Exhibit 10.62
 
HEALTHMARKETS, INC.
Matching Agency Contribution Plan
(As Amended and Restated Effective April 5, 2006)
(“MAC”)
 

      Sponsoring Company   Participating Agencies
HealthMarkets, Inc.
  Cornerstone America,
9151 Boulevard 26
  a division of Mid-West National Life Insurance

North Richland Hills, Texas 76180
  Company of Tennessee
Central Park Office Tower
 
  2350 Airport Freeway
 
  Suite 100
 
  Bedford, Texas 76022
 
   
 
  Success Driven Awards, Inc.
 
  c/o HealthMarkets, Inc.
 
  9151 Boulevard 26
 
  North Richland Hills, Texas 76180

For Information Contact:
Ms. Karie Graves
500 Grapevine Highway
Suite 300
Hurst, Texas 76054
(817) 255-3839
Karie.Graves@hmamg.com
As Amended and Restated: April 5, 2006

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HEALTHMARKETS, INC.
Matching Agency Contribution Plan (MAC)
ARTICLE I.
DEFINITIONS
     The following capitalized terms shall have the respective meaning assigned
to them below. If not otherwise defined in this plan document, capitalized terms
shall have the meaning assigned to them in ACE.
     1.1. “ACE” means the HealthMarkets Agents’ Contribution to Equity Plan, as
amended and restated effective April 5, 2006.
     1.2. “Administrator” means HealthMarkets, or any person or persons
authorized by the Board of Directors of HealthMarkets (the “Board”) to
administer MAC.
     1.3. “Affiliates” means a wholly owned subsidiary of HealthMarkets.
     1.4. “Agent” means any independent insurance agent or independent field
services representative (“FSR”) who is contracted or associated with a
Participating Agency and who is not an employee of such Participating Agency.
     1.5. “Agent Plan Administrative Committee” shall have the meaning set forth
in Section 2.8 hereof.
     1.6. “ASAP” means the HealthMarkets Agents’ Stock Accumulation Plan, as
amended and restated as of April 5, 2006.
     1.7. “Board” shall mean the Board of Directors of HealthMarkets, as
constituted from time to time.
     1.8. “Bonus Credits” means Equivalent Shares which a Participating Agency
in its sole discretion may request the Administrator on behalf of the Sponsoring
Company to post to MAC Accounts of certain Participants, including but not
limited to any credits under ASAP or any other cash and wealth program of the
Sponsoring Company or any Participating Agency or Affiliate transferred to MAC.
     1.9. “Calendar Year” means the twelve (12) month period commencing on
January 1 and ending on December 31.
     1.10. “Contract” means “Independent Insurance Agent Commission-Only
Contract and/or FSR Agreement between the Participant and a Participating
Agency.”
     1.11. “Disability” means a Participant’s physical or mental disability to
be determined by reference to the effective Social Security guidelines.
     1.12. “Dividend Credits” means Equivalent Shares that the Administrator
posts to each Participant’s MAC Account in any month on behalf of the Sponsoring
Company pursuant to Section 4.5.

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     1.13. “Dynamic Equity Fund Plan” or “DEF Plan” means the equity program
maintained by HealthMarkets for the benefit of agents contracted with
Participating Agencies, which program collectively includes ASAP, ACE and MAC.
     1.14. “Effective Date” means April 5, 2006.
     1.15. “Equivalent Shares” means a book credit representing the number of
whole Shares which would have been purchased had MAC Credits been invested in
Shares on the date such credits were posted to each Participant’s MAC Account.
     1.16. “Fair Market Value” of a Share shall be determined as of each
Valuation Date or Special Dividend Valuation Date, as applicable, by the Board
in good faith. In determining “Fair Market Value,” the Board will consider
(among other factors it deems appropriate) the valuation prepared by The
Blackstone Group (“Blackstone”) in the ordinary course of business for reporting
to its advisory board and investors. Within not more than ten (10) business days
following each Valuation Date or Special Dividend Valuation Date, as applicable,
Blackstone will deliver to the Board its current valuation, and within not more
than five (5) business days thereafter the Board shall deliver to the Sponsoring
Company, the Administrator and each Participating Agency its determination of
Fair Market Value of a Share as of the immediately preceding Valuation Date or
Special Dividend Valuation Date, as applicable. References throughout this plan
document to the “current” or “then” Fair Market Value or the Fair Market Value
“as of” a particular date shall be deemed to mean, in each case, the Fair Market
Value of a Share as of the immediately preceding Valuation Date or Special
Dividend Valuation Date, as applicable. Notwithstanding the foregoing, if there
is a regular public trading market for such Shares, “Fair Market Value” shall
mean, as of any given date, the mean between the highest and lowest reported
sales prices of a Share during normal business hours on the New York Stock
Exchange Composite Tape or, if not listed on such exchange, on any other
national securities exchange on which the Shares are listed or on NASDAQ.
     1.17. “Forfeiture Credit Pools” means separate pools of Matching Credits,
Dividend Credits and/or certain Bonus Credits, in each case which are forfeited
under Article V by Participants in MAC who experience a Termination Date or a
Complete Withdrawal under Section 8.3(a) of ACE between July 1 of the prior Plan
Year and June 30 of the current Plan Year.
     1.18. “Forfeiture Credits” means Matching Credits, Dividend Credits and/or
certain Bonus Credits transferred by the Administrator from the Forfeiture
Credit Pools to the MAC Accounts of Participants who qualify under Section 4.4.
     1.19. “Founder’s Credits” means Equivalent Shares that the Administrator
posts to the MAC Accounts of Participants who qualify under Section 4.3.
     1.20. “HealthMarkets” means HealthMarkets, Inc. (formerly UICI), a Delaware
corporation.
     1.21. “MAC means this HealthMarkets Matching Agency Contribution Plan, as
amended and restated effective April 5, 2006.
     1.22. “MAC Account” means a separate book account of each Participant’s MAC
Equivalent Shares, as maintained by the Administrator.
     1.23. “MAC Credits” means Matching Credits, Bonus Credits, Forfeiture
Credits, Dividend Credits and Founder’s Credits that the Administrator posts to
Participants’ MAC Accounts, as set forth in Article IV.

