Document:

EXHIBIT 10.2
                                                                    ------------

                           SECOND GLOBAL AMENDMENT AND
                  REAFFIRMATION OF SUBORDINATED DEBT DOCUMENTS

         THIS SECOND GLOBAL AMENDMENT AND REAFFIRMATION OF SUBORDINATED DEBT
DOCUMENTS (this "Global Amendment") is made as of September 26, 2007, by and
among RONHOW, LLC, a Georgia limited liability company, (the "Lender"), HAROLD'S
STORES, INC., an Oklahoma corporation (the "Parent"), HAROLD'S FINANCIAL
CORPORATION, an Oklahoma corporation, HAROLD'S DIRECT, INC., an Oklahoma
corporation, HAROLD'S STORES OF TEXAS, L.P., a Texas limited partnership,
HAROLD'S OF JACKSON, INC., a Mississippi corporation, THE CORNER PROPERTIES,
INC., an Oklahoma corporation, HAROLD'S DBO, INC., a Texas corporation, HAROLD'S
LIMITED PARTNERS, INC., an Oklahoma corporation, and HSTX, INC., a Texas
corporation (each, individually, a "Guarantor" and collectively the
"Guarantors").

                                    RECITALS:

         WHEREAS, Lender and Parent have entered into that certain Subordinated
Loan Agreement, dated as of August 31, 2006 and amended as of April 26, 2007
("Subordinated Loan Agreement"), and Guarantors have guaranteed the obligations
of Parent thereunder in favor of Lender pursuant to that certain Subordinated
Guaranty, dated as of August 31, 2006 and amended as of April 26, 2007
("Subordinated Guaranty"). The Subordinated Loan Agreement and the Subordinated
Guaranty are secured by the Subordinated Security Agreement, dated as of August
31, 2006 and amended as of April 26, 2007, by Parent and Guarantors in favor of
Lender ("Subordinated Security Agreement"); and

         WHEREAS, on the date hereof, Wells Fargo Retain Finance II, LLC or its
affiliate (collectively, "Wells") has established a general ledger account (the
"Deposit Account") in the name of the Lender to secure letters of credit (the
"LCs") issued by Wells for the account of the Parent; and

         WHEREAS, on the date hereof, Lender has delivered to Wells by wire
transfer of immediately available funds the sum of $600,000 (the "Deposit") for
deposit into the Deposit Account;

         WHEREAS, concurrent with the execution and delivery of this Global
Amendment, the Lender will deliver to Wells a Limited Recourse Guaranty and
Security Agreement (the "Lender Guaranty"); and

         WHEREAS, the Lender Guaranty shall authorize Wells to set off amounts
held in the Deposit Account against any obligations owed by the Parent to Wells
under the LCs; and

         WHEREAS, the Lender, the Parent and the Guarantors desire that any
amounts of the Deposit set off pursuant to the terms of the Lender Guaranty
shall be deemed advances to the Parent under the Tranche B Revolving Loan
(defined below) under the Subordinated Loan Agreement, in each case until such
time as Wells or the Parent may restore to the Deposit Account such amounts set
off; and

<PAGE>

         WHEREAS, the Lender, the Parent and the Guarantors desire to (i)
increase the amount available to be borrowed by the Parent under the Tranche B
Revolving Loan under the Subordinated Loan Agreement to (ii) allow portions of
the Deposit Account set off by Wells to be deemed advances to the Parent under
the Tranche B Revolving Loan; (iii) allow a fee payable by the Parent to the
Lender in consideration of its establishment of the Deposit Account and making
of the Deposit to be deemed accrued interest under the Tranche B Revolving Loan
and payable as provided in the Second Amended and Restated Subordinated Secured
Promissory Note dated on the date of this Agreement and made by the Parent in
favor of the Lender in the face principal amount of $15,000,000.00 (the "Note");
and (iv) allow the Lender to make additional advances to the Parent from time to
time under the Tranche B Revolving Loan; and

         WHEREAS, the Lender, the Parent and the Guarantors desire to allow the
Parent to re-borrow at any time, and from time to time, principal amounts under
the Subordinated Loan Agreement that have been repaid pursuant to either the
conversion of indebtedness under the Tranche A Term Loan into shares of Series
2007-A Senior Preferred Stock of the Parent, or the conversion of indebtedness
under the Tranche B Revolving Loan into shares of 2007-B Senior Preferred Stock
of the Parent, in each case issued to the Lender in exchange for the forgiveness
of such indebtedness; and

         WHEREAS, the Lender, the Parent and the Guarantors desire to amend
certain provisions of the Subordinated Loan Agreement, Subordinated Guaranty and
the Subordinated Security Agreement to facilitate the foregoing.

         NOW, THEREFORE, in consideration of the foregoing and the agreements
set forth in this Global Amendment, Parent, Guarantors, and Lender hereby agree
as follows:

         SECTION 1. DEFINITIONS. Capitalized terms used herein and not otherwise
         defined herein shall have the meanings ascribed to them in the
         Subordinated Loan Agreement.

         SECTION 2. GLOBAL AMENDMENT. All references to any written agreement,
         document or note described or defined in the Subordinated Loan
         Agreement, Subordinated Guaranty or Subordinated Security Agreement
         shall be deemed to refer to such written agreement, document or note as
         the same may have been or may be amended, supplemented, modified,
         extended or restated from time to time.

         SECTION 3. AMENDMENTS TO SUBORDINATED LOAN AGREEMENT.

                  A. The first WHEREAS clause of the RECITALS of the
Subordinated Loan Agreement is hereby amended by amending and restating such
WHEREAS clause in its entirety as follows:

         WHEREAS, Borrower has requested that Lender make available to Borrower
a loan in the aggregate principal amount of up to Fifteen Million Dollars
($15,000,000) (the "Loan"), on the terms and conditions hereinafter set forth,
and for the purpose(s) hereinafter set forth; and

                  B. The second sentence of Section 1.1 of the Subordinated Loan
Agreement is hereby amended by amending and restating such sentence in its
entirety as follows:

                                        2
<PAGE>

         The Loan shall be evidenced by a Second Amended and Restated
Subordinated Secured Promissory Note in the face principal amount of Fifteen
Million Dollars ($15,000,000), dated as of September 26, 2007, executed by
Borrower in favor of Lender (the "Note").

