UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

YITZCHOK ROKOWSKY, on behalf of

himself and all others similarly situated,

Plaintiff,

v.

VERICITY, INC.; MEMBERS MUTUAL;

FIDELITY LIFE ASSOCIATION; and APEX

HOLDCO L.P., ERIC RAHE, CALVIN

DONG, SCOTT PERRY, RICHARD

HEMMINGS, JAMES E. HOHMANN,

JAMES SCHACT, LINDA WALKER

BYNOE, STEVEN GROOT, JOHN FIBIGER,

AND NEIL ASHE

Defendants.

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Case No.

JURY TRIAL DEMANDED

COMPLAINT

Plaintiff Yitzchok Rokowsky, on behalf of himself and others similarly situated, by his

undersigned attorneys, hereby sues Defendants Vericity, Inc. (“Vericity”), Members Mutual

Holding Company (“Members Mutual”), Fidelity Life Association (“Fidelity Life”), Apex

Holdco L.P. (“Apex Holdco”), Eric Rahe, Calvin Dong, Scott Perry, Richard Hemmings, James

E. Hohmann, James Schact, Linda Walker Bynoe, Steven Groot, John Fibiger, and Neil Ashe

(collectively the “Individual Director Defendants”) and in support thereof alleges as follows:

I. INTRODUCTION

1. Defendant Fidelity Life is a legal reserve life insurance company organized under

the laws of Illinois. Plaintiff and members of the Class (as defined herein) were life insurance

policyholders in Fidelity Life and, as a result, were members of Members Mutual, a mutual

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insurance holding company organized under the laws of Illinois. Members Mutual is the parent

of Fidelity Life.

2. In 2018, Members Mutual adopted a Stock Conversion Plan (“the Plan”) for the

purpose of converting Members Mutual from a mutual to stock form of organization. Pursuant

to the Plan, upon conversion of Members Mutual to stock form, Defendant Vericity, a stock

holding company, was to acquire all stock of Members Mutual and thus be wholly owned by

Vericity. In turn, and also pursuant to the Plan, shares in Vericity would be listed on NASDAQ

(symbol “VERY”) and offered initially to eligible members of Members Mutual (Plaintiff and

the Class) for $10.00 per share.

3. The Plan, however, was structured so as to improperly constrain Plaintiff and the

Class members’ rights to acquire stock in Vericity in favor of Vericity’s management team,

directors and advisory board members and a third-party purchaser. The Plan was structured and

executed in such a fashion that it breached Vericity’s and its directors’ basic fiduciary duties to

the members, Plaintiff and the Class.

4. The Plan purported to offer a combined 14,875,000 shares in a subscription

offering and community offering, but its real purpose was to shift control of Vericity away from

its individual members, Plaintiff and the Class, to a holding company, Defendant Apex Holdco,

the affiliate of the private equity firm, J.C. Flowers & Co., LLC, whose Managing Director,

Defendant Eric Rahe, is also Vericity’s Board Chairman. In exchange, Vericity’s executives

would acquire an ownership interest in Apex Holdco.

5. To complete the Plan, two requirements needed to be satisfied: (1) a minimum of

14,875,000 shares of common stock needed to be sold; and (2) the plan needed two-thirds

approval of Vericity shareholders. To secure approval, pursuant to a Stand-by Purchaser

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Agreement (defined herein), Apex Holdco was enlisted as the stand-by purchaser, to make-up

the difference in any shortfall of purchases of common stock by the members to guarantee the

sale of 14,875,000 shares.

6. Unfortunately for Plaintiff and the Class, the fix was in. Publicly, Vericity

reported that a total of 20,125,000 shares were offered on a first-priority basis to eligible

members of Members Mutual (i.e., Plaintiff and the Class) and on a second-priority basis to the

directors and officers of Members Mutual. Vericity actually allocated 2,123,675 million shares to

its directors and officers. Then, secondly, Vericity unilaterally capped the amount of shares that

Plaintiff and the Class members could purchase at 3,501,648, thus guaranteeing that Apex

Holdco’s obligations as the stand-by purchaser would be triggered. Ultimately, Apex Holdco

acquired 11,373,352 of 14,875,000 shares—76.5% of Vericity’s outstanding shares.

7. In reality, and subject to the duties owed to shareholders, the stand-by purchaser

should have only been permitted to exercise its purchase rights if the original shareholders,

Plaintiff and the Class, did not exercise their own rights to reach the minimum amount of shares.

As a result of this allocation of shares directly to the stand-by purchaser, Plaintiff and the Class

have suffered damages.

8. For sure, the Prospectus itself acknowledged in the section titled “Risks Relating

to Ownership of Our Common Stock” that if the third-party purchaser acquired substantial

ownership rights in Vericity, shareholders (Plaintiff and the Class) would not be afforded certain

protections that stockholders of non-controlled companies have. Specifically, the Prospectus

warned:

[i]f the standby purchaser acquires a majority of the shares of our

common stock in the standby offering, the standby purchaser will

control a majority of the voting power of our outstanding common

stock and will hold a controlling interest in us. As a result, we

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would qualify as a “controlled company” within the meaning of the

corporate governance rules of Nasdaq. “Controlled companies”

under those rules are companies of which more than 50% of the

voting power is held by an individual, a group or another company.

If we become a “controlled company” upon the completion of the

offerings, we will avail ourselves of the “controlled company”

exception under the Nasdaq rules, in which event we will not be

required not to comply with certain corporate governance

requirements, including: the requirement that a majority of our

board of directors consist of independent directors; the

requirement that we have a nominating and corporate governance

committee that is composed entirely of independent Directors, or

otherwise have director nominees selected by vote of a majority of

the independent directors; the requirement that we have a

compensation committee that is composed entirely of independent

directors; and the requirement for an annual performance

evaluation of the nominating and corporate governance and

compensation committees. If the standby purchaser acquires a

majority of our shares in the standby offering and we become a

“controlled company,” you will not have the same protections

afforded to stockholders of companies that are subject to all of

the Nasdaq corporate governance requirements.

Prospectus at 27 (emphasis added).

9. These were not “Risks” as described by the Prospectus, rather shifting the

company away from the members into a “controlled company” was the desired outcome of

Vericity and the Individual Director Defendants.

10. After the transaction closed and Apex Holdco assumed a majority interest in

Vericity and without the protections afforded shareholders in non-controlled companies, the

Board of Directors announced a special one-time cash distribution of $6.25 per share to common

stockholders, which was paid on December 9, 2019. Based on the current number of shares

outstanding, the cash distribution was expected to total approximately $93 million, with the

Board of Directors receiving $13,272,968.75 and Apex Holdco receiving $71,083,450.

