Document:

ex4-3.htm

    
      

    

    Exhibit
4.3

     

    (Multicurrency.Cross
Border)

    ISDA®

    International
Swap Dealers Association, Inc.

    

    MASTER
AGREEMENT

    

    dated as
of 15 May 2008

    

    AMERICA’S CAR-MART, INC., AN
ARKANSAS CORPORATION AND TEXAS CAR-

    MART, INC., A TEXAS
CORPORATION, (2.) COLONIAL AUTO FINANCE, INC., AN

    ARKANSAS
CORPORATION.
     and      BANK OF
OKLAHOMA, N.A.

    

    have
entered and/or anticipate entering into one or more transactions (each a
“Transaction”) that are or will be governed by this Master Agreement, which
includes the schedule (The Schedule”), and the documents and other confirming
evidence (each a “Confirmation”) exchanged between the parties confirming those
Transactions.

    

    Accordingly,
the parties agree as follows:

    

    1.           Interpretation

    

    (a)          Definitions.
The terms defined in Section 14 and in the Schedule will have the meanings
therein specified for the purpose of this Master Agreement.

    

    (b)          Inconsistency.
In the event of any inconsistency between the provisions of the Schedule and the
other provisions of this Master Agreement, the Schedule will prevail. In the
event of any inconsistency between the provisions of any Confirmation and this
Master Agreement (including the Schedule), such Confirmation will prevail for
the purpose of the relevant Transaction.

    

    (c)          Single
Agreement. All Transactions are entered into in reliance on the fact that
this Master Agreement and all Confirmations form a single agreement between the
parties (collectively referred to as this "Agreement"), and the parties would
not otherwise enter into any Transactions.

    

    2.           Obligations

    

    (a)          General
Conditions.

     

    (i)  Each
party will make each payment or delivery specified in each Confirmation to be
made by it, subject to the other provisions of this Agreement.

    

    (ii)  Payments
under this Agreement will be made on the due date for value on that date in the
place of the account specified in the relevant Confirmation or otherwise
pursuant to this Agreement, in freely transferable funds and in the manner
customary for payments in the required currency. Where settlement is by delivery
(that is, other than by payment), such delivery will be made for receipt on the
due date in the manner customary for the relevant obligation unless otherwise
specified in the relevant Confirmation or elsewhere in this
Agreement.

    

    (iii)  Each
obligation of each party under Section 2(a)(i) is subject to (1) the condition
precedent that no Event of Default or Potential Event of Default with respect to
the other party has occurred and is continuing, (2) the condition precedent that
no Early Termination Date in respect of the relevant Transaction has occurred or
been effectively designated and (3) each other applicable condition precedent
specified in this Agreement.

     

    
      Copyright
© 1992 by International Swap Dealers Association, Inc.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)          Change of
Account.  Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a reasonable
objection to such change.

    

    (c)           Netting.  If
on any date amounts would otherwise be payable:

    

    (i)  in
the same currency; and

    

    (ii)  in
respect of the same Transaction,

    

    by each
party to the other, then, on such date, each party's obligation to make payment
of any such amount will be automatically satisfied and discharged and, if the
aggregate amount that would otherwise have been payable by one party exceeds the
aggregate amount that would otherwise have been payable by the other party,
replaced by an obligation upon the party by whom the larger aggregate amount
would have been payable to pay to the other party the excess of the larger
aggregate amount over the smaller aggregate amount.

    

    The
parties may elect in respect of two or more Transactions that a net amount will
be determined in respect of all amounts payable on the same date in the same
currency in respect of such Transactions, regardless of whether such amounts are
payable in respect of the same Transaction. The election may be made in the
Schedule or a Confirmation by specifying that subparagraph (ii) above will not
apply to the Transactions identified as being subject to the election, together
with the starting date (in which case subparagraph (ii) above will not, or will
cease to, apply to such Transactions from such date). This election may be made
separately for different groups of Transactions and will apply separately to
each pairing of Offices through which the parties make and receive payments or
deliveries.

    

    (d)          Deduction or
Withholding for Tax.

    

    (i)  Gross-up.
All payments under this Agreement will be made without any deduction or
withholding for or on account of any Tax unless such deduction or withholding is
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, then in effect. If a party is so required to
deduct or withhold, then that party ("X") will:

    

    (1)  promptly
notify the other party ("Y") of such requirement;

    

    (2)  pay
to the relevant authorities the full amount required to be deducted or withheld
(including the full amount required to be deducted or withheld from any
additional amount paid by X to Y under this Section 2(d)) promptly upon the
earlier of determining that such deduction or withholding is required or
receiving notice that such amount has been assessed against Y;

    

    (3)  promptly
forward to Y an official receipt (or a certified copy), or other documentation
reasonably acceptable to Y, evidencing such payment to such authorities;
and

    

    (4)  if
such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which
Y is otherwise entitled under this Agreement, such additional amount as is
necessary to ensure that the net amount actually received by Y (free and clear
of Indemnifiable Taxes, whether assessed against X or Y) will equal the full
amount Y would have received had no such deduction or withholding been required.
However, X will not be required to pay any additional amount to Y to the extent
that it would not be required to be paid but for:

    

    (A)  the
failure by Y to comply with or perform any agreement contained in Section
4(a)(i), 4(a)(iii) or 4(d); or

    

    (B)  the
failure of a representation made by Y pursuant to Section 3(f) to be accurate
and true unless such failure would not have occurred but for (I) any action
taken by a taxing authority, or brought in a court of competent jurisdiction, on
or after the date on which a Transaction is entered into (regardless of whether
such action is taken or brought with respect to a party to this Agreement) or
(II) a Change in Tax Law.

     

    
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    (ii)  Liability.
If:

    

    (1)  X
is required by any applicable law, as modified by the practice of any
relevant  governmental revenue authority, to make any deduction or
withholding in respect of which X  would not be required to pay an
additional amount to Y under Section 2(d)(i)(4);

    

    (2)  X
does not so deduct or withhold; and

    

    (3)  a
liability resulting from such Tax is assessed directly against X,

    

    then,
except to the extent Y has satisfied or then satisfies the liability resulting
from such Tax, Y will promptly pay to X the amount of such liability (including
any related liability for interest, but including any related liability for
penalties only if Y has failed to comply with or perform any agreement contained
in Section 4(a)(i), 4(a)(iii) or 4(d)).

    

    (e)           Default Interest;
Other Amounts. Prior to the occurrence or effective designation of an
Early Termination Date in respect of the relevant Transaction, a party that
defaults in the performance of any payment obligation will, to the extent
permitted by law and subject to Section 6(c), be required to pay interest
(before as well as after judgment) on the overdue amount to the other party on
demand in the same currency as such overdue amount, for the period from (and
including) the original due date for payment to (but excluding) the date of
actual payment, at the Default Rate. Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed. If, prior to
the occurrence or effective designation of an Early Termination Date in respect
of the relevant Transaction, a party defaults in the performance of any
obligation required to be settled by delivery, it will compensate the other
party on demand if and to the extent provided for in the relevant Confirmation
or elsewhere in this Agreement.

    

    3.           Representations

    

    Each
party represents to the other party (which representations will be deemed to be
repeated by each

    party on
each date on which a Transaction is entered into and, in the case of the
representations in Section

    3(f), at
all times until the termination of this Agreement) that:

    

    (a)           Basic
Representations.

    

    (i)  Status. It
is duly organized and validly existing under the laws of the jurisdiction of
its

    organization
or incorporation and, if relevant under such laws, in good
standing;

    

    (ii)  Powers. It
has the power to execute this Agreement and any other documentation relating to
this Agreement to which it is a party, to deliver this Agreement and any other
documentation relating to this Agreement that it is required by this Agreement
to deliver and to perform its obligations under this Agreement and any
obligations it has under any Credit Support Document to which it is a party and
has taken all necessary action to authorize such execution, delivery and
performance;

    

    (iii)  No Violation or
Conflict. Such execution, delivery and performance do not violate or
conflict with any law applicable to it, any provision of its constitutional
documents, any order or judgment of any court or other agency of government
applicable to it or any of its assets or any contractual restriction binding on
or affecting it or any of its assets;

    

    (iv)  Consents.
All governmental and other consents that are required to have been obtained by
it with respect to this Agreement or any Credit Support Document to which it is
a party have been obtained and are in full force and effect and all conditions
of any such consents have been complied with; and

    

    (v)  Obligations
Binding. Its obligations under this Agreement and any Credit Support
Document to which it is a party constitute its legal, valid and binding
obligations, enforceable in accordance with their respective terms (subject to
applicable bankruptcy, reorganization, insolvency, moratorium or similar laws
affecting creditors' rights generally and subject, as to enforceability, to
equitable principles of general application (regardless of whether enforcement
is sought in a proceeding in equity or at law)).

     

    
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    (b)           Absence of
Certain Events. No Event of Default or Potential Event of Default or, to
its knowledge, Termination Event with respect to it has occurred and is
continuing and no such event or circumstance would occur as a result of its
entering into or performing its obligations under this Agreement or any Credit
Support Document to which it is a party.

    

    (c)           Absence of
Litigation. There is not pending or, to its knowledge, threatened against
it or any of its Affiliates any action, suit or proceeding at law or in equity
or before any court, tribunal, governmental body, agency or official or any
arbitrator that is likely to affect the legality, validity or enforceability
against it of this Agreement or any Credit Support Document to which it is a
party or its ability to perform its obligations under this Agreement or such
Credit Support Document.

    

    (d)           Accuracy of
Specified Information. All applicable information that is furnished in
writing by or on behalf of it to the other party and is identified for the
purpose of this Section 3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.

    

    (e)           Payer Tax
Representation. Each representation specified in the Schedule as being
made by it for the purpose of this Section 3(e) is accurate and
true.

    

    (f)           Payee Tax
Representations. Each representation specified in the Schedule as being
made by it for the purpose of this Section 3(f) is accurate and
true.

    

    4.           Agreements

    

    Each
party agrees with the other that, so long as either party has or may have any
obligation under this Agreement or under any Credit Support Document to which it
is a party:

    

    (a)           Furnish Specified
Information. It will deliver to the other party or, in certain cases
under subparagraph (iii) below, to such government or taxing authority as the
other party reasonably directs:

    

    (i)  any
forms, documents or certificates relating to taxation specified in the Schedule
or any Confirmation;

    

    (ii)  any
other documents specified in the Schedule or any Confirmation; and

    

    (iii)  upon
reasonable demand by such other party, any form or document that may be required
or reasonably requested in writing in order to allow such other party or its
Credit Support Provider to make a payment under this Agreement or any applicable
Credit Support Document without any deduction or withholding for or on account
of any Tax or with such deduction or withholding at a reduced rate (so long as
the completion, execution or submission of such form or document would not
materially prejudice the legal or commercial position of the party in receipt of
such demand), with any such form or document to be accurate and completed in a
manner reasonably satisfactory to such other party and to be executed and to be
delivered with any reasonably required certification,

    

    in each
case by the date specified in the Schedule or such Confirmation or, if none is
specified, as soon as reasonably practicable.

    

    (b)           Maintain
Authorizations. It will use all reasonable efforts to maintain in full
force and effect all consents of any governmental or other authority that are
required to be obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party and will use all reasonable efforts to
obtain any that may become necessary in the future.

    

    (c)           Comply with
Laws. It will comply in all material respects with all applicable laws
and orders to which it may be subject if failure so to comply would materially
impair its ability to perform its obligations under this Agreement or any Credit
Support Document to which it is a party.

    

    (d)           Tax
Agreement. It will give notice of any failure of a representation made by
it under Section 3(f) to be accurate and true promptly upon learning of such
failure.

     

    
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    (e)           Payment of Stamp
Tax. Subject to Section 11, it will pay any Stamp Tax levied or imposed
upon it or in respect of its execution or performance of this Agreement by a
jurisdiction in which it is incorporated, organized, managed and controlled, or
considered to have its seat, or in which a branch or office through which it is
acting for the purpose of this Agreement is located ("Stamp Tax Jurisdiction")
and will indemnify the other party against any Stamp Tax levied or imposed upon
the other party or in respect of the other party's execution or performance of
this Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax
Jurisdiction with respect to the other party.

    

    5.            Events
of Default and Termination Events

    

    (a)           Events of
Default. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of
such party of any of the following events constitutes an event of default (an
"Event of Default") with respect to such party:

    

    (i)  Failure to Pay or
Deliver. Failure by the party to make, when due, any payment under this
Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if
such failure is not remedied on or before the third Local Business Day after
notice of such failure is given to the party;

    

    (ii)  Breach of
Agreement. Failure by the party to comply with or perform any agreement
or obligation (other than an obligation to make any payment under this Agreement
or delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination
Event or any agreement or obligation under Section 4(a)(i), 4(a)(iii) or 4(d))
to be complied with or performed by the party in accordance with this Agreement
if such failure is not remedied on or before the thirtieth day after notice of
such failure is given to the party;

    

    (iii)  Credit Support
Default.

    

    (1)  Failure
by the party or any Credit Support Provider of such party to comply with or
perform any agreement or obligation to be complied with or performed by it in
accordance with any Credit Support Document if such failure is continuing after
any applicable grace period has elapsed;

    

    (2)  the
expiration or termination of such Credit Support Document or the failing or
ceasing of such Credit Support Document to be in full force and effect for the
purpose of this Agreement (in either case other than in accordance with its
terms) prior to the satisfaction of all obligations of such party under each
Transaction to which such Credit Support Document relates without the written
consent of the other party; or

    

    (3)  the
party or such Credit Support Provider disaffirms, disclaims, repudiates or
rejects, in whole or in part, or challenges the validity of, such Credit Support
Document;

    

    (iv)  Misrepresentation.
A representation (other than a representation under Section 3(e) or (f) made or
repeated or deemed to have been made or repeated by the party or any Credit
Support Provider of such party in this Agreement or any Credit Support Document
proves to have been incorrect or misleading in any material respect when made or
repeated or deemed to have been made or repeated;

    

    (v)  Default under
Specified Transaction. The party, any Credit Support Provider of such
party or any applicable Specified Entity of such party (1) defaults under a
Specified Transaction and, after giving effect to any applicable notice
requirement or grace period, there occurs a liquidation of, an acceleration of
obligations under, or an early termination of, that Specified Transaction, (2)
defaults, after giving effect to any applicable notice requirement or grace
period, in making any payment or delivery due on the last payment, delivery or
exchange date of, or any payment on early termination of, a Specified
Transaction (or such default continues for at least three Local Business Days if
there is no applicable notice requirement or grace period) or (3) disaffirms,
disclaims, repudiates or rejects, in whole or in part, a Specified Transaction
(or such action is taken by any person or entity appointed or empowered to
operate it or act on its behalf);

    

    (vi)  Cross
Default. If "Cross Default" is specified in the Schedule as applying to
the party, the occurrence or existence of (1) a default, event of default or
other similar condition or event (however described) in respect of such party,
any Credit Support Provider of such party or any applicable Specified Entity of
such party under one or more agreements or instruments relating to Specified
Indebtedness of any of them (individually or collectively) in an aggregate
amount of not less than the applicable Threshold Amount (as specified in the
Schedule) which has resulted in such Specified Indebtedness becoming, or
becoming capable at such time of being declared, due and payable under such
agreements or instruments, before it would otherwise have been due and payable
or (2) a default by such party, such Credit Support Provider or such Specified
Entity (individually or collectively) in making one or more payments on the due
date thereof in an aggregate amount of not less than the applicable Threshold
Amount under such agreements or instruments (after giving effect to any
applicable notice requirement or grace period);

     

    
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    (vii)  Bankruptcy.
The party, any Credit Support Provider of such party or any applicable Specified
Entity of such party:

    

    (1) is
dissolved (other than pursuant to a consolidation, amalgamation or merger); (2)
becomes insolvent or is unable to pay its debts or fails or admits in writing
its inability generally to pay its debts as they become due; (3) makes a general
assignment, arrangement or composition with or for the benefit of its creditors;
(4) institutes or has instituted against it a proceeding seeking a judgment of
insolvency or bankruptcy or any other relief under any bankruptcy or insolvency
law or other similar law affecting creditors' rights, or a petition is presented
for its winding-up or liquidation, and, in the case of any such proceeding or
petition instituted or presented against it, such proceeding or petition (A)
results in a judgment of insolvency or bankruptcy or the entry of an order for
relief or the making of an order for its winding-up or liquidation or (B) is not
dismissed, discharged, stayed or restrained in each case within 30 days of the
institution or presentation thereof; (5) has a resolution passed for its
winding-up, official management or liquidation (other than pursuant to a
consolidation, amalgamation or merger); (6) seeks or becomes subject to the
appointment of an administrator, provisional liquidator, conservator, receiver,
trustee, custodian or other similar official for it or for all or substantially
all its assets; (7) has a secured party take possession of all or substantially
all its assets or has a distress, execution, attachment, sequestration or other
legal process levied, enforced or sued on or against all or substantially all
its assets and such secured party maintains possession, or any such process is
not dismissed, discharged, stayed or restrained, in each case within 30 days
thereafter; (8) causes or is subject to any event with respect to it which,
under the applicable laws of any jurisdiction, has an analogous effect to any of
the events specified in clauses (1) to (7) (inclusive); or (9) takes any action
in furtherance of, or indicating its consent to, approval of, or acquiescence
in, any of the foregoing acts; or

    

    (viii)  Merger Without
Assumption. The party or any Credit Support Provider of such party
consolidates or amalgamates with, or merges with or into, or transfers all or
substantially all its assets to, another entity and, at the time of such
consolidation, amalgamation, merger or transfer:

    

    (1)  the
resulting, surviving or transferee entity fails to assume all the obligations of
such party or such Credit Support Provider under this Agreement or any Credit
Support Document to which it or its predecessor was a party by operation of law
or pursuant to an agreement reasonably satisfactory to the other party to this
Agreement; or

    

    (2) the
benefits of any Credit Support Document fail to extend (without the consent of
the other party) to the performance by such resulting, surviving or transferee
entity of its obligations under this Agreement.

