GUARANTY AGREEMENT
THIS
GUARANTY AGREEMENT (the "Guaranty") is made and given this 29th day
of
December, 2005, by
SECURITY NATIONAL LIFE INSURANCE COMPANY, a Utah domiciled
insurance company,
and its wholly-owned subsidiary, SOUTHERN SECURITY LIFE
INSURANCE COMPANY,
a Florida domiciled
insurance company
(collectively,
the
"Guarantors").
WITNESSETH:
WHEREAS, on September 23, 2005, Security National Financial
Corporation, a
Utah corporation,
through its
subsidiaries,
Security National Life
Insurance
Company and Southern
Security Life Insurance Company, entered into a stock
purchase agreement
(the "Stock Purchase
Agreement")
with Memorial
Insurance
Company of America, an Arkansas domiciled insurance company
("Memorial Insurance
Company");
WHEREAS, under the terms of the Stock Purchase Agreement, Southern
Security
Life Insurance Company and Memorial Insurance Company each agree at
the closing
date of the stock purchase transaction to enter into a reinsurance
agreement to
reinsure all of the in force business of Memorial Insurance Company to Security
National Life
Insurance Company,
as insured,
except for eleven
policies not
included within the
reinsured policies, which are to be retained by
Memorial
Insurance Company (the "Retained Policies");
WHEREAS, the
Retained Policies that are to be retained by Memorial
Insurance Company
pursuant to the terms of the stock purchase transaction
consist of the following policies, together with the face amount and
amount of
reserves of such policies:
Policy
Face
Number
Amount
SAP Reserve
------
----------
-----------
40116
$1,400.00
$665.50
37893
1,400.00
665.50
40117
1,200.00
374.72
39303
1,200.00
374.72
34758
700.00
557.46
38161
1,300.00
406.95
39301
2,600.00
1,090.88
32025
3,500.00
1,984.97
36085
1,400.00
744.95
34759
700.00
576.04
44711
1,400.00
1,102.01
----------
---------
Total $16,800.00
$8,543.70
==========
=========
WHEREAS, on October
20, 2005, Security National Life Insurance Company and
Southern Security Life
Insurance Company
submitted to the
Arkansas Insurance
Department for
approval a Form A
Filing for the
Acquisition
and Control of
Memorial Insurance Company by Southern Security Life Insurance
Company, in which
the filing
included a proposed reinsurance agreement (the "Reinsurance
Agreement") that Security National Life Insurance Company
intends to enter into
with Memorial
Insurance Company at the closing date of the stock purchase
transaction;
WHEREAS, as a condition to the Arkansas Insurance Department approving the
Form A filing, Security National Life Insurance Company has agreed
to enter into
a guaranty agreement with Memorial Insurance Company, in a form acceptable to
the department, to
guaranty the benefit
payments stated in the eleven Retained
Policies as a result
of the Reinsurance
Agreement to be entered into at the
closing date of the stock purchase transaction; and
WHEREAS, Security
National Life
Insurance Company desires to enter into a
guaranty agreement
to guaranty
the benefit
payments stated in the Retained
Policies to be retained by Memorial Insurance Company following the
completion
of the stock purchase transaction and the execution of the Reinsurance
Agreement;
NOW,
THEREFORE,
in respect of the foregoing, Security National Life
Insurance Company and Southern Security Life Insurance Company, as guarantors,
represent and warrant as follows:
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1. The Guara
