Exhibit 10.1

AMENDMENT NO. 1 TO THE CREDIT AGREEMENT dated as of May 15, 2008 among LeapFrog
Enterprises, Inc., a Delaware Corporation (the “Borrower”), the banks, financial
institutions and other institutional lenders listed on the signature pages
hereof as the Lenders (the “Lenders”) and Bank of America, N.A., as agent for
the Lenders (the “Agent”).

PRELIMINARY STATEMENTS:

(1) WHEREAS, the parties hereto have entered into a Credit Agreement dated as of
November 8, 2005 (the “Credit Agreement”). Capitalized terms not otherwise
defined in this Amendment have the same meanings as specified in the Credit
Agreement.

(2) WHEREAS, the Borrower has requested that the Credit Agreement be amended as
provided herein.

(3) The Majority Lenders are, on the terms and conditions stated below, willing
to grant the request of the Borrower and the Borrower and the Majority Lenders
have agreed to amend the Credit Agreement as hereinafter set forth.

SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective as
of the date hereof and subject to the satisfaction of the conditions precedent
set forth in Section 2, hereby amended as follows:

(a) Section 1.1 is amended by (x) deleting the figure “$75,000,000” therein and
substituting therefor the figure “$100,000,000” and (y) inserting the words
“subject to increase as provided in Section 1.5,” before the words “the ‘Total
Facility’” in the parenthetical in the second line of such section.

(b) Section 1.5 is amended and restated in its entirety as follows:

“1.5 Increase in the Aggregate Commitments.

(a) The Borrower may, at any time and from time to time, by notice to the Agent,
request that the aggregate amount of the Commitments be increased by an
aggregate amount of up to $50,000,000 (each an ‘Accordion Increase’ and
collectively the ‘Accordion Increases’) to be effective as of the date upon
which the conditions set forth in Section 1.5(d) below are fulfilled to the
satisfaction of the Agent (each such date an ‘Accordion Effective Date’);
provided, however, that (i) in no event shall the aggregate amount of the
Commitments hereunder exceed $150,000,000, and (ii) no Default or Event of
Default shall have occurred and be continuing as of the date of such request or
as of any Accordion Effective Date, or shall occur as a result thereof.

(b) The Agent may, in its sole discretion, promptly notify the Lenders of a
request by the Borrower for an Accordion Increase, which notice shall include
the date by which Lenders wishing to participate in such Accordion Increase must
commit to an increase in the amount of their respective Commitments (each such
date a ‘Commitment Date’). Each Lender that is willing to participate in such
Accordion Increase (each an ‘Increasing Lender’) shall give written notice to
the Agent on or prior to the applicable Commitment Date of the amount by which
it is willing to increase its Commitment. If the Lenders notify the Agent that
they are willing to increase the amount of their respective Commitments by an
aggregate amount that exceeds the aggregate amount of such Accordion Increase,
such Accordion Increase shall be allocated among the Lenders willing to
participate therein in such amounts as are agreed between the Borrower and the
Agent.

 

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(c) Promptly following the applicable Commitment Date, the Agent shall notify
the Borrower as to the amount, if any, by which the Lenders are willing to
participate in the applicable Accordion Increase. If the aggregate amount by
which the Lenders are willing to participate in such Accordion Increase on the
applicable Commitment Date is less than the amount requested by the Borrower,
then the Borrower may extend offers to one or more Eligible Assignees to
participate in any portion of the Accordion Increase that has not been committed
to by the Lenders as of the Commitment Date; provided, however, that the
Commitment of each such Eligible Assignee shall be in an amount of $5,000,000 or
an integral multiple of $1,000,000 in excess thereof (or such lesser amounts as
may be necessary to cause the aggregate increase to equal the Accordion
Increase).