11. Plaintiff seeks recovery on behalf of himself and the Class against Defendants,

and brings this action under the Court’s diversity jurisdiction as expanded by the Class Action

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Fairness Act of 2005, asserting: (i) Illinois statutory claims for the improper deal Defendant

Vericity entered into when it consummated the Stand-by Purchaser Agreement with Apex

Holdco to the detriment of its existing members and (b) violations of state common law claims

for breach of fiduciary duty, breach of contract, unjust enrichment and negligence.

II. JURISDICTION AND VENUE

12. This Court has diversity jurisdiction over the subject matter of the foregoing state

law claims asserted in this class action, pursuant to the provisions of 28 U.S.C. § 1332(d)(2),

because the parties are citizens of diverse states and the amount in controversy, aggregating the

claims of all class members, exceeds the sum of $5,000,000. The named Plaintiff is a citizen of

New Jersey, and Defendant is considered a citizen of Delaware (state of incorporation) and

Illinois (principal place of business) for purposes of 28 U.S.C. § 1332(c)(1). Thus, the named

Plaintiff (and one or more of the unnamed class members) is a citizen of a state different from at

least one of the Defendants.

13. Venue is proper over the foregoing diversity claims within this District because

the Vericity Defendants (defined herein) maintain their principal place of business in Illinois.

III. PARTIES

A. Plaintiff

14. Plaintiff Yitzchok Rokowsky is an individual residing in New Jersey who was a

member of Members Mutual as of July 31, 2018. On or about July 29, 2019, Plaintiff received

the Plan and a stock purchase form. Plaintiff’s stock purchase agreement, however, restricted

him to purchasing 124 shares of stock at $10 per share for a total of $1,240. Plaintiff raised his

desire to purchase more stock with the Board of Directors. His request was rejected. Under

protest, Plaintiff purchased the limited shares of additional stock he was allocated.

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B. Corporate Defendants

15. Defendant Vericity offers life insurance protection to the middle American

market, targeting domestic households with incomes of between $50,000 and $125,000. It

conducts its business through its two operating subsidiaries: (1) Fidelity Life and (2) Efinancial,

LLC. Fidelity Life distributes its life insurance products through Efinancial and unaffiliated

agents. Efinancial, LLC is a call center-based insurance agency, which markets products for

Fidelity Life. According to the Vericity prospectus (“Prospectus”) filed with the U.S. Securities

Exchange Commission (“SEC”) on June 20, 2019, to effectuate its business plan, Vericity

“requires access to a large quantity of quality sales leads [from third party lead vendors] to keep

[its] retail call center agents productive” and it “supplement[s] that lead flow with leads we

generate ourselves.” Vericity is incorporated in Delaware and its principal place of business is

8700 W. Bryn Mawr Avenue, Suite 900S, Chicago, Illinois, 60631.

16. Defendant Fidelity Life is a legal reserve life insurance company organized under

the laws of Illinois. In 2007, Defendant Fidelity Life completed a reorganization through which it

converted from a mutual insurance company to a stock insurance company. As part of this

reorganization, Members Mutual was formed as an Illinois mutual insurance holding company,

and Fidelity Life continued as an Illinois stock life insurance company.

17. Defendant Members Mutual was, until 2019, a mutual insurance holding company

organized under the laws of Illinois, with executive offices located in Chicago, Illinois.

18. Vericity, Fidelity Life and Members Mutual collectively are referred to as the

“Vericity Defendants.”

19. Defendant Apex Holdco is an affiliate of J.C. Flowers IV L.P., a private equity

fund advised by J.C. Flowers & Co. LLC. On October 25, 2018, the Vericity Defendants entered

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into a Stand-by Purchaser Agreement with Apex Holdco which ultimately allowed Apex Holdco

to acquire the majority of Vericity’s outstanding common shares.

C. Individual Director Defendants

20. Defendant, Eric Rahe, is a citizen of the state of New York, who serves as the

Chairman of Vericity’s Board. Defendant Rahe also serves as the Managing Director of J.C.

Flowers & Co. LLC a private equity firm, which is an affiliate of Apex Holdco, the Stand-by

Purchaser.

21. Defendant, Calvin Dong is a citizen of the State of New York who was elected to

Vericity’s board of directors in 2019. Mr. Dong is Vice President at J.C. Flowers & Co., LLC,

which is an affiliate of Apex Holdco, the Stand-by Purchaser.

22. Defendant, Scott Perry is a citizen of the State of Florida who was elected to

Vericity’s board of directors in 2019. Mr. Perry has been the CEO of AmeriLife Group Holdings

since 2016, which is a portfolio company of a fund advised by J.C. Flowers & Co. LLC, which is

an affiliate of Apex Holdco, the Stand-by Purchaser.

23. Defendant, Richard Hemmings, is a citizen of the State of Illinois, who was

elected to the board of directors of Vericity in 2013. Mr. Hemmings served as the Chairman of

the board of directors of Members Mutual since its formation in 2007. From 2007 until 2014,

Mr. Hemmings also served as the President and Chief Executive Officer of Members Mutual.

Mr. Hemmings was permitted to purchase 193,375 shares of Vericity stock as part of the

demutualization.

24. Defendant, James E. Hohmann is a citizen of the State of Illinois, who has served

as a director and Chief Executive Officer of Vericity since September 2014. Mr. Hohmann also

served as President, and Chief Executive Officer of Members Mutual. Mr. Hohmann also worked

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as a private consultant in the life insurance industry, including providing consulting services for

Members Mutual. Mr. Hohmann was permitted to purchase 600,000 shares of Vericity stock as

part of the demutualization.

25. Defendant, James W. Schacht is a citizen of the State of Illinois, who was elected

to Vericity’s board of directors in 2013. Mr. Schacht served on the board of directors for

Members Mutual since 2007. Mr. Schacht was permitted to purchase 10,000 shares of Vericity

stock as part of the demutualization.

26. Defendant, Linda Walker Bynoe is a citizen of the State of Illinois who previously

served on Vericity’s board of directors until 2018. Ms. Byone was permitted to purchase 75,000

shares of Vericity stock as part of the demutualization.

27. Defendant, Steven L. Groot is a citizen of the State of Illinois who previously

served on Vericity’s board of directors until 2018. Mr. Groot was permitted to purchase 193,375

shares of Vericity stock as part of the demutualization.

28. Defendant, John A. Fibiger is a citizen of the State of Texas who previously

served on Vericity’s board of directors. Mr. Fibiger was permitted to purchase 10,000 shares of

Vericity stock as part of the demutualization.

29. Defendant, Neil Ashe is a citizen of the State of California who was elected to

Vericity’s board of directors in 2019.

