ex10-3.htm


    
      

    

    Exhibit 10.3

     

    
      EMPLOYMENT
        AGREEMENT

      


      This
        Employment Agreement (the
        "Agreement") is made on or as of May 1, 2007 between AMERICA’S CAR-MART, INC.,
        an Arkansas corporation (the "Company") and JEFFREY A. WILLIAMS (the
        "Associate").

      


      WITNESSETH:

      


      WHEREAS,
        the Company is engaged in the
        business of the sale and financing of used vehicles (“Company Business”);
        and

      


      WHEREAS,
the
        Associate is a
        Senior Executive Officer of the Company, and the Company desires to continue
        the
        employment of the Associate, and the Associate desires to provide his services
        to the Company upon the terms and conditions hereinafter set forth;

      


      WHEREAS,
the
        Company
        periodically sells its finance receivables to Colonial Auto Finance, Inc.,
        an
        Arkansas corporation ("Colonial") and services those loans on Colonial’s behalf
        (collectively, the Company and Colonial are referred to herein as "Car-Mart");
        and

      


      WHEREAS,
America’s
        Car-Mart,
        Inc., a Texas corporation (the "Parent Company") owns 100% of the outstanding
        common stock of the Company;

      


      WHEREAS,
        in order to conduct its business, the Company owns and uses trade secrets
        as
        defined under applicable law, as well as confidential and propriety information;
        and

      


      WHEREAS,
        Associate, during the term of
        his employment with the Company and in order to carry out his duties with
        the
        Company, has or will have contact with the Company’s customers and employees and
        has or will have access to and has or will become privy to or acquainted
        with
        certain confidential information and trade secrets, which are owned by the
        Company and which are regularly used in the business of the Company and which
        are generally not known to its competitors;

      


      NOW,
        THEREFORE, in consideration
        of the mutual covenants and promises contained herein, the parties hereto,
        each
        intending to be legally bound hereby, agree as follows:

      


      1.           Employment.  The
        Company hereby continues the employment of the Associate as a Senior Executive
        Officer of the Company, and the Associate accepts such
        employment.  During the term of employment under this Agreement (the
        "Employment Term"), the Associate shall perform such duties as shall reasonably
        be required of a Senior Executive Officer of the Company.  The
        Associate further agrees to perform, without additional compensation, such
        other
        work for the Company and for any subsidiary or affiliate of the Company in
        which
        the Company has an interest, including, without limitation, Colonial and
        the
        Parent Company, as the Board of Directors of the Company or the Parent Company
        shall from time to time reasonably specify.  It is expressly agreed
        and understood between the Company and the Associate that the term of this
        Agreement is in no way dependent upon the Associate’s holding or being elected
        to any office of the Company.  The Associate may be deemed an employee
        of, and paid by the Company, Colonial, or the Parent Company, as reasonably
        determined by the Company.

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      2.           Performance.  The
        Associate agrees to devote his entire business efforts to the performance
        of his
        duties hereunder, provided, however, that the Associate may engage in personal
        investment activities not involving the Company so long as they do not interfere
        with the performance of his duties hereunder.

      


      3.           Term.  Unless
        otherwise terminated in accordance with Sections 8, 9, 10 or 11, the Employment
        Term shall be for a term ending April 30, 2010.  This Agreement shall
        be automatically renewed for successive additional Employment Terms of one
        (1)
        year each unless notice of termination is given in writing by either party
        to
        the other party at least thirty (30) days prior to the expiration of the
        initial
        Employment Term or any renewal Employment Term.

      


                     
        4.           Compensation.

       

      (a)           Base
        Salary and Benefits.  The basic annual salary of the Associate for his
        employment services hereunder shall be $180,000 or such higher annual salary,
        if
        any, as shall be approved by the Board of Directors of the Parent Company
        from
        time to time (the "Base Salary"), which shall be payable in accordance with
        the
        Company’s payroll policy.  Nothing contained herein shall affect or in
        any way limit the Associate’s rights as an Associate of the Company to
        participate in any Company 401(k) profit sharing plan or medical and life
        insurance programs offered by the Company to its employees, all of which
        shall
        be available to the Associate to the same extent as if this Agreement had
        not
        existed, and compensation received by the Associate hereunder shall be in
        addition to the foregoing.

      


      (b)           Bonus.  In
        addition to the Base Salary and fringe benefits described above, the Associate
        shall be eligible to earn an annual cash bonus (the "Bonus") during the term
        hereof beginning May 1, 2007 and ending April 30, 2010.  The Bonus
        range shall be $20,000 to $30,000 per fiscal year, and shall be based upon
        “Parent Company’s Economic Profit Per Share” as defined and described below. The
        Bonus will depend on the Parent Company attaining a minimum of 85% of its
        projected economic profit (in which case a $20,000 bonus would be paid) and
        will
        increase ratably up to 115% of its projected economic profit (in which case
        a
        $30,000 bonus would be paid), as set forth in Appendix A to
        this Agreement.

      


      "Parent
        Company’s Economic Profit Per Share" shall be defined as net operating profit
        after tax, less a capital charge (after tax) applied to the “Economic Capital”
required to generate said profits, divided by fully diluted shares
        outstanding.  “Economic Capital” is defined as net assets plus debt
        plus cumulative after tax interest expense at the end of the fiscal year.
        The
        Parent Company Economic Profit Per Share shall exclude any and all compensation
        associated with the Employment Agreements dated as of May 1, 2007 between
        the
        Company and its “named executive officers” (as listed in the Parent Company’s
        annual definitive proxy statement filed with the Securities and Exchange
        Commission).  The Bonus, if any, shall be paid each fiscal year,
        within fifteen (15) days following the Parent Company’s filing of its annual
        report on Form 10-K for such fiscal year, based upon the Parent Company’s
        Economic Profit Per Share for that fiscal year.  Any Bonus shall be
        deemed to be earned by the Associate if the Associate was an employee of
        the
        Company as of the last day of the fiscal year in question.  See
Appendix A to this Agreement for the calculation of projected
        Parent Company Economic Profit Per Share; provided however, Associate expressly
        acknowledges and agrees that the projected Parent Company Economic Profit
        Per
        Share for fiscal 2009 and fiscal 2010 shall be subject to adjustment by the
        Compensation Committee of the Board of Directors of the Parent Company, in
        its
        sole discretion.

      


      
        
          
          

        

        
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      (c)           Non-Qualified
        Stock Options.  Subject to the last sentence of this subparagraph
        4(c), the Parent Company will grant to the Associate, pursuant to the Parent
        Company’s 2007 Stock Option Plan, a non-qualified stock option to purchase
        72,000 shares of Parent Company Stock, with vesting of such option subject
        to
        the attainment of the projected Parent Company Economic Profit Per Share
        (e.g.
        60,000 shares if the Company attains 100% of its projected Parent Company
        Economic Profit Per Share goal) over the three fiscal years ending April
        30,
        2010, as set forth in Appendix A to this Agreement and in
        accordance with a Stock Option Agreement to be executed by and between the
        Associate and the Parent Company.  All terms used in this Section 4(c)
        shall have the definitions set forth in this Agreement, the 2007 Stock Option
        Plan or the Stock Option Agreement, as the case may be.

      


      No
        options will be vested unless the Parent Company attains 85% of the applicable
        fiscal year’s Economic Profit Per Share goal as set forth in Appendix
        A hereto (in which case 16,000 options would be vested for that year).
        However, “Give-Backs and Claw-Backs” will apply during the full three year
        period. For example, if the Parent Company attains 70% of its projected Parent
        Company Economic Profit Per Share in year one, there would be no options
        vested
        for that year.  If the Parent Company attains 120% of the projection
        for year two, the Associate will receive 94% of the two year total (37,600
        options).  If in year one the Parent Company attains 90% of projected
        results and 75% for year two, then the options vested in year one would be
        forfeited after year two as the two year average is less than 85%.  If
        the third year is 130% of projection, the three year total would be 285%
        or 95%
        per year of projection; therefore 56,400 options will be vested in year
        three.  Maximum options that can be vested will be 72,000 if 115% of
        the projections are met for the full three year period.

      


      The
        stock
        option grant shall be made on October 16, 2007, the date of the Parent Company’s
        annual meeting of shareholders, subject to and contingent upon the approval
        by
        such shareholders of the proposed 2007 Stock Option Plan.

      


      5.           Expense
        Account and Vacations.  Matters relating to expense accounts for
        the Associate, vacations and the like shall be mutually agreed upon from
        time to
        time.  However, the Company agrees to reimburse the Associate for all
        expenses reasonably incurred by him on behalf of the Company in accordance
        with
        the prevailing practices and policies of the Company.  In addition,
        the Associate shall be entitled to that number of days of paid vacation and
        paid
        sick leave as is consistent with the prevailing practices and policies of
        the
        Company for other employees in the same or similar position as that held
        by the
        Associate hereunder.

      


      
        
          
          

        

        
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      6.           Non-Competition,
        Non-Solicitation, Non-Disclosure, and Confidentiality Provisions

      


      (a)           Non-Solicitation:  Customers.  During
        Associate’s employment and for one (1) year immediately following the cessation
        of Associate’s employment with the Company for any reason, Associate shall not,
        on his own behalf or on behalf of any person, firm, partnership, association,
        corporation or business organization, entity or enterprise (except the Company),
        solicit, call upon, or attempt to solicit or call upon, any customer of the
        Company, or any representative of any customer of the Company with a view
        to
        selling or providing any product or service competitive with any product
        or
        service sold or provided by the Company in the Company Business, as defined
        herein, during the twelve (12) month period immediately preceding cessation
        of
        Associate’s employment with the Company, provided that the restrictions set
        forth in this section shall apply only to customers of the Company, or
        representatives of customers of the Company with whom Associate had material
        contact during such twelve (12) month period.  “Material contact”
exists between Associate and each of the Company’s existing customers: (i) with
        whom Associate actually dealt for a business purpose while employed by the
        Company or to further a business relationship between the customer and the
        Company; or (ii) whose business dealings with the Company were handled,
        coordinated or supervised by Associate or performed by Associate in whole
        or in
        part.

       

      (b)           Non-Solicitation:
        Employees.  During Associate’s employment and for one (1) year
        immediately following the cessation of Associate’s employment with the Company
        for any reason, Associate will not solicit or in any manner encourage employees
        of the Company to leave the employ of the Company.  The foregoing
        prohibition applies only to employees with whom Associate had material contact
        pursuant to Associate’s duties during the twelve (12) month period immediately
        preceding cessation of Associate’s employment with the
        Company.  “Material contact” means interaction between Associate and
        another employee of the Company:  (i) with whom Associate actually
        dealt or worked with; or (ii) whose employment or dealings with the Company
        or
        services for the Company were handled, coordinated or supervised by Associate
        .

      


      (c)           Non-Disclosure.

      


      (i)           TRADE
        SECRETS.  Associate acknowledges that the Company owns and uses trade
        secrets as defined under applicable law. “Trade secret(s)” means information,
        without regard to form, including, but not limited to, technical or
        non-technical data, a formula, a pattern, a compilation, a program, a device,
        a
        method, a technique, a drawing, a process, financial data, financial plans,
        product plans, or a list of actual or potential customers or suppliers which
        is
        not commonly known by or available to the public and which
        information:  (a) derives economic value, actual or potential, from
        not being generally known to, and not being readily ascertainable by proper
        means by, other persons who can obtain economic value from its disclosure
        or
        use; and (b) is the subject of efforts that are reasonable under the
        circumstances to maintain its secrecy.  Associate further acknowledges
        that in the course of Associate’s employment with the Company and in order to
        carry out Associate’s duties thereunder, Associate has or will become privy to
        the Trade Secrets of the Company.  Accordingly, Associate shall not
        disclose, divulge, publish to others, or use for any purpose, except as
        necessary to perform Associate’s duties while employed by the Company, any Trade
        Secret of the Company without the prior written consent of the Company, for
        so
        long as such information shall remain a Trade Secret under applicable
        law.

      


      
        
          
          

        

        
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      (ii)           CONFIDENTIAL
        INFORMATION.  Associate acknowledges that in order to conduct its
        business, the Company owns and uses written and unwritten confidential
        information.  "Confidential Information" means data and information
        relating to the business of the Company (which may not rise to the level
        of a
        Trade Secret under applicable law) which is or has been disclosed to Associate
        or of which Associate became aware as a consequence of or through Associate’s
        relationship with the Company and which has value to the Company and is not
        generally known to its competitors.  Confidential Information shall
        not include any data or information that has been voluntarily disclosed to
        the
        public by the Company (except where such public disclosure has been made
        by
        Associate without authorization) or that has been independently developed
        and
        disclosed by others, or that otherwise enters the public domain through lawful
        means.  Associate further acknowledges that in the course of his
        employment with the Company and in order to carry out his duties thereunder,
        Associate has or will become privy to Confidential Information of the
        Company.  Accordingly, Associate agrees that while employed by the
        Company, and for a period of two (2) years from the conclusion of Associate’s
        employment with the Company for any reason, Associate will not disclose,
        divulge, publish to others or use for any purpose any Confidential Information
        of the Company except to the extent necessary to perform his duties and
        responsibilities as an Associate for the Company, without the prior written
        consent of the Company.

      


      (iii)           NOTICE
        OF TRADE SECRETS AND CONFIDENTIAL INFORMATION.  Associate acknowledges
        that the Company hereby designates Trade Secrets and Confidential Information
        to
        include, by way of illustration but not limitation, confidential customer
        and
        prospective customer lists; information provided to the Company by its customers
        or clients or prospective customers or clients; customer preferences; client
        contacts; marketing plans, presentations and strategies; products; processes;
        designs; formulas; methods; clinical data; licenses; software; computer or
        electronic data disks or tapes; processes; research and plans for research;
        computer programs; methods of operations and costs data; contracts; personnel
        information; credit  terms; financial information (including without
        limitation information regarding fee and pricing structures, assets, status
        of
        client accounts or credit); or any other information designated as a trade
        secret, confidential or proprietary by the Company.

      


      
        
          
          

        

        
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      (iv)           TREATMENT
        OF TRADE SECRETS AND CONFIDENTIAL INFORMATION.  Associate understands
        and agrees to treat whatever information the Company wants to protect from
        disclosure as genuinely “confidential”, i.e., restricting access by pass
        code, stamping hardcopies of customer lists “confidential,” and restricting
        access to the customer list to designated and appropriate personnel, and
        the
        like.  Associate further agrees, as an Associate, to use his best
        efforts and the utmost diligence to guard and protect the Company’s Trade
        Secrets and Confidential Information from disclosure to any competitor, customer
        or supplier of the Company or any other person, firm, corporation or other
        entity, unless such disclosure has been specifically authorized by the Company
        in writing.

      


      (d)           Non-Competition.  Associate
        acknowledges that the Company is engaged in the Company Business as defined
        herein.  Associate further acknowledges that the Company Business is
        primarily concentrated in and focused in Arkansas, Texas, Oklahoma, and
        Missouri, (hereinafter “the
        Territory”) and that Associate’s duties and responsibilities were not limited to
        any particular area within that region but will be within and throughout
        the
        entire Territory, and rendered in connection with Company
        Business.  Associate further agrees and acknowledges that because of
        his association with the Company and his access to Trade Secrets and
        confidential, proprietary information of the Company which relate to the
        Company
        Business as herein defined, Associate’s competition with the Company as or with
        a direct competitor in the same line of business as the Company would damage
        and
        impair the business of the Company.  Therefore, during the term of his
        employment and for a period of one (1) year from the conclusion of Associate’s
        employment with the Company for any reason, Associate shall not, for himself
        or
        on behalf of any other person, firm, partnership, association, corporation,
        business organization, entity or enterprise, perform duties which are
        substantially similar to the duties performed by Associate on behalf of Company
        within the Territory for any business engaged in the Company Business as
        defined
        herein.

      


      (e)           Ownership
        of Work Product.  For purposes of this Agreement, “Work Product” shall
        mean the data, materials, documentation, computer programs, inventions (whether
        or not patentable), and all works of authorship, including all worldwide
        rights
        therein under patent, copyright, trade secret, confidential information,
        and
        other property rights, created or developed in whole or in part by Associate,
        relating to the Company Business whether prior to the date of this Agreement
        or
        in the future, either (i) while employed by the Company and that have been
        or
        will be paid for by the Company, or (ii) while employed by the Company (whether
        developed during working hours or not) and not otherwise the subject of a
        written agreement between the Company and Associate.  All Work Product
        shall be considered work made for hire by Associate and owned by the
        Company.  If any of the Work Product may not, by operation of law, be
        considered work made for hire by Associate for the Company, or if ownership
        of
        all rights, title, and interest of the intellectual property rights therein
        shall not otherwise vest exclusively in the Company, Associate hereby assigns
        to
        the Company, and upon the future creation thereof automatically assigns to
        the
        Company without further consideration, the ownership of all Work
        Product.  The Company shall have the right to obtain and hold in its
        own name patents, copyrights, registrations and any other protection available
        in the Work Product.  Associate agrees to perform, during and after
        his employment, such further acts as may be necessary or desirable to transfer,
        perfect, and defend the Company’s ownership of the Work Product as reasonably
        requested by the Company.

      


      
        
          
          

        

        
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      (f)           Return
        of Company Property.  All Company property, including, but not limited
        to, equipment, devices, records, correspondence, documents, files, reports,
        studies, manuals, compilations, drawings, blueprints, sketches, videos,
        memoranda, computer software and programs, data or any other information,
        including Trade Secrets and Confidential Information as set forth herein,
        (whether originals, copies or extracts, stored in any medium), whether prepared
        or developed by Associate or otherwise coming into Associate’s possession,
        whether maintained by Associate in the facilities of the Company, at Associate’s
        home, or at any other location, is, and shall remain, the exclusive property
        of
        the Company and shall be promptly delivered to the Company, with no copies
        or
        reproductions retained by Associate, in the event of Associate’s termination for
        any reason, or at any other time or times the Company may
        request.  Upon termination of employment for any reason, Associate
        agrees to sign and deliver the “Termination Certification” attached hereto
        as  Appendix B.

      


      (g)           Reasonable
        Restrictions.  Associate agrees and acknowledge that the restrictions
        contained in this Agreement are reasonable and necessary in order to protect
        the
        valuable propriety assets, goodwill and business of the Company and that
        the
        restrictions will not prevent or unreasonably restrict his ability to earn
        a
        livelihood.  Associate also agrees and acknowledges that if his
        employment with the Company ends for any reason, Associate will be able to
        earn
        a livelihood without violating the restrictions contained in this Agreement
        and
        that Associate’s ability to earn a livelihood without violating said
        restrictions is an important reason in Associate choosing to sign this
        Agreement.

      


      7.           Remedies.  The
        Associate expressly agrees that the remedy at law for any breach of the
        provisions of Section 6 will be inadequate and that upon any such breach
        or
        threatened breach, the Company shall be entitled, as a matter of right, to
        injunctive relief in any court of competent jurisdiction, in equity or
        otherwise, to enforce the specific performance of the Associate’s obligations
        under these provisions without the necessity of proving the actual damage
        to the
        Company or the inadequacy of a legal remedy.

      


      
        
          
          

        

        
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      8.           Termination
        Without Compensation.

      


      (a)           The
        Employment Term will terminate as of the end of the term of this Agreement
        unless terminated earlier in accordance with this Section 8, Section 9, Section
        10, or Section 11.

      


      (b)           The
        Employment Term may also be terminated by the Company for cause ("Cause")
        with
        written notice to the Associate upon the occurrence of any of the
        following:

      


      (i)           the
        commission by the Associate of any deliberate and premeditated act involving
        moral turpitude detrimental to the economic interests of the
        Company;

      


      (ii)           the
        conviction of the Associate of a felony;

      


      (iii)           the
        willful failure or refusal of the Associate to perform his duties hereunder
        (which failure or refusal persists after written notice from the Company
        to the
        Associate complaining of such failure or refusal) or the Associate’s gross
        negligence of a material nature in connection with the performance of such
        duties; or

      


      (iv)           the
        breach by the Associate of any provision of this Agreement which is not cured
        within thirty (30) days subsequent to written notice from the Company to
        the
        Associate of the breach.

      


      (c)           Upon
        termination of the Employment Term under subsections (a) or (b) above, the
        parties hereto will be relieved of any further obligations hereunder except
        for
        any obligations set forth in Section 6.

      


      9.           Termination
        Without Cause.  The Company shall have the right to terminate the
        Employment Term without Cause at any time.  If the termination is
        effected by the Company other than as described in Section 8, then under
        such
        circumstances, (i) the Associate’s Base Salary then in effect hereunder
        will continue to be payable in accordance with the Company's payroll policy
        through the Employment Term, (ii) the Associate shall be paid within 60
        days after termination the pro rata portion of the Bonus earned, if any,
        through
        the date of termination, and (iii) all unvested Restricted Stock (if any)
        and
        stock options shall immediately vest in full without regard to the achievement
        of any applicable performance goals.

      


      10.           Death
        of the Associate.  If the Associate dies during the Employment
        Term, the Employment Term shall terminate, and within 60 days after death,
        or as
        soon thereafter as administratively practicable, the Company will pay to
        the
        Associate’s estate (i) the Associate’s Base Salary then in effect through
        the end of the calendar month in which such death occurs, and (ii) the pro
        rata portion of the Bonus earned, if any, through the date of
        death.  In addition, as shall be more specifically set forth in the
        Stock Option Agreement between the Parent Company and Associate, the
        non-qualified stock option which is the subject of Section 4(c) herein, shall
        vest, on a pro rata basis with respect to the fiscal year in which the date
        of
        death occurs, based upon the achievement of the economic profit per share
        goal
        for the applicable fiscal year, without regard to future Give-Back and Claw-Back
        provisions.

      


      
        
          
          

        

        
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      11.           Termination
        Following Disability.  If the Associate becomes disabled during
        the Employment Term, the Company may terminate the Employment Term, in which
        event the Company will pay to the Associate the Associate’s Base Salary then in
        effect, payable in accordance with the Company's payroll policy through the
        end
        of the Employment Term; provided, however, any amounts payable to the Associate
        under the Company’s disability insurance policy shall be deducted from the
        amounts payable to the Associate hereunder.  For the purposes of this
        Agreement, the Associate shall be deemed to be "disabled" when he is deemed
        to
        be disabled under the Company’s disability insurance policy or, if the Company
        does not have a disability insurance policy for the Associate, the Associate
        shall be deemed disabled if he is unable to perform his services or discharge
        his duties as an Associate of the Company for ninety (90) or more consecutive
        days or one hundred twenty (120) days in the aggregate in any twelve (12)
        month
        period.  Any disability, as defined herein, shall not constitute
        "cause" for purposes of Section 8(b) hereof.  In addition, as shall be
        more specifically set forth in the Stock Option Agreement between the Parent
        Company and Associate, the non-qualified stock option which is the subject
        of
        Section 4(c) herein, shall vest, on a pro rata basis with respect to the
        fiscal
        year in which the date of disability occurs, based upon the achievement of
        the
        economic profit per share goal for the applicable fiscal year, without regard
        to
        future Give-Back and Claw-Back provisions.

      


      12.           Change
        in Control of the Parent Company

      


      (a)           In
        the event of a change in control of the Parent Company while the Associate
        is
        still employed under this Agreement, on the date the change in control becomes
        effective, (i) the Company shall pay to the Associate a lump sum cash payment
        equal to 2.99 times the "base amount" with respect to the Associate’s
        compensation, as such term is defined in Section 280G of the Internal Revenue
        Code of 1986, as amended, and regulations and guidance issued thereunder
        (the
        "Code"); and (ii) all unvested Restricted Stock and stock options previously
        granted by the Parent Company to the Associate shall vest in full, without
        regard to the achievement of any applicable performance goals (collectively,
        (i)
        and (ii) are referred to as the "Change in Control Payments").  If,
        prior to the change in control, the Company terminates the Employment Term
        without Cause in connection with the change in control, then the Associate
        shall
        be treated for purposes of this Section 12 as being employed on the date
        the
        change in control becomes effective.

      


      (b)           For
        purposes of this Section 12,
“change
        in control” of the Parent
        Company shall mean:

      


      
        
          
          

        

        
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      (i)           Change
        in Ownership.  The
        acquisition by an individual, entity or group (within the meaning of Code
        Section 409A) (a "Person") of ownership of stock of the Parent Company that,
        together with stock held by such Person, constitutes more than 50% of the
        total
        fair market value or total voting power of the stock of the Parent
        Company.  However, if any Person is considered to own more than 50% of
        the total fair market value of total voting power of the stock of the Parent
        Company, the acquisition of additional stock by the same Person is not
        considered to cause a change in ownership of the Parent Company (or to cause
        a
        change in the effective control of the Parent Company).  An increase
        in the percentage of stock owned by any one Person as a result of a transaction
        in which the Parent Company acquires its stock in exchange for property will
        be
        treated as an acquisition of stock for purposes of this
        paragraph.  This paragraph applies only when there is a transfer of
        stock of the Parent Company (or issuance of stock of the Parent Company)
        and
        stock in the Parent Company remains outstanding after the transaction;
        or

      


      (ii)           Change
        in Effective
        Control.  (A) the acquisition by an individual, entity or group
        (within the meaning of Code Section 409A) (a "Person") during the 12-month
        period ending on the date of the most recent acquisition by such Person,
        of
        ownership of stock of the Parent Company possessing 35% or more of the total
        voting power of the stock of the Parent Company; or (B) the replacement of
        a
        majority of members of the Parent Company's Board of Directors during any
        12-month period by directors whose appointment or election is not endorsed
        by a
        majority of the members of the Parent Company's Board of Directors prior
        to the
        date of the appointment or election.

      


      A
        change in effective control also may
        occur in any transaction in which either of the two corporations involved
        in the
        transaction has a "Change in Ownership" under paragraph (i) or "Change in
        Ownership of a Substantial Portion of the Company's Assets" under paragraph
        (iii).  If any one Person is considered to effectively control the
        Parent Company, the acquisition of additional control of the Parent Company
        by
        the same Person is not considered to cause a change in the effective control
        of
        the Parent Company (or to cause a "Change in Ownership" of the Parent Company
        within the meaning of paragraph (i) above); or

      


      (iii)           Change
        in Ownership of a Substantial
        Portion of Assets.  The acquisition by an individual, entity or group
        (within the meaning of Code Section 409A) (a "Person") during the 12-month
        period ending on the date of the most recent acquisition by such Person,
        of
        assets from the Parent Company that have a total gross fair market value
        equal
        to or more than 40% of the total gross fair market value of all of the assets
        of
        the Parent Company immediately prior to such acquisition(s).  For this
        purpose, gross fair market value means the value of the assets of the Parent
        Company, or the value of the assets being disposed of, determined without
        regard
        to any liabilities associated with such assets.  No change in control
        shall be deemed to have occurred in the event of a transfer to a related
        person
        or as described in Code Section 409A.

      


      The
        definition of change in control in
        this Subsection 12(b), and all other terms and provisions of this Agreement,
        shall be interpreted at all times in such a manner as to comply with Code
        Section 409A, meaning that no additional income tax is imposed on the Associate
        pursuant to Code Section 409A(1)(a).

      


      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

         

      

      (c)           The
        Change in Control Payments shall be in addition to any other rights and benefits
        for which the Associate is eligible, either by way of contract or with respect
        to rights and benefits generally available to other executive officers or
        Associates of the Company.

      


      (d)           If
        it is determined that any payment, benefit or distribution of any type that
        is
        made by the Company, the Parent Company, any of their affiliates, or any
        person,
        in connection with a change in control or a termination of the Associate’s
        employment thereafter, to or for the benefit of the Associate, whether paid
        or
        payable or distributed or distributable pursuant to the terms of this Agreement
        or otherwise (the “Total Payments”), would be subject to excise taxes imposed by
        Code Section 4999, or any interest or penalties with respect to such excise
        tax
        (such excise tax and any such interest or penalties are collectively referred
        to
        as the “Excise Tax”), then the Associate shall be entitled to receive a one-time
        additional payment (a “Gross-Up Payment”) in an amount reasonably determined by
        the Accounting Firm (as defined below) to be equal to such Excise
        Tax.  Payments under this Section are payable to the Associate even if
        the Associate is not eligible for termination benefits under this Agreement,
        and
        are subject to the following rules:

      


      (i)           Determination
        by Accountant.  All determinations and calculations required to be
        made under this Section shall be made by the Company's regular accounting
        firm
        (the “Accounting Firm”), which shall provide its determination (the
“Determination”), together with detailed supporting calculations regarding the
        amount of any Gross-Up Payment and any other relevant matter, both to the
        Company and the Associate within five days of the termination of the Associate’s
        employment, if applicable, or such earlier time as is requested by the Company
        or the Associate (if the Associate reasonably believes that any of the Total
        Payments may be subject to the Excise Tax).  If the Accounting Firm
        determines that no Excise Tax is payable by the Associate, it shall furnish
        the
        Associate with a written statement that such Accounting Firm has concluded
        that
        no Excise Tax is payable (including the reasons therefor) and that the Associate
        has substantial authority not to report any Excise Tax on the Associate’s
        federal income tax return.  If a Gross-Up Payment is determined to be
        payable, it shall be paid to the Associate within five days after the
        Determination is delivered to the Company or the Associate.  Any
        determination by the Accounting Firm shall be binding upon the Company and
        the
        Associate.  In all events, gross-up payments shall be made by the end
        of the calendar year following the calendar year in which the Associate remits
        the excise taxes.

      


      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

         

      

      (ii)           Over-
        and Underpayments.  As a result of uncertainty in the application of
        one or more Code provisions at the time of the initial determination by the
        Accounting Firm hereunder, it is possible that Gross-Up Payments not made
        by the
        Company should have been made (“Underpayment”), or that Gross-Up Payments will
        have been made by the Company which should not have been made
        (“Overpayments”).  In either such event, the Accounting Firm shall
        determine the amount of the Underpayment or Overpayment that has
        occurred.  In the case of an Underpayment, the amount of such
        Underpayment shall be promptly paid by the Company to or for the benefit
        of the
        Associate.  In the case of an Overpayment, the Associate shall, at the
        direction and expense of the Company, take such steps as are reasonably
        necessary (including the filing of returns and claims for refund), follow
        reasonable instructions from, and procedures established by, the Company,
        and
        otherwise reasonably cooperate with the Company to correct such Overpayment,
        provided, however, that (i) the Associate shall in no event be obligated
        to
        return to the Company an amount greater than the net after-tax portion of
        the
        Overpayment that the Associate has retained or has recovered as a refund
        from
        the applicable taxing authorities and (ii) this provision shall be interpreted
        in a manner consistent with the intent of Subsection (a) above, which is
        to make
        the Associate whole, on an after-tax basis, from the application of the Excise
        Tax, it being understood that the correction of an Overpayment may result
        in the
        Associate’s repaying to the Company an amount which is less than the
        Overpayment.

      


      13.           Definition
        of Termination of Employment.  "Termination of Employment" as used
        in this Agreement to determine the date of any payment, shall mean the date
        of
        the Associate’s “separation from service” as defined by Code Section
        409A.

      


      14.           Specified
        Employee Delay.  If the Associate is a "specified employee" within
        the meaning of Code Section 409A, any benefits or payments (including
        installments and insurance premiums and contributions) which (a) constitute
        a
        "deferral of compensation" under Code Section 409A, (b) become payable as
        a
        result of the Associate's termination of employment for reasons other than
        death, and (c) become due under this Agreement during the first six (6) months
        (or such longer period as required by Code Section 409A) after termination
        of
        employment shall be delayed and all such delayed payments (or delayed
        installments, premiums or contributions) shall be paid to the Associate in
        full
        in the seventh (7th) month
        after the
        date of termination and all subsequent payments (or installments) shall be
        paid
        in accordance with their original payment schedule.  To the extent
        that any insurance premiums or other benefit contributions
        constituting  a "deferral of compensation" become subject to the above
        delay, the Associate shall be responsible for paying such amounts directly
        to
        the insurer or other third party and shall receive reimbursement from Company
        for such amounts in the seventh (7th) month
        as
        described above.   This paragraph shall not apply to payments
        made as a result of a termination of employment that is the result of the
        Associate's death.

      


      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

         

      

      15.           Notices.  All
        notices, demands and requests which may be given or which are required to
        be
        given by either party to the other, and any exercise of a right of termination
        provided by this Agreement, shall be in writing and shall be deemed effective
        when either:  (a) personally delivered to the intended recipient;
        (b) sent by certified or registered mail, return receipt requested,
        addressed to the intended recipient at the address specified below;
        (c) delivered in person to the address set forth below for the party to
        which the notice was given; (d) deposited into the custody of a nationally
        recognized overnight delivery service such as Federal Express Corporation,
        Emery
        or Purolator, addressed to such party at the address specified below; or
        (e) sent by facsimile, telegram or telex, provided that receipt for such
        facsimile, telegram or telex is verified by the sender and followed by a
        notice
        sent in accordance with one of the other provisions set forth
        above.  Notices shall be effective on the date of delivery, or receipt
        of, if delivery is not accepted, on the earlier of the date that delivery
        is
        refused or three (3) days after the date the notice is mailed.  For
        purposes of this paragraph, the addresses of the parties for all notices
        are as
        follows (unless changes by similar notice in writing are given by the particular
        person whose address is to be changed):

      


      If
        to the
        Associate, to Jeffrey A. Williams, ____________________________
        ________________________________________________;

      


      If
        to the
        Company, to America’s Car-Mart, Inc., 802 S. E. Plaza Avenue, Suite 200,
        Bentonville, Arkansas 72712, Fax #479-273-7556.

      


      With
        a
        copy to Lisa L. Kelley, Chief Legal Officer, 802 S. E. Plaza Avenue, Suite
        200,
        Bentonville, Arkansas 72712, Fax #479-271-0796;

      


      And
        a
        copy to Jeffrey A. Williams, Chief Financial Officer, 802 S. E. Plaza Avenue,
        Suite 200, Bentonville, Arkansas 72712, Fax #479-464-4234.

      


      Any
        party
        hereto may designate a different address by written notice given to the other
        parties.

      


      16.           Governing
        Law.  This agreement shall be construed in accordance with and
        governed by the laws of the State of Arkansas.

      


      17.           Assignability.  The
        Associate may not assign his interest in or delegate his duties under this
        Agreement.  The rights and obligations of the Company hereunder may be
        assigned only by operation of law in connection with a merger in which the
        Company is not the surviving corporation or in connection with the sale of
        substantially all of the assets of the Company; and in the latter event,
        such
        assignment shall not relieve the Company of its obligations
        hereunder.

      


      18.           Binding
        Effect.  This Agreement shall be binding upon and inure to the
        benefit of the Company, its successors and assigns.

      


      19.           Entire
        Agreement; Modification.  This Agreement constitutes the entire
        agreement of the parties hereto with respect to the subject matter hereof
        and
        may not be modified or amended in any way except in writing by the parties
        hereto.  This Agreement supersedes and replaces any and all prior
        employment agreements between the Company and the Associate, all of which
        are
        hereby terminated and declared null and void; provided, however, this Agreement
        shall not affect, in any manner, previously awarded Restricted Stock or stock
        options, which awards shall remain in full force and effect in accordance
        with
        the terms of such previous awards.

      


      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

         

      

      20.           Duration.  Notwithstanding
        the termination of the Employment Term and of the Associate’s employment by the
        Company, this Agreement shall continue to bind the parties for so long as
        any
        obligations remain under this Agreement, and, in particular, the Associate
        shall
        continue to be bound by the terms of Section 6.

      


      21.           Waiver.  No
        waiver by the Company of any breach by the Associate of this Agreement shall
        be
        construed to be a waiver as to succeeding breaches.

      


      22.           Enforceability.  The
        covenants and provisions contained herein are severable and are to be
        interpreted as such to the extent permitted by applicable law.  The
        parties understand, acknowledge and agree that should any provision of this
        Agreement be declared or determined by any court of competent jurisdiction
        to be
        unenforceable or invalid for any reason, the validity of the remaining parts,
        terms or provisions of this Agreement shall not be affected thereby, and
        that
        the Agreement will be amended to delete or modify, as necessary, any invalid
        or
        unenforceable parts, terms or provisions to the extent necessary to allow
        for
        enforcement.

      


      23.           Counterparts.  This
        Agreement may be executed in counterparts, each of which shall be deemed
        an
        original but all of which together shall constitute one and the same
        agreement.

      


      IN
        WITNESS WHEREOF, the parties have executed this Agreement on _____________,
        2007, but this Agreement shall be effective as of the day and year first
        above
        written.

      


                                          COMPANY:

      


                                          AMERICA’S
        CAR-MART,
        INC., an

                                          Arkansas
        corporation

      


                                          By:  _______________________________________________  

                                          Name: _____________________________________________  

                                          Title: ______________________________________________  

      


                                          ASSOCIATE:

       

      
                                                                                    __________________________________________________

      

                                                                                
         Jeffrey A. Williams

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

         

      

      APPENDIX
        A

      


      Applicable
        to the Cash Bonus and Non-Qualified Stock Options

      pursuant
        to Sections 4(b) and 4(c) of Employment Agreement

      


      
        	
                Projected
                  Economic Profits

                Fiscal
                  2008-2010

              	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                Subject
                  to 

                Adjustment

              	 	
                Subject
                  to 

                Adjustment

              
	 	 	 	 	 	
                Projected

              	 	
                Projected

              	 	
                Projected

              
	 	 	 	 	 	
                2008

              	 	
                2009

              	 	
                2010

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  GAAP Net Income

              	 	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Add:
                  Projected Provision for Income Taxes

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Add:
                  Projected Interest Expense

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Net Operating Profit before taxes

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Taxes @ 37%

              	 	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 
	
                Projected
                  Net Operating Profit After Taxes

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 
	
                Projected
                  Year-end Total Assets

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Year-end Total Liabilities

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	 	
                Projected
                  Year-end Net Assets

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Debt

              	 	 	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Other-
                  Cumulative Net of Tax interest expense

              	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Year-End Economic Capital

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Net Operating Profit After Taxes

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Capital Charge- 5.7% after tax

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              	 	
                $[XXXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Year
                  1 adjustment

              	 	 	 	
                -$[XXX]*

              	 	 	 	 
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Economic Profit

              	 	 	
                $[XXX]*

              	 	
                $[XXX]*

              	 	
                $[XXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Projected
                  Economic Profit per Share

              	 	
                $[XXX]*

              	 	
                $[XXX]*

              	 	
                $[XXX]*

              
	 	 	 	 	 	 	 	 	 	 
	
                Goal
                  set for 2008 @

              	 	 	
                $[XXX]*

              	 	 	 	 


      

      


      *Filed
        under application for confidential treatment.

       

      
        
          
          

        

        
          A-1

          
            

          

        

        
          
          

        

         

      

      APPENDIX
        A

      


      Award
        Percentages Earned- Rounded to
        nearest whole percentage point

      


      
        	
                Percentage
                  of

              	 	 	
                Award
                  Percentage

              	 
	
                Projection

              	 	 	
                Earned

              	 
	 	 	 	 	 
	 	85	%	 	 	80	%
	 	86	%	 	 	81	%
	 	87	%	 	 	83	%
	 	88	%	 	 	84	%
	 	89	%	 	 	85	%
	 	90	%	 	 	87	%
	 	91	%	 	 	88	%
	 	92	%	 	 	89	%
	 	93	%	 	 	91	%
	 	94	%	 	 	92	%
	 	95	%	 	 	94	%
	 	96	%	 	 	95	%
	 	97	%	 	 	96	%
	 	98	%	 	 	98	%
	 	99	%	 	 	99	%
	 	100	%	 	 	100	%
	 	101	%	 	 	102	%
	 	102	%	 	 	103	%
	 	103	%	 	 	104	%
	 	104	%	 	 	106	%
	 	105	%	 	 	107	%
	 	106	%	 	 	108	%
	 	107	%	 	 	110	%
	 	108	%	 	 	111	%
	 	109	%	 	 	112	%
	 	110	%	 	 	114	%
	 	111	%	 	 	115	%
	 	112	%	 	 	116	%
	 	113	%	 	 	118	%
	 	114	%	 	 	119	%
	 	115	%+	 	 	120	%
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 


      

       

       

      
        
          
          

        

        
          A-2

          
            

          

        

        
          
          

        

      

      


      APPENDIX
        B

      


      


      TERMINATION
        CERTIFICATION

      


      The
        undersigned Associate certifies
        that he/she does not possess and has not failed to return any property belonging
        to AMERICA’S CAR-MART, INC. its parent, subsidiaries, affiliates, successors or
        assigns (together, the “Company”) or its customers, including, but not limited
        to, equipment, devices, records, correspondence, documents, files, reports,
        studies, manuals, compilations, drawings, blueprints, sketches, videos,
        memoranda, computer software and programs, data or any other information,
        including Trade Secrets and Confidential Information as set forth herein,
        (whether originals, copies or extracts, stored in any medium), whether prepared
        or developed by Associate or otherwise coming into Associate’s possession,
        whether maintained by Associate in the facilities of the Company, at Associate’s
        home, or at any other location.

      


      Associate
        further certifies that he/she
        will comply with all the terms of his/her Non-Competition, Non-Solicitation,
        Non-Disclosure, and Confidentiality Agreement.

      


      


      
        	Date:
                ____________________ 	 	 _______________________________________________________
	 	 	
                Associate

              


      

       

      B-1