EXHIBIT
10.1


 


CLASS ACTION SETTLEMENT AGREEMENT


 


THIS SETTLEMENT AGREEMENT (hereinafter “Agreement”) is entered into and
effective upon its execution by all parties hereto. It is entered into by and
between all members of the “Plaintiff Class,” part of which has previously been
certified (as identified and defined in paragraph 3 below), including the
court-approved “Named Plaintiff” (as identified hereafter), on the one hand,
and ALLSTATE INSURANCE COMPANY (hereafter referred to as “Defendant” or “Allstate”),
on the other hand, with reference to the following recitals and provisions:


 


RECITALS


 


A.            Certain claims,
demands and differences have existed heretofore between the Plaintiff Class and
Defendant, including Plaintiff Class’ contention that Defendant failed to pay
members of the Plaintiff Class (“Class Members”) overtime pay and/or
to provide them paid rest breaks and/or unpaid meal periods (collectively, “Breaks”)
as required by law and Defendant’s contention that the Class Members are
exempt from such requirements.


 


B.            The Plaintiff Class and
Defendant are parties to a civil action, bearing case number BC 240 813 pending
in the Superior Court of the State of California for the County of Los Angeles
(“the “Court”), entitled William Sekly vs. Allstate
Insurance Company, and filed on or about November 27, 2000 (“the
Lawsuit”).


 


C.            The operative
complaint in the Lawsuit shall be the amended complaint (the “Class Complaint”)
referred to in paragraph 5 below, which alleges, among other things, that
Defendant improperly classified the Class Members as exempt employees,
misrepresented that such Class Members were exempt employees, and failed
to pay overtime compensation and/or to provide Breaks to such Class Members.
Defendant denied said allegations in their entirety and alleged that the Class Members
were properly classified as exempt employees and that any and all compensation
and/or Breaks due to such Class Members was paid and/or provided according
to law.


 


D.            The matter has been
litigated before the Hon. Anthony Mohr, Judge of the Court.


 


E.             On August 23,
2002, the Court, over Defendant’s objection, certified this matter as a class
action for the determination of the issue of liability, and on January 19,
2005, the Court, again over Defendant’s objection, further certified this
matter as a class action for the determination of damages.


 


F.             The Court has
approved the following law firms as “Class Counsel” for the Plaintiff
Class:


 


Marlin & Saltzman

The R. Rex Parris Law Firm

Mazursky, Schwartz, Daniels & Bradley


 


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Action Settlement Agreement


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G.            The Court appointed
the following individuals as representative plaintiffs:


 


Dani Bednar

William Sekly


 


Thereafter, on or about March 17, 2005, Ms. Bednar was permitted
to withdraw as a class representative, but she remains a Class Member.  Prior to that time, she executed all of the
duties of a class representative.


 


H.            Throughout the
prosecution of this litigation, Defendant has been represented by:


 


Latham & Watkins LLP
Seyfarth Shaw,
LLP


 


I.              On April 21,
2004, the Court entered its order granting the motion by the Plaintiff Class for
summary adjudication of the issue of liability, determining that the members of
the then-certified Plaintiff Class were non-exempt production workers
entitled to overtime compensation.


 


J.             On or about January 1,
2005, Defendant commenced classifying all members of the Plaintiff Class as
non-exempt employees. It is the position of Class Counsel that the action
brought by plaintiffs herein was a significant factor, along with other events,
in causing Allstate to change its policy. Defendant disputes this and asserts
in this regard that, at the same time it changed that classification, it
reclassified as non-exempt other job classifications that are specifically
excluded from the Plaintiff Class.


 


K.            The parties have
conducted substantial formal discovery and investigation, and have researched
and briefed the legal and factual issues relating to the claims and defenses of
the action, and of all the claims contained in the Class Complaint.


 


L.             The parties have
engaged in substantial negotiations over the course of several months. During
that time, they have engaged the services of an independent mediator, Justice
Edward Panelli, who is a retired justice of the California Supreme Court.


 


M.           The mutual costs and
risks and hazards of continuing to prosecute and defend the litigation have led
the parties to resolve the case by way of settlement.


 


N.            Allstate has denied
and continues to deny each of the claims and contentions alleged by the Class Complaint.
Allstate has repeatedly asserted and continues to assert defenses thereto, and
has expressly denied and continues to deny any wrongdoing or legal liability
arising out of any of the facts or conduct alleged in the Class Complaint.
Allstate also has denied and continues to deny, inter alia,
the allegations that the Class Members have suffered damage; that Allstate
mis-classified any Class Members as exempt employees; that Allstate failed
to provide any Class Members Breaks to which they were entitled; that
Allstate failed to pay any Class Members waiting time penalties and/or any
other penalties to which they claim to be entitled; that Allstate unlawfully
converted wages due Class Members; that Allstate engaged in any unlawful,
unfair or fraudulent business practices; that Allstate engaged in any wrongful
conduct as alleged in the Class Complaint; or that any Class Members
were harmed by any conduct alleged in, or that


 


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could have been alleged in, the Class Complaint.  Neither this Agreement, nor any document
referred to or contemplated herein, nor any action taken to carry out this
Agreement, is, may be construed as, or may be used as an admission, concession
or indication by or against Allstate of any fault, wrongdoing or liability
whatsoever.


 


O.            It is the intention of
the parties to this Agreement to settle and dispose of, fully and completely,
any and all claims, demands and causes of action set forth in the Class Complaint
as described hereafter and any related claims, as between the Plaintiff Class and
Defendant, as more fully set forth in paragraphs 15 through 18 of this
Agreement.


 


PROVISIONS 


 


1.             COOPERATION BY
THE PARTIES


 


The Plaintiff Class, Defendant and their counsel agree to cooperate
fully with each other to promptly execute all documents and take all steps
necessary to effectuate the terms and conditions of this Agreement.


 


2.             APPOINTMENT OF
REFEREE


 


The parties have stipulated to, and have obtained the Court’s order
approving of, the appointment of the Hon. Edward Panelli (Ret.) as the Referee
in this matter. Said appointment shall be to assist the Court in effectuating
the settlement of this case. In that regard, the Referee shall perform the
following:


 


(a)           Meet and confer with the parties and mediate any
disputes concerning this Agreement.


 


(b)           Conduct a hearing concerning preliminary approval of
the terms and conditions of the settlement. Said hearing shall be conducted in
public.


 


(c)           Report, in writing, to the Court concerning
preliminary approval of the terms and conditions of the proposed settlement and
make a recommendation to the Court as to the granting or denial of preliminary
approval.


 


(d)           If at the time the Referee reports to the Court
concerning preliminary approval of the settlement it is the Referee’s
recommendation that preliminary approval should be granted, the Referee shall
also present to the Court a form of class notice approved by the parties, and a
method of distribution of notice approved by the parties, which the Referee
believes meets due process requirements.


 


(e)           If the Court grants preliminary approval of the terms
and conditions of the settlement and approves the proposed form and method of
class notice, the Referee shall hold a final fairness hearing. Said hearing
shall be conducted in a public courtroom and shall not commence prior to 10:00 a.m.
on October 24, 2005, or on such date thereafter as set by the Referee.  At the conclusion of that hearing, the
Referee shall report his findings to the Court. Included in this report shall
be a summary of any timely and proper objections received, the


 


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Referee’s recommendation as to the granting
of final approval, and such other matters as the Referee deems appropriate to
bring to the Court’s attention.


 


(f)            After final approval by the Court, the Referee shall
determine the timeliness of Claim Forms (as set forth in paragraph 7 below) and
shall resolve any dispute by any Class Member as to any factor or issue
regarding the computation of that Class Member’s Individual Settlement
Award (as defined below), and the Referee’s decision on any such issue or
dispute shall be final and binding.


 


3.             DEFINITION OF
THE PLAINTIFF CLASS


 


(a)           For purposes of this settlement only, the parties
agree that the “Plaintiff Class” is defined as follows:


 


(1)           All persons who, at any time between November 27,
1996 and December 31, 2004 (the “Class Period”) were employed by
Allstate in California as claims adjusters. 
As used in this definition, the term “claims adjuster” refers to any
individual whose primary assigned duties as an employee of Allstate included or
currently include, but were not limited to, the adjustment and/or investigation
and/or analysis and/or evaluation of the monetary worth of any claim made to
Allstate for any bodily injury, property damage, and/or monetary damage of
every nature and type and who were paid as exempt employees during the Class Period
as the same are defined pursuant to statute and/or California or federal
regulatory determination.


 


(2)           The job titles specifically encompassed by the
definition of “claims adjuster” include, from various times during the Class Period:


 


Claim Representative


Senior Claim Representative


Staff Claim Representative


Senior Staff Claim Representative


Staff Claim Analyst


Claim Adjuster


Senior Claim Adjuster


Staff Claim Adjuster


Senior Staff Claim Adjuster


Staff Claim Analyst


Claim Service Adjuster


Senior Claim Service Adjuster


Staff Claim Service Adjuster


Appraisers


Claims Specialist


Claims Consultant


Evaluation Consultants


Damage Evaluators


Quality Evaluators


Extra Contractual Liability Specialists


 


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Although the Court previously
ruled that claims adjusters in the Special Investigation Unit and/or as
Subrogation Adjusters were not included in the Plaintiff Class, and although
Evaluation Consultants, Damage Evaluators, Quality Evaluators and Extra
Contractual Liability Specialists were previously excluded from the Plaintiff
Class, the Plaintiffs and Allstate have expressly agreed that such persons
shall be included in the Plaintiff Class in order for this settlement to
be effectuated, and the negotiations specifically included and contemplated
said persons being in the Plaintiff Class.


 


(3)           Any change, modification, addition or deletion of any
job titles by Defendant shall not result in a change in the persons defined as Class Members.


 


(b)           Persons expressly excluded from the Plaintiff Class:


 


Persons who performed such functions while classified, employed and
compensated by Allstate as supervisors, managers or officers of Allstate are
not included in the Plaintiff Class during any time said persons were so
employed.  Persons performing work in the
following job titles (as the work duties and responsibilities of said titles
existed as of the date of certification) are not included in the defined class
during any period of time said position was held during the Class Period:
Frontline Process Experts, Frontline Performance Leaders and supervisory
personnel.


 


(c)           Previous opt-outs from the Plaintiff Class:


 


The parties recognize that certain persons previously elected to opt
out of the Plaintiff Class either at the time notice of class
certification for liability or notice of class certification for damages were
served, and that, by agreement of the parties made prior to this Agreement,
certain of those persons have been permitted to opt back into the Plaintiff
Class.  The parties have expressly agreed
as part of the consideration for this Agreement, that all persons who
previously opted out but have not previously opted back in shall be permitted
to opt back into the Plaintiff Class by the timely submission of a Claim Form as
described in paragraph 7 below, and that the negotiations specifically included
and contemplated said persons being given such opportunity.  Any such person who fails to submit a timely
Claim Form will remain excluded from the Plaintiff Class.


 


(d)           Allstate’s waiver of objections to the Plaintiff
Class:


 


Solely for the purposes of implementing this
Agreement and effectuating the settlement, Allstate stipulates that the Court
may enter an order preliminarily certifying the Plaintiff Class and
appointing the Named Plaintiff as representative of the Plaintiff Class.
Allstate expressly reserves its rights to challenge the propriety of the
previous orders of class certification issued by the Court for any purpose
should this Agreement not be approved or become effective.


 


4.             CONSIDERATION BY
DEFENDANT


 


In consideration for the releases and dismissals set forth in
paragraphs 15, 16 and 17 below, Defendant agrees to (1) payment to Class Members
pursuant to the payment procedure as described in paragraphs 7 and 8 herein; (2) the
payment of attorneys’ fees, costs and expenses, as


 


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set forth herein and as awarded by the Court;
and (3) the payment of the cost of administration of the settlement,
including all fees of the Referee and of the third party claims administrator
selected by Class Counsel (hereinafter, the “Administrator”), all subject
to the limitations contained in sub-paragraphs (a) and (b) hereafter.


 


(a)           “Potential Maximum Consideration” to be paid by
Defendant:


 


The “Potential Maximum Consideration” to be
paid by Defendant is the total sum of One Hundred Twenty Million Dollars
($120,000,000). The payment by Defendant shall be “all inclusive,” including,
but not limited to:  unpaid overtime pay,
and any penalties, premium pay or damages associated with or related to such
alleged violations, including possible penalties under the Private Attorneys
General Act of 2004 (“PAGA”); pay for Breaks, and any penalties, premium pay or
damages associated with or related to such alleged violations, including
possible penalties under the PAGA; interest, costs, attorneys’ fees, class administration
costs, referee costs, incentive payments to class representatives (both current
and former), employee-paid and employer-paid withholding and payroll taxes
(including, without limitation, state and federal income taxes, social security
contributions and unemployment taxes) and all other settlement-related payments
and costs.  However, any costs
(independent of costs incurred by the Administrator) incurred as a result of
Defendant issuing settlement payments to Class Members and/or Class Counsel
shall be borne by Defendant.  In the
event Defendant elects to have the Administrator distribute settlement
proceeds, such costs shall be borne by Defendant.


 


(b)           Attorneys’ fees and costs:


 


Defendant acknowledges that Class Counsel will apply to the Court
for an award of attorneys’ fees and reimbursement of costs and expenses
incurred in the prosecution of this matter for the benefit of the Plaintiff
Class. The parties agree that, subject to the approval of the Referee and the
Court as set forth hereafter, Class Counsel will seek attorneys’ fees as a
percentage, not to exceed 33-1/3% of the total Potential Maximum
Consideration.  Any attorneys’ fees,
costs and expenses approved by the Court shall be subtracted from the Potential
Maximum Consideration.


 


5.             FILING
OF CLASS COMPLAINT


 


On or before August 31, 2005, Class Counsel shall file an
amended complaint, hereinabove and hereafter referred to as the “Class Complaint,”
asserting various allegations on behalf of the Plaintiff Class (as defined
in paragraph 3 above), which have been included in the ongoing negotiations,
including meal and rest period violations; for all penalties, premium pay or
damages associated with or related to alleged overtime violations or meal and
rest period violations, including possible penalties under the PAGA; overtime
violations under the federal Fair Labor Standards Act (“FLSA”); and for all
other remedies or penalties which may or may not be available under the PAGA,
the California Labor Code, or the wage orders issued by the California
Industrial Welfare Commission (“Wage Orders”). Defendant shall stipulate to
allow the filing of the Class Complaint in compliance with this provision.
All the material allegations of the Class Complaint are deemed denied
without the necessity of Allstate filing an Answer to the Class Complaint.


