The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our condensed consolidated
financial statements and the related notes and other financial information
included elsewhere in this Quarterly Report on Form 10-Q and in the Annual
Report on Form 10-K. In addition to historical consolidated financial
information, the following discussion contains forward-looking statements that
reflect our plans, estimates, and beliefs. Our actual results may differ
materially from those discussed in the forward-looking statements as a result of
various factors, including those set forth in Part II, Item 1A. Risk Factors and
Note Regarding Forward-Looking Statements included elsewhere in this Quarterly
Report on Form 10-Q and in the Annual Report on Form 10-K.
THE COMPANY
BRP Group, Inc. ("BRP Group," the "Company," "we," "us" or "our") is a rapidly
growing independent insurance distribution firm delivering solutions that give
our Clients the peace of mind to pursue their purpose, passion and dreams. We
support our Clients, Colleagues, Insurance Company Partners and communities
through the deployment of vanguard resources and capital to drive organic and
inorganic growth. We are innovating the industry by taking a holistic and
tailored approach to risk management, insurance and employee benefits. Our
growth plan includes increased geographic representation across the U.S.,
expanded client value propositions and new lines of insurance to meet the needs
of evolving lifestyles, business risks and healthcare funding. We are a
destination employer supported by an award-winning culture, powered by
exceptional people and fueled by industry-leading growth and innovation.
We represent over 600,000 Clients across the United States and internationally.
Our 1,700 Colleagues include approximately 340 Risk Advisors, who are fiercely
independent, relentlessly competitive and "insurance geeks." We have over 80
offices in 18 states, all of which are equipped to provide diversified products
and services to empower our clients at every stage through our four Operating
Groups.
•Middle Market provides expertly-designed private risk management, commercial
risk management and employee benefits solutions for mid-to-large-size businesses
and high net worth individuals, as well as their families.
•MainStreet offers personal insurance, commercial insurance and life and health
solutions to individuals and businesses in their communities.
•Medicare offers consultation for government assistance programs and solutions
to seniors and Medicare-eligible individuals through a network of agents.
•Specialty delivers specialty insurers, professionals, individuals and niche
industry businesses expanded access to exclusive specialty markets, capabilities
and programs requiring complex underwriting and placement.
In 2011, we adopted the "Azimuth" as our corporate constitution. Named after a
historical navigation tool used to find "true north," the Azimuth asserts our
core values, business basics and stakeholder promises. The ideals encompassed by
the Azimuth support our mission to deliver indispensable, tailored insurance and
risk management insights and solutions to our clients. We strive to be regarded
as the preeminent insurance advisory firm fueled by relationships, powered by
people and exemplified by client adoption and loyalty. This type of environment
is upheld by the distinct vernacular we use to describe our services and
culture. We are a firm, instead of an agency; we have Colleagues, instead of
employees; we have Risk Advisors, instead of producers/agents. We serve clients
instead of customers and we refer to our acquisitions as Partnerships. We refer
to insurance brokerages that we have acquired, or in the case of asset
acquisitions, the producers, as Partners.
Seasonality
The insurance brokerage market is seasonal and our results of operations are
somewhat affected by seasonal trends. Our Adjusted EBITDA and Adjusted EBITDA
Margins are typically highest in the first quarter and lowest in the fourth
quarter. This variation is primarily due to fluctuations in our revenues, while
overhead remains consistent throughout the year. Our revenues are generally
highest in the first quarter due to the impact of contingent payments received
in the first quarter from Insurance Company Partners that we cannot readily
estimate before receipt without the risk of significant reversal and a higher
degree of first quarter policy commencements and renewals in Medicare and
certain Middle Market lines of business such as employee benefits and
commercial. In addition, a higher proportion of our first quarter revenue is
derived from our highest margin businesses. As discussed further below, the
COVID-19 pandemic may skew these general trends due to reduced amounts of new
business and reductions in business from existing Clients related to the
pandemic.
Partnerships can significantly impact Adjusted EBITDA and Adjusted EBITDA
Margins in a given year and may increase the amount of seasonality within the
business, especially results attributable to Partnerships that have not been
fully integrated into our business or owned by us for a full year.
                                                                            

