10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2005

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT of 1934

For the transition period from                      to                     

Commission File Number: 0-19599

WORLD ACCEPTANCE CORPORATION

(Exact name of registrant as specified in its charter.)

South Carolina	57-0425114
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

108 Frederick Street

Greenville, South Carolina 29607

(Address of principal executive offices)

(Zip Code)

(864) 298-9800

(registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period than the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

x  Yes    ¨  No

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

x  Yes    ¨  No

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of The Exchange Act).

¨  Yes    x  No

Indicate the number of shares outstanding of each of issuer’s classes of common stock, as of the latest practicable date, November 11, 2005.

Common Stock, no par value	18,302,500
(Class)	(Outstanding)

1

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION		Page
Item 1.	Consolidated Financial Statements (unaudited):
	Consolidated Balance Sheets as of September 30, 2005 and March 31, 2005	3
	Consolidated Statements of Operations for the six months ended September 30, 2005 and September 30, 2004	4
	Consolidated Statements of Shareholders’ Equity for the six months ended September 30, 2005	5
	Consolidated Statements of Cash Flows for the six months ended September 30, 2005 and September 30, 2004	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16
Item 4.	Controls and Procedures	16
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	16
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 4.	Submission of Matters to a Vote of Security Holders	17
Item 6.	Exhibits	19
Signatures		21

2

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30, 2005			March 31, 2005
ASSETS
Cash	$	4,242,724		3,046,677
Gross loans receivable		395,577,728		351,496,149
Less:
Unearned interest and fees		(99,168,718	)	(84,472,686	)
Allowance for loan losses		(22,223,421	)	(20,672,740	)
Loans receivable, net		274,185,589		246,350,723
Property and equipment, net		10,738,489		9,806,237
Deferred tax benefit		10,690,000		10,690,000
Other assets, net		5,986,420		6,254,360
Intangible assets, net		17,116,809		17,358,505
Total assets	$	322,960,031		293,506,502
LIABILITIES & SHAREHOLDERS’ EQUITY
Liabilities:
Senior notes payable		121,600,000		82,900,000
Other notes payable		800,000		1,000,000
Income taxes payable		5,479,240		1,624,069
Accounts payable and accrued expenses		9,588,661		18,271,240
Total liabilities		137,467,901		103,795,309
Shareholders’ equity:
Common stock, no par value		—		—
Authorized 95,000,000 shares; issued and outstanding 18,270,954 and 18,948,907 shares at September 30, 2005 and March 31, 2005, respectively
Additional paid-in capital		—		11,964,056
Retained earnings		185,497,415		177,747,137
Accumulated other comprehensive loss, net of tax		(5,285	)	—
Total shareholders’ equity		185,492,130		189,711,193
	$	322,960,031		293,506,502

See accompanying notes to consolidated financial statements.

3

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three months ended September 30,			Six months ended September 30,
	2005		2004	2005	2004
Revenues:
Interest and fee income	$	48,743,672	43,478,424	93,342,567	84,078,823
Insurance and other income		8,000,559	6,275,537	15,169,323	13,153,446
Total revenues		56,744,231	49,753,961	108,511,890	97,232,269
Expenses:
Provision for loan losses		13,131,219	11,281,929	22,671,322	19,909,337
General and administrative expenses:
Personnel		19,633,345	17,477,784	39,215,193	35,184,031
Occupancy and equipment		3,579,978	3,112,277	6,764,435	6,026,700
Data processing		511,997	399,201	1,012,613	867,182
Advertising		1,640,855	1,369,504	3,298,377	2,949,790
Amortization of intangible assets		729,947	633,202	1,415,912	1,264,515
Other		4,034,313	3,539,102	7,664,380	6,657,892
		30,130,435	26,531,070	59,370,910	52,950,110
Interest expense		1,621,539	1,067,112	2,928,131	2,056,321
Total expenses		44,883,193	38,880,111	84,970,363	74,915,768
Income before income taxes		11,861,038	10,873,850	23,541,527	22,316,501
Income taxes		4,432,000	3,968,000	8,800,000	8,145,000
Net income	$	7,429,038	6,905,850	14,741,527	14,171,501
Net income per common share:
Basic	$	.40	.37	.79	.76
Diluted	$	.39	.36	.76	.73
Weighted average common shares outstanding:
Basic		18,527,955	18,593,156	18,670,019	18,631,457
Diluted		19,147,348	19,429,018	19,312,224	19,459,166

See accompanying notes to consolidated financial statements.

4

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(Unaudited)

	Additional Paid-in Capital			Retained Earnings		Accumulated Other Comprehensive Loss		Total
Balances at March 31, 2005	$	11,964,056		177,747,137		—		189,711,193
Proceeds from exercise of stock options (122,447 shares), including tax benefit of $789,482		1,836,169		—		—		1,836,169
Common stock repurchases (800,400 shares)		(13,800,225	)	(6,991,249	)	—		(20,791,474	)
Other comprehensive loss, net of tax		—		—		(5,285	)	(5,285	)
Net income		—		14,741,527		—		14,741,527
Balances at September 30, 2005	$	—		185,497,415		(5,285	)	185,492,130

See accompanying notes to consolidated financial statements.

5

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Six months ended September 30,
	2005			2004
Cash flows from operating activities:
Net income	$	14,741,527		14,171,501
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		22,671,322		19,909,337
Amortization of intangible assets		1,415,912		1,264,515
Amortization of loan costs and discounts		25,000		31,079
Depreciation		1,095,334		962,194
Change in accounts:
Other assets, net		237,655		(1,215,690	)
Income taxes payable		4,644,653		2,089,178
Accounts payable and accrued expenses		(8,682,579	)	3,631,723
Net cash provided by operating activities		36,148,824		40,843,837
Cash flows from investing activities:
Increase in loans, net		(48,220,410	)	(30,303,223	)
Net assets acquired from office acquisitions, primarily loans		(2,325,778	)	(15,356,107	)
Purchase of premises and equipment		(1,987,586	)	(1,149,991	)
Purchases of intangible assets		(1,174,216	)	(3,234,782	)
Net cash used in investing activities		(53,707,990	)	(50,044,103	)
Cash flows from financing activities:
Proceeds of senior notes payable, net		38,700,000		17,950,000
Repayment of senior subordinated notes		—		(2,000,000	)
Repayment of other notes payable		(200,000	)	(682,000	)
Proceeds from exercise of stock options		1,046,687		2,247,043
Common stock repurchases		(20,791,474	)	(7,310,479	)
Net cash provided by financing activities		18,755,213		10,204,564
Increase in cash		1,196,047		1,004,298
Cash, beginning of period		3,046,677		4,314,107
Cash, end of period	$	4,242,724		5,318,405
Supplemental disclosure of cash flow information:
Cash paid for interest expense	$	2,810,797		2,031,385
Cash paid for income taxes		4,155,347		10,234,178
Supplemental schedule of noncash financing activities:
Tax benefits from exercise of stock options		789,482		1,404,693

See accompanying notes to consolidated financial statements.

6

WORLD ACCEPTANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2005

(Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The consolidated financial statements of the Company at September 30, 2005, and for the three and six month periods then ended were prepared in accordance with the instructions for Form 10-Q and are unaudited; however, in the opinion of management, all adjustments (consisting only of items of a normal recurring nature) necessary for a fair presentation of the financial position at September 30, 2005, and the results of operations and cash flows for the three and six months periods then ended, have been included. The results for the period ended September 30, 2005 are not necessarily indicative of the results that may be expected for the full year or any other interim period.

Certain reclassification entries have been made for fiscal 2005 to conform with fiscal 2006 presentation. These reclassifications had no impact on shareholders’ equity or net income.

The preparation of financial statements in conformity with U. S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

These consolidated financial statements do not include all disclosures required by U. S. generally accepted accounting principles and should be read in conjunction with the Company’s audited financial statements and related notes for the year ended March 31, 2005, included in the Company’s 2005 Annual Report to Shareholders.

The financial statements of the Company’s foreign subsidiary in Mexico are prepared using the local currency as the functional currency. Assets and liabilities of this subsidiary are translated into US dollars at the current exchange rate and income and expense items are translated at an average exchange rate for the period. The resulting translation gains and losses are recognized as a component of equity in “Accumulated Other Comprehensive Income (Loss)”.

NOTE 2 - ACCUMULATED OTHER COMPREHENSIVE LOSS

The Company applies the provision of Financial Accounting Standards Board’s (FASB) Statement of Financial Accounting Standards (SFAS) No. 130 “Reporting Comprehensive Income.” The following summarizes other comprehensive loss, net of tax:

	Three months ended September 30,				Six months ended September 30,
	2005			2004	2005		2004
Unrealized loss from foreign exchange translation adjustment	$	(5,285	)	—	(5,285	)	—
Balance at end of period	$	(5,285	)	—	(5,285	)	—

NOTE 3 - ALLOWANCE FOR LOAN LOSSES

The following is a summary of the changes in the allowance for loan losses for the periods indicated (unaudited):

	Three months ended September 30,					Six months ended September 30,
	2005			2004		2005		2004
Balance at beginning of period	$	20,531,043		18,644,931		20,672,740		17,260,750
Provision for loan losses		13,131,219		11,281,929		22,671,322		19,909,337
Loan losses		(12,550,416	)	(10,832,334	)	(23,106,962	)	(19,518,114	)
Recoveries		1,025,488		849,806		2,089,671		1,852,345
Allowance on acquired loans, net of specific charge-offs		86,087		477,267		(103,350	)	917,281
Balance at end of period	$	22,223,421		20,421,599		22,223,421		20,421,599

7

For the three months ended September 30, 2005 and 2004, the Company recorded gross adjustments of approximately $86,000 and $482,000, respectively, to the allowance for loan losses in connection with its acquisitions in accordance with U.S. generally accepted accounting principles. These adjustments were $123,000 and $922,000 for the six months ended September 30, 2005 and 2004, respectively.

The Company records acquired loans at fair value based on current interest rates, less allowances for uncollectibility and collection costs. The Company normally records all acquired loans on its books; however, the acquired loan portfolios generally include some loans that the Company deems uncollectible but which do not have an allowance assigned to them. An allowance for loan losses is then estimated based on a review of the loan portfolio, considering delinquency levels, charge-offs, loan mix and other current economic factors. The Company then records the acquired loans at their gross value and records the related allowance for loan losses as an adjustment to their allowance for loan losses. This is reflected as purchase accounting acquisitions. Subsequent charge-offs related to acquired loans are reflected in the purchase accounting acquisition adjustment in the year of acquisition.

NOTE 4 - AVERAGE SHARE INFORMATION

The following is a summary of the basic and diluted average common shares outstanding:

	Three months ended September 30,		Six months ended September 30,
	2005	2004	2005	2004
Basic:
Weighted average common shares outstanding (denominator)	18,527,955	18,593,156	18,670,019	18,631,457
Diluted:
Weighted average common shares outstanding	18,527,955	18,593,156	18,670,019	18,631,457
Dilutive potential common shares	619,393	835,862	642,205	827,709
Weighted average diluted shares outstanding (denominator)	19,147,348	19,429,018	19,312,224	19,459,166

The following options were outstanding at the period end presented but were excluded from the calculation of diluted earnings per share because the exercise price was greater than the average market price of the common shares:

For the six months ended	Number of Shares	Exercise Price
September 30, 2005	—		—
September 30, 2004	50,000	$	22.25

8

NOTE 5 - STOCK-BASED COMPENSATION

SFAS No. 123, “Accounting for Stock-Based Compensation,” issued in October 1995, allows a company to either adopt the fair value method of valuation or continue using the intrinsic valuation method presented under Accounting Principles Board (APB) Opinion 25 to account for stock-based compensation. The fair value method recommended in SFAS No. 123 requires a company to recognize compensation expense based on the fair value of the option on the grant date. The intrinsic value method measures compensation expense as the difference between the quoted market price of the stock and the exercise price of the option on the date of grant. The Company has elected to continue using APB Opinion 25. Accordingly, no compensation expense has been recorded. Had compensation cost been recognized for the stock option plans applying the fair-value-based method as prescribed by SFAS 123, the Company’s net income and earnings per share would have been reduced to the pro forma amounts indicated below:

	Three months ended September 30,			Six months ended September 30,
(Dollars in thousands, except per share amounts)	2005		2004	2005	2004
Net income
Net income, as reported	$	7,429	6,906	14,742	14,172
Deduct:
Total stock-based employee compensation expense determined under fair value based method for all option awards, net of related income tax effect		241	202	619	539
Pro forma net income	$	7,188	6,704	14,123	13,633
Basic earnings per share
As reported	$	0.40	0.37	0.79	0.76
Pro forma	$	0.39	0.36	0.76	0.73
Diluted earnings per share
As reported	$	0.39	0.36	0.76	0.73
Pro forma	$	0.38	0.35	0.73	0.70

NOTE 6 - ACQUISITIONS

The following table sets forth the acquisition activity of the Company for the six months ended September 30, 2005 and 2004:

	2005		2004
Number of offices purchased		14		46
Merged into existing offices		13		18
Purchase Price	$	3,499,994	$	18,590,889
Tangible assets:
Net loans		2,285,778		15,183,425
Furniture, fixtures & equipment		40,000		172,682
Excess of purchase prices over carrying value of net intangible assets	$	2,325,778	$	15,356,107
Customer lists		1,063,316		1,611,513
Non-compete agreements		60,000		195,000
Goodwill		50,900		1,428,269
Total intangible assets	$	1,174,216	$	3,234,782

The Company evaluates each acquisition to determine if the acquired enterprise meets the definition of a business. Those that meet the definition of a business are accounted for under SFAS No. 141 and those that do not meet the definition of a business are accounted for as asset purchases. The results of all acquisitions have been included in the Company’s consolidated financial statements since the respective acquisition dates. The pro forma impact of these purchases as though they had been acquired at the beginning of the periods presented would not have had a material effect on the results of operations as reported.

9

NOTE 7 - RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

Accounting for Certain Loans or Debt Securities Acquired in a Transfer

Effective April 1, 2005, the Company adopted Statement of Position No. 03-3 (SOP 03-3), “Accounting for Certain Loans or Debt Securities Acquired in a Transfer,” which prohibits carryover or creation of valuation allowances in the initial accounting of all loans acquired in a transfer that are within the scope of this SOP. The prohibition of the valuation allowance carryover applies to the purchase of loans (including loans acquired in a business combination) with evidence of determination of credit quality since origination, for which it is probable, at acquisition, that the investor will be unable to collect all contractually required payments. The initial adoption of this standard did not have a material impact on the financial condition or results of operations of the Company.

10

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

PART I. FINANCIAL INFORMATION

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations

The following table sets forth certain information derived from the Company’s consolidated statements of operations and balance sheets, as well as operating data and ratios, for the periods indicated (unaudited):

	Three months ended September 30,					Six months ended September 30,
	2005			2004		2005		2004
	(Dollars in thousands)
Average gross loans receivable (1)	$	381,910		340,829		370,965		331,614
Average net loans receivable (2)		287,133		258,705		279,824		252,119
Expenses as a % of total revenue:
Provision for loan losses		23.1	%	22.7	%	20.9	%	20.5	%
General and administrative		53.1	%	53.3	%	54.7	%	54.5	%
Total interest expense		2.9	%	2.1	%	2.7	%	2.1	%
Operating margin (3)		23.8	%	24.0	%	24.4	%	25.1	%
Return on average assets (annualized)		9.5	%	9.7	%	9.6	%	10.2	%
Offices opened or acquired, net		28		31		32		49
Total offices (at period end)		611		575		611		575

(1) Average gross loans receivable have been determined by averaging month-end gross loans receivable over the indicated period.

(2) Average net loans receivable have been determined by averaging month-end gross loans receivable less unearned interest and deferred fees over the indicated period.

(3) Operating margin is computed as total revenues less provision for loan losses and general and administrative expenses, as a percentage of total revenue.

Comparison of Three Months Ended September 30, 2005, Versus

Three Months Ended September 30, 2004

For the quarter ended September 30, 2005, net income amounted to $7.4 million. This represents a $.5 million, or 7.6%, increase when comparing the two three-month periods. Operating income (revenues less the provision for loan losses and general and administrative expenses) increased by $1.5 million, or 12.9%, over the two periods. This increase was partially offset by an increase in interest expense and by an increase in income taxes.

Interest and fee income for the quarter ended September 30, 2005, increased by $5.3 million, or 12.1%, over the same period of the prior year. This increase resulted from a $28.4 million increase, or 11.0%, in average net loans receivable over the two corresponding periods. The percentage increase in interest and fee income was slightly more than the increase in average net loans receivable due to a small change in mix in the loan portfolio. During the twelve months ending on September 30, 2005, small loans (those less than $1,000 in original balance) grew by 15.5% and the larger loans grew by 7.9%. Smaller loans generally carry higher interest rates and fees (and will have higher losses) than the larger loans. At September 30, 2005, the portfolios mix was as follows: Small – 70.9%; Large – 27.2%; and Sales Finance – 1.9%. This compares to a mix at September 30, 2004 of: Small – 69.5%; Large – 28.5%; and Sales Finance – 2.0%. The shift in the loan mix was due primarily to the growth in overall loans in the state of Texas, resulted from the enactment of a new law in Texas effective September 1, 2005, that increased the maximum dollar amount of a loan that the Company may make in that state under the Company’s loan license.

11

WORLD ACCEPTANCE CORPORATION

MANAGEMENTS’ DISCUSSION AND ANALYSIS, CONTINUED

Comparison of Three Months Ended September 30, 2005, Versus

Three Months Ended September 30, 2004, continued

Insurance commissions and other income increased by $1.7 million, or 27.5%, when comparing the two quarterly periods. Insurance commissions increased by $906,000, or 23.1%, due to the increased loan volume in those states where credit insurance may be sold. Other income increased by $819,000, or 34.7%. Other sources of revenues, including returned check charges, sale of motor club memberships, and the gross profit from the sale of electronics and appliances under our World Class Buying Club, were higher during the most recent quarter due to the overall increase in the customer base. Additionally, the increase in other income resulted from $393,000 in proceeds from a company owned life insurance policy on a former officer, who passed away during the prior quarter.

Total revenues rose to $56.7 million during the quarter ended September 30, 2005, a 14.0% increase over the $49.8 million for the corresponding quarter of the previous year. Revenues from the 516 offices open throughout both quarters increased by approximately 7.2%, primarily due to increased balances of loans receivable in those offices. At September 30, 2005, the Company had 611 offices in operation, an increase of 36 offices from September 30, 2004 and an increase of 32 offices since the beginning of the fiscal year.

The provisions for loan losses during the quarter ended September 30, 2005, increased by $1.8 million, or 16.4% from the same quarter last year. This increase resulted from a combination of increases in both the general allowance for loan losses due to loan growth and the amount of loans charged off. Net charge-offs for the current quarter amounted to $11.5 million, a 15.5% increase over the $10.0 million charged off during the same quarter of fiscal 2005. As a percentage of average net loans receivable, net charge-offs increased from 15.4% on an annualized basis for three months ended September 30, 2004, to 16.1% annualized for the current quarter. Management does not currently believe that loan losses will rise significantly above the most recent quarterly levels; however, the Company can give no assurance that loan losses will not continue to increase, and such further increases would negatively affect the Company’s financial performance.

General and administrative expenses for the quarter ended September 30, 2005, increased by $3.6 million, or 13.6% over the same quarter of fiscal 2005. This increase was due primarily to the addition of 36 net new offices between September 30, 2004 and the end of the current quarter. Overall, general and administrative expenses as a percent of total revenues decreased from 53.3% during the quarter ended September 30, 2004, to 53.1% during the most recent quarter.

Interest expense increased by $554,000, or 52.0%, when comparing the two quarterly periods, as a result of the continuing rise in interest rates.

The Company’s effective income tax rate increased from 36.5% during the prior fiscal year to 37.4% during the current fiscal year due to an anticipated increase in state income taxes.

Comparison of Six Months Ended September 30, 2005,

Versus Six Months Ended September 30, 2004

For the six-month period ended September 30, 2005, net income amounted to $14.7 million. This represents a $570,000, or 4.0%, increase when comparing the two six-month periods. Operating income increased by $2.1 million, or 8.6%, over the two periods. This increase was partially offset by an increase in interest expense and by an increase in income taxes.

Total revenues amounted to $108.5 million during the current six-month period, an increase of $11.3 million, or 11.6%, over the prior-year period. This increase resulted from increases in interest and fee income of 11.0%, insurance commissions of 16.6% and other income of 13.3%. The increase in interest and fee income resulted from the increase in average net loans receivable of 11.0% when comparing the two six-month periods. Revenues from the 516 offices open throughout both six-month periods increased approximately 5.1%.

12

The provision for loan losses increased by $2.8 million, or 13.9%, during the current six-month period when compared to the same period of fiscal 2005. This increase resulted primarily from an increase in loan losses over these two periods. Net charge-offs increased to $21.0 million during the six-months ended September 30, 2005, a $3.4 million, or 19.0%, increase over the $17.7 million charged-off during the September 30, 2004 period. As a percentage of average net loans receivable, annualized net charge-offs increased from 14.0% during the prior period to 15.0% during the most recent six month period.

General and administrative expenses increased by $6.4 million, or 12.1%, over the prior six-month period. This increase resulted from the 36 net new offices added during the 12 month period ending September 30, 2005. As a percent of total revenues, general and administrative expenses increased slightly from 54.5% during the six month of fiscal 2004 to 54.7% during the most recent period. Additionally, excluding the expenses associated with ParaData, overall general and administrative expenses, when divided by the average open offices, increased by 4.2% when comparing the two-six month periods.

Interest expense increased by $872,000 when comparing the two six-month periods, an increase of 42.4%. This resulted from the rise in interest rates during the current year. The overall cost of funds rose from 3.8% for the six months of the prior fiscal year to 5.7% for the most recent six-month period.

Critical Accounting Policies

The Company’s accounting and reporting policies are in accordance with U.S. generally accepted accounting principles and conform to general practices within the finance company industry. Certain critical accounting policies involve significant judgment by the Company’s management, including the use of estimates and assumptions which affect the reported amounts of assets, liabilities, revenues, and expenses. As a result, changes in these estimates and assumptions could significantly affect the Company’s financial position and results of operations. The Company considers its policies regarding the allowance for loan losses to be its most critical accounting policy due to the significant degree of management judgment. The Company has developed policies and procedures for assessing the adequacy of the allowance for loan losses which takes into consideration various assumptions and estimates with respect to the loan portfolio. The Company’s assumptions and estimates may be affected in the future by changes in economic conditions, among other factors. There have been no material changes to the Company’s critical accounting policies during the quarter ended September 30, 2005.

Liquidity and Capital Resources

The Company has financed its operations, acquisitions and office expansion through a combination of cash flow from operations and borrowings from its institutional lenders. The Company’s primary ongoing cash requirements relate to the funding of new offices and acquisitions, the overall growth of loans outstanding, the repayment of indebtedness and the repurchase of its common stock. As the Company’s gross loans receivable increased from $226.3 million at March 31, 2002 to $351.5 million at March 31, 2005, net cash provided by operating activities for fiscal years 2003, 2004 and 2005 was $55.1 million, $70.4 million and $88.1 million, respectively.

During the first six months of fiscal 2006, the Company repurchased 800,400 shares for an aggregate purchase price of $20,791,474. See the table entitled “Issuer Purchases of Equity Securities” in Part II, Item 2 below for further information regarding the Company’s recent repurchase activity and remaining repurchase authorization. The Company believes stock repurchases to be a viable component of the Company’s long-term financial strategy and an excellent use of excess cash when the opportunity arises. In addition, the Company plans to open or acquire at least 25 new offices in each of the next two fiscal years. Expenditures by the Company to open and furnish new offices generally averaged approximately $25,000 per office during fiscal 2005. New offices have also required from $100,000 to $400,000 to fund outstanding loans receivable originated during their first 12 months of operation.

The Company acquired one office and a number of loan portfolios from competitors in five states in seven separate transactions during the first six months of fiscal 2006. Gross loans receivable purchased in these transactions were approximately $3.0 million in the aggregate at the dates of purchase. The Company believes that attractive opportunities to acquire new offices or receivables from its competitors or to acquire offices in communities not currently served by the Company will continue to become available as conditions in local economies and the financial circumstances of owners change.

13

WORLD ACCEPTANCE CORPORATION

MANAGEMENTS’ DISCUSSION AND ANALYSIS, CONTINUED

The Company has a $167.0 million base credit facility with a syndicate of banks. In addition to the base revolving credit commitment, there is a $15 million seasonal revolving credit commitment available November 15 of each year through March 31 of the immediately succeeding year to cover the increase in loan demand during this period. The credit facility will expire on September 30, 2007. Funds borrowed under the revolving credit facility bear interest, at the Company’s option, at either the agent bank’s prime rate per annum or the LIBOR rate plus 1.90% per annum. At September 30, 2005, the interest rate on borrowings under the revolving credit facility was 5.71%. The Company pays a commitment fee equal to 0.375% of the daily unused portion of the revolving credit facility. Amounts outstanding under the revolving credit facility may not exceed specified percentages of eligible loans receivable. On September 30, 2005, $121.6 million was outstanding under this facility, and there was $45.4 million of unused borrowing availability under the borrowing base limitations.

The Company’s credit agreements contain a number of financial covenants, including minimum net worth and fixed charge coverage requirements. The credit agreements also contain certain other covenants, including covenants that impose limitations on the Company with respect to (i) declaring or paying dividends or making distributions on or acquiring common or preferred stock or warrants or options; (ii) redeeming or purchasing or prepaying principal or interest on subordinated debt; (iii) incurring additional indebtedness; and (iv) entering into a merger, consolidation or sale of substantial assets or subsidiaries. The Company believes that it was in compliance with these agreements as of September 30, 2005, and does not believe that these agreements will materially limit its business and expansion strategy.

The Company believes that cash flow from operations and borrowings under its revolving credit facility will be adequate to fund, for the next 12 months and for the foreseeable future beyond that, the expected cost of opening or acquiring new offices, including funding initial operating losses of new offices and funding loans receivable originated by those offices and the Company’s other offices and the scheduled repayment of the other notes payable. Management is not currently aware of any trends, demands, commitments, events or uncertainties that it believes will result in, or are reasonably likely to result in, the Company’s liquidity increasing or decreasing in any material way. From time to time, the Company has needed and obtained, and expects that it will continue to need on a periodic basis, an increase in the borrowing limits under its revolving credit facility. The Company has successfully obtained such increases in the past and anticipates that it will be able to do so in the future as the need arises; however, there can be no assurance that this additional funding will be available (or available on reasonable terms) if and when needed.

Inflation

The Company does not believe that inflation has a material adverse effect on its financial condition or results of operations. The primary impact of inflation on the operations of the Company is reflected in increased operating costs. While increases in operating costs would adversely affect the Company’s operations, the consumer lending laws in three of the eleven states in which the Company currently operates allow indexing of maximum loan amounts to the Consumer Price Index. These provisions will allow the Company to make larger loans at existing interest rates, which could partially offset the effect of inflationary increases in operating costs.

Quarterly Information and Seasonality

The Company’s loan volume and corresponding loans receivable follow seasonal trends. The Company’s highest loan demand occurs each year from October through December, its third fiscal quarter. Loan demand is generally the lowest and loan repayment is highest from January to March, its fourth fiscal quarter. Loan volume and average balances remain relatively level during the remainder of the year. This seasonal trend causes fluctuations in the Company’s cash needs and quarterly operating performance through corresponding fluctuations in interest and fee income and insurance commissions earned, since unearned interest and insurance income are accreted to income on a collection method. Consequently, operating results for the Company’s third fiscal quarter are significantly lower than in other quarters and operating results for its fourth fiscal quarter are generally higher than in other quarters.

14

WORLD ACCEPTANCE CORPORATION

MANAGEMENTS’ DISCUSSION AND ANALYSIS, CONTINUED

Recently Adopted Accounting Pronouncements

Accounting for Certain Loans or Debt Securities Acquired in a Transfer

Effective April 1, 2005, the Company adopted Statement of Position No. 03-3 (SOP 03-3), “Accounting for Certain Loans or Debt Securities Acquired in a Transfer,” which prohibits carryover or creation of valuation allowances in the initial accounting of all loans acquired in a transfer that are within the scope of this SOP. The prohibition of the valuation allowance carryover applies to the purchase of loans (including loans acquired in a business combination) with evidence of determination of credit quality since origination, for which it is probable, at acquisition, that the investor will be unable to collect all contractually required payments. The initial adoption of this standard did not have a material impact on the financial condition or results of operations of the Company.

Recently Issued Accounting Pronouncements

Accounting for Stock Based Compensation

In December 2004, the FASB issued Statement of Financial Accounting Standards (SFAS) No. 123 (Revised) (SFAS 123-R), “Share-Based Payment.” This standard requires expensing of stock options and other share-based payments and supersedes SFAS No. 123, which had allowed companies to choose between expensing stock options or showing pro forma disclosure only. On April 14, 2005, the SEC announced the adoption of a rule that delays the effective date of SFAS 123-R. This standard will be effective as of the beginning of the Company’s 2007 fiscal year and will apply to previously issued and unvested awards, as well as all awards granted, modified, cancelled or repurchased after the effective date. The Company is currently evaluating the expected impact that the adoption of SFAS 123-R will have on its financial condition or results of operations. Pro forma information regarding net income and earnings per share as if we had accounted for our employee stock options granted under the fair value method of SFAS 123 is presented in Note 5 to our Condensed Consolidated Financial Statements.

Accounting Changes and Error Corrections

In May 2005, the FASB issued Statement of Financial Accounting Standards NO. 154 (“SFAS 154”), Accounting Changes and Error Corrections – a replacement of APB Opinion No. 20 and FASB Statement No. 3,” which eliminates the requirement to reflect changes in accounting principles as cumulative adjustments to net income in the period of the change and requires retrospective application to prior periods’ financial statements of voluntary changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. If it is impracticable to determine the cumulative effect of the change to all prior periods, SFAS 154 requires that the new accounting principle be adopted prospectively. For new accounting pronouncements, the transition guidance in the pronouncement should be followed. Retrospective application refers to the application of a different accounting principle to previously issued financial statements as if that principle had always been used.

SFAS 154 did not change the guidance for reporting corrections of errors, changes in estimates or for justification of a change in accounting principle on the basis of preferability. SFAS 154 is effective for accounting changes made in fiscal years beginning after December 15, 2005.

Forward-Looking Information

This report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” may contain various “forward-looking statements,” within the meaning of Section 21E of the Securities Exchange Act of 1934, that are based on management’s belief and assumptions, as well as information currently available to management. When used in this document, the words “anticipate,” “estimate,” “plan,” “expect,” “believe,” “may,” “will,” and “should” any variation of the foregoing and similar expressions identify

15

WORLD ACCEPTANCE CORPORATION

MANAGEMENTS’ DISCUSSION AND ANALYSIS, CONTINUED

forward-looking statements. Although the Company believes that the expectations reflected in any such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Any such statements are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, the Company’s actual financial results, performance or financial condition may vary materially from those anticipated, estimated or expected. Among the key factors that could cause the Company’s actual financial results, performance or condition to differ from the expectations expressed or implied in such forward-looking statements are the following: changes in interest rates; risks inherent in making loans, including repayment risks and value of collateral; recently-enacted, proposed or future legislation; the timing and amount of revenues that may be recognized by the Company; changes in current revenue and expense trends (including trends affecting charge-offs); changes in the Company’s markets and general changes in the economy (particularly in the markets served by the Company); and other matters discussed in this Report and, from time to time, in the Company’s other reports on Forms 10-K, 10-Q and 8-K filed with, or furnished to, the Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statements it makes.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company’s financial instruments consist of the following: cash, loans receivable, and senior notes payable. Fair market approximates carrying value for all of these instruments. Loans receivable are originated at prevailing market rates and have an average life of approximately four months. Given the short-term nature of these loans, they are continually repriced at current market rates. The revolving credit facility and the other $0.8 million note payable have variable rates based on a margin over LIBOR and reprice with any changes in LIBOR. The Company’s outstanding debt under its floating rate notes was $121.6 million at September 30, 2005. Interest on borrowings under the revolving credit facility is based, at the Company’s option, on the prime rate or LIBOR plus 1.90% and on the other note payable, LIBOR plus 2.00%. Based on the outstanding balance at September 30, 2005, a change of 1% in the interest rate would cause a change in interest expense of approximately $1.2 million on an annual basis.

Item 4. Controls and Procedures

An evaluation was carried out under the supervision and with the participation of the Company’s management, including its Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the Company’s disclosure controls and procedures as of September 30, 2005. Based on that evaluation, the Company’s management, including the CEO and CFO, has concluded that the Company’s disclosure controls and procedures are effective. During the second quarter of fiscal 2006, there was no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time the Company is involved in routine litigation relating to claims arising out of its operations in the normal course of business. The Company believes that it is not presently a party to any such pending legal proceedings that would have a material adverse effect on its financial condition.

16

WORLD ACCEPTANCE CORPORATION

MANAGEMENTS’ DISCUSSION AND ANALYSIS, CONTINUED

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The Company’s credit agreements contain certain restrictions on the payment of cash dividends on its capital stock. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources.”

Issuer Purchases of Equity Securities

	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Approximate Dollar Value of Shares That May Yet be Purchased Under the Plans or Programs
July 1 through July 30, 2005	112,500	$	26.52	112,500	$	16,030,805	*
August 1 through August 31, 2005	352,500	$	25.88	352,500	$	6,908,784	*
September 1 through September 30, 2005	69,400	$	25.95	69,400	$	5,107,915	*
Total for the Quarter	534,400	$	26.02	534,400

* At the regularly scheduled Board Meeting on May 12, 2005, the Board of Directors authorized $20 million of repurchases under the Company’s stock repurchase program. This authorization, which was disclosed in a press release dated May 13, 2005, is not subject to specific targets or any expiration date, but may be discontinued at any time.

Item 4. Submission of Matters to a Vote of Security Holders

(a) The 2005 Annual Meeting of Shareholders was held on August 3, 2005.

(b) Pursuant to Instruction 3 to Item 4, this paragraph need not be answered.

(c) At the 2005 Annual Meeting of Shareholders, the following three matters were voted upon and passed. The tabulation of votes was:

(1) The election of seven Directors to serve until the 2006 Annual Meeting of Shareholders:

	VOTES IN FAVOR	VOTES WITHHELD
Ken R. Bramlett, Jr.	15,937,684	1,966,997
James R. Gilreath	10,292,071	7,612,610
William S. Hummers III	15,937,684	1,966,997
Douglas R. Jones	15,518,469	2,386,212
A. Alexander McLean III	15,179,023	2,725,658
Charles D. Walters	15,053,493	2,851,188
Charles D. Way	15,937,684	1,966,997

17

(2) The approval of the 2005 Stock Option Plan:

VOTES IN FAVOR	VOTES AGAINST	ABSTENTIONS
14,677,744	1,767,102	8,464

(3) The ratification of the selection of KPMG LLP as Independent Auditors:

VOTES IN FAVOR	VOTES AGAINST	ABSTENTIONS*
17,841,013	60,984	2,684

* There were no broker non-votes on this routine item.

18

WORLD ACCEPTANCE CORPORATION

AND SUBSIDIARIES

PART II. OTHER INFORMATION, CONTINUED

Item 6. Exhibits

Exhibit Number	Description	Previous Exhibit Number	Company Registration No. or Report
3.1	Second Amended and Restated Articles of Incorporation of the Company, as amended	3.1	333-107426
3.2	Amended Bylaws of the Company	3.4	33-42879
4.1	Specimen Share Certificate	4.1	33-42879
4.2	Articles 3, 4 and 5 of the Form of Company’s Second Amended and Restated Articles of Incorporation (as amended)	3.1	333-107426
4.3	Article II, Section 9 of the Company’s Second Amended and Restated Bylaws	3.2	33-42879
4.4	Amended and Restated Credit Agreement dated July 20, 2005	4.4	6-30-05 10-Q
4.5	Subsidiary Security Agreement dated as of June 30, 1997, as amended through July 20, 2005	*
4.6	Company Security Agreement dated as of June 30, 1997, as amended through July 20, 2005	*
10.1+	Amended and Restated Employment Agreement of Charles D. Walters, effective as of June 1, 2003	10.1	6-30-03 10-Q
10.2+	Amended Agreement of Amended and Restated Employment Agreement of Charles D. Walters, effective as of January 28, 2004	10.2	6-30-04 10-Q
10.23	Employment Agreement of A. Alexander McLean, III, Effective April 1, 1994	10.2	1994 10-K
10.4+	First Amendment to Employment Agreement of A. Alexander McLean, III, effective as of June 1, 2003	10.3	6-30-03 10-Q
10.5+	Amended and Restated Employment Agreement of Douglas R. Jones, effective as of June 1, 2003	10.4	6-30-03 10-Q
10.6+	Securityholders’ Agreement, dated as of September 19, 1991, between the Company and certain of its securityholders	10.5	33-42879
10.7+	World Acceptance Corporation Supplemental Income Plan	10.7	2000 10-K
10.8+	Board of Directors Deferred Compensation Plan	10.6	2000 10-K
10.9+	1992 Stock Option Plan of the Company	4	33-52166
10.10+	1994 Stock Option Plan of the Company, as amended	10.6	1995 10-K
10.11+	2002 Stock Option Plan of the Company	Appendix A	Definitive Proxy Statement on Schedule 14A for the 2002 Annual Meeting

19

Exhibit Number	Description	Previous Exhibit Number	Company Registration No. or Report
10.11+	2005 Stock Option Plan of the Company	Appendix B	Definitive Proxy Statement on Schedule 14A for the 2005 Annual Meeting
10.13+	The Company’s Executive Incentive Plan	10.6	1994 10-K
10.14+	World Acceptance Corporation Retirement Savings Plan	4.1	333-14399
10.15+	Executive Deferral Plan	10.12	2001 10-K
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer	*
31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer	*
32.1	Section 1350 Certification of Chief Executive Officer	*
32.2	Section 1350 Certification of Chief Financial Officer	*

+ Management Contract or other compensatory plan required to be filed under Item 14(c) of this report and Item 601 of Regulation 5-K of the Securities and Exchange Commission.