 


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6.             FILING OF
STIPULATION TO CERTIFY PLAINTIFF CLASS


 


Contemporaneous with the filing of the Class Complaint, the parties
shall file a joint stipulation to certify the Plaintiff Class as defined
herein for purposes of settling the Lawsuit.


 


7.             NOTICE OF
SETTLEMENT AND CLAIM FORM; TIME TO SUBMIT CLAIMS


 


(a)           Notice of Settlement (“Notice”)


 


Class Members will be provided with notice of the terms and
conditions of this settlement in a form of notice approved by the Referee and
the Court and attached hereto as Exhibit “A”. The Notice shall be
accompanied by a “Claim Form/FLSA Consent Form” (“Claim Form”) approved by the
Court and attached hereto as Exhibit “B”, an “Exclusion Request Form”
approved by the Court and attached hereto as Exhibit “C” and a postage
paid envelope pre-addressed to the Administrator, and shall inform Class Members
of


 


(1)           the terms of the settlement;


 


(2)           the fact that persons previously excluded or not
previously included in the Plaintiff Class may elect to exclude themselves
from participation by executing and returning the Exclusion Request Form within
thirty (30) days of the date Notice is mailed;


 


(3)           the fact that a Class Member who previously
elected to exclude himself or herself from the Plaintiff Class may, by
submitting a timely and valid Claim Form (as described hereafter), be
included in the Plaintiff Class for settlement purposes (and that if he or
she fails to submit a Claim Form, he or she will remain excluded and will not
be a Class Member);


 


(4)           that Class Members shall have until the
seventy-fifth (75th) day after mailing of the Notice (the “Submission
Date”) to submit their Claim Form, or a copy thereof, to the Administrator; and


 


(5)           the name and address to which the Claim Form must
be returned and that the enclosed postage paid and pre-addressed envelope may
be used to return the Claim Form to the Administrator.


 


(b)           Claim Form


 


The Claim Form shall inform each Class Member


 


(1)           that by submitting a Claim Form, the Class Member
agrees to participate in the settlement for FLSA purposes and thereby waive any
additional rights the Class Member may have pursuant to the FLSA;


 


(2)           that the Class Member is shown by Allstate’s
records to have worked in the Plaintiff Class for a specified number of
months and for a specified number of days as a catastrophe (“CAT”) adjuster in
each year in the Class Period, and that the Class Member


 


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has
the right to dispute any such information and to submit documentation in
support of such dispute;


 


(3)           that to submit a valid claim the Class Member
must declare under penalty of perjury that he or she worked overtime for
Allstate as a Class Member during the Class Period, and that the Class Member
may be asked to provide certain identifying information;


 


(4)           that the failure to make this declaration or to
provide accurate identifying information upon request shall make the Class Member’s
Claim Form defective; and


 


(5)           that the Class Member shall have until the
Submission Date to submit his or her Claim Form, or a copy thereof, to the
Administrator.


 


Class Counsel shall also post a blank
copy of the Claim Form on their website and Class Members may
download the same for use in presenting their claim.


 


(c)           Mailing of Notice and Claim Form


 


The Administrator shall send the Notice, Claim Form, Exclusion Request Form and
return envelope to all Class Members via first class U.S. Mail.  The Administrator shall perform one skip
trace as to any Notices and Claim Forms that are returned by the post office
for invalid addresses.  Those Class Members
who receive notice pursuant to the one skip trace shall be informed (via an
insert in the notice) that his or her time to submit a claim shall be the later
of (i) thirty (30) days from the date notice is mailed to the updated
address, or (ii) the Submission Date. Class Counsel and Defendant’s
counsel shall be advised by the Administrator of the identity of all Class Members
who were sent notice as a result of a skip trace and whose notice was again
returned within seven (7) days of receipt of same by the Administrator.


 


(d)           Time for Submission of Claim Forms


 


(1)           Except as set forth in paragraphs 7(e) and 7(f) below,
to be considered timely, a Claim Form must be submitted to the
Administrator on or before the Submission Date.


 


(2)           Those Class Members who receive notice pursuant
to the one skip trace shall have until the later of (i) thirty (30) days
from the date notice is mailed to the updated address, or (ii) the
Submission Date to submit a claim.


 


(3)           The submission of a claim will be deemed completed on
the earlier of the date of receipt by the Administrator or the postmark date on
the envelope containing the Claim Form.


 


(4)           A Class Member who submits a timely and properly
completed Claim Form shall be a “Settlement Class Member.”


 


(e)           Defective Claim Forms


 


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A Claim Form shall be defective if a Class Member fails to
make the required declaration or fails to provide accurate identifying
information upon request. If the Administrator receives a defective Claim Form,
the Administrator shall return the Claim Form to the Class Member via
first class mail and instruct the Class Member that he or she has until
the later of (i) thirty (30) days or (ii) the Submission Date within
which to correct and/or complete the Claim Form and/or provide the
requested information and return it via first class mail. If a completed Claim Form is
not received within said time frame, the Claim Form shall be considered
defective and invalid for purposes of this settlement. The Administrator will
provide the identity of Class Members who submitted defective Claim Forms
to Class Counsel and Defendant’s counsel at the same time a Class Member
is notified that his or her Claim Form is defective. Class Counsel
shall be notified of the identity of Class Members who do not correct
defective claims forms within the time allowed therefore.  Class Counsel may then contact those Class Members,
and if a correct Claim Form is received within twenty (20) days after the
Administrator has so notified Class Counsel, it shall be accepted as
timely.


 


(f)            Late Claims


 


Any claim submitted after the applicable time limits described in
paragraph 7(e) shall be handled as follows:


 


(1)           Class Members submitting late claims shall be
informed by the Administrator that their claims are late and shall have an
opportunity to present the Referee with a written statement, under penalty of
perjury, within ten (10) days of being so informed as to the basis for
their claim being late.


 


(2)           The Referee shall have the sole discretion to approve
or disapprove all such claims in accordance with the following:


 


[a]           If the claim was initially submitted on or before January 31,
2006, the Referee shall determine whether the claim was submitted late due to
an invalid mailing address.  If so, the
claim shall be considered as having been submitted on time and the person
submitting such claim shall be a Settlement Class Member.  If the claim was submitted late for any other
reason, the Referee shall determine whether the reason is appropriate and if
so, it shall be considered a “Late Claim” and shall be computed and paid
separately from timely claims as set forth in paragraph 8(f) below and the
person submitting such claims shall be a “Late Claim Settlement Class Member.”  If the Referee determines that the reason is
inappropriate, the claim shall be rejected as untimely.


 


[b]           Any claim that is submitted later than February 28,
2006 (the “Final Submission Date”), regardless of the reason, shall be rejected
as untimely.


 


(3)           All determinations made by the Referee under this
paragraph (f) shall be final and binding.


 


(g)           Retention of Claim Forms


 


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The Claim Forms shall be maintained by the Administrator until the
Final Submission Date.  At that time, the
forms shall be provided to Defendant for use in distributing the settlement
proceeds. However, at no time shall any such form (1) be used in any
proceeding or action regarding the potential discipline of any individual
employee, (2) be placed (or a copy placed) in any individual employee’s
personnel file, or (3) be provided to any manager or supervisor at the
claims office level or below. The purpose of the previous sentence is to ensure
that no current or former employee could, in any way, be negatively impacted by
the fact of filing a claim.


 


8.             PAYMENT TO CLASS MEMBERS
AND CLAIMS PROCEDURE


 


(a)           Potential Gross Individual Settlement Proceeds.


 


The “Potential Gross Individual Settlement Proceeds” shall equal the Potential
Maximum Consideration minus the total of (i) Court-approved attorneys’
fees; (ii) Court-approved reimbursement of costs and expenses; (iii) Court-approved
expenses incurred by the Referee; (iv) Court-approved incentive awards to
the current and former named class representatives; (v) all administrative
costs relating to the claims process, (except those costs resulting from
Defendant’s election to have the Administrator issue settlement checks); and (vi) the
Late Claim Reserve described in paragraph 8(f) below.


 


(b)           Annual Percentage; Potential Annual Gross Settlement
Proceeds


 


Each calendar year during the Class Period shall be assigned an “Annual
Percentage.” That percentage shall equal (i) the total compensation to all
Class Members during that year plus imputed interest calculated at seven
percent (7%) per annum simple interest through December 31, 2004, divided
by (ii) the sum of all such compensation and all such imputed interest for
all calendar years in the Class Period. 
As used herein, a Class Member’s total compensation for a calendar
year shall be the amount reported in Box 1 of the member’s W-2 form for that
year, (prorated to the nearest full month for any year in which a Class Member
was not actively employed in the Plaintiff Class for the entire year). The
Annual Percentage shall then be multiplied by the Potential Gross Individual
Settlement Proceeds to determine the “Potential Annual Gross Settlement
Proceeds” allocable to that calendar year. 
Of the total amount so allocated, the percentage allocable to imputed
interest shall be interest and the remainder shall be, in the appropriate
percentages, wages (subject to withholding) and employer-paid payroll taxes on
such wages.


 


(c)           Individual Percentage


 


Each Class Member’s “Individual Percentage” of each Potential
Annual Gross Settlement Proceeds shall equal (i) the gross compensation
earned by that Class Member for the months in each calendar year that such
Class Member worked as a Class Member divided by (ii) the total
gross compensation paid to all Class Members for all of the months worked
by Class Members during such year of the Class Period.  For purposes of this calculation, every Class Member
who was employed as a CAT adjuster at any time during such year shall have his
or her annual gross compensation for that year increased by a factor equal to
sixty percent (60%) times the ratio of the number of days that Class Member
worked as a CAT adjuster that year over 365. 
It is


 


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understood that Individual Percentages for Class Members
who worked as CAT adjusters in any year will be increased, and the Individual
Percentages for Class Members who did not work as CAT adjusters shall be
correspondingly reduced.  For purposes of
1996 only, any person who was a Class Member for at least two weeks
between November 27 and December 31, 1996 shall be credited with one (1) month,
and CAT adjuster duty shall not be considered.


 


Example: 
If a Class Member worked during a year in the Class Period and
earned a total of $1, and the total gross compensation paid out to Class Members
during that year, after adjustments for
CAT duty, was $100, that Class Member’s Individual Percentage would
be 1 percent (1/100) of the Potential Annual Gross Settlement Proceeds for that
year.


 


(d)           Individual Settlement Award


 


Each Class Member’s “Individual Settlement Award” shall equal the
sum of his or her Individual Percentages of each Potential Annual Gross
Settlement Proceeds and shall be comprised of interest, wages (subject to
withholding) and employer-paid payroll taxes on such wages in the same
appropriate percentages as the respective Potential Annual Gross Settlement
Proceeds.  The portion of each Individual
Settlement Award that is not interest shall be divided by the appropriate
divisor to determine the Class Member’s gross wages (subject to withholding)
and the balance shall be the employer-paid payroll taxes with respect to such
gross wages.


 


(e)           Claimed Settlement Amount; Unclaimed Amount


 


The total of Individual Settlement Awards claimed by Settlement Class Members
shall be the “Claimed Settlement Amount.” If each and every Class Member
is a Settlement Class Member, then the Claimed Settlement Amount shall
equal the Potential Maximum Consideration and all Individual Settlement Awards
shall be distributed to all Settlement Class Members. If any Class Member
does not become either a Settlement Class Member or a Late Claim
Settlement Class Member, the following shall apply:


 


The value of the Individual Settlement Award for a Class Member
who is not a Settlement Class Member or a Late Claim Settlement Class Member
shall be determined by the Claims Administrator and allocated to the “Unclaimed
Amount.”  The first Six Million Dollars
($6 million) plus one-half (1/2) of any amount over Six Million Dollars ($6
million) in the Unclaimed Amount shall be distributed to Settlement Class Members
on a pro rata basis where the numerator equals each Settlement Class Member’s
Individual Settlement Award and the denominator equals the sum of the
Individual Settlement Award for all Settlement Class Members.  Each allocation shall be interest, wages
(subject to withholding) and employer-paid payroll taxes on such wages in the
same proportions as each Settlement Class Member’s Individual Settlement
Award.  The balance of the Unclaimed
Amount (one-half (1/2) of any amount over Six Million Dollars($6 million))
shall be retained by Allstate.


 


(f)            Late Claim Settlement Members; Late Claim Reserve


 


A total of Five Hundred Thousand Dollars ($500,000) (the “Late Claim
Reserve”) shall be held aside from the Potential Maximum Consideration to cover
the payment of Late Claims as defined in paragraph 7(f).  Any Late Claim Settlement Class Member shall
be entitled to


 


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payment of an Individual Settlement Award as
if such claim had not been late, and computed on the same basis as if it
represented a share from the Potential Gross Individual Settlement Proceeds,
except that (i) all such claims paid to Late Claim Settlement Class Members
shall be paid solely from the Late Claim Reserve; (ii) the total of all
such claims shall not exceed such reserve; and (iii) Late Claim Settlement Class Members
shall not participate in the distribution of the Unclaimed Amount under
paragraph 8(e).  If the total of the
claims made by Late Claim Settlement Class Members exceeds the Late Claim
Reserve, all such claims shall be reduced proportionately so that the total
paid does not exceed $500,000.  If the
total of the claims by Late Claim Settlement Class Members is less than
$500,000, the unused portion of the Late Claim Reserve shall be retained by
Allstate.


 


(g)           Tax Liability and Net Payments


 


The payment by Defendant pursuant to this Agreement is for alleged
failure to pay overtime compensation, interest on said sum, and all other
claims as set forth in the operative Class Complaint (as described in
paragraph 5 herein). In accordance with both State and Federal tax laws,
Defendant shall withhold such sums from each Class Member’s Individual
Settlement Award as is required in order to comply with the same. Portions of
any Individual Settlement Award not subject to withholding will be issued with
a 1099 form. After appropriate tax withholding, the net payment to be received
by each Settlement Class Member shall be designated as the “Net Payment,”
and said sum shall be paid as provided in paragraph 13 below. Defendant shall
report the taxes withheld from the wages of each Class Member as required
via a W-2 form, and shall pay over all such withheld funds, plus the employer’s
contribution, to the appropriate State and Federal taxing authority as required
by law. Defendant shall provide each Class Member with appropriate
documentation setting forth the amount of any tax or other payment withheld,
and employer contribution made, in accordance with State and Federal tax
requirements. In addition, Defendant shall provide such information to the
Administrator and to Class Counsel. 
Class Members shall be responsible for remitting to State and/or
Federal taxing authorities any other applicable taxes due and shall hold
Allstate harmless and indemnify it for any liabilities, costs and expenses,
including attorney fees, caused by any such taxing authority relating in any
way to the tax treatment of the payments made pursuant to this Agreement.


