Document:

exv4w3

Exhibit 4.3

 

HEALTHMARKETS, INC.

Agency Matching Total Ownership Plan

(As Amended and Restated Effective April 5, 2006)

(“AMTOP”)

 

	 	 	 
	Sponsoring Company	 	Participating Agencies
	HealthMarkets, Inc.

9151 Boulevard 26

North Richland Hills, Texas 76180

	 	UGA - Association Field

Services, a division of The MEGA

Life and Health Insurance Company 

500 Grapevine Highway, Suite 300

Hurst, Texas 76054
	 
	 	 
	 

	 	New United Agency, Inc.

500 Grapevine Highway, Suite 300

Hurst, Texas 76054
	 
	 	 
	 

	 	Performance Driven Awards, Inc.

500 Grapevine Highway, Suite 300

Hurst, Texas 76054

For Information Call:

Ms. Karie Graves

UGA- Association Field Services

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.

Agency Matching Total Ownership Plan (Amtop)

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 ATOP.

          1.1. “Administrator” means HealthMarkets, or any person or persons authorized by the Board of
Directors of HealthMarkets (the “Board”) to administer AMTOP.

          1.2. “Affiliates” means a wholly owned subsidiary of HealthMarkets.

          1.3. “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.

          1.4. “Agent Plan Administrative Committee” shall have the meaning set forth in Section 2.8
hereof.

          1.5. “AMTOP means this HealthMarkets Agency Matching Total Ownership Plan, as amended and
restated effective April 5, 2006.

          1.6. “AMTOP Account” means a separate book account of each Participant’s AMTOP Equivalent
Shares, as maintained by the Administrator.

          1.7. “AMTOP Credits” means Matching Credits, Bonus Credits, Forfeiture Credits, Dividend
Credits and Founder’s Credits that the Administrator posts to Participants’ AMTOP Accounts, as set
forth in Article IV.

          1.8. “AMTOP 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 AMTOP Credit Addenda are
incorporated by reference into this AMTOP plan document.

          1.9. “AMTOP Payment” means the vested portion of the AMTOP Credits transferred to a
Participant’s ATOP Account pursuant to Section 5.7.

          1.10.
“ATOP” means the HealthMarkets Agents’ Total Ownership Plan, as amended and restated
effective April 5, 2006.

          1.11. “Board” shall mean the Board of Directors of HealthMarkets, as constituted from time to
time.

          1.12. “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 AMTOP
Accounts of certain Participants, including but not limited to any credits under ITOP or any other
cash and wealth program of the Sponsoring Company or any Participating Agency or Affiliate
transferred to AMTOP.

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          1.13. “Calendar Year” means the twelve (12) month period commencing on January 1 and ending on
December 31.

          1.14. “Contract” means “Independent Insurance Agent Commission-Only Contract and/or FSR
Agreement between the Participant and a Participating Agency.”

          1.15. “Disability” means a Participant’s physical or mental disability to be determined by
reference to the effective Social Security guidelines.

          1.16. “Dividend Credits” means Equivalent Shares that the Administrator posts to each
Participant’s AMTOP Account in any month on behalf of the Sponsoring Company pursuant to Section
4.5.

          1.17. “Effective Date” means April 5, 2006.

          1.18. “Equivalent Shares” means a book credit representing the number of whole Shares which
would have been purchased had AMTOP Credits been invested in Shares on the date such credits were
posted to each Participant’s AMTOP Account.

          1.19. “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.

          1.20. “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
AMTOP who experience a Termination Date or a Complete Withdrawal under Section 8.3(a) of ATOP
between July 1 of the prior Plan Year and June 30 of the current Plan Year.

          1.21. “Forfeiture Credits” means Matching Credits, Dividend Credits and/or certain Bonus
Credits transferred by the Administrator from the Forfeiture Credit Pools to the AMTOP Accounts of
Participants who qualify under Section 4.4.

          1.22. “Founder’s Credits” means Equivalent Shares that the Administrator posts to the AMTOP
Accounts of Participants who qualify under Section 4.3.

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          1.23. “HealthMarkets” means HealthMarkets, Inc. (formerly UICI), a Delaware corporation.

          1.24. “ITOP” means the HealthMarkets Initial Total Ownership Plan, as amended and restated as
of April 5, 2006.

          1.25. “Matching Credit” means Equivalent Shares that the Administrator posts to each
Participant’s AMTOP Account in any month on behalf of the Sponsoring Company, pursuant to Section
4.1.

          1.26. “Matching Percentage” means the percentage designated from time to time by each
Participating Agency on an AMTOP Credit Addendum for purposes of determining the Matching Credits
to be posted pursuant to Section 4.1 to a Participant’s AMTOP Account by the Administrator on
behalf of the Sponsoring Company; provided, however, that the Matching Percentage is established
initially at one hundred percent (100%).

          1.27. “Participant” means an Agent who is eligible to participate in AMTOP pursuant to Section
3.1 of AMTOP.

          1.28. “Participating Agency” means any insurance agency, company, or other organization,
which, with the consent of the Sponsoring Company, adopts AMTOP.

          1.29. “Period of Ineligibility” means a period of twelve (12) consecutive calendar months
during which a person who was a Participant in AMTOP prior to the commencement of such period is
not eligible to participate in AMTOP due to such Participant’s complete withdrawal from ATOP under
Section 8.3(a) of ATOP.

          1.30. “Plan Year” means the Calendar Year.

          1.31. “Share” means a share of HealthMarkets’ Class A-2 common stock, $.01 par value per
share.

          1.32. “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 ATOP.

          1.33. “Special Dividend Valuation Date” shall mean the date on which the Board designates and
declares a Special Dividend.

          1.34. “Sponsoring Company” shall mean HealthMarkets.

          1.35. “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.

          1.36.
“Valuation Date” shall mean each March 31, June 30, September 30 and December 31 of each
Plan Year.

          1.37. “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.

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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’ Total Ownership Plan I (“ATOP I”), as amended and restated as
of July 1, 2004;
	 
	 	B.	 	the HealthMarkets Agents’ Total Ownership Plan II (“ATOP II”), as amended and restated
as of July 1, 2004’
	 
	 	C.	 	the HealthMarkets Agents’ Matching Total Ownership Plan I (“AMTOP I”), as amended and
restated as of July 1, 2004;
	 
	 	D.	 	the HealthMarkets Agents’ Matching Total Ownership Plan II (“AMTOP II”), as amended and
restated as of July 1, 2004;

Collectively, ATOP I and ATOP II are sometimes referred to herein as the “Agent Contribution
Plans”; AMTOP I and AMTOP II sometimes collectively referred to as the “Agent Matching Plans”; and
the Agent Contribution Plans and the Agent Matching Plans, together with ITOP, are sometimes
collectively referred to as the “TOP Plans.” The Sponsoring Company maintains the TOP 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 TOP 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 “AMTOP”, (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 “ATOP”.

          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 AMTOP Account under any Agent Matching Plan
shall represent an equivalent book credit representing one Share (as defined in Section 1.31 above)
and shall thereafter constitute a Matching Credit in accordance with and subject to the terms of
AMTOP. The rights and obligations of the holders of each Share shall be as set forth in the
Certificate of Incorporation

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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. - AMTOP 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 - AMTOP 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 AMTOP may include, but is not limited to,
valid certificates, affidavits, documents, or other information considered pertinent and reliable
by the Administrator.

          2.8. AMTOP 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 AMTOP.

          (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 AMTOP. The Agent Plan
Administrative Committee shall meet as, if and when required under the terms of AMTOP, 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 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

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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 AMTOP
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 AMTOP
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 AMTOP, each Agent
will become eligible for participation in AMTOP 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 ITOP eligibility requirements or, in the case of a Complete Withdrawal by a
Participant pursuant to Section 8.3(a) of ATOP, 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.

          3.2. Termination - The Participant shall become ineligible to participate in AMTOP on his or
her Termination Date.

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          3.3. Participation Not Contract Of Employment - AMTOP does not constitute a contract of
employment, and participation in AMTOP 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 AMTOP, unless such right or claim has
specifically accrued under the terms of AMTOP.

ARTICLE IV.

AMTOP CREDITS

          4.1. Matching Credit - For any given month, a Participant must meet the production requirement
set forth on the applicable AMTOP Credit Addendum and make an ATOP 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 AMTOP Account of each Participant eligible for such
Matching Credit. Except as provided in the applicable AMTOP Credit Addendum, the Matching Credit
posted to each Participant’s AMTOP Account, if any, shall equal the number of Shares purchased
under ATOP for that month with the Participant’s ATOP contribution, excluding any Enhancement
Amounts (as that term is defined in ATOP), 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 ATOP) for the Participant’s ATOP 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’ AMTOP 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 AMTOP Participant shall have one Founder’s Credit posted to his
or her AMTOP 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 AMTOP 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 AMTOP 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’ AMTOP 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 AMTOP 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. 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.

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          (b) If and to the extent that (i) the Administrator posts Bonus Credits pursuant to Section
4.2 to AMTOP Accounts of a group of Participants constituting less than all Participants’ AMTOP
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 AMTOP 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 total Designated Bonus Credits which were posted to the
Participant’s AMTOP 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’ AMTOP 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 AMTOP 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 AMTOP Accounts of the
active Participants who initially received such Dividend Credits. A Participant who has received
the Dividend Credits while a Participant in AMTOP 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 AMTOP 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’ AMTOP 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 AMTOP 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 AMTOP, 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 “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

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	 	 	 	June 30, the Administrator shall post to such Participant’s AMTOP 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 AMTOP, 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 AMTOP 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 AMTOP, 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 AMTOP 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 AMTOP Credits in a Participant’s AMTOP
Account, shall be credited to such Participant’s AMTOP 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 AMTOP - The Shares with respect to which awards may be made under AMTOP
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 AMTOP 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 AMTOP. In the event that Equivalent Shares are
forfeited pursuant to the provisions of AMTOP, such Equivalent Shares shall again be available for
awards under AMTOP.

ARTICLE V.

VESTING AND PAYMENT TO ATOP

          5.1. Vesting - Subject to Section 5.2, 5.3, 5.4 and 5.5, a portion of a Participant’s
previously unvested AMTOP 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 AMTOP Account balance, Years of
Participation

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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	 	AMTOP 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 AMTOP and has not had a complete withdrawal under ATOP and
has not incurred a Period of Ineligibility under ATOP, then his or her AMTOP Account balance under
AMTOP 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	 	AMTOP 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 AMTOP and five (5) additional years of vesting as outlined in Section 5.2 under AMTOP and has
not had a complete withdrawal under ATOP, and has not incurred a Period of Ineligibility under
ATOP, then his or her AMTOP Account balance under AMTOP 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 AMTOP Credits that have not vested
as of such Termination Date will become one hundred percent (100%) vested.

          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 AMTOP.

