                                                                          ACCEPTED
                                                                     07-15-00060-CV
                                                        SEVENTH COURT OF APPEALS
                                                                  AMARILLO, TEXAS
                                                                 6/4/2015 5:34:23 PM
                                                                    Vivian Long, Clerk



            NO. 07-15-00060-CV

                                                     FILED IN
                                              7th COURT OF APPEALS
                IN THE                          AMARILLO, TEXAS
           SEVENTH COURT OF                   6/4/2015 5:34:23 PM
                                                   VIVIAN LONG
               APPEALS                                CLERK
            AMARILLO, TEXAS

        JODY JAMES FARMS, JV,
                 Appellant,
                      V.
       THE ALTMAN GROUP, INC.
            AND LAURIE DIAZ,
                 Appellees.
_                                                               _
    Appeal from the 110th District Court of
           Floyd County, Texas
         Cause Number 10,422
           APPELLANT’S BRIEF
               June 4, 2015

               Respectfully submitted,
               JENKINS, WAGNON & YOUNG, P.C.
               P.O. Box 420
               Lubbock, TX 79408
               (806) 796-7351
               Fax: (806) 771-8755
               Jody D. Jenkins
               State Bar No. 24029634
               jjenkins@jwylaw.com
               ATTORNEYS FOR APPELLANT

    ORAL ARGUMENT IS REQUESTED
                 IDENTITY OF PARTIES AND COUNSEL

Judge Presiding at Trial:
The Honorable William P. Smith

Plaintiff and Appellant:
Jody James Farms, JV

Plaintiff’s Trial and Appellate Counsel:
Jody Jenkins
Jenkins, Wagnon & Young, P.C.
P.O. Box 420
Lubbock, Texas 79408

Defendants and Appellees:
The Altman Group, Inc. and Laurie Diaz

Defendants’ Trial and Appellate Counsels:
J. Paul Manning
Anna McKim
Field, Manning, Stone, Hawthorne & Aycock, P.C.
2112 Indiana Avenue
Lubbock, Texas 79410




                                     ii
                                         TABLE OF CONTENTS
                                                                        PAGE
IDENTITY OF PARTIES AND COUNSEL ................................................ ii

INDEX OF AUTHORITIES ..................................................................................iv

STATEMENT OF THE CASE................................................................... 1

ORAL ARGUMENT ...............................................................................................1

ISSUES PRESENTED ON APPEAL ........................................................ 2

STATEMENT OF FACTS ......................................................................................2

SUMMARY OF THE ARGUMENTS ................................................................... 4

ARGUMENTS AND AUTHORITIES................................................................... 6

ISSUE NUMBER 1

         Whether a non-party to an arbitration agreement can compel
         arbitration of claims that are not within the scope of the
         arbitration agreement ...................................................................................6

CONCLUSION.......................................................................................................19

PRAYER .................................................................................................................19

SIGNATURE ..........................................................................................................20

CERTIFICATE OF SERVICE ............................................................................20

CERTIFICATE OF COMPLIANCE...................................................................21

APPENDIX .............................................................................................................23



                                                           iii
                                        INDEX OF AUTHORITIES

Cases:                                                                                                                  Page

All-Tex Roofing, Inc. v. Greenwood Ins. Group, Inc., 73 S.W.3d 412 (Tex.
App.—Houston [1st Dist.] 2002, pet. denied) .........................................................17

Blumberg v. USAA Casualty Ins. Co., 790 So. 2d. 1061 (Fla. 2001) ......................16

Bosscorp, Inc. v. Donegal, Inc., 370 S.W.3d 68 (Tex. App.—Houston [14th
Dist.] 2012, no pet.) .................................................................................................13

Centex/Vestal v. Friendship W. Baptist Church, 314 S.W.3d 677 (Tex. App.—
Dallas 2010) .............................................................................................................18

Delfingen US-Texas, L.P. v. Valenzuela, 407 S.W.3d 791 (Tex. App.—El
Paso 2013) ........................................................................................................7, 8, 12

DeWitt Cnty. Elec. Coop., Inc. v. Parks, 1 S.W.3d 96 (Tex. 1999) ........................10

Ellman v. JC Gen. Contractors, 419 S.W.3d 516 (Tex. App. -- El Paso 2013,
no pet.)....................................................................................................................6, 7

Frost Nat'l Bank v. L & F Distribs., Ltd., 165 S.W.3d 310 (Tex. 2005) (per
curiam) .....................................................................................................................14

Great Am. Assur. Co. v. Sanchuck, LLC No. 8:10-CV-2568 –T-33AEP, 2012
U.S. Dist. LEXIS 7477 at * 20 (M.D. Fla. Jan. 23, 2012) .......................................16

G.T. Leach Builders, LLC v. Sapphire VP, LP, 2015 Tex. LEXIS 273 (Tex.
2015) ..............................................................................................................9, 10, 12

Gulf Oil Corp. v. Guidry, 327 S.W.2d 406 (Tex. 1959) ..........................................18

In re Dillard Dep't Stores, Inc., 186 S.W.3d 514 (Tex. 2006) .................................. 7

In re Kellogg & Root, Inc., 166 S.W.3d 732 (Tex. 2005) .................................12, 13

In re Labatt Food Serv., L.P., 279 S.W.3d 640 (Tex. 2009). .................................... 6

                                                              iv
In re Poly-America, L.P., 262 S.W.3d 337 (Tex. 2008) ............................................ 8

In re Weekley Homes, 180 S.W.3d 127 (Tex. 2005) ...........................................9, 10

In re Wells Fargo Bank, N.A., 300 S.W.3d 818 (Tex. App.—San Antonio
2009) ..........................................................................................................................7

J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223 (Tex. 2003) ......................7, 12, 14

Landmark Am. Ins. Co. v. Moulton Props., No. 3:05cv401/LAC, 2006 U.S.
Dist. LEXIS 73478 (N.D. Fla. July 19, 2006) .........................................................17

MCI Telecomms. Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647 (Tex.1999)........ 12

Nafta Traders, Inc. v. Quinn, 339 S.W.3d 84 (Tex. 2011) ......................................19

Perry Homes v. Cull, 258 S.W.3d 580 (Tex. 2008)................................................... 7

Rice v. Louis A. Williams & Assocs., 86 S.W.3d 329 (Tex. App.—Texarkana,
2002, pet. denied) ...............................................................................................16, 17

South Texas Water Authority v. Lomas, 223 S.W.3d 304 (Tex. 2007)....................12

Stolt–Nielsen S.A. v. AnimalFeeds Int’l Corp., 559 U.S. 662 (2010)......................19

Surplus, Inc. v. Home State Cnty. Mut. Ins. Co., No. 05-95-00007-CV, 1995
Tex. App. LEXIS 3305 at *13 (Tex. App.—Dallas Dec. 21, 1995, writ
denied) ......................................................................................................................14

Trinity Universal Ins. Co. v. Burnette, 560 S.W.2d 440 (Tex. App.—
Beaumont 1977) .......................................................................................................11

United Protective Servs., Inc. v. West Village Ltd. P'ship, 180 S.W.3d 430
(Tex. App.—Dallas 2005, no pet.)...........................................................................14

Statutes and Rules

9 U.S.C. § 10(a)(4) (2015) ................................................................................. 18, 19

Tex. Bus. & Com. Code Ann. §17.42(a) (West 2015) ............................................18

                                                               v
Tex. Bus. & Com. Code Ann. § 17.565 (West 2015) ........................................ 17, 18

Tex. Civ. Prac. & Rem. Code Ann. § 16.003 (West 2015) ..................................... 17

Tex. Civ. Prac. & Rem. Code Ann. §16.070 (West 2015) ......................................18

Tex. Civ. Prac. & Rem. Code Ann. § 171.021(a)(1) (West 2015) ............................ 7

Tex. Civ. Prac. & Rem. Code Ann. § 171.088 (West 2015) ............................. 18, 19

Tex. Const. Art. I, § 13 ............................................................................................19




                                                          vi
                         STATEMENT OF THE CASE

    James filed suit against Altman and Diaz for breach of fiduciary duty and

violations of the Texas Deceptive Trade Practices Act. CR 3-6. After Altman and

Diaz answered with a general denial, they filed their Motion to Compel Arbitration.

CR 9-17. James filed its Response to Motion to Compel Arbitration denying that

an agreement to arbitrate existed and attached evidence. CR Supp. 4-76. After the

trial court granted the Motion to Compel Arbitration, CR 27, James asked the trial

court to reconsider or clarify its ruling to compel arbitration. CR 28-36. The trial

court ultimately denied the motion to reconsider and the case proceeded to

arbitration. CR 41.

    After arbitration, Altman and Diaz filed their Petition to Confirm and Enforce

Final Arbitration Award and for Attorney Fees and Costs. CR 42-54. James

objected to the Petition to Confirm and Enforce Final Arbitration Award and filed

its Motion to Vacate and to Set Aside Arbitration Award. CR 57-73. The trial

court entered its Final Judgment on January 20, 2015. CR 125-126.            James

subsequently filed its notice of appeal on February 17, 2015. CR 128.

                              ORAL ARGUMENT

      Oral argument is requested in this matter.



                                         1
                              ISSUE PRESENTED

ISSUE NUMBER 1:

      Whether a non-party to an arbitration agreement can compel arbitration
      of claims that are not within the scope of the arbitration agreement.

                           STATEMENT OF FACTS

      Altman is an independent insurance agency who markets for Rain and Hail,

L.L.C. (Rain and Hail); Rain and Hail is owned and controlled by ACE Property

and Casualty Insurance Company; ACE Property and Casualty Insurance Company

issues crop insurance policies. CR Supp. 21 (stating in the caption of the Multiple

Peril Crop Insurance Application and reporting form that Rain and Hail services

ACE’s policies; the document also bears the signature of Barry Altman in his

capacity as “Licensed Agent”); see also CR Supp. 56 (Diaz testifying that Rain and

Hail hired the insurance adjuster). Altman has been James’s agent for crop

insurance since approximately 2008.      CR Supp. 51-58.     Diaz is a registered

insurance agent employed by Altman where she also serves as Altman’s

Operations Manager; she has been employed with Altman for the entire time that

Altman has been James’s agent.      CR Supp. 52. At some point before James

incurred a loss, Diaz became involved with James’s 2010 crop insurance policy.

CR Supp. 53. Sometime thereafter, James incurred a loss on its insured crop during

the policy period. CR Supp. 55.
                                        2
       James purchased a Crop Revenue Coverage Insurance Policy (the “Policy”

attached as Exhibit 4 to the Appendix of this Brief) from Rain and Hail via his

agent Altman to indemnify against loss on its 2010 milo crop. See CR Supp. 21;

25-50. The Crop Revenue Coverage Insurance Policy required Rain and Hail to

indemnify James for any loss that arose under the Policy. CR Supp. 25-50. The

arbitration clause contained in the Policy with Rain and Hail stated as follows at

paragraph 20:

       If you and we fail to agree on any determination made by us except
       those specified in Section 20(d), the disagreement may be resolved
       through mediation in accordance with Section 20(g). If resolution
       cannot be reached through mediation, or you and we do not agree to
       mediation, the disagreement must be resolved through arbitration.

CR Supp. 44.

       In November of 2010, James incurred a loss on an insured milo crop. CR

Supp. 23. After the loss was incurred, Diaz was notified by telephone of the loss.

CR Supp. 23. Based on James’s relationship and prior dealings with Altman and

Diaz, James did not follow up his claim in writing. CR Supp. 54-55 (Diaz explains

that it is common for clients to call in a claim without confirming it in writing).

After receiving evidence of the loss, Diaz delayed turning in the claim. CR Supp.

56 (Diaz explained that she didn’t turn in the claim and send it to Rain and Hail

until later).

                                        3
      Eventually, Rain and Hail denied James’s claim alleging it was untimely

submitted. CR Supp. 64-68. Rain and Hail explained that because the claim was

untimely filed, it was unable “to make the necessary and required loss

determinations.” CR Supp. 64.

      With no other recourse for his injury, James subsequently filed suit against

Altman and Diaz for their inaction in submitting the claim. CR 3-6. Against the

objection of James, the trial court compelled arbitration between James and

Altman and Diaz. CR 27; CR 41. The trial court based its decision on James’s

previous agreement with Rain and Hail to arbitrate disputes over determinations

made by Rain and Hail. CR 27; CR 41. Ultimately, James unwillingly participated

in the compelled arbitration and the arbitrator ruled against James. CR 52-54.

James now appeals the trial court’s order compelling arbitration and later enforcing

the arbitration award.

                         SUMMARY OF ARGUMENT

      The trial court’s decision to compel arbitration and subsequently enforce the

arbitration award should be reversed and this case remanded for trial.

      First, there was no agreement to arbitrate between James and Altman and

Diaz. The only arbitration agreement that James entered into was with Rain and

Hail. Further, James did not agree to arbitrate with parties outside of its contract

                                         4
with Rain and Hail. Altman and Diaz could not possibly be a party to the

arbitration agreement because Altman and Diaz could not make a determination

under the Policy, and are not agents of Rain and Hail for the purposes of making

determinations under the Policy.

       Second, James is not estopped from denying the enforceability of the

arbitration agreement. James never sought a direct benefit under the Policy from

Altman and Diaz. Instead, James filed the instant claims based on a breach of

Altman and Diaz’s fiduciary duty and under the Texas Deceptive Trade Practices

Act.

       Third, Altman and Diaz are not third-party-beneficiaries who can enforce the

arbitration agreement. Altman and Diaz were only incidental third-party-

beneficiaries to the contract between James and Rain and Hail. There was never

any intent on behalf of James or Rain and Hail to directly benefit Altman and Diaz

through the Policy.

       Fourth, James’s claims arose outside the scope of the otherwise

unenforceable arbitration agreement. The arbitration agreement to which James

agreed covered only determinations made by the insurance company providing

insurance. The whole basis of James’s claims is that a determination was never

made due to Altman and Diaz’s breach of their duties.

                                         5
      Fifth, the trial court could not rewrite the arbitration agreement to bring

James’s claims within its scope. The arbitration clause at issue contemplated

review by the Federal Crop Insurance Corporation, which could not review

determinations by private insurance contractors; and set a one year limitation

period in violation of Texas law.

      Last, the trial court erred by enforcing an arbitration award which the

arbitrator had no authority to issue under either the Federal Arbitration Act or the

Texas Arbitration Act.

                         ARGUMENTS & AUTHORITIES

ISSUE NUMBER 1:

      Whether a non-party to an arbitration agreement can compel
      arbitration of claims that are not within the scope of the arbitration
      agreement.

      1.     Standard of Review

      A court reviewing a trial court's decision to grant a motion to compel

arbitration reviews the trial court’s decision under an abuse of discretion standard.

Ellman v. JC Gen. Contractors, 419 S.W.3d 516, 520 (Tex. App. -- El Paso 2013,

no pet.). Under this standard, the reviewing court must defer to a trial court's

factual determinations if they are supported by evidence, and must review a trial

court's legal determinations de novo. In re Labatt Food Serv., L.P., 279 S.W.3d

                                         6
640, 643 (Tex. 2009). Ellman, 419 S.W.3d at 520.

      2.    The trial court erred by granting Appellees’ Motion to
            Compel Arbitration because there was not an agreement
            to arbitrate between James and Altman and Diaz.

      A party seeking to compel arbitration must establish the existence of a valid

arbitration agreement. Tex. Civ. Prac. & Rem. Code Ann. § 171.021(a)(1) (West

2015). “The burden of establishing the existence of a valid and enforceable

arbitration agreement includes proving that the party seeking to compel arbitration

was a party to the agreement or had the right to enforce the arbitration agreement.”

In re Wells Fargo Bank, N.A., 300 S.W.3d 818, 824 (Tex. App.—San Antonio

2009).

      Under both the Federal Arbitration Act and the Texas Arbitration Act, state

contract law principles determine whether a valid arbitration agreement exists. J.M.

Davidson, Inc. v. Webster, 128 S.W.3d 223, 227 (Tex. 2003); Delfingen US-Texas,

L.P. v. Valenzuela, 407 S.W.3d 791, 797 (Tex. App.—El Paso 2013). The

determination of whether the parties agreed to submit the claims to arbitration

depends on an interpretation of the parties’ contracts, which is reviewed de novo.

See Id. (citing In re Dillard Dep't Stores, Inc., 186 S.W.3d 514, 515 (Tex. 2006);

J.M. Davidson, 128 S.W.3d at 227).

      Arbitration agreements are not more enforceable than other contracts. Perry

                                         7
Homes v. Cull, 258 S.W.3d 580, 597 (Tex. 2008). No presumption in favor of

arbitration exists when a state court assesses whether a valid and enforceable

arbitration agreement exists under Texas law. In re Poly-America, L.P., 262

S.W.3d 337, 347 (Tex. 2008). In fact, a party seeking to compel arbitration is not

entitled to a presumption favoring arbitration until they prove that a valid

arbitration agreement exists. Delfingen, 407 S.W.3d at 797.

      In the case at bar, no valid and enforceable arbitration agreement exists

between the parties. In fact, the only agreement James entered into on the subject

matter at issue was with Rain and Hail. See CR Supp. 25-50. The Policy expressly

states that the words “you” and “your” refer to the named insured, which is James;

and the words “we,” “us,” and “our” refer to the “insurance company providing

insurance,” which is Rain and Hail. CR Supp. 25.

      The only mention of “insurance agent” within the Policy is in the beginning

paragraph and under “Your Duties:” “All notices required in this section that must

be received by us within 72 hours may be made by telephone or in person to your

crop insurance agent but must be confirmed in writing within 15 days,” with

“your” referring to the named insured under the Policy. CR Supp. 25, 38-39.

Because the insurance agent is not defined as a party under the Policy and is only

referenced in passing, the trial court’s conclusion that a non-party to the arbitration

                                          8
agreement in the Policy could enforce it is erroneous.

      Furthermore, the arbitration clause in the Policy could not possibly cover

Altman and Diaz, because Altman and Diaz could not, by their own admission,

make a determination. CR Supp. 56 (Diaz stated that, “Once the claim is turned in,

Federal crop rules says that the agent can no longer be involved.”). The arbitration

clause specifically and unambiguously covered only “any determination made by

us,” with “us” being defined by the Policy as “the insurance company providing

insurance.” CR Supp. 25, 44. Therefore, because Altman and Diaz were neither an

“insurance company providing insurance” nor a person with the capability of

making a determination, there was no valid and enforceable agreement between

James and Altman and Diaz.

      3.     The arbitration agreement cannot be enforced by Altman
             and Diaz through estoppel.

      James did not seek a direct benefit from Altman and Diaz through the

Policy. Although a party that seeks a direct benefit under a contract which includes

an arbitration clause cannot deny that the arbitration clause applies to a non-

signatory, independent claims are not subject to this defense. G.T. Leach Builders,

LLC v. Sapphire VP, LP, 2015 Tex. LEXIS 273 *54 (Tex. 2015). “Whether a claim

seeks a direct benefit from a contract containing an arbitration clause turns on the

substance of the claim.” Id. (quoting In re Weekley Homes, 180 S.W.3d 127, 131-
                                         9
32 (Tex. 2005)).

      It is not enough, however, that the party's claim ‘relates to’ the
      contract that contains the arbitration agreement. Instead, the party
      must seek “to derive a direct benefit”—that is, a benefit that “stems
      directly”—from that contract. The claim must “depend on the
      existence” of the contract, and be unable to “stand independently”
      without the contract. The alleged liability must “arise[] solely from
      the contract or must be determined by reference to it.”

G.T. Leach Builders, LLC, at *55 (internal citations omitted).

      “[T]he fact that the claims would not have arisen but for the existence of the

. . . contract is not enough to establish equitable estoppel.” Id. at *59. “‘[W]hen the

substance of the claim arises from general obligations imposed by state law,

including statutes, torts and other common law duties, or federal law,’” rather than

from the contract, ‘direct benefits’ estoppel does not apply, even if the claim refers

to or relates to the contract.” Id. at *55 (emphasis added) (internal citations

omitted); see also Weekley Homes, 180 S.W.3d at 132; DeWitt Cnty. Elec. Coop.,

Inc. v. Parks, 1 S.W.3d 96, 105 (Tex. 1999) (“The measure of damages, standing

alone, is not always determinative of whether a tort claim can co-exist with a

breach of contract claim).

      Here, the substance of James’s claim arises under Texas common law and

the Deceptive Trade Practices Act. “‘A local agent . . . owes his clients the greatest

possible duty. He is the one the insured looks to and relies upon. Most people do

                                          10
not know what company they are insured with.’” Trinity Universal Ins. Co. v.

Burnette, 560 S.W.2d 440, 442 (Tex. App.—Beaumont 1977) (emphasis added).

The substance of James’s claim is the breach of this duty, which James has

characterized as a “fiduciary duty,” and the breach of the duty imposed by the

Deceptive Trade Practices Act. See CR 4-5.

      James specifically claimed that Altman and Diaz “breached their fiduciary

duty to Plaintiff by failing to timely submit the crop loss claim to Rain and Hail,

LLC.” CR 4. Altman and Diaz’s fiduciary duty is based on their relationship and

prior dealings with James, where Altman and Diaz would submit James’s claims

based on a notification of the claim by telephone without a confirmation by

writing. CR Supp. 54-55. It is the breach of this duty, upon which James based part

of its claims. Such duties are independent of the Policy and apply to James’s

relationship with its insurance agent and not to the Policy.

      Because Altman and Diaz’s liability does not arise from the Policy, estoppel

does not mandate arbitration of the claims asserted by James. In fact, the only

duties under the Policy are referred to as “Your Duties,” which refer to the “named

insured,” and “Our Duties,” which refer to the “insurance company providing

insurance.” CR Supp. 25, 38-39. There are no duties allocated by the Policy to

Altman and Diaz, as an insurance agency and James has not sued for any breach of

                                          11
the Policy.

      4.      Altman and Diaz are not third party beneficiaries that can
              enforce the arbitration clause.

      Under certain circumstances, which are not present here, third party

beneficiaries can enforce an arbitration agreement even though they are not parties

to the agreement. See In re Kellogg & Root, Inc., 166 S.W.3d 732, 739 (Tex.

2005); see also G.T. Leach Builders, LLC at *43. However, the third party

beneficiary must be able to enforce the contract through state contract law

principles. See J.M. Davidson, 128 S.W.3d at 227; Delfingen, 407 S.W.3d at 797.

To do so, the third party beneficiary must overcome the “presumption against

conferring third-party-beneficiary status on noncontracting parties.” South Texas

Water Authority v. Lomas, 223 S.W.3d 304, 306 (Tex. 2007).

      Under Texas law, incidental third-party-beneficiaries are unable to enforce

contract provisions. Id. “A third party may only enforce a contract when the

contracting parties themselves intend to secure some benefit for the third party and

entered into the contract directly for the third party's benefit.” Id. “The intent to

confer a direct benefit upon a third party ‘must be clearly and fully spelled out or

enforcement by the third party must be denied.’” Id. (quoting MCI Telecomms.

Corp. v. Tex. Utils. Elec. Co., 995 S.W.2d 647, 651 (Tex.1999)).

      Here, Altman and Diaz are at most incidental third-party-beneficiaries.
                                         12
There was no intent to confer a direct benefit upon Altman and Diaz by either

James or Rain and Hail. James entered into the contract with Rain and Hail only to

benefit itself via insurance for a crop, and Rain and Hail sought only to sale its

insurance products. CR Supp. 21, 25-50. The fact that Altman and Diaz might have

received a commission for facilitating the sale does not show a “clear and fully

spelled out” intent to directly benefit Altman and Diaz. In fact, Altman and Diaz

are not mentioned by name anywhere in the Crop Revenue Coverage Insurance

Policy. See CR Supp. 25-50. Thus, Altman and Diaz as incidental third-party-

beneficiaries are unable to enforce the arbitration provision between James and

Rain and Hail.

      5.     Even if there was an agreement between the parties to
             arbitrate, the trial court erred in compelling arbitration
             because James’s claims arose outside the scope of the
             arbitration clause.

      The determination of whether a claim is within the scope of the arbitration

clause is based on an interpretation of the parties’ contracts, which courts review

de novo. Bosscorp, Inc. v. Donegal, Inc., 370 S.W.3d 68, 75-76 (Tex. App.—

Houston [14th Dist.] 2012, no pet.). Disputes concerning the scope of an

arbitration agreement are generally resolved in favor of arbitration. In re Kellogg &

Root, Inc., 166 S.W.3d at 737. However, when construing a written contract, the

court’s primary concern is to ascertain the true intentions of the parties as
                                         13
expressed in the instrument. See J.M. Davidson, 128 S.W.3d at 229.

      Courts consider the entire writing and attempt to harmonize and give effect

to all the provisions of the contract by analyzing the provisions with reference to

the whole agreement. Frost Nat'l Bank v. L & F Distribs., Ltd., 165 S.W.3d 310,

312 (Tex. 2005) (per curiam); J.M. Davidson, 128 S.W.3d at 229. Courts should

assume the parties intended every provision to have some effect. See United

Protective Servs., Inc. v. West Village Ltd. P'ship, 180 S.W.3d 430, 432 (Tex.

