Amended And Restated Employment Agreement

Amended and Restated Employment Agreement




                                  Exhibit 10.3
                                  ------------

Amendment No. 1 dated May 17, 1999 to Amended and Restated Employment Agreement
                             for Margery G. Hughes




                                 AMENDMENT NO. 1

                                       TO

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT

         THIS AMENDMENT NO. 1 TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the
"Amendment") is executed as of May 17, 1999 by and between Life USA Holding,
Inc., a Minnesota corporation (the "Company") and Margery G. Hughes (the
"Executive").

                                R E C I T A L S:

         WHEREAS, the Company and Executive are parties to that certain Amended
and Restated Employment Agreement dated as of January 1, 1998 (the "Agreement");

         WHEREAS, Allianz Life Insurance Company of North America, a Minnesota
corporation ("Parent"), and the Company have agreed to enter into an Agreement
and Plan of Merger, dated as of May 17, 1999 (the "Merger Agreement"), pursuant
to which a wholly owned subsidiary of Parent will be merged with and into the
Company and the Company will become a wholly owned subsidiary of Parent (the
"Merger"); and

         WHEREAS, as a material condition and inducement to Parent's execution
of the Merger Agreement, the Executive and the Company have agreed to enter into
this Amendment.

         NOW, THEREFORE, in consideration of the mutual premises and agreements
set forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

         1. Amendment. Effective as of the date hereof, Section 4(k) of the
Agreement is hereby amended by inserting the following text immediately
following the last sentence of Section 4(k):

                  Notwithstanding the foregoing provisions of this Section 4(k),
                  a "Change of Control" shall not be deemed to have occurred
                  with respect to any of the following:

                           (a)      the execution of this Agreement;

                           (b) the acquisition by Allianz Life Insurance Company
                  of North America or any of its direct or indirect subsidiaries
                  or affiliates (collectively, "Allianz") of all or
                  substantially all of the voting securities, business or assets
                  of the Company or the merger of Allianz with and into the
                  Company (or the merger of the Company with and into Allianz);




                           (c) any change in the membership of the Board of
                  Directors of the Company in connection with, or the approval
                  of the stockholders of the Company of, any action under item
                  (b) above; or

                           (d) the execution of any agreement contemplated by
                  that certain Agreement and Plan of Merger executed between
                  Allianz Life Insurance Company of North America, Nova New Co.
                  and the Company.

         2. Additional Amendments. Effective immediately upon the effectiveness
of the Merger:

                  (a) the second sentence of Section 1 of the Agreement is
hereby amended and restated in its entirety to read as follows:

                  In discharging such duties and responsibilities, the Executive
                  may also serve as an executive officer and/or director of any
                  direct or indirect subsidiary of the Company (collectively the
                  "Subsidiaries", and together with any direct or indirect
                  parent of the Company and any other direct or indirect
                  subsidiary of any such parent, collectively the "Affiliates")
                  or of any Affiliate.

                  (b) Section 3(c) is hereby deleted in its entirety.

                  (c) each instance of the phrase "its Subsidiaries" in Sections
4(b), 5(a), 5(b), and 5(c) of the Agreement is hereby deleted and replaced with
the phrase "its Affiliates".

                  (d) each instance of the phrase "the Subsidiaries" in Sections
4(b), 5(b), 5(c) and 5(d) of the Agreement is hereby deleted and replaced with
the phrase "its Affiliates".

                  (e) the first sentence of Section 4(c) of the Agreement is
hereby amended and restated to read in its entirety as follows:

                           (c) Termination for Good reason by the Executive. By
                  following the procedure set forth in paragraph 4(e), the
                  Executive shall have the right to terminate the Executive's
                  employment with the Company for "Good Reason" in the event (i)
                  the Executive is not at all times a duly elected President and
                  Chief Operating Officer of the Company or a holder of a
                  comparable title with an Affiliate; (ii) there is any material
                  reduction in the scope of the Executive's authority and
                  responsibility (provided, however, that the transfer of the
                  Executive to a position of substantially similar authority and
                  responsibility with an Affiliate shall not constitute a
                  "material reduction" in the scope of Executive's authority and
                  responsibility hereunder); (iii) there is a reduction in the
                  Executive's Base Salary, a material reduction in the amount of
                  Annual Bonus for which the Executive is eligible, an amendment
                  to any employee retirement plan applicable to the Executive
                  which is materially adverse to the Executive, 




                  or a material reduction in the other benefits to which the
                  Executive is entitled under paragraph 3(e) above; (iv) the
                  Company requires the Executive's principal place of employment
                  to be anywhere other than the Company's or an Affiliate's
                  principal executive offices, or there is a relocation of such
                  principal executive offices outside of the Minneapolis/St.
                  Paul, Minnesota metropolitan area; or (v) the Company
                  otherwise fails to perform its obligations under this
                  Agreement.

         3. Full Force and Effect. Except as expressly set forth herein, the
Agreement as amended hereby shall continue in full force and effect in
accordance with its terms.

         4. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which, when so executed and delivered, shall be deemed to be an original and all
of which taken together shall constitute but one and the same instrument.

         5. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Minnesota, without regard to the
principles thereof regarding conflict of laws.






         IN WITNESS WHEREOF, the parties have executed this Agreement, each as
of the date first above written.



                                      LIFE USA HOLDING, INC.



                                      By  /s/ Robert W. MacDonald
                                          --------------------------------------

                                      Its Chairman and Chief Executive Officer
                                          --------------------------------------

                                      /s/ Margery G. Hughes
                                      ------------------------------------------
                                      Margery G. Hughes