<PAGE>

                                                                     EXHIBIT 4.9

                           HINES HORTICULTURE, INC.

                          FIFTH AMENDMENT AND CONSENT
                              TO CREDIT AGREEMENT


         This FIFTH AMENDMENT AND CONSENT TO CREDIT AGREEMENT (this "Amendment")
is dated as of November 14, 1996 and entered into by and among HINES
HORTICULTURE, INC. (formerly known as Hines Nurseries Inc.), a California
corporation ("Company"), SUN GRO HORTICULTURE INC., a Nevada corporation ("Sun
Gro"), and SUN GRO HORTICULTURE CANADA LTD., a Canadian corporation ("Sun Gro
Canada"; together with Company and Sun Gro, collectively, "Borrowers"), the
financial institutions listed on the signature pages hereof ("Lenders") and BT
COMMERCIAL CORPORATION, as Agent for Lenders ("Agent"), and, for purposes of
Section 6 hereof, the Credit Support Parties (as defined in Section 6 hereof)
listed on the signature pages hereof, and is made with reference to that certain
Credit Agreement dated as of August 4, 1995 by and among Company, Sun Gro and
Sun Gro Canada, Lenders and Agent, as amended by that certain First Amendment
dated as of October 11, 1995, that certain Second Amendment dated as of October
26, 1995, that certain Third Amendment dated as of March 15, 1996, and that
certain Fourth Amendment dated as of August 28, 1996 (as so amended, the "Credit
Agreement"). Capitalized terms used herein without definition shall have the
same meanings herein as set forth in the Credit Agreement.


                                   RECITALS

         WHEREAS, Borrowers and Lenders desire to amend the Credit Agreement to
(i) increase the aggregate Revolving Loan Commitments by $10 million (from $50
million to $60 million), (ii) adjust certain of the financial covenants set
forth therein, and (iii) make certain other amendments as set forth below; and

         WHEREAS, Company has requested that Lenders consent to the acquisition
by Company of all of the issued and outstanding shares of capital stock of Flynn
Nurseries, Inc. ("FN"), Flynn Rainbow Nurseries, Inc. ("FRN"), a wholly-owned
Subsidiary of FN, and FRN, Inc., a wholly-owned Subsidiary of FRN; and

         WHEREAS, subject to the terms and conditions of this Amendment, Lenders
are willing to agree to such amendments and consent to such acquisition.

         NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

                                       1
<PAGE>

         Section 1.  AMENDMENTS TO THE CREDIT AGREEMENT.

         1.1  Amendments to Section 1: Provisions Relating to Defined Terms

         A.   Subsection 1.1 of the Credit Agreement is hereby amended by adding
thereto the following definitions, which shall be inserted in the proper
alphabetical order:

         "'Fifth Amendment' means that certain Fifth Amendment and Consent to
    Credit Agreement dated as of November 14, 1996 among Holdings, Borrowers,
    FN, FRN, FRN, Inc., Agent and Lenders."

         "'Fifth Amendment Effective Date' has the meaning assigned to that term
    in the Fifth Amendment."

         "'FII' means Flynn Industries, Inc., a Nevada corporation."

         "'Flynn Acquisition' means the acquisition by Company of all of the
    issued and outstanding shares of capital stock of FN and each of FN's
    Subsidiaries pursuant to the Flynn Acquisition Agreements."

         "'Flynn Acquisition Agreements' means collectively, (i) the Flynn Stock
    Purchase Agreement, (ii) that certain Escrow Agreement dated as of November
    27, 1996 among Company, FII, the other stockholders of FN and an escrow
    agent, (iii) that certain non-competition agreement dated as of November 27,
    1996 by and among FII, Donald Flynn, FN and FRN, (iv) the Flynn Oregon
    Agreements, (v) the New Preferred Stock Purchase Agreement, (vi) the New
    Warrants, and (vii) any agreement or document entered into by any Loan Party
    in connection with any of the foregoing, in each case (for clauses (i)
    through (vii) above) as any such agreement or document may be amended from
    time to time after the Fifth Amendment Effective Date to the extent
    permitted by subsection 7.15 or 8.17."

         "'Flynn Oregon Agreements' means (i) that certain Custom Farming
    Agreement dated as of November 27, 1996, entered into by and between FRNO
    and FRN, pursuant to the Flynn Stock Purchase Agreement and (ii) that
    certain Equipment and Inventory Purchase Agreement dated as of November 27,
    1996 by and between FRNO and FRN."

         "'Flynn Purchase Option Payments' means the Consolidated Capital
    Expenditures by FRN in connection with its exercise of the purchase options
    with respect to the Real Property Assets described in Schedule 3.31 annexed
    to the Flynn Stock Purchase Agreement and costs relating thereto."

         "'Flynn Stock Purchase Agreement' means that certain Stock Purchase
    Agreement dated as of November 27, 1996 by and among FII, certain individual

                                       2
<PAGE>

     stockholders of FN and Company, as such agreement may be amended from time
     to time after the Fifth Amendment Effective Date to the extent permitted
     under subsection 7.15."

         "'FN' means Flynn Nurseries, Inc., a California corporation."

         "'FRN' means Flynn Rainbow Nurseries, Inc., a Hawaii corporation."

         "'FRN, Inc.' means FRN, Inc., a California corporation."

         "'FRNO' means Flynn Rainbow Nurseries (Oregon), Inc."

         "'New Preferred Stock Holders' means Madison Dearborn Capital Partners,
    L.P., California State Teachers Retirement System, Chillmark Fund II, L.P.
    and Abbott Co-Investment, L.L.C."

         "'New Preferred Stock Purchase Agreement' means that certain Purchase
    Agreement dated as of November 27, 1996 by and among Holdings and New
    Preferred Stock Holders, as such agreement may be amended from time to time
    after the Fifth Amendment Effective Date to the extent permitted under
    subsection 8.17."

         "'New Warrants' means those warrants dated as of November 27, 1996
    issued by Holdings to the New Preferred Stock Holders, which warrants, if
    exercised, represent approximately 7.5% of the outstanding Holdings Common
    Stock on a fully diluted basis, and any warrants issued in replacement of or
    in substitution for such warrants, in each case as such warrants may be
    amended from time to time after the Fifth Amendment Effective Date to the
    extent permitted under subsection 8.17."


         B.   Subsection 1.1 of the Credit Agreement is hereby further amended
by deleting the definition of "Company Borrowing Base" therefrom in its entirety
and substituting the following therefor:

              "'Company Borrowing Base' means, as at any date of determination,
    an aggregate amount equal to:

              (i)   eighty-five percent (85%) of Eligible Accounts Receivable of
         Company and FRN plus

              (ii)  the lesser of (a) fifty percent (50%) of Eligible Inventory
         of Company and FRN and (b) an amount which, when aggregated with the
         amount calculated pursuant to clause (ii) of the definition of Sun Gro
         Borrowing Base (as set forth in the most recent Borrowing Base
         Certificate

                                       3
<PAGE>

         delivered to Agent) at such date of determination, equals $30,000,000
         (it being understood that the amount calculated pursuant to this clause
         (ii) and the amount calculated pursuant to clause (ii) of the
         definition of Sun Gro Borrowing Base shall not at any time exceed
         $30,000,000), minus

              (iii)  the aggregate amount of reserves, if any, established by
         Agent in the exercise of its Permitted Discretion against Eligible
         Accounts Receivable and Eligible Inventory of Company and FRN;

    provided that Agent, in the exercise of its Permitted Discretion, may (a)
    increase or decrease reserves against Eligible Accounts Receivable and
    Eligible Inventory of Company and FRN and (b) reduce the advance rates
    provided in this definition, or restore such advance rates to any level
    equal to or below the advance rates in effect as of the Closing Date."

         C.  Subsection 1.1 of the Credit Agreement is hereby further amended by
adding after the reference to "Company" appearing in the first line of the
definition of "Eligible Accounts Receivable" the word, "FRN".

         D.  Subsection 1.1 of the Credit Agreement is hereby further amended by
deleting the first sentence of the definition of "Eligible Inventory" in its
entirety and substituting therefor the following:

                "'Eligible Inventory' means, with respect to Company, FRN or Sun
     Gro, the aggregate amount of Inventory of such Loan Party deemed by Agent
     in the exercise of its Permitted Discretion to be eligible for inclusion in
     the calculation of the Borrowing Base minus, in the case of Eligible
     Inventory of Company or FRN, the Inventory Scrap Reserve."

