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                                                                   EXHIBIT 10.36

                                   WRAP-AROUND

            MULTILINE QUOTA SHARE REINSURANCE AGREEMENT - VSC2004/73

         THIS AGREEMENT is made and entered into by and between VIRGINIA SURETY
COMPANY, INC., an Illinois corporation, (hereinafter called the "Company") of
the one part, and TOWER INSURANCE COMPANY OF NEW YORK (hereinafter called the
"Reinsurer") of the other part.

         The parties hereto agree as hereinbelow, in consideration of the mutual
covenants contained in the following Articles and upon the terms and conditions
set forth herein:
                                    ARTICLE I
COVERAGE

         The Company is obligated to cede to the Reinsurer, and the Reinsurer is
obligated to accept, a 100% quota share participation of the Company's net line
on each risk, in respect to any loss or losses occurring on all policies written
and all policies renewed in connection with the authority granted to the
Company's Agent under the Managing General Agency Agreement, reference number
VSC2004/72 with effective dates during the term of this Agreement and classified
by the Company as Multiple Line Program.

                                   ARTICLE II
LIABILITY

           The Reinsurer's liability will begin obligatorily and simultaneously
with that of the Company and all reinsurance ceded hereunder will be subject to
the same terms, rates, conditions, interpretations, waivers, modifications, and
alterations as the respective policies of the Company insofar as they relate to
the business covered hereunder. The Reinsurer will be liable for all business
risks and security risks arising under this Agreement. Further, the obligations
of the Reinsurer will extend to any policy coverage required of the Company by
any legislative, regulatory, or judicial body. The intent of this Agreement
being that the Reinsurer will follow the fortunes of the Company on the policies
to which this Agreement applies.



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                                   ARTICLE III
TERM AND CANCELLATION

         This Agreement will apply to all liability of the Company associated
with all policies written and all policies renewed with effective dates during
the term of this Agreement. This Agreement will take effect on December 1, 2004,
12:01 a.m. standard time (as set forth in the Company's policies) and will
remain in force and effect for one (1) year expiring on December 31, 2005,12:00
p.m. standard time.

         At the expiration of this Agreement, the Reinsurer will remain liable
for all policies in force until their natural expiration or renewal dates,
whichever come first.

         Either party may cancel this Agreement at any time by giving at least
thirty (30) days notice in writing via electronic, certified, or registered
mail, stating therein the date on which termination will become effective. If
the Reinsurer's participation is so canceled, it will remain liable for all
policies in force until their expiration, termination, or first anniversary
date, whichever comes first.

         Additionally, the Company may cancel the Reinsurer's participation
hereon immediately by giving notice in writing by electronic, certified, or
registered mail to the Reinsurer in the event of one of the following
circumstances:

         A.       The Reinsurer ceases underwriting operations;

         B.       The State Insurance Department, or other legal authority,
                  orders the Reinsurer to cease writing business;



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         C.       The Reinsurer has become insolvent or has been placed into
                  liquidation or receivership (whether voluntary or
                  involuntary), or there has been instituted against it
                  proceedings for the appointment of a receiver, liquidator,
                  rehabilitator, conservator, or trustee in bankruptcy, or other
                  agents known by whatever name, to take possession of its
                  assets or control of its operations;

         D.       The Reinsurer's surplus has been reduced by twenty percent
                  (20%) or the Reinsurer has lost any part of, or has reduced
                  its paid-up capital after the inception of this Agreement. As
                  of June 30, 2004, the Reinsurer's surplus was $34,675,000and
                  its paid-up capital is $23,230,000

         E.       The Reinsurer has merged with or has become acquired or
                  controlled by any company, corporation, or individual(s) not
                  controlling the Reinsurer's operations previously;

         F.       The Reinsurer has reinsured its entire liability under this
                  Agreement without the Company's prior written consent;

         G.       The Reinsurer is deemed by the Company as potentially unable
                  to meet its financial obligations under this Agreement due to
                  three or more of its NAIC IRIS ratio tests falling outside the
                  normal range as determined by the NAIC;

         H.       The Reinsurer's A.M. Best rating is downgraded after the
                  inception of this Agreement. As of June 30, 2004, the
                  Reinsurer's A.M. Best Rating was B++;

         I.       The Reinsurer's ratio of net premiums written to
                  policyholders' surplus exceeds three (3) to one (1).

                  If the Reinsurer's participation is so canceled, it will
                  remain liable for all policies in force until their
                  expiration, termination, or first anniversary date, whichever
                  comes first.

