
<PAGE>   1
                                                                EXHIBIT 10(c)(1)

                                LOAN AGREEMENT


        This Loan Agreement dated the 26th day of May, 1994, is made by and
between FIRST NATIONAL BANK OF BRYAN, Bryan, Texas ("Lender") whose address is
2807 Texas Avenue South, Bryan, Brazos County, Texas, and BODYBILT SEATING,
INC., a Texas Corporation whose address is 4455 Carter Creek Parkway, Bryan,
Brazos County, Texas 77802, (herein collectively referred to as "Borrower"),
AND MARK A. McMILLAN, whose address is 4455 Carter Creek Parkway, Bryan, Brazos
County, Texas (herein collectively referred to as "Guarantor") relative to a
loan ("Loan" or "loan") in the principal sum of FIVE HUNDRED SEVENTY-ONE
THOUSAND FIVE HUNDRED AND NO/100 DOLLARS ($571,500.00) from Lender to Borrower.

                             I. TERMS OF THE LOAN

        1.1  Commitment of Lender.  Subject to and upon the terms, covenants and
conditions hereof, Lender hereby agrees to lend to Borrower up to an aggregate
sum not to exceed FIVE HUNDRED SEVENTY-ONE THOUSAND FIVE HUNDRED AND NO/100
DOLLARS ($571,500.00) in accordance with this Loan Agreement, which loan shall
be evidenced by a Promissory Note ("Note") of such form and substance as Lender
shall require and secured by such collateral as hereinafter provided.  Such
loan shall be advanced for the following purposes:


        (1)     The sum of FOUR HUNDRED FIFTEEN THOUSAND AND NO/100 DOLLARS
                ($415,000.00) shall be advanced for the purchase price of that
                certain real property and improvements located in Grimes County,
                Texas, and being more particularly described on Exhibit "A"
                ("Property") attached hereto and made a part hereof, which
                purchase shall be made pursuant to that certain Contract of Sale
                and Purchase dated the 5th day of April, 1994, entered into by
                and between PFL LIFE INSURANCE COMPANY, as Seller, and Borrower,
                as Buyer; and

        (2)     The sum of ONE HUNDRED FIFTY-SIX THOUSAND FIVE HUNDRED AND
                NO/100 DOLLARS ($156,500.00) or so much as may be advanced by
                Lender to Borrower herein from time to time during the term of
                the Loan for the purpose of paying for the costs of labor
                performed and materials furnished to Borrower for the
                construction, repair, remodelling, and generally improving the
                buildings, structures and other improvements located on the
                Property described on Exhibit "A" attached hereto, such
                advancements to be made by Lender to Borrower at such times, and
                subject to the provisions of this Agreement, including
                specifically paragraphs 2.2, 2.3, 2.4, 2.5 and 2.6 of article II
                herein.

        1.2     Interest on the Loan.  Interest on the loan shall be at the
rate of prime plus one and one-fourth percent (1.25%) as specified in the Note,
shall be computed on the unpaid principal balance which exists from time to
time and shall be computed on the basis of Texas Commerce Bank, Houston, Harris
County, Texas, prime rate, floating from day to day, based upon and calculated
on three hundred sixty (360) day accrual rate.

        1.3     Origination Fee.  On the closing date of this loan, Borrower
shall pay to Lender an origination fee in the amount of TWO THOUSAND EIGHT
HUNDRED FIFTY-SEVEN AND 50/100 DOLLARS ($2,857.50), being one-half percent
(1/2%) of the original principal amount of the Note.  In the event, only a part
or portion of the $571,500.00 is advanced during the term of the Loan, then
Lender shall refund to Borrower the appropriate amount of the fee based upon the
total amount of the loan funded.

        1.4     Payments of Note.  Interest only shall be due and payable
monthly as it accrues on the unpaid balance of the Note each month, with the
first installment of interest being due and payable thirty (30) days from date
of the first advance by Lender to Borrower of sums under the Promissory Note,
and on




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the same day of each calendar month thereafter, until the 26th day of May,
1995, when all unpaid accrued interest shall be due and payable in full.  The
principal amount of said Note shall be due and payable in full on or before May
31, 1995.