* Filed or furnished herewith.

20

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

WORLD ACCEPTANCE CORPORATION
By:	/s/    A. ALEXANDER MCLEAN, III
	A. Alexander McLean, III, Executive Vice President and Chief Financial Officer (principal financial officer and principal accounting officer)
Date: November 9, 2005
By:	/s/    DOUGLAS R. JONES
	Douglas R. Jones, President and Chief Executive Officer (principal executive officer)
Date: November 9, 2005

21

EX-4.5

Exhibit 4.5

CONFORMED COPY

AMENDED AND RESTATED SECURITY AGREEMENT, PLEDGE

AND

INDENTURE OF TRUST

DATED AS OF JUNE 30, 1997

AMONG

WORLD ACCEPTANCE CORPORATION OF ALABAMA

WORLD ACCEPTANCE CORPORATION OF MISSOURI

WORLD FINANCE CORPORATION OF GEORGIA

WORLD FINANCE CORPORATION OF LOUISIANA

WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC.

WORLD FINANCE CORPORATION OF SOUTH CAROLINA

WORLD FINANCE CORPORATION OF TENNESSEE

WORLD FINANCE CORPORATION OF TEXAS

WFC LIMITED PARTNERSHIP

WFC OF SOUTH CAROLINA, INC.

WORLD FINANCE CORPORATION OF ILLINOIS

AND

WORLD FINANCE CORPORATION OF NEW MEXICO

AND

HARRIS TRUST AND SAVINGS BANK,

AS SECURITY TRUSTEE

TABLE OF CONTENTS

SECTION	HEADING	PAGE
Parties
Recitals		1
SECTION 1. INTERPRETATION OF AGREEMENT; DEFINITIONS		4
Section 1.1.	Definitions	4
Section 1.2.	Accounting Principles	12
Section 1.3.	Directly or Indirectly	12
SECTION 2. GRANTING CLAUSES		12
Section 2.1.	Equipment	12
Section 2.2.	Receivables	12
Section 2.3.	Pledged Collateral	13
Section 2.4.	General Intangibles	13
Section 2.5.	Investment Property	13
Section 2.6.	Records and Cabinets	13
Section 2.7.	Partnership Interests	13
Section 2.8.	Additional Property	14
Section 2.9.	Other Proceeds and Products	14
SECTION 3. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANIES		14
Section 3.1.	Location of Collateral	14
Section 3.2.	Warranty of Title	15
Section 3.3.	No Alienation of Collateral	15
Section 3.4.	Removal of Collateral	15
Section 3.5.	Compliance with Leases	15
Section 3.6.	Protection of Collateral	15
Section 3.7.	Further Assurances	16
Section 3.8.	Maintenance of Lien; Recording; Opinions of Counsel	17
Section 3.9.	Consent to World Security Agreement, Etc.	17
Section 3.10.	Names under which Each Company Conducts its Business	18
SECTION 4. SPECIAL PROVISIONS RELATING TO RECEIVABLES		18
Section 4.1.	Representations and Warranties	18
Section 4.2.	Receivable Schedules	19
Section 4.3.	Collection of Receivables	20
Section 4.4.	Power of Attorney	21

-i-

SECTION 5. SPECIAL PROVISIONS RELATING TO PLEDGED COLLATERAL		21
Section 5.1.	Delivery of Pledged Collateral; Transfer to Security Trustee	21
Section 5.2.	Voting Power; Payments	22
Section 5.3.	Covenants of Each Company	23
SECTION 6. APPLICATION OF CERTAIN MONEYS		24
Section 6.1.	Application if no Default or Event of Default Exists	24
Section 6.2.	Application if a Default or an Event of Default Exists	24
SECTION 7. DEFAULTS AND REMEDIES		24
Section 7.1.	Events of Default	24
Section 7.2.	Security Trustee’s Rights	24
Section 7.3.	Waiver by Each Company	25
Section 7.4.	Effect of Sale	26
Section 7.5.	Application of Sale and Other Proceeds	26
Section 7.6.	Discontinuance of Remedies	28
Section 7.7.	Cumulative Remedies	28
SECTION 8. THE SECURITY TRUSTEE		28
Section 8.1.	Duties of Security Trustee	28
Section 8.2.	Security Trustee’s Liability	29
Section 8.3.	No Responsibility of Security Trustee for Recitals	30
Section 8.4.	Certain Limitations on Security Trustee’s Rights to Compensation and Indemnification	31
Section 8.5.	Status of Moneys Received	31
Section 8.6.	Resignation of Security Trustee	31
Section 8.7.	Removal of Security Trustee	31
Section 8.8.	Appointment of Successor Security Trustee	32
Section 8.9.	Succession of Successor Security Trustee	32
Section 8.10.	Eligibility of Security Trustee	33
Section 8.11.	Successor Security Trustee by Merger	33
Section 8.12.	Co-Trustees	33
Section 8.13.	Compensation and Reimbursement	33
SECTION 9. SUPPLEMENTS; WAIVERS		34
Section 9.1.	Supplemental Security Agreements Without Noteholder Consent	34
Section 9.2.	Waivers and Consents by Noteholders; Supplemental Security Agreements with Noteholders’ Consent	35
Section 9.3.	Notice of Supplements	36
Section 9.4.	Opinion of Counsel Conclusive as to Supplements	36
SECTION 10. MISCELLANEOUS		37

-ii-

Section 10.1.	Successors and Assigns	37
Section 10.2.	Severability	37
Section 10.3.	Communications	37
Section 10.4.	Release	38
Section 10.5.	Counterparts	39
Section 10.6.	Governing Law	39
Section 10.7.	Headings	39
Section 10.8.	Prior Liens	39
Section 10.9.	Rights of Holders of Senior Subordinated Notes	40
Signature Page		41

ATTACHMENTS TO SECURITY AGREEMENT AND INDENTURE OF TRUST:

Schedule I	—	Description of Pledged Collateral
Schedule II	—	Partnership Interests
Schedule III	—	Locations of Each Company’s Offices and Facilities
Schedule IV	—	List of Names Under Which Each Company Does Business
Exhibit A	—	Form of Security Agreement Supplement

-iii-

AMENDED AND RESTATED SECURITY AGREEMENT, PLEDGE

AND INDENTURE OF TRUST

Amended and Restated Security Agreement, Pledge and Indenture of Trust (this “Agreement”) dated as of June 30, 1997, among WORLD ACCEPTANCE CORPORATION OF ALABAMA, an Alabama corporation, WORLD ACCEPTANCE CORPORATION OF MISSOURI, a Missouri corporation, WORLD FINANCE CORPORATION OF GEORGIA, a Georgia corporation, WORLD FINANCE CORPORATION OF LOUISIANA, a Louisiana corporation, WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC., an Oklahoma corporation, WORLD FINANCE CORPORATION OF SOUTH CAROLINA, a South Carolina corporation, WORLD FINANCE CORPORATION OF TENNESSEE, a Tennessee corporation, WORLD FINANCE CORPORATION OF TEXAS, a Texas corporation, WFC LIMITED PARTNERSHIP, a Texas limited partnership, WFC OF SOUTH CAROLINA, INC., a South Carolina corporation, WORLD FINANCE CORPORATION OF ILLINOIS, an Illinois corporation, and WORLD FINANCE CORPORATION OF NEW MEXICO, a New Mexico corporation (collectively, the “Companies” and individually a “Company”), and HARRIS TRUST AND SAVINGS BANK, an Illinois banking corporation (the “Security Trustee”), as amended, modified, supplemented or waived from time to time and as supplemented from time to time by a security agreement supplement substantially in the form of Exhibit A hereto between a Restricted Subsidiary and the Security Trustee delivered pursuant to Section 3.9 of the World Security Agreement. This Agreement amends and restates the Original Subsidiary Security Agreements (as hereinafter defined) and the Additional Subsidiary Security Agreements (as hereinafter defined). The post office addresses of the Companies and the Security Trustee are set forth in §10.3.

RECITALS:

A. The capitalized terms used in this Agreement shall have the respective meanings specified in §1.1 unless otherwise herein defined or the context hereof shall otherwise require.

B. World Acceptance Corporation, a South Carolina corporation (“World”) and parent, directly or indirectly, of the Companies, has previously entered into separate Note Agreements each dated as of December 1, 1992, as amended (the “Original Senior Note Agreements”), with the institutional investors named in Schedule I to the Original Senior Note Agreements providing for the issuance and sale by World of its $20,000,000 principal amount 8.5% Senior Secured Notes due December 1, 1999 (the “Original Senior Secured Notes”).

C. World also entered into that certain Revolving Credit Agreement dated as of December 1, 1992, as amended (the “Original Revolving Credit Agreement”), with Harris Trust and Savings Bank, as agent and the other banks which are signatories thereto providing for borrowings in an original aggregate principal amount of $20,000,000 (the borrowings, whether or not evidenced by promissory notes, being hereinafter referred to as the “Original Revolving Credit Notes”). The Original Senior Secured Notes and the Original Revolving Credit Notes are hereinafter collectively referred to as the “Original Senior Notes.”

Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

D. World also entered into that certain Security Agreement, Pledge and Indenture of Trust dated as of December 1, 1992, as amended (the “Original World Security Agreement”), with Harris Trust and Savings Bank, an Illinois banking corporation, as security trustee (the “Security Trustee”) whereby World granted to the Security Trustee, inter alia, for the benefit of the holders of the Original Senior Notes, all of its right, title and interest in the Collateral (as defined therein) as security for the Original Senior Notes.

E. As a condition to the issuance of the Original Senior Notes, World Finance Corporation of South Carolina, World Finance Corporation of Georgia, World-TX, World-OK and World Finance Corporation of Louisiana entered into those separate Guaranty Agreements each dated as of December 1, 1992, as amended or amended and restated, as the case may be (the “Original Senior Guaranty Agreements”).

F. Pursuant to Section 3.29 of the Original World Security Agreement, (i) World Acceptance Corporation of Alabama entered into that certain Guaranty Agreement dated as of July 11, 1994, (ii) World-MO entered into that certain Guaranty Agreement dated as of April 2, 1993, (iii) World Finance Corporation of Tennessee entered into that certain Guaranty Agreement dated as of April 2, 1993, (iv) WFC-LP entered into that certain Guaranty Agreement dated as of July 1, 1995, (v) WFC-SC entered into that certain Guaranty Agreement dated as of September 1, 1995, (vi) World Finance Corporation of Illinois entered into that certain Guaranty Agreement dated as of March 14, 1996 and (vii) World Finance Corporation of New Mexico entered into that certain Guaranty Agreement dated as of January 31, 1997 (collectively, as amended or amended and restated, as the case may be, the “Additional Senior Guaranty Agreements”).

G. As a condition to the issuance of the Original Senior Notes, World Finance Corporation of South Carolina, World Finance Corporation of Georgia, World-TX, World-OK and World Finance Corporation of Louisiana entered into those separate Security Agreements and Indentures of Trust each dated as of December 1, 1992, as amended or amended and restated, as the case may be (the “Original Subsidiary Security Agreements”).

H. Pursuant to Section 3.29 of Original World Security Agreement, (i) World Acceptance Corporation of Alabama entered into that certain Security Agreement and Indenture of Trust dated as of July 11, 1994, (ii) World-MO entered into that certain Security Agreement and Indenture of Trust dated as of April 2, 1993, (iii) World Finance Corporation of Tennessee entered into that certain Security Agreement and Indenture of Trust dated as of April 2, 1993, (iv) WFC-LP entered into that certain Security Agreement, Pledge and Indenture of Trust dated as of July 1, 1995, (v) WFC-SC entered into that certain Security Agreement and Indenture of Trust dated as of September 1, 1995, (vi) World Finance Corporation of Illinois entered into that certain Security Agreement and Indenture of Trust dated as of March 14, 1996 and (vii) World Finance Corporation of New Mexico entered into that certain Security Agreement and Indenture of Trust dated as of May 31, 1997 (collectively, as amended or amended and restated, as the case may be, the “Additional Subsidiary Security Agreements”).

I. World has entered into the Amended and Restated Note Agreements dated as of June 30, 1997 (the “Senior Note Agreements”), which Senior Note Agreements amend and

-2-

Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

restate the Original Senior Note Agreements and which Senior Secured Notes amend and restate the Original Senior Secured Notes; the Original Senior Secured Notes as amended and restated and as the same may from time to time be amended or restated pursuant to the terms thereof and of the Senior Note Agreements and any notes executed in replacement thereof (the “Senior Secured Notes”). World has also entered into the Amended and Restated Revolving Credit Agreement dated as of June 30, 1997 (the “Revolving Credit Agreement”), which Revolving Credit Agreement amends and restates the Original Revolving Credit Agreement and the Original Revolving Credit Notes and provides for borrowings, whether or not such borrowings are evidenced by promissory notes and as the same may from time to time be amended or restated pursuant to the terms thereof and any notes executed in replacement thereof, in a maximum principal amount of borrowings at any one time outstanding not to exceed the Maximum Principal Amount (the “Revolving Credit Notes”). The Senior Secured Notes and the Revolving Credit Notes are hereinafter collectively referred to as the “Senior Notes.” World has also authorized, on the terms provided in the Senior Subordinated Note Agreement dated as of June 30, 1997 ( the “Senior Subordinated Note Agreement”), the issuance of $10,000,000 aggregate principal amount of Senior Subordinated Secured Notes due June 30, 2004, as the same may from time to time be amended or restated pursuant to the terms thereof and of the Senior Subordinated Note Agreement and any notes executed in replacement thereof (the “Senior Subordinated Notes”). The Senior Notes and the Senior Subordinated Notes are hereinafter collectively referred to as the “Notes.”

J. In connection with the above-described transactions, World has entered into the Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (the “World Security Agreement”), which amends and restates the Original World Security Agreement.

K. In connection with the above-described transactions, each Company agreed (i) to amend and restate the Original Senior Guaranty Agreement or Additional Senior Guaranty Agreement, as the case may be, to which it is a party by entering into the Amended and Restated Guaranty Agreement dated as of June 30, 1997 (the “Senior Guaranty Agreement”) and (ii) to enter into the Guaranty Agreement dated as of June 30, 1997 (the “Senior Subordinated Guaranty Agreement,” and collectively with the Senior Guaranty Agreement, the “Subsidiary Guaranty Agreements”).

L. As a condition to the above-described transactions, the Noteholders require that each Company enter into this Agreement for purposes of, inter alia, securing the obligations of World under the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement and the Notes. The World Security Agreement requires that, upon formation or acquisition of any new Restricted Subsidiary, World cause such subsidiary to enter into a Security Agreement Supplement on the terms set forth herein.

M. The Companies desire that World comply with the provisions of the World Security Agreement, the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement and the Notes. By entering into the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement, the respective holders of the Notes have conferred financial and other benefits on the Companies.

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N. Each Company agrees to amend and restate the Original Subsidiary Security Agreement or Additional Subsidiary Security Agreement, as the case may be, to which it is a party on the terms set forth herein for purposes of securing the obligations (i) of World under the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement and the Notes and (ii) of each other Company under the Subsidiary Guaranty Agreements.

O. Each Company is authorized by law, and deems it necessary to secure the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement and the Notes as hereinafter provided, and to that end, in the exercise of said authority, has duly authorized the execution and delivery of this Agreement providing for the securing of certain obligations of World and each other Company, all as hereinafter provided.

P. All acts and proceedings required by law and by the respective Governing Documents of each Company necessary to constitute this Agreement a valid and binding agreement for the uses and purposes herein set forth, in accordance with its terms, have been done and taken, and the execution and delivery of this Agreement has been in all respects duly authorized.

SECTION 1. INTERPRETATION OF AGREEMENT; DEFINITIONS.

Section 1.1. Definitions. Unless the context otherwise requires, the terms hereinafter set forth when used herein shall have the following meanings and the following definitions shall be equally applicable to both the singular and plural forms of any of the terms herein defined:

“Account Debtor” shall mean any Person who is or may become obligated to any Company under or on account of a Receivable.

“Affiliate” shall mean, with respect to any Company, any Person (other than a Restricted Subsidiary) (i) which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such Company, (ii) which beneficially owns or holds 5% or more of any class of the Voting Stock (determined by number of shares or by number of votes) of such Company or (iii) 5% or more of the Voting Stock (determined by number of shares or by number of votes) (or in the case of a Person which is not a corporation, 5% or more of the equity interest) of which is beneficially owned or held by such Company or a Subsidiary. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of Voting Stock, by contract or otherwise.

“Agent” shall mean Harris Trust and Savings Bank and its permitted successors and assigns, in each case in its capacity as agent for the Banks under the Revolving Credit Agreement.

“Aggregate Principal Amount of the Outstanding Notes” shall mean (i) for purposes of §8.1 (A) if any Senior Note or any obligation or liability owing under the Revolving Credit Agreement or the Senior Note Agreement remains outstanding or any obligation to extend credit

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under the Revolving Credit Agreement exists, the sum of the actual principal amount of the Senior Notes then outstanding, and (B) if no Senior Note and no other obligation or liability owing under the Revolving Credit Agreement or the Senior Note Agreement is then outstanding and all obligations to extend credit under the Revolving Credit Agreement have expired or otherwise terminated, the sum of the actual principal amount of the Senior Subordinated Notes then outstanding, (ii) for purposes of §8.7 and §8.8, the sum of the actual principal amount of the Notes then outstanding, plus the amount of the unused commitment with respect to the Revolving Credit Notes and (iii) for purposes of §9.2 and §10.4 (A) so long as no Event of Default shall have occurred and be continuing, the sum of the actual principal amount of Notes then outstanding, plus the amount of the unused commitment with respect to the Revolving Credit Notes and (B) if an Event of Default shall have occurred and be continuing, the actual principal amount of the Notes then outstanding.

“Banks” shall mean Harris Trust and Savings Bank, The First National Bank of Chicago, LaSalle National Bank and the other banks or financial institutions that are or become a party to the Revolving Credit Agreement.

“Closing Date” shall mean July 3, 1997.

“Collateral” as used herein shall mean any and all property from time to time subject to the security interest granted hereby.

“Company” shall mean each of World Acceptance Corporation of Alabama, an Alabama corporation, World Acceptance Corporation of Missouri, a Missouri corporation, World Finance Corporation of Georgia, a Georgia corporation, World Finance Corporation of Louisiana, a Louisiana corporation, World Acceptance Corporation of Oklahoma, Inc., an Oklahoma corporation, World Finance Corporation of South Carolina, a South Carolina corporation, World Finance Corporation of Tennessee, a Tennessee corporation, World Finance Corporation of Texas, a Texas corporation, WFC Limited Partnership, a Texas limited partnership, WFC of South Carolina, Inc., a South Carolina corporation, World Finance Corporation of Illinois, an Illinois corporation, and World Finance Corporation of New Mexico, a New Mexico corporation, any entity that executes and delivers a Security Agreement Supplement in the form attached hereto as Exhibit A, and any Person which succeeds to all, or substantially all of the assets and business of any such entity.

“Consolidated Adjusted Net Worth” shall have the meaning specified in the Senior Subordinated Note Agreement as in effect on the Closing Date.

“Corporate Base Rate” means for any day the rate of interest announced by Harris Trust and Savings Bank from time to time as its prime commercial rate, or equivalent, with any change in the Corporate Base Rate resulting from a change in said prime commercial rate to be effective as of the date of the relevant change in said prime commercial rate.

“Default” shall mean any event or condition, the occurrence of which would, with the lapse of time or the giving of notice, or both, constitute an Event of Default.

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“Event of Default” shall have the meaning specified in §7.1.

“Environmental Legal Requirement” shall mean any international, Federal, state or local statute, law, regulation, order, consent decree, judgment, permit, license, code, covenant, deed restriction, common law, treaty, convention, ordinance or other requirement relating to public health, safety or the environment, including without limitation, those relating to releases, discharges or emissions to air, water, land or ground water, to the withdrawal or use of groundwater, to the use and handling of polychlorinated biphenyls or asbestos, to the disposal, treatment, storage or management of hazardous or solid waste, or Hazardous Substances or crude oil, or any fraction thereof, or to exposure to toxic or hazardous materials, to the handling, transportation, discharge or release of gaseous or liquid Hazardous Substances and any regulation, order, notice or demand issued pursuant to such law, statute or ordinance, in each case applicable to the property of World or any of its Subsidiaries or the operation, construction or modification of any thereof, including without limitation the following: the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 and the Hazardous and Solid Waste Amendments of 1984, the Hazardous Materials Transportation Act, as amended, the Federal Water Pollution Control Act, as amended by the Clean Water Act of 1976, the Safe Drinking Water Control Act, the Clean Air Act of 1966, as amended, the Toxic Substances Control Act of 1976, the Occupational Safety and Health Act of 1977, as amended, the Emergency Planning and Community Right-to-Know Act of 1986, the National Environmental Policy Act of 1975 and the Oil Pollution Act of 1990 and any similar or implementing state law, and any state statute and any further amendments to these laws, providing for financial responsibility for cleanup or other actions with respect to the release or threatened release of Hazardous Substances or crude oil, or any fraction thereof and all rules, regulations, guidance documents and publication promulgated thereunder.

“GAAP” shall mean generally accepted accounting principles at the time in the United States.

“Governing Documents” shall mean collectively the charter instruments, by-laws, partnership agreements, operating agreements and other similar documents prescribing the internal governance of each Restricted Subsidiary.

“Hazardous Substances” shall mean any hazardous or toxic material, substance or waste pollutant or contaminant which is regulated as such under any statute, law, ordinance, rule or regulation of any Federal, regional, state or local authority having jurisdiction over the property of World or any Subsidiary or its use, including but not limited to any material, substance or waste which is: (a) defined as a hazardous substance under Section 311 of the Federal Water Pollution Control Act (33 U.S.C. §1317), as amended; (b) regulated as a hazardous waste under Section 1004 of the Federal Resource Conservation and Recovery Act (42 U.S.C. §6901 et seq.), as amended; (c) defined as a hazardous substance under Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, as amended; (d) defined or regulated as a hazardous substance or hazardous waste under any rules or regulations promulgated under any of the foregoing statutes or (e) petroleum or products derived therefrom.

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“Indebtedness for Borrowed Money” shall have the meaning specified in the Senior Subordinated Note Agreement as in effect on the Closing Date.

“Insurance Subsidiary” shall mean any one Subsidiary (i) which is organized under the laws of the British Virgin Islands or such other jurisdiction as shall be consented to in writing by all of the holders of the Notes; (ii) which conducts substantially all of its business and has substantially all of its assets within the British Virgin Islands or such other jurisdiction as shall be consented to in writing by all of the holders of the Notes; (iii) of which 100% (by number of votes) (other than directors’ qualifying shares) of the Voting Stock is owned by World; and (iv) which is engaged in the business of reinsuring the credit insurance written by the Subsidiaries.

“Investment Property” shall have the meaning specified in §2.5.

“Lien” shall mean any interest in property securing an obligation owed to a Person, whether such interest is based on the common law, statute or contract, and including but not limited to the security interest arising from a mortgage, security agreement, encumbrance, pledge, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. The term “Lien” includes reservations, exceptions, encroachments, easements, rights of way, covenants, conditions, restrictions, leases and other similar title exceptions and encumbrances, including but not limited to mechanics’, materialmen’s, warehousemen’s, carriers’ and other similar encumbrances, affecting property. For the purposes of this Agreement, a Person shall be deemed to be the owner of any property which it has acquired or holds subject to a conditional sale agreement or other arrangement pursuant to which title to the property has been retained by or vested in some other Person for security purposes.

“Make-Whole Amount” (i) with respect to the Senior Secured Notes, shall have the meaning as defined in the Senior Note Agreements and (ii) with respect to the Senior Subordinated Notes, shall have the meaning as defined in the Senior Subordinated Note Agreement.

“Material Event of Default” shall mean (i) an Event of Default shall have occurred under any of Sections 6.1(a), (b), (c), (n), (o), (p) or (q) of any Senior Note Agreement, (ii) an Event of Default shall have occurred under any of Sections 9.1(a), (b), (c), (n), (p), (q) or (r) of the Revolving Credit Agreement, (iii) an Event of Default shall have occurred with respect to Sections 5.7, 5.8, 5.9, 5.10, 5.11 (but only to the extent such Event of Default relates to a Lien on property of World or any Restricted Subsidiary with a fair market value in excess of $1,000,000), 5.12, 5.13 or 5.18 of any Senior Note Agreement or (iv) an Event of Default shall have occurred with respect to Sections 8.7, 8.8, 8.9, 8.10, 8.11 (but only to the extent such Event of Default relates to a Lien on property of World or any Restricted Subsidiary with a fair market value in excess of $1,000,000), 8.12, 8.13 or 8.18 of the Revolving Credit Agreement.

“Maximum Principal Amount” shall mean an amount equal to (i) $65,000,000, plus (ii) any principal amount in excess thereof agreed to in writing by the holders of the Senior Subordinated Notes, plus (iii) any principal amount in excess thereof; provided, that, at the time of any increase in the amount of the commitment of the Banks under the Revolving Credit

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Agreement, the Agent shall have received a certificate or certificates of the Chief Financial Officer of World and an authorized officer of each holder of the Senior Subordinated Notes, in each case, certifying that on the date of such increase and after giving effect thereto and, in the case of clause (B) below, after giving effect to the treatment of the maximum aggregate amount of the commitment as so increased as having been incurred as Indebtedness for Borrowed Money on the last day of the calendar month then most recently ended and, in the case of any certificate delivered by any holder of the Senior Subordinated Notes, to the knowledge of such holder, (A) there does not exist any Default or Event of Default under clauses (a), (b), (c), (n), (o), (p) or (q) of Section 6.1 of the Senior Subordinated Note Agreement as in effect on the Closing Date or under Sections 5.7, 5.8, 5.9, 5.10, 5.11 (but only to the extent such Default or Event of Default relates to a Lien on property of World or any Restricted Subsidiary with a fair market value in excess of $1,000,000), 5.12, 5.13 or 5.18 of the Senior Subordinated Note Agreement as in effect on the Closing Date and (B) the ratio of Indebtedness for Borrowed Money of World and its Restricted Subsidiaries to Consolidated Adjusted Net Worth for the calendar month then most recently ended does not exceed 6.5 to 1.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Note Register” (i) with respect to the Senior Secured Notes, shall have the meaning specified in Section 9.1 of the Senior Note Agreements and (ii) with respect to the Senior Subordinated Notes, shall have the meaning specified in Section 10.1 of the Senior Subordinated Note Agreement.

“Noteholders” shall mean, collectively, the holders from time to time and at any time of the Notes.

“Notes” shall have the meaning specified in the recitals hereof.

“Original Closing Date” shall mean December 29, 1992.

“Partnership Interests” shall have the meaning specified in §2.6.

“Person” shall mean an individual, partnership, corporation, limited liability company, trust or unincorporated organization, and a government agency or political subdivision thereof.

“Pledged Collateral” shall mean and include:

(a) the Pledged Shares;

(b) all shares, Securities, moneys, or other property distributed as a dividend on any shares of capital stock or other Pledged Collateral (including the Pledged Shares) at any time pledged hereunder or a distribution or return of capital upon or in respect of any such capital stock or other Pledged Collateral or any part thereof, or resulting from a split-up, revision, reclassification or other like change of any such capital stock or other Pledged Collateral, and any subscription warrants, rights or options issued to the holders of, or otherwise in respect of, any such capital stock or other Pledged Collateral; and

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(c) in the event of any consolidation or merger in which the issuer of any Pledged Collateral is not the surviving entity, or in the event of any sale, lease, transfer or other disposition of all or substantially all of the assets of such issuer;

(i) all shares of each class of the capital stock or other Security of the successor entity formed by or resulting from such consolidation or merger, or of the corporation to which such sale, lease, transfer or other disposition shall have been made, and

(ii) all other Securities, money or property, distributed or distributable in any such event in respect of any of the Pledged Collateral in connection with such consideration, merger, sale, lease, transfer or other disposition.

“Pledged Shares” shall mean all of the capital stock, partnership interests, membership interests and other equity interests owned by any Company or hereafter acquired, including, without limitation, (a) all rights, authority, powers and privileges of such Company as a shareholder or holder of any partnership interest, membership interest or other equity interest of any entity, whether now existing or hereafter arising under the Governing Documents, or at law or otherwise, and the rights of such Company under such Governing Documents to acquire additional shares of stock or to acquire the shares of stock of other shareholders or the partnership interest, membership interest or other equity interest from any such other holder, and (b) all other instruments owned or held by, or otherwise established in favor of, such Company in the nature of capital stock of, partnership interest, membership interest or any other equity interest in any entity, of any and every type, class and series.

“Receivables” shall mean all accounts receivable, receivables, contract rights, controls, instruments, notes, drafts, bills, acceptances, documents, chattel paper, general intangibles and all other forms of obligations owing to a Person.

“Restricted Subsidiary” shall mean the Insurance Subsidiary, if any, and any other Subsidiary (i) which is organized under the laws of the United States or any State thereof; (ii) which conducts substantially all of its business and has substantially all of its assets within the United States; and (iii) of which 100% (by number of votes) of the Voting Stock is owned by World and/or one or more Restricted Subsidiaries.

“Revolving Credit Agreement” shall mean that certain Amended and Restated Revolving Credit Agreement dated as of June 30, 1997 among World, the Agent and the Banks, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Revolving Credit Notes” shall have the meaning specified in the recitals hereof.

“S&P” shall mean Standard & Poor’s Ratings Services Group, a division of The McGraw-Hill Companies, Inc.

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“Secured Indebtedness” shall mean (i) the outstanding Notes and all principal thereof (and premium, if any) and interest thereon pursuant to the terms of the outstanding Notes, the World Security Agreement, the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement; provided, that, in no event shall “Secured Indebtedness” include (A) the principal amount of the Revolving Credit Notes in excess of the Maximum Principal Amount and (B) the related interest thereon and (ii) all additional amounts and other sums at any time due and owing from or required to be paid by World or any Company under the terms of this Agreement, the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement, the Subsidiary Security Agreement and the Subsidiary Guaranty Agreements, as in effect on the Closing Date or as otherwise consented to in writing by all of the holders of the Notes.

“Security” shall have the same meaning as in Section 2(a)(1) of the Securities Act of 1933, as amended.

“Security Trustee” means the Person named above as the “Security Trustee” in the first paragraph of this Agreement until a successor Security Trustee shall have become such pursuant to the applicable provisions of this Agreement, and thereafter “Security Trustee” shall mean such successor Security Trustee.

“Senior Note Agreements” shall mean, collectively, the separate Amended and Restated Note Agreements, each dated as of June 30, 1997, between World and the respective note purchasers named therein, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Senior Notes” shall have the meaning specified in the recitals hereof.

“Senior Secured Notes” shall have the meaning specified in the recitals hereof.

“Senior Subordinated Note Agreement” shall mean that certain Note Agreement dated as of June 30, 1997 between World and the purchaser named therein, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Senior Subordinated Notes” shall have the meaning specified in the recitals hereof.

The term “subsidiary” shall mean, as to any particular parent corporation, any corporation, partnership, limited liability company, or other entity of which more than 50% (by number of votes or other decision-making authority) of the Voting Stock shall be owned by such parent corporation and/or one or more corporations, partnerships, limited liability companies or other entities which are themselves subsidiaries of such parent corporation. The term “Subsidiary” shall mean a subsidiary, directly or indirectly, of World.

“Subsidiary Guaranty Agreements” shall mean (i) the Amended and Restated Guaranty Agreement dated as of June 30, 1997 of each Restricted Subsidiary existing on the Closing Date and each other Restricted Subsidiary which has executed a Guaranty Supplement in the form of Exhibit A thereto, pursuant to the terms thereof and Section 3.9 of the World Security

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Agreement, in each case, for the benefit of the Security Trustee and the holders of the Senior Notes, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof, and (ii) the Guaranty Agreement dated as of June 30, 1997 of each Restricted Subsidiary existing on the Closing Date and each other Restricted Subsidiary which has executed a Guaranty Supplement in the form of Exhibit A thereto, pursuant to the terms thereof and Section 3.9 of the World Security Agreement, in each case, for the benefit of the Security Trustee and the holders of the Senior Subordinated Notes, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Underlying Collateral” shall mean, with respect to any Receivable of any Company, all of its rights with respect to any collateral granted by the Account Debtor in connection with any loan.

“Uniform Commercial Code” as used herein with reference to any collateral shall mean the Uniform Commercial Code as enacted in the jurisdiction applicable to such Collateral, as amended from time to time, and any successor statute(s) thereto.

“Unsecured Receivables” shall mean Receivables which are not secured by Underlying Collateral or otherwise.

“Voting Stock” shall mean Securities or other equity interests of any class or classes, the holders of which are ordinarily, in the absence of contingencies, entitled to elect a majority of the corporate directors (or Persons performing similar functions).

“WFC-LP” shall mean WFC Limited Partnership, a Texas limited partnership.

“WFC-SC” shall mean WFC of South Carolina, Inc., a South Carolina corporation.

“World-MO” shall mean World Acceptance Corporation of Missouri, a Missouri corporation.

“World-NM” shall mean World Finance Corporation of New Mexico, a New Mexico corporation.

“World-OK” shall mean World Acceptance Corporation of Oklahoma, Inc., an Oklahoma corporation.

“World Security Agreement” shall mean that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 between World and the Security Trustee, as the same may be amended, restated, supplemented or waived from time to time by any amendments and supplements thereto entered into in accordance with the terms thereof.

“World-TX” shall mean World Finance Corporation of Texas, a Texas corporation.

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Section 1.2. Accounting Principles. Where the character or amount of any asset or liability or item of income or expense is required to be determined or any consolidation or other accounting computation is required to be made for the purposes of this Agreement, the same shall be done in accordance with GAAP, to the extent applicable, except where such principles are inconsistent with the requirements of this Agreement.

Section 1.3. Directly or Indirectly. Where any provision in this Agreement refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether the action in question is taken directly or indirectly by such Person.

SECTION 2. GRANTING CLAUSES.

Each Company in consideration of the premises and other good and valuable consideration, receipt whereof is hereby acknowledged, and intending to be legally bound, and in order to secure (i) the equal and pro rata payment of both the principal of and interest and premium, if any, on all Senior Notes at any time outstanding according to their tenor and effect, (ii) on a senior subordinated basis as set forth herein and in the Senior Subordinated Note Agreement, the equal and pro rata payment of both the principal of and interest and premium, if any, on all Senior Subordinated Notes at any time outstanding, according to their tenor and effect, and (iii) the payment of all other Secured Indebtedness and the performance and observance of all the covenants and conditions contained in the Notes, this Agreement, the World Security Agreement, the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement, and the Subsidiary Guaranty Agreements, in each case, subject to the terms thereof and of §7.5, does hereby mortgage, grant, convey, warrant, assign, pledge and hypothecate unto the Security Trustee, its successors in trust and assigns, forever, and grants to the Security Trustee, its successors in trust and assigns, forever, a continuing security interest in, all and singular the following described properties, rights, interests and privileges, together with the proceeds thereof, now or hereafter owned by such Company (hereinafter sometimes referred to as the “Collateral”):

Section 2.1. Equipment. All building materials, building equipment, machinery, apparatus, furniture and equipment and other personal property (other than motor vehicles and accessions to motor vehicles) of every kind and nature whatsoever located, including without limitation: all air conditioning, ventilating, plumbing, heating, lighting and electrical systems and apparatus; all communications equipment and intercom systems and apparatus; all typewriters, computers and other office machines and equipment, furniture, furnishings; all sprinkler equipment and apparatus, all elevators and escalators; and all machinery, equipment, engines, boilers, tools, furniture, carpeting, tables and chairs, together with all accessories, parts and appurtenances appertaining or attached thereto, whether now owned or hereafter acquired, and all substitutions, renewals, or replacements of and additions, improvements, accessions and accumulations to any and all thereof, together with all the rents, income, revenues, issues, proceeds, profits and avails arising therefrom or in connection therewith and excluding, in all cases, any of the foregoing items of property which are deemed fixtures;

Section 2.2. Receivables. Receivables, whether now existing or hereafter arising, and however evidenced or acquired, or in which such Company now has or hereafter acquires any

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rights and all rights of such Company to any Underlying Collateral granted by an Account Debtor in connection with any Receivable owing by it to such Company;

Section 2.3. Pledged Collateral. The Pledged Collateral;

Section 2.4. General Intangibles. General intangibles of such Company, including, without limitation, tax refunds, rights with respect to trademarks, service marks, trade names, patents, copyrights, trade-secrets information and rights to prevent others from doing acts that constitute unfair competition with or misappropriation of property of such Company including, without limitation, any sums (net of expenses) that such Company may receive arising out of any claim for infringement of its rights in any patent, copyright, trademark, trade name, trade secret or other proprietary right and all rights of such Company under contracts to enjoy performance by others or to be entitled to enjoy rights granted by others, including, without limitation, any licenses (to the extent permitted by law);

Section 2.5. Investment Property. All Investment Property, whether now owned or existing or hereafter created, acquired or arising, or in which such Company now has or hereafter acquires any rights (the term “Investment Property” means and includes all investment property and any other securities (whether certificated or uncertificated), security entitlements, securities accounts, commodity contracts and commodity accounts, including all substitutions and additions thereto, all dividends, distributions and sums distributable or payable from, upon, or in respect of such property, and all rights and privileges incident to such property, but excludes the Pledged Collateral);

Section 2.6. Records and Cabinets. Supporting evidence and documents relating to any of the above-described property, including without limitation, written applications, credit information, account cards, payment records, correspondence, delivery and installation certificates, invoice copies, delivery receipts, notes and other evidences of indebtedness, insurance certificates and the like, together with all books of account, data processing records, computer software and licenses to use the same, ledgers and cabinets in which the same are reflected or maintained, all whether now existing or hereafter arising;

Section 2.7. Partnership Interests. (i) All right, title and interest of such Company, whether now owned or hereafter acquired, in all partnerships or limited liability companies, including, but not limited to, those set forth on Schedule II hereto (collectively, the “Partnerships”), (ii) any and all payments or distributions of whatever kind or character and whether in cash or other property, at any time made, owing or payable to such Company in respect of or on account of its present or hereafter acquired interest in the Partnerships, whether due or to become due and whether representing profits, distributions pursuant to complete or partial liquidation or dissolution, repayment of capital contributions or otherwise, and the right to receive, receipt for, use and enjoy all such payments and distributions, and all proceeds thereof, in every case whether now arising or hereafter acquired or arising, and (iii) all proceeds of any of the foregoing (all of the foregoing rights, interests, properties and privileges assigned in and in which a security interest is granted pursuant to this §2.7 being hereafter collectively called the “Partnership Interest”);

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Section 2.8. Additional Property. All property and rights, if any, which are by the express provisions of this Agreement required to be subjected to the lien hereof and any additional property and rights that may from time to time hereafter, by writing of any kind, be subjected to the lien hereof by such Company or by anyone acting at the direction or as an agent of such Company; and

Section 2.9. Other Proceeds and Products. All proceeds and products of the foregoing and all insurance of the foregoing and proceeds thereof, whether now existing or hereafter arising.