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         Alternatively, the Company may elect to cancel the Reinsurer's
liability on a cut-off basis as of the date of cancellation, and the Reinsurer
will not be liable for any losses occurring on or after the cancellation date
and will return immediately to the Company any unearned reinsurance premium as
of that date, computed on a monthly pro rata basis.

         During any such aforementioned period of notice, the Reinsurer will
remain bound by the terms of this Agreement.

         Notwithstanding the other provisions in this Article, in the event the
Company's policies are written in a jurisdiction where cancellation, renewal, or
nonrenewal is regulated by the insurance authorities, and the Company is bound
for a period longer than the original policy period by such regulations and
statutes of said jurisdiction or by a judicial decision, the Reinsurer will
remain liable for any such policies in force at the expiration or cancellation
date of this Agreement until the date each expires or until the first renewal
date when the Company can lawfully nonrenew said policies, whichever occurs
first.

         Should this Agreement expire or be canceled while a loss is in
progress, the Reinsurer will be responsible for its proportion of the entire
loss or damage caused by such loss, subject to the other conditions of this
Agreement.

         Notwithstanding the expiration or cancellation of this Agreement as
hereinabove provided, the provisions of this Agreement will continue to apply to
all obligations and liabilities of the parties incurred hereunder to the end
that all such obligations and liabilities will be fully performed and
discharged.


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                                   ARTICLE IV
TERRITORY

         The territorial scope of this Agreement will follow that of the
Company's policies.

                                    ARTICLE V
DEFINITIONS

         The following terms, wherever used in this Agreement, will have the
meanings set forth in this Article, and will be deemed to refer to the singular
or plural as the context requires:

         "Business risk" means any liability of the Company in connection with
the policies reinsured hereunder which is not included in loss, loss expense and
security risk as defined in this Article.

         "Coverage dispute expense" means all expenses (including, but not
limited to, attorneys' fees, arbitration costs, and court costs) the Company has
paid, or has become liable to pay, in connection with any coverage disputes
regarding the policies, including, but not limited to, declaratory judgment
actions and arbitration proceedings brought to determine the Company's
obligations attributable to the policies. Coverage dispute expense will be
deemed to have been incurred by the Company on the date the loss was suffered,
or allegedly suffered, under the policy.

         "Gross written premium" means all the written premium of the Company
for the classes of business reinsured hereunder, less returned premium and
cancellations.

         "Loss" means the amount paid by the Company, or for which the Company
has become liable to pay, under the policies reinsured hereunder (including, but
not limited to, amounts in settlement of claims and suits and in satisfaction of
judgments, and interest accrued prior to final judgment if such interest is
included as part of loss under the policies reinsured hereunder) after the
deduction of all recoveries, salvages, subrogation and recovered inuring
reinsurance. Loss will include 100% of any Extra Contractual Obligations and/or
100% of any Excess Limits Liability. Loss will not include loss expense unless
loss expense is included within the limit of liability of policies reinsured
hereunder.



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         "Loss expense" means all expenses paid by the Company, or for which the
Company has become liable to pay, in the investigation, appraisal, adjustment,
settlement, litigation, appeal, and/or defense of claims under the policies
reinsured hereunder (including, but not limited to: Steven G. Fauth fees in
accordance with the fee structure set forth in Exhibit D of the Managing General
Agency Agreement, reference number VSC2004/72, in-house adjusters, defense
attorneys and other claims personnel of Tower Claims Services (TCS, court costs;
interest accrued prior to and after final judgment; and salaries and expenses of
employees of the Company who have been diverted from their normal and customary
duties and assigned to the handling of claims on policies reinsured hereunder if
Agent is unable to perform its duties in accordance with the Managing General
Agency Agreement, reference number VSC2004/72). Loss expense will also include
coverage dispute expense and monitoring expense. The Reinsurer will bear all
loss expense in addition to its liability hereunder unless such loss expense is
included as part of loss under the policies and will benefit accordingly in all
salvages, subrogation, discounts, and other recoveries. Loss expense excludes
internal office expenses, salaries, per diem, and other remuneration of Company
employees who have not been diverted from their normal and customary duties and
assigned to the handling of claims on policies reinsured hereunder this
Agreement.

