<PAGE>   1
                                                                  Exhibit 10.20
                                PROMISSORY NOTE

<TABLE>
<CAPTION>
  Principal   Loan Date  Maturity  Loan No.  Call      Collateral     Account        Officer        Initials
<S>           <C>        <C>       <C>       <C>       <C>            <C>            <C>            <C>
$2,900,000.00  8/24/98   12/31/99
</TABLE>
References in the shaded area are for Lender's use only and do not limit the 
applicability of this document to any particular loan or item.


Borrower: Table Mountain Band of Indians of the 
          Table Mountain Rancheria
          8184 Table Mountain Road
          Friant, CA  93626

Lender:   American Vantage Companies
          6787 West Tropicana, Ste 200
          Las Vegas, NV  89103

-------------------------------------------------------------------------------

PRINCIPAL AMOUNT: $2,900,000.00                 DATE OF NOTE: August 24, 1998


PROMISE TO PAY. Table Mountain Band of Indians of the Table Mountain Rancheria 
("Borrower") promises to pay to American Vantage Companies ("Lender"), or 
order, in lawful money of the United States of America, the principal amount of 
Two Million Nine Hundred Thousand and 00/100 Dollars ($2,900,000.00), together 
with interest on the unpaid principal balance from August 24, 1998, until paid 
in full.

PAYMENT. Borrower will pay this loan on demand, or if no demand is made, in 
accordance with the following payment schedule:

     7 CONSECUTIVE MONTHLY INTEREST PAYMENTS, BEGINNING SEPTEMBER 15, 1998, WITH
     INTEREST CALCULATED ON THE UNPAID PRINCIPAL BALANCES AT AN INTEREST RATE OF
     9.500%; 8 CONSECUTIVE MONTHLY PRINCIPAL AND INTEREST PAYMENTS OF
     $133,382.27 EACH, BEGINNING APRIL 15, 1999, WITH INTEREST CALCULATED ON THE
     UNPAID PRINCIPAL BALANCES AT AN INTEREST RATE OF 9.500%; AND 1 PRINCIPAL
     AND INTEREST PAYMENT OF $2,019,350.58 ON DECEMBER 31, 1999, WITH INTEREST
     CALCULATED ON THE UNPAID PRINCIPAL BALANCES AT AN INTEREST RATE OF 9.500%.
     THIS ESTIMATED FINAL PAYMENT IS BASED ON THE ASSUMPTION THAT ALL PAYMENTS
     WILL BE MADE EXACTLY AS SCHEDULED; THE ACTUAL FINAL PAYMENT WILL BE FOR ALL
     PRINCIPAL AND ACCRUED INTEREST NOT YET PAID, TOGETHER WITH ANY OTHER UNPAID
     AMOUNTS UNDER THIS NOTE. PAYMENTS ARE TO BE SENT TO UNITED SECURITY BANK,
     FRESNO, CALIFORNIA FOR THE ACCOUNT OF AMERICAN VANTAGE COMPANIES.

The annual interest rate for this Note is computed on a 365/360 basis; that is, 
by applying the ratio of the annual interest rate over a year of 365 days 
multiplied by the outstanding principal balance, multiplied by the actual 
number of days the principal balance is outstanding. Borrower will pay Lender 
at Lender's address shown above or at such other place as Lender may designate 
in writing. Unless otherwise agreed or required by applicable law, payments 
will be applied first to accrued unpaid interest, then to principal, and any 
remaining amount to any unpaid collection costs and late charges.

PREPAYMENT: MINIMUM INTEREST CHARGE. Other than Borrower's obligation to pay 
any minimum interest charge, Borrower may pay without penalty all or a portion 
of the amount owed earlier than it is due. Early payments will not, unless 
agreed to by Lender in writing, relieve Borrower of Borrower's obligation to 
continue to make payments under the payment schedule. Rather, they will reduce 
the principal balance due and may result in Borrower making fewer payments.

LATE CHARGE. If a payment is 10 DAYS OR MORE LATE, Borrower will be charged 
5.000% OF THE REGULARLY SCHEDULED PAYMENT OF $15.00, WHICHEVER IS GREATER.

DEFAULT. Borrower will be in default if any of the following happens: (a) 
Borrower fails to make any payment when due. (b) Borrower breaks any promise 
Borrower has made to Lender, or Borrower fails to comply with or to perform 
when due any other term, obligation, covenant, or condition contained in this 
Note or any agreement related to this Note, or in any other agreement or loan 
Borrower has with Lender. (c) Borrower defaults under any loan, extension of 
credit, security agreement, purchase or sales agreement, or any other 
agreement, in favor of any other creditor or person that may materially affect 
any of Borrower's property or Borrower's ability to repay this Note or perform 
Borrower's obligations under this note or any of the Related Documents. (d) Any
representation or statement made or furnished to Lender by Borrower or on 
Borrower's behalf is false or misleading in any material respect either now or 
at the time made or furnished. (e) Borrower becomes insolvent, a receiver is 
appointed for any part of Borrower's property, Borrower makes an assignment for
the benefit of creditors, or any proceeding is commenced either by Borrower or 
against Borrower under any bankruptcy or insolvency laws. (f) Any creditor tries
to take any of Borrower's property on or in which Lender has a lien or security 
interest. This includes a garnishment of any of Borrower's accounts with 
Lender. (g) Any guarantor dies or any of the other events described in this 
default section occurs with respect to any guarantor of this Note. (h) A 
material adverse change occurs in Borrower's financial condition, or Lender 
believes that prospect of payment or performance of the indebtedness is 
impaired.

If any default, other than a default in payment, is curable and if Borrower has 
not been given a notice of a breach of the same provision of this Note within 
the preceding twelve (12) months, it may be cured (and no event of default will 
have occurred) if Borrower, after receiving written notice from Lender 
demanding cure of such default: (a) cures the default within fifteen (15) days; 
or (b) if the cure requires more than fifteen (15) days, immediately initiates 
steps which Lender deems in Lender's sole discretion to be sufficient to cure 
the default and thereafter continues and completes all reasonable and necessary 
steps sufficient to produce compliance as soon as reasonably practical.

LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount. Upon Borrower's failure to pay
all amounts declared due pursuant to this section, including failure to pay upon
final maturity, Lender, at its option, may also, if permitted under applicable
law, do one or both of the following: (a) increase the interest rate on this
Note 3.000 percentage points, and (b) add any unpaid accrued interest to
principal and such sum will bear interest therefrom until paid at the rate
provided in this Note (including any increased rate). Lender may hire or pay
someone else to help collect this Note if Borrower does not pay. Borrower also
will pay Lender that amount. This includes, subject to any limits under
applicable law, Lender's attorneys' fees and Lender's legal expenses whether or
not there is a lawsuit, including attorneys' fees and legal expenses for
bankruptcy proceedings (including efforts to modify or vacate any automatic stay
or injunction), appeals, and any anticipated post-judgment collection services.
Borrower also will pay any court costs, in addition to all other sums provided
by law. THIS NOTE HAS BEEN DELIVERED TO LENDER AND ACCEPTED BY LENDER IN THE
STATE OF NEVADA. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE ADDENDUM ATTACHED HERETO AND MADE A PART HEREOF.