    

    (b)           Termination
Events. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of
such party of any event specified below constitutes an Illegality if the event
is specified in (i) below, a Tax Event if the event is specified in (ii) below
or a Tax Event Upon Merger if the event is specified in (iii) below, and if
specified to be applicable, a Credit Event.

    

    Upon
Merger if the event is specified pursuant to (iv) below or an Additional
Termination Event if the event is specified pursuant to (v) below:

     

    
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    (i)  Illegality.
Due to the adoption of, or any change in, any applicable law after the date on
which a Transaction is entered into, or due to the promulgation of, or any
change in, the interpretation by any court, tribunal or regulatory authority
with competent jurisdiction of any applicable law after such date, it becomes
unlawful (other than as a result of a breach by the party of Section 4(b)) for
such party (which will be the Affected Party):

    

    (1)  to
perform any absolute or contingent obligation to make a payment or delivery or
to receive a payment or delivery in respect of such Transaction or to comply
with any other material provision of this Agreement relating to such
Transaction; or

    

    (2)  to
perform, or for any Credit Support Provider of such party to perform, any
contingent or other obligation which the party (or such Credit Support Provider)
has under any Credit Support Document relating to such Transaction;

    

    (ii)  Tax Event.
Due to (x) any action taken by a taxing authority, or brought in a court of
competent jurisdiction, on or after the date on which a Transaction is entered
into (regardless of whether such action is taken or brought with respect to a
party to this Agreement) or (y) a Change in Tax Law, the party (which will be
the Affected Party) will, or there is a substantial likelihood that it will, on
the next succeeding Scheduled Payment Date (1) be required to pay to the other
party an additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6 (e))
or (2) receive a payment from which an amount is required to be deducted or
withheld for or on account of a Tax (except in respect of interest under Section
2(e), 6(d)(ii) or 6(e)) and no additional amount is required to be paid in
respect of such Tax under Section 2(d)(i)(4) (other than by reason of Section
2(d)(i)(4)(A) or (B));

    

    (iii)  Tax Event Upon
Merger. The party (the "Burdened Party") on the next succeeding Scheduled
Payment Date will either (1) be required to pay an additional amount in respect
of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest
under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an
amount has been deducted or withheld for or on account of any Indemnifiable Tax
in respect of which the other party is not required to pay an additional amount
(other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a
result of a party consolidating or amalgamating with, or merging with or into,
or transferring all or substantially all its assets to, another entity (which
will be the Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);

    

    (iv)  Credit Event Upon
Merger. If "Credit Event Upon Merger" is specified in the Schedule as
applying to the party, such party ("X"), any Credit Support Provider of X or any
applicable Specified Entity of X consolidates or amalgamates with, or merges
with or into, or transfers all or substantially all its assets to, another
entity and such action does not constitute an event described in Section
5(a)(viii) but the creditworthiness of the resulting, surviving or transferee
entity is materially weaker than that of X, such Credit Support Provider or such
Specified Entity, as the case may be, immediately prior to such action (and, in
such event, X or its successor or transferee, as appropriate, will be the
Affected Party); or

    

    (v)  Additional
Termination Event. If any "Additional Termination Event" is specified in
the Schedule or any Confirmation as applying, the occurrence of such event (and,
in such event, the Affected Party or Affected Parties shall be as specified for
such Additional Termination Event in the Schedule or such
Confirmation).

    

    (c)           Event of Default
and Illegality. If an event or circumstance which would otherwise
constitute or give rise to an Event of Default also constitutes an Illegality,
it will be treated as an Illegality and will not constitute an Event of
Default.

    

    6.           Early
Termination

    

    (a)           Right to
Terminate Following Event of Default. If at any time an Event of Default
with respect to a party (the "Defaulting Party") has occurred and is then
continuing, the other party (the "Non-defaulting Party") may, by not more than
20 days notice to the Defaulting Party specifying the relevant Event of Default,
designate a day not earlier than the day such notice is effective as an Early
Termination Date in respect of all outstanding Transactions. If, however,
"Automatic Early Termination" is specified in the Schedule as applying to a
party, then an Early Termination Date in respect of all outstanding Transactions
will occur immediately upon the occurrence with respect to such party of an
Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the
extent analogous thereto, (8), and as of the time immediately preceding the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto,
(8).

     

    
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    (b)           Right to
Terminate Following Termination Event.

    

    (i)  Notice. If
a Termination Event occurs, an Affected Party will, promptly upon becoming aware
of it, notify the other party, specifying the nature of that Termination Event
and each Affected Transaction and will also give such other information about
that Termination Event as the other party may reasonably require.

    

    (ii)  Transfer to Avoid
Termination Event. If either an Illegality under Section 5(b)(i)(1) or a
Tax Event occurs and there is only one Affected Party, or if a Tax Event Upon
Merger occurs and the Burdened Party is the Affected Party, the Affected Party
will, as a condition to its right to designate an Early Termination Date under
Section 6(b)(iv), use all reasonable efforts (which will not require such party
to incur a loss, excluding immaterial, incidental expenses) to transfer within
20 days after it gives notice under Section 6(b)(i) all its rights and
obligations under this Agreement in respect of the Affected Transactions to
another of its Offices or Affiliates so that such Termination Event ceases to
exist.

    

    If the
Affected Party is not able to make such a transfer it will give notice to the
other party to that effect within such 20 day period, whereupon the other party
may effect such a transfer within 30 days after the notice is given under
Section 6(b)(i).

    

    Any such
transfer by a party under this Section 6(b)(ii) will be subject to and
conditional upon the prior written consent of the other party, which consent
will not be withheld if such other party's policies in effect at such time would
permit it to enter into transactions with the transferee on the terms
proposed.

    

    (iii)  Two Affected
Parties. If an Illegality under Section 5(b)(i)(1) or a Tax Event occurs
and there are two Affected Parties, each party will use all reasonable efforts
to reach agreement within 30 days after notice thereof is given under Section
6(b)(i) on action to avoid that Termination Event.

    

    (iv)  Right to
Terminate. If:

    

    (1)  a
transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the
case may be, has not been effected with respect to all Affected Transactions
within 30 days after an Affected Party gives notice under Section 6(b)(i);
or

    

    (2)  an
Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional
Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened
Party is not the Affected Party,

    

    either
party in the case of an Illegality, the Burdened Party in the case of a Tax
Event Upon Merger, any Affected Party in the case of a Tax Event or an
Additional Termination Event if there is more than one Affected Party, or the
party which is not the Affected Party in the case of a Credit Event Upon Merger
or an Additional Termination Event if there is only one Affected Party may, by
not more than 20 days notice to the other party and provided that the relevant
Termination Event is then continuing, designate a day not earlier than the day
such notice is effective as an Early Termination Date in respect of all Affected
Transactions.

    

    (c)           Effect of
Designation.

    

    (i) If
notice designating an Early Termination Date is given under Section 6(a) or (b),
the Early Termination Date will occur on the date so designated, whether or not
the relevant Event of Default or Termination Event is then
continuing.

     

    
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    (ii) Upon
the occurrence or effective designation of an Early Termination Date, no further
payments or deliveries under Section 2(a)(i) or 2(e) in respect of the
Terminated Transactions will be required to be made, but without prejudice to
the other provisions of this Agreement. The amount, if any, payable in respect
of an Early Termination Date shall be determined pursuant to Section
6(e).

    

    (d)           Calculations.

    

    (i)  Statement.
On or as soon as reasonably practicable following the occurrence of an Early
Termination Date, each party will make the calculations on its part, if any,
contemplated by Section 6(e) and will provide to the other party a statement (1)
showing, i n reasonable detail, such calculations (including all relevant
quotations and specifying any amount payable under Section 6(e)) and (2) giving
details of the relevant account to which any amount payable to it is to be paid.
In the absence of written confirmation from the source of a quotation obtained
in determining a Market Quotation, the records of the party obtaining such
quotation will be conclusive evidence of the existence and accuracy of such
quotation.

    

    (ii)  Payment
Date. An amount calculated as being due in respect of any Early
Termination Date under Section 6(e) will be payable on the day that notice of
the amount payable is effective (in the case of an Early Termination Date which
is designated or occurs as a result of an Event of Default) and on the day which
is two Local Business Days after the day on which notice of the amount payable
is effective (in the case of an Early Termination Date which is designated as a
result of a Termination Event). Such amount will be paid together with (to the
extent permitted under applicable law) interest thereon (before as well as after
judgment) in the Termination Currency, from (and including) the relevant Early
Termination Date to (but excluding) the date such amount is paid, at the
Applicable Rate. Such interest will be calculated on the basis of daily
compounding and the actual number of days elapsed.

    

    (e)           Payments on Early
Termination. If an Early Termination Date occurs, the following
provisions shall apply based on the parties' election in the Schedule of a
payment measure, either "Market Quotation" or "Loss", and a payment method,
either the "First Method" or the "Second Method". If the parties fail to
designate a payment measure or payment method in the Schedule, it will be deemed
that "Market Quotation" or the "Second Method", as the case may be, shall apply.
The amount, if any, payable in respect of an Early Termination Date and
determined pursuant to this Section will be subject to any Set-off.

    

    (i)  Events of
Default. If the Early Termination Date results from an Event of
Default:

    

    (1)  First Method and
Market Quotation. If the First Method and Market Quotation apply, the
Defaulting Party will pay to the Non-defaulting Party the excess, if a positive
number, of (A) the sum of the Settlement Amount (determined by the
Non-defaulting Party) in respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid
Amounts owing to the Defaulting Party.

    

    (2)  First Method and
Loss. If the First Method and Loss apply, the Defaulting Party will pay
to the Non-defaulting Party, if a positive number, the Non-defaulting Party's
Loss in respect of this Agreement.

    

    (3)  Second Method and
Market Quotation. If the Second Method and Market Quotation apply, an
amount will be payable equal to (A) the sum of the Settlement Amount (determined
by the  Non-defaulting Party) in respect of the Terminated
Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing
to the Non-defaulting Party less (B) the Termination Currency Equivalent of the
Unpaid Amounts owing to the Defaulting Party. If that amount is a positive
number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a
negative number, the Non-defaulting Party will pay the absolute value of that
amount to the Defaulting Party.

     

    
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    (4)  Second Method and
Loss. If the Second Method and Loss apply, an amount will be payable
equal to the Non-defaulting Party's Loss in respect of this Agreement. If that
amount is a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the Non-defaulting Party will
pay the absolute value of that amount to the Defaulting Party.

    

    (ii)  Termination
Events. If the Early Termination Date results from a Termination
Event:

    

    (1)  One Affected
Party. If there is one Affected Party, the amount payable will be
determined in accordance with Section 6(e)(i)(3), if Market Quotation applies,
or Section 6(e)(i)(4), if Loss applies, except that, in either case, references
to the Defaulting Party and to the Non-defaulting Party will be deemed to be
references to the Affected Party and the Party which is not the Affected Party,
respectively, and if Loss applies and fewer than all Transactions are being
terminated, Loss shall be calculated in respect of all Terminated
Transactions.

    

    (2)  Two Affected
Parties. If there are two Affected Parties:

    

    (A) if
Market Quotation applies, each party will determine a Settlement Amount in
respect of the Terminated Transactions, and an amount will be payable equal to
(I) the sum of (a) one-half of the difference between the Settlement Amount of
the Party with the higher Settlement Amount ("X") and the Settlement Amount of
the party with the lower Settlement Amount ("Y") and (b) the Termination
Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination
Currency Equivalent of the Unpaid Amounts owing to Y; and

    

    (B) if
Loss applies, each party will determine its Loss in respect of this Agreement
(or, if fewer than all the Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable equal to one-half of the
difference between the Loss of the party with the higher Loss ("X") and the Loss
of the party with the lower Loss ("Y").

    

    If the
amount payable is a positive number, Y will pay it to X; if it is a negative
number, X will pay the absolute value of that amount to Y.

    

    (iii)  Adjustment for
Bankruptcy. In circumstances where an Early Termination Date occurs
because "Automatic Early Termination" applies in respect of a party, the amount
determined under this Section 6(e) will be subject to such adjustments as are
appropriate and permitted by law to reflect any payments or deliveries made by
one party to the other under this Agreement (and retained by such other party)
during the period from the relevant Early Termination Date to the date for
payment determined under Section 6(d)(ii).

    

    (iv)  Pre-Estimate.
The parties agree that if Market Quotation applies an amount recoverable under
this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such
amount is payable for the loss of bargain and the loss of protection against
future risks and except as otherwise provided in this Agreement neither party
will be entitled to recover any additional damages as a consequence of such
losses.

    

    7.           
Transfer

    

    Subject
to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or
under this Agreement may be transferred (whether by way of security or
otherwise) by either party without the prior written consent of the other party,
except that:

    

    (a)           a
party may make such a transfer of this Agreement pursuant to a consolidation or
amalgamation with, or merger with or into, or transfer of all or substantially
all its assets to, another entity (but without prejudice to any other right or
remedy under this Agreement); and

    

    (b)           a
party may make such a transfer of all or any part of its interest in any amount
payable to it from a Defaulting Party under Section 6(e).

    

    Any
purported transfer that is not in compliance with this Section will be
void.

     

    
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8.           
 Contractual Currency

    

    (a)           Payment in the
Contractual Currency. Each payment under this Agreement will be made in
the relevant currency specified in this Agreement for that payment (the
"Contractual Currency"). To the extent permitted by applicable law, any
obligation to make payments under this Agreement in the Contractual Currency
will not be discharged or satisfied by any tender in any currency other than the
Contractual Currency, except to the extent such tender results in the actual
receipt by the party to which payment is owed, acting in a reasonable manner and
in good faith in converting the currency so tendered into the Contractual
Currency, of the full amount in the Contractual Currency of all amounts payable
in respect of this Agreement. If for any reason the amount in the Contractual
Currency so received falls short of the amount in the Contractual Currency
payable in respect of this Agreement, the party required to make the payment
will, to the extent permitted by applicable law, immediately pay such additional
amount in the Contractual Currency as may be necessary to compensate for the
shortfall. If for any reason the amount in the Contractual Currency so received
exceeds the amount in the Contractual Currency payable in respect of this
Agreement, the party receiving the payment will refund promptly the amount of
such excess.

    

    (b)           Judgments.
To the extent permitted by applicable law, if any judgment or order expressed in
a currency other than the Contractual Currency is rendered (i) for the payment
of any amount owing in respect of this Agreement, (ii) for the payment of any
amount relating to any early termination in respect of this Agreement or (iii)
in respect of a judgment or order of another court for the payment of any amount
described in (i) or (ii) above, the party seeking recovery, after recovery in
full of the aggregate amount to which such party is entitled pursuant to the
judgment or order, will be entitled to receive immediately from the other party
the amount of any shortfall of the Contractual Currency received by such party
as a consequence of sums paid in such other currency and will refund promptly to
the other party any excess of the Contractual Currency received by such party as
a consequence of sums paid in such other currency if such shortfall or such
excess arises or results from any variation between the rate of exchange at
which the Contractual Currency is converted into the currency of the judgment or
order for the purposes of such judgment or order and the rate of exchange at
which such party is able, acting in a reasonable manner and in good faith in
converting the currency received into the Contractual Currency, to purchase the
Contractual Currency with the amount of the currency of the judgment or order
actually received by such party. The term "rate of exchange" includes, without
limitation, any premiums and costs of exchange payable in connection with the
purchase of or conversion into the Contractual Currency.

    

    (c)           Separate
Indemnities. To the extent permitted by applicable law, these indemnities
constitute separate and independent obligations from the other obligations in
this Agreement, will be enforceable as separate and independent causes of
action, will apply notwithstanding any indulgence granted by the party to which
any payment is owed and will not be affected by judgment being obtained or claim
or proof being made for any other sums payable in respect of this
Agreement.

    

    (d)           Evidence of
Loss. For the purpose of this Section 8, it will be sufficient for a
party to demonstrate that it would have suffered a loss had an actual exchange
or purchase been made.

    

    9.           Miscellaneous

    

    (a)           Entire
Agreement. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.

    

    (b)           Amendments.
No amendment, modification or waiver in respect of this Agreement will be
effective unless in writing (including a writing evidenced by a facsimile
transmission) and executed by each of the parties or confirmed by an exchange of
telexes or electronic messages on an electronic messaging system.

    

    (c)           Survival of
Obligations. Without prejudice to Section 2(a)(iii) and 6(c)(ii), the
obligations of the parties under this Agreement will survive the termination of
any Transaction.

    

    (d)           Remedies
Cumulative. Except as provided in this Agreement, the rights, powers,
remedies and privileges provided in this Agreement are cumulative and not
exclusive of any rights, powers, remedies and privileges provided by
law.

     

    
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    (e)           Counterparts and
Confirmations.

    

    (i)  This
Agreement (and each amendment, modification and waiver in respect of it) may be
executed and delivered in counterparts (including by facsimile transmission),
each of which will be deemed an original.

    

    (ii)  The
parties intend that they are legally bound by the terms of each Transaction from
the moment they agree to those terms (whether orally or otherwise). A
Confirmation shall be entered into as soon as practicable and may be executed
and delivered in counterparts (including by facsimile transmission) or be
created by an exchange of telexes or by an exchange of electronic messages on an
electronic messaging system, which in each case will be sufficient for all
purposes to evidence a binding supplement to this Agreement. The parties will
specify therein or through another effective means that any such counterpart,
telex or electronic message constitutes a Confirmation.

    

    (f)       
    No Waiver of
Rights. A failure or delay in exercising any right, power or privilege in
respect of this Agreement will not be presumed to operate as a waiver, and a
single or partial exercise of any right, power or privilege will not be presumed
to preclude any subsequent or further exercise, of that right, power or
privilege or the exercise of any other right, power or privilege.