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     1.24. “MAC Credit Addendum” means the addendum filed with the Administrator
by each Participating Agency, which sets forth the production requirements and
the Matching Percentage applicable to a Participating Agency’s participating
Agents. Such MAC Credit Addenda are incorporated by reference into this MAC plan
document.
     1.25. “MAC Payment” means the vested portion of the MAC Credits transferred
to a Participant’s ACE Account pursuant to Section 5.7.
     1.26. “Matching Credit” means Equivalent Shares that the Administrator
posts to each Participant’s MAC Account in any month on behalf of the Sponsoring
Company, pursuant to Section 4.1.
     1.27. “Matching Percentage” means the percentage designated from time to
time by each Participating Agency on an MAC Credit Addendum for purposes of
determining the Matching Credits to be posted pursuant to Section 4.1 to a
Participant’s MAC Account by the Administrator on behalf of the Sponsoring
Company; provided, however, that the Matching Percentage is established
initially at one hundred percent (100%).
     1.28. “Participant” means an Agent who is eligible to participate in MAC
pursuant to Section 3.1 of MAC.
     1.29. “Participating Agency” means any insurance agency, company, or other
organization, which, with the consent of the Sponsoring Company, adopts MAC.
     1.30. “Period of Ineligibility” means a period of twelve (12) consecutive
calendar months during which a person who was a Participant in MAC prior to the
commencement of such period is not eligible to participate in MAC due to such
Participant’s complete withdrawal from ACE under Section 8.3(a) of ACE.
     1.31. “Plan Year” means the Calendar Year.
     1.32. “Share” means a share of HealthMarkets’ Class A-2 common stock, $.01
par value per share.
     1.33. “Special Dividend” means any cash dividend declared and paid by the
Sponsoring Company with respect to Shares that has been so designated by the
Board as a Special Dividend for purposes of ACE.
     1.34. “Special Dividend Valuation Date” shall mean the date on which the
Board designates and declares a Special Dividend.
     1.35. “Sponsoring Company” shall mean HealthMarkets.
     1.36. “Termination Date” means the date on which the Participant’s
contractual relationship with a Participating Agency is terminated due to such
Participant’s Disability (as defined in Section 1.14) or such Participant’s
death, or the actual date on which the Participant otherwise ceases to be a
member of or contracted with a Participating Agency.
     1.37. “Valuation Date” shall mean each March 31, June 30, September 30 and
December 31 of each Plan Year.

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     1.38. “Years of Participation” means the number of consecutive full Plan
Years elapsed since the date the Participant became eligible and has filed with
the Administrator a properly completed Participant’s Election Form subsequent to
the end of such Participant’s most recent Period of Ineligibility, if any.
ARTICLE II.
GENERAL
     2.1. History and Purpose – HealthMarkets has established the following
plans for the benefit of agents contracted with Participating Agencies that sell
insurance policies and ancillary products issued by or reinsured by insurance
company subsidiaries of HealthMarkets and the FSRs that enroll members in
various membership associations:

  (a)   the HealthMarkets Agents’ Contribution to Equity Plan I (“ACE I”), as
amended and restated as of July 1, 2004;     (b)   the HealthMarkets Agents’
Contribution to Equity Plan II (“ACE II”), as adopted as of October 1, 2004;    
(c)   the HealthMarkets Matching Agency Contribution Plan I (“MAC I”), as
amended and restated as of July 1, 2004; and     (d)   the HealthMarkets
Matching Agency Contribution Plan II (“MAC II”), as adopted as of October 1,
2004.

Collectively, ACE I and ACE II are sometimes referred to herein as the “Agent
Contribution Plans”; MAC I and MAC II sometimes collectively referred to as the
“Agent Matching Plans”; and the Agent Contribution Plans and the Agent Matching
Plans, together with ASAP, are sometimes collectively referred to as the
“Dynamic Equity Fund Plans” or “DEF Plans”. The Sponsoring Company maintains the
DEF Plans to promote the mutual interests of HealthMarkets and its stockholders,
on the one hand, and the agents contracted with Participating Agencies that sell
insurance policies and ancillary products issued by or reinsured by insurance
company subsidiaries of HealthMarkets and the FSRs that enroll members in
various membership associations, on the other hand. Through the DEF Plans, the
Sponsoring Company seeks to provide a continuing incentive to such agents and
FSRs to sell such insurance policies and ancillary products and to enroll such
members, thereby providing HealthMarkets and its stockholders with the benefit
of having agents and FSRs whose performance is motivated through a closer
identity of interests with HealthMarkets’ stockholders.
     2.2. Amended and Restated Agent Matching Plans - As of the Effective Date,
(a) the Agent Matching Plans shall be consolidated as one plan and thereafter
referred to as the “HealthMarkets Agents’ Matching Total Ownership Plan,” or
“MAC”, (b) each of the Agent Matching Plans shall be and is hereby amended and
restated in its entirety as provided in this plan document, and (c) the Agent
Contribution Plans shall be consolidated as one plan and thereafter referred to
therein and herein as the “HealthMarkets Agents’ Total Ownership Plan,” or
“ACE”.
     2.3. Shares – As of the Effective Time (as defined in the Agreement and
Plan of Merger, dated as of September 15, 2005 (the “Merger Agreement”), among
the Sponsoring Company and certain entities formed by Blackstone, DLJ Merchant
Banking Partners IV, L.P. and Goldman, Sachs & Co.), each Matching Credit then
posted to a Participant’s MAC Account under any Agent Matching Plan shall
represent an equivalent book credit representing one Share (as defined in
Section 1.32 above) and shall