- 11 -

 

          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 ATOP under Section 8.3(a) of ATOP, then the
nonvested portion of his or her AMTOP 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. AMTOP Payment - As soon as administratively practicable after January 1 of each Plan
Year, the Sponsoring Company will make an AMTOP Payment to the ATOP Account of each of its active
Agents participating in AMTOP in an amount equal to the newly vested AMTOP Credits under his or her
AMTOP Account (to the nearest whole Equivalent Share). The AMTOP 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 AMTOP Credits. Shares acquired for purposes of the AMTOP Payment may be
newly issued Shares, Shares acquired by open market purchase and/or Shares purchased from ATOP
Participants, as determined by the Administrator in its sole discretion. At the time the AMTOP
Payment is made to the Participant’s ATOP Account, the number of such vested AMTOP Credits will be
deducted from the Participant’s AMTOP Account. For purposes of this Section 5.7, an active Agent
participating in AMTOP is a Participant under contract with a Participating Agency on December 31
of the prior Plan Year.

          5.8. Reduction of AMTOP 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 ATOP Account,
then the AMTOP Payment and any prior AMTOP 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 ATOP
Account in respect to such liability.

          5.9. Value of Vested AMTOP Credits -

          (a) The value of vested AMTOP Credits shall be determined as of the January 1 on which such
AMTOP Credits vest by multiplying the number of AMTOP Credits then vesting times the Fair Market
Value per Share as determined as of the immediately preceding Valuation Date.

          (b) The value of AMTOP Credits vesting upon the death of a Participant shall be determined by
multiplying the number of such AMTOP 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 AMTOP Credits vesting upon the Disability of a Participant shall be
determined by multiplying the number of such AMTOP 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.

- 12 -

 

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 AMTOP at any time for any reason, provided, however, that (a) no such amendment may
(i) reduce a Participant’s AMTOP 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 AMTOP Credit Addendum, including the stated Matching Percentage, by filing an amended AMTOP
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 AMTOP, it reserves the
right to terminate AMTOP at any time. AMTOP will terminate as to all Participants on the first to
occur of the following:

	 	(a)	 	the date AMTOP 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 AMTOP 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 AMTOP.

          6.3. Withdrawal of Participating Agency - A Participating Agency may withdraw its
participation in AMTOP, or the Sponsoring Company through the Administrator may terminate any
Participating Agency’s participation in AMTOP, 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 AMTOP, or the Sponsoring Company through the Administrator
withdraws its consent to the adoption of AMTOP by a Participating Agency, AMTOP 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. AMTOP Payments on Termination - On termination of AMTOP in accordance with Sections 6.2
or 6.3, vesting of AMTOP Credits will be at the sole discretion of the Sponsoring Company. Each
Participant’s final AMTOP 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 AMTOP Credits previously transferred to a Participant’s ATOP
Account.

          6.5. Notice of Amendment - The Administrator will notify affected Participants of any material
amendment or termination of AMTOP.

          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 AMTOP at any time and the right of the Sponsoring
Company to

- 13 -

 

terminate AMTOP as provided in Section 6.2 hereof at any time, it is agreed and hereby
acknowledged that the obligations, if any, to maintain and fund AMTOP 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 AMTOP. Notwithstanding the foregoing, the Sponsoring Company reserves the right to fund and/or
administer AMTOP through one or more of its subsidiaries.

          6.7. Prior Plan Agreements Superseded. The terms of AMTOP 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 AMTOP I and
AMTOP II.

          6.8.
Certificate of Incorporation – For the purposes of clarity, each Share transferred to a
Participant’s ATOP Account under AMTOP shall be subject to the provisions of the Certificate of
Incorporation, including any transfer, forced sale, redemption and other restrictions set forth
therein.

- 14 -

 

HealthMarkets, Inc.

Agency Matching Total Ownership Plan

AMTOP

AMTOP Credit Addendum

	 	 	 
	Participating Agency:

	 	UGA- Association Field Services,

a division of The MEGA Life and Health Insurance Company 

500 Grapevine Highway

Suite 300

Hurst, Texas 76054
	 
	 	 
	 

	 	New United Agency, Inc.

500 Grapevine Highway

Suite 300

Hurst, Texas 76054
	 
	 	 
	 

	 	Performance Driven Awards, Inc.

500 Grapevine Highway, Suite 300

Hurst, Texas 76054

	 	I.	 	MATCHING PERCENTAGE - Subject to the following provisions and Article IV of the AMTOP plan
document, the Matching Percentage is established at 100%.
	 
	 	II.	 	QUALIFYING PRODUCTION REQUIREMENT - Subject to the following provisions and Article IV of the
AMTOP plan document, each Participant will be eligible for a Matching Credit

- 15 -

 

	 	 	 	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:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	UGA – Association Field Services, a division of
The MEGA Life and Health Insurance Company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	New United Agency, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Performance Driven Awards, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 

- 16 -

 

HealthMarkets, Inc.

Agency Matching Total Ownership Plan

(“AMTOP”)

First Amendment

          This First Amendment (the “First Amendment”) amends that certain HealthMarkets, Inc. Agency
Matching Total Ownership Plan as amended and restated effective April 5, 2006 (“AMTOP”) 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 AMTOP.

          1. Pursuant to Section 6.1(a) of AMTOP, HealthMarkets, Inc. (the “Company”) hereby amends
Section 1.19 of AMTOP by deleting Section 1.19 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 AMTOP, 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	 	 

- 17 -

 

HealthMarkets, Inc.

Agency Matching Total Ownership Plan

(“AMTOP”)

Second Amendment

          This Second Amendment (this “Second Amendment”) amends that certain HealthMarkets, Inc. Agency
Matching Total Ownership Plan as amended and restated effective April 5, 2006, as further amended
by that certain First Amendment to the HealthMarkets, Inc. Agency Matching Total Ownership Plan
effective March 14, 2007 (as amended, “AMTOP”) 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 AMTOP.

          7. Pursuant to Section 6.1 of AMTOP, HealthMarkets, Inc. (the “Company”) hereby amends Section
4.5 of AMTOP 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 AMTOP Credits in a Participant’s AMTOP Account,
shall be credited to such Participant’s AMTOP 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.”

          8. The terms of AMTOP, as amended and supplemented hereby, are confirmed in all
respects and remain in full force and effect.

          9. This Second Amendment is effective as of May 3, 2007.

	 	 	 	 	 	 	 
	 	 	HealthMarkets, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	 
 

Peggy G. Simpson
	 	 
	 
	 

	 	Its:
	 	Corporate Secretary	 	 

- 18 -

 

HealthMarkets, Inc.

Agency Matching Total Ownership Plan

(“AMTOP”)

Third Amendment

     This Third Amendment (the “Third Amendment”) amends that certain HealthMarkets, Inc. Agency
Matching Total Ownership Plan as amended and restated effective April 5, 2006, as further amended
by that certain First Amendment to the HealthMarkets, Inc. Agency Matching Total Ownership Plan
effective as of March 14, 2007 and that certain Second Amendment to the HealthMarkets, Inc. Agency
Matching Total Ownership Plan effective as of May 3, 2007 (as amended, “AMTOP”) as and solely to
the extent expressly set forth herein. Except as otherwise expressly stated in this Third
Amendment, all capitalized terms used herein but not defined shall have the meanings assigned to
those terms under AMTOP.

     1. Pursuant to Section 6.1 of AMTOP, HealthMarkets, Inc. hereby amends AMTOP by deleting
Section 1.19 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. Following each Valuation Date or Special
Dividend Valuation Date, as applicable, Blackstone will deliver to the Board its current
valuation by no later than the earlier of: (1) any public announcement of the Company’s
financial results for the most recent fiscal period, or (2) the day that the Company files
with the United States Securities and Exchange Commission (the “SEC”) its next Quarterly
Report on Form 10-Q or, in the case of a Valuation Date coinciding with December 31 of each
Plan Year, by no later than the date that the Company files with the SEC its next Annual
Report on Form 10-K, and promptly 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 AMTOP, as amended and supplemented hereby, are confirmed in all
respects and remain in full force and effect.

     3. This Third Amendment is effective as of August 15, 2008.

	 	 	 	 	 
	 	HealthMarkets, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	Peggy
G. Simpson	 
	 	 	Its: 	Corporate Secretary	 
	 

- 19 -

 

HealthMarkets, Inc.

Agency Matching Total Ownership Plan

(“AMTOP”)

Fourth Amendment

     This Fourth Amendment (the “Fourth Amendment”) amends that certain HealthMarkets, Inc. Agency
Matching Total Ownership Plan as amended and restated effective April 5, 2006, as further amended
by that certain First Amendment to the HealthMarkets, Inc. Agency Matching Total Ownership Plan
effective March 14, 2007, that certain Second Amendment to the HealthMarkets, Inc. Agency Matching
Total Ownership Plan effective May 3, 2007 and that certain Third Amendment to the HealthMarkets,
Inc. Agency Matching Total Ownership Plan effective August 15, 2008 (as amended, “AMTOP”), as and
solely to the extent expressly set forth herein. Except as otherwise expressly stated in this
Fourth Amendment, all capitalized terms used herein shall have the meanings assigned to those terms
under AMTOP.

     1. Pursuant to Section 6.1 of AMTOP, effective as of December 31, 2008 HealthMarkets, Inc.
(the “Company”) hereby amends AMTOP by deleting Section 1.15 in its entirety and inserting in lieu
thereof and in substitution therefore the following:

     “Disability” means (i) for a Participant who has not attained full Social
Security retirement age, the physical or mental disability of such Participant that
constitutes a total disability as determined by the Social Security Administration
and (ii) for a Participant who has attained full Social Security retirement age, the
physical or mental disability of such Participant that constitutes a total
disability as determined by the Plan Administrator.

     2. Pursuant to Section 6.1 of AMTOP, effective as of September 1, 2008 the Company hereby
amends AMTOP by deleting Section 1.26 in its entirety and inserting in lieu thereof and in
substitution therefore the following:

     “Matching Percentage” means the percentage designated from time to time by each
Participating Agency on an AMTOP Credit Addendum for purposes of determining the
Matching Credits to be posted pursuant to Section 4.1 to a Participant’s AMTOP
Account by the Administrator on behalf of the Sponsoring Company; provided, however,
that the Matching Percentage is established initially at one hundred percent (100%).
Notwithstanding the foregoing, subject to the last sentence of this Section 1.26,
the Matching Percentage shall be increased and shall be equal to two hundred percent
(200%) with respect to such eligible Agent’s Matching Credits posted during the
period beginning on September 1, 2008 and ending on December 31, 2010 (the “New
Horizon Period”) for any Participant so long as: (i) the Participant has completed
in a timely manner any New Horizon enrollment form(s) required by the Administrator
and (ii) the Participant does not request during the New Horizon Period a partial
withdrawal under Section 8.2 of ATOP (other than a partial withdrawal under Section
8.2(a)(3) of ATOP), a complete withdrawal under Section 8.3 of ATOP (other than a
complete withdrawal under Section 8.3(b) of ATOP as a result of death or Disability)
or a special ATOP distribution and withdrawal under Section 8.5 of ATOP (other than
a special ATOP distribution and withdrawal under Section 8.5(a) of ATOP as of the
Initial Dream Team I Withdrawal Date, but not in any period succeeding the Initial
Dream Team I Withdrawal Date). The additional one hundred percent (100%) added to
the Matching Percentage during the New Horizon Period, together with the additional $1,000 added to the
maximum monthly Matching Credit during the New Horizon Period as described in the

- 20 -

 

first sentence of Section 4.1, shall be referred to herein as the “New Horizon
Enhancement.” The New Horizon Enhancement shall apply only during the period of the
Participant’s enrollment in New Horizon and shall apply solely to first year
commissions and/or compensation and not to renewal commissions and/or compensation.