DISHONORED ITEM FEE. 

LINE OF CREDIT. This Note evidences a straight line of credit. Once the total
amount of principal has been advanced, Borrower is not entitled to further loan
advances. Advances under this Note, as well as directions for payment from
Borrower's accounts, may be requested orally or in writing by Borrower or by an
authorized person. Lender may, but need not, require that all oral requests be
confirmed in writing. The following party or parties are authored to request
advances under the line of credit until lender receives from Borrower at
Lender's address shown above written notice of revocation of their authority:
Vern Castro, Chairman. Borrower agrees to be liable for all sums either: (a)
advance in accordance with the instructions of an authorized person or (b)
credited to any of Borrower's accounts with Lender. The unpaid principal balance
owing in this Note at any time may be evidenced by endorsements on this Note or
by Lender's internal records, including daily computer print-outs. Lender will
also have no obligation to advance funds under this Note if: (a) Borrower or any
guarantor is in default under the terms of this Note or any agreement that
Borrower or any guarantor has with Lender, including any agreement made in
connection with the signing of this Note; (b) Borrower or any guarantor ceases
doing business or is insolvent; (c) any guarantor seeks, claim or otherwise
attempt to limit, modify or revoke such guarantor's guarantee of this Note or
any other loan with Lender; or (d) Borrower has applied funds provided pursuant
to this Note for purposes other than those authorized by Lender.



<PAGE>   2

                                PROMISSORY NOTE
                                  (Continued)

GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific 
default provisions or rights of Lender shall not preclude Lender's right to 
declare payment of this Note on its demand. Lender may delay or forgo enforcing 
any of its rights or remedies under this Note without losing them. Borrower and 
any other person who signs, guarantees or endorses this Note, to the extent 
allowed by law, waive any applicable statute of limitations, presentment, 
demand for payment, protest and notice of dishonor. Upon any change in the 
terms of this Note, and unless otherwise expressly stated in writing, no party 
who signs this Note, whether as maker or guarantor, accommodation maker or 
endorser, shall be released from liability. All such parties agree that Lender 
may renew or extend (repeatedly and for any length of time) this loan, or 
release any party or guarantor or collateral; or impair, fail to realize upon 
or perfect Lender's security interest in the collateral; and take any other 
action deemed necessary by Lender without the consent of or notice to anyone. 
All such parties also agree that Lender may modify this loan without the 
consent of or notice to anyone other than the party with whom the modification 
is made.

-------------------------------------------------------------------------------

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF 
THIS NOTE. BORROWER AGREES TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF 
A COMPLETED COPY OF THE NOTE.

BORROWER:

Table Mountain Band of Indians 
  of the Table Mountain Rancheria


By:  /s/ Vern Castro, Chairman
   --------------------------------
     Vern Castro, Chairman

-------------------------------------------------------------------------------

<PAGE>   3
                            BUSINESS LOAN AGREEMENT

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------
   Principal   Loan Date  Maturity  Loan No.  Call  Collateral  Account  Officer  Initials
<S>             <C>       <C>       <C>       <C>   <C>         <C>      <C>      <C>
$2,900,000.00   8/24/98   12/31/99
------------------------------------------------------------------------------------------
References in the shaded area are for Lender's use only and do not limit the applicability
of this document to any particular loan or item.
------------------------------------------------------------------------------------------

Borrower: Table Mountain Band of Indians of the     Lender: American Vantage Companies
          Table Mountain Rancheria                          6787 West Tropicana, Ste 200
          8184 Table Mountain Road                          Las Vegas, NV 89103
          Friant, CA 93626
------------------------------------------------------------------------------------------
</TABLE>

THIS BUSINESS LOAN AGREEMENT BETWEEN TABLE MOUNTAIN BAND OF INDIANS OF THE TABLE
MOUNTAIN RANCHERIA ("BORROWER") AND AMERICAN VANTAGE COMPANIES ("LENDER") IS
MADE AND EXECUTED ON THE FOLLOWING TERMS AND CONDITIONS. BORROWER HAS RECEIVED
PRIOR LOANS FROM LENDER OR HAS APPLIED TO LENDER FOR A LOAN OR LOANS AND OTHER
FINANCIAL ACCOMMODATIONS, INCLUDING THOSE WHICH MAY BE DESCRIBED ON ANY EXHIBIT
OR SCHEDULE ATTACHED TO THIS AGREEMENT. ALL SUCH LOANS AND FINANCIAL
ACCOMMODATIONS, TOGETHER WITH ALL FUTURE LOANS AND FINANCIAL ACCOMMODATIONS FROM
LENDER TO BORROWER, ARE REFERRED TO IN THIS AGREEMENT INDIVIDUALLY AS THE "LOAN"
AND COLLECTIVELY AS THE "LOANS." BORROWER UNDERSTANDS AND AGREES THAT: (a) IN
GRANTING, RENEWING OR EXTENDING ANY LOAN, LENDER IS RELYING UPON BORROWER'S
REPRESENTATIONS, WARRANTIES, AND AGREEMENTS, AS SET FORTH IN THIS AGREEMENT; (b)
THE GRANTING, RENEWING, OR EXTENDING OF ANY LOAN BY LENDER AT ALL TIMES SHALL BE
SUBJECT TO LENDER'S SOLE JUDGEMENT AND DISCRETION; AND (c) ALL SUCH LOANS SHALL
BE AND SHALL REMAIN SUBJECT TO THE FOLLOWING TERMS AND CONDITIONS OF THIS
AGREEMENT.

TERM. This Agreement shall be effective as of AUGUST 24, 1998, and shall
continue thereafter until all indebtedness of Borrower to Lender has been
performed in full and the parties terminate this Agreement in writing.

DEFINITIONS. The following words shall have the following meanings when used in
this Agreement. Terms not otherwise defined in this Agreement shall have the
meanings attributed to such terms in the Uniform Commercial Code. All references
to dollar amounts shall mean amounts in lawful money of the United States of
America.

     AGREEMENT. The word "Agreement" means this Business Loan Agreement, as this
     Business Loan Agreement may be amended or modified from time to time,
     together with all exhibits and schedules attached to this Business Loan
     Agreement from time to time.

