit and dues reports for the period of August 2013 forward. Accordingly, the
Note is in default and the Defendants owe $80,266.00 on the defaulted Note representing
accelerated payments and liquidated damages on late or unpaid installments. See Affidavit of
James Fosco attached hereto as Exhibit B, § 6.

3. The Company also entered into a Contract for Cash Bond and has failed to make
its September 2013 installment. The Company owes a balance of $2,500.00 on the Contract for
Cash Bond. See Exhibit B, 7.

3. Accordingly, Plaintiffs respectfully request that the Court reinstate this case and
enter judgment in favor of Plaintiffs and against Defendants Jacobs & Son, Inc. and Kenneth M.
Jacobs in the total amount of $81,558.50 representing the $80,266.00 due on the Note including
accelerated amounts and liquidated damages due for late payments and $1,292.50 representing
Plaintiffs’ attorneys’ fees and expenses in enforcing the Note and moving to reinstate the case.
See Declaration of Patrick T. Wallace, Exhibit C, J 15.

WHEREFORE, Plaintiffs respectfully request that the Court reinstate the case and enter
judgment in favor of Plaintiffs and against Defendant Jacobs & Son, Inc. and Kenneth M. Jacobs
in the amount of $81,558.50 representing all amounts due on the Note including accelerated

amounts, liquidated damages and attorneys' fees and expenses incurred by the Funds. Plaintiffs


LABORERS’ PENSION AND WELFARE FUNDS
POLICY FOR SCHEDULING OF AUDITS

As Adopted by The Boards of Trustees
Effective as of April 1, 2006

Contributing employers to the Laborers’ Pension Fund and the Health and Welfare
Department of Construction and General Laborers’ District Council of Chicago and Vicinity
(collectively, the “Benefit Funds”), shall be audited periodically in accordance with the procedures
adopted by the Collection Committee of the Benefit Funds. The Director of the Field Department, in
cooperation with the Benefit Funds’ auditors, shall prepare a schedule for auditing contributing
employers in accordance with the following procedures.

‘Two types of audits shall be conducted: “full audits” in which payroll and other records on all
employees are examined and “sampling audits” in which a selection of payroll and other records are
tested to enable the compliance auditor to make a reasonable determination that there are no
delinquencies. A sampling audit should include a review of all types of records (e.g. payroll records,
tax records, cash disbursement records, reports to other benefit funds, etc.) Where a sampling audit
discloses delinquencies or related record discrepancies, a full audit shall be conducted.

Employers shall be scheduled for either full audits or sampling audits in groups based upon
the contribution histories of the employers. Hither a sampling or full audit shall be conducted at least
once every five (5) years. Any employer that fails to schedule an audit and submit records for review
within 45 days from the date of the audit request will be liable for all costs of compelling and
enforcing the audit request. The following procedures shall be used:

AUDIT PERIOD

1. New Employers. New employers shall be scheduled for audits within the first year in ~
which contributions to the Benefit Funds are required.

2. Honor Roll Employers. Employers with a history of adequate record keeping and timely,
payments to the Benefit Funds (“Honor Roll Employers”), shall be required to submit to audits every
three (3) to five (5) years. Following an audit showing adequate record keeping and correct
payments, such an employer shall be designated an Honor Roll Employer and shall be selected
randomly for an audit between the third and fifth year thereafter. (Such employers may opt for a
scheduled audit every three years.) An inadvertent shortage of no more than the greater of $1000 or
two percent (2%) of required contributions determined on a full audit covering three or more years of
contributions to the Benefit Funds shall not disqualify an employer from inclusion in this group.

3. Other Contributing Employers. Employers that are not classified as New or Honor Roll
Employers or who have been assessed significant delinquencies to the Benefit Funds or any of the
ancillary funds to which contributions are owed pursuant to the collective bargaining agreements of
the Laborers’ District Council shall be scheduled for full audits at least once every three (3) years,


12, Bank account statements and canceled checks from any account used in conjunction
with the employer’s business.

13. Ifrecords of all hours worked, rates of pay and classifications are not provided in the
records listed in items 1 through 10, the employer shall maintain monthly lists of all employees
not shown on payroll records, showing Social Security number and work classification (or code
or clock or ID number), rates of pay and hours worked.

Honor Roll Employers shall be required only to produce basic records needed by the
Benefit Funds’ auditors to do an audit, specifically items 1 through 7 above. However, if an
initial examination of such limited records discloses significant record keeping errors or failures
to contribute, the auditor may request additional records listed above. In the absence of evidence
of a deliberate failure by an Honor Roll Employer to contribute on behalf of a bargaining unit
employee, the rebuttable presumptions provided for in the attached Policy for Retention and
Production of Employer Records shall not apply to such Honor Roll Employer.

Notwithstanding the foregoing, the Collection Committee or the Director of the Field
Department-may, in their discretion, determine that a full audit shall be done of any employer or
that, where a sampling audit is to be conducted, specific records shall be produced. The
judgment of the trustees in interpreting and applying this policy shall be conclusive and binding
on all parties.

Adopted January 9, 2002


RESTATED AGREEMENT
AND DECLARATION OF TRUST
OF THE HEALTH AND
WELFARE DEPARTMENT OF
THE CONSTRUCTION AND

_ GENERAL LABORERS’
~ DISTRICT COUNCIL
OF CHICAGO AND VICINITY

Restated through .

_ July 1, 2003

EXHIBIT



Employee shall be permitted to contract or otherwise agree with or pemnit his Employer to
provide wage or benefit payments which do not conform with the amount of contributions
required under the provisions of a Collective Bargaining Agreement or Participation
Agreement and any such contract or agreement shall be null and void. It shall not be a
defense to any claim by the Trustees or an Employee for payment of. delinquent
contributions from an Employer that such Employer has entered into an agreement with any
Employee purporting to waive the Employee's right to strict compliance with the provisions
of the applicable Collective Bargaining Agreement or a Participation Agreement, All
contributions shall be paid in the manner and form required by the Trustees,

Section2, DEFAULTIN PAYMENT OF CONTRIBUTIONS. Nonpayment by;
an Employer of any contributions when due shall not relieve any other Employer of his
obligation to make payments. The Trustees may take any action necessary to enforce:
payment of the contributions and penalties due hereunder, including, but not limited to,
proceedings at law and in equity. Any such action shall not prejudice the Union in any
action it may wish to take on account of such nonpayment. The Trustees are authorized to
establish a reasonable and lawful grace period by which contributions must be received;
Employers making contributions that are not received before the expiration of said period
and any Employer making late payments due under an installment agreement shall be
assessed liquidated damages of 10% of the amount of the contributions which are owed.

All Employers party to or otherwise bound by this Agreement acknowledge that the


Power Drive Concrete Saws,

Other Power Equipment ......... 35.475
Cement Gun Nozzle (Laborers)

Gunite 2... eee eee 35.35
Cement Gun Laborers............ 35.275

Street Paving, Grade Separation,
Sidewalk Curb and Gutter

Strippers and all Other

Laborers ........ cece eee eee
General Foreman of Laborers . .
Superintendent .................
Foremen of Laborers ............
Asphalt Foreman. ............008
Cut-Out Foreman ...............
Street Repair Foreman ...........
Material Testing/Quality Control

Laborer ........ ee. eee ee per side letter

Apprentices (ist 6 months) .... 60% of base rate: ($21.12)
Apprentices (2nd 6 months).... 70% of base rate: ($24.64)
Apprentices (3rd 6 months) .... 80% of base rate: ($28.16)
Apprentices (4th 6 months) .... 90% of base rate: ($31.68)
Apprentices (after 24 months) .. 100% of base rate: ($35.20)

Wages must be paid by payroll check and shall
include a stub or statement showing the number of
straight time and overtime hours worked and rate of pay.

Direct Deposit. In lieu of paying wages by payroll
check, the Employer may make payment by electronic
bank draft if the employee voluntarily accepts such alter-
nate method of payment. The Employer shall not man-
date electronic banking as a condition of employment.
Electronic wage payments must be transferred to the
employee’s bank account no later than the employee’s reg-
ular pay day and at no cost to the employee. If payment
is made by electronic bank draft, the Employee must also
be provided a record of hours worked, rates of pay, and
deductions made, at the same time and containing the
same information as if wages were paid by payroll check.

10


DEBTORS:

CREDITOR:

COMMERCIAL SECURITY AGREEMENT
———-)

Jacobs & Son, Inc. (RINY = _
clo Kenneth Jacobs, Registered Agent
3901 Industrial Ave.

Rolling Meadows, IL, 60008

Kenneth M. Jacobs
1140 Derbyshire
Arlington Heights, 1L 60004

James S, Jorgensen, Administrator
Laborers! Pension and Welfare Kands
11465 W. Cermak Road
Westchester, IL, 60154

THIS COMMERCIAL SECURITY AGREEMENY is entered into between Jacobs & Son, inc. and Kenneth M.

Jacabs (collectively refersed to below as “Grantor”); and James &. Jorgensen, Administrator af the Laborers’

Peasion

Fund and Laborers Welfare Fund of the Health and Welfure Department of the Construction and Gencral Laborers!

Distri
Vie

whieh Creditor may have by law.