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PARTNERSHIPS


We utilize strategic acquisitions, which we refer to as Partnerships, to
complement and expand our business. We source Partnerships through proprietary
deal flow, competitive auctions and cultivated industry relationships. We are
currently considering Partnership opportunities in all of our Operating Groups,
including businesses to complement or expand our MGA of the Future that are
valued at higher purchase price multiples than businesses in our other Operating
Groups.
The financial impact of Partnerships may affect the comparability of our results
from period to period. Our acquisition strategy also entails certain risks,
including the risks that we may not be able to successfully source, value,
close, integrate and effectively manage businesses that we acquire. To mitigate
that risk, we have a professional team focused on finding new Partners and
integrating new Partnerships. We plan to execute on numerous Partnerships
annually as it is a key pillar in our long-term growth strategy over the next
ten years.
We completed two Partnerships for an aggregate purchase price of $26.7 million
during the three months ended March 31, 2021 and four Partnerships for an
aggregate purchase price of $59.7 million during the three months ended March
31, 2020. Partnerships completed during 2021 added $0.7 million of premiums,
commissions and fees receivable, $8.7 million of intangible assets and $17.4
million of goodwill to the condensed consolidated balance sheet.
For additional information on the Partnerships that we have completed during
2021, see Note 3 to our condensed consolidated financial statements included in
Part I, Item 1. Financial Statements of this report.
NOVEL CORONAVIRUS (COVID-19)
In March 2020, the World Health Organization declared a novel strain of the
coronavirus, COVID-19, a pandemic. This COVID-19 outbreak has become
increasingly widespread and severely restricted the level of economic activity
around the world. In response to this outbreak, the governments of many
countries, states, cities and other geographic regions, including in the United
States, have taken preventive or protective actions, such as imposing
restrictions on travel and business operations and advising or requiring
individuals to limit or forgo their time outside of their homes.
Our Clients and Colleagues are our first priority and we have taken steps to
ensure their safety by implementing a remote work environment for the majority
of our Colleagues without disruption to Client service. We have funded the BRP
True North Colleague Fund to assist with relief for COVID-19 and other
qualifying disasters for our Colleagues experiencing extraordinary hardship and
are currently matching Colleague donations dollar-for dollar.
We intend to continue to execute on our strategic plans and operational
initiatives during the pandemic. However, given the uncertainty regarding the
spread and severity of COVID-19, the duration and scope of the government
shutdowns, the nature of societal responses and the adverse effects on the
national and global economy, the related financial impact on our business cannot
be accurately predicted at this time. The national and global economies have
rapidly contracted as a result of COVID-19. The decreased level of economic
activity is leading to, and is likely to continue to lead to, a decline in
exposure units and rising unemployment. In addition, the uncertainties
associated with the protective and preventive measures being put in place or
recommended by both governmental entities and other businesses, among other
uncertainties, may result in delays or modifications to our plans and
initiatives. See Part I, Item 1A. "Risk Factors - The ongoing novel coronavirus
(COVID-19) pandemic could and resulting government actions (including travel
bans, lock downs, maximum occupancy limits and similar actions) could result in
declines in business and increases in claims that could adversely affect our
business, financial condition and results of operations" in our Annual Report on
Form 10-K filed with the SEC on March 11, 2021.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020
The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our condensed consolidated
financial statements for the three months ended March 31, 2021 and the related
notes and other financial information included elsewhere in this report. In
addition to historical financial information, the following discussion and
analysis contains forward-looking statements that involve risks, uncertainties
and assumptions. Our actual results and timing of selected events may differ
materially from those anticipated in these forward-looking statements as a
result of many factors, including those discussed under Part I, Item 1A. Risk
Factors in our Annual Report on Form 10-K filed with the SEC on March 11, 2021.
                                                                            

25

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The following is a discussion of our consolidated results of operations for the three months ended March 31, 2021 and 2020.


                                                                       For the Three Months
                                                                          Ended March 31,
(in thousands)                                                                      2021              2020            Variance
Revenues:
Commissions and fees                                                        

$ 152,828 $ 54,159 $ 98,669



Operating expenses:
Commissions, employee compensation and benefits                                    89,375            34,548            54,827
Other operating expenses                                                           17,568             8,885             8,683
Amortization expense                                                               10,537             3,596             6,941
Change in fair value of contingent consideration                                   (1,503)            1,661            (3,164)
Depreciation expense                                                                  594               165               429
Total operating expenses                                                          116,571            48,855            67,716

Operating income                                                                   36,257             5,304            30,953

Interest expense, net                                                              (5,643)             (585)           (5,058)

Income before income taxes                                                         30,614             4,719            25,895
Income tax provision                                                                    -                12               (12)
Net income                                                                         30,614             4,707            25,907
Less: net income attributable to noncontrolling interests                          16,001             3,239            12,762
Net income attributable to BRP Group, Inc.                                      $  14,613          $  1,468          $ 13,145



Commissions and Fees
We earn commissions and fees by facilitating the arrangement between Insurance
Company Partners and individuals or businesses for the carrier to provide
insurance to the insured party. Our commissions and fees are usually a
percentage of the premium paid by the insured and generally depends on the type
of insurance, the particular Insurance Company Partner and the nature of the
services provided. Under certain arrangements with Clients, we earn
pre-negotiated service fees in lieu of commissions. Additionally, we may also
receive from Insurance Company Partners a profit-sharing commission, or straight
override, which represent forms of variable consideration associated with the
placement of coverage and are based primarily on underwriting results, but may
also contain considerations for volume, growth or retention.
Commissions and fees increased by $98.7 million for the three months ended March
31, 2021 as compared to the same period of 2020. This increase was related to
amounts attributable to Partners acquired during 2020 and 2021 prior to their
having reached the twelve-month owned mark (such amounts, the "Partnership
Contribution") and organic growth. The Partnership Contribution accounted for
$91.2 million of the increase to commissions and fees for the quarter and
organic growth accounted for $7.4 million.
                                                                            

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Major Sources of Commissions and Fees
The following table sets forth our commissions and fees by major source for the
periods indicated:
                                                               For the Three Months
                                                                  Ended March 31,
  (in thousands)                                                               2021           2020        Variance
  Direct bill revenue                                                       $  94,505      $ 28,109      $ 66,396
  Agency bill revenue                                                          33,946        16,429        17,517
  Profit-sharing revenue                                                       10,292         5,124         5,168
  Policy fee and installment fee revenue                                    

4,476 3,382 1,094


  Consulting and service fee revenue                                            1,394           715           679
  Other income                                                                  8,215           400         7,815
  Total commissions and fees                                                

