ROYALTY & LICENSE AGREEMENT
 
THIS AGREEMENT (the "Agreement"), effective on the date hereinafter set forth,
by and between Farm Bureau Mutual Holding Company, its affiliated property
casualty insurance companies of which it has voting control, directly or
indirectly, including Farm Bureau Property & Casualty Insurance Company and
Western Agricultural Insurance Company, and Farm Bureau Life Insurance Company
(hereinafter collectively "Insurance Companies") on the one part, and the
__________ Farm Bureau Federation (hereinafter "Farm Bureau") on the other part.
 
WITNESSETH:
 
WHEREAS, Farm Bureau has the exclusive right to the use and benefit of the
designations "Farm Bureau," "FB," and the National "FB" Logo (hereinafter
referred to as the "Marks") within the State of __________ (the "Territory")
pursuant to Section 3 of the Membership Agreement (the Membership Agreement)
between the Farm Bureau and the American Farm Bureau Federation ("AFBF"); and
 
WHEREAS, an essential purpose of the Farm Bureau is to raise the quality of life
of the people of rural_______________; and
 
WHEREAS, the Insurance Companies wish to obtain a license from Farm Bureau to
use the Marks in the Territory in connection with the sale of the Insurance
Companies' products (the "Products") to Farm Bureau's members; and
 
WHEREAS, the Insurance Companies elevate the quality of life of rural residents
who are Farm Bureau members within the state of Iowa by making the Products
available to them.
 
NOW, THEREFORE, the parties hereto, in consideration of their mutual
obligations, agree as follows:
 
1. Farm Bureau hereby grants to Insurance Companies an exclusive license to use
the Marks only in the Territory and only in connection with the Products,
subject to revocation by the AFBF Board of Directors, in consideration of the
royalty payable to the Farm Bureau according to the formula in Paragraph 9
herein. 
 
2. (a) In order to protect the Marks, with respect to monitoring and control by
the Farm Bureau of the nature and quality of the Products provided by Insurance
Companies under the Marks and the mode and manner of the usage of the Marks by
Insurance Companies, said Products and usage shall meet the standards
hereinafter set forth:
 
(1) The Products to be provided by Insurance Companies under or in connection
with the Marks shall strictly comply with all applicable federal and state laws
and regulations and the rules or regulations of any self-regulatory bodies
governing such products. If Farm Bureau believes that the Products provided by
Insurance Companies under or in connection with the Marks do not comply with
such laws, rules and regulations, Farm Bureau shall furnish Insurance Companies
with written notice specifying in what respects such Products fail to comply and
allow Insurance Companies ninety (90) days in which to cure any such problem.
 

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(2) Farm Bureau, at its sole discretion may exercise a right of prior written
approval as to whether the manner in which Insurance Companies use or display
the Marks is consistent with the quality standards set forth in this paragraph
2. Farm Bureau acknowledges that it has approved the manner in which Insurance
Companies use or display the Marks as of the date of this Agreement, and that it
hereby approves future uses or displays that are consistent with and maintain
the quality of such current usage. Insurance Companies acknowledge that Farm
Bureau may implement further reasonable quality control standards from time to
time during the term of this Agreement.
 
(3) Insurance Companies shall adhere to the following:
(a) The notice "®" shall always appear in conjunction with the Marks.
(b) The designation FARM BUREAU shall always be either capitalized or set forth
in initial capitals, and the letters "FB" shall always be capitalized.
(c) Upon request during the term of this Agreement, Insurance Companies shall
provide to Farm Bureau a reasonable number of representative samples of
materials, documents, forms and the like which are publicly disseminated and on
which the Marks are used or displayed.
 
(4) Insurance Companies agree to abide by the policies and resolutions of the
AFBF Board of Directors relating to the use of the Marks, including adherence to
the provisions of the Farm Bureau Marks Use Manual, as amended from time to
time.
 
