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ESCROW AGREEMENT

THIS  ESCROW AGREEMENT (the "Escrow Agreement") is made and entered into this
18th day of December, 2008, by and among SECURITY NATIONAL LIFE INSURANCE
COMPANY, a Utah corporation ("Security National"), SOUTHERN SECURITY LIFE
INSURANCE COMPANY, INC., a Mississippi corporation ("Southern Security"), the
SHAREHOLDERS OF SOUTHERN SECURITY LIFE INSURANCE COMPANY, INC.  that have
executed the Agreement by Shareholders of Southern Security Life Insurance
Company  to Sell Shares in Stock Purchase Transaction (the "Shareholders"), and
MACKEY PRICE THOMPSON & OSTLER, a Utah professional corporation (the "Escrow
Agent") (each of the foregoing parties is referred to singly, as  a "Party" and
collectively, as the "Parties").  Capitalized terms appearing in the Escrow
Agreement but not otherwise defined herein shall have the same meanings assigned
to them in the Stock Purchase Agreement.

WITNESSETH:

WHEREAS, on August 13, 2008, Security National, Southern Security, and the
Shareholders entered into a stock purchase agreement (the "Stock Purchase
Agreement") in which the Shareholders agreed to sell to Security National, and
Security National agreed to purchase from the Shareholders, all of the issued
and outstanding shares of stock of Southern Security in consideration for
purchase consideration payable to the Shareholders, as defined in Section 1.2 of
the Stock Purchase Agreement, on a pro rata basis in an amount to include the
following:  (i) the Capital and Surplus of Southern Security as of the date that
Security National assumed administrative control over Southern Security, which
was on September 1, 2008, (ii) plus the interest maintenance reserve and the
asset valuation reserve of Southern Security, as if the administrative control
date of September 1, 2008, (iii)  plus an allowance not to exceed $100,000 for
actual losses experienced by Southern Security in the second quarter ended June
30, 2008, which allowance shall not exceed $100,000 even if the actual losses
experienced by Southern Security in the second quarter ended June 30, 2008, or
any subsequent quarter are in excess of $100,000, (iv) less certain adjustments
(the "Purchase Consideration"); and

WHEREAS, Security National, Southern Security and the Shareholders desire to
establish this escrow for the purpose of holding the funds to be deposited into
an interest bearing escrow account (the "Escrow Account") in accordance with
amended terms of the Stock Purchase Agreement and distributing such funds
pursuant to amended terms of such agreement; and

WHEREAS, Escrow Agent is willing to receive the funds contemplated by the
amended terms of the Stock Purchase Agreement and to hold and distribute the
same in accordance with the amended terms of such agreement; and

WHEREAS, in Section 1.2(c) of the Stock Purchase Agreement, the Shareholders
agree at the closing of the transaction, as defined in Section 2.1 of the Stock
Purchase Agreement (the “Closing”) to deposit $175,000 (the “Deposit Amount”) of
the Purchase Consideration into the Escrow Account with the Escrow Agent, which
amount is to be used to pay the amount of any adjustments in the Stock Purchase
Agreement, including any adjustments in Sections 1.2(c), (d) and (e) thereunder
(the "Adjustments"); and

 
 

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WHEREAS, in Section 1.2(d) of the Stock Purchase Agreement, the Shareholders
further agree at Closing to deposit $537,000 of the Purchase Consideration (the
"Real Estate Deposit Amount") into the interest bearing Escrow Account, which
amount represents approximately 50% of the total outstanding balances on the
promissory notes that Southern Security has entered into with Ray-Nowell Funeral
Home, Inc. and Wade Nowell Funeral Homes, Inc. (the “Notes”), which Notes are
secured by funeral home properties in Senatobia, Mississippi and Collins,
Mississippi, respectively, of which the Shareholders agree to grant to Security
National a security interest in the Real Estate Deposit Amount to secure payment
of their Notes.  Beginning on September 1, 2009, and continuing on the same date
of each year thereafter, the Escrow Agent is to release to the Shareholders on a
pro rata basis, as more fully described in Section 1.2(d) of the Stock Purchase
Agreement,  certain amounts equal to the combined principal reduction of the
Notes that has occurred during the preceding August 1 through July 31 period,
until such time as the Real Estate Deposit Amount, including any accrued
interest thereon, has been paid to the Shareholders; and

WHEREAS, the Escrow Agent agrees to make payments from the Deposit Amount and
the Real Estate Deposit Amount to the Shareholders on a pro rata basis pursuant
to the amended terms and conditions of Section 1.2(c) and 1.2(d) of the Stock
Purchase Agreement; and

WHEREAS, Security National, Southern Security and each of the Shareholders
desire to modify the terms of the Stock Purchase Agreement by entering into an
escrow agreement containing terms and conditions that amend certain terms and
conditions of the Stock Purchase Agreement, and to the extent such amended terms
and conditions of the escrow agreement are inconsistent with those in the Stock
Purchase Agreement, such amended terms and conditions shall be controlling and
shall constitute an amendment to the Stock Purchase Agreement;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

1.           Delivery of Documents into Escrow.  Security National and Southern
Security herewith deliver the following documents to Escrow Agent to be held and
disposed of by Escrow Agent strictly in accordance with the terms of this Escrow
Agreement:

(a)           A copy of the Stock Purchase Agreement and any amendments thereto.