$ 152,828 $ 54,159 $ 98,669




Direct bill revenue represents commission revenue earned by providing insurance
placement services to Clients, primarily for private risk management, commercial
risk management, employee benefits and Medicare insurance types. Direct bill
revenue increased by $66.4 million for the three months ended March 31, 2021 as
compared to the same period of 2020. The Partnership Contribution accounted for
$64.0 million of the increase to direct bill revenue for the quarter. Organic
growth for direct bill revenue was $2.4 million for the quarter.
Agency bill revenue primarily represents commission revenue earned by providing
insurance placement services to clients wherein we act as an agent on behalf of
the Client. Agency bill revenue increased by $17.5 million for the three months
ended March 31, 2021 as compared to the same period of 2020. The Partnership
Contribution accounted for $14.2 million of the increase to agency bill revenue
for the quarter. Organic growth for agency bill revenue was $3.3 million for the
quarter.
Profit-sharing revenue represents bonus-type or contingent revenue that is
earned by us as a sales incentive provided by certain Insurance Company
Partners. Profit-sharing revenue increased by $5.2 million for the three months
ended March 31, 2021 as compared to the same period of 2020 as a result of the
Partnership Contribution of $5.4 million offset in part by organic growth of
$(0.2) million. Profit-sharing revenue was affected by higher loss ratios in our
Middle Market and MainStreet Operating Groups, which is particularly acute in
the Florida homeowners marketplace.
Policy fee and installment fee revenue represents revenue earned for acting in
the capacity of an MGA and providing payment processing and services and other
administrative functions on behalf of Insurance Company Partners. Policy fee and
installment fee revenue increased by $1.1 million during the three months ended
March 31, 2021 as compared to the same period of 2020 from our "MGA of the
Future," which resides in our Specialty Operating Group.
Other income consists of Medicare marketing income that is based on agreed-upon
cost reimbursement for fulfilling specific targeted marketing campaigns in
addition to other fee income and premium financing income generated across all
Operating Groups. Other income increased by $7.8 million for the three months
ended March 31, 2021 as compared to the same period of 2020. The Partnership
Contribution accounted for $7.7 million and organic growth comprised $0.1
million.
Commissions, Employee Compensation and Benefits
Commissions, employee compensation and benefits is our largest expense. It
consists of (a) base compensation comprising salary, bonuses and benefits paid
and payable to Colleagues, commissions paid to Colleagues and outside
commissions paid to others; and (b) equity-based compensation associated with
the grants of restricted interest awards to senior management, Risk Advisors and
executives. We expect to continue to experience a general rise in commissions,
employee compensation and benefits expense commensurate with expected growth in
our sales and headcount and as a result of increasing employee compensation
related to ongoing public company costs. We operate in competitive markets for
human capital and need to maintain competitive compensation levels as we expand
geographically and create new products and services.
Our compensation arrangements with our employees contain significant bonus or
commission components driven by the results of our operations. Therefore, as we
grow commissions and fees, we expect compensation costs to rise.
                                                                            

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Commissions, employee compensation and benefits expenses increased by $54.8
million for the three months ended March 31, 2021 as compared to the same period
of 2020. The Partnership Contribution accounted for $43.7 million of the
increase to commissions, employee compensation and benefits for the quarter.
Share-based compensation expense increased $2.4 million as a result of equity
grants awarded to all newly hired Colleagues, including those who joined us
through Partnerships, and grants to reward Colleagues, including members of
senior management. The remaining increase in commissions, employee compensation
and benefits expense can be attributed to higher commissions expense relating to
our growth and higher compensation and benefits relating to hiring to support
our growth.
Other Operating Expenses
Other operating expenses include travel, accounting, legal and other
professional fees, placement fees, rent, office expenses, depreciation and other
costs associated with our operations. Our occupancy-related costs and
professional services expenses, in particular, generally increase or decrease in
relative proportion to the number of our employees and the overall size and
scale of our business operations. In addition, we have invested in the expansion
of our Tampa offices to accommodate our growth plans, which has resulted in an
increase to rent expense beginning in April 2020. Certain corporate expenses are
allocated to the Operating Groups.
Other operating expenses increased by $8.7 million for the three months ended
March 31, 2021 as compared to the same periods of 2020, which was primarily
attributable to increases in rent expense of $2.7 million relating to expansion
of our corporate offices and operating locations, dues and subscriptions of $1.5
million from our investment in technology to support our growth, consulting of
$0.9 million, software and internet of $0.7 million relating to Partners who
joined us in 2020, professional fees of $0.5 million related to Partnership
transactions and public company costs, licenses and taxes of $0.5 million and
advertising and marketing of $0.4 million.
Amortization Expense
Amortization expense increased by $6.9 million for the three months ended March
31, 2021 as compared to the same period of 2020, which was driven by
amortization related to Partners acquired over the past twelve months.
Change in Fair Value of Contingent Consideration
Change in fair value of contingent consideration was $(1.5) million for the
three months ended March 31, 2021 as compared to $1.7 million for the same
period of 2020. The change in fair value of contingent consideration results
from fluctuations in the value of the relevant measurement basis, normally
revenue or EBITDA, of our Partners.
Interest Expense, Net
Interest expense, net increased by $5.1 million for the three months ended March
31, 2021 as compared to the same period of 2020 resulting from $398.0 million in
debt outstanding at a 4.75% interest rate during the first quarter of 2021 under
the JPM Credit Agreement. By comparison, we had average outstanding debt of
approximately $50.4 million with an average interest rate of approximately 3.41%
during the first quarter of 2020.
FINANCIAL CONDITION - COMPARISON OF MARCH 31, 2021 TO DECEMBER 31, 2020
Our total assets and total liabilities increased $47.1 million and $11.4
million, respectively, at March 31, 2021 as compared to December 31, 2020. The
most significant changes in assets and liabilities are described below.
Cash and cash equivalents decreased $17.9 million as a result of operating,
investing and financing activities illustrated in the condensed consolidated
statement of cash flows.
Premiums, commissions and fees receivable, net increased $51.1 million as a
result of revenue growth and the timing of revenue recognition under direct bill
policies in employee benefits for which payment is received monthly through the
duration of the year.
Goodwill increased $17.6 million as a result of our first quarter 2021
Partnerships and measurement period adjustments for certain of our 2020
Partnerships.
Premiums payable to insurance companies and producer commissions payable
increased $8.0 million and $9.5 million, respectively, as a result of revenue
growth.
                                                                            