         "Monitoring expense" means all expenses the Company has paid, or has
become liable to pay, in connection with claims under this Agreement, including,
but not limited to, attorneys' fees and all other legal expenses, when such
expenses were incurred by directly assisting in the handling of claims or by
acting in a supervisory, reviewing, or advisory capacity. Monitoring expense
will be deemed to have been incurred by the Company on the date the loss was
suffered, or allegedly suffered, under the policy.

         "Net line" will mean the gross loss and loss adjustment expense
applicable to each policy reinsured hereunder as specified in the Coverage
Article, less all collected reinsurance recoverable under treaty and facultative
reinsurance agreements applicable to such policies plus any business risk and
security risk.



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         "Net written premium" means the gross written premium of the Company
for the policies reinsured hereunder as specified in the Coverage Article, less
premium for other treaty and facultative reinsurance agreements.

         "Policy" means each policy, contract, binder, endorsement, certificate,
agreement or evidence of insurance, whether written or oral.

         "Security risk" means amounts not recovered by the Company under other
treaty or facultative reinsurance agreements applicable to policies reinsured
hereunder. Treaty and facultative reinsurance agreements applicable to policies
reinsured hereunder are set forth in Exhibit A attached hereto.

                                   ARTICLE VI
REINSURANCE PREMIUM

         The Agent on behalf of the Company will pay the Reinsurer 2% of the
collected gross written premium within 30 days after the close of each month.

         The Agent on behalf of the Company will collect and remit to the
Company taxes, fees and assessments imposed by law or regulation which are
billed directly to insureds (hereinafter "insured paid assessments"). Such
insured paid assessments shall be paid 100% to the Company on a monthly basis,
30 days after the close of each month.

          In addition, the Company shall pay the Reinsurer any interest income
earned under the terms of the Multiple Line Quota Share Reinsurance Agreement,
AR15935 (attached as Exhibit A).



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                                   ARTICLE VII
REPORTS
         Within thirty (30) days after the close of each month, the Agent on
behalf of the Company will furnish the Reinsurer with a report detailing the
gross written premium, net written premium, losses and loss expense paid, losses
and loss expense outstanding, monies recovered and reserves for incurred but not
reported losses (IBNR). The Company and the Reinsurer will use these reports to
determine the funding required in Article IX - Trust Account.

                                  ARTICLE VIII
TRUST ACCOUNT

         If one of the events as defined in this Article occurs, the Reinsurer,
the Company, and a qualified financial institution acting as trustee thereunder
will immediately enter into a Trust Agreement under which the Reinsurer will
create a Trust Account for the benefit of the Company and will deposit the funds
equal to its obligations as defined in this Article into the Trust Account
WITHIN FIVE WORKING DAYS AFTER THE REINSURER IS REQUESTED TO DO SO BY THE
COMPANY. Trust Account means the funds and other assets held by the trustee from
time to time under the Trust Agreement. The Trust Agreement will comply with,
and the financial institution acting as trustee thereunder will be qualified to
act as trustee pursuant to, the applicable laws and regulations of Illinois and
New York, and those of each other applicable jurisdiction.

         Assets deposited in the Trust Account shall consist only of (i) cash
(United States legal tender), (ii) direct obligations of the United States or of
any agency or instrumentality of the United States, or in certificates of
deposit issued by a financial institution organized under the laws of the United
States or any state to the extent guaranteed or insured as to the payment of
principal and interest, or to the payment of principal only, by the United
States or an agency or instrumentality of the United States, provided such
obligation or certificate of deposit shall have a maturity date of ten years or
less from the date of purchase; and (iii) other investments for which the
Company shall first have given its written consent (which may be given subject
to conditions) from among those which are eligible investments for the Company
pursuant to both Article VIII of the Illinois Insurance Code and Paragraphs (1),
(2), (3), (8) and (10) of subsection (a) of Section 1404 of the New York
Insurance Law; provided that such investments are issued by an institution that
is not the parent, subsidiary, or affiliate of either the Company or the
Reinsurer.