(b) Farm Bureau represents and warrants to Insurance Companies, and Insurance
Companies acknowledge, that AFBF is the owner of all right, title and interest
in and to the Marks, and the United States Collective Membership Marks and
Service Mark Registrations therefore, including Reg. Nos. 1,612,451; 1,469,990;
1,604,920; and 1,874,169; and AFBF has granted Farm Bureau the license to use
the Marks in the state of ___________ pursuant to the AFBF Membership Agreement
between AFBF and Farm Bureau.
 
(c) Insurance Companies shall not challenge, or assist any other party in
challenging the validity of, or Farm Bureau's and/or AFBF's rights in, to or
under, the Marks or AFBF's ownership of the Marks within the state of __________
or elsewhere.
 
(d) Insurance Companies shall not seek to register at either the federal or
state level the Marks or any mark that Farm Bureau reasonably believes to be
confusingly similar to the Marks.
 
(e) AFBF shall have the sole right, but no obligation, to bring and/or defend
against infringement, unfair competition, or other claims or proceedings
involving the Marks. When requested by AFBF and/or Farm Bureau, Insurance
Companies shall cooperate with AFBF and Farm Bureau in efforts to stop an
infringement of or otherwise protect the Marks or in efforts to defend against
claims of infringement.
 
(f) Without Farm Bureau's and AFBF's prior written consent, Insurance Companies
may not assign or otherwise transfer in any manner whatsoever this Agreement or
the license granted hereunder and may not grant any sublicenses or otherwise
encumber the title of AFBF in the Marks, or Farm Bureau's exclusive right to use
the Marks in the Territory.
 
(g) Insurance Companies shall only use such insurance agents or agencies for the
distribution of the Products in connection with the Marks as approved by the
Farm Bureau.
 

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3. The parties agree to indemnify each other as follows:
    
(a) Insurance Companies shall defend, indemnify and hold Farm Bureau harmless
from any loss, liability, damage or expense, including reasonable attorney fees,
arising in connection with or resulting from any breach of warranty,
misrepresentation or nonfulfilment of any requirement of Insurance Companies
under this Agreement, unless waived in writing by Farm Bureau.
 
(b) Farm Bureau shall defend, indemnify and hold Insurance Companies harmless
from any loss, liability, damage or expense, including reasonable attorney fees,
arising in connection with or resulting from any breach of warranty,
misrepresentation or nonfulfilment of any requirement of Farm Bureau under this
Agreement, unless waived in writing by Insurance Companies.
 
4. The royalty payments to be received by Farm Bureau are not compensation to
Farm Bureau for services performed for Insurance Companies.
 
5. Farm Bureau will not provide any products or services to Insurance Companies
as a condition to its receipt of, nor in exchange for, the royalty payments
received pursuant to this Agreement, other than those duties necessary to allow
Insurance Companies to use its name, logo and related intangible benefits.
 
6. Insurance Companies pledge to make the Products (including subsequent
revisions thereof) available to Farm Bureau members and rural residents of
___________________.
 
7. This Agreement shall supersede all other Royalty agreements now in effect, if
any, between the parties hereto as of the effective hereinafter provided. This
Agreement shall be binding upon the parties hereto and their successors and
assigns.
 
8. This Agreement shall take effect on the 1st day of January, 2010, and
continue in full force and effect until December 31, 2033, and shall continue in
full force from calendar year to calendar year thereafter, except that, after
December 31, 2033, any party hereto may cancel this Agreement by providing all
parties hereto notice no less than one hundred eighty (180) days prior to the
end of the calendar year the party wishes to terminate this Agreement, after
which notice this Agreement shall thereafter terminate effective December 31st
of the year such notice was properly provided. This Agreement may also be
terminated by either party at any time if the other party is in material breach
of its obligations hereunder.
 
