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                                                                    Exhibit 10.7

                            INDEMNIFICATION AGREEMENT

      This INDEMNIFICATION AGREEMENT (the "Agreement") is made and entered into
effective as of this 12th day of September, 2002, by and between Golfsmith
International, Inc., a Delaware corporation (including any successors thereto,
the "Company"), and Carl F. Paul ("Indemnitee").

                                    RECITALS:

      A. Competent and experienced persons are reluctant to serve or to continue
to serve corporations as directors, officers, or in other capacities unless they
are provided with adequate protection through insurance or indemnification (or
both) against claims and actions against them arising out of their service to
and activities on behalf of those corporations.

      B. The current uncertainties relating to the availability of adequate
insurance for directors and officers have increased the difficulty for
corporations to attract and retain competent and experienced persons.

      C. The Board of Directors of the Company (the "Board") has determined that
the continuation of present trends in litigation will make it more difficult to
attract and retain competent and experienced persons, that this situation is
detrimental to the best interests of the Company's stockholders, and that the
Company should act to assure its directors and officers that there will be
increased certainty of adequate protection in the future.

      D. It is reasonable, prudent, and necessary for the Company to obligate
itself contractually to indemnify its directors and officers to the fullest
extent permitted by applicable law in order to induce them to serve or continue
to serve the Company.

      E. Indemnitee is willing to serve and continue to serve the Company on the
condition that he be indemnified to the fullest extent permitted by law.

      F. Concurrently with the execution of this Agreement, Indemnitee is
agreeing to serve or to continue to serve as a director or officer of the
Company.

                                   AGREEMENTS:

      NOW, THEREFORE, in consideration of the foregoing premises, Indemnitee's
agreement to serve or continue to serve as a director or officer of the Company,
and the covenants contained in this Agreement, the Company and Indemnitee hereby
covenant and agree as follows:

1. Certain Definitions. For purposes of this Agreement:

      (a)   Affiliate: shall mean any Person that directly, or indirectly,
            through one or more intermediaries, controls, is controlled by, or
            is under common control with the Person specified.

      (b)   Change of Control: shall mean the occurrence of any of the following
            events:
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            (i)   The acquisition after the date of this Agreement by any
                  individual, entity, or group (within the meaning of Section
                  13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
                  as amended (the "Exchange Act")) (a "Person") of beneficial
                  ownership (within the meaning of Rule 13d-3 promulgated under
                  the Exchange Act) of 20% or more of either (x) the then
                  outstanding shares of common stock of the Company (the
                  "Outstanding Company Common Stock") or (y) the combined voting
                  power of the then outstanding voting securities of the Company
                  entitled to vote generally in the election of directors (the
                  "Outstanding Company Voting Securities"); provided, however,
                  that for purposes of this paragraph (i), the following
                  acquisitions shall not constitute a Change of Control: any
                  acquisition directly from the Company or any Subsidiary
                  thereof; any acquisition by the Company or any Subsidiary
                  thereof; any acquisition by any employee benefit plan (or
                  related trust) sponsored or maintained by the Company or any
                  Subsidiary of the Company; or any acquisition by any entity or
                  its security holders pursuant to a transaction which complies
                  with clauses (A), (B), and (C) of paragraph (iii) below;

            (ii)  Individuals who, as of the date of this Agreement, constitute
                  the Board (the "Incumbent Board") cease for any reason to
                  constitute at least a majority of the Board; provided,
                  however, that any individual becoming a director subsequent to
                  the date of this Agreement whose election or appointment by
                  the Board or nomination for election by the Company's
                  stockholders, was approved by a vote of at least a majority of
                  the directors then comprising the Incumbent Board, shall in
                  either case be considered as though such individual were a
                  member of the Incumbent Board, but excluding, for this
                  purpose, any such individual whose initial assumption of
                  office occurs as a result of an actual or threatened election
                  contest with respect to the election or removal of directors
                  or other actual or threatened solicitation of proxies or
                  consents by or on behalf of a Person other than the Board;