    

    (g)           Headings.
The headings used in this Agreement are for convenience of reference only and
are not to affect the construction of or to be taken into consideration in
interpreting this Agreement.

    

    10.           Offices;
Multibranch Parties

    

    (a)           If
Section 10(a) is specified in the Schedule as applying, each party that enters
into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking office
or jurisdiction of incorporation or organization of such party, the obligations
of such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.

    

    (b)           Neither
party may change the Office through which it makes and receives payments or
deliveries for the purpose of a Transaction without the prior written consent of
the other party.

    

    (c)           If
a party is specified as a Multibranch Party in the Schedule, such Multibranch
Party may make and receive payments or deliveries under any Transaction through
any Office listed in the Schedule, and the Office through which it makes and
receives payments or deliveries with respect to a Transaction will be specified
in the relevant Confirmation.

    

    11.           Expenses

    

    A
Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early termination of
any Transaction, including, but not limited to, costs of
collection.

    

    12.           Notices

    

    (a)           Effectiveness.
Any notice or other communication in respect of this Agreement may be given in
any

    manner
set forth below (except that a notice or other communication under Section 5 or
6 may not be

    given by
facsimile transmission or electronic messaging system) to the address or number
or in

    accordance
with the electronic messaging system details provided (see the Schedule) and
will be deemed

    effective
as indicated:

    

    (i) if in
writing and delivered in person or by courier, on the date it is
delivered;

    

    (ii) if
sent by telex, on the date the recipient's answerback is received;

     

    
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    (iii) if
sent by facsimile transmission, on the date that transmission is received by a
responsible employee of the recipient in legible form (it being agreed that the
burden of proving receipt will be on the sender and will not be met by a
transmission report generated by the sender's facsimile machine);

    

    (iv) if
sent by certified or registered mail (airmail, if overseas) or the equivalent
(return receipt requested), on the date that mail is delivered or its delivery
is attempted; or

    

    (v) if
sent by electronic messaging system, on the date that electronic message is
received,

    

    unless
the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.

    

    (b)           Change of
Addresses. Either party may by notice to the other change the address,
telex or facsimile number or electronic messaging system details at which
notices or other communications are to be given to it.

    

    13.           Governing
Law and Jurisdiction

    

    (a)           Governing
Law. This Agreement will be governed by and construed in accordance with
the law specified in the Schedule.

    

    (b)           Jurisdiction.
With respect to any suit, action or proceedings relating to this Agreement
("Proceedings"), each party irrevocably:

    

    (i)
submits to the jurisdiction of the English courts, if this Agreement is
expressed to be governed by English law, or to the non-exclusive jurisdiction of
the courts of the State of New York and the United States District Court located
in the Borough of Manhattan in New York City, if this Agreement is expressed to
be governed by the laws of the State of New York; and

    

    (ii)
waives any objection which it may have at any time to the laying of venue of any
Proceedings brought in any such court, waives any claim that such Proceedings
have been brought in an inconvenient forum and further waives the right to
object, with respect to such Proceedings, that such court does not have any
jurisdiction over such party.

    

    Nothing
in this Agreement precludes either party from bringing Proceedings in any other
jurisdiction (outside, if this Agreement is expressed to be governed by English
law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Act 1982 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.

    

    (c)           Service of
Process. Each party irrevocably appoints the Process Agent (if any)
specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable to
the other party. The parties irrevocably consent to service of process given in
the manner provided for notices in Section 12. Nothing in this Agreement will
affect the right of either party to serve process in any other manner permitted
by law.

    

    (d)           Waiver of
Immunities. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and assets
(irrespective of their use or intended use), all immunity on the grounds of
sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any
court, (iii) relief by way of injunction, order for specific performance or for
recovery of property, (iv) attachment of its assets (whether before or after
judgment) and (v) execution or enforcement of any judgment to which it or its
revenues or assets might otherwise be entitled in any Proceedings in the courts
of any jurisdiction and irrevocably agrees, to the extent permitted by
applicable law, that it will not claim any such immunity in any
Proceedings.

     

    
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14.           Definitions

    

    As used
in this Agreement:

    

    "Additional
Termination Event" has the meaning specified in Section
5(b).

    

    "Affected
Party" has the meaning specified in Section 5(b).

    

    "Affected
Transactions" means (a) with respect to any Termination Event consisting
of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected
by the occurrence of such Termination Event and (b) with respect to any other
Termination Event, all Transactions.

    

    "Affiliate"
means, subject to the Schedule, in relation to any person, any entity
controlled, directly or indirectly, by the person, any entity that controls,
directly or indirectly, the person or any entity directly or indirectly under
common control with the person. For this purpose, "control" of any entity or
person means ownership of a majority of the voting power of the entity or
person.

    

    "Applicable
Rate" means:

    

    (a)           in
respect of obligations payable or deliverable (or which would have been but for
Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

    

    (b)           in
respect of an obligation to pay an amount under Section 6(e) of either party
from and after the date (determined in accordance with Section 6(d)(ii)) on
which that amount is payable, the Default Rate;

    

    (c)           in
respect of all other obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate;
and

    

    (d)           in
all other cases, the Termination Rate.

    

    "Burdened
Party" has the meaning specified in Section 5(b).

    

    "Change in Tax
Law" means the enactment, promulgation, execution or ratification of, or
any change in or amendment to, any law (or in the application or official
interpretation of any law) that occurs on or after the date on which the
relevant Transaction is entered into.

    

    "consent"
includes a consent, approval, action, authorization, exemption, notice, filing,
registration or exchange control consent.

    

    "Credit Event
Upon Merger" has the meaning specified in Section 5(b).

    

    "Credit Support
Document" means any agreement or instrument that is specified as such in
this Agreement.

    

    "Credit Support
Provider" has the meaning specified in the Schedule.

    

    "Default
Rate" means a rate per annum equal to the cost (without proof or evidence
of any actual cost) to the relevant payee (as certified by it) if it were to
fund or of funding the relevant amount plus 1% per annum.

    

    "Defaulting
Party" has the meaning specified in Section 6(a).

    

    "Early
Termination Date" means the date determined in accordance with Section
6(a) or 6(b)(iv).

    

    "Event of
Default" has the meaning specified in Section 5(a) and, if applicable, in
the Schedule.

    

    "Illegality"
has the meaning specified in Section 5(b).

     

    
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    "Indemnifiable
Tax" means any Tax other than a Tax that would not be imposed in respect
of a payment under this Agreement but for a present or former connection between
the jurisdiction of the government or taxation authority imposing such Tax and
the recipient of such payment or a person related to such recipient (including,
without limitation, a connection arising from such recipient or related person
being or having been a citizen or resident of such jurisdiction, or being or
having been organized, present or engaged in a trade or business in such
jurisdiction, or having or having had a permanent establishment or fixed place
of business in such jurisdiction, but excluding a connection arising solely from
such recipient or related person having executed, delivered, performed its
obligations or received a payment under, or enforced, this Agreement or a Credit
Support Document).

    

    "law"
includes any treaty, law, rule or regulation (as modified, in the case of tax
matters, by the practice of any relevant governmental revenue authority) and
"lawful" and "unlawful" will be construed accordingly.

    

    "Local Business
Day" means, subject to the Schedule, a day on which commercial banks are
open for business (including dealings in foreign exchange and foreign currency
deposits) (a) in relation to any obligation under Section 2(a)(i), in the
place(s) specified in the relevant Confirmation or, if not so specified, by
reference, in this Agreement, (b) in relation to any other payment, in the place
where the relevant account is located and, if different, in the principal
financial center, if any, of the currency of such payment, (c) in relation to
any notice or other communication, including notice contemplated under Section
5(a)(i), in the city specified in the address for notice provided by the
recipient and, in the case of a notice contemplated by Section 2(b), in the
place where the relevant new account is to be located and (d) in relation to
Section 5(a)(v)(2), in the relevant locations for performance with respect to
such Specified Transaction.

    

    "Loss" means, with respect to
this Agreement or one or more Terminated Transactions, as the case may be, and a
party, the Termination Currency Equivalent of an amount that party reasonably
determines in good faith to be its total losses and costs (or gain, in which
case expressed as a negative number) in connection with this Agreement or that
Terminated Transaction or group of Terminated Transactions, as the case may be,
including any loss of bargain, cost of funding or, at the election of such party
but without duplication, loss or cost incurred as a result of its terminating,
liquidating, obtaining or reestablishing any hedge or related trading position
(or any gain resulting from any of them). Loss includes losses and costs (or
gains) in respect of any payment or delivery required to have been made
(assuming satisfaction of each applicable condition precedent) on or before the
relevant Early Termination Date and not made, except, so as to avoid
duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does
not include a party’s legal fees and out-of-pocket expenses referred to under
Section 11. A party will determine its Loss as of the relevant Early Termination
Date, or, if that is not reasonably practicable, as of the earliest date
thereafter as is reasonably practicable. A party may (but need not) determine
its Loss by reference to quotations of relevant rates or prices from one or more
leading dealers in the relevant markets.

    

    “Market
Quotation” means, with respect to one or more Terminated Transactions and
a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or by
such party (expressed as a positive number) in consideration of an agreement
between such party (taking into account any existing Credit Support Document
with respect to the obligations of such party) and the quoting Reference
Market-maker to enter into a transaction (the “Replacement Transaction”) that
would have the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition precedent)
by the parties under Section 2(a)(i) in respect of such Terminated Transaction
or group of Terminated Transactions that would, but for the occurrence of the
relevant Early Termination Date, have been required after that date. For this
purpose, Unpaid Amounts in respect of the Terminated Transaction or group of
Terminated Transactions are to be excluded but, without limitation, any payment
or delivery that would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable conditions precedent) after
that Early Termination Date is to be included. The Replacement Transaction would
be subject to such documentation as such party and the Reference Market-maker
may, in good faith, agree. The party making the determination (or its agent)
will request each Reference Market-maker to provide its quotation to the extent
reasonably practicable as of the same day and time (without regard to different
time zones) on or as soon as reasonably practicable after the relevant Early
Termination Date. The day and time as of which those quotations are to be
obtained will be selected in good faith by the party obliged to make a
determination under Section 6(e), and, if each party is so obliged, after
consultation with the other. If more than three quotations are provided, the
Market Quotation will be the arithmetic mean of the quotations, without regard
to the quotations having the highest and lowest values. If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations. For this purpose, if more
than one quotation has the same highest value or lowest value, then one of such
quotations shall be disregarded.  If fewer than three quotations are
provided, it will be deemed that the Market Quotation in respect of such
Terminated Transaction or group of Terminated Transactions cannot be
determined.

     

    
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“Non-default
Rate” means a rate per annum equal to the cost (without proof or evidence
of any actual cost) to the Non-defaulting Party (as certified by it) if it were
to fund the relevant amount.

    

    “Non-defaulting
Party” has the meaning specified in Section 6(a).

    

    “Office”
means a branch or office of a party, which may be such party’s head or home
office.

    

    “Potential Event
of Default” means any event which, with the giving of notice or the lapse
of time or both, would constitute an Event of Default.

    

    “Reference
Market-makers” means four leading dealers in the relevant market selected
by the party determining a Market Quotation in good faith (a) from among dealers
of the highest credit standing which satisfy all the criteria that such party
applies generally at the time in deciding whether to offer or to make an
extension of credit and (b) to the extent practicable, from among such dealers
having an office in the same city.

    

    “Relevant
Jurisdiction” means, with respect to a party, the jurisdictions (a) in
which the party is incorporated, organized, managed and controlled or considered
to have its seat, (b) where an Office through which the party is acting for
purposes of this Agreement is located, (c) in which the party executes this
Agreement and (d) in relation to any payment, from or through which such payment
is made.

    

    "Schedule Payment
Date" means a date on which a payment or delivery is to be made under
Section 2(a)(i) with respect to a Transaction.

    

    "Set-off"
means set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or imposed
on, such payer.

    

    "Settlement
Amount" means, with respect to a party and any Early Termination Date,
the sum of:

    

    (a)           the
Termination Currency Equivalent of the Market Quotations (whether positive or
negative) for each Terminated Transaction or group of Terminated Transactions
for which a Market Quotation is determined; and

    

    (b)           such
party's Loss (whether positive or negative and without reference to any Unpaid
Amounts) for each Terminated Transaction or group of Terminated Transactions for
which a Market Quotation cannot be determined or would not (in the reasonable
belief of the party making the determination) produce a commercially reasonable
result.

    

    "Specified
Entity" has the meaning specified in the Schedule.

    

    "Specified
Indebtedness" means, subject to the Schedule, any obligation (whether
present or future, contingent or otherwise, as principal or surety or otherwise)
in respect of money borrowed by Party A or by Party B or any Specified Entities
or Credit Support Providers of each such parties.

    

    "Specified
Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter entered
into between one party to this Agreement (or any Credit Support Provider of such
party or any applicable Specified Entity of such party) and the other party to
this Agreement (or any Credit Support Provider of such other party or any
applicable Specified Entity of such other party) which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions), (b) any combination of
these transactions and (c) any other transaction identified as a Specified
Transaction in this Agreement or the relevant confirmation.

     

    
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"Stamp
Tax" means any stamp, registration, documentation or similar
tax.

    

    "Tax"
means any present or future tax, levy, impost, duty, charge, assessment or fee
of any nature (including interest, penalties and additions thereto) that is
imposed by any government or other taxing authority in respect of any payment
under this Agreement other than a stamp, registration, documentation or similar
tax.

    

    "Tax
Event" has the meaning specified in Section 5(b).

    

    "Tax Event Upon
Merger" has the meaning specified in Section 5(b).

    

    "Terminated
Transactions" means with respect to any Early Termination Date (a) if
resulting from a Termination Event, all Affected Transaction and (b) if
resulting from an Event of Default, all Transactions (in either case) in effect
immediately before the effectiveness of the notice designating that Early
Termination Date (or, if "Automatic Early Termination" applies, immediately
before that Early Termination Date).

    

    "Termination
Currency" has the meaning specified in the Schedule.

    

    "Termination
Currency Equivalent" means, in respect of any amount denominated in the
Termination Currency, such Termination Currency amount and, in respect of any
amount denominated in a currency other than the Termination Currency (the "Other
Currency"), the amount in the Termination Currency determined by the party
making the relevant determination as being required to purchase such amount of
such Other Currency as at the relevant Early Termination Date, or, if the
relevant Market Quotation or Loss (as the case may be), is determined as of a
later date, that later date, with the Termination Currency at the rate equal to
the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a rate
for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the
parties.

    

    "Termination
Event" means an Illegality, a Tax Event or a Tax Event Upon Merger or, if
specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.

    

    “Termination
Rate" means a rate per annum equal to the arithmetic mean of the cost
(without proof or evidence of any actual cost) to each party (as certified by
such party) if it were to fund or of funding such amounts.

    

    "Unpaid
Amounts" owing to any party means, with respect to an Early Termination
Date, the aggregate of (a) in respect of all Terminated Transactions, the
amounts that became payable (or that would have become payable but for Section
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early
Termination Date and which remain unpaid as at such Early Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market value of that which was (or would have been) required to be
delivered as of the originally scheduled date for delivery, in each case
together with (to the extent permitted under applicable law) interest, in the
currency of such amounts, from (and including) the date such amounts or
obligations were or would have been required to have been paid or performed to
(but excluding) such Early Termination Date, at the Applicable Rate. Such
amounts of interest will be calculated on the basis of daily compounding and the
actual number of days elapsed. The fair market value of any obligation referred
to in clause (b) above shall be reasonably determined by the party obliged to
make the determination under Section 6(e) or, if each party is so obliged, it
shall be the average of the Termination Currency Equivalents of the fair market
values reasonably determined by both parties.

     

    
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IN
WITNESS WHEREOF the parties have executed this document on the respective dates
specified below with effect from the date specified on the first page of this
document.

    

    
      	
              PARTY
      A:

            	 	
              PARTY
      B:

            	 
      
	 
      	 
      	 	 
      	 
      	 
      
	
              COLONIAL
      AUTO FINANCE, INC., AN

            	 	 
      	 
      	 
      
	
              ARKANSAS
      CORPORATION.

            	 	

              BANK
      OF OKLAHOMA, N.A.

            	 
      
	 
      	 
      	 	 
      	 
      	 
      
	
              By

            	
              /s/ T.J Falgout III

            	 	
              By:

            	
              /s/ Jim Huntzinger

            	 
      
	 
      	 
      	 	 
      	 
      	 
      
	 
      	
              Name:
      T.J. Falgout, III

            	 	 
      	
              Name:
      Jim Huntzinger

            	 
      
	 
      	 
      	 	 
      	 
      	 
      
	 
      	
              Title:
      President

            	 	 
      	
              Title:
      Chief Investment Officer

            	 
      
	 
      	 
      	 	 
      	 
      	 
      
	 
      	
              Date:
      May 16,
      2008

            	 	 
      	
              Date:  May 16,
      2008

            	 
      

    

    

    AMERICA’S
CAR-MART, INC., A TEXAS

    CORPORATION,
FORMERLY KNOWN AS

    CROWN
GROUP, INC.