     3. Pursuant to Section 6.1 of AMTOP, effective as of September 1, 2008 the Company hereby
amends AMTOP by deleting Section 4.1 in its entirety and inserting in lieu thereof and in
substitution therefore the following:

     Matching Credit — For any given month, a Participant must meet the production
requirement set forth on the applicable AMTOP Credit Addendum and make an ATOP
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;
provided, further, that during the New Horizon Period in no event shall the value of
a monthly Matching Credit exceed $3,000 in any given month so long as: (i) the
Participant has completed in a timely manner any New Horizon enrollment form(s)
required by the Administrator and (ii) the Participant does not request during the
New Horizon Period a partial withdrawal under Section 8.2 of ATOP (other than a
partial withdrawal under Section 8.2(a)(3) of ATOP), a complete withdrawal under
Section 8.3 of ATOP (other than a complete withdrawal under Section 8.3(b) of ATOP
as a result of death or Disability) or a special ATOP distribution and withdrawal
under Section 8.5 of ATOP (other than a special ATOP distribution and withdrawal
under Section 8.5(a) of ATOP as of the Initial Dream Team I Withdrawal Date, but not
in any period succeeding the Initial Dream Team I Withdrawal Date). Each month the
Administrator will post on behalf of a Participating Agency a Matching Credit to the
AMTOP Account of each Participant eligible for such Matching Credit. Except as
provided in the applicable AMTOP Credit Addendum, the Matching Credit posted to each
Participant’s AMTOP Account, if any, shall equal the number of Shares purchased
under ATOP for that month with the Participant’s ATOP contribution, excluding any
Enhancement Amounts (as that term is defined in ATOP), 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 ATOP) for the Participant’s
ATOP contributions for the month.

     4. Pursuant to Section 6.1 of AMTOP, effective as of December 31, 2008 the Company hereby
amends AMTOP by deleting Section 5.4 in its entirety and inserting in lieu thereof and in
substitution therefore the following:

     Vesting and Payment on Termination Due to Death or Disability — If a Participant
experiences a Termination Date due to death or Disability, the Participant’s AMTOP Credits
that have not vested as of such Termination Date will become one hundred percent (100%)
vested and the Sponsoring Company will make an AMTOP Payment to the Participant’s ATOP
Account with respect to such vested AMTOP Credits as soon as administratively practicable
after such Termination Date.

     5. Pursuant to Section 6.1 of AMTOP, effective as of September 1, 2008 the Company
hereby amends AMTOP by adding the following as a new Section 5.10:

     Vesting of New Horizon Enhancement — Notwithstanding any other provision of
Article V, any portion of a Participant’s AMTOP Account balance that is a New
Horizon Enhancement shall remain unvested until January 1, 2011, on which date such
portion of the Participant’s AMTOP Account shall become vested otherwise in
accordance with the

- 21 -

 

terms of Article V, with the Participant receiving credit for
any vesting that otherwise would have occurred during the New Horizon Period.
Notwithstanding any other provision of Article V, any portion of a Participant’s
AMTOP Account balance that is a New Horizon Enhancement that is forfeited shall not
become part of the Forfeiture Credit Pool.

     6. Pursuant to Section 6.1 of AMTOP, effective as of December 31, 2008 the Company hereby
amends AMTOP by adding the following as a new Section 6.9:

     Section 409A of the Code. To the extent applicable, it is intended that the
compensation arrangements under AMTOP be in full compliance with Section 409A of the
Internal Revenue Code of 1986, as amended, and the regulations and any other formal guidance
promulgated with respect to such Section by the U.S. Department of the Treasury or the
Internal Revenue Service (collectively, “Section 409A”). The AMTOP will be construed, to
the maximum extent permitted, in a manner to give effect to such intention. To the extent
that any provision of AMTOP would result in a Participant being subject to payment of the
additional tax, interest and penalty under Section 409A, the Sponsoring Company through the
Administrator reserves the right to amend AMTOP at any time in order to bring AMTOP into
compliance with Section 409A; and thereafter interpret its provisions in a manner that
complies with Section 409A. In no event whatsoever (including, but not limited to, as a
result of this Section or otherwise) will the Sponsoring Company or any of its affiliates be
liable for any tax, interest or penalties that may be imposed on a Participant under Section
409A. Neither the Sponsoring Company nor any of its affiliates will have any obligation to
indemnify or otherwise hold a Participant harmless from any or all such taxes, interest or
penalties, or liability for any damages related thereto.

     7. The terms of AMTOP, as amended and supplemented hereby, are confirmed in all respects and
remain in full force and effect.

	 	 	 	 	 
	 	HealthMarkets, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	Peggy
G. Simpson	 
	 	 	Its: 	Corporate Secretary	 
	 

- 22 -exv4w4

Exhibit 4.4

 

HEALTHMARKETS, INC.

Agent’s Contribution to Equity Plan

(As Amended and Restated Effective April 5, 2006)

(“ACE”)
 

	 	 	 
	Sponsoring Company	 	Participating Agencies
	HealthMarkets, Inc.

	 	Cornerstone America,
	9151 Boulevard 26

	 	a division of Mid-West National Life
	North Richland Hills, Texas 76180

	 	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

For Information Contact:

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.

AGENTS’ CONTRIBUTION TO EQUITY PLAN (ACE)

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 MAC.

     1.1. “ACE” means this HealthMarkets Agents’ Contribution to Equity Plan, as amended and
restated effective April 5, 2006.

     1.2. “ACE Account” shall have the meaning set forth in Section 6.1 hereof.

     1.3. “Administrator” means HealthMarkets, or any person or persons authorized by the Board of
Directors of HealthMarkets (the “Board”) to administer ACE.

     1.4. “Affiliates” means a wholly owned subsidiary of HealthMarkets.

     1.5. “Agent” means any independent insurance agent or independent field services
representative (“FSR”) who is a member of or contracted or associated with a Participating Agency
and who is not an employee of such Participating Agency.

     1.6. “Agent Plan Administrative Committee” shall have the meaning set forth in Section 2.8
hereof.

     1.7. “ASAP” shall mean the HealthMarkets Agents’ Stock Accumulation Plan, as amended and
restated as of April 5, 2006.

     1.8. “Base Monthly Contribution” means the maximum amount that a Participant may contribute
each month to his or her ACE Account (exclusive of any Enhancement Amount), as calculated under the
formula set forth in the Contribution Addendum for each applicable Participating Agency, which
Addenda are incorporated by reference into this ACE plan document and in no event shall the Base
Monthly Contribution exceed $2,000.

     1.9. “Beneficiary” means the person or persons to whom a deceased Participant’s benefits are
payable under Section 8.9.

     1.10. “Board” shall mean the Board of Directors of HealthMarkets as constituted from time to
time.

     1.11. “Calendar Year” means the twelve-month period commencing on January 1 and ending on
December 31.

     1.12. “Contract” means “Independent Insurance Agent Commission-Only Contract and/or FSR
Agreement between the Participant and a Participating Agency.”

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     1.13. “Contribution” means the amount contributed under Article IV by any Participant. All
Contributions shall be in the form of an advance on each Participant’s commissions and shall be
recorded as such on such Participant’s Debit Balance Account.

     1.14. “Contribution Addendum” means the addendum filed with the Administrator by each
Participating Agency setting forth the Base Monthly Contribution for such Participating Agency’s
participating Agents.

     1.15. “Credit Date” means the date that the Administrator will charge the Participant’s
Contributions to his or her Debit Balance Account and credit Shares to the Participant’s ACE
Account.

     1.16. “Debit Balance Account” means a separate book account of the monetary transactions
between a Participating Agency and Agent with respect to advances, commissions, and related
transactions on insurance policies and/or ancillary products sold through a Participating Agency.

     1.17. “Disability” means a Participant’s physical or mental disability to be determined by
reference to the effective Social Security guidelines.

     1.18. “Dream Team I Shares” at any date of determination shall mean the Initial Dream Team I
Share Balance (as such term is defined in Section 8.5(a) hereof ) less the number of Shares
withdrawn from ACE as of such date in accordance with Section 8.5(a); “Dream Team II Shares” at any
date of determination shall mean the Initial Dream Team II Share Balance (as such term is defined
in Section 8.5(b) hereof ) less the number of Shares withdrawn from ACE as of such date in
accordance with Section 8.5(b); and “Dream Team III Shares” at any date of determination shall mean
the Initial Dream Team III Share Balance (as such term is defined in Section 8.5(c) hereof ) less
the number of Shares withdrawn from ACE as of such date in accordance with Section 8.5(c).

     1.19. “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.

     1.20. “Effective Date” means April 5, 2006.

     1.21. “Enhancement Amount” means the amount, if any, by which a Participant elects under
Section 4.3 to increase his or her monthly Contribution over the Base Monthly Contribution.

     1.22. “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.

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     1.23. “HealthMarkets” means HealthMarkets, Inc. (formerly UICI), a Delaware corporation.

     1.24. “Indebtedness” shall mean any and all indebtedness (including the principal thereof and
any and all interest accrued thereon) of a Participant owing to HealthMarkets, a Participating
Agency or any Affiliates, including but not limited to the Participant’s and/or the Participant’s
Sub-Agent (as that term is defined in the then current Contract) Debit Balance Account, lead
account debt, Sub-Agent debt, and REAP advance of a Participating Agency or its Affiliates.

     1.25. “MAC” means the HealthMarkets Matching Agency Contribution Plan, as amended and restated
effective April 5, 2006.

     1.26. “Participant” means any individual who contributed to ACE and who has not experienced a
complete withdrawal under Section 8.3, and any Agent who becomes eligible for and elects to
participate in ACE.

     1.27. “Participating Agency” means any insurance agency, company or other organization, which,
with the consent of the Sponsoring Company, adopts ACE.

     1.28. “Period of Ineligibility” means a period of twelve (12) full calendar months during
which a person who was a Participant in ACE prior to the commencement of such period is not
eligible to participate in ACE, in accordance with Section 3.2, due to such Participant’s complete
withdrawal under Section 8.3(a).

     1.29. “Plan Year” means the Calendar Year.

     1.30. “Share” means a share of HealthMarkets’ Class A-2 common stock, $0.01 par value per
share.

     1.31. “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.

     1.32. “Special Dividend Valuation Date” shall mean the date on which the Board designates and
declares a Special Dividend.

     1.33. “Sponsoring Company”shall mean HealthMarkets.

     1.34. “Termination Date” means the date on which the Participant’s contractual relationship
with a Participating Agency is terminated due to such Participant’s Disability or death, or the
actual date on which the Participant otherwise ceases to be a member of or contracted with a
Participating Agency.

