19.  The Plan was adopted by Associated’s Board on February 23, 2011, and approved  by the Company’s shareholders on May 4, 2011.    20.  The Plan provided for the granting of various stock awards to the Company's  officers, employees, and non-employee directors.    21.  Pursuant to Section 2 of the Plan, the Compensation Committee is responsible for  administering the Plan.   22.  The Plan provided that no individual participant could be granted awards during a  calendar year covering more 125,000 shares (the "Limit").     23.  Specifically, as stated in Section 3(d) of the Plan:  No participant may be granted Stock Options or other Awards under the Plan with  respect to an aggregate of more than 125,000 Shares (subject to adjustment as  provided in Section 3(C) hereof) during any calendar year; provided, however,  that in connection with the commencement of employment, a participant may be  granted Stock Options and Share Appreciation Rights with respect to an aggregate  of 100,000 Shares, which will not count against such annual limit. (Emphasis  added.)   24.  An “Award” is defined in Section 1 of the Plan and covers all possible awards  that may be granted under the Plan. Specifically, an “Award” is defined as “any award of Stock  Options, Share Appreciation Rights, Restricted Shares, Deferred Shares or Other Share-Based  Awards under the Plan.”   25.  As described immediately below, the Board violated the Limit in both 2012 and  2013.  6  The Awards to Friedman   26.  On February 2, 2012, the Compensation Committee (which at the time consisted  of defendants Delaney, Schoff, and Schwarz), granted Friedman an award of restricted shares  under the Plan.  As described in the Schedule 14A Proxy Statement filed by the Company with  the SEC on March 26, 2012 (the "2012 Proxy"), the award “consist[ed] of restricted shares  granted on February 2, 2012” and had a grant date fair value of $1,050,000. As indicated in a  Form 4 filed by Friedman with the SEC on the next day the award consisted of 63,714 shares.    27.  Additionally, as described in a Schedule 14A Proxy Statement filed by the  Company with the SEC on March 28, 2013 (the “2013 Proxy”), on February 15, 2012 the  Compensation Committee granted Friedman stock options to purchase 125,000 shares of  Associated common stock.   28.  Accordingly, during the 2012 calendar year, Friedman was granted stock awards  covering 188,714 shares under the Plan, 63,714 shares in excess of the Limit. These excess  shares are ultra vires and should be rescinded.   29.  On February 1, 2013, the Compensation Committee (which at the time consisted  of defendants Sanfilippo, Schoff, and Schwarz), granted Friedman an award of restricted shares  under the Plan.  As described in the 2013 Proxy, the award “consist[ed] of restricted shares  granted on February 1, 2013” and had a grant date fair value of $938,000. As indicated in a Form  4 filed by Friedman with the SEC on February 5, 2013, the award consisted of 57,370 shares.    30.  Additionally, as described in the 2014 Proxy, on February 1, 2013 the  Compensation Committee granted Friedman an award of restricted stock units covering 192,661  shares. Friedman filed a Form 4 noting the award on February 5, 2013.    7   31.  Accordingly, during the 2013 calendar year, Friedman was granted stock awards  covering 250,031 shares under the Plan, 125,031 shares in excess of the Limit. These excess  shares are ultra vires and should be rescinded.  The Defendants Intentionally Violated the Plan   32.  The Defendants intended to violate the Plan.  There were only two basic facts that  would have put the Defendants on notice of the violations: the existence of the 125,000 share  calendar year limit in the Plan and the size of the awards granted to Friedman.   Each of the  Defendants knew and/or were on notice of the 125,000 share calendar year limit in the Plan and  each of the Defendants knew and/or were on notice of the size of the awards granted to  Friedman.    33.  Specifically, the following facts lead to the conclusion that the Defendants were  aware of the existence of the Limit:  a. Defendants Delaney, Sanfilippo, Schoff, and Schwarz were members of the  Compensation Committee responsible for administering and overseeing the Plan  and thus certainly knew the terms of the very plan they were administering.  b. Defendants Friedman, Adams, Gibbons, and Milstein were on the Board that  adopted the Plan in February 2011.  Defendants Adams, Gibbons and Milstein  were also on the Board that adopted amendments to the Plan on February 25,  2014, including an amendment to the Limit.  Accordingly, it is reasonable for the  Court to infer that Friedman, Adams, Gibbons, and Milstein were aware of the  existence of the Limit.  c. Each of the Defendants are eligible to receive and have received awards under the  Plan as part of their annual compensation.    And the following facts lead to the conclusion that the Defendants were aware of the size of the  equity awards granted to Friedman:   a. Defendants Delaney, Sanfilippo, Schoff, and Schwarz were members of the  Compensation Committee that approved the grants to Friedman and thus certainly  knew the size of the awards they granted.   