Employment Agreement dated November 15, 2018, between Federal Life Group, Inc., Federal Life Insurance Company, and Michael Austin

Exhibit 10.3

EMPLOYMENT AGREEMENT

FOR THE

EXECUTIVE VICE PRESIDENT AND

CHIEF MARKETING OFFICER

November 15, 2018

EXECUTIVE AGREEMENT

Agreement made this 15th day of November 2018 between FEDERAL LIFE GROUP, INC., a Pennsylvania corporation, FEDERAL LIFE INSURANCE COMPANY, an Illinois stock life insurance company, and any subsidiaries or affiliates (hereinafter referred to as the “Corporation”) and MICHAEL AUSTIN (hereinafter sometimes referred to as the “Executive Vice President”).

Michael Austin was presently employed by the Federal Life Insurance Company as its Executive Vice President and Chief Marketing Officer pursuant to an executive agreement dated March 3, 2010 (the “Prior Employment Agreement”).

The Board of Directors of the Corporation desires to provide for the continued employment of the Executive Vice President which the Board has determined will be in the best interests of the policyholders of Federal Life Insurance Company and the Corporation and will enforce and encourage the continued attention and dedication of the Executive Vice President to the Corporation. The Executive Vice President is willing to commit himself to continue to serve the Corporation on the terms and conditions herein provided.

In order to effect the foregoing, the Corporation and the Executive Vice President wish to enter into an agreement on the terms and conditions set forth below.

Accordingly, in consideration of the promises and the respective covenants and agreements herein contained, in further consideration of services performed and to be performed by the Executive Vice President and intending to be legally bound, the parties hereto agree as follows:

The initial term of employment, as this phrase is used throughout this Agreement, shall be for the period beginning on the date of this Agreement and ending three (3) years thereafter consistent with the provisions of Chapter 215 ILCS 5/245, as it exists at the time this Agreement is executed. This Agreement is automatically extended each day for an additional day except that a notice of non-extension may be given at any time by the Board of Directors of the Corporation in which case the term of employment will expire at the end of its then current term.

The Executive Vice President shall devote his full business time (with allowances for vacations and sick leave) and attention and best efforts to the affairs of the Corporation during the term of employment; provided, however, that he may serve as a director of other corporations and entities and may engage in other activities to the extent that they do not inhibit the performance of his duties hereof or conflict with the business of the Corporation.

The Executive’s base salary shall be Two Hundred Forty-Five Thousand Eight Hundred Sixty-One Dollars ($245,861). The Executive Vice President’s base salary will be determined each year by the Corporation’s Board of Directors Compensation Committee at its annual meeting (but shall not be less than the amount set forth herein) and will be paid in substantially equal monthly installments plus a bonus determined annually by the Compensation Committee based upon determination of the Compensation Committee as to the performance of the Executive Vice President. Any annual increase to the base salary shall become the base salary as set forth herein.

In addition to the compensation provided for herein, the Executive Vice President shall be entitled to participate in any and all employee benefit programs of the Corporation as currently in effect. Further, the Executive Vice President shall be entitled to receive prompt reimbursement for all expenses which he deems reasonably incurred by him in performing services hereunder provided such expenses are incurred and accounted for in accordance with the policies and procedures presently established by the Corporation.

If the Corporation shall terminate the Executive Vice President’s employment during the term of employment for other than a material breach of this Agreement or “just cause”, as herein defined, the Executive Vice President shall have no obligation to seek other employment in mitigation of damages in respect of any period following the date of such termination and the Executive Vice President shall be entitled to receive from the Corporation the full base salary to which he is then entitled to the end of the term of employment which shall be payable to the Executive Vice President in monthly installments without regard to, or reduction because of, any other compensation or income which the Executive Vice President receives or is entitled to receive whether from the Corporation or otherwise. It is stipulated that any payments made in accordance with the foregoing shall be paid to and received by the Executive Vice President as liquidated damages for the unwarranted termination of his employment and not as penalties and he shall be entitled to receive no further sums under this Agreement except as such that have accrued as of the date of termination or as otherwise specifically provided in this Agreement. In view of the fact that the term of this Agreement is for three (3) years pursuant to the provisions of the aforesaid described Chapter 215 ILCS 5/245, it is contemplated that the payments provided to be made by virtue of this provision shall be completed at the expiration of three (3) years from the date of such termination.

It is further understood that coverage under the Home Office Employees’ Group Health Plan during the period when payments are being made under this paragraph or Paragraph 7C will continue at the same price as if employment had continued.

“Just cause” shall mean willful misconduct, dishonesty, conviction of (or plea of nolo contendere to) a felony, habitual drunkenness or excessive absenteeism not related to illness. Should the Executive Vice President’s employment be terminated by the Corporation for a material breach of this Agreement or for “just cause”, the Corporation shall be obligated to pay the Executive Vice President his then base salary only through the end of the month during which such termination occurs plus such other sums as are payable to the Executive Vice President under this Agreement and which have accrued as of the end of such month.

The termination of employment of the Executive Vice President shall not be deemed to be for “Just cause” unless and until there shall have been delivered to the Executive Vice President a copy of a resolution duly adopted by the affirmative vote of not less than 66% of the entire membership of the Corporation’s Board (excluding the Executive Vice President) at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive Vice President and the Executive Vice President is given an opportunity, together with counsel, to be heard before the Board) finding that, in the good faith opinion of the Board, the Executive Vice President is guilty of the conduct described above, and specifying the particulars thereof in detail.

