Note 7 – Credit Arrangements

At December 31, 2014 and 2013, the Company had the following outstanding debt:

			Outstanding Principal Balance
Instrument	Issue Date	Maturity Date	December 31, 2014		December 31, 2013
Promissory Note:
HPG Acquisitions	12/27/2012	3/4/2018	$	0	$	12,000,000
UTG Avalon	12/29/2014	4/1/2018		4,400,000		0

Instrument	Issue Date	Maturity Date	Revolving Credit Limit		December 31, 2012		Borrowings	Repayments	December 31, 2013

Lines of Credit:
UTG	11/20/2013	11/20/2015	$	8,000,000	$	2,097,534	1,600,000	3,697,534	$	0
UTG Avalon	3/28/2013	3/28/2014		5,000,000		5,000,000	0	5,000,000		0

The HPG Acquisitions promissory note issued on December 27, 2012 was secured by real estate owned by HPG. The promissory note carried interest at a fixed rate of 4% and was payable monthly. Principal was payable monthly beginning in the third year of the note. This note was fully repaid in November of 2014 when the assets of HPG were sold.

The UTG Avalon promissory note issued on December 29, 2014 carries interest at a rate of 3.50 % with interest payable quarterly beginning in July of 2015. The interest is a variable rate that is equal to the lowest of the U.S. Prime Rates as published in the money section of the Wall Street Journal. The interest rate is subject to change monthly and any change in interest rate is effective the first day of the month following the rate change. Principal is due upon maturity of the note.

The UTG 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, Universal Guaranty Life Insurance Company ("UG"). During July of 2014, the Company borrorwed an additional $1,600,000 on the line of credit. The proceeds were used to purchase an interest in an aircraft. The Company made principal payments of $3,697,534 on the line of credit during 2014.

The UTG Avalon line of credit issued on March 28, 2013 carried interest at a rate of 4.00 % with interest payable monthly. The interest rate was a variable rate that was 0.50% above the lowest of the U.S. Prime Rates as published in the money section of the Wall Street Journal. The interest rate was subject to change monthly and changes in the interest rate were effective on the first day of the month following the rate change. This line of credit was repaid in December of 2014 and replaced by the promissory note described above.

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 Company had no borrowings on this line of credit during 2014 or 2013. The FHLB offers a wide range of borrowing options to its members. Since the Company did not utilize their FHLB line of credit during the past two years, the Company did not renew the line of credit. The Company has the capability of accessing the FHLB's various borrowing options shall the need arise at a later date.

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

Year	Amount

2015	$	0
2016		0
2017		0
2018		4,400,000
2019		0