Document:

EXHIBIT 4.1

                SECOND AMENDMENT TO CREDIT AND SECURITY AGREEMENT

         This Amendment,  dated as of February 7, 2001, is made by and among The
Leather Factory,  Inc., a Delaware  corporation,  The Leather  Factory,  Inc., a
Texas corporation,  The Leather Factory, Inc., an Arizona corporation,  Roberts,
Cushman & Company, Inc., a New York corporation, Hi-Line Leather & Manufacturing
Company, a California  corporation,  and Leather Tan Acquisition,  Inc., a Texas
corporation  (collectively,  the  "Borrowers")  and Wells Fargo Business Credit,
Inc., a Minnesota corporation (the "Lender").

                                    Recitals
                                    --------

       The  Borrowers  and the Lender have  entered  into a Credit and  Security
Agreement  dated as of November  22, 1999,  and a First  Amendment to Credit and
Security  Agreement  dated  as of  November  30,  2000 (as so  supplemented  and
amended, the "Credit Agreement").

       The  Borrowers  have  requested  that certain  amendments  be made to the
Credit Agreement,  which the Lender is willing to make pursuant to the terms and
conditions set forth herein.

       ACCORDINGLY, the parties hereto hereby agree as follows:

       1.     Defined Terms.  Capitalized terms used in this Amendment which are
              defined in the Credit  Agreement  shall have the same  meanings as
              defined  therein,  unless otherwise  defined herein.  In addition,
              Section  1.1 of the  Credit  agreement  is  amended  by  adding or
              amending, as the case may be, the following definitions:

       "'Borrowing Base' means, at any time the lesser of:

               (a)  the Maximum Line; or

               (b)  subject  to change  from time to time in the  Lender's  sole
                    discretion, the sum of:

                    (i)  85% of Eligible Accounts, plus
                    (ii) the lesser of (A) the Eligible  Inventory  Advance Rate
                         times Eligible  Inventory or (B) the Eligible Inventory
                         Cap, plus
                    (iii) the Special Accommodation Component."

       "'Default Rate' means, with respect to the Revolving  Advances other than
Special Accommodation  Advances, an annual rate equal to three percent (3%) over
the Revolving  Floating Rate,  which rate shall change when and as the Revolving
Floating Rate changes,  with respect to the Term Advances,  an annual rate equal
to three percent (3%) over the Term Floating Rate,  which rate shall change when
and as  the  Term  Floating  Rate  changes,  and  with  respect  to the  Special
Accommodation  Advances,  an annual  rate equal to three  percent  (3%) over the
Special  Accommodation  Floating  Rate,  which rate shall change when and as the
Special Accommodation Floating Rate changes."

                                       17
<PAGE>

       "'Special  Accommodation  Advances'  means the portion of the outstanding
Revolving  Advances  that is less  than or  equal to the  Special  Accommodation
Component."

       "'Special Accommodation  Component' means during each month listed below,
the amount set forth across from it:

          ------------------------------------------------ ---------------------
                             Month                                Amount
          ------------------------------------------------ ---------------------
                         February 2001                           $300,000
          ------------------------------------------------ ---------------------
                           March 2001                            $250,000
          ------------------------------------------------ ---------------------
                           April 2001                            $200,000
          ------------------------------------------------ ---------------------
                            May 2001                             $150,000
          ------------------------------------------------ ---------------------
                           June 2001                             $100,000
          ------------------------------------------------ ---------------------
                           July 2001                             $50,000
          ------------------------------------------------ ---------------------
                 August 1, 2001 and thereafter                     $0"
          ------------------------------------------------ ---------------------

       "'Special  Accommodation Floating Rate' means an annual rate equal to the
sum of the Prime Rate plus one and one half  percent  (1.5%),  which annual rate
shall change when and as the Prime Rate changes."

       2.     Revolving Note.  Section 2.9(a) of the Credit  Agreement is hereby
              amended to read as follows:

                     "(a) Revolving Note. Except as set forth in Sections 2.9(d)
              and 2.9(f), the portion of the outstanding Revolving Advances that
              is not a Special  Accommodation Advance shall bear interest at the
              Revolving  Floating  Rate and the Special  Accommodation  Advances
              shall bear interest at the Special Accommodation Floating Rate."

       3.     No Waiver of Default. The execution and delivery of this Amendment
              does not  constitute  a waiver  of any  Event of  Default  and the
              Lender  reserves  the right to enforce  its  rights  and  remedies
              provided  in the Credit  Agreement  including  its right to charge
              interest at the  Default  Rate from the  beginning  of the Default
              Period.

