Document:

Exhibit 10.1

                     TERMINATION AGREEMENT AND GENERAL RELEASE

      This Termination  Agreement and General Release  ("Agreement") is made and
entered into this 20 day of March,  2006 (the "Effective  Date"), by and between
Brainstorm Cell Therapeutics Ltd.  ("Brainstorm  Ltd."), a company  incorporated
under the laws of the State of Israel and  maintaining  its  principal  place of
business at Petach Tikva, Israel, Brainstorm Cell Therapeutics  Inc.("Brainstorm
Inc."),  a company  incorporated  under the laws of the State of Washington  and
maintaining its principal place of business at 1350 Avenue of the Americas,  New
York, NY 10019  (hereinafter  Brainstorm Ltd. and Brainstorm  Inc.,  jointly and
severally,  collectively  referred  to as the  "Company"),  and Dr.  Yaffa Beck,
Israeli I.D. number 0-5103711-7,  residing at 7 Gallillee St., Tel-Aviv,  Israel
("Executive")  (hereinafter  collectively  referred to as the "Parties" and each
individually a "Party").

                                    RECITALS

      WHEREAS,  Executive  was hired by the Company as its  President  and Chief
Executive  Officer  pursuant to an employment  agreement  dated November 8, 2004
(the "Employment Agreement"); and

      WHEREAS,  on December 31, 2004, Company granted Executive stock options to
purchase 1,828,692 shares of the Company's Common Stock, at a price per share of
$0.15,  which  options  shall be issued  under the  Company's  2004 Global Share
Option Plan (the "Plan") and will vest and become exercisable in thirty six (36)
equal monthly installments beginning on November 8, 2004; and

      WHEREAS, on November 10, 2005 the Executive resigned from her positions as
President and Chief Executive Officer of the Company; and

      WHEREAS,  the  Company  and  Executive  have  agreed  to  terminate  their
employment relationship effective February 9, 2006; and

      WHEREAS, the Parties desire to resolve any potential disputes between them
with respect to any fact or circumstance known or unknown to them as of the date
hereof.

      NOW  THEREFORE,  in  consideration  of the covenants  and  representations
contained herein, the Parties hereto agree as follows:

1)    TERMINATION.

      a)    The parties  hereof  mutually agree and covenant that the employment
            of Executive by the Company is hereby  terminated  as of February 9,
            2006 (hereinafter the "Termination Date").

      b)    As of the  Termination  Date,  Executive shall cease to benefit from
            any benefit plan, program, contract or practice by either Brainstorm
            Cell Therapeutics Ltd. or Brainstorm Cell Therapeutics Inc. and such
            shall  terminate ipso facto with the  termination of her employment,
            except as otherwise specifically provided herein.

2)    PAYMENTS UPON TERMINATION.

<PAGE>

      a)    In exchange  for  Executive's  agreement to be bound by the terms of
            this entire  Agreement,  including but not limited to the Release of
            Claims in Section 3, the  Company  agrees to pay the  Executive  the
            following payments and grant the Executive the following rights:

            (1)   An  aggregate   gross   payment  of  $47,355,   calculated  in
                  accordance  with the table attached hereto as Appendix A, from
                  which all applicable  statutory  deductions  and  withholdings
                  under  Israeli law will be made,  which  payment shall be paid
                  out in 9 monthly equal installments of $5,000 each starting on
                  March  1,  2006  and one  installment  of  $2,355  payable  on
                  December  1,  2006.  In the event that the  Company  raises an
                  aggregate   of   $1,000,000   through   an  equity   financing
                  transaction in one or more series of transactions  (the "Major
                  Investment") at any time after the Termination  Date but prior
                  to  full  payment  of  the  amount  hereof,   the  then  total
                  outstanding  amount due pursuant to this  subsection  shall be
                  paid  out  to  Executive  within  fifteen  (15)  days  of  the
                  Company's receipt of the aggregate proceeds (i.e.  $1,000,000)
                  from the Major  Investment,  in one  "lump-sum"  payment.  The
                  Company shall pay the aforementioned  sums plus the applicable
                  VAT against the receipt of a tax invoice  from  Executive.  If
                  the payments are  remitted in NIS,  payments  shall be made in
                  accordance  with the  representative  rate of  exchange of the
                  U.S.  Dollar  against  the NIS last  published  by the Bank of
                  Israel  immediately  prior  to  the  date  of  payment  of the
                  respective installment.

            (2)   Out of the  total  number of  options  granted  to  Executive,
                  options  to  acquire  800,000  shares of  Common  Stock of the
                  Company at an  exercise  price of $0.15 per share (the  "Stock
                  Options")  shall be vested and  exercisable for four (4) years
                  from  the   Termination   Date.   Executive   has  no  rights,
                  contractual  or  otherwise,  to any  additional  shares of the
                  Company,  options,  or  rights  to  receive  or  purchase  any
                  security or instrument  of the Company.  Any other options are
                  hereby forfeited to the Company and therefore unexercisable as
                  of the date hereof.  The Option  Agreement  dated December 31,
                  2004 between Company and Executive (the "Option Agreement") is
                  hereby  amended  and  revised by  reference.  In the event the
                  Company  registers  shares for other  employees of the Company
                  under an S-8  registration  or otherwise,  the Company  hereby
                  undertakes  to register  the Stock  Options in the same manner
                  and under the same terms and  conditions,  as those offered to
                  management.

            (3)   A special  conditional one time bonus of $30,000 (the "Bonus")
                  shall  be paid to the  Executive  only in the  event  that the
                  Company  is granted  one of the EC  research  and  development
                  grants described in the grant applications  attached hereto as
                  Appendix B or any amendment thereof (collectively the "Grants"
                  and each individually a "Grant").  The time of payment of such
                  Bonus shall be on the earlier of: (i) fifteen (15) days of the
                  receipt by  Company of an initial  payment of such EC grant of
                  at least  $50,000 or (ii) fifteen  (15) days of the  Company's
                  receipt of the aggregate  proceeds (i.e.  $1,000,000) from the
                  Major Investment. The Company shall pay the aforementioned sum
                  plus the  applicable  VAT against the receipt of a tax invoice
                  from Executive.

            (4)   On the  Effective  Date,  all rights and sums  accumulated  in
                  Executive's  Manager's  Insurance  Policy  no.  _________  and
                  Continuing  Education  Fund (as such terms are  defined in the
                  Employment  Agreement)  shall be released and  transferred  to
                  Executive,  and the Company shall sign  standard  confirmation
                  and  transfer  approvals  to the  applicable  insurer  to that
                  effect.

<PAGE>

      b)    Executive  acknowledges  that the amounts set forth in this  Section
            constitute  valid  and  sufficient   consideration  for  Executive's
            release of claims and other  obligations  set forth  herein.  In the
            event that none of the Grants is received,  Executive  hereby waives
            any rights to payment of said Bonus and/or  interest  and/or penalty
            of relief  in  respect  of the  non-payment  thereof.  If any of the
            Grants is deferred (in terms of time),  Executive  hereby waives any
            interest  and/or  penalty  of  relief  in  respect  of the  deferral
            thereof. Executive further acknowledges that the Stock Options shall
            be  governed  by the  applicable  terms of the  Plan and the  Option
            Agreement as in effect on the date hereof,  as much as such have not
            been  revised  and  amended by  reference  in  respect  of  specific
            provisions   provided  in  this  Section,   provided  however,   any
            amendments to the Plan that impair the rights of the Executive shall
            require  the mutual  prior  written  consent of the  Company and the
            Executive. In the event of contradiction between this Agreement, the
            Plan, and the Option  Agreement,  the terms of this Agreement  shall
            govern.

3)    MUTUAL RELEASE OF CLAIMS

      a)    In exchange  for the actual  receipt by Executive of all the amounts
            and  benefits  described in Section 2, the  sufficiency  of which is
            hereby  acknowledged,  the  Executive,  on behalf of herself and her
            representatives,  dependents,  heirs, executors,  administrators and
            assigns  (hereinafter  collectively  referred  to  as  "Executive"),
            hereby expressly,  absolutely, and unconditionally waives, releases,
            remises,  acquits  and  forever  discharges,  indemnifies  and holds
            harmless the Company and its  divisions,  subsidiaries,  affiliates,
            parents,   related   entities,   officers,   directors,   employees,
            stockholders, attorneys and/or agents, predecessors,  successors and
            assigns, all both individually, in their capacities acting on behalf
            of  the  Company   and  their   official   capacities   (hereinafter
            collectively referred to as "Company  Releasees"),  from any and all
            actions or causes of action, suits, claims,  complaints,  contracts,
            liabilities, agreements, promises, contracts, torts, debts, damages,
            controversies,  judgments,  rights and demands  ("Claims"),  whether
            existing or contingent,  known or unknown, suspected or unsuspected,
            which  arise out of or are  related  to  Executive's  employment  or
            termination  from  employment  with  the  Company.  As  used in this
            Section 3, Claims  include,  but are not limited to, claims based on
            the Employment Agreement,  fraud, stock fraud, defamation,  wrongful
            termination,      negligent      misrepresentation,      intentional
            misrepresentation, breach of contract, express or implied, estoppel,
            equity, tort,  retaliation,  discrimination,  intellectual property,
            personal injury, spoliation of evidence,  emotional distress, public
            policy,  wage and hour  laws,  statute  or common  law,  claims  for
            severance pay, claims related to stock options or stock,  claims for
            attorneys'  fees,  vacation  pay,  debts,   accounts,   compensatory
            damages, punitive or exemplary damages, and liquidated damages. This
            release is intended by Executive to be all  encompassing  and to act
            as a  full  and  total  release  of  any  and  all  Claims,  whether
            specifically  enumerated  herein or not, that  Executive may have or
            have  had  against  the  Company   Releasees  arising  from  conduct
            occurring up to and including the date of this Agreement, including,
            but not limited to, (i) any claims  arising out of or related to any
            applicable law,  including,  without  limitation,  law,  regulation,
            ordinance,  or rule prohibiting  discrimination  on account of race,
            color,  sex,  age,  religion,  sexual  orientation,   disability  or
            national  origin,  marital  status,   pregnancy,   national  origin,
            ancestry,  mental or  physical  handicap  or  disability,  alienage,
            genetic  predisposition  or carrier  status,  whistleblower  status,
            including  but not limited to, the New York Human  Rights Law,  N.Y.
            Exec.  Law,  Art.  15, ss. 290 et seq.,  and the New York  Rights of
            Persons With A Disability  Law,  N.Y.  Civil Rts.  Law,  Art. 4-B et
            seq., all as amended; the New York Equal Rights Law, as amended; the
            New  York  City  Administrative  Code,  the  Age  Discrimination  in
            Employment  Act,  Title  VII of the  Civil  Rights  Act of  1964  as
            amended, the Americans with Disabilities Act, the Family and Medical
            Leave Act or the Executive  Retirement  Income  Security Act (except
            for  rights  that  cannot  be waived by law);  the  applicable  laws
            relating to workers  compensation,  family and medical leave, or any
            other  applicable  human  rights  or  employment  law or  any  other
            applicable  law,  regulation,   rule  or  ordinance;  and  (ii)  the
            Company's stock. Anything herein to the contrary  notwithstanding in
            this  Agreement,  nothing  herein  shall  release any of the Company
            Releasees  from  (i) any  right or claim  based  on any  right  that
            Executive has to enforce this Agreement, (ii) any right or claim for
            unemployment  payment;  (iii)  any  right or claim  based on  events
            occurring after the Effective Date, or (iv) any right that Executive
            has under the Plan with respect to the Stock Options that are vested
            pursuant to Section 2. The Executive  represents and warrants to the
            Company  that she is not aware of any  claims she may have under the
            Plan with respect to the Stock  Options that are vested  pursuant to
            Section 2.

<PAGE>

      b)    Executive  further  agrees to  release  and  discharge  the  Company
            Releasees  from any and all  claims  that might be made by any other
            person or  organization  on the  Executive's  behalf  and  Executive
            specifically waives any right to become, and promises not to become,
            a member of any  class in a case in which a claim or claims  against
            the  Company  are made  involving  any  matters  subject  to release
            pursuant to Section 3.

      c)    As a  terminating  employee  who chooses to accept the terms of this
            Agreement and a Company  accepting  the terms  hereof,  each Party e
            represents and warrants to the other that it does not presently have
            on file and further  represents and warrants that it will never file
            a lawsuit asserting any Claim against the other Released Parties (as
            defined below),  that arises from or is related to any claim that is
            within  the scope of the  release  in  Section 3 against  any of the
            other  Released  Parties  in or with  any  administrative,  state or
            governmental entity, agency, authority board or court, or before any
            other tribunal or panel or  arbitrators,  public or private.  Either
            Party's  failure to comply with this  provision  shall  constitute a
            breach of the Agreement.  Each Party also agrees that,  except as is
            required by applicable law, it will not assist or cooperate with any
            third  party with any claims,  lawsuits or causes of action  against
            the other Released Parties  relating to events or matters  occurring
            prior to the date hereof.

      d)    Each of Brainstorm Ltd. and Brainstorm Inc.,  jointly and severally,
            on  their  behalf  and  their  divisions,   subsidiaries,   parents,
            officers,  and  directors  solely in their  capacities  as acting on
            behalf of the Company,  (hereinafter collectively referred to as the
            "Company"),   hereby  expressly,   absolutely,  and  unconditionally
            waives,   releases,   remises,   acquits  and  forever   discharges,
            indemnifies  and holds  harmless the  Executive,  as defined in this
            Section 3, and any company  under her control and its  employees and
            directors  (hereinafter   collectively  referred  to  as  "Executive
            Releasees"),   from  any  and  all  Claims,   whether   existing  or
            contingent, known or unknown, suspected or unsuspected,  which arise
            out of or are related to Executive's  employment or termination from
            employment  with  the  Company.  As used in this  paragraph,  Claims
            include,  but are not limited to, claims based on the performance of
            Executive's duties in her capacities in the Company. This release is
            intended by the Company to be all  encompassing and to act as a full
            and  total  release  of any and  all  Claims,  whether  specifically
            enumerated  herein  or not,  that the  Company  may have or have had
            against the Executive Releasees arising from conduct occurring up to
            and including the date of this Agreement, including, but not limited
            to, (i) any claims arising out of or related to any applicable  law;
            and  (ii) the  Company's  stock.  Anything  herein  to the  contrary
            notwithstanding in this Agreement,  nothing herein shall release any
            of the Executive  Releasees from (i) any right or claim based on any
            right that the Company has to enforce this Agreement, (ii) any right
            or claim based on events occurring after the Effective Date.

<PAGE>

      The Company  Releasees and the Executive  Releasees  shall be collectively
      referred to as the "Released Parties"

4)    ACCORD AND  SATISFACTION.  The actual  receipt by the Executive of all the
      amounts and  benefits  set forth above in Section 2 shall be complete  and
      unconditional payment, settlement, accord and/or satisfaction with respect
      to all obligations and liabilities of the Company  Releasees to Executive,
      including, without limitation, all claims for wages, salary, vacation pay,
      medical leave, draws, incentive pay, bonuses,  recuperation pay, stock and
      stock options, commissions,  severance pay, reimbursement of expenses, any
      and all other forms of compensation or benefits, attorney's fees, or other
      costs or sums.

5)    RECEIPT OF WAGES AND OTHER  COMPENSATION.  Except as otherwise provided in
      Section 2, Executive  acknowledges and agrees that, prior to her execution
      of this Agreement, she has received payment for all wages, salary, accrued
      vacation, and all other compensation owed to Executive by the Company.

6)    COMPANY PROPERTY/PROPRIETARY INFORMATION. Executive undertakes to continue
      to abide by her non-compete, non-solicitation, ownership and protection of
      intellectual property, and proprietary information  undertakings set forth
      in Sections 7 and 8 of the Employment Agreement (the "Undertakings"),  the
      terms of which are incorporated herein by reference and a copy of which is
      attached hereto as Appendix C. Executive agrees and acknowledges  that she
      has  assigned to the Company all her right,  title and  interest in and to
      all developments relating to the business,  technology,  products,  and/or
      services  of the Company and all  related  patents,  patent  applications,
      copyrights and copyright  applications to the maximum extent  permitted by
      law. Executive agrees to cooperate fully with the Company, including after
      her  employment  with the Company,  at the Company's  sole  expense,  with
      respect to the  procurement,  maintenance  and  enforcement of copyrights,
      patents and other intellectual property rights (both in the United States,
      Israel and other countries) relating to such developments. Executive shall
      sign all papers,  including,  without limitation,  copyright applications,
      patent applications,  declarations, oaths, formal assignments, assignments
      of  priority  rights,  and  powers  of  attorney,  which the  Company  may
      reasonably  deem necessary or desirable in order to protect its rights and
      interests  in any  development.  Executive  agrees  that on or before  the
      Termination  Date she will return to the Company all Company  property and
      materials  (whether such materials are originals or copies,  in electronic
      form or  otherwise),  other than one copy retained for archival  purposes,
      including but not limited to, (if applicable)  Company car, Company credit
      cards,  manuals,  building  keys  and  passes,  courtesy  parking  passes,
      diskettes,  intangible information stored on diskettes,  software programs
      and data compiled with the use of those  programs,  software  passwords or
      codes,  tangible  copies of trade  secrets and  confidential  information,
      sales  forecasts,  names and addresses of Company  customers and potential
      customers,  customer lists,  customer contacts,  sales information,  sales
      forecasts,  memoranda,  sales  brochures,  business  or  marketing  plans,
      reports,  projections,  and any  and all  other  information  or  property
      previously or currently  held or used by Executive  that is or was related
      to Executive's employment with the Company ("Company Property"). Executive
      agrees  that in the event  that  Executive  discovers  any  other  Company
      Property in her possession  after the  Termination  Date of this Agreement
      she will immediately return such materials to the Company.

<PAGE>

7)    NON-ADMISSION  OF LIABILITY.  Each Party  understands  and agrees that the
      release  and  accord  and  satisfaction  set  forth  in  Sections  3 and 4
      constitute a final compromise of the claims released  thereby,  and is not
      an admission  by any  Released  Party that any such claims exist and/or of
      liability  by any  Released  Party  with  respect  to such  claims.  It is
      expressly  understood and agreed that nothing  contained in this Agreement
      nor  any of its  terms  and  provisions,  nor any of the  negotiations  or
      proceedings   connected  with  it   constitutes,   will  be  construed  to
      constitute, will be offered in evidence as, received in evidence as and/or
      deemed to be evidence of an admission of  liability or any  wrongdoing  on
      the part of any and/or all of the  Released  Parties.  The release and the
      accord  and  satisfaction  in  Sections 3 and 4 are,  however,  and may be
      asserted by any one or more of the  Released  Parties as an  absolute  and
      final bar to any suit or proceeding  brought by a Party against any one or
      more of the Released Parties; provided, however, that nothing contained in
      this Agreement  shall be construed to prevent an action for breach of this
      Agreement itself.

