Document:

exhibit10bq.htm

    

      EXHIBIT
10(bq)

      

      National Western Life
Insurance Company

      2008 EXECUTIVE OFFICER BONUS
PROGRAM

      

      

      The Bonus
Program (“Program”) is designed to reward selected executive officers for their
performance in assisting the Company in achieving pre-determined sales targets
while managing to profit criteria. The Plan incorporates three measurable
performance factors: (1) sales, which are defined as net placed annualized
target premium for Life business and as total placed premium for Annuity
business, (2) expense management, and (3) overall Company
profitability.

      

      Each of
the above performance factors will have an assigned target level for purposes of
the Program. Assuming a “par” performance (i.e. achieving each target level),
the weighting of the bonus (applied to base salary) is 10% for sales
performance, 10% for expense management performance, and 10% for profitability,
or an overall par percentage of 30%. Actual results compared to the targets can
either increase or decrease each of these individual percentages as explained in
the following sections. However, the total bonus percentage cannot exceed
30%.

      

      Sales
Component:

      

      The sales
component of the Program is further subdivided between Life production and
Annuity production. For 2008, the bonus sales goals are:

      

      
        	
                Ø  

              	
                International
      Life -- $34,900,000 net placed annualized target
  premium

              

      

      
        	
                Ø  

              	
                Domestic
      Life -- $12,200,000 net placed annualized target
  premium

              

      

      
        	
                Ø  

              	
                Annuities
      -- $485,000,000 net placed total
premium

              

      

      

      The New
Business Market Summary Report (NWAR60) will be the source of sales results for
purposes of this Program. Based upon these sales goals, the bonus percentage
corresponding with each sales production levels achieved in 2007 will be applied
to 100% of the executive officer’s base salary in accordance with the following
grid:

       

      
        

        
          	
                  Intl Life 

                  Placed
      Target

                	
                  Bonus 

                  %

                	
                  Domestic Life
      

                  Placed
      Target

                	
                  Bonus

                  %

                	
                  Annuities Placed
      

                  Premium

                	
                  Bonus 

                  %

                
	
                  $30,900,000

                	
                  2.00%

                	
                  $11,000,000

                	
                  2.00%

                	
                  $430,000,000

                	
                  2.00%

                
	
                  $32,900,000

                	
                  2.50%

                	
                  $11,600,000

                	
                  2.50%

                	
                  $455,000,000

                	
                  2.50%

                
	
                  $34,900,000

                	
                  3.34%

                	
                  $12,200,000

                	
                  3.33%

                	
                  $480,000,000

                	
                  3.33%

                
	
                  $36,900,000

                	
                  4.00%

                	
                  $12,800,000

                	
                  4.00%

                	
                  $505,000,000

                	
                  4.00%

                
	
                  $38,900,000

                	
                  5.00%

                	
                  $13,400,000

                	
                  5.00%

                	
                  $530,000,000

                	
                  5.00%

                

        

         

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      The level
shaded in gray represents the Company’s sales goals for each segment for
purposes of the bonus program and represents the par performance level. If the
actual results attain this level, the executive officer would be eligible to
receive a bonus of 10% (3.33% for each line of business) of base
salary.

      

      Expense Management
Component:

      

      The
expense component of the program is based upon a ratio of actual expenses to a
sales unit of production. For purposes of this ratio, the sales unit of
production will be based upon target premium. Annuity sales target premium will
be assumed to be equal to 7.5% of total placed annuity premium.