                  C. Section 1.2 of the Subordinated Loan Agreement is hereby
amended by amending and restating such Section in its entirety as follows:

         1.2 Advances under the Loan; Payment of Interest.

         (a) Commitments. Borrower has requested, and the Lender agrees, on the
terms and conditions set forth in this Agreement, to extend credit to the
Borrower from time to time prior to May 31, 2010 (the "Maturity Date") by making
loans to the Borrower (i) on a non-revolving basis in an amount not to exceed
the aggregate principal amount of Five Million Dollars ($5,000,000) (the
"Tranche A Term Loan"), and (ii) on a revolving basis from time to time (the
"Tranche B Revolving Loan"), provided, however, that at no time shall the
aggregate outstanding amount of such loans exceed Ten Million Dollars
($10,000,000) (the "Revolving Commitment"). Upon the issuance to the Lender from
time to time of shares of Borrower's Series 2007-A Senior Preferred in exchange
for forgiveness of principal under the Tranche A Term Loan, (i) the maximum
aggregate principal amount of the Tranche A Term Loan will be reduced, and (ii)
the Revolving Commitment shall be increased, in each case on a dollar-for-dollar
basis by the amount of the principal so forgiven under the Tranche A Term Loan.
Subject to the terms and conditions of this Agreement, the Borrower may borrow,
repay, and re-borrow from time to time hereunder the amount of the Revolving
Commitment under this Section 1.2(a) to the extent that such repayment occurs
only through the issuance to the Lender of shares of Borrower's Series 2007-B
Senior Preferred in exchange for forgiveness of principal and accrued and unpaid
interest under the Tranche B Revolving Loan.

         (b) Advances. Lender has made (i) prior advances under the Tranche A
Term Loan in the aggregate amount of $7,000,000, of which $2,000,000 has been
repaid by the Borrower pursuant to a conversion of that amount of indebtedness
to Series 2007-A Senior Preferred of the Borrower, and (ii) prior advances under
the Tranche B Revolving Loan of $5,000,000. All amounts contained in that
certain deposit account established by Wells Fargo Retain Finance II, LLC or its
affiliate ("Wells") for the account of Lender (the "Deposit Account") that Wells
may at any time, and from time to time, set off against any obligations owed by
Lender to Wells pursuant to that certain Limited Recourse Guaranty and Security
Agreement by and between Lender and Wells dated September 26, 2007, shall be
deemed advances by Lender to Borrower under the Tranche B Revolving Loan, in
each case from the time of such set-off until such time as such amounts set off
are restored and credited to the Deposit Account. Except as specified in the
preceding sentence, Lender shall not be obligated to make any further advance to
Borrower under the Loan. Any such further advance shall be made following
Borrower's written request for such advance, at Lender's sole discretion and
subject to such conditions as Lender shall specify.

         (c) Interest.

                                        3
<PAGE>

                  (i) Interest on the outstanding principal balance of the
         Tranche A Term Loan shall accrue at the rate of thirteen and one-half
         percent (13.5%) per annum (computed on the basis of a 360-day year
         consisting of twelve 30 day months). Interest on the outstanding
         principal balance of the Tranche B Revolving Loan shall accrue at the
         rate of eighteen percent (18%) per annum (computed on the basis of a
         360-day year consisting of twelve 30 day months).

                  (ii) Interest on the outstanding principal balance of the Loan
         shall be payable, in arrears, on the first day of each month or, if any
         such date shall not be a business day, on the next succeeding business
         day to occur after such date (each date on which interest shall be so
         payable, an "Interest Payment Date"), provided that, (A) on each
         Interest Payment Date through and including the first Interest Payment
         Date on which the aggregate amount of interest accruing from March 1,
         2007, through such Interest Payment Date under the Tranche A Term Loan
         and the Tranche B Revolving Loan equals or exceeds $1,000,000 (the
         "Final Mandatory Compounding Date"), the accrued interest under the
         Tranche A Term Loan payable on such date shall be added to the
         principal balance thereof and the accrued interest under the Tranche B
         Revolving Loan payable on such date shall be added to the Tranche B
         Revolving Loan, in each case in lieu of cash payment of such accrued
         interest by the Borrower; and (B) all accrued and unpaid interest shall
         be due and payable on the earlier of the Maturity Date and the date on
         which the Lender demands repayment pursuant to the terms of this
         Agreement.

                  (iii) On each Interest Payment Date occurring after the Final
         Mandatory Compounding Date, if any interest accrued under the Loan is
         not actually paid in cash to the Lender, at the Lender's option and in
         the Lender's sole discretion, the outstanding principal balance of the
         Loan shall be increased by an amount equal to the difference between
         (i) interest accruing on the principal balance of such tranche during
         the period from and including the previous Interest Payment Date to,
         but not including, such Interest Payment Date and (ii) interest
         actually paid in cash on the principal balance of such tranche on such
         Interest Payment Date, and such amount shall thereafter earn interest
         as principal. Any such increase to the principal amount of the Loan
         shall be deemed a payment of interest then due under the Note, and no
         Event of Default (as defined below) shall occur under this Agreement as
         a result thereof.

         (d) Deposit Account Fee. Prior to the Maturity Date and subject to the
terms and conditions set forth in this Agreement, the Borrower shall pay to the
Lender a fee (the "Deposit Account Fee") in consideration of Lender's
establishment of the Deposit Account and making of the Deposit, in an amount
determined in accordance with the following provisions:

                  (i) In respect of all amounts of the Deposit that continue to
         be held in the Deposit Account from time to time and against which
         Wells does not exercise its right of set-off under the Lender Guaranty,
         or which are set-off by Wells under the Lender Guaranty but are
         restored through payment or credit to the principal balance of the
         Deposit Account ("Deposited Collateral"), the Borrower shall pay to the
         Lender an amount equal to the excess of (i) the amount of interest that
         would accrue on such amounts of Deposited Collateral if such amounts
         were outstanding principal under the Tranche B Term Loan over (ii) the
         amount of interest paid by Wells to the Lender in

                                        4
<PAGE>

         respect of the Deposit Account, in each case during the period such
         Deposited Collateral is actually held on deposit in the Deposit
         Account; and

                  (ii) In respect of all amounts of the Deposit against which
         Wells exercises its right of set-off under the Lender Guaranty and
         which are not restored to the principal balance of the Deposit Account,
         the Borrower shall not pay a fee to the Lender.

         (e) The Deposit Account Fee shall be payable, in arrears, on the first
day of each month or, if any such date shall not be a business day, on the next
succeeding business day to occur after such date; provided, however, that in
lieu of any payment in cash of the Deposit Account Fee, the amount of the
accrued Deposit Account Fee shall be deemed for all purposes under this
Agreement to be accrued but unpaid interest under the Tranche B Revolving Loan
that shall be subject to addition to principal as provided in Sections
1.2(c)(ii) and (iii) of this Agreement.