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thereafter constitute a Matching Credit in accordance with and subject to the
terms of MAC. The rights and obligations of the holders of each Share shall be
as set forth in the Certificate of Incorporation of HealthMarkets to be
effective as of the Effective Time (as defined in the Merger Agreement), the
terms of which are specifically incorporated herein by reference thereto.
     2.4. Non-Qualified Plan. - MAC is not intended to be a qualified plan under
Section 401(a) of the Internal Revenue Code of 1986 (the “Code”) or an employee
benefit plan under the Employee Retirement Income Security Act of 1974 (“ERISA”)
and is not subject to the vesting, funding, nondiscrimination, or other
requirements imposed on such plans by the Code and ERISA.
     2.5. Applicable Laws - MAC shall be construed and administered according to
the internal laws of the State of Texas.
     2.6. Gender And Number - Where the context requires, words in any gender
include the other gender, words in the singular include the plural, and words in
the plural include the singular.
     2.7. Evidence - Evidence required of anyone under MAC may include, but is
not limited to, valid certificates, affidavits, documents, or other information
considered pertinent and reliable by the Administrator.
     2.8. MAC Administration
     (a) Subject in all respects to the specific provisions hereof, the
Sponsoring Company hereby appoints the Administrator to manage the operation and
administration of MAC.
     (b) The Administrator shall appoint a committee (the “Agent Plan
Administrative Committee”), to consist of five persons, of which four persons
shall be members of management of the Company and one person shall be a
representative designated by The Blackstone Group (the “Blackstone Designee”).
The initial members of the Administrative Committee shall be William J. Gedwed,
Mark Hauptman, Bruce Madrid, Troy McQuagge and Matthew S. Kabaker (who shall
constitute the Blackstone Designee). Any vacancy occurring in the Agent Plan
Administrative Committee (by death or resignation or otherwise) may be filled by
the affirmative vote of a majority of the remaining members, provided, however,
that each such successor member of the Agent Plan Administrative Committee shall
be approved by The Blackstone Group.
     (c) The Agent Plan Administrative Committee shall act in an advisory
capacity to the Administrator and the Board in connection with the
administration of MAC. The Agent Plan Administrative Committee shall meet as, if
and when required under the terms of MAC, shall cause minutes of its proceedings
to be prepared and shall regularly report to the Board with respect to its
decisions and deliberations and otherwise upon the request of the Board. At all
meetings of the Agent Plan Administrative Committee, a majority of the members
(which for this purpose must include the Blackstone Designee) shall constitute a
quorum for the transaction of business, and the vote of a majority of the
members present at a meeting at which a quorum is in attendance shall be the act
of the Agent Plan Administrative Committee, in each case if and so long as
either the Board or the Blackstone Designee consents to the taking of such
action by the Agent Plan Administrative Committee.
     (d) Notice of meetings of the Agent Plan Administrative Committee shall be
made to each member within not less than two (2) business days prior to such
meeting, which notice shall be made either (i) in person, (ii) in writing,
(iii) by email, telecopy, or similar means, or (iv) by any other method
permitted by law. Any action which may be taken at a meeting of the Agent Plan
Administrative Committee may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall

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be signed by all of the members, and such consent shall have the same force and
effect as a unanimous vote of such members. The consent may be in one or more
counterparts so long as each member signs one of the counterparts. Members may
participate in and hold a meeting by means of a conference telephone or similar
communications equipment by means of which persons participating in the meeting
can hear each other.
     (e) The Company shall indemnify and hold harmless, to the full extent
permitted by law, each of the members of the Agent Plan Administration Committee
against any and all losses, claims, damages or liabilities, joint or several,
and expenses (including without limitation reasonable attorneys’ fees and any
and all reasonable expenses incurred investigating, preparing or defending
against any litigation, commenced or threatened, or any claim, and any and all
amounts paid in any settlement of any such claim or litigation) to which such
member may become subject, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) or expenses arise out
of or are based upon the such person’s activities as a member of the Agent Plan
Administration Committee. The provisions of this Section 2.8(e) are intended to
be for the benefit of, and shall be enforceable by, each member of the Agent
Plan Administration Committee and their respective successors, heirs and
representatives.
     (f) A designee of each of the GS Investor Group and the DLJ Investor Group
shall be entitled to notice of, to attend and to observe the proceedings of each
meeting of the Agent Plan Administrative Committee. For this purpose “DLJ
Investor Group” shall mean DLJ Merchant Banking Partners IV, L.P., DLJ Offshore
Partners IV, L.P., MBP IV Investors, L.P., CSFB Strategic Partners Holdings III,
L.P. and any Permitted Transferee (as such term is defined in that certain
Stockholders Agreement, dated as of April 5, 2006, between HealthMarkets and the
stockholders named therein (the “Stockholders Agreement”)) thereof, and “GS
Investor Group” shall mean Mulberry Holdings I, LLC and Mulberry Holdings II,
LLC and any Permitted Transferee (as such term is defined in the Stockholders
Agreement) thereof.
     2.9. Action By the Sponsoring Company, Administrator, the Agent Plan
Administrative Committee or Participating Agency - Any action required or
permitted to be taken by the Sponsoring Company, the Administrator, the Agent
Plan Administrative Committee or any Participating Agency under MAC shall be
taken by an officer duly authorized to take such action by the Board,
Administrator, the Agent Plan Administrative Committee or a Participating
Agency, as the case may be. If a Participating Agency is not a corporation, any
action required or permitted to be taken under MAC shall be by the individual or
individuals authorized to take such action on behalf of a Participating Agency,
as identified to Administrator. The Administrator shall have no duty to
investigate or confirm the validity of such identified individual’s authority to
act.
ARTICLE III.
PARTICIPATION
     3.1. Eligibility For Participation - Subject to the terms and conditions of
MAC, each Agent will become eligible for participation in MAC after completion
of one (1) full Calendar Year following the date the Agent entered into a
written Contract with a Participating Agency and has fulfilled all eligibility
requirements under ASAP or, in the case of a Complete Withdrawal by a
Participant pursuant to Section 8.3(a) of ACE, such Agent has completed the
Period of Ineligibility, provided that such Agent has properly completed a
Participant’s Election Form and such form has been received and acknowledged by
the Administrator.