(d) On each Accordion Effective Date, each Eligible Assignee that accepts an
offer to participate in the applicable Accordion Increase in accordance with
Section 1.5(c) (each such Eligible Assignee being an ‘Assuming Lender’) shall
become a Lender party to this Agreement as of such Accordion Effective Date and
the Commitment of each Increasing Lender for such Accordion Increase shall be so
increased by such amount (or by the amount allocated to such Lender pursuant to
the last sentence of Section 1.5(b)) as of such Accordion Effective Date and the
Commitment of each Lender as set forth on Schedule 1 shall be adjusted
accordingly; provided, that on or before the initial Accordion Effective Date, a
Successful Syndication shall have been achieved and on or before each Accordion
Effective Date:

(1) all amendments to this Agreement deemed reasonably necessary by the Agent to
accomplish such Accordion Increase shall have been agreed by the parties hereto
and any Assuming Lenders;

(2) all necessary approvals shall have been obtained by each of the Increasing
Lenders, the Assuming Lenders and the Agent; and

(3) the Agent shall have received the following, each dated such date:

(A)(i) certified copies of resolutions of the Board of Directors of the Borrower
or the Executive Committee of such Board approving such Accordion Increase and
the corresponding modifications to this Agreement and (ii) if requested, an
opinion of counsel for the Borrower (which may be in-house counsel), in form and
substance satisfactory to the Agent;

(B) an assumption agreement from each Assuming Lender, if any, in form and
substance satisfactory to the Borrower and the Agent (each an ‘Assumption
Agreement’), duly executed by such Eligible Assignee, the Agent and the
Borrower; and

(C) confirmation from each Increasing Lender of the increase in the amount of
its Commitment in a writing satisfactory to the Borrower and the Agent.

On each Accordion Effective Date, upon fulfillment of the conditions set forth
in the immediately preceding sentence of this Section 1.5(d), the Agent shall
notify the Lenders (including, without limitation, each Assuming Lender) and the
Borrower, on or before 12:00 noon (San Francisco time), by telecopier, of the
occurrence of each Accordion Increase and shall record in the Register the
relevant information with respect to each Increasing Lender and each Assuming
Lender on such date. The Borrower shall prepay Loans on each Accordion Effective
Date to the extent necessary to cause the outstanding Loans to be ratable with
the Commitment of each Lender. This Section shall supersede the provisions of
Sections 3.5 and 11.1 as applicable.”

 

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(c) Section 2.5 is amended by deleting the number “0.25%” contained therein and
by replacing such number with “0.50%”.

(d) Section 3.5 is amended by inserting the words “subject to the last sentence
of Section 13.13,” after the word “second” in the 10th line thereof.

(e) Section 6.5(a) is amended by inserting the words “(as updated by Borrower
from time to time)” after the words “Schedule 6.5(a) to the Disclosure Letter”
in the first line of such Section.

(f) Section 6.5(b) is amended by (x) inserting the words “(as updated by
Borrower from time to time)” after the words “Schedule 6.5(b) to the Disclosure
Letter hereto” in the first line of such Section and (y) inserting the words “or
the date of any such updated Schedule, as the case may be,” after the words “the
date hereof” in the second and third lines of such Section.

(g) Section 6.24 is amended by (x) inserting the words “(as updated by Borrower
from time to time)” after the words “Schedule 6.24 to the Disclosure Letter” in
the first line of such Section and (y) inserting the words “or the date of any
such updated Schedule, as the case may be,” after the words “the Closing Date”
in the first and second lines of such Section.

(h) Section 7.8(a)(1)(B) is amended by inserting the words “except with respect
to any Domestic Subsidiary which is an Immaterial Subsidiary,” at the beginning
of such Section.

(i) Section 7.8(b) is amended by (x) inserting the words “first-tier” before the
word “Foreign” in the first line of such Section and (y) inserting the words
“(other than LF Macao Commercial Offshore Limited, LeapFrog Digital Technology
(Shenzhen), Company Limited, LF Edu-Tech China Co., Ltd. and any Foreign
Subsidiary which is an Immaterial Subsidiary)” after the word “Subsidiary” in
the first line of such Section.