       4.     No Other Changes.  Except as explicitly amended by this Amendment,
              all of the terms and  conditions  of the  Credit  Agreement  shall
              remain in full force and effect and shall  apply to any advance or
              letter of credit thereunder.

       5.     Fee.  The  Borrowers  shall pay to the  Lender a fully  earned and
              non-refundable fee of $3,000 due and payable upon the execution of
              this Amendment.

       6.     Conditions  Precedent.  This Amendment shall be effective when the
              Lender shall have received an executed  original hereof,  together
              with each of the following,  each in substance and form acceptable
              to the Lender in its sole discretion:

              (a)    The  Acknowledgement  and Agreement of Guarantors set forth
                     at  the  end of  this  Amendment,  duly  executed  by  each
                     Guarantor.

                                       18
<PAGE>

              (b)    A certificate of the Secretary of the Borrowers  certifying
                     as to (i) the resolutions of the boards of directors of the
                     Borrowers  approving  the  execution  and  delivery of this
                     Amendment, (ii) the fact that the articles of incorporation
                     and  bylaws  of  the  Borrowers,   which  were   previously
                     certified  and  delivered  to the  Lender  pursuant  to the
                     Certificates  of Authority of the  Borrowers'  secretary or
                     assistance  secretary  each dated as of  November 22, 1999,
                     continue in full force and effect and have not been amended
                     or   otherwise   modified   except  as  set  forth  in  the
                     Certificate to be delivered,  and (iii) certifying that the
                     officers  and  agents  of  the   Borrowers  who  have  been
                     certified to the Lender,  pursuant to the  Certificates  of
                     Authority  of  the   Borrowers'   secretary  or  assistance
                     secretary  each dated as of  November  22,  1999,  as being
                     authorized  to sign and to act on behalf  of the  Borrowers
                     continue to be so  authorized  or setting  forth the sample
                     signatures  of  each  of the  officers  and  agents  of the
                     Borrowers  authorized to execute and deliver this Amendment
                     and all other  documents,  agreements and  certificates  on
                     behalf of the Borrowers.
              (c)    Payment of the fee as described in paragraph 5 hereof.
              (d)    Such other matters as the Lender may require.

       7.     Representations and Warranties. The Borrowers hereby represent and
              warrant to the Lender as follows:

              (a)    The  Borrowers  have all  requisite  power and authority to
                     execute  this   Amendment  and  to  perform  all  of  their
                     obligations  hereunder and under the Loan Document and this
                     Amendment has been duly executed and delivered on behalf of
                     the Borrowers and constitutes the legal,  valid and binding
                     agreement  of the  Borrowers,  enforceable  against them in
                     accordance with its terms.
              (b)    The execution, delivery and performance by the Borrowers of
                     the  Amendment  has been duly  authorized  by all necessary
                     action and does not (i) require any authorization,  consent
                     or approval  by any  governmental  department,  commission,
                     board,  bureau,  agency  or  instrumentality,  domestic  or
                     foreign  (ii)  violate any  provision  of any law,  rule or
                     regulation  or of any  order,  writ,  injunction  or decree
                     presently in effect, having applicability to the Borrowers,
                     or  the   organizational   agreements   applicable  to  the
                     Borrowers,  or (iii) result in a breach of or  constitute a
                     default  under any  indenture  or credit  agreement  or any
                     other agreement,  lease or instrument to which any Borrower
                     is a party or by which any  properties  of any Borrower may
                     be bound or affected.

              (c)    All of the  representations  and  warranties  contained  in
                     Article V of the Credit  Agreement are correct on and as of
                     the date  hereof  as  though  made on and as of such  date,
                     except  to  the  extent  that  such   representations   and
                     warranties relate solely to an earlier date.

       8.     References.  All  references  in the  Credit  Agreement  to  "this
              Agreement"  shall be deemed to refer to the  Credit  Agreement  as
              amended  hereby;  and any and all references in the Loan Documents
              hereto  to the  Credit  Agreement  shall be deemed to refer to the
              Credit Agreement as amended hereby.