App.—Dallas 2005, no pet.). And, only when the provisions of a contract appear to

conflict, should courts attempt to harmonize the provisions. See Id. However,

courts cannot rewrite an arbitration agreement to bring claims within its scope,

even if those claims are intertwined with issues covered by the arbitration

agreement. See Surplus, Inc. v. Home State Cnty. Mut. Ins. Co., No. 05-95-00007-

CV, 1995 Tex. App. LEXIS 3305 at *13 (Tex. App.—Dallas Dec. 21, 1995, writ

denied).

      The arbitration clause in the case at bar solely covered “determinations.” CR

Supp. 44-45. Specifically, the arbitration clause obligated the parties to arbitrate

disputes arising out of “determinations made by us,” defining “us” as “the

insurance company providing insurance.” CR Supp. 25, 44-45. The breach of duty

by James’s agents, Altman and Diaz, was not a determination under the Policy and

                                        14
falls outside the scope of the arbitration agreement. No provisions in the Policy

even discuss the duties of Altman and Diaz to James.

      Further, evidence of the inapplicability of the arbitration clause to the

dispute at hand are the provisions of the arbitration agreement that cannot apply as

written. Section 20(a)(1) of the insurance contract states that if there is a “dispute

[which] in any way involves a policy or procedure interpretation. . . you or we

must obtain an interpretation from [the Federal Crop Insurance Corporation

“FCIC”] in accordance with 7 CFR part 400. CR Supp. 45. However, review by

the FCIC is not allowed for determinations made by private insurance contractors

such as Altman and Diaz. 7 CFR 400.91.

      In the instant suit, James has alleged that Altman and Diaz breached a duty

to it by failing to report a claim. CR 4. If Section 20(a)(1) is applied, Altman and

Diaz’s alleged conduct could be subject to review by the FCIC, which, by law,

cannot review the decisions made by private insurance contractors such as Altman

and Diaz.

      Another example of the error created by the application of the Rain and Hail

Arbitration Clause is that Section 20(b) requires arbitration to occur within 1 year

of the date “we denied your claim or rendered the determination with which you

disagree.” CR Supp. 44. Altman and Diaz did not deny James’s claims or render a

                                         15
determination with which he disagreed. CR Supp. 56 (Diaz stated that, “Once the

claim is turned in, Federal crop rules says that the agent can no longer be

involved.”). The denial of coverage was made by Rain and Hail prior to this suit

being initiated. CR Supp. 60-62. It was not until this dispute was resolved through

the first arbitration that James’s damages could be ascertained against Altman and

Diaz. See Great Am. Assur. Co. v. Sanchuck, LLC No. 8:10-CV-2568 –T-33AEP,

2012 U.S. Dist. LEXIS 7477 at * 20 (M.D. Fla. Jan. 23, 2012); Rice v. Louis A.

Williams & Assocs., 86 S.W.3d 329, 337 (Tex. App.—Texarkana, 2002, pet.

denied).

      Negligence claims maintained by first-party insureds against insurance

agents do not ripen until the Plaintiff’s interests are confronted with a specific and

concrete risk of harm. Rice v. Louis A. Williams & Assocs., 86 S.W.3d 329, 337

(Tex. App.—Texarkana 2002, pet denied). See also Great Am. Assur. Co. v.

Sanchuk, LLC, No. 8:10-cv-2568-T-33AEP, 2012 U.S. Dist. LEXIS 7477 at *20

(M.D. Fla. Jan. 23, 2012) (finding that a negligence cause of action against an

insurance agent accrues at the conclusion of a related or underlying proceeding

because a plaintiff cannot make a claim against an insurance agent for negligence

while simultaneously claiming policy coverage) (emphasis added); citing Blumberg

v. USAA Casualty Insurance Co., 790 So. 2d. 1061, 1065 (Fla. 2001) and

                                         16
Landmark Am. Ins. Co. v. Moulton Props., No. 3:05cv401/LAC, 2006 U.S. Dist.

LEXIS 73478 (N.D. Fla. July 19, 2006).

      Although the issues in the case at bar do not revolve around a limitations

issue like the cases cited above, James had at least a two year period in which to

file suit under Texas law for the claims in the instant suit. Tex. Bus. & Com. Code

Ann. § 17.565 (West 2015); Tex. Civ. Prac. & Rem. Code Ann. § 16.003 (West

2015). The arbitration agreement conflicts with that law. See CR Supp. 60-62

(denying James’s arbitration claim due to Diaz’s negligence in failing to timely file

James’s crop loss claim on April 10, 2012). See CR Supp. 63-68 (letter denying

coverage on April 26, 2011). It would be impractical for James to be required to

file suit before the determination was made because there was always a chance, no

matter how remote, that the arbitrator would find for James. Rice v. Louis A.

Williams & Assocs., 86 S.W.3d, at 339 (citing All- Tex Roofing, Inc. v. Greenwood

Ins. Group, Inc., 73 S.W.3d 412 (Tex. App.—Houston [1st Dist.] 2002, pet.

denied). In any event, limitations was not held to preclude James’s recovery in the

second arbitration and the clause had to be rewritten by the arbitrator or the court to

avoid that improper result.

      Specifically, Section 20(b)(1) provides that arbitration must be instituted

within one year of denial of the claim or the rendering of a determination. See CR

                                          17
Supp. 44. The DTPA specifically provides a two year statute of limitations period

for DTPA claims, Tex. Bus. & Com. Code Ann. § 17.565 (West 2015), and waiver

of any subsection under the DTPA is against public policy. Id. at 17.42(a); see also

Tex. Civ. Prac. & Rem. Code Ann. §16.070 (West 2015) (precluding a contract

which limits the statute of limitations to less than 2 years). Although not asserted

by the parties as a defense, enforcement of the arbitration clause as written required

a re-writing of its terms which cannot be done, and which would be against public

policy. Therefore, the only way the James’s claims could be within the scope of the

arbitration clause, was for the court or arbitrator to rewrite the arbitration clause

itself.

          6.    The arbitrator had no authority to enter an award relating
                to this case. Thus, the trial court abused its discretion in
                enforcing the arbitration award.

          Under both the Texas Arbitration Act and the Federal Arbitration Act, an

arbitrator cannot issue a decision on matters outside the scope of the arbitration

agreement. See Tex. Civ. Prac. & Rem. Code Ann. § 171.088 (West 2015); 9

U.S.C. § 10(a)(4) (2015). An arbitrator has no authority to issue a decision when

parties have not agreed to arbitrate claims because an arbitrator derives their power

from the arbitration agreement itself. Centex/Vestal v. Friendship W. Baptist

Church, 314 S.W.3d 677, 684 (Tex. App.—Dallas 2010) (citing Gulf Oil Corp. v.

                                          18
Guidry, 327 S.W.2d 406, 408 (Tex. 1959)); Nafta Traders, Inc. v. Quinn, 339

S.W.3d 84, 90 (Tex. 2011) (quoting Stolt–Nielsen S.A. v. AnimalFeeds Int’l Corp.,

559 U.S. 662, 682 (2010)). Both Texas law and federal law require vacatur of an

arbitration award when an arbitrator exceeds their authority. Tex. Civ. Prac. &

Rem. Code Ann. § 171.088 (West 2015); 9 U.S.C. § 10(a)(4) (2015).

      Here, the arbitrator exceeded his authority by entering an award where no

agreement to arbitrate existed and the scope of the arbitration agreement did not

cover the disputes. See infra Part I.A-E. Thus, because the arbitrator exceeded his

authority in entering an award, the trial court abused its discretion when it enforced

the arbitration award.

                                  CONCLUSION

      The right to open access to the courts is a fundamental right in Texas. See

Tex. Const. Art. I, § 13. Here, that right was violated when the trial court

erroneously compelled James to arbitrate and when the trial court enforced the

arbitration award against James. Justice requires that this Court reverse the trial

court’s order enforcing the arbitration award and remand of this case for trial.

                                     PRAYER

      WHEREFORE, Appellant, Jody James Farms, J.V., prays that the Court

reverse the trial court’s decision to compel arbitration and enforce the arbitration

                                         19
award, and remand this case for a new trial.

                                      Respectfully submitted,

                                      JENKINS, WAGNON & YOUNG, P.C.

                                      /s/ Jody D. Jenkins
                                      JODY JENKINS
                                      State Bar No. 24029634
                                      P.O. Box 420
                                      Lubbock, Texas 79408
                                      (806) 796-7351
                                      Fax: (806) 771-8755
                                      jjenkins@jwylaw.com
                                      ATTORNEYS FOR APPELLANT

                         CERTIFICATE OF SERVICE

       The undersigned certifies that a true and correct copy of the foregoing
 instrument has been served via the Court’s Electronic Filing System on this 4th
 day of June, 2015.

 J. Paul Manning
 Anna McKim
 Field, Manning, Stone, Hawthorne
  & Aycock, P.C.
 2112 Indiana Ave.
 Lubbock, Texas79410
                                      /s/ Jody D. Jenkins
                                      Jody D. Jenkins




                                         20
                CERTIFICATE OF COMPLIANCE

I hereby certify that the word count in Appellant’s Brief is 3,532 words.



                                 /s/ Jody D. Jenkins
                                 Jody D. Jenkins




                                  21
APPENDIX TO APPELLANT’S BRIEF




              22
                              APPENDIX TABLE OF CONTENTS

                                                                                     EXHIBIT
Order Granting Motion to Arbitrate (CR 27)....................................................... 1

Final Judgment (CR 125-127) ............................................................. 2

Notice of Appeal (CR 128) .......................................................................................3

Crop Revenue Coverage (CRC) Insurance Policy (CR Supp. 25-50) ................. 4

9 U.S.C. § 10(a)(4) (2015).........................................................................................5

Tex. Bus. & Com. Code Ann. §17.42(a) (West 2015) ............................................ 6

Tex. Bus. & Com. Code Ann. § 17.565 (West 2015) ............................................. 7

Tex. Civ. Prac. & Rem. Code Ann. § 16.003 (West 2015) .................................... 8

Tex. Civ. Prac. & Rem. Code Ann. §16.070 (West 2015) ..................................... 9

Tex. Civ. Prac. & Rem. Code Ann. § 171.021(a)(1) (West 2015).......................10

Tex. Civ. Prac. & Rem. Code Ann. § 171.088 (West 2015) ................................11

Tex. Const. Art. I, § 13...........................................................................................12




                                                        23
806-792-1048
                                                                                              10:38:35a.m.   06-27-2013        3/3




                                                                      No.l0,422

          JODY JAMES FARMS, JV                                            §   IN THE II om DISTRICT COURT
                                                                          §
          v.                                                             §    OF
                                                                         §
          THE ALTMAN GROUP, INC. AND                                     §
          LAURIEDIAZ                                                     §    FLOYD COUNTY, TEXAS


                                      ORDER GRANTING MOTION TO ARBITRATE


                    ON TIDS the 20'11 day ofMay, 2013, the Court considered the Motion of Defendants, THE

          ALTMAN GROUP, INC. AND LAURIE DIAZ, to Compel Arbitration and, after considering the

          pleadings, affidavit, evidence, and the argument of counsel, the Court hereby grants said motion.

                    IT IS THEREFORE ORDERED that the Motion of Defendants, THE ALTMAN GROUP,

          INC. AND LAURIE DIAZ to arbitrate this matter is hereby in all things GRANTED.

                    SIGNED       this..$-y of                  c,LY~-t ·           .
                                                                                   June, 2013. . ·


                                                                 ..   ~:~
                               FILED                                   JUDGE PRESIDING
                      Pcdfg~
                     District Clerk, Floyd Co1.1nty, 'f.9xa8

               By   '-22-WE                       . L;/~
                                                                                                                          -.




                                                                       EXHIBIT 1                                                27
8067921048                                                                           12:38:02 p.m.   01-16-2015            2/3




                                                         No. 10,422

             JODY JAMES FARMS, N                           §       IN THE llOTH DISTRICT COURT
                                                           §
             v.                                            §       OF
                                                           §
             THE ALTMAN GROUP, INC. AND                    §
             LAURIEDIAZ                                    §      FLOYD COUNTY, TEXAS


                                                   FINAL JUDGMENT


                     On this day came on to be heard the above-entitled and numbered cause wherein JODY
             JAMES FARMS, JV is Plaintiff and THE ALTMAN GROUP, INC. and LAURIE DIAZ, are the
         Defendants in the above entitled and numbered cause. The Court has read the pleadings and the
             papers on file, has considered the announcement of the parties and determined that it ·had
             jurisdiction over the subject matter and the parties to this proceeding. The Court is of the opinion
             that upon consideration of Defendants' Petition to Confirm and Enforce Final Arbitration Award
             and Plaintiff, JODY JAMES FARMS, JV.'s, Motion to Vacate Arbitration Award and all
             responses, briefs in support, exhibits and replies, if any, respectively thereto, it is hereby
             ORDERED and DECREED that Defendants' Petition to Confirm and Enforce Final Arbitration
             Award is GRANTED and the clerk is ordered to enter a judgment in favor of Defendants and
             against Plaintiff, JODY JAMES FARMS, JV and that Plaintiff, JODY JAMES FARMS, JV take
             nothing and all court costs are assessed against Plaintiff, JODY JAMES FARMS, JV. The judgment
             is to accrue interest at the rate of 5.00% per annum from the date of judgment until paid, plus all
             costs of court.

                     IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Plaintiff's Motion
             to Vacate the Arbitration Award is DENIED.

                     IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendants request
             for attorney's fees is DENIED.




             Final Judgment                                                                                 Page 1




                                                       EXHIBIT 2                                                     125
.   8067921048                                                                         12:38:26 p.m.   01-16-2015            3/3




                         IT IS, THEREFORE, ORDERED, ADJUDGED, AND DECREED that Defendants,
                 THE ALTMAN GROUP, INC. and LAURIE DIAZ have judgment against Plaintiff, JODY
                 JAMES FARMS, JV, as follows:

                         1.     Plaintiff take nothing;
                        2.      All costs of court are taxed against Plaintiff, JODY JAMES
                                FARMS,JV;and
                        3.      Post judgment interest on all costs and fees incurred at five
                                percent (5%) per year from the date of this judgment.

                        IT IS, FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant shall
                 have all writs and processes as may be necessary to enforce this Judgment.

                        All relief not expressly granted herein is denied. This judgment is final, disposes of all
                 claims and all parties, and is appealable.

                        The court orders execution to issue for this judgment.
                                                   /L
                        SIGNED on this     diJ- day of January, 2015.




             Final Judgment                                                                                   Page 2




                                                              EXHIBIT 2                                                126
8067921048                                                                        08:47: 13 a.m.   01-15-2015            2/4



             January 15, 2015
             Page2

                                                   Very truly yours,

                                                   FJELD, MANNlNG, STONE,
                                                   HAWTHORNE & AYCOCK, P.C.

                                                   ~."?~N\~
                                                   J.PaulManning        ~~
             JPM:slm

             Enclosure

                    Fax: 771-8755
                    E-Mail jjenkins@jwvlaw.com
             pc:    JODY JENKINS
                    JENKlNS, WAGNON & YOUNG, P.C.
                    P.O. Box420
                    Lubbock, TX 79408                                                FILED
                                                                         ~~·
                                                                       District   C~rk, Flo)O County, Thxae
                                                               ay   /-;I/J-c2LJ/5                   ~/LI~,;n_,
                                                                                                              u~




                                                 EXHIBIT 2                                                         127
                                                        No.10,422

JODY JAMES FARMS, JV                                          §         IN THE llOTH DISTRICT COURT
                                                              §
v.                                                            §         OF
                                                              §
THE ALTMAN GROUP, INC. AND                                    §
LAURIEDIAZ                                                    §         FLOYD COUNTY, TEXAS

                                               NOTICE OF APPEAL

TO THE HONORABLE JUDGE OF SAID COURT:

     ~
           Plaintiff,
         ~--_....- "'::
                        Jody }ame~f(lrms,
                     .---=--~  -   •. ---- -
                                 ~---·
                                             JY,~desiresJo- app~alJrom
                                             -.,.- ·- - __ . . __.. . .
                                                                  ~--   -.-.__..
                                                                                 the- FinaU!!4gme11t~gl!ed.by
                                                                                        --   ..      ~
                                                                                                              this_.:;__              ---~

Court on January 16,2015.

           Plaintiff, Jody James Farms, JV, appeals to the Seventh Court of Appeals, Amarillo, Texas.

                                                          zctfully            submitted,


                                                               YJENKINS
                                                          SBN: 24029634
                                                          Jenkins, Wagnon & Young, P.C.
                                                          P.O. Box420
                                                          Lubbock, Texas79408-0420
                                                          (806) 796-73 51
                                                          FAX (806) 771-8755
                                                          jjenkins@jwylaw.com
                                                          ATTORNEYS FOR PLAINTIFF

                                         CERTIFICATE OF SERVICE
                                           .-:--::-..: _,- ·---·---,.-...·- :~- . . . ---~.,...._......,..,..,.~...,........-~~-~=-__;._ " ____ _)
       This is to certify that a true and correct copy of the above and foregoing instrument has
been served upon the following via facsimile this 13th day ofFebruary, 2015.

J. Paul Manning
Field, Manning, Stone, Hawthorne & Aycock, P.C.
2112 Indiana A venue
Lubbock, Texas79410
Fax: (806)792-9148

                                                          J,_Jenkins

                                                                          FILED
                                                                  Poiit; .o,/IYJI-i~
                                                                         ((            '
                                                                OiS1r1tl Lie. •, Flutu Cour~y, T~

                                                              {) ~11 ·;)OJ;)                   i r. 11 ~
                                                       EXHIBIT 3                                                          128
..                                          CROP REVENUE COVERAGE (CRC) INSURANCE POUCY                                     2005-NCIS 7008-CRC
                                                    (This Is a continuous policy. Refer to section 3.)

      This Insurance policy Is reinsured by the Federal Crop Insurance Corporation (FCIC) under the authority of section 50B(h) of the
       )9deral Crop Insurance Act (Act), as amended (7 U.S.C. 1508(h)). All provisions of the policy and rights and responsibUities of the
      ,...arties are specifically subject to the Act. The provisions of the policy may not be waived or varied in any way by us, our Insurance
      agent or any other contractor or employee of ours or any employee of USDA unless the policy specificaHy authorizes a waiver or
      modification by written agreement. We will use the procedures (handbooks, manuals, memoranda and bulletins), as Issued by FCIC
      and published on the RMA website at htto:l/nna.usda.gov/ or a successor website, in the administration of this policy, including the
      adjustment of any loss or claim submitted hereunder. In the event that we cannot pay your loss because we are Insolvent or are
      otherwise unable to perfonn our duties under our reinsurance agreement with FCIC. your claim will be settled In accordance with the
      provisions of this policy and FCIC will be responsible for any amounts owed. No state guarantee fund will be liable for your loss.

      Throughout the policy, "you" and "your" refer to the named insured shown on the accepted application and "we," •us; and •our" refer to
      the insurance company providing insurance. Unless the context Indicates otherwise, use of the plural fonn of a word includes the
      singular and use of the singular form of the word includes the plural.

      AGREEMENT TO INSURE: In return for the payment of the premium, and subject to all of the provisions of this policy, we agree with
      you to provide the insurance as stated In this policy. If there Is a conflict between the Act, the regulations pubHshed at 7 CFR chapter
      IV, and the procedures as Issued by FCIC, the order of priority Is as follows: {1) the Act: (2) the regulations: and (3) the procedures as
      Issued by FCIC, with (1) controlling (2), etc. If there is a conflict between the policy provisions and the administrative regulations
      published at 7 CFR part 400, the policy provisions control. If a conflict exists among the policy provisions, the order of priority is: (1) the
      Catastrophic Risk Protection Endorsement, as applicable; (2) the Special Provisions: (3) the Crop Provisions; and (4} these Basic
      Provisions, with (1) controlling (2), etc.

                                                                  BASIC PROVISIONS
                                                                 Terms and Conditions

      1.    Definitions                                                                 at 100 percent of the Base Price, or a comparable
            Abandon - Failure to continue to care for the crop,                         coverage.
            providing care so Insignificant as to provide no benefit to                 Administrative fee • An amount you must pay for
           the crop, or failure to harvest In a timely manner, unless                   additional coverage for each crop year as specified in
           an Insured cause of loss prevents you from property caring                   section B.
           for or harvesting the crop or causes damage to It to the                     Agricultural commodity - Any crop or other commodity
           extent that most producers of the crop on acreage with                       produced, regardless of whether or not it is Insurable.
           similar characteristics In the area would not normally                       Agricultural experts - Persons who are employed by the
           further care for or harvest it                                               Cooperative State Research, Education and Extension
           Acreage report - A report required by section 7 of these                     Service or the agricultural departments of universities, or
           Basic Provisions that contains, In addition to other                        other persons approved by FCIC, whose research or
           required Information, your report of your share of an                       occupation is related to the specific crop or practice for
           acreage of an insured crop In the county, whether                           which such expertise is sought.
           Insurable or not Insurable.                                                 Annual crop • An agricultural commodity that normally
           Acreage reporting date - The date contained In the                          must be planted each year.
           Special Provisions or as provided In section 7 by which                     Application - The form required to be completed by you
           you are required to submit your acreage report.                             and accepted by us before insurance coverage will
           Act - The Federal Crop Insurance Act (7 U.S.C. 1501 et                      commence. This form must be completed and filed in your
           seq.).                                                                      agent's offiCe not later than the sales closing date of the
            Actual Production History (APH) - A process used to                        initial Insurance year for each crop for which Insurance
            determine production guarantees In accordance with 7                       coverage Is requested. If cancellation or termination of
            CFR part 400, subpart (G).                                                 insurance coverage occurs for any reason, Including but
            Actual Yield - The yield per acre for a crop year                          not limited to Indebtedness, suspension, debarment,
            calculated from the production records or claims for                      disqualification, cancellation by you or us, or violation of
            indemnities. The actual yield Is determined by dividing                   the controlled substance provisions of the Food Security
            total production (which Includes harvested and appraised                  Act of 1985, a new application must be ffled for the crop.
            production) by planted acres.                                             Insurance coverage will not be provided if you are
            Actuarial documents - The material for the crop year                      ineligible under the contract or under any Federal statute
            which Is available for public Inspection In your agent's                  or regulation.
            offiCe   and    published      on     RMA's     website    at             Approved yield - The actual production history (APH)
            htto:/fwww.rma.uscla.gov/ or a successor website, and                     yield, calculated and approved by the verifier, used to
           which shows available coverage levels, Information                         determine the Final Guarantee by summing the yearly
           needed to determine amounts of insurance, premium                          actual, assigned, adjusted or unadjusted transitional yields
           rates, premium adjustment percentages, practices,                          and dividing the sum by the number of yields contained in
           particular types or varieties of the Insurable crop, Insurable             the database, which will always contain at least four
           ~creage, and other related information regarding crop                      yields. The database may contain up to 10 consecutive
           Insurance In the county.                                                   crop years of actual or assigned yields. The approved
           Additional coverage - A level of coverage equal to or                      yield may have yield adjustments elected under section
           greater than 50 percent of the approved yield Indemnified                  35, revisions according to sectl~o~l.iiW·~~~~~~
                                                                                                                               PLAINTIFF'S
     C 2004 National Crop Insurance Services, Inc.                    Page 1 of26
                                                                                                                                 EXHIBIT
                                                                  EXHIBIT 4
                                                                                                                           I     25
                                                                                                                                       s
..          according to FCIC approved procedures applied when                      full text of the CFR is available in electronic fonnat a
            calculating the approved yield. This yield is established for          hHo:/fwww.access.Qoo.gov/ or a successor website.
            basic or optional units. The approved yield for each basic             Consent - Approval in writing by us allowing you to take f
            or optional unit comprising an enterprise unit Is retained             specific action.
      "     for premium and Anal Guarantee purposes under an                       Contract- (see •Polley".)
       1 enterprise unit                                                           Contract change date - The calendar date by whict
            Area - Land surrounding the insured acreage with                       changes to the policy, if any, wiU be made available lr
            geographic characteristics, topography, soil types and                 accordance with section 5 of these Basic Provisions.
            climatic conditions similar to the Insured acreage.                    Conventional farming practice - A system or process fo1
            Assignment of Indemnity - A transfer of policy rights,                 producing an agricultural commodity, excluding organic
           made on our form, and effective when approved by us. It                 farming practices, that Is necessary to produce the crop
            Is the arrangement whereby you assign your right to an                 that may be, but is not required to be, generally
           Indemnity payment to any party of your choice for the crop              recognized by agricultural experts for the area to conserve
           year.                                                                   or enhance natural resources and the environment.
           Average yield • The yield, calculated by summing the                    County - Any county, parish, or other political subdivision
           yearly actual, assigned, adjusted or unadjusted transitional           of a state shown on your accepted appUcatlon, Including
           yields and dividing the sum by the number of yields                    acreage In a field that extends Into an adjoining county If
           contained In the database, prior to any adjustments,                   the county boundary Is not readily discernible.
           Including those elected under section 35, revisions                    Coverage - The insurance provided by this policy, against
           according to section 4, or other limitations according to              insured loss of revenue by unit as shown on your
           FCIC approved procedures.                                              summary of coverage.
           Base premium rate - A premium rate used to calculate                   Cover crop - A crop generally recognized by agricultural
          the risk associated with yield.                                         experts as agronomically sound for the area for erosion
           Base Price - The Initial price determined in accordance                control or other purposes related to conservation or soil
           with the Commodity Exchange Endorsement and used to                    Improvement. A cover crop may be considered to be a
          calculate your premium and Minimum Guarantee.                           second crop (see the definition of •second crop•).
          Buffer zone - A parcel of land, as designated In your                   Coverage begins, date - The calendar date Insurance
          organic plan, that separates agricultural commodities                   begins on the Insured crop, as contained In the Crop
          grown under organic practices from agricultural                         Provisions, or the date planting begins on the unit (see
          commodities grown under non-organic practices, and used                 section 12 of these Basic Provisions for specific provisions
          to minimize the possibility of unintended contact by                    relating to prevented planting).
          prohibited substances or organisms.                                     Crop Provisions - The part of the policy that contains the
          CertJffed organic acreage - Acreage In the certified                    specific provisions of insurance for each Insured crop.
          organic farming operation that has been certified by a                  Crop year - The period within which the Insured crop Is
          certifying agent as conforming to organic standards in                  normally grown, regardless of whether or not It Is actually
          accordance with 7 CFR part 205.                                         grown, and designated by the calendar year In whlch the
          Certifying agent - A private or governmental entity                     Insured crop Is normally harvested, unless otherwise
          accredited by the USDA Secretary of Agriculture for the                specified In the Crop Provisions.
          purpose of certifying a production, processing or handling             Damage - InJury, deterioration, or loss of revenue of the
          operation as organic.                                                  Insured crop due to Insured or uninsured causes.
          CRC base rate- The premium rate used to calculate the                   Days - Calendar days.
          risk associated with revenue.                                          Deductible - The amount determined by subtracting the
         CRC high price factor· A premium factor, as set forth In                coverage level percentage you choose from 100 percent.
         the actuarial documents, used to calculate the risk                      For example, If you elected a 65 percent coverage level,
         associated with an Increase In the Harvest Price relative to                                                                =
                                                                                 your deductible would be 35 percent (1 00% - 65% 35%).
         the Base Price.                                                         Delinquent debt - Any administrative fees or premiums
         CRC low price factor - A premium factor, as set forth in                for insurance issued under the authority of the Act, and the
         the actuarial documents, used to calculate the risk                     Interest on those amounts, If applicable, that are not
         associated with a decrease In the Harvest Price relative to             postmarked or received by us or our agent on or before
         the Base Price.                                                         the termination date unless you have entered into an
         Calculated Revenue - The production to count for the                    agreement acceptable to us to pay such amounts or have
         insured crop multiplied by the Harvest Price.                           filed for bankruptcy on or before the termination date; any
         Cancellation date • The calendar date specified In the                  other amounts due us for Insurance issued under the
         Crop Provisions on which coverage for the crop will                     authority of the Act (Including, but not limited to,
         automatically renew unless canceled in writing by either                Indemnities, prevented planting payments or replanting
         you or us, or terminated In accordance with the policy                  payments found not to have been earned or that were
         terms.                                                                  overpaid), and the Interest on such amounts, If applicable,
         Claim for Indemnity - A claim made on our form by you                   which are not postmarked or received by us or our agent
         for damage or loss to an insured crop and submitted to us               by the due date specified In the notice to you of the
         not later than 60 days after the Harvest Price is released              amount due; or any amounts due under an agreement
         (see section 15).                                                       with you to pay the debt, which are not postmarked or
        Code of Federal Regulations (CFR) - The codification of                  received by us or our agent by the due dates specified In
        general and permanent rules published In the Federal                     such agreement.
        Register by the Executive departments and agencies of                    Disinterested third party - A person that does not have
        the Federal Government. Rules published In the Federal                   any familial relationship (parents, brothers, sisters,
      )                                                                          children, spouse, grandchildren, aunts, uncles, nieces,
        Register by FCIC are contained in 7 CFR chapter IV. The
                                                                                 nephews, first cousins, or grandparents, related by blood,