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         Notwithstanding any other provisions of this Agreement, the Company or
its successors in interest may draw upon the Trust Account at any time, without
diminution because of insolvency of the Company or of the Reinsurer, for one or
more of the following purposes only:

         A. To pay or reimburse the Company for the Reinsurer's share under this
         Agreement regarding: (i) any losses and loss expenses paid by the
         Company but not recovered from the Reinsurer; (ii) for unearned
         premiums due to the Company, if not otherwise paid by the Reinsurer in
         accordance with the terms of this Agreement (iii) for any reasonable
         expenses incurred by the Company if the Company is required to carry
         out the Agent's duties in accordance with the authority granted to the
         Agent under Managing General Agency Agreement, reference number
         VSC2004/72 (iv) or for any business risk as defined in this Agreement;

         B. To make payment to the Reinsurer of any amounts held in the Trust
         Account that exceeds one hundred and two percent (102%) of the actual
         amount required to fund the Reinsurer's entire obligations (as defined
         below) under this Agreement;

         C. Where the Company has received notification of termination of the
         Trust Account, and where the Reinsurer's entire obligations under this
         Agreement remain unliquidated and undischarged ten (10) days prior to
         such termination date, to withdraw amounts equal to such obligations
         and deposit such amounts in a separate account, in the name of the
         Company, in any United States bank or trust company, apart from its
         general assets, in trust for such uses and purposes as specified in
         subparagraphs A. and B. above as may remain executory after such
         withdrawal and for any period after such termination date. "Event" is
         defined as a loss that occurs to the company due to any policy issued
         in accordance with the authority granted to the Company's Agent under
         the Managing General Agency Agreement, reference number VSC2004/72. An
         event is further defined but not limited to the following:



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1.       The Reisurer has become financially impaired. Financially impaired for
         purposes of this Article means the Reisurer's surplus has been reduced
         by ten percent (10%) or the Reinsurer has lost any part of, or has
         reduced its paid-up capital after the inception of this Agreement.

2.       The loss ratio under the Multiple Line Quota Share Reinsurance
         Agreement, AR15935, effective 12/1/2004 with Tokio Millennium Re Ltd.,
         Hannover Reinsurance (Ireland) Limited and E+S Reinsurance (Ireland)
         Limited is equal to or exceeds 63% at any point in time; 3. Upon
         knowledge of any ECO/XPL claim whether or not there is coverage under
         any other any other reinsurance agreement set forth in Exhibit A;

4.       When any reinsurer participating in the reinsurance agreements set
         forth in Exhibit A become financially impaired. Financially impaired
         for purposes of this Article means the reinsurer's surplus has been
         reduced by twenty percent (20%) or has lost any part of, or has reduced
         its paid-up capital since the inception of this Agreement;

5.       Upon knowledge of any potential arbitration or mediation with any other
         reinsurer participating in the reinsurance agreements set forth in
         exhibit A;



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6.       Any other loss, loss adjustment expense and/or business risk on
         policies reinsured hereunder that is net and unreinsured by the
         Company.

         "Obligations" of the Reinsurer is defined as the amount of loss the
Company may incur as a result of any of the "events" defined above and will be
equal to the greater of $1,000,000 or the actual reserve the Company will have
to report on its statutory financial statement.

     IF AN EVENT OCCURS PURSUANT TO THIS ARTICLE, THE COMPANY AND THE REINSURER
MAY MUTUALLY AGREE TO WAIVE THE REQUIREMENT THAT THE REINSURER FUND ITS
OBLIGATIONS. IF THE COMPANY DOES NOT AGREE TO WAIVE THIS REQUIREMENT, THE
REINSURER WILL IMMEDIATELY FUND ITS OBLIGATIONS IN ACCORDANCE WITH THIS ARTICLE.

         The issuing bank will have no responsibility whatsoever in connection
with the propriety of withdrawals made by the Company or the disposition of
funds withdrawn, except to ensure that withdrawals are made only upon the order
of properly authorized representatives of the Company.

         Once the Trust Account has been established, the Agent on behalf of the
Company will prepare and forward to the Reinsurer a monthly statement to reflect
the Reinsurer's obligations under this Agreement. If the statement shows that
the Reinsurer's share of such obligations exceeds the balance available through
the Trust Account, then the Reinsurer will, within five (5) days after receipt
of notice of such excess, make an adjustment to increase the amount available.
If the statement shows that the Reinsurer's share of such obligations is less
than the balance available through the Trust Account as of the statement date,
then the Company will, within ten (10) days after receipt of written request
from the Reinsurer, release such excess by making the appropriate adjustment.
However the balance in the Trust Account will never be less than $1,000,000.

         In event the Company and the Reinsurer cannot agree on the value of the
Reinsurer's obligations, they will mutually appoint an independent actuary
and/or appraiser to assess such obligations. Any expenses associated with the
appointment of an independent actuary and/or appraiser will be paid by the
Reinsurer.



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         When all known loss reserves have been settled or closed and incurred
but not reported loss reserves are reduced to zero, the Company and the
Reinsurer will mutually agree to terminate the Trust Account.