     1.35.
“Valuation Date” shall mean each March 31, June 30, September 30 and December 31 of each
Plan Year

     1.36. “Years of Participation” means the number of consecutive full Plan Years elapsed since
the date the Participant first became eligible to participate in ACE and filed with the
Administrator a properly completed DEC Participant’s Election Form subsequent to the end of such
Participant’s most recent Period of Ineligibility, if any.

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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 October 1, 2004; and
	 
	 	D.	 	the HealthMarkets Matching Agency Contribution Plan II (“MAC II”), as adopted as of
July 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 Contribution Plans - As of the Effective Date, (a) the Agent
Contribution Plans shall be consolidated as one plan and thereafter referred to as the
“HealthMarkets Agents’ Contribution to Equity Plan,” or “ACE”, (b) each of the Agent Contribution
Plans shall be and is hereby amended and restated in its entirety as provided in this plan
document, and (c) the Agent Matching Plans shall be consolidated as one plan and thereafter
referred to therein and herein as the “HealthMarkets Matching Agency Contribution Plan,” or “MAC”.

     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), (a)
each share of HealthMarkets common stock then owned by a Participant under any Agent Contribution
Plan shall be converted into the right to receive one Share (as defined in Section 1.30 above) and
shall thereafter be held under, and in accordance with and subject to the terms of, ACE, and (b)
each Matching Credit then posted to a Participant’s Account under any Agent Matching Plan shall
represent an equivalent book credit representing one Share (as defined in Section 1.30 above) and
shall 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

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HealthMarkets (the “Certificate of Incorporation”) 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. ACE 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 – ACE 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 ACE may include, but is not limited to,
valid certificates, affidavits, documents, or other information considered pertinent and reliable
by the Administrator.

     2.8. ACE Administration

     (a) Subject in all respects to the provisions hereof, the Sponsoring Company hereby appoints
the Administrator to control and manage the operation and administration of ACE.

     (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 Agent Plan 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 ACE. The Agent Plan
Administrative Committee shall meet as, if and when required under the terms of ACE, 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 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

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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, 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 ACE shall
be taken by an officer duly authorized to take such action by the Board, the Administrator, the
Agent Plan Administrative Committee or the Participating Agency, as the case maybe. If a
Participating Agency is not a corporation, any action required or permitted to be taken under ACE
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 And Participation – Subject to Section 3.2, each Agent will become eligible
for participation in ACE after completion of one (1) full Calendar Year following the date the
Agent entered into a written Contract with a Participating Agency during which the Agent is
continuously contracted with a Participating Agency. An Agent shall become a Participant in ACE as
of the January 1 next following the date the Agent completes the above-stated eligibility
requirements, if and so long as such Agent has filed with the Administrator, within the time period
determined by the Administrator from time to time, a properly completed DEC Participant’s Election
Form (the “DEC Participant’s Election Form”).

     3.2. Termination – A Participant’s participation in ACE shall terminate upon such
Participant’s complete withdrawal under Section 8.3. Any Agent whose ACE participation has

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terminated under this Section 3.2 due to a complete withdrawal under Section 8.3(a) shall not
again be eligible to participate in ACE until the passage of twelve (12) full calendar months
following the date of his or her complete withdrawal; provided, however, the Administrator shall
have the authority (upon the approval of the Agent Plan Administrative Committee) to waive the
applicability of such waiting period for a Participant on a case by case basis. Any Agent whose
ACE participation has terminated under this Section 3.2 due to a complete withdrawal under Section
8.3(b) shall not again be eligible to participate in ACE until he or she satisfies the eligibility
provisions of Section 3.1.

     3.3. Participation Not Contract Of Employment – ACE does not constitute a contract of
employment, and ACE participation does not give any Participant the right to be retained in the
service of any Participating Agency or HealthMarkets either as an employee or an independent
contractor, nor to any right or claim to any benefit under ACE, unless such right or claim has
specifically accrued under the terms of ACE.

ARTICLE IV.

PARTICIPANT CONTRIBUTIONS AND AMOUNTS TRANSFERRED FROM MAC

     4.1. Amount Available For Contribution – Subject to Section 4.3, the amount available each
month for a Participant to contribute into his or her ACE Account shall be such Participant’s Base
Monthly Contribution.

     4.2. Contributions – Notwithstanding any provision of ACE to the contrary, a Participating
Agency in its sole discretion may elect to suspend the right of a Participant to make a monthly
Contribution at any time. The monthly Contribution for each Participant shall be equal to the
dollar amount required to purchase on the Credit Date, in accordance with Section 5.1 and Section
5.2, the maximum possible number of whole Shares, based on the Fair Market Value of such Shares on
the applicable Credit Date, without exceeding the Participant’s Base Monthly Contribution. If for
a given month, the Base Monthly Contribution is less than the Fair Market Value of one Share on the
Credit Date, the Participant will not be eligible to make a Contribution that month. For the first
twenty-four (24) months of an Agent’s participation under ACE, the excess, if any, of a
Participant’s Base Monthly Contribution over his or her actual monthly Contribution shall be noted
each month in a separate book account maintained by the Administrator and aggregated with any
excess attributable to such Participant for prior months until the amount is sufficient to purchase
one whole Share. Such aggregate shall then be added to the next monthly Contribution. Each month,
the Participant’s Contribution, if any, shall be recorded as an advance on the Participant’s Debit
Balance Account and be remitted to the Administrator.

     4.3. Enhancement Amount – At the commencement of participation under ACE, a Participant may
elect on the DEC Participant Election Form provided by the Administrator to enhance his or her
monthly Contribution by an amount chosen by the Participant. A Participant’s elected Enhancement
Amount may be equal to the Participant’s Base Monthly Contribution, or a lesser, specified dollar
amount. Any election to contribute an Enhancement Amount may be modified or suspended once during
each calendar quarter by filing a new Election Form with the Administrator at least thirty (30)
days before the effective date of the modification or suspension. Each month, the Participant’s
Enhancement Amount, if any, shall be recorded as an advance on the Participant’s Debit Balance
Account and shall be remitted to the Administrator.

     4.4. Election To Suspend Contributions – Each Participant may elect in writing to suspend his
or her Contributions as of the first day of any month. Contributions may be resumed on the first
business day of the month following the receipt by the Administrator of a new Election Form filed
by the Participant. If the Participant does not resume Contributions to ACE within twelve (12)
months after the date of the Participant’s last Contribution, the Participant shall be deemed to have elected a
complete withdrawal under Section 8.3.

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     4.5. Transfers From MAC and Other Programs – Subject to the terms of MAC, Shares or cash
representing vested MAC Credits (as that term is defined in MAC) credited to an Agent under MAC may
be transferred to ACE from time to time. Transferred Shares shall be credited to such
Participant’s ACE Account as soon as administratively practicable following the date such Shares
are transferred from MAC. Transferred cash will be invested on behalf of the Participant in the
number of Shares equal to the amount of cash transferred divided by the Fair Market Value of each
such Share as of the date of transfer and will be credited to such Participant’s ACE Account as
soon as administratively practicable following the date such cash is transferred and invested. In
addition, in the discretion of the Administrator (upon the approval of the Agent Plan
Administrative Committee), Shares or cash representing certain credits awarded to an Agent under
other programs maintained by HealthMarkets or a Participating Agency may be transferred to ACE from
time to time. Such transfers shall be administered in the same manner as are transfers from MAC.

ARTICLE V.

PLAN INVESTMENTS

     5.1. Investment In Shares – The Sponsoring Company through the Administrator will invest each
Participant’s ACE Contributions and any cash transferred on behalf of such Participant from MAC in
whole Shares. Shares acquired under this Plan may be newly issued Shares, Shares acquired by open
market purchase (in the event that there is a regular public trading market for such Shares) and/or
Shares acquired from a Participant upon a Participant’s withdrawal under Section 8.3 hereof, as
determined by the Sponsoring Company in its sole discretion. Investment of the Participant’s
Contributions will be made on the Credit Date. Investment of MAC transferred cash will be made as
soon as administratively practicable following the date such cash is transferred from MAC.
Expenses incurred in making such investments, including brokerage commissions and transfer taxes,
if any, may be paid from the Participant’s Contribution and cash transferred on behalf of such
Participant from MAC, if any.

     5.2. Share Price – If there is a regular public trading market for Shares, in any month the
Sponsoring Company through the Administrator may purchase Shares (using borrowed funds) over a
period of time prior to and including any Credit Date to facilitate the orderly acquisition of
Shares for Participant’s ACE Accounts, and the price of each whole Share credited to any
Participant on the Credit Date for such month shall equal the Fair Market Value of such Shares on
the date of purchase.

ARTICLE VI.

PARTICIPANT ACE ACCOUNTS

     6.1. Participant ACE Accounts – The Sponsoring Company shall maintain under a trust
established for such purpose a separate account (an “ACE Account”) for each Participant reflecting
the Shares purchased by the Sponsoring Company on behalf of such Participant and the cash and cash
equivalents, if any (and investment earnings thereon), to which such Participant is entitled
pursuant to Section 6.3 hereof. Shares in a Participant’s ACE Account shall be held in book-entry,
uncertificated form. Each Participant shall be the beneficial owner of all Shares in his or her
ACE Account.

     6.2. Dividends – The amount of cash dividends, if any, with respect to Shares held in a
Participant’s ACE Account shall be distributed to such Participant not later than two and one-half
months after the close of the Plan Year in which such dividends are received by the Administrator,
unless the

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Administrator at the direction of the Sponsoring Company, in its sole discretion, applies such
dividends to such Participant’s Debit Balance Account.

     6.3. Special Dividends – Notwithstanding anything in Section 6.2 to the contrary, the
Administrator shall have the authority (upon the approval of the Agent Plan Administrative
Committee) to cause the amount that a Participant would have otherwise received in cash pursuant to
a Special Dividend, if any, with respect to Shares held in the Participant’s ACE Account at the
time of such Special Dividend (the “Special Dividend Proceeds”) to be credited to the Participant’s
ACE Account and subject to the provisions of this Section 6.3 until such time as the Participant
experiences a “Complete Withdrawal” under Section 8.3 of ACE or is entitled to special withdrawal
rights under Section 8.5 hereof. Any Special Dividend Proceeds held in a Participant’s ACE Account
(i) shall be promptly invested in direct obligations of the United States of America or any agency
thereof or obligations guaranteed by the United States of America or any agency thereof, in each
case with maturities not exceeding two years or (ii), upon the direction of the Participant, shall
be converted into the nearest whole number of Shares that the Participant could have purchased with
such Special Dividend Proceeds at the Fair Market Value per Share determined as of the applicable
Special Dividend Valuation Date. Upon declaration and designation by the Board of a Special
Dividend, the Administrator shall promptly notify each Participant of (w) the amount per Share of
such Special Dividend, (x) the expected date of payment of such Special Dividend, (y) the Fair
Market Value per Share determined as of the applicable Special Dividend Valuation Date and (z) the
whole number of Shares that a Participant would be entitled to receive pursuant to such Special
Dividend upon such Participant’s election to receive Shares, and a Participant shall have 30 days
after receipt of such notice to notify the Administrator of his or her election to have credited to
such Participant’s ACE Account cash or Shares as provided in the immediately preceding sentence.
Such cash or Shares shall be credited to the Participant’s ACE Account in each case not later than
the 15th day of the third month after the close of the Plan Year in which such dividends
are received by the Administrator, unless the Administrator at the direction of the Sponsoring
Company, in its sole discretion, applies such Special Dividend Proceeds to a Participant’s Debit
Balance Account.