          II. CONDITIONS TO ADVANCEMENT OF THE FUNDS UNDER THE LOAN

        As conditions precedent to the advancement of funds by Lender to
Borrower or for the benefit of the Borrower, Borrower must satisfy the
following terms and conditions:

        2.1     For Funding $415,000.00.  Lender shall fund to Borrower and/or
for the benefit of Borrower, the sum of FOUR HUNDRED FIFTEEN THOUSAND AND
NO/100 DOLLARS ($415,000.00) for the purchase of the Property described on
Exhibit "A" ("Property") from the Seller, PFL Life Insurance Company, an Iowa
Corporation.  Upon Lender being in receipt of the following, all in the form
and substance satisfactory and approved by Lender and Lender's attorney:

        (1)     Promissory Note in the original principal sum of $571,500.00,
                executed by Borrower (the "Note") evidencing the Loan, made
                payable to Lender and a Guaranty Agreement executed by Guarantor
                guaranteeing the Note in such form and substance and approved by
                Lender;

        (2)     Deed of Trust/Security Agreement - Financing Statement (the
                "Deed of Trust") executed by Borrower covering the property
                described on Exhibit "A" and all improvements, whether now or
                existing or hereafter constructed thereon securing the Note;

        (3)     Assignment of Rents, Leases and Other Benefits executed by
                Borrower relative to the tenant leases as to any part or
                portion of the Property described on Exhibit "A" now existing or
                hereafter existing, including the Lease dated May 24, 1979,
                executed by and between Brookshire Brothers, Inc., as Lessee,
                and all amendments and addendums thereto;

        (4)     The original Lease instrument by and between Brookshire
                Brothers, Inc., as Lessee and Quinten McLemore, as Lessor,
                dated May 24, 1979, with all amendments and addendums thereto,
                the original Assignment of the same from PFL Life Insurance
                Company to Borrower and a letter from Borrower to Brookshire
                Brothers, Inc. directing that all rental payments and all other
                charges required to be paid under the Lease, be paid directly to
                Lender.

        (5)     Subordination of Leases to the Deed of Trust of Lender executed
                by Brookshire Brothers, Inc. as to the Lease described in
                paragraph (4) as well as an Estoppel Certificate of such form
                and substance as approved by Lender.

        (6)     Survey and a plat, certified by a duly licensed surveyor,
                acceptable to Lender, surveyed on the ground, with flood plain
                designations, easements, boundary lines and overlapping or
                encroachments of improvements on the Property, building setback
                lines, and any other conditions affecting the Property with a
                certificate and seal of the surveyor acceptable to Lender and
                the Title Company;

        (7)     Security Agreement and UCC-1 Financing Statements ("Security
                Agreements") executed by Borrower covering equipment, personal
                property and other items requested by Lender, which are on the
                Property or in the building or improvements located on the
                Property or which may relate to the Property and/or the personal
                property used or to be used in or in connection with the
                Property and/or the




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Loan Agreement (Bodybilt)


                operation of the Property and UCC-1 Financing Statements
                relative thereto, to be properly recorded in the Secretary of
                State's Office and the UCC (Personal Property) Records of Grimes
                County, Texas; 

        (8)     Such other documents executed by Borrower and matters as Lender
                may require in connection with this Loan.

        (9)     Insurance policies for or other evidence acceptable to Lender
                of public liability insurance, and fire and extended coverage
                insurance relative to the improvements on the Property in such
                amounts and insured by such companies as are acceptable to
                Lender;

        (10)    Mortgagee's Title Policy issued by Alamo Title Insurance of
                Texas for $571,500.00 under Title Commitment GF#313181, with
                paragraphs 1 and 2 under Schedule B being deleted, and naming
                Lender as the insured issued through American Title Company,
                Dallas, Texas ("Title Company").

Items in paragraphs (1) through (10) are hereinafter collectively referred to
as "Loan Documents".

        2.2     For Funding the Remainder sum of $156,500.00.  Conditions
precedent to the advancement of the funds by Lender to Borrower relative to the
$156,500.00 for purposes of paying for the costs of labor performed and
materials furnished on the Property, the Buildings and Improvements located
thereon, for the repair, construction, remodelling, alteration and modification
thereof, Lender shall be in receipt of the following from Borrower:

        (1)     The items required under paragraph 2.1;

        (2)     Copies of all licenses, permits, approvals and other
                authorizations, if any, which may be required by the laws,
                statues, rules or regulations of any governmental authority or
                private authority, if any, having jurisdiction over the
                Property described on Exhibit "A", and over the construction,
                remodelling, repairs and improvements thereon (collectively
                "Permits").