TO HAVE AND TO HOLD the Collateral, WITH POWER OF SALE and right of entry and possession, unto the Security Trustee, its successors and assigns, forever; IN TRUST NEVERTHELESS, upon the terms and trust herein set forth, for the equal and proportionate benefit, security and protection of all present and future holders of the Senior Notes outstanding hereunder from and after the issuance of the Senior Notes, without preference, priority or distinction of any Senior Note over any other Senior Note by reason of series, priority of time of issue, sale, negotiation, time of any extensions of credit evidenced thereby, date of maturity thereof or otherwise for any cause whatsoever and, on a senior subordinated basis as set forth herein and in the Senior Subordinated Note Agreement, for the equal and proportionate benefit, security and protection of all present and future holders of the Senior Subordinated Notes outstanding hereunder from and after the issuance of the Senior Subordinated Notes, without preference, priority or distinction of any Senior Subordinated Note over any other Senior Subordinated Note by reason of series, priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any cause whatsoever; provided always, however, that these presents are upon the express condition that if the Companies shall irrevocably pay or cause to be irrevocably paid all the Secured Indebtedness and all obligations to extend Senior Indebtedness have expired or otherwise terminated, then these presents and the estate hereby granted and conveyed shall cease and this Agreement shall become null and void; otherwise this Agreement shall remain in full force and effect.

SECTION 3. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANIES.

Each Company hereby covenants with, and represents and warrants to, the Security Trustee and for the benefit of the holders of the Notes from time to time that:

Section 3.1. Location of Collateral. The Collateral (other than the Underlying Collateral and the Pledged Collateral) relating to such Company and the books and records relating thereto are in such Company’s possession at the offices and facilities owned or leased by such Company or World set forth in Schedule III hereto. Not less than ten days before the opening of any additional business location which would require the filing of an additional financing statement in accordance with the Uniform Commercial Code in order to perfect the security interest of the Security Trustee in the Collateral relating to such Company and the books and records relating thereto or any change in the business location where the Collateral relating to such Company and the books and records relating thereto are located and/or maintained which would require the filing of an additional financing statement in accordance with the Uniform Commercial Code in order to perfect the security interest of the Security Trustee in the Collateral relating to such

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Company, such Company will deliver to the Security Trustee a supplement hereto amending Schedule III to include such business location, together with evidence of the filing of financing statements or other notices of the security interest hereof and an opinion of such Company’s counsel responsive to the requirements of §3.8 hereof. On or before the fifth day of every December of every year, such Company will deliver to the Security Trustee a supplement hereto amending Schedule III to include any additional business locations not previously reflected in a supplement hereto.

Section 3.2. Warranty of Title. Such Company is the lawful owner of the Collateral relating to such Company and has the sole right and lawful authority to deliver this Agreement. The Collateral relating to such Company and every part thereof is, on the Closing Date, free and clear of all Liens, except the Lien of this Agreement and will be free and clear of all Liens, except the Lien of this Agreement and the other Liens of the character described in clauses (e), (f), (g) and (h) of Section 5.11 of the Senior Note Agreements and the Senior Subordinated Note Agreement and in clauses (e), (f), (g) and (h) of Section 8.11 of the Revolving Credit Agreement, and such Company will warrant and defend the Collateral relating to such Company, against any claims and demands of all Persons at any time claiming the same or any interest therein adverse to the Security Trustee.

Section 3.3. No Alienation of Collateral. Except as permitted by the provisions of Section 5.13 of the Senior Note Agreements and the Senior Subordinated Note Agreement and Section 8.13 of the Revolving Credit Agreement, such Company will not, without the Security Trustee’s prior written consent, sell, assign, mortgage, lease or otherwise dispose of the Collateral relating to such Company or any interest therein.

Section 3.4. Removal of Collateral. Such Company will not remove the Collateral relating to such Company and/or the books and records relating thereto from the locations relating to such Company set forth in Schedule III hereto (i) without complying with §3.1 hereof or (ii) without the Security Trustee’s prior written consent (provided that such Company may move items of Collateral relating to such Company among such locations). Such Company will at all times allow the Security Trustee, the holders of the Notes and their representatives free access to, and right of inspection of, the Collateral relating to such Company.

Section 3.5. Compliance with Leases. Such Company will comply with the terms and conditions of any leases covering the premises wherein the Collateral relating to such Company is located and any orders, ordinances, laws or statutes of any city, state or other governmental entity, department or agency having jurisdiction with respect to such premises or the conduct of business thereon unless the failure to so comply will not, individually or in the aggregate, have a material adverse effect on such Collateral or impair the rights or interests of World, such Company, any other Restricted Subsidiary or the Security Trustee therein.

Section 3.6. Protection of Collateral. At any time and from time to time, the holder of any Notes may, at its option, or the Security Trustee may, at the direction of the holders of the Notes, discharge any taxes, or other Liens at any time levied or placed on the Collateral relating to such Company which are due and unpaid and (A) which are not being contested in good faith by appropriate actions or proceedings which will prevent the forfeiture or sale of the Collateral

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relating to such Company or any material interference with the use thereof or (B) for which such Company has not set aside on its books, reserves adequate in accordance with GAAP with respect thereto, and such parties may pay for the maintenance and preservation of the Collateral relating to such Company, including the purchasing of insurance therefor to the extent required to be maintained by World or such Company pursuant to Section 5.2 of the Senior Note Agreements and the Senior Subordinated Note Agreement and Section 8.2 of the Revolving Credit Agreement and not so maintained, and such Company will immediately reimburse the Security Trustee or such holder on demand for any payment made or any expense incurred by the Security Trustee or such holder pursuant to the foregoing authority with interest at a rate per annum equal to the higher of (i) 10.5% and (ii) the Corporate Base Rate plus 2%. All such expenses and payments shall have the benefit of and be secured by the security interest herein granted, and the Security Trustee is authorized to charge any depository account of such Company maintained with the Security Trustee or any holder of the Notes for the amount of such expenses and payments.

Section 3.7. Further Assurances. Such Company agrees to execute and deliver to the Security Trustee such further agreements and assignments or other instruments and to do all such other things as the Security Trustee may deem necessary or appropriate to assure the Security Trustee its first priority security interest hereunder (provided, that WFC-LP, World-MO or World-NM shall be required to deliver to the Security Trustee possession of promissory notes evidencing the Unsecured Receivables only upon the request of the Security Trustee during the existence of a Default or Event of Default hereunder), including such financing statement or statements or amendments thereof or supplements thereto or other instruments as the Security Trustee may from time to time reasonably require to perfect, and continue the perfection of, the security interest in the Collateral contemplated by this Agreement. Such Company hereby agrees that, to the extent permitted by applicable law, a carbon, photographic or other reproduction of this Agreement or any such financing statement is sufficient for filing as a financing statement by the Security Trustee without notice thereof to such Company wherever the Security Trustee in its sole discretion desires to file the same. The Security Trustee shall, when an Event of Default shall have occurred and be continuing, or at such other time pursuant to §4 or §5, have the right to take physical possession of any and all of the Collateral relating to such Company and to maintain such possession on such Company’s premises or, if possible, to remove the Collateral relating to such Company or any part thereof to such other places as the Security Trustee may desire. If the Security Trustee exercises its right to take possession of the Collateral relating to such Company, such Company shall, upon the Security Trustee’s demand, if possible, assemble the Collateral relating to such Company and make it available to the Security Trustee at a place designated by the Security Trustee. Such Company shall at its expense perform any and all other steps reasonably requested by the Security Trustee to preserve and protect the first priority security interest hereby granted in the Collateral. If any Collateral relating to such Company is in the possession or control of any of such Company’s agents or processors while a Default or an Event of Default shall have occurred and be continuing, such Company agrees (i) to notify such agents or processors in writing of the Security Trustee’s security interest therein, and (ii) upon the Security Trustee’s request instruct them to hold all such Collateral relating to such Company for the Security Trustee’s account and subject to the Security Trustee’s instructions. Such Company agrees to mark its books and records to reflect the security interest of the Security Trustee in the Collateral relating to such Company.

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Section 3.8. Maintenance of Lien; Recording; Opinions of Counsel. (a) Such Company will, at its expense, take all necessary action to maintain and preserve the first and prior perfected lien of this Agreement (including, without limitation, the filing of all financing statements or similar notices thereof if and to the extent permitted or required by applicable law) so long as any Notes are outstanding (provided, that WFC-LP, World-MO or World-NM shall be required to deliver to the Security Trustee possession of promissory notes evidencing the Unsecured Receivables only upon the request of the Security Trustee during the existence of a Default or Event of Default hereunder).

(b) Such Company will, forthwith after the execution and delivery of this Agreement and thereafter from time to time, cause this Agreement (and all financing statements, continuation statements or similar notices thereof if and to the extent permitted or required by applicable law) to be filed, registered and recorded in such manner and in such places as may be required by law in order to publish notice of and fully to protect the first lien of the Security Trustee in and to the Collateral relating to such Company (provided, that WFC-LP, World-MO or World-NM shall be required to deliver to the Security Trustee possession of promissory notes evidencing the Unsecured Receivables only upon the request of the Security Trustee during the existence of a Default or Event of Default hereunder); and from time to time will perform or cause to be performed any other acts as provided by law and will execute or cause to be executed any and all further instruments that may be required for such publication and protection or required by any Noteholder. With respect to any Investment Property held by a securities intermediary, commodity intermediary, or other financial intermediary of any kind, at the Security Trustee’s request, acting at the direction of the holders of the Notes, such Company shall execute and deliver, and shall cause any such intermediary to execute and deliver, an agreement among such Company, the Security Trustee and such intermediary in form and substance reasonably satisfactory to the Noteholders which provides, among other things, for the intermediary’s agreement that, upon notice by the Security Trustee that an Event of Default has occurred and is continuing, it shall comply with entitlement orders, and apply any value distributed on account of any Investment Property maintained in an account with such intermediary, as directed by the Security Trustee without further consent of such Company.

(c) Such Company agrees at its own expense to furnish to the Security Trustee promptly after the execution and delivery of any supplement or amendment hereto or any continuation statement, an opinion of counsel satisfactory to the Security Trustee (who may be independent counsel to such Company) stating that in the opinion of such counsel, such supplement or amendment to this Agreement (or a financing statement, continuation statement or similar notice thereof if and to the extent required by applicable law) or such continuation statement, as the case may be, has been properly recorded or filed for record in all public offices in which such recording or filing is necessary to perfect the Lien provided by this Agreement as a valid Lien and security interest in the Collateral relating to such Company; provided, such opinion shall be required with respect to any Unsecured Receivables of WFC-LP, World-MO and World-NM only after the occurrence and during the continuance of a Default or Event of Default hereunder.

Section 3.9. Consent to World Security Agreement, Etc. Such Company hereby consents to, and agrees to comply with, the terms and provisions of the World Security Agreement, the

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Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement.

Section 3.10. Names under which Each Company Conducts its Business. No Company conducts its business under any other name(s) other than as set forth opposite its name on Schedule IV hereto and such Company will not conduct business under any other name(s) (other than the names set forth opposite its name on Schedule IV hereto) without (i) providing the Security Trustee and the holders of the Notes with thirty (30) days’ prior written notice of such name and the location of where such business will be conducted under such name and (ii) complying with any and all requests made by the Security Trustee pursuant to §3.7 hereof.

SECTION 4. SPECIAL PROVISIONS RELATING TO RECEIVABLES.

Section 4.1. Representations and Warranties. As of the time any Receivable of any Company becomes subject to the security interest provided for hereby, such Company shall be deemed to have warranted as to such Receivables that:

(a) Such Receivable and all papers and documents relating thereto are genuine and in all respects what they purport to be;

(b) Such Receivable is legal, valid and subsisting;

(c) The amount of such Receivable represented as owing is the correct amount actually and unconditionally owing, is not disputed and is not subject to any set-offs, credits, deductions or countercharges;

(d) Such Receivable has been created, and is, in all respects in compliance with applicable state and federal lending laws and will continue to be in compliance with such laws, any Secured Receivable is secured by Underlying Collateral and, to the best knowledge of such Company, there is no violation of any Environmental Legal Requirement with respect to such Underlying Collateral;

(e) Such Company has no knowledge or reason to know of any fact which would impair the collectibility of such Receivable;

(f) All of such Company’s procedures, requirements and conditions and all federal and state laws applicable to the making of the loans related to such Receivable and the creation of such Receivable have been complied with;

(g) To the best knowledge of such Company, the Account Debtor on such Receivable and other obligors had legal capacity to enter into the transactions related to such Receivable;

(h) The form and content of each document related to such Receivable, the security related thereto, and the transactions from which it arose comply fully with any and all applicable laws, ordinances, rules and regulations, federal, state and/or local, with

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respect to the extension of credit and charging of interest, including without limitation, as applicable, the Federal Consumer Credit Protection Act, the Federal Fair Credit Reporting Act, the Federal Trade Commission Act, the Federal Equal Credit Opportunity Act and all federal, state and local laws related to licensing, usury, truth in lending, real estate settlement procedures, consumer protection, equal credit opportunity, fair debt collection, unfair and deceptive trade practices, rescission rights and disclosures, and with all rules and regulations thereunder, all as amended, and any disclosures required with respect to such Receivable were and will continue to be made properly and in a timely manner;

(i) To the best knowledge of such Company, such Receivable and all facts, statements or obligations contained or implicit in any application for credit or financial statement of the Account Debtor or other obligor submitted to such Company, including without limitation, the description of any Underlying Collateral securing such Receivable and the amount owing from the Account Debtor or other obligor, and the signatures of the parties are genuine, correct, true and complete;

(j) Such Company has extended no credit of any kind or in any manner to the Account Debtor or other obligors in connection with the transactions from which such Receivable arose other than as indicated on and evidenced by such Company’s files related to such Receivable;

(k) To the best knowledge of such Company, each security agreement, UCC filing, title retention instruments and other document and instrument, if any, which is security for such Receivable contains a correct and sufficient description of any Underlying Collateral covered thereby and each lien or security interest which secures such Receivable is and will continue to be valid;

(l) Before extending credit to the Account Debtor or other obligor on such Receivable, such Company has made an adequate credit investigation of the Account Debtor or other obligor and has determined that the risk of extending such credit is satisfactory and in accordance with the standards historically observed by such Company in the conduct of its business;

(m) Any and all policies of insurance related to the property securing any obligation of the Account Debtor in connection with such Receivable and any credit life insurance, credit disability insurance, or credit unemployment insurance are in full force and effect in accordance with the terms of all agreements between such Company and the Account Debtor; and

(n) As to such Receivable, such Company was duly authorized to do business and in good standing in the jurisdiction in which such Receivable was originated and was duly licensed to originate such Receivable in such jurisdiction.

Section 4.2. Receivable Schedules. Each Company shall provide the Security Trustee with such other relevant information as the Security Trustee may request from time to time.

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Section 4.3. Collection of Receivables. (a) Unless and until a Default or an Event of Default shall have occurred and be continuing and such Company shall have received written notice from the Security Trustee not to collect the Receivables, such Company shall make collection of all Receivables of such Company and may use the same to carry on its business in accordance with sound business practice and otherwise subject to the terms hereof.

(b) At any time while a Default or an Event of Default shall have occurred and be continuing, in the event the Security Trustee requests such Company to do so:

(i) All instruments and chattel paper at any time constituting part of the Receivables of such Company (including any postdated checks) shall, upon receipt by such Company and to the extent permitted by law, be immediately endorsed to and deposited with the Security Trustee in the same form as received by such Company; and/or

(ii) Such Company shall, to the extent permitted by law, instruct all account debtors to remit all payments in respect of Receivables of such Company to a lockbox to be maintained at the main post office, Chicago, Illinois, or such other single location as the Security Trustee may reasonably designate, under the sole custody and control of the Security Trustee.

(c) Except as otherwise directed by the Security Trustee, each Company shall immediately place the following legend conspicuously, on the face of each document, instrument, chattel paper and other writing evidencing the Receivables created on or after the Original Closing Date but before the Closing Date: “A SECURITY INTEREST IN THIS DOCUMENT HAS BEEN GRANTED TO HARRIS TRUST AND SAVINGS BANK, AS SECURITY TRUSTEE AND SECURED PARTY, PURSUANT TO THAT CERTAIN SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST DATED AS OF DECEMBER 1, 1992.” Except as otherwise directed by the Security Trustee, such Company shall, within ten days after the Closing Date, place the following legend conspicuously, on the face of each document, instrument, chattel paper and other writing evidencing the Receivables created on or after the Closing Date: “A SECURITY INTEREST IN THIS DOCUMENT HAS BEEN GRANTED TO HARRIS TRUST AND SAVINGS BANK, AS SECURITY TRUSTEE AND SECURED PARTY, PURSUANT TO A SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST.” At any time while a Default or an Event of Default shall have occurred and be continuing, the Security Trustee or its designee may notify such Company’s customers or account debtors at any time that Receivables of such Company have been assigned to the Security Trustee or of the Security Trustee’s security interest therein and either in its own name, that of such Company or both, demand, collect (including without limitation through a lockbox analogous to that described in §4.3(b)(ii) hereof), receive, receipt for, sue for, compound and give acquittance for any or all amounts due or to become due on such Receivables, and in the Security Trustee’s discretion file any claim or take any other action or proceeding which the Security Trustee may deem necessary or appropriate to protect and realize upon the security interest of the Security Trustee in such Receivables.

(d) In the event the Security Trustee has exercised any or all of its rights under §§4.3(b) or (c) hereof, the Security Trustee may, at any time while a Default or an Event of Default shall

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have occurred and be continuing, cause all instruments, chattel paper, moneys or other proceeds received by the Security Trustee to be deposited, handled and administered in and through a remittance account. If a Default or an Event of Default has occurred and is continuing to the knowledge of the Security Trustee, all amounts received by the Security Trustee pursuant to the Granting Clauses hereof and all amounts held in any remittance account referred to above in this paragraph shall be held by the Security Trustee for application in the manner provided for in §7 in respect of proceeds and avails of the Collateral.

Section 4.4. Power of Attorney. Upon the occurrence and during the continuance of a Default or an Event of Default, in addition to any other powers of attorney granted herein, each Company appoints the Security Trustee, its nominee, or any other Person whom the Security Trustee may designate as such Company’s attorney-in-fact, with full power at any time and from time to time to endorse such Company’s name on any checks, notes, acceptances, money orders, drafts or other forms of payment or security that may come into the Security Trustee’s possession, upon the occurrence and during the continuance of a Default or an Event of Default, to sign such Company’s name on any invoice or bill of lading relating to any Collateral of such Company, on drafts against customers, on schedules and assignments of Collateral of such Company, on notices of assignment, and other public records, on verification of accounts and on notices to customers, to notify the post office authorities to change the address for delivery of such Company’s mail to an address designated by the Security Trustee, to receive, open and dispose of all mail addressed to such Company, to send requests for verification of Receivables of such Company to customers or account debtors, and to do all things necessary to carry out this Agreement. Such Company ratifies and approves all acts of any such attorney and agrees that neither the Security Trustee nor any such attorney will be liable for any acts or omissions nor for any error of judgment or mistake of fact or law other than their willful misconduct or gross negligence. The foregoing power of attorney, being coupled with an interest, is irrevocable until the Secured Indebtedness is fully and irrevocably paid and satisfied and all obligations to extend credit under the Revolving Credit Notes have expired or otherwise terminated. The Security Trustee may file one or more financing statements disclosing its security interest in any or all of the Collateral without such Company’s signature appearing thereon. Such Company also hereby grants the Security Trustee a power of attorney to execute any such financing statement, or amendments and supplements to financing statements on behalf of such Company with notice thereof to such Company, which power of attorney is coupled with an interest and irrevocable until the Secured Indebtedness is fully paid and satisfied.

SECTION 5. SPECIAL PROVISIONS RELATING TO PLEDGED COLLATERAL.

Section 5.1. Delivery of Pledged Collateral; Transfer to Security Trustee. All instruments and certificates representing or evidencing the Pledged Collateral shall be delivered to and held by or on behalf of the Security Trustee for the ratable benefit of the holders of the Notes pursuant hereto and shall be in suitable form for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or assignment in blank and undated, all in form and substance satisfactory to the Security Trustee. The Security Trustee shall have the right, subject to applicable law, at any time in its discretion after the occurrence of an Event of Default, to transfer to or to register in the name of the Security Trustee or any of its nominees any or all of such Pledged Collateral. Promptly after any such transfer or registration, the Security

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Trustee shall give notice thereof to the Company that owns such Pledged Collateral, but the failure to give such notice shall not affect any of the rights or remedies of the Security Trustee hereunder. The Security Trustee shall have the right at any time to exchange instruments or certificates representing or evidencing such Pledged Collateral for instruments or certificates of smaller or larger denominations, subject to the terms thereof.

Section 5.2. Voting Power; Payments.

(a) Voting Power. So long as an Event of Default shall not have occurred and be continuing, each Company shall have the right to exercise any and all voting or other consensual rights pertaining to the Pledged Collateral relating to such Company or any part thereof for all purposes not inconsistent with the terms of this Agreement, the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement, and such Company agrees that it will not exercise any such rights in any manner which is inconsistent with the terms of this Agreement, the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement; provided, however, that such Company shall not exercise or shall refrain from exercising any such right if such action would have a material adverse affect on the value of the Pledged Collateral relating to such Company or any part thereof; the Security Trustee (1) shall have no right to exercise such voting rights as are reserved in this §5.2(a) to such Company and (2) shall execute and deliver to such Company or cause to be executed and delivered to such Company all such proxies, powers of attorney, and other orders, and all such instruments, without recourse, as such Company may reasonably request in writing for the purpose of enabling such Company to exercise the voting rights which it is entitled to exercise under this §5.2(a).

(b) Payments on Default. So long as no Default or Event of Default shall have occurred and be continuing, each Company shall have the right to receive and retain all cash distributions and payments made in respect of the Pledged Collateral relating to such Company to the extent such payments (1) may be legally declared and paid under applicable law and (2) are not prohibited by the applicable provisions hereof and of the Senior Note Agreements, the Revolving Credit Agreement or the Senior Subordinated Note Agreement; provided, however, that any and all

(i) dividends and distributions paid or payable other than in cash in respect of, and instruments and other property received, receivable or otherwise distributed in respect of, or in exchange for, any Pledged Collateral relating to such Company,

(ii) dividends and other distributions paid or payable in cash in respect of any Pledged Collateral relating to such Company in connection with a partial or total liquidation or dissolution or in connection with a reduction of capital, capital surplus or paid-in-surplus, and

(iii) cash paid, payable or otherwise distributed in redemption of, or in exchange for, any Pledged Collateral relating to such Company;

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shall be forthwith delivered to the Security Trustee to hold as, and such amounts so delivered shall be, Pledged Collateral and shall, if received by the Security Trustee, be received in trust for the benefit of the Security Trustee, be segregated from the other property or funds of such Company and be forthwith delivered to the Security Trustee as Pledged Collateral in the same form as so received (with all appropriate powers, authorizations, orders and documents).

(c) Voting Rights after an Event of Default and Receipt of Distributions after a Default or an Event of Default. Upon the occurrence and during the continuance of an Event of Default, all rights of each Company to exercise or refrain from exercising the voting and other consensual rights that it would otherwise be entitled to exercise pursuant to clause (a) above and, upon the occurrence and during the continuance of a Default or an Event of Default, all rights of each Company to receive the dividends and other distributions which it would otherwise be entitled to receive and retain pursuant to clause (b) above, in each such case, shall cease during the period and continuance of such Default or Event of Default, as the case may be, and all such rights shall thereupon become vested in the Security Trustee, which shall thereupon have the sole right to exercise or refrain from exercising such voting and other consensual rights, as directed in writing by the Noteholders pursuant to §8.1 hereof, and to receive and hold as Pledged Collateral such distributions and dividends.

Section 5.3. Covenants of Each Company. Each Company hereby covenants and agrees as follows:

(a) Issuance of Additional Securities. Such Company will not vote to enable or otherwise cause any issuer of Pledged Collateral relating to such Company to issue any shares of stock or other Securities in addition to, or to issue other securities of any nature in exchange or substitution for, the Pledged Collateral (except to qualify directors) unless such stock or other securities may be issued under the relevant provisions hereof, are pledged to the Security Trustee for the ratable benefit of the holders of the Notes as part of the Pledged Collateral and such Company represents to the Security Trustee and the holders of the Notes that (i) such Company has good and marketable title to such stock or other Security, free and clear of any Lien other than the Lien hereof and (ii) such stock or other Security has been duly authorized, validly issued and is fully paid and non-assessable.

(b) Regulatory Consent. Such Company will use its best efforts to obtain consent of any regulatory authority, Federal, state or local, if any, having jurisdiction over any license, franchise or other authorization granted by any governmental unit or authority, which consent may be required in connection with the transfer of the Pledged Collateral relating to such Company, and will cooperate fully with the Security Trustee in effecting any such transfer, including, without limitation, the execution and delivery of all applications, certificates and other documents that may be required to obtain the consent and approval or authorization of or registration or qualification with, any governmental authority, and specifically, without limitation, any application for consent to assignment of license or transfer of control necessary or appropriate under the rules and regulations of any governmental authority for approval of (1) any sale or sales of property constituting Pledged Collateral relating to such Company by or on behalf of the Security Trustee or

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(2) any assumption by the Security Trustee of voting rights or management rights in the Pledged Collateral relating to such Company, effected in accordance with the terms of this Agreement.

(c) Additional Pledged Collateral. If any of the Pledged Collateral, including, without limitation, any shares, notes, obligations, Securities, instruments, property or (except to the extent otherwise provided in clauses (b) and (c) in the definition of Pledged Collateral) moneys, distributions or other payments of every kind and variety referred to in clauses (a) through (c) in the definition of Pledged Collateral are received by such Company, such Company agrees forthwith to transfer and deliver the same (with the certificates or other instruments or documents evidencing or documenting any such shares, notes, obligations, interests, instruments, or other Securities duly endorsed in blank or accompanied by an assignment or assignments sufficient to transfer title thereto), to the Security Trustee to be held in pledge pursuant to the terms of this Agreement, as part of the Pledged Collateral.

(d) Schedule of Pledged Collateral. Such Company will furnish to the Security Trustee from time to time statements and schedules further identifying and describing the Pledged Collateral relating to such Company and such other reports in connection with the Pledged Collateral relating to such Company as the Security Trustee may reasonably request, all in reasonable detail.

SECTION 6. APPLICATION OF CERTAIN MONEYS.

Section 6.1. Application if no Default or Event of Default Exists. So long as no Default or Event of Default shall have occurred and be continuing, subject to each Company’s contractual obligations to other parties (including, without limitation, the Revolving Credit Agreement), such Company shall be allowed to receive and apply the Collateral relating to such Company and to carry on its business in accordance with sound business practices.

Section 6.2. Application if a Default or an Event of Default Exists. If a Default or an Event of Default has occurred and is continuing, all amounts which constitute Collateral shall be paid over to the Security Trustee for application in the manner provided in §7 in respect of proceeds and avails of the Collateral.

SECTION 7. DEFAULTS AND REMEDIES.

Section 7.1. Events of Default. An “Event of Default” under the Senior Note Agreements, the Revolving Credit Agreement or the Senior Subordinated Note Agreement shall constitute an Event of Default hereunder.

Section 7.2. Security Trustee’s Rights. Each Company agrees that when any Event of Default has occurred and is continuing, the Security Trustee may, subject to the provisions of §8.1, without limitation of all other rights and remedies available herein, in the World Security Agreement, at law or in equity in such event, exercise any one or more or all, and in any order, of

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the remedies hereinafter set forth, against one or more or all of the Companies, it being expressly understood that no remedy herein conferred is intended to be exclusive of any other remedy or remedies; but each and every remedy shall be cumulative and shall be in addition to every other remedy given herein or now or hereafter existing at law or in equity or by statute:

(a) The Security Trustee personally, or by agents or attorneys, shall have the right (subject to compliance with any applicable mandatory legal requirements) to enter into and upon the premises of any Company and take possession of all or any part of the Collateral and to exclude such Company wholly therefrom, and having and holding the same may use, operate, manage and control the Collateral and collect and receive all earnings, revenues, issues, proceeds and income of the Collateral and every part thereof and may maintain, repair and renew the Collateral and make replacements, alterations, additions and improvements thereto or remove and dispose of any portion of the Collateral and may otherwise exercise any and all of the rights and powers of such Company in respect thereof.

(b) The Security Trustee may, if at the time such action may be lawful and always subject to compliance with any mandatory legal requirements, either with or without taking possession, and either before or after taking possession, and without instituting any legal proceedings whatsoever, and having first given notice of such sale by registered mail to any affected Company and each holder of the Notes once at least ten days prior to the date of such sale, and any other notice which may be required by law, sell and dispose of the Collateral, or any part thereof, or interest therein, at public auction to the highest bidder, in one lot as an entirety or in separate lots, and either for cash or on credit and on such terms as the Security Trustee may determine, and at any place (whether or not it be the location of the Collateral or any part thereof) designated in the notice above referred to. Any such sale or sales may be adjourned from time to time by announcement at the time and place appointed for such sale or sales, or for any such adjourned sale or sales, without further notice, and the Security Trustee or the holder or holders of any Notes, or of any interest therein, may bid and become the purchaser at any such sale.

(c) The Security Trustee may proceed to protect and enforce this Agreement and the Notes by suit or suits or proceedings in equity, at law or in bankruptcy, and whether for the specific performance of any covenant or agreement herein contained or in execution or aid of any power herein granted; or for foreclosure hereunder, or for the appointment of a receiver or receivers for the Collateral or any part thereof, or for the recovery of judgment for the Secured Indebtedness or for the enforcement of any other proper, legal or equitable remedy available under applicable law.

Section 7.3. Waiver by Each Company. To the extent now or at any time hereafter enforceable under applicable law, each Company covenants that it will not at any time insist upon or plead, or in any manner whatsoever claim or take any benefit or advantage of, any stay or extension law now or at any time hereafter in force, nor claim, take nor insist upon any benefit or advantage of or from any law now or hereafter in force providing for the valuation or appraisement of the Collateral or any part thereof, prior to any sale or sales thereof to be made

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pursuant to any provision herein contained, or to the decree, judgment or order of any court of competent jurisdiction; nor, after such sale or sales, claim or exercise any right under any statute now or hereafter made or enacted by any state or otherwise to redeem the property so sold or any part thereof, and hereby expressly waives for itself and on behalf of each and every Person, except decree or judgment creditors of such Company acquiring any interest in or title to the Collateral relating to such Company or any part thereof subsequent to the date of this Agreement, all benefit and advantage of any such law or laws, and covenants that it will not invoke or utilize any such law or laws or otherwise hinder, delay or impede the execution of any power herein granted and delegated to the Security Trustee, but will suffer and permit the execution of every such power as though no such law or laws had been made or enacted.

Section 7.4. Effect of Sale. Any sale, whether under any power of sale hereby given or by virtue of judicial proceedings, shall operate to divest all right, title, interest, claim and demand whatsoever, either at law or in equity, of any affected Company in and to the property sold and shall be a perpetual bar, both at law and in equity, against such Company, its successors and assigns, and against any and all persons claiming the property sold or any part thereof under, by or through such Company, its successors or assigns.

Section 7.5. Application of Sale and Other Proceeds. The Security Trustee shall give at least one day prior written notice to each holder of a Note then outstanding of each date (the “Application Date”) on which the proceeds and/or avails of any sale of the Collateral, or any part thereof, shall be applied, and on such Application Date, or as soon thereafter as may be practical, the proceeds and the avails of any remedy hereunder then available to the Security Trustee shall be irrevocably paid to and applied as follows:

First, to the payment of costs and expenses of foreclosure or suit, if any, and of such sale, and of all proper expenses, liability and advances, including reasonable legal and administrative expenses and attorneys’ fees, incurred or made hereunder by the Security Trustee and of all taxes, assessments or Liens superior to the lien of these presents, except any taxes, assessments or other superior lien subject to which said sale may have been made;

Second, to the irrevocable payment of the whole amount then due upon the Senior Notes, whether by acceleration or otherwise, for principal, interest and premium, if any; and in case such proceeds shall be insufficient to pay in full the whole amount so due, owing or unpaid upon the Senior Notes, then ratably according to the aggregate of such principal and the accrued and unpaid interest and premium, if any, with application on each Senior Note to be made, first, to unpaid interest thereon, second, to the unpaid principal thereof, and third, to unpaid premium (including, but not limited to, any Make-Whole Amount and any other amounts due and owing pursuant to Section 2.10 of the Revolving Credit Agreement), if any, thereon; such application to be made upon presentation of the several Senior Notes, and the notation thereon of the payment, if partially paid, or the surrender and cancellation thereof, if fully paid;

Third, on a pro rata basis without any order of priority, to the irrevocable payment of (i) the amounts payable by World under the Revolving Credit Agreement in the form

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of fees pursuant to Sections 3.1 and 3.3 thereof as such sections were in effect on the Closing Date or as amended or revised after the Closing Date but not in excess of the aggregate amount of the fees payable pursuant to Sections 3.1 and 3.3 as in effect on the Closing Date, (ii) the amounts payable under the Revolving Credit Agreement for increased costs, taxes and indemnification as described in Section 10.3, Section 12.3 and paragraph (b) of Section 12.12, respectively, of the Revolving Credit Agreement, (iii) the amounts payable by World under the Senior Note Agreements pursuant to the final paragraph of Section 8.4 of the Senior Note Agreements and §8.13 (in each case, except to the extent covered by clause first above), and (iv) the first $2,500,000 of all other costs, claims, expenses and fees (including trustee’s fees and attorneys’ fees) which become payable by World pursuant to or arising out of the Senior Note Agreements, the Revolving Credit Agreement or this Agreement, in each case, with respect to the Senior Notes;

Fourth, to the irrevocable payment of the whole amount then due upon the Senior Subordinated Notes, whether by acceleration or otherwise, for principal, interest and premium, if any; and in case such proceeds shall be insufficient to pay in full the whole amount so due, owing or unpaid upon the Senior Subordinated Notes, then ratably according to the aggregate of such principal and the accrued and unpaid interest and premium, if any, with application on each Senior Subordinated Note to be made, first, to unpaid interest thereon, second, to the unpaid principal thereof, and third, to unpaid premium, if any, thereon; such application to be made upon presentation of the several Senior Subordinated Notes, and the notation thereon of the payment, if partially paid, or the surrender and cancellation thereof, if fully paid;

Fifth, to the irrevocable payment of any other Secured Indebtedness, including, without limitation, (i) all other expenses, fees and amounts owing to the holder of any Senior Note and not covered by the immediately preceding clauses first through fourth and (ii) all expenses, fees and other amounts owing to the holder of any Senior Subordinated Note; and

Sixth, to the irrevocable payment of the surplus, if any, to any affected Company, its successors and assigns, or to whomsoever may be lawfully entitled to receive the same.

The proceeds and/or avails of the Collateral shall be applied as set forth above notwithstanding the time or order of advance of any funds secured by any such Collateral or any other priority provided by law or otherwise. By accepting the benefits of this Agreement, each of the holders of the Notes agrees that it will not initiate or prosecute, or encourage any other person to initiate or prosecute, any claim, action or other proceeding challenging the enforceability of the claims of the holders of the Notes or challenging the enforceability of any liens or security interests in assets securing the Notes and the other obligations and liabilities relating thereto, in each case, created or incurred in accordance with the terms of this Agreement and the World Security Agreement.

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Section 7.6. Discontinuance of Remedies. In case the Security Trustee shall have proceeded to enforce any right under this Agreement by foreclosure, sale, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason or shall have been determined adversely, then and in every such case the Companies, the Security Trustee and the holders of the Notes shall be restored to their former positions and rights hereunder with respect to the property subject to the lien and security interest created under this Agreement.

Section 7.7. Cumulative Remedies. No delay or omission of the Security Trustee or of the holder of any Note to exercise any right or power arising from any default, shall exhaust or impair any such right or power or prevent its exercise during the continuance of such default. No waiver by the Security Trustee or the holder of any Note of any such default, whether such waiver be full or partial, shall extend to or be taken to affect any subsequent default, or to impair the rights resulting therefrom except as may be otherwise provided therein. No remedy hereunder is intended to be exclusive of any other remedy but each and every remedy shall be cumulative and in addition to any and every other remedy given hereunder or otherwise existing; nor shall the giving, taking or enforcement of any other or additional security, collateral or guaranty for the payment of the Secured Indebtedness operate to prejudice, waive or affect the security of this Agreement or any rights, powers or remedies hereunder, nor shall the Security Trustee or the holder of any Note be required to first look to, enforce or exhaust such other or additional security, collateral or guaranties.