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NON-GAAP FINANCIAL MEASURES
Adjusted EBITDA, Adjusted EBITDA Margin, Organic Revenue, Organic Revenue
Growth, Adjusted Net Income and Adjusted Diluted Earnings Per Share ("EPS"), are
not measures of financial performance under GAAP and should not be considered
substitutes for GAAP measures, including commissions and fees (for Organic
Revenue and Organic Revenue Growth), net income (loss) (for Adjusted EBITDA and
Adjusted EBITDA Margin) net income (loss) attributable to BRP Group, Inc. (for
Adjusted Net Income) or diluted earnings (loss) per share (for Adjusted Diluted
EPS), which we consider to be the most directly comparable GAAP measures. These
non-GAAP financial measures have limitations as analytical tools, and when
assessing our operating performance, you should not consider these non-GAAP
financial measures in isolation or as substitutes for commissions and fees, net
income (loss), net income (loss) attributable to BRP Group, Inc. or other
consolidated income statement data prepared in accordance with GAAP. Other
companies in our industry may define or calculate these non-GAAP financial
measures differently than we do, and accordingly these measures may not be
comparable to similarly titled measures used by other companies.
Adjusted EBITDA eliminates the effects of financing, depreciation, amortization
and change in fair value of contingent consideration. We define Adjusted EBITDA
as net income (loss) before interest, taxes, depreciation, amortization, change
in fair value of contingent consideration and certain items of income and
expense, including share-based compensation expense, transaction-related
expenses related to Partnerships including severance, and certain non-recurring
costs, including those related to raising capital. We believe that Adjusted
EBITDA is an appropriate measure of operating performance because it eliminates
the impact of expenses that do not relate to business performance, and that the
presentation of this measure enhances an investor's understanding of our
financial performance.
Adjusted EBITDA Margin is Adjusted EBITDA divided by commissions and fees.
Adjusted EBITDA Margin is a key metric used by management and our board of
directors to assess our financial performance. We believe that Adjusted EBITDA
Margin is an appropriate measure of operating performance because it eliminates
the impact of expenses that do not relate to business performance, and that the
presentation of this measure enhances an investor's understanding of our
financial performance. We believe that Adjusted EBITDA Margin is helpful in
measuring profitability of operations on a consolidated level.
Adjusted EBITDA and Adjusted EBITDA Margin have important limitations as
analytical tools. For example, Adjusted EBITDA and Adjusted EBITDA Margin:
•do not reflect any cash capital expenditure requirements for the assets being
depreciated and amortized that may have to be replaced in the future;
•do not reflect changes in, or cash requirements for, our working capital needs;
•do not reflect the impact of certain cash charges resulting from matters we
consider not to be indicative of our ongoing operations;
•do not reflect the interest expense or the cash requirements necessary to
service interest or principal payments on our debt;
•do not reflect share-based compensation expense and other non-cash charges; and
•exclude certain tax payments that may represent a reduction in cash available
to us.
We calculate Organic Revenue Growth based on commissions and fees for the
relevant period by excluding the first twelve months of commissions and fees
generated from new Partners. Organic Revenue Growth is the change in Organic
Revenue period-to-period, with prior period results adjusted for Organic
Revenues that were excluded in the prior period because the relevant Partners
had not yet reached the twelve-month owned mark, but which reach the
twelve-month owned mark in the current period. For example, revenues from a
Partner acquired on June 1, 2020 are excluded from Organic Revenue for 2020.
However, after June 1, 2021, results from June 1, 2020 to December 31, 2020 for
such Partners are compared to results from June 1, 2021 to December 31, 2021 for
purposes of calculating Organic Revenue Growth in 2021. Organic Revenue Growth
is a key metric used by management and our board of directors to assess our
financial performance. We believe that Organic Revenue and Organic Revenue
Growth are appropriate measures of operating performance as they allow investors
to measure, analyze and compare growth in a meaningful and consistent manner.
Adjusted Net Income is presented for the purpose of calculating Adjusted Diluted
EPS. We define Adjusted Net Income as net income (loss) attributable to BRP
Group, Inc. adjusted for amortization, change in fair value of contingent
consideration and certain items of income and expense, including share-based
compensation expense, transaction-related expenses related to Partnerships
including severance, and certain non-recurring costs that, in the opinion of
management, significantly affect the period-over-period assessment of operating
results, and the related tax effect of those adjustments.
                                                                            

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Adjusted Diluted EPS measures our per share earnings excluding certain expenses
as discussed above and assuming all shares of Class B common stock were
exchanged for Class A common stock. Adjusted Diluted EPS is calculated as
Adjusted Net Income divided by adjusted dilutive weighted-average shares
outstanding. We believe Adjusted Diluted EPS is useful to investors because it
enables them to better evaluate per share operating performance across reporting
periods.
Adjusted EBITDA and Adjusted EBITDA Margin
The following table reconciles Adjusted EBITDA and Adjusted EBITDA Margin to net
income, which we consider to be the most directly comparable GAAP financial
measure to Adjusted EBITDA and Adjusted EBITDA Margin:
                                                                 For the 

Three Months


                                                                    Ended March 31,
(in thousands, except percentages)                                               2021           2020
Commissions and fees                                                         $ 152,828       $ 54,159

Net income                                                                   $  30,614       $  4,707
Adjustments to net income:
Amortization expense                                                            10,537          3,596
Interest expense, net                                                            5,643            585
Share-based compensation                                                         3,542          1,139
Transaction-related Partnership expenses                                         2,445          1,848
Change in fair value of contingent consideration                                (1,503)         1,661
Depreciation expense                                                               594            165
Severance related to Partnership activity                                            -             53
Income tax provision                                                                 -             12
Other                                                                              859            266
Adjusted EBITDA                                                              $  52,731       $ 14,032
Adjusted EBITDA Margin                                                              35  %          26  %