(j) Section 7.14 is amended by (x) deleting the word “and” in the third line of
subsection (i); (y) inserting new subsection (j) to read as follows: “Debt in a
principal amount not in excess of $10,000,000 secured solely by certain auction
rate securities owned by the Borrower as of May 1, 2008; and”; and
(z) renumbering existing subsection (j) as new subsection (k).

(k) Section 7.19 is amended by (x) deleting the word “and” in the first line of
subsection (e); (y) inserting new subsection (f) to read as follows: “Liens on
auction rate securities owned by the Borrower as of May 1, 2008 to secure Debt
permitted under Section 7.14(j); and”; and (z) renumbering existing subsection
(f) as new subsection (g).

(l) Article 7 is amended by inserting a new Section 7.27 to read as follows:

“7.27 Proprietary Rights. Within ninety (90) days of the date of Amendment No. 1
to this Agreement, or such later date as the Agent may agree to in its sole
discretion, the Agent shall have received evidence, satisfactory to the Agent,
that the Borrower and each of the Guarantors has granted to the Agent for the
benefit of the Secured Parties a first priority security interest in all of the
Borrower’s or such Guarantor’s domestic Proprietary Rights and has executed all
documents and taken all other actions necessary as the Agent may deem necessary
or desirable to perfect such security interest.”

(m) Section 12.11(a) is amended by (x) deleting the word “or” before “(4)” in
the tenth line of such Section; (y) inserting new subsection (4) to read as
follows: “(4) consisting of auction rate securities which are pledged as
collateral in connection with financings referred to in Section 7.14(j); or”;
and (z) renumbering existing subsection (4) as new subsection (5).

 

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(n) Section 13.13 is amended by inserting at the end of such Section the words
“Notwithstanding anything in this Agreement to the contrary, any modification,
rescission, waiver, release or amendment to the Wachovia Fee Letter may be made
by a written agreement signed by the Borrower and a duly authorized
representative of Wachovia Capital Finance Corporation (Western) (‘WCFCW’),
without the necessity of the consent of any other Lender or of the Agent,
provided, that WCFCW shall provide to the Agent (i) written notification of any
such modification, rescission, waiver, release or amendment within two business
days of the effectiveness thereof and (ii) a summary of any increase in any
financial obligations of the Borrower thereunder as a result of such
modification, rescission, waiver, release or amendment and provided, further,
that to the extent any such modification, rescission, waiver, release or
amendment increases the financial obligations of the Borrower thereunder, all
such additional financial obligations shall constitute Obligations under the
seventh level for purposes of Section 3.5 and not Obligations under the second
level of such Section, unless such modification, rescission, waiver, release or
amendment has been consented to by the Majority Lenders.”

(o) Annex A is amended by deleting the definitions of “Borrowing Base”, “Loan
Documents”, “Majority Lenders” and “Maximum Revolver Amount” therein and
replacing them with the following definitions:

“ ‘Borrowing Base’ means, at any time, an amount equal to (a) the sum of
(A) eighty-five percent (85%) of the Net Amount of Eligible Accounts; plus
(B) the lesser of (i) sixty-five percent (65%) of Eligible Inventory,
(ii) eighty-five percent (85%) of the Net Orderly Liquidation Value of Eligible
Inventory and (iii) the Maximum Inventory Loan Amount plus (C) one hundred
percent (100%) of the amount of cash and Cash Equivalents collectively
maintained in the Borrowing Base Cash Collateral Account; minus (b) Reserves
from time to time established by the Agent in its reasonable credit judgment,
provided that in respect of clause (B) above, until (i) the receipt by the Agent
of a satisfactory third-party inventory appraisal, (ii) the completion of a
satisfactory field examination of the Inventory by the Agent, and (iii) the
perfection of the Agent’s security interests in the Eligible Inventory in a
manner satisfactory to the Agent, the advance rate in respect of Eligible
Inventory shall be 0%.”