      

      Assuming
“par” sales goals of $34.9 million in International Life sales, $12.2 million in
Domestic Life sales, and $480 million in total annuity sales, the par sales
production for purposes of the expense management component is $83.1 million.
The submitted expense budget based upon these sales goals is approximately $47
million. Accordingly, the par ratio of expenses to sales production is roughly
57%. Based upon this relationship, the bonus percentage corresponding with the
actual expense ratio achieved in 2008 will be applied to 100% of each executive
officer’s base salary in accordance with the following grid:

       

      
        

        
          	
                  Expense/Sales
      Ratio

                	
                  Bonus
  %

                
	
                  63%

                	
                  6.00%

                
	
                  60%

                	
                  8.00%

                
	
                  57%

                	
                  10.00%

                
	
                  54%

                	
                  11.00%

                
	
                  51%

                	
                  12.00%

                

        

         

      

      For
purposes of the expense component, marketing and executive officer bonuses will
be excluded. In addition, special consideration may be given at the discretion
of the  Compensation and Stock Option Committee of the Board of
Directors (“Compensation Committee”) for items of an unusual and/or
non-recurring nature (i.e. excess pension contributions) that are beyond the
control of Company management.

      

      Company Profitability
Component:

      

      The
profitability component of the program is based upon GAAP operating earnings as
a percentage of beginning stockholders’ equity. GAAP operating earnings are net
of federal income taxes and exclude realized gains and losses on investments.
The amounts used for purposes of the bonus calculation will be the figures
audited by the Company’s independent auditors.

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      The bonus
percentage corresponding with the actual GAAP operating earnings achieved in
2008 relative to beginning of the year stockholders’ equity will be applied to
100% of each executive officer’s base salary in accordance with the following
grid:

       

        
          	
                  GAAP
      Profitability

                	
                  Bonus
  %

                
	
                  7.5%
      of Stockholders’ Equity

                	
                  6.00%

                
	
                  8.5%
      of Stockholders’ Equity

                	
                  8.00%

                
	
                  9.5% of Stockholders’
      Equity

                	
                  10.00%

                
	
                  10.5%
      of Stockholders’ Equity

                	
                  11.00%

                
	
                  11.5%
      of Stockholders’ Equity

                	
                  12.00%

                

        

         

      

      Example:

      

      Assume
the following results for 2008:

      
         

        
          	
                  Ø  International
      Life placed target premium sales

                	
                  $

                	
                  35,000,000

                
	
                  Ø  Domestic
      Life placed target premium sales

                	
                  $

                	
                  13,000,000

                
	
                  Ø  Annuity
      placed total premium sales

                	
                  $

                	
                  435,000,000

                
	
                  Ø  Actual
      budget center expenses

                	
                  $

                	
                  47,500,000

                
	
                  Ø  GAAP
      operating earnings

                	
                  $

                	
                  85,000,000

                
	
                  Ø  Beginning
      GAAP stockholders’ equity

                	
                  $

                	
                  975,000,000

                

        

         

      

      Based upon the above charts, the executive officer’s 2008 bonus
would be calculated as follows:

      

      Sales
Component

      

      

      
        	 
      	
                International
      Life sales bonus %

              	 
      	
                3.34%

              
	 
      	
                Domestic
      Life sales bonus %

              	 
      	
                4.00%

              
	 
      	
                Annuity
      sales bonus %

              	 
      	
                2.00%

              
	 
      	
                Total
      sales bonus %

              	 
      	
                9.34%

              

      

      
        

        Expense Management
Component

      

      

      
        	 
      	
                Actual
      budget center expenses

              	
                $

              	
                47,500,000

              
	 
      	 
      	 
      	 
      
	 
      	
                Sale
      Production Amount:

              	 
      	 
      
	 
      	
                  International
      Life target premium

              	
                $

              	
                35,000,000

              
	 
      	
                  Domestic
      Life target premium

              	 
      	
                13,000,000

              
	 
      	
                  Annuity
      target ($435m @ 7.5%)

              	 
      	
                32,625,000

              
	 
      	 
      	
                $

              	
                80,625,000

              
	 
      	 
      	 
      	 
      
	 
      	
                Ratio
      of Actual/Sales Production

              	 
      	
                58.9%

              
	 
      	
                Expense
      management bonus %

              	 
      	
                8.0%

              

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        
          

          Company Profitability
Component

        

      

      

      
        	 
      	
                GAAP
      operating earnings

              	
                $

              	
                85,000,000

              
	 