     6.4. Valuation And Statement of Plan Interest – The Administrator shall provide each
Participant with monthly statements reflecting the value of his or her ACE Account, which monthly
statement shall designate and set forth (a) the total number of Shares in such Participant’s ACE
Account, (b) the number of Shares in such Participant’s ACE Account designated as Dream Team I
Shares, Dream Team II Shares and Dream Team III Shares, (c) the total number of MAC Credits then
posted to such Participant’s MAC Account, (d) the number of Founder’s Credits then posted to such
Participant’s MAC Account, (e) the number of Forfeiture Credits that would be posted to such
Participant’s MAC Account assuming allocation of the Forfeiture Pool as of such reporting date, (f)
the amount of cash and cash equivalents, if any, then credited to such Participant’s ACE Account,
and (g) such other information as the Administrator may from time to time determine. Shares in the
ACE Account shall be valued as of any date at Fair Market Value as determined as of the immediately
preceding Valuation Date.

     6.5. Nonforfeitable Interest – A Participant’s ACE Account shall be fully vested and
nonforfeitable at all times.

ARTICLE VII.

STOCKHOLDER RIGHTS

     7.1. Voting Rights – With respect to each annual or special meeting of HealthMarkets
stockholders, the Sponsoring Company will send to each Participant a copy of the proxy soliciting
material for the meeting sent to HealthMarkets stockholders generally, if any, together with a form
requesting instructions on how to vote the number of voting Shares credited to the Participant’s
ACE
Account as of the record date. The Sponsoring Company through the Administrator will hold in
confidence the voting instructions received.

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     7.2. Tender And Exchange Rights – The Sponsoring Company shall provide each Participant with
such notices and information statements as are provided to HealthMarkets stockholders generally
with respect to a tender or exchange offer together with a form requesting instructions on how to
direct HealthMarkets to act with respect to the Shares credited to such Participant’s ACE Account.
To the extent legally possible, the Administrator and HealthMarkets shall hold any such direction
in confidence.

ARTICLE VIII.

DISTRIBUTION, WITHDRAWAL, AND BENEFICIARY

     8.1. Manner of Distribution –

     (a) Upon a Participant’s withdrawal under Section 8.3, the Administrator will deduct from the
Participant’s ACE Account a number of Shares as is necessary to discharge such Participant’s
Indebtedness owing to HealthMarkets, a Participating Agency or its Affiliates, based on the then
Fair Market Value of such Shares; provided, however, that the Administrator shall not deduct such
Shares from the Participant’s ACE Account in the event that HealthMarkets, a Participating Agency
or its Affiliates, as applicable, waives its rights to utilize amounts vested under this Plan as
collateral for Indebtedness owing to HealthMarkets, a Participating Agency or its Affiliates. Such
a waiver of collateral rights under this Plan shall not constitute a waiver, release or
modification of any Indebtedness owed by an Agent to HealthMarkets, a Participating Agency or its
Affiliates. Any remaining Shares shall be distributed in kind to the withdrawing Participant
within sixty five (65) days, unless (a) such Participant shall request in writing at the time of
his or her withdrawal that the distribution of his or her ACE Account be in cash and (b) the
Sponsoring Company shall consent (which consent may be withheld in the sole discretion of the
Sponsoring Company) to the distribution of such Participant’s ACE Account in cash.

     (b) Shares purchased pursuant to this Section 8.1, if any, shall be purchased in accordance
with the following provisions, as applicable:

	 	1.	 	Shares purchased under this Section 8.1 pursuant to a complete withdrawal under
Section 8.3(a) or Section 8.3(b) (other than a complete withdrawal under Section 8.3(b)
due to the occurrence of a Termination Date attributable to the termination of a
Participant’s Contract for “cause,” which shall be governed by the succeeding
paragraph) shall be redeemed as provided in Article IX, Section 1 of the Certificate of
Incorporation at a redemption price equal to the Fair Market Value of such Shares as
determined as of the Valuation Date immediately preceding the applicable withdrawal
date; and
	 
	 	2.	 	Shares purchased under this Section 8.1 pursuant to a complete withdrawal under
Section 8.3(b) due to the occurrence of a Termination Date attributable to the
termination of a Participant’s Contract for “cause” shall be redeemed as provided in
Article IX, Section 1 of the Certificate of Incorporation at a redemption price equal
to the lesser of (i) the aggregate price paid by the Participant for the Shares being
redeemed and (ii) the Fair Market Value of such Shares as determined as of the
Valuation Date immediately preceding the applicable withdrawal date.
	 
	 	3.	 	The payment for Shares in cash as herein provided in this Section 8.1(b) shall
in all events be governed by and subject to the specific provisions respecting
redemption of Shares set forth in Article IX, Section 1 of the Certificate of Incorporation and
the provisions of Section 8.7 hereof.

11

 

     8.2. Partial Withdrawals –

     (a) A Participant who is at least 55 years of age may elect in writing on a form provided by
the Administrator to make a partial withdrawal from his or her ACE Account prior to his or her
Termination Date and remain eligible to participate in ACE, if and so long as the Fair Market Value
of the Shares remaining in such Participant’s ACE Account as of the date of any such partial
withdrawal is in excess of 150% of the principal amount of and accrued interest on Participant’s
Indebtedness owing to HealthMarkets, a Participating Agency or its Affiliates. Such election may
be made only once every Calendar Year as follows:

	 	1.	 	In the case of a Participant who has attained the age of fifty five (55), the
Participant may withdraw in any Calendar Year up to ten percent (10%) of the value in
his or her ACE Account (as of the date such withdrawal is paid), to the nearest whole
Share.
	 
	 	2.	 	In the case of a Participant who has attained the age of sixty (60), the
Participant may withdraw in any Calendar Year up to twenty percent (20%) of the value
in his or her ACE Account (as of the date such withdrawal is paid), to the nearest
whole Share.
	 
	 	3.	 	Upon a Participant’s receipt of a notice of an intent to levy or a valid
federal or state levy, a Participant may request to withdraw in cash a value equal to
the lesser of (i) the amount of the levy and (ii) an amount equal to the Fair Market
Value of the Shares remaining in such Participant’s ACE Account as of the date of any
such partial withdrawal in excess of 150% of the principal amount of and accrued
interest on Participant’s Indebtedness owing to HealthMarkets, a Participating Agency
or its Affiliates. Upon approval of the Agent Plan Administrative Committee, the
Participant will be permitted to make such withdrawal and payment in cash hereunder
will be made to the applicable state taxing authority and/or Internal Revenue Service,
as instructed by the tax levy.

     (b) All partial withdrawals shall be distributed in kind in Shares, unless (a) the withdrawing
Participant shall request in writing on a form provided by the Administrator at the time of his or
her withdrawal that the distribution be in cash and (b) the Sponsoring Company shall consent (which
consent may be withheld in the sole discretion of the Sponsoring Company) to the distribution in
cash. In the event that distribution under this Section 8.2 is made in cash, the Shares
representing the partial withdrawal shall be purchased from the withdrawing Participant’s ACE
Account at a price per Share equal to the then Fair Market Value of such Shares as determined as of
the Valuation Date immediately preceding the applicable withdrawal date. The payment for Shares as
herein provided in this Section 8.2 shall in all events be governed by and subject to the specific
provisions respecting redemption of Shares set forth in Article IX, Section 1 of the Certificate of
Incorporation and the provisions of Section 8.7 hereof.

     8.3. Complete Withdrawal – A complete withdrawal of all Shares from a Participant’s ACE
Account shall occur when:

	 	(a)	 	The Administrator receives, on a form provided by the Administrator, the
Participant’s written election to withdraw from ACE; or
	 
	 	(b)	 	The Participant experiences a Termination Date.

12

 

     All complete withdrawals shall be distributed in accordance with Section 8.1.

     8.4. Special Tax Withdrawal — In the case of a Participant who incurs a federal or state
personal income tax liability upon (i) the vesting of Matching Credits under MAC and subsequent
transfer of Shares pursuant to Section 4.5 of ACE or (ii) pursuant to the crediting of Special
Dividend Proceeds to such Participant’s ACE Account as provided for under Section 6.3 of ACE, the
Participant may elect to withdraw in cash (x) up to thirty five percent (35%) of the Fair Market
Value of Matching Credits then vesting and Shares transferred (with Fair Market Value determined as
of the December 31 immediately preceding the date of such vesting and transfer), with respect to
the vesting of Matching Credits under MAC as described in clause (i) above, and (y) up to thirty
five percent (35%) of such Special Dividend Proceeds, with respect to the crediting of Special
Dividend Proceeds to such Participant’s ACE Account as described in clause (ii) above. The payment
in cash hereunder will be made on or before April 15 to the State Taxing Authority and/or Internal
Revenue Service, as instructed by the Participant.

     8.5. Special ACE Distributions and Withdrawals

     (a) As of the January 1 immediately following the Calendar Year in which a Participant shall
have completed ten (10) Years of Participation in ACE (such January 1 herein referred to as the
“Initial Dream Team I Withdrawal Date”), the Participant shall have the right to elect to withdraw
a number of Shares equal to not more than fifty percent (50%) of the Shares in the Participant’s
ACE Account as of such Initial Dream Team I Withdrawal Date (the “Initial Dream Team I Share
Balance”), provided that the Participant then meets the Special ACE Distribution and Withdrawal
Conditions as set forth in Section 8.6 below. As of each January 1 of each of the four (4)
Calendar Years succeeding the Initial Dream Team I Withdrawal Date, the Participant shall have the
right to elect to withdraw a number of Shares equal to not more than twelve and one half percent
(12.5%) of the Initial Dream Team I Year Balance, plus any Shares that the Participant could have
withdrawn, but did not elect to withdraw, on the prior January 1 pursuant this subparagraph (a),
provided that the Participant then meets the Special ACE Distribution and Withdrawal Conditions as
outlined in Section 8.6 below. As of each January 1 thereafter, the Participant shall have the
right to elect to withdraw a number of Shares equal to 100% of the then remaining Initial Dream
Team I Share Balance to the extent such Shares were not previously withdrawn pursuant to the terms
of this subparagraph, provided that the Participant then meets the Special ACE Distribution and
Withdrawal Conditions as outlined in Section 8.6 below.