(b)           A certified shareholders list of Southern Security dated the
Closing Date (the "Certified Shareholders List") with the names and addresses of
each of the Shareholders and the number of shares held by each of the
shareholders as of the Closing Date.

(c)           A copy of a statement of the Capital and Surplus of Southern
Security as of September 1, 2008.

(d)           A copy of the Note that Southern Security entered into.
 
 
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2.           Delivery of Cash into Escrow.  The Shareholders herewith deliver
cash in the form of immediately available U.S. Dollars by bank wire transfer
into the Escrow Agreement in the amount of Four Hundred Forty-three Thousand
Five Hundred Dollars ($443,500) to U.S. Bank, N.A., 170 South Main Street, 6th
Floor, Salt Lake City, Utah 84101; Attn:  David H. Green, Vice President.

3.           Investment of Escrow Funds.  Any funds held in the Escrow Account
shall be invested by the Escrow Agent, in the Escrow Agent's discretion in
accordance with terms and conditions set forth in Section 5 below, in an
interest bearing account held by the Escrow Agent.

4.           Distribution of Escrow Funds.

(a)          The Shareholders agree at closing to deposit $175,000 of the
Purchase Consideration into the interest bearing Escrow Account as the Deposit
Amount.  This amount shall be held for a period of six months from the Closing
Date (the “Holdback Period”) and used to pay the amount of any adjustments in
the Stock Purchase Agreement, including any adjustments described in Sections
1.2(c), (d) and (e) thereunder.  The amount of the adjustments shall be
determined during the Holdback Period.  At the end of the Holdback Period,
Security National shall provide written notice of the amount and a description
of the adjustments to be charged against the Deposit Amount to the Shareholders
and the Escrow Agent at the addresses specified in Section 7 below.  Not less
than ten (10) days after the notice has been provided to the Shareholders, the
Escrow Agent agrees to transfer the remaining amounts of the Deposit Amount,
following the payment of any such adjustments, into the Real Estate Deposit
Amount to be held and distributed in accordance with the terms of Section 4(b)
below;

(b)          The Shareholders further agree at Closing to deposit $268,500 of
the Purchase Consideration into the interest bearing Escrow Account as the Real
Estate Deposit Amount.  This amount represents approximately 50% of the total
outstanding balance on the promissory note that Southern Security has entered
into with Wade Nowell Funeral Homes, Inc. (the “Note”), which Note is secured by
a funeral home property in Collins, Mississippi.  The Real Estate Deposit Amount
shall be increased by the amount of funds transferred from the Deposit Amount
(following payment of any adjustments) after the Holdback Period.  The
Shareholders agree to grant to Security National a security interest in the Real
Estate Deposit Amount to secure payment of the Note.  Except as set forth below,
beginning on September 1, 2009, and continuing on the same date of each year
thereafter, the Escrow Agent shall release to the Shareholders on a pro rata
basis an amount equal to the principal reduction of said Note that has occurred
during the preceding August 1 through July 31 period, until such time as the
Real Estate Deposit Amount (including any funds transferred from the Deposit
Amount), and any accrued interest thereon, have been paid to the
Shareholders.  Such payments shall be made according to the requirements of
Section 4(d) below.  However, the Escrow Agreement shall make no payments to the
Shareholders from the Real Estate Deposit Amount if the Note is in default.  In
the event there is a default in the payment of the Note, Security National shall
have the right to receive payment from the Real Estate Deposit Amount for the
amount of such default or to foreclose on the Note pursuant to the terms
thereunder and shall be entitled to receive payment from the Real Estate Deposit
Amount in an amount equal to the full amount of any losses and expenses incurred
by Security National as a result of such default and the enforcement of its
rights pursuant thereto.  The Shareholders and Security National agree that the
Shareholders have the right, but not the obligation, to refinance the existing
debt on the Note;