        (3)     The plans, specifications and cost projections for the repair,
                construction, remodelling, modification, of the buildings and
                improvements located on the Property, which plans and cost
                projections are in form and content satisfactory to Lender and
                the same are approved by Lender in writing.

        (4)     Builder's risk hazard insurance providing all risk coverage
                (including all perils of collapse) on the building and
                improvements including the materials stored on the Property or
                elsewhere, and public liability insurance and workmen's
                compensation insurance for the Borrower and any contractors or
                subcontractors in such amounts and from such insurance carriers
                as are approved by Lender.

        (5)     The sum of $63,500.00 cash on deposit with Lender to be funded
                to pay for the cost of labor and materials prior to any part of
                the $156,500.00 is funded by Lender.

        2.3     Deposits of Borrower.  Upon approval of the plans,
specifications and costs projects submitted by Borrower, Lender agrees to
advance to Borrower for such costs up to $156,500.00 subject to Borrower
depositing with Lender a sum of cash, as Lender may request, not to exceed a
total of $63,500.00.  The deposit requested shall be based upon such approved
costs and the specified amount of the $156,500.00 Borrower requests Lender to
fund.  Provided however,




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Loan Agreement (Bodybilt)


Lender shall not fund any portion of the Loan until such time as Borrower's
deposit has been made with Lender, and the deposit has been advanced to pay for
the costs of labor and materials.  The advancement of such deposits for payment
of costs shall be made by Lender and such advancements shall be subject to the
same terms and conditions specified in this agreement for advancement of any
portion of the $156,500.00.

        2.4     Advances for Payment of Labor Performed and Materials
Purchased.  Lender agrees to advance up to ONE HUNDRED FIFTY-SIX THOUSAND FIVE
HUNDRED AND NO/100 DOLLARS ($156,500.00) to Borrower in monthly draws, upon the
receipt of a fully completed and executed request for advance in the form and
substance as may be required by Lender, together with a fully completed and
executed draw package, containing such items and documents which Lender may
request, which may include the following:

        (1)     Originally signed Request for Advance for Draw, requesting the
                advance and setting forth the amount thereof;

        (2)     An overall budget schedule, including invoices for all costs
                and expenses for labor and material furnished and/or purchased
                for which the advance is being requested;

        (3)     Approval by Lender of the work completed and inspected by
                Lender, or Lender's agents and representatives;

        (4)     And such other forms and documents which the Lender may
                reasonably require relating to the costs and expenses incurred
                by Borrower relative to the purchase of materials and the
                payment of labor performed.

        Prior to advancement, the Borrower must provide to Lender satisfactory
evidence that all previous bills for labor and materials have been paid, and
that there are no mechanic's and/or materialmen's liens and/or affidavits or
claims filed against the Property by the contractor and/or subcontractors.

        The proceeds of the loan shall be advanced on the dates requested and
approved by the Lender, and shall only be made for work completed preceding the
date of the request, less any retainage required by Lender and/or provided in
Borrower's construction contract, shall be submitted to the Lender, a
reasonable time before the date upon which the advance is desired, and shall be
accompanied by certificates signed by the Borrower and the contractor or
subcontractors (if required by Lender), stating and satisfactorily evidencing
that the Borrower and the contractor have paid all bills incurred for labor
done, materials furnished and equipment used in connection with the work
performed to that date.  The amount of each advance of the Loan shall be the
amount of the payment of the contract price and/or invoice which is payable to
the contractor and/or subcontractors as approved by the Lender, and such
amounts shall be advanced under the Loan on behalf of the Borrower.  All
advances shall be evidenced by check issued jointly to the Borrower and the
contractor and subcontractors unless otherwise approved by Lender, and all
advances shall be preceded with an inspection of the Property by the Lender or
Lender's agents prior to funding.

        The final advance shall be payable upon the expiration of thirty (30)
days from the date of final completion of the repairs and improvements, and
acceptance by Lender.  Provided however, the same shall not be considered
complete unless and until all of the work requiring inspection by Lender and
any municipal or other governmental authorities having jurisdiction has been
duly inspected and approved by such entities and authorities, and by the
inspecting architect, if any, and all requisite certificates of occupancy and
other approvals have been duly issued.  Provided further, that Lender may
withhold approval of final
     


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Loan Agreement (Bodybilt)



payment until after evidence satisfactory to Lender shall have been presented
to Lender showing payment in full of all obligations incurred in connection
with the construction and completion of the repairs and improvements and
Borrower and all contractors and subcontractors of Borrower have furnished to
Lender an affidavit of all bills paid in the form acceptable to Lender, that
they are waiving and releasing any lien claims against the Property, together
with an affidavit of completion executed by contractor and/or subcontractors
and by Borrower.