                  D. Section 4.2 of the Subordinated Loan Agreement is hereby
amended by amending and restating such Section in its entirety as follows:

         4.2 Advances under the Tranche B Revolving Loan. The obligation of
Lender to fund the initial advance of $2,000,000 under the Tranche B Revolving
Loan was subject to the acceptance and acknowledgment by execution of Borrower
and delivery to Lender, on or prior to April 4, 2007, of that certain letter
agreement between Lender and Borrower, dated as of March 30, 2007, regarding the
$2,000,000 advance under this Agreement and the Note, a copy of which is
attached hereto as Exhibit B. The obligation of Lender to fund all additional
advances under the Tranche B Revolving Loan:

         (i)      shall be subject to the fulfillment of each of the following
                  conditions (any or all of which may be waived in writing by
                  the Lender in its sole discretion):

                  (a)      Borrower shall have and shall have caused Guarantors
                           to have performed and complied in all material
                           respects with all of the covenants, agreements,
                           obligations and conditions required by this Agreement
                           and the other Loan Documents;

                  (b)      All representations and warranties of Borrower and
                           Guarantors set forth in this Agreement and the other
                           Loan Documents shall be true and correct in all
                           material respects on and as of the date of such
                           additional advance, as though made on and as of such
                           date (except to the extent that such representations
                           and warranties relate solely to an earlier date);

                  (c)      There does not exist any condition or event that
                           constitutes a Default or an Event of Default, nor
                           will any thereof occur after giving effect to such
                           additional advance;

                                        5
<PAGE>

                  (d)      Borrower shall have delivered to Lender an amended
                           and restated subordinated secured promissory note
                           executed by Borrower, in form and substance
                           satisfactory to Lender;

                  (e)      Borrower shall have delivered to Lender a global
                           amendment and reaffirmation of subordinated debt
                           documents, (a "Global Amendment") executed by
                           Borrower and Guarantors, in form and substance
                           satisfactory to Lender;

                  (f)      Borrower shall have delivered to Lender an amendment
                           to the Subordination and Intercreditor Agreement,
                           executed by Borrower, Guarantors, and Wells, as the
                           senior creditor, in form and substance satisfactory
                           to Lender; and

         (ii)     may, at the Lender's option, be subject to the fulfillment of
                  any of the following conditions:

                  (a)      Borrower shall have delivered to Lender a certificate
                           of the secretary or assistant secretary of Borrower
                           certifying that: the copy of the corporate charter
                           and other publicly filed organizational documents of
                           Borrower, certified by the Secretary of State or
                           other appropriate public official in the jurisdiction
                           in which Borrower is formed, and a copy of the bylaws
                           of Borrower delivered to Lender in connection
                           therewith, are true, correct and complete copies and,
                           such corporate charters, organizational documents,
                           and bylaws, have not been further amended, modified
                           or rescinded and are in full force and effect as of
                           the date of the Global Amendment;

                  (b)      Borrower shall have caused each Guarantor to deliver
                           to Lender a certificate of the secretary or assistant
                           secretary of such Guarantor certifying that: (x) the
                           copy of the corporate charter and other publicly
                           filed organizational documents of such Guarantor,
                           certified by the Secretary of State or other
                           appropriate public official in the jurisdiction in
                           which such Guarantor is formed and the copy of the
                           bylaws or limited partnership agreement, as
                           applicable, of such Guarantor delivered to Lender in
                           connection therewith, are true, correct and complete
                           copies and such corporate charters, organizational
                           documents, bylaws and limited partnership agreement,
                           as applicable, have not been further amended,
                           modified or rescinded and are in full force and
                           effect as of the date of the Global Amendment; and
                           (y) such Guarantor is in good standing in its
                           jurisdiction of formation as of the date of the
                           Global Amendment;

                  (c)      Borrower shall have delivered to Lender certified
                           copies of all corporate action taken by Borrower and
                           each Guarantor, including resolutions of its Board of
                           Directors, authorizing the execution, delivery and
                           performance of the documents described in this
                           Section 4.2;

                                        6
<PAGE>

                  (d)      Borrower shall have delivered to Lender a certificate
                           as to the legal existence and good standing of
                           Borrower, issued by the Secretary of State or other
                           appropriate public official in the jurisdiction in
                           which Borrower, no more than thirty days prior to the
                           effective date of the Global Amendment; or

                  (e)      Borrower shall have delivered to Lender all other
                           documents and legal matters in connection with the
                           transactions contemplated by this Agreement or the
                           Global Amendment which shall be in form an substance
                           satisfactory to Lender.

         SECTION 4. REFERENCES TO CERTAIN SUBORDINATED DEBT DOCUMENTS. All
         references to each of the Subordinated Loan Agreement, Subordinated
         Guaranty and Subordinated Security Agreement in any of the Loan
         Documents shall be deemed a reference to each of the Subordinated Loan
         Agreement, Subordinated Guaranty and Subordinated Security Agreement as
         amended by this Global Amendment. Except as expressly provided in this
         Global Amendment, the execution and delivery of this Global Amendment
         does not and will not amend, modify or supplement any provision of, or
         constitute a consent to or a waiver of any noncompliance with the
         provisions of, the Subordinated Loan Agreement, Subordinated Guaranty
         and Subordinated Security Agreement or any of the other Loan Documents
         executed in connection therewith. To the extent not inconsistent
         herewith, the Subordinated Loan Agreement, Subordinated Guaranty and
         Subordinated Security Agreement and each of the other Loan Documents
         executed by Parent, and Guarantors in connection therewith shall remain
         in full force and effect and are hereby ratified and confirmed by the
         parties thereto.

         SECTION 5. EFFECTIVE DATE. This Global Amendment shall become effective
         as of its date and shall bind all parties only upon (i) the execution
         and delivery by the Parent and Guarantors to Lender of this Global
         Amendment, (ii) the execution and deliver by the Parent, Guarantors,
         and Wells to Lender of that certain Second Amendment to Subordination
         and Intercreditor Agreement, dated as of the date hereof, and (iii)
         such other documents or agreements executed and delivered by Parent and
         Guarantors or any other party as Lender shall reasonably request; and
         shall be conditioned upon the correctness of all representations and
         warranties made by Parent and Guarantors.

         SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE PARENT AND GUARANTORS.
         Each of the Parent and Guarantors hereby represents and warrants to
         Lender as follows:

                  A. Such party has the right and power, and has taken all
necessary action to authorize it, to execute, deliver and perform this Global
Amendment in accordance with its terms. This Global Amendment has been duly
executed and delivered by such party and is a legal, valid and binding
obligation of it, enforceable against it in accordance with its terms.

                                        7
<PAGE>

                  B. The execution, delivery and performance of this Global
Amendment in accordance with its terms do not and will not, by the passage of
time, the giving of notice or otherwise,

                           (i) require any governmental approval or violate any
applicable law relating to such party;

                           (ii) conflict with, result in a breach of or
constitute a default under the organizational documents of such party, any
material provision of any indenture, agreement or other instrument to which it
is a party or by which it or any of its properties may be bound or any
governmental approval relating to it; or

                           (iii) result in or require the creation or imposition
of any lien (except as permitted by the Loan Documents) upon or with respect to
any property now owned or hereafter acquired by such party.

                  C. That, after giving affect to the amendments set forth in
this Global Amendment, the representations and warranties of such party set
forth in the Loan Documents and in any other document, instrument or agreement
executed or delivered in connection therewith are true and correct as of the
date hereof as if made on the date hereof.

                  D. No Event of Default under the Loan Documents, other than as
specifically waived herein, has occurred and is continuing as of this date.

         SECTION 7. NO NOVATION. It is the intention of the parties hereto that
         this Global Amendment shall not constitute a novation of the
         Subordinated Loan Agreement, Subordinated Guaranty or Subordinated
         Security Agreement and shall in no way adversely affect or impair the
         validity of the Loan Documents, it being the intention of the parties
         hereto merely to amend the Subordinated Loan Agreement, Subordinated
         Guaranty or Subordinated Security Agreement as expressly set forth
         herein.

