INCENTIVE PLAN DESIGN

·         Reward performance.

·         Encourage teamwork.

·         Create a high performance culture.

·         Focus everyone on what’s important to the success of the company.

·         Employees with employment date on or before January 1 and employed on December 31 of the plan year.

·         Agents at Associate, Partner or Senior Partner level.

·         Employees on probation status are excluded.

Nodak Mutual Group must achieve a net underwriting gain and the Return on Equity must equal or exceed 5.0% or no compensation is paid.

·         Total of five goals:

1.        Financial Strength

2.        Retention

3.        Growth (Life/New Policies/Units/Inforce Policies)

4.        Loss Ratio

5.        Expense Ratio

·         Agents

o         Eligibility and details are contained in the Agent Recognition Program.

·         Eligible Employees*

o         Employees, hired on or before January 1, are eligible to receive 2% for each goal achieved multiplied by their earned salary for the calendar year (does not include bonuses or any other compensation) multiplied by the bonus percentage based upon the table below.

o     Employees hired after January 1 and prior to July 1 of the plan year are eligible to receive 1% for each goal achieved multiplied by the earned salary for the calendar year (does not include bonuses or any other compensation) multiplied by the bonus percentage based upon the table above.

o     Employees hired after July 1 are not eligible until the following year.

*CEO – 15% per goal, CFO & VP Operations = 10% per goal, Director/Manager Level = 4% per goal, All Other = 2% per goal