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     3.2. Termination - The Participant shall become ineligible to participate
in MAC on his or her Termination Date.
     3.3. Participation Not Contract Of Employment - MAC does not constitute a
contract of employment, and participation in MAC will not give any Participant
the right to be retained in the service of a Participating Agency or
HealthMarkets either as an employee or an independent contractor, nor to any
right or claim to any benefit under MAC, unless such right or claim has
specifically accrued under the terms of MAC.
ARTICLE IV.
MAC CREDITS
     4.1. Matching Credit - For any given month, a Participant must meet the
production requirement set forth on the applicable MAC Credit Addendum and make
an ACE contribution to be eligible for the Matching Credit; provided, however,
that in no event shall the value of a monthly Matching Credit exceed $2,000 in
any given month. Each month the Administrator will post on behalf of a
Participating Agency a Matching Credit to the MAC Account of each Participant
eligible for such Matching Credit. Except as provided in the applicable MAC
Credit Addendum, the Matching Credit posted to each Participant’s MAC Account,
if any, shall equal the number of Shares purchased under ACE for that month with
the Participant’s ACE contribution, excluding any Enhancement Amounts (as that
term is defined in ACE), multiplied by the Matching Percentage. The posting date
of the Matching Credit will be the same day as the Participant’s Credit Date (as
that term is defined in ACE) for the Participant’s ACE contributions for the
month.
     4.2. Bonus Credits - A Participating Agency in its discretion (with the
approval of the Agent Plan Administrative Committee) may request the
Administrator from time to time to post Bonus Credits to all, or to a group
constituting of less than all, Participants’ MAC Accounts. Unless otherwise
directed by the Administrator and approved by the Agent Plan Administrative
Committee in any Plan Year and communicated to Participants, Bonus Credits
forfeited under Article V do not become a part of the Forfeiture Credit Pool.
     4.3. Founder’s Credits – Each MAC Participant shall have one Founder’s
Credit posted to his or her MAC Account for each Matching Credit that is so
posted during the twelve (12) months following the Effective Time. Founder’s
Credits shall be subject to the same terms and conditions as Matching Credits,
provided, however, that Founder’s Credits forfeited under Article V shall not
become a part of the Forfeiture Credit Pool.
     4.4. Allocation of Forfeiture Credits –
     (a) Subject to the special allocation provisions of subparagraph
(d) hereof, on June 30 of each Plan Year, the Administrator will determine and
post a Forfeiture Credit to each active Participant’s MAC Account from the
Forfeiture Credit Pool. Each Participant’s Forfeiture Credit shall be
determined, to the nearest whole Equivalent Share, by multiplying the Forfeiture
Credit Pool by a fraction, (i) the numerator of which is the total Matching
Credits which were posted to the Participant’s MAC Account for the period
beginning July 1 of the previous Plan Year and ending June 30 of the current
Plan Year (the “Calculation Period”) , and (ii) the denominator of which is the
aggregate of the Matching Credits posted to all active Participants’ MAC
Accounts for the Calculation Period; provided, however, that, for purposes of
calculating the numerator and the denominator of such fraction, the total number
of Matching Credits credited to any Participant’s MAC Account during such
Calculation Period shall be deemed not to exceed the amount of $15,000 divided
by the Fair Market Value of Shares as of the Valuation Date