         SECTION 8. COUNTERPARTS. This Global Amendment may be executed in one
         or more counterparts, each of which shall be deemed an original, but
         all of which together shall constitute one and the same instrument.

         SECTION 9. GOVERNING LAW. THIS GLOBAL AMENDMENT SHALL BE CONSTRUED IN
         ACCORDANCE WITH AND BE GOVERNED BY THE LAWS (WITHOUT GIVING EFFECT TO
         THE CONFLICT OF LAW PRINCIPLES THEREOF) OF THE STATE OF GEORGIA.

         SECTION 10. THIS GLOBAL AMENDMENT. This Global Amendment is executed
         pursuant to the Subordinated Loan Agreement, Subordinated Guaranty and
         Subordinated Security Agreement and shall be construed, administered
         and applied in accordance with all of the terms and provisions of the
         same.

         SECTION 11. REAFFIRMATION. Guarantors hereby

                                        8
<PAGE>

                           (i) acknowledge that, as of the date hereof, the face
principal amount of the Subordinated Note has been increased to $15,000,000, the
interest rate on the Tranche B Revolving Loan is 18% per annum, Lender has
agreed to defer payment of approximately $1,000,000 of interest on the Loan and
permit such accrued but unpaid interest to be added to the principal balance
outstanding under the Note, and may, in its sole discretion, defer and/or permit
the addition to principal of certain accrued interest under the Note in excess
of $1,000,000, as provided in Section 3(B) of this Global Amendment;

                           (ii) agree that each of the Subordinated Guaranty and
Subordinated Security Agreement remains in full force and effect and continues
to be the legal, valid and binding obligation of each of the Guarantors
enforceable against each of the Guarantors in accordance with its terms, except
as expressly modified by the relevant provisions of this Global Amendment; and

                           (iii) affirms that the Subordinated Guaranty
guarantees all of the present and future indebtedness owing by Parent to Lender
under or in connection with the Subordinated Loan Agreement and the other Loan
Documents, as modified by the Amendments, and the Subordinated Security
Agreement secures all of the payment and performance obligations of Parent and
Guarantors, whether now existing or hereafter arising, under the Subordinated
Loan Agreement, the Note or the Subordinated Guaranty, as modified by the
Amendments.

                            [SIGNATURE PAGES FOLLOW]

                                        9
<PAGE>

         IN WITNESS WHEREOF, the undersigned Lender has executed this Global
Amendment as of the date first above written.

                  LENDER:

                  RONHOW, LLC, a Georgia limited liability company

                  By: Ronus, Inc., a Georgia corporation,
                      Managing Member

                      By: /s/ Robert L. Anderson
                          ------------------------------
                          Robert L. Anderson, President

                                       10
<PAGE>

IN WITNESS WHEREOF, the undersigned Parent and Guarantors have executed this
Global Amendment as of the date first above written.

                           PARENT:
                           -------

                           HAROLD'S STORES, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           GUARANTORS:
                           -----------

                           HAROLD'S FINANCIAL CORPORATION

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           HAROLD'S DIRECT, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           HAROLD'S STORES OF TEXAS, L.P.

                           By: HSTX, Inc., General Partner

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           HAROLD'S OF JACKSON, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           THE CORNER PROPERTIES, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                                       11
<PAGE>

                           HAROLD'S DBO, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           HAROLD'S LIMITED PARTNERS, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                           HSTX, INC.

                           By: /s/ Ron Staffieri
                               --------------------------
                           Name: Ron Staffieri
                           Title: CEO

                                       12
<PAGE>

                                    Exhibit B

                                   [attached]

<PAGE>

                                   RonHow, LLC
                             3290 Northside Parkway
                                    Suite 250
                                Atlanta, GA 30302

                                 March 30, 2007

Harold's Stores, Inc.
765 Asp Avenue
Norman, OK  73069
Attn: Jodi Taylor, Chief Financial Officer

Dear Jodi:

         In conjunction with discussions among Harold's Stores, Inc. and its
majority investors regarding continued financial support for Harold's, the
parties have developed a short-term financing plan as outlined in the attached
summary term sheet.

         Given Harold's immediate need for cash, RonHow is willing to make an
additional $2 million advance under the existing Subordinated Loan Agreement and
related note, each dated as of August 31, 2006. As a condition to making this
advance, RonHow is requiring that Harold's agree to the following:

         1.   Subject to the approval of Harold's senior lender, Wells Fargo
              Retail Finance II, LLC, interest will accrue on this $2 million
              advance at a rate of 18.0% per annum. Upon such approval, the
              18.0% per annum rate will be applied retroactively to the date of
              the advance, in place of the 13.5% per annum rate otherwise
              applicable pursuant to the current terms of the subordinated note.

         2.   Harold's will use commercially reasonable efforts to obtain, as
              promptly as practicable, the approval of Wells Fargo for the 18.0%
              per annum interest rate on such advance.

         3.   Harold's will execute and deliver, and cause the guarantors of the
              subordinated loan to execute and deliver, any and all documents
              reasonably requested by RonHow to evidence the 18.0% per annum
              interest rate accruing on the advance and the continuing
              effectiveness of the guaranty and security provided by the
              guarantors with respect to all of the indebtedness outstanding
              under the subordinated debt facility, including this additional
              advance.

         4.   Harold's will use commercially reasonable efforts to obtain, as
              promptly as practicable, the consent and approval of Wells Fargo
              to all aspects of the proposed

<PAGE>

Harold's Stores, Inc.
March 30, 2007
Page 2

              short-term financing plan as described in the attached summary
              term sheet that require Wells Fargo's approval.

         If Harold's is in agreement with the above conditions to the $2 million
advance, please execute the enclosed copy of this letter in the place indicated
below and return it to me.

                                           Sincerely,

                                           /s/ Robert L. Anderson
                                           ------------------------------
                                           Robert L. Anderson
                                           President, Ronus, Inc.,
                                           Managing Member of RonHow, LLC

Accepted and agreed to on behalf of Harold's Stores, Inc.

By: /s/ Jodi L. Taylor
    ------------------------------
    Title: Chief Financial Officer
    Date: March 30, 2007EXHIBIT 10.3
                                                                    ------------

                                                               EXECUTION VERSION

                 AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT
                 ----------------------------------------------

         This AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT (this "Amendment")
is entered into as of September 26, 2007 (the "Effective Date"), by and among,
on the one hand, the lender identified on the signature page hereof (such
lender, together with its successors and assigns, is referred to hereinafter as
the "Lender"), WELLS FARGO RETAIL FINANCE II, LLC, as collateral agent and
administrative agent (the "Agent") for the Lender and any other holder of
Obligations (as defined in the Loan Agreement referred to below) and, on the
other hand, HAROLD'S STORES, INC., an Oklahoma corporation ("Parent"), HAROLD'S
FINANCIAL CORPORATION, an Oklahoma corporation ("Harold's Finance"), HAROLD'S
DIRECT, INC., an Oklahoma corporation ("Harold's Direct"), HAROLD'S STORES OF
TEXAS, L.P., a Texas limited partnership ("Harold's Texas"), and HAROLD'S OF
JACKSON, INC., a Mississippi corporation ("Harold's Mississippi", and
collectively with Harold's Texas, Harold's Direct, Harold's Finance and Parent,
the "Borrowers" and each, a "Borrower").