 


(h)           Challenges to Number of Months or CAT Days Allocated
to Each Employee by Allstate and/or to Computation of Individual Settlement
Awards


 


(1)           If a Class Member disagrees with Allstate’s
calculation as to his or her number of months of employment or the number of
CAT days worked which are used to determine the Class Member’s share of
the Claimed Settlement Amount, said disagreement must be set forth in writing
and returned to the Administrator at the time that the Class Member’s
Claim Form is submitted.  Allstate will
have ten (10) days from notice of such dispute from the Administrator
within which it may respond in writing to the Class Member, the
Administrator and Class Counsel or the Class Member’s challenge shall
be deemed correct.  The Class Member
shall then have fifteen (15) days to provide a reply to Allstate’s response, if
he or she so desires.  Thereafter, the
Referee shall decide the number of months to be allocated to that Class Member
and the Referee’s decision shall be final and binding.


 


Class Action Settlement Agreement


Page 12













 


(2)           If a Class Member disagrees in any way with the
computation of his or her Individual Settlement Award, such dispute must be
communicated in writing to the Administrator within ten (10) days of the
notice of such award.  Thereafter,
Allstate and/or the Administrator will have ten (10) days to respond in
writing to the Class Member. 
Thereafter, the Referee shall decide the amount of such Individual
Settlement Award and the Referee’s decision shall be final and binding.


 


9.             ADMINISTRATION
OF POTENTIAL MAXIMUM CONSIDERATION


 


(a)           At no time shall Allstate have the obligation to
segregate the funds comprising the Potential Maximum Consideration from its
other assets. Allstate will retain exclusive authority over, and responsibility
for, those funds until paid.


 


(b)           The Administrator, will calculate the net amounts to
be paid to the Settlement Class Members and Late Claim Settlement Class Members
from the Potential Maximum Consideration in accordance with the terms and
provisions of this Agreement. In the event Allstate requests that the Administrator
pay the net amounts to be paid to Settlement Class Members, Allstate shall
bear all costs and expenses incurred in employing the Administrator in this
manner. Class Counsel will be provided access to all calculations and all
data forming the basis for such determinations. The Court shall retain
jurisdiction over the correctness of such calculations and the amount of
payment due, and the parties shall submit any disagreements regarding these
issues to the Referee for determination.


 


(c)           No person shall have any claim against Allstate,
Allstate’s Counsel, the Named Plaintiffs, the Plaintiff Class, Class Counsel
or the Administrator based on distributions and payments made in accordance
with this Agreement.


 


(d)           The maximum amount Allstate can be required to pay
under this Settlement for any purpose is One Hundred Twenty Million Dollars
($120,000,000), with the exception of the cost involved with having the
Administrator issue settlement checks if so requested by Allstate.


 


10.          PRELIMINARY
APPROVAL


 


The parties shall jointly seek preliminary approval of this settlement
from the Referee via ex parte application made in public. The Referee shall be
asked to approve the terms of the settlement, the Notice, the method of notice,
the Claim Form, the procedure for the calculation of claims, and the attorneys’
fees and costs and expenses sought by Class Counsel, all as part of
preliminary approval. The Referee shall report his findings concerning
preliminary approval in writing to the Court. The Court will be asked to adopt
the findings of the Referee and issue an order granting preliminary approval.


 


11.          FINAL APPROVAL


 


The Notice shall contain a date, time and location for a “Final
Approval (Final Fairness) Hearing” to be conducted by the Referee. Said hearing
shall be held in a courtroom in Los Angeles County and shall be held on a date
approved by the Court on or after October 24, 2005 at a time no earlier
than 10:00 a.m.


 


Class Action Settlement Agreement


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If, after receiving the Referee’s written report concerning the Final
Approval Hearing (and if that report recommends final approval), the Court is
in agreement with the recommendation of the Referee, the Court will grant final
approval of the settlement. If the Court is not in agreement with the Referee’s
findings, the Court will refer the matter back to the Referee for such other
proceedings as may be appropriate.


 


If final approval is granted by the Court, the Referee shall be
empowered to hear any remaining disputes between the parties, to resolve
administrative and or procedural problems, etc. Except as set forth in
paragraph 2(f), all such actions shall be subject to ratification by the Court.


 


12.          PROCEDURE FOR
OBJECTIONS TO SETTLEMENT


 


The Notice shall provide that Class Members who wish to object to
the Settlement must file with the Referee and serve on counsel for the parties
a written statement objecting to the settlement. Such written statement must be
filed with the Referee and served on counsel for the parties no later than
thirty (30) days after the date the Notice is first mailed (the “Objection
Deadline Date”). No Class Member shall be entitled to be heard at the
Final Approval Hearing (whether individually or through separate counsel) or to
object to the settlement, and no written objections or briefs submitted by any Class Member
shall be received or considered by the Referee at the Final Approval Hearing,
unless written notice of the Class Member’s intention to appear at the
Final Approval Hearing, and copies of any written objections or briefs, shall
have been filed with the Referee and served on counsel for the Parties on or
before the Objection Deadline Date. Class Members who fail to file and
serve timely written objections in the manner specified above shall be deemed
to have waived any objections and shall be foreclosed from making any objection
(whether by appeal or otherwise) to the settlement, or any aspect of the
settlement.


 


13.          PAYMENT OF
SETTLEMENT PROCEEDS


 


(a)           As used in this Agreement, “Effective Date” means the
date by which this settlement is finally approved as provided herein and the
Court’s Final Judgment and Order of Dismissal with Prejudice (“Final Judgment”
or “Judgment”) becomes final. For purposes of this Agreement, the Court’s Final
Judgment “becomes final” upon the latter of (i) the date of final
affirmance of an appeal of the Final Judgment; (ii) the expiration of the
time for a petition for a writ of certiorari to review the Final Judgment; (iii) the
date of final dismissal of any appeal from the Final Judgment or the final
dismissal of any appeal or proceeding on certiorari to review the Final
Judgment; or (iv) if no appeal is filed, the expiration date of the time
for the filing or noticing of any appeal from the Court’s Final Judgment.


 


(b)           Defendant shall make payments of Net Payments to
Settlement Class Members by the latest of (i) thirty (30) days of the
Effective Date, or (ii) thirty (30) days after the resolution of the final
challenge as set forth in paragraph 7(b)(2) above, or (iii)  sixty
(60) days after the Final Submission Date.


 


Class Action Settlement Agreement


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(c)           Defendant shall make payments of Net Payments to Late
Claim Settlement Class members by the later of (i) sixty (60) days
after the Final Submission Date, or (ii) thirty (30) days after the
resolution of the final challenge by a Late Claim Settlement Class Member.


 


(d)           The Class Members acknowledge that the claims
process may take longer than described above due to (1) the length of the
claims period, and (2) the reasonable time necessary to calculate the
Individual Settlement Award due each Class Member. Defendant will employ
all due speed to distribute the Individual Settlement Awards to Settlement Class Members
and Late Claim Settlement Class Members at the earliest reasonable date.


 


(e)           Defendant, or the Administrator if Defendant so
desires, shall make payments to Class Counsel for judicially approved
attorney fees and costs, and any incentive awards to current or former
representative plaintiffs by the later of (i) ten (10) days after the
Effective Date as defined above, or (ii) January 2, 2006.


 


14.          COSTS


 


Defendant shall bear its own costs, expenses and attorneys’ fees
incurred in connection with or arising out of the lawsuit.  Plaintiff Class’ attorneys’ fees and costs as
approved by the Court shall be paid from the Potential Maximum Consideration to
be paid by Defendant.


 


15.          RELEASE BY ALL CLASS MEMBERS


 


(a)           As of the Effective Date, the Class Members,
including the Named Plaintiff, release Allstate and each of its subsidiaries,
affiliated and parent corporations, and, as the case may be, each of their
respective past, present or future owners, stockholders, officers, directors,
shareholders, employees, agents, principals, heirs, representatives,
accountants, auditors, consultants, insurers and reinsurers, and its and their
respective successors and predecessors in interest and attorneys, and each of
their company-sponsored employee benefit plans and all of their respective
officers, directors, employees, administrators, fiduciaries, trustees and
agents (the “Released Parties”), from the “Released Claims.” For purposes of
this Agreement, the “Released Claims” are defined as:


 


(1)           All claims, demands, rights, liabilities, and causes
of action of every nature and description whatsoever, known or unknown,
asserted or that might have been asserted, whether in tort, contract, or for
violation of any state or federal constitution, statute, rule or
regulation, including state wage and hour laws, whether for economic damages,
non-economic damages, restitution, penalties or liquidated damages, arising out
of:


 


[a]           any and all facts, transactions, events, policies,
occurrences, acts, disclosures, statements, omissions or failures to act
alleged, or related to acts alleged, in the Class Complaint, including but
not limited to claims: (i) that Allstate did not pay the Class Members
all overtime they were owed for work performed as Class Members in California;
(ii) that Allstate failed to provide Breaks to the Class Members
while they performed work as Class Members in the State of California; and/or (iii) that
Allstate owes wages, waiting-time penalties, penalties, including any penalties
which may be available pursuant to the PAGA,


 


Class Action Settlement Agreement


Page 15













 


interest,
attorneys’ fees or other damages of any kind related to the claims alleged in
the Class Complaint, at any time on or before the last day of the Class Period
(whether based on California state wage and hour law, contract, or otherwise);
and/or


 


[b]           the causes of action asserted in the Class Complaint,
including but not limited to any and all claims for alleged failure to pay overtime,
for alleged failure to provide Breaks, for alleged failure to maintain and
furnish records of hours worked, for alleged unlawful conversion of wages, for
failure to timely pay wages, for alleged minimum wage and pay stub violations
and related violations of Wage Orders, for waiting time penalties, and, as
related to the foregoing, for alleged unlawful, unfair and/or fraudulent
business practices under California Business and Professions Code section 17200,
et seq.


 


(2)           The Released Claims include any unknown claims that
the Class Members do not know or suspect to exist in their favor at the
time of the release, which, if known by them, might have affected their
settlement with, and release of, the Released Parties or might have affected
their decision not to object to this settlement. With respect to the Released
Claims, the Class Members stipulate and agree that, upon the Effective
Date, the Class Members shall be deemed to have, and by operation of the
Final Judgment shall have, expressly waived and relinquished, to the fullest
extent permitted by law, the provisions, rights and benefits of Section 1542
of the California Civil Code, or any other similar provision under federal or
state law, which section provides:


 


A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR.


 


(b)           The Class Members may hereafter discover facts in
addition to or different from those they now know or believe to be true with
respect to the subject matter of the Released Claims, but upon the Effective
Date, shall be deemed to have, and by operation of the Final Judgment shall
have, fully, finally, and forever settled and released any and all of the
Released Claims, whether known or unknown, suspected or unsuspected, contingent
or non-contingent, which now exist, or heretofore have existed, upon any theory
of law or equity now existing or coming into existence in the future,
including, but not limited to, conduct that is negligent, intentional, with or
without malice, or a breach of any duty, law or rule, without regard to the
subsequent discovery or existence of such different or additional facts.


 


(c)           The Class Members, on behalf of themselves and
their respective assigns, agree not to sue or otherwise make a claim against
any of the Released Parties that is in any way related to the Released Claims.


 


Class Action Settlement Agreement


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16.          ADDITIONAL
RELEASE BY ALL SETTLEMENT CLASS MEMBERS


 


(a)           As of the Effective Date, the Settlement Class Members,
including the Named Plaintiff, and any Late Claim Settlement Class Members
in addition to releasing the Released Parties from the Released Claims as
outlined above in paragraph 15, release the Released Parties from the “Released
Federal Claims.” For purposes of this Agreement, the “Released Federal Claims”
are defined as:


 


(1)           All claims, demands, rights, liabilities, and causes
of action of every nature and description whatsoever, known or unknown,
asserted or that might have been asserted, whether in tort, contract, or for
violation of any state or federal constitution, statute, rule or regulation,
including federal wage and hour laws, whether for economic damages,
non-economic damages, restitution, penalties or liquidated damages, arising out
of:


 


[a]           any and all facts, transactions, events, policies,
occurrences, acts, disclosures, statements, omissions or failures to act
alleged, or related to acts alleged, in the Class Complaint, including all
federal claims pursuant to the FLSA, including claims: (a) that Allstate
did not pay the Class Members all overtime they were owed for work performed
as Class Members in the State of California; (b) that Allstate failed
to provide Breaks to the Class Members while they performed work as Class Members
within the State of California; and/or (c) that Allstate owes wages,
waiting-time penalties, penalties, including any penalties which may be
available pursuant to the PAGA, interest, attorneys’ fees or other damages of
any kind related to the claims alleged in the Class Complaint, at any time
on or before the last day of the Class Period (whether based on federal
wage and hour law, contract, or otherwise); and/or


 


[b]           the causes of action asserted in the Class Complaint,
including any and all federal claims arising from the Fair Labor Standards Act
for alleged failure to pay overtime, for alleged failure to provide Breaks, for
alleged failure to maintain and furnish records of hours worked, and for
alleged unlawful conversion of wages due to Class Members for hours worked
as Class Members within the State of California.


 


(2)           The Released Federal Claims include any unknown claims
that the Settlement Class Members and any Late Claim Settlement Class Members
do not know or suspect to exist in their favor at the time of the release,
which, if known by them, might have affected their settlement with, and release
of, the Released Parties or might have affected their decision not to object to
this settlement. With respect to the Released Federal Claims, the Settlement Class Members
and any Late Claim Settlement Class Members stipulate and agree that, upon
the Effective Date, the Settlement Class Members and any Late Claim
Settlement Class Members shall be deemed to have, and by operation of the
Final Judgment shall have, expressly waived and relinquished, to the fullest
extent permitted by law, the provisions, rights and benefits of Section 1542
of the California Civil Code, or any other similar provision under federal or
state law, which section provides:


 


Class Action Settlement Agreement


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A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR.


 


(b)           The Settlement Class Members and any Late Claim
Settlement Class Members may hereafter discover facts in addition to or
different from those they now know or believe to be true with respect to the
subject matter of the Released Federal Claims, but upon the Effective Date, shall
be deemed to have, and by operation of the Final Judgment shall have fully,
finally, and forever settled and released any and all of the Released Federal
Claims, whether known or unknown, suspected or unsuspected, contingent or
non-contingent, which now exist, or heretofore have existed, upon any theory of
law or equity now existing or coming into existence in the future, including,
but not limited to, conduct that is negligent, intentional, with or without
malice, or a breach of any duty, law or rule, without regard to the subsequent
discovery or existence of such different or additional facts.