        Upon demand by Lender, Borrower shall deposit with Lender such sums as
Lender may deem necessary and in addition to the Loan and deposits required
under 2.3 for the completion and payment of all costs in connection with the
construction of the Improvements and for the performance of the obligations of
Borrower to Lender in the event, Lender deems its position and the payments of
all obligations to be insecure.

        2.5     Work Completion.  Lender has no liability, obligation or
responsibility whatsoever with respect to the work related to the construction
of the Improvements except to advance proceeds of the Loan as herein agreed. 
Lender is not obligated to inspect the Improvements or the construction
thereof, nor is Lender liable for the performance or default of any contractor
or subcontractor or for any failure to construct, complete, protect or insure
the improvements or for the payment of any cost or expense incurred in
connection therewith, or for the performance or non-performance of any
obligation of Borrower to such parties; and nothing, including without
limitation, any disbursement hereunder or the deposit or acceptance of any
document or instrument shall be construed as a representation or warranty,
express or implied, on Lender's part.

        The obligations arising out of any contract, between a contractor
and/or subcontractors and Borrower, are separate and independent of any
obligations arising hereunder.  Any claim, defense or right of offset which
Borrower may have against a contractor or subcontractors, or any dispute or
legal proceeding between Borrower and a contractor and/or subcontractor, shall,
in no event, be asserted by Borrower against Lender in connection with the
Loan, this Agreement, or in any action or proceeding to enforce or collect
under this Agreement, the Note or the Security Agreement.

        If the repairs and the improvements fail, for any reason, to be
completed pursuant to the plans, specifications, costs estimates and/or
contracts submitted by Borrower to Lender, then Lender shall have the right,
but no obligation, to complete the repairs and improvements and any lien and
security interests granted under contracts and/or the law, shall inure to the
benefit of the Lender.  Any contractor and/or subcontractor shall remain
obligated to Borrower to perform its obligations under any contract, until
completed.  Provided however, Lender shall not be responsible to any contractor
or subcontractor for the payment or performance of any obligations of Borrower
under any contracts or the contractor's documents.

        2.6     Inspection by Lender.  Lender's representatives shall have the
right to inspect the repairs and improvements upon the Property at any time,
determine whether the work is being performed satisfactorily and constructed in
a good, workmanlike manner, in accordance with the Plans, Specifications and
any contracts.  Borrower shall pay for any costs and expenses incurred by
Lender in hiring and retaining an inspector to inspect the Property.  If
Lender's inspections reveal that the work has not been satisfactorily
constructed in a good, workmanlike manner in accordance with the plans and the
contract, or that the estimated costs and completion of the work yet to be
performed is under-estimated, then Lender may (i) notify Borrower in
writing of the deficiencies in the work and the requirements to remedy said
deficiencies so that the work


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Loan Agreement (Bodybilt)



will comply with the plans and the contract; (ii) cease to make further
advances of the Loan until such time as Borrower satisfactorily remedies the
deficiencies in the work to the satisfaction of the Lender.  Lender shall not
be responsible in any way with regard to the quality of the construction, the
materials used or the workmanship incorporated into the Improvements.

               III.  REPRESENTATIONS AND WARRANTIES OF BORROWER

        Borrower hereby represents and warrants, which representations and
warranties shall survive the closing, as follows:

        a.      That as of the date hereof, no work of any kind has been or
                will be commenced or performed upon the Property; no material or
                equipment has been or will be delivered upon the Property, and
                no construction contract other than the mechanic's and
                materialmen's contract has been executed and recorded in
                connection with any of the Improvements contemplated to be
                constructed on the Property;

        b.      No hazardous materials are located on the Property or have been
                released into the environment or deposited, discharged, placed,
                or disposed of at, on, under or near the Property;

        c.      No portion of the Property is being used, or to the knowledge
                of Borrower, has been used at any previous time for disposal,
                storage, treatment, processing or other handling of hazardous
                materials, nor has the Property been effected by any hazardous
                material contaminates; no investigation, administrative order,
                consent or agreement, litigation or settlement with respect to
                hazardous materials or hazardous material contaminates is
                proposed, threatened, anticipated, or in existence with respect
                to the Property, nor does the Borrower have any knowledge that
                the same has ever existed with respect to the Property;