                                   BACKGROUND
                                   ----------

         FACT ONE: Lender, Agent, the Borrowers, and Harold's Stores of Georgia,
L.P., a Georgia limited partnership ("Harold's Georgia"), entered into that
certain Loan and Security Agreement, dated as of February 5, 2003, as amended by
each of the following amendments (as so amended, the "Loan Agreement"): (A) that
certain Amendment No. 1 to Loan and Security Agreement dated July 10, 2003, by
and among Lenders, Agent, Borrowers, and Harold's Georgia; (B) that certain
Amendment No. 2 to Loan and Security Agreement dated April 29, 2004, by and
among Lenders, Agent, the Borrowers and Harold's Georgia; (C) that certain
Amendment No. 3 to Loan and Security Agreement dated January 26, 2006, by and
among Lenders, Agent, the Borrowers and Harold's Georgia; (D) that certain
Amendment No. 4 to Loan and Security Agreement, dated as of June 1, 2006, by and
among Lenders, Agent and the Borrowers, (E) that certain Amendment No. 5 to Loan
and Security Agreement, dated as of August 31, 2006, by and among Lenders, Agent
and the Borrowers, and (F) that certain Amendment No. 6 to Loan and Security
Agreement, dated as of April 26, 2007, by and among Lenders, Agent and the
Borrowers.

         FACT TWO: Pursuant to the Loan Agreement, Lender has agreed to make
loans and other financial accommodations to, or for the benefit of, Borrowers on
the terms and otherwise subject to the conditions and limitations contained
therein.

         FACT THREE: Borrowers have requested that Lender and Agent agree to
modify certain terms and conditions set forth in the Loan Agreement in the
manner set forth in this Amendment, and Lender and Agent have agreed to modify
certain terms and conditions set forth in the Loan Agreement in the manner set
forth in this Amendment, subject in each instance to the limitations,
qualifications and conditions set forth in this Amendment.

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 1
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<PAGE>
                                                               EXECUTION VERSION

         NOW, THEREFORE, Lender, Agent and the Borrowers hereby modify,
supplement and amend the Loan Agreement as follows:

1.       INCORPORATION OF DEFINITIONS. Capitalized terms used in this Amendment,
to the extent not otherwise defined herein, have the meanings assigned to such
terms in the Loan Agreement, as amended hereby.

2.       AMENDMENTS AND ADDITIONS TO LOAN AGREEMENT.

         2.1 ADDITIONAL DEFINITIONS. As of the Effective Date, Section 1.1 of
the Loan Agreement is hereby amended by the addition of the following
definitions, in the appropriate alphabetical order:

                          "`Amendment No. 7' means Amendment No. 7 to Loan and
         Security Agreement, dated as of September 26, 2007, by and among the
         Lenders, Agent and Borrowers."

                          "`Guarantor's Deposit' means, as of any date of
         determination, that portion of the $600,000.00 cash deposit (together
         with undisbursed interest from time to time accrued in respect thereof)
         that:

                          (i) is made by the Letter of Credit Guarantor with
         Agent in connection with the Letter of Credit Guarantor's delivery of
         the Letter of Credit Guaranty and held by the Agent in an identifiable
         general ledger account owned by Agent and specifically documented as
         containing the cash deposit made by Letter of Credit guarantor as
         security for the Borrowers' performance of certain obligations
         specified in the Letter of Credit Guaranty in respect of L/Cs and L/C
         Undertakings, and as to which the balance thereof shall be payable to
         the Letter of Credit Guarantor upon the termination of the Letter of
         Credit Guaranty, subject to the terms thereof, and

                          (ii) has not been applied in respect of such
         reimbursement or other obligations,

         in each instance to the extent such cash deposit shall be available for
         the unconditional application by Agent in satisfaction of Borrowers'
         reimbursement obligations upon draw in respect of an L/C or L/C
         Undertaking, as applicable, pursuant to the Letter of Credit Guaranty."

                          "`Letter of Credit Guarantor' means RonHow, LLC, a
         Georgia limited liability company in its capacity as guarantor pursuant
         to the Letter of Credit Guaranty."

                          "`Letter of Credit Guaranty' means that certain
         Limited Recourse Guaranty and Security Agreement, dated as of September
         26, 2007, executed by the Letter of Credit Guarantor, for the benefit
         of the Lender Group, as the same may be amended, modified, restated or
         supplemented with the written approval of Agent."

                          "`Qualified Letter of Credit Inventory' means, as of
          any date of determination, Inventory and goods in the process of
          manufacture for the account of one

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 2
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<PAGE>
                                                               EXECUTION VERSION

         or more Borrowers that are contemplated to constitute Eligible
         Inventory upon completion and delivery at a location specified on
         Schedule E-1, that do not qualify as either Eligible Inventory or
         Eligible In-Transit Inventory under the terms of this Agreement, and
         that meet each of the following criteria, which criteria may be revised
         by Agent in its Permitted Discretion from time to time:

                           (a) such Inventory or goods in the process of
                  manufacture are the subject of an issued, outstanding and
                  undrawn Qualified Import Letter of Credit in an amount
                  sufficient to pay the full purchase price of such Inventory or
                  goods in the process of manufacture, and

                          (f) the applicable Qualified Import Letter of Credit
                  was issued within sixty (60) days from the applicable date of
                  determination."

                          "`Qualified Letter of Credit Inventory Sublimit'
         means, with respect to any date of determination, $2,500,000."

         2.2 REVISION TO EXISTING DEFINITIONS. As of the Effective Date, the
following definitions are hereby amended and restated to read in their entirety
as follows:

                          "`Eligible In-Transit Inventory" means Inventory of
          Borrowers (i) that does not qualify as Eligible Inventory solely
          because it is not at a location set forth on Schedule E-1 or at a
          location designated for a Warehouse Sale in accordance with this
          Agreement and (ii) that meets the following criteria, which criteria
          may be revised by Agent in its Permitted Discretion from time to time
          after the Closing Date:

                           (a) such Inventory currently is in transit (whether
                   by vessel, air, or land) either (i) from a location outside
                   of the continental United States to a location set forth on
                   Schedule E-1 or a location designated for a Warehouse Sale in
                   accordance with this Agreement that is the subject of a
                   Bailee Acknowledgment or a Collateral Access Agreement and
                   has been in-transit for a period of less than 30 calendar
                   days or (ii) between locations set forth on Schedule E-1 or
                   any such location and a location designated for a Warehouse
                   Sale in accordance with the provisions of this Agreement and
                   has been in-transit for a period of less than 7 calendar
                   days,
                           (b) title to such Inventory has passed to the
                   applicable Borrower,