 


(c)           The Settlement Class Members and any Late Claim
Settlement Class Members, on behalf of themselves and their respective
assigns, agree not to sue or otherwise make a claim against any of the Released
Parties that is in any way related to the Released Federal Claims. The Released
Federal Claims are limited to Settlement Class Members and any Late Claim
Settlement Class Members claims arising from working in or being based
from (during CAT duty) California claims offices.


 


17.          WAIVER OF FUTURE
PENSION, RETIREMENT AND/OR 401(K) RIGHTS BY ALL SETTLEMENT CLASS MEMBERS


 


As of the Effective Date, the Settlement Class Members and any
Late Claim Settlement Class Members, including the Named Plaintiff, in
addition to releasing the Released Parties from the Released Claims as outlined
above in paragraphs 15 and 16, expressly, knowingly and voluntarily


 


(a)           acknowledge that none of the
amounts paid under this Agreement constitute either “annual
compensation” or “eligible annual compensation” under the Allstate Retirement
Plan or “eligible compensation” under the Savings and Profit Sharing Fund of
Allstate Employees; and


 


(b)           waive any and all claims for additional contributions
to and/or benefits under any pension, retirement and/or 401(k) plan maintained
or sponsored by Allstate based on any amount paid under this Agreement.


 


Nothing in this provision or this Agreement
shall in any other way affect the rights of any Class Member to any
benefits under any such plan to which such Class Member may otherwise be
entitled in accordance with the terms of any such plan.


 


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18.          WAIVER OF RIGHTS


 


(a)           Defendant waives any right it may have to further
appeal or contest, in any manner, the order certifying this matter as a class
action or the order granting plaintiffs’ motion for summary adjudication.


 


(b)           Class Members waive any right they may have to overtime
pay or any other matter alleged in or related to allegations in the Class Complaint
except as provided for in this Agreement.


 


(c)           The parties hereto, including the Plaintiff Class,
stipulate and agree that the consideration paid to the Class Members
pursuant to this Agreement compensates the Plaintiff Class for all
overtime compensation due to them, all penalties, all liability for Breaks and
any compensation to which they may be entitled pursuant to the California Labor
Code, or the applicable Wage Order, and any related penalties and as such, the Class Members
are not “aggrieved employees” for purposes of the PAGA, and, therefore,
Defendant is not liable for any penalties pursuant to the PAGA.


 


(d)           The parties hereto, including the Plaintiff Class,
further stipulate and agree that even if any Class Member is considered or
determined to be an “aggrieved employee” for purposes of the PAGA, said Class Member
waives any potential right to any penalty prescribed by the PAGA, the
California Labor Code or the applicable Wage Order.


 


(e)           The Parties hereto, including the Plaintiff Class,
further stipulate and agree that Defendant has taken reasonable steps to insure
that Breaks are taken as required by law and that Defendant is in compliance
with the California Labor Code and applicable Wage Order and that Class Counsel
has conducted a reasonable investigation and determined that Defendant is
currently in compliance with the California Labor Code and applicable Wage
Order and Breaks are being provided as required by law.


 


(f)            The Referee and the Court have reviewed this Agreement
and concluded that the Plaintiff Class has been adequately compensated for
all violations alleged in the Class Complaint and to which they otherwise
may be entitled and that any additional penalties pursuant to the PAGA would be
an unjust and oppressive award. Accordingly, to the extent any PAGA penalties
could potentially be awarded to the Plaintiff Class, the Court hereby
determines that no PAGA penalties should be awarded. The parties to this
Agreement concur with this determination.


 


19.          NO ADMISSION BY
THE PARTIES


 


Allstate and the Released Parties deny any and all claims alleged in
the Lawsuit and in the Class Complaint and deny all wrongdoing whatsoever.
Allstate continues to assert that it properly classified its adjusters as
administrative employees exempt from California and federal overtime
regulations. This Agreement is neither a concession nor an admission, and shall
not be used against Allstate or any of the Released Parties as an admission or
indication with respect to any claim of any fault, concession or omission by
Allstate or any of the Released Parties. Whether or not the settlement is
finally approved, neither the settlement, nor any document,


 


Class Action Settlement Agreement


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statement, proceeding or conduct related to
this Agreement, nor any reports or accounts thereof, shall in any event be:


 


(a)           construed as, offered or admitted in evidence as,
received as, or deemed to be evidence for any purpose adverse to the Released
Parties, including, but not limited to, evidence of a presumption, concession,
indication or admission by any of the Released Parties of any liability, fault,
wrongdoing, omission, concession or damage; or


 


(b)           disclosed, referred to or offered or received in
evidence against any of the Released Parties, in any further proceeding in the
Lawsuit, or any other civil, criminal or administrative action or proceeding,
except for purposes of settling the Lawsuit pursuant to this Agreement.


 


20.          NULLIFICATION OF
AGREEMENT


 


In the event: (i) the Court does not enter the order specified
herein and attached hereto as Exhibit “D”; (ii) the Court does not
finally approve the settlement as provided herein; (iii) the Court does
not enter a Final Judgment as provided herein and attached hereto as Exhibit “E”
which becomes final as a result of the occurrence of the Effective Date; or (iv) the
settlement does not become final for any other reason, this Agreement shall be
null and void and any order or judgment entered by the Court in furtherance of
this settlement shall be treated as void ab initio. In
such a case, the parties and any funds to be awarded under this Settlement
shall be returned to their respective statuses as of the date and time
immediately prior to the execution of this Agreement, and the parties shall
proceed in all respects as if this Agreement had not been executed.


 


21.          PRIVACY OF
DOCUMENTS AND INFORMATION


 


The Plaintiff Class and Class Counsel agree that none of the
documents and information provided to them by Allstate shall be used for any
purpose other than prosecution of the Lawsuit. Within ten (10) days of the
Effective Date of this Agreement if so requested by Defendant, the Plaintiff Class and
Class Counsel shall return all copies of all documents marked as “confidential”
which were produced to them during this litigation.


 


22.          REPRESENTATIONS
AND WARRANTIES


 


Each party represents and warrants that he, she or it has not
heretofore assigned or transferred, or purported to assign or transfer, any of
the claims released pursuant to this Agreement to any other person not a party
hereto and that he, she or it is fully entitled to compromise and settle same.


 


23.          CALIFORNIA LAW


 


All questions with respect to the construction of this Agreement and
the rights and liabilities of the parties hereto shall be governed by the laws
of the State of California applicable to agreements to be wholly performed
within the State of California.


 


Class Action Settlement Agreement


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24.          OWN COUNSEL


 


Each party acknowledges that he, she or it has been represented by
counsel of his, her or its own choice throughout all of the negotiations which
preceded the execution of this Agreement and in connection with the preparation
and execution of this Agreement.


 


25.          FURTHER ACTS AND
DOCUMENTS


 


The parties agree to do such acts and execute all such documents
necessary to effectuate the intent of this Agreement.


 


26.          COUNTERPARTS


 


This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.


 


27.          HEADINGS


 


The headings contained in this Agreement are for reference only and are
not to be construed in any way as a part of the Agreement.


 


28.          ENTIRE AGREEMENT


 


This Agreement represents the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior contemporaneous
oral and written agreements and discussions. Each of the parties covenants that
he, she or it has not entered in this Agreement as a result of any
representation, agreement, inducement, or coercion, except to the extent
specifically provided herein. Each party further covenants that the
consideration recited herein is the only consideration for entering into this
Agreement and that no promises or representations of another or further
consideration have been made by any person. This Agreement may be amended only by
an agreement in writing duly executed by all parties hereto.


 


29.          BINDING EFFECT


 


This Agreement shall be binding upon and inure to the benefit of the
parties hereto and to their respective heirs, assigns and
successors-in-interest.


 


30.          DRAFTING


 


Each party has cooperated in the drafting and preparation of this
Agreement. Hence, in any construction to be made of this Agreement, the same
shall not be construed against any party as drafter of this Agreement.


 


31.          SEVERABILITY


 


In the event any covenant or other provision herein is held to be
invalid, void or illegal, the same shall be deemed severed from the remainder
of this Agreement and shall in no way affect, impair or invalidate any other
covenant, condition or other provision herein. If any


 


Class Action Settlement Agreement


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covenant, condition or other provision herein
is held to be invalid due to its scope or breadth, such covenant, condition or
other provision shall be deemed valid to the extent of the scope or breadth
permitted by law.


 


32.          INCORPORATION OF
EXHIBITS


 


All exhibits attached hereto are hereby incorporated by reference as
though set forth fully herein and are a material part of this Agreement.  Any notice, order, judgment or other exhibit
that requires approval of the Referee and/or the Court must be approved without
material alteration from its current form in order for this Agreement to become
effective.


 


33.          AUTHORITY


 


Each party warrants and represents that each of the persons/or entities
executing this Agreement is duly empowered and authorized to do so.


 


34.          NAMED PLAINTIFF’S
WAIVER OF RIGHT TO OBJECT


 


The Named Plaintiff agrees to sign this Agreement and by signing this
Agreement is bound by the terms herein stated and further agrees not to request
to be excluded from the Plaintiff Class and agrees not to object to any of
the terms of this Agreement. Non-compliance by the Named Plaintiff with this
paragraph shall be void and of no force or effect. Any such request for
exclusion or objection shall therefore be void and of no force or effect.


 


35.          ADMINISTRATION
OF SETTLEMENT AND COMPLIANCE


 


The Referee and/or the Court shall further have continuing jurisdiction
to resolve any dispute which may arise with regard to the terms and conditions
of this Agreement, subject to approval by the Court and/or the Referee as set
forth herein.


 


36.          FINAL ORDER AND JUDGMENT OF SETTLEMENT


 


Upon final approval of the settlement, a final order and judgment shall
be entered by the Court in the form of an order attached hereto as Exhibit “D”
which shall, inter alia:


 


(a)           Grant final approval to the settlement as fair,
reasonable, adequate, in good faith and in the best interests of the Plaintiff
Class, as a whole, and order the parties to carry out the provisions of this
Agreement.


 


(b)           Dismiss with prejudice all actions, complaints and
claims and any lawsuit as against Allstate and/or the Released Parties arising
out of or related to any of the actions or events complained of in the Class Complaint
herein.


 


(c)           Adjudge that Class Members are conclusively
deemed to have released Allstate and the Released Parties of and from any and
all rights, claims, demands, liabilities, causes of action, liens and judgments
arising out of or in any way related to the matters set forth, or that could
have been set forth, in the Class Complaint.


 


Class Action Settlement Agreement


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(d)           Bar and permanently enjoin each Class Member from
prosecuting against the Released Parties any and all of the settled claims
which the Class Members or any of them had, have or may have in the
future, arising out of, based upon, or otherwise related to any of the settled
claims, or any of the allegations contained in the operative complaint or in
the Class Complaint.


 


(e)           Bar and permanently enjoin each person in the
Plaintiff Class who opted not to participate in the settlement (or who
having previously opted out, chose not to submit a Claim Form) from
participating in any future class action regarding the claims raised in the Class Complaint.


 


(f)            Reserve continuing jurisdiction as provided herein
above.


 


37.          NOTICE


 


After the Court enters its order granting final approval of this
Agreement, all notices, requests, demands and other communications required or
permitted to be given pursuant to this Agreement shall be in writing and shall
be delivered personally, telecopied or mailed postage pre-paid by first class
mail to the following persons at their addresses set forth as follows:


 


Class Counsel:


 


	
  

  Louis Marlin, Esq.

  Marlin & Saltzman

  2400 E. Katella Ave.

  Suite 1030

  Anaheim, CA 92806



  	
  

  R. Rex Parris, Esq.

  The R. Rex Parris Law Firm

  963 West Avenue J

  Lancaster, CA 93534

  
	
  

  Stanley D. Saltzman, Esq.

  Marlin & Saltzman

  28229 Canwood St.

  Suite 208

  Agoura Hills, CA 91301



  	
  

  Arnold Schwartz, Esq.

  Mazursky, Schwartz, Daniels &
  Bradley

  10990 Wilshire Blvd.

  Suite 1200

  Los Angeles, CA 90024-3927

  



 


Defendant’s Counsel


 


	
  

  Joel E. Krischer

  Latham & Watkins LLP

  Suite 4000

  633 West Fifth Street

  Los Angeles, CA 90071-2007



  	
  

  Andrew M. Paley, Esq.

  Seyfarth Shaw LLP

  2029 Century Park East

  Suite 3300

  Los Angeles, CA 90067

  



 


Class Action Settlement Agreement


Page 23













 


WHEREFORE, the Named Plaintiff on his own behalf and on behalf of the
Plaintiff Class, and Defendant, by their duly authorized agents or counsel,
have executed this Agreement as of the dates set forth below.


 


	
  Class Representative

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: 8/29/05

  	
   

  	
  /s/ William Sekly

  	
   

  
	
   

  	
  William Sekly

  	
   

  
	
   

  	
   

  	
   

  
	
  Defendant:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: 8/30/05

  	
  Allstate Insurance Company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Mary McGinn

  	
   

  
	
   

  	
   

  	
   

  	
  Vice President and Deputy General

  
	
   

  	
   

  	
  Counsel

  
							



 


 


	
  Approval As To Form And Content By
  Counsel

  	
   

  
	
   

  	
   

  
	
  On Behalf of the Plaintiff Class:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: 8/29/05

  	
  MARLIN & SALTZMAN

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
  /s/ Louis M. Marlin

  
	
   

  	
   

  	
   

  	
  Louis M. Marlin

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dated: 8/29/05

  	
  THE R. REX PARRIS LAW FIRM

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
  /s/ R. Rex Parris

  
	
   

  	
   

  	
   

  	
  R. Rex Parris

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dated: 8/29/05

  	
  MAZURSKY, SCHWARTZ, DANIELS &

  BRADLEY

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
  /s/ Arnold Schwartz

  
	
   

  	
   

  	
   

  	
  Arnold Schwartz

  



 


Class Action Settlement Agreement


Page 24













 


	
  On Behalf of Defendant:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dated: 8/29/05

  	
  LATHAM & WATKINS LLP

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
  /s/ Joel E. Krischer

  
	
   

  	
   

  	
   

  	
  Joel E. Krischer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dated: 8/30/05

  	
  SEYFARTH SHAW LLP

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
  /s/ Andrew M. Paley

  
	
   

  	
   

  	
   

  	
  Andrew M. Paley

  



 


Class Action Settlement Agreement


Page 25













 


EXHIBIT A


 


SUPERIOR
COURT OF CALIFORNIA


COUNTY OF LOS ANGELES


 


	
  WILLIAM SEKLY, et al.,

  	
  )

  	
  Case Number: BC 240813

  	
   

  
	
  Plaintiffs,

  	
  )

  	
   

  	
   

  
	
  v.