SECTION 8. THE SECURITY TRUSTEE.

The Security Trustee accepts the trusts hereunder and agrees to perform the same, but only upon the terms and conditions hereof, including the following, to all of which each Company and the respective holders of the Notes at any time outstanding by their acceptance thereof agree:

Section 8.1. Duties of Security Trustee. (a) The Security Trustee undertakes (i) except while an Event of Default actually known to the Security Trustee shall have occurred and be continuing, to perform such duties and only such duties as are specifically set forth in this Agreement, or in any direction given pursuant to this Agreement, and (ii) while an Event of Default actually known to the Security Trustee shall have occurred and be continuing, (A) to exercise such of the rights and powers as are vested in it by this Agreement and subject to §8.1(b), to use the same degree of care and skill in their exercise as an ordinary prudent man would exercise or use under the circumstances in the conduct of his own affairs and (B) to conduct any sale or disposition of the Collateral pursuant to §7.2 in a commercially reasonable manner.

The Security Trustee upon receipt of instruments or notices furnished to the Security Trustee pursuant to the provisions of this Agreement shall furnish copies of the same to the holders of the Notes.

(b) In the event that the Security Trustee shall have actual knowledge of an Event of Default, the Security Trustee shall give prompt written notice of such Event of Default to each holder of a Note. Subject to the terms of §8.2(h), in accordance with written instructions

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received from the holders of at least a majority of the Aggregate Principal Amount of the Outstanding Notes, the Security Trustee shall take such action or refrain from taking such action as the Security Trustee shall be directed in writing by such holders. If the Security Trustee shall not have received written instructions as above provided within twenty (20) days after mailing notice of such Event of Default to the holders, the Security Trustee may, subject to instructions received pursuant to the preceding sentence, take such action, or refrain from taking such action, but shall be under no duty to take or refrain from taking any action, with respect to such Event of Default, as it shall determine advisable in the best interests of the holders of the Notes.

(c) The Security Trustee shall not have any duty or obligation to manage, control, use, sell, dispose of or otherwise deal with the Collateral, or, to otherwise take or refrain from taking any action under, or in connection with, this Agreement, except as expressly provided by the terms of this Agreement or expressly provided in written instructions received pursuant to this Agreement.

(d) Except if it is herein otherwise expressly provided that no such request is required, the Security Trustee shall not be under any obligation to take any action which is discretionary with the Security Trustee or otherwise requires judgment to be made by the Security Trustee under the provisions hereof, except on written request by the holders of the Notes or by the requisite portion thereof as expressly provided herein.

Section 8.2. Security Trustee’s Liability. No provision of this Agreement (except to the extent provided in §8.13 hereof) shall be construed to relieve the Security Trustee from liability for its own negligent action, negligent failure to act, or its own willful misconduct, except that:

(a) unless an Event of Default actually known to the Security Trustee shall have occurred and be continuing, the Security Trustee shall not be liable except for the performance of such duties as are specifically set forth in this Agreement and no implied covenants or obligations shall be read into this Agreement against the Security Trustee but the duties and obligations of the Security Trustee shall be determined solely by the express provisions of this Agreement; and

(b) in the absence of bad faith on the part of the Security Trustee, the Security Trustee may rely upon the authenticity of, and the truth of the statements and the correctness of the opinions expressed in, and shall be protected in acting upon, any resolution, officer’s certificate, opinion of counsel (which counsel shall be independent of the Companies, any Affiliate thereof and the holders of the Notes), Note, request, notice, consent, waiver, order, signature guaranty, notarial seal, stamp, acknowledgment, verification, appraisal, report, stock certificate, or other paper or document believed by the Security Trustee to be genuine and to have been signed, affixed or presented by the proper party or parties; and

(c) in the absence of bad faith on the part of the Security Trustee, whenever the Security Trustee, or any of its agents, representatives, experts or counsel (which counsel shall be independent of the Companies, any Affiliate thereof and the holders of the Notes), shall consider it necessary or desirable that any matter be proved or

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established, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by an officer’s certificate; provided, however, that the Security Trustee, or such agent, representative, expert or counsel, may require such further and additional evidence and make such further investigation as it or they may consider reasonable; and

(d) the Security Trustee may consult with counsel (which counsel shall be independent of the Companies, any Affiliate thereof and the holders of the Notes) and the advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered hereunder in good faith and in accordance with such advice or opinion of counsel; and

(e) the Security Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with any direction or request of the holders of Notes or the requisite portion thereof as expressly provided herein; and

(f) the Security Trustee shall not be liable for any error of judgment made in good faith by an officer of the Security Trustee unless it shall be proved that the Security Trustee was negligent in ascertaining the pertinent facts; and

(g) the Security Trustee shall not be deemed to have knowledge of any Default or Event of Default unless and until an officer of the Corporate Trust Department of the Security Trustee who customarily handles corporate trusts or such other Person employed by the Security Trustee who has primary responsibility for the transactions contemplated hereby shall have actual knowledge thereof or the Security Trustee shall have received written advice thereof from the holder of any Note; and

(h) whether or not an Event of Default shall have occurred, the Security Trustee shall not be under any obligation to take or refrain from taking any action under this Agreement which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it by the security afforded to it by the terms of this Agreement, unless and until it is requested in writing so to do by one or more holders of Notes outstanding hereunder and furnished, from time to time as it may require, with reasonable security and indemnity.

Section 8.3. No Responsibility of Security Trustee for Recitals. The recitals and statements contained herein and in the Notes shall be taken as the recitals and statements of the Companies, and the Security Trustee assumes no responsibility for the correctness of the same, nor shall the Security Trustee have any responsibility for or any liability with respect to any disclosure, warranty, representation or concealment or failure to disclose in connection with the offering, solicitation, sale or distribution of the Notes by the Companies or by any other Person.

The Security Trustee makes no representation as to the validity or sufficiency of this Agreement, or of the Notes secured hereby, the security hereby or thereby afforded, the title of the Companies to or the existence of the Collateral or the descriptions thereof, or the filing or recording or registering of this Agreement or any other document.

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The Security Trustee shall not be concerned with or accountable to any Person for the use or application of any deposited moneys which shall be released or withdrawn in accordance with the provisions of this Agreement or of any property or Securities or the proceeds thereof which shall be released from the lien and security interest hereof in accordance with the provisions of this Agreement.

Section 8.4. Certain Limitations on Security Trustee’s Rights to Compensation and Indemnification. Except to the extent otherwise expressly provided herein the Security Trustee shall have no right against the holder of any Note for the payment of compensation for its services hereunder or any expenses or disbursements incurred in connection with the exercise and performance of its powers and duties hereunder or any indemnification against liabilities which it may incur in the exercise and performance of such powers and duties but on the contrary, shall look solely to the Companies for such payment and indemnification which each Company hereby agrees to make, and the Security Trustee shall have no lien on or security interest in the Collateral as security for such compensation, expenses, disbursements and indemnification except to the extent provided for in §7.5.

Section 8.5. Status of Moneys Received. (a) All moneys received by the Security Trustee shall, together with any interest thereon, until used or applied as herein provided, be held in trust for the purposes for which they were received, but (except as herein otherwise provided with respect to the funds referred to in paragraph (b) of this Section) need not be segregated in any manner from any other moneys, except to the extent required by law, and may be deposited by the Security Trustee under such general conditions as may be prescribed by law in the Security Trustee’s general banking department, and the Security Trustee shall be under no liability for interest (other than any interest accrued pursuant to clause (b) of this §8.5) on any moneys received by it hereunder.

(b) The Security Trustee shall invest and reinvest any funds from time to time held by the Security Trustee in direct obligations of the United States of America or obligations for which the full faith and credit of the United States is pledged to provide for the payment of principal and interest, maturing not more than 90 days from the date of such investment.

Section 8.6. Resignation of Security Trustee. The Security Trustee may resign without cause and be discharged from the trusts created hereby by delivering notice thereof, by registered or certified mail postage prepaid to each Company and all holders of the Notes at the time outstanding. Such resignation shall take effect immediately upon the appointment of a successor Security Trustee as provided in §§8.8 and 8.9.

Section 8.7. Removal of Security Trustee. The Security Trustee may be removed at any time, for or without cause, by an instrument or instruments in writing executed by the holders of a majority of the Aggregate Principal Amount of the Outstanding Notes and delivered to the Security Trustee with a copy to each Company, specifying the removal and the date when it shall take effect; provided, however, that no such removal shall be effective hereunder unless and until a successor security trustee shall have been appointed and shall have accepted such appointment as provided in §§8.8 and 8.9.

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Section 8.8. Appointment of Successor Security Trustee. In case at any time the Security Trustee shall resign or be removed or become incapable of acting, a successor Security Trustee may be appointed by the holders of a majority of the Aggregate Principal Amount of the Outstanding Notes, by an instrument or instruments in writing executed by such Noteholders and filed with such successor Security Trustee and each Company.

Until a successor Security Trustee shall be so appointed by the Noteholders, the Companies shall appoint a successor Security Trustee to fill such vacancy, by an instrument in writing executed by the Companies and delivered to the successor Security Trustee. If all or substantially all of the Collateral shall be in the possession of one or more receivers, trustees, liquidators or assignees for the benefit of creditors, then such receivers, trustees, custodians, liquidators or assignees may, by an instrument in writing delivered to the successor Security Trustee, appoint a successor Security Trustee. Promptly after any such appointment, the Companies, or any such receivers, trustees, custodians, liquidators or assignees, as the case may be, shall give notice thereof by first class mail postage prepaid to each holder of the Notes at the time outstanding.

Any successor Security Trustee so appointed by the Companies, or such receivers, trustees, custodians, liquidators or assignees, shall immediately and without further act be superseded by a successor Security Trustee appointed by the holders of a majority in Aggregate Principal Amount of the Outstanding Notes.

If a successor Security Trustee shall not be appointed pursuant to this Section within thirty days after notice of the resignation or removal of the retiring Security Trustee, the holder of any Note or such retiring Security Trustee (unless the retiring Security Trustee is being removed) may apply to any court of competent jurisdiction to appoint a successor Security Trustee, and such court may thereupon, after such notice, if any, as it may consider proper, appoint a successor Security Trustee.

Section 8.9. Succession of Successor Security Trustee. Any successor Security Trustee appointed hereunder shall execute, acknowledge and deliver to each Company and the predecessor Security Trustee an instrument accepting such appointment, and thereupon such successor Security Trustee, without any further act, deed, conveyance or transfer, shall become vested with the title to the Collateral, and with all the rights, powers, trusts, duties and obligations of the predecessor Security Trustee in the trust hereunder, with like effect as if originally named as Security Trustee herein.

Upon the request of any such successor Security Trustee, however, each Company and the predecessor Security Trustee shall execute and deliver such instruments of conveyance and further assurance and do such other things as may reasonably be required for more fully and certainly vesting and confirming in such successor Security Trustee its interest in the Collateral and all such rights, powers, trusts, duties and obligations of the predecessor Security Trustee hereunder, and the predecessor Security Trustee shall also assign and deliver to the successor Security Trustee any property subject to the lien and security interest of this Agreement which may then be in its possession.

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Section 8.10. Eligibility of Security Trustee. The Security Trustee shall be a state or national bank or trust company in good standing, organized under the laws of the United States of America or of any state thereof, having a capital, surplus and undivided profits aggregating at least $500,000,000 and whose certificates of deposit are accorded a rating of A or better by S&P and Moody’s or, if S&P and Moody’s are no longer rating such banks, then by any other nationally recognized credit rating agency of similar standing or a guaranty of its obligations hereunder from such a bank or trust company or holding company in good standing, organized under the laws of the United States of America or of any State thereof, having a capital, surplus and undivided profits aggregating at least $500,000,000 and whose certificates of deposit are accorded a rating of A or better by S&P and Moody’s or, if S&P and Moody’s are no longer rating such banks, then by any other nationally recognized credit rating agency of similar standing, if there be such a bank or trust company willing and able to accept such trust upon reasonable and customary terms.

In case the Security Trustee shall cease to be eligible in accordance with the provisions of this Section, the Security Trustee shall resign immediately in the manner and with the effect specified in §8.6.

Section 8.11. Successor Security Trustee by Merger. Any corporation into which the Security Trustee may be merged or with which it may be consolidated, or any corporation resulting from any merger or consolidation to which the Security Trustee shall be a party, or any state or national bank or trust company in any manner succeeding to the corporate trust business of the Security Trustee as a whole or substantially as a whole, if eligible as provided in §8.10, shall be the successor of the Security Trustee hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything to the contrary contained herein notwithstanding.

Section 8.12. Co-Trustees. At any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Collateral may at the time be located, the Companies and the Security Trustee jointly shall have power and shall execute and deliver all instruments, to appoint one or more persons approved by the Security Trustee, to act as co-trustee, or co-trustees, jointly with the Security Trustee, or separate trustee or separate trustees, of all or any part of the Collateral, and to vest in such person or persons in such capacity, such interest in the Collateral or any part thereof, and such rights, powers, duties, trusts or obligations as the Companies and the Security Trustee may consider necessary or desirable. If the Companies shall not have joined in such appointment within 15 days after the receipt by it of a request so to do, or in case an Event of Default shall have occurred and be continuing, the Security Trustee alone shall have power to make such appointment if the Security Trustee reasonably believes such appointment is necessary or desirable to carry out the transactions contemplated hereby.

Section 8.13. Compensation and Reimbursement. Each Company agrees:

(a) to pay to the Security Trustee all of its out-of-pocket expenses in connection with the preparation, execution and delivery of this Agreement and the

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transactions contemplated hereby, including but not limited to the reasonable charges and disbursements of its special counsel;

(b) to pay to the Security Trustee from time to time reasonable compensation for all services rendered by it hereunder;

(c) except as otherwise expressly provided herein, to reimburse the Security Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Security Trustee in accordance with any provision of this Agreement (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its gross negligence or willful misconduct; and

(d) to indemnify the Security Trustee for, and to hold it harmless against, any loss, liability or expense incurred without gross negligence or willful misconduct on its part, arising out of or in connection with the acceptance or administration of the Agreement, including, but not limited to, the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder, and any loss, liability, expense or claim arising out of its possession, management, control, use or operation of the Collateral.

SECTION 9. SUPPLEMENTS; WAIVERS.

Section 9.1. Supplemental Security Agreements Without Noteholder Consent. The Companies and the Security Trustee from time to time and at any time, subject to the restrictions in this Agreement contained, may enter into an agreement or agreements supplemental hereto, which thereafter shall form a part hereof, for any one or more or all of the following purposes:

(a) to add to the covenants and agreements to be observed by, and to surrender any right or power reserved to or conferred upon the Companies;

(b) to subject to the lien and security interest of this Agreement additional property hereafter acquired by any Company and intended to be subjected to the lien and security interest of this Agreement and to correct and amplify the description of any property subject to the lien and security interest of this Agreement;

(c) to permit the qualification of this Agreement under the Trust Indenture Act of 1939, as amended, or any similar Federal statute hereafter in effect, except that nothing herein contained shall permit or authorize the inclusion of the provisions referred to in Section 316(a)(2) of said Trust Indenture Act of 1939 or any corresponding provision in any similar Federal statute hereafter in effect; and

(d) to enter into a Security Agreement Supplement in the form attached hereto as Exhibit A;

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and each Company covenants to perform all requirements of any such supplemental agreement. No restriction or obligation imposed upon any Company may, except as otherwise provided in this Agreement, be waived or modified by any such supplemental agreement.

Section 9.2. Waivers and Consents by Noteholders; Supplemental Security Agreements with Noteholders’ Consent. (a) Upon the waiver or consent of (x) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Secured Notes, (y) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Revolving Credit Notes, and, if any of the waivers or supplemental agreements described below relate to Collateral involving assets of World and its Restricted Subsidiaries which constitute a “substantial part” (as defined below), (z) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes, the Companies and the Security Trustee may enter into an agreement or agreements supplemental hereto for the purpose of waiving, adding, changing or eliminating any provisions of this Agreement or of any agreement supplemental hereto or modifying in any manner the rights and obligations of the holders of the Notes and the Companies; provided, however, that no such waiver or supplemental agreement shall (A) impair or affect the right of any holder to receive payments or prepayments of the principal of and payments of the interest and premium, if any, on its Note, as therein and herein provided, without the consent of such holder, (B) permit the creation of any lien and security interest with respect to any of the Collateral, without the consent of the holders of all the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of World and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding, (C) except as otherwise provided in §10.4, effect the deprivation of the holder of any Note of the benefit of the lien and security interest of this Agreement upon all or any part of the Collateral without the consent of the holders of all of the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of World and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding, (D) reduce the aforesaid percentages of the aggregate principal amount of Notes, the holders of which are required to consent to any such waiver or supplemental indenture pursuant to this Section, without the consent of the holders of all of the Notes at the time outstanding (including, without limitation, any change to the definition of “Aggregate Principal Amount of the Outstanding Notes”), (E) modify the rights, duties or immunities of the Security Trustee without the consent of the Security Trustee and the holders of all of the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of World and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding, or (F) except as otherwise provided in §10.4 hereof, consent to the release or termination of any Subsidiary Guaranty Agreement without the consent of the holders of all of the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of World and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding.

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(b) For purposes of this §9.2, assets subject to any waiver or supplemental agreement shall be deemed to be a “substantial part” of the assets of World and its Restricted Subsidiaries if (i) such assets, together with all other assets (A) sold, leased or otherwise disposed of by World and its Restricted Subsidiaries or (B) subject to any waiver or supplemental agreement pursuant to this §9.2 or Section 9.2 of the World Security Agreement without the consent of the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes or, if such waiver or supplemental agreement is described in clauses (B), (C), (E) or (F) of §9.2(a) or Section 9.2(a) of the World Security Agreement, without the consent of all of the holders of the Senior Subordinated Notes, in each case, during the period of 12 months ending with the date of such waiver or supplemental agreement, contributed more than 15% of EBIT of World and its Restricted Subsidiaries determined as of the end of the fiscal year immediately preceding such waiver or supplemental agreement, (ii) the book value of such assets, when added to the book value of all other assets of World and its Restricted Subsidiaries (A) sold or otherwise disposed of by World and its Restricted Subsidiaries or (B) subject to any waiver or supplemental agreement pursuant to this §9.2 or Section 9.2 of the World Security Agreement without the consent of the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes or, if such waiver or supplemental agreement is described in clauses (B), (C), (E) or (F) of §9.2(a) or Section 9.2(a) of the World Security Agreement, without the consent of all of the holders of the Senior Subordinated Notes, in each case, during the period of 12 months ending with the date of such waiver or supplemental agreement, exceeds 10% of the book value of all Receivables of World and its Restricted Subsidiaries determined on a consolidated basis as of the end of the fiscal year immediately preceding such waiver or supplemental agreement, or (iii) the book value of such assets, when added to the book value of all other assets of World and its Restricted Subsidiaries (A) sold or otherwise disposed of by World and its Restricted Subsidiaries or (B) subject to any waiver or supplemental agreement pursuant to this §9.2 or Section 9.2 of the World Security Agreement without the consent of the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes or, if such waiver or supplemental agreement is described in clauses (B), (C), (E) or (F) of §9.2(a) or Section 9.2(a) of the World Security Agreement, without the consent of all of the holders of the Senior Subordinated Notes, in each case, during the entire period commencing on April 1, 1997 and ending with the date of such waiver or supplemental agreement, exceeds 25% of the book value of all Receivables of World and its Restricted Subsidiaries determined on a consolidated basis as of the end of the fiscal year immediately preceding such waiver or supplemental agreement.

Section 9.3. Notice of Supplements. Promptly after the execution by the Companies and the Security Trustee of any supplemental agreement pursuant to the provisions of §9.1 or §9.2, the Companies shall deliver a conformed copy thereof, mailed first-class postage prepaid, to each holder of the Notes at its address set forth in the Note Register. Any failure of the Companies to give such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental agreement.

Section 9.4. Opinion of Counsel Conclusive as to Supplements. The Security Trustee is hereby authorized to join with the Companies in the execution of any such supplemental

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

indenture or agreement authorized or permitted by the terms of this Agreement and to make the further agreements and stipulations which may be therein contained, and the Security Trustee may receive an opinion of independent counsel selected by the Security Trustee as conclusive evidence that any supplemental agreement executed pursuant to the provisions of this §9 complies with the requirements of this §9.

SECTION 10. MISCELLANEOUS.

Section 10.1. Successors and Assigns. Whenever any of the parties hereto is referred to such reference shall be deemed to include the successors and assigns of such party; and all the covenants, promises and agreements in this Agreement contained by or on behalf of each Company or by or on behalf of the Security Trustee shall bind and inure to the benefit of the respective successors and assigns of such parties whether so expressed or not.

Section 10.2. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 10.3. Communications. All communications provided for herein shall be in writing. Communications to the Companies or the Security Trustee shall be deemed to have been given (unless otherwise required by the specific provisions hereof in respect of any matter) when addressed and delivered in person, or five days after being deposited in the U.S. mail, postage prepaid, by registered or certified mail or by overnight express mail, as follows:

If to the Companies:
	c/o World Acceptance Corporation
	108 Frederick Street
	Greenville, South Carolina 29607-2532
	Attention: Chief Financial Officer
If to the Security Trustee:
	Harris Trust and Savings Bank
	311 West Monroe, 12th Floor
	Chicago, Illinois 60606
	Attention:	Robert Foltz
		Indenture Trust Division

or to such Company or the Security Trustee at such other address as such Company or the Security Trustee may designate by notice duly given in accordance with this Section to the other. Communications to the holder of a Note shall be deemed to have been given (unless otherwise provided for by the specific provisions hereof in respect of any matter) when delivered personally

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

or five days after being deposited in the U.S. mail, postage prepaid by registered or certified mail or by overnight express mail, addressed to such holder at its address set forth in the Note Register in the case of any holder of the Senior Secured Notes or the Senior Subordinated Notes and at its address set forth in the Revolving Credit Agreement in the case of any holder of the Revolving Credit Notes.

Section 10.4. Release. The Security Trustee shall release fully or partially, as the case may be, the Lien granted by this Agreement under and only under the following circumstances:

(a) Upon the presentation of satisfactory evidence that all Secured Indebtedness has been irrevocably fully paid or discharged and all obligations of the holders of Notes to extend Secured Indebtedness to World have terminated or otherwise expired, the Security Trustee shall release the Lien and security interest of this Agreement by proper instrument or instruments;

(b) So long as no Default or Event of Default then exists, upon the sale or other disposition of any assets of World and its Restricted Subsidiaries which the Chief Financial Officer of World certifies to the Security Trustee and the Noteholders in writing does not constitute a “substantial part” of the assets of World and its Restricted Subsidiaries (as defined in Section 5.13 of the Senior Note Agreements, Section 5.13 of the Senior Subordinated Note Agreement and Section 8.13 of the Revolving Credit Agreement), the Security Trustee shall, upon the written direction of World and without the consent of the Noteholders, release the Lien of this Agreement on such assets by proper instrument or instruments (unless the Security Trustee has been notified in writing by a Noteholder prior to such release that such Noteholder in good faith believes that the conditions set forth above have not been satisfied, in which case no such release shall be issued). If any such sale or other disposition of assets constituting less than a “substantial part” of the assets of World and its Restricted Subsidiaries pursuant to this §10.4(b) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreements with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as World may deem necessary or proper to carry out more effectively the foregoing;

(c) Upon the sale or other disposition by World of a “substantial part” of the assets of World and its Restricted Subsidiaries (as defined in Section 5.13 of the Senior Note Agreements, Section 5.13 of the Senior Subordinated Note Agreement and Section 8.13 of the Revolving Credit Agreement) after the occurrence and during the continuance of a Material Event of Default, the Security Trustee shall, upon the written direction of World and the written consent of (x) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Secured Notes, and (y) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Revolving Credit Notes, and without the further consent of the holders of the Senior Subordinated Notes, release the Lien of this Agreement on such assets by proper instrument or instruments,

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

provided, that, (i) such sale or other disposition is not to an Affiliate, (ii) the sale price for such assets is determined by World in good faith to be reasonable, as evidenced by a resolution of the board of directors of World, (iii) the proceeds of any such sale or other disposition are applied to the satisfaction of Secured Indebtedness and, if such application results in the prepayment of any obligations under the Revolving Credit Agreement, such application permanently reduces the amount of the commitment under the Revolving Credit Agreement, (iv) each Noteholder shall have received written notice of such sale or other disposition at least ten days prior to the date of such sale or other disposition and (v) the Security Trustee and the Noteholders receive a certificate of the Chief Financial Officer of World certifying to each of the foregoing. If any such sale or other disposition of assets of World and its Restricted Subsidiaries pursuant to this §10.4(c) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreements with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as World may deem necessary or proper to carry out more effectively the foregoing;

(d) Upon the sale or other disposition of the Collateral or any part thereof pursuant to and in accordance with §7.2 and conducted in a commercially reasonable manner, the Security Trustee shall release the Lien of this Agreement on the Collateral or such part, as the case may be, by proper instrument or instruments; and

(e) With the prior written consent of each Noteholder, the Security Trustee shall release the Lien of this Agreement by proper instrument or instruments.

Section 10.5. Counterparts. This Agreement may be executed, acknowledged and delivered in any number of counterparts, each of such counterparts constituting an original but all together only one Agreement.

Section 10.6. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of South Carolina.

Section 10.7. Headings. Any headings or captions preceding the text of the several sections hereof are intended solely for convenience of reference and shall not constitute a part of this Agreement nor shall they affect its meaning, construction or effect.

Section 10.8. Prior Liens. Upon the execution and delivery of this Agreement by the Companies and the Security Trustee, this Agreement shall supersede all provisions of the Original Subsidiary Security Agreements and Additional Subsidiary Security Agreements as of the date of such execution and delivery. The Companies hereby agree that, notwithstanding the execution and delivery of this Agreement, the liens and security interests created and provided for under the Original Subsidiary Security Agreements and Additional Subsidiary Security Agreements continue in effect under and pursuant to the terms of this Agreement for the benefit of all of the Secured Indebtedness. Nothing herein shall in any manner affect or impair the priority of the liens and security interests created and provided for by the Original Subsidiary

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

Security Agreements and Additional Subsidiary Security Agreements as to the indebtedness and obligations which would otherwise be secured thereby prior to giving effect to this Agreement.

Section 10.9. Rights of Holders of Senior Subordinated Notes. The rights and remedies under this Agreement of the holders of the Senior Subordinated Notes are junior and subordinate to the rights and remedies of the holders of the Senior Notes pursuant to the terms of the Senior Subordinated Note Agreement, reference to Section 9 of which is hereby made for a statement of the terms and conditions thereof.

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

IN WITNESS WHEREOF, each Company has caused this Agreement to be executed, and the Security Trustee in evidence of its acceptance of the trusts hereby created, has caused this Agreement to be executed on its behalf.

WORLD ACCEPTANCE CORPORATION OF
ALABAMA
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD ACCEPTANCE CORPORATION OF
MISSOURI
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD FINANCE CORPORATION OF GEORGIA
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD FINANCE CORPORATION OF LOUISIANA
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD ACCEPTANCE CORPORATION OF
OKLAHOMA, INC.
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

WORLD FINANCE CORPORATION OF SOUTH
CAROLINA
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD FINANCE CORPORATION OF
TENNESSEE
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WFC LIMITED PARTNERSHIP
	By	WFC of South Carolina, Inc.,
		as sole general partner
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WFC OF SOUTH CAROLINA, INC.
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD FINANCE CORPORATION OF ILLINOIS
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

WORLD FINANCE CORPORATION OF NEW
MEXICO
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
WORLD FINANCE CORPORATION OF TEXAS
By	/s/    TOMMY E. MARR
Its	President
HARRIS TRUST AND SAVINGS BANK, as
Security Trustee
By	/s/    ROBERT D. FOLTZ
Its	Vice President

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Amended and Restated Security Agreement,

Pledge and Indenture of Trust (Subsidiaries)

NOTEHOLDERS CONSENT

The undersigned Noteholders hereby consent to the execution and delivery of this Agreement by the Companies and the Security Trustee.

HARRIS TRUST AND SAVINGS BANK, as a
Noteholder
By	/s/    JEROME P. CROKIN
Its	Vice President
THE FIRST NATIONAL BANK OF CHICAGO, as a
Noteholder
By	/s/    CRAIG GOLDSMITH
Its	Assistant Vice President
LASALLE NATIONAL BANK, as a Noteholder
By	/s/    BEN SCHREINER
Its	Loan Officer
PRINCIPAL MUTUAL LIFE INSURANCE
COMPANY, as a Noteholder
By	/s/    JAMES C. FIFIELD
Its	Counsel
By	/s/    KENT T. KELSEY
Its	Counsel
JEFFERSON-PILOT LIFE INSURANCE COMPANY,
as a Noteholder
By	/s/    H. LUSBY BROWN
Its	Second Vice President

-44-

PLEDGED SECURITIES

ISSUER DESCRIPTION OF PLEDGED SECURITIES

SCHEDULE I

(to Amended and Restated Security Agreement,

Pledge and Indenture of Trust)

PARTNERSHIP INTERESTS

SCHEDULE II

(to Amended and Restated Security Agreement,

Pledge and Indenture of Trust)

LOCATION OF OFFICES

WORLD ACCEPTANCE CORPORATION OF ALABAMA:

WORLD ACCEPTANCE CORPORATION OF MISSOURI:

WORLD FINANCE CORPORATION OF GEORGIA:

WORLD FINANCE CORPORATION OF LOUISIANA:

WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC.:

WORLD FINANCE CORPORATION OF SOUTH CAROLINA:

WORLD FINANCE CORPORATION OF TENNESSEE:

WORLD FINANCE CORPORATION OF TEXAS:

WFC LIMITED PARTNERSHIP:

WFC OF SOUTH CAROLINA, INC.:

WORLD FINANCE CORPORATION OF ILLINOIS:

WORLD FINANCE CORPORATION OF NEW MEXICO:

SCHEDULE III

(to Amended and Restated Security Agreement,

Pledge and Indenture of Trust)

LIST OF NAMES UNDER WHICH EACH COMPANY DOES BUSINESS

SCHEDULE IV

(to Amended and Restated Security Agreement,

Pledge and Indenture of Trust)

SECURITY AGREEMENT SUPPLEMENT             

SECURITY AGREEMENT SUPPLEMENT             , dated             , 19__, between             (the “Company”), and Harris Trust and Savings Bank, as security trustee (the “Security Trustee”) under the Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 among World Acceptance Corporation of Alabama, an Alabama corporation, World Acceptance Corporation of Missouri, a Missouri corporation, World Finance Corporation of Georgia, a Georgia corporation, World Finance Corporation of Louisiana, a Louisiana corporation, World Acceptance Corporation of Oklahoma, Inc., an Oklahoma corporation, World Finance Corporation of South Carolina, a South Carolina corporation, World Finance Corporation of Tennessee, a Tennessee corporation, World Finance Corporation of Texas, a Texas corporation, WFC Limited Partnership, a Texas limited partnership, WFC of South Carolina, Inc., a South Carolina corporation, World Finance Corporation of Illinois, an Illinois corporation, World Finance Corporation of New Mexico, a New Mexico corporation, each other Restricted Subsidiary which has previously executed a Security Agreement Supplement and the Security Trustee (the “Security Agreement”). All capitalized terms used herein and not otherwise defined herein shall have the meanings forth in the Security Agreement.

WITNESSETH:

WHEREAS, pursuant to Section 3.9 of the World Security Agreement, the Security Agreement provides for the execution and delivery from time to time of Security Agreement Supplements substantially in the form hereof each of which shall particularly describe the Collateral subject to the security interest of the Security Agreement;

NOW, THEREFORE, TO SECURE (i) the equal and pro rata payment of both the principal of and interest and premium, if any, on all Senior Notes at any time outstanding according to their tenor and effect, (ii) on a senior subordinated basis as set forth in the Security Agreement and in the Senior Subordinated Note Agreement, the equal and pro rata payment of both the principal of and interest and premium, if any, on all Senior Subordinated Notes at any time outstanding, according to their tenor and effect, and (iii) the payment of all other Secured Indebtedness and the performance and observance of all the covenants and conditions contained in the Notes, the Security Agreement, the World Security Agreement, the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement, and the Subsidiary Guaranty Agreements, in each case, subject to the terms thereof and of Section 7.5 of the Security Agreement, the Company does hereby mortgage, grant, convey, warrant, assign, pledge and hypothecate unto the Security Trustee, its successors in trust and assigns, forever, and grants to the Security Trustee, its successors in trust and assigns, forever, a continuing security interest in, all and singular the following described properties, rights, interests and privileges, together with the proceeds thereof, now or hereafter owned by the Company:

(a) All building materials, building equipment, machinery, apparatus, furniture and equipment and other personal property (other than motor vehicles and accessions to motor vehicles) of every kind and nature whatsoever located, including

without limitation: all air conditioning, ventilating, plumbing, heating, lighting and electrical systems and apparatus; all communications equipment and intercom systems and apparatus; all typewriters, computers and other office machines and equipment, furniture, furnishings; all sprinkler equipment and apparatus, all elevators and escalators; and all machinery, equipment, engines, boilers, tools, furniture, carpeting, tables and chairs, together with all accessories, parts and appurtenances appertaining or attached thereto, whether now owned or hereafter acquired, and all substitutions, renewals, or replacements of and additions, improvements, accessions and accumulations to any and all thereof, together with all the rents, income, revenues, issues, proceeds, profits and avails arising therefrom or in connection therewith and excluding, in all cases, any of the foregoing items of property which are deemed fixtures;

(b) Receivables, whether now existing or hereafter arising, and however evidenced or acquired, or in which the Company now has or hereafter acquires any rights and all rights of the Company to any Underlying Collateral granted by an Account Debtor in connection with any Receivable owing by it to the Company;

(c) The Pledged Collateral, if any, including the Pledged Shares, if any, described on Schedule I hereto;

(d) General intangibles of the Company, including, without limitation, tax refunds, rights with respect to trademarks, service marks, trade names, patents, copyrights, trade-secrets information and rights to prevent others from doing acts that constitute unfair competition with or misappropriation of property of the Company including, without limitation, any sums (net of expenses) that the Company may receive arising out of any claim for infringement of its rights in any patent, copyright, trademark, trade name, trade secret or other proprietary right and all rights of the Company under contracts to enjoy performance by others or to be entitled to enjoy rights granted by others, including, without limitation, any licenses (to the extent permitted by law);

(e) All Investment Property, whether now owned or existing or hereafter created, acquired or arising, or in which the Company now has or hereafter acquires any rights (the term “Investment Property” means and includes all investment property and any other securities (whether certificated or uncertificated), security entitlements, securities accounts, commodity contracts and commodity accounts, including all substitutions and additions thereto, all dividends, distributions and sums distributable or payable from, upon, or in respect of such property, and all rights privileges incident to such property, but excludes the Pledged Collateral);

(f) Supporting evidence and documents relating to any of the above-described property, including without limitation, written applications, credit information, account cards, payment records, correspondence, delivery and installation certificates, invoice copies, delivery receipts, notes and other evidences of indebtedness, insurance certificates and the like, together with all books of account, data processing records, computer software and licenses to use the same, ledgers and cabinets in which the same are reflected or maintained, all whether now existing or hereafter arising;

A-2

(g) (i) All right, title and interest of the Company, whether now owned or hereafter acquired, in all partnerships or limited liability companies, including, without limitation, those set forth on Schedule II hereto (collectively, the “Partnerships”), (ii) any and all payments or distributions of whatever kind or character and whether in cash or other property, at any time made, owing or payable to the Company in respect of or on account of its present or hereafter acquired interest in the Partnerships, whether due or to become due and whether representing profits, distributions pursuant to complete or partial liquidation or dissolution, repayment of capital contributions or otherwise, and the right to receive, receipt for, use and enjoy all such payments and distributions, and all proceeds thereof, in every case whether now arising or hereafter acquired or arising, and (iii) all proceeds of any of the foregoing;

(h) All property and rights, if any, which are by the express provisions of this Agreement required to be subjected to the lien hereof and any additional property and rights that may from time to time hereafter, by writing of any kind, be subjected to the lien hereof by the Company or by anyone acting at the direction or as an agent of the Company; and

(i) All proceeds and products of the foregoing and all insurance of the foregoing and proceeds thereof, whether now existing or hereafter arising.

TO HAVE AND TO HOLD the Collateral, WITH POWER OF SALE and right of entry and possession, unto the Security Trustee, its successors and assigns, forever; IN TRUST NEVERTHELESS, upon the terms and trust set forth in the Security Agreement, for the equal and proportionate benefit, security and protection of all present and future holders of the Senior Notes outstanding thereunder from and after the issuance of the Senior Notes, without preference, priority or distinction of any Senior Note over any other Senior Note by reason of series, priority of time of issue, sale, negotiation, time of any extension of credit evidenced thereby, date of maturity thereof or otherwise for any cause whatsoever and, on a senior subordinated basis as set forth in the Security Agreement and in the Senior Subordinated Note Agreement, for the equal and proportionate benefit, security and protection of all present and future holders of the Senior Subordinated Notes outstanding thereunder from and after the issuance of the Senior Subordinated Notes, without preference, priority or distinction of any Senior Subordinated Note over any other Senior Subordinated Note by reason of series, priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any cause whatsoever.

The Company hereby binds itself, its successors and assigns, to warrant and forever defend to the Security Trustee and its successors and assigns the security interest hereby created and granted.