                           (c) such Inventory is insured against types of loss,
                   damage, hazards, and risks, and in amounts, satisfactory to
                   Agent in its Permitted Discretion,

                           (d) such Inventory either

                                    (1) is the subject of a negotiable bill of
                          lading that (x) is consigned to Agent (either directly
                          or by means of endorsements), (y) was issued by the
                          carrier respecting the subject Inventory, and (z)
                          either is (I) in the possession of Agent or a customs
                          broker (in each case in a jurisdiction acceptable to
                          Agent in its Permitted Discretion), or (II) in-transit
                          by air-courier to Agent or a customs broker (in each
                          case, in a jurisdiction

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 3
----------------------------------------------
<PAGE>
                                                               EXECUTION VERSION

                          acceptable to Agent in its Permitted Discretion) and
                          for which Agent has received evidence satisfactory to
                          Agent in its sole discretion that such air-courier
                          delivery has been initiated, or

                                    (2) is the subject of a negotiable cargo
                          receipt and is not the subject of a bill of lading
                          (other than a negotiable bill of lading consigned to,
                          and in the possession of, a consolidator or Agent, or
                          their respective agents) and such negotiable cargo
                          receipt is (x) consigned to Agent (either directly or
                          by means of endorsements), (y) that was issued by a
                          consolidator respecting the subject Inventory, (z)
                          that either is (I) in the possession of Agent or a
                          customs broker (in each case in a jurisdiction
                          acceptable to Agent in its Permitted Discretion), or
                          (II) in-transit by air-courier to Agent or a customs
                          broker (in each case, in a jurisdiction acceptable to
                          Agent in its Permitted Discretion) and for which Agent
                          has received evidence satisfactory to Agent in its
                          sole discretion that such air-courier delivery has
                          been initiated,

                           (e) Administrative Borrower has provided a
                   certificate to Agent that certifies that, to the best
                   knowledge of Borrowers, such Inventory meets all of
                   Borrowers' representations and warranties contained in the
                   Loan Documents concerning Eligible Inventory, that Borrowers
                   know of no reason why such Inventory would not be accepted by
                   the applicable Borrower when it arrives in at a location
                   specified on Schedule E-1, and that the shipment as evidenced
                   by the documents conforms to the related order documents, and

                           (f) to the extent such Inventory previously shall
                   have been included in the category of Qualified Letter of
                   Credit Inventory, such Inventory shall have been removed from
                   such category and the applicable Qualified Letter of Credit
                   shall have been drawn in accordance with its terms and
                   Borrowers shall have discharged their reimbursement
                   obligations to Agent and Lenders in respect of such draw as
                   contemplated by this Agreement."

                          "`Loan Documents' means this Agreement, the Bank
         Product Agreements, the Cash Management Agreements, the Credit Card
         Agreements, all Control Agreements, the Disbursement Letter, the
         Guaranty, the Letters of Credit, the Letter of Credit Guaranty, any
         Mortgages, each Perfection Certificate, the Copyright Security
         Agreement, the Stock Pledge Agreement, the Trademark Security
         Agreement, the Intercompany Subordination Agreement, the Assignment of
         Deposit Accounts, any Bank Product Agreement, any certificates
         (including without limitation, the Borrowing Base Certificate and the
         Compliance Certificate) from time to time delivered by a Borrower
         pursuant to this Agreement or any other Loan Document, any note or
         notes executed by a Borrower in connection with this Agreement and
         payable to a member of the Lender Group, and any other agreement
         entered into, now or in the future, by any Borrower and the Lender
         Group in connection with this Agreement."

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 4
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<PAGE>
                                                               EXECUTION VERSION

                          "`Maximum Revolver Amount' means, as of any date, the
         lesser of (a) $30,000,000, and (b) the sum of $24,000,000 PLUS the
         outstanding principal amount of any Restricted Advances."

                          "`Qualified Import Letter of Credit' means a Letter of
         Credit that (a) is issued to facilitate the purchase by the applicable
         Borrower of Inventory, (b) is in form and substance acceptable to
         Agent, and (c) is issued to support an Underlying Letter of Credit that
         only is drawable by the beneficiary thereof by the presentation of,
         among other documents, either (i) a negotiable bill of lading that is
         consigned to Agent (either directly or by means of endorsements) and
         that was issued by the carrier respecting the subject Inventory, or
         (ii) a negotiable cargo receipt that is consigned to Agent (either
         directly or by means of endorsements) and that was issued by a
         consolidator respecting the subject Inventory; provided, however, that,
         in the latter case, no bill of lading shall have been issued by the
         carrier (other than a bill of lading consigned to the consolidator or
         to Agent)."

                          "`Subordinated Loan Documents" means each of the
         following: (a) that certain Subordinated Loan Agreement, August 31,
         2006, by and between Parent and Subordinated Lender, as amended and
         supplemented by (i) that certain Global Amendment and Reaffirmation of
         Subordinated Debt Documents, dated as of April 26, 2007, by and among
         Parent, certain Subsidiaries of Parent, as guarantors, and Subordinated
         Lender and (ii) that certain Second Global Amendment and Reaffirmation
         of Subordinated Debt Documents, dated of even date with Amendment No.
         7, by and among Parent, certain Subsidiaries of Parent, as guarantors,
         and Subordinated Lender; (b) that certain Second Amended and Restated
         Subordinated Secured Promissory Note, dated of even date with Amendment
         No. 7, executed by Parent and payable to the order of Subordinated
         Lender in the stated principal amount of up to $15,000,000; (c) that
         certain Subordinated Guaranty, dated as of August 31, 2006, executed by
         certain Subsidiaries of Parent for the benefit of Subordinated Lender
         and reaffirmed by the agreements referred to in clauses (a)(i) and (ii)
         of this definition; (d) that certain Subordinated Security Agreement,
         dated as of August 31, 2006, executed by Parent and certain of its
         Subsidiaries for the benefit of Subordinated Lender and reaffirmed by
         the agreements referred to in clauses (a)(i) and (ii) of this
         definition; and (e) all other instruments, documents, agreements,
         certificates from time to time delivered pursuant to, in connection
         with, or otherwise securing obligations under any of the foregoing."