                                   ARTICLE IX
LOSS NOTICES AND SETTLEMENTS

         The Reinsurer agrees to abide by all disposition of claims, including
any ex gratia settlements, directed by the Company, the Agent on behalf of the
Company, or directed or amended by enactment or interpretation by any
legislative, regulatory, or judicial body.

         When so requested, however, the Company will afford the Reinsurer, at
the Reinsurer's own expense, an opportunity to be associated with the Company in
the defense of any claim, suit, or proceeding involving this Agreement, and the
Company and the Reinsurer will cooperate in every respect in such defense.

                                    ARTICLE X

EXTRA CONTRACTUAL OBLIGATIONS AND EXCESS LIMITS LIABILITY

         This Agreement will extend to cover 100% of any losses arising from
extra contractual obligations and/or excess limits liability.

         "Extra contractual obligations" means those liabilities not covered
under any other provision of this Agreement, including, but not limited to, any
punitive, exemplary, compensatory, or consequential damages, which arise from
business covered hereunder.

         "Excess limits liability" means any amount for which the Company would
have been contractually liable to pay had it not been for the limits of the
reinsured policy.



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                                   ARTICLE XI
INSOLVENCY

         In the event of the Company's insolvency, the reinsurance afforded by
this Agreement will be payable by the Reinsurer on the basis of the Company's
liability under the policies reinsured without diminution because of the
Company's insolvency or because its liquidator, receiver, conservator, or
statutory successor has failed to pay all or a portion of any claims, subject
however to the right of the Reinsurer to offset against such funds due
hereunder, any sums that may be payable to it by said insolvent Company in
accordance with the Offset Article. The reinsurance will be payable by the
Reinsurer directly to the Company or to its liquidator, receiver, conservator,
or statutory successor except (a) where this Agreement specifically provides
another payee of such reinsurance in the event of the Company's insolvency or
(b) where the Reinsurer, with the consent of the direct insured or insureds, has
assumed such policy obligations of the Company as direct obligations of itself
to the payees under such policies in substitution for the Company's obligation
to such payees.

         The Company's liquidator, receiver, conservator, or statutory successor
will give written notice of the pendency of a claim against the Company under
the policies reinsured within a reasonable time after such claim is filed in the
insolvency proceeding. During the pendency of such claim, the Reinsurer may
investigate said claim and interpose in the proceeding where the claim is to be
adjudicated, at its own expense, any defense that it may deem available to the
Company or to its liquidator, receiver, conservator, or statutory successor. The
expense thus incurred by the Reinsurer will be chargeable against the Company,
subject to court approval, as part of the expense of conservation or liquidation
to the extent that such proportionate share of the benefit will accrue to the
Company solely as a result of the defense undertaken by the Reinsurer. Where two
or more reinsurers are involved in the same claim, and a majority in interest
elect to interpose defense to such claim, the expense will be apportioned in
accordance with the terms of this Agreement as though such expense had been
incurred by the Company.



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         In the event of the receivership, conservatorship or insolvency of the
Reinsurer, the Company may immediately exercise its rights under Article VIII,
Trust Account.

         In the event of insolvency of the Company, the Reinsurer will have all
rights, as more fully set forth in Section 173 of the Illinois Insurance Code,
as amended.

                                   ARTICLE XII
MEDIATION AND ARBITRATION

         If any dispute arises between the Company and the Reinsurer with
reference to the interpretation, performance, or breach of this Agreement
(whether the dispute arises before or after termination of this Agreement), such
dispute, if not resolved by the parties, must be submitted to nonbinding
mediation. If such dispute is not resolved by nonbinding mediation within sixty
(60) days it will then be submitted for decision to a panel of three
arbitrators. Notice requesting arbitration will be in writing and sent certified
or registered mail, return receipt requested.

         One arbitrator will be chosen by each party and the two arbitrators
shall, before instituting the hearing, choose an impartial third arbitrator who
will preside at the hearing. If either party fails for any reason to appoint its
arbitrator within thirty (30) days after being requested to do so by the other
party, the latter, after ten (10) days notice by certified or registered mail of
its intention to do so, may appoint the second arbitrator. If the two
arbitrators are unable to agree upon the third arbitrator within thirty (30)
days of their appointment, the third arbitrator will be selected from a list of
six individuals (three named by each arbitrator) by a judge of the United States
District Court having jurisdiction over the geographical area in which the
arbitration is to take place, or if that court declines to act, the state court
having general jurisdiction in such area.