         E.  Subsection 1.1 of the Credit Agreement is hereby further amended by
inserting the phrase "or FRN" after each reference to "Company" appearing in the
definition of "Inventory Scrap Reserve" and inserting the phrase "or FRN's"
after the reference to "Company's" appearing in such definition.

         F.   Subsection 1.1 of the Credit Agreement is hereby further amended
by inserting the phrase ", the Flynn Acquisition Agreements, the Iverson
Acquisition Agreements," after the reference to "the Acquisition Agreement,"
appearing in the first line of the definition of "Related Agreements."

         1.2    Amendment to Section 2:  Amounts and Terms of Commitments and
Loans

         Subsection 2.1A(iii) of the Credit Agreement is hereby amended by
deleting the reference to "$50,000,000" contained therein and substituting
"$60,000,000" therefor.

                                       4
<PAGE>

         1.3   Amendments to Section 5:  Representations and Warranties

         A.   Takeout Securities Indenture.  Subsection 5.2E is hereby amended
by adding the following at the end of subsection 5.2E(iii):

         "The Loans and all other monetary obligations of Company under the
         Credit Agreement and the other Loan Documents, including reimbursement
         obligations with respect to the Letters of Credit, constitute `Senior
         Debt' and `Designated Senior Debt' as defined in the Takeout Securities
         Indenture and are senior to Company's obligations under the Takeout
         Securities Indenture. The Loans and all other monetary obligations of
         Holdings, Sun Gro and any other Loan Party (other than Company) under
         the Credit Agreement and the other Loan Documents, including
         reimbursement obligations with respect to the Letters of Credit,
         constitute `Guarantor Senior Debt' and `Designated Senior Debt' as
         defined in the Takeout Securities Indenture and are senior to
         Holdings', Sun Gro's and such Loan Parties' obligations under the
         Takeout Securities Indenture."

         B.   Flynn Stock Purchase Agreement.  Section 5 of the Credit Agreement
is hereby amended by adding thereto at the end thereof the following:

         "5.18  Flynn Stock Purchase Agreement.

              A.  Company has delivered to Lenders complete and correct copies
         of the Flynn Acquisition Agreements and of all exhibits and schedules
         thereto.

              B.  Except to the extent otherwise set forth herein or in the
         schedules thereto, each of the representations and warranties given by
         FN Shareholders (as defined therein) to Company in the Flynn Stock
         Purchase Agreement is true and correct in all material respects as of
         the Fifth Amendment Effective Date, subject to the qualifications set
         forth in the schedules to the Flynn Stock Purchase Agreement.

              C.  Each of the representations and warranties given by Company to
         FN Shareholders (as defined therein) in the Flynn Stock Purchase
         Agreement is true and correct in all material respects as of the Fifth
         Amendment Effective Date.

              D.  Notwithstanding anything in the Flynn Stock Purchase Agreement
         to the contrary, the representations and warranties of Borrowers set
         forth in subsections 5.18B and 5.18C shall, solely for purposes of this
         Agreement, survive the Fifth Amendment Effective Date for the benefit
         of Lenders."

                                       5
<PAGE>

         C.  No Material Adverse Change.  Section 5.4 is hereby amended by
adding after "Since December 21, 1994" the following: "and except as set forth
on Schedule 5.4".

         D.   Employee Benefit Plans.  Section 5.11D is hereby amended by
deleting the reference to "$400,000" contained therein and substituting
"$600,000" therefor.

         1.4  Amendments to Section 6:  Borrower's Affirmative Covenants

         A.   Supplemental Actions.  Subsection 6.10 of the Credit Agreement is
hereby amended by adding the following at the end of Subsection 6.10:

              "G.  Borrowers shall deliver to Agent, within 45 days after the
         Fifth Amendment Effective Date, (i) certificates of insurance naming
         Agent on behalf of Lenders as loss payee under all casualty insurance
         policies maintained by FN, FRN or FRN, Inc., and as an additional
         insured under all liability and business interruption insurance
         policies maintained by FN, FRN or FRN, Inc., all as required pursuant
         to Subsection 6.4 or pursuant to the Collateral Documents (which
         certificates of insurance shall contain such endorsements as are
         reasonably requested by Agent), (ii) certificates of title with respect
         to all rolling stock of FN, FRN or FRN, Inc. and the taking of all
         actions necessary to cause Agent to be noted as lienholder thereon or
         otherwise necessary to perfect the first priority Lien granted to Agent
         on behalf of Lenders in such rolling stock, and (iii) Lock Box
         Agreement or Blocked Account Agreement executed by each person that is
         a party thereto with respect to each Deposit Account of FN, FRN or FRN,
         Inc.

              H. Borrowers hereby represent that FRN, Inc. does not own assets
         exceeding $5,000 in the aggregate and does not have any Indebtedness or
         Contingent Obligations (other than under the Loan Documents).
         Borrowers hereby covenant that FRN, Inc. shall not at any time own any
         assets in excess of $5,000 in the aggregate and that FRN, Inc. shall
         not at any time have any Indebtedness or Contingent Obligations (other
         than under the Loan Documents).  Borrowers hereby covenant that they
         shall cause FRN, Inc. to be merged with and into FRN (with FRN become
         the surviving corporation) within 30 days of the Fifth Amendment
         Effective Date, with the terms and documents relating to such merger
         being in form and substance satisfactory to Agent in all respects (it
         being understood that failure to comply with such covenant shall be an
         immediate Event of Default)."

         B.   Additional Mortgages.  Subsection 6.12 of the Credit Agreement is
hereby amended by deleting the parenthetical language which appears immediately
after

                                       6
<PAGE>

the reference to "as soon as practicable after the acquisition of such Covered
Real Property Asset" contained in clause (ii) therein and substituting therefor
the following:

              "(and (w) in the case of any Covered Real Property Asset acquired
         in connection with the Iverson Acquisition, as soon as practicable
         after the consummation of the Iverson Acquisition but in any event
         within ninety days after the effective date of the Fourth Amendment,
         Consent and Waiver to Credit Agreement dated as of August 28, 1996 by
         and among Company, Sun Gro, Sun Gro Canada, Lenders and Agent (the
         "Fourth Amendment Effective Date"), (x) in the case of any Covered Real
         Property which is a Material Leasehold acquired in connection with the
         Flynn Acquisition, to the extent any Loan Party shall have obtained the
         applicable landlord consents necessary to encumber such Material
         Leasehold, as soon as practicable after the consummation of the Flynn
         Acquisition but in any event within sixty days after the Fifth
         Amendment Effective Date (it being understood that with respect to each
         such Material Leasehold, the Loan Parties shall use their reasonable
         best efforts to deliver all landlord and any other third party consents
         necessary to encumber such Material Leasehold within such sixty day
         period); provided, however, that if Agent or its counsel do not deliver
         initial drafts of such Additional Mortgages on or before thirty days
         after the Fifth Amendment Effective Date, the time period for executing
         and delivering such Additional Mortgages shall be extended (beyond such
         sixty day period) by one day for each day past such thirty day period
         until Agent or its counsel deliver such initial drafts, (y) in the case
         of any Covered Real Property Asset which is a Fee Property acquired in
         connection with the Flynn Acquisition, as soon as practicable after the
         consummation of the Flynn Acquisition but in any event within forty-
         five days after the Fifth Amendment Effective Date; provided, however,
         that if Agent or its counsel do not deliver initial drafts of such
         Additional Mortgages on or before thirty days after the Fifth Amendment
         Effective Date, the time period for executing and delivering such
         Additional Mortgages shall be extended (beyond such forty-five day
         period) by one day for each day past such thirty day period until Agent
         or its counsel deliver such initial drafts and (z) in the case of any
         Covered Real Property Asset acquired in connection with the exercise of
         any purchase options with respect to any Real Property Asset leased by
         Company or any of its Subsidiaries as of the Fifth Amendment Effective
         Date, as soon as practicable after such exercise of such purchase
         option but in any event within forty-five days after the date of
         acquisition of such Real Property Asset in connection with such
         exercise; provided, however, that if Agent or its counsel do not
         deliver initial drafts of such Additional Mortgages on or before thirty
         days after the Fifth Amendment Effective Date, the time period for
         executing and delivering such Additional Mortgages shall be extended
         (beyond such forty-five day

                                       7
<PAGE>

         period) by one day for each day past such thirty day period until Agent
         or its counsel deliver such initial drafts)".