    

    
      	
              By:

            	
              /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Title:
      Vice President

            	 
      
	 
      	 
      	 
      
	 
      	
              Date:
      May 16,
      2008

            	 
      

    

    

    AMERICA’S
CAR-MART, INC., AN

    ARKANSAS
CORPORATION

    

    
      	
              By:

            	
              /s/ Jeff Wiliams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Title:
      Vice President

            	 
      
	 
      	 
      	 
      
	 
      	
              Date:
      May 16,
      2008

            	 
      

    

    
 

    TEXAS
CAR-MART, INC., A TEXAS

    CORPORATION

     

    
      	
              By:

            	
              /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Title:
      Vice President

            	 
      
	 
      	 
      	 
      
	 
      	
              Date:  May 16,
      2008

            	 
      

    

     

    
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    SCHEDULE

    to
the

    Master
Agreement

    

    dated as
of 15 May 2008

    

    between

    

    AMERICA’S CAR-MART, INC., AN
ARKANSAS CORPORATION AND TEXAS CAR-MART,

    INC., A TEXAS CORPORATION,
(2.) COLONIAL AUTO FINANCE, INC., AN ARKANSAS

    CORPORATION. ("Party
A")

    

    and

    

    BANK OF OKLAHOMA,
N.A. (“Party B”)

    

    

    Part
I

    

    Termination
Provisions

    

    In this
Agreement: -

    

    1.         
   "Specified
Entity" means in relation to Party A for the purposes of:

    

    
      	 
      	
              Section
      5(a)(v), Not Applicable

            	 
      
	 
      	
              Section
      5(a)(vi), Not Applicable

            	 
      
	 
      	
              Section
      5(a)(vii), Not Applicable

            	 
      
	 
      	
              Section
      5(b)(iv), Not Applicable

            	 
      
	 
      	 
      	 
      
	 
      	
              in
      relation to Party B for the purpose of:

            	 
      
	 
      	 
      	 
      
	 
      	
              Section
      5(a)(v), Not Applicable

            	 
      
	 
      	
              Section
      5(a)(vi), Not Applicable

            	 
      
	 
      	
              Section
      5(a)(vii), Not Applicable

            	 
      
	 
      	
              Section
      5(b)(iv), Not Applicable

            	 
      

    

    

    2.      
     "Specified Transaction" means,
in lieu of the meaning specified in Section 14, any contract or transaction,
including an agreement with respect thereto (whether or not documented under or
effected pursuant to a master agreement) now existing or hereafter entered into
between one party to this Agreement (or any Credit Support Provider of such
party or any applicable Specified Entity of such party) and the other party to
this Agreement (or any Credit Support Provider of such party or any applicable
Specified Entity of such party).

    

    3.           
 The "Cross
Default" provisions of Section 5(a)(vi) will apply to Party A and will
apply to Party B or any Affiliate(s) of Party B.

    

    In
connection therewith, "Specified Indebtedness" will
have the meaning specified in Section 14 but it will not include indebtedness in
respect of deposits received or any payment obligation not made because of any
event similar to Illegality.

    

    "Threshold Amount" means with
respect to Party B an amount equal to three percent (3%) of shareholders’ equity
and with respect to Party A, zero.

    

    4.           "Termination Currency" means
United States Dollars.

    

    5.         
  The "Credit Event
Upon Merger" provisions of Section 5(b)(iv) will apply to Party A and
will apply to Party B.

     

    
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    6.            
The "Automatic Early
Termination" provisions of Section 6(a) will not apply to Party A and
will not apply to Party B.

    

    7.         
   Payments on
Early Termination. For the purposes of Section 6(e) of this Agreement:
-

    

    (a)  Loss
will apply to this Agreement; and

    

    (b)  The
Second Method will apply to this Agreement.

    

    8.         
   Additional
Termination Event: The following shall constitute an Additional
Termination Event with respect to Party A, which shall be the Affected
Party:

    

    (i)  Party
B or any Affiliate(s) of Party B reduces the amount of credit available to Party
A under the credit facility made available to Party A pursuant to the Credit
Agreement (as defined herein), or

    

    (ii)  Party
B or any Affiliate(s) of Party B cease to be a “Lender” under the Credit
Agreement (as defined herein) , or

    

    (iii)  The
Credit Agreement (as defined herein) expires or is terminated as a result of
repayment in full of all obligations on the part of Party A under the Credit
Agreement, or

    

    (iv)  Party
A at any time does not meet any settlement amounts or posting of eligible
collateral under transactions covered by this agreement, or

    

    (v)  Party
A at any time undergoes a material adverse change in its business, operations,
financial condition, assets or properties affecting its ability to perform all
of its outstanding financial obligations under this Agreement, under any
Transaction or otherwise, or

    

    (vi)  Any
indebtedness of Party A to Party B or any Affiliate(s) of Party B at any time is
rated below grade-6 in accordance with usual and customary credit rating system
of Party B or any Affiliate(s) of Party B.

    

    Part
II

    

    Tax
Representations

    

    (a)  Payer Representation. For the
purpose of Section 3(e) of this Agreement, Party A will make the following
representation and Party B will make the following representation:
-

    

    It is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(c), 6(d)(ii) or 6(e) of this Agreement) to be made
by it to the other party under this Agreement. In making this representation, it
may rely on (i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement, (ii) the satisfaction of the
agreement of the other party contained in Section 4(a)(i) or Section 4(a)(iii)
of this Agreement and the accuracy and effectiveness of any document provided by
the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and
(iii) the satisfaction of the agreement of the other party contained in Section
4(d) of this Agreement, provided that it shall not be a breach of this
representation where reliance is placed on clause (ii) and the other party does
not deliver a form or document under Section 4(a)(iii) by reason of material
prejudice to its legal or commercial position.

    

    (b)  Payee Representations: For the
purpose of Section 3(f) of this Agreement, Party A and Party B make the
following representations:

    

    Party A
represents that it is a operating under the laws of Arkansas.

     

    
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    Party B
represents that it is a national bank organized and existing under the laws of
the United States of America.

    

    Each
payment received or to be received by it in connection with this Agreement will
be effectively connected with its conduct of a trade or business in the United
States.

    

    Part
III

    

    Agreement to Deliver
Documents

    

    For the
purposes of Sections 4(a)(i) and (ii), each party agrees to deliver the
following documents, as applicable:

    

    
      	
              Party
      Required to

              Deliver
      Document

            	 	 	
              Form/Document/

              Certificate

            	 	 	
              Date
      by which to

              be

              Delivered

            	 	 	
              Covered
      by Sec

              3(d)

              Representation

            
	
              Party
      A/Party B

               

            	 	 	
              Any
      document required or reasonably requested to allow the other party to make
      payments under the Agreement without any deduction or withholding for or
      on the account of any Tax.

            	 	 	
              Promptly
      after

              request

               

            	 	 	
              Yes

               

            
	
              Party
      A/Party B

               

            	 	 	
              Evidence
      of the authority and true signature of the signatories of this Agreement
      and each Confirmation on its behalf.

            	 	 	
              Upon
      execution of

              this
      Agreement

               

            	 	 	
              Yes

            
	
              Party
      A/Party B

               

            	 	 	
              A
      copy of the annual report of such party (in the case of Party A, in
      respect of Party A’s credit support provider) containing audited
      consolidated financial statements for each such fiscal year, certified by
      independent certified public accountants and prepared in accordance with
      generally accepted accounting principles in the country in which such
      party is organized, or such other financial statements as may be
      acceptable to Party B in its sole discretion reasonably
      exercised.

            	 	 	
              Upon
      execution of

              this
      Agreement

               

            	 	 	
              Yes

            
	
              Party
      A/Party B

            	 	 	
              Credit
      Support Document referenced in

              Part
      4 (5) of this Schedule.

            	 	 	
              Promptly
      after request during the term of this agreement

            	 	 	
              Yes

            

    

    

    

    Part
IV

    

    Miscellaneous

    

    1.          
  Governing
Law. This Agreement, including each Credit Support Document and each
confirmation will be governed by and construed in accordance with the laws of
the State of New York without reference to choice of law doctrine.

    

    2.        
    Notices.

    

    (a) In
connection with Section 12(a), all notices to Party A shall, with respect to any
particular Transaction, be sent to the address, telex number, or facsimile
number specified in the relevant Confirmation and any notice for purposes of
Sections 5 or 6 of the Agreement shall be sent to the address, telex number, or
facsimile number specified below:

     

    
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    Name:
JEFF WILLIAMS

    

    Address1:
802 S.E. PLAZA AVENUE, SUITE 200

    

    Address2:

    

    City:
BENTONVILLE, State: AR Zip Code: 72712

    

    Fax:
(479) 464-4234

    

    Attention:
JEFF WILLIAMS

    

    (b) In
connection with Section 12(a), all notices to Party B shall, with respect to any
particular Transaction, be sent to the address, telex number or facsimile number
specified in the relevant Confirmation and any notice for purposes of Sections 5
or 6 of the Agreement shall be sent to the address, telex number or facsimile
number specified below:

    

    Bank of
Oklahoma, N.A.

    Attn:
Brad Emmons, 15-NE

    P.O. Box
2300

    One
Williams Center

    Tulsa, OK
74192

    918-588-8238
(phone)

    918-588-6957
(fax)

    

    3.           
 Netting of
Payments. Subparagraph (ii) of Section 2(c) will not apply as set out in
this Agreement.

    

    4.        
    Multibranch Party. For the
purpose of Section 10:

    

    Party A
is not a Multibranch Party.

    

    Party B
is not a Multibranch Party.

    

    5.           
 Credit Support
Documents: Credit Support Documents means in relation to Party A and
Party B, the Credit Support Annex attached hereto and deemed to be a part of
this agreement, any Confirmation and any other document any of which by its
terms secures, guarantees or otherwise supports either or both parties’
obligations under this Agreement.

    

    6.           
 Credit Support
Provider: Credit Support Provider means in relation to Party A: AMERICA’S
CAR-MART, INC., a Texas corporation and in relation to Party B:
N/A.

    

    7.           
 Process Agent: For
the purpose of Section 13(c): -

    

    Party A
appoints as its Process Agent: Not applicable

    

    Party B
appoints as its Process Agent: Not applicable

    

    8.        
    Offices: The provisions of
Section 10(a) will apply to this Agreement.

    

    9.         
   Pari
Passu: Party A represents, warrants and covenants, (said representation
shall be covered by Section 3(d) of this Agreement), to Party B or any
Affiliate(s) of Party B that its obligations under this Agreement shall rank at
all times pari passu with any other senior secured or unsecured Specified
Indebtedness.

     

    
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Part
V

    

    Other
Provisions

    

    
      	
              1.

            	
              ISDA Definitions.
      Reference is hereby made to the 2000 ISDA Definitions (the “Definitions”),
      as published by the International Swaps and Derivatives Association, Inc.,
      which are hereby incorporated by reference herein. Any terms used and not
      otherwise defined herein which are contained in the Definitions shall have
      the meaning set forth therein.

            
	 
      	 
      
	
              2.

            	
              Inconsistency. In the
      event of any inconsistency between any of the following documents, the
      relevant document first listed below shall govern: (i) a Confirmation;
      (ii) the Schedule; (iii) the 2000 Definitions; and (iv) the printed form
      of ISDA Master Agreement.

            
	 
      	 
      
	
              3.

            	
              Setoff. Any amount (the
      "Early Termination Amount") payable to one party (the Payee) by the other
      party (the Payer) under Section 6(e), in circumstances where there is a
      Defaulting Party or one Affected Party in the case where a Termination
      Event under Section 5(b)(iv) or (v) has occurred, will, at the option of
      the party ("X") other than the Defaulting Party or the Affected Party (and
      without prior notice to the Defaulting Party or the Affected Party), be
      reduced by its set-off against any amount(s) (the "Other Agreement
      Amount") payable (whether at such time or in the future or upon the
      occurrence of a contingency) by the Payee to the Payer (irrespective of
      the currency, place of payment or booking office of the obligation) under
      any other agreement(s) between the Payee and the Payer or instrument(s) or
      undertaking(s) issued or executed by one party to, or in favor of, the
      other party (and the Other Agreement Amount will be discharged promptly
      and in all respects to the extent it is so set-off). X will give notice to
      the other party of any set-off effected under this Part
    5(a).

            
	 
      	 
      
	 
      	
              For
      this purpose, either the Early Termination Amount or the Other Agreement
      Amount (or the portion of such amounts) may be converted by X into the
      currency in which the other is denominated at the rate of exchange at
      which such party would be able, acting in a reasonable manner and in good
      faith, to purchase the relevant amount of such
currency.

            
	 
      	 
      
	 
      	
              If
      an obligation is unascertained, X may in good faith estimate that
      obligation and set-off in respect of the estimate, subject to the relevant
      party accounting to the other when the obligation is
      ascertained.

            
	 
      	 
      
	 
      	
              Nothing
      in this Part 5(a) shall be effective to create a charge or other security
      interest. This Part 5(a) shall be without prejudice and in addition to any
      right of set-off, combination of accounts, lien or other right to which
      any party is at any time otherwise entitled (whether by operation of law,
      contract or otherwise).

            
	 
      	 
      
	
              4.

            	
              Calculation Agent. The
      Calculation Agent will be Party B unless otherwise specified in a
      Confirmation in relation to the relevant Transaction.

            
	 
      	 
      
	
              5.

            	
              Waiver of Right to Trial by
      Jury. Party B and Party A hereby irrevocably waive any and all
      rights to trial by jury with respect to any legal proceeding arising out
      of or relating to this Agreement or any Transaction contemplated
      hereby.

            
	 
      	 
      
	
              6.

            	
              Application of Events of
      Default for Fully Paid Transactions. Notwithstanding the terms of
      Sections 5(a) of this Agreement, none of the events set forth in Section
      5(a) shall constitute an Event of Default with respect to Party A if and
      for as long as there shall be no outstanding obligations, whether absolute
      or contingent, of Party A under Section 2(a)(i) of this
      Agreement.

            
	 
      	 
      
	
              7.

            	
              Consent to Recording.
      The parties agree that each may electronically record all telephonic
      conversations between them and that any such recordings may be submitted
      in evidence to any court or in any Proceedings for the purpose of
      establishing any matters pertinent to any Transaction.

            
	 
      	 
      
	
              8.

            	
              Additional
      Representations. Section 3 is hereby amended by adding at the end
      thereof the following
Subparagraphs:

            

    

     

    
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              (g)    Eligible Swap
      Participant. It is an “eligible swap participant” within the
      meaning of Part 35.1(b)(2) of the General Regulations under the Commodity
      Exchange Act.

            
	 
      	 
      
	 
      	
              (h)    Relationship Between
      Parties.

            
	 
      	 
      
	 
      	
              (i)    Non-Reliance. It is
      acting for its own account, and it has made its own independent decisions
      to enter into that Transaction and as to whether that Transaction is
      appropriate or proper for it based upon its own judgment and upon advice
      from such advisors as it has deemed necessary. It is not relying on any
      communication (written or oral) of the other party as investment advice or
      as a recommendation to enter into that Transaction; it being understood
      that information and explanations related to the terms and conditions of a
      Transaction shall not be considered investment advice or a recommendation
      to enter into that Transaction. It has not received from the other party
      any assurance or guarantee as to the expected results of the
      Transaction.

            
	 
      	 
      
	 
      	
              (ii)    Evaluation and
      Understanding. It is capable of evaluation and understanding (on
      its own behalf or through independent professional advice), and
      understands and accepts, the terms, conditions and risks of that
      Transaction. It is also capable of assuming and assumes the financial and
      other risks of the Transaction.

            
	 
      	 
      
	 
      	
              (iii)    Status of the Parties.
      The other party is not acting as a fiduciary or an advisor for it in
      respect of that Transaction.

            
	 
      	 
      
	 
      	
              (i)    Principal. It is
      entering into this Agreement and such other documentation as principal,
      and not as agent or in any other capacity, fiduciary or
      otherwise.

            
	 
      	 
      
	
              9.

            	
              Severability. If any
      term, provision, covenant, or condition of this Agreement, or the
      application thereof to any party or circumstance, shall be held to be
      invalid or unenforceable (in whole or in part) for any reason, the
      remaining terms, provisions, covenants, and conditions hereof shall
      continue in full force and effect as if the Agreement had been executed
      with the invalid or unenforceable portion eliminated so long as this
      Agreement as so modified continues to express, without material change,
      the original intentions of the parties as to the subject matter of this
      Agreement and the deletion of such portion of this Agreement will not
      substantially impair the respective benefits or expectations of the
      parties.

            
	 
      	 
      
	 
      	
              The
      parties shall endeavor to engage in good faith negotiations to replace any
      invalid or unenforceable term, provision, covenant or condition with a
      valid or enforceable term, provision or covenant or condition, the
      economic effect of which comes as close as possible to that of the invalid
      or unenforceable term, provision, covenant or
condition.

            
	 
      	 
      
	
              10.

            	
              Confidentiality. Each
      party hereby agrees that it shall not disclose to any third parties any
      proprietary financial information regarding the other party without the
      prior written consent of the other party other than (i) information that
      is or becomes a matter of general public knowledge other than as a result
      of disclosure by the other party, (ii) any information that is already in
      the other party’s possession provided that the source of such information
      was not to the knowledge of the disclosing party obligated to keep such
      information confidential and (iii) any information that is legally
      required to be disclosed or is otherwise subject to legal, judicial,
      regulatory or self-regulatory requests for information or
      documents.

            
	 
      	 
      
	
              11.

            	
              “Credit
      Agreement” means the Amended and Restated Loan Agreement dated as of June
      23, 2005, by and between Bank of Arkansas, N.A.,
      a national banking association or one if its affiliates and AMERICA’S
      CAR-MART, INC., AN ARKANSAS CORPORATION AND TEXAS CAR-MART, INC., A TEXAS
      CORPORATION, (2.) COLONIAL AUTO FINANCE, INC., AN ARKANSAS CORPORATION.
      a(n) , as amended, supplemented, restated or replaced from time to time
      (but without giving effect to any amendments, supplements, restatements or
      replacements thereto, or any waivers or consents granted thereunder, not
      consented to in writing by Party B or any Affiliate(s) of Party
      B).

            
	 
      	 
      
	
              12.