Organic Revenue and Organic Revenue Growth
The following table reconciles Organic Revenue to commissions and fees, which we
consider to be the most directly comparable GAAP financial measure to Organic
Revenue:
                                                           For the Three Months
                                                              Ended March 31,
       (in thousands, except percentages)                                  2021           2020
       Commissions and fees                                            $

152,828 $ 54,159


       Partnership commissions and fees (1)                             

(91,215) (22,868)


       Organic Revenue                                                 $ 

61,613 $ 31,291


       Organic Revenue Growth (2)                                      $  

7,447 $ 1,454


       Organic Revenue Growth % (2)                                           14  %           5  %


__________


(1)  Includes the first twelve months of such commissions and fees generated
from newly acquired Partners. Amount is reduced by approximately $830,000 for
the timing of certain cash receipts that were fully constrained under ASC 606 in
the post-partnership period for our partnership with Agency RM, which closed
February 1, 2020.
(2)  Organic Revenue for the three months ended March 31, 2020 used to calculate
Organic Revenue Growth for the three months ended March 31, 2021 was $54.2
million, which is adjusted to reflect revenues from Partnerships that reached
the twelve-month owned mark during the three months ended March 31, 2021.
                                                                            

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Adjusted Net Income and Adjusted Diluted EPS
The following table reconciles Adjusted Net Income to net income attributable to
BRP Group, Inc. and reconciles Adjusted Diluted EPS to diluted earnings per
share attributable to BRP Group, Inc. Class A common stock:
                                                                                  For the Three
                                                                                      Months
                                                                                  Ended March 31,
(in thousands, except per share data)                                                     2021               2020
Net income attributable to BRP Group, Inc.                                            $  14,613          $   1,468
Net income attributable to noncontrolling interests                                      16,001              3,239
Amortization expense                                                                     10,537              3,596
Share-based compensation                                                                  3,542              1,139
Transaction-related Partnership expenses                                                  2,445              1,848
Change in fair value of contingent consideration                                         (1,503)             1,661
Amortization of deferred financing costs                                                    693                 76
Severance related to Partnership activity                                                     -                 53
Other                                                                                       859                266
Adjusted pre-tax income                                                                  47,187             13,346
Adjusted income taxes (1)                                                                 4,672              1,321
Adjusted Net Income                                                                   $  42,515          $  12,025

Weighted-average shares of Class A common stock outstanding - diluted

                                                                                  45,783             19,816
Exchange of Class B shares (2)                                                           49,789             43,541
Adjusted dilutive weighted-average shares outstanding                                    95,572             63,357

Adjusted Diluted EPS                                                                  $    0.44          $    0.19

Diluted earnings per share                                                            $    0.32          $    0.07
Other adjustments to earnings per share                                                    0.17               0.14
Adjusted income taxes per share                                                           (0.05)             (0.02)
Adjusted Diluted EPS                                                                  $    0.44          $    0.19


___________
(1)  Represents corporate income taxes at assumed effective tax rate of 9.9%
applied to adjusted pre-tax income.
(2)  Assumes the full exchange of Class B shares for Class A common stock
pursuant to the Third Amended and Restated Limited Liability Company Agreement
of BRP, as amended (the "Amended LLC Agreement").

                                                                            

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OPERATING GROUP RESULTS
Commissions and Fees
In the Middle Market, MainStreet and Specialty Operating Groups, we generate
commissions and fees from insurance placement under both agency bill and direct
bill arrangements. In addition, we generate profit-sharing income in each of
those segments based on either the underlying Book of Business or performance,
such as loss ratios. In the Middle Market Operating Group only, we generate fees
from service fee and consulting arrangements. Service fee arrangements are in
place with certain customers in lieu of commission arrangements.
In the Medicare Operating Group, we generate commissions and fees in the form of
direct bill insurance placement and marketing income. Marketing income is earned
through co-branded marketing campaigns with our Insurance Company Partners.
The following table sets forth our commissions and fees by Operating Group by
amount and as a percentage of our commissions and fees:
                                Commissions and Fees by Operating Group (in thousands)
                                                                                                       For the Three Months
                                                                                                          Ended March 31,
                                                                                                     2021               2020                Variance
                                                                                                                                     Percent of                Percent of
Operating Group                                                                                                           Amount      Business      Amount      Business      Amount       %
Middle Market                                                                                                          $ 110,555            72  % $ 22,032            41  % $ 88,523         n/m
Specialty                                                                                                                 25,082            16  %   17,416            32  %    7,666       44  %
MainStreet                                                                                                                 8,222             5  %    8,308            15  %      (86)      (1) %
Medicare                                                                                                                   9,452             6  %    6,403            12  %    3,049       48  %

Corporate and Other                                                                                                         (483)            -  %        -             -  %     (483)       -  %
                                                                                                                       $ 152,828                  $ 54,159                  $ 98,669