         1.5  Amendment to Subsection 7.6:  Financial Covenants

         A.   Minimum Interest Coverage Ratio.  Subsection 7.6A of the Credit
Agreement is hereby amended by deleting the table contained therein in its
entirety and substituting the following therefor:


<TABLE>
<CAPTION>
                                                 Minimum
                         "Period                 Interest Coverage Ratio
                 ------------------------        -----------------------
<S>              <C>                             <C>
                 3rd Fiscal Quarter, 1995        1.65:1.00
                 4th Fiscal Quarter, 1995        1.65:1.00
                 1st Fiscal Quarter, 1996        1.50:1.00
                 2nd Fiscal Quarter, 1996        1.50:1.00
                 3rd Fiscal Quarter, 1996        1.50:1.00
                 4th Fiscal Quarter, 1996        1.45:1.00
                 1st Fiscal Quarter, 1997        1.45:1.00
                 2nd Fiscal Quarter, 1997        1.55:1.00
                 3rd Fiscal Quarter, 1997        1.55:1.00
                 4th Fiscal Quarter, 1997        1.55:1.00
                 1st Fiscal Quarter, 1998        1.55:1.00
                 2nd Fiscal Quarter, 1998        1.70:1.00
                 3rd Fiscal Quarter, 1998        1.70:1.00
                 4th Fiscal Quarter, 1998        1.75:1.00
                 1st Fiscal Quarter, 1999        1.85:1.00
                 2nd Fiscal Quarter, 1999        1.90:1.00
                 3rd Fiscal Quarter, 1999        1.90:1.00
                 4th Fiscal Quarter, 1999        1.95:1.00
                 1st Fiscal Quarter, 2000        2.00:1.00
                 2nd Fiscal Quarter, 2000        2.10:1.00
                 3rd Fiscal Quarter, 2000        2.10:1.00
                 4th Fiscal Quarter, 2000
                     and each Fiscal
                     Quarter thereafter          2.20:1.00"

</TABLE>
         B.   Maximum Leverage Ratio. Subsection 7.6B of the Credit Agreement is
hereby amended by deleting the table contained therein in its entirety and
substituting the following therefor:

                                       8
<PAGE>


<TABLE>
<CAPTION>

                         "Period                 Maximum Leverage Ratio
                 ------------------------        ----------------------
<S>              <C>                             <C>
                  3rd Fiscal Quarter, 1995            5.25:1.00
                  3rd Fiscal Quarter, 1995            5.25:1.00
                  4th Fiscal Quarter, 1995            5.60:1.00
                  1st Fiscal Quarter, 1996            6.50:1.00
                  2nd Fiscal Quarter, 1996            5.60:1.00
                  3rd Fiscal Quarter, 1996            6.25:1.00
                  4th Fiscal Quarter, 1996            6.40:1.00
                  1st Fiscal Quarter, 1997            7.00:1.00
                  2nd Fiscal Quarter, 1997            5.75:1.00
                  3rd Fiscal Quarter, 1997            5.75:1.00
                  4th Fiscal Quarter, 1997            5.75:1.00
                  1st Fiscal Quarter, 1998            6.35:1.00
                  2nd Fiscal Quarter, 1998            5.10:1.00
                  3rd Fiscal Quarter, 1998            5.10:1.00
                  4th Fiscal Quarter, 1998            5.10:1.00
                  1st Fiscal Quarter, 1999            5.60:1.00
                  2nd Fiscal Quarter, 1999            4.50:1.00
                  3rd Fiscal Quarter, 1999            4.50:1.00
                  4th Fiscal Quarter, 1999            4.50:1.00
                  1st Fiscal Quarter, 2000            5.00:1.00
                  2nd Fiscal Quarter, 2000            4.00:1.00
                  3rd Fiscal Quarter, 2000            4.00:1.00
                  4th Fiscal Quarter, 2000
                     and each Fiscal
                     Quarter thereafter               4.00:1.00"

</TABLE>
         C.   Minimum Consolidated Adjusted EBITDA.  Subsection 7.6C of the
Credit Agreement is hereby amended by deleting the table contained therein in
its entirety and substituting the following therefor:

                                       9
<PAGE>

<TABLE>
<CAPTION>
                                                 Minimum Consolidated
                         "Period                    Adjusted EBITDA
                 ------------------------        --------------------
<S>              <C>                             <C>
                  3rd Fiscal Quarter, 1995            $30,500,000
                  4th Fiscal Quarter, 1995            $31,000,000
                  1st Fiscal Quarter, 1996            $31,000,000
                  2nd Fiscal Quarter, 1996            $31,000,000
                  3rd Fiscal Quarter, 1996            $29,000,000
                  4th Fiscal Quarter, 1996            $29,000,000
                  1st Fiscal Quarter, 1997            $29,500,000
                  2nd Fiscal Quarter, 1997            $32,000,000
                  3rd Fiscal Quarter, 1997            $32,000,000
                  4th Fiscal Quarter, 1997            $32,250,000
                  1st Fiscal Quarter, 1998            $32,500,000
                  2nd Fiscal Quarter, 1998            $35,000,000
                  3rd Fiscal Quarter, 1998            $35,000,000
                  4th Fiscal Quarter, 1998            $36,000,000
                  1st Fiscal Quarter, 1999            $37,250,000
                  2nd Fiscal Quarter, 1999            $38,500,000
                  3rd Fiscal Quarter, 1999            $38,500,000
                  4th Fiscal Quarter, 1999            $38,500,000
                  1st Fiscal Quarter, 2000            $39,000,000
                  2nd Fiscal Quarter, 2000            $39,000,000
                  3rd Fiscal Quarter, 2000            $39,000,000
                  4th Fiscal Quarter, 2000
                    and each Fiscal Quarter
                    thereafter                        $39,000,000"
</TABLE>

         1.6  Amendment to Subsection 7.8:  Consolidated Capital Expenditures

         Subsection 7.8 of the Credit Agreement is hereby amended (i) by
deleting the table contained therein in its entirety and substituting the
following therefor:

<TABLE>
<CAPTION>
                                                 Maximum Consolidated
                         "Period                 Capital Expenditures
                 ------------------------        --------------------
<S>              <C>                             <C>
                  Closing Date to
                   December 31, 1995              $ 2,750,000
                  Fiscal Year 1996                $ 8,350,000
                  Fiscal Year 1997                $12,100,000
                  Fiscal Year 1998                $ 9,300,000
                  Fiscal Year 1999                $ 8,300,000
                  Fiscal Year 2000
                   and each Fiscal
                   Year thereafter                $10,800,000"

</TABLE>
                                      10
<PAGE>

and (ii) by (a) deleting the reference to "and" and adding"," at the end of
clause (ii) of the last proviso contained therein, and (b) adding the following
after clause (iii) of the last proviso contained therein, but before the last
period: ", (iv) Company may incur additional Consolidated Capital Expenditures
on or before November 29, 1996 in an aggregate amount (including all fees and
expenses relating thereto and including Indebtedness assumed by Company or its
Subsidiaries in an amount equal to $7,500,000, which Indebtedness is paid in
full by Company and its Subsidiaries on the Fifth Amendment Effective Date) not
to exceed $12,500,000, consisting of the Flynn Acquisition, and (v) FN or any of
its Subsidiaries may incur additional Consolidated Capital Expenditures on or
before December 31, 1997 in an aggregate amount not to exceed $3,500,000
consisting of Flynn Purchase Option Payments."

         1.7. Amendment to Subsection 7.15: Borrower's Negative Covenants

         Amendments of Certain Documents.  Subsection 7.15B of the Credit
Agreement is hereby amended by deleting the comma appearing at the end of clause
(i) thereof and substituting therefor the phrase ", or any material terms of any
of the Iverson Acquisition Agreements, in each case as in effect on the Fourth
Amendment Effective Date, or any material terms of any of the Flynn Acquisition
Agreements, in each case as in effect on the Fifth Amendment Effective Date."