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         All arbitrators will be active or retired disinterested officials of
insurance or reinsurance companies, not under the control or management of
either party to this Agreement and will not have personal or financial interests
in the result of the arbitration.

         Within thirty (30) days after notice of appointment of all arbitrators,
the panel will meet and determine timely periods for briefs, discovery
procedures and schedules for hearings.

         The panel will be relieved of all judicial formality and will not be
bound by the strict rules of procedure and evidence. Unless the panel agrees
otherwise, arbitration will take place in Chicago, Illinois, but the venue may
be changed when deemed by the panel to be in the best interest of the
arbitration proceeding. Insofar as the arbitration panel looks to substantive
law, it will consider the law of the State of Illinois. The decision of any two
arbitrators when rendered in writing will be final and binding. The panel is
empowered to grant interim relief, as it may deem appropriate.

         The panel will interpret this Agreement as an honorable engagement
rather than merely a legal obligation and will make its decision considering the
custom and practice of the applicable insurance and reinsurance businesses
within sixty (60) days following the termination of the hearing unless the
parties consent to an extension. Judgement upon the award may be entered in any
court having jurisdiction thereof.

         Punitive damages will not be awarded. The arbitrators may, however, at
their discretion award such other costs and expenses as they deem appropriate,
including but not limited to attorneys' fees, the cost of arbitration, and
arbitrators' fees to the extent permitted by law.

         The Reinsurer agrees to hold harmless and fully indemnify the Company
in respect all costs and expenses, of whatsoever nature, incurred or suffered by
the Company in the event arbitration proceedings are initiated between the
Reinsurer and the Agent that involve no dispute of substance between the Company
and the Reinsurer.



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                                  ARTICLE XIII
SERVICE OF SUIT

         (This Article applies if the Reinsurer is unauthorized in any state,
territory, or district of the United States of America that has jurisdiction
over the Company and in which a subject suit has been instituted. This Article
is not intended to conflict with or override the parties' obligation to
arbitrate their disputes in accordance with Article XII, Mediation and
Arbitration.)

         In the event the Reinsurer fails to pay any amount claimed due
hereunder, the Reinsurer, at the request of the Company, will submit to the
jurisdiction of any court of competent jurisdiction within the United States and
will comply with all requirements necessary to give that court jurisdiction.
Nothing in this Article constitutes or should be understood to constitute a
waiver of the Reinsurer's right to commence an action in any court of competent
jurisdiction in the United States, to remove an action to a United States
District Court, or to seek a transfer of a case to another court as permitted by
the laws of the United States or of any state in the United States. Service of
process in such suit may be made upon ___________________ Attention:___________.

         In any suit instituted against it upon this Agreement, the Reinsurer
will abide by the final decision of such court or of any appellate court in the
event of an appeal.

         The above named are authorized and directed to accept service of
process on behalf of the Reinsurer in any such suit and/or upon the request of
the Company to give a written undertaking to the Company that they will enter a
general appearance upon the Reinsurer's behalf in the event such a suit is
instituted.


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         Further, pursuant to any statute of any state, territory, or district
of the United States that makes provision therefor, the Reinsurer hereby
designates the Superintendent, Commissioner, or Director of Insurance or other
officer specified for that purpose in the statute (or his successor or
successors in office) as its true and lawful attorney upon whom may be served
any lawful process in any action, suit, or proceeding instituted by or on behalf
of the Company or any beneficiary hereunder arising out of this Agreement, and
hereby designates the above named as the person to whom the said officer is
authorized to mail such process or a true copy thereof.

                                   ARTICLE XIV
INTEREST PENALTY

         The interest amounts provided for in this Article will apply to the
Reinsurer or to the Company in the following circumstances:

         A.       Loss payments owed by the Reinsurer to the Company will have a
                  due date to the Company as specified in Article VII, Reports
                  and Remittances, of this Agreement.

         B.       Payment of any premium will be due to the Reinsurer will have
                  a due date as specified in Article VII, Reports and
                  Remittances, of this Agreement.

         C.       Payment on return of premium, or any amounts not provided in
                  subparagraphs A. or B. above, will have the due date as
                  specified in this Agreement. If no due date is specified, the
                  due date will be ninety (90) days following the date of
                  billing.