     BORROWER. The word "Borrower" means Table Mountain Band of Indians of the
     Table Mountain Rancheria. The word "Borrower" also includes, as applicable,
     all subsidiaries and affiliates of Borrower as provided below in the
     paragraph titled "Subsidiaries and Affiliates."

     CERCLA. The word "CERCLA" means the Comprehensive Environmental Response,
     Compensation, and Liability Act of 1980, as amended.

     COLLATERAL. The word "Collateral" means and includes without limitation all
     property and assets granted as collateral security for a Loan, whether real
     or personal property, whether granted directly or indirectly, whether
     granted now or in the future, and whether granted in the form of a security
     interest, mortgage, deed of trust, assignment, pledge, chattel mortgage,
     chattel trust, factor's lien, equipment trust, conditional sale, trust
     receipt, lien, charge, lien or title retention contract, lease or
     consignment intended as a security device, or any other security or lien
     interest whatsoever whether created by law, contract, or otherwise.

     ERISA. The word "ERISA" means the Employee Retirement Income Security Act
     of 1974, as amended.

     EVENT OF DEFAULT. The words "Event of Default" means and include without
     limitation any of the Events of Default set forth below in the section
     titled "EVENTS OF DEFAULT."

     GRANTOR. The word "Grantor" means and includes without limitation each and
     all of the guarantor, sureties, and accommodation parties in connection
     with any indebtedness.

     INDEBTEDNESS. The word "indebtedness" means and includes without limitation
     all Loans, together with all other obligations, debts and liabilities of
     Borrower to Lender, or any one or more of them, as well as all claims by
     Lender against Borrower, or any one or more of them; whether now or
     hereafter existing, voluntary or involuntary, due or not due, absolute or
     contingent, liquidated or unliquidated; whether Borrower may be liable
     individually or jointly with others; whether Borrower may be obligated as a
     guarantor, surety, or otherwise; whether recovery upon such indebtedness
     may be or hereafter may become barred by any statute of limitations; and
     whether such indebtedness may be or hereafter may become otherwise
     unenforceable.

     LENDER. The word "Lender" means American Vantage Companies, its successors
     and assigns.

     LOAN. The word "Loan" or "Loans" means and includes without limitation any
     and all commercial loans and financial accommodations from Lender to
     Borrower, whether now or hereafter existing, and however evidenced,
     including without limitation those loans and financial accommodations
     described herein or described on any exhibit or schedule attached to this
     Agreement from time to time.

     NOTE. The word "Note" means and includes without limitation Borrower's
     promissory note or notes, if any, evidencing Borrower's Loan obligations in
     favor or Lender, as well as any substitute, replacement or refinancing note
     or notes therefor.

     PERMITTED LIENS. The words "Permitted Liens" mean: (a) liens and security
     interests securing indebtedness owed by Borrower to Lender; (b) liens for
     taxes, assessments, or similar charges either not yet due or being
     contested in good faith; (c) liens of materialmen, mechanics, warehousemen,
     or carriers, or other like liens arising in the ordinary course of business
     and securing obligations which are not yet delinquent; (d) purchase money
     liens or purchase money security interests upon or in any property acquired
     or held by Borrower in the ordinary course of business to secure
     indebtedness outstanding on the date of this Agreement or permitted to be
     incurred under the paragraph of this Agreement titled "Indebtedness and
     Liens"; (e) liens and security interests which, as of the date of this
     Agreement, have been disclosed to and approved by the Lender in writing;
     and (f) those liens and security interests which in the aggregate
     constitute an immaterial and insignificant monetary amount with respect to
     the net value of Borrower's assets.

     RELATED DOCUMENTS. The words "Related Documents" mean and include without
     limitation all promissory notes, credit agreements, loan agreements,
     environmental agreements, guaranties, security agreements, mortgages, deeds
     of trust, and all other instruments, agreements and documents, whether now
     or hereafter existing, executed in connection with the indebtedness.

     SECURITY AGREEMENT. The words "Security Agreement" mean and include without
     limitation any agreements, promises, covenants, arrangements,
     understandings or other agreements, whether created by law, contract, or
     otherwise, evidencing, governing, representing, or creating a Security
     Interest.

     SECURITY INTEREST. The words "Security Interest" mean and include without
     limitation any type of collateral security, whether in the form of a lien,
     charge, mortgage, deed of trust, assignment, pledge, chattel mortgage,
     chattel trust, factor's lien, equipment trust, conditional sale, trust
     receipt, lien or title retention contract, lease or consignment intended as
     security device or any other security or lien interest whatsoever, whether
     created by law, contract, or otherwise.

     SARA. The word "SARA" means the Superfund Amendments and Reauthorization
     Act of 1986 as now or hereafter amended.

CONDITIONS PRECEDENT TO EACH ADVANCE. Lender's obligation to make the initial
Loan Advance and each subsequent Loan Advance under this Agreement shall be
subject to the fulfillment to Lender's satisfaction of all of the conditions set
forth in this Agreement and in the Related Documents.

     LOAN DOCUMENTS. Borrower shall provide to Lender in form satisfactory to
     Lender the following documents for the Loan: (a) the Note; (b) Security
     Agreements granting to Lender security interests in the Collateral; (c)
     Financing Statements perfecting Lender's Security Interests; (d) evidence
     of insurance as required below; and (e) any other documents required under
     this Agreement or by Lender or its counsel.

     BORROWER'S AUTHORIZATION. Borrower shall have provided in form and
     substance satisfactory to Lender properly certified resolutions, duly
     authorizing the execution and delivery of this Agreement, the Note and the
     Related Documents, and such other authorizations and other documents and
     instruments as Lender or its counsel, in their sole discretion, may
     require.

     PAYMENT OF FEES AND EXPENSES. Borrower shall have paid to Lender all fees,
     charges, and other expenses which are then due and payable as specified in
     this Agreement or any Related Document.

<PAGE>   4
                            BUSINESS LOAN AGREEMENT
                                  (Continued)

8/24/98                                                                   Page 2
--------------------------------------------------------------------------------

     REPRESENTATIONS AND WARRANTIES. The representations and warranties set
     forth in this Agreement, in the Related Documents, and in any document or
     certificate delivered to Lender under this Agreement are true and correct.

     NO EVENT OF DEFAULT. There shall not exist at the time of any advance a
     condition which would constitute an Event of Default under this Agreement.

REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to Lender, as 
of the date of this Agreement, as of the date of each disbursement of Loan 
proceeds, as of the date of any renewal, extension or modification of any Loan, 
and at all times any indebtedness exists:

     ORGANIZATION. Borrower is a federally recognized Indian Tribe, which is
     duly organized, validly existing, and in good standing under the laws of
     the United States. Borrower has the full power and authority to own its
     properties and to transact the businesses in which it is presently engaged
     or presently proposes to engage.