         1.8  Amendments to Section 8: Events of Default

         A.   Change in Control.  Subsection 8.12 of the Credit Agreement is
hereby amended by adding after the end of clause (vi) the following clause:

              "(vii)  the occurrence of a "Change in Ownership" or "Fundamental
         Change" or "Event of Non-Compliance" under the restated articles of
         incorporation of Holdings; or".

         B.   Failure to Consummate Acquisition or Merger.  Subsection 8.16 of
the Credit Agreement is hereby amended by inserting after the reference "reason"
appearing therein the following:

              "or the issuance of the preferred stock of Holdings on the Fifth
         Amendment Effective Date shall be unwound, reversed or otherwise
         rescinded in whole or in part for any reason".

         C.   Amendment of Certain Documents of Holdings.  Subsection 8.17 of
the Credit Agreement is hereby amended by (i) inserting after the reference
"Holdings Certificate of Designation" appearing therein the phrase "(other than
the amendment effected pursuant to the Restated Articles of Incorporation of
Holdings as in effect on the Fifth Amendment Effective Date)" and (ii) inserting
after the reference "Closing Date," appearing therein the phrase "or any of the
New Preferred Stock Purchase

                                      11
<PAGE>

Agreement or the New Warrants, in each case as in effect on the Fifth Amendment
Effective Date, in each case".

         D.   Equity Contributions.  Section 8 of the Credit Agreement is hereby
further amended by deleting subsection 8.19 in its entirety and substituting
therefor the following:

         "8.19  Equity Contributions.

                    (i) Holdings shall not have received from the New Preferred
         Stock Holders on or prior to the earlier of the Fifth Amendment
         Effective Date and November 29, 1996 an equity contribution in an
         aggregate amount equal to or greater than $20,000,000 (the "Parent
         Equity Contribution"); or (ii) Company shall not have received from
         Holdings on or prior to such earlier date an equity contribution in an
         amount equal to the Parent Equity Contribution; or (iii) Company shall
         not have used the proceeds from the Parent Equity Contribution within
         one Business Day of receipt of such proceeds (x) to prepay all
         Revolving Loans of Company and of Sun Gro on a pro rata basis (in
         accordance with the respective outstanding principal amount thereof)
         without any corresponding reduction in their respective Revolving Loan
         Commitments, and (y) to the extent the amount of such proceeds exceeds
         the aggregate outstanding principal amount of Revolving Loans, to
         prepay all Term Loans in accordance with the application order set
         forth in the first sentence of subsection 2.4B(iv)(b) in an amount
         equal to such excess (it being understood by all parties hereto that
         Company shall apply the proceeds from the Parent Equity Contribution in
         the manner set forth in this clause (iii) of this subsection 8.19
         notwithstanding anything to the contrary contained in subsection
         2.4B(iii)(c) or 2.4B(iv)(b)):"

         1.9  Substitution of Schedules

         Schedules 2.1, 4.1C, 5.5, 5.6 and 5.13.  Schedule 2.1, Schedule 4.1C,
Schedule 5.5, Schedule 5.6 and Schedule 5.13 to the Credit Agreement are hereby
amended by deleting said Schedule 2.1, Schedule 4.1C, Schedule 5.5, Schedule 5.6
and Schedule 5.13 in their entirety and substituting in place thereof a new
Schedule 2.1, Schedule 4.1C, Schedule 5.5, Schedule 5.6 and Schedule 5.13 in the
form of Annex A to this Amendment.

         1.10 Amendment of Exhibits

         Exhibits V and VIII.  The third paragraph of Exhibit V to the Credit
Agreement is hereby amended by deleting the reference to "$50,000,000" and
substituting "$60,000,000" therefor.  Exhibit VIII to the Credit Agreement is
hereby amended by

                                      12
<PAGE>

deleting Annex 1 to said Exhibit VIII in its entirety and substituting in place
thereof a new Annex 1 to Exhibit VIII in the form of Annex B to this Amendment.

         1.11 Amendment of Schedules

         Schedules 5.4 and 5.8C. The schedules to the Credit Agreement are
hereby amended to include a new Schedule 5.4 in the form of Annex A to this
Amendment. In addition, Schedule 5.8C to the Credit Agreement is hereby amended
by deleting the reference to "1. Bridge Note Agreement" of said Schedule 5.8C.
Schedule I to the Company Security Agreement is hereby amended by adding thereto
under the heading "Assigned Agreements" the following:

              "1. That certain Stock Purchase Agreement dated as of November 27,
    1996 by and among Flynn Industries, Inc., certain individual stock holders
    of Flynn Nurseries, Inc. and Hines Horticulture, Inc., as such agreement may
    be amended from time to time after the Fifth Amendment Effective Date to the
    extent permitted under subsection 7.15.

              2. That certain Escrow Agreement dated as of November 27, 1996
    among Hines Horticulture, Inc., Flynn Industries, Inc., the other
    stockholders of Flynn Nurseries, Inc. and an escrow agent, as such agreement
    may be amended from time to time after the Fifth Amendment Effective Date to
    the extent permitted under subsection 7.15 or 8.17.

              3. That certain Acquisition Agreement dated as of August 30, 1996
    by and among Ronald C. Iverson, Iverson Perennial Gardens, Inc. and Hines
    Horticulture, Inc."


         Section 2.  PRO RATA SHARES

         Upon the effectiveness of this Amendment, each existing Domestic Lender
which increases its Revolving Loan Commitment (an "Increasing Lender" and
collectively, the "Increasing Lenders"), as set forth on Schedule 2.1 to the
Credit Agreement, as amended by this Amendment, shall pay to Agent by wire
transfer of immediately available funds such amount, if any, as calculated by
Agent, as reflects such Increasing Lender's increased Pro Rata Share of the
outstanding Revolving Loans (and, if applicable, such Increasing Lender's
increased Pro Rata Share of any participations which have been funded by
Domestic Lenders with respect to outstanding Letters of Credit). Agent shall
promptly pay to each other Domestic Lender such amounts, as calculated by Agent,
as may be necessary to reflect such other Domestic Lender's then Pro Rata Share,
as set forth on Schedule 2.1 to the Credit Agreement, as amended by this
Amendment, of the outstanding Revolving Loans (and, if applicable, such other
Lender's then Pro Rata Share of any participations which have been funded by
Domestic Lenders with respect to outstanding Letters of Credit).

                                      13
<PAGE>

         Section 3.  CONSENT

         3.1  Consent to Flynn Acquisition
              ----------------------------

         A. Subject to the terms and conditions set forth herein and in reliance
on the representations and warranties of Company contained herein, Lenders
hereby consent to the Flynn Acquisition by Company for a total consideration
(including all fees and expenses relating thereto and including Indebtedness
assumed by Company or its Subsidiaries in an amount not exceeding $7,500,000,
which Indebtedness is paid in full by Company and its Subsidiaries on the Fifth
Amendment Effective Date) not exceeding $12,500,000.

         B. Subject to the terms and conditions set forth herein and in reliance
on the representations and warranties of Company contained herein, Lenders
hereby consent to the following transactions between Company and Blooming Farm,
Inc. ("BFI"): (i) Purchase and Sale Agreement, dated June 21, 1996, between
Company, as seller, and BFI, as buyer, for that certain 53-acre parcel of real
property described therein, as unamended; (ii) Warranty Deed, dated June 21,
1996, from Company to BFI, for the transfer and conveyance of such real
property, as unamended; (iii) Secured Promissory Note, dated June 21, 1996, from
BFI to Company in the amount of $151,050.00 as payment of the purchase price for
such real property, as unamended; (iv) Trust Deed, dated June 21, 1996, from BFI
to Company to secure BFI's payment of such Promissory Note, as unamended; and
(v) Agricultural Lease, dated June 21, 1996, between Company and BFI for the
lease of such real property by BFI to Company, as unamended.


         3.2  Limitation of Consent
              ---------------------

         Without limiting the generality of the provisions of subsection 10.6 of
the Credit Agreement, the consent set forth above shall be limited precisely as
written and relate solely to the Flynn Acquisition in the manner and to the
extent described above, and nothing in this Section 3 shall be deemed to:

         1.  constitute a waiver of compliance by Company with respect to any
    other term, provision or condition of the Credit Agreement or any other
    instrument or agreement referred to therein (whether in connection with the
    Flynn Acquisition or otherwise); or

         2.  prejudice any right or remedy that Agent or any Lender may now have
    (except to the extent that such right or remedy was based upon existing
    defaults that will not exist after giving effect to this Section 3) or may
    have in the future under or in connection with the Credit Agreement or any
    other instrument or agreement referred to therein.