                                       19
<PAGE>

       9.     Release.  The  Borrowers  and  each  Guarantor,   by  signing  the
              Acknowledgment and Agreement of Guarantors set forth below, hereby
              absolutely and  unconditionally  release and forever discharge the
              Lender,  and  any  and  all  participants,   parent  corporations,
              subsidiary,   affiliated  corporations,   insurers,   indemnitors,
              successors  and  assigns,  together  with all of the  present  and
              former  directors,  officers,  agents and  employees of any of the
              foregoing, from any and all claims, demands or causes of action of
              any kind, nature or description,  whether arising in law or equity
              or upon  contract  or tort or under  any state or  federal  law or
              otherwise,  which any of the Borrowers or such  Guarantor has had,
              or now has, or has made claim to have  against any such person for
              or by  reason  of  any  act,  omission,  matter,  cause  or  thing
              whatsoever arising from the beginning of time to and including the
              date of this Amendment,  whether such claims demands and causes of
              action are matured or unmatured or known or unknown.

       10.    Costs and Expenses.  The Borrowers hereby reaffirm their agreement
              under the  Credit  Agreement  to pay or  reimburse  the  Lender on
              demand  for all  costs  and  expenses  incurred  by the  Lender in
              connection  with  the  Loan  Documents  and  all  other  documents
              contemplated thereby,  including without limitation all reasonable
              fees and  disbursements  of legal  counsel.  Without  limiting the
              generality of the foregoing,  the Borrowers  specifically agree to
              pay all fees and  disbursements  of  counsel to the Lender for the
              services   performed  by  such  counsel  in  connection  with  the
              preparation  of this  Amendment and the documents and  instruments
              incidental hereto. The Borrowers hereby agree that the Lender may,
              at any  time or from  time to  time  in its  sole  discretion  and
              without further  authorization by the Borrowers,  make a Revolving
              Advance to the  Borrowers,  or apply the proceeds of any loan, for
              the  purpose  of paying any such  fees,  disbursements,  costs and
              expenses.

       11.    Counterparts.  This Amendment and the Acknowledgment and Agreement
              of Guarantors may be executed in any number of counterparts,  each
              of  which  when so  executed  and  delivered  shall be  deemed  an
              original  and all of which  counterparts,  taken  together,  shall
              constitute one in the same instrument.

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

WELLS FARGO BUSINESS CREDIT, INC.     THE LEATHER FACTORY, INC., a Delaware
                                      corporation, THE LEATHER FACTORY, INC., an
                                      Arizona corporation, THE LEATHER FACTORY,
By   /s/ Thomas Kruger                INC., a Texas corporation, ROBERTS,
     -----------------                CUSHMAN &  COMPANY, INC., HI-LINE LEATHER
     Thomas Krueger                   & MANUFACTURING COMPANY, TANDY LEATHER
     Its Vice President               COMPANY, INC. f/k/a Leather Tan
                                      Acquisition, Inc.

                                            By  /s/Wray Thompson
                                            --------------------
                                                 Wray Thompson
                                                 Its President

                                       20EXHIBIT 4.2

                THIRD AMENDMENT TO CREDIT AND SECURITY AGREEMENT
                             AND WAIVER OF DEFAULTS

              This  Amendment,  dated as of June 14, 2001,  is made by and among
The Leather Factory, Inc., a Delaware corporation;  The Leather Factory, Inc., a
Texas corporation;  The Leather Factory, Inc., an Arizona corporation;  Roberts,
Cushman & Company, Inc., a New York corporation; Hi-Line Leather & Manufacturing
Company,  a California  corporation;  and Tandy Leather  Company,  Inc., a Texas
corporation f/k/a Leather Tan Acquisition, Inc. (collectively, the "Borrowers"),
and Wells Fargo Business Credit, Inc., a Minnesota corporation (the "Lender").

                                    Recitals
                                    --------

       The  Borrowers  and the Lender have  entered  into a Credit and  Security
Agreement  dated as of  November  22,  1999,  a First  Amendment  to Credit  and
Security  Agreement  dated as of November  30, 2000,  and a Second  Amendment to
Credit and Security  Agreement  dated as of February 7, 2001 (as so supplemented
and amended, the "Credit Agreement").

       The  Borrowers  have  requested  that certain  amendments  be made to the
Credit Agreement and certain Events of Default be waived.  The Lender is willing
to grant the Borrowers'  requests pursuant to the terms and conditions set forth
herein.

       ACCORDINGLY, the parties hereto hereby agree as follows:

1. Defined Terms.  Capitalized terms used in this Amendment which are defined in
the Credit  Agreement  shall have the same meanings as defined  therein,  unless
otherwise  defined herein.  In addition,  Section 1.1 of the Credit Agreement is
amended by adding or amending, as the case may be, the following definitions:

              "`Revolving Floating Rate' means an annual rate equal to the Prime
       Rate, which annual rate shall change when and as the Prime Rate changes."