8  b. Moreover, the Compensation Committee reports its compensation decisions to the  full Board. As stated in the 2014 Proxy, "the [Compensation] Committee reports  to the Board with respect to the design and implementation of executive  compensation." The 2014 Proxy also state that the "Chairman of the  [Compensation] Committee is responsible for updating the Board of Directors on  all matters related to the executive compensation program."  c. The size of the awards made to Friedman were made in public filings with the  SEC, including Form 4s and proxy statements.  Accordingly, it is certainly  reasonable to infer that the full Board was aware of the size of the awards.  Finally, as described below, Defendants’ efforts to conceal their misconduct is further  evidence that Defendants were aware that they had violated the Plan.    Defendants Amend the Limit and File a False and Misleading Proxy    34.  On February 25, 2014, the Board adopted the Amended Plan.  The Amended Plan  had two major differences from the Plan.    35.  First, in the Amended Plan, the Board increased the number of shares available  for issuance by 2,700,000 shares.    36.  And second, the Board amended the Limit increasing it to 500,000 shares and  making it applicable only to stock options and share appreciation rights.  A redline of these  amendments appears below:  Annual Award Limit. No participant may be granted Stock Options or other  Awards Share Appreciation Rights under the Plan with respect to an aggregate of  more than 125,000 500,000 Shares (subject to adjustment as provided in Section  3(C) hereof) during any calendar year; provided, however, that in connection with  the commencement of employment, a participant may be granted Stock Options  and Share Appreciation Rights with respect to an aggregate of 100,000 Shares,  which will not count against such annual limit.    37.   In other words, while the Plan limited all stock awards that could be granted to  an individual participant during any calendar year at 125,000, the Amended Plan only limited the  amount of stock options and share appreciation rights that could be granted to an individual  participant during a calendar year and set that limit at 500,000. Under the Amended Plan, there  9  would be no annual limit on the number of restricted shares, deferred shares or other share-based  awards that could be granted to an individual participant during a calendar year.    38.  On March 28, 2014, the Board filed the 2014 Proxy in connection with the 2014  Annual Meeting, which was held on May 7, 2014.  In the 2014 Proxy via Proposal No. 2, the  Board solicited shareholder approval of the Amended Plan.  Additionally, via Proposal No. 1, the  Board solicited the re-election of each of the Company’s Board members.     39.  The Company’s shareholders approved the Amended Plan and re-elected each of  the Company’s Board members at the 2014 Annual Meeting.  However, the decisions made by  the Company’s shareholders were based on a materially false and misleading 2014 Proxy.   40.  First, the Board failed to disclose in the 2014 Proxy that the Compensation  Committee granted Friedman more shares than allowed under the Plan in each of the preceding  two years.  In considering whether to approve an equity compensation plan which would allow  the Compensation Committee to grant an additional 2.7 million shares, it was important for  shareholders to have known that the Compensation Committee granted more shares than allowed  under the Plan in each of the last two years.  Similarly, truthful and complete disclosure  regarding the Board’s repeated violations of the Plan is material information in determining  whether to re-elect each of the seven members of the Board, and especially the three members of  the Compensation Committee. Truthful and complete disclosure of this information is important  for shareholders in determining whether these directors can and will faithfully comply with their  fiduciary duties to the Company.     41.  Moreover, in the 2014 Proxy the Board actively concealed its past violations of  the Plan.  In describing the limit, the 2014 Proxy deceptively states: “Currently, the number of  stock options that can be granted to an executive is capped at 125,000 stock options per annum.”  10  Of course, if the Limit actually applied only to stock options, the Board would have been in  compliance with the Plan. However, the Board conveniently failed to disclose that the Limit  applied to all awards, and not just stock options.      42.  Additionally, in Proposal 2 the Board described the differences between the Plan  and the Amended Plan. As stated in the 2014 Proxy: "The details of the Restated Equity Plan are  consistent with the Equity Plan, approved by shareholders on May 4, 2011, except to increase the  shares available for future Awards by 2,700,000 shares, and increase the individual annual  Award limit of Stock Options and Share Appreciation Rights to 500,000." This is false. This  description of the annual limit leads shareholders believe that the Plan originally limited only  stock options and share appreciation rights and that the Amended Plan was simply increasing  that limit.  Of course, what the Board was really doing was removing the annual limit on  restricted shares, deferred shares or other share-based awards, the very limits they had previously  violated.    