            (iii) Consummation of a reorganization, merger or consolidation or
                  sale or other disposition of all or substantially all of the
                  assets of the Company or an acquisition of assets of another
                  corporation (a "Business Combination"), unless in each case,
                  following such Business Combination, (A) all or substantially
                  all of the individuals and entities who were the beneficial
                  owners, respectively, of the Outstanding Company Common Stock
                  and Outstanding Company Voting Securities immediately prior to
                  such Business Combination beneficially own, directly or
                  indirectly, more than 50% of, respectively, the then
                  outstanding shares of common stock and the combined voting
                  power of the then outstanding voting securities entitled to
                  vote generally in the election of directors, as the case may
                  be, of the corporation resulting from such Business
                  Combination (including, without limitation, a corporation
                  which as a result of such transaction owns the Company or all
                  or substantially all of the Company's assets either directly
                  or through one or more
<PAGE>
                  subsidiaries) in substantially the same proportions as their
                  ownership, immediately prior to such Business Combination of
                  the Outstanding Company Common Stock and Outstanding
                  Corporation Voting Securities, as the case may be, (B) no
                  Person (excluding any employee benefit plan (or related trust)
                  of the Company or the corporation resulting from such Business
                  Combination) beneficially owns, directly or indirectly, 20% or
                  more of, respectively, the then outstanding shares of common
                  stock of the corporation resulting from such Business
                  Combination or the combined voting power of the then
                  outstanding voting securities of such corporation except to
                  the extent that such ownership of the Company existed prior to
                  the Business Combination and (C) at least a majority of the
                  members of the board of directors of the corporation resulting
                  from such Business Combination were members of the Incumbent
                  Board at the time of the execution of the initial agreement,
                  or of the action of the Board, providing for such Business
                  Combination; or

            (iv)  Approval by the stockholders of the Company of a complete
                  liquidation or dissolution of the Company.

      (c)   Claim: shall mean any threatened, pending, or completed action,
            suit, or proceeding (including, without limitation, securities laws
            actions, suits, and proceedings and also any cross claim or
            counterclaim in any action, suit, or proceeding), whether civil,
            criminal, arbitral, administrative, or investigative in nature, or
            any inquiry or investigation (including discovery), whether
            conducted by the Company or any other Person, that Indemnitee in
            good faith believes might lead to the institution of any action,
            suit, or proceeding.

      (d)   Expenses: shall mean all costs, expenses (including attorneys' and
            expert witnesses' fees), and obligations paid or incurred in
            connection with investigating, defending (including affirmative
            defenses and counterclaims), being a witness in, or participating in
            (including on appeal), or preparing to defend, be a witness in, or
            participate in, any Claim relating to any Indemnifiable Event.

      (e)   Indemnifiable Event: shall mean any actual or alleged act, omission,
            statement, misstatement, event, or occurrence related to the fact
            that Indemnitee is or was a director, officer, agent, or fiduciary
            of the Company, or is or was serving at the request of the Company
            as a director, officer, trustee, agent, or fiduciary of another
            corporation, partnership, joint venture, employee benefit plan,
            trust, or other enterprise, or by reason of any actual or alleged
            thing done or not done by Indemnitee in any such capacity. For
            purposes of this Agreement, the Company agrees that Indemnitee's
            service on behalf of or with respect to any Subsidiary or employee
            benefits plan of the Company or any Subsidiary of the Company shall
            be deemed to be at the request of the Company.

      (f]   Indemnifiable Liabilities: shall mean all Expenses and all other
            liabilities, damages (including, without limitation, punitive,
            exemplary, and the multiplied portion of any damages), judgments,
            payments, fines, penalties, amounts paid in
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            settlement, and awards paid or incurred that arise out of, or in any
            way relate to, any Indemnifiable Event.