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immediately preceding such June 30. For purposes of this Section 4.4, an active
Participant is a Participant who is under Contract with a Participating Agency
at June 30 of the current Plan Year.
     (b) If and to the extent that (i) the Administrator posts Bonus Credits
pursuant to Section 4.2 to MAC Accounts of a group of Participants constituting
less than all Participants’ MAC Accounts (such group of Participants herein
referred to as the “Participant Sub-Group”), (ii) the Participating Agency
determines in its discretion (with the approval of the Agent Plan Administrative
Committee) that, if forfeited, such Bonus Credits shall become a part of the
Forfeiture Credit Pool, and Participants in the Participant Sub-Group are so
notified at the time such Bonus Credits (“Designated Bonus Credits”) are
initially granted, then in such event a Participating Agency may direct the
Administrator to post the forfeited Designated Bonus Credits to the MAC Accounts
of the active Participants in the Participant Sub-Group. A Participant in the
Participant Sub-Group who has received the Designated Bonus Credits and is
active as of June 30 of the then current year will receive a portion of the
forfeited Designated Bonus Credits for the period of July 1 of the prior year to
June 30 of the current year determined, to the nearest whole Equivalent Share,
by multiplying the number of forfeited Designated Bonus Credits by a fraction,
(i) the numerator of which is the number of total Designated Bonus Credits which
were posted to the Participant’s MAC Account for the period beginning July 1 of
the previous Plan Year and ending June 30 of the current Plan Year (the
“Calculation Period”) and (ii) the denominator of which is the aggregate of the
Designated Bonus Credits posted to all active Participants’ MAC Accounts for the
Calculation Period; provided, however, that, for purposes of calculating the
numerator and the denominator of such fraction, the total number of Designated
Bonus Credits credited to any Participant’s MAC Account during such Calculation
Period shall be deemed not to exceed the amount of $15,000 divided by the Fair
Market Value of Shares as of the Valuation Date immediately preceding such
June 30.
     (c) If and to the extent that (i) the Administrator posts Dividend Credits
pursuant to Section 4.5 and (ii) the Participating Agency determines in its
discretion (with the approval of the Agent Plan Administrative Committee) that
such Dividend Credits, if forfeited, shall become a part of the Forfeiture
Credit Pool and Participants who initially received such Dividend Credits are so
notified at the time such Dividend Credits are granted, then in such event a
Participating Agency may direct the Administrator to post the forfeited Dividend
Credits to the MAC Accounts of the active Participants who initially received
such Dividend Credits. A Participant who has received the Dividend Credits while
a Participant in MAC and is active as of June 30 of the then current year will
receive a portion of the forfeited Dividend Credits for the period of July 1 of
the prior year to June 30 of the current year determined, to the nearest whole
Equivalent Share, by multiplying the number of forfeited Dividend Credits by a
fraction, (i) the numerator of which is the total Dividend Credits which were
posted to the Participant’s MAC Account for the period beginning July 1 of the
previous Plan Year and ending June 30 of the current Plan Year (the “Calculation
Period”), and (ii) the denominator of which is the aggregate of Dividend Credits
posted to all active Participants’ MAC Accounts for the same period; provided,
however, that, for purposes of calculating the numerator and the denominator of
such fraction, the total number of Dividend Credits credited to any
Participant’s MAC Account during such Calculation Period shall be deemed not to
exceed the amount of $15,000 divided by the Fair Market Value of Shares as of
the Valuation Date immediately preceding such June 30.
     (d) The following special allocation provisions shall be applicable
notwithstanding the foregoing provisions of subparagraph (a):

  1.   On the December 31 of the Calendar Year in which a Participant shall have
completed ten (10) Years of Participation in MAC, the Administrator shall
calculate the number of Forfeiture Credits to which such Participant would be
entitled if the allocation of the Forfeiture Credit Pool had been made on such
December 31 rather than on the succeeding June 30 as otherwise provided in
subparagraph (a) (such number of

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      Forfeiture Credits herein referred to as the “10-Year Frozen Credit
Amount”), and, on the June 30 subsequent to such December 31, in lieu of
allocation in accordance with subparagraph (a) hereof and if and so long as such
Participant is then active as of such June 30, the Administrator shall post to
such Participant’s MAC Account a number of Forfeiture Credits equal to the
10-Year Frozen Credit Amount.     2.   On the December 31 of the Calendar Year
in which a Participant shall have completed fifteen (15) Years of Participation
in MAC, the Administrator shall calculate the number of Forfeiture Credits to
which such Participant would be entitled if the allocation of the Forfeiture
Credit Pool had been made on such December 31 rather than on the succeeding
June 30 as otherwise provided in subparagraph (a) (such number of Forfeiture
Credits herein referred to as the “15-Year Frozen Credit Amount”), and on the
June 30 subsequent to such December 31, in lieu of allocation in accordance with
subparagraph (a) hereof and if and so long as such Participant is then active as
of such June 30, the Administrator shall post to such Participant’s MAC Account
a number of Forfeiture Credits equal to the 15-Year Frozen Credit Amount.     3.
  On the December 31 of the Calendar Year in which a Participant shall have
completed sixteen (16) Years of Participation in MAC, and on each December 31
thereafter, the Administrator shall calculate the number of Forfeiture Credits
to which such Participant would be entitled if the allocation of the Forfeiture
Credit Pool had been made on such December 31 rather than on the succeeding
June 30 as otherwise provided in subparagraph (a) (such number of Forfeiture
Credits herein referred to as the “16-Year Frozen Credit Amount”), and on the
June 30 subsequent to each such December 31 the Administrator, in lieu of
allocation in accordance with subparagraph (a) hereof and if and so long as such
Participant is then active as of such June 30, shall post to such Participant’s
MAC Account a number of Forfeiture Credits equal to the 16-Year Frozen Credit
Amount.

     4.5. Dividends; Dividend Credits - A book credit equal to amount of cash
dividends, if any, with respect to a Share, multiplied by the number of MAC
Credits in a Participant’s MAC Account, shall be credited to such Participant’s
MAC Account not later than and the 15th day of the third month after the close
of the Plan Year in which such dividends are received by the Administrator. Such
book credit shall be in the form of Equivalent Shares to the nearest whole Share
that could be purchased with such payment at Fair Market Value per Share
determined as of the immediately preceding Valuation Date or Special Dividend
Valuation Date, as applicable.
     4.6. Shares Subject to MAC - The Shares with respect to which awards may be
made under MAC shall be Shares currently authorized but unissued, Shares
currently held and/or Shares subsequently acquired by HealthMarkets or any
subsidiary of HealthMarkets, as treasury shares (including Shares purchased on
the open market or in private transactions). Subject to the provisions of this
Section 4.6, the number of Shares which may be delivered under MAC shall not
exceed 3,000,000 Shares in the aggregate. HealthMarkets will at all times
reserve and keep available a sufficient number of Shares to satisfy the
requirements of MAC. In the event that Equivalent Shares are forfeited pursuant
to the provisions of MAC, such Equivalent Shares shall again be available for
awards under MAC.

