Note 7 – Credit Arrangements

At December 31, 2012 and 2011, the Company had the following outstanding debt:

				Outstanding Principal Balance
Instrument	Issue Date	Maturity Date		December 31, 2012		December 31, 2011
Promissory Note:
UTG	2006-12-08	2012-12-07	$	0	$	3,291,411
HPG Acquisitions	2007-02-07	2017-11-07		202,919		240,234
HPG Acquisitions	2012-12-27	2018-03-04		12,000,000		0

Instrument	Issue Date	Maturity Date		Revolving Credit Limit		December 31, 2011	Borrowings	Repayments		December 31, 2012
Lines of Credit:
UTG	2011-07-14	2012-12-07	$	5,000,000	$	1,000,000	1,411,000	2,411,000	$	0
UTG	2012-11-20	2013-11-20		8,000,000		0	2,910,035	1,255,000		1,655,035
UTG Avalon	2011-12-28	2013-01-03		5,000,000		5,000,000	0	0		5,000,000
UG	2010-12-28	2013-12-06		15,000,000		0	0	0		0

The UTG promissory note was secured by the pledge of 100% of the common stock of UG. The promissory note carried a variable rate of interest based on the 3 month LIBOR rate plus 180 basis points. Interest was payable quarterly and principal was payable annually beginning at the end of the second year. During the fourth quarter 2012, UTG repaid the outstanding principal balance of this note.

The HPG Acquisitions promissory note issued on February 7, 2007 bears interest at a fixed rate of 5%.

The HPG Acquisitions promissory note issued on December 27, 2012 is secured by real estate owned by HPG. The promissory note bears interest at a fixed rate of 4%. Interest is payable monthly. Principal is payable monthly beginning in the third year of the note.

UTG's line of credit issued on July 14, 2011 had a variable rate of interest based on the 90 day LIBOR rate plus 2.75 percentage points, but at no time would the rate be less than 3.25%. The collateral held on the above promissory note also secured this line of credit. This line of credit expired on December 7, 2012 and was replaced by a new line of credit.

UTG's line of credit issued November 20, 2012 replaced the line of credit that expired on December 7, 2012. The line of credit carries interest at a fixed rate of 3.75% and is payable monthly. As collateral, UTG has pledged 100% of the common voting stock of its wholly owned subsidiary, UG.

The UTG Avalon line of credit carries interest at a rate of 4.0% and is payable in two semi-annual payments. The UTG Avalon promissory note was renewed on January 3, 2013 and matures on January 3, 2014.

UG is a member of the Federal Home Loan Bank ("FHLB"). This membership allows the Company access to additional credit up to a maximum of 50% of the total assets of UG. To be a member of the FHLB, the Company was required to purchase shares of common stock of FHLB. Borrowing capacity is based on 50 times each dollar of stock acquired in FHLB above the "base membership" amount.

The consolidated scheduled principal reductions on the notes payable for the next five years are as follows:

Year		Amount

2013	$	1,686,621
2014		5,034,154
2015		382,395
2016		518,134
2017		542,470