¢ Council of Chicago and Vicinity, and agent of the General Laborers’ District Council of Chicago and

nity Training Fund (collectively referred to below as “Creditor”), For valuable consideration, Grantor grants 10
Creditor a security interest in the amount of $165,726.31 in the Collateral to secare the indebtedness and agrees that
Creditor shall have the rights stated in this Agreement with respect to the Collateral, in addition to all other

DEFINITIONS. ‘The following words shall bave the following micanings when used in this Agreement. Terms pot

otherwise defined in this Agreement shall have the meanings attributed fo such terms in the Uniform Commer

ial

Code. All references to dollar amounts shall mean amounts in tawlul money of the United States of America.

Agreement. ‘The word “Agreement” means this Commercial Security Agreement, as Wiis Commercial
Security Agreement muy be amended or modified from time to time, together with all exhibits and

schedules attached to this Commercial Security Agreement froma time to time,

Caltateral. The word “Collateral” means the following described property of Grantor, whether now owned
or hereafter acquired, whether now cxiting or hereafter arising, and wherever located:

fa)

(by
©)

(d)

()

10)

All attachments, accessions, accessorics, tools, parls, supplics, increases,
replacements of and substitutions for any property described above,

All produc

and additions to and alt

and produce of any of the property deseribed in this Collateral section.

AN accounts, general intangibles, instruments, rents, monies, payments, and ali other rights, airing
out of a sale, lease, or other disposition af any of the properly described in this Collateral section.

Ail proceeds (including insurance proceeds) from the sale, destruction, toss, or other disposition of

any of the property described in this Collateral section.

All records and data relating fo apy of the property described in this Collateral section, whether in
the (orn: of a writing, photograph, microfilm, microfiche, or electronic media, together with all of
Grantor's right, ila, and interest in and to all computer software required to utilize, create,

maintain, and process any such records or data on cfectrenic media,

All inventor
accounts receivable,

, matorial, equipment, deposit accounts, consumer goods, investment property, and

EXHIBIT


Fax from : 17889477295 LABORS FIELD DEPT 16-25-13 10:62a Pg: 2

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LABORERS’ PENSION FUND and
LABORERS’ WELFARE FUND OF THE
HEALTH AND WELFARE DEPARTMENT
OF THE CONSTRUCTION AND GENERAL
LABORERS? DISTRICT COUNCIL OF
CHICAGO AND VICINITY, and JAMES S.
JORGENSEN, Administrator of the Funds,
Plaintiffs, Case No. 12 C 2514
vw
Judge Zagel
JACOBS & SON, INC., an Illinois corporation,
and KENNETH M. JACOBS, individually,

Defendants,
DECLARATION OF PATRICK T. WALLACE

I, PATRICK T. WALLACE, declare and state as follows:

1. Tam Fund Counsel for Plaintiffs Laborers’ Pension Fund and Laborers’ Welfare
Fund of the Health and Welfare Department of the Construction and General Laborers’ District
Council of Chicago and Vicinity (the “Laborers’ Funds”), Plaintiffs in the above-referenced
action, This Declaration is submitted in support of the Laborers’ Funds’ Motion for Entry of
Default Judgment in Sum Certain.

2. Shareholders of the law firms of Allison, Slutsky & Kennedy, out-of-house
collection counsel for the Laborers’ Funds, bill the Laborers’ Funds at a rate of $225.00 per hour
for shareholders, $195.00 per hour for associates, and $110.00 per hour for paralegals. Affiant,
as in-house counsel for the Laborers’ Funds, has first-hand knowledge that the foregoing hourly
rates have been found reasonable and have been awarded by many courts in collection

proceedings.

EXHIBIT



4, Employers Subject to Special Audits. At the discretion of the Director of the Field
Department full audits of employers obligated to contribute to the Benefit Funds may be conducted
at any time based upon information conceming possible delinquencies, e.g., failure to file monthly
remittance reports, failure to pay contractually required wage rates, information conceming a
possible closing or sale of the business, information that the employer is operating an alter ego or

similar bases suggesting possible delinquencies.

FULL AND SAMPLING AUDITS

1, New Employers. If there is a sufficient number of employees of a New Employer, the
auditor of the Benefit Funds may do a sampling audit to determine if the employer is maintaining
accurate records and making required contributions, otherwise the auditor will do a full audit. An
important purpose of audits for new employers is to. inform employers of the procedures for
contributing to the Benefit Funds and the requisite records to be maintained. *

2, Honor Roll Employers. Sampling audits shall be used for Honor Roll Employers ifthey

have sufficient employees to warrant use of sampling methods. If a sampling audit discloses
inaccurate or incomplete record keeping or evidence of significant delinquencies, a full audit shall be

done,

3. Other Contributing Employers. Full audits shall be conducted if employers are not
qualified as New or Honor Roll Employers.