         D.       Failure by the Reinsurer or the Company to comply with their
                  respective payment obligations within the time periods as
                  herein provided will result in a compound interest payment
                  payable at a rate equal to the 90-day Treasury Bill ask yield
                  as published in the Money Rate Section or any successor
                  section in the Midwest Edition of The Wall Street Journal on
                  the first business day following the date a remittance becomes
                  due, plus 1% per annum, to be compounded and adjusted
                  quarterly. Any interest which occurs pursuant to this Article
                  will be calculated by the party to which it is owed. The
                  accumulation of the number of days that any payment is past
                  due will stop on the date that the payment is received.


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<PAGE>

         E.       The validity of any claim or payment may be contested under
                  the provisions of this Agreement. If the debtor party prevails
                  in an arbitration or any other proceeding, there will be no
                  interest payment due. Otherwise, any interest will be
                  calculated and be due as outlined above.

         F.       The Reinsurer will advance payment of any claim it is
                  contesting. Should the Reinsurer prevail in the contest, the
                  Company will return such payment plus pay interest on same,
                  calculated from the date the Company received the advanced
                  payment as per the provisions of this Article.

         G.       Any interest which occurs pursuant to this Article may be
                  waived by the party to which it is owed. Further, any interest
                  which is calculated pursuant to this Article that is one
                  hundred dollars ($100) or less will be waived. Waiver of such
                  interest, however, will not affect the waiving party's rights
                  to similar interest for any other failure by the other party
                  to make payment when due under this Article.

         H.       Nothing in this Article will diminish any legal remedies that
                  either party may have against the other.


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                                   ARTICLE XV
                                  AGENT DEFAULT

         In the event the Underwriting Manager or any agent or general agent
(hereinafter called "Required Agent") appointed by the Company at the request of
the Underwriting Manager shall, whether by reason of bankruptcy or any other
cause, intentionally or unintentionally commit an act either of "Premium
Default" or of "Payment Default" as those terms are hereinafter defined), then
the consequences and remedies hereinafter provided in this Article shall apply.
"Premium Default" shall mean failure by a Required Agent to transmit to the
Company all or any portion of any premium for the placement of any policy or
coverage under any policy. "Payment Default" shall mean any misappropriation of
any of the Company's funds or the Reinsurer's funds, where such funds have been
under the control of the Required Agent.

         In the event of any Premium Default, Company shall be relieved of any
liability to remit to Reinsurer the corresponding reinsurance premium until such
time, if ever, as the amount of such Premium Default is received by the Company.
Also until such time, the insurance corresponding to such Premium Default shall
be deemed to have been ceded to the Reinsurer pursuant to this Agreement.
Notwithstanding such Premium, with respect to such premiums receivable by the
Company, the Company shall be entitled to payment of ceding commission, loss and
loss expenses and reimbursement for premium taxes, fees, assessments or residual
market loads of any kind imposed upon the Company pursuant to any law or
regulation as a result of policies reinsured hereunder.

         In the event of any Payment Default, the Company is relieved of any
liability to Reinsurer for any funds of Reinsurer which may have been
misappropriated, and the Reinsurer shall reimburse the Company for any funds of
the Company which have been misappropriated.


                                       19
<PAGE>

                                   ARTICLE XVI
COMMUTATION

         If mutually agreed by the Company and the Reinsurer, at the expiration
of this Agreement, or at any time thereafter, the Company may discharge the
Reinsurer from all further liability under the policies attaching during the
term of this Agreement. In event the Company and the Reinsurer cannot agree on
the capitalized value of the Reinsurer's liability on such policies, they will
mutually appoint an actuary and/or appraiser to assess such liability. The
payment by the Reinsurer of the amount so ascertained will constitute a complete
and final release of the Reinsurer in respect to its liability on such policies.
Any expenses associated with the appointment of an actuary and/or appraiser will
be paid by the Reinsurer.

                                  ARTICLE XVII
ACCESS TO RECORDS

         The Agent on behalf of the Company will place at the disposal of the
Reinsurer, at all reasonable times, and the Reinsurer, through its designated
representatives, will have the right to inspect, all books, records, and papers
of the Company in connection with this Agreement. At the conclusions of the
inspection, the Reinsurer will meet with and discuss the review with the Company
and will provide a written report of its findings within a reasonable time. The
Reinsurer, except with the express prior written consent of the Company, will
not directly or indirectly communicate, disclose, or divulge to any third party,
any knowledge or information that may be acquired either directly or indirectly
as a result of the inspection of the Company's books, records, and papers. The
restrictions as outlined in this Article will not apply to communications or
disclosures that the Reinsurer is required to make to its statutory auditors,
retrocessionaires, legal counsel, arbitrators involved in any arbitration
procedures under this Agreement, or disclosures required upon subpoena or other
duly-issued order of a court or other governmental agency or regulatory
authority. Expenses connected with any such inspection and any reproduction of
such records will be borne by the Reinsurer.