      (g)   Potential Change of Control: shall be deemed to have occurred if (i)
            the Company enters into an agreement, the consummation of which
            would result in the occurrence of a Change of Control, (ii) any
            Person (including the Company) publicly announces an intention to
            take or to consider taking actions that, if consummated, would
            constitute a Change of Control, or (iii) the Board adopts a
            resolution to the effect that, for purposes of this Agreement, a
            Potential Change of Control has occurred.

      (h)   Reviewing Party: shall mean a member or members of the Board who are
            not parties to the particular Claim for which Indemnitee is seeking
            indemnification or if a Change of Control has occurred or if there
            is a Potential Change of Control and Indemnitee so requests, or if
            the members of the Board so elect, or if all of the members of the
            Board are parties to such Claim, Special Counsel.

      (i)   Special Counsel: shall mean special, independent legal counsel
            selected by Indemnitee and approved by the Company (which approval
            shall not be unreasonably withheld), and who has not otherwise
            performed material services for the Company or for Indemnitee within
            the last three years (other than as Special Counsel under this
            Agreement or similar agreements).

      (j)   Subsidiary: shall mean, with respect to any Person, any corporation
            or other entity of which a majority of the voting power of the
            voting equity securities or equity interest is owned, directly or
            indirectly, by that Person.

2. Indemnification and Expense Advancement.

      (a)   The Company shall indemnify Indemnitee and hold Indemnitee harmless
            to the fullest extent permitted by law, as soon as practicable but
            in any event no later than 30 days after written demand is presented
            to the Company, from and against any and all Indemnifiable
            Liabilities. Notwithstanding the foregoing, the obligations of the
            Company under Section 2(a) shall be subject to the condition that
            the Reviewing Party shall not have determined (in a written opinion,
            in any case in which Special Counsel is involved) that Indemnitee is
            not permitted to be indemnified under applicable law. Nothing
            contained in this Agreement shall require any determination under
            this Section 2(a) to be made by the Reviewing Party prior to the
            disposition or conclusion of the Claim against the Indemnitee.

      (b)   If so requested by Indemnitee, the Company shall advance to
            Indemnitee all reasonable Expenses incurred by Indemnitee to the
            fullest extent permitted by law (or, if applicable, reimburse
            Indemnitee for any and all reasonable Expenses incurred by
            Indemnitee and previously paid by Indemnitee) within ten business
            days after such request (an "Expense Advance") and delivery by
            Indemnitee of an undertaking to repay Expense Advances if and to the
            extent such undertaking is required by applicable law prior to the
            Company's payment of Expense
<PAGE>
            Advances. The Company shall be obligated from time to time at the
            request of Indemnitee to make or pay an Expense Advance in advance
            of the final disposition or conclusion of any Claim. In connection
            with any request for an Expense Advance, if requested by the
            Company, Indemnitee or Indemnitee's counsel shall submit an
            affidavit stating that the Expenses to which the Expense Advances
            relate are reasonable. Any dispute as to the reasonableness of any
            Expense shall not delay an Expense Advance by the Company. If, when,
            and to the extent that the Reviewing Party determines that
            Indemnitee would not be permitted to be indemnified with respect to
            a Claim under applicable law or the amount of the Expense Advance
            was not reasonable, the Company shall be entitled to be reimbursed
            by Indemnitee and Indemnitee hereby agrees to reimburse the Company
            without interest (which agreement shall be an unsecured obligation
            of Indemnitee) for (x) all related Expense Advances theretofore
            made or paid by the Company in the event that it is determined that
            indemnification would not be permitted or (y) the excessive portion
            of any Expense Advances in the event that it is determined that such
            Expenses Advances were unreasonable, in either case, if and to the
            extent such reimbursement is required by applicable law; provided,
            however, that if Indemnitee has commenced legal proceedings in a
            court of competent jurisdiction to secure a determination that
            Indemnitee could be indemnified under applicable law, or that the
            Expense Advances were reasonable, any determination made by the
            Reviewing Party that Indemnitee would not be permitted to be
            indemnified under applicable law or that the Expense Advances were
            unreasonable shall not be binding, and the Company shall be
            obligated to continue to make Expense Advances, until a final
            judicial determination is made with respect thereto (as to which all
            rights of appeal therefrom have been exhausted or lapsed), which
            determination shall be conclusive and binding. If there has been a
            Potential Change of Control or a Change of Control, the Reviewing
            Party shall be advised by or shall be Special Counsel, if Indemnitee
            so requests. If there has been no determination by the Reviewing
            Party or if the Reviewing Party determines that Indemnitee
            substantively is not permitted to be indemnified in whole or part
            under applicable law or that any Expense Advances were unreasonable,
            Indemnitee shall have the right to commence litigation in any court
            in the states of Texas or Delaware having subject matter
            jurisdiction thereof and in which venue is proper seeking an initial
            determination by the court or challenging any such determination by
            the Reviewing Party or any aspect thereof, and the Company hereby
            consents to service of process and to appear in any such proceeding.
            Any determination by the Reviewing Party otherwise shall be
            conclusive and binding on the Company and Indemnitee.