8)    OWNERSHIP OF CLAIMS.  Each Party  represents  and warrants  that it is the
      sole and lawful  owner of all  rights,  title and  interest  in and to all
      released  matters,  claims and  demands  referred  to herein.  The Parties
      further  represent  and warrant that there has been no assignment or other
      transfer of any  interest in any  matters,  rights,  interests,  claims or
      demands released herein.

9)    CONFIDENTIALITY.  Until and unless this  Agreement  and/or its contents is
      publicly disclosed by the Company,  Executive  understands and agrees that
      this  Agreement,  its  substance,  terms  and  the  matters  discussed  in
      negotiating  its  terms,  are  entirely  confidential.   It  is  therefore
      expressly  understood  and agreed  that,  until  such time as the  Company
      publicly  discloses this  Agreement,  Executive will not reveal,  discuss,
      publish or in any way communicate any of the terms, amount or fact of this
      Agreement to any person,  organization or other entity, with the exception
      of  disclosure  (i) to  her  immediate  family  members  and  professional
      representatives   (including  financial,  tax  and  legal),  (ii)  to  any
      prospective  employer,  but only to the extent  necessary  to inform  such
      employer  of the  Undertakings  regarding  Executive's  ability to perform
      services  for  such  employer;  (iii)  required  by law  or by any  court,
      arbitrator,  mediator or administrative or legislative body (including any
      committee  thereof)  with apparent  jurisdiction  or authority to order or
      require such person to disclose or make  accessible  such  information  or
      (iv) with respect to any  litigation,  arbitration or mediation  involving
      this Agreement. Executive further agrees not to make disparaging, critical
      or otherwise  detrimental  comments to any person or entity concerning the
      Company, its officers,  directors or employees; the products,  services or
      programs provided or to be provided by the Company;  the business affairs,
      operation,  management or the financial  condition of the Company;  or the
      circumstances  surrounding her employment and/or termination of employment
      from the Company. The Company agrees that the Company and its officers and
      directors will not make any disparaging, critical or otherwise detrimental
      comments to any person or entity  concerning  the Executive  personally or
      professionally  nor the  circumstances  surrounding her employment  and/or
      termination  of  employment  from the  Company.  Nothing in this Section 9
      shall  prevent any person from (i) making any  truthful  statement  to the
      extent (x) necessary in connection  with any  litigation,  arbitration  or
      mediation  involving this  Agreement,  including,  but not limited to, the
      enforcement  of this  Agreement  or (y)  required  by law or by any court,
      arbitrator,  mediator or  administrative  or legislative body (including a
      committee  thereof)  with apparent  jurisdiction  or authority to order or
      require such person to disclose or make accessible such information.

<PAGE>

10)   INDEMNIFICATION;  REMEDIES.  Executive  agrees to  indemnify  and hold the
      Company  Releasees  harmless  from and  against  any and all  loss,  cost,
      damage, or expense,  including,  but not limited to, reasonable attorneys'
      fees,  incurred  by the  Company  arising out of any action at law, or any
      other  proceeding,  it  finds  necessary  to  enforce  any of  the  terms,
      covenants or conditions of this Agreement or any other  agreement  between
      Executive and the Company as set forth in Section 16.

      The Company agrees to indemnify and hold the Executive  Releasees harmless
      from and against any and all loss, cost,  damage,  or expense,  including,
      but not limited to, reasonable attorneys' fees, incurred by the Executive,
      as defined in Section 3,  arising  out of any action at law,  or any other
      proceeding,  it finds necessary to enforce any of the terms,  covenants or
      conditions of this Agreement or any other agreement  between Executive and
      the Company as set forth in Section 16.

      In the event of a breach of this Agreement,  then the non-defaulting party
      may seek restitution and/or offset to the extent permitted by law and this
      Agreement in all other respects, including, but not limited to the Release
      provisions  set forth in Section 3, shall remain in full force and effect.
      Also, in the event of a breach or threatened  breach of this  Agreement by
      either Party, the Released Parties shall be able to enforce this Agreement
      by seeking an injunction  and such other relief as may be available at law
      or in equity;  provided,  however,  that the parties expressly acknowledge
      that the non defaulting  party may cancel its Release set forth in Section
      3 and seek enforcement of the rights and obligations  under the Employment
      Agreement.  The Parties expressly  acknowledge and agree that in the event
      of a breach of Section 3 hereunder by  Executive,  then in addition to the
      above,  the  Company  may  also  immediately  cease  making  the  payments
      described  in  Section  2  and  this  Agreement  in  all  other  respects,
      including,  but not limited to the Release provisions set forth in Section
      3, shall remain and full force and effect.

11)   TAX  OBLIGATIONS.  It is  understood  and agreed that  Executive is solely
      liable for all tax  obligations,  if any,  with respect to the  settlement
      payments  provided  for in Section 2, and that such may be withheld by the
      Company prior to any payment thereof.  Failure to withhold any payment due
      from  Executive  shall subject the Executive to payment  thereof when due,
      and/or the Executive shall indemnify the Company for any cost, expense, or
      interest,  that the Company incurs in connection with a demand for payment
      thereof by a regulatory authority.

12)   GOVERNING LAW AND JURISDICTION. This Agreement, in respect of all matters,
      which relate to the  employment by Brainstorm  Cell  Therapeutics  Ltd. or
      Brainstorm Cell  Therapeutics  Inc.,  shall be  interpreted,  enforced and
      governed  in  accordance  with the laws of the  State  of  Israel  without
      reference to conflicts of law  principles and sole  jurisdiction  shall be
      granted to the competent courts in Tel-Aviv.

<PAGE>

13)   SUCCESSORS  AND  ASSIGNS.  Executive  may not  assign any of her rights or
      delegate  any  of  her  duties  under  this  Agreement.   The  rights  and
      obligations  of the Company  shall  inure to the benefit of the  Company's
      successors and assigns.

14)   COSTS.  The  Parties  shall  each  bear  their  own  costs,  expert  fees,
      attorneys' fees and other fees incurred in connection with the Agreement.

15)   CONSULTATION  WITH  COUNSEL.  Executive  acknowledges  that  she has  been
      advised to consult with legal counsel of her choice prior to execution and
      delivery of this Agreement.

16)   INTEGRATION.  This Agreement constitutes an integrated,  written contract,
      expressing the sole and entire agreement  between the Parties with respect
      to the subject matter hereof and  supersedes any and all other  agreements
      or  understandings,  whether  oral or  written,  except the  Undertakings,
      Section  5h of the  Employment  Agreement  and the  Option  Agreement  (as
      applicable),  each of which  shall  remain  in full  force  and  effect in
      accordance  with  their  respective  terms.  In  this  regard,   Executive
      represents  and  warrants  that  she is not  relying  on any  promises  or
      representations,  which do not appear written  herein.  Executive  further
      understands and agrees that this Agreement can be amended or modified only
      by a written agreement,  signed by all of the Parties hereto. In the event
      of any inconsistency  between the terms of this Agreement and the terms of
      any other Company agreement, plan, policy or program,  including,  without
      limitation,  any  Executive  manual or code of conduct,  the terms of this
      Agreement shall prevail.  In the event there is a direct conflict  between
      the  terms  of this  Agreement  and the  Undertakings,  the  terms of this
      Agreement shall prevail.

17)   COMPANY'S  REPRESENTATIONS  AND UNDERTAKINGS.  The Company  represents and
      warrants that this Agreement has been fully and validly  authorized by all
      necessary corporate action. The Company undertakes to continue to abide by
      its undertaking to obtain Directors and Officers' Liability Insurance with
      coverage  that is sufficient  to cover  Executive's  activities as per her
      Employment  Agreement  and  shall  provide  the  Executive  with a written
      undertaking  of the Company to indemnify  and release the Executive to the
      full  extent  possible  in  accordance  with  the  Israeli  Companies  Law
      5759-1999  and the  applicable  Law of the State of  Washington,  USA. The
      Company  undertakes  to maintain the said  insurance  and pay all premiums
      thereof  during  a period  of 5 years  from  the  date  hereof;  provided,
      however, that the Parties expressly acknowledge and agree that the Company
      shall be  entitled  to cancel the said  insurance  prior to the end of the
      aforementioned  period in the event that the Company is declared insolvent
      and/or  bankrupt  and is forced to cease its  operations,  or in the event
      that  that  the   Company  is  unable  to  renew  the  policy  due  to  an
      unavailability  of the said insurance under reasonable  market  conditions
      ("Cancellation  Period").  However, the Parties acknowledge and agree that
      during such Cancellation  Period the Company shall indemnify the Executive
      to the full extent possible in accordance  with the Israeli  Companies Law
      5759-1999 and the applicable law of the State of Washington, USA.

18)   COUNTERPARTS.  This Agreement may be executed in separate counterparts and
      by facsimile,  and each such counterpart  shall be deemed an original with
      the same effect as if all Parties had signed the same document.

19)   HEADINGS.  The headings in each  paragraph  herein are for  convenience of
      reference  only and shall be of no legal effect in the  interpretation  of
      the terms hereof.

<PAGE>

20)   SEVERABILITY  AND WAIVER.  If any  provision  of this  Agreement,  or part
      thereof, is held to be invalid, void, or voidable as against public policy
      or otherwise,  the invalidity shall not affect other provisions,  or parts
      thereof,  which may be given effect without the invalid provision or part.
      Any waiver of any  provision  of this  Agreement  shall not  constitute  a
      waiver  of any other  provision  of this  Agreement  unless  expressly  so
      indicated otherwise.  The language of all parts of this Agreement shall in
      all cases be construed  according to its fair meaning and not strictly for
      or against either of the Parties.

21)   VOLUNTARY  AGREEMENT.  EXECUTIVE  UNDERSTANDS  AND AGREES  THAT SHE MAY BE
      WAIVING SIGNIFICANT LEGAL RIGHTS BY SIGNING THIS AGREEMENT, AND REPRESENTS
      THAT SHE HAS  ENTERED  INTO  THIS  AGREEMENT  KNOWINGLY  AND  VOLUNTARILY,
      WITHOUT ANY DURESS OR UNDUE  INFLUENCE  WITH THE FULL INTENT OR  RELEASING
      ALL CLAIMS  AGAINST  THE FULL  COMPLIANCE  OF THE  COMPANY'S  UNDERTAKINGS
      HEREUNDER.  EXECUTIVE  ACKNOWLEDGES THAT SHE HAS READ THIS AGREEMENT,  SHE
      HAS BEEN REPRESENTED IN THE NEGOTIATION,  AND EXECUTION OF THIS RELEASE BY
      LEGAL COUNSEL OF HER OWN CHOICE,  AND SHE  UNDERSTANDS  THE PROVISIONS AND
      LEGAL  CONSEQUENCES OF THIS  AGREEMENT.SHE  FURTHER  ACKNOWLEDGES THAT SHE
      DOES NOT RELY ON ANY  REPRESENTATION,  PROMISE OR  INDUCEMENT  MADE BY THE
      COMPANY OR ITS  REPRESENTATIVES  WITH THE  EXCEPTION OF THE  CONSIDERATION
      DESCRIBED IN THIS AGREEMENT.

      IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
dates provided below.

                                    BRAINSTORM CELL THERAPEUTICS INC.

                                    BRAINSTORM CELL THERAPEUTICS LTD.

                                    By: /s/ Yoram Drucker
                                        ----------------------------------------
                                    Its: PRINCIPAL EXECUTIVE OFFICER

                                    DR. YAFFA BECK

                                    /s/ Yaffa Beck
                                    --------------------------------------------

<PAGE>
Appendix A

As agreed,  the total amount  Executive  will receive is $74,000 minus  employer
cost since November 10

Yaffa Beck-Employer cost November 10, 2005 - January 31, 2006

Exch. Rate                 USD          NIS             NIS            Month
-------------------      -------      -------      -----------      ------------
              4.633        6,640       30,961           46,442           11.2005
-------------------      -------      -------      -----------      ------------
              4.603       10,089       46,441                            12.2005
-------------------      -------      -------      -----------      ------------
              4.69         9,916       46,508                             1.2006
-------------------      -------      -------      -----------      ------------
                          26,645      123,910
                         =======      =======

                                                              $
         Amount executive should get                      74,000

           Deduction: Employer cost                      -26,645

         Total Payment                                    47,355

<PAGE>

                                   Appendix C

                            Executive's Undertakings

7.    Competitive Activity

      During the term of this  Agreement  and for a period of twelve (12) months
from the Termination Date of this Agreement,  the Executive will not directly or
indirectly:

      (i)   Carry on or hold an  interest  in any  company,  venture,  entity or
            other business (other than a minority  interest in a publicly traded
            company) which directly competes with the Technology;

      (ii)  Act as a consultant  or  executive  or officer or in any  managerial
            capacity in a business directly competing with the Technology;

      (iii) Solicit,  canvass or approach  or  endeavor  to solicit,  canvass or
            approach  any  person  who,  to her  knowledge,  was  provided  with
            services by the Company or its  subsidiaries  at any time during the
            twelve (12) months  immediately  prior to the Termination  Date, for
            the  purpose of  offering  restricted  services  or  products  which
            directly compete with the Technology; or

      (iv)  Employ, solicit or entice away or endeavor to solicit or entice away
            from the Company or its subsidiaries any time during the twelve (12)
            months  immediately  prior to the  Termination  Date  with a view to
            inducing that person to leave such employment and to act for another
            employer in the same or a similar capacity.

8.    Ownership  and  Protection  of  Intellectual   Property  and  Confidential
      Information

      (a)   All information,  ideas, concepts,  improvements,  discoveries,  and
            inventions,  whether  patentable or not, which are conceived,  made,
            developed or acquired by Executive,  individually  or in conjunction
            with  others,  during  Executive's   employment  by  Company,  which
            directly relate to the Company's business,  Technology,  products or
            services and all writings or materials of any type  embodying any of
            such items, shall be the sole and exclusive property of the Company.

      (b)   Executive  acknowledges  that the  business  of the  Company and its
            affiliates  are  highly   competitive  and  that  their  strategies,
            methods, books, records, and documents,  their technical information
            concerning their  Technology,  products,  equipment,  services,  and
            processes,  procurement procedures and pricing techniques, the names
            of and  other  information  (such  as  credit  and  financial  data)
            concerning  their  customers and business  affiliates,  all comprise
            confidential  business  information  and  trade  secrets  which  are
            valuable,  special,  and unique  assets  which  Company  uses in its
            business to obtain a competitive advantage over its competitors (the
            "Confidential  Information").  Executive  further  acknowledges that
            protection of such  Confidential  Information  against  unauthorized

<PAGE>

            disclosure  and  use  is  of  critical   importance  to  Company  in
            maintaining its competitive  position.  Executive hereby agrees that
            Executive  will not, at any time during or after her  employment  by
            Company,  make  any  unauthorized  disclosure  of  any  Confidential
            Information  fo  Company,  or make any use  thereof,  except  in the
            carrying   out  of  her   employment   responsibilities   hereunder.
            Confidential  Information  shall not include (i)  information in the
            public  domain  (but  only if the same  becomes  part of the  public
            domain through a means other than a disclosure prohibited hereunder)
            or (ii)  information  which was  lawfully in the  possession  of the
            Executive prior to the Executive's  employment by Company. The above
            not  withstanding,  a disclosure shall not be unauthorized if (i) it
            is required by law or by a court of competent  jurisdiction  or (ii)
            it is in connection  with any judicial or other legal  proceeding in
            which Executive's legal rights and obligations as an Executive under
            this  Agreement  are at issue;  provided,  however,  that  Executive
            shall, to the extent practicable and lawful in any such events, give
            prior  notice  to  Company  of  her  intent  to  disclose  any  such
            confidential  business  information  in such  context so as to allow
            Company an opportunity  (which  Executive will not oppose) to obtain
            such protective  orders or similar relief with respect thereto as it
            may deem appropriate.

      (c)   All written  materials,  records,  and other  documents  made by, or
            coming  into the  possession  of,  Executive  during  the  period of
            Executive's   employment   by  Company  which  contain  or  disclose
            Confidential  Information of Company or its affiliates  shall be and
            remain  property of Company or its  affiliates,  as the case may be.
            Upon  termination  of  Executive's  employment  by Company,  for any
            reason,  Executive  promptly  shall deliver the same, and all copies
            thereof, to Company.AMENDED
      AND RESTATED CREDIT AGREEMENT

     

    This
      Amended and Restated Credit Agreement (the “Agreement”)
      is
      entered into as of January 23, 2006, by and among ADAMS
      GOLF, INC.,
      a
      Delaware corporation; ADAMS
      GOLF HOLDING CORP,
      a
      Delaware corporation; ADAMS
      GOLF GP CORP,
      a
      Delaware corporation; ADAMS
      GOLF, LTD.,
      a Texas
      limited partnership; ADAMS
      GOLF IP, LP,
      a
      Delaware limited partnership; and ADAMS
      GOLF MANAGEMENT CORP,
      a
      Delaware corporation (the “Borrowers”),
      whose
      address is 2801 E. Plano Parkway, Plano, Texas, 75074 and BANK
      OF TEXAS, N.A.
      (“Lender”)
      whose
      address is 5956 Sherry Lane, Suite 1100, Dallas, Texas 75225. 

     

    RECITALS:

     

    WHEREAS,
      heretofore on February 13, 2004, Borrowers and Lender entered into that certain
      Credit Agreement, as amended by (a) First Amendment to Credit Agreement and
      Promissory Note dated as of February 10, 2005, among the Borrowers and
      Lender and (b) Second Amendment to Credit Agreement dated as of April 13, 2005,
      among Borrowers and Lender (said credit agreement as so amended is herein called
      the “Existing
      Credit Agreement”);
      and

     

    WHEREAS,
      Borrower has requested additional extensions of credit and certain amendments
      to
      the Existing Credit Agreement, and Lender, subject to the terms hereof, has
      agreed to the same;

     

    NOW,
      THEREFORE, in consideration to the mutual covenants contained in this Agreement
      and other good and valuable consideration, the receipt and sufficiency of which
      are acknowledged by each of the parties to this Agreement, the Borrowers and
      the
      Lender hereby agree that the Existing Credit Agreement is hereby amended and
      restated in its entirety to hereafter read as follows:

     

    ARTICLE
      1. DEFINED
      TERMS.

     

    “Affiliate”
means,
      as to any Person, any other Person (a) that directly or indirectly, through
      one
      or more intermediaries, controls or is controlled by, or is under common control
      with, such Person; (b) that directly or indirectly beneficially owns or holds
      five percent (5%) or more of any class of voting stock of such Person; or (c)
      five percent (5%) or more of the voting stock of which is directly or indirectly
      beneficially owned or held by the Person in question. The term “control” means
      the possession, directly or indirectly, of the power to direct or cause
      direction of the management and policies of a Person, whether through the
      ownership of voting securities, by contract, or otherwise; provided, however,
      in
      no event shall the Lender be deemed an Affiliate of the Borrowers or any of
      its
      Subsidiaries or Affiliates.