__________


n/m  not meaningful
Commissions and fees for our Middle Market Operating Group increased $88.5
million for the first quarter of 2021 as compared to the same period of 2020 as
a result of the Partnership Contribution of $87.1 million and organic growth of
$1.4 million. Middle Market experienced organic growth in base commissions and
fees of $1.7 million. This was offset in part by a decrease in organic
contingent revenue of $0.3 million resulting from higher loss ratios due to
challenges in the Florida insurance marketplace.
Commissions and fees for our Specialty Operating Group increased $7.7 million
for the first quarter of 2021 as compared to the same period of 2020 as a result
of organic growth of $6.9 million, primarily attributable to growth in our
renter's insurance product in addition to the Partnership Contribution of $0.8
million.
Commissions and fees for our MainStreet Operating Group decreased $0.1 million
for the first quarter of 2021 as compared to the same period of 2020. MainStreet
had a decrease in organic contingent revenue of $0.8 million resulting from
higher loss ratios due to challenges in the Florida insurance marketplace, which
was offset in part by organic growth in base commissions and fees of $0.7
million.
Commissions and fees for our Medicare Operating Group increased $3.0 million for
the first quarter of 2021 as compared to the same period of 2020 as a result of
the Partnership Contribution of $3.2 million, partially offset by a loss of $0.2
million organically. Continued COVID-19 protocols, including social distancing,
reduced our Medicare agents' ability to meet person-to-person in our normal
venues, which impacted our ability to sell new business during the 2021 Annual
Enrollment Period.
Revenue reported for Corporate and Other relates to the elimination of
intercompany revenue. The Middle Market Operating Group recorded intercompany
commissions and fees from activity with the Specialty Operating Group of
$0.4 million; the MainStreet Operating Group recorded intercompany commissions
and fees from activity with the Middle Market Operating Group of $30,000; and
the Medicare Operating Group recorded intercompany commissions and fees from
activity within the Medicare Operating Group of $0.1 million. These amounts were
eliminated through Corporate and Other.
                                                                            

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Policies in force for Specialty's MGA of the Future grew by 164,594, or 41%, to
566,114 at March 31, 2021 from 401,520 at March 31, 2020.
Commissions, Employee Compensation and Benefits
The following table sets forth our commissions, employee compensation and
benefits by Operating Group by amount and as a percentage of our commissions,
employee compensation and benefits:
                             Commissions, Employee Compensation and 

Benefits by Operating Group (in thousands)


                                                                                                                      For the Three Months
                                                                                                                         Ended March 31,
                                                                                                                     2021                    2020                Variance
                                                                                                                                                          Percent of                Percent of
Operating Group                                                                                                                                Amount      Business      Amount      Business      Amount       %
Middle Market                                                                                                                                $ 56,742            63  % $ 12,620            37  % $ 44,122     350  %
Specialty                                                                                                                                      17,952            20  %   12,801            37  %    5,151      40  %
MainStreet                                                                                                                                      5,146             6  %    3,962            11  %    1,184      30  %
Medicare                                                                                                                                        4,578             5  %    3,016             9  %    1,562      52  %
Corporate and Other                                                                                                                             4,957             6  %    2,149             6  %    2,808     131  %
                                                                                                                                             $ 89,375                  $ 34,548                  $ 54,827


Commissions, employee compensation and benefits expenses increased across all
Operating Groups for the three months ended March 31, 2021 as compared to the
same period of 2020. The Partnership Contribution accounted for $41.4 million
and $0.7 million of the increase to commissions, employee compensation and
benefits expenses in the Middle Market and Specialty Operating Groups,
respectively, and significantly all of the Medicare Operating Group's
commissions, employee compensation and benefits expenses. Commissions, employee
compensation and benefits expenses also increased in the Middle Market,
Specialty and MainStreet Operating Groups as a result of continued investments
in Growth Services to support our growth, which costs are primarily allocated
among the Operating Groups, and continued investment in sales and service
talent.
Commissions, employee compensation and benefits expenses for Corporate and Other
increased as a result of hiring new roles necessary as a public company and due
to $2.4 million of additional share-based compensation expense incurred during
the quarter.
Other Operating Expenses
The following table sets forth our other operating expenses by Operating Group
by amount and as a percentage of our other operating expenses:
                               Other Operating Expenses by Operating Group 

(in thousands)


                                                                                                       For the Three Months
                                                                                                          Ended March 31,
                                                                                                      2021               2020                Variance
                                                                                                                                      Percent of               Percent of
Operating Group                                                                                                            Amount      Business      Amount     Business      Amount      %
Middle Market                                                                                                            $  8,025            46  % $ 2,741            31  % $ 5,284     193  %
Specialty                                                                                                                   1,921            11  %   1,483            17  %     438      30  %
MainStreet                                                                                                                  1,092             6  %     997            11  %      95      10  %
Medicare                                                                                                                    1,407             8  %     790             9  %     617      78  %
Corporate and Other                                                                                                         5,123            29  %   2,874            32  %   2,249      78  %
                                                                                                                         $ 17,568                  $ 8,885                  $ 8,683


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Other operating expenses for our Middle Market Operating Group increased $5.3
million driven by higher costs for rent expense of $2.0 million, and dues and
subscriptions of $0.9 million, software and internet of $0.7 million and
consulting of $0.5 million, offset in part by lower professional fees of $0.6
million. Other operating expenses for our Specialty Operating Group increased
$0.4 million driven by higher costs for bank charges of $0.1 million, rent
expense of $0.1 million and consulting of $0.1 million. Other operating expenses
for our Medicare Operating Group increased $0.6 million driven by higher costs
for advertising and marketing of $0.2 million and professional fees of $0.1
million. The increases in our operating costs are related to our growth, both
organically and through Partnerships, during the previous twelve months.
Other operating expenses in Corporate and Other increased $2.2 million due to
higher costs for professional fees of $1.1 million, dues and subscriptions of
$0.5 million and rent expense of $0.5 million related to expansion of our Tampa
offices.
Amortization Expense
The following table sets forth our amortization by Operating Group by amount and
as a percentage of our amortization:
                                Amortization Expense by Operating Group (in thousands)
                                                                                                      For the Three Months
                                                                                                         Ended March 31,
                                                                                                     2021              2020                Variance
                                                                                                                                    Percent of               Percent of
Operating Group                                                                                                          Amount      Business      Amount     Business      Amount       %
Middle Market                                                                                                          $  7,449            71  % $   571            16  % $ 6,878           n/m
Specialty                                                                                                                 2,309            22  %   2,366            66  %     (57)        (2) %
MainStreet                                                                                                                  416             4  %     431            12  %     (15)        (3) %
Medicare                                                                                                                    363             3  %     225             6  %     138         61  %
Corporate and Other                                                                                                           -             -  %       3             -  %      (3)      (100) %
                                                                                                                       $ 10,537                  $ 3,596                  $ 6,941