Without prejudice to the provisions of Paragraph 1B of this Agreement, it is agreed that if during the term of employment the Executive Vice President resigns employment for “Good Reason”. Any such resignation shall not be deemed to be a material breach by the Executive of this Agreement.

The term “Good Reason” shall mean (i) a material diminution in salary, (ii) a material diminution in authority, duties or responsibilities, or (iii) a reassignment which assigns full-time employment duties to Executive Vice President at a location more than fifty (50) miles from the Corporation’s principal executive office on the date of this Agreement, in all cases after notice from Executive Vice President to the Corporation within ninety (90) days after the initial existence of any such condition that the condition constitutes Good Reason and the failure of the Corporation to cure such situation within thirty (30) days after said notice.

It is further agreed that upon such resignation, except for obligations of either party to the other which have accrued as of the date of the Executive Vice President’s resignation or as otherwise specifically provided in this Agreement, the Executive Vice President shall be entitled to receive the compensation provided under Paragraph 7A of this Paragraph 7 as if such termination was by the Corporation other than for material breach or other just cause. It is provided, however, that the Executive Vice President’s obligation of non-disclosure as provided in Paragraph 11 of this Agreement shall remain undiminished and in full force and effect and the obligation of the Executive Vice President under Paragraph 8 of this Agreement not to compete shall continue for the period during which payments continue to be made to the Executive Vice President under the provisions of Paragraph 7A.

It is further understood that the foregoing shall not foreclose the Corporation’s Board of Directors Compensation Committee from voting to continue the compensation of the Executive Vice President to his widow for a reasonable period after his death.

In the event of disability of the Executive Vice President during the period of employment, the Executive Vice President shall be entitled to the base salary provided of in Paragraph 4 above at the rate being paid at the time of the commencement of disability for the first nine (9) month period of such disability. Thereafter, the Executive Vice President shall receive fifty percent (50%) of such rate being paid at the time of the commencement of disability for the remaining term provided for in this Agreement; provided, however, that this Agreement after the expiration of the nine (9) month period shall be reduced by any payments to which the Executive Vice President may be entitled for the payment period because of disability under any disability plan of the Corporation.

Any successor or assign (whether direct or indirect by purchase, merger, consolidation or change of control) shall absolutely and unconditionally assume and agree to perform this Agreement in the same manner and to the same extent that the Corporation would be required to perform it if no succession or assignment had taken place. The Corporation agrees that it will require any successor, or assign, under the circumstances herein above set forth, to expressly, absolutely and unconditionally assume and agree to perform this Agreement. Any failure of the Corporation to obtain such agreement prior to the effectiveness of any such succession or assignment shall be a material breach of this Agreement and shall entitle the Executive Vice President to terminate under the provisions of Paragraph 7A. As used in this Paragraph, the Corporation shall mean the Federal Life Group, Inc., Federal Life Insurance Company and any successor of their business and/or assets as aforesaid which executes and delivers the Agreement Page 7 provided for in this Paragraph or which otherwise becomes bound by the terms and conditions of this Agreement by operation of law.

This Agreement shall inure to the benefit of and be enforceable by the Executive Vice President’s legal representative, executors, administrators, successors, heirs, devisees, designees and legatees. If the Executive Vice President should die while any amounts are still payable to him hereunder such amounts unless otherwise provided for herein shall be paid in accordance with the terms of this Agreement to the Executive Vice President’s devisees, legatees, or other designees, or, if there be no such designees, to the Executive Vice President’s estate.

The Executive Vice President agrees that he shall not at any time while receiving compensation from the Corporation disclose or use, except in the course of his employment with the Corporation in the pursuit of the business of the Corporation, any confidential information or proprietary data of the Corporation whether such information or proprietary data is in his memory or embodied in writing or other physical form.

Any paragraph, sentence, phrase or other provision of this Executive Employment Agreement which is in conflict with any applicable statute, rule or other law shall be deemed, if possible, to be modified or altered to conform thereto or, if not possible, to be omitted here from. The invalidity of any portion hereof shall not affect the form and effect of the remaining valid portions hereof. Paragraph headings are included herein for convenience and are not intended to affect in any way the interpretation of any remaining paragraphs of this Agreement.

This Executive Employment Agreement is governed by and is to be construed in accordance with the laws of the State of Illinois.

All notices shall be in writing and shall be deemed effective when delivered in person, or 48 hours after deposit thereof in the U.S. mails, postage pre-paid, for delivery as registered mail, return-receipt requested, addressed in the case of the Executive Vice President to his last known address as carried on the personnel records of the Corporation to the corporate headquarters to the attention of the President and Chief Executive Officer thereof or to such other address as the parties to be notified may specify by notice to the other party.

The Corporation represents and warrants that the execution of this Agreement by the Corporation has been duly authorized by resolution of their Board of Directors.

No provision of this Agreement may be modified, waived or discharged unless such modification, waiver or discharge is agreed to in writing signed by the Executive Vice President and the Corporation. No waiver by either party hereto at any time by any breach of any part hereto of any compliance with any conditions or provisions of this Agreement to be performed by such party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

This Section 18(D) should not be construed to prevent the application of Treas. Reg. § 1.409A-1(b)(9)(iii)(or any successor provision) to amounts payable hereunder (or any portion thereof).

IN WITNESS WHEREOF, the Company and the Corporation, by order of their Board of Directors, has caused this Agreement, consisting of eleven (11) pages, to be signed in its corporate name by its duly authorized Director and impressed with its corporate seal, attested by its Secretary and the Director has hereunto set his hand on the day and year first above written.