                                       20
<PAGE>

                                  ARTICLE XVIII
OFFSET
         The Agent on behalf of the Company and the Reinsurer hereunder will be
entitled to deduct from amounts due the other party under this Agreement any
amounts due itself from the other party under this Agreement only. In the event
of the insolvency of either party hereto, offset will only be allowed in
accordance with applicable law in the State of Illinois.

                                   ARTICLE XIX
CURRENCY

         All payments made by either party hereunder will be in United States
dollars.

                                   ARTICLE XX
ERRORS AND OMISSIONS

         Inadvertent delays, errors, or omissions made in connection with this
Agreement or any transaction hereunder will not relieve either party from any
liability that would have attached had such delay, error, or omission not
occurred.

                                   ARTICLE XXI
SALVAGE AND SUBROGATION

         The Reinsurer will be credited with its share of salvage or subrogation
recoveries (i.e. reimbursement obtained or recovery made by the Agent of behalf
of the Company, less the actual cost, excluding salaries of officials and
employees of the Company, of obtaining such reimbursement or making such
recovery) on account of claims and settlements involving policies reinsured
hereunder. If the recovery expense exceeds the amount recovered, the amount
recovered (if any) will be applied to the reimbursement of recovery expense and
the remaining expense will be borne by the Reinsurer.



                                       21
<PAGE>

                                  ARTICLE XXII
AMENDMENTS

         This Agreement may be altered or amended in any of its terms and
conditions by mutual consent of the Company and the Reinsurer by addenda hereto
or by an exchange of letters requesting acceptance of revised pages, special
acceptances, or changes in underwriting information pertaining to this
Agreement. Such addenda or letters will then constitute a part of this
Agreement.

                                  ARTICLE XXIII
GOVERNING LAW

         This Agreement will be governed and construed in accordance with the
laws of the State of Illinois.

                                  ARTICLE XXIV
ASSIGNMENT

         Neither party may assign its rights or responsibilities under this
Agreement without the prior written consent of the other party, which consent
will not be unreasonably withheld.

                                   ARTICLE XXV
SEVERABILITY

         If any provisions of this Agreement will be rendered invalid, illegal,
or unenforceable by the laws, regulations, or public policy of any state, such
provisions will be considered void in such state, but this will not affect the
validity, legality or enforceability of any other provisions of this Agreement
in that state, nor the validity, legality, or enforceability of such provisions
in any other jurisdiction.



                                       22
<PAGE>

                                  ARTICLE XXVI
FINANCIAL STATEMENTS

         The Reinsurer will provide quarterly financial statements to the
Company within thirty (30) days after it is required to file such statements in
accordance with applicable regulatory requirements.

                                  ARTICLE XXVII
HEADINGS

         The Article headings contained in this Agreement are for reference
purposes only and will not affect in any way the meaning or interpretation of
this Agreement.



                                       23
<PAGE>


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in duplicate by their duly authorized representatives.

Signed at Chicago, Illinois, this 1st  day of    March       2005
                                 ------      ----------------
VIRGINIA SURETY COMPANY, INC.
Signature:       /s/ Oriana Bakka
          ---------------------------------------------------
Title:           Senior Vice President
      -------------------------------------------------------
Attest:
       ------------------------------------------------------

FEIN Number: 36-3186541

NAIC Number: 40827

Signed at New York, New York, this  2nd  day of  March        2005
                                  -------      ---------------
TOWER INSURANCE COMPANY OF NEW YORK
Signature:       /s/ Marina Contiero
          ----------------------------------------------------
Title:           Vice President
      --------------------------------------------------------
Attest:
       -------------------------------------------------------

FEIN Number: 13-3548249

NAIC Number: 44300



                                       24
<PAGE>

                                    EXHIBIT A

Quota Share Reinsurance Agreement with Tokio Millennium Re Ltd., Hannover
Reinsurance (Ireland) Limited and E+S Reinsurance (Ireland) Limited,reference
numberAR15511, effective December 1, 2004 to December 31, 2005 12:01 a.m.
standard time.




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