                                      14
<PAGE>

         Except as expressly set forth herein, the terms, provisions and
conditions of the Credit Agreement and the other Loan Documents shall remain in
full force and effect and in all other respects are hereby ratified and
confirmed.

         Section 4.  CONDITIONS TO EFFECTIVENESS

         Sections 1, 2 and 3 of this Amendment shall become effective only upon
the satisfaction of all of the following conditions precedent (the date of
satisfaction of such conditions being referred to herein as the "Fifth Amendment
Effective Date"):

         A. On or before the Fifth Amendment Effective Date, Holdings and each
Borrower shall deliver to Lenders (or to Agent for Lenders with sufficient
originally executed copies, where appropriate, for each Lender and its counsel)
the following, each, unless otherwise noted, dated the Fifth Amendment Effective
Date:

              1. Certified copies of its Articles or Certificate of
    Incorporation, or a Certificate of the corporate secretary or assistant
    secretary for each of Holdings and each Borrower certifying as of the Fifth
    Amendment Effective Date that:

                   a. The Certificate or Articles of Incorporation of Holdings
         or such Borrower have not been amended, modified or otherwise changed
         since the Closing Date; and

                   b. The Bylaws of Holdings or such Borrower have not been
         amended, modified or otherwise changed since the Closing Date;

              2. Certified copies of the Certificate or Articles of
    Incorporation of FN, FRN and FRN, Inc., each dated a recent date prior to
    the Fifth Amendment Effective Date;

              3. Copies of the Bylaws of FN, FRN and FRN, Inc., each
    certificated as of the Fifth Amendment Effective Date by the applicable
    corporate secretary or an assistant secretary;

              4. A good standing certificate of Holdings, each Borrower, FN, FRN
    and FRN, Inc. from the Secretary of State of the jurisdiction of its
    incorporation and the jurisdiction in which its principal place of business
    is located, each dated a recent date prior to the Fifth Amendment Effective
    Date;

              5. Resolutions of Board of Directors of each of Holdings, each
    Borrower, FN, FRN, and FRN, Inc. approving and authorizing the execution,
    delivery, and performance of this Amendment, each of the other Loan
    Documents entered into on or about the Fifth Amendment Effective Date and
    the Flynn Acquisition Agreements and, in the case of Company and Sun Gro,
    approving and

                                      15
<PAGE>

    authorizing the execution, delivery and payment of each Allonge to Revolving
    Note, substantially in the form of Annex C to this Amendment (collectively,
    the "Allonges"), certified as of the Fifth Amendment Effective Date by the
    applicable Loan Party's corporate secretary or an assistant secretary as
    being in full force and effect without modification or amendment;

              6. Signature and incumbency certificates of officers of each of
    Holdings, each Borrower, FN, FRN and FRN, Inc. executing this Amendment,
    each of the other Loan Documents entered into on or about the Fifth
    Amendment Effective Date and the Flynn Acquisition Agreements;

              7. Copies of this Amendment executed by Holdings, each Borrower,
    FN, FRN, FRN, Inc. and each Lender, and the Allonges, each executed by
    Company and Sun Gro, drawn to the order of each Domestic Lender;

              8. Executed originals of the Domestic Subsidiary Guaranty, a
    Domestic Subsidiary Pledge Agreement, a Domestic Subsidiary Security
    Agreement and a Domestic Subsidiary Trademark Security Agreement, executed
    by each of FN, FRN and FRN, Inc. and an executed original of a Pledge
    Amendment to the Company Pledge Agreement pursuant to which Company pledges
    to Agent all of the issued and outstanding capital stock of FN and certain
    intercompany promissory notes;

              9. Evidence in form and substance satisfactory to Agent that
    Holdings, Company and Company's Subsidiaries have taken or caused to be
    taken such actions (other than the filing or recording of items described in
    clauses (ii), (iii) and (iv) below) in such a manner so that Agent has a
    valid and perfected first priority security interest as of the Fifth
    Amendment Effective Date in the entire personal and mixed property
    Collateral of FN, FRN and FRN, Inc. Such actions shall include, without
    limitation, the following:

              (i) delivery to Agent of certificates (which certificates shall be
         registered in the name of Agent or properly endorsed in blank for
         transfer or accompanied by irrevocable undated stock powers duly
         endorsed in blank, all in form and substance satisfactory to Agent)
         representing the capital stock pledged pursuant to the Domestic
         Subsidiary Pledge Agreements executed by FN and FRN or the Pledge
         Amendment to the Company Pledge Agreement and delivery to Agent of
         intercompany promissory notes executed and duly endorsed by FN, FRN,
         FRN, Inc. and Company in form and substance satisfactory to Agent and
         all other instruments (duly endorsed where appropriate) evidencing the
         Collateral pledged pursuant to such Domestic Subsidiary Pledge
         Agreements or such Pledge Amendment;

                                      16
<PAGE>

              (ii) delivery to Agent of Uniform Commercial Code financing
         statements as to the Collateral of FN, FRN or FRN, Inc. for all
         jurisdictions as may be necessary or desirable to perfect the security
         interests in such Collateral;

              (iii) delivery to Agent of the IP Collateral Documents of FN, FRN
         or FRN, Inc., together with accurate and complete schedules thereto and
         any cover sheets, if required, for filing with the United States Patent
         and Trademark Office (the "PTO");

              (iv) delivery to Agent of a deposit account notice with respect to
         each Deposit Account listed on Schedule I annexed to the Domestic
         Subsidiary Security Agreements of FN, FRN or FRN, Inc. (it being
         understood by each party hereto that Company shall deliver to Agent a
         Lock Box Agreement or a Blocked Account Agreement executed by each
         Person that is a party thereto with respect to each such Deposit
         Account within forty-five days after the Fifth Amendment Effective
         Date); and

              (v) delivery to Agent of such other documents and instruments that
         Agent reasonably deems necessary or advisable to establish, preserve
         and perfect the first priority Liens granted to Agent on behalf of
         Lenders under the Collateral Documents of FN, FRN or FRN, Inc.;

              10. A Borrowing Base Certificate substantially in the form of
    Annex B annexed hereto, prepared as of a recent date prior to the Fifth
    Amendment Effective Date;

              11. Executed copies of the Flynn Acquisition Agreements (including
    all schedules, exhibits and amendments thereto), each in form and substance
    satisfactory to Agent;

              12. Uniform Commercial Code, tax, judgment and other Lien searches
    relating to any personal or mixed property of FN, FRN and FRN, Inc. in form
    and substance satisfactory to Agent and UCC-3 termination statements,
    mortgage releases or other comparable instruments, executed by all necessary
    Persons, terminating any and all existing UCC-1 financing statements or
    mortgages relating to any personal, mixed or real property of FN, FRN or
    FRN, Inc. in favor of any third parties (other than UCC-1 financing
    statements filed pursuant to item 9 above) in form and substance
    satisfactory to Agent;

              13. Evidence in form and substance satisfactory to Agent
    (including without limitation an Officers' Certificate to the effect set
    forth in clauses (i) - (iv) below) that:

                                      17
<PAGE>

              (i)   the Flynn Acquisition Agreements shall be in full force and
         effect and shall not have been amended, supplemented, waived or
         otherwise modified without the consent of Agent;

              (ii)  all conditions to the Flynn Acquisition set forth in the
         Flynn Acquisition Agreements shall have been satisfied in all material
         respects or the fulfillment of any such conditions shall have been
         waived with the consent of Agent (which consent shall not be
         unreasonably withheld);

              (iii) the Flynn Acquisition shall have occurred in accordance
         with the Flynn Acquisition Agreements; and

              (iv)  the aggregate purchase price for the Flynn Acquisition
         (including all fees and expenses relating thereto) does not exceed the
         sum of (x) $4,500,000 in cash ($500,000 of which shall be in an escrow
         account in accordance with the Flynn Acquisition Agreements) plus (y)
         the assumption of Indebtedness not exceeding $7,500,000, all of which
         Indebtedness is paid in full on the Fifth Amendment Effective Date plus
         (z) the payment of fees and expenses not exceeding $250,000 (other than
         fees payable to Agent or Lenders);

