<PAGE>
EXHIBIT 6.04
COLUMBIA INSURANCE GROUP
[LOGO]
AGENCY
CONTRACT
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Agency Agreement
The parties to this Agency Agreement (this "Agreement") are:
/X/ COLUMBIA MUTUAL INSURANCE COMPANY
/X/ COLUMBIA NATIONAL INSURANCE COMPANY
/ / CITIZENS MUTUAL INSURANCE COMPANY
/X/ PATRONS INSURANCE COMPANY
/ / GREAT PLAINS MUTUAL INSURANCE COMPANY
referred to as "we", "us", "our(s)", or "Company" and
BROOKE CORPORATION
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Agency Name
205 E. STREET
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P 0 BOX 426
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Agency Street Address
PHILLIPSBURG KS 67661
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Agency City, State, Zip Code
48-1009756
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S.S.N. or Federal Tax I.D. Number
/X/ Corporation / / Individual
referred to as "you", "your(s)", "Agent" or "Agency".
THE EFFECTIVE DATE OF THIS AGREEMENT IS April 1, 2000
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It is hereby agreed between the parties as follows:
I. AUTHORITY AND RESPONSIBILITY OF AGENT
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You are hereby authorized to transact business with us as an independent agent
as follows:
A. You are an independent contractor and not an employee of ours. You
shall have exclusive control of the conduct of the agency and the
selection of companies represented.
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B. You may solicit, receive and transmit to us proposals for insurance
contracts which are offered by us and for which commission is
specified in the attached Commission Schedule(s). You agree to comply
with all laws affecting your operations and to maintain valid agent,
agency or broker licenses throughout the term of this Agreement.
C. You may bind the kinds of insurance contracts to which this Agreement
applies as we, in our sole discretion, may authorize in writing from
time to time, and subject to such restrictions as we may establish.
You shall not alter, modify, waive or change any provision or
condition of our insurance contracts, bonds, rates, underwriting or
rating rules or rating plans. You shall mail, deliver or forward to us
copies of all binders, policies, certificates and endorsements issued
by you within seven (7) working days of the effective date of such
binder, policy, certificate or endorsement.
D. You may exercise your authority personally or through your authorized
employees, subject to all applicable statutes and rules and
regulations of the Company.
E. You shall have no authority to appoint sub-agents nor to accept
business from any insurance broker without first obtaining written
consent from us. In the event, that we authorize you to transmit
business obtained from such sub-agents or brokers, the name and
address of such sub-agent or broker shall be clearly identified on the
application for insurance.
F. You may countersign insurance contracts, certificates and
endorsements, but only for the kinds of insurance specified in the
applicable Commission Schedule(s).
G. In accordance with applicable laws, regulations and policy provisions,
you may cancel or non-renew any insurance contract placed by you with
us and, at your request, we will:
1. Cancel any such insurance contract;
2. Decline to renew any such insurance contract;
3. Give advance written notice of nonrenewal to the policyholder
under such insurance contract.
We will cancel or non-renew at your request, only if permitted by
applicable statues.
Nothing in this Agreement shall restrict or interfere with our right, for
any reason, to cancel or non-renew any insurance contract issued by or
through you.
H. You will collect, account, receipt for and pay premiums on business
placed with the company by you, as specified in Section II.
I. We may, at our sole discretion, withdraw, limit or otherwise modify
your authority to submit new or renewal proposals for any or all kinds
of insurance by giving you sixty (60) days written notice, or such
longer period, as may be required by applicable statute.
J. Your authority under this Agreement is subject to restrictions imposed
by law or regulation and our underwriting rules, regulations and such
other instructions, procedures and directives, as we may prescribe or
amend from time to time.
K. You will disclose to us all relevant information known to you
regarding business that you place or propose to place with us. In
addition, you will promptly report to us all relevant loss and claim
information, in any way relating to insurance contracts placed with
us.
L. Any default in your responsibilities to any one of the companies shall
be deemed to be a default with respect to all such companies.
