I believe as a loyalist you also lose some portion of your loyalty points when you break contract. I'll try to find the actual data on this...
Desertion
Breaking the oath of Loyalty to your Faction will mark you as a Deserter for a period of 7 days. Once you make the decision to desert your Faction it cannot be reversed.
During the Desertion Phase you:
• Will remain under the banner of your Faction until the end of the Desertion Phase.
• Will not be eligible for participating in War Planning.
•
Will lose 25% of the Loyalty Points you have accumulated with the Faction you are deserting.
• Will not receive any Loyalty Points from Missions for your Faction.
• Will receive a 25% reduction to C-Bill earnings from Missions for your Faction.
If you decide to pledge Loyalty to that Faction again in the future, you will start your Rank progression from where you left off after the 25% LP reduction.
http://mwomercs.com/...pr2016#loyalist
Section above (underlining added) is lifted from the phase 3 patch notes (about a third of the way down on the linked page). I do not believe that this has changed since its introduction.
Edited by Bud Crue, 16 December 2016 - 05:29 AM.