     AUTHORIZATION. The execution, delivery, and performance of this Agreement
     and all Related Documents by Borrower, to the extent to be executed,
     delivered or performed by Borrower, have been duly authorized by all
     necessary action by Borrower; do not require the consent or approval of any
     other person, regulatory authority or governmental body; and do not
     conflict with, result in a violation of, or constitute a default under (a)
     any provision of its articles of incorporation or organization, or bylaws,
     or any agreement or other instrument binding upon Borrower or (b) any law,
     governmental regulation, court decree, or order applicable to Borrower.

     FINANCIAL INFORMATION. Each financial statement of Borrower supplied to
     Lender truly and completely disclosed Borrower's financial condition as of
     the date of the statement, and there has been no material adverse change in
     Borrower's financial condition subsequent to the date of the most recent
     financial statement supplied to Lender. Borrower has no material contingent
     obligations except as disclosed in such financial statements.

     LEGAL EFFECT. This Agreement constitutes, and any instrument or agreement
     required hereunder to be given by Borrower when delivered will constitute,
     legal, valid and binding obligations of Borrower enforceable against
     Borrower in accordance with their respective terms.

     PROPERTIES. Except as contemplated by this Agreement or as previously
     disclosed in Borrower's financial statements or in writing to Lender and as
     accepted by Lender, Borrower owns and has good title to all of Borrower's
     properties free and clear of all Security Interests, and has not executed
     any security documents or financing statements relating to such properties.
     All of Borrower's properties are titled in Borrower's legal name, and
     Borrower has not used, or filed a financing statement, under any other name
     for at least the last five (5) years.

     HAZARDOUS SUBSTANCES. The terms "hazardous waste," "hazardous substance,"
     "disposal," "release," and "threatened release," as used in this Agreement,
     shall have the same meanings as set forth in the "CERCLA," "SARA," the
     Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et. Seq.,
     the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et
     seq., Chapters 6.5 through 7.7 of Division 20 of the California Health and
     Safety Code, Section 25100, et seq., or other applicable state or Federal
     laws, rules, or regulations adopted pursuant to any of the foregoing.
     Except as disclosed to and acknowledged by Lender in writing, Borrower
     represents and warrants that: (a) During the period of Borrower's ownership
     of the properties, there has been no use, generation, manufacture, storage,
     treatment, disposal, release or threatened release of any hazardous waste
     or substance by any person on, under, about or from any of the properties.
     (b) Borrower has no knowledge of, or reason to believe that there has been
     (i) any use, generation, manufacture, storage, treatment, disposal,
     release, or threatened release of any hazardous waste or substance on,
     under, about or from the properties by any prior owners or occupants of any
     of the properties, or (ii) any actual or threatened litigation or claims of
     any kind by any person relating to such matters. (c) Neither Borrower nor
     any tenant, contractor, agent or other authorized user of any of the
     properties shall use, generate, manufacture, store, treat, dispose of, or
     release any hazardous waste or substance on, under, about or from any of
     the properties; and any such activity shall be conducted in compliance with
     all applicable federal, state, and local laws, regulations, and ordinances,
     including without limitation those laws, regulations and ordinances
     described above. Borrower authorizes Lender and its agents to enter upon
     the properties to make such inspections and tests as Lender may deem
     appropriate to determine compliance of the properties with this section of
     the Agreement. Any inspections or tests made by Lender shall be at
     Borrower's expense and for Lender's purposes only and shall not be
     construed to create any responsibility or liability on the part of Lender
     to Borrower or to any other person. The representations and warranties
     contained herein are based on Borrower's due diligence in investigating the
     properties for hazardous waste and hazardous substances. Borrower hereby
     (a) releases and waives any future claims against Lender for indemnity or
     contribution in the event Borrower becomes liable for cleanup or other
     costs under any such laws, and (b) agrees to indemnify and hold harmless
     Lender against any and all claims, losses, liabilities, damages, penalties,
     and expenses which Lender may directly or indirectly sustain or suffer
     resulting from a breach of this section of the Agreement or as a
     consequence of any use, generation, manufacture, storage, disposal, release
     or threatened release of a hazardous waste or substance on the properties.
     The provisions of this section of the Agreement, including the obligation
     to indemnify, shall survive the payment of the indebtedness and the
     termination or expiration of this Agreement and shall not be affected by
     Lender's acquisition of any interest in any of the properties, whether by
     foreclosure or otherwise.

     LITIGATION AND CLAIMS. No litigation, claim, investigation, administrative
     proceeding or similar action (including those for unpaid taxes) against
     Borrower is pending or threatened, and no other event has occurred which
     may materially adversely affect Borrower's financial condition or
     properties, other than litigation, claims, or other events, if any, that
     have been disclosed to and acknowledged by Lender in writing.

     TAXES. To the best of Borrower's knowledge, all tax returns and reports of
     Borrower that are or were required to be filed, have been filed, and all
     taxes, assessments and other governmental charges have been paid in full,
     except those presently being or to be contested by Borrower in good faith
     in the ordinary course of business and for which adequate reserves have
     been provided.

     LIEN PRIORITY. Unless otherwise previously disclosed to Lender in writing,
     Borrower has not entered into or granted any Security Agreements, or
     permitted the filing or attachment of any Security Interests on or
     affecting any of the Collateral directly or indirectly securing repayment
     of Borrower's Loan and Note, that would be prior or that may in any way be
     superior to Lender's Security Interests and rights in and to such
     Collateral.

     BINDING EFFECT. This Agreement, the Note, all Security Agreements directly
     or indirectly securing repayment of Borrower's Loan and Note and all of the
     Related Documents are binding upon Borrower as well as upon Borrower's
     successors, representatives and assigns, and are legally enforceable in
     accordance with their respective terms.

     COMMERCIAL PURPOSES. Borrower intends to use the Loan proceeds solely for
     business or commercial related purposes.

     EMPLOYEE BENEFIT PLANS. Each employee benefit plan as to which Borrower may
     have any liability complies in all material respects with all applicable
     requirements of law and regulations, and (i) no Reportable Event nor
     Prohibited Transaction (as defined in ERISA) has occurred with respect to
     any such plan, (ii) Borrower has not withdrawn from any such plan or
     initiated steps to do so, (iii) no steps have been taken to terminate any
     such plan, and (iv) there are no unfunded liabilities other than those
     previously disclosed to Lender in writing.

     LOCATION OF BORROWER'S OFFICES AND RECORDS. Borrower's place of business,
     or Borrower's Chief executive office, if Borrower has more than one place
     of business, is located at 8184 Table Mountain Road, Friant, CA 93626.
     Unless Borrower has designated otherwise in writing this location is also
     the office or offices where Borrower keeps its records concerning the
     Collateral.