        d.      There are no actions, suits or proceedings pending or to the
                knowledge of Borrower, threatened in any court or before or by
                any governmental authority, against or affecting Borrower or the
                Property;

        e.      Borrower holds or will hold full, legal and fee simple title to
                the Property, subject only to those title exceptions set forth
                in the title insurance binder issued by American Title Company
                prior to the date thereof;

        f.      Borrower is a Texas corporation, validly existing and in good
                standing under the laws of the State of Texas, and has full
                power, authority and legal right to enter into the loan and
                grant liens and security interests in the collateral and
                properties required by Lender to secure the Loan.  The Borrower
                and its President, Mark A. McMillan, are duly authorized and
                empowered to execute the Note, and other loan documents
                specified herein and requested by Lender.  All action on the
                part of the Borrower, as a requisite to the creation, issuance,
                execution and delivery of the Note and the loan documents has
                been duly and effectively taken.

        g.      That Financial Statements Borrower has submitted to Lender are
                true, correct and complete as of the date specified therein,
                and fully and accurately present the financial condition of
                Borrower, as of the date specified.  No material adverse change
                has occurred in the financial condition of Borrower since the
                date of the financial



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Loan Agreement (Bodybilt)

                statement.

        h.      That consummation of the transaction contemplated hereby and
                the performance of any of the terms and conditions hereof, and
                of other loan instruments, will not result in the breach of, or
                constitute a default in, any mortgage, deed of trust, lease,
                promissory note, loan agreement, credit agreement, bylaws,
                partnership agreement, or other agreement to which Borrower or
                Guarantor is a party, or by which Borrower or Guarantor may be
                bound or affected.  Neither Borrower nor the Guarantor is in
                default of any order of any court or any requirement of any
                governmental authority or any advance rule or policy of any
                governmental entity or any ordinance, rule or policy of any
                governmental entity.

        i.      There is no fact that Borrower has not disclosed to Lender in
                writing that could materially adversely affect Borrower or any
                of the property which will secure the Note herein described, or
                the properties, business or financial condition of Borrower, or
                the Guarantor hereunder.

        j.      The loan documents executed by Borrower constitute legal, valid
                and binding obligations of the Borrower.  Each of the loan 
                documents is enforceable against the obligor thereunder in 
                accordance with its terms.

        k.      There exists no default by Borrower, or any one of them, with
                respect to any order, writ, injunction or decree of any court or
                federal, state, municipal or other governmental department,
                commission, bureau, board, agency or municipality, relative to
                the Property and/or Collateral securing Borrower's Note.

                            IV.  EVENTS OF DEFAULT

        The following shall be considered an event of default under this
Agreement:

        a.      Failure of Borrower to make timely payments of any instalment
                of principal and/or interest under the Note, or any other
                obligation of Borrower to Lender, evidenced by the Loan
                documents when due and payable, whether at maturity or
                otherwise;

        b.      Failure of Borrower to perform any of the terms, covenants or
                agreements contained herein or any security agreement, deed of
                trust, promissory note, assignment of rents and leases, or other
                instrument securing payment of this Loan of Borrower to Lender;

        c.      If any representation or warranty herein contained or in any
                financial statement, report, or document submitted by Borrower
                and/or Guarantor to Lender in connection with this Loan shall
                prove to be untrue, incorrect or misleading in any material
                respect when made; or

        d.      If any judgment, attachment, levy, mechanic's or materialmen's
                lien affidavits, or claim of any kind is made against the
                Borrower and/or the Property and such judgment, levy,
                attachment, claim or mechanic's or materialmen's lien affidavit
                remains there and is not removed for a period of thirty (30)
                days; or

        e.      If Borrower and/or Guarantor makes an assignment for the
                benefit of creditors, admits in writing its inability to pay 
                its debts generally






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Loan Agreement (Bodybilt)



                as they become due, files a petition in bankruptcy, is
                adjudicated insolvent or bankrupt, petitions or applies to any
                tribunal for a receiver or a trustee for Borrower and/or
                Guarantor or for any substantial part of Borrower's and/or
                Guarantor's assets and/or Property, or Borrower commences any
                action or someone commences an action against Borrower under an
                reorganization, arrangement, readjustment of debt, dissolution
                or liquidation under law or statute in any jurisdiction, whether
                now or hereafter in effect, or if there is commenced against
                Borrower and/or Guarantor, any such action, or Borrower and/or
                Guarantor, by any act, indicates its consent to or approval of
                any such action against Borrower and/or Guarantor or any
                substantial part of Borrower's and/or Guarantor's assets and/or
                Property.