  	
  )

  	
   

  	
   

  
	
   

  	
  )

  	
   

  	
   

  
	
  ALLSTATE INSURANCE COMPANY,

  	
  )

  	
  NOTICE OF CLASS

  	
   

  
	
  Defendant.

  	
  )

  	
  ACTION SETTLEMENT

  	
   

  
	
   

  	
  )

  	
   

  	
   

  
	
   

  	
  )

  	
   

  	
   

  



 


TO:         All
persons who, between November 27, 1996 and December 31, 2004, have
been employed in California as claims adjusters by the defendant Allstate
Insurance Company.  As used in the class
definition, the term “claims adjuster” refers to any individual whose assigned
duties as an employee of the defendant included or currently include, but were
not limited to, the adjustment and/or investigation and/or analysis and/or
evaluation of the monetary worth of any claim made to Allstate for any bodily
injury, property damage, and/or monetary damage of every nature and type and
who have been or currently are paid as exempt employees as the same are defined
pursuant to statute and/or California or federal regulatory determination.


 


	
  On 

  	
   

  	
  , the Court
  granted preliminary approval of the proposed settlement in this Action. If
  the settlement is granted final 

  
	
  approval, the
  Action will be dismissed and Allstate will be released of all claims related
  to this case. This Notice is to advise you of the proposed settlement, your
  rights to object to the terms of the proposed settlement, and how to obtain
  more information about the settlement.

  



 


 


PLEASE READ THIS ENTIRE NOTICE CAREFULLY.


YOUR RIGHTS MAY BE AFFECTED BY THE PROPOSED
SETTLEMENT DESCRIBED BELOW.


 


I.              SUMMARY OF THE LITIGATION


 


On November 27,
2000, a lawsuit was filed against Allstate Insurance Company (and related
entities) on behalf of former and current claims adjusters of those companies
who have worked in California in connection with the adjusting of property
damage and/or bodily injury claims.  The
case seeks recovery of overtime pay and penalties which plaintiffs contend are
owed to all present and former claims adjusters who adjusted claims in
California from November 27, 1996 to December 31, 2004.  The matter has been litigated before the Hon.
Anthony J. Mohr, Judge of the Superior Court of the State of California for the
County of Los Angeles (hereafter, the “Court”).


 


On August 23,
2002, the Court certified this matter as a class action over the objection of
Allstate.  Class notice was sent to
all potential class members at their last known address (as provided by
Allstate) via first class U.S. Mail. 
Thereafter, on April 21, 2004, the Court entered its order granting
the plaintiff class’ motion for summary adjudication of liability and
determining that the members of the plaintiff class were and are non-exempt
employees entitled to overtime compensation. 
That decision of the Court could have been the subject of an appeal if
the matter was litigated through trial. 
On January 19, 2005, again over the objection of Allstate, the
Court further certified this matter as a class action for the determination of
damages.


 


During
the course of this litigation, attorneys for the plaintiff class and attorneys
for the defendant have engaged in mediation with an experienced mediator who is
a former justice of the California Supreme Court.  In addition, counsel for the parties have
engaged in numerous discussions in an attempt to resolve this matter.  The parties have reached an agreement to settle
this matter, subject to the approval of the Court.


 













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


As
part of the settlement process, the Court has appointed the Hon. Edward Panelli
(Ret.), a retired justice of the California Supreme Court, to act as the
Referee in this matter.  Justice Panelli
will conduct the Fairness Hearing described later in this Notice and shall
report his findings to the Court. 
Justice Panelli will also resolve any disputes involving the settlement
process, with certain of his recommendations being presented to the Court for
approval and other determinations being final, binding and non-appealable.


 


II.            CLASS DEFINITION


 


A.            Settlement
Class Defined


 


The
certified settling class (“Class”) is defined as follows (members of the Class are
sometimes referred to in this Notice as “Class Members”):


 


The Class is
comprised of all persons who, between November 27, 1996 and December 31,
2004 were employed in California as claims adjusters by Allstate.  As used in the Class definition, the
term “claims adjuster” refers to any individual whose assigned duties as an
employee of Allstate included, but were not limited to, the adjustment and/or
investigation and/or analysis and/or evaluation of the monetary worth of any
claim made to Allstate for any bodily injury, property damage, and/or monetary
damage of every nature and type and who have been or currently are paid as
exempt employees as the same are defined pursuant to statute and/or California
or federal regulatory determination.


 


As of
the date of the settlement, Allstate has represented that the job titles which
comprise the Class Members who work at Allstate claims offices in
California are as follows:


 


	
  Claim
  Representative

  	
   

  	
  Claim Adjuster

  	
   

  	
  Claim Service
  Adjuster

  
	
  Senior Claim Representative

  	
   

  	
  Senior Claim
  Adjuster

  	
   

  	
  Senior Claim
  Service Adjuster

  
	
  Staff Claim
  Representative

  	
   

  	
  Staff Claim
  Adjuster

  	
   

  	
  Staff Claim
  Service Adjuster

  
	
  Senior Staff
  Claim Representative

  	
   

  	
  Staff Claim
  Analyst

  	
   

  	
  SIU Adjuster

  
	
  Subrogation
  Adjuster

  	
   

  	
  Appraisers

  	
   

  	
  Claims
  Specialist

  
	
  Claims
  Consultant

  	
   

  	
  Evaluation
  Consultant

  	
   

  	
  Damage Evaluator

  
	
  Quality
  Evaluator

  	
   

  	
  Extra
  Contractual Liability Specialist

  	
   

  	
   

  



 


Any
change, modification, addition or deletion of any job titles by Allstate shall
not result in a change in the persons defined as Class Members, whose
entitlement to the same is based upon the duties they perform as set forth in
this Notice.


 


Persons
who performed such functions while classified, employed and compensated by
Allstate as supervisors, managers or officers of said Allstate are not included
in the Class during any time said persons were so employed.  Persons performing work in the following job
titles (as the work duties and responsibilities of said titles existed as of
the date of certification) are not included in the defined Class during
any period of time said position was or is held during the class period:
Frontline Process Experts, Frontline Performance Leaders and supervisory
personnel.


 


B.            Information
For Persons Who Previously Excluded Themselves From The Class


 


Persons
who elected to opt out of the Class at the time notice of class
certification for liability or notice of class certification for damages were
served may rejoin the Class by filing a timely and complete Claim Form as
set forth in section IV hereafter.


 


If you
continue to elect not to participate in the recovery obtained through this
settlement, you will be entitled to prosecute an individual lawsuit or an
individual claim with the California Labor Commissioner, in accordance with
California law, but you may not pursue any such claim as part of a class
action.  If you fail
to submit a timely Claim Form, you will remain excluded from the Class.


 


2













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


C.            Information
For Special Investigative Unit Adjusters, Subrogation Adjusters, Evaluation
Consultants, Damage Evaluators, Quality Evaluators and Extra Contractual
Liability Specialists


 


Previously,
Special Investigative Unit Adjusters, Subrogation Adjusters, Evaluation
Consultants, Damage Evaluators, Quality Evaluators and Extra Contractual
Liability Specialists were not included in the Class.  As part of the settlement between the
parties, these job classifications will now be included in the Class.  If you wish, the Court will exclude you from
the Class if you so request.  If you
wish to be excluded from the Class, you must fill out and send the enclosed
Exclusion Request Form to the Claims Administrator 


	
  by 

  	
   

  	
   [30 from mailing]:

  



 


 


Gilardi & Company


 


















 


If you
timely request exclusion from the Class, you will:  (1) not participate in the recovery
obtained through this settlement, and (2) be entitled to prosecute an
individual lawsuit, or an individual claim with the Labor Commissioner, in
accordance with California law, but you may not pursue any such claim as part
of a class action.


 


If you
do not choose to exclude yourself from the Class, you may file a Claim Form and
participate with all other Class Members. 
You may, if you so desire, enter an appearance through counsel of your
choice.


 


III.           CLASS REPRESENTATIVES AND CLASS COUNSEL


 


The
Court appointed plaintiffs Dani Bednar and William Sekly to represent the
Class.  Recently, Ms. Bednar
withdrew as a representative.  The Court
appointed the following attorneys to represent the Class as “Class Counsel:”


 


	
  Marlin &
  Saltzman

  Louis M. Marlin

  2400 E. Katella
  Ave., Suite 1030

  Anaheim, CA
  92806

  	
  R. Rex Parris
  Law Firm

  R. Rex Parris

  Robert Parris

  963 W. Avenue J

  Lancaster, CA
  93534

  
	
   

  	
   

  
	
  Marlin &
  Saltzman

  Stanley D.
  Saltzman

  29229 Canwood
  St., Suite 208

  Agoura Hills, CA
  91301

  	
  Mazursky,
  Schwartz, Daniels & Bradley

  Arnold Schwartz

  Marcus Bradley

  10990 Wilshire
  Blvd., Suite 1200

  Los Angeles, CA
  90024

  



 


IV.           SUMMARY OF SETTLEMENT TERMS AND CLAIMS PROCESS


 


The following
is a summary of the proposed settlement contained in the Settlement Agreement (“Settlement
Agreement”) that is on file with the Clerk of the Central Civil West division
of the Court.  The complete Agreement may
be inspected during normal business hours at the offices of the Clerk or online
at www.overtimelawsuit.com under the heading of “Allstate Insurance Company.”


 


A.            Monetary
Award.


 


The
proposed settlement obligates the defendant to pay a potential maximum
settlement amount (called the “Potential Maximum Consideration” in the
Agreement) of One Hundred Twenty Million Dollars ($120,000,000).  This payment is “all inclusive,” including,
but not limited to, unpaid overtime pay, pay for meal and rest break
violations, any and all associated penalties, interest, employer tax
contributions, costs, attorneys’ fees, class administration costs, referee
costs, incentive payments to the named plaintiffs, etc.  These settlement proceeds will be paid to Class Members
as described in Section VI later in this Notice.


 


3













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


B.            The
Claims Process.


 


	
  Enclosed with this
  Notice you will find a Claim Form. THIS CLAIM FORM MUST BE COMPLETED,
  SIGNED UNDER PENALTY OF PERJURY, AND RETURNED TO THE CLAIMS ADMINISTRATOR
  WITHIN 75 DAYS OF THE MAILING OF THE SAME. THEREFORE, FOR YOUR CLAIM TO BE
  CONSIDERED TIMELY, IT MUST BE POSTMARKED NO LATER 

  
	
  THAN 

  	
   

  	
  . Claims postmarked after that date will be
  considered as late claims and may be subject to rejection. Please 

  
	
  follow the directions on the Claim
  Form carefully. If you require assistance, you may contact
  Class counsel as identified at the end of this notice. As used herein
  and in the Settlement Agreement, a Class Member who submits a timely
  Claim Form is called a “Settlement Class Member,” and a
  Class Member who submits a late claim that is not rejected by the
  Referee is called a “Late Claim Settlement Class Member.”

  



 


The
Claim Forms shall be maintained by an independent claims administrator (“Administrator”)
chosen by the Class Counsel until the claims period has been
completed.  At that time, the forms shall
be provided to Allstate for use in distributing the settlement proceeds.  However, at no time shall any such form (1) be
used in any proceeding, action, etc. in regard to any individual employee, (2) be
placed (or a copy placed) in any individual employee’s personnel file, or (3) be
provided to any manager or supervisor at the claims office level or below.  The purpose of this procedure is to ensure
that no current or former employee could, in any way, be negatively impacted by
filing a claim.


 


C.            Notice
and Administration.


 


The
settlement process will be administered by the Administrator.  The costs of administration shall be subtracted
from the potential maximum settlement amount to be paid by Allstate, except
that if Allstate elects to have the claims administrator disburse settlement
proceeds to Class Members, the cost of those activities will be paid by
Allstate.


 


D.            Release
and Waiver.


 


The
scope of the release and waiver that Class Members are providing Allstate
is important, and the full text of that release is attached as an Appendix to
this Notice.  In summary, if the
settlement is approved by the Court, the scope of the release and waiver upon
the Effective Date of the settlement is as follows:


 


	
  1.

  	
  All Class Members, including those who do not
  submit a Claim Form, shall be deemed to have agreed that, 

  
	
  except for the obligations imposed by this
  settlement, Allstate shall be forever released and discharged from all
  “Released Claims” (including, without limitation, that Allstate failed to pay
  Class Members overtime or to provide them with rest breaks and meal
  periods, or otherwise violated California law with respect to the payment of
  wages or the maintenance of records) and that the Class representatives
  and all Class Members shall be barred and enjoined from suing the
  Released Parties for any liability in any way related to or arising out of
  any Released Claim. The Released Claims also include any and all claims, of
  every kind and nature, known or unknown, that were or could have been
  asserted against Allstate by the Class representatives or
  Class Members in any type of proceeding, for unpaid overtime
  compensation and/or statutory penalties, or any other relief sought in the
  Complaint,or in the 

  
	
  Amended Complaint filed on 

  	
   

  	
   in this
  matter for the period November 27, 1996 through the effective 

  
	
  date of the settlement.

  
				



 


	
  2.

  	
  Any Class Member who submits a timely or late
  Claim Form (late claims are described in paragraph 6 of 

  
	
  section VI, below) will also release the
  Released Parties from the “Released Federal Claims.”  For purposes of the settlement, “Released
  Federal Claims” includes all “Released Claims” plus any claims under federal
  law, including under the Fair Labor Standards Act, for failure to pay
  overtime, to maintain records or for any other claim regarding the payment of
  wages under federal law.  Released
  Federal Claims also means any and all claims, of every kind and nature, known
  or unknown, that were or could have been asserted against Allstate by the Class representatives
  or Class Members in any type of proceeding, for unpaid overtime compensation
  and/or statutory penalties, or any other 

  
	
  relief sought in the Complaint, or in the Amended
  Complaint filed on 

  	
   

  	
   in this
  matter for the 

  
	
  period November 27, 1996 through the effective
  date of the settlement.

  
				



 


4













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


3.             Any
Class Member who submits a timely or late Claim Form will also (a) acknowledge
that none of the amounts paid under this settlement will constitute
compensation under the Allstate Retirement Plan or the Savings and Profit
Sharing Fund of Allstate Employees, and will waive any and all claims for
additional contributions to and/or benefits under any pension, retirement
and/or 401(k) plan maintained or sponsored by Allstate based on any amount paid
under the settlement.