__________
n/m  not meaningful
Amortization expense increased for our Middle Market and Medicare Operating
Groups for the three months ended March 31, 2021 as compared to the same period
of 2020 driven by amortization related to Partners acquired over the past twelve
months. Amortization for the remaining groups was relatively flat.
Change in Fair Value of Contingent Consideration
The following table sets forth our change in fair value of contingent
consideration by Operating Group by amount and as a percentage of our change in
fair value of contingent consideration:
                            Change in Fair Value of Contingent 

Consideration by Operating Group (in thousands)


                                                                                                                    For the Three Months
                                                                                                                       Ended March 31,
                                                                                                                   2021                    2020                Variance
                                                                                                                                                        Percent of                Percent of
Operating Group                                                                                                                              Amount      Business      Amount      Business      Amount       %
Middle Market                                                                                                                              $ (3,523)          234  % $ (2,166)         (130) % $ (1,357)     63  %
Specialty                                                                                                                                     1,035           (69) %    2,447           147  %   (1,412)    (58) %
MainStreet                                                                                                                                      193           (13) %    1,627            98  %   (1,434)    (88) %
Medicare                                                                                                                                        792           (53) %     (247)          (15) %    1,039        n/m
                                                                                                                                           $ (1,503)                 $  1,661                  $ (3,164)


__________
n/m  not meaningful
The change in fair value of contingent consideration results from fluctuations
in the value of the relevant measurement basis, normally revenue or EBITDA of
our Partners.
                                                                            

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LIQUIDITY AND CAPITAL RESOURCES
Our primary liquidity needs for the foreseeable future will include cash to
(i) provide capital to facilitate the organic growth of our business and to fund
future Partnerships, (ii) pay operating expenses, including cash compensation to
our employees and expenses related to being a public company, (iii) make
payments under the Tax Receivable Agreement, (iv) pay interest and principal due
on borrowings under the JPM Credit Agreement, (v) pay contingent earnout
liabilities, and (vi) pay income taxes. We have historically financed our
operations and funded our debt service through the sale of our insurance
products and services. In addition, we financed significant cash needs to fund
growth through the acquisition of Partners through debt and equity financing.
At March 31, 2021, our cash and cash equivalents were $90.5 million. We believe
that our cash and cash equivalents, cash flow from operations and available
borrowings under the JPM Credit Agreement will be sufficient to fund our working
capital and meet our commitments for the foreseeable future. However, we expect
that we will require additional funding to continue to execute on our
Partnership strategy. Such funding could include the incurrence of additional
debt and the issuance of equity. Additional funds may not be available on a
timely basis, on favorable terms, or at all, and such funds, if raised, may not
be sufficient to enable us to continue to implement our long-term Partnership
strategy. If we are not able to raise funds when needed, we could be forced to
delay or reduce the number of Partnerships that we complete.
JPM Credit Agreement
On October 14, 2020, we entered into the JPM Credit Agreement with JPMorgan
Chase Bank, N.A., to provide senior secured credit facilities in an aggregate
principal amount of $800.0 million. The amount consists of (i) a term loan
facility in the principal amount of $400.0 million maturing in 2027 (the "Term
Loan B") and (ii) a revolving credit facility with commitments in an aggregate
principal amount of $400.0 million maturing in 2025 (the "Revolving Facility").
The Revolving Facility and the remaining proceeds of the Term Loan B are
available to finance working capital needs and for other general corporate
purposes of BRP and certain of its subsidiaries (including acquisitions and
other investments permitted under the JPM Credit Agreement.
The Term Loan B bears interest at LIBOR plus 400 bps with a floor of 4.75%. The
applicable interest rate on the Term Loan B at December 31, 2020 was 4.75%.
Borrowings under the Revolving Facility accrue interest at LIBOR plus 200 basis
points ("bps") to LIBOR plus 300 bps based on total net leverage ratio. BRP will
pay a letter of credit fee equal to the margin then in effect with respect to
LIBOR loans under the Revolving Facility multiplied by the daily amount
available to be drawn under any letter of credit, a fronting fee and any
customary documentary and processing charges for any letter of credit issued
under the JPM Credit Agreement.
The outstanding principal balance of the Term Loan B is required to be repaid in
equal quarterly installments equal to 0.25% of the original principal amount of
the Term Loan B beginning with the fiscal quarter ending December 31, 2020, the
balance of which is due at maturity. The Revolving Facility is not subject to
amortization.
The Revolving Facility and the Term Loan B are collateralized by a first
priority lien on substantially all the assets of BRP, including a pledge of all
equity securities of certain of its subsidiaries. The JPM Credit Agreement
contains covenants that, among other things, restrict our ability to make
certain restricted payments, incur additional debt, engage in certain asset
sales, mergers, acquisitions or similar transactions, create liens on assets,
engage in certain transactions with affiliates, change our business, make
certain investments or restrict BRP's ability to make dividends or other
distributions to BRP Group. In addition, the JPM Credit Agreement contains
financial covenants requiring us to maintain our Total First Lien Net Leverage
Ratio (as defined in the JPM Credit Agreement) at or below 5.00 to 1.00 and Debt
Service Coverage Ratio (as defined in the JPM Credit Agreement) at or above 2.25
to 1.00.
On May 7, 2021, the Company entered into an amendment to the JPM Credit
Agreement, under which (a) the financial covenant requiring the Company to
maintain a Total First Lien Net Leverage Ratio at or below 5.00 to 1.00 was
amended to increase such level to 6.00 to 1.00, and (b) the financial covenant
requiring the Company to maintain a Debt Service Coverage Ratio at or above 2.25
to 1.00 was removed.
Tax Receivable Agreement
We expect to obtain an increase in our share of our tax basis of the assets when
BRP's LLC Units are redeemed or exchanged for shares of BRP Group's Class A
common stock. This increase in tax basis may have the effect of reducing the
future amounts paid to various tax authorities. The increase in tax basis may
also decrease gains (or increase losses) on future dispositions of certain
capital assets to the extent tax basis is allocated to those capital assets.
                                                                            