     C 2004 National Crop Insurance Services, Inc.                   Page2of26


                                                                EXHIBIT 4                                                 26
..           adoption or marriage, are considered to have a famHial                or contained In the organic plan. We may, or you rna~
             relationship) with you or who will not benefit financially            request us to, contact FCIC to determine whether or no
             from the sale of the Insured crop. Persons who are                    production methods will be considered to be "good farmln~
             authorized to conduct quality analysis In accordance with             practices.·
            the Crop Provisions are considered disinterested third                 Harvest Price - The final price determined In accordancE
            parties unless there Is a familial relationship.                       with the Commodity Exchange Endorsement and used t<
             Double crop - Producing two or more crops for harvest on              calculate your Calculated Revenue and the Harves
            the same acreage In the same crop year.                                Guarantee.
            Earliest planting date - The initial planting date contained           Household - A domestic establishment Including thE
            In the Special Provisions, which is the earliest date you              members of a family (parents, brothers, sisters, children
            may plant an Insured agricultural commodity and qualify               spouse, grandchildren, aunts, uncles, nieces, nephews
            for a replanting payment If such payments are authorized              first cousins, or grandparents, related by blood, adoptior
            by the Crop Provisions.                                               or marriage, are considered to be family members) anc
            End of Insurance period, date of - The date upon which                others who live under the same roof.
            your crop Insurance coverage ceases for the crop year                 Insurable loss - Damage for which coverage is providec
            (see Crop Provisions and section 12).                                 under the terms of your policy, and for which you accep
            FCIC - The Federal Crop Insurance Corporation, a wholly               an Indemnity payment.
            owned government corporation within USDA.                             Insured - The named person shown on the applicatlor
            Field - AU acreage of liftable land within a natural or               accepted by us. This term does not extend to any othe
            artificial boundary (e.g., roads, waterways, fences, etc.).           person having a share or interest In the crop (for example
            Different planting patterns or planting different crops do            a partnership, landlord, or any other person) unle~
            not create separate fields.                                           specifically indicated on the accepted application.
            Final Guarantee - The number of dollars guaranteed per                Insured crop - The crop in the county for which coverage
           acre determined to be the higher of the Minimum                        is available under your policy as shown on the applicatior
           Guarantee or the Harvest Guarantee, where:                             accepted by us.
           (1) Minimum Guarantee - The approved yield per acre                    lnterplanted - Acreage on which two or more crops are
                  multiplied by the Base Price multiplied by the                 planted In a manner that does not permit separate
                  coverage level percentage you elect.                           agronomic maintenance or harvest of the Insured crop.
           (2) Harvest Guarantee - The approved yield per acre                   Irrigated practice - A method of producing a crop b}
                  multiplied by the Harvest Price, multiplied by the             which water Is artificially applied during the growin~
                  coverage level percentage you elect.                           season by appropriate systems and at the proper times
           If you elect enterprise unit coverage, the basic units or             with the Intention of providing the quantity of water needec
           optional units comprising the enteJprise unit will retain             to produce at least the yield used to establish the Rna
           separate Anal Guarantees.                                             Guarantee on the irrigated acreage planted to the lnsurec
           Final planting date - The date contained in the Special               crop.
           Provisions for the Insured crop by which the crop must                Late planted - Acreage initially planted to the insured CI'OJ=
           Initially be planted in order to be Insured for the full Anal         after the final planting date.
           Guarantee.                                                            Late planting period - The period that begins the da~
           First Insured crop -With respect to a single crop year and            after the final planting date for the insured crop and ends
           any speclfic crop acreage, the first Instance that an                 25 days after the final planting date, unless otherwise
          agricultural commodity Is planted for harvest or prevented             specified in the Crop Provisions or Special Provisions.
          from being planted and is insured under the authority of               Liability - The dollar amount of insurance coverage use<J
          the Act. For example, if winter wheat that Is not insured is           In the premium computation for the insured agricultura
          planted on acreage that Is later planted to soybeans that             commodity.
          are Insured, the first insured crop would be soybeans. If              Limited resource fanner - A person with:
          the winter wheat was insured, it would be the first insured           (1) Direct or indirect gross farm sales not more than
          crop.                                                                        $100,000.00 in each of the previous two years (to be
          FSA- The Farm Service Agency, an agency of the USDA,                         increased starting in fiscal year 2004 to adjust for
         or a successor agency.                                                        inflation using Prices Paid by Farmer Index as
          FSA farm aerial number - The number assigned to the                          complied by National Agricultural Statistical Service
          farm by the local FSA office.                                                (NASS)); and
         Generally recognized - When agricultural experts or the                (2) A total household income at or below the national
         organic agricultural industry, as applicable, are aware of                    poverty level for a family of four, or less than 50
         the production method or practice and there Is no genuine                     percent of county median household income in each
         dispute regarding whether the production method or                            of the previous two years (to be determined annuaUy
         practice allows the crop to make normal progress toward                       using Commerce Department Data).
         maturity and produce at least the yield used to determine              MPCI - Multiple peril crop insurance program, a program
         the Anal Guarantee.                                                    of Insurance offered under the Act and Implemented in 7
         Good fanning practices - The production methods                        CFR chapter IV.
         utilized to produce the insured crop and allow It to make              Negligence - The failure to use such care as a reasonably
         normal progress toward maturity and produce at least the               prudent and careful person would use under similar
         yield used to determine the Anal Guarantee, Including any              circumstances.
         adjustments for late planted acreage, which are: (1) for               Non-contiguous - Acreage of an Insured crop that is
         conventional or sustainable farming practices, those                   separated from other acreage of the same insured crop by
         generally recognized by agricultural experts for the area;             land that is neither owned by you nor rented by you for
         or (2) for organic farming practices, those generally                  cash or a crop share. However, acreage separated by only
         recognized by the organic agricultural industry for the area

     0 2004 National Crop Insurance Services, Inc.                  Page3of26                                                               c

                                                              EXHIBIT 4                                                   27
..         a public or private right-of-way, waterway, or an irrigation           crop due to an insured cause of loss that Is general in the
           canal will be considered as contiguous.                                surrounding area and that prevents other producers from
           Offset - The act of deducting one amount from another                  planting acreage with similar characteristics.
           amount.                                                                Production report • A written record showing your annual
           Organic agricultural Industry • Persons who are                       production and used by us to determine your yield for
           employed by the following organizations: Appropriate                  insurance purposes (see section 4). The report contains
           Technology Transfer for Rural Areas, Sustainable                       yield information for previous years, including planted
           Agriculture Research and Education or the Cooperative                  acreage and harvested production. This report must be
           State Research, Education and Extension SeiVice, the                   supported by written verifiable records from a
           agricultural departments of universities, or other persons             warehouseman or buyer of the Insured crop, by
           approved by FCIC, whose research or occupation Is                     measurement of farm-stored production, or by other
          related to the specific organic crop or practice for which             records of production approved by us on an Individual
          such expertise Is sought.                                              case basis.
          Organic farming practice • A system of plant production                Prohibited substance • Any biological, chemical, or other
          practices approved by a certifying agent In accordance                 agent that is prohibited from use or Is not Included In the
          with 7 CFR part 205.                                                   organic standards for use on any certified organic,
          Organic plan - A written plan, In accordance with the                  transitional or buffer zone acreage. Usts of such
          National Organic Program published In 7 CFA part 205,                  substances are contained at 7 CFR part 205.
          that describes the organic farming practices that you and a            Replanted crop - The same agricultural commodity
          certifying agent agree upon annually or at such other                  replanted on the same acreage as the first insured crop for
          times as prescribed by the certifying agent.                           harvest In the same crop year If the replanting is
          Organic standards - Standards in accordance with the                   specifically made optional by the policy and you elect to
          Organic Foods Production Act of 1990 (7 U.S.C. 6501 et                 replant the crop and Insure it under the policy covering the
          seq.) and 7 CFR part 205.                                              first Insured crop, or replanting is required by the policy.
          Perennial crop- A plant. bush, tree, or vine crop that has            Replanting - Performing the cultural practices necessary
          a life span of more than one year.                                    to prepare the land to replace the seed or plants of the
          Person • An Individual, partnership, association,                      damaged or destroyed Insured crop and then replacing the
          corporation, estate, trust, or other legal entity, and                seed or plants of the same crop In the same insured
          wherever applicable, a State or a political subdivision or             acreage. The same crop does not necessarily mean the
          agency of a State. MPerson• does not Include the United                same type or variety of the crop unless different types or
          States Government or any agency thereof.                              varieties constitute separate crops or it Is otherwise
          Planted acreage - land In which seed, plants, or trees                specified in the policy.
          have been placed appropriate for the Insured crop and                 Representative sample • Portions of the insured crop that
         planting method, at the correct depth, into a seedbed that             must remain in the field for examination and review by our
         has been properly prepared for the planting method and                 loss adjuster when making a crop appraisal, as specified
         production practice.                                                   in the Crop Provisions. In certain instances we may allow
         Polley - The agreement between you and us to Insure an                 you to harvest the crop and require only that samples of
         agricultural commodity and consisting of the accepted                  the crop residue be left in the field.
         application, these Basic Provisions, the Crop Provisions,              Sales closing date - A date contained In the Special
         the Special Provisions, other applicable endorsements or               Provisions by which an application must be filed. The last
         options, the actuarial documents for the Insured                       date by which you may change your crop insurance
         agricultural commodity, and the applicable regulations                 coverage for a crop year.
         published in 7 CFA chapter IV. Insurance for each                      Second crop -With respect to a single crop year, the next
         agricultural commodity in each county wiD constitute a                 occurrence of planting any agricultural commodity for
         separate policy.                                                       harvest following a first insured crop on the same acreage.
         Practical to replant • Our detennination, after loss or                The second crop may be the same or a different
         damage to the Insured crop, based on ali factors,                      agricultural commodity as the first Insured crop, except the
         including, but not limited to moisture availability, marketing         term does not Include a replanted crop. A cover crop,
         window, condftion of the field, and time to crop maturity,            planted after a first insured crop and planted for the
        that replanting the insured crop will allow the crop to attain         purpose of haying, grazing or otherwise harvesting In any
         maturity prior to the calendar date for the end of the                manner or that Is hayed or grazed during the crop year, or
        Insurance period. It will be considered to be practical to             that Is otherwise harvested is considered to be a second
        replant regardless of availability of seed or plants, or the           crop. A cover crop that is covered by FSA's noninsured
        input costs necessary to produce the insured crop such as              crop disaster assistance program (NAP) or receives other
        those that would be Incurred for seed or plants, Irrigation            USDA benefits associated with forage crops will be
        water, etc.                                                            considered as planted for the purpose of haying, grazing,
        Premium billing date • The earliest date upon which you                or otherwise harvesting. A crop meeting the concfltions
        will be billed for insurance coverage based on your                    stated herein will be considered to be a second crop
        acreage report. The premium billing date Is contained In               regardless of whether or not It Is Insured. Notwithstanding
        the Special Provisions.                                                the references to haying and grazing as harvesting In
        Prevented planting • Failure to plant the insured crop                 these Basic Provisions, for the purpose of determining the
        with proper equipment by the final planting date                       end of the insurance period, harvest of the crop will be as
        designated in the Special Provisions for the Insured crop              defined in the applicable Crop Provisions.
        in the county. You may also be eligible for a prevented                Section (for the purposes of unit structure) - A unit of
        planting payment if you failed to plant the insured crop               measure under a rectangular survey system describing a
      • with the proper equipment within the late planting period.             tract of land usually one mtle square and usually
        You must have been prevented from planting the insured                 containing approximately 640 acres.


     C 2004 National Crop Insurance Services, Inc.                 Page4of26


                                                              EXHIBIT 4                                                  28
...       ..
               Share- Your percentage of Interest in the Insured crop as             Void - When the policy Is considered not to have existet
               an owner, operator, or tenant at the time insurance                   for a crop year as a result of concealment, fraud, o
               attaches. However, only for the purpose of determining the            misrepresentation (see section 27).
               amount of Indemnity, your share will not exceed your                  Written Agreement - A document that alters designate1
               share at the earlier of the time of loss, or the beginning of         terms of a policy as authorized under these Bash
               harvest.                                                              Provisions (see section 34).
               Special Provisions - The part of the policy that contains         2. Unit Structure
               specific provisions of insurance for each insured crop that           (a) Basic unit - All Insurable acreage of the Insured cro1
               may vary by geographic area.                                               In the county on the date coverage begins for the cro1
               State - The state shown on your accepted application.                      year:
               Substantial beneficial Interest - An Interest held by any                 (1) In which you have 1 00 percent crop share; or
              person of at least 10 percent in you. The spouse of any                    (2) Which Is owned by one person and operated b~
              Individual applicant or individual Insured will be considered                     another person on a share basis. (Example: If, ir
              to have a substantial beneficial Interest in the applicant or                     addition to the land you own, you rent land fron
              Insured unless the spouses can prove they are legally                             five landlords, three on a crop share basis am
              separated or otheJWise legally separate under state law.                          two on a cash basis, you would be entitled to fou
              Any child of an Individual applicant or Individual insured                        units; one for each crop share lease and one tha
              will not be considered to have a substantial beneficial                           combines the two cash leases and the land yot
             Interest In the applicant or Insured unless the child has a                        own.) Land rented for cash, a fixed commodil)
              separate legal interest In such person. For example, there                       payment, or a consideration other than a share lr
              are two partnerships that each have a 50 percent Interest                         the Insured crop, or proceeds from the sale of thE
              in you and each partnership is made up of two Individuals,                       Insured crop, on such land will be considered a!
             each with a 50 percent share in the partnership. In this                           owned by the lessee (see definition of •share'
             case, each Individual would be considered to have a 25                             above).
             percent interest in you, and both the partnerships and the             (b) Optional unit- Unless limited by the Crop Provisiom
             Individuals would have a substantial beneficial Interest In                 or Special Provisions, a basic unit as defined ir
             you (The spouses of the Individuals would not be                            section 2(a) may be divided into optional units if, fo1
             considered to have a substantial beneficial Interest unless                 each optional unit:
             the spouse was one of the individuals that made up the                      (1) You meet the following:
             partnership). However, If each partnership Is made up of                          (i) You have records, that are acceptable to us
             six Individuals with equal Interests, then each would only                                for at least the previous crop year for al
             have an 8.33 percent Interest in you and although the                                     optional units that you will report In the
            partnership would still have a substantial beneficial                                     current crop year (You may be required tc
            Interest In you, the individuals would not for the purposes                               produce the records for all optional units for
            of reporting In section 3.                                                                the previous crop year);
            Summary of coverage - Our statement to you, based                                  (ii) You must plant the crop In a manner that
            upon your acreage report, specifying the Insured crop and                                 results In a clear and dlscemable break In
            the Final Guarantee provided by unit.                                                     the planting pattern at the boundaries ol
            Sustainable farming practice - A system or process for                                    each optional unit;
            producing an agricultural commodity, excluding organic                             (Iii) All optional units you select for the crop year
            farming practices, that is necessary to produce the crop                                  are Identified on the acreage report for that
           and is generally recognized by agricultural experts for the                                crop year (Units will be determined when the
           area to conserve or enhance natural resources and the                                      acreage Is reported but may be adjusted or
           environment.                                                                               combined to reftect the actual unit structure
           Tenant - A person who rents land from another person for                                   when adjusting a loss. No further unit
           a share of the crop or a share of the proceeds of the crop                                 division may be made after the acreage
           (see the definition of "shareR above).                                                     reporting date for any reason); and
           Termination date - The calendar dale contained In the                              (iv) You have records of marketed or stored
           Crop Provisions upon which your insurance ceases to be                                     production from        each optional unit
           in effect because of nonpayment of any amount due us                                       maintained In such a manner that permits us
           under the policy, Including premium.                                                      to verify the production from each optional
          Timely planted - Planted on or before the final planting                                   unit, or the production from each optional
          date designated In the Special Provisions for the insured                                  unit Is kept separate until loss adjustment is
          crop In the county.                                                                        completed by us.
          Transitional acreage - Acreage on which organic farming                       (2) It meets one or more of the following, unless
          practices are being followed that does not yet qualify to be                        otherwise specified In the Crop Provisions or
          designated as organic acreage.                                                      allowed by written agreement (Note: No written
          Unlt-                                                                               agreement Is allowed for optional units created
          (a) Basic unH - A unit established In accordance with                               across section lines or In oversized sections if the
                  section 2(a).                                                               acreage Is located In a high risk area):
          (b) Optional unit • A unit established from basic units in                          (i) Optional units may be established if each
                  accordance with section 2(b).                                                      optional unit is located in a separate section.
          (c) Enterprise unit - A unit established from basic units                                  In the absence of sections, we may consider
                  or optional units In accordance with section 2(c).                                 parcels of land legally Identified by other
          USDA - United States Department of Agriculture.                                           methods of measure such as Spanish
                                                                                                     grants, as the equivalents of sections for unit
                                                                                                    purposes. In areas which have not been

      ~ 2004 National   Crop Insurance Services, Inc.                  Page 5 of26


                                                                  EXHIBIT 4                                                   29
                         surveyed using sections, section equivalents                           are located in two or more separate sections,
                         or In areas where boundaries are not readily                           section equivalents, FSA farm serial
                         discernible, each optional unit must be                                numbers, or unlts established by written
                         located In a separate FSA farm serial                                  agreement, with at least some planted
                         number;                                                                acreage In two or more separate sections,
                  (li) In addition to, or Instead of, establishing                             section equivalents, FSA farm serial
                        optional units by section, section equivalent                          numbers, or two or more separate units as
                        or FSA farm serial number, optional units                              established by written agreement; or
                        may be based on Irrigated and non-Irrigated                       (II) For two or more optional units of the same
                        acreage. To qualify as separate Irrigated and                          insured crop established by separate
                        non-irrigated optional units, the non-irrigated                        sections, section equivalents, FSA farm
                        acreage may not continue into the Irrigated                            serial numbers, or as established by wriUen
                        acreage in the same rows or planting                                   agreement, with at least two optional units
                        paUem. The irrigated acreage may not                                   containing some planted acreage, as defined
                        extend beyond the point at which the                                   In section 2(b)(2)(1).
                        Irrigation system can deliver the quantity of                (3) These basic units or optional units that comprise
                        water needed to produce the yield on which                        the enterprise unit must each have Insurable
                        the Anal Guarantee is based, except the                           planted acreage of the same crop In the crop
                        comers of a field In which a center-pivot                         year Insured;
                       Irrigation system Is used may be considered                   (4) You must comply with all reporting requirements
                        as Irrigated acreage If the corners of a field                    for the enterprise unit (You must maintain
                       In which a center-pivot Irrigation system is                       required production records on a basic or
                        used do not qualify as a separate non-                           optional unit basis If you wish to change your unit
                       Irrigated optional unit. In this case,                            structure for any subsequent crop year);
                       production from both practices will be used                   (5) The qualifying basic units or optional units may
                       to determine your approved yield; and                             not be combined Into an enterprise unit on any
                 (Iii) In addition to, or instead of, establishing                       basis other than as described herein; and
                       optional units by section, section equivalent                 (6) At any time we discover you do not comply with
                       or FSA farm serial number, or Irrigated and                       the reporting provisions for the enterprise unit,
                       non-Irrigated acreage, separate optional                          your yield for the enterprise unit will be
                       units may be established for acreage of the                       determined In accordance with section 4.
                       Insured crop grown and Insured under an                  (d) Selection of unit structure- Basic or optional units will
                       organic farming practice. Certified organic,                 be determined when the acreage Is reported but may
                       transitional and buffer zone acreages do not                 be adjusted, combined, or separated to reflect the
                       Individually qualify as separate units. (See                 actual unit structure when adjusting a loss. If you
 )                     section 37 for additional provisions regarding               select an enterprise unit structure, you must make
                       acreage Insured under an organic farming                     such election by the sales closing date for the Insured
                       practice).                                                   crops and report such unit structure to us in writing.
          (3) If you do not comply fully with the provisions In                     Your enterprise unit structure selection will remain In
                this section, we will combine all optional units that               effect from year to year unless you notify us in writing
                are not in compliance with these provisions Into                    by the sales closing date for the crop and year for
                the basic unit from which they were formed. We                      which you wish to change this election. Eligibility for
                will combine the optional units at any time we                      enterprise units will be determined when the acreage
                discover that you have failed to comply with                        Is reported. At any time we discover you do not qualify
                these provisions. If failure to comply with these                   for an enterprise unit, we wm assign the basic unit
                provisions is determined by us to be Inadvertent,                   structure.
                and the optional units are combined Into a basic                All applicable unit structures must be stated on the
                unit, that portion of the additional premium paid               acreage report for each crop year.
                for the optional units that have been combined             3.   Life of Polley, Cancellation, and Tennlnatfon
               wUI be refunded to you for the units combined.                   (a) This Is a continuous poUcy and wiH remain in effect for
     (c) Enterprise unit - A unit that consists of aU insurable                     each crop year foRowlng the acceptance of the
         planted acreage of the insured crop In the county In                       original application until canceled by you In
         which you have a share on the date coverage begins                         accordance with the terms of the policy or terminated
         for the crop year. If you select and qualify for an                        by operation of the terms of the policy, or by us.
         enterprise unit, you will qualify for a premium discount               (b) Your application for Insurance must contain your
         based on the Insured crop and number of acres In the                       social security number (SSN) If you are an Individual
         enterprise unit. The discount contained In the                             or employer Identification number (EIN) if you are a
         actuarial documents will only apply to acreage In the                      person other than an Individual, and all SSNs and
         enterprise unit that has been planted. The following                       EINs, as applicable, of all persons with a substantial
         requirements must be met to qualify for an enterprise                      beneficial interest In you, the coverage level, crop,
         unit:                                                                      type, variety, or class, plan of Insurance, and any
         ( 1) The enterprise unit must contain 50 or more                           other material information required on the application
               acres;                                                               to Insure the crop. If you or someone with a
         (2) The acreage that comprises the enterprise unit                         substantial beneficlallnterest Is not legally required to
               must also qualify:                                                   have a SSN or EIN, you must request and receive an
 )             (I) For two or more basic units of the same                          Identification number for the purposes of this policy
                      insured crop as defined in section 2(a) that                  from us or the lntemal Revenue Service (IRS) if such