     YEAR 2000. Borrower warrants and represents that all software utilized in
     the conduct of Borrower's business will have appropriate capabilities and
     compatibility for operation to handle calendar dates falling on or after
     January 1, 2000, and all information pertaining to such calendar dates, in
     the same manner and with the same functionality as the software does
     respecting calendar dates falling on or before December 31, 1999. Further
     Borrower warrants and represents that the data-related user interface
     functions, data-fields, and date-related program instructions and functions
     of the software include the indication of the century.

     INFORMATION. All information heretofore or contemporaneously herewith
     furnished by Borrower to Lender for the purposes of or in connection with
     this Agreement or any transaction contemplated hereby is, and all
     information hereafter furnished by or on behalf of Borrower to lender will
     be, true and accurate in every material respect on the date as of which
     such information is dated or certified; and none of such information is or
     will be incomplete by omitting to state any material fact necessary to make
     such information not misleading.

     SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Borrower understands and agrees
     that Lender, without independent investigation, is relying upon the above
     representations and warranties in making the above referenced Loan to
     Borrower. Borrower further agrees that the foregoing
<PAGE>   5

                            BUSINESS LOAN AGREEMENT
                                  (Continued)

8/24/98                                                                  Page 3
--------------------------------------------------------------------------------

     representations and warranties shall be continuing in nature and shall
     remain in full force and effect until such time as Borrower's indebtedness
     shall be paid in full, or until this Agreement shall be terminated in the
     manner provided above, whichever is the last to occur.

AFFIRMATIVE COVENANTS. Borrower covenants and agrees with Lender that, while 
this Agreement is in effect, Borrower will:

     LITIGATION. Promptly inform Lender in writing of (a) all material adverse
     changes in Borrower's financial condition, and (b) all existing and all
     threatened litigation, claims, investigations, administrative proceedings
     or similar actions affecting Borrower or any Guarantor which could
     materially affect the financial condition of Borrower or the financial
     condition of any Guarantor.

     FINANCIAL RECORDS. Maintain its books and records in accordance with
     generally accepted accounting principles, applied on a consistent basis,
     and permit Lender to examine and audit Borrower's books and records at all
     reasonable times.

     FINANCIAL STATEMENTS. Furnish Lender with, as soon as available, but in no
     event later than one hundred twenty (120) days after the end of each fiscal
     year, Borrower's balance sheet and income statement for the year ended,
     audited by a certified public accountant satisfactory to Lender. All
     financial reports required to be provided under this Agreement shall be
     prepared in accordance with generally accepted accounting principles,
     applied on a consistent basis, and certified by Borrower as being true and
     correct.

     ADDITIONAL INFORMATION. Furnish such additional information and statements,
     lists of assets and liabilities, agings or receivables and payables,
     inventory schedules, budgets, forecasts, tax returns, and other reports
     with respect to Borrower's financial condition and business operations as
     Lender may request from time to time.

     INSURANCE. Maintain fire and other risk insurance, public liability
     insurance, and such other insurance as Lender may require with respect to
     Borrower's properties and operations, in form, amounts, coverages and with
     insurance companies reasonably acceptable to Lender. Borrower, upon request
     of Lender, will deliver to Lender from time to time the policies or
     certificates of insurance in form satisfactory to Lender, including
     stipulations that coverages will not be cancelled or diminished without at
     least thirty (30) days' prior written notice to Lender. Each insurance
     policy also shall include an endorsement providing that coverage in favor
     of Lender will not be impaired in any way by any act, omission or default
     of Borrower or any other person. In connection with all policies covering
     assets in which Lender holds or is offered a security interest for the
     Loans, Borrower will provide Lender with such loss payable or other
     endorsements as Lender may require.

     INSURANCE REPORTS. Furnish to Lender, upon request of Lender, reports on
     each existing insurance policy showing such information as Lender may
     reasonably request, including without limitation the following: (a) the
     name of the insurer; (b) the risks insured; (c) the amount of the policy;
     (d) the properties insured; (e) the then current property values on the
     basis of which insurance has been obtained, and the manner of determining
     those values; and (f) the expiration date of the policy. In addition, upon
     request of Lender (however not more often than annually), Borrower will
     have an independent appraiser satisfactory to Lender determine, as
     applicable, the actual cash value or replacement cost of any Collateral.
     The cost of such appraisal shall be paid by Borrower.

     OTHER AGREEMENTS. Comply with all terms and conditions of all other
     agreements, whether now or hereafter existing, between Borrower and any
     other party and notify Lender immediately in writing of any default in
     connection with any other such agreements.

     LOAN FEES AND CHARGES.

     LOAN PROCEEDS. Use all Loan proceeds solely for Borrower's business
     operations, unless specifically consented to the contrary by Lender in
     writing.

     TAXES, CHARGES AND LIENS. Pay and discharge when due all of its
     indebtedness and obligations, including without limitation all assessments,
     taxes, governmental charges, levies and liens, of every kind and nature,
     imposed upon Borrower or its properties, income, or profits, prior to the
     date on which penalties would attach, and all lawful claims that, if
     unpaid, might become a lien or charge upon any of Borrower's properties,
     income, or profits. Provided however, Borrower will not be required to pay
     and discharge any such assessment, tax, charge, levy, lien or claim so long
     as (a) the legality of the same shall be contested in good faith by
     appropriate proceedings, and (b) Borrower shall have established on its
     books adequate reserves with respect to such contested assessment, tax,
     charge, levy, lien, or claim in accordance with generally accepted
     accounting practices. Borrower, upon demand of Lender, will furnish to
     Lender evidence of payment of the assessments, taxes, charges, levies,
     liens and claims and will authorize the appropriate governmental official
     to deliver to Lender at any time a written statement of any assessments,
     taxes, charges, levies, liens and claims against Borrower's properties,
     income, or profits.

     PERFORMANCE. Perform and comply with all terms, conditions and provisions
     set forth in this Agreement and in the Related Documents in a timely
     manner, and promptly notify Lender if Borrower learns of the occurrence of
     any event which constitutes an Event of Default under this Agreement or
     under any of the Related Documents.

     OPERATIONS. Maintain executive and management personnel with substantially
     the same qualifications and experience as the present executive and
     management personnel; provide written notice to Lender of any change in
     executive and management personnel; conduct its business affairs in a
     reasonable and prudent manner and in compliance with all applicable
     federal, state and municipal laws, ordinances, rules and regulations
     respecting its properties, charters, businesses and operations, including
     without limitation, compliance with the Americans With Disabilities Act and
     with all minimum funding standards and other requirements of ERISA and
     other laws applicable to Borrower's employee benefit plans.

