**FIRST
      AMENDMENT TO SECURED LOAN AGREEMENT**




This
      First Amendment (this “ Amendment ”)
      to the
      Secured Loan Agreement referenced below is entered into as of December __,
      2005,
      among Leaf
      Fund
      II, LLC, a Delaware limited liability company, as Borrower (the “ Borrower ”),
      Leaf
      Funding, Inc., a Delaware corporation, as Originator (the “ Originator ”),
      Lease
      Equity Appreciation Fund II, L.P., a Delaware limited partnership, as Seller
      (the “ Seller ”),
      Leaf
      Financial Corporation, a Delaware corporation, as Servicer (the “ Servicer ”),
      U.S.
      Bank National Association, a national banking association, as Collateral Agent
      (in such capacity, the “ Collateral
      Agent ”)
      and as
      Securities Intermediary (in such capacity, the “ Securities
      Intermediary ”)
      and
      WestLB AG, New York Branch, as Lender (the “ Lender ”).




R  E  C  I  T  A  L  S :




WHEREAS,
      the Borrower, the Originator, the Seller, the Servicer, the Collateral Agent,
      the Securities Intermediary and the Lender are parties to the Secured Loan
      Agreement, dated as of June 1, 2005 (as amended, supplemented and otherwise
      modified from time to time, the “ Secured
      Loan Agreement ”);




WHEREAS,
      the parties hereto desire to amend the Secured Loan Agreement pursuant to
      Section 14.04 thereof to make certain amendments thereto as further described
      in
      this Amendment;




NOW,
      THEREFORE, in consideration of the mutual covenants and undertakings herein
      contained, and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties hereto hereby agree
      as
      follows:




Section
      1.  Amendments
      to the Secured Loan Agreement .
      Effective as of the execution and delivery of this Amendment by all parties
      hereto:




(a)  The
      definition of “Interest Coverage Ratio” in Appendix
      A to the
      Secured Loan Agreement is hereby deleted.




(b)  Section
      7.02(jj) of the Secured Loan Agreement is hereby amended and restated in its
      entirety as follows:




“(jj)  As
      of the
      last day of each fiscal quarter commencing December 31, 2006, LEAF shall
      maintain “partners equity” (as reflected in its financial statements) of no less
      than 75% of “partners equity” as of the last day of its offering period pursuant
      to its Prospectus dated December 22, 2004 as reported in its financial
      statements for December 31, 2006.”




(c)  Section
      8.01(ff) of the Secured Loan Agreement is hereby amended and restated in its
      entirety as follows:




“(i)
      LEAF
      shall have failed to maintain a Senior Leverage Ratio no greater than 7.5:1.0
      or
      (ii) the Servicer shall have failed to maintain a (a) “Minimum Tangible Net
      Worth” (defined as stockholders’ equity plus subordinated debt less intangibles)
      of $7,500,000 or (b) minimum stockholders’ equity of $1,000,000 or (iii) LEAF
      shall have defaulted (after giving effect to any and all notice, grace and
      cure
      periods) in respect of any material Indebtedness for borrowed
      money.”







Section
      2.  Representations
      and Warranties .
      Each of
      the Borrower, the Seller, the Servicer and the Originator hereby represents
      and
      warrants that (i) it has the power and is duly authorized to execute and deliver
      this Amendment, (ii) this Amendment has been duly authorized, executed and
      delivered, (iii) it is and will continue to be duly authorized to perform its
      respective obligations under the Loan Documents and this Amendment, (iv) the
      execution, delivery and performance by it of this Amendment shall not (1) result
      in the breach of, or constitute (alone or with notice or with the lapse of
      time
      or both) a default under, any material agreement or instrument to which it
      is a
      party, (2) violate (A) any provision of law, statute, rule or regulation, or
      organizational documents or other constitutive documents, (B) any order of
      any
      Governmental Authority or (C) any provision of any material indenture, agreement
      or other instrument to which it is a party or by which it or any of its property
      is or may be bound, or (3) result in the creation or imposition of any Lien
      upon
      or with respect to any property or assets now owned or hereafter acquired by
      the
      Borrower other than pursuant to the Loan Documents, (v) this Amendment and
      each
      of the Loan Documents to which it is a party or by which it or its assets may
      be
      or is bound constitutes its legal, valid and binding obligations, enforceable
      against it (subject, as to the enforcement of remedies, to applicable
      bankruptcy, reorganization, insolvency, moratorium and similar laws affecting
      creditors’ rights generally and to general principles of equity), (vi) except as
      publicly disclosed, there are no actions, suits, investigations (civil or
      criminal) or proceedings at law or in equity or by or before any Governmental
      Authority pending or, to its knowledge, threatened against or affecting it
      or
      any of its business, property or rights (1) which involve any Loan Documents
      or
      (2) which would be materially likely to result in a Material Adverse Effect,
      (vii) it is not in default or violation with respect to any law, rule or
      regulation, judgment, writ, injunction or decree order of any court,
      governmental authority, regulatory agency or arbitration board or tribunal
      and,
      with respect to the Originator, the effect of which would have a material
      adverse effect on its business, assets, operations or financial condition and
      (viii) no Facility Termination Event, Default or Event of Default has occurred
      or is continuing. Except as expressly amended by the terms of this Amendment,
      all terms and conditions of the Secured Loan Agreement shall remain in full
      force and effect and are hereby ratified in all respects.