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II. PREMIUM ACCOUNTING AND PAYMENT
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As provided in Section I., paragraph H., you have authority to collect, receipt
for and receive premiums on insurance contracts solicited by you and accepted by
us. You agree that all such premiums, including return premiums, are our
property and that all such funds, less commissions, are held in trust by you in
a fiduciary capacity and shall be properly and promptly remitted to us. You
shall promptly refund to us all unearned commissions on policies which are
cancelled or reduced at the same rate as the commission originally retained or
paid.
Unless otherwise authorized by us in writing, you shall maintain premium monies
in a premium trust bank account which is separate from and not commingled with
your operating funds.
You shall not extend credit to an insured and nothing in this Agreement shall
constitute an authorization for an extension of credit on our behalf.
You agree to expend reasonable efforts to assist the Company in collecting
unpaid premiums or other amounts owed by insureds in connection with policies
written by you.
A. AGENCY BILLED POLICIES
On business placed by you which we do not designate as "direct billed", the
following provisions apply:
1. We will provide you with a monthly account of all premium, returned
premium and commission transactions pertaining to your agency bill
business. Payments shall be directed to such place as we may designate from
time to time. You agree to remit any balance due to us not later than
forty-five (45) days after the end of the month for which such statement
was prepared,
2. Any request from you for flat cancellation of a policy or binder must be
received by us within thirty (30) days of the effective date of coverage;
3. You must promptly notify us of any premium dispute and provide us with
information to enable us to resolve such dispute. Any premium or portion
thereof not disputed in good faith must be remitted to us as provided in
this Agreement.
B. DIRECT BILLED POLICIES
On business placed by you which we designate as "direct billed", the following
provisions apply:
1. We are responsible for billing and collecting all premiums (other than
initial premiums on new business) for such insurance contracts;
2. You shall submit all applications to us and shall collect and remit to us
with each new application, the total premium or partial payment in gross
(without deduction of commissions);
3. We will provide you with a monthly account of all premium, returned premium
and commission transactions pertaining to your "direct billed" business.
Commissions on "direct billed" policies shall be computed in accordance with the
attached Commission Schedule. We will pay you within thirty (30) days after the
end of the month in which those premiums are recorded by us. You agree to remit
any balance due to us not later than forty-five (45) days after the end of the
month for which such statement was prepared.
4. At the same time we mail the billing notice, cancellation or non-renewal
notice to your insured, we will mail you a copy. We will make reasonable effort
to mail you a copy of any other insurance document at the same time it is mailed
to your insured. All such materials will reference your name.
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C. AUDITED POLICIES
On policies placed by you which require audits to validate the premium, or under
reporting form policies, the following provisions apply:
1. You will designate whether the policies will be reflected on your agency bill
or direct bill account upon submission of the applications. If any additional
premiums are developed by audit or under reporting form policies, you will be
responsible to engage in reasonable collection efforts. In the event you are
unable to collect said premiums, we will undertake the direct collection of the
amount due and you will not be held responsible for the collection of such
premiums provided:
(a). For Agency Billed Policies-
You must notify the Company in writing that you are unable to collect all
or any portion of the additional premiums within thirty (30) days after the
end of the month shown on the statement which reflects the additional
premium. If you fail to so notify the Company, you will remain responsible
for the additional premiums.
(b). For Direct Billed Policies-
You must notify the Company in writing that you are unable to collect all
or any portion of the additional premiums within thirty (30) days after the
date of our letter notifying you that all or any portion of the additional
premiums has not been received by us. If you fail to so notify the Company,
you will become responsible for the additional premiums and they will be
charged to your account.
2. You will not be entitled to commissions with respect to premiums collected by
us and with respect to which you have been relieved of your obligation to
collect.
III. HOLD HARMLESS
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A. We will indemnify and hold you harmless against all third party claims,
liabilities, judgments or settlements, including reasonable attorney's fees
arising out of the relationship of the parties under the terms of this
Agreement, which are caused solely by our negligence, gross negligence or
willful misconduct arising as a result of the following:
(1). An act or omission by us in the preparation or handling of any
contract of insurance or billing procedure, except to the extent that you
have caused or contributed to such error; or
(2). The failure of the insured to receive notice of cancellation,
non-renewal or any other notice effecting coverage on "direct billed"
business, where such notices are sent directly to the insured by us.