C 2004 National Crop Insurance Services, Inc.                      Page& of26


                                                              EXHIBIT 4                                                   30
              Identification number is available from the IRS. If any                 planting payment due you for this or any other cro1=
              of the information regarding persons with a                             insured with us under the authority of the Act.
              substantial beneficial interest changes during the crop                 (1) Even if your claim has not yet been paid, you
              year, you must revise your application by the next                            must stili pay the premium and administrative fee
   '          sales closing date applicable under your policy to                           on or before the termination date for you tc
     I        reflect the correct information.                                              remain eligible for Insurance.
              (1) Applications that do not contain your SSN, EIN or                   (2) If we offset any amount due us from an indemnity
                    Identification number, or any of the other                             or prevented planting payment owed to you, the
                    Information required in section 3(b) are not                           date of payment for the purpose of determining
                    acceptable and Insurance will not be provided                           whether you have a delinquent debt will be the
                    (Except If you fall to report the SSNs, EINs or                        date that you submit the claim for Indemnity in
                    Identification numbers of persons with a                               accordance with section 15(c) (Your Duties).
                    substantial beneficial interest in you, the                 (f) A delinquent debt for any policy will make you
                    provisions in section 3(b)(2) will apply);                       ineligible to obtain crop insurance authorized under
             (2) If the application does not contain the SSNs,                       the Act for any subsequent crop year and result In
                    EINs, or Identification numbers of all persons with              termination of all policies in accordance with section
                    a substantial beneficial interest in you, you fall to            3(f)(2).
                    revise your application in accordance with section               (1) With respect to ineligibility:
                   3(b), or the reported SSNs, EINs, or identification                     (I) Ineligibility for crop Insurance will be effective
                   numbers are incorrect and the incorrect SSN,                                  on:
                   EIN, or identification number has not been                                    (A) The date that a policy was terminated in
                    corrected by the acreage reporting date, and:                                     accordance with section 3(f)(2) for the
                   (I) Such persons are eligible for insurance, the                                   crop for which you failed to pay
                         amount of coverage for all crops included on                                 premium, an administrative fee, or any
                         this    application     will    be    reduced                                related interest owed, as applicable;
                         proportionately by the percentage interest in                           (B) The payment due date contained in any
                         you of such persons, you must repay the                                      notification of indebtedness for any
                         amount of indemnity, prevented planting                                      overpaid indemnity, prevented planting
                         payment or replanting payment that is                                        payment or replanting payment, if you
                         proportionate to the interest of the persons                                 fall to pay the amount owed, including
                        whose SSN, EIN, or identification number                                      any related interest owed, as applicable,
                        was unreported or incorrect for such crops,                                   by such due date;
                        and your premium will be reduced                                        (C) The termination date for the crop year
                        commensurately; or                                                            prior to the crop year in which a
                   (ii) Such persons are not eligible for insurance,                                  scheduled payment is due under a
                        except as provided in section 3(b)(3), the                                    payment agreement if you fail to pay the
                        policy is void and no indemnity, prevented                                    amount owed by any payment date in
                        planting payment or replanting payment will                                   any agreement to pay the debt; or
                        be owed for any crop included on this                                   (D) The termination date the policy was or
                        application, and you must repay any                                           would have been terminated under
                        indemnity, prevented planting payment or                                      sections 3(f)(2)(i)(A), (B), or (C) if your
                        replanting payment that may have been paid                                    bankruptcy petition is dismissed before
                        for such crops. If previously paid, the                                       discharge.
                        balance of any premium and any                                    (ii) If you are ineligible and a policy has been
                        administrative fees will be returned to you,                            terminated In accordance with section
                        less twenty percent of the premium that                                 3(f)(2), you will not receive any Indemnity,
                        would otherwise be due from you for such                                prevented planting payment or replanting
                        crops. If not previously paid, no premium or                            payment, if applicable, and such ineligibility
                        administrative fees will be due for such                                and termination of the policy may affect your
                        crops.                                                                 eligibility for benefits under other USDA
            (3) The consequences described in section 3(b)(2)(ii)                              programs. Any Indemnity, prevented planting
                  will not apply If you have included an ineligible                            payment or replanting payment that may be
                  person's SSN, EIN, or identification number on                               owed for the policy before it has been
                  your application and do not include the ineligible                           terminated will remain owed to you, but may
                 person's share on the acreage report.                                         be offset in accordance with section 3(e),
       (c) After acceptance of the application, you may not                                    unless your policy was terminated in
           cancel this policy for the initial crop year. Thereafter,                           accordance with sections 3(f)(2)(i)(D) or (E).
           the policy will continue in force for each succeeding                    (2) With respect to termination:
           crop year unless canceled or terminated as provided                           (I) Termination will be effective on:
           below.                                                                              (A) For a policy with unpaid administrative
       (d) Either you or we may cancel this policy after the initial                                 fees or premiums, the termination date
           crop year by providing written notice to the other on or                                  immediately subsequent to the billing
           before the cancellation date shown in the Crop                                            date for the crop year;
           Provisions.                                                                         (B) For a policy with other amounts due, the
  I (e) Any amount due to us for any policy authorized under                                         termination date immediately following
           the Act will be offset from any indemnity or prevented                                    the date you have a delinquent debt;



C 2004 National Crop Insurance Services, Inc.                       Page7of26


                                                               EXHIBIT 4                                                   31
..        ..                 (C) For each policy for which insurance has                           closing date. If you fail to make a payment that
                                  attached before you become Ineligible,                          was scheduled to be made on April 1, 2005, your
                                  the termination date immediately                                policy will tennlnate as of October 31, 2004, for
                                  following the date you become ineftgible;                       crop A, and March 15, 2005, for crop 8, and no
                             (D) For execution of an agreement to pay                             Indemnity, prevented planting payment or
                                  any amounts owed and failure to make                            replanting payment will be due for that crop year
                                  any scheduled payment, the termination                          for either crop. You will not be eligible to apply for
                                 date for the crop year prior to the crop                         crop Insurance for any crop until after the
                                  year In which you failed to make the                            amounts owed are paid In full or you file a petition
                                 scheduled payment; or                                            to discharge the debt In bankruptcy.
                            (E) For dismissal of a bankruptcy petition                       (6) If you are determined to be ineligible under
                                 before discharge, the termination date                           section 3(f), persons with a substantial beneficial
                                 the policy was or would have been                                Interest In you may also be Ineligible until you
                                 terminated under sections 3{f)(2XI)(A),                          become eligible again.
                                 (B) or(C).                                          (g)     If you die, disappear, or are judicially declared
                      (il) For all policies terminated under sections                        Incompetent, or If you are an entity other than an
                            3(f)(2)(i)(D) and (E), any indemnities,                          individual and such entity Is dissolved, the policy will
                            prevented planting payments or replanting                        tennlnate as of the date of death, judicial declaration,
                            payments paid subsequent to the termination                      or dissolution. If such event occurs after coverage
                            date must be repaid.                                             begins for any crop year, the policy will continue In
                     (iii) Once the policy Is terminated, It cannot be                       force through the crop year and terminate at the end
                            reinstated for the current crop year unless                      of the insurance period and any Indemnity will be paid
                            the termination was in error. Failure to timely                 to the person or persons determined to be beneficially
                            pay because of illness, bad weather, or other                   entitled to the Indemnity. The premium will be
                            such extenuating circumstances Is not                           deducted from the indemnity or collected from the
                           grounds for reinstatement in the current                         estate. Death of a partner In a partnership will
                           year.                                                            dissolve the partnership unless the partnership
                (3) To regain eligibility, you must:                                        agreement provides otherwise. If two or more persons
                     (i) Repay the delinquent debt in full;                                 having a joint Interest are insured jointly, death of one
                     (ii) Execute an agreement to pay any amounts                           of the persons will dissolve the joint entity.
                           owed and make payments in accordance                      (h)    We may cancel your policy if no premium is earned
                           with the agreement (We will not enter Into an                    for 3 consecutive years.
                           agreement with you to pay the amounts                     (I)    The cancellation and termination dates are contained
                           owed if you have previously failed to make a                     In the Crop Provisions.
                           scheduled payment under the terms of any                  0)     When obtaining coverage, you must provide
      )                    other agreement to pay with us or any other                      information regarding crop Insurance coverage on any
                           Insurance provider); or                                          crop previously obtained from an approved insurance
                    (iii) File a petition to have your debts discharged                     provider, Including the date such insurance was
                           in bankruptcy (Dismissal of the bankruptcy                       obtained and the amount of the administrative fee.
                           petition before discharge will terminate all              (k)   Any person may sign any document relative to crop
                           policies In effect retroactive to the date your                  insurance coverage on behalf of any other person
                           policy would have been terminated In                             covered by such a policy, provided that the person
                           accordance with section 3(f)(2)(i));                             has a properly executed power of attorney or such
               (4) After you become eligible for crop Insurance, If                        other legaHy sufficient document authorizing such a
                    you want to obtain coverage for your crops, you                        person to sign. You are still responsible for the
                    must submit a new application on or before the                         accuracy of all information provided on your behalf
                    sales closing date for the crop (Since applications                    and may be subject to the consequences In section
                    for crop insurance cannot be accepted after the                        7(g), and any applicable consequences, if any
                    sales closing date, if you make any payment after                      information has been misreported.
                    the sales closing date, you cannot apply for                     (I)   You are not eligible to participate In the Crop
                    insurance until the next crop year);                                   Revenue Coverage program If you have elected the
               (5) For example, for the 2003 crop year, if crop A,                          MPCI Catastrophic Risk Protection Endorsement
                    with a termination date of October 31, 2003, and                       except if you execute a High Risk Land Exclusion
                    crop 8, with a termination date of March 15,                           Option for a Crop Revenue Coverage Policy, you may
                    2004, are Insured and you do not pay the                               elect to insure the "high risk lancr under an MPCI
                    premium for crop A by the termination date, you                        Catastrophic Risk Protection Endorsement, provided
                    are ineligible for crop Insurance as of October 31,                    the Catastrophic Risk Protection Endorsement Is
                    2003, and crop A's policy is terminated as of that                     obtained from us. If both policies are in force, the
                    date. Crop B's policy does not terminate until                         acreage of the crop covered under the Crop Revenue
                    March 15, 2004, and an Indemnity for the 2003                          Coverage policy and the acreage covered under an
                    crop year may still be owed. If you enter an                           MPCI Catastrophic Risk Protection Endorsement will
                    agreement to repay amounts owed on                                     be considered as separate crops for Insurance
                    September 25, 2004, the earliest date by which                         purposes, Including the payment of administrative
                    you can obtain crop insurance for crop A Is to                         fees.
                    apply for crop insurance by the October 31, 2004,
      )             sales closing date and for crop 8 Is to apply for
                   crop insurance by the March 1S, 2005, sales

     0 2004 National Crop Insurance Services, Inc.                     Page 8 of26


                                                                  EXHIBIT 4                                                       32
    4.    Coverage Level, and Approved Yield For Detennlnlng                                        because the incorrect information was It
           Final Guarantee and Indemnity                                                            result of our error or the error of someor
           (a) Unless adjusted or fimited in accordance with your                                   from USDA.
                 policy, the Anal Guarantee, coverage level, and                   (f) In addition to any consequences in section 4(e),
                 approved yields at which an Indemnity will be                           any time the circumstances described below a
    )            determined for each unit will be those used to                          discovered, your approved yield will be adjusted:
                 calculate your summary of coverage for each crop                        (1) By including an assigned yield determined
                 year.                                                                        accordance with section 4(d)(1) and 7 CFR pe
           (b) You may select only one coverage level from among                              400, subpart G, If the actual yield reported In tt
                 those offered by us for all acreage of the crop In the                       database is excessive for any crop year, ~
                 county. You may change the coverage level for the                            determined by FCIC under its procedures, ar
                 following crop year by giving written notice to us not                       you do not provide verifiable records to suppc
                 later than the sales closing date for the Insured crop.                      the yield In the database (If there are verifiab
                 If you do not change the coverage level for the                              records for the yield In your database, the yield
                succeeding crop year you will be assigned the same                            significantly different from the other yields in tt
                coverage level that was in effect the previous crop                           county or your other yields for the crop and yc
                year.                                                                         cannot prove there Is a valid basis to support th
          (c) This policy Is an alternative to the MPCI program and                           differences In the yields, the yield win be th
                satisfies the requirements of section 508 (b)(7) of the                       average of the yields for the crop or th
                Act.                                                                          applicable county transitional yield if you have n
          (d) You must report production to us for the previous crop                          other yields for the crop, and you may be subjec
                year by the earlier of the acreage reporting date or 45                      to provisions of section 27);
                days after the cancellation date unless otherwise                       (2) By reducing It to an amount consistent with th
                stated in the Special Provisions.                                            average of the approved yields for othE
                (1) If you do not provide the required production                            databases for your farming operation with th
                       report, we will assign a yield for the previous crop                  same crop, type, and practice or the count
                       year. The yield assigned by us will not be more                       transitional yield, as applicable, if:
                       than 75 percent of the yield used by us to                            (i) The approved APH yield is greater than 11
                       determine your coverage for the previous crop                               percent of the average of the approve
                       year. The production report or assigned yield will                          yields of all applicable databases for yot
                       be used to compute your Approved Yield for the                              farming operation that have actual yields i
                       purpose of determining your Final Guarantee for                             them or it Is greater than 115 percent of ttl-
                       the current crop year.                                                      county transitional yield if no applicabl
               (2) If you have filed a claim for any crop year, the                                databases exist for comparison; and
 )                     documents signed by you which state the amount                        (II) The current year's Insured acreagt
                      of production used to complete the claim for                                 (Including applicable prevented plantin!
                      Indemnity wUI be the production report for that                              acreage) is greater than 400 percent of th1
                      year unless otherwise specified by FCIC.                                     average number of acres in the database o
               (3) Production and acreage for the prior crop year                                  the acres contained in two or more ind'IVldua
                      must be reported for each proposed optional unit                             years In the database are each less than 11
                      by the production reporting date. If you do not                              percent of the current year's insurabl•
                      provide the information stated above, the optional                           acreage In the unit (Including applicabh
                      units will be combined Into the basic unit.                                  prevented planting acreage); or
               (4) Appraisals obtained from only a portion of the                      (3) To an amount consistent with the productior
                      acreage in the field that remains unharvested                          methods actually carried out for the crop year I
                      after the remainder of the crop within a field has                    you use a different production method than wa!
                      been destroyed or put to another use will not be                       previously used and the production metho(
                      used to establish your actual yield unless                            actually carried out Is likely to result in a yielt
                      representative samples are required to be left by                     lower than the average of your previous actua
                      you In accordance with the Crop Provisions.                           yields. The yield will be adjusted based on you
         (e) It Is your responsibility to accurately report all                             other units where such production methods werE
              Information that is used to determine your approved                           carried out or to the applicable county transitions
              yield. You must certify to the accuracy of this                               yield for the production methods if other suet
              information on your production report.                                        units do not exist. You must notify us of change!
              (1) If you do not have written verifiable records to                          in your production methods by the acteagE
                     support the Information on your production report,                     reporting date. If you fall to notify us, in additlor
                     you will receive an assigned yield in accordance                       to the reduction of your approved yield describec
                     with section 4(d)(1) and 7 CFR part 400, subpart                       herein, you will be considered to have
                     G for those crop years for which you do not have                       misreported information and you will be subject tc
                     such records:                                                          the consequences in section 7(g). For example
              (2) If you misreport any material Information used to                         for a non-Irrigated unit, your yield Is based upon
                     determine your approved yield:                                         acreage of the crop that is watered once prior tc
                     (i) We will correct the unit structure, if                             planting, and the crop Is not watered prior tc
                           necessary; and                                                   planting for the current crop year. Your approved
)                    (il) You will be subject to the provisions                             APH yield will be reduced to an amounl
                          regarding mlsreporting contained in section                       consistent with the actual production history of
                          7(g), unless we correct the information                           your other non-Irrigated units where the crop has

C 2004 National Crop Insurance Services, Inc.                         Page9 of26


                                                                EXHIBIT 4                                                  33
      ...           not been watered prior to planting or limited to                        before August 15, you must submit an acreage
                    the non-Irrigated transitional yield for the unit if                    report for all such crops on or before the latest
                    other such units do not exist.                                         applicable acreage reporting date for such crops.
         (g) Unless you meet the double cropping requirements                         (3) Notwithstanding the provisions in sections 7(a){1)
              contained In section 18{f){4), if you elect to plant a                       and (2):
 )            second crop on acreage where the first insured crop                          (I) If the Special Provisions designate separate
              was prevented from being planted, you will receive a                              planting periods for a crop, you must submit
              yield equal to 60 percent of the approved yield for the                           an acreage report for each planting period
              first insured crop to calculate your average yield for                            on or before the acreage reporting date
              subsequent crop years {Not applicable to crops If the                             contained In the Special Provisions for the
              APH is not the basis for the Insurance guarantee). If                             planting period; and
              the unit contains both prevented planting and planted                        (II) If planting of the Insured crop continues after
             acreage of the same crop, the yield for the unit will be                           the final planting date or you are prevented
             determined by:                                                                     from planting during the late planting period,
             (1) Multiplying the number of Insured prevented                                    the acreage reporting date wtn be the later
                    planting acres by 60 percent of the approved                                of:
                    yield for the first Insured crop;                                           (A) The acreage reporting date contained In
             (2) Adding the totals from section 4(g)(1) to the                                       the Special Provisions;
                    amount of appraised or harvested production for                             (B) The date determined In accordance with
                    all of the insured planted acreage; and                                           sections 7(a)(1) or (2); or
             (3) Dividing the totals in section 4(g)(2} by the total                            (C) FIVe (5) days after the end of the late
                   number of acres in the unit.                                                      planting period for the Insured crop, if
        {h) The applicable premium rate, or formula to calculate                                     applicable.
             the premium rate, and transitional yield will be those             (b) If you do not have a share In an Insured crop in the
             contained in the actuarial documents except, In the                     county for the crop year, you must submit an acreage
             case of high risk land, a written agreement may be                      report on or before the acreage reporting date, so
             requested to change such transitional yield or                          Indicating.
             premium rate.                                                      (c) Your acreage report must Include the following
 5.     Contract Changes                                                             Information, If applicable:
       (a) We may change the terms of your coverage under                            (1) All acreage of the crop In the county (Insurable
            this policy from year to year.                                                 and not Insurable) in which you have a share;
       (b) Any changes In policy provisions, premium rates, and                     (2) Your share at the time coverage begins;
            program dates (except as allowed herein or as                            {3) The practice;
            specified In section 4) can be viewed on the RMA                         (4) The type; and
            website at hHD;/(Www.rma.ussfa.QOV/ or a successor                      (5) The date the insured crop was planted.
 )          website not later than the contract change date                     (d) Regarding the ability to revise an acreage report you
            contained In the Crop Provisions. We may only revise                    have submitted to us:
            this Information after the contract change date to                      (1) For planted acreage, you cannot revise any
            correct clear errors (For example, the price for com                          Information pertaining to the planted acreage
            was announced at $25.00 per bushel instead of $2.50                            after the acreage reporting date without our
           per bushel or the final planting date should be May 1 0                        consent (Consent may only be provided when no
           but the final planting date In the Special Provisions                          cause of loss has occurred; our appraisal has
           states August 10).                                                             determined that the Insured crop will produce at
       (c) After the contract change date, all changes specified                          least 90 percent of the yield used to determine
           In section 5(b) will also be available upon request                            your Fmal Guarantee for the unit ('mctuding
           from your crop insurance agent. You will be provided,                          reported and unreported acreage), except when
           in writing, a copy of the changes to the Basic                                 there are unreported units (see section 7(f)); the
           Provisions and Crop Provisions and a copy of the                               Information on the acreage report Is clearly
           Special Provisions not later than 30 days prior to the                         transposed; you provide adequate evidence that
           cancellation date for the Insured crop. Acceptance of                          we or someone from USDA have committed an
           the changes win be conclusively presumed In the                                error regarding the lnfonnation on your acreage
           absence of notice from you to change or cancel your                            report; or If expressly permitted by the policy);
           insurance coverage.                                                      (2) For prevented planting acreage reported on the
6.     [Reserved]                                                                         acreage report, you cannot revise any
7.     Report of Acreage                                                                  Information pertaining to the prevented planting
       (a) An annual acreage report must be submitted to us on                            acreage after the report Is lnltlafty submitted to us
           our form for each Insured crop in the county on or                             without our consent (Consent may only be
           before the acreage reporting date contained in the                             provided when information on the acreage report
           Special Provisions, except as follows:                                         is clearly transposed or you provide adequate
           (1) If you Insure multiple crops with us that have final                       evidence that we or someone from USDA have
               planting dates on or after August 15 but before                           committed an error regarding the information on
               December 31, you must submit an acreage                                    your acreage report);
               report for all such crops on or before the latest                    {3) For prevented planting acreage not reported on
               applicable acreage reporting date for such crops;                          the acreage report, you cannot revise your
               and                                                                        acreage report to add prevented planting
           (2) If you insure multiple crops with us that have final                       acreage;
               planting dates on or after December 31 but


C 2004 National Crop Insurance Services, Inc.                      Page10of26


                                                               EXHIBIT 4                                                  34
.       .,.
                (4) If you request an acreage measurement prior to                          (2) In addition to the other adjustments specified h
                     the acreage reporting date and submit                                        section 7(g)(1), If you misreport any lnformatiot
                     documentation of such request and an acreage                                 that results in liabl&ty greater than 11 0.0 percen
                     report with estimated acreage by the acreage                                 or lower than 90.0 percent of the actual fiabilit
                     reporting     date, you must provide            the                          determined for the unit, any Indemnity, preventet
                     measurement to us, we will revise your acreage                               planting payment, or replanting payment will bt
                     report if there Is a discrepancy, and no Indemnity,                          based on the amount of liability detennlned 11
                    prevented planting payment or replant payment                                 accordance with section 7(g){1 )(I) or (II) and wi
                    will be paid until the acreage measurement has                                be reduced In an amount proportionate with tht
                    been received by us (Failure to provide the                                   amount of liability that Is misreported In excess o
                    measurement to us will result In the application of                          the tolerances stated In this section (Fo
                    section 7(g) if the estimated acreage Is not                                 example, If the actual liability Is determined to bt
                    correct and estimated acreage under this section                             $100.00, but you reported liability of $120.00, an~
                    will no longer be accepted for any subsequent                                Indemnity, prevented planting payment o
                    acreage report);                                                             replanting payment will be reduced by 10.(
               (5) If there Is an Irreconcilable difference between:                             percent ($120.00 I $100.00 = 1.20, and 1.20 -
                    (I) The acreage measured by FSA or a                                             =
                                                                                                 1.10 0.10}).
                         measuring service and our on-farm                            (h) If we discover you have Incorrectly reported anl
                         measurement, our on-farm measurement will                         Information on the acreage report for any crop year
                         be used; or                                                       you may be required to provide documentation lr
                   (U}   The acreage measured by a measuring                               subsequent crop years substantiating your report o
                          service,     other     than      our     on-farm                 acreage for those crop years, including, but no
                          measurement,       and     FSA,      the    FSA                  limited to, an acreage measurement service at you
                          measurement will be used; and                                    own expense. If the correction of any misreportec
               (6) If the acreage report has been revised In                               information would affect an Indemnity, preventec
                     accordance with section 7(d)(1), (2), (4), or (5),                    planting payment or replant payment that was paid ir
                     the Information on the initial acreage report will                    a prior crop year, such claim will be adjusted and yol
                     not be considered mlsreported for the purposes                        will be required to repay any overpaid amounts.
                     of section 7(g).                                                (I) Errors in reporting units may be corrected by us at thE
          (e) We may elect to determine all premiums and                                   time of adjusting a loss to reduce our liability and tc
               indemnities based on the information you submit on                          conform to applicable unit division guidelines.
               the acreage report or upon the factual circumstances             8.   Annual Premium and Administrative Fees
               we determine to have existed, subject to the                          (a) The annual premium is eamed and payable at the
               provisions contained In section 7(g).                                      time coverage begins. You will be billed for the
         (f) If you do not submit an acreage report by the acreage                        premium and administrative fee not earlier than the
               reporting date, or If you fall to report all units, we may                 premium bWing date specified in the Specia
               elect to determine by unit the insurable crop acreage,                      Provisions.
               share, type and practice, or to deny liability on such                (b) Premium or administrative fees owed by you will bE
              units. If we deny JiabUity for the unreported units, your                   offset from an Indemnity or prevented plantin~
               share of any production from the unreported units will                     payment due you In accordance with section 3(e).
              be allocated, for loss purposes only, as production to                 (c) Your annual premium amount Is determined by:
              count to the reported units In proportion to the liability                  (1) Multiplying the Approved Yield times the
              on each reported unit. However, such production will                              Coverage Level, times the Base Premium Rate,
              not be allocated to prevented planting acreage or                                 and times the Base Price as defined in the
              otherwise affect any prevented planting payment.                                  Commodity Exchange Endorsement;
         (g) You must provide all required reports and you are                            (2) Multiplying the Approved Yield times the
              responsible for the accuracy of all Information                                   Coverage Level, times the CRC Base Rate, and
              contained In those reports. You should verify the                                 times the CRC Low Price Factor specified in the
              information on all such reports prior to submitting                               actuarial documents;
              them to us.                                                                 (3) Multiplying the Approved Yield times the
              (1} If you submit information on any report that is                               Coverage Level, times the Base Premium Rate,
                   different than what is determined to be correct                              and times the CRC High Price Factor specified in
                   and such Information results In:                                             the actuarial documents;
                   (I) A lower liability than the actual liability                        (4) Adding sections 8(c)(1), (2), and (3);
                         determined, the Final Guarantee on the unit                     (5) Multiplying the result of section 8(c)(4) times the
                         will be reduced to an amount consistent with                           Acres Insured, times your Share at the time
                         the reported Information (In the event the                             coverage begins, and as applicable, times any
                         Insurable acreage Is under-reported for any                            CRC Unit Option Factor; Y~eld Adjustment
                         unit, all production or value from Insurable                           Surcharge; and/or CRC Enterprise Option Factor;
                         acreage in that unit will be considered                         (6) Multiplying the result of section 8(c)(5) times the
                         production or value to count In determining                            applicable producer subsidy percentage to
                         the Indemnity); or                                                     calculate the appropriate amount of subsidy. The
                   (II) A higher liability than the actual liability                            producer subsidy percentage is based upon the
                         determined, the information contained In the                           coverage level and is contained in the actuarial
    )                    acreage report will be revised to be                                   documents; and
                         consistent with the correct Information.                        (7) Subtracting section B(c)(6) from section B(c)(5).