              14.  (i) Pro forma balance sheet of Company and its Subsidiaries
    as of October 8, 1996 after giving effect to the Flynn Acquisition and the
    financings contemplated thereby, (ii) projected financial statements
    (including balance sheets and statements of operations, stockholders' equity
    and cash flows) of Company and its Subsidiaries for the five-year period
    after consummation of the Flynn Acquisition, and (iii) financial statements
    of FN and FRN attached to the Flynn Stock Purchase Agreement as Schedules
    3.8 and 3.9 thereto, all of the foregoing in form and substance satisfactory
    to Agent and Lenders;

              15.  Any and all environmental reports relating to any facilities
    of FN, FRN or FRN, Inc. received by Company from  FII, FN, FRN or FRN, Inc.
    or obtained by Company or any of its Subsidiaries from any independent
    consultants;

              16.  Evidence in form and substance satisfactory to Agent that
    Holdings has received from New Preferred Stock Holders an equity
    contribution in an aggregate amount equal to or greater than $20,000,000 in
    cash and that Company has received from Holdings an equity contribution
    equal to such amount in cash, and an Officers' Certificate of Holdings and
    Company in form and substance satisfactory to Agent to such effect;

              17.  Evidence in form and substance satisfactory to Agent
    (including an Officers' Certificate of Holdings and Borrowers to such
    effect) that:

                                      18
<PAGE>

              (i) FRNO and Company have entered into the Flynn Oregon Agreements
         and that all of the equipment and inventory of FRNO have been
         transferred to FRN;

              (ii) all of the "C" stock investments and "C" stock loans made in
         or to FN by Farm Credit Systems of California have been repaid in full
         or redeemed in full, as applicable, prior to the consummation of the
         Flynn Acquisition and all Liens relating thereto have been released;

              (iii) all of the Indebtedness outstanding under the Credit
         Agreement dated as of October 20, 1995 among FN, FRN, FII and Farm
         Credit Services, as amended (the "Existing Flynn Credit Agreement"),
         shall have been repaid in full, that the Existing Flynn Credit
         Agreement and all related documents have been terminated and that all
         Liens relating thereto have been released;

              (iv) all intercompany Indebtedness owing by FN, FRN or FRN, Inc.
         to FII have been paid in full or cancelled prior to the Flynn
         Acquisition;

              (v) after giving effect to the Flynn Acquisition, none of FN, FRN
         or FRN, Inc. will have any outstanding Indebtedness or Contingent
         Obligations (other than under the Loan Documents) except (a) the
         Indebtedness under the Existing Flynn Credit Agreement (as herein
         defined), all of which shall have been repaid on the Fifth Amendment
         Effective Date and (b) capital lease obligations described in Schedule
         5.5 annexed to the Credit Agreement; and

              (vi) all of the Von Kempf shares shall have been cancelled;

              18.  A copy of each of the leases to which FN, FRN or FRN, Inc. is
    a party (as a lessee or as a lessor), each of which (including any purchase
    option provisions contained therein) shall be in form and substance
    satisfactory to Agent;

              19.  Unless waived by Agent, (i) a Non-Disturbance Agreement (as
    defined in the Flynn Stock Purchase Agreement) from each lender encumbering
    any Real Property Asset of FN, FRN or FRN, Inc., (ii) a Real Property Lease
    Consent (as defined in the Flynn Stock Purchase Agreement) from each lessor
    of any such Real Property Asset, and (iii) an Estoppel Letter (as defined in
    the Flynn Stock Purchase Agreement) from each landlord, lessor, sublessor or
    licensor of any such Real Property Asset, in each case (for clauses (i),
    (ii) and (iii)) in form and substance satisfactory to Agent, in each case
    other than Non-Disturbance Agreements, Real Property Lease Consents and
    Estoppel Letters relating to two Master Lease Agreements dated June 30, 1997
    with William Tomlinson and certain related parties;

                                       19
<PAGE>

              20.  Evidence in form and substance satisfactory to Agent
    (including an Officers' Certificate of Holdings and Borrowers) that (i) on
    the Fifth Amendment Effective Date, the aggregate amount of outstanding
    Indebtedness under the Existing Flynn Credit Agreement does not exceed
    $7,500,000, and (ii) Company and its Subsidiaries have repaid in full all
    amounts outstanding under the Existing Flynn Credit Agreement and have
    terminated any commitments to lend or make other extensions of credit
    thereunder. Company and its Subsidiaries shall have delivered to Agent all
    termination statements, terminations of lockbox agreements, blocked account
    agreements and collateral account agreements, assignment documents,
    satisfactions, reconveyances, releases and similar documents as to any
    financing statements, mortgages, deeds of trust, assignments and other
    agreements or instruments creating or perfecting liens or security interests
    which shall release all liens securing any and all indebtedness under the
    Existing Flynn Credit Agreement; and

              21.  An Officers' Certificate of Holdings and each Borrower, in
    form and substance satisfactory to Agent, to the effect that the
    representations and warranties in Section 5 of the Credit Agreement are
    true, correct and complete in all material respects on and as of the Fifth
    Amendment Effective Date (both before and after giving effect to the Flynn
    Acquisition and this Amendment) to the same extent as though made on and as
    of that date (or, to the extent such representations and warranties
    specifically relate to an earlier date, that such representations and
    warranties were true, correct and complete in all material respects on and
    as of such earlier date) and that Holdings or such Borrower shall have
    performed in all material respects all agreements and satisfied all
    conditions which this Amendment and the Credit Agreement as amended by this
    Amendment provide shall be performed or satisfied by it on or before the
    Fifth Amendment Effective Date except as otherwise disclosed to and agreed
    to in writing by Agent.

              22.  A fully executed and notarized modification, in form and
    substance satisfactory to Agent, to each of the Initial Mortgages, each of
    the Additional Mortgages that have been executed by any of the Borrowers or
    their Subsidiaries on or before the date hereof, and the Pledge and
    Collateral Consent Assignment dated as of October 2, 1995, executed by Hines
    Horticulture, Inc., in favor of Agent (collectively, the "Mortgage
    Modifications").

              23.  CLTA Endorsements 110.5 (or the applicable state equivalent)
    to each of the Initial Mortgage Policies and Additional Mortgage Policies
    (collectively, the "Title Endorsements"), assuring Agent that the applicable
    Initial Mortgages and Additional Mortgages remain valid and enforceable
    first priority mortgage liens on the respective Initial Mortgaged Properties
    and respective Additional Properties, free and clear of all defects and
    encumbrances except Permitted Encumbrances, which Title Endorsements shall
    be in form and substance reasonably satisfactory to Agent; provided,
    however, that this condition

                                      20
<PAGE>

    may also be satisfied by the issuance of new lender's title policies, in
    form and substance reasonably satisfactory to Agent, and which new lender's
    title policies shall generally be in the form of the Initial Mortgage
    Policies and Additional Mortgage Policies (including, without limitation,
    all title endorsements thereto) dated as of the date of recordation of the
    applicable Mortgage Modification and assuring Agent that the applicable
    Initial Mortgages and Additional Mortgages, as modified by the applicable
    Mortgage Modifications, are valid and enforceable first priority mortgage
    liens on the respective Initial Mortgaged Properties and respective
    Additional Properties, free and clear of all defects and encumbrances except
    Permitted Encumbrances.  In addition, the Initial Mortgage Policies and
    Additional Mortgage Policies shall be modified and/or endorsed to provide
    for any other matters that Agent may reasonably request, including, without
    limitation, to provide for affirmative insurance and such reinsurance as
    Agent may reasonably request, all of the foregoing in form and substance
    reasonably satisfactory to Agent.

              24.  (i) A copy of each document described in Subsection 3.1B,
    (ii) a Pledge and Collateral Assignment Agreement executed by company, as
    pledgor, and BFI, as landlord, in favor of Agent, to be recorded in the real
    estate records of Washington County, Oregon, (iii) a UCC-1 Financing
    Statement, executed by Company, as debtor, and Agent, as secured party, to
    be filed with the Oregon Secretary of State, and (iv) a copy of any title
    insurance policies issued in connection with any of the foregoing.