B. You must immediately notify us in writing when you receive any claim or legal
action to which Section III, Paragraph A., applies and we shall have the right
to investigate any such claim and to participate in or assume the defense of
such legal action.
C. You shall not, except at your own cost, voluntarily make any payment, assume
any liability or incur any expense without our prior written consent.
D. You will indemnify us for liabilities, fines or penalties imposed against us
as a result of violation of statues or regulations by you, your employees, or
authorized sub-agents.
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IV. TERMINATION AND SUSPENSION
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A. This Agreement shall automatically terminate without notice to you, upon:
1. The effective date of the termination, cancellation, revocation, or
non-renewal of your license or certificate of authority.
2. The effective date of the sale, change in majority ownership,
assignment, transfer or merger of your agency, including the sale,
assignment or transfer of a substantial portion of your agency expirations
or book of business placed with us, unless we appoint your successor as an
independent agent authorized to do business with us.
B. This Agreement may be terminated immediately by us upon notice to you in the
event of the following actions or inaction by you, your employees, or authorized
sub-agents:
1. Fraud, willful misconduct, abandonment, or gross negligence; or
2. Violation of any insurance law or regulation; or
3. Misappropriation of any funds or property; or
4. Failure to remit any monies on a timely basis as required by this
Agreement; or
5. The insolvency, bankruptcy or reorganization of the institution of such
or similar proceedings against you; or
6. Violation or breach of any provision of this Agreement or obligation
arising out of this Agreement or any other agreement between the parties or
with an affiliate; or
7. The termination, cancellation, revocation, or non-renewal of the license
or certificate of authority of a principal in the agency.
C. This Agreement may also be terminated at any time with or without cause:
1. By either party giving at least sixty (60) days written notice to
the other, subject to applicable regulatory and statutory
requirements.
2. By mutual written agreement.
D. In the event this Agreement is terminated under Section IV, Paragraph C., and
provided that you have properly accounted for and paid to us all premiums due:
1. You shall not solicit or bind any new risk on our behalf. You shall
not increase any existing risk, except with our prior written consent,
which may be granted or withheld at our sole discretion.
2. Unless otherwise notified by us in writing:
a). You shall continue to do business with us for the sole
purpose of servicing insurance contracts placed by you with us
which are in force or renewed at our election or as required by
law after the date of termination of this Agreement.
b). You shall only issue and countersign appropriate endorsements
on contracts of insurance in force which do not increase or
extend our liability unless you have received specific written
approval for any such increase or extension.
c). Subject to our underwriting rules in existence at the time of
renewal, we shall permit the renewal of policies, in effect on
the date of termination, for a period not to exceed that required
by state statute.
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d). The rates of commission in effect on the date of termination
will apply to renewals authorized under this paragraph. Under no
circumstances will commissions be paid to you if you are no
longer the agent of record or your license has been suspended,
revoked or terminated on the effective date of the insurance
contract.
3. Subject to the above, your responsibility and authority for
reporting of risks and losses and accounting for and payment of
premiums remain unchanged and are as set forth in this Agreement.
E. In the event of termination of this Agreement under Section IV, Paragraphs A
or B, any premiums held by you or premiums for which you have the responsibility
for collection, shall be remitted to us immediately. In any event, if you have
not properly accounted for and paid to us all premiums for which you are liable
at the date of such termination or thereafter, you agree to be responsible for
any and all reasonable attorney's fees (including in-house counsel) and expenses
incurred by us in the collection of such overdue premiums, as well as interest
from the date such premiums become due until paid at a per annum rate equal to
3% above the "prime rate" of interest published in THE WALL STREET JOURNAL on
the first business day following the effective date of termination of this
Agreement.
F. If this Agreement terminates and you have not properly accounted for or paid
to us all premiums for which you are responsible, or pledged to us collateral
acceptable to us, your rights of ownership, use and control of the expirations
of all business placed with us will automatically pass to us and you hereby
grant to us a security interest in such expirations, enforceable as provided in
this paragraph. We have the right to sell the expirations and records in order
to collect what you owe us. If we sell the items for more than you owe us, we
will pay the difference, less our expenses (including in-house or other legal
fees), to you. If we sell your expirations and records for less than what you
owe us, you must pay the difference, plus our expenses (including in- house or
other legal fees), to us.