      	
                Beginning
      stockholders’ equity

              	
                $

              	
                975,000,000

              
	 
      	 
      	 
      	 
      
	 
      	
                Ratio
      of earnings/equity

              	 
      	
                8.72%

              
	 
      	
                Company
      profitability bonus

              	 
      	
                8.00%

              

      

      
        
          

          Total Bonus
%

        

      

      

      
        	 
      	
                Sales
      component

              	 
      	
                9.83%

              
	 
      	
                Expense
      management component

              	 
      	
                8.00%

              
	 
      	
                Company
      profitability component

              	 
      	
                8.72%

              
	 
      	 
      	 
      	
                26.55%

              

      

      

      Administration:

      

      Bonus
amounts under the program will be earned and paid at the end of the Company’s
calendar year upon the availability of audited GAAP financial statements. The
Company’s independent auditors will also review the calculation of the bonus %
for compliance with the details of this Program as part of the Company’s audited
financial statements.

      

      If
employment with the Company is terminated for any reason other than “termination
for cause” by NWL, the bonus amount paid at termination will be based upon the
pro rated percentage of the calendar year that services were rendered to the
Company. In the event of death, the bonus amount will be paid to the
individual’s spouse, and if the individual’s spouse is also not living at that
time, then to the individual’s children.

      

      Participants
in the Program are designated by the Compensation Committee. The Program, its
terms, and its administration are at the complete discretion of the Compensation
Committee and may be changed or revoked at any time without the consent of the
participants. This includes, among other things, amendment of the terms,
targets, and other features of the Program as the Compensation Committee sees
fit. Accordingly, this Program does not constitute a legal and binding
obligation of the Company to perform.

      

      

      

      

      

      

      

      

      February
2008exh10_17.htm

    
      

    

    M A N A G E
M E N T   A G R E E M E N T

    

    

    

    

    
 

    
      
        

        
          	
                  OWNER:

                	 
      	
                  REGENCY
      NORTH ACQUISITION, LLC

                
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  AGENT:

                	 
      	
                  MAXUS PROPERTIES,
      INC.

                
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  PREMISES:

                	 
      	
                  REGENCY
      NORTH
      APARTMENTS

                
	 
      	 
      	
                  6024
      N. Jefferson

                
	 
      	 
      	
                  Kansas
      City, MO  64118

                
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  BEGINNING:

                	 
      	
                  November
      1, 2007

                
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                  ENDING:

                	 
      	
                  October
      31, 2012

                

        

        
          
             

          

          
             

            
              

            

          

          
             

          

        

    

    IN CONSIDERATION of the
covenants herein contained, REGENCY NORTH ACQUISITION, LLC (hereinafter
collectively called "Owner@),
and MAXUS PROPERTIES, INC. (hereinafter called AAgent@),
agree as follows:

    

    1.           The
Owner hereby employs the
Agent exclusively to
rent and manage the property known as Regency North Apartments (hereinafter
collectively referred to as the APremises@)
upon the terms and conditions hereinafter set forth, for a term of five (5)
years, commencing on November 1, 2007 and terminating on October 31, 2012 and
thereafter for yearly periods from time-to-time, unless on or before thirty (30)
days prior to the date last above-mentioned, or on or before thirty (30) days
prior to the expiration of any such renewal period, either party hereto shall
notify the other in writing that it elects to terminate this Agreement, in which
case this Agreement shall be thereby terminated on said last mentioned
date.  (See also Paragraph 6.3 below.)

    

    2.           
THE AGENT
AGREES:

    

    2.1         To
accept the management of the Premises, to the extent, for the period, and upon
the terms herein provided, and agrees to furnish the services of its
organization for the rental operation and management of the
Premises.

    

    2.2         To
prepare a monthly statement of receipts and disbursements and to remit, on a
monthly basis, the net cash flow generated by the Premises after payment of all
operating expenses, debt service and escrow payments if applicable, to the
following party:

    

    Maxus
Properties, Inc.