     

    “Authorization
      Documents”
means,
      as to any Person which is not an individual, all appropriate evidences of the
      authority of such Person to execute, deliver and perform the Loan Documents
      to
      which it is a party, including, without limitation, as to any such Person which
      is a corporation, resolutions of its Board of Directors certified by its
      secretary or an assistant secretary, and a Certificate of Incumbency certified
      by its secretary or an assistant secretary certifying the names of the officers
      of such Person authorized to sign the Loan Documents to which it is a
      party.

     

    “Authorized
      Officer”
means,
      (a) with respect to the Corporate Borrowers, the President, Vice President,
      or
      Chief Financial Officer of each such respective Corporate Borrower and (b)
      with
      respect to the Partnership Borrowers, the President, Vice President, or Chief
      Financial Officer of the general partner of the Partnership Borrowers, in each
      case as designated in writing to Lender.

     

    “Business
      Day”
means
      a
      day (other than Saturday, Sunday or a legal holiday) on which commercial banks
      are open for business in Dallas, Texas.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Capital
      Lease Obligation”
means
      the amount of Debt under a lease of Property by a Person that would be shown
      as
      a liability on a balance sheet of such Person prepared for financial reporting
      purposes in accordance with GAAP.

     

    “Capital
      Expenditure”
means
      any expenditure by a Person for (a) an asset which will be used in a year
      or years subsequent to the year in which the expenditure is made and which
      asset
      is properly classified in relevant financial statements of such Person as
      equipment, real property, a fixed asset or a similar type of capitalized asset
      in accordance with GAAP or (b) an asset relating to or acquired in
      connection with an acquired business, and any and all acquisition costs related
      to (a) or (b) above.

     

    “Cash
      Flow Leverage Ratio”
means,
      in respect of a Person and for any period of determination, the ratio of (a)
      Funded Debt as of the period of determination to (b) EBITDA minus the sum of
      (i)
      cash taxes and (ii) distributions on a trailing twelve (12) month period from
      the period of determination.

     

    “Charter
      Documents”
means,
      as to any Person which is not an individual, as applicable, its
      articles/certificate of incorporation, bylaws, certificate of partnership,
      partnership agreement, certificate of formation, limited liability agreement,
      operating agreement and all shareholder agreements, voting trusts and similar
      arrangements evidencing the existence, good standing, governance and authority
      of such Person together with appropriate certificates of the appropriate
      governmental officials of the state of incorporation or formation of such Person
      as to the existence and good standing of such Person.

     

    “Closing
      Date”
means,
      the date upon which all of the conditions precedent set forth in Article 7
      hereof have been performed by Borrowers to Lender’s satisfaction.

     

    “Closing
      Documents”
means
      a
      collective reference to (i) the Charter Documents and Authorization Documents
      of
      Borrowers, certified as of a Current Date; (ii) the Loan Documents, dated as
      of
      the Closing Date and executed and delivered by the appropriate Person; (iii)
      the
      Initial Borrowing Base Report certified by the Borrowers, as of a Current Date,
      and (iv) the Request for Loan executed by Borrowers.

     

    “Code”
means
      the Internal Revenue Code of 1986, as amended, and the regulations promulgated
      and rulings issued thereunder.

     

    “Collateral”
means
      all property of any kind which is subject to a Lien in favor of Lender or which,
      under the terms of any Loan Documents, is or is purported to be encumbered
      by
      any Lien in favor of Lender or subject to any Lien in favor of
      Lender.

     

    “Commitment”
means
      the obligation of Lender to make the Loans to Borrowers pursuant to Section
      2.1
      up to an
      aggregate principal amount at any time outstanding of
      $10,000,000.00.

     

    “Corporate
      Borrowers”
means
      Adams Golf, Inc., Adams Golf Holding Corp, Adams Golf GP Corp, and Adams Golf
      Management Corp.

     

    “Current
      Date”
means
      a
      date which is within five (5) calendar days prior to the Closing
      Date.

     

    “Current
      Maturities of Long-Term Indebtedness”
means,
      in respect of a Person and as of any applicable date of determination thereof,
      that portion of Long-Term Indebtedness that should be classified as current
      in
      accordance with GAAP.

     

    “Debt”
means
      as to any Person at any time (without duplication): (a) all obligations of
      such Person for borrowed money, (b) all obligations of such Person
      evidenced by bonds, notes, debentures, or other similar instruments,
      (c) all obligations of such Person to pay the deferred purchase price of
      property or services, except trade accounts payable of such Person arising
      in
      the ordinary course of business that are not past due by more than ninety (90)
      days, (d) all Capital Lease Obligations of such Person, (e) all Debt
      or other obligations of others guaranteed by such Person, (f) all
      obligations secured by a Lien existing on property owned by such Person, whether
      or not the obligations secured thereby have been assumed by such Person or
      are
      non-recourse to the credit of such Person, (g) any other obligation for
      borrowed money or other financial accommodations which in accordance with GAAP
      would be shown as a liability on the balance sheet of such Person, (h) any
      repurchase obligation or liability of a Person with respect to accounts, chattel
      paper or notes receivable sold by such Person, (i) any liability under a
      sale and leaseback transaction that is not a Capital Lease Obligation,
      (j) any obligation under any so-called “synthetic leases”, (k) all
      reimbursement obligations of such Person (whether contingent or otherwise)
      in
      respect of letters of credit, bankers’ acceptances, surety or other bonds and
      similar instruments, and (m) all liabilities of such Person in respect of
      unfunded vested benefits under any Plan.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Default”
means
      any of the events or conditions specified in Section
      6.1,
      whether
      or not any requirement for notice or lapse of time or any other condition has
      been satisfied.

     

    “Default
      Interest Rate”
has
      the
      meaning assigned to it in the Note.

     

    “EBITDA”
means
      an amount equal to Net Income plus
      the sum
      of taxes, Interest Expense, depreciation and amortization.

     

    “ERISA”
means
      the Employee Retirement Income Security Act of 1974, as amended from time to
      time, together with all rules and regulations promulgated with respect
      thereto.

     

    “Event
      of Default”
means
      any of the events or conditions specified in Section
      6.1
      provided
      that any requirement for notice or lapse of time or any other condition has
      been
      satisfied.

     

    “Fixed
      Charge Coverage Ratio”
means,
      in respect of a Person and for any period of determination, the ratio, computed
      on a trailing twelve (12) month period, of (a) EBITDA less the sum of (i) all
      unfinanced Capital Expenditures (ii) dividends and distributions paid and (iii)
      cash taxes paid (without benefit of any refunds), divided by (b) the sum of
      (i)
      Current Maturities of Long-Term Indebtedness (ii) Capital Lease Obligations,
      and
      (iii) Interest Expense (excluding capitalized interest).

     

    “Funded
      Debt”
means
      Debt described in clauses (a), (b), (d), (g), (i), and (j) of the definition
      of
“Debt”.

     

    “GAAP”
means
      generally accepted accounting principles, applied on a consistent basis, as
      set
      forth in the opinions and pronouncements of the Accounting Principles Board
      of
      the American Institute of Certified Public Accountants and/or in statements
      and
      pronouncements of the Financial Accounting Standards Board and/or their
      successors which are applicable in the circumstances as of the date in question;
      provided, however, for purposes of determining compliance with any covenant
      set
      forth in Article
      4
      of this
      Agreement, such terms shall be construed in accordance with GAAP as in effect
      on
      the date of this Agreement applied on a basis consistent with the application
      used in the Initial Financial Statements. Accounting principles are applied
      on a
“consistent basis” when the accounting principles applied in a current period
      are comparable in all material respects to those accounting principles applied
      in a preceding period.

     

    “Governmental
      Authority”
means
      any nation or government, any state or political subdivision thereof and any
      entity exercising executive, legislative, judicial, regulatory, or
      administrative functions of or pertaining to government.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Inactive
      Subsidiaries”
has
      the
      meaning assigned that term in Section
      3.22
      hereof.

     

    “Indebtedness”
means
      the unpaid principal of and interest on (including, without limitation, interest
      accruing after the maturity of the Loans and interest accruing after the filing
      of any petition in bankruptcy, or the commencement of any insolvency,
      reorganization or like proceeding, relating to Borrowers, whether or not a
      claim
      for post-filing or post-petition interest is allowed in such proceeding) the
      Loans and all other obligations and liabilities of Borrowers to Lender, whether
      direct or indirect, absolute or contingent, due or to because due, or now
      existing or hereafter incurred, which may arise under, out of, or in connection
      with, this Agreement, any other Loan Document or any other document made,
      delivered or given in connection herewith or therewith, whether on account
      of
      principal, interest, reimbursement obligations, fees, indemnities, costs,
      expenses (including, without limitation, all fees, charges and disbursements
      of
      counsel to Lender that are required to be paid by Borrowers pursuant hereto)
      or
      otherwise.

     

    “Interest
      Expense”
means,
      in respect of a Person and for any period, the interest expense of such Person
      for such period determined in accordance with GAAP.

     

    “Law”
means
      any law, regulation, rule, order, decree, license or permit, domestic or
      foreign.

     

    “Lien”
means
      any lien, mortgage, security interest, pledge, deposit, rights of vendor under
      any title retention or conditional sale agreement or lease substantially
      equivalent thereto, or any charge or encumbrance for security purposes, whether
      arising by Law or agreement or otherwise.

     

    “Loan
      Documents”
means
      this Agreement, the Note, the Security Instruments, and all other certificates,
      documents and agreements executed in connection with this
      Agreement.

     

    “Loans”
means
      the loans made by Lender to Borrowers pursuant to Section
      2.1.

     

    “Long-Term
      Indebtedness”
means,
      in respect of a Person and as of any applicable date of determination thereof,
      all Debt which should be classified as “funded indebtedness” or “long-term
      indebtedness” on a balance sheet of such Person as of such date in accordance
      with GAAP and Long-Term Indebtedness includes Capital Lease
      Obligations.

     

    “Material
      Adverse Effect”
means
      any set of circumstances or events which (a) is or could reasonably be expected
      to be material and adverse to the business, condition (financial or otherwise),
      operations, Property, assets, operations, prospects or profits of Borrowers,
      (b)
      has or could reasonably be expected to have any material adverse effect
      whatsoever upon the validity or enforceability of any of the Loan Documents
      or
      any of the transactions contemplated by the Loan Documents, (c) materially
      impairs or could reasonably be expected to materially impair the ability of
      Borrowers to pay the Indebtedness or to perform their respective obligations
      under any of the Loan Documents, (d) impairs or could reasonably be expected
      to
      impair the ability of Lender to enforce its legal rights and remedies under
      any
      of the Loan Documents, or (e) impairs or could reasonably be expected to impair
      the priority of the Liens under any Loan Document or the value of the
      Collateral.

     

    “Maximum
      Rate”
means
      the maximum lawful rate of interest permitted by applicable usury laws now
      or
      hereafter enacted which interest rate shall change when and as said laws change,
      to the extent permitted by said laws, effective on the day such change in said
      laws becomes effective, provided, however, that the term “Maximum Rate” means a
      rate equal to three (3) percentage points above the Prime Rate as it varies
      if
      there is no Maximum Rate.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Net
      Income”
means,
      for any period, the net income or net loss for such period of any Person,
      determined in accordance with GAAP; provided,
      however,
      there
      shall be excluded (a) any write-up of the value of any asset and (b) any
      non-cash items.

     

    “Note”
has
      the
      meaning assigned that term in Section
      2.1.

     

    “Partnership
      Borrowers”
means
      Adams Golf, Ltd. and Adams Golf IP, LP.

     

    “Permitted
      Liens”
means
      (a) Liens in favor of Lender, (b) Liens for taxes, assessments and other
      governmental charges arising by law in the ordinary course of business for
      sums
      which are not yet due and payable, (c) Liens of mechanics, materialmen,
      warehousemen and other like Persons arising by law in the ordinary course of
      business for sums which are not yet due and payable, (d) Liens, not delinquent,
      created by statute in connection with worker’s compensation, unemployment
      insurance and social security obligations, (e) encumbrances consisting of minor
      easements, zoning restrictions or other restrictions on the use of real property
      that do not (individually or in the aggregate) materially affect the value
      of
      the assets encumbered or materially impair the ability of any Borrower to use
      the assets in its business, and (f) liens held by Tom Watson on the liquidated
      net assets including the inventory, accounts and account receivables of Adams
      Golf, Inc., and Adams Golf, Ltd., to the extent such liens have been
      subordinated to the liens held by Lender.

     

    “PBGC”
means
      the Pension Benefit Guaranty Corporation or any entity succeeding to all or
      any
      of its functions under ERISA.

     

    “Person”
means
      an individual, corporation, partnership, association, joint stock company,
      trust, estate, unincorporated organization or joint venture, or a court or
      governmental unit or any agency or subdivision thereof, or any other legally
      recognizable entity.

     

    “Plan”
means
      any employee benefit or other plan established or maintained by Borrowers and
      which is covered by Title IV of ERISA.

     

    “Prime
      Rate”
has
      the
      meaning set forth in the Note.

     

    “Prohibited
      Transaction”
means
      any transaction set forth in Section 406 of ERISA or Section 4975 of the
      Code.

     

    “Property”
means
      any interest in any kind of property or assets, whether real, personal or mixed,
      or tangible or intangible.

     

    “Reportable
      Event”
means
      any of the events set forth in Section 4043 of ERISA.

     

    “Security
      Instruments”
has
      the
      meaning assigned to that term in Section
      7.1.

     

    “Stock”
means
      all shares, options, interests, participations or other equivalents (howsoever
      designated) of or in a corporation, whether voting or non-voting, including,
      without limitation, common stock, warrants, preferred stock, convertible
      debentures, and all agreements, instruments, and documents convertible, in
      whole
      or in part, into any one or more of all of the foregoing.

     

    “Subsidiary”
means
      any corporation of which more than fifty percent (50%) of the issued and
      outstanding securities having ordinary voting power for the election of
      directors is owned or controlled, directly or indirectly, by a Borrower and/or
      one or more of its Subsidiaries.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Termination
      Date” means January 23, 2009, unless sooner terminated pursuant to Section
      6.2.

     

    “UCC”
means
      the Uniform Commercial Code, as enacted and in effect in the State of
      Texas.

     

    ARTICLE
      2. AMOUNT
      AND TERMS OF CREDIT.

     

    2.1 The
      Commitment.
      Subject
      to, and upon the terms, conditions, covenants and agreements contained in this
      Agreement, Lender agrees to make Loans to Borrowers from time to time for a
      period from and after the date of this Agreement up to but not including the
      Termination Date in such amounts as Borrowers may request up to but not
      exceeding an aggregate principal sum at any time outstanding equal to the
      Commitment. Within such limits and during such period, Borrowers may borrow,
      repay, and re-borrow under this Agreement. To evidence the Loans, Borrowers
      will
      issue, execute and deliver an amended and restated promissory note (such note
      together with any and all renewals, extensions and/or rearrangements thereof
      is
      called the “Note”)
      dated
      as of the date of this Agreement in the principal amount of the Commitment
      and
      payable to the order of Lender on the Termination Date, and otherwise being
      in
      form and substance satisfactory to Lender. Unpaid principal of, and accrued
      interest on, the Loans shall be paid in accordance with the terms of the Note.
      Interest on the Loans shall accrue at the rates provided in Section
      2.2.

     

    2.2 Interest
      Rate.
      The
      unpaid principal amount of the Note shall, subject to the following sentence,
      bear interest as provided in the Note. If at any time the rate of interest
      specified in the Note would exceed the Maximum Rate but for the provisions
      thereof limiting interest to the Maximum Rate, then any subsequent reduction
      shall not reduce the rate of interest on the Loans below the Maximum Rate until
      the aggregate amount of interest accrued on the Loans equals the aggregate
      amount of interest which would have accrued on the Loans if the interest rate
      had not been limited by the Maximum Rate. 

     

    2.3 Request
      for Loans.
      Each
      Loan shall be made on the same Business Day as written notice in the form of
      the
“Request for Loan” attached to this Agreement as Exhibit
      “A”
      duly
      completed and executed by an Authorized Officer of each Borrower is received
      by
      Lender if received by 12:00 p.m. (Dallas, Texas time) and on the next Business
      Day if received by Lender after 12:00 p.m. (Dallas, Texas time). If all
      conditions precedent to the Loan have been met, Lender will, on the date
      requested, make the Loan available to Borrowers by depositing the proceeds
      thereof into an account maintained at Lender as directed by
      Borrowers.

     

    2.4 Mandatory
      Prepayments.
      If the
      unpaid principal balance of the Loans exceeds the Commitment, Borrowers shall
      immediately prepay the principal of the Loans in an amount at least equal to
      the
      excess. Each prepayment of principal under this Section shall be accompanied
      by
      all interest then accrued and unpaid on the principal so prepaid. Any principal
      or interest prepaid under this Section shall be in addition to, and not in
      lieu
      of, all payments otherwise required to be paid under the Loan Documents at
      the
      time of the payment.

     

    2.5 Computation
      of Interest.
      All
      payments of interest shall be computed on the per annum basis of a year of
      360
      days, but to the extent such computations of interest might cause the rate
      of
      interest to exceed the Maximum Rate, the interest shall be computed on the
      basis
      of a year of 365 or 366 days, as applicable.

     

    2.6 Voluntary
      Prepayments.
      Borrowers may prepay the unpaid principal of the Note at any time in whole
      or
      from time to time in part, without premium or penalty, but with accrued interest
      to the date of prepayment on the amount so prepaid. Each prepayment of principal
      of the Note shall be applied to reduce the outstanding principal balance of
      the
      Note. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2.7 Joint
      and Several Liability of Borrowers.
      

     

    (a) Each
      of
      the Borrowers are accepting joint and several liability under this Agreement,
      the Note, and the other Loan Documents in consideration of the financial
      accommodations to be provided by the Lender under this Agreement, for the mutual
      benefit, directly and indirectly, of each of the Borrowers and in consideration
      of the undertakings of the other Borrowers to accept joint and several liability
      for the Indebtedness.

     

    (b) Each
      of
      the Borrowers, jointly and severally, hereby irrevocably and unconditionally
      accepts, not merely as a surety but also as a co-debtor, joint and several
      liability with the other Borrowers, with respect to the payment and performance
      of all of the Indebtedness (including, without limitation, any Indebtedness
      arising under this Section 2.7), it being the intention of the parties hereto
      that all the Indebtedness shall be the joint and several Indebtedness of each
      of
      the Borrowers without preferences or distinction among them.