G. In lieu of termination and at our sole option and discretion, we may suspend
some or all of your authority under this Agreement. Any decision to suspend some
or all of your authority under this Agreement shall in no way waive our right to
terminate this Agreement in accordance with any of the provisions of this
Section IV.
H. All company policies, forms, applications, and other supplies, equipment or
any material bearing our company name or logo furnished by us to you remain our
property and must be accounted for and returned by you to us immediately upon
demand and/or termination of this Agreement.
I. In the event that:
1. You fail to comply with our underwriting rules, regulations
concerning submission of business, or the terms of this Agreement; or
2. You are delinquent in either accounting or payment of any monies
due us pursuant to this Agreement; or
3. You have failed in any material respect to comply with the terms of
this Agreement.
We may immediately suspend your authority to:
(a). Bind coverage of risks;
(b). Write any new or renewal business;
(c). Change any existing policy and/or;
(d). Withhold monies due us by you.
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V. GENERAL PROVISIONS
A. Accessibility of Records
You shall provide us with copies of your financial statements upon our
request. You shall also make available to us for inspection and audit
such other accounting and other records, as we may reasonably require,
and which relate to business you do with us. Our right to audit your
records shall continue, after the termination or expiration of this
Agreement, as respects to business written by you with us.
B. Addition of an Affiliate Company
We may add, as a party to this Agreement, any other affiliated
insurance company by providing you with written notice. In such event,
references to "we", "us", "our(s)" or "Company" shall also include
such newly added insurer.
C. Advertising
You may not include reference to us or any of our policies or services
in any advertising without our express written consent.
D. Amendment of Agreement
This Agreement may be amended at any time by mutual agreement between
the parties which explicitly references this Agreement. Such
amendments must be evidenced by a written amendment signed by you and
us to be effective. We may also revise this Agreement, including any
commission rates under any Commission Schedule, by giving you at least
sixty (60) days written notice of such revision. During the term of
this Agreement, the commission rates specified in any Commission
Schedule(s) shall remain in effect unless revised as provided above,
except that we will not, without your consent, revise commissions with
respect to any one line of insurance listed on the Commission Schedule
more frequently than once in any twelve (12) month period. No waiver
of any provision of this Agreement shall be effective, unless signed
by the party against whom enforcement of such waiver is sought.
E. Assignment of Rights
You may not assign any rights or obligations under this Agreement
without our express written consent.
F. Authorization for Liability
Unless otherwise authorized by us in writing, you may not commit us to
any liability in connection with any claim or loss.
G. Confidential and Proprietary Information
You understand and acknowledge that, during the term of this
Agreement, you may gain access to certain confidential and proprietary
information relating to the Company and its business and you agree to
keep all such information confidential, including after termination of
this Agreement. In addition, if we allow access to our data processing
files through a computer terminal or other data processing equipment,
then you shall be responsible for maintaining the security, integrity
and confidentiality of such data processing files and agree not to
download such files without our prior written consent.
H. Corporations
In the event that, under this contract, you are a corporation, the
undersigned individuals jointly and severally guarantee for
themselves, heirs, successors and assigns, the faithful performance of
this contract by you. You agree to pay any money, for which you may
become liable to us, pursuant to this Agreement in which you fail or
refuse to promptly pay upon demand.
I. Entire Agreement
This Agreement supersedes and replaces any prior representations,
understandings or agreements, whether written or oral, between the
parties, including any prior agency agreement, except that this
Agreement does not affect amounts owed under any prior agreement. The
parties warrant that this Agreement (including the Commission
Schedules applicable from time to time) is
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the entire agreement between them with respect to the subject areas
addressed and the legal relationship between them, and they have
relied upon no other statements, understandings or representations
whatsoever as a basis for entering into this Agreement.
J. Errors and Omissions
You agree to maintain, at your own expense, a policy of errors and
omissions insurance with solvent insurance carriers, in an amount not
less than $300,000, providing coverage for the payment of sums which
you, your sub-agent, officers or employees may become legally liable.