    104
Armour Road

    North
Kansas City, Missouri  64116

    

    In the
event total monthly disbursements are in excess of total monthly receipts, the
Owner shall promptly
provide funds to cover such shortfalls. Nothing contained herein shall obligate
the Agent to advance its
own funds on behalf of the Owner to cover any
shortfalls.

    

    2.3          To
cause all employees of the Agent who handle or are
responsible for the safekeeping of any monies of the Owner to be covered by a
fidelity bond in an amount and with a company determined by the Agent.

    

    3.            
THE OWNER
AGREES:

    

    To give
the Agent the following
authority and powers (all or any of which may be exercised in the name of the
Owner and agrees to
assume all expenses in connection therewith:

    

    3.1          To
advertise the Premises or any part thereof; to display signs thereon and to rent
the same; to cause references of prospective tenants to be investigated; to sign
leases for terms not in excess of one (1) year and to renew and/or cancel the
existing leases and prepare and execute the new leases without additional charge
to the Owner; provided,
however, that the Agent
may collect from tenant all or any of the following:  a late rent
administrative charge, a non-negotiable check charge, credit report fee, a
sub-leasing administrative charge, and/or broker's commission and need
not

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        
account
for such charges and/or commission to the Owner; to terminate tenancies
and to sign and serve such notices as are deemed needful by the Agent; to institute and
prosecute actions to oust tenants and to recover possession of the Premises; to
sue for and recover rent; and, when expedient, to settle, compromise, and
release such actions or suits, or reinstate such tenancies.  Owner shall reimburse Agent for all expenses of
litigation including attorneys' fees, filing fees, and court costs which Agent does not recover from
tenants.  Agent may select the attorney
of its choice to handle such litigation.

    

    

    3.2          To
hire, discharge, and pay all managers, engineers, janitors, and other employees;
to make or cause to be made all ordinary repairs and replacements necessary to
preserve the Premises in its present condition and for the operating efficiency
thereof, and all alterations required to comply with lease requirements, and to
do decorating on the Premises; to negotiate contracts for non-recurring items
not exceeding $5,000.00, and to enter into agreements for all necessary repairs,
maintenance, minor alterations, and utility services; and to purchase supplies
and pay bills.  Agent shall secure the
approval of the Owner
for items, except monthly or recurring operating charges and emergency repairs
in excess of the maximum, if, in the opinion of the Agent, such repairs are
necessary to protect the property from damage or to maintain services to the
tenants as called for by their tenancy.

    

    3.3          To
collect rents and/or assessments and other items due or to become due and give
receipts therefore and to deposit all funds collected hereunder in the Agent's custodial
account.

    

    3.4           Agent agrees to collect all
tenant security deposits.  Owner instructs Agent to deposit all security
deposits in the general operating account of the property.  Agent is not to segregate the
security deposits into a separate account or into an escrow
account.

    

    3.5          To
execute and file all returns and other instruments and do and perform all acts
required of the Owner as
an employer with respect to the Premises under the Federal Insurance
Contributions Acts, the Federal Unemployment Tax Act and Subtitle C of the
Internal Revenue Code of 1954 with respect to wages paid by the Agent on behalf of the Owner and under any similar
federal and state law now or hereafter in force (and in connection therewith,
the Owner agrees upon
request to promptly execute and deliver to the Agent all necessary powers of
attorney, notices of appointment, and the like).

    

    3.6           The
Agent shall not be
required to advance any monies for the care or management of said property, and
the Owner agrees to
advance all monies necessary therefore.  If the Agent shall elect to advance
any money in connection with the property, the Owner agrees to reimburse the
Agent forthwith and
hereby authorizes the Agent to deduct such advances
from any monies due the Owner.  The Agent, shall, upon instruction
from the Owner, impound
reserves each month for the payment of real estate taxes, insurance, or any
other special expenditure.

    

    
      	
               
      

            	
              4.