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ARTICLE V.
VESTING AND PAYMENT TO ACE
     5.1. Vesting - Subject to Section 5.2, 5.3, 5.4 and 5.5, a portion of a
Participant’s previously unvested MAC Account balance shall vest on each January
1 based on the Participant’s consecutive Years of Participation on that date in
accordance with the following schedule. For purposes of determining the vested
percentage of a Participant’s MAC Account balance, Years of Participation prior
to any Period of Ineligibility will not be counted. Except as set forth in
Section 5.4, a Participant’s Contract with a Participating Agency must be in
effect on December 31 of the prior Plan Year in order to proceed on the vesting
schedule on any January 1.

          VESTED PERCENTAGE OF PREVIOUSLY     UNVESTED COMPLETE YEARS OF   MAC
CREDITS PARTICIPATION   ON JANUARY 1 Less than 1   0% 1 but less than 5   15% 5
but less than 8   20% 8 but less than 9   25% 9 but less than 10   50% 10   100%

     5.2. Alternate Vesting Schedule for Certain Participants - If a Participant
has completed ten (10) consecutive years of vesting under MAC and has not had a
complete withdrawal under ACE and has not incurred a Period of Ineligibility
under ACE, then his or her MAC Account balance under MAC shall vest on each
January 1 based on the Participant’s consecutive Years of Participation on that
date in accordance with the following schedule. Except as set forth in
Section 5.4, a Participant’s Contract with a Participating Agency must be in
effect on December 31 of the prior Plan Year in order to proceed on the vesting
schedule on any January 1.

          VESTED PERCENTAGE OF PREVIOUSLY     UNVESTED COMPLETE YEARS OF   MAC
CREDITS PARTICIPATION   ON JANUARY 1 Less than 1   0% 1 but less than 2   20.00%
2 but less than 3   33.33% 3 but less than 4   45.46% 4 but less than 5   63.64%
5 or more   100.00%

     5.3. Alternate Vesting Schedule for Certain Participants Who Have completed
the Alternate Vesting Schedule in 5.2 – If a Participant has completed ten
(10) consecutive years of vesting under MAC and five (5) additional years of
vesting as outlined in Section 5.2 under MAC and has not had a complete
withdrawal under ACE, and has not incurred a Period of Ineligibility under ACE,
then his or her MAC Account balance under MAC shall vest one hundred percent
(100%) each January 1. Except as set forth in Section 5.4, a Participant’s
Contract with a Participating Agency must be in effect on December 31 of the
prior Plan Year in order to proceed on the vesting schedule on any January 1.
     5.4. Vesting on Termination due to Death or Disability - If a Participant
experiences a Termination Date due to death or Disability, the Participant’s MAC
Credits that have not vested as of such Termination Date will become one hundred
percent (100%) vested.

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     5.5. Discretionary Vesting Acceleration - Notwithstanding the foregoing,
the Sponsoring Company reserves the right in its discretion (with the approval
of the Agent Plan Administrative Committee) to modify and/or accelerate the
vesting schedule hereinabove set forth as to any individual Participant in MAC.
     5.6. Forfeitures - Subject to Section 5.4 and 5.5, if a Participant’s
contractual relationship with all Participating Agencies is terminated with or
without cause during the current Plan Year or if a Participant experiences a
complete withdrawal from ACE under Section 8.3(a) of ACE, then the nonvested
portion of his or her MAC Account shall be forfeited as of his or her
Termination Date. Forfeited Matching Credits and/or certain Bonus Credits and/or
Dividend Credits shall be accumulated into a Forfeiture Credit Pool to be
allocated and posted pursuant to Section 4.4.
     5.7. MAC Payment - As soon as administratively practicable after January 1
of each Plan Year, the Sponsoring Company will make an MAC Payment to the ACE
Account of each of its active Agents participating in MAC in an amount equal to
the newly vested MAC Credits under his or her MAC Account (to the nearest whole
Equivalent Share). The MAC Payment shall be made in the form of Shares or cash
equal to the amount necessary to purchase a number of Shares equal to the
Participant’s then vested MAC Credits. Shares acquired for purposes of the MAC
Payment may be newly issued Shares, Shares acquired by open market purchase
and/or Shares purchased from ACE Participants, as determined by the
Administrator in its sole discretion. At the time the MAC Payment is made to the
Participant’s ACE Account, the number of such vested MAC Credits will be
deducted from the Participant’s MAC Account. For purposes of this Section 5.7,
an active Agent participating in MAC is a Participant under contract with a
Participating Agency on December 31 of the prior Plan Year.
     5.8. Reduction of MAC Payment - In the event the Sponsoring Company, the
Administrator or a Participating Agency shall be held liable under the federal
securities laws, the securities laws of any state or otherwise to any
Participant for any loss incurred by such Participant’s ACE Account, then the
MAC Payment and any prior MAC Payment shall be reduced on a dollar-for-dollar
basis by the amount the Administrator on behalf of the Sponsoring Company
credits the Participant’s ACE Account in respect to such liability.
     5.9. Value of Vested MAC Credits –
     (a) The value of vested MAC Credits shall be determined as of the January 1
on which such MAC Credits vest by multiplying the number of MAC Credits then
vesting times the Fair Market Value per Share as determined as of the
immediately preceding Valuation Date.
     (b) The value of MAC Credits vesting upon the death of a Participant shall
be determined by multiplying the number of such MAC Credits then vesting by the
Fair Market Value per Share as determined as of the Valuation Date immediately
preceding the date of death.
     (c) The value of MAC Credits vesting upon the Disability of a Participant
shall be determined by multiplying the number of such MAC Credits then vesting
by the Fair Market Value per Share as determined as of the Valuation Date
immediately preceding the date the Plan Administrator receives notification of
Disability.