      (c)   Nothing in this Agreement, however, shall require the Company to
            indemnify Indemnitee with respect to any Claim initiated by
            Indemnitee, other than a Claim solely seeking enforcement of the
            Company's indemnification obligations to Indemnitee or a Claim
            authorized by the Board.

3. Change of Control. The Company agrees that, if there is a Potential Change in
Control or a Change of Control and if Indemnitee requests in writing that
Special Counsel be the Reviewing Party, then Special Counsel shall be the
Reviewing Party. In such a case, the Company agrees
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not to request or seek reimbursement from Indemnitee of any indemnification
payment or Expense Advances unless Special Counsel has rendered its written
opinion to the Company and Indemnitee (i) that the Company was not or is not
permitted under applicable law to pay Indemnitee and to allow Indemnitee to
retain such indemnification payment or Expense Advances or (ii) that such
Expense Advances were unreasonable. However, if Indemnitee has commenced legal
proceedings in a court of competent jurisdiction to secure a determination that
Indemnitee could be indemnified under applicable law or that the Expense
Advances were reasonable, any determination made by Special Counsel that
Indemnitee would not be permitted to be indemnified under applicable law or that
the Expense Advances were unreasonable shall not be binding, and Indemnitee
shall not be required to reimburse the Company for any Expense Advance, and the
Company shall be obligated to continue to make Expense Advances, until a final
judicial determination is made with respect thereto (as to which all rights of
appeal therefore have been exhausted or lapsed), which determination shall be
conclusive and binding. The Company agrees to pay the reasonable fees of Special
Counsel and to indemnify Special Counsel against any and all expenses (including
attorneys' fees), claims, liabilities, and damages arising out of or relating to
this Agreement or Special Counsel's engagement pursuant hereto.

4. Indemnification for Additional Expenses. The Company shall indemnify
Indemnitee against any and all costs and expenses (including attorneys' and
expert witnesses' fees) and, if requested by Indemnitee, shall (within two
business days of that request) advance those costs and expenses to Indemnitee,
that are incurred by Indemnitee if Indemnitee, whether by formal proceedings or
through demand and negotiation without formal proceedings: (a) seeks to enforce
Indemnitee's rights under this Agreement; (b) seeks to enforce Indemnitee's
rights to expense advancement or indemnification under any other agreement or
provision of the Company's Certificate of Incorporation, as amended (the
"Certificate of Incorporation"), or Bylaws (the "Bylaws") now or hereafter in
effect relating to Claims for Indemnifiable Events; or (c) seeks recovery under
any directors' and officers' liability insurance policies maintained by the
Company, in each case regardless of whether Indemnitee ultimately prevails;
provided that a court of competent jurisdiction has not found Indemnitee's claim
for indemnification or expense advancements under the foregoing clause (a), (b)
or (c) to be frivolous, presented for an improper purpose, without evidentiary
support, or otherwise sanctionable under Federal Rule of Civil Procedure No. 11
or an analogous rule or law, and provided further, that if a court makes such a
finding, Indemnitee shall reimburse the Company for all amounts previously
advanced to Indemnitee pursuant to this Section 4. Subject to the provisos
contained in the preceding sentence, to the fullest extent permitted by law, the
Company waives any and all rights that it may have to recover its costs and
expenses from Indemnitee.

5. Partial Indemnity. If Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some, but not all, of
Indemnitee's Indemnifiable Liabilities, the Company shall indemnify Indemnitee
for the portion thereof to which Indemnitee is entitled.

6. Contribution.

      (a)   Contribution Payment. To the extent the indemnification provided for
            under any provision of this Agreement is determined (in the manner
            hereinabove provided) not to be permitted under applicable law, the
            Company, in lieu of indemnifying Indemnitee, shall, to the extent
            permitted by law, contribute to the amount of any
<PAGE>
            and all Indemnifiable Liabilities incurred or paid by Indemnitee for
            which such indemnification is not permitted. The amount the Company
            contributes shall be in such proportion as is appropriate to reflect
            the relative fault of Indemnitee, on the one hand, and of the
            Company and any and all other parties (including officers and
            directors of the Company other than Indemnitee) who may be at fault
            (collectively, including the Company, the "Third Parties"), on the
            other hand.

      (b)   Relative Fault. The relative fault of the Third Parties and the
            Indemnitee shall be determined by reference to the relative fault of
            Indemnitee as determined by the court or other governmental agency
            or to the extent such court or other governmental agency does not
            apportion relative fault, by the Reviewing Party (which shall
            include Special Counsel) after giving effect to, among other things,
            the relative intent, knowledge, access to information, and
            opportunity to prevent or correct the relevant events, of each
            party, and other relevant equitable considerations. The Company and
            Indemnitee agree that it would not be just and equitable if
            contribution were determined by pro rata allocation or by any other
            method of allocation that does take account of the equitable
            considerations referred to in this Section 6(b).

7. Burden of Proof. In connection with any determination by the Reviewing Party
or otherwise as to whether Indemnitee is entitled to be indemnified under any
provision of this Agreement or to receive contribution pursuant to Section 6 of
this Agreement, to the extent permitted by law the burden of proof shall be on
the Company to establish that Indemnitee is not so entitled.

8. No Presumption. For purposes of this Agreement, the termination of any Claim
by judgment, order, settlement (whether with or without court approval), or
conviction, or upon a plea of nolo contendere, or its equivalent, or an entry of
an order of probation prior to judgment shall not create a presumption (other
than any presumption arising as a matter of law that the parties may not
contractually agree to disregard) that Indemnitee did not meet any particular
standard of conduct or have any particular belief or that a court has determined
that indemnification is not permitted by applicable law.

9. Non-exclusivity. The rights of Indemnitee hereunder shall be in addition to
any other rights Indemnitee may have under the Bylaws or Certificate of
Incorporation or the Delaware General Corporation Law or otherwise. To the
extent that a change in the Delaware General Corporation Law (whether by statute
or judicial decision) permits greater indemnification by agreement than would be
afforded currently under the Bylaws or Certificate of Incorporation and this
Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by
this Agreement the greater benefits so afforded by that change. Indemnitee's
rights under this Agreement shall not be diminished by any amendment to the
Certificate of Incorporation or Bylaws, or of any other agreement or instrument
to which Indemnitee is not a party, and shall not diminish any other rights that
Indemnitee now or in the future has against the Company.

10. Liability Insurance. Except as otherwise agreed to by the Company in a
written agreement with Indemnitee or for the benefit of Indemnitee, to the
extent the Company maintains an insurance policy or policies providing
directors' and officers' liability insurance, Indemnitee
<PAGE>
shall be covered by that policy or those policies, in accordance with its or
their terms, to the maximum extent of the coverage available for any Company
director or officer.

11. Period of Limitations. No action, lawsuit, or proceeding may be brought
against Indemnitee or Indemnitee's spouse, heirs, executors, or personal or
legal representatives, nor may any cause of action be asserted in any such
action, lawsuit, or proceeding, by or on behalf of the Company, after the
expiration of two years after the statute of limitations commences with respect
to Indemnitee's act or omission that gave rise to the action, lawsuit,
proceeding, or cause of action; provided, however, that, if any shorter period
of limitations is otherwise applicable to any such action, lawsuit, proceeding,
or cause of action, the shorter period shall govern.

12. Amendments. No supplement, modification, or amendment of this Agreement
shall be binding unless executed in writing by both of the parties hereto. No
waiver of any provision of this Agreement shall be effective unless in a writing
sided by the party granting the waiver. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall that waiver constitute a
continuing waiver.

13. Other Sources. Indemnitee shall not be required to exercise any rights that
Indemnitee may have against any other Person (for example, under an insurance
policy) before Indemnitee enforces his rights under this Agreement. However, to
the extent the Company actually indemnifies Indemnitee or advances him Expenses,
the Company shall be subrogated to the rights of Indemnitee and shall be
entitled to enforce any such rights which Indemnitee may have against third
parties. Indemnitee shall assist the Company in enforcing those rights if it
pays his costs and expenses of doing so. If Indemnitee is actually indemnified
or advanced Expenses by any third party, then, for so long as Indemnitee is not
required to disgorge the amounts so received, to that extent the Company shall
be relieved of its obligation to indemnify Indemnitee or advance Indemnitee
Expenses.

14. Binding Effect. This agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors, assigns (including any direct or indirect successor by merger or
consolidation), spouses, heirs, and personal and legal representatives. This
Agreement shall continue in effect regardless of whether Indemnitee continues to
serve as an officer or director of the Company or another enterprise at the
Company's request.

15. Severability. If any provision of this Agreement is held to be illegal,
invalid, or unenforceable under present or future laws effective during the
term hereof, that provision shall be fully severable; this Agreement shall be
construed and enforced as if that illegal, invalid, or unenforceable provision
had never comprised a part hereof; and the remaining provisions shall remain in
full force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement. Furthermore, in
lieu of that illegal, invalid, or unenforceable provision, there shall be added
automatically as a part of this Agreement a provision as similar in terms to the
illegal, invalid, or unenforceable provision as may be possible and be legal,
valid, and enforceable.
<PAGE>
16. Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Delaware applicable to
contracts made and to be performed in that state without giving effect to the
principles of conflicts of laws.

17. Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.

18. Notices. Whenever this Agreement requires or permits notice to be given by
one party to the other, such notice must be in writing to be effective and shall
be deemed delivered and received by the party to whom it is sent upon actual
receipt (by any means) Of such notice. Receipt of a notice by the Secretary of
the Company shall be deemed receipt of such notice by the Company.

19. Complete Agreement. This Agreement constitutes the complete understanding
and agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings between the parties with
respect to the subject matter hereof, other than any indemnification rights that
Indemnitee may enjoy under the Certificate of Incorporation, the Bylaws, or the
Delaware General Corporation Law.

20. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but in making proof hereof it shall
not be necessary to produce or account for more than one such counterpart.
<PAGE>

      EXECUTED as of the date first written above.


      GOLFSMITH INTERNATIONAL, INC.



      By:     /s/ Franklin C. Paul
              ----------------------------
      Name:   Franklin C. Paul
              ----------------------------
      Title:  President
              ----------------------------

      INDEMNITEE:

       /s/ Carl F. Paul
      ------------------------------------
      Name: Carl F. Paul


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