 
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(c)          Security National agrees to guarantee the payment of interest at
the rate of four percent (4%) per annum on the funds transferred from the
Deposit Amount to the Real Estate Deposit Amount after the Holdback Period.  The
guaranteed four percent (4%) interest shall include the interest earned from the
interest bearing Escrow Account on the funds transferred from the Deposit
Amount.  As the annual payments are made to the Shareholders pursuant to Section
4(b) above in the amount equal to the principal reduction of the Note that has
accrued during the preceding August 1 through July 31 period, the amounts paid
to the Shareholders for such principal reduction shall be apportioned on a pro
rata basis to the amount of funds transferred from the Deposit Amount after the
Holdback Period and the amount of funds in the Real Estate Deposit Amount prior
to the receipt of such funds from the Deposit Amount.  Thus, the funds
transferred from the Deposit Amount after the Holdback Period to the Real Estate
Deposit Amount shall earn interest at the rate of four percent (4%) per annum
until such funds are distributed to the Shareholders by means of annual
principal reduction payments;

(d)          Upon the completion and satisfaction of the required distributions
set forth in Sections 4(b) above, the Escrow Agent shall distribute the
remaining funds in the Escrow Account to the Shareholders on a pro rata basis to
the number of shares of Southern Security common stock held by the Shareholders
on the Closing Date, as set forth on the Certified Shareholders List.  Such
payments to the Shareholders shall be in the form of cashier's checks payable to
the order of each of the Shareholders as named on the Certified Shareholders
List and delivered to the address specified in writing by each of the
Shareholders.

5.           Responsibility of the Escrow Agent.  The Escrow Agent accepts the
escrow arrangements set forth in this Escrow Agreement upon the terms and
conditions hereof and undertakes to act solely as depository for the escrow
funds, with no obligations to Security National, Southern Security, or the
Shareholders except as specifically set forth herein.  The Parties hereto agree
that the following terms and conditions shall govern and control with respect to
the rights, duties, liabilities and immunities of the Escrow Agent hereunder.

(a)          Until escrowed payments are distributed as provided herein, the
Escrow Agent shall maintain such funds in an interest bearing account, as
provided herein.

(b)          The duties and obligations of the Escrow Agent shall be determined
solely by the express provisions of this Escrow Agreement, and no implied
covenants, duties or obligations shall be read into this Escrow Agreement
against the Escrow Agent, nor shall it have, or be deemed to have, any duties or
responsibilities under the provisions of any other agreements between the other
Parties hereto.

(c)          The Escrow Agent shall not be liable for any error of judgment, or
any actions taken, or omitted by it in good faith, or mistake of fact or law, or
for anything it may do or refrain from doing in connection therewith, except its
own gross negligence or willful misconduct.

 
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(d)          The Escrow Agent may rely and shall be protected from acting in
good faith in reliance upon resolution, direction, certificate, statement,
approval, notice, court order, or other document, not only unto its due
execution and the validity and effectiveness of its provisions, but also as to
the truth of any information therein contained, which it in good faith believes
to be genuine and what purports to be.

(e)          The Escrow Agent may consult with counsel or other experts of its
own choice and any opinion of its own choice and any opinion of counsel or
written opinion of such other experts shall be full and complete authorization
and protection with respect to any action taken or omitted by the Escrow Agent
hereunder in good faith and in accordance with such opinion of counsel or
opinion of such other experts within the area of their respective expertise.

(f)           The Escrow Agent may execute any of its powers or responsibilities
hereunder and exercise any rights hereunder either directly or by or through its
agent or attorneys.

(g)          The Escrow Agent shall not be responsible for and shall not be
under a duty to examine into or pass upon, the validity, binding effect,
execution or sufficiency of this Escrow Agreement or of any agreement, amendment
or supplement hereto nor shall the Escrow Agent be accountable for the source of
the escrow funds.

(h)          Except as otherwise specifically provided herein, the Escrow Agent
may deal with Security National, its parent company or its affiliates, in the
same manner and to the same extent and with like effect as if it were not the
Escrow Agent hereunder.

(i)           If any controversy or dispute arises between the Parties hereto or
with any third party with respect to the subject matter of the escrow described
herein, the Escrow Agent shall not be required to determine the same or take any
action, but may await the settlement of any such controversy or dispute by final
appropriate legal proceedings or otherwise as the Escrow Agent may require, and
in such event the Escrow Agent shall not be liable for interest or damage,
except that the Escrow Agent shall not deliver the escrow funds in any manner
other than in accordance with Section 4 hereof.  In addition, the Escrow Agent
shall have the right to commence such interpleader or other legal proceedings or
actions, or take or withhold any other actions, as are reasonably necessary or
appropriate pending resolution of such controversy or dispute.  The Escrow Agent
shall be entitled to retain counsel to represent it in any controversy or
dispute relating to this Escrow Agreement.

6.           Termination.  This Escrow Agreement shall terminate upon
distribution of all of the funds in the Escrow Account pursuant to Section 4
hereof.