     

    (c) If
      and to
      the extent that any of the Borrowers shall fail to make any payment with respect
      to any of the Indebtedness as and when due in accordance with the terms thereof,
      then in each such event the other Borrowers will make such payment with respect
      to, such Indebtedness.

     

    (d) The
      Indebtedness of each Borrower constitutes the absolute and unconditional, full
      recourse Indebtedness of such Borrower enforceable against each such Borrower
      to
      the full extent of its properties and assets, irrespective of the validity,
      regularity or enforceability of this Agreement or any other circumstances
      whatsoever.

     

    (e) Each
      Borrower hereby waives notice of acceptance of its joint and several liability,
      notice of any Loans issued under or pursuant to this Agreement, notice of the
      occurrence of any Default, Event of Default, or of any demand for any payment
      under this Agreement, the Note, or any of the other Loan Documents (except
      for
      notices required under this Agreement and the other Loan Documents), notice
      of
      any action at any time taken or omitted by Lender under or in respect of any
      of
      the Indebtedness, any requirement of diligence or to mitigate damages and,
      generally, to the extent permitted by applicable law, all demands, notices
      and
      other formalities of every kind in connection with this Agreement, the Note,
      and
      the other Loan Documents (except as otherwise provided in this Agreement).
      Each
      Borrower hereby assents to, and waives notice of, any extension or postponement
      of the time for the payment of any of the Indebtedness, the acceptance of any
      payment of any of the Indebtedness, the acceptance of any partial payment
      thereon, any waiver, consent or other action or acquiescence by Lender at any
      time or times in respect of any default by any Borrower in the performance
      or
      satisfaction of any term, covenant, condition or provision of this Agreement
      or
      any of the other Loan Documents, any and all other indulgences whatsoever by
      Lender in respect of any of the Indebtedness, and the taking, addition,
      substitution or release, in whole or in part, at any time or times, of any
      security for any of the Indebtedness or the addition, substitution or release,
      in whole or in part, of any Borrower. The Indebtedness of each Borrower shall
      not be diminished or rendered unenforceable by any winding up, reorganization,
      arrangement, liquidation, reconstruction or similar proceeding with respect
      to
      any Borrower or Lender. The joint and several liability of the Borrower
      hereunder shall continue in full force and effect notwithstanding any
      absorption, merger, or any other change whatsoever in the name, constitution
      or
      place of formation of any of the Borrower or Lender.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (f) Each
      Borrower hereby agrees that it will not enforce any of its rights of
      contribution or subrogation against the other Borrowers with respect to any
      liability incurred by it under this Agreement, the Note or any of the other
      Loan
      Documents, any payments made by it to the Lender with respect to any of the
      Indebtedness or any collateral security therefor until such time as all of
      the
      Indebtedness has been paid in full in cash. Any claim which any Borrower may
      have against any other Borrower with respect to any payments to Lender under
      this Agreement, the Note or any other Loan Documents are hereby expressly made
      subordinate and junior in right of payment, without limitation as to any
      increases in the Indebtedness arising hereunder or thereunder, to the prior
      payment in full in cash of the Indebtedness and, in the event of any insolvency,
      bankruptcy, receivership, liquidation, reorganization or other similar
      proceeding under the laws of any jurisdiction relating to any Borrower, its
      debts or its assets, whether voluntary or involuntary, all Indebtedness shall
      be
      paid in full in cash before any payment or distribution of any character,
      whether in cash, securities or other property, shall be made to any other
      Borrower therefor.

     

    (g) Each
      Borrower hereby agrees that, after the occurrence and during the continuance
      of
      any Default or Event of Default, the payment of any amounts due with respect
      to
      the indebtedness owing by any Borrower to any other Borrower is hereby
      subordinated to the prior payment in full in cash of the Indebtedness. Each
      Borrower hereby agrees that after the occurrence and during the continuance
      of
      any Default or Event of Default, such Borrower will not demand, sue for or
      otherwise attempt to collect any indebtedness of any other Borrower owing to
      such Borrower until the Indebtedness shall have been paid in full in cash.
      If,
      notwithstanding the foregoing sentence, such Borrower shall collect, enforce
      or
      receive any amounts in respect of such indebtedness, such amounts shall be
      collected, enforced and received by such Borrower as trustee for the Lender
      for
      application to the Indebtedness.

     

    (h) In
      addition to all such rights of indemnity and subrogation as the Borrowers may
      have under applicable law (but subject to Section 2.7(f)), the Borrowers agree
      that (i) in the event a payment shall be made by any Borrower under this
      Agreement, the Note or any of the other Loan Documents, the remaining Borrowers
      shall indemnify such Borrower for the full amount of such payment and such
      Borrower shall be subrogated to the rights of the person to whom such payment
      shall have been made to the extent of such payment and (b) in the event any
      assets of any Borrower shall be sold pursuant to any Loan Document to satisfy
      in
      whole or in part a claim of Lender, the remaining Borrowers shall indemnify
      such
      Borrower in an amount equal to the greater of the book value or the fair market
      value of the assets so sold.

     

    (i) Each
      Borrower (a “Contributing Borrower”) agrees (subject to Section 2.7(f)) that, in
      the event a payment shall be made by any other Borrower under this Agreement,
      the Note or any other of the other Loan Documents or assets of any other
      Borrower shall be sold pursuant to any Loan Document to satisfy a claim, in
      whole or in part, of Lender and such other Borrower (the “Claiming Borrower”)
      shall have not been fully indemnified by the other Borrowers as provided in
      Section 2.7(h), the Contributing Borrowers shall indemnify the Claiming Borrower
      in an amount equal to the amount of such payment or the greater of the book
      value or the fair market value of such assets, as the case may be, in each
      case
      multiplied by a fraction of which the numerator shall be the net worth of the
      Contributing Borrower on the date hereof and the denominator shall be the
      aggregate net worth of all the Borrowers on the date hereof. Any Contributing
      Borrower making any payment to a Claiming Borrower pursuant to this Section
      2.7(i) shall be subrogated to the rights of such Claiming Borrower under Section
      2.7(h) to the extent of such payment.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (j) No
      failure on the part of a Borrower to make the payments required by Section
      2.7(h) or 2.7(i) (or any other payments required under applicable law or
      otherwise) shall in any respect limit the Indebtedness and liabilities of any
      Borrower with respect to its Indebtedness under this Agreement, the Note and
      the
      other Loan Documents, and each Borrower shall remain liable for the full amount
      of the Indebtedness.

     

    2.8 Clean-Up
      Period.
      Borrower will cause the unpaid principal balance of the Note to be reduced
      to
      zero for at least a thirty (30) consecutive day period in each calendar year
      during the term of this Agreement.

     

    ARTICLE
      3. REPRESENTATIONS
      AND WARRANTIES.
      In
      addition to any other representations or warranties made by Borrowers in any
      of
      the other Loan Documents, in order to induce Lender to enter into this Agreement
      and to make the Loans, Borrowers represent and warrant to Lender (which
      representations and warranties will survive the delivery of the Note and the
      making of the Loans) that:

     

    3.1 Organization.
      

     

    (a) Each
      Corporate Borrower is a corporation duly organized, validly existing and in
      good
      standing under the laws of the jurisdiction of its incorporation and is duly
      qualified to transact business in the State of Texas and in each other
      jurisdiction wherein the Property owned or the business transacted by it makes
      such qualification necessary.

     

    (b) Each
      Partnership Borrower is a limited partnership duly formed and validly existing
      under the laws of the jurisdiction of its formation and is duly qualified to
      transact business in the State of Texas and in each other jurisdiction wherein
      the Property owned or the business transacted by it makes such qualification
      necessary.

     

    3.2 Power
      and Authority.
      Each
      Borrower has full power and authority to enter into, execute and deliver the
      Loan Documents to which it is a party, to consummate the transactions
      contemplated in the Loan Documents to which it is a party, and to incur the
      obligations provided for in the Loan Documents, all of which have been duly
      authorized by all necessary and proper action.

     

    3.3 Consents.
      No
      consent or approval of any public authority or third party, or of any
      stockholders or partners of Borrowers, as applicable, is required as a condition
      to the validity of any of the Loan Documents which has not been
      obtained.

     

    3.4 Binding
      Obligations.
      The
      Loan Documents constitute legal, valid and binding obligations of each Borrower
      to the extent it is a party thereto, enforceable in accordance with their
      respective terms, except as enforcement may be limited by bankruptcy, insolvency
      or other laws of general application relating to the enforcement of creditors’
rights.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.5 No
      Legal Bar, Etc.
      The
      execution and delivery of the Loan Documents, the performance by each Borrower
      of its obligations under the Loan Documents to which it is a party, and the
      consummation of the transactions contemplated by the Loan Documents, do not
      and
      will not (a) conflict with any provision of any Law, any Borrower’s Charter
      Documents, any agreement, judgment, license, order or permit applicable to
      or
      binding upon any Borrower or any of its Property, (b) result in the acceleration
      of any Debt owed by any Borrower, or (c) result in or require the creation
      of
      any Lien upon any Property of Borrower. No consent, approval, authorization,
      or
      order of, and no notice to or filing with, any court or governmental authority
      or third party is required in connection with the execution, delivery or
      performance of any of the Loan Documents or to consummate any transaction
      contemplated by the Loan Documents.

     

    3.6 Trade
      Names, Place of Business.
      No
      Borrower has, during the preceding five (5) years, been known by or used any
      other name. The chief executive office and principal place of business of
      Borrowers are located at the address of Borrowers set forth above.

     

    3.7 Proceedings.
      Except
      as disclosed in public filings by Adams Golf, Inc., there are no actions, suits
      or proceedings pending or, to the knowledge of Borrowers, threatened against
      or
      affecting any Borrower before any court or administrative agency which on the
      date of this Agreement has, or which if adversely determined against such
      Borrower could reasonably be expected to have, a Material Adverse Effect on
      the
      Borrowers taken as a whole.

     

    3.8 Financial
      Statements.
      The
      financial statements of Borrowers which have been delivered to Lender prior
      to
      the date of this Agreement (the “Initial Financial Statements”) have been
      prepared in accordance with GAAP and present fairly the financial condition
      and
      results of the operation of Borrowers as at the dates and for the periods
      covered. Since [September
      30, 2005],
      no
      adverse change has occurred in the condition, financial or otherwise, of
      Borrowers.

     

    3.9 Investments
      and Guaranties.
      No
      Borrower has made investments in, advances to, or guaranties of the Debt of,
      any
      Person, except as disclosed in the Initial Financial Statements.

     

    3.10 Debt.
      No
      Borrower has any Debt, except as disclosed in the Initial Financial
      Statements.

     

    3.11 Taxes.
      All
      income taxes and other taxes due and payable by each Borrower through the date
      of this Agreement have been paid prior to becoming delinquent.

     

    3.12 Title.
      Each
      Borrower has good and indefeasible title to all its Property, free and clear
      of
      any Liens and security interests, except for Permitted Liens.

     

    3.13 No
      Defaults.
      No
      event or condition has occurred and is continuing which constitutes, or with
      notice or lapse of time (or both) would constitute, an Event of Default under
      this Agreement or any of the other Loan Documents.

     

    3.14 Use
      of
      Proceeds.
      The
      proceeds of the Loans will be used solely for (a) working capital and other
      general corporate purposes and (b) subject to the limitations set forth in
      Section
      5.7
      of this
      Agreement, (i) the repurchase of treasury stock of the Borrowers and (ii)
      acquisitions to the extent permitted by the terms of Section
      5.3.
      

     

    3.15 Margin
      Securities.
      Under
      no circumstances will any part of the proceeds of the Loans be used directly
      or
      indirectly for the purpose, whether immediate, incidental, or ultimate, of
      purchasing, carrying or trading in any “margin stock” or any “margin securities”
(as such terms are defined respectively in Regulation T, U or X promulgated
      by
      the Board of Governors of the Federal Reserve System) or to extend credit to
      others directly or indirectly for the purpose of purchasing or carrying any
      margin stock or margin securities. Borrower is not engaged principally, or
      as
      one of its important activities, in the business of extending credit to others
      for the purpose of purchasing or carrying such margin stock or margin
      securities.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.16 Compliance
      With Laws.
      Each
      Borrower is conducting its business in material compliance with all applicable
      federal, state, and local Laws, including without limitation those pertaining
      to
      environmental matters; none of the operations of Borrowers are the subject
      of
      any federal, state or local investigation evaluating whether any material
      remedial action is needed to respond to a release of any hazardous or toxic
      waste, substance or constituent into the environment; Borrowers have not, and
      (to the best knowledge of Borrowers) no other Person has, filed any notice
      under
      any federal, state or local Law indicating that Borrowers are responsible for
      the release into the environment, or the improper storage, of any hazardous
      or
      toxic waste, substance or constituent or that such waste, substance or
      constituent has been released, or is improperly stored, upon any Property of
      Borrowers; and Borrowers do not have any material contingent liability in
      connection with the release into the environment, or the improper storage,
      of
      any waste, substance or constituent.

     

    3.17 Good
      Consideration.
      The
      Loan Documents and the transactions contemplated by the Loan Documents have
      been
      or will be executed, delivered and performed in good faith and in exchange
      for
      reasonably equivalent value.

     

    3.18 Solvency.
      Borrowers (a) are not insolvent on the date of this Agreement and will not
      become insolvent as a result of entering into the Loan Documents, (b) do not
      intend to incur Debt that will be beyond their ability to pay as such Debt
      matures. Borrowers’ assets do not constitute unreasonably small capital to carry
      out their business as conducted and as proposed to be conducted.

     

    3.19 ERISA.
      Borrowers are in compliance in all material respects with all applicable
      provisions of ERISA. Neither a Reportable Event nor a Prohibited Transaction
      has
      occurred and is continuing with respect to any Plan. No notice of intent to
      terminate a Plan has been filed, nor has any Plan been terminated. No
      circumstances exist which constitute grounds entitling the PBGC to institute
      proceedings to terminate, or appoint a trustee to administer, a Plan, nor has
      the PBGC instituted any such proceedings. No Borrower has completely or
      partially withdrawn from a Multiemployer Plan. The Borrowers have met their
      minimum funding requirements under ERISA with respect to all of their Plans,
      and
      the present value of all vested benefits under each Plan do not exceed the
      fair
      market value of all Plan assets allocable to such benefits, as determined on
      the
      most recent valuation date of the Plan and in accordance with ERISA. No Borrower
      has incurred any liability to the PBGC under ERISA.

     

    3.20 Common
      Enterprise.
      The
      successful operation and condition of each of the Borrowers is dependent on
      the
      continued successful performance of the functions of the group of Borrowers
      as a
      whole and the successful operation of each of the Borrowers are dependent on
      the
      successful performance and operation of each other Borrower. Each Borrower
      expects to derive benefit (and its board of directors or other governing body
      has determined that it may reasonably be expected to derive benefit), directly
      and indirectly, from successful operations of each of the other Borrowers.
      Each
      Borrower expects to derive benefit (and the boards of directors or other
      governing body of each Borrower has determined that it may reasonably be
      expected to derive benefit), directly and indirectly, from the credit extended
      by the Lender to Borrowers hereunder, both in their separate capacities and
      as
      members of the group of companies. Each Borrower has determined that execution,
      delivery, and performance of this Agreement and any other Loan Documents to
      be
      executed by such Borrower is within its purpose, will be of direct and indirect
      benefit to such Borrower, and is in its best interest.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.21 Depository
      Relationship.
      To
      induce the Lender to establish the interest rates provided in the Note,
      Borrowers will use Lender as its principal depository bank and the Borrowers
      covenant and agree to maintain Lender as their principal depository bank,
      including for the maintenance of business, cash management, and operating and
      administrative deposit accounts.

     

    3.22 Closed/Inactive
      Subsidiaries.
      

     

    (a) Adams
      Golf Foreign Sales Corp., Adams Golf Direct Responses, Ltd., and Adams Golf
      RAC
      Corp. have terminated their respective existences, and, as a result, are no
      longer direct or indirect Subsidiaries or Affiliates of Adams Golf,
      Inc.

     

    (b) Adams
      Golf UK, Ltd. and Adams Golf Japan, Inc. (the “Inactive Subsidiaries”) are
      inactive and do not conduct business, own any assets, or have any
      Debt.

     

    ARTICLE
      4. AFFIRMATIVE
      COVENANTS AND AGREEMENTS.
      So long
      as the Commitment is available to Borrowers and until payment and performance
      in
      full of the Note and all other Indebtedness, unless Borrowers receive prior
      written approval of a deviation therefrom from Lender, Borrowers covenant and
      agree with Lender that:

     

    4.1 Business
      and Financial Information.
      Borrowers will promptly furnish to Lender from time to time such information
      regarding the business and affairs and financial condition of Borrowers as
      Lender may reasonably request, and will furnish Lender:

     

    (a) Monthly
      Financial Statements
      - as
      soon as available and in any event within thirty (30) days after the end of
      each
      calendar month during the term of this Agreement, the consolidated balance
      sheet
      (including, without limitation, a statement of contingent liabilities) of
      Borrowers as of the close of such calendar month and the consolidated statement
      of operations, cash flows and shareholders’ equity of Borrowers for such
      calendar month, setting forth, in each case in comparative form, the figures
      for
      the corresponding periods in the previous fiscal year as well as year-to-date
      figures, all in such detail as Lender may reasonably request and accompanied
      by
      a statement of an Authorized Officer certifying that the financial statements
      fairly present the financial position of Borrowers at the close of such period
      and the results of their operations for such period;

     

    (b) Annual
      Financial Statements
      - as
      soon as available and in any event within one hundred twenty (120) days after
      the close of each fiscal year of Borrowers during the term of this Agreement,
      the audited consolidated balance sheet (including, without limitation, a
      statement of contingent liabilities) of Borrowers as at the end of such fiscal
      year and the audited consolidated statement of operations, cash flows and
      shareholders’ equity of Borrowers for such fiscal year, setting forth, in each
      case in comparative form, the figures for the previous fiscal year, all in
      reasonable detail and audited by independent certified public accountants of
      recognized national standing acceptable to Lender and accompanied by an opinion
      of such accountants (which shall not be qualified in any material respect)
      to
      the effect that such financial statements fairly present the financial condition
      and results of operations of Borrowers in accordance with GAAP consistently
      applied;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c) Filing:

     

    (i) 10-Q
      quarterly reports within forty-five (45) days of filing and Form 10-K annual
      reports within one hundred twenty (120) days of filing;

     

    (ii) any
      other
      filings made by any Borrower with the United States Securities and Exchange
      Commission and any successor thereto;

     

    (iii) copies
      of
      Borrowers’ federal income tax returns, and any amendments thereto, filed with
      the Internal Revenue Service; and

     

    (iv) any
      other
      information that is provided by Adams Golf, Inc. to its
      shareholders.