43.  The Board’s active attempt to conceal its past misconduct—first by amending the  Plan after the fact to alter the terms that it violated and then by omitting these changes from the  2013 Proxy’s discussion of the amendments—evidences the directors’ breaches of their duty of  loyalty.   44.  In conclusion, the 2014 Proxy was materially misleading and prevented  shareholders from casting an informed vote regarding Proposals 1 and 2 at the 2014 Annual  Meeting.  11  45.  Plaintiff brings this action derivatively on behalf of Associated to redress injuries  suffered, and yet to be suffered, by the Company as a direct and proximate result of Defendants’  misconduct.   46.  Plaintiff has owned Associated stock during the time of the wrongful course of  conduct alleged herein and continues to hold Associated stock.    47.  Plaintiff will adequately and fairly represent the interests of Associated in  enforcing and prosecuting its rights and has retained counsel competent and experienced in  shareholder derivative litigation.   48.  At the time of this filing the Board consists of the following seven directors:  Adams, Friedman, Gibbons, Milsten, Sanfilippo, Schoff, and Schwarz (the “Current Board”).  Each member of the Current Board was on the Board when the Plan was violated, and was on the  Board that filed the false and misleading 2014 Proxy, and each member has been named as a  defendant in this Action.   49.  Plaintiff did not make a demand on the Current Board prior to instituting this  Action. A pre-suit demand upon the Current Board is futile for several reasons.   50.  Defendants Sanfilippo, Schoff, and Schwarz were members of the Compensation  Committee that granted awards in violation of the Limit. Friedman accepted awards in violation  of the Limit and the remaining Current Board members allowed to the grants to occur despite  having knowledge of the Plan violations.  The Board’s actions, in approving, permitting, and/or  accepting awards in violation of the express, unambiguous terms of the Plan could not have been  a good faith exercise of business judgment, and accordingly demand is excused.  In addition, as a  result of their actions, each Current Board member faces a substantial likelihood of liability, and  12  therefore are incapable of considering a demand here. Accordingly, demand as to the Current  Board is excused.   51.  Moreover, the entire Current Board attempted to conceal its misconduct—first by  adopting the amendments to the Plan that altered the terms that were violated and then by filing a  proxy that concealed the nature of these amendments.  These actions by the Current Board are a  breach of Current Board’s duty of loyalty and accordingly demand is excused.    52.  In addition, Defendant Friedman is incapable of considering a demand in this  action because he is neither disinterested nor independent. Friedman received the awards  challenged herein, and thus has a strong financial incentive to maintain the status quo by not  authorizing any corrective action because it could force him to disgorge the improperly obtained  awards. Accordingly, Friedman is not disinterested. In addition, as CEO of the Company, and  with his principal source of income based on his role with the Company, Friedman is not  independent  53.  Plaintiff brings this action as a class action pursuant to Rule 23 of the Federal  Rules of Civil Procedure on behalf of owners of Associated common stock as of March 19, 2014  the record date for the determination of shareholders who were entitled to vote at the 2014  Annual Meeting (the “Class”). Excluded from the Class are Defendants and their affiliates,  immediate families, legal representatives, heirs, successors or assigns and any entity in which  Defendants have or had a controlling interest.    54.  The Class is so numerous that joinder of all members is impracticable. While the  exact number of Class members is unknown to Plaintiff at this time and can only be ascertained  through discovery, Plaintiff believes that there are thousands of members in the Class. According  13  to the 2014 Proxy, as of March 19, 2014, over 57 million shares of common stock were  represented by the Company as outstanding. All members of the Class may be identified from  records maintained by Associated or its transfer agent and may be notified of the pendency of  this action by mail, using forms of notice similar to that customarily used in securities class  actions.   55.  Questions of law and fact are common to the Class, including, inter alia, the  following:  a.  Have the Board members breached their fiduciary duties by filing the false and  misleading 2014 Proxy; and  b.  Whether Plaintiff and the other members of the Class were harmed by being  forced to vote at the 2014 Annual Meeting on the basis of the false and  misleading 2014 Proxy.   56.  Plaintiff’s claims are typical of the claims of the other members of the class and  Plaintiff has the same interests as the other members of the Class.    57.  Plaintiff is committed to prosecuting this action, will fairly and adequately protect  the interests of the Class, and has no interests contrary to or in conflict with those of the Class  that Plaintiff seeks to represent.  Accordingly, Plaintiff is an adequate representative of the Class  and will fairly and adequately protect the interests of the Class.   