    C 2004 National Crop Insurance Services, Inc.                    Page 11 of 26

                                                                EXHIBIT 4                                                      35
   - (d) The information needed to determine the premium                               if grain sorghum had already been planted ano
           rate and any premium adjustment percentages that                            harvested on the same acreage during the crop
           may apply are contained In the actuarial documents                          year);
           or an approved written agreement.                                       (5) That is planted for the development or production
     (e) In addition to the premium charged:                                           of hybrid seed or for experimental purposes,
          (1) You, unless otherwise authorized In 7 CFR part                           unless pennitted by the Crop Provisions; or
                400, must pay an administrative fee each crop                      (6) That Is used solely for wildlife protection or
                year of $30 per crop per county.                                       management. If the lease states that specific
          (2) The administrative fee must be paid no later than                        acreage must remain unharvested, only that
                the time that premium is due.                                          acreage Is uninsurable. If the lease specifies that
          (3) Payment of an administrative fee will not be                             a percentage of the crop must be left
                required if you file a bona fide zero acreage                          unharvested, your share will be reduced by such
                report on or before the acreage reporting date for                     percentage.
                the crop. If you falsely file a zero acreage report,          (c) Although certain pollcy documents may state that a
                you may be subject to criminal and administrative                 crop type, class, variety or practice Is not Insurable, It
                sanctions.                                                        does not mean all other crop types, classes, varieties
          (4) The administrative fee will be waived If you                        or practices are Insurable. To be insurable the crop
                request It and:                                                   type, class, variety or practice must meet all the
                (I) You qualify as a limited resource farmer, or                  conditions In this section.
                (II) You were Insured prior to the 2005 crop year        10. Insurable Acreage
                     or for the 2005 crop year and your                       (a) Acreage planted to the Insured crop In which you
                     administrative fee was waived for one or                     have a share Is insurable except acreage:
                     more of those crop years because you                         (1) That has not been planted and harvested or
                     qualified as a limited resource farmer under                     insured (Including Insured acreage that was
                     a policy definition previously In effect, and                    prevented from being planted) In at least one of
                     you remain qualified as a limited resource                       the three previous crop years unless you can
                     farmer under the definition that was In effect                   show that:
                     at the time the administrative fee was                           (I) Such acreage was not planted:
                     waived.                                                              (A) In at least two of the previous three crop
         (5) Failure to pay the administrative fees when due                                   years to comply with any other USDA
                may make you ineligible for certain other USDA                                    program;
                benefits.                                                                      (B) Because of crop rotation (e.g., com,
    (f) If the amount of premium (gross premium less                                                soybeans, alfalfa; and the alfalfa
         premium subsidy paid on your behalf by FCIC) and                                           remained for four years before the
         administrative fee you are required to pay for any                                         acreage was planted to com again); or
         acreage exceeds the liability for the acreage,                                        (C) Because a perennial tree, vine, or bush
         coverage for those acres will not be provided (no                                          crop was grown on the acreage;
         premium or administrative fee wiU be due and no                                 (II) The Crop Provisions or a written agreement
         Indemnity will be paid for such acreage).                                             specifically allow Insurance for such
9. Insured Crop                                                                                acreage; or
    (a) The insured crop will be that shown on your accepted                             (Iii) Such acreage constitutes five percent or less
        application and as specified in the Crop Provisions or                                 of the Insured planted acreage In the unit;
        Special Provisions and must be grown on insurable                         (2)   That has been strip-mined, unless otherwise
        acreage.                                                                        approved by written agreement, or unless an
    (b) A crop which will NOT be Insured will include, but will                          agricultural commodity other than a cover, hay, or
        not be limited to, any crop:                                                    forage crop (except com silage), has been
        (1) That is not grown on planted acreage (except for                             harvested from the acreage for at least five crop
               the purposes of prevented planting coverage), or                         years after the strip·mlned land was reclaimed;
               that Is a type, class or variety or where the                      (3)    For which the actuarial documents do not provide
              conditions under which the crop is planted are                            the Information necessary to determine the
               not generally recognized for the area (For                               premium rate, unless Insurance is allowed by a
               example, where agricultural experts determine                            written agreement;
              that planting a non-Irrigated com crop after a                      (4)   On which the insured crop Is damaged and It Is
              failed small grain crop on the same acreage In                            practical to replant the Insured crop, but the
              the same crop year Is not appropriate for the                             Insured crop Is not replanted;
              area);                                                             (5)    That is lnterplanted, unless allowed by the Crop
        (2) For which the Information necessary for                                     Provisions;
              Insurance (premium rate, etc.) Is not included In                  (6)    That Is otherwise restricted by the Crop
              the actuarial documents, unless such Information                          Provisions or Special Provisions;
              is provided by a written agreement;                                (7)    That Is planted In any manner other than as
        (3) That Is a volunteer crop;                                                   specified In the policy provisions for the crop;
        (4) Planted following the same crop on the same                          (8)    Of a second crop, if you elect not to insure such
              acreage and the first planting of the crop has                            acreage when an indemnity for a first Insured
              been harvested in the same crop year unless                               crop may be subject to reduction in accordance
              specifically permitted by the Crop Provisions or                          with the provisions of section 16 and you intend
              the Special Provisions (For example, the second                           to collect an Indemnity payment that Is equal to
              planting of grain sorghum would not be Insurable                          100 percent of the insurable loss for the first

tO 2004 National Crop Insurance Services, Inc.                 Page 12 of26


                                                           EXHIBIT 4                                                    36
                   Insured crop acreage. This election must be                          the reasonable expectation of recetvmg adequate
                  made on a first Insured crop unit basis. For                          water at the time coverage begins, to carry out a gooc
                  example, if the first insured ctop unit contains 40                   irrigation practice. If you knew or had reason to knov.
                  planted acres that may be subject to an                               that your water may be reduced before coverage
                  indemnity reduction, then no second crop can be                      begins, no reasonable expectation exists.
                  Insured on any of the 40 acres. In this case:                   (c) Notwithstanding the provisions in section 9{b)(2), r
                  (i) If the first insured crop is Insured under this                  acreage is Irrigated and we do not provide a premlurr
                         policy, you must provide written notice to us                 rate for an irrigated practice, you may either repon
                         of your election not to Insure acreage of a                   and insure the irrigated acreage as "non-irrigated.~ ot
                         second crop at the time the first Insured crop                report the Irrigated acreage as not Insured.
                         acreage Is released by us {if no acreage In              (d) We may restrict the amount of acreage that we will
                         the first Insured crop unit Is released, this                 Insure to the amount allowed under any acreage
                         election must be made by the earlier of the                   limitation program established by the USDA If we
                         acreage reporting date for the second crop                    notify you of that restriction prfor to the sales closing
                         or when you sign the claim for Indemnity for                  date.
                         the first Insured crop) or, if the first Insured    11. Share Insured
                         crop Is Insured under the Group Risk                     (a) Insurance will attach only to the share of the person
                         Protection Plan of Insurance (7 CFR part                      completing the appfteation and wUI not extend to any
                         407), this election must be made before the                   other person having a share in the crop unless the
                         second crop insured under this policy Is                      application clearly states that:
                        planted, and if you fail to provide such                       (1) The insurance is requested for an entity such as
                        notice, the second crop acreage will be                              a partnership or a joint venture; or
                        Insured In accordance with the applicable                      (2) You as landlord will insure your tenanrs share, or
                        policy provisions and you must repay any                             you as tenant will insure your landlord's share. In
                        overpaid Indemnity for the first Insured crop;                       this event, you must provide evidence of the
                 (li) In the event a second crop is planted and                              other party's approval (lease, power of attorney,
                        insured with a different Insurance provider,                         etc.). Such evidence will be retained by us. You
                        or planted and insured by a different person,                        also must clearly set forth the percentage shares
                        you must provide written notice to each                              of each person on the acreage report. For each
                        insurance provider that a second crop was                            landlord or tenant that is an Individual, you must
                        planted on acreage on which you had a first                          report the landlord's or tenant's social security
                        insured crop; and                                                    number. For each landlord or tenant that is a
                 (Iii) You must report the crop acreage that will                            person other than an Individual or for a trust
                        not be Insured on the applicable acreage                             administered by the Bureau of Indian Affairs, you
 )                      report; or                                                           must report each landlord's or tenanrs social
          (9) Of a crop planted following a second crop or                                   security number, employer Identification number,
                 following an insured crop that Is prevented from                            or other Identification number assigned for the
                being planted after a first Insured crop, unless it                          purposes of this policy.
                Is a practice that is generally recognized by                    {b) We may consider any acreage or interest reported by
                agricultural experts or the organic agricultural                      or for your spouse, child or any member of your
                industry for the area to plant three or more crops                    household to be included in your share.
                for harvest on the same acreage in the same                      (c) Acreage rented for a percentage of the crop, or a
                crop year, and additional coverage insurance                          lease containing provisions for BOTH a minimum
                provided under the authority of the Act is offered                    payment (such as a specified amount of cash,
                for the third or subsequent crop in the same crop                     bushels, pounds, etc.) AND a crop share will be
                year. Insurance will only be provided for a third or                  considered a crop share lease.
                subsequent crop as follows:                                     (d) Acreage rented for cash, or a lease containing
                (I) You must provide records acceptable to us                         provisions for EITHER a minimum payment OR a
                       that show:                                                     crop share (such as a 50/50 share or $100.00 per
                       (A) You have produced and harvested the                        acre, whichever is greater) will be considered a cash
                             Insured crop following two other crops                   lease.
                             harvested on the same acreage In the           12. Insurance Period
                             same crop year In at least two of the last         (a) Except for prevented planting coverage (see section
                            four years in which you produced the                      1B), coverage begins on each unit or part of a unit at
                             Insured crop; or                                        the later of:
                      (B) The applicable acreage has had three or                    {1) The date we accept your application (For the
                            more crops produced and harvested on                            purposes of this paragraph, the date of
                            it In at least two of the last four years in                    acceptance is the date that you submit a properly
                            which the insured crop was grown on it;                         executed application in accordance wHh section
                            and                                                            3);
               (II) The amount of Insurable acreage will not                          {2) The date the insured crop is planted; or
                      exceed 100 percent of the greatest number                       (3) The calendar date contained in the Crop
                      of acres for which you provide the records                          Provisions for the beginning of the Insurance
                      required in section 1O(a)(9)(1)(A) or (B).                          period.
     (b) If Insurance Is provided for an irrigated practice, you                  (b) Coverage ends at the earliest of:
         must report as Irrigated only that acreage for which                         (1) Total destruction of the insured crop on the unit;
         you have adequate facilities and adequate water, or                          (2) Harvest of the unH;


C 2004 National Crop Insurance Services, Inc.                      Page 13 of26


                                                               EXHIBIT 4                                                   37
      •'         (3) Final adjustment of a Joss on a unit;                         (2) Initially planted prior to the earliest planting date
                 (4) The calendar date contained In the Crop                            established by the Special Provisions; or
                      Provisions for the end of the insurance period;              (3) On which one replanting payment has already
                 (5) Abandonment of the crop on the unit; or                            been allowed for the crop year.
                 (6) As otheJWise specified In the Crop Provisions.          (c) The replanting payment per acre will be your actual
    f 3. Causes of Loss                                                            cost for replanting, but will not exceed the amount
         The insurance provided Is against only unavoidable Joss                   determined In accordance with the Crop Provisions.
          directly caused by specific causes of loss contained In the        (d) No replanting payment will be paid If we detennlne it
         Crop Provisions. All specified causes of Joss, except                     Is not practical to replant.
         where the Crop Provisions specifically cover loss of            15. Duties In the Event of Damage, Loss, Abandonment,
         revenue due to a reduced price In the marketplace, must             Destruction, or Alternative Use of Crop or Acreage.
         be due to a naturally occurring event. All other causes of          Your Duties -
         loss, Including but not limited to the following, are NOT           (a) In case of damage to any Insured crop you must
         covered:                                                                 (1) Protect the crop from further damage by
         (a) Negligence, mismanagement, or wrongdoing by you,                           providing sufficient care;
                any member of your family or household, your                      (2) Give us notice within 72 hours of your Initial
                tenants, or employees;                                                  discovery of damage (but not later than 15 days
         (b) Failure to follow recognized good farming practices                        after the end of the insurance period), by unit, for
                for the Insured crop;                                                   each Insured crop;
         (c) Water that is contained by or within structures that are             (3) If representative samples are required by the
                designed to contain a specific amount of water, such                    Crop Provisions, leave representative samples
                as dams, locks or reservoir projects, etc., on any                     Intact of the unharvested crop if you report
                acreage when such water stays within the designed                      damage less than 15 days before the time you
                limits (For example, a dam is designed to contain                      begin harvest or during harvest of the damaged
               water to an elevation of 1,200 feet but you plant a                     unit (The samples must be left Intact until we
               crop on acreage at an elevation of 1,1 00 feet. A storm                 Inspect them or until 15 days after completion of
               causes the water behind the dam to rise to an                           harvest on the unit, whichever Is earlier. Unless
               elevation of 1,200 feet. Under such circumstances,                      otheJWise specified In the Crop Provisions or
               the resulting damage would not be caused by an                          Special Provisions, the samples of the crop In
               insurable cause of loss. However, if you planted on                     each field in the unit must be 10 feet wide and
               acreage that was above 1,200 feet elevation, any                        extend the entire length of the row, if the crop Is
               damage caused by water that exceeded that elevation                     planted in rows, or if the crop Is not planted in
               would be caused by an insurable cause of loss);                         rows, the longest dimension of the field. The
        (d) Failure or breakdown of the Irrigation equipment or                        period to retain representative samples may be
               facilities unless the failure or breakdown is due to a                  extended if it Is necessary to accurately
 )             cause of Joss specified In the Crop Provisions (If                      detennlne the Joss. You will be notified in writing
               damage is due to an Insured cause, you must make                        of any such extension); and
               all reasonable efforts to restore the equipment or                 (4) Cooperate with us in the investigation or
               facilities to proper working order within a reasonable                  settlement of the claim, and, as often as we
               amount of time unless we determine ills not practical                   reasonably require:
              to do so. Cost will not be considered when                               (I) Show us the damaged crop;
              determining whether it is practical to restore the                       (li) Allow us to remove samples of the insured
              equipment or facilities);                                                      crop; and
        (e) Failure to cany out a good irrigation practice for the                     (iii) Provide us with records and documents we
              insured crop, If applicable; or                                                request and permit us to make copies; and
        (f) Any cause of loss that results in damage that is not                  (5) Give us notice of your expected revenue loss not
              evident or would not have been evident during the                        later than 45 days after the date the Harvest
              insurance period, Including, but not limited to, damage                  Price Is released.
              that only becomes evident after the end of the                (b) You must obtain consent from us before, and notify us
              insurance period unless expressly authorized in the                after you:
              Crop Provisions. Even though we may not Inspect the                (1) Destroy any of the insured crop that is not
              damaged crop until after the end of the insurance                        harvested;
              period, damage due to insured causes that would                    (2) Put the Insured crop to an alternative use;
              have been evident during the insurance period will be              (3) Put the acreage to another use; or
              covered.                                                           (4) Abandon any portion of the Insured crop. We will
14. Replanting Payment                                                                 not give consent for any of the actions in sections
       (a) If allowed by the Crop Provisions, a replanting                             15(b)(1) through (4) if it is practical to replant the
           payment may be made on an Insured crop replanted                            crop or until we have made an appraisal of the
           after we have given consent and the acreage                                 potential production of the crop.
           replanted Is at least the lesser of 20 acres or 20               (c) In addition to complying with the notice requirements,
           percent of the insured planted acreage for the unit (as               you must submit a claim for Indemnity declaring the
           determined on the final planting date or within the late              amount of your loss not later than 60 days after the
           planting period If a late planting period Is applicable).             Harvest Price Is released unless you request an
       (b) No replanting payment will be made on acreage:                        extension in writing and we agree to such extension.
           (1) On which our appraisal establishes that                           Extensions will only be granted if the amount of the
)               production will exceed the level set by the Crop                 loss cannot be determined within such time period
                Provisions;                                                      because the lnfonnation needed to determine the


~ 2004 National    Crop Insurance Services, Inc.                 Page14of26


                                                             EXHIBIT 4                                                  38
           amount of the loss Is not available. The claim for                             indemnity or other payment is due, you will sti
           indemnity must include all information we require to                           be required to pay the premium due under th
           settle the claim. Failure to submit a claim or provide                         policy for the unit); and
           the required information will result In no indemnity,                    (2) Failure to comply with other sections of the pollc
           prevented planting payment or replant payment (Even                            will subject you to the consequences specified i
           though no indemnity or other payment is due, you will                          those sections.
           still be required to pay the premium due under the                  Our Duties-
           policy for the unit).                                               (a) If you have complied with all the policy provisions, W•
      (d) You must:                                                                 will pay your loss within 30 days after the later of:
           (1) Provide a complete harvesting and marketing                          (1) We reach agreement with you;
                   record of each insured crop by unit Including                    (2) Completion of arbitration, reconsideration c
                  separate records showing the same information                          determinations regarding good farming practice:
                  for production from any acreage not insured. In                        or any other appeal that results In an award II
                  addition, If you Insure any acreage that may be                        your favor, unless we exercise our right to appec
                  subject to an Indemnity reduction as specified In                      such decision;
                  section 16(e)(2) (for example, you planted a                      (3) Completion of any investigation by USDA, i
                  second crop on acreage where a first Insured                           applicable, of your current or any past claim fa
                  crop had an insurable loss and you do not qualify                      indemnity if no evidence of wrongdoing has beer
                  for the double cropping exemption), you must                           found (If any evidence of wrongdoing has beer
                  provide separate records of production from such                       discovered, the amount of any Indemnity
                  acreage for all Insured crops planted on the                           prevented planting or replant overpayment as 1
                  acreage. For example, if you have an Insurable                         result of such wrongdoing may be offset from an~
                  loss on 10 acres of wheat and subsequently plant                       Indemnity or prevented planting payment owed t1
                 cotton on the same 1 0 acres, you must provide                          you); or
                  records of the wheat and cotton production on                    (4) The entry of a final judgment by a court o
                 the 10 acres separate from any other wheat and                          competent jurisdiction.
                 cotton production that may be planted In the                 (b) In the event we are unable to pay your loss within 3(
                 same unit. If you fall to provide such separate                   days, we will give you notice of our Intentions withir
                 records, we will allocate the production of each                  the 30-day period.
                 crop to the acreage In proportion to our liability           (c) We may defer the adjustment of a loss until thE
                 for the acreage; and                                              amount of loss can be accurately determined. We wil
          (2) Upon our request, or that of any USDA employee                       not pay for additional damage resulting from you
                 authorized to conduct Investigations of the crop                  failure to provide sufficient care for the crop during thE
                 insurance program, submit to an examination                       deferral period.
                 under oath.                                                  (d) We recognize and apply the loss adjustmen
     (e) You must establish the total production or value                          procedures established or approved by FCIC.
          received for the insured crop on the unit, that any loss       16. Production Included In Determining an Indemnity anc
          of production or value occurred during the Insurance                Pa~ntReducUons
         period, and that the Joss of production or value was                  (a) The total production to be counted for a unit wil
          directly caused by one or more of the Insured causes                      include all production determined In accordance witt
          specified In the Crop Provisions.                                         the policy.
    (f) In the event you are prevented from planting an                       (b) Appraised production will be used to calculate your
         Insured crop which has prevented planting coverage,                       claim if you are not going to harvest your acreage
         you must notify us within 72 hours after:                                 Such appraisals may be conducted after the end 01
         (1) The final planting date, If you do not intend to                       the Insurance period. If you harvest the crop after the
                plant the Insured crop during the late planting                    crop has been appraised:
                period or If a late planting period is not                         (1) You must provide us with the amount ol
                applicable; or                                                           harvested production; and
         (2) You determine you will not be able to plant the                       (2} If the harvested production exceeds the
                insured crop within any applicable late planting                         appraised production, claims will be adjusted
                period.                                                                  using the harvested production, and you will be
    (g) All notices required In this section that must be                                required to repay any overpaid indemnity; or
         received by us within 72 hours may be made by                             (3) If the harvested production is less than the
         telephone or in person to your crop insurance agent                             appraised production, and:
         but must be confirmed in writing within 15 days.                                (I) You harvest after the end of the Insurance
    (h) It Is your duty to prove you have complied with all                                   period, your appraised production will be
         provisions of this policy.                                                           used to adjust the loss unless you can prove
         (1) Failure to comply with the requirements of                                       that no additional causes of loss or
               section 15(c) (Your Duties) will result In denial of                           deterioration of the crop occurred after the
               your claim for indemnity or prevented planting or                              end of the insurance period; or
               replant payment for the acreage for which failure                         (ii) You harvest before the end of the insurance
               occurred. Failure to comply with all other                                     period, your harvested production will be
               requirements of this section will result In denial of                          used to adjust the loss.
               your claim for Indemnity or prevented planting or              (c) The amount of an indemnity that may be determined
)              replant payment for the acreage for which the                       under the applicable provisions of your policy may be
               failure occurred, unless we still have the ability to               reduced by an amount, determined in accordance
               accurately adjust the loss (Even though no                          with the Crop Provisions or Special Provisions. to