2. Audit Fees.  Section  2.10 (f) of the Credit  Agreement is amended to read as
follows:

       "(f) Audit Fees. The Borrowers shall pay to the Lender, on demand,  audit
       fees in  connection  with any  audits  or  inspections  conducted  by the
       Lender,  or any third party on behalf of the Lender, of any Collateral or
       the Borrowers'  operations or business at the rates established from time
       to time by the Lender as its audit fees  (which fees are  currently  $600
       per day per auditor),  together with all reasonable  out-of-pocket  costs
       and  expenses  incurred  in  conducting  any such  audit  or  inspection;
       provided, however, that except during Default Periods, the Borrower shall
       not have to  reimburse  the  Lender  for such  fees,  costs and  expenses
       incurred in  connection  with more than (i) two audits  conducted  by the
       Lender per fiscal year and (ii) two audits  conducted by a third party on
       behalf of the Lender per fiscal year."

3. New  Covenants.  Section 6.15 of the Credit  Agreement is amended by deleting
the date  "December 31, 2000" and inserting  the phrase  "December  31st of each
year".

                                       21
<PAGE>

4. Financial Covenant. Section 7.11 of the Credit Agreement is hereby amended in
its entirety to read as follows:

              "Section 7.11 Capital  Expenditures.  The Borrowers will not incur
       or contract to incur  Capital  Expenditures  of more than $650,000 in the
       aggregate  during the fiscal year ending  December 31, 2001, and not more
       than $500,000 in the aggregate during any fiscal year thereafter."

5. Waiver of Defaults.  The Borrower is in default of the following provision of
the Credit Agreement (the "Existing Default"):

       ---------------------- ------------------- --------------- -------------
               Covenant               Date           Required         Actual
       ---------------------- ------------------- --------------- -------------
        Section 7.11 Capital   December 31, 2001   not more than   $513,890.91
        Expenditures                               $500,000
       ---------------------- ------------------- --------------- -------------

Upon the terms and subject to the  conditions set forth in this  Amendment,  the
Lender hereby waives the Existing  Default.  This waiver shall be effective only
in this  specific  instance and for the specific  purpose for which it is given.
This waiver shall not entitle the Borrower to any other or further waiver in any
similar or other circumstances.

6. No Other Changes. Except as explicitly amended by this Amendment,  all of the
terms and  conditions  of the Credit  Agreement  shall  remain in full force and
effect and shall apply to any advance or letter of credit thereunder.

7. Conditions Precedent. This Amendment shall be effective when the Lender shall
have received an executed original hereof,  together with each of the following,
each in substance and form acceptable to the Lender in its sole discretion:

       (a) The  Acknowledgment  and Agreement of Guarantors set forth at the end
of this Amendment, duly executed by each Guarantor.

       (b) A Certificate of the Secretary of the Borrowers  certifying as to (i)
the  resolutions  of the boards of  directors  of the  Borrowers  approving  the
execution  and  delivery of this  Amendment,  (ii) the fact that the articles of
incorporation and bylaws of the Borrowers,  which were previously  certified and
delivered  to the  Lender  pursuant  to the  Certificates  of  Authority  of the
Borrowers'  secretary or assistant secretary each dated as of November 22, 1999,
continue  in full  force  and  effect  and have not been  amended  or  otherwise
modified  except  as set forth in the  Certificate  to be  delivered,  and (iii)
certifying that the officers and agents of the Borrowers who have been certified
to the Lender,  pursuant to the  Certificates  of  Authority  of the  Borrowers'
secretary or assistant  secretary  each dated as of November 22, 1999,  as being
authorized  to sign and to act on  behalf  of the  Borrowers  continue  to be so
authorized  or setting  forth the sample  signatures of each of the officers and
agents of the Borrowers authorized to execute and deliver this Amendment and all
other documents, agreements and certificates on behalf of the Borrowers.

       (c) Such other matters as the Lender may require.

                                       22
<PAGE>

8. Representations and Warranties. The Borrowers hereby represent and warrant to
the Lender as follows:

       (a) The Borrowers have all requisite  power and authority to execute this
Amendment and to perform all of their  obligations  hereunder and under the Loan
Documents  and this  Amendment has been duly executed and delivered on behalf of
the  Borrowers and  constitutes  the legal,  valid and binding  agreement of the
Borrowers, enforceable against them in accordance with its terms.