IV. FACTUAL BACKGROUND

A. Members Mutual is Formed

30. In 2007, Fidelity Life completed a reorganization through which it converted from

a mutual to a stock insurance company. As part of this reorganization, Members Mutual was

formed as an Illinois mutual insurance holding company and Fidelity Life continued as an

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Illinois stock life insurance company. Each share of Fidelity Life was issued to Vericity

Holdings, which was, at the time, an intermediate holding company and a wholly-owned

subsidiary of Members Mutual.

31. According to the Prospectus, the following chart was the corporate structure prior

to the consummation of the Stock Conversion Plan, as defined in ¶¶ 33-51, below:

32. Members Mutual did not have stockholders, but instead had members who were

either holders of an in-force individual insurance policy issued by Fidelity Life or holders of a

group master policy also issued by Fidelity Life.

33. Similar to stockholders, Members Mutual’s members had certain rights with

respect to that company, including voting rights for the election of directors and approval of

certain transactions.

34. Unlike a shareholder, a member’s interests do not exist separately from the

insurance policies issued by Fidelity Life. Thus, membership interests are extinguished by

surrender, death, or lapse or cancellation of a policy.

B. The Illinois Statutory Scheme for Demutualization

35. The demutualization of a mutual insurance company results in the exchange of the

participating policyholders’ rights and, at times, the other net assets of that company for the

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rights of stockholders in the new stock insurance company. In other words, the value of the

policies is exchanged for stock. The right to participate as a policyholder in surplus and the right

to share in distribution of surplus and other net assets in liquidation are relinquished upon

demutualization, except to the extent of policyholder dividends paid from certain assets Vericity

refers to as Block A in the “Closed Block.”

36. Demutualization can be beneficial to a converted company by allowing it to raise

capital by trading shares. Policyholders can also receive a benefit by being compensated for

their ownership stake, typically through cash settlements, stock in the newly-formed company,

an increase in policy cash values, or some combination of benefits.

37. Under Illinois law—215 ILCS § 5/59.1—governing demutualization, in

connection with its conversion from a mutual insurance company to a stock insurance company,

Members Mutual was required to provide eligible members with subscription rights, without

payment, to purchase a portion of the capital stock of the converted stock company or,

alternatively, a portion of a corporation owned by the mutual company for purposes of acquiring

or holding all of the converted company’s stock or a stock insurance company into which the

mutual company will be merged. These subscription rights are to be allocated to eligible

members through a fair and equitable formula, which may take into account how different

classes of policies of the eligible members contributed to the mutual company’s surplus.

38. Only if there is an undersubscription of capital stock by eligible members

exercising their subscription rights can shares be sold in a public offering. The Illinois statutory

scheme expressly addresses undersubscription in the conversion of a mass mutual to a stock

company: “[i]f the number of shares of capital stock not subscribed by eligible members is so

small or the additional time or expense required for a public offering of those shares would be

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otherwise unwarranted under the circumstances, the plan of conversion may provide for the

purchase of the unsubscribed shares by a private placement or other alternative method approved

by the Director that is fair and equitable to the eligible members.” 215 ILCS § 5/59.6(e)

(“Conversion to a Stock Company – Undersubscription”). Likewise, if there is an

oversubscription, the code sets out how the conversion plan should provide fair and equitable

means for the allocation of shares of capital stock. Id., § 5/59.6(d) (“Oversubscription”).

39. The conversion plan may, but is not required to, provide subscription rights to

officers and directors of the mutual company. Id., § 5/59.7(a) (“Directors and officers

subscription rights”). If the plan calls for such subscription rights, they should also be allocated

through a fair and equitable formula. The total number of shares that may be purchased by

officers and directors under such a plan takes into consideration the total assets of the mutual

company. For instance, the total number of shares that may be purchased by directors and

officers may not exceed 35% of the total number of shares issued where the mutual company has

total assets of less than $50 million, or 25% of the total shares issued where the mutual company

has total assets of more than $500 million. Id., § 5/59.7(a)(ii). For mutual companies with total

assets between $50 million and $500 million, the total number of shares that may be purchased

shall be interpolated. Id.

40. The Illinois statutory scheme also requires that a stock conversion plan limit any

one person or group of persons acting in concert from acquiring, “through public offering or

subscription rights, more than 5% of the capital stock of the converted stock company for a

period of 5 years from the effective date of the plan except with the approval of the Director.”

Id., § 5/59.6(i) (“Limitations on acquisition of control”).

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41. A “conflict of interest” in the statute prohibits any “director, officer, agent, or

employee of the mutual company or any other person” from receiving “any fee, commission, or

other valuable consideration, other than his or her usual regular salary and compensation, for in

any manner aiding, promoting, or assisting in the conversion except as set forth in the plan

approved by the Director.” Id., § 5/59.12. This provision does not prohibit the payment of

reasonable fees and compensation to attorneys, accountants and actuaries for services performed

in the independent practice of their professions, even if the attorney, accountant, or actuary is

also a Director of the mutual company.

42. The Illinois statutes also allow for a “tax-qualified employee stock benefit plan,”

which “may allocate to a tax-qualified employee benefit plan nontransferable subscription rights

to purchase up to 10% of the capital stock of the converted stock company or the stock of

another corporation that is participating in the conversion plan[.]” Id., § 5/59.7(b). This plan is

permitted “to exercise its subscription rights regardless of the amount of shares purchased by

other persons.” Id.

C. Members Mutual’s Stock Conversion Plan

43. On June 20, 2019, Vericity filed the Prospectus with the SEC. Afteward, on or

about July 31, 2019, the Board of Directors of Members Mutual approved the Plan to convert

from a mutual insurance holding company to a stock company. After completion of the Plan,

Members Mutual would become a wholly-owned subsidiary of Vericity.

44. To effectuate the Plan, Members Mutual offered for purchase between 14,875,000

shares and 20,125,000 shares of common stock at a purchase price of $10 per share.

45. These shares were offered through a subscription offering and a community

offering.

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46. The subscription offering was made to eligible Members Mutual members, who

were policyholders of Fidelity Life as of July 31, 2018, as well as to Members Mutual’s directors

and officers.

47. According to the Prospectus, “[c]oncurrently with the subscription offering and

subject to the prior right of subscribers in the subscription offering,” shares were offered in a

community offering “to eligible employees of Members Mutual and possibly to a limited number

of other potential investors.”

48. To complete the Plan, Vericity was required to meet two conditions: (1) a

minimum of 14,875,000 shares of common stock needed to be sold; and (2) the plan needed an

affirmative vote of at least two-thirds of the votes cast at a special meeting of the members.