            	
              Setoff Upon Termination.
      In the event (i) an interest rate derivative entered into under this ISDA
      agreement is terminated for any reason and an amount is owed to Party A by
      Party B or any Affiliate(s) of Party B, (ii) Party A is indebted to Party
      B or any Affiliate(s) of Party B for borrowed monies, and (iii) the
      obligation of Party A to repay Party B or any Affiliate(s) of Party B for
      such borrowed monies, is graded 7 or below under Party B or any
      Affiliate(s) of Party B 's credit scoring system at the time of such
      termination, Party B or any Affiliate(s) of Party B may offset the amount
      due under this ISDA agreement against such indebtedness for borrowed
      monies which setoff shall be applied first to unrecovered collection
      costs, second to interest, and third to
  principal.

            

    

     

    
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              13.

            	
              Additional Event of
      Default. In addition to the Events of Default contained in Section
      5 of this Agreement, it shall be an Event of Default hereunder, with Party
      A as the Defaulting Party, if a default, event of default or other similar
      condition or event (however described) shall have occurred under the
      Credit Agreement, whether or not the Credit Agreement remains in effect at
      such time, and without giving effect to any requirement contained in the
      Credit Agreement that notice of the relevant circumstances be provided by
      any party, but only requiring that any such notice be provided by Party A
      to Party B.

            
	 
      	 
      
	
              14.

            	
              Additional Covenants and
      Agreements. In addition to the covenants and agreements contained
      in Section 4 of this Agreement, Party A agrees to observe, perform and
      comply with all of the covenants and agreements on its part set forth in
      the Credit Agreement, whether or not the Credit Agreement remains in
      effect at such time, and such covenants and agreements will be deemed to
      continue in effect for the benefit of Party B or any Affiliate(s) of Party
      B whether or not any commitment remains in effect, or any sum remains
      payable under the Credit Agreement, provided that any documentation to be
      delivered to any lender under the Credit Agreement shall be concurrently
      delivered to Party B.

            
	 
      	 
      
	
              15.

            	
              Conflict or Inconsistency with
      the Credit Agreement. Insofar as any provisions of the Credit
      Agreement incorporated herein conflict with or are inconsistent with any
      terms, covenants, or conditions in this Agreement, including without
      limitation Events of Default, covenants and agreements and any other
      related provisions of this Agreement, then the provisions of this
      Agreement shall govern to the extent of the conflict or inconsistency,
      provided that the non-inclusion of a provision in either document shall
      not constitute a conflict or inconsistency for the purposes of this
      provision.

            
	 
      	 
      
	
              16.

            	
              Collateral Security.
      Party A agrees that all of its obligations under this Agreement (whether
      present, future, contingent or otherwise) shall be secured by any
      collateral security from time to time granted by Party A to Party B or any
      Affiliate(s) of Party B (whether before or after the date hereof)
      including, without limitation, all security provided in respect of Party
      A's obligations under the Credit Agreement. Party A undertakes to and
      agrees with Party B to enter into, execute and deliver all such additional
      agreements, documents, instruments and other assurances and to do such
      acts and things as Party B may require in order to effect the
      foregoing.

            
	 
      	 
      
	
              17.

            	
              Form of Confirmation.
      Any Confirmation exchanged between the parties shall be substantially in
      the form of the Exhibits to the Definitions. Any Confirmation identifying
      a derivative transaction between the parties will be deemed to supplement,
      form a part of, and be subject to this Agreement, unless such Confirmation
      shall expressly state otherwise. Where a Transaction is confirmed by means
      of an electronic messaging system that the parties have elected to use to
      confirm such Transaction or if the Transaction is of the type specified in
      the definition of Specified Transactions confirmed by means other than by
      an electronic messaging system (i) such confirmation will constitute a
      “Confirmation” as referred to in this Agreement even where not so
      specified in the confirmation, (ii) such Confirmation will supplement,
      form a part of, and be subject to this Agreement (unless such Confirmation
      shall expressly state otherwise) and all provisions in this Agreement will
      govern the Confirmation except as modified therein.

            
	 
      	 
      
	
              18.

            	
              Transfer: Section 7 of
      the Agreement is hereby amended by adding the following in the third line
      between the word “party” and the comma: “which will not be unreasonably
      withheld or delayed, provided further that such proposed transferee is an
      entity with which Party B or any affiliates of Party B has then existing
      credit lines.”

            
	 
      	 
      
	
              19.

            	
              Condition Precedent to Payments
      to the Defaulting Party. All obligations of a Non-defaulting Party
      (“X”) and any Affiliate of X under this Agreement, any Specified
      Transaction with the other party (“Y”) or in respect of any other matured,
      liquidated or terminated obligation to Y are subject to the condition
      precedent that Y shall have performed all its obligations to X and any
      Affiliate of X under this Agreement, any Specified Transaction with X and
      in respect of any other matured, liquidated or terminated obligation of Y,
      whether or not contingent and regardless of the currency, place of payment
      or booking office of the
obligation.

            

    

     

    
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              20.

            	
              Right to Terminate Specified
      Transactions. The occurrence or designation of an Early termination
      Date on account of an Event of Default or Additional Termination Event
      with respect to a party hereto (“Y”) shall constitute a material breach
      and event of default (howsoever described) under all Specified
      Transactions to which Y is a party, whereupon the Non-defaulting Party
      (“X”) or any Affiliate of X shall have the right to terminate, liquidate
      and otherwise close out any such Specified Transactions (and Y shall be
      liable for any damages suffered by X and any Affiliate of X as a result
      thereof).

            
	 
      	 
      
	
              21.

            	
              Scope of Agreement. This
      Agreement and the related Credit Support Annex shall apply to and govern
      only transactions between Party A and Party B that are interest rate
      derivative transactions. In addition, no other Agreement or associated
      Credit Support Annex between Party A and Party B shall apply to or govern
      transactions between Party A and Party B that are interest rate derivative
      transactions.

            
	 
      	 
      
	
              22.

            	
              "Affiliate(s)" shall
      mean one or more of the following with respect to Party B: Bank of
      Albuquerque, N.A., Bank of Texas, N.A., Bank of Arkansas, N.A., Colorado
      State Bank and Trust, N.A.

            

    

    
 

    
      	PARTY A:	 	PARTY B:	 
	 	 	 	 	 	 
	
              COLONIAL
      AUTO FINANCE, INC., AN

              ARKANSAS
      CORPORATION.

            	BANK OF OKLAHOMA,
      N.A.	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	
              By:

            	
              /s/ T.J Falgout

            	 
      	
              By:

            	
              /s/ Jim Huntzinger

            	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
              Name:
      T.J. Falgout, III

            	 
      	 
      	
              Name:
      Jim Huntzinger

            	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
              Title:
      President

            	 
      	 
      	
              Title:
      Chief Investment Officer

            	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
              Date:
      May 16,
      2008

            	 
      	 
      	
              Date:
      May 16,
      2008

            	 
      

    

    

    AMERICA’S
CAR-MART, INC., A TEXAS

    CORPORATION,
FORMERLY KNOWN AS

    CROWN
GROUP, INC.

    

    
      	
              By:

            	
              /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Title:
      Vice President

            	 
      
	 
      	 
      	 
      
	 
      	
              Date:
      May 16,
      2008

            	 
      

    

    

    

    AMERICA’S
CAR-MART, INC., AN

    ARKANSAS
CORPORATION

    

    

    
      	
              By:

            	
               /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Title:
      Vice President

            	 
      
	 
      	 
      	 
      
	 
      	
              Date:
      May 16,
    2008

            	 
      

    

     

    
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TEXAS
CAR-MART, INC., A TEXAS

    CORPORATION

    

    
      	 
      	
              Name:
      Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Title:
      Vice President

            	 
      
	 
      	 
      	 
      
	 
      	
              Date:
      May 16, 2008

            	 
      

    

     

     

     

    
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    (Bilateral
Form) (ISDA Agreements subject to New York Law Only)

    

    ISDA®

    International
Swap Dealers Association, Inc.

    

    CREDIT
SUPPORT ANNEX

    To the
Schedule to the Master Agreement

    

    dated as
of 15 May 2008

    

    between

    

    AMERICA’S CAR-MART, INC., AN
ARKANSAS CORPORATION AND TEXAS CAR-MART,

    INC., A TEXAS CORPORATION,
(2.) COLONIAL AUTO FINANCE, INC., AN ARKANSAS

    CORPORATION.

    

    (“Party
A”)

    

    and

    

    BANK OF OKLAHOMA,
N.A.

    

    (“Party
B”)

    

    

    This
Annex supplements, forms part of, and is subject to, the above-referenced
Agreement, is part of its Schedule and is a Credit Support Document under this
Agreement with respect to each party.

    

    Accordingly,
the parties agree as follows:—

    

    Paragraph
1.    Interpretation

    

    (a)           Definitions and
Inconsistency. Capitalized terms not otherwise defined herein or
elsewhere in this Agreement have the meanings specified pursuant to Paragraph
12, and all references in this Annex to Paragraphs are to Paragraphs of this
Annex. In the event of any inconsistency between this Annex and the other
provisions of this Schedule, this Annex will prevail, and in the event of any
inconsistency between Paragraph 13 and the other provisions of this Annex,
Paragraph 13 will prevail.

    

    (b)           Secured Party and
Pledgor. All references in this Annex to the “Secured Party” will be to
either party when acting in that capacity and all corresponding references to
the “Pledgor” will be to the other party when acting in that capacity; provided,
however, that if Other Posted Support is held by a party to this Annex, all
references herein to that party as the Secured Party with respect to that Other
Posted Support will be to that party as the beneficiary thereof and will not
subject that support or that party as the beneficiary thereof to provisions of
law generally relating to security interests and secured parties.

    

    Paragraph
2.    Security
Interest

    

    Each
party, as the Pledgor, hereby pledges to the other party, as the Secured Party,
as security for its Obligations, and grants to the Secured Party a first
priority continuing security interest in, lien on and right of Set-off against
all Posted Collateral Transferred to or received by the Secured Party hereunder.
Upon the Transfer by the Secured Party to the Pledgor of Posted Collateral, the
security interest and lien granted hereunder on that Posted Collateral will be
released immediately and, to the extent possible, without any further action by
either party.

     

    

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    Paragraph
3.    Credit Support
Obligations

    

    (a)           Delivery
Amount. Subject to Paragraphs 4 and 5, upon a demand made by the Secured
Party on or promptly following a Valuation Date, if the Delivery Amount for that
Valuation Date equals or exceeds the Pledgor’s Minimum Transfer Amount, then the
Pledgor will Transfer to the Secured Party Eligible Credit Support having a
Value as of the date of Transfer at least equal to the applicable Delivery
Amount (rounded pursuant to Paragraph 13). Unless otherwise specified in
Paragraph 13, the “Delivery Amount” applicable to the Pledgor for any Valuation
Date will equal the amount by which:

    

    (i)            
the Credit Support Amount

    

               exceeds

    

    (ii)         
  the Value as of that Valuation Date of all Posted Credit Support
held by the Secured Party.

    

    (b)           Return
Amount. Subject to Paragraphs 4 and 5, upon a demand made by the Pledgor
on or promptly following a Valuation Date, if the Return Amount for that
Valuation Date equals or exceeds the Secured Party’s Minimum Transfer Amount,
then the Secured Party will Transfer to the Pledgor Posted Credit Support
specified by the Pledgor in that demand having a Value as of the date of
Transfer as close as practicable to the applicable Return Amount (rounded
pursuant to Paragraph 13). Unless otherwise specified in Paragraph 13, the
“Return Amount” applicable to the Secured Party for any Valuation Date will
equal the amount by which:

    

    (i)         
   the Value as of that Valuation Date of all Posted Credit
Support held by the Secured Party

    

    exceeds

    

    (ii)            the
Credit Support Amount.

    

    “Credit Support
Amount” means, unless otherwise specified in Paragraph 13, for any
Valuation Date (i) the Secured Party’s Exposure for that Valuation Date plus
(ii) the aggregate of all Independent Amounts applicable to the Pledgor, if any,
minus (iii) all Independent Amounts applicable to the Secured Party, if any,
minus (iv) the Pledgor’s Threshold; provided, however, that the Credit Support
Amount will be deemed to be zero whenever the calculation of Credit Support
Amount yields a number less than zero.

    

    Paragraph
4.    Conditions Precedent,
Transfer Timing, Calculations and Substitutions

    

    (a)           Conditions
Precedent. Each Transfer obligation of the Pledgor under Paragraphs 3 and
5 and of the Secured Party under Paragraphs 3, 4(d)(ii), 5 and 6(d) is subject
to the conditions precedent that:

    

    (i) no
Event of Default, Potential Event of Default or Specified Condition has occurred
and is continuing with respect to the other party; and

    

    (ii) no
Early Termination Date for which any unsatisfied payment obligations exist has
occurred or been designated as the result of an Event of Default or Specified
Condition with respect to the other party.

    

    (b)           Transfer
Timing. Subject to Paragraphs 4(a) and 5 and unless otherwise specified,
if a demand for the Transfer of Eligible Credit Support or Posted Credit Support
is made by the Notification Time, then the relevant Transfer will be made not
later than the close of business on the next Local Business Day; if a demand is
made after the Notification Time, then the relevant Transfer will be made not
later than the close of business on the second Local Business Day
thereafter.

    

    (c)           Calculations.
All calculations of Value and Exposure for purposes of Paragraphs 3 and 6(d)
will be made by the Valuation Agent as of the Valuation Time. The Valuation
Agent will notify each party (or the other party, if the Valuation Agent is a
party) of its calculations not later than the Notification Time on the Local
Business Day following the applicable Valuation Date (or in the case of
Paragraph 6(d), following the date of calculation).

     

    
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    (d)           Substitutions.

    

    
      	
               
      

            	
              (i)

            	
              Unless
      otherwise specified in Paragraph 13. upon notice to the Secured Party
      specifying the items of Posted Credit Support to be exchanged, the Pledgor
      may, on any Local Business Day, Transfer to the Secured Party substitute
      Eligible Credit Support (the “Substitute Credit Support”);
    and

            

    

    

    
      	
               
      

            	
              (ii)

            	
              subject
      to Paragraph 4(a), the Secured Party will Transfer to the Pledgor the
      items of Posted Credit Support specified by the Pledgor in its notice not
      later than the Local Business Day following the date on which the Secured
      Party receives the Substitute Credit Support, unless otherwise specified
      in Paragraph 13 (the “Substitution Date”); provided that the Secured Party
      will only be obligated to Transfer Posted Credit Support with a Value as
      of the date of Transfer of that Posted Credit Support equal to the Value
      as of that date of the Substitute Credit
  Support.

            

    

    

    Paragraph
5.    Dispute
Resolution

    

    If a
party (a “Disputing Party”) disputes (I) the Valuation Agent’s calculation of a
Delivery Amount or a Return Amount or (II) the Value of any Transfer of Eligible
Credit Support or Posted Credit Support, then (1) the Disputing Party will
notify the other party and the Valuation Agent (if the Valuation Agent is not
the other party) not later than the close of business on the Local Business Day
following (X) the date that the demand is made under Paragraph 3 in the case of
(1) above or (Y) the date of Transfer in the case of (II) above, (2) subject to
Paragraph 4(a), the appropriate party will Transfer the undisputed amount to the
other party not later than the close of business on the Local Business Day
following (X) the date that the demand is made under Paragraph 3 in the case
of(I) above or (Y) the date of Transfer in the case of(II) above, (3) the
parties will consult with each other in an attempt to resolve the dispute and
(4) if they fail to resolve the dispute by the Resolution Time,
then:

    

    
      	
               
      

            	
              (i)

            	
              In
      the case of a dispute involving a Delivery Amount or Return Amount, unless
      otherwise specified in Paragraph 13, the Valuation Agent will recalculate
      the Exposure and the Value as of the Recalculation Date
  by:

            

    

    

    
      	
               
      

            	
              (A)

            	
              utilizing
      any calculations of Exposure for the Transactions (or Swap Transactions)
      that the parties have agreed are not in
dispute;

            

    

    

    
      	
               
      

            	
              (B)

            	
              calculating
      the Exposure for the Transactions (or Swap Transactions) in dispute by
      seeking four actual quotations at mid-market from Reference Market-makers
      for purposes of calculating Market Quotation, and taking the arithmetic
      average of those obtained; provided that if four quotations are not
      available for a particular Transaction (or Swap Transaction), then fewer
      than four quotations may be used for that Transaction (or Swap
      Transaction); and if no quotations are available for a particular
      Transaction (or Swap Transaction), then the Valuation Agent’s original
      calculations will be used for that Transaction (or Swap Transaction);
      and

            

    

    

    
      	
               
      

            	
              (C)

            	
              utilizing
      the procedures specified in Paragraph 13 for calculating the Value, if
      disputed, of Posted Credit Support.

            

    

    

    
      	
               
      

            	
              (ii)

            	
              In
      the case of a dispute involving the Value of any Transfer of Eligible
      Credit Support or Posted Credit Support, the Valuation Agent will
      recalculate the Value as of the date of Transfer pursuant to Paragraph
      13.

            

    

    

    Following
a recalculation pursuant to this Paragraph, the Valuation Agent will notify each
party (or the other party, if the Valuation Agent is a party) not later than the
Notification Time on the Local Business Day following the Resolution Time. The
appropriate party will, upon demand following that notice by the Valuation Agent
or a resolution pursuant to (3) above and subject to Paragraphs 4(a) and 4(b),
make the appropriate Transfer.

    

    Paragraph
6.    Holding and Using
Posted Collateral

    

    (a)           Care of Posted
Collateral. Without limiting the Secured Party’s rights under Paragraph
6(c), the Secured Party will exercise reasonable care to assure the safe custody
of all Posted Collateral to the extent required by applicable law, and in any
event the Secured Party will be deemed to have exercised reasonable care if it
exercises at least the same degree of care as it would exercise with respect to
its own property. Except as specified in the preceding sentence, the Secured
Party will have no duty with respect to Posted Collateral, including, without
limitation, any duty to collect any Distributions, or enforce or preserve any
rights pertaining thereto.