     

    (d) Notice
      of Default
      -
      immediately upon becoming aware of the existence of any event or condition
      which
      constitutes, or with notice or lapse of time (or both) would constitute, an
      Event of Default under this Agreement or any of the other Loan Documents, a
      written notice specifying the nature and period of existence of the default
      and
      what action Borrowers are taking or propose to take with respect
      thereto;

     

    (e) Notice
      of Claimed Default
      -
      immediately upon becoming aware that any Person has given notice or taken any
      other action with respect to a claimed default under any promissory note,
      contract, agreement or undertaking to which any Borrower is a party or by which
      any Property of any Borrower may be bound or subject, a written notice
      specifying the notice given or action taken by such Person and the nature of
      the
      claimed default and what action such Borrower is taking or proposes to take
      with
      respect to the claimed default;

     

    (f) Litigation
      -
      immediately upon becoming aware of any action, suit, or proceeding pending
      or
      threatened against or affecting any Borrower in any court or before any
      governmental authority, which if adversely determined could have a Material
      Adverse Effect, a written notice specifying the nature of the action, suit
      or
      proceeding and what action such Borrower is taking or proposes to take with
      respect to the action, suit or proceeding; and

     

    (g) Material
      Adverse Effect
      -
      immediately upon becoming aware of any event, condition or circumstance that
      has, or could reasonably be expected to have, a Material Adverse Effect, a
      written notice specifying the nature of the event, condition or circumstance
      and
      what action Borrowers are taking or propose to take with respect to the event,
      condition or circumstance.

     

    4.2 Compliance
      Certificate.
      Borrowers will furnish to Lender concurrently with the furnishing of the monthly
      and annual financial statements pursuant to Section
      4.1
      of this
      Agreement, a certificate in the form of certificate attached to this Agreement
      as Exhibit
      “B”
      signed
      by an Authorized Officer stating:

     

    (a) that
      a
      review of the activities of Borrowers has been made under his supervision with
      a
      view to determining whether Borrowers have fulfilled all of their obligations
      under the Loan Documents; and

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b) that
      Borrowers have fulfilled all of their obligations under the Loan Documents
      and
      that all representations made in the Loan Documents continue to be true and
      correct (or specifying the nature of any change) or if Borrowers shall be in
      default, specifying any default and the nature and status of the default and
      showing in detail the computations required by the provisions of Section
      4.14
      and
4.15
      based on
      the figures which appeared on the books of account of Borrowers at the close
      of
      the respective period.

     

    4.3 Taxes;
      Debts; Etc.
      Each
      Borrower will (a) timely file all required tax returns, (b) pay all taxes,
      assessments, and other governmental charges or levies imposed upon it or upon
      its income, profits or Property, (c) pay when due, all trade debt owed by it
      on
      ordinary trade terms to vendors, suppliers and other Persons providing goods
      and
      services used by it in the ordinary course of its business, and (d) pay and
      discharge when due, all other Debt now or subsequently owed by it, unless the
      amount or applicability thereof is being contested in good faith by appropriate
      proceedings diligently conducted, provided adequate reserves for the payment
      thereof have been established in accordance with GAAP.

     

    4.4 Maintenance
      of Existence.
      Each
      Borrower will maintain its existence, rights and franchises.

     

    4.5 Maintenance
      of Properties.
      Each
      Borrower will maintain its tangible properties, real and personal, in good
      order
      and repair at all times.

     

    4.6 Maintenance
      of Licenses, Etc..
      Each
      Borrower will maintain in full force and effect at all times, and apply in
      a
      timely manner for renewal of, all of its licenses, approvals, permits,
      franchises, patents, copyrights, trademarks, service marks, and trade names
      necessary for the continuation of the operation of its business.

     

    4.7 Compliance;
      Environmental Indemnity.
      Each
      Borrower will comply with, and conduct its business and affairs in compliance
      with, all federal, state, and local Laws, rules and governmental requirements,
      including, without limitation, those pertaining to pollution or other
      environmental matters and all ERISA requirements and obtain all permits,
      licenses, and other similar approvals required by all such Laws pertaining
      to
      the environment. Borrowers shall indemnify Lender and hold Lender harmless
      from
      and against any claim, loss or damage to which Lender is subjected as a result
      of any past, present or future existence, use, handling, storage, transportation
      or disposal of any hazardous wastes or substance or toxic substance by
      Borrowers. This indemnification shall survive the termination of this Agreement
      and the payment of the Indebtedness.

     

    4.8 Insurance.
      Borrowers will maintain insurance with responsible insurance companies on such
      of their Properties, in such amounts and against such risks, as is customarily
      maintained by similar businesses operating in the same vicinity, specifically
      to
      include a policy of fire and extended coverage insurance covering all Property,
      business interruption insurance and liability insurance, all to be with such
      companies and in such amounts satisfactory to Lender and to name Lender as
      loss
      payee, and evidence of such insurance shall be supplied to Lender.

     

    4.9 Reimbursement
      of Expenses.
      If
      Borrowers fail to pay any taxes, insurance premiums or other amounts they are
      required to pay under this Agreement, or any of the other Loan Documents, and
      Lender pays the amounts, upon such payment and demand, Borrowers will
      immediately reimburse Lender therefor and each amount paid by Lender shall
      constitute Indebtedness owed under this Agreement, shall be secured by the
      Loan
      Documents and shall accrue interest at the Maximum Rate from the date the amount
      is paid by Lender until the date the amount is repaid to Lender.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.10 Financial
      Records; Inspection.
      Borrowers will maintain a system of accounting satisfactory to Lender and in
      accordance with GAAP, and permit Lender’s officers or authorized representatives
      to visit and inspect their books of account and other reports during normal
      business hours as often as Lender may desire.

     

    4.11 Location
      of Books and Records.
      Unless
      written notice of another location is given to Lender, each Borrower will
      maintain the location of its books and records at the address of Borrower set
      forth above.

     

    4.12 Compliance
      with Agreements.
      Each
      Borrower will comply, in all material respects, with all agreements, contracts,
      and instruments binding on it or affecting its properties or business, the
      noncompliance with which could have a Material Adverse Effect.

     

    4.13 Further
      Assurances.
      The
      Borrowers will execute and deliver such further agreements and instruments
      and
      take such further action as may be reasonably requested by the Lender to carry
      out the provisions and purposes of this Agreement and the other Loan Documents
      and to create, preserve, and perfect the Liens of the Lender in the
      Collateral.

     

    4.14 Cash
      Flow Leverage Ratio.
      Borrowers will at all times during the term of this Agreement maintain a Cash
      Flow Leverage Ratio of not greater than 3.00 to 1.00; provided, after the
      consummation of an acquisition of a Subsidiary as permitted by the terms of
      Section 5.3(ii), the EBITDA of such Subsidiary may be included in the
      computation of the Cash Flow Leverage Ratio in amounts satisfactory to
      Lender.

     

    4.15 Fixed
      Charge Coverage Ratio.
      The
      Borrowers will at all times during the term of this Agreement maintain a Fixed
      Charge Coverage Ratio of not less than 1.25 to 1.0.

     

    4.16 Subsidiaries.
      Borrowers shall notify Lender in writing of Borrowers’ intention to acquire any
      Person as permitted in Section
      5.3(ii)
      of this
      Agreement and upon any such acquisition, Borrowers shall (a) cause such Person
      if it becomes a Subsidiary to execute and deliver to Lender (i) such agreements
      and documents as Lender deems necessary for the Subsidiary to be a party to
      this
      Agreement and the Note and be jointly and severally liable together with the
      Borrowers for the payment of the Indebtedness (ii) a security agreement and
      such
      other documents and agreements as Lender deems reasonably necessary, in order
      to
      grant Lender a perfected first priority security interest in all assets of
      the
      Subsidiary.

     

    4.17 Acquisition
      of Assets by Borrowers.
      Borrowers shall notify Lender in writing of Borrowers’ intention to acquire any
      assets as permitted by the terms of Section 5.3(i) of this Agreement, and if
      such acquisition is consummated and to the extent Lender does not hold a valid
      perfected first priority security interest or lien in the assets so acquired,
      Borrowers will execute and deliver to Lender such security agreements, deeds
      of
      trust, mortgages, pledges and other instruments by hypothecation as Lender
      may
      deem necessary in order to grant Lender a perfected first priority security
      interest in and/or Lien upon such assets.

     

    ARTICLE
      5. NEGATIVE
      COVENANTS. So
      long
      as the Commitment is available to Borrowers and until payment and performance
      in
      full of the Note and all other Indebtedness, unless Borrowers receive prior
      written approval of a deviation therefrom from Lender (which approval will
      not
      be unreasonably withheld), Borrowers hereby covenant and agree with Lender
      that:

     

    5.1 Liens.
      Borrowers will not grant, suffer or permit Liens on or security interests in
      any
      of their respective Properties, except Permitted Liens.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    5.2 Loans,
      Advances.
      Borrower will not make any loans, advances, capital contributions or investments
      to or in any Person, except for (a) loans, advances and investments existing
      on
      the date of this Agreement which are reflected in the Initial Financial
      Statements and (b) advances and loans among the Borrowers.

     

    5.3 Mergers,
      Etc.
      No
      Borrower will (a) amend its Charter Documents or otherwise change its name
      or
      structure, (b) reactivate any of the Inactive Subsidiaries or permit any of
      the
      Inactive Subsidiaries to conduct business, (c) form a subsidiary company, (d)
      consolidate with or merge into, or acquire any Person, (e) permit any Person
      to
      consolidate with or merge into, or acquire it, (f) acquire the Stock of any
      corporation, or (g) acquire all or substantially all of the assets and business
      of any Person or any division of any Person; provided,
      however,
      subject
      to the limitations of Section
      5.7
      of this
      Agreement the Borrowers may, at any time when no Default exists:

     

    (i) acquire
      all or substantially all of the assets of any Person provided;

     

    (aa) immediately
      after the consummation of the transaction and after giving effect thereto,
      no
      Default will exist; and

     

    (bb) the
      Borrowers have complied with the provisions of Section
      4.17
      of this
      Agreement and shall have granted Lender perfected first priority security
      interests in and Liens on the assets and properties so acquired;
      and

     

    (ii) acquire
      any Person, provided;

     

    (aa) immediately
      after the consummation of the transaction and after giving effect thereto,
      no
      Default will exist;

     

    (bb) the
      nature of the business of the Person so acquired is consistent with the current
      business operations of Borrowers;

     

    (cc) immediately
      after the consummation of the transaction, and after giving effect thereto,
      the
      Person so acquired:

     

    (1) is
      merged
      into a Borrower and such Borrower is the surviving and continuing entity;
      or

     

    (2) becomes
      a
      Subsidiary of a Borrower; and

     

    (dd) the
      Borrowers have complied with the provisions of Section
      4.16
      of this
      Agreement.

     

    5.4 Disposition
      of Assets.
      No
      Borrower will sell, lease, assign or otherwise dispose of or transfer any of
      its
      Property except (a) Equipment which is worthless or obsolete or which is
      replaced by Equipment of equal suitability and value, provided the proceeds
      of
      the sale or other disposition are delivered to Lender for application to the
      Indebtedness and (b) inventory which is sold in the ordinary course of business
      on ordinary trade terms.

     

    5.5 Dividends.
      During
      the existence of a Default, no Borrower will declare or pay any dividends or
      distributions (other than dividends payable in capital stock) on any shares
      of
      any class of capital stock, any partnership interests or other securities,
      or
      apply any of its Property or assets to the purchase, redemption or other
      retirement of any shares of any class of capital stock, any partnership interest
      or other security, or in any way amend its capital structure.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    5.6 Nature
      of Business.
      No
      Borrower will change its name, address or the general character of business
      as
      conducted on the date of this Agreement, and no Borrower will engage in any
      type
      of business not reasonably related to its business as presently and normally
      conducted.

     

    5.7 Repurchase
      of Stock and Acquisitions.
      Borrowers will not permit the consideration paid and to be paid for (a) the
      repurchase of Stock or other ownership interests of Borrowers and (b) the
      acquisitions permitted by the terms of Section
      5.3,
      to
      exceed $10,000,000.00 in the aggregate during the term of this
      Agreement.

     

    5.8 Capital
      Expenditures.
      Borrowers will not enter into any commitment to expend an amount for the
      acquisition or lease of any Property or asset whether tangible, intangible,
      fixed or capital including repairs, replacements and/or improvements, which
      are
      capitalized under GAAP which exceeds $1,000,000.00 in the aggregate during
      any
      fiscal year of Borrowers during the term of this Agreement.

     

    5.9 ERISA
      Compliance.
      Borrowers will not adopt a Plan or amend an existing Plan that results in a
      material increase of benefits. Borrowers will not at any time permit any Plan
      maintained by them to:

     

    (a) engage
      in
      any “prohibited transaction” or “reportable event”, as such terms are defined in
      ERISA;

     

    (b) incur
      any
      accumulated funding deficiency; or

     

    (c) terminate
      any Plan in a manner which could result in the imposition of Lien on any of
      its
      Property.

     

    ARTICLE
      6. EVENTS
      OF DEFAULT AND REMEDIES.

     

    6.1 Events.
      Any of
      the following events shall be considered an “Event of Default” as that term is
      used in this Agreement:

     

    (a) Borrowers
      default in the payment of any Indebtedness, whether principal or interest or
      any
      installment thereof, when due and payable;

     

    (b) any
      statement, representation or warranty of any Borrower in any of the Loan
      Documents proves to have been incorrect or incomplete in any material respect
      when made;

     

    (c) Any
      Borrower defaults in the due observance or performance of any of the covenants
      or agreements contained in Section
      2.8, 4.1, 4.2, 4.3, 4.5, 4.6, 4.7, 4.9, 4.10, 4.11, 4.12, 4.16
      or
4.17
      of this
      Agreement and such default continues unremedied for a period of thirty (30)
      days
      after notice of such default is sent by Lender to Borrowers;

     

    (d) Any
      Borrower defaults in the due observance or performance of any of the covenants
      or agreements contained in Section
      4.4, 4.8, 4.14
      or
4.15
      in
Article
      5
      of this
      Agreement or any Borrower defaults in the due observance or performance of
      any
      of its covenants or agreements contained in any of the other Loan
      Documents.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (e) any
      default or event of default occurs under any Loan Document and the same is
      not
      remedied within the applicable period of grace (if any) provided in the Loan
      Document;

     

    (f) Any
      Borrower dissolves or terminates its existence or discontinues its usual
      business or is enjoined, restrained or in any way prevented by court order
      or
      order of any governmental authority from conducting all or any material part
      of
      its business and such order is not lifted within thirty (30) days;

     

    (g) any
      involuntary case or other proceeding is commenced against any Borrower which
      seeks liquidation, reorganization or other relief with respect to it or its
      debts and liabilities under any bankruptcy, insolvency or similar law now or
      hereafter in effect or seeking the appointment of a trustee, receiver,
      liquidator, custodian or other similar official of it or any substantial part
      of
      its property, or for the winding-up or liquidation of its affairs;

     

    (h) Any
      Borrower commences a voluntary case or other proceeding seeking liquidation,
      reorganization or other relief with respect to it or its debts and liabilities
      under any bankruptcy, insolvency or other similar law now or hereafter in effect
      or seeking the appointment of a trustee, receiver, liquidator, custodian or
      other similar official of it or any substantial part of its property or consents
      to any such relief or to the appointment of or taking possession by any such
      official in an involuntary case or other proceeding commenced against it, or
      makes a general assignment for the benefit of creditors, or fails generally
      to,
      or admits in writing its inability to, pay its debts generally as they become
      due or takes any action to authorize or effect any of the
      foregoing;

     

    (i) Any
      Borrower defaults in the payment of principal of or interest on any of its
      Debt
      to any Person, the non-payment of which could have a Material Adverse Effect;
      or

     

    (j) any
      event, condition or circumstance occurs which has a Material Adverse Effect
      and
      Lender has provided Borrowers with written notice of the occurrence of such
      event, condition, or circumstance.

     

    6.2 Remedies
      Upon Default.

     

    (a) Acceleration.

     

    (i) Upon
      the
      occurrence of any Event of Default described in Section
      6.1(f), (g), or (h),
      the
      Commitment and all other lending obligations, if any, of Lender under this
      Agreement shall immediately terminate, and the total unpaid principal amount
      of
      the Note together with interest then accrued and unpaid thereon and all other
      Indebtedness shall become immediately due and payable, all without demand,
      presentment, notice of dishonor, notice of acceleration, notice of intent to
      accelerate, notice of intent to demand, protest, or other notice of default
      of
      any kind, all of which are expressly waived by Borrowers.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (ii) Upon
      the
      occurrence and at any time during the continuance of any other Event of Default
      specified in Section
      6.1,
      Lender
      may, by written notice to Borrowers, (aa) declare the total unpaid principal
      amount of the Note together with interest then accrued and unpaid thereon and
      all other Indebtedness to be immediately due and payable without demand,
      presentment, notice of dishonor, notice of acceleration, notice of intent to
      accelerate, notice of intent to demand, protest, or other notice of default
      of
      any kind, all of which are expressly waived by Borrowers, and/or (bb) terminate
      the Commitment and other lending obligations, if any, of Lender under this
      Agreement unless and until Lender shall reinstate the same in
      writing.

     

    (b) Other
      Rights.
      In
      addition, upon the occurrence of any Event of Default, Lender may, at its
      election, do any one or more of the following:

     

    (i) reduce
      any claim to judgment;

     

    (ii) exercise
      the rights of offset and/or banker’s lien and apply any and all deposits
      (general or special, time or demand, provisional or final) at any time held
      and
      other indebtedness at any time owing by Lender to or for the credit or the
      account of each Borrower against any and all of the Indebtedness, irrespective
      of whether or not Lender shall have made any demand under this Agreement or
      the
      Note and although such Indebtedness may be unmatured;

     

    (iii) foreclose
      any and all Liens in favor of Lender and/or otherwise realize upon any and
      all
      of the rights Lender may have in and to any Collateral, or any part thereof;
      or

     

    (iv) exercise
      any and all other rights afforded by any applicable laws, or by the Loan
      Documents, at law or in equity, or otherwise, including but not limited to,
      the
      rights to bring suit or other proceedings before any court of competent
      jurisdiction, either for specific performance of any covenant or condition
      contained in the Loan Documents or in aid of the exercise of any right granted
      to Lender in the Loan Documents, all as Lender shall deem appropriate in its
      sole discretion.

     

    6.3 No
      Waiver or Exhaustion.
      No
      waiver by Lender of any of its rights or remedies under this Agreement or under
      any of the Loan Documents shall be considered a waiver of any other or
      subsequent right or remedy of Lender; no delay or omission in the exercise
      or
      enforcement by Lender of any rights or remedies shall ever be construed as
      a
      waiver of any right or remedy of Lender; and no exercise or enforcement of
      any
      such rights or remedies shall ever be held to exhaust any right or remedy of
      Lender.