This policy must be maintained throughout the term of this Agreement
and renewals thereof. We retain the right to demand evidence of such
insurance. Failure to comply with the terms of this paragraph shall,
at our option, be grounds for immediate suspension of this Agreement.
K. Independent Contractor
This Agreement authorizes you to transact business with us as an
independent agent, but only as expressly set forth herein. The parties
expressly agree that the Agency acts as an independent agent and the
relationship between you and us is an independent contractor
relationship. In no case shall you be deemed to be or have any rights
of an employee, joint venturer or partner of ours. This Agreement does
not give you the exclusive right to transact business with us as an
independent agent in any geographic area or for any kind of insurance,
product or program, nor does this Agreement give us the exclusive
right to your services and you are free to represent other companies
of your choosing and to determine what mix of carriers is best for you
and to otherwise conduct your business as you see fit.
L. Interpretation of Agreement
The interpretation of this Agreement shall be governed by the laws of
the State of Missouri (without regard to any choice of law
provisions). If any part of this Agreement is in conflict with
applicable law, regulation, directive or order, or is found to be
unenforceable, that part of this Agreement will be deemed modified to
conform with such law, regulation, directive, order or finding of
unenforceability. No other provisions of this Agreement will be
affected.
M. Notice Effective Date
Unless otherwise specified in this Agreement, any notices provided
under this Agreement shall be deemed effective upon the earlier of
Five (5) business days after mailing or upon receipt.
N. Offset of Amount Due or Owed
In the event you fail to pay any amount due us under this Agreement or
otherwise, we are entitled to offset said amount by crediting your
account or by deducting said amount from any balance we may owe you.
No notice shall be required prior to exercising our right to offset.
0. Ownership of Expirations
While this Agreement is in effect and subject to Section IV, Paragraph
F., you own all your expirations whether agency billed or "direct
billed", and all your records of business produced by you. Unless
authorized by you, we may not use or authorize anyone else to use our
records of your business or expirations in order to sell, service, or
renew any policy or other product unless otherwise permitted by this
Agreement; however, we may provide insureds with general information
about Columbia Insurance Group, insurance coverage, proposed laws or
regulations and coverages or services available through Columbia
Insurance Group.
P. Performance of Others
You assume full responsibility and liability for the performance of
all duties and obligations, as set forth herein, by all of your
partners, associates, officers, employees, agents, sub-agents or
producers. Any act or omission, or breach of the Agreement, by any of
your partners, associates, officers, employees, agents, sub-agents or
producers shall be deemed an act, omission or breach by you and we may
exercise our rights under
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this Agreement as if such act, omission or breach had been committed
by you.
Q. Right to Accept and Reject Business
Subject to applicable laws and regulations, we reserve the right to
reject, for any reason, any business submitted by you and we are not
obligated to accept submissions for or to write or to continue to
write any business that no longer meets our underwriting guidelines or
business objectives. No provision of the Agreement shall limit our
right to restrict or withdraw from our writing of any kind of business
in any jurisdiction.
R. Underwriting Associations, Syndicates, etc.
The provisions of this Agreement shall not apply to business
administered by underwriting associations, syndicates, pools or like
organizations.
S. Your Responsibility for Expenses
We will not be responsible for expenses, fees, taxes or any other
charges whatsoever incurred by you or on your behalf, except as
authorized by us in writing.
WITNESS, THE PARTIES HAVE EXECUTED AND YOU ACKNOWLEDGE THAT YOU HAVE READ AND
UNDERSTOOD THIS AGREEMENT:
INDEPENDENT AGENT OR AGENCY:
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By: /s/ Michael Hess
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Name: Michael Hess
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Title: President
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Date: April 6, 2000
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By:
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Name:
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Title:
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Date:
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COMPANY:
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By: /s/ Dwight Tully
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Name: Dwight Tully
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Title: V.P. - Branch Manager
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Date: April 6, 2000
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SCHEDULE FOR
COLUMBIA MUTUAL INSURANCE COMPANY
FEBRUARY 1, 1995
Commission Schedule Columbia Mutual Insurance Company
<TABLE>
<CAPTION>
LINES OF BUSINESS NEW RENEWAL
----------------- --- -------
<S> <C> <C>
Homeowners 12.5% 12.5%
Personal Auto 10% 10%
Personal Umbrella 12.5% 12.5%
</TABLE>
The Commission Rates contained herein are subject to modification by the Company
upon 180 days notice or applicable statutory notice, whichever is less.
