1 EXHIBIT 10.1 [IMPERIAL BANK LETTERHEAD] Subject: Credit Terms and Conditions ("Agreement") Gentlemen: To induce you to make loans to the undersigned (herein called "Borrower"), and in consideration of any loan or loans you, in your sole discretion,...

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                                                                  EXHIBIT 10.1

[IMPERIAL BANK LETTERHEAD]

Subject: Credit Terms and Conditions ("Agreement")

Gentlemen:

To induce you to make loans to the undersigned (herein called "Borrower"), and
in consideration of any loan or loans you, in your sole discretion, may make to
Borrower, Borrower warrants and agrees as follows:

X. Xxxxxxxx represents and warrants that:

     1.   Existence and Rights. Company is a California Corporation.

Borrower is duly organized and existing and in good standing under the laws of
the State of California (without limit as to the duration of its existence) and
is authorized and in good standing to do business in the State of California;
Company has powers and adequate authority, rights and franchises to own its
property and to carry on its business as now conducted, and is duly qualified
and in good standing in each State in which the character of the properties
owned by it therein or the conduct of its business makes such qualification
necessary; and Borrower has the power and adequate authority to make and carry
out this Agreement. Borrower has no investment in any other business entity,
except;

Great Pacific Insurance Company
Pinnacle Data Corporation
Fastrac Systems, Inc. Insurance Agent and Broker, and Fastrac Systems, Inc.

     2.   AGREEMENT AUTHORIZED. The execution, delivery and performance of this
          Agreement are duly authorized and do not require the consent or
          approval of any governmental body or other regulatory authority; are
          not in contravention of or in conflict with any law or regulation or
          any term or provision of Borrower's articles of incorporation,
          by-laws, or Articles of Association, as the case may be, and this
          Agreement is the valid, binding and legally enforceable obligation of
          Borrower in accordance with its terms.

     3.   NO CONFLICT. The execution, delivery and performance of this Agreement
          are not in contravention of or in conflict with any agreement,
          indenture or undertaking to which Borrower is a party or by which it
          or any of its property may be bound or affected, and do not cause any
          lien, charge or other encumbrance to be created or imposed upon any
          such property by reason thereof.

     4.   LITIGATION. To the knowledge of Borrower (I) there is no litigation or
          other legal proceedings pending or threatened against Borrower, which
          individually or in the aggregate would have a material adverse effect
          on the financial condition, operations, or business of Borrower; and
          (ii) Borrower is not in default with respect to any order, writ,
          injunction, decree or demand of any court or other governmental or
          regulatory authority, where such default would have a material adverse
          effect to the financial condition, operations or business of Borrower.

     5.   FINANCIAL CONDITION. The balance sheet of Borrower as of 6/30/95, and
          the related profit and loss statement for the six months ended on that
          date, copy of which has heretofore been delivered to you by Borrower,
          and all other statements and data submitted in writing by Borrower to
          you in connection with this request for credit are true and correct,
          and said balance sheet and profit and loss statement fairly present
          the financial condition of Borrower as of the date thereof and the
          results of the operations of Borrower for the period covered thereby,
          and have been prepared in accordance with generally accepted
          accounting principles on a basis consistently maintained. Since such
          date there have been no materially adverse changes in the financial
          condition or business of Borrower. Except for the undertaking to
          repurchase approximately 700,000 shares of common stock of Borrower
          either in the open market or in privately negotiated transactions,
          Borrower has no knowledge of any material liabilities, contingent or
          otherwise, at such date not reflected in said balance sheet in any
          case where such liabilities are required to be so set forth in
          accordance with generally accepted accounting principles, consistently
          applied.

     6.   TITLE TO ASSETS. Borrower has good title to its assets.

     7.   TAX STATUS. Borrower has no liability for any delinquent state, local
          or federal taxes, not subject to dispute by Xxxxxxxx and for which
          reasonable reserves have been established and, if Borrower has
          contracted with any government agency, Borrower has no liability for
          renegotiation of profits.

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8.   TRADEMARKS, PATENTS. Borrower, as of the date hereof, possesses all
     necessary trademarks, trade names, copyrights, patents, patent rights, and
     licenses to conduct its business as now operated, without any known
     conflict with the valid trademarks, trade names, copyrights, patents and
     license rights of others.

9.   REGULATION U. The collateral for this loan is not margin stock within the
     definition of Regulation U of the Board Governors of the Federal Reserve
     system.