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ARTICLE VI.
AMENDMENT AND TERMINATION OF PLAN
     6.1. Amendment
     (a) Subject to Section 5.8, the Sponsoring Company through the
Administrator reserves the right to amend MAC at any time for any reason,
provided, however, that (a) no such amendment may (i) reduce a Participant’s MAC
Payment to an amount less than the amount the Participant would be entitled to
receive if he or she experienced a Termination Date with a Participating Agency
on the day immediately preceding the effective date of the Amendment and (b) any
proposed amendment to the Plan will be subject to approval of the shareholders
of HealthMarkets if such amendment would have the effect of (i) materially
increasing the benefits accruing to participants under the Plan, (ii) materially
increasing the aggregate number of securities that may be issued under the Plan
or (iii) materially modifying the requirements as to eligibility for
participation in the Plan.
     (b) Any Participating Agency may, with approval of the Sponsoring Company,
revise any part of its MAC Credit Addendum, including the stated Matching
Percentage, by filing an amended MAC Credit Addendum with the Administrator.
Amendments will become effective forty-five (45) days after notice of such
amendment is distributed to Participants in accordance with procedures
established by the Administrator, in its sole discretion, from time to time.
     6.2. Termination - While HealthMarkets expects and intends to continue MAC,
it reserves the right to terminate MAC at any time. MAC will terminate as to all
Participants on the first to occur of the following:

  (a)   the date MAC is terminated by HealthMarkets;     (b)   the date that
HealthMarkets is judicially declared bankrupt or insolvent; or     (c)   the
date of the dissolution, merger, consolidation, or reorganization of
HealthMarkets, or the sale of all or substantially all of HealthMarkets’ assets,
except that arrangements may be made whereby MAC will be continued by any
successor to HealthMarkets or any purchaser of substantially all of
HealthMarkets’ assets, in which case the successor or purchaser will be
substituted for HealthMarkets under MAC.

     6.3. Withdrawal of Participating Agency - A Participating Agency may
withdraw its participation in MAC, or the Sponsoring Company through the
Administrator may terminate any Participating Agency’s participation in MAC, in
each case by submitting written notification of such event to the other party at
least thirty (30) days prior to the effective date of such withdrawal or
termination of participation. In the event a Participating Agency notifies the
Administrator that it ceases to adopt MAC, or the Sponsoring Company through the
Administrator withdraws its consent to the adoption of MAC by a Participating
Agency, MAC shall terminate as to all Participants who are members of or
contracted with such Participating Agency, as of the effective date of either
such notice.
     6.4. MAC Payments on Termination - On termination of MAC in accordance with
Sections 6.2 or 6.3, vesting of MAC Credits will be at the sole discretion of
the Sponsoring Company. Each Participant’s final MAC Payment, if any, will be
made as soon as administratively practicable following the date of such
termination in accordance with Section 5.7. Subject to Section 5.8, no
termination may retroactively reduce MAC Credits previously transferred to a
Participant’s ACE Account.
     6.5. Notice of Amendment - The Administrator will notify affected
Participants of any material amendment or termination of MAC.
     6.6. Rights of Participants - Subject in all respects to the right of the
Sponsoring Company as provided in Section 6.1 hereof to amend MAC at any time
and the right of the Sponsoring Company to terminate MAC as provided in
Section 6.2 hereof at any time, it is agreed and hereby acknowledged that

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the obligations, if any, to maintain and fund MAC shall be and remain solely the
obligations of HealthMarkets in its capacity as Sponsoring Company and not the
obligations of any of HealthMarkets’ subsidiaries, and no Participant hereunder
shall have recourse to or other rights against any of HealthMarkets’
subsidiaries in connection with the funding or administration of MAC.
Notwithstanding the foregoing, the Sponsoring Company reserves the right to fund
and/or administer MAC through one or more of its subsidiaries.
     6.7. Prior Plan Agreements Superseded. The terms of MAC as herein set forth
shall supersede in all respects and be in complete substitution for all other
prior agreements and understandings with respect to the subject matter hereof,
including without limitation the terms of MAC I and MAC II.
     6.8. Certificate of Incorporation – For the purposes of clarity, each Share
transferred to a Participant’s ACE Account under MAC shall be subject to the
provisions of the Certificate of Incorporation, including any transfer, forced
sale, redemption and other restrictions set forth therein.

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HealthMarkets
Matching Agency Contribution Plan
MAC
MAC Credit Addendum

     
Participating Agency:
  Cornerstone America,
 
  a division of Mid-West National Life Insurance Company of Tennessee
 
  Central Park Office Tower
 
  2350 Airport Freeway
 
  Suite 100
 
  Bedford, Texas 76022
 
   
 
  Success Driven Awards, Inc.
 
  c/o HealthMarkets, Inc.
 
  9151 Boulevard 26
 
  North Richland Hills, Texas 76180

I.   MATCHING PERCENTAGE - Subject to the following provisions and Article IV of
the MAC plan document, the Matching Percentage is established at 100%.