® 2004 National Crop Insurance Services, inc.                  Page 15 of26

                                                          EXHIBIT 4                                                    39
      ••   reflect out.of-pocket expenses that were not incurred               (f) The reduction in the amount of indemnity or
           by you as a result of not planting, caring for, or                        prevented planting payment and premium specified In
           harvesting the crop. Indemnities paid for acreage                         sections 16(d) and 16(e), as applicable, will apply:
           prevented from being planted will be based on a                           (1) Notwithstanding the priority contained In the
           reduced Final Guarantee as provided for In the policy                          Agreement to Insure section, which states that
           and will not be further reduced to reflect expenses not                        the Crop Provisions have priority over the Basic
           Incurred.                                                                      Provisions when a conflict exists, to any premium
       (d) With respect to acreage where you have suffered an                             owed or Indemnity or prevented planting payment
            Insurable loss to planted acreage of your first Insured                       made in accordance with the Crop Provisions,
           crop In the crop year, except In the case of double                            and any applicable endorsement.
           cropping described In section 16(g):                                      (2) Even If another person plants the second crop on
            (1) You may elect to not plant or to plant and not                            any acreage where the first Insured crop was
                 Insure a second crop on the same acreage for                             planted or was prevented from being planted, as
                 harvest In the same crop year and collect an                             applicable.
                 Indemnity payment that Is equal to 100 percent of                   (3) For prevented planting only:
                 the insurable loss for the first insured crop; or                        (I) If a volunteer crop or cover crop Is hayed or
           (2) You may elect to plant and Insure a second crop                                 grazed from the same acreage, after the late
                 on the same acreage for harvest In the same                                   planting period (or after the final planting
                 crop year (you will pay the full premium and, If                              date if a late planting period Is not
                 there Is an Insurable loss to the second crop,                                applicable) for the first Insured crop in the
                 receive the full amount of Indemnity that may be                              same crop year, or Is otherwise harvested
                 due for the second crop, regardless of whether                                anytime after the late planting period (or after
                there Is a subsequent crop planted on the same                                the final planting date if a late planting period
                acreage) and:                                                                 Is not applicable); or
                 (i) Collect an Indemnity payment that is 35                             (II) If you receive cash rent for any acreage on
                       percent of the Insurable loss for the first                            which you were prevented from planting.
                       Insured crop;                                           (g) You may receive a tun indemnity, or a fuH prevented
                (II) Be responsible for premium that Is 35                          planting payment for a first insured crop when a
                       percent of the premium that you would                        second crop is planted on the same acreage in the
                       otherwise owe for the first Insured crop; and                same crop year, regardless of whether or not the
                (iii) If the second crop does not suffer an                         second crop Is Insured or sustains an insurable loss, if
                       Insurable loss:                                              each of the following conditions are met
                       (A) Collect an indemnity payment for the                     (1) It Is a practice that Is generally recognized by
                            other 65 percent of Insurable loss that                      agricultural experts or the organic agricultural
                            was not previously paid under section                        Industry for the area to plant two or more crops
  )                         16(d)(2)(1); and                                             for harvest in the same crop year;
                       (B) Be responsible for the remainder of the                  (2) The second or more crops are customarily
                            premium for the first Insured crop that                      planted after the first insured crop for harvest on
                            you did not pay under section                                the same acreage In the same crop year in the
                            16(d)(2)(ii).                                                area;
      (e) With respect to acreage where you were prevented                          (3) Additional coverage Insurance offered under the
          from planting the first Insured crop in the crop year,                         authority of the Act Is avaNable In the county on
          except in the case of double cropping described in                             the two or more crops that are double cropped;
          section 16(g):                                                            (4) You provide records acceptable to us of acreage
          (1) If a second crop Is not planted on the same                                and production that show you have double
                acreage for harvest In the same crop year, you                           cropped acreage in at least two of the last four
                may collect a prevented planting payment that is                         crop years In which the first Insured crop was
                equal to 100 percent of the prevented planting                           planted, or that show the applicable acreage was
                payment for the acreage for the first insured crop;                      double cropped In at least two of the last four
               or                                                                        crop years in which the first Insured crop was
          (2) If a second crop Is planted on the same acreage                            grown on It; and
               for harvest In the same crop year (you will pay                     (5) In the case of prevented planting, the second
               the full premium and, If there Is an insurable loss                       crop Is not planted on or prior to the final planting
               to the second crop, receive the full amount of                            date or, If applicable, prior to the end of the late
               Indemnity that may be due for the second crop,                            planting period for the first insured crop.
               regardless of whether there is a subsequent crop               (h) The receipt of a full indemnity or prevented planting
               planted on the same acreage) and:                                   payment on both crops that are double cropped is
               (I) Provided the second crop Is not planted on                      limited to the number of acres for which you can
                      or before the final planting date or during the              demonstrate you have double cropped or that have
                      late planting period (as applicable) for the                 been historically double cropped as specified In
                      first Insured crop, you may collect a                        section 16(g).
                     prevented planting payment that Is 35                    (i) If any Federal or State agency requires destruction of
                     percent of the prevented planting payment                     any Insured crop or crop production, as applicable,
                     for the first insured crop; and                               because it contains levels of a substance, or has a
               (II) Be responsible for premium that is 35                          condition, that Is Injurious to human or animal health
 )                   percent of the premium that you would                         In excess of the maximum amounts allowed by the
                     otherwise owe for the first Insured crop.                     Food and Drug Administration, other public health

C 2004 National Crop Insurance Services, Inc.                   Page 16of26


                                                             EXHIBIT 4                                                    40
     ••
               organizations of the United States or an agency of the                              year for the insured crop In the county
               applicable State, you must destroy the insured crop or                              provided insurance has been in force
              crop production, as applicable, and certify that such                                continuously since that date. Cancellation fo1
              insured crop or crop production has been destroyed                                   the purpose of transferring the policy to a
              prior to receiving an indemnity payment. Failure to                                  different Insurance provider for the
              destroy the insured crop or crop production, as                                      subsequent crop year will not be conslderec
              applicable, will result ln you having to repay any                                   a break in continuity for the purpose of the
              indemnity paid and you may be subject to                                             preceding sentence;
              administrative sanctions in accordance with section                       (2) You Include any acreage of the Insured crop thai
              515(h) of the Act and 7 CFR part 400, subpart A, and                            was prevented from being planted on yoUI
              any applicable civil or criminal sanctions.                                     acreage report; and
 17. Late Planting                                                                      (3) You did not plant the Insured crop during or after
      Unless limited by the Crop Provisions, Insurance will be                                the late planting period. If such acreage was
      provided for acreage planted to the Insured crop after the                             planted to the insured crop during or after the late
      final planting date in accordance with the foftowing:                                  planting period, It is covered under the fate
      (a) The Final Guarantee for each acre planted to the                                   planting provisions.
            insured crop during the late planting period will be                  (b) The actuarial documents may contain additional
             reduced by 1 percent per day for each day planted                          levels of prevented planting coverage that you may
            after the final planting date.                                              purchase for the Insured crop:
      (b) Acreage planted after the late planting period (or after                      (1) Such purchase must be made on or before the
             the final planting date for crops that do not have a late                       sales closing date.
            planting period) may be Insured as follows:                                 (2) If you do not purchase one of those addHional
            (1) The Anal Guarantee for each acre planted as                                  levels by the sales closing date, you will receive
                    speclfl8d In this subsection will be detennined by                       the prevented planting coverage specified in the
                    multiplying the Anal Guarantee that Is provided                          Crop Provisions.
                    for acreage of the insured crop that is timely                      (3) If you have an MPCI Catastrophic Risk Protection
                   planted by the prevented planting coverage level                          Endorsement for any acreage of •high risk land,"
                   percentage you elected, or that is contained In                           the additional levels of prevented planting
                   the Crop Provisions If you did not elect a                                coverage will not be available for that acreage;
                   prevented planting coverage level percentage;                             and
            (2) Planting on such acreage must have been                                (4) You may not Increase your elected or assigned
                   prevented by the final planting date (or during the                       preventing planting coverage level for any crop
                   late planting period, if applicable) by an insurable                      year if a cause of loss that will or could prevent
                   cause occurring within the insurance period for                           planting Is evident prior to the time you wish to
 )                 prevented planting coverage; and                                          change your prevented planting coverage level.
           (3) All production from insured acreage as specified                  (c) The premium amount for acreage that is prevented
                   in this section will be Included as production to                   from being planted will be the same as that for timely
                  count for the unit.                                                 planted acreage except as specified in section 16(e).
     (c) The premium amount for insurable acreage specified                            If the amount of premium you are required to pay
           in this section will be the same as that for timely                        (gross premium less our subsidy) for acreage that Is
           planted acreage. If the amount of premium you are                          prevented from being planted exceeds the liability on
          required to pay (gross premium less our subsidy) for                        such acreage, coverage for those acres will not be
          such acreage exceeds the liability, coverage for those                      provided (no premium will be due and no indemnity
          acres will not be provided (no premium will be due,                         will be paid for such acreage).
          and no indemnity will be paid).                                       (d) Drought or failure of the Irrigation water supply will be
    (d) Any acreage on which an insured cause of loss is a                            considered to be an Insurable cause of loss for the
          material factor In preventing completion of planting, as                    purposes of prevented planting only if on the final
          specified In the definition of "planted acreage" (e.g.,                     planting date (or within the late planting period If you
          seed Is broadcast on the soli surface but cannot be                         elect to try to plant the crop):
          lnco1p0rated) will be considered as acreage planted                         (1) For non-Irrigated acreage, the area that is
          after the final planting date and the Final Guarantee                             prevented from being planted has Insufficient soil
          will be calculated In accordance with section 17(b)(1).                           moisture for germination of seed or progress
18. Prevented Planting                                                                      toward crop maturity due to a prolonged period of
    (a) Unless limited by the policy provisions, a prevented                                dry weather. Prolonged precipitation deficiencies
          planting payment may be made to you for eligible                                  must be verifiable using Information collected by
          acreage if:                                                                       sources whose business it Is to record and study
          (1) You were prevented from planting the insured                                  the weather, including, but not limited to, local
                  crop (Failure to plant when other producers In the                        weather reporting stations of the National
                  area were planting will result In the denial of the                       Weather Service; or
                  prevented planting claim) by an insured cause                       (2) For Irrigated acreage, there Is not a reasonable
                 that occurs:                                                               expectation of having adequate water to carry out
                 (i) On or after the sales closing date contained                           an Irrigated practice. If you knew or had reason to
                        In the Special Provisions for the insured crop                      know that your water is reduced before the final
                        In the county for the crop year the application                     planting date, no reasonable expectation existed.
                       for Insurance Is accepted; or                            (e) The maximum number of acres that may be eligible
                 (ii) For any subsequent crop year, on or after                      for a prevented planting payment for any crop will be
                       the sales closing date for the previous crop                  detennlned as follows:

C 2004 National Crop Insurance Services, Inc.                     Page 17of26

                                                             EXHIBIT 4                                                     41
         ..     {1) The total number of acres eligible for prevented                               the eligible acres. If a processor
                         planting coverage for all crops cannot exceed the                         cancels or does not provide
                         number of acres of cropland In your fanning                               contracts, or reduces the contracted
                         operation for the crop year, unless you are                               acreage or production from what
                         eligible for prevented planting coverage on                               would have otherwise been allowed,
                                                                                                   solely because the acreage was
                         double cropped acreage In accordance with
                                                                                                   prevented from being planted due to
                         section 18(f){4). The eUgible acres for each                              an Insured cause of loss, we may
                        Insured crop will be determined In accordance                             elect to detennlne the nunber of
                        with th e foilowrno• table:                                               acres eligible based on the number of
       Type of       Eligible acres If, In any of the 4 most Eligible acres If, In                acres or amount of production you
       Crop          recent crop years, you have planted any of the 4 most                        had contracted In the county In the
                     any crop In the county for which           recent crop years,                previous crop year. If you did not
                    prevented planting Insurance was           you have not                       have a processor contract In place for
                    available or have received a               planted any crop In                the previous crop year, you will not
                    prevented planting Insurance               the county for                     have any eligible prevented planting
                    guarantee.                                 which prevented                    acreage for the applicable processor
                                                               planting Insurance                 crop. The total eligible prevented
                                                               was available or                   planting acres In au counties cannot
                                                               have not received                  exceed the to1a1 nunber of acres or
                                                               a prevented                        amooot of production contracted In aJ
                                                               planting Insurance                 counties In the previous crop year.
                                                               guarantee.                       (2) Any eligible acreage determined in accordance
      {I) The       (A) The maximum number of acres            (B) The number of                       with the table contained In section 18(e)(1) will be
     crop Is not certified for APH purposes or lnstnd acres specified on                               reduced by subtracting the number of acres of
      required     acres reported for 1nstnnce for the         yoor Intended                           the crop (insured and uninsured) that are timely
     to be         crop In any one of the 4 most recent acreage report                                and late planted, Including acreage specified In
     contracted crop years (not Including reported             which Is submitted
     with a        prevented planting acreage that was to us by the sales                             section 17(b).
     processor planted to a second crop unless you closing date for all                    (f) Regardless of the number of eligible acres
     to be         meet the double cropping                    crops you Insure                 determined In section 18(e), prevented planting
     Insured       requirements In section 18(1)(4)). The for the crop year                     coverage will not be provided for any acreage:
                  number of acres detennlned above            and that Is                       (1) That does not constitute at least 20 acres or 20
                   for a crop may be Increased by             accepted by us.                         percent of the Insurable crop acreage In the unit,
                  multiplying It by the ratio of the total    The total number                        whichever Is less, and any prevented planting
                  cropland acres that you are fanning         of acres listed may                     acreage within a field that contains planted
                   this year (It greater) to the total        not exceed the
                  cropland acres that you fanned In the runber of acres of                            acreage will be considered to be acreage of the
                                                                                                      same crop, type, and practice that Is planted In
     )            previous year, provided that you            cropland In yoiM'
                  submit proof to us that for the current fanning operation                           the field except that the prevented planting
                  crop year you have ptxehased or             at the time you                         acreage may be considered to be acreage of a
                  leased addltionalland or that acreage submit the                                    crop, type, and practice other than that which is
                  will be released from any USDA              Intended acreage                        planted In the field If:
                  program which protllblls harvest of a report. The nt.mber                           (i) The acreage that was prevented from being
                  crop. Such acreage must have been of acres                                               planted constitutes at least 20 acres or 20
                  purchased, leased, or released from determined above
                  tha USDA program, In time to plant It for a crop may only                                percent of the total Insurable acreage In the
                  for the cutn!flt crop year using good be Increased by                                    field and you produced both crops, crop
                  fanning practices. No cause of loss        multiplying It by the                         types, or followed both practices In the same
                 that would prevent planting may be          ratio of the total                            field In the same crop year within any one of
                 evident at the time you lease the           cropland acres that                           the four most recent crop years; or
                 acreage (except acreage you leesed you are fanning                                  (il) You were prevented from planting a first
                 the previous year and continue to           this year (If                                 insured crop and you planted a second crop
                 lease In the current crop year); you        greater) to the                               In the field (There can only be one first
                 buy the acreage; the acreage Is             number of acres
                 released from a USDA program                                                              Insured crop In a field unless the
                                                             listed on your
                 which prohibits harvest of a crop; you Intended acreage                                   requirements In section 18{f)(1 )(I) or (ill) are
                 request a written agreement to ins!M'e report, Hyou meet                                  met); or
                 the acreage; or you otherwise acquire the conditions                                (iii) The insured crop planted In the field would
                 the acreage (such as lnherHed or            stated In section                             not have been planted on the remaining
                 gifted acreage).                            18(e)(1)(1)(A).                               prevented planting acreage (For example,
    (H)The       (A) The nunber of acres of the crop (B) The number of                                     where rotation requirements would not be
    crop must specified In the processor contract, If acres of the crop                                    met or you already planted the total number
    be           the contract specifies a n~n~ber of         as detennlned In                              of acres specified In the processor contract);
    contracted acres contracted for the crop year; or section                                  {2) For which the actuarial documents do not provide
    with a      the result of dividing the quantity of       18(e)(1 )(IQ(A).                        the Information needed to determine a premium
    processor production stated In the processor
    to be       contract by your approved yield, If the                                              rate unless a written agreement designates such
    Insured     processor contract specifies a                                                      premium rate;
                quantity of production that will be                                            (3) Used for conservation purposes, intended to be
                accepted. If a minimum number of                                                     left unplanted under any program administered
     }          acres or amount of production Is                                                    by the USDA or other government agency, or
                specified In the processor contract.                                                required to be left unharvested under the terms of
I               thls amount will be used to determine                                               the lease or any other agreement (The number of


C 2004 National Crop Insurance Services, Inc.                               Page 18 of26


                                                                       EXHIBIT 4                                                      42
•        ..              acres eligible for prevented planting will be                              (Evidence that you have previously planted th
                         limited to the number of acres specified In the                            crop on the unit will be considered adequat
                         lease for which you are required to pay either                             proof unless your planting practices or rotation;
                        cash or share rent);                                                        requirements show that the acreage would hav
                 (4) On which the Insured crop Is prevented from                                    remained fallow or been planted to another crop;
     )                  being planted, if you or any other person receives                   {1 0) Based on an Irrigated practice Anal Guarante
                        a prevented planting payment for any crop for the                           unless adequate Irrigation facilities were in plac
                        same acreage In the same crop year (It Is your                              to carry out an irrigated practice on the acreag
                        responsibility to determine whether a prevented                             prior to the Insured cause of loss that prevente
                        planting payment had previously been made for                               you from planting. Acreage with an Irrigate
                        the crop year on the acreage for which you are                              practice Final Guarantee will be limited to th
                        now claiming a prevented planting payment and                               number of acres allowed for that practice unde
                        report such information to us before any                                   sections 18(e) and (f);
                        prevented planting payment can be made),                             (11) Based on a crop type that you did not plant, c
                       excluding share arrangements, unless:                                       did not receive a prevented planting insuranc1
                       (I) It Is a practice that Is generally recognized by                        guarantee for, in at least one of the four mo~
                              agricultural    experts or the          organic                      recent crop years. Types for which separat1
                              agricultural Industry In the area to plant the                       Insurance guarantees are available must b•
                              second crop for harvest following harvest of                         included in your approved yield database in a
                              the first Insured crop, and additional                               least one of the four most recent crop years, o
                              coverage insurance offered under the                                 crops that do not require yield certification (crop!
                              authority of the Act is available in the county                      for which the Insurance guarantee Is not baset
                             for both crops in the same crop year;                                 on an approved yield) must be reported on you
                       (II) You provide records acceptable to us of                                acreage report In at least one of the four mos
                             acreage and production that show you have                            recent crop years except as allowed in sectior
                             double cropped acreage In at least two of the                        18(e)(1){1){B). We will limit prevented plantin!
                             last four crop years In which the first insured                      payments based on a specific crop type to thf
                             crop was planted, or that show the                                   number of acres allowed for that crop type a!
                             applicable acreage was double cropped In at                          specified In sections 18(e) and (f); or
                             least two of the last four crop years in which                 (12) If a cause of loss has occurred that woulc
                             the first insured crop was grown on it: and                          prevent planting at the time:
                      (Iii) The amount of acreage you are double                                  (I) You lease the acreage (except acreage yol
                             cropping in the current crop year does not                                 leased the previous crop year and continue
                             exceed the number of acres for which you                                   to lease in the current crop year);
                             provide the records required in section                              (ii) You buy the acreage;
                             18(f)(4)(H);                                                         (iii) The acreage is released from a USDP
                (5) On which the Insured crop is prevented from                                         program which prohibits harvest of a crop;
                      being planted, it                                                           (iv) You request a written agreement to Insure
                      (i) Any crop Is planted within or prior to the late                               the acreage; or
                             planting period or on or prior to the final                          (v) You acquire the acreage through mean~
                            planting date if no late planting period is                                 other than lease or purchase (such a~
                             applicable, unless:                                                        inherited or gifted acreage).
                            (A) You meet the double cropping                           (g) If you purchased an additional coverage policy for a
                                  requirements in section 18(f)(4);                         crop, and you executed a High Risk land Exclusion
                            (B) The crop planted was a cover crop; or                       Option that separately Insures acreage which has
                            (C) No benefit, including any benefit under                     been designated as •high risk" land by FCJC under a
                                  any USDA program, was derived from                        Catastrophic Risk Protection Endorsement for that
                                  the crop; or                                             crop, the maximum number of acres eligible for a
                     (II) Any volunteer or cover crop Is hayed, grazed                     prevented planting payment will be limited for each
                            or otherwise harvested within or prior to the                  policy as specified in sections 18(e) and (f).
                            late planting period or on or prior to the final           (h) If you are prevented from planting a crop for which
                            planting date if no late planting period Is                    you do not have an adequate base of eligible
                            applicable;                                                    prevented planting acreage, as determined in
               (6) For which planting history or conservation plans                        accordance with section 18(e)(1), your prevented
                    Indicate that the acreage would remain faUow for                       planting Final Guarantee, premium, and prevented
                     crop rotation purposes or on which any pasture                        planting payment will be based on the crops Insured
                     or other forage crop Is in place on the acreage                       for the current crop year, for which you have
                     during the time that planting of the Insured crop                     remaining eligible prevented planting acreage. The
                    generally occurs in the area;                                          crops used for this purpose will be those that result In
               (7) That exceeds the number of acres eligible for a                         a prevented planting payment most similar to the
                    prevented planting payment;                                            prevented planting payment that would have been
               (8) That exceeds the number of eligible acres                               made for the crop that was prevented from being
                    physically available for planting;                                     planted.
               (9) For which you cannot provide proof that you had                         (1) For example, assume you were prevented from
                    the inputs available to plant and produce a crop                             planting 200 acres of com and have 100 acres


     '
    ~ 2004
                    with the expectation of at least producing the
                    yield used to determine the Final Guarantee

              National Crop Insurance Services, Inc.                   Page 19 of 26
                                                                                                 eligible for a com prevented planting guarantee
                                                                                                 that would result In a payment of $40 per acre.




                                                                   EXHIBIT 4                                                     43
    ••           You also had 50 acres of potato eligibility that                 accordance with section 20(g). If resolution cannot be
                 would result In a $100 per acre payment, 90                      reached through mediation, or you and we do not
                 acres of grain sorghum eligibility that would result             agree to mediation, the disagreement must be
                In a $30 per acre payment, and 100 acres of                       resolved through arbitration In accordance with the
                soybean eligibiHty that would result In a $25 per                 rules of the American Arbitration Association (AAA),
                acre payment. Your prevented planting coverage                    except as provided In sections 20(c) and (f), and
                for the 200 acres would be based on 100 acres of                  unless rules are established by FCIC for this purpose.
                com ($40 per acre), 90 acres of grain sorghum                     Any mediator or arbitrator with a familial, financial or
                ($30 per acre), and 10 acres of soybeans ($25                     other business relationship to you or us, or our agent
                per acre).                                                        or loss adjuster, Is disqualified from hearing the
           (2) Prevented planting coverage will be allowed as                     dispute.
                specified In this section (18(h)) only If the crop                (1) All disputes Involving determinations made by us,
                that was prevented from being planted meets all                          except those specified In section 20(d), are
               policy provisions, except for having an adequate                          subject to mediation or arbitration. However, If
               base of eligible prevented planting acreage.                             the dispute In any way involves a policy or
               Payment may be made based on crops other                                 procedure Interpretation, regarding whether a
               than those that were prevented from being                                specffic policy provision or procedure Is
               planted even though other policy provisions,                             applicable to the situation, how It Is applicable, or
               Including but not limited to, processor contract                         the meaning of any policy provision or procedure,
               and rotation requirements, have not been met for                         either you or we must obtain an Interpretation
               the crop on which payment Is being based.                                from FCIC In accordance with 7 CFR part 400,
               However, If you were prevented from planting                             subpart X or such other procedures as
               any non-Irrigated crop acreage and you do not                            established by FCIC.
               have any remaining eHgible acreage for that crop                         {I) Any Interpretation by FCIC will be binding in
               and you do not have any other crop remaining                                   any mediation or arbitration.
               with eligible acres under a non-Irrigated practice,                      (II) Failure to obtain any required interpretation
               no prevented planting payment will be made for                                 from FCIC will result in the nullification of any
               the acreage.                                                                   agreement or award.
     (i) The prevented planting payment for any eligible                                (iii) An interpretation by FCIC of a policy
          acreage within a basic or optional unit will be                                     provision is considered a rule of general
          determined by:                                                                      applicability and Is not appealable. If you
          (1) Multiplying the Anal Guarantee for timely planted                               disagree with an Interpretation of a policy
               acreage of the Insured crop by the prevented                                   provision by FCIC, you must obtain a
               planting coverage level percentage you elected,                                Director's review from the National Appeals
               or that Is contained In the Crop Provisions if you                             Division In accordance wfth 7 CFR 11.6
 )             did not elect a prevented planting coverage level                              before     obtaining judicial        review    In
               percentage;                                                                    accordance with subsection.{e);
          (2) Multiplying the result of section 18(1)(1) by the                         (iv) An Interpretation by FCIC of a procedure
               number of eligible prevented planting acres In the                             may be appealed to the National Appeals
               unit; and                                                                      Division in accordance with 7 CFR part 11.
          (3) Multiplying the result of section 18(1)(2) by your                 (2) Unless the dispute Is resolved through mediation,
              share.                                                                   the arbitrator must provide to you and us a
    0) The prevented planting payment for any eligible                                 written statement describing the issues in
         acreage within an enterprise unit will be determined                          dispute, the factual findings, the determinations
         by:                                                                           and the amount and basis for any award and
         (1) Multiplying the Final Guarantee for each basic                            breakdown by claim for any award. The
              unit or optional unit within the enterprise unit, for                    statement must also include any amounts
              timely planted acreage of the insured crop by the                        awarded for interest. Failure of the arbitrator to
              prevented planting coverage level percentage                             provide such written statement will result in the
              you elected, or that is contained in the Crop                            nullification of all determinations of the arbitrator.
              Provisions If you did not elect a prevented                              All agreements reached through settlement,
              planting coverage level percentage;                                      Including those resulting from mediation, must be
         (2) Multiplying the result of section 180)(1) by the                          In writing and contain at a minimum a statement
              number of eligible prevented planting acres in                          of the issues In dispute and the amount of the
              each basic unit or optional unit within the                              settlement.
              enterprise untt;                                               (b) Regardless of whether mediation is elected:
         (3) Multiplying the result of section 18(j)(2) by your                  (1) The initiation of arbitration proceedings must
              share; and                                                              occur within one year of the date we denied your
         (4) Total the results from section 18(j)(3).                                 claim or rendered the determination with which
19. Crops As Payment                                                                  you disagree, whichever Is later;
    You must not abandon any crop to us. We will not accept                      (2) If you fail to initiate arbitration in accordance with
    any crop as compensation for payments due us.                                     section 20(b)(1) and complete the process, you
20. Mediation, Arbitration, Appeal, Reconsideration, and                              will not be able to resolve the dispute through
    Administrative and Judicial Review                                                judicial review;
    (a) If you and we fall to agree on any determination made                    (3) If arbitration has been initiated In accordance with
        by us except those specified in section 20(d), the                            section 20(b)(1) and completed, and judicial
        disagreement may be resolved through mediation In                             review is sought, suit must be filed not later than

