Contract analysis

1. Introduction and Purpose Calderwood & Harkness LLP ("C&H" or "the Firm") serves as defense counsel for the insured, Vantage Mobility Systems Corp. ("VMS" or "Vantage"), in the above-referenced matter. The undersigned, Renata Vasquez, is the Responsible Partner overseeing all aspects of the defense. Bernard Crawford is the Billing Partner responsible for invoice management and fee coordination. Both Ms. Vasquez and

2. Case Summary 2.1 Parties and Claims Plaintiff. Gloria Reyes is a former Production Associate (Trim Line B) who was employed at VMS's Fontana Plant, located at 11780 Cherry Avenue, Fontana, California 92337. Ms. Reyes was employed by VMS from approximately March 12, 2021 through January 19, 2025. During her tenure, she was assigned to the second shift, which runs from 2:00 PM to 10:30 PM. Her hourly wage at the tim

1. First Cause of Action — Meal Period Violations (Cal. Lab. Code §§ 226.7, 512): Plaintiff alleges that VMS maintained a policy and practice of failing to provide lawful, uninterrupted, off-duty meal periods of not less than 30 minutes for every five hours worked, and failed to pay premium wages of one additional hour of pay at each employee's regular rate of compensation for each workday on which a compliant meal p

2. Second Cause of Action — Rest Period Violations (Cal. Lab. Code § 226.7): Plaintiff alleges that VMS failed to authorize and permit compliant rest periods of not less than 10 minutes for every four hours worked, or major fraction thereof, and failed to pay the corresponding premium wages for each workday on which a compliant rest period was not authorized or permitted.

3. Third Cause of Action — Unpaid Wages (Cal. Lab. Code §§ 204, 1194): Plaintiff alleges that VMS's timekeeping rounding policy and automatic meal period deductions resulted in systematic underpayment of wages owed for time actually worked, including straight-time and overtime wages.

4. Fourth Cause of Action — Inaccurate Wage Statements (Cal. Lab. Code § 226): Plaintiff alleges that, as a consequence of the foregoing violations, VMS issued wage statements that failed to accurately reflect, among other things, total hours worked, gross wages earned, and applicable hourly rates, in violation of the detailed requirements of Section 226.

5. Fifth Cause of Action — Waiting Time Penalties (Cal. Lab. Code § 203): Plaintiff alleges that VMS willfully failed to pay all wages due upon termination or within 72 hours of resignation, thereby subjecting VMS to waiting time penalties of up to 30 days' wages for each affected former employee.

6. Sixth Cause of Action — Unfair Business Practices (Cal. Bus. & Prof. Code § 17200 et seq.): Plaintiff alleges that VMS's conduct constitutes unlawful, unfair, and/or fraudulent business practices under California's Unfair Competition Law, entitling the putative class to restitution and injunctive relief.

7. Seventh Cause of Action — PAGA Penalties (Cal. Lab. Code § 2698 et seq.): Plaintiff brings representative PAGA claims on behalf of the State of California seeking civil penalties of $100 per employee per pay period for the initial violation and $200 per employee per pay period for each subsequent violation. The PAGA notice was served on the California Labor and Workforce Development Agency ("LWDA") on May 22, 2025

3. Defense Team and Billing Rates C&H has assembled a defense team with deep experience in California wage-and-hour class action litigation, including class certification practice in state court and complex employment data analytics. The core engagement team and their current standard billing rates are as follows: Ms. Vasquez will serve as the Responsible Partner with overall supervisory authority over the defense. M

4. Summary Litigation Plan Set forth below is a phased summary litigation plan covering the anticipated course of the defense from the responsive pleading stage through trial, if necessary. Each phase includes a description of the contemplated work, the strategic objectives, and an estimated cost range. These estimates are based on current information and will be refined as the case develops. We will promptly advise

5. Self-Insured Retention Erosion and Cost Allocation As set forth in the Policy and confirmed in the Reservation of Rights letter, VMS's $500,000 SIR must erode before Ridgeway's obligation to fund defense costs attaches. We understand that the SIR erodes on a first-dollar basis as defense costs and loss are incurred. Based on the Phase 1 and early Phase 2 budget estimates, C&H anticipates that the SIR will be subst

6. Requests to Ridgeway National 6.1 Confirmation of Continued Defense Funding We respectfully request that Ridgeway provide written confirmation that it will continue to fund defense costs in the above-referenced matter under the terms of the Reservation of Rights letter dated August 18, 2025, subject to the requirement that the SIR erode before Ridgeway's payment obligation attaches and subject to the reservations

7. Monthly Reporting Commitment C&H commits to providing Ridgeway with comprehensive monthly status reports throughout the duration of this engagement. Each monthly report will include the following elements: • A narrative summary of all significant activities performed during the reporting period, including court appearances, discovery conducted or received, depositions taken or defended, motions filed or opposed, a

8. Enclosures For your convenience, enclosed with this letter please find copies of the following documents:

1. Complaint, Gloria Reyes, individually and on behalf of all others similarly situated, and on behalf of the State of California v. Vantage Mobility Systems Corp., Case No. CIVSB-2025-04781, filed August 1, 2025, Superior Court of California, County of San Bernardino;

2. Summons issued in connection with the above-captioned action;

3. Proof of Service dated August 12, 2025, confirming service of the Summons and Complaint on VMS via CT Agents, Inc. (Sacramento, California);

4. PAGA notice served on the California Labor and Workforce Development Agency, dated May 22, 2025, LWDA Case No. LWDA-CM-2025-831447; and

5. Calderwood & Harkness LLP's engagement letter with Vantage Mobility Systems Corp. (provided for reference regarding billing rates, staffing, and scope of engagement). Please advise if you require additional copies of any of the foregoing documents or if there are additional materials you would like us to provide.

9. Closing We respectfully request a prompt response regarding (i) continued defense funding under the terms of the Reservation of Rights letter, (ii) Ridgeway's litigation management guidelines, and (iii) any applicable cost pre-approval thresholds, so that we may structure our defense activities and billing in accordance with Ridgeway's requirements from the outset. As noted above, VMS's responsive pleading deadlin