II.   QUALIFYING PRODUCTION REQUIREMENT - Subject to the following provisions
and Article IV of the MAC plan document, each Participant will be eligible for a
Matching Credit

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each month if he or she attains the following production requirements stated in
terms of qualified production credits (“QPCs”) of insurance policies and/or
ancillary products submitted during the immediately preceding three (3) month
period:

              Personal QPCs   Team QPCs
Writing Agents
  40,000 QPCs   N/A
District Sales Leader
  40,000 QPCs   160,000 QPCs
Divisional Sales Leader
  40,000 QPCs   360,000 QPCs
Regional Sales Leader
  40,000 QPCs   2,500,000 QPCs

     This Addendum is effective as of April 5, 2006.

                  HealthMarkets, Inc.    
 
           
 
  By:        
 
  Name:  
 
   
 
  Its:  
 
   
 
     
 
   
 
                Cornerstone America, a division of         Mid-West National
Life Insurance Company of         Tennessee    
 
           
 
  By:        
 
  Name:  
 
   
 
  Its:  
 
   
 
     
 
   
 
                Success Driven Awards, Inc.    
 
           
 
  By:        
 
  Name:  
 
   
 
  Its:  
 
   
 
     
 
   

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HealthMarkets, Inc.
Matching Agency Contribution Plan
(“MAC”)
First Amendment
               This First Amendment (the “First Amendment”) amends that certain
HealthMarkets, Inc. Matching Agency Contribution Plan as amended and restated
effective April 5, 2006 (“MAC”) as and solely to the extent expressly set forth
herein. Except as otherwise expressly stated in this First Amendment, all
capitalized terms used herein shall have the meanings assigned to those terms
under MAC.
               1. Pursuant to Section 6.1(a) of MAC, HealthMarkets, Inc. (the
“Company”) hereby amends Section 1.16 of MAC by deleting Section 1.16 in its
entirety and inserting in lieu thereof and in substitution therefor the
following:
“Fair Market Value” of a Share shall be determined as of each Valuation Date or
Special Dividend Valuation Date, as applicable, by the Board in good faith. In
determining “Fair Market Value,” the Board will consider (among other factors it
deems appropriate) the valuation prepared by The Blackstone Group (“Blackstone”)
in the ordinary course of business for reporting to its advisory board and
investors. Within not more than ten (10) business days following each Valuation
Date or Special Dividend Valuation Date, as applicable, within not more than
eighty-five (85) business days following the Valuation Date coinciding with
December 31, 2006, and within not more than forty (40) business days following
the Valuation Date coinciding with December 31 of each Plan Year thereafter,
Blackstone will deliver to the Board its current valuation, and within not more
than five (5) business days thereafter the Board shall deliver to the Sponsoring
Company, the Administrator and each Participating Agency its determination of
Fair Market Value of a Share as of the immediately preceding Valuation Date or
Special Dividend Valuation Date, as applicable. References throughout this plan
document to the “current” or “then” Fair Market Value or the Fair Market Value
“as of” a particular date shall be deemed to mean, in each case, the Fair Market
Value of a Share as of the immediately preceding Valuation Date or Special
Dividend Valuation Date, as applicable. Notwithstanding the foregoing, if there
is a regular public trading market for such Shares, “Fair Market Value” shall
mean, as of any given date, the mean between the highest and lowest reported
sales prices of a Share during normal business hours on the New York Stock
Exchange Composite Tape or, if not listed on such exchange, on any other
national securities exchange on which the Shares are listed or on NASDAQ.
               2. The terms of MAC, as amended and supplemented hereby, are
confirmed in all respects and remain in full force and effect.
               3. This First Amendment is effective as of March 14, 2007.

                  HealthMarkets, Inc.    
 
           
 
  By:          
 
  Name:  
 
Peggy G. Simpson      
 
  Its:   Corporate Secretary    

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HealthMarkets, Inc.
Matching Agency Contribution Plan
(“MAC”)
Second Amendment
               This Second Amendment (this “Second Amendment”) amends that
certain HealthMarkets, Inc. Matching Agency Contribution Plan as amended and
restated effective April 5, 2006, as further amended by that certain First
Amendment to the HealthMarkets, Inc. Matching Agency Contribution Plan effective
March 14, 2007 (as amended, “MAC”) as and solely to the extent expressly set
forth herein. Except as otherwise expressly stated in this Second Amendment, all
capitalized terms used herein shall have the meanings assigned to those terms
under MAC.
               4. Pursuant to Section 6.1 of MAC, HealthMarkets, Inc. (the
“Company”) hereby amends Section 4.5 of MAC by deleting Section 4.5 in its
entirety and inserting in lieu thereof and in substitution therefor the
following:
“Dividends; Dividend Credits - A book credit equal to amount of cash dividends,
if any, with respect to a Share, multiplied by the number of MAC Credits in a
Participant’s MAC Account, shall be credited to such Participant’s MAC Account
promptly after such dividends are received by the Administrator. Such book
credit shall be in the form of Equivalent Shares to the nearest whole Share that
could be purchased with such payment at Fair Market Value per Share determined
as of the immediately preceding Valuation Date or Special Dividend Valuation
Date, as applicable.”
               5. The terms of MAC, as amended and supplemented hereby, are
confirmed in all respects and remain in full force and effect.
               6. This Second Amendment is effective as of May 3, 2007.

                  HealthMarkets, Inc.    
 
           
 
  By:          
 
  Name:  
 
Peggy G. Simpson      
 
  Its:   Corporate Secretary    

18