     

    ARTICLE
      7. CONDITIONS
      PRECEDENT.

     

    7.1 Documents
      and Other Items to be Delivered.
      Lender
      has no obligation to make the first Loan unless Lender shall have received
      all
      of the following at Lender’s office in Dallas, Texas, all in form, substance and
      date satisfactory to Lender:

     

    (a) the
      Note
      executed by Borrowers;

     

    (b) the
      following instruments (the “Security
      Instruments”):

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (i) one
      or
      more Security Agreements executed by Borrowers granting Lender a valid, first
      priority security interest in all assets, specified in such Security Agreements
      whether now owned or subsequently acquired and wherever located and the proceeds
      and products therefrom; and

     

    (ii) one
      or
      more UCC-1 Financing Statements reflecting Borrowers, as Debtor, and Lender,
      as
      Secured Party, covering the personal property described in the Security
      Agreements.

     

    (c) Release
      of Liens and UCC-3 Termination Statements executed by such Persons as Lender
      deems necessary to insure Lender’s first priority security interest in and to
      the Collateral;

     

    (d) search
      certificates from the Secretaries of States of Delaware and Texas (and, upon
      request by Lender, such other governmental authorities as may be repositories
      in
      any state, county or parish where each Borrower conducts its business or where
      any Collateral may be located), setting forth all Uniform Commercial Code
      filings, financing statements, chattel mortgages, assignments and other pledges
      of personal property and any and all mechanics’ or repairmens’ liens and
      federal, state and county tax filings against each Borrower, which certificates
      shall be in form, scope and content satisfactory to Lender and accompanied
      by
      copies of the filed financial statements, chattel mortgages and/or assignments
      and shall confirm that the Collateral is free and clear of all pledges,
      assignments, security interest and liens other than those in favor of Lender;
      

     

    (e) each
      other Closing Document executed by the appropriate Persons; 

     

    (f) Borrowers
      shall have established Lender as its principal depository bank in accordance
      with Section
      3.21
      in a
      manner acceptable to Lender; and 

     

    7.2 Additional
      Conditions Precedent.
      Lender
      has no obligation to make any Loan unless the following additional conditions
      precedent have been satisfied:

     

    (a) all
      representations and warranties made by Borrowers in the Loan Documents are
      true
      on and as of the date of the Loan as if such representations and warranties
      had
      been made as of the date of the Loan;

     

    (b) as
      of the
      date of the Loan no event or condition exists which constitutes, or with notice
      or lapse of time (or both) would constitute, an Event of Default under this
      Agreement;

     

    (c) there
      has
      been no event, condition or circumstance which has or could reasonably be
      expected to have a Material Adverse Effect; and

     

    (d) a
      duly
      executed Request for Loan has been provided to Lender.

     

    ARTICLE
      8. MISCELLANEOUS.
      

     

    8.1 Enforceability.
      If any
      provision of this Agreement is held to be unenforceable, this Agreement shall
      be
      considered divisible and inoperative as to the provision to the extent it is
      deemed to be unenforceable, and in all other respects this Agreement shall
      remain in full force and effect; provided, however, that if the provision may
      be
      made enforceable by limitations thereof, then the provision shall be enforceable
      to the maximum extent permitted by law.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.2 Performance;
      Notice.
      The
      Loan Documents are performable by Borrowers entirely in the county where
      Lender’s main office is located. Any notice required to be provided to Borrowers
      under this Agreement that is mailed postage prepaid to Borrowers c/o Adams
      Golf,
      Inc., 2801 E. Plano Parkway, Plano, Texas 75074 or at the most recent changed
      address on file with Lender at least ten (10) days before the time of the event
      to which the notice relates shall be deemed reasonable unless any longer period
      is required by Law.

     

    8.3 Expenses.
      Borrowers hereby agree to pay on demand (a) all costs and expenses of Lender
      in
      connection with the preparation, negotiation, execution and delivery of the
      Loan
      Documents and any and all amendment, modifications, renewals, extensions and
      supplements to the Loan Documents including, without limitation, the reasonable
      fees and the expenses of legal counsel for Lender, (b) all costs and expenses
      of
      Lender in connection with the enforcement of any of the Loan Documents,
      including, without limitation, the reasonable fees and the expenses of legal
      counsel for Lender, (c) all transfer, stamp, documentary or other similar taxes,
      assessments or charges levied by any governmental authority in respect of any
      of
      the Loan Documents, (d) all costs, expenses, assessments and other charges
      incurred in connection with any filing, registration, recording or perfection
      of
      any security interest or Lien contemplated by any of the Loan Documents, and
      (e)
      all other costs and expenses incurred by Lender in connection with any Loan
      Document including, without limitation, all costs, expenses and other charges
      incurred in connection with obtaining any audit or appraisal in respect of
      the
      Collateral.

     

    8.4 Successors
      and Assigns.
      The
      terms of this Agreement shall be binding upon the heirs, executors,
      administrators, personal representatives, successors and assigns of Borrowers
      and Lender. Lender reserves the right to assign the Loan Documents in whole
      or
      in part to any person or entity. In the event more than one party executes
      this
      Agreement, the obligations of the parties under this Agreement shall be joint
      and several. Section headings in this Agreement are included solely for
      convenience, are not intended to be full or accurate descriptions of the content
      thereof and shall not be construed to enlarge, limit, or otherwise change the
      express provision thereof. Pronouns in masculine, feminine, or neuter genders
      shall be construed to include any other gender, and words in the singular form
      shall be construed to include the plural and vice versa, unless the context
      otherwise requires. If the Loan Documents are given in renewal and extension
      of
      a prior obligation to Lender, all Liens and other security interests granted
      to
      secure such prior obligation, if any, are hereby carried over and renewed to
      secure the Indebtedness.

     

    8.5 Indemnification.
      BORROWERS SHALL INDEMNIFY LENDER AND ITS OFFICERS, DIRECTORS, EMPLOYEES,
      ATTORNEYS, AND AGENTS FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND
      ALL
      LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS,
      COSTS
      AND EXPENSES (INCLUDING ATTORNEYS’ FEES) TO WHICH ANY OF THEM MAY BECOME SUBJECT
      WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO (A) THE NEGOTIATION,
      EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION OR ENFORCEMENT OF ANY OF THE
      LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN DOCUMENTS,
      OR (C) ANY REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED
      IN
      ANY OF THE LOAN DOCUMENTS, EXCEPT FOR LOSSES, LIABILITIES, CLAIMS, DAMAGES,
      PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS AND EXPENSES WHICH ARE CAUSED BY
      LENDER’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.6 Applicable
      Law; Submission To Process.
      THE
      LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
      OF
      THE STATE OF TEXAS, EXCEPT TO THE EXTENT THE LOAN DOCUMENTS MAY BE GOVERNED
      BY
      THE LAWS OF THE UNITED STATES. NOTWITHSTANDING ANY PROVISION OF THIS AGREEMENT,
      THE NOTE, OR ANY OF THE OTHER LOAN DOCUMENTS TO THE CONTRARY, CHAPTER 346 OF
      THE
      TEXAS FINANCE CODE AS AMENDED SHALL NOT BE APPLICABLE TO THIS AGREEMENT, THE
      NOTE OR ANY OF THE OTHER LOAN DOCUMENTS. BORROWERS HEREBY IRREVOCABLY SUBMIT
      THEMSELVES TO THE NONEXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS
      SITTING IN THE STATE OF TEXAS AND TO THE VENUE OF DALLAS COUNTY AND AGREE AND
      CONSENT THAT SERVICE OF PROCESS MAY BE MADE UPON THEM IN ANY LEGAL PROCEEDING
      RELATING TO THIS AGREEMENT BY ANY MEANS ALLOWED UNDER TEXAS OR FEDERAL
      LAW.

     

    8.7 Limitation
      On Interest.
      It is
      expressly stipulated and agreed to be the intent of Borrowers and Lender at
      all
      times to comply with the applicable Texas law governing the maximum rate or
      amount of interest payable on the Note or the Indebtedness (or applicable United
      States Federal law to the extent that it permits Lender to contract for, charge,
      take, reserve or receive a greater amount of interest than under Texas law).
      If
      the applicable law is ever judicially interpreted so as to render usurious
      any
      amount called for under the Note or under any of the other Loan Documents,
      or
      contracted for, charged, taken, reserved or received with respect to the
      Indebtedness, or Lender’s exercise of the option to accelerate the maturity of
      the Note, or any prepayment by Borrowers results in Borrowers having paid or
      Lender having received any interest in excess of that permitted by applicable
      law, then it is Borrowers’ and Lender’s express intent that all excess amounts
      theretofore collected by Lender be credited on the principal balance of the
      Note
      and all other Indebtedness (or, if the Note and all other Indebtedness have
      been
      or would thereby be paid in full, refunded to Borrowers), and the provisions
      of
      the Note and the other Loan Documents immediately be deemed reformed and the
      amounts thereafter collectible hereunder and thereunder reduced, without the
      necessity of the execution of any new document, so as to comply with the
      applicable law, but so as to permit the recovery of the fullest amount otherwise
      called for hereunder and thereunder; provided, however, if the Note has been
      paid in full before the end of the stated term of the Note, then Borrowers
      and
      Lender agree that Lender shall, with reasonable promptness after Lender
      discovers or is advised by Borrowers that interest was received in an amount
      in
      excess of the Maximum Rate either refund such excess interest to Borrowers
      or
      credit such excess interest against any other Indebtedness then owing by
      Borrowers to Lender. Borrowers hereby agree that as a condition precedent to
      any
      claim seeking usury penalties against Lender, that Borrowers will provide
      written notice to Lender, advising Lender in reasonable detail of the nature
      and
      amount of the violation, and Lender shall have sixty (60) days after receipt
      of
      such notice in which to correct such usury violation, if any, by either
      refunding such excess interest to Borrowers or crediting such excess interest
      against any other indebtedness then owing by Borrowers to Lender. All sums
      contracted for, charged or received by Lender for the use, forbearance or
      detention of the Indebtedness shall, to the extent permitted by applicable
      law,
      be amortized or spread, using the actuarial method, throughout the stated term
      of the Indebtedness until payment in full so that the rate or amount of interest
      on account of the Indebtedness does not exceed the Maximum Rate from time to
      time in effect and applicable to the Indebtedness for so long as debt is
      outstanding. In no event shall the provisions of Chapter 346 of the Texas
      Finance Code (which regulates certain loan accounts and revolving triparty
      accounts) apply to the Indebtedness. Notwithstanding anything to the contrary
      contained herein or in any of the other Loan Documents, it is not the intention
      of Lender to accelerate the maturity of any interest that has not accrued at
      the
      time of such acceleration or to collect unearned interest at the time of such
      acceleration. To the extent that Lender is relying on Chapter 303 of the Texas
      Finance Code, as amended, of the Revised Civil Statutes of Texas to determine
      the Maximum Rate payable on the Indebtedness, Lender will utilize the weekly
      ceiling from time to time in effect as provided in Chapter 303, as amended.
      To
      the extent United States Federal law permits Lender to contract for, charge,
      take, receive or reserve a greater amount of interest than under Texas law,
      Lender will rely on United States Federal law instead of such Chapter 303,
      as
      amended, for the purpose of determining the Maximum Rate. Additionally, to
      the
      extent permitted by applicable law now or hereafter in effect, Lender may,
      at
      its option and from time to time, implement any other method of computing the
      Maximum Rate under such Chapter 303 of the Finance Code, as amended, or under
      other applicable law by giving notice, if required, to Borrowers as provided
      by
      applicable law now or hereafter in effect. Borrowers and Lender hereby agree
      that any and all suits alleging the contracting for, charging or receiving
      of
      usurious interest shall lie in Dallas County, Texas, and each irrevocably waive
      the right to venue in any other county.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.8 No
      Oral Agreements.
      THIS
      AGREEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE A WRITTEN AGREEMENT WHICH
      REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED
      BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE
      PARTIES.

     

    8.9 Construction.
      Borrowers and Lender acknowledge that each of them has had the benefit of legal
      counsel of its own choice and has been afforded an opportunity to review this
      Agreement and the other Loan Documents with its legal counsel and that this
      Agreement and the other Loan Documents shall be construed as if jointly drafted
      by Borrowers and Lender.

     

    8.10 Waiver
      Of Jury Trial.
      TO THE
      FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWERS AND LENDER HEREBY
      IRREVOCABLY AND EXPRESSLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
      PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE)
      ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS
      CONTEMPLATED THEREBY OR THE ACTIONS OF LENDER IN THE NEGOTIATION,
      ADMINISTRATION, OR ENFORCEMENT THEREOF.

     

    8.11 Participation.
      Borrowers hereby acknowledge and agree that Lender has and shall have the right
      at any time without the consent of or notice to Borrower to grant participations
      in all or part of the Indebtedness now or hereafter outstanding under this
      Agreement, the Note, or any of the other Loan Documents and any security
      interest and/or Liens on the Property of Borrowers now or hereafter granted
      by
      Borrowers to Lender as security for the payment and performance of such
      obligations. Borrowers hereby authorize Lender and each participant of Lender
      in
      the case of an Event of Default or demand for payment under this Agreement,
      to
      proceed directly by right of setoff, banker’s lien or otherwise against any
      assets of Borrowers, which may at the time of such Event of Default or demand
      for payment be in the hands of Lender or any such participant to the full extent
      of its interest in such obligations.

     

    8.12 No
      Duty Or Special Relationship.
      Borrowers acknowledge that Lender has no duty to Borrowers with respect to
      the
      loan transactions set forth in the Loan Documents except as expressly provided
      for in this Agreement and the other Loan Documents, and acknowledge that no
      fiduciary, trust, or other special relationship exists between Lender and
      Borrowers.

     

    8.13 Other
      Remedies Not Required.
      Borrower may be required to pay the Note in full without the assistance of
      any
      other party, or any collateral or security for the Note. Lender shall not be
      required to mitigate damages, file suit, or take any action to foreclose,
      proceed against or exhaust any collateral or security in order to enforce
      payment of the Note.

     

    8.14 Inconsistencies
      And Conflicts.
      To the
      extent any irreconcilable conflicts or inconsistencies exist between the terms
      of this Agreement and any of the other Loan Documents, the terms of this
      Agreement shall govern and control.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.15 Future
      Advances.
      No
      advance under the Note shall constitute a waiver of any of the conditions of
      Lender’s obligation to make further advances nor, in the event Borrowers are
      unable to satisfy any such condition, shall any such waiver have the effect
      of
      precluding Lender from thereafter declaring such inability to be a
      Default.

     

    8.16 Lender’s
      Discretion.
      All
      matters hereunder that require Lender’s discretion, (including, without
      limitation, whether Borrowers have satisfied any condition precedent), Lender
      shall use its sole and reasonable discretion, except as otherwise provided
      for
      herein. Further, Lender may in its sole discretion waive any of its rights
      with
      respect to a particular Event of Default.

     

    8.17 Business
      Loans.
      Borrowers warrant and represent to Lender, and to all other holders of any
      debt
      evidenced by the Note, that the loan evidenced by the Note is and shall be
      for
      business, commercial, investment or other similar purpose and not primarily
      for
      personal, family, household or agricultural use.

     

    8.18 Representations
      and Warranties.
      All
      representations and warranties of Borrowers herein, and all covenants and
      agreements made by Borrowers herein made before the effective date of this
      Agreement, shall survive such date.

     

    8.19 Binding
      Effect.
      All
      covenants and agreements of Borrowers under this Agreement shall bind the
      respective successors and assigns of Borrowers and shall inure to the benefit
      of
      Lender and its successors and assigns. The rights of Borrowers under this
      Agreement are not assignable.

     

    8.20 No
      Waiver.
      No
      course of dealing on the part of Lender, or its officers or employees, nor
      any
      failure or delay by Lender with respect to exercising any of its rights,
      remedies, powers or privileges hereunder shall operate as a waiver thereof.
      No
      indulgence by Lender, or waiver of compliance with any of the terms, covenants,
      or provisions of this Agreement or the other Loan Documents, shall be construed
      as a waiver of Lender’s right to subsequently require strict performance by the
      Borrowers. The rights and remedies of the Lender under this
      Agreement and
      the
      other Loan Documents shall be cumulative and the exercise or partial exercise
      of
      any such rights or remedies shall not preclude the exercise of any other rights
      or remedies.

     

    8.21 Amendment.
      Neither
      this Agreement nor any provision hereof may be changed, waived, discharged
      or
      terminated orally, but only by an instrument in writing signed by the party
      against whom enforcement of the change, waiver, discharge or termination is
      sought. 

     

    8.22 Severability.
      In the
      event any provision contained in any of the Loan Documents shall, for any
      reason, be held invalid, illegal or unenforceable in any respect, such provision
      shall be severed from the applicable Loan Document, and such invalidity,
      illegality or unenforceability shall not affect any other provision of the
      applicable Loan Document.

     

    8.23 Counterparts.
      This
      Agreement may be executed in two or more counterparts, and it shall not be
      necessary that any one counterparts be executed by all of the parties hereto.
      Each fully or partially executed counterpart shall be deemed an original, but
      all such counterparts taken together shall constitute but one and the same
      instrument.

     

    8.24 Further
      Assurances.
      Borrowers will execute and deliver such further instruments as may be deemed
      necessary or desirable by Lender to carry out the provisions and purposes of
      this Agreement and the other Loan Documents and to preserve and perfect the
      Liens of the Lender in the Collateral.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.25 Right
      of Termination.
      Borrowers shall have the right to terminate this Agreement at any time,
      provided, that there is no Indebtedness owing at the time of such
      termination.

     

    8.26 Confirmation.
      Each
      Borrower ratifies and confirms that the Security Instruments are and remain
      in
      full force and effect in accordance with their respective terms, that the
      Collateral is unimpaired by this Agreement, and that the Liens, security
      interests and other security or collateral held by Lender are hereby renewed,
      extended and carried forward to secure any and all the Indebtedness. Borrowers
      hereby agree that all applicable limitations periods with respect to the Note,
      the Security Instruments and the other Loan Documents are renewed and extended
      effective as of the date of this Agreement. Borrowers further acknowledge and
      agree that the term “Obligations”,
      as
      defined in the Security Agreement, shall include any and all Indebtedness as
      defined in this Agreement.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    WITNESS
      THE EXECUTION HEREOF,
      as of
      the 9th day of February, 2006.

