LINE OF CREDIT AGREEMENT
BORROWER'S NAME AND ADDRESS LENDER'S NAME AND ADDRESS
FIRST COMMAND FINANCIAL INDEPENDENT RESEARCH AGENCY
CORPORATION FOR LIFE INSURANCE, INC.
4100 SOUTH XXXXX XX XXX 0000
XXXX XXXXX, XX 00000 XXXX XXXXX, XX 00000
"We" and "us" means the borrower above "You" means the lender above, its
successors and assigns
Pursuant to the terms of this Line of Credit Agreement (this "AGREEMENT"), you
have extended to us a line of credit (the "LINE OF CREDIT") in the maximum
principal amount of EIGHT MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($8,500,000.00). You will make loans to us from time to time until 2:00 p.m. on
November 30, 1999, provided we have given you a written request stating the
amount to be advanced at least fourteen (14) business days prior to the date the
advance is to be made. Although the Line of Credit expires on November 30,
1999, we will remain obligated to perform all our duties under this Agreement so
long as we owe you any money advanced according to the terms of this Agreement,
as evidenced by the Note. This Agreement is an agreement between you and us.
It is not intended that any third party receive any benefit from this Agreement,
whether by direct payment, reliance for future payment or in any other manner.
The other terms and conditions of the Line of Credit are as follows:
1. OBLIGATION: Except as otherwise provided in this Agreement, the Line of
Credit is obligatory. You may not refuse to make a loan to us under this
Agreement unless one of the following occurs:
(a) We have borrowed the maximum amount available to us.
(b) The Line of Credit has expired.
(c) We have done or failed to do anything which, with or without the
giving of notice or the passage of time would constitute an Event of
Default under the Note;
(d) We have done or failed to do anything which, with or without the
giving of notice or the passage of time would constitute an Event of
Default under the Deed of Trust or under any of the other Loan
Documents; or
(e) We have not satisfied the conditions precedent set forth in
PARAGRAPH 7 of this Agreement.
Subject to the limitations above, the Line of Credit is closed-end. We may
borrow up to the maximum only one time.
2. PROMISSORY NOTE: We will repay any advances made under this Agreement as
set out in our Promissory Note dated June 1, 1998 which is payable to you
in the principal
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amount of $8,500,000.00 (the "NOTE"). The Note sets out the terms relating
to maturity, interest rate, repayment and advances. The advances will be
made as follows:
Advances will be made from time to time in such amounts and on such
dates as we request, provided that the total amount of all advances
will not exceed $7,000,000.00 plus up to $1,500,000.00 to pay interest
which accrues on the Note prior to December 1, 1999, as provided in
the Note, and provided that no advance shall be made after
November 30, 1999. Although the Note is for $8,500,000.00, the amount
of cash advances you are obligated to make to us will not exceed
$7,000,000.00. The additional $1,500,000.00 is estimated to be an
amount sufficient to cover accrued interest on the Note, which accrues
monthly prior to December 1, 1999. As the interest accrues, if we are
otherwise entitled to an advance under the provisions of PARAGRAPHS 1
and 7 of this Agreement, you will, upon our request on each date on
which a monthly payment of interest is due and payable under the Note,
make an "advance" equal to the amount of the accrued unpaid interest
then due on the Note by an entry on your books, which will then
increase the amount of principal then advanced on the Note and which
will result in the interest payment for which the advance was made
being deemed paid in full. We have the right, however, to pay this
accrued interest in cash if we so elect.
3. LOAN DOCUMENTS: We have executed and delivered to you the following
documents in connection with this Agreement and the Note:
(a) Deed of Trust, Security Agreement, Financing Statement and Assignment
of Rents and Leases dated June 1, 1998 (the "DEED OF TRUST").
(b) Financing Statement.
This Agreement, the Note, the Deed of Trust, the Financing Statement, and
all other documents evidencing, securing, supporting, or guaranteeing the
Line of Credit are sometimes collectively referred to in this Agreement as
the "LOAN DOCUMENTS".
4. REMEDIES: If we are in default on the Note, the Deed of Trust or any of
the other Loan Documents you may:
(a) take any action as provided in any of the Loan Documents; and
(b) without notice to us, immediately suspend all advances under this
Agreement and the Note and terminate the Line of Credit.
By selecting any of these remedies you do not give up our right to later
use any other remedy. By deciding not to use any remedy should we default,
you do not waive your right to later consider the event a default, if it
happens again.
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5. COST AND FEES: If you hire an attorney to enforce this Agreement we will
pay your reasonable attorney's fees, where permitted by law. We will also
pay your court costs and costs of collection, where permitted by law.
6. NOTICES: All notices or other correspondence to us should be sent to our
address stated above to the attention of "Chief Executive Officer." We
will send all notices or correspondence to you to your address stated above
to the attention of "Chief Financial Officer." All notices or
correspondence shall be effective two (2) days after being deposited in the
mail properly addressed with postage prepaid, certified or registered mail,
return receipt requested, or when delivered in person.
7. CONDITIONS PRECEDENT.
(a) You are not obligated to make the first advance to us under this
Agreement until the following have occurred:
(i) We have executed and delivered to you all of the Loan Documents;
(ii) You have a first lien on the collateral described in the Deed
of Trust; and
(iii) You have received certified copies of resolutions adopted by
our board of directors authorizing the Loan Documents and the
transactions contemplated by the Loan Documents, and a
certificate of existence and a certificate of account status
from the Texas Secretary of State and Comptroller of Public
Accounts, respectively, all in form and substance reasonably
acceptable to your counsel.
(b) You are not obligated to make any loan advance to us under this
Agreement if:
(i) After the advance, the total amount advanced under the Note
would exceed a total of $7,000,000.00 advanced directly by
you to us or a total of $1,500,000.00 advanced by you to pay
interest on the Note;
(ii) All of the representations and warranties made by us in the
loan documents are not true, correct, and complete in all
material respects; or
(iii) We have violated any of our covenants under any of the Loan
Documents.
8. MISCELLANEOUS: This Agreement may not be changed except by a written
agreement signed by you and us. The law of the state of Texas will govern
this Agreement. Any term or provision of this Agreement which is contrary
to applicable law will not be effective, unless the law permits you and us
to agree to such a variation.
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THE WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
EXECUTED to be effective for all purposes as of June 1, 1998.
BORROWER: LENDER:
FIRST COMMAND FINANCIAL INDEPENDENT RESEARCH AGENCY
CORPORATION FOR LIFE INSURANCE, INC.
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxx
--------------------------- ---------------------------
Title: Chief Executive Officer Title: Chief Financial Officer
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