FIFTH AMENDMENT TO
EXTENSION OF TERM OF NOTES UNDER MASTER LINE OF CREDIT AGREEMENT

This Fifth Amendment to Extension of Term of Notes under Master Line of Credit
Agreement (this "Amendment") is entered into to be effective as of August 31,
2005 (the "Effective Date") by and between Mendocino Brewing Company, Inc., a
California corporation ("Borrower"), and United Breweries of America, Inc., a
Delaware corporation ("Lender").
 
RECITALS

A. Borrower and Lender entered into an Extension of Term of Notes Under Master
Line of Credit Agreement dated February 14, 2002, and amended as of August 15,
2002, March 31, 2003, August 14, 2003, and August 14, 2004 (the "Original
Agreement"), which provides that the terms of certain of the Notes made by
Borrower in favor of Lender shall be extended until August 31, 2005.
 
B. Subject to the terms and conditions of this Amendment, the parties now wish
to further extend the terms of certain of the Notes.
 
C. Any capitalized terms not otherwise defined herein shall have the meanings
set forth in the Original Agreement.
 
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is acknowledged, Borrower and Lender agree as follows:
 
1. Extension of Term. Section 1 of the Original Agreement is amended to read as
follows:
 
The Notes provide that Lender has the right, at any time on or after the
respective maturity dates of the Notes, to convert the Notes into shares of
Borrower's common stock. However, Section 3 of the Notes provides that in the
event that Lender has not converted the entire principal amount of any Note on
or before its respective maturity date, Lender has the right to extend the term
of such Note for a period of time mutually agreed upon between Lender and
Borrower. The parties hereby modify their previous agreement and agree to extend
the term of each of the Notes itemized Nos. 1 through 13 on Exhibit A, effective
as of the maturity date of each respective Note, for a period of time ending on
December 31, 2006.
 
2. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of California, without regard to the
conflicts of laws principles of that or any other jurisdiction.
 
3. Counterparts. This Amendment may be executed in one or more counterparts,
each of which shall be deemed an original, and all taken together shall
constitute one and the same instrument.
 
4. Miscellaneous. This Amendment, in connection with the Original Agreement,
contains all of the agreements, conditions, promises and covenants between the
parties with respect to the subject matter hereof and supersedes all prior or
contemporaneous agreements, representations or understandings with respect to
the subject matter hereof. In the event of any conflict between the terms of the
Original Agreement and this Amendment, the terms of this Amendment shall govern.
Except as set forth in this Amendment, the terms of the Original Agreement shall
remain in full force and effect. This Amendment may not be amended, modified,
altered or otherwise changed in any respect except by written agreement signed
by authorized representatives on behalf of Borrower and Lender. If any one or
more of the provisions contained in this Amendment shall be invalid, illegal or
unenforceable in any respect, the validity, legality or enforce ability of the
remaining provisions contained herein shall not in any way be affected or
impaired.
 
[signature page to follow]
 
 
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IN WITNESS WHEREOF, duly executed representatives of each of the parties hereto
have executed and delivered this Amendment, to be effective as of the Effective
Date first stated above.
 
Borrower:
 
MENDOCINO BREWING COMPANY, INC.
a California corporation
   
Lender:
 
UNITED BREWERIES OF AMERICA, INC.
a Delaware corporation
 
 
 By: /s/ N. Mahadevan      By: /s/ Anil Pisharody  

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Name:  N. Mahadevan 
Title:  Chief Financial Officer and Secretary
     

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Name: Anil Pisharody
Title: Secretary
         

 
 
 
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