49. The Vericity Defendants left nothing to chance. To ensure the Plan was realized,

Members Mutual, Vericity and Fidelity Life entered into the Stand-by Purchaser Agreement with

Apex Holdco, dated October 25, 2018 (amended and restated on March 26, 2019), under which

Apex Holdco agreed to act as the stand-by purchaser for this offering.

50. Importantly, Apex Holdco is an affiliate of J.C. Flowers IV L.P., a private equity

fund advised by J.C. Flowers & Co. LLC. A number of Vericity’s board members are also high

ranking employees of J.C. Flowers, including Defendant Rahe who is Vericity’s board chairman

and the managing director at Flowers, and Vericity director Dong, who too is a Vice President at

Flowers. Apex Holdco’s enrichment by virtue of a stock purchase and any dividend would

benefit not only Apex, but J.C. Flowers and its senior members including Rahe and Dong.

51. According to the Prospectus, “[i]f the number of shares subscribed for in the

subscription offering, (together with any subscriptions accepted in the community offering), is

less than 14,875,000 shares, and if all of the conditions to the stand-by purchaser’s purchase

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commitment have been satisfied, the stand-by purchaser will be obligated to purchase enough

shares to guarantee the sale of 14,875,000 shares in the offerings, and may purchase additional

shares as may be necessary in order to permit the stand-by purchaser to acquire a majority of the

shares sold, provided that no more than 20,125,000 shares may be sold in the offerings.”

52. The Prospectus thus all but guaranteed that Apex Holdco, as the stand-by

purchaser, would acquire the majority of shares in the offering and reap the benefits of majority

shareholder status, to the detriment of Members Mutual’s initial members.

53. The Prospectus further recognized that, under the terms of the agreement with

Apex Holdco, Apex Holdco “will have the right to designate a majority of the nominees to serve

on our board of directors, whether or not it acquires a majority of the stock sold in the offerings.”

54. If that were not enough, the Prospectus acknowledged that “the stand-by

purchaser will acquire a majority of our shares issued in the offerings if the number of shares

subscribed for in the subscription offering, together with any subscriptions accepted in the

community offering, total fewer than 7,437,500 shares.”

55. According to the Prospectus, if the stand-by purchaser acquired a majority of

Vericity’s shares, it “will be able to approve most corporate actions requiring stockholder

approval by written consent without a meeting of stockholders.”

56. According to the Prospectus, the directors and officers of Members Mutual

“indicated their intention to subscribe for approximately 2,123,675 shares, or approximately 14%

of the shares at the offering minimum.”

57. The Prospectus identified the proposed management purchases in the following

table:

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Name Amount ($)

Number of

Shares Minimum (%) Maximum (%)

Directors:

Linda Walker Bynoe $750,000 75,000 * *

Steven L. Groot 1,933,750 193,375 1.3 1.0

Richard A. Hemmings 1,933,750 193,375 1.3 1.0

James E. Hohmann 6,000,000 600,000 4.0 3.0

James W. Schacht 100,000 10,000 * *

John A. Fibiger 100,000 10,000 * *

Executive Officers (who are not also directors):

James C. Harkensee 3,123,750 312,375 2.1 1.6

Chris S. Kim 1,950,000 195,000 1.3 1.0

John Buchanan 700,000 70,000 * *

Laura R. Zimmerman 1,000,000 100,000 * *

Chris Campbell 1,000,000 100,000 * *

All Directors and Executive Officers as a Group

(11 persons) $18,591,250 1,859,125 12.5 9.2

All Directors and Officers as a Group (19 persons) $21,236,750 2,123,675 14.3 10.6

58. Vericity’s management team, directors and advisory board members also were

allowed to participate in an equity incentive plan whereby they would acquire an ownership

interest in the stand-by purchaser, Apex Holdco—thus reaping additional benefits not available

to Members Mutual’s members. According to the Prospectus, “under the plan, the general

partner of the stand-by purchaser may grant awards of Class B units to employees, directors and

other service providers of the stand-by purchaser and/or Vericity.” While these Class B units

“are non-voting profits interests in the stand-by purchaser that entitle the holders thereof to

participate in the appreciation in the value of the stand-by purchaser above an applicable

threshold and to thereby share in our future growth,” they do not similarly allow Plaintiff and the

Class to participate in the stand-by purchaser’s future growth.

59. Instead, with respect to Plaintiff and the Class, the Prospectus provided that “[t]he

minimum number of shares that a person may subscribe to purchase is 25 shares,” but the

“maximum number of shares that a person may subscribe to purchase in the subscription offering

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is the lesser of 743,750 or the individual maximum purchase limitations described in this

prospectus.”

60. Members Mutual’s Board of Directors announced that a special meeting of the

eligible members of Members Mutual would be held on August 6, 2019, to vote on the Plan. To

become effective, it required approval by the affirmative vote of at least two-thirds of the votes

cast at the special meeting.

D. The Demutualization of Members Mutual is Realized

61. According to a Form 8-K Vericity filed with the SEC on August 9, 2019, a total

of 20,125,000 shares were offered. But the shares were not allocated to eligible members through

a fair and equitable formula. Plaintiff and the Class’ shares were capped at 3,501,648. The

Board of Directors meanwhile got 2,123,675 million shares. As a result, the Stand-by Purchaser

Agreement was triggered giving Apex 11,373,352 shares (out of 14,875,000) or 76.5% of the

company.

62. The following chart depicts the structure of Vericity after the conversion:

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63. After the closing of the IPO, Apex Holdco established the Apex Holdco L.P.

Equity Incentive Plan, thus reserving Class B units representing 20.6% of the fully diluted units

of Apex Holdco for issuance to employees, directors, advisory board members and other service

providers of Vericity. The August 9, 2019 Form 8-K noted that these Class B units, while nonvoting interests, “entitle[d] holders thereof to participate in the appreciation in the value of the

Stand-by Purchaser, as represented by its ownership of the Company’s common stock, above a

$10 per share threshold[.]” The former members of Members Mutual—Plaintiff and the Class—

were not afforded any Class B units or other equity in Apex Holdco.

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E. The Stock Conversion Plan Unlawfully Constrained Members

of Members Mutual

64. The Prospectus contained a section entitled, “Limits on Your Purchase of

Common Stock,” which was specifically addressed to members, including Plaintiff and the

Class. This section provided that the Stock Conversion Plan and Illinois law established the

maximum purchase limits.

65. The Prospectus provided that the allocated subscription rights to purchase shares

were mailed to each eligible member and that “[n]o eligible member may subscribe to purchase

more shares than the number of subscription rights allocated to such member.” The Company

noted that this maximum purchase right was determined through actuarial analyses conducted by

Milliman, Inc., a third-party actuarial consulting firm.