X.   Xxxxxxxx agrees that so long as it is indebted to you, it will, unless you
     shall otherwise consent in writing:

     1.   RIGHTS AND FACILITIES. Maintain and preserve all rights, franchises
          and other authority adequate for the conduct of its business;
          maintain its properties, equipment and facilities in good order and
          repair, conduct its business in an orderly manner without voluntary
          interruption and, if a corporation or partnership, maintain and
          preserve kind its existence.

     2.   INSURANCE. Maintain public liability, property damage and workers'
          compensation insurance and insurance on all its insurable property
          against fire and other hazards with responsible insurance carriers to
          the extent usually maintained by similar businesses.

     3.   TAXES AND OTHER LIABILITIES. Pay and discharge, before the same
          become delinquent and before penalties accrue thereon, all taxes,
          assessments and governmental charges upon or against it or any of its
          properties, and all its other liabilities at any time existing,
          except to the extent and so long as:

          (a)  The same are being contested in good faith and by appropriate
               proceedings in such manner as not to cause any materially
               adverse effect upon its financial condition or the loss of any
               right of redemption from any sale thereunder; and

          (b)  It shall have set aside on its books reserves (segregated to the
               extent required by generally accepted accounting practice)
               deemed adequate with respect thereto.

     4.   NET WORTH. Maintain a tangible net worth (meaning the excess of all
          assets, excluding any value for good will, trademarks, patents,
          copyrights, leaseholds, organization expense and other similar
          intangible items, over its liabilities) of not less than $26,000,000.

     5.   PROFITABILITY. Borrower to be profitable for the third and fourth
          quarters of the 1996 fiscal year, thereafter, on a fiscal year basis
          and shall not have losses for any two consecutive quarters.

     6.   CASH FLOW COVERAGE. Commencing with fiscal year 1997, the sum of
          Xxxxxxxx's net profit plus period depreciation divided by the current
          portion of long term debt and capitalized leases shall not be less
          than 1.5 times.

     7.   RECORDS AND REPORTS. Maintain a standard and modern system of
          accounting in accordance with generally accepted accounting
          principles on a basis consistently maintained; permit your
          representatives to have access to, and to examine its properties,
          books and records at all reasonable times; and furnish you:

          (a)  As soon as available, and in any event within 45 days after the
               close of each quarter of each fiscal year of Borrower,
               commencing with the quarter next ending, a balance sheet, profit
               and loss statement and reconciliation of Xxxxxxxx's capital
               accounts as of the close of such period and covering operations
               for the portion of Borrower's fiscal year ending on the last day
               of such period, all in reasonable detail and stating in
               comparative form the figures for the corresponding date and
               period in the previous fiscal year, prepared in accordance with
               generally accepted accounting principles on a basis consistently
               maintained by Borrower and certified by an appropriate officer
               of Borrower, subject, however, to year-end audit adjustments.

          (b)  As soon as available, and in any event within 120 days after the
               close of each fiscal year of Borrower, a report of audit of
               Company as of the close of and for such fiscal year, all in
               reasonable detail and stating in comparative form the figures as
               of the close of and for the previous fiscal year, with the
               unqualified opinion of accountants satisfactory to you, or no
               third party opinion required.

          (c)  Within 90 days after the end of each fiscal year of Borrower, a
               certificate of chief financial officer of Xxxxxxxx, stating that
               to the actual knowledge of such officer, Xxxxxxxx has performed
               and observed all material covenants on its part required to be
               performed by it except where the failure to so perform or
               observe would have a material adverse effect on the financial
               condition, operations or business of Borrower,

          (d)  Promptly after the receipt thereof by Borrower shall send to its
               stockholders, if any, and copies of all reports which Borrower
               may file with the Securities and Exchange Commission or any
               governmental authority at any time substituted therefor, and

          (e)  Such other information relating to the affairs of Borrower as
               you reasonably may request from time to time.

          (f)  Notice of Default. Promptly notify the Bank in writing of the
               occurrence of any event of default hereunder or any event which
               upon notice and lapse of time would be an event of default.

               X.   Xxxxxxxx agrees that so long as it indebted to you, it will
               not, without your written consent:

               1.   TYPE OF BUSINESS; MANAGEMENT; EXECUTIVES' COMPENSATION.
                    Make any substantial change in its business or operations
                    or make any change in incumbency of Xxxx X. Xxxxxxx as
                    chairman and Chief Executive Officer of Borrower or of
                    Xxxxx X. Xxxx as President of Borrower.

               2.   DIVIDENDS, STOCK PAYMENTS. If a corporation, declare or pay
                    any dividend (other than dividends payable in common stock
                    of Borrower) or make any other distribution on any of its
                    capital stock now outstanding or hereafter issued or
                    purchase, redeem or retire any of such stock; except,
                    however, 100% of net after tax earnings for such dividend
                    period excluding the retirement or redemption of the
                    approximately 700,000 shares of Common Stock of Borrower
                    being repurchased and Borrower may pay cash dividends to its
                    shareholders so long as no default shall have occurred
                    hereunder and remained uncured.