9. ROYALTY CALCULATION. In exchange for the granting of the foregoing by Farm
Bureau, Insurance Companies shall provide a royalty to Farm Bureau calculated as
follows:
 
(a) Life Royalties. Royalties on products sold by Farm Bureau Life ("FBL") shall
be the greater of either subparagraph (i) or (ii) as follows:
 
(i) Three percent (3.0%) of all first-year life, long term care and disability
insurance premiums, and three-tenths of one percent (0.3%) of all first-year
annuity premiums and Universal Life and Variable Universal Life premiums in
excess of the minimum initial premium, received and retained by FBL, or by
unaffiliated companies with which FBL has a marketing agreement for products of
theirs sold by FBL's agency force, within the calendar year on issued and paid
for business sold within the State of ___________________; or
 
(ii) Six-tenths of one percent (0.6%) of all life, long term care and disability
insurance premiums, and six one-hundredths of one percent (0.06%) of all annuity
premiums and Universal Life and Variable Universal Life premiums in excess of
the minimum initial premium, received and retained by FBL or by unaffiliated
companies with which FBL has a 

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marketing agreement for products of theirs sold by FBL's agency force, within
the calendar year on issued and paid for business sold within the State of
__________________ .
 
(b) P/C Royalties. Royalties on insurance products sold and underwritten by any
property casualty insurance company which the majority of voting stock is owned,
directly or indirectly, by Farm Bureau Mutual Holding Company ("FBMHC"), shall
be calculated as follows:
 
(i) One percent (1.0%) of the annual direct written premium of all property,
automobile, personal lines, farm and ranch, commercial, crop-hail, farmer paid
portion of multi-peril crop insurance (MPCI), and related products sold through
Farm Bureau captive and/or affiliated agents in the State of ______________;
plus
 
(ii) An amount equal to One percent (1.0%) of the annual direct written premium
from products listed in subparagraph 9(b)(i) above, sold:
 
(a) in a state where FBMHC is not authorized to use the Marks in connection with
the sale of insurance products; and/or
 
(b) through agents other than Farm Bureau captive or affiliated agents;
multiplied by
 
(c) Farm Bureau's percentage of direct written premium of the total direct
written premium in all states where FBMHC is authorized to use the Marks in the
sale of insurance products, excluding direct written premium in those states on
policies sold through agents other than Farm Bureau captive or affiliated
agents. By way of illustration, the calculation of the royalty to be paid
pursuant to this subparagraph (ii) would be as follows:
 
1% of premium on policies sold through non-Farm Bureau agents or in states where
FBHMC is not authorized to use the Marks
X
Percentage that State Farm Bureau's premium represents compared to total premium
sold through Farm Bureau agents in all states where FBMHC is authorized to use
the Marks

 
The Farm Bureau percentage applied pursuant to this subparagraph shall be as
calculated for the calendar year preceding the year in which it is to be
applied.
 
(c) The Insurance Companies shall pay one-twelfth (1/12) of the estimated annual
royalty required pursuant to this paragraph each month, and shall pay (or
withhold) any additional amounts as soon after the end of the calendar year as
the actual royalty for the year can be calculated.
 
10. Membership. In addition to the royalty payment required herein, and in
exchange for the right to use the Marks as heretofore provided, Farm Bureau
Mutual Holding Company shall require that all insurance policies sold in the
state of _____________ and underwritten by companies in which it owns, directly
or indirectly, the majority of voting stock, shall require, as a condition of
becoming an insured, that each such policyholder be a member of a County and/or
State Farm Bureau organization in the state of ____________________, unless such
a requirement is prohibited by state or federal statute or regulation, or this
requirement is waived by Farm Bureau.
 
IN WITNESS WHEREOF, the parties hereto have set their hands to duplicates
thereof on the designated places.
 
[Signatures on following page]
 

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FARM BUREAU MUTUAL HOLDING COMPANY,
 
 
FARM BUREAU PROPERTY & CASUALTY
 
 
INSURANCE COMPANY and WESTERN
 
 
AGRICULTURAL INSURANCE COMPANY
 
 
 
 
By:
 
 
 
 
 
Title:
 
 
 
 
 
 
 
FARM BUREAU LIFE INSURANCE COMPANY
 
 
 
By:
 
 
 
 
 
Title:
 
 
 
 
 
 
 
______________ FARM BUREAU FEDERATION
 
 
 
 
 
 
By:
 
 
 
 
Authorized Representative of ____________ Farm Bureau Federation
 
 
 
Title:
 
 
 
 
 

 

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