EXHIBIT 10.1

 

Certain portions of this Exhibit have been omitted pursuant to a request for
confidential treatment. The non-public information has been filed separately
with the Securities and Exchange Commission pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934, as amended. The omitted portions of this
Exhibit are indicated by the following: [****].

 

AMENDMENT TO GENERAL AGENCY CONTRACT

 

This is an amendment to that certain General Agency Contract (the “Original
Contract”) between LIBERTY NATIONAL LIFE INSURANCE COMPANY (the “Company”) and
INDEPENDENT RESEARCH AGENCY FOR LIFE INSURANCE (“IRA”), effective October 1,
1981.

 

BACKGROUND AND DEFINITIONS

 

A. First Command Financial Services, Inc. (“First Command”) is the successor to
IRA under the Original Contract. References to IRA in the Original Contract will
be deemed references to First Command.

 

B. First Command has previously limited its sales activities to the military
market, but desires to expand its operations to include the civilian market. The
following definitions apply in this Amendment:

 

(i) “First Command Policy Series” means insurance policies issued to or on the
life of qualified military personnel, the spouse of qualified military
personnel, or children of qualified military personnel.

 

(ii) “First Command Civilian Policy Series” means all policies issued that are
not First Command Policy Series policies.

 

(iii) “All Policies” means both the First Command Policy Series and the First
Command Civilian Policy Series.

 

(iv) The First Command Policy Series and the First Command Civilian Policy
Series are those issued on the following policy forms, including all state
variations of the forms, and all riders and supplemental benefits issued in
conjunction with those policies.

 

Plan

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   Policy Form

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Whole Life

   [****]

Last Survivor Whole Life

   [****]

Decreasing Term without Cash Values

   [****]

Decreasing Term with Cash Values

   [****]

 

This change necessitates certain changes in the Original Contract. Therefore, in
consideration of the mutual covenants contained in this Amendment, it is agreed
as follows:

 

1. Paragraph 5 of the Original Contract is deleted and the following is
substituted:

 

5. COMMISSIONS. First Command shall be paid the following commissions on
premiums paid the Company for policies issued under this contract:

 

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(a) First Command Policy Series.

(i) First Year:

  150% of first year premium

(ii) Second through Tenth Years:

  Renewal Commission of 17.5% of premiums

(iii) Eleventh and Subsequent Years:

  Service fee of 10% of premiums

(b) First Command Civilian Policy Series.

(i) First Year:

  [****]% of first year premium

(ii) Second through Tenth Years:

  Renewal Commission of [****]% of premiums

(iii) Eleventh and Subsequent Years:

  Service fee of [****]% of premiums

 

[****].

 

(c) First Command will also be paid a sales development allowance (“Bonus”)
based upon [****], paid for during each First Command fiscal year, which begins
on October 1 and ends on September 30 of each year, in accordance with the
schedule and calculations set forth in Attachment 1 to this Amendment, beginning
as of October 1, 2004. [****].

 

(d) All commissions, renewal commissions, service fees, and other remuneration
payable to First Command under this contract shall be fully vested and upon
termination of this contract, the first year and renewal commissions and service
fees otherwise payable to First Command shall be continued until no First
Command business remains in force with the Company.

 

(e) The rate of commission for all benefit riders, issued as part of a life
insurance policy shall be determined by the rate of commission applicable to the
basic policy, except that no commissions shall be payable on premium deposits,
preliminary term policies, or waived premiums. No commissions shall be payable
on any other type of extra premiums whatsoever unless specifically agreed upon
in writing by the parties.

 

(f) The Company agrees to pay all commissions or other compensation earned by
First Command and its agents, both before and after termination of this
contract, to First Command, and to no other parties unless otherwise directed in
writing to do so by the Chief Executive Officer of First Command, or as required
by formal order or a governmental authority.

 

(g) Rates of commissions for plans and duration not included in the First
Command Policy Series or the First Command Civilian Policy Series, or on term
conversions or other policy changes shall be determined in each case by the
Company.

 

2. The Commission Loan Agreement attached to the Original Contract applies to
All Policies.

 

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3. In all other respects the Original Contract is unchanged. The parties ratify
the Original Contract, as amended by this Amendment. The term “this contract” as
used in the Original Contract, refers to the Original Contract, as modified by
this Amendment.

 

Executed as of the 1st day of January, 2005.

 

LIBERTY NATIONAL LIFE INSURANCE COMPANY

By:

 

/s/ Larry M. Hutchison

Name:

 

Larry M. Hutchison

Title:

  Executive Vice President and General Counsel FIRST COMMAND FINANCIAL SERVICES,
INC.

By:

 

/s/ Lamar C. Smith

Name:

 

Lamar C. Smith

Title:

 

Chief Executive Officer

 

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Attachment 1

 

FIRST COMMAND shall be paid a Sales Development Allowance (Bonus) based on
[****] during each FIRST COMMAND Fiscal Year, which begins on October 1st and
ends on September 30th of each year (Bonus Period) in accordance with the
following formula:

 

[****]:

 

[****]

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Minimum Amount of

Annualized
Premiums Issued
and Paid to

Company

--------------------------------------------------------------------------------

[****]

   $ 500,000

[****]

   $ 1,000,000     

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

[****]

   $ 1,500,000     

--------------------------------------------------------------------------------

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[****]