“ ‘Loan Documents’ means this Agreement, the Security Agreement, the Mortgages,
the Wachovia Fee Letter, Subsidiary Guaranties, Disclosure Letter and any other
agreements, instruments, and documents heretofore, now or hereafter evidencing,
securing, guaranteeing or otherwise relating to the Obligations, the Collateral,
or any other aspect of the transactions contemplated by this Agreement.”

“ ‘Majority Lenders’ means at any date of determination Lenders whose Pro Rata
Shares aggregate more than 50%, provided, that if at any date of determination
there are two or more unaffiliated Lenders, Majority Lenders shall mean at least
two unaffiliated Lenders whose Pro Rata Shares aggregate more than 50%.”

“ ‘Maximum Revolver Amount’ means $100,000,000, subject to increase as provided
in Section 1.5.”

(p) Annex A is amended by inserting three new definitions in the appropriate
alphabetical order to read as follows:

“ ‘Immaterial Subsidiary’ means a Subsidiary whose total assets as of the fiscal
quarter immediately preceding the date of determination are less than $500,000;
provided, that at no time shall the aggregate amount of total assets as of the
fiscal quarter immediately preceding the date of determination for all
Immaterial Subsidiaries exceed

 

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$2,500,000; provided, further, that if the aggregate amount of total assets as
of the fiscal quarter immediately preceding the date of determination for all
Immaterial Subsidiaries exceeds $2,500,000, the Borrower shall immediately
identify to the Agent in writing one or more Subsidiaries which will no longer
be deemed ‘Immaterial Subsidiaries’ for purposes of this Agreement such that the
aggregate amount of total assets as of the fiscal quarter immediately preceding
the date of determination for the remaining Immaterial Subsidiaries does not
exceed $2,500,000.”

“ ‘Net Orderly Liquidation Value’ has the meaning customarily given to such term
by third-party appraisers.”

“ ‘Wachovia Fee Letter’ means that certain letter agreement dated on or about
May 14, 2008 between the Borrower and Wachovia Capital Finance Corporation
(Western).”

(q) Schedule 6.5(a), Schedule 6.5(b), Schedule 6.9, Schedule 6.11, Schedule
6.20, Schedule 6.23 and Schedule 6.24 are replaced in their entirety with new
Schedule 6.5(a), new Schedule 6.5(b), new Schedule 6.9, new Schedule 6.11, new
Schedule 6.20, new Schedule 6.23 and new Schedule 6.24, attached hereto as
Exhibit A (the “Amended Schedules”).

SECTION 2. Conditions of Effectiveness. This Amendment shall become effective
upon the satisfaction of each of the following conditions precedent:

(a) The Agent shall have received evidence that this Amendment has been duly
executed and delivered by the Borrower and the Majority Lenders and the Consent
annexed hereto executed by the parties thereto.

(b) The representations and warranties contained herein and in the Credit
Agreement shall be true and correct in all material respects as of the date
hereof as if made on the date hereof after giving effect to this Amendment and
the Amended Schedules (except for those which by their terms specifically refer
to an earlier date, in which case such representations and warranties shall be
true and correct in all material respects as of such earlier date).

(c) No Default or Event of Default shall have occurred and be continuing after
giving effect to this Amendment.

SECTION 3. Representations and Warranties of the Borrower. The Borrower hereby
represents and warrants to the Agent and the Lenders that, as of the date hereof
and after giving effect to this Amendment and the Amended Schedules, (a) all
representations and warranties set forth in the Credit Agreement are true and
correct in all material respects as if made again on and as of such date (except
for those which by their terms specifically refer to an earlier date, in which
case such representations and warranties shall be true and correct in all
material respects as of such earlier date), (b) no Default or Event of Default
has occurred and is continuing and (c) the Credit Agreement (as amended by this
Amendment) and all other Loan Documents are and remain legal, valid, binding and
enforceable obligations of the Loan Parties in accordance with the terms thereof
except as may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors’ rights generally or by
equitable principles (regardless of whether enforcement is sought in equity or
at law).