       (b) The  execution,  delivery and  performance  by the  Borrowers of this
Amendment  has been duly  authorized  by all  necessary  action and does not (i)
require any authorization,  consent or approval by any governmental  department,
commission,  board, bureau, agency or instrumentality,  domestic or foreign (ii)
violate any  provision of any law,  rule or  regulation  or of any order,  writ,
injunction or decree presently in effect, having applicability to the Borrowers,
or the organizational agreements applicable to the Borrowers, or (iii) result in
a breach of or constitute a default  under any indenture or credit  agreement or
any other agreement,  lease or instrument to which any Borrower is a party or by
which any properties of any Borrower may be bound or affected.

       (c) All of the representations  and warranties  contained in Article V of
the Credit  Agreement are correct on and as of the date hereof as though made on
and as of  such  date,  except  to the  extent  that  such  representations  and
warranties relate solely to an earlier date.

9. No Waiver of Default.  Except as set forth in paragraph  5, the  execution of
this  Amendment  and  acceptance of any  documents  related  hereto shall not be
deemed to be a waiver  of any  Default  or Event of  Default  under  the  Credit
Agreement or breach,  default or event of default under any Security Document or
other  document  held by the  Lender,  whether  or not known to the  Lender  and
whether or not existing on the date of this Amendment.

10. References. All references in the Credit Agreement to "this Agreement" shall
be deemed to refer to the Credit  Agreement as amended  hereby;  and any and all
references in the Loan Documents  hereto to the Credit Agreement shall be deemed
to refer to the Credit Agreement as amended hereby.

11. Release. The Borrowers and each Guarantor, by signing the Acknowledgment and
Agreement of Guarantors set forth below,  hereby absolutely and  unconditionally
release and forever discharge the Lender,  and any and all participants,  parent
corporations,   subsidiary,  affiliated  corporations,   insurers,  indemnitors,
successors and assigns,  together with all of the present and former  directors,
officers, agents and employees of any of the foregoing, from any and all claims,
demands or causes of action of any kind, nature or description,  whether arising
in law or equity or upon  contract  or tort or under any state or federal law or
otherwise,  which any of the Borrowers or such Guarantor has had, or now has, or
has made  claim to have  against  any such  person  for or by reason of any act,
omission,  matter,  cause or thing whatsoever arising from the beginning of time
to and including  the date of this  Amendment,  whether such claims  demands and
causes of action are matured or unmatured or known or unknown.

12. Costs and Expenses.  The Borrowers hereby reaffirm their agreement under the
Credit  Agreement  to pay or  reimburse  the  Lender on demand for all costs and
expenses  incurred by the Lender in connection  with the Loan  Documents and all
other  documents   contemplated   thereby,   including  without  limitation  all
reasonable  fees  and  disbursements  of legal  counsel.  Without  limiting  the
generality of the foregoing,  the Borrowers  specifically  agree to pay all fees
and  disbursements  of counsel to the Lender for the services  performed by such
counsel in connection  with the  preparation of this Amendment and the documents
and instruments  incidental  hereto.  The Borrowers hereby agree that the Lender
may, at any time or from time to time in its sole discretion and without further
authorization by the Borrowers,  make a Revolving  Advance to the Borrowers,  or
apply the  proceeds  of any loan,  for the  purpose  of  paying  any such  fees,
disbursements, costs and expenses.

                                       23
<PAGE>

13.  Counterparts.  This  Amendment  and the  Acknowledgment  and  Agreement  of
Guarantors may be executed in any number of counterparts,  each of which when so
executed  and   delivered   shall  be  deemed  an  original  and  all  of  which
counterparts, taken together, shall constitute one in the same instrument.

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

WELLS FARGO BUSINESS CREDIT, INC.     THE LEATHER FACTORY, INC., a Delaware
                                      corporation, THE LEATHER FACTORY, INC., an
By  /s/ Thomas Krueger                Arizona corporation, THE LEATHER FACTORY,
    ------------------                INC., a Texas corporation, ROBERTS,
     Thomas Krueger                   CUSHMAN &  COMPANY, INC., HI-LINE LEATHER
     Its Vice President               & MANUFACTURING COMPANY, TANDY LEATHER
                                      COMPANY, INC. f/k/a Leather Tan
                                      Acquisition, Inc.

                                      By  /s/ Wray Thompson
                                         ------------------
                                         Wray Thompson
                                         Its President

                                       24

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