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D. The occurrence of any one of the following events of default shall, at your
   option, terminate your commitment to lend and make all sums of principal and
   interest then remaining unpaid on all Borrower's indebtedness to you
   immediately due and payable, all without demand, presentment or notice, all
   of which are hereby expressly waived:

1. FAILURE TO PAY NOTE. Failure to pay any installment of principal or of
   interest on any indebtedness of Borrower to you within 10 days of the date
   when due.

2. BREACH OF COVENANT. Failure of Borrower to perform any other term or
   condition of this Agreement binding upon Borrower, which failure continues
   and is not cured within thirty days after written notice from Bank to
   Borrower.

3. BREACH OF WARRANTY. Any of Borrower's representations or warranties made
   herein or any statement or certificate at any time given in writing pursuant
   hereto or in connection herewith shall be false or misleading in any material
   respect.

4. INSOLVENCY, RECEIVER OR TRUSTEE. Borrower shall become insolvent; or admit
   its inability to pay its debts as they mature; or make an assignment for the
   benefit of creditors; or apply for or consent to the appointment of a
   receiver or trustee for it or for a substantial part of its property or
   business.

5. JUDGMENTS, ATTACHMENTS. Any money judgment, writ or warrant of attachment, or
   similar process shall be entered or filed against Borrower or any of its
   assets, which judgment, writ or warrant of attachment or similar process will
   have a material adverse effect on the financial condition, operations and
   business of Borrower and which remains unvacated, unbonded, or unstayed for a
   period of 30 days or in any event later than five days prior to the day of
   any proposed sale or execution under such judgment, writ, warrant of
   attachment or similar process.

6. BANKRUPTCY. Bankruptcy, insolvency, reorganization or liquidation proceedings
   or other proceedings for relief under any bankruptcy law or any law for the
   relief of debtors shall be instituted by or against Borrower and, if
   instituted against it, shall be consented to.

E. Miscellaneous Provisions

1. FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on the part of your
   Bank or any holder of Notes issued hereunder, in the exercise of any power,
   right or privilege hereunder shall operate as a waiver thereof, nor shall any
   single or partial exercise of any such power, right or privilege preclude
   other or further exercise thereof or of any other right, power or privilege.
   All rights and remedies existing under this agreement of any note issued in
   connection with a loan that your Bank may make hereunder, are cumulative to,
   and not exclusive of, any rights or remedies otherwise available.

2. NOTICES. All notices, demands, requests or other communications that may be
   or are required to be given, served, or sent by any party to any other party
   pursuant to this agreement shall be in writing and shall be mailed by
   first-class registered or certified mail, return receipt requested, postage
   prepaid, or transmitted by hand delivery, with signature required by
   recipient, addressed as follows:

   Notices to Borrower:

               Xxxxx X. Xxxx, President
               National Insurance Group
               000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx 000
               Xxxxx Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-1933

   With a copy (which shall
   not constitute notice) to:

               Xxxxxx X. Xxxxxxxxxxx
               Executive Vice President and General Counsel
               000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx 000
               Xxxxx Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-1933

   Notices to Bank:

               Xxxxxx X. XxXxxxxx, Vice President
               Imperial Bank
               000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
               Xxx Xxxxxxxxx, Xxxxxxxxxx 00000

Each party may designate by notice in writing a new address to which any notice,
     demand, request or communication may thereafter be so given, served or
     sent. Each notice, demand, request or communication that is mailed shall be
     deemed sufficiently given, served, sent, and received for all purposes at
     such time as it is delivered to the addressees (with the return receipt,
     the delivery receipt, the affidavit of messenger being conclusive evidence
     of such delivery) or at such time as delivery refused by the addressees
     upon presentation.



                                                  
Agreed to and Accepted:                          Agreed to and Accepted
National Insurance Group                         Imperial Bank

By: /s/ XXXXXX X. XXXXXXXXXXX  Date 9/10/96      By: /s/ XXXXXX X. XxXxxxxx  Date: 9/10/96
    -------------------------       -------          ----------------------        -------
      (Signature and Title)                          (Signature and Title)
      Xxxxxx X. Xxxxxxxxxxx   
      Executive Vice President

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By /S/ X.X. XXXXXXX                      Date   9/10/96            By                                        Date
  -------------------------------------       ------------------     -------------------------------------        ------------------
  (Signature and Title)
   Vice President & Treasurer