66. Illinois law limits the amount of stock any shareholder or group of shareholders

acting together may acquire through a public offering or subscription rights to 5% of the capital

stock for the converted company for the first five years after the conversion, unless prior

approval is received by the Insurance Director. Thus, the cap imposed by Illinois law would

have allowed eligible members to purchases up to 5% of Vericity’s outstanding shares or

between 743,750 and 1,006,250. 215 ILCS § 5/59.6(i).

67. Instead, however, rather than providing members with the right to purchase shares

up to Illinois’s statutory cap, eligible members were allocated a “Fixed Component” of 100

subscription rights regardless of the number of qualifying policies they owned and a “Variable

Component” determined by a purported actuarial formula that considered past and future

contributions to Fidelity Life’s surplus of all eligible members’ qualifying policies in force when

the Stock Conversion Plan was adopted.

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68. Upon information and belief, many, if not all, of the members were restricted to

far less than the 5% cap in favor of Apex Holdco. For example, Plaintiff was restricted to 124

shares as his maximum purchase allowance, even though he intended to purchase significantly

more shares and informed the company of his desire to do so.

69. Ultimately, the right of the stand-by purchaser to purchase up to the offering

maximum all but guaranteed that it would acquire the majority of shares in the offering and reap

the benefits of being the majority shareholder to the detriment of longstanding Members

Mutual’s members.

70. The Prospectus acknowledged that “the stand-by purchaser will acquire a majority

of our shares issued in the offerings if the number of shares subscribed for in the subscription

offering, together with any subscriptions accepted in the community offering, total fewer than

7,437,500 shares.” That was not a forecast, but the plan. At the time the Prospectus was drafted,

Vericity knew that the Stand-by Purchase Agreement would be triggered based on the predetermined allocations to Members Mutual’s members.

71. Among the Risk Factors identified in the Prospectus, Vericity stated that if the

stand-by purchaser acquired more than 50% of Vericity’s voting power—which it did—the

Company would avail itself of the “controlled company” exception to the NASDAQ rules so that

it would not have to comply with certain corporate governance requirements, including the

requirement that a majority of the board be independent directors, and that the compensation

committee, the nominating committee and corporate governance committee be composed of

entirely independent directors.

72. The Prospectus also recognized that Apex Holdco, as the stand-by purchaser,

would have the right to designate a majority of the members of Vericity’s board. Indeed,

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according to the Prospectus, if the stand-by purchaser acquired a majority of Vericity’s shares, it

“will be able to approve most corporate actions requiring stockholder approval by written

consent without a meeting of stockholders.”

73. As discussed above, Vericity’s management team, directors and advisory board

members also reaped additional benefits not available to Members Mutual’s members. Under

the terms of the amended and restated limited partnership agreement of the stand-by purchaser,

these insider shareholders are participating in an equity incentive plan that will allow them to

acquire an ownership interest in the stand-by purchaser.

F. The Limits Placed on Members Mutual’s Members Diverged from Other

Demutualizations

74. A demutualization is merely a change in the form of ownership where a member’s

interests are transformed into shareholdings, but the identity of the owners stays relatively the

same. By contrast, here, the original owners (Plaintiff and the Class) were largely displaced by

the stand-by purchaser who acquired 11,373,352, giving the stand-by purchaser over 76% of the

outstanding shares of Vericity common stock. By placing limits on the subscription rights of

Plaintiff and the Class, Defendants engineered a transaction that delivered more than 76% of

Vericity’s shares into the hands of one investor and leaving Plaintiff and the Class as minority

owners with significantly less than 25% of the outstanding shares, considering the remaining

shares were divided between Members Mutual’s members and its directors and officers.

75. When compared with other comparable demutualizations, the Vericity

demutualization resulted in unusually low ownership retained by members. For example, in the

Principal Mutual Demutualization, the members retained 69% ownership. Likewise, in the

Prudential Demutualization, its members retained over 78% of the shares, and in the MetLife

Demutualization, its members retained nearly 63%.

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G. Defendants’ Unlawful Conduct Denied the Class the Opportunity to

Participate in Vericity’s Stock Appreciation and Special Dividend

76. Plaintiff and each member of the Class he seeks to represent likewise received

only shares for each subscription right exercised, and were not allowed to purchase additional

shares beyond the artificial limits placed on each of them by the Vericity Defendants.

77. Plaintiff is typical of the former members of Members Mutual who would have

purchased additional shares of Vericity stock at $10 per share if the Vericity Defendants had not

capped what they could purchase.

78. On the first day the Vericity share price was published, August 15, 2019, its

closing price was $12.00. Thus, the stock value had already appreciated 20%, $2.00 over the

subscription rights price after initial trading.

79. The daily closing prices for Vericity stock from when data was first available

through November 29, 2019, were as follows:

Date Close

8/15/2019 $12

8/16/2019 $12

8/19/2019 $14.54

8/20/2019 $24

8/21/2019 $20.155

8/22/2019 $17.05

8/23/2019 $16.7

8/26/2019 $18

8/27/2019 $17.99

8/28/2019 $15.25

8/29/2019 $16.5

8/30/2019 $16

9/3/2019 $14.63

9/4/2019 $14.57

9/5/2019 $14.57

9/6/2019 $14.75

9/9/2019 $14.65

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9/10/2019 $14.71

9/11/2019 $14.685

9/12/2019 $15

9/13/2019 $15

9/16/2019 $14.6

9/17/2019 $14.5

9/18/2019 $13.5

9/19/2019 $13.05

9/20/2019 $13

9/23/2019 $13.25

9/24/2019 $13.25

9/25/2019 $13

9/26/2019 $12.7

9/27/2019 $13.4

9/30/2019 $14

10/1/2019 $14

10/2/2019 $14

10/3/2019 $14

10/4/2019 $14

10/7/2019 $14

10/8/2019 $14

10/9/2019 $14

10/10/2019 $14

10/11/2019 $13.117

10/14/2019 $13.216

10/15/2019 $13.216

10/16/2019 $13.216

10/17/2019 $13.216

10/18/2019 $13.15

10/21/2019 $13.5

10/22/2019 $13.32

10/23/2019 $13.32

10/24/2019 $13.16

10/25/2019 $13.17

10/28/2019 $13.25

10/29/2019 $13.19

10/30/2019 $13.19

10/31/2019 $13.19

11/1/2019 $13.19

11/4/2019 $13.19

11/5/2019 $13.19

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11/6/2019 $13.19

11/7/2019 $18.15

11/8/2019 $20.893

11/11/2019 $18.09

11/12/2019 $20.781

11/13/2019 $20.225

11/14/2019 $20.15

11/15/2019 $21.25

11/18/2019 $22.501

11/19/2019 $22.4

11/20/2019 $22.708

11/21/2019 $22

11/22/2019 $19.336

11/25/2019 $19.48

11/26/2019 $19.5

11/27/2019 $19.196

11/29/2019 $19.4

80. While all eligible members who exercised subscription rights and received stock

at the initial price of $10 per share received an appreciated asset when their share certificates

arrived, they were, however, excluded from participating in this price appreciation when the

Vericity Defendants limited the amount of shares each eligible member could purchase. Instead,

the stand-by purchaser, Apex Holdco, has reaped the benefits of this appreciation, and will

continue to do so.