     

    
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(b)           Eligibility to
Hold Posted Collateral, Custodians.

    

    (i) General.
Subject to the satisfaction of any conditions specified in Paragraph 13 for
holding Posted Collateral, the Secured Party will be entitled to hold Posted
Collateral or to appoint an agent (a “Custodian”) to hold Posted Collateral for
the Secured Party. Upon notice by the Secured Party to the Pledgor of the
appointment of a Custodian, the Pledgor’s obligations to make any Transfer will
be discharged by making the Transfer to that Custodian. The holding of Posted
Collateral by a Custodian will be deemed to be the holding of that Posted
Collateral by the Secured Party for which the Custodian is acting.

    

    (ii)
Failure to
Satisfy Conditions. If the Secured Party or its Custodian fails to
satisfy any conditions for holding Posted Collateral, then upon a demand made by
the Pledgor, the Secured Party will, not later than five Local Business Days
after the demand, Transfer or cause its Custodian to Transfer all Posted
Collateral held by it to a Custodian that satisfies those conditions or to the
Secured Party if it satisfies those conditions.

    

    (iii)
Liability.
The Secured Party will be liable for the acts or omissions of its Custodian to
the same extent that the Secured Party would be liable hereunder for its own
acts or omissions.

    

    (c)           Use of Posted
Collateral. Unless otherwise specified in Paragraph 13 and without
limiting the rights and obligations of the parties under Paragraphs 3, 4(d)(ii),
5, 6(d) and 8, if the Secured Party is not a Defaulting Party or an Affected
Party with respect to a Specified Condition and no Early Termination Date has
occurred or been designated as the result of an Event of Default or Specified
Condition with respect to the Secured Party, then the Secured Party will,
notwithstanding Section 9-207 of the New York Uniform Commercial Code, have the
right to:

    

    (i) sell,
pledge, rehypothecate, assign, invest, use, commingle or otherwise dispose of or
otherwise use in its business any Posted Collateral it holds, free from any
claim or right of any nature whatsoever of the Pledgor, including any equity or
right of redemption by the Pledgor; and

    

    (ii)
register any Posted Collateral in the name of the Secured Party, its Custodian
or a nominee for either.

    

    For
purposes of the obligation to Transfer Eligible Credit Support or Posted Credit
Support pursuant to Paragraphs 3 and 5 and any rights or remedies authorized
under this Agreement, the Secured Party will be deemed to continue to hold all
Posted Collateral and to receive Distributions made thereon, regardless of
whether the Secured Party has exercised any rights with respect to any Posted
Collateral pursuant to (i) or (ii) above.

    

    (d)           Distributions and
Interest Amount.

    

    (i)
Distributions. Subject to Paragraph 4(a), if the Secured Party receives or is
deemed to receive Distributions on a Local Business Day, it will Transfer to the
Pledgor not later than the following Local Business Day any Distributions it
receives or is deemed to receive to the extent that a Delivery Amount would not
be created or increased by that Transfer, as calculated by the Valuation Agent
(and the date of calculation will be deemed to be a Valuation Date for this
purpose).

    

    (ii)
Interest Amount. Unless otherwise specified in Paragraph 13 and subject to
Paragraph 4(a), in lieu of any interest, dividends or other amounts paid or
deemed to have been paid with respect to Posted Collateral in the form of Cash
(all of which may be retained by the Secured Party), the Secured Party will
Transfer to the Pledgor at the times specified in Paragraph 1 3 the Interest
Amount to the extent that a Delivery Amount would not be created or increased by
that Transfer, as calculated by the Valuation Agent (and the date of calculation
will be deemed to be a Valuation Date for this purpose). The Interest Amount or
portion thereof not Transferred pursuant to this Paragraph will constitute
Posted Collateral in the form of Cash and will be subject to the security
interest granted under Paragraph 2.

     

    
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    Paragraph
7.    Events of
Default

    

    For
purposes of Section 5(a)(iii)(1) of this Agreement, an Event of Default will
exist with respect to a party if:

    

    (i) that
party fails (or fails to cause its Custodian) to make, when due, any Transfer of
Eligible Collateral, Posted Collateral or the Interest Amount, as applicable,
required to be made by it and that failure continues for two Local Business Days
after notice of that failure is given to that party;

    

    (ii) that
party fails to comply with any restriction or prohibition specified in this
Annex with respect to any of the rights specified in Paragraph 6(c) and that
failure continues for five Local Business Days after notice of that failure is
given to that party; or

    

    (iii)
that party fails to comply with or perform any agreement or obligation other
than those specified in Paragraphs 7(i) and 7(ii) and that failure continues for
30 days after notice of that failure is given to that party.

    

    Paragraph
8.    Certain Rights and
Remedies

    

    
      	
              (a)

            	
              Secured
      Party’s Rights and Remedies. If at any time (1) an Event of Default
      or Specified Condition with respect to the Pledgor has occurred and is
      continuing or (2) an Early Termination Date has occurred or been
      designated as the result of an Event of Default or Specified Condition
      with respect to the Pledgor, then, unless the Pledgor has paid in full all
      of its Obligations that are then due, the Secured Party may exercise one
      or more of the following rights and
remedies:

            

    

    

    (i) all
rights and remedies available to a secured party under applicable law with
respect to Posted Collateral held by the Secured Party;

    

    (ii) any
other rights and remedies available to the Secured Party under the terms of
Other Posted Support, if any;

    

    (iii) the
right to Set-off any amounts payable by the Pledgor with respect to any
Obligations against any Posted Collateral or the Cash equivalent of any Posted
Collateral held by the Secured Party (or any obligation of the Secured Party to
Transfer that Posted Collateral); and

    

    (iv) the
right to liquidate any Posted Collateral held by the Secured Party through one
or more public or private sales or other dispositions with such notice, if any,
as may be required under applicable law, free from any claim or right of any
nature whatsoever of the Pledgor, including any equity or right of redemption by
the Pledgor (with the Secured Party having the right to purchase any or all of
the Posted Collateral to be sold) and to apply the proceeds (or the Cash
equivalent thereof) from the liquidation of the Posted Collateral to any amounts
payable by the Pledgor with respect to any Obligations in that order as the
Secured Party may elect.

    

    Each
party acknowledges and agrees that Posted Collateral in the form of securities
may decline speedily in value and is of a type customarily sold on a recognized
market, and, accordingly, the Pledgor is not entitled to prior notice of any
sale of that Posted Collateral by the Secured Party, except any notice that is
required under applicable law and cannot be waived.

    

    
      	
              (b)

            	
              Pledgor’s
      Rights and Remedies. If at any time an Early Termination Date has
      occurred or been designated as the result of an Event of Default or
      Specified Condition with respect to the Secured Party, then (except in the
      case of an Early Termination Date relating to less than all Transactions
      (or Swap Transactions) where the Secured Party has paid in full all of its
      obligations that are then due under Section 6(e) of this
      Agreement):

            

    

    

    (i) the
Pledgor may exercise all rights and remedies available to a pledgor under
applicable law with respect to Posted Collateral held by the Secured
Party;

     

    
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    (ii) the
Pledgor may exercise any other rights and remedies available to the Pledgor
under the terms of Other Posted Support, if any;

    

    (iii) the
Secured Party will be obligated immediately to Transfer all Posted Collateral
and the Interest Amount to the Pledgor; and

    

    (iv) to
the extent that Posted Collateral or the Interest Amount is not so Transferred
pursuant to (iii) above, the Pledgor may:

    

    (A)
Set-off any amounts payable by the Pledgor with respect to any Obligations
against any Posted Collateral or the Cash equivalent of any Posted Collateral
held by the Secured Party (or any obligation of the Secured Party to Transfer
that Posted Collateral); and

    

    (B) to
the extent that the Pledgor does not Set-off under (iv)(A) above, withhold
payment of any remaining amounts payable by the Pledgor with respect to any
Obligations, up to the Value of any remaining Posted Collateral held by the
Secured Party, until that Posted Collateral is Transferred to the
Pledgor.

    

    (c)           Deficiencies and
Excess Proceeds. The Secured Party will Transfer to the Pledgor any
proceeds and Posted Credit Support remaining after liquidation, Set-off and/or
application under Paragraphs 8(a) and 8(b) after satisfaction in full of all
amounts payable by the Pledgor with respect to any Obligations; the Pledgor in
all events will remain liable for any amounts remaining unpaid after any
liquidation, Set-off and/or application under Paragraphs 8(a) and
8(b).

    

    (d)           Final
Returns. When no amounts are or thereafter may become payable by the
Pledgor with respect to any Obligations (except for any potential liability
under Section 2(d) of this Agreement), the Secured Party will Transfer to the
Pledgor all Posted Credit Support and the Interest Amount, if any.

    

    Paragraph
9.    Representations

    

    Each
party represents to the other party (which representations will be deemed to be
repeated as of each date on which it, as the Pledgor, Transfers Eligible
Collateral) that:

    

    (i) it
has the power to grant a security interest in and lien on any Eligible
Collateral it Transfers as the Pledgor and has taken all necessary actions to
authorize the granting of that security interest and lien;

    

    (ii) it
is the sole owner of or otherwise has the right to Transfer all Eligible
Collateral it Transfers to the Secured Party hereunder, free and clear of any
security interest, lien, encumbrance or other restrictions other than the
security interest and lien granted under Paragraph 2:

    

    (iii)
upon the Transfer of any Eligible Collateral to the Secured Party under the
terms of this Annex, the Secured Party will have a valid and perfected first
priority security interest therein (assuming that any central clearing
corporation or any third-party financial intermediary or other entity not within
the control of the Pledgor involved in the Transfer of that Eligible Collateral
gives the notices and takes the action required of it under applicable law for
perfection of that interest); and

    

    (iv) the
performance by it of its obligations under this Annex will not result in the
creation of any security interest, lien or other encumbrance on any Posted
Collateral other than the security interest and lien granted under Paragraph
2.

    

    Paragraph
10.    Expenses

    

    (a)           General.
Except as otherwise provided in Paragraphs 10(b) and 10(c), each party will pay
its own costs and expenses in connection with performing its obligations under
this Annex and neither party will be liable for any costs and expenses incurred
by the other party in connection herewith.

     

    
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(b)           Posted Credit
Support. The Pledgor will promptly pay when due all taxes, assessments or
charges of any nature that are imposed with respect to Posted Credit Support
held by the Secured Party upon becoming aware of the same, regardless of whether
any portion of that Posted Credit Support is subsequently disposed of under
Paragraph 6(c), except for those taxes, assessments and charges that result from
the exercise of the Secured Party’s rights under Paragraph 6(c).

    

    (c)           Liquidation/Application
of Posted Credit Support. All reasonable costs and expenses incurred by
or on behalf of the Secured Party or the Pledgor in connection with the
liquidation and/or application of any Posted Credit Support under Paragraph 8
will be payable, on demand and pursuant to the Expenses Section of this
Agreement, by the Defaulting Party or, if there is no Defaulting Party, equally
by the parties.

    

    Paragraph
11.    Miscellaneous

    

    (a)           Default
Interest. A Secured Party that fails to make, when due, any Transfer of
Posted Collateral or the Interest Amount will be obligated to pay the Pledgor
(to the extent permitted under applicable law) an amount equal to interest at
the Default Rate multiplied by the Value of the items of property that were
required to be Transferred, from (and including) the date that Posted Collateral
or Interest Amount was required to be Transferred to (but excluding) the date of
Transfer of that Posted Collateral or Interest Amount. This interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed.

    

    (b)           Further
Assurances. Promptly following a demand made by a party, the other party
will execute, deliver, file and record any financing statement, specific
assignment or other document and take any other action that may be necessary or
desirable and reasonably requested by that party to create, preserve, perfect or
validate any security interest or lien granted under Paragraph 2, to enable that
party to exercise or enforce its rights under this Annex with respect to Posted
Credit Support or an Interest Amount or to effect or document a release of a
security interest on Posted Collateral or an Interest Amount.

    

    (c)           Further
Protection. The Pledgor will promptly give notice to the Secured Party
of, and defend against, any suit, action, proceeding or lien that involves
Posted Credit Support Transferred by the Pledgor or that could adversely affect
the security interest and lien granted by it under Paragraph 2, unless that
suit, action, proceeding or lien results from the exercise of the Secured
Party’s rights under Paragraph 6(c).

    

    (d)           Good Faith and
Commercially Reasonable Manner. Performance of all obligations under this
Annex, including, but not limited to, all calculations, valuations and
determinations made by either party, will be made in good faith and in a
commercially reasonable manner.

    

    (e)           Demands and
Notices. All demands and notices made by a party under this Annex will be
made as specified in the Notices Section of this Agreement, except as otherwise
provided in Paragraph 13.

    

    (f)           Specifications of
Certain Mutters. Anything referred to in this Annex as being specified in
Paragraph 13 also may be specified in one or more Confirmations or other
documents and this Annex will be construed accordingly.

    

    Paragraph
12.    Definitions

    

    As used
in this Annex:-

    

    “Cash”
means the lawful currency of the United States of America.

    

    “Credit Support
Amount” has the meaning specified in Paragraph 3.

    

    “Custodian”
has the meaning specified in Paragraphs 6(b)(i) and 13.

    

    “Delivery
Amount” has the meaning specified in Paragraph 3(a).

    

    “Disputing
Party” has the meaning specified in Paragraph 5.

     

    
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“Distributions”
means with respect to Posted Collateral other than Cash, all principal, interest
and other payments and distributions of cash or other property with respect
thereto, regardless of whether the Secured Party has disposed of that Posted
Collateral under Paragraph 6(c). Distributions will not include any item of
property acquired by the Secured Party upon any disposition or liquidation of
Posted Collateral or, with respect to any Posted Collateral in the form of Cash,
any distributions on that collateral, unless otherwise specified
herein.

    

    “Eligible
Collateral” means, with respect to a party, the items, if any, specified
as such for that party in Paragraph 13.

    

    “Eligible Credit
Support” means Eligible Collateral and Other Eligible
Support.

    

    “Exposure”
means for any Valuation Date or other date for which Exposure is calculated and
subject to Paragraph 5 in the case of a dispute, the amount, if any, that would
be payable to a party that is the Secured Party by the other party (expressed as
a positive number) or by a party that is the Secured Party to the other party
(expressed as a negative number) pursuant to Section 6(e)(ii)(2)(A) of this
Agreement as if all Transactions (or Swap Transactions) were being terminated as
of the relevant Valuation Time; provided that Market Quotation will be
determined by the Valuation Agent using its estimates at mid-market of the
amounts that would be paid for Replacement Transactions (as that term is defined
in the definition of Market Quotation”).

    

    “Independent
Amount” means, with respect to a party, the amount specified as such for
that party in Paragraph 13; if no amount is specified, zero.

    

    “Interest
Amount” means, with respect to an Interest Period, the aggregate sum of
the amounts of interest calculated for each day in that Interest Period on the
principal amount of Posted Collateral in the form of Cash held by the Secured
Party on that day, determined by the Secured Party for each such day as
follows:

    

    (x) the
amount of that Cash on that day; multiplied by

    

    (y) the
Interest Rate in effect for that day; divided by

    

    (z)
360.

    

    “Interest
Period” means the period from (and including) the last Local Business Day
on which an Interest Amount was Transferred (or, if no Interest Amount has yet
been Transferred, the Local Business Day on which Posted Collateral in the form
of Cash was Transferred to or received by the Secured Party) to (but excluding)
the Local Business Day on which the current Interest Amount is to be
Transferred.

    

    “Interest
Rate” means the rate specified in Paragraph 13.

    

    “Local Business
Day”, unless otherwise specified in Paragraph 13, has the meaning
specified in the Definitions Section of this Agreement, except that references
to a payment in clause (b) thereof will be deemed to include a Transfer under
this Annex.

    

    “Minimum Transfer
Amount” means, with respect to a party, the amount specified as such for
that party in Paragraph 13 ; if no amount is specified, zero.

    

    “Notification
Time” has the meaning specified in Paragraph 13.

    

    “Obligations”
means, with respect to a party, all present and future obligations of that party
under this Agreement and any additional obligations specified for that party in
Paragraph 13.

    

    “Other Eligible
Support” means, with respect to a party, the items, if any, specified as
such for that party in Paragraph 13.

    

    “Other Posted
Support” means all Other Eligible Support Transferred to the Secured
Party that remains in effect for the benefit of that Secured Party.

     

    
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“Pledgor”
means either party, when that party (i) receives a demand for or is required to
Transfer Eligible Credit Support under Paragraph 3(a) or (ii) has Transferred
Eligible Credit Support under Paragraph 3(a).

    

    “Posted
Collateral” means all Eligible Collateral, other property, Distributions,
and all proceeds thereof that have been Transferred to or received by the
Secured Party under this Annex and not Transferred to the Pledgor pursuant to
Paragraph 3(b), 4(d)(ii) or 6(d)(i) or released by the Secured Party under
Paragraph 8. Any Interest Amount or portion thereof not Transferred pursuant to
Paragraph 6(d)(ii) will constitute Posted Collateral in the form of
Cash.

    

    “Posted Credit
Support” means Posted Collateral and Other Posted Support.

    

    “Recalculation
Date” means the Valuation Date that gives rise to the dispute under
Paragraph 5; provided, however, that if a subsequent Valuation Date occurs under
Paragraph 3 prior to the resolution of the dispute, then the “Recalculation
Date” means the most recent Valuation Date under Paragraph 3.

    

    “Resolution
Time” has the meaning specified in Paragraph 13.

    

    “Return
Amount" has the meaning specified in Paragraph 3(b).

    

    “Secured
Party” means either party, when that party (i) makes a demand for or is
entitled to receive Eligible Credit Support under Paragraph 3(a) or (ii) holds
or is deemed to hold Posted Credit Support.