         2.3 AMENDMENTS TO SECTION 2.1(A) THROUGH SECTION 2.1(G) AND ADDITIONS
OF NEW SECTIONS 2.1(H) AND (I). As of the Effective Date, Section 2.1(A) through
Section 2.1(G) of the Loan Agreement are hereby amended and restated in their
entirety to read as follows, and new Sections 2.1(H) and (I) of the Loan
Agreement are hereby added to read in their entirety as follows:

                           "(A) THE LESSER OF

                                    (I) $8,000,000.00, and

                                    (II) THE SUM OF

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 5
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<PAGE>
                                                               EXECUTION VERSION

                                            (x) the Credit Card Advance Rate
                                    times the amount of Eligible Credit Card
                                    Accounts, and

                                            (y) the Credit Card Advance Rate
                                    times the amount of Eligible Private Label
                                    Credit Card Accounts,

                           plus, either (B) or (C) below, as applicable,

                           (B) if the applicable date of determination is not
                  during a Seasonal Period, THE LESSER OF

                                    (I) 85% of the then extant Net Liquidation
                           Percentage times the value of Eligible Inventory, and

                                    (II) 85% of the Cost value of Eligible
                           Inventory, or

                           (C) if the applicable date of determination is during
                  a Seasonal Period, THE LESSER OF

                                    (I) 90% of the then extant Net Liquidation
                           Percentage times the value of Eligible Inventory, and

                                    (II) 85% of the Cost value of Eligible
                           Inventory,

                           plus, either (D) or (E) below, as applicable,

                           (D) if the applicable date of determination is not
                  during a Seasonal Period, THE LEAST OF

                                    (I) 85% of the then extant Net Liquidation
                           Percentage times the value of Eligible In-Transit
                           Inventory,

                                    (II) 85% of the Cost value of Eligible
                           In-Transit Inventory,

                                    (III) an amount equal to the then-applicable
                           In-Transit Inventory Sublimit; or

                           (E) if the applicable date of determination is during
                  a Seasonal Period, THE LEAST OF

                                    (I) 90% of the then extant Net Liquidation
                           Percentage times the value of Eligible In-Transit
                           Inventory,

                                    (II) 85% of the Cost value of Eligible
                           In-Transit Inventory,

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 6
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<PAGE>
                                                               EXECUTION VERSION

                                    (III) an amount equal to the then-applicable
                           In-Transit Inventory Sublimit,

                           plus, either (F) or (G) below, as applicable,

                           (F) if the applicable date of determination is not
                  during a Seasonal Period, THE LEAST OF

                                    (I) 85% of the then extant Net Liquidation
                           Percentage times the value of Qualified Letter of
                           Credit Inventory,

                                    (II) 85% of the Cost value of Qualified
                           Letter of Credit Inventory,

                                    (III) an amount equal to the Qualified
                           Letter of Credit Inventory Sublimit; or

                           (G) if the applicable date of determination is during
                  a Seasonal Period, THE LEAST OF

                                    (I) 90% of the then extant Net Liquidation
                           Percentage times the value of Qualified Letter of
                           Credit Inventory,

                                    (II) 85% of the Cost value of Qualified
                           Letter of Credit Inventory,

                                    (III) an amount equal to the Qualified
                           Letter of Credit Inventory Sublimit,

                           plus

                           (H) an amount equal to the outstanding principal
                  amount of the Restricted Advance, if any,

                           minus

                                    (I) the aggregate amount of Reserves, if
                           any, established by Agent under Section 2.1(b) and
                           Section 2.2."

         2.4 AMENDMENT TO SECTION 2.2(H). As of the Effective Date, Section
2.2(h) of the Loan Agreement is hereby amended and restated in its entirety to
read as follows:

                           "(h) Letter of Credit reserves in an amount equal, as
                  of any date, to the Letter of Credit Usage as of such date,
                  LESS the amount of the Guarantor's Deposit as of such date."

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 7
----------------------------------------------
<PAGE>
                                                               EXECUTION VERSION

         2.5 AMENDMENT TO SECTION 7.1(G). As of the Effective Date, Section
7.1(g) of the Loan Agreement is hereby amended and restated in its entirety to
read as follows:

                           "(g) Subordinated Indebtedness in an aggregate
         principal amount not to exceed the sum of $15,000,000 and the amount of
         any accrued but unpaid interest that is added to the principal balance
         outstanding under and in accordance with the terms of the Subordinated
         Loan Documents and to the extent (i) such Indebtedness shall be
         evidenced by Subordinated Loan Documents in form and substance
         satisfactory to Agent; and (ii) such Indebtedness, and any Liens
         securing the same, shall be subordinated to the Obligations, and any
         Liens securing the same, pursuant to the Intercreditor Agreement."

         2.6 ADDITION OF NEW SECTION 8.19. As of the Effective Date, a new
Section 8.19 of the Loan Agreement is hereby added to read in its entirety as
follows:

                  "8.19 If the obligation of the Letter of Credit Guarantor
          under its Letter of Credit Guaranty is limited or terminated by
          operation of law or by such Guarantor thereunder, other than in
          accordance with its terms."

3.       RATIFICATIONS, REPRESENTATIONS AND WARRANTIES.

         3.1 RATIFICATIONS. Except as expressly amended and supplemented by this
Amendment, the terms and provisions of the Loan Agreement are ratified and
confirmed and continue in full force and effect. The Borrowers hereby agree that
the Loan Agreement, as amended hereby, continues to be legal, valid, binding and
enforceable against Borrowers in accordance with its terms and hereby reaffirm
each covenant and agreement set forth therein.

         3.2 REPRESENTATIONS AND WARRANTIES. In order to induce Agent and Lender
to enter into this Amendment, each Borrower makes the following representations
and warranties to Lender as to itself:

                  (a) the execution, delivery and performance of this Amendment
         and any and all other Loan Documents executed and/or delivered in
         connection herewith have been authorized by all requisite corporate or
         limited partnership power, as appropriate, on the part of the Borrower
         and will not violate any of its constituent documents (including, as
         applicable, its articles of incorporation, certificate of
         incorporation, by-laws, partnership agreement and certificate of
         limited partnership) or any other agreement to which Borrower is a
         party or by which its properties may be bound;

                  (b) the representations and warranties contained in the Loan
         Agreement, as amended hereby, and any other Loan Document are true and
         correct in all material respects on and as of the date hereof as though
         made on and as of the date hereof (except to the extent that such
         representations and warranties relate solely to an earlier date or
         violations have been disclosed to Agent in writing and approved in
         writing by Agent); and

                  (c) no Default or Event of Default has occurred or is
         continuing under the Loan Agreement, and no Default or Event of Default
         will result from the execution,

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 8
----------------------------------------------
<PAGE>
                                                               EXECUTION VERSION

         delivery or performance of this Amendment or the consummation of the
         transactions herein authorized by Lender.

4.       FURTHER ASSURANCES.

          The Borrowers hereby agree, upon Agent's request (i) to deliver to
Agent such fully authorized and executed agreements and instruments, including,
but not limited to, any amendments to Loan Documents, within 10 days of such
request, and (ii) to take such actions as Agent, in its Permitted Discretion,
deems necessary and appropriate in connection with the transactions contemplated
by this Amendment.

5.       CHOICE OF LAW.

         THE VALIDITY OF THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS (UNLESS
EXPRESSLY PROVIDED TO THE CONTRARY THEREIN), THE CONSTRUCTION, INTERPRETATION,
AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND
THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED
HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.