            	
              THE
      OWNER FURTHER
      AGREES:

            

    

    

    4.1          To
indemnify, defend, and save the Agent harmless from all suits
in connection with the Premises and from liability for damage to property and
injuries to or death of any employee or other person whomsoever, and to carry at
its own expense public liability, elevator liability (if 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        
elevators
are part of the equipment of the Premises), and workmen's compensation insurance
naming the Owner and
Agent, adequate to
protect their interests in form, substance, and amounts reasonably satisfactory
to the Agent, and to
furnish to the Agent
certificates evidencing the existence of such insurance.  Unless the
Owner shall provide such
insurance and furnish such certificate within thirty (30) days from the date of
this Agreement, the Agent may, but shall not be
obligated to, place said insurance and charge the cost thereof to the account of
the Owner.  All such
insurance policies shall provide that the Agent shall receive thirty
(30) days' written notice prior to cancellation of the
policy.

    

    

    4.2         To
pay all expenses incurred by the Agent, including, but not
limited to, reasonable attorneys' fees and Agent's costs and time in
connection with any claim, proceeding, or suit involving an alleged violation by
the Agent or the Owner, or both, of any law
pertaining to fair employment, fair credit reporting, environmental protection,
rent control, taxes, or fair housing, including, but not limited to, any law
prohibiting or making illegal, discrimination on the basis of race, sex, creed,
color, religion, national origin, or mental or physical handicap; provided,
however, that the Owner
shall not be responsible to the Agent for any such expenses in
the event the Agent is
finally adjudicated to have personally, and not in a representative capacity,
violated any such law.  Nothing contained herein shall obligate the
Agent to employ counsel
to represent the Owner
in any such proceeding or suit, and the Owner may elect to employ
counsel to represent the Owner in any such proceeding
or suit.  The Owner also agrees to pay
reasonable expenses (or an apportioned amount of such expenses where other
employers of Agent also
benefit from the expenditure) incurred by the Agent in obtaining legal
advice regarding compliance with any law affecting the premises or activities
related thereto.

    

    4.3         To
indemnify, defend, and save the Agent harmless from all
claims, investigations, and suits, or from actions or failures to act of the
Owner, with respect to
any alleged or actual violation of state or federal labor laws, it being
expressly agreed and understood that as between the Owner and the Agent, all persons employed in
connection with the Premises are employees of the Owner, not the Agent.  However, it
shall be the responsibility of the Agent to comply with all
applicable state or federal labor laws.  The Owner's obligation under this
paragraph 4.3 shall include the payment of all settlements, judgments, damages,
liquidated damages, penalties, forfeitures, back pay awards, court costs,
litigation expenses, and attorneys' fees.

    

    4.4         To
give adequate advance written notice to the Agent if the Owner desires that the Agent make payment, out of the
proceeds from the premises, or mortgage indebtedness, general taxes, special
assessments, or fire, steam boiler, or any other insurance
premiums.  In no event shall the Agent be required to advance
its own money in payment of any such indebtedness, taxes, assessments, or
premiums.

    

    5.           THE
OWNER AGREES TO PAY THE
AGENT EACH
MONTH:

    

    5.1         MANAGEMENT:   Owner agrees to pay Agent for the ordinary
management of the Premises: FIVE PERCENT (5.0%) of the
monthly gross receipts from the operation of the Premises during the period this
Agreement remains in full force and effect.  Gross receipts are all
amounts received from the operation of the Premises including, but not limited
to, rents, parking fees, deposits, laundry income, and fees.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    5.2        OTHER
ITEMS OF MUTUAL AGREEMENT:   In the  event  Owner requests and
Agent agrees to perform
services outside  the  scope of ordinary management of the
Premises, the parties will agree to a fee and payment structure for these
services prior to commencement of the work.