C 2004 National Crop Insurance Services, Inc.                   Page20of26


                                                            EXHIBIT 4                                                    44
      ...           one year after the date the arbitration decision              {h) Except as provided in section 20{1), no award o
                    was rendered; and                                                     seHiement in        mediation,    arbitration, appeal
               (4) In any suit, if the dispute in any way involves a                     administrative review or reconsideration process o
                   policy or procedure interpretation, regarding                         judicial review can exceed the amount of liablli~
                    whether a specific policy provision or procedure                     established or which should have been establishec
                   is applicable to the situation, how it is applicable,                 under the policy, except for interest awarded ir
                   or the meaning of any policy provision or                             accordance with section 26.
                   procedure, an interpretation must be obtained                  (I) In a judicial review only, you may recover attomey1
                   from FCIC in accordance with 7 CFR part 400,                          fees or other expenses, or any punitive
                   subpart X or such other procedures as                                 compensatory or any other damages from us only I
                   established by FCIC. Such interpretation will be                      you obtain a detennination from FCIC that we, ou
                   binding.                                                              agent or loss adjuster failed to comply with the tennf
        (c) Any decision rendered in arbitration Is binding on you                       of this policy or procedures issued by FCIC and suet
              and us unless judicial review Is sought in accordance                     failure resulted in you receiving a payment in ar
              with section 20(b)(3). Notwithstanding any provision in                   amount that is less than the amount to which yoL
              the rules of the AAA, you and we have the right to                        were entitled. Requests for such a determinatfor
              judicial review of any decision rendered In arbitration.                  should       be     addressed • to       the    following
        (d) If you do not agree with any determination made by                          USDAIRMA/Deputy Administrator of Compliance/Sto,:
              us or FCIC regarding whether you have used a good                         0806, 1400 Independence Avenue, S.W., Washingtor
              farming practice (excluding determinations by us of                       D.C. 20250-0806.
             the amount of assigned production for uninsured                     0) If FCIC elects to participate ln the adjustment of you1
             causes for your failure to use good farming practices),                    claim, or modifies, revises or corrects your claim, prio1
             you may request ~onslderatlon by FCIC of this                              to payment, you may not bring an arbitration,
             determination in accordance with the reconsideration                       mediation or litigation action against us. You mus1
             process established for this purpose and published at                      request administrative review or appeal in accordance
             7 CFR part 400, subpart J (reconsideration). To                           with section 20(e).
             resolve disputes regarding determinations of the               21. Access to Insured Crop and Records, and Record
             amount of assigned production, you must use the                     Retention
             arbitration or mediation process contained in this                  (a) We, and any employee of USDA authorized to
             section.                                                                  investigate or review any matter relating to crop
             (1) You must complete reconsideration before filing                       insurance, have the right to examine the insured crop
                  suit against FCIC and any such suit must be                          and all records related to the Insured crop and any
                  brought in the United States district court for the                  mediation, arbitration or litigation involving the insured
                  district in which the insured farm is located.                       crop as often as reasonably required during the
  )          (2) Suit must be filed not later than one year after the
                  date of the decision rendered In the
                                                                                       record retention period.
                                                                                (b) You must retain, and provide upon our request, or the
                  reconsideration.                                                     request of any employee of USDA authorized to
            (3) You cannot sue us for determinations of whether                        investigate or review any matter relating to crop
                  good farming practices were used by you.                             insurance:
       (e) Except as provided in section 20(d), if you disagree                        (1) Complete records of the planting, replanting,
            with any other determination made by FCIC, you may                               inputs, production, harvesting, and disposition of
             obtain an administrative review in accordance with 7                            the insured crop on each unit for three years after
            CFR part 400, subpart J (administrative review) or                               the end of the crop year (This requirement also
            appeal in accordance with 7 CFR part 11 (appeal). If                             applies to all such records for acreage that is not
            you elect to bring suit after completion of any appeal,                          Insured); and
            such suit must be filed against FCIC not later than                       (2) All records used to establish the amount of
            one year after the date of the decision rendered in                              production you certified on your production
            such appeal. Under no circumstances can you                                      reports used to compute your approved yield for
            recover any attorney fees or other expenses, or any                              three years after the end of the crop year for
            punitive, compensatory or any other damages from                                 which you initially certified such records, unless
            FCIC.                                                                            such records have already been provided to us
      (f) In any mediation, arbitration, appeal, administrative                              (For example, if your approved yield for the 2003
            review, reconsideration or judicial process, the terms                           crop year was based on production records you
           of this policy, the Act, and the regulations published at                         certified for the 1997 through 2002 crop years,
           7 CFR chapter IV, including the provisions of 7 CFR                               you must retain all such records through the 2006
           part 400, subpart P, are binding. Conflicts between                               crop year, unless such records have already
           this policy and any state or local laws will be resolved                          been provided to us).
           in accordance with section 36. If there are conflicts                (c) We, or any employee of USDA authorized to
           between any rules of the AAA and the provisions of                         investigate or review any matter relating to crop
           your policy, the provisions of your policy will control.                  insurance, may extend the record retention period
      (g) To resolve any dispute through mediation, you and                          beyond three years by notifying you of such extension
           we must both:                                                             in writing.
           (1) Agree to mediate the dispute;                                   (d) By signing the application for insurance authorized
           (2) Agree on a mediator; and                                              under the Act or by continuing insurance for which
 }         (3) Be present or have a designated representative                        you have previously applied, you authorize us or
                 who has authority to settle the case present, at                    USDA, or any person acting for us or USDA
                 the mediation.                                                      authorized to investigate or review any matter relating

C 2004 National Crop Insurance Services, Inc.                      Page21 of26

                                                              EXHIBIT 4                                                    45
•                to crop insurance, to obtain records relating to the                          and the other policy will be void, unless boll
                 planting, replanting, inputs, production, harvesting,                         policies are with:
                 and disposition of the insured crop from any person                           (I) The same Insurance provider and th•
                 who may have custody of such records, Including but                                insurance provider agrees otherwise; or
                 not limited to, FSA offices, banks, warehouses, gins,                         (II) Different insurance providers and boll
     )          cooperatives,        marketing      associations,       and                         Insurance providers agree otherwise.
                accountants. You must assist in obtaining all records               (b) Other Insurance Against Fire - If you have othe
                we or any employee of USDA authorized to                                  insurance, whether valid or not, against damage t<
                Investigate or review any matter relating to crop                        the Insured crop by fire during the Insurance period
                Insurance request from third parties.                                     we will be liable for loss due to fire caused by £
         (e) Failure to provide access to the insured crop or the                         naturally occurring event only for the smaller of:
                farm, authorize access to the records maintained by                      (1) The amount of indemnity determined pursuant tc
                third parties or assist in obtaining such records will                        this policy without regard to such other insurance
                result In a determination that no Indemnity Is due for                        or
                the crop year In which such failure occurred.                            (2) The amount by which the loss from fire If
         (f) Failure to maintain or provide records will result in:                           determined to exceed the indemnity pald 01
                (1) The Imposition of an assigned yield In                                    payable under such other Insurance.
                     accordance with section 4(d)(1) and 7 CFA part                (c) For the purpose of section 22(b), the amount of lo~
                     400, subpart G for those crop years for which you                   from fire will be the reduction In revenue of the
                     do not have the required production records to                      insured crop on the unit involved determined pursuan1
                     support a certified yield;                                          to this policy.
               (2) A determination that no indemnity Is due if you            23. Conformity to Food Security Act
                     fall to provide records necessary to determine                Although your violation of a number of federal statutes,
                     your Joss;                                                    Including the Act, may cause cancellation, termination, or
               (3) Combination of the optional units Into the                      voidance of your Insurance contract, you should be
                     appUcable basic unit;                                         specifically aware that your policy will be canceled if you
               (4) Assignment of production to the units by us If you              are determined to be Ineligible to receive benefits under
                     fail to maintain separate records:                            the Act due to violation of the controlled substance
                     (I) For your basic units; or                                  provision (title XVII of the Food Security Act of 1985 (Pub.
                     {ii) For any uninsurable acreage; and                         L 99-198)) and the regulations promulgated under the Act
               {5) The imposition of consequences specified In                    by USDA. Your Insurance policy will be canceled If you are
                     section 7(g), as applicable.                                 determined, by the appropriate Agency, to be In violation
        {g) If the Imposition of an assigned yield under section                  of these provisions. We wHI recover any and all monies
               21(f)(1) would affect an Indemnity, prevented planting             paid to you or received by you during your period of
              payment or replant payment that was paid In a prior                 Ineligibility, and your premium will be refunded, less a
              crop year, such claim will be adjusted and you will be              reasonable amount for expenses and handling not to
              required to repay any overpaid amounts.                             exceed 20 percent of the premium paid or to be paid by
    22. Other Insurance                                                           you.
        (a) Other Uke Insurance - Nothing In this section                     24. Amounts Due Us
              prevents you from obtaining other Insurance not                     (a) Interest will accrue at the rate of 1.25 percent simple
              authorized under the Act. However, unless specifically                    Interest per calendar month, or any portion thereof, on
              required by policy provisions, you must not obtain any                    any unpaid amount owed to us or on any unpaid
              other crop insurance authorized under the Act on your                     administrative fees owed to FCIC. For the purpose of
              share of the Insured crop. If you cannot demonstrate                      premium amounts owed to us or administrative fees
             that you did not intend to have more than one policy                       owed to FCIC, Interest wm start to accrue on the first
              in effect, you may be subject to the consequences                         day of the month following the premium billing date
             authorized under this policy, the Act, or any other                        specified in the Special Provisions. We will collect any
             applicable statute. If you can demonstrate that you did                    unpaid amounts owed to us and any interest owed
             not intend to have more than one policy in effect (For                     thereon and, prior to the termination date, we will
             example, an application to transfer your policy or                         collect any administrative fees and interest owed
             written notification to an Insurance provider that states                  thereon to FCIC. After the termination date, FCIC will
             you want to purchase, or transfer, Insurance and you                       collect any unpaid administrative fees and any
             want any other policies for the crop canceled would                        interest owed thereon.
             demonstrate you did not intend to have duplicate                     (b) For the purpose of any other amounts due us, such
             policies), and:                                                            as repayment of Indemnities found not to have been
             (1) One Is an additional coverage policy and the                           earned, interest will start to accrue on the date that
                    other is a Catastrophic Risk Protection policy:                     notice Is Issued to you for the collection of the
                    (I) The additional coverage policy will apply if                    uneamed amount. Amounts found due under this
                           both policies are with the same insurance                    paragraph will not be charged Interest if payment Is
                          provider or, if not, both Insurance providers                 made within 30 days of Issuance of the notice by us.
                          agree; or                                                    The amount will be considered delinquent If not paid
                    (ii) The policy with the earliest date of                          within 30 days of the date the notice Is Issued by us.
                          application will be in force if both Insurance          (c) All amounts paid win be applied first to expenses of
                          providers do not agree; or                                   collection (see section 24(d)) if any, second to the
             (2) Both are additional coverage policies or both are                     reduction of accrued interest, and then to the
    )               Catastrophic Risk Protection policies, the policy                  reduction of the principal balance.
                    with the earliest date of application will be In force

    C 2004 National Crop Insurance Services, Inc.                     Page22of26


                                                                 EXHIBIT 4                                                 46
     •• (d)
          If we determine that it Is necessary to contract with a            loss from an insurable cause and fall to file a claim fc
         cotlection agency or to employ an attorney to assist In             indemnity within 60 days after the Harvest Price i
         collection, you agree to pay all of the expenses of                 released, the assignee may submit the claim for indemnit
         collection.                                                         not later than 15 days after the 60-day period has explrec
 ,   (e) The portion of the amounts owed by you for a potlcy                 We will honor the terms of the assignment only if we ca
  I      authorized under the Act that are owed to FCIC may                  accurately determine the amount of the claim. Howeve1
         be collected In part through administrative offset from             no action will lie against us for failure to do so.
         payments you receive from United States government            30. Subrogation (Recovery of Loss From a Third Party)
         agencies In accordance with 31 U.S.C. chapter 37.                   Since you may be able to recover all or a part of your los
         Such amounts Include all administrative fees, and the               from someone other than us, you must do all you can to
         share of the overpaid indemnities and premiums                      preserve this right. If you receive any compensation fc
         retained by FCIC plus any Interest owed thereon.                    your loss, excluding private hail insurance payments an•
 25. [Reserved]                                                             payments covered by section 33, and the Indemnity dut
 26. Interest Umltations                                                     under this policy plus the amount you receive from th•
      We will pay simple Interest computed on the net indemnity             person exceeds the amount of your actual loss, th•
       ultimately found to be due by us or by a final judgment of a         Indemnity will be reduced by the excess amount, or if tht
      court of competent jurisdiction, from and Including the 61 51         Indemnity has already been paid, you will be required It
      day after the date you sign, date, and submit to us the               repay the excess amount, not to exceed the amount of th1
      proper1y completed claim on our form. Interest will be paid           indemnity. The total amount of the actual loss Is tht
      only If the reason for our failure to timely pay Is NOT due           difference between the value of the insured crop befon
      to your failure to provide Information or other material              and after the loss, based on your production records am
      necessary for the computation or payment of the                       the Harvest Price available for the crop. If we pay you fo
      indemnity. The Interest rate will be that established by the          your loss, your right to recovery will, at our option, belen(
      Secretary of the Treasury under section 12 of the Contract            to us. If we recover more than we paid you plus ou
      Disputes Act of 1978 (41 U.S.C. 611) and published In the             expenses, the excess will be paid to you.
      Federal Register semiannually on or about January 1 and          31. Descriptive Headings
      July 1 of each year, and may vary with each publication.             The descriptive headings of the various policy provislom
 27. Concealment. Misrepresentation or Fraud                               are formulated for convenience only and are not intende<
     (a) If you have falsely or fraudulently concealed the fact            to affect the construction or meaning of any of the policl
           that you are Ineligible to receive benefits under the           provisions.
           Act or if you or anyone assisting you has Intentionally     32. Notices
           concealed or misrepresented any material fact                   (a) All notices required to be given by you must be ir
           relating to this policy:                                             writing and received by your crop insurance agen
           (1) This policy will be voided; and                                  within the designated time unless otherwise providec
 j         (2) You may be subject to remedial sanctions In                      by the notice requirement. Notices required to be
                accordance with 7 CFR part 400, subpart R.                      given immediately may be by telephone or in persor
      (b) Even though the policy is void, you may still be                     and confirmed In writing. Time of the notice will be
           required to pay 20 percent of the premium due under                 determined by the time of our receipt of the writter
          the policy to offset costs incurred by us in the service             notice. If the date by which you are required to submi~
          of this policy. If previously paid, the balance of the               a report or notice falls on Saturday, Sunday, or e
          premium will be returned.                                            Federal holiday, or, if your agent's office is, for an}
      (c) Voidance of this policy will result in you having to                 reason, not open for business on the date you are
          reimburse all indemnities paid for the crop year In                  required to submit such notice or report, such notice
          which the voidance was effective.                                    or report must be submitted on the next business day.
      (d) Voidance will be effective on the first day of the               (b) All notices and communications required to be sent b~
          insurance period for the crop year in which the act                  us to you will be mailed to the address contained in
          occurred and will not affect the policy for subsequent               your records located with your crop insurance agent.
          crop years unless a violation of this section also                   Notice sent to such address will be conclusively
          occurred In such crop years.                                         presumed to have been received by you. You should
28. Transfer of Coverage and Right to Indemnity                                advise us immediately of any change of address.
      If you transfer any part of your share during the crop year,     33. Multrple Benefits
      you may transfer your coverage rights, If the transferee Is           (a) If you are eligible to receive an indemnity under an
      eligible for crop insurance. We will not be liable for any                additional coverage plan of insurance and are also
     more than the liability determined in accordance with your                 eligible to receive benefits for the same loss under
     policy that existed before the transfer occurred. The                      any other USDA program, you may receive benefits
     transfer of coverage rights must be on our form and will                   under both programs, unless specifically limited by
     not be effective until approved by us in writing. Both you                 the crop Insurance contract or by law.
     and the transferee are jointly and severally liable for the            (b) The total amount received from all such sources may
     payment of the premium and administrative fees. The                        not exceed the amount of your actual loss. The total
     transferee has all rights and responslbflities under this                  amount of the actual loss is the difference between
     policy consistent with the transferee's Interest.                          the fair market value of the Insured commodity before
29. Assignment of Indemnity                                                     and after the loss, based on your production records
     You may assign to another party your right to an indemnity                 and the Harvest Price available for the crop.
     for the crop year. The assignment must be on our form                  (c) FSA will determine and pay the additional amount due
     and will not be effective until approved in writing by us.                 you for any applicable USDA program, after first
     The assignee wfll have the right to submit all loss notices                considering the amount of any crop insurance
     and forms as required by the policy. If you have suffered a                Indemnity.


C 2004 National Crop Insurance Services, Inc.                 Page23 of26


                                                          EXHIBIT 4                                                 47
•    34.' Written Agreements                                                                      (A) Insure unrated land, or an unratec
          Terms of this policy which are specifically designated for                                   practice, type or variety of a crop (fa
          the use of written agreements may be altered by written                                      which that practice, type, or variety o
          agreement in accordance with the following:                                                 the crop Is insured under CAC for thit
          (a) You must apply in writing for each written agreement                                    crop year) and such written agreement!
                no later than the sales closing date, except as                                       may be approved only after inspectior
                provided In section 34(f);                                                            of the acreage by us and the writter
          (b) The application for a written agreement must contain                                    agreement may only be approved b~
                all variable terms of the contract between you and us                                 FCIC if the crop's potential is equal to o
               that will be In effect If the written agreement Is not                                 exceeds 90 percent of the yield used tc
                approved.                                                                             determine the Anal Guarantee and yoL
         (c) A written agreement may only be used to Insure a                                         sign the agreement on the same day the
               CRC crop In a county without a CAC program If the                                      appraisal is made; or
               county without a CRC program Is adjacent to a county                              (B) Establish optional units In accordance
               with a CRC program;                                                                    with FCIC procedures that otherwise
         (d) If approved by FCIC, the written agreement will                                          would not be allowed, change the
               Include all terms of the contract, Including, but not                                  premium rate or transitional yield for
               limited to, crop practice, type or variety, the guarantee                              designated high risk land, or Insure
               (except for a written agreement In effect for more than                                acreage that Is greater than 5 percent of
              one year) and premium rate or lnfonnatlon needed to                                     the planted acreage In the unit where
              detennlne the guarantee and premium rate;                                               the acreage has not been planted and
         (e) Each written agreement will only be valid for the                                        harvested or Insured in any of the three
              number of crop years specffied in the written                                           previous crop years; or
              agreement and a multi-year written agreement:                               (li) On or before the cancellation date, to Insure
              (1) Will only apply for any particular crop year                                  a crop in a county that does not have
                      designated In the written agreement If all terms                          actuarial documents for the crop (If the Crop
                      and conditions In the written agreement are still                         Provisions do not provide a cancellation date
                      applicable for the crop year and the conditions                           for the county, the cancellation date for other
                      under which the written agreement has been                                Insurable crops In the same state that have
                     provided have not changed prior to the beginning                           similar final planting and harvesting dates
                      of the insurance period (If conditions change                             will be applicable); or
                      during or prior to the crop year, the written                       (UI) On or before the date specified In the Crop
                      agreement will not be effective for that crop year                        Provisions or Special Provisions;
                     but may still be effective for a subsequent crop                (3) On or before the sales closing date, for all
                     year if conditions under which the written                           requests for renewal of written agreements,
                     agreement has been provided exist for such                          except as provided In section 34(f)(1);
                     year);                                                          (4) To add land or a crop to an existing written
              (2) May be canceled In writing by:                                         agreement or to add land or a crop to a request
                     (i) FCIC not less than 30 days before the                            for a written agreement provided the request is
                          cancellation date if it discovers that any tenn                submitted by the deadlines specified In this
                          or condition of the written agreement.                         subsection;
                          including the premium rate, is not                     (g) A request for a written agreement must contain:
                          appropriate for the crop; or                               (1) For an written agreement requests:
                     (ii) You or us on or before the cancellation date;                  (I) A completed "Request for Actuarial Change•
             (3) That is not renewed in writing after it expires, Is                           form;
                     not applicable for a crop year, or is canceled,                     (li) An APH form(except for policies that do not
                     then Insurance coverage will be in accordance                             require APH) containing all the Information
                     with the terms and conditions stated in this policy,                      needed to determine the approved yield for
                     without regard to the written agreement; and                              the current crop year (completed APH form),
             (4) Will be automaticaly cancelled If you transfer                                signed by you, or an unsigned, completed
                     your policy to another Insurance provider (No                             APH form with the applicable production
                     notice will be provided to you and for any                                reports signed and dated by you that are
                     subsequent crop year, for a written agreement to                          based on verifiable records of actual yields
                    be effective, you must timely request renewal of                           for the crop and county for which the written
                    the written agreement In accordance with this                              agreement Is being requested (the actual
                    section);                                                                  yields do not necessarily have to be from the
        (f) A request for a written agreement may be submitted:                                same physical acreage for which you are
             (1) After the sales closing date, but on or before the                            requesting a written ·agreement) for at least
                    acreage reporting date, if you demonstrate your                            the most recent crop year during the base
                    physical inability to submit the request prior to the                      period and verifiable records of actual yields
                    sales closing date (For example, you have been                             If required by FCIC;
                    hospitalized or a blizzard has made It impossible                    (iii) The legal description of the land (In areas
                    to submit the written agreement request In                                 where legal descriptions are available), FSA
                    person or by mall);                                                        Farm Serial Number Including tract number,
             (2) For the first year the written agreement will be In                           and a FSA aerial photograph, acceptable
                    effect only:                                                               Geographic Information System or Global
                    (I) On or before the acreage reporting date, to:                           Positioning System maps or other leglble