7.           Manner of Notice.  All notices required by this Escrow Agreement or
which one party desires to serve on another party, shall be in writing and shall
be deemed given or made when delivered to such party personally, or three days
after mailing to such party by bonded courier, by registered or certified mail,
postage prepaid, return receipt requested, or by first-class mail, postage
prepaid, to the addresses specified below:

 
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If to Security National, to:

     
Security National Life Insurance Company 
     
5300 South 360 West, Suite 250
     
Salt Lake City, Utah  84123
     
Attn:  Scott M. Quist, President
     
Facsimile No. (801) 264-1060
     
Telephone No.  (801) 265-9882

or to such other address or addresses as Security National shall hereinafter
designate by notice to the other parties as herein provided; and

If to Southern Security, to:

     
Southern Security Life Insurance Company, Inc.
     
211 Ball Drive
     
P.O. Box 924
     
Louisville, Mississippi 39339
     
Attn:  Russell C. Nowell, President
     
Facsimile No.:  (622) 779-4155
     
Telephone No.:  (622) 779-4113

or to such other address or addresses as Southern Security shall hereinafter
designate by notice to the other parties as herein provided;

If to Shareholders, to:

     
Shareholders of Southern Security Life Insurance Company
     
211 Ball Drive
     
P.O. Box 924
     
Louisville, Mississippi 39339
     
Facsimile No.:  (622) 779-4155
     
Telephone No.:  (622) 779-4113

or to such other address or addresses as the Shareholders shall hereinafter
designate by notice to the other parties as herein provided;

 
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With a copy to:

     
Julie M. McPeak, Esq.
     
Burr & Forman, LLP
     
700 Two American Center
     
3102 West End Avenue
     
Nashville, Tennessee 37207
     
Facsimile No.:  (615) 724-3290
     
Telephone No.:  (615) 724-3200

If to Escrow Agent, to:

     
Mackey Price Thompson & Ostler
     
57 West 200 South, Suite 350
     
Salt Lake City, Utah 84101
     
Attn:  Randall A. Mackey, Esq.
     
Facsimile No.:  (801) 575-5006
     
Telephone No.:  (801) 575-5000

or to such other address or addresses as the Escrow Agent shall hereinafter
designate by notice to the other parties as herein provided.

8.           Governing Law.  This Escrow Agreement shall be enforced and
construed in accordance with the laws of the State of Mississippi.

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

10.         Time.  Time is of the essence of this Escrow Agreement.

11.         Headings.  The subject headings of the paragraphs contained in this
Escrow Agreement are included for purposes of convenience only and shall not
control or affect the meaning, construction or interpretation of any of the
provisions of this Escrow Agreement.

12.          Assignment of Interest.  Each Shareholder has the right to
assign his respective share of escrowed funds.  Any such assignment shall be
completed by a written assignment containing the notarized signature of
the Shareholder.  The assignment shall contain the name and address of the
assignee. A duplicate original of the Assignment shall be delivered to the
Escrow Agent by certified mail, return receipt requested.  The Escrow Agent
shall have no liability for delivering the escrowed funds to an assignee as
directed by a Shareholder.

 
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IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement as of
the day and year first above written.

 
SECURITY NATIONAL LIFE INSURANCE COMPANY
                         
By:
/s/ Scott M. Quist
     
Scott M. Quist, President
                   
SOUTHERN SECURITY LIFE INSURANCE COMPANY, INC.
                 
By:
/s/ Russell C. Nowell
     
Its: President
           
THE SHAREHOLDERS:
                         
 /s/ Russell C. Nowell
   
Russell C. Nowell
                           
 /s/ Janet Nowell Massey
   
Janet Nowell Massey
           
Estate of Genece Nowell
                           
 /s/ Michael Pierce
   
Michael Pierce, Temporary Administrator
                           
 /s/ Harold B. Nowell, Sr.
   
Harold B. Nowell, Sr.
 

 
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H&R II, L.P., as Shareholder
                           
By:  H&R I, Inc. as Managing General Partner of
     
H&R II, L.P.
                             
By:
/s/ Harold B. Nowell, III
         
Harold B. Nowell, III, Individually,
         
President, and as Shareholder of H&R I, Inc.
                                           
By:
/s/ Russell C. Nowell
         
Russell C. Nowell, Individually, and as Shareholder
         
of H&R I, Inc.
                             
By:  H. Bernard Nowell, Jr. Irrevocable Trust, as
     
Limited Partner of H&R II, L.P.
                             
By:
/s/ Harold B. Nowell, III
         
Harold B. Nowell, III, as Trustee
               
THE ESCROW AGENT:
             
MACKEY PRICE THOMPSON & OSTLER
                                     
By: /s/ Randall A. Mackey                                       
   
      Randall A. Mackey, President
 

 

 
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