    

    6.           IT
IS MUTUALLY AGREED THAT:

    

    6.1         The
Owner expressly
withholds from the Agent
any power or authority to make any structural changes in any building or to make
any other major alterations or additions in or to any such building or equipment
therein, or to incur any expense chargeable to Owner other than expenses
related to exercising the express powers above vested in Agent without the prior
written direction of an authorized representative of Owner.  Agent is
granted the authority to make structural changes or major alterations if such
actions are required because of danger to life or which are immediately
necessary for the preservation and safety of the Premises or the safety of the
occupants thereof or are required to avoid the suspension of any necessary
service to the Premises.

    

    6.2         The
Agent does not assume
and is given no responsibility for compliance of any building on the Premises or
any equipment therein with the requirements of any statute, ordinance, law, or
regulation of any governmental body or of any public authority or official
thereof having jurisdiction, except to notify the Owner promptly or forward to
the Owner promptly any
complaints, warnings, notices, or summonses received by it relating to such
matters.  The Owner represents that to the
best of its knowledge the Premises and such equipment comply with all such
requirements and authorizes the Agent, its representatives,
servants, and employees, of and from all loss, cost, expense, and liability
whatsoever which may be imposed on them or any of them by reason of any present
or future violation or alleged violation of such laws, ordinances, statutes, or
regulations.

    

    6.3         In
the event it is alleged or charged that any building on the Premises or any
equipment therein or any act or failure to act by the Owner with respect to the
Premises or the sale, rental, or other disposition thereof fails to comply with,
or is in violation of, any of the requirements of a constitutional provision,
statute, ordinance, law, or regulation of any governmental body or any order or
ruling of any public authority or official thereof having or claiming to have
jurisdiction there over, and the Agent, in its sole and
absolute discretion, considers that the action or position of the Owner or registered managing
Agent with respect
thereto may result in damage or liability to the Agent, the Agent shall have the right to
cancel this Agreement at any time by written notice to the Owner of its election so to
do, which cancellation shall be effective upon the service of such
notice.  Such notice may be served personally or by registered mail,
on or to the person named to receive the Agent's monthly statement at
the address designated for such person as provided in Paragraph 2.2 above, and
if service by mail shall be deemed to have been served when deposited in the
U.S. Mail.  Such cancellation shall not release the indemnities of the
Owner set forth in
Paragraph 4 and 6.2 above and shall not terminate any liability or obligation of
the Owner to the Agent for any payment,
reimbursement, or other sum of money then due and payable to the Agent hereunder.

    

    7.           This
Agreement may be canceled by Owner before the termination
date specified in Paragraph 1 on not less than thirty (30) days' prior written
notice to the Agent.

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    8.           The
Owner shall pay or
reimburse the Agent for
any sums of money due it under this Agreement for service for actions prior to
termination, notwithstanding any termination of this Agreement.  All
provisions of this Agreement that require the Owner to have insured or to
defend, reimburse, or indemnify the Agent (including, but not
limited to, Paragraphs 4.1, 4.2, and 4.3) shall survive any termination and, if
Agent is or becomes
involved in any proceeding or litigation by reason of having been the Owner's agent, such provisions
shall apply as if this Agreement were still in effect.  The parties
understand and agree that the Agent may withhold funds for
thirty (30) days after the end of the month in which the Agreement is terminated
to pay bills previously incurred but not yet invoiced and to close
accounts.

    

    This
Agreement shall be binding upon the successors and assigns of the Agent and their successors and
assigns of the Owner.

    

    

    IN WITNESS THEREOF, the
parties hereto have affixed or caused to be affixed their respective signatures
effective this __ day of October 2007.

    

    OWNER:

    

    REGENCY
NORTH ACQUISITION, LLC

    

    

    

    By:   /s/ John W.
Alvey                                                          

           By Maxus Realty Trust, Inc.,
Manager

                By John W. Alvey,
Vice President

    

    AGENT:

    

    MAXUS
PROPERTIES, INC.

    

    

    

    By:   /s/ Michael P. McRobert

        Michael P.
McRobert

               
CEO

    

    
 

     

     

     

     

     

     

     

     

    6

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