81. Moreover, the members of Members Mutual who exercised subscription rights

will also be unfairly excluded from Vericity’s one-time cash distribution. On November 6, 2019,

Vericity filed a release on Form 8-K announcing a special one-time cash distribution of $6.25 per

share to common stock holders of record as of November 21, 2019, which was paid on

December 9, 2019.

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82. Since members of Members Mutual were restrained from purchasing additional

shares of Vericity common stock by the Vericity Defendants, these members will not enjoy the

cash distribution on each additional share each would have purchased.

V. CLASS ACTION ALLEGATIONS

83. Plaintiff brings this action under Rules 23(a), b(1) and (b)(3) of Federal Rules of

Civil Procedure on behalf of himself and a class (the “Class”) defined as:

All persons who were participating Members Mutual policyholders

and whose rights were contracted through the plan of

demutualization of Members Mutual. The transaction is described

by Defendants in materials consisting of, among other things, the

Prospectus on Form 424B, filed with the U.S. Securities and

Exchange Commission on June 20, 2019 (the “Prospectus”).

84. Plaintiff Rokowsky is a member of the Class he seeks to represent.

85. The members of the Class number in the thousands and are so numerous that

joinder of all Members is impracticable, as required by Fed. R. Civ. P. 23(a)(1). While the exact

number and identity of all Class members is unknown to Plaintiff at the present time, that

information is identifiable and will be ascertained from Defendants’ records through appropriate

discovery. With respect to members, the Prospectus provided that “[t]he minimum number of

shares that a person may subscribe to purchase is 25 shares,” but the “maximum number of

shares that a person may subscribe to purchase in the subscription offering is the lesser of

743,750 or the individual maximum purchase limitations described in [the] prospectus.”

Therefore, Plaintiff alleges that the Class certainly consists of tens of thousands, if not hundreds

of thousands, of persons.

86. There are questions of law or fact common to all members of the Class in

satisfaction of the requirements of Fed. R. Civ. P. 23(a)(2). Moreover, such common questions

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predominate over any questions affecting only individual members of the Class, as required by

Fed. R. Civ. P. 23(b)(3).

87. These common legal and factual questions derive from a common nucleus of

operative facts relating to and including, without limitation:

(a) whether the Stand-by Purchase Agreement with Apex Holdco was

improper;

(b) whether Defendants improperly limited the number of shares

members of Members Mutual could acquire through the

subscription offering in violation of Illinois law;

(c) whether the launch of the Vericity IPO was conducted to shift

control of Vericity from members of Members Mutual to the

Stand-by Purchaser (Apex Holdco);

(d) whether Vericity’s management, team, directors and advisory

board members improperly received benefits not available to other

shareholders through the terms of the amended and restated limited

partnership agreement of the stand-by purchaser, allowing them to

acquire an ownership interest in the stand-by purchaser;

(e) whether Defendants are liable to the members of the Class for the

damages they suffered by artificially limiting the number of shares

they could purchase under the terms of the Stock Conversion Plan;

(f) whether Defendants are liable to the members of the Class for the

damages they suffered when Vericity issued a special dividend

based on the number of shares owned by the shareholders of

Vericity;

(g) whether the Vericity Defendants were unjustly enriched by cost

savings derived from their misuse of the arbitrary limits placed on

Members Mutual’s members’ right to purchase shares to eliminate

hundreds if not thousands of Class members from the Vericity

shareholder population;

(h) whether Apex Holdco was unjustly enriched by its receiving the

lion’s share of stock issued by Vericity through the Stock

Conversion Plan;

(i) whether Vericity Defendants were unjustly enriched by way of the

cost savings in shareholder servicing costs that they enjoyed as the

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result of their scheme to improperly eliminate hundreds of

thousands of members from the Vericity shareholder population;

(j) whether the Vericity Defendants breached fiduciary duties they

owed to the members of the Class;

(k) whether the Vericity Defendants breached duties of reasonable

care they owed to the members of the Class; and

(l) whether the Vericity Defendants breached contractual obligations

they owed to the members of the Class.

88. As the lead Plaintiff, Rokowsky’s claims are typical of the claims of the Class he

seeks to represent, pursuant to Fed. R. Civ. P. 23(a)(3). There are no conflicts between

Rokowsky’s interests and the interests of the members of the Class as a whole.

89. Rokowsky will fairly and adequately protect and represent the interests of the

Class, as required by Fed. R. Civ. P. 23(a)(4). Rokowsky’s interests are not antagonistic to or in

conflict with the interests of any other member of the Class. Moreover, Rokowsky has retained

competent counsel experienced in class action litigation to represent the Class.

90. Defendants, and each of them, have acted on grounds generally applicable to the

Class as a whole thereby making the final injunctive relief or corresponding declaratory relief

sought in this Class Action Complaint appropriate with respect to the Class as a whole in

satisfaction of the requirements of Fed. R. Civ. P. 23(b)(2).

91. A class action is superior to other available methods for the fair and efficient

adjudication of this litigation, in satisfaction of the requirements of Fed. R. Civ. P. 23(b)(3),

since individual joinder of all members of the Class is impracticable. Because damages suffered

by individual class members of the Class are relatively small in comparison to the expense and

burden of prosecuting this litigation, class members of the Class cannot redress the wrongs done

to them on an individual basis. Even if the class members of the Class were able individually to

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prosecute their individual actions, it would be unduly burdensome on the courts to proceed with

thousands of individual cases. By contrast, the class action device presents far fewer

management difficulties and provides the benefits of unitary adjudication, economies of scale

and comprehensive supervision by a single court.

VI. CAUSES OF ACTION

COUNT I

VIOLATIONS OF THE ILLINOIS INSURANCE STATUTES

215 ILCS § 5/59.1, et seq.

(Against all Defendants)

92. Plaintiff re-alleges and incorporates by reference the allegations set forth above as

if the same were fully rewritten herein.