    C 2004 National Crop Insurance Services, Inc.                   Page24of26


                                                                EXHIBIT 4                                                  48
                             maps delineating field boundaries where you                 (2) The original written agreement Is signed by yoJ
                             Intend to plant the crop for which Insurance                      and sent to us not later than the expiration date
                            is requested; and                                                  and
                      (lv) All other lnfonnatlon that supports your                      (3) The crop meets the minimum appraisal amour
                            request for a written agreement (Including                         specified in section 34(f)(2)(i)(A), if applicable;
  )                         but not limited to records pertaining to              (k) Multiyear written agreements may be canceled Brll
                            levees, drainage systems, flood frequency                    requests for renewal may be rejected if the severity o
                            data, soil types, elevation, etc.);                         frequency of your loss experience under the writte1
               {2) For written agreement requests for counties                          agreement Is significantly worse than expected basec
                     without actuarial documents for the crop, the                      on the Information provided by you or used tc
                     requirements In section 34(g)(1) (except section                   establish your premium rate and the loss experienc1
                     34(g)( 1){II)) and:                                                of other crops with similar risks In the area;
                     (I) A completed APH form (except for policies                (/) With respect to your and our abflity to reject an offe
                            that do not require APH) based on verifiable                for a written agreement:
                           records of actual yields for the crop and                    (1) When a single Request for Actuarial ChangE
                           county for which the written agreement is                          form Is submitted, regardless of how man!
                           being requested (the actual yields do not                          requests for changes are contained on the form
                           necessarily have to be from the same                               you and we can only accept or reject the writter
                           physical acreage for which you are                                 agreement In Its entirety (you cannot rejec
                           requesting a written agreement) for at least                       specific terms of the written agreement anc
                           the most recent three consecutive crop years                       accept others);
                           during the base period;                                      (2) When multiple Request for Actuarial ChangE
                    (H) Acceptable production records for at least                            forms are submitted, regardless of when thE
                           the most recent three consecutive crop                            forms are submitted, for the same condition or fo1
                           years;                                                            the same crop (I.e., to Insure com on ten lega
                    (iii) The dates you and other growers in the area                         descriptions where there are no actuarfa
                          normally plant and harvest the crop, if                            documents In the county or the request is tc
                           applicable;                                                       change the premium rates from the high ris~
                    (iv) The name, location of, and approximate                              rates) all these forms may be treated as one
                          distance to the place the crop will be sold or                     request and you and we will only have the option
                          used by you;                                                       of accepting or rejecting the written agreement In
                    (v) For any Irrigated practice, the water source,                        Its entirety (you cannot reject specific terms of the
                          method of irrigation, and the amount of water                      written agreement and accept others);
                          needed for an irrigated practice for the crop;               (3) When multiple Request for Actuarial Change
                          and                                                                forms are submitted, regardless of when the
                    (vi) All other information that supports your                            forms are submitted, for the different conditions
                          request for a written agreement (such as                           or for different crops, separate agreements may
                          pubHcations regarding yields, practices,                           be issued and you and we will have the option to
                          risks, climatic data, etc.); and                                   accept or reject each written agreement and
             (3) Such other fnfonnatlon as specified In the Special                    (4) If we reject an offer for a written agreement
                    Provisions or required by FCIC;                                          approved by FCIC, you may seek arbitration or
       (h) A request for a written agreement will not be accepted                           mediation of our decision to reject the offer in
             if:                                                                             accordance with section 20;
             (1) The request is submitted to us after the deadline               (m) Any Information that is submitted by you after the
                   contained In sections 34(a) or (f);                                 applicable deadlines In sections 34(a) and (f) will not
            (2) All the information required in section 34(g) Is not                   be considered, unless such Information is specifically
                   submitted to us with the request for a written                      requested in accordance with section 34(g)(3);
                   agreement (The request for a written agreement                (n) If the written agreement or the policy is canceled for
                   may be accepted if any missing Information Is                       any reason, or the period for which an existing written
                   available from other acceptable sources): or                        agreement Is In effect ends, a request for renewal of
            (3) The request Is to add land to an existing written                     the written agreement must contain all the lnfonnation
                   agreement or to add land to a request for a                         required by this section and be submitted In
                  written agreement and the request to add the                        accordance with section 34(f}, unless otherwise
                   land Is not submitted by the deadlines specified                   specified by FCIC; and
                  In sections 34{a) or (f).                                      (o) If a request for a written agreement Is not approved
      (I) A request for a written agreement will be denied if:                        by FCIC, a request for a written agreement for any
            (1) FCIC determines the risk Is excessive;                                subsequent crop year that fails to address the stated
           (2) Your APH history demonstrates you have not                             basis for the denial win not be accepted (If the request
                  produced at least 50 percent of the transitional                    for a written agreement contains the same infonnation
                  yield for the crop, type, and practice obtained                     that was previously rejected or denied, you will not
                  from an adjacent county with similar agronomic                      have any right to arbitrate, mediate or appeal the non-
                  conditions and risk exposure;                                       acceptance of your request).
           (3) Agricultural experts or the organic agricultural              35. Substitution of Yields
                  Industry determines the crop is not adapted to the             (a) When you have actual yields in your production
                  county;                                                             history database that, due to an insurable cause of
      0) A written agreement will be denied unless:                                   loss, are less than 60 percent of the applicable
           (1) FCIC approves the written agreement;                                  transitional yield (T-yield) you may elect, on an


C 2004 National Crop Insurance Services, Inc.                       Page25 of26

                                                               EXHIBIT 4                                                    49
•        ••     Individual actual yield basis, to exclude and replace             (c) On the date you report your acreage, you must have:
                one or more of any such yields within each database.                    (1) For certified organic acreage, a writter
          (b) Each election made in section 35{a) must be made on                            certification in effect from a certifying agen~
                or before the production reporting date for the Insured                     Indicating the name of the entity certified
                crop and each such election will remain in effect for                       effective date of certification, certificate number,
               succeeding years unless cancelled by the production                          types of commodities certified, and name and
               reporting date for the succeeding crop year. If you                          address of the certifying agent (A certificate
               cancel an election, the actual yield will be used in the                     Issued to a tenant may be used to qualify a
               database. For example, If you elected to substitute                          landlord or other similar arrangement);
               yields In your database for the 1998 and 2000 crop                       (2) For transitional acreage, a certificate as
               year, for any subsequent crop year, you can elect to                         described In section 37(c)(1), or written
               cancel the substitution for either or both years.                            documentation from a certifying agent Indicating
         (c) Each excluded actual yield will be replaced with a                             an organic plan is In effect for the acreage; and
               yield equal to 60 percent of the applicable T -yield for                (3) Records from the certifying agent showing the
               the crop year in which the yield Is being replaced (For                      specific location of each field of certified organic,
               example, if you elect to exclude a 2001 crop year                            transitional, buffer zone, and acreage not
               actual yield, the T-yleld in effect for the 2001 crop                        maintained under organic management
               year in the county will be used. If you also elect to             (d) If you claim a loss on any acreage insured under an
              exclude a 2002 crop year actual yield, the T-yield In                    organic farming practice, you must provide us with
              effect for the 2002 crop year in the county will be                      copies of the records required In section 37(c).
              used). The replacement yields wiU be used in the                   (e) If any acreage qualifies as certified organic or
              same manner as actual yields for the purpose of                          transitional acreage on the date you report such
              calculating the approved yield.                                          acreage, and such certification Is subsequently
         (d) Once you have elected to exclude an actual yield                          revoked by the certifying agent, or the certifying agent
              from the database, the replacement yield will remain                     no longer considers the acreage as transitional
              In effect until such time as that crop year Is no longer                 acreage for the remainder of the crop year, that
              included In the database unless this election Is                         acreage will remain Insured under the reported
              cancelled In accordance with section 35(b).                              practice for which it quaUfled at the time the acreage
        (e) Although your approved yield will be used to                              was reported. Any loss due to failure to comply with
              determine your amount of premium owed, the                               organic standards will be considered an uninsured
              premium rate will be increased to cover the additional                  cause of loss.
              risk associated with the substitution of higher yields.            (f) Contamination by application or drift of prohibited
    36. Applicability of State and Local Statutes                                      substances onto land on which crops are grown using
        If the provisions of this policy conflict with statutes of the                organic farming practices will not be an Insured peril
        State or locality In which this policy is Issued, the policy                  on any certified organic, transitional or buffer zone
        provisions will prevaiL State and local laws and regulations                  acreage.
        in conflict with federal statutes, this policy, and the                  (g) In addition to the provisions contained in section 18(f),
        applicable regulations do not apply to this policy.                           prevented planting coverage will not be provided for
    37. Organic Fanning Practices                                                     any acreage based on an organic farming practice In
        (a) In accordance with section 9(b)(2), Insurance will not                    excess of the number of acres that will be grown
             be provided for any crop grown using an organic                          under an organic farming practice and shown as such
             farming practice, unless the Information needed to                       In the records required In section 37(c).
             determine a premium rate for an organic farming                     (h) In lieu of the provisions contained in section 18(f){1)
             practice is specified on the actuarial table, or                         that specify prevented planting acreage within a field
             insurance Is allowed by a written agreement.                             that contains planted acreage will be considered to be
        (b) If Insurance is provided for an organic farming                           acreage of the same practice that is planted In the
             practice as specified in section 37(a), only the                         field, prevented planting acreage will be considered
             following acreage will be insured under such practice:                   as organic practice acreage if it Is Identified as
             (1) Certified organic acreage;                                           certified organic, transitional, or buffer zone acreage
             (2) Transitional acreage being converted to certified                    In the organic plan.
                    organic acreage In accordance with an organic
                    plan; and
             (3) Buffer zone acreage.




     )

    It> 2004 National Crop Insurance Services, Inc.                Page26 of26


                                                              EXHIBIT 4                                                     50
|   | Positive
As of: June 4, 2015 4:28 PM EDT

                                             9 USCS § 10
                              Current through PL 114-13, approved 5/19/15

United States Code Service - Titles 1 through 54       >   TITLE 9. ARBITRATION          >   CHAPTER 1.
GENERAL PROVISIONS

§ 10. Same; vacation; grounds; rehearing
    (a) In any of the following cases the United States court in and for the district wherein the award
        was made may make an order vacating the award upon the application of any party to the
        arbitration--
        (1) where the award was procured by corruption, fraud, or undue means;
        (2) where there was evident partiality or corruption in the arbitrators, or either of them;
        (3) where the arbitrators were guilty of misconduct in refusing to postpone the hearing, upon
            sufficient cause shown, or in refusing to hear evidence pertinent and material to the
            controversy; or of any other misbehavior by which the rights of any party have been
            prejudiced; or
        (4) where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual,
            final, and definite award upon the subject matter submitted was not made.
    (b) If an award is vacated and the time within which the agreement required the award to be made
        has not expired, the court may, in its discretion, direct a rehearing by the arbitrators.
    (c) The United States district court for the district wherein an award was made that was issued
        pursuant to section 580 of title 5 may make an order vacating the award upon the application
        of a person, other than a party to the arbitration, who is adversely affected or aggrieved by the
        award, if the use of arbitration or the award is clearly inconsistent with the factors set forth in
        section 572 of title 5.

History

  (July 30, 1947, ch 392, § 1,61 Stat. 672; Nov. 15, 1990, P.L. 101-552, § 5, 104 Stat. 2745; Aug. 26,
1992, P.L. 102-354, § 5(b)(4), 106 Stat. 946; May 7, 2002, P.L. 107-169, § 1, 116 Stat. 132.)

Prior law and revision:
  This section is based on Act Feb. 12, 1925, ch 213, § 10, 43 Stat. 885 (§ 10 of former Title 9).




                                               EXHIBIT 5
|   | Neutral
As of: June 4, 2015 4:31 PM EDT

                                Tex. Bus. & Com. Code § 17.42
                    This document is current through the 2013 3rd Called Session

Texas Statutes and Codes > BUSINESS AND COMMERCE CODE > TITLE 2. COMPETITION AND
TRADE PRACTICES > CHAPTER 17. DECEPTIVE TRADE PRACTICES > SUBCHAPTER E.
DECEPTIVE TRADE PRACTICES AND CONSUMER PROTECTION

§ 17.42. Waivers: Public Policy
    (a) Any waiver by a consumer of the provisions of this subchapter is contrary to public policy and
        is unenforceable and void; provided, however, that a waiver is valid and enforceable if:
        (1) the waiver is in writing and is signed by the consumer;
        (2) the consumer is not in a significantly disparate bargaining position; and
        (3) the consumer is represented by legal counsel in seeking or acquiring the goods or services.
    (b) A waiver under Subsection (a) is not effective if the consumer’s legal counsel was directly or
        indirectly identified, suggested, or selected by a defendant or an agent of the defendant.
    (c) A waiver under this section must be:
        (1) conspicuous and in bold-face type of at least 10 points in size;
        (2) identified by the heading ″Waiver of Consumer Rights,″ or words of similar meaning; and
        (3) in substantially the following form:
              ″I waive my rights under the Deceptive Trade Practices-Consumer Protection Act, Section
            17.41 et seq., Business & Commerce Code, a law that gives consumers special rights and
            protections. After consultation with an attorney of my own selection, I voluntarily consent
            to this waiver.″
    (d) The waiver required by Subsection (c) may be modified to waive only specified rights under
        this subchapter.
    (e) The fact that a consumer has signed a waiver under this section is not a defense to an action
        brought by the attorney general under Section 17.47.

History

Enacted by Acts 1973, 63rd Leg., ch. 143 (H.B. 417), § 1, effective May 21, 1973; am. Acts 1981, 67th
Leg., ch. 307 (S.B. 619), § 1, effective August 31, 1981; am. Acts 1983, 68th Leg., ch. 883 (H.B. 1438),
§ 1, effective August 29, 1983; am. Acts 1987, 70th Leg., ch. 167 (S.B. 892), § 5.02(6), effective
September 1, 1987; am. Acts 1989, 71st Leg., ch. 380 (S.B. 437), § 1, effective September 1, 1989; am.
Acts 1995, 74th Leg., ch. 414 (H.B. 668), § 1, effective September 1, 1995.



                                             EXHIBIT 6
|   | Positive
As of: June 4, 2015 4:31 PM EDT

                               Tex. Bus. & Com. Code § 17.565
                   This document is current through the 2013 3rd Called Session

Texas Statutes and Codes > BUSINESS AND COMMERCE CODE > TITLE 2. COMPETITION AND
TRADE PRACTICES > CHAPTER 17. DECEPTIVE TRADE PRACTICES > SUBCHAPTER E.
DECEPTIVE TRADE PRACTICES AND CONSUMER PROTECTION

§ 17.565. Limitation

All actions brought under this subchapter must be commenced within two years after the date on which
the false, misleading, or deceptive act or practice occurred or within two years after the consumer
discovered or in the exercise of reasonable diligence should have discovered the occurrence of the
false, misleading, or deceptive act or practice. The period of limitation provided in this section may be
extended for a period of 180 days if the plaintiff proves that failure timely to commence the action was
caused by the defendant’s knowingly engaging in conduct solely calculated to induce the plaintiff to
refrain from or postpone the commencement of the action.

History

Enacted by Acts 1979, 66th Leg., ch. 603 (S.B. 357), § 8, effective August 27, 1979; am. Acts 1987,
70th Leg., ch. 167 (S.B. 892), § 5.02(7), effective September 1, 1987 (renumbered from Sec. 17.56A).

Annotations

Case Notes

 Antitrust & Trade Law: Consumer Protection: General Overview
 Antitrust & Trade Law: Consumer Protection: Deceptive Acts & Practices: General Overview
 Antitrust & Trade Law: Consumer Protection: Deceptive Acts & Practices: State Regulation
 Antitrust & Trade Law: Consumer Protection: Deceptive Labeling & Packaging: State Regulation
 Antitrust & Trade Law: State Civil Action
 Antitrust & Trade Law: Trade Practices & Unfair Competition: General Overview
 Antitrust & Trade Law: Trade Practices & Unfair Competition: State Regulation: Claims
 Banking Law: Consumer Protection: State Law: General Overview
 Civil Procedure: Pleading & Practice: Defenses, Demurrers & Objections: Affirmative Defenses:
General Overview
 Civil Procedure: Pleading & Practice: Defenses, Demurrers & Objections: Affirmative Defenses:
Statutes of Limitations: General Overview
 Civil Procedure: Pleading & Practice: Pleadings: Amended Pleadings: General Overview
 Civil Procedure: Pleading & Practice: Pleadings: Amended Pleadings: Relation Back
 Civil Procedure: Pleading & Practice: Pleadings: Time Limitations: General Overview
 Civil Procedure: Summary Judgment: General Overview
 Civil Procedure: Summary Judgment: Burdens of Production & Proof: General Overview

                                              EXHIBIT 7
|    | Positive
As of: June 4, 2015 4:32 PM EDT

                               Tex. Civ. Prac. & Rem. Code § 16.003
                      This document is current through the 2013 3rd Called Session

Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL,
JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 16. LIMITATIONS >
SUBCHAPTER A. LIMITATIONS OF PERSONAL ACTIONS

§ 16.003. Two-Year Limitations Period
     (a) Except as provided by Sections 16.010, 16.0031, and 16.0045, a person must bring suit for
         trespass for injury to the estate or to the property of another, conversion of personal property,
         taking or detaining the personal property of another, personal injury, forcible entry and detainer,
         and forcible detainer not later than two years after the day the cause of action accrues.
     (b) A person must bring suit not later than two years after the day the cause of action accrues in
         an action for injury resulting in death. The cause of action accrues on the death of the injured
         person.

History

Enacted by Acts 1985, 69th Leg., ch. 959 (S.B. 797), § 1, effective September 1, 1985; am. Acts 1995,
74th Leg., ch. 739 (H.B. 2330), § 2, effective June 15, 1995; am. Acts 1997, 75th Leg., ch. 26 (H.B.
368), § 2, effective May 1, 1997; am. Acts 2005, 79th Leg., ch. 97 (S.B. 15), § 3, effective September
1, 2005.

Annotations

Notes
Legislative Note. --
 * See Texas Litigation Guide, Ch. 72, Limitation of Actions.

Editor’s Notes. --

  Acts 2005, 79th Leg., ch. 97 (S.B. 15), § 10 provides: ″There is a direct appeal to the supreme court
from an order, however characterized, of a trial court granting or denying a temporary or otherwise
interlocutory injunction or a permanent injunction on the grounds of the constitutionality or
unconstitutionality, or other validity or invalidity, under the state or federal constitution of all or any
part of this Act. The direct appeal is an accelerated appeal.″
  2005 amendment,
  added ″16.0031″ in (a).

Case Notes

    Banking Law: Consumer Protection: Fair Debt Collection: Unfair Practices
    Bankruptcy Law: Case Administration: Examiners, Officers & Trustees: General Overview

                                                EXHIBIT 8
|    | Positive
As of: June 4, 2015 4:34 PM EDT

                              Tex. Civ. Prac. & Rem. Code § 16.070
                      This document is current through the 2013 3rd Called Session

Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 2. TRIAL,
JUDGMENT, AND APPEAL > SUBTITLE B. TRIAL MATTERS > CHAPTER 16. LIMITATIONS >
SUBCHAPTER D. MISCELLANEOUS PROVISIONS

§ 16.070. Contractual Limitations Period
     (a) Except as provided by Subsection (b), a person may not enter a stipulation, contract, or
         agreement that purports to limit the time in which to bring suit on the stipulation, contract, or
         agreement to a period shorter than two years. A stipulation, contract, or agreement that
         establishes a limitations period that is shorter than two years is void in this state.
     (b) This section does not apply to a stipulation, contract, or agreement relating to the sale or
        purchase of a business entity if a party to the stipulation, contract, or agreement pays or receives
        or is obligated to pay or entitled to receive consideration under the stipulation, contract, or
        agreement having an aggregate value of not less than $ 500,000.

History

Enacted by Acts 1985, 69th Leg., ch. 959 (S.B. 797), § 1, effective September 1, 1985; am. Acts 1991,
72nd Leg., ch. 840 (S.B. 935), § 2, effective August 26, 1991.

Annotations

Notes
1991 Note:
 The amendments made by Acts 1991, 72nd Leg., ch. 840 apply to a stipulation, contract, or agreement
entered into before, on, or after August 26, 1991. Acts 1991, 72nd Leg., ch. 840, § 5.
 * See Texas Litigation Guide, Ch. 72, Limitation of Actions.

Case Notes

    Civil Procedure: Federal & State Interrelationships: Choice of Law: General Overview
    Civil Procedure: Federal & State Interrelationships: Federal Common Law: General Overview
    Contracts Law: Breach: Causes of Action: General Overview
    Contracts Law: Contract Conditions & Provisions: Conditions Precedent
    Contracts Law: Defenses: Statutes of Limitations
    Governments: Legislation: Statutes of Limitations: General Overview
    Governments: Legislation: Statutes of Limitations: Time Limitations
    Governments: Legislation: Statutes of Limitations: Waivers
    Insurance Law: Claims & Contracts: Policy Interpretation: General Overview

                                                EXHIBIT 9
|     | Positive
As of: June 4, 2015 4:35 PM EDT

                              Tex. Civ. Prac. & Rem. Code § 171.021
                      This document is current through the 2013 3rd Called Session

Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 7. ALTERNATE
METHODS OF DISPUTE RESOLUTION > CHAPTER 171. GENERAL ARBITRATION >
SUBCHAPTER B. PROCEEDINGS TO COMPEL OR STAY ARBITRATIONS

§ 171.021. Proceeding to Compel Arbitration
     (a) A court shall order the parties to arbitrate on application of a party showing:
          (1) an agreement to arbitrate; and
          (2) the opposing party’s refusal to arbitrate.
     (b) If a party opposing an application made under Subsection (a) denies the existence of the
        agreement, the court shall summarily determine that issue. The court shall order the arbitration
        if it finds for the party that made the application. If the court does not find for that party, the
        court shall deny the application.
     (c) An order compelling arbitration must include a stay of any proceeding subject to Section
         171.025.

History

Enacted by Acts 1997, 75th Leg., ch. 165 (S.B. 898), § 5.01, effective September 1, 1997.

Annotations

Notes

Editor’s Notes. --

 For information regarding the reorganization of former Chapter 171, see the editor’s notes following
Tex. Civ. Prac. & Rem. Code § 171.001.

Case Notes

    Business & Corporate Law: Corporations: Finance: Franchise Tax: Penalties for Noncompliance
    Civil Procedure: Pleading & Practice: Defenses, Demurrers & Objections: Motions to Dismiss
    Civil Procedure: Discovery: Methods: General Overview
    Civil Procedure: Summary Judgment: Motions for Summary Judgment: General Overview
    Civil Procedure: Alternative Dispute Resolution: General Overview
    Civil Procedure: Alternative Dispute Resolution: Arbitrations: General Overview
    Civil Procedure: Alternative Dispute Resolution: Arbitrations: Arbitrability
    Civil Procedure: Alternative Dispute Resolution: Arbitrations: Federal Arbitration Act: General

                                                EXHIBIT 10
|   | Positive
As of: June 4, 2015 4:35 PM EDT

                               Tex. Civ. Prac. & Rem. Code § 171.088
                     This document is current through the 2013 3rd Called Session

Texas Statutes and Codes > CIVIL PRACTICE AND REMEDIES CODE > TITLE 7. ALTERNATE
METHODS OF DISPUTE RESOLUTION                      >   CHAPTER 171. GENERAL ARBITRATION                >
SUBCHAPTER D. COURT PROCEEDINGS

§ 171.088. Vacating Award
    (a) On application of a party, the court shall vacate an award if:
        (1) the award was obtained by corruption, fraud, or other undue means;
        (2) the rights of a party were prejudiced by:
             (A) evident partiality by an arbitrator appointed as a neutral arbitrator;
             (B) corruption in an arbitrator; or
             (C) misconduct or wilful misbehavior of an arbitrator;
        (3) the arbitrators:
             (A) exceeded their powers;
             (B) refused to postpone the hearing after a showing of sufficient cause for the postponement;
             (C) refused to hear evidence material to the controversy; or
             (D) conducted the hearing, contrary to Section 171.043, 171.044, 171.045, 171.046, or
                 171.047, in a manner that substantially prejudiced the rights of a party; or
        (4) there was no agreement to arbitrate, the issue was not adversely determined in a proceeding
            under Subchapter B, and the party did not participate in the arbitration hearing without
            raising the objection.
    (b) A party must make an application under this section not later than the 90th day after the date
        of delivery of a copy of the award to the applicant. A party must make an application under
        Subsection (a)(1) not later than the 90th day after the date the grounds for the application are
        known or should have been known.
    (c) If the application to vacate is denied and a motion to modify or correct the award is not pending,
        the court shall confirm the award.

History

Enacted by Acts 1997, 75th Leg., ch. 165 (S.B. 898), § 5.01, effective September 1, 1997.




                                               EXHIBIT 11
                                      Tex. Const. Art. I, § 13
This document is current through the 2015 regular session, 84th Legislature, S.B. 293 (chapter 2).

Texas Constitution > CONSTITUTION OF THE STATE OF TEXAS 1876 > ARTICLE I. BILL OF
RIGHTS

§ 13. Excessive Bail or Fines; Cruel and Unusual Punishment; Remedy by Due
Course of Law.

Excessive bail shall not be required, nor excessive fines imposed, nor cruel or unusual punishment
inflicted. All courts shall be open, and every person for an injury done him, in his lands, goods, person
or reputation, shall have remedy by due course of law.

Annotations

Case Notes

 OPINIONS OF ATTORNEY GENERAL
 Administrative Law: Judicial Review: Reviewability: Jurisdiction & Venue
 Business & Corporate Law: Corporations: Dissolution & Receivership: Termination & Winding Up:
Limited Survival
 Business & Corporate Law: Corporations: Shareholders: Actions Against Corporations: Derivative
Actions: General Overview
 Civil Procedure: Justiciability: General Overview
 Civil Procedure: Justiciability: Case or Controversy Requirements: Immediacy
 Civil Procedure: Justiciability: Standing: General Overview
 Civil Procedure: Justiciability: Standing: Burdens of Proof
 Civil Procedure: Justiciability: Standing: Injury in Fact
 Civil Procedure: Jurisdiction: General Overview
 Civil Procedure: Jurisdiction: Subject Matter Jurisdiction: Jurisdiction Over Actions: General
Overview
 Civil Procedure: Jurisdiction: Subject Matter Jurisdiction: Jurisdiction Over Actions: Concurrent
Jurisdiction
 Civil Procedure: Equity: General Overview
 Civil Procedure: Removal: Proceedings: Fraudulent Joinder
 Civil Procedure: Federal & State Interrelationships: Abstention
 Civil Procedure: Pleading & Practice: Pleadings: Amended Pleadings: General Overview
 Civil Procedure: Pleading & Practice: Pleadings: Proceedings in Forma Pauperis: Prisoners: Petitions
 Civil Procedure: Parties: Capacity of Parties: General Overview
 Civil Procedure: Parties: Prisoners: Dismissals of Petitions
 Civil Procedure: Parties: Prisoners: Screening of Petitions
 Civil Procedure: Joinder of Claims & Remedies: General Overview
 Civil Procedure: Judicial Officers: Judges: Discretion
 Civil Procedure: Dismissals: Involuntary Dismissals: General Overview
 Civil Procedure: Dismissals: Involuntary Dismissals: Failures to Prosecute

                                             EXHIBIT 12