58.  A class action is a superior method for adjudication because the prosecution of  separate actions by individual members of the Class would create the risk of inconsistent or  varying adjudications for individual members of the Class and of establishing incompatible  standards of conduct for the party opposing the Class.  14   59.  Conflicting adjudications for individual members of the Class might as a practical  matter be dispositive of the interests of the other members not parties to the adjudications or  substantially impair or impede their ability to protect their interests.   60.  A class action is a superior method for adjudication because the cost of  prosecuting individual actions is prohibitive and the expense of adjudicating repetitious  individual claims in different courts would be an inefficient use of judicial resources.    61.  Concentrating the litigation of claims in this forum is desirable because the  Company is an Ohio corporation and the litigation involves issues of Ohio law.   62.  Defendants have acted on grounds generally applicable to the class, making a  class-wide adjudication a superior method of resolving the claims and making final injunctive  relief appropriate with respect to the Class as a whole.   63.  There are no issues requiring individualized resolution or the creation of sub- classes, thus class-wide adjudication will not present manageability concerns.  64.  Plaintiff incorporates by reference and realleges each and every allegation  contained above, as though fully set forth herein.   65.  As officers and/or directors of the Company, each of the Defendants owed the  Company and its shareholders fiduciary duties.    66.  In authorizing, approving, and/or by abdication of duty permitting the granting of  awards in violation of the terms of the Plan, the Defendants exceeded their authority under the  Plan, did not act in good faith toward the Company and thus breached their fiduciary duties  under Delaware law.  15   67.  These actions were not a good faith exercise of business judgment to protect and  promote the Company’s corporate interests, but rather lined the pockets of Friedman at the  expense and to the detriment of the Company.   68.  Defendants also breached their fiduciary duty of loyalty by intentionally violating  the Plan and then engaging in efforts to conceal their misconduct. These actions were not in the  Company’s best interest.   69.  Friedman breached his fiduciary duty to the Company by accepting grants in  violation of the Plan for his own personal benefit to the detriment and expense of the Company.   Accordingly, Friedman breached his fiduciary duties of loyalty and good faith.     70.  As a result of the Defendants’ actions, the Company has been and will be  damaged.   71.  Plaintiff and the Company have no adequate remedy at law.  72.  Plaintiff incorporates by reference and realleges each and every allegation  contained above, as though fully set forth herein.   73.  The Defendants have caused and will cause the Company to waste valuable  corporate assets by granting Friedman awards in excess of what was authorized under the Plan.    74.  By granting Friedman awards in excess of the amount allowed under the Plan in  2012 and 2013, the Defendants granted awards that no director of ordinary sound business  judgment would award, so as to constitute waste.    75.  As a result of this waste of corporate assets, the Defendants are liable to the  Company.  16  76.  Plaintiff repeats and realleges each and every allegation set forth above as if set  forth fully herein.   77.  Friedman received unauthorized personal financial benefits as a result of the  awards challenged herein.   78.  It would be unconscionable and against fundamental principles of justice, equity,  and good conscience for Friedman to retain the benefits of the awards that were granted in plain  violation of the Plan.   79.  Friedman has been unjustly enriched at the expense and to the detriment of the  Company.   80.  Accordingly, this Court should order Friedman to disgorge the shares awarded in  excess of the Limit.   81.  Plaintiff has no adequate remedy at law.  82.  Plaintiff incorporates by reference and realleges each and every allegation  contained above, as though fully set forth herein.   83.  The fiduciary duties of the Current Board require them to be completely truthful  with the Company’s shareholders and disclose all information material to the decisions that  confronted Associated shareholders at the 2014 Annual Meeting.  17   84.  As set forth above, the members of the Current Board have breached their  fiduciary duty by filing and seeking shareholder action on the basis of the materially false and  misleading 2014 Proxy.   85.  As a result, Plaintiff and Class members have been harmed as they were forced to  cast votes at the 2014 Annual Meeting based on a false and misleading proxy statement.   86.  Plaintiff and the Class have no adequate remedy at law.  Breach of Fiduciary Duty  (Against All Defendants)   Breach of Fiduciary Duty of Candor in Connection with the 2014 Proxy  (Direct Claim against the Current Board)   The Plan   Unjust Enrichment  (Against Friedman)   Waste of Corporate Assets  (Against the Defendants)  