     

    LENDER:

     

    BANK
      OF
      TEXAS, N.A., a national banking association

     

    By:
      /S/
      JAMES E. SANGSTER  

    Name:
      James E. Sangster

    Title:
      Senior Vice President

     

    BORROWERS:

     

    ADAMS
      GOLF, INC., a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      Chief Financial Officer

     

    ADAMS
      GOLF HOLDING CORP., a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      Vice President

     

    ADAMS
      GOLF GP CORP., a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      President

     

    ADAMS
      GOLF, LTD., a Texas limited partnership 

     

    By:
      Adams
      Golf GP Corp, a Delaware corporation,

    its
      sole
      General Partner

     

             By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      President

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ADAMS
      GOLF IP LP, a Delaware corporation

     

    By:
      Adams
      Golf GP Corp, a Delaware corporation, 

    its
      sole
      General Partner

     

             By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      President

     

    ADAMS
      GOLF MANAGEMENT CORP., a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      Vice President

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      “A”

     

    REQUEST
      FOR LOAN

     

    Reference
      is made to that certain Credit Agreement dated as of February __, 2004 (as
      from
      time to time amended, the “Agreement”), by and among Adams Golf, Inc., Adams
      Golf Holding Corp., Adams Golf GP Corp., Adams Golf, Ltd., Adams Golf IP, LP,
      and Adams Golf Management Corp. (“Borrowers”) and Bank of Texas, N.A.
      (“Lender”). Terms which are defined in the Agreement are used herein with the
      meanings given them in the Agreement. Pursuant to the terms of the Agreement,
      Borrowers hereby request Lender to make a Loan in the amount set forth below
      in
      Item (4) under the heading “Borrowing Information”.

     

    To
      induce
      Lender to make the requested Loan, Borrowers hereby represent, warrant,
      acknowledge, and agree to and with Lender that:

     

    (a) The
      officer of Borrowers signing this instrument is the duly elected, qualified
      and
      acting officer of Borrowers as indicated below such officer’s signature hereto
      having all necessary authority to act for Borrowers in making the request herein
      contained.

     

    (b) All
      representations and warranties contained in the Agreement and in each of the
      other Loan Documents are true and correct in all respects on and as of the
      date
      hereof with the same force and effect as if made on and as of such
      date.

     

    (c) All
      covenants and agreements contained in the Agreement and in each of the other
      Loan Documents to have been complied with and performed on or prior to the
      making of the requested Loan have been fully complied with and
      performed.

     

    (d) No
      Default or Event of Default has occurred and is continuing or would result
      from
      the requested Loan.

     

    (e) All
      conditions precedent to the advance of the requested Loan set forth in Article
      7
      of the Agreement have been satisfied.

     

    (f) Since
      the
      date of the latest Compliance Certificate delivered to Lender, there has been
      no
      material adverse change in the Collateral or in the business, assets,
      operations, prospects or condition, financial or otherwise, of
      Borrowers.

     

    IN
      WITNESS WHEREOF,
      this
      instrument is executed as of ____________________.

     

    [BORROWERS]

     

     

    By:
      ________________________________________

    Printed
      Name: ________________________________

    Title:
      _______________________________________

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      “B”

     

    COMPLIANCE
      CERTIFICATE

     

    Reference
      is made to the Credit Agreement (the “Agreement”) dated as of February __, 2004,
      made by and between ADAMS GOLF, INC., ADAMS GOLF HOLDING CORP., ADAMS GOLF
      GP
      CORP., ADAMS GOLF, LTD., ADAMS GOLF IP, LP, and ADAMS GOLF MANAGEMENT CORP.
      (“Borrowers”) and BANK OF TEXAS, N.A. (“Lender”). Terms which are defined in the
      Agreement are used herein with the meanings given them in the Agreement. The
      undersigned hereby certifies that he is a duly elected, qualified, and acting
      officer of Borrower, and that:

     

    (aa) a
      review
      of the activities of Borrowers has been made under his supervision with a view
      to determining whether Borrowers have fulfilled all of their obligations under
      the Agreement and the other Loan Documents;

     

    (bb) Borrowers
      have fulfilled all of their obligations under the Agreement and the other Loan
      Documents and all representations and warranties made in the Agreement and
      the
      other Loan Documents are true and correct in all material respects on and as
      of
      the date hereof with the same force and effect as though made on and as of
      the
      date hereof;

     

    (cc) no
      Default or Event of Default has occurred and is continuing as of the date
      hereof;

     

    (dd) Borrowers
      are in compliance with the terms and conditions of all leases covering property
      upon which the Collateral is located and all such leases are in full force
      and
      effect; and

     

    (ee) attached
      hereto as Schedule A is a report prepared by the undersigned setting forth
      information and calculations that demonstrate compliance (or noncompliance)
      with
      the covenants set forth in Section 4.14 and 4.15 of the Agreement.

     

    IN
      WITNESS WHEREOF,
      this
      certificate is executed as of _________________.

     

    By:
      ________________________________

    Printed
      Name: ________________________

    Title:
      _______________________________

     

    

     

    
      
        
          

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    SCHEDULE
      A

     

    Borrower
      has complied with the covenants contained in Sections
      4.14 and 4.15
      of the
      Agreement as detailed below:

     

    
      	
              (a)

            	
              Actual
                Cash Flow Leverage Ratio

            	___
              to 1.00
	 	 	 
	 	
              Required
                Cash Flow Leverage Ratio

            	3.00
              to 1.00
	 	 	 
	
              (b)

            	
              Actual
                Fixed Charge

            	___
              to 1.00
	 	 	 
	 	
              Required
                Fixed Charge1.25 to 1.00

            	 

    

     

    

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    AMENDED
      AND RESTATED PROMISSORY NOTE

     

     

    
      	$10,000,000.00
              	
              January
                23, 2006

            
	 	 

    

    FOR
      VALUE
      RECEIVED, ADAMS
      GOLF, INC.,
      a
      Delaware corporation, ADAMS
      GOLF HOLDING CORP,
      a
      Delaware corporation, ADAMS
      GOLF GP CORP,
      a
      Delaware corporation, ADAMS
      GOLF, LTD.,
      a Texas
      limited partnership, ADAMS
      GOLF IP, LP,
      a
      Delaware limited partnership, and ADAMS
      GOLF MANAGEMENT CORP,
      a
      Delaware corporation (whether one or more, “Borrower”),
      having an address at 2801 E. Plano Parkway, Plano, Texas 75074, hereby promises
      to pay to the order of BANK
      OF TEXAS, N.A.,
      a
      national banking association (together with its successors and assigns and
      any
      subsequent holders of this Promissory Note, the “Lender”),
      as
      hereinafter provided, the principal sum of TEN MILLION AND NO/100 DOLLARS
      ($10,000,000.00) or so much thereof as may be advanced by Lender from time
      to
      time hereunder to or for the benefit or account of Borrower, together with
      interest thereon at the Note Rate (as hereinafter defined), and otherwise in
      strict accordance with the terms and provisions hereof.

     

    ARTICLE
      9. 

     

    DEFINITIONS

     

    9.1 Definitions.
      As used
      in this Promissory Note, the following terms shall have the following
      meanings:

     

    Applicable
      Margin:
      The
      Applicable Margin is the percent per annum set forth below, based on Borrower’s
      Cash Flow Coverage Ratio as set forth in the most recent compliance certificate
      received by Lender:

     

    Applicable
      Margin

    
      	 	 	
               

            
	
              [Ratio]

            	
              For
                Prime Rate

            	
              For
                LIBOR

            
	
              Equal
                to or less than 1.00 to 1.00

            	
              -1.00%

            	
              1.50%

            
	
              Greater
                than 1.00 to 1.00 but less than 1.50 to 1.00

            	
              -0.75%

            	
              1.75%

            
	
              Equal
                to 1.50 to 1.00 but less than 2.00 to 1.00

            	
              -0.50%

            	
              2.00%

            
	
              Equal
                to 2.00 to 1.00 but less than 2.50 to 1.00

            	
              -0.25%

            	
              2.25%

            
	
              Equal
                to 2.50 to 1.00 but less than 3.00 to 1.00

            	
              0.0%

            	
              2.50%

            

    

     

    The
      Applicable Margin will be determined from Borrower’s most recent compliance
      certificate (or if no compliance certificate is required, Borrower’s most recent
      financial statements) received by Lender. The Applicable Margin will be in
      effect from the first day of the month following receipt of that certificate
      or
      financial statement until the first day of the month following receipt of the
      next compliance certificate or financial statement. Until Lender receives the
      first certificate or financial statement, the Applicable Margin will be -1.00%
      for Base Rate loans and 1.50% for LIBOR loans. Thereafter if any compliance
      certificate or financial statement is not delivered on time, the Applicable
      Margin from the date such certificate or financial statement was due until
      Lender receives it will be the highest level set forth above.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Applicable
      Rate:
      (i) In
      the case of a Portion bearing interest based upon the Base Rate, the Base Rate
      plus the Applicable Margin and (ii) in the case of a Portion bearing interest
      based upon LIBOR, LIBOR plus the Applicable Margin.

     

    Base
      Rate:
      For any
      day, a rate of interest equal to the Prime Rate for such day.

     

    Borrower:
      As
      identified in the introductory paragraph of this Note.

     

    Business
      Day:
      A
      weekday, Monday through Friday, except a legal holiday or a day on which banking
      institutions in Dallas, Texas are authorized or required by law to be closed.
      Unless otherwise provided, the term “days”
when
      used herein shall mean calendar days.

     

    Change:
      (i) any
      change after the date of this Note in the risk-based capital guidelines
      applicable to Lender or (ii) any adoption of or change in any other law,
      governmental or quasi-governmental rule, regulation, policy, guideline,
      interpretation, or directive (whether or not having the force of law) after
      the
      date of this Note that affects capital adequacy or the amount of capital
      required or expected to be maintained by Lender or any entity controlling
      Lender.

     

    Charges:
      All
      fees, charges and/or any other things of value, if any, contracted for, charged,
      taken, received or reserved by Lender in connection with the transactions
      relating to this Note and the other Loan Documents, which are treated as
      interest under applicable law.

     

    Debtor
      Relief Laws:
      Title 11 of the United States Code, as now or hereafter in effect, or any
      other applicable law, domestic or foreign, as now or hereafter in effect,
      relating to bankruptcy, insolvency, liquidation, receivership, reorganization,
      arrangement or composition, extension or adjustment of debts, or similar laws
      affecting the rights of creditors.

     

    Default
      Interest Rate:
      A rate
      per annum equal to the Note Rate plus three percent (3%), but in no event in
      excess of the Maximum Rate.

     

    Event
      of Default:
      As
      defined in the Loan Agreement.

     

    Funding
      Indemnification:
      The
      amount (which shall be payable on Lender’s written demand notwithstanding any
      contrary provision in this Note) necessary to promptly compensate Lender for,
      and hold it harmless from, any loss, cost or expense incurred by it as a result
      of:

     

    (a) any
      payment or prepayment of any Portion bearing interest based upon LIBOR on a
      day
      other than the last day of the relevant LIBOR Interest Period (whether
      voluntary, mandatory, automatic, by reason of acceleration, or otherwise);
      or

     

    (b) any
      failure by Borrower to prepay, borrow, continue or convert a Portion bearing
      or
      selected to bear interest based upon LIBOR on the date or in the amount selected
      by Borrower,

     

    including
      any loss of anticipated profits and any loss or expense arising from the
      liquidation or reemployment of funds obtained by it to maintain such portion
      or
      from fees payable to terminate the deposits from which such funds were obtained.
      Borrower shall also pay any customary administrative fees charged by Lender
      in
      connection with the foregoing. For purposes of calculating amounts payable
      by
      Borrower to Lender hereunder, Lender shall be deemed to have funded the Portion
      based upon LIBOR by a matching deposit or other borrowing in the London
      inter-bank market for a comparable amount and for a comparable period, whether
      or not such Portion was in fact so funded.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Lender:
      As
      identified in the introductory paragraph of this Note.

     

    LIBOR
      Banking Day:
      Any day
      on which commercial banks in the City of London, England are open for business
      and dealing in offshore dollars.

     

    LIBOR
      Determination Date:
      A day
      that is three LIBOR Banking Days prior to the beginning of the relevant LIBOR
      Interest Period.

     

    LIBOR
      Interest Period:
      A
      period of one, two or three months. The first day of the interest period must
      be
      a LIBOR Banking Day. The last day of the interest period and the actual number
      of days during the interest period will be determined by Lender using the
      practices of the London inter-bank market.

     

    LIBOR:
      With
      respect to each LIBOR Interest Period, the rate (expressed as a percentage
      per
      annum and adjusted as described in the last sentence of this definition of
      LIBOR) for deposits in United States Dollars that appears on Telerate Page
      3750
      (or the successor thereto) as of 11:00 a.m., London, England time, on the
      related LIBOR Determination Date. If such rate does not appear on such screen
      or
      service, or such screen or service shall cease to be available, LIBOR shall
      be
      determined by Lender to be the offered rate on such other screen or service
      that
      displays an average British Bankers Association Interest Settlement Rate for
      deposits in United States Dollars (for delivery on the first day of such LIBOR
      Interest Period) for a term equivalent to such LIBOR Interest Period as of
      11:00
      a.m. on the relevant LIBOR Determination Date. If the rates referenced in the
      two preceding sentences are not available, LIBOR for the relevant LIBOR Interest
      Period will be determined by such alternate method or reasonably selected by
      Lender. LIBOR shall be adjusted from time to time in Lender’s sole discretion
      for then-applicable reserve requirements, deposit insurance assessment rates,
      marginal emergency, supplemental, special and other reserve percentages, and
      other regulatory costs.

     

    Loan
      Agreement:
      The
      Amended and Restated Credit Agreement of even date herewith executed by Lender
      and Borrower.

     

    Loan
      Documents:
      As
      defined in the Loan Agreement.

     

    Maturity
      Date:
      January
      23, 2009.

     

    Maximum
      Rate:
      As
      defined in the Loan Agreement.

     

    Note:
      This
      Promissory Note.

     

    Note
      Rate:
      The
      rate equal to the lesser of (a) the Maximum Rate or (b) the Applicable
      Rate.

     

    Payment
      Date:
      The
      first day of each and every January, April, July and October during the term
      of
      this Note and the last day of each LIBOR Interest Period.

     

    Portion:
      Any
      principal amount bearing interest based upon the Base Rate or
      LIBOR.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Prime
      Rate:
      The
      rate of interest per annum set and published by BOK Financial Corporation on
      a
      daily basis from time to time as the BOKF National Prime Rate. The Prime Rate
      is
      not necessarily the lowest rate charged by Lender on its loans and is set by
      Lender in its sole discretion. If
      such
      prime rate shall cease to be published or is published infrequently or
      sporadically, then the Prime Rate shall be the rate of interest per annum
      established from time to time by Lender and designated as its base or prime
      rate, which may not necessarily be the lowest interest rate charged by Lender,
      and is set by Lender in its sole discretion. Borrower
      understands that Lender may make loans based on other rates as
      well.

     

    Related
      Indebtedness:
      Any and
      all indebtedness paid or payable by Borrower to Lender pursuant to the Loan
      Documents or any other communication or writing by or between Borrower and
      Lender related to the transaction or transactions that are the subject matter
      of
      the Loan Documents, except such indebtedness which has been paid or is payable
      by Borrower to Lender under this Note.

     

    Any
      capitalized term used in this Note and not otherwise defined herein shall have
      the meaning ascribed to each such term in the Loan Agreement. All terms used
      herein, whether or not defined in Section 1.1
      hereof,
      and whether used in singular or plural form, shall be deemed to refer to the
      object of such term whether such is singular or plural in nature, as the context
      may suggest or require.

     

    ARTICLE
      10. 

     

    PAYMENT
      TERMS

     

    10.1 Payment
      of Principal and Interest.
      All
      accrued but unpaid interest on the principal balance of this Note outstanding
      from time to time shall be payable on each Payment Date commencing April 1,
      2006. The then outstanding principal balance of this Note and all accrued but
      unpaid interest thereon shall be due and payable on the Maturity Date. Borrower
      may from time to time during the term of this Note borrow, partially or wholly
      repay its outstanding borrowings, and reborrow, subject to all of the
      limitations, terms and conditions of this Note and of the Loan Documents;
      provided however, that the total outstanding borrowings under this Note shall
      not at any time exceed the principal amount stated above. The unpaid principal
      balance of this Note at any time shall be the total amounts advanced hereunder
      by Lender less the amount of principal payments made hereon by or for Borrower,
      which balance may be endorsed hereon from time to time by Lender or otherwise
      noted in Lender’s records, which notations shall be, absent manifest error,
      conclusive evidence of the amounts owing hereunder from time to
      time.

     

    10.2 Application.
      Except
      as expressly provided herein to the contrary, all payments on this Note shall
      be
      applied in the following order of priority: (i) the payment or
      reimbursement of any expenses, costs or obligations (other than the outstanding
      principal balance hereof and interest hereon) for which either Borrower shall
      be
      obligated or Lender shall be entitled pursuant to the provisions of this Note
      or
      the other Loan Documents, (ii) the payment of accrued but unpaid interest
      hereon, and (iii) the payment of all or any portion of the principal
      balance hereof then outstanding hereunder, in the direct order of maturity.
      If
      an Event of Default exists under this Note or under any of the other Loan
      Documents, then Lender may, at the sole option of Lender, apply any such
      payments, at any time and from time to time, to any of the items specified
      in
      clauses (i), (ii) or (iii) above without regard to the order of priority
      otherwise specified in this Section
      2.2
      and any
      application to the outstanding principal balance hereof may be made in either
      direct or inverse order of maturity.