 


This summary is for your
convenience only.  The full scope of the
release and waiver will be governed by the terms of the Settlement Agreement.


 


E.             Attorneys’ Fees.


 


Class Counsel
has litigated this matter since September 2000.  The three law firms representing the Class have
devoted substantial time, effort and expenses in prosecuting this matter,
including taking approximately 400 depositions, reviewing over 75,000 pages of
documents produced by Allstate, obtaining class certification, obtaining
summary adjudication, etc.  It is
customary for courts to award attorneys’ fees based upon a percentage of the
potential maximum settlement amount for the benefit of a class in amounts
ranging from 25% to 40% of that amount. 
In this case, each of the three firms representing the Class will
request an award equal to 11 1/9% of the potential maximum settlement amount,
for a total attorneys’ fee award of 33 l/3%. 
Class Counsel will also seek reimbursement of the costs and
expenses they have incurred on behalf of the Class, estimated to be
approximately $800,000.


 


V.            INCENTIVE AWARD


 


The Class representative
(Ms. Bednar and Mr. Sekly) will seek an incentive award from the
potential maximum settlement amount not to exceed 3⁄4 of the average individual
settlement award for a Class Member who was in the Class for the full
Class Period for the time and effort they have expended in bringing this
action.


 


VI.           CALCULATION OF PAYMENTS TO CLASS MEMBERS


 


The
settlement administrative costs, incentive awards to each of the Class representatives,
Referee costs, attorneys’ fees and costs and other associated expenses and a
reserve for “Late Claims” (discussed below) shall be subtracted from the
potential maximum settlement amount.  The
funds remaining after payment of these expenses are designated as the Potential
Gross Individual Settlement Proceeds, which is the amount available for
distribution among Class Members who submit timely claims.  The calculation of each Class Member’s
share of the funds available for distribution is as follows:


 


1.             The
Potential Gross Individual Settlement Proceeds will first be allocated among
the calendar years in the Class Period (from November 27, 1996 through December 31,
2004).  Each year’s allocation shall be a
percentage equal to (i) the total compensation to all Class Members
during that year plus imputed interest calculated at 7% per annum simple
interest through December 31, 2004, divided by (ii) the sum of all
such compensation and all such imputed interest for all calendar years in the Class Period.


 


2.             A
Class Member’s total compensation for a calendar year shall be the amount
reported in Box 1 of the member’s

W-2 form for that year (prorated to the nearest full month for any year in
which a Class Member was not actively employed in the Class for the
entire year).  Every Class Member who
was employed as a catastrophe (“CAT”) adjuster at any time during each year
shall have his or her annual gross compensation for that year adjusted as set
forth in paragraph 3.


 


3.             Each
Class Member shall be entitled to an “Individual Percentage” of each
calendar year’s allocation on a year-by-year basis based on that Class Member’s
compensation as a Class Member during each year.  That percentage shall equal (i) the
gross compensation earned by that Class Member for the months in each
calendar year that such Class Member worked as a Class Member divided
by (ii) the total gross compensation paid to all Class Members for
all of the months worked by Class Members during such year of the Class Period.   Every Class Member who was employed as
a CAT adjuster at any time during each year shall have his or her annual gross
compensation for that year increased by a factor equal to 60% times the ratio
of the number of days that Class Member worked as a CAT adjuster that year
over 365.  It is


 


5













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


understood that
Individual Percentages for Class Members who worked as CAT adjusters in
any year will be increased, and the Individual Percentages for Class Members
who did not work as CAT adjusters for that year shall be correspondingly
reduced.  (For purposes of 1996 only, any
person who was a Class Member for at least two weeks between November 27
and December 31, 1996 shall be credited with one month, and CAT adjuster
duty shall not be considered.)  The
Individual Percentage so determined for each Class Member shall then be
multiplied by the Potential Gross Individual Settlement Proceeds allocated to
that calendar year to determine the allocations to Class Members for that
calendar year.  Of the total amount so
allocated, the percentage allocable to imputed interest shall be interest and
the remainder shall be, in the appropriate percentages, wages (subject to
withholding) and employer-paid payroll taxes on such wages.


 


Example:  If a Class Member worked during a year
in the Class Period and earned a total of $1, and the total gross
compensation paid out to Class Members during that year, after adjustments
for CAT duty, was $100, that Class Member would be entitled to 1% (1/100) of
the Potential Gross Individual Settlement Proceeds allocated to that year.


 


4.             The
amount that each Class Member is entitled to receive – the “Individual
Settlement Award” – equals the sum of his or her Individual Percentages of each
year’s allocation.  The proportion of
each year’s allocation that represents imputed interest shall be interest
income to the Class Member.  The
portion of each Class Member’s Individual Settlement Award that is not
interest shall be divided by the appropriate factor to determine the Class Member’s
gross wages (subject to withholding) and the balance shall be the employer-paid
payroll taxes with respect to such gross wages.


 


5.             The
total of Individual Settlement Awards claimed by Settlement Class Members
shall be the “Claimed Settlement Amount.” 
If each and every Class Member submits a timely and properly
completed Claim Form, then the Claimed Settlement Amount shall equal the
Potential Gross Individual Settlement Proceeds and all Individual Settlement
Awards shall be distributed to all Settlement Class Members.  If all Class Members do not submit
timely and properly completed Claim Forms, Allstate may pay less than the
Potential Gross Individual Settlement Proceeds, as follows:


 


The
value of the Individual Settlement Award for a Class Member who does not
submit a timely Claim Form shall be determined by the Administrator and
allocated to the “Unclaimed Amount.”  The
first $6 million plus one-half of any amount over $6 million in the Unclaimed
Amount shall be distributed to Class Members who submitted timely Claim
Forms on a pro rata basis where the numerator equals each Settlement Class Member’s
Individual Settlement Award and the denominator equals the sum of the
Individual Settlement Award for all Settlement Class Members.   Each allocation shall be interest, wages
(subject to withholding) and employer-paid payroll taxes on such wages in the
same proportions as each Settlement Class Member’s Individual Settlement
Award.  The balance of the Unclaimed
Amount (one-half of any amount over $6 million) shall be retained by Allstate.


 


6.             TO PARTICIPATE IN THE SETTLEMENT TO THE FULL EXTENT POSSIBLE, YOU MUST
SUBMIT A VALID AND TIMELY CLAIM FORM.  For any Claim Form submitted after
[date] – the “Submission Date” –  the
Referee shall determine whether the Claim Form should be deemed as timely
(due to an inaccurate address for the Class Member), considered an approved “Late
Claim,” or rejected.  For any Claim Form submitted
after January 31, 2006, the Referee shall determine whether the Claim Form should
be approved as a Late Claim (regardless of the reason the Claim Form was
submitted late) or rejected.  Any Claim Form submitted
after February 28, 2006, regardless of the reason, shall be
rejected.  The Referee’s decisions in
this regard shall be final, binding and non-appealable.


 


7.             A
total of $500,000 (the “Late Claim Reserve”) shall be held aside from the
Potential Maximum Consideration to cover the payment of Late Claims.  The Individual Settlement Award for a Late
Claim shall be computed as if such claim had not been late, except that (i) all
such claims shall be paid separately from the Late Claim Reserve; (ii) the
total of all such claims shall not exceed such reserve; and (iii) Class Members
submitting Late Claims shall not participate in the distribution of the
Unclaimed Amount.  If the total of the
Late Claims exceeds the Late Claim Reserve, all such claims shall be reduced
proportionately


 


6













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


so that the total paid
does not exceed $500,000.  If the total
of Late Claims is less than $500,000, the unused portion of the Late Claim
Reserve shall be retained by Allstate.


 


8.             Class Members
shall have the right to challenge Allstate’s position as to the number of
months a Class Member was employed during the Class Period and/or the
number of days of CAT duty worked.  The Class Member’s
basis for this challenge, along with copies of any supporting documents, must
be provided to the Claims Administrator with the Class Member’s Claim
Form.  Allstate will have the opportunity
to respond to the Class Member’s position in writing, and the Class Member
will be permitted to reply to the same. 
Thereafter, the Referee will decide the issue based upon the written
information provided, and the Referee’s decision shall be final, binding and
non-appealable.


 


9.             Allstate
will withhold from settlement payments federal and state withholding amounts as
required by federal and state tax laws.


 


VII.         SETTLEMENT APPROVAL HEARING


 


	
  A hearing has been
  scheduled on 

  	
   

  	
  , 2005 at 10:00 a.m. before the Honorable
  Edward Panelli (Ret.) at Los 

  
	
  Angeles Superior Court, Central Civil West
  Courthouse, Department 309, 600 S. Commonwealth Avenue, Los Angeles, CA 90005
  at which time the Referee will determine: (1) whether the proposed
  settlement should be approved as fair, reasonable and adequate to
  Class Members; and (2) whether the application of
  Class Counsel for an award of attorneys’ fees and expenses should be
  approved and in what amount. The Referee will thereafter report his findings
  to the Court and, if those findings are favorable and approved by the Court,
  an order granting final approval will be entered.

  



 


You are not required to attend
the settlement approval hearing.


 


VIII.        RIGHT TO OBJECT TO THE SETTLEMENT


 


If you
fall within the Class definition and are a Class Member, you will be
bound by any Final Judgment related to this settlement.  If you do not properly complete and mail in a
Claim Form in a timely manner you will not receive any award under the
settlement.  All Class Members will
be bound by a final judgment in this Action.


 


At the
settlement hearing, any Class Member may appear in person or by counsel of
his or her own choosing and at his or her own expense.  To the extent allowed by the Court, such a Class Member
may be heard in opposition to the fairness, reasonableness and adequacy of the
settlement, or to the application for an award of attorneys’ fees and
reimbursement of expenses and costs. 
However, no objector shall be heard in opposition to the settlement
and/or the application for attorneys fees and expenses, nor shall 


	
  any paper or brief submitted by the Objector be
  accepted or considered by the Court, unless, on or before 

  	
   

  	
  , 2005 (the 

  
	
  “Objection Deadline”), the objector (a) files
  with the Referee, the Hon. Edward Panelli (Ret.), at Judicial
  Arbitration & Mediation, 707 Wilshire Blvd., 46th Floor, Los
  Angeles, CA 90017 written notice of such person’s intention to appear,
  together with a written notice of objection and a statement providing the
  basis for the objection, along with any and all documentation in support of
  such objection, and (b) simultaneously serves copies of such notice,
  statement, and documentation, together with copies of any other papers or
  briefs filed with the Referee, upon Class Counsel and Defendant’s
  Counsel as follows:

  



 


 


	
  

  Class Counsel: 

   

  Louis M. Marlin

  Marlin &
  Saltzman

  2400 E. Katella Ave.

  Suite 1030

  Anaheim, CA 92806



  	
  

  Defendant’s Counsel: 

   

  Joel
  E. Krischer

  Latham &
  Watkins LLP

  Suite 4000

  633
  West 5th Street

  Los
  Angeles, CA 90071

  



 


7













 


Sekly v. Allstate


Notice Of Class Action Settlement


 


Any objector who does not
object in the manner provided above shall be deemed to have waived such
objection, and shall forever be foreclosed from objecting to the fairness,
reasonableness or adequacy of the proposed settlement, or any award of
attorneys’ fees or reimbursement of costs and expenses.


 


IX.           REMINDER OF IMPORTANT SETTLEMENT DATES AND DEADLINES


 


The
following are important dates and deadlines under the proposed settlement:


 


	
   

  	
  Objection
  Deadline:

  	
   

  	
   

  
	
   

  	
  Settlement
  Hearing:

  	
   

  	
   

  
	
   

  	
  Proof of Claim
  Deadline:

  	
   

  	
   

  



 


X.            ADDITIONAL INFORMATION


 


For
more detailed information concerning the matters involved in this Action,
reference is made to the pleadings, to the Settlement Agreement, to the Orders
entered by the Court and the Referee, and to the other papers filed in this
Action, which may be inspected at the Clerk of Central Civil West division of
the Court, during regular business hours. 
In addition, the Settlement Agreement can be viewed online at
www.overtimelawsuit.com under the “Allstate” tab.


 


Any
questions concerning the matters contained in this Notice may be directed to
any of the Class Counsel identified above in writing, via e-mail links at
www.overtimelawsuit.com, or by calling Class Counsel at:


 


888-587-7100


 


You may also seek the
advice and counsel of your own attorney, at your own expense, if you
desire.  DO NOT
CONTACT THE COURT OR THE REFEREE.


 


8













 


Sekly v. Allstate


Notice Of Class Action Settlement


Appendix 


 


APPENDIX TO NOTICE OF CLASS ACTION SETTLEMENT


IN


SEKLY v. ALLSTATE


 


The
full scope of the release and waiver that Class Members are providing to
Allstate is set forth in paragraphs 15 through 18 of the Settlement
Agreement.  Those provisions are as
follows:


 


15.          RELEASE BY
ALL CLASS MEMBERS


 


(a)           As of the
Effective Date, the Class Members, including the Named Plaintiff, release
Allstate and each of its subsidiaries, affiliated and parent corporations, and,
as the case may be, each of their respective past, present or future owners,
stockholders, officers, directors, shareholders, employees, agents, principals,
heirs, representatives, accountants, auditors, consultants, insurers and
reinsurers, and its and their respective successors and predecessors in
interest and attorneys, and each of their company-sponsored employee benefit
plans and all of their respective officers, directors, employees,
administrators, fiduciaries, trustees and agents (the “Released Parties”), from
the “Released Claims.” For purposes of this Agreement, the “Released Claims”
are defined as:


 


(1)           All claims, demands,
rights, liabilities, and causes of action of every nature and description
whatsoever, known or unknown, asserted
or that might have been asserted, whether in tort, contract, or for violation
of any state or federal constitution, statute, rule or regulation,
including state wage and hour laws, whether for economic damages, non-economic
damages, restitution, penalties or liquidated damages, arising out of:


 


[a]           any and all facts,
transactions, events, policies, occurrences, acts, disclosures, statements,
omissions or failures to act alleged, or related to acts alleged, in the Class Complaint,
including but not limited to claims: (i) that Allstate did not pay the Class Members
all overtime they were owed for work performed as Class Members in
California; (ii) that Allstate failed to provide Breaks to the Class Members
while they performed work as Class Members in the State of California;
and/or (iii) that Allstate owes wages, waiting-time penalties, penalties,
including any penalties which may be available pursuant to the PAGA, interest,
attorneys’ fees or other damages of any kind related to the claims alleged in
the Class Complaint, at any times on or before the last day of the Class Period
(whether based on California state wage and hour law, contract, or otherwise);
and/or


 


[b]           the causes of action
asserted in the Class Complaint, including but not limited to any and all
claims for alleged failure to pay overtime, for alleged failure to provide
Breaks, for alleged failure to maintain and furnish records of hours worked,
for alleged unlawful conversion of wages, for failure to timely pay wages, for
alleged minimum wage and pay stub violations and related violations of Wage
Orders, for waiting time penalties, and, as related to the foregoing, for
alleged unlawful, unfair and/or fraudulent business practices under California
Business and Professions Code section 17200, et seq.