     INSPECTION. Permit employees or agents of Lender at any reasonable time to
     inspect any and all Collateral for the Loan or Loans and Borrower's other
     properties and to examine or audit Borrower's books, accounts, and records
     and to make copies and memoranda of Borrower's books, accounts, and
     records. If Borrower now or at any time hereafter maintains any records
     (including without limitation computer generated records and computer
     software programs for the generation of such records) in the possession of
     a third party, Borrower, upon request of Lender, shall notify such party to
     permit Lender free access to such records at all reasonable times and to
     provide Lender with copies of any records it may request, all at Borrower's
     expense.

     COMPLIANCE CERTIFICATE. Unless waived in writing by Lender, provide Lender
     at least annually and at the time of each disbursement of Loan proceeds
     with a certificate executed by Borrower's chief financial officer, or other
     officer or person acceptable to Lender, certifying that the representations
     and warranties set forth in this Agreement are true and correct as of the
     date of the certificate and further certifying that, as of the date of the
     certificate, no Event of Default exists under this Agreement.

     ENVIRONMENTAL COMPLIANCE REPORTS. Borrower shall comply in all respects
     with all environmental protection federal, state and local laws, statutes,
     regulations and ordinances; not cause or permit to exist, as a result of an
     intentional or unintentional action or omission on its part or on the part
     of any third party, on property owned and/or occupied by Borrower, any
     environmental activity where damage may result to the environment, unless
     such environmental activity is pursuant to and in compliance with the
     conditions of a permit issued by the appropriate federal, state or local
     governmental authorities; shall furnish to Lender promptly and in any event
     within thirty (30) days after receipt thereof a copy of any notice,
     summons, lien, citation, directive, letter or other communication from any
     governmental agency or instrumentality concerning any intentional or
     unintentional action or omission on Borrower's part in connection with any
     environmental activity whether or not there is damage to the environment
     and/or other natural resources.

     ADDITIONAL ASSURANCES. Make, execute and deliver to Lender such promissory
     notes, mortgages, deeds of trust, security agreements, financing
     statements, instruments, documents and other agreements as Lender or its
     attorneys may reasonably request to evidence and secure the Loans and to
     perfect all Security Interests.

RECOVERY OF ADDITIONAL COSTS. If the imposition of or any change in any law,
rule, regulation or guideline, or the interpretation or application of any
thereof by any court or administrative or governmental authority (including any
request or policy not having the force of law) shall impose, modify or make
applicable any taxes (except U.S. federal, state or local income or franchise
taxes imposed on Lender), reserve requirements, capital adequacy requirements or
other obligations which would (a) increase the cost to Lender for extending or
maintaining the credit facilities to which this Agreement relates, (b) reduce
the amounts payable to Lender under this Agreement or the Related Documents, or
(c) reduce the rate of return on Lender's capital as a consequence of Lender's
obligations with respect to the credit facilities to which this Agreement
relates, then Borrower agrees to pay Lender such additional amounts as will
compensate Lender therefor, within five (5) days after Lender's written demand
for such payment, which demand shall be accompanied by an explanation of such
imposition or charge and a calculation in reasonable detail of the additional
amounts payable by Borrower, which explanation and calculations shall be
conclusive in the absence of manifest error.

NEGATIVE COVENANTS. Borrower covenants and agrees with Lender that while this
Agreement is in effect, Borrower shall not, without the prior written consent of
Lender:

<PAGE>   6
8-24-98                    BUSINESS LOAN AGREEMENT                       PAGE 4
                                  (Continued)
================================================================================

     INDEBTEDNESS AND LIENS. (a) Except for trade debt incurred in the normal
     course of business and indebtedness to Lender contemplated by this
     Agreement, create, incur or assume indebtedness for borrowed money,
     including capital leases, (b) except as allowed as a Permitted Lien, sell,
     transfer, mortgage, assign, pledge, lease, grant a security interest in, or
     encumber any of Borrower's assets, or (c) sell with recourse any of
     Borrower's accounts, except to Lender.

     CONTINUITY OF OPERATIONS.

     LOANS, ACQUISITIONS AND GUARANTIES. (a) Loan, invest in or advance money or
     assets, (b) purchase, create or acquire any interest in any other
     enterprise or entity, or (c) incur any obligation as surety or guarantor
     other than in the ordinary course of business.

CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to
Borrower, whether under this Agreement or under any other agreement, Lender
shall have no obligation to make Loan Advances or to disburse Loan proceeds if:
(1) Borrower or any Guarantor is in default under the terms of this Agreement or
any of the Related Documents or any other agreement that Borrower or any
Guarantor has with Lender; (b) Borrower or any Guarantor becomes insolvent,
files a position in bankruptcy or similar proceedings, or is adjudged a
bankrupt; (c) there occurs a material adverse change in Borrower's financial
condition, in the financial condition of any Guarantor, on in the value of any
Collateral securing any Loan; or (d) any Guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such Guarantor's guaranty of the Loan or any
other loan with Lender.

RIGHT OF SETOFF.

EVENTS OF DEFAULT. Each of the following shall constitute an Event of Default
under this Agreement:

     DEFAULT ON INDEBTEDNESS. Failure of Borrower to make any payment when due
     on the Loans.

     OTHER DEFAULTS. Failure of Borrower or any Grantor to comply with or to
     perform when due any other term, obligation, covenant or condition
     contained in this Agreement or in any of the Related Documents, or failure
     of Borrower to comply with or to perform any other term, obligation,
     covenant or condition contained in any other agreement between Lender and
     Borrower.

     DEFAULT IN FAVOR OF THIRD PARTIES. Should Borrower or any Grantor default
     under any loan, extension of credit, security agreement, purchase or sales
     agreement, or any other agreement, in favor of any other creditor or person
     that may materially affect any of Borrower's property or Borrower's or any
     Grantor's ability to repay the Loans or perform their respective
     obligations under this Agreement or any of the Related Documents.

     FALSE STATEMENTS. Any warranty, representation or statement made or
     furnished to Lender by or on behalf of Borrower or any Grantor under this
     Agreement or the Related Documents is false or misleading in any material
     respect at the time made or furnished, or becomes false or misleading at
     any time thereafter.

     DEFECTIVE COLLATERALIZATION. This Agreement or any of the Related Documents
     ceases to be in full force and effective (including failure of any Security
     Agreement to create a valid and perfected Security Interest) at any time
     and for any reason.

     INSOLVENCY. The dissolution or termination of Borrower's existence as a
     going business, the insolvency of Borrower, the appointment of a receiver
     for any part of Borrower's property, any assignment for the benefit of
     creditors, any type of creditor workout, or the commencement of any
     proceeding under any bankruptcy or insolvency laws by or against Borrower.

     CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or
     forfeiture proceedings, whether by judicial proceeding, self-help,
     repossession or any other method, by any creditor of Borrower, any creditor
     of any Grantor against any collateral securing the indebtedness, or by any
     governmental agency. This includes a garnishment, attachment, or levy on or
     of any of Borrower's deposit accounts with Lender. However, this Event of
     Default shall not apply if there is a good faith dispute by Borrower or
     Grantor, as the case may be, as to the validity or reasonableness of the
     claim which is the basis of the creditor or forfeiture proceeding, and if
     Borrower or Grantor gives Lender written notice of the creditor or
     forfeiture proceeding and furnishes reserves or a surety bond for the
     creditor or forfeiture proceeding satisfactory to Lender.

     EVENTS AFFECTING GUARANTOR. Any of the proceeding events occurs with
     respect to any Guarantor of any of the indebtedness or any Guarantor dies
     or becomes incompetent, or revokes or disputes the validity of, or
     liability under, any Guaranty of the indebtedness. Lender, at its option,
     may, but shall not be required to, permit the Guarantor's estate to assume
     unconditionally the obligations arising under the guaranty in a manner
     satisfactory to Lender, and, in doing so, cure the Event of Default.

     CHANGE IN OWNERSHIP.

     ADVERSE CHANGE. A material adverse change occurs in Borrower's financial
     condition, or Lender believes the prospect of payment or performance of the
     indebtedness is impaired.

     RIGHT TO CURE. If any default, other than a Default on Indebtedness, is
     curable and if Borrower or Grantor, as the case may be, has not been given
     a notice of a similar default within the preceding twelve (12) months, it
     may be cured (an no Event of Default will have occurred) if Borrower or
     Grantor, as the case may be, after receiving written notice from Lender
     demanding cure of such default; (a) cures the default within fifteen (15)
     days; or (b) if the cure requires more than fifteen (15) days, immediately
     initiates steps which Lender deems in Lender's sole discretion to be
     sufficient to cure the default and thereafter continues and completes all
     reasonable and necessary steps sufficient to produce compliance as soon as
     reasonably practical.

EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall occur, except where
otherwise provided in this Agreement or the Related Documents, all commitments
and obligations of Lender under this Agreement or the Related Documents or any
other agreement immediately will terminate and, at Lender's option, all
indebtedness immediately will become due and payable, all without notice of any
kind to Borrower, except that in the case of an Event of Default of the type
described in the "Insolvency" subsection above, such acceleration shall be
automatic and not optional. In addition, Lender shall have all the rights and
remedies provided in the Related Documents or available at law, in equity, or
otherwise. Except as may be prohibited by applicable law, all of Lender's rights
and remedies shall be cumulative and may be exercised singularly or
concurrently. Election by Lender to pursue any remedy shall not exclude pursuit
of any other remedy, and an election to make expenditures or to take action to
perform an obligation of Borrower or of any Grantor shall not affect Lender's
right to declare a default and to exercise its rights and remedies.

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Agreement:

     AMENDMENTS. This Agreement, together with any Related Documents,
     constitutes the entire understanding and agreement of the parties as to the
     matters set forth in this Agreement. No alternation of or amendment to this
     Agreement shall be effective unless given in writing and signed by the
     party or parties sought to be charged or bound by the alteration or
     amendment.

     APPLICABLE LAW. THIS AGREEMENT HAS BEEN DELIVERED TO LENDER AND ACCEPTED BY
     LENDER IN THE STATE OF CALIFORNIA. THIS AGREEMENT SHALL BE GOVERNED BY AND
     CONSTRUED IN ACCORDANCE WITH THE ADDENDUM ATTACHED TO THE PROMISSORY NOTE
     AND MADE A PART HEREOF.

     CAPTION HEADINGS. Caption headings in this Agreement are for convenience
     purposes only and are not to be used to interpret or define the provisions
     of this Agreement.

<PAGE>   7
                            BUSINESS LOAN AGREEMENT
                                  (CONTINUED)
8/24/98                                                               PAGE 5

-----------------------------------------------------------------------------

CONSENT TO LOAN PARTICIPATION.  Borrower agrees and consents to Lender's sale 
or transfer, whether now or later, of one or more participation interests in 
the Loans to one or more purchasers, whether related or unrelated to Lender. 
Lender may provide, without any limitation whatsoever, to any one or more 
purchasers, or potential purchasers, any information or knowledge Lender may 
have about Borrower or about any other matter relating to the Loan, and 
Borrower hereby waives any rights to privacy it may have with respect to such 
matters. Borrower additionally waives any and all notices of sale of 
participation interests, as well as all notices of any repurchase of such 
participation interests. Borrower also agrees that the purchasers of any such 
participation interests will be considered as the absolute owners of such 
interests in the Loans and will have all the rights granted under the 
participation agreement or agreements governing the sale of such participation 
interests. Borrower further waives all rights of offset or counterclaim that it 
may have now or later against Lender or against any purchaser of such a 
participation interest and unconditionally agrees that either Lender or such 
purchaser may enforce Borrower's obligation under the Loans irrespective of the 
failure or insolvency of any holder of any interest in the Loans. Borrower 
further agrees that the purchaser of any such participation interests may 
enforce its interests irrespective of any personal claims or defenses that 
Borrower may have against Lender.

COSTS AND EXPENSES.  Borrower agrees to pay upon demand all of Lender's 
expenses, including without limitation attorneys' fees, incurred in connection 
with the preparation, execution, enforcement, modification and collection of 
this Agreement or in connection with the Loans made pursuant to this Agreement. 
Lender may pay someone else to help collect the Loans and to enforce this 
Agreement, and Borrower will pay that amount. This includes, subject to any 
limits under applicable law, Lender's attorneys' fees and Lender's legal 
expenses, whether or not there is a lawsuit, including attorneys' fees for 
bankruptcy proceedings (including efforts to modify or vacate any automatic 
stay or injunction), appeals, and any anticipated post-judgment collection 
services. Borrower also will pay any court costs, in addition to all other sums 
provided by law.

NOTICES.  All notices required to be given under this Agreement shall be given 
in writing, may be sent by telefacsimile (unless otherwise required by law), 
and shall be effective when actually delivered or when deposited with a 
nationally recognized overnight courier or deposited in the United States mail, 
first class, postage prepaid, addressed to the party to whom the notice is to 
be given at the address shown above. Any party may change its address for 
notices under this Agreement by giving formal written notice to the other 
parties, specifying that the purpose of the notice is to change the party's 
address. To the extent permitted by applicable law, if there is more than one 
Borrower, notice to any Borrower will constitute notice to all Borrowers. For 
notice purposes, Borrower will keep Lender informed at all times of 
Borrower's current address(es).