The Company hereby agrees that it is a “Company” for all purposes of the Security Agreement and hereby (A) agrees to be bound by all of the terms of and perform all of the covenants contained in the Security Agreement and (B) makes all of the representations and warranties contained in the Security Agreement.

A-3

The Company hereby represents that the Collateral (other than the Underlying Collateral and the Pledged Collateral) relating to the Company and the books and records relating thereto are in the Company’s possession at the offices and facilities owned or leased by the Company or World set forth on Schedule III hereto.

This Supplement shall be construed as supplemental to the Security Agreement and shall form a part of it and the Security Agreement is hereby incorporated by reference herein and is hereby ratified, approved and confirmed.

This Supplement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument.

This Supplement shall in all respects be governed by, and construed in accordance with, the laws of the State of South Carolina, including all matters of construction, validity and performance.

A-4

IN WITNESS WHEREOF, the Company and the Security Trustee have caused this Supplement to be executed, as of the day and year first above written.

By

Its

COMPANY

HARRIS TRUST AND SAVINGS BANK, as

Security Trustee

By

Its

SECURITY TRUSTEE

A-5

DESCRIPTION OF PLEDGED COLLATERAL

SCHEDULE I

(to Security Agreement Supplement)

PARTNERSHIP INTERESTS

SCHEDULE II

(to Security Agreement Supplement)

LOCATIONS OF OFFICES AND FACILITIES

SCHEDULE III

(to Security Agreement Supplement)

FIRST AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as amended and supplemented, the “Subsidiary Security Agreement”), from World Acceptance Corporation of Alabama, World Acceptance Corporation of Missouri, World Finance Corporation of Georgia, World Finance Corporation of Louisiana, World Acceptance Corporation of Oklahoma, Inc., World Finance Corporation of South Carolina, World Finance Corporation of Tennessee, World Finance Corporation of Texas, WFC Limited Partnership, WFC of South Carolina, Inc., World Finance Corporation of Illinois, World Finance Corporation of New Mexico, World Finance Corporation of Kentucky, and WFC Services, Inc., (each individually a “Company” and collectively the “Companies”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Subsidiary Security Agreement.

The Companies and the Security Trustee, acting at the direction of the Noteholders, have agreed to amend the definition of “Receivables” as set forth in the Subsidiary Security Agreement to reflect changes in Article 9 of the Uniform Commercial Code, and this instrument shall constitute an agreement between the Companies and the Security Trustee amending the Subsidiary Security Agreement in the respects, but only in the respects, hereinafter set forth:

1. The definition of “Receivables” appearing in Section 1.1 of the Restricted Subsidiary Security Agreement shall be amended and restated in its entirety to read as follows:

“Receivables” shall mean all accounts receivable, receivables, contract rights, controls, instruments, notes, drafts, bills, acceptances, documents, chattel paper, general intangibles and all other forms of obligations owing to a Person, including, without limitation, all Accounts, Instruments (including Promissory Notes), Documents, Chattel Paper (including tangible and electronic Chattel Paper), Letter-of-Credit Rights, Supporting Obligations, General Intangibles (including Payments Intangibles), as defined in the Uniform Commercial Code as in effect in the State of South Carolina.

2. As collateral security for the indebtedness, obligations, and liabilities of the Companies set forth in Section 2 of the Subsidiary Security Agreement, the Companies hereby grant and reaffirm to the Security Trustee a continuing lien on and security interest in, and acknowledges and agrees that the Security Trustee has and shall continue to have a continuing lien on and security interest in, all of the Collateral described therein, including all Receivables as defined above whether now existing or hereafter arising or acquired. Neither the Company nor the Security Trustee intends by this Amendment to in any way impair or otherwise affect the lien of the Company Security Agreement on such of the Collateral which was subject to the Company Security Agreement prior to giving effect to this Amendment. Neither the Companies nor the

Security Trustee intends by this Amendment to in any way impair or otherwise affect the lien of the Subsidiary Security Agreement on such of the Collateral which was subject to the Subsidiary Security Agreement prior to giving effect to this Amendment.

3. The Companies hereby repeat and reaffirm all of its covenants, agreements, representations and warranties contained in the Subsidiary Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Subsidiary Security Agreement after giving effect to this Amendment. The Companies hereby certify that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Subsidiary Security Agreement after giving effect to this Amendment.

4. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Subsidiary Security Agreement, any reference in any of such to the Subsidiary Security Agreement to be deemed to reference to the Subsidiary Security Agreement as modified hereby.

5. Except as specifically modified hereby, all the terms and conditions of the Subsidiary Security Agreement shall stand and remain unchanged and in full force and effect.

[Signature Page to Follow]

- 2 -

PLEDGORS:

WORLD ACCEPTANCE CORPORATION OF ALABAMA

WORLD ACCEPTANCE CORPORATION OF MISSOURI

WORLD FINANCE CORPORATION OF GEORGIA

WORLD FINANCE CORPORATION OF LOUISIANA

WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC.

WORLD FINANCE CORPORATION OF SOUTH CAROLINA

WORLD FINANCE CORPORATION OF TENNESSEE

WFC OF SOUTH CAROLINA, INC.

WORLD FINANCE CORPORATION OF ILLINOIS

WORLD FINANCE CORPORATION OF NEW MEXICO

WORLD FINANCE CORPORATION OF KENTUCKY

WFC SERVICES, INC.

By
	A. Alexander McLean III
Its	Executive Vice President

WFC LIMITED PARTNERSHIP
By	WFC of South Carolina, Inc., as sole general partner
	By
		A. Alexander McLean III
	Its	Executive Vice President

WORLD FINANCE CORPORATION OF TEXAS
By
	Charles F. Gardner, Jr.
Its	President

- 3 -

Acknowledged and agreed to as of the date first above written.

HARRIS TRUST AND SAVINGS BANK, as

Security Trustee

By

Name

Title

- 4 -

NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Subsidiary Security Agreement, the undersigned Noteholders hereby consent to the First Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

HARRIS TRUST AND SAVINGS BANK

By

Its

BANK ONE, NA

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

PRINCIPAL LIFE INSURANCE COMPANY

By

Its     

By

Its     

- 2 -

SECOND AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Subsidiary Security Agreement”), from World Acceptance Corporation of Alabama, World Acceptance Corporation of Missouri, World Finance Corporation of Georgia, World Finance Corporation of Louisiana, World Acceptance Corporation of Oklahoma, Inc., World Finance Corporation of South Carolina, World Finance Corporation of Tennessee, World Finance Corporation of Texas, WFC Limited Partnership, WFC of South Carolina, Inc., World Finance Corporation of Illinois, World Finance Corporation of New Mexico, World Finance Corporation of Kentucky, and WFC Services, Inc. (the “Companies” and individually a “Company”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Subsidiary Security Agreement.

Subsequent to the Companies’ delivery of the Subsidiary Security Agreement, the Companies and the Security Trustee have agreed to add Deposit Accounts (as defined below), whether now owned or existing or hereafter created, acquired or arising, as Collateral under the Subsidiary Security Agreement. The Companies and the Security Trustee now desire to amend the Subsidiary Security Agreement to reflect such addition.

SECTION 1. AMENDMENTS.

Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Subsidiary Security Agreement shall be and is hereby amended as follows:

1.1. Section 2.9 of the Subsidiary Security Agreement shall be amended and restated in its entirety to read as follows:

Section 2.9. Deposit Accounts. All Deposit Accounts, as such term is defined in the Uniform Commercial Code, of such Company; and

1.2. Section 2 of the Subsidiary Security Agreement shall be further amended by inserting the following subsection in proper numerical order:

Section 2.10. Other Proceeds and Products. All proceeds and products of the foregoing and all insurance of the foregoing and proceeds thereof, whether now existing or hereafter arising.

1.3. Section 3 of the Subsidiary Security Agreement shall be amended by inserting the following subsection in proper numerical order:

Section 3.11. Deposit Accounts. Each Company maintains one or more local deposit accounts for the deposit of checks and making of disbursements in the ordinary course of business (“Local Accounts”) and World maintains one or more concentration accounts into which each such Company sweeps collections from the Local Accounts in the ordinary course of business (“Concentration Accounts”). All Concentration Accounts used by each Company as of August 21, 2003, are listed and identified (by account number and depository institution) on Schedule V attached hereto and made a part hereof. Such Company shall promptly notify the Security Trustee of any Concentration Account opened, maintained or used by such Company after the date hereof, and shall submit to the Security Trustee a supplement to Schedule V to reflect such additional accounts (provided such Company’s failure to do so shall not impair the Security Trustee’s security interest therein). So long as no Event of Default has occurred and is continuing, the Security Trustee’s security interest in the Local Accounts need not be perfected. With respect to any Concentration Account maintained by a depository institution other than the Security Trustee, and as a condition to the establishment and maintenance of any such Concentration Account, at all times on and after December 31, 2003, the relevant Company and such depository institution shall have executed and delivered to the Security Trustee an account control agreement in form and substance satisfactory to the Security Trustee which provides, among other things, for the depository institution’s agreement that it will comply with instructions originated by the Security Trustee directing the disposition of the funds in the Concentration Account(s) held at such depositary institution without further consent by such Company.

1.4. Schedule V is hereby added to the Subsidiary Security Agreement, to read as set forth on Schedule V to this Amendment.

SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

Each Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Subsidiary Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Subsidiary Security Agreement after giving effect to this Amendment. Each Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Subsidiary Security Agreement after giving effect to this Amendment.

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SECTION 3. MISCELLANEOUS.

3.1. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Subsidiary Security Agreement, any reference in any of such to the Subsidiary Security Agreement to be deemed to reference to the Subsidiary Security Agreement as modified hereby.

3.2. Except as specifically modified hereby, all the terms and conditions of the Subsidiary Security Agreement shall stand and remain unchanged and in full force and effect.

3.3. This Amendment may be executed in any number of counterparts, and by the different parties on different counterpart pages, all of which taken together shall constitute one and the same agreement. Any of the parties hereto may execute this Amendment by signing any such counterpart and each of such counterparts shall for all purposes be deemed to be an original. This Amendment shall be governed by the laws of the State of South Carolina.

[SIGNATURE PAGES TO FOLLOW]

-3-

This Second Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust is dated as of August 21, 2003.

WORLD ACCEPTANCE CORPORATION OF ALABAMA
WORLD ACCEPTANCE CORPORATION OF MISSOURI
WORLD FINANCE CORPORATION OF GEORGIA
WORLD FINANCE CORPORATION OF LOUISIANA
WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC.
WORLD FINANCE CORPORATION OF SOUTH CAROLINA
WORLD FINANCE CORPORATION OF TENNESSEE
WFC OF SOUTH CAROLINA, INC.
WORLD FINANCE CORPORATION OF ILLINOIS
WORLD FINANCE CORPORATION OF NEW MEXICO
WORLD FINANCE CORPORATION OF KENTUCKY
WFC SERVICES, INC.
By
	A. Alexander McLean III
Its	Executive Vice President

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WFC LIMITED PARTNERSHIP
By	WFC of South Carolina, Inc., as sole general partner
	By
		A. Alexander McLean III
	Its	Executive Vice President
WORLD FINANCE CORPORATION OF TEXAS
By
	Charles F. Gardner, Jr.
Its	President

Acknowledged and agreed to as of the date first above written.

HARRIS TRUST AND SAVINGS BANK, as Security Trustee

By

Name

Title

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NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Subsidiary Security Agreement, the undersigned Noteholders hereby consent to the Second Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

HARRIS TRUST AND SAVINGS BANK
By
Its	.
BANK ONE, NA
By
Its
LASALLE BANK NATIONAL ASSOCIATION
By
Its
HIBERNIA NATIONAL BANK
By
Its
WELLS FARGO FINANCIAL PREFERRED CAPITAL, INC.
By
Its
CAROLINA FIRST BANK
By
Its

-6-

PRINCIPAL LIFE INSURANCE COMPANY

By

Its

By

Its

-7-

SCHEDULE V

CONCENTRATION ACCOUNTS

ACCOUNT NUMBER	DEPOSITORY INSTITUTION
2079891217439	Wachovia Bank

-8-

THIRD AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Subsidiary Security Agreement”), from World Acceptance Corporation of Alabama, World Acceptance Corporation of Missouri, World Finance Corporation of Georgia, World Finance Corporation of Louisiana, World Acceptance Corporation of Oklahoma, Inc., World Finance Corporation of South Carolina, World Finance Corporation of Tennessee, World Finance Corporation of Texas, WFC Limited Partnership, WFC of South Carolina, Inc., World Finance Corporation of Illinois, World Finance Corporation of New Mexico, World Finance Corporation of Kentucky, WFC Services, Inc., and World Finance Corporation of Colorado (the “Companies” and individually a “Company”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Subsidiary Security Agreement.

Subsequent to the Companies’ delivery of the Subsidiary Security Agreement, the Senior Secured Notes and the Senior Subordinated Notes have been paid in full. The Companies and the Security Trustee now desire to amend the Subsidiary Security Agreement to reflect such changes and to make certain other amendment to the Subsidiary Security Agreement as provided for herein.

SECTION 1. AMENDMENTS.

Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Subsidiary Security Agreement shall be and is hereby amended as follows:

1.1. On or about June 30, 2004, the Senior Subordinated Notes were paid in full and are no longer outstanding. On or about December 31, 1999, the Senior Secured Notes were paid in full and are no longer outstanding. Accordingly, any and all references in the Subsidiary Security Agreement to the terms “Senior Note Agreements,” “Senior Secured Notes,” “Senior Subordinated Notes,” and “Senior Subordinated Note Agreement” shall be deleted.

1.2. Recital I to the Subsidiary Security Agreement shall be amended and restated in its entirety to read as follows:

World has also entered into the Amended and Restated Revolving Credit Agreement dated as of June 30, 1997 (the “Revolving Credit Agreement”), which Revolving Credit Agreement amends and restates the Original Revolving Credit Agreement and the Original Revolving Credit Notes and provides for borrowings, whether or not such borrowings are evidenced by promissory notes and as the same may from time to time be amended or restated pursuant to the

terms thereof and any notes executed in replacement thereof (the “Revolving Credit Notes”).

In addition, all references to the terms “Senior Notes” and “Notes” in the Subsidiary Security Agreement shall from and after the date hereof be deemed a reference to the Revolving Credit Notes.

1.3. The definitions of “Aggregate Principal Amount of the Outstanding Notes,” “Consolidated Adjusted Net Worth,” “Make-Whole Amount,” “Material Event of Default,” “Maximum Principal Amount,” appearing in Section 1.1 of the Subsidiary Security Agreement shall be deleted.

1.4. All references to the phase “holders of a majority of the Aggregate Principal Amount of the Outstanding Notes” or words of like import in the Subsidiary Security Agreement shall from and after the date hereof be deemed a reference to the Required Banks as hereinafter defined.

1.5. The definitions of “Company,” “Indebtedness for Borrowed Money,” “Secured Indebtedness,” and “Subsidiary Guaranty Agreements” appearing in Section 1.1 of the Subsidiary Security Agreement shall be amended and restated in their entirety to read as follows:

“Company” shall mean each of World Acceptance Corporation of Alabama, an Alabama corporation, World Acceptance Corporation of Missouri, a Missouri corporation, World Finance Corporation of Georgia, a Georgia corporation, World Finance Corporation of Louisiana, a Louisiana corporation, World Acceptance Corporation of Oklahoma, Inc., an Oklahoma corporation, World Finance Corporation of South Carolina, a South Carolina corporation, World Finance Corporation of Tennessee, a Tennessee corporation, World Finance Corporation of Texas, a Texas corporation, WFC Limited Partnership, a Texas limited partnership, WFC of South Carolina, Inc., a South Carolina corporation, World Finance Corporation of Illinois, an Illinois corporation, World Finance Corporation of New Mexico, a New Mexico corporation, World Finance Corporation of Kentucky, a Kentucky corporation, WFC Services, Inc., a Tennessee corporation, and World Finance Corporation of Colorado, a Colorado corporation, any entity that executes and delivers a Security Agreement Supplement in the form attached hereto as Exhibit A (or in such other form approved by the Security Trustee and the Agent), and any Person which succeeds to all, or substantially all of the assets and business of any such entity.

“Indebtedness for Borrowed Money” shall have the same meaning herein as such term is defined in the Revolving Credit Agreement.

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“Secured Indebtedness” shall mean the “Obligations,” as such term is defined in the Revolving Credit Agreement, in each case whether now existing or hereafter arising, due or to become due, direct or indirect, absolute or contingent, and howsoever evidenced, held or acquired.

“Subsidiary Guaranty Agreement” shall mean the Amended and Restated Guaranty Agreement dated as of June 30, 1997, of each Restricted Subsidiary existing on such date and each other Restricted Subsidiary which has executed a Guaranty Supplement in the form of Exhibit A thereto pursuant to the terms thereof and Section 3.9 of the World Security Agreement (or in such other form agreed to by the Agent), in each case, for the benefit of the Security Trustee and the holders of the Senior Notes, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

1.6. Section 1.1 of the Subsidiary Security Agreement shall be amended by adding in appropriate alphabetical order the following definition:

“Required Banks” shall have the same meaning herein as such term is defined in the Revolving Credit Agreement.

1.7. Section 9.2 of the Subsidiary Security Agreement shall be amended and restated to read as follows:

Section 9.2. Waivers and Consents by Noteholders; Supplemental Security Agreements with Noteholders’ Consent. (a) Upon the waiver or consent of the Agent (acting at the direction or with the consent of the Required Banks under the Revolving Credit Agreement), the Company and the Security Trustee may enter into an agreement or agreements supplemental hereto for the purpose of waiving, adding, changing or eliminating any provisions of this Agreement or of any agreement supplemental hereto or modifying in any manner the rights and obligations of the holders of the Notes and the Company.

1.8. Section 10.4 of the Subsidiary Security Agreement shall be amended and restated to read as follows:

Section 10.4. Release. The Security Trustee shall release fully or partially, as the case may be, the Lien granted by this Agreement under and only under the following circumstances:

(a) Upon the presentation of satisfactory evidence that all Secured Indebtedness has been irrevocably fully paid or

-3-

discharged and all obligations of the holders of Notes to extend Secured Indebtedness to World have terminated or otherwise expired, the Security Trustee shall release the Lien and security interest of this Agreement by proper instrument or instruments;

(b) So long as no Default or Event of Default then exists, upon the sale or other disposition of any assets of World and its Restricted Subsidiaries which the Chief Financial Officer of World certifies to the Security Trustee and the Noteholders in writing does not constitute a “substantial part” of the assets of World and its Restricted Subsidiaries (as defined in Section 8.13 of the Revolving Credit Agreement), the Security Trustee shall, upon the written direction of World and without the consent of the Noteholders (unless the Security Trustee has been notified in writing by a Noteholder prior to such release that such Noteholder in good faith believes that the conditions set forth above have not been satisfied, in which case no such release shall be issued), release the Lien of this Agreement on such assets by proper instrument or instruments. If any such sale or other disposition of assets constituting less than a “substantial part” of the assets of World and its Restricted Subsidiaries pursuant to this §10.4(b) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreement with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as World may deem necessary or proper to carry out more effectively the foregoing;

(c) Upon the sale or other disposition by World of a “substantial part” of the assets of World and its Restricted Subsidiaries (as defined in Section 8.13 of the Revolving Credit Agreement) after the occurrence and during the continuance of an Event of Default, the Security Trustee shall, upon the written direction of the Company and the written consent of the Required Banks, release the Lien of this Agreement on such assets by proper instrument or instruments, provided, that, (i) such sale or other disposition is not to an Affiliate, (ii) the sale price for such assets is determined by World in good faith to be reasonable, as evidenced by a resolution of the board of directors of World, (iii) the proceeds of any such sale or other disposition are applied to the satisfaction of Secured Indebtedness and, if such application results in the prepayment of any obligations under the Revolving Credit Agreement, such application permanently reduces the amount of the commitment under the Revolving Credit Agreement (unless the

-4-

Required Banks agree otherwise), (iv) each Noteholder shall have received written notice of such sale or other disposition at least ten days prior to the date of such sale or other disposition and (v) the Security Trustee and the Noteholders receive a certificate of the Chief Financial Officer of World certifying to each of the foregoing. If any such sale or other disposition of assets of World and its Restricted Subsidiaries pursuant to this §10.4(c) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreement with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as World may deem necessary or proper to carry out more effectively the foregoing;

(d) Upon the sale or other disposition of the Collateral or any part thereof pursuant to and in accordance with §7.2 and conducted in a commercially reasonable manner, the Security Trustee shall release the Lien of this Agreement on the Collateral or such part, as the case may be, by proper instrument or instruments; and

(e) With the prior written consent of each Noteholder, the Security Trustee shall release the Lien of this Agreement or on any assets covered by this Agreement by proper instrument or instruments.

1.9. Section 10.9 of the Subsidiary Security Agreement shall be amended and restated to read as follows:

Section 10.9. Intentionally Deleted.

SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

Each Company hereby represents and warrants to the Security Trustee and the Noteholders that the Senior Secured Notes and the Senior Subordinated Notes (as defined prior to giving effect to this Amendment) have been paid in full and the Senior Note Agreements and Senior Subordinate Note Agreement have terminated in accordance with their terms. Each Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Subsidiary Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Subsidiary Security Agreement after giving effect to this Amendment. Each Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Subsidiary Security Agreement after giving effect to this Amendment.

-5-

SECTION 3. MISCELLANEOUS.

3.1. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Subsidiary Security Agreement, any reference in any of such to the Subsidiary Security Agreement to be deemed to reference to the Subsidiary Security Agreement as modified hereby.

3.2. Except as specifically modified hereby, all the terms and conditions of the Subsidiary Security Agreement shall stand and remain unchanged and in full force and effect.

3.3. This Amendment may be executed in any number of counterparts, and by the different parties on different counterpart pages, all of which taken together shall constitute one and the same agreement. Any of the parties hereto may execute this Amendment by signing any such counterpart and each of such counterparts shall for all purposes be deemed to be an original. This Amendment shall be governed by the laws of the State of South Carolina.

[SIGNATURE PAGES TO FOLLOW]

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This Third Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust is dated as of August     , 2004.

WORLD ACCEPTANCE CORPORATION OF ALABAMA WORLD ACCEPTANCE CORPORATION OF MISSOURI WORLD FINANCE CORPORATION OF GEORGIA WORLD FINANCE CORPORATION OF LOUISIANA WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC. WORLD FINANCE CORPORATION OF SOUTH CAROLINA WORLD FINANCE CORPORATION OF TENNESSEE WFC OF SOUTH CAROLINA, INC. WORLD FINANCE CORPORATION OF ILLINOIS WORLD FINANCE CORPORATION OF NEW MEXICO WORLD FINANCE CORPORATION OF KENTUCKY WFC SERVICES, INC. WORLD FINANCE CORPORATION OF COLORADO
By
	A. Alexander McLean III
Its	Executive Vice President
WFC LIMITED PARTNERSHIP
By	WFC of South Carolina, Inc., as sole general partner
	By
		A. Alexander McLean III
	Its	Executive Vice President

-7-

WORLD FINANCE CORPORATION OF TEXAS
By
	Charles F. Gardner, Jr.
Its	President
HARRIS TRUST AND SAVINGS BANK, as Security Trustee
By
Name
Title

-8-

NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Subsidiary Security Agreement, the undersigned Noteholders hereby consent to the Third Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

HARRIS TRUST AND SAVINGS BANK

By

Its

BANK ONE, NA

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED
CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

-9-

FOURTH AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Subsidiary Security Agreement”), from World Acceptance Corporation of Alabama, World Acceptance Corporation of Missouri, World Finance Corporation of Georgia, World Finance Corporation of Louisiana, World Acceptance Corporation of Oklahoma, Inc., World Finance Corporation of South Carolina, World Finance Corporation of Tennessee, World Finance Corporation of Texas, WFC Limited Partnership, WFC of South Carolina, Inc., World Finance Corporation of Illinois, World Finance Corporation of New Mexico, World Finance Corporation of Kentucky, World Finance Corporation of Colorado, and WFC Services, Inc., a South Carolina corporation (the “Companies” and individually a “Company”) to Harris N.A., as successor by merger to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Subsidiary Security Agreement.

World and the holders of the Senior Notes have concurrently herewith entered into an Amended and Restated Revolving Credit Agreement, which continues to be secured by, among other things, the Collateral. The Companies and the Security Trustee now desire to amend the Subsidiary Security Agreement to reflect such change and to make certain other amendment to the Subsidiary Security Agreement as provided for herein.

SECTION 1. AMENDMENTS.

Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Subsidiary Security Agreement shall be and is hereby amended as follows:

1.1. All references to the term “Revolving Credit Agreement” in the Subsidiary Security Agreement shall from and after the date hereof be deemed a reference to the Amended and Restated Revolving Credit Agreement dated as of July 20, 2005, by and among World, the financial institutions from time to time party thereto, as Banks, and Harris N.A., as Agent, as the same may from time to time hereafter be further amended or modified, including further amendments and restatements of the same in its entirety; and all references to the term “Senior Notes” and “Notes” in the Subsidiary Security Agreement shall from and after the date hereof be deemed a reference to the promissory notes issued from time to time pursuant to the Revolving Credit Agreement, including any and all promissory notes executed in substitution or replacement therefor or an extension or renewal thereof, in each case as the same may be amended or modified from time to time.

1.2. Section 2 of the Subsidiary Security Agreement shall be amended by striking the period appearing after Section 2.10 and inserting in its place a semicolon followed by the following phrase:

provided that, in the case of a lien and security interest on the voting stock or other similar voting equity interests of a corporation, limited liability company, partnership or other

organization which is a “controlled foreign corporation” as defined under Section 957 of the Internal Revenue Code (herein, a “Foreign Company”), if granting a security interest of more than 65% of the total combined voting stock or other voting equity interests of any such Foreign Company would cause adverse tax consequences to such Company, then such lien and security interest on the voting stock or other voting equity interests shall be limited to 65% of the total combined voting stock or other voting equity interests of such Foreign Company.

1.3. WFC Services, Inc., a Tennessee corporation (“WFC-TN”), an inactive dormant subsidiary of World, shall be removed as a Company party to the Subsidiary Security Agreement and as an Additional Guarantor under the Subsidiary Guaranty Agreement referred to therein.

SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

Each Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Subsidiary Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Subsidiary Security Agreement after giving effect to this Amendment. Each Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Subsidiary Security Agreement after giving effect to this Amendment.

SECTION 3. MISCELLANEOUS.

3.1. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Subsidiary Security Agreement, any reference in any of such to the Subsidiary Security Agreement to be deemed to reference to the Subsidiary Security Agreement as modified hereby.

3.2. Except as specifically modified hereby, all the terms and conditions of the Subsidiary Security Agreement shall stand and remain unchanged and in full force and effect.

3.3. This Amendment may be executed in any number of counterparts, and by the different parties on different counterpart pages, all of which taken together shall constitute one and the same agreement. Any of the parties hereto may execute this Amendment by signing any such counterpart and each of such counterparts shall for all purposes be deemed to be an original. This Amendment shall be governed by the laws of the State of South Carolina.

[SIGNATURE PAGES TO FOLLOW]

-2-

This Fourth Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust is dated as of July 20, 2005.

WORLD ACCEPTANCE CORPORATION OF ALABAMA WORLD ACCEPTANCE CORPORATION OF MISSOURI WORLD FINANCE CORPORATION OF GEORGIA WORLD FINANCE CORPORATION OF LOUISIANA WORLD ACCEPTANCE CORPORATION OF OKLAHOMA, INC. WORLD FINANCE CORPORATION OF SOUTH CAROLINA WORLD FINANCE CORPORATION OF TENNESSEE WFC OF SOUTH CAROLINA, INC. WORLD FINANCE CORPORATION OF ILLINOIS WORLD FINANCE CORPORATION OF NEW MEXICO WORLD FINANCE CORPORATION OF KENTUCKY WORLD FINANCE CORPORATION OF COLORADO WFC SERVICES, INC., a South Carolina corporation
By
	A. Alexander McLean III
Its	Executive Vice President
WFC LIMITED PARTNERSHIP
By	WFC of South Carolina, Inc., as sole general partner
	By
		A. Alexander McLean III
	Its	Executive Vice President

-3-

WORLD FINANCE CORPORATION OF TEXAS
By
	Charles F. Gardner, Jr.
Its	President
HARRIS N.A., as successor by merger to Harris Trust and Savings Bank, as Security Trustee
By
Name
Title

-4-

NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Subsidiary Security Agreement, the undersigned Noteholders hereby consent to the Fourth Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment. Without limiting the foregoing, each of the undersigned Noteholders agrees to release WFC Services, Inc., a Tennessee corporation, as a Company under the Subsidiary Security Agreement and as an Additional Guarantor under the Subsidiary Guaranty Agreement referred to therein.

HARRIS N.A., as successor by merger to Harris
Trust and Savings Bank, as Security Trustee

By

Its

JPMORGAN CHASE BANK, N.A.

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED
CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

-5-

EX-4.6

Exhibit 4.6

CONFORMED COPY

AMENDED AND RESTATED SECURITY AGREEMENT, PLEDGE

AND

INDENTURE OF TRUST

Dated as of June 30, 1997

Between

WORLD ACCEPTANCE CORPORATION

And

HARRIS TRUST AND SAVINGS BANK,

as Security Trustee

TABLE OF CONTENTS

SECTION	HEADING	PAGE
Parties
Recitals		1
SECTION 1.	INTERPRETATION OF AGREEMENT; DEFINITIONS	2
Section 1.1.	Definitions	2
Section 1.2.	Accounting Principles	8
Section 1.3.	Directly or Indirectly	8
SECTION 2.	GRANTING CLAUSES	8
Section 2.1.	Equipment	9
Section 2.2.	Receivables	9
Section 2.3.	Pledged Collateral	9
Section 2.4.	General Intangibles	9
Section 2.5.	Investment Property	9
Section 2.6.	Records and Cabinets	10
Section 2.7.	Partnership Interests	10
Section 2.8.	Additional Property	10
Section 2.9.	Other Proceeds and Products	10
SECTION 3.	COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY	11
Section 3.1.	Location of Collateral	11
Section 3.2.	Warranty of Title	11
Section 3.3.	No Alienation of Collateral	12
Section 3.4.	Removal of Collateral	12
Section 3.5.	Compliance with Leases	12
Section 3.6.	Protection of Collateral	12
Section 3.7.	Further Assurances	12
Section 3.8.	Maintenance of Lien; Recording; Opinions of Counsel	13
Section 3.9.	Guaranty and Security Agreement Supplements	14
Section 3.10.	Note Register	14
SECTION 4.	SPECIAL PROVISIONS RELATING TO RECEIVABLES	14
Section 4.1.	Representations and Warranties	14
Section 4.2.	Receivable Schedules	16
Section 4.3.	Collection of Receivables	16
Section 4.4.	Power of Attorney	17

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SECTION 5.	SPECIAL PROVISIONS RELATING TO PLEDGED COLLATERAL	18
Section 5.1.	Delivery of Pledged Collateral; Transfer to Security Trustee	18
Section 5.2.	Voting Power; Payments	18
Section 5.3.	Covenants of the Company	19
SECTION 6.	APPLICATION OF CERTAIN MONEYS	21
Section 6.1.	Application if no Default or Event of Default Exists	21
Section 6.2.	Application if a Default or an Event of Default Exists	21
SECTION 7.	DEFAULTS AND REMEDIES	21
Section 7.1.	Events of Default	21
Section 7.2.	Security Trustee’s Rights	21
Section 7.3.	Waiver by Company	22
Section 7.4.	Effect of Sale	22
Section 7.5.	Application of Sale and Other Proceeds	23
Section 7.6.	Discontinuance of Remedies	24
Section 7.7.	Cumulative Remedies	24
SECTION 8.	THE SECURITY TRUSTEE	25
Section 8.1.	Duties of Security Trustee	25
Section 8.2.	Security Trustee’s Liability	26
Section 8.3.	No Responsibility of Security Trustee for Recitals	27
Section 8.4.	Certain Limitations on Security Trustee’s Rights to Compensation and Indemnification	27
Section 8.5.	Status of Moneys Received	28
Section 8.6.	Resignation of Security Trustee	28
Section 8.7.	Removal of Security Trustee	28
Section 8.8.	Appointment of Successor Security Trustee	28
Section 8.9.	Succession of Successor Security Trustee	29
Section 8.10.	Eligibility of Security Trustee	29
Section 8.11.	Successor Security Trustee by Merger	30
Section 8.12.	Co-Trustees	30
Section 8.13.	Compensation and Reimbursement	30
SECTION 9.	SUPPLEMENTS; WAIVERS	31
Section 9.1.	Supplemental Security Agreements Without Noteholder Consent	31
Section 9.2.	Waivers and Consents by Noteholders; Supplemental Security Agreements with Noteholders’ Consent	31
Section 9.3.	Notice of Supplements	33
Section 9.4.	Opinion of Counsel Conclusive as to Supplements	33
SECTION 10.	MISCELLANEOUS	33

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Section 10.1.	Successors and Assigns	33
Section 10.2.	Severability	3
Section 10.3.	Communications	34
Section 10.4.	Release	34
Section 10.5.	Counterparts	36
Section 10.6.	Governing Law	36
Section 10.7.	Headings	36
Section 10.8.	Prior Liens	36
Section 10.9.	Rights of Holders of Senior Subordinated Notes	36
Signature Page		37

ATTACHMENTS TO SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST:

Schedule I	— Description of Pledged Shares
Schedule II	— Description of Partnership Interest
Schedule III	— Locations of the Company’s Offices and Facilities
Exhibit A	— Form of Subsidiary Security Agreement
Exhibit B	— Form of Subsidiary Guaranty Agreement

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AMENDED AND RESTATED SECURITY AGREEMENT, PLEDGE

AND

INDENTURE OF TRUST

AMENDED AND RESTATED SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST (this “Agreement”) dated as of June 30, 1997, between WORLD ACCEPTANCE CORPORATION, a South Carolina corporation (the “Company”), and HARRIS TRUST AND SAVINGS BANK, an Illinois banking corporation (the “Security Trustee”) which amends and restates that certain Security Agreement, Pledge and Indenture of Trust dated as of December 1, 1992 (as the same has been amended, restated, modified, supplemented or waived pursuant to the terms thereof) between the Company and the Security Trustee (the “Original Security Agreement”). The post office addresses of the Company and the Security Trustee are set forth in §10.3.

RECITALS:

A. The capitalized terms used in this Agreement shall have the respective meanings specified in §1.1 unless otherwise herein defined or the context hereof shall otherwise require.

B. The Company is authorized by law, and deems it necessary from time to time, to borrow money for its proper purposes and to secure the same as hereinafter provided, and to that end, in the exercise of said authority, has duly authorized the execution and delivery of this Agreement providing for the securing of certain obligations of the Company hereunder, all as hereinafter provided.

C. The Company has duly authorized, on the terms provided in the Senior Note Agreements, the issuance of $20,000,000 aggregate principal amount of Senior Secured Notes due December 1, 1999, as the same may from time to time be amended or restated pursuant to the terms thereof and of the Senior Note Agreements and any notes executed in replacement thereof (the “Senior Secured Notes”). The Company has also authorized borrowings pursuant to the Revolving Credit Agreement, whether or not such borrowings are evidenced by promissory notes and as the same may from time to time be amended or restated pursuant to the terms thereof and any notes executed in replacement thereof, in a maximum principal amount of borrowings at any one time outstanding not to exceed the Maximum Principal Amount (the “Revolving Credit Notes”). The Senior Secured Notes and the Revolving Credit Notes are hereinafter collectively referred to as the “Senior Notes.” The Company has also authorized, on the terms provided in the Senior Subordinated Note Agreement, the issuance of $10,000,000 aggregate principal amount of Senior Subordinated Secured Notes due June 30, 2004, as the same may from time to time be amended or restated pursuant to the terms thereof and of the Senior Subordinated Note Agreement and any notes executed in replacement thereof (the “Senior Subordinated Notes”). The Senior Notes and the Senior Subordinated Notes are hereinafter collectively referred to as the “Notes”.

D. All acts and proceedings required by law and by the Articles of Incorporation and By-Laws of the Company, to make the above-described Notes, when executed by the Company the valid, binding and legal obligations of the Company, and to constitute this Agreement a valid

World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

and binding agreement for the uses and purposes herein set forth, in accordance with its terms, have been done and taken, and the execution and delivery of this Agreement has been in all respects duly authorized.

SECTION 1. INTERPRETATION OF AGREEMENT; DEFINITIONS.

Section 1.1. Definitions. Unless the context otherwise requires, the terms hereinafter set forth when used herein shall have the following meanings and the following definitions shall be equally applicable to both the singular and plural forms of any of the terms herein defined:

“Account Debtor” shall mean any Person who is or may become obligated to the Company under or on account of a Receivable.

“Affiliate” shall mean any Person (other than a Restricted Subsidiary) (i) which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, the Company, (ii) which beneficially owns or holds 5% or more of any class of the Voting Stock (determined by number of shares or by number of votes) of the Company or (iii) 5% or more of the Voting Stock (determined by number of shares or by number of votes) (or in the case of a Person which is not a corporation, 5% or more of the equity interest) of which is beneficially owned or held by the Company or a Subsidiary. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of Voting Stock, by contract or otherwise.

“Agent” shall mean Harris Trust and Savings Bank and its permitted successors and assigns, in each case in its capacity as agent for the Banks under the Revolving Credit Agreement.