4, Notwithstanding the foregoing, the Collection Committee or the Director of the Field
Department may, in their discretion, determine that a full audit shall be done of any employer or that,
where a sampling audit is to be conducted, specific records shall be produced.*

* For information concerning the requisite records to be maintained, see the Laborers’ Pension
and Welfare Funds Policy for Retention and Production of Employer Records, effective as of
April 1, 2006 and the Records Required to be Retained By Employers and Produced for Audits

adopted January 9, 2002.



Way-08-2007 12:25pm = Fron-Laborers’Pen & Wel Funds

TH351) P.UUPFUU Feb ID

. WHEREAS, the Trustees have concluded that such Deadbeat Employers’ practices result
in unfair competition for other contributing Employers often with the result of enriching
themselves and depriving lawful Employers of needed work, and depriving the Fund’s

participants of benefits;

WHEREAS, it is the desire of the Trustees 10 amend the Trust Agreement in order
expressly to provide that the Fund may impose appropriate protective financial requirements on
any Employer that is owned by or that hires a Deadbeat Employer in a managerial or supervisory

Tole;

__ NOW THEREFORE, the undersigned Trustees of the Fund, pursuant to the authority of
Article XII of the Restated Agreement and Declaration of Trust, do hereby adopt the following
Amendment to the Restated Agreement and Declaration of Trust effective as of August 1, 2006:

L

The following is added as an additional Paragraph under Article Y, “Certain
Definitions”, Section 2, “Employer”:

“A ‘Deadbeat Employer” is defined as any entity or individual (including, but not limited
to a corporation, parmership, or sole Proprietorship and its respective officers, parmers or
owners) who have, or previously had in the last 10 years, incurred substantial liability to the
Fund for delinquent contributions and then ceased operations or became insolvent, without
satisfying such substantial liability and without any reasonable likelihood of paying the amounts
due to the Fund. For purposes of this Section, substantial liability shall not be less than $30,000.”

q.

The following is added as Section (4) to Article VI, “Employer Contributions”:

“Section 4. DTI E ‘SF EAT EMPLOYERS.

(a) LO’ fe) BEAT. YER. Subject to the provisions
of subsection (c) and following 30 days after receipt by the Employer of the Notice described
therein, any Employer that is owned, whether in whole or in part, by a Deadbeat Employer shall
be deemed by the Fund as a successor employer to the Deadbeat Employer for purposes of the

delinquent contribution obligations of the Deadbeat Employer to the Fund and shall (1) be liable

to the Fund for the unpaid liabilities of the Deadbeat Employer and (ii) be required to post a bond
for the benefit of the Fund in an amount equal to twice the amount of the Deadbeat Employer’s

prior delinquencies to the Fund.

(b) OP. By _D! AT EMPLOYER. Subject to the
provisions of subsection (c) and following 30 days after receipt by the Employer of the Notice
described therein, any Employer whom the Trustees reasonably believe employs an officer,
partner or owner of a Deadbeat Employer in a managerial or supervisory position or in any other
responsible position in which the Deadbeat Employer may exercise any control over the assets of



ing entitlement to benefits, and whether and to what
extent benefits are to be provided for covered Employees.

The failure of the Employer to contribute to the said
Welfare or Pension Fund, as provided herein, shall for the
purposes of the remedies the Union may pursue, be
deemed the same as the failure of the Employer to pay
wages, and the Union shall be permitted to remove work-
ers whom they represent for non-payment of such contri-
butions, anything to the contrary in this Agreement
notwithstanding.

A grace period of thirty (30) days shall be granted
for Employers to submit reports and contributions as pro-
vided. Said reports and contributions not received during
this grace period shall be assessed liquidated damages
amounting to ten (10%) percent of the amount of the
contributions which are owed. The Employer acknowl-
edges that the liquidated damages shall be used to defer
administrative costs arising by said delinquency and
acknowledges the costs to be actual and substantial,
though difficult to ascertain. However, the Employer
acknowledges these costs to be at a minimum of ten
(10%) percent, waiving the necessity of any additional
proof thereof. In addition, the delinquent contributions
shall bear interest at a maximum legal rate of interest per
annum from the due date until they are paid.

Further, in the event the Trustees refer the account to
legal counsel for collection, the delinquent Employer shall
be liable for reasonable attorneys’ fees, and for all reason-
able costs incurred in the collection process, including
court fees, audit fees, etc.

Reasonable attorneys’ fees shall mean: All reason-
able attorneys’ fees in the amounts for which the Trustees

become legally bound to pay, including recovery of liqui-
dated damages, interests, audit costs, filing fees, and any
other expenses incurred by the Trustees.

The Trustees of the aforementioned Welfare and
Pension Funds and the Union shall have the authority to

13