     

    10.3 Payments.
      All
      payments under this Note made to Lender shall be made in immediately available
      funds at 5956 Sherry Lane, Suite 1100, Dallas, Texas 75225 (or at such other
      place as Lender, in Lender’s sole discretion, may have established by delivery
      of written notice thereof to Borrower from time to time), without offset, in
      lawful money of the United States of America, which shall at the time of payment
      be legal tender in payment of all debts and dues, public and private. Payments
      by check or draft shall not constitute payment in immediately available funds
      until the required amount is actually received by Lender in full. Payments
      in
      immediately available funds received by Lender in the place designated for
      payment on a Business Day prior to 11:00 a.m. Dallas, Texas time at said place
      of payment shall be credited prior to the close of business on the Business
      Day
      received, while payments received by Lender on a day other than a Business
      Day
      or after 11:00 a.m. Dallas, Texas time on a Business Day shall not be credited
      until the next succeeding Business Day. If any payment of principal or interest
      on this Note shall become due and payable on a day other than a Business Day,
      such payment shall be made on the next succeeding Business Day. Any such
      extension of time for payment shall be included in computing interest which
      has
      accrued and shall be payable in connection with such payment.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    10.4 Rate
      Selection, Etc.
      Borrower
      may select, subject to the terms and conditions set forth below, a Note Rate
      based upon either LIBOR or the Base Rate for the entire principal amount of
      this
      Note then outstanding or any Portion thereof. No more than three LIBOR Interest
      Periods may be outstanding at any time, and each Portion bearing interest based
      on LIBOR shall be at least $500,000.00. Borrower may designate the Portion
      to
      bear interest based upon LIBOR by giving Lender written notice of its selection
      before 11:00 a.m. (Dallas, Texas time) on the LIBOR Determination Date, which
      selection shall be irrevocable, for each LIBOR Interest Period. If an Event
      of
      Default has occurred and is continuing, the option to select LIBOR as a basis
      for the Note Rate shall be terminated. No LIBOR Interest Period may extend
      beyond the Maturity Date. Any Portion for which LIBOR Interest Period is not
      selected shall bear interest at a Note Rate based upon the Base Rate. The
      determination by Lender of the Note Rate shall, in the absence of manifest
      error, be conclusive and binding in all respects. Notwithstanding anything
      contained herein to the contrary, if (i) at any time, Lender determines
      (which determination shall be conclusive in the absence of manifest error)
      that
      any applicable law or regulation or any change therein or the interpretation
      or
      application thereof or compliance therewith by Lender (A) prohibits,
      restricts or makes impossible the charging of interest based on LIBOR or
      (B) shall make it unlawful for Lender to make or maintain the indebtedness
      evidenced by this Note in eurodollars, or (ii) at the time of or prior to
      the determination of the Note Rate, Lender determines (which determination
      shall
      be conclusive in the absence of manifest error) that by reason of circumstances
      affecting the London interbank market generally, (A) deposits in United
      States Dollars in the relevant amounts and of the relevant maturity are not
      available to Lender in the London interbank market, (B) the Note Rate does
      not adequately and fairly reflect the cost to Lender of making or maintaining
      the loan, due to changes in administrative costs, fees, tariffs and taxes and
      other matters outside of Lender’s reasonable control, or (C) adequate and
      fair means do not or will not exist for determining the Note Rate as set forth
      in this Note, then Lender shall give Borrower prompt notice thereof, and this
      Note shall bear interest, and continue to bear interest until Lender determines
      that the applicable circumstance described in the foregoing clauses
      (i) (A) or (B) or (ii) (A), (B) or (C)
      no
      longer pertains, at the Base Rate plus Applicable Margin.

     

    10.5 Computation
      Period.
      Interest on the indebtedness evidenced by this Note shall be computed on the
      basis of a three hundred sixty (360) day year and shall accrue on the actual
      number of days elapsed for any whole or partial month in which interest is
      being
      calculated. In computing the number of days during which interest accrues,
      the
      day on which funds are initially advanced shall be included regardless of the
      time of day such advance is made, and the day on which funds are repaid shall
      be
      included unless repayment is credited prior to the close of business on the
      Business Day received as provided in Section 2.3
      hereof.

     

    10.6 Prepayment.
      Borrower shall have the right to prepay, at any time and from time to time
      without fee, premium or penalty (except as noted below), all or any Portion
      of
      the outstanding principal balance hereof, provided, however, that (a) such
      prepayment shall also include any and all accrued but unpaid interest on the
      amount of principal being so prepaid through and including the date of
      prepayment, plus any other sums which have become due to Lender under the other
      Loan Documents on or before the date of prepayment, but which have not been
      fully paid and (b) any Funding Indemnification. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    10.7 Unconditional
      Payment.
      Borrower is and shall be obligated to pay all principal, interest and any and
      all other amounts which become payable under this Note or under any of the
      other
      Loan Documents absolutely and unconditionally and without any abatement,
      postponement, diminution or deduction whatsoever and without any reduction
      for
      counterclaim or setoff whatsoever. If at any time any payment received by Lender
      hereunder shall be deemed by a court of competent jurisdiction to have been
      a
      voidable preference or fraudulent conveyance under any Debtor Relief Law, then
      the obligation to make such payment shall survive any cancellation or
      satisfaction of this Note or return thereof to Borrower and shall not be
      discharged or satisfied with any prior payment thereof or cancellation of this
      Note, but shall remain a valid and binding obligation enforceable in accordance
      with the terms and provisions hereof, and such payment shall be immediately
      due
      and payable upon demand.

     

    10.8 Partial
      or Incomplete Payments.
      Remittances in payment of any part of this Note other than in the required
      amount in immediately available funds at the place where this Note is payable
      shall not, regardless of any receipt or credit issued therefor, constitute
      payment until the required amount is actually received by Lender in full in
      accordance herewith and shall be made and accepted subject to the condition
      that
      any check or draft may be handled for collection in accordance with the practice
      of the collecting bank or banks. Acceptance by Lender of any payment in an
      amount less than the full amount then due shall be deemed an acceptance on
      account only, and the failure to pay the entire amount then due shall be and
      continue to be an Event of Default in the payment of this Note.

     

    10.9 Default
      Interest Rate, etc.
      For so
      long as any Event of Default exists under this Note or under any of the other
      Loan Documents, regardless of whether or not there has been an acceleration
      of
      the indebtedness evidenced by this Note, and at all times after the maturity
      of
      the indebtedness evidenced by this Note (whether by acceleration or otherwise),
      and in addition to all other rights and remedies of Lender hereunder, interest
      shall accrue on the outstanding principal balance hereof at the Default Interest
      Rate, and such accrued interest shall be immediately due and payable. Borrower
      acknowledges that it would be extremely difficult or impracticable to determine
      Lender’s actual damages resulting from any late payment or Event of Default, and
      such late charges and accrued interest are reasonable estimates of those damages
      and do not constitute a penalty. If Lender determines that the amount of capital
      required or expected to be maintained by Lender or any entity controlling
      Lender, is increased as a result of a Change, then, within fifteen (15) days
      of
      demand by Lender, Borrower shall pay to Lender the amount necessary to
      compensate for any shortfall in the rate of return on the portion of such
      increased capital that Lender determines is attributable to this Note or the
      principal amount outstanding hereunder (after taking into account Lender’s
      policies as to capital adequacy).

     

    ARTICLE
      11. 

     

    EVENT
      OF DEFAULT AND REMEDIES

     

    11.1 Event
      of Default.
      The
      occurrence or happening, at any time and from time to time, of any event or
      condition which constitutes an Event of Default under the Loan Agreement shall
      immediately constitute an “Event of Default” under this Note.

     

    11.2 Remedies.
      Upon
      the occurrence of an Event of Default, Lender shall have the immediate right
      to
      exercise any and all rights and remedies afforded Lender under the Loan
      Documents, at law, or in equity.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ARTICLE
      12. 

     

    GENERAL
      PROVISIONS

     

    12.1 No
      Waiver; Amendment.
      No
      failure to accelerate the indebtedness evidenced by this Note by reason of
      an
      Event of Default hereunder, acceptance of a partial or past due payment, or
      indulgences granted from time to time shall be construed (i) as a novation
      of
      this Note or as a reinstatement of the indebtedness evidenced by this Note
      or as
      a waiver of such right of acceleration or of the right of Lender thereafter
      to
      insist upon strict compliance with the terms of this Note, or (ii) to prevent
      the exercise of such right of acceleration or any other right granted under
      this
      Note, under any of the other Loan Documents or by any applicable laws. Borrower
      hereby expressly waives and relinquishes the benefit of any statute or rule
      of
      law or equity now provided, or which may hereafter be provided, which would
      produce a result contrary to or in conflict with the foregoing. The failure
      to
      exercise any remedy available to Lender shall not be deemed to be a waiver
      of
      any rights or remedies of Lender under this Note or under any of the other
      Loan
      Documents, or at law or in equity. No extension of the time for the payment
      of
      this Note or any installment due hereunder, made by agreement with any person
      now or hereafter liable for the payment of this Note, shall operate to release,
      discharge, modify, change or affect the original liability of Borrower under
      this Note, either in whole or in part, unless Lender specifically, unequivocally
      and expressly agrees otherwise in writing. This Note may not be changed orally,
      but only by an agreement in writing signed by the party against whom enforcement
      of any waiver, change, or modification is sought.

     

    12.2 Waivers.
      EXCEPT AS SPECIFICALLY PROVIDED IN THE LOAN DOCUMENTS TO THE CONTRARY, BORROWER
      AND ANY ENDORSERS OR GUARANTORS HEREOF SEVERALLY WAIVE AND RELINQUISH
      PRESENTMENT FOR PAYMENT, DEMAND, NOTICE OF NONPAYMENT OR NONPERFORMANCE,
      PROTEST, NOTICE OF PROTEST, NOTICE OF INTENT TO ACCELERATE, NOTICE OF
      ACCELERATION OR ANY OTHER NOTICES OR ANY OTHER ACTION. BORROWER AND ANY
      ENDORSERS OR GUARANTORS HEREOF SEVERALLY WAIVE AND RELINQUISH, TO THE FULLEST
      EXTENT PERMITTED BY LAW, ALL RIGHTS TO THE BENEFITS OF ANY MORATORIUM,
      REINSTATEMENT, MARSHALING, FORBEARANCE, VALUATION, STAY, EXTENSION, REDEMPTION,
      APPRAISEMENT, EXEMPTION AND HOMESTEAD NOW OR HEREAFTER PROVIDED BY THE
      CONSTITUTION AND LAWS OF THE UNITED STATES OF AMERICA AND OF EACH STATE THEREOF,
      BOTH AS TO ITSELF AND IN AND TO ALL OF ITS PROPERTY, REAL AND PERSONAL, AGAINST
      THE ENFORCEMENT AND COLLECTION OF THE OBLIGATIONS EVIDENCED BY THIS NOTE OR
      BY
      THE OTHER LOAN DOCUMENTS.

     

    12.3 Interest
      Provisions.
      

     

    (a) Savings
      Clause.
      This
      Note is expressly made subject to the provisions of the Loan Agreement which
      more fully set out the limitations on how interest accrues hereon.

     

    (b) Ceiling
      Election.
      To the
      extent that Lender is relying on Chapter 303 of the Texas Finance Code to
      determine the Maximum Rate payable on the Note and/or any other portion of
      the
      Indebtedness, Lender will utilize the weekly ceiling from time to time in effect
      as provided in such Chapter 303, as amended. To the extent United States
      federal law permits Lender to contract for, charge, take, receive or reserve
      a
      greater amount of interest than under Texas law, Lender will rely on United
      States federal law instead of such Chapter 303 for the purpose of
      determining the Maximum Rate. Additionally, to the extent permitted by
      applicable law now or hereafter in effect, Lender may, at its option and from
      time to time, utilize any other method of establishing the Maximum Rate under
      such Chapter 303 or under other applicable law by giving notice, if
      required, to Borrower as provided by applicable law now or hereafter in
      effect.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    12.4 Further
      Assurances and Corrections.
      From
      time to time, at the request of Lender, Borrower will (i) promptly correct
      any defect, error or omission which may be discovered in the contents of this
      Note or in any other Loan Document or in the execution or acknowledgment
      thereof; (ii) execute, acknowledge, deliver, record and/or file (or cause
      to be executed, acknowledged, delivered, recorded and/or filed) such further
      documents and instruments (including, without limitation, further deeds of
      trust, security agreements, financing statements, continuation statements and
      assignments of rents) and perform such further acts and provide such further
      assurances as may be necessary, desirable, or proper, in Lender’s opinion,
      (A) to carry out more effectively the purposes of this Note and the Loan
      Documents and the transactions contemplated hereunder and thereunder, (B) to
      confirm the rights created under this Note and the other Loan Documents, (C)
      to
      protect and further the validity, priority and enforceability of this Note
      and
      the other Loan Documents and the liens and security interests created thereby,
      and (D) to subject to the Loan Documents any property of Borrower intended
      by
      the terms of any one or more of the Loan Documents to be encumbered by the
      Loan
      Documents; and (iii) pay all costs in connection with any of the
      foregoing.

     

    12.5 Governing
      Law.
      This
      Note shall be governed by and construed in accordance with the laws of the
      State
      of Texas.

     

    12.6 Counting
      of Days.
      If any
      time period referenced hereunder ends on a day other than a Business Day, such
      time period shall be deemed to end on the next succeeding Business
      Day.

     

    12.7 Relationship
      of the Parties.
      Notwithstanding any prior business or personal relationship between Borrower
      and
      Lender, or any officer, director or employee of Lender, that may exist or have
      existed, the relationship between Borrower and Lender is solely that of debtor
      and creditor, Lender has no fiduciary or other special relationship with
      Borrower, Borrower and Lender are not partners or joint venturers, and no term
      or condition of any of the Loan Documents shall be construed so as to deem
      the
      relationship between Borrower and Lender to be other than that of debtor and
      creditor.

     

    12.8 Successors
      and Assigns.
      The
      terms and provisions hereof shall be binding upon and inure to the benefit
      of
      Borrower and Lender and their respective heirs, executors, legal
      representatives, successors, successors-in-title and assigns, whether by
      voluntary action of the parties, by operation of law or otherwise, and all
      other
      persons claiming by, through or under them. The terms “Borrower” and “Lender” as
      used hereunder shall be deemed to include their respective heirs, executors,
      legal representatives, successors, successors-in-title and assigns, whether
      by
      voluntary action of the parties, by operation of law or otherwise, and all
      other
      persons claiming by, through or under them.

     

    12.9 Joint
      and Several Liability.
      If
      Borrower consists of more than one person or entity, each shall be jointly
      and
      severally liable to perform the obligations of Borrower under this
      Note.

     

    12.10 Time
      is of the Essence.
      Time is
      of the essence with respect to all provisions of this Note and the other Loan
      Documents.

     

    12.11 Headings.
      The
      Article, Section, and Subsection entitlements hereof are inserted for
      convenience of reference only and shall in no way alter, modify, define, limit,
      amplify or be used in construing the text, scope or intent of such Articles,
      Sections, or Subsections or any provisions hereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    12.12 Controlling
      Agreement.
      In the
      event of any conflict between the provisions of this Note and the Loan
      Agreement, it is the intent of the parties hereto that the provisions of the
      Loan Agreement shall control. In the event of any conflict between the
      provisions of this Note and any of the other Loan Documents (other than the
      Loan
      Agreement), it is the intent of the parties hereto that the provisions of this
      Note shall control. The parties hereto acknowledge that they were represented
      by
      competent counsel in connection with the negotiation, drafting and execution
      of
      this Note and the other Loan Documents and that this Note and the other Loan
      Documents shall not be subject to the principle of construing their meaning
      against the party which drafted same.

     

    12.13 Notices.
      All
      notices or other communications required or permitted to be given pursuant
      to
      this Note and the other Loan Documents shall be in writing and shall be
      considered as properly given if (i) mailed by first class United States
      mail, postage prepaid, registered or certified with return receipt requested,
      (ii) by delivering same in person to the intended addressee, (iii) by
      delivery to a reputable independent third party commercial delivery service
      for
      same day or next day delivery and providing for evidence of receipt at the
      office of the intended addressee, or (iv) by prepaid telegram, telex,
      telecopier or facsimile transmission to the addressee. Notice so mailed shall
      be
      effective upon its deposit with the United States Postal Service or any
      successor thereto; notice sent by such a commercial delivery service shall
      be
      effective upon delivery to such commercial delivery service; notice given by
      personal delivery shall be effective only if and when received by the addressee;
      and notice given by other means shall be effective only if and when received
      at
      the office or designated place or machine of the intended addressee. For
      purposes of notice, the addresses of the parties shall be as set forth herein;
      provided, however, that either party shall have the right to change its address
      for notice hereunder to any other location within the continental United States
      by the giving of thirty (30) days’ prior notice to the other party in the
      manner set forth herein.

     

    12.14 Costs
      of Collection.
      If any
      holder of this Note retains an attorney-at-law in connection with any Event
      of
      Default or at maturity or to collect, enforce, or defend this Note or any part
      hereof, or any other Loan Document in any lawsuit or in any probate,
      reorganization, bankruptcy or other proceeding, or if Borrower sues any holder
      in connection with this Note or any other Loan Document and does not prevail,
      then Borrower agrees to pay to each such holder, in addition to the principal
      balance hereof and all interest hereon, all costs and expenses of collection
      or
      incurred by such holder or in any such suit or proceeding, including, but not
      limited to, reasonable attorneys’ fees.

     

    12.15 Gender.
      All
      personal pronouns used herein, whether used in the masculine, feminine or neuter
      gender, shall include all other genders; the singular shall include the plural
      and vice versa.

     

    12.16 Statement
      of Unpaid Balance.
      At any
      time and from time to time, Borrower will furnish promptly, upon the request
      of
      Lender, a written statement or affidavit, in form satisfactory to Lender,
      stating the unpaid balance of the indebtedness evidenced by this Note and the
      Related Indebtedness and that there are no offsets or defenses against full
      payment of the indebtedness evidenced by this Note and the Related Indebtedness
      and the terms hereof, or if there are any such offsets or defenses, specifying
      them.

     

    12.17 Entire
      Agreement.
      THIS
      NOTE AND THE OTHER LOAN DOCUMENTS CONTAIN THE FINAL, ENTIRE AGREEMENT BETWEEN
      THE PARTIES HERETO RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND ALL
      PRIOR AGREEMENTS, WHETHER WRITTEN OR ORAL, RELATIVE HERETO AND THERETO WHICH
      ARE
      NOT CONTAINED HEREIN OR THEREIN ARE SUPERSEDED AND TERMINATED HEREBY, AND THIS
      NOTE AND THE OTHER LOAN DOCUMENTS MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE
      OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE
      PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES
      HERETO.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    12.18 Amendment
      and Restatement.
      This
      Note is executed, in part, in amendment and restatement and not in novation
      of
      that certain promissory note dated April 13, 2005, in the stated principal
      amount of $5,000,000.00 executed by Borrower and payable to Lender and, in
      part,
      to evidence additional Loans to Borrower.

     

     

     

    [NO
      FURTHER TEXT ON THE REMAINDER OF THE PAGE]

     

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, Borrower, intending to be legally bound hereby, has duly
      executed this Note as of the day and year first written above.

     

    BORROWERS:

     

    ADAMS
      GOLF, INC., a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      Chief Financial Officer

     

    ADAMS
      GOLF HOLDING CORP, a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      Vice President

     

    ADAMS
      GOLF GP CORP, a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      President

     

    ADAMS
      GOLF, LTD., a Texas limited partnership 

     

    By:
      Adams
      Golf GP Corp, a Delaware corporation,

    its
      sole
      General Partner

     

             By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      President

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ADAMS
      GOLF IP LP, a Delaware corporation

     

    By:
      Adams
      Golf GP Corp, a Delaware corporation, 

    its
      sole
      General Partner

     

             By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      President

     

    ADAMS
      GOLF MANAGEMENT CORP., a Delaware corporation

     

    By:
      /S/
      ERIC T. LOGAN

    Name:
      Eric Logan

    Title:
      Vice President

     

    Address
      of Lender for purposes

    of
      notice hereunder:

     

    Bank
      of
      Texas, N.A.

    5956
      Sherry Lane, Suite 1100

    Dallas,
      Texas 75225

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