6.       GENERAL PROVISIONS.

         6.1 EFFECTIVENESS. The effectiveness of this Amendment and the
enforceability of the terms hereof against Borrowers, Agent and Lender are
subject to fulfillment of each of the following conditions precedent:

                  (a) Lender's execution of this Amendment and receipt of one or
         more counterparts of this Amendment duly executed by each Borrower; and

                  (b) Lender's receipt of a consent and reaffirmation of the
         obligations of the Guarantors that are parties to the Continuing
         Guaranty and Security Agreement, in form acceptable to Lender; and

                  (c) Lender's receipt of copies of any and all documents and
         instruments executed in connection with the incurrence of additional
         Subordinated Indebtedness, which documents shall be in each instance
         acceptable to Agent and Lender in their sole discretion, including the
         Second Amended and Restated Subordinated Secured Promissory Note and
         the Second Global Amendment and Reaffirmation of Subordinated Debt
         Documents.

         6.2 SECTION HEADINGS. Headings and numbers have been set forth herein
for convenience only. Unless the contrary is compelled by the context,
everything contained in each Section applies equally to this entire Amendment.

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 9
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<PAGE>
                                                               EXECUTION VERSION

         6.3 SEVERABILITY OF PROVISIONS. Each provision of this Amendment will
be severable from every other provision of this Amendment for the purpose of
determining the legal enforceability of any specific provision.

         6.4 COUNTERPARTS; TELEFACSIMILE EXECUTION. This Amendment may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, will be deemed to be
an original, and all of which, when taken together, will constitute but one and
the same Amendment. Delivery of an executed counterpart of this Amendment by
telefacsimile will be equally as effective as delivery of an original executed
counterpart of this Amendment. Any party delivering an executed counterpart of
this Amendment by telefacsimile also will deliver an original executed
counterpart of this Amendment but the failure to deliver an original executed
counterpart will not affect the validity, enforceability, and binding effect of
this Amendment. The foregoing shall apply to each other Loan Document MUTATIS
MUTANDIS.

         6.5 INTEGRATION. This Amendment, the Loan Agreement and the other Loan
Documents contain the entire agreement between the parties relating to the
transactions contemplated hereby. All prior or contemporaneous understandings,
representations, statements and agreements, whether written or oral, are merged
herein and superseded by this Agreement. THIS WRITTEN AMENDMENT, THE LOAN
AGREEMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.

         6.6 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made herein and in the Loan Agreement, as amended hereby, will
survive the execution and delivery of this Amendment, and no investigation by
Agent or Lender or any closing shall affect the representations and warranties
or the right of Agent or Lender to rely upon them.

         6.7 REFERENCE TO LOAN AGREEMENT. The Loan Agreement, as amended hereby,
and all other agreements, documents or instruments now or hereafter executed and
delivered pursuant to the terms thereof are hereby amended so that any reference
in the Loan Agreement or such other agreements, documents and instruments will
mean a reference to the Loan Agreement, as amended hereby.

         6.8 EXPENSES OF LENDER. The Borrowers agree to pay on demand all
reasonable costs and expenses incurred by Lender in connection with the
preparation, negotiation and execution of this Amendment, including, without
limitation, the reasonable costs and fees of Agent's or Lender's legal counsel.
In addition, the Borrowers agree to pay on demand: (a) all costs and expenses
incurred by Agent or Lender in connection with the enforcement or preservation
of any rights under the Loan Agreement, as amended hereby, or any agreement,
document or instrument executed in connection therewith, including without
limitation this Amendment; and (b) all reasonable costs and expenses incurred by
Agent or Lender in connection with the preparation, negotiation and
administration of this Amendment, including the reasonable fees and costs of
Agent's and Lender's legal counsel.

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 10
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<PAGE>
                                                               EXECUTION VERSION

         6.9 SUCCESSORS AND ASSIGNS. This Amendment is binding upon and will
inure to the benefit of Agent, Lender and each Borrower and their respective
successors and assigns, except that no Borrower may assign or transfer any of
its rights or obligations hereunder without the prior written consent of Agent.

         6.10 RELEASE. EACH BORROWER HEREBY ACKNOWLEDGES THAT IT HAS NO DEFENSE,
COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE
WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF ITS
LIABILITY TO REPAY THE OBLIGATIONS (AS DEFINED IN THE LOAN AGREEMENT) OR TO SEEK
AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM AGENT, LENDER AND THEIR
RESPECTIVE PREDECESSORS, AGENTS, OFFICERS, DIRECTORS, MEMBERS, AFFILIATES,
EMPLOYEES AND REPRESENTATIVES, SUCCESSORS AND ASSIGNS. EACH BORROWER HEREBY
VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES AGENT, LENDER AND
THEIR RESPECTIVE PREDECESSORS, AGENTS, OFFICERS, DIRECTORS, MEMBERS, AFFILIATES,
EMPLOYEES AND REPRESENTATIVES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS,
DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES
WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR
UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING
IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AMENDMENT IS EXECUTED, WHICH SUCH
BORROWER MAY NOW OR HEREAFTER HAVE AGAINST AGENT, LENDER AND THEIR RESPECTIVE
PREDECESSORS, OFFICERS, DIRECTORS, MEMBERS, AFFILIATES, EMPLOYEES AND
REPRESENTATIVES, SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY
SUCH CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR
OTHERWISE, AND ARISING FROM ANY OBLIGATIONS (AS DEFINED IN THE LOAN AGREEMENT),
INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR, CHARGING, TAKING, RESERVING,
COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE MAXIMUM RATE, THE EXERCISE OF
ANY RIGHTS AND REMEDIES UNDER THE LOAN AGREEMENT OR ANY AGREEMENT, DOCUMENT OR
INSTRUMENT ENTERED INTO IN CONNECTION THEREWITH.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Page 11
----------------------------------------------
<PAGE>
                                                               EXECUTION VERSION

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered as of the date first above written.

                                       BORROWERS:

                                       HAROLD'S STORES, INC.

                                       By: /s/ Ron Staffieri
                                         ---------------------------------------
                                       Name: Ron Staffieri
                                       Title:    CEO

                                       HAROLD'S FINANCIAL CORPORATION

                                       By: /s/ Ron Staffieri
                                         ---------------------------------------
                                       Name: Ron Staffieri
                                       Title:    CEO

                                       HAROLD'S DIRECT, INC.

                                       By: /s/ Ron Staffieri
                                         ---------------------------------------
                                       Name: Ron Staffieri
                                       Title:    CEO

                                       HAROLD'S STORES OF TEXAS, L.P.

                                       By:   HSTX, Inc., General Partner

                                             By:  /s/ Ron Staffieri
                                               ---------------------------------
                                             Name:  Ron Staffieri
                                             Title:     CEO

                                       HAROLD'S OF JACKSON, INC.

                                       By: /s/ Ron Staffieri
                                         ---------------------------------------
                                       Name: Ron Staffieri
                                       Title:    CEO

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Signature Page
----------------------------------------------
<PAGE>
                                                               EXECUTION VERSION

                                       AGENT AND LENDER:

                                       WELLS FARGO RETAIL
                                       FINANCE II, LLC,
                                       AS AGENT AND LENDER

                                       By:   /s/ Lynn Whitmore
                                         ---------------------------------------
                                       Lynn Whitmore, Senior Vice President

AMENDMENT NO. 7 TO LOAN AND SECURITY AGREEMENT - Signature Page
----------------------------------------------

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