         B.  On or before the Fifth Amendment Effective Date, Lenders and their
respective counsel shall have received (i) originally executed copies of one or
more favorable written opinions of Kirkland & Ellis, Schreck, Jones, Bernhard,
Woloson & Godfrey, Rutan & Tucker, and Carlsmith, Ball, Wichman, Case & Ichiki,
in each case counsel to Loan Parties, in form and substance reasonably
satisfactory to Agent and its counsel, dated as of the Fifth Amendment Effective
Date, substantially in the form set forth in Annex D, Annex E, Annex F, and
Annex G hereto, respectively, and as to such other matters as Agent acting on
behalf of Lenders may reasonably request, (ii) originally executed copies of a
written opinion of Canadian counsel to Loan Parties in form and substance
reasonably satisfactory to Agent and its  counsel, and (iii) copies of written
opinions of (x) Schreck, Jones, Bernhard, Woloson & Godfrey to New Preferred
Stock Holders, and (y) Heller, Ehrman, White & McAuliffe, and Woodburn & Wedge,
in each case to Loan Parties, together with reliance letters relating thereto in
form and substance satisfactory to Agent.

         C.  Agent and each Lender shall have received the fees payable by
Company on the Fifth Amendment Effective Date in such amounts as have been
separately agreed upon.

         D.  On or before the Fifth Amendment Effective Date, all corporate and
other proceedings taken or to be taken in connection with this Amendment and all

                                      21
<PAGE>

documents incidental thereto not previously found acceptable by Agent, acting on
behalf of Lenders, and its counsel shall be satisfactory in form and substance
to Agent and such counsel, and Agent and such counsel shall have received all
such counterpart originals or certified copies of such documents as Agent may
reasonably request.

         Section 5.  COMPANY'S REPRESENTATIONS AND WARRANTIES

         In order to induce Lenders to enter into this Amendment and to amend
the Credit Agreement in the manner provided herein, each Borrower represents and
warrants to each Lender that the following statements are true, correct and
complete:

         A.  Corporate Power and Authority.  Each Loan Party hereto has all
requisite corporate power and authority to enter into this Amendment, each of
the other Loan Documents entered into as of the date hereof, and each of the
Flynn Acquisition Agreements, and to carry out the transactions contemplated by,
and perform its obligations under, the Credit Agreement as amended by this
Amendment (the "Amended Agreement"), such other Loan Documents, and each of the
Flynn Acquisition Agreements, and Company and Sun Gro have all requisite
corporate power and authority to issue the Allonges.

         B.  Authorization of Agreements.  The execution and delivery of this
Amendment, each of the other Loan Documents entered into as of the date hereof,
the Allonges, and each of the Flynn Acquisition Agreement, the performance of
the Amended Agreement, such other Loan Documents, and each of the Flynn
Acquisition Agreement, and the payment of the Notes as amended by the Allonges
(the "Amended Notes") have been duly authorized by all necessary corporate
action on the part of each Loan Party thereto.

         C.  No Conflict.  The execution and delivery by each Loan Party hereto
of this Amendment, each of the other Loan Documents entered into as of the date
hereof, and each of the Flynn Acquisition Agreements, the execution and delivery
by Company and Sun Gro of the Allonges, the performance by each Loan Party
hereto of the Amended Agreement and such other Loan Documents and each of the
Flynn Acquisition Agreements, and the payment of the Amended Notes by Company
and Sun Gro do not and will not (i) violate any provision of any law or any
governmental rule or regulation applicable to Holdings or any of its
Subsidiaries (including without limitation FN and its Subsidiaries), the
Certificate or Articles of Incorporation or Bylaws of Holdings or any of its
Subsidiaries or any order, judgment or decree of any court or other agency of
government binding on Holdings or any of its Subsidiaries, (ii) conflict with,
result in a breach of or constitute (with due notice or lapse of time or both) a
default under any Contractual Obligation of Holdings or any of its Subsidiaries,
(iii) result in or require the creation or imposition of any Lien upon any of
the properties or assets of Holdings or any of its Subsidiaries (other than any
Liens created under any of the Loan Documents in favor of Agent on behalf of
Lenders), or (iv) require any approval of stockholders or any approval or
consent of any Person under any Contractual Obligation

                                      22
<PAGE>


of Holdings or any of its Subsidiaries, except for such approvals or consents
which have been obtained on or before the Fifth Amendment Effective Date and
disclosed in writing to Lenders.

         D.   Governmental Consents.  The execution and delivery by the Loan
Parties hereto of this Amendment, each of the other Loan Documents entered into
as of the date hereof and each of the Flynn Acquisition Agreements, the
execution and delivery by Company and Sun Gro of the Allonges, the performance
by the Loan Parties party hereto of the Amended Agreement and such other Loan
Documents and the Flynn Acquisition Agreements and the payment of the Amended
Notes by Company and Sun Gro do not and will not require any registration with,
consent or approval of, or notice to, or other action to, with or by, any
federal, state or other governmental authority or regulatory body, except for
(i) filings required by federal or state securities laws, (ii) such other
registrations, consents, approvals, notices or other actions which have been
made, obtained, given or taken on or before the Fifth Amendment Effective Date
and (iii) filings and recordings which are required to be made to perfect
security interests in the Collateral.

         E.   Binding Obligation.  This Amendment and each of the other Loan
Documents entered into as of the date hereof and the Amended Agreement have been
duly executed and delivered by each Loan Party hereto, the Allonges have been
duly executed and delivered by Company and Sun Gro, and each of this Amendment
and such other Loan Documents, the Amended Agreement and the Amended Notes are
the legally valid and binding obligations of each Loan Party thereto,
enforceable against such Loan Party in accordance with their respective terms,
except as may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors' rights generally or by
equitable principles relating to enforceability.  The subordination provisions
of each of the Takeout Securities are enforceable against the holders thereof in
accordance with their terms and the Loans, Letters of Credit and all other
monetary Obligations under the Credit Agreement (after giving effect to the
increase in the Revolving Loan Commitments contemplated by this Amendment) are
within the definitions of "Bank Indebtedness," "Senior Indebtedness" and
"Designated Senior Indebtedness" included in such provisions.

         F.   Issuance of Preferred Stock.  All shares of preferred stock of
Holdings issued pursuant to the New Preferred Stock Purchase Agreement have been
duly and validly issued, fully paid and nonassessable.  No stockholder of
Holdings has or will have any preemptive rights to subscribe for any additional
preferred stock of Holdings.  Any issuance of any preferred stock of Holdings,
upon such issuance and sale, will either (a) have been registered and qualified
under applicable federal and state securities laws or (b) is exempt therefrom.

         G.   Subsidiaries of FN.  FN has no Subsidiaries other than FRN and
FRN, Inc.

                                      23
<PAGE>


         H.   Patents of FN, FRN and FRN, Inc.  FN, FRN and FRN, Inc. have no
right, title or interest in any patents or patent applications under any law.

         I.   Incorporation of Representations and Warranties From Credit
Agreement.  The representations and warranties contained in Section 5 of the
Credit Agreement and contained in the other Loan Documents are and will be true,
correct and complete in all material respects on and as of the Fifth Amendment
Effective Date (both before and after giving effect to the Flynn Acquisition and
this Amendment) to the same extent as though made on and as of that date, except
to the extent such representations and warranties specifically relate to an
earlier date, in which case they were true, correct and complete in all material
respects on and as of such earlier date.

         J.   Absence of Default.  No event has occurred and is continuing or
will result from the consummation of the transactions contemplated by this
Amendment that would constitute an Event of Default or a Potential Event of
Default.

         K.   Receivables Facility.  The Receivables Sale and Contribution
Agreement dated May 31, 1996 by and between FRN and FRN, Inc. (the "Receivables
Agreement") and all related agreements have been terminated and FRN has not
sold, transferred, contributed or conveyed whether outright or by way of
security at any time any accounts, accounts receivable, documents, chattel
paper, and general intangible, or any other property to FRN, Inc., and no
obligations are outstanding to Capital USA Funding, L.P., Commerzbank
Aktiengesellschaft, New York Branch, Boatmen's Trust Company of Arkansas or any
other financial institution under the receivables facility relating to the
Receivables Agreement.