        Should a default occur Lender may, in addition to any other remedies
granted in the Note, Deed of Trust/Security Agreement-Financing Statement,
Assignment of Rents and Leases, Security Agreement, UCC-1 Financing Statements,
or any other security instruments and documents which have been executed by
Borrower and delivered to Lender with respect to this Loan, or which Lender may
be entitled to at law or in equity, Lender may, at its election, do any one or
more of the following:

        a.      Declare the Note and any part thereof, immediately due and
                payable, whereupon it shall be due and payable, without notice
                of any kind, including but not limited to, notice of intention
                to accelerate, notice of acceleration, demand for payment, which
                are all hereby waived by Borrower;

        b.      Terminate Lender's commitment to lend and any obligation to
                disburse and advance any further funds to Borrower under the 
                Loan;

        c.      Demand payment in full from Guarantor of the unpaid balance on
                the Note owed by Borrower;

        d.      Reduce any indebtedness owed by Borrower and/or Guarantor to
                judgment;


        e.      Exercise any and all rights afforded by the Loan, the Note,
                Deed of Trust, Security Agreement, Assignment of Rents and
                Leases, and any and all other security instruments or
                documentation relative to this Loan;

        f.      Purchase and charge to Borrower and/or Guarantor any amount for
                a bond or bonds necessary to remove any claims or liens from
                the Property which have been filed, by any contractor,
                subcontractor, or materialmen or any other person or entity,
                against the Property, prior to and/or during the term of this
                Loan and during the construction of the Improvements on the
                Property.

                            V. FINANCIAL CONDITION

        During the term of this loan, Borrower and Guarantor hereby agree to
provide Lender with such information as Lender may reasonably request from time
to time regarding the financial condition of Borrower and any guarantor. 
Borrower and Guarantor hereby authorize Lender to obtain such financial
information from others.  In the event such information or an independent
investigation by Lender discloses a material adverse change in the financial
condition of Borrower and/or Guarantor or any one of them, or in the status of



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any of the Collateral, and/or the Property, or the operation of Borrower's
business, then, at Lender's option, should Lender in Lender's sole judgment
feel insecure, such may be considered a default under the terms and conditions
of this Loan Agreement, the Note, Deed of Trust, and all Security Instruments,
and Lender shall have the right to accelerate the maturity of the Promissory
Note herein and demand payment in full thereof.

                         VI.  NO LIABILITY OF LENDER

        Lender shall have no liability, obligation or responsibility whatsoever
with respect to the Loan.

        Nothing, including without limitation any advance or acceptance of any
document or instrument, shall be construed as a representation or warranty,
express or implied, to any party by Lender.  Further, Lender shall not have,
has not assumed and by its execution and acceptance of this Agreement hereby
expressly disclaims any liability or responsibility for the payment or
performance of any indebtedness or obligation of Borrower and no term or
condition hereof, or of any of the documents securing the loan, shall be
construed otherwise.  Borrower hereby expressly acknowledges that no term or
condition hereof, or of any of the documents securing the Loan, shall be
construed so as to deem the relationship between Borrower, Guarantor and Lender
to be other than that of Borrower, Guarantor and Lender, and Borrower shall at
all times represent that the relationship between Borrower, Guarantor and
Lender is solely that of Borrower, Guarantor and Lender.  Borrower hereby
indemnifies and agrees to hold Lender harmless from any against any loss, cost,
expense or liability incurred or suffered by Lender as a result of any
assertion or claim of any liability or responsibility of Lender for the payment
or performance of any indebtedness or obligation of Borrower.