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Date
10-25-96
/s/ Michael Hess
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Agency Representative
/s/ Dennis D. Roth
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Company Representative
<PAGE>
SCHEDULE FOR
PATRONS INSURANCE COMPANY
FEBRUARY 1, 1995
Commission Schedule Patrons Insurance Company
<TABLE>
<CAPTION>
LINES OF BUSINESS NEW RENEWAL
----------------- --- -------
<S> <C> <C>
Standard Fire 15% 12.5%
F.C.P.L. 20% 15%
C.P.L. 15% 12.5%
Homeowners 15% 12.5%
Farmowners/Ranchowners 20% 15%
Mobile Homeowners 15% 12.5%
Accommodation Fire Lines 15% 12.5%
Auto 10% 10%
Personal Umbrella 15% 12.5%
Commercial Package Policy 20% 20%
General Liability 20% 20%
Commercial Fire 20% 20%
Commercial Auto 15% 15%
Inland Marine 20% 20%
Crime 20% 20%
Fire and Allied Lines 20% 20%
Business Owners 20% 20%
Commercial Umbrella 10% 10%
Workers Compensation 5% 5%
</TABLE>
The Commission Rates contained herein are subject to modification by the Company
upon 180 days notice or applicable statutory notice, whichever is less.
Date
10-25-96
/s/ Michael Hess
Agency Representative
/s/ Dennis D. Roth
Company Representative
<PAGE>
SCHEDULE FOR
COLUMBIA NATIONAL INSURANCE COMPANY
FEBRUARY 1, 2000
KANSAS
Commission Schedule Columbia National Insurance Company
<TABLE>
<CAPTION>
LINES OF BUSINESS NEW RENEWAL
----------------- --- -------
<S> <C> <C>
Standard Fire 15% 12.5%
F.C.P.L. 20% 15%
C.P.L. 15% 12.5%
Homeowners 15% 12.5%
Farmowners/Ranchowners 20% 15%
Accomodation Fire Lines 15% 12.5%
Auto 10% 10%
Personal Umbrella 15% 12.5%
Commercial PackagePolicy 20% 20%
General Liability 20% 20%
Commercial Fire 20% 20%
Commercial Auto 15% 15%
Inland Marine 20% 20%
Crime 20% 20%
Fire and Allied Lines 20% 20%
Business Owners 20% 20%
Commercial Umbrella 10% 10%
Workers Compensation 5% 5%
</TABLE>
The Commission Rates contained herein are subject to modification by the
Company upon 180 days notice or applicable statutory notice, whichever is less.
April 6, 2000
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Date
/s/ Michael Hess
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Agency Representative
/s/ Dwight Tully
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Company Representative
<PAGE>
AGENCY PROFIT SHARING BONUS
This Agreement is a part of the Agency Contract between Columbia
Insurance Group and Brooke Corporation Effective Date: April 1, 2000
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W I T N E S S E T H:
In consideration of the mutual covenants and agreements contained
herein and in the Agency Agreement between the parties hereto, the Company
agrees to pay the Agent additional compensation in the form of a share in the
underwriting profits on business produced by Agent subject to the following
provisions:
1. This Profit Sharing Bonus Agreement shall apply to all property
and casualty business written by Columbia Insurance Group for the
account of the Agent for which commission is specified in the
attached Agency Agreement.