“Aggregate Principal Amount of the Outstanding Notes” shall mean (i) for purposes of §8.1 (A) if any Senior Note or any obligation or liability owing under the Revolving Credit Agreement or the Senior Note Agreement remains outstanding or any obligation to extend credit under the Revolving Credit Agreement exists, the sum of the actual principal amount of the Senior Notes then outstanding, and (B) if no Senior Note and no other obligation or liability owing under the Revolving Credit Agreement or the Senior Note Agreement is then outstanding and all obligations to extend credit under the Revolving Credit Agreement have expired or otherwise terminated, the sum of the actual principal amount of the Senior Subordinated Notes then outstanding, (ii) for purposes of §8.7 and §8.8, the sum of the actual principal amount of the Notes then outstanding, plus the amount of the unused commitment with respect to the Revolving Credit Notes and (iii) for purposes of §9.2 and §10.4 (A) so long as no Event of Default shall have occurred and be continuing, the sum of the actual principal amount of Notes then outstanding, plus the amount of the unused commitment with respect to the Revolving Credit Notes and (B) if an Event of Default shall have occurred and be continuing, the actual principal amount of the Notes then outstanding.

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“Banks” shall mean Harris Trust and Savings Bank, The First National Bank of Chicago, LaSalle National Bank and the other banks or financial institutions that are or become a party to the Revolving Credit Agreement.

“Closing Date” shall mean July 3, 1997.

“Collateral” as used herein shall mean any and all property from time to time subject to the security interest granted hereby.

“Company” shall mean World Acceptance Corporation, a South Carolina corporation and any Person which succeeds to all, or substantially all of the assets and business of World Acceptance Corporation.

“Consolidated Adjusted Net Worth” shall have the meaning specified in the Senior Subordinated Note Agreement as in effect on the Closing Date.

“Corporate Base Rate” means for any day the rate of interest announced by Harris Trust and Savings Bank from time to time as its prime commercial rate, or equivalent, with any change in the Corporate Base Rate resulting from a change in said prime commercial rate to be effective as of the date of the relevant change in said prime commercial rate.

“Default” shall mean any event or condition, the occurrence of which would, with the lapse of time or the giving of notice, or both, constitute an Event of Default.

“Event of Default” shall have the meaning specified in §7.1.

“GAAP” shall mean generally accepted accounting principles at the time in the United States.

“Governing Documents” shall mean collectively the charter instruments, by-laws, partnership agreements, operating agreements and other similar documents prescribing the internal governance of each Restricted Subsidiary.

“Indebtedness for Borrowed Money” shall have the meaning specified in the Senior Subordinated Note Agreement as in effect on the Closing Date.

“Insurance Subsidiary” shall mean any one Subsidiary (i) which is organized under the laws of the British Virgin Islands or such other jurisdiction as shall be consented to in writing by all of the holders of the Notes; (ii) which conducts substantially all of its business and has substantially all of its assets within the British Virgin Islands or such other jurisdiction as shall be consented to in writing by all of the holders of the Notes; (iii) of which 100% (by number of votes) (other than directors’ qualifying shares) of the Voting Stock is owned by the Company; and (iv) which is engaged in the business of reinsuring the credit insurance written by the Subsidiaries.

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“Investment Property” shall have the meaning specified in §2.5.

“Lien” shall mean any interest in property securing an obligation owed to a Person, whether such interest is based on the common law, statute or contract, and including but not limited to the security interest arising from a mortgage, security agreement, encumbrance, pledge, conditional sale or trust receipt or a lease, consignment or bailment for security purposes. The term “Lien” includes reservations, exceptions, encroachments, easements, rights of way, covenants, conditions, restrictions, leases and other similar title exceptions and encumbrances, including but not limited to mechanics’, materialmen’s, warehousemen’s, carriers’ and other similar encumbrances, affecting property. For the purposes of this Agreement, a Person shall be deemed to be the owner of any property which it has acquired or holds subject to a conditional sale agreement or other arrangement pursuant to which title to the property has been retained by or vested in some other Person for security purposes.

“Make-Whole Amount” (i) with respect to the Senior Secured Notes, shall have the meaning as defined in the Senior Note Agreements and (ii) with respect to the Senior Subordinated Notes, shall have the meaning as defined in the Senior Subordinated Note Agreement.

“Material Event of Default” shall mean (i) an Event of Default shall have occurred under any of Sections 6.1(a), (b), (c), (n), (o), (p) or (q) of any Senior Note Agreement, (ii) an Event of Default shall have occurred under any of Sections 9.1(a), (b), (c), (n), (p), (q) or (r) of the Revolving Credit Agreement, (iii) an Event of Default shall have occurred with respect to Sections 5.7, 5.8, 5.9, 5.10, 5.11 (but only to the extent such Event of Default relates to a Lien on property of the Company or any Restricted Subsidiary with a fair market value in excess of $1,000,000), 5.12, 5.13 or 5.18 of any Senior Note Agreement or (iv) an Event of Default shall have occurred with respect to Sections 8.7, 8.8, 8.9, 8.10, 8.11 (but only to the extent such Event of Default relates to a Lien on property of the Company or any Restricted Subsidiary with a fair market value in excess of $1,000,000), 8.12, 8.13 or 8.18 of the Revolving Credit Agreement.

“Maximum Principal Amount” shall mean an amount equal to (i) $65,000,000, plus (ii) any principal amount in excess thereof agreed to in writing by the holders of the Senior Subordinated Notes, plus (iii) any principal amount in excess thereof; provided, that, at the time of any increase in the amount of the commitment of the Banks under the Revolving Credit Agreement, the Agent shall have received a certificate or certificates of the Chief Financial Officer of the Company and an authorized officer of each holder of the Senior Subordinated Notes, in each case, certifying that on the date of such increase and after giving effect thereto and, in the case of clause (B) below, after giving effect to the treatment of the maximum aggregate amount of the commitment as so increased as having been incurred as Indebtedness for Borrowed Money on the last day of the calendar month then most recently ended and, in the case of any certificate delivered by any holder of the Senior Subordinated Notes, to the knowledge of such holder, (A) there does not exist any Default or Event of Default under clauses (a), (b), (c), (n), (o), (p) or (q) of Section 6.1 of the Senior Subordinated Note Agreement as in effect on the Closing Date or under Sections 5.7, 5.8, 5.9, 5.10, 5.11 (but only to the extent such Default or Event of Default relates to a Lien on property of the Company or any Restricted Subsidiary with

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World Acceptance Corporation Amended and Restated Security Agreement,

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a fair market value in excess of $1,000,000), 5.12, 5.13 or 5.18 of the Senior Subordinated Note Agreement as in effect on the Closing Date and (B) the ratio of Indebtedness for Borrowed Money of the Company and its Restricted Subsidiaries to Consolidated Adjusted Net Worth for the calendar month then most recently ended does not exceed 6.5 to 1.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Note Register” (i) with respect to the Senior Secured Notes, shall have the meaning specified in Section 9.1 of the Senior Note Agreements and (ii) with respect to the Senior Subordinated Notes, shall have the meaning specified in Section 10.1 of the Senior Subordinated Note Agreement.

“Noteholders” shall mean, collectively, the holders from time to time and at any time of the Notes.

“Notes” shall have the meaning specified in the recitals hereof.

“Original Closing Date” shall mean December 29, 1992.

“Partnership Interests” shall have the meaning specified in §2.6.

“Person” shall mean an individual, partnership, corporation, limited liability company, trust or unincorporated organization, and a government agency or political subdivision thereof.

“Pledged Collateral” shall mean and include:

(a) the Pledged Shares;

(b) all shares, Securities, moneys, or other property distributed as a dividend on any shares of capital stock or other Pledged Collateral (including the Pledged Shares) at any time pledged hereunder or a distribution or return of capital upon or in respect of any such capital stock or other Pledged Collateral or any part thereof, or resulting from a split-up, revision, reclassification or other like change of any such capital stock or other Pledged Collateral, and any subscription warrants, rights or options issued to the holders of, or otherwise in respect of, any such capital stock or other Pledged Collateral; and

(c) in the event of any consolidation or merger in which the issuer of any Pledged Collateral is not the surviving entity, or in the event of any sale, lease, transfer or other disposition of all or substantially all of the assets of such issuer;

(i) all shares of each class of the capital stock or other Security of the successor entity formed by or resulting from such consolidation or merger, or of the corporation to which such sale, lease, transfer or other disposition shall have been made, and

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World Acceptance Corporation Amended and Restated Security Agreement,

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(ii) all other Securities, money or property,

distributed or distributable in any such event in respect of any of the Pledged Collateral in connection with such consideration, merger, sale, lease, transfer or other disposition.

“Pledged Shares” shall mean all of the capital stock, partnership interests, membership interests and other equity interests of each Restricted Subsidiary owned by the Company (as more specifically set forth on Schedule I hereto) or hereafter acquired, including, without limitation, (a) all rights, authority, powers and privileges of the Company as a shareholder or holder of any partnership interest, membership interest or other equity interest of the Restricted Subsidiaries, whether now existing or hereafter arising under the Governing Documents or at law or otherwise, and the rights of the Company under such Governing Documents to acquire additional shares of stock or partnership interests, membership interests or other equity interests or to acquire the shares of stock, partnership interest, membership interest or other equity interest of other shareholders, partners, members or other holders of equity interests, and (b) all other instruments owned or held by, or otherwise established in favor of, the Company in the nature of capital stock of, partnership interest, membership interest or any other equity interest in the Restricted Subsidiaries, of any and every type, class and series.

“Receivables” shall mean all accounts receivable, receivables, contract rights, controls, instruments, notes, drafts, bills, acceptances, documents, chattel paper, general intangibles and all other forms of obligations owing to a Person.

“Restricted Subsidiary” shall mean the Insurance Subsidiary, if any, and any other Subsidiary (i) which is organized under the laws of the United States or any State thereof; (ii) which conducts substantially all of its business and has substantially all of its assets within the United States; and (iii) of which 100% (by number of votes) of the Voting Stock is owned by the Company and/or one or more Restricted Subsidiaries.

“Revolving Credit Agreement” shall mean that certain Amended and Restated Revolving Credit Agreement dated as of June 30, 1997 among the Company, the Agent and the Banks, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Revolving Credit Notes” shall have the meaning specified in the recitals hereof.

“S&P” shall mean Standard & Poor’s Ratings Services Group, a division of The McGraw-Hill Companies, Inc.

“Secured Indebtedness” shall mean (i) the outstanding Notes and all principal thereof (and premium, if any) and interest thereon pursuant to the terms of the outstanding Notes, this Agreement, the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement; provided, that, in no event shall “Secured Indebtedness” include (A) the principal amount of the Revolving Credit Notes in excess of the Maximum Principal Amount and (B) the related interest thereon and (ii) all additional amounts and other sums at any

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time due and owing from or required to be paid by the Company or any Restricted Subsidiary under the terms of this Agreement, the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement, the Subsidiary Security Agreement and the Subsidiary Guaranty Agreements, as in effect on the Closing Date or as otherwise consented to in writing by all of the holders of the Notes.

“Security” shall have the same meaning as in Section 2(a)(1) of the Securities Act of 1933, as amended.

“Security Trustee” means the Person named above as the “Security Trustee” in the first paragraph of this Agreement until a successor Security Trustee shall have become such pursuant to the applicable provisions of this Agreement, and thereafter “Security Trustee” shall mean such successor Security Trustee.

“Senior Note Agreements” shall mean, collectively, the separate Amended and Restated Note Agreements, each dated as of June 30, 1997, between the Company and the respective note purchasers named therein, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Senior Notes” shall have the meaning specified in the recitals hereof.

“Senior Secured Notes” shall have the meaning specified in the recitals hereof.

“Senior Subordinated Note Agreement” shall mean that certain Note Agreement dated as of June 30, 1997 between the Company and the purchaser named therein, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Senior Subordinated Notes” shall have the meaning specified in the recitals hereof.

The term “subsidiary” shall mean, as to any particular parent corporation, any corporation, partnership, limited liability company or other entity of which more than 50% (by number of votes or other decision making authority) of the Voting Stock shall be owned by such parent corporation and/or one or more corporations, partnerships, limited liability companies or other entities which are themselves subsidiaries of such parent corporation. The term “Subsidiary” shall mean a subsidiary, directly or indirectly, of the Company.

“Subsidiary Guaranty Agreements” shall mean (i) the Amended and Restated Guaranty Agreement dated as of June 30, 1997 of each Restricted Subsidiary existing on the Closing Date and each other Restricted Subsidiary which has executed a Guaranty Supplement in the form of Exhibit A thereto pursuant to the terms thereof and §3.9, in each case, for the benefit of the Security Trustee and the holders of the Senior Notes, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof, and (ii) the Guaranty Agreement dated as of June 30, 1997 of each Restricted Subsidiary existing on the Closing Date and each other Restricted Subsidiary which has executed a Guaranty Supplement in

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World Acceptance Corporation Amended and Restated Security Agreement,

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the form of Exhibit A thereto pursuant to the terms thereof and §3.9, in each case, for the benefit of the Security Trustee and the holders of the Senior Subordinated Notes, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Subsidiary Security Agreement” shall mean the Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 between each Restricted Subsidiary existing on the Closing Date and the Security Trustee, as supplemented from time to time by a security agreement supplement between a Restricted Subsidiary and the Security Trustee delivered pursuant to the terms thereof and §3.9, in each such case, substantially in the form of Exhibit A to the Subsidiary Security Agreement, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

“Underlying Collateral” shall mean, with respect to any Receivable of the Company, all of its rights with respect to any collateral granted by the Account Debtor in connection with any Receivable owing by it to the Company.

“Uniform Commercial Code” as used herein with reference to any collateral shall mean the Uniform Commercial Code as enacted in the jurisdiction applicable to such Collateral, as amended from time to time, and any successor statute(s) thereto.

“Voting Stock” shall mean Securities or other equity interests of any class or classes, the holders of which are ordinarily, in the absence of contingencies, entitled to elect a majority of the corporate directors (or Persons performing similar functions).

Section 1.2. Accounting Principles. Where the character or amount of any asset or liability or item of income or expense is required to be determined or any consolidation or other accounting computation is required to be made for the purposes of this Agreement, the same shall be done in accordance with GAAP, to the extent applicable, except where such principles are inconsistent with the requirements of this Agreement.

Section 1.3. Directly or Indirectly. Where any provision in this Agreement refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether the action in question is taken directly or indirectly by such Person.

SECTION 2. GRANTING CLAUSES.

The Company in consideration of the premises and other good and valuable consideration, receipt whereof is hereby acknowledged, and intending to be legally bound, and in order to secure (i) the equal and pro rata payment of both the principal of and interest and premium, if any, on all Senior Notes at any time outstanding according to their tenor and effect, (ii) on a senior subordinated basis as set forth herein and in the Senior Subordinated Note Agreement, the equal and pro rata payment of both the principal of and interest and premium, if any, on all Senior Subordinated Notes at any time outstanding, according to their tenor and effect, and (iii) the payment of all other Secured Indebtedness and the performance and

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World Acceptance Corporation Amended and Restated Security Agreement,

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observance of all the covenants and conditions contained in the Notes, this Agreement, the Senior Note Agreements, the Revolving Credit Agreement, the Senior Subordinated Note Agreement, the Subsidiary Guaranty Agreements and the Subsidiary Security Agreement, in each case, subject to the terms thereof and §7.5, does hereby mortgage, grant, convey, warrant, assign, pledge and hypothecate unto the Security Trustee, its successors in trust and assigns, forever, and grants to the Security Trustee, its successors in trust and assigns, forever, a continuing security interest in, all and singular the following described properties, rights, interests and privileges, together with the proceeds thereof, now or hereafter owned by the Company (hereinafter sometimes referred to as the “Collateral”):

Section 2.1. Equipment. All building materials, building equipment, machinery, fixtures, apparatus, furniture and equipment and other personal property (other than motor vehicles and accessions to motor vehicles) of every kind and nature whatsoever located, including without limitation: all air conditioning, ventilating, plumbing, heating, lighting and electrical systems and apparatus; all communications equipment and intercom systems and apparatus; all typewriters, computers and other office machines and equipment, furniture, furnishings; all sprinkler equipment and apparatus, all elevators and escalators; and all machinery, equipment, engines, boilers, tools, fixtures, furniture, carpeting, tables and chairs, together with all accessories, parts and appurtenances appertaining or attached thereto, whether now owned or hereafter acquired, and all substitutions, renewals, or replacements of and additions, improvements, accessions and accumulations to any and all thereof, together with all the rents, income, revenues, issues, proceeds, profits and avails arising therefrom or in connection therewith;

Section 2.2. Receivables. Receivables, whether now existing or hereafter arising, and however evidenced or acquired, or in which the Company now has or hereafter acquires any rights and all rights of the Company to any Underlying Collateral granted by an Account Debtor in connection with any Receivable owing by it to the Company;

Section 2.3. Pledged Collateral. The Pledged Collateral;

Section 2.4. General Intangibles. General intangibles of the Company, including, without limitation, tax refunds, rights with respect to trademarks, service marks, trade names, patents, copyrights, trade-secrets information and rights to prevent others from doing acts that constitute unfair competition with or misappropriation of property of the Company including, without limitation, any sums (net of expenses) that the Company may receive arising out of any claim for infringement of its rights in any patent, copyright, trademark, trade name, trade secret or other proprietary right and all rights of the Company under contracts to enjoy performance by others or to be entitled to enjoy rights granted by others, including, without limitation, any licenses (to the extent permitted by law);

Section 2.5. Investment Property. All Investment Property, whether now owned or existing or hereafter created, acquired or arising, or in which the Company now has or hereafter acquires any rights (the term “Investment Property” means and includes all investment property and any other securities (whether certificated or uncertificated), security entitlements, securities

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accounts, commodity contracts and commodity accounts, including all substitutions and additions thereto, all dividends, distributions and sums distributable or payable from, upon, or in respect of such property, and all rights and privileges incident to such property, but excludes the Pledged Collateral);

Section 2.6. Records and Cabinets. Supporting evidence and documents relating to any of the above-described property, including without limitation, written applications, credit information, account cards, payment records, correspondence, delivery and installation certificates, invoice copies, delivery receipts, notes and other evidences of indebtedness, insurance certificates and the like, together with all books of account, data processing records, computer software and licenses to use the same, ledgers and cabinets in which the same are reflected or maintained, all whether now existing or hereafter arising;

Section 2.7. Partnership Interests. (i) All right, title and interest of the Company, whether now owned or hereafter acquired, in all partnerships or limited liability companies, including, but not limited to, those set forth on Schedule II hereto (collectively, the “Partnerships”), (ii) any and all payments or distributions of whatever kind or character and whether in cash or other property, at any time made, owing or payable to the Company in respect of or on account of its present or hereafter acquired interest in the Partnerships, whether due or to become due and whether representing profits, distributions pursuant to complete or partial liquidation or dissolution, repayment of capital contributions or otherwise, and the right to receive, receipt for, use and enjoy all such payments and distributions, and all proceeds thereof, in every case whether now arising or hereafter acquired or arising, and (iii) all proceeds of any of the foregoing (all of the foregoing rights, interests, properties and privileges assigned in and in which a security interest is granted pursuant to this §2.7 being hereafter collectively called the “Partnership Interests”);

Section 2.8. Additional Property. All property and rights, if any, which are by the express provisions of this Agreement required to be subjected to the lien hereof and any additional property and rights that may from time to time hereafter, by writing of any kind, be subjected to the lien hereof by the Company or by anyone acting at the direction or as an agent of the Company; and

Section 2.9. Other Proceeds and Products. All proceeds and products of the foregoing and all insurance of the foregoing and proceeds thereof, whether now existing or hereafter arising.

TO HAVE AND TO HOLD the Collateral, WITH POWER OF SALE and right of entry and possession, unto the Security Trustee, its successors and assigns, forever; IN TRUST NEVERTHELESS, upon the terms and trust herein set forth, for the equal and proportionate benefit, security and protection of all present and future holders of the Senior Notes outstanding hereunder from and after the issuance of the Senior Notes, without preference, priority or distinction of any Senior Note over any other Senior Note by reason of series, priority of time of issue, sale, negotiation, time of any extensions of credit evidenced thereby, date of maturity thereof or otherwise for any cause whatsoever and, on a senior subordinated basis as set forth

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herein and in the Senior Subordinated Note Agreement, for the equal and proportionate benefit, security and protection of all present and future holders of the Senior Subordinated Notes outstanding hereunder from and after the issuance of the Senior Subordinated Notes, without preference, priority or distinction of any Senior Subordinated Note over any other Senior Subordinated Note by reason of series, priority of time of issue, sale, negotiation, date of maturity thereof or otherwise for any cause whatsoever; provided always, however, that these presents are upon the express condition that if the Company shall irrevocably pay or cause to be irrevocably paid all the Secured Indebtedness and all obligations to extend Senior Indebtedness have expired or otherwise terminated, then these presents and the estate hereby granted and conveyed shall cease and this Agreement shall become null and void; otherwise this Agreement shall remain in full force and effect.

SECTION 3. COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company hereby covenants with, and represents and warrants to, the Security Trustee and for the benefit of the holders of the Notes from time to time that:

Section 3.1. Location of Collateral. The Collateral (other than the Underlying Collateral and the Pledged Collateral) and the books and records relating thereto are in the Company’s possession at the offices and facilities owned or leased by the Company set forth in Schedule III hereto. Not less than ten days before the opening of any additional business location which would require the filing of an additional financing statement in accordance with the Uniform Commercial Code in order to perfect the security interest of the Security Trustee in the Collateral, any change in the business location where the Collateral and the books and records relating thereto are located and/or maintained which would require the filing of an additional financing statement in accordance with the Uniform Commercial Code in order to perfect the security interest of the Security Trustee in the Receivables or any other Collateral, the Company will deliver to the Security Trustee a supplement hereto amending Schedule III to include such business location, together with evidence of the filing of financing statements or other notices of the security interest hereof and an opinion of the Company’s counsel responsive to the requirements of §3.8 hereof. On or before the fifth day of every December of every year, the Company will deliver to the Security Trustee a supplement hereto amending Schedule III to include any additional business locations not previously reflected in a supplement hereto.

Section 3.2. Warranty of Title. The Company is the lawful owner of the Collateral (other than the Underlying Collateral) and has the sole right and lawful authority to deliver this Agreement. The Collateral (other than the Underlying Collateral) and every part thereof is, on the Closing Date, free and clear of all Liens, except the Lien of this Agreement and will be free and clear of all Liens, except the Lien of this Agreement and the other Liens of the character described in clauses (e), (f), (g) and (h) of Section 5.11 of the Senior Note Agreements and the Senior Subordinated Note Agreement and in clauses (e), (f), (g) and (h) of Section 8.11 of the Revolving Credit Agreement, and the Company will warrant and defend the Collateral (other than the Underlying Collateral) against any claims and demands of all Persons at any time claiming the same or any interest therein adverse to the Security Trustee.

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

Section 3.3. No Alienation of Collateral. Except as permitted by the provisions of Section 5.13 of the Senior Note Agreements and the Senior Subordinated Note Agreement and Section 8.13 of the Revolving Credit Agreement, the Company will not, without the Security Trustee’s prior written consent, sell, assign, mortgage, lease or otherwise dispose of the Collateral or any interest therein.

Section 3.4. Removal of Collateral. The Company will not remove the Collateral and/or the books and records relating thereto from the locations set forth in Schedule III hereto (i) without complying with §3.1 hereof or (ii) without the Security Trustee’s prior written consent (provided that the Company may move items of Collateral among such locations). The Company will at all times allow the Security Trustee, the holders of the Notes and their representatives free access to, and right of inspection of, the Collateral.

Section 3.5. Compliance with Leases. The Company will comply with the terms and conditions of any leases covering the premises wherein the Collateral is located and any orders, ordinances, laws or statutes of any city, state or other governmental entity, department or agency having jurisdiction with respect to such premises or the conduct of business thereon unless the failure to so comply will not, individually or in the aggregate, have a material adverse effect on such Collateral or impair the rights or interests of the Company or the Security Trustee therein.

Section 3.6. Protection of Collateral. At any time and from time to time, the holder of any Notes may, at its option, or the Security Trustee may, at the direction of the holders of the Notes, discharge any taxes, or other Liens at any time levied or placed on the Collateral which are due and unpaid and (A) which are not being contested in good faith by appropriate actions or proceedings which will prevent the forfeiture or sale of the Collateral or any material interference with the use thereof or (B) for which the Company has not set aside on its books, reserves adequate in accordance with GAAP with respect thereto, and such parties may pay for the maintenance and preservation of the Collateral, including the purchasing of insurance therefor to the extent required to be maintained by the Company pursuant to Section 5.2 of the Senior Note Agreements and the Senior Subordinated Note Agreement and Section 8.2 of the Revolving Credit Agreement and not so maintained, and the Company will immediately reimburse the Security Trustee or such holder on demand for any payment made or any expense incurred by the Security Trustee or such holder pursuant to the foregoing authority with interest at a rate per annum equal to the higher of (i) 10.5% and (ii) the Corporate Base Rate plus 2%. All such expenses and payments shall have the benefit of and be secured by the security interest herein granted, and the Security Trustee is authorized to charge any depository account of the Company maintained with the Security Trustee or any holder of the Notes for the amount of such expenses and payments.

Section 3.7. Further Assurances. The Company agrees to execute and deliver to the Security Trustee such further agreements and assignments or other instruments and to do all such other things as the Security Trustee may deem necessary or appropriate to assure the Security Trustee its first priority security interest hereunder, including such financing statement or statements or amendments thereof or supplements thereto or other instruments as the Security Trustee may from time to time reasonably require to perfect, and continue the perfection of, the

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

security interest in the Collateral contemplated by this Agreement. The Company hereby agrees that, to the extent permitted by applicable law, a carbon, photographic or other reproduction of this Agreement or any such financing statement is sufficient for filing as a financing statement by the Security Trustee without notice thereof to the Company wherever the Security Trustee in its sole discretion desires to file the same. The Security Trustee shall, when an Event of Default shall have occurred and be continuing, or at such other time pursuant to §4 or §5, have the right to take physical possession of any and all of the Collateral and to maintain such possession on the Company’s premises or, if possible, to remove the Collateral or any part thereof to such other places as the Security Trustee may desire. If the Security Trustee exercises its right to take possession of the Collateral, the Company shall, upon the Security Trustee’s demand, if possible, assemble the Collateral and make it available to the Security Trustee at a place designated by the Security Trustee. The Company shall at its expense perform any and all other steps reasonably requested by the Security Trustee to preserve and protect the first priority security interest hereby granted in the Collateral. If any Collateral is in the possession or control of any of the Company’s agents or processors while a Default or an Event of Default shall have occurred and be continuing, the Company agrees (i) to notify such agents or processors in writing of the Security Trustee’s security interest therein, and (ii) upon the Security Trustee’s request instruct them to hold all such Collateral for the Security Trustee’s account and subject to the Security Trustee’s instructions. The Company agrees to mark its books and records to reflect the security interest of the Security Trustee in the Collateral.

Section 3.8. Maintenance of Lien; Recording; Opinions of Counsel. (a) The Company will, at its expense, take all necessary action to maintain and preserve the first and prior perfected lien of this Agreement (including, without limitation, the filing of all financing statements or similar notices thereof if and to the extent permitted or required by applicable law) so long as any Notes are outstanding.

(b) The Company will, forthwith after the execution and delivery of this Agreement and thereafter from time to time, cause this Agreement (and all financing statements, continuation statements or similar notices thereof if and to the extent permitted or required by applicable law) to be filed, registered and recorded in such manner and in such places as may be required by law in order to publish notice of and fully to protect the first lien of the Security Trustee in and to the Collateral; and from time to time will perform or cause to be performed any other act as provided by law and will execute or cause to be executed any and all further instruments that may be required for such publication and protection or requested by any Noteholder. With respect to any Investment Property held by a securities intermediary, commodity intermediary, or other financial intermediary of any kind, at the Security Trustee’s request, acting at the direction of the holders of the Notes, the Company shall execute and deliver, and shall cause any such intermediary to execute and deliver, an agreement among the Company, the Security Trustee and such intermediary in form and substance reasonably satisfactory to the Noteholders which provides, among other things, for the intermediary’s agreement that, upon notice by the Security Trustee that an Event of Default has occurred and is continuing, it shall comply with entitlement orders, and apply any value distributed on account of any Investment Property maintained in an account with such intermediary, as directed by the Security Trustee without further consent of the Company.

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

(c) The Company agrees at its own expense to furnish to the Security Trustee promptly after the execution and delivery of any supplement or amendment hereto or any continuation statement, an opinion of counsel satisfactory to the Security Trustee (who may be independent counsel to the Company) stating that in the opinion of such counsel, such supplement or amendment to this Agreement (or a financing statement, continuation statement or similar notice thereof if and to the extent required by applicable law) or such continuation statement, as the case may be, has been properly recorded or filed for record in all public offices in which such recording or filing is necessary to perfect the Lien provided by this Agreement as a valid Lien and security interest in the Collateral.

Section 3.9. Guaranty and Security Agreement Supplements. The Company hereby covenants and agrees that, within 30 days after any Person becomes a Restricted Subsidiary, it will (i) deliver all of the certificates or other instruments evidencing the capital stock, partnership interests, membership interests or other equity interests of such Restricted Subsidiary (except the Company will transfer and deliver only 65% of the capital stock of the Insurance Subsidiary) and all other items constituting Pledged Collateral, with all such certificates or other instruments duly endorsed in blank or accompanied by an assignment or assignments sufficient to transfer title thereto, to the Security Trustee to be held in pledge pursuant to the terms hereof as part of the Pledged Collateral, together with an amended Schedule I and, if applicable, Schedule II, hereto or to the Subsidiary Security Agreement, as the case may be, describing such additional Pledged Shares and, if applicable, Partnership Interests, and (ii) cause such Restricted Subsidiary (other than the Insurance Subsidiary) to enter into a Guaranty Supplement to each Subsidiary Guaranty Agreement substantially in the form of Exhibit A thereto and a supplement to the Subsidiary Security Agreement substantially in the form of Exhibit A thereto, together with such items described in §3.8 hereof as the Security Trustee or any Noteholder may reasonably request.

Section 3.10. Note Register. The Company will, forthwith after the execution and delivery of this Agreement, provide a copy of the Note Register to the Security Trustee. The Company agrees to promptly notify the Security Trustee of any changes to such Note Register.

SECTION 4. SPECIAL PROVISIONS RELATING TO RECEIVABLES.

Section 4.1. Representations and Warranties. As of the time any Receivable of the Company becomes subject to the security interest provided for hereby, the Company shall be deemed to have warranted as to such Receivables that:

(a) Such Receivable and all papers and documents relating thereto are genuine and in all respects what they purport to be;

(b) Such Receivable is legal, valid and subsisting;

(c) The amount of such Receivable represented as owing is the correct amount actually and unconditionally owing, is not disputed and is not subject to any set-offs, credits, deductions or countercharges;

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World Acceptance Corporation Amended and Restated Security Agreement,

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(d) Such Receivable has been created, and is, in all respects in compliance with applicable state and federal lending laws and will continue to be in compliance with such laws;

(e) The Company has no knowledge or reason to know of any fact which would impair the collectibility of such Receivable;

(f) All of the Company’s procedures, requirements and conditions and all federal and state laws applicable to the making of the loans related to such Receivable and the creation of such Receivable have been complied with;

(g) To the best knowledge of the Company, the Account Debtor on such Receivable and other obligors had legal capacity to enter into the transactions related to such Receivable;

(h) The form and content of each document related to such Receivable, the security related thereto, and the transactions from which it arose comply fully with any and all applicable laws, ordinances, rules and regulations, federal, state and/or local, with respect to the extension of credit and charging of interest, including without limitation, as applicable, the Federal Consumer Credit Protection Act, the Federal Fair Credit Reporting Act, the Federal Trade Commission Act, the Federal Equal Credit Opportunity Act and all federal, state and local laws related to licensing, usury, truth in lending, real estate settlement procedures, consumer protection, equal credit opportunity, fair debt collection, unfair and deceptive trade practices, rescission rights and disclosures, and with all rules and regulations thereunder, all as amended, and any disclosures required with respect to such Receivable were and will continue to be made properly and in a timely manner;

(i) To the best knowledge of the Company, such Receivable and all facts, statements or obligations contained or implicit in any application for credit or financial statement of the Account Debtor or other obligor submitted to the Company, including without limitation, the description of any Underlying Collateral securing such Receivable and the amount owing from the Account Debtor or other obligor, and the signatures of the parties are genuine, correct, true and complete;

(j) The Company has extended no credit of any kind or in any manner to the Account Debtor or other obligors in connection with the transactions from which such Receivable arose other than as indicated on and evidenced by the Company’s files related to such Receivable;

(k) To the best knowledge of the Company, each security agreement, UCC filing, title retention instruments and other document and instrument, if any, which is security for such Receivable contains a correct and sufficient description of any Underlying Collateral covered thereby and each lien or security interest which secures such Receivable is and will continue to be valid;

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

(l) Before extending credit to the Account Debtor or other obligor on such Receivable, the Company has made an adequate credit investigation of the Account Debtor or other obligor and has determined that the risk of extending such credit is satisfactory and in accordance with the standards historically observed by the Company in the conduct of its business;

(m) Any and all policies of insurance related to the property securing any obligation of the Account Debtor in connection with such Receivable and any credit life insurance, credit disability insurance, or credit unemployment insurance are in full force and effect in accordance with the terms of all agreements between the Company and the Account Debtor; and

(n) As to such Receivable, the Company was duly authorized to do business and in good standing in the jurisdiction in which such Receivable was originated and was duly licensed to originate such Receivable in such jurisdiction.

Section 4.2. Receivable Schedules. On or before the fifth day of every month, the Company shall provide the Security Trustee with a monthly consolidated report of gross Receivables created or acquired by the Company and the Restricted Subsidiaries. The Company shall provide the Security Trustee with such other relevant information as the Security Trustee may request from time to time.

Section 4.3. Collection of Receivables. (a) Unless and until a Default or an Event of Default shall have occurred and be continuing and the Company shall have received written notice from the Security Trustee not to collect the Receivables, the Company shall make collection of all Receivables of the Company and may use the same to carry on its business in accordance with sound business practice and otherwise subject to the terms hereof.

(b) At any time while a Default or an Event of Default shall have occurred and be continuing, in the event the Security Trustee requests the Company to do so:

(i) All instruments and chattel paper at any time constituting part of the Receivables of the Company (including any postdated checks) shall, upon receipt by the Company and to the extent permitted by law, be immediately endorsed to and deposited with the Security Trustee in the same form as received by the Company; and/or

(ii) The Company shall, to the extent permitted by law, instruct all account debtors to remit all payments in respect of Receivables of the Company to a lockbox to be maintained at the main post office, Chicago, Illinois, or such other single location as the Security Trustee may reasonably designate, under the sole custody and control of the Security Trustee.

(c) Except as otherwise directed by the Security Trustee, the Company shall immediately place the following legend conspicuously, on the face of each document, instrument, chattel paper and other writing evidencing the Receivables created on or after the Original Closing Date but before the Closing Date: “A SECURITY INTEREST IN THIS DOCUMENT HAS

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

BEEN GRANTED TO HARRIS TRUST AND SAVINGS BANK, AS SECURITY TRUSTEE AND SECURED PARTY, PURSUANT TO THAT CERTAIN SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST DATED AS OF DECEMBER 1, 1992.” Except as otherwise directed by the Security Trustee, the Company shall, within ten days after the Closing Date, place the following legend conspicuously, on the face of each document, instrument, chattel paper and other writing evidencing the Receivables created on or after the Closing Date: “A SECURITY INTEREST IN THIS DOCUMENT HAS BEEN GRANTED TO HARRIS TRUST AND SAVINGS BANK, AS SECURITY TRUSTEE AND SECURED PARTY, PURSUANT TO A SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST.” At any time while a Default or an Event of Default shall have occurred and be continuing, the Security Trustee or its designee may notify the Company’s customers or account debtors at any time that Receivables of the Company have been assigned to the Security Trustee or of the Security Trustee’s security interest therein and either in its own name, that of the Company or both, demand, collect (including without limitation through a lockbox analogous to that described in §4.3(b)(ii) hereof), receive, receipt for, sue for, compound and give acquittance for any or all amounts due or to become due on such Receivables, and in the Security Trustee’s discretion file any claim or take any other action or proceeding which the Security Trustee may deem necessary or appropriate to protect and realize upon the security interest of the Security Trustee in such Receivables.

(d) In the event the Security Trustee has exercised any or all of its rights under §§4.3(b) or (c) hereof, the Security Trustee may, at any time while a Default or an Event of Default shall have occurred and be continuing, cause all instruments, chattel paper, moneys or other proceeds received by the Security Trustee to be deposited, handled and administered in and through a remittance account. If a Default or an Event of Default has occurred and is continuing to the knowledge of the Security Trustee, all amounts received by the Security Trustee pursuant to the Granting Clauses hereof and all amounts held in any remittance account referred to above in this paragraph shall be held by the Security Trustee for application in the manner provided for in §7 in respect of proceeds and avails of the Collateral.

Section 4.4. Power of Attorney. Upon the occurrence and during the continuance of a Default or an Event of Default, in addition to any other powers of attorney granted herein, the Company appoints the Security Trustee, its nominee, or any other Person whom the Security Trustee may designate as the Company’s attorney-in-fact, with full power at any time and from time to time to endorse the Company’s name on any checks, notes, acceptances, money orders, drafts or other forms of payment or security that may come into the Security Trustee’s possession, upon the occurrence and during the continuance of a Default or an Event of Default, to sign the Company’s name on any invoice or bill of lading relating to any Collateral of the Company, on drafts against customers, on schedules and assignments of Collateral of the Company, on notices of assignment, and other public records, on verification of accounts and on notices to customers, to notify the post office authorities to change the address for delivery of the Company’s mail to an address designated by the Security Trustee, to receive, open and dispose of all mail addressed to the Company, to send requests for verification of Receivables of the Company to customers or account debtors, and to do all things necessary to carry out this Agreement. The Company ratifies and approves all acts of any such attorney and agrees that neither the Security Trustee nor any such attorney will be liable for any acts or omissions nor for

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

any error of judgment or mistake of fact or law other than their willful misconduct or gross negligence. The foregoing power of attorney, being coupled with an interest, is irrevocable until the Secured Indebtedness is fully and irrevocably paid and satisfied and all obligations to extend credit under the Revolving Credit Notes have expired or otherwise terminated. The Security Trustee may file one or more financing statements disclosing its security interest in any or all of the Collateral without the Company’s signature appearing thereon. The Company also hereby grants the Security Trustee a power of attorney to execute any such financing statement, or amendments and supplements to financing statements on behalf of the Company with notice thereof to the Company, which power of attorney is coupled with an interest and irrevocable until the Secured Indebtedness is fully paid and satisfied.