SECTION 4. Reference to and Effect on the Loan Documents.

(a) On and after the effectiveness of this Amendment, each reference in the
Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words of like
import referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement, as amended by this Amendment.

 

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(b) The Credit Agreement and each of the other Loan Documents, as specifically
amended by this Amendment, are and shall continue to be in full force and effect
and are hereby in all respects ratified and confirmed. Without limiting the
generality of the foregoing, the Security Agreement and all of the Collateral
described therein do and shall continue to secure the payment of all Obligations
of the Loan Parties under the Loan Documents, in each case as amended by this
Amendment.

(c) The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of any Lender or the Agent under any of the Loan Documents, nor
constitute a waiver of any provision of any of the Loan Documents.

SECTION 5. Costs and Expenses. Borrower agrees to indefeasibly pay on demand all
costs and expenses of the Agent in connection with the preparation, execution,
delivery and administration, modification and amendment of this Amendment and
the other instruments and documents to be delivered hereunder (including,
without limitation, the reasonable fees and expenses of counsel for the Agent)
in accordance with the terms of Section 13.7 of the Credit Agreement.

SECTION 6. Release. In further consideration of the Agent and the Lenders
execution of this Amendment, the Borrower for itself and on behalf of its
successors, assigns, Subsidiaries and Affiliates (the “Releasing Parties”),
hereby forever releases the Agent and the Lenders and their successors, assigns,
parents, Subsidiaries, Affiliates, officers, employees, directors, agents and
attorneys (collectively, the “Releasees”) from any and all debts, claims,
demands, liabilities, responsibilities, disputes, causes, damages, actions and
causes of action (whether at law or in equity) and obligations of every nature
whatsoever, whether liquidated or unliquidated, known or unknown, matured or
unmatured, fixed or contingent (collectively, “Claims”), that any Releasing
Party may have against the Releasees that arise from or relate to any actions
which the Releasees may have taken or omitted to take prior to the date hereof,
including without limitation with respect to the Obligations, any Collateral,
the Credit Agreement, any other Loan Document and any third parties liable in
whole or in part for the Obligations.

SECTION 7. Execution in Counterparts. This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Amendment by telecopier
shall be effective as delivery of a manually executed counterpart of this
Amendment.

SECTION 8. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of California.

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

LEAPFROG ENTERPRISES, INC. By:   /s/ William B. Chiasson       Name: William B.
Chiasson       Title: Chief Financial Officer

 

BANK OF AMERICA, N.A., as the Agent By:   /s/ Steven W. Sharp       Name: Steven
W. Sharp       Title: Vice President

 

BANK OF AMERICA, N.A., as a Lender By:   /s/ Steven W. Sharp       Name: Steven
W. Sharp       Title: Vice President

Signature Page to Amendment No. 1 to Credit Agreement

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CONSENT

Dated as of May 15, 2008

We, the undersigned, as Guarantors under the Subsidiary Guaranty and the
Security Agreement (each as defined in the Credit Agreement) in favor of the
Agent and, for its benefit and the benefit of the Lenders party to the Credit
Agreement referred to in the foregoing Amendment No. 1 to the Credit Agreement
(the “Amendment”), hereby consent to such Amendment and hereby confirm and agree
that notwithstanding the effectiveness of such Amendment, the Subsidiary
Guaranty and Security Agreement are, and shall continue to be, in full force and
effect and are hereby ratified and confirmed in all respects, except that, on
and after the effectiveness of such Amendment, each reference in the Guaranty,
Subsidiary Guaranty, Security Agreement, Intellectual Property Security
Agreement and Pledge Agreement to “Credit Agreement”, “thereunder”, “thereof”,
or words of like import shall mean and be a reference to the Credit Agreement,
as amended by such Amendment.

 

LFC VENTURES, LLC By:   /s/ William B. Chiasson       Name: William B. Chiasson
      Title: Chief Financial Officer