                       VII.  INDEMNIFICATION OF LENDER

        Borrower hereby expressly acknowledges and recognizes its
responsibility for and agrees to indemnify and hold Lender and Lender's
successors and assigns, absolutely harmless from and against all costs,
expenses, liabilities, loss, damage, or obligations incurred by or imposed upon
or alleged to be due of Lender or Lender's successors and assigns in connection
with the assertion of (a) any claim for brokerage, agency or finder's fees or
commissions in connection with the Loan or the Property; or (b) any claim for
attorney, appraisal, title insurance, inspection or other fees, costs and
expenses incurred in connection with the negotiation, closing, administration,
collection or refinancing of the Loan, which arise by, through or on behalf of
the Borrower or any agent or representative of any of them; or (c) any claim
arising out of or occurring because of or related to any Event of Default
thereunder.  Without intending to limit the remedies available to Lender with
respect to the enforcement of its indemnification rights as stated herein or as
stated in any of the documents securing the Loan, in the event any claim or
demand is made or any other fact comes to the attention of Lender in connection
with, relating or pertaining to, or arising out of the transactions
contemplated by this Loan Agreement, which Lender reasonably believes might
involve or lead to some liability of Lender, Borrower shall, immediately upon
receipt of written notification of any such claim or demand, assume in full the
personal responsibility for and the defense of any such claim or demand and pay
in connection therewith any loss, damage, deficiency, liability or obligation,
including without limitation, attorney's fees and court costs incurred in
connection therewith.  In the event of court action in connection with any such
claim or demand the Borrower shall assume in full the responsibility for the
defense of any such action and shall immediately satisfy and discharge any
final decree or judgment rendered therein.  The Lender may, in Lender's sole
and uncontrolled discretion, make any payments sustained or incurred by reason
of any of the foregoing, and the Borrower shall immediately



                                      9
<PAGE>   10

repay to Lender in cash the amount of such payment, with interest thereon at
the rate specified in the Note to be applicable after default thereunder.  The
Lender shall have the right to join the Borrower as a party defendant in any
legal action brought against Lender, and the Borrower hereby consents to the
entry of an order making Borrower a party defendant to any such action.

                             VIII.  DOCUMENTATION

        Borrower and Guarantor shall execute and deliver to Lender from time to
time as requested by Lender such documents and instruments which may be
reasonably necessary to provide the rights and remedies to Lender that are
provided for in this agreement.

                           IX.  GENERAL PROVISIONS

        No provision of this Agreement may be modified, waived, or terminated
except by instrument in writing, executed by the party against whom the
modification, waiver, or termination is sought to be enforced.

        If any one or more of the provisions of this Agreement, or the
applicability of any such provision to a specific situation, shall be held
invalid or unenforceable, such provision shall be modified, to the minimum
extent necessary to make it or its application valid and enforceable, and the
validity and enforceability of all other provisions of this Agreement and all
other applications of any such provision shall not be affected thereby.

        This Agreement and the loan documents and instruments shall be governed
and construed in accordance with the laws of the State of Texas, and the laws
of the United States applicable to the transaction within such State, and
shall be enforceable in Brazos County, Texas.

        Lender shall have all of the rights granted under the Promissory Note,
Deed of Trust, Security Agreements, and all other loan documents and security
instruments executed by Borrower and delivered to Lender, and all of those
available at law or in equity, and these same rights shall be cumulative and
shall be pursued separately, successively or concurrently against Borrower, or
any property covered under the Deeds of Trust or Security Agreements securing
this Loan, at the sole discretion of the Lender.  Exercise or failure to
exercise any of the same shall not constitute a waiver or release thereof, or
of any other right, and the same shall be non-exclusive.

        This Agreement shall inure to the benefit of the Lender herein,
Lender's successors and assigns, be binding upon the Borrower, Borrower's
successors and assigns.

        All notices, requests and communications hereunder shall be given in
writing and shall be delivered or mailed by first class, registered or
certified mail, postage pre-paid, return receipt requested, to the individuals
and addresses indicated below:

                IF TO BORROWER:

                        BOBYBILT SEATING, INC.
                        4455 Carter Creek Parkway
                        Bryan, Texas 77802


                                      10
<PAGE>   11
                        IF TO LENDER:

                                FIRST NATIONAL BANK OF BRYAN
                                ATTENTION:  Tim Bryan, C.E.O.
                                P.O. Box 833
                                Bryan, Texas 77805

                        IF TO GUARANTOR:

                                MARK A. McMILLAN
                                4455 Carter Creek Parkway
                                Bryan, Texas 77802


        Any notice provided for herein shall become effective only upon and at
such time of receipt by the party to whom it is given, unless such notice is
mailed by registered or certified mail, in which case it shall be deemed to be
received on the earlier of the second business day of Lender following the
mailing thereof, or the date of its receipt if such day is a business day of
Lender; or if not a business day, the first business day thereafter.  The party
may, by proper written notice hereunder, to the other parties, change the
individual address to which notices shall thereafter be sent.