    

    “Specified
Condition” means, with respect to a party, any event specified as such
for that party in Paragraph 13.

    

    “Substitute
Credit Support” has the meaning specified in Paragraph
4(d)(i).

    

    “Substitution
Date” has the meaning specified in Paragraph 4(d)(ii).

    

    “Threshold”
means, with respect to a party, the amount specified as such for that party in
Paragraph 13; if no amount is specified, zero.

    

    “Transfer”
means, with respect to any Eligible Credit Support, Posted Credit Support or
Interest Amount, and in accordance with the instructions of the Secured Party,
Pledgor or Custodian, as applicable:

    

    (i) in
the case of Cash, payment or delivery by wire transfer into one or more bank
accounts specified by the recipient;

    

    (ii) in
the case of certificated securities that cannot be paid or delivered by
book-entry, payment or delivery in appropriate physical form to the recipient or
its account accompanied by any duly executed instruments of transfer,
assignments in blank, transfer tax stamps and any other documents necessary to
constitute a legally valid transfer to the recipient;

    

    (iii) in
the case of securities that can be paid or delivered by book-entry, the giving
of written instructions to the relevant depository institution or other entity
specified by the recipient, together with a written copy thereof to the
recipient, sufficient if complied with to result in a legally effective transfer
of the relevant interest to the recipient; and

    

    (iv) in
the case of Other Eligible Support or Other Posted Support, as specified in
Paragraph 13.

    

    “Valuation
Agent” has the meaning specified in Paragraph 13.

    

    “Valuation
Date” means each date specified in or otherwise determined pursuant to
Paragraph 13.

    

    “Valuation
Percentage” means, for any item of Eligible Collateral, the percentage
specified in Paragraph 13.

    

    “Valuation
Time” has the meaning specified in Paragraph 13.

     

    
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“Value”
means for any Valuation Date or other date for which Value is calculated and
subject to Paragraph 5 in the case of a dispute, with respect to:

    

    (i)
Eligible Collateral or Posted Collateral that is:

    

    (A) Cash,
the amount thereof; and

    

    (B) a
security, the bid price obtained by the Valuation Agent multiplied by the
applicable Valuation Percentage, if any;

    

    (ii)
Posted Collateral that consists of items that are not specified as Eligible
Collateral, zero; and (iii) Other Eligible Support and Other Posted Support, as
specified in Paragraph 13.

    

    Paragraph
13.                                Elections
and Variables

    

    (a)           Security Interest
for "Obligations". The term "Obligations" as used in this Annex includes
the following additional obligations

    

    With
respect to Party A: All obligations for borrowed money (whether present or
future, contingent or

    otherwise
as principal or surety or otherwise) owed by Party A to Party B or any
affiliate(s) of Party B.

    

    With
respect to Party B: None

    

    (b)           Credit Support
Obligations.

    

    (i) Delivery Amount,
Return Amount and Credit Support Amount.

    

    (A)
"Delivery Amount" has the meaning specified in Paragraph 3(a).

    

    (B)
"Return Amount" has the meaning specified in Paragraph 3(b).

    

    (C)
"Credit Support Amount" has the meaning specified in Paragraph 3.

    

    (ii)
Eligible
Collateral. The following items will qualify as "Eligible Collateral" for
the party specified:

    

    

    
      	 
      	
              Party
      A

            	
              Party
      B

            	
              Valuation

              Percentage

            
	
              (A)
      Cash

            	
              X

            	
              X

            	
              100%

            
	 	 	 	 
	
              (B)
      Bills issued by the U.S. Treasury Department

              (original
      maturity of not more than one year).

            	
              X

            	
              X

            	
              99%

            
	 	 	 	 
	
              (C)
      Eligible Treasuries having a remaining

              maturity
      of not more than 5 years.

            	
              X

            	
              X

            	
              98%

            
	 	 	 	 
	
              (D)
      Eligible Treasuries having a remaining

              maturity
      of more than 5 years but not more than 10 years.

            	
              X

            	
              X

            	
              96%

            
	 	 	 	 
	
              (E)
      Eligible Treasuries having a remaining

              maturity
      of more than 10 years.

            	
              X

            	
              X

            	
              95%

            

    

    

    (F)
Other: As may be subsequently agreed to by both parties.

     

    
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    "Eligible
Treasuries" means negotiable debt obligations (other than principal-only
or interest-only obligations) issued by the U.S. Treasury Department with
original maturities of at least one year.

    

    (iii)
Other
Eligible Support. Such other property as the Secured Party, in its sole
discretion, shall deem acceptable, with such Valuation Percentage applied
thereto as the Secured Party, in its sole discretion, shall deem
appropriate.

    

    (iv)
Thresholds.

    

    
      	
               
      

            	
              (A)

            	
              "Independent
      Amount" means zero with respect to Party A and Party
    B.

            

    

    

    
      	
               
      

            	
              (B)

            	
              "Threshold"
      means, with respect to a Party A on any date of determination, $
      1,800,000; provided that Party A’s Threshold shall be zero if (i) an Event
      of Default has occurred and is continuing with respect to the Party
      A:

            

    

    

    "Threshold"
means, with respect to a Party B, N/A.

    

    
      	
               
      

            	
              (C)

            	
              "Minimum
      Transfer Amount" means zero with respect to a Party
    A.

            

    

    

    
      	
               
      

            	
              (D)

            	
              Rounding:
      The Delivery Amount and the Return Amount will be rounded down to the
      nearest integral multiple of
$10,000.

            

    

    

    (c)           Valuation and
Timing.

    

    
      	
               
      

            	
              (i)

            	
              "Valuation
      Agent" means, for purposes of Paragraphs 3 and 5, the party making
      the demand under Paragraph 3, and, for purposes of Paragraph 6(d), the
      Secured Party receiving or deemed to receive the Distributions or the
      Interest Amount, as applicable.

            

    

    

    
      	
               
      

            	
              (ii)

            	
              "Valuation
      Date" means any Local Business Day on which a demand is made before
      5:00 p.m., New York time, pursuant to Paragraph
  3.

            

    

    

    
      	
               
      

            	
              (iii)

            	
              "Valuation
      Time" means the close of business on the Local Business Day before
      the Valuation Date or date of calculation, as applicable; provided that
      the calculations of Value and Exposure will be made as of approximately
      the same time on the same date.

            

    

    

    
      	
               
      

            	
              (iv)

            	
              "Notification
      Time" means 1:00 p.m., New York time, on a Local Business
      Day.

            

    

    

    
      	
               
      

            	
              (v)

            	
              "Close of
      Business" means close of business in New York
  City.

            

    

    

    (d)           Conditions
Precedent and Secured Party's Rights and Remedies. The following
Termination Event(s) will be a "Specified Condition" for Party A and Party B
(that party being the Affected Party if the Termination Event occurs with
respect to that party):

    

    
      	
              Illegality

            	
              Tax
      Event

            
	
              Credit
      Event Upon Merger

            	
              Tax
      Event Upon Merger

            
	
              Additional
      Termination Event(s)

            	 
      

    

    

    
      	
              (e)

            	
              Substitution.

            

    

    

    
      	
               
      

            	
              (i)

            	
              "Substitution
      Date" has the meaning specified in Paragraph
    4(d)(ii).

            

    

    

    
      	
               
      

            	
              (ii)

            	
              Consent.
      If specified here as applicable, then the Pledgor must obtain the Secured
      Party's consent for any substitution pursuant to Paragraph 4(d):
      applicable.

            

    

     

    
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(f)           Dispute
Resolution.

    

    
      	
               
      

            	
              (i)

            	
              "Resolution
      Time" means 1:00 p.m., New York time, on the Local Business Day
      following the date on which the notice of the dispute is given under
      Paragraph 5.

            

    

    

    
      	
               
      

            	
              (ii)

            	
              Value.
      For the purpose of Paragraphs 5(i)(C) and 5(ii), the Value of Posted
      Credit Support will be calculated as
follows:

            

    

    

    An amount
equal to the average of the bid quotes provided on such a date by two or more
recognized dealers selected in good faith by the Valuation Agent or, if no such
quotes are available on such date, the average of the bid quotes as of the day
next preceding such date on which such quotes were available, multiplied by the
applicable Valuation Percentage.

    

    
      	
               
      

            	
              (iii)

            	
              Alternative.
      The provisions of Paragraph 5 shall
apply.

            

    

    

    (g)           Holding and Using
Posted Collateral.

    

    
      	
               
      

            	
              (i)

            	
              Eligibility
      to Hold Posted Collateral; Custodians. Party B and its Custodian
      will be entitled to hold Posted Collateral pursuant to Paragraph 6(b);
      provided that the following conditions applicable to it are
      satisfied:

            

    

    

    
      	
               
      

            	
              (1)

            	
              Party
      B: (i) is not a Defaulting Party and (ii) maintains a Credit Rating of at
      least BBB from S&P and Baa2 from
Moody's.

            

    

    

    
      	
               
      

            	
              (2)

            	
              The
      Custodian for Party B maintains a Credit Rating with respect to its
      long-term unsecured unsubordinated indebtedness of at least BBB from
      S&P or Baa2 from Moody's.

            

    

    

    Initially,
the Custodian for Party
B is:

    

    a) Bank
of Oklahoma, N.A., Tulsa.

    

    
      	
               
      

            	
              (ii)

            	
              Use of
      Posted Collateral. In addition to the other conditions set forth in
      Paragraph 6(c), the Secured Party's rights under Paragraph 6(c) are
      subject to the condition precedent that the Secured Party has a Credit
      Rating of at least BBB from S&P and Baa2 from
  Moody's.

            

    

    

    (h)           Distributions and
Interest Amount. No interest, dividends or other amounts shall be paid or
deemed to have been paid with respect to Posted Collateral in the form of Cash,
and the provisions of

    Paragraph
6(d)(ii) will not apply.

    

    (i)           Interest
Rate. The "Interest Rate" means zero.

    

    (ii)           Transfer of
Interest Amount. Not Applicable

    

    (iii)           Alternative to
Interest Amount. Not Applicable

    

    (i)           Additional
Representation(s). Party A represents that the necessary action to
authorize referred to in Section 3(a)(ii) of this Agreement includes all
authorizations required under any applicable agreement, writ, decree, or order
entered into with the Pledgor’s supervisory authorities; and at all times during
the term of this Agreement, the Pledgor will continuously include and maintain
as a part of its official written books and records this Agreement, any Credit
Support Document to which it is a party and all other exhibits, supplements and
attachments hereto and documents incorporated by reference herein, including all
Confirmations, and evidence of all necessary authorizations. This Agreement, any
Credit Support Document to which the Pledgor is a party, each Confirmation, and
any other documentation relating to this Agreement to which it is a party or
that it is required to deliver will be executed and delivered by a duly
appointed or elected and authorized officer of the Pledgor of the level of
vice-president or higher. The Pledgor and the Secured Party agree that each
Transaction and the Agreement are a “swap agreement” and a “qualified financial
contract” and that the Agreement is a “master agreement”, for purposes of
Section 11(e)(8) of the Federal Deposit Insurance Act or any successor
provisions.

     

    
      ISDA® 1992

    

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

    
(j)           Other Eligible
Support and Other Posted Support.

    

    (i)           "Value"
with respect to Other Eligible Support and Other Posted Support means: not
applicable

    

    
      	
               
      

            	
              (i)

            	
              "Transfer"
      with respect to Other Eligible Support and Other Posted Support means: not
      applicable

            

    

    

    (k)           Demands and
Notices.

    

    All
demands, specifications and notices under this Annex will be made pursuant to
the Notices Section of this Agreement, unless otherwise specified
here:

    

    Party A:
AMERICA’S CAR-MART, INC., AN ARKANSAS CORPORATION AND TEXAS CAR-MART, INC., A
TEXAS CORPORATION, (2.) COLONIAL AUTO FINANCE, INC., AN ARKANSAS
CORPORATION.

    

    Name:
JEFF WILLIAMS

    

    Address1:
802 S.E. PLAZA AVENUE, SUITE 200

    

    Address2:

    

    City:
BENTONVILLE, State: AR Zip Code: 72712

    

    Fax:
(479) 464-4234

    

    Attention:
JEFF WILLIAMS

    

    

    

    Party
B:   BANK OF OKLAHOMA, N.A.

    Attn:
Brad Emmons, 9-NE

    One
Williams Center

    Tulsa, OK
74192

    Telephone:
918.588.8238

    Facsimile:
918.588.6957

    

    (l)           
Addresses
for Transfers.

    

    Party A:
As set forth in demands and notices from one party to the other party from time
to time.

    Party B:
As set forth in demands and notices from one party to the other party from time
to time.

    

    (m)           Other
Provisions.

    

    
      	
               
      

            	
              (i)

            	
              Distributions.
      If Transfer of a Distribution (or any portion thereof) to a Pledgor on any
      day would result in, or increase, a Delivery Amount (treating that day as
      a Valuation Date, as provided in Paragraph 6(d)(i)) but the Pledgor would
      nonetheless have no obligation to make a Transfer pursuant to Paragraph
      3(a) on that day if it were a Valuation Date (because the Delivery Amount
      is lower than the Pledgor's Minimum Transfer Amount or otherwise), the
      Secured Party will be required to Transfer that Distribution (or portion
      thereof) to the Pledgor, notwithstanding anything to the contrary in
      Paragraph 6(d)(i).

            

    

     

    
      ISDA® 1992

    

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

     

    (n)           "Affiliate(s)"
shall mean one or more of the following with respect to Party B: Bank of
Albuquerque, N.A., Bank of Texas, N.A., Bank of Arkansas, N.A., Colorado State
Bank and Trust, N.A.

    

    IN WITNESS WHEREOF the parties
have executed this Credit Support Annex as of the date hereof.

    

    
      	
              PARTY
      A:

            	 
      	
              PARTY
      B:

            	 
      
	 
      	 
      	 
      	 
      
	
              COLONIAL
      AUTO FINANCE, INC., AN

            	 
      	 
      	 
      
	
              ARKANSAS
      CORPORATION.

            	 
      	
              BANK
      OF OKLAHOMA, N.A.

            	 
      

    

     

    
      	
              By:

            	
              /s/ T.J. Falgout

            	 
      	
              By:

            	
              /s/ Jim Huntsinger

            	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
              Name:
      T.J. Falgout, III

            	 
      	 
      	
              Name:
      Jim Huntzinger

            	 
      
	 	 	 	 	 	 
	 
      	
              Title:
      President

            	 
      	 
      	
              Title:
      Chief Investment Officer

            	 
      
	 	 	 	 	 	 
	 
      	
              Date:
      May 16, 2008

            	 
      	 
      	
              Date:
      May 16, 2008

            	 
      

    

    

    

    AMERICA’S
CAR-MART, INC., A TEXAS

    CORPORATION,
FORMERLY KNOWN AS

    CROWN
GROUP, INC.

    

    

    
      	
              By:

            	
               /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 	 	 
	 
      	
              Title:
      Vice President

            	 
      
	 	 	 
	 
      	
              Date:
      May 16, 2008

            	 
      

    

    

    

    AMERICA’S
CAR-MART, INC., AN

    ARKANSAS
CORPORATION

    

    

    
      	
              By:

            	
               /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 	 	 
	 
      	
              Title:
      Vice President

            	 
      
	 	 	 
	 
      	
              Date:
      May 16, 2008

            	 
      

    

    

    

    TEXAS
CAR-MART, INC., A TEXAS

    CORPORATION

    

    

    
      	
              By:

            	
              /s/ Jeff Williams

            	 
      
	 
      	 
      	 
      
	 
      	
              Name:
      Jeff Williams

            	 
      
	 	 	 
	 
      	
              Title:
      Vice President

            	 
      
	 	 	 
	 
      	
              Date:
      May 16,
      2008

            	 
      

    

     

    
      ISDA® 1992

    

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

     

    Trade
Details:

     

    
      	
              America’s
      Car-Mart, Inc.

            	 
      
	 
      	 
      
	
              Notional:

            	
              $20,000,000.00

            
	
              Trade:

            	
              05/16/2008

            
	
              Effective:

            	
              05/20/2008

            
	
              Maturity:

            	
              05/31/2013

            
	
              Car-Mart
      Pays:

            	
              FIXED AT 6.43%, monthly,
      ACT/360

            
	
              Car-Mart
      Recs:

            	
              FLOAT,
      DWA USD-PRIME-H.15, monthly payment, ACT/360

            
	
              Rolls:

            	
              Payment
      on the last day of each month, daily resets

            
	
              Holidays:

            	
              NY
      only

            
	
              First
      Pmt:

            	
              05/31/2008

            
	
              Next-to-Last
      Pmt:

            	
              04/30/2013

            

    

     

     

     

    
      ISDA® 1992

       

      42Amendment No. 1 to the Credit Agreement

 Exhibit 10.1 
 AMENDMENT NO. 1 TO THE CREDIT AGREEMENT dated as of May 15, 2008 among LeapFrog Enterprises, Inc., a Delaware Corporation (the “Borrower”), the banks, financial institutions and other
institutional lenders listed on the signature pages hereof as the Lenders (the “Lenders”) and Bank of America, N.A., as agent for the Lenders (the “Agent”). 
 PRELIMINARY STATEMENTS: 
 (1)
WHEREAS, the parties hereto have entered into a Credit Agreement dated as of November 8, 2005 (the “Credit Agreement”). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit
Agreement. 
 (2) WHEREAS, the Borrower has requested that the Credit Agreement be amended as provided herein. 
 (3) The Majority Lenders are, on the terms and conditions stated below, willing to grant the request of the Borrower and the Borrower and the Majority
Lenders have agreed to amend the Credit Agreement as hereinafter set forth. 
 SECTION 1. Amendments to Credit Agreement. The Credit
Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2, hereby amended as follows: 
 (a) Section 1.1 is amended by (x) deleting the figure “$75,000,000” therein and substituting therefor the figure “$100,000,000” and (y) inserting the words “subject to increase
as provided in Section 1.5,” before the words “the ‘Total Facility’” in the parenthetical in the second line of such section. 
 (b) Section 1.5 is amended and restated in its entirety as follows: 
 “1.5 Increase in the
Aggregate Commitments. 
 (a) The Borrower may, at any time and from time to time, by notice to the Agent, request that
the aggregate amount of the Commitments be increased by an aggregate amount of up to $50,000,000 (each an ‘Accordion Increase’ and collectively the ‘Accordion Increases’) to be effective as of the date upon which the conditions
set forth in Section 1.5(d) below are fulfilled to the satisfaction of the Agent (each such date an ‘Accordion Effective Date’); provided, however, that (i) in no event shall the aggregate amount of the
Commitments hereunder exceed $150,000,000, and (ii) no Default or Event of Default shall have occurred and be continuing as of the date of such request or as of any Accordion Effective Date, or shall occur as a result thereof. 
 (b) The Agent may, in its sole discretion, promptly notify the Lenders of a request by the Borrower for an Accordion Increase, which
notice shall include the date by which Lenders wishing to participate in such Accordion Increase must commit to an increase in the amount of their respective Commitments (each such date a ‘Commitment Date’). Each Lender that is willing to
participate in such Accordion Increase (each an ‘Increasing Lender’) shall give written notice to the Agent on or prior to the applicable Commitment Date of the amount by which it is willing to increase its Commitment. If the Lenders
notify the Agent that they are willing to increase the amount of their respective Commitments by an aggregate amount that exceeds the aggregate amount of such Accordion Increase, such Accordion Increase shall be allocated among the Lenders willing
to participate therein in such amounts as are agreed between the Borrower and the Agent. 
  