 


(2)           The Released Claims
include any unknown claims that the Class Members do not know or suspect
to exist in their favor at the time of the release, which, if known by them,
might have affected their settlement with, and release of, the Released Parties
or might have affected their decision not to object to this settlement. With
respect to the Released Claims, the Class Members stipulate and agree
that, upon the Effective Date, the Class Members shall be deemed to have,
and by operation of the Final Judgment shall have, expressly waived and
relinquished, to the fullest extent permitted by law, the provisions, rights
and benefits of Section 1542 of the California Civil Code, or any other
similar provision under federal or state law, which section provides:


 


A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH
THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME
OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.


 


A-1













 


Sekly v. Allstate


Notice Of Class Action Settlement


Appendix


 


(b)           The Class Members
may hereafter discover facts in addition to or different from those they now
know or believe to be true with respect to the subject matter of the Released
Claims, but upon the Effective Date, shall be deemed to have, and by operation
of the Final Judgment shall have, fully, finally, and forever settled and released
any and all of the Released Claims, whether known or unknown, suspected or
unsuspected, contingent or non-contingent, which now exist, or heretofore have
existed, upon any theory of law or equity now existing or coming into existence
in the future, including, but not limited to, conduct that is negligent,
intentional, with or without malice, or a breach of any duty, law or rule,
without regard to the subsequent discovery or existence of such different or
additional facts.


 


(c)           The Class Members,
on behalf of themselves and their respective assigns, agree not to sue or
otherwise make a claim against any of the Released Parties that is in any way
related to the Released Claims.


 


16.          ADDITIONAL
RELEASE BY ALL SETTLEMENT CLASS MEMBERS


 


(a)           As of the
Effective Date, the Settlement Class Members, including the Named
Plaintiff, and any Late Claim Settlement Class Members, in addition to
releasing the Released Parties from the Released Claims as outlined above in
paragraph 15, release the Released Parties from the “Released Federal Claims.”
For purposes of this Agreement, the “Released Federal Claims” are defined as:


 


(1)           All claims, demands,
rights, liabilities, and causes of action of every nature and description
whatsoever, known or unknown, asserted or that might have been asserted,
whether in tort, contract, or for violation of any state or federal
constitution, statute, rule or regulation, including federal wage and hour
laws, whether for economic damages, non-economic damages, restitution,
penalties or liquidated damages, arising out of:


 


[a]           any and all facts,
transactions, events, policies, occurrences, acts, disclosures, statements,
omissions or failures to act alleged, or related to acts alleged, in the Class Complaint,
including all federal claims pursuant to the FLSA, including claims: (a) that
Allstate did not pay the Class Members all overtime they were owed for
work performed as Class Members in the State of California; (b) that
Allstate failed to provide Breaks to the Class Members while they performed
work as Class Members within the State of California; and/or (c) that
Allstate owes wages, waiting time penalties, penalties, including any penalties
which may be available pursuant to the PAGA, interest, attorneys’ fees or other
damages of any kind related to the claims alleged in the Class Complaint, at
any time on or before the last day of the Class Period (whether based on
federal wage and hour law, contract, or otherwise); and/or


 


[b]           the causes of action
asserted in the Class Complaint, including any and all federal claims
arising from the FLSA for alleged failure to pay overtime, for alleged failure
to provide Breaks, for alleged failure to maintain and furnish records of hours
worked, and for alleged unlawful conversion of wages due to Class Members
for hours worked as Class Members within the State of California.


 


(2)           The Released Federal
Claims include any unknown claims that the Settlement Class Members and
any Late Claim Settlement Class Members do not know or suspect to exist in
their favor at the time of the release, which, if known by them, might have
affected their settlement with, and release of, the Released Parties or might
have affected their decision not to object to this settlement. With respect to
the Released Federal Claims, the Settlement Class Members and any Late
Claim Settlement Class Members stipulate and agree that, upon the
Effective Date, the Settlement Class Members and any Late Claim Settlement
Class Members shall be deemed to have, and by operation of the Final
Judgment shall have, expressly waived and relinquished, to the fullest extent
permitted by law, the provisions, rights and benefits of Section 1542 of
the California Civil Code, or any other similar provision under federal or
state law, which section provides:


 


A-2













 


Sekly v. Allstate


Notice Of Class Action Settlement


Appendix


 


A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH
THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME
OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.


 


(b)        The
Settlement Class Members and any Late Claim Settlement Class Members
may hereafter discover facts in addition to or different from those they now
know or believe to be true with respect to the subject matter of the Released
Federal Claims, but upon the Effective Date, shall be deemed to have, and by
operation of the Final Judgment shall have, fully, finally, and forever settled
and released any and all of the Released Federal Claims, whether known or
unknown, suspected or unsuspected, contingent or non-contingent, which now
exist, or heretofore have existed, upon any theory of law or equity now
existing or coming into existence in the future, including, but not limited to,
conduct that is negligent, intentional, with or without malice, or a breach of
any duty, law or rule, without regard to the subsequent discovery or existence
of such different or additional facts.


 


(c)           The
Settlement Class Members and any Late Claim Settlement Class Members,
on behalf of themselves and their respective assigns, agree not to sue or
otherwise make a claim against any of the Released Parties that is in any way
related to the Released Federal Claims. The Released Federal Claims are limited
to Settlement Class Members and any Late Claim Settlement Class Members
claims arising from working in or being based from (during CAT duty) California
claims offices.


 


17.          WAIVER OF
FUTURE PENSION, RETIREMENT AND/OR 401(K) RIGHTS BY ALL SETTLEMENT CLASS MEMBERS


 


As of the Effective Date, the Settlement Class Members
and any Late Claim Settlement Class Members, including the Named
Plaintiff, in addition to releasing the Released Parties from the Released
Claims as outlined above in paragraph 14 and 15, expressly, knowingly and
voluntarily


 


(a)           acknowledge
that none of the
amounts paid under this Agreement constitute either “annual
compensation” or “eligible annual compensation” under the Allstate Retirement
Plan or “eligible compensation” under the Savings and Profit Sharing Fund of
Allstate Employees; and


 


(b)           waive any
and all claims for additional contributions to and/or benefits under any
pension, retirement and/or 401(k) plan maintained or sponsored by Allstate
based on any amount paid under this Agreement.


 


Nothing in this provision or this Agreement shall in
any other way affect the rights of any Class Member to any benefits under
any such plan to which such Class Member may otherwise be entitled in
accordance with the terms of any such plan.


 


18.          WAIVER OF
RIGHTS


 


(a)           Defendant
waives any right it may have to further appeal or contest, in any manner, the
order certifying this matter as a class action or the order granting Plaintiffs’
motion for summary adjudication.


 


(b)           Class Members
waive any right they may have to overtime pay or any other matter alleged in or
related to allegations in the Class Complaint except as provided for in
this Agreement.


 


(c)           The
parties hereto, including the Plaintiff Class, stipulate and agree that the
consideration paid to the Class Members pursuant to this Agreement
compensates the Plaintiff Class for all overtime compensation due to them,
all penalties, all liability for Breaks and any compensation to which they may
be entitled pursuant to the California Labor Code, or the applicable Wage
Order, and any related penalties and as such, the Class Members are not “aggrieved
employees” for purposes of the PAGA, and, therefore, Defendant are not liable
for any penalties pursuant to the PAGA.


 


(d)           The parties
hereto, including the Plaintiff Class, further stipulate and agree that even if
any Class Member is considered or determined to be an “aggrieved employee”
for purposes of the PAGA, said Class Member


 


A-3













 


Sekly v. Allstate


Notice Of Class Action Settlement


Appendix


 


waives any potential right to any penalty prescribed
by the PAGA, the California Labor Code or the applicable Wage Order.


 


(e)           The
parties hereto, including the Plaintiff Class, further stipulate and agree that
Defendant has taken reasonable steps to insure that Breaks are taken as
required by law and that Defendant is in compliance with the California Labor
Code and applicable Wage Order and that Class Counsel has conducted a
reasonable investigation and determined that Defendant is currently in
compliance with the California Labor Code and applicable Wage Order and Breaks
are being provided as required by law.


 


(f)            The
Referee and the Court have reviewed this Agreement and concluded that Plaintiff
Class has been adequately compensated for all violations alleged in the Class Complaint
and to which they otherwise may be entitled and that any additional penalties
pursuant to the PAGA would be an unjust and oppressive award. Accordingly, to
the extent any PAGA penalties could potentially be awarded to the Plaintiff
Class, the Court hereby determines that no PAGA penalties should be awarded.
The parties to this Agreement concur with this determination.


 


A-4













 


EXHIBIT B


 


SEKLY (formerly BEDNAR) vs. ALLSTATE OVERTIME
LITIGATION


CLAIM FORM /FLSA CONSENT FORM


 


INSTRUCTIONS:
To share in the monetary recovery resulting from this settlement, and to
consent to join the federal overtime (FLSA) portion of this action, you must complete, sign and mail this form by first class U.S. mail,
postage paid, postmarked on or before [date], and addressed as follows:


 


SEKLY (formerly BEDNAR) vs. ALLSTATE


c/o Gilardi & Co. LLC, Claims Administrator


P.O. Box xxxx, San Rafael, CA 94912-8060


 


If
your pre-printed address is incorrect, please provide your correct address,
below.


 


	
  /////////////////-ALLSTATE
  [CLAIM #]

  	
   

  	
   

  	
  Name/Address
  Change:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [First] [Middle]
  [Last]

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [Address]

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [City], [State]
  [Zip]

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Phone Number
  (Work):

  	
  (___)
  _____________

  	
   

  	
  Phone Number
  (Home): (___) _______________

  
	
  Phone Number
  (Cell):

  	
  (___)
  _____________

  	
   

  	
  Social Security
  Number: ______-____-______

  



 


Allstate’s records
indicate that you were employed as a Class Member in California and, if
applicable, that you worked the number of days for catastrophe (“CAT”) duty
indicated below for each of the following years in the Class Period (for
1996 only the maximum number of months is 1 and CAT days are not
applicable):.  


 


	
  Calendar

  Year

  	
   

  	
  Months in

  Class

  	
   

  	
  CAT Days

  worked

  	
   

  
	
  1996

  	
   

  	
   

  	
   

  	
  N/A

  	
   

  
	
  1997

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1998

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1999

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2000

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2001

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2002

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2003

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2004

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


If you believe that this
information is incorrect, please provide a written explanation of your
basis for disputing Allstate’s records together with this Claim Form.  Please enclose your written statement, along
with copies of any relevant documents, in the same envelope in which you
return this claim form.  Allstate will
respond to your position in writing and you will thereafter be given the
opportunity to reply to that response. 
Thereafter, the Referee assigned to this case, the Hon. Edward Panelli
(Ret.) will rule upon this dispute and his decision will be final and
non-appealable.  BY SUBMITTING THIS CLAIM
FORM, YOU ARE GIVING UP YOUR RIGHT TO CHALLENGE THIS INFORMATION UNLESS YOU INCLUDE YOUR WRITTEN EXPLANATION FOR THE CHALLENGE WITH THIS
CLAIM FORM.  HOWEVER, THIS
CLAIM FORM MUST BE COMPLETED AND SUBMITTED IN


 













 


ORDER TO PARTICIPATE IN
THE SETTLEMENT.


 


Please be aware that
Allstate will withhold taxes from the portion of any settlement award
attributed to wages, and a 1099 form will be issued for the portion attributed
to interest and/or penalties.


 


	
  If your wages
  are subject to supplemental tax withholding as a result of a lien or
  outstanding debt, please indicate so by checking 

  
	
  this box: [

  	
   

  	
   ]

  



 


 


DECLARATION


 


By signing this Claim
Form, I am declaring under penalty of perjury that at some time while working
as a Class Member (as defined in the Class Notice) during this class
period, I worked overtime1. 
Further, by signing and submitting this Claim Form I agree to
participate in this settlement.  By doing
so, I agree that the settlement represents a full and final settlement of any
and all claims I may have or could have against Allstate for overtime
compensation, and any other related claims as described in, and subject to, the
Settlement and Class Notice.


 


I have reviewed the Class Notice
and this Claim Form and I also consent to join in the Federal Fair Labor Standards
Act (“FLSA”) portion of this action and have the Named Plaintiffs and their
counsel represent me in this action pursuant to 29 USC § 216(b).


 


 


	
  X

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (Sign Your Name Here)

  	
   

  	
  Date

  	
   

  



 










1               Overtime
is defined as time worked over 8 hours in one work day or over 40 hours in one
work week, for the period from November 27, 1996 through 1997, and from January 1,
2000 through the present.  For the period
of 1998 and 1999, overtime is defined as time worked over 40 hours in one work
week.


 













 


EXHIBIT C


 


SEKLY
(formerly BEDNAR) vs. ALLSTATE OVERTIME LITIGATION


 


EXCLUSION
REQUEST FORM 


 


SUBMIT THIS
FORM IF YOU WISH TO BE EXCLUDED


FROM
PARTICIPATING IN THE CLASS ACTION SETTLEMENT


 


 By signing and returning this form, I
represent that it is my intent to exclude myself from participating in the
settlement of the class action entitled Sekly
(formerly Bednar) vs. Allstate Insurance Company, et.al., Los
Angeles Superior Court Case No. BC 240813. 
I have read the Notice of Class Action Settlement, and I represent
that the information set forth below is accurate.


 


 


	
  Name:

  	
   

  	
   

  	
   

  
	
  (Please Print)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Telephone No.:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   Send this form postmarked by

  	
   

  	
  , 2005 [30 days] to:

  
											



 


SEKLY (formerly BEDNAR) vs.
ALLSTATE


c/o Gilardi & Co.
LLC, Claims Administrator 


P.O. Box xxxx, San
Rafael, CA 94912-8060


 













 


EXHIBIT D


 


SUPERIOR COURT OF THE STATE OF
CALIFORNIA


 


COUNTY OF LOS ANGELES, CENTRAL
CIVIL WEST


 


	
  WILLIAM SEKLY, an individual;

  each on his own behalf and on behalf

  of all others similarly situated,

  	
   

  	
  CASE NO. BC240813

  

  CLASS ACTION

  
	
   

  	
   

  	
   

  
	
  Plaintiffs,

  	
   

  	
  Assigned To:

  	
  Honorable Anthony J. Mohr

  Department 309

  
	
  v.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Proposed] ORDER GRANTING FINAL

  
	
  ALLSTATE INSURANCE
  COMPANY,

  an Illinois corporation,

  	
   

  	
  APPROVAL OF CLASS SETTLEMENT,

  AWARD OF ATTORNEYS’ FEES AND

  
	
   

  	
   

  	
  COSTS, AND RELEASE OF ALL CLAIMS

  
	
  Defendant.