        EXECUTED this the 26th day of May, 1994.

                                        BORROWER:

                                        BODYBILT SEATING, INC.

                                        By: /s/ MARK McMILLAN                  
                                            ------------------------------------
                                            Name:                          
                                            Title:                         


                                        GUARANTOR:

                                        /s/ MARK A. McMILLAN  
                                        ---------------------------------------
                                            MARK A. McMILLAN


                                        LENDER:

ATTEST:                                 FIRST NATIONAL BANK OF BRYAN

/s/ STEVE M. HUTTON                     By: /s/ TIM BRYAN                      
----------------------                      ------------------------------------
Name:                                       Name:                          
Title:                                      Title:                         




                                      11
<PAGE>   12
                                                                       EXHIBIT A
                                                               Page 1 of 2 Pages

                                 FIELD NOTES

 
All that certain tract or parcel of land lying and being situated in Grimes
County, Texas and being a part of the D. TYLER SURVEY, Abstract No. 55, also
being out of a called 15.00 acre tract described in a Deed from William D.
Bonham, Trustee, to Quinten McLemore dated May 8, 1979, of record in Vol. 378,
Page 460, Real Property Records of Grimes County, Texas and more fully
described as follows.

BEGINNING at a found 3/8 inch iron rod for the NE corner of called 15.00 acre
tract mentioned above in the West R.O.W. line of the State Highway #6 Bypass
Loop and the SE corner of a called 12.656 acre tract described in a Deed from
John Haynie Stoneham, et al, to Quinten McLemore dated May 13, 1981, of record
in Vol. 420, Page 639, Real Property Records of Grimes County, Texas.

THENCE S 8 deg. 57 min. 21 sec. E, 582.02 ft., along the West R.O.W. line of
the State Highway #6 Bypass Loop and East line of called 15.00 acre tract to a
found 3/8 inch iron rod for the SE corner of the tract of land herein
described.

THENCE S 81 deg. 35 min. 08 sec. W, 650.52 ft., along the South line of the
tract of land herein described to a set 1/2 inch iron rod for its SW corner.

THENCE N 8 deg. 57 min. 36 sec. W, 444.50 ft., along the West line of called
15.00 acre tract and West line of the tract of land herein described to a set
1/2 inch iron rod for its NW corner in the South line of called 12.656 acre
tract.

THENCE N 69 deg. 37 min. 37 sec. E, 663.66 ft., along the North line of called
15.00 acre tract and South line of called 12.656 acre tract to THE PLACE OF
BEGINNING CONTAINING 7.665 acres of land.


DATED this the 9 day of May, 1994

SIGNED: /s/ ROBERT LEE BOSSE, JR.
       ------------------------------------------
            Robert Lee Bosse, Jr.
            Registered Professional Land Surveyor
            State of Texas No. 3927 



<PAGE>   13
                                                                   EXHIBIT A
                                                               Page 2 of 2 Pages

                                  SURVEY MAP

The undersigned does hereby certify that this survey was this day made on the 
ground of the property located in Grimes County, Texas and being a part of the 
D. TYLER SURVEY, Abstract No. 55, also being out of a called 15.00 acre tract 
described in a Deed from William D. Bonham, Trustee, to Quinten McLemore, 
dated May 8, 1979, of record in Vol. 378, Page 460, Real Property Records of 
Grimes County, Texas, that there are no overlappings of improvements, 
encroachments, easements, except as shown hereon and that the property shown 
above as 7.665 acres is located within a Special Flood Hazard Area according to 
the Flood Hazard Boundary Map, Community Panel No. 480265 0005A, dated February 
4, 1988 for the City of Navasota, Texas. However, according to said Flood 
Hazard Boundary Map the property shown above is located in an Area known as 
Zone A and by the Legend on said Map there were no elevations run by The 
Federal Emergency Management Agency to determine the base Flood Elevations of 
the property shown above or any other Areas shown as Zone A.


DATED this the 9th day of May, 1994


SIGNED:   /s/ ROBERT LEE BOSSE, JR.                 
        --------------------------------------------------
              Robert Lee Bosse, Jr.
              Registered Professional Land Surveyor
              State of Texas No. 3927                              [SEAL]