         Section 6.  ACKNOWLEDGEMENT AND CONSENT

         Company is a party to the Company Guaranty, the Company Security
Agreement, the Company Pledge Agreement, the Company Trademark Security
Agreement, the Company Patent Security Agreement and the Collateral Account
Agreement pursuant to which Company has (i) guarantied the Obligations and (ii)
created liens in favor of Agent on certain Collateral to secure the Obligations
and to secure its obligations under the Company Guaranty.  Sun Gro is a party to
the Domestic Subsidiary Guaranty, a Domestic Subsidiary Security Agreement, the
Domestic Subsidiary Pledge Agreement, a Domestic Subsidiary Trademark Security
Agreement, and a Domestic Subsidiary Patent Security Agreement pursuant to which
Sun Gro has (i) guarantied the Obligations and (ii) created liens in favor of
Agent on certain Collateral to secure the Obligations and to secure the
obligations of Sun Gro under the Domestic Subsidiary Guaranty.  Sun Gro Canada
is a party to the Canadian Subsidiary Security Agreement and the Canadian
Subsidiary Pledge Agreement pursuant to which Company has created liens in favor
of Agent on certain Collateral to secure the Obligations.  Holdings is a party
to the Holdings Guaranty and the Holdings Pledge Agreement pursuant to which
Holdings has (i) guarantied the Obligations and (ii) pledged certain

                                      24
<PAGE>


Collateral to Agent to secure the obligations of Holdings under the Holdings
Guaranty.  Each of FN, FRN and FRN, Inc. has become a party to the Domestic
Subsidiary Guaranty, a Domestic Subsidiary Security Agreement, a Domestic
Subsidiary Pledge Agreement, a Domestic Subsidiary Trademark Security Agreement,
and a Domestic Subsidiary Patent Security Agreement pursuant to which such Loan
Party has (i) guarantied the Obligations and (ii) created liens in favor of
Agent on certain Collateral to secure the obligations of such Loan Party under
the Domestic Subsidiary Guaranty.  Company, Sun Gro, Sun Gro Canada, Holdings,
FN, FRN, and FRN, Inc. are collectively referred to herein as the "Credit
Support Parties", and the Guaranties and Collateral Documents referred to above
are collectively referred to herein as the "Credit Support Documents".

         Each Credit Support Party hereby acknowledges that it has reviewed the
terms and provisions of the Credit Agreement and this Amendment and consents to
the amendment of the Credit Agreement effected pursuant to this Amendment.  Each
Credit Support Party hereby confirms that each Credit Support Document to which
it is a party or otherwise bound and all Collateral encumbered thereby will
continue to guaranty or secure, as the case may be, to the fullest extent
possible the payment and performance of all "Obligations," "Guarantied
Obligations" and "Secured Obligations," as the case may be (in each case as such
terms are defined in the applicable Credit Support Document), including without
limitation the payment and performance of all such "Obligations," "Guarantied
Obligations" or "Secured Obligations," as the case may be, in respect of the
Obligations of Borrowers now or hereafter existing under or in respect of the
Amended Agreement and the Notes defined therein.

         Each Credit Support Party acknowledges and agrees that any of the
Credit Support Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment.  Each Credit Support Party
represents and warrants that all representations and warranties contained in the
Amended Agreement and the Credit Support Documents to which it is a party or
otherwise bound are true, correct and complete in all material respects on and
as of the Fifth Amendment Effective Date to the same extent as though made on
and as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true, correct
and complete in all material respects on and as of such earlier date.

         Each Credit Support Party (other than Borrowers) acknowledges and
agrees that (i) notwithstanding the conditions to effectiveness set forth in
this Amendment, such Credit Support Party is not required by the terms of the
Credit Agreement or any other Loan Document to consent to the amendments to the
Credit Agreement effected pursuant to this Amendment and (ii) nothing in the
Credit Agreement, this Amendment or any other Loan Document shall be deemed to
require the consent of such Credit Support Party to any future amendments to the
Credit Agreement.

                                      25
<PAGE>


         Section 7.  MISCELLANEOUS

         A.   Reference to and Effect on the Credit Agreement and the Other Loan
Documents.

         (i)    On and after the Fifth Amendment Effective Date, each reference
    in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein"
    or words of like import referring to the Credit Agreement, and each
    reference in the other Loan Documents to the "Credit Agreement",
    "thereunder", "thereof" or words of like import referring to the Credit
    Agreement shall mean and be a reference to the Amended Agreement.

         (ii)   Except as specifically amended by this Amendment, the Credit
    Agreement and the other Loan Documents shall remain in full force and effect
    and are hereby ratified and confirmed.

         (iii)  The execution, delivery and performance of this Amendment shall
    not, except as expressly provided herein, constitute a waiver of any
    provision of, or operate as a waiver of any right, power or remedy of Agent
    or any Lender under, the Credit Agreement or any of the other Loan
    Documents.

         B.   Fees and Expenses.  Company acknowledges that all costs, fees and
expenses as described in subsection 10.2 of the Credit Agreement incurred by
Agent and its counsel with respect to this Amendment and the documents and
transactions contemplated hereby shall be for the account of Company.

         C.   Headings.  Section and subsection headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose or be given any substantive effect.

         D.   Applicable Law.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.

         E.   Counterparts; Effectiveness.  This Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document.  This Amendment (other than the
provisions of Sections 1, 2 and 3 hereof, the

                                      26
<PAGE>


effectiveness of which is governed by Section 4 hereof) shall become effective
upon the execution of a counterpart hereof by each Lender and each of the other
parties hereto and receipt by Company and Agent of written or telephonic
notification of such execution and authorization of delivery thereof.



                 [Remainder of page intentionally left blank]

                                      27
<PAGE>


         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.


                               BORROWERS:

                               HINES HORTICULTURE, INC.
                               (formerly known as Hines Nurseries Inc.)


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-1
<PAGE>


                               SUN GRO HORTICULTURE INC.


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-2
<PAGE>


                               SUN GRO HORTICULTURE CANADA LTD.


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-3
<PAGE>


                               HINES HOLDINGS, INC.,
                               (formerly known as Hines Horticulture Inc.) (for
                               purposes of Section 6 only) as a Credit Support
                               Party


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-4
<PAGE>


                               FLYNN NURSERIES, INC.
                               (for purposes of Section 6 only) as a Credit
                               Support Party


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-5
<PAGE>


                               FLYNN RAINBOW NURSERIES, INC.
                               (for purposes of Section 6 only) as a Credit
                               Support Party


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-6
<PAGE>


                               FRN, INC.
                               (for purposes of Section 6 only) as a Credit
                               Support Party


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-7
<PAGE>


                               LENDERS:

                               BT COMMERCIAL CORPORATION,
                               as a Domestic Lender and as Agent


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-8
<PAGE>


                               BT BANK OF CANADA,
                               as a Canadian Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                      S-9
<PAGE>


                               BANKERS TRUST COMPANY,
                               as an Issuing Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-10
<PAGE>


                               HARRIS TRUST AND SAVINGS BANK,
                               as a Domestic Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-11
<PAGE>


                               FLEET BANK OF MASSACHUSETTS, N.A.,
                               as a Domestic Lender and Canadian Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-12
<PAGE>


                               LASALLE NATIONAL BANK,
                               as a Domestic Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-13
<PAGE>


                               NATIONSBANK OF TEXAS, N.A.,
                               as a Domestic Lender and Canadian Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-14
<PAGE>


                               UNION BANK OF CALIFORNIA, N.A.,
                               as a Domestic Lender and Canadian Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-15
<PAGE>


                               WELLS FARGO BANK, N.A.,
                               as a Domestic Lender and Canadian Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-16
<PAGE>


                               BANK OF MONTREAL,
                               as a Canadian Lender


                               By:
                                   -------------------------------
                               Title:
                                      ----------------------------

                                     S-17
<PAGE>

                                        TREASURE VALLEY LAND COMPANY, L.C.

                                        By: Jeff Hollingworth, its sole Manager



                                        By:
                                           -------------------------------------

                                        Title:
                                               ---------------------------------

                                        Address:  1550 S. Redwood Road
                                                  Salt Lake City, UT 84104
                                                  Attention: Michael Frei

                                      S-2