93. Under Illinois demutualization laws, Members Mutual was required to provide

eligible members with subscription rights without payment to purchase a portion of the capital

stock of the converted stock company or, alternatively, a corporation owned by the mutual

company for purposes of acquiring or holding all of the converted company’s stock or a stock

insurance company into which the mutual company would be merged. These subscription rights

were to be allocated to eligible members through a fair and equitable formula, which may take

into account how different classes of policies of the eligible members contributed to the mutual

company’s surplus.

94. The applicable Illinois statutes provide that if there is an undersubscription of

capital stock by eligible members exercising their subscription rights, those shares are to be sold

in a public offering. “If the number of shares of capital stock not subscribed by eligible members

is so small or the additional time or expense required for a public offering of those shares would

be otherwise unwarranted under the circumstances, the plan of conversion may provide for the

purchase of the unsubscribed shares by a private placement or other alternative method approved

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by the Director that is fair and equitable to the eligible members.” Similarly, if there is an

oversubscription, the conversion plan should provide fair and equitable means for the capital

stock.

95. The applicable Illinois statutes do provide a limit for such, but not one as

oppressive as that imposed by the Vericity Defendants. They provide that a stock conversion

plan can limit any one person or group of persons acting in concert from acquiring, “through

public offering or subscription rights, more than 5% of the capital stock of the converted stock

company for a period of 5 years from the effective date of the plan except with the approval of

the Director.” The cap imposed by Illinois law restricted eligible members to purchases of no

more than 5% of Vericity’s outstanding shares or between 743,750 and 1,006,250.

96. Rather than providing members with the right to purchase shares up to Illinois’s

statutory cap, eligible members were allocated a “Fixed Component” of 100 subscription rights

regardless of the number of qualifying policies they owned and a “Variable Component”

determined by an actuarial formula that considers past and future contributions to Fidelity Life’s

surplus of all eligible members’ qualifying policies in force when the Plan was adopted.

97. Upon information and belief, many, if not all, of the Class members were

restricted to far less than the 5% cap in favor of Apex Holdco.

98. Upon information and belief, the Stand-by Purchaser Agreement was an improper

contract between the parties, which illegally capped Plaintiff and the Class from acquiring more

shares of Vericity in the offering and shifted the control of Vericity to Apex Holdco.

99. The Prospectus recognized that Apex Holdco, as the stand-by purchaser, would

have the right to designate a majority of the members of Vericity’s board. Indeed, according to

the Prospectus, if the stand-by purchaser acquired a majority of Vericity’s shares, it “will be able

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to approve most corporate actions requiring stockholder approval by written consent without a

meeting of stockholders.”

100. As discussed above, Vericity’s management team, directors and advisory board

members also reaped additional benefits not available to Members Mutual’s members. Under

the terms of the amended and restated limited partnership agreement of the stand-by purchaser,

these insider shareholders are participating in an equity incentive plan that will allow them to

acquire an ownership interest in the stand-by purchaser.

101. Vericity is also liable to the same extent as Members Mutual and Fidelity Life for

the foregoing failures and violations of statutory obligations to the eligible members as the

successor in interest and parent of Members Mutual and Fidelity Life under common

management and control with Members Mutual and Fidelity Life.

102. As a direct and proximate result of each such statutory violation, the members of

the Class, including without limitation Plaintiff Rokowsky, have been damaged because they

were denied the ability to acquire more shares of Vericity’s stock and participate in its share

price appreciation and special one-time cash distribution.

103. The Vericity Defendants are jointly and severally liable for the foregoing

damages.

COUNT II

BREACH OF FIDUCIARY DUTY

(Against Vericity & Individual Director Defendants)

104. Plaintiff re-alleges and incorporates by reference the allegations set forth above as

if the same were fully rewritten herein.

105. The Vericity and Individual Director Defendants owed certain fiduciary duties to

Plaintiff and the other members of the Class, including without limitation the fiduciary duties of

due care, loyalty and good faith and fair dealing with respect to their membership interests, the

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demutualization transaction and the conversion of Members Mutual from a mutual insurance

company to a stock company.

106. A director's duty of loyalty mandates that the best interest of the corporation and

its shareholders takes precedence over any interest possessed by a director, officer or controlling

shareholder and not shared by the stockholders generally.

107. In setting an unfairly low number of subscription rights, and knowing that

members of the Class were willing and able to purchase more than this restricted amount of

shares, the Vericity Defendants have each breached their fiduciary duties owed to Plaintiff and

the members of the Class.

108. Furthermore, the Vericity Defendants have each breached their fiduciary duties

owed to Plaintiff and the members of the Class by placing their corporate interests in

streamlining the shareholder base and granting benefits to Vericity’s directors and officers

otherwise not available to the original members, in conflict with the best interests of their

members in receiving fair and equitable right to participate in Vericity.

109. As a direct and proximate result of the foregoing breaches of fiduciaries duties by

the Vericity Defendants, and each of them, the members of the Class, including without

limitation Plaintiff, have been damaged because they received less subscription rights and an

equally diminished right to participate in Vericity’s stock price appreciation and the special onetime cash distribution.

110. The foregoing breaches of fiduciary duties were committed intentionally, or with

reckless or callous indifference to the protected rights of the Class to receive fair, reasonable,

equitable and adequate subscription rights.

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111. The Vericity Defendants are jointly and severally liable for the foregoing

damages.

COUNT III

NEGLIGENCE

(Against Vericity & Individual Director Defendants)

112. Plaintiff re-alleges and incorporates by reference the allegations set forth above as

if the same were fully rewritten herein.

113. The Vericity and Individual Director Defendants assumed a duty toward Plaintiff

and the members of the Class, among others, or had the duty imposed upon them by Illinois law,

for making the final determination for allocating subscription rights to Members Mutual’s

members with respect to the Vericity offering that was fair, reasonable, equitable and adequate to

them.

114. The Vericity Defendants failed to exercise reasonable care in discharging their

duties to Plaintiff and the members of the Class by improperly restraining Members Mutual’s

members by improperly limiting each of them from purchasing additional shares of Vericity in

the offering. As a direct and proximate result of the foregoing breaches of duties by the Vericity

Defendants, and each of them, the members of the Class, including without limitation Plaintiff,

have been damaged because they received less subscription rights and an equally diminished

right to participate in Vericity’s stock price appreciation and the special one-time cash

distribution.

115. It was foreseeable to the Vericity Defendants that the unfair and unreasonable

limit on subscription rights to Members Mutual’s members would harm the members of the

Class who lost control of Vericity, were not able to participate in the appreciation of Vericity’s

surge in share price after the offering or fully participate in the special one-time cash distribution.

