EXHIBIT 10(bw)
National Western Life
Insurance Company
2009 EXECUTIVE OFFICER BONUS
PROGRAM
The Bonus
Program (“Program”) is designed to reward the Chairman
of the Board/Chief Executive Officer and the President/Chief
Operating Officer 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 15% for sales performance, 15% for
expense management performance, and 20% for profitability, or an
overall par percentage of 50%. 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 50%.
The sales
component of the Program is further subdivided between Life
production and Annuity production. For 2009, the bonus sales goals
are:
|
●
|
International
Life -- $27,000,000 net placed annualized target premium
|
|
●
|
Domestic Life
-- $7,700,000 net placed annualized target premium
|
|
●
|
Annuities --
$382,500,000 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 2009 will be applied to 100% of the executive
officer’s base salary in accordance with the following
grid:
|
Intl Life
|
|
Domestic
|
|
Annuities
|
|
|
Placed
|
Bonus
|
Life Placed
|
Bonus
|
Placed
|
Bonus
|
|
Target
|
%
|
Target (1)
|
%
|
Premium
|
%
|
|
$23,100,000
|
|
$6,200,000
|
|
$309,800,000
|
|
|
$25,000,000
|
|
$6,900,000
|
|
$344,200,000
|
|
|
$27,000,000
|
|
$7,700,000
|
|
$382,500,000
|
|
|
$29,000,000
|
|
$8,400,000
|
|
$420,800,000
|
|
|
$31,200,000
|
|
$9,300,000
|
|
$462,800,000
|
|
(1) Does not
include California 1 st Year Premium.
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 15% (5%
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 $27.0 million in International
Life sales, $7
|