  	
   

  	
  BY CLASS MEMBERS

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 


The
Court has received, reviewed and considered the report by the Court-appointed
Referee, the Hon. Edward Panelli (Ret.) concerning final approval of the
settlement of this class action and final approval of the application by Class Counsel
for an award of attorneys’ fees and reimbursement of costs.  In addition the Court has received and
reviewed the Report of Class Counsel Re: Final Approval of Class Settlement
and has received and reviewed the proposed Class Action Settlement
Agreement (“Settlement Agreement”) itself.


 


GOOD
CAUSE APPEARING THEREFORE, this Court makes the following ORDER:


 


1.             The
Plaintiff Class covered by this Order is defined as follows:


 


(a)           Plaintiff
Class Defined


 


[Proposed] ORDER GRANTING FINAL
APPROVAL


 













 


All persons who, at any time between November 27, 1996 and December 31,
2004 (the “Class Period”) were employed by Allstate in California as
claims adjusters.  As used in this
definition, the term “claims adjuster” refers to any individual whose primary
assigned duties as an employee of Allstate included or currently include, but
were not limited to, the adjustment and/or investigation and/or analysis and/or
evaluation of the monetary worth of any claim made to Allstate for any bodily
injury, property damage, and/or monetary damage of every nature and type and
who were paid as exempt employees during the Class Period as the same are
defined pursuant to statute and/or California or federal regulatory
determination.


 


(b)           Job
Titles Specifically Included in the Plaintiff Class


 


The job titles specifically encompassed by the definition of “claims
adjuster” include, from various times during the Class Period:


 


Claim Representative


 


Senior Claim Representative


 


Staff Claim Representative


 


Senior Staff Claim Representative


 


Staff Claim Analyst


 


Claim Adjuster


 


Senior Claim Adjuster


 


Staff Claim Adjuster


 


Senior Staff Claim Adjuster


 


Staff Claim Analyst


 


Claim Service Adjuster


 


Senior Claim Service Adjuster


 


Staff Claim Service Adjuster


 


Appraisers


 


Claims Specialist


 


Claims Consultant


 


[Proposed] ORDER GRANTING FINAL
APPROVAL


 


2













 


Evaluation Consultants


 


Damage Evaluators


 


Quality Evaluators


 


Extra Contractual Liability Specialists


 


Although the Court previously ruled that claims adjusters in the
Special Investigation Unit and/or as Subrogation Adjusters were not included in
the Plaintiff Class, and although Evaluation Consultants, Damage Evaluators,
Quality Evaluators and Extra Contractual Liability Specialists were previously
excluded from the Plaintiff Class, the Plaintiffs and Allstate have expressly
agreed that such persons shall be included in the Plaintiff Class in order
for this settlement to be effectuated, and the negotiations specifically
included and contemplated said persons being in the Plaintiff Class.


 


(c)           Persons
expressly excluded from the Plaintiff Class:


 


Persons who performed such functions while classified, employed and
compensated by Allstate as supervisors, managers or officers of Allstate are
not included in the Plaintiff Class during any time said persons were so
employed.  Persons performing work in the
following job titles (as the work duties and responsibilities of said titles
existed as of the date of certification) are not included in the defined class
during any period of time said position was or is held during the Class Period:  Frontline Process Experts, Frontline
Performance Leaders and supervisory personnel.


 


(d)           Previous
Opt Outs from the Plaintiff Class:


 


The parties recognize that certain persons previously elected to
opt-out of the Plaintiff Class either at the time notice of class
certification for liability or notice of class certification for damages were
served, and that, by agreement of the parties made prior to this Agreement,
certain of those persons have been permitted to opt back into the Plaintiff
Class.  The parties have expressly agreed
as part of the consideration for this Agreement, that all persons who
previously opted out but have not previously opted back in shall be permitted
to opt back into the Plaintiff Class by the timely presentation submission
of a Claim Form as described more in the Settlement Agreement, and that
the negotiations


 


[Proposed] ORDER GRANTING FINAL
APPROVAL


 


3













 


specifically included and contemplated said persons being given such
opportunity.  Any such person who fails
to submit a timely Claim Form will remain excluded from the Plaintiff
Class.


 


2.             The
Settlement Agreement is granted final approval. 
It appears, and this Court finds, that the Settlement Agreement has no
obvious defects, is fair, reasonable and adequate, was negotiated in good faith
and at arms’ length and is in the best interests of the Plaintiff Class as
a whole.  This Court further orders the
parties to carry out the provisions of the Settlement Agreement.


 


3.             The
Court hereby grants and approves the application presented by Class Counsel
for an award of attorneys fees in the amount of 33-1/3% of the Potential
Maximum Consideration (as defined in the Settlement Agreement), for a total of
Forty Million Dollars ($40 million).


 


4.             The
Court hereby grants and approves the application presented by Class Counsel
for reimbursement of expenses in the sum of Eight Hundred Thousand Dollars
($800,000).  The Court notes and
understands that a portion of this sum represents an estimate of future costs,
and orders that any such costs not incurred shall remain as a portion of the “Potential
Gross Individual Settlement Proceeds” as defined in paragraph 8(a) of the
Settlement Agreement and shall be available for distribution to Class Members
in accordance with the terms of the Settlement Agreement.


 


5.             The
Court hereby grants and approves the application for payment of the costs of
administration of the Settlement Agreement (including the Referee’s fee and the
Claims Administrator’s fee) in the sum of Eight Hundred Thousand Dollars
($800,000).  The Court notes and understands
that a portion of this sum represents an estimate of future costs and orders
that any such costs not incurred shall remain as a portion of the Potential
Gross Individual Settlement Proceeds and shall be available for distribution to
Class Members in accordance with the terms of the Settlement Agreement.


 


6.             The
Referee is empowered to hear any remaining disputes between the parties, to
determine the timeliness of Claim Forms, to resolve administrative and/or
procedural issues that


 


[Proposed] ORDER GRANTING FINAL
APPROVAL


 


4













 


may arise and to
take other actions contemplated by and/or necessary to the implementation of
the Settlement Agreement.  Except as to
such actions that are expressly made final and binding by the terms of the
Settlement Agreement, all such actions of the Referee shall be subject to
ratification by the Court


 


	
  7.             As of the “Effective Date” (as
  defined in paragraph 13(a) of the Settlement Agreement), the Court
  hereby dismisses with prejudice all actions, complaints and claims and any
  lawsuit as against Allstate and/or the “Released Parties” (as defined in
  paragraph 15(a) of the Settlement Agreement) arising out of or related
  to any of the actions or events complained of in the Amended 

  
	
  Complaint filed
  herein on or about 

  	
   

  	
   (the “Class Complaint”).

  



 


8.             As
of the Effective Date, the Court adjudges that


 


(a)           all
Class Members are conclusively deemed to have released the Released
Parties from the “Released Claims” (as defined in paragraph 15(a) of the
Settlement Agreement); and


 


(b)           all
Settlement Class Members and any Late Claim Settlement Class Members
(as those terms are defined in paragraphs 7(d)(4) and 7(f)(2),
respectively, of the Settlement Agreement) in addition to releasing the Released
Parties from the Released Claims, are conclusively deemed to have (i) released
the Released Parties from the “Released Federal Claims” as defined in paragraph
16(a) of the Settlement Agreement, and (ii) acknowledged that none of
the amounts paid under the Settlement Agreement constitute either “annual
compensation” or “eligible annual compensation” under the Allstate Retirement
Plan or “eligible compensation” under the Savings and Profit Sharing Fund of
Allstate Employees, and waived any and all claims for additional contributions
to and/or benefits under any pension, retirement and/or 401(k) plan maintained
or sponsored by Allstate based on any amount paid under the Settlement
Agreement.


 


9.             The
Court bars and permanently enjoins each Class Member from prosecuting
against the Released Parties any and all of the settled claims which the Class Members
or any of them had, have or may have in the future, arising out of, based upon,
or otherwise related to any


 


[Proposed] ORDER GRANTING FINAL
APPROVAL


 


5













 


of the settled
claims, or any of the allegations contained in the Class Complaint.


 


10.           The
Court bars and permanently enjoins each person in the Plaintiff Class who
opted not to participate in the settlement (or who having previously opted out,
chose not to submit a Claim Form) from participating in any future class action
regarding the claims raised in the Class Complaint.


 


11.           The
Court reserves continuing jurisdiction as provided hereinabove.


 


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Hon. Anthony Mohr

  
	
   

  	
   

  	
  Judge of the Superior
  Court

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
				



 


[Proposed] ORDER GRANTING FINAL
APPROVAL


 


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EXHIBIT E


 


SUPERIOR COURT OF THE STATE OF
CALIFORNIA


 


COUNTY OF LOS ANGELES, CENTRAL
CIVIL WEST


 


	
  WILLIAM SEKLY, an individual;

  each on his own behalf and on behalf

  of all others similarly situated,

  	
   

  	
  CASE NO. BC240813

  

  CLASS ACTION

  
	
   

  	
   

  	
   

  
	
  Plaintiffs,

  	
   

  	
  Assigned To:

  	
  Honorable Anthony J. Mohr

  Department 309

  
	
  v.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [Proposed] JUDGMENT

  
	
  ALLSTATE INSURANCE COMPANY,

  an Illinois corporation,

  	
   

  	
   

  
	
   

  	
   

  
	
  Defendant.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  



 


	
  The Court, on 

  	
   

  	
   2005, issued its Order Granting Final
  Approval of Class Settlement, Award of Attorneys’ Fees 

  
	
  and Costs, and
  Release of All Claims by Class Members, (“Order Granting Final Approval”) granting
  approval to the Class Action Settlement Agreement (“Settlement
  Agreement”) in this matter.

  



 


Pursuant
to Rule of Court 1859(h) the Court ORDERS ENTRY OF JUDGMENT as
follows:


 


1.             The
Plaintiff Class as to whom this judgment applies is defined as follows:


 


(a)           Plaintiff
Class Defined


 


All persons who, at any time between November 27, 1996 and December 31,
2004 (the “Class Period”) were employed by Allstate in California as
claims adjusters.


 


[Proposed] JUDGMENT


 













 


As used in this definition, the term “claims adjuster” refers to any
individual whose primary assigned duties as an employee of Allstate included or
currently include, but were not limited to, the adjustment and/or investigation
and/or analysis and/or evaluation of the monetary worth of any claim made to
Allstate for any bodily injury, property damage, and/or monetary damage of
every nature and type and who were paid as exempt employees during the Class Period
as the same are defined pursuant to statute and/or California or federal regulatory
determination.


 


(b)           Job
Titles Specifically Included in the Plaintiff Class


 


The job titles specifically encompassed by the definition of “claims
adjuster” include, from various times during the Class Period:


 


Claim Representative


 


Senior Claim Representative


 


Staff Claim Representative


 


Senior Staff Claim Representative


 


Staff Claim Analyst


 


Claim Adjuster


 


Senior Claim Adjuster


 


Staff Claim Adjuster


 


Senior Staff Claim Adjuster


 


Staff Claim Analyst


 


Claim Service Adjuster


 


Senior Claim Service Adjuster


 


Staff Claim Service Adjuster


 


Appraisers


 


Claims Specialist


 


Claims Consultant


 


Evaluation Consultants


 


Damage Evaluators


 


[Proposed] JUDGMENT


 


2













 


Quality Evaluators


 


Extra Contractual Liability Specialists


 


Although the Court previously ruled that claims adjusters in the
Special Investigation Unit and/or as Subrogation Adjusters were not included in
the Plaintiff Class, and although Evaluation Consultants, Damage Evaluators,
Quality Evaluators and Extra Contractual Liability Specialists were previously
excluded from the Plaintiff Class, the Plaintiffs and Allstate have expressly
agreed that such persons shall be included in the Plaintiff Class in order
for this settlement to be effectuated, and the negotiations specifically
included and contemplated said persons being in the Plaintiff Class.


 


(c)           Persons
expressly excluded from the Plaintiff Class:


 


Persons who performed such functions while classified, employed and
compensated by Allstate as supervisors, managers or officers of Allstate are
not included in the Plaintiff Class during any time said persons were so
employed.  Persons performing work in the
following job titles (as the work duties and responsibilities of said titles
existed as of the date of certification) are not included in the defined class
during any period of time said position was or is held during the Class Period:  Frontline Process Experts, Frontline
Performance Leaders and supervisory personnel.


 


(d)           Previous
Opt Outs from the Plaintiff Class:


 


The parties recognize that certain persons previously elected to
opt-out of the Plaintiff Class either at the time notice of class
certification for liability or notice of class certification for damages were
served, and that, by agreement of the parties made prior to this Agreement,
certain of those persons have been permitted to opt back into the Plaintiff
Class.  The parties have expressly agreed
as part of the consideration for this Agreement, that all persons who
previously opted out but have not previously opted back in shall be permitted
to opt back into the Plaintiff Class by the timely presentation submission
of a Claim Form as described more in the Settlement Agreement, and that
the negotiations specifically included and contemplated said persons being
given such opportunity.  Any such person
who fails to submit a timely Claim Form will remain excluded from the


 


[Proposed] JUDGMENT


 


3













 


Plaintiff Class.


 


2.             Persons
who requested exclusion and/or remain excluded from the Plaintiff Class (a) will
not participate in the recovery obtained through the Settlement Agreement and (b) are
entitled to prosecute an individual lawsuit, or an individual claim with the
California Labor Commissioner, in accordance with California law, but may not
pursue any claim as part of a class action.


 


3.             The
parties shall comply with the terms and conditions of the Settlement Agreement
and of the Order Granting Final Approval. 
Upon such compliance, and in accordance with the terms of the Order
Granting Final Approval, the matter and the First Amended Complaint on file
herein shall be dismissed in its entirety, with prejudice.  The Court retains jurisdiction over the
parties to enforce the terms of this judgment.


 


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Hon. Anthony Mohr

  
	
   

  	
   

  	
  Judge of the Superior
  Court

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
				



 


[Proposed] JUDGMENT


 


4