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116. The unfair and unreasonable limit of subscription rights directly and proximately

caused the members of the Class, including without limitation Plaintiff, to unfairly relinquish

control of Vericity, and restrict participation in the appreciation of Vericity’s surge in share price

after the offering and the special one-time cash distribution.

117. The Vericity Defendants are jointly and severally liable for the foregoing

damages.

COUNT IV

BREACH OF CONTRACT

(Against Vericity Defendants)

118. Plaintiff re-alleges and incorporates by reference the allegations set forth above as

if the same were fully rewritten herein.

119. The relationship between a member of a mutual insurance company and the

mutual insurance company itself is contractual in nature as the result of an express or implied

contract between them.

120. Under Illinois demutualization laws, Members Mutual was required to provide

eligible members with subscription rights without payment to purchase a portion of the capital

stock of the converted stock company or, alternatively, a corporation owned by the mutual

company for purposes of acquiring or holding all of the converted company’s stock or a stock

insurance company into which the mutual company would be merged. These subscription rights

are to be allocated to eligible members through a fair and equitable formula, which may take into

account how different classes of policies of the eligible members contributed to the mutual

company’s surplus.

121. The only limitations on subscription rights set by Illinois law restricts the amount

of stock any shareholder or group of shareholders acting together may acquire through a public

offering or subscription rights to 5% of the capital stock for the converted company for the first

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five years after the conversion, unless prior approval is received by the Insurance Director.

Thus, the cap imposed by Illinois law permitted eligible members to purchases up to 5% of

Vericity’s outstanding shares or between 743,750 and 1,006,250.

122. A mutual insurance company’s statutory and common law obligations to pay fair,

reasonable, equitable and adequate consideration to eligible members in exchange for their

respective membership interests in connection with a demutualization transaction arises from a

number of sources, including without limitation (i) the contractual relationship between member

and mutual insurance company, (ii) well-established business practices, (iii) prior course of

dealings between members and mutual insurance company and (iv) the settled expectations of

the parties. By operation of law, this obligation has been incorporated into the terms of the

express or implied contract between member and the mutual insurance company, regardless of

whether it is specifically stated as such therein.

123. The Vericity Defendants’ contractual obligation to pay fair compensation to the

eligible members in exchange for their respective membership interests also derives from the

Plan described above.

124. Thus, by virtue of the contracts with their members, Members Mutual and Fidelity

Life and their successor, Vericity, were contractually required to provide each member

subscription rights up to, at minimum, the statutory maximum before allowing the stand-by

purchaser to purchase any remaining shares upon demutualization. To the extent such

contractual obligations may not be specifically stated in any written contract into which the

Vericity Defendants entered, such contractual terms are implied by operation of law.

125. The Vericity Defendants have breached the contracts with the members of the

Class, including without limitation Plaintiff, by constraining their subscription rights and causing

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an equally diminished right to participate in Vericity’s stock price appreciation and the special

one-time cash distribution.

126. As a direct and proximate result of the Vericity Defendants’ breaches of contract,

the members of the Class, including without limitation Plaintiff, have been damaged because

they were forced to relinquish control of Vericity, and restricted from fully participating in the

appreciation of Vericity’s surge in share price after the offering and the special one-time cash

distribution.

127. The Vericity Defendants are jointly and severally liable for the foregoing

damages.

COUNT V

UNJUST ENRICHMENT

(All Defendants)

128. Plaintiff re-alleges and incorporates by reference the allegations set forth above as

if the same were fully rewritten herein.

129. The Vericity Defendants have been unjustly enriched by the cost savings in

shareholder servicing costs that they enjoyed as the result of their scheme to improperly

eliminate hundreds of thousands of members from the Vericity shareholder population.

130. Apex Holdco has been unjustly enriched to the extent that it was afforded the

right to purchase over 73% of Vericity’s outstanding common stock and now exercises control

over Vericity, enjoys the significant appreciation in its holdings in Vericity since the offering

was completed, and received a greater share of the special one-time cash distribution.

131. Defendants, and each of them respectively, should be required and ordered to

disgorge the full amounts by which each has been unjustly enriched, and such sums should be

returned to the members of the Class, including without limitation Plaintiff, all of whom have

been damaged as the direct and proximate result of such unjust enrichment.

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WHEREFORE, Plaintiff respectfully requests that this Honorable Court:

a. certify the proposed class, appoint Plaintiff as a class representative and appoint

Plaintiff’s counsel as class counsel;

b. issue a judgment that Defendants violated Illinois Insurance Statutes by illegally

capping Plaintiff and the Class members purchase rights as part of the initial stock offering;

c. issue a judgment that Vericity and the Individual Director Defendants breached

their duties to Plaintiff and the Class, which proximately caused them damages;

d. issue a judgment that Vericity and the Individual Director Defendants breached

their contractual agreements with Plaintiff and the Class, which caused them damages;

e. issue a judgment that Defendants were unjustly enriched as a result of their

actions related to the initial stock offering; and

f. award any other relief the Court deems reasonable and necessary.

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DEMAND FOR JURY TRIAL

Pursuant to Rule 38(b) of the Federal Rules of Civil Procedure, Plaintiff demands a jury

trial as to all issues triable by a jury.

Date: January 21, 2020 Respectfully submitted,

By: /Mark R. Miller

Edward A. Wallace

Mark R. Miller

WEXLER WALLACE, LLP

55 W Monroe St

Suite 3300

Chicago, IL 60603

(312) 346-2222

eaw@wexlerwallace.com

mrm@wexlerwallace.com

SALTZ MONGELUZZI

BARRETT & BENDESKY, P.C.

Simon B. Paris

Patrick Howard

Charles J. Kocher

1650 Market Street, 52nd Floor

Philadelphia, PA 19013

215.496.8282

215.496.0999 (fax)

Sparis@smbb.com

Phoward@smbb.com

Ckocher@smbb.com

ROGERS CASTOR

Lance Rogers

Daniel J. Mirarchi

26 E. Athens Ave.

Ardmore, PA 19003

610-649-1880

877-649-1880 (fax)

Lance@RogercCastor.com

Dan@RogersCastor.com

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GUSTAFSON GLUEK PLLC

Daniel E. Gustafson

Raina Borrelli

Canadian Pacific Plaza

120 South Sixth Street, Suite 2600

Minneapolis, MN 55402

(612) 333-8844

DGustafson@gustafsongluek.com

RBorrelli@gustafsongluek.com

BONI, ZACK & SNYDER LLC

Michael J. Boni

Joshua D. Snyder

15 St. Asaphs Road

Bala Cynwyd, PA 19004

(610) 822-0200

(610) 822-0206 (fax)

mboni@bonizack.com

jsnyder@bonizack.com

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