 1 

 (c) Promptly following the applicable Commitment Date, the Agent shall notify the
Borrower as to the amount, if any, by which the Lenders are willing to participate in the applicable Accordion Increase. If the aggregate amount by which the Lenders are willing to participate in such Accordion Increase on the applicable Commitment
Date is less than the amount requested by the Borrower, then the Borrower may extend offers to one or more Eligible Assignees to participate in any portion of the Accordion Increase that has not been committed to by the Lenders as of the Commitment
Date; provided, however, that the Commitment of each such Eligible Assignee shall be in an amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof (or such lesser amounts as may be necessary to cause the aggregate
increase to equal the Accordion Increase). 
 (d) On each Accordion Effective Date, each Eligible Assignee that accepts an
offer to participate in the applicable Accordion Increase in accordance with Section 1.5(c) (each such Eligible Assignee being an ‘Assuming Lender’) shall become a Lender party to this Agreement as of such Accordion Effective
Date and the Commitment of each Increasing Lender for such Accordion Increase shall be so increased by such amount (or by the amount allocated to such Lender pursuant to the last sentence of Section 1.5(b)) as of such Accordion Effective
Date and the Commitment of each Lender as set forth on Schedule 1 shall be adjusted accordingly; provided, that on or before the initial Accordion Effective Date, a Successful Syndication shall have been achieved and on or before each
Accordion Effective Date: 
 (1) all amendments to this Agreement deemed reasonably necessary by the Agent to accomplish such
Accordion Increase shall have been agreed by the parties hereto and any Assuming Lenders; 
 (2) all necessary approvals shall
have been obtained by each of the Increasing Lenders, the Assuming Lenders and the Agent; and 
 (3) the Agent shall have
received the following, each dated such date: 
 (A)(i) certified copies of resolutions of the Board of Directors of the
Borrower or the Executive Committee of such Board approving such Accordion Increase and the corresponding modifications to this Agreement and (ii) if requested, an opinion of counsel for the Borrower (which may be in-house counsel), in form and
substance satisfactory to the Agent; 
 (B) an assumption agreement from each Assuming Lender, if any, in form and substance
satisfactory to the Borrower and the Agent (each an ‘Assumption Agreement’), duly executed by such Eligible Assignee, the Agent and the Borrower; and 
 (C) confirmation from each Increasing Lender of the increase in the amount of its Commitment in a writing satisfactory to the Borrower
and the Agent. 
 On each Accordion Effective Date, upon fulfillment of the conditions set forth in the immediately preceding
sentence of this Section 1.5(d), the Agent shall notify the Lenders (including, without limitation, each Assuming Lender) and the Borrower, on or before 12:00 noon (San Francisco time), by telecopier, of the occurrence of each Accordion
Increase and shall record in the Register the relevant information with respect to each Increasing Lender and each Assuming Lender on such date. The Borrower shall prepay Loans on each Accordion Effective Date to the extent necessary to cause the
outstanding Loans to be ratable with the Commitment of each Lender. This Section shall supersede the provisions of Sections 3.5 and 11.1 as applicable.” 
  

 2 

 (c) Section 2.5 is amended by deleting the number “0.25%” contained therein and by
replacing such number with “0.50%”. 
 (d) Section 3.5 is amended by
inserting the words “subject to the last sentence of Section 13.13,” after the word “second” in the 10th line
thereof. 
 (e) Section 6.5(a) is amended by inserting the words “(as updated by Borrower from time to time)” after the words
“Schedule 6.5(a) to the Disclosure Letter” in the first line of such Section. 
 (f) Section 6.5(b) is amended by
(x) inserting the words “(as updated by Borrower from time to time)” after the words “Schedule 6.5(b) to the Disclosure Letter hereto” in the first line of such Section and (y) inserting the words “or the
date of any such updated Schedule, as the case may be,” after the words “the date hereof” in the second and third lines of such Section. 
 (g) Section 6.24 is amended by (x) inserting the words “(as updated by Borrower from time to time)” after the words “Schedule 6.24 to the Disclosure Letter” in the first line of
such Section and (y) inserting the words “or the date of any such updated Schedule, as the case may be,” after the words “the Closing Date” in the first and second lines of such Section. 
 (h) Section 7.8(a)(1)(B) is amended by inserting the words “except with respect to any Domestic Subsidiary which is an Immaterial
Subsidiary,” at the beginning of such Section. 
 (i) Section 7.8(b) is amended by (x) inserting the words
“first-tier” before the word “Foreign” in the first line of such Section and (y) inserting the words “(other than LF Macao Commercial Offshore Limited, LeapFrog Digital Technology (Shenzhen), Company Limited, LF
Edu-Tech China Co., Ltd. and any Foreign Subsidiary which is an Immaterial Subsidiary)” after the word “Subsidiary” in the first line of such Section. 
 (j) Section 7.14 is amended by (x) deleting the word “and” in the third line of subsection (i); (y) inserting new subsection (j) to read as follows: “Debt in a principal amount not
in excess of $10,000,000 secured solely by certain auction rate securities owned by the Borrower as of May 1, 2008; and”; and (z) renumbering existing subsection (j) as new subsection (k). 
 (k) Section 7.19 is amended by (x) deleting the word “and” in the first line of subsection (e); (y) inserting new subsection
(f) to read as follows: “Liens on auction rate securities owned by the Borrower as of May 1, 2008 to secure Debt permitted under Section 7.14(j); and”; and (z) renumbering existing subsection (f) as new
subsection (g). 
 (l) Article 7 is amended by inserting a new Section 7.27 to read as follows: 
 “7.27 Proprietary Rights. Within ninety (90) days of the date of Amendment No. 1 to this Agreement, or such later
date as the Agent may agree to in its sole discretion, the Agent shall have received evidence, satisfactory to the Agent, that the Borrower and each of the Guarantors has granted to the Agent for the benefit of the Secured Parties a first priority
security interest in all of the Borrower’s or such Guarantor’s domestic Proprietary Rights and has executed all documents and taken all other actions necessary as the Agent may deem necessary or desirable to perfect such security
interest.” 
 (m) Section 12.11(a) is amended by (x) deleting the word “or” before “(4)” in the tenth line
of such Section; (y) inserting new subsection (4) to read as follows: “(4) consisting of auction rate securities which are pledged as collateral in connection with financings referred to in Section 7.14(j); or”; and
(z) renumbering existing subsection (4) as new subsection (5). 
  

 3 

 (n) Section 13.13 is amended by inserting at the end of such Section the words “Notwithstanding
anything in this Agreement to the contrary, any modification, rescission, waiver, release or amendment to the Wachovia Fee Letter may be made by a written agreement signed by the Borrower and a duly authorized representative of Wachovia Capital
Finance Corporation (Western) (‘WCFCW’), without the necessity of the consent of any other Lender or of the Agent, provided, that WCFCW shall provide to the Agent (i) written notification of any such modification, rescission,
waiver, release or amendment within two business days of the effectiveness thereof and (ii) a summary of any increase in any financial obligations of the Borrower thereunder as a result of such modification, rescission, waiver, release or
amendment and provided, further, that to the extent any such modification, rescission, waiver, release or amendment increases the financial obligations of the Borrower thereunder, all such additional financial obligations shall
constitute Obligations under the seventh level for purposes of Section 3.5 and not Obligations under the second level of such Section, unless such modification, rescission, waiver, release or amendment has been consented to
by the Majority Lenders.” 
 (o) Annex A is amended by deleting the definitions of “Borrowing Base”, “Loan
Documents”, “Majority Lenders” and “Maximum Revolver Amount” therein and replacing them with the following definitions: 
 “ ‘Borrowing Base’ means, at any time, an amount equal to (a) the sum of (A) eighty-five percent
(85%) of the Net Amount of Eligible Accounts; plus (B) the lesser of (i) sixty-five percent (65%) of Eligible Inventory, (ii) eighty-five percent (85%) of the Net Orderly Liquidation Value of Eligible Inventory
and (iii) the Maximum Inventory Loan Amount plus (C) one hundred percent (100%) of the amount of cash and Cash Equivalents collectively maintained in the Borrowing Base Cash Collateral Account; minus (b) Reserves
from time to time established by the Agent in its reasonable credit judgment, provided that in respect of clause (B) above, until (i) the receipt by the Agent of a satisfactory third-party inventory appraisal, (ii) the
completion of a satisfactory field examination of the Inventory by the Agent, and (iii) the perfection of the Agent’s security interests in the Eligible Inventory in a manner satisfactory to the Agent, the advance rate in respect of
Eligible Inventory shall be 0%.” 
 “ ‘Loan Documents’ means this Agreement, the Security
Agreement, the Mortgages, the Wachovia Fee Letter, Subsidiary Guaranties, Disclosure Letter and any other agreements, instruments, and documents heretofore, now or hereafter evidencing, securing, guaranteeing or otherwise relating to the
Obligations, the Collateral, or any other aspect of the transactions contemplated by this Agreement.” 
 “
‘Majority Lenders’ means at any date of determination Lenders whose Pro Rata Shares aggregate more than 50%, provided, that if at any date of determination there are two or more unaffiliated Lenders, Majority Lenders shall
mean at least two unaffiliated Lenders whose Pro Rata Shares aggregate more than 50%.” 
 “ ‘Maximum
Revolver Amount’ means $100,000,000, subject to increase as provided in Section 1.5.” 
 (p) Annex A is amended by
inserting three new definitions in the appropriate alphabetical order to read as follows: 
 “ ‘Immaterial
Subsidiary’ means a Subsidiary whose total assets as of the fiscal quarter immediately preceding the date of determination are less than $500,000; provided, that at no time shall the aggregate amount of total assets as of the fiscal
quarter immediately preceding the date of determination for all Immaterial Subsidiaries exceed 

  

 4 

 
$2,500,000; provided, further, that if the aggregate amount of total assets as of the fiscal quarter immediately preceding the date of
determination for all Immaterial Subsidiaries exceeds $2,500,000, the Borrower shall immediately identify to the Agent in writing one or more Subsidiaries which will no longer be deemed ‘Immaterial Subsidiaries’ for purposes of this
Agreement such that the aggregate amount of total assets as of the fiscal quarter immediately preceding the date of determination for the remaining Immaterial Subsidiaries does not exceed $2,500,000.” 
 “ ‘Net Orderly Liquidation Value’ has the meaning customarily given to such term by third-party appraisers.”

 “ ‘Wachovia Fee Letter’ means that certain letter agreement dated on or about May 14, 2008
between the Borrower and Wachovia Capital Finance Corporation (Western).” 
 (q) Schedule 6.5(a), Schedule 6.5(b), Schedule 6.9,
Schedule 6.11, Schedule 6.20, Schedule 6.23 and Schedule 6.24 are replaced in their entirety with new Schedule 6.5(a), new Schedule 6.5(b), new Schedule 6.9, new Schedule 6.11, new Schedule 6.20, new Schedule 6.23 and new Schedule 6.24, attached
hereto as Exhibit A (the “Amended Schedules”). 
 SECTION 2. Conditions of Effectiveness. This Amendment shall become
effective upon the satisfaction of each of the following conditions precedent: 
 (a) The Agent shall have received evidence that this
Amendment has been duly executed and delivered by the Borrower and the Majority Lenders and the Consent annexed hereto executed by the parties thereto. 
 (b) The representations and warranties contained herein and in the Credit Agreement shall be true and correct in all material respects as of the date hereof as if made on the date hereof after giving effect to this
Amendment and the Amended Schedules (except for those which by their terms specifically refer to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date).

 (c) No Default or Event of Default shall have occurred and be continuing after giving effect to this Amendment. 
 SECTION 3. Representations and Warranties of the Borrower. The Borrower hereby represents and warrants to the Agent and the Lenders that, as of
the date hereof and after giving effect to this Amendment and the Amended Schedules, (a) all representations and warranties set forth in the Credit Agreement are true and correct in all material respects as if made again on and as of such date
(except for those which by their terms specifically refer to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date), (b) no Default or Event of Default has
occurred and is continuing and (c) the Credit Agreement (as amended by this Amendment) and all other Loan Documents are and remain legal, valid, binding and enforceable obligations of the Loan Parties in accordance with the terms thereof except
as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles (regardless of whether enforcement is sought in equity or at law).

 SECTION 4. Reference to and Effect on the Loan Documents. 
 (a) On and after the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”,
“hereof” or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment. 
  

 5 

 (b) The Credit Agreement and each of the other Loan Documents, as specifically amended by this Amendment,
are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. Without limiting the generality of the foregoing, the Security Agreement and all of the Collateral described therein do and shall continue
to secure the payment of all Obligations of the Loan Parties under the Loan Documents, in each case as amended by this Amendment. 
 (c) The
execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Agent under any of the Loan Documents, nor constitute a waiver of any
provision of any of the Loan Documents. 
 SECTION 5. Costs and Expenses. Borrower agrees to indefeasibly pay on demand all costs and
expenses of the Agent in connection with the preparation, execution, delivery and administration, modification and amendment of this Amendment and the other instruments and documents to be delivered hereunder (including, without limitation, the
reasonable fees and expenses of counsel for the Agent) in accordance with the terms of Section 13.7 of the Credit Agreement. 
 SECTION
6. Release. In further consideration of the Agent and the Lenders execution of this Amendment, the Borrower for itself and on behalf of its successors, assigns, Subsidiaries and Affiliates (the “Releasing Parties”), hereby
forever releases the Agent and the Lenders and their successors, assigns, parents, Subsidiaries, Affiliates, officers, employees, directors, agents and attorneys (collectively, the “Releasees”) from any and all debts, claims,
demands, liabilities, responsibilities, disputes, causes, damages, actions and causes of action (whether at law or in equity) and obligations of every nature whatsoever, whether liquidated or unliquidated, known or unknown, matured or unmatured,
fixed or contingent (collectively, “Claims”), that any Releasing Party may have against the Releasees that arise from or relate to any actions which the Releasees may have taken or omitted to take prior to the date hereof, including
without limitation with respect to the Obligations, any Collateral, the Credit Agreement, any other Loan Document and any third parties liable in whole or in part for the Obligations. 
 SECTION 7. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment by telecopier
shall be effective as delivery of a manually executed counterpart of this Amendment. 
 SECTION 8. Governing Law. This Amendment shall
be governed by, and construed in accordance with, the laws of the State of California. 
 [Remainder of this page intentionally left blank]

  

 6 

 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective
officers thereunto duly authorized, as of the date first above written. 
  

			
	LEAPFROG ENTERPRISES, INC.
		
	By:	 	/s/ William B. Chiasson
		 	    Name: William B. Chiasson
		 	    Title: Chief Financial Officer

  

			
	BANK OF AMERICA, N.A., as the Agent
		
	By:	 	/s/ Steven W. Sharp
		 	    Name: Steven W. Sharp
		 	    Title: Vice President

  

			
	BANK OF AMERICA, N.A., as a Lender
		
	By:	 	/s/ Steven W. Sharp
		 	    Name: Steven W. Sharp
		 	    Title: Vice President

 Signature Page to Amendment No. 1 to Credit Agreement 

 CONSENT 
 Dated as of May 15, 2008 
 We, the undersigned, as Guarantors under the Subsidiary Guaranty and the
Security Agreement (each as defined in the Credit Agreement) in favor of the Agent and, for its benefit and the benefit of the Lenders party to the Credit Agreement referred to in the foregoing Amendment No. 1 to the Credit Agreement (the
“Amendment”), hereby consent to such Amendment and hereby confirm and agree that notwithstanding the effectiveness of such Amendment, the Subsidiary Guaranty and Security Agreement are, and shall continue to be, in full force and
effect and are hereby ratified and confirmed in all respects, except that, on and after the effectiveness of such Amendment, each reference in the Guaranty, Subsidiary Guaranty, Security Agreement, Intellectual Property Security Agreement and Pledge
Agreement to “Credit Agreement”, “thereunder”, “thereof”, or words of like import shall mean and be a reference to the Credit Agreement, as amended by such Amendment. 
  

			
	LFC VENTURES, LLC
		
	By:	 	/s/ William B. Chiasson
		 	    Name: William B. Chiasson
		 	    Title: Chief Financial Officer

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