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We have a Tax Receivable Agreement that provides for the payment by us to the
parties to the Tax Receivable Agreement of 85% of the amount of cash savings, if
any, in U.S. federal, state and local income tax or franchise tax that we
actually realize as a result of (i) any increase in tax basis in BRP Group's
assets and (ii) tax benefits related to imputed interest deemed arising as a
result of payments made under the tax receivable agreement.
During the three months ended March 31, 2021, we redeemed 112,739 LLC Units on a
one-for-one basis for shares of Class A common stock and cancelled the
corresponding shares of Class B common stock, which triggered an increase in BRP
Group's tax basis but did not result in a tax benefit to the LLC Unit holders.
SOURCES AND USES OF CASH
The following table summarizes our cash flows from operating, investing and
financing activities for the periods indicated:
                                                             For the Three Months
                                                                Ended March 31,
(in thousands)                                             2021                 2020            Variance
Net cash provided by operating activities             $      3,287          $   4,971          $ (1,684)
Net cash used in investing activities                      (18,358)           (39,888)           21,530

Net cash provided by (used in) financing activities (4,404)

    19,811           (24,215)
Net decrease in cash and cash equivalents and
restricted cash                                            (19,475)           (15,106)           (4,369)
Cash and cash equivalents and restricted cash at
beginning of period                                        142,022             71,071            70,951

Cash and cash equivalents and restricted cash at end of period

$    122,547

$ 55,965 $ 66,582




Operating Activities
The primary sources and uses of cash for operating activities are net income
adjusted for non-cash items and changes in assets and liabilities, or operating
working capital. Net cash provided by operating activities decreased $1.7
million for the three months ended March 31, 2021 as compared to the same period
of 2020 driven by a decrease in operating cash relating to a higher balance in
premiums, commissions and fees receivable driven by revenue growth and the
timing of revenue recognition under direct bill policies in employee benefits
for which payment is received monthly through the duration of the year,
partially offset by increases in cash resulting from a net increase in net
income adjusted for noncash items and increases in operating liabilities
balances.
Investing Activities
The primary sources and uses of cash for investing activities relate to cash
consideration paid to fund Partnerships and other investments, as well as
capital expenditures. Net cash used in investing activities decreased $21.5
million for the three months ended March 31, 2021 as compared to the same period
of 2020. Cash consideration paid to fund Partnerships decreased $21.9 million as
a result of a decrease in the size of the aggregate Partnerships we completed
during the first quarter of 2021 compared to the same period of 2020.
Financing Activities
The primary sources and uses of cash for financing activities relate to the
issuance of our Class A common stock, borrowings from and repayment to our
credit agreements, payment of debt issuance costs, payment of contingent earnout
consideration, and other equity transactions. Net cash provided by (used in)
financing activities decreased $24.2 million for the three months ended March
31, 2021 as compared to the same period of 2020 primarily as a result of a
decrease in net borrowings on our credit facilities of $21.0 million.
CRITICAL ACCOUNTING ESTIMATES
In preparing our financial statements in accordance with GAAP, we are required
to make estimates and assumptions that affect the amounts of assets,
liabilities, revenue, expenses, disclosure of contingent assets and liabilities
and accompanying disclosures. We evaluate our estimates and assumptions on an
ongoing basis. These estimates are based on historical experience and various
other assumptions that we believe to be reasonable under the circumstances;
although, actual results may differ from these estimates and assumptions. To the
extent that there are differences between our estimates and actual results, our
financial condition, results of operations and cash flows will be affected.
                                                                            

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There have been no material changes in our critical accounting policies during
the three months ended March 31, 2021 as compared to those disclosed in the
Critical Accounting Estimates section under Management's Discussion and Analysis
of Financial Condition and Results of Operations of our Annual Report on Form
10-K filed with the SEC on March 11, 2021.
EMERGING GROWTH COMPANY STATUS
We are an emerging growth company, as defined in the Jumpstart Our Business
Startups ("JOBS") Act, and we may take advantage of certain exemptions from
various reporting requirements that are applicable to other public companies
that are not emerging growth companies. Section 107 of the JOBS Act provides
that an emerging growth company can take advantage of the extended transition
period for the implementation of new or revised accounting standards. We have
elected to use the extended transition period for complying with new or revised
accounting standards and as a result of this election, our financial statements
may not be comparable to companies that comply with public company effective
dates. We have also elected to take advantage of some of the reduced regulatory
and reporting requirements of emerging growth companies pursuant to the JOBS
Act, including not being required to comply with the auditor attestation
requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure
obligations regarding executive compensation and exemptions from the
requirements of holding non-binding advisory votes on executive compensation and
golden parachute payments, if applicable.
We may take advantage of these exemptions up until the last day of the fiscal
year following the fifth anniversary of our initial public offering or such
earlier time that we are no longer an emerging growth company. We would cease to
be an emerging growth company if we have more than $1.07 billion in annual
revenue, we have more than $700.0 million in market value of our stock held by
non-affiliates (and we have been a public company for at least 12 months and
have filed one annual report on Form 10-K) or we issue more than $1.0 billion of
non-convertible debt securities over a three-year period.
RECENT ACCOUNTING PRONOUNCEMENTS
Please refer to Note 1 to our condensed consolidated financial statements
included in Part I, Item 1. Financial Statements of this report for a discussion
of recent accounting pronouncements that may impact us.

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