SECTION 5. SPECIAL PROVISIONS RELATING TO PLEDGED COLLATERAL .

Section 5.1. Delivery of Pledged Collateral; Transfer to Security Trustee. All instruments and certificates representing or evidencing the Pledged Collateral shall be delivered to and held by or on behalf of the Security Trustee for the ratable benefit of the holders of the Notes pursuant hereto and shall be in suitable form for transfer by delivery, or shall be accompanied by duly executed instruments of transfer or assignment in blank and undated, all in form and substance satisfactory to the Security Trustee. The Security Trustee shall have the right, subject to applicable law, at any time in its discretion after the occurrence of an Event of Default, to transfer to or to register in the name of the Security Trustee or any of its nominees any or all of such Pledged Collateral. Promptly after any such transfer or registration, the Security Trustee shall give notice thereof to the Company, but the failure to give such notice shall not affect any of the rights or remedies of the Security Trustee hereunder. The Security Trustee shall have the right at any time to exchange instruments or certificates representing or evidencing such Pledged Collateral for instruments or certificates of smaller or larger denominations, subject to the terms thereof.

Section 5.2. Voting Power; Payments.

(a) Voting Power. So long as an Event of Default shall not have occurred and be continuing, the Company shall have the right to exercise any and all voting or other consensual rights pertaining to the Pledged Collateral or any part thereof for all purposes not inconsistent with the terms of this Agreement, the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement, and the Company agrees that it will not exercise any such rights in any manner which is inconsistent with the terms of this Agreement, the Senior Note Agreements, the Revolving Credit Agreement and the Senior Subordinated Note Agreement; provided, however, that the Company shall not exercise or shall refrain from exercising any such right if such action would have a material adverse affect on the value of the Pledged Collateral or any part thereof; the Security Trustee (1) shall have no right to exercise such voting rights as are reserved in this §5.2(a) to the Company and (2) shall execute and deliver to the Company or cause to be executed and delivered to the Company all such proxies, powers of attorney, and other orders, and all such instruments, without recourse, as the Company may reasonably request in writing for the purpose of enabling the Company to exercise the voting rights which it is entitled to exercise under this §5.2(a).

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

(b) Payments on Default. So long as no Default or Event of Default shall have occurred and be continuing, the Company shall have the right to receive and retain all cash distributions and payments made in respect of the Pledged Collateral to the extent such payments (1) may be legally declared and paid under applicable law and (2) are not prohibited by the applicable provisions hereof and of the Senior Note Agreements, the Revolving Credit Agreement or the Senior Subordinated Note Agreement; provided, however, that any and all

(i) dividends and distributions paid or payable other than in cash in respect of, and instruments and other property received, receivable or otherwise distributed in respect of, or in exchange for, any Pledged Collateral,

(ii) dividends and other distributions paid or payable in cash in respect of any Pledged Collateral in connection with a partial or total liquidation or dissolution or in connection with a reduction of capital, capital surplus or paid-in-surplus, and

(iii) cash paid, payable or otherwise distributed in redemption of, or in exchange for, any Pledged Collateral;

shall be forthwith delivered to the Security Trustee to hold as, and such amounts so delivered shall be, Pledged Collateral and shall, if received by the Security Trustee, be received in trust for the benefit of the Security Trustee, be segregated from the other property or funds of the Company and be forthwith delivered to the Security Trustee as Pledged Collateral in the same form as so received (with all appropriate powers, authorizations, orders and documents).

(c) Voting Rights after an Event of Default and Receipt of Distributions after a Default or an Event of Default. Upon the occurrence and during the continuance of an Event of Default, all rights of the Company to exercise or refrain from exercising the voting and other consensual rights that it would otherwise be entitled to exercise pursuant to clause (a) above and, upon the occurrence and during the continuance of a Default or an Event of Default, all rights of the Company to receive the dividends and other distributions which it would otherwise be entitled to receive and retain pursuant to clause (b) above, in each such case, shall cease during the period and continuance of such Default or Event of Default, as the case may be, and all such rights shall thereupon become vested in the Security Trustee, which shall thereupon have the sole right to exercise or refrain from exercising such voting and other consensual rights, as directed in writing by the the Noteholders pursuant to §8.1 hereof, and to receive and hold as Pledged Collateral such distributions and dividends.

Section 5.3. Covenants of the Company. The Company hereby covenants and agrees as follows:

(a) Issuance of Additional Shares of Stock. The Company will not vote to enable or otherwise cause any Restricted Subsidiary to issue any shares of stock or other Securities in addition to, or to issue other securities of any nature in exchange or substitution for, the Pledged Collateral (except to qualify directors) unless such stock or other securities may be issued under the relevant provisions hereof, are pledged to the

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

Security Trustee for the ratable benefit of the holders of the Notes as part of the Pledged Collateral and the Company represents to the Security Trustee and the holders of the Notes that (i) the Company has good and marketable title to such stock or other Security, free and clear of any Lien other than the Lien hereof and (ii) such stock or other Security has been duly authorized, validly issued and is fully paid and non-assessable.

(b) Regulatory Consent. The Company will use its best efforts to obtain consent of any regulatory authority, Federal, state or local, if any, having jurisdiction over any license, franchise or other authorization granted by any governmental unit or authority, which consent may be required in connection with the transfer of the Pledged Collateral, and will cooperate fully with the Security Trustee in effecting any such transfer, including, without limitation, the execution and delivery of all applications, certificates and other documents that may be required to obtain the consent and approval or authorization of or registration or qualification with, any governmental authority, and specifically, without limitation, any application for consent to assignment of license or transfer of control necessary or appropriate under the rules and regulations of any governmental authority for approval of (1) any sale or sales of property constituting Pledged Collateral by or on behalf of the Security Trustee or (2) any assumption by the Security Trustee of voting rights or management rights in the Pledged Collateral, effected in accordance with the terms of this Agreement.

(c) Additional Pledged Collateral. If any of the Pledged Collateral, including, without limitation, any shares, notes, obligations, Securities, instruments, property or (except to the extent otherwise provided in clauses (b) and (c) in the definition of Pledged Collateral) moneys, distributions or other payments of every kind and variety referred to in clauses (a) through (c) in the definition of Pledged Collateral are received by the Company, the Company agrees forthwith to transfer and deliver the same (with the certificates or other instruments or documents evidencing or documenting any such shares, notes, obligations, interests, instruments, or other Securities duly endorsed in blank or accompanied by an assignment or assignments sufficient to transfer title thereto), to the Security Trustee to be held in pledge pursuant to the terms of this Agreement, as part of the Pledged Collateral.

(d) Schedule of Pledged Collateral. The Company will furnish to the Security Trustee from time to time statements and schedules further identifying and describing the Pledged Collateral and such other reports in connection with the Pledged Collateral as the Security Trustee may reasonably request, all in reasonable detail.

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

SECTION 6. APPLICATION OF CERTAIN MONEYS.

Section 6.1. Application if no Default or Event of Default Exists. So long as no Default or Event of Default shall have occurred and be continuing, subject to the Company’s contractual obligations to other parties (including, without limitation, the Revolving Credit Agreement), the Company shall be allowed to receive and apply the Collateral and to carry on its business in accordance with sound business practices.

Section 6.2. Application if a Default or an Event of Default Exists. If a Default or an Event of Default has occurred and is continuing, all amounts which constitute Collateral shall be paid over to the Security Trustee for application in the manner provided in §7 in respect of proceeds and avails of the Collateral.

SECTION 7. DEFAULTS AND REMEDIES.

Section 7.1. Events of Default . An “Event of Default” under the Senior Note Agreements, the Revolving Credit Agreement or the Senior Subordinated Note Agreement shall constitute an Event of Default hereunder.

Section 7.2. Security Trustee’s Rights. The Company agrees that when any Event of Default has occurred and is continuing, the Security Trustee may, subject to the provisions of §8.1, without limitation of all other rights and remedies available herein, in the Subsidiary Security Agreement, at law or in equity in such event, exercise any one or more or all, and in any order, of the remedies hereinafter set forth, it being expressly understood that no remedy herein conferred is intended to be exclusive of any other remedy or remedies; but each and every remedy shall be cumulative and shall be in addition to every other remedy given herein or now or hereafter existing at law or in equity or by statute:

(a) The Security Trustee personally, or by agents or attorneys, shall have the right (subject to compliance with any applicable mandatory legal requirements) to enter into and upon the premises of the Company and take possession of all or any part of the Collateral and to exclude the Company wholly therefrom, and having and holding the same may use, operate, manage and control the Collateral and collect and receive all earnings, revenues, issues, proceeds and income of the Collateral and every part thereof and may maintain, repair and renew the Collateral and make replacements, alterations, additions and improvements thereto or remove and dispose of any portion of the Collateral and may otherwise exercise any and all of the rights and powers of the Company in respect thereof.

(b) The Security Trustee may, if at the time such action may be lawful and always subject to compliance with any mandatory legal requirements, either with or

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

without taking possession, and either before or after taking possession, and without instituting any legal proceedings whatsoever, and having first given notice of such sale by registered mail to the Company and each holder of the Notes once at least ten days prior to the date of such sale, and any other notice which may be required by law, sell and dispose of the Collateral, or any part thereof, or interest therein, at public auction to the highest bidder, in one lot as an entirety or in separate lots, and either for cash or on credit and on such terms as the Security Trustee may determine, and at any place (whether or not it be the location of the Collateral or any part thereof) designated in the notice above referred to. Any such sale or sales may be adjourned from time to time by announcement at the time and place appointed for such sale or sales, or for any such adjourned sale or sales, without further notice, and the Security Trustee or the holder or holders of any Notes, or of any interest therein, may bid and become the purchaser at any such sale.

(c) The Security Trustee may proceed to protect and enforce this Agreement and the Notes by suit or suits or proceedings in equity, at law or in bankruptcy, and whether for the specific performance of any covenant or agreement herein contained or in execution or aid of any power herein granted; or for foreclosure hereunder, or for the appointment of a receiver or receivers for the Collateral or any part thereof, or for the recovery of judgment for the Secured Indebtedness or for the enforcement of any other proper, legal or equitable remedy available under applicable law.

Section 7.3. Waiver by Company. To the extent now or at any time hereafter enforceable under applicable law, the Company covenants that it will not at any time insist upon or plead, or in any manner whatsoever claim or take any benefit or advantage of, any stay or extension law now or at any time hereafter in force, nor claim, take nor insist upon any benefit or advantage of or from any law now or hereafter in force providing for the valuation or appraisement of the Collateral or any part thereof, prior to any sale or sales thereof to be made pursuant to any provision herein contained, or to the decree, judgment or order of any court of competent jurisdiction; nor, after such sale or sales, claim or exercise any right under any statute now or hereafter made or enacted by any state or otherwise to redeem the property so sold or any part thereof, and hereby expressly waives for itself and on behalf of each and every Person, except decree or judgment creditors of the Company acquiring any interest in or title to the Collateral or any part thereof subsequent to the date of this Agreement, all benefit and advantage of any such law or laws, and covenants that it will not invoke or utilize any such law or laws or otherwise hinder, delay or impede the execution of any power herein granted and delegated to the Security Trustee, but will suffer and permit the execution of every such power as though no such law or laws had been made or enacted.

Section 7.4. Effect of Sale. Any sale, whether under any power of sale hereby given or by virtue of judicial proceedings, shall operate to divest all right, title, interest, claim and demand whatsoever, either at law or in equity, of the Company in and to the property sold and shall be a perpetual bar, both at law and in equity, against the Company, its successors and assigns, and against any and all persons claiming the property sold or any part thereof under, by or through the Company, its successors or assigns.

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Section 7.5. Application of Sale and Other Proceeds. The Security Trustee shall give at least one day prior written notice to each holder of a Note then outstanding of each date (the “Application Date”) on which the proceeds and/or avails of any sale of the Collateral, or any part thereof, shall be applied, and on such Application Date, or as soon thereafter as may be practical, the proceeds and the avails of any remedy hereunder then available to the Security Trustee shall be irrevocably paid to and applied as follows:

First, to the payment of costs and expenses of foreclosure or suit, if any, and of such sale, and of all proper expenses, liability and advances, including reasonable legal and administrative expenses and attorneys’ fees, incurred or made hereunder by the Security Trustee and of all taxes, assessments or Liens superior to the lien of these presents, except any taxes, assessments or other superior lien subject to which said sale may have been made;

Second, to the irrevocable payment of the whole amount then due upon the Senior Notes, whether by acceleration or otherwise, for principal, interest and premium, if any; and in case such proceeds shall be insufficient to pay in full the whole amount so due, owing or unpaid upon the Senior Notes, then ratably according to the aggregate of such principal and the accrued and unpaid interest and premium, if any, with application on each Senior Note to be made, first, to unpaid interest thereon, second, to the unpaid principal thereof, and third, to unpaid premium (including, but not limited to, any Make-Whole Amount and any other amounts due and owing pursuant to Section 2.10 of the Revolving Credit Agreement), if any, thereon; such application to be made upon presentation of the several Senior Notes, and the notation thereon of the payment, if partially paid, or the surrender and cancellation thereof, if fully paid;

Third, on a pro rata basis without any order of priority, to the irrevocable payment of (i) the amounts payable by the Company under the Revolving Credit Agreement in the form of fees pursuant to Sections 3.1 and 3.3 thereof as such sections were in effect on the Closing Date or as amended or revised after the Closing Date but not in excess of the aggregate amount of the fees payable pursuant to Sections 3.1 and 3.3 as in effect on the Closing Date, (ii) the amounts payable under the Revolving Credit Agreement for increased costs, taxes and indemnification as described in Section 10.3, Section 12.3 and paragraph (b) of Section 12.12, respectively, of the Revolving Credit Agreement, (iii) the amounts payable by the Company under the Senior Note Agreements pursuant to the final paragraph of Section 8.4 of the Senior Note Agreements and §8.13 (in each case, except to the extent covered by clause first above), and (iv) the first $2,500,000 of all other costs, claims, expenses and fees (including trustee’s fees and attorneys’ fees) which become payable by the Company pursuant to or arising out of the Senior Note Agreements, the Revolving Credit Agreement or this Agreement, in each case, with respect to the Senior Notes;

Fourth, to the irrevocable payment of the whole amount then due upon the Senior Subordinated Notes, whether by acceleration or otherwise, for principal, interest and premium, if any; and in case such proceeds shall be insufficient to pay in full the whole

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amount so due, owing or unpaid upon the Senior Subordinated Notes, then ratably according to the aggregate of such principal and the accrued and unpaid interest and premium, if any, with application on each Senior Subordinated Note to be made, first, to unpaid interest thereon, second, to the unpaid principal thereof, and third, to unpaid premium, if any, thereon; such application to be made upon presentation of the several Senior Subordinated Notes, and the notation thereon of the payment, if partially paid, or the surrender and cancellation thereof, if fully paid;

Fifth, to the irrevocable payment of any other Secured Indebtedness, including, without limitation, (i) all other expenses, fees and amounts owing to the holder of any Senior Note and not covered by the immediately preceding clauses first through fourth and (ii) all expenses, fees and other amounts owing to the holder of any Senior Subordinated Note; and

Sixth, to the irrevocable payment of the surplus, if any, to the Company, its successors and assigns, or to whomsoever may be lawfully entitled to receive the same.

The proceeds and/or avails of the Collateral shall be applied as set forth above notwithstanding the time or order of advance of any funds secured by any such Collateral or any other priority provided by law or otherwise. By accepting the benefits of this Agreement, each of the holders of the Notes agrees that it will not initiate or prosecute, or encourage any other person to initiate or prosecute, any claim, action or other proceeding challenging the enforceability of the claims of the holders of the Notes or challenging the enforceability of any liens or security interests in assets securing the Notes and the other obligations and liabilities relating thereto, in each case, created or incurred in accordance with the terms of this Agreement and the Subsidiary Security Agreement.

Section 7.6. Discontinuance of Remedies. In case the Security Trustee shall have proceeded to enforce any right under this Agreement by foreclosure, sale, entry or otherwise, and such proceedings shall have been discontinued or abandoned for any reason or shall have been determined adversely, then and in every such case the Company, the Security Trustee and the holders of the Notes shall be restored to their former positions and rights hereunder with respect to the property subject to the lien and security interest created under this Agreement.

Section 7.7. Cumulative Remedies. No delay or omission of the Security Trustee or of the holder of any Note to exercise any right or power arising from any default, shall exhaust or impair any such right or power or prevent its exercise during the continuance of such default. No waiver by the Security Trustee or the holder of any Note of any such default, whether such waiver be full or partial, shall extend to or be taken to affect any subsequent default, or to impair the rights resulting therefrom except as may be otherwise provided therein. No remedy hereunder is intended to be exclusive of any other remedy but each and every remedy shall be cumulative and in addition to any and every other remedy given hereunder or otherwise existing; nor shall the giving, taking or enforcement of any other or additional security, collateral or guaranty for the payment of the Secured Indebtedness operate to prejudice, waive or affect the security of this Agreement or any rights, powers or remedies hereunder, nor shall the Security

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Trustee or the holder of any Note be required to first look to, enforce or exhaust such other or additional security, collateral or guaranties.

SECTION 8. THE SECURITY TRUSTEE.

The Security Trustee accepts the trusts hereunder and agrees to perform the same, but only upon the terms and conditions hereof, including the following, to all of which the Company and the respective holders of the Notes at any time outstanding by their acceptance thereof agree:

Section 8.1. Duties of Security Trustee. (a) The Security Trustee undertakes (i) except while an Event of Default actually known to the Security Trustee shall have occurred and be continuing, to perform such duties and only such duties as are specifically set forth in this Agreement, or in any direction given pursuant to this Agreement, and (ii) while an Event of Default actually known to the Security Trustee shall have occurred and be continuing, (A) to exercise such of the rights and powers as are vested in it by this Agreement and subject to §8.1(b), to use the same degree of care and skill in their exercise as an ordinary prudent man would exercise or use under the circumstances in the conduct of his own affairs and (B) to conduct any sale or disposition of the Collateral pursuant to §7.2 in a commercially reasonable manner.

The Security Trustee upon receipt of instruments or notices furnished to the Security Trustee pursuant to the provisions of this Agreement shall furnish copies of the same to the holders of the Notes.

(b) In the event that the Security Trustee shall have actual knowledge of an Event of Default, the Security Trustee shall give prompt written notice of such Event of Default to each holder of a Note. Subject to the terms of §8.2(h), in accordance with written instructions received from the holders of at least a majority of the Aggregate Principal Amount of the Outstanding Notes, the Security Trustee shall take such action or refrain from taking such action as the Security Trustee shall be directed in writing by such holders. If the Security Trustee shall not have received written instructions as above provided within twenty (20) days after mailing notice of such Event of Default to the holders, the Security Trustee may, subject to instructions received pursuant to the preceding sentence, take such action, or refrain from taking such action, but shall be under no duty to take or refrain from taking any action, with respect to such Event of Default, as it shall determine advisable in the best interests of the holders of the Notes.

(c) The Security Trustee shall not have any duty or obligation to manage, control, use, sell, dispose of or otherwise deal with the Collateral, or, to otherwise take or refrain from taking any action under, or in connection with, this Agreement, except as expressly provided by the terms of this Agreement or expressly provided in written instructions received pursuant to this Agreement.

(d) Except if it is herein otherwise expressly provided that no such request is required, the Security Trustee shall not be under any obligation to take any action which is discretionary with the Security Trustee or otherwise requires judgment to be made by the Security Trustee

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under the provisions hereof, except on written request by the holders of the Notes or by the requisite portion thereof as expressly provided herein.

Section 8.2. Security Trustee’s Liability. No provision of this Agreement (except to the extent provided in §8.13 hereof) shall be construed to relieve the Security Trustee from liability for its own negligent action, negligent failure to act, or its own willful misconduct, except that:

(a) unless an Event of Default actually known to the Security Trustee shall have occurred and be continuing, the Security Trustee shall not be liable except for the performance of such duties as are specifically set forth in this Agreement and no implied covenants or obligations shall be read into this Agreement against the Security Trustee but the duties and obligations of the Security Trustee shall be determined solely by the express provisions of this Agreement; and

(b) in the absence of bad faith on the part of the Security Trustee, the Security Trustee may rely upon the authenticity of, and the truth of the statements and the correctness of the opinions expressed in, and shall be protected in acting upon, any resolution, officer’s certificate, opinion of counsel (which counsel shall be independent of the Company, any Affiliate thereof and the holders of the Notes), Note, request, notice, consent, waiver, order, signature guaranty, notarial seal, stamp, acknowledgment, verification, appraisal, report, stock certificate, or other paper or document believed by the Security Trustee to be genuine and to have been signed, affixed or presented by the proper party or parties; and

(c) in the absence of bad faith on the part of the Security Trustee, whenever the Security Trustee, or any of its agents, representatives, experts or counsel (which counsel shall be independent of the Company, any Affiliate thereof and the holders of the Notes), shall consider it necessary or desirable that any matter be proved or established, such matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by an officer’s certificate; provided, however, that the Security Trustee, or such agent, representative, expert or counsel, may require such further and additional evidence and make such further investigation as it or they may consider reasonable; and

(d) the Security Trustee may consult with counsel (which counsel shall be independent of the Company, any Affiliate thereof and the holders of the Notes) and the advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered hereunder in good faith and in accordance with such advice or opinion of counsel; and

(e) the Security Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with any direction or request of the holders of Notes or the requisite portion thereof as expressly provided herein; and

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(f) the Security Trustee shall not be liable for any error of judgment made in good faith by an officer of the Security Trustee unless it shall be proved that the Security Trustee was negligent in ascertaining the pertinent facts; and

(g) the Security Trustee shall not be deemed to have knowledge of any Default or Event of Default unless and until an officer of the Corporate Trust Department of the Security Trustee who customarily handles corporate trusts or such other Person employed by the Security Trustee who has primary responsibility for the transactions contemplated hereby shall have actual knowledge thereof or the Security Trustee shall have received written advice thereof from the holder of any Note; and

(h) whether or not an Event of Default shall have occurred, the Security Trustee shall not be under any obligation to take or refrain from taking any action under this Agreement which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it by the security afforded to it by the terms of this Agreement, unless and until it is requested in writing so to do by one or more holders of Notes outstanding hereunder and furnished, from time to time as it may require, with reasonable security and indemnity.

Section 8.3. No Responsibility of Security Trustee for Recitals. The recitals and statements contained herein and in the Notes shall be taken as the recitals and statements of the Company, and the Security Trustee assumes no responsibility for the correctness of the same, nor shall the Security Trustee have any responsibility for or any liability with respect to any disclosure, warranty, representation or concealment or failure to disclose in connection with the offering, solicitation, sale or distribution of the Notes by the Company or by any other Person.

The Security Trustee makes no representation as to the validity or sufficiency of this Agreement, or of the Notes secured hereby, the security hereby or thereby afforded, the title of the Company to or the existence of the Collateral or the descriptions thereof, or the filing or recording or registering of this Agreement or any other document.

The Security Trustee shall not be concerned with or accountable to any Person for the use or application of any deposited moneys which shall be released or withdrawn in accordance with the provisions of this Agreement or of any property or Securities or the proceeds thereof which shall be released from the lien and security interest hereof in accordance with the provisions of this Agreement.

Section 8.4. Certain Limitations on Security Trustee’s Rights to Compensation and Indemnification. Except to the extent otherwise expressly provided herein the Security Trustee shall have no right against the holder of any Note for the payment of compensation for its services hereunder or any expenses or disbursements incurred in connection with the exercise and performance of its powers and duties hereunder or any indemnification against liabilities which it may incur in the exercise and performance of such powers and duties but on the contrary, shall look solely to the Company for such payment and indemnification which the Company hereby agrees to make, and the Security Trustee shall have no lien on or security

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interest in the Collateral as security for such compensation, expenses, disbursements and indemnification except to the extent provided for in §7.5.

Section 8.5. Status of Moneys Received. (a) All moneys received by the Security Trustee shall, together with any interest thereon, until used or applied as herein provided, be held in trust for the purposes for which they were received, but (except as herein otherwise provided with respect to the funds referred to in paragraph (b) of this Section) need not be segregated in any manner from any other moneys, except to the extent required by law, and may be deposited by the Security Trustee under such general conditions as may be prescribed by law in the Security Trustee’s general banking department, and the Security Trustee shall be under no liability for interest (other than any interest accrued pursuant to clause (b) of this §8.5) on any moneys received by it hereunder.

(b) The Security Trustee shall invest and reinvest any funds from time to time held by the Security Trustee in direct obligations of the United States of America or obligations for which the full faith and credit of the United States is pledged to provide for the payment of principal and interest, maturing not more than 90 days from the date of such investment.

Section 8.6. Resignation of Security Trustee. The Security Trustee may resign without cause and be discharged from the trusts created hereby by delivering notice thereof, by registered or certified mail postage prepaid to the Company and all holders of the Notes at the time outstanding. Such resignation shall take effect immediately upon the appointment of a successor Security Trustee as provided in §§8.8 and 8.9.

Section 8.7. Removal of Security Trustee. The Security Trustee may be removed at any time, for or without cause, by an instrument or instruments in writing executed by the holders of a majority of the Aggregate Principal Amount of the Outstanding Notes and delivered to the Security Trustee with a copy to the Company, specifying the removal and the date when it shall take effect provided, however, that no such removal shall be effective hereunder unless and until a successor security trustee shall have been appointed and shall have accepted such appointment as provided in §§8.8 and 8.9.

Section 8.8. Appointment of Successor Security Trustee. In case at any time the Security Trustee shall resign or be removed or become incapable of acting, a successor Security Trustee may be appointed by the holders of a majority of the Aggregate Principal Amount of the Outstanding Notes, by an instrument or instruments in writing executed by such Noteholders and filed with such successor Security Trustee and the Company.

Until a successor Security Trustee shall be so appointed by the Noteholders, the Company shall appoint a successor Security Trustee to fill such vacancy, by an instrument in writing executed by the Company and delivered to the successor Security Trustee. If all or substantially all of the Collateral shall be in the possession of one or more receivers, trustees, liquidators or assignees for the benefit of creditors, then such receivers, trustees, custodians, liquidators or assignees may, by an instrument in writing delivered to the successor Security Trustee, appoint a successor Security Trustee. Promptly after any such appointment, the Company, or any such

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receivers, trustees, custodians, liquidators or assignees, as the case may be, shall give notice thereof by first class mail postage prepaid to each holder of the Notes at the time outstanding.

Any successor Security Trustee so appointed by the Company, or such receivers, trustees, custodians, liquidators or assignees, shall immediately and without further act be superseded by a successor Security Trustee appointed by the holders of a majority in Aggregate Principal Amount of the Outstanding Notes.

If a successor Security Trustee shall not be appointed pursuant to this Section within thirty days after notice of the resignation or removal of the retiring Security Trustee, the holder of any Note or such retiring Security Trustee (unless the retiring Security Trustee is being removed) may apply to any court of competent jurisdiction to appoint a successor Security Trustee, and such court may thereupon, after such notice, if any, as it may consider proper, appoint a successor Security Trustee.

Section 8.9. Succession of Successor Security Trustee. Any successor Security Trustee appointed hereunder shall execute, acknowledge and deliver to the Company and the predecessor Security Trustee an instrument accepting such appointment, and thereupon such successor Security Trustee, without any further act, deed, conveyance or transfer, shall become vested with the title to the Collateral, and with all the rights, powers, trusts, duties and obligations of the predecessor Security Trustee in the trust hereunder, with like effect as if originally named as Security Trustee herein.

Upon the request of any such successor Security Trustee, however, the Company and the predecessor Security Trustee shall execute and deliver such instruments of conveyance and further assurance and do such other things as may reasonably be required for more fully and certainly vesting and confirming in such successor Security Trustee its interest in the Collateral and all such rights, powers, trusts, duties and obligations of the predecessor Security Trustee hereunder, and the predecessor Security Trustee shall also assign and deliver to the successor Security Trustee any property subject to the lien and security interest of this Agreement which may then be in its possession.

Section 8.10. Eligibility of Security Trustee. The Security Trustee shall be a state or national bank or trust company in good standing, organized under the laws of the United States of America or of any state thereof, having a capital, surplus and undivided profits aggregating at least $500,000,000 and whose certificates of deposit are accorded a rating of A or better by S&P and Moody’s or, if S&P and Moody’s are no longer rating such banks, then by any other nationally recognized credit rating agency of similar standing or a guaranty of its obligations hereunder from such a bank or trust company or holding company in good standing, organized under the laws of the United States of America or of any State thereof, having a capital, surplus and undivided profits aggregating at least $500,000,000 and whose certificates of deposit are accorded a rating of A or better by S&P and Moody’s or, if S&P and Moody’s are no longer rating such banks, then by any other nationally recognized credit rating agency of similar standing, if there be such a bank or trust company willing and able to accept such trust upon reasonable and customary terms.

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In case the Security Trustee shall cease to be eligible in accordance with the provisions of this Section, the Security Trustee shall resign immediately in the manner and with the effect specified in §8.6.

Section 8.11. Successor Security Trustee by Merger. Any corporation into which the Security Trustee may be merged or with which it may be consolidated, or any corporation resulting from any merger or consolidation to which the Security Trustee shall be a party, or any state or national bank or trust company in any manner succeeding to the corporate trust business of the Security Trustee as a whole or substantially as a whole, if eligible as provided in §8.10, shall be the successor of the Security Trustee hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything to the contrary contained herein notwithstanding.

Section 8.12. Co-Trustees. At any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Collateral may at the time be located, the Company and the Security Trustee jointly shall have power and shall execute and deliver all instruments, to appoint one or more persons approved by the Security Trustee, to act as co-trustee, or co-trustees, jointly with the Security Trustee, or separate trustee or separate trustees, of all or any part of the Collateral, and to vest in such person or persons in such capacity, such interest in the Collateral or any part thereof, and such rights, powers, duties, trusts or obligations as the Company and the Security Trustee may consider necessary or desirable. If the Company shall not have joined in such appointment within 15 days after the receipt by it of a request so to do, or in case an Event of Default shall have occurred and be continuing, the Security Trustee alone shall have power to make such appointment if the Security Trustee reasonably believes such appointment is necessary or desirable to carry out the transactions contemplated hereby.

Section 8.13. Compensation and Reimbursement. The Company agrees:

(a) to pay to the Security Trustee all of its out-of-pocket expenses in connection with the preparation, execution and delivery of this Agreement and the transactions contemplated hereby, including but not limited to the reasonable charges and disbursements of its special counsel;

(b) to pay to the Security Trustee from time to time reasonable compensation for all services rendered by it hereunder;

(c) except as otherwise expressly provided herein, to reimburse the Security Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Security Trustee in accordance with any provision of this Agreement (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its gross negligence or willful misconduct; and

(d) to indemnify the Security Trustee for, and to hold it harmless against, any loss, liability or expense incurred without gross negligence or willful misconduct on its

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part, arising out of or in connection with the acceptance or administration of the Agreement, including, but not limited to, the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder, and any loss, liability, expense or claim arising out of its possession, management, control, use or operation of the Collateral.

SECTION 9. SUPPLEMENTS; WAIVERS.

Section 9.1. Supplemental Security Agreements Without Noteholder Consent. The Company and the Security Trustee from time to time and at any time, subject to the restrictions in this Agreement contained, may enter into an agreement or agreements supplemental hereto, which thereafter shall form a part hereof, for any one or more or all of the following purposes:

(a) to add to the covenants and agreements to be observed by, and to surrender any right or power reserved to or conferred upon the Company;

(b) to subject to the lien and security interest of this Agreement additional property hereafter acquired by the Company and intended to be subjected to the lien and security interest of this Agreement and to correct and amplify the description of any property subject to the lien and security interest of this Agreement; and

(c) to permit the qualification of this Agreement under the Trust Indenture Act of 1939, as amended, or any similar Federal statute hereafter in effect, except that nothing herein contained shall permit or authorize the inclusion of the provisions referred to in Section 316(a)(2) of said Trust Indenture Act of 1939 or any corresponding provision in any similar Federal statute hereafter in effect;

and the Company covenants to perform all requirements of any such supplemental agreement. No restriction or obligation imposed upon the Company may, except as otherwise provided in this Agreement, be waived or modified by any such supplemental agreement.

Section 9.2. Waivers and Consents by Noteholders; Supplemental Security Agreements with Noteholders’ Consent. (a) Upon the waiver or consent of (x) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Secured Notes, (y) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Revolving Credit Notes, and, if any of the waivers or supplemental agreements described below relate to Collateral involving assets of the Company and its Restricted Subsidiaries which constitute a “substantial part” (as defined below), (z) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes, the Company and the Security Trustee may enter into an agreement or agreements supplemental hereto for the purpose of waiving, adding, changing or eliminating any provisions of this Agreement or of any agreement supplemental hereto or modifying in any manner the rights and obligations of the holders of the Notes and the Company; provided, however, that no such waiver or supplemental agreement shall (A) impair or affect the right of any holder to receive payments or prepayments

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of the principal of and payments of the interest and premium, if any, on its Note, as therein and herein provided, without the consent of such holder, (B) permit the creation of any lien and security interest with respect to any of the Collateral, without the consent of the holders of all the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of the Company and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding, (C) except as otherwise provided in §10.4, effect the deprivation of the holder of any Note of the benefit of the lien and security interest of this Agreement upon all or any part of the Collateral without the consent of the holders of all of the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of the Company and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding, (D) reduce the aforesaid percentages of the aggregate principal amount of Notes, the holders of which are required to consent to any such waiver or supplemental indenture pursuant to this Section, without the consent of the holders of all of the Notes at the time outstanding (including, without limitation, any change to the definition of “Aggregate Principal Amount of the Outstanding Notes”), (E) modify the rights, duties or immunities of the Security Trustee without the consent of the Security Trustee and the holders of all of the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of the Company and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding, or (F) except as otherwise provided in §10.4 hereof, consent to the release or termination of any Subsidiary Guaranty Agreement without the consent of the holders of all of the Senior Notes at the time outstanding and, if such waiver or supplemental agreement relates to Collateral which constitutes a “substantial part” of the assets of the Company and its Restricted Subsidiaries, without the consent of all of the holders of the Senior Subordinated Notes at the time outstanding.

(b) For purposes of this §9.2, assets subject to any waiver or supplemental agreement shall be deemed to be a “substantial part” of the assets of the Company and its Restricted Subsidiaries if (i) such assets, together with all other assets (A) sold, leased or otherwise disposed of by the Company and its Restricted Subsidiaries or (B) subject to any waiver or supplemental agreement pursuant to this §9.2 or Section 9.2 of the Subsidiary Security Agreement without the consent of the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes or, if such waiver or supplemental agreement is described in clauses (B), (C), (E) or (F) of §9.2(a) or Section 9.2(a) of the Subsidiary Security Agreement, without the consent of all of the holders of the Senior Subordinated Notes, in each case, during the period of 12 months ending with the date of such waiver or supplemental agreement, contributed more than 15% of EBIT of the Company and its Restricted Subsidiaries determined as of the end of the fiscal year immediately preceding such waiver or supplemental agreement, (ii) the book value of such assets, when added to the book value of all other assets of the Company and its Restricted Subsidiaries (A) sold or otherwise disposed of by the Company and its Restricted Subsidiaries or (B) subject to any waiver or supplemental agreement pursuant to this §9.2 or Section 9.2 of the Subsidiary Security Agreement without the consent of the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

Subordinated Notes or, if such waiver or supplemental agreement is described in clauses (B), (C), (E) or (F) of §9.2(a) or Section 9.2(a) of the Subsidiary Security Agreement, without the consent of all of the holders of the Senior Subordinated Notes, in each case, during the period of 12 months ending with the date of such waiver or supplemental agreement, exceeds 10% of the book value of all Receivables of the Company and its Restricted Subsidiaries determined on a consolidated basis as of the end of the fiscal year immediately preceding such waiver or supplemental agreement, or (iii) the book value of such assets, when added to the book value of all other assets of the Company and its Restricted Subsidiaries (A) sold or otherwise disposed of by the Company and its Restricted Subsidiaries or (B) subject to any waiver or supplemental agreement pursuant to this §9.2 or Section 9.2 of the Subsidiary Security Agreement without the consent of the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Subordinated Notes or, if such waiver or supplemental agreement is described in clauses (B), (C), (E) or (F) of §9.2(a) or Section 9.2(a) of the Subsidiary Security Agreement, without the consent of all of the holders of the Senior Subordinated Notes, in each case, during the entire period commencing on April 1, 1997 and ending with the date of such waiver or supplemental agreement, exceeds 25% of the book value of all Receivables of the Company and its Restricted Subsidiaries determined on a consolidated basis as of the end of the fiscal year immediately preceding such waiver or supplemental agreement.

Section 9.3. Notice of Supplements. Promptly after the execution by the Company and the Security Trustee of any supplemental agreement pursuant to the provisions of §9.1 or §9.2 the Company shall deliver a conformed copy thereof, mailed first-class postage prepaid, to each holder of the Notes at its address set forth in the Note Register. Any failure of the Company to give such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental agreement.