     (b) As of the January 1 immediately following the Calendar Year in which a Participant shall
have completed fifteen (15) Years of Participation in ACE (such January 1 herein referred to as the
“Initial Dream Team II Withdrawal Date”), the Participant shall have the right to elect to withdraw
a number of Shares equal to not more than fifty percent (50%) of the Shares in the Participant’s
ACE Account acquired during the five (5) Calendar Years immediately preceding such Dream Team II
Withdrawal Date (either through contributions under ACE or the vesting of MAC Credits) (the
“Initial Dream Team II Share Balance”), provided that the Participant then meets the Special ACE
Distribution and Withdrawal Conditions as set forth in Section 8.6 below. As of each January 1 of
each of the four (4) Calendar Years succeeding the Initial Dream Team II Withdrawal Date, the
Participant shall have the right to elect to withdraw up to fifty percent (50%) of

	 	(i)	 	the Initial Dream Team II Share Balance, less
	 
	 	(ii)	 	the number of Shares, if any, initially withdrawn pursuant to the immediately
preceding sentence and the number of Shares, if any, previously withdrawn pursuant to
this sentence;

13

 

provided that the Participant then meets the Special ACE Distribution and Withdrawal Conditions as
outlined in Section 8.6 below. As of each January 1 thereafter, the Participant shall have the
right to elect to withdraw a number of Shares equal to 100% of any Shares not previously withdrawn
pursuant to the two preceding sentences, provided that the Participant then meets the Special ACE
Distribution and Withdrawal Conditions as outlined in Section 8.6 below.

     (c) As of each January 1 following the Calendar Year in which a Participant shall have
completed sixteen (16) Years of Participation in ACE (each such January 1 herein referred to as a
“Dream Team III Withdrawal Date”), a Participant shall have the right to elect to withdraw up to
fifty percent (50%) of the Shares in the Participant’s ACE Account acquired during the Calendar
Year immediately preceding such Dream Team III Withdrawal Date (either through contributions under
ACE or the vesting of MAC Credits) plus any Shares that the Participant could have withdrawn, but
did not elect to withdraw, on the prior January 1 pursuant this subparagraph (c), provided that the
Participant then meets the Special ACE Distribution and Withdrawal Conditions as set forth in
Section 8.6 below.

     (d) A Participant shall have the right to withdraw cash or Shares held in his or her ACE
Account pursuant to the payment of Special Dividend Proceeds at the same time and in the same
percentages as provided for in Sections 8.5(a), (b) and (c) above.

     (e) The value of the Shares withdrawn, if applicable, shall be the Fair Market Value of such
Shares on the Valuation Date immediately preceding the applicable withdrawal date and shall be
distributed in accordance with Section 8.1 of ACE. If the Participant and/or the Participant’s
SubAgent (as that term is defined in the applicable Sales Leader Addendum by and between the
Participant and a Participating Agency (the “Addendum”) has Indebtedness owing to HealthMarkets, a
Participating Agency and/or its Affiliates, on the date that the Sponsoring Company through the
Administrator receives the Participants’ ACE special withdrawal request pursuant to this Section
8.5, the Sponsoring Company through the Administrator may on such date deduct the amount of the
Indebtedness from the value of the ACE Account prior to making distribution under this Section 8.5,
which deduction shall be based on the Fair Market Value of such Shares as determined as of the
immediately preceding Valuation Date.

     8.6. Special ACE Distribution and Withdrawal Conditions – For purposes of the foregoing
Section 8.5, a Participant shall have been deemed to have met the “Special ACE Distribution and
Withdrawal Conditions” upon satisfaction of each of the following conditions:

	 	(a)	 	The Participant’s Contract shall be in full force and effect with a
Participating Agency;
	 
	 	(b)	 	At the time of the Administrator’s receipt of the Participant’s ACE withdrawal
request, the then remaining balance of the Participant’s ACE Account shall be in excess
of the principal amount of and accrued interest on the Indebtedness; and
	 
	 	(c)	 	The Participant shall not otherwise have taken any action prohibited under the
terms of the Contract with a Participating Agency.

     Whether the Participant has satisfied the Special ACE Distribution and Withdrawal Conditions
shall be determined by the Sponsoring Company in its sole discretion.

     8.7. Share Purchase – It is the intent of the Sponsoring Company to accommodate requests from
Participants that the Sponsoring Company purchase Shares that such Participants offer for sale to
the Sponsoring Company upon such Participants’ withdrawal from ACE. However, the Sponsoring
Company shall not have any obligation to purchase such Shares. In making the determination whether
to purchase such Shares, the Sponsoring Company may consider, among other factors, (i) the
availability

14

 

under or limitations imposed by any credit agreement or other debt instrument to which the
Sponsoring Company may be subject and (ii) the Sponsoring Company’s capital and liquidity position,
as well as such other factors as the Sponsoring Company, in good faith, deems appropriate.
Notwithstanding the foregoing, the Sponsoring Company shall not purchase any Shares acquired upon
vesting of MAC Credits that have been held by a Participant for less than six months. The
Sponsoring Company’s purchase of Shares in a particular case will not create any actual or implied
obligation to purchase Shares in any future case.

     8.8. Payments To Persons Who Are Incompetent – In the event that a Participant or Beneficiary
is declared incompetent and the Administrator receives satisfactory evidence that a conservator or
other person legally charged with the care of the Participant’s or Beneficiary’s person or estate
has been appointed, the amount of any distribution to which such Participant or Beneficiary is
entitled to receive under ACE in accordance with Sections 8.1, 8.2, 8.3, 8.4, 8.5 and 8.6 shall be
paid to the conservator or other person legally charged with the care of the Participant’s or
Beneficiary’s person or estate.

     8.9. Interests Not Transferable – Except when permitted by the Sponsoring Company, in its sole
discretion, in the case of a tax lien levied by the Internal Revenue Service against the
Participant as an individual taxpayer, a Participant’s ACE Account may not be voluntarily assigned,
alienated or encumbered. In addition, to the extent permitted by law, a Participant’s ACE Account
may not be involuntarily assigned, alienated or encumbered. Notwithstanding the foregoing, a
Participant shall assign his or her ACE Account to a Participating Agency as security for the
Participant’s Debit Balance Account and other Indebtedness to HealthMarkets, a Participating Agency
or its Affiliates.

     8.10. Designation Of Beneficiary – Each Participant may designate, by signing a form furnished
by the Administrator, any legal person or persons (who may be designated contingent or successive)
to whom the Participant’s ACE Account is to be distributed in the event of the Participant’s death,
subject to repayment of Participant’s Indebtedness to HealthMarkets, a Participating Agency or its
Affiliates, including but not limited to any amount reflected in the Participant’s Debit Balance
Account. A Beneficiary designation will be effective upon the acknowledged receipt by the
Administrator of an executed Beneficiary designation form submitted by a living Participant. Any
newly submitted Beneficiary designation form shall cancel all earlier Beneficiary designations.

     8.11. Certificate of Incorporation – For the purposes of clarity, each Share purchased
pursuant to or transferred to a Participant’s ACE Account under ACE shall be subject to the
provisions of the Certificate of Incorporation, including any transfer, forced sale, redemption and
other restrictions set forth therein.

ARTICLE IX.

AMENDMENT AND TERMINATION OF ACE

     9.1. Amendment –

          (a) The Sponsoring Company reserves the right to amend ACE at any time for any reason;
provided, however, that (i) no amendment shall reduce the number of Shares in a Participant’s ACE
Account or restrict the right of a Participant to withdraw under Sections 8.2, 8.3, 8.4, 8.5 and
8.6 any amounts credited to his or her ACE Account prior to such amendment, and (ii) to the extent
required by applicable law or regulation, any proposed amendment to the Plan will be subject to
approval of the shareholders of HealthMarkets if such amendment would have the effect of (x)
materially increasing the benefits accruing to Participants under the Plan, (y) materially
increasing the aggregate number of
securities that may be issued under the Plan or (z) materially modifying the requirements as
to eligibility for participation in the Plan.

15

 

          (b) Any Participating Agency may, with approval of the Sponsoring Company, amend the Base
Monthly Contribution for such Participating Agency’s participating Agents at any time by filing an
amended Contribution Addendum with the Administrator. Amendments will become effective for
Contributions made forty-five (45) days after notice of any such amendment is distributed to
Participants in accordance with procedures established by the Administrator, in its sole
discretion, from time to time.

     9.2. Termination of the Plan – While the Sponsoring Company expects and intends to continue
ACE, the Sponsoring Company reserves the right to terminate ACE at any time. ACE will terminate as
to all Participants on the first to occur of the following:

	 	(a)	 	The date ACE is terminated by the Sponsoring Company,
	 
	 	(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 ACE will be continued by any successor to
HealthMarkets or any purchaser of all or substantially all of HealthMarkets’ assets, in
which case the successor or purchaser will be substituted for HealthMarkets under ACE.

     9.3. Withdrawal Of Participating Agency – A Participating Agency may withdraw its
participation in ACE, or the Sponsoring Company through the Administrator may terminate any
Participating Agency’s participation, in each case by submitting written notification of such
withdrawal or termination to the other party at least thirty (30) days prior to the effective date
of such withdrawal or termination of participation. Subject to Section 9.4, as of the effective
date of any such withdrawal or termination of participation, all Participants who are then
contracted or associated with such Participating Agency will be deemed to have experienced a
Termination Date.

     9.4. Payments on Termination – On termination of ACE under Section 9.2, each Participant’s ACE
Account will be distributed to the Participant in accordance with Article VIII. Upon withdrawal or
termination of a Participating Agency under Section 9.3, each affected Participant’s ACE Account
will be distributed to the Participant in accordance with Article VIII, unless the Sponsoring
Company consents, in its sole discretion, to such Participant’s continuation in ACE.

     9.5. Notice of Amendment – The Administrator will notify affected Participants and
Beneficiaries of any material amendment or termination of ACE.

     9.6. Prior Plan Agreements Superseded. The terms of ACE 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 ACE I and ACE
II.

     9.7. Rights of Participants – Subject in all respects to the right of the Sponsoring Company
as provided in Section 9.1 hereof to amend ACE at any time and the right of the Sponsoring Company
to terminate ACE as provided in Section 9.2 hereof at any time, it is agreed and hereby
acknowledged that the obligation, if any, to maintain ACE shall be and remain solely the obligation
of HealthMarkets in its capacity as Sponsoring Company and not the obligation of any of
HealthMarkets’ subsidiaries, and no Participant hereunder shall have recourse to or other rights
against any of HealthMarkets’ subsidiaries in

16

 

connection with the maintenance or administration of ACE. Notwithstanding the foregoing, the
Sponsoring Company reserves the right to maintain and/or administer ACE through one or more of its
subsidiaries.

17

 

HealthMarkets, Inc.

Agents’ Contribution to Equity

ACE

Contribution 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

In accordance with Sections 1.8 and 4.1 of ACE, each Participant’s Base Monthly Contribution shall
be calculated as a percentage of such Participant’s commissions, as set forth below; provided that
a Participant’s Base Monthly Contribution shall never exceed $2,000 in the aggregate from
commissions and/or compensation received from all Participating Agencies.

	 	A.	 	Commissions from personal production.

	 	1.	 	One percent (1%) of the first year commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Twenty-five percent (25%) of renewal commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month.

	 	B.	 	Override commissions for all Field Leader levels.

	 	1.	 	One percent (1%) of the first year commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Twenty percent (20%) of the renewal commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month.