SEVERABILITY.  If a court of competent jurisdiction finds any provision of this 
Agreement to be invalid or unenforceable as to any person or circumstance, such 
finding shall not render that provision invalid or unenforceable as to any 
other persons or circumstances. If feasible, any such offending provision shall 
be deemed to be modified to be within the limits of enforceability or validity; 
however, if the offending provision cannot be so modified, it shall be stricken 
and all other provisions of this Agreement in all other respects shall remain 
valid and enforceable.

SUBSIDIARIES AND AFFILIATES OF BORROWER.  To the extent the context of any 
provisions of this Agreement makes it appropriate, including without limitation 
any representation, warranty or covenant, the word "Borrower" as used herein 
shall include all subsidiaries and affiliates of Borrower. Notwithstanding the 
foregoing however, under no circumstances shall this Agreement be construed to 
require Lender to make any Loan or other financial accommodation to any 
subsidiary or affiliate of Borrower.

SUCCESSORS AND ASSIGNS.  All covenants and agreements contained by or on behalf 
of Borrower shall bind its successors and assigns and shall inure to the 
benefit of Lender, its successors and assigns. Borrower shall not, however, 
have the right to assign its rights under this Agreement or any interest 
therein, without the prior written consent of Lender.

SURVIVAL.  All warranties, representations, and covenants made by Borrower in 
this Agreement or in any certificate or other instrument delivered by Borrower 
to Lender under this Agreement shall be considered to have been relied upon by 
Lender and will survive the making of the Loan and delivery to Lender of the 
Related Documents, regardless of any Investigation made by Lender or on 
Lender's behalf.

TIME IS OF THE ESSENCE.  Time is of the essence in the performance of this 
Agreement.

WAIVER.  Lender shall not be deemed to have waived any rights under this 
Agreement unless such waiver is given in writing and signed by Lender. No delay 
or omission on the part of Lender in exercising any right shall operate as a 
waiver of such right or any other right. A waiver by Lender of a provision of 
this Agreement shall not prejudice or constitute a waiver of Lender's right 
otherwise to demand strict compliance with that provision or any other 
provision of this Agreement. No prior waiver by Lender, nor any course of 
dealing between Lender and Borrower, or between Lender and any Grantor, shall 
constitute a waiver of any of Lender's rights or of any obligations of Borrower 
or of any Grantor as to any future transactions. Whenever the consent of Lender 
is required under this Agreement, the granting of such consent by Lender in any 
instance shall not constitute continuing consent in subsequent instances where 
such consent is required, and in all cases such consent may be granted or 
withheld in the sole discretion of Lender.

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN 
AGREEMENT, AND BORROWER AGREES TO ITS TERMS. THIS AGREEMENT IS DATED AS OF JULY 
15, 1998.

BORROWER:

TABLE MOUNTAIN BAND OF INDIANS OF THE TABLE MOUNTAIN RANCHERIA

By: /s/ Vern Castro
    -------------------------------------
    VERN CASTRO, CHAIRMAN


LENDER:

AMERICAN VANTAGE COMPANIES

By: /s/ Ronald J. Tassinari
    --------------------------------------
    RONALD J. TASSINARI, PRESIDENT AND CEO


<PAGE>   8
                                    ADDENDUM

THIS ADDENDUM is executed on August 24, 1998 by and between AMERICAN VANTAGE
COMPANIES (Herein "Lender"), TABLE MOUNTAIN BAND OF INDIANS OF THE TABLE
MOUNTAIN RANCHERIA, (herein "Tribe")(Borrower), and is with reference to the 
following specific documents, all of which are dated August 24, 1998, to wit:

     A. $2,900,000 promissory note, executed by borrower, as promissors, and 
     which is payable to the order of Lender (herein "Promissory Note")

     B. Business Loan Agreement, executed by Borrower

     This addendum is executed by the parties simultaneously with the execution 
of the above-described specific documents.

     The parties agree that all references to "Corporation" or "Borrower" in 
the above documents or any other documents dated August 24, 1998, relating to 
this agreement, will in fact mean TABLE MOUNTAIN BAND OF INDIANS OF THE TABLE 
MOUNTAIN RANCHERIA, a federally recognized Indian Tribe.

     The parties agree that all references to secretary or assistant secretary 
in the above documents or any other documents dated August 24, 1998, relating 
to this agreement, will in fact mean Chairman or Vice Chairman.

     The parties agree that the provisions of this Addendum are intended to, 
and shall amend said documents as hereinafter set forth. If there is any 
conflict between the terms and provisions on any of said above-described 
documents, and the terms of this Addendum, this Addendum shall control.

LIMITED WAIVER OF SOVEREIGN IMMUNITY. If the parties to this agreement are 
unable to resolve any dispute arising under the Agreement, the matter shall be 
submitted to binding arbitration in accordance with the commercial arbitration 
rules of the American Arbitration Association. Any party desiring arbitration 
shall give the other party ten-(10) days' notice of intent to arbitrate. The 
decision of the arbitrator or arbitrators shall be binding upon all parties and 
shall be subject to enforcement in any court of competent jurisdiction. The 
tribe hereby expressly waives its sovereign immunity from suit should an action 
be commenced on this Note or regarding subject matter of this Note; provided 
that this waiver and consent is not, and shall not be deemed to be, a consent 
by Tribe to the levy of any judgment, lien or attachment upon any property or 
income of Tribe other than that specifically pledged and assigned in the Loan 
Agreement, and the Security Agreement. This limited waiver of sovereign 
immunity shall extend both to the entry of judgment enforcing the award and to 
the enforcement of collection of judgment. The limited waiver applies only to 
remedies against, and assets of, the Borrower, including Gross Casino Revenues, 
and shall not otherwise operate as a waiver by the Table Mountain Rancheria, a 
federally recognized Indian tribe, for any other purpose. No Rancheria assets 
(other than those

<PAGE>   9
listed in this Agreement) shall be subject to collection in satisfaction of any 
judgment entered hereunder against Borrower. The limited waiver shall commence 
as of the effective date of this Agreement and shall continue only until the 
date upon which all of Grantor and Borrower's obligations under the Agreement 
have been discharged and satisfied (whether or not the term of the Agreement 
has expired). This agreement may not be rescinded or amended except with the 
prior written approval of the Lender; and shall be subject to the governing 
laws as set forth above.

TABLE MOUNTAIN BAND OF INDIANS OF THE TABLE
MOUNTAIN RANCHERIA

By: /s/ 
   -----------------------------------

Dated: 8/24/98
      --------------------------------


AMERICAN VANTAGE COMPANIES

By: /s/ 
   ----------------------------------

Dated: 8-24-98
      -------------------------------