Section
      3.  Defined
      Terms; Headings .  All
      capitalized terms used herein, unless otherwise defined herein, have the same
      meanings provided herein or in Appendix
      A to the
      Secured Loan Agreement. The
      headings of the various Sections of this Amendment have been inserted for
      convenience of reference only and shall not be deemed to be part of this
      Amendment.




Section
      4.  Limited
      Amendment .
      This
      Amendment is limited precisely as written and shall not be deemed to (a) be
      a
      consent to a waiver or any other term or condition of the Secured Loan
      Agreement, the other Loan Documents or any of the documents referred to therein
      or executed in connection therewith or (b) prejudice any right or rights the
      Lender or the Hedge Counterparties may now have or may have in the future under
      or in connection with the Secured Loan Agreement, the other Loan Documents
      or
      any documents referred to therein or executed in connection therewith. Whenever
      the Secured Loan Agreement is referred to in the Secured Loan Agreement or
      any
      of the instruments, agreements or other documents or papers executed and
      delivered in connection therewith, it shall be deemed to mean the Secured Loan
      Agreement, as the case may be, as modified by this Amendment. Except as hereby
      amended, no other term, condition or provision of the Secured Loan Agreement
      shall be deemed modified or amended, and this Amendment shall not be considered
      a novation.







Section
      5.  Construction;
      Severability .
      This
      Amendment is a document executed pursuant to the Secured Loan Agreement and
      shall (unless otherwise expressly indicated therein) be construed, administered
      or applied in accordance with the terms and provisions thereof. If
      any
      one or more of the covenants, agreements, provisions or terms of this Amendment
      shall be held invalid in a jurisdiction for any reason whatsoever, then, in
      such
      jurisdiction, such covenants, agreements, provisions or terms shall be deemed
      severable from the remaining covenants, agreements, provisions or terms of
      this
      Amendment and shall in no way affect the validity or enforceability of the
      other
      covenants, agreements, provisions or terms of this Amendment.




Section
      6.  Counterparts;
      Facsimile Signature .
      This
      Amendment may be executed by the parties hereto in several counterparts, each
      of
      which shall be deemed to be an original and all of which shall constitute
      together but one and the same agreement. The parties may execute facsimile
      copies of this Amendment and the facsimile signature of any such party shall
      be
      deemed an original and fully binding on said party.




Section
      7.  Governing
      Law .
      This
      Amendment shall be governed and construed in accordance with the applicable
      terms and provisions of Section 14.09 (Governing Law) of the Secured Loan
      Agreement, which terms and provisions are incorporated herein by
      reference.




Section
      8.  Successor
      and Assigns .
      This
      Amendment shall be binding upon and inure to the benefit of the parties hereto
      and their respective successors and assigns.










IN
      WITNESS WHEREOF, the parties hereto have caused this First Amendment to the
      Secured Loan Agreement to be duly executed by their respective authorized
      officers as of the day and year first written above.







BORROWER:  **LEAF
      FUND II, LLC**




By:


Name:


Title:




ORIGINATOR:  **LEAF
      FUNDING, INC.**




By:


Name:


Title:




SELLER:  **LEASE
      EQUITY APPRECIATION FUND II, L.P.**




By: **LEAF FINANCIAL CORPORATION,**


as
      General
      Partner




By:


Name:


Title:




SERVICER:  **LEAF
      FINANCIAL CORPORATION**




By:


Name:


Title:




LENDER:  **WESTLB
      AG, NEW YORK** **BRANCH**




By:


Name:


Title:




By:


Name:


Title:




COLLATERAL
      AGENT/


SECURITIES
      INTERMEDIARY:  **U.S.
      BANK NATIONAL ASSOCIATION**




By:


Name:


Title: