Document:

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                                                                   Exhibit 10.35

                       FOURTH AMENDMENT AND LIMITED WAIVER
                                       TO
                      AMENDED AND RESTATED CREDIT AGREEMENT

      THIS FOURTH AMENDMENT AND LIMITED WAIVER TO AMENDED AND RESTATED CREDIT
AGREEMENT, dated as of December 31, 2001 (this "Fourth Amendment") relates to
that certain Amended and Restated Credit Agreement dated as of February 10, 1999
(as amended by the First Amendment to Amended and Restated Credit Agreement,
dated April 28, 2000 (the "First Amendment"), the Second Amendment to Amended
and Restated Credit Agreement, dated as of December 29, 2000 (the "Second
Amendment") and the Third Amendment to Amended and Restated Credit Agreement,
dated as of March 19, 2001 (the "Third Amendment"), and as may be further
amended, supplemented, restated or otherwise modified from time to time, the
"Credit Agreement") and is entered into among Callaway Golf Company, a Delaware
corporation (the "Borrower"), the other credit parties signatory to the Credit
Agreement, the lenders signatory hereto (the "Requisite Lenders") and General
Electric Capital Corporation, a New York corporation, as agent for the Lenders
(in such capacity, the "Agent"). Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the Credit Agreement.

                               W I T N E S S E T H

      WHEREAS, the Borrower, the other Credit Parties, Agent and the Lenders
have entered into the Credit Agreement, the First Amendment, the Second
Amendment and the Third Amendment;

      WHEREAS, Callaway Golf South Pacific Pty Ltd ("CGSP") is a wholly owned
subsidiary of Borrower and Borrower has advanced certain sums to CGSP (the
"Intercompany Debt");

      WHEREAS, CGSP and Borrower have agreed to convert into equity a portion of
the Intercompany Debt, whereby Borrower will receive 500,000 of the ordinary
shares of CGSP in exchange for a A$500,000 reduction of the Intercompany Debt
(as more fully described in Schedule A attached hereto, the "Recapitalization");

      WHEREAS, Borrower has requested that Agent and the Requisite Lenders grant
a limited waiver (the "Limited Waiver") to Section 6.5 of the Credit Agreement
(Capital Structure and Business), solely with respect to the Recapitalization;

      WHEREAS, Borrower has requested that the Credit Agreement be amended to
exclude the issuance of shares of Stock in payment of advances made by Borrower
to its Subsidiaries from the limitations provided in Section 6.5 of the Credit
Agreement (the "Amendment");

      WHEREAS, Section 11.2 of the Credit Agreement requires that the Requisite
Lenders consent to the Limited Waiver and the Amendment; and

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT

<PAGE>

      WHEREAS, Agent, Borrower and Requisite Lenders are willing to provide the
Limited Waiver and Amendment on the terms and conditions set forth herein.

      NOW, THEREFORE, in consideration of the above premises, Borrower, Agent,
and the Requisite Lenders agree as follows:

      1. Definitions and Usage. Capitalized terms used, but not defined, herein
have the meanings ascribed to such terms in the Credit Agreement. Any reference
herein to Section, Exhibit or Schedule shall, unless otherwise specified, refer
to such Section, Exhibit or Schedule hereof, in its entirety.

      2. Amendment to the Credit Agreement. Upon the Effective Date (as defined
in Section 5 below), Section 6.5(b) of the Credit Agreement is hereby amended by
deleting the text thereof in its entirety and substituting the following in lieu
thereof:

      "make any change in its capital structure as described on Disclosure
      Schedule (3.8), including the issuance of any shares of Stock, warrants or
      other securities convertible into Stock or any revision of the terms of
      its outstanding Stock, except (i) to the extent permitted by Section
      6.13(ii) or Section 6.14, (ii) as a result of a Reincorporation Merger,
      (iii) that Special Purpose Corporation may issue Stock in connection with
      the Receivables Facility and (iv) that Borrower may make a Public Offering
      of its common Stock so long as (A) the proceeds thereof are applied in
      prepayment of the Obligations as required by Section 1.3(b)(iii), and (B)
      no Change of Control occurs after giving effect thereto"

      3. Limited Waiver. Upon the Effective Date, and as limited herein, the
Requisite Lenders hereby waive Section 6.5 of the Credit Agreement (Capital
Structure and Business), solely with respect to the Recapitalization.

      The Limited Waiver shall be limited to those Events of Default, if any,
arising solely from the Recapitalization as described herein and do not apply to
any past, present or future Events of Default caused by any other violation of
Sections 5 or 6 or other provisions of the Credit Agreement or any of the Loan
Documents.

      4. Representations and Warranties. The Credit Parties hereby jointly and
severally represent and warrant to the Agent and the Requisite Lenders that, as
of the Effective Date and after giving effect to this Fourth Amendment:

            a. All of the representations and warranties of the Credit Parties
      contained in this Fourth Amendment, the Credit Agreement and the other
      Loan Documents are true and correct in all material respects on and as of
      the Effective Date, as if then made (other than representations and
      warranties which expressly speak as of a different date, which shall be
      true and correct in all material respects as of that date); and

            b. No Default or Event of Default has occurred and is continuing or
      will result after giving effect to this Fourth Amendment.

                                       2

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT

<PAGE>

      5. Effective Date. This Fourth Amendment shall become effective as of the
date first written above (the "Effective Date") upon the satisfaction of each of
the following conditions:

            a. The Agent shall have received each of the following documents, in
      each case in form and substance satisfactory to the Agent:

                  i. counterparts hereof executed by each of the Credit Parties,
            the Agent and the Requisite Lenders;

                  ii. duly executed amendments to the Receivables Documents
            effecting all modifications necessary to permit the
            Recapitalization, together with a certificate of the Chief Financial
            Officer of the Borrower certifying that all conditions to the
            effectiveness of the amendments have been satisfied and that the
            amendments are in full force and effect as of the Effective Date;

                  iii. the duly executed Pledge Agreement reflecting the
            Recapitalization, accompanied by (y) the share certificate
            representing sixty-five percent (65%) of the 500,000 ordinary shares
            of CGSP being issued to Borrower pursuant to the Recapitalization,
            which 325,000 ordinary shares of CGSP are being pledged in
            accordance with the Credit Agreement, and (z) a stock power for such
            share certificate executed in blank;

                  iv. a certificate of the Secretary or Assistant Secretary of
            each of the Credit Parties dated the Effective Date certifying (A)
            that the bylaws of such Credit Party have not been amended or
            otherwise modified since the date of the most recent certification
            thereof by the Secretary or Assistant Secretary of such Credit Party
            delivered to the Agent and remain in full force and effect as of the
            Effective Date, (B) that the charter of such Credit Party has not
            been amended or otherwise modified since the date of the most recent
            certification thereof by the Secretary of State of such Credit
            Party's jurisdiction of incorporation delivered to the Agent and
            remain in full force and effect as of the Effective Date and (C)
            that the execution, delivery and performance of this Fourth
            Amendment have been duly authorized by all necessary or proper
            corporate and shareholder action; and

                  v. such additional documentation as the Agent may reasonably
            request;

            b. No law, regulation, order, judgment or decree of any Governmental
      Authority shall, and the Agent shall not have received any notice that
      litigation is pending or threatened which is likely to, enjoin, prohibit
      or restrain the consummation of the transactions contemplated by this
      Fourth Amendment, except for such laws, regulations, orders or decrees, or
      pending or threatened litigation, that in the aggregate could not
      reasonably be expected to have a Material Adverse Effect;

            c. All corporate and other proceedings, and all documents,
      instruments and other legal matters in connection with the transactions
      contemplated by this Fourth Amendment shall be satisfactory in all
      respects in form and substance to the Agent; and

                                       3

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT

<PAGE>
            d. No Default or Event of Default shall have occurred and be
      continuing on the Effective Date or will result after giving effect to
      this Fourth Amendment.

      6. Reference to and Effect on the Loan Documents.

            a. Upon the Effective Date, each reference in the Credit Agreement
      to "this Agreement", "hereunder", "hereof" or words of like import, and
      each reference in the other Loan Documents to the Credit Agreement, shall
      mean and be a reference to the Credit Agreement as amended and
      supplemented hereby.

            b. Except to the extent specifically set forth herein, the
      respective provisions of the Credit Agreement and the other Loan Documents
      shall not be amended, modified, waived, impaired or otherwise affected
      hereby, and such documents and the Obligations under each of them are
      hereby confirmed as being in full force and effect.

            c. This Fourth Amendment shall be limited solely to the matters
      expressly set forth herein and shall not (i) constitute an amendment or
      waiver of any other term or condition of the Credit Agreement or any other
      Loan Document, (ii) prejudice any right or rights which the Agent or any
      Lender may now have or may have in the future under or in connection with
      the Credit Agreement or any other Loan Document, (iii) require the Agent
      or any Lender to agree to a similar transaction on a future occasion or
      (iv) create any right herein to another Person or other beneficiary or
      otherwise, except to the extent specifically provided herein.

      7. Miscellaneous. This Fourth Amendment is a Loan Document. The headings
herein are for convenience of reference only and shall not alter or otherwise
affect the meaning hereof.

      8. Section Titles. The Section titles in this Fourth Amendment are and
shall be without substantive meaning or content of any kind whatsoever and are
not a part of the agreement between the parties hereto.

      9. Counterparts. This Fourth Amendment may be executed in any number of
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.

      10. GOVERNING LAW. THIS FOURTH AMENDMENT, AND ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE HEREOF, SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

      11. No Strict Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Fourth Amendment. In the event an
ambiguity or question of intent or interpretation arises, this Fourth Amendment
shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Fourth Amendment.

                                       4

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT

<PAGE>

      IN WITNESS WHEREOF, the Credit Parties, the Agent and the Requisite
Lenders have caused this Fourth Amendment to be executed by their respective
officers thereunto duly authorized as of the date first above written.

                                         CALLAWAY GOLF COMPANY,
                                         as Borrower

                                         By:      ______________________________
                                                  Name:
                                                  Title:

                             Signature Page 1 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                         CALLAWAY GOLF SALES COMPANY,
                                         as a Credit Party

                                         By:      ______________________________
                                                  Name:
                                                  Title:

                              Signature Page 2 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                         GENERAL ELECTRIC CAPITAL CORPORATION,
                                         as Agent and Lender

                                         By:      /s/ Robert Yasuda
                                                  ------------------------------
                                                  Name:  Robert Yasuda
                                                  Title:  Authorized Signatory
                                                  Pro Rata Share:  20.83%

                             Signature Page 3 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                         AMERICAN NATIONAL BANK AND TRUST
                                         COMPANY OF CHICAGO,
                                         as a Lender

                                         By:      ______________________________
                                                  Name:
                                                  Title:
                                                  Pro Rata Share:  17.71%

                             Signature Page 4 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                         BANK OF AMERICA, NATIONAL ASSOCIATION,
                                         as a Lender

                                         By:      ______________________________
                                                  Name:
                                                  Title:
                                                  Pro Rata Share:  14.17%

                             Signature Page 5 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                         CONGRESS FINANCIAL CORPORATION
                                         (WESTERN),
                                         as a Lender

                                         By:      ______________________________
                                                  Name:
                                                  Title:
                                                  Pro Rata Share:  14.17%

                             Signature Page 6 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                            KEY CORPORATE CAPITAL INC.,
                                            as a Lender

                                            By:      ___________________________
                                                     Name:
                                                     Title:
                                                     Pro Rata Share:  14.17%

                             Signature Page 7 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                            NATIONAL CITY COMMERCIAL FINANCE,
                                            INC., as a Lender

                                            By:      ___________________________
                                                     Name:
                                                     Title:
                                                     Pro Rata Share:  8.33%

                              Signature Page 8 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                            NATIONAL WESTMINSTER BANK PLC,
                                            as a Lender

                                            By:      ___________________________
                                                     Name:
                                                     Title:
                                                     Pro Rata Share: 10.63%

                             Signature Page 9 of 9

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                    EXHIBIT A

                                       TO

             LIMITED WAIVER TO AMENDED AND RESTATED CREDIT AGREEMENT

                                 (see attached)

                                   Exhibit A

                                                             FOURTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT<PAGE>
                                                                   EXHIBIT 10.36

                       FIFTH AMENDMENT AND LIMITED WAIVER
                                       TO
                      AMENDED AND RESTATED CREDIT AGREEMENT

            THIS FIFTH AMENDMENT AND LIMITED WAIVER TO AMENDED AND RESTATED
CREDIT AGREEMENT, dated as of February 25, 2003 (this "Fifth Amendment") relates
to that certain Amended and Restated Credit Agreement dated as of February 10,
1999 (as amended by the First Amendment to Amended and Restated Credit
Agreement, dated April 28, 2000, the Second Amendment to Amended and Restated
Credit Agreement, dated as of December 29, 2000, the Third Amendment to Amended
and Restated Credit Agreement, dated as of March 19, 2001 and the Fourth
Amendment to Amended and Restated Credit Agreement, dated as of December 31,
2001, the "Credit Agreement") and is entered into among Callaway Golf Company, a
Delaware corporation (the "Borrower"), the other credit parties signatory to the
Credit Agreement, the lenders signatory hereto (the "Requisite Lenders") and
General Electric Capital Corporation, a Delaware corporation, as the agent for
the Lenders (in such capacity, the "Agent"). Capitalized terms used and not
otherwise defined herein shall have the meanings assigned to them in the Credit
Agreement.

                               W I T N E S S E T H

            WHEREAS, the Borrower, the other Credit Parties, the Agent and the
Lenders have entered into the Credit Agreement.

            WHEREAS, as of the Fiscal Quarter ending September 30, 2002 (the
"Third Quarter 2002") the Borrower failed to meet the minimum Fixed Charge
Coverage Ratio for such period, as required by Section 6.10 (Financial
Covenants) of the Credit Agreement (the "Financial Covenant Event of Default").

            WHEREAS, the following other Events of Default exist and are
continuing under the Credit Agreement:

            a.    the Borrower's failure to deliver when due the Compliance
      Certificates for each of the Third Quarter 2002 and the Fiscal Quarter
      ending December 31, 2002 (the "Fourth Quarter 2002");

            b.    the Borrower's failure to report the Financial Covenant Event
      of Default and the Compliance Certificate Event of Default in its
      certification of the Third Quarter 2002 financial statements and monthly
      financial statements for the months of August 2002 through and including
      December 2003, each as required by Annex E to the Credit Agreement and the
      failure to make certain certifications in connection therewith;

            c.    the Borrower's failure to cause the periodic reports required
      under paragraphs (a)-(d) of Annex E to the Credit Agreement to be
      certified by the Chief Financial Officer of the Borrower;

                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
            d.    the Borrower's failure to deliver the reports and information
      required under paragraphs (a)-(g), (n) and (o) of Annex E to the Credit
      Agreement to the Lenders;

            e.    the Borrower's failure to provide a cash flow statement with
      the monthly financial information required under paragraph (a) of Annex E
      to the Credit Agreement;

            f.    the Borrower's failure to provide both the unaudited
      consolidated statements of income and cash flows in proper comparative
      form and the figures contained in the Projections, as required under
      paragraph (a) of Annex E to the Credit Agreement;

            g.    the Borrower's failure to deliver annual operating plans as
      required under paragraph (c) of Annex E to the Credit Agreement;

            h.    the Borrower's failure to deliver copies to the Agent and
      Lenders of (i) all Financial Statements, reports, notices and proxy
      statements made publicly available by any Credit Party to its security
      holders, (ii) all regular and periodic reports and all registration
      statements and prospectuses, if any, filed by any Credit Party with any
      securities exchange or with the Securities and Exchange Commission or any
      governmental or private regulatory authority and (iii) all press releases
      and other statements made available by any Credit Party to the public
      concerning material changes or developments in the business of any such
      Person, in each case as required under paragraph (g) of Annex E to the
      Credit Agreement;

            i.    the Borrower's failure to deliver notices of litigation as
      required under paragraph (j) of Annex E to the Credit Agreement;

            j.    the Borrower's failure to provide with the annual Financial
      Statements delivered to the Agent (i) a list of any applications for the
      registration of any Patent, Trademark, or Copyright with the United States
      Patent and Trademark Office, the United States Copyright Office or any
      similar office or agency which any Credit Party thereof has filed in the
      prior Fiscal Quarter and (ii) a summary of all Equipment and sales thereof
      by department and type, accompanied by supporting detail and
      documentation, all as required under paragraph (c) of Annex F to the
      Credit Agreement;

            k.    the Borrower's failure to deliver the results of each physical
      verification which the Borrower or any of its Subsidiaries have made of
      all or any portion of their Inventory, as required under paragraph (d) of
      Annex F to the Credit Agreement;

            l.    the Borrower's failure to deliver pursuant to paragraph (f) of
      Exhibit E to the Credit Agreement the default notices specifying the
      existence and nature of the Financial Covenant Event of Default, the
      Events of Default described in clauses (a) through (k) above and clause
      (m) below, the Investment Events of Default (as defined below), the
      Restricted Payment Events of Default (as defined below), and the
      Cross-Event of Default (as defined below);

            m.    the Borrower's failure to timely deliver any other reports and
      information required under Annex E and Annex F to the Credit Agreement
      prior to the date hereof

                                       2
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
      (together with the Events of Default described in paragraphs (a) through
      (l), above, the "Reporting Events of Default");

            n.    the Borrower's investments in investment categories other than
      those permitted under subsections (i)-(v) of Section 6.2(d) of the Credit
      Agreement;

            o.    the Borrower's failure to prevent its investment in GSOT from
      exceeding $87,000,000 at any time, as required under Section 6.2(f) of the
      Credit Agreement (together with the Event of Default described in
      paragraph (n), above, the "Investment Events of Default"); and

            p.    the Borrower's declaration of dividends and repurchases of
      Stock after the occurrence and during the continuation of the Financial
      Covenant Event of Default, the Reporting Events of Default, the Investment
      Events of Default and the Cross-Event of Default, which repurchases of
      stock were made without notification to Agent, each as prohibited by
      Sections 6.14(d) or (e) of the Credit Agreement (the "Restricted Payment
      Events of Default").

            WHEREAS, two Borrower Accounts (account #4126918259 at Wells Fargo
Bank, N.A. and account #890114096 at UBS PaineWebber, collectively the
"Non-blocked Accounts") were opened, and are being held, by the Borrower in
violation of Section 1.18 of the Credit Agreement (the "Cash Management Events
of Default").

            WHEREAS, one or more Termination Events and an Event of Servicer
Termination (each as defined in the Receivables Purchase Agreement) have
occurred under the Receivables Purchase Agreement and Section 8.1(m) of the
Credit Agreement provides that an Event of Default shall occur should any
Termination Event or Event of Servicer Termination occur and be continuing (the
"Cross-Event of Default" and, together with the Financial Covenant Event of
Default, the Reporting Events of Default, the Investment Events of Default, the
Restricted Payment Events of Default and the Cash Management Events of Default,
the "Events of Default").

            WHEREAS, in August 2002 the Borrower voluntarily prepaid in full the
CEF Lease Facility in an amount of $50,798,049.00 (the "Prepayment").

            WHEREAS, the Borrower has requested that the Agent and the Requisite
Lenders grant a limited waiver (the "Limited Waivers") to certain provisions of
the Credit Agreement, as follows and as provided in Section 3 below:

            a.    Section 1.8 (Cash Management Systems), solely with respect to
      the Cash Management Events of Default.

            b.    Section 4.1(a) (Reports and Notices), solely with respect to
      the Reporting Events of Default;

            c.    Sections 6.2 (Investments; Loans and Advances), solely with
      respect to the Investment Events of Default;

                                       3
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
            d.    Section 6.10 (Financial Covenants), solely with respect to the
      Financial Covenant Event of Default;

            e.    Section 6.14 (Restricted Payments), solely with respect to the
      Restricted Payment Events of Default; and

            f.    Section 8.1(m) (Events of Default), solely with respect to the
      Cross-Event of Default.

            WHEREAS, in connection with the termination of the Receivables
Facility, the Borrower has requested that Section 1.3(e) of the Credit Agreement
be amended to clarify the application of payments formerly received from the
Receivables Facility and Disclosure Schedule 3.19 shall be updated to reflect
the bank accounts held as of the Effective Date (as defined below) by the
Borrower, any other Credit Party and any of their respective Domestic
Subsidiaries (collectively, the "RPA Termination Amendments");

            WHEREAS, the Borrower has requested that the Credit Agreement be
amended to exclude the Prepayment from the calculation of the Fixed Charge
Coverage Ratio (the "Coverage Ratio Amendment").

            WHEREAS, the Borrower has requested that the Credit Agreement be
amended to permit the merger of Special Purpose Corporation with and into
Callaway Golf Sales Company, a California corporation ("CGSC") as soon as
commercially practicable after the termination of the Receivables Facility, with
CGSC as the surviving corporation (such amendment, the "Merger Amendments").

            WHEREAS, the Borrower has requested that the investment restriction
contained in Section 6.2(f) be amended to prohibit the Borrower from increasing
its equity interest participation in GSOT (together with the RPA Termination
Amendments, the Merger Amendments and the Coverage Ratio Amendment, the
"Amendments").

            WHEREAS, Section 11.2 of the Credit Agreement requires that the
Requisite Lenders consent to the Limited Waivers and the Amendments.

            WHEREAS, the Agent and the Requisite Lenders are willing to provide
the Limited Waivers and Amendments, in each case on the terms and conditions set
forth herein.

            NOW, THEREFORE, in consideration of the above premises, the
Borrower, the Agent, and the Requisite Lenders agree as follows:

      1.    Usage. Any reference herein to Section, Exhibit or Schedule, unless
otherwise specified, shall refer to such Section, Exhibit or Schedule hereof, in
its entirety.

      2.    Amendments to the Credit Agreement. Upon the Effective Date (as
defined in Section 5 below), the Credit Agreement is hereby amended as follows:

            a.    Section 1.3(e) is hereby amended by:

                                       4
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                  i.    Deleting the title of such section and substituting in
            lieu thereof the title "Application of Payments from the Collection
            Account"; and

                  ii.   Deleting the phrase "Payments deposited in the Agent
            Account in accordance with Section 2.04 or Article VI (or any
            comparable provisions) of the Receivables Purchase Agreement shall
            be applied as follows" and substituting in lieu thereof the phrase
            "Payments deposited in the Agent Account from the Collection Account
            in accordance with paragraph (b)(iii) of Annex C shall be applied as
            follows".

            b.    Section 6.2(f) is hereby amended by deleting the phrase
      "provided, that the aggregate amount thereof does not exceed $87,000,000
      at any time" and substituting in lieu thereof the phrase "provided, that
      the aggregate number of shares held by Borrower in connection with such
      investment shall not exceed 9,880,028 at any time (as such number of
      shares may be adjusted from time to time to take into account any
      additional shares received by Borrower as a result of any stock split,
      dividend, subdivision or combination effected by Borrower after February
      26, 2003)"

            c.    Annex A (Definitions) is hereby amended by:

                  i.    Deleting clause (a)(i) of the definition of "Fixed
            Charge Coverage Ratio" in its entirety and substituting the
            following in lieu thereof:

                  "Capital Expenditures (other than (y) Capital Expenditures
                  financed pursuant to clause (i) or (ii) of Section 6.3 and (z)
                  solely for the purpose of calculating the Fixed Charge
                  Coverage Ratio for the twelve (12) month periods ending on
                  each of the Fiscal Quarters ending September 30, 2002,
                  December 31, 2002, March 31, 2003 and June 30, 2003, the CEF
                  Lease Prepayment Amount),"

                  ii.   Deleting the definition of "GSOT" in its entirety and
            substituting the following in lieu thereof:

                  "`GSOT' shall mean the Callaway Golf Company Grantor Stock
                  Trust established pursuant to the Trust Agreement dated as of
                  July 14, 1995 between the Borrower and Bank of the West, as
                  successor to Sanwa Bank California."

                  iii.  Adding the following definitions in their proper
            alphabetic order:

                  "`CEF Lease Prepayment Amount' shall mean the August 2002
                  payment by the Borrower to General Electric Capital
                  Corporation, for itself and for certain participants, of an
                  aggregate amount of $50,798,049.00 in connection with the CEF
                  Lease Facility.'"

                  "`Collection Account' shall mean that certain segregated
                  deposit account held in the name of Callaway Golf Sales
                  Company and maintained with Wells Fargo Bank, N.A., as a
                  Relationship Bank,

                                       5
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                  and designated as the "Collection Account," account number
                  4159-274265, ABA No. 121000248, or such other collection
                  account established in accordance with the requirements set
                  forth in Annex C."

                  "Permitted Merger" shall mean the merger of Special Purpose
                  Corporation with and into Callaway Golf Sales Company, a
                  California corporation, with Callaway Golf Sales Company as
                  the surviving corporation, which merger shall be effective as
                  soon as commercially practicable after the termination of the
                  Receivables Facility and the documentation for which shall be
                  executed and delivered immediately upon the termination of the
                  Receivables Facility.

                  "`Relationship Bank' shall have the meaning assigned to it in
                  paragraph (a) of Annex C."

            d.    Disclosure Schedule 3.19 is hereby amended by deleting the
      text thereof in its entirety and substituting Schedule I attached hereto,
      in lieu thereof.

            e.    Section 5.1 is hereby amended by adding the following proviso
      at the end thereof:

                  "; provided, further, that the Permitted Merger shall not be
                  deemed a violation of this covenant"

            f.    Section 6.1(a) is hereby amended by adding the following
      proviso at the end thereof:

                  "; provided, that the Permitted Merger shall not be deemed a
                  violation of this covenant"

            g.    Section 6.4(a) is hereby amended by adding the following
      proviso at the end of the first sentence thereof:

                  "; provided, that the Permitted Merger shall not be deemed a
                  violation of this covenant"

            h.    Section 6.5 is hereby amended by adding the following proviso
      at the end of the first sentence thereof:

                  "; provided, that the Permitted Merger shall not be deemed a
                  violation of this covenant"

                                       6
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
      3.    Limited Waivers. Upon the Effective Date, and as limited herein, the
Requisite Lenders hereby waive the following provisions of the Credit Agreement
solely with respect to the matters expressly described below:

            a.    Section 1.8, solely with respect to the Cash Management Events
      of Default.

            b.    Section 6.2, solely with respect to the Investment Events of
      Default;

            c.    Section 6.10, solely with respect to the Financial Covenant
      Event of Default;

            d.    Section 6.14, solely with respect to the Restricted Payment
      Events of Default; and

            e.    Section 8.1(m), solely with respect to the Cross-Event of
      Default.

            The Limited Waivers shall be limited to the Cash Management Events
of Default, the Reporting Events of Default, the Investment Events of Default,
the Financial Covenant Event of Default, the Restricted Payment Events of
Default and the Cross-Event of Default and do not apply to any past, present or
future Defaults or Events of Default caused by any other violation of Sections 5
or 6, or any other provisions, of the Credit Agreement or any of the other Loan
Documents.

      4.    Representations and Warranties. The Credit Parties hereby jointly
and severally represent and warrant to the Agent and the Requisite Lenders that,
as of the Effective Date and after giving effect to this Fifth Amendment:

            a.    All of the representations and warranties of the Credit
      Parties contained in this Fifth Amendment, the Credit Agreement and the
      other Loan Documents are true and correct in all material respects on and
      as of the Effective Date, as if then made (other than representations and
      warranties which expressly speak as of a different date, which shall be
      true and correct in all material respects as of that date); and

            b.    No Default or Event of Default has occurred and is continuing
      or will result after giving effect to this Fifth Amendment.

      5.    Effective Date. This Fifth Amendment shall become effective as of
the date first written above (the "Effective Date") upon the satisfaction of
each of the following conditions:

            a.    the Agent shall have received each of the following documents,
      in each case in form and substance satisfactory to the Agent:

                  i.    the Compliance Certificates for each of the Third
            Quarter 2002 and the Fourth Quarter 2002;

                  ii.   counterparts hereof executed by each of the Credit
            Parties, the Agent and the Requisite Lenders;

                                       7
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                  iii.  duly executed documentation reasonably satisfactory to
            the Agent evidencing the termination of the Receivables Facility;

                  iv.   a duly executed tri-party blocked account agreement, or
            an amendment to an existing blocked account agreement, for each bank
            account that will be held by Callaway Golf Sales Company on or after
            the Effective Date, each of which blocked account agreement or
            amendment, as the case may be, shall be between the Agent, for the
            benefit of itself and the Lenders, the Borrower and its
            Subsidiaries, as applicable, and the applicable Relationship Bank
            and in form and substance satisfactory to the Agent;

                  v.    a certificate of the Secretary or Assistant Secretary of
            each of the Credit Parties dated the Effective Date certifying (A)
            that the bylaws of such Credit Party have not been amended or
            otherwise modified since the date of the most recent certification
            thereof by the Secretary or Assistant Secretary of such Credit Party
            delivered to the Agent and remain in full force and effect as of the
            Effective Date, (B) that the charter of such Credit Party has not
            been amended or otherwise modified since the date of the most recent
            certification thereof by the Secretary of State of such Credit
            Party's jurisdiction of incorporation delivered to the Agent and
            remain in full force and effect as of the Effective Date and (C)
            that the execution, delivery and performance of this Fifth Amendment
            have been duly authorized by all necessary or proper corporate and
            shareholder action; and

                  vi.   such additional documentation as the Agent may
            reasonably request;

            b.    all bank accounts held by Special Purpose Corporation shall
      have been transferred to Callaway Golf Sales Company or closed;

            c.    the Agent shall have received, on behalf of the Requisite
      Lenders that deliver their executed counterparts of this Fifth Amendment
      by noon Pacific Standard Time on February 26, 2003 (the "Consenting
      Lenders"), the Borrower's payment of a waiver fee in an amount equal to
      (i) 0.125% of the aggregate amount of the Commitments of the Consenting
      Lenders minus (ii) One Hundred Percent (100%) of the aggregate amount
      payable by the Borrower to the Agent on account of fees and expenses
      incurred by the Agent in connection with the preparation and execution of
      this Fifth Amendment and that certain letter delivered to the Borrower by
      the Agent on February 7, 2003;

            d.    No law, regulation, order, judgment or decree of any
      Governmental Authority shall, and the Agent shall not have received any
      notice that litigation is pending or threatened which is likely to,
      enjoin, prohibit or restrain the consummation of the transactions
      contemplated by this Fifth Amendment, except for such laws, regulations,
      orders or decrees, or pending or threatened litigation, that in the
      aggregate could not reasonably be expected to have a Material Adverse
      Effect;

                                       8
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
            e.    All corporate and other proceedings, and all documents,
      instruments and other legal matters in connection with the transactions
      contemplated by this Fifth Amendment shall be satisfactory in all respects
      in form and substance to the Agent; and

            f.    No Default or Event of Default shall have occurred and be
      continuing on the Effective Date or will result after giving effect to
      this Fifth Amendment.

      6.    Covenant Regarding Non-blocked Accounts. Within thirty (30) days of
the date hereof, Borrower shall have caused each of the Non-blocked Accounts to
either be (i) subject to an executed tri-party blocked account agreement between
the Agent, for the benefit of itself and the Lenders, the Borrower and the
applicable Relationship Bank and in form and substance satisfactory to the Agent
or (ii) closed, as evidenced by documentation reasonably satisfactory to the
Agent.

      7.    Reference to and Effect on the Loan Documents.

            a.    Upon the Effective Date, each reference in the Credit
      Agreement to "this Agreement", "hereunder", "hereof" or words of like
      import, and each reference in the other Loan Documents to the Credit
      Agreement, shall mean and be a reference to the Credit Agreement as
      amended and supplemented hereby.

            b.    Except to the extent specifically set forth herein, the
      respective provisions of the Credit Agreement and the other Loan Documents
      shall not be amended, modified, waived, impaired or otherwise affected
      hereby, and such documents and the Obligations under each of them are
      hereby confirmed as being in full force and effect.

            c.    This Fifth Amendment shall be limited solely to the matters
      expressly set forth herein and shall not (i) constitute an amendment or
      waiver of any other term or condition of the Credit Agreement or any other
      Loan Document, (ii) prejudice any right or rights which the Agent or any
      Lender may now have or may have in the future under or in connection with
      the Credit Agreement or any other Loan Document, (iii) require the Agent
      or any Lender to agree to a similar transaction on a future occasion or
      (iv) create any right herein to another Person or other beneficiary or
      otherwise, except to the extent specifically provided herein.

      8.    Miscellaneous. This Fifth Amendment is a Loan Document. The Section
titles in this Fifth Amendment are for convenience of reference only, shall be
without substantive meaning or content of any kind whatsoever and are not a part
of the agreement between the parties hereto.

      9.    Fees and Expenses. The Borrower acknowledges that all costs, fees
and expenses incurred by the Agent and its counsel with respect to this Fifth
Amendment and the documents and transactions contemplated hereby shall be the
responsibility of, and shall be paid by, the Borrower.

      10.   Counterparts. This Fifth Amendment may be executed in any number of
original or facsimile counterparts, each of which will be deemed an original,
and by the different parties

                                       9
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
hereto in separate counterparts, all of which shall together constitute one and
the same instrument.

      11.   GOVERNING LAW. THIS FIFTH AMENDMENT, AND ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE HEREOF, SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

      12.   No Strict Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Fifth Amendment. In the event an
ambiguity or question of intent or interpretation arises, this Fifth Amendment
shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Fifth Amendment.

                                       10
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
            IN WITNESS WHEREOF, the Credit Parties, the Agent and the Requisite
Lenders have caused this Fifth Amendment to be executed by their respective
officers thereunto duly authorized as of the date first above written.

                              CALLAWAY GOLF COMPANY,
                              as the Borrower

                              By:
                                    -------------------------
                                    Name:
                                    Title:

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              CALLAWAY GOLF SALES COMPANY,
                              as a Credit Party

                              By:
                                    -------------------------
                                    Name:
                                    Title:

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              GENERAL ELECTRIC CAPITAL CORPORATION,
                              as the Agent and a Lender

                              By:   /s/ Iain Douglas
                                    -------------------------
                                    Name:  Iain Douglas
                                    Title: Senior Vice President
                                    Pro Rata Share: 20.83%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              BANK ONE, NA (Main Office Chicago), as successor
                              to American National Bank and Trust Company of
                              Chicago, as a Lender

                              By:
                                    -------------------------
                                    Name:
                                    Title:
                                    Pro Rata Share: 17.71%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              BANK OF AMERICA, NATIONAL ASSOCIATION,
                              as a Lender

                              By:
                                    -------------------------
                                    Name:
                                    Title:
                                    Pro Rata Share: 14.17%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              CONGRESS FINANCIAL CORPORATION (WESTERN),
                              as a Lender

                              By:
                                    -------------------------
                                    Name:
                                    Title:
                                    Pro Rata Share: 14.17%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              KEY CORPORATE CAPITAL INC.,
                              as a Lender

                              By:
                                    -------------------------
                                    Name:
                                    Title:
                                    Pro Rata Share: 14.17%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              NATIONAL CITY COMMERCIAL FINANCE, INC.,
                              as a Lender

                              By:
                                    -------------------------
                                    Name:
                                    Title:
                                    Pro Rata Share: 8.33%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                              ROYAL BANK OF SCOTLAND,
                              as a Lender

                              By:
                                    -------------------------
                                    Name:
                                    Title:
                                    Pro Rata Share: 10.62%

                                 Signature Page
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT
<PAGE>
                                   SCHEDULE I

                                       TO

   FIFTH AMENDMENT AND LIMITED WAIVER TO AMENDED AND RESTATED CREDIT AGREEMENT

                            Disclosure Schedule 3.19

                                 (See attached.)

                                   Schedule I
                                                              FIFTH AMENDMENT TO
                                           AMENDED AND RESTATED CREDIT AGREEMENT

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