Section 9.4. Opinion of Counsel Conclusive as to Supplements. The Security Trustee is hereby authorized to join with the Company in the execution of any such supplemental indenture or agreement authorized or permitted by the terms of this Agreement and to make the further agreements and stipulations which may be therein contained, and the Security Trustee may receive an opinion of independent counsel selected by the Security Trustee as conclusive evidence that any supplemental agreement executed pursuant to the provisions of this §9 complies with the requirements of this §9.

SECTION 10. MISCELLANEOUS.

Section 10.1. Successors and Assigns. Whenever any of the parties hereto is referred to such reference shall be deemed to include the successors and assigns of such party; and all the covenants, promises and agreements in this Agreement contained by or on behalf of the Company or by or on behalf of the Security Trustee shall bind and inure to the benefit of the respective successors and assigns of such parties whether so expressed or not.

Section 10.2. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 10.3. Communications. All communications provided for herein shall be in writing. Communications to the Company or the Security Trustee shall be deemed to have been given (unless otherwise required by the specific provisions hereof in respect of any matter) when addressed and delivered in person, or five days after being deposited in the U.S. mail, postage prepaid, by registered or certified mail or by overnight express mail, as follows:

If to the Company:	World Acceptance Corporation
	108 Frederick Street
	Greenville, South Carolina 29607-2532
	Attention:	Chief Financial Officer
If to the Security Trustee:	Harris Trust and Savings Bank 311 West Monroe, 12th Floor
	Chicago, Illinois 60606
	Attention:	Robert Foltz
		Indenture Trust Division

or to the Company or the Security Trustee at such other address as the Company or the Security Trustee may designate by notice duly given in accordance with this Section to the other. Communications to the holder of a Note shall be deemed to have been given (unless otherwise provided for by the specific provisions hereof in respect of any matter) when delivered personally or five days after being deposited in the U.S. mail, postage prepaid by registered or certified mail or by overnight express mail, addressed to such holder at its address set forth in the Note Register in the case of any holder of the Senior Secured Notes or the Senior Subordinated Notes and at its address set forth in the Revolving Credit Agreement in the case of any holder of the Revolving Credit Notes.

Section 10.4. Release. The Security Trustee shall release fully or partially, as the case may be, the Lien granted by this Agreement under and only under the following circumstances:

(a) Upon the presentation of satisfactory evidence that all Secured Indebtedness has been irrevocably fully paid or discharged and all obligations of the holders of Notes to extend Secured Indebtedness to the Company have terminated or otherwise expired, the Security Trustee shall release the Lien and security interest of this Agreement by proper instrument or instruments;

(b) So long as no Default or Event of Default then exists, upon the sale or other disposition of any assets of the Company and its Restricted Subsidiaries which the Chief Financial Officer of the Company certifies to the Security Trustee and the Noteholders in writing does not constitute a “substantial part” of the assets of the Company and its Restricted Subsidiaries (as defined in Section 5.13 of the Senior Note

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

Agreements, Section 5.13 of the Senior Subordinated Note Agreement and Section 8.13 of the Revolving Credit Agreement), the Security Trustee shall, upon the written direction of the Company and without the consent of the Noteholders (unless the Security Trustee has been notified in writing by a Noteholder prior to such release that such Noteholder in good faith believes that the conditions set forth above have not been satisfied, in which case no such release shall be issued), release the Lien of this Agreement on such assets by proper instrument or instruments. If any such sale or other disposition of assets constituting less than a “substantial part” of the assets of the Company and its Restricted Subsidiaries pursuant to this §10.4(b) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreements with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as the Company may deem necessary or proper to carry out more effectively the foregoing;

(c) Upon the sale or other disposition by the Company of a “substantial part” of the assets of the Company and its Restricted Subsidiaries (as defined in Section 5.13 of the Senior Note Agreements, Section 5.13 of the Senior Subordinated Note Agreement and Section 8.13 of the Revolving Credit Agreement) after the occurrence and during the continuance of a Material Event of Default, the Security Trustee shall, upon the written direction of the Company and the written consent of (x) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Senior Secured Notes, and (y) the holders of more than 50% of the Aggregate Principal Amount of Outstanding Notes, computed solely by reference to the Revolving Credit Notes, and without the further consent of the holders of the Senior Subordinated Notes, release the Lien of this Agreement on such assets by proper instrument or instruments, provided, that, (i) such sale or other disposition is not to an Affiliate, (ii) the sale price for such assets is determined by the Company in good faith to be reasonable, as evidenced by a resolution of the board of directors of the Company, (iii) the proceeds of any such sale or other disposition are applied to the satisfaction of Secured Indebtedness and, if such application results in the prepayment of any obligations under the Revolving Credit Agreement, such application permanently reduces the amount of the commitment under the Revolving Credit Agreement, (iv) each Noteholder shall have received written notice of such sale or other disposition at least ten days prior to the date of such sale or other disposition and (v) the Security Trustee and the Noteholders receive a certificate of the Chief Financial Officer of the Company certifying to each of the foregoing. If any such sale or other disposition of assets of the Company and its Restricted Subsidiaries pursuant to this §10.4(c) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreements with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as the Company may deem necessary or proper to carry out more effectively the foregoing;

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

(d) Upon the sale or other disposition of the Collateral or any part thereof pursuant to and in accordance with §7.2 and conducted in a commercially reasonable manner, the Security Trustee shall release the Lien of this Agreement on the Collateral or such part, as the case may be, by proper instrument or instruments; and

(e) With the prior written consent of each Noteholder, the Security Trustee shall release the Lien of this Agreement by proper instrument or instruments.

Section 10.5. Counterparts. This Agreement may be executed, acknowledged and delivered in any number of counterparts, each of such counterparts constituting an original but all together only one Agreement.

Section 10.6. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF SOUTH CAROLINA.

Section 10.7. Headings. Any headings or captions preceding the text of the several sections hereof are intended solely for convenience of reference and shall not constitute a part of this Agreement nor shall they affect its meaning, construction or effect.

Section 10.8. Prior Liens. Upon the execution and delivery of this Agreement by the Company and the Security Trustee, this Agreement shall supersede all provisions of the Original Security Agreement as of the date of such execution and delivery. The Company hereby agrees that, notwithstanding the execution and delivery of this Agreement, the liens and security interests created and provided for under the Original Security Agreement continue in effect under and pursuant to the terms of this Agreement for the benefit of all of the Secured Indebtedness. Nothing herein shall in any manner affect or impair the priority of the liens and security interests created and provided for by the Original Security Agreement as to the indebtedness and obligations which would otherwise be secured thereby prior to giving effect to this Agreement.

Section 10.9. Rights of Holders of Senior Subordinated Notes. The rights and remedies under this Agreement of the holders of the Senior Subordinated Notes are junior and subordinate to the rights and remedies of the holders of the Senior Notes pursuant to the terms of the Senior Subordinated Note Agreement, reference to Section 9 of which is hereby made for a statement of the terms and conditions thereof.

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed, and the Security Trustee in evidence of its acceptance of the trusts hereby created, has caused this Agreement to be executed on its behalf.

WORLD ACCEPTANCE CORPORATION
By	/s/    A. ALEXANDER MCLEAN III
Its	Executive Vice President
HARRIS TRUST AND SAVINGS BANK, as Security Trustee
By	/s/    ROBERT D. FOLTZ
Its	Vice President

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

NOTEHOLDERS CONSENT

The undersigned Noteholders hereby consent to the execution and delivery of this Agreement by the Companies and the Security Trustee and hereby agree to the terms and provisions of the Amended and Restated Guaranty Agreement executed contemporaneously herewith.

HARRIS TRUST AND SAVINGS BANK, as a Noteholder
By	/S/    JEROME P. CROKIN
Its	Vice President
THE FIRST NATIONAL BANK OF CHICAGO, as a Noteholder
By	/S/    CRAIG GOLDSMITH
Its	Assistant Vice President
LASALLE NATIONAL BANK, as a Noteholder
By	/S/    BEN SCHREINER
Its	Loan Officer
PRINCIPAL MUTUAL LIFE INSURANCE COMPANY, as a Noteholder
By	/S/    JAMES C. FIFIELD
Its	Counsel
By	/S/    STEPHEN G. SKRIVANEK
Its	Counsel

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World Acceptance Corporation Amended and Restated Security Agreement,

Pledge and Indenture of Trust

JEFFERSON-PILOT LIFE INSURANCE COMPANY, as a Noteholder
By	/s/    JAMES E. MCDONALD, JR.
Its	Second Vice President

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DESCRIPTION OF PLEDGED SHARES

SCHEDULE I

(to Security Agreement, Pledge and Indenture of Trust)

PARTNERSHIP INTERESTS

SCHEDULE II

(to Security Agreement, Pledge and Indenture of Trust)

LOCATION OF OFFICES — WORLD ACCEPTANCE CORPORATION

SCHEDULE III

(to Security Agreement, Pledge and Indenture of Trust)

FIRST AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Company Security Agreement”), from World Acceptance Corporation (the “Company”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Company Security Agreement.

Subsequent to the Company’s delivery of the Company Security Agreement, certain shares of stock have been added as Pledged Collateral under the Company Security Agreement. As a result of such addition, Schedule I of the Company Security Agreement does not accurately describe the shares of capital stock currently held by, or to be held by, the Security Trustee as Collateral under the Company Security Agreement.

Pursuant to the requirements of Section 3.9 of the Company Security Agreement, the Company now desires to amend Schedule I to the Company Security Agreement to reflect such additions, and this instrument shall constitute an agreement between the Company and the Security Trustee amending the Company Security Agreement in the respects, but only in the respects, hereinafter set forth:

1. Schedule I of the Company Security Agreement shall be and hereby is amended and as so amended shall be restated in its entirety to read as Schedule I attached hereto.

2. As collateral security for the indebtedness, obligations, and liabilities of the Company set forth in Section 2 of the Company Security Agreement, the Company hereby grants and reaffirms to the Security Trustee a continuing lien on and security interest in, and acknowledges and agrees that the Security Trustee has and shall continue to have a continuing lien on and security interest in, all the shares of capital stock of each issuer listed and described on Schedule I attached hereto and all the other properties, rights, interests and privileges comprising the Pledged Collateral (as such term is defined in the Company Security Agreement after giving effect to this Amendment), to the same extent and with the same force and effect as if the shares of stock described on Schedule I had originally been included on Schedule I to the Company Security Agreement. The foregoing granting clause is in addition to and supplemental of and not in substitution for the granting clause contained in the Company Security Agreement. Neither the Company nor the Security Trustee intends by this Amendment to in any way impair or otherwise affect the lien of the Company Security Agreement on such of the Collateral which was subject to the Company Security Agreement prior to giving effect to this Amendment.

3. The Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Company Security Agreement, each and all of which shall be applicable to all of the properties, rights,

interests and privileges subject to the lien of the Company Security Agreement after giving effect to this Amendment. The Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Company Security Agreement after giving effect to this Amendment.

4. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Company Security Agreement, any reference in any of such to the Company Security Agreement to be deemed to reference to the Company Security Agreement as modified hereby.

5. Except as specifically modified hereby, all the terms and conditions of the Company Security Agreement shall stand and remain unchanged and in full force and effect.

PLEDGOR:

WORLD ACCEPTANCE CORPORATION

By

Name 

Title 

Acknowledged and agreed to as of the date first above written.

HARRIS TRUST AND SAVINGS BANK, as
Security Trustee

By

Name 

Title 

A-2-2

SECOND AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Company Security Agreement”), from World Acceptance Corporation (the “Company”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Company Security Agreement.

The Company and the Security Trustee, acting at the direction of the Noteholders, have agreed to amend the definition of “Receivables” as set forth in the Company Security Agreement to reflect changes in Article 9 of the Uniform Commercial Code, and this instrument shall constitute an agreement between the Company and the Security Trustee amending the Company Security Agreement in the respects, but only in the respects, hereinafter set forth:

1. The definition of “Receivables” appearing in Section 1.1 of the Company Security Agreement shall be amended and restated in its entirety to read as follows:

“Receivables” shall mean all accounts receivable, receivables, contract rights, controls, instruments, notes, drafts, bills, acceptances, documents, chattel paper, general intangibles and all other forms of obligations owing to a Person, including, without limitation, all Accounts, Instruments (including Promissory Notes), Documents, Chattel Paper (including tangible and electronic Chattel Paper), Letter of Credit Rights, Supporting Obligations, General Intangibles (including Payments Intangibles), as defined in the Uniform Commercial Code as in effect in the State of South Carolina.

2. As collateral security for the indebtedness, obligations, and liabilities of the Company set forth in Section 2 of the Company Security Agreement, the Company hereby grants and reaffirms to the Security Trustee a continuing lien on and security interest in, and acknowledges and agrees that the Security Trustee has and shall continue to have a continuing lien on and security interest in, all of the Collateral described therein, including all Receivables as defined above whether now existing or hereafter arising or acquired. Neither the Company nor the Security Trustee intends by this Amendment to in any way impair or otherwise affect the lien of the Company Security Agreement on such of the Collateral which was subject to the Company Security Agreement prior to giving effect to this Amendment.

3. The Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Company Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Company Security Agreement after

giving effect to this Amendment. The Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Company Security Agreement after giving effect to this Amendment.

4. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Company Security Agreement, any reference in any of such to the Company Security Agreement to be deemed to reference to the Company Security Agreement as modified hereby.

5. Except as specifically modified hereby, all the terms and conditions of the Company Security Agreement shall stand and remain unchanged and in full force and effect.

PLEDGOR:

WORLD ACCEPTANCE CORPORATION

By

Name 

Title 

Acknowledged and agreed to as of the date first above written.

HARRIS TRUST AND SAVINGS BANK, as
Security Trustee

By

Name 

Title 

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NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Company Security Agreement, the undersigned Noteholders hereby consent to the Second Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

HARRIS TRUST AND SAVINGS BANK

By

Its

BANK ONE, NA

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

PRINCIPAL LIFE INSURANCE COMPANY

By

Its

By

Its

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THIRD AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Company Security Agreement”), from World Acceptance Corporation (the “Company”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Company Security Agreement.

Subsequent to the Company’s delivery of the Company Security Agreement, the Company and the Security Trustee have agreed to add Deposit Accounts (as defined below), whether now owned or existing or hereafter created, acquired or arising, as Collateral under the Company Security Agreement. The Company and the Security Trustee now desire to amend the Company Security Agreement to reflect such addition.

SECTION 1. AMENDMENTS.

Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Company Security Agreement shall be and is hereby amended as follows:

1.1. Section 2.9 of the Company Security Agreement shall be amended and restated in its entirety to read as follows:

Section 2.9. Deposit Accounts. All Deposit Accounts, as such term is defined in the Uniform Commercial Code; and

1.2. Section 2 of the Company Security Agreement shall be further amended by inserting the following subsection in proper numerical order:

Section 2.10. Other Proceeds and Products. All proceeds and products of the foregoing and all insurance of the foregoing and proceeds thereof, whether now existing or hereafter arising.

1.3. Section 3 of the Company Security Agreement shall be amended by inserting the following subsection in proper numerical order:

Section 3.11. Deposit Accounts. The Company may maintain one or more local deposit accounts for the deposit of checks and the making of disbursements in the ordinary course of business (“Local Accounts”) and one or more concentration accounts into which the Company sweeps or periodically transfers collections from the Subsidiary Local Accounts in the ordinary course of business (“Concentration Accounts”). All Concentration Accounts of the Company as of August 21, 2003, are listed and

identified (by account number and depository institution) on Schedule IV attached hereto and made a part hereof. The Company shall promptly notify the Security Trustee of any other Concentration Account opened or maintained by the Company after the date hereof, and shall submit to the Security Trustee a supplement to Schedule IV to reflect such additional accounts (provided the Company’s failure to do so shall not impair the Security Trustee’s security interest therein). So long as no Event of Default has occurred and is continuing, the Security Trustee’s security interest in the Local Accounts need not be perfected. With respect to any Concentration Account maintained by a depository institution other than the Security Trustee, and as a condition to the establishment and maintenance of any such Concentration Account, at all times on and after December 31, 2003, the Company and such depository institution shall have executed and delivered to the Security Trustee an account control agreement in form and substance satisfactory to the Security Trustee which provides, among other things, for the depository institution’s agreement that it will comply with instructions originated by the Security Trustee directing the disposition of the funds in the Concentration Account(s) at such depository institution without further consent by the Company.

1.4. Schedule IV is hereby added to the Company Security Agreement, to read as set forth on Schedule IV to this Amendment.

SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

The Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Company Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Company Security Agreement after giving effect to this Amendment. The Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Company Security Agreement after giving effect to this Amendment.

SECTION 3. MISCELLANEOUS.

3.1. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Company Security Agreement, any reference in any of such to the Company Security Agreement to be deemed to reference to the Company Security Agreement as modified hereby.

3.2. Except as specifically modified hereby, all the terms and conditions of the Company Security Agreement shall stand and remain unchanged and in full force and effect.

2

3.3. This Amendment may be executed in any number of counterparts, and by the different parties on different counterpart pages, all of which taken together shall constitute one and the same agreement. Any of the parties hereto may execute this Amendment by signing any such counterpart and each of such counterparts shall for all purposes be deemed to be an original. This Amendment shall be governed by the laws of the State of South Carolina.

[SIGNATURE PAGES TO FOLLOW]

3

This Third Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust is dated as of August 21, 2003.

WORLD ACCEPTANCE CORPORATION

By

Name

Title

Acknowledged and agreed to as of the date first above written.

HARRIS TRUST AND SAVINGS BANK, as
Security Trustee

By

Name

Title

4

NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Company Security Agreement, the undersigned Noteholders hereby consent to the Third Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

HARRIS TRUST AND SAVINGS BANK

By

Its

BANK ONE, NA

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED
CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

5

PRINCIPAL LIFE INSURANCE COMPANY

By

Its

By

Its

6

SCHEDULE IV

CONCENTRATION ACCOUNTS

ACCOUNT NUMBER	DEPOSITORY INSTITUTION
2079891217439	Wachovia Bank

7

FOURTH AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Company Security Agreement”), from World Acceptance Corporation (the “Company”) to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Company Security Agreement.

Subsequent to the Company’s delivery of the Company Security Agreement, (a) certain shares of stock have been added as Pledged Collateral under the Company Security Agreement and, as a result of such addition, Schedule I of the Company Security Agreement does not accurately describe the shares of capital stock currently held by, or to be held by, the Security Trustee as Collateral under the Company Security Agreement and (b) the Senior Secured Notes and the Senior Subordinated Notes have been paid in full. The Company and the Security Trustee now desire to amend the Company Security Agreement to reflect such changes and to make certain other amendment to the Company Security Agreement as provided for herein.

SECTION 1. AMENDMENTS.

Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Company Security Agreement shall be and is hereby amended as follows:

1.1. Schedule I of the Company Security Agreement shall be and hereby is amended and as so amended shall be restated in its entirety to read as Schedule I attached hereto. As collateral security for the indebtedness, obligations, and liabilities of the Company set forth in Section 2 of the Company Security Agreement, the Company hereby grants and reaffirms to the Security Trustee a continuing lien on and security interest in, and acknowledges and agrees that the Security Trustee has and shall continue to have a continuing lien on and security interest in, all the shares of capital stock of each issuer listed and described on Schedule I attached hereto and all the other properties, rights, interests and privileges comprising the Pledged Collateral (as such term is defined in the Company Security Agreement after giving effect to this Amendment), to the same extent and with the same force and effect as if the shares of stock described on Schedule I had originally been included on Schedule I to the Company Security Agreement. The foregoing granting clause is in addition to and supplemental of and not in substitution for the granting clause contained in the Company Security Agreement. Neither the Company nor the Security Trustee intends by this Amendment to in any way impair or otherwise affect the lien of the Company Security Agreement on such of the Collateral which was subject to the Company Security Agreement prior to giving effect to this Amendment.

1.2. On or about June 30, 2004, the Senior Subordinated Notes were paid in full and are no longer outstanding. On or about December 31, 1999, the Senior Secured Notes were paid in full and are no longer outstanding. Accordingly, any and all

references in the Company Security Agreement to the terms “Senior Note Agreements,” “Senior Secured Notes,” “Senior Subordinated Notes,” and “Senior Subordinated Note Agreement” shall be deleted.

1.3. Recital C to the Company Security Agreement shall be amended and restated in its entirety to read as follows:

C. The Company has authorized borrowings pursuant to the Revolving Credit Agreement, whether or not such borrowings are evidenced by promissory notes and as the same may from time to time be amended or restated pursuant to the terms thereof and any notes executed in replacement thereof (the “Revolving Credit Notes”).

In addition, all references to the terms “Senior Notes” and “Notes” in the Company Security Agreement shall from and after the date hereof be deemed a reference to the Revolving Credit Notes.

1.4. The definitions of “Aggregate Principal Amount of the Outstanding Notes,” “Consolidated Adjusted Net Worth,” “Make-Whole Amount,” “Material Event of Default,” “Maximum Principal Amount,” appearing in Section 1.1 of the Company Security Agreement shall be deleted.

1.5. All references to the phase “holders of a majority of the Aggregate Principal Amount of the Outstanding Notes” or words of like import in the Company Security Agreement shall from and after the date hereof be deemed a reference to the Required Banks as hereinafter defined.

1.6. The definitions of “Indebtedness for Borrowed Money,” “Secured Indebtedness,” and “Subsidiary Guaranty Agreements” appearing in Section 1.1 of the Company Security Agreement shall be amended and restated in their entirety to read as follows:

“Indebtedness for Borrowed Money” shall have the same meaning herein as such term is defined in the Revolving Credit Agreement.

“Secured Indebtedness” shall mean the “Obligations,” as such term is defined in the Revolving Credit Agreement, in each case whether now existing or hereafter arising, due or to become due, direct or indirect, absolute or contingent, and howsoever evidenced, held or acquired.

“Subsidiary Guaranty Agreement” shall mean the Amended and Restated Guaranty Agreement dated as of June 30, 1997 of each Restricted Subsidiary existing on such date and each other Restricted Subsidiary which has executed a Guaranty Supplement

-2-

in the form of Exhibit A thereto pursuant to the terms thereof and §3.9 (or in such other form agreed to by the Agent), in each case, for the benefit of the Security Trustee and the holders of the Senior Notes, as the same may from time to time be amended, restated, modified, supplemented or waived pursuant to the terms thereof.

1.7. Section 1.1 of the Company Security Agreement shall be amended by adding in appropriate alphabetical order the following definition:

“Required Banks” shall have the same meaning herein as such term is defined in the Revolving Credit Agreement.

1.8. Section 9.2 of the Company Security Agreement shall be amended and restated to read as follows:

Section 9.2. Waivers and Consents by Noteholders; Supplemental Security Agreements with Noteholders’ Consent. (a) Upon the waiver or consent of the Agent (acting at the direction or with the consent of the Required Banks under the Revolving Credit Agreement), the Company and the Security Trustee may enter into an agreement or agreements supplemental hereto for the purpose of waiving, adding, changing or eliminating any provisions of this Agreement or of any agreement supplemental hereto or modifying in any manner the rights and obligations of the holders of the Notes and the Company.

1.9. Section 10.4 of the Company Security Agreement shall be amended and restated to read as follows:

Section 10.4. Release. The Security Trustee shall release fully or partially, as the case may be, the Lien granted by this Agreement under and only under the following circumstances:

(a) Upon the presentation of satisfactory evidence that all Secured Indebtedness has been irrevocably fully paid or discharged and all obligations of the holders of Notes to extend Secured Indebtedness to the Company have terminated or otherwise expired, the Security Trustee shall release the Lien and security interest of this Agreement by proper instrument or instruments;

(b) So long as no Default or Event of Default then exists, upon the sale or other disposition of any assets of the Company and its Restricted Subsidiaries which the Chief Financial Officer of the Company certifies to the Security Trustee and the Noteholders in writing does not constitute a “substantial part” of

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the assets of the Company and its Restricted Subsidiaries (as defined in Section 8.13 of the Revolving Credit Agreement), the Security Trustee shall, upon the written direction of the Company and without the consent of the Noteholders (unless the Security Trustee has been notified in writing by a Noteholder prior to such release that such Noteholder in good faith believes that the conditions set forth above have not been satisfied, in which case no such release shall be issued), release the Lien of this Agreement on such assets by proper instrument or instruments. If any such sale or other disposition of assets constituting less than a “substantial part” of the assets of the Company and its Restricted Subsidiaries pursuant to this §10.4(b) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreement with respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as the Company may deem necessary or proper to carry out more effectively the foregoing;

(c) Upon the sale or other disposition by the Company of a “substantial part” of the assets of the Company and its Restricted Subsidiaries (as defined in Section 8.13 of the Revolving Credit Agreement) after the occurrence and during the continuance of an Event of Default, the Security Trustee shall, upon the written direction of the Company and the written consent of the Required Banks, release the Lien of this Agreement on such assets by proper instrument or instruments, provided, that, (i) such sale or other disposition is not to an Affiliate, (ii) the sale price for such assets is determined by the Company in good faith to be reasonable, as evidenced by a resolution of the board of directors of the Company, (iii) the proceeds of any such sale or other disposition are applied to the satisfaction of Secured Indebtedness and, if such application results in the prepayment of any obligations under the Revolving Credit Agreement, such application permanently reduces the amount of the commitment under the Revolving Credit Agreement (unless the Required Banks agree otherwise), (iv) each Noteholder shall have received written notice of such sale or other disposition at least ten days prior to the date of such sale or other disposition and (v) the Security Trustee and the Noteholders receive a certificate of the Chief Financial Officer of the Company certifying to each of the foregoing. If any such sale or other disposition of assets of the Company and its Restricted Subsidiaries pursuant to this §10.4(c) results in the sale or other disposition of the capital stock or other equity interest in a Restricted Subsidiary, the Subsidiary Guaranty Agreement with

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respect to, and only with respect to, such Restricted Subsidiary shall automatically be released and the Security Trustee and the Noteholders agree to execute and deliver such further instruments and do such further acts as the Company may deem necessary or proper to carry out more effectively the foregoing;

(d) Upon the sale or other disposition of the Collateral or any part thereof pursuant to and in accordance with §7.2 and conducted in a commercially reasonable manner, the Security Trustee shall release the Lien of this Agreement on the Collateral or such part, as the case may be, by proper instrument or instruments; and

(e) With the prior written consent of each Noteholder, the Security Trustee shall release the Lien of this Agreement or on any assets covered by this Agreement by proper instrument or instruments.

1.10. Section 10.9 of the Company Security Agreement shall be amended and restated to read as follows:

Section 10.9. Intentionally Deleted.

SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

The Company hereby represents and warrants to the Security Trustee and the Noteholders that the Senior Secured Notes and the Senior Subordinated Notes (as defined prior to giving effect to this Amendment) have been paid in full and the Senior Note Agreements and Senior Subordinate Note Agreement have terminated in accordance with their terms. The Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Company Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Company Security Agreement after giving effect to this Amendment. The Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Company Security Agreement after giving effect to this Amendment.

SECTION 3. MISCELLANEOUS.

3.1. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Company Security Agreement, any reference in any of such to the Company Security Agreement to be deemed to reference to the Company Security Agreement as modified hereby.

3.2. Except as specifically modified hereby, all the terms and conditions of the Company Security Agreement shall stand and remain unchanged and in full force and effect.

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3.3. This Amendment may be executed in any number of counterparts, and by the different parties on different counterpart pages, all of which taken together shall constitute one and the same agreement. Any of the parties hereto may execute this Amendment by signing any such counterpart and each of such counterparts shall for all purposes be deemed to be an original. This Amendment shall be governed by the laws of the State of South Carolina.

[SIGNATURE PAGES TO FOLLOW]

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This Fourth Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust is dated as of August __, 2004.

WORLD ACCEPTANCE CORPORATION

By

Name

Title

HARRIS TRUST AND SAVINGS BANK, as
Security Trustee

By

Name

Title

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Noteholders’ Consent

Pursuant to Section 9.2 of the Company Security Agreement, the undersigned Noteholders hereby consent to the Fourth Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

HARRIS TRUST AND SAVINGS BANK

By

Its

BANK ONE, NA

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED
CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

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SCHEDULE I

DESCRIPTION OF PLEDGED SHARES

SUBSIDIARY	DESCRIPTION	NUMBER OF SHARES		STOCK CERTIFICATE NO.
WAC Insurance Company, Ltd.	Common, $1 par	325	*	1
WFC of South Carolina, Inc.	Common, $.01 par	10,000		1
World Acceptance Corporation of Alabama	Common, $.01 par	1,000		1
World Acceptance Corporation of Missouri	Common, $.01 par	1,000		1
World Finance Corporation of Georgia	Common, $1 par	25,000 25,000		1 2
World Finance Corporation of Illinois	Common, $.01 par	1,000		1
World Finance Corporation of Louisiana	Common, no par	25		1
World Finance Corporation of New Mexico	Common, $.01 par	1,000		3
World Finance Corporation of South Carolina	Common, $1 par	3,750		1
World Finance Corporation of Tennessee	Common, $.01 par	1,000		1
World Finance Corporation of Texas	Class A Common, $1 par	125,000		A-1
	Class B Common, par	5,802		B-2
WFC Services, Inc.	No par	1,000		1
World Finance Corporation of Kentucky	No par	1,000		1
World Finance Corporation of Colorado	Common, no par	1,000		1

* Constituting 65% of the outstanding stock

FIFTH AMENDMENT TO AMENDED AND RESTATED

SECURITY AGREEMENT, PLEDGE AND INDENTURE OF TRUST

Reference is hereby made to that certain Amended and Restated Security Agreement, Pledge and Indenture of Trust dated as of June 30, 1997 (as the same may be amended, the “Company Security Agreement”), from World Acceptance Corporation (the “Company”) to Harris N.A., as successor by merger to Harris Trust and Savings Bank, as Security Trustee. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Company Security Agreement.

Subsequent to the Company’s delivery of the Company Security Agreement, certain shares of stock have been added as Pledged Collateral under the Company Security Agreement and, as a result of such addition, Schedule I of the Company Security Agreement does not accurately describe the shares of capital stock currently held by, or to be held by, the Security Trustee as Collateral under the Company Security Agreement. In addition, the Company and the holders of the Senior Notes have concurrently herewith entered into an Amended and Restated Revolving Credit Agreement, which continues to be secured by, among other things, the Collateral. The Company and the Security Trustee now desire to amend the Company Security Agreement to reflect such changes and to make certain other amendment to the Company Security Agreement as provided for herein.

SECTION 1. AMENDMENTS.

Subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Company Security Agreement shall be and is hereby amended as follows:

1.1. Schedule I of the Company Security Agreement shall be and hereby is amended and as so amended shall be restated in its entirety to read as Schedule I attached hereto. As collateral security for the indebtedness, obligations, and liabilities of the Company set forth in Section 2 of the Company Security Agreement, the Company hereby grants and reaffirms to the Security Trustee a continuing lien on and security interest in, and acknowledges and agrees that the Security Trustee has and shall continue to have a continuing lien on and security interest in, all the shares of capital stock of each issuer listed and described on Schedule I attached hereto and all the other properties, rights, interests and privileges comprising the Pledged Collateral (as such term is defined in the Company Security Agreement after giving effect to this Amendment), to the same extent and with the same force and effect as if the shares of stock described on Schedule I had originally been included on Schedule I to the Company Security Agreement. The foregoing granting clause is in addition to and supplemental of and not in substitution for the granting clause contained in the Company Security Agreement. Neither the Company nor the Security Trustee intends by this Amendment to in any way impair or otherwise affect the lien of the Company Security Agreement on such of the Collateral which was subject to the Company Security Agreement prior to giving effect to this Amendment.

1.2. All references to the term “Revolving Credit Agreement” in the Company Security Agreement shall from and after the date hereof be deemed a reference to the Amended and Restated Revolving Credit Agreement dated as of July 20, 2005, by and among the Company, the

financial institutions from time to time party thereto, as Banks, and Harris N.A., as Agent, as the same may from time to time hereafter be further amended or modified, including further amendments and restatements of the same in its entirety; and all references to the terms “Senior Notes” and “Notes” in the Company Security Agreement shall from and after the date hereof be deemed a reference to the promissory notes issued from time to time pursuant to the Revolving Credit Agreement, including any and all promissory notes executed in substitution or replacement therefor or an extension or renewal thereof, in each case as the same may be amended or modified from time to time.

1.3. Section 2 of the Company Security Agreement shall be amended by striking the period appearing after Section 2.10 and inserting in its place a semicolon followed by the following phrase:

provided that, in the case of a lien and security interest on the voting stock or other similar voting equity interests of a corporation, limited liability company, partnership or other organization which is a “controlled foreign corporation” as defined under Section 957 of the Internal Revenue Code (herein, a “Foreign Company”), if granting a security interest of more than 65% of the total combined voting stock or other voting equity interests of any such Foreign Company would cause adverse tax consequences to the Company, then such lien and security interest on the voting stock or other voting equity interests shall be limited to 65% of the total combined voting stock or other voting equity interests of such Foreign Company.

SECTION 2. REPRESENTATIONS, WARRANTIES AND COVENANTS.

The Company hereby repeats and reaffirms all of its covenants, agreements, representations and warranties contained in the Company Security Agreement, each and all of which shall be applicable to all of the properties, rights, interests and privileges subject to the lien of the Company Security Agreement after giving effect to this Amendment. The Company hereby certifies that no Event of Default or event which, with notice or lapse of time or both, would constitute an Event of Default exists under the Company Security Agreement after giving effect to this Amendment.

SECTION 3. MISCELLANEOUS.

3.1. No reference to this Amendment need be made in any note, instrument or other document at any time referring to the Company Security Agreement, any reference in any of such to the Company Security Agreement to be deemed to reference to the Company Security Agreement as modified hereby.

3.2. Except as specifically modified hereby, all the terms and conditions of the Company Security Agreement shall stand and remain unchanged and in full force and effect.

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3.3. This Amendment may be executed in any number of counterparts, and by the different parties on different counterpart pages, all of which taken together shall constitute one and the same agreement. Any of the parties hereto may execute this Amendment by signing any such counterpart and each of such counterparts shall for all purposes be deemed to be an original. This Amendment shall be governed by the laws of the State of South Carolina.

[SIGNATURE PAGES TO FOLLOW]

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This Fifth Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust is dated as of July 20, 2005.

WORLD ACCEPTANCE CORPORATION

By

Name

Title

HARRIS N.A., as successor by merger to Harris

    Trust and Savings Bank, as Security Trustee

By

Name

Title

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NOTEHOLDERS’ CONSENT

Pursuant to Section 9.2 of the Company Security Agreement, the undersigned Noteholders hereby consent to the Fifth Amendment to Amended and Restated Security Agreement, Pledge and Indenture of Trust, and direct the Security Trustee to execute such Amendment.

Harris N.A., as successor by merger to Harris

    Trust and Savings Bank, as Security Trustee

By

Its

JPMORGAN CHASE BANK, N.A.

By

Its

LASALLE BANK NATIONAL ASSOCIATION

By

Its

HIBERNIA NATIONAL BANK

By

Its

WELLS FARGO FINANCIAL PREFERRED

    CAPITAL, INC.

By

Its

CAROLINA FIRST BANK

By

Its

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SCHEDULE I

DESCRIPTION OF PLEDGED SHARES

SUBSIDIARY	DESCRIPTION	NUMBER OF SHARES		STOCK CERTIFICATE NO.
WAC Insurance Company, Ltd.	Common, $1 par	325	*	1
WFC of South Carolina, Inc.	Common, $.01 par	10,000		1
World Acceptance Corporation of Alabama	Common, $.01 par	1,000		1
World Acceptance Corporation of Missouri	Common, $.01 par	1,000		1
World Finance Corporation of Georgia	Common, $1 par	25,000 25,000		1 2
World Finance Corporation of Illinois	Common, $.01 par	1,000		1
World Finance Corporation of Louisiana	Common, no par	25		1
World Finance Corporation of New Mexico	Common, $.01 par	1,000		3
World Finance Corporation of South Carolina	Common, $1 par	3,750		1
World Finance Corporation of Tennessee	Common, $.01 par	1,000		1
World Finance Corporation of Texas	Class A Common, $1 par	125,000		A-1
	Class B Common, par	5,802		B-2
WFC Services, Inc., a Tennessee corporation	No par	1,000		1
World Finance Corporation of Kentucky	No par	1,000		1
World Finance Corporation of Colorado	Common, no par	1,000		1
WFC Services, Inc., a South Carolina corporation	No par	1,000		1
World Acceptance Corporation de México, S. de R.L. de C.V.	Membership interest	N/A		uncertificated interest*
Servicios World Acceptance Corporation de México, S. de R.L. de C.V.	Membership interest	N/A		uncertificated interest*

* Constituting 65% of the outstanding voting stock

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, D. R. Jones, certify that:

1. I have reviewed this quarterly report on Form 10-Q of World Acceptance Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13(a)–15(e) and 15(d)–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s fiscal quarter ended September 30, 2005, that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 9, 2005	/s/    D.R. JONES
	D.R. Jones
	President and CEO

22

EX-31.2

EXHIBIT 31.2

I, A.A. McLean III, certify that:

1. I have reviewed this quarterly report on Form 10-Q of World Acceptance Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13(a)–15(e) and 15(d)–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s fiscal quarter ended September 30, 2005, that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 9, 2005	/s/    A. A. MCLEAN III
	A.A. McLean III
	Executive Vice President and CFO

23

EX-32.1

EXHIBIT # 32.1

CERTIFICATION OF PERIODIC REPORT

I, D.R. Jones, of World Acceptance Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that (to my knowledge):

(1) the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2005, (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 9, 2005

/s/    D.R. JONES        

D.R. Jones

President and CEO

24

EX-32.2

EXHIBIT # 32.2

CERTIFICATION OF PERIODIC REPORT

I, A. A. McLean III, of World Acceptance Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that (to my knowledge):

(1) the Quarterly Report on Form 10-Q of the Company for the quarter ended September 30, 2005, (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 9, 2005

/s/    A. A. MCLEAN III        

A.A. McLean III

Executive Vice President and CFO

25