2. At the end of each calendar year the underwriting profit or loss
shall be calculated by the Company from their records as follows:
a. Income: Premiums earned on policies written as computed
by the Company.
b. Losses: Losses incurred represent the total of the loss
payments made during the calendar year, plus the actual case
estimates on losses outstanding at the end of the calendar
year, less the actual case estimate on losses outstanding at
the beginning of the calendar year. Losses shall be charged
in the period during which they are incurred or increased,
regardless of the policy date. Decreases in reserves shall be
credited in the period during which they are decreased.
c. Adjusting Expense: Adjusting expense shall be calculated at a
rate of 10% of the current year incurred losses.
d. Commission Expense: Commission expense shall be computed by
dividing commissions paid to Agent by premiums written to
obtain the percentage of commissions paid. The percentage is
then applied to the earned premium to determine commission
expense for the current year.
e. Taxes and Underwriting Expenses: Shall be computed at a
rate of 20% of current year earned premium.
f. Deficit Carryforward: Shall include any deficit incurred
during the two preceding calendar years.
g. Underwriting Profit or Deficit: Underwriting profit or
deficit shall be determined as the difference between
Item a and the sum of Items b, c, d, e and f.
<PAGE>
3. PROFIT SHARING BONUS COMPUTATIONS:
The amount of Profit Sharing Bonus earned by Agent shall be the result
of multiplying the underwriting profit as determined above by the applicable
percent from the table below:
<TABLE>
<CAPTION>
Net Written Premium Profit Sharing Percentage
------------------- -------------------------
<S> <C>
$ 35,000 - 99,999 10.0%
$100,000 - 199,999 12.5%
$200,000 - 349,999 15.0%
$350,000 - 499,999 20.0%
$500,000 - or more 25.0%
</TABLE>
4. ADDITIONAL STIPULATIONS:
a. No Profit Sharing Bonus will be payable for any calendar year
in which the net premiums written by the Agent are less than
_______ except for the partial year ending December 31st
following the effective date of this agreement, in which case
the minimum net premium shall be $35,000. The partial year
threshold provided in this paragraph shall only be applicable
to newly appointed agents, and shall not be applicable in
cases where Agent has acquired a book of business, producer
or an agency which is subject to an Agency Agreement with
Company at the time of said acquisition.
b. No Profit Sharing Bonus will be payable for any year, if at
any time during the year, the agent is past due in the
payment of his account with Company, according to the records
of the Company. Minor differences between agent's and
company's records or failure to pay until a disputed item is
adjusted shall not constitute delinquency.
c. Beginning with the second full calendar year in which Agent
represents the Company, an additional 25% will be added to
the Profit Sharing Bonuses if current written premiums
increase by 15% or more over the previous year; 25% will be
deducted from the Profit Sharing Bonuses if current written
premiums decrease by 15% or more over the previous year.
d. No Profit Sharing Bonus will be payable if the Agency
Agreement is terminated by either party for any reason. In
the case of termination initiated by the Company, an Agency
Agreement shall be considered to be cancelled at such time as
the Agent is no longer authorized to submit new risks to the
Company for consideration.
e. In the event that an agency is sold, the purchaser shall
assume the incurred losses and earned premiums and deficit
carryforward, if any, of the purchased agency. Any earned
Profit Sharing Bonus shall be paid to the party owning the
Agency at the end of the calendar year. A division of the
Profit Sharing Bonus agreed upon between purchaser and seller
shall be their responsibility and shall not be binding upon
the Company. All agencies qualifying for profit sharing will
be determined by the Company, whose decisions shall be final,
and no representative or agent has authority to change any
provision of this plan.
f. This Profit Sharing Bonus plan shall be effective on the date
shown above and will supersede all previous commission
agreements and shall run concurrently with each calendar year
and may be terminated by the Company at any time upon written
notice to
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the agency. Payment of Profit Sharing Bonuses will be made as
soon as possible following the close of the calendar year.
g. When a principal is a principal of multiple agencies, Profit
Sharing Bonus calculations shall be based on the combined
earned premiums, incurred losses, written premiums, expenses
and deficits of the multiple agencies.
h. This agreement may be amended in writing when signed by both
the Company and the Agent. The amended Agreement will be
effective in the following calendar year.
IN WITNESS WHEREOF, the Agreement has been executed in duplicate this
6th day of April, 2000.
--- ------------
Brooke Corporation COLUMBIA INSURANCE GROUP
------------------------------
Agency Name
/s/ Michael Hess /s/ Dwight Tully
------------------------------ ---------------------------------
Branch Manager
President /s/ Connie Burkes
------------------------------ ---------------------------------
Title Marketing Representative
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