     This Addendum is effective as of April 5, 2006.

	 	 	 	 	 	 	 	 	 
	HealthMarkets, Inc.	 	Cornerstone America, a division of Mid-West National Life
Insurance Company of Tennessee
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	 

	 	 

	 	 
	Printed Name:

	 	 	 	Printed Name:	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 

	 	 

	 	 

18

 

HealthMarkets, Inc.

Agents’ Contribution to Equity Plan

ACE

Contribution Addendum

	 	 	 
	Participating Agency:

	 	Success Driven Awards, Inc.
	 

	 	c/o HealthMarkets
	 

	 	9151 Boulevard 26
	 

	 	North Richland Hills, Texas 76180

     In accordance with Sections 1.8 and 4.1 of ACE, each Participant’s Base Monthly Contribution
shall be calculated as a percentage of such Participant’s field services representative
compensation (“FSR Compensation”), as set forth below; provided that a Participant’s Base Monthly
Contribution shall never exceed $2,000 in the aggregate from commissions and/or compensation
received from all Participating Agencies.

	 	A.	 	FSR Compensation from personal production.

	 	1.	 	One percent (1%) of the first year FSR Compensation posted to
the Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Twenty-five percent (25%) of FSR Compensation posted to the
Participant’s Debit Balance Account in the immediate preceding month.

	 	B.	 	Override FSR Compensation for all Field Leader levels.

	 	1.	 	One percent (1%) of the first year FSR Compensation posted to
the Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Twenty percent (20%) of the renewal FSR Compensation posted to the Participant’s Debit
Balance Account in the immediate preceding month.

     This Addendum is effective as of April 5, 2006.

	 	 	 	 	 	 	 	 	 
	HealthMarkets, Inc.	 	Success Driven Awards, Inc.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	 

	 	 

	 	 
	Printed Name:

	 	 	 	Printed Name:	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 
	Title:

	 	 	 	Title:	 	 	 	 
	 

	 	 

	 	 

19

 

EXHIBIT A

HealthMarkets, Inc.

Agents’ Contribution to Equity Plan

(“ACE”)

First Amendment

     This First Amendment (the “First Amendment”) amends that certain HealthMarkets, Inc. Agents’
Contribution to Equity Plan as amended and restated effective April 5, 2006 (“ACE”) 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
ACE.

     1. Pursuant to Section 9.1(a) of ACE, HealthMarkets, Inc. (the “Company”) hereby amends
Section 1.22 of ACE by deleting Section 1.22 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. Pursuant to Section 9.1(a) of ACE, the Company hereby amends Section 8.4 of ACE by deleting
Section 8.4 in its entirety and inserting in lieu thereof and in substitution therefor the
following:

“Special Tax Withdrawal — In the case of a Participant who incurs a federal or state
personal income tax liability upon (i) the vesting of Matching Credits under MAC and
subsequent transfer of Shares pursuant to Section 4.5 of ACE or (ii) pursuant to the
crediting of Special Dividend Proceeds to such Participant’s ACE Account as provided for
under Section 6.3 of ACE, the Participant may elect to withdraw in cash (x) up to an amount
equal to the applicable Federal and state income tax rates with respect to the Matching
Credits then vesting and Shares transferred (with Fair Market Value determined as of the
December 31 immediately preceding the date of such vesting and transfer), with respect to
the vesting of Matching Credits under MAC as

20

 

described in clause (i) above, and (y) up to the applicable Federal and state income tax
rates with respect to such Special Dividend Proceeds, with respect to the crediting of
Special Dividend Proceeds to such Participant’s ACE Account as described in clause (ii)
above. The payment in cash hereunder will be made on or before April 15 to the State Taxing
Authority and/or Internal Revenue Service, as instructed by the Participant.”

     3. Pursuant to Section 9.1(a) of ACE, the Company hereby amends Section 8.7 of ACE by deleting
Section 8.7 in its entirety and inserting in lieu thereof and in substitution therefor the
following:

“Share Purchase – It is the intent of the Sponsoring Company to accommodate requests
from Participants that the Sponsoring Company purchase Shares that such Participants
offer for sale to the Sponsoring Company upon such Participants’ withdrawal from
ACE. However, the Sponsoring Company shall not have any obligation to purchase such
Shares. In making the determination whether to purchase such Shares, the Sponsoring
Company may consider, among other factors, (i) the availability under or limitations
imposed by any credit agreement or other debt instrument to which the Sponsoring
Company may be subject and (ii) the Sponsoring Company’s capital and liquidity
position, as well as such other factors as the Sponsoring Company, in good faith,
deems appropriate. Notwithstanding the foregoing, the Sponsoring Company shall not
purchase any Shares acquired upon the vesting of MAC Credits that have been held by
a Participant for less than six months; provided, however, that this restriction
shall not apply in the case of a complete withdrawal from ACE pursuant to Section
8.3 hereof by reason of termination of a Participant’s contractual relationship with
a Participating Agency due to such Participant’s Disability or death. The
Sponsoring Company’s purchase of Shares in a particular case will not create any
actual or implied obligation to purchase Shares in any future case.”

     4. The terms of ACE, as amended and supplemented hereby, are confirmed in all respects
and remain in full force and effect.

     5. This First Amendment is effective as of March 14, 2007.

	 	 	 	 	 
	 	 	HealthMarkets, Inc.
	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 
	 

	 	Name:
	 	Peggy G. Simpson
	 
	 

	 	Its:
	 	Corporate Secretary

21

 

HealthMarkets, Inc.

Agent’s Contribution to Equity Plan

(“ACE”)

Second Amendment

     This Second Amendment (this “Second Amendment”) amends that certain HealthMarkets, Inc.
Agent’s Contribution to Equity Plan as amended and restated effective April 5, 2006, as further
amended by that certain First Amendment to the HealthMarkets, Inc. Agent’s Contribution to Equity
Plan effective March 14, 2007 (as amended, “ACE”) 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 ACE.

     6. Pursuant to Section 9.1(a) of ACE, HealthMarkets, Inc. (the “Company”) hereby amends
Section 6.3 of ACE by deleting Section 6.3 in its entirety and inserting in lieu thereof and in
substitution therefor the following:

“Special Dividends – Notwithstanding anything in Section 6.2 to the contrary, the
Administrator shall have the authority (upon the approval of the Agent Plan Administrative
Committee) to cause the amount that a Participant would have otherwise received in cash
pursuant to a Special Dividend, if any, with respect to Shares held in the Participant’s ACE
Account at the time of such Special Dividend (the “Special Dividend Proceeds”) to be
credited to the Participant’s ACE Account and subject to the provisions of this Section 6.3
until such time as the Participant experiences a “Complete Withdrawal” under Section 8.3 of
ACE or is entitled to special withdrawal rights under Section 8.5 hereof. Any Special
Dividend Proceeds held in a Participant’s ACE Account shall be converted into the nearest
whole number of Shares that the Participant could have purchased with such Special Dividend
Proceeds at the Fair Market Value per Share determined as of the applicable Special Dividend
Valuation Date. Upon declaration and designation by the Board of a Special Dividend, the
Administrator shall promptly notify each Participant of (w) the amount per Share of such
Special Dividend, (x) the expected date of payment of such Special Dividend, (y) the Fair
Market Value per Share determined as of the applicable Special Dividend Valuation Date and
(z) the whole number of Shares that a Participant is entitled to receive pursuant to such
Special Dividend. Such Shares shall be credited to the Participant’s ACE Account promptly
after such dividends are received by the Administrator, unless the Administrator at the
direction of the Sponsoring Company, in its sole discretion, applies such Special Dividend
Proceeds to a Participant’s Debit Balance Account.”

     7. Pursuant to Section 9.1(a) of ACE, the Company hereby amends Section 6.2 of ACE by deleting
Section 6.2 in its entirety and inserting in lieu thereof and in substitution therefor the
following:

“Dividends – The amount of cash dividends, if any, with respect to Shares held in a
Participant’s ACE Account shall be distributed to such Participant promptly after the such
dividends are received by the Administrator, unless the Administrator at the direction of
the Sponsoring Company, in its sole discretion, applies such dividends to such Participant’s
Debit Balance Account.”

     8. Pursuant to Section 9.1(a) of ACE, the Company hereby amends Section 8.1(a) of ACE by
deleting Section 8.1(a) in its entirety and inserting in lieu thereof and in substitution therefor
the following:

22

 

     “Manner of Distribution –

(a) Upon a Participant’s withdrawal under Section 8.3, the Administrator will deduct
from the Participant’s ACE Account a number of Shares as is necessary to discharge such
Participant’s Indebtedness owing to HealthMarkets, a Participating Agency or its Affiliates,
based on the then Fair Market Value of such Shares; provided, however, that the
Administrator shall not deduct such Shares from the Participant’s ACE Account in the event
that HealthMarkets, a Participating Agency or its Affiliates, as applicable, waives its
rights to utilize amounts vested under this Plan as collateral for Indebtedness owing to
HealthMarkets, a Participating Agency or its Affiliates. Such a waiver of collateral rights
under this Plan shall not constitute a waiver, release or modification of any Indebtedness
owed by an Agent to HealthMarkets, a Participating Agency or its Affiliates. Any remaining
Shares shall be distributed in kind to the withdrawing Participant promptly, unless (a) such
Participant shall request in writing at the time of his or her withdrawal that the
distribution of his or her ACE Account be in cash and (b) the Sponsoring Company shall
consent (which consent may be withheld in the sole discretion of the Sponsoring Company) to
the distribution of such Participant’s ACE Account in cash.”

     9. The terms of ACE, as amended and supplemented hereby, are confirmed in all respects
and remain in full force and effect.

     10. This Second Amendment is effective as of May 3, 2007.

	 	 	 	 	 	 	 
	 	 	HealthMarkets, Inc.	 	 
	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

Peggy G. Simpson
	 	 
	 

	 	Its:
	 	Corporate Secretary	 	 

23

 

HealthMarkets, Inc.

Agent’s Contribution to Equity Plan

(“ACE”)

Third Amendment

     This Third Amendment (the “Third Amendment”) amends that certain HealthMarkets, Inc. Agent’s
Contribution to Equity Plan as amended and restated effective April 5, 2006, as further amended by
that certain First Amendment to the HealthMarkets, Inc. Agent’s Contribution to Equity Plan
effective as of March 14, 2007 and that certain Second Amendment to the HealthMarkets, Inc. Agent’s
Contribution to Equity Plan effective as of May 3, 2007 (as amended, “ACE”) as and solely to the
extent expressly set forth herein. Except as otherwise expressly stated in this Third Amendment,
all capitalized terms used herein but not defined shall have the meanings assigned to those terms
under ACE.

     1. Pursuant to Section 9.1(a) of ACE, HealthMarkets, Inc. hereby amends ACE by deleting
Section 1.22 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. Following each Valuation Date or Special
Dividend Valuation Date, as applicable, Blackstone will deliver to the Board its current
valuation by no later than the earlier of: (1) any public announcement of the Company’s
financial results for the most recent fiscal period, or (2) the day that the Company files
with the United States Securities and Exchange Commission (the “SEC”) its next Quarterly
Report on Form 10-Q or, in the case of a Valuation Date coinciding with December 31 of each
Plan Year, by no later than the date that the Company files with the SEC its next Annual
Report on Form 10-K, and promptly 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 ACE, as amended and supplemented hereby, are confirmed in all respects
and remain in full force and effect.

     3. This Third Amendment is effective as of August 15, 2008.

	 	 	 	 	 
	 	HealthMarkets, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	Peggy
G. Simpson	 
	 	 	Its: 	Corporate Secretary	 
	 

24

 

HealthMarkets, Inc.

Agent’s Contribution to Equity Plan

(“ACE”)

Fourth Amendment

     This Fourth Amendment (the “Fourth Amendment”) amends that certain HealthMarkets, Inc. Agent’s
Contribution to Equity Plan as amended and restated effective April 5, 2006, as further amended by
that certain First Amendment to the HealthMarkets, Inc. Agent’s Contribution to Equity Plan
effective March 14, 2007, that certain Second Amendment to the HealthMarkets, Inc. Agent’s
Contribution to Equity Plan effective May 3, 2007 and that certain Third Amendment to the
HealthMarkets, Inc. Agent’s Contribution to Equity Plan effective August 15, 2008 (as amended,
“ACE”) as and solely to the extent expressly set forth herein. Except as otherwise expressly
stated in this Fourth Amendment, all capitalized terms used herein shall have the meanings assigned
to those terms under ACE.

     1. Pursuant to Section 9.1(a) of ACE, HealthMarkets, Inc. (the “Company”) hereby amends ACE by
deleting Section 1.8 in its entirety and inserting in lieu thereof and in substitution therefor the
following:

     “Base Monthly Contribution” means the maximum amount that a Participant may
contribute each month to his or her ACE Account (exclusive of any Enhancement
Amount), as calculated under the formula set forth in the Contribution Addendum for
each applicable Participating Agency, which Addenda are incorporated by reference
into this ACE plan document and in no event shall the Base Monthly Contribution
exceed $2,000. Notwithstanding the foregoing, the Base Monthly Contribution shall
not exceed $3,000 during the period beginning on September 1, 2008 and ending on
December 31, 2010 (the “New Horizon Period”) for any Participant so long as: (i) the
Participant has completed in a timely manner any New Horizon enrollment form(s)
required by the Administrator and (ii) the Participant does not request during the
New Horizon Period a partial withdrawal under Section 8.2 (other than a partial
withdrawal under Section 8.2(a)(3)), a complete withdrawal under Section 8.3 (other
than a complete withdrawal under Section 8.3(b) as a result of death or Disability)
or a special ACE distribution and withdrawal under Section 8.5 (other than a special
ACE distribution and withdrawal under Section 8.5(a) as of the Initial Dream Team I
Withdrawal Date, but not in any period succeeding the Initial Dream Team I
Withdrawal Date). The additional $1,000 maximum Base Monthly Contribution available
to Participants during the New Horizon Period shall be referred to herein as the
“New Horizon Enhancement.”

     2. Pursuant to Section 9.1(a) of ACE, the Company hereby amends ACE by deleting Section 1.17
in its entirety and inserting in lieu thereof and in substitution therefor the following:

     “Disability” means (i) for a Participant who has not attained full Social
Security retirement age, the physical or mental disability of such Participant that
constitutes a total disability as determined by the Social Security Administration
and (ii) for a Participant who has attained full Social Security retirement age, the
physical or mental disability of such Participant that constitutes a total
disability as determined by the Plan Administrator.

25

 

     3. Pursuant to Section 9.1(a) of ACE, the Company hereby amends ACE by deleting Section 3.2 in
its entirety and inserting in lieu thereof and in substitution therefor the following:

     Termination — A Participant’s participation in ACE shall terminate upon such
Participant’s complete withdrawal under Section 8.3. Any Agent whose ACE
participation has terminated under this Section 3.2 due to a complete withdrawal
under Section 8.3(a) shall not again be eligible to participate in ACE until the
passage of twelve (12) full calendar months following the date of his or her
complete withdrawal; provided, however, the Administrator shall have the authority
(upon the approval of the Agent Plan Administrative Committee) to waive the
applicability of such waiting period for a Participant on a case by case basis. Any
Agent whose ACE participation has terminated under this Section 3.2 due to a
complete withdrawal under Section 8.3(b) shall not again be eligible to participate
in ACE until he or she satisfies the eligibility provisions of Section 3.1.
Notwithstanding the foregoing, the waiting period described in this Section 3.2
shall not apply to any Participant whose ACE participation has terminated under this
Section 3.2 so long as the Participant elects to participate in ACE and New Horizon
on or before November 30, 2008.

     4. Pursuant to Section 9.1(a) of ACE, the Company hereby amends ACE by deleting Section 4.3 in
its entirety and inserting in lieu thereof and in substitution therefor the following:

     Enhancement Amount — At the commencement of participation under ACE, a
Participant may elect on the DEF Participant Election Form provided by the
Administrator to enhance his or her monthly Contribution by an amount chosen by the
Participant. A Participant’s elected Enhancement Amount may be equal to the
Participant’s Base Monthly Contribution, or a lesser, specified dollar amount. Any
election to contribute an Enhancement Amount may be modified or suspended once
during each calendar quarter by filing a new Election Form with the Administrator at
least thirty (30) days before the effective date of the modification or suspension.
Each month, the Participant’s Enhancement Amount, if any, shall be recorded as an
advance on the Participant’s Debit Balance Account and shall be remitted to the
Administrator. Notwithstanding the foregoing, a Participant may elect on or before
November 30, 2008 to increase his or her Enhancement Amount during the New Horizon
Period up to the maximum Base Monthly Contribution allowed under the second sentence
of Section 1.8, and such election may be modified or suspended once during each
calendar quarter by filing a new Election Form with the Administrator at least
thirty (30) days before the effective date of the modification or suspension.

     5. Pursuant to Section 9.1(a) of ACE, the Company hereby amends ACE by adopting the following
Contribution Addenda to be used with Participants eligible under Section 1.8 for a New Horizon
Enhancement during the New Horizon Period:

26

 

HealthMarkets, Inc.

Agent’s Contribution to Equity

ACE

Contribution Addendum

	 	 	 
	Participating Agency:

	 	Cornerstone America,
	 

	 	a division of Mid-West National Life Insurance
Company of Tennessee
	 

	 	c/o HealthMarkets
	 

	 	9151 Boulevard 26
	 

	 	North Richland Hills, Texas 76180

In accordance with Sections 1.8 and 4.1 of ACE, each Participant’s Base Monthly Contribution shall
be calculated as a percentage of such Participant’s commissions, as set forth below; provided that
a Participant’s Base Monthly Contribution shall never exceed $2,000 ($3,000 during the New Horizon
Period, subject to the conditions of Section 1.8 of ACE) in the aggregate from commissions and/or
compensation received from all Participating Agencies.

	 	A.	 	Commissions from personal production.

	 	1.	 	One percent (1%) of the first year commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Up to an additional four percent (4%) of the first year
commissions posted to the Participant’s Debit Balance Account in the immediate
preceding month, provided the Participant remains eligible under Section 1.8 of
ACE for a New Horizon Enhancement during the New Horizon Period; plus
	 
	 	3.	 	Twenty-five percent (25%) of the renewal commissions posted to
the Participant’s Debit Balance Account in the immediate preceding month.

	 	B.	 	Override commissions for all Field Leader levels.

	 	1.	 	One percent (1%) of the first year commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Up to an additional four percent (4%) of the first year
commissions posted to the Participant’s Debit Balance Account in the immediate
preceding month, provided the Participant remains eligible under Section 1.8 of
ACE for a New Horizon Enhancement during the New Horizon Period; plus
	 
	 	3.	 	Twenty percent (20%) of the renewal commissions posted to the
Participant’s Debit Balance Account in the immediate preceding month.

     This Addendum is effective as of September 1, 2008.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	HealthMarkets, Inc.	 	 	 	Cornerstone America, a division of Mid-West	 	 
	 	 	 	 	National Life Insurance Company of Tennessee	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Printed Name:	 	 	 	 	 	 	 	Printed Name:	 	 	 	 
	 

	 	Title: 
	 	 	 	 	 	 	 	Title:	 	 	 	 
	 

	 	
	 	 	 	 	 	
	 	 

27

 

HealthMarkets, Inc.

Agent’s Contribution to Equity Plan

ACE

Contribution Addendum

	 	 	 
	Participating Agency:

	 	Success Driven Awards, Inc.
	 

	 	c/o HealthMarkets
	 

	 	9151 Boulevard 26
	 

	 	North Richland Hills, Texas 76180

     In accordance with Sections 1.8 and 4.1 of ACE, each Participant’s Base Monthly Contribution
shall be calculated as a percentage of such Participant’s field services representative
compensation (“FSR Compensation”), as set forth below; provided that a Participant’s Base Monthly
Contribution shall never exceed $2,000 ($3,000 during the New Horizon Period, subject to the
conditions of Section 1.8 of ACE) in the aggregate from commissions and/or compensation received
from all Participating Agencies.

	 	A.	 	FSR Compensation from personal production.

	 	1.	 	One percent (1%) of the first year FSR Compensation posted to
the Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Up to an additional four percent (4%) of the first year FSR
Compensation posted to the Participant’s Debit Balance Account in the immediate
preceding month, provided the Participant remains eligible under Section 1.8 of
ACE for a New Horizon Enhancement during the New Horizon Period; plus
	 
	 	3.	 	Twenty-five percent (25%) of the renewal FSR Compensation
posted to the Participant’s Debit Balance Account in the immediate preceding
month.

	 	B.	 	Override FSR Compensation for all Field Leader levels.

	 	1.	 	One percent (1%) of the first year FSR Compensation posted to
the Participant’s Debit Balance Account in the immediate preceding month; plus
	 
	 	2.	 	Up to an additional four percent (4%) of the first year FSR
Compensation posted to the Participant’s Debit Balance Account in the immediate
preceding month, provided the Participant remains eligible under Section 1.8 of
ACE for a New Horizon Enhancement during the New Horizon Period; plus
	 
	 	3.	 	Twenty percent (20%) of the renewal FSR Compensation posted to
the Participant’s Debit Balance Account in the immediate preceding month.

     This Addendum is effective as of September 1, 2008.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	HealthMarkets, Inc.	 	 	 	Success Driven Awards, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Printed Name:	 	 	 	 	 	 	 	Printed Name:	 	 	 	 
	 

	 	Title: 
	 	 	 	 	 	 	 	Title:	 	 	 	 
	 

	 	
	 	 	 	 	 	
	 	 

28

 

     6. The terms of ACE, as amended and supplemented hereby, are confirmed in all respects and
remain in full force and effect.

     7. This Fourth Amendment is effective as of September 1, 2008.

	 	 	 	 	 
	 	HealthMarkets, Inc.

 	 
	 	By:  	 	 
	 	 	Name:  	Peggy
G. Simpson